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727000.0
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2010-09-03 00:00:00 UTC
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Hewlett-Packard Wins Bidding War for 3Par over Dell (HPQ, DELL)
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DELL
|
https://www.nasdaq.com/articles/hewlett-packard-wins-bidding-war-3par-over-dell-hpq-dell-2010-09-03
|
nan
|
nan
|
PC and printer maker Hewlett-Packard Company ( HPQ ) on Thursday won the bidding war for storage specialist 3Par ( PAR ) over rival Dell Inc. ( DELL ), as Dell decided to pull out of the competition.
HP's winning bid for 3Par amounted to $33 per share, which represents a massive 366% premium over 3Par's Aug. 13 closing price - the day before takeover rumors began.
Dell was willing to go as high as $32 per share for 3Par, which provides utility storage systems for medium-sized businesses. On Aug. 16, Dell began the bidding for 3Par with an $18 per-share offer. HP quickly followed with a higher bid , forcing Dell to up its offering price.
HP senior VP of corporate strategy said that "We took a measured approach throughout the process and have decided to end these discussions. We believe our strategy of creating open, affordable and capable solutions resonates well with customers and will enable us to continue to outgrow the industry." HP noted it expects the deal to close by the end of the fourth quarter.
Hewlett-Packard shares rose 32 cents, or +0.8%, in premarket trading Friday.
The Bottom Line
We had removed shares of HPQ from our recommended list back on Oct.1, 2009, when the stock was trading at $47.21. The company has a .81% dividend yield, based on last night's closing stock price of $39.68. The stock has technical support in the $35 price area. If the shares can firm up, we see overhead resistance around the $44-$46 price levels. We would remain on the sidelines for now.
Hewlett-Packard Company ( HPQ ) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.3 out of 5 stars.
Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Created by Dividend.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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PC and printer maker Hewlett-Packard Company ( HPQ ) on Thursday won the bidding war for storage specialist 3Par ( PAR ) over rival Dell Inc. ( DELL ), as Dell decided to pull out of the competition. Dell was willing to go as high as $32 per share for 3Par, which provides utility storage systems for medium-sized businesses. On Aug. 16, Dell began the bidding for 3Par with an $18 per-share offer.
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PC and printer maker Hewlett-Packard Company ( HPQ ) on Thursday won the bidding war for storage specialist 3Par ( PAR ) over rival Dell Inc. ( DELL ), as Dell decided to pull out of the competition. Dell was willing to go as high as $32 per share for 3Par, which provides utility storage systems for medium-sized businesses. On Aug. 16, Dell began the bidding for 3Par with an $18 per-share offer.
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PC and printer maker Hewlett-Packard Company ( HPQ ) on Thursday won the bidding war for storage specialist 3Par ( PAR ) over rival Dell Inc. ( DELL ), as Dell decided to pull out of the competition. HP quickly followed with a higher bid , forcing Dell to up its offering price. Dell was willing to go as high as $32 per share for 3Par, which provides utility storage systems for medium-sized businesses.
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PC and printer maker Hewlett-Packard Company ( HPQ ) on Thursday won the bidding war for storage specialist 3Par ( PAR ) over rival Dell Inc. ( DELL ), as Dell decided to pull out of the competition. Dell was willing to go as high as $32 per share for 3Par, which provides utility storage systems for medium-sized businesses. On Aug. 16, Dell began the bidding for 3Par with an $18 per-share offer.
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eec371f7-e9b3-4e37-ae54-e1fc3c81e7ec
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727001.0
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2010-09-02 00:00:00 UTC
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HP Emerges as Victor over Dell in Battle for 3Par
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DELL
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https://www.nasdaq.com/articles/hp-emerges-victor-over-dell-battle-3par-2010-09-02
|
nan
|
nan
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Until this morning, Dell ( DELL ) and Hewlett-Packard ( HPQ ) were mired in a bidding war over 3Par ( PAR ), a leading provider of utility storage solutions for enterprises. HP won that war today, paying $2.4 billion in cash to acquire 3Par.
Below we highlight the significance of 3Par and explain how it might impact HP's storage business in the future.
Utility storage primer
Utility storage is a category of data storage systems designed for utility computing, a form of information technology in which storage and computation are delivered as a metered service, rather like a power utility. 3Par's unique storage technology powers so-called virtual data centers for mid-sized to large enterprises, including financial service firms, government entities, hosted computing providers, and consumer-oriented Internet companies.
3Par's value proposition is based on the premise that unused storage is wasteful. Conventional data centers typically use just 10% to 25% of allocated disk space. By contrast, 3Par's technology allocates disk space only when applications need storage capacity, reducing the total cost of storage by up to 50% according to the company.
As more enterprises shut down their in-house data centers and turn to on-demand storage and computing services delivered via the Internet, their storage needs become more variable and less predictable. This makes 3Par a great fit for the cloud computing era, which helps explain why HP and Dell are competing so fiercely to acquire the company's proprietary technology.
Why were Dell & HP chasing 3Par?
In revenue terms, Dell currently holds about 13% of the total disk storage systems market. HP's share is 18%. In recent years, both companies have increased their storage market share via acquisitions. But they still trail industry leaders EMC ( EMC ) and NetApp ( NTAP ) in the fast-growing market for so-called open networked disk storage, a technology that links data storage devices over the Internet.
Corporate data storage requirements have doubled every 18 months in recent years, and we expect this trend to continue going forward. We expect the open networked disk storage market to grow at an even faster pace.
3Par's revenues have grown at an annualized rate of 67% over the past five years, reaching $185 million in 2009. Our conservative initial estimate is that the acquisition could boost HP's storage revenues by $400 million in 2011, rising to $2 billion by the end of the Trefis forecast period.
You can drag the trend-line in the chart below to create your own storage revenue forecast for HP.
Is 3Par worth $2.4 billion?
Dell opened the bidding for 3Par on August 16, offering $18 per share. By Wednesday, September 1, HP was offering $30 a share to acquire 3Par, or $2 billion. Dell had until midnight Wednesday to match this bid, but the deadline passed with no word from Dell.
On Thursday morning, September 2, HP raised its bid to $33 a share, valuing 3Par at about $2.4 billion. In a press release , 3Par announced that it considered this offer "superior" to Dell's latest bid of $32 a share and that it intended to dissolve the original merger agreement with Dell.
$2.4 billion is a lot of money to pay for a company that posted $185 million in revenues last year. However, we think the valuation may be justified. Here's why:
By acquiring 3Par, HP will be able to sell packaged products based around the company's storage solution. This will boost revenues of other divisions, like services and software. We did not factor this multiplier effect into our analysis above, which is why our revenue estimate might be conservative.
3Par's technology is unique meaning that Dell will need to duplicate the technology from scratch if it wishes to compete with HP based on such technology. Dell will incur heavy R&D costs to develop such technology and may potentially lose share in the emerging utility storage market if it is unable to compete with HP.
We have not yet updated our$54 Trefis price estimate for Hewlett-Packard to incorporate 3Par, but will be doing so soon.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This makes 3Par a great fit for the cloud computing era, which helps explain why HP and Dell are competing so fiercely to acquire the company's proprietary technology. Dell will incur heavy R&D costs to develop such technology and may potentially lose share in the emerging utility storage market if it is unable to compete with HP. Until this morning, Dell ( DELL ) and Hewlett-Packard ( HPQ ) were mired in a bidding war over 3Par ( PAR ), a leading provider of utility storage solutions for enterprises.
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Until this morning, Dell ( DELL ) and Hewlett-Packard ( HPQ ) were mired in a bidding war over 3Par ( PAR ), a leading provider of utility storage solutions for enterprises. This makes 3Par a great fit for the cloud computing era, which helps explain why HP and Dell are competing so fiercely to acquire the company's proprietary technology. Why were Dell & HP chasing 3Par?
|
Dell will incur heavy R&D costs to develop such technology and may potentially lose share in the emerging utility storage market if it is unable to compete with HP. Until this morning, Dell ( DELL ) and Hewlett-Packard ( HPQ ) were mired in a bidding war over 3Par ( PAR ), a leading provider of utility storage solutions for enterprises. This makes 3Par a great fit for the cloud computing era, which helps explain why HP and Dell are competing so fiercely to acquire the company's proprietary technology.
|
Until this morning, Dell ( DELL ) and Hewlett-Packard ( HPQ ) were mired in a bidding war over 3Par ( PAR ), a leading provider of utility storage solutions for enterprises. This makes 3Par a great fit for the cloud computing era, which helps explain why HP and Dell are competing so fiercely to acquire the company's proprietary technology. Why were Dell & HP chasing 3Par?
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c0c93733-e8a9-4a15-85ea-e86b1559c831
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727002.0
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2010-09-02 00:00:00 UTC
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H-P looks poised to win 3Par
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DELL
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https://www.nasdaq.com/articles/h-p-looks-poised-win-3par-2010-09-02
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nan
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nan
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Hewlett-Packard ( HPQ ) and Dell ( DELL ) have been locked in a battle for storage-software company 3Par ( PAR ) for the last three weeks, but it looks as though the latter is conceding to the former.
H-P bid $33 for each share of 3Par Thursday, and Dell indicated that it wouldn't make a higher offer. The move all but gives H-P the win - a surprising twist in what has become one of the most closely watched takeover fights in recent memory.
Dell was the first to make a bid for 3Par, which produces software that helps companies manage their data more effectively. Its initial bid was for $1.15 billion; H-P quickly countered with a higher offer. The two tech giants volleyed ever-higher offers back and forth, but H-P's $33-a-share bid - which values 3Par at $2.4 billion - appears to have put an end to the game.
Why did the battle reach such a fever pitch? 3Par is the last independent storage-software company - and it would be a valuable part of either Dell or H-P's portfolio. Also contributing to the frenzy was the wider merger and acquisition market: Last month saw $286 billion in M&A deals, the most since July 2008.
It was the busiest August for M&A on record.
By Benjamin Foster
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell was the first to make a bid for 3Par, which produces software that helps companies manage their data more effectively. Hewlett-Packard ( HPQ ) and Dell ( DELL ) have been locked in a battle for storage-software company 3Par ( PAR ) for the last three weeks, but it looks as though the latter is conceding to the former. H-P bid $33 for each share of 3Par Thursday, and Dell indicated that it wouldn't make a higher offer.
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Hewlett-Packard ( HPQ ) and Dell ( DELL ) have been locked in a battle for storage-software company 3Par ( PAR ) for the last three weeks, but it looks as though the latter is conceding to the former. H-P bid $33 for each share of 3Par Thursday, and Dell indicated that it wouldn't make a higher offer. Dell was the first to make a bid for 3Par, which produces software that helps companies manage their data more effectively.
|
Hewlett-Packard ( HPQ ) and Dell ( DELL ) have been locked in a battle for storage-software company 3Par ( PAR ) for the last three weeks, but it looks as though the latter is conceding to the former. H-P bid $33 for each share of 3Par Thursday, and Dell indicated that it wouldn't make a higher offer. Dell was the first to make a bid for 3Par, which produces software that helps companies manage their data more effectively.
|
Hewlett-Packard ( HPQ ) and Dell ( DELL ) have been locked in a battle for storage-software company 3Par ( PAR ) for the last three weeks, but it looks as though the latter is conceding to the former. H-P bid $33 for each share of 3Par Thursday, and Dell indicated that it wouldn't make a higher offer. Dell was the first to make a bid for 3Par, which produces software that helps companies manage their data more effectively.
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b2596730-ed60-4b8c-9ff3-275cdd3fd379
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727003.0
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2010-09-01 00:00:00 UTC
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Short This Tech Blue Chip
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DELL
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https://www.nasdaq.com/articles/short-tech-blue-chip-2010-09-01
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nan
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nan
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40.
In February 2009, the stock hit a bear market low under $8, and then rallied to $17 in September 2009. And following a pullback early this year, it rallied and again topped at $17.
This double-top led to a serious decline marked by a death cross in late June and a failure to rally above its 50-day moving average in August. Dell is in a bear market with little support in sight.
Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72. The trading target is $8.50 to $9.
Check with their broker for margin requirements and the ability to borrow stock for a short sale. Selling naked shorts is a violation of current SEC rules.
Selling short is also considered a speculative trade and not suitable for all investors. Short sellers are advised to always enter stop-loss orders in order to avoid unlimited losses.
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
The 10-to-1 Options Trading Secret- John Lansing reveals how to break down scientific chart analysis into easy-to-make trades that will have you trading, and profiting, with confidence in no time. Learn how to leverage your profits 10 times larger with a tiny investment. Download his FREE trading guide here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. This double-top led to a serious decline marked by a death cross in late June and a failure to rally above its 50-day moving average in August.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72.
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bc590405-7d42-4b56-bde7-7cb2ebf5ad8c
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727004.0
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2010-08-31 00:00:00 UTC
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11 Tech Blue Chips That Are Short Circuiting
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DELL
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https://www.nasdaq.com/articles/11-tech-blue-chips-are-short-circuiting-2010-08-31
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nan
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nan
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With the merger war between Dell (NASDAQ: DELL ) and Hewlett Packard (NYSE: HPQ ) over 3Par (NYSE: PAR ) raging on, tech stocks have really been in focus lately. A spate of merger and acquisition action has prompted a renewed focus on information technology companies, particularly cloud computing stocks.
However, don't be fooled into thinking that a bunch of big spenders in the technology sector means that all tech picks are doing well. In fact, a number of big name blue chips in the industry continue to face very difficult roads ahead.
Here are 11 blue chip tech stocks stumbling right now:
Microsoft ( MSFT )
Industry: Software
Market Cap: $205 billion
Microsoft (NASDAQ: MSFT ) is known globally for its Windows operating system. But lately, the tech stock has been known for its declines. The tech giant has dropped -22% in the last eight months, compared to the Dow Jones Industrial Average and NASDAQ, which have fallen -3.4% and -5.8% respectively. Currently, Microsoft is trading right around its 52-week low. Add the fact that experts are estimating a -6.8% drop in growth next quarter and Microsoft is definitely a blue chip stock worth selling.
Cisco ( CSCO )
Industry: Communications Equipment
Market Cap: $117 billion
Networking company Cisco Systems Inc. (NASDAQ: CSCO ) has had a less than stellar 2010. Since January, the tech company's stock has slid -14.3%, setting it behind broader markets. Additionally, experts are predicting earnings of $0.40 per share in its next quarterly report, which is down from an EPS of $0.43 last quarter. Up until May, Cisco stock had remained relatively stable on the year. Since May however, the stock has dropped -23.8%. CSCO is trading very close to its 52-week low of $20.36, with its current stock price of $20.45.
Hewlett-Packard ( HPQ )
Industry: Computers & Peripherals
Market Cap: $91 billion
Hewlett-Packard Co. (NYSE: HPQ ) has been making headlines over its 3Par bids, but none of the press has helped turn around HP stock. The tech giant has seen its stock underperform in 2010 as well. In fact, the tech stock has fallen -24.4% since January, including a -15.4% drop since the beginning of August. The bidding war over 3par could be a double-edged sword - if HP misses out, it could get punished. If it wins and overpays, shareholders may be just as angry.
Qualcomm ( QCOM )
Industry: Communications Equipment
Market Cap: $62 billion
Qualcomm INC (NASDAQ: QCOM ) is a designer, manufacturer and marketer of digital wireless telecommunications products based in San Diego. Thus far, QCOM stock has slid -17.2% in 2010. Currently the stock is up to $38.29, from its 52-week low of $31.63 in July. Experts are also predicting a growth estimate for the current quarter of -9.4%. Recently, competitor Intel (NASDAQ: INTC ) completed the buyout of Infineon's wireless chip unit, which means competitor QCOM may now be at a disadvantage on the mobile device front.
TaiwanSemiconductor ( TSM )
Industry: Semiconductors & Semiconductor Equipment
Market Cap: $49 billion
Primarily engaged in the research, manufacturing and distribution of integrated circuit related products, Taiwan Semiconductor Manufacturing Co (NYSE: TSM ) is another blue chip stock worth selling. Since January, the stock has fallen -17.7%, against small declines by the broader markets. Additionally, experts are not predicting growth for the company in the near future, as they have posted a -2.2% growth estimate for next year. The fact that Deutsche Bank has downgraded the semiconductor stock to a "hold" from a "buy" is also discouraging.
Nokia ( NOK )
Industry: Communications Equipment
Market Cap: $32 billion
Cell phone maker and communication company Nokia Corp. (NYSE: NOK ) has experienced the brunt of the competitive mobile phone market. Year-to-date, Nokia's stock has vastly underperformed, falling -34% in 2010. Over the past 12 months the company has seen a sharp decline of -39.5%. To make matters worse, Nokia has missed earnings estimates for the past two quarters, causing experts to scale back on their predictions for next quarter, with an earnings estimate of $0.14. A net profit margin of just 1% does not have investors thrilled about Nokia stock either.
Research in Motion ( RIMM )
Industry: Communication Equipment
Market Cap: $25 billion
Research in Motion Ltd. (NASDAQ: RIMM ) is famous for its signature Blackberry smartphone. Much like competitor Nokia, RIMM has had a rough go of it in 2010. The stock has slid -33.2% in the last eight months and -38.3% over the past year. That represents a loss of nearly $28 per share over a 12 month period. The smartphone market has been unkind to RIMM lately, as competitors Google ( GOOG ) and Apple are hitting it big with their Droid and iPhone smartphones. And with a recent report that iPhones are becoming more popular in the office , the corporate staple Blackberry may be out of style.
Dell ( DELL )
Industry: Computers & Peripherals
Market Cap: $23 billion
Personal Computer producer Dell Inc. (NASDAQ: DELL ) has seen its stock gradually decline nearly -18% in 2010. A shell of its former self, Dell stocks currently trade at $11.70, a -66.7% drop from August of 2005. InvestorPlace recently reported that Dell sales have dropped significantly due to reduced consumer spending, and corporate buying. Locked in a bidding war with Hewlett-Packard for the tech company 3Par, Dell may see its only real chance for revival slip away if HP makes the purchase. A net profit margin of just 3.5% last quarter is another reason why this clue chip tech stock is a sell.
Yahoo! ( YHOO )
Industry: Industry Software & Services
Market Cap: $18 billion
Based in California, Yahoo! Inc. (NASDAQ: YHOO ) has become a household name thanks to its aptly named website Yahoo.com. Despite the site's popularity, the company's stock has seen a drastic decline of -28.9% since mid-April. Year-to-date the stock is down -22.1%, and is just barely above its 52-week low of $13.03, with a stock price of $13.09. YHOO's stock has been sitting right around that 52-week low price for several weeks, proving that the Internet stock is anything but strong.
Adobe ( ADBE )
Industry: Software
Market Cap: $15 billion
Adobe Systems Inc. (NASDAQ: ADBE ) is a diversified software company that offers a line of creative, business, web and mobile software and services used by a variety of clients. Adobe's stock was down slightly through the first six months of 2010, and has seen a sharp drop of -16.4% since mid-June. Year-to-date the stock is down -24.7%, compared to minor declines in the broader markets. Like many of the other stocks on this list, Adobe is not trading much higher than its 52-week low of $26.01. The tech stock currently trades at $27.64.
Activision Blizzard ( ATVI )
Industry: Software
Market Cap: $13 billion
Activision Blizzard Inc. (NASDAQ: ATVI ) publishes video games for personal computers, gaming consoles and handheld devices. Year-to-date, Activision has seen a modest decline of -4.4%, and a 12-month drop of -8.5%. While Activision's stock performance has not been awful, shareholders must be disheartened by the performance based on the video-game company's releases over the past year. In November, Activision released Call of Duty: Modern Warfare 2 which has sold more than 20 million copies worldwide. More recently, Activision released Starcraft II in late July and sold more than one million copies in the first day. Despite huge sales, Activision stock has been treading water for the past year, which must certainly upset stockholders.
As of this writing, Louis Navellier did not own a position in any of the stocks named here.
5 Small Cap Stocks to Buy Now.Small, innovative companies are watching their earnings explode - and they are the next ten-baggers. Investing pro Louis Navellier reveals his secrets to identifying these small cap innovators, plus five of his favorite small cap stocks - download your FREE profit guide here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Locked in a bidding war with Hewlett-Packard for the tech company 3Par, Dell may see its only real chance for revival slip away if HP makes the purchase. With the merger war between Dell (NASDAQ: DELL ) and Hewlett Packard (NYSE: HPQ ) over 3Par (NYSE: PAR ) raging on, tech stocks have really been in focus lately. Dell ( DELL ) Industry: Computers & Peripherals Market Cap: $23 billion Personal Computer producer Dell Inc. (NASDAQ: DELL ) has seen its stock gradually decline nearly -18% in 2010.
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With the merger war between Dell (NASDAQ: DELL ) and Hewlett Packard (NYSE: HPQ ) over 3Par (NYSE: PAR ) raging on, tech stocks have really been in focus lately. Dell ( DELL ) Industry: Computers & Peripherals Market Cap: $23 billion Personal Computer producer Dell Inc. (NASDAQ: DELL ) has seen its stock gradually decline nearly -18% in 2010. A shell of its former self, Dell stocks currently trade at $11.70, a -66.7% drop from August of 2005.
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Dell ( DELL ) Industry: Computers & Peripherals Market Cap: $23 billion Personal Computer producer Dell Inc. (NASDAQ: DELL ) has seen its stock gradually decline nearly -18% in 2010. With the merger war between Dell (NASDAQ: DELL ) and Hewlett Packard (NYSE: HPQ ) over 3Par (NYSE: PAR ) raging on, tech stocks have really been in focus lately. A shell of its former self, Dell stocks currently trade at $11.70, a -66.7% drop from August of 2005.
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With the merger war between Dell (NASDAQ: DELL ) and Hewlett Packard (NYSE: HPQ ) over 3Par (NYSE: PAR ) raging on, tech stocks have really been in focus lately. Dell ( DELL ) Industry: Computers & Peripherals Market Cap: $23 billion Personal Computer producer Dell Inc. (NASDAQ: DELL ) has seen its stock gradually decline nearly -18% in 2010. A shell of its former self, Dell stocks currently trade at $11.70, a -66.7% drop from August of 2005.
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beb62f6e-32ef-4d41-ac5c-6a2bb6abbe0a
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727005.0
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2010-08-31 00:00:00 UTC
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3 Rules You Must Follow in This Market
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DELL
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https://www.nasdaq.com/articles/3-rules-you-must-follow-market-2010-08-31
|
nan
|
nan
|
Stocks traded lower on Monday, with volume drying up as we head into the Labor Day holiday. This put the market into the hands of traders who in very thin trading ignored takeover deals and rumors, and instead focused on economics.
Personal income for July increased 0.2% and spending increased 0.4% - income was slightly less than expected and spending just a bit more. But core personal consumption expenditures increased just 0.1%, and that was slightly less than expected. The big jobs report for August is due on Friday, and several economists said they felt that the unemployment rate would jump to 9.6% from 9.5% in July, and that's what the market focused on yesterday.
Several deals made headlines Monday, including the offer by drug maker Sanofi-Aventis (NYSE: SNY ) of $18.5 billion in cash for Genzyme Corporation (NASDAQ: GENZ ). Genzyme rejected the deal saying that it was "inadequate." GENZ rose 3.4% and SNY fell 1.1%.
And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. HP was the only Dow component to rise yesterday, up 1.5%, as it enjoyed the impact of an announcement during the weekend of a $10 billion buyback of its own stock. DELL gained 1.1%.
The U.S. dollar rose 0.3% against a basket of currencies. And Treasuries climbed with the 10-year note's yield at 2.53%.
At the close, the Dow Jones Industrial Average was down 141 points to 10,009, the S&P 500 lost 16 points to 1,049, and the Nasdaq was off 34 points at 2,120.
The NYSE traded 817 million shares with decliners over advancers by 3-to-1. The Nasdaq crossed 447 million shares with ahead by almost 4-to-1.
Crude oil for October delivery dropped 47 cents to $74.70 a barrel, as energy supplies are reported to be the highest in years due to the slow-growth economy. The Energy Select Sector SPDR (NYSE: XLE ) fell 76 cents, closing at $51.34.
December gold rose $1.30 to settle at $1,239.20 an ounce, and the PHLX Gold/Silver Sector Index (NASDAQ: XAU ) fell 1.28 points to 182.86.
What the Markets Are Saying
Traders who yesterday jumped on board the long side of the market on the opening were probably delighted to have a quick gain. But the problem was that the gain lasted for only several minutes before the longs were squeezed by short-sellers in a low-volume environment where just a relatively few traders can control the market for a day or so.
Those who trade stocks for a living are very familiar with the high volatility that accompanies a pre-holiday week, and they use that to their advantage.
Yesterday was the fifth consecutive day that the S&P 500 traded within the narrow zone of 1,040 to 1,065. Yesterday's high was 1,064.4 and its low was 1,048.79.
Where then should a trader try to position longs if the evidence is for the near-term trading trend to be bullish?
Here is the answer from yesterday's Daily Market Outlook , "Why do I mention the 1,040 support line again after harping on it for at least two weeks? Because some of our readers wondered why, after being on the bearish side of the market since late July, I should suddenly (in their minds) turn bullish and call for a trading bounce. The reason is very simple: Support lines usually support and resistance lines usually resist. And they function best when the majority of the public ignores their significance and goes with the near-term trend."
With the spread of 1,040 to 1,065, the "smart trader" who is operating in a volatile market will try to position at some point below the halfway mark of the established daily spreads and not "at the market, on the opening." Trades should be entered at no more than 1,052 with a stop-loss at under the two daily reversals at 1,040 - say at 1,037. And only limit orders, not market orders, should be entered when opening trading positions.
Why do I bring this up today? Because I read the e-mail responses to the Daily Market Outlook, and it seems that some of you jumped on the long side yesterday at the opening, at the market.
If you trade, you must have some basic rules, and yesterday provided a great lesson in trading discipline.
Here are some basic trading rules:
1. Determine the trading spread in a volatile market and only take long positions that are priced below the halfway point of the spread (shorts are the opposite).
2. Always use a limit order. Never initiate a new position with a market order.
3. Always enter a fixed stop-loss order at a point below the daily spread or support line that, if violated, could mean that the near-term trend has changed.
One of the best traders once told a class of trainees, "your first lost is your best loss." That's true only if those who day trade learn from their mistakes.
For the remainder of the week, I'll cover some other basic trading techniques. Tomorrow's topic will be how to learn from losses.
To see the support zones and resistance zones of the S&P 500, click here .
Today's Trading Landscape
Earnings to be reported before the opening include: China Gerui, Dollar General, DSW, Energy Conversion, Isle of Capri and K-Sea Transportation.
Earnings to be reported after the close include: ABM Industries, Accuray, Applied Signal, Concurrent and Danaos.
Economic reports due: ICSC-Goldman Sachs store sales, Redbook, S&P Case-Shiller Home Price Indices, Chicago PMI (the consensus expects 56), consumer confidence (the consensus expects 51), State Street Investor Confidence, FOMC minutes and farm prices.
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
The Secret to Banking Giant Options Gains- If you're ready to make serious money, we're talking about 100%-5,300% profits, read our just-released trading guide online now. In it we reveal the money-doubling secret we were banned from sharing, plus two free trades to get you started.Get your FREE copy here!
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. Several deals made headlines Monday, including the offer by drug maker Sanofi-Aventis (NYSE: SNY ) of $18.5 billion in cash for Genzyme Corporation (NASDAQ: GENZ ).
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And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. Personal income for July increased 0.2% and spending increased 0.4% - income was slightly less than expected and spending just a bit more.
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And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. With the spread of 1,040 to 1,065, the "smart trader" who is operating in a volatile market will try to position at some point below the halfway mark of the established daily spreads and not "at the market, on the opening."
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And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. What the Markets Are Saying Traders who yesterday jumped on board the long side of the market on the opening were probably delighted to have a quick gain.
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4c25da7d-e19c-4111-96bc-93927acc9af1
|
727006.0
|
2010-08-31 00:00:00 UTC
|
Short This Tech Blue Chip
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DELL
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https://www.nasdaq.com/articles/short-tech-blue-chip-2010-08-31
|
nan
|
nan
|
Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40.
In February 2009, the stock hit a bear market low under $8, and then rallied to $17 in September 2009. And following a pullback early this year, it rallied and again topped at $17.
This double-top led to a serious decline marked by a death cross in late June and a failure to rally above its 50-day moving average in August. Dell is in a bear market with little support in sight.
Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72. The trading target is $8.50 to $9.
Check with their broker for margin requirements and the ability to borrow stock for a short sale. Selling naked shorts is a violation of current SEC rules.
Selling short is also considered a speculative trade and not suitable for all investors. Short sellers are advised to always enter stop-loss orders in order to avoid unlimited losses.
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
The 10-to-1 Options Trading Secret- John Lansing reveals how to break down scientific chart analysis into easy-to-make trades that will have you trading, and profiting, with confidence in no time. Learn how to leverage your profits 10 times larger with a tiny investment. Download his FREE trading guide here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. This double-top led to a serious decline marked by a death cross in late June and a failure to rally above its 50-day moving average in August.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72.
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Dell Inc. (NASDAQ: DELL ) - This PC maker has been in a bear market since late 2004, when it double-topped at $40. Dell is in a bear market with little support in sight. Traders should consider selling the stock short at current prices or on rallies to the 50-day moving average now at $12.72.
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06d8d9ef-59b7-4010-8741-4fe28ae0da67
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727007.0
|
2010-08-31 00:00:00 UTC
|
M & A: Good News....or Bad?
|
DELL
|
https://www.nasdaq.com/articles/m-good-newsor-bad-2010-08-31
|
nan
|
nan
|
M & A. That's mergers and acquisitions. They're all over the financial pages. Intel is buying Infineon's wireless division for $1.4 billion so the chip manufacturer can diversify beyond computers. HP or Dell will end up with 3PAR, a cloud-computing company, at a cost of $2 billion or more. Carl Icahn, the billionaire financier, is making a hostile tender bid for Lions Gate, the film and television producer. 3M is buying Attenti Holdings, an Israeli maker of remote monitoring technology used to track people, for $230 million. Exelon is picking up a division of Deere, a renewable energy unit, for about $900 million so it can enter the wind-power segment. Sanofi-Aventis is trying to buy Genzyme but the board won't accept the bid of $18.5 billion. The board is open to better numbers. There are many more.
Is all this good for investors? Or is there some bad in there?
Certainly one of the good attributes, especially if you own the companies that are being bought, is that the price of the stock goes up. You can sell your stock for more today than you could a few days ago.
That leads to the next good part: investors (including management of the acquired companies) will have money to re-invest into the stock market or to buy goods or services. New liquidity, provided by the purchase, might loosen the purse strings of some of the holders, creating a little more demand in the economy. The same is true for stocks as investors look to replace a hole in their portfolios.
Another positive: corporations are starting to use the money they've accumulated. As mentioned in last week's column, if money provided by the Fed isn't used, it doesn't help the economy grow. With corporations spending billions, that money will flow into the pockets of investors who will most likely spend it, either on investments or goods and services.
Another one: when companies are willing to buy, it usually means valuations are attractive, that companies being bought are bargains. If they aren't, they are strategically important. But most M & A deals happen because the buyer's management think the acquired company will help earnings. The purchase price is a bargain compared to the stream of earnings that will follow. That suggests to investors that they should also be looking, that the time may be opportune to add to positions or start new ones, especially in sectors that are seeing the most M & A activity.
Wall Street is usually involved in these deals. And the fees are huge, always in the millions of dollars. That helps keep employment high on the Street as well as real estate prices in Manhattan. Is that good or bad? No comment.
One thing that is bad: look for layoffs in the companies that are bought. Usually the acquiring company wants to save money, especially when areas overlap, such as selling, general and administrative. If you work in one of the support divisions, say accounting, you may find yourself looking for another job. The acquiring company will most likely have a full accounting staff, able to incorporate the new duties. While this isn't always true, most M & A deals are followed by some job cuts, and most of those come from the acquired company.
Another negative aspect: competition is removed. While some of the above transactions are being made outside the buyer's markets, most M & A deals are done with a competitor. In this weakened economy, many large firms look to consolidate the industry and eliminate some of their competition (they can't eliminate all of it since that would go against the anit-trust laws). With competition lessened, it gives the suriving entity better pricing power and more marketing muscle. That usually translates into higher prices for consumers.
There are other aspects of M & A but these are ones that stand out for their significance. Investors should see them as good, especially if they own the stock of the acquired company. The economy, between the positive of the turnover of money, the new demand for stocks, goods and services and the negative of fewer jobs and less competition, may feel it as a wash. In general, at least for now, the balance would have to be tipped in the favor of good since all that money is starting to flow.
- Ted Allrich
August 31, 2010
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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HP or Dell will end up with 3PAR, a cloud-computing company, at a cost of $2 billion or more. Carl Icahn, the billionaire financier, is making a hostile tender bid for Lions Gate, the film and television producer. Exelon is picking up a division of Deere, a renewable energy unit, for about $900 million so it can enter the wind-power segment.
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HP or Dell will end up with 3PAR, a cloud-computing company, at a cost of $2 billion or more. With corporations spending billions, that money will flow into the pockets of investors who will most likely spend it, either on investments or goods and services. - Ted Allrich August 31, 2010 The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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HP or Dell will end up with 3PAR, a cloud-computing company, at a cost of $2 billion or more. That leads to the next good part: investors (including management of the acquired companies) will have money to re-invest into the stock market or to buy goods or services. Investors should see them as good, especially if they own the stock of the acquired company.
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HP or Dell will end up with 3PAR, a cloud-computing company, at a cost of $2 billion or more. Certainly one of the good attributes, especially if you own the companies that are being bought, is that the price of the stock goes up. While this isn't always true, most M & A deals are followed by some job cuts, and most of those come from the acquired company.
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2e6e8b41-443a-449d-9545-97df3b9735eb
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727008.0
|
2010-08-30 00:00:00 UTC
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Where to Find the Next Big Tech Deal
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DELL
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https://www.nasdaq.com/articles/where-find-next-big-tech-deal-2010-08-30
|
nan
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nan
|
After Dell (Nasdaq: DELL) and Hewlett-Packard ( HPQ ) started their bidding for data storage firm 3PAR ( PAR ) , investors quickly went in search of possible other deals, bidding up names of several rivals that may soon be bought out themselves.
[Read: This Company's 10-Day, +169% Run is Heating up an Entire Sector ]
So as Intel (Nasdaq: INTC) announces plans to acquire the wireless chip division of Germany-based Infineon Technologies, it makes sense to see what other firms might be in play. (We made a similar review when Intel announced plans to buy McAfee ( MFE ) .) [See: Why Today's Intel Deal Makes Tech Even More Appealing ]
The untethered revolution
Intel's decision to wade further into wireless technology is completely understandable. Smart phones and tablet computers are paving the way for a tech revolution that untethers us from cable modems and other desk-bound Internet connections. Industry watchers expect to see desktop-PC sales shrink and tablet sales rise in coming years.
Inifineon can boast of customers such as Nokia ( NOK ) , Research in Motion (Nasdaq: RIMM) and LG, but has barely made any profits on these chips that transmit wireless signals. Intel is likely less concerned about profits in the near-term and would instead like to find ways to boost market share in this fast-growing segment. That's also the probable logic behind any acquisitions of other wireless chip vendors.
In that context, U.K.-based ARM Holdings (Nasdaq: ARMH) may hold appeal to potential acquirers. ARM is not involved in wireless chips, but instead focuses on other chips that go into mobile devices. ARM's processors are quick and consume little power -- a key consideration for mobile devices. Shares of ARM have had a strong run and now appear fairly expensive, so it's not clear that the company would garner a significant buyout premium.
Other wireless communication plays
Investors may have a hard time finding a "pure-play" investment vehicle in this space. Infineon's key rivals, Qualcomm (Nasdaq: QCOM) and Samsung focus on a range of chip technologies and are surely too large to be swallowed up by one of the traditional large tech buyers. Instead, investors are likely to focus on smaller firms that are ancillary plays on the wireless revolution.
For example in the broader wireless space, Ceragon Networks (Nasdaq: CRNT) is helping emerging economies such as the Philippines and India build out wireless networks from scratch. In many parts of those countries, traditional wire line-based phone networks were never sufficient enough to handle large volumes of data traffic and are being leap-frogged by new wireless networks.
In the past few quarters, the company has posted results well ahead of forecasts. Sales are growing at a +30% pace this year and should grow at least half that rate next year. Yet its shares have taken a big hit in this sell-off (before a +10% rebound in Monday trading), and the price-to-earnings ratio (P/E) on projected 2011 EPS has fallen from 20 to 12 in just the past six months.
MIPS Technologies (Nasdaq: MIPS)
This company makes a wide range of chips, including those that help transmit wireless data. MIPS has tailored its most recent chip offerings to run seamlessly with Google's (Nasdaq: GOOG) Android software, which has led to an increasing number of design wins. To be sure, the company still derives the vast majority of sales from applications such as set-top boxes and advanced TV sets, but management has re-positioned the product line to derive a greater percentage of sales from mobile devices in coming years.
MIPS saw sales fall more than -30% in fiscal (June) 2009, thanks to a build-up in inventory of its chips at key customers. Inventories have subsequently been drawn down, and although full-year results were flat for 2010, the fiscal year finished on a very strong note, as fiscal fourth quarter sales were nearly +80% higher than a year earlier. Analysts expect sales to rise +10% to +15% both this year and next, but that forecast looks far too conservative in light of the company's recent new contract momentum.
Action to Take --> When a deal was announced for 3PAR two weeks ago, shares of rivals quickly moved up and have been rising ever since. Yet on the heels of this morning's Intel announcement, no takeover rumors have emerged and led to such gains among these chip rivals. But both Ceragon Networks and MIPS Technologies hold real merit on a standalone basis for investors, and would be even more valuable if a larger tech firm looking to move into this area made a bid.
-- David Sterman
David Sterman started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and a Managing Editor at TheStreet.com. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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After Dell (Nasdaq: DELL) and Hewlett-Packard ( HPQ ) started their bidding for data storage firm 3PAR ( PAR ) , investors quickly went in search of possible other deals, bidding up names of several rivals that may soon be bought out themselves. [Read: This Company's 10-Day, +169% Run is Heating up an Entire Sector ] So as Intel (Nasdaq: INTC) announces plans to acquire the wireless chip division of Germany-based Infineon Technologies, it makes sense to see what other firms might be in play. Inifineon can boast of customers such as Nokia ( NOK ) , Research in Motion (Nasdaq: RIMM) and LG, but has barely made any profits on these chips that transmit wireless signals.
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After Dell (Nasdaq: DELL) and Hewlett-Packard ( HPQ ) started their bidding for data storage firm 3PAR ( PAR ) , investors quickly went in search of possible other deals, bidding up names of several rivals that may soon be bought out themselves. [Read: This Company's 10-Day, +169% Run is Heating up an Entire Sector ] So as Intel (Nasdaq: INTC) announces plans to acquire the wireless chip division of Germany-based Infineon Technologies, it makes sense to see what other firms might be in play. [See: Why Today's Intel Deal Makes Tech Even More Appealing ] The untethered revolution Intel's decision to wade further into wireless technology is completely understandable.
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After Dell (Nasdaq: DELL) and Hewlett-Packard ( HPQ ) started their bidding for data storage firm 3PAR ( PAR ) , investors quickly went in search of possible other deals, bidding up names of several rivals that may soon be bought out themselves. [Read: This Company's 10-Day, +169% Run is Heating up an Entire Sector ] So as Intel (Nasdaq: INTC) announces plans to acquire the wireless chip division of Germany-based Infineon Technologies, it makes sense to see what other firms might be in play. For example in the broader wireless space, Ceragon Networks (Nasdaq: CRNT) is helping emerging economies such as the Philippines and India build out wireless networks from scratch.
|
After Dell (Nasdaq: DELL) and Hewlett-Packard ( HPQ ) started their bidding for data storage firm 3PAR ( PAR ) , investors quickly went in search of possible other deals, bidding up names of several rivals that may soon be bought out themselves. ARM is not involved in wireless chips, but instead focuses on other chips that go into mobile devices. MIPS Technologies (Nasdaq: MIPS) This company makes a wide range of chips, including those that help transmit wireless data.
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68d9d9bb-da12-4737-aed3-8b9722da4498
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727009.0
|
2010-08-30 00:00:00 UTC
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3 Rules You Must Follow in This Market
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DELL
|
https://www.nasdaq.com/articles/3-rules-you-must-follow-market-2010-08-30
|
nan
|
nan
|
Stocks traded lower on Monday, with volume drying up as we head into the Labor Day holiday. This put the market into the hands of traders who in very thin trading ignored takeover deals and rumors, and instead focused on economics.
Personal income for July increased 0.2% and spending increased 0.4% - income was slightly less than expected and spending just a bit more. But core personal consumption expenditures increased just 0.1%, and that was slightly less than expected. The big jobs report for August is due on Friday, and several economists said they felt that the unemployment rate would jump to 9.6% from 9.5% in July, and that's what the market focused on yesterday.
Several deals made headlines Monday, including the offer by drug maker Sanofi-Aventis (NYSE: SNY ) of $18.5 billion in cash for Genzyme Corporation (NASDAQ: GENZ ). Genzyme rejected the deal saying that it was "inadequate." GENZ rose 3.4% and SNY fell 1.1%.
And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. HP was the only Dow component to rise yesterday, up 1.5%, as it enjoyed the impact of an announcement during the weekend of a $10 billion buyback of its own stock. DELL gained 1.1%.
The U.S. dollar rose 0.3% against a basket of currencies. And Treasuries climbed with the 10-year note's yield at 2.53%.
At the close, the Dow Jones Industrial Average was down 141 points to 10,009, the S&P 500 lost 16 points to 1,049, and the Nasdaq was off 34 points at 2,120.
The NYSE traded 817 million shares with decliners over advancers by 3-to-1. The Nasdaq crossed 447 million shares with ahead by almost 4-to-1.
Crude oil for October delivery dropped 47 cents to $74.70 a barrel, as energy supplies are reported to be the highest in years due to the slow-growth economy. The Energy Select Sector SPDR (NYSE: XLE ) fell 76 cents, closing at $51.34.
December gold rose $1.30 to settle at $1,239.20 an ounce, and the PHLX Gold/Silver Sector Index (NASDAQ: XAU ) fell 1.28 points to 182.86.
What the Markets Are Saying
Traders who yesterday jumped on board the long side of the market on the opening were probably delighted to have a quick gain. But the problem was that the gain lasted for only several minutes before the longs were squeezed by short-sellers in a low-volume environment where just a relatively few traders can control the market for a day or so.
Those who trade stocks for a living are very familiar with the high volatility that accompanies a pre-holiday week, and they use that to their advantage.
Yesterday was the fifth consecutive day that the S&P 500 traded within the narrow zone of 1,040 to 1,065. Yesterday's high was 1,064.4 and its low was 1,048.79.
Where then should a trader try to position longs if the evidence is for the near-term trading trend to be bullish?
Here is the answer from yesterday's Daily Market Outlook , "Why do I mention the 1,040 support line again after harping on it for at least two weeks? Because some of our readers wondered why, after being on the bearish side of the market since late July, I should suddenly (in their minds) turn bullish and call for a trading bounce. The reason is very simple: Support lines usually support and resistance lines usually resist. And they function best when the majority of the public ignores their significance and goes with the near-term trend."
With the spread of 1,040 to 1,065, the "smart trader" who is operating in a volatile market will try to position at some point below the halfway mark of the established daily spreads and not "at the market, on the opening." Trades should be entered at no more than 1,052 with a stop-loss at under the two daily reversals at 1,040 - say at 1,037. And only limit orders, not market orders, should be entered when opening trading positions.
Why do I bring this up today? Because I read the e-mail responses to the Daily Market Outlook, and it seems that some of you jumped on the long side yesterday at the opening, at the market.
If you trade, you must have some basic rules, and yesterday provided a great lesson in trading discipline.
Here are some basic trading rules:
1. Determine the trading spread in a volatile market and only take long positions that are priced below the halfway point of the spread (shorts are the opposite).
2. Always use a limit order. Never initiate a new position with a market order.
3. Always enter a fixed stop-loss order at a point below the daily spread or support line that, if violated, could mean that the near-term trend has changed.
One of the best traders once told a class of trainees, "your first lost is your best loss." That's true only if those who day trade learn from their mistakes.
For the remainder of the week, I'll cover some other basic trading techniques. Tomorrow's topic will be how to learn from losses.
To see the support zones and resistance zones of the S&P 500, click here .
Today's Trading Landscape
Earnings to be reported before the opening include: China Gerui, Dollar General, DSW, Energy Conversion, Isle of Capri and K-Sea Transportation.
Earnings to be reported after the close include: ABM Industries, Accuray, Applied Signal, Concurrent and Danaos.
Economic reports due: ICSC-Goldman Sachs store sales, Redbook, S&P Case-Shiller Home Price Indices, Chicago PMI (the consensus expects 56), consumer confidence (the consensus expects 51), State Street Investor Confidence, FOMC minutes and farm prices.
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
The Secret to Banking Giant Options Gains- If you're ready to make serious money, we're talking about 100%-5,300% profits, read our just-released trading guide online now. In it we reveal the money-doubling secret we were banned from sharing, plus two free trades to get you started.Get your FREE copy here!
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. Several deals made headlines Monday, including the offer by drug maker Sanofi-Aventis (NYSE: SNY ) of $18.5 billion in cash for Genzyme Corporation (NASDAQ: GENZ ).
|
And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. Personal income for July increased 0.2% and spending increased 0.4% - income was slightly less than expected and spending just a bit more.
|
And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. With the spread of 1,040 to 1,065, the "smart trader" who is operating in a volatile market will try to position at some point below the halfway mark of the established daily spreads and not "at the market, on the opening."
|
And the battle for the acquisition of 3PAR Inc. (NYSE: PAR ) heated up when 3Par said that the offer by Hewlett-Packard Company (NYSE: HPQ ) at $30 was superior to Dell Inc.'s (NASDAQ: DELL ) offer of $27 that it had already accepted. DELL gained 1.1%. What the Markets Are Saying Traders who yesterday jumped on board the long side of the market on the opening were probably delighted to have a quick gain.
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0c713603-bbe1-4cdd-96f6-81efffaf723c
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727010.0
|
2010-08-30 00:00:00 UTC
|
Hewlett-Packard Company and Dell Inc. Continue Bidding War for 3PAR Inc.
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DELL
|
https://www.nasdaq.com/articles/hewlett-packard-company-and-dell-inc-continue-bidding-war-3par-inc-2010-08-30
|
nan
|
nan
|
The ATP tournaments just wrapped up here in Cincinnati, and my mind's still on the tennis courts. As such, the back-and-forth bidding war between Hewlett-Packard Company ( HPQ ) and Dell Inc. ( DELL ) over 3PAR Inc. ( PAR ) seems reminiscent of the Isner/Mahut Wimbledon match in June -- you know, the match that lasted over 10 hours. Isner eventually emerged victorious, but what about HPQ and DELL?
The two companies have been duking it out for weeks. It all started when HPQ made an unsolicited $24-per-share bid that trumped DELL's initial $18-per-share bid. The stakes have since been raised -- multiple times -- and now HPQ has the upper hand with its current bid of $30 per share. Let's take a quick look at these two opponents, shall we?
Hewlett-Packard Company ( HPQ )
HPQ has been struggling lately, but the stock's technical troubles were exacerbated when its former CEO Mark Hurd abruptly resigned at the beginning of August. Since then, HPQ has shed roughly 17% of its value, with its 10-day and 20-day moving averages pressuring the shares steadily lower throughout this time. In fact, HPQ hit a new 52-week low on Friday.
However, HPQ has rebounded from Friday's low, shooting ahead roughly 2.9% so far today. The stock is now challenging its 10-day moving average, which has not been surmounted since Aug. 4.
In fact, it seems that option players were counting on HPQ to rebound off Friday's lows, as evidenced by Friday's activity at the September 40 call. Roughly 5,300 contracts changed hands on this front-month call -- 71% at the ask price, indicating they were likely purchased. Open interest jumped by nearly 2,900 contracts over the weekend, confirming that fresh bullish positions were added here. With HPQ trading around $39.06, these 40-strike calls are out of the money by less than one point.
For the September series, peak call open interest of 21,993 contracts can be found at the 42 strike. With another 21,531 contracts now open at the 40 strike, the heavy accumulations of call open interest directly overhead could stall the stock's progress going forward.
Friday's bullish activity is nothing out of the ordinary for HPQ. The tech stock's Schaeffer's put/call open interest ratio (SOIR) is currently docked at 0.66, in the bullishly biased 18th annual percentile.
Meanwhile, in the past two weeks, traders on the International Securities Exchange (ISE) and Chicago Board Options Exchange ( CBOE ) have bought to open 3.3 calls for every put purchased, a ratio which ranks above 81% of all other readings taken during the last year. In other words, speculators on the ISE and CBOE have seldom initiated bullish bets on HPQ at a faster clip.
While HPQ has indeed bounced from its Friday nadir, the tech stock is by no means in the clear. With several layers of trendline resistance -- as well as potential options-related resistance -- looming overhead, HPQ has its work cut out for it. Should the shares be rejected at any of several resistance levels, a capitulation by the bulls could pressure the shares to new lows.
Dell Inc. ( DELL )
Sector peer DELL hasn't been doing so hot lately, either, with the tech stock down 18% year-to-date. Since the beginning of August, DELL has been range-bound in the $11.50 to $12.50 neighborhood, with the upper rail of this range reinforced by its descending 10-week moving average, now docked just above $12.50. This moving average has served as both support and resistance to DELL in the past, with the latter currently the case.
Understandably, option players have adopted a bearish attitude toward DELL recently, with the ISE reporting that 1.13 puts have been bought to open for every call purchased during the past few weeks. This ratio ranks in the 85th percentile of its annual range, suggesting that traders on the ISE have scooped up puts on DELL at a faster clip just 15% of the time during the past year.
Meanwhile, DELL sports a call-heavy SOIR of 0.57, which ranks just eight percentage points away from an annual bullish peak. The September 13 call is the most popular contract in the front-month series, with a respectable 20,130 contracts in open interest. Meanwhile, just 6,846 contracts can be found at the September 12 strike, which is site of peak put open interest.
Upon closer inspection, DELL's call-heavy SOIR may have been influenced by the shorts. Despite a 10% drop in short interest during the past two weeks, short interest still accounts for 3% of the stock's available float. As such, a portion of these out-of-the-money calls may have simply been purchased as hedges by the shorts.
For the record, the 10% drop in short interest did little -- if anything -- to help bolster the shares. With pessimism on the rise, and technical and options-related resistance looming overhead, DELL may continue to find itself range-bound, at least in the short term.
In conclusion , as long as the bidding war drags on, both HPQ and DELL will likely continue to struggle.
Click here for the new summer issue of SENTIMENT magazine
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Understandably, option players have adopted a bearish attitude toward DELL recently, with the ISE reporting that 1.13 puts have been bought to open for every call purchased during the past few weeks. This ratio ranks in the 85th percentile of its annual range, suggesting that traders on the ISE have scooped up puts on DELL at a faster clip just 15% of the time during the past year. With pessimism on the rise, and technical and options-related resistance looming overhead, DELL may continue to find itself range-bound, at least in the short term.
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This ratio ranks in the 85th percentile of its annual range, suggesting that traders on the ISE have scooped up puts on DELL at a faster clip just 15% of the time during the past year. As such, the back-and-forth bidding war between Hewlett-Packard Company ( HPQ ) and Dell Inc. ( DELL ) over 3PAR Inc. ( PAR ) seems reminiscent of the Isner/Mahut Wimbledon match in June -- you know, the match that lasted over 10 hours. Isner eventually emerged victorious, but what about HPQ and DELL?
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As such, the back-and-forth bidding war between Hewlett-Packard Company ( HPQ ) and Dell Inc. ( DELL ) over 3PAR Inc. ( PAR ) seems reminiscent of the Isner/Mahut Wimbledon match in June -- you know, the match that lasted over 10 hours. Dell Inc. ( DELL ) Sector peer DELL hasn't been doing so hot lately, either, with the tech stock down 18% year-to-date. Understandably, option players have adopted a bearish attitude toward DELL recently, with the ISE reporting that 1.13 puts have been bought to open for every call purchased during the past few weeks.
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Meanwhile, DELL sports a call-heavy SOIR of 0.57, which ranks just eight percentage points away from an annual bullish peak. As such, the back-and-forth bidding war between Hewlett-Packard Company ( HPQ ) and Dell Inc. ( DELL ) over 3PAR Inc. ( PAR ) seems reminiscent of the Isner/Mahut Wimbledon match in June -- you know, the match that lasted over 10 hours. Isner eventually emerged victorious, but what about HPQ and DELL?
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e636402c-0b71-459e-84fd-51b72583cbe1
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727011.0
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2010-08-27 00:00:00 UTC
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Opening View: The Battle for 10,000; DJIA Futures Higher Before Fed and GDP
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DELL
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https://www.nasdaq.com/articles/opening-view-battle-10000-djia-futures-higher-fed-and-gdp-2010-08-27
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nan
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nan
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The Dow Jones Industrial Average (DJIA) closed below the 10,000 level yesterday for the first time since July 6, as a late-session sell-off finally overwhelmed the blue-chip barometer. However, with second-quarter gross domestic product ( GDP ) and a speech from Federal Reserve Chairman Ben Bernanke on tap later today, the situation could change rather quickly. In fact, optimism appears to be creeping onto Wall Street, as futures on the DJIA and the S&P 500 Index (SPX) are trading 25 points and 3 points above fair value, respectively. For support, watch the 9,950 and 9,800 levels for the Dow, and the 1,040 and 1,035 areas for the SPX. On the upside, 10,100 could be a major sticking point for the DJIA, while 1,060 remains a short-term ceiling for the SPX. Finally, keep a close eye on the 28-29 region for the CBOE Market Volatility Index (VIX), as a breakout above this region could mean a continued march higher for market volatility.
In equity news, Dell Inc. ( DELL ) fired another volley in the bidding war for 3PAR Inc. (PAR), lifting its bid for a second time in response to a competing bid from rival Hewlett-Packard Co. ( HPQ ). Dell's current offer stands at $27 per share in cash for the data storage company, valuing the firm at $1.8 billion. Late last night, HPQ raised its offer to $27 per share from $24 per share, after Dell lifted its initial offer to $24.30 per share from $18 per share. In a separate release, 3PAR accepted Dell's buyout offer of $27 per share. The deal is expected to close before the end of the year.
Elsewhere, Tiffany & Co. ( TIF ) posted a second-quarter profit of $67.7 million, or 53 cents per share, as sales in the Americas rose 8% to $668.8 million. Wall Street was expecting earnings of 53 cents per share on sales of $691.7 million. Looking ahead, Tiffany expects fiscal 2010 earnings from continuing operations of $2.60 to $2.65 per share, ahead of analysts' expectations for earnings of $2.59 per share.
Finally, Novell Inc. ( NOVL ) reported that its fiscal third-quarter net income fell to $15.7 million, or 4 cents per share, as revenue dropped to $199 million. Excluding special items, Novell said earnings for the period were 6 cents per share. Analysts had expected the company to post earnings excluding items of 7 cents per share on $201.2 million in revenue.
Earnings Preview
On the earnings front, Frontline Ltd. ( FRO ) is scheduled to release its quarterly earnings report today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
We round out the week today with a second look at second-quarter U.S. gross domestic product and the final reading on the University of Michigan's August consumer sentiment index.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 814,966 call contracts traded on Thursday, compared to 546,917 put contracts. The resultant single-session put/call ratio arrived at 0.67, while the 21-day moving average held at 0.64.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Click here for the new summer issue of SENTIMENT magazine
Overseas Trading
Overseas trading has a positive bias this morning, as seven of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a gain of 0.10%. In Asia, regional markets advanced despite sentiment pressures following the Dow's close below 10,000 on Wall Street. However, Japanese shares recovered following reports the prime minister may finally directly address the yen's recent surge versus the U.S. dollar. Trading in Europe, meanwhile, is mixed as regional indexes attempt to extend Thursday's tentative rebound.
Currencies and Commodities
Equities may be headed higher, but currencies and commodities are trading close to breakeven ahead of this morning's economic data. First up, the U.S. Dollar Index is fractionally lower in pre-market trading, slipping 0.02% to 82.92 at last check. Meanwhile, crude futures have a positive bias, with the lead contract up 20 cents at $73.56 per barrel. Finally, gold futures are up $1.90 at $1,239.60 an ounce in London. Don't expect much from this trio until second-quarter GDP and Ben Bernanke have their say.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In equity news, Dell Inc. ( DELL ) fired another volley in the bidding war for 3PAR Inc. (PAR), lifting its bid for a second time in response to a competing bid from rival Hewlett-Packard Co. ( HPQ ). Dell's current offer stands at $27 per share in cash for the data storage company, valuing the firm at $1.8 billion. Late last night, HPQ raised its offer to $27 per share from $24 per share, after Dell lifted its initial offer to $24.30 per share from $18 per share.
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In equity news, Dell Inc. ( DELL ) fired another volley in the bidding war for 3PAR Inc. (PAR), lifting its bid for a second time in response to a competing bid from rival Hewlett-Packard Co. ( HPQ ). Dell's current offer stands at $27 per share in cash for the data storage company, valuing the firm at $1.8 billion. Late last night, HPQ raised its offer to $27 per share from $24 per share, after Dell lifted its initial offer to $24.30 per share from $18 per share.
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Late last night, HPQ raised its offer to $27 per share from $24 per share, after Dell lifted its initial offer to $24.30 per share from $18 per share. In equity news, Dell Inc. ( DELL ) fired another volley in the bidding war for 3PAR Inc. (PAR), lifting its bid for a second time in response to a competing bid from rival Hewlett-Packard Co. ( HPQ ). Dell's current offer stands at $27 per share in cash for the data storage company, valuing the firm at $1.8 billion.
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In equity news, Dell Inc. ( DELL ) fired another volley in the bidding war for 3PAR Inc. (PAR), lifting its bid for a second time in response to a competing bid from rival Hewlett-Packard Co. ( HPQ ). Dell's current offer stands at $27 per share in cash for the data storage company, valuing the firm at $1.8 billion. Late last night, HPQ raised its offer to $27 per share from $24 per share, after Dell lifted its initial offer to $24.30 per share from $18 per share.
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f11982a9-d7f6-4252-84c3-3c889352b1c2
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727012.0
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2010-08-26 00:00:00 UTC
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Durable Goods Report: Mixed Signals From Tech
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DELL
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https://www.nasdaq.com/articles/durable-goods-report-mixed-signals-tech-2010-08-26
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nan
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nan
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Trade Radar Operator submits:
The advanced report for Durable Goods for July was released Wednesday and it was pretty dismal.
The fact that the market managed to advance in the face of this report almost makes me think that a rally is in the offing. This is the second instance of bad news leading to gains in stocks. The first was the homebuilders stocks rallying after the horrific existing home sales report on Tuesday. And today we have the overall market gaining even though this report clearly shows one of the green shoots of the economy showing signs of wilting.
In any case, here are some of the highlights of this latest report:
New orders for manufactured durable goods in July increased $0.6 billion or 0.3 percent to $193.0 billion. Excluding transportation (primarily aircraft) new orders decreased 3.8 percent. (Yikes!) Excluding defense, new orders increased 0.3 percent.
Shipments, up four of the last five months, increased $4.4 billion or 2.2 percent to $200.6 billion. Transportation equipment, had the largest increase, $3.4 billion or 6.9 percent to $52.7 billion.
Unfilled orders, down following three consecutive monthly increases, decreased $1.1 billion or 0.1 percent to $802.8 billion. Computers and electronic products, down following four consecutive monthly increases, had the largest decrease, $0.5 billion or 0.4 percent to $121.1 billion.
Inventories, up seven consecutive months, increased $1.8 billion or 0.6 percent to $311.2 billion. This followed a 1.3 percent June increase.
Capital Goods. Nondefense new orders for capital goods in July decreased 2.8 percent to $64.1 billion. Shipments increased 1.4 percent to $64.7 billion. Unfilled orders decreased 0.1 percent to $487.2 billion. Inventories increased 0.8 percent to $129.8 billion. Defense new orders for capital goods in July decreased 2.2 percent to $9.5 billion. Shipments decreased 2.4 percent to $9.5 billion. Unfilled orders decreased slightly to $139.7 billion. Inventories increased slightly or 0.1 percent to $17.9 billion.
Revised June Data -- all categories of June data were revised upward slightly
As always, I'll take a closer look at the tech sector. I wish I had better news to report.
Shipments
I generally give less importance to Shipments since this is a backward looking measure reflecting orders that have been confirmed, manufactured and shipped. It's similar to earnings reports -- it's good to know but the data is in the past and we're more interested in the future. The following chart shows how July shipments look for the overall tech sector:
Despite all the bad press on the headline numbers, you can see that the overall Tech sector managed a pretty strong July with shipments hitting a post-recession high (just barely).
Looking a little deeper, we can see that signs of weakness are beginning to appear. Here is the chart for the Computers and Related Products sub-sector:
You can see that shipments have stagnated for the last few months and the latest data point has dropped to the 6-month moving average. Not exactly a sign of doom, but still worrisome.
New Orders
Here is where the bad news is lurking. Here's the chart of new orders for the entire tech sector:
This the second month in a row where new orders have decreased and now this month they slid under the 6-month moving average.
Where things get really dicey is in the Computers and Related Products category:
Whereas the decrease in new orders is only 2.4% for the tech sector as a whole, we have a sickening 12.7% drop in the Computers sub-sector. Interestingly, it has been exactly two years since this category endured a drop of this magnitude. What kind of impact might this have on Dell ( DELL ) or H-P ( HPQ ) or even Intel ( INT )?
We find a bit of good news at the bottom of the barrel. There is a little uptick in the chart of new orders for Communications Equipment:
Nevertheless, the uptick doesn't manage to rise above the 6-month moving average which, incidentally, is still heading downward. No wonder Cisco Systems ( CSCO ) was cautious in their most recent earnings conference call.
Conclusion
The headline numbers surprised economists, coming in significantly weaker than expected. Last month, I looked at the numbers for the tech sector and said that after two months of decreases in shipments, it would be important for July to show a gain. It's a relief that the gain did indeed materialize but, as noted above, the sharp drop in new orders is raising a serious alarm.
If you're a pessimist, you can look at these charts and say tech is dead on arrival. With new orders breaking down so badly, tech is running into that most over-used of words: headwinds.
If you're an optimist, you can look at these charts and say that the data bounces around on both sides of the 6-month moving averages. Tech certainly seems to be taking a breather but it is not a done deal that the sector has thrown in the towel. This is especially true since the summer months tend to be somewhat of a weak seasonal period for tech. So, though the caution flags are certainly waving, full-on bearishness is not yet warranted here.
Still, as I look for a good entry point in a semiconductor ETF (why semis? read the post Analysts can't agree on outlook for semiconductors - what's an investor to do? ), this durable goods report gives me pause. Tech remains at a tipping point, perhaps tipping a little further toward weakness than I had expected. Once again, we await next months' numbers. Will it be game over or recovery back on track?
Disclosure: Small position in ROM, the ProShares Ultra Technology ETF, no positions in other companies mentioned in this post
See also Cramer's Mad Money - The Greatest Retail Stock of All Time (9/14/10) on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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What kind of impact might this have on Dell ( DELL ) or H-P ( HPQ ) or even Intel ( INT )? Trade Radar Operator submits: The advanced report for Durable Goods for July was released Wednesday and it was pretty dismal. The following chart shows how July shipments look for the overall tech sector: Despite all the bad press on the headline numbers, you can see that the overall Tech sector managed a pretty strong July with shipments hitting a post-recession high (just barely).
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What kind of impact might this have on Dell ( DELL ) or H-P ( HPQ ) or even Intel ( INT )? In any case, here are some of the highlights of this latest report: New orders for manufactured durable goods in July increased $0.6 billion or 0.3 percent to $193.0 billion. Unfilled orders, down following three consecutive monthly increases, decreased $1.1 billion or 0.1 percent to $802.8 billion.
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What kind of impact might this have on Dell ( DELL ) or H-P ( HPQ ) or even Intel ( INT )? In any case, here are some of the highlights of this latest report: New orders for manufactured durable goods in July increased $0.6 billion or 0.3 percent to $193.0 billion. Unfilled orders, down following three consecutive monthly increases, decreased $1.1 billion or 0.1 percent to $802.8 billion.
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What kind of impact might this have on Dell ( DELL ) or H-P ( HPQ ) or even Intel ( INT )? The following chart shows how July shipments look for the overall tech sector: Despite all the bad press on the headline numbers, you can see that the overall Tech sector managed a pretty strong July with shipments hitting a post-recession high (just barely). Here's the chart of new orders for the entire tech sector: This the second month in a row where new orders have decreased and now this month they slid under the 6-month moving average.
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ffd445ab-1466-4b04-a82b-b7d816015998
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727013.0
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2010-08-25 00:00:00 UTC
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Rising Storage Market Share Should Boost NetApp Stock
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DELL
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https://www.nasdaq.com/articles/rising-storage-market-share-should-boost-netapp-stock-2010-08-25
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nan
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nan
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NetApp ( NTAP ) creates innovative storage and data management solutions for small and medium-sized companies around the world. It competes mainly with EMC ( EMC ), IBM ( IBM ), HP ( HPQ ) and Dell ( DELL ) in the external disk storage systems market.
Netapp has created a strong brand for itself over the years, winning numerous awards and building a large list of loyal customers. A recent survey by Storage magazine ranked NetApp first in enterprise array quality. And the company's RTP data center was the first to earn the U.S. government's Energy Star rating for superior energy efficiency.
Based on the company's rising share of the external storage market and its promising partnerships with Microsoft, Cisco and others, we have raised the Trefis stock price estimate for NetApp from $33.54 to $41.56. Our analysis follows below.
Growing market share
NetApp's share of the external storage market has grown steadily in recent years. NetApp is currently the third-largest external storage player after IBM and Dell , according to market research firm IDC. We expect its share to rise further during the Trefis forecast period, from around 11% in 2010 to nearly 13% by 2016.
You can drag the trend-line in the chart below to create your own storage market share forecast for Netapp and see how it impacts the company's estimated stock price.
Productive partnerships
NetApp partners with VMware ( VMW ) and Cisco ( CSCO ) to provide integrated data center solutions. Netapp's FCoE solutions, Cisco's data center switches and VMware's virtualization technology combine to help corporate data centers work more efficiently.
NetApp has also embarked on a cloud computing partnership with Microsoft ( MSFT ). Cloud computing is a form of IT hosting in which resources such as servers are pooled for the simultaneous use of many customers. Numerous enterprises worldwide have been moving their IT infrastructures onto the cloud, which is often cheaper and more efficient than running a proprietary data data center.
In the earnings report for the first quarter of its 2011 fiscal year , NetApp announced that it was working with Microsoft and other companies to help enterprise clients make the jump to cloud computing. The Microsoft partnership involves integrating various NetApp and Microsoft applications in an effort to help business customers navigate virtualized IT environments.
You can seethe complete $41.56 Trefis price estimate for Netapp's stock here .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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It competes mainly with EMC ( EMC ), IBM ( IBM ), HP ( HPQ ) and Dell ( DELL ) in the external disk storage systems market. NetApp is currently the third-largest external storage player after IBM and Dell , according to market research firm IDC. Based on the company's rising share of the external storage market and its promising partnerships with Microsoft, Cisco and others, we have raised the Trefis stock price estimate for NetApp from $33.54 to $41.56.
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It competes mainly with EMC ( EMC ), IBM ( IBM ), HP ( HPQ ) and Dell ( DELL ) in the external disk storage systems market. NetApp is currently the third-largest external storage player after IBM and Dell , according to market research firm IDC. Based on the company's rising share of the external storage market and its promising partnerships with Microsoft, Cisco and others, we have raised the Trefis stock price estimate for NetApp from $33.54 to $41.56.
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It competes mainly with EMC ( EMC ), IBM ( IBM ), HP ( HPQ ) and Dell ( DELL ) in the external disk storage systems market. NetApp is currently the third-largest external storage player after IBM and Dell , according to market research firm IDC. Based on the company's rising share of the external storage market and its promising partnerships with Microsoft, Cisco and others, we have raised the Trefis stock price estimate for NetApp from $33.54 to $41.56.
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It competes mainly with EMC ( EMC ), IBM ( IBM ), HP ( HPQ ) and Dell ( DELL ) in the external disk storage systems market. NetApp is currently the third-largest external storage player after IBM and Dell , according to market research firm IDC. Based on the company's rising share of the external storage market and its promising partnerships with Microsoft, Cisco and others, we have raised the Trefis stock price estimate for NetApp from $33.54 to $41.56.
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9205fbef-1428-4441-acc3-cd13bafba0e7
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727014.0
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2010-08-25 00:00:00 UTC
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The Best DRIP on the Market Pays a Solid 6.4%
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DELL
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https://www.nasdaq.com/articles/best-drip-market-pays-solid-64-2010-08-25
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nan
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nan
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When the topic is the current market, a lot of pundits like to talk about "the new normal" -- that is to say, a range-bound stock market confined by a slow-growth economy .
But when it comes to finding decent long-term returns, there's never been a more tried-and-true method than dividends. In fact, studies from Standard & Poor's estimate that dividends have accounted for about 44% of the stock market's total return during the past 80 years.
A solid dividend-paying stock can offer significant downside protection in the market. Even better, when dividends are reinvested, you can build enormous wealth over time. For example, $10,000 invested into the S&P 500 in the third fiscal quarter of 1990 would leave you with about $23,700 today on price appreciation alone. But with dividends factored in, you'd have about $40,600 -- four times your initial investment and almost twice as much as without dividends.
Reinvesting dividends is incredibly simple. All you need is a good dividend reinvestment plan , or DRIP, to get started.
A DRIP is a type of account that lets individual investors buy shares directly from a company rather than from a broker. Shares are bought in one of two ways:
1) Direct purchase. This is when the account holder puts money in the account to buy shares of the public company offering the plan. Most DRIP account holders opt to buy shares at regular intervals, and are allowed to make transactions for as little as $25.
2) Dividend reinvestment. DRIP account holders can opt to reinvest their dividends in additional shares.
Most DRIPs are a real service to investors. Once all the initial legwork is done (finding a good dividend-paying stock to hold for the long-term, registering with the DRIP, and choosing the intervals with which to purchase shares), a DRIP helps take care of an important psychological component of investing: it enforces discipline.
Look for dividend-paying stocks with solid fundamentals and a track record of staying healthy in any market environment. This will save you the agony of sleepless nights worrying about whether the market is up or down. In the long-run, you as a DRIP investor win because you have two inevitable forces on your side: compounding and time.
With these points in mind, I went on a hunt to find the best DRIP on the market using the following criteria:
-- Market capitalization of at least $250 million
-- Currently yielding at least +5%
-- Dividend payout ratio of less than 80%
Here's what I found:
Any of the utilities in the table above would make a good option for conservative investors, but generally speaking the sector leaves a little to be desired for capital appreciation . Tobacco names such as Altria ( MO ) and Universal ( UVV ) offer nice payouts, but as my colleague David Sterman recently noted, the tobacco industry is in decline and should be avoided. [Read: Don't be Fooled by These High-Yield Stocks ]
For my money, the best DRIP on the market is AT&T ( T ) . The company's unrivaled high-speed Internet subscriber base, U-verse broadband television service, fixed-line telephone and wireless phone divisions make it a diversified cash cow and a dividend investor's dream.
AT&T's wireless division comprises almost half of sales and looks to be the company's next big cash cow, as its fixed-line business continues a slow decline. To combat the impact of data-hungry smartphone users on its network, AT&T has changed its wireless data pricing plans, eliminating its $30 a month unlimited plan and imposing penalties on customers who exceed their limits. AT&T customers have often complained of slow download speeds, and combined with increased spending and upgrades, this should ease the strain going forward.
It's true that the AT&T is heavily dependent on Apple's (Nasdaq: AAPL) iPhone and could one day lose its exclusivity agreement. But aside from network improvements and other offerings such as Dell's (Nasdaq: DELL) new Aero smartphone, the company is working to improve customer loyalty with better pricing. Until the day comes when it loses exclusivity, it is little cause for concern.
Action to Take --> If AT&T's new mobile pricing plans and network improvements take hold and the company can stay one step ahead of Verizon, the stock should make for a great long-term core holding for any investor.
AT&T's dividend payout ratio of 61.6% last quarter means that the company is paying out less than two-thirds of earnings -- plenty of room to be considered a safe payout ($3.9 billion in cash flow helps, too). In fact, AT&T has a stellar track record of boosting dividends: the payout has grown an average of +5.5% annually during the past five years.
At 12.5 times earnings, the stock is reasonably valued, but it hasn't offered an average yield higher than 5% in the past five years, making right now a great name to get in for the long-haul.
-- Brad Briggs
A graduate of Baylor University, Brad joined StreetAuthority in 2008 after working in the banking industry and at The Texas Observer. Brad's researching experience includes... Read more.
Disclosure: Neither Brad Briggs nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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But aside from network improvements and other offerings such as Dell's (Nasdaq: DELL) new Aero smartphone, the company is working to improve customer loyalty with better pricing. The company's unrivaled high-speed Internet subscriber base, U-verse broadband television service, fixed-line telephone and wireless phone divisions make it a diversified cash cow and a dividend investor's dream. AT&T's wireless division comprises almost half of sales and looks to be the company's next big cash cow, as its fixed-line business continues a slow decline.
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But aside from network improvements and other offerings such as Dell's (Nasdaq: DELL) new Aero smartphone, the company is working to improve customer loyalty with better pricing. Once all the initial legwork is done (finding a good dividend-paying stock to hold for the long-term, registering with the DRIP, and choosing the intervals with which to purchase shares), a DRIP helps take care of an important psychological component of investing: it enforces discipline. StreetAuthority The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. © Copyright 2001-2010 StreetAuthority, LLC.
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But aside from network improvements and other offerings such as Dell's (Nasdaq: DELL) new Aero smartphone, the company is working to improve customer loyalty with better pricing. Once all the initial legwork is done (finding a good dividend-paying stock to hold for the long-term, registering with the DRIP, and choosing the intervals with which to purchase shares), a DRIP helps take care of an important psychological component of investing: it enforces discipline. With these points in mind, I went on a hunt to find the best DRIP on the market using the following criteria: -- Market capitalization of at least $250 million -- Currently yielding at least +5% -- Dividend payout ratio of less than 80% Here's what I found: Any of the utilities in the table above would make a good option for conservative investors, but generally speaking the sector leaves a little to be desired for capital appreciation .
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But aside from network improvements and other offerings such as Dell's (Nasdaq: DELL) new Aero smartphone, the company is working to improve customer loyalty with better pricing. All you need is a good dividend reinvestment plan , or DRIP, to get started. Once all the initial legwork is done (finding a good dividend-paying stock to hold for the long-term, registering with the DRIP, and choosing the intervals with which to purchase shares), a DRIP helps take care of an important psychological component of investing: it enforces discipline.
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a071d1db-0cfb-4449-b83e-418dc9524d54
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727015.0
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2010-08-25 00:00:00 UTC
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How Hewlett-Packard Lost Its Luster in 3 Weeks
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DELL
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https://www.nasdaq.com/articles/how-hewlett-packard-lost-its-luster-3-weeks-2010-08-25
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nan
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nan
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Chad Brand
It is always interesting how quickly the investor community can turn its back on a company. Technology giant Hewlett-Packard ( HPQ ) has seen its support wither after its CEO Mark Hurd resigned over questionable behavior earlier this month. HP's stock has cratered nearly 20%, from above $46 to around $38 per share, and all of the sudden investors insist that HP has lost its way. The loss of Hurd is definitely a negative, but should the tables be turning on HP this dramatically already?
Fueling that argument is the news this week that HP decided to enter a bidding war with Dell ( DELL ) over 3Par ( PAR ) , a small data storage company. After initially being courted by four companies, Dell and HP were the finalists to acquire 3Par but HP had been previously unwilling to outbid Dell's $18 per share offer. However, after Dell and 3Par announced the deal HP decided to bid $24 and try to steal it from their competitor. Sporadic behavior on HP's part? It sure seems like it, as the critics were quick to point out, but maybe HP simply had a change of heart. Maybe Mark Hurd was against a higher offer and now that he is gone top management at HP decided they really should acquire the company. Who knows.
What we do know, however, is that HP has lost its CEO and is now willing to pay at least $1.6 billion to fill out its product line. Are these actions worth a nearly 20% hit to HP's stock price? Given that HP shares were cheap to being with, I think the sell-off is overdone, as is the bearish sentiment toward the company all of the sudden. At $38, HP stock trades at merely 8.5x fiscal 2010 earnings estimates (there are only two months left in its fiscal year, so readers need not complain that I am failing to use trailing earnings, which would make the P/E ratio 10.7). And yes, using 2011 estimates of 11% profit growth (to $5 per share), HP's forward P/E stands at just 7.7 times.
The risks here appear to be both obvious and less than dramatic. Could the absence of Mark Hurd send the company into an operational tailspin which would reduce market share and hurt profits? Possible, but unlikely. Hurd's top lieutenants remain at the company and are very likely to continue the management style and game plan he has had in place for several years.
Could overpaying for 3Par hurt the company's finances dramatically? No chance, as HP has cash on hand of $14.7 billion.
Could Dell adding 3Par to its arsenal materially cut into HP's business? Unlikely. 3Par generates only about $200 million in annual sales; a drop in the bucket for a company the size of Dell ($60 billion in sales) or HP ($125 billion in sales annually).
Could the empty CEO job cost HP some customers? Unlikely. As a CTO, would you switch vendors if you have had good experiences in the past, simply because the company's previous CEO allegedly charged personal expenses to the company in what could have been an attempt to woo a female contractor? You would probably agree with me that giving him the boot should suffice.
To me it is pretty clear that HP's stock is getting unfairly punished lately. As a long term value opportunity, I think it looks attractive.
Disclosure: Long shares of HPQ at the time of writing, but positions may change at any time.
See also HP Continues Its Business Makeover With ArcSight Acquisition on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Fueling that argument is the news this week that HP decided to enter a bidding war with Dell ( DELL ) over 3Par ( PAR ) , a small data storage company. After initially being courted by four companies, Dell and HP were the finalists to acquire 3Par but HP had been previously unwilling to outbid Dell's $18 per share offer. However, after Dell and 3Par announced the deal HP decided to bid $24 and try to steal it from their competitor.
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3Par generates only about $200 million in annual sales; a drop in the bucket for a company the size of Dell ($60 billion in sales) or HP ($125 billion in sales annually). Fueling that argument is the news this week that HP decided to enter a bidding war with Dell ( DELL ) over 3Par ( PAR ) , a small data storage company. After initially being courted by four companies, Dell and HP were the finalists to acquire 3Par but HP had been previously unwilling to outbid Dell's $18 per share offer.
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After initially being courted by four companies, Dell and HP were the finalists to acquire 3Par but HP had been previously unwilling to outbid Dell's $18 per share offer. 3Par generates only about $200 million in annual sales; a drop in the bucket for a company the size of Dell ($60 billion in sales) or HP ($125 billion in sales annually). Fueling that argument is the news this week that HP decided to enter a bidding war with Dell ( DELL ) over 3Par ( PAR ) , a small data storage company.
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After initially being courted by four companies, Dell and HP were the finalists to acquire 3Par but HP had been previously unwilling to outbid Dell's $18 per share offer. Fueling that argument is the news this week that HP decided to enter a bidding war with Dell ( DELL ) over 3Par ( PAR ) , a small data storage company. However, after Dell and 3Par announced the deal HP decided to bid $24 and try to steal it from their competitor.
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c48e0ca4-2876-4269-8952-70d4523a85e0
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727016.0
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2010-08-24 00:00:00 UTC
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Apple iPad Not Hurting Mac Sales
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DELL
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https://www.nasdaq.com/articles/apple-ipad-not-hurting-mac-sales-2010-08-24
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nan
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nan
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So far, Apple's popular iPad tablet does not appear to be cannibalizing the company's PC sales. Apple ( AAPL ) recently announced that its share of the PC market hit 4.19% in the second quarter of 2010, up from 3.49% in the first quarter. Apple competes with other PC manufacturers like Dell ( DELL ) and HP ( HPQ ).
Apple's PC share gains came despite the April 3 launch of the iPad. Considering Apple's robust PC market performance, it does not appear that many consumers are choosing iPads over Apple Macintosh notebook or desktop PCs. We believe this could be due to the halo effect that the ballyhooed iPad launch created around all Apple products, including Macs.
It remains to be seen whether iPad will become a cannibalistic threat to the Mac in the long term. Our analysis follows below.
Mac share forecast
According to management , Apple sold 3.47 million Macs in the second quarter of 2010, which is 18% more than the 2.94 million Macs sold in the first quarter. Worldwide PC shipments totalled 82.87 million in Q2 of 2010, down from 84.37 million in Q1, according to Gartner, a tech market research firm. Meanwhile, we expect Apple to sell around 10 million iPads in all of 2010.
We estimate that Macintosh PCs constitute 14% of the $337 Trefis price estimate for Apple's stock. We expect Mac notebooks to increase their market share from 5.04% in 2009 to 8.74% by the end of the Trefis forecast period. We expect Apple's desktop market share to increase from 2.69% in 2009 to 6.49% by 2016.
Based on Apple's PC market share gains in the second quarter of this year, when the iPad launch dominated media coverage of Apple, we see potential for Mac sales to increase even more rapidly than our current forecast. In the event that Apple's notebook share increases to 10% and its desktop share increases to 8% by 2016, there could be an upside of of 2% to our price estimate.
You can drag the trend-lines in the charts below to create your own forecasts for Apple's notebook and desktop market shares, respectively, and see how they impact the company's stock price.
Halo effect?
Although the iPad may well be boosting Mac sales in the short term by stimulating consumer interest in all things Apple, we can't say whether this happy trend has long-term legs. In the past, the iPod exerted a similar halo effect on Mac sales. On the other hand, the iPhone cannibalized a significant portion of iPod sales.
In another article, we discussed the possible impact of iPad cannibalization on Mac sales.
You can see the complete $337 Trefis Price estimate for Apple's stock here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Apple competes with other PC manufacturers like Dell ( DELL ) and HP ( HPQ ). We believe this could be due to the halo effect that the ballyhooed iPad launch created around all Apple products, including Macs. You can drag the trend-lines in the charts below to create your own forecasts for Apple's notebook and desktop market shares, respectively, and see how they impact the company's stock price.
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Apple competes with other PC manufacturers like Dell ( DELL ) and HP ( HPQ ). We estimate that Macintosh PCs constitute 14% of the $337 Trefis price estimate for Apple's stock. We expect Apple's desktop market share to increase from 2.69% in 2009 to 6.49% by 2016.
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Apple competes with other PC manufacturers like Dell ( DELL ) and HP ( HPQ ). Considering Apple's robust PC market performance, it does not appear that many consumers are choosing iPads over Apple Macintosh notebook or desktop PCs. Mac share forecast According to management , Apple sold 3.47 million Macs in the second quarter of 2010, which is 18% more than the 2.94 million Macs sold in the first quarter.
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Apple competes with other PC manufacturers like Dell ( DELL ) and HP ( HPQ ). We expect Mac notebooks to increase their market share from 5.04% in 2009 to 8.74% by the end of the Trefis forecast period. Based on Apple's PC market share gains in the second quarter of this year, when the iPad launch dominated media coverage of Apple, we see potential for Mac sales to increase even more rapidly than our current forecast.
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eb1139f3-177c-4e61-8c1a-81f3878be059
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727017.0
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2010-08-23 00:00:00 UTC
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Is the DELL, HP, PAR Merger Battle Really A Bullish Thing?
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DELL
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https://www.nasdaq.com/articles/dell-hp-par-merger-battle-really-bullish-thing-2010-08-23
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nan
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nan
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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872c4fe4-e7dd-46e1-a039-ce8f6e7150b7
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727018.0
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2010-08-23 00:00:00 UTC
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Opening View: DJIA Bulls Look to Bounce Back on Deal-Making Spree
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DELL
|
https://www.nasdaq.com/articles/opening-view-djia-bulls-look-bounce-back-deal-making-spree-2010-08-23
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nan
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nan
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The Dow Jones Industrial Average (DJIA) has pulled back roughly 4.7% since peaking near 10,720 in mid-August. While the DJIA closed out last week with a 60-point drop on Friday, the blue-chip barometer closed off its session lows, and comes into this week trading above potential support near 10,200. Meanwhile, the S&P 500 Index (SPX) held at the 1,070 level on Friday, though the broad-market index is once again staring up at potentially stiff resistance in the 1,100 region. Heading into the open, futures on the DJIA and SPX are trading about 38 points and 5.5 points above fair value, respectively, pointing toward a positive start to the session. Finally, the CBOE Market Volatility Index (VIX) remains somewhat in check, with the index closing above its 10-week trendline for a second week in a row, but unable to surmount its 20-week moving average in the 27 area. If the VIX were to move lower from this point, it could be bullish for the market. That said, we are entering a post-expiration week, which could be fraught with headwinds as investors work to re-establish hedges that expired last week.
Wheeling and dealing is dominating the equities landscape this Monday morning. First up, Potash Corp. of Saskatchewan ( POT ) once again urged shareholders to reject BHP Billiton Plc.'s ( BHP ) $40 billion unsolicited bid. Potash said that it's been contacted by and has reached out to a "number of third parties who have expressed an interest in considering alternative transactions."
Meanwhile, Hewlett-Packard Co. ( HPQ ) has outbid Dell Inc. ( DELL ) for 3PAR Inc. ( PAR ), offering $24 per share for PAR, a 33.3% premium to Dell's offer of $18 per share. H-P hopes the deal will close by the year's end.
Finally, HSBC Holdings plc ( HBC ) has entered into exclusive talks to acquire a majority stake in Nedbank Group Ltd. from U.K. insurer Old Mutual plc. HSBC stated that talks are in progress and that any deal would be subject to conditions including regulatory clearances. The Financial Times reported Sunday that HSBC was set to win the bidding for a 52% holding in Nedbank, South Africa's fourth-largest lender.
Earnings Preview
On the earnings front, Focus Media Holding Limited ( FMCN ) is scheduled to release its quarterly earnings report today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
There are no major economic reports scheduled for release today. Tomorrow offers up July's existing home sales data. On Wednesday, July's durable goods orders, new home sales, and the weekly report on U.S. petroleum supplies will hit the Street. Weekly initial jobless claims will arrive on Thursday, while Friday rounds out the week with a second look at second-quarter U.S. gross domestic product and the final reading on the University of Michigan's August consumer sentiment index.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,331,720 call contracts traded on Friday, compared to 967,871 put contracts. The resultant single-session put/call ratio arrived at 0.73, while the 21-day moving average rose to 0.64.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Live From San Francisco: Senior Equities Analyst Andrea Kramer live blogged from the Schaeffer's booth at the San Francisco Money Show this week. If you didn't' catch it, you missed out on Steve Forbes and his three-step approach for resuscitating the American economy, including his opinion on the U.S. dollar, the federal tax code, and "Obamacare." Click here to check it out.
Overseas Trading
Overseas trading is mixed, as six of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a gain of 0.19%. Asian markets closed broadly lower, with Japan once again leading the decline as concerns grew that authorities may not step in and prevent a continued rise in the yen. Elsewhere, mining stocks were standouts, as shares gained after Australia's weekend election failed to produce a clear winner. Deal making is helping to lift sentiment in the euro zone, sending European markets higher. Specifically, Old Mutual rose nearly 5% after HSBC Holdings said it's in talks to acquire a majority stake in Old Mutual's Nedbank Group.
Currencies and Commodities
With the euro struggling to move higher, the U.S. Dollar Index is once again flirting with resistance near its 10-week moving average. The greenback has pulled back a bit in early European trading, with the index down 0.11% at $82.97. Commodities have garnered some strength from this pullback in the dollar, with the front-month crude contract up 28 cents at $74.10 per barrel. Finally, gold is trading essentially flat, rising 50 cents to trade at $1,229.30 an ounce in London.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Meanwhile, Hewlett-Packard Co. ( HPQ ) has outbid Dell Inc. ( DELL ) for 3PAR Inc. ( PAR ), offering $24 per share for PAR, a 33.3% premium to Dell's offer of $18 per share. If you didn't' catch it, you missed out on Steve Forbes and his three-step approach for resuscitating the American economy, including his opinion on the U.S. dollar, the federal tax code, and "Obamacare." Asian markets closed broadly lower, with Japan once again leading the decline as concerns grew that authorities may not step in and prevent a continued rise in the yen.
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Meanwhile, Hewlett-Packard Co. ( HPQ ) has outbid Dell Inc. ( DELL ) for 3PAR Inc. ( PAR ), offering $24 per share for PAR, a 33.3% premium to Dell's offer of $18 per share. Finally, HSBC Holdings plc ( HBC ) has entered into exclusive talks to acquire a majority stake in Nedbank Group Ltd. from U.K. insurer Old Mutual plc. Market Statistics Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,331,720 call contracts traded on Friday, compared to 967,871 put contracts.
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Meanwhile, Hewlett-Packard Co. ( HPQ ) has outbid Dell Inc. ( DELL ) for 3PAR Inc. ( PAR ), offering $24 per share for PAR, a 33.3% premium to Dell's offer of $18 per share. While the DJIA closed out last week with a 60-point drop on Friday, the blue-chip barometer closed off its session lows, and comes into this week trading above potential support near 10,200. Finally, the CBOE Market Volatility Index (VIX) remains somewhat in check, with the index closing above its 10-week trendline for a second week in a row, but unable to surmount its 20-week moving average in the 27 area.
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Meanwhile, Hewlett-Packard Co. ( HPQ ) has outbid Dell Inc. ( DELL ) for 3PAR Inc. ( PAR ), offering $24 per share for PAR, a 33.3% premium to Dell's offer of $18 per share. While the DJIA closed out last week with a 60-point drop on Friday, the blue-chip barometer closed off its session lows, and comes into this week trading above potential support near 10,200. Finally, the CBOE Market Volatility Index (VIX) remains somewhat in check, with the index closing above its 10-week trendline for a second week in a row, but unable to surmount its 20-week moving average in the 27 area.
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9dcd38f4-f1bb-4d83-af03-538cb9a67a31
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727019.0
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2010-08-23 00:00:00 UTC
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This Company's 10-Day, +169% Run is Heating up an Entire Sector
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DELL
|
https://www.nasdaq.com/articles/companys-10-day-169-run-heating-entire-sector-2010-08-23
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nan
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nan
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Investors in 3PAR ( PAR ) can't believe their good fortune. They woke up last Monday to find that their investment had nearly doubled in value after Dell (Nasdaq: DELL) announced plans to buy the data storage company. And this Monday morning, they got another gift when Hewlett-Packard ( HPQ ) announced plans to outbid Dell, sending shares of 3PAR up another +44%. That's a +169% gain since August 13th.
Wouldn't that be nice if all of our investments worked out so well...
That hand has been played, but investors certainly think other quick profits can be made in the sector, and are bidding up shares of Compellent Technologies ( CML ), Isilion Systems (Nasdaq: ISLN) and CommVault (Nasdaq: CVLT) in recent sessions. All three stocks are up +25% to +30% since last Monday morning. Investors are either foolhardy in chasing these names or on the cusp of picking the field's next winner. Let's take a look.
A storage pioneer
3PAR's technology appeal is fairly obvious to industry analysts. The company has pioneered a new type of data management software known as "utility storage." Until now, companies that need to manage large amounts of data could invest in either monolithic or modular storage. Monolithic systems (sold by firms such as EMC ( EMC ) ) are very expensive, take a long time to deploy, yet are very robust. Modular systems are much less expensive and can be used to add incremental amounts of storage management as networks grow, but are considered to be less robust. (The technology discussion is actually much more complex than this simplification, but you get the basic idea.)
3PAR's approach actually marries the two by adding a range of software tools that help to better orchestrate all of the requirements that go into running a large mission-critical data network. This "utility storage" approach uses less power and lowers the level of needed IT expenses. Dell and HP both realize that lowering IT management costs while expanding capacity is the number one goal of their customers.
The rest of the pack
Along with 3PAR, Compellent Technologies had received a considerable amount of industry buzz in recent months. The company's forte is "automated data-tiering," which means that the most frequently used data in corporate networks is held in readily-accessible memory banks, not in less accessible disk drives. EMC has a similar offering, but some analysts think that Compellent's technology is better. To acquire Compellent, any tech firm would likely need to have either no relationship with EMC or would need to exit that relationship. That rules out Dell, unless the company takes the money it hoped to use for a 3PAR deal and use it on Compellent and another firm, thus eliminating the need to rely on EMC.
Who's that other firm? Perhaps CommVault Systems. CommVault already counts on Dell for roughly 25% of its sales, and the two firms jointly call on many of the same customers. CommVault sells a wide range of network and data management software on one lone technology platform. Rivals such as EMC have made a series of acquisitions and have never completely merged the disparate technologies, making for IT headaches. CommVault's key selling point is that its software operates seamlessly and in a very low-cost fashion.
Don't forget Isilon
Isilon Systems has quickly emerged as a viable alternative in an area known as network-attached storage (NAS). The NAS market was pioneered by NetApp (Nasdaq: NTAP) , which has a market value and revenue base 10 times greater than Isilon's. Yet some industry watchers think Isilon's technology base is even more robust than its larger rival.
Isilon was a hot IPO at the end of 2006, but shares eventually lost -90% of their value thanks to a string of bad quarters. New management arrived in 2008, and the company has regained much of its lost mojo. Shares have risen more than +300% in the past 10 months and now trade for more than 50 times next year's earnings . Shares are so pricey simply because investors believe Isilon would help a larger tech player make a big splash in this market. So they're not paying for potential profits, but for the technology base -- and frankly, it's impossible to know what shares are really worth to a potential buyer -- until that buyer emerges.
Action to Take --> Shares of Compellent are also quite pricey, and along with Islion's shares, are hard to value. You may want to sit and wait for these stocks to return to earth. As time passes and no other deals emerge, shares of Isilon and Compellent are bound to pull back, especially if the Nasdaq enters another choppy phase.
In contrast, CommVault is the one you should keep your eye on for a buyout . The company may lack the technology buzz of those two smaller technology players, but it has a sizable customer base that could open plenty of new cross-selling opportunities for any large tech firms. As Dell regroups after the 3PAR bidding war, CommVault may soon move into its sights.
-- David Sterman
David Sterman started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and a Managing Editor at TheStreet.com. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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That rules out Dell, unless the company takes the money it hoped to use for a 3PAR deal and use it on Compellent and another firm, thus eliminating the need to rely on EMC. They woke up last Monday to find that their investment had nearly doubled in value after Dell (Nasdaq: DELL) announced plans to buy the data storage company. And this Monday morning, they got another gift when Hewlett-Packard ( HPQ ) announced plans to outbid Dell, sending shares of 3PAR up another +44%.
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They woke up last Monday to find that their investment had nearly doubled in value after Dell (Nasdaq: DELL) announced plans to buy the data storage company. And this Monday morning, they got another gift when Hewlett-Packard ( HPQ ) announced plans to outbid Dell, sending shares of 3PAR up another +44%. Dell and HP both realize that lowering IT management costs while expanding capacity is the number one goal of their customers.
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They woke up last Monday to find that their investment had nearly doubled in value after Dell (Nasdaq: DELL) announced plans to buy the data storage company. And this Monday morning, they got another gift when Hewlett-Packard ( HPQ ) announced plans to outbid Dell, sending shares of 3PAR up another +44%. Dell and HP both realize that lowering IT management costs while expanding capacity is the number one goal of their customers.
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They woke up last Monday to find that their investment had nearly doubled in value after Dell (Nasdaq: DELL) announced plans to buy the data storage company. And this Monday morning, they got another gift when Hewlett-Packard ( HPQ ) announced plans to outbid Dell, sending shares of 3PAR up another +44%. Dell and HP both realize that lowering IT management costs while expanding capacity is the number one goal of their customers.
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a28a4061-5eae-4c84-803a-d5f9bcdf4ca4
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727020.0
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2010-08-20 00:00:00 UTC
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Opening View: DJIA Bears Take Reins Heading Into Weekend
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DELL
|
https://www.nasdaq.com/articles/opening-view-djia-bears-take-reins-heading-weekend-2010-08-20
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nan
|
nan
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The Dow Jones Industrial Average (DJIA) dropped 144 points on Thursday, ending the bulls' attempt to regain control and take the market higher. The DJIA is headed into the weekend perched on support at its 10-week moving average, with additional support near 10,250. This region is home to a 38.2% Fibonacci retracement of the Dow's April 26 high and its July 2 low. Meanwhile, the S&P 500 Index (SPX) is hovering just above technical support in the 1,070 region. Heading into the open, futures on the DJIA and the SPX are trading about 58 points and 6.9 points below fair value, respectively, indicating that we could see the market test the aforementioned support levels in early trading. Finally, there are signs that bearish sentiment is reaching elevated levels, with the most recent American Association of Individual Investors survey revealing that 42.47% of those polled are bearish on the market, versus 30.11% bullish. These are the highest bearish and lowest bullish readings since July 8.
In equity news, J.M. Smucker Co. ( SJM ) reported first-quarter earnings of $102.9 million, or 86 cents per share, as revenue slipped to $1.04 billion. Analysts were looking for a profit of 96 cents per share. The company also lifted its 2011 sales growth outlook to "slightly ahead" of its original estimate for 3% growth due to recent pricing moves. It expects to earn $4.50 to $4.60 per share for the full year.
Elsewhere, Hewlett-Packard Co. ( HPQ ) reported a fiscal third-quarter profit of $1.8 billion, or 75 cents per share, compared with a profit of $1.7 billion, or 69 cents per share, for the year-earlier period. Revenue was $30.7 billion, up from $27.6 billion. Adjusted income was $1.08 per share.
Finally, Dell Inc. ( DELL ) reported a second-quarter profit of $545 million, or 28 cents per share, on $15.5 billion in sales, compared with earnings of $472 million, or 24 cents per share on revenue of $12.8 billion in the same period a year ago. Excluding one-time items, Dell would have earned $629 million, or 32 cents per share. The consensus estimate was for 30 cents per share on revenue of $15.2 billion.
Live From San Francisco : Senior Equities Analyst Andrea Kramer is live blogging from the Schaeffer's booth at the San Francisco Money Show this week. If you didn't catch last night's post, you missed out on Steve Forbes and his three-step approach for resuscitating the American economy, including his opinion on the U.S. dollar, the federal tax code, and "Obamacare." Click here to check it out.
Earnings Preview
On the earnings front, AnnTaylor Stores Corp. ( ANN ) and Hormel Foods Corp. ( HRL ) are scheduled to release their quarterly earnings report today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
There are no major economic reports scheduled for release today. Looking ahead to next week, Monday is also devoid of reports, while Tuesday offers up July's existing home sales data. On Wednesday, July's durable goods orders, new home sales, and the weekly report on U.S. petroleum supplies will hit the Street. Weekly initial jobless claims will arrive on Thursday, while Friday rounds out the week with a second look at second-quarter U.S. gross domestic product and the final reading on the University of Michigan's August consumer sentiment index.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,179,244 call contracts traded on Thursday, compared to 884,513 put contracts. The resultant single-session put/call ratio arrived at 0.75, while the 21-day moving average rose to 0.63.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Overseas Trading
Overseas trading looks abysmal this morning, as none of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a loss of 1.10%. In Asian trading, Japanese shares erased their gains for the week, plunging roughly 2% as the dollar remains weak against the yen, keeping the cost of exports for the country high. Meanwhile, Chinese markets dropped after Beijing announced new property-tightening measures, with the Ministry of Land and Resources saying it will crack down on land hoarding and misuse by property developers. Markets are broadly lower in Europe as well, with economic concerns and falling crude prices applying pressure to commodities-related stocks.
Currencies and Commodities
Safe-haven buying is the name of the game this week in currencies and commodities, with the U.S. dollar heading for its second winning week in a row. However, the U.S. Dollar Index is still facing resistance at its 10-week moving average, near 83.23. In pre-market trading the index is up 0.75% at $83.06. Commodities, meanwhile, are struggling under the weight of a rising greenback. Most notably, oil prices are taking a beating due, not only to the rising dollar, but also because of the recent round of weak economic data. In electronic trading, the front-month crude contract is down $1.06 at $73.71 per barrel - a six-week low. Finally, gold prices are pulling back from a yesterday's seven-week high near $1,240. In London, the malleable metal has slipped $2.90 to $1,232.50 an ounce.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Finally, Dell Inc. ( DELL ) reported a second-quarter profit of $545 million, or 28 cents per share, on $15.5 billion in sales, compared with earnings of $472 million, or 24 cents per share on revenue of $12.8 billion in the same period a year ago. Excluding one-time items, Dell would have earned $629 million, or 32 cents per share. The Dow Jones Industrial Average (DJIA) dropped 144 points on Thursday, ending the bulls' attempt to regain control and take the market higher.
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Finally, Dell Inc. ( DELL ) reported a second-quarter profit of $545 million, or 28 cents per share, on $15.5 billion in sales, compared with earnings of $472 million, or 24 cents per share on revenue of $12.8 billion in the same period a year ago. Excluding one-time items, Dell would have earned $629 million, or 32 cents per share. Elsewhere, Hewlett-Packard Co. ( HPQ ) reported a fiscal third-quarter profit of $1.8 billion, or 75 cents per share, compared with a profit of $1.7 billion, or 69 cents per share, for the year-earlier period.
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Finally, Dell Inc. ( DELL ) reported a second-quarter profit of $545 million, or 28 cents per share, on $15.5 billion in sales, compared with earnings of $472 million, or 24 cents per share on revenue of $12.8 billion in the same period a year ago. Excluding one-time items, Dell would have earned $629 million, or 32 cents per share. Heading into the open, futures on the DJIA and the SPX are trading about 58 points and 6.9 points below fair value, respectively, indicating that we could see the market test the aforementioned support levels in early trading.
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Finally, Dell Inc. ( DELL ) reported a second-quarter profit of $545 million, or 28 cents per share, on $15.5 billion in sales, compared with earnings of $472 million, or 24 cents per share on revenue of $12.8 billion in the same period a year ago. Excluding one-time items, Dell would have earned $629 million, or 32 cents per share. Smucker Co. ( SJM ) reported first-quarter earnings of $102.9 million, or 86 cents per share, as revenue slipped to $1.04 billion.
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27c5123e-99b2-4b37-83ab-96cb7e8c43cd
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727021.0
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2010-08-20 00:00:00 UTC
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Don't be Fooled by These High Yield Stocks
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DELL
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https://www.nasdaq.com/articles/dont-be-fooled-these-high-yield-stocks-2010-08-20
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nan
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nan
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Investors tend to steer clear of any company or industry with limited growth prospects. But there is money to be made if the rest of the market looks to shun such investments. After all, these largely matured businesses don't need to invest much money to develop products and fuel new growth, so they can generate an outsized level of profits on their revenue streams.
That's why some investors love tobacco stocks. They're unloved by many, but they typically offer very juicy dividends, making them a favorite among income-oriented investors.
Friday morning, we were reminded just how profitable these companies are: Lorillard ( LO ) , which makes Newport cigarettes, announced that an already juicy dividend would be boosted +12.5%, and the company plans to buy back another $1 billion in stock. Let's take a deeper look to see if the sector should merit your investment dollars.
Final spurt of growth
Many of us (myself included) assumed that Big Tobacco is already in decline. Yet as the table below notes, the biggest industry players are still seeing a bit more revenue growth this year, thanks in part to rising demand for smokeless tobacco.
But 2011 may mark the long-awaited inflection point that finally sees industry sales turn down as municipal smoking restrictions become increasingly onerous, which means that current sales and cash flow trends may be as good as it gets for this industry. And that puts the relevant valuation metrics into a stark spotlight.
It's nice to see that Lorillard plans to buy back $1 billion in stock. Trouble is, that looks like an overreach. The company generated just $355 million in free cash flow in 2009, so it would take nearly three years worth of free cash flow to cover that buyback without hurting the balance sheet . Moreover, Lorillard paid out $631 million in the form of dividends last year, which appears unsustainable in light of that free cash flow. The fact that management has actually boosted the dividend means they are willing to deplete cash to cover that payout.
For Lorillard, that's challenging enough, with just $6 million in net cash on the balance sheet (though it has $1.8 billion in gross cash). But for rivals Reynolds American ( RAI ) , Altria ( MO ) and Philip Morris International ( PM ) , which have $2 billion, $11 billion and nearly $13 billion in net debt, respectively, any move to hike the dividend or buy back more stock would be foolhardy.
This brings us back to the question of whether investors should buy these stocks. They all are valued at around 10 to 11 times projected profits, which isn't exceptionally cheap when there are many companies trading with single-digit P/E ratios right now. And Big Tobacco's dividend yields, which stand at around 6%, are not as attractive as some fixed-income equities such as master limited partnerships (MLPs) , the virtues of which my colleague Carla Pasternak and others have extolled. [Read: One of the Best Dividend Payers Ever Just Got Better ].
Action to Take --> It's best to avoid this seemingly tempting investment opportunity. Juicy dividends are nice, and large stock buybacks are a plus, but there are too many negatives in this industry -- most notably eventually declining sales and profits, and too-high debt loads. Of these stocks, at least Philip Morris still has decent growth prospects thanks to its international exposure.
If you want low P/E stocks, you can find them among tech stocks like Dell (Nasdaq: DELL) and Seagate ( STX ) . [Read: 3 Beaten-down Tech Stocks Set for a Rebound ] If you want nice dividend yields, you can find them among the oil and gas distribution MLPs such as Enbridge Energy ( EEP ) , which currently yields 7.4%.
-- David Sterman
David Sterman started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and a Managing Editor at TheStreet.com. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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If you want low P/E stocks, you can find them among tech stocks like Dell (Nasdaq: DELL) and Seagate ( STX ) . After all, these largely matured businesses don't need to invest much money to develop products and fuel new growth, so they can generate an outsized level of profits on their revenue streams. And Big Tobacco's dividend yields, which stand at around 6%, are not as attractive as some fixed-income equities such as master limited partnerships (MLPs) , the virtues of which my colleague Carla Pasternak and others have extolled.
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If you want low P/E stocks, you can find them among tech stocks like Dell (Nasdaq: DELL) and Seagate ( STX ) . Friday morning, we were reminded just how profitable these companies are: Lorillard ( LO ) , which makes Newport cigarettes, announced that an already juicy dividend would be boosted +12.5%, and the company plans to buy back another $1 billion in stock. But for rivals Reynolds American ( RAI ) , Altria ( MO ) and Philip Morris International ( PM ) , which have $2 billion, $11 billion and nearly $13 billion in net debt, respectively, any move to hike the dividend or buy back more stock would be foolhardy.
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If you want low P/E stocks, you can find them among tech stocks like Dell (Nasdaq: DELL) and Seagate ( STX ) . Friday morning, we were reminded just how profitable these companies are: Lorillard ( LO ) , which makes Newport cigarettes, announced that an already juicy dividend would be boosted +12.5%, and the company plans to buy back another $1 billion in stock. But for rivals Reynolds American ( RAI ) , Altria ( MO ) and Philip Morris International ( PM ) , which have $2 billion, $11 billion and nearly $13 billion in net debt, respectively, any move to hike the dividend or buy back more stock would be foolhardy.
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If you want low P/E stocks, you can find them among tech stocks like Dell (Nasdaq: DELL) and Seagate ( STX ) . That's why some investors love tobacco stocks. Friday morning, we were reminded just how profitable these companies are: Lorillard ( LO ) , which makes Newport cigarettes, announced that an already juicy dividend would be boosted +12.5%, and the company plans to buy back another $1 billion in stock.
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39b00237-8c33-460b-8670-cec619f21e77
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727022.0
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2010-08-19 00:00:00 UTC
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Why Today's Intel Deal Makes Tech Even More Appealing
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DELL
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https://www.nasdaq.com/articles/why-todays-intel-deal-makes-tech-even-more-appealing-2010-08-19
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nan
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nan
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Throughout the summer, a clear theme has emerged. High-tech companies have reported generally solid results, and yet shares in the sector keep drifting down toward 52-week lows. Despite their considerable cash balances, investors have grown increasingly concerned that sector growth will stall out. That's why Intel's (Nasdaq: INTC) just-announced decision to buy security software vendor McAfee ( MFE ) is so important. It's a clear sign that these tech titans will use their balance sheets to help alleviate those growth concerns.
Short -term implications
The fact that Intel is paying a +60% premium to Wednesday's close tells you that private market valuations are often far higher than the value these companies are getting as public entities. It's also noteworthy that Intel's offer of $48 a share is just above McAfee's 52-week trading range. Generally speaking, buyout offers must exceed that threshold to avoid accusations that a company is being sold on the cheap while it is out of favor.
Then again, McAfee's shares haven't seen $48 since the dot-com era of 1999. McAfee's board would have been hard-pressed to reject this offer, though the lofty purchase price likely means that other suitors are unlikely to emerge.
The move is a curious one for Intel as it represents a shift away from hardware and into software. And Intel is probably not done: McAfee is probably seen as one of several pieces that can be brought together to provide a broad software platform. If Intel makes another move, it could be in the areas of data storage software or "cloud computing," which involves the use of many networked computers to boost storage and increase processing power. Names to watch include VMWare ( VMW ) , NetApp (Nasdaq: NTAP) and Citrix Software (Nasdaq: CTRX) .
Notably, shares of McAfee rival Symantec (Nasdaq: SYMC) are up more than +10% on this news. Symantec focuses on both network security and data storage. The company's stock has been out of favor for more than five years, as I noted recently. [Read: 3 Beaten-down Tech Stocks Set for a Rebound ]
If Symantec is indeed "in play," then firms like Hewlett-Packard ( HPQ ) and Dell (Nasdaq: DELL) may be interested. Ironically, both of those firms are expected to weigh in with earnings after the market closes today, and you can expect this topic to come up in the companies' conference calls.
Long-term implications
As noted above, Intel's deal could spark fresh interest in tech stocks. In many respects, the industry is ripe for an M&A boom, which is always good for valuations. Companies tend to make acquisitions when organic growth is weak and shares are languishing. Many executive compensation packages are tied to rising stock prices, and historically speaking, buying new revenue streams and then paring costs have been a sure-fire way to boost the bottom-line -- and the stock price.
Action to Take --> Purchasing a stock simply because it is a buyout candidate is always a bad idea. Most rumored deals never actually take place, and those rumors are offered by traders simply looking to pump up a stock before dumping it.
Instead, you should buy a stock primarily based on attractive valuations or organic growth prospects. A potential acquisition is simply another reason to find shares appealing. That said, small to mid-sized tech companies that could offer new market opportunities for bigger tech players include Netscout Systems (Nasdaq: NTCT) , Integrated Silicon Solutions (Nasdaq: ISSI) , Websense (Nasdaq: WBSN) and Blue Coat Systems (Nasdaq: BCSI) .
-- David Sterman
David Sterman started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and a Managing Editor at TheStreet.com. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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[Read: 3 Beaten-down Tech Stocks Set for a Rebound ] If Symantec is indeed "in play," then firms like Hewlett-Packard ( HPQ ) and Dell (Nasdaq: DELL) may be interested. That's why Intel's (Nasdaq: INTC) just-announced decision to buy security software vendor McAfee ( MFE ) is so important. Short -term implications The fact that Intel is paying a +60% premium to Wednesday's close tells you that private market valuations are often far higher than the value these companies are getting as public entities.
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[Read: 3 Beaten-down Tech Stocks Set for a Rebound ] If Symantec is indeed "in play," then firms like Hewlett-Packard ( HPQ ) and Dell (Nasdaq: DELL) may be interested. Despite their considerable cash balances, investors have grown increasingly concerned that sector growth will stall out. Generally speaking, buyout offers must exceed that threshold to avoid accusations that a company is being sold on the cheap while it is out of favor.
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[Read: 3 Beaten-down Tech Stocks Set for a Rebound ] If Symantec is indeed "in play," then firms like Hewlett-Packard ( HPQ ) and Dell (Nasdaq: DELL) may be interested. That's why Intel's (Nasdaq: INTC) just-announced decision to buy security software vendor McAfee ( MFE ) is so important. That said, small to mid-sized tech companies that could offer new market opportunities for bigger tech players include Netscout Systems (Nasdaq: NTCT) , Integrated Silicon Solutions (Nasdaq: ISSI) , Websense (Nasdaq: WBSN) and Blue Coat Systems (Nasdaq: BCSI) .
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[Read: 3 Beaten-down Tech Stocks Set for a Rebound ] If Symantec is indeed "in play," then firms like Hewlett-Packard ( HPQ ) and Dell (Nasdaq: DELL) may be interested. It's also noteworthy that Intel's offer of $48 a share is just above McAfee's 52-week trading range. And Intel is probably not done: McAfee is probably seen as one of several pieces that can be brought together to provide a broad software platform.
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03004a3c-6f06-4ef8-bb7d-cee56ed723b6
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727023.0
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2010-08-18 00:00:00 UTC
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10 Stocks That Should Pay a Dividend, but Don’t (GOOG, AAPL, BRK.A, AMZN, more)
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DELL
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https://www.nasdaq.com/articles/10-stocks-should-pay-dividend-dont-goog-aapl-brka-amzn-more-2010-08-18
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nan
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nan
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A whopping 372 stocks on the S&P 500 index pay dividends, but that still leaves 128 that don't. Here are our Top 10 stocks that should be paying a dividend to their shareholders.
The benefits to paying dividends are numerous. High dividend payouts attract a solid base of long-term investors in a company, which helps put a cap on share volatility. Both retail investors and fund managers love dividends for their income and compounding returns, so without further ado, here are 10 big-name stocks that should start paying a dividend.
1. Google Inc. ( GOOG )
This tech behemoth is sitting on an estimated $30 billion in cash. That's about $94 per share - absolutely none of which will be paid out to shareholders this year. Reward your investors and share the wealth, Google!
2. Apple Inc. ( AAPL )
Apple is another tech darling sitting on a boatload of cash - around $24 billion, to be exact. With its stellar product pipeline and long history of innovation in the tech space, this company could well afford to initiate a dividend payout.
3. Amazon.com, Inc. ( AMZN )
Amazon doesn't have as large a cash position (around $5.1 billion) as Google or Apple, but it would still do well to initiate a dividend. This stock was a high-flier for many years before it ever even turned a profit, but the future has always looked bright for the online retail juggernaut.
4. eBay Inc. ( EBAY )
For a stock that's been essentially "dead money" for years (now trading at 2002 levels ), eBay has done remarkably little to inspire investors to invest in its future. A healthy dividend payout would go a long way to attracting long-term shareholders, and could help this company rise from the doldrums its been stuck in for several years.
5. Yahoo! Inc ( YHOO )
Essentially the only catalyst for growth in this tech giant for the past several years has been persistent rumors of a takeover by Microsoft ( MSFT ) . Reportedly, Microsoft had a $30 per-share offer on the table for Yahoo back in February 2008, which the company inexplicably declined in one of the all-time management bungles in business history. Yahoo shares now trade under the $14 level, and catalysts for share price growth are looking slim.
6. Dell Inc. ( DELL )
Dell is another "dead money" tech stock that has thus far refused to join the ranks of the dividend payers. The world's largest PC maker is hoarding around $11 billion in cash in its coffers - more than enough to fund a substantial dividend payout.
7. Kohl's Corporation ( KSS )
You didn't think our list will be only comprised of tech stocks, did you? As a department store operator, Kohl's is a prime candidate for initiating a dividend payout. Its main rival, Target ( TGT ) , sports a decent 2% annual dividend yield, so why doesn't Kohl's step up to the plate, too?
8. Berkshire Hathaway ( BRK-A )
Berkshire's world famous billionaire owner Warren Buffett is notorious for his preference of good dividend-paying stocks over non-dividend-payers. Why, then, doesn't he initiate a dividend payout for his own company? With an unbelievably-high estimate of $16,000 per share in cash sitting on the books (no, that's not a typo), there's simply no excuse for Mr. Buffett to not reward his loyal shareholders with regular dividends.
9. Amgen, Inc. ( AMGN )
Amgen, which develops drug treatments for several serious illnesses, has a whopping estimated $15 billion in cash, but unlike its rivals Johnson & Johnson ( JNJ ) , Merck ( MRK ) , and Eli Lilly ( LLY ) , it still refuses to pay a dividend. While it's true that many biotech names don't pay dividends, Amgen is one of the most mature names in the space.
10. WellPoint Inc. ( WLP )
Last but certainly not least, we've got health benefits giant WellPoint. With more than $18 billion in cash, this company could well-afford a substantial dividend payout. Similar to the biotech sector, health benefits providers have been slow to join the dividend party, but the time is right to start payout out now.
Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Created by Dividend.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell Inc. ( DELL ) Dell is another "dead money" tech stock that has thus far refused to join the ranks of the dividend payers. High dividend payouts attract a solid base of long-term investors in a company, which helps put a cap on share volatility. Reportedly, Microsoft had a $30 per-share offer on the table for Yahoo back in February 2008, which the company inexplicably declined in one of the all-time management bungles in business history.
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Dell Inc. ( DELL ) Dell is another "dead money" tech stock that has thus far refused to join the ranks of the dividend payers. 4. eBay Inc. ( EBAY ) For a stock that's been essentially "dead money" for years (now trading at 2002 levels ), eBay has done remarkably little to inspire investors to invest in its future. While it's true that many biotech names don't pay dividends, Amgen is one of the most mature names in the space.
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Dell Inc. ( DELL ) Dell is another "dead money" tech stock that has thus far refused to join the ranks of the dividend payers. Both retail investors and fund managers love dividends for their income and compounding returns, so without further ado, here are 10 big-name stocks that should start paying a dividend. Amgen, Inc. ( AMGN ) Amgen, which develops drug treatments for several serious illnesses, has a whopping estimated $15 billion in cash, but unlike its rivals Johnson & Johnson ( JNJ ) , Merck ( MRK ) , and Eli Lilly ( LLY ) , it still refuses to pay a dividend.
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Dell Inc. ( DELL ) Dell is another "dead money" tech stock that has thus far refused to join the ranks of the dividend payers. Google Inc. ( GOOG ) This tech behemoth is sitting on an estimated $30 billion in cash. Why, then, doesn't he initiate a dividend payout for his own company?
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799cf3f4-48f1-4b72-8c04-6286afa43201
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727024.0
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2010-08-17 00:00:00 UTC
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Don’t be Fooled by a Reaction Rally
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DELL
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https://www.nasdaq.com/articles/dont-be-fooled-reaction-rally-2010-08-17
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nan
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nan
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Yesterday, stocks were mixed with the indices flat at the closing bell. And the volume was the lightest of the year on both the NYSE and Nasdaq.
To non-participants, that hot August day appeared to have been just another very boring session following a sell-off, but to those participating, it was a highly charged battle with big swings in the indices.
The Dow Industrials plunged 100 points on the opening, then rallied. By 10:30 a.m., almost all of the early losses had been erased. But in the early afternoon, broad-based selling drove stocks down again, but this time the selling abated at half the morning's losses. At 3:15 p.m., the Dow was off about 60 points and drifting south, but late buying turned the market again, and by the close almost all of the losses had been regained for the second time in the session.
There were few reasons for the volatility other than low volume, which tends to exaggerate volatility as stocks are flipped by quick-footed traders. A lower-than-expected annualized Q2 GDP from Japan, renewed selling in Europe, and a smaller-than-expected rise in the August Empire Manufacturing Index, along with the downside momentum of last week, contributed to the lower opening.
The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. During the last four weeks, the technology sector has experienced a decline of 2.2%, so it was subject to some bargain hunting.
The Federal Reserve said that its bank loan survey showed that business and consumer loan demand was flat. That announcement contributed to the mid-afternoon sell-off.
For-profit education stocks fell following reports of poor loan repayment rates at Strayer Education, Inc. (NASDAQ: STRA ). And analysts at Deutsche Bank AG (NYSE: DB ) downgraded Corinthian Colleges, Inc. (NASDAQ: COCO ), which fell 21.62% and added to the woes of that group.
The U.S. dollar ended the day lower against both the euro and the yen with the euro at $1.2817.
At the final bell, the Dow Jones Industrial Average was off a fraction at 10,302, the S&P 500 rose slightly to 1,079, and the Nasdaq gained 8 points, closing at 2,182.
Volume on the NYSE totaled 788 million shares, the lowest of the year, and advancers were ahead of decliners by 1.64-to-1. The Nasdaq traded 477 million shares with advancers ahead by the same margin as the NYSE.
September crude oil fell 15 cents to $75.24 a barrel, and the Energy Select Sector SPDR (NYSE: XLE ) fell a penny to $53.34.
December gold rose 10 cents to settle at $1,226.20 an ounce. The PHLX Gold/Silver Sector Index (NASDAQ: XAU ) rose 2.59 points to 174.99.
What the Markets Are Saying
Yesterday's volatile, low-volume session may have had its exciting moments, but in the end it accomplished little for the bulls.
The first minutes of trading erupted into another gap down, but as noted, prices reversed, and the morning's gap was quickly covered and the losses overcome. At the end of the day, sellers were still in charge, but buyers were able to garner enough strength to avoid a breakdown, but unable to cover any of last week's downside gaps.
The Dow and the S&P 500 are range bound by their respective 50-day moving averages on the top and the July 20 lows at the bottom. And with volume at the lowest level of the year, it is likely that trading will be contained within that zone for some time.
But the Nasdaq's chart, with two enormous downside gaps, is quite different. Yesterday, the technology sector dragged the Nasdaq to an 8-point advance. But the outlook for the junior index is so bad that it will take more than a modest session of bargain hunting to overcome the damage. And a close under 2,150 could launch an all-out round of panic selling.
With most of the internal indicators now modestly oversold, the market is due for a reaction rally, but that's all. The pressure now exerted by the bears is heavy, so the bulls must hold the current support through mid-September or be drowned in a sea of sellers.
Today's Trading Landscape
Earnings to be reported before the opening include: Abercrombie & Fitch, Blue Phoenix, Elbit Systems, G&K Services, Home Depot, Saks, TJX Companies, VanceInfo Technologies and Wal-Mart.
Earnings to be reported after the close include: Analog Devices, Bob Evans, China Digital TV, Jack Henry, La-Z-Boy and Longtop Financial Technologies.
Economic reports due: e-commerce retail sales, ICSC-Goldman Sachs store sales, housing starts (the consensus expects 565,000), producer price index (the consensus expects 0.2%, and 0.1% ex-food and energy), Redbook, and industrial production (the consensus expects 0.6%, and 74.5% capacity utilization rate).
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
GameChanger Stocks to Build Your Wealth -GameChangers are companies that rewrite the rules, revolutionizing the way we live and thrive. Companies like Apple and Dendreon. Their business breakthroughs delivered handsome profits for savvy investors who got in early. Discover the next generation of GameChangers you should be buying now. Download your FREE copy of Hilary Kramer's new report here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. A lower-than-expected annualized Q2 GDP from Japan, renewed selling in Europe, and a smaller-than-expected rise in the August Empire Manufacturing Index, along with the downside momentum of last week, contributed to the lower opening. Today's Trading Landscape Earnings to be reported before the opening include: Abercrombie & Fitch, Blue Phoenix, Elbit Systems, G&K Services, Home Depot, Saks, TJX Companies, VanceInfo Technologies and Wal-Mart.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. For-profit education stocks fell following reports of poor loan repayment rates at Strayer Education, Inc. (NASDAQ: STRA ). The Nasdaq traded 477 million shares with advancers ahead by the same margin as the NYSE.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. At the final bell, the Dow Jones Industrial Average was off a fraction at 10,302, the S&P 500 rose slightly to 1,079, and the Nasdaq gained 8 points, closing at 2,182. Economic reports due: e-commerce retail sales, ICSC-Goldman Sachs store sales, housing starts (the consensus expects 565,000), producer price index (the consensus expects 0.2%, and 0.1% ex-food and energy), Redbook, and industrial production (the consensus expects 0.6%, and 74.5% capacity utilization rate).
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. At 3:15 p.m., the Dow was off about 60 points and drifting south, but late buying turned the market again, and by the close almost all of the losses had been regained for the second time in the session. At the end of the day, sellers were still in charge, but buyers were able to garner enough strength to avoid a breakdown, but unable to cover any of last week's downside gaps.
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981921c9-7a31-40cb-94fc-012593be7413
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727025.0
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2010-08-17 00:00:00 UTC
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H-P announces security-software developer acquisition
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DELL
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https://www.nasdaq.com/articles/h-p-announces-security-software-developer-acquisition-2010-08-17
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nan
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nan
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Hewlett-Packard will buy security-software maker Fortify Software for an undisclosed sum, the computing giant announced Tuesday.
The purchase comes on the heels of H-P rival Dell's ( DELL ) acquisition of 3Par, a storage- and virtualization-services company. Both deals were made in a bid to prop up H-P and Dell's presence in the lucrative enterprise-computing market. At present, Dell only derives a tiny fraction of its revenue from storage services; H-P, meanwhile, says Fortify will help it offer a holistic solution to companies' app needs.
"Joining H-P will allow us to further integrate our proven technology and security expertise with H-P's solutions, letting our joint clients shrink the time-to-security for their new and existing production applications," Fortify CEO John M. Jack said.
H-P's move is a clear sign that it expects the enterprise technology market to expand. Business spending on software and equipment surged 17 percent in the second quarter, the government said in late July - the largest quarterly increase since the first three months of 2006. If that pace of growth continues, H-P and Dell would do well to capitalize on the enterprise software and services market.
By Steve Monfort
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Both deals were made in a bid to prop up H-P and Dell's presence in the lucrative enterprise-computing market. At present, Dell only derives a tiny fraction of its revenue from storage services; H-P, meanwhile, says Fortify will help it offer a holistic solution to companies' app needs. The purchase comes on the heels of H-P rival Dell's ( DELL ) acquisition of 3Par, a storage- and virtualization-services company.
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If that pace of growth continues, H-P and Dell would do well to capitalize on the enterprise software and services market. The purchase comes on the heels of H-P rival Dell's ( DELL ) acquisition of 3Par, a storage- and virtualization-services company. Both deals were made in a bid to prop up H-P and Dell's presence in the lucrative enterprise-computing market.
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At present, Dell only derives a tiny fraction of its revenue from storage services; H-P, meanwhile, says Fortify will help it offer a holistic solution to companies' app needs. If that pace of growth continues, H-P and Dell would do well to capitalize on the enterprise software and services market. The purchase comes on the heels of H-P rival Dell's ( DELL ) acquisition of 3Par, a storage- and virtualization-services company.
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The purchase comes on the heels of H-P rival Dell's ( DELL ) acquisition of 3Par, a storage- and virtualization-services company. Both deals were made in a bid to prop up H-P and Dell's presence in the lucrative enterprise-computing market. At present, Dell only derives a tiny fraction of its revenue from storage services; H-P, meanwhile, says Fortify will help it offer a holistic solution to companies' app needs.
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4552dc7d-4550-4dec-8074-d20ceec52bc3
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727026.0
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2010-08-16 00:00:00 UTC
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Dell announces acquisition plans
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DELL
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https://www.nasdaq.com/articles/dell-announces-acquisition-plans-2010-08-16
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nan
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nan
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PC builder Dell Inc. ( DELL ) announced Monday that it would pay $1.15 billion for 3Par, a storage-technology company that competes with EMC and other storage giants.
The move could give Dell valuable access to the burgeoning cloud-services market. Dell's chief rival, Hewlett-Packard, has successfully positioned itself as a provider of both hardware and services to enterprise clients, and the Round Rock, Texas-based firm may be attempting to compete more directly with H-P.
Dell will pay $18 for each share of 3Par - a generous premium to the stock's August 13 closing price of $9.65. The company's willingness to offer such a large premium hints at its desire to move aggressively into the cloud-storage space; in July, it bought another storage-services company, Ocarina Networks.
The senior vice president of Dell's Enterprise Product Group, Brad Anderson, indicated that the company bought 3Par to round out its corporate-service offerings. "3Par brings the same values of performance, agility and ease-of-use to higher-end, virtualized storage deployments as EqualLogic does for the entry-level and mid-range, rounding out our industry-leading solutions portfolio," he said.
By Benjamin Foster
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell's chief rival, Hewlett-Packard, has successfully positioned itself as a provider of both hardware and services to enterprise clients, and the Round Rock, Texas-based firm may be attempting to compete more directly with H-P. Dell will pay $18 for each share of 3Par - a generous premium to the stock's August 13 closing price of $9.65. The senior vice president of Dell's Enterprise Product Group, Brad Anderson, indicated that the company bought 3Par to round out its corporate-service offerings. PC builder Dell Inc. ( DELL ) announced Monday that it would pay $1.15 billion for 3Par, a storage-technology company that competes with EMC and other storage giants.
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PC builder Dell Inc. ( DELL ) announced Monday that it would pay $1.15 billion for 3Par, a storage-technology company that competes with EMC and other storage giants. The move could give Dell valuable access to the burgeoning cloud-services market. Dell's chief rival, Hewlett-Packard, has successfully positioned itself as a provider of both hardware and services to enterprise clients, and the Round Rock, Texas-based firm may be attempting to compete more directly with H-P. Dell will pay $18 for each share of 3Par - a generous premium to the stock's August 13 closing price of $9.65.
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PC builder Dell Inc. ( DELL ) announced Monday that it would pay $1.15 billion for 3Par, a storage-technology company that competes with EMC and other storage giants. Dell's chief rival, Hewlett-Packard, has successfully positioned itself as a provider of both hardware and services to enterprise clients, and the Round Rock, Texas-based firm may be attempting to compete more directly with H-P. Dell will pay $18 for each share of 3Par - a generous premium to the stock's August 13 closing price of $9.65. The senior vice president of Dell's Enterprise Product Group, Brad Anderson, indicated that the company bought 3Par to round out its corporate-service offerings.
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PC builder Dell Inc. ( DELL ) announced Monday that it would pay $1.15 billion for 3Par, a storage-technology company that competes with EMC and other storage giants. The move could give Dell valuable access to the burgeoning cloud-services market. Dell's chief rival, Hewlett-Packard, has successfully positioned itself as a provider of both hardware and services to enterprise clients, and the Round Rock, Texas-based firm may be attempting to compete more directly with H-P. Dell will pay $18 for each share of 3Par - a generous premium to the stock's August 13 closing price of $9.65.
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6c84104f-b8a0-49f6-ab1e-a3e7cdfa111a
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727027.0
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2010-08-16 00:00:00 UTC
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Don’t be Fooled by a Reaction Rally
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DELL
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https://www.nasdaq.com/articles/dont-be-fooled-reaction-rally-2010-08-16
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nan
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nan
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Yesterday, stocks were mixed with the indices flat at the closing bell. And the volume was the lightest of the year on both the NYSE and Nasdaq.
To non-participants, that hot August day appeared to have been just another very boring session following a sell-off, but to those participating, it was a highly charged battle with big swings in the indices.
The Dow Industrials plunged 100 points on the opening, then rallied. By 10:30 a.m., almost all of the early losses had been erased. But in the early afternoon, broad-based selling drove stocks down again, but this time the selling abated at half the morning's losses. At 3:15 p.m., the Dow was off about 60 points and drifting south, but late buying turned the market again, and by the close almost all of the losses had been regained for the second time in the session.
There were few reasons for the volatility other than low volume, which tends to exaggerate volatility as stocks are flipped by quick-footed traders. A lower-than-expected annualized Q2 GDP from Japan, renewed selling in Europe, and a smaller-than-expected rise in the August Empire Manufacturing Index, along with the downside momentum of last week, contributed to the lower opening.
The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. During the last four weeks, the technology sector has experienced a decline of 2.2%, so it was subject to some bargain hunting.
The Federal Reserve said that its bank loan survey showed that business and consumer loan demand was flat. That announcement contributed to the mid-afternoon sell-off.
For-profit education stocks fell following reports of poor loan repayment rates at Strayer Education, Inc. (NASDAQ: STRA ). And analysts at Deutsche Bank AG (NYSE: DB ) downgraded Corinthian Colleges, Inc. (NASDAQ: COCO ), which fell 21.62% and added to the woes of that group.
The U.S. dollar ended the day lower against both the euro and the yen with the euro at $1.2817.
At the final bell, the Dow Jones Industrial Average was off a fraction at 10,302, the S&P 500 rose slightly to 1,079, and the Nasdaq gained 8 points, closing at 2,182.
Volume on the NYSE totaled 788 million shares, the lowest of the year, and advancers were ahead of decliners by 1.64-to-1. The Nasdaq traded 477 million shares with advancers ahead by the same margin as the NYSE.
September crude oil fell 15 cents to $75.24 a barrel, and the Energy Select Sector SPDR (NYSE: XLE ) fell a penny to $53.34.
December gold rose 10 cents to settle at $1,226.20 an ounce. The PHLX Gold/Silver Sector Index (NASDAQ: XAU ) rose 2.59 points to 174.99.
What the Markets Are Saying
Yesterday's volatile, low-volume session may have had its exciting moments, but in the end it accomplished little for the bulls.
The first minutes of trading erupted into another gap down, but as noted, prices reversed, and the morning's gap was quickly covered and the losses overcome. At the end of the day, sellers were still in charge, but buyers were able to garner enough strength to avoid a breakdown, but unable to cover any of last week's downside gaps.
The Dow and the S&P 500 are range bound by their respective 50-day moving averages on the top and the July 20 lows at the bottom. And with volume at the lowest level of the year, it is likely that trading will be contained within that zone for some time.
But the Nasdaq's chart, with two enormous downside gaps, is quite different. Yesterday, the technology sector dragged the Nasdaq to an 8-point advance. But the outlook for the junior index is so bad that it will take more than a modest session of bargain hunting to overcome the damage. And a close under 2,150 could launch an all-out round of panic selling.
With most of the internal indicators now modestly oversold, the market is due for a reaction rally, but that's all. The pressure now exerted by the bears is heavy, so the bulls must hold the current support through mid-September or be drowned in a sea of sellers.
Today's Trading Landscape
Earnings to be reported before the opening include: Abercrombie & Fitch, Blue Phoenix, Elbit Systems, G&K Services, Home Depot, Saks, TJX Companies, VanceInfo Technologies and Wal-Mart.
Earnings to be reported after the close include: Analog Devices, Bob Evans, China Digital TV, Jack Henry, La-Z-Boy and Longtop Financial Technologies.
Economic reports due: e-commerce retail sales, ICSC-Goldman Sachs store sales, housing starts (the consensus expects 565,000), producer price index (the consensus expects 0.2%, and 0.1% ex-food and energy), Redbook, and industrial production (the consensus expects 0.6%, and 74.5% capacity utilization rate).
If you have questions or comments for Sam Collins, please e-mail him at samailc@cox.net .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. A lower-than-expected annualized Q2 GDP from Japan, renewed selling in Europe, and a smaller-than-expected rise in the August Empire Manufacturing Index, along with the downside momentum of last week, contributed to the lower opening. Today's Trading Landscape Earnings to be reported before the opening include: Abercrombie & Fitch, Blue Phoenix, Elbit Systems, G&K Services, Home Depot, Saks, TJX Companies, VanceInfo Technologies and Wal-Mart.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. For-profit education stocks fell following reports of poor loan repayment rates at Strayer Education, Inc. (NASDAQ: STRA ). The Nasdaq traded 477 million shares with advancers ahead by the same margin as the NYSE.
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. At the final bell, the Dow Jones Industrial Average was off a fraction at 10,302, the S&P 500 rose slightly to 1,079, and the Nasdaq gained 8 points, closing at 2,182. Economic reports due: e-commerce retail sales, ICSC-Goldman Sachs store sales, housing starts (the consensus expects 565,000), producer price index (the consensus expects 0.2%, and 0.1% ex-food and energy), Redbook, and industrial production (the consensus expects 0.6%, and 74.5% capacity utilization rate).
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The Nasdaq bounced more than its sister indices, and was led by the technology sector that rallied following Dell Inc.'s (NASDAQ: DELL ) acquisition of 3PAR Inc. (NYSE: PAR ), which jumped 87% on the news. At 3:15 p.m., the Dow was off about 60 points and drifting south, but late buying turned the market again, and by the close almost all of the losses had been regained for the second time in the session. At the end of the day, sellers were still in charge, but buyers were able to garner enough strength to avoid a breakdown, but unable to cover any of last week's downside gaps.
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8e12322f-a106-44a6-b945-b28ab75feaf9
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727028.0
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2010-08-16 00:00:00 UTC
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Opening View: DJIA Extends Losses on Weak Japanese GDP
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DELL
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https://www.nasdaq.com/articles/opening-view-djia-extends-losses-weak-japanese-gdp-2010-08-16
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nan
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nan
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The Dow Jones Industrial Average (DJIA) plunged more than 3% last week, as traders lost confidence in the strength of the global economic recovery. The Dow held support near 10,300 for the week, but that support level will be tested once again this morning, as futures on the DJIA are pointing toward an opening loss of about 30 points. Elsewhere, S&P 500 Index (SPX) futures are trading roughly 4.5 points below fair value, placing the broad-market index on a collision course with last week's low near 1,076. The focus in early Wall Street action is the weaker-than-expected report on Japanese gross domestic product and today's release of the New York Fed's Empire State manufacturing index. Finally, VIX watchers should note that the CBOE Market Volatility Index (VIX) closed above its 10-week moving average for the first time since June 11 on Friday. Last week's heavy losses on Wall Street drove volatility higher once again, but the VIX still remains capped by resistance in the 27 area, above which the index has not closed a session since July 6.
In equity news, Dell Inc. ( DELL ) announced that it is buying 3Par Inc. ( PAR ) for $18 per share. The offer values PAR at an 86% premium to the stock's close at $9.65 per share on Friday. Dell said the acquisition would add to its earnings starting in 2012.
Elsewhere, Lowe's Companies Inc. ( LOW ) reported second-quarter earnings of $832 million, or 58 cents per share, as sales grew to $14.4 billion. Analysts were expecting a profit of 59 cents per share. Looking ahead, the company sees third-quarter earnings of 28 cents to 32 cents per share, with fiscal 2010 earnings coming in the range of $1.38 to $1.45 per share.
Earnings Preview
On the earnings front, Agilent Technologies Inc. ( A ), Sysco Corp. ( SYY ), and Urban Outfitters Inc. ( URBN ) are scheduled to release their quarterly earnings report today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
The New York Fed will release its Empire State Manufacturing Survey for August today, but traders will have a lot of economic data to consider on Tuesday. The Commerce Department will release reports on housing starts and building permits for July, while the Labor Department will supply July readings on the Producer Price Index (PPI) and the core PPI. Meanwhile, the Federal Reserve will report on industrial production in July. The usual weekly report on U.S. petroleum supplies is due on Wednesday. The weekly report on initial jobless claims will be released on Thursday, along with the Conference Board's Leading Indicators Index for July, and the Philadelphia Fed Index for August. There are no major economic reports scheduled for Friday.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 775,613 call contracts traded on Friday, compared to 518,793 put contracts. The resultant single-session put/call ratio arrived at 0.67, while the 21-day moving average held at 0.61.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
Overseas Trading
Overseas trading remains weak this morning, as only three of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a loss of 0.06%. Weaker-than-expected gross domestic product ( GDP ) out of Japan set a bearish tone in early Asian trading, but Chinese stocks bucked the overall downtrend to finish more than 2% higher. According to economists, Japan's weak GDP hints that the country could be overtaken by China as the world's second-largest economy. In Europe, stocks took their cues from Asia, heading lower in early trading activity.
Currencies and Commodities
The U.S. Dollar Index is pulling back from resistance near the 83 level in Asian trading, as the euro and the yen rebounded from near-term lows. Currently, the index is hovering above support in the 82.50 region, after falling 0.51% to 82.53. In commodities, gold continues to benefit from safe-haven buying, with the precious metal gaining $7.90 to trade at $1,224.50 in London. Finally, crude prices have rebounded from support, and are up 34 cents at $76.11 per barrel.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Follow Schaeffer's to the San Francisco MoneyShow Aug. 19 -- 21, 2010! Click here for details, including a list of scheduled presentations and how to register.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In equity news, Dell Inc. ( DELL ) announced that it is buying 3Par Inc. ( PAR ) for $18 per share. Dell said the acquisition would add to its earnings starting in 2012. The focus in early Wall Street action is the weaker-than-expected report on Japanese gross domestic product and today's release of the New York Fed's Empire State manufacturing index.
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In equity news, Dell Inc. ( DELL ) announced that it is buying 3Par Inc. ( PAR ) for $18 per share. Dell said the acquisition would add to its earnings starting in 2012. The focus in early Wall Street action is the weaker-than-expected report on Japanese gross domestic product and today's release of the New York Fed's Empire State manufacturing index.
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In equity news, Dell Inc. ( DELL ) announced that it is buying 3Par Inc. ( PAR ) for $18 per share. Dell said the acquisition would add to its earnings starting in 2012. The focus in early Wall Street action is the weaker-than-expected report on Japanese gross domestic product and today's release of the New York Fed's Empire State manufacturing index.
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In equity news, Dell Inc. ( DELL ) announced that it is buying 3Par Inc. ( PAR ) for $18 per share. Dell said the acquisition would add to its earnings starting in 2012. Finally, VIX watchers should note that the CBOE Market Volatility Index (VIX) closed above its 10-week moving average for the first time since June 11 on Friday.
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3f4a08f9-83cd-4138-b7a7-17931eb07fed
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727029.0
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2010-08-11 00:00:00 UTC
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3 Beaten-down Tech Stocks Set for a Rebound
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DELL
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https://www.nasdaq.com/articles/3-beaten-down-tech-stocks-set-rebound-2010-08-11
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nan
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nan
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Bearish comments from analysts at JP Morgan and Robert W. Baird this week regarding tech spending has put an already-weak sector under even greater pressure. Major tech names like Intel (Nasdaq: INTC) and Dell (Nasdaq: DELL) are retreating from recent gains and some tech stocks are quickly falling into the abyss.
On Tuesday, shares of Applied Materials (Nasdaq: AMAT) , Seagate Technology ( STX ) , and Symantec (Nasdaq: SYMC) all hit 52-week lows. For existing shareholders, it's fair to wonder if it's time to cut their losses. And for investors that have avoided this sector as it has tumbled, do these newly-cheapened stocks signal it's time to jump in? Let's take a look...
Applied Materials
One of the key challenges for all tech stocks involves the steep peaks and dips in revenue and profit streams. With such robust swings, investors always apply relatively low multiples. In the area of semiconductors, investors are often even more wary, as capital spending cycles enter into boom and bust cycles with alarming frequency. Applied Materials, for example, saw sales plunge -38% in fiscal (October) 2009, yet is in the midst of a fresh growth spurt this year that should boost sales +70% to +80%.
But fear springs eternal for this sector, and investors are already bracing for the next plunge. Perhaps that fear is quite premature. After all, capital spending for advanced semiconductor equipment -- for which Applied Materials is the acknowledged global leader -- is often a function of the cash customers have at their disposal. Right now, Applied Materials' customers are fattening their balance sheets again after a string of solid results from chip makers.
Looking ahead, analysts still think Applied Materials will see sales grow in fiscal (October) 2011, perhaps in the +10% to 20% range. That may prove to be optimistic or pessimistic, but one thing is for sure: the company generates loads of cash in good times or bad. Sure, it lost $235 million in free cash flow in 2009, but it generated $6.7 billion in positive free cash flow during the previous five years. It would take an absolute plunge in global chip equipment spending for Applied Materials to move back into the red in terms of free cash flow.
In a bid to please investors, Applied Materials recently shut down its money-losing SunFab unit that makes thin-film solar panels. That move is expected to boost profits and once again tighten the company's core focus on the semiconductor business (although it will retain some exposure to the solar industry). That move should allow gross margins to rise back up next year into the mid 40% range from a current 39%, according to Needham & Co. Operating margins should also rebound back into the low 20% range. Yet shares have moved even lower since that July 21st announcement and are now at levels last seen in 2003 (excepting the early 2009 swoon which cratered many stocks).
Assuming sales rise at a moderate pace in 2011, as analysts currently expect, then free cash flow could approach $1.5 billion -- roughly in line with what Applied Materials generated in 2006 and 2007. Back then, shares traded in a range of $15 to $25 -- well above the current price near $11.15.
As is the case with many tech stocks these days, Applied Materials can only rely on one catalyst to support shares: stock buybacks. The company's share count has already shrunk from 1.7 billion shares in 2004 to a recent 1.34 billion. The company could continue buying back 100 million shares annually without cutting into R&D spending or its $3 billion in cash and investments.
Applied Materials is expected to report third quarter results next Wednesday, August 18th. Management noted in July that the quarter was faring well, and if recent quarterly conference calls are any guide, management should again speak of a still-rising backlog of orders. Perhaps that will be what it takes to get shares out of the summer doldrums.
Seagate Technology
This hard-disk drive maker is also a victim of lousy sentiment toward the entire industry. Those bearish comments noted earlier from JP Morgan and Robert W. Baird specifically cited concerns about a slowdown in spending on PCs and servers. Seagate, which has exposure to both volume and pricing (both metrics are good when demand is strong, and bad when they're not) surely can post erratic numbers. When business was lousy in fiscal (June) 2009, the company barely broke even in terms of free cash flow. Yet in the fiscal year just ended, free cash flow surged to more than $1 billion. But the recent quarterly results also highlighted an emerging slowdown in demand, thanks in large part to cautious spending trends in Europe.
Yet even as sales weaken a bit, Seagate remains highly profitable. Analysts had been expecting EPS in the $3.60 range for both fiscal 2011 and 2012, but thanks to the incipient slowdown, have lowered those forecasts by a little more than a dollar to about $2.40. Seagate's shares trade for less than five times those lowered 2011 and 2012 profit projections.
To be sure, few positive catalysts exist in the near-term, so this stock is of much greater appeal to deep value investors than growth investors. Yet if the economy does begin to turn around, Seagate is a very high beta stock and could quickly double from current levels. Right now, few are envisioning such a scenario, as evidenced by Tuesday's new yearly low.
Symantec
This security software maker has been in the doghouse ever since it acquired computer storage firm Veritas in 2005 for more than $13 billion. Investors didn't see the synergies of the deal back then, and they still don't. Adding insult, results at both of these disparate divisions began to lag their respective rivals, perhaps due to management's lost focus.
Even as organic growth has been lacking, Symantec has been a free cash flow machine, routinely spitting out about $1.4 billion in free cash flow, year after year. To boost growth, the company has put that prodigious cash flow back into play, recently acquiring a security software division from Verisign (Nasdaq: VRSN) for $1.3 billion. At least this deal has real synergies.
Symantec's ever-sinking stock is the result of tepid guidance issued in late July making clear that key customers were taking a longer time to commit to big new contracts. Like Seagate, Symantec has become a company with dim top-line prospects, but still-robust bottom-line prospects. And in this market, that trade-off holds little appeal.
Action to Take --> Interested investors may want to check out Applied Materials' conference call next Wednesday to get the latest outlook on this seemingly moribund sector.
Applied Materials is the healthiest among these three stocks, though with shares trading for a little over 15 times projected profits, it lacks the absolute rock-bottom valuations seen with Seagate (4.5) and Symantec (9.6). All three of these companies are either first or second in the industries they operate and should rise anew when investors rotate back into the tech sector.
-- David Sterman
David Sterman started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and a Managing Editor at TheStreet.com. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Major tech names like Intel (Nasdaq: INTC) and Dell (Nasdaq: DELL) are retreating from recent gains and some tech stocks are quickly falling into the abyss. Assuming sales rise at a moderate pace in 2011, as analysts currently expect, then free cash flow could approach $1.5 billion -- roughly in line with what Applied Materials generated in 2006 and 2007. To boost growth, the company has put that prodigious cash flow back into play, recently acquiring a security software division from Verisign (Nasdaq: VRSN) for $1.3 billion.
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Major tech names like Intel (Nasdaq: INTC) and Dell (Nasdaq: DELL) are retreating from recent gains and some tech stocks are quickly falling into the abyss. Sure, it lost $235 million in free cash flow in 2009, but it generated $6.7 billion in positive free cash flow during the previous five years. It would take an absolute plunge in global chip equipment spending for Applied Materials to move back into the red in terms of free cash flow.
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Major tech names like Intel (Nasdaq: INTC) and Dell (Nasdaq: DELL) are retreating from recent gains and some tech stocks are quickly falling into the abyss. It would take an absolute plunge in global chip equipment spending for Applied Materials to move back into the red in terms of free cash flow. Even as organic growth has been lacking, Symantec has been a free cash flow machine, routinely spitting out about $1.4 billion in free cash flow, year after year.
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Major tech names like Intel (Nasdaq: INTC) and Dell (Nasdaq: DELL) are retreating from recent gains and some tech stocks are quickly falling into the abyss. On Tuesday, shares of Applied Materials (Nasdaq: AMAT) , Seagate Technology ( STX ) , and Symantec (Nasdaq: SYMC) all hit 52-week lows. Back then, shares traded in a range of $15 to $25 -- well above the current price near $11.15.
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6acce6dc-94cd-403b-a4cb-d5763c10bb26
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727030.0
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2010-07-14 00:00:00 UTC
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Wednesday Winners: Intel, Expeditors Intl and Adtran
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DELL
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https://www.nasdaq.com/articles/wednesday-winners-intel-expeditors-intl-and-adtran-2010-07-14
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nan
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nan
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Among the biggest winners in Wednesday's early trading are Intel (Nasdaq: INTC) , Expeditors Int'l (Nasdaq: EXPD) and Adtran (Nasdaq: ADTN) .
Intel sets a Positive Tone
Luckily for tech investors, Intel (Nasdaq: INTC) has weighed in with quarterly results at the very beginning of earnings season . Rather than wait it out for weeks to see if the sky is falling (as shares of high tech companies seem to indicate these days), Intel has quickly established a bullish tone for the whole tech sector. On Tuesday evening, the chip giant announced second quarter sales of $10.8 billion -- roughly +5% ahead of forecasts -- and earnings per share of $0.51, which was roughly +15% ahead of consensus estimates. That's good for a +4% gain in Wednesday trading. The results are all the more impressive when you consider that Europe is likely mired in a slump. That means that the North American and Asian markets were robust.
Intel also spoke positively about anticipated results for the third quarter, noting that both sales and gross margins should come in above consensus estimates. Some of this strength is attributable to Intel's market-leading position. But it's also due to a robust level of spending on computers, which is why firms like Dell (Nasdaq: DELL) and Seagate ( STX ) are also up nicely in Wednesday trading.
Action to Take --> With Wednesday's gain, shares of Intel still seem reasonably priced at around 10 ten times likely fiscal 2011 profits. When investors come to believe that this rebound is sustainable, that forward price-to-earnings ratio (P/E) should move up into the 12 to 14 range.
------------------------------------
Expeditors doesn't see a Slowdown
Just as Intel has signaled a bullish tone for tech spending, Expeditors International (Nasdaq: EXPD) suggests that the broader economy is also faring well. The company provides a wide range of services to air and ocean-based freight shippers, and notes that all manners of shipping activity were strong in the second quarter. "Our customers seem to be doing well as compared with 2009," said chairman and CEO Peter Rose in a company press release.
It's clear that the global economy faces stiff challenges, but reports like these also underscore the notion an imminent re-collapse in the global economy is just not in the cards. Much of the trading action in stock markets throughout May and June implied that investors should remain fearful, but if we get more commentary from other firms like this, and if earnings season doesn't hold too many bombshells, we may be in for a robust summer rally.
Action to Take --> Expeditors pre-announced robust profits for its second quarter on Tuesday evening, though it declined to provide specific revenue details. However, investors shouldn't get carried away with this stock. The +7% gain today leaves shares trading at more than 15 times likely upwardly revised projected 2011 profits. Considering that global economic headwinds remain in place, a higher multiple isn't warranted right now.
------------------------------------
Adtran validates Tyco
Just a day after its rival, ADC Telecom (Nasdaq: ADCT) agreed to be bought by Tyco ( TYC ) , Adtran (Nasdaq: ADTN) announced solid quarterly results. Sales rose +24% from a year ago, while profits surged +47%. Adtran provides high-speed network connection equipment to telecom operators and large enterprises. Management notes that demand is strong in every niche in which the company operates.
Action to Take --> We'll have a deeper look at this whole group and identify what Tyco's acquisition means, in a separate article later today.
-- David Sterman
David Sterman has worked as an investment analyst for nearly two decades. He started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and has made numerous media appearances over the years, primarily on CNBC and Bloomberg TV. David has a master's degree in management from Georgia Tech. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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But it's also due to a robust level of spending on computers, which is why firms like Dell (Nasdaq: DELL) and Seagate ( STX ) are also up nicely in Wednesday trading. The company provides a wide range of services to air and ocean-based freight shippers, and notes that all manners of shipping activity were strong in the second quarter. Much of the trading action in stock markets throughout May and June implied that investors should remain fearful, but if we get more commentary from other firms like this, and if earnings season doesn't hold too many bombshells, we may be in for a robust summer rally.
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But it's also due to a robust level of spending on computers, which is why firms like Dell (Nasdaq: DELL) and Seagate ( STX ) are also up nicely in Wednesday trading. Among the biggest winners in Wednesday's early trading are Intel (Nasdaq: INTC) , Expeditors Int'l (Nasdaq: EXPD) and Adtran (Nasdaq: ADTN) . On Tuesday evening, the chip giant announced second quarter sales of $10.8 billion -- roughly +5% ahead of forecasts -- and earnings per share of $0.51, which was roughly +15% ahead of consensus estimates.
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But it's also due to a robust level of spending on computers, which is why firms like Dell (Nasdaq: DELL) and Seagate ( STX ) are also up nicely in Wednesday trading. Among the biggest winners in Wednesday's early trading are Intel (Nasdaq: INTC) , Expeditors Int'l (Nasdaq: EXPD) and Adtran (Nasdaq: ADTN) . Intel sets a Positive Tone Luckily for tech investors, Intel (Nasdaq: INTC) has weighed in with quarterly results at the very beginning of earnings season .
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But it's also due to a robust level of spending on computers, which is why firms like Dell (Nasdaq: DELL) and Seagate ( STX ) are also up nicely in Wednesday trading. Intel sets a Positive Tone Luckily for tech investors, Intel (Nasdaq: INTC) has weighed in with quarterly results at the very beginning of earnings season . Much of the trading action in stock markets throughout May and June implied that investors should remain fearful, but if we get more commentary from other firms like this, and if earnings season doesn't hold too many bombshells, we may be in for a robust summer rally.
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02a28d6e-b67e-4de9-8213-cf1384019b3b
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727031.0
|
2010-07-13 00:00:00 UTC
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Apple's Biggest Fear
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DELL
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https://www.nasdaq.com/articles/apples-biggest-fear-2010-07-13
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nan
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nan
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In the land of consumer technology, it's hard to stay as the king of the hill. Two decades ago, Sony ( SNE ) ruled the roost, with its hot-selling Walkmans and Trinitron TVs. About a decade ago, Nokia ( NOK ) looked poised to dominate the global cell phone market, and more recently, Motorola's ( MOT ) RAZR set that company up for a long-term run as a consumer favorite. All those companies can now be seen in Apple's (Nasdaq: AAPL) rear-view mirror.
With each passing year, Apple's brand only seems to get stronger. Forget about this month's iPhone antenna glitch, which has pushed shares down from their peak. Those kinds of issues are just noise, and will soon be forgotten. But on a much broader level, there's real reason for concern. Just as Apple is celebrating a successful rollout of the iPad and the latest version of the iPhone, a key competitor is set to steal Apple's thunder.
The competitor in question: well, it's a $155 billion (in market value) company that made a name for itself in the field of Internet search. Yes, just six miles up the road from Apple's Cupertino, Calif., headquarters lies the campus of Google (Nasdaq: GOOG) -- the tech behemoth that has spent the last two years laying the groundwork to beat Apple at its own game. And during the next few quarters, get ready for a torrent of new products in all shapes and sizes that run on Google's Android software. A host of new rivals for the iPhone? Check. A host of new rivals for the iPad? Check. Panasonic and others are now talking about adding Android software to flat panel TVs. Google is even hinting that a range of appliances found in your kitchen will soon have an Android browser.
Right about now, you can start to question whether Google can develop software and services that are even more compelling than those offered by Apple. They don't have to be. Good enough is good enough. The key distinction is that Google's Android will be ubiquitous. You'll find it on Dell's (Nasdaq: DELL) upcoming Streak tablet computer. You'll find it on Motorola's next line of smart phones. And you can expect giants such as Cisco Systems (Nasdaq: CSCO) and IBM ( IBM ) to start to embrace Android. In essence, Apple has created a closed universe, and Google has created an open one. And in the world of high-tech, open standards always win out.
How much market share Google can take is just one question you need to ask. The other involves the impact on Apple's business model presented by this rival that often gives its products away at low or no cost. Apple's products typically garner a premium price, which is why operating margins have expanded for six straight years and now approach 30%.
Inevitably, Apple will have to price its products closer to the peer group, which will likely eat into those robust profit margins. And that's all you need to know about profit growth. If sales keep rising but margins start to shrink, profit growth is likely to cool.
Apple has boosted earnings per share by at least +33% every year for each of the last six years. And it's on track to grow a heady +50% this year, according to consensus forecasts. And then the Google vortex is scheduled to rumble through town. Apple's new fiscal year starts October 1, which is right around the time that a whole new set of Google-powered tablet computers, smart phones and perhaps TVs are set to hit the market. Which is why analysts think EPS growth will cool to around +20% in fiscal (September) 2011. Apple tends to handily exceed analysts' forecasts, so even as headwinds build, Apple could still post a solid set of results in 2011.
But savvy investors always look ahead. And as they look beyond 2011, they'll start to see that it's a Google world -- and we just live in it.
Action to Take --> The technical issues regarding the iPhone are only temporary, and once Apple announces a fix, shares could quickly move back toward the $280 all-time high. But as the Google onslaught starts to build, Apple's never-ending winning streak will likely come into question. Shares are not likely to plunge precipitously, but 2010 may turn out to be the year of the peak. It happened to Sony, it happened to Nokia, and soon enough, it may happen to Apple.
-- David Sterman
David Sterman has worked as an investment analyst for nearly two decades. He started his career in equity research at Smith Barney, culminating in a position as Senior Analyst covering European banks. David has also served as Director of Research at Individual Investor and has made numerous media appearances over the years, primarily on CNBC and Bloomberg TV. David has a master's degree in management from Georgia Tech. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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You'll find it on Dell's (Nasdaq: DELL) upcoming Streak tablet computer. About a decade ago, Nokia ( NOK ) looked poised to dominate the global cell phone market, and more recently, Motorola's ( MOT ) RAZR set that company up for a long-term run as a consumer favorite. Action to Take --> The technical issues regarding the iPhone are only temporary, and once Apple announces a fix, shares could quickly move back toward the $280 all-time high.
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You'll find it on Dell's (Nasdaq: DELL) upcoming Streak tablet computer. Apple's new fiscal year starts October 1, which is right around the time that a whole new set of Google-powered tablet computers, smart phones and perhaps TVs are set to hit the market. StreetAuthority The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. © Copyright 2001-2010 StreetAuthority, LLC.
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You'll find it on Dell's (Nasdaq: DELL) upcoming Streak tablet computer. Just as Apple is celebrating a successful rollout of the iPad and the latest version of the iPhone, a key competitor is set to steal Apple's thunder. Yes, just six miles up the road from Apple's Cupertino, Calif., headquarters lies the campus of Google (Nasdaq: GOOG) -- the tech behemoth that has spent the last two years laying the groundwork to beat Apple at its own game.
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You'll find it on Dell's (Nasdaq: DELL) upcoming Streak tablet computer. How much market share Google can take is just one question you need to ask. Apple has boosted earnings per share by at least +33% every year for each of the last six years.
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263e9286-b8e0-497a-83d9-7d17f9c4aee3
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727032.0
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2010-07-08 00:00:00 UTC
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Job Creation and a Way Out of America's FIRE Economy
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DELL
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https://www.nasdaq.com/articles/job-creation-and-way-out-americas-fire-economy-2010-07-08
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nan
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nan
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Firat Ünlü submits:
Everyone and his dog is now engaged in debate which aims to find ways to boost job creation in the US. More than a fair few are proposing further stimulus programmes. They wrongly tend to call it "second stimulus" - it is far from being the second one.
It's not like the Bush tax cuts and Fed-inspired interest rate cuts could or should be excluded. In fact, one could argue that America has been on a debt-fuelled stimulus since the 1980s when total debt in relation to GDP went from 160% to more than 36 0%. Steve Keen argues that the contribution to demand from rising private debt was far greater during the recent boom than during the Roaring Twenties - accounting for over 22% of aggregate demand versus a mere 8.7% in 1928.
People argue against increased government spending based on the fact that the private sector does indeed have a better grip on what constitutes productive spending, but one could again make a decent case that recent private spending was from inducing sustainable growth.
What distorts the debate, however, is that proponents of stimulus spending point to good uses of public money, such as infrastructure and energy, which do actually provide a decent return on investment - but because of the practicality of government spending we will see those funds go nowhere near a productive use. How you put the money to work makes all the difference. What has China done? They built up the necessary infrastructure that enables exporters to move into the cheaper Western provinces and gives coastal provinces the opportunity to move up the value chain. They can even allow the RMB to rise higher.
We have had a massive stimulus for decades. It's time to acknowledge this fact and realize that it did not contribute to a healthy economic structure. As a German I am wary of economists bluntly explaining trade differentials by proclaiming undervalued currencies all over the world. As long as financing is available and consumption rates differ to a large degree, as they do in the case of America and China, imports and exports need not be balanced. In fact America runs a trade deficit with almost any nation, quite a feat.
The problem isn't really the incurred debt. What's problematic is that if this process goes on for decades, the economy will be shaped by it and respond with job creation in those areas.
The FIRE economy (Finance/Insurance/Real Estate) did not come out of nowhere, it was a direct result of people responding to incentives. The correlation between changes in private debt and unemployment is strikingly high.
Exports to the Fore!
If changes in aggregate demand and unemployment were thus highly affected by changes in debt, gaining jobs by increasing exports looks like a way out; hence, I thought it would be interesting to have a closer look at the structure of the US economy. Unfortunately, I have come to the conclusion that job creation is all but impossible unless the structure changes.
projection(Click to enlarge)
(Click to enlarge)
Just as an example, Korea exported 8,410 cars to the US while it imported a mere 492. What this shows is that other nations have already staked their claim in traditional industries. There was even a $60 billion deficit in advanced technology.
If this route is seemingly blocked, one might try pushing into new areas, and the US has a very good track record on that one. Companies like Intel ( INTC ) and Apple ( AAPL ) are proof enough. Andy Grove, however, noted that start-ups can't really help on this issue as the process of scaling largely happens in Asia. For every American Apple or Dell ( DELL ) worker, there's ten in Asia.
A Way Out?
There might be a way out, but this one needs much more research. What's been left out so far is the issue of deflation. Philosophically, I would argue that deflation needs to run its course and that prices need to come down to their true level. However, this blends out the enormous challenge posed by debt-deflation. Hereby, I agree with Mish's definition of deflation as a net contraction of money and credit.
Now, if credit in the private sector is destroyed faster than money printed by the Fed (for the public sector), would this open up the way to hold up fiscal measures via QE and avoid debt-deflation? The UK is experiencing roughly 5% inflation as the Bank of England did a year's worth of deficit printing, but they're holding out fine.
Yes, I understand that savers and bondholders get punished and yes, this is terribly bad ethics, but it might just be the least worst way out. Former German Bundesbank President Otmar Emminger is famous for saying "if you flirt with inflationyou end up marrying it " but unless we find a way out of this it may not only be capitalism that's at stake but democracy.
The Chinese Communist Party will have a field day justifying its rule when it can point out to riots in democratic hotbeds such as the UK and America. This is about more than economics.
Disclosure: No positions
See also Our 3 Favorite Leading Stock Market Indicators on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For every American Apple or Dell ( DELL ) worker, there's ten in Asia. As long as financing is available and consumption rates differ to a large degree, as they do in the case of America and China, imports and exports need not be balanced. If changes in aggregate demand and unemployment were thus highly affected by changes in debt, gaining jobs by increasing exports looks like a way out; hence, I thought it would be interesting to have a closer look at the structure of the US economy.
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For every American Apple or Dell ( DELL ) worker, there's ten in Asia. People argue against increased government spending based on the fact that the private sector does indeed have a better grip on what constitutes productive spending, but one could again make a decent case that recent private spending was from inducing sustainable growth. What distorts the debate, however, is that proponents of stimulus spending point to good uses of public money, such as infrastructure and energy, which do actually provide a decent return on investment - but because of the practicality of government spending we will see those funds go nowhere near a productive use.
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For every American Apple or Dell ( DELL ) worker, there's ten in Asia. People argue against increased government spending based on the fact that the private sector does indeed have a better grip on what constitutes productive spending, but one could again make a decent case that recent private spending was from inducing sustainable growth. What distorts the debate, however, is that proponents of stimulus spending point to good uses of public money, such as infrastructure and energy, which do actually provide a decent return on investment - but because of the practicality of government spending we will see those funds go nowhere near a productive use.
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For every American Apple or Dell ( DELL ) worker, there's ten in Asia. As long as financing is available and consumption rates differ to a large degree, as they do in the case of America and China, imports and exports need not be balanced. In fact America runs a trade deficit with almost any nation, quite a feat.
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6a7c88e9-e4ca-4e48-abeb-f16034fd5526
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727033.0
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2010-07-07 00:00:00 UTC
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These Overlooked Blue Chips Offer Shelter in the Storm
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DELL
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https://www.nasdaq.com/articles/these-overlooked-blue-chips-offer-shelter-storm-2010-07-07
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nan
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nan
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It's getting tough out there. On any given day, the market seems to drop right out of the gate, or instead start off strong only to slump later in the day. The net result: when the closing bell rings, stock of all stripes steadily march lower.
In times like these, capital preservation becomes a real concern. You want exposure to stocks when the next rally comes, but you also want to sleep at night.
Where to find stocks that can weather the storm? Well, we've run a list of large cap stocks that have slumped enough to see their P/E rates fall by a solid amount, even though they are still on the up leg of the earnings cycle.
As you'll note in the table above, several of these stocks -- especially the oil-and-gas plays, now offer juicy dividend yields. Royal Dutch Shell's (NYSE: RDS ) 5% dividend yield likely looked impressive in early May when its shares were touching a 52-week high. But the recent slump in its shares has pushed the yield up to an even more impressive 7.0% yield.
You know it's tough out there when venerable Honda Motor (NYSE: HMC ) is trading at just 10 times next year's profits. This is a company that has experienced flawless sales execution, has a sterling reputation with consumers, and is well-prepared to handle increasingly stringent efficiency and emissions regulations. As we've also discussed, investors are running as fast as they can from tech stocks. Dell (Nasdaq: DELL ) is hitting another fresh low this week, and now trades for just eight times projected 2011 profits. (That's closer to a P/E ratio of six when the company's hefty cash balance is excluded).
A Diversified Industrialist gets Marked Down
Most of the stocks on this list have their fortunes tied to one industry in particular. But Johnson Controls (NYSE: JCI ) can boast of solid diversity among its customer base. JCI makes batteries, auto parts, heating/ventilation/AC ( HVAC ) systems and other products. It's also increasingly seen as a "green play" because its HVAC division has secured a wide range of new contracts to retrofit existing buildings in order to become as energy efficient as possible. That's now a $12 billion business for the company.
It's easy to see the appeal of this business: In general, the payback period for saving electricity is much quicker than for investing in alternative energy generation. Typically, the costs associated with reducing electricity usage are recovered within three to four years; whereas the payback period for a solar or wind plant is more typically seven to eight years.
JCI's battery division also has a green sheen. Its new lithium ion batteries (developed in conjunction with partner Saft) should become a key supplier to the nascent electric and hybrid vehicle markets.
Of course, the company still makes money on legacy products. For example, JCI's traditional car battery business controls roughly one-third of the market for after-market batteries. That's a nice recurring business, as a typical car will go through at least three to four batteries in its lifetime. Johnson also makes a range of other auto interior products such as seats, door panels and electronics.
But the most important thing to know about Johnson Controls can't be found among its customers or its products. Instead, it is the company's cost structure, which has shed so much weight in recent years that the company is considered to be the leanest in its field. During the past two years, the company has closed 31 plants, pared its workforce by about -12% and can still make a profit, even if the economy slumps again.
Analysts think JCI can generate roughly $34 billion in sales this year, up a solid +19% from last year, but still about $4 billion below fiscal (September) 2008 levels. Once the economy gets back on its feet and sales move back toward the $40 billion mark, those cots cuts should yield record profits.
Action to Take --> Johnson Controls has typically traded for between seven and 20 times forward earnings. Right now, the forward multiple is much closer to the low end of that range. Assuming shares trade up to the mid-point of that range, or 13 times projected earnings, and if the fiscal 2011 EPS forecast of $2.42 is to be believed, then shares should rise back up to the upper $30s. That's +50% above current levels. When sales claw back to the $40 billion mark, perhaps in fiscal 2012, per share profits should exceed $3. Not bad for a $26 stock.
-- David Sterman
David Sterman has worked as an investment analyst for nearly two decades. Most recently, he served as Managing Editor of RealMoney.com, the premium website of TheStreet.com. David has made numerous media appearances over the years, primarily on CNBC and Bloomberg TV, and has a master's degree in management from Georgia Tech. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold positions in any securities mentioned in this article.
StreetAuthority
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Dell (Nasdaq: DELL ) is hitting another fresh low this week, and now trades for just eight times projected 2011 profits. This is a company that has experienced flawless sales execution, has a sterling reputation with consumers, and is well-prepared to handle increasingly stringent efficiency and emissions regulations. It's also increasingly seen as a "green play" because its HVAC division has secured a wide range of new contracts to retrofit existing buildings in order to become as energy efficient as possible.
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Dell (Nasdaq: DELL ) is hitting another fresh low this week, and now trades for just eight times projected 2011 profits. For example, JCI's traditional car battery business controls roughly one-third of the market for after-market batteries. Analysts think JCI can generate roughly $34 billion in sales this year, up a solid +19% from last year, but still about $4 billion below fiscal (September) 2008 levels.
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Dell (Nasdaq: DELL ) is hitting another fresh low this week, and now trades for just eight times projected 2011 profits. During the past two years, the company has closed 31 plants, pared its workforce by about -12% and can still make a profit, even if the economy slumps again. Analysts think JCI can generate roughly $34 billion in sales this year, up a solid +19% from last year, but still about $4 billion below fiscal (September) 2008 levels.
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Dell (Nasdaq: DELL ) is hitting another fresh low this week, and now trades for just eight times projected 2011 profits. But the recent slump in its shares has pushed the yield up to an even more impressive 7.0% yield. That's now a $12 billion business for the company.
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48f6b545-b929-44f1-97cd-8e1fa16afdd6
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727034.0
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2010-07-07 00:00:00 UTC
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Dell Inc. (NASDAQ:DELL) put sale plays volatility
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DELL
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https://www.nasdaq.com/articles/dell-inc-nasdaqdell-put-sale-plays-volatility-2010-07-07
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nan
|
nan
|
Dell Inc. (NASDAQ: DELL ) shares are on the rise during Wednesday's trading session and outperforming the broad-market gains. Trading action on the tape suggests at least one investor expects the stock to maintain its current level, or not drop significantly, during the longer term.
Shares of the computer maker were trading up more than 2%, or 28 cents, to $12.18 as of 12:50 p.m. EST. The stock is just 3% off its 52-week low of $11.72, and put volume that has crossed so far on the day suggests an investor expects limited downside until February options expiration. DELL has not announced any notable news since its acquisition of software provider Scalent on July 1, and the market expects its next earnings announcement around Aug. 19.
At 11:28 a.m .EST, a block of 4,000 out-of-the-money (OTM) February 10 puts changed hands for 76 cents per contract, the bid price at the time of the trade. These OTM puts are home to current open interest of 95 contracts. This options action suggests the investor collected 76 cents per contract, or a total of $304,000 for the entire lot, to open these short put positions to call for DELL shares to be trading higher than $9.24 at February options expiration. Maximum profit on this short put trade is the credit collected, while maximum loss is limited to $9.24 in the unlikely event that DELL is trading at zero at expiration (the investor loses money in direct relation to the decline in stock price). If DELL shares are trading between the strike price and the breakeven price, the investor keeps some of the premium collected.
While this options action suggests an investor is expressing moderate bullishness on DELL, a closer look at time and sales indicates the investor tied this short put position to a short stock position, and collected $12.18 for 250,000 shares. This stock action translates to the number of shares market makers would have to buy to make this a delta-neutral play. The 76-cent premium for the puts with the stock price at $12.18 equals an implied volatility of 47% compared to the stock's 30-day historical volatility of roughly 40%. If this investor thinks that DELL shares will become less volatile, the selling the 10-strike puts on an implied volatility of 47% will make money for this investor if the position is hedged until expiration.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell Inc. (NASDAQ: DELL ) shares are on the rise during Wednesday's trading session and outperforming the broad-market gains. DELL has not announced any notable news since its acquisition of software provider Scalent on July 1, and the market expects its next earnings announcement around Aug. 19. This options action suggests the investor collected 76 cents per contract, or a total of $304,000 for the entire lot, to open these short put positions to call for DELL shares to be trading higher than $9.24 at February options expiration.
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This options action suggests the investor collected 76 cents per contract, or a total of $304,000 for the entire lot, to open these short put positions to call for DELL shares to be trading higher than $9.24 at February options expiration. While this options action suggests an investor is expressing moderate bullishness on DELL, a closer look at time and sales indicates the investor tied this short put position to a short stock position, and collected $12.18 for 250,000 shares. Dell Inc. (NASDAQ: DELL ) shares are on the rise during Wednesday's trading session and outperforming the broad-market gains.
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This options action suggests the investor collected 76 cents per contract, or a total of $304,000 for the entire lot, to open these short put positions to call for DELL shares to be trading higher than $9.24 at February options expiration. Maximum profit on this short put trade is the credit collected, while maximum loss is limited to $9.24 in the unlikely event that DELL is trading at zero at expiration (the investor loses money in direct relation to the decline in stock price). While this options action suggests an investor is expressing moderate bullishness on DELL, a closer look at time and sales indicates the investor tied this short put position to a short stock position, and collected $12.18 for 250,000 shares.
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This options action suggests the investor collected 76 cents per contract, or a total of $304,000 for the entire lot, to open these short put positions to call for DELL shares to be trading higher than $9.24 at February options expiration. If DELL shares are trading between the strike price and the breakeven price, the investor keeps some of the premium collected. Dell Inc. (NASDAQ: DELL ) shares are on the rise during Wednesday's trading session and outperforming the broad-market gains.
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dd30decb-0d19-44a6-bcd5-404ecb2fde2e
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727035.0
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2010-07-02 00:00:00 UTC
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Opening View: DJIA, SPX Poised for Another Sell-Off as Jobs Data Looms
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DELL
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https://www.nasdaq.com/articles/opening-view-djia-spx-poised-another-sell-jobs-data-looms-2010-07-02
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nan
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nan
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The Dow Jones Industrial Average ( DJIA ) logged its sixth losing session in a row on Thursday, shedding 41 points on the session. The DJIA managed to stem an early sell-off that sent the blue-chip barometer below its October 2009 lows, closing above short-term support at the 9,700 level in the process. Elsewhere, the S&P 500 Index came within about 10 points of the 1,000 level yesterday. And, while the SPX bounced back from its intraday low, the index still closed at its lowest point since October 2, 2009. Doomsayers are already banging the drums on the SPX, as its 50-day and 200-day moving averages are close to forming a "death cross" - i.e. the short-term trendline crosses below the long-term trendline. Such technical formations often occur near periods of heavy market selling, but I would argue that by the time a "death cross" forms, most of Wall Street has already prepared for and digested the development. As for the open, futures on the DJIA and SPX are trading 11.5 points and 1 point below fair value, respectively. Remember to keep a close eye out for today's nonfarm payrolls and unemployment reports. Disappointing data on the jobs front could spark another round of heavy selling heading into a three-day weekend.
Equity news is pretty thin this morning. In the utilities sector, AES Corp. ( AES ) is buying a 1,246 megawatt power plant in Northern Ireland from BG Group for $150 million, according to BG. Ballylumford power station is the largest electricity generation site on the island of Ireland, BG said.
Elsewhere, Dell Inc. ( DELL ) announced that it is buying privately held Scalent. Scalent specializes in making data center infrastructures more efficient. Dell plans to integrate the firm's technology into its advanced infrastructure manager solution. Dell did not disclose any details on the deal.
Finally, Google Inc. ( GOOG ) said that it is buying ITA Software Inc., a flight information software company, for about $700 million in cash. Google believes that the deal will allow it to provide better search information for flights.
Earnings Preview
There are no earning reports scheduled for release today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
We round out the week today with the much anticipated nonfarm payrolls report and the unemployment rate for June. Looking ahead, next week is rather barren. The market is closed Monday for the July 4 holiday, while the June Institute for Supply Management's services index will arrive on Tuesday. Wednesday offers up the weekly report on U.S. petroleum supplies, and Thursday brings the weekly report on U.S jobless claims and May's consumer credit report. Finally, we round out the week with May's wholesale inventories.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,278,686 call contracts traded on Thursday, compared to 971,330 put contracts. The resultant single-session put/call ratio arrived at 0.76, while the 21-day moving average held at 0.66.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
Overseas Trading
Overseas trading looks a bit healthier this morning, as seven of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective, however, rests at a gain of only 0.10%. In Asia, the major indexes closed mixed, with some markets turning around following several consecutive sessions of downward trading. But the mood was cautious after weak U.S. economic data and signs of a slowdown in China fanned fears about the global recovery. European shares rose, bouncing back from three days of losses, with miners higher after Australia dumped its proposed "super profits" tax on the sector for a lower resource rent tax. Overseas market information comes to you courtesy of Schaeffer's Daily Bulletin .
Currencies and Commodities
The U.S. dollar is headed lower once again this morning, as currency traders retreat ahead of key economic data. At last check, the U.S. Dollar Index was off 0.22% at 84.53 in pre-market trading. Elsewhere, commodities are trading in a tight range ahead of the U.S. jobs report. Crude futures are trading essentially flat, with the lead contract off 2 cents at $72.93 per barrel. Meanwhile, gold futures are up $5.50 at $1,212.20 an ounce in London.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Click here for the new spring issue of SENTIMENT magazine
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Elsewhere, Dell Inc. ( DELL ) announced that it is buying privately held Scalent. Dell plans to integrate the firm's technology into its advanced infrastructure manager solution. Dell did not disclose any details on the deal.
|
Elsewhere, Dell Inc. ( DELL ) announced that it is buying privately held Scalent. Dell plans to integrate the firm's technology into its advanced infrastructure manager solution. Dell did not disclose any details on the deal.
|
Elsewhere, Dell Inc. ( DELL ) announced that it is buying privately held Scalent. Dell plans to integrate the firm's technology into its advanced infrastructure manager solution. Dell did not disclose any details on the deal.
|
Elsewhere, Dell Inc. ( DELL ) announced that it is buying privately held Scalent. Dell plans to integrate the firm's technology into its advanced infrastructure manager solution. Dell did not disclose any details on the deal.
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ec22ffce-e387-44c5-bc5e-f8d11c7a634f
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727036.0
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2010-06-28 00:00:00 UTC
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Dell (DELL) investor boosts LEAPS puts volume
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DELL
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https://www.nasdaq.com/articles/dell-dell-investor-boosts-leaps-puts-volume-2010-06-28
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nan
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nan
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Last week, Dell (NASDAQ: DELL ) shares slid by more than 7% thanks to the company giving an outlook that Wall Street did not find too appealing. However, without any notable news on DELL today, at least one investor took the opportunity to boost put volume and collected premium on a moderately bullish play using the January 2012 options.
Dell shares climbed seven cents to $13 during midday trading, and are slightly outperforming the broader market so far on the day. Put volume is active in the January 2012 expiration month thanks to an investor who collected some premium for bull put spreads.
At 10:47 a.m. EST, 5,000 January 2012 12.5/10 bull put spreads changed hands for a net credit of 96 cents per spread. The January 10 puts crossed the tape for $1.36 cents per contract and were bought to open while the 12.50 puts changed hands for $2.32 per contract and were sold to open. This options action indicates the investor will make a maximum profit of the premium collected, or 96 cents per spread, if DELL shares are trading higher than $12.50 at January 2012 options expiration. If DELL shares are trading lower than the breakeven price of $11.54, this investor gives back the credit collected and could continue to lose money as DELL shares move down to $10.The maximum loss is capped at $1.54 if the shares are trading below $10.
A closer look at time and sales shows this investor sold the put spread and traded stock simultaneously, which turns this directional options bet into a delta-neutral volatility play. Around the same time that the options hit the tape, a block of 70,000 DELL shares changed hands for $13. It looks like the investor was more interested in betting on volatility instead of necessarily calling for limited downside during the next year and a half. This stock action translates to the number of shares market makers would have to sell to make this a delta neutral play. The 96-cent premium of the put spread with the stock trading around $13 equates to an implied volatility level of 47% in the 10-strike puts and 42% in the 12.50-strike puts. These implied volatility levels compare to the stock's three-month historical volatility of 38%. If this investor thinks that DELL will become less volatile, then collecting premium on an implied volatility of around 42% will make money for the investor if they are hedged daily until expiration.
The graph below illustrates the profit/loss profile of this bull put spread tied to a stock position. You can build your own visuals by opening a free virtual trading account today - I use the trading tools available to account holders each day to assess and manage risk in stock and option trades.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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However, without any notable news on DELL today, at least one investor took the opportunity to boost put volume and collected premium on a moderately bullish play using the January 2012 options. Last week, Dell (NASDAQ: DELL ) shares slid by more than 7% thanks to the company giving an outlook that Wall Street did not find too appealing. Dell shares climbed seven cents to $13 during midday trading, and are slightly outperforming the broader market so far on the day.
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This options action indicates the investor will make a maximum profit of the premium collected, or 96 cents per spread, if DELL shares are trading higher than $12.50 at January 2012 options expiration. Last week, Dell (NASDAQ: DELL ) shares slid by more than 7% thanks to the company giving an outlook that Wall Street did not find too appealing. However, without any notable news on DELL today, at least one investor took the opportunity to boost put volume and collected premium on a moderately bullish play using the January 2012 options.
|
This options action indicates the investor will make a maximum profit of the premium collected, or 96 cents per spread, if DELL shares are trading higher than $12.50 at January 2012 options expiration. If DELL shares are trading lower than the breakeven price of $11.54, this investor gives back the credit collected and could continue to lose money as DELL shares move down to $10.The maximum loss is capped at $1.54 if the shares are trading below $10. Last week, Dell (NASDAQ: DELL ) shares slid by more than 7% thanks to the company giving an outlook that Wall Street did not find too appealing.
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This options action indicates the investor will make a maximum profit of the premium collected, or 96 cents per spread, if DELL shares are trading higher than $12.50 at January 2012 options expiration. If this investor thinks that DELL will become less volatile, then collecting premium on an implied volatility of around 42% will make money for the investor if they are hedged daily until expiration. Last week, Dell (NASDAQ: DELL ) shares slid by more than 7% thanks to the company giving an outlook that Wall Street did not find too appealing.
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17988bb0-77da-4fa0-aabd-c1ebcddc7792
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727037.0
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2010-06-22 00:00:00 UTC
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Dell hints at leaving Windows for Chrome
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DELL
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https://www.nasdaq.com/articles/dell-hints-leaving-windows-chrome-2010-06-22
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nan
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nan
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Amit Midha, a senior Dell ( DELL ) executive, told Reuters that the company was speaking to Google ( GOOG ) about possibly employing its Chrome operating system on Dell laptops, tablets and smartphones. If Dell follows through on these hints, it would represent a landmark move away from Microsoft's ( MSFT ) Windows OS that has dominated the operating system market for decades.
Dell is the second-largest computer manufacturer in the U.S. by market share behind Hewlett-Packard ( HPQ ), and a shift from the Windows OS to the upcoming Chrome OS could upend expectations about how the future of computing will evolve.
Lately, Apple ( AAPL ), Google and Microsoft have found themselves in an uneasy triangulation as computing moves from the desktop age to the laptop age and on into the mobile smartphone age. Microsoft lags behind both Google and Apple in the mobile phone market, with Windows Phone a distant runner-up to Android and iPhone OS.
Traditional rivalries like the one between Microsoft and Apple have eroded, as both perceive upstart Google as a threat to their model of software. For instance, the latest update to the iPhone includes Microsoft's Bing search engine, although popularity dictates that Google remains the default choice.
"With Chrome or Android or anything like that we want to be one of the leaders," said Midha in an interview with Reuters.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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If Dell follows through on these hints, it would represent a landmark move away from Microsoft's ( MSFT ) Windows OS that has dominated the operating system market for decades. Amit Midha, a senior Dell ( DELL ) executive, told Reuters that the company was speaking to Google ( GOOG ) about possibly employing its Chrome operating system on Dell laptops, tablets and smartphones. Dell is the second-largest computer manufacturer in the U.S. by market share behind Hewlett-Packard ( HPQ ), and a shift from the Windows OS to the upcoming Chrome OS could upend expectations about how the future of computing will evolve.
|
Amit Midha, a senior Dell ( DELL ) executive, told Reuters that the company was speaking to Google ( GOOG ) about possibly employing its Chrome operating system on Dell laptops, tablets and smartphones. If Dell follows through on these hints, it would represent a landmark move away from Microsoft's ( MSFT ) Windows OS that has dominated the operating system market for decades. Dell is the second-largest computer manufacturer in the U.S. by market share behind Hewlett-Packard ( HPQ ), and a shift from the Windows OS to the upcoming Chrome OS could upend expectations about how the future of computing will evolve.
|
Amit Midha, a senior Dell ( DELL ) executive, told Reuters that the company was speaking to Google ( GOOG ) about possibly employing its Chrome operating system on Dell laptops, tablets and smartphones. If Dell follows through on these hints, it would represent a landmark move away from Microsoft's ( MSFT ) Windows OS that has dominated the operating system market for decades. Dell is the second-largest computer manufacturer in the U.S. by market share behind Hewlett-Packard ( HPQ ), and a shift from the Windows OS to the upcoming Chrome OS could upend expectations about how the future of computing will evolve.
|
Amit Midha, a senior Dell ( DELL ) executive, told Reuters that the company was speaking to Google ( GOOG ) about possibly employing its Chrome operating system on Dell laptops, tablets and smartphones. If Dell follows through on these hints, it would represent a landmark move away from Microsoft's ( MSFT ) Windows OS that has dominated the operating system market for decades. Dell is the second-largest computer manufacturer in the U.S. by market share behind Hewlett-Packard ( HPQ ), and a shift from the Windows OS to the upcoming Chrome OS could upend expectations about how the future of computing will evolve.
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cdf28f57-3990-4e73-8e74-5febc6c38bf1
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727038.0
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2010-06-17 00:00:00 UTC
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Dell gambles on gaming in the cloud
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DELL
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https://www.nasdaq.com/articles/dell-gambles-gaming-cloud-2010-06-17
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nan
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nan
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Dell, Inc. ( DELL ) is placing a wager that video games will follow word processing, spreadsheets, video, music and basically everything else onto the ever-growing "cloud" of web-hosted applications. Although networked gaming has existed for years, games still require users to buy a physical disc or download a virtual copy to play.
On June 17, however, OnLive will go online and offer 23 different games streaming across the internet from the company's servers. According to the British technology website The Register , Dell will be providing the server infrastructure, which has been specially engineered to OnLive's specifications.
Currently, video games utilize servers to host online matches, from Halo and Call of Duty's heavily armed death-matches to Activision Blizzard's ( ATVI ) epic and infamous World of Warcraft. In each of these cases, however, each player buys their own copy of the game and logs on from their own PC or console.
OnLive essentially wants to mimic Google's ( GOOG ) success with Google Documents, although obviously they will charge a subscription fee. If the service takes off, Dell could have a massive revenue stream supplying all the hardware necessary to pipe terabytes of game data from OnLive's networks to consumers.
It remains to be seen if gamers are willing to embrace the subscription model which has been so wildly successful with Netflix ( NFLX ), but if they do, OnLive's innovation could help Dell break into a gaming industry from its current location on the periphery.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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If the service takes off, Dell could have a massive revenue stream supplying all the hardware necessary to pipe terabytes of game data from OnLive's networks to consumers. It remains to be seen if gamers are willing to embrace the subscription model which has been so wildly successful with Netflix ( NFLX ), but if they do, OnLive's innovation could help Dell break into a gaming industry from its current location on the periphery. Dell, Inc. ( DELL ) is placing a wager that video games will follow word processing, spreadsheets, video, music and basically everything else onto the ever-growing "cloud" of web-hosted applications.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Dell, Inc. ( DELL ) is placing a wager that video games will follow word processing, spreadsheets, video, music and basically everything else onto the ever-growing "cloud" of web-hosted applications. According to the British technology website The Register , Dell will be providing the server infrastructure, which has been specially engineered to OnLive's specifications.
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Dell, Inc. ( DELL ) is placing a wager that video games will follow word processing, spreadsheets, video, music and basically everything else onto the ever-growing "cloud" of web-hosted applications. If the service takes off, Dell could have a massive revenue stream supplying all the hardware necessary to pipe terabytes of game data from OnLive's networks to consumers. It remains to be seen if gamers are willing to embrace the subscription model which has been so wildly successful with Netflix ( NFLX ), but if they do, OnLive's innovation could help Dell break into a gaming industry from its current location on the periphery.
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Dell, Inc. ( DELL ) is placing a wager that video games will follow word processing, spreadsheets, video, music and basically everything else onto the ever-growing "cloud" of web-hosted applications. According to the British technology website The Register , Dell will be providing the server infrastructure, which has been specially engineered to OnLive's specifications. If the service takes off, Dell could have a massive revenue stream supplying all the hardware necessary to pipe terabytes of game data from OnLive's networks to consumers.
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25109222-12b0-4ab5-b727-c049454e3377
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727039.0
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2010-06-14 00:00:00 UTC
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Profiting From the iPhone Clones
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DELL
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https://www.nasdaq.com/articles/profiting-iphone-clones-2010-06-14
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nan
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nan
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One of the challenges of buying an industry leader such as Apple (Nasdaq: AAPL) is that it is "priced to perfection." The value of its stock implies that the company will fulfill all of the high expectations placed upon it. More than likely, Apple will keep on delivering winning products, but that would be a surprise to almost no one. So it's hard to see how any more good news is not yet built into the stock. For example, few expect shares to gain a major boost when the next iPhone is released on June 24. Its success is already expected.
But what about Apple's rivals, who have sat idly by and missed out on the technology revolution that Apple has pioneered? Few expect these rivals to get a major slice of mobile device market, so they are "priced to imperfection." Yet as we saw with Nokia ( NOK ) a decade ago, and Motorola ( MOT ) five years ago, these lagging rivals can sometimes get it right, and when they do, shares can zoom ahead.
With that in mind, here's a look at what these firms are cooking up, and how you can invest in the space.
Dell (Nasdaq: DELL)
Dell is among a number of companies that have announced plans to come up with a rival for either the iPhone or the iPad. In Dell's case the company is going after both markets by offering a product that slots somewhere in between. The company's Streak is already selling in the United Kingdom, and will be launched in the United States later this summer. By Labor Day, we'll know if consumers see the product as the best of both worlds or the worst of both worlds. It's about 30% smaller than an iPad, which makes it difficult to use as an electronic reader, and with a 5.25-inch screen, it may be too big to use as a daily cellphone. Then again, it'll be easier to lug around than an iPad. And you can use it make calls.
Of course, the success or failure of such a device depends on how many apps it can run. If Dell were to try to build a base of apps from scratch, it would never catch up to Apple. Wisely, the device runs on Google's (Nasdaq: GOOG) Android operating system, which is becoming more popular by the month with app developers. A range of hardware vendors are coalescing behind Android, increasing the odds that it will end up creating a pool of apps -- and users -- to rival the massive iPad/iPhone community.
For Dell, the Streak is unlikely to be a game changer even if successful, because it will still represent a fraction of its overall hardware business. But the device could serve as a halo product for the rest of Dell's offerings, making the company relevant once again in the consumer space.
Dell's positioning among businesses remains fairly strong. The company's line of high-end PCs, servers, storage devices, and other enterprise-focused wares may not have shown much growth in recent years, but is still a massive cash generator. Dell generated about $3 billion in operating income in calendar 2009, and the current year is already off to a good start. If companies start to more aggressively invest in the latest Windows operating system, then cash flow should approach $4 billion by next year. The new Streak, to the extent that it energizes the consumer business, could push cash flow up another +20% by 2012 or 2013. And that would lead to Dell once again being seen as a growth stock, and finally start to generate a price-to-earnings ratio (P/E) closer to high-flying Apple.
Right now, shares of Dell trade for around nine times fiscal (January) 2012 profits. And the multiple is well lower when Dell's $5 billion growing cash pile is excluded. In contrast, Apple's P/E multiple is around 20 (on a fiscal year that ends four months earlier. Here again the multiple is lower when cash is excluded). If Dell could simply justify a forward P/E ratio closer to 12 or 13, then investors would be looking at a +30% to +40% gain.
Motorola ( MOT )
The Motorola RAZR was an immediate sensation when launched, pushing shares north of $25 in 2006. These days, shares are off nearly -75% from that peak, as it's been a long time since Motorola led the mobile device market. Motorola is trying to regain some buzz, and its recent Android-based phones are selling fairly well and carrying impressive gross margins. But Motorola has yet to show its hand in the iPhone/iPad market. Rumors abound that it will unveil an iPad-like device later this year, but it's unclear if the company has any brand loyalty left with consumers.
Motorola has plans to spin off its mobile devices unit, and management has expressed hopes of creating some buzz for the division prior to any spin-off. In the meantime, shares mark time in the $7 range, 15% to 25% below where analysts expect the stock to land once the spinoff plans come into sharper focus. Shares have probably found a floor in the current range, and any new iPad-like device might help to give a short-term boost, though it's worth noting that Dell's announcement of the Streak failed to move shares much higher. As of now, investors remain convinced that Apple has sewn up this market lock, stock and barrel.
Nokia ( NOK )
Once-mighty Nokia has been a real disappointment for its backers, with its U.S. market share rapidly shrinking and its European market share in steady decline. Make no mistake, the company has an impressively broad array of mobile devices, is still a powerful brand name across Asia, Latin America and Africa, and has strong relationships with many wireless carriers. But the company made a mistake by sticking with an operating system known as Symbian, while Apple and Google's software has proven to be far more robust. The odds of a rich community of applications developers coalescing around Symbian hover between slim and none.
Nokia has emerged as a low-cost producer, which allows it to offer very inexpensive phones in price-sensitive markets, but the company seemingly chose to focus on the wrong end of the market. Ten years ago, Nokia dwarfed Apple in terms of market value . By developing sophisticated products with very consumer-friendly software, Apple has generated so much buzz that it now has a market value seven times that of Nokia.
In recent quarters, Nokia's management has poured more resources into R&D, vowing to once again become relevant in the smartphone market. You can't count them out. As this analysis has shown, every dog has its day in this market. But it is hard to see how Apple will lose its way at this point. Instead, investors should focus on which of the companies can show some momentum. They've all done it before.
Action to Take --> Shares of Apple are quite pricey compared with the rest of these firms, by a range of valuation metrics. Dell, Motorola and Nokia all have real attributes, and not many supporters. Rather than try to pick a winner among the group, investors may want to spread the wealth around, building small positions in all three. Even if only one of them develops a hot product to rival the iPad/iPhone, the value of the basket of stocks would rise smartly. And if none of these stocks makes a major splash, shares are still likely to find support thanks to strong balance sheets and strong cash flow generation.
-- David Sterman
Staff Writer
StreetAuthority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell (Nasdaq: DELL) Dell is among a number of companies that have announced plans to come up with a rival for either the iPhone or the iPad. In Dell's case the company is going after both markets by offering a product that slots somewhere in between. If Dell were to try to build a base of apps from scratch, it would never catch up to Apple.
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Dell's positioning among businesses remains fairly strong. Dell (Nasdaq: DELL) Dell is among a number of companies that have announced plans to come up with a rival for either the iPhone or the iPad. In Dell's case the company is going after both markets by offering a product that slots somewhere in between.
|
Dell (Nasdaq: DELL) Dell is among a number of companies that have announced plans to come up with a rival for either the iPhone or the iPad. But the device could serve as a halo product for the rest of Dell's offerings, making the company relevant once again in the consumer space. In Dell's case the company is going after both markets by offering a product that slots somewhere in between.
|
Dell (Nasdaq: DELL) Dell is among a number of companies that have announced plans to come up with a rival for either the iPhone or the iPad. But the device could serve as a halo product for the rest of Dell's offerings, making the company relevant once again in the consumer space. In Dell's case the company is going after both markets by offering a product that slots somewhere in between.
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5e3b16c5-207d-4b05-92fa-8dbc2046b278
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727040.0
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2010-06-11 00:00:00 UTC
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Opening View: SPX Looking Up At 1,100 Again; Can DJIA Maintain Momentum?
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DELL
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https://www.nasdaq.com/articles/opening-view-spx-looking-1100-again-can-djia-maintain-momentum-2010-06-11
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nan
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nan
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Traders are hoping to finish the week on the right foot this morning and keep up Thursday's positive momentum, which saw the Dow Jones Industrial Average log its third strongest session of 2010. By the end of trading, the Dow had added 273 points and reclaimed both its 20-day moving average and the 10,000 level. Nonetheless, the S&P 500 Index ( SPX ) is still looking up at potentially stiff resistance at the 1,100 leve1. The CBOE Market Volatility Index, meanwhile, is sitting right at the round-number 30 level following Thursday's nearly 10% decline. Looking ahead to today, traders will be focused on the release of May retail sales, business inventories, and the preliminary consumer sentiment report from the University of Michigan. Overseas trading is holding strong this morning, although U.S. index futures indicate a relatively flat open.
Dell Inc. ( DELL ) revised its first-quarter earnings to 17 cents a share, from 22 cents, due to $100 million in liability that it has to record in relation to a Securities and Exchange Commission investigation, the computer giant said Thursday. The revised figure was provided in a regulatory filing submitted to explain why Dell was unable to file its 10-Q for the first quarter by June 9.
National Semiconductor ( NSM ) reported fiscal fourth-quarter income of $79.2 million, or 33 cents a share, compared with a loss of $63.7 million, or 28 cents a share, in the year-earlier period. Revenue was $398.5 million, up from $280.8 million. Analysts had expected the chip company to report earnings of 28 cents a share, on revenue of $384.4 million.
Earnings Preview
On the earnings front, there are no major reports slated for release today. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
The economic calendar finishes the week with May retail sales, the preliminary University of Michigan consumer sentiment report, and April business inventories. Looking ahead to next week, Monday has no reports scheduled, while Tuesday brings the release of the Empire State Manufacturing Index for June along with import/export data. Wednesday brings the release of weekly crude inventories, May housing starts, the May Producer Price Index ( PPI ) and core PPI, and May industrial production data. Thursday will be chock full of economic data. Traders will get a look at initial jobless claims, the May Consumer Price Index ( CPI ) and core CPI, the Conference Board's leading indicators index for May, and the Philadelphia Fed Index for June. There are no major economic reports next Friday.
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,221,362 call contracts traded on Thursday, compared to 809.936 put contracts. The resultant single-session put/call ratio arrived at 0.66, while the 21-day moving average came in at 0.66.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
Overseas Trading
Overseas trading is strong this morning, as all 10 markets that we follow are in positive territory. The cumulative average return on the group stands at a gain of 1.17%. Stocks rallied in both Asia and Europe on optimism over global growth. BP recovered on hopes its dividend might be deferred rather than cut. Overseas market information comes to you courtesy of Schaeffer's Daily Bulletin .
Currencies and Commodities
The U.S. dollar is down slightly this morning as the euro gains ground on hopes of a strengthening global economy. The U.S. Dollar Index is down 0.05% in pre-market trading. Elsewhere, crude futures are down in electronic trading, with the most active contract was losing 58 cents to sit at $74.90 per barrel. Finally, gold has retreated this morning, losing 40 cents to rest at $1,221.80 an ounce in London.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell Inc. ( DELL ) revised its first-quarter earnings to 17 cents a share, from 22 cents, due to $100 million in liability that it has to record in relation to a Securities and Exchange Commission investigation, the computer giant said Thursday. The revised figure was provided in a regulatory filing submitted to explain why Dell was unable to file its 10-Q for the first quarter by June 9. Traders are hoping to finish the week on the right foot this morning and keep up Thursday's positive momentum, which saw the Dow Jones Industrial Average log its third strongest session of 2010.
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Dell Inc. ( DELL ) revised its first-quarter earnings to 17 cents a share, from 22 cents, due to $100 million in liability that it has to record in relation to a Securities and Exchange Commission investigation, the computer giant said Thursday. The revised figure was provided in a regulatory filing submitted to explain why Dell was unable to file its 10-Q for the first quarter by June 9. Looking ahead to today, traders will be focused on the release of May retail sales, business inventories, and the preliminary consumer sentiment report from the University of Michigan.
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Dell Inc. ( DELL ) revised its first-quarter earnings to 17 cents a share, from 22 cents, due to $100 million in liability that it has to record in relation to a Securities and Exchange Commission investigation, the computer giant said Thursday. The revised figure was provided in a regulatory filing submitted to explain why Dell was unable to file its 10-Q for the first quarter by June 9. Traders will get a look at initial jobless claims, the May Consumer Price Index ( CPI ) and core CPI, the Conference Board's leading indicators index for May, and the Philadelphia Fed Index for June.
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Dell Inc. ( DELL ) revised its first-quarter earnings to 17 cents a share, from 22 cents, due to $100 million in liability that it has to record in relation to a Securities and Exchange Commission investigation, the computer giant said Thursday. The revised figure was provided in a regulatory filing submitted to explain why Dell was unable to file its 10-Q for the first quarter by June 9. Overseas trading is holding strong this morning, although U.S. index futures indicate a relatively flat open.
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faec5d9a-f56b-4cd8-b39b-c5f5e715f547
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727041.0
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2010-06-04 00:00:00 UTC
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Can Going to War With Apple Save this Tech Giant?
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DELL
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https://www.nasdaq.com/articles/can-going-war-apple-save-tech-giant-2010-06-04
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nan
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nan
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Rome wasn't built in a day. That refrain is often employed when management embarks on a turnaround . The problem, though, is that investors may begin to lose their confidence. If they're forced to wait too long, they may lose hope, sell out and force the shares down.
Tech impresario Michael Dell knows that all too well. He has worked for half a decade to turn things around at Dell (Nasdaq: DELL) , and only now has the results to show for it. This tech giant is boosting sales, churning out lots of cash, just announced an intriguing new product and is likely to keep making deals to help boost the top and bottom lines.
Dell's operational rebound is not proceeding at a breakneck pace. Projected fiscal 2010 sales, while up more than +15% over fiscal 2009, only match the sales brought in the prior year, before the global economy cooled. Analysts expect sales to rise just +5% in fiscal 2011 to around $65 billion. But thanks to very tight cost controls, operating margins are expanding, so EPS is rising closer to a +15% to +20% pace. According to analysts, Dell earned about $1.00 a share last year, should earn around $1.25 this year and approach $1.50 in EPS next year. Now that's the turnaround investors have been waiting for.
Yet shares have recently hit a rough patch. Gross margins, which sequentially rose 200 basis points to 17.6% in the most recent quarter, were slightly lower than the 17.7% forecast. Nevertheless, even moderate sales growth could get the gross margin rate back up to 18% later this year and into fiscal 2011. More importantly, operating margins should move back up above 6% next year for the first time since fiscal 2006.
Dell can lean on several factors that could boost sales and profits even higher than the cited forecasts. For starters, the company is sitting on more than $11 billion in gross cash, and management has made it clear that checkbook diplomacy will be part of its growth strategy. (Net cash is closer to $7 billion).
A recent deal to acquire Perot Systems is a fine example. Perot's service-oriented focus carries higher gross margins than Dell's traditional hardware-focused model. Future deals should also focus on margin-boosting opportunities. All that cash is also being used to buy back stock, and with the recent slump in shares, the buyback plan could accelerate from current levels.
As a wildcard, Dell may get back into the game as a purveyor of hot consumer products. The company has developed a competitor to Apple's (Nasdaq: AAPL) iPad, called "the Streak." The product, which has just been released in the United Kingdom, is a bit smaller than the iPad, but can also double as a smartphone. The Streak uses Google's (Nasdaq: GOOG) Android software, which should eventually have enough applications to rival the iPad. The product is slated to go on sale in the United States sometime in July. If the product receives strong reviews and industry buzz, then shares might finally start to move back into favor.
Action to Take ------> Even without this near-term booster, investors should still note the long-term turnaround underway at Dell. A combination of a falling stock price and rising estimates has turned this into a real value play. Shares trade for about 13.5 times this year's profits and 10.5 times next year's profits. Back out that hefty cash balance, and the fiscal 2011 P/E ratio is even less.
Whether it's a reduced share count, growth-boosting acquisitions or a hot new product, Michael Dell aims to see this turnaround through to the end. Although it has been long in coming, investor patience may soon pay off.
-- David Sterman
Staff Writer
StreetAuthority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Whether it's a reduced share count, growth-boosting acquisitions or a hot new product, Michael Dell aims to see this turnaround through to the end. Tech impresario Michael Dell knows that all too well. He has worked for half a decade to turn things around at Dell (Nasdaq: DELL) , and only now has the results to show for it.
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According to analysts, Dell earned about $1.00 a share last year, should earn around $1.25 this year and approach $1.50 in EPS next year. Perot's service-oriented focus carries higher gross margins than Dell's traditional hardware-focused model. Tech impresario Michael Dell knows that all too well.
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According to analysts, Dell earned about $1.00 a share last year, should earn around $1.25 this year and approach $1.50 in EPS next year. Whether it's a reduced share count, growth-boosting acquisitions or a hot new product, Michael Dell aims to see this turnaround through to the end. Tech impresario Michael Dell knows that all too well.
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Tech impresario Michael Dell knows that all too well. He has worked for half a decade to turn things around at Dell (Nasdaq: DELL) , and only now has the results to show for it. Dell's operational rebound is not proceeding at a breakneck pace.
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4d9dbc92-a755-4415-a78e-0d20ad06bedd
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727042.0
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2010-06-01 00:00:00 UTC
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Some Ideas ... and Some Potential Bargains ... To Help You Focus on What Matters
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DELL
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https://www.nasdaq.com/articles/some-ideas-and-some-potential-bargains-help-you-focus-what-matters-2010-06-01
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nan
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nan
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For most investors, the health of the U.S. economy should be the most important item to track. How the economy fares will directly correlate with how the Nasdaq, NYSE and S&P 500 perform -- over the long-term. But right now, attention is focused on many "outside" factors, most of which are more relevant to foreign investors or short-term traders. If you let those factors rattle you, you're likely to move to cash at the wrong time.
To be sure, the recent market weakness can test anyone's mettle. But should we really be surprised at a -10% correction after we saw the S&P 500 move from 700 to 1,200 in just 14 months? That kind of +70% move is virtually unheard of, and should have led to some near-term caution. But the pullback doesn't mean the rally has ended. Indeed, the most important pieces of data are flashing green.
For example, the Institute of Supply Management's ( ISM ) index of factory activity in May has just been released, and the rate of orders held steady from the prior month at 65.7. (Any number above 50 indicates that the factory sector is expanding). In addition, the ISM's employment index expanded last month from 58.5 to 59.8. That means that the monthly jobs report, due out this Friday, is likely to be in line with or above forecasts.
Consumers Getting Stronger
As many headed off for a long holiday weekend on Friday, they may have missed some important data regarding consumer spending. The Commerce Department noted that consumer spending barely rose in April after rising for six months. Bad news, right? Actually, personal income climbed 0.4%, in line with recent monthly gains. That means consumers are looking to bolster their savings and pay off debt. The savings rate rose to 3.6% in April, from 3.1% in March, and could well rise further as consumers remain cautious. After all, the nightly news is in "scare mode" right now. That may crimp spending in the near-term, but should set the stage for stronger consumer balance sheets down the road. If household savings keep growing, and if job creation continues, the economy is very likely to get back on to a path of sustainable growth. It's too early to sound the all-clear on the economy, but the scary headlines out of Europe, the Gulf Coast and the Middle East are decreasingly likely to have a major negative impact going forward.
More than likely, economic growth will not be robust this year, as we're still feeling the after-effects of the global economic malaise of 2008 and 2009. But the trend is positive, and growth should become more inspiring next year and into 2012. And remember that investors look six to 12 months ahead, so the market is likely digesting the tepid growth outlook right now. By this summer, the market should look ahead into 2011, and should like what it sees.
Action to Take --> A wide range of stocks are starting to trade down from their highs, even as the respective earnings outlooks are materially strengthening. Companies that have pared expenses in recent years can continue to show robust profit growth with just modest sales growth. That backdrop fueled a powerful rally in the 1990s as profit margins exceeded previous highs.
Here's just a sampling of companies whose shares have fallen more than -25% from their 52-week highs while also seeing their earnings estimates rise during the past 90 days: Seagate Technology ( STX ) , Integrated Silicon Solutions (Nasdaq: ISSI) , Deer Consumer Products (Nasdaq: DEER) , Electronic Arts (Nasdaq: ERTS) , Dell, Inc. (Nasdaq: DELL) and Denny's (Nasdaq: DENN) .
If you've got cash to put into play, wait for days when the market is sharply trading off. With all the daunting global headlines right now, that's bound to happen soon. Happy hunting.
-- David Sterman
Staff Writer
StreetAuthority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Here's just a sampling of companies whose shares have fallen more than -25% from their 52-week highs while also seeing their earnings estimates rise during the past 90 days: Seagate Technology ( STX ) , Integrated Silicon Solutions (Nasdaq: ISSI) , Deer Consumer Products (Nasdaq: DEER) , Electronic Arts (Nasdaq: ERTS) , Dell, Inc. (Nasdaq: DELL) and Denny's (Nasdaq: DENN) . For example, the Institute of Supply Management's ( ISM ) index of factory activity in May has just been released, and the rate of orders held steady from the prior month at 65.7. It's too early to sound the all-clear on the economy, but the scary headlines out of Europe, the Gulf Coast and the Middle East are decreasingly likely to have a major negative impact going forward.
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Here's just a sampling of companies whose shares have fallen more than -25% from their 52-week highs while also seeing their earnings estimates rise during the past 90 days: Seagate Technology ( STX ) , Integrated Silicon Solutions (Nasdaq: ISSI) , Deer Consumer Products (Nasdaq: DEER) , Electronic Arts (Nasdaq: ERTS) , Dell, Inc. (Nasdaq: DELL) and Denny's (Nasdaq: DENN) . Companies that have pared expenses in recent years can continue to show robust profit growth with just modest sales growth. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. © Copyright 2001-2010 StreetAuthority, LLC.
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Here's just a sampling of companies whose shares have fallen more than -25% from their 52-week highs while also seeing their earnings estimates rise during the past 90 days: Seagate Technology ( STX ) , Integrated Silicon Solutions (Nasdaq: ISSI) , Deer Consumer Products (Nasdaq: DEER) , Electronic Arts (Nasdaq: ERTS) , Dell, Inc. (Nasdaq: DELL) and Denny's (Nasdaq: DENN) . And remember that investors look six to 12 months ahead, so the market is likely digesting the tepid growth outlook right now. Companies that have pared expenses in recent years can continue to show robust profit growth with just modest sales growth.
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Here's just a sampling of companies whose shares have fallen more than -25% from their 52-week highs while also seeing their earnings estimates rise during the past 90 days: Seagate Technology ( STX ) , Integrated Silicon Solutions (Nasdaq: ISSI) , Deer Consumer Products (Nasdaq: DEER) , Electronic Arts (Nasdaq: ERTS) , Dell, Inc. (Nasdaq: DELL) and Denny's (Nasdaq: DENN) . If you let those factors rattle you, you're likely to move to cash at the wrong time. More than likely, economic growth will not be robust this year, as we're still feeling the after-effects of the global economic malaise of 2008 and 2009.
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f18ef2eb-3223-4268-a888-3a2b4b9e74d8
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727043.0
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2010-05-25 00:00:00 UTC
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Stocks to Avoid and Stocks to Take a Look at in this Downturn
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DELL
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https://www.nasdaq.com/articles/stocks-avoid-and-stocks-take-look-downturn-2010-05-25
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nan
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nan
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Absent a bullish press release, virtually every stock is taking it on the chin right now. There is no safe haven in large companies or small ones, value stocks or growth stocks. This is what happens in brutal markets. Buyers go on strike and sellers rule the day. But when the selling pressure abates, savvy investors are quick to rebuild positions in names that didn't deserve such a beating in the first place.
Of course, some companies, sectors and funds have plenty to fear from a possibly growing European contagion. For example, the Russia Market Vectors Exchange-Traded Fund ( RSX ) is off nearly -6% today and is down by more than a third since mid-April. The Russian economy is increasingly tied to European economies, and as the crises of 1998 and 2008 showed, the Russian economy can fall off the rails pretty quickly.
But is there a similar justification for the -25% pummeling taken by the iShares Brazil ETF( EWZ ) in recent weeks? Not at all. Brazil has solid finances, a growing economy and has a much higher exposure to Latin America, which is increasingly becoming a self-sufficient continent, focused more on neighboring economies than on Europe.
Looking at U.S. stocks, investors should be much more concerned about the large cap names, many of which generate 30% or 40% of their sales in Europe. Smaller companies -- those with a market value below $1 billion -- typically lack the muscle to have a large foreign presence. Then again, investors tend to stick with the bigger names in market routs as they offer greater perceived safety. Yet if the market simply becomes stagnant and remains at current levels, investors may start to wade back into the smaller stocks that are primarily focused on the U.S economy. And as a series of government reports are expected to show this week, the U.S. economy is starting to glide back on to a sustainable growth path.
Action to Take --> Stress-test your portfolio, and think about ways to reduce your exposure to Europe. Key exporters such as Caterpillar ( CAT ) , consumer names like Procter & Gamble ( PG ) and large tech names like Microsoft (Nasdaq: MSFT) will all feel the pain if Europe slips back into recession - especially when you consider the stresses on many European banks that are ill-prepared for yet another period of economic contraction. Another concern for these U.S. big caps is their currency exposure. Look for downward revisions to earnings estimates as analysts start to incorporate the impact of a weaker euro.
It's tempting to chase the stocks that have been unfairly tarnished in this rout. But know that stocks can fall further before they rebound, so proceed cautiously. Names on my radar include companies that are more exposed to the healthier U.S. and Asian economies.
They include: Charles Schwab (Nasdaq: SCHW) , Southwest Energy ( SWN ) , American Superconductor (Nasdaq: AMSC) , Assured Guaranty ( AGO ) , Deer Consumer Products (Nasdaq: DEER) , DryShips (Nasdaq: DRYS) , Wendy's ( WEN ) , DirecTV ( DTV ) and Dell (Nasdaq: DELL) . All of these stocks have been pulled south in the market sell-off, but still sport nice growth prospects or rock-bottom valuations.
-- David Sterman
Contributor
StreetAuthority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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They include: Charles Schwab (Nasdaq: SCHW) , Southwest Energy ( SWN ) , American Superconductor (Nasdaq: AMSC) , Assured Guaranty ( AGO ) , Deer Consumer Products (Nasdaq: DEER) , DryShips (Nasdaq: DRYS) , Wendy's ( WEN ) , DirecTV ( DTV ) and Dell (Nasdaq: DELL) . But when the selling pressure abates, savvy investors are quick to rebuild positions in names that didn't deserve such a beating in the first place. Yet if the market simply becomes stagnant and remains at current levels, investors may start to wade back into the smaller stocks that are primarily focused on the U.S economy.
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They include: Charles Schwab (Nasdaq: SCHW) , Southwest Energy ( SWN ) , American Superconductor (Nasdaq: AMSC) , Assured Guaranty ( AGO ) , Deer Consumer Products (Nasdaq: DEER) , DryShips (Nasdaq: DRYS) , Wendy's ( WEN ) , DirecTV ( DTV ) and Dell (Nasdaq: DELL) . The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. © Copyright 2001-2010 StreetAuthority, LLC. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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They include: Charles Schwab (Nasdaq: SCHW) , Southwest Energy ( SWN ) , American Superconductor (Nasdaq: AMSC) , Assured Guaranty ( AGO ) , Deer Consumer Products (Nasdaq: DEER) , DryShips (Nasdaq: DRYS) , Wendy's ( WEN ) , DirecTV ( DTV ) and Dell (Nasdaq: DELL) . The Russian economy is increasingly tied to European economies, and as the crises of 1998 and 2008 showed, the Russian economy can fall off the rails pretty quickly. Yet if the market simply becomes stagnant and remains at current levels, investors may start to wade back into the smaller stocks that are primarily focused on the U.S economy.
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They include: Charles Schwab (Nasdaq: SCHW) , Southwest Energy ( SWN ) , American Superconductor (Nasdaq: AMSC) , Assured Guaranty ( AGO ) , Deer Consumer Products (Nasdaq: DEER) , DryShips (Nasdaq: DRYS) , Wendy's ( WEN ) , DirecTV ( DTV ) and Dell (Nasdaq: DELL) . There is no safe haven in large companies or small ones, value stocks or growth stocks. The Russian economy is increasingly tied to European economies, and as the crises of 1998 and 2008 showed, the Russian economy can fall off the rails pretty quickly.
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32ecf4b0-0474-4b07-8668-abb98b8d9be7
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727044.0
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2010-05-21 00:00:00 UTC
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Friday Losers: Brocade, Dell, Red Robin Gourmet Burgers
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DELL
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https://www.nasdaq.com/articles/friday-losers-brocade-dell-red-robin-gourmet-burgers-2010-05-21
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nan
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nan
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Among the biggest losers in Friday's early trading are Brocade (Nasdaq: BRCD) , Dell (Nasdaq: DELL) and Red Robin Gourmet Burgers (Nasdaq: RRGB) .
Dell Slowly Improves
In early March, shares of Dell (Nasdaq: DELL) started to stage an impressive rally as investors grew to expect a healthy upturn in demand for tech equipment. But in recent weeks, the optimism evaporated on concerns that price pressures would limit profit growth. Dell confirmed that thesis Thursday evening, as profit margins lagged forecasts, pushing shares down nearly -6% in Friday trading. Shares have now come all the way back to where they were before this year's early March rally began.
Part of the weakness is attributable to management's predictions of steady -- but not robust -- growth to come. Management always downplays the forward view and never gives explicit sales or profit guidance, so investors should have never expected a bullish forecast from management to begin with.
Nevertheless, Dell's picture has materially brightened, even if gross margins remain under pressure. It's important to note that overall profits are still growing at healthy clip, as rising sales offset the minor margin compression. Lastly, most corporations have yet to embark on a Windows upgrade cycle, which should begin within the next few quarters, assuming the economy doesn't slip back into recession.
Action to Take --> It's hard to understand why investors are dumping a stock that sells for less than seven times 2011 EBITDA/EV, and whose cash balance is the equivalent of half its market value (when projected fiscal 2011 free cash flow is incorporated into the cash position). Dell is indeed turning around, despite the disappointing stock chart. This stock looks set for a solid rebound once the current round of hand-wringing over tech spending has ended.
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Brocade's Management Loses Trust
Judging by the -13% pummeling its shares received on Friday, you would think Brocade Communications (Nasdaq: BRCD) must have delivered a lousy fiscal second quarter. Actually, the quarter was OK, with a mixed bag of good news (the bottom-line) and bad news (the top line). Instead, the sell-off has everything to do with confidence in management. Only recently, management had spoken of strength in its high-margin Storage Area Network ( SAN ) division. But revenues at the SAN division missed forecasts by around 10%. Conversely, the company's lower-margin Ethernet business performed well ahead of expectations. Those trends are the reverse of just a quarter ago. Investors seem to be feeling that management has a lack of credibility in terms of forecasting and consistent execution.
A quick survey of analysts' reports implies that Brocade's quarterly results weren't all that disappointing when all the factors are taken into account. Several analysts reiterated "Buy" ratings with price targets above $7 a share. Shares now trade for less than 10 times projected fiscal 2010 profits.
Action to Take --> Even though shares are cheap and the sell-off appears overdone, investors should tread very lightly with tech stocks right now as any news -- good or bad -- is being viewed with a gimlet eye. Goldman Sachs's ( GS ) downgrade of Brocade typifies investor sentiment: shares may be cheap, but they lack any near-term catalysts to bring in buyers. Keep this name on your watch list. It could prove to be appealing once tech stocks start to rotate back into favor.
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Red Robin's Struggles Cause Shares to Lose Big
Red Robin Gourmet Burgers' (Nasdaq: RRGB) shares are down nearly -16%. The fast-food chain missed sales estimates by a small margin , and took down full-year guidance. The company actually boosted advertising and promotion efforts in the quarter, and the fact that sales weren't higher is a bad sign. It is possible that if management had not spent heavily to drive store traffic, then the sales shortfall could have been even greater. The higher ad spending also led to a sharper profit shortfall: EPS of $0.14 was roughly half the consensus forecast. (A one-time gain gives the appearance that Red Robin actually exceeded forecasts).
With the exception of McDonald's ( MCD ) , many burger chains have been struggling to boost sales. Many thought they would find more favor among cash-strapped consumers, but those consumers may increasingly be preparing their own meals.
Action to Take --> The bottom line is a much more important factor here than the top line. As long as management needs to keep spending heavily to lure customers, profit margins will remain subpar. Despite today's sharp sell-off, shares are still no bargain at more than 16 times projected 2010 profits. Instead, keep an eye on Wendy's ( WEN ) , trading at new lows for the year on Friday, but better-positioned to generate meaningful profit growth once sales trends reverse.
-- David Sterman
Contributor
StreetAuthority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Among the biggest losers in Friday's early trading are Brocade (Nasdaq: BRCD) , Dell (Nasdaq: DELL) and Red Robin Gourmet Burgers (Nasdaq: RRGB) . Dell Slowly Improves In early March, shares of Dell (Nasdaq: DELL) started to stage an impressive rally as investors grew to expect a healthy upturn in demand for tech equipment. Dell confirmed that thesis Thursday evening, as profit margins lagged forecasts, pushing shares down nearly -6% in Friday trading.
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Among the biggest losers in Friday's early trading are Brocade (Nasdaq: BRCD) , Dell (Nasdaq: DELL) and Red Robin Gourmet Burgers (Nasdaq: RRGB) . Dell Slowly Improves In early March, shares of Dell (Nasdaq: DELL) started to stage an impressive rally as investors grew to expect a healthy upturn in demand for tech equipment. Dell confirmed that thesis Thursday evening, as profit margins lagged forecasts, pushing shares down nearly -6% in Friday trading.
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Among the biggest losers in Friday's early trading are Brocade (Nasdaq: BRCD) , Dell (Nasdaq: DELL) and Red Robin Gourmet Burgers (Nasdaq: RRGB) . Dell Slowly Improves In early March, shares of Dell (Nasdaq: DELL) started to stage an impressive rally as investors grew to expect a healthy upturn in demand for tech equipment. Dell confirmed that thesis Thursday evening, as profit margins lagged forecasts, pushing shares down nearly -6% in Friday trading.
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Among the biggest losers in Friday's early trading are Brocade (Nasdaq: BRCD) , Dell (Nasdaq: DELL) and Red Robin Gourmet Burgers (Nasdaq: RRGB) . Dell Slowly Improves In early March, shares of Dell (Nasdaq: DELL) started to stage an impressive rally as investors grew to expect a healthy upturn in demand for tech equipment. Dell confirmed that thesis Thursday evening, as profit margins lagged forecasts, pushing shares down nearly -6% in Friday trading.
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36a155b0-0710-454e-93a7-c9237906bf63
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727045.0
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2010-05-21 00:00:00 UTC
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Opening View: VIX Soars to 45; DJIA Set to Dip Below 10K
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DELL
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https://www.nasdaq.com/articles/opening-view-vix-soars-45-djia-set-dip-below-10k-2010-05-21
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nan
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nan
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The Dow Jones Industrial Average ( DJIA ) plunged nearly 400 points on Thursday, bringing the blue-chip barometer perilously close to psychological support at the 10,000 level. Unfortunately there is no rest for the weary, as it appears that the DJIA may breach this round-number support level, with futures pointing toward a loss of about 51 points on the open. Meanwhile, S&P 500 Index ( SPX ) futures are indicating an opening loss of more than 7 points. Such a move would put the SPX dangerously close to its February lows near 1,160. Below this, the SPX has little in the way of technical support until 1,030, its November 2009 low. Finally, the CBOE Market Volatility Index ( VIX ) has soared more than 46% so far this week, as the fear index tagged yet another annual high on Thursday. The VIX is now trading north of the 45 level, a region it has not seen since March 2009.
In earnings news, Aeropostale Inc. ( ARO ) is off about 2% in pre-market activity after the company posted first-quarter net income of $45.4 million, or 48 cents per share. Total net sales rose to $463.6 million, while same-store sales rose 8%. Analysts were expecting a profit of 46 cents per share.
Brocade Communications Systems Inc. ( BRCD ) reported a second-quarter profit of $62.7 million, or 13 cents per share, excluding items, as revenue came in at $501 million. Analysts had forecast earnings of 12 cents per share on $503 million in sales. BRCD shares have plummeted nearly 9% in pre-market trading following the report.
Salesforce.com Inc. ( CRM ) shares have dropped about 4.5% in electronic trading after the company reported a first-quarter profit of $17.7 million, or 13 cents a share. Excluding items, the CRM earned 30 cents per share, in line with expectations. Revenue rose 24% to $376.8 million.
Finally, Dell Inc. ( DELL ) is down about 3% in pre-market trading, as investors react to news that the company eared $441 million, or 22 cents per share, in the first quarter. Revenue rose to $14.9 billion. Adjusted income was 30 cents per share, edging past Wall Street's expectations for earnings of 26 cents per share on revenue of $14.3 billion.
Earnings Preview
On the earnings front, AnnTaylor Stores Corp. ( ANN ) and Frontline Ltd. ( FRO ) are slated to release their quarterly earnings reports. Keep your browser at SchaeffersResearch.com for more news as it breaks.
Economic Calendar
GDP
Market Statistics
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,842,471 call contracts traded on Thursday, compared to 1,760,353 put contracts. The resultant single-session put/call ratio arrived at 0.96, while the 21-day moving average rose to 0.63.
**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**
Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.
Overseas Trading
Overseas trading is headed for steep weekly losses, as only one of the 10 foreign indexes that we follow is in positive territory this Friday morning. The cumulative average return on the collective stands at a loss of 1.10%. In Asia, stock markets suffered losses, as persistent worries over the euro zone debt crisis and its negative impact on the global economic recovery sent investors heading for the exits. Turning to Europe, stocks are lower, with heightened concerns over euro zone sovereign debt and government spending and tougher financial industry regulations hurting sentiment. Overseas market information comes to you courtesy of Schaeffer's Daily Bulletin .
Currencies and Commodities
The U.S. Dollar Index pulled back sharply yesterday, as the euro rebounded from multi-year lows. However, the dollar appears to be back on track this morning, with the index up 0.34% at 85.86. The same cannot be said about oil and gold, however. Crude futures are threatening to break below $70 per barrel this morning, with the July contract down 59 cents at $70.21 per barrel. Finally, gold futures are extending their recent losses, dropping $6.20 to $1,182.40 in London.
Unusual Put and Call Activity:
For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .
Due to technical issues, the "Unusual Put and Call Activity" charts are unavailable today. We apologize for the inconvenience.
Click here for the new spring issue of SENTIMENT magazine
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Finally, Dell Inc. ( DELL ) is down about 3% in pre-market trading, as investors react to news that the company eared $441 million, or 22 cents per share, in the first quarter. The Dow Jones Industrial Average ( DJIA ) plunged nearly 400 points on Thursday, bringing the blue-chip barometer perilously close to psychological support at the 10,000 level. In Asia, stock markets suffered losses, as persistent worries over the euro zone debt crisis and its negative impact on the global economic recovery sent investors heading for the exits.
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Finally, Dell Inc. ( DELL ) is down about 3% in pre-market trading, as investors react to news that the company eared $441 million, or 22 cents per share, in the first quarter. In earnings news, Aeropostale Inc. ( ARO ) is off about 2% in pre-market activity after the company posted first-quarter net income of $45.4 million, or 48 cents per share. Salesforce.com Inc. ( CRM ) shares have dropped about 4.5% in electronic trading after the company reported a first-quarter profit of $17.7 million, or 13 cents a share.
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Finally, Dell Inc. ( DELL ) is down about 3% in pre-market trading, as investors react to news that the company eared $441 million, or 22 cents per share, in the first quarter. Salesforce.com Inc. ( CRM ) shares have dropped about 4.5% in electronic trading after the company reported a first-quarter profit of $17.7 million, or 13 cents a share. Adjusted income was 30 cents per share, edging past Wall Street's expectations for earnings of 26 cents per share on revenue of $14.3 billion.
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Finally, Dell Inc. ( DELL ) is down about 3% in pre-market trading, as investors react to news that the company eared $441 million, or 22 cents per share, in the first quarter. Meanwhile, S&P 500 Index ( SPX ) futures are indicating an opening loss of more than 7 points. In earnings news, Aeropostale Inc. ( ARO ) is off about 2% in pre-market activity after the company posted first-quarter net income of $45.4 million, or 48 cents per share.
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16f5620a-3dec-44cb-bf1b-faa489c68c9c
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727046.0
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2010-05-17 00:00:00 UTC
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Options Strategy of the Day: A Bullish Pre-Earnings Volatility Play
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DELL
|
https://www.nasdaq.com/articles/options-strategy-day-bullish-pre-earnings-volatility-play-2010-05-17
|
nan
|
nan
|
With events in Europe and China shaping the bigger picture on Wall Street, it is easy to forget that we are smack in the middle of corporate earnings season. While we are about halfway through the current earnings calendar, there are several heavy hitters still scheduled to report. This week alone, we have Hewlett-Packard Co. ( HPQ ), Wal-Mart Stores Inc. ( WMT ), Deere & Co. ( DE ), and Dell Inc. ( DELL ), just to name a few. As such, options traders still have plenty of opportunities to benefit from this period of elevated volatility.
Now, many intermediate options traders have heard of strategies like straddles and strangles, and these plays work well during of periods of increased volatility by allowing the investor to profit regardless of the stock's directional move. The catch is that the stock has to move big, which is kind of the idea during periods of elevated volatility. But, what if you have a directional bias on the underlying stock?
Straddles and strangles may not have an opinion on which direction the shares of XYZ BrickLayers Corp. will move post-earnings, but you have your suspicions that the stock is due for a rally. Luckily for you, there is a way to increase your payout on a rally in XYZ shares, while still maintaining a "hedge" against a downside move: the strap.
Constructing a Strap
Straps are quite similar in construction to straddles. Instead of purchasing one at-the-money put and one at-the-money call, the strap trader will purchase one at-the-money put and two at-the-money calls. This gives the position a bias toward a rally in the underlying shares.
Let's take a look at an example. Sticking with your bullish bias on XYZ BrickLayers, you expect the company to report blowout quarterly results after the close on Friday. However, the market being what it is lately, not to mention the unpredictable nature of earnings reactions, you feel that you need some downside exposure. With XYZ trading at $52 per share, you purchase one June 52 put, last asked at $1.57, and two June 52 calls, last asked at $1.10 (or $2.20 total). As a result, you enter the trade with a net debit of $3.77, which represents the most you can possibly lose on the position.
Potential Outcomes
There are a couple potential outcomes for this strap position. Under the best-case scenario, XYZ impresses Wall Street with its quarterly report, and rallies significantly beyond $55.27 per share (the upper breakeven level). Keep in mind that a rally in the underlying stock is preferred because you have bought two calls for every one put. Assuming that XYZ closes at $60 per share at June expiration, the purchased June 52 put would expire worthless, while the two purchased June 52 calls would be worth a combined $16. Subtracting the net debit of $3.77 paid at initiation, your profit comes in at $12.23.
Your next best outcome for this strap strategy is for XYZ to plunge below $48.23 per share (the lower breakeven level). Assuming that XYZ sorely disappoints investors with its quarterly figures, and the shares plunge to $45 per share, the purchased June 52 calls would expire worthless, while the June 52 put would be worth $7. Subtracting the net debit of $3.77 paid at initiation, your profit comes in at $3.23.
The only way to lose in this example is for XYZ shares to have practically no reaction to their earnings data, leaving the shares close essentially flat at expiration. However, even in a worst-case scenario where XYZ closes at $52 per share when June options expire, your losses are limited to the net debit of $3.77 paid at initiation.
Wrapping Up
It may seem like the strap is the answer to the aggressive bullish trader's prayers, but options strategies that revolve around high levels of volatility are rarely as cut and dried as they seem. Just remember that while high levels of volatility are beneficial to a strap position, they can also increase the cost of entering the trade. Furthermore, trading around events, such as earnings reports and trial results, can be extremely risky. So, while the strap can give bullish traders a way of participating in volatile price swings, there is still a palpable degree of risk involved.
Schaeffer's Investment Research Inc. offers real-time option trading services, as well as daily, weekly and monthly newsletters. Please click here to sign up for free newsletters. The SchaeffersResearch.com website provides financial news, education and commentary, plus stock screeners, filters and many other tools. Founder Bernie Schaeffer is the author of the groundbreaking book, The Option Advisor: Wealth-Building Techniques Using Equity & Index Options .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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This week alone, we have Hewlett-Packard Co. ( HPQ ), Wal-Mart Stores Inc. ( WMT ), Deere & Co. ( DE ), and Dell Inc. ( DELL ), just to name a few. Now, many intermediate options traders have heard of strategies like straddles and strangles, and these plays work well during of periods of increased volatility by allowing the investor to profit regardless of the stock's directional move. Under the best-case scenario, XYZ impresses Wall Street with its quarterly report, and rallies significantly beyond $55.27 per share (the upper breakeven level).
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This week alone, we have Hewlett-Packard Co. ( HPQ ), Wal-Mart Stores Inc. ( WMT ), Deere & Co. ( DE ), and Dell Inc. ( DELL ), just to name a few. Instead of purchasing one at-the-money put and one at-the-money call, the strap trader will purchase one at-the-money put and two at-the-money calls. Assuming that XYZ closes at $60 per share at June expiration, the purchased June 52 put would expire worthless, while the two purchased June 52 calls would be worth a combined $16.
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This week alone, we have Hewlett-Packard Co. ( HPQ ), Wal-Mart Stores Inc. ( WMT ), Deere & Co. ( DE ), and Dell Inc. ( DELL ), just to name a few. Assuming that XYZ closes at $60 per share at June expiration, the purchased June 52 put would expire worthless, while the two purchased June 52 calls would be worth a combined $16. Assuming that XYZ sorely disappoints investors with its quarterly figures, and the shares plunge to $45 per share, the purchased June 52 calls would expire worthless, while the June 52 put would be worth $7.
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This week alone, we have Hewlett-Packard Co. ( HPQ ), Wal-Mart Stores Inc. ( WMT ), Deere & Co. ( DE ), and Dell Inc. ( DELL ), just to name a few. Straddles and strangles may not have an opinion on which direction the shares of XYZ BrickLayers Corp. will move post-earnings, but you have your suspicions that the stock is due for a rally. This gives the position a bias toward a rally in the underlying shares.
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9c1e95a7-22cc-4bb7-8b6f-3575cb9f38c7
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727047.0
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2010-04-30 00:00:00 UTC
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HP Faces an Uphill Battle in the Consumer Electronics Market
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DELL
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https://www.nasdaq.com/articles/hp-faces-uphill-battle-consumer-electronics-market-2010-04-30
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nan
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nan
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Chad Brand
After it was made public that smart-phone maker Palm ( PALM ) had put itself up for sale, most every rumored suitor was an Asian hardware firm such as HTC or Lenovo (LNVGY.PK). The logic was that Palm had a strong set of assets that would be a good fit for a foreign company looking to make a splash in the U.S. phone market without having to build the business from scratch. When Hewlett Packard ( HPQ ) surprised the Street this week with an agreement to buy Palm for about $1 billion, some praised the deal while others expressed their doubts. To me, it makes sense that HP would buy Palm as a way to more quickly enter the market for mobile devices, but I really doubt that we will look back two or three years from now and say buying Palm really paid off for HP.
There is no doubt that HP is getting a large patent portfolio, a strong team of engineers, and a proprietary operating system in Palm webOS, and it is reasonable to assume that HP did not have other ways to acquire such assets for less than the price it is paying for Palm. However, the question really is whether HP can gain traction in an already crowded market for smartphones and tablet PCs. Large hardware makers always seem eager to compete with the market leaders when new hot products come about but I do not think there is room for everyone.
Dell ( DELL ), for instance, is another computer maker that is developing both a cell phone and a tablet PC. HP is widely known to be developing a tablet and now with Palm it will be able to easily enter the cell phone market as well. Owning the operating system will make these products easier to control and produce than they were for HP before the deal (having to use Microsoft's ( MSFT ) mobile operating system in their products raises HP's costs due to licensing fees and gives them less flexibility in the design of the product), but companies like HP and Dell still face the challenge of bringing to market a product that people want more than a BlackBerry, iPhone, or iPad.
The track record of large computer-focused firms trying to invade leading innovators' turf is poor. Both HP and Dell have been trying for a long time to break into other consumer electronics sectors but really have not been successful. Many companies were convinced that they could grab a chunk of the MP3 player market, even with Apple's ( AAPL ) iPod as the best in class product, but companies like SanDisk ( SNDK ) (with its Sansa players) failed to gain much ground. Why would this trend change this time around? Do we really think a tablet PC from HP or Dell will be better than the iPad and therefore really hurt Apple? Can Barnes and Noble ( BKS ) or Sony ( SNE ) really take a bite out of the e-book reader market by dethroning the iPad or the Kindle?
It is highly unlikely that companies, no matter how large, can come along later with a me-too product and succeed. As a result, while we all can understand why HP buying Palm for $1 billion makes sense if their goal is to go after these markets, it is a lot harder to have confidence that such an endeavor will prove even remotely successful. For only $1 billion, which is mere pennies for a company as large as HP, they probably do not think it is a large risk to take. And they are probably right, on that front at least.
Disclosure: No position in HP or Palm at the time of writing, but positions may change at any time
See also Borders Seeks e-Book Strategy on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell ( DELL ), for instance, is another computer maker that is developing both a cell phone and a tablet PC. Owning the operating system will make these products easier to control and produce than they were for HP before the deal (having to use Microsoft's ( MSFT ) mobile operating system in their products raises HP's costs due to licensing fees and gives them less flexibility in the design of the product), but companies like HP and Dell still face the challenge of bringing to market a product that people want more than a BlackBerry, iPhone, or iPad. Both HP and Dell have been trying for a long time to break into other consumer electronics sectors but really have not been successful.
|
Dell ( DELL ), for instance, is another computer maker that is developing both a cell phone and a tablet PC. Owning the operating system will make these products easier to control and produce than they were for HP before the deal (having to use Microsoft's ( MSFT ) mobile operating system in their products raises HP's costs due to licensing fees and gives them less flexibility in the design of the product), but companies like HP and Dell still face the challenge of bringing to market a product that people want more than a BlackBerry, iPhone, or iPad. Both HP and Dell have been trying for a long time to break into other consumer electronics sectors but really have not been successful.
|
Owning the operating system will make these products easier to control and produce than they were for HP before the deal (having to use Microsoft's ( MSFT ) mobile operating system in their products raises HP's costs due to licensing fees and gives them less flexibility in the design of the product), but companies like HP and Dell still face the challenge of bringing to market a product that people want more than a BlackBerry, iPhone, or iPad. Dell ( DELL ), for instance, is another computer maker that is developing both a cell phone and a tablet PC. Both HP and Dell have been trying for a long time to break into other consumer electronics sectors but really have not been successful.
|
Dell ( DELL ), for instance, is another computer maker that is developing both a cell phone and a tablet PC. Owning the operating system will make these products easier to control and produce than they were for HP before the deal (having to use Microsoft's ( MSFT ) mobile operating system in their products raises HP's costs due to licensing fees and gives them less flexibility in the design of the product), but companies like HP and Dell still face the challenge of bringing to market a product that people want more than a BlackBerry, iPhone, or iPad. Both HP and Dell have been trying for a long time to break into other consumer electronics sectors but really have not been successful.
|
4c80271d-c9ec-4897-ac45-47470e8b68ae
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727048.0
|
2010-04-15 00:00:00 UTC
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Stocks to Buy and Sell: Ratings for the Top 50 Tech Stocks
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DELL
|
https://www.nasdaq.com/articles/stocks-buy-and-sell-ratings-top-50-tech-stocks-2010-04-15
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nan
|
nan
|
We are seeing a "tech renaissance" right now, with many information technology, software and personal electronics companies seeing rapid share appreciation in the last 12 months.
It's no secret why: As the world gets more wired, communications have become a necessity and gadgets once thought of as fads are now necessary parts of doing business in the 21st century. I, for one, couldn't imagine getting anything done without my trusty Apple ( AAPL ) iPhone and laptop with me 24/7.
But this bullishness on the entire tech sector can be confusing for investors. Some technology stocks are getting a lot of hype that's deserved, but others are simply being lifted by a rising tide for technology firms right now.
How can you tell the difference? Simple: Follow the fundamentals. My proprietary Portfolio Grader stock-ranking tool runs a fundamental analysis on the top 5,000 Wall Street companies every week. My team of analysts and I sift through the latest earnings forecasts, sales numbers, margin expansion percentages and a host of other figures. Our results are screened based on what's working best on Wall Street right now, and then Portfolio Grader outputs a rating for each company reflected as a simple letter grade, with A being "strong buy" and F being "strong sell."
Portfolio Grader's stock data is free and can be accessed online here . I strongly encourage you to check it out and screen your own holdings.
But since tech is so hot right now, here's a complete rundown of the 50 biggest tech stocks (ranked by market cap) and how they stack up fundamentally.
Related Articles:
Stock Downgrades: BAC, BA, PC, TM
Stock Upgrades: COST, LLY, RDS, WMT
How Gold and the Dollar Index Are Fooling You
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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We are seeing a "tech renaissance" right now, with many information technology, software and personal electronics companies seeing rapid share appreciation in the last 12 months. My proprietary Portfolio Grader stock-ranking tool runs a fundamental analysis on the top 5,000 Wall Street companies every week. My team of analysts and I sift through the latest earnings forecasts, sales numbers, margin expansion percentages and a host of other figures.
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My proprietary Portfolio Grader stock-ranking tool runs a fundamental analysis on the top 5,000 Wall Street companies every week. Related Articles: Stock Downgrades: BAC, BA, PC, TM Stock Upgrades: COST, LLY, RDS, WMT How Gold and the Dollar Index Are Fooling You The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Our results are screened based on what's working best on Wall Street right now, and then Portfolio Grader outputs a rating for each company reflected as a simple letter grade, with A being "strong buy" and F being "strong sell." But since tech is so hot right now, here's a complete rundown of the 50 biggest tech stocks (ranked by market cap) and how they stack up fundamentally. Related Articles: Stock Downgrades: BAC, BA, PC, TM Stock Upgrades: COST, LLY, RDS, WMT How Gold and the Dollar Index Are Fooling You The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
We are seeing a "tech renaissance" right now, with many information technology, software and personal electronics companies seeing rapid share appreciation in the last 12 months. My proprietary Portfolio Grader stock-ranking tool runs a fundamental analysis on the top 5,000 Wall Street companies every week. Our results are screened based on what's working best on Wall Street right now, and then Portfolio Grader outputs a rating for each company reflected as a simple letter grade, with A being "strong buy" and F being "strong sell."
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66328292-d848-432d-bfff-81170fec7df4
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727049.0
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2010-03-19 00:00:00 UTC
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The Smartest Parts of the IT Market
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DELL
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https://www.nasdaq.com/articles/smartest-parts-it-market-2010-03-19
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nan
|
nan
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Some people always face the wrong way. Take the case of the average IT analyst. Many come from an industry background, and as a result they cannot but help see the world through the lens of desktop PCs, servers, outsourcing and enterprise software systems. This is unfortunate, because over the last decade corporate IT growth has been meager and the prospects do not look that much brighter.
In 2000, $371 billion was spent on PC hardware. By last year, this had shrunk to $326 billion, according to estimates from Gartner, a US based market researcher. This number includes the value of PCs, servers, printers and storage. For further confirmation, I suggests you examine the 10-year price charts for Microsoft ( MSFT ), Dell ( DELL ), or Intel ( INTC ). They are not quite flatlining, but the pulse is weak.
By contrast, where we have seen growth is in emerging markets, consumers and mobile telephony: A decade ago consumers represented 33% of desktop computer sales; by last year this had risen to 38% of the total. In the notebook segment, the contrast between business and consumer is even more striking: A decade ago consumers represented 32% of total sales; by last year this had risen to 56%.
Mobility and consumers are what drives the IT market. This trend is accelerating as smartphone shipments overtake computer hardware sales over the next two to three years. This is the single most important fact in technology investing. Missing it is rather like wandering past Mount Everest in the fog.
The catalyst for the long awaited pick-up in IT expenditure is said to be the PC replacement cycle. By 2011, it is estimated that 84% of desktop computers used by business will be five years old. In addition, corporate IT sales are expected to get a boost from Microsoft's recently released Windows 7 operating system. There is merit to this argument, just as there was merit to it during the last decade, but don't hold your breath.
Most of the profits from the PC market go to Intel and Microsoft. Both companies have a better grip on the computer market than any analyst. When speaking in January, Paul Otellini, Intel's chief, answered a question about a likely pick-up in enterprise spending by stating that growth would continue to be dominated by emerging markets and consumers. Both trends, as Otellini pointed out, lead to lower average selling prices.
Over at Microsoft, the picture was similar. Peter Klein, the company's CFO said, that growth had been driven largely by strong consumer demand. He went on to say, "While consumer growth remained healthy, we have not seen a return of enterprise spending growth." The problem with IT is that the price of hardware tumbles each year. You can best see this by comparing unit shipments to sales: in 2000, 146 million PCs were shipped; by last year this had risen to 306m. Over that time revenues between the two data points had fallen 12%. Then, when you examine the trends that so enamour the average IT analyst, it looks suspiciously as though they will add to deflation. First, off, Windows 7 needs less memory and raw computing power than its predecessor, Vista; second, cloud computing itself requires less hardware.
My gripe with the whole PC upgrade cycle argument is that it has not worked for more than a decade. The reason it has not appeared in all that time is that corporate IT stopped being innovative sometime back in the 1990s. The truly last innovative piece of software that businesses needed to buy were enterprise resource planning (( ERP )) systems, which required the move to client server computing. This move, coincided with the launch of Windows 95 and the Unix/Linux operating systems and was the reason that stocks like Dell rose several thousand percent over the course of the 1990s. As if the move to client server were not enough, after 1995 the rise of the internet and the Y2K problem added momentum to what was already a strong trend.
Nothing like that exists anymore.
Where you do see a strong product cycle is, of course, in the area of mobility and the internet. Last year around 200m smart phones were sold. A new research report just out from ABI estimates that smartphone shipments increased 30% in Q4 over Q3. Our recent visit to Asia suggests that the smartphone trend has just taken hold there too, which may cause further surprises for analysts following this market.
At some point over the next two to three years these devices will outsell personal computers. Looked at in terms of revenue, last year the pure PC market, net of servers, printers and storage, was worth $224 billion, compared to $165 billion for the handset market. With smartphones now the fastest growing part of the mobile phone market, they will soon over take PCs in value as well as in unit terms.
This rise is the confirmation of the single biggest trend taking place in technology: mobile internet access. In turn this is generating colossal demand for content, as we can see from the rise in video traffic, which is more than doubling each year. Cisco ( CSCO ) estimates that by 2013, video traffic will represent 70% of the volume on mobile networks. YouTube has just announced that 24 hours of video is uploaded to its site each minute of the day, compared to 20 hours of video six months ago.
In a recent report from Chetan Sharma Consulting, it has been estimated that there were 7 billion software application and content downloads to mobile phones last year and that this will rise to 50 billion by 2012. By then the market for applications supplied to smartphones is expected to be of the order of $17 billion. This market barely existed a couple of years ago. This is a tsunami that will result in surprisingly strong profit growth and share price gains for a number of device and component makers and maybe some software companies, such as Sybase ( SY ). Google ( GOOG ) and Facebook will also win from this trend, as advertisers will pay more for mobile viewers.
The next place that this move to mobile computing will manifest itself is in the rise of the tablet computer. On this score, investors might like to monitor what is happening with estimates for Apple's ( AAPL ) iPad computer. When first announced, most analysts seemed rather underwhelmed. The range was somewhere around 4 million units.
More recently, at least one major US investment bank has increased its estimate to 6 million units. Meanwhile, the buzz in Taiwan, among component suppliers, is that Apple is looking at 10 million units. If this device proves a success, it will be emulated by other device makers.
ARM ( ARMH ), the UK chip company, is the leading European beneficiary of this trend, as is Imagination Technologies ( IGNMF.PK ), which provides graphics chip intellectual property. CSR plc [LON:CSR], the Bluetooth and Wi-Fi chip maker, should also benefit. Infineon ( IFNNY.PK ) and STM ( STM ) in Germany and France, as providers of radio and baseband chips, will also see some impact. In Taiwan, outside of obvious names such as Hon Hai ( HNHAF.PK ) and Foxconn ( FXCNY.PK ), investors ought to look at touch screen makers, such as Wintek ( WNTSF.PK ). The LED supply chain, which will provide the backlighting for these devices, will also gain. In America, this would include Cypress Semiconductor ( CY ) and Synaptics ( SYNA ).
So, the next time an IT analyst tells you that the Windows 7 PC upgrade cycle or the move to Cloud computing are the main events in the IT market, hit him over the head with your smartphone.
Disclosure: No positions
See also Hewlett-Packard: Printers More Valuable Than PCs on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For further confirmation, I suggests you examine the 10-year price charts for Microsoft ( MSFT ), Dell ( DELL ), or Intel ( INTC ). This move, coincided with the launch of Windows 95 and the Unix/Linux operating systems and was the reason that stocks like Dell rose several thousand percent over the course of the 1990s. When speaking in January, Paul Otellini, Intel's chief, answered a question about a likely pick-up in enterprise spending by stating that growth would continue to be dominated by emerging markets and consumers.
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For further confirmation, I suggests you examine the 10-year price charts for Microsoft ( MSFT ), Dell ( DELL ), or Intel ( INTC ). This move, coincided with the launch of Windows 95 and the Unix/Linux operating systems and was the reason that stocks like Dell rose several thousand percent over the course of the 1990s. By contrast, where we have seen growth is in emerging markets, consumers and mobile telephony: A decade ago consumers represented 33% of desktop computer sales; by last year this had risen to 38% of the total.
|
For further confirmation, I suggests you examine the 10-year price charts for Microsoft ( MSFT ), Dell ( DELL ), or Intel ( INTC ). This move, coincided with the launch of Windows 95 and the Unix/Linux operating systems and was the reason that stocks like Dell rose several thousand percent over the course of the 1990s. By contrast, where we have seen growth is in emerging markets, consumers and mobile telephony: A decade ago consumers represented 33% of desktop computer sales; by last year this had risen to 38% of the total.
|
For further confirmation, I suggests you examine the 10-year price charts for Microsoft ( MSFT ), Dell ( DELL ), or Intel ( INTC ). This move, coincided with the launch of Windows 95 and the Unix/Linux operating systems and was the reason that stocks like Dell rose several thousand percent over the course of the 1990s. By contrast, where we have seen growth is in emerging markets, consumers and mobile telephony: A decade ago consumers represented 33% of desktop computer sales; by last year this had risen to 38% of the total.
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221b7f45-158f-40bd-91b1-161a0188b613
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727050.0
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2010-02-12 00:00:00 UTC
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Stick with the Best in This Emerging Industry
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DELL
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https://www.nasdaq.com/articles/stick-best-emerging-industry-2010-02-12
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nan
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nan
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Throughout the 1990s tech boom, Dell (Nasdaq: DELL) made life miserable for any other firm trying to sell computers. Its lean operations enabled it to generate solid profits even as price wars kept most rivals' bottom lines in the red. First Solar (Nasdaq: FSLR) has taken a page from Dell's playbook, establishing a cost structure and pricing model that ensure profits for itself and pure misery for its rivals.
There is a key distinction between Dell and First Solar, however: Dell held no inherent technical advantage and was ultimately unable to distinguish itself as computers became commodities. First Solar's intellectual property, on the other hand, is a key differentiator. The company developed a novel and successful way to mass produce solar cells using cadmium and tellurium in an industrial process that allowed it to use very small amounts of these metals. This reduced its costs to about half of its competitors.
First Solar is now the global leader in the production of thin-film solar, which captures less of the sun's energy than traditional silicon-based solar panels but can not only be made far more cheaply but also can be deployed in a wider variety of applications. The company's aggressive pricing led to a sharp rise in sales in recent years, even as demand for other solar players' panels flattened out.
The solar industry is set to suffer the ill effects of a spending boom that started two years ago, when oil prices led investors to pump money into additional solar-panel production capacity. In recent quarters, global supply has been ramping up, creating a glut that likely will hammer prices later this year. This helps explain why earnings estimates for First Solar -- and all of its peers -- have been falling in recent months. Stock prices in the group have followed suit.
When the dust settles, investors will seek the companies with the most compelling technological platforms and the strongest balance sheets. First Solar, already the low-price leader, has consistently been able to lower its manufacturing costs, which are set to fall even further in coming years. In 2007, the company was able to build modules for roughly $1.40 per watt of power. That figure breached the $1 mark late in 2008, and could approach $0.75 sometime later this year. The company now spends roughly $100 million per year on research and development.
Rivals utilizing the traditional silicon-based approach have also lowered production costs, and the gap between the two technologies has remained relatively constant. Realizing that rivals might willingly lose money on contracts in order to preserve market share, First Solar has used its robust balance sheet to buy up demand. It's acquired development rights to build major power plant projects that ensure a steady need for the company's gear. That shift has forced investors to grasp a changing business model - one with higher sales but lower profit margins. The company issued sales guidance that was well above consensus forecasts, though profit forecasts were only in line with existing expectations.
As you can imagine, that's a lot for investors to digest, which explains why they have been walking away from the stock. Its shares have fallen nearly -50% since last June. The long-term prognosis is for a continued upturn in solar-cell demand that will catch up to the industry supply glut, probably in 2011. That should help prices stabilize or even rebound. Couple that with the fact that First Solar is expected to complete the production of new facilities later this year, and First Solar may see sales and profits rise at a +20% to +30% clip in 2011.
First Solar shares have rarely traded this cheap -- currently for about 14 times forecasted earnings. That's roughly on par with the broader market, and discounts the value of the company's pristine balance sheet (roughly $600 million in net cash), leading-edge technology, and dominant market share of roughly 20%. Although it will take some time before investors look out to 2011 and beyond, when they do, they will see an industry - and a stock - that is poised to make a continuing dent in the global energy picture.
-- David Sterman
Contributor
Street Authority
P.S. My colleague Andy Obermueller recently recommended First Solar for its tie to a huge Chinese government contract. Andy calls it a "serious growth stock best suited for longer-term investors." If you can't afford to wait for the "long-term" you should definitely check out one of his latest discoveries: It's a little-known stock that he thinks could generate a +257% gain in the next year -- driven by increasing global demand and strong government action. Go here to check out Andy's briefing on this opportunity.
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2010 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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First Solar (Nasdaq: FSLR) has taken a page from Dell's playbook, establishing a cost structure and pricing model that ensure profits for itself and pure misery for its rivals. Throughout the 1990s tech boom, Dell (Nasdaq: DELL) made life miserable for any other firm trying to sell computers. There is a key distinction between Dell and First Solar, however: Dell held no inherent technical advantage and was ultimately unable to distinguish itself as computers became commodities.
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Throughout the 1990s tech boom, Dell (Nasdaq: DELL) made life miserable for any other firm trying to sell computers. First Solar (Nasdaq: FSLR) has taken a page from Dell's playbook, establishing a cost structure and pricing model that ensure profits for itself and pure misery for its rivals. There is a key distinction between Dell and First Solar, however: Dell held no inherent technical advantage and was ultimately unable to distinguish itself as computers became commodities.
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Throughout the 1990s tech boom, Dell (Nasdaq: DELL) made life miserable for any other firm trying to sell computers. First Solar (Nasdaq: FSLR) has taken a page from Dell's playbook, establishing a cost structure and pricing model that ensure profits for itself and pure misery for its rivals. There is a key distinction between Dell and First Solar, however: Dell held no inherent technical advantage and was ultimately unable to distinguish itself as computers became commodities.
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First Solar (Nasdaq: FSLR) has taken a page from Dell's playbook, establishing a cost structure and pricing model that ensure profits for itself and pure misery for its rivals. There is a key distinction between Dell and First Solar, however: Dell held no inherent technical advantage and was ultimately unable to distinguish itself as computers became commodities. Throughout the 1990s tech boom, Dell (Nasdaq: DELL) made life miserable for any other firm trying to sell computers.
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dc297d4a-836c-48be-bd09-7962e994f882
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727051.0
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2010-02-10 00:00:00 UTC
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For This Value Stock, Just Do the Math
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DELL
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https://www.nasdaq.com/articles/value-stock-just-do-math-2010-02-10
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nan
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nan
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Certain stocks are either loved or hated. Investors shun them when sales and profits are sliding, yet become quickly enamored when results start to improve. But any rebound in a company's operating picture can come in fits and starts, so when speed bumps emerge in the story, momentum-chasing investors tend to dump a stock. In the case of Motorola ( MOT ) , their loss could be your gain.
Roughly 18 months ago, it appeared Motorola was headed for ruin as operating losses grew. Investors questioned whether the company's disparate divisions still held any value. Shares moved down below $4 for much of the market downturn, and even briefly breached the $3 mark when the market collapsed. But management finally understood the depths of the problems and decided to take a big cut at expenses while maintaining research and development on products. Those moves steadily paid off and the shares began to rise from the ashes to a recent high of $9.45.
Such meteoric ascents are often the work of momentum investors typically seeking to ride a wave of good news, and then flee at the appearance of any bad news. When Motorola reported tepid fourth-quarter results, it was a race for the exits. Shares are down roughly -30% in the past three months, putting them back into value territory. To get a sense of that value, you need to look at the company as a series of distinct parts. Taken together, those parts appear to be worth about $9.
Let's start with the balance sheet, where the company has roughly $4.1 billion in net cash ($1.77 a share). Motorola is expected to generate $2 billion to $3 billion in free cash flow this year, so the cash position should be at least $6 billion by year-end, but we'll stick with that $1.77 a share calculation for now.
We can next assess the value for the company's Enterprise & Mobility Segment ( EMS ), which sells communications equipment to public safety agencies and asset monitoring equipment (acquired through its purchase of barcode and RFID vendor Symbol Technologies a few years back). The EMS division is likely worth roughly $9.5 billion ($4.08 a share), based on an assumption of seven times projected 2010 EBITDA (on an enterprise value basis). That multiple is lower than pure play companies in the EMS segment such as Zebra Technologies (Nasdaq: ZBRA) and Intermec ( IN ) .
Together, Motorola's EMS division and current cash balance are worth around $6, not far below the current stock price. Investors are getting the company's remaining two divisions for free. The first is the Home & Networks Mobility ( HMS ) division, which makes set-top cable boxes and other telecom hardware. The unit generates about $8 billion in annual sales and $700 million in operating cash flow, and is likely worth four or five times cash flow -- let's call it $3 billion ($1.30 a share).
Then we can look at the much-maligned mobile phone division, which was an industry leader just five years ago with its Moto phone, but is now an industry laggard. This division hemorrhaged cash in recent years, but massive cost cuts have shrunk those losses and management believes the division will become profitable by the end of 2010.
The optimism stems from a decision to get behind Google's (Nasdaq: GOOG) Android operating system. Google-based smartphones have become an early hit for Motorola, as two million units were sold in the fourth quarter of 2009. Motorola is also working with Google to sell a smartphone direct to consumers through the Web, similar to Google's collaboration with HTC on the Nexus One phone.
Motorola gets more than $400 for each of these smartphones, well more than the $120 average sale price for traditional cell phones. Notably, Motorola understated revenues in this segment by $200 million in the fourth quarter due to an accounting provision. This early success is having an understated impact on the income statement thus far, but that will change in 2010 when new rules are adopted that require only a portion of smartphone sales to be deferred.
So how do you value a struggling mobile phone business that has been showing new promise? Dell (Nasdaq: DELL) trades at just 0.3 times revenue, while Nokia ( NOK ) , Palm (Nasdaq: PALM) and RIMM (Nasdaq: RIMM) trade at 0.9x, 1.1x, and 1.7x, respectively. If Motorola's division traded at 0.5 times revenue, the division would be worth $4 billion, or $1.65 a share. Taken together, the HMS and mobile phone divisions are likely worth about $3 a share. This means we're looking at a nearly +50% appreciation from the current price to become fairly valued .
Management has acknowledged that Motorola has become an unwieldy conglomerate . It knows these assets need to be monetized to truly unlock shareholder value. Whether that will come in the form of splitting the company in two or a selloff of one of the units (both have been discussed) remains to be seen. As that process unfolds, shares of Motorola should again re-visit recent peaks.
-- David Sterman
Contributor
Street Authority
Disclosure: David Sterman does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2016 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Dell (Nasdaq: DELL) trades at just 0.3 times revenue, while Nokia ( NOK ) , Palm (Nasdaq: PALM) and RIMM (Nasdaq: RIMM) trade at 0.9x, 1.1x, and 1.7x, respectively. But any rebound in a company's operating picture can come in fits and starts, so when speed bumps emerge in the story, momentum-chasing investors tend to dump a stock. The EMS division is likely worth roughly $9.5 billion ($4.08 a share), based on an assumption of seven times projected 2010 EBITDA (on an enterprise value basis).
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Dell (Nasdaq: DELL) trades at just 0.3 times revenue, while Nokia ( NOK ) , Palm (Nasdaq: PALM) and RIMM (Nasdaq: RIMM) trade at 0.9x, 1.1x, and 1.7x, respectively. We can next assess the value for the company's Enterprise & Mobility Segment ( EMS ), which sells communications equipment to public safety agencies and asset monitoring equipment (acquired through its purchase of barcode and RFID vendor Symbol Technologies a few years back). The unit generates about $8 billion in annual sales and $700 million in operating cash flow, and is likely worth four or five times cash flow -- let's call it $3 billion ($1.30 a share).
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Dell (Nasdaq: DELL) trades at just 0.3 times revenue, while Nokia ( NOK ) , Palm (Nasdaq: PALM) and RIMM (Nasdaq: RIMM) trade at 0.9x, 1.1x, and 1.7x, respectively. Motorola is expected to generate $2 billion to $3 billion in free cash flow this year, so the cash position should be at least $6 billion by year-end, but we'll stick with that $1.77 a share calculation for now. The unit generates about $8 billion in annual sales and $700 million in operating cash flow, and is likely worth four or five times cash flow -- let's call it $3 billion ($1.30 a share).
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Dell (Nasdaq: DELL) trades at just 0.3 times revenue, while Nokia ( NOK ) , Palm (Nasdaq: PALM) and RIMM (Nasdaq: RIMM) trade at 0.9x, 1.1x, and 1.7x, respectively. Together, Motorola's EMS division and current cash balance are worth around $6, not far below the current stock price. Motorola gets more than $400 for each of these smartphones, well more than the $120 average sale price for traditional cell phones.
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e622eac0-89fa-4046-969f-b7786c49ca28
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727052.0
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2010-01-18 00:00:00 UTC
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Herrings in Copenhagen?
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DELL
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https://www.nasdaq.com/articles/herrings-copenhagen-2010-01-18
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nan
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nan
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We discussed the Copenhagen Climate Change Conference and its implications with Adam Kanzer, managing director and general counsel ofDomini Social Investments. Domini was one of the first asset managers to offer a stable of socially responsible mutual funds and factor environmental issues into its investment decisions; we remain agnostic regarding the climate debate but were eager to get his take on what investments will make green for long-term investors. Although Kanzer agrees that the Copenhagen Summit failed to meet expectations, he believes that tighter carbon regulation will come to the US--with or without a broader international agreement.
Some climate-conscious observers have heralded the Copenhagen Climate Change Conference as a success based on the agreement for further talks; others have labeled it a complete failure simply because it didn't produce any substantive resolutions. What's your take?
I wouldn't say that the conference failed to achieve anything, but a lot of investors--ourselves included--had hoped the Copenhagen talks would produce a strong resolution regarding carbon dioxide (CO2) emissions. In that regard, uncertainty still exists and presents real risks for investors and companies; it's difficult for corporations to engage in long-term planning and capital investment without specific limitations on CO2 emissions or a definitive agreement.
On the other hand, establishing a framework for future talks with China was a critical step. The US and Europe could do everything possible to restrict CO2 emissions, but such efforts would matter little if China isn't on board. And odds were high going into the conference that President Obama wouldn't be able to secure a meaningful agreement; from a pragmatic standpoint, he achieved what was achievable. We hope that future talks will lead to a clear, binding resolution.
Could the US unilaterally enact stringent environmental regulation?
Ceres is a coalition of investors, environmental organizations and other public interest groups that work with companies to address climate change and other sustainability issues. The group issued a statement calling for participants in the Copenhagen summit to produce a strong resolution limiting CO2 emissions--an endorsement from money managers that oversee some $13 trillion in assets.
A group of leading US companies also has advocated for the certainty that comes from strong national legislation and a legally binding international agreement on climate change. All of that support is tough to ignore.
The Securities and Exchange Commission ( SEC ) also issued a bulletin last October permitting shareholder resolutions that explicitly ask how social and environmental risks affect a company's long-term value. Investors will definitely see more proposals addressing climate risk.
Prior to the Copenhagen talks, the Environmental Protection Agency ( EPA ) declared carbon a pollutant. This follows new disclosure requirements that the EPA issued last year.
Uncertainty abounds about the form of future regulation, but it's clear that new rules are coming and will put a price on CO2 emissions.
If an international accord is reached, would it be a patchwork system or a unified, global scheme?
I imagine that different nations would implement different regimes, giving rise to a patchwork system. But the global nature of climate change requires a binding international agreement. A ton of CO2 emitted in the US represents the same risk to China as a ton of carbon emitted in China represents to the US. International coordination is a must; it's impossible to solve a global problem locally.
Any international agreement also would have to set up a pricing scheme for CO2 emissions that would establish strong disincentives for exceeding emissions limits.
Will developed economies have to help their developing neighbors?
Developing countries didn't create the problem. China didn't create the problem, but its coal consumption is growing rapidly with its economy and contributing to unacceptable levels of CO2 in our atmosphere. Developing countries need to be part of the solution by virtue of their size and energy mix but will require incentives to secure their participation. Developed countries likely will need to pick up the tab and take responsibility.
Are any companies taking proactive steps to prepare for new carbon regulation?
A host of companies have been preparing for years, and many put out annual reports discussing how they're measuring and reducing their carbon footprints.
A few years back we participated in a dialogue with JP Morgan Chase ( JPM ) that prompted the financial giant to adopt a comprehensive environmental policy focused on climate change. The bank now speaks to its clients about how they're addressing climate change.
Nike ( NIKE ), The Gap ( GPS ), Starbucks ( SBUX ), and North Face Apparel are among a cadre of companies that participate in Business for Innovative Climate & Energy Policy, a business group that actively calls for strong CO2 regulation.
And IBM ( IBM ), Dell ( DELL ) and Hewlett-Packard ( HPQ ) are among a growing number of firms that have implemented measures to improve energy efficiency. Many companies are also analyzing how their supply chains contribute to climate risk. The Timberland Company ( TBL ) has taken particularly innovative steps to label the carbon intensity of its products.
The insurance industry was ringing alarm bells years ago. Munich Re (Germany: MUV2) and Swiss Re ( SWCEY ), in particular, have made strong statements about potential risks. When reinsurers take a public stand on an environmental issue, the problem must be serious. Swiss Re and other insurers are concerned that the effects of global climate change could bring the industry to its knees--the risks involved are simply too big to cover. If CO2 regulation isn't done right, insurance firms could find themselves deep underwater.
Even some companies that arguably would be hit the hardest by CO2 limits have acknowledged the reality of climate change and the need to act. A few years ago Cinergy, a utility that relies almost entirely on coal-fired facilities, issued a report on climate change to establish an open dialogue with its investors about climate change, the risk it poses to the company's business and potential solutions.
Companies have implemented all manner of measures to understand how a low-carbon environment will affect their businesses and how to prepare for that eventuality, but an individual firm can only do so much planning without regulatory clarity.
Tighter regulation would entail higher costs, but is there a potential economic upside?
The transition to a low-carbon economy would create opportunities for technological innovation, new products, new ways of thinking about efficiency and design, and new ways of providing energy and transportation--it would affect every sector. We could be on the verge of an entrepreneurial revolution. Goldman Sachs ( GS ) has a sustainability group that examines the risks and opportunities, and Deutsche Bank ( DB ) has delivered presentations about the huge upside potential--after all, this new economy will require financing.
If regulation is implemented thoughtfully it will incentivize the shift to a low-carbon economy, drive innovation and remove as much uncertainty as possible. Unfortunately, it's impossible to eliminate all uncertainty about how quickly this will play out. But the upside potential of strong, effective regulation should be significant, and smart companies are already positioning themselves to benefit. Investors should do the same with their portfolios.
Last year the SEC selected you to serve on its newly formed Investment Advisory Committee. Is that body working on these issues?
Part of the SEC Investment Advisory Committee's mandate is to address the whole area of environment, social and governance disclosure by companies. The SEC has received substantial input on the topics, including recent proposals from Ceres and the Social Investment Forum on climate risk and mandatory sustainability reporting, respectively.
From my perspective, such information is material to investors; companies should disclose these details, though most do not at this point. I'm looking for the SEC to clarify that these issues are material and mandate some form of sustainability reporting. SEC Commissioner Ellisse Walter stated a few months ago that the time is right to classify climate change as a material risk and to require relevant disclosures.
As I mentioned before, some companies already disclose this information. The Carbon Disclosure Project surveys the world's largest companies annually to determine their carbon footprint. Investors that oversee $55 trillion in assets endorse and use this information, and that number increases with each year. On the one hand, this effort is great and sends the message to companies that investors regard these issues as material. On the other hand, a lack of SEC requirements necessitates this project and reflects how difficult such information is to obtain--especially in a readily comparable format.
What's your best advice for investors going forward?
Take a hard look at how climate change will affect the stocks in your portfolio and any of your prospective investments. Start asking hard questions about how companies--and your investment managers--regard climate risk and how they're addressing it. Investors should also support shareholder proposals appearing on corporate proxy statements seeking disclosure of these risks.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
Article Republished with permission from www.KCIinvesting.com and www.rukeyser.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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And IBM ( IBM ), Dell ( DELL ) and Hewlett-Packard ( HPQ ) are among a growing number of firms that have implemented measures to improve energy efficiency. Some climate-conscious observers have heralded the Copenhagen Climate Change Conference as a success based on the agreement for further talks; others have labeled it a complete failure simply because it didn't produce any substantive resolutions. In that regard, uncertainty still exists and presents real risks for investors and companies; it's difficult for corporations to engage in long-term planning and capital investment without specific limitations on CO2 emissions or a definitive agreement.
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And IBM ( IBM ), Dell ( DELL ) and Hewlett-Packard ( HPQ ) are among a growing number of firms that have implemented measures to improve energy efficiency. I wouldn't say that the conference failed to achieve anything, but a lot of investors--ourselves included--had hoped the Copenhagen talks would produce a strong resolution regarding carbon dioxide (CO2) emissions. The group issued a statement calling for participants in the Copenhagen summit to produce a strong resolution limiting CO2 emissions--an endorsement from money managers that oversee some $13 trillion in assets.
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And IBM ( IBM ), Dell ( DELL ) and Hewlett-Packard ( HPQ ) are among a growing number of firms that have implemented measures to improve energy efficiency. In that regard, uncertainty still exists and presents real risks for investors and companies; it's difficult for corporations to engage in long-term planning and capital investment without specific limitations on CO2 emissions or a definitive agreement. Ceres is a coalition of investors, environmental organizations and other public interest groups that work with companies to address climate change and other sustainability issues.
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And IBM ( IBM ), Dell ( DELL ) and Hewlett-Packard ( HPQ ) are among a growing number of firms that have implemented measures to improve energy efficiency. This follows new disclosure requirements that the EPA issued last year. But the global nature of climate change requires a binding international agreement.
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7e2a7f0e-8f30-40cf-a03c-00f407f8a9fe
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727053.0
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2009-12-06 00:00:00 UTC
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Share the Wealth, Part III: Our Final Four Cash-Rich Companies
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DELL
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https://www.nasdaq.com/articles/share-wealth-part-iii-our-final-four-cash-rich-companies-2009-12-06
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nan
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nan
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Today we conclude our three-part series examining the companies with the biggest bank accounts, and whether they are worthwhile investments for the upcoming New Year.
Company (Ticker)Cash/Near Cash GE F MRK HPQ XOM JNJ
In Part One, we studied General Electric ( GE ) and Warren Buffett's Berkshire Hathaway (NYSE: BRK-A) . Part II gave us the opportunity to delve into Ford ( F ) , Merck ( MRK ) , Oracle (Nasdaq: ORCL) and Hewlett-Packard ( HPQ ) .
We'll look at four companies today, all of which are household names. Computer giant Dell (Nasdaq: DELL) , search pioneer Google (Nasdaq: GOOG) , drug maker Johnson & Johnson ( JNJ ) and petroleum titan Exxon Mobil ( XOM ) , which holds the distinction of being the most profitable company in the United States.
No. 7: Dell Inc. (Nasdaq: DELL) , $12.8 billion
Selling computers is a tough racket.
Computer manufacturers must deal either with finicky consumer tastes or with corporate customers whose technology budgets are dependent on a fickle economy. Neither group is easy to plan for. Both demand the latest technology and shop almost entirely on price. As if those business conditions didn't add up to low enough margins, the whole enchilada rests squarely on continual and expensive ad campaigns. The result is that Dell, the No. 2 computer maker, takes in scads of revenue -- about $60 billion a year -- but gets to keep relatively little of it.
No company can afford to rest long, but the technology sector is known for especially intense, NBA-like competition. In the fight to sell computers, Dell can't even afford to blink. Hewlett-Packard is a relentless opponent. Upstart competitor Acer constantly nips at Dell's heels. And then Asustek came along and had the idea of making computers even cheaper with its stripped-down netbook, an idea that totally remade the industry almost overnight.
Dell makes decent computers and sells them cheap, but its investors never get anywhere. That's clear from the static shareholder equity line. Ideally, a company should maintain a reasonable cash position and use some of its free cash flow to reduce debt over time. Dell simply can't do this for one simple reason: It doesn't have enough money. Its cost of goods and operating expenses mean a razor thin operating profit of just 5.2%. Apple (Nasdaq: AAPL) , whose consumers do not shop on price, maintains a 21.0% operating margin. And, surprise, the company's balance sheet is not only devoid of any long-term debt, its shareholder equity line continually grows. Dell will never be able to match Apple's model.
That's the cost of competing on price.
Dell is fairly valued and looks poised to deliver lackluster earnings of $0.97 in the year ended Jan. 31, 2010, about 50 cents per share less than its recent good years. At 14 times earnings, Dell's current valuation exceeds its two-year average. Going forward, the consensus estimate of $1.21 seems to err on the side of optimism for an economic recovery, and even if it is dead-on it implies only a modest +7.4% upside at its historical valuation.
Cash is great if it can be used to generate significant profits. Dell can't do this and, importantly, it never will be able to. I think investors should look elsewhere.
No. 8: ExxonMobil Corp. ( XOM ) , $12.5 billion
ExxonMobil is worth $354.9 billion. Last year's revenue, at $460 billion, exceeded Wal-Mart's ( WMT ) by a wide margin. Exxon posted net earnings of $4.7 billion last quarter alone -- enough to buy Hasbro outright -- and $13.3 billion in the first nine months of this year, which would add two aircraft carriers to the Navy's Pacific Fleet.
The most surprising thing about Exxon, given these humongous numbers, is that it doesn't have more cash. After all, its cash line is roughly equal to this year's profits. So investors, when looking at Exxon's books, need to ask one critical question:
What gives?
The answer lies in management's laser-like focus on the future.
Now, don't worry. I'm not going to launch into some diatribe about how the world's biggest oil company is spending gazillions on harnessing tidal energy to bring about cheap power and world peace. While Exxon certainly invests substantial sums in "green" energy -- it recently committed $600 million to an algae-based biofuel program -- its main focus remains on finding more crude and acquiring the rights to it.
This is the first and most important thing this company does, so it's not surprising that it's the first topic of the annual report. Here is what the company said as it reported its 2008 results: "By 2030 global energy demand is expected to increase by about 30 percent from today's level, even assuming significant gains in energy efficiency. Oil and natural gas will remain the world's primary energy sources, meeting close to 60% of the demand. ExxonMobil plans to invest more than $125 billion over the next five years developing future energy supplies."
It is this investment that will be the future of the company. That's where most of its cash goes, and that's what every investor must focus on -- not the price of oil, not the current state of global petroleum demand. What matters is not what it's selling today, but what it will sell five years from now.
"Upstream" earnings (refineries and gas stations are "downstream") accounted for $35.4 billion of Exxon's $45.2 billion in 2008 earnings. If Exxon were to begin to deplete its reserves, then it would become a vanishing asset. This is not the case, though: The company succeeded in replacing 103% of its production, adding 1.5 billion barrels of oil equivalent to its reserves. Here's how Exxon uses its cash: To buy reserves that will generate more cash. Last year it spent $26.1 billion on capital expenditures and exploration. It currently has 72 billion barrels of reserve capacity. These upstream assets require a lot of cash, but that cash earns a remarkable return -- 54% in 2008 and an average 44% during the past five years.
The earnings potential is the bottom line, and the most important thing for investors to keep in mind. I know of no other company that gets more bang for its buck. Because of this, I consider Exxon to be an outstanding long-term investment.
No. 9: Google Inc. (Nasdaq: GOOG) , $12.1 billion
If I had to pick the worst business decisions ever made, taking Google public would be near the top of my list. It's not like the company ever had any trouble raising capital: Sun Microsystems (Nasdaq: JAVA) co-founder Andy Bechtolsheim wrote Larry Page and Sergey Brin a check for $100,000 to get the entity going even before it had been incorporated. Sequoia Capital and Kleiner Perkins came through with $25 million about a year later. In 2004, the company sold 19.6 million shares for $85 each in a $1.7 billion IPO.
The company is now worth $180 billion. Page and Brin, had they kept the company private, likely would be No. 1 and No. 2 on the list of the richest people in the world, with a net worth of perhaps $80 billion each, instead of sharing 11th place, at (a paltry) $13.3 billion.
Google derives 96.8% of its revenue from advertising. And today the shares hit a 52-week high, which seems to indicate a rosy outlook for advertising. Wall Street was pleased to see that the revised unemployment figures came in lower than were previously estimated, which the market evidently interpreted as a sign the economy is turning around and that advertising will pick up.
Google is the most richly valued company of the stocks on our list. Investors are willing to pay 5.5 times net assets (or "book value") for the shares, a significant premium to the 2.2 times book value that the overall S&P 500 commands. The reason Google's price-to-book ratio is so high is the same reason its P/E ratio is high: Investors expect Google to continue to increase its earnings. And they are willing to pay $5.50 for every dollar of assets. To put that number into perspective, investors only pay $1.20 for every dollar of Berkshire Hathaway's assets, which means, at least mathematically, that Warren Buffett is only worth 20 cents to Wall Street.
Even at such a high valuation, Google looks like an awfully tempting buy. Its 2010 revenue is estimated at $26.19 per share, and even a relatively low earnings multiple of 30 implies a fair-market price of $785.70. That's about +35% above today's prices, and it's an exceedingly low estimate: These shares routinely are worth 40 times earnings, not 30.
Investors can rest assured that Google will use its cash to continue to build its business. It certainly doesn't need to use it to service debt, as the company doesn't have any. Google's primary focus going forward will be in expanding the reach of its advertising in the United States and in developing its presence in the rest of the world.
Investors who aren't afraid of tech likely would be pleased with these shares, and they won't need to commit to the long term. In the next year, these shares should roughly triple the long-term average return of the S&P 500. If you buy them, however, please hold them for at least 366 days. Not to give my prediction more time to come true, but to help you avoid some capital-gains taxes.
No. 10: Johnson & Johnson ( JNJ ) , $11.9 billion
More years ago than I care to remember, I -- a young copy editor -- walked into the deputy managing editor's office at The Star-Ledger, the largest newspaper in New Jersey and one of the best papers in the country. As much as it pains me to admit it, the guy was brilliant (he's now the executive editor) and he oversaw a great sports department and a business section that broke news in a tough market, where our competitors were The New York Times and The Wall Street Journal . I can't remember what we were initially talking about -- I suspect it was rank insubordination -- but I wound up betting him that Johnson & Johnson would miss earnings.
It didn't.
A few days later, I paid up on the modest wager, which was probably bad Chinese food from across the street, and I heard a bit of advice from my boss's boss's boss: "Don't ever bet against Johnson & Johnson. Just don't do it."
It has become one of the commandments I live my life by, along with: Never bet on a horse named after a blonde, never draw to an inside straight and never eat at place called Mom's.
Good rules, all.
Johnson & Johnson is one of the most looked-up-to companies in the world. According to the Reputation Institute, Forbes reports, J&J is the company that Americans esteem, admire and respect the most. Its composite score of 83.6 on a 100-point scale was 2.5 times higher than Kraft ( KFT ) , which took a distant second in the ranking. (Oil-field service company Halliburton ( HAL ) scored lowest out of the 153 companies ranked, and that's a bum rap. HAL's a great company. It's also up +53% so far this year.)
As I learned from my ill-fated wager, Johnson & Johnson can be counted on to deliver results. It's posted an annual earnings increase since at least 1998 and has beat Wall Street expectations for the past 15 quarters. Its earnings did not slip in the recession, which suggests an uncommon resiliency. And yet it is not a juggernaut by any stretch of the imagination: For the past four years, J&J's revenue has posted a modest +6.0% compound rate of growth. Its net earnings have fared somewhat better: They've grown at a compound rate of +6.5%. Given its immense revenues -- some $60 billion a year, this feat is not only laudable but impressive. The company maintains a 25.4% operating margin.
Johnson & Johnson makes hundreds of health-care related products, including scores of medical devices like heart stents, diagnostic tools and about two dozen prescription drugs. Its consumer line-up includes such ubiquitous products as Band-Aids and the baby powder and No More Tears shampoo that all moms use.
As Johnson & Johnson moves forward, it will deploy its cash in acquiring companies to add to its product line, which currently has only five products in late-stage clinical trials. As Big Pharma goes through a wave of mergers -- the Pfizer-Wyeth deal, Merck's acquisition of Schering-Plough -- a takeover seems ever more likely, though it might be more natural for J&J to focus on devices or diagnostics than pharmaceuticals.
Frankly, J&J needs a deal. J&J has a great reputation as a company everyone loves and it makes products we all use, but investors are ho-hum about the company's prospects. A deal might add some excitement, the sale of a division might unlock the value of a particularly dynamic business unit.
I learned my lesson, and I'm not going to bet against its earnings, but I'm not wild about J&J's stock, either. If 2010 delivers the consensus earnings estimate of $4.92, the company's fair-market value is only about $69, not much of a premium from today's $64.36. It may have a vast cash hoard, but it doesn't look like a particularly compelling buy for the New Year.
Andy Obermueller
Editor, Government-Driven Investing
Disclosure: Andy Obermueller does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2016 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Computer giant Dell (Nasdaq: DELL) , search pioneer Google (Nasdaq: GOOG) , drug maker Johnson & Johnson ( JNJ ) and petroleum titan Exxon Mobil ( XOM ) , which holds the distinction of being the most profitable company in the United States. 7: Dell Inc. (Nasdaq: DELL) , $12.8 billion Selling computers is a tough racket. The result is that Dell, the No.
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Computer giant Dell (Nasdaq: DELL) , search pioneer Google (Nasdaq: GOOG) , drug maker Johnson & Johnson ( JNJ ) and petroleum titan Exxon Mobil ( XOM ) , which holds the distinction of being the most profitable company in the United States. 7: Dell Inc. (Nasdaq: DELL) , $12.8 billion Selling computers is a tough racket. The result is that Dell, the No.
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Computer giant Dell (Nasdaq: DELL) , search pioneer Google (Nasdaq: GOOG) , drug maker Johnson & Johnson ( JNJ ) and petroleum titan Exxon Mobil ( XOM ) , which holds the distinction of being the most profitable company in the United States. 7: Dell Inc. (Nasdaq: DELL) , $12.8 billion Selling computers is a tough racket. The result is that Dell, the No.
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Computer giant Dell (Nasdaq: DELL) , search pioneer Google (Nasdaq: GOOG) , drug maker Johnson & Johnson ( JNJ ) and petroleum titan Exxon Mobil ( XOM ) , which holds the distinction of being the most profitable company in the United States. 7: Dell Inc. (Nasdaq: DELL) , $12.8 billion Selling computers is a tough racket. The result is that Dell, the No.
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a560fbb5-153a-49fa-92c7-b9c74bd3aa83
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727054.0
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2009-12-02 00:00:00 UTC
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Share the Wealth with These Top 10 Keepers of Cash
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DELL
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https://www.nasdaq.com/articles/share-wealth-these-top-10-keepers-cash-2009-12-02
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nan
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nan
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Cash, they say, is king.
If that's true -- and after the financial crisis we can all agree that it is -- then these 10 companies must be the masters of the universe.
Company (Ticker)Cash/Near Cash GE F MRK HPQ XOM JNJ
Each of these blue-chip companies has more than $10 billion in the cash and near-cash line on its balance sheet. Together, their collective cash hoard is a staggering $214.6 billion.
To put that number in perspective, $215 billion would buy each and every resident of Atlanta a $325,000 house AND a new Cadillac Escalade.
Not only is the cash line on the balance sheet strong, the bottom line of the income statement is also robust. What's more, the likelihood of these companies continuing to post massive profits in the future is very high. Consider: In the 90 days that made up the third quarter this year, these 10 companies earned a profit of $22.3 billion. In other words, even in a down economy mired in recession, these astonishing businesses collectively made more than $100 million in profit every hour of every day, seven days a week.
The question, of course, is whether these cash-rich companies are good investments. Today, we'll look at the top two companies, and follow up with the seven remaining companies on Thursday and Friday.
No. 1: General Electric Co. ( GE ) , $61.4 billion
For experienced investors, General Electric is the House that Jack Built. Jack Welch, the conglomerate's CEO from 1981 to 2001, took a stodgy industrial manufacturer and turned it into one of the leaders in power generation, health care and financial services. Welch wanted GE to be No. 1 or No. 2 in every business in which it participated, and managers either met that goal or they went to work somewhere else. Now, the company is lead by Welch's hand-picked successor, Jeffrey Immelt, and it occupies much the same vaunted position. The case can be made, and made compellingly, that GE is a proxy for the overall U.S. economy.
As any student of Machiavelli will tell you, a company's greatest strength is also its greatest weakness. And when the financial panic hit, GE was one of the companies that bore the brunt of the blow. In early March of this year, as the market circled the bowl and the Dow plunged to a gut-checking 6,500, things looked very bad for GE, which derived a significant source of its revenue by making loans that many of its customers suddenly looked unable to repay.
The falloff was dramatic. In December 2008, GE shares were trading at about $20. By March 4th, they'd fallen to a low of $5.73, a loss of more than -70%.
That was then.
When -- and to some degree before -- the financial crisis struck in early fall of 2008, GE took a number of unusual steps to avert sure and certain financial Armageddon.
First, it sold stock to raise cash. The move was extraordinarily well timed: The company sold 547.8 million shares at $22.25 each on Oct. 8, 2008, which brought in $12 billion.
At about the same time, GE also accepted a $3 billion loan from Warren Buffett. GE might have thought its underwriters charged steep fees to sell its shares, but their cut was nothing compared with the terms Buffett exacted on his loan: Perpetual preferred stock that pays a 10% dividend and can only be bought back after three years -- and even then only at a 10% premium. Buffett also received warrants to buy $3 billion worth of common stock within the next five years.
In the meantime, the federal government stepped in to guarantee some of GE's debt, a program the company has since started weaning itself from as investors started showing they were once again willing to shoulder some measure of the risk. That a company with a long-standing AAA credit rating from Standard & Poor's needed a guarantee underscored the severity of the financial crisis. For a brief interlude, the composite rating on the triple-A bond shot up above 10% and investors practically gave GE debt away, pushing its bond prices to bargain-basement levels. S&P cut its rating; GE cut its dividend and the Dow began to climb out of the gutter.
These moves collectively allowed GE to stay afloat. Its shares have since rebounded to about $16, which values the company at about 12 times earnings. That's a discount from its historical average of 16.2 and well below the S&P 500's composite earnings multiple of 22.2.
GE, which remains profitable, is on track to earn $1.00 a share this year, a massive -48.2% decrease from the year before. Immelt has signaled that the company will actively seek huge government projects and thinks they will mean $192 billion to the company during the next three years. The consensus estimate for 2010 is a ridiculously low $0.90 a share. I think earnings of between $1.25 and $1.50 are far more likely as the economy rebounds and Immelt brings in government contracts. If management can indeed deliver those kinds of results, Wall Street will be reminded of the earning machine that GE has traditionally been, and I think its P/E will rise to its typical 20. This, to my way of thinking, implies a 12-month price target of $30. With that in mind, and continued growth from there back to the company's historical revenue and earnings levels, I think the shares could be an exceptionally strong long-term buy.
So does Warren Buffett.
His warrants allow him to buy $3 billion worth of stock within five years. But the key to a warrant isn't the time frame, it's the exercise price. Buffett can buy stock at $22.25 a share, which means he clearly thinks the stock's value will be well above that by the time the warrants expire in 2013.
Investors interested in following Buffett's lead can do so by adding these shares to their portfolio and just letting them sit. My prediction: Buffett will exercise that warrant and double his money, and investors who buy now will do even better.
No: 2: Berkshire Hathaway (NYSE: BRK-A) , $26.9 billion
One of Warren Buffett's most endearing qualities is the way he phrases things. The guy is the king of the understatement. In a shareholder letter years ago Buffett said something to the effect of, "We always keep plenty of cash on hand." That's like saying Andy Roddick generally serves hard. Plenty of cash on hand? How does $26.9 billion strike you?
Debt, as Buffett would tell you, always limits options. Cash always creates opportunities. It can allow a company to weather a storm and survive when its competitors can't. It can mean a business doesn't need to seek outside financing to pursue a new opportunity. And if you want to ensure a deal goes through, showing up with cash is a good opening salvo.
Berkshire Hathaway, Buffett's holding company, owns insurance companies and utilities. It also has a host of subsidiary businesses that Buffett has bought over the years, from NetJets to DairyQueen and Fruit of the Loom. Berkshire also has immense stakes in about a score of public companies, including Wells Fargo ( WFC ) , Coca-Cola ( KO ) and American Express ( AXP ) . Buffett, who had been buying up railroad stocks, recently bought No. 2 U.S. railroad Burlington Northern Santa Fe ( BNI ) .
Buffett's record, over time, speaks for itself. The first item in the annual report is always the same: The change in the company's book value, or shareholder equity, which he compares to the total return of the S&P 500. Buffett's growth in book value since he took over Berkshire in 1964 has been +362,319% versus a gain of +4,276% in the S&P. He has warned that such outsize growth simply cannot continue -- as the law of large numbers finally caught up with him -- but he still does a pretty good job of making money for his shareholders, and he and his partner Charlie Munger are two of the smartest and savviest businessmen in the world.
That's all well and good, but what's really going to make the difference this year to Berkshire Hathaway is its first split. As part of the Burlington deal, the company is engineering a 50-for-1 split. Owners who now have one share of B worth $3,400 will soon have 50 shares worth $68. (50 times $68 = $3,400.) While this doesn't erase or create any wealth in and of itself -- as the market cap stays exactly the same -- the move will likely create a run on Berkshire. This is a good thing: Berkshire grows. It makes money. And it has the best management in the world. There's no earthly reason it should trade at a -20% discount to the S&P. One of the reasons Wall Street has a hard time unlocking the value of this company is its arbitrarily high share price. The split will correct that.
Why? Because everyone who invests wants a piece of Buffett in his portfolio. For most investors, though, he's long been out of reach. A single share of B represents a sizable chunk of change, and an "A" share, currently selling for about $100,000, exceeds the equity many investors have in their homes. But that's changing. After the split, a round lot of Berkshire -- that is, 100 shares -- will require the same capital as a similar stake in United Technologies ( UTX ) or Nike ( NKE ) . I think Berkshire will rise to $100 a share on this demand alone.
That's not a bad reason to jump on the Berkshire bandwagon, but it might be short-sighted. Its cash hoard, on the other hand, is a great reason. No one has ever put cash to work more effectively than Buffett. That's a point he has conclusively proven with the aforementioned GE loan, a similar deal with Goldman Sachs ( GS ) , and his recent stake in lithium-ion battery pioneer BYD Corp, which has risen +825% since he bought the stock in fall 2008.
Do I think Berkshire is a buy? Absolutely.
On Thursday, we'll look at the next four companies on the list.
Andy Obermueller
Editor, Government-Driven Investing
Disclosure: Andy Obermueller does not own shares of any security mentioned in this article.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
© Copyright 2001-2016 StreetAuthority, LLC. All Rights Reserved.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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GE might have thought its underwriters charged steep fees to sell its shares, but their cut was nothing compared with the terms Buffett exacted on his loan: Perpetual preferred stock that pays a 10% dividend and can only be bought back after three years -- and even then only at a 10% premium. He has warned that such outsize growth simply cannot continue -- as the law of large numbers finally caught up with him -- but he still does a pretty good job of making money for his shareholders, and he and his partner Charlie Munger are two of the smartest and savviest businessmen in the world. That's a point he has conclusively proven with the aforementioned GE loan, a similar deal with Goldman Sachs ( GS ) , and his recent stake in lithium-ion battery pioneer BYD Corp, which has risen +825% since he bought the stock in fall 2008.
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1: General Electric Co. ( GE ) , $61.4 billion For experienced investors, General Electric is the House that Jack Built. With that in mind, and continued growth from there back to the company's historical revenue and earnings levels, I think the shares could be an exceptionally strong long-term buy. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. © Copyright 2001-2016 StreetAuthority, LLC.
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Company (Ticker)Cash/Near Cash GE F MRK HPQ XOM JNJ Each of these blue-chip companies has more than $10 billion in the cash and near-cash line on its balance sheet. Immelt has signaled that the company will actively seek huge government projects and thinks they will mean $192 billion to the company during the next three years. Berkshire Hathaway, Buffett's holding company, owns insurance companies and utilities.
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Buffett, who had been buying up railroad stocks, recently bought No. That's all well and good, but what's really going to make the difference this year to Berkshire Hathaway is its first split. Do I think Berkshire is a buy?
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5e72c4b0-f664-40ce-9f97-6b3709f80713
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727055.0
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2009-10-26 00:00:00 UTC
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Why Is the Market Going Up When Jobs Are Going Down?
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DELL
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https://www.nasdaq.com/articles/why-market-going-when-jobs-are-going-down-2009-10-26
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nan
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nan
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Invest With An Edge submits:
By Brandon Clay
Last month the national unemployment average rose to 9.8%. It's actually at 17% if you count distressed and underemployed workers. Not only is unemployment data weak, it's getting worse. Former Fed chairman Alan Greenspan said unemployment would hit at least 10% before turning back.
Even with this well-known data, the market is going up. The S&P 500 is sporting a mostly gentle uptrend from March to October. The market thinks we're recovering. Bernanke and company have said as much. However, given that we have the toughest job market in a generation, to me it seems a little premature to declare recovery - at least a strong one.
I'm not alone in my assessment. CNNMoney.com's Editor At Large Paul LaMonica recently said, "Repeat after us. There is no strong recovery without job growth. There is no strong recovery without job growth. Why does Wall Street not get that?"
A good question. Why is the market going up while jobs are going down?
It makes even less sense when you consider the nature of unemployment. It goes back to demand. When companies experience demand for their products and services, they will seek to meet that demand. If meeting that demand requires more labor, they will hire. It's ECON 101. If companies hire, then unemployment goes down. People return to Starbucks to order their Double Skinny Lattes.
But that's not what is happening. Instead, companies are cutting jobs. Why does the market go up while this is happening?
To this humble market observer, it seems that most of the buying pressure is coming from earnings. Quarterly profits have been good, often better than expected, primarily driven from falling operating expenses. Operating expenses are falling because many large companies are…you guessed it…cutting jobs. There are other factors, but job cuts are definitely helping the bottom line.
In recent days, Sun Microsystems ( JAVA ), The New York Times ( NYT ), Dell ( DELL ), St. Jude Medical ( STJ ) all shed jobs to stabilize their businesses. And these companies aren't even banks. We just crossed the 100 barrier for failed banks in the US this year. I'm not sure where all those employees have gone, but they aren't helping keep unemployment rolls under 10%.
Despite the slumping jobs market and rising stock market, I am often reminded of economist John Maynard Keynes' aphorism. "The market can stay irrational longer than you can solvent." This may be one of those times.
See also What Happens If Roubini Is Right? on seekingalpha.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent days, Sun Microsystems ( JAVA ), The New York Times ( NYT ), Dell ( DELL ), St. Jude Medical ( STJ ) all shed jobs to stabilize their businesses. Invest With An Edge submits: By Brandon Clay Last month the national unemployment average rose to 9.8%. Former Fed chairman Alan Greenspan said unemployment would hit at least 10% before turning back.
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In recent days, Sun Microsystems ( JAVA ), The New York Times ( NYT ), Dell ( DELL ), St. Jude Medical ( STJ ) all shed jobs to stabilize their businesses. Operating expenses are falling because many large companies are…you guessed it…cutting jobs. on seekingalpha.com The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In recent days, Sun Microsystems ( JAVA ), The New York Times ( NYT ), Dell ( DELL ), St. Jude Medical ( STJ ) all shed jobs to stabilize their businesses. Why is the market going up while jobs are going down? Operating expenses are falling because many large companies are…you guessed it…cutting jobs.
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In recent days, Sun Microsystems ( JAVA ), The New York Times ( NYT ), Dell ( DELL ), St. Jude Medical ( STJ ) all shed jobs to stabilize their businesses. Why is the market going up while jobs are going down? If companies hire, then unemployment goes down.
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a7beaad2-65f1-4d1c-bf82-13d1c00fa91b
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727056.0
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2023-11-14 00:00:00 UTC
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DEM Crosses Above Key Moving Average Level
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DEM
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https://www.nasdaq.com/articles/dem-crosses-above-key-moving-average-level
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nan
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nan
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $38.21, changing hands as high as $38.58 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 2.4% on the day. The chart below shows the one year performance of DEM shares, versus its 200 day moving average:
Looking at the chart above, DEM's low point in its 52 week range is $34.70 per share, with $40.86 as the 52 week high point — that compares with a last trade of $38.55.
Click here to find out which 9 other ETFs recently crossed above their 200 day moving average »
Also see:
CTOS shares outstanding history
QI Historical Stock Prices
JAZZ shares outstanding history
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $34.70 per share, with $40.86 as the 52 week high point — that compares with a last trade of $38.55. In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $38.21, changing hands as high as $38.58 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 2.4% on the day.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $38.21, changing hands as high as $38.58 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $34.70 per share, with $40.86 as the 52 week high point — that compares with a last trade of $38.55. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 2.4% on the day.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $38.21, changing hands as high as $38.58 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $34.70 per share, with $40.86 as the 52 week high point — that compares with a last trade of $38.55. Click here to find out which 9 other ETFs recently crossed above their 200 day moving average » Also see: CTOS shares outstanding history QI Historical Stock Prices JAZZ shares outstanding history The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $38.21, changing hands as high as $38.58 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $34.70 per share, with $40.86 as the 52 week high point — that compares with a last trade of $38.55. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 2.4% on the day.
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f90a0536-dfa1-4177-9444-32bb08319ccc
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727057.0
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2023-10-26 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-11
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nan
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nan
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
The fund is managed by Wisdomtree. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs. Before fees and expenses, this particular fund seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 6.43%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
Looking at individual holdings, Vale Sa (VALE3) accounts for about 4.99% of total assets, followed by Petroleo Brasileiro Sa (PETR3) and Mediatek Inc.
DEM's top 10 holdings account for about 28.36% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Emerging Markets High Dividend ETF return is roughly 7.91% so far, and was up about 18.93% over the last 12 months (as of 10/26/2023). DEM has traded between $32.14 and $40.83 in this past 52-week period.
The ETF has a beta of 0.75 and standard deviation of 16.13% for the trailing three-year period, making it a medium risk choice in the space. With about 442 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $66.75 billion in assets, Vanguard FTSE Emerging Markets ETF has $67.96 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
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WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs. Looking at individual holdings, Vale Sa (VALE3) accounts for about 4.99% of total assets, followed by Petroleo Brasileiro Sa (PETR3) and Mediatek Inc. DEM's top 10 holdings account for about 28.36% of its total assets under management.
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Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. DEM has been able to amass assets over $2.44 billion, making it one of the larger ETFs in the Broad Developed Market ETFs. Looking at individual holdings, Vale Sa (VALE3) accounts for about 4.99% of total assets, followed by Petroleo Brasileiro Sa (PETR3) and Mediatek Inc. DEM's top 10 holdings account for about 28.36% of its total assets under management.
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1117121d-232a-43cb-9b83-d9280b008ead
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727058.0
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2023-09-25 00:00:00 UTC
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Notable Two Hundred Day Moving Average Cross - DEM
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DEM
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https://www.nasdaq.com/articles/notable-two-hundred-day-moving-average-cross-dem
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nan
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nan
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed below their 200 day moving average of $38.16, changing hands as low as $37.69 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 3.5% on the day. The chart below shows the one year performance of DEM shares, versus its 200 day moving average:
Looking at the chart above, DEM's low point in its 52 week range is $31.80 per share, with $40.86 as the 52 week high point — that compares with a last trade of $37.76.
Click here to find out which 9 other ETFs recently crossed below their 200 day moving average »
Also see:
Top Stocks Held By Leon Cooperman
Institutional Holders of REZ
Institutional Holders of RHRX
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $31.80 per share, with $40.86 as the 52 week high point — that compares with a last trade of $37.76. In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed below their 200 day moving average of $38.16, changing hands as low as $37.69 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 3.5% on the day.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed below their 200 day moving average of $38.16, changing hands as low as $37.69 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $31.80 per share, with $40.86 as the 52 week high point — that compares with a last trade of $37.76. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 3.5% on the day.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed below their 200 day moving average of $38.16, changing hands as low as $37.69 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $31.80 per share, with $40.86 as the 52 week high point — that compares with a last trade of $37.76. Click here to find out which 9 other ETFs recently crossed below their 200 day moving average » Also see: Top Stocks Held By Leon Cooperman Institutional Holders of REZ Institutional Holders of RHRX The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed below their 200 day moving average of $38.16, changing hands as low as $37.69 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $31.80 per share, with $40.86 as the 52 week high point — that compares with a last trade of $37.76. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 3.5% on the day.
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013d3c58-e4bd-4bbd-b774-454a8425f304
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727059.0
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2023-08-21 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-10
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nan
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nan
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Even though this space provides many choices to investors--think one of the simplest methodologies like equal-weighting and more complicated ones like fundamental and volatility/momentum based weighting--not all have been able to deliver first-rate results.
Fund Sponsor & Index
DEM is managed by Wisdomtree, and this fund has amassed over $2.47 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 7.34%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Looking at individual holdings, Vale Sa (VALE3) accounts for about 5.64% of total assets, followed by Mediatek Inc and Petroleo Brasileiro Sa (PETR3).
Performance and Risk
Year-to-date, the WisdomTree Emerging Markets High Dividend ETF return is roughly 7.88% so far, and is up about 8.03% over the last 12 months (as of 08/21/2023). DEM has traded between $32.14 and $40.83 in this past 52-week period.
The ETF has a beta of 0.75 and standard deviation of 16.13% for the trailing three-year period, making it a medium risk choice in the space. With about 458 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $69.65 billion in assets, Vanguard FTSE Emerging Markets ETF has $71.43 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.47 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
|
Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.47 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs.
|
The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.47 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs.
|
The WisdomTree Emerging Markets High Dividend ETF (DEM) made its debut on 07/13/2007, and is a smart beta exchange traded fund that provides broad exposure to the Broad Developed Market ETFs category of the market. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.47 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
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b1c9ca87-83f7-47d4-aee1-2e9153d8299a
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727060.0
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2023-08-16 00:00:00 UTC
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4 ETFs For Investors Looking For International Dividends
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DEM
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https://www.nasdaq.com/articles/4-etfs-for-investors-looking-for-international-dividends
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nan
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nan
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With so much uncertainty remaining around the Fed's rate cycle and the potential for recession, many investors are beginning to look toward international equity markets for the means to build income. Yields continue to look attractive for international dividend ETFs, in particular.
International high dividend ETFs are funds that hold overseas companies whose dividend payouts have been consistently high (high dividend yield) or which have consistently grown over time (dividend appreciation). In this article, we exam
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With so much uncertainty remaining around the Fed's rate cycle and the potential for recession, many investors are beginning to look toward international equity markets for the means to build income. Yields continue to look attractive for international dividend ETFs, in particular. International high dividend ETFs are funds that hold overseas companies whose dividend payouts have been consistently high (high dividend yield) or which have consistently grown over time (dividend appreciation).
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With so much uncertainty remaining around the Fed's rate cycle and the potential for recession, many investors are beginning to look toward international equity markets for the means to build income. Yields continue to look attractive for international dividend ETFs, in particular. International high dividend ETFs are funds that hold overseas companies whose dividend payouts have been consistently high (high dividend yield) or which have consistently grown over time (dividend appreciation).
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With so much uncertainty remaining around the Fed's rate cycle and the potential for recession, many investors are beginning to look toward international equity markets for the means to build income. International high dividend ETFs are funds that hold overseas companies whose dividend payouts have been consistently high (high dividend yield) or which have consistently grown over time (dividend appreciation). In this article, we exam
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With so much uncertainty remaining around the Fed's rate cycle and the potential for recession, many investors are beginning to look toward international equity markets for the means to build income. Yields continue to look attractive for international dividend ETFs, in particular. International high dividend ETFs are funds that hold overseas companies whose dividend payouts have been consistently high (high dividend yield) or which have consistently grown over time (dividend appreciation).
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43938269-9536-4e1c-8c95-b68e9b89d3bf
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727061.0
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2023-06-13 00:00:00 UTC
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EXCLUSIVE-VTB to sell one of Russia's biggest grain traders, Demetra-Holding, CEO Kostin says
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DEM
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https://www.nasdaq.com/articles/exclusive-vtb-to-sell-one-of-russias-biggest-grain-traders-demetra-holding-ceo-kostin-0
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nan
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nan
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Repeats story first published on Friday, text unchanged
MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview.
Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
VTB has a 45% stake in the holding.
"We're coming out of there. It's decided," Kostin told Reuters. "We have been out of control for a long time, and we will leave completely."
He said the asset would be sold this year.
When asked if buyers had been found, he said: "Yes, and even, maybe, there will be not only Russian ones, we'll see."
He declined to say who the buyers were but clarified that they would be from "friendly" countries - a word Russia uses to describe countries which have not imposed sanctions on Russia.
When asked if billionaire Vadim Moshkovich was a bidder, Kostin said: "No."
Asked if it could be the Chinese, Kostin said: "Why China? We have lots of friends, more than 100 countries did not support the anti-Russian sanctions, so we will choose one of them."
Kostin said VTB saw few prospects for itself in the grain business, adding that a sanctioned bank in the shareholding hindered the holding.
(Reporting by Guy Faulconbridge and Elena Fabrichnaya)
((guy.faulconbridge@thomsonreuters.com; Telephone +79856400243;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Repeats story first published on Friday, text unchanged MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. We have lots of friends, more than 100 countries did not support the anti-Russian sanctions, so we will choose one of them."
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Repeats story first published on Friday, text unchanged MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
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Repeats story first published on Friday, text unchanged MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
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Repeats story first published on Friday, text unchanged MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
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b2c111fa-8499-4c75-ae23-3f6b5a59642f
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727062.0
|
2023-06-09 00:00:00 UTC
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EXCLUSIVE-VTB to sell one of Russia's biggest grain traders, Demetra-Holding, CEO Kostin says
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DEM
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https://www.nasdaq.com/articles/exclusive-vtb-to-sell-one-of-russias-biggest-grain-traders-demetra-holding-ceo-kostin-says
|
nan
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nan
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MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview.
Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
VTB has a 45% stake in the holding.
"We're coming out of there. It's decided," Kostin told Reuters. "We have been out of control for a long time, and we will leave completely."
He said the asset would be sold this year.
When asked if buyers had been found, he said: "Yes, and even, maybe, there will be not only Russian ones, we'll see."
He declined to say who the buyers were but clarified that they would be from "friendly" countries - a word Russia uses to describe countries which have not imposed sanctions on Russia.
When asked if billionaire Vadim Moshkovich was a bidder, Kostin said: "No."
Asked if it could be the Chinese, Kostin said: "Why China? We have lots of friends, more than 100 countries did not support the anti-Russian sanctions, so we will choose one of them."
Kostin said VTB saw few prospects for itself in the grain business, adding that a sanctioned bank in the shareholding hindered the holding.
(Reporting by Guy Faulconbridge and Elena Fabrichnaya)
((guy.faulconbridge@thomsonreuters.com; Telephone +79856400243;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. We have lots of friends, more than 100 countries did not support the anti-Russian sanctions, so we will choose one of them."
|
MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
|
MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
|
MOSCOW, June 9 (Reuters) - VTB, Russia's second largest bank, will sell its stake in one of Russia's biggest grain traders, Demetra-Holding, and is in negotiations with both Russian and foreign buyers, CEO Andrei Kostin told Reuters in an interview. Demetra has a network of grain elevators, major deep sea grain terminals and its own logistics. It owns a non controlling stake in major grain trader United Grain Company (OZK).
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f95d8b03-4f8b-42bc-8657-ed5395f4f186
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727063.0
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2023-06-05 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-9
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nan
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nan
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Developed Market ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
DEM is managed by Wisdomtree, and this fund has amassed over $2.30 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
The fund has a 12-month trailing dividend yield of 7.28%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Looking at individual holdings, Vale Sa (VALE3) accounts for about 5.64% of total assets, followed by Mediatek Inc and Petroleo Brasileiro Sa (PETR3).
DEM's top 10 holdings account for about 28.06% of its total assets under management.
Performance and Risk
Year-to-date, the WisdomTree Emerging Markets High Dividend ETF has added about 8.19% so far, and is down about -1.70% over the last 12 months (as of 06/05/2023). DEM has traded between $32.14 and $41.44 in this past 52-week period.
The ETF has a beta of 0.75 and standard deviation of 16.66% for the trailing three-year period, making it a medium risk choice in the space. With about 458 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Developed Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $70.45 billion in assets, Vanguard FTSE Emerging Markets ETF has $71.73 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Developed Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Developed Market ETFs category of the market. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.30 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
|
Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Developed Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.30 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs.
|
Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Developed Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.30 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Developed Market ETFs category of the market. Fund Sponsor & Index DEM is managed by Wisdomtree, and this fund has amassed over $2.30 billion, which makes it one of the larger ETFs in the Broad Developed Market ETFs. Operating expenses on an annual basis are 0.63% for DEM, making it on par with most peer products in the space.
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050b14f1-d7b1-48c9-92a3-0463c4c6391a
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727064.0
|
2023-04-26 00:00:00 UTC
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2 Options to Boost Income and Get EM Diversification
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DEM
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https://www.nasdaq.com/articles/2-options-to-boost-income-and-get-em-diversification
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nan
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nan
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While the Federal Reserve looks to keep inflation in check with interest rate hikes, it's keeping fixed income investors on their toes. In order to extract more income, it will take a higher tolerance for risk, offering opportunities in emerging markets (EM).
Using the MSCI Emerging Markets Index as a gauge, EM was certainly off to a roaring start, jumping up to 10% in the final week of January. Since then, inflation fears have started to creep back into investor sentiment, and the index has come down since with a year-to-date gain of just above 2%.
"A turbulent end of the easy-money era has deflated expectations for a boom year for battered emerging market assets," a Bloomberg article noted.
Still, that doesn't mean investors should shy away from EM assets at a time when inflation is high and the strength and safety of the dollar are prevailing over other riskier assets. There are many opportunities in EM if investors know where to look and if economic conditions improve as 2023 continues.
"Brought down to earth by a volatile first quarter, the much-hyped EM investment story for 2023 is turning into one of resilience and hopes for decent returns — that is if fundamentals, not contagion risk, drive flows," the article added.
High Yielding Options From EM
Fixed income investors looking to extract maximum yield and still get the diversification that EM assets offer can look to the WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS). In terms of their 30-day SEC yields, DEM offers about 8% and DGS offers 5%, as of April 21.
Per its fund description, DEM seeks to track the investment results of high dividend-yielding companies in the emerging markets region. EM also offers opportunities for investors looking for growth-fueled plays as well as income, which DEM has.
As for DGS, it seeks to track the investment results of dividend-paying small-cap companies in the emerging markets region. That same growth potential is also found in this fund with its focus on small-cap companies.
Top country allocations in DEM include Taiwan, China, and Brazil (comprising about 70% of the fund). DGS offers exposure to primarily Taiwan, China, and South Korea (close to 60% of the fund).
The diversification also extends to the number of holdings in both funds. DEM has over 450, while DGS boasts over 900 holdings, preventing over-concentration in certain stocks.
For more news, information, and analysis, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Per its fund description, DEM seeks to track the investment results of high dividend-yielding companies in the emerging markets region. High Yielding Options From EM Fixed income investors looking to extract maximum yield and still get the diversification that EM assets offer can look to the WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS). In terms of their 30-day SEC yields, DEM offers about 8% and DGS offers 5%, as of April 21.
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High Yielding Options From EM Fixed income investors looking to extract maximum yield and still get the diversification that EM assets offer can look to the WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS). Per its fund description, DEM seeks to track the investment results of high dividend-yielding companies in the emerging markets region. In terms of their 30-day SEC yields, DEM offers about 8% and DGS offers 5%, as of April 21.
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High Yielding Options From EM Fixed income investors looking to extract maximum yield and still get the diversification that EM assets offer can look to the WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS). Per its fund description, DEM seeks to track the investment results of high dividend-yielding companies in the emerging markets region. In terms of their 30-day SEC yields, DEM offers about 8% and DGS offers 5%, as of April 21.
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High Yielding Options From EM Fixed income investors looking to extract maximum yield and still get the diversification that EM assets offer can look to the WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS). EM also offers opportunities for investors looking for growth-fueled plays as well as income, which DEM has. In terms of their 30-day SEC yields, DEM offers about 8% and DGS offers 5%, as of April 21.
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2f8a3489-da82-484f-9f9b-04a1a5fcb8a4
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727065.0
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2023-04-05 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-8
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nan
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nan
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $2.16 billion, which makes it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index before fees and expenses.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 7.35%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H.
Performance and Risk
So far this year, DEM return is roughly 7.18%, and is down about -9.01% in the last one year (as of 04/05/2023). During this past 52-week period, the fund has traded between $32.14 and $44.20.
The fund has a beta of 0.75 and standard deviation of 17.54% for the trailing three-year period, which makes DEM a medium risk choice in this particular space. With about 458 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $70.08 billion in assets, Vanguard FTSE Emerging Markets ETF has $72.19 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The fund has a beta of 0.75 and standard deviation of 17.54% for the trailing three-year period, which makes DEM a medium risk choice in this particular space. Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H. Performance and Risk So far this year, DEM return is roughly 7.18%, and is down about -9.01% in the last one year (as of 04/05/2023).
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H. Performance and Risk So far this year, DEM return is roughly 7.18%, and is down about -9.01% in the last one year (as of 04/05/2023).
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H. Performance and Risk So far this year, DEM return is roughly 7.18%, and is down about -9.01% in the last one year (as of 04/05/2023).
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H. Performance and Risk So far this year, DEM return is roughly 7.18%, and is down about -9.01% in the last one year (as of 04/05/2023). The fund has a beta of 0.75 and standard deviation of 17.54% for the trailing three-year period, which makes DEM a medium risk choice in this particular space.
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c5761d21-b597-4f98-a7f0-b703ad3537ac
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727066.0
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2023-03-06 00:00:00 UTC
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Diversify Risk Factors With Small Cap Strategies
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DEM
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https://www.nasdaq.com/articles/diversify-risk-factors-with-small-cap-strategies
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nan
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nan
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Most investors know an asset class “performance quilt” when they see one – but they may not be as familiar with another powerful lens into understanding market risk, and risk factor diversification. A popular approach at WisdomTree Investments, risk factor diversification involves more than just simple diversification across types of investments, but across risk factors like value, growth, and quality – with small cap strategies one way to balance those factors in the weeks ahead.
Understanding risk factors in 2023 means looking back to 2022 when growth was thrown from its high perch as the Fed began its rate hike campaign. It was one of the “greatest factor rotations in history” according to WisdomTree’s chief investment officer for model portfolios, Scott Welch, in which the difference in performance between growth and value factors grew to one of the widest recorded dispersions between factors.
The challenge in 2023 is that the factors are all over the place – one week, the Fed has been tamed and inflation is in the rearview with a soft landing – or no landing at all – in the cards. In the next week, the Fed comes out with talons bared, and the market shifts back towards strategies to take cover for more rates – as many as three could be coming this year.
Despite the scramble to identify the true market zeitgeist among the various factors, investors can consider the folks over at WisdomTree are sticking to value and dividends given that factor rotations tend to last more than just a single year despite the volatility. Small-cap strategies with a value tilt may be worth checking out.
“Despite the narrowing of the gap between large- and small-cap valuations, small caps remain attractively valued on a comparative basis,” Welch wrote in a recent insight from the shop.
As such, investors wanting to lean on a strategy for the new factor regime of value and dividends with a strategy like the WisdomTree Europe SmallCap Dividend Fund (DFE) which tracks the WisdomTree Europe SmallCap Dividend Index for a fee of 58 basis points and invests in small-cap European stocks with a value tilt and dividend weighting methodology. DFE has returned 11% YTD and seen $50.6 million in one month's net inflows.
With other strategies tied to value and dividends such as AI-powered value funds like the WisdomTree U.S. AI Enhanced Value Fund (AIVL) and emerging markets dividends in the WisdomTree Emerging Markets High Dividend Fund (DEM), understanding the value of a risk factor view compared to standard asset class diversification can be a powerful tool in the weeks ahead.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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With other strategies tied to value and dividends such as AI-powered value funds like the WisdomTree U.S. AI Enhanced Value Fund (AIVL) and emerging markets dividends in the WisdomTree Emerging Markets High Dividend Fund (DEM), understanding the value of a risk factor view compared to standard asset class diversification can be a powerful tool in the weeks ahead. Understanding risk factors in 2023 means looking back to 2022 when growth was thrown from its high perch as the Fed began its rate hike campaign. Despite the scramble to identify the true market zeitgeist among the various factors, investors can consider the folks over at WisdomTree are sticking to value and dividends given that factor rotations tend to last more than just a single year despite the volatility.
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With other strategies tied to value and dividends such as AI-powered value funds like the WisdomTree U.S. AI Enhanced Value Fund (AIVL) and emerging markets dividends in the WisdomTree Emerging Markets High Dividend Fund (DEM), understanding the value of a risk factor view compared to standard asset class diversification can be a powerful tool in the weeks ahead. A popular approach at WisdomTree Investments, risk factor diversification involves more than just simple diversification across types of investments, but across risk factors like value, growth, and quality – with small cap strategies one way to balance those factors in the weeks ahead. As such, investors wanting to lean on a strategy for the new factor regime of value and dividends with a strategy like the WisdomTree Europe SmallCap Dividend Fund (DFE) which tracks the WisdomTree Europe SmallCap Dividend Index for a fee of 58 basis points and invests in small-cap European stocks with a value tilt and dividend weighting methodology.
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With other strategies tied to value and dividends such as AI-powered value funds like the WisdomTree U.S. AI Enhanced Value Fund (AIVL) and emerging markets dividends in the WisdomTree Emerging Markets High Dividend Fund (DEM), understanding the value of a risk factor view compared to standard asset class diversification can be a powerful tool in the weeks ahead. A popular approach at WisdomTree Investments, risk factor diversification involves more than just simple diversification across types of investments, but across risk factors like value, growth, and quality – with small cap strategies one way to balance those factors in the weeks ahead. As such, investors wanting to lean on a strategy for the new factor regime of value and dividends with a strategy like the WisdomTree Europe SmallCap Dividend Fund (DFE) which tracks the WisdomTree Europe SmallCap Dividend Index for a fee of 58 basis points and invests in small-cap European stocks with a value tilt and dividend weighting methodology.
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With other strategies tied to value and dividends such as AI-powered value funds like the WisdomTree U.S. AI Enhanced Value Fund (AIVL) and emerging markets dividends in the WisdomTree Emerging Markets High Dividend Fund (DEM), understanding the value of a risk factor view compared to standard asset class diversification can be a powerful tool in the weeks ahead. A popular approach at WisdomTree Investments, risk factor diversification involves more than just simple diversification across types of investments, but across risk factors like value, growth, and quality – with small cap strategies one way to balance those factors in the weeks ahead. As such, investors wanting to lean on a strategy for the new factor regime of value and dividends with a strategy like the WisdomTree Europe SmallCap Dividend Fund (DFE) which tracks the WisdomTree Europe SmallCap Dividend Index for a fee of 58 basis points and invests in small-cap European stocks with a value tilt and dividend weighting methodology.
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ba599e05-6ddc-4cd1-8e79-bdbf115c5e97
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727067.0
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2023-02-24 00:00:00 UTC
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Buoy Your Portfolio With EM Dividends in DEM
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DEM
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https://www.nasdaq.com/articles/buoy-your-portfolio-with-em-dividends-in-dem
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nan
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nan
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Had enough of the hard landing, soft landing, “no” landing talk? With just a few more data points coming in for the Fed before the bank acts, investors would be justified in feeling uncertain about where to go in the markets. One area that invites further attention may not even be in the U.S. market itself, with emerging markets (EM) starting the year with a positive rally; specifically, it may be time for EM dividends, given near-record yields in the WisdomTree Emerging Markets High Dividend Fund (DEM).
Emerging markets have benefitted already this year from having largely taken their rate hike medicine when inflation first reared its ugly head for them earlier in the pandemic. Add in an attractive valuation picture compared to a superheated U.S. market with historically underrated economic size compared to their financial markets, and EM equities grow in appeal.
In this case, EM dividends in particular can not only offer exposure to those emerging markets, but also the added benefit of current income -- and in DEM, that income is hitting yields not seen since the 2008 financial crisis. DEM is showing a 10.6% backward-looking yield, according to WisdomTree’s Digital Portfolio Tool, with its main threat being the unlikely prospect of the dollar strengthening even further.
DEM tracks the WisdomTree Emerging Markets Equity Income Index and charges 63 basis points for its use of a fundamental weighting system and its value tilt. DEM has added $133 million in just the last month, according to VettaFi, with $23 million in the last five days. DEM has outperformed its ETF Database category average and its FactSet segment average on a YTD basis as well, returning 5.2% in that time.
DEM hit its five-year mark last summer, with the ETF recently surpassing $2 billion in AUM. There are some other interesting areas in foreign equities and dividends to watch in addition to EM dividends, but with the wide breadth of dividend-paying firms available around the world in DFE, it remains a notable fund to watch.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Emerging markets have benefitted already this year from having largely taken their rate hike medicine when inflation first reared its ugly head for them earlier in the pandemic. DEM is showing a 10.6% backward-looking yield, according to WisdomTree’s Digital Portfolio Tool, with its main threat being the unlikely prospect of the dollar strengthening even further. DEM tracks the WisdomTree Emerging Markets Equity Income Index and charges 63 basis points for its use of a fundamental weighting system and its value tilt.
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One area that invites further attention may not even be in the U.S. market itself, with emerging markets (EM) starting the year with a positive rally; specifically, it may be time for EM dividends, given near-record yields in the WisdomTree Emerging Markets High Dividend Fund (DEM). In this case, EM dividends in particular can not only offer exposure to those emerging markets, but also the added benefit of current income -- and in DEM, that income is hitting yields not seen since the 2008 financial crisis. DEM tracks the WisdomTree Emerging Markets Equity Income Index and charges 63 basis points for its use of a fundamental weighting system and its value tilt.
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One area that invites further attention may not even be in the U.S. market itself, with emerging markets (EM) starting the year with a positive rally; specifically, it may be time for EM dividends, given near-record yields in the WisdomTree Emerging Markets High Dividend Fund (DEM). In this case, EM dividends in particular can not only offer exposure to those emerging markets, but also the added benefit of current income -- and in DEM, that income is hitting yields not seen since the 2008 financial crisis. DEM tracks the WisdomTree Emerging Markets Equity Income Index and charges 63 basis points for its use of a fundamental weighting system and its value tilt.
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One area that invites further attention may not even be in the U.S. market itself, with emerging markets (EM) starting the year with a positive rally; specifically, it may be time for EM dividends, given near-record yields in the WisdomTree Emerging Markets High Dividend Fund (DEM). Emerging markets have benefitted already this year from having largely taken their rate hike medicine when inflation first reared its ugly head for them earlier in the pandemic. In this case, EM dividends in particular can not only offer exposure to those emerging markets, but also the added benefit of current income -- and in DEM, that income is hitting yields not seen since the 2008 financial crisis.
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a65cf78f-30fe-4870-9a37-1d7511c82eeb
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727068.0
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2023-01-30 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-7
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nan
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nan
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Launched on 07/13/2007, the WisdomTree Emerging Markets High Dividend ETF (DEM) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
The fund is managed by Wisdomtree, and has been able to amass over $2 billion, which makes it one of the larger ETFs in the Broad Emerging Market ETFs. Before fees and expenses, DEM seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 7.84%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
When you look at individual holdings, Vale Sa (VALE3) accounts for about 6.73% of the fund's total assets, followed by Mediatek Inc and China Construction Bank Corp H.
Performance and Risk
The ETF return is roughly 9.85% so far this year and is down about -5.10% in the last one year (as of 01/30/2023). In the past 52-week period, it has traded between $32.14 and $47.47.
The ETF has a beta of 0.74 and standard deviation of 23.27% for the trailing three-year period, making it a medium risk choice in the space. With about 458 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $73.13 billion in assets, Vanguard FTSE Emerging Markets ETF has $74.96 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Before fees and expenses, DEM seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index. Launched on 07/13/2007, the WisdomTree Emerging Markets High Dividend ETF (DEM) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here.
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Launched on 07/13/2007, the WisdomTree Emerging Markets High Dividend ETF (DEM) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Before fees and expenses, DEM seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
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Launched on 07/13/2007, the WisdomTree Emerging Markets High Dividend ETF (DEM) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Before fees and expenses, DEM seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
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Launched on 07/13/2007, the WisdomTree Emerging Markets High Dividend ETF (DEM) is a smart beta exchange traded fund offering broad exposure to the Broad Emerging Market ETFs category of the market. Before fees and expenses, DEM seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here.
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29a7c746-b79a-4672-8b27-67565aa26be2
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727069.0
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2022-11-28 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-6
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nan
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nan
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Wisdomtree, DEM has amassed assets over $1.72 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index before fees and expenses.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.63%.
DEM's 12-month trailing dividend yield is 9.44%.
Sector Exposure and Top Holdings
Most ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.
When you look at individual holdings, Vale Sa (VALE3) accounts for about 9.03% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Performance and Risk
The ETF has lost about -11.55% so far this year and is down about -8.52% in the last one year (as of 11/28/2022). In the past 52-week period, it has traded between $32.14 and $47.47.
The ETF has a beta of 0.71 and standard deviation of 23.23% for the trailing three-year period, making it a medium risk choice in the space. With about 486 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is not a suitable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. Instead, there are other ETFs in the space which investors should consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $62.54 billion in assets, Vanguard FTSE Emerging Markets ETF has $66.74 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time. Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.72 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.72 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Click to get this free report WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports To read this article on Zacks.com click here. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.72 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.72 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. DEM's 12-month trailing dividend yield is 9.44%.
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8bd196c7-392b-4cc0-a56b-03e0ed1fd0fa
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727070.0
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2022-09-28 00:00:00 UTC
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An Experienced Approach to Value Investing With WisdomTree
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DEM
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https://www.nasdaq.com/articles/an-experienced-approach-to-value-investing-with-wisdomtree
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nan
|
nan
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WisdomTree has long established itself as an innovator and experienced ETF issuer, having launched one of the only non-market-cap-weighted ETF options on the market in June, 2006. The fund was dividend-weighted, an innovation at the time, and since then, WisdomTree has continued to expand and establish itself as a contender within dividends, emerging market strategies, currency hedging, and value investing, one of the top trends in 2022.
Value investing has suffered in the equity bull run of the last decade when growth-oriented strategies dominated, but the trend has reversed course sharply in 2022 amidst an environment of rising interest rates, soaring inflation, global economic uncertainty, and more.
Looking back all the way to 1975, the pendulum swings largely in one direction or the other — growth to value and back again — for years at a time, explained Christopher Gannatti, CFA, global head of research at WisdomTree, in a recent blog. While past performance is never an indicator of future results, being aware of the historic macrotrends can help advisors make better informed decisions in the present.
Image source: WisdomTree blog
“We have a generation of people who say their high-risk investments tend to trend basically in one direction, as the cost of capital was basically zero or if not zero, then insignificant, from roughly 2009 to 2021,” explained Gannatti.
WisdomTree had approximately $50 billion in AUM within the U.S. as of the end of August, with 44.8% of AUM falling under the umbrella of an equity value strategy according to Morningstar classifications. Of those value-oriented assets, 26.6% are in five-star Morningstar-rated funds and 23.4% are in four-star Morningstar-rated funds.
Gannatti broke it down further into how many WisdomTree funds were performing in the top 50th percentile within their categories, with an emphasis on the value funds, over a myriad of timelines.
Image source: WisdomTree blog
“WisdomTree’s track record in managing assets back to 2006 has led to seeing many different types of market environments. The meaning of monetary policy itself and what it entails, for example, has completely changed over this period,” wrote Gannatti. “WisdomTree Funds categorized by Morningstar within the value style have been resilient during the tougher periods, when growth has been in favor, and we have seen a real acceleration in their performance during the current value rotation in 2022.”
Investing in Value-Focused ETFs
WisdomTree has a wide variety of value-oriented ETFs, including the popular WisdomTree U.S. High Dividend Fund (DHS), which invests in high dividend-yielding U.S. equity companies for investors looking for higher-yielding opportunities.
For an international spin on value, the WisdomTree Emerging Markets High Dividend Fund (DEM) invests across all market caps in high dividend-yielding companies within emerging markets, the WisdomTree International High Dividend Fund (DTH) invests in high dividend-yielding companies in the developed world ex-U.S. and Canada, and the WisdomTree Global High Dividend Fund (DEW) invests broadly across developed (including the U.S.) and emerging markets in high dividend-yielding companies.
All four funds are strong value strategies and have offered earnings yields above 9% year-to-date as of 13 September 2022.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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For an international spin on value, the WisdomTree Emerging Markets High Dividend Fund (DEM) invests across all market caps in high dividend-yielding companies within emerging markets, the WisdomTree International High Dividend Fund (DTH) invests in high dividend-yielding companies in the developed world ex-U.S. and Canada, and the WisdomTree Global High Dividend Fund (DEW) invests broadly across developed (including the U.S.) and emerging markets in high dividend-yielding companies. The fund was dividend-weighted, an innovation at the time, and since then, WisdomTree has continued to expand and establish itself as a contender within dividends, emerging market strategies, currency hedging, and value investing, one of the top trends in 2022. Value investing has suffered in the equity bull run of the last decade when growth-oriented strategies dominated, but the trend has reversed course sharply in 2022 amidst an environment of rising interest rates, soaring inflation, global economic uncertainty, and more.
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For an international spin on value, the WisdomTree Emerging Markets High Dividend Fund (DEM) invests across all market caps in high dividend-yielding companies within emerging markets, the WisdomTree International High Dividend Fund (DTH) invests in high dividend-yielding companies in the developed world ex-U.S. and Canada, and the WisdomTree Global High Dividend Fund (DEW) invests broadly across developed (including the U.S.) and emerging markets in high dividend-yielding companies. Image source: WisdomTree blog “WisdomTree’s track record in managing assets back to 2006 has led to seeing many different types of market environments. “WisdomTree Funds categorized by Morningstar within the value style have been resilient during the tougher periods, when growth has been in favor, and we have seen a real acceleration in their performance during the current value rotation in 2022.” Investing in Value-Focused ETFs WisdomTree has a wide variety of value-oriented ETFs, including the popular WisdomTree U.S. High Dividend Fund (DHS), which invests in high dividend-yielding U.S. equity companies for investors looking for higher-yielding opportunities.
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For an international spin on value, the WisdomTree Emerging Markets High Dividend Fund (DEM) invests across all market caps in high dividend-yielding companies within emerging markets, the WisdomTree International High Dividend Fund (DTH) invests in high dividend-yielding companies in the developed world ex-U.S. and Canada, and the WisdomTree Global High Dividend Fund (DEW) invests broadly across developed (including the U.S.) and emerging markets in high dividend-yielding companies. The fund was dividend-weighted, an innovation at the time, and since then, WisdomTree has continued to expand and establish itself as a contender within dividends, emerging market strategies, currency hedging, and value investing, one of the top trends in 2022. “WisdomTree Funds categorized by Morningstar within the value style have been resilient during the tougher periods, when growth has been in favor, and we have seen a real acceleration in their performance during the current value rotation in 2022.” Investing in Value-Focused ETFs WisdomTree has a wide variety of value-oriented ETFs, including the popular WisdomTree U.S. High Dividend Fund (DHS), which invests in high dividend-yielding U.S. equity companies for investors looking for higher-yielding opportunities.
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For an international spin on value, the WisdomTree Emerging Markets High Dividend Fund (DEM) invests across all market caps in high dividend-yielding companies within emerging markets, the WisdomTree International High Dividend Fund (DTH) invests in high dividend-yielding companies in the developed world ex-U.S. and Canada, and the WisdomTree Global High Dividend Fund (DEW) invests broadly across developed (including the U.S.) and emerging markets in high dividend-yielding companies. The fund was dividend-weighted, an innovation at the time, and since then, WisdomTree has continued to expand and establish itself as a contender within dividends, emerging market strategies, currency hedging, and value investing, one of the top trends in 2022. Value investing has suffered in the equity bull run of the last decade when growth-oriented strategies dominated, but the trend has reversed course sharply in 2022 amidst an environment of rising interest rates, soaring inflation, global economic uncertainty, and more.
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e107ea42-8d3c-4f4c-893b-4c003f7f2067
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727071.0
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2022-09-26 00:00:00 UTC
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DEM Crosses Critical Technical Indicator
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DEM
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https://www.nasdaq.com/articles/dem-crosses-critical-technical-indicator
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nan
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nan
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In trading on Monday, shares of the DEM ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $32.89 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of DEM, the RSI reading has hit 22.4 — by comparison, the RSI reading for the S&P 500 is currently 29.6. A bullish investor could look at DEM's 22.4 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $32.89 per share, with $47.66 as the 52 week high point — that compares with a last trade of $33.11. DEM shares are currently trading off about 5.5% on the day.
Find out what 9 other oversold stocks you need to know about »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A bullish investor could look at DEM's 22.4 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. In trading on Monday, shares of the DEM ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $32.89 per share. In the case of DEM, the RSI reading has hit 22.4 — by comparison, the RSI reading for the S&P 500 is currently 29.6.
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In trading on Monday, shares of the DEM ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $32.89 per share. In the case of DEM, the RSI reading has hit 22.4 — by comparison, the RSI reading for the S&P 500 is currently 29.6. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $32.89 per share, with $47.66 as the 52 week high point — that compares with a last trade of $33.11.
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In trading on Monday, shares of the DEM ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $32.89 per share. In the case of DEM, the RSI reading has hit 22.4 — by comparison, the RSI reading for the S&P 500 is currently 29.6. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $32.89 per share, with $47.66 as the 52 week high point — that compares with a last trade of $33.11.
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In trading on Monday, shares of the DEM ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $32.89 per share. In the case of DEM, the RSI reading has hit 22.4 — by comparison, the RSI reading for the S&P 500 is currently 29.6. A bullish investor could look at DEM's 22.4 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
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456a6bdc-80c7-4cb9-9538-a318d12999ca
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727072.0
|
2022-09-26 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-5
|
nan
|
nan
|
Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
But, there are some investors who would rather invest in smart beta funds; these funds track non-cap weighted strategies, and are a strong option for those who prefer choosing great stocks in order to beat the market.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
Managed by Wisdomtree, DEM has amassed assets over $1.71 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. DEM, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.63%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 8.15%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.03% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Performance and Risk
The ETF has lost about -16.66% and is down about -16.06% so far this year and in the past one year (as of 09/26/2022), respectively. DEM has traded between $34.91 and $47.47 during this last 52-week period.
The ETF has a beta of 0.74 and standard deviation of 22.63% for the trailing three-year period, making it a medium risk choice in the space. With about 486 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $59.07 billion in assets, Vanguard FTSE Emerging Markets ETF has $64.28 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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DEM, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index. Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.71 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.71 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. DEM, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $1.71 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. DEM, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
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Making its debut on 07/13/2007, smart beta exchange traded fund WisdomTree Emerging Markets High Dividend ETF (DEM) provides investors broad exposure to the Broad Emerging Market ETFs category of the market. DEM, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index. WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
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a05eb097-a0b6-44df-b8d2-d503f89e1213
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727073.0
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2022-07-25 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-4
|
nan
|
nan
|
The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency.
If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
While this space offers a number of choices to investors, including simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies, not all these strategies have been able to deliver superior results.
Fund Sponsor & Index
The fund is sponsored by Wisdomtree. It has amassed assets over $1.74 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
Expense ratios are an important factor in the return of an ETF and in the long-term, cheaper funds can significantly outperform their more expensive cousins, other things remaining the same.
Operating expenses on an annual basis are 0.63% for this ETF, which makes it on par with most peer products in the space.
It's 12-month trailing dividend yield comes in at 8.05%.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.51% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Its top 10 holdings account for approximately 29.69% of DEM's total assets under management.
Performance and Risk
The ETF has lost about -15.67% so far this year and is down about -14.75% in the last one year (as of 07/25/2022). In the past 52-week period, it has traded between $34.91 and $47.47.
DEM has a beta of 0.79 and standard deviation of 22.69% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 492 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $64.55 billion in assets, Vanguard FTSE Emerging Markets ETF has $69.83 billion. IEMG has an expense ratio of 0.09% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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DEM has a beta of 0.79 and standard deviation of 22.69% for the trailing three-year period, which makes the fund a medium risk choice in the space. The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.51% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H. Its top 10 holdings account for approximately 29.69% of DEM's total assets under management.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.51% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H. Its top 10 holdings account for approximately 29.69% of DEM's total assets under management. DEM has a beta of 0.79 and standard deviation of 22.69% for the trailing three-year period, which makes the fund a medium risk choice in the space.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.51% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H. Its top 10 holdings account for approximately 29.69% of DEM's total assets under management. DEM has a beta of 0.79 and standard deviation of 22.69% for the trailing three-year period, which makes the fund a medium risk choice in the space.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Taking into account individual holdings, Vale Sa (VALE3) accounts for about 9.51% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H. Its top 10 holdings account for approximately 29.69% of DEM's total assets under management. DEM has a beta of 0.79 and standard deviation of 22.69% for the trailing three-year period, which makes the fund a medium risk choice in the space.
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8be42bc7-9515-4f2f-aa57-74f253335fbc
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727074.0
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2022-07-13 00:00:00 UTC
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DEM Crowded With Sellers
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DEM
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https://www.nasdaq.com/articles/dem-crowded-with-sellers
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nan
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nan
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In trading on Wednesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $35.27 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of WisdomTree Emerging Markets High Dividend Fund, the RSI reading has hit 27.7 — by comparison, the RSI reading for the S&P 500 is currently 42.9. A bullish investor could look at DEM's 27.7 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $35.27 per share, with $47.66 as the 52 week high point — that compares with a last trade of $35.39. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 1.3% on the day.
Click here to find out what 9 other oversold dividend stocks you need to know about »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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A bullish investor could look at DEM's 27.7 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. In trading on Wednesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $35.27 per share. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $35.27 per share, with $47.66 as the 52 week high point — that compares with a last trade of $35.39.
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In trading on Wednesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $35.27 per share. A bullish investor could look at DEM's 27.7 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $35.27 per share, with $47.66 as the 52 week high point — that compares with a last trade of $35.39.
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In trading on Wednesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $35.27 per share. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $35.27 per share, with $47.66 as the 52 week high point — that compares with a last trade of $35.39. A bullish investor could look at DEM's 27.7 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
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In trading on Wednesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $35.27 per share. A bullish investor could look at DEM's 27.7 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $35.27 per share, with $47.66 as the 52 week high point — that compares with a last trade of $35.39.
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7b7cfe7a-3e91-46f2-ad69-dc8153e00ece
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727075.0
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2022-06-29 00:00:00 UTC
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Want Dividends and Value? These Two Funds Offer the Most of Both
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DEM
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https://www.nasdaq.com/articles/want-dividends-and-value-these-two-funds-offer-the-most-of-both
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nan
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nan
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It’s no secret that advisors and investors have gravitated to value in 2022 as the biggest growth stocks have plummeted from last year’s November highs. With the S&P 500 on its way to the worst first half of the year in 52 years and the Nasdaq Composite likely rounding out the first half of 2022 as the worst on record according to MarketWatch, money has moved from the growth drivers of the last decade to the more predictable performance offered by value.
“Now this market has flipped on a dime,” said Jeff Weniger, CFA and head of equity strategy at WisdomTree, on a call earlier this month with VettaFi. “DHS and the cousin in emerging markets, DEM, are two of the deepest value mandates of the 80 or 90 ETFs” that WisdomTree offers, Weniger explained.
Indeed, it’s something that advisors and investors have taken note of, particularly in the pivot to dividends that has happened as well. The WisdomTree U.S. High Dividend Fund (DHS) has experienced net flows of $271.87 million year-to-date per FactSet, while the WisdomTree Emerging Markets High Dividend Fund (DEM) has experienced net flows of $284.85 million YTD per FactSet.
“The two factors that have worked the best this year have been value and dividends and… You can get that in extremes in DHS,” said Scott Welch, CIMA, and CIO of model portfolios at WisdomTree, on the same call. “Give me the most you have of those two things: well, that’s DHS,” for the U.S. and DEM for emerging markets.
The Ultimate Value and Dividend Play With WisdomTree
The WisdomTree U.S. High Dividend Fund (DHS) invests in high dividend-yielding U.S. equity companies and seeks to track the WisdomTree U.S. High Dividend Index. The index contains the top 30% of companies by dividend yield from the WisdomTree U.S. Dividend Index, and the index is dividend-weighted based on projected dividends for the next year.
The fund invests 95% of its assets in the securities of the index and securities that are essentially identical in their economic characteristics under normal circumstances. Sector representation is capped at a 25% weight (real estate is capped at 5%), and individual securities are capped at a 5% weight in the index.
DHS has an expense ratio of 0.38%.
The WisdomTree Emerging Markets High Dividend Fund (DEM) invests in high dividend-yielding emerging market companies and seeks to track the WisdomTree Emerging Markets Dividend Index. The index is fundamentally weighted and contains the top 30% of companies by dividend yield, and the index is dividend-weighted based on dividends paid in the previous year.
Sectors and countries are capped at a 25% weight within the index (real estate is capped at 15%), with individual securities capped at 5%.
The fund invests 95% of its assets in the securities of the index and securities that are essentially identical in their economic characteristics under normal circumstances.
DEM has an expense ratio of 0.63%
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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“DHS and the cousin in emerging markets, DEM, are two of the deepest value mandates of the 80 or 90 ETFs” that WisdomTree offers, Weniger explained. The WisdomTree U.S. High Dividend Fund (DHS) has experienced net flows of $271.87 million year-to-date per FactSet, while the WisdomTree Emerging Markets High Dividend Fund (DEM) has experienced net flows of $284.85 million YTD per FactSet. “Give me the most you have of those two things: well, that’s DHS,” for the U.S. and DEM for emerging markets.
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The WisdomTree U.S. High Dividend Fund (DHS) has experienced net flows of $271.87 million year-to-date per FactSet, while the WisdomTree Emerging Markets High Dividend Fund (DEM) has experienced net flows of $284.85 million YTD per FactSet. The WisdomTree Emerging Markets High Dividend Fund (DEM) invests in high dividend-yielding emerging market companies and seeks to track the WisdomTree Emerging Markets Dividend Index. “DHS and the cousin in emerging markets, DEM, are two of the deepest value mandates of the 80 or 90 ETFs” that WisdomTree offers, Weniger explained.
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The WisdomTree U.S. High Dividend Fund (DHS) has experienced net flows of $271.87 million year-to-date per FactSet, while the WisdomTree Emerging Markets High Dividend Fund (DEM) has experienced net flows of $284.85 million YTD per FactSet. The WisdomTree Emerging Markets High Dividend Fund (DEM) invests in high dividend-yielding emerging market companies and seeks to track the WisdomTree Emerging Markets Dividend Index. “DHS and the cousin in emerging markets, DEM, are two of the deepest value mandates of the 80 or 90 ETFs” that WisdomTree offers, Weniger explained.
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“DHS and the cousin in emerging markets, DEM, are two of the deepest value mandates of the 80 or 90 ETFs” that WisdomTree offers, Weniger explained. The WisdomTree Emerging Markets High Dividend Fund (DEM) invests in high dividend-yielding emerging market companies and seeks to track the WisdomTree Emerging Markets Dividend Index. The WisdomTree U.S. High Dividend Fund (DHS) has experienced net flows of $271.87 million year-to-date per FactSet, while the WisdomTree Emerging Markets High Dividend Fund (DEM) has experienced net flows of $284.85 million YTD per FactSet.
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61a10e96-270c-435f-a968-caf635ed69bc
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727076.0
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2022-06-29 00:00:00 UTC
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Interesting DEM Put And Call Options For August 19th
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DEM
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https://www.nasdaq.com/articles/interesting-dem-put-and-call-options-for-august-19th
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nan
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nan
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Investors in WisdomTree Trust Japan SmallCap Dividend Fund (Symbol: DEM) saw new options become available this week, for the August 19th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DEM options chain for the new August 19th contracts and identified one put and one call contract of particular interest.
The put contract at the $37.00 strike price has a current bid of 85 cents. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $37.00, but will also collect the premium, putting the cost basis of the shares at $36.15 (before broker commissions). To an investor already interested in purchasing shares of DEM, that could represent an attractive alternative to paying $37.40/share today.
Because the $37.00 strike represents an approximate 1% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 52%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 2.30% return on the cash commitment, or 16.44% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for WisdomTree Trust Japan SmallCap Dividend Fund, and highlighting in green where the $37.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $38.00 strike price has a current bid of 80 cents. If an investor was to purchase shares of DEM stock at the current price level of $37.40/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $38.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 3.74% if the stock gets called away at the August 19th expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if DEM shares really soar, which is why looking at the trailing twelve month trading history for WisdomTree Trust Japan SmallCap Dividend Fund, as well as studying the business fundamentals becomes important. Below is a chart showing DEM's trailing twelve month trading history, with the $38.00 strike highlighted in red:
Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 64%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 2.14% boost of extra return to the investor, or 15.31% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example, as well as the call contract example, are both approximately 22%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 252 trading day closing values as well as today's price of $37.40) to be 17%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Top YieldBoost Calls of the S&P 500 »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Of course, a lot of upside could potentially be left on the table if DEM shares really soar, which is why looking at the trailing twelve month trading history for WisdomTree Trust Japan SmallCap Dividend Fund, as well as studying the business fundamentals becomes important. Below is a chart showing DEM's trailing twelve month trading history, with the $38.00 strike highlighted in red: Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in WisdomTree Trust Japan SmallCap Dividend Fund (Symbol: DEM) saw new options become available this week, for the August 19th expiration.
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Of course, a lot of upside could potentially be left on the table if DEM shares really soar, which is why looking at the trailing twelve month trading history for WisdomTree Trust Japan SmallCap Dividend Fund, as well as studying the business fundamentals becomes important. Below is a chart showing DEM's trailing twelve month trading history, with the $38.00 strike highlighted in red: Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in WisdomTree Trust Japan SmallCap Dividend Fund (Symbol: DEM) saw new options become available this week, for the August 19th expiration.
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Below is a chart showing DEM's trailing twelve month trading history, with the $38.00 strike highlighted in red: Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in WisdomTree Trust Japan SmallCap Dividend Fund (Symbol: DEM) saw new options become available this week, for the August 19th expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the DEM options chain for the new August 19th contracts and identified one put and one call contract of particular interest.
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At Stock Options Channel, our YieldBoost formula has looked up and down the DEM options chain for the new August 19th contracts and identified one put and one call contract of particular interest. Below is a chart showing DEM's trailing twelve month trading history, with the $38.00 strike highlighted in red: Considering the fact that the $38.00 strike represents an approximate 2% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. Investors in WisdomTree Trust Japan SmallCap Dividend Fund (Symbol: DEM) saw new options become available this week, for the August 19th expiration.
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855870bd-3d4c-4629-ae5d-5b6255e7ca3f
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727077.0
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2022-05-23 00:00:00 UTC
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Where to Turn for Value in Emerging Markets Stocks
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DEM
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https://www.nasdaq.com/articles/where-to-turn-for-value-in-emerging-markets-stocks
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nan
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nan
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It’s long been said that emerging markets equities offer investors a value proposition relative to U.S. stocks, and that remains true today despite a rough five-month stretch for the S&P 500.
However, as is the case with searching for value in other regions, some exchange traded funds are better suited for emerging markets value-seekers than others. One ETF in the emerging markets space is the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
“Market volatility seems like it will be a feature for the rest of the year, but recent moves have actuall
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It’s long been said that emerging markets equities offer investors a value proposition relative to U.S. stocks, and that remains true today despite a rough five-month stretch for the S&P 500. However, as is the case with searching for value in other regions, some exchange traded funds are better suited for emerging markets value-seekers than others. “Market volatility seems like it will be a feature for the rest of the year, but recent moves have actuall
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It’s long been said that emerging markets equities offer investors a value proposition relative to U.S. stocks, and that remains true today despite a rough five-month stretch for the S&P 500. However, as is the case with searching for value in other regions, some exchange traded funds are better suited for emerging markets value-seekers than others. One ETF in the emerging markets space is the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
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It’s long been said that emerging markets equities offer investors a value proposition relative to U.S. stocks, and that remains true today despite a rough five-month stretch for the S&P 500. However, as is the case with searching for value in other regions, some exchange traded funds are better suited for emerging markets value-seekers than others. One ETF in the emerging markets space is the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
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It’s long been said that emerging markets equities offer investors a value proposition relative to U.S. stocks, and that remains true today despite a rough five-month stretch for the S&P 500. However, as is the case with searching for value in other regions, some exchange traded funds are better suited for emerging markets value-seekers than others. One ETF in the emerging markets space is the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
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14713fd7-7703-4dfb-be30-1f13b4729a12
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727078.0
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2022-04-26 00:00:00 UTC
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Emerging Markets Dividend Proposition Increasingly Attractive
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DEM
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https://www.nasdaq.com/articles/emerging-markets-dividend-proposition-increasingly-attractive
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nan
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nan
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Emerging markets stocks are struggling again in 2022, but some better areas could morph into leaders if global equities rebound.
Emerging markets dividend payers top that list of ideas. Consider the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). DEM, which follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is outpacing the MSCI Emerging Markets Index by 840 basis points year-to-date.
Clearly, that’s a sizable gap and one that underscores the benefits of dividend stocks, regardless of domicile, in turbulent market settings.
“At the outset of the year, we suggested investors consider EM high dividends, with three key themes in mind: 1) a high inflation environment, 2) rising interest rates and 3) Chinese regulatory/COVID policy risks,” notes WisdomTree analyst Matt Wagner. “While we couldn’t foresee the Russia-Ukraine war, the conflict has intensified the first two themes, benefiting EM Energy and Materials companies.”
The $1.96 billion DEM, which turns 15 years old in July, allocates over 34% of its total weight to materials and energy stocks and those are the fund’s second- and third-largest sector weights, respectively. That remains the case despite DEM essentially ridding its portfolio of Russian stocks following that country’s invasion of Ukraine.
“Entering the year, WTEMHY had the greatest exposure to Russia among WisdomTree’s equity Indexes, and an overweight allocation of 5% relative to the MSCI Emerging Markets Index (8% vs. 3%),” adds Wagner. “The overweight exposure contributed 553 bps of negative attribution for WTEMHY relative to MSCI EM. With the Russian names in WTEMHY marked down to nearly 0% values and entirely removed from the MSCI EM Index, the relative overweight for WTEMHY is now just 70 bps.”
Although it entered the year significantly overweight with Russian stocks relative to the MSCI Emerging Markets Index, DEM is managing to easily outperform that benchmark. That’s a testament to the fund’s dividend, short duration equity, and value exposures. Other geographic exposures also highlight DEM benefits.
“The Russia headwind was offset by an underweight to China—specifically to China growth stocks—and an overweight to Brazilian Energy and Materials companies that have benefited from rising commodity prices,” concludes Wagner. “The positive attribution of over 500 bps between Brazil and China fully offset the negative attribution from Russia.”
Brazil is DEM’s third-largest country weight at 19.39%, representing a significant overweight relative to the MSCI Emerging Markets Index.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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“While we couldn’t foresee the Russia-Ukraine war, the conflict has intensified the first two themes, benefiting EM Energy and Materials companies.” The $1.96 billion DEM, which turns 15 years old in July, allocates over 34% of its total weight to materials and energy stocks and those are the fund’s second- and third-largest sector weights, respectively. With the Russian names in WTEMHY marked down to nearly 0% values and entirely removed from the MSCI EM Index, the relative overweight for WTEMHY is now just 70 bps.” Although it entered the year significantly overweight with Russian stocks relative to the MSCI Emerging Markets Index, DEM is managing to easily outperform that benchmark. Consider the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
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With the Russian names in WTEMHY marked down to nearly 0% values and entirely removed from the MSCI EM Index, the relative overweight for WTEMHY is now just 70 bps.” Although it entered the year significantly overweight with Russian stocks relative to the MSCI Emerging Markets Index, DEM is managing to easily outperform that benchmark. “The positive attribution of over 500 bps between Brazil and China fully offset the negative attribution from Russia.” Brazil is DEM’s third-largest country weight at 19.39%, representing a significant overweight relative to the MSCI Emerging Markets Index. Consider the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
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DEM, which follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is outpacing the MSCI Emerging Markets Index by 840 basis points year-to-date. With the Russian names in WTEMHY marked down to nearly 0% values and entirely removed from the MSCI EM Index, the relative overweight for WTEMHY is now just 70 bps.” Although it entered the year significantly overweight with Russian stocks relative to the MSCI Emerging Markets Index, DEM is managing to easily outperform that benchmark. Consider the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
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Consider the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). DEM, which follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is outpacing the MSCI Emerging Markets Index by 840 basis points year-to-date. “While we couldn’t foresee the Russia-Ukraine war, the conflict has intensified the first two themes, benefiting EM Energy and Materials companies.” The $1.96 billion DEM, which turns 15 years old in July, allocates over 34% of its total weight to materials and energy stocks and those are the fund’s second- and third-largest sector weights, respectively.
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7babe7f7-dd0e-4b42-9b9d-4d8ba66032f8
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727079.0
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2022-04-25 00:00:00 UTC
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Some Emerging Market ETFs Are Shining
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DEM
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https://www.nasdaq.com/articles/some-emerging-market-etfs-are-shining
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nan
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nan
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During a recent ETF Trends webcast focused on emerging markets, 42% of advisor respondents said that they allocate between 5% and 10% of client assets to emerging markets, and an additional 11% reported taking an even more aggressive approach. However, the majority were using broad emerging market ETFs to gain exposure. Given the performance challenges for such equity ETFs, we expect advisors to look for alternatives.
As of April 21, the three largest emerging markets equity ETFs -- the Vanguard FTSE Emerging Markets ETF (VWO), the iShares Core MSCI Emerging Markets ETF (IEMG), and the iShares MSCI Emerging Markets ETF (EEM) -- were down between 11% and 13% to start the year. These broad funds were partially dragged down by hefty exposure to China. While volatility is to be expected with emerging markets, advisors can either complement exposure to EEM, IEMG, or VWO, or potentially replace these funds with something different. Let’s review some of this year’s better-performing alternatives and how they are positioned. (This list is not exhaustive.)
The Invesco S&P Emerging Markets Low Volatility ETF (EELV) rose 3.6%, significantly outperforming broad market ETF peers. The ETF is built from the bottom up by focusing on the least-volatile stocks in the emerging markets universe -- that seems to be an oxymoron, but it is true -- and is rebalanced quarterly. EELV is heavily exposed to financials (40% of assets) and has more exposure to Taiwan (25%), Thailand (11%), and Saudi Arabia (11%) than China (9%).
The WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS) are relatively strong performers, having declined only 1.5% and 1.6%, respectively. Dividend-paying companies, particularly in emerging markets, also tend to provide more stability during market uncertainty as the income component offers appeal.
While multi-cap-focused DEM had slightly less exposure to China than IEMG (23% vs. 26%), its small-cap sibling DGS had only 11%, with hefty stakes toward Taiwan and South Korea. DEM benefitted in part from allocating 21% of assets in Brazilian stocks such as Petroleo Brasileiro and Vale.
The Freedom 100 Emerging Markets ETF (FRDM) invests in large-cap companies based in countries with high human and economic free scores, which includes Chile (21%), Taiwan (18%), South Korea (16%), and Poland (11%), but not China. This approach has performed relatively well in 2022, with FRDM down just 3.6% year-to-date through April 20.
Lastly, the JPMorgan Diversified Return Emerging Markets ETF (JPEM) fell 4.4% to start 2022. JPEM owns shares of emerging market companies with low value, high quality, and strong momentum attributes, but the fund also is broad benchmark-aware at the regional level. Companies based in China (23%), Taiwan (11%), Brazil (11%), and India (11%) are most represented.
Despite the losses for some products, advisors believe it is important to have emerging market equity exposure as part of a well-diversified portfolio. There are lots of choices to consider, but it is important to understand how and why these funds are positioned the way they are before investing.
To see more of Todd’s research, reports, and commentary on a regular basis, please subscribe here.
For more news, information, and strategy, visit ETF Trends.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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While multi-cap-focused DEM had slightly less exposure to China than IEMG (23% vs. 26%), its small-cap sibling DGS had only 11%, with hefty stakes toward Taiwan and South Korea. The WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS) are relatively strong performers, having declined only 1.5% and 1.6%, respectively. DEM benefitted in part from allocating 21% of assets in Brazilian stocks such as Petroleo Brasileiro and Vale.
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The WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS) are relatively strong performers, having declined only 1.5% and 1.6%, respectively. While multi-cap-focused DEM had slightly less exposure to China than IEMG (23% vs. 26%), its small-cap sibling DGS had only 11%, with hefty stakes toward Taiwan and South Korea. DEM benefitted in part from allocating 21% of assets in Brazilian stocks such as Petroleo Brasileiro and Vale.
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The WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS) are relatively strong performers, having declined only 1.5% and 1.6%, respectively. While multi-cap-focused DEM had slightly less exposure to China than IEMG (23% vs. 26%), its small-cap sibling DGS had only 11%, with hefty stakes toward Taiwan and South Korea. DEM benefitted in part from allocating 21% of assets in Brazilian stocks such as Petroleo Brasileiro and Vale.
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While multi-cap-focused DEM had slightly less exposure to China than IEMG (23% vs. 26%), its small-cap sibling DGS had only 11%, with hefty stakes toward Taiwan and South Korea. The WisdomTree Emerging Markets High Dividend Fund (DEM) and the WisdomTree Emerging Markets SmallCap Dividend Fund (DGS) are relatively strong performers, having declined only 1.5% and 1.6%, respectively. DEM benefitted in part from allocating 21% of assets in Brazilian stocks such as Petroleo Brasileiro and Vale.
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4450cedd-ed82-44b2-9dc0-96a7b7f1e5a9
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727080.0
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2022-04-20 00:00:00 UTC
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Evaluate EDOG for Latin American Exposure
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DEM
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https://www.nasdaq.com/articles/evaluate-edog-for-latin-american-exposure
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nan
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nan
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Emerging markets stocks are struggling again this year, but that’s painting with broad strokes. Investors taking the time to conduct further examination will find pleasant surprises in the form of Latin American stocks.
The problem is that supposedly broad emerging markets exchange traded funds aren’t all that diversified, and the bulk of their Latin American equity exposure is sourced via Brazil.
The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is an ideal way with which to solve this problem because the fund more evenly distributes its country allocations, meaning that it has more Latin America exposure than rival broad-based funds. The difference is material, as the ALPS ETF is beating the MSCI Emerging Markets Index by 460 basis points on a year-to-date basis.
“Despite the existing political, economic and social environment, the markets greatly rebounded in Q1. So much so that on March 31, 2022, the flagship indices for Mexico and Peru both reached their all-time highs,” notes S&P Dow Jones Indices.
EDOG allocates 8.23% of its weight to Mexican stocks, which is more than triple the weight assigned to Latin America’s second-largest economy by the MSCI Emerging Markets Index. EDOG also has sector-level advantages.
“Based on the S&P Latin America BMI sectors, only Information Technology did poorly, losing 5.2% in Q1; all others had strong positive returns,” adds S&P Dow Jones. “Financials (35.0%) and Materials (32.5%) were the largest sectors by weight, and in Q1, they made the largest contribution to the total return of the broad regional index.”
EDOG allocates about 9% of its weight to tech stocks, but the bulk of those names aren’t Latin American stocks. The fund devotes more than 19% of its roster to the materials and financial services sectors. EDOG has more Latin American representation from those sectors.
As for Brazil, Latin America’s largest economy is leading the way in terms of the region’s equity market performance. That’s good news for EDOG investors because Brazil is the ETF’s biggest country exposure at 11.24%.
Brazil’s stock market is soaring due in large part to surging commodities prices. On that note, EDOG allocates a combined 29% of its weight to commodities-rich Brazil, Chile, and Mexico.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Investors taking the time to conduct further examination will find pleasant surprises in the form of Latin American stocks. The problem is that supposedly broad emerging markets exchange traded funds aren’t all that diversified, and the bulk of their Latin American equity exposure is sourced via Brazil.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is an ideal way with which to solve this problem because the fund more evenly distributes its country allocations, meaning that it has more Latin America exposure than rival broad-based funds. “Financials (35.0%) and Materials (32.5%) were the largest sectors by weight, and in Q1, they made the largest contribution to the total return of the broad regional index.” EDOG allocates about 9% of its weight to tech stocks, but the bulk of those names aren’t Latin American stocks.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). EDOG allocates 8.23% of its weight to Mexican stocks, which is more than triple the weight assigned to Latin America’s second-largest economy by the MSCI Emerging Markets Index. “Financials (35.0%) and Materials (32.5%) were the largest sectors by weight, and in Q1, they made the largest contribution to the total return of the broad regional index.” EDOG allocates about 9% of its weight to tech stocks, but the bulk of those names aren’t Latin American stocks.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The problem is that supposedly broad emerging markets exchange traded funds aren’t all that diversified, and the bulk of their Latin American equity exposure is sourced via Brazil. EDOG allocates 8.23% of its weight to Mexican stocks, which is more than triple the weight assigned to Latin America’s second-largest economy by the MSCI Emerging Markets Index.
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05d407b6-7bdd-4295-a5a6-98286150318c
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727081.0
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2022-04-18 00:00:00 UTC
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The Right ETF for Big EM Dividends
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DEM
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https://www.nasdaq.com/articles/the-right-etf-for-big-em-dividends
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nan
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nan
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Experienced dividend investors know that a plethora of ex-U.S. regions offer bigger yields than are found on broad-based domestic equity benchmarks.
Emerging markets are part of that conversation. However, investors need to be selective when it comes to the related exchange traded funds because, prior to its war against Ukraine, Russia was one of the largest emerging markets dividend payers.
Fortunately, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) eliminated its Russian holdings. DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is a relevant consideration not only because payouts can reduce some of the volatility associated with emerging markets equities, but also because some investors aren’t aware of the dividend proposition in these economies.
“Of the $1.4 trillion in the global Dividend Stream, $216 billion, or 15%, comes from companies within emerging markets. That amount is just over 3.5% greater than the 11.5% weight that emerging markets have in the market cap-weighted MSCI ACWI IMI Index,” notes WisdomTree analyst Matt Wagner.
As is the case with domestic equity funds, sector exposures matter when it comes to emerging markets dividend strategies. DEM is an ideal way to capitalize on that.
“In the emerging markets, the largest dividend sectors are Financials (26%), Materials (16%), Information Technology (17%) and Energy (10%),” adds Wagner.
DEM allocates nearly half its weight to the financial services and materials sectors, while energy is the fund’s third-largest sector exposure at 12.43%. Technology places fourth at almost 11%. Translation: DEM positions investors for the most credible sector-level dividend growth opportunities in developing economies.
At the country level, Russia’s departure refreshes DEM’s portfolio, potentially positioning investors to capitalize on soaring commodities with a larger weight to Brazil.
“Brazil is the most noticeable overweight given its large dividend-paying Energy and Materials companies. Russia was recently removed from MSCI indexes for its invasion of Ukraine but historically had been another overweight based on its large dividend payouts,” says Wagner.
Brazil, Latin America’s largest economy, is DEM’s second-largest geographic weight behind China at 21.12%. Taiwan, one of the least volatile emerging markets, is the ETF’s third-largest country weight at 19.81%. That’s an important trait because Taiwan is a tech-heavy, high-quality market with strong dividend growth potential. Bottom line: DEM has some compelling attributes for investors seeking ex-U.S. dividend exposure.
“For investors looking to increase dividend income, emerging markets equities may offer a compelling addition to portfolios in a low-yield environment,” concludes Wagner.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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At the country level, Russia’s departure refreshes DEM’s portfolio, potentially positioning investors to capitalize on soaring commodities with a larger weight to Brazil. Fortunately, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) eliminated its Russian holdings. DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is a relevant consideration not only because payouts can reduce some of the volatility associated with emerging markets equities, but also because some investors aren’t aware of the dividend proposition in these economies.
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Fortunately, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) eliminated its Russian holdings. DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is a relevant consideration not only because payouts can reduce some of the volatility associated with emerging markets equities, but also because some investors aren’t aware of the dividend proposition in these economies. DEM is an ideal way to capitalize on that.
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DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is a relevant consideration not only because payouts can reduce some of the volatility associated with emerging markets equities, but also because some investors aren’t aware of the dividend proposition in these economies. Fortunately, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) eliminated its Russian holdings. DEM is an ideal way to capitalize on that.
|
At the country level, Russia’s departure refreshes DEM’s portfolio, potentially positioning investors to capitalize on soaring commodities with a larger weight to Brazil. Fortunately, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) eliminated its Russian holdings. DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), is a relevant consideration not only because payouts can reduce some of the volatility associated with emerging markets equities, but also because some investors aren’t aware of the dividend proposition in these economies.
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0dff3dd4-b546-4ee0-b976-af69ebf91899
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727082.0
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2022-04-01 00:00:00 UTC
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DEM Makes Bullish Cross Above Critical Moving Average
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DEM
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https://www.nasdaq.com/articles/dem-makes-bullish-cross-above-critical-moving-average
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nan
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nan
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In trading on Friday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.37, changing hands as high as $44.47 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.5% on the day. The chart below shows the one year performance of DEM shares, versus its 200 day moving average:
Looking at the chart above, DEM's low point in its 52 week range is $40.23 per share, with $47.66 as the 52 week high point — that compares with a last trade of $44.34.
Free Report: Top 7%+ Dividends (paid monthly)
Click here to find out which 9 other ETFs recently crossed above their 200 day moving average »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.23 per share, with $47.66 as the 52 week high point — that compares with a last trade of $44.34. In trading on Friday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.37, changing hands as high as $44.47 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.5% on the day.
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In trading on Friday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.37, changing hands as high as $44.47 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.23 per share, with $47.66 as the 52 week high point — that compares with a last trade of $44.34. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.5% on the day.
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In trading on Friday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.37, changing hands as high as $44.47 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.23 per share, with $47.66 as the 52 week high point — that compares with a last trade of $44.34. Free Report: Top 7%+ Dividends (paid monthly) Click here to find out which 9 other ETFs recently crossed above their 200 day moving average » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Friday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.37, changing hands as high as $44.47 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.23 per share, with $47.66 as the 52 week high point — that compares with a last trade of $44.34. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.5% on the day.
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59be06ea-7f4c-4bc8-9bb4-4388e78b9f5f
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727083.0
|
2022-03-21 00:00:00 UTC
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Is WisdomTree Emerging Markets High Dividend ETF (DEM) a Strong ETF Right Now?
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DEM
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https://www.nasdaq.com/articles/is-wisdomtree-emerging-markets-high-dividend-etf-dem-a-strong-etf-right-now-2
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nan
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nan
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market.
What Are Smart Beta ETFs?
Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
There are some investors, though, who think it's possible to beat the market with great stock selection; this group likely invests in another class of funds known as smart beta, which track non-cap weighted strategies.
Based on specific fundamental characteristics, or a combination of such, these indexes attempt to pick stocks that have a better chance of risk-return performance.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. This particular fund, before fees and expenses, seeks to match the performance of the WisdomTree Emerging Markets High Dividend Index.
The WisdomTree Emerging Markets High Dividend Index is a fundamentally weighted index that measures the performance of the highest dividend yielding stocks selected from the WisdomTree Emerging Markets Dividend Index.
Cost & Other Expenses
For ETF investors, expense ratios are an important factor when considering a fund's return; in the long-term, cheaper funds actually have the ability to outperform their more expensive cousins if all other things remain the same.
Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 5.88%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
Taking into account individual holdings, Vale Sa (VALE3) accounts for about 8.86% of the fund's total assets, followed by Petroleo Brasileiro Sa (PETR3) and China Construction Bank Corp H.
Its top 10 holdings account for approximately 28.18% of DEM's total assets under management.
Performance and Risk
The ETF has lost about -0.41% so far this year and is up about 4.05% in the last one year (as of 03/21/2022). In the past 52-week period, it has traded between $40.62 and $47.61.
DEM has a beta of 0.79 and standard deviation of 22.22% for the trailing three-year period, which makes the fund a medium risk choice in the space. With about 493 holdings, it effectively diversifies company-specific risk.
Alternatives
WisdomTree Emerging Markets High Dividend ETF is a reasonable option for investors seeking to outperform the Broad Emerging Market ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
IShares Core MSCI Emerging Markets ETF (IEMG) tracks MSCI Emerging Markets Investable Market Index and the Vanguard FTSE Emerging Markets ETF (VWO) tracks FTSE Emerging Markets All Cap China A Inclusion Index. IShares Core MSCI Emerging Markets ETF has $71.65 billion in assets, Vanguard FTSE Emerging Markets ETF has $77.73 billion. IEMG has an expense ratio of 0.11% and VWO charges 0.08%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Broad Emerging Market ETFs.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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WisdomTree Emerging Markets High Dividend ETF (DEM): ETF Research Reports
iShares Core MSCI Emerging Markets ETF (IEMG): ETF Research Reports
Vanguard FTSE Emerging Markets ETF (VWO): ETF Research Reports
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Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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DEM has a beta of 0.79 and standard deviation of 22.22% for the trailing three-year period, which makes the fund a medium risk choice in the space. The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
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The WisdomTree Emerging Markets High Dividend ETF (DEM) was launched on 07/13/2007, and is a smart beta exchange traded fund designed to offer broad exposure to the Broad Emerging Market ETFs category of the market. Fund Sponsor & Index Managed by Wisdomtree, DEM has amassed assets over $2.09 billion, making it one of the larger ETFs in the Broad Emerging Market ETFs. Annual operating expenses for DEM are 0.63%, which makes it on par with most peer products in the space.
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91f80060-2e5c-4fd5-ba7d-95a6a6217c30
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727084.0
|
2022-03-11 00:00:00 UTC
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This Emerging Markets ETF Kicks Russia to the Curb
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DEM
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https://www.nasdaq.com/articles/this-emerging-markets-etf-kicks-russia-to-the-curb
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nan
|
nan
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These days, the less exposure to Russian stocks an emerging markets exchange traded fund has the better.
The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is a prime example of an emerging markets ETF that, although it's passively managed, reacted swiftly to significantly reduce its Russia exposure amid that country instigating a war with neighboring Ukraine.
EDOG, which turns eight years old later this month, follows the S-Network Emerging Markets Index. All Alerian S-Network indexes removed “all Russian-linked index constituents from all Alerian S-Network Equity Indexes effective from the open on Monday, March 7, 2022,” according to the index provider.
As of March 10, EDOG's Russia exposure was just 0.43%, making that country by far the smallest of the dividend fund's 15 geographic allocations. South Africa is the largest at 13.53%, according to ALPS data.
“Following the removal of Russian-linked index constituents from all indexes, Russian-linked index constituents will be ineligible for inclusion in all Alerian S-Network Global Equity indexes until additional timetable for re-inclusion is agreed upon with the Alerian S-Network Index Committee,” adds the index provider.
The removal of Russian stocks from EDOG underscores the gravity of economic sanctions by the West against Russia and the impact those moves are having on the country's economy. For years, Russia was one of the largest emerging markets dividend payers, owing to its plethora of state-owned banks and energy companies.
The Kremlin often weighed on those companies to maintain, if not grow, dividends, making Russia a logical inclusion in EDOG. Today, EDOG yields 2.96%, nearly double the dividend yield on the MSCI Emerging Markets Index.
Even with the removal of Russian stocks, EDOG maintains a 13.35% weight to energy stocks – its largest sector allocation – confirming the fund is positioned to continue capitalizing on rising oil prices. And even with the Russia calamity, EDOG is beating the MSCI Emerging Markets Index by 100 basis points year-to-date.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The removal of Russian stocks from EDOG underscores the gravity of economic sanctions by the West against Russia and the impact those moves are having on the country's economy. For years, Russia was one of the largest emerging markets dividend payers, owing to its plethora of state-owned banks and energy companies.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). All Alerian S-Network indexes removed “all Russian-linked index constituents from all Alerian S-Network Equity Indexes effective from the open on Monday, March 7, 2022,” according to the index provider. Even with the removal of Russian stocks, EDOG maintains a 13.35% weight to energy stocks – its largest sector allocation – confirming the fund is positioned to continue capitalizing on rising oil prices.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is a prime example of an emerging markets ETF that, although it's passively managed, reacted swiftly to significantly reduce its Russia exposure amid that country instigating a war with neighboring Ukraine. “Following the removal of Russian-linked index constituents from all indexes, Russian-linked index constituents will be ineligible for inclusion in all Alerian S-Network Global Equity indexes until additional timetable for re-inclusion is agreed upon with the Alerian S-Network Index Committee,” adds the index provider.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). EDOG, which turns eight years old later this month, follows the S-Network Emerging Markets Index. As of March 10, EDOG's Russia exposure was just 0.43%, making that country by far the smallest of the dividend fund's 15 geographic allocations.
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06eb76c8-be50-49cb-a22b-696818036854
|
727085.0
|
2022-03-07 00:00:00 UTC
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WisdomTree Emerging Markets High Dividend Fund Getting Very Oversold
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DEM
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https://www.nasdaq.com/articles/wisdomtree-emerging-markets-high-dividend-fund-getting-very-oversold
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nan
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nan
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $42.43 per share. We define oversold territory using the Relative Strength Index, or RSI, which is a technical analysis indicator used to measure momentum on a scale of zero to 100. A stock is considered to be oversold if the RSI reading falls below 30.
In the case of WisdomTree Emerging Markets High Dividend Fund, the RSI reading has hit 29.6 — by comparison, the RSI reading for the S&P 500 is currently 38.0. A bullish investor could look at DEM's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $41.40 per share, with $47.66 as the 52 week high point — that compares with a last trade of $42.41. WisdomTree Emerging Markets High Dividend Fund shares are currently trading down about 2.7% on the day.
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A bullish investor could look at DEM's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $42.43 per share. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $41.40 per share, with $47.66 as the 52 week high point — that compares with a last trade of $42.41.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $42.43 per share. A bullish investor could look at DEM's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $41.40 per share, with $47.66 as the 52 week high point — that compares with a last trade of $42.41.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $42.43 per share. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $41.40 per share, with $47.66 as the 52 week high point — that compares with a last trade of $42.41. A bullish investor could look at DEM's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side.
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In trading on Monday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) entered into oversold territory, changing hands as low as $42.43 per share. A bullish investor could look at DEM's 29.6 reading as a sign that the recent heavy selling is in the process of exhausting itself, and begin to look for entry point opportunities on the buy side. Looking at a chart of one year performance (below), DEM's low point in its 52 week range is $41.40 per share, with $47.66 as the 52 week high point — that compares with a last trade of $42.41.
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37b4098a-e80a-4468-b8f2-6aee4d1726cc
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727086.0
|
2022-02-23 00:00:00 UTC
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Playing It Safe in Emerging Markets
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DEM
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https://www.nasdaq.com/articles/playing-it-safe-in-emerging-markets
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nan
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nan
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Emerging markets assets are dealing with bumps in the early innings of 2022, but with valuations looking attractive, investors may want to consider nibbling at the long-criticized asset class.
A potentially safe way of doing that is by commanding the power of dividends. Enter the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG). EDOG, which sports a dividend yield of 2.93%, is one of the few emerging markets exchange traded funds strutting its stuff in early 2022. The ALPS ETF is higher by 3.61%, while the MSCI Emerging Markets Index is modestly lower.
EDOG's early 2022 bullishness could prove to be a positive sign because many of the headwinds that hindered emerging markets equ
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EDOG, which sports a dividend yield of 2.93%, is one of the few emerging markets exchange traded funds strutting its stuff in early 2022. The ALPS ETF is higher by 3.61%, while the MSCI Emerging Markets Index is modestly lower. EDOG's early 2022 bullishness could prove to be a positive sign because many of the headwinds that hindered emerging markets equ
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Emerging markets assets are dealing with bumps in the early innings of 2022, but with valuations looking attractive, investors may want to consider nibbling at the long-criticized asset class. Enter the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG). EDOG, which sports a dividend yield of 2.93%, is one of the few emerging markets exchange traded funds strutting its stuff in early 2022.
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Emerging markets assets are dealing with bumps in the early innings of 2022, but with valuations looking attractive, investors may want to consider nibbling at the long-criticized asset class. EDOG, which sports a dividend yield of 2.93%, is one of the few emerging markets exchange traded funds strutting its stuff in early 2022. EDOG's early 2022 bullishness could prove to be a positive sign because many of the headwinds that hindered emerging markets equ
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Emerging markets assets are dealing with bumps in the early innings of 2022, but with valuations looking attractive, investors may want to consider nibbling at the long-criticized asset class. A potentially safe way of doing that is by commanding the power of dividends. Enter the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
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701da4bf-fa27-48ba-9d0c-478daabaf912
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727087.0
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2022-02-14 00:00:00 UTC
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7 Dividend ETFs to Buy For the Long Haul
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DEM
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https://www.nasdaq.com/articles/7-dividend-etfs-to-buy-for-the-long-haul
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nan
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nan
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
The good news in 2021 is that dividend payments were back after many companies cut or suspended their payments due to Covid-19. Dividend ETFs were the net beneficiary of this return to normalized payouts.
S&P 500 companies increased their dividends last year by more than $70 billion. Morningstar market strategist Dave Sekera believes some of the companies in the index need to up their dividends. However, he believes 2022 will be the year dividend payments return to following earnings.
Luckily for dividend ETFs, Sekera believes that even with rate hikes in 2022 to 1% from 0%, interest rates will still be at levels only seen once before, during the financial crisis of 2008.
So, the long and the short is that dividend-paying stocks should not be affected by what the Federal Reserve does over the next year.
7 Defensive Growth Stocks to Buy for February
Here are seven dividend ETFs to keep an eye on:
iShares International Select Dividend ETF (BATS:IDV)
Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO)
SPDR S&P Dividend ETF (NYSEARCA:SDY)
WisdomTree Emerging Markets High Dividend ETF (NYSEARCA:DEM)
Invesco Variable Rate Preferred ETF (NYSEARCA:VRP)
Pacer Global Cash Cows Dividend ETF (BATS:GCOW)
ProShares S&P MidCap 400 Dividend Aristocrats (BATS:REGL)
Dividend ETFs to Buy: iShares International Select Dividend ETF (IDV)
Source: Shutterstock
This iShares ETF is the first of two international funds. IDV tracks the performance of the Dow Jones EPAC Select Dividend Index, a collection of stocks in developed markets that have consistently provided high dividend yields over the long haul.
Launched in June 2007, IDV has a 30-day SEC yield of 4.81%. This provides investors with non-U.S. equity exposure while still generating above-average investment income.
The fund’s $4.8 billion in total net assets is invested in 100 companies of high dividend-paying companies in Europe, Pacific, Asia, Canada (EPAC). There are six criteria for qualifying for inclusion, including paying dividends for the most recent years, positive earnings per share for the trailing 12 months, and float-adjusted market capitalization of at least $1 billion.
This means the stocks included are reasonably large companies that consistently pay dividends and make money. What’s not to like?
The top three sectors by weight are financials (31%), utilities (19.3%), and materials (12.1%). The top three countries are the United Kingdom (23.8%), Canada (10.7%), and Hong Kong (10.1%).
The top 10 holdings account for 31% of the portfolio. The fund’s turnover is 86%, which means it rotates out of the entire portfolio once every little more than 12 months.
Amplify CWP Enhanced Dividend Income ETF (DIVO)
Source: Shutterstock
Amplify launched this interesting ETF in December 2016. On Feb. 7, its total net assets went over $1 billion for the first time.
Here’s what the company had to say about its ETF:
“DIVO is an actively-managed ETF featuring high-quality large-cap companies with a history of dividend growth utilizing a tactical covered call strategy on individual stocks.
“DIVO is strategically designed to offer high levels of total return on a risk-adjusted basis. The fund is actively managed by the ETF Sub-Adviser, Capital Wealth Planning, LLC (CWP).”
The company noted that its total assets grew by 356% over the past year. That’s a reflection of investors getting worried about the lengthy bull market coming to an end. DIVO is designed to protect on the downside while providing reasonable risk-adjusted returns.
Morningstar gives DIVO a five-star rating over the past year, three years, and five-year periods. It has an annual distribution rate of 4.7% and a 30-day SEC yield of 1.3%.
Why the 340 basis-point difference?
When an ETF pays out more than the fund generates in a particular period from interest, dividends, and capital gains, that is considered a return of capital. It reduces your adjusted cost base, which means you’ll have higher capital gains when you sell.
7 Industrial Stocks to Buy As Tech Stocks Tumble
That said, it’s not a bad price to pay for the ETF’s risk-adjusted returns. Over the past five years, it has generated an annualized total return of 13.9%. Year-to-date, it is down 4%, less than the market as a whole.
If you want an ETF that plays both offense and defense, DIVO is it.
Dividend ETFs to Buy: SPDR S&P Dividend ETF (SDY)
Source: Yuriy K / Shutterstock.com
SDY got its start 16 years ago this past November. It’s grown to $20.4 billion in total assets. That puts it in the top 100 U.S.-listed ETFs by total net assets.
The ETF tracks the performance of the S&P High Yield Dividend Aristocrats Index, a collection of the highest-yielding stocks from the S&P Composite 1500 Index that have increased their dividends for 20 consecutive years or more.
The weighted average market cap of the 119 holdings is $64.4 billion. However, the mixture of small-cap (25%), mid-cap (38%), and large-cap stocks (36%), makes it an excellent ETF to own if you like all-cap ETFs.
A lot of funds say they’re all-cap; SDY truly is. And all for an expense ratio of 0.35%.
From a sector perspective, the top three by weight are financials (17.1%), industrials (16.6%) and consumer defensive (14.9%). The top three holdings are Exxon Mobil (NYSE:XOM), IBM (NYSE:IBM) and Chevron (NYSE:CVX).
Its top 10 holdings account for 19% of the ETFs portfolio. It turns the entire portfolio once every 4.5 years.
Between 2012 and 2021, it had two years in negative territory out of 10. It had a total negative return of 0.73% in 2015 and 2.74% in 2018. In those 10 years, it had four years with an annual return of 20% or more.
Add this one as well to your list of two-way ETFs.
WisdomTree Emerging Markets High Dividend ETF (DEM)
Source: Shutterstock
Just as a properly constructed portfolio of non-dividend-paying equities should have a dollop of emerging markets represented, DEM is one of the pieces of the puzzle I’ve chosen to include in today’s group of ETFs.
I’ve always liked WisdomTree’s work in the dividend arena, so it only makes sense that DEM gets the call. Like the name of the fund, it’s designed to invest in companies based in emerging markets with higher than average dividend yields. DEM currently has a 5.5% yield.
The fund’s total net assets are $2.1 billion. It currently holds 492 stocks, with the top three holdings accounting for 15.9% of the portfolio — the top 10 account for 28% of the ETF’s total net assets.
The top three countries by weight are China (24.9%), Taiwan (19.4%) and Brazil (17.5%).
If you’re hesitant to invest in emerging markets, the average market cap is $16.9 billion, and large caps account for 74% of the portfolio.
7 Oil Stocks to Buy as Multiple Catalysts Converge
It charges 0.63%, which might seem high, but it’s the price you have to pay for increased income in emerging markets.
Dividend ETFs to Buy: Invesco Variable Rate Preferred ETF (VRP)
Source: Eviart / Shutterstock.com
It’s not often I’ll recommend a preferred share ETF, let alone one with variable rate in the name.
What precisely is variable rate? I’ll get to that. But first, let’s consider how the fund is constructed.
VRP tracks the performance of the ICE Variable Rate Preferred & Hybrid Securities Index. The index is a group of preferred shares that are both floating and variable rate U.S. dollar-denominated preferred stock and hybrid debt of U.S. companies. They can be both investment grade and below investment grade.
It’s important to note that the ETFs index changed in June 2021. As a result, the index provider changed from Wells Fargo to ICE Data Indices, LLC.
Risks associated with investing in preferred shares include the fact the issuer may have provisions in the shares that allow for the pausing of distributions for a period of time. That could affect the preferred share’s price. Further, even though the distributions have paused, the ETF might have to report the distribution even though it didn’t get the money.
In addition, preferred shares generally don’t have voting rights and often rank behind all bonds and other debt instruments in terms of repayment. Therefore, it’s important to understand that these securities aren’t as straightforward as equities, but they can play an effective role in one’s portfolio.
VRP currently has 313 preferred shares invested in the ETF’s $2.0 billion in total net assets. It has a 30-day SEC yield of 3.76%. The average coupon of the holdings is 5.19%, while the effective duration is 2.91 years.
The credit quality rating of most of the preferreds is BB or BBB, which account for 94% of the portfolio. It charges 0.50%. I don’t spend much time in the bond area, but it doesn’t seem out of line relative to other preferred share offerings.
Pacer Global Cash Cows Dividend ETF (GCOW)
Source: Reel2Reel/shutterstock.com
I love free cash flow. I always have. Even better, I love investing in companies that know how to effectively allocate that free cash flow. It isn’t as easy as it seems.
As you might be aware, dividends are generally paid from free cash flow. It is one of the five uses for free cash flow. The others are share repurchases, debt repayment, acquisitions and investing in the business.
GCOW, like some of Pacer’s other ETFs, focuses on free cash flow, and more importantly, high free cash flow yields. The ETF tracks the performance of the Pacer Global Cash Cows Dividend Index, hence the name.
The index starts with the FTSE All-World Developed Large Cap Index. It then knocks out companies that are expected to have negative free cash flow or earnings over the next two years. It also removes all financial-related companies except for real estate investment trusts.
What’s left is ranked by their free cash flow yield for the trailing 12 months. It takes the top 300 and ranks them again, this time by dividend yield. The 100 top dividend yields are included in the index. Each holding is capped at 2%. It rebalances and reconstitutes twice a year in June and December.
The 7 Highest Dividend Stocks for Income Investors
Its 30-day SEC yield is 4.33%. It charges 0.60%, which is a little high for its long-term performance, but it’s important to remember that 68% of the portfolio are holdings outside the U.S. They haven’t done nearly as well over the past decade.
Reversion to the mean makes GCOW attractive right now.
Dividend ETFs to Buy: ProShares S&P MidCap 400 Dividend Aristocrats (REGL)
Source: Shutterstock
REGL is the second ETF on this list that focuses on Dividend Aristocrats. However, REGL tends to focus on mid-cap stocks. So, unlike SDY, which had a weighted average market cap of $64.4 billion, this ETFs average is just $7.2 billion, putting it right in the heart of mid-cap stocks.
In fact, it leans heavily into small-cap territory. Small caps account for 69% of the portfolio. Mid caps have a 31% weighting. There are no large caps.
REGL tracks the performance of the S&P MidCap 400 Dividend Aristocrats Index, which is a collection of at least 40 stocks that have increased dividends for 15 years or more. The holdings are equally weighted. The index rebalances four times a year in January, April, July and October. It is reconstituted every January. No sector can account for more than 30% of the index.
The ETF currently has 49 stocks invested in its $1.1 billion in total net assets. It has a 30-day SEC yield of 2%. If you invested $10,000 at its inception in February 2015, it would be worth $20,244 today.
The average investor might be familiar with two or three names in the top 10 holdings. They account for 21% of the portfolio. That’s a result of equal weighting.
I consider mid-cap stocks to be an important part of every portfolio.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Will Ashworth has written about investments full-time since 2008. Publications where he’s appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.
The post 7 Dividend ETFs to Buy For the Long Haul appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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7 Defensive Growth Stocks to Buy for February Here are seven dividend ETFs to keep an eye on: iShares International Select Dividend ETF (BATS:IDV) Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO) SPDR S&P Dividend ETF (NYSEARCA:SDY) WisdomTree Emerging Markets High Dividend ETF (NYSEARCA:DEM) Invesco Variable Rate Preferred ETF (NYSEARCA:VRP) Pacer Global Cash Cows Dividend ETF (BATS:GCOW) ProShares S&P MidCap 400 Dividend Aristocrats (BATS:REGL) Dividend ETFs to Buy: iShares International Select Dividend ETF (IDV) Source: Shutterstock This iShares ETF is the first of two international funds. WisdomTree Emerging Markets High Dividend ETF (DEM) Source: Shutterstock Just as a properly constructed portfolio of non-dividend-paying equities should have a dollop of emerging markets represented, DEM is one of the pieces of the puzzle I’ve chosen to include in today’s group of ETFs. I’ve always liked WisdomTree’s work in the dividend arena, so it only makes sense that DEM gets the call.
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7 Defensive Growth Stocks to Buy for February Here are seven dividend ETFs to keep an eye on: iShares International Select Dividend ETF (BATS:IDV) Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO) SPDR S&P Dividend ETF (NYSEARCA:SDY) WisdomTree Emerging Markets High Dividend ETF (NYSEARCA:DEM) Invesco Variable Rate Preferred ETF (NYSEARCA:VRP) Pacer Global Cash Cows Dividend ETF (BATS:GCOW) ProShares S&P MidCap 400 Dividend Aristocrats (BATS:REGL) Dividend ETFs to Buy: iShares International Select Dividend ETF (IDV) Source: Shutterstock This iShares ETF is the first of two international funds. WisdomTree Emerging Markets High Dividend ETF (DEM) Source: Shutterstock Just as a properly constructed portfolio of non-dividend-paying equities should have a dollop of emerging markets represented, DEM is one of the pieces of the puzzle I’ve chosen to include in today’s group of ETFs. I’ve always liked WisdomTree’s work in the dividend arena, so it only makes sense that DEM gets the call.
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7 Defensive Growth Stocks to Buy for February Here are seven dividend ETFs to keep an eye on: iShares International Select Dividend ETF (BATS:IDV) Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO) SPDR S&P Dividend ETF (NYSEARCA:SDY) WisdomTree Emerging Markets High Dividend ETF (NYSEARCA:DEM) Invesco Variable Rate Preferred ETF (NYSEARCA:VRP) Pacer Global Cash Cows Dividend ETF (BATS:GCOW) ProShares S&P MidCap 400 Dividend Aristocrats (BATS:REGL) Dividend ETFs to Buy: iShares International Select Dividend ETF (IDV) Source: Shutterstock This iShares ETF is the first of two international funds. WisdomTree Emerging Markets High Dividend ETF (DEM) Source: Shutterstock Just as a properly constructed portfolio of non-dividend-paying equities should have a dollop of emerging markets represented, DEM is one of the pieces of the puzzle I’ve chosen to include in today’s group of ETFs. I’ve always liked WisdomTree’s work in the dividend arena, so it only makes sense that DEM gets the call.
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7 Defensive Growth Stocks to Buy for February Here are seven dividend ETFs to keep an eye on: iShares International Select Dividend ETF (BATS:IDV) Amplify CWP Enhanced Dividend Income ETF (NYSEARCA:DIVO) SPDR S&P Dividend ETF (NYSEARCA:SDY) WisdomTree Emerging Markets High Dividend ETF (NYSEARCA:DEM) Invesco Variable Rate Preferred ETF (NYSEARCA:VRP) Pacer Global Cash Cows Dividend ETF (BATS:GCOW) ProShares S&P MidCap 400 Dividend Aristocrats (BATS:REGL) Dividend ETFs to Buy: iShares International Select Dividend ETF (IDV) Source: Shutterstock This iShares ETF is the first of two international funds. WisdomTree Emerging Markets High Dividend ETF (DEM) Source: Shutterstock Just as a properly constructed portfolio of non-dividend-paying equities should have a dollop of emerging markets represented, DEM is one of the pieces of the puzzle I’ve chosen to include in today’s group of ETFs. I’ve always liked WisdomTree’s work in the dividend arena, so it only makes sense that DEM gets the call.
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7dcc7ba0-9cd1-4d5b-a5fe-14d2df2dc4f2
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727088.0
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2022-02-08 00:00:00 UTC
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EDOG Excellent Avenue to Emerging Markets Value
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DEM
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https://www.nasdaq.com/articles/edog-excellent-avenue-to-emerging-markets-value
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nan
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nan
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Domestic value stocks and exchange traded funds are holding up well to start 2022 and, in many cases, are outperforming broader benchmarks.
The same phenomenon is on display with emerging markets stocks. While the MSCI Emerging Markets Index is lower by 0.59% year-to-date, the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is higher to start 2022.
That's not a new trend. Albeit quietly, emerging markets value stocks have been outperforming broader benchmarks of stocks in developing economies for several months, and some market observers believe that this will continue, providing support for the EDOG thesis.
“That’s just the start of a rebound in emerging markets value stocks, long-suffering enthusiasts hope. They certainly have a valuation argument. The cheapest 20% of emerging market stocks, measured by price/earnings ratios, are way into all-time lows relative to the rest of the asset class, notes Arjun Divecha, head of emerging markets equity at GMO,” reports Craig Mellow for Barron's.
The idea of a growth-to-value rotation in emerging markets has credibility because the prior two emerging markets bull runs were led by growth stocks, but that group fell on hard times last year due in large part to China's ambitious regulatory crackdown that focused on internet companies.
Fortunately, EDOG is a value-oriented ETF, meaning that it leans away from controversial Chinese growth stocks. Add to that, the fund equally weights its geographic exposures, meaning its 9.83% weight to China is significantly below what's found in traditional emerging markets indexes.
“Dividends are a big part of the draw for emerging markets value, however defined. Randolph Wrighton, portfolio manager for emerging markets at Barrow Hanley, is piling into banks, partly for their payouts,” according to Barron's.
EDOG's sector allocations are also equally weighted so its financial services exposure stands at 10.28% today, making it the second-largest sector weight in the ETF, behind energy at 11.07%.
Speaking of dividends, emerging markets payouts are forecast to rise this year, providing support for the EDOG investment thesis. The fund already yields 2.92%, well above the trailing 12-month yield of 2% found on the MSCI Emerging Markets Index.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The idea of a growth-to-value rotation in emerging markets has credibility because the prior two emerging markets bull runs were led by growth stocks, but that group fell on hard times last year due in large part to China's ambitious regulatory crackdown that focused on internet companies. Randolph Wrighton, portfolio manager for emerging markets at Barrow Hanley, is piling into banks, partly for their payouts,” according to Barron's.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Albeit quietly, emerging markets value stocks have been outperforming broader benchmarks of stocks in developing economies for several months, and some market observers believe that this will continue, providing support for the EDOG thesis. Add to that, the fund equally weights its geographic exposures, meaning its 9.83% weight to China is significantly below what's found in traditional emerging markets indexes.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Albeit quietly, emerging markets value stocks have been outperforming broader benchmarks of stocks in developing economies for several months, and some market observers believe that this will continue, providing support for the EDOG thesis. The idea of a growth-to-value rotation in emerging markets has credibility because the prior two emerging markets bull runs were led by growth stocks, but that group fell on hard times last year due in large part to China's ambitious regulatory crackdown that focused on internet companies.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Domestic value stocks and exchange traded funds are holding up well to start 2022 and, in many cases, are outperforming broader benchmarks. While the MSCI Emerging Markets Index is lower by 0.59% year-to-date, the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is higher to start 2022.
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f38ed92a-f48d-4a12-ac45-855e446179bc
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727089.0
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2022-01-24 00:00:00 UTC
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This EM ETF Has Inflation-Fighting Capabilities
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DEM
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https://www.nasdaq.com/articles/this-em-etf-has-inflation-fighting-capabilities
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nan
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nan
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When looking to combat rising inflation in the U.S., investors typically turn to domestic assets, but when properly structured, emerging markets can offer market participants some buffer against soaring consumer prices.
The WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is an example of an exchange traded fund that, in this case, checks the properly structured box. Coming off a 2021 in which it handily outperformed the MSCI Emerging Markets Index, DEM could repeat that feat this year, as its inflation-fighting properties are arguably superior to those of the emerging markets benchmark.
“DEM is over-weight in the most inflation-sensitive sectors—Financials, Real Estate, Materials and Energy—making it a prime candidate, we believe, for investors in search of inflation hedges,” says WisdomTree analyst Matt Wagner. “Unlike the 2000s, the current sector weights of the broad MSCI EM Index skew more toward technology and tech-enabled companies, making it less of a beneficiary of a potential commodity supercycle.”
By way of being heavily allocated to those sectors, DEM is, not surprisingly, a value play. While value isn't 100% immune to the calamity sweeping financial markets to start 2022, it's the preferred option to growth, as growth's recent performances suggest. DEM confirms as much, as it's beating the growthier MSCI Emerging Markets Index by 360 basis points since the start of 2022.
“Conversely, value stocks that have higher current cash flows and pay out higher dividends are more positively impacted,” adds Wagner. “Out of all of WisdomTree’s ETFs, no product screens higher on value and income than DEM with its dividend yield more than 7% and a 6x price-to-earnings multiple.”
DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), has other advantages. For example, the ETF is significantly underweight to China relative to traditional emerging markets benchmarks, and it features no exposure to the Chinese growth stocks that are vulnerable to regulatory headwinds because those companies aren't dividend-payers.
Avoiding Chinese growth fare is likely one reason why DEM significantly outpaced traditional rivals in 2021, but that doesn't mean that the fund lacks exposure to tech-heavy markets. For example, Taiwan accounts for nearly 20% of the ETF's weight.
“On an aggregate country basis, DEM is under-weight in China by 9%, with a more modest 25% weight as of December 31, 2021,” concludes Wagner. “With just a 15% holdings overlap to MSCI EM, DEM can be a useful complementary EM allocation to dial back exposure to China-tech headline risk or used in isolation to navigate the themes we’ve highlighted for this year.”
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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“DEM is over-weight in the most inflation-sensitive sectors—Financials, Real Estate, Materials and Energy—making it a prime candidate, we believe, for investors in search of inflation hedges,” says WisdomTree analyst Matt Wagner. Avoiding Chinese growth fare is likely one reason why DEM significantly outpaced traditional rivals in 2021, but that doesn't mean that the fund lacks exposure to tech-heavy markets. The WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is an example of an exchange traded fund that, in this case, checks the properly structured box.
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The WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is an example of an exchange traded fund that, in this case, checks the properly structured box. Coming off a 2021 in which it handily outperformed the MSCI Emerging Markets Index, DEM could repeat that feat this year, as its inflation-fighting properties are arguably superior to those of the emerging markets benchmark. “Out of all of WisdomTree’s ETFs, no product screens higher on value and income than DEM with its dividend yield more than 7% and a 6x price-to-earnings multiple.” DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), has other advantages.
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The WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is an example of an exchange traded fund that, in this case, checks the properly structured box. Coming off a 2021 in which it handily outperformed the MSCI Emerging Markets Index, DEM could repeat that feat this year, as its inflation-fighting properties are arguably superior to those of the emerging markets benchmark. “Out of all of WisdomTree’s ETFs, no product screens higher on value and income than DEM with its dividend yield more than 7% and a 6x price-to-earnings multiple.” DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), has other advantages.
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The WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is an example of an exchange traded fund that, in this case, checks the properly structured box. “Out of all of WisdomTree’s ETFs, no product screens higher on value and income than DEM with its dividend yield more than 7% and a 6x price-to-earnings multiple.” DEM, which tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), has other advantages. Avoiding Chinese growth fare is likely one reason why DEM significantly outpaced traditional rivals in 2021, but that doesn't mean that the fund lacks exposure to tech-heavy markets.
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0f92835f-51e0-41e7-8110-6d8aa6e31d25
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727090.0
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2022-01-18 00:00:00 UTC
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Emerging Markets Dividends Can Reward Again in 2022
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DEM
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https://www.nasdaq.com/articles/emerging-markets-dividends-can-reward-again-in-2022
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nan
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nan
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Following dark days in 2020, global dividends rebounded by 21% last year, and emerging markets got in on the act.
In fact, dividend-payers provided a superior avenue for emerging markets equity exposure last year. Take the case of the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). That exchange traded fund gained 11.5% last year while the widely followed MSCI Emerging Markets Index slid 3.6%.
DEM follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. However, the fund is still levered to payout growth in developing economies, and that's something to consider as global dividends are forecast to rise by 6% this year.
“Though aggregate dividend payouts increased in 2021, the pandemic created starkly uneven paths across countries and sectors. Compared to their pre-pandemic level, dividends increased strongly in Asia Pacific, grew moderately in the Americas and saw a minimal rebound in Europe. Although the technology sector has boomed, travel, leisure and automotive still face an uphill climb,” said Clara Besson, EMEA dividend research lead, IHS Markit.
The research firm notes that while “each region will see dividend payout growth,” the intensity of payout increases will vary at the regional and sector levels. Fortunately, DEM is heavily allocated to some sectors that are expected to be prodigious growers of dividends this year. That includes an almost 26% weight to financial services stocks.
“Banks, the top dividend payer among sectors, will distribute more than 283 billion USD in payouts, with the expectation that banks will prefer buybacks over dividends payouts this year,” adds IHS Markit.
The research firm also forecasts that dividend growth in emerging markets will jump 23% this year, easily outpacing increases in developed markets. That's a point in DEM's favor, as is the fact that the WisdomTree ETF was 400 basis points less volatile than the MSCI Emerging Markets Index in 2021.
Another advantage offered by DEM is that the fund allocates over 22% of its weight to the technology and energy sectors, which are slated to be two leading sources of global dividend growth this year.
“The oil and gas sector will continue to recover with payouts expected to reach 274 billion USD in 2022, up from 225 billion USD in 2021,” according to Markit.
Up 4.16% to start 2022, DEM yields 4.48%.
For more news, information, and strategy, visit the Modern Alpha Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Compared to their pre-pandemic level, dividends increased strongly in Asia Pacific, grew moderately in the Americas and saw a minimal rebound in Europe. Another advantage offered by DEM is that the fund allocates over 22% of its weight to the technology and energy sectors, which are slated to be two leading sources of global dividend growth this year. Take the case of the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
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Take the case of the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). DEM follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. “Though aggregate dividend payouts increased in 2021, the pandemic created starkly uneven paths across countries and sectors.
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Another advantage offered by DEM is that the fund allocates over 22% of its weight to the technology and energy sectors, which are slated to be two leading sources of global dividend growth this year. Take the case of the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). DEM follows the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark.
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That's a point in DEM's favor, as is the fact that the WisdomTree ETF was 400 basis points less volatile than the MSCI Emerging Markets Index in 2021. Another advantage offered by DEM is that the fund allocates over 22% of its weight to the technology and energy sectors, which are slated to be two leading sources of global dividend growth this year. Take the case of the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
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2bdeade4-3657-4d7f-97a1-88ed3774c58d
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727091.0
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2022-01-11 00:00:00 UTC
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Bullish Two Hundred Day Moving Average Cross - DEM
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DEM
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https://www.nasdaq.com/articles/bullish-two-hundred-day-moving-average-cross-dem
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nan
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nan
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.68, changing hands as high as $44.80 per share. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.7% on the day. The chart below shows the one year performance of DEM shares, versus its 200 day moving average:
Looking at the chart above, DEM's low point in its 52 week range is $40.4301 per share, with $47.62 as the 52 week high point — that compares with a last trade of $44.79.
Click here to find out which 9 other ETFs recently crossed above their 200 day moving average »
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.68, changing hands as high as $44.80 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.4301 per share, with $47.62 as the 52 week high point — that compares with a last trade of $44.79. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.7% on the day.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.68, changing hands as high as $44.80 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.4301 per share, with $47.62 as the 52 week high point — that compares with a last trade of $44.79. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.7% on the day.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.68, changing hands as high as $44.80 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.4301 per share, with $47.62 as the 52 week high point — that compares with a last trade of $44.79. Click here to find out which 9 other ETFs recently crossed above their 200 day moving average » The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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In trading on Tuesday, shares of the WisdomTree Emerging Markets High Dividend Fund ETF (Symbol: DEM) crossed above their 200 day moving average of $44.68, changing hands as high as $44.80 per share. The chart below shows the one year performance of DEM shares, versus its 200 day moving average: Looking at the chart above, DEM's low point in its 52 week range is $40.4301 per share, with $47.62 as the 52 week high point — that compares with a last trade of $44.79. WisdomTree Emerging Markets High Dividend Fund shares are currently trading up about 1.7% on the day.
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8abc4687-3bf1-48ed-a062-1c030500692c
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727092.0
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2021-12-20 00:00:00 UTC
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Evaluate EDOG for Long-Term Emerging Markets Exposure
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DEM
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https://www.nasdaq.com/articles/evaluate-edog-for-long-term-emerging-markets-exposure
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nan
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nan
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Broader emerging markets equity benchmarks are cruising toward another disappointing annual performance, and while many investors are considering abandoning the asset class, they might want to reconsider.
One way of getting more comfortable with emerging markets stocks ahead of 2022 is to identify this year's leaders. The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) makes that easy because the exchange traded fund is easily outpacing the MSCI Emerging Markets Index this year.
Additionally, it pays to remember that emerging markets stocks and the S&P 500 don't move in unison over long holdings, indicating that there are benefits to considering EDOG as an addition to domestic-heavy equity portfolios.
“Numerous studies, including those by Vanguard and Morgan Stanley, show that over extended periods, the stock returns of emerging markets and developed countries like the United States don’t move in lock step most of the time,” reports Jeff Summer for The New York Times. “Over the long term, this low correlation means that adding emerging market exposure to predominantly American investments can reduce the overall portfolio’s volatility and enhance returns.”
Not surprisingly, the near-term outlook is murky for emerging markets stocks. The asset class rarely responds well in advance of Federal Reserve rate tightening, which is expected to happen next year, because many governments in developing economies issue dollar-denominated debt.
On the bright side, emerging markets central banks are ahead of the Fed in terms of raising rates, and that could pay dividends in terms of damping inflation in 2022. For its part, EDOG offers the diversification investors need to avoid large allocations to China and other potential trouble spots in developing economies.
“Over the last 20 years or so, they have become a standard part of many long-term, diversified stock and bond portfolios, especially those made up of low-cost index funds,” according to the Times.
EDOG yields 2.96%, or 140 basis points ahead of the MSCI Emerging Markets Index. Speaking of income, emerging markets dividends are rebounding, and market observers are forecasting more growth in 2022. Rising payouts could diminish risk and support some upside for emerging markets stocks in what could be a bumpy 2022.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Broader emerging markets equity benchmarks are cruising toward another disappointing annual performance, and while many investors are considering abandoning the asset class, they might want to reconsider. The asset class rarely responds well in advance of Federal Reserve rate tightening, which is expected to happen next year, because many governments in developing economies issue dollar-denominated debt.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). One way of getting more comfortable with emerging markets stocks ahead of 2022 is to identify this year's leaders. The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) makes that easy because the exchange traded fund is easily outpacing the MSCI Emerging Markets Index this year.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) makes that easy because the exchange traded fund is easily outpacing the MSCI Emerging Markets Index this year. “Over the long term, this low correlation means that adding emerging market exposure to predominantly American investments can reduce the overall portfolio’s volatility and enhance returns.” Not surprisingly, the near-term outlook is murky for emerging markets stocks.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) makes that easy because the exchange traded fund is easily outpacing the MSCI Emerging Markets Index this year. “Over the last 20 years or so, they have become a standard part of many long-term, diversified stock and bond portfolios, especially those made up of low-cost index funds,” according to the Times.
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ae1a21d0-10f8-4424-9103-c4d8c30f6c56
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727093.0
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2021-12-15 00:00:00 UTC
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A Prudent Approach to Emerging Markets in 2022
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DEM
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https://www.nasdaq.com/articles/a-prudent-approach-to-emerging-markets-in-2022
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nan
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nan
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With the widely followed MSCI Emerging Markets Index down 6% year-to-date, it's understandable that investors aren't enthusiastic about emerging markets equities heading into 2022.
Some professional investors are expressing the same sentiment, further compounding retail investors' trepidation about developing economies in 2022. However, there are some dissenting points of view, and market participants bold enough to embrace those could be rewarded in the new year.
Investors mulling over emerging markets exposure for the new year should consider being compensated for that risk. That objective is achievable with the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG). EDOG, which tracks the S-Network® Emerging Sector Dividend Dogs Index, offers some perks relative to competing prosaic strategies. Still, the coronavirus pandemic remains an issue to consider.
“While this marked a reversal of what happened in 2020, when Asian economies handled Covid better, this low base should provide tailwinds to the recovery alongside other factors such as brighter household finances that were supported by fiscal measures,” according to BNP Paribas research. “We should also note the positive wealth effect that fiscal and monetary support has created in many developed economies and the boost to demand that has engineered. That should rub off on a lot of emerging markets.”
EDOG features exposure to six Asian economies, but in the fund's favor is a mere 9.58% allocation to Chinese stocks, while many standard emerging markets ETFs allocate roughly a third of their weights to that country. That goes a long way in explaining why EDOG is in the green this year while the MSCI Emerging Markets is in the red.
Another issue for investors to ponder is central bank action in 2022 — both the Federal Reserve and emerging markets banks. Fortunately, many central banks in developing economies already commenced boosting borrowing costs to combat inflation.
“Here, we believe that the balance sheets of most Asian emerging economies are quite healthy, so more resilient, when compared to these of the economies of eastern Europe, Africa and Latin America. The outlook, though, will depend on the pace and the extent of US interest-rate increases, especially given the recent more hawkish comments from the Federal Reserve chair on inflation,” adds BNP Paribas.
Bottom line: With so many market participants so dour on emerging markets, a contrarian view could reward investors, and EDOG could be the way to play that theme.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Still, the coronavirus pandemic remains an issue to consider. “We should also note the positive wealth effect that fiscal and monetary support has created in many developed economies and the boost to demand that has engineered. Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Still, the coronavirus pandemic remains an issue to consider. “We should also note the positive wealth effect that fiscal and monetary support has created in many developed economies and the boost to demand that has engineered.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Still, the coronavirus pandemic remains an issue to consider. “We should also note the positive wealth effect that fiscal and monetary support has created in many developed economies and the boost to demand that has engineered.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Still, the coronavirus pandemic remains an issue to consider. “We should also note the positive wealth effect that fiscal and monetary support has created in many developed economies and the boost to demand that has engineered.
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596fe084-d38b-42e3-8be2-a4c65f2b10b4
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727094.0
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2021-11-22 00:00:00 UTC
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Emerging Markets Dividend Renaissance Is Here
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DEM
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https://www.nasdaq.com/articles/emerging-markets-dividend-renaissance-is-here
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nan
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nan
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The recent round of positive dividend news centers largely on U.S. stocks, but investors shouldn't sleep on rising payouts in other parts of the world.
Data confirm emerging markets payouts are perking up in a big way, meaning it could be an opportune time for investors to revisit exchange traded funds such as the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG).
The third-quarter reading of the Janus Henderson Global Dividend Index confirms the allure of the emerging markets dividend opportunity, potentially giving investors reason to evaluate EDOG. In the September quarter, headline payout growth in developing economies was 31%, according to the index. That's nearly triple the dividend growth rate of 10.5% in North America. In Asia ex-Japan, a region including plenty of emerging markets, dividends surged 37.9%.
EDOG, which tracks the S-Network® Emerging Sector Dividend Dogs Index, features exposure to six Asian economies. Led by Thailand, those countries combine for almost half of EDOG's geographic weight.
“China’s big dividend season takes place in the third quarter. Payouts rose to $32.6 billion, an increase of 15.7% on an underlying basis, putting Chinese companies on track to deliver record dividends this year for the second year running,” according to Janus Henderson.
EDOG also has some right place, right time sector allocations with which to capitalize on new-found emerging markets dividend ebullience.
“The lifting of constraints on banking dividends, along with lower-than-expected loan impairments, and hence higher profits, pushed overall payouts from financials up by a third on an underlying basis. Collectively they accounted for a quarter of the Q3 total,” adds Janus Henderson.
Another source of global dividend strength, including emerging markets, is the energy sector, a group EDOG has ample exposure with the help of a 10.7% weight to Russia. Financial services and energy stocks combine for almost 20% of EDOG's roster.
In the third quarter, seven of the world's top 20 dividend payers were companies based in developing economies. That's the same amount on that list hailing from the U.S. EDOG yields 3.03%. That's more than double the trailing 12-month yield on the MSCI Emerging Markets Index.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more news, information, and strategy, visit the ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The recent round of positive dividend news centers largely on U.S. stocks, but investors shouldn't sleep on rising payouts in other parts of the world. “The lifting of constraints on banking dividends, along with lower-than-expected loan impairments, and hence higher profits, pushed overall payouts from financials up by a third on an underlying basis.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Data confirm emerging markets payouts are perking up in a big way, meaning it could be an opportune time for investors to revisit exchange traded funds such as the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG). The third-quarter reading of the Janus Henderson Global Dividend Index confirms the allure of the emerging markets dividend opportunity, potentially giving investors reason to evaluate EDOG.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Data confirm emerging markets payouts are perking up in a big way, meaning it could be an opportune time for investors to revisit exchange traded funds such as the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG). The third-quarter reading of the Janus Henderson Global Dividend Index confirms the allure of the emerging markets dividend opportunity, potentially giving investors reason to evaluate EDOG.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). The third-quarter reading of the Janus Henderson Global Dividend Index confirms the allure of the emerging markets dividend opportunity, potentially giving investors reason to evaluate EDOG. Another source of global dividend strength, including emerging markets, is the energy sector, a group EDOG has ample exposure with the help of a 10.7% weight to Russia.
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22b90089-c1a3-408e-834d-e2c0e80e3053
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727095.0
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2021-11-02 00:00:00 UTC
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3 High Dividend ETFs for High Income
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DEM
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https://www.nasdaq.com/articles/3-high-dividend-etfs-for-high-income-2021-11-02
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nan
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nan
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T
en-year Treasury yields are moving higher as of late, residing at 1.575% as of Nov. 1, but that's low by historical standards and presents challenges to income investors. The S&P 500 isn't much better. It's actually worse in yield terms at just 1.30%. So it's no wonder investors are craving high dividend exchange traded funds again.
In simple terms, many high dividend ETFs follow yield-weighting methodologies, meaning components in those funds are weighted according to dividend yield or yield is combined with other metrics. It's a strategy many investors like and one that often works well when interest rates are low as is the case today. That's a reminder that high dividend stocks usually hail from interest rate-sensitive sectors, such as real estate and utilities and can be crimped when rates rise.
Combine the rate risk with the fact some high dividend companies are under financial duress and could be dividend offenders in the future – the rampant dividend cutting seen in 2020 is a case study in that scenario – and it's a wonder why investors embrace high dividend ETFs.
This year, it's understandable. Dividends are growing again and income investors' hands are being forced by low interest rates. With that in mind, here are some interesting, potentially safer options among high dividend ETFs to consider.
ALPS Sector Dividend Dogs ETF (SDOG)
The ALPS Sector Dividend Dogs ETF is a high dividend ETF built for the current market environment because it employs an equal-weight strategy to its sector allocations, meaning it's significantly overweight energy stocks relative to traditional broad market indexes. That's a plus considering that energy is the best-performing sector in the S&P 500 this year.
SDOG yields north of 3% and is up 18% year-to-date – an impressive showing when factoring in that the ETF has no exposure to real estate stocks. Real estate is the second-best sector this year behind energy. Enhancing the allure of SDOG relative to other high dividend funds is that there's more of an element of quality here than meets the eye, indicating its member firms' dividends are sustainable.
“The S-Network Sector Dividend Dogs Index (SDOGX) offers attractive income from quality companies, with investment-grade companies representing over 86% of the index by weighting,” says Alerian analyst Stacey Morris. “Multiple screens for dividend durability, including evaluating cash flows, EBITDA, and debt-to-equity ratios, help ensure reliable income from the durable dividend indexes. While current yields are below the 5-year average, they are well above the S&P 500’s current 1.41% yield.”
Invesco S&P 500 High Dividend Low Volatility ETF (SPHD)
The Invesco S&P 500 High Dividend Low Volatility ETF is a best of both worlds proposition of income-hungry for conservative income investors. SPHD has a tidy 12-month distribution rate of 3.72% and it's designed to be a lower volatility dividend solution.
The fund tracks the S&P 500 Low Volatility High Dividend Index, which is a collection of the 50 S&P 500 members with the highest dividend yields and lowest volatility. To be precise, SPHD holds 51 stocks.
Low volatility ETFs are intended to be sector agnostic, but the low volatility objective often leads these funds, including SPHD, to familiar sectors. That's doubly true when adding the dividend overlay. To that end, SPHD allocates 38% of its weight to utilities and consumer staples stocks.
Investors looking for growth fare might want to steer clear of this fund as over 80% of its holdings are classified as value stocks and none sport the growth label.
WisdomTree Emerging Markets High Dividend Fund (DEM)
While home country bias runs deep among American investors, those seeking income should realize there are some credible dividend destinations in developing economies. Enter the WisdomTree Emerging Markets High Dividend Fund – one of the original ETFs in this category.
DEM follows the WisdomTree Emerging Markets High Dividend Index, which takes the top 30% of the members of the WisdomTree Emerging Markets Dividend Index based on dividend and then weights those stocks on the basis of cash dividends paid.
DEM's 4.53% dividend yield is an obvious point of attraction, but there's more to this fund's story. It has significant commodities and value exposure. For example, Brazil, Russia and South Africa – all commodities-rich countries – combine for about 31.6% of the fund's weight. Those exposures are making a difference as DEM is up nearly 6% year-to-date while the MSCI Emerging Markets Index is in the red.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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WisdomTree Emerging Markets High Dividend Fund (DEM) While home country bias runs deep among American investors, those seeking income should realize there are some credible dividend destinations in developing economies. DEM follows the WisdomTree Emerging Markets High Dividend Index, which takes the top 30% of the members of the WisdomTree Emerging Markets Dividend Index based on dividend and then weights those stocks on the basis of cash dividends paid. DEM's 4.53% dividend yield is an obvious point of attraction, but there's more to this fund's story.
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WisdomTree Emerging Markets High Dividend Fund (DEM) While home country bias runs deep among American investors, those seeking income should realize there are some credible dividend destinations in developing economies. DEM follows the WisdomTree Emerging Markets High Dividend Index, which takes the top 30% of the members of the WisdomTree Emerging Markets Dividend Index based on dividend and then weights those stocks on the basis of cash dividends paid. DEM's 4.53% dividend yield is an obvious point of attraction, but there's more to this fund's story.
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DEM follows the WisdomTree Emerging Markets High Dividend Index, which takes the top 30% of the members of the WisdomTree Emerging Markets Dividend Index based on dividend and then weights those stocks on the basis of cash dividends paid. WisdomTree Emerging Markets High Dividend Fund (DEM) While home country bias runs deep among American investors, those seeking income should realize there are some credible dividend destinations in developing economies. DEM's 4.53% dividend yield is an obvious point of attraction, but there's more to this fund's story.
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DEM follows the WisdomTree Emerging Markets High Dividend Index, which takes the top 30% of the members of the WisdomTree Emerging Markets Dividend Index based on dividend and then weights those stocks on the basis of cash dividends paid. WisdomTree Emerging Markets High Dividend Fund (DEM) While home country bias runs deep among American investors, those seeking income should realize there are some credible dividend destinations in developing economies. DEM's 4.53% dividend yield is an obvious point of attraction, but there's more to this fund's story.
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6f5b30e6-8ab0-47b9-954f-83c901ac6846
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727096.0
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2021-10-27 00:00:00 UTC
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Make Commodities Call for Emerging Markets Value
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DEM
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https://www.nasdaq.com/articles/make-commodities-call-for-emerging-markets-value-2021-10-27
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nan
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nan
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Domestic value stocks are garnering ample attention this year, and the returns are there to match. Some of that scenario is attributable to rising commodities prices.
In other words, cyclical value is working in 2021, but investors should note that this is not a distinctly domestic phenomenon. For example, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is higher by 9% year-to-date while the MSCI Emerging Markets Index is up a paltry 1.24%.
DEM, which has nearly $2 billion in assets under management, tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. Indeed, the fund sports a dividend yield of 4.44%, which is commensurate with that methodology, but the index takes steps to reduce some of the risks associated with high-dividend strategies.
“WTEMHY holds the highest (top 30%) dividend yielding companies in EM and screens out those with the highest risk according to our Composite Risk Screen measure,” says Alejandro Saltiel, WisdomTree associate director of research. “Selected companies are weighted by the dividends they’ve paid out over the past 12 months. In its most recent reconstitution, WTEMHY added weight to the Materials, Energy and Consumer Staples sectors as these have grown dividends proportionally faster in the last year and have shown strong fundamentals.”
As Saltiel notes, DEM tilts toward value sectors. It allocates over half its weight to financial services and materials stocks, far more than the MSCI Emerging Markets Index's combined weight to those groups. Overall, just 11.5% of the members of the MSCI Emerging Markets Index reside in DEM, and the overlap by weight between the WisdomTree ETF and the MSCI benchmark is just 9%, according to ETF Research Center data.
DEM's geographic exposures are also reflective of its status as a commodities-driven value play.
“In terms of country exposures, the rebalanced portfolio also favors commodity-driven economies such as Brazil and Russia and is resetting the exposure of Taiwan, which has had a significant run up since the last rebalance in October 2020,” adds Saltiel.
Those two countries combine for almost 24% of DEM's roster, well above the MSCI index's combined allocation. In line with historical precedent, Russian stocks are benefiting from higher oil prices this year, helping DEM in the process, as the MSCI Russia 25/50 Index is higher by 41%.
Some of DEM's commodities exposure is augmented by a 19% weight to Taiwan, a tech-heavy market with a track record of quality dividend growth. Overall, DEM has exposure to 18 developing economies.
For more news, information, and strategy, visit the Model Portfolio Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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DEM, which has nearly $2 billion in assets under management, tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. Some of DEM's commodities exposure is augmented by a 19% weight to Taiwan, a tech-heavy market with a track record of quality dividend growth. For example, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is higher by 9% year-to-date while the MSCI Emerging Markets Index is up a paltry 1.24%.
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For example, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is higher by 9% year-to-date while the MSCI Emerging Markets Index is up a paltry 1.24%. DEM, which has nearly $2 billion in assets under management, tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. In its most recent reconstitution, WTEMHY added weight to the Materials, Energy and Consumer Staples sectors as these have grown dividends proportionally faster in the last year and have shown strong fundamentals.” As Saltiel notes, DEM tilts toward value sectors.
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For example, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is higher by 9% year-to-date while the MSCI Emerging Markets Index is up a paltry 1.24%. DEM, which has nearly $2 billion in assets under management, tracks the WisdomTree’s Emerging Markets High Dividend Index (WTEMHY), a yield-weighted benchmark. Overall, just 11.5% of the members of the MSCI Emerging Markets Index reside in DEM, and the overlap by weight between the WisdomTree ETF and the MSCI benchmark is just 9%, according to ETF Research Center data.
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For example, the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM) is higher by 9% year-to-date while the MSCI Emerging Markets Index is up a paltry 1.24%. Some of DEM's commodities exposure is augmented by a 19% weight to Taiwan, a tech-heavy market with a track record of quality dividend growth. Overall, DEM has exposure to 18 developing economies.
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86349b64-550d-49eb-8bfb-c9cadd0377bd
|
727097.0
|
2021-09-24 00:00:00 UTC
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Emerging Markets Value Could Be Long-Term Winner
|
DEM
|
https://www.nasdaq.com/articles/emerging-markets-value-could-be-long-term-winner-2021-09-24
|
nan
|
nan
|
Domestic value stocks are garnering plenty of attention this year, and the returns for the asset class in the first half of the year were worthy of adulation.
While some of that momentum ebbed, value equities still have some catalysts, including precedent for performing well during inflationary climates, the possibility that Treasury yields will rise anew, and the fact that the current value rally is still young by historical standards.
Domestic value stocks may look attractive today, and some are, but investors shouldn't ignore international equivalents, including emerging markets fare. On that note, the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is an exchange traded fund to consider. In fact, inflation is a big reason to consider emerging markets value.
“So, value looks priced to give us about a 4% real return above inflation, still kind of anemic. Emerging markets are priced to give you about 5%, and emerging-markets value--value stocks within emerging markets, avoiding the highfliers in the emerging markets--are priced to give you about a 9.5% real return, well, add in inflation and that's probably a 12% return per annum for 10 years,” says Research Affiliates Chairman and founder Rob Arnott.
While Arnott is careful to note that it's not clear that this scenario will play out over the next 12 months, it is clear that EDOG is up over 10% year-to-date while the MSCI Emerging Markets Index is lower by 1.32%. Add to that, Arnott sees “extraordinary opportunities” in emerging markets value.Unlike traditional value ETFs, both foreign and domestic, EDOG isn't excessively weighted to one or two sectors because the fund's sector exposure are equally weighted. Currently, EDOG's sector allocations range from 9.21% to 10.52%.
Additionally, EDOG's geographic methodology is a perk at a time when Chinese stocks are roiling the broader emerging markets complex, perhaps distracting investors from solid performances in other regions. As just two examples, EDOG is overweighting Mexican and Russian equities relative to the MSCI Emerging Markets Index, and stocks in both of those countries are sharply higher this year.
EDOG delivers those benefits with a dividend yield of 2.96%, which is well in excess of the yields on both the MSCI Emerging Markets Index and the S&P 500 Value Index.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more on cornerstone strategies, visit our ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). While some of that momentum ebbed, value equities still have some catalysts, including precedent for performing well during inflationary climates, the possibility that Treasury yields will rise anew, and the fact that the current value rally is still young by historical standards. Additionally, EDOG's geographic methodology is a perk at a time when Chinese stocks are roiling the broader emerging markets complex, perhaps distracting investors from solid performances in other regions.
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Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Emerging markets are priced to give you about 5%, and emerging-markets value--value stocks within emerging markets, avoiding the highfliers in the emerging markets--are priced to give you about a 9.5% real return, well, add in inflation and that's probably a 12% return per annum for 10 years,” says Research Affiliates Chairman and founder Rob Arnott. Add to that, Arnott sees “extraordinary opportunities” in emerging markets value.Unlike traditional value ETFs, both foreign and domestic, EDOG isn't excessively weighted to one or two sectors because the fund's sector exposure are equally weighted.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). Emerging markets are priced to give you about 5%, and emerging-markets value--value stocks within emerging markets, avoiding the highfliers in the emerging markets--are priced to give you about a 9.5% real return, well, add in inflation and that's probably a 12% return per annum for 10 years,” says Research Affiliates Chairman and founder Rob Arnott. Add to that, Arnott sees “extraordinary opportunities” in emerging markets value.Unlike traditional value ETFs, both foreign and domestic, EDOG isn't excessively weighted to one or two sectors because the fund's sector exposure are equally weighted.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), the iShares Emerging Markets Dividend ETF (DVYE), and the WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). On that note, the ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is an exchange traded fund to consider. Add to that, Arnott sees “extraordinary opportunities” in emerging markets value.Unlike traditional value ETFs, both foreign and domestic, EDOG isn't excessively weighted to one or two sectors because the fund's sector exposure are equally weighted.
|
ced7e8a5-beaa-4d36-b0c4-bf79768c0033
|
727098.0
|
2021-08-18 00:00:00 UTC
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Seeing the Emerging Markets Forest Through China’s Trees
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DEM
|
https://www.nasdaq.com/articles/seeing-the-emerging-markets-forest-through-chinas-trees-2021-08-18
|
nan
|
nan
|
There's still a case for emerging markets equities, though that forest is hard to see through the trees of China's regulatory risk.
There's also still a case for emerging markets dividends. Investors can access those payouts while minimizing exposure to the vulnerable Chinese internet and technology stocks with the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM).
DEM's distribution yield of 5.70% clearly stands out, but that's far from the exchange traded fund's only favorable trait. Among DEM's eye-catching characteristics that are relevant today is the fund's 15% weight to China. That's less than half of the weight allocated to that country in the MSCI Emerging Markets Index. DEM also has some sector-level perks.
“WisdomTree’s high dividend Index has under-weight allocations to the companies—mostly in the Information Technology, Communication Services and Consumer Discretionary sectors—that have been the main targets of China’s regulatory crackdown,” notes WisdomTree analyst Matt Wagner.
DEM is also tethered to rebounding value stocks – a trend that spread to emerging markets this year.
DEM's underlying index “has also been over-weight in the value sectors like Financials and Materials that have been beneficiaries of an improving global economy and a rally in commodity prices,” adds Wagner.
Those two sectors combine for half the fund's roster. Aside from an almost 14% tech weight, the bulk of which doesn't involve China, most of DEM's sector exposures are either cyclical or defensive. Interestingly, while China is by far the largest developing economy and its internet and technology stocks have been stellar performers until recently, DEM has an established history of outpacing broader emerging markets benchmarks.
The WisdomTree Emerging Markets High Dividend Index, DEM's underlying benchmark, has topped the MSCI Emerging Markets Index dating back to 2007. In other words, investors are getting paid to prune China exposure and embrace dividends.
“The outperformance was achieved with less risk over the full period, albeit with similar volatility to the benchmark in more recent years,” according to Wagner. “We think this approach to targeting quality dividend payers can provide a solution for investors interested in enhancing potential income for portfolios, as an active management solution, and/or to tap into a higher inflation thesis, given its tilts to the Materials, Financials and Real Estate sectors.”
For more news, information, and strategy, visit the Dividend Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Investors can access those payouts while minimizing exposure to the vulnerable Chinese internet and technology stocks with the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). DEM's underlying index “has also been over-weight in the value sectors like Financials and Materials that have been beneficiaries of an improving global economy and a rally in commodity prices,” adds Wagner. Interestingly, while China is by far the largest developing economy and its internet and technology stocks have been stellar performers until recently, DEM has an established history of outpacing broader emerging markets benchmarks.
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Investors can access those payouts while minimizing exposure to the vulnerable Chinese internet and technology stocks with the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). The WisdomTree Emerging Markets High Dividend Index, DEM's underlying benchmark, has topped the MSCI Emerging Markets Index dating back to 2007. DEM's distribution yield of 5.70% clearly stands out, but that's far from the exchange traded fund's only favorable trait.
|
Investors can access those payouts while minimizing exposure to the vulnerable Chinese internet and technology stocks with the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). Interestingly, while China is by far the largest developing economy and its internet and technology stocks have been stellar performers until recently, DEM has an established history of outpacing broader emerging markets benchmarks. The WisdomTree Emerging Markets High Dividend Index, DEM's underlying benchmark, has topped the MSCI Emerging Markets Index dating back to 2007.
|
Investors can access those payouts while minimizing exposure to the vulnerable Chinese internet and technology stocks with the WisdomTree Emerging Markets High Dividend Fund (NYSEArca: DEM). The WisdomTree Emerging Markets High Dividend Index, DEM's underlying benchmark, has topped the MSCI Emerging Markets Index dating back to 2007. DEM's distribution yield of 5.70% clearly stands out, but that's far from the exchange traded fund's only favorable trait.
|
13cac708-9c65-45b7-b566-4d74663fbe93
|
727099.0
|
2021-08-16 00:00:00 UTC
|
Seeking to Dial Back Your Exposure to China?
|
DEM
|
https://www.nasdaq.com/articles/seeking-to-dial-back-your-exposure-to-china-2021-08-16
|
nan
|
nan
|
Income investors that embrace international stocks are facing a conundrum when it comes to emerging markets.
Developing economies often sport higher dividend yields than broader U.S. equity benchmarks and China is the biggest emerging markets dividend payer in dollar terms. Yet as investors well know, China is now a financial minefield owing to Beijing's regulatory efforts against internet and technology companies.
The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is one way investors can access emerging markets payouts while dialing back China exposure. EDOG could prove to be an ideal near- to medium-term idea for investors seeking emerging markets exposure.
“While we are bearish on Chinese equities for US investors, we are bullish on EM broadly and on India in particular. For the long term, these economies benefit from favorable demographics, modernization potential, and generally attractive valuations,” said Bank of America analysts in a recent note.
China is EDOG's third-largest country weight and while that may sound problematic in the current environment, the world's second-largest economy accounts for just 9.73% of EDOG's geographic exposure, as compared to 34.74% in the MSCI Emerging Markets Index.
With a 30-day SEC yield of 3.87%, EDOG is sure to appeal to some income-starved investors. However, the ETF's geographic structure may be even more appealing than that yield.
“Emerging markets ex-China (EMxC) will contribute nearly a third of 2022 global GDP growth ($21.2tn of $93.8tn, per the IMF). Yet their allocation is very small in most portfolios, representing just 12% of global equity market capitalization. We expect this allocation to rise in coming years,” according to Bank of America.
In other words, there are still good reasons to be engaged with developing economies today. Not surprisingly given its cyclical lean, there's also a valuation case for EDOG.
“A crucial shift to monitor is what happens to the premium investors are willing to pay for access to riskier Chinese corporate profits. EMxC and China trade today at about 15x earnings. Stocks in countries like Turkey and Russia trade around 5-7x,” adds Bank of America.
Russia is EDOG's largest country weight at 10.42% while Turkey checks in at 2%.
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), iShares Emerging Markets Dividend ETF (DVYE), and WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM).
For more on cornerstone strategies, visit our ETF Building Blocks Channel.
Read more on ETFtrends.com.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
|
For the long term, these economies benefit from favorable demographics, modernization potential, and generally attractive valuations,” said Bank of America analysts in a recent note. Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), iShares Emerging Markets Dividend ETF (DVYE), and WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). EDOG could prove to be an ideal near- to medium-term idea for investors seeking emerging markets exposure.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), iShares Emerging Markets Dividend ETF (DVYE), and WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). For the long term, these economies benefit from favorable demographics, modernization potential, and generally attractive valuations,” said Bank of America analysts in a recent note. Developing economies often sport higher dividend yields than broader U.S. equity benchmarks and China is the biggest emerging markets dividend payer in dollar terms.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), iShares Emerging Markets Dividend ETF (DVYE), and WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). For the long term, these economies benefit from favorable demographics, modernization potential, and generally attractive valuations,” said Bank of America analysts in a recent note. The ALPS Emerging Sector Dogs ETF (NYSEArca: EDOG) is one way investors can access emerging markets payouts while dialing back China exposure.
|
Other emerging markets dividend ETFs include the ProShares MSCI Emerging Markets Dividend Growers ETF (CBOE: EMDV), iShares Emerging Markets Dividend ETF (DVYE), and WisdomTree Emerging Markets Equity Income Fund (NYSEArca: DEM). For the long term, these economies benefit from favorable demographics, modernization potential, and generally attractive valuations,” said Bank of America analysts in a recent note. China is EDOG's third-largest country weight and while that may sound problematic in the current environment, the world's second-largest economy accounts for just 9.73% of EDOG's geographic exposure, as compared to 34.74% in the MSCI Emerging Markets Index.
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b998e214-b689-4822-8c4e-24707556798c
|
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