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Here is What Hedge Funds Think About T. Rowe Price Group, Inc. (TROW)
There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Jeff Ubben, George Soros and Carl Icahn think. Those hedge fund operators make billions of dollars each year by hiring the best and the brightest to do research on stocks, including small cap stocks that big brokerage houses simply don't cover. Because of Carl Icahn and other elite funds' exemplary historical records, we pay attention to their small cap picks. In this article, we use hedge fund filing data to analyze T. Rowe Price Group, Inc. (NASDAQ:TROW).
T. Rowe Price Group, Inc. (NASDAQ:TROW)has seen an increase in hedge fund interest of late. Our calculations also showed that TROW isn't among the30 most popular stocks among hedge funds.
To most traders, hedge funds are viewed as underperforming, old financial tools of years past. While there are more than 8000 funds trading at the moment, Our researchers choose to focus on the bigwigs of this club, about 750 funds. It is estimated that this group of investors preside over most of the hedge fund industry's total capital, and by observing their top stock picks, Insider Monkey has discovered several investment strategies that have historically surpassed the broader indices. Insider Monkey's flagship hedge fund strategy beat the S&P 500 index by around 5 percentage points per year since its inception in May 2014 through the end of May. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 30.9% since February 2017 (through May 30th) even though the market was up nearly 24% during the same period. We just shared a list of 5 short targets in ourlatest quarterly updateand they are already down an average of 11.9% in less than a couple of weeks whereas our long picks outperformed the market by 2 percentage points in this volatile 2 week period.
We're going to review the latest hedge fund action encompassing T. Rowe Price Group, Inc. (NASDAQ:TROW).
Heading into the second quarter of 2019, a total of 26 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 18% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in TROW over the last 15 quarters. With hedgies' sentiment swirling, there exists a few key hedge fund managers who were increasing their stakes considerably (or already accumulated large positions).
Among these funds,Millennium Managementheld the most valuable stake in T. Rowe Price Group, Inc. (NASDAQ:TROW), which was worth $167.7 million at the end of the first quarter. On the second spot was Renaissance Technologies which amassed $122.3 million worth of shares. Moreover, Citadel Investment Group, AQR Capital Management, and Markel Gayner Asset Management were also bullish on T. Rowe Price Group, Inc. (NASDAQ:TROW), allocating a large percentage of their portfolios to this stock.
As aggregate interest increased, specific money managers have been driving this bullishness.Junto Capital Management, managed by James Parsons, created the biggest position in T. Rowe Price Group, Inc. (NASDAQ:TROW). Junto Capital Management had $18.5 million invested in the company at the end of the quarter. Dmitry Balyasny'sBalyasny Asset Managementalso made a $3.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Paul Marshall and Ian Wace'sMarshall Wace LLP, Jeffrey Talpins'sElement Capital Management, and Brandon Haley'sHolocene Advisors.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as T. Rowe Price Group, Inc. (NASDAQ:TROW) but similarly valued. These stocks are PACCAR Inc (NASDAQ:PCAR), Waste Connections, Inc. (NYSE:WCN), Discover Financial Services (NYSE:DFS), and Fiat Chrysler Automobiles NV (NYSE:FCAU). This group of stocks' market valuations are similar to TROW's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PCAR,23,94730,4 WCN,26,545837,-2 DFS,36,742031,-1 FCAU,27,2246774,-7 Average,28,907343,-1.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 28 hedge funds with bullish positions and the average amount invested in these stocks was $907 million. That figure was $520 million in TROW's case. Discover Financial Services (NYSE:DFS) is the most popular stock in this table. On the other hand PACCAR Inc (NASDAQ:PCAR) is the least popular one with only 23 bullish hedge fund positions. T. Rowe Price Group, Inc. (NASDAQ:TROW) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on TROW as the stock returned 2.5% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published atInsider Monkey.
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Is Bruker Corporation (BRKR) A Good Stock To Buy?
Is Bruker Corporation (NASDAQ:BRKR) a good investment right now? We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.
Bruker Corporation (NASDAQ:BRKR)was in 25 hedge funds' portfolios at the end of the first quarter of 2019. BRKR investors should be aware of a decrease in hedge fund interest recently. There were 26 hedge funds in our database with BRKR positions at the end of the previous quarter. Our calculations also showed that brkr isn't among the30 most popular stocks among hedge funds.
If you'd ask most market participants, hedge funds are seen as unimportant, old financial vehicles of the past. While there are over 8000 funds in operation at the moment, Our experts hone in on the moguls of this club, approximately 750 funds. These investment experts orchestrate the lion's share of all hedge funds' total capital, and by tailing their unrivaled equity investments, Insider Monkey has identified many investment strategies that have historically outrun the market. Insider Monkey's flagship hedge fund strategy outpaced the S&P 500 index by around 5 percentage points a year since its inception in May 2014 through the end of May. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 30.9% since February 2017 (through May 30th) even though the market was up nearly 24% during the same period. We just shared a list of 5 short targets in ourlatest quarterly updateand they are already down an average of 11.9% in less than a couple of weeks whereas our long picks outperformed the market by 2 percentage points in this volatile 2 week period.
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Paul Marshall of Marshall Wace[/caption]
Let's go over the recent hedge fund action encompassing Bruker Corporation (NASDAQ:BRKR).
At the end of the first quarter, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -4% from one quarter earlier. By comparison, 21 hedge funds held shares or bullish call options in BRKR a year ago. With hedgies' positions undergoing their usual ebb and flow, there exists a few noteworthy hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey,D E Shaw, managed by D. E. Shaw, holds the biggest position in Bruker Corporation (NASDAQ:BRKR). D E Shaw has a $73.1 million position in the stock, comprising 0.1% of its 13F portfolio. On D E Shaw's heels isAQR Capital Management, led by Cliff Asness, holding a $65.4 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedge funds and institutional investors that hold long positions encompass Ken Griffin'sCitadel Investment Group, Peter Rathjens, Bruce Clarke and John Campbell'sArrowstreet Capitaland Paul Marshall and Ian Wace'sMarshall Wace LLP.
Seeing as Bruker Corporation (NASDAQ:BRKR) has faced declining sentiment from the entirety of the hedge funds we track, logic holds that there is a sect of money managers who sold off their full holdings last quarter. Intriguingly, Simon Sadler'sSegantii Capitalsold off the largest stake of the 700 funds tracked by Insider Monkey, valued at an estimated $7 million in stock. Benjamin A. Smith's fund,Laurion Capital Management, also dropped its stock, about $1.3 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest was cut by 1 funds last quarter.
Let's now review hedge fund activity in other stocks similar to Bruker Corporation (NASDAQ:BRKR). We will take a look at Texas Pacific Land Trust (NYSE:TPL), CubeSmart (NYSE:CUBE), Royal Gold, Inc (NASDAQ:RGLD), and Axalta Coating Systems Ltd (NYSE:AXTA). This group of stocks' market values are similar to BRKR's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TPL,11,1470997,-2 CUBE,20,393248,-2 RGLD,17,67145,2 AXTA,43,1962919,8 Average,22.75,973577,1.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 22.75 hedge funds with bullish positions and the average amount invested in these stocks was $974 million. That figure was $400 million in BRKR's case. Axalta Coating Systems Ltd (NYSE:AXTA) is the most popular stock in this table. On the other hand Texas Pacific Land Trust (NYSE:TPL) is the least popular one with only 11 bullish hedge fund positions. Bruker Corporation (NASDAQ:BRKR) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on BRKR as the stock returned 7.9% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Western Union and Zelle Executives Dish on Competition and the Future of Mobile Payments
“Money is like manure; it’s not worth a thing unless it’s spread around encouraging young things to grow,” wrote playwright Thornton Wilder, channeling 16th century British philosopher and statesman Francis Bacon. The old quote describes the digital movement of money—a hot area in tech stoked even brighter by Facebook’s announcement earlier this week about its Libra cryptocurrency project.
And Libra was the subject of the first question thatFortunesenior writer Robert Hackett asked during a session atFortune’sinaugural Brainstorm Finance conference in Montauk, N.Y., on Wednesday. Providing the answers were Hikmet Ersek, president and CEO of TheWestern UnionCompany, and Lou Anne Alexander, group president of payment solutions at Early Warning Services, a firm co-owned by several big banks including Bank of America, JPMorgan Chase[/f500link], andWells Fargothat operates the two-year old Zelle payment app.
Hackett asked about the potential competition thatFacebookmight offer, especially as there might be “nearly zero” costs for transmitting payments through the Libra system.
Ersek noted that the new Libra venture has considerable work ahead having developing a full payment and money transmission system, especially when considering so-called unbanked people who may need to pay and receive actual cash, not just a transaction on a mobile phone. “The real cost is serving the customer in the last mile,” he said, referring to accepting and delivering money in local currencies, whether electronically or in person. “You have to be in the streets of Cairo, the streets of Nairobi. It took us many, many years to build a global system that moves $300 billion every year.”
For Western Union, that requires a broad network of local offices. Customers must trust that $500 sent from Chicago to Jamaica will arrive in minutes, working with more than 130 currencies, and fraud-detection. “Libra is more of a payment system, not the last mile,” Ersek said. “How do you take that currency, translate that into a fiat currency? How do you do that?”
Hackett also asked Alexander about competition, given that Zelle is young and competes against better-established rivals like PayPal’s Venmo,ApplePay, and Square Cash.
“I would say look at our numbers,” Alexander said, quoting figures like $39 billion transferred in 147 million transactions in the first quarter. She went on to praise her 30-year old company’s close relationship with established banks. “Most of the customers actually tried Zelle for the very first time because it’s offered by their financial institutions,” she said.
Zelle currently is marketing to Gen Xers and Baby Boomers who make up half of their new customers. That requires educating them about using the app.
Zelle’s owner is also looking for new sources of revenue. That includes helping insurance companies pay out home and car damage claims to customers. “Where I believe some of the biggest business will come is small business,” Alexander said.
Hammering home the idea that Western Union is nimble, Ersek said that the company is willing to cannibalize its own business by introducing new products. Although the economics cryptocurrencies don’t currently provide transaction costs that are low enough to make them feasible for the company, for example, it does have employees who are following the technology to see if, and when, it may create cost advantages.
—Brainstorm Finance 2019: Watch the livestreamof the inaugural conference
—Bank of America CEO: “We want acashless society”
—Tala CEO: HowFacebook’s Libra cryptocurrencycan help companies scale
—Charles Schwab CEO: Actually, we’rekilling it with millennials
—Listen to our new audio briefing,Fortune500 Daily
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Hedge Funds Have Never Been This Bullish On Hexcel Corporation (HXL)
Concerns over rising interest rates and expected further rate increases have hit several stocks hard during the fourth quarter. Trends reversed 180 degrees during the first quarter amid Powell's pivot and optimistic expectations towards a trade deal with China. Hedge funds and institutional investors tracked by Insider Monkey usually invest a disproportionate amount of their portfolios in smaller cap stocks. We have been receiving indications that hedge funds were increasing their overall exposure in the first quarter and this is one of the factors behind the recent movements in major indices. In this article, we will take a closer look at hedge fund sentiment towards Hexcel Corporation (NYSE:HXL).
IsHexcel Corporation (NYSE:HXL)a buy here? Investors who are in the know are becoming more confident. The number of bullish hedge fund positions rose by 2 in recent months. Our calculations also showed that hxl isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let's take a look at the recent hedge fund action encompassing Hexcel Corporation (NYSE:HXL).
At the end of the first quarter, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 9% from one quarter earlier. On the other hand, there were a total of 19 hedge funds with a bullish position in HXL a year ago. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically,Millennium Managementwas the largest shareholder of Hexcel Corporation (NYSE:HXL), with a stake worth $37.2 million reported as of the end of March. Trailing Millennium Management was Joho Capital, which amassed a stake valued at $29.3 million. D E Shaw, Marshall Wace LLP, and Markel Gayner Asset Management were also very fond of the stock, giving the stock large weights in their portfolios.
With a general bullishness amongst the heavyweights, key hedge funds were leading the bulls' herd.Renaissance Technologies, managed by Jim Simons, created the largest position in Hexcel Corporation (NYSE:HXL). Renaissance Technologies had $9.3 million invested in the company at the end of the quarter. Peter Muller'sPDT Partnersalso made a $4 million investment in the stock during the quarter. The following funds were also among the new HXL investors: Cliff Asness'sAQR Capital Management, Matthew Tewksbury'sStevens Capital Management, and Michael Platt and William Reeves'sBlueCrest Capital Mgmt..
Let's go over hedge fund activity in other stocks similar to Hexcel Corporation (NYSE:HXL). These stocks are XPO Logistics Inc (NYSE:XPO), National Instruments Corporation (NASDAQ:NATI), Healthcare Trust Of America Inc (NYSE:HTA), and Assurant, Inc. (NYSE:AIZ). All of these stocks' market caps match HXL's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position XPO,26,2005525,-18 NATI,28,604817,-1 HTA,19,458711,2 AIZ,39,617750,8 Average,28,921701,-2.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 28 hedge funds with bullish positions and the average amount invested in these stocks was $922 million. That figure was $176 million in HXL's case. Assurant, Inc. (NYSE:AIZ) is the most popular stock in this table. On the other hand Healthcare Trust Of America Inc (NYSE:HTA) is the least popular one with only 19 bullish hedge fund positions. Hexcel Corporation (NYSE:HXL) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on HXL as the stock returned 6% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published atInsider Monkey.
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Hedge Funds Have Never Been This Bullish On CareDx, Inc. (CDNA)
At Insider Monkey, we pore over the filings of nearly 750 top investment firms every quarter, a process we have now completed for the latest reporting period. The data we've gathered as a result gives us access to a wealth of collective knowledge based on these firms' portfolio holdings as of March 31. In this article, we will use that wealth of knowledge to determine whether or not CareDx, Inc. (NASDAQ:CDNA) makes for a good investment right now.
CareDx, Inc. (NASDAQ:CDNA)has experienced an increase in activity from the world's largest hedge funds recently.CDNAwas in 25 hedge funds' portfolios at the end of March. There were 22 hedge funds in our database with CDNA positions at the end of the previous quarter. Our calculations also showed that CDNA isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let's review the key hedge fund action encompassing CareDx, Inc. (NASDAQ:CDNA).
At the end of the first quarter, a total of 25 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 14% from the fourth quarter of 2018. On the other hand, there were a total of 14 hedge funds with a bullish position in CDNA a year ago. With hedgies' capital changing hands, there exists a few notable hedge fund managers who were boosting their holdings significantly (or already accumulated large positions).
Among these funds,OrbiMed Advisorsheld the most valuable stake in CareDx, Inc. (NASDAQ:CDNA), which was worth $26.1 million at the end of the first quarter. On the second spot was Driehaus Capital which amassed $24.1 million worth of shares. Moreover, Two Sigma Advisors, AQR Capital Management, and Iszo Capital were also bullish on CareDx, Inc. (NASDAQ:CDNA), allocating a large percentage of their portfolios to this stock.
Now, key hedge funds have jumped into CareDx, Inc. (NASDAQ:CDNA) headfirst.OrbiMed Advisors, managed by Samuel Isaly, assembled the biggest position in CareDx, Inc. (NASDAQ:CDNA). OrbiMed Advisors had $26.1 million invested in the company at the end of the quarter. Ken Griffin'sCitadel Investment Groupalso made a $2.1 million investment in the stock during the quarter. The following funds were also among the new CDNA investors: Minhua Zhang'sWeld Capital Management, David Costen Haley'sHBK Investments, and Dmitry Balyasny'sBalyasny Asset Management.
Let's now take a look at hedge fund activity in other stocks similar to CareDx, Inc. (NASDAQ:CDNA). We will take a look at TPG Specialty Lending Inc (NYSE:TSLX), Industrial Logistics Properties Trust (NASDAQ:ILPT), Clovis Oncology Inc (NASDAQ:CLVS), and Fresh Del Monte Produce Inc (NYSE:FDP). This group of stocks' market valuations are closest to CDNA's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TSLX,12,75598,2 ILPT,16,181029,-3 CLVS,29,567447,5 FDP,14,43087,-1 Average,17.75,216790,0.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 17.75 hedge funds with bullish positions and the average amount invested in these stocks was $217 million. That figure was $140 million in CDNA's case. Clovis Oncology Inc (NASDAQ:CLVS) is the most popular stock in this table. On the other hand TPG Specialty Lending Inc (NYSE:TSLX) is the least popular one with only 12 bullish hedge fund positions. CareDx, Inc. (NASDAQ:CDNA) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on CDNA as the stock returned 2.2% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Here is What Hedge Funds Think About Pivotal Software, Inc. (PVTL)
Hedge funds are known to underperform the bull markets but that's not because they are terrible at stock picking. Hedge funds underperform because their net exposure in only 40-70% and they charge exorbitant fees. No one knows what the future holds and how market participants will react to the bountiful news that floods in each day. However, hedge funds' consensus picks on average deliver market beating returns. For example in the first 5 months of this year through May 30th the Standard and Poor’s 500 Index returned approximately 12.1% (including dividend payments). Conversely, hedge funds’ top 20 large-cap stock picks generated a return of 18.7% during the same 5-month period, with the majority of these stock picks outperforming the broader market benchmark. Interestingly, an average long/short hedge fund returned only a fraction of this value due to the hedges they implemented and the large fees they charged. If you pay attention to the actual hedge fund returns versus the returns of their long stock picks, you might believe that it is a waste of time to analyze hedge funds' purchases. We know better. That's why we scrutinize hedge fund sentiment before we invest in a stock like Pivotal Software, Inc. (NYSE:PVTL).
Pivotal Software, Inc. (NYSE:PVTL)has experienced a decrease in hedge fund interest of late. Our calculations also showed that pvtl isn't among the30 most popular stocks among hedge funds.
In the 21st century investor’s toolkit there are a lot of signals investors put to use to appraise their holdings. Some of the less known signals are hedge fund and insider trading signals. Our researchers have shown that, historically, those who follow the top picks of the elite investment managers can beat the market by a healthy amount (see the details here).
Let's go over the recent hedge fund action surrounding Pivotal Software, Inc. (NYSE:PVTL).
At the end of the first quarter, a total of 25 of the hedge funds tracked by Insider Monkey were long this stock, a change of -22% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in PVTL over the last 15 quarters. So, let's examine which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Pivotal Software, Inc. (NYSE:PVTL) was held bySteadfast Capital Management, which reported holding $97.1 million worth of stock at the end of March. It was followed by SQN Investors with a $70.7 million position. Other investors bullish on the company included Citadel Investment Group, Alkeon Capital Management, and Highline Capital Management.
Because Pivotal Software, Inc. (NYSE:PVTL) has experienced declining sentiment from the smart money, it's safe to say that there is a sect of hedge funds that elected to cut their full holdings last quarter. Intriguingly, Jeffrey Talpins'sElement Capital Managementdumped the biggest position of the "upper crust" of funds watched by Insider Monkey, comprising an estimated $29.5 million in stock, and Benjamin A. Smith's Laurion Capital Management was right behind this move, as the fund dropped about $23.7 million worth. These bearish behaviors are interesting, as aggregate hedge fund interest dropped by 7 funds last quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Pivotal Software, Inc. (NYSE:PVTL) but similarly valued. We will take a look at Synovus Financial Corp. (NYSE:SNV), Ternium S.A. (NYSE:TX), Compania Cervecerias Unidas S.A. (NYSE:CCU), and Cypress Semiconductor Corporation (NASDAQ:CY). This group of stocks' market valuations match PVTL's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SNV,41,828060,9 TX,12,81294,0 CCU,11,83289,2 CY,25,224543,2 Average,22.25,304297,3.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 22.25 hedge funds with bullish positions and the average amount invested in these stocks was $304 million. That figure was $472 million in PVTL's case. Synovus Financial Corp. (NYSE:SNV) is the most popular stock in this table. On the other hand Compania Cervecerias Unidas S.A. (NYSE:CCU) is the least popular one with only 11 bullish hedge fund positions. Pivotal Software, Inc. (NYSE:PVTL) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on PVTL as the stock returned 2.8% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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How to Stay Hydrated
Consumer Reports has no financial relationship with advertisers on this site. During summer’s heat, it’s easy to become dehydrated without realizing it. And dehydration, which occurs when you lose more water via sweat and urine than you’ve taken in, can be especially dangerous for older adults. “How much water you have affects every body system,” says Jodi Stookey, Ph.D., an epidemiologist in San Francisco. A lack of sufficient fluid in the body can temporarily cause confusion and put you at risk for falls . When severe, dehydration can lead to a rapid or irregular heart rate, low blood pressure, fainting, and even death. And dehydration—along with certain chronic illnesses, medications you may be taking, and lack of access to air conditioning —can raise your risk of heatstroke, a condition in which your body becomes very overheated and loses its ability to regulate its temperature. According to an analysis out this week in the New England Journal of Medicine, heatstroke in older adults may be fatal in more than half of cases. Staying well-hydrated becomes more difficult with age because your sense of thirst tends to diminish with time. Diuretics, often prescribed for high blood pressure and heart failure, can exaggerate water loss. But you can protect yourself. Here’s how to stay hydrated during the warm months and year-round. 4 Steps for Staying Hydrated Despite the widespread myth that everyone should consume eight 8-ounce glasses of water each day, there’s really no overarching rule about how much you need to drink to stay hydrated. What’s appropriate can vary a good bit from person to person. Generally speaking, the heavier, taller, and more active you are (and the hotter and more humid the weather is), the more fluids you need to take in to cover your losses. To make sure you get enough: Drink before you feel parched. To make up for that reduced sense of thirst, sip preemptively. By the time you actually feel thirsty, you might be mildly dehydrated. Sip small amounts throughout the day. If you find it difficult to consume a full glass of water all at once, drink a bit at a time—but do this frequently. Carrying a water bottle with you at all times can help remind you to drink. Know that other beverages and foods count, too. In fact, all beverages (other than alcoholic drinks) will hydrate you. That includes caffeinated drinks, even though coffee and tea are mild diuretics and can cause you to urinate more often. But these drinks will add more to your liquid stores than you’ll lose from extra urination, says Janet Mentes, Ph.D., a professor at the UCLA School of Nursing. Story continues Soup, fruits, and vegetables are also good sources of liquid. Consider your health. Ask your doctor whether medical conditions you have or medications you take affect your hydration needs. And keep in mind that some health conditions, such as kidney disease and congestive heart failure , may make it dangerous to take in too much fluid. In these cases, your doctor can show you how to stay hydrated safely. Know the Signs Dehydration can be challenging to detect as we age because classic signs, such as dry mouth, thirst, fatigue, and skin that fails to spring back quickly when pinched, can also be caused by other factors. In fact, a 2015 review of research by the independent Cochrane Collaboration found that there was no single reliable test for dehydration. The color of your urine can sometimes be a clue. In general, healthy urine is the shade of pale straw. The darker your urine, the less hydrated you may be. But aspirin, multivitamins, and certain fruits and vegetables can also affect the shade of your urine. If you suspect you might be dehydrated based on your urine’s color and/or the other signs mentioned, try drinking two to three full glasses of water during the course of an hour or two. If you still have symptoms of dehydration or don’t urinate within 4 hours, it’s wise to contact your doctor. You should also know the signs of heatstroke , which is a medical emergency. In older adults, according to the NEJM review, early symptoms of heatstroke include confusion, dizziness, weakness, agitation, and other behavioral changes, as well as slurred speech, nausea, and vomiting. If you suspect it in yourself or someone else, call 911 right away. Then begin trying to cool down the person. Fan the person or get him into air conditioning and apply ice or cold packs. To prevent heatstroke to begin with, try to keep your body at a normal temperature. Muscle cramps (sometimes called heat cramps) and heat exhaustion, which involves symptoms such as tiredness, weakness, dizziness, heavy sweating, and headache, are signs that you should stop any strenuous activity, cool down, and sip some water. Stay in air-conditioned spaces, take frequent cool showers or baths, and limit physical activity during heat waves or the hottest parts of the day. 3 Surprising Causes Taking in too little liquid is an important factor in dehydration, but the following play a role as well: Infections that cause diarrhea , vomiting, excessive sweating, and fever. Tara Cortes, Ph.D., executive director of the Hartford Institute for Geriatric Nursing at New York University, suggests calling a doctor if you vomit repeatedly or have a fever of more than 101° F for more than a day or diarrhea for more than two days. Medication that causes the kidneys to produce more urine, such as diuretics. Some over-the-counter drugs, such as laxatives, may also cause water loss. Health conditions, such as poorly controlled diabetes , that lead to excessive water loss. A 2016 study in the Annals of Family Medicine found that obese people were more likely to be inadequately hydrated as well. Having dementia , Parkinson’s disease, or a stroke can also increase the chance of dehydration. Editor's Note: A version of this article also appeared in the June 2017 issue of Consumer Reports on Health . Consumer Reports has no financial relationship with advertisers on this site. More from Consumer Reports: Top pick tires for 2016 Best used cars for $25,000 and less 7 best mattresses for couples Consumer Reports is an independent, nonprofit organization that works side by side with consumers to create a fairer, safer, and healthier world. CR does not endorse products or services, and does not accept advertising. Copyright © 2019, Consumer Reports, Inc. View comments |
Union Pacific CEO signals caution on Trump's China tariff threat
By Anna Driver and Lisa Baertlein
NEW YORK/LOS ANGELES, June 19 (Reuters) - Union Pacific Corp's chief executive said another round of tariffs on Chinese goods could badly hurt his railroad and the U.S. economy, but he feels U.S. President Donald Trump is listening to his concerns.
CEO Lance Fritz listed trade as one of the reasons the company has taken a more negative tone in its growth outlook. The trade wars, along with slowing industrials and devastating floods in the U.S. Midwest, have weighed on the railroad's prospects in recent months.
He said there is no doubt that the threat of 25% tariffs on an additional $300 billion in Chinese imports caused him significant concern. He met Trump on Friday.
"I was heard, understood and that's better access than we've had in a long time," Fritz said.
The Omaha, Nebraska-based company's rail network covers 32,000 route miles (51,000 km) in the Western two-thirds of the country and includes the Los Angeles/Long Beach port complex, which handles the most China ocean cargo in the United States.
"It's hard to say how quickly (the threatened tariffs) would show up in my top line, but that would be a pretty significant risk to us," Fritz said at a meeting with Reuters editors and reporters on Wednesday.
Fritz's comments underscore the risk that Trump's trade war with China poses for the U.S. economy. After talks stalled, Trump and Chinese President Xi Jinping are due to sit down at the G20 Summit in Osaka, Japan later this month.
Union Pacific expects 2019 volume growth in the low single-digit percentages. Volume fell 2% in the first quarter and 4% in the second quarter. Floods in the Midwest hampered Union Pacific's business in the first half of the year, along with concerns about the trade spat with China.
Fritz would not say how much of Union Pacific's business originates and terminates in China, but said Asia accounts for an important portion of its revenue.
U.S. exports to China tumbled 30% in the first quarter, while U.S. imports from China fell 9%, according to International Monetary Fund trade data analyzed by trade credit insurance firm Atradius.
That has hit close to home for Union Pacific, which said in April that agricultural shipments from its home state and around the Midwest tumbled since China slapped retaliatory tariffs on U.S. soybeans. The railroad's agriculture products revenue fell 3% to almost $1.1 billion in the first quarter, hurt by a 7% drop in grain carloads due to reduced exports to China.
The pressure increased on June 1, when Washington hiked tariffs on $200 billion of Chinese goods to 25% from 10% and Beijing retaliated by boosting tariffs on $60 billion in U.S. goods to 25% from 5%.
The trans-Pacific standoff comes as the railroad, one of the nation's largest, has been grappling with a softening in the truck market that makes highway shipments more competitive with rail. (Reporting by Lisa Baertlein in Los Angeles and Anna Driver in New York Editing by Bill Rigby) |
YouTube Faces Its Next Big Reckoning: How to Handle Children's Privacy
YouTube is mulling over changes to how it handles content targeted at children amid a reported investigation by the Federal Trade Commission over allegations it violated the privacy of kids.
At issue is whether YouTube violated the Children’s Online Privacy Protection Act, according to theWashington Post. COPPA makes it illegal for companies to collect information about children under the age of 13, unless they receive parental consent.
YouTube and the FTC declined to comment.
YouTube has long been playing with fire when it comes to COPPA compliance, according to privacy experts. Last year, more than 20 groups sent a letter to the FTC asking regulators to look into whether YouTube was collecting information about the habits of children without parental consent.
“Device sharing in families is part of the problem,” says Dona Fraser, vice president of the Children’s Advertising Review Unit, an independent, self-regulatory agency of the Council of Better Business Bureaus that monitors ads geared toward children. Many parents will allow their kids to use family devices, which are often registered to an adult, to watch videos.
Parents are generally unaware of the nuances of ad tracking, and the data that is collected when they hand over devices to their kids, she says. Fraser says a simple “on” and “off” switch could help YouTube get around this issue.
YouTube seems to have other ideas. One possible solution to ensure COPPA compliance involves moving all children’s content to the standalone YouTube Kids app, according to aWall Street Journalreport.
“My issue is that the statistics seem to indicate that parents aren’t even aware of or use the YouTube Kids app,” Fraser says. “If a parent knows their kid can watch the videos they want on YouTube, what is the motivation to switch over?”
YouTube has also reportedly discussed turning off autoplay on kids’ videos, which would ensure that kids aren’t led down a black hole of endless videos and perhaps, to more mature content and ads.
There’s a reason why YouTube’s algorithm wants to offer people more content to watch: The more people are sucked into watching more videos, the more revenue YouTube collects from advertisers. Thechildren’s market is an important part of YouTube’s revenue.While the company doesn’t disclose sales, Loup Ventures estimates that 5% of YouTube’s revenue comes from content tailored to kids.
“I am not convinced any of this gets YouTube to where they need to be, but it also creates challenges for advertisers,” says Fraser. “Advertisers are constantly trying to figure out how to navigate YouTube so they don’t run afoul of COPPA.” Fraser favors a “mixed audience” approach, in which YouTube shuts down its kids app, and instead places various content behind age-restricted areas. Children will be able to find the videos they want, while YouTube will have a “clean solution” for making sure they’re not collecting information about kids under the age of 13. “Kids don’t have to lie about their age, because they are still getting access to YouTube,” she says. “They don’t know what they’re getting blocked from.” The challenge over how to handle children’s content is just one of several major threats to YouTube’s business model that it is being forced to confront. After a journalist reported repeated homophobic harassment on the site, YouTube declined to remove the videos he flagged. As the company faced pressure this month, which also happens to be gay pride month, YouTube announced it would ban all hate speech. YouTube was one of several social media giants that was hit with criticism in March forfailing to quickly remove videos showing the Christchurch massacre. Its recommendation engine, which serves up an endless playlist of videos on auto play, has also been under scrutiny for leading people to videos touting alt-right content and conspiracy theories. “YouTube is always going to have obstacles and criticisms,” Fraser says. “They can’t please everyone, but there is a majority they can please.”
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Have Insiders Been Buying Adavale Resources Limited (ASX:ADD) Shares?
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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares inAdavale Resources Limited(ASX:ADD).
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
View our latest analysis for Adavale Resources
Over the last year, we can see that the biggest insider purchase was by Non-Executive Director Huili Guo for AU$134k worth of shares, at about AU$0.0084 per share. That implies that an insider found the current price of AU$0.01 per share to be enticing. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. In this case we're pleased to report that the insider bought shares at close to current prices. Huili Guo was the only individual insider to buy over the year.
The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably donotwant to miss thisfreelist of growing companies that insiders are buying.
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Adavale Resources insiders own about AU$604k worth of shares (which is 54% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Adavale Resources insiders are well aligned, and quite possibly think the share price is too low. Nice!I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph.
Of courseAdavale Resources may not be the best stock to buy. So you may wish to see thisfreecollection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Deutsche Bank under investigation for compliance with money laundering laws: Report
There appears to be more trouble brewing forDeutsche Bankamid reports it is the subject of another investigation.
Federal authorities are examining whether the bank complied with regulations designed to stop money laundering and other crimes, The New York Times reported on Wednesday, citing several people familiar with the inquiry.
The probe covers how the bank handled reports of suspicious activity – including potentially problematic transactions – some of which are linked to President Trump’s son-in-law and senior adviser Jared Kushner.
A spokesperson for Deutsche Bank declined to comment on the report, but told FOX Business it remained committed to cooperating with authorized investigations.
A whistleblower previously told the Times that she had flagged suspicious money transfers between Kushner’s family company and individuals in Russia in 2016. The whistleblower said Deutsche Bank managers decided not to file the suspicious activity report she prepared to the Treasury Department’s financial crimes division. According to The Times, there are claims that other suspicious activity reports also were not filed – some pertaining to transactions involving Trump’s legal entities.
Several other banks are also said to be under investigation as part of a larger probe into the way illicit funds pass through the financial system.
Meanwhile, the bank is the focal point of separate congressional investigations, looking into its relationship with Trump, his family and his businesses. House Democrats are hoping to obtain more information about Trump’s financial affairs, potential dealings with Russia, and to look into possible connections to interference in U.S. elections.
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The president sued to block Deutsche Bank and Capitol One from complying with subpoena requests to turn over his financial and business records. After a judge struck down the request, the president’s lawyers were expected to appeal.
Democrats are also asking for Trump’s financial records from the IRS. The Treasury Department, under Secretary Steven Mnuchin, has so far failed to comply.
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GE Aviation: A Shining Star in Slowing Aerospace Sector?
At the Paris Air Show this week, all eyes in the aviation industry are watching how recent turmoil will impact order performance. The past few years have been stellar for the industry, with growth 40% higher than the market over the last three years. But this positive growth trend may be about to change.
Industry Struggles
There have been many recent indicators that the aviation industry, which is highly cyclical, will hit a downturn soon. In an interview this week, Centre for Asia Pacific Aviation chairman Peter Harbison stated that “We probably did see a peak in aircraft order last year which… seems to precede the year when things turn down.” Meanwhile, demand in global air freight markets fell by 4.7% from this time last year, according to the International Air Transportation Administration. The IATA also cut its expected 2019 airline profits by 6.67% to $20 billion.
Order numbers are in fact slacking at the 2019 Paris Air Show. Wednesday marked only the third day of the four-day event, but orders are on pace to be 375 planes lighter than last year, a 25.6% decrease.
The jetliner industry is essentially a duopoly, with Airbus EADSY and Boeing BA making up 89.6% of jet aircraft deliveries in 2017. As a result, Boeing’s recent struggles have impacted the entire industry. The two tragic crashes of Boeing’s 737 MAX aircraft and the subsequent grounding only caused 49 out of 5,008 orders to be cancelled. Yet recent focus groups indicate that many travelers would not be willing to fly on one of these planes. Meanwhile, the Boeing 777x, which is currently in development, has had its timeline delayed due to engine issues during testing. As a result, Boeing’s earnings estimates for this year and next have recently been revised down.
GE Rising Above
General Electric GE is one company that seems to have been relatively untouched by the industry struggles. GE’s aviation division makes up about 30% of the company, and holds the largest market share in commercial turbofan engines and military aircraft engines. Plus, its sales are not tied specifically to one aircraft manufacturer, which helps create more stability.
However, GE has a rocky past. Its market cap was up over $260 billion twice over the last 15 years, both times falling to around $90 billion soon after. The current market cap is $90.87 billion as of Wednesday, meaning investors may start to bring up its stock price as GE is at the bottom end of its historical market cap.
Over the past year, GE has underperformed its peer group as shown below. However, some of this can be attributed to GE Power (26% of revenues) showing very little profit, and GE Lighting (4%of revenues) slowly becoming obsolete.
GE is currently a Zacks Rank #2 (Buy), based, in large part, on its recent positive earnings estimate revision activity for this year and next. Zacks Estimates also predict a growth rate next year that is 13% higher than the market.
At the Paris Air Show, GE did $24 billion in sales on the first day, with self-projections calling for more than $35 billion total. This would be a record-breaking sales week for GE, and has the possibility to further boost earnings estimates in the coming weeks.
Bottom Line
The aviation industry seems to be at a tipping point and looks like it may take a dive in the coming year, especially when taking its cyclical history into account. But GE has billions in orders with no big issues in sight. GE also puts roughly $1 billion a year into R&D for its commercial engines, so one can reasonably expect the firm to stay at the forefront of aviation engine manufacturing for a long time.
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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 reportAirbus Group (EADSY) : Free Stock Analysis ReportThe Boeing Company (BA) : Free Stock Analysis ReportGeneral Electric Company (GE) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
The Speed Apparel Holding (HKG:8183) Share Price Is Down 14% So Some Shareholders Are Getting Worried
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Speed Apparel Holding Limited(HKG:8183) shareholders should be happy to see the share price up 12% in the last quarter. But that doesn't change the fact that the returns over the last year have trailed the market. Indeed, shareholders received returns of 12% whereas the market is down, returning (-10%) over the last year.
View our latest analysis for Speed Apparel Holding
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
Even though the Speed Apparel Holding share price is down over the year, its EPS actually improved. It's quite possible that growth expectations may have been unreasonable in the past. It's surprising to see the share price fall so much, despite the improved EPS. But we might find some different metrics explain the share price movements better.
Speed Apparel Holding managed to grow revenue over the last year, which is usually a real positive. Since the fundamental metrics don't readily explain the share price drop, there might be an opportunity if the market has overreacted.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
Thisfreeinteractive report on Speed Apparel Holding'sbalance sheet strengthis a great place to start, if you want to investigate the stock further.
When looking at investment returns, it is important to consider the difference betweentotal shareholder return(TSR) andshare price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Speed Apparel Holding's TSR for the last year was -12%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!
We doubt Speed Apparel Holding shareholders are happy with the loss of 12% over twelve months (even including dividends). That falls short of the market, which lost 10%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. Putting aside the last twelve months, it's good to see the share price has rebounded by 12%, in the last ninety days. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. Before deciding if you like the current share price, check how Speed Apparel Holding scores on these3 valuation metrics.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Dating app user growth is slowing: eMarketer
Americans are swiping left on dating apps.
Growth among smartphone users is still going up, but dating app audiences have been growing slower than expected in recent years, according to research firm eMarketer.
“At this point, we see existing users switching between apps rather than new users trying dating apps for the first time,” said eMarketer forecasting analyst Nazmul Islam.
Data compiled by the firm suggests that 25.1 million adults in the U.S. will use a dating app on their smartphones at least monthly in 2019. That’s a down from last year’s estimate of 25.4 million users.
Indeed, Coffee Meets Bagel co-founder and co-CEO Dawoon Kang reiterated these findings in arecent interview with Yahoo Finance.
“When my sisters and I started this company, we started with a big vision. We wanted to change the way singles experience dating. Dating feels really hard, and if you ask anyone, online dating, particularly, is such an exhausting, disappointing, almost jaded experience. And a few years later, it still is. So we actually haven’t solved the problem that we set out to solve,” said Kang.
Dating apps getting the most love
Among millennials, Tinder is the most popular service, followed by Bumble and PlentyofFish. That’s according to a recent Google study. In fact, eMarketer found that 21% of single adults in the U.S. will use a dating app this year, with that figure expected to barely reach 23% by 2023.
But among Wall Street analysts who cover Tinder’s parent company Match (MTCH), most have a “hold” rating on the stock. The 12-month consensus target price on shares is $69.06.
For the year, shares of Match Group are up nearly 65% as of Wednesday’s market close.
Pamela Granda is a producer on Yahoo Finance’s closing bell show,The Final Round.Follow her onTwitter.
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Delta Air not expecting flight cancellations as result of tech issue
(Reuters) - Delta Air Lines Inc said it was not expecting flight cancellations as a result of a technical glitch that had affected booking, check-in and boarding services.
"While we expect flight delays to extend into the evening at some of our busiest domestic hubs due to this issue and weather, we do not expect any technology-related cancellations," the U.S. airline said in a statement.
"Delta is slowing flights into our busiest hub in Atlanta to reduce congestion."
Some travelers took to social media to express frustration at flight delays caused by the problems.
"Delta my wife and 3 year old son have been in the airport waiting on your attendants for 3 hours. Way to make a trip to Disney great," wrote one user on Twitter.
(Reporting by Mekhla Raina and Ankit Ajmera in Bengaluru; Edititng by Bill Rigby and Stephen Coates) |
Foxconn Game of Thrones Looms as Its King Abdicates
(Bloomberg Opinion) -- On June 11, for the first time in history, Foxconn Technology Group held an investor relations conference for its flagship company.
That’s the good news. The bad news is what the moment portends: The world’s largest electronics manufacturer is about to be left without a CEO.
It took founder Terry Gou’s pending departure from Hon Hai Precision Industry Co. to face its stakeholders beyond the legally mandated annual shareholders’ meeting. Gou didn’t even bother to turn up, choosing instead to continue his campaign to become Taiwan’s president.
After’s Gou’s departure, which could be as soon as Friday, Foxconn will have a new chairman, and the CEO role will be replaced by a committee of nine. For the past 45 years Gou has been the sole decider and face of the company. So while this major shift in leadership brings sudden and long-overdue transparency, it also leaves his sprawling company – which spans more than a dozen nations, up to one million workers, and an all-star client list – in the hands of a committee and without a chief.
I’ve long been skeptical about the company and its future, with or without Gou. As the global tech industry faces both a macroeconomic slowdown and the fallout from U.S.-China trade tensions, Foxconn finds itself caught in the crossfire.
The comportment of the company’s new management now allays some of those concerns. At the investor event and a telephone conference that followed, these executives – many of whom had rarely spoken publicly – succinctly fielded questions about the challenges of running Foxconn in the age of President Donald Trump, the possibility of moving iPhone production out of China, and the company’s need to transform. That’s a refreshing change from the waffling, disjointed answers Gou usually gives to the media.
Still, this doesn’t mean everything is sorted. The debate over Foxconn’s next chairman, which has been raging for more than a decade, continues. Group CFO Huang Chiu-lian, known as Money Mama, was among the names tipped to take control. Heads of various divisions are also being considered.
It’s my belief that Young Liu, currently head of Foxconn’s chip division, will get that job. (Huang isn’t in the running since she won’t be on the new board). Getting the chairmanship, though, doesn’t mean taking Foxconn’s Iron Throne. Rather, this management-by-committee strategy sets the company up for possible infighting among various division chiefs, some of whom are part of that inner circle.
Any executive decision inevitably becomes a question of resource allocation. Since Foxconn is notoriously tight-fisted, divisions will likely need to compete with each other or engage in back-room horse trading to get what they want.
If the collegiality on display at the new team’s first public outing dissolves, then the executive lineup is likely to become a war of attrition. When Gou floated the idea of retirement a dozen years ago, he talked about winnowing his list down from more than 35 to less than 10 possible successors. But he’s never groomed anyone, unlike compatriot Morris Chang, who spent considerable time training up his successors for the company he founded and chaired, Taiwan Semiconductor Manufacturing Co.
More than a few people who follow Foxconn have told me they think that most lieutenants will retire pretty quickly if they don’t get clear control over the company once Gou steps down. As some depart, competition to take the reins may ensue.
My fear is that a series of departures and jostling will weaken Foxconn just when it needs stability and a single leader. Once that shakes out, any eventual winner may find that there’s no throne to take, let alone dragons to fight with.
To contact the author of this story: Tim Culpan at tculpan1@bloomberg.net
To contact the editor responsible for this story: Rachel Rosenthal at rrosenthal21@bloomberg.net
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Tim Culpan is a Bloomberg Opinion columnist covering technology. He previously covered technology for Bloomberg News.
For more articles like this, please visit us atbloomberg.com/opinion
©2019 Bloomberg L.P. |
Algorand Raises $60 Million in Token Sale
Algorand raised over $60 million in atoken saleof its native Algo token onCoinlist,using a Dutch Auction mechanism that ensures market participants set a uniform price per Algo. All 25 million tokens were sold at a market drive price of $2.40.
Company representatives told CoinDesk, the “cryptocurrency auction was the first implementation of its transparent, innovative economic model,” which stresses fairness and inclusivity in an attempt to build a “Borderless Economy.”
Algorand is where “macroeconomics meets cryptocurrency,” writes Michael Arrington of Arrington XRP Capital, in his paper “The Monetary Experiment: Algorand A Thesis For Algo Currency Markets,” published June 17.
Related:Regulators Debate Cryptocurrency Legislation Ahead of G20 Summit
The auction coincided with the official launch of Algorand’s MainNet. The platform handles 1,000 transactions per second with a latency of less than 5 seconds, putting it on par with the throughput of major global payment networks — such as Visa or Mastercard.
Additionally, as a permissionless, pure proof-of-stake blockchain Algorand offers the “bleeding edge cryptography with a clever economic model,” said Arrington.
This is the first time Algos entered market circulation.It is unclear how many buyers participated in the auction, which was originally scheduled to last for more than five hours, but sold out in under four due to oversubscribed global demand.
“Algos are being dispersed to wallet right now (for successful bids). Therefore – there are non on exchanges,” said Keli Callaghan, VP of Marketing at Algorand. Therefore, no market capitalization is available for the firm, though some have speculated it sits around $6 billion. “Which is still a top 10,” Callaghan said.
Related:Brazilian Financial Authorities Announce Regulatory Sandbox For Blockchain
“Our focus in the Algorand ecosystem has been to encourage broad and inclusive participation where global users, not a centralized collection of companies, control the network,” said Silvio Micali, founder of Algorand in a statement.
The Foundation previously said it will auction off 600 million Algos per year, meaning that this most recent auction of 25 million tokens only represents a portion of the forward float. The total token supply of the Algorand platform is 10 billion Algos.
The recent influx of equity, “into a system that is decentralized by design,” is on top of the $66 million the company raised from venture capital firms such as Union Square Ventures and Pillar Venture Capital.
Algorandannouncedearlier this week that its node repository has been open-sourced and that it has entered intoa partnership with Flipside Cryptoto provide a free user engagement analytics suite.
Auction photo via Shutterstock
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• Rhode Island Looks to Adopt Blockchain For Government Use |
IDC Boosts Wearables Forecast for 2019
A few months back, market researcher IDC estimated that the global wearables marketwould approach-- but not top -- 200 million units in 2019, driven largely by watches, ear-worn wearables, and wristbands. A lot can change in three months, and the wearables market is doing so well that IDC has just boosted its 2019 forecast. The firm now believes global wearables shipments will hit 222.9 million, up from the prior forecast of 198.5 million. By 2023, the market may grow to 302.3 million units, up from a prior estimate of 279 million.
It's going to be a few booming years for wearables makers.
Earwear got the biggest upward revision. Image source: Apple.
In terms of product category, watches are still expected to dominate volumes, withApple(NASDAQ: AAPL)leading the way with its Apple Watch. The company recentlydetailed watchOS 6at its WWDC 2019 developer conference, with the next version getting a dedicated App Store and menstrual cycle tracking, among other improvements. The Cupertino tech giant is expected to grab over 25% smartwatch market share in 2023, and cellular connectivity continues to drive demand.
"Not only is the market diversifying in terms of form factors, but it is also diversifying in terms of connectivity and distribution," IDC research manager Jitesh Ubrani said in a statement. "Among all watches, close to half will have the ability to connect to a cellular network by 2023 as consumers along with enterprises and healthcare look to free the watch from the phone and as telcos push forward subsidies or financing options for watches with cellular service."
If you look at the different categories, the biggest revision from IDC's March forecast was in earwear. IDC research director Ramon Llamas added, "Ear-worn devices, while still centered on providing audio, will nudge into other areas like language translation, smart assistant deployment, and coaching."
[{"Product Category": "Watch", "March Estimate for 2019 Volumes": "90.6 million", "June Estimate for 2019 Volumes": "91.8 million"}, {"Product Category": "Earwear", "March Estimate for 2019 Volumes": "54.4 million", "June Estimate for 2019 Volumes": "72 million"}, {"Product Category": "Wristband", "March Estimate for 2019 Volumes": "49 million", "June Estimate for 2019 Volumes": "54.2 million"}, {"Product Category": "Clothing", "March Estimate for 2019 Volumes": "3 million", "June Estimate for 2019 Volumes": "N/A*"}, {"Product Category": "Others", "March Estimate for 2019 Volumes": "1.7 million", "June Estimate for 2019 Volumes": "5 million"}, {"Product Category": "Total", "March Estimate for 2019 Volumes": "198.5 million", "June Estimate for 2019 Volumes": "222.9 million"}]
Data source: IDC. Figures may not sum due to rounding. *Clothing now included in Others.
In somewhat unfortunate timing, Apple had two earwear product announcements shortly after IDC released its March estimate. The tech titanunveiled AirPods 2just a few days later, followed by Beats Powerbeats Pro a couple weeks after that. Both announcements undoubtedly jump-started the market with renewed demand. AirPods 2 and Powerbeats Pro both include a new wireless chip for better performance and hands-free activation of Apple's virtual assistant Siri.
"Interest in AirPods has been off the charts and we're working hard to catch up with incredible customer demand," CFO Luca Maestri said on theApril earnings call.
Growth in wristbands should be fairly flat through 2023, with Chinese vendors Xiaomi and Huawei carrying the market, as over half of wristband unit volumes will be in China. Consumers in developed markets have been switching to smartwatches.
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Evan Niu, CFAowns shares of Apple. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has adisclosure policy. |
What Kind Of Share Price Volatility Should You Expect For AFC Group Holdings Limited (NZSE:AFC)?
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Anyone researching AFC Group Holdings Limited (NZSE:AFC) might want to consider the historical volatility of the share price. Volatility is considered to be a measure of risk in modern finance theory. Investors may think of volatility as falling into two main categories. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The second sort is caused by the natural volatility of markets, overall. For example, certain macroeconomic events will impact (virtually) all stocks on the market.
Some stocks mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
See our latest analysis for AFC Group Holdings
AFC Group Holdings has a five-year beta of 1.01. This is reasonably close to the market beta of 1, so the stock has in the past displayed similar levels of volatility to the overall market. Using history as a guide, we might surmise that the share price is likely to be influenced by market voltility going forward but it probably won't be particularly sensitive to it. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how AFC Group Holdings fares in that regard, below.
With a market capitalisation of NZ$3.7m, AFC Group Holdings is a very small company by global standards. It is quite likely to be unknown to most investors. Companies this small are usually more volatile than the market, whether or not that volatility is correlated. Therefore, it's a bit surprising to see that this stock has a beta value so close to the overall market.
It is probable that there is a link between the share price of AFC Group Holdings and the broader market, since it has a beta value quite close to one. However, long term investors are generally well served by looking past market volatility and focussing on the underlying development of the business. If that's your game, metrics such as revenue, earnings and cash flow will be more useful. In order to fully understand whether AFC is a good investment for you, we also need to consider important company-specific fundamentals such as AFC Group Holdings’s financial health and performance track record. I highly recommend you dive deeper by considering the following:
1. Financial Health: Are AFC’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
2. Past Track Record: Has AFC been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of AFC's historicalsfor more clarity.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Alabama man denies feeding meth to 'attack squirrel'
BIRMINGHAM, Ala. (AP) — An Alabama man wanted on drug and weapons charges has posted a video denying he fed methamphetamine to a so-called "attack squirrel" that he considers a pet. Mickey Paulk posted the video on his Facebook page Tuesday night as authorities continued searching for him. It shows him stroking a rodent that he indicates was the same one seized during a search and then released by authorities. "You can't give squirrels meth; it would kill 'em. I'm pretty sure, (but) I've never tried it," he said. He said the squirrel, which he kept as a pet, was safe and not a threat to anyone. "The public isn't in danger in any kind of way from the methed-out squirrel in the neighborhood," Paulk said with a laugh. Paulk told The Associated Press that a friend gave him the animal shortly after it was born, and he named it "Deeznutz." Stephen Young, a spokesman for the Limestone County Sheriff's Office, said Wednesday investigators were still looking for Paulk, 35, who has an extensive criminal record. "Yes, we're aware of the video," he said. "And yes, that's him in the video." Police said they were warned about a meth-fueled, trained attack squirrel before conducting a drug search at a rural home near Athens, Alabama, on Monday. One man was arrested at the home and police said they released the caged squirrel. In the video, Paulk denied living at the home but said he went there after the raid and saw the pet squirrel in a treetop. The animal scampered down and hopped on his shoulder, he said. "I just pulled up and whistled," said Paulk, who is wanted on warrants accusing him of possession of drugs and an illegal weapon. Deputies released the squirrel in trees near the home, Young said, but there was no way to say whether the squirrel shown in the video is the same one released by officers after the raid. "We don't know if he might even have two squirrels," he said. "It would just be speculation." Story continues Speaking in a phone interview with AP, Paulk said Wednesday that he was working with an attorney and relatives on a plan for turning himself in to authorities. Paulk said he had "a few loose ends to tie up" before surrendering, including getting the squirrel to a temporary home in Tennessee. Paulk said he raised "Deeznutz" since it was a baby. "I've had it since it was a little pink thing," he said. Paulk said he didn't know why authorities believed the squirrel was on drugs unless someone saw it acting excitedly and told police "maybe he's on meth or something." Paulk said he isn't in Athens anymore but wouldn't give his exact location. |
Oracle Investors Breathe a Sigh of Relief on Rising Sales
(Bloomberg) -- Oracle Corp.’s shares climbed after the world’s second-largest software maker returned to sales growth and gave a forecast indicating the momentum may continue. For investors, the results were a reprieve amid the company’s uneven transition to cloud-based computing.
Revenue increased 1.1% to $11.1 billion in the period ended May 31 from a year earlier, the Redwood City, California-based company said Wednesday in a statement. Analysts, on average, projected $10.9 billion, according to data compiled by Bloomberg. Oracle said sales will grow as much as 2% in the current period.
Chief Executive Officers Safra Catz and Mark Hurd have sought to maintain Oracle’s large customer base as the company competes with a dizzying number of rivals in the cloud-computing space. The software maker’s stumbles against Amazon.com Inc. and others have spurred the company to seek help from unlikely sources. Earlier this month, Oracle announced an alliance with longtime rival Microsoft Corp., letting customers use their respective clouds.
The period marked Oracle’s first year-over-year increase in total revenue since the fiscal first quarter.
Oracle shares jumped about 5% in extended trading after closing at $52.68 in New York. The stock has gained 17% this year.
Profit, excluding some expenses, will be 80 cents to 82 cents a share in the period that ends in August, Catz said on a conference call. The forecast is in line with Wall Street’s average estimate of 81 cents. Oracle reported an adjusted profit of $1.16 a share in the fiscal fourth quarter, compared with estimates of $1.07 a share.
Pat Walravens, an analyst at JMP Securities, said Oracle’s sales and profit outlook brought relief to concerned investors.
“These are small numbers but we seem to be making some progress,’’ Walravens said in an interview. “Oracle is doing a nice job on the applications side, but on the infrastructure side you’re competing against Microsoft, Amazon Web Services and the Google Cloud. That remains highly competitive.’’
Larry Ellison, Oracle’s billionaire co-founder and executive chairman, said some corporate applications for the cloud are finally boosting overall growth, even as product lines like the company’s data-broker business declined.
“We are focused on our star products and our star products are now driving the top line higher,” Ellison said on the call. “We have these other businesses that are melting away and we just don’t care.”
Cloud license and on-premise license sales increased 12% to $2.52 billion, suggesting that Oracle is doing a better job of signing on new customers. The company said that revenue from NetSuite grew 32%, and Fusion HR and financial suites gained by the same amount. Hurd has been keen to chase growth by selling apps and set a target for attaining 50% market share to best rival SAP SE.
Revenue from cloud services and license support was unchanged at $6.8 billion in the quarter, Oracle said. While that metric includes revenue from hosting customers’ data on the cloud, a large portion is generated by maintenance fees for traditional software housed on clients’ servers. The unit accounted for more than 60% of total revenue.
Sales of Oracle’s servers declined 11% in the period. Catz said the company has chosen to “downsize our low-margin legacy hardware business,” which Oracle acquired when it bought Sun Microsystems.
Oracle has been firing workers around the world to cut expenses. The company’s adjusted operating margin reached 47%, the highest in five years. The company’s costs related to restructuring also doubled to $168 million in the quarter compared with a year earlier.
The deal between Oracle and Microsoft will allow mutual customers to connect databases on Oracle’s cloud to applications on Microsoft’s Azure cloud. The agreement signified a concession by Oracle that it won’t be able to compete against Amazon Web Services alone. AWS offers cheaper versions of the databases that make up Oracle’s core business.
To contact the reporter on this story: Nico Grant in San Francisco at ngrant20@bloomberg.net
To contact the editors responsible for this story: Jillian Ward at jward56@bloomberg.net, Andrew Pollack, Molly Schuetz
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Can We See Significant Insider Ownership On The Agricultural Land Trust (ASX:AGJ) Share Register?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! If you want to know who really controls Agricultural Land Trust ( ASX:AGJ ), then you'll have to look at the makeup of its share registry. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.' With a market capitalization of AU$3.1m, Agricultural Land Trust is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutions don't own shares in the company. We can zoom in on the different ownership groups, to learn more about AGJ. See our latest analysis for Agricultural Land Trust ASX:AGJ Ownership Summary, June 19th 2019 What Does The Lack Of Institutional Ownership Tell Us About Agricultural Land Trust? Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors. There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. Alternatively, there might be something about the company that has kept institutional investors away. Agricultural Land Trust might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely. ASX:AGJ Income Statement, June 19th 2019 Agricultural Land Trust is not owned by hedge funds. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar. Story continues Insider Ownership Of Agricultural Land Trust The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. Our information suggests that insiders maintain a significant holding in Agricultural Land Trust. Insiders have a AU$460k stake in this AU$3.1m business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently. General Public Ownership With a 12% ownership, the general public have some degree of sway over AGJ. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. Private Company Ownership Our data indicates that Private Companies hold 67%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. Public Company Ownership We can see that public companies hold 6.2%, of the AGJ shares on issue. We can't be certain, but this is quite possible this is a strategic stake. The businesses may be similar, or work together. Next Steps: I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph . Of course this may not be the best stock to buy . So take a peek at this free free list of interesting companies. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Donald Trump team threatens to lay off employees if Congress doesn't eliminate agency
WASHINGTON – President Donald Trump's administration is threatening to furlough or lay off up to 150 employees at the Office of Personnel Management if Congress does not agree to eliminate the federal agency or find a new way to pay for the positions. Members of Congress who oppose the administration's plan to kill off OPM and move its functions elsewhere called the plan an effort to intimidate lawmakers and contend it is an attack on federal workers' rights. "After realizing they were not going to prevail on the merits of the proposal, the Trump Administration is taking 150 federal employees hostage unless we consent to a plan that has no rationale," said Rep. Gerald E. Connolly, D-Va. Connolly, who chairs a government operations subcommittee that has jurisdiction over the agency, called the break-up plan "nothing more than a political gambit to give the White House control of our longstanding merit-based civil service system.” Trump administration officials said furloughs and possibly layoffs may be necessary because the personnel agency is losing revenue after the transfer of one of its core functions: conducting background checks on prospective federal employees. President Donald Trump delivers a statement in the Rose Garden of the White House, on May 22, 2019. The fight over the personnel agencies is one of many budget battles that loom in the run-up to the November 2020 election. When Trump unveiled his 2020 budget in March, he called for deep cuts in an array of domestic programs while also proposing billions for his border wall and higher military spending. But with the House controlled by Democrats, many of his proposals are unlikely to become law. Nominee dropouts: Trump’s picks for administration jobs keep calling it quits 'We're off and running': A look at Donald Trump's un-Trumpian campaign for reelection in 2020 Trump administration officials said OPM, which oversees more than 2 million members of the federal civilian workforce, is outmoded and inefficient. The White House has called for transferring its duties – which range from hiring and firing standards to managing benefits programs – to other parts of the government, particularly the General Services Administration. "We continue to work with Congress to find a solution and sustainable path forward that avoids unacceptable impacts to the staff at OPM," said Jacob Wood, a spokesman for the Office of Management and Budget. "Unfortunately, issues of funding and appropriations law leave OPM with few options." Noting that Congress itself voted to remove background checks from the office's duties, Wood said that "it is our sincere hope that Congress helps us find a way to address the funding gap created by their decision to move a major funding source away from OPM." Story continues Trump administration officials said the overall goal is to eliminate OPM, part of its proposed budget for Fiscal Year 2020 , is a first step in its effort to re-organize and streamline government. But the plan appears to face an uphill battle, given Democratic control of the House. Margaret Weichert, deputy director for management at the Office of Management and Budget, said at a congressional hearing this year that OPM has created "a national personnel system that does not meet modern workforce needs" any longer. “Failure to invest in and re-align HR organization, technology and operations has generated backlogs, service quality issues, cyber risks and problems hiring and retaining top talent,” she said. The Office of Personnel Management received bad publicity in 2015 with a data breach that exposed the private records of millions of public employees. Officials attributed the breach to Chinese hacking; China denied it. This article originally appeared on USA TODAY: Donald Trump team threatens to lay off employees if Congress doesn't eliminate agency View comments |
Coupa Software Inc (COUP) CEO Robert Bernshteyn Sold $7.7 million of Shares
CEO of Coupa Software Inc (NASDAQ:COUP) Robert Bernshteyn sold 63,225 shares of COUP on 06/17/2019 at an average price of $122.25 a share. |
Will Facebook’s Libra Be an On-Ramp or Dead End for Crypto?
Facebook’s announcement that it would create a stablecoin on a blockchain means more as a competitive answer to WeChat and Alipay’s payment services than it does to the crypto industry, according to AngelList co-founder Naval Ravikant.
Ravikant told CoinDesk via email:
“I don’t think it means much for crypto because it’s not really (sovereign-resistant) crypto.”
Related:Senate Banking Committee Schedules July Hearing on Facebook’s Libra Crypto
The immediate question for the crypto industry following the announcement of Facebook’sambitious Libra projectwas whether this new token will lead more users into the broader world of cryptocurrency or insulate them from other projects. That is, will someone who becomes a Libra user be more likely to one day hold bitcoin, ether, EOS or other crypto assets?
For his part, Ravikant sees a way Libra could meet a need, noting that it could lower the cost of global payments, but, he added, “I struggle to see why it needs to be on a blockchain other than for PR / Marketing.”
The Asian consumer payments giants Tencent (parent of WeChat) and Alibaba (parent of Alipay) seem to agree: They say theywon’t be followingFacebook’s lead into cryptocurrency development.
That said, most of the industry sounds upbeat following the news that the fifth largest company in the world by market capitalization, Facebook, isleading a slew of financial giants(such as Visa, PayPal and Stripe) into the blockchain universe.
Related:Facebook Talked to the Fed About Libra, Chairman Powell Says
For example, Fred Wilson, a partner at Union Square Ventures, one of the founding members of the Libra Association, wrote on his blog:
“So as we think about the potential drivers for mainstream crypto adoption, a simple, fully-collateralized, cryptocurrency used inside the world’s largest applications, touching hundreds of millions or billions of consumers, is perhaps the most promising one.”
In fact, others pointed to specific mechanisms by which individuals might find their way into crypto in a world where Libra becomes a common way of transacting value.
“It’s good news for exchanges and good news for crypto because you’ll have a lot more vetted users,” Avivah Litan, an analyst at Gartner, told CoinDesk. She foresaw exchanges as being a major source for attaining Libra in the early days. “So now when you’re signing up for Libra you’re going to see more cryptos as well.”
People who already have access to financial services will be motivated to find ways to get crypto in order to get better deals, Kyle Samani of Multicoin Capital told CoinDesk.
“The value prop is clear: discounts through merchant partners like Uber and Lyft and Spotify (and many more to be announced),” Samani told CoinDesk via email. For the unbanked, it’s the chance to use a currency that’s potentially more stable than their country’s national currency.
Preston Byrne, an attorney at Byrne & Storm and an early entrepreneur in the world of permissioned blockchains, told CoinDesk he foresees Libra being helpful at a high level so long as the network is not built in a walled-off way.
“As long as it requires people who are hooking into the ecosystem to use things that are otherwise good for cryptocurrency, then it’s good for cryptocurrency,” Byrne said.
Joey Krug, Augur’s creator and an investment officer at Pantera Capital – one of the industry’s largest crypto investors – pointed to one way the infrastructure has already committed to play nice with the rest of the industry.
“Libra has stated the underlying network will have pseudonymous addresses just like any other crypto network, which means exchanges can list Libra, effectively making it an on-ramp to all of crypto,” Krug told CoinDesk.
Byrne did note that Facebook and its partners could use their clout to crowd out other cryptocurrencies, if they wanted to. For her part, Arianna Simpson, founder of Autonomous Partners and a former Facebook employee, does not see an existential threat to bitcoin in Libra.
“Other cryptocurrencies – Stellar and Ripple come to mind – are much more likely to have their raison d’être called into question,” she wrote in a note to her limited partners, which was shared with CoinDesk.
In fact, on bitcoin, Samani offered another tantalizing bit of speculation. He argued that with interest rates on sovereign bonds moving sowidely into negative territory, the Libra reserve is going to have a hard time finding extremely conservative investments with an upside.
Samani said:
“I would expect the Libra Association to maintain some of its reserves in permissionless cryptocurrencies like BTC. So that’s one path, though it’s not confirmed.”
If Facebook is able to convince the world that crypto works, Libra itself will have to work. And that’s no sure thing.
Industry insiders were quick to recall the many headline-grabbing tech products that never caught on.
That said, the general response seems to be excitement about Facebook and its partners potentially educating billions of people about public-private keys, payments without intermediaries and money on the internet.
But there were a lot of notes of caution, particularly about whether or not Facebook could really lead users to use its new blockchain.
Joel Monegro of Placeholder, a prominent New York City-based venture fund, compared it to the earliest iterations of theMicrosoft Network, which was basically Microsoft’s attempt to create its own proprietary internet.
Monegro told CoinDesk via email:
“Libra is to Facebook what MSN was to Microsoft. They sense the opportunity, but are missing the point.”
Similarly, CoinFund founder Jake Brukhman rattled off a list of major failures by other tech giants. Though generally optimistic about Libra’s potential to benefit the whole market, Brukhman cautioned that “people also tend to get excited and underestimate how hard it is to launch successful products even as established exceptional companies.”
For example, he mentioned Amazon’s Fire Phone. Additionally, Google has had a cascade of failed creations. In social media alone, it failed with Orkut, Buzz, Wave and Google Plus. Apple’s self-driving car product was stillborn.
But Albert Wenger, also of Union Square Ventures,wrote on his blogabout how critical a wide distribution network has been at key moments of technological expansion. He too drew an example from Microsoft: the introduction of Internet Explorer (IE) to all Windows users in 1995.
IE drove tremendous adoption of the internet. But, as Wenger wrote, “It is useful to remember that Microsoft was not the primary beneficiary of the web.”
The 53 co-authors of“The Libra Blockchain” white papersaid the blockchain was built to offer “a new global currency — the Libra coin.” Currencies are money’s consumer application, but will be Libra be consumer-friendly?
William Quigley was a co-founder of the company that created tether, the original stablecoin, and he’s now the CEO of WAX, a startup organized around digital property rights. He thinks Libra will save people money on almost everything they buy.
“It’s probably 1.5 percent of global GDP is just eaten up in currency conversions,” Quigley estimated. “I think that’s a big part of what Facebook is looking at.”
Others aren’t betting against the world’s entrenched financial institutions, however.
As Tyler Cowen, one of the globe’s most influential economists, wrote onhis blog: “Have banks ever lost a political battle of this kind?”
If any coalition could uproot those channels, it may be the group of extremely powerful companies Facebook has assembled. But that sheer size could pose another danger to the masses.
“It comes with the risks of centralized pain points and vulnerabilities,” ConsenSys founder Joseph Lubin told CoinDesk. “Data silos enable incumbents to maintain pricing power, and also come with the risks of data breaches, privacy, and security issues – problems that many have already begun to associate with Facebook.”
Maya Zehavi, a blockchain consultant and entrepreneur, offered similar concerns. While Facebook theoretically won’t control the Libra blockchain, earlier iterations of the company have been known to wreak havoc on startups that build businesses dependent on Facebook platforms. Just ask Zynga.
At this very early date, Zehavi said Libra looks like a “closed loop.”
“If you want to make an investment or if you want to run a product today, you need to be able to run a node, a full node,” she said. “You need to have the infrastructure in place to be a part of that network.” Plus, there’s the cost.
Founding members of the Libra Association have paid $10 million each for the privilege of running a node, though there are plans to ultimately open node membership to anyone. (Founding members also get a return on their investment in the form of interest generated by the Libra reserve’s potentially vast pool of coin-backing assets.)
Still, Quigley, the tether creator, thinks the 10 years of crypto history to date should be the main framework for evaluating Facebook’s Tuesday announcement. Several people CoinDesk spoke to made some version of his same point:
“Every time a new cryptocurrency has been created it has been additive to the overall crypto experience.”
Scalesimage via Shutterstock
• China’s Biggest Payment Firms Have No Plans to Follow Facebook into Crypto
• ‘I Don’t Trust Facebook With Anything:’ The World Reacts to Facebook’s Libra |
Google, Pharma Giant Sanofi Team Up to Discover Drugs: Brainstorm Health
Happy hump day, readers.
Another big pharma company is seeking reinvention in the digital era. This time around, it’s Sanofi, the French drug mainstay long known for its insulin and diabetes portfolio – but which has faced mounting pressures in a crowded field choc full of competitors.
Now, Sanofi and Alphabet’s Google are teaming up to use data collection and artificial intelligence in a bid to spur drug development and changes in health care delivery.
“Combining Sanofi’s biologic innovations and scientific data with Google’s industry-leading capabilities, from cloud computing to state-of-the-art artificial intelligence, we aspire to give people more control over their health and accelerate the discovery of new therapies,” said Sanofi chief medical officer and EVP Ameet Nathwani in a statement.
The purpose of the Sanofi/Google partnership is three-fold and will be conducted with the help of a newly established, virtual Innovation Lab (the companies didn’t disclose the financial terms of the deal): better understanding diseases, increasing corporate efficiency, and improving patient/customer experience.
In other words: This is every bit as much of an operational streamlining and high-tech marketing effort (for instance, by using Google technology to better design sales forecasts through the use of real-world datasets) as it is a quest to develop new drugs. And Google’s cloud services will play a large part in that quest, as similar technologyexpands its role across multiplelife sciences companies.
Read on for the day’s news.
Sy Mukherjee@the_sy_guysayak.mukherjee@fortune.com
1. DIGITAL HEALTHSan Francisco may ban e-cigarette sales altogether.The war on e-cigarettes and vaping appears to continue unabated. The latest salvo: San Francisco may ban all e-cigarette sales in the city, which would make it the first to implement such stringent regulations if approved. “Young people have almost indiscriminate access to a product that shouldn’t even be on the market,” said City Attorney Dennis Herrera in a statement. “It’s unfortunately falling to states and localities to step into the breach.”(Fortune)
2. INDICATIONSThe vaccine skepticism problem is global.Public health group Wellcome is out with awide-ranging reportfinding that some regions of the world have deeply concerning ambivalence, and even antipathy, toward vaccines. While trust in immunizations largely remains high (nearly 80% in the large global survey said they were “safe”), several nations including France and countries across North America and Europe had strikingly low levels of confidence in vaccines. Regions that have reckoned with infectious diseases on a widescale, including Rwanda and Bangladesh, were much more likely to believe in the safety and efficacy of vaccines.(Wellcome)
3. THE BIG PICTUREPresidential candidates assure you they’ll cure cancer and/or AIDS.Curing cancer is a personal cause for former Vice President and current presidential candidate Joe Biden. But Biden’s ambitious promise to become the president who will cure cancer has galvanized some criticism since, well, that’s an enormously difficult task, and cancer is not one but hundreds of different diseases. Some of the nastier attacks on Biden’s quixotic quest have built from that reality (including some mockery from Donald Trump, Jr.). President Trump, for his part, has also sworn to try and cure cancer as well as eradicate HIV/AIDS. Noble goals all around; easier said than done.(CNN)
4. REQUIRED READINGFortune Brainstorm Finance 2019: The Livestream,by Andrew Nusca4 Things Investors Need to Know About Slack’s Direct Listing,by Anne SradersHappy Juneteenth: RaceAhead,by Ellen McGirtAnother Controversial Chemical Found in Popular Blood Pressure Medication,by Chris MorrisProduced by Sy Mukherjee@the_sy_guysayak.mukherjee@fortune.comFind past coverage. Sign up for other Fortune newsletters. |
How Many Code Agriculture (Holdings) Limited (HKG:8153) Shares Did Insiders Buy, In The Last Year?
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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares inCode Agriculture (Holdings) Limited(HKG:8153).
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
View our latest analysis for Code Agriculture (Holdings)
In the last twelve months, the biggest single purchase by an insider was when Non-Executive Director Dequn Wang bought HK$9.0m worth of shares at a price of HK$0.06 per share. That means that an insider was happy to buy shares at above the current price of HK$0.022. Their view may have changed since then, but at least it shows they felt optimistic at the time. To us, it's very important to consider the price insiders pay for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Over the last year, we can see that insiders have bought 290.8m shares worth HK$16m. On the other hand they divested 109.3m shares, for HK$3.4m. Overall, Code Agriculture (Holdings) insiders were net buyers last year. The chart below shows insider transactions (by individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at thisfreelist of companies. (Hint: insiders have been buying them).
Over the last three months, we've seen significantly more insider buying, than insider selling, at Code Agriculture (Holdings). We can see that Chairman Gang Qian paid HK$5.0m for shares in the company. But we did see Kai Ming Tsang sell shares worth HK$1.5m. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Code Agriculture (Holdings) insiders own 46% of the company, worth about HK$36m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
The recent insider purchase is heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. When combined with notable insider ownership, these factors suggest Code Agriculture (Holdings) insiders are well aligned, and quite possibly think the share price is too low. Looks promising! To put this in context, take a look at how a company has performed in the past. You can accessthisdetailed graphof past earnings, revenue and cash flow.
But note:Code Agriculture (Holdings) may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Welcome to the Next Generation of Corporate Phishing Scams
All it takes is for one employee to open and click on a bogus email to compromise a company’s corporate security.
Despite analyst estimates that companies will cumulatively spend more than $120 billion a year on cybersecurity, corporations are still facing an increase of hacking attacks and data breaches.
The problem, according to cybersecurity strategist Adenike Cosgrove of Proofpoint, is that much of this security spending is on technology products that aim to “secure” corporate networks and devices. What these tools can’t prevent is a random worker from being tricked by phishing attacks, she explained on Wednesday duringFortune’sBrainstorm Finance conferencein Montauk, N.Y.
With companies spending more on cybersecurity products guarding corporate networks, criminals have wisened up and realized that they would be more successful if they were to individually target employees with scam emails, Cosgrove said. In some cases, these hackers know that certain employees based in company branch offices might have access to sensitive corporate systems, and so they plan their phishing scams accordingly.
Even worse, hackers are updating their phishing tactics to target even more workers, said Amy Chang, the head of strategic intelligence and cybersecurity operations forJPMorgan Chase.
Chang said that hackers were able to compromise an unnamed financial institution by calling an employee under the guise that the call was legitimate, a tactic known as vishing, as in “voice” and “phishing.” After building trust with the worker, the scammer directed the employee to open and click on a bogus email, thus compromising the company’s security.
“The evolution is definitely happening, and they incorporating a lot of new techniques,” Chang said about more sophisticated phishing scams.
It’s not all hopeless, however. Teaching employees how to recognize phishing and other cyber scams is very helpful, as long as the training is ongoing and not relegated to a one-time session, Cosgrove said.
But what about the poor employees who can’t catch on to scams? Should companies fire these untrainable workers because they pose a security risk?
“I think it’s too early to be at the point to say we fire people,” Cosgrove said.
—Brainstorm Finance 2019: Watch the livestreamof the inaugural conference
—Bank of America CEO: “We want acashless society”
—Tala CEO: HowFacebook’s Libra cryptocurrencycan help companies scale
—Charles Schwab CEO: Actually, we’rekilling it with millennials
—Listen to our new audio briefing,Fortune500 Daily
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UN envoy: Goal now must be Afghan-Taliban peace negotiations
UNITED NATIONS (AP) — All peace efforts in Afghanistan including a new initiative by Germany and Qatar for talks among Afghans must be aimed at starting formal negotiations between the government and the Taliban, the U.N. envoy for the war-torn country said Wednesday. Tadamichi Yamamoto told the Security Council he's encouraged by increasing support for a political settlement and called on countries "with direct contacts and with influence over the Taliban to intensify their efforts toward this goal." Germany's deputy U.N. ambassador Jurgen Schulz said there is "great support" from the Afghan government, other key political actors and civil society for an "Intra-Afghan Dialogue Conference" in the Qatar capital Doha. But he said there are still "obstacles," stressing the need for a united international community to send the Taliban and other Afghan parties a clear message "that it is time to talk about a common future." The first talks between the Taliban and the Kabul government were scheduled to start in late April in Qatar but were indefinitely postponed after a falling out over the delegations that should attend. Before the postponement, U.S. special peace envoy Zalmay Khalilzad, who has met on several occasions with the Taliban and has pressed for Afghan-to-Afghan talks, had hoped the Qatar meeting would bring the sides closer to a "roadmap" for a future Afghanistan. With political efforts currently stalemated, Afghan government forces on the ground face not only a resurgent Taliban but also militants from the Islamic State group. A report by U.N. experts circulated Wednesday said the number of Taliban fighters, facilitators and non-combatants are estimated at approximately 100,000. The experts monitoring sanctions against the Taliban said during the past 12 months, "control of 40 percent to 50 percent of Afghan territory was contested between the Taliban and government forces." Story continues The panel of expert said between 25 and 30 districts are now reported to be under full Taliban control, roughly double the number it reported last year. "The Taliban have continued to undermine the morale of the Afghan National Defense and Security Forces by carrying out nocturnal attacks against isolated checkpoints, aided by new supplies of night vision scopes and sniper rifles arriving into Taliban arsenals," the panel said. "This simple yet effective tactic has aided the Taliban's battle for control of rural areas and is likely a key reason for the Afghan National Defense and Security Forces ceding further ground to Taliban forces this year in an effort to consolidate government-held areas without taking excessive casualties in remote military outposts," it said. The experts said the Taliban remain the primary partner for all "foreign terrorist groups" operating in Afghanistan including al-Qaida, except for the Islamic State extremist group. It said IS suffered military setbacks in the past year "but Afghanistan remains its largest and most threatening manifestation" outside Syria and Iraq. The Islamic State group "is still assessed as commanding between 2,500 and 4,000 fighters" and it has carried out a series of attacks, the experts said. The experts noted that the Taliban took advantage of parliamentary elections last October "to harass overstretched government forces and disrupt the process itself." The panel said Afghan security officials are concerned about preparations for presidential elections scheduled for September 28th. "Many observed that it would be difficult to fight the Taliban and protect the elections at the same time, as had proved to be the case with parliamentary elections in October 2018," the experts said. U.N. envoy Yamamoto said the U.N. is working with the new Independent Electoral Commission and Election Complaints Commission, both headed by women for the first time, in all aspects of election preparations. "The political stakes are high and competition is intense," he said. "It is the responsibility of all political actors, including presidential candidates, and of security and government agencies, to ensure that the elections are contested on a level playing field" — with all candidates having equal access to state resources. |
Max Scherzer pitching with broken nose, massive black eye
On Tuesday, Washington Nationals pitcher Max Scherzer broke his nose when a ball bounced off his bat and hit him in the face while he was practicing bunting. We learned later that Scherzer, who was scheduled to start Wednesday against the Philadelphia Phillies, had broken his nose. The team announced that a CT scan came up negative, but surely Scherzer was going to miss at least a start with the face injury, right? Wrong. Despite having a broken nose and massive black eye, Max Scherzer opted to take the mound against the Phillies Wednesday -- and he pitched a gem. (Reuters) Scherzer ‘very adamant’ about starting Manager Dave Martinez told reporters that Scherzer was “very adamant” about pitching Wednesday during the nightcap of a double-header against the Phillies . Pitch he did, as he took the mound as the Nationals starter. He’s not a player who normally wears eyeblack. But if he was, he was already covered under his right eye. That’s a shiner LETS GO!!!!! pic.twitter.com/PZEfDffNDz — F.P. Santangelo (@FightinHydrant) June 19, 2019 If anything, the fastball hurler took the mound with an extra intimidation factor. Somehow, Max Scherzer is even more intimidating now. pic.twitter.com/Y5C6S1LI3h — Cut4 (@Cut4) June 19, 2019 He appeared to have a little extra heat than normal to start the game. Max Scherzer average fastball velocity this season: 94.8 mph Max Scherzer average fastball velocity this inning: 96.5 mph Max is fired up. — Sam Fortier (@Sam4TR) June 19, 2019 He also had some support in the stands. When you nose, you nose. pic.twitter.com/bG6ITBClsZ — Nationals on MASN (@masnNationals) June 20, 2019 Scherzer spins a gem Scherzer didn’t appear any worse for wear, striking out 10 Phillies batters over seven innings of a 2-0 win . Story continues It sounds like Martinez made the right call putting his banged-up ace on the mound. More from Yahoo Sports: CP3, Harden relationship deemed ‘unsalvageable’ From mid-major to NBA draft: Morant's historic rise Coach K on Zion’s NBA potential: 'He’s a gift from God' Why D-Wade supported son at Miami Pride |
Why Slack chose not to go with a traditional IPO
Tech unicorn Slack is set to go public on Thursday under the ticker “WORK” in adirect listing, meaning there is no price set ahead of trading and no banks are underwriting a new offering.
“Basically whoever owns the shares before it goes public just lists the shares and they’re for sale,” Michael Wade, IMD Business School Professor, told Yahoo Finance’sThe Final Round.
So, what are the advantages of a direct listing relative to a traditional IPO?
“It saves a lot of time. It saves a lot of money,” Wade added. “But I think the key thing to note is it’s not raising any new funds.”
While Slack is not yet profitable, it’s got liquidity. The company reported cash and cash equivalents of $841 million in its most recent fiscal year, which is enough to keep the company going for nearly a decade based on its current pace of cash outflow.
Slack is following in the footsteps of music streaming service Spotify (SPOT) which debuted last year, also through a direct listing. Shares opened up almost 26% above its reference price. This debut was thought to pave the way for other IPOs to take an alternative route when looking to go public, but that hasn’t been the case.
So why have other tech companies like Uber (UBER) and Lyft (LYFT) chosen a traditional IPO over a direct listing?
“We don’t see that many [direct listings]. Maybe it’s because most companies want to raise funds in an IPO. Maybe [Slack] feels it doesn’t necessarily need to raise a lot of money,” Wade said.
For investors looking to buy shares of Slack, a big concern with a direct listing is the elimination of a lock-up period. Some employees or early investors have the ability to dump their shares as soon as trading begins, which could tank the price of shares.
But Wade says for investors looking to get a piece of Slack: “If you’re hoping to get an increased value of the stock over time, maybe it’s not a bad way of doing it. We’ve seen a lot of these companies go up in value.”
The New York Stock Exchange (NYSE) on Wednesdayset a reference pricefor shares of Slack at$26.00.
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Sara Dramer is a Producer for Yahoo Finance. Follow here on twitter@saradramer
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Interested In The Hour Glass Limited (SGX:AGS)? Here's What Its Recent Performance Looks Like
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When The Hour Glass Limited (SGX:AGS) released its most recent earnings update (31 March 2019), I compared it against two factor: its historical earnings track record, and the performance of its industry peers on average. Understanding how Hour Glass performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see AGS has performed.
View our latest analysis for Hour Glass
AGS's trailing twelve-month earnings (from 31 March 2019) of S$70m has jumped 41% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 0.9%, indicating the rate at which AGS is growing has accelerated. What's enabled this growth? Well, let’s take a look at whether it is only because of industry tailwinds, or if Hour Glass has seen some company-specific growth.
In terms of returns from investment, Hour Glass has fallen short of achieving a 20% return on equity (ROE), recording 12% instead. However, its return on assets (ROA) of 11% exceeds the SG Specialty Retail industry of 7.8%, indicating Hour Glass has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Hour Glass’s debt level, has increased over the past 3 years from 12% to 14%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 11% to 2.6% over the past 5 years.
Though Hour Glass's past data is helpful, it is only one aspect of my investment thesis. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I suggest you continue to research Hour Glass to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for AGS’s future growth? Take a look at ourfree research report of analyst consensusfor AGS’s outlook.
2. Financial Health: Are AGS’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Sony's Big Activist Investor Flips Its Prior Thesis Upside Down
Dan Loeb's Third Point recently revealed that it had accumulated a $1.5 billion stake inSony(NYSE: SNE), and advocated a spin-off of its semiconductor business to finance a more aggressive expansion of its film and gaming businesses.
Third Point's stake in Sony wasn't surprising, since it has already invested in the Japanese conglomerate before. However, its proposal stunned many investors since it marked a complete reversal from its prior suggestions for Sony.
Image source: Getty Images.
Back in 2013 Third Point accumulated a 7% stake in Sony and pushed the company to spin off its movie business. Sony rejected the idea, but cut costs to improve its profitability. Third Point sold its stake in Sony the following year, and Sony Pictures subsequently struggled with data breaches and box office flops.
Third Point started building a new position in Sony earlier this year. At the time, Reuters reported that the fund wanted Sony to consider selling its film unit and evaluate the importance of its insurance and semiconductor units. However, Third Point's recent announcement flipped that thesis upside down.
Sony's semiconductors unit mainly makes image sensors for cameras and mobile devices. It provides image sensors for about half the smartphone market, and its top customers includeApple,Samsung, andHuawei.
This unit enables Sony to profitfrom the growthof the smartphone market without owning a market-leading brand. Its own Xperia brand, which was marginalized by Samsung and other Android device makers, controls less than 1% of the market.
Global smartphone shipments fell 4% in 2018 according to IDC. Smartphone makers sold less units, but they still bought more of Sony's image sensors for their multi-camera devices.
Higher sales of those mobile sensors offset lower sales of its sensors for traditional cameras, and Sony's semiconductor revenue grew 3% annually and accounted for 10% of its top line. It expects that figure to rise another 13% this year as it sells more image sensors and 3D sensors for multi-camera phones.
Image source: Sony.
The semiconductor unit's revenue growth looks healthy, but its operating income, which accounted for 16% of Sony's total operating profits, fell 12%. That decline was attributed to higher R&D expenses and a tough comparison to its results in 2017, which included one-time gains from divestments and earthquake-related insurance payments.
Yet Sony expects the unit's operating profit to stay flat this year, which indicates that it isn't a dead weight like Sony'sunprofitable mobile business. Loeb believes that the chipmaking unit could fetch up to $39 billion in a sale, but several analysts scoffed at that valuation. Macquarie Group analysts Damian Thong and Hiroshi Taguchi, for example, value the unit at just $11 billion.
The gaming unit, Sony's core growth engine in recent years, is running out of room to grow as its PS4 hardware sales wane. The unit is offsetting its weaker hardware sales with higher software sales, but that strategy will lose steam as gamers postpone their purchases and wait for thePS5's arrivalnext year.
Pumping more cash into the gaming unit's R&D and marketing efforts could give it a much-needed boost as it faces off againstMicrosoft's(NASDAQ: MSFT)next-gen Xbox. It could also help the gaming unit land more exclusive titles, expand its PS Plus ecosystem, and strengthen its PS Now cloud gaming platform.
The film unit, however, is a mixed bag. The expansion of its Spider-Man universe withVenomandSpider-Man: Into the Spider-Versewas well-received, but it clearly lacks the theatrical firepower to go toe-to-toe againstDisney. Sony's film revenue fell 2% last year, and recent films likeMen in Black Internationalhave generated disappointing returns.
Pumping more cash into movies is tremendously risky, and massive budgets don't guarantee big box office returns. Therefore I'm not convinced that selling the stable semiconductor unit to fund more films is the right move.
Loeb's $1.5 billion stake represents just over 2% of Sony's enterprise value. Sony didn't listen to Loeb when he held a 7% stake in 2013, so it's doubtful that they'll listen now. Loeb also sold his original position in 2014, yet the stockmore than tripledover the past five years on the strength of its gaming unit. Given that track record, I'm not sure why Sony, investors, or analysts should care about Loeb's new thesis.
I personally think Sony should keep its semiconductor business. If it wants to sell something, it should consider dumping its money-burning mobile division instead.
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Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool's board of directors.Leo Sunowns shares of Apple and Walt Disney. The Motley Fool owns shares of and recommends Apple, Microsoft, and Walt Disney. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has adisclosure policy. |
U.S. Dollar Falls After Fed Decision; BOJ Holds
Investing.com - The U.S. dollar fell to three month lows against a currency basket on Thursday in Asia after the Federal Reserve signalled it was prepared to lower interest rates amid mounting concerns over the global growth outlook.
The U.S. dollar index that tracks the greenback against a basket of other currencies was down 0.2% to 96.385 by 11:26 PM ET (03:26 GMT).
The U.S. central bank left borrowing costs unchanged on Wednesday, but suggested it could ease monetary policy as early as next month amid mounting concerns over the economic impact of global trade tensions and subdued inflation.
"The main question is no longer if the Fed will cut rates in July, but whether the easing will be by 25 or 50 basis points,” said Daisuke Karakama, chief market economist at Mizuho Bank, in a Reuters report.
Meanwhile, the Bank of Japan kept monetary policy steady on Thursday, but echoed the Fed in warning that global risks were increasing amid trade tensions and uncertainty over U.S. economic policies, signaling that it, too, is leaning more toward ramping up monetary support.
The USD/JPY was down 0.4% to 107.60 following the release of the statement.
The NZD/USD pair gained 0.6% to 0.6573. Data showed today that New Zealand’s GDP growth for the quarter ended March was at 0.6%, in line with expectations. However, some said underlying weakness in the housing market and immigration added to the rising external pressure on the economy.
The AUD/USD pair rose 0.2% to 0.6894.
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Why Amazon Says It Won't Be Taking on the Big Banks Anytime Soon
WithFacebookannouncing plans to launchLibra,a cryptocurrency, we appear to be entering in a new era of big tech wading into major financial undertakings.
So, should we expect a significant move fromAmazonon that front? Perhaps a digital currency of it’s own—or a push to compete with the big banks by offering other types of financial products?
Not anytime soon, said Patrick Gauthier, Vice President of Amazon Pay, speaking atFortune‘s inauguralBrainstorm Financeconference in Montauk, N.Y. on Wednesday.
“At Amazon, we don’t really deal in the speculative,�� he said. Instead, the company lets data—of which it has quite a bit—drive its decision making about new products. “We always start from an identified need that we have the capacity solve,” Gauthier added. Another requirement: the solution must have the ability to scale.
“The fact that we can build something doesn’t mean that we should,” he told the crowd.
When it comes to dabbling in the financial realm, the mega-retailer prefers to go the partnership route. “Amazon is a very pragmatic company,” Gauthier said. The key questions the company asks itself are, “What do we have to build, who do we have to partner with,” he said.
As an example, Gauthier pointed to a partnership the company recently launched withSynchrony, whose CEO Margaret Keane was also on the panel. Called “Amazon Prime Store Card Credit Builder,” the new card lets consumers with bad or no credit put down a refundable security deposit, which is used to set the card’s total credit limit. And in using the product, shoppers have the ability to build credit and improve their score.
Keane noted that Synchrony’s partnership with Amazon—the financial company provides white label cards to the retailer—goes back more than decade. She says she considers serving Amazon’s customers “a huge responsibility.” Such important partnerships incentivize the company to provide Amazon shoppers with the best possible experience, says Keane: “We have to deliver.”
—Brainstorm Finance 2019: Watch the livestreamof the inaugural conference
—Bank of America CEO: “We want acashless society”
—Tala CEO: HowFacebook’s Libra cryptocurrencycan help companies scale
—Charles Schwab CEO: Actually, we’rekilling it with millennials
—Listen to our new audio briefing,Fortune500 Daily
Sign up forThe Ledger, a weekly newsletter on the intersection of technology and finance. |
What Percentage Of AJ Lucas Group Limited (ASX:AJL) Shares Do Insiders Own?
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A look at the shareholders of AJ Lucas Group Limited (ASX:AJL) can tell us which group is most powerful. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.
With a market capitalization of AU$59m, AJ Lucas Group is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about AJL.
See our latest analysis for AJ Lucas Group
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
As you can see, institutional investors own 5.1% of AJ Lucas Group. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at AJ Lucas Group's earnings history, below. Of course, the future is what really matters.
AJ Lucas Group is not owned by hedge funds. There is some analyst coverage of the stock, but it could still become more well known, with time.
The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own some shares in AJ Lucas Group Limited. In their own names, insiders own AU$4.7m worth of stock in the AU$59m company. This shows at least some alignment, but I usually like to see larger insider holdings. You canclick here to see if those insiders have been buying or selling.
The general public, with a 22% stake in the company, will not easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
With a stake of 53%, private equity firms could influence the AJL board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.
It seems that Private Companies own 11%, of the AJL stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
It's always worth thinking about the different groups who own shares in a company. But to understand AJ Lucas Group better, we need to consider many other factors.
I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can checkthis free report showing analyst forecasts for its future.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Democrats demand answers on Trump's approach to Iran
WASHINGTON (AP) — Democratic lawmakers demanded clarity Wednesday about the Trump administration's position on the use of military force as they sought answers on how the White House plans to address rising tensions with Iran. The lawmakers specifically pointed to what they called tenuous links between Iran and al-Qaida that they fear the administration could use to justify a military attack under an authorization granted by Congress after the Sept. 11 attacks. The U.S. special envoy for Iran, Brian Hook, told the House Committee on Foreign Affairs that questions about the authorization would be better answered by a lawyer. But he added, "If the use of military force is necessary to defend U.S. national security interests, we will do everything that we are required to do with respect to congressional war powers and we will comply with the law." Rep. Ted Deutch, D-Fla., referenced Pompeo's testimony to Congress in April, when he said, "There is no doubt there is a connection between the Islamic Republic of Iran and al-Qaida." Pompeo continued: "They have hosted al-Qaida. They have permitted al-Qaida to transit their country." Sen. Marco Rubio of Florida, who sits on both the Senate Foreign Relations and Intelligence committees, said he does believe there is a link between Iran and al-Qaida. But he also said the authorization Democratic lawmakers are referencing is "irrelevant" because it would not be needed "to respond to an attack, and to prevent one if it's imminent." The Trump administration and Iran have said they are not seeking war, but many lawmakers fear that as the U.S. builds up its forces in the region, it increases the chances of the two sides being accidentally drawn into a conflict. Hook also delivered a classified briefing on Iran to a group of senators Wednesday. Senators exiting the room declined to reveal details, but said it covered intelligence linking Iran to a recent attack on tankers as well as wider U.S. policy in the region. Story continues Sen. Jeanne Shaheen, D-N.H., said members asked about what's next and what American allies are thinking. Hook told the House committee that Trump's Iran policy has so far been successful and it is ultimately aimed at bringing Tehran to the negotiating table. "No one should be uncertain about our desire for peace or our readiness to normalize relations should we reach a comprehensive deal," he said. "We have put the possibility of a much brighter future on the table for the Iranian people." The Trump administration withdrew from the nuclear deal negotiated with Iran under President Barack Obama and began imposing layers of punishing sanctions on Tehran that have strangled its economy. The U.S. blames Iran for a number of attacks against U.S. or Western interests in the Middle East over the past few months, including on tankers near the Persian Gulf and a rocket attack near the U.S. Embassy in Baghdad. Iran denies responsibility for the attacks. Lawmakers, Democrats in particular, question whether the administration's so-called maximum pressure campaign is really a recipe for war. "Rather than force Iran back to the negotiating table, the administration's policy is increasing the chances of miscalculation, which then would bring the United States and Iran closer to a military conflict," Deutch said. Hook responded by saying Iran has chosen to use military force despite Trump's Iran policy largely relying on diplomatic and economic tools like sanctions. "Our policy is at its core an economic and diplomatic one. But Iran has not responded to this in a diplomatic fashion, it has responded to it with violence. We very much believe that Iran should meet diplomacy with diplomacy, not with terror, bloodshed and extortion," he said. On Monday, Iran said it could soon start enriching uranium to just a step away from weapons-grade levels, breaching a cap that was set under the nuclear deal abandoned by the United States. The announcement followed warnings from President Hassan Rouhani that a new deal needs to be in place by July 7 or the Islamic Republic would increase its enrichment of uranium. |
If You Had Bought Great Wall Pan Asia Holdings (HKG:583) Stock A Year Ago, You'd Be Sitting On A 59% Loss, Today
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The nature of investing is that you win some, and you lose some. And there's no doubt thatGreat Wall Pan Asia Holdings Limited(HKG:583) stock has had a really bad year. In that relatively short period, the share price has plunged 59%. Because Great Wall Pan Asia Holdings hasn't been listed for many years, the market is still learning about how the business performs. It's up 1.6% in the last seven days.
Check out our latest analysis for Great Wall Pan Asia Holdings
In his essayThe Superinvestors of Graham-and-DoddsvilleWarren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
Even though the Great Wall Pan Asia Holdings share price is down over the year, its EPS actually improved. It's quite possible that growth expectations may have been unreasonable in the past. The divergence between the EPS and the share price is quite notable, during the year. But we might find some different metrics explain the share price movements better.
Great Wall Pan Asia Holdings's revenue is actually up 247% over the last year. Since we can't easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
If you are thinking of buying or selling Great Wall Pan Asia Holdings stock, you should check out thisFREEdetailed report on its balance sheet.
Great Wall Pan Asia Holdings shareholders are down 59% for the year, even worse than the market loss of 10%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. With the stock down 6.0% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. You could get a better understanding of Great Wall Pan Asia Holdings's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Forget Facebook's Cryptocurrency Play Libra and Buy Square (SQ) Stock?
Square SQ stock is down roughly 3.5% over the last three months as investors decide what’s next for the once high-flying financial tech giant. The downturn can be blamed, in part, on Square’s subdued Q1 gross payment volume and lowered Q2 guidance. With that said, Square’s outlook appears especially strong amid growing uncertainty for tech stocks.
FB Crypto
Wall Street is abuzz with commentary about Facebook’s FB jump into the world of cryptocurrency. The social media giant had teased its plans for some time, but officially announced on Tuesday initial details of its blockchain-based payment system called Libra, which will be backed by hard assets.
Mark Zuckerberg’s firm said it partnered with the likes of Uber UBER and Spotify SPOT, as well as financial-services powers Mastercard MA and PayPal PYPL on Libra. Facebook’s move is part of a larger plan to diversify its business, which has become perhaps even more critical amid further speculation that U.S. government regulators could take action against FB, along with fellow tech powers Google GOOGL and maybe even Apple AAPL and Amazon AMZN.
Expanding Portfolio
There is no need to speculate about Facebook’s cryptocurrency plans any further at the moment, but it seems far from a surefire hit given FB’s recent user privacy woes. With that said, Square helped kickstart the fintech craze a decade ago with its first credit card processor and software aimed to help micro-businesses and entrepreneurs adapt in an ever-more cashless society.
Today, SQ, which is run by Twitter TWTR CEO Jack Dorsey, is a much more complete financial services firm. The San Francisco-based company’s portfolio includes debit cards, peer-to-peer payment options, business loans, and a robust set of business-focused payment and money management offerings.
SQ’s P2P payment platform, The Cash App, helps Square stands out against rivals like JP Morgan JPM and PayPal’s Venmo. The Cash App also allows users to buy and sell bitcoin. The firm has also expanded through acquisitions, including food delivery firm Caviar, which competes with Grubhub GRUB, as well as e-commerce-focused Shopify SHOP-rival Weebly.
Meanwhile, Square’s back-end, in-app payment infrastructure offerings have helped the firm expand. These have made the firm more attractive to bigger businesses. For example, 24% of its Q1 GPV came from “larger sellers,” who pulled in $500K in annualized GPV.
As we mentioned at the top, shares of SQ have slipped lately. Despite the recent downturn, Square stock is up 30% in 2019 and closed regular trading Wednesday up 1.17% to $72.66 per share—down roughly 28% from its 52-week intraday high of $101.15.
Outlook
Looking ahead, our current Zacks Consensus Estimate calls for the company’s second quarter fiscal 2019 revenue to jump 36.4% to $1.11 billion. This would mark a slowdown from Q1’s 43% top-line expansion, but still represents impressive growth amid what looks to be a downturn for tech stocks on average. Square’s full-year revenue is then projected to climb roughly 36% from $3.30 billion to $4.48 billion.
At the bottom end of the income statement, SQ’s adjusted Q2 EPS figure is projected to jump 23%. The company’s third-quarter earnings are expected to skyrocket 69%, with fiscal 2019 projected to soar 61% to reach $0.76 per share. Peaking further down the road, Square’s 2020 earnings are expected to surge 47% above our current year estimate, in a sign of strong bottom-line expansion.
Bottom Line
Square’s longer-term earnings estimate revision activity helps it earn a Zack Ranks #2 (Buy) at the moment. The firm also sports “B” grades for Growth and Momentum in our Style Scores system and looks to be a growth-focused tech stock for investors to consider buying on the dip.
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The Latest: Diesel fuel spilled in NV derailment; no hazmat
WELLS, Nev. (AP) — The Latest on a train derailment that closed U.S. Interstate 80 in northeast Nevada for more than an hour (all times local): 4:50 p.m. The Union Pacific Railroad says a small amount of diesel fuel was spilled along with some aluminum oxide when a train derailed in northeast Nevada but no hazardous materials were released. Spokeswoman Kristen South said Wednesday the train was carrying some military ammunition when approximately 23 cars derailed at about 10 a.m. in the high desert about 340 miles (550 kilometers) east of Reno. She says none of the cars that derailed carried hazardous material. No one was hurt. South says she doesn't know when the cleanup will be completed or the rail route will reopen along Interstate 80 connecting Reno to Salt Lake City. She says the cause of the derailment is under investigation. ___ 2:45 p.m. The Union Pacific Railroad says it is investigating the cause of the derailment of a freight train in northeast Nevada that briefly shut down Interstate 80 near the Utah line. Union Pacific spokeswoman Kristen South confirms military ammunition and hazardous materials were on the train that derailed at about 10 a.m. Wednesday in the high desert near the rural community of Wells about 340 miles (547 kilometers) east of Reno. But she says no ammunition or hazardous material was on any of the cars that derailed. She says Union Pacific is has begun cleanup but there's no immediate estimate on when rail traffic will resume on the line that runs along the interstate between Reno and Salt Lake City. No one was injured. I-80 was shut down for about an hour but reopened at about noon after emergency crews determined there was no danger. ___ 1:15 p.m. Authorities say cars carrying military munitions on a train headed west toward a Nevada Army depot were not among the cars that derailed near U.S. Interstate 80 not far from the Utah-Nevada state line. No injuries were reported following the derailment about 10 a.m. Wednesday about 3 miles (4.8 kilometers) east of the desert community of Wells. That's between Salt Lake City and Reno, Nevada. Story continues The interstate was closed for about an hour while emergency crews checked for possible spilled hazardous materials. It reopened shortly after noon. The Nevada Highway Patrol says nine flat cars, two tankers and three box cars derailed, and a plume of white aluminum oxide was released. The powder was described as a mild skin irritant skin irritant, but not a hazardous material. Elko County sheriff's officials say the Union Pacific Railroad confirmed vegetable oil also spilled. ____ 12:35 p.m. A 60-mile (96-kilometer) stretch of U.S. Interstate 80 in northeast Nevada has reopened after a train derailment caused a potential hazmat scare. The interstate was closed at about 11 a.m. Wednesday from Wells to West Wendover along the Utah state line while emergency crews checked for any potential spill of hazardous materials. It reopened shortly after noon. The Elko County Sheriff's office says Union Pacific officials have confirmed the material that spilled was vegetable oil. Union Pacific didn't immediately respond to requests for comment. There have been no reports of injuries. The sheriff's office says 22 rail cars were involved in the derailment. Authorities are continuing to investigate whether any hazardous materials were aboard the train. ___ 12 p.m. A 60-mile stretch (96 kilometers) of U.S. Interstate 80 in northeast Nevada has been closed while emergency crews respond to a train derailment. Authorities were investigating whether any hazardous materials were aboard the train. There's been no immediate report of injuries. Nevada Department of Transportation spokeswoman Meg Ragonese says the interstate was closed along the Utah state line shortly after the derailment was reported at about 11 a.m. Wednesday. A dispatcher at the Elko County Sheriff's Office says rail cars containing military munitions are on the train, but not near the site of the actual derailment. Ragonese says interstate traffic is being rerouted. |
Should Apollo Hospitals Enterprise Limited (NSE:APOLLOHOSP) Focus On Improving This Fundamental Metric?
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Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). By way of learning-by-doing, we'll look at ROE to gain a better understanding of Apollo Hospitals Enterprise Limited (NSE:APOLLOHOSP).
Our data showsApollo Hospitals Enterprise has a return on equity of 5.8%for the last year. One way to conceptualize this, is that for each ₹1 of shareholders' equity it has, the company made ₹0.058 in profit.
See our latest analysis for Apollo Hospitals Enterprise
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Apollo Hospitals Enterprise:
5.8% = ₹2.4b ÷ ₹35b (Based on the trailing twelve months to March 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is the capital paid in by shareholders, plus any retained earnings. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means ROE can be used to compare two businesses.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. If you look at the image below, you can see Apollo Hospitals Enterprise has a lower ROE than the average (8.5%) in the Healthcare industry classification.
That's not what we like to see. We prefer it when the ROE of a company is above the industry average, but it's not the be-all and end-all if it is lower. Nonetheless, it might be wise tocheck if insiders have been selling.
Virtually all companies need money to invest in the business, to grow profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
While Apollo Hospitals Enterprise does have some debt, with debt to equity of just 0.99, we wouldn't say debt is excessive. Its ROE is quite low, and the company already has some debt, so surely shareholders are hoping for an improvement. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is useful for comparing the quality of different businesses. In my book the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
Of courseApollo Hospitals Enterprise may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Will Corona Keep Constellation Brands Growing?
Beer is very important toConstellation Brands(NYSE: STZ). Its Corona and Modelo families of Mexican beer helped the segment account for 64% of the company's total sales and almost all of its operating income.
Mexican beeralso happens to be crucial to the current growth of the craft beer industry. Imported beer accounted for 20% of craft production in 2018, and Mexican beer represented over 72% of all imports. Constellation told investors last quarter that its beer portfolio was the primary growth contributor to the U.S. beer market last year and all of its imported brands achieved record sales volumes.
With Corona and Modelo an essential part of the future -- for the company and the industry -- let's look at the role they might play as Constellation prepares to report its first-quarter earnings at the end of the month.
Data from the market researchers at IRI give the combined Corona and Modelo brands a 61% share of import dollar sales and 60% of case sales. Modelo's dollar sales surged 18% higher last year, substantially better than the 11.6% increase in Corona sales, and more than twice the amount of the next closest brand, Constellation's Pacifico, at 8.4%.
The only imported beers not owned by Constellation that also showed any kind of growth last year wereDiageo's Guinness, which rose 0.9%, and MillerCoors Foster's, which was up 0.7%. Every other major brand family suffered declines in dollar sales, and only Corona, Modelo, and Pacifico saw case sales rise.
Yet that growth did not extend across the brand families. Corona Extra, for example, Constellation's flagship brand, saw sales fall 4% last year while losing 0.1% of market share. The beer distributor's second-biggest beer, Corona Light, tumbled 11.5%.
Constellation was more than able to make up for it with brand extensions like Corona Premier, a super-light beer targetingAnheuser-Busch InBev's (NYSE: BUD) perennial favorite Michelob Ultra, and Familiar, a beer targeted to Latino males that blew up with sales growing almost 140% last year.
But CEO Bill Newlands has told analysts that the line extensions cannibalize sales from existing labels, noting that the better they do, the more they have some impact on its other franchises.
Earlier this year, Constellation also began distributing Corona Refresca, another extension it took nationwide last month. It's a sparkling flavored malt beverage imported from Mexico that seeks tocapitalize on the popularityof hard seltzers like Truly fromBoston Beer(NYSE: SAM), which are also helping push craft beer sales higher.
While it's smart to use the Corona name to build up a broader portfolio that might otherwise succumb to brand fatigue, perhaps more worrisome are the reports of Constellation now discounting certain labels heading into the summer.
Corona has typically been positioned and priced as a premium beer above even Michelob Ultra, but industry site Beer Marketer's Insights reported the brewer was dropping the price on Corona Extra, Light, and Premier by about $2 a case, which would still allow it to be ranked above the likes of Budweiser and Bud Light, but would now be equal to or slightly below Michelob Ultra.
Constellation will also be putting more of its beer into cans, which better allows for taking it to parks, beaches, and other places where glass bottles are not permitted.
The price cuts, though, will eat into margins. Last year, Constellation saw operating margins slip to 39.3% despite better pricing because higher marketing and transportation costs offset the gains. Now, it won't have the pricing benefit to keep it aloft, and margins could react accordingly, though it may not show up in its first-quarter results.
Constellation Brands still has its wine and spirits business that it has positioned for premium leadership, though it is expecting the shipment volume increases it enjoyed last year to reverse in the first quarter. Having sold off its discount portfolio, it expects net sales and operating margins in wine and spirits to fall this year. Its investment in marijuana producerCronos Groupis another potential growth driver, but that is a long-term play.
That leaves beer to carry the load for Constellation, and though the Corona and Modelo families of brands are more than up to the task, there are individual nuances to be mindful of that may see this premium beer importer slip as the year progresses.
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Rich Dupreyhas no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Boston Beer. The Motley Fool recommends Anheuser-Busch InBev NV, Constellation Brands, and Diageo. The Motley Fool has adisclosure policy. |
Don't Sell Bharat Forge Limited (NSE:BHARATFORG) Before You Read This
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This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Bharat Forge Limited's (NSE:BHARATFORG), to help you decide if the stock is worth further research. Based on the last twelve months,Bharat Forge's P/E ratio is 19.82. That corresponds to an earnings yield of approximately 5.0%.
View our latest analysis for Bharat Forge
Theformula for P/Eis:
Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Or for Bharat Forge:
P/E of 19.82 = ₹439.35 ÷ ₹22.17 (Based on the year to March 2019.)
A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E.
Earnings growth rates have a big influence on P/E ratios. Earnings growth means that in the future the 'E' will be higher. And in that case, the P/E ratio itself will drop rather quickly. So while a stock may look expensive based on past earnings, it could be cheap based on future earnings.
Bharat Forge increased earnings per share by a whopping 35% last year. And earnings per share have improved by 14% annually, over the last five years. I'd therefore be a little surprised if its P/E ratio was not relatively high.
The P/E ratio indicates whether the market has higher or lower expectations of a company. As you can see below, Bharat Forge has a higher P/E than the average company (14.9) in the auto components industry.
That means that the market expects Bharat Forge will outperform other companies in its industry. Shareholders are clearly optimistic, but the future is always uncertain. So investors should delve deeper. I like to checkif company insiders have been buying or selling.
The 'Price' in P/E reflects the market capitalization of the company. In other words, it does not consider any debt or cash that the company may have on the balance sheet. Hypothetically, a company could reduce its future P/E ratio by spending its cash (or taking on debt) to achieve higher earnings.
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
Bharat Forge has net debt worth 15% of its market capitalization. That's enough debt to impact the P/E ratio a little; so keep it in mind if you're comparing it to companies without debt.
Bharat Forge trades on a P/E ratio of 19.8, which is above the IN market average of 15.7. While the company does use modest debt, its recent earnings growth is superb. So on this analysis a high P/E ratio seems reasonable.
Investors have an opportunity when market expectations about a stock are wrong. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock.
But note:Bharat Forge may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20).
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Slack direct listing — What to know in markets Thursday
Slack will finally make its public debut Thursday morning on the New York Stock Exchange (NYSE) under the ticker “WORK.”
On Wednesday evening, theNYSE set a reference price of $26 per share.
Instead of the traditional initial public offering (IPO) route, Slack has opted for a direct listing. A direct listing helps companies avoid hefty underwriting fees and a lengthy roadshow process. However, that also means the companies are also passing on an opportunity to raise capital ahead of their debut.
Slack’s direct listing is the first since Spotify’s successful debut last year. According to the New York Stock Exchange, Spotify was the fifth largest opening trade on record in the U.S. Thus, investors will be paying close attention to how Slack’s debut goes Thursday morning.
Much like its recent IPO peers, Slack is not yet a profitable company. For the three months ended April 30, thecompany reported revenueof $134.8 million, up from $80.9 million last year. However, net losses increased to $31.9 million, from $24.9 million last year.
Slack currently boasts about 10 million daily active users (DAU) worldwide, and according to the company, more than half of the DAUs are international.
[Read more:Don’t say ‘IPO’: What to know about Slack’s direct listing]
Meanwhile, on the corporate earnings front, Darden Restaurants (DRI) and Kroger (KR) will report ahead of the opening bell, while Canopy Growth (CGC) and Red Hat (RHT) will report after the market close.
—
Heidi Chung is a reporter at Yahoo Finance. Follow her on Twitter:@heidi_chung.
Follow Yahoo Finance onTwitter,Facebook,Instagram,Flipboard,LinkedIn, andreddit.
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Like Its Stock Price, Ford Motor Company's Quality Is Up in 2019
At least by one important measure, Ford Motor Company (NYSE: F) is still Detroit's quality king. For the third year in a row, the Blue Oval beat all of its domestic -- and Japanese -- rivals in a key measure of quality, the J.D. Power Initial Quality Study. The study, released on Wednesday, ranks Ford just behind Korean automaker Hyundai and its corporate cousin Kia among mainstream automakers -- and ahead of all of its Detroit, Japanese, and German rivals. That's good news for Ford (and Ford investors) for a few reasons. Let's take a closer look. A white 2019 Ford Fusion, a midsize sedan. Ford's Fusion got high marks for initial quality in this year's edition of the J.D. Power survey. Image source: Ford Motor Company. What the Initial Quality Study is -- and isn't The J.D. Power Initial Quality Study, or IQS, is a survey that asks participants to report problems with new vehicles that occurred in the first 90 days of ownership. It's distinct from the other important J.D. Power automotive-quality study, the Vehicle Dependability Study (VDS), which asks about problems in the third year of a vehicle's life. The 2019 edition of the IQS covers almost every auto brand sold in the United States, 32 brands total. The few exceptions include low-volume luxury brands like Ferrari and Aston Martin , as well as Tesla , which has bucked industry practice by choosing not to make its customer registration data available to J.D. Power. IQS results are reported by brand, as you'll see in the chart below. There are also special mentions for the top-performing models in major vehicle segments. (Ford had a surprising win in one segment -- more on that in a bit.) Long story short, the IQS gives us a look at how well an automaker's vehicles are assembled. Together with the VDS, which tells us something about how well vehicles hold up over time, we can get a pretty good idea of how each brand is faring on "quality." Got it? Let's take a look at this year's results. Story continues The 2019 Initial Quality Study rankings The chart below, supplied by J.D. Power, shows how each auto brand performed. The score shown is the average number of problems reported per 100 vehicles. Lower scores mean fewer problems. A J.D. Power image showing how auto brands ranked in the 2019 IQS. Ford and Lincoln ranked fourth and fifth, respectively, behind Genesis, Kia, and Hyundai. Image source: J.D. Power. Ford also won two of the segment awards. Its Fusion tied General Motors ' (NYSE: GM) Chevrolet Malibu for the top score in the midsize car segment, while its new-for-2019 Ranger led the midsize pickup segment. (The Ranger's win is a surprise: Because assembly quality tends to improve over a given model's lifetime, as the factory works to perfect its procedures, new models often fare relatively poorly in the IQS.) Hyundai, GM, and BMW AG led the model-level awards with six, five, and three, respectively. Nissan also received two. A blue 2019 Ford Ranger, a midsize pickup, is shown in a forest setting. There are two kayaks loaded on a rack in the Ranger's bed. Ford's new Ranger pickup topped the midsize-pickup rankings in this year's Initial Quality Study. Image source: Ford Motor Company. Ford's quality is still going in the right direction As you can see, while there's still a gap between Ford and the Korean brands -- Hyundai, its luxury brand Genesis, and Kia -- Ford and its luxury brand Lincoln are the "best of the rest" right now. This is the third year in a row in which the Ford brand has outpaced all of its Japanese and American rivals, but it's the first time that Ford has managed to beat all of the German brands as well. ( Volkswagen subsidiary Porsche has long been a fixture at or near the top of the IQS, but it fell to below average in 2019.) Here's how Ford's result -- fourth place with 83 problems per 100 vehicles -- compares with its results over the last several years: Fifth with 81 problems per 100 vehicles in 2018; Fourth with 86 problems per 100 vehicles in 2017; 11th with 102 problems per 100 vehicles in 2016; 12th with 107 problems per 100 vehicles in 2015; 16th with 116 problems per 100 vehicles in 2014; 27th with 131 problems per 100 vehicles in 2013; 27th with 118 problems per 100 vehicles in 2012. Clearly, the trend has been going in the right direction for Ford for several years now. For several years before 2017, Ford was hit hard in the IQS by issues with its MyFord Touch touchscreen system , which was poorly designed and buggy. But its successor, SYNC 3, which Ford began rolling out for the 2017 model year, has proven to be much more reliable and easier to use . But why did Ford (and several other brands) have more problems per 100 vehicles in 2019 than in 2018? J.D. Power doesn't release brand-by-brand details. But Dave Sargent, the company's vice president of global automotive, said that the latest high-tech driver-assistance aids were more frequently cited as trouble spots in this year's survey responses. Ford, like other automakers, has been adding advanced driver-assist systems to more and more models -- not only to improve safety, but to help pave the way to fully self-driving vehicles. Why this matters for Ford investors The Detroit automakers, including Ford, have long been seen by consumers as lagging import-brand rivals in quality. That has held back sales of new vehicles to some extent, and it has also had an impact on "residual values," the values of leased vehicles at the end of their leases. Vehicles that rate highly on measures of reliability tend to earn higher residual values because they're more in demand as used cars. That's a competitive advantage: Higher residual values allow an automaker to offer more attractive lease terms to new-vehicle shoppers, to generate more profit from captive-finance subsidiaries (like Ford's subsidiary Ford Credit) that underwrite leases, or both. While Ford would surely like to beat its Korean rivals one of these years, it's doing what it needs to do to stay a bit ahead of its other competitors on this key measure of quality. That's not big news, but it is good news for Ford investors. More From The Motley Fool 10 Best Stocks to Buy Today The $16,728 Social Security Bonus You Cannot Afford to Miss 20 of the Top Stocks to Buy (Including the Two Every Investor Should Own) What Is an ETF? 5 Recession-Proof Stocks How to Beat the Market John Rosevear owns shares of Ford and General Motors. The Motley Fool owns shares of and recommends Tesla. The Motley Fool recommends BMW. The Motley Fool has a disclosure policy . |
Los Angeles' homeless crisis reaching third world country levels, local residents say
The homeless crisis in Los Angeles is reaching a boiling point with 36,000 homeless people, a 16 percent increase over the last year, according to a population count released last week.
L.A. residents are frustrated with Mayor Eric Garcetti and claim his inactions and failed leadership has led to people living in third world conditions.“It is time, Eric Garcetti, that you accept your failure and that you step down,” Leading Recall Effort’s Alexandria Datig said from the steps of City Hall on Wednesday. “We demand that you step down before the citizens of Los Angeles recall you.”
Garcetti held his own press conference on Wednesday, too, announcing new plans to deploy sanitation teams in the city to clean the streets and address homeless encampments. He admitted the city needs to do more to combat homelessness.
“Homelessness is a massive emergency in our city. It's a crisis unlike anything we've seen before,” Garcetti said. "A human-caused problem, no matter how many decades in the making, can be a human-solved problem as well.”
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Nonprofit organizations and businesses are working to tackle the homelessness and displacement.Googlerecently announced it will invest $1 billion to ease the high cost of housing in the San Francisco Bay Area.Salesforce founder and co-CEO Marc Benioffhas also been a leading advocate for pushing a homeless tax measure to solve the homeless crisis in San Francisco. The Proposition C initiative, which imposes a corporate tax on businesses with over $50 million in revenue to fund the city’s homeless facilities and services, passed in November 2018.
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Did Hedge Funds Drop The Ball On Cypress Semiconductor Corporation (CY) ?
Is Cypress Semiconductor Corporation (NASDAQ:CY) a good investment right now? We check hedge fund and billionaire investor sentiment before delving into hours of research. Hedge funds spend millions of dollars on Ivy League graduates, expert networks, and get tips from investment bankers and industry insiders. Sure they sometimes fail miserably, but their consensus stock picks historically outperformed the market after adjusting for known risk factors.
IsCypress Semiconductor Corporation (NASDAQ:CY)a buy, sell, or hold? Money managers are becoming more confident. The number of bullish hedge fund bets went up by 2 lately. Our calculations also showed that cy isn't among the30 most popular stocks among hedge funds.
To the average investor there are many methods stock traders employ to value stocks. A duo of the most under-the-radar methods are hedge fund and insider trading moves. We have shown that, historically, those who follow the top picks of the elite fund managers can outpace their index-focused peers by a superb amount (see the details here).
Let's take a look at the key hedge fund action surrounding Cypress Semiconductor Corporation (NASDAQ:CY).
At the end of the first quarter, a total of 25 of the hedge funds tracked by Insider Monkey were long this stock, a change of 9% from the previous quarter. The graph below displays the number of hedge funds with bullish position in CY over the last 15 quarters. With hedge funds' sentiment swirling, there exists an "upper tier" of notable hedge fund managers who were adding to their holdings significantly (or already accumulated large positions).
More specifically,Renaissance Technologieswas the largest shareholder of Cypress Semiconductor Corporation (NASDAQ:CY), with a stake worth $32.2 million reported as of the end of March. Trailing Renaissance Technologies was AQR Capital Management, which amassed a stake valued at $31.4 million. Alyeska Investment Group, Millennium Management, and GAMCO Investors were also very fond of the stock, giving the stock large weights in their portfolios.
As one would reasonably expect, key money managers were leading the bulls' herd.Marshall Wace LLP, managed by Paul Marshall and Ian Wace, initiated the largest position in Cypress Semiconductor Corporation (NASDAQ:CY). Marshall Wace LLP had $12.1 million invested in the company at the end of the quarter. Howard Marks'sOaktree Capital Managementalso initiated a $7.3 million position during the quarter. The other funds with brand new CY positions are Daryl Smith'sKayak Investment Partners, Tor Minesuk'sMondrian Capital, and Ian Simm'sImpax Asset Management.
Let's now review hedge fund activity in other stocks similar to Cypress Semiconductor Corporation (NASDAQ:CY). These stocks are The New York Times Company (NYSE:NYT), New York Community Bancorp, Inc. (NYSE:NYCB), AngloGold Ashanti Limited (NYSE:AU), and Watsco Inc (NYSE:WSO). All of these stocks' market caps resemble CY's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NYT,32,1168693,0 NYCB,12,86969,-3 AU,23,356908,11 WSO,18,137568,4 Average,21.25,437535,3 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 21.25 hedge funds with bullish positions and the average amount invested in these stocks was $438 million. That figure was $225 million in CY's case. The New York Times Company (NYSE:NYT) is the most popular stock in this table. On the other hand New York Community Bancorp, Inc. (NYSE:NYCB) is the least popular one with only 12 bullish hedge fund positions. Cypress Semiconductor Corporation (NASDAQ:CY) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on CY as the stock returned 19.9% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Concho Resources Inc. (CXO)
After several tireless days we have finished crunching the numbers from nearly 750 13F filings issued by the elite hedge funds and other investment firms that we track at Insider Monkey, which disclosed those firms' equity portfolios as of March 31. The results of that effort will be put on display in this article, as we share valuable insight into the smart money sentiment towards Concho Resources Inc. (NYSE:CXO).
IsConcho Resources Inc. (NYSE:CXO)a buy, sell, or hold? Hedge funds are turning less bullish. The number of long hedge fund bets were trimmed by 9 lately. Our calculations also showed that CXO isn't among the30 most popular stocks among hedge funds.CXOwas in 26 hedge funds' portfolios at the end of the first quarter of 2019. There were 35 hedge funds in our database with CXO holdings at the end of the previous quarter.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let's review the key hedge fund action surrounding Concho Resources Inc. (NYSE:CXO).
Heading into the second quarter of 2019, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of -26% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CXO over the last 15 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically,Citadel Investment Groupwas the largest shareholder of Concho Resources Inc. (NYSE:CXO), with a stake worth $269.3 million reported as of the end of March. Trailing Citadel Investment Group was Point72 Asset Management, which amassed a stake valued at $73.1 million. Alyeska Investment Group, Adage Capital Management, and Citadel Investment Group were also very fond of the stock, giving the stock large weights in their portfolios.
Because Concho Resources Inc. (NYSE:CXO) has witnessed bearish sentiment from the smart money, it's safe to say that there exists a select few funds that slashed their full holdings last quarter. Interestingly, Daniel Arbess'sPerella Weinberg Partnerscut the largest stake of the 700 funds watched by Insider Monkey, totaling about $28.1 million in stock, and Todd J. Kantor's Encompass Capital Advisors was right behind this move, as the fund sold off about $20.6 million worth. These bearish behaviors are intriguing to say the least, as aggregate hedge fund interest fell by 9 funds last quarter.
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Concho Resources Inc. (NYSE:CXO) but similarly valued. These stocks are TELUS Corporation (NYSE:TU), Parker-Hannifin Corporation (NYSE:PH), FirstEnergy Corp. (NYSE:FE), and Centene Corp (NYSE:CNC). This group of stocks' market valuations match CXO's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TU,13,336110,2 PH,28,516590,-2 FE,41,3727862,2 CNC,58,2067914,2 Average,35,1662119,1 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 35 hedge funds with bullish positions and the average amount invested in these stocks was $1662 million. That figure was $531 million in CXO's case. Centene Corp (NYSE:CNC) is the most popular stock in this table. On the other hand TELUS Corporation (NYSE:TU) is the least popular one with only 13 bullish hedge fund positions. Concho Resources Inc. (NYSE:CXO) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately CXO wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); CXO investors were disappointed as the stock returned -11.5% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Is CIT Group Inc. (CIT) A Good Stock To Buy?
Our extensive research has shown that imitating the smart money can generate significant returns for retail investors, which is why we track nearly 750 active prominent money managers and analyze their quarterly 13F filings. The stocks that are heavily bought by hedge funds historically outperformed the market, though there is no shortage of high profile failures like hedge funds' 2018 losses in Facebook and Apple. Let’s take a closer look at what the funds we track think about CIT Group Inc. (NYSE:CIT) in this article.
CIT Group Inc. (NYSE:CIT)was in 25 hedge funds' portfolios at the end of the first quarter of 2019. CIT investors should pay attention to a decrease in hedge fund sentiment of late. There were 26 hedge funds in our database with CIT holdings at the end of the previous quarter. Our calculations also showed that cit isn't among the30 most popular stocks among hedge funds.
To the average investor there are plenty of metrics stock market investors have at their disposal to appraise publicly traded companies. A couple of the less known metrics are hedge fund and insider trading sentiment. We have shown that, historically, those who follow the top picks of the top investment managers can outclass the market by a significant amount (see the details here).
We're going to review the latest hedge fund action encompassing CIT Group Inc. (NYSE:CIT).
At Q1's end, a total of 25 of the hedge funds tracked by Insider Monkey were long this stock, a change of -4% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards CIT over the last 15 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically,First Pacific Advisors LLCwas the largest shareholder of CIT Group Inc. (NYSE:CIT), with a stake worth $445.6 million reported as of the end of March. Trailing First Pacific Advisors LLC was Lakewood Capital Management, which amassed a stake valued at $127.1 million. Renaissance Technologies, MFP Investors, and Owl Creek Asset Management were also very fond of the stock, giving the stock large weights in their portfolios.
Seeing as CIT Group Inc. (NYSE:CIT) has witnessed declining sentiment from hedge fund managers, it's easy to see that there were a few hedge funds that decided to sell off their entire stakes heading into Q3. Interestingly, Israel Englander'sMillennium Managementdropped the largest investment of all the hedgies watched by Insider Monkey, comprising close to $16.7 million in stock. Matthew Lindenbaum's fund,Basswood Capital, also cut its stock, about $8 million worth. These moves are intriguing to say the least, as total hedge fund interest fell by 1 funds heading into Q3.
Let's now take a look at hedge fund activity in other stocks similar to CIT Group Inc. (NYSE:CIT). These stocks are ADT Inc (NYSE:ADT), Nuance Communications Inc. (NASDAQ:NUAN), Prosperity Bancshares, Inc. (NYSE:PB), and 51job, Inc. (NASDAQ:JOBS). All of these stocks' market caps match CIT's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ADT,16,85421,1 NUAN,28,459833,-7 PB,9,103636,0 JOBS,12,29384,-1 Average,16.25,169569,-1.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 16.25 hedge funds with bullish positions and the average amount invested in these stocks was $170 million. That figure was $774 million in CIT's case. Nuance Communications Inc. (NASDAQ:NUAN) is the most popular stock in this table. On the other hand Prosperity Bancshares, Inc. (NYSE:PB) is the least popular one with only 9 bullish hedge fund positions. CIT Group Inc. (NYSE:CIT) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on CIT as the stock returned 3.1% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Sanofi (SNY)
The first quarter was a breeze as Powell pivoted, and China seemed eager to reach a deal with Trump. Both the S&P 500 and Russell 2000 delivered very strong gains as a result, with the Russell 2000, which is composed of smaller companies, outperforming the large-cap stocks slightly during the first quarter. Unfortunately sentiment shifted in May as this time China pivoted and Trump put more pressure on China by increasing tariffs. Hedge funds' top 20 stock picks performed spectacularly in this volatile environment. These stocks delivered a total gain of 18.7% through May 30th, vs. a gain of 12.1% for the S&P 500 ETF. In this article we will look at how this market volatility affected the sentiment of hedge funds towards Sanofi (NASDAQ:SNY), and what that likely means for the prospects of the company and its stock.
Sanofi (NASDAQ:SNY)was in 26 hedge funds' portfolios at the end of the first quarter of 2019. SNY has seen an increase in hedge fund sentiment lately. There were 23 hedge funds in our database with SNY holdings at the end of the previous quarter. Our calculations also showed that SNY isn't among the30 most popular stocks among hedge funds.
To the average investor there are several metrics investors employ to assess their holdings. A duo of the most under-the-radar metrics are hedge fund and insider trading interest. Our experts have shown that, historically, those who follow the top picks of the elite money managers can outperform the market by a solid margin (see the details here).
Let's check out the recent hedge fund action regarding Sanofi (NASDAQ:SNY).
At the end of the first quarter, a total of 26 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 13% from the previous quarter. The graph below displays the number of hedge funds with bullish position in SNY over the last 15 quarters. With hedgies' capital changing hands, there exists an "upper tier" of key hedge fund managers who were increasing their holdings considerably (or already accumulated large positions).
The largest stake in Sanofi (NASDAQ:SNY) was held byFisher Asset Management, which reported holding $696.3 million worth of stock at the end of March. It was followed by Arrowstreet Capital with a $44.3 million position. Other investors bullish on the company included Point72 Asset Management, Eversept Partners, and Balyasny Asset Management.
As one would reasonably expect, key hedge funds were breaking ground themselves.Balyasny Asset Management, managed by Dmitry Balyasny, initiated the largest call position in Sanofi (NASDAQ:SNY). Balyasny Asset Management had $12 million invested in the company at the end of the quarter. Krishen Sud'sSivik Global Healthcarealso initiated a $5.8 million position during the quarter. The following funds were also among the new SNY investors: John Bader'sHalcyon Asset Management, Michael Gelband'sExodusPoint Capital, and Michael Platt and William Reeves'sBlueCrest Capital Mgmt..
Let's now take a look at hedge fund activity in other stocks similar to Sanofi (NASDAQ:SNY). These stocks are Thermo Fisher Scientific Inc. (NYSE:TMO), NVIDIA Corporation (NASDAQ:NVDA), Royal Bank of Canada (NYSE:RY), and Altria Group Inc (NYSE:MO). This group of stocks' market caps are closest to SNY's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position TMO,68,4435544,1 NVDA,43,1595434,2 RY,17,552491,3 MO,36,823787,-5 Average,41,1851814,0.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 41 hedge funds with bullish positions and the average amount invested in these stocks was $1852 million. That figure was $860 million in SNY's case. Thermo Fisher Scientific Inc. (NYSE:TMO) is the most popular stock in this table. On the other hand Royal Bank of Canada (NYSE:RY) is the least popular one with only 17 bullish hedge fund positions. Sanofi (NASDAQ:SNY) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately SNY wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); SNY investors were disappointed as the stock returned -4% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Hedge Funds Have Never Been This Bullish On Duke Energy Corporation (DUK)
Is Duke Energy Corporation (NYSE:DUK) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It's not surprising given that hedge funds have access to better information and more resources to predict the winners in the stock market.
IsDuke Energy Corporation (NYSE:DUK)a first-rate investment now? Money managers are in an optimistic mood. The number of long hedge fund positions improved by 9 recently. Our calculations also showed that DUK isn't among the30 most popular stocks among hedge funds.DUKwas in 26 hedge funds' portfolios at the end of March. There were 17 hedge funds in our database with DUK positions at the end of the previous quarter.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
[caption id="attachment_30621" align="aligncenter" width="487"]
Cliff Asness of AQR Capital Management[/caption]
Let's view the latest hedge fund action encompassing Duke Energy Corporation (NYSE:DUK).
Heading into the second quarter of 2019, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of 53% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards DUK over the last 15 quarters. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Of the funds tracked by Insider Monkey,Renaissance Technologies, managed by Jim Simons, holds the most valuable position in Duke Energy Corporation (NYSE:DUK). Renaissance Technologies has a $734.1 million position in the stock, comprising 0.7% of its 13F portfolio. The second largest stake is held by Ken Griffin ofCitadel Investment Group, with a $83.6 million position; less than 0.1%% of its 13F portfolio is allocated to the company. Other hedge funds and institutional investors with similar optimism comprise Cliff Asness'sAQR Capital Management, Israel Englander'sMillennium Managementand D. E. Shaw'sD E Shaw.
Now, key hedge funds were leading the bulls' herd.Millennium Management, managed by Israel Englander, assembled the most valuable position in Duke Energy Corporation (NYSE:DUK). Millennium Management had $60.2 million invested in the company at the end of the quarter. Matthew Tewksbury'sStevens Capital Managementalso initiated a $25.1 million position during the quarter. The following funds were also among the new DUK investors: Greg Poole'sEcho Street Capital Management, D. E. Shaw'sD E Shaw, and Alec Litowitz and Ross Laser'sMagnetar Capital.
Let's go over hedge fund activity in other stocks similar to Duke Energy Corporation (NYSE:DUK). These stocks are The Bank of Nova Scotia (NYSE:BNS), Canadian National Railway Company (NYSE:CNI), Chubb Limited (NYSE:CB), and Eni SpA (NYSE:E). This group of stocks' market values resemble DUK's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position BNS,14,518832,0 CNI,17,2175473,-7 CB,23,466816,-1 E,9,99142,2 Average,15.75,815066,-1.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 15.75 hedge funds with bullish positions and the average amount invested in these stocks was $815 million. That figure was $1114 million in DUK's case. Chubb Limited (NYSE:CB) is the most popular stock in this table. On the other hand Eni SpA (NYSE:E) is the least popular one with only 9 bullish hedge fund positions. Compared to these stocks Duke Energy Corporation (NYSE:DUK) is more popular among hedge funds. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately DUK wasn't nearly as popular as these 20 stocks and hedge funds that were betting on DUK were disappointed as the stock returned -3.9% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Westlake Chemical Corporation (WLK)
Hedge funds and other investment firms that we track manage billions of dollars of their wealthy clients' money, and needless to say, they are painstakingly thorough when analyzing where to invest this money, as their own wealth also depends on it. Regardless of the various methods used by elite investors like David Tepper and David Abrams, the resources they expend are second-to-none. This is especially valuable when it comes to small-cap stocks, which is where they generate their strongest outperformance, as their resources give them a huge edge when it comes to studying these stocks compared to the average investor, which is why we intently follow their activity in the small-cap space.
IsWestlake Chemical Corporation (NYSE:WLK)undervalued? Investors who are in the know are betting on the stock. The number of long hedge fund positions inched up by 2 recently. Our calculations also showed that WLK isn't among the30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Let's take a peek at the latest hedge fund action regarding Westlake Chemical Corporation (NYSE:WLK).
At Q1's end, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of 8% from the previous quarter. By comparison, 32 hedge funds held shares or bullish call options in WLK a year ago. With hedge funds' sentiment swirling, there exists a few key hedge fund managers who were adding to their holdings meaningfully (or already accumulated large positions).
The largest stake in Westlake Chemical Corporation (NYSE:WLK) was held byMillennium Management, which reported holding $73.1 million worth of stock at the end of March. It was followed by Holocene Advisors with a $59 million position. Other investors bullish on the company included Citadel Investment Group, AQR Capital Management, and Point72 Asset Management.
As industrywide interest jumped, key money managers were breaking ground themselves.Holocene Advisors, managed by Brandon Haley, assembled the biggest position in Westlake Chemical Corporation (NYSE:WLK). Holocene Advisors had $59 million invested in the company at the end of the quarter. Steve Cohen'sPoint72 Asset Managementalso made a $29.8 million investment in the stock during the quarter. The other funds with new positions in the stock are Zach Schreiber'sPoint State Capital, Nick Niell'sArrowgrass Capital Partners, and Ray Dalio'sBridgewater Associates.
Let's go over hedge fund activity in other stocks similar to Westlake Chemical Corporation (NYSE:WLK). We will take a look at Cognex Corporation (NASDAQ:CGNX), Snap-on Incorporated (NYSE:SNA), Albemarle Corporation (NYSE:ALB), and Grupo Aval Acciones y Valores S.A. (NYSE:AVAL). This group of stocks' market valuations are closest to WLK's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position CGNX,13,230572,0 SNA,25,498590,0 ALB,25,186420,-3 AVAL,8,15040,-1 Average,17.75,232656,-1 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 17.75 hedge funds with bullish positions and the average amount invested in these stocks was $233 million. That figure was $365 million in WLK's case. Snap-on Incorporated (NYSE:SNA) is the most popular stock in this table. On the other hand Grupo Aval Acciones y Valores S.A. (NYSE:AVAL) is the least popular one with only 8 bullish hedge fund positions. Compared to these stocks Westlake Chemical Corporation (NYSE:WLK) is more popular among hedge funds. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately WLK wasn't nearly as popular as these 20 stocks and hedge funds that were betting on WLK were disappointed as the stock returned -12.8% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Nordstrom, Inc. (JWN)
It is already common knowledge that individual investors do not usually have the necessary resources and abilities to properly research an investment opportunity. As a result, most investors pick their illusory “winners” by making a superficial analysis and research that leads to poor performance on aggregate. Since stock returns aren't usually symmetrically distributed and index returns are more affected by a few outlier stocks (i.e. the FAANG stocks dominating and driving S&P 500 Index's returns in recent years), more than 50% of the constituents of the Standard and Poor’s 500 Index underperform the benchmark. Hence, if you randomly pick a stock, there is more than 50% chance that you'd fail to beat the market. At the same time, the 20 most favored S&P 500 stocks by the hedge funds monitored by Insider Monkey generated an outperformance of 6 percentage points during the first 5 months of 2019. Of course, hedge funds do make wrong bets on some occasions and these get disproportionately publicized on financial media, but piggybacking their moves can beat the broader market on average. That's why we are going to go over recent hedge fund activity in Nordstrom, Inc. (NYSE:JWN).
Nordstrom, Inc. (NYSE:JWN)has seen an increase in enthusiasm from smart money in recent months.JWNwas in 26 hedge funds' portfolios at the end of March. There were 23 hedge funds in our database with JWN holdings at the end of the previous quarter. Our calculations also showed that jwn isn't among the30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We're going to take a look at the latest hedge fund action surrounding Nordstrom, Inc. (NYSE:JWN).
At Q1's end, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of 13% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in JWN over the last 15 quarters. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Nordstrom, Inc. (NYSE:JWN) was held byRenaissance Technologies, which reported holding $57.9 million worth of stock at the end of March. It was followed by D E Shaw with a $47 million position. Other investors bullish on the company included Two Sigma Advisors, Millennium Management, and Ariel Investments.
As industrywide interest jumped, specific money managers have jumped into Nordstrom, Inc. (NYSE:JWN) headfirst.Renaissance Technologies, managed by Jim Simons, established the most outsized position in Nordstrom, Inc. (NYSE:JWN). Renaissance Technologies had $57.9 million invested in the company at the end of the quarter. Matthew Tewksbury'sStevens Capital Managementalso made a $5.1 million investment in the stock during the quarter. The other funds with new positions in the stock are Anand Parekh'sAlyeska Investment Group, Jeffrey Talpins'sElement Capital Management, and Andrew Feldstein and Stephen Siderow'sBlue Mountain Capital.
Let's check out hedge fund activity in other stocks - not necessarily in the same industry as Nordstrom, Inc. (NYSE:JWN) but similarly valued. These stocks are Nutanix, Inc. (NASDAQ:NTNX), Foot Locker, Inc. (NYSE:FL), KAR Auction Services Inc (NYSE:KAR), and YY Inc (NASDAQ:YY). This group of stocks' market valuations match JWN's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NTNX,36,456099,-1 FL,35,956263,0 KAR,42,1234048,8 YY,20,129700,-4 Average,33.25,694028,0.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 33.25 hedge funds with bullish positions and the average amount invested in these stocks was $694 million. That figure was $283 million in JWN's case. KAR Auction Services Inc (NYSE:KAR) is the most popular stock in this table. On the other hand YY Inc (NASDAQ:YY) is the least popular one with only 20 bullish hedge fund positions. Nordstrom, Inc. (NYSE:JWN) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately JWN wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); JWN investors were disappointed as the stock returned -26.8% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Hedge Funds Have Never Been This Bullish On Amarin Corporation plc (AMRN)
"Since 2006, value stocks (IVE vs IVW) have underperformed 11 of the 13 calendar years and when they beat growth, it wasn't by much. Cumulatively, through this week, it has been a 122% differential (up 52% for value vs up 174% for growth). This appears to be the longest and most severe drought for value investors since data collection began. It will go our way eventually as there are too many people paying far too much for today's darlings, both public and private. Further, the ten-year yield of 2.5% (pre-tax) isn't attractive nor is real estate. We believe the value part of the global equity market is the only place to earn solid risk adjusted returns and we believe those returns will be higher than normal," said Vilas Fund in itsQ1 investor letter. We aren't sure whether value stocks outperform growth, but we follow hedge fund investor letters to understand where the markets and stocks might be going. This article will lay out and discuss the hedge fund and institutional investor sentiment towards Amarin Corporation plc (NASDAQ:AMRN).
Amarin Corporation plc (NASDAQ:AMRN)was in 26 hedge funds' portfolios at the end of March. AMRN has experienced an increase in enthusiasm from smart money lately. There were 24 hedge funds in our database with AMRN holdings at the end of the previous quarter. Our calculations also showed that amrn isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to review the recent hedge fund action surrounding Amarin Corporation plc (NASDAQ:AMRN).
At the end of the first quarter, a total of 26 of the hedge funds tracked by Insider Monkey were long this stock, a change of 8% from one quarter earlier. The graph below displays the number of hedge funds with bullish position in AMRN over the last 15 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds,Baker Bros. Advisorsheld the most valuable stake in Amarin Corporation plc (NASDAQ:AMRN), which was worth $897 million at the end of the first quarter. On the second spot was Consonance Capital Management which amassed $228.2 million worth of shares. Moreover, venBio Select Advisor, Perceptive Advisors, and Rock Springs Capital Management were also bullish on Amarin Corporation plc (NASDAQ:AMRN), allocating a large percentage of their portfolios to this stock.
Consequently, key hedge funds have jumped into Amarin Corporation plc (NASDAQ:AMRN) headfirst.Polar Capital, managed by Brian Ashford-Russell and Tim Woolley, established the most outsized position in Amarin Corporation plc (NASDAQ:AMRN). Polar Capital had $9.3 million invested in the company at the end of the quarter. Samuel Isaly'sOrbiMed Advisorsalso made a $7.3 million investment in the stock during the quarter. The other funds with new positions in the stock are Benjamin A. Smith'sLaurion Capital Management, Clint Carlson'sCarlson Capital, and Ori Hershkovitz'sNexthera Capital.
Let's now take a look at hedge fund activity in other stocks similar to Amarin Corporation plc (NASDAQ:AMRN). We will take a look at Moderna, Inc. (NASDAQ:MRNA), Zayo Group Holdings Inc (NYSE:ZAYO), Genpact Limited (NYSE:G), and AerCap Holdings N.V. (NYSE:AER). This group of stocks' market valuations are closest to AMRN's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position MRNA,15,492608,-2 ZAYO,61,1681079,5 G,29,600991,7 AER,23,792415,-8 Average,32,891773,0.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 32 hedge funds with bullish positions and the average amount invested in these stocks was $892 million. That figure was $1959 million in AMRN's case. Zayo Group Holdings Inc (NYSE:ZAYO) is the most popular stock in this table. On the other hand Moderna, Inc. (NASDAQ:MRNA) is the least popular one with only 15 bullish hedge fund positions. Amarin Corporation plc (NASDAQ:AMRN) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately AMRN wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); AMRN investors were disappointed as the stock returned -12% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About XPO Logistics Inc (XPO)
Is XPO Logistics Inc (NYSE:XPO) a good equity to bet on right now? We like to check what the smart money thinks first before doing extensive research. Although there have been several high profile failed hedge fund picks, the consensus picks among hedge fund investors have historically outperformed the market after adjusting for known risk attributes. It's not surprising given that hedge funds have access to better information and more resources to predict the winners in the stock market.
XPO Logistics Inc (NYSE:XPO)investors should be aware of a decrease in activity from the world's largest hedge funds in recent months. Our calculations also showed that xpo isn't among the30 most popular stocks among hedge funds.
In the financial world there are a large number of tools investors have at their disposal to grade stocks. A pair of the most under-the-radar tools are hedge fund and insider trading indicators. We have shown that, historically, those who follow the top picks of the best fund managers can outperform the broader indices by a solid amount. Insider Monkey's flagship best performing hedge funds strategy returned 25.8% year to date (through May 30th) and outperformed the market even though it draws its stock picks among small-cap stocks. This strategy also outperformed the market by 40 percentage points since its inception (see the details here). That's why we believe hedge fund sentiment is a useful indicator that investors should pay attention to.
We're going to take a glance at the new hedge fund action regarding XPO Logistics Inc (NYSE:XPO).
At the end of the first quarter, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -41% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards XPO over the last 15 quarters. With the smart money's capital changing hands, there exists a select group of key hedge fund managers who were adding to their stakes substantially (or already accumulated large positions).
Of the funds tracked by Insider Monkey, William B. Gray'sOrbis Investment Managementhas the biggest position in XPO Logistics Inc (NYSE:XPO), worth close to $1.1514 billion, comprising 7.8% of its total 13F portfolio. The second largest stake is held by Zachary Sternberg and Benjamin Stein ofSpruce House Investment Management, with a $685.2 million position; 25.2% of its 13F portfolio is allocated to the stock. Some other peers that are bullish comprise Farhad Nanji and Michael DeMichele'sMFN Partners, Israel Englander'sMillennium Managementand Joel Greenblatt'sGotham Asset Management.
Judging by the fact that XPO Logistics Inc (NYSE:XPO) has witnessed a decline in interest from the entirety of the hedge funds we track, logic holds that there was a specific group of money managers who sold off their entire stakes by the end of the third quarter. Interestingly, Doug Silverman and Alexander Klabin'sSenator Investment Groupsaid goodbye to the biggest position of the 700 funds tracked by Insider Monkey, valued at about $85.6 million in stock. D. E. Shaw's fund,D E Shaw, also sold off its stock, about $48.2 million worth. These transactions are important to note, as total hedge fund interest dropped by 18 funds by the end of the third quarter.
Let's go over hedge fund activity in other stocks similar to XPO Logistics Inc (NYSE:XPO). We will take a look at National Instruments Corporation (NASDAQ:NATI), Healthcare Trust Of America Inc (NYSE:HTA), Assurant, Inc. (NYSE:AIZ), and Nektar Therapeutics (NASDAQ:NKTR). All of these stocks' market caps match XPO's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NATI,28,604817,-1 HTA,19,458711,2 AIZ,39,617750,8 NKTR,17,252184,-3 Average,25.75,483366,1.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 25.75 hedge funds with bullish positions and the average amount invested in these stocks was $483 million. That figure was $2006 million in XPO's case. Assurant, Inc. (NYSE:AIZ) is the most popular stock in this table. On the other hand Nektar Therapeutics (NASDAQ:NKTR) is the least popular one with only 17 bullish hedge fund positions. XPO Logistics Inc (NYSE:XPO) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately XPO wasn't nearly as popular as these 20 stocks and hedge funds that were betting on XPO were disappointed as the stock returned -3.2% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Is SAGE Therapeutics Inc (SAGE) A Good Stock To Buy?
Based on the fact that hedge funds have collectively under-performed the market for several years, it would be easy to assume that their stock picks simply aren't very good. However, our research shows this not to be the case. In fact, when it comes to their very top picks collectively, they show a strong ability to pick winning stocks. This year hedge funds' top 20 stock picks easily bested the broader market, at 18.7% compared to 12.1%, despite there being a few duds in there like Berkshire Hathaway (even their collective wisdom isn't perfect). The results show that there is plenty of merit to imitating the collective wisdom of top investors.
SAGE Therapeutics Inc (NASDAQ:SAGE)investors should pay attention to a decrease in hedge fund interest of late. Our calculations also showed that sage isn't among the30 most popular stocks among hedge funds.
According to most shareholders, hedge funds are perceived as worthless, old financial tools of yesteryear. While there are more than 8000 funds in operation today, Our experts choose to focus on the top tier of this club, about 750 funds. These hedge fund managers command the majority of all hedge funds' total asset base, and by paying attention to their matchless equity investments, Insider Monkey has unearthed several investment strategies that have historically outstripped the market. Insider Monkey's flagship hedge fund strategy outstripped the S&P 500 index by around 5 percentage points per year since its inception in May 2014 through the end of May. We were able to generate large returns even by identifying short candidates. Our portfolio of short stocks lost 30.9% since February 2017 (through May 30th) even though the market was up nearly 24% during the same period. We just shared a list of 5 short targets in ourlatest quarterly updateand they are already down an average of 11.9% in less than a couple of weeks whereas our long picks outperformed the market by 2 percentage points in this volatile 2 week period.
Let's review the latest hedge fund action encompassing SAGE Therapeutics Inc (NASDAQ:SAGE).
At Q1's end, a total of 28 of the hedge funds tracked by Insider Monkey were long this stock, a change of -3% from one quarter earlier. On the other hand, there were a total of 37 hedge funds with a bullish position in SAGE a year ago. So, let's check out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in SAGE Therapeutics Inc (NASDAQ:SAGE) was held byPalo Alto Investors, which reported holding $136.4 million worth of stock at the end of March. It was followed by Farallon Capital with a $95.4 million position. Other investors bullish on the company included Casdin Capital, RA Capital Management, and Senator Investment Group.
Due to the fact that SAGE Therapeutics Inc (NASDAQ:SAGE) has witnessed falling interest from the aggregate hedge fund industry, we can see that there exists a select few fund managers who sold off their positions entirely heading into Q3. Interestingly, Steve Cohen'sPoint72 Asset Managementsaid goodbye to the biggest investment of all the hedgies monitored by Insider Monkey, valued at an estimated $24.6 million in call options. Dmitry Balyasny's fund,Balyasny Asset Management, also sold off its call options, about $15.4 million worth. These moves are interesting, as aggregate hedge fund interest fell by 1 funds heading into Q3.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as SAGE Therapeutics Inc (NASDAQ:SAGE) but similarly valued. These stocks are Formula One Group (NASDAQ:FWONK), The Interpublic Group of Companies Inc (NYSE:IPG), Farfetch Limited (NYSE:FTCH), and The Western Union Company (NYSE:WU). All of these stocks' market caps match SAGE's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position FWONK,35,1781125,0 IPG,26,853779,-3 FTCH,43,558624,25 WU,20,416982,-6 Average,31,902628,4 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 31 hedge funds with bullish positions and the average amount invested in these stocks was $903 million. That figure was $552 million in SAGE's case. Farfetch Limited (NYSE:FTCH) is the most popular stock in this table. On the other hand The Western Union Company (NYSE:WU) is the least popular one with only 20 bullish hedge fund positions. SAGE Therapeutics Inc (NASDAQ:SAGE) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on SAGE as the stock returned 8.1% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published atInsider Monkey.
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Jennifer Garner plays with migrant kids being detained in New Mexico
Jennifer Garner attends the 2019 Forbes Women's Summit on June 18, 2019, at Pier 60 in New York City. (Photo: Jamie McCarthy/Getty Images) Jennifer Garner recently had a very important playdate. The actress, who has a knack for creating endearing social media posts, filmed the June 12 encounter, which happened when she visited the children of migrant families in Deming, N.M., as part of her work with charity Save the Children . Garner is a trustee for the organization, which advocates for youth worldwide. Garner made the kids giggle as she pretended to leave, playfully calling out, Adios! They followed her around and went in for a group hug at the end of the clip that she shared. The whole thing is really sweet. View this post on Instagram A post shared by Jennifer Garner (@jennifer.garner) on Jun 19, 2019 at 1:54pm PDT The 47-year-old captioned the video explaining the program, called Child Friendly Spaces. The center is intended to comfort kids once they and their families are released from U.S. government detention centers. These people: No money. No baths. Need medical care. Need sleep. Need food. Need to organize travel. Children have been scared and on the move all of this time, Garner wrote. The town of Deming, NM is pouring out money, time, goods, heart, opening homes, because they see these families as real people. They are running a shelter to help families after theyve been released from detention. Garners followers, including a few of her celebrity friends, were all about her outreach. Chelsea Handler commented simply, I love you. Kimberly Williams-Paisley added, Thank you for posting this and for going there and for all you do with @savethechildren. This is awesome. Maria Shriver sent a bravo for her work on the frontlines of humanity. Commenters heaped praise on Garner for her good work. Im from deming and i can not believe you took time from your busy personal life to play with kids who obviously really needed it.. You are amazing jennifer a million times thank you!! You are a kind, big hearted soul, you are an inspiration!!, one video viewer wrote. Story continues Another gushed, Ugh, I love you. Thank you for making these babies smile. Your heart is truly the biggest! someone else raved. Thanks for being one of those that does something more than just talk about the issue! a fan wrote. Garner, of course, has three children of her own. She shares her little ones daughters Violet, 13, and Seraphina, 10, and 7-year-old son Samuel with former husband Ben Affleck. Read more on Yahoo Entertainment: George Takei says U.S. border camps are concentration camps: 'Yes, we are operating such camps again' Maren Morris says she lost 5,000 social media followers after sharing photo of Parkland shooting survivor: 'Not many country artists speak up' Make Keanu Reeves Time's Person of the Year, fans demand Want daily pop culture news delivered to your inbox? Sign up here for Yahoo Entertainment & Lifestyles newsletter. |
Here’s What Hedge Funds Think About Packaging Corporation Of America (PKG)
A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended March 31, so let’s proceed with the discussion of the hedge fund sentiment on Packaging Corporation Of America (NYSE:PKG).
Packaging Corporation Of America (NYSE:PKG)has seen a decrease in enthusiasm from smart money of late. Our calculations also showed that PKG isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
[caption id="attachment_745225" align="aligncenter" width="473"]
Noam Gottesman, GLG Partners[/caption]
We're going to take a glance at the key hedge fund action surrounding Packaging Corporation Of America (NYSE:PKG).
At the end of the first quarter, a total of 26 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -21% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in PKG over the last 15 quarters. With hedge funds' positions undergoing their usual ebb and flow, there exists an "upper tier" of key hedge fund managers who were upping their holdings substantially (or already accumulated large positions).
More specifically,AQR Capital Managementwas the largest shareholder of Packaging Corporation Of America (NYSE:PKG), with a stake worth $65.7 million reported as of the end of March. Trailing AQR Capital Management was Millennium Management, which amassed a stake valued at $46.9 million. MD Sass, GLG Partners, and Adage Capital Management were also very fond of the stock, giving the stock large weights in their portfolios.
Because Packaging Corporation Of America (NYSE:PKG) has witnessed a decline in interest from hedge fund managers, it's safe to say that there exists a select few fund managers who sold off their positions entirely heading into Q3. It's worth mentioning that David Cohen and Harold Levy'sIridian Asset Managementsaid goodbye to the largest stake of the 700 funds followed by Insider Monkey, valued at close to $5.6 million in stock, and Matthew Tewksbury's Stevens Capital Management was right behind this move, as the fund said goodbye to about $5.4 million worth. These moves are intriguing to say the least, as total hedge fund interest fell by 7 funds heading into Q3.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Packaging Corporation Of America (NYSE:PKG) but similarly valued. We will take a look at PG&E Corporation (NYSE:PCG), Erie Indemnity Company (NASDAQ:ERIE), F5 Networks, Inc. (NASDAQ:FFIV), and Okta, Inc. (NASDAQ:OKTA). All of these stocks' market caps resemble PKG's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position PCG,72,4787090,14 ERIE,17,98634,6 FFIV,24,1046558,0 OKTA,43,995674,3 Average,39,1731989,5.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 39 hedge funds with bullish positions and the average amount invested in these stocks was $1732 million. That figure was $212 million in PKG's case. PG&E Corporation (NYSE:PCG) is the most popular stock in this table. On the other hand Erie Indemnity Company (NASDAQ:ERIE) is the least popular one with only 17 bullish hedge fund positions. Packaging Corporation Of America (NYSE:PKG) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately PKG wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); PKG investors were disappointed as the stock returned -10.1% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Train derails near Nevada-Utah line; no injuries reported
WELLS, Nev. (AP) A train carrying military munitions derailed in the high desert of northeast Nevada on Wednesday, closing an interstate for about an hour before emergency crews determined there was no danger. No injuries were reported. Cars carrying the munitions to a Nevada Army depot were not among the 23 that derailed near the rural community of Wells not far from the Utah-Nevada state line, officials said. A white aluminum oxide was released, the Nevada Highway Patrol said. The powder was described as a mild skin irritant, but not a hazardous material. Union Pacific spokeswoman Kristen South confirmed there were hazardous materials and ammunition on the train but said none were in the derailed cars. Some non-hazardous aluminum oxide was spilled along with a small amount of diesel fuel, South said. She said earlier reports that the spilled substance was vegetable oil were inaccurate. "Union Pacific is working on site cleanup," she wrote in an email to The Associated Press. "A timeline for completion is not known, at this time. The cause of the derailment is under investigation." About 60 miles (96 kilometers) of the interstate near the railroad was closed in both directions from about 11 a.m. to noon. "At this time, we have no information regarding why the train derailed," Highway Patrol Trooper Jim Stewart said in a statement. The train was headed west to an Army depot in Hawthorne that dates to 1930 and was developed as a Navy ammunition storage area because of its remoteness. It is about 125 miles (200 kilometers) southeast of Reno. It was transferred in 1977 to the Army. It provides storage for old munitions and explosives, including some that could be reactivated, and serves as a training facility for special forces units. In March 2013, it was the site of a training accident that killed seven Marines and injured eight others. |
Does K.M. Sugar Mills Limited (NSE:KMSUGAR) Have A Volatile Share Price?
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If you're interested in K.M. Sugar Mills Limited (NSE:KMSUGAR), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first category is company specific volatility. This can be dealt with by limiting your exposure to any particular stock. The other type, which cannot be diversified away, is the volatility of the entire market. Every stock in the market is exposed to this volatility, which is linked to the fact that stocks prices are correlated in an efficient market.
Some stocks see their prices move in concert with the market. Others tend towards stronger, gentler or unrelated price movements. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
View our latest analysis for K.M. Sugar Mills
Zooming in on K.M. Sugar Mills, we see it has a five year beta of 1.91. This is above 1, so historically its share price has been influenced by the broader volatility of the stock market. Based on this history, investors should be aware that K.M. Sugar Mills are likely to rise strongly in times of greed, but sell off in times of fear. Many would argue that beta is useful in position sizing, but fundamental metrics such as revenue and earnings are more important overall. You can see K.M. Sugar Mills's revenue and earnings in the image below.
With a market capitalisation of ₹681m, K.M. Sugar Mills is a very small company by global standards. It is quite likely to be unknown to most investors. It has a relatively high beta, suggesting it is fairly actively traded for a company of its size. Because it takes less capital to move the share price of a small company like this, when a stock this size is actively traded it is quite often more sensitive to market volatility than similar large companies.
Since K.M. Sugar Mills tends to moves up when the market is going up, and down when it's going down, potential investors may wish to reflect on the overall market, when considering the stock. In order to fully understand whether KMSUGAR is a good investment for you, we also need to consider important company-specific fundamentals such as K.M. Sugar Mills’s financial health and performance track record. I highly recommend you dive deeper by considering the following:
1. Future Outlook: What are well-informed industry analysts predicting for KMSUGAR’s future growth? Take a look at ourfree research report of analyst consensusfor KMSUGAR’s outlook.
2. Past Track Record: Has KMSUGAR been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of KMSUGAR's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how KMSUGAR measures up against other companies on valuation. You could start with thisfree list of prospective options.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Do You Know What Tribhovandas Bhimji Zaveri Limited's (NSE:TBZ) P/E Ratio Means?
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This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll look at Tribhovandas Bhimji Zaveri Limited's (NSE:TBZ) P/E ratio and reflect on what it tells us about the company's share price. Based on the last twelve months,Tribhovandas Bhimji Zaveri's P/E ratio is 18.11. That is equivalent to an earnings yield of about 5.5%.
See our latest analysis for Tribhovandas Bhimji Zaveri
Theformula for price to earningsis:
Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Or for Tribhovandas Bhimji Zaveri:
P/E of 18.11 = ₹42.2 ÷ ₹2.33 (Based on the trailing twelve months to March 2019.)
A higher P/E ratio means that investors are payinga higher pricefor each ₹1 of company earnings. That isn't necessarily good or bad, but a high P/E implies relatively high expectations of what a company can achieve in the future.
P/E ratios primarily reflect market expectations around earnings growth rates. That's because companies that grow earnings per share quickly will rapidly increase the 'E' in the equation. And in that case, the P/E ratio itself will drop rather quickly. Then, a lower P/E should attract more buyers, pushing the share price up.
Tribhovandas Bhimji Zaveri saw earnings per share decrease by 27% last year. And it has shrunk its earnings per share by 22% per year over the last five years. This growth rate might warrant a below average P/E ratio.
One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. The image below shows that Tribhovandas Bhimji Zaveri has a lower P/E than the average (29.6) P/E for companies in the specialty retail industry.
This suggests that market participants think Tribhovandas Bhimji Zaveri will underperform other companies in its industry. Many investors like to buy stocks when the market is pessimistic about their prospects. It is arguably worth checkingif insiders are buying shares, because that might imply they believe the stock is undervalued.
One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. So it won't reflect the advantage of cash, or disadvantage of debt. The exact same company would hypothetically deserve a higher P/E ratio if it had a strong balance sheet, than if it had a weak one with lots of debt, because a cashed up company can spend on growth.
Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio.
Tribhovandas Bhimji Zaveri has net debt worth a very significant 201% of its market capitalization. If you want to compare its P/E ratio to other companies, you must keep in mind that these debt levels would usually warrant a relatively low P/E.
Tribhovandas Bhimji Zaveri's P/E is 18.1 which is above average (15.7) in the IN market. With relatively high debt, and no earnings per share growth over twelve months, it's safe to say the market believes the company will improve its earnings growth in the future.
Investors have an opportunity when market expectations about a stock are wrong. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. So thisfreevisual report on analyst forecastscould hold the key to an excellent investment decision.
Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Tori Spelling Says Her Oldest Kids Didn't Recognize Her in the Original 'Beverly Hills, 90210'
Things didn’t go quite as planned when Tori Spelling first showed her children old episodes of Beverly Hills, 90210. The actress, 46, revealed that her kids didn’t immediately recognize her when she first showed them the beloved teen soap, in which she starred as Donna Martin from 1990 to 2000. “So the first time I showed my oldest kids was probably four or five years ago, and they’re 11 and 12 now, and they couldn’t find me in it,” she told the Australian radio show 2DayFM Breakfast with Grant, Ed & Ash . “They were watching a scene, and I was like, ‘Okay, where’s Mommy?’ They’re like, ‘There’s Jennie [Garth] , there’s Ian [Ziering] ,’ and I’m like, ‘And Mom?’ and they’re like, ‘Nope!'” she said with a laugh. Spelling shares five children with husband Dean McDermott : Liam Aaron , 12, Stella Doreen , 11, Hattie Margaret , 7, Finn Davey , 6, and Beau Dean , 2. Although her kids didn’t recognize her in the original series, they have another chance to see their mom take over the famous zipcode, as Spelling will appear in the upcoming Fox reboot . Earlier this month, Spelling expressed gratitude to be part of the reboot, which has been dubbed BH90210 . Tori Spelling | Snap/REX/Shutterstock; Noel Vasquez/Getty Images RELATED: The Cast of Beverly Hills, 90210 : Where Are They Now? “Just taking a moment in between camera set ups to look around and appreciate how amazing it is that we are coming home to @foxtv this August,” she wrote in an Instagram caption underneath a photo of herself on set. “I was just 16 years old when the original 90210 started filming and too young to really understand and appreciate the impact our show would have on our generation and generations to come,” she added. “And, the lifetime bond I would go on to have with all of these actors that became a family to me.” “Well, now I get a do over. At 46 years old this time I’m taking the time to appreciate every moment as it happens. #workfamily #bh90210 #grateful” she concluded. Joining her for the revival are original cast members are Shannen Doherty , Garth, 47, Brian Austin Green , Jason Priestley , Gabrielle Carteris and Ziering, 55. BH90210 premieres on Wednesday, August 7 at 9 p.m. ET on Fox. |
Why Shopify Stock Soared to a New All-Time High
E-commerce platform specialistShopify(NYSE: SHOP)made some important product announcements on Wednesday morning. The game-changing new features sent shares nearly 8% higher, putting the stock at an all-time high.
The event included a number of key announcements, from a redesigned online store to an updated Shopify Plus platform. But the biggest announcement is one that puts Shopify in direct competition withAmazon.com(NASDAQ: AMZN). No wonder investors were upbeat.
Here's some of what Shopify unveiled.
Image source: Shopify.
Building on itssuccess with enterprise customers, the company overhauled its Shopify Plus platform, its e-commerce platform for enterprise clients. The new platform is focused on empowering merchants to manage their businesses from a 10,000-foot view, giving them more control and visibility across multiple stores.
"The new Shopify Plus gives decision makers key information across all of their stores, providing greater control of users and permissions, store additions, settings, cross-shop navigation, and more," Shopify said in a press release.
Another key area of emphasis in the latest updates are features that make selling internationally easier than ever. Besides introducing 11 new language capabilities, it debuted a new Translations API, an application programming interface for translating buyer-facing content. "These enhancements allow business owners to sell with a consistent shopping experience in multiple languages," Shopify said.
It also redesigned its online store experience. The new online store focuses on making it "even easier for merchants to customize the look and feel of their store to meet the evolving expectations of shoppers, without editing the code," Shopify said. Updates include videos and 3D models of products and the ability to offer subscriptions directly within Shopify's checkout.
The biggest news Wednesday was undoubtedly the company's decision to launch a fulfillment network. Initially only available to early access customers, the U.S.-based network will give merchants access to a network of fulfillment centers across the country where Shopify will pack and ship goods.
Powering its fulfillment centers is machine learning that will help predict the closest fulfillment centers to orders and optimize inventory quantities, ultimately minimizing delivery costs. In addition, the fulfillment network will put its merchants' brand and customer experience "front and center," Shopify said.
Interestingly, Shopify has a good value proposition to stand on its own against Amazon. Unlike Amazon, the e-commerce platform isn't competing with its own merchants by bringing to market private-label brands. Shopify merchants get access to an objective fulfillment network whose interests are directly aligned with theirs.
The news comes on the heels of the company'sbetter-than-expected first quarter, adding more momentum to its strong run.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors.Daniel Sparkshas no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and Shopify. The Motley Fool has adisclosure policy. |
Trump-Xi meeting unlikely to resolve trade differences, could lead to more talks-media
BEIJING/SHANGHAI (Reuters) - Upcoming trade talks between the leaders of China and the United States are unlikely to immediately resolve major disagreements between the two sides but could start a new phase in negotiations, Chinese state media said on Thursday.
China and the United States earlier this week said they were reviving talks ahead of a meeting next week between Presidents Donald Trump and Xi Jinping, cheering financial markets on hopes that it may ease intensifying trade frictions.
Talks to reach a broad deal broke down last month after U.S. officials accused China of backing away from previously agreed commitments.
The two countries are in the middle of a costly trade dispute and have slapped increasingly severe tariffs on each other's imports. China has vowed to not give in on issues of principle or under U.S. pressure.
Both parties are "in the mood for serious dialogue" as a full-blown trade war was "lose-lose" but one single meeting is unlikely to wrap everything up, the official China Daily said in an editorial.
"The two parties' expectations are too divergent to allow that," it said.
"More likely than not, the one-on-one meeting will end up being the start of a new phase in the negotiations with the two leaders personally setting out their country's respective bottom lines."
The Global Times, which said that China had held the telephone conversation with the United States upon request, said Beijing had sent a clear signal to Washington that "China can never be daunted."
"Negotiation outcomes are not often obtained through talks, but through fights. If desiring a good negotiation result, China must persist and not fear," said the newspaper, which is published by the ruling Communist Party's People's Daily.
"As trade between China and the U.S. is highly likely to continue, the two countries may eventually reach an agreement. But China will not be impatient or afraid of setbacks."
China has managed to get the United States back to the table with its determination and ability to "prepare for war", Taoran Notes, a widely read and influential WeChat account run by the Economic Daily, wrote late on Wednesday.
"Only by being able to fight, daring to fight and being good at fighting can you stop a war," it wrote.
The trade dispute between the world's largest economies has pressured financial markets and damaged the global economy.
Trump has threatened to put tariffs on another $325 billion of goods, covering nearly all the remaining Chinese imports into the United States, including consumer products such as cellphones, computers and clothing.
The Trump administration has accused China of failing to protect intellectual property rights, forced technology transfers and of failing to provide a level playing field for U.S. companies.
China has repeatedly promised to open its market wider to foreign investors and provide them with better services and treatment.
Speaking to a group of 19 CEOs of foreign multinationals in Beijing on Thursday, Chinese Premier Li Keqiang reiterated those promises.
"China will maintain our long-standing commitment to reform and opening in order to continue to expand and open. We welcome more and more foreign investment to come to China," Li said, in comments in front of reporters.
"We will also relax (restrictions on) access to even more fields to create a market-oriented, law-based internationalised business environment."
(Reporting by Ben Blanchard and Brenda Goh; Editing by Sam Holmes, Michael Perry & Kim Coghill) |
China, U.S. to resume trade talks but China says demands must be met
(This online version of June 20 story fixes spelling to "denuclearization" in the penultimate paragraph.)
By Yawen Chen and Ben Blanchard
BEIJING (Reuters) - China said on Thursday it hoped U.S. officials would bring a problem-solving attitude to renewed trade talks in advance of a meeting between Presidents Donald Trump and Xi Jinping next week in Japan.
Negotiations to reach a broad trade deal broke down last month after U.S. officials accused China of backing away from previously agreed commitments.
A telephone call between Trump and Xi on Tuesday, as well as confirmation the two will meet in Japan on the sidelines of a Group of 20 summit, have rekindled hopes of a detente.
"The heads of the two trade teams will communicate, according to instructions passed down from the two presidents," Chinese commerce ministry spokesman Gao Feng told reporters.
"We hope (the United States) will create the necessary conditions and atmosphere for solving problems through dialogue as equals."
U.S. Trade Representative Robert Lighthizer said on Wednesday he would speak by telephone to Liu He, China's vice premier and chief negotiator in the trade talks, "in the next day and a half."
The two countries have imposed tariffs on each other's imports, disrupting global supply chains and roiling financial markets. China has vowed to not give in to U.S. pressure on issues of principle.
Trump has threatened to extend tariffs to another $300 billion worth of goods, covering nearly all remaining Chinese imports into the United States, including consumer products such as cellphones, computers and clothing.
China says three main sticking points remain between the two sides in trade negotiations. They are the removal of tariffs imposed in the trade war, the scale of goods purchases from the United States that China will make to help reduce the trade imbalance between the two, and the need for a "balanced" text for any trade deal. Those "matters of principle" cannot be compromised, China has said.
However, Gao still expressed optimism about the possibility of agreement on issues such as structural economic reform, implementation, protection of intellectual property (IP) rights and market opening.
"Both sides have immense mutual interests. I believe by taking care of each other's concerns through equal dialogue, both sides will for sure be able to find a solution to solve the problems properly," Gao said.
U.S. BUSINESS
The U.S. Trade Representative on Thursday was holding the fourth of seven days of hearings for manufacturers, retailers and other U.S. businesses to comment on the proposed tariffs. Individuals and firms can also submit comments to an online government docket.
Apple Inc weighed in with a comment filed online on Thursday that the proposed tariffs on goods including iPhones, iPads, and Macs will hurt its global competitiveness.
The company also noted that tariffs would reduce its contribution to the U.S. Treasury. The company is the largest U.S. corporate taxpayer and pledged in 2018 to directly contribute over $350 billion to the U.S. economy over five years.
The Trump administration has accused China of failing to protect IP, forcing U.S. companies to transfer technology to Chinese partners, and failing to provide a level playing field for U.S. companies.
China has repeatedly promised to open its market wider to foreign investors and provide them with better services and treatment.
Speaking to a group of 19 chief executives of foreign multinationals in Beijing on Thursday, Premier Li Keqiang reiterated those promises.
"China will maintain our long-standing commitment to reform and opening in order to continue to expand and open. We welcome more and more foreign investment to come to China," Li said, in comments in front of reporters.
"We will also relax (restrictions on) access to even more fields to create a market-oriented, law-based internationalized business environment."
LOSE-LOSE
Neither side has signaled it would shift from positions that led to the impasse last month, when Beijing revised a draft of the trade deal, removing references to changes in Chinese law.
While talks between Xi and Trump in Japan were unlikely to resolve major disagreements immediately, they could start a new phase in negotiations, Chinese state media said on Thursday.
The official China Daily said in an editorial both parties were "in the mood for serious dialogue" as a full-blown trade war was "lose-lose", but one single meeting was unlikely to wrap everything up.
"More likely than not, the one-on-one meeting will end up being the start of a new phase in the negotiations with the two leaders personally setting out their country's respective bottom lines," it said.
China has managed to get the United States back to the table with its determination and ability to "prepare for war", Taoran Notes, a widely read and influential WeChat account run by the Economic Daily, wrote late on Wednesday.
"Only by being able to fight, daring to fight and being good at fighting can you stop a war," it wrote.
President Xi was in North Korea on Thursday on a two-day trip, the first by a Chinese leader in 14 years, re-asserting a key leverage point China has as Pyongyang's only major ally.
Denuclearization of the Korean peninsula is one of Trump's foreign policy priorities, but Pyongyang has resumed some weapons tests since a summit with North Korean leader Kim Jong Un collapsed in Hanoi earlier this year.
"The international community hopes that North Korea and the United States can talk and for the talks to get results," Chinese state TV paraphrased Xi as telling Kim.
(Reporting by Yawen Chen, Ben Blanchard and Brenda Goh; Writing by Sonya Hepinstall; Editing by Sam Holmes, Michael Perry & Susan Thomas) |
Do Insiders Own Shares In Pil Italica Lifestyle Limited (NSE:PILITA)?
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A look at the shareholders of Pil Italica Lifestyle Limited (NSE:PILITA) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.
With a market capitalization of ₹2.2b, Pil Italica Lifestyle is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have not yet purchased much of the company. We can zoom in on the different ownership groups, to learn more about PILITA.
See our latest analysis for Pil Italica Lifestyle
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Institutions own less than 5% of Pil Italica Lifestyle. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.
We note that hedge funds don't have a meaningful investment in Pil Italica Lifestyle. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Shareholders would probably be interested to learn that insiders own shares in Pil Italica Lifestyle Limited. In their own names, insiders own ₹111m worth of stock in the ₹2.2b company. Some would say this shows alignment of interests between shareholders and the board, though I generally prefer to see bigger insider holdings. But it might be worth checkingif those insiders have been selling.
The general public holds a 21% stake in PILITA. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
It seems that Private Companies own 71%, of the PILITA stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.
Many find it usefulto take an in depth look at how a company has performed in the past. You can accessthisdetailed graphof past earnings, revenue and cash flow.
Of coursethis may not be the best stock to buy. Therefore, you may wish to see ourfreecollection of interesting prospects boasting favorable financials.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Regency Ceramics Limited (NSE:REGENCERAM) Insiders Increased Their Holdings
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares inRegency Ceramics Limited(NSE:REGENCERAM).
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
View our latest analysis for Regency Ceramics
There wasn't any very large single transaction over the last year, but we can still observe some trading.
Over the last year, we can see that insiders have bought 628k shares worth ₹1.7m. Regency Ceramics may have bought shares in the last year, but they didn't sell any. The average buy price was around ₹2.69. I'd consider this a positive as it suggests insiders see value at around the current price, which is ₹2.50. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at thisfreelist of companies. (Hint: insiders have been buying them).
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Regency Ceramics insiders own 70% of the company, currently worth about ₹46m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
It doesn't really mean much that no insider has traded Regency Ceramics shares in the last quarter. But insiders have shown more of an appetite for the stock, over the last year. With high insider ownership and encouraging transactions, it seems like Regency Ceramics insiders think the business has merit. Along with insider transactions, I recommend checking if Regency Ceramics is growing revenue. This free chart ofhistoric revenue and earnings should make that easy.
Of courseRegency Ceramics may not be the best stock to buy. So you may wish to see thisfreecollection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Uber’s “Crypto” Libra Support Could Be The End of The Giant
ByCCN Markets: There’s a lot of irony in Uber’s lack of crypto acceptance contrasted with itssupport of Facebook’s Libra project. The company will play a vital role in the early stages of the network, and presumably, it will be one of many vendors who accept the “crypto” out of the gate.
Several companies have already agreed to accept the Libra. The Libra can be used in a myriad of ways, from sending money to loved ones to paying overseas contractors. What will be interesting to see is whether a vibrant network of Libra-to-cash methods emerges. Will we have ATMs that allow us to cash out ourFacebook money?
Aside from Uber, Visa issupporting Libra. Visa and other credit card companies have long shown interest inblockchain technology. Facebook and Telegram are the first two overtly mainstream companies to launch blockchains, but they’re not the last.
The disruptive nature of blockchain technology is that it can affect most industries in one way or another.
Uber is a centralized effort at an idea that could be accomplished with relative simplicity on a blockchain. Imagine a future where your autonomous smart vehicle goes and earns you money when you’re not using it. It takes you home, waits a while, and then it dispatches it to pick someone up. You get paid for its services, and likely enough Facebook’s Libra will be a payment option.
Read the full story on CCN.com. |
Andreessen Horowitz: How Facebook's Libra Cryptocurrency Will Be Governed
Everyone is talking about Libra,Facebook’s big splash in the cryptocurrency space, announced on Tuesday. But on Wednesday atFortune’sinauguralBrainstorm Financeconference in Montauk, N.Y., Venture capital firm Andreessen Horowitz made one thing clear: It will have just as much power asFacebookin overseeing the governance of the new digital currency.
Kathryn Haun, general partner at Andreessen, told the Brainstorm Finance audience that a consortium of 28 founding members, called the Libra Association, will spend the next few months debating decisions around how the new digital currency will be overseen. And all of those members will have a seat at the table in determining the direction.
“One of they key factors in our decision to join was that we would in fact have—and all members would have—an equal vote,” Haun said.
Facebook is developinga new digital currencydesigned to work with the company’s family of apps, though it will be available for use beyond that. Company executives expect the currency to debut in mid-2020. Libra is expected to have lower volatility than some of the pioneering cryptocurrencies like Bitcoin.
Along with Andreessen, PayPal, Coinbase,Visa, and MasterCard are a part of the Libra Association, tasked with mapping out oversight for the currency. Haun, a former Justice Department prosecutor, said one of the challenges the association will have is pushing the project forward in a way that fosters innovation but also protects consumers.
For example, if a court requests that an identity be traced, is that something Libra should be able to do?
“This is a very important conversation,” said Haun, who set up the U.S. government’s first cryptocurrency task force in 2012. “There will be debates because there are very different points of view, even now at the Libra Association.”
Once the association can have those debates and vote—with equal power—on the resolutions, they can then start drafting the governance documents. Haun expects that those documents to be shared with the public.
How effective the association will be as a governing body is yet to be determined, Haun said. But she reiterated that with non-governmental organizations, financial organizations, and Facebook all equally a part of the association, a diversity of thoughts and interests will be well represented.
“I think of it as a constitutional convention,” she said. “You have all these different states coming in trying to form this union.”
—Brainstorm Finance 2019: Watch the livestreamof the inaugural conference
—Bank of America CEO: “We want acashless society”
—Tala CEO: HowFacebook’s Libra cryptocurrencycan help companies scale
—Charles Schwab CEO: Actually, we’rekilling it with millennials
—Listen to our new audio briefing,Fortune500 Daily
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E-Cigs Face Ruin as FDA Narrows Window to File Applications
Already facing tougher scrutiny because of the rising teen use of electronic cigarettes, the industry now faces a dramatically shortened window to submit applications to the Food and Drug Administration for review.
A U.S. district court judge ruled last month the regulatory agency illegally allowed the devices to remain on the market without a safety review and gave the agency two weeks to come up with a plan to correct the oversight.
The FDA subsequently recommended e-cig manufacturers be given just 10 months to submit their preapproval applications, after which they would be allowed to stay on the market for a year while they were reviewed. The antismoking groups that sued the FDA for failing to regulate e-cig makers want the judge to impose a maximum six-month deadline.
In 2016 , the FDA was given the power to regulate e-cigs but when President Trump took office the following year, then-commissioner Scott Gottlieb pushed the date back to 2022. At that point, laws regulating the devices would become effective, but manufacturers would still be allowed to bring their products to market in the meantime.
That was a short-lived honeymoon, because followingAltria(NYSE: MO)investing $13 billionin industry leader Juul Labs, the commissioner proposedtough new regulationsand moved the deadline for compliance up to 2021.
In his ruling, though, the judge was dismissive of the FDA's actions and accused the agency of abdicating its responsibility under the language of its statutory authority to regulate manufacturers. And he held it was the e-cig companies' own fault if they'd relied upon the FDA's guidance in conducting their business, writing that "if they have chosen to delay their preparations ..., then any hardship occasioned by their now having to comply is of their own making."
He also found them complicit if not actually conspiratorial in using the window of opportunity the FDA's regulation postponement provided to lure teens to e-cigs and get them hooked.
He wrote, "Arguably, the five-year compliance safe-harbor has allowed the manufacturers enough time to attract new, young users and get them addicted to nicotine before any of their products, labels, or flavors are pulled from the market, at which time the youth are likely to switch to one of the other thousands of tobacco products that are approved – results entirely contrary to the express purpose of the Tobacco Control Act."
Regardless of the judge's animus toward the FDA and the e-cig industry, manufacturers are going to have difficulty in complying with regulations that will require nearly every electronic cigarette device on the market to be reviewed on whether or not it can still be sold.
It raises the potential that some of these devices, which have been credited with getting smokers to switch to a less harmful alternative, will be completely withdrawn from the market.
Because the agency has also proved incapable of moving at anything other than a glacial pace in determining suitability for market, some manufacturers also stand to go out of business before their applications see the light of day, since the FDA will only allow their products to stay on the market for a year while the agency has historically taken over two years to arrive at a decision.
To date, only one premarket tobacco product application (PMTA) for e-cigs has been approved by the FDA, that forPhilip Morris International's (NYSE: PM) IQOS device, which will be sold under Altria's Marlboro brand. It was submitted in March 2017 but wasn't approved until two years later, and the tobacco giant's application for the device to be considered a reduced-risk product was actually submitted three monthsbeforethe PMTA, but the agency still hasn't made a decision on how it should be classified.
Each was a multimillion-page document that cost millions of dollars to produce, meaning only manufacturers with the deepest pockets -- or, like Juul, those aligned with a tobacco giant -- will be able to begin the compliance process, let alone navigate the lengthy regulatory labyrinth. It's why the regulations were ultiamtely dubbed the "Big Tobacco Protection Act" by critics.
Now that the judge has issued his order and the FDA has offered a compromise that is only slightly less onerous than the one proposed by those wanting to put the industry out of business, it may just result in the ruinous, end-of-the-world predictions industry advocates made two years ago when the regulatory framework that's now about to ensnare electronic cigarettes was erected.
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Does Renaissance Global Limited (NSE:RGL) Have A Good P/E Ratio?
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This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll look at Renaissance Global Limited's (NSE:RGL) P/E ratio and reflect on what it tells us about the company's share price.Renaissance Global has a price to earnings ratio of 6.03, based on the last twelve months. That means that at current prices, buyers pay ₹6.03 for every ₹1 in trailing yearly profits.
Check out our latest analysis for Renaissance Global
Theformula for price to earningsis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for Renaissance Global:
P/E of 6.03 = ₹270 ÷ ₹44.79 (Based on the year to March 2019.)
A higher P/E ratio means that investors are payinga higher pricefor each ₹1 of company earnings. That isn't necessarily good or bad, but a high P/E implies relatively high expectations of what a company can achieve in the future.
Probably the most important factor in determining what P/E a company trades on is the earnings growth. Earnings growth means that in the future the 'E' will be higher. Therefore, even if you pay a high multiple of earnings now, that multiple will become lower in the future. Then, a lower P/E should attract more buyers, pushing the share price up.
Renaissance Global increased earnings per share by a whopping 31% last year. And earnings per share have improved by 24% annually, over the last five years. So we'd generally expect it to have a relatively high P/E ratio.
The P/E ratio indicates whether the market has higher or lower expectations of a company. The image below shows that Renaissance Global has a lower P/E than the average (11) P/E for companies in the luxury industry.
Renaissance Global's P/E tells us that market participants think it will not fare as well as its peers in the same industry. While current expectations are low, the stock could be undervalued if the situation is better than the market assumes. You should delve deeper. I like to checkif company insiders have been buying or selling.
The 'Price' in P/E reflects the market capitalization of the company. That means it doesn't take debt or cash into account. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash).
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
Net debt totals a substantial 107% of Renaissance Global's market cap. This is a relatively high level of debt, so the stock probably deserves a relatively low P/E ratio. Keep that in mind when comparing it to other companies.
Renaissance Global's P/E is 6 which is below average (15.7) in the IN market. The company may have significant debt, but EPS growth was good last year. If it continues to grow, then the current low P/E may prove to be unjustified.
When the market is wrong about a stock, it gives savvy investors an opportunity. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. We don't have analyst forecasts, but you could get a better understanding of its growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Some Network18 Media Investments (NSE:NETWORK18) Shareholders Have Copped A Big 54% Share Price Drop
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Statistically speaking, long term investing is a profitable endeavour. But unfortunately, some companies simply don't succeed. Zooming in on an example, theNetwork18 Media & Investments Limited(NSE:NETWORK18) share price dropped 54% in the last half decade. We certainly feel for shareholders who bought near the top. And it's not just long term holders hurting, because the stock is down 38% in the last year. Shareholders have had an even rougher run lately, with the share price down 20% in the last 90 days.
See our latest analysis for Network18 Media & Investments
Because Network18 Media & Investments is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Over five years, Network18 Media & Investments grew its revenue at 2.3% per year. That's not a very high growth rate considering it doesn't make profits. This lacklustre growth has no doubt fueled the loss of 15% per year, in that time. We'd want to see proof that future revenue growth is likely to be significantly stronger before getting too interested in Network18 Media & Investments. However, it's possible too many in the market will ignore it, and there may be an opportunity if it starts to recover down the track.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
Take a more thorough look at Network18 Media & Investments's financial health with thisfreereport on its balance sheet.
While the broader market gained around 0.2% in the last year, Network18 Media & Investments shareholders lost 38%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 15% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. You could get a better understanding of Network18 Media & Investments's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
We will like Network18 Media & Investments better if we see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Have We Reached Peak Binance?
ByCCN Markets: Ah,Binance. Many of us remember the original idea. Plenty of us decided to pass on theICO, which has provided some of the highest returns of any investment in recent times.
There were plenty of good reasons to pass on the ICO. The only stated purpose of the token at the time was that it would give you a discount on trading. There was no reason to believe that Binance would suddenly become a massive destination for traders.
Fast-forward a couple of years, and Binance is many things. Binance is a launchpad for stuff like the BitTorrent token. Binance is a decentralized exchange provider. Binance is a blockchain. Binance is a cryptocurrency. And, of course, at its heart, Binance is a reputable and widely used exchange.
Binance has become such a presence in the space that some people even floated the idea of rewriting history to thwart some successful attackers.
Changpeng Zhao could tweet the contents of his breakfast, and it would get retweeted a few hundred times.
Read the full story on CCN.com. |
Does Moreton Resources's (ASX:MRV) Share Price Gain of 50% Match Its Business Performance?
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Stock pickers are generally looking for stocks that will outperform the broader market. And while active stock picking involves risks (and requires diversification) it can also provide excess returns. For example, theMoreton Resources Limited(ASX:MRV) share price is up 50% in the last 5 years, clearly besting than the market return of around 12% (ignoring dividends).
See our latest analysis for Moreton Resources
Moreton Resources didn't have any revenue in the last year, so it's fair to say it doesn't yet have a proven product (or at least not one people are paying for). So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. For example, they may be hoping that Moreton Resources finds fossil fuels with an exploration program, before it runs out of money.
We think companies that have neither significant revenues nor profits are pretty high risk. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing.
Moreton Resources had liabilities exceeding cash by AU$24,538,347 when it last reported in December 2018, according to our data. That puts it in the highest risk category, according to our analysis. So we're surprised to see the stock up 8.4% per year, over 5 years, but we're happy for holders. Investors must really like its potential. You can see in the image below, how Moreton Resources's cash levels have changed over time (click to see the values).
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. However you can take a look at whether insiders have been buying up shares. It's often positive if so, assuming the buying is sustained and meaningful. Luckily we are in a position to provide you with thisfreechart of insider buying (and selling).
We'd be remiss not to mention the difference between Moreton Resources'stotal shareholder return(TSR) and itsshare price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Moreton Resources hasn't been paying dividends, but its TSR of 61% exceeds its share price return of 50%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.
Investors in Moreton Resources had a tough year, with a total loss of 39%, against a market gain of about 11%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 10.0%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Were Hedge Funds Right About Flocking Into Diebold Nixdorf Incorporated (DBD) ?
As we already know from media reports and hedge fund investor letters, many hedge funds lost money in fourth quarter, blaming macroeconomic conditions and unpredictable events that hit several sectors, with technology among them. Nevertheless, most investors decided to stick to their bullish theses and recouped their losses by the end of the first quarter. We get to see hedge funds' thoughts towards the market and individual stocks by aggregating their quarterly portfolio movements and reading their investor letters. In this article, we will particularly take a look at what hedge funds think about Diebold Nixdorf Incorporated (NYSE:DBD).
IsDiebold Nixdorf Incorporated (NYSE:DBD)a bargain? The best stock pickers are in an optimistic mood. The number of bullish hedge fund bets increased by 7 lately. Our calculations also showed that DBD isn't among the30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
[caption id="attachment_375529" align="aligncenter" width="450"]
Mario Gabelli of GAMCO Investors[/caption]
Let's take a look at the fresh hedge fund action surrounding Diebold Nixdorf Incorporated (NYSE:DBD).
At Q1's end, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 64% from the fourth quarter of 2018. Below, you can check out the change in hedge fund sentiment towards DBD over the last 15 quarters. So, let's see which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Diebold Nixdorf Incorporated (NYSE:DBD) was held byGAMCO Investors, which reported holding $64.6 million worth of stock at the end of March. It was followed by Ancora Advisors with a $22.4 million position. Other investors bullish on the company included D E Shaw, Prescott Group Capital Management, and Brigade Capital.
As aggregate interest increased, specific money managers were leading the bulls' herd.D E Shaw, managed by D. E. Shaw, assembled the largest position in Diebold Nixdorf Incorporated (NYSE:DBD). D E Shaw had $22.3 million invested in the company at the end of the quarter. Matthew Hulsizer'sPEAK6 Capital Managementalso initiated a $5.2 million position during the quarter. The other funds with brand new DBD positions are David MacKnight'sOne Fin Capital Management, Joel Greenblatt'sGotham Asset Management, and Cliff Asness'sAQR Capital Management.
Let's check out hedge fund activity in other stocks similar to Diebold Nixdorf Incorporated (NYSE:DBD). These stocks are Systemax Inc. (NYSE:SYX), PlayAGS, Inc. (NYSE:AGS), QAD Inc. (NASDAQ:QADA), and CBTX, Inc. (NASDAQ:CBTX). This group of stocks' market values resemble DBD's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position SYX,12,23366,1 AGS,22,130434,11 QADA,16,124879,-1 CBTX,8,22427,0 Average,14.5,75277,2.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $75 million. That figure was $166 million in DBD's case. PlayAGS, Inc. (NYSE:AGS) is the most popular stock in this table. On the other hand CBTX, Inc. (NASDAQ:CBTX) is the least popular one with only 8 bullish hedge fund positions. Diebold Nixdorf Incorporated (NYSE:DBD) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately DBD wasn't nearly as popular as these 20 stocks and hedge funds that were betting on DBD were disappointed as the stock returned -17.8% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Sterling Bancorp (STL)
Insider Monkey has processed numerous 13F filings of hedge funds and successful investors to create an extensive database of hedge fund holdings. The 13F filings show the hedge funds' and successful investors' positions as of the end of the first quarter. You can find write-ups about an individual hedge fund's trades on numerous financial news websites. However, in this article we will take a look at their collective moves and analyze what the smart money thinks of Sterling Bancorp (NYSE:STL) based on that data.
IsSterling Bancorp (NYSE:STL)a healthy stock for your portfolio? Prominent investors are turning bullish. The number of long hedge fund bets improved by 1 lately. Our calculations also showed that stl isn't among the30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
We're going to review the latest hedge fund action encompassing Sterling Bancorp (NYSE:STL).
At the end of the first quarter, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from one quarter earlier. By comparison, 17 hedge funds held shares or bullish call options in STL a year ago. So, let's review which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
Among these funds,Citadel Investment Groupheld the most valuable stake in Sterling Bancorp (NYSE:STL), which was worth $139.7 million at the end of the first quarter. On the second spot was Diamond Hill Capital which amassed $60 million worth of shares. Moreover, Millennium Management, EJF Capital, and Azora Capital were also bullish on Sterling Bancorp (NYSE:STL), allocating a large percentage of their portfolios to this stock.
With a general bullishness amongst the heavyweights, key money managers have been driving this bullishness.Element Capital Management, managed by Jeffrey Talpins, initiated the most outsized position in Sterling Bancorp (NYSE:STL). Element Capital Management had $0.6 million invested in the company at the end of the quarter. Michael Platt and William Reeves'sBlueCrest Capital Mgmt.also initiated a $0.5 million position during the quarter. The other funds with new positions in the stock are Joel Greenblatt'sGotham Asset Managementand Andrew Feldstein and Stephen Siderow'sBlue Mountain Capital.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as Sterling Bancorp (NYSE:STL) but similarly valued. We will take a look at United States Cellular Corporation (NYSE:USM), Wright Medical Group N.V. (NASDAQ:WMGI), Amedisys Inc (NASDAQ:AMED), and IBERIABANK Corporation (NASDAQ:IBKC). This group of stocks' market values resemble STL's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position USM,14,183392,-3 WMGI,35,889529,2 AMED,26,295842,-6 IBKC,26,194750,2 Average,25.25,390878,-1.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 25.25 hedge funds with bullish positions and the average amount invested in these stocks was $391 million. That figure was $469 million in STL's case. Wright Medical Group N.V. (NASDAQ:WMGI) is the most popular stock in this table. On the other hand United States Cellular Corporation (NYSE:USM) is the least popular one with only 14 bullish hedge fund positions. Sterling Bancorp (NYSE:STL) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on STL as the stock returned 6.3% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About BioDelivery Sciences International, Inc. (BDSI)
The market has been volatile in the last 6 months as the Federal Reserve continued its rate hikes and then abruptly reversed its stance and uncertainty looms over trade negotiations with China. Small cap stocks have been hit hard as a result, as the Russell 2000 ETF (IWM) has underperformed the larger S&P 500 ETF (SPY) by nearly 9 percentage points. SEC filings and hedge fund investor letters indicate that the smart money seems to be paring back their overall long exposure since summer months, though some funds increased their exposure dramatically at the end of Q4 and the beginning of Q1. In this article, we analyze what the smart money thinks of BioDelivery Sciences International, Inc. (NASDAQ:BDSI) and find out how it is affected by hedge funds' moves.
BioDelivery Sciences International, Inc. (NASDAQ:BDSI)was in 18 hedge funds' portfolios at the end of March. BDSI investors should pay attention to an increase in hedge fund sentiment recently. There were 15 hedge funds in our database with BDSI holdings at the end of the previous quarter. Our calculations also showed that BDSI isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We're going to take a gander at the key hedge fund action regarding BioDelivery Sciences International, Inc. (NASDAQ:BDSI).
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 20% from the fourth quarter of 2018. On the other hand, there were a total of 14 hedge funds with a bullish position in BDSI a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey,venBio Select Advisor, managed by Behzad Aghazadeh, holds the number one position in BioDelivery Sciences International, Inc. (NASDAQ:BDSI). venBio Select Advisor has a $39.4 million position in the stock, comprising 1.7% of its 13F portfolio. The second largest stake is held byBroadfin Capital, led by Kevin Kotler, holding a $23.2 million position; 4.8% of its 13F portfolio is allocated to the stock. Remaining peers with similar optimism comprise Wilmot B. Harkey and Daniel Mack'sNantahala Capital Management, David Rosen'sRubric Capital Managementand Israel Englander'sMillennium Management.
As industrywide interest jumped, some big names have jumped into BioDelivery Sciences International, Inc. (NASDAQ:BDSI) headfirst.Renaissance Technologies, managed by Jim Simons, assembled the most valuable position in BioDelivery Sciences International, Inc. (NASDAQ:BDSI). Renaissance Technologies had $2 million invested in the company at the end of the quarter. John Overdeck and David Siegel'sTwo Sigma Advisorsalso made a $1.1 million investment in the stock during the quarter. The other funds with brand new BDSI positions are Gavin Saitowitz and Cisco J. del Valle'sSpringbok Capital, Andrew Weiss'sWeiss Asset Management, and Mike Vranos'sEllington.
Let's also examine hedge fund activity in other stocks - not necessarily in the same industry as BioDelivery Sciences International, Inc. (NASDAQ:BDSI) but similarly valued. We will take a look at The Lovesac Company (NASDAQ:LOVE), Nam Tai Property Inc (NYSE:NTP), IES Holdings, Inc. (NASDAQ:IESC), and Old Second Bancorp Inc. (NASDAQ:OSBC). This group of stocks' market values are similar to BDSI's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position LOVE,8,30396,1 NTP,5,46107,-1 IESC,5,235210,0 OSBC,12,32129,2 Average,7.5,85961,0.5 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 7.5 hedge funds with bullish positions and the average amount invested in these stocks was $86 million. That figure was $124 million in BDSI's case. Old Second Bancorp Inc. (NASDAQ:OSBC) is the most popular stock in this table. On the other hand Nam Tai Property Inc (NYSE:NTP) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks BioDelivery Sciences International, Inc. (NASDAQ:BDSI) is more popular among hedge funds. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately BDSI wasn't nearly as popular as these 20 stocks and hedge funds that were betting on BDSI were disappointed as the stock returned -20% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Laredo Petroleum Inc (LPI)
Hedge funds and large money managers usually invest with a focus on the long-term horizon and, therefore, short-lived dips or bumps on the charts, usually don't make them change their opinion towards a company. This time it may be different. During the fourth quarter of 2018 we observed increased volatility and small-cap stocks underperformed the market. Things completely reversed during the first quarter. Hedge fund investor letters indicated that they are cutting their overall exposure, closing out some position and doubling down on others. Let’s take a look at the hedge fund sentiment towards Laredo Petroleum Inc (NYSE:LPI) to find out whether it was one of their high conviction long-term ideas.
Laredo Petroleum Inc (NYSE:LPI)was in 18 hedge funds' portfolios at the end of the first quarter of 2019. LPI investors should pay attention to an increase in hedge fund sentiment in recent months. There were 14 hedge funds in our database with LPI positions at the end of the previous quarter. Our calculations also showed that LPI isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
[caption id="attachment_746893" align="aligncenter" width="473"]
Paul Marshall of Marshall Wace[/caption]
We're going to take a look at the recent hedge fund action regarding Laredo Petroleum Inc (NYSE:LPI).
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey were long this stock, a change of 29% from one quarter earlier. On the other hand, there were a total of 15 hedge funds with a bullish position in LPI a year ago. With hedge funds' capital changing hands, there exists an "upper tier" of noteworthy hedge fund managers who were increasing their holdings significantly (or already accumulated large positions).
According to Insider Monkey's hedge fund database, MacKenzie B. Davis and Kenneth L. Settles Jr'sSailingStone Capital Partnershas the most valuable position in Laredo Petroleum Inc (NYSE:LPI), worth close to $115.7 million, amounting to 7.6% of its total 13F portfolio. The second largest stake is held byMillennium Management, led by Israel Englander, holding a $14 million position; less than 0.1%% of its 13F portfolio is allocated to the stock. Some other peers that are bullish consist of Jim Simons'sRenaissance Technologies, Gilchrist Berg'sWater Street Capitaland Jonathan Barrett and Paul Segal'sLuminus Management.
With a general bullishness amongst the heavyweights, some big names have been driving this bullishness.Luminus Management, managed by Jonathan Barrett and Paul Segal, assembled the most valuable position in Laredo Petroleum Inc (NYSE:LPI). Luminus Management had $8.5 million invested in the company at the end of the quarter. Peter Rathjens, Bruce Clarke and John Campbell'sArrowstreet Capitalalso initiated a $3.3 million position during the quarter. The other funds with new positions in the stock are Paul Marshall and Ian Wace'sMarshall Wace LLP, Sara Nainzadeh'sCentenus Global Management, and Dmitry Balyasny'sBalyasny Asset Management.
Let's check out hedge fund activity in other stocks similar to Laredo Petroleum Inc (NYSE:LPI). These stocks are Winmark Corporation (NASDAQ:WINA), Covia Holdings Corporation (NYSE:CVIA), Capstead Mortgage Corporation (NYSE:CMO), and Great Southern Bancorp, Inc. (NASDAQ:GSBC). All of these stocks' market caps resemble LPI's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position WINA,7,101640,-1 CVIA,5,61568,0 CMO,8,25570,-3 GSBC,12,24448,4 Average,8,53307,0 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 8 hedge funds with bullish positions and the average amount invested in these stocks was $53 million. That figure was $187 million in LPI's case. Great Southern Bancorp, Inc. (NASDAQ:GSBC) is the most popular stock in this table. On the other hand Covia Holdings Corporation (NYSE:CVIA) is the least popular one with only 5 bullish hedge fund positions. Compared to these stocks Laredo Petroleum Inc (NYSE:LPI) is more popular among hedge funds. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately LPI wasn't nearly as popular as these 20 stocks and hedge funds that were betting on LPI were disappointed as the stock returned -12.9% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Heidrick & Struggles International, Inc. (HSII)
A whopping number of 13F filings filed with U.S. Securities and Exchange Commission has been processed by Insider Monkey so that individual investors can look at the overall hedge fund sentiment towards the stocks included in their watchlists. These freshly-submitted public filings disclose money managers’ equity positions as of the end of the three-month period that ended March 31, so let’s proceed with the discussion of the hedge fund sentiment on Heidrick & Struggles International, Inc. (NASDAQ:HSII).
IsHeidrick & Struggles International, Inc. (NASDAQ:HSII)a buy, sell, or hold? Investors who are in the know are taking a bearish view. The number of bullish hedge fund positions retreated by 4 lately. Our calculations also showed that HSII isn't among the30 most popular stocks among hedge funds.
Why do we pay any attention at all to hedge fund sentiment? Our research has shown that hedge funds' large-cap stock picks indeed failed to beat the market between 1999 and 2016. However, we were able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that'll significantly underperform the market. We have been tracking and sharing the list of these stocks since February 2017 and they lost 30.9% through May 30, 2019. That's why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to.
Let's take a glance at the fresh hedge fund action surrounding Heidrick & Struggles International, Inc. (NASDAQ:HSII).
At the end of the first quarter, a total of 18 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of -18% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards HSII over the last 15 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to Insider Monkey's hedge fund database,Renaissance Technologies, managed by Jim Simons, holds the number one position in Heidrick & Struggles International, Inc. (NASDAQ:HSII). Renaissance Technologies has a $44.6 million position in the stock, comprising less than 0.1%% of its 13F portfolio. The second most bullish fund manager isRoyce & Associates, led by Chuck Royce, holding a $22.4 million position; 0.2% of its 13F portfolio is allocated to the stock. Some other professional money managers with similar optimism include Noam Gottesman'sGLG Partners, Paul Marshall and Ian Wace'sMarshall Wace LLPand D. E. Shaw'sD E Shaw.
Since Heidrick & Struggles International, Inc. (NASDAQ:HSII) has faced falling interest from the smart money, it's easy to see that there were a few funds who were dropping their positions entirely by the end of the third quarter. Intriguingly, David Harding'sWinton Capital Managementdropped the largest stake of all the hedgies tracked by Insider Monkey, comprising an estimated $4.9 million in call options. Matthew Hulsizer's fund,PEAK6 Capital Management, also dumped its call options, about $0.4 million worth. These moves are important to note, as total hedge fund interest dropped by 4 funds by the end of the third quarter.
Let's check out hedge fund activity in other stocks similar to Heidrick & Struggles International, Inc. (NASDAQ:HSII). We will take a look at Entercom Communications Corp. (NYSE:ETM), Dermira Inc (NASDAQ:DERM), Century Communities, Inc (NYSE:CCS), and Extraction Oil & Gas, Inc. (NASDAQ:XOG). This group of stocks' market values resemble HSII's market value.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ETM,21,95501,5 DERM,24,202565,8 CCS,16,197409,1 XOG,20,130068,-2 Average,20.25,156386,3 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 20.25 hedge funds with bullish positions and the average amount invested in these stocks was $156 million. That figure was $132 million in HSII's case. Dermira Inc (NASDAQ:DERM) is the most popular stock in this table. On the other hand Century Communities, Inc (NYSE:CCS) is the least popular one with only 16 bullish hedge fund positions. Heidrick & Struggles International, Inc. (NASDAQ:HSII) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately HSII wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); HSII investors were disappointed as the stock returned -18.4% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Semtech Corporation (SMTC)
Although the masses and most of the financial media blame hedge funds for their exorbitant fee structure and disappointing performance, these investors have proved to have great stock picking abilities over the years (that's why their assets under management continue to swell). We believe hedge fund sentiment should serve as a crucial tool of an individual investor’s stock selection process, as it may offer great insights of how the brightest minds of the finance industry feel about specific stocks. After all, these people have access to smartest analysts and expensive data/information sources that individual investors can't match. So should one consider investing in Semtech Corporation (NASDAQ:SMTC)? The smart money sentiment can provide an answer to this question.
Hedge fund interest inSemtech Corporation (NASDAQ:SMTC)shares was flat at the end of last quarter. This is usually a negative indicator. The level and the change in hedge fund popularity aren't the only variables you need to analyze to decipher hedge funds' perspectives. A stock may witness a boost in popularity but it may still be less popular than similarly priced stocks. That's why at the end of this article we will examine companies such as Glacier Bancorp, Inc. (NASDAQ:GBCI), Extended Stay America Inc (NASDAQ:STAY), and United States Steel Corporation (NYSE:X) to gather more data points.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
Let's take a look at the key hedge fund action surrounding Semtech Corporation (NASDAQ:SMTC).
Heading into the second quarter of 2019, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 0% from the fourth quarter of 2018. The graph below displays the number of hedge funds with bullish position in SMTC over the last 15 quarters. With hedge funds' sentiment swirling, there exists a select group of noteworthy hedge fund managers who were upping their stakes substantially (or already accumulated large positions).
Among these funds,Renaissance Technologiesheld the most valuable stake in Semtech Corporation (NASDAQ:SMTC), which was worth $48.1 million at the end of the first quarter. On the second spot was Millennium Management which amassed $17.6 million worth of shares. Moreover, Fisher Asset Management, Columbus Circle Investors, and Adage Capital Management were also bullish on Semtech Corporation (NASDAQ:SMTC), allocating a large percentage of their portfolios to this stock.
Seeing as Semtech Corporation (NASDAQ:SMTC) has witnessed falling interest from hedge fund managers, it's safe to say that there was a specific group of funds who were dropping their positions entirely in the third quarter. Interestingly, Steve Cohen'sPoint72 Asset Managementdropped the largest investment of all the hedgies watched by Insider Monkey, comprising close to $2.1 million in stock, and Ken Griffin's Citadel Investment Group was right behind this move, as the fund sold off about $1.9 million worth. These transactions are important to note, as total hedge fund interest stayed the same (this is a bearish signal in our experience).
Let's now review hedge fund activity in other stocks - not necessarily in the same industry as Semtech Corporation (NASDAQ:SMTC) but similarly valued. These stocks are Glacier Bancorp, Inc. (NASDAQ:GBCI), Extended Stay America Inc (NASDAQ:STAY), United States Steel Corporation (NYSE:X), and National Health Investors Inc (NYSE:NHI). This group of stocks' market valuations are closest to SMTC's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position GBCI,12,57597,2 STAY,32,522804,0 X,24,214659,0 NHI,12,120110,-1 Average,20,228793,0.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 20 hedge funds with bullish positions and the average amount invested in these stocks was $229 million. That figure was $139 million in SMTC's case. Extended Stay America Inc (NASDAQ:STAY) is the most popular stock in this table. On the other hand Glacier Bancorp, Inc. (NASDAQ:GBCI) is the least popular one with only 12 bullish hedge fund positions. Semtech Corporation (NASDAQ:SMTC) is not the least popular stock in this group but hedge fund interest is still below average. This is a slightly negative signal and we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately SMTC wasn't nearly as popular as these 20 stocks (hedge fund sentiment was quite bearish); SMTC investors were disappointed as the stock returned -19.5% during the same time period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Did Hedge Funds Drop The Ball On Axon Enterprise, Inc. (AAXN) ?
Hedge funds are known to underperform the bull markets but that's not because they are terrible at stock picking. Hedge funds underperform because their net exposure in only 40-70% and they charge exorbitant fees. No one knows what the future holds and how market participants will react to the bountiful news that floods in each day. However, hedge funds' consensus picks on average deliver market beating returns. For example in the first 5 months of this year through May 30th the Standard and Poor’s 500 Index returned approximately 12.1% (including dividend payments). Conversely, hedge funds’ top 20 large-cap stock picks generated a return of 18.7% during the same 5-month period, with the majority of these stock picks outperforming the broader market benchmark. Interestingly, an average long/short hedge fund returned only a fraction of this value due to the hedges they implemented and the large fees they charged. If you pay attention to the actual hedge fund returns versus the returns of their long stock picks, you might believe that it is a waste of time to analyze hedge funds' purchases. We know better. That's why we scrutinize hedge fund sentiment before we invest in a stock like Axon Enterprise, Inc. (NASDAQ:AAXN).
Axon Enterprise, Inc. (NASDAQ:AAXN)investors should pay attention to an increase in enthusiasm from smart money in recent months. Our calculations also showed that AAXN isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We're going to take a look at the key hedge fund action regarding Axon Enterprise, Inc. (NASDAQ:AAXN).
Heading into the second quarter of 2019, a total of 19 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 19% from the fourth quarter of 2018. On the other hand, there were a total of 17 hedge funds with a bullish position in AAXN a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
More specifically,Abdiel Capital Advisorswas the largest shareholder of Axon Enterprise, Inc. (NASDAQ:AAXN), with a stake worth $115.5 million reported as of the end of March. Trailing Abdiel Capital Advisors was Broadwood Capital, which amassed a stake valued at $41.4 million. Polar Capital, Sandler Capital Management, and Millennium Management were also very fond of the stock, giving the stock large weights in their portfolios.
As industrywide interest jumped, specific money managers were breaking ground themselves.Portolan Capital Management, managed by George McCabe, initiated the largest position in Axon Enterprise, Inc. (NASDAQ:AAXN). Portolan Capital Management had $5.4 million invested in the company at the end of the quarter. Ram Seshan Venkateswaran'sVernier Capitalalso initiated a $2.2 million position during the quarter. The other funds with new positions in the stock are Josh Goldberg'sG2 Investment Partners Management, Benjamin A. Smith'sLaurion Capital Management, and Noam Gottesman'sGLG Partners.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Axon Enterprise, Inc. (NASDAQ:AAXN) but similarly valued. We will take a look at Navistar International Corp (NYSE:NAV), RLI Corp. (NYSE:RLI), AMC Networks Inc (NASDAQ:AMCX), and Generac Holdings Inc. (NYSE:GNRC). This group of stocks' market valuations match AAXN's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position NAV,23,1335795,3 RLI,13,140748,1 AMCX,20,259491,1 GNRC,17,144727,-4 Average,18.25,470190,0.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 18.25 hedge funds with bullish positions and the average amount invested in these stocks was $470 million. That figure was $248 million in AAXN's case. Navistar International Corp (NYSE:NAV) is the most popular stock in this table. On the other hand RLI Corp. (NYSE:RLI) is the least popular one with only 13 bullish hedge fund positions. Axon Enterprise, Inc. (NASDAQ:AAXN) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on AAXN as the stock returned 25.1% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About FS KKR Capital Corp. (FSK)
Before putting in our own effort and resources into finding a good investment, we can quickly utilize hedge fund expertise to give us a quick glimpse of whether that stock could make for a good addition to our portfolios. The odds are not exactly stacked in investors' favor when it comes to beating the market, as evidenced by the fact that less than 49% of the stocks in the S&P 500 did so during the second quarter. The stats were even worse in recent years when most of the advances in the market were due to large gains by FAANG stocks. However, one bright side for individual investors was the strong performance of hedge funds' top consensus picks. This year hedge funds' top 20 stock picks outperformed the S&P 500 Index by 6.6 percentage points through May 30th. Thus, we can see that the tireless research and efforts of hedge funds to identify winning stocks can work to our advantage when we know how to use the data. While not all of their picks will be winners, our odds are much better following their best stock picks than trying to go it alone.
FS KKR Capital Corp. (NYSE:FSK)was in 19 hedge funds' portfolios at the end of the first quarter of 2019. FSK has seen a decrease in enthusiasm from smart money in recent months. There were 20 hedge funds in our database with FSK positions at the end of the previous quarter. Our calculations also showed that fsk isn't among the30 most popular stocks among hedge funds.
So, why do we pay attention to hedge fund sentiment before making any investment decisions? Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter. Even if you aren't comfortable with shorting stocks, you should at least avoid initiating long positions in our short portfolio.
Let's take a gander at the recent hedge fund action surrounding FS KKR Capital Corp. (NYSE:FSK).
At the end of the first quarter, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of -5% from the previous quarter. Below, you can check out the change in hedge fund sentiment towards FSK over the last 15 quarters. With hedge funds' positions undergoing their usual ebb and flow, there exists a few key hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
More specifically,Beach Point Capital Managementwas the largest shareholder of FS KKR Capital Corp. (NYSE:FSK), with a stake worth $99.1 million reported as of the end of March. Trailing Beach Point Capital Management was HBK Investments, which amassed a stake valued at $46.5 million. Citadel Investment Group, Almitas Capital, and McKinley Capital Management were also very fond of the stock, giving the stock large weights in their portfolios.
Judging by the fact that FS KKR Capital Corp. (NYSE:FSK) has faced declining sentiment from hedge fund managers, it's easy to see that there was a specific group of money managers that decided to sell off their positions entirely in the third quarter. At the top of the heap, Peter Rathjens, Bruce Clarke and John Campbell'sArrowstreet Capitaldumped the biggest position of all the hedgies tracked by Insider Monkey, valued at an estimated $10.1 million in stock, and Andrew Weiss's Weiss Asset Management was right behind this move, as the fund dropped about $4 million worth. These moves are intriguing to say the least, as total hedge fund interest was cut by 1 funds in the third quarter.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as FS KKR Capital Corp. (NYSE:FSK) but similarly valued. These stocks are Apergy Corporation (NYSE:APY), Manchester United PLC (NYSE:MANU), RBC Bearings Incorporated (NASDAQ:ROLL), and Tempur Sealy International Inc. (NYSE:TPX). This group of stocks' market valuations are closest to FSK's market valuation.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position APY,12,126003,-1 MANU,11,51988,2 ROLL,11,55043,5 TPX,29,1175502,-2 Average,15.75,352134,1 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 15.75 hedge funds with bullish positions and the average amount invested in these stocks was $352 million. That figure was $202 million in FSK's case. Tempur Sealy International Inc. (NYSE:TPX) is the most popular stock in this table. On the other hand Manchester United PLC (NYSE:MANU) is the least popular one with only 11 bullish hedge fund positions. FS KKR Capital Corp. (NYSE:FSK) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on FSK, though not to the same extent, as the stock returned -0.8% during the same time frame and outperformed the market as well.
Disclosure: None. This article was originally published atInsider Monkey.
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Here’s What Hedge Funds Think About Valmont Industries, Inc. (VMI)
Out of thousands of stocks that are currently traded on the market, it is difficult to identify those that will really generate strong returns. Hedge funds and institutional investors spend millions of dollars on analysts with MBAs and PhDs, who are industry experts and well connected to other industry and media insiders on top of that. Individual investors can piggyback the hedge funds employing these talents and can benefit from their vast resources and knowledge in that way. We analyze quarterly 13F filings of nearly 750 hedge funds and, by looking at the smart money sentiment that surrounds a stock, we can determine whether it has the potential to beat the market over the long-term. Therefore, let’s take a closer look at what smart money thinks about Valmont Industries, Inc. (NYSE:VMI).
IsValmont Industries, Inc. (NYSE:VMI)a splendid investment today? Prominent investors are in an optimistic mood. The number of bullish hedge fund positions rose by 1 in recent months. Our calculations also showed that vmi isn't among the30 most popular stocks among hedge funds.
Hedge funds' reputation as shrewd investors has been tarnished in the last decade as their hedged returns couldn't keep up with the unhedged returns of the market indices. Our research has shown that hedge funds' small-cap stock picks managed to beat the market by double digits annually between 1999 and 2016, but the margin of outperformance has been declining in recent years. Nevertheless, we were still able to identify in advance a select group of hedge fund holdings that outperformed the market by 40 percentage points since May 2014 through May 30, 2019 (see the details here). We were also able to identify in advance a select group of hedge fund holdings that underperformed the market by 10 percentage points annually between 2006 and 2017. Interestingly the margin of underperformance of these stocks has been increasing in recent years. Investors who are long the market and short these stocks would have returned more than 27% annually between 2015 and 2017. We have been tracking and sharing the list of these stocks since February 2017 in our quarterly newsletter.
We're going to take a peek at the fresh hedge fund action encompassing Valmont Industries, Inc. (NYSE:VMI).
At Q1's end, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 6% from the fourth quarter of 2018. On the other hand, there were a total of 21 hedge funds with a bullish position in VMI a year ago. With the smart money's positions undergoing their usual ebb and flow, there exists an "upper tier" of notable hedge fund managers who were increasing their stakes significantly (or already accumulated large positions).
More specifically,Impax Asset Managementwas the largest shareholder of Valmont Industries, Inc. (NYSE:VMI), with a stake worth $95.7 million reported as of the end of March. Trailing Impax Asset Management was Royce & Associates, which amassed a stake valued at $67.4 million. Nitorum Capital, Citadel Investment Group, and Renaissance Technologies were also very fond of the stock, giving the stock large weights in their portfolios.
Consequently, specific money managers were breaking ground themselves.First Pacific Advisors LLC, managed by Robert Rodriguez and Steven Romick, created the biggest position in Valmont Industries, Inc. (NYSE:VMI). First Pacific Advisors LLC had $3.5 million invested in the company at the end of the quarter. Noam Gottesman'sGLG Partnersalso initiated a $3.1 million position during the quarter. The other funds with brand new VMI positions are Paul Tudor Jones'sTudor Investment Corp, Matthew Hulsizer'sPEAK6 Capital Management, and Andrew Feldstein and Stephen Siderow'sBlue Mountain Capital.
Let's check out hedge fund activity in other stocks similar to Valmont Industries, Inc. (NYSE:VMI). These stocks are Holly Energy Partners, L.P. (NYSE:HEP), Canada Goose Holdings Inc. (NYSE:GOOS), Proto Labs Inc (NYSE:PRLB), and Cosan Limited (NYSE:CZZ). This group of stocks' market caps are similar to VMI's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position HEP,4,2658,2 GOOS,27,122294,-2 PRLB,11,24095,1 CZZ,16,141039,-2 Average,14.5,72522,-0.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 14.5 hedge funds with bullish positions and the average amount invested in these stocks was $73 million. That figure was $235 million in VMI's case. Canada Goose Holdings Inc. (NYSE:GOOS) is the most popular stock in this table. On the other hand Holly Energy Partners, L.P. (NYSE:HEP) is the least popular one with only 4 bullish hedge fund positions. Valmont Industries, Inc. (NYSE:VMI) is not the most popular stock in this group but hedge fund interest is still above average. This is a slightly positive signal but we'd rather spend our time researching stocks that hedge funds are piling on. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Unfortunately VMI wasn't nearly as popular as these 20 stocks and hedge funds that were betting on VMI were disappointed as the stock returned -11.1% during the same period and underperformed the market. If you are interested in investing in large cap stocks with huge upside potential, you should check out thetop 20 most popular stocksamong hedge funds as 13 of these stocks already outperformed the market so far in Q2.
Disclosure: None. This article was originally published atInsider Monkey.
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Hedge Funds Have Never Been More Bullish On Simpson Manufacturing Co, Inc. (SSD)
The government requires hedge funds and wealthy investors that crossed the $100 million equity holdings threshold are required to file a report that shows their positions at the end of every quarter. Even though it isn't the intention, these filings level the playing field for ordinary investors. The latest round of 13F filings disclosed the funds' positions on March 31. We at Insider Monkey have made an extensive database of nearly 750 of those elite funds and famous investors' filings. In this article, we analyze how these elite funds and prominent investors traded Simpson Manufacturing Co, Inc. (NYSE:SSD) based on those filings.
Simpson Manufacturing Co, Inc. (NYSE:SSD)has experienced an increase in hedge fund interest of late.SSDwas in 19 hedge funds' portfolios at the end of March. There were 17 hedge funds in our database with SSD holdings at the end of the previous quarter. Our calculations also showed that ssd isn't among the30 most popular stocks among hedge funds.
In the financial world there are many signals shareholders use to grade publicly traded companies. A duo of the less known signals are hedge fund and insider trading moves. Our researchers have shown that, historically, those who follow the top picks of the best investment managers can trounce the broader indices by a solid amount (see the details here).
Let's check out the fresh hedge fund action surrounding Simpson Manufacturing Co, Inc. (NYSE:SSD).
At Q1's end, a total of 19 of the hedge funds tracked by Insider Monkey were bullish on this stock, a change of 12% from one quarter earlier. Below, you can check out the change in hedge fund sentiment towards SSD over the last 15 quarters. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
The largest stake in Simpson Manufacturing Co, Inc. (NYSE:SSD) was held byAriel Investments, which reported holding $108.1 million worth of stock at the end of March. It was followed by Royce & Associates with a $47.7 million position. Other investors bullish on the company included Arrowstreet Capital, Millennium Management, and Renaissance Technologies.
With a general bullishness amongst the heavyweights, specific money managers have been driving this bullishness.Arrowstreet Capital, managed by Peter Rathjens, Bruce Clarke and John Campbell, created the most outsized position in Simpson Manufacturing Co, Inc. (NYSE:SSD). Arrowstreet Capital had $10.8 million invested in the company at the end of the quarter. Paul Marshall and Ian Wace'sMarshall Wace LLPalso made a $1.2 million investment in the stock during the quarter. The other funds with new positions in the stock are John Hempton'sBronte Capital, Benjamin A. Smith'sLaurion Capital Management, and Jeffrey Talpins'sElement Capital Management.
Let's also examine hedge fund activity in other stocks similar to Simpson Manufacturing Co, Inc. (NYSE:SSD). These stocks are Adtalem Global Education Inc. (NYSE:ATGE), Cactus, Inc. (NYSE:WHD), Quaker Chemical Corp (NYSE:KWR), and Avista Corp (NYSE:AVA). This group of stocks' market caps are similar to SSD's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position ATGE,16,175755,-4 WHD,27,291995,9 KWR,11,145447,-2 AVA,18,176178,0 Average,18,197344,0.75 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 18 hedge funds with bullish positions and the average amount invested in these stocks was $197 million. That figure was $199 million in SSD's case. Cactus, Inc. (NYSE:WHD) is the most popular stock in this table. On the other hand Quaker Chemical Corp (NYSE:KWR) is the least popular one with only 11 bullish hedge fund positions. Simpson Manufacturing Co, Inc. (NYSE:SSD) is not the most popular stock in this group but hedge fund interest is still above average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. Hedge funds were also right about betting on SSD as the stock returned 4.3% during the same period and outperformed the market by an even larger margin. Hedge funds were rewarded for their relative bullishness.
Disclosure: None. This article was originally published atInsider Monkey.
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Mark-Paul Gosselaar joins 'Black-ish' spinoff 'Mixed-ish'
Mark-Paul Gosselaar is heading to ABC’s incoming comedy mixed-ish , EW has confirmed. The show, which is a prequel spin-off of black-ish , follows Rainbow Johnson as she recounts her experience growing up in a mixed-race family in the ‘80s. Gosselaar will take on the role of Rainbow’s father from Anders Holm, who played the part in the original pilot. In black-ish , a grown version of Rainbow is played by Tracee Ellis Ross. Mixed-ish will star The Haves and the Have Nots ‘ Tika Sumpter as young Rainbow’s mom. Young Bow will be played by Arica Himmel, who recently appeared on CBS’s God Friended Me. The new series will also feature Veep actor Gary Cole as Bow’s paternal grandfather, as well as Ethan William Childress, Mykal-Michelle Harris, and Christina Anthony. The show was initially conceived as a special episode of black-ish that would air May 7, but ABC later said it would be held for next season. Holm played Bow’s father in that episode. Gosselaar, who first shot to fame on Saved by the Bell , has since had roles on shows such as NYPD Blue, Raising the Bar, Pitch, and The Passage. Mixed-ish is set to air Tuesdays this fall on ABC. Related content: black-ish gets a season 6 — and a new prequel spin-off mixed-ish on ABC See ABC’s fall 2019-2020 prime-time schedule |
Is Acadia Healthcare Company Inc (ACHC) A Good Stock To Buy?
Russell 2000 ETF (IWM) lagged the larger S&P 500 ETF (SPY) by nearly 9 percentage points since the end of the third quarter of 2018 as investors worried over the possible ramifications of rising interest rates and escalation of the trade war with China. The hedge funds and institutional investors we track typically invest more in smaller-cap stocks than an average investor (i.e. only 298 S&P 500 constituents were among the 500 most popular stocks among hedge funds), and we have seen data that shows those funds paring back their overall exposure. Those funds cutting positions in small-caps is one reason why volatility has increased. In the following paragraphs, we take a closer look at what hedge funds and prominent investors think of Acadia Healthcare Company Inc (NASDAQ:ACHC) and see how the stock is affected by the recent hedge fund activity.
Acadia Healthcare Company Inc (NASDAQ:ACHC)was in 19 hedge funds' portfolios at the end of March. ACHC investors should be aware of an increase in enthusiasm from smart money of late. There were 18 hedge funds in our database with ACHC positions at the end of the previous quarter. Our calculations also showed that achc isn't among the30 most popular stocks among hedge funds.
In the 21st century investor’s toolkit there are many tools stock traders employ to analyze their stock investments. Two of the most underrated tools are hedge fund and insider trading activity. Our researchers have shown that, historically, those who follow the best picks of the top hedge fund managers can beat the market by a very impressive amount (see the details here).
Let's check out the fresh hedge fund action encompassing Acadia Healthcare Company Inc (NASDAQ:ACHC).
Heading into the second quarter of 2019, a total of 19 of the hedge funds tracked by Insider Monkey were long this stock, a change of 6% from the fourth quarter of 2018. On the other hand, there were a total of 16 hedge funds with a bullish position in ACHC a year ago. So, let's find out which hedge funds were among the top holders of the stock and which hedge funds were making big moves.
According to publicly available hedge fund and institutional investor holdings data compiled by Insider Monkey,Elliott Management, managed by Paul Singer, holds the largest position in Acadia Healthcare Company Inc (NASDAQ:ACHC). Elliott Management has a $127.5 million position in the stock, comprising 0.8% of its 13F portfolio. The second largest stake is held byP2 Capital Partners, managed by Claus Moller, which holds a $125.4 million position; 10.4% of its 13F portfolio is allocated to the stock. Other peers that are bullish consist of William Leland Edwards'sPalo Alto Investors, Didric Cederholm'sLion Pointand Kris Jenner, Gordon Bussard, Graham McPhail'sRock Springs Capital Management.
As industrywide interest jumped, key money managers have jumped into Acadia Healthcare Company Inc (NASDAQ:ACHC) headfirst.Palo Alto Investors, managed by William Leland Edwards, created the most valuable position in Acadia Healthcare Company Inc (NASDAQ:ACHC). Palo Alto Investors had $60.4 million invested in the company at the end of the quarter. Joseph Mathias'sConcourse Capital Managementalso initiated a $3.6 million position during the quarter. The other funds with brand new ACHC positions are Manoj JaináandáSohit Khurana'sMaso Capital, Brandon Haley'sHolocene Advisors, and Alec Litowitz and Ross Laser'sMagnetar Capital.
Let's go over hedge fund activity in other stocks - not necessarily in the same industry as Acadia Healthcare Company Inc (NASDAQ:ACHC) but similarly valued. We will take a look at Emergent Biosolutions Inc (NYSE:EBS), Mirati Therapeutics, Inc. (NASDAQ:MRTX), Genomic Health, Inc. (NASDAQ:GHDX), and Quidel Corporation (NASDAQ:QDEL). This group of stocks' market caps resemble ACHC's market cap.
[table] Ticker, No of HFs with positions, Total Value of HF Positions (x1000), Change in HF Position EBS,11,185718,-5 MRTX,28,950980,1 GHDX,25,1054605,1 QDEL,18,119938,2 Average,20.5,577810,-0.25 [/table]
View table hereif you experience formatting issues.
As you can see these stocks had an average of 20.5 hedge funds with bullish positions and the average amount invested in these stocks was $578 million. That figure was $463 million in ACHC's case. Mirati Therapeutics, Inc. (NASDAQ:MRTX) is the most popular stock in this table. On the other hand Emergent Biosolutions Inc (NYSE:EBS) is the least popular one with only 11 bullish hedge fund positions. Acadia Healthcare Company Inc (NASDAQ:ACHC) is not the least popular stock in this group but hedge fund interest is still below average. Our calculations showed thattop 20 most popular stocksamong hedge funds returned 1.9% in Q2 through May 30th and outperformed the S&P 500 ETF (SPY) by more than 3 percentage points. A small number of hedge funds were also right about betting on ACHC as the stock returned 12% during the same time frame and outperformed the market by an even larger margin.
Disclosure: None. This article was originally published atInsider Monkey.
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Those Who Purchased Rollatainers (NSE:ROLLT) Shares A Year Ago Have A 50% Loss To Show For It
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The simplest way to benefit from a rising market is to buy an index fund. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. For example, theRollatainers Limited(NSE:ROLLT) share price is down 50% in the last year. That contrasts poorly with the market return of 0.2%. Rollatainers may have better days ahead, of course; we've only looked at a one year period. Shareholders have had an even rougher run lately, with the share price down 20% in the last 90 days.
Check out our latest analysis for Rollatainers
Because Rollatainers is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn't make profits, we'd generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In just one year Rollatainers saw its revenue fall by 16%. That's not what investors generally want to see. Shareholders have seen the share price drop 50% in that time. That seems pretty reasonable given the lack of both profits and revenue growth. We think most holders must believe revenue growth will improve, or else costs will decline.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
You can see how its balance sheet has strengthened (or weakened) over time in thisfreeinteractive graphic.
While Rollatainers shareholders are down 50% for the year, the market itself is up 0.2%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. The share price decline has continued throughout the most recent three months, down 20%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Shareholders might want to examinethis detailed historical graphof past earnings, revenue and cash flow.
Of courseRollatainers may not be the best stock to buy. So you may wish to see thisfreecollection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Royal Bank of Scotland Onboards Former Circle Exec to Head Fintech Project
The RoybalBankofScotland(RBS) has hired a former executive fromcryptocurrencyfinance firmCircle, according to areportby the Financial Times on June 18.
Marieke Flament, who formerly worked as the European managing director of Circle, will reportedly join RBS as CEO of Mettle, its digital service for small and medium-sized enterprises (SMEs).
Mettle has reportedly been operational since November 2018, and RBS is aiming to roll out a standalone version of the service in August. Flament commented on potential for financial disruption in the SME sector with Mettle, saying:
“There is a huge opportunity for disruption in SME digital banking. Insight and feedback garnered during the pilot stage have shown that we are in a very strong position to capitalize on this opportunity through Mettle.”
As previouslyreportedby Cointelegraph, the Royal Bank of Scotland joined a trial program in April that usedblockchaintech to streamline real estate payments. The trial reportedly used a tool from startup Instant Property Network — based onR3’sopen sourceplatformCorda— to cut costs and offer more transparency in property acquisitions.
Executive John Stecher atBarclays, another major bank participating in the trial, commented on the current un-streamlined process of buying a house, saying:
“When a person wants to purchase a house, the process encompasses a whole host of different interactions with different businesses and governmental entities that can be uncomfortable and drawn out.”
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Dollar on defensive after Fed signals readiness to cut rates
By Shinichi Saoshiro
TOKYO (Reuters) - The dollar was on the defensive on Thursday after the Federal Reserve signalled it was ready to lower interest rates to combat growing global and domestic risks.
The Fed on Wednesday left interest rates unchanged as widely expected but said the case for lower rates was building, suggesting it could ease monetary policy as early as next month as it took stock of rising trade tensions and growing concerns about weak inflation.
The dollar index against a basket of six major currencies was little changed at 97.188 after losing more than 0.5% overnight.
"Even though the market had anticipated much of what the Fed said, the dollar's fall was still a relatively large one," said Daisuke Karakama, chief market economist at Mizuho Bank.
"The main question is no longer if the Fed will cut rates in July, but whether the easing will be by 25 or 50 basis points."
With U.S. yields falling after the Fed meeting, the dollar retreated against the yen. The two-year Treasury yield touched 1.737% on Wednesday, its lowest level since November 2017.
The greenback lost more than 0.3% to brush 107.720 yen, its lowest since Jan. 4, coming under further pressure after Bloomberg reported that U.S. President Donald Trump believes that he has the authority to replace Fed Chair Jerome Powell and demote him to be a board governor.
Immediate focus for the yen was on the Bank of Japan's monetary policy decision due later on Thursday.
The BOJ is expected to keep its ultra-loose monetary policy unchanged but interest in markets will be on whether the Fed's dovish tilt would have any bearing on its Japanese counterpart.
The euro stretched overnight gains and advanced 0.2% to $1.1248.
The common currency has managed to bounce off a two-week low of $1.1181 set earlier in the week after European Central Bank President Mario Draghi's dovish comments sent German bund yields to record lows.
The pound was steady at $1.2652 after gaining roughly 0.7% overnight.
Sterling was buoyant ahead of the Bank of England's policy meeting later on Thursday, where the central bank may strike a relatively more confident tone than its peers. [GBP/]
In contrast with the general caution displayed by other major global central banks, the BoE is expected to repeat its intention of raising borrowing costs - Brexit permitting.
The Australian dollar was a touch higher at $0.6885 following a modest gain of 0.1% on Wednesday.
(Editing by Shri Navaratnam) |
Dollar slides, posting biggest two-day drop in a year
By Kate Duguid
NEW YORK (Reuters) - The U.S. dollar sank against its rivals on Thursday, posting its biggest two-day drop in a year a day after the Federal Reserve signaled it was ready to cut interest rates as early as next month.
The Fed joined global peers such as the European Central Bank and the Reserve Bank of Australia this week in indicating that more policy stimulus is needed to maintain economic growth. That fueled big gains in higher-yielding currencies such as the New Zealand, Australian and Canadian dollars.
"Certainly the market has taken this as a dovish turn and as a reason to sell dollars," said Lee Ferridge, head of macro strategy for North America for State Street Global Markets. "The theme of the day is going to stay with the dollar under pressure."
The dollar fell 0.47% against a basket of its rivals to 96.66 for the biggest two-day loss since February 2018. It retreated to a six-month low against the Japanese yen at 107.24, down approximately 0.78%.
The sharp fall in the dollar took currency markets by surprise and forced some hedge funds that had built up large long-dollar bets before the Fed's policy statement to dump the greenback.
The dollar came under additional pressure after benchmark 10-year Treasury yields slid to the lowest level in 2-1/2 years.
The widespread dollar weakness boosted appetite for risk-oriented currencies, with the euro running past the $1.13 line to a one-week high, last up 0.62% at $1.129. The Australian and New Zealand dollars gained 0.61% and 0.80%, respectively.
Although the dollar looks weaker in the short term, some investors were skeptical the trend would hold.
For "the high-beta currencies - the Aussie dollar, the kiwi, the Canadian dollar - and the EM currencies, I would be wary of moving into this and thinking this trend is going to last. For the Fed to deliver what the market is pricing in, things have to get worse, and that's bad for high-beta and EM," Ferridge said.
Expectations rose for a Fed rate cut, with money markets pricing in three rate cuts before the end of the year and as many as five cuts through mid-2020.
Ferridge, however, said that Fed Chair Jerome Powell did not do all that some investors were expecting.
"Yes, (Powell) opened the door to a July cut. That's pretty much a done deal. But he didn't set the groundwork for the other cuts the market was expecting," Ferridge said.
Graphic - World FX rates in 2019, click http://tmsnrt.rs/2egbfVh
(Reporting by Kate Duguid; Additional reporting by Saikat Chatterjee; Editing by Paul Simao and Leslie Adler) |
'He is out of step': Backlash after Biden talks 'civility' with segregationist senators
WASHINGTON Former Vice President Joe Biden reflected Tuesday on the "civility" that existed between himself and segregationist senators early in his career in an effort to present himself as a bipartisan consensus-maker. The 2020 Democratic presidential candidate, who has found himself a front-runner in recent polls, drew criticism for the remarks. Speaking at a fundraiser at the ritzy Carlyle Hotel in New York, Biden talked about his ability to "(get) things done" with former Senators James Eastland of Mississippi and Herman Talmadge of Georgia, according to a campaign pool report. The two segregationist Democrats fought against the civil rights movement and opposed the racial integration of schools. Biden's first term in the Senate, which started in 1973, overlapped with the tenures of the two men. Biden also lamented a political climate that would not allow for similar "consensus" today. "I know the new New Left tells me that Im this is old-fashioned," he said. "Well guess what? If we cant reach a consensus in our system, what happens? It encourages and demands the abuse of power by a president. Thats what it does. You have to be able to reach consensus under our system our Constitutional system of separation of powers. Poll: Biden, Sanders lead Trump in Florida More: Joe Biden visits Stonewall Inn in NYC Biden then went on to cite his relationships with Eastland and Talmadge as examples of people who "didn't agree on much of anything" but "got things done." I was in a caucus with James O. Eastland, said Biden, reportedly imitating Eastland's southern drawl. He never called me 'boy,' he always called me 'son.' Talmadge, he said, was "one of the meanest guys I ever knew." But according to Biden, despite these differences, "At least there was some civility. We got things done. We didnt agree on much of anything. We got things done. We got it finished. But today, you look at the other side and youre the enemy. Not the opposition, the enemy. We don't talk to each other anymore. Story continues Eastland and Talmadge were ardent segregationists. After Brown v. Board of Education was decided by the Supreme Court in 1954, according to a 2007 Atlantic article, Eastland said that "the Southern institution of racial segregation or racial separation was the correct, self-evident truth which arose from the chaos and confusion of the Reconstruction period. Separation promotes racial harmony. It permits each race to follow its own pursuits, and its own civilization. Segregation is not discrimination" Journalist Paul Mayhew, describing Talmadge in a 1956 New Republic article , said, "No Senator from the South is so well equipped or so zealous to become the head and front of a sustained fight for segregation." Biden's comments, once reported on by the Washington Post, drew outrage online. Connie Schultz, a Pulitzer Prize-winning journalist who is married to Sen. Sherrod Brown, D-Ohio, slammed Biden for his comments. "There is no punchline here, no emoji or funny meme to soften the harm of your words. That segregationist never called you 'boy' because you are white. If you want to boast about your relationship with a racist, you are not who we need to succeed the racist in the White House," Schultz wrote. There is no punchline here, no emoji or funny meme to soften the harm of your words. That segregationist never called you boy because you are white. If you want to boast about your relationship with a racist, you are not who we need to succeed the racist in the White House. https://t.co/gULBDb9kMp Connie Schultz (@ConnieSchultz) June 19, 2019 Jamelle Bouie, a New York Times opinion columnist, noted that "it may have been necessary to work with segregationists but theres nothing laudable about it. It may have been necessary to work with segregationists but theres nothing laudable about it. b-boy bouiebaisse (@jbouie) June 19, 2019 Almost the entire Democratic presidential candidate field is going to South Carolina this weekend to court voters at the South Carolina Democratic Convention and Rep. Jim Clyburn's fish fry. South Carolina's Democratic electorate is about 60% African American. Clyburn, a former chairman of the Congressional Black Caucus, defended Biden on Wednesday afternoon. According to Politico's Jake Sherman, Clyburn said that his own work with Sen. Strom Thurmond, who filibustered the Civil Rights Act of 1957 was similar to Biden working with Talmadge." Vice's Daniel Newhauser reported that Clyburn told reporters, "So what? Do you know how many times Ive been called the N word and worse?" Some Democratic contenders criticized Biden for his remarks. New York City Mayor Bill de Blasio, a Democratic presidential candidate, weighed in, calling Biden "out of step" with the modern Democratic Party. "Its 2019 & @JoeBiden is longing for the good old days of 'civility' typified by James Eastland,'" wrote de Blasio. Its 2019 & @JoeBiden is longing for the good old days of civility typified by James Eastland. Eastland thought my multiracial family should be illegal & that whites were entitled to the pursuit of dead n*ggers." (1/2) pic.twitter.com/yoOOkpaTX2 Bill de Blasio (@BilldeBlasio) June 19, 2019 And in a press release, Sen. Cory Booker D-N.J., called on Biden to apologize. "Vice President Bidens relationships with proud segregationists are not the model for how we make America a safer and more inclusive place for black people, and for everyone. I have to tell Vice President Biden, as someone I respect, that he is wrong for using his relationships with Eastland and Talmadge as examples of how to bring our country together," said Booker. More: Like what youre reading? Download the USA TODAY app for more This article originally appeared on USA TODAY: 'He is out of step': Backlash after Biden talks 'civility' with segregationist senators |
Is Max Ventures and Industries Limited's (NSE:MAXVIL) CEO Paid At A Competitive Rate?
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Sahil Vachani became the CEO of Max Ventures and Industries Limited (NSE:MAXVIL) in 2016. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Max Ventures and Industries
Our data indicates that Max Ventures and Industries Limited is worth ₹6.3b, and total annual CEO compensation is ₹22m. (This is based on the year to March 2018). We think total compensation is more important but we note that the CEO salary is lower, at ₹9.5m. We took a group of companies with market capitalizations below ₹14b, and calculated the median CEO total compensation to be ₹1.3m.
It would therefore appear that Max Ventures and Industries Limited pays Sahil Vachani more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Max Ventures and Industries has changed over time.
On average over the last three years, Max Ventures and Industries Limited has shrunk earnings per share by 90% each year (measured with a line of best fit). It achieved revenue growth of 27% over the last year.
The reduction in earnings per share, over three years, is arguably concerning. But on the other hand, revenue growth is strong, suggesting a brighter future. In conclusion we can't form a strong opinion about business performance yet; but it's one worth watching. We don't have analyst forecasts, but you might want to assessthis data-rich visualizationof earnings, revenue and cash flow.
With a three year total loss of 6.1%, Max Ventures and Industries Limited would certainly have some dissatisfied shareholders. This suggests it would be unwise for the company to pay the CEO too generously.
We compared the total CEO remuneration paid by Max Ventures and Industries Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Although we'd stop short of calling it inappropriate, we think the CEO compensation is probably more on the generous side of things. If you think CEO compensation levels are interesting you will probably really likethis free visualization of insider trading at Max Ventures and Industries.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
What to Expect From Slack's Direct Listing
It may be psychologically pleasing to see shares of a company rise during itsfirst day of tradingfollowing an initial public offering.
Butin the case of a direct listing, investors might see the stock hit its high at the start of the day before sliding back down, said Joe Mecane, head of execution services at Citadel Securities duringFortune’sBrainstorm Finance conference in Montauk, N.Y.
That’s exactly what may happen with workplace messaging application Slack, which is set to start trading as a direct listing on theNew York Stock Exchange as “WORK” Thursday, with a price of around $26 a share.
In a typical IPO, underwriters build a book of buyers and sellers and are expected to stabilize shares of a company for a period after it debuts.
In the case of a direct listing, the underwriters are cut out. Instead, the market maker is expected to figure out supply and demand on the day of the listing. But since all shares sold come from existing shareholders, supply volume isn’t immediately clear. Citadel Securities is Slack’s market maker.
“In a normal IPO, you’re more worried about buyers than sellers showing up,” Mecane said. But in the case of a direct listing, the selling shareholders “will often just wait because they want to see what is going to happen. In which case you can end up in a situation where you have buyers showing up, but you’re not quite sure whether or not the supply is in the market.”
As the trading day continues, selling shareholders typically start entering the market and the balance evens out.
Although Spotify—and now Slack—have opted for direct listings, companies and investors are just beginning to understand how they operate. So Slack’s offering will be watched closely. “It could be very good for direct listings if Slack goes well,” says Leslie Pfrang, a partner at Class V Group, which advises companies going public.
Slack’s listing comes at a time when investors are wary of the ongoing China-U.S. trade war, a backdrop that certainly didn’t help Uber on itsdismal first day on the market. But, in the case of direct listings, “Market conditions matter a little bit less than in a traditional IPO,” says John Tuttle, Chief Commercial Officer at the NYSE.
—Slack is doing a direct listing instead of an IPO.What is that?
—4 things investors need to knowabout Slack’s direct listing
—Slack’s CEO was raised in a log cabin—andnow he’s worth $1.3 billion
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—Listen to our new audio briefing,Fortune500 Daily
Don’t miss the dailyTerm Sheet,Fortune‘s newsletter on deals and dealmakers. |
Oil jumps 5% on Iran tension, potential U.S. fed rate cut
By Jessica Resnick-Ault
NEW YORK (Reuters) - Oil soared more than 5% on Thursday after Iran shot down a U.S. military drone, raising fears of a military confrontation between Tehran and Washington.
Expectations that the U.S. Federal Reserve could cut interest rates at its next meeting, stimulating growth in the world's largest oil-consuming country, and a drop in U.S. crude inventories also supported prices.
"It's a confluence of events: there's a looming easing cycle which is going to hit the dollar and prop up commodity prices and there are also the tensions with Iran," said John Kilduff, a partner at Again Capital Management in New York.
The security premium built into oil prices could rise further as tensions between the U.S. and Iran heat up, he said.
Brent crude, the global benchmark, settled up $2.63, or 4.3% at $64.45 a barrel. U.S. West Texas Intermediate crude rose $2.89, or 5.4%, to $56.65 a barrel.
Brent's premium over WTI narrowed to its lowest since April. The move came as U.S. crude rose more quickly than Brent due to the tailwind provided by potential Federal Reserve policy, said Bob Yawger, director of futures at Mizuho in New York.
U.S. President Donald Trump played down Iran's downing of a U.S. military drone, saying he suspected it was shot by mistake and that "it would have made a big difference" to him if the remotely-controlled aircraft had been piloted.
While the comments appeared to suggest Trump was not eager to escalate the latest in a series of incidents with Iran, he also warned that: "This country will not stand for it."
Tehran said the unarmed Global Hawk surveillance drone was on a spy mission over its territory but Washington said it was shot down over international airspace.
Tension has been rising in the Middle East, home to over 20% of the world's oil output, after attacks on two tankers near the Strait of Hormuz, a chokepoint for oil supplies. Washington blamed Tehran for the tanker attacks. Iran denied any role.
Concern about slowing economic growth and a U.S.-China trade dispute has pulled oil lower in recent weeks. Brent reached a 2019 high of $75 in April.
The prospect of further rate cuts could prove the more significant factor for oil, said Petromatrix analyst Olivier Jakob, should Iran-U.S. tension not escalate.
"The Fed and the cutting of rates is something that will provide more substantial support," he said.
Gulf OPEC producers will keep their July oil production within their OPEC target despite the current global supply cut pact expiring at end of June, OPEC sources said, a signal that the Gulf exporters are reluctant to boost supply.
The Organization of the Petroleum Exporting Countries and allies including Russia look set to extend a deal on cutting 1.2 million barrels per day of production. The coalition known as OPEC+ agreed this week to meet on July 1-2, ending a month of wrangling about the timing.
(Additional reporting by Aaron Sheldrick and Alex Lawler; Editing by Marguerita Choy and Alexander Smith) |
Bitcoin Climbs Above 9,288.6 Level, Up 1%
Investing.com - Bitcoin rose above the $9,288.6 threshold on Thursday. Bitcoin was trading at 9,288.6 by 00:56 (04:56 GMT) on the Investing.com Index, up 1.30% on the day. It was the largest one-day percentage gain since June 19.
The move upwards pushed Bitcoin's market cap up to $165.2B, or 57.13% of the total cryptocurrency market cap. At its highest, Bitcoin's market cap was $241.2B.
Bitcoin had traded in a range of $9,228.7 to $9,345.8 in the previous twenty-four hours.
Over the past seven days, Bitcoin has seen a rise in value, as it gained 14.43%. The volume of Bitcoin traded in the twenty-four hours to time of writing was $16.0B or 30.75% of the total volume of all cryptocurrencies. It has traded in a range of $8,153.2173 to $9,438.1270 in the past 7 days.
At its current price, Bitcoin is still down 53.25% from its all-time high of $19,870.62 set on December 17, 2017.
Ethereum was last at $269.61 on the Investing.com Index, up 0.88% on the day.
XRP was trading at $0.43342 on the Investing.com Index, a gain of 0.59%.
Ethereum's market cap was last at $28.7B or 9.94% of the total cryptocurrency market cap, while XRP's market cap totaled $18.5B or 6.39% of the total cryptocurrency market value.
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Some RattanIndia Power (NSE:RTNPOWER) Shareholders Have Taken A Painful 87% Share Price Drop
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We're definitely into long term investing, but some companies are simply bad investments over any time frame. We really hate to see fellow investors lose their hard-earned money. Anyone who heldRattanIndia Power Limited(NSE:RTNPOWER) for five years would be nursing their metaphorical wounds since the share price dropped 87% in that time. We also note that the stock has performed poorly over the last year, with the share price down 55%. Furthermore, it's down 38% in about a quarter. That's not much fun for holders.
While a drop like that is definitely a body blow, money isn't as important as health and happiness.
See our latest analysis for RattanIndia Power
RattanIndia Power isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Over five years, RattanIndia Power grew its revenue at 30% per year. That's better than most loss-making companies. So it's not at all clear to us why the share price sunk 33% throughout that time. You'd have to assume the market is worried that profits won't come soon enough. We'd recommend carefully checking for indications of future growth - and balance sheet threats - before considering a purchase.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
You can see how its balance sheet has strengthened (or weakened) over time in thisfreeinteractive graphic.
Investors in RattanIndia Power had a tough year, with a total loss of 55%, against a market gain of about 0.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 33% per year over five years. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
PG&E says it's fixed many major safety risks on lines, poles
SACRAMENTO, Calif. (AP) — Pacific Gas & Electric Corp. officials said Wednesday its workers discovered more than 1,000 high-priority safety risks on its transmission lines and distribution poles over several months of inspections and almost all of them have been fixed. Some of the transmission line issues mirrored those on a line that state fire officials have blamed for starting the November wildfire that killed 85 people and nearly destroyed the town of Paradise, said Sumeet Singh, vice president of the utility's Community Wildfire Safety Program. "The number of safety risks found through these inspections is unacceptable," Singh said in a call with reporters. "When it comes to safety our work is not done." Of the roughly 100 high-risk problems found on transmission lines, about 15 to 20 percent were on the line blamed for sparking the November fire, Singh said. The utility has permanently retired the 56-mile line. About 1,000 of the high-risk problems were found on distribution poles, with 97 percent fixed. The utility identified another 100 high priority issues on its substations and said all have been fixed. PG&E has been inspecting its equipment in high-risk wildfire areas as part of a wildfire mitigation plan it was required to submit to state regulators. The utility has been blamed for sparking some of California's most destructive wildfires in recent years, and it filed for bankruptcy in January as it faced potentially tens of billions of dollars in liability. Wildfire victims, state regulators, lawmakers and Gov. Gavin Newsom have blasted the utility for its poor safety record. In addition to its equipment sparking wildfires, PG&E was criminally prosecuted in 2010 for a gas pipeline explosion that killed eight people. "PG&E has not been a good player," Democratic Assemblywoman Eloise Reyes said Tuesday during a discussion on California wildfires. Singh said the utility has drastically stepped up its equipment inspections and made them more rigorous. During a four-month period this year, the utility inspected 700,000 distribution poles, more than triple what it previously inspected in the same time frame. PG&E's inspections also revealed significant problems with a transmission line running through Golden Gate National Recreation Area. Ten of the 11 towers on the transmission line need to be completely replaced, Singh said. In total, the utility plans to spend more than $2.3 billion on inspections, vegetation management and other wildfire mitigation efforts, he said. The California Public Utilities Commission, which regulates utilities, will ultimately decide if those costs can be passed on to PG&E's customers. View comments |
Should I Use a Personal Loan to Pay for My Divorce?
When you and your spouse part ways, you need to be prepared for the price tag that goes along with the dissolution of a marriage.
Image source: Getty Images
Nolo estimates theaverage cost of divorce at around $15,000-- and that’s just for the legal fees you must pay to formally end your union. After divorce, you may also have to give up some of your savings and property to your spouse and could end up ordered to pay alimony and child support.
While divorce is expensive, the costs of having good legal representation are worth paying. The divorce settlement you reach will impact your future financial security, the property you receive, and even the time you have with your children once your marriage is over. You can’t afford to skimp when it comes to hiring a good lawyer -- but you need to find a way to pay for the cost.
Many people who are going through a divorce aren’t sure where to start when it comes to securing financing for legal expenses. For a good number of those divorcing individuals, a personal loan can be the best approach to pay for the divorce.
Personal loanscan be a good option to pay for divorce for many different reasons. Here are some of the benefits associated with using a personal loan to pay divorce costs:
• You can borrow a big sum of money:Many personal loan lenders allow you to borrow as much as $50,000 or even up to $100,000. You may have more access to funds with a personal loan while your savings or the credit limit on acredit cardwould run out sooner.
• You don’t generally need collateral:In most cases, you can find an unsecured personal loan, which means you don’t have to pledge any property as collateral. This can be beneficial in a divorce when your property may be shared marital property that’s tied up in litigation and thus can’t be pledged to guarantee a loan.
• Personal loans often have lower interest rates than other sources of funds: The interest rate on credit cards is typically higher than the interest rate on personal loans, for example.
• Personal loans have a fixed repayment schedule: You’ll know up front when your debtwill be paid offso you don’t have the uncertainty of debt hanging over your head indefinitely.
• Personal loans can be repaid over several years:It’s common for personal loans to have repayment terms of around three to five years, although some loans have shorter repayment timelines and others have longer timelines. This multi-year repayment schedule gives you plenty of time to pay back what you owe with reasonable monthly payments.
• You have control over the funds:If you borrow money in your own name after you’ve separated, your spouse has no control over what you do with those funds -- whereas using assets in shared marital savings accounts can sometimes be difficult. With a personal loan, you get the money up front from the lender and can use it to do anything you’d like, from hiring a private investor to track down missing marital assets to paying legal fees.
Because of these benefits, using a personal loan can be preferable to many other alternative sources of funding a divorce.
Of course, there are some downsides associated with using a personal loan to get a divorce.
• You have to pay interest: While the interest rate is usually lower than the standard rate on a credit card, you still have to pay interest on your debt. And, depending on how much you borrow and how long it takes to pay back the loan, the interest costs could add up to several thousand dollars. This makes your divorce even more expensive.
• Qualifying for a loan can sometimes be hard: Depending upon your income,credit score, and other debt obligations, it may be difficult for you to get a loan with a reasonable interest rate and good terms. This can be especially true if you were a stay-at-home spouse without income of your own or if you and your spouse have a lot of joint debt.
• You’re stuck borrowing a fixed amount:When you take out a personal loan, you get a fixed amount of money that you receive all at once. You can’t just request a loan increase if it turns out your divorce is more expensive than anticipated -- you’d need to apply for an entirely new loan. And, since you get all the money up front but may pay legal fees over time, you may be paying interest on borrowed money you won’t need for months.
As you consider the pros and cons of using a personal loan to pay for divorce, you also need to consider your alternatives. After all, if a personal loan is theonlyreasonable source of funds to pay for your divorce, taking a personal loan is clearly the right choice. But, if you have other options, you’ll need to compare those other solutions to getting a personal loan.
Some of your other options to fund your divorce include the following:
• Using savings:This can be tricky if you and your spouse share access to savings. But, if you can access spare funds and pay your lawyer from available cash, you can avoid having to go through the loan application process or pay interest. The downside, though, is that this savings won’t be available to set up your new life after divorce.
• Charging legal fees on a credit card:Not all lawyers allow you to charge your legal fees, but some do. If you charge your legal fees, you may have to pay a higher interest rate than you would with a personal loan -- and your credit limit may not be high enough to fully cover divorce costs. The upside is, you can borrow money as you need it and don’t have to take a big loan at once -- and could potentially request a credit line increase if it turns out you need more money. If you can get a card with a0% promotional APR, you could potentially also avoid paying interest on the money you borrow for your divorce if you can pay back what you owe within the promotional period.
• Borrowing from family: If you have family members willing to lend you money, you can also avoid applying for a loan and paying interest. Unfortunately, this could make your family relationships uncomfortable, especially if you can’t pay back the loan right away. And, your family members may feel like they get to weigh in on decisions made during your divorce if they lend you money.
As you can see, in many cases, a personal loan is a better choice than these other options -- but it will depend on your situation.
Whatever approach you choose, try to keep borrowing costs as low as possible by looking for ways to cut costs during divorce -- such as negotiating on some issues outside of court.
And, be sure to shop around for the most affordable financing possible because you don’t want to start your new single life with a bunch of costly debt hanging over your head.
The Motley Fool owns and recommends MasterCard and Visa, and recommends American Express. We’re firm believers in the Golden Rule. If we wouldn’t recommend an offer to a close family member, we wouldn’t recommend it on The Ascent either. Our number one goal is helping people find the best offers to improve their finances. That is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team. |
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After Hours: Facebook Gets a Senate Hearing, Oracle Q4 Trumps Estimates
It's a Techie Wednesday today in the after-market trading space. News about several players in the world of digital is crowding the business news headlines and moving stock prices.
The news items include a summons from a wing of the government, a quarter that well exceeded projections, and a company that's about to make its debut on the stock exchange. Read on for details.
Facebook's (NASDAQ: FB) plans to mint a digital cryptocurrency have attracted a lot of attention from the public. But they're also attracting the attention of the government.
The Senate Banking Committee announced after market close today it would hold a hearing on the social media giant's move into cryptocurrency, in addition to other issues. Specifically, the tersely worded news release from the committee said it would explore "Facebook's proposed digital currency and data privacy concerns." The hearing is scheduled for July 16. No witnesses have yet been called for the proceeding.
The committee's ranking majority leader, Republican Sen. Mike Crapo of Idaho, said on Twitter that the move follows a letter the committee sent to Facebook in May "outlining several of our questions or concerns." It is not known if the letter received an official reply. Facebook has not yet publicly commented on this latest congressional hearing about its business.
Details aboutthe Facebook currency, to be known as Libra, were unveiled by the company earlier this week.
It seems investors are mulling over the Senate scrutiny. Facebook is one of the most actively traded stocks in post-market trading tonight. It's down slightly from its closing price.
Another popular tech stock trading briskly this evening isOracle(NYSE: ORCL), which released its Q4 of fiscal 2019 results just after market close.
The database king booked revenue of $11.1 billion for the quarter, up 1% on a year-over-year basis. Adjusted net profit also inched higher, by 3% to hit $4.1 billion, forearnings per share(EPS) of $1.16.
Both line items represented convincing beats. On average, analysts had been expecting just under $11 billion on the top line and EPS of $1.07.
As with numerous other IT market veterans, Oracle has done well lately shifting its business focus to cloud services. The company specifically identified its Fusion and NetSuite applications as recent growth drivers.
In addition to being one of the more heavily traded stocks tonight, Oracle is also near the top of the gainers list. It's currently trading nearly 5% higher on the after-hours market.
Much of tonight's stock market buzz centers on a tech company that isn't a stock at all... at least, not quite yet. That would beSlack Technologies(NYSE: WORK), the corporate messaging app specialist that is just about to launch its initial public offering (IPO).
Not long after market close, the New York Stock Exchange, which will effectively host the Slack IPO and list the stock under the wonderfully appropriate ticker symbol WORK, provided a reference price of $26 per share. The reference price serves as an indicator for traders as to what a fair level for the stock might be.
In a move that had, prior to this year, been unusual, Slack's IPO will not be a traditional one led by a syndicate of investment banks. Instead, this IPOwill take the form of a direct listing, in which current shareholders sell some of their stock to the public via an exchange, without a middleman. The direct IPO method was most notably used by music purveyorSpotify Technologyin its 2018 market debut.
The Slack IPO hits the market tomorrow. All told, the company consists of just over 194 million Class A shares (the Class that will be sold in the issue) and a bit over 310 million B shares. The latter confers 10 votes per shareholder, the former only one. We can expect lively action in the stock during the trading day, and probably in the post-market hours, too.
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Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors.Eric Volkmanowns shares of Facebook. The Motley Fool owns shares of and recommends Facebook. The Motley Fool has adisclosure policy. |
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