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UPDATE 1-Japan aluminium premiums climb to $108/T in Q3, up 3% -sources
* July-September premiums mark second straight quarterly increase
* Higher premiums reflect tighter supply in Asia
* Fears over lower demand from semiconductor sector caps gains (Adds details)
By Yuka Obayashi
TOKYO, June 21 (Reuters) - Premiums for Japanese aluminium shipments for July to September were set at $108 per tonne, up 3% from the current quarter, as tighter supply in Asia outweighed fears over weakening demand, five sources directly involved in the pricing talks said.
The new figure is higher than the $105 per tonne premiums <PREM-ALUM-JP> in the April to June quarter and marks a second straight quarterly increase. Producers had sought premiums of $115 to $120 per tonne for the third quarter.
Japan is Asia's biggest importer of aluminium and the premiums for primary metal shipments it agrees to pay each quarter over the London Metal Exchange (LME) cash price set the benchmark for the region.
"We had signed all of our July-September term contacts at $108 a tonne by early this week," a source at a producer said.
Spot premiums in Asia have risen due to fewer shipments of semi-fabricated metal from China to other Asian countries due to stronger aluminium prices on the Shanghai Futures Exchange (ShFE), the source said.
Semi-fabricated metal, or semis, can be melted down for use as primary metal.
But slower demand from China for the light metal, used in semiconductors and the machinery to make them, as well as worries over further weakness in demand due to an escalating U.S.-Sino trade conflict capped gains, said another source at a trading house that also signed its July-September contracts at $108 a tonne.
Japan's exports fell for a sixth straight month in May as China-bound shipments of semiconductor manufacturing equipment and car parts weakened. The falling shipments indicate a deteriorating outlook for growth as Japan's trade-reliant economy faces persistent pressure from slowing external demand.
The latest quarterly price negotiations began late last month between Japanese buyers and global producers, including Rio Tinto , South32 Ltd and Alcoa Corp .
(Reporting by Yuka Obayashi; Editing by Tom Hogue) |
Does Logismos Information Systems S.A.'s (ATH:LOGISMOS) -6.6% Earnings Drop Reflect A Longer Term Trend?
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Examining Logismos Information Systems S.A.'s (ATH:LOGISMOS) past track record of performance is a useful exercise for investors. It allows us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess LOGISMOS's latest performance announced on 31 December 2018 and weight these figures against its longer term trend and industry movements.
See our latest analysis for Logismos Information Systems
LOGISMOS recently turned a profit of €38k (most recent trailing twelve-months) compared to its average loss of -€13.9k over the past five years.
In terms of returns from investment, Logismos Information Systems has fallen short of achieving a 20% return on equity (ROE), recording 0.6% instead. Furthermore, its return on assets (ROA) of 0.6% is below the GR Software industry of 4.2%, indicating Logismos Information Systems's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Logismos Information Systems’s debt level, has increased over the past 3 years from 0.9% to 2.2%.
Logismos Information Systems's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors influencing its business. I recommend you continue to research Logismos Information Systems to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for LOGISMOS’s future growth? Take a look at ourfree research report of analyst consensusfor LOGISMOS’s outlook.
2. Financial Health: Are LOGISMOS’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 December 2018. 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. |
South Korean firm wins mining leases for long-delayed Australian coal project
By Sonali Paul MELBOURNE (Reuters) - An Australian state on Friday granted mining leases for a coal mine controlled by Korea Resources Corp (KORES), clearing the way for a project that green groups and some local communities have battled for more than a decade. The final approval from the New South Wales (NSW) state government follows a surprise victory for the pro-coal conservative government in an Australian election in which climate change had been a key issue. "The project involves a capital investment of over A$800 million ($554 million) and will create more than 1,700 direct and indirect jobs," the state's government said in a statement on the mining lease approval on Friday. The election outcome has put pressure on state governments that had been opposed to new coal mines to clear the way for projects that have long been held up, to create new jobs. "This is a very positive sign that the recently re-elected NSW Government is serious about backing regional jobs and investment during the term of this Parliament," said New South Wales Minerals Council Chief Executive Stephen Galilee. Neighbouring Queensland state last week cleared the way for Indian conglomerate Adani Enterprises' Carmichael mine. KORES, leading the Wyong Areas Coal Joint Venture, plans to dig an underground mine to produce up to 5 million tonnes a year of thermal coal for power stations over 28 years, aiming to start production in late 2022 or early 2023, project manager Kenny Barry said. "We were very pleased with today's outcome, following what's been a very exhaustive evaluation process over a number of years," Barry told Reuters. He predicted that most of the coal would be exported to Southeast Asian nations, but said some could go to local power stations. The Wallarah 2 coal project won environmental approval in January 2018, with strict measures to prevent damage to local drinking water, a major issue raised by the project's opponents. Story continues "We think New South Wales will rue the day it approved this mine which is going to be built under the drinking water catchment of one of our fastest growing regions," said Georgina Woods, a spokeswoman for Lock the Gate Alliance, an environmental group. She said the mining lease grant had been inevitable after the state's independent planning commission approved the project last year. ($1 = 1.4447 Australian dollars) (Reporting by Sonali Paul; Editing by Joseph Radford and Sherry Jacob-Phillips) |
Have Insiders Been Selling Lloyds Banking Group plc (LON:LLOY) Shares?
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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares inLloyds Banking Group plc(LON:LLOY).
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. 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.'
Check out our latest analysis for Lloyds Banking Group
The , David J. Oldfield, made the biggest insider sale in the last 12 months. That single transaction was for UK£571k worth of shares at a price of UK£0.61 each. So we know that an insider sold shares at around the present share price of UK£0.58. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
Over the last year, we can see that insiders have bought 913k shares worth UK£525k. But insiders sold 3.8m shares worth UK£2.3m. All up, insiders sold more shares in Lloyds Banking Group than they bought, over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Lloyds Banking Group better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying.
Over the last three months, we've seen notably more insider selling, than insider buying, at Lloyds Banking Group. In total, insiders sold UK£643k worth of shares in that time. On the other hand we note Independent Director Stuart Sinclair bought UK£223k worth of shares. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the shares are not cheap.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Lloyds Banking Group insiders own about UK£54m worth of shares. That equates to 0.1% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
The stark truth for Lloyds Banking Group is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Lloyds Banking Group is growing earnings. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. Of course,the future is what matters most. So if you are interested in Lloyds Banking Group, you should check out thisfreereport on analyst forecasts for the company.
Of courseLloyds Banking Group 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. |
Japanese crypto exchange Fisco receives business improvement order by regulator
Japanese cryptocurrency exchange Fisco has received a business improvement order by the country’s financial regulator. The Financial Services Agency (FSA) announced the news Friday, saying that Fisco management "did not recognize the importance of legal compliance", which led to "a number of legal violations." There have also been issues with the exchange's business management system and the risk management system for money laundering and terrorism financing, the FSA said. Fisco was reportedly “ raided ” by the FSA back in April, to ensure "appropriate measures have been implemented for customer protection and legal compliance after the management changes.” The regulator has now, therefore, ordered Fisco to set up a management system where "the functions of the internal management department and the audit department can be fully realized," as well as to put up in place legal compliance. Fisco has also been asked to establish a risk management system, outsourcing management system, book document management system and audit system, according to the announcement. A business improvement plan needs to be submitted by Fisco in writing by July 22, the regulator said. Fisco is also the owner of Zaif crypto exchange, which suffered a massive hack of around $62.5 million and lost bitcoin, bitcoin cash and monacoin in the breach. Zaif only recently resumed full services under the new owner Fisco. It was earlier operated by Tech Bureau, which sold the business to Fisco for $44.7 million last year. The FSA was also reportedly investigating cryptocurrency exchange Huobi Japan in April. |
Lloyds Banking Group plc (LON:LLOY) Insiders Have Been Selling
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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares inLloyds Banking Group plc(LON:LLOY).
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, most countries require that the company discloses such transactions to the market.
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.'
See our latest analysis for Lloyds Banking Group
In the last twelve months, the biggest single sale by an insider was when the , David J. Oldfield, sold UK£571k worth of shares at a price of UK£0.61 per share. So what is clear is that an insider saw fit to sell at around the current price of UK£0.58. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.
Over the last year, we can see that insiders have bought 913k shares worth UK£525k. But they sold 3.8m for UK£2.3m. Over the last year we saw more insider selling of Lloyds Banking Group shares, than buying. 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!
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Over the last three months, we've seen notably more insider selling, than insider buying, at Lloyds Banking Group. In that time, insiders dumped UK£643k worth of shares. On the flip side, Independent Director Stuart Sinclair spent UK£223k on purchasing shares. Generally this level of net selling might be considered a bit bearish.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.1% of Lloyds Banking Group shares, worth about UK£54m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
The insider sales have outweighed the insider buying, at Lloyds Banking Group, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. On the plus side, Lloyds Banking Group makes money, and is growing profits. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. So we'd only buy after careful consideration. Of course,the future is what matters most. So if you are interested in Lloyds Banking Group, you should check out thisfreereport on analyst forecasts for the company.
But note:Lloyds Banking Group 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. |
British Airways and KLM among airlines avoiding Iranian airspace over shootdown
Aircraft belonging to KLM and Malaysia Airlines, both of which will avoid Iranian-controlled airspace. Photo: aviation-images.com/Universal Images Group via Getty Images British Airways, Dutch airline KLM ( AFLYY ), Australia’s Qantas Airways (QAN.AX) , Singapore Airlines ( SINGY ), and Malaysia Airlines are among several carriers that have said they will avoid Iranian-controlled airspace following the shooting down of a US drone. On Thursday, the US Federal Aviation Administration (FAA) issued an emergency order, banning US-registered planes from flying in large swathes of the Strait of Hormuz and the Gulf of Oman. Earlier on Thursday, an Iranian surface-to-air missile shot down a massive, unmanned, and unarmed US drone known as a Navy Global Hawk. Warning of “heightened military activities and increased political tensions in the region,” the FAA said there was “an inadvertent risk to US civil aviation operations and potential for miscalculation or misidentification.” The FAA noted that the nearest civil aircraft was only 45 nautical miles away from the drone when it was shot down. READ MORE: Oil rises on US-Iran tensions: 'Iran made a very big mistake!' “There were numerous civil aviation aircraft operating in the area at the time of the intercept,” it said. British Airways said in a statement on Friday that it was following FAA guidance to avoid the area and that its planes would use alternative routes. “Our safety and security team are constantly liaising with authorities around the world as part of their comprehensive risk assessment into every route we operate,” a spokesperson said. KLM announced it would not fly in Iranian-controlled airspace on Friday, but did not comment further. The ban, which the FAA said would be in effect until further notice, followed the decision by United Airlines to suspend flights between New Jersey’s Newark airpot and Mumbai in India after a safety review. Several of the world’s top long-haul airlines operate from the Persian Gulf. But a number of them — including Etihad, Emirates, and Qatar Airways — had not yet made a decision on whether to suspend flights in the region. Etihad announced that it had activated “contingency plans,” however, and said it was “carefully monitoring the current situation.” “We will decide what further action is required after carefully evaluating the FAA directive to U.S. carriers.” |
NRA tears itself apart after president stages failed coup against chief executive Wayne LaPierre
The National Rifle Association has suspended its top lobbyist after accusing him of complicity in a failed coup against the gun group’s chief executive Wayne LaPierre . Chris Cox, the NRA’s second-in-command, allegedly worked with public relations firm Ackerman McQueen, former NRA president Oliver North and NRA board member Dan Boren to try to force out Mr LaPierre. The accusation came in a lawsuit filed on Wednesday night in New York state Supreme Court against Mr North who led the coup attempt shortly before the group’s annual convention in April. In the lawsuit, the NRA said that text messages and emails demonstrated that “another errant NRA fiduciary, Chris Cox – once thought by some to be a likely successor for LaPierre – participated” in what was described as a conspiracy. The court filing includes text exchanges in which Mr Cox and a board member appear to be discussing an effort to oust Mr LaPierre, although the full context is unclear. The NRA is conducting an internal review of the matter. Andrew Arulanandam, a spokesperson for the organisation, said that Mr Cox had “been placed on administrative leave” on Thursday. Mr Cox said in a statement: “The allegations against me are offensive and patently false. For over 24 years I have been a loyal and effective leader in this organisation. "My efforts have always been focused on serving the members of the National Rifle Association, and I will continue to focus all of my energy on carrying out our core mission of defending the Second Amendment.” The suit – the latest in a series of legal actions stemming from the gun group’s internal turmoil – is likely to send new shock waves through the NRA. While Mr North served as president for just one year, Mr Cox has worked for the NRA since 1995 and has led its lobbying arm since 2002. He has been a leading presence at the organisation's gatherings. Among other things, he has been a fervent defender of the AR-15, the semi-automatic rifle used in many mass shootings, telling attendees at the group’s convention last year that “we have an AR culture that’s on display all over the exhibit halls this weekend”. Together, Mr Cox, 49, and Mr LaPierre, 69, have been the public faces of the NRA, the twin architects of its strategy. But they have had an uneasy relationship, and their staff are somewhat siloed from each other. Mr Cox runs the NRA’s lobbying arm, the Institute for Legislative Action, which has a separate media relations team from the NRA’s, and his choice of consultants has also sometimes diverged from Mr LaPierre’s. Story continues As Mr North’s coup attempt played out at the convention this spring, some people inside the NRA said Mr Cox largely kept quiet and appeared to be hedging his bets. Jennifer Baker, a spokeswoman for the NRA’s lobbying arm, said Mr Cox and Mr LaPierre had “worked closely together for a quarter of a century, and any notion that Chris participated in a coup is absurd". "Chris Cox is known as a calming force who always acts in the best interests of our members by effectively defending the Second Amendment, so it’s not surprising that board members would reach out to him for advice during tumultuous times.” But Carolyn D Meadows, who succeeded Mr North as NRA president, said in a statement: “I fully support the actions undertaken today. "The NRA is moving forward on all fronts, especially with regard to serving our members and focusing on the crucial upcoming elections.” The genesis of the dispute between the NRA and Mr North is a related legal battle between the NRA and its most prominent contractor , the Oklahoma-based advertising firm Ackerman McQueen, which employed Mr North. The NRA has sued Ackerman, claiming it withheld documents and records from the gun group, and some officials have suggested the company may also have been overcharging the gun group. Ackerman, which has said it did nothing improper, filed a counter suit claiming that it was smeared by the NRA. In yet another lawsuit, the NRA has accused Ackerman of breaching confidentiality clauses in its contract and smearing Mr LaPierre. The new lawsuit seeks to block Mr North’s attempt to have the NRA pay his legal fees, which he has sought as he fields requests to cooperate with other litigation as well as a Senate inquiry. New York Times View comments |
Is It Time To Consider Buying Legal & General Group Plc (LON:LGEN)?
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Let's talk about the popular Legal & General Group Plc (LON:LGEN). The company's shares saw significant share price movement during recent months on the LSE, rising to highs of £2.91 and falling to the lows of £2.55. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Legal & General Group's current trading price of £2.66 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Legal & General Group’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
See our latest analysis for Legal & General Group
Great news for investors – Legal & General Group is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is £5.3, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. What’s more interesting is that, Legal & General Group’s share price is theoretically quite stable, which could mean two things: firstly, it may take the share price a while to move to its intrinsic value, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Legal & General Group, it is expected to deliver a relatively unexciting earnings growth of 8.6%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term.
Are you a shareholder?Even though growth is relatively muted, since LGEN is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor?If you’ve been keeping an eye on LGEN for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy LGEN. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Legal & General Group. You can find everything you need to know about Legal & General Group inthe latest infographic research report. If you are no longer interested in Legal & General Group, you can use our free platform to see my list of over50 other stocks with a high growth potential.
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. |
Medistim ASA (OB:MEDI) Earns A Nice Return On Capital Employed
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Today we'll evaluate Medistim ASA (OB:MEDI) to determine whether it could have potential as an investment idea. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.
First up, we'll look at what ROCE is and how we calculate it. Next, we'll compare it to others in its industry. And finally, we'll look at how its current liabilities are impacting its ROCE.
ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Author Edwin Whitingsaysto be careful when comparing the ROCE of different businesses, since 'No two businesses are exactly alike.'
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Medistim:
0.35 = øre80m ÷ (øre286m - øre54m) (Based on the trailing twelve months to March 2019.)
Therefore,Medistim has an ROCE of 35%.
View our latest analysis for Medistim
ROCE is commonly used for comparing the performance of similar businesses. Using our data, we find that Medistim's ROCE is meaningfully better than the 12% average in the Medical Equipment industry. We would consider this a positive, as it suggests it is using capital more effectively than other similar companies. Regardless of the industry comparison, in absolute terms, Medistim's ROCE currently appears to be excellent.
Remember that this metric is backwards looking - it shows what has happened in the past, and does not accurately predict the future. ROCE can be misleading for companies in cyclical industries, with returns looking impressive during the boom times, but very weak during the busts. ROCE is, after all, simply a snap shot of a single year. What happens in the future is pretty important for investors, so we have prepared afreereport on analyst forecasts for Medistim.
Current liabilities are short term bills and invoices that need to be paid in 12 months or less. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To counter this, investors can check if a company has high current liabilities relative to total assets.
Medistim has total liabilities of øre54m and total assets of øre286m. Therefore its current liabilities are equivalent to approximately 19% of its total assets. The fairly low level of current liabilities won't have much impact on the already great ROCE.
Low current liabilities and high ROCE is a good combination, making Medistim look quite interesting. Medistim shapes up well under this analysis,but it is far from the only business delivering excellent numbers. You might also want to check thisfreecollection of companies delivering excellent earnings growth.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
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. |
Marathon Asset Management’s Return, AUM, and Holdings
Bruce J. Richards and Louis Hanover co-founded their own investment manager, Marathon Asset Management , back in 1998. The fund, which is oriented towards global credit markets, is based in New York, providing additional offices to its clients in Singapore, and London. At the end of January 2017, Marathon Asset Management held around 15.25 billion in client regulatory assets under management on a discretionary basis and $384.53 million on a non-discretionary basis. The fund’s Chairman and CEO is Bruce Richards, who had 15 years of professional experience in the investment world of Wall Street before co-launching his own hedge fund. During that time he worked at Smith Barney and Donaldson, where he was a Managing Director in the fixed income division, and at Lufkin & Jenrette where he was in charge of the primary investments. He was also employed at Shearson Lehman Hutton, whereas the beginnings of his career were at Pain Webber. Bruce Richards graduated summa cum laude with a B.A. in Economics from Tulane University (and was a member of Phi Beta Kappa). Before co-founding Marathon Asset Management with Bruce Richards, Louis Hanover, the fund’s current CIO, also worked at Smith Barney as a Managing Director, taking care of all trading operations and risk management in the global emerging markets debt trading sector. Prior to Smith Barney, he was employed at Merrill Lynch, Nomura Securities, First Chicago Capital Markets, and Chicago Board of Trade. Louis Hanover graduated with a B.A. in Economic History from the University of Chicago and an M.B.A. from the University of Chicago Booth School of Business. [caption id="attachment_380470" align="aligncenter" width="750"] Marathon Asset Management’s Return, AUM, and Holdings photofriday/Shutterstock.com[/caption] Marathon Asset Management relies on several investment strategies to achieve favorable returns for its clients. Those strategies include Emerging Markets, Private Credit, Corporate Credit, Structured Credit, Leveraged Credit, and Real Estate. These strategies rely on crucial bottom-up research ran via separate accounts and combined funds. The fund’s main specialty is “investing in credit dislocations through multiple economic cycles”. Its global credit market operations count emerging markets debt, private credit lending opportunities, distressed debt, and structured credit. Ten years ago, its proficiency was recognized by the US Treasury, which chose it to handle assets for the Public-Private Investment Program together with only eight more investment managers. Speaking of its proficiency and trying to get a better insight into it, we tracked some of its performance figures. Story continues In the last couple of years, its Marathon Partners LP fund had mainly positive return figures. In 2013, it generated a fantastic return of 37.65%, followed by a loss of 0.58% in 2014. One down year didn’t impact the fund’s overall performance much, as it came back on its fet in the following years, delivering 5.86%, and even higher 7.46% in 2016. 2017 was also favorable for the fund, which brought back 13.75%. Last year through October, Marathon Partners LP fund gained 1.01%. Its total return amounted to 1723.79%, for a compound annual return of 14.46%, while its worst drawdown was 34.46. Its Marathon Securitized Credit fund that utilizes Structured Credit investment strategy brought back 13.3% in 2013, and 8.9% in 2014, and its Marathon Special Opportunity fund that relies on Event-Driven Distressed strategy lost 11.9% in 2015, and gained 17.8% in 2016. Insider Monkey’s mission is to identify promising (and also terrible) hedge fund stock pitches and share them with our subscribers. We launched a long activist investing strategy in our monthly newsletter 2 years ago. This strategy’s stock picks returned 61% in 2 short years, vs. a gain of 21% for the S&P 500 Index ETF (SPY). Last October we shared one of our stock picks, Ascendis Pharmaceuticals (ASND), in a free sample issue of our monthly newsletter (you can still download it free of charge ). The stock doubled in less than 5 months. We have also been very successful at identifying stocks that will decline even in a bull market. We launched our short strategy a little more than 2 years ago and share our short stock picks in our quarterly newsletter. This strategy’s picks lost 30.9% since then, vs. a gain of 24% for the S&P 500 Index. This means our short strategy actually outperformed the market by nearly 55 percentage points (let us know if you don’t understand how the outperformance for a short strategy is calculated). Recently our monthly newsletter identified another undervalued stock that is expected to increase its earnings by more than 10% annually and trades at only 10 times its 2019 earnings. We expect this stock to return 60% in the next 12-24 months. We take a closer look at hedge funds like Marathon Asset Management in order to identify their best and worst ideas. At the end of the first quarter of 2019, Marathon Asset Management’s equity portfolio was valued $384.01 million, down by 14.66% from one quarter earlier when it had a value of $449.96 million. During the quarter the fund dumped its positions in Corporación América Airports S.A. (NYSE: CAAP ) worth $1.42 million on the account of 212,441 shares and Five Point Holdings, LLC (NYSE: FPH ) , whose 1.17 million shares valued $8.09 million the fund held. The fund didn’t hold a single position in this quarter in one of 30 Most Popular Stocks Among Hedge Funds in Q1 of 2019 . Click here to read the rest of this article, where we present the fund’s biggest positions at the end of March 2019. Disclosure: None This article was originally published at Insider Monkey . |
Read This Before Buying Medistim ASA (OB:MEDI) Shares
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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellMedistim ASA(OB:MEDI), you may well want to know whether insiders have been buying or selling.
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, such insiders must disclose their trading activities, and not trade on inside information.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia Universitystudyfound that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
View our latest analysis for Medistim
There wasn't any very large single transaction over the last year, but we can still observe some trading.
We note that in the last year insiders divested 1749 shares for a total of øre140k. Medistim insiders didn't buy any shares over the last 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!
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Medistim insiders own about øre651m worth of shares. That equates to 26% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
The fact that there have been no Medistim insider transactions recently certainly doesn't bother us. It's great to see high levels of insider ownership, but looking back at the last year, we don't gain confidence from the Medistim insiders selling. Of course,the future is what matters most. So if you are interested in Medistim, you should check out thisfreereport on analyst forecasts for the company.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity 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. |
Marathon Asset Management’s Return, AUM, and Holdings (Part II)
Read the beginning of thisarticle here.
Marathon Asset Management’s biggest position at the end of the first quarter of 2019 was in one of the largest gaming hotel and casino corporations in the world,Caesars Entertainment Corporation (NASDAQ:CZR). During the quarter, the fund actually lowered its stake in the company by 15% to 1.88 million shares, with a value of $16.3 million, amassing 4.24% of its equity portfolio. This $6.31 billion market cap company was founded back in 1937 in Reno, Nevada, and since then it has grown and expanded, now managing its casinos and providing its services on three continents. Year-to-date, the company’s stock gained 45.23%, and on June 20th, it had a closing price of $10.05. Its price-to-earnings ratio is 56.89. In its last financial report for the first quarter of 2019, Caesars disclosed net revenues of $2.12 billion and a loss per share of $0.32, compared to net revenues of $1.97 billion and a loss per share of $0.05 in the same quarter of 2018.
Berry Petroleum Corporation (NASDAQ:BRY)was the fund’s second largest holding at the of Q1 2019. Its position in the company was valued $14.64 million, on the account of 1.27 million shares. As the name denotes it, Berry Petroleum is a petroleum, and natural gas producer and explorer. The company is headquartered in Bakersfield, California, and has a market cap of $894.94 million. For the first quarter of 2019, Berry Petroleum reported a net loss of $34 million, or a loss of $0.42 per diluted share, and adjusted net income of $24 million or $0.30 per diluted share. This compares to net income of $131.77 million or $1.56 per diluted share, and to adjusted net income of $34.80 million in the previous quarter (Q4 2018). In the report, the company also announced a regular $0.12 per share dividend for the second quarter of 2019. Over the past 12 months, Berry’s stock lost 30.68%, and on June 20th, it had a closing price of $11.09. The same day, UBS Group set a price target of $14.00, with a ‘Buy’ rating on it.
The third most valuable position in Marathon Asset Management’s portfolio, at the end of March 2019, was inConstellium N.V. (NYSE:CSTM)and it counted 1.48 million shares with a value of $12.59 million, comprising 3.27% of its 13F portfolio. Constellium N.V. is a global producer of aluminum rolled products, which is responsible for some important advancements in the industry on a global level. Its market cap is $1.37 billion, and the stock is trading at a P/E ratio of 6.98. For the first quarter of 2019, the company disclosed revenue of €1.54 billion and diluted and basic earnings per share of €0.17, compared to revenue of €1.29 billion and diluted and basic loss per share of €0.18 in the same quarter of 2018. On June 19, Deutsche Bank restated its ‘Buy’ rating on the stock. Over the last six months, the company’s stock gained 55.62%, having a closing price on June 20thof $10.10.
The remaining two long positions in the fund’s 13F portfolio includedLadder Capital Corp (NYSE:LADR)andCity Office REIT, Inc. (NYSE:CIO).In Ladder Capital, the fund reported $4.98 million worth of stake, on the basis of 292,740 shares outstanding, while in City Office Reit the fund held $1.13 million worth a position, on the account of 100,000 shares.
Disclosure:None
This article was originally published atInsider Monkey. |
Fortune Brands Gains From Segmental Health Despite High Costs (Revised)
We issued an updated research report onFortune Brands Home & Security, Inc.FBHS on Jun 14.This security and safety service provider currently carries a Zacks Rank #3 (Hold). Its market capitalization is approximately $7.6 billion.Let’s delve deeper and discuss the company’s potential growth drivers and possible headwinds.Factors Favoring Fortune BrandsShare Price Performance, Earnings Projections:Market sentiments seem to be working in favor of Fortune Brands over time. In the past three months, the company’s share price has gained 23.7%, higher than the industry’s growth of 10.2%.
We believe that impressive financial results helped in driving sentiments for the stock. Fortune Brands in the last reported quarter (first-quarter 2019) recorded positive earnings surprise of 6.78%. Its share has increased 6.7% since the results released on Apr 24, 2019.For 2019, the company anticipates gaining from solid growth opportunities for the segments (explained below), synergistic gains from acquired assets, product innovations and capacity expansion. Revenues for the year are predicted to increase 6-7.5% on a year-over-year-basis, while earnings are predicted to grow 9% to $3.53-$3.77 per share.Also, the Zacks Consensus Estimate for the company’s earnings was revised upward for Fortune Brands. It currently is pegged at $3.66 for 2019 and $4.02 for 2020, reflecting growth of 0.8% and 0.5%, respectively, from the 60-day-ago figures.Fortune Brands Home & Security, Inc. Price and Consensus
Fortune Brands Home & Security, Inc. price-consensus-chart | Fortune Brands Home & Security, Inc. QuoteSegmental Growth Opportunities:The company operates through three business segments — Cabinets, Plumbing, and Doors & Security. In the first quarter of 2019, sales performances of these segments helped drive its top line.
For 2019, Fortune Brands anticipates its Plumbing segment’s sales to increase in a mid to high-single-digit range. Cabinets will benefit from healthy demand across product lines. This segment’s sales are predicted to grow 3-4%. For the Doors & Security segment, healthy demand for Therma-Tru and Master Lock products will be beneficial.Capital Allocation Strategies:The company effectively uses capital for making acquisitions, investing in growth projects and rewarding shareholders handsomely. With regard to buyouts, Fiberon (acquired in September 2018) has been strengthening Fortune Brands’ existing door brand — Therma-Tru — and enhancing its growth opportunities in the outdoor living space.Also, the company believes in rewarding shareholders with dividend payments and share repurchase. In 2018, it used $470 million on the Fiberon buyout, $695 million for repurchasing shares and $115 million for paying dividends. Also, the company announced a 10% hike in its quarterly dividend rate in December 2018.Factors Working Against Fortune BrandsHigh Costs Troubling:The company has been suffering from risks arising from higher costs and expenses. In the first quarter of 2019, its cost of sales increased 7% on a year-over-year basis. High freight charges and raw material price inflation might be behind the escalation.For 2019, the company believes that inflation caused by tariffs will adversely influence its results by $65 million.High Debts:Fortune Brands suffers from adverse impacts of high debt levels. In the last five years (2014-2018), the company’s long-term debt increased 22.9% (CAGR). This metric stood at $2,169.7 million at the end of the first quarter of 2019, reflecting sequential growth of 19.9%.Other Headwinds:Fortune Brands’ businesses are highly susceptible to natural calamities. Hurricane Florence adversely impacted the company’s Plumbing segment and also impacted some of its cabinet operations. Recurrence of such natural calamities might disturb its operations.Stocks to ConsiderSome better-ranked stocks in the Zacks Industrial Products sector Roper Technologies, Inc. ROP, Chart Industries, Inc. GTLS and DXP Enterprises, Inc. DXPE. While Roper and Chart Industries currently sport a Zacks Rank #1 (Strong Buy), DXP Enterprises carries a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.In the past 30 days, earnings estimates for all these three stocks have improved for the current year. Further, average earnings surprise for the last four quarters was positive 8.43% for Roper, 16.56% for Chart Industries and 48.47% for DXP Enterprises.(We are reissuing this article to correct a mistake. The original article, issued on June 14, 2019, should no longer be relied upon.)
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 reportRoper Technologies, Inc. (ROP) : Free Stock Analysis ReportDXP Enterprises, Inc. (DXPE) : Free Stock Analysis ReportChart Industries, Inc. (GTLS) : Free Stock Analysis ReportFortune Brands Home & Security, Inc. (FBHS) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
GBP/USD Rally Stalled Ahead of Major Resistance
When a down trending pair makes a strong recovery, it often signals of more gains to come.GBP/USDis a great example of this as the pair has fallen drastically since early May. This week, however, the pair not only recovered a great deal, but it did so with very shallow pullbacks.
On a weekly chart, it has nearly fully erased losses from the prior week. And last week saw a notable fall in the pair. Currently, there is some strong overhead resistance near 1.2750 that stands to cap near-term rallies. But the message I’m getting, based on momentum and recent shifts in US monetary policy stance, is that the pair intends to break it.
There was a somewhat muted reaction to yesterdays Bank of England meeting. The main takeaway that I got was that the economy is heading in the right direction, setting up a potential rate hike.
At the same time, they concluded that policy could head either way, and any necessary adjustment would be made to keep the economy on the right track. Essentially covering for Brexit risks.
I find it interesting that the Bank of England is considering a rate hike and that they are managing to hold inflation near 2%. This reminds me of earlier days when there was divergent monetary policy between the ECB and Fed, offering great trading opportunities. Theoretically, the same situation is presented as the UK is leaning hawkish while all other major economies are swinging dovish.
But the bank’s comments on keeping the policy path open reflects the uncertainty about an economy that is exposed Brexit risks. Had it not been for Brexit,GBP/USDwould have been a no brainer trade. But then again, without Brexit in the picture, they probably would not be running inflation levels as high as they are now.
GBP/USD is showing some struggle to hold above 1.2700. I do see a strong confluence of support at 1.2655. It contains a horizontal level and the 100-period moving average on a 4-hour chart. Also, there is a rising trendline from this weeks low.
The hourly chart shows something similar with the 200 MA near 1.2655. So I expected declines to the level to be met by buyers. To the upside, I think 1.2747 is a very critical resistance level and I have a hard time seeing it getting breached. At least in the session ahead.
• I see support at 1.2655 and resistance at 1.2747.
• There is potential for a range to end the week out
• Considering the recent upside momentum, I think the bias here is clearly to the upside.
Thisarticlewas originally posted on FX Empire
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Is Micro Focus International plc's (LON:MCRO) Balance Sheet Strong Enough To Weather A Storm?
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Small-caps and large-caps are wildly popular among investors; however, mid-cap stocks, such as Micro Focus International plc (LON:MCRO) with a market-capitalization of UK£6.9b, rarely draw their attention. However, generally ignored mid-caps have historically delivered better risk adjusted returns than both of those groups. Today we will look at MCRO’s financial liquidity and debt levels, which are strong indicators for whether the company can weather economic downturns or fund strategic acquisitions for future growth. Note that this information is centred entirely on financial health and is a top-level understanding, so I encourage you to look furtherinto MCRO here.
Check out our latest analysis for Micro Focus International
MCRO's debt level has been constant at around US$4.9b over the previous year which accounts for long term debt. At this current level of debt, MCRO's cash and short-term investments stands at US$621m , ready to be used for running the business. Additionally, MCRO has generated US$615m in operating cash flow in the last twelve months, leading to an operating cash to total debt ratio of 13%, indicating that MCRO’s current level of operating cash is not high enough to cover debt.
Looking at MCRO’s US$2.4b in current liabilities, it appears that the company has been able to meet these commitments with a current assets level of US$3.1b, leading to a 1.25x current account ratio. The current ratio is the number you get when you divide current assets by current liabilities. For Software companies, this ratio is within a sensible range as there's enough of a cash buffer without holding too much capital in low return investments.
With a debt-to-equity ratio of 63%, MCRO can be considered as an above-average leveraged company. This is not uncommon for a mid-cap company given that debt tends to be lower-cost and at times, more accessible. We can check to see whether MCRO is able to meet its debt obligations by looking at the net interest coverage ratio. A company generating earnings before interest and tax (EBIT) at least three times its net interest payments is considered financially sound. In MCRO's, case, the ratio of 2.69x suggests that interest is not strongly covered, which means that lenders may refuse to lend the company more money, as it is seen as too risky in terms of default.
Although MCRO’s debt level is towards the higher end of the spectrum, its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. I admit this is a fairly basic analysis for MCRO's financial health. Other important fundamentals need to be considered alongside. I suggest you continue to research Micro Focus International to get a better picture of the mid-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MCRO’s future growth? Take a look at ourfree research report of analyst consensusfor MCRO’s outlook.
2. Valuation: What is MCRO worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether MCRO is currently mispriced by the market.
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. |
Should You Be Impressed By Madhav Copper Limited's (NSE:MCL) ROE?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine Madhav Copper Limited (NSE:MCL), by way of a worked example.
Over the last twelve monthsMadhav Copper has recorded a ROE of 28%. That means that for every ₹1 worth of shareholders' equity, it generated ₹0.28 in profit.
See our latest analysis for Madhav Copper
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Madhav Copper:
28% = ₹36m ÷ ₹131m (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 all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
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 amount earned after tax over the last twelve months. That means that the higher the ROE, the more profitable the company is. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. Pleasingly, Madhav Copper has a superior ROE than the average (11%) company in the Metals and Mining industry.
That is a good sign. In my book, a high ROE almost always warrants a closer look. For example,I often check if insiders have been buying shares.
Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Madhav Copper has a debt to equity ratio of 0.79, which is far from excessive. Its ROE is very impressive, and given only modest debt, this suggests the business is high quality. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is one way we can compare the business quality of different companies. 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.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. 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. Check the past profit growth by Madhav Copper by looking at thisvisualization of past earnings, revenue and cash flow.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity 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. |
With EPS Growth And More, MAS Financial Services (NSE:MASFIN) Is Interesting
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Like a puppy chasing its tail, some new investors often chase 'the next big thing', even if that means buying 'story stocks' without revenue, let alone profit. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses.
So if you're like me, you might be more interested in profitable, growing companies, likeMAS Financial Services(NSE:MASFIN). While that doesn't make the shares worth buying at any price, you can't deny that successful capitalism requires profit, eventually. While a well funded company may sustain losses for years, unless its owners have an endless appetite for subsidizing the customer, it will need to generate a profit eventually, or else breathe its last breath.
Check out our latest analysis for MAS Financial Services
If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS). That means EPS growth is considered a real positive by most successful long-term investors. It certainly is nice to see that MAS Financial Services has managed to grow EPS by 33% per year over three years. As a general rule, we'd say that if a company can keep upthatsort of growth, shareholders will be smiling.
One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. I note that MAS Financial Services's revenuefrom operationswas lower than its revenue in the last twelve months, so that could distort my analysis of its margins. While we note MAS Financial Services's EBIT margins were flat over the last year, revenue grew by a solid 31% to ₹3.9b. That's progress.
You can take a look at the company's revenue and earnings growth trend, in the chart below. For finer detail, click on the image.
The trick, as an investor, is to find companies that aregoing toperform well in the future, not just in the past. To that end, right now and today, you can checkour visualization of consensus analyst forecasts for future MAS Financial Services EPS100% free.
Like standing at the lookout, surveying the horizon at sunrise, insider buying, for some investors, sparks joy. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. Of course, we can never be sure what insiders are thinking, we can only judge their actions.
Any way you look at it MAS Financial Services shareholders can gain quiet confidence from the fact that insiders shelled out ₹15m to buy stock, over the last year. When you contrast that with the complete lack of sales, it's easy for shareholders to brim with joyful expectancy. We also note that it was the , Dhvanil Gandhi, who made the biggest single acquisition, paying ₹2.5m for shares at about ₹538 each.
And the insider buying isn't the only sign of alignment between shareholders and the board, since MAS Financial Services insiders own more than a third of the company. In fact, they own 71% of the company, so they will share in the same delights and challenges experienced by the ordinary shareholders. This makes me think they will be incentivised to plan for the long term - something I like to see. At the current share price, that insider holding is worth a whopping ₹24b. Now that's what I call some serious skin in the game!
Given my belief that share price follows earnings per share you can easily imagine how I feel about MAS Financial Services's strong EPS growth. On top of that, insiders own a significant stake in the company and have been buying more shares. So I do think this is one stock worth watching. Of course, just because MAS Financial Services is growing does not mean it is undervalued. If you're wondering about the valuation, check outthis gauge of its price-to-earnings ratio, as compared to its industry.
There are plenty of other companies that have insiders buying up shares. So if you like the sound of MAS Financial Services, you'll probably love thisfreelist of growing companies that insiders are buying.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
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. |
Does Mountfield Group Plc's (LON:MOGP) Recent Track Record Look Strong?
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Measuring Mountfield Group Plc's (LON:MOGP) track record of past performance is a useful exercise for investors. It enables us to understand whether or not the company has met or exceed expectations, which is an insightful signal for future performance. Today I will assess MOGP's recent performance announced on 31 December 2018 and weigh these figures against its long-term trend and industry movements.
See our latest analysis for Mountfield Group
MOGP recently turned a profit of UK£683k (most recent trailing twelve-months) compared to its average loss of -UK£434.7k over the past five years.
In terms of returns from investment, Mountfield Group has fallen short of achieving a 20% return on equity (ROE), recording 11% instead. However, its return on assets (ROA) of 6.5% exceeds the GB Construction industry of 6.2%, indicating Mountfield Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Mountfield Group’s debt level, has increased over the past 3 years from 4.0% to 19%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 76% to 19% over the past 5 years.
Mountfield Group's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that have performed well in the past, such as Mountfield Group gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Mountfield Group to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MOGP’s future growth? Take a look at ourfree research report of analyst consensusfor MOGP’s outlook.
2. Financial Health: Are MOGP’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 December 2018. 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. |
Price of Gold Fundamental Daily Forecast – Will Weaken if U.S. Dollar Resumes Safe-Haven Status
Gold futures are trading lower and in a position to post a potentially bearish technical pattern on the daily chart after reaching a new contract higher earlier in the session. The price action suggests sellers were waiting at the former contract high at $1413.30 to take profits after a tremendous rally this week.
At 09:30 GMT,August Comex goldis trading $1392.40, down $4.50 or -0.32%. The high for the session is $1415.40.
Early in the session, spot gold prices spiked to their highest level in five-years, underpinned by expectations of a July rate cut by the Federal Reserve and driven higher by worries over escalating tensions between the United States and Iran.
Firming U.S. Treasury yields, a recovery in the U.S. Dollar against a few major currencies and steady equity prices may have been the catalysts that encouraged gold investors to book profits.
Gold prices may have surged early on Friday amid concerns over escalating tensions between the United States and Iran. Investors turned defensive after the New York Times reported late Thursday that President Donald Trump approved military strikes on several Iranian targets, but surprisingly pulled back the order to launch the attacks.
According to the New York Times, Trump approved retaliatory military strikes against Iran on Thursday before changing his mind.
The New York Times, citing senior White House officials, says strikes were planned against a “handful” of targets.
“Planes were in the air and ships were in position, but no missiles had been filed when word came stand down,” the newspaper reported, citing an unnamed senior administration official.
According to the New York Times, top Pentagon officials warned a military response could result in a spiraling escalation with risks for US forces in the region.
The operation was called off after President Trump spent most of Thursday discussing Iran with his national security advisers and congressional leaders, according to AP reports.
On Wednesday the U.S. Energy Information Administration announced a bigger-than-expected drawdown in weekly inventories. Later that day, the Federal Reserve made comments that opened the door for the first rate cut in more than 10-years.
The wildcard today is the situation in the Middle East. Gold prices are likely to rally later today if there is military action by either side, but only if the U.S. Dollar weakens. If investors decide to use the dollar as a safe-haven asset then gold prices could actually weaken. It all depends on how investors treat the dollar.
The dollar is under pressure this week because investors feel the Fed will lower rates in late July. If investors feel the dollar is still the best currency to be in during times of geopolitical turmoil then it will rise. This will put pressure on gold prices.
So continue to monitor the direction of the U.S. Dollar today. It is controlling the direction of gold prices.
Thisarticlewas originally posted on FX Empire
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Morgan Sindall Group plc (LON:MGNS): Is It A Good Long Term Opportunity?
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The latest earnings release Morgan Sindall Group plc's (LON:MGNS) announced in March 2019 confirmed that the company benefited from a strong tailwind, leading to a double-digit earnings growth of 27%. Below, I've laid out key growth figures on how market analysts view Morgan Sindall Group's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. Note that I will be looking at net income excluding extraordinary items to get a better understanding of the underlying drivers of earnings.
See our latest analysis for Morgan Sindall Group
Market analysts' consensus outlook for the coming year seems pessimistic, with earnings decreasing by -0.7%. But in the following year, there is a complete contrast in performance, with generating double digit 8.3% compared to today’s level and continues to increase to UK£76m in 2022.
Although it is helpful to understand the rate of growth each year relative to today’s level, it may be more valuable to determine the rate at which the business is rising or falling every year, on average. The benefit of this method is that we can get a better picture of the direction of Morgan Sindall Group's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, I put a line of best fit through analyst consensus of forecasted earnings. The slope of this line is the rate of earnings growth, which in this case is 4.7%. This means that, we can expect Morgan Sindall Group will grow its earnings by 4.7% every year for the next couple of years.
For Morgan Sindall Group, I've put together three key aspects you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is MGNS worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether MGNS is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of MGNS? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
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. |
Trump Approved a Military Strike Against Iran—Then Backtracked on the Attack
The United States made preparations for a military strike against Iran in retaliation for the downing of a U.S. surveillance drone, but the operation was abruptly called off with just hours to go, a U.S. official said.
The official, who was not authorized to discuss the operation publicly and spoke on condition of anonymity, said the targets would have included radars and missile batteries. The New York Times reported that President Donald Trump had approved the strikes Thursday night, but then called them off. The newspaper cited anonymous senior administration officials.
The White House on Thursday night declined requests for comment.
Asked earlier in the day about a U.S. response to the attack, Trump said, “You’ll soon find out.”
The swift reversal was a stark reminder of the serious risk of military conflict between U.S. and Iranian forces as the Trump administration combines a “maximum pressure” campaign of economic sanctions with a buildup of American forces in the region. As tensions mounted in recent weeks, there have been growing fears that either side could make a dire miscalculation that led to war.
According to the official who spoke to The Associated Press, the strikes were recommended by the Pentagon and were among the options presented to senior administration officials.
It was unclear how far the preparations had gone, but no shots were fired or missiles launched, the official said.
The military operation was called off around 7:30 p.m. Washington time, after Trump had spent most of Thursday discussing Iran strategy with top national security advisers and congressional leaders.
The downing of the U.S. drone — a huge, unmanned aircraft — over the Strait of Hormuz prompted accusations from the U.S. and Iran about who was the aggressor. Iran insisted the drone violated Iranian airspace; Washington said it had been flying over international waters.
Trump’s initial comments on the attack were succinct. He declared in a tweet that “Iran made a very big mistake!” But he also suggested that shooting down the drone — which has a wingspan wider than aBoeing737 — was a foolish error rather than an intentional escalation, suggesting he may have been looking for some way to avoid a crisis.
“I find it hard to believe it was intentional, if you want to know the truth,” Trump said at the White House. “I think that it could have been somebody who was loose and stupid that did it.”
Trump, who has said he wants to avoid war and negotiate with Iran over its nuclear ambitions, cast the shootdown as “a new wrinkle … a new fly in the ointment.” Yet he also said “this country will not stand for it, that I can tell you.”
He said the American drone was unarmed and unmanned and “clearly over international waters.” It would have “made a big, big difference” if someone had been inside, he said.
But fears of open conflict shadowed much of the discourse in Washington. As the day wore on, Trump summoned his top national security advisers and congressional leaders to the White House for an hour-long briefing in the Situation Room. Attendees included Secretary of State Mike Pompeo, national security adviser John Bolton, CIA Director Gina Haspel, Joint Chiefs Chairman Gen. Joseph Dunford, acting Defense Secretary Patrick Shanahan and Army Secretary Mark Esper, whom Trump has said he’ll nominate as Pentagon chief.
Pompeo and Bolton have advocated hardline policies against Iran, but Rep. Adam Schiff, the chairman of the House intelligence committee, said “the president certainly was listening” when congressional leaders at the meeting urged him to be cautious and not escalate the already tense situation.
On Capitol Hill, leaders urged caution, and some lawmakers insisted the White House must consult with Congress before taking any actions.
House Speaker Nancy Pelosi said no specific options for a U.S. response were presented at the meeting. Senate Majority Leader Mitch McConnell said, “The administration is engaged in what I would call measured responses.” And late Thursday, House Republicans on the Foreign Affairs, intelligence and Armed Services committees issued a statement using the same word, saying, “There must be a measured response to these actions.”
The Trump administration has been putting increasing economic pressure on Iran for more than a year. It reinstated punishing sanctions following Trump’s decision to pull the U.S. out of an international agreement intended to limit Iran’s nuclear program in exchange for relief from earlier sanctions.
The other world powers who remain signed on to the nuclear deal have set a meeting to discuss the U.S. withdrawal and Iran’s announced plans to increase its uranium stockpile for June 28, a date far enough in the future to perhaps allow tensions to cool.
On Thursday, Iran called the sanctions “economic terrorism.”
Citing Iranian threats, the U.S. recently sent an aircraft carrier to the Persian Gulf region and deployed additional troops alongside the tens of thousands already there. All this has raised fears that a miscalculation or further rise in tensions could push the U.S. and Iran into an open conflict 40 years after Tehran’s Islamic Revolution.
“We do not have any intention for war with any country, but we are fully ready for war,” Revolutionary Guard commander Gen. Hossein Salami said in a televised address.
The paramilitary Guard, which answers only to Supreme Leader Ayatollah Ali Khamenei, said it shot down the drone at 4:05 a.m. Thursday when it entered Iranian airspace near the Kouhmobarak district in southern Iran’s Hormozgan province. Kouhmobarak is about 1,200 kilometers (750 miles) southeast of Tehran.
Taking issue with the U.S. version of where the attack occurred, Iranian Foreign Minister Mohammad Javad Zarif tweeted that his country had retrieved sections of the military drone “in OUR territorial waters where it was shot down.” He said, “We don’t seek war but will zealously defend our skies, land & waters.”
Air Force Lt. Gen. Joseph Guastella, commander of U.S. Central Command air forces in the region, disputed that contention, telling reporters that the aircraft was 34 kilometers (21 miles) from the nearest Iranian territory and flying at high altitude when struck by a surface-to-air missile. The U.S. military has not commented on the mission of the remotely piloted aircraft that can fly higher than 10 miles in altitude and stay in the air for over 24 hours at a time.
“This attack is an attempt to disrupt our ability to monitor the area following recent threats to international shipping and free flow of commerce,” he said.
Late Thursday, the Federal Aviation Administration barred American-registered aircraft from flying over parts of the Persian Gulf and the Gulf of Oman. Australia’s Qantas and Dutch carrier KLM said Friday their planes will also not fly over the area while Etihad, the Abu Dhabi-based long-haul carrier, said it had “contingency plans” in place, without elaborating.
Democratic leaders in particular urged the president to work with U.S. allies and stressed the need for caution to avoid any unintended escalation.
Sen. Chuck Schumer of New York said he told Trump that conflicts have a way of escalating and “we’re worried that he and the administration may bumble into a war.”
____
Associated Press writers Jill Colvin, Lisa Mascaro and Matthew Lee in Washington, Jon Gambrell in Dubai, United Arab Emirates, and AP video producer Padmananda Rama contributed to this report. |
Should You Worry About Morses Club PLC's (LON:MCL) CEO Salary Level?
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The CEO of Morses Club PLC (LON:MCL) is Paul Smith. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Morses Club
According to our data, Morses Club PLC has a market capitalization of UK£188m, and pays its CEO total annual compensation worth UK£709k. (This number is for the twelve months until February 2019). We note that's an increase of 40% above last year. While we always look at total compensation first, we note that the salary component is less, at UK£293k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£79m to UK£315m. The median total CEO compensation was UK£545k.
Thus we can conclude that Paul Smith receives more in total compensation than the median of a group of companies in the same market, and of similar size to Morses Club PLC. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Morses Club, below.
Over the last three years Morses Club PLC has grown its earnings per share (EPS) by an average of 32% per year (using a line of best fit). Revenue was pretty flat on last year.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. Shareholders might be interested inthisfreevisualization of analyst forecasts.
Most shareholders would probably be pleased with Morses Club PLC for providing a total return of 74% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
We compared total CEO remuneration at Morses Club PLC with the amount paid at companies with a similar market capitalization. As discussed above, we discovered that the company pays more than the median of that group.
However we must not forget that the EPS growth has been very strong over three years. Even better, returns to shareholders have been plentiful, over the same time period. Considering this fine result for shareholders, we daresay the CEO compensation might be apt. Whatever your view on compensation, you might want tocheck if insiders are buying or selling Morses Club shares (free trial).
Arguably, business quality is much more important than CEO compensation levels. So check out thisfreelist of interesting companies, that have HIGH return on equity 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. |
Why Levi Strauss & Co. (NYSE:LEVI) Looks Like A Quality Company
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! 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). We'll use ROE to examine Levi Strauss & Co. ( NYSE:LEVI ), by way of a worked example. Our data shows Levi Strauss has a return on equity of 66% for the last year. Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.66. See our latest analysis for Levi Strauss How Do I Calculate ROE? The formula for return on equity is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Levi Strauss: 66% = US$449m ÷ US$686m (Based on the trailing twelve months to February 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company. What Does Return On Equity Signify? ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the profit over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal, investors should like a high ROE . That means it can be interesting to compare the ROE of different companies. Does Levi Strauss Have A Good Return On Equity? By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As is clear from the image below, Levi Strauss has a better ROE than the average (12%) in the Luxury industry. NYSE:LEVI Past Revenue and Net Income, June 21st 2019 That's clearly a positive. In my book, a high ROE almost always warrants a closer look. For example you might check if insiders are buying shares. Story continues The Importance Of Debt To Return On Equity Companies usually need to invest money to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Levi Strauss's Debt And Its 66% ROE Levi Strauss clearly uses a significant amount of debt to boost returns, as it has a debt to equity ratio of 1.52. There's no doubt its ROE is impressive, but the company appears to use its debt to boost that metric. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it. In Summary 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. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. 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 check this FREE visualization of analyst forecasts for the company . Of course Levi Strauss may not be the best stock to buy . So you may wish to see this free collection 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 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. |
Pan American Silver- A "Cheap" Way to Play Precious Metals
Gavin Grahamhas held senior positions in financial organizations in London, Hong Kong, and Toronto and is a trustee of the Royal Medical Foundation Investment Committee. Here, the contributing editor toInternet Wealth Builderlooks at a precious metals play.
One way of playing the rise in precious metals that is looking particularly cheap now is the second largest silver miner in the world,Pan American Silver(PAAS).
More from Gavin Graham:Canadian Natural Resources: Growth in the Oil Sands
Silver is selling near a 20-year low in terms of its relationship to gold, at levels which in the past have seen silver outperform gold as the ratio adjusts back to historical norms.
In addition, Pan American is down 34% over the last year and 24% year-to-date, largely due to the additional shares issued in its takeover of Tahoe Resources, a deal which many analysts feel has been misunderstood.
Vancouver-headquartered Pan American Silver is the world's second largest primary silver miner. The company produced 24.8 million ounces of silver and 179,000 ounces of gold in 2018 at an all-in sustaining cost (AISC) of $10.73 per ounce of silver (figures in U.S. dollars). Silver currently trades at $14.99 per ounce.
The company owns a diversified portfolio of assets including properties in such mining-friendly jurisdictions as Mexico, Peru, Canada, Argentina, and Bolivia. Following its takeover of Tahoe, it also owns the Escobal mine in Guatemala that is currently not producing.
Pan American is not merely the largest silver company by several measures but a very well managed mining company that has taken advantage of the bear market in precious metals to substantially expand at an attractive price.
While some investors have been worried about the suspension of Escobal, Tahoe's only producing silver mine, Pan American structured the deal so that Tahoe shareholders received so-called contingent value rights (CVRs).
See also:Corning: The Technology of Glass
Each CVR can be exchanged for 0.0497 of a Pan American share upon first commercial shipment of silver concentrate from Escobal following resumption of mining. The CVRs can be traded and have a 10-year life. If they are exercised, the percentage of Pan American owned by Tahoe shareholders rises from 27% to 32%.
In other words, Pan American will only end up paying for Escobal if it comes back into production. Escobal produced 21 million ounces of silver at an AISC of $8.63 during the last four quarters it was in operation. That was almost the same amount as Pan American's total silver production.
Guatemala's Constitutional Court has provided a process for resolution of the dispute that could lead to Escobal being reopened although there is no timeline at present. Even without Escobal reopening, Pan American will enjoy strong growth from the Tahoe gold operations and its COSE and Joaquin silver mines in Argentina, which are opening later this year.
It also has discovered a major new reserve at depth at its La Colorada mine in Mexico and will have its first reserve estimate later this year. Our current recommended action is "Buy". |
Nektar's Drug Could be a "Big Deal"
Nektar(NKTR) has a drug called NKTR-358 and they presented data from a clinical trial at EULAR (European League Against Rheumatism); in short NKTR-358 could be a very big deal, explains small cap expertTom Bishop, editor ofBI Research.
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It is a “novel IL-2 conjugate of a T-reg simulator.” IL-2 is interlukin-2, which is a stimulator of T- cells and in particular T-reg cells. T-reg cells are regulator T-cells that keep “effector” T-cells from attacking normal tissue, as occurs in auto-immune diseases like lupus (SLE) and rheumatoid arthritis and a host of auto-immune diseases.
Auto-immune disease are when the body’s built in defenses (T-cells) attack good tissue instead of just the foreign invasions they normally fend off.
T-reg cells normally keep those effector T-cells (which we all have, and need) in check. However when the T-reg cells’ influence becomes weak, the body (the effector T-cells) can turn on itself and we can get one of a host of auto-immune diseases.
So, NKTR-358 is a form of IL-2 (but not just straight up IL-2 which has limitations like a 1-hour half-life vs. 8-9 days for NKTR-358 and that IL-2 will stimulate all T-cell growth not just T-regs) that stimulates the T-reg cells to multiply and be more effective in doing their job of keeping the effector T cells from turning on the body that they were actually designed to protect from foreign intrusions (don’t attack the host guys!).
See also:Corning: The Technology of Glass
NKTR-358 which employs a low dose IL-2 conjugate has been proven in this recently reported clinical trial in healthy humans to be safe and to selectively activate T-regs without stimulating the out of control effector T-cells.
Accordingly the company has already advanced NKTR-358 into a clinical trial in lupus (SLE) patients, with trials on four more auto-immune diseases now in the planning stages and likely to be announced before year end. NKTR-358 is expected to be taken chronically, though later on likely at maintenance doses.
NKTR-358 is being developed in partnership withEli Lilly(LLY). Due to its mechanism of action it could, as with cancer fighting drug NKTR-214, find its way into combination therapies with other companies’ drugs.
Indeed it has already been tested with cyclosporine pre-clinically to great success. So lots of blue sky and promise here ... as if we needed more on top of that for NKTR-181 and NKTR-214. The shares, which have traded over $100, remain a Buy here under $40. |
Canopy Growth Q4 Results: The Good News and the Bad News
Save the best for last? That's what shareholders ofCanopy Growth(NYSE: CGC)were hoping for as they awaited the latest quarterly update from the world's largest cannabis producer by market cap.
Canopy's peers, includingAurora Cannabis,Cronos Group, andTilray, already reported their results for the last quarter. Investors were eager to find out if Canopy's Q4 numbers would dazzle even more than the other big Canadian cannabis producers' revenue numbers did.
Canopy Growth announced its fiscal 2019 fourth-quarter results after the market closed on Thursday. Here's what you need to know about the company's Q4 update.
Image source: Getty Images.
Canopy's most anticipated number announced Thursday evening was its Q4 net revenue of 94.1 million Canadian dollars. This total reflected a 313% year-over-year jump and was 13% higher than net revenue posted in the previous quarter. It also narrowly beat the consensus analyst revenue estimate of CA$93.7 million.
As expected, sales to the Canadian adult-use recreational cannabis market generated most of the company's growth. Canopy reported recreational cannabis revenue of CA$68.9 million. This amount more than doubled the CA$29.6 million in recreational cannabis salesreported by Aurora Cannabis in its last quarter. There's no doubt that Canopy Growth continues to reign as king in the Canadian market.
The company received a nice boost to its top line from its acquisition of German vaporizer device maker Storz & Bickel in December 2018. Storz & Bickel, along with other sources including extraction services and clinical partnerships, contributed an additional $34 million in growth for Canopy in Q4.
Canopy also continued to enjoy a huge cash stockpile, thanks to its big investment fromConstellation Brandsand its senior convertible note offering last year. The company reported cash, cash equivalents, and marketable securities totaling CA$4.5 billion as of March 31, 2019.
Not everything about Canopy Growth's Q4 update was so great. The company's gross recreational cannabis sales in the quarter of CA$68.9 million were nearly 4% lower than they were in Q3.
Medical cannabis sales also headed in the wrong direction. Canopy reported total Canadian medical cannabis sales in Q4 of CA$11.6 million, a 41% decrease from the previous quarter. The company attributed this decline to a transition of several of its brands to the recreational market and product supply challenges that have now been resolved.
Canopy also saw international medical cannabis sales slip. It announced international medical cannabis gross revenue of CA$1.6 million in Q4. That reflected a 25% year-over-year drop. Canopy said that European sales were negatively impacted by supply challenges in Canada, with the company prioritizing its Canadian customers.
The ugliest number in Canopy Growth's Q4 results was its net loss of CA$323.4 million, or CA$0.98 per share. This reflected significant deterioration from the net loss of CA$54.4 million, or CA$0.31 per share, in the prior-year period.
It also was a big swing from the company's earnings of CA$74.9 million, or CA$0.22 per share, posted in the third quarter. That nice profitcame with an asterisk, though: It was a result of the fair value of Canopy's senior convertible notes decreasing significantly because its share price dropped in Q3.
Perhaps the best news for Canopy Growth in its Q4 results was that good things are on the way. Canopy doubled its harvest size from Q3 to Q4 and expects another doubling from Q4 to Q1. It also expects its Danish production to come online in 2019.
At the same time, the company looks for increased sales as brick-and-mortar retail locations open in Ontario, Alberta, and British Columbia. In addition, Canopy has begun to sell medical cannabis in new markets, including Australia. And with additional capacity in its Canadian and Danish facilities, the company should have significantly more product to sell in key European markets.
Canopy also made another announcement on Thursday that should be important to its future fortunes. Shareholders of bothAcreage Holdingsand Canopy voted to approve theagreement for Canopy to acquire Acreagepending changes to U.S. federal marijuana laws. This sets the stage for Canopy to enter the U.S. marijuana market if and when those laws are revised.
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Keith Speightshas no position in any of the stocks mentioned. The Motley Fool recommends Constellation Brands. The Motley Fool has adisclosure policy. |
Lloyds fined £45 million by the Financial Conduct Authority for HBOS failures over Reading scandal
LLOYDS Banking Group was today hit with a £45.5 million fine for the failure of its Bank of Scotland arm to tell the City watchdog about suspicions of fraud at its now-notorious Reading branch.
The Reading branch of the giant Halifax Bank of Scotland, which merged with Lloyds in 2008 to prevent it from going bust, had an “Impaired Assets” business which preyed on vulnerable small companies.
The bankers, led by Lynden Scourfield and Mark Dobson, employed “turnaround consultants” David Mills and Alison Mills to run what a judge called an “utterly corrupt scheme” which grabbed the assets of small firms and sent many of them into bankruptcy.
The proceeds were spent partly on prostitutes and parties. Six people were convicted of fraud and corruption and sent to prison in 2017. Scourfield got 11 years. Judge Martin Beddoe told him he had “sold your soul, for sex, for luxury trips with and without your wife — for bling and for swag”.
The Financial Conduct Authority, which fined Lloyds, said prior to the merger Bank of Scotland had “failed to alert the regulator and the police about suspicions of fraud”.
Mark Steward, the FCA enforcement director, said: “There is no evidence anyone properly addressed their mind to this matter or its consequences. The result risked substantial prejudice to the interests of justice.”
Investigations into ex-senior HBOS people continue. James Crosby, who was chief executive of the bank until 2006, renounced his knighthood in 2013.
Antonio Horta-Osorio, chief executive of Lloyds Banking Group, said: “2007-2009 was a dark period in HBOS’s history. I want to apologise once again for the very deep distress caused.”
Lloyds said it has made offers of compensation to all the business owners affected.
Allegations about the Reading branch were reported to the watchdog, the Serious Fraud Office and the Treasury as far back as 2007.
Nikki Turner, director of the SME Alliance and a victim of HBOS Reading, said: “For a massive bank, £45 million is small change. This fine underlines the massive failures at HBOS which led to hundreds of hard-working businesspeople losing their businesses and livelihoods.”
A court heard a diary entry from one of the prostitutes used by the bankers read: “Met guys, me, Amber and Suzie. Chinese meal. Then drinks at flat and quick shag. Easy £1,500.” |
Latest Binance Coin price and analysis (BNB to USD)
Binance Coin (BNB) is currently trading at around $37 following some consolidation after a major rally upwards earlier in the week. Overall, price has increased almost 6% against the dollar since last week. Although sellers were in control during early June, price hasn’t dropped substantially. On the contrary, price is now pushing up to new yearly highs, showing signs the market is still looking for more gains. In addition, and despite the recent 7,000 BTC hack, Binance has been able to shake off any lasting impacts pretty easily. CZ was quite the gentleman when he took to Twitter to address the issue just a few hours after it happened. Let’s take a look at the chart for BNB. Last week, I said that if BNB is able to find new support around $30, we could soon see a run towards new highs well above $38, which eventually happened. Volumes also seem to be improving, which could mean we’re getting ready for a nice weekend pump. Looking at the recent weekend data, I really see no other option than the rally continuing. Current support can be found above the 20-day EMA between $32-$34, as buyers are clearly supporting that price level. The short-term trend seems to be bullish, so I would expect Binance to keep pushing upwards. After all, IEOs will be the next big thing in crypto – at least for the next year or so. As BNB is the go-to coin for investment in crypto-seed companies within the exchange, I don’t see any reason for a drop soon. About Binance Binance is currently the world’s second-largest cryptocurrency exchange, with around $6 billion in assets traded in an average seven-day period. Binance’s rise to the top has been swift. Since its launch in July 2017, Binance has grown at a rapid rate. Binance was one of the first exchanges to reactivate user registrations at the peak of the 2017 bull market. Binance is also the name of a cryptocoin (BNB) traded and used on the Binance exchange. Since the ICO, the value of BNB has risen with the growth of the exchange. BNB is now among the top 10 cryptocurrencies in the world by market cap. Story continues More Binance Coin news and information If you want to find out more information about BNB or cryptocurrencies in general, then use the search box at the top of this page. As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not. You may be interested in our range of cryptocurrency guides along with the latest cryptocurrency news . The post Latest Binance Coin price and analysis (BNB to USD) appeared first on Coin Rivet . |
How Much Of Levi Strauss & Co. (NYSE:LEVI) Do Insiders Own?
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A look at the shareholders of Levi Strauss & Co. (NYSE:LEVI) can tell us which group is most powerful. 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.'
Levi Strauss is a pretty big company. It has a market capitalization of US$8.5b. Normally institutions would own a significant portion of a company this size. In the chart below below, we can see that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about LEVI.
Check out our latest analysis for Levi Strauss
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
We can see that Levi Strauss does have institutional investors; and they hold 9.9% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. 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 Levi Strauss's earnings history, below. Of course, the future is what really matters.
Levi Strauss is not owned by hedge funds. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that insiders own more than half of Levi Strauss & Co.. This gives them effective control of the company. That means insiders have a very meaningful US$5.6b stake in this US$8.5b business. Most would argue this is a positive, showing strong alignment with shareholders. You canclick here to see if they have been selling down their stake.
The general public holds a 25% stake in LEVI. 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.
It's always worth thinking about the different groups who own shares in a company. But to understand Levi Strauss better, we need to consider many other factors.
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.
Ultimatelythe future is most important. You can access thisfreereport on analyst forecasts for the company.
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. |
Debt-Saddled Millennials Are Rushing Into Home Ownership—And It's Costing Them
Debt has come to serve as a defining trait for millennials—about 60% don’t haveenough savingsto handle a $1,000 emergency bill—but a lack of education can make a tough financial situation even harder than it has to be.
Speaking atFortune’sBrainstorm Finance conference in Montauk on Thursday, Hugh Frater, CEO ofFannie Mae, and Anand Cavale, head of consumer lending at SoFi, said one of the biggest money challenges among millennials is a lack of critical knowledge when it comes to things like home buying and paying off student debt.
Homeownership is up, and millennials are fueling that growth, Frater said, but they often come into the process with little knowledge on how exactly it works.
“One of the things we see is that there is inadequate consumer education around what it means to buy a home, what it means to get a mortgage. Completely inadequate,” Frater said. “One of the things that always astounds us is that more than 90% of homebuyer education is accessed after the buyer has an accepted offer.”
The same is true forstudent debt.
“People need to know they can refinance when the rate goes down and reduce their burden,” Cavale said. “Normally when interest goes down, they refinance their mortgages. It’s very well-known. But if somebody is carrying $80-, $90-, $100,000 worth of debt, and they don’t take the opportunity to refinance, which could save them $100s on a monthly basis, that’s a crime.”
As technology advances, it’s become easier to get a loan or mortgage, but Frater stresses that without crucial knowledge, consumers are still at a disadvantage.
“We can take those pain points out, but I think it’s still super important for people to know what they’re getting into,” he said. “Our job as a provider of liquidity is not to put people in the house of their dreams, it’s to put people in the house of their dreams that they can afford.”
—Brainstorm Finance 2019: Watch the livestreamof the inaugural conference
—Andreessen Horowitz: HowFacebook’s Libra cryptocurrencywill be governed
—Welcome to the next generation ofcorporate phishing scams
—Western Union and Zelle dishon the competition and talk mobile payments
—Millennials arenot basement-dwelling potheads, says Wealthfront CEO
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Announcing: E*TRADE Financial (NASDAQ:ETFC) Stock Increased An Energizing 117% In The Last Five Years
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The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But when you pick a company that is really flourishing, you canmakemore than 100%. For instance, the price ofE*TRADE Financial Corporation(NASDAQ:ETFC) stock is up an impressive 117% over the last five years.
See our latest analysis for E*TRADE Financial
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
During five years of share price growth, E*TRADE Financial achieved compound earnings per share (EPS) growth of 52% per year. This EPS growth is higher than the 17% average annual increase in the share price. So one could conclude that the broader market has become more cautious towards the stock. This cautious sentiment is reflected in its (fairly low) P/E ratio of 11.05.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. Before buying or selling a stock, we always recommend a close examination ofhistoric growth trends, available here..
E*TRADE Financial shareholders are down 30% for the year (even including dividends), but the market itself is up 6.4%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 17%, 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. It is all well and good that insiders have been buying shares, but we suggest youcheck here to see what price insiders were buying at.
E*TRADE Financial is not the only stock insiders are buying. So take a peek at thisfreelist of growing companies with insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US 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. |
HBC approves $29.4 million pay for CEO Helena Foulkes, making her among highest paid in Canada
Hudson’s Bay Co.shareholders approved a plan to pay chief executive Helena Foulkes $29.4 million, a decision that would make her among the highest paid executives in Canada.
Shareholders voted on the HBC’s approach to executive compensation for the 2018 financial year during Wednesday’s annual meeting, which was closed to media. While the non-binding vote on the pay package plan passed, 26.5 per cent of shareholders had voted against it. According to HBC documents, the board "will take the results of this vote into account when it considers future compensation policies and issues."
Foulkes, who joined HBC last February, has been tasked with turning around the struggling retailers performance. Throughout her tenure, she has repeated that “everything is on the table” when it comes to improving HBC’s operations and, so far, she has made several bold moves. Some of those include selling its Gilt deals website, shuttering its Home Outfitters business in Canada and shrinking the Lord & Taylor department store chain’s footprint.
In an information circular released to shareholders last month, HBC said that the company needed to provide Foulkes – who was previously president of CVS Pharmacy in the U.S. – with a one-time new hire stock option, which would incentivize her to create value over the long-term.
“In order to attract Ms. Foulkes, the (Human Resources and Compensation Committee) determined that it was necessary and in the best interest of the company to provide a one-time new hire grant of stock options to create alignment with shareholders’ interests, and incentivize the CEO to drive long-term value creation,” the company said in its information circular.
Foulkes compensation plan includes a base salary of $1.6 million, an annual incentive plan that brought in $5.7 million, and share-based awards that totalled $19.6 million.
“The one-time bonus and (long-term incentive) awards provided to Ms. Foulkes to make up for compensation forfeited due to her resignation from her former employer will not be provided in future years,” the company said.
HBC barred media from its annual general meeting Wednesday and did not stream the proceedings via webcast, moves that signalled a departure from previous years, according to archived webcasts on its website.
Foulkes’ compensation would make her the second-highest paid CEO in Canada based on 2017 data compiled in areport by the Canadian Centre for Policy Alternatives. In 2017, when the most recent data is available from, the highest paid chief executive was HBC’s Richard Baker, whose compensation topped $54.8 million, followed by Magna International Inc.’s Don Walker ($26.4 million). The highest paid woman on the list was Linamar’s Linda Hasenfratz, who was paid $16.5 million.
The decision about executive compensation comes as HBC considers a controversial go-private offer from a majority group of shareholders.
This week, activist shareholder Land & Buildings Investment Management LLCslammed the proposed offerfrom the majority shareholder group, calling the bid “woefully inadequate.”
In a letter sent to HBC’s special committee reviewing the bid, Land & Buildings founder Jonathan Litt urged the company to explore other transactions that could “maximize value for all shareholders.”
The letter points to a statement made by Foulkes last year that pegged the value of the company’s real estate at $28 per share – well above the go-private offer of $9.45 per share.
The group of shareholders, which includes HBC’s former CEO and now executive chairman Baker, controls 57 per cent of the company’s shares.
With files from the Canadian Press
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3 Presidential Candidates Who Previously Broke From Their Party on Social Security
Social Security is arguably one of the most important social programs in this country. It provides benefit checks to more than 63 million retirees, disabled workers, and survivors of deceased workers each month and is singlehandedly keeping more than 22 million people, many of whom are senior citizens, out of poverty.
And yet, despite its importance, it's often swept under the rug by lawmakers in Washington for being too much of a hot-button topic. While it's as plain as day that Social Security is in trouble over the long run and needs a fix,lawmakers fear the backlashthat could ensue when tough decisions are made. That makes Social Security a highly watched issue as we head toward the 2020 election, as well as one that continually gets pushed to the wayside by candidates.
However, the field of more than two dozen presidential candidates can't hide from their previous commentary and track records. After some digging, three candidates emerged as having, at one time, broken with their political party's core resolutions on Social Security.
Then-Vice President Joe Biden listening to then-President Barack Obama during a meeting. Image source: Official White House photo by Pete Souza.
Former vice president and current Democratic front-runner Joe Biden shares a lot in common with his party on Social Security. He strongly opposes privatization, and favors the idea of lifting the payroll tax cap to require the rich to pay more into the system. But Biden has,on more than one occasion, taken a centrist, or downright Republican approach to fixing Social Security.
In 2007, Biden took this approach by stating that tax increasesandraising the retirement agewould both be on the table should he become president, according toNBC News. Raising the full retirement age would protect the payouts of current and near-term retirees, but would require future generations of workers (Gen X, millennials, and Gen Z) to either wait longer to receive their full payout, or to accept an even steeper permanent reduction by claiming early. Either way, it's designed to lower the lifetime benefits received by today's younger workers.
Looking back even further, Biden once went so far as to call for a freeze on government spending, including Social Security and Medicare, back in 1995. Said Biden,courtesy of C-Span:
"For example, I'm going to go on record. I'm up for reelection this year, and I'm going to remind everybody what I did at home, which is going to cost me politically. When I argued that we should freeze federal spending, I meant Social Security, as well. I meant Medicare and Medicaid. I meant veterans' benefits. I meant every single solitary thing in the government. And I not only tried it once -- I tried it twice, I tried it a third time, and I tried it a fourth time. Somebody has to tell me in here how we're going to do this hard work without dealing with any of those sacred cows, some deserving more protection than others."
Though it's unlikely that Biden would take such a hard-line stance today, there's no denying that his views on Social Security aren't perfectly aligned with the Democratic Party.
President Trump meeting with President Duda of Poland. Image source: Official White House photo by Shealah Craighead.
Sure, Donald Trump is the president right now, but by the time November 2020 rolls around, he'll be a candidate once again.
Consistent with GOP ideology, Trump has looked for ways to modestly reduce long-term program costs. This includes a handful of fiscal budget proposals that called forreductions to the Social Security Disability Insurance program. But Trump hasn't always offered policies that have been consistent with Republican ideology.
InThe America We Deserve, released in 2000, Trump proposed a one-time tax of 14.25% on individuals and trusts with a net worth of more than $10 million. This one-time tax would have raised $5.7 trillion, which, back in 2000, would have wiped out America's national debt. By Trump's account, removing this debt would save the federal government $200 billion a year. Half of this savings was to be put toward a 10-year middle-class tax cut, for an aggregate of $1 trillion over a decade. The remaining $100 billion was to be placed annually in Social Security's asset reserves, thereby keeping the program solvent for the next century. In other words, Trumpproposed taxing the rich to save Social Security!
Even though Republicans distanced themselves from George W. Bush's signature idea ofpartially privatizing Social Securityin 2005, Trump also notes inThe America We Deservethat workers should have their choice of investment options in private accounts. Essentially, "The Donald" supported partial privatization of the program back in 2000.
In short, Trump and the GOPdon't always see eye-to-eye on Social Security.
New Jersey Sen. Cory Booker (right) speaking at a press conference. Image source: Cory Booker Senate web page.
Depending on the poll, New Jersey Sen. Cory Booker ranks as the fourth-, fifth-, or sixth-most popular Democrat in the presidential race at the moment. Of course, it's early, and things tend to change quite a bit as primaries kick off.
Like most Democrats, Booker believes in the core Social Security principles of having the rich pay their fair share, upping the cost-of-living adjustment so seniors receive more each year, and generally opposing any reductions to benefits. This is all par for the course inDemocratic ideology in fixing Social Security.
However, Booker has slightly sidestepped his party when it comes to Social Security's full retirement age debate. Although he strongly opposes gradual increases to the retirement age in the near term, he's been quoted as supporting an increase to the full retirement age for people in their 20s or younger.
One of the biggest problems with the full retirement age is that it will have risen by a mere two years (from 65 to 67) between 1940, the year of the first payout, and 2022. All the while, the average life expectancy in the U.S. hasgrown by nine years just since 1960. More people are living to their claiming age, and the average life expectancy for those reaching 65 years of age is another 20 years. Social Security was never built to support seniors for decades, and it appears Booker understands the need to adjust the program for increased longevity many years down the road.
Since abipartisan solutionwould more than likely give Social Security its best chance at long-term success, the willingness of these three presidential candidates to look at solutions beyond their party lines makes them worth closely watching.
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Are Corindus Vascular Robotics, Inc.'s (NYSEMKT:CVRS) Interest Costs Too High?
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Corindus Vascular Robotics, Inc. (NYSEMKT:CVRS) is a small-cap stock with a market capitalization of US$620m. While investors primarily focus on the growth potential and competitive landscape of the small-cap companies, they end up ignoring a key aspect, which could be the biggest threat to its existence: its financial health. Why is it important? Since CVRS is loss-making right now, it’s vital to assess the current state of its operations and pathway to profitability. Let's work through some financial health checks you may wish to consider if you're interested in this stock. However, this is just a partial view of the stock, and I suggest youdig deeper yourself into CVRS here.
CVRS's debt levels surged from US$12m to US$15m over the last 12 months , which includes long-term debt. With this increase in debt, the current cash and short-term investment levels stands at US$38m , ready to be used for running the business. Moving on, operating cash flow was negative over the last twelve months. As the purpose of this article is a high-level overview, I won’t be looking at this today, but you can examine some of CVRS’soperating efficiency ratios such as ROA here.
With current liabilities at US$9.4m, the company has been able to meet these obligations given the level of current assets of US$45m, with a current ratio of 4.72x. The current ratio is the number you get when you divide current assets by current liabilities. Having said that, a ratio above 3x may be considered excessive by some investors.
CVRS is a relatively highly levered company with a debt-to-equity of 57%. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. Though, since CVRS is currently unprofitable, sustainability of its current state of operations becomes a concern. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns.
Although CVRS’s debt level is towards the higher end of the spectrum, its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. I admit this is a fairly basic analysis for CVRS's financial health. Other important fundamentals need to be considered alongside. I suggest you continue to research Corindus Vascular Robotics to get a more holistic view of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CVRS’s future growth? Take a look at ourfree research report of analyst consensusfor CVRS’s outlook.
2. Historical Performance: What has CVRS's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor 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. |
QuadrigaCX CEO Faked Crypto Trades, Indulged Millionaire Lifestyle with Customer Funds
ByCCN Markets: Gerald Cotten, the CEO of the Canadian crypto exchange QuadrigaCX whose death is the reason for$190 million of missing fundsand a bankrupt company, had transferred user funds to his personal accounts to use them as security for margin trading, a report by Ernst & Young revealed.
After Cotten had died, QuadrigaCX went offline as the company’s CEO had exclusive access to the wallets where the exchange’s funds were held. In April, the Canadian cryptocurrency exchangedeclared bankruptcy.
The Nova Scotia Supreme Court granted Quadriga protection from their creditors, and Ernst & Young was hired to monitor the defunct crypto exchange in the creditor proceedings.
Now, after four months of investigation, EY haspublishedits fifth report, revealing multiple incidents where Cotten had misappropriated Quadriga user funds.
Read the full story on CCN.com. |
UPDATE 1-France creates G7 cryptocurrency task force as Facebook's Libra unsettles governments
(Adds quotes, details throughout)
PARIS, June 21 (Reuters) - France is creating a G7 task force to study how central banks ensure cryptocurrencies like Facebook's Libra are governed by regulations ranging from money-laundering laws to consumer-protection rules, France's central bank governor said on Friday.
Governor Francois Villeroy de Galhau said the task force would be led by Benoit Coeure, a European Central Bank board member.
Facebook Inc announced plans this week to introduce a new global cryptocurrency called Libra, part of an effort to expand into digital payments.
It has joined with 28 partners, including Mastercard, PayPal and Uber, to form Libra Association, a Geneva-based entity that will govern the new digital coin, according to marketing materials and interviews with executives. No banks are yet part of the group.
Facebook's announcement drew a fast, worried reaction. The U.S. Senate Banking Committee said it would hold a hearing on the plans next month. David Marcus, who oversees Facebook's blockchain efforts, is expected to testify, according to a source in Washington familiar with the matter.
Bank of England Governor Mark Carney said Libra had to be safe or it would not happen, and that the world's major central banks would need to have oversight.
France, which holds the rotating presidency of the Group of Seven nations, has said it does not oppose Facebook's creating an instrument for financial transactions. But it adamantly opposes that instrument becoming a sovereign currency. "We want to combine being open to innovation with firmness on regulation. This is in everyone's interest," Villeroy told finance industry officials.
The concept of a "stable" cryptocurrency still needs to be defined, Villeroy said. In particular, what such instruments are stable against and how fixed their exchange rates are need to be determined.
Villeroy also called for a network of national anti-money-laundering authorities, coordinated by the European Banking Authority, to carry out emergency measures and even substitute for national authorities, rather than creating a specialised European agency.
Several ECB officials, including Coeure, have argued in favor of creating such an agency over the past months. . (Reporting by Inti Landauro; writing by Richard Lough; editing by Luke Baker, Larry King) |
Do Directors Own Corindus Vascular Robotics, Inc. (NYSEMKT:CVRS) Shares?
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A look at the shareholders of Corindus Vascular Robotics, Inc. (NYSEMKT:CVRS) 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. Companies that have been privatized tend to have low insider ownership.
Corindus Vascular Robotics is not a large company by global standards. It has a market capitalization of US$620m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about CVRS.
View our latest analysis for Corindus Vascular Robotics
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
We can see that Corindus Vascular Robotics does have institutional investors; and they hold 22% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Corindus Vascular Robotics, (below). Of course, keep in mind that there are other factors to consider, too.
It would appear that 20% of Corindus Vascular Robotics shares are controlled by hedge funds. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that Corindus Vascular Robotics, Inc. insiders own under 1% of the company. It appears that the board holds about US$5.6m worth of stock. This compares to a market capitalization of US$620m. I generally like to see a board more invested. However it might be worth checkingif those insiders have been buying.
With a 38% ownership, the general public have some degree of sway over CVRS. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
With an ownership of 6.4%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. 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.
Public companies currently own 13% of CVRS stock. We can't be certain, but this is quite possible this is a strategic stake. The businesses may be similar, or work together.
It's always worth thinking about the different groups who own shares in a company. But to understand Corindus Vascular Robotics better, we need to consider many other factors.
I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow, for free.
But ultimatelyit is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look atthis free report showing whether analysts are predicting a brighter 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. |
Oracle Corporation (NYSE:ORCL): Are Analysts Bullish?
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In June 2019, Oracle Corporation (NYSE:ORCL) released its latest earnings announcement, which revealed that the business gained from a major tailwind, more than doubling its earnings from the prior year. Below is my commentary, albeit very simple and high-level, on how market analysts perceive Oracle's earnings growth trajectory over the next few years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings.
Check out our latest analysis for Oracle
Market analysts' prospects for this coming year seems pessimistic, with earnings declining by -2.9%. But in the following year, there is a complete contrast in performance, with reaching double digit 1.7% compared to today’s level and continues to increase to US$12b in 2022.
Even though it’s informative understanding the growth year by year relative to today’s value, it may be more insightful gauging the rate at which the business is moving on average every year. The pro of this approach is that we can get a better picture of the direction of Oracle's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To calculate this rate, I've appended a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 1.3%. This means, we can presume Oracle will grow its earnings by 1.3% every year for the next few years.
For Oracle, I've compiled three important factors you should further examine:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is ORCL worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether ORCL is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ORCL? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
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. |
Jeremy Kyle plots return to TV with two new shows
Jeremy Kyle is set to make his ITV comeback with new episodes of 'The Kyle Files' and another secret show (Anthony Harvey/Getty) Jeremy Kyle is set to make his ITV comeback with a new series of The Kyle Files and another programme, which is still in development. His fate with the UK network was left uncertain when tabloid talk show The Jeremy Kyle Show - which he had fronted since 2005 - was cancelled following the death of a former guest . Now though, a source has told the Mirror that The Kyle Files will be back as usual in early 2020 and another show is being sought for him. Having premiered in 2015, The Kyle Files sees the 53-year-old investigates social issues, from knife crime and dangerous driving to the increasing number of homeless people throughout the UK. Read more: Kerry Katona labels Jeremy Kyle an 'arrogant little t***' Late construction worker Steve Dymond had taped an episode of the controversial reality series back in April, which saw his fiancée Jane Callaghan confront him after he failed a lie detector test when asked about his suspected infidelity. He was found dead at his home in Portsmouth just ten days later. It has been reported that his death is a suspected suicide. Steve Dymond was found dead in his home in Portsmouth days after filming an episode of 'The Jeremy Kyle Show' (Steve/Dymond/Facebook) Speaking about the incident, Kyle said at the time: Myself and the production team I worked with for the last 14 years are all utterly devastated by the recent events. Our thoughts and sympathies are with Steves family at this incredibly sad time. Dymonds death sparked an investigation into the aftercare participants receive after appearing on the show. Shortly after, ITV CEO Carolyn McCall said the broadcaster was pulling the plug on the long-running daytime series. ITV are developing another programme for Jeremy Kyle to front in the coming months (PAUL ELLIS/AFP/Getty Images) Given the gravity of recent events we have decided to end production of The Jeremy Kyle Show , she said in a statement. [It] has had a loyal audience and has been made by a dedicated production team for 14 years, but now is the right time for the show to end. More recently, Kyle refused to appear before before the Digital, Culture, Media and Sport Committee to give evidence as part of the ongoing inquest surround Dymonds death. Story continues Read more: Ex-partner of late 'Jeremy Kyle' guest Steve Dymond says she's being made out to be 'a bad person' Chairman Damian Collins told MPs on 18 June: We believe that Jeremy Kyle himself should be an important witness to that as the show is based around him as the lead presenter of it. "We have sent an invitation to Mr Kyle through his representatives. And we have received word back from them that he has declined to appear in front of the committee on Tuesday next week." |
Bank of Scotland fined £45m over failure to report fraud suspicions
Photo: Getty CORRECTION UPDATE: An image of RBS instead of Bank of Scotland was used in this article previously. It has now been replaced. Bank of Scotland on Friday was fined £45.5m by the Financial Conduct Authority (FCA) for failing to report suspicions of fraud at its Reading branch more than a decade ago. The regulator found that the bank “failed to be open and cooperative and failed to disclose information appropriately” to its predecessor, the Financial Services Authority. In early 2007, the bank discovered that a director of the branch, Lynden Scourfield, had acted beyond his remit for at least three years by sanctioning limits and additional lending facilities. The branch was part of Halifax Bank of Scotland (HBOS), which is now owned by rival Lloyds Banking Group. The bank did not report the fraud until more than two years later — in July 2009 — and the regulator said on Friday that there was “no evidence anyone properly addressed their mind to this matter or its consequences.” “[Bank of Scotland]’s failures caused delays to the investigations by both the FCA and Thames Valley Police,” the director of enforcement at the regulator, Mark Steward, said. “There was insufficient challenge, scrutiny or inquiry across the organisation and from top to bottom. At no stage was all the information that had been identified properly considered,” he said. “There is also no evidence anyone realised, or even thought about, the consequences of not informing the authorities, including how that might delay proper scrutiny of the misconduct and prejudice the interests of justice.” |
What Kind Of Shareholders Own BSR Real Estate Investment Trust (TSE:HOM.UN)?
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A look at the shareholders of BSR Real Estate Investment Trust (TSE:HOM.UN) can tell us which group is most powerful. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. We also tend to see lower insider ownership in companies that were previously publicly owned.
BSR Real Estate Investment Trust is a smaller company with a market capitalization of CA$482m, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have bought into the company. Let's delve deeper into each type of owner, to discover more about HOM.UN.
View our latest analysis for BSR Real Estate Investment Trust
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that BSR Real Estate Investment Trust does have institutional investors; and they hold 6.7% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see BSR Real Estate Investment Trust's historic earnings and revenue, below, but keep in mind there's always more to the story.
BSR Real Estate Investment Trust is not owned by hedge funds. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
We can see that insiders own shares in BSR Real Estate Investment Trust. As individuals, the insiders collectively own CA$4.9m worth of the CA$482m company. It is good to see some investment by insiders, but it might be worth checkingif those insiders have been buying.
The general public holds a 26% stake in HOM.UN. 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.
It seems that Private Companies own 7.7%, of the HOM.UN 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.
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
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.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss thisfreereport on analyst forecasts.
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. |
Vegan meat replacements to make up 60% of global market by 2040
More vegan meat products are now being offered at UK supermarkets. Photo: Richard B Levine/SIPA USA/PA Images Vegan meat replacements are set to overtake real meat products by 2040, according to new research. A report by consultancy firm AT Kearney based on interviews with industry experts predicts 60% of the “meat” products Brits consume in 2040 will be plant-based replacements or cultured alternatives. According to AT Kearney, this change is likely to be driven by concerns about the environmental impact of meat production and animal welfare. READ MORE: Vegan firm's use of word “cheese” grates dairy industry The livestock industry is now “viewed by many as an unnecessary evil”, the report’s authors stated. They predicted: “With the advantages of novel vegan meat replacements and cultured meat over conventionally produced meat, it is only a matter of time before they capture a substantial market share.” They broke down the numbers surrounding livestock and their impact on harvest production, stating nearly half of the worldwide harvest is required to feed the livestock population and that twice as many humans could be fed if they consumed the harvest directly. READ MORE: We got a vegan and meat-eater to try a fermented soy burger with coconut oil cheese – here's what they thought The report predicted 35% of all meat will be cultured – produced by in-vitro cultivation of animal cells, instead of from slaughtered animals – in just over two decades, while a quarter will become vegan replacements. In light of this, a survey of 2,000 shoppers by app Ubamarket found Brits spend £25 per week on vegetarian and vegan products, totalling £1.3bn a year. Over a third (36%) of meat-eaters – representing 19 million Brits – are already buying vegetarian and vegan specialist products. READ MORE: Brits spent over £1.3bn on vegan and vegetarian products in 2018 And 32% – 16.72 million – are trying to eat less meat, for reasons ranging from health to the environmental impact, while 31% – 16 million – are eating more meat-free meals than ever. This is in part a result of charity campaigns such as Veganuary, with a quarter (26%) of Brits saying these trends have shaped their shopping habits. Story continues But a quarter of shoppers – 13 million Brits – find supermarket layouts make shopping for meat-free products difficult, according to the survey. READ MORE: We got a vegan and meat-eater to try London's first vegan “fish and chips” Recent changes in eating habits has meant that supermarkets had to adapt their in-store offering to changing consumer demand. As well as seeing an increased amount of vegan and vegetarian selections across the country, supermarkets like Tesco have announced plans to start selling vegan options in meat aisles to promote sustainability. The research shows shoppers find it difficult to locate speciality items in-store, leading to frustration and confusion, and that meat-free diets may be welcomed into the mainstream faster by supermarkets incorporating products into the general layout of a store rather than relegating them to a few shelves in the corner. READ MORE: When vegan is a dirty word Will Broome, CEO of Ubamarket, said: “The ever-increasing popularity of living meat-free lifestyles shows supermarkets should adapt to the increase in demand for vegetarian and vegan products. “The importance of having systems in place that grant freedom for shoppers to make their own dietary decisions has never been more apparent. “With more convenient store layouts and a smoother shopping format, consumers will be able to subscribe to alternative diets with ease.” |
Who Has Been Buying MediaValet Inc. (CVE:MVP) 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 inMediaValet Inc.(CVE:MVP).
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia Universitystudyfound that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
See our latest analysis for MediaValet
Executive Chairman & CFO Robert Chase made the biggest insider purchase in the last 12 months. That single transaction was for CA$80k worth of shares at a price of CA$0.025 each. Even though the purchase was made at a significantly lower price than the recent price (CA$0.035), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Over the last year, we can see that insiders have bought 9.9m shares worth CA$255k. While MediaValet insiders bought shares last year, they didn't sell. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
MediaValet is not the only stock that insiders are buying. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. MediaValet insiders own about CA$2.1m worth of shares. That equates to 25% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
The fact that there have been no MediaValet insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. Insiders do have a stake in MediaValet and their transactions don't cause us concern. Along with insider transactions, I recommend checking if MediaValet is growing revenue. This free chart ofhistoric revenue and earnings should make that easy.
But note:MediaValet 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. |
Stocks - Wall Street Lower on U.S-Iranian Tensions
Investing.com - Wall Street opened lower on Friday as fears of a possible war between the U.S. and Iran kept investor sentiment in check. The S&P 500 inched down 5 points or 0.2% of 10:12 AM ET (14:12 GMT). The Dow was flat and tech-heavy Nasdaq composite fell 23 points or 0.3%. U.S. President Donald Trump said via Twitter that he had come within minutes of firing missiles at Iran in response to it shooting down a surveillance drone. Tensions between the two countries have been fragile since the White House decided to withdraw from the UN-backed 2015 Iran nuclear agreement. The administration most recently accused Iran of last week's attacks on oil tankers in the Persian Gulf, which Tehran denies. Beyond Meat NASDAQ:BYND) slumped 3.4%, while Tesla (NASDAQ:TSLA) dipped 0.4% and Canopy Growth (NYSE:CGC) was down 8.1% after it reported a loss in its last quarter largely due to expansion costs. Elsewhere, Netflix (NASDAQ:NFLX) gained 1.2%, while Intel (NASDAQ:INTC) was up 0.5% and Advanced Micro Devices (NASDAQ:AMD) jumped 0.7%. UnitedHealth (NYSE:UNH) inched up 0.2% after The Wall Street Journal reported that it had agreed to buy health care payments firm Equian for $3.2 billion. In commodities, crude jumped 0.6% to $57.38 a barrel. Gold futures gained 0.2% to $1,399.65 a troy ounce, while the U.S. dollar index, which measures the greenback against a basket of six major currencies, fell 0.1% to 96.067. Related Articles Wall St. dips after strong rally as U.S.-Iran tensions escalate U.S. markets regulators reach deal on Dodd-Frank swaps capital rules Ex-Barclays CEO Varley cleared of fraud charges |
France to create G7 stablecoin taskforce following Libra’s announcement
France, which holds the Group of Seven (G7) presidency, will create the group taskforce on “stablecoin” projects, according to areportfrom Reuters on Friday. The news was announced by France’s central bank governor Francois Villeroy de Galhau. The taskforce will reportedly be headed by European Central Bank board member Benoit Coeure, and will also include Facebook’s planned cryptocurrency project, Libra.
Facebookunveiledits Libra project earlier this week, intending to bank the unbanked and facilitate low-fee money transfers globally. France’s finance minister Bruno Le Mairesaidat the time that Libra “can’t and…must not happen” and that “it is out of question’’ for the cryptocurrency to “become a sovereign currency.”
He also reportedly called on the G-7 central bank governors and guardians of the global monetary system to review the social media giant’s cryptocurrency project and submit a report next month.The Libra project is expected to go live sometime next year, but it has already facedscrutinyfrom central banks and politicians around the world. For instance, Markus Ferber, a German member of the European Parliament, warned that Facebook could become a “shadow bank” and said regulators should be vigilant. |
Pertamina in talks with Exxon, Chevron to buy H2 2019 Indonesian crude
JAKARTA, June 21 (Reuters) -
* Indonesia's state energy company Pertamina is still in talks with U.S. oil majors Chevron Corp and Exxon Mobil Corp to buy their share of Indonesian crude production for the second half this year, a senior Pertamina official said
* Pertamina wants to buy more domestic crude in order to reduce imports
* "Discussion with Chevron has, so far, been positive. But we can't promise any details because negotiations are still in process. With Exxon, we're still in discussion," Dharmawan Samsu, director of upstream at Pertamina told reporters late Thursday
* Pertamina inked a deal to buy 2.5 million barrels of Minas and Duri crude per month from Chevron in the first half of 2019
* Pertamina has yet to reach a deal to buy Banyu Urip crude from Exxon Mobil so far this year, Samsu said
* Industry sources said it was because prices were high
* It's "still on negotiation", Erwin Maryoto, VP Public and government affairs, ExxonMobil, told Reuters
* Chevron could not be immediately reached for comment (Reporting by Wilda Asmarini, Writing by Florence Tan, Editing by Sherry Jacob-Phillips) |
Here's Why I Think Regions Financial (NYSE:RF) Is An Interesting Stock
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For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it completely lacks a track record of revenue and profit. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses.
So if you're like me, you might be more interested in profitable, growing companies, likeRegions Financial(NYSE:RF). While profit is not necessarily a social good, it's easy to admire a business than can consistently produce it. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed.
View our latest analysis for Regions Financial
If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. That makes EPS growth an attractive quality for any company. As a tree reaches steadily for the sky, Regions Financial's EPS has grown 20% each year, compound, over three years. As a general rule, we'd say that if a company can keep upthatsort of growth, shareholders will be smiling. And for those who like the finer details, I'll add that the EPS growth has been helped by share buybacks, demonstrating that the business is positioned to return capital to its shareholders.
One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. Not all of Regions Financial's revenue this year is revenuefrom operations, so keep in mind the revenue and margin numbers I've used might not be the best representation of the underlying business. Regions Financial reported flat revenue and EBIT margins over the last year. That's not bad, but it doesn't point to ongoing future growth, either.
In the chart below, you can see how the company has grown earnings, and revenue, over time. Click on the chart to see the exact numbers.
The trick, as an investor, is to find companies that aregoing toperform well in the future, not just in the past. To that end, right now and today, you can checkour visualization of consensus analyst forecasts for future Regions Financial EPS100% free.
We would not expect to see insiders owning a large percentage of a US$15b company like Regions Financial. But we do take comfort from the fact that they are investors in the company. Given insiders own a small fortune of shares, currently valued at US$52m, they have plenty of motivation to push the business to succeed. This should keep them focused on creating long term value for shareholders.
It's good to see that insiders are invested in the company, but are remuneration levels reasonable? A brief analysis of the CEO compensation suggests they are. I discovered that the median total compensation for the CEOs of companies like Regions Financial, with market caps over US$8.0b, is about US$11m.
Regions Financial offered total compensation worth US$7.4m to its CEO in the year to December 2018. That comes in below the average for similar sized companies, and seems pretty reasonable to me. CEO compensation is hardly the most important aspect of a company to consider, but when its reasonable that does give me a little more confidence that leadership are looking out for shareholder interests. It can also be a sign of good governance, more generally.
You can't deny that Regions Financial has grown its earnings per share at a very impressive rate. That's attractive. If that's not enough, consider also that the CEO pay is quite reasonable, and insiders are well-invested alongside other shareholders. Each to their own, but I think all this makes Regions Financial look rather interesting indeed. Now, you could try to make up your mind on Regions Financial by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry.
Of course, you can do well (sometimes) buying stocks thatare notgrowing earnings anddo nothave insiders buying shares. But as a growth investor I always like to check out companies thatdohave those features. You can accessa free list of them here.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
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. |
Medic stuns navy Seal murder trial by saying he killed wounded Isis fighter, not the accused
A man left the murder trial of a decorated US navy S eal stunned after saying he killed a wounded Islamic State fighter himself – not the accused. Medic Corey Scott was called by prosecutors to testify at the military trial of special operations chief Edward Gallagher, who is accused of murdering a teenage militant in Iraq . But while he did say Mr Gallagher plunged a knife into the boy after treating him for wounds, the medic unexpectedly took the blame for the killing, claiming he suffocated him afterwards. Mr Scott said he held his thumb over the youngster’s breathing tube as an act of mercy because Iraqis would have tortured him to death had he survived. A prosecutor accused Mr Scott of lying, claiming he had told investigators a different story several times and changed it only after he was granted immunity and ordered to testify. Retired army major general John Altenburg Jr said: “So you can stand up there and you can lie about how you killed the Isis prisoner so Chief Gallagher does not have to go to jail. “You don’t want Chief Gallagher to go to jail, do you?” In response, Mr Scott said: “He’s got a wife and family. I don’t think he should be spending his life in prison.” Mr Gallagher has been charged with premeditated murder in the boy’s death and attempted murder in the shooting of civilians. The defence has said Mr Gallagher only treated the prisoner for a collapsed lung and that disgruntled sailors fabricated the murder accusations because he was a demanding platoon leader and they didn’t want him to be promoted. The US navy released a statement saying it would not drop the premeditated murder charge and that it was up to the jurors to decide the credibility of the witness. Before the stabbing, Mr Scott said that he and Mr Gallagher had stabilised the sedated prisoner who was wounded in an airstrike and that he was breathing normally through a tube inserted to clear his airway. The medic said he was shocked when Mr Gallagher stabbed the boy at least once below the collarbone. He said there was no medical reason for it and that Mr Gallagher then grabbed his medical bag and walked away. He told the courtroom at San Diego naval base: “I was startled and froze up for a little bit. “I knew he was going to die anyway, and I wanted to save him from waking up to whatever would happen to him.” Mr Scott added that no one asked him how the patient died. Four Seals and one former Seal have taken the stand. Mr Scott was the second to say he witnessed Mr Gallagher stab the militant. Story continues Several of the Seals also described instances when they said Mr Gallagher had fired at civilians, once shooting an old man. The seven-man jury is made up of five marines and two sailors – all veterans of war zones. A two-thirds majority – at least five – is needed to convict and anything less will end in acquittal. The navy said the jury can convict Mr Gallagher of a lesser charge, such as premeditated attempted murder, which carries a maximum penalty of life with parole. There is no minimum sentence. The trial continues. Associated Press contributed to this report View comments |
Did You Owe Money on Your Taxes This Year? You're in Good Company
Each year, the majority of people who file a tax return wind up getting arefund. And while that still held true for the 2019 tax season, a significant number of filers wound up in the opposite situation: They owed money to the IRS. In fact, in a recent survey for tax preparerJackson Hewittconducted by ResearchNow (now called Dynata), 36% of respondents said they owed money on their 2018 taxes, while 11% said they owed money for the first time in their lives.
Owing a little bit of money on your taxes isn't necessarily terrible. If anything, it means you got to hang on to some extra money and use it as you pleased. When you get a tax refund, the opposite holds true: You gave the government an interest-free loan by allowing it to retain some ofyourmoney for nothing in return.
Image source: Getty Images.
But not everyone who underpays taxes owes a small amount. If you wound up with, say, a $2,000 tax bill this year, that's a sum you might really struggle to come up with at once. And that could be problematic because for each month or partial month that your tax bill (or a portion of it) goes unpaid, you'll accrue interest and penalties that add to your total cost. You also risk having the IRS come after your wages if you don't pay your tax debt at all -- though that can be easily remedied by reaching out to the agency and getting on an installment plan.
If you owed a significant amount on your taxes this year, it pays to take steps to avoid a repeat. Otherwise, you could wind up just as stressed next tax season as you were this year.
A big reason so many filers wound up underpaying their taxes in 2018 boils down to changes in withholding. As part of the2018 tax overhaul, almost all individual tax brackets were lowered to put more money back into workers' paychecks, and the IRS released new withholding tables to accommodate that change. Many people, however, didn't realize that they should've checked their withholding to ensure that they were having the right amount of tax taken out of their earnings. And because they failed to do so, they wound up owing money to the IRS.
If you failed toadjust your withholdingin 2018, it's not too late for the current tax year. "We are urging taxpayers to talk to a tax professional about this year's withholdings to make sure they are withholding the right amount," says Mark Steber, chief tax officer at Jackson Hewitt. "Incorrect withholdings can lead to unpleasant surprises -- like a smaller-than-usual refund or even a balance due next year."
You should especially make sure to adjust your withholding if you owed a large amount of tax on your 2018 return, or if you bring in a substantial amount of income from a source outside of your main job, like work on the side or an investment portfolio. Your tax liability reflects yourtotalearnings, and income received outside of your primary job counts toward it.
At the same time, it's a good idea to stick some money in the bank if, despite your best efforts, youdowind up owing the IRS in 2020. Adjusting your withholding can help avoid a huge underpayment, but it may not prevent you from owing completely, so it never hurts to be prepared with cash to pay a potential tax bill. Doing so will help you avoid interest and penalties that make an already crummy situation even worse.
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What Do Analysts Think About The Future Of frontdoor, inc.'s (NASDAQ:FTDR)?
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Since frontdoor, inc. (NASDAQ:FTDR) released its earnings in March 2019, it seems that analyst forecasts are fairly optimistic, as a 5.7% increase in profits is expected in the upcoming year, against the past 5-year average growth rate of 3.5%. Currently with trailing-twelve-month earnings of US$125m, we can expect this to reach US$132m by 2020. In this article, I've outline a few earnings growth rates to give you a sense of the market sentiment for frontdoor in the longer term. Investors wanting to learn more about other aspects of the company shouldresearch its fundamentals here.
View our latest analysis for frontdoor
The longer term expectations from the 11 analysts of FTDR is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
From the current net income level of US$125m and the final forecast of US$196m by 2022, the annual rate of growth for FTDR’s earnings is 17%. EPS reaches $2.25 in the final year of forecast compared to the current $1.48 EPS today. Margins are currently sitting at 9.9%, which is expected to expand to 12% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For frontdoor, I've compiled three fundamental factors you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is frontdoor worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether frontdoor is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of frontdoor? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
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. |
Factbox: International airlines' response to FAA on Iran airspace
(Reuters) - The U.S. Federal Aviation Administration (FAA) issued an emergency order on Thursday prohibiting U.S. air carriers from flying in Iran-controlled airspace over the Strait of Hormuz and Gulf of Oman due to heightened tensions.
Some international airlines are taking precautions following the FAA order.
Here are some statements from non-U.S Airlines:
* Emirates Airline is re-routing all flights away from areas of possible conflict in the Gulf, a spokeswoman said on Friday.
* Emirates’ sister carrier flydubai said it has adjusted some of the existing flight paths in the region and will make further changes when necessary.
* British Airways says it will adhere to FAA guidance, avoiding Iranian airspace. It says flights will continue to operate using alternative routes.
* Netherlands flag carrier KLM was no longer flying over the Strait of Hormuz, a spokesman said on Friday.
* Australia's Qantas said on Friday that it was adjusting flight paths over the Middle East to avoid the Strait of Hormuz and Gulf of Oman until further notice.
* French flag-carrier Air France said it did not fly over the Strait of Hormuz and that it was in constant contact with the French and European civil aviation authorities to analyse any potential risks.
* A Norwegian Air spokesman said the carrier had no departures planned to fly over Iran on Friday "but we are monitoring the situation closely and will reroute if necessary".
* Sweden's SAS: A spokesman for the airline said it was following the situation closely although it did not fly in that territory.
* Singapore Airlines will take slightly longer routes to avoid the affected Strait of Hormuz area due to the ongoing tension, a spokesman said on Friday.
* Etihad Airways said on Friday that contingency plans were in place, and that it would decide what further action was required after carefully evaluating the FAA directive to the U.S. carriers.
* German carrier Lufthansa says it has stopped flying over parts of Iran, but was still serving flights to Tehran.
* Malaysia Airlines says it has avoided the airspace over the Strait of Hormuz on its flights to and from London, Jeddah and Medina.
(Compiled by Tommy Lund and Jagoda Darlak; editing by Emelia Sithole-Matarise) |
What Should You Know About frontdoor, inc.'s (NASDAQ:FTDR) Growth?
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Based on frontdoor, inc.'s (NASDAQ:FTDR) earnings update in March 2019, analysts seem fairly confident, with earnings expected to grow by 5.7% in the upcoming year relative to the past 5-year average growth rate of 3.5%. With trailing-twelve-month net income at current levels of US$125m, we should see this rise to US$132m in 2020. Below is a brief commentary around frontdoor's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those interested in more of an analysis of the company, you canresearch its fundamentals here.
Check out our latest analysis for frontdoor
The 11 analysts covering FTDR view its longer term outlook with a positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
This results in an annual growth rate of 17% based on the most recent earnings level of US$125m to the final forecast of US$196m by 2022. EPS reaches $2.25 in the final year of forecast compared to the current $1.48 EPS today. In 2022, FTDR's profit margin will have expanded from 9.9% to 12%.
Future outlook is only one aspect when you're building an investment case for a stock. For frontdoor, I've put together three essential aspects you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is frontdoor worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether frontdoor is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of frontdoor? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
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 is induced lactation, the process that allows this same-sex couple to both breastfeed even though only one gave birth?
Images of Jaclyn and Kelly Pfeiffer breastfeeding their twins together are going viral [Photo: Benzel Photography /Caters] Powerful images of same-sex parents both breastfeeding their newborn twins is melting the Internet. In one of the photos, new mums Jaclyn, 34 and Kelly Pfeiffer, 37 are holding hands and gazing at each other lovingly as they each breastfeed one of their twins. And the back story behind the image is equally as special as the picture itself. After meeting in 2012 through mutual friends, Jaclyn and Kelly started trying to conceive children of their own back in 2016. But their path to parenthood was much more difficult than they anticipated. Commenting on their journey Kelly, a nurse, said: “In December of 2015, we did a news story about same sex couples both being on their child’s birth certificates and it made us realise how much we wanted children together. “We started trying to conceive shortly after that in January of 2016. But it turned out to be much more challenging than we expected. “We thought it was going to be easy. We initially wanted Jaci to carry, but after many failed cycles, and a diagnosis of polycystic ovarian syndrome [PCOS] and polyps, we decided I would try.” READ MORE: Stacey Solomon gets real about breastfeeding struggle and 'Pepperami nipples' The couple's journey to parenthood wasn't easy [Photo: Benzel Photography /Caters] Fast forward two years, nine months, $21,000 (approx £16,500) and 377 injections, and the couple finally found themselves pregnant with miracle twins - one from each of their embryos. "To conceive our twins, it took: two years and nine months, five intrauterine inseminations at home, two intrauterine inseminations in the doctor's office, one hysterosalpingogram, two saline sonograms, two polyp removals, 15 fresh inseminations, four IVF consultations, 18 monitoring appointments, four egg retrievals, two fresh embryo transfers, three frozen embryo transfers, one cancelled cycle, 58 eggs retrieved, 25 embryos pre-implantation genetic screening tested [PGS], 17 embryos PGS normal, one chemical pregnancy, 377 injections, countless negative pregnancy tests and one emergency c-section,” Kelly continues. “We both wanted a baby bad enough that giving up wasn’t an option. “There were times when it felt like we would never hold a baby, but looking back, they were worth every single shot and every failed cycle and we wouldn’t change a thing.” Story continues Kelly gave birth to twins, Jackson and Ella, back in May [Photo: Benzel Photography /Caters] Since welcoming their miracle babies, Jackson and Ella, who were born in May, the couple have been celebrating every aspect of motherhood, including feeding, and decided to share images, taken by photographer, Melissa Benzel , of the two of them breastfeeding their twins in unison. Kelly said: "Since they have arrived, it has been both amazing and exhausting. "We’re still trying to get into a routine, but I can’t think of a better reason to be exhausted - we’re absolutely in love. "Being able to breastfeed our children together is so surreal and we love it. "We had no idea what our options were for having a baby when we first started out. "And we had never even heard of induced lactation, which is the process that enables Jaclyn to be able to breastfeed our twins.” READ MORE: Mum left 'angry and embarrassed' after being told to stop breastfeeding her baby on Ryanair flight Both Kelly and Jaclyn are breastfeeding the twins [Photo: Benzel Photography /Caters] What is induced lactation? According to experts, it is possible for some women to breastfeed even if they haven’t been pregnant and it’s all thanks to a process known as induced lactation. “With preparation and dedication breastfeeding without pregnancy can be possible, although it may prove to be quite a challenge,” explains Liz Halliday, Deputy Head of Midwifery at Private Midwives . Although it isn’t the case for Jaclyn and Kelly, Liz says the process can be helped if a woman has already carried a baby. “One thing that can make a difference, is whether the mother has previously given birth,” Liz continues. “If so, her body will be familiar with the process of producing milk – this will make reproducing milk for a baby she has not given birth to a lot easier, in comparison to a woman who hasn’t previously delivered her own children.” According to Liz, the natural production of breast milk (lactation) is triggered by a complex interaction between three hormones — oestrogen, progesterone and human placental lactogen — during the final months of pregnancy. “At the times of delivery, levels of oestrogen and progesterone fall, which allow the hormone prolactin to increase and initiate milk production,” Liz explains. In some cases medication can be prescribed to women to help stimulate this change in hormones. But it is possible for some women to breastfeed without medical intervention. “Additionally, creating a pumping schedule will encourage the production and release of prolactin – to maintain this, breastfeeding should be upheld for 15-20 minutes daily every day until the baby arrives.” “However, it is always recommended that women to consult their doctor and a lactation consultant before preparing for induced lactation,” she adds. Now Kelly wants other same-sex couples to know that they’re not alone in their journeys to parenthood. "We want other couples to know what their options are, and that they’re not alone in this process,” she says. “I can’t even describe how I felt when I first saw them. I couldn’t stop crying and instantly just felt so much love for them. I knew all of our struggles were worth it.” |
Oil prices rise; U.S. reportedly called off Iran strikes: Morning Brief
Friday, June 21, 2019
Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET.Subscribe
Investors will get a pulse on the U.S. housing market ahead of the market open when existing-home sales data for May is released. Economists polled by Bloomberg expect existing-home sales to have risen to a seasonally-adjusted 5.30 million units, up from the 5.19 million units sold in April.
Meanwhile, CarMax (KMX) will be the only major S&P 500 (^GSPC) company to report earnings ahead of the market open.
Read more
Oil rises on U.S.-Iran tensions: 'Iran made a very big mistake!': The price of oil is rising on Friday as tensions continue to escalate between the U.S. and Iran. U.S. president, Donald Trump, ordered military strikes on Iran before changing his mind, according to the New York Times. It follows the downing of a US drone by Iranian forces on Thursday.[Yahoo Finance UK]
British Airways among airlines avoiding Iranian airspace over shootdown: British Airways, Dutch airline KLM, Australia’s Quantas Airways, Singapore Airlines, and Malaysia Airlines are among several carriers that have said they will avoid Iranian-controlled airspace following the shooting down of a US drone. On Thursday, the U.S. Federal Aviation Administration (FAA) issued an emergency order, banning U.S.-registered planes from flying in large swathes of the Strait of Hormuz and the Gulf of Oman. [Yahoo Finance UK]
Slack had the third largest initial trade in the US:Slack’s (WORK) direct listing landed in the ranks of some of the top-performing public debuts on record, by at least one measure. The opening trade size for shares of the workplace messaging software company totaled $1.75 billion as investors began snapping up the stock Thursday afternoon. The figure reflects the dollar value of shares trading hands at the stock’s opening price of $38.50, at an opening volume of 45.5 million shares. [Yahoo Finance]
Also:Slack's direct listing shows how much we’re obsessed with work[Yahoo Finance]
Canopy Growth reports more than four-fold rise in Q4 revenue: Canadian pot producer Canopy Growth Corp. (CGC) reported a more than four-fold jump in quarterly revenue on Thursday, benefiting from higher sales following Canada's legalization of recreational cannabis. [Reuters]
Former FDIC chair: Trump 'should let Jay Powell do his job and he should do his'
Amazon is a political punching bag for everyone, from Trump to AOC
Discount retailer Grocery Outlet shares rise in public debut
Adopted AOC amendment will move $5 million from DEA to opioid abuse treatment
Senators want to roll back tax cuts to create jobs for long-term unemployed
Zion Williamson could sign with a Chinese shoe company
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Volatility 101: Should Azarga Uranium (TSE:AZZ) Shares Have Dropped 23%?
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Many investors define successful investing as beating the market average over the long term. But if you try your hand at stock picking, your risk returning less than the market. We regret to report that long termAzarga Uranium Corp.(TSE:AZZ) shareholders have had that experience, with the share price dropping 23% in three years, versus a market return of about 23%. The good news is that the stock is up 6.7% in the last week.
View our latest analysis for Azarga Uranium
With zero revenue generated over twelve months, we don't think that Azarga Uranium has proved its business plan yet. You have to wonder why venture capitalists aren't funding it. So it seems that the investors focused more on what could be, than paying attention to the current revenues (or lack thereof). It seems likely some shareholders believe that Azarga Uranium will discover or develop fossil fuel before too long.
Companies that lack both meaningful revenue and profits are usually considered high risk. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized).
Our data indicates that Azarga Uranium had US$4,273,501 more in total liabilities than it had cash, when it last reported in March 2019. That puts it in the highest risk category, according to our analysis. But since the share price has dived -8.2% per year, over 3 years, it looks like some investors think it's time to abandon ship, so to speak. You can click on the image below to see (in greater detail) how Azarga Uranium's cash levels have changed over time.
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Would it bother you if insiders were selling the stock? I would feel more nervous about the company if that were so. It only takes a moment for you tocheck whether we have identified any insider sales recently.
Azarga Uranium shareholders are down 7.7% for the year, but the broader market is up 1.6%. Of course the long term matters more than the short term, and even great stocks will sometimes have a poor year. Unfortunately, the longer term story isn't pretty, with investment losses running at 8.2% per year over three years. We'd need clear signs of growth in the underlying business before we could muster much enthusiasm for this one. Most investors take the time to check the data on insider transactions. You canclick here to see if insiders have been buying or selling.
But note:Azarga Uranium may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA 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. |
Who will choose the next UK leader? Mostly older white men
LONDON (AP) There's an election underway to choose Britain's next prime minister, but only one in 400 people gets a vote. And most of those are well-off older white men. The country's next leader will be chosen by about 160,000 members of the governing Conservative Party in a runoff between two candidates: former Foreign Secretary Boris Johnson and current Foreign Secretary Jeremy Hunt . They were winnowed down from a field of 10 contenders in a series of votes by Conservative party lawmakers. The Conservatives are choosing a new leader who will also become the next prime minister at a perilous political time. The U.K. Parliament is deadlocked, Britain's departure from the EU has been delayed until Oct. 31 and the new leader will help determine whether the country leaves the bloc in an orderly fashion, crashes out in economic chaos or remains in limbo. It's a huge choice and it's being made by a group that is not representative of British voters as a whole. According to a major U.K. academic study , 70% of Conservative members are men, half are over 55, 86% are middle class or above and 97% are white in a country where 10%-15% of the population belongs to an ethnic minority. And most of them really, really want Britain to leave the European Union, whatever the consequences. "They are very, very euroskeptic," said political scientist Tim Bale of Queen Mary University of London, who helped lead the research. "They are going to pick someone who is strongly identified not just with Brexit, but with a no-deal Brexit." While Britain as a whole is split down the middle over whether to leave the EU, most Conservatives support it and their definition of Brexit has hardened. During the 2016 Brexit referendum campaign, some leaders of the "leave" campaign spoke of remaining in the EU single market like Norway and keeping close economic ties to the bloc. Now, most Brexiteers want a clean break, and refuse to contemplate remaining in a single market with the EU. Story continues In Bale's research, two-thirds of Conservatives said leaving the EU without a divorce deal would be better than remaining bound to EU trade rules. They shrug off warnings from economists that a no-deal Brexit would severely disrupt trade between Britain and the EU, plunging the country into recession. "It's a problem in that the most zealous people of all get to make the choice" of the country's next leader, Bale said. That has left many non-Conservatives watching the race with impotent frustration. Green party lawmaker Caroline Lucas called the contest "one of the most undemocratic elections this country has seen for years." But there is nothing unusual about the process. In Britain's Parliamentary system, voters elect members of Parliament for their local area, constituencies. The party with the most lawmakers forms a government, with the leader of that party becoming prime minister. Parties are entitled to change leaders without going back to the voting public. It happened when Gordon Brown replaced Tony Blair as Labour prime minister in 2007, and when Theresa May took over from her Conservative predecessor David Cameron in 2016. May is now stepping down after her Brexit divorce deal was rejected by Parliament three times. Conservative contests used to be even less democratic than they are now. For decades, Tory leaders were chosen by party lawmakers without a vote. In the 1960s a ballot of legislators was introduced, and these days anyone who has paid the annual fee of 25 pounds ($31) and has been a party member for at least three months gets a vote. For most, the overriding issue in their choice is Brexit. Most Conservatives consider Britain's EU exit a life-or-death issue for the party that has governed Britain for more than half of the last 100 years. Party morale is at rock bottom after disastrous local and European Parliament election results last month that saw many Conservative voters defect to the newly formed Brexit Party led by Nigel Farage, who accuses May's government of betraying the 17.4 million people who voted to leave the EU. Giles McNeill, the Conservative leader of a local council in eastern England, says if Brexit doesn't happen by Oct. 31, "that's it for the Conservatives, and the Brexit Party will just take our space." "I couldn't see the British people forgiving us very quickly for that sort of betrayal," he said. The Brexit impasse leaves Conservatives in a bind. They need a leader who can defuse the threat from Farage by leaving the EU, but also appeal to floating voters to win the next general election two very different, and possibly contradictory, tasks. Johnson's commanding win in the lawmakers' vote suggests many Tories think the well-known, sometimes bombastic former foreign secretary could be their savior, even if some have concerns about his honesty and reliability. "Johnson has street curb appeal, no doubt about that," said Ed Costelloe, a party member for more than 50 years and chairman of the traditionalist group Grassroots Conservatives. "He could make a fool of himself, but equally I look back to characters like Ronald Reagan," Costelloe said. "Lazy and not particularly intellectual, but he (Reagan) made sure to surround himself with people who knew what they were doing. And he goes down in history as a damned good president." ___ Follow AP's full coverage of Brexit and the Conservative Party leadership race at: https://www.apnews.com/Brexit |
You Might Like Eagle Energy Inc. (TSE:EGL) But Do You Like Its Debt?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Eagle Energy Inc. ( TSE:EGL ) is a small-cap stock with a market capitalization of CA$2.2m. While investors primarily focus on the growth potential and competitive landscape of the small-cap companies, they end up ignoring a key aspect, which could be the biggest threat to its existence: its financial health. Why is it important? Since EGL is loss-making right now, it’s crucial to evaluate the current state of its operations and pathway to profitability. The following basic checks can help you get a picture of the company's balance sheet strength. However, this is not a comprehensive overview, so I suggest you dig deeper yourself into EGL here . Does EGL Produce Much Cash Relative To Its Debt? EGL's debt level has been constant at around CA$44m over the previous year made up of predominantly near term debt. At this constant level of debt, the current cash and short-term investment levels stands at CA$4.0m , ready to be used for running the business. Moreover, EGL has produced CA$5.9m in operating cash flow over the same time period, leading to an operating cash to total debt ratio of 13%, signalling that EGL’s operating cash is less than its debt. Does EGL’s liquid assets cover its short-term commitments? Looking at EGL’s CA$48m in current liabilities, it appears that the company arguably has a rather low level of current assets relative its obligations, with the current ratio last standing at 0.16x. The current ratio is calculated by dividing current assets by current liabilities. TSX:EGL Historical Debt, June 21st 2019 Is EGL’s debt level acceptable? EGL is a relatively highly levered company with a debt-to-equity of 59%. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. Though, since EGL is presently loss-making, sustainability of its current state of operations becomes a concern. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns. Story continues Next Steps: EGL’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow. But, its lack of liquidity raises questions over current asset management practices for the small-cap. This is only a rough assessment of financial health, and I'm sure EGL has company-specific issues impacting its capital structure decisions. I suggest you continue to research Eagle Energy to get a better picture of the stock by looking at: Historical Performance : What has EGL's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity. Other High-Performing Stocks : Are there other stocks that provide better prospects with proven track records? Explore our free 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 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. |
Natural Gas Price Fundamental Daily Forecast – Nothing in Weather Forecast to Jumpstart Rally
Natural gas price are inching higher shortly before the regular session opening on Friday after falling apart the previous session following a bearish storage report that blew away the estimates. Thursday’s sell-off delivered a crushing blow to the bulls who were hoping a steady report would jumpstart a rally while they waited for the emergence of a heat wave at the end of June/early July.
At 10:05 GMT,August natural gasfutures are trading $2.176, up $0.010 or +0.46%.
Falling spot prices were also a drag on futures prices, but the biggest bearish influence was the huge miss on storage. The weekly government report delivered results that came in at least 10 Bcf higher than most analysts had expected.
The U.S. Energy Information Administration reported Thursday that domestic supplies of natural gas rose by 115 billion cubic feet (Bcf) for the week-ended June 14.
Bloomberg estimated an injection range between 96 Bcf and 113 Bcf, and a median of 105 Bcf. Reuters forecast a range of 96 Bcf to 115 Bcf, with a median of 105 Bcf. Natural Gas Intelligence predicted a build of 105 Bcf.
Last year, the EIA report showed a 95 Bcf injection, while the five-year average injections stands at 84 Bcf.
Total stocks now stand at 2.203 trillion cubic feet (Tcf), up 209 Bcf from a year ago, but 199 Bcf below the five-year average, the government said.
According to NatGasWeather for June 20 to June 26, “Several weak weather systems continue to produce showers and thunderstorms across the country, focused over the most comfortable across the northern and interior US with highs of 70s and 80s. It remains hot around the periphery with highs of 90s to 100s across California and the Southwest. 80s to 90s across Texas, the South, Southeast, and up the Mid-Atlantic Coast. The weekend will bring cooling across the Northwest & Rockies, while next week will bring increasing heat across the southern 2/3 of the US with 90s and 100s. Overall, demand will be increasing to moderate this weekend and next week.”
The pattern of consolidation then weakness is likely to continue over the near-term until there is a forecast calling for a lingering heat dome. Periodic bouts of scattered pockets of hot temperatures will not be enough to trigger a lasting rally. Oversold technical conditions could produce a short-covering rally, but this type of move is only expected to set-up fresh shorting opportunities.
Thisarticlewas originally posted on FX Empire
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A Look At The Fair Value Of Eldorado Resorts, Inc. (NASDAQ:ERI)
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Today we will run through one way of estimating the intrinsic value of Eldorado Resorts, Inc. (NASDAQ:ERI) by taking the foreast future cash flows of the company and discounting them back to today's value. This is done using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model.
Check out our latest analysis for Eldorado Resorts
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF ($, Millions)", "2019": "$310.18", "2020": "$326.99", "2021": "$344.30", "2022": "$417.00", "2023": "$448.61", "2024": "$476.08", "2025": "$500.39", "2026": "$522.38", "2027": "$542.72", "2028": "$561.96"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x5", "2020": "Analyst x7", "2021": "Analyst x3", "2022": "Analyst x1", "2023": "Est @ 7.58%", "2024": "Est @ 6.12%", "2025": "Est @ 5.11%", "2026": "Est @ 4.39%", "2027": "Est @ 3.89%", "2028": "Est @ 3.55%"}, {"": "Present Value ($, Millions) Discounted @ 11.29%", "2019": "$278.71", "2020": "$264.00", "2021": "$249.78", "2022": "$271.83", "2023": "$262.77", "2024": "$250.57", "2025": "$236.65", "2026": "$221.98", "2027": "$207.23", "2028": "$192.80"}]
Present Value of 10-year Cash Flow (PVCF)= $2.44b
"Est" = FCF growth rate estimated by Simply Wall St
The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (2.7%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 11.3%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$562m × (1 + 2.7%) ÷ (11.3% – 2.7%) = US$6.7b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$6.7b ÷ ( 1 + 11.3%)10= $2.31b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $4.75b. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of $61.31. Relative to the current share price of $52.72, the company appears about fair value at a 14% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Eldorado Resorts as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 11.3%, which is based on a levered beta of 1.436. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Although the valuation of a company is important, it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Eldorado Resorts, I've put together three important factors you should look at:
1. Financial Health: Does ERI have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does ERI's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of ERI? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NASDAQ every day. If you want to find the calculation for other stocks justsearch 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. |
3 Stocks to Build Your Portfolio Around
Building a winning portfolio of stocks is no simple task. That's why having a solid core group of businesses, preferably with a history of returning value to shareholders, is a smart move. If you're looking for some intriguing ideas to build your portfolio around, three Motley Fool contributors suggest taking a look atStarbucks(NASDAQ: SBUX),Walt Disney(NYSE: DIS), andMastercard(NYSE: MA).
Jeremy Bowman(Starbucks):Building a global restaurant empire isn't easy. The industry is highly competitive and often localized, but Starbucks has found the magic touch in the coffee sector. The java giant has built an unmatched brand, starting with former longtime CEO Howard Schultz's foundational vision to bring the Italian coffee experience to the U.S.
From there, Starbucks has expanded around the world thanks to its ability to stay ahead of trends -- not just in products, with popular items like the pumpkin spice latte, but also in tech, as the company was one of the first restaurant chains to adopt digital payments and mobile ordering.
Image source: Getty Images.
Those efforts have helped Starbucks establish an enviable loyalty program, with 16.8 million members in the U.S. as of its most recent quarter, up 13% from the year before.
Mobile order and pickup enabled by its app, as well as delivery, should allow the company to expand its business, add new stores as warranted, and extract more revenue from existing stores.
In China, where the company is adding 500 stores a year, it also has a tremendous opportunity for growth. Though it faces a new challenge fromLuckinCoffee(NASDAQ: LK), a Chinese start-up, even Luckin argues that much of its opportunity rests on the premise that theChinese demand for coffee, which on a per-capita basis is only a fraction of what it is in the U.S., will exponentially grow as more Chinese enter the middle class and move to cities. If that happens, Starbucks will certainly be a big winner as well.
The coffee giant also offers a 1.9% dividend yield, and it shouldraise that payoutonce again in the coming weeks, possibly by 20%, as it's done in recent years. With a commitment to returning capital to shareholders and ample growth opportunities, Starbucks offers the rare combination of growth and income that makes it a great long-term stock for almost any portfolio.
Daniel Miller(Walt Disney):When identifying what companies will make the core of your portfolio, you'll want businesses that check multiple boxes. Disney will check just about every box an investor could want: a powerful brand, a long list of original content and popular movie franchises, legendary theme parks, and a history of returning value to shareholders via dividends, among many other virtues.
DISdata byYCharts.
And while Disney continues to trade around all-time highs, don't let that scare you off; the company is well positioned to thrive in the decades ahead. It already boasts Marvel and Lucasfilm movies that includeAvengersandStar Warsfilms. And now with its acquisition of Twenty-First Century Fox, it adds thousands of hours of television to its name. Disney's movies, media networks, and television content let it tackle growth opportunities with streaming services, including Disney+ later this year. Management's goal is to rope in as many as90 million subscribers by the end of fiscal 2024, which would be quite impressive.
But wait, there's more: One factor many investors miss is Disney's global opportunity. Take India, an emerging market where household income is increasing and opening the door for roughly 1 billion video screens by 2023, according to Disney. That sheer number of screens is a massive opportunity, one of many outside the United States that could fuel top-line growth. Ultimately, Disney checks just about every box an investor could want -- a perfect stock to build your portfolio around.
Brian Feroldi(Mastercard):I'm a big believer that the whole world will eventually go cashless. I rarely use cash in my own life and firmly believe thatbillionsof others will move in the same direction in time.
What's the best way for investors to benefit from this trend? My favorite answer is to become a shareholder of Mastercard.
It owns and operates one of the largest payment networks in the world. The company doesn't actually make loans to consumers or businesses. Instead, it acts as a key middleman to facilitate transactions between banks, merchants, and consumers. The company earns a small fee for ensuring that each transaction happens quickly and securely.
With trillions of dollars flowing through its network annually --yes, trillions-- those small fees translate into billions of dollars in high-margin revenue. When adding in the magic ofoperating leverageand consistent stock buybacks, Mastercard's earnings per share have consistently grown at a much faster rate than revenue.
MA Revenue (TTM)data byYCharts.
I see no reason this trend can't continue. Wall Street appears to agree. The current consensus estimate is that Mastercard's earnings will grow in excess of 18% annually over the next five years. That's extremely impressive for such a mature business, which is why this is a great growth stock to build your portfolio around.
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Brian Feroldiowns shares of Mastercard, Starbucks, and Walt Disney.Daniel Millerhas no position in any of the stocks mentioned.Jeremy Bowmanowns shares of Starbucks and Walt Disney. The Motley Fool owns shares of and recommends Mastercard, Starbucks, and Walt Disney. The Motley Fool has adisclosure policy. |
NEM Launches Development Studio Ahead of Major Blockchain Upgrade
The NEM blockchain project is launching a development studio to support its move towards a major protocol upgrade later in 2019.
According to a press release emailed to CoinDesk, the new NEM Studios is being created by NEM Holdings, the non-profit holding company of NEM Ventures, and the NEM Foundation to help with strategy and backend development for NEM’s planned “Catapult” protocol upgrade.
Catapult is aimed to provide enterprises with a “high speed, configurable and scalable blockchain solution,” the release states.
Related:New Research Targets a Big Worry for Some Blockchains: Double-Spent Transactions
NEM Studios’ development activities are to be funded by NEM Core, and is now seeking to hire a CTO and a development team to assist with building the Catapult Core protocol and API layer. Chair and trustee of NEM Holdings and chair of the investment committee for NEM Ventures David Shaw – whoalso advisesthe Catapult project– will lead NEM Studios as director.
A steering committee comprised of David Shaw, NEM Foundation President Alexandra Tinsman, and Nate D’Amico from NEM’s Project Management Committee will lead the “go-to-market” strategy for the upgrade.
Shaw said:
“We are thrilled to be creating a dedicated team to bring Catapult to life this year and support its development into the future. We will be looking to recruit the best in the business, with deep technology experience, and look forward to creating a more effective and scalable ecosystem for our community.”
Related:NEM Foundation Charts Path Forward After $8 Million Rescue, Major Cutbacks
Catapult is planned to become the core NEM code supporting both private and public blockchains. As per the press release, it will include smart contract plug-ins allowing a range of capabilities such as digital asset creation, decentralized swaps, advanced account systems and business logic modeling.
The news comes soon the NEM Foundation was forced to makemajor staffing cutbacksfollowing a shortfall in its finances. Tinsman confirmed in March that the foundation had laid off about 100 people – a mix of consultants and full-time staffers – over a period of a month.
The project was also forced to request that around $8 million of NEM reserves be released in stages to support its continued operations.
Tinsman had told CoinDesk in January that the funding issues were down to “the mismanagement of the previous governance council.”
NEM conference booth image courtesy of NEM Foundation
• NEM Foundation, Nearly Broke, Plans Layoffs and Pivot
• NEM Price Climbs to 9-Week High As Coincheck Brings Back Trading |
A Bang Up Week for Ripple: CEO Daily
Good Friday morning.
Facebookmay have gottenall the attentionthis week, but it’s also been a bang up week for Ripple, which uses cryptocurrency to facilitate real time transactions, working with financial institutions. On Monday, Ripple announced it was investing some $50 million in MoneyGram, which will use Ripple’s XRP product to speed up and simplify cross-border payments. MoneyGram stock soared 150% after the announcement.
Ripple CEO Brad Garlinghouse told those attendingFortune’s Brainstorm Finance in Montauk, N.Y., that the Facebook announcement had been a “call to action” for other institutions considering cryptocurrency projects. “I’m thinking of sending a case of champagne to David Marcus,” who runs the Facebook-led Libra project,he said. “It’s going to be a record week for Ripple.”
The very term cryptocurrency conjures up images of shady transactions by criminals seeking anonymity. “There is a lot of hype and a lot of bullshit in the blockchain space,” Garlinghouse said. But his company’s work with financial institutions avoids anonymity, complies with bank “Know Your Customer” rules, and allows real-time settlements without the need for institutions to hold large cash balances to cover them. Referring to those balances, he said: “If you can reduce the amount of oil in the engine, that creates tremendous efficiencies.”
Also at the event, entrepreneur and Everledger CEO Leanne Kemp told how she is using blockchain technology to track the provenance and movement of diamonds. And 17-year old Ananya Chadha—who won the CryptoChicks Hacking Award in Toronto last year—wowed the groupwith her animated descriptionof how blockchain plus genetics plus nanotechnology plus brain-computer interface is going to create “the craziest things” in the future.
CitigroupCEO Michael Corbat closed out the day. Asked if he would consider joining Facebook’s Libra alliance, Corbat replied: “We’d take a look at it.”
More from Day 2 ofFortuneBrainstorm Financehere; other news below.
Alan Murray@alansmurrayalan.murray@fortune.com
1. Top NewsIran ThreatThe U.S. came very close to carrying out strikes on Iranian targets overnight, with President Trump having given his approval. Planes were in the air and ships in position, and Trumpreportedlyeven went so far as to warn Iran (via Oman) of the imminent strikes—but then he changed his mind at the last minute. Why? Right now, that’s not clear.New York TimesS&P RecordThe S&P 500 hit a new closing record of 2,954.18 yesterday, as Wall Street reckons the Fed will cut interest rates next month. The index also hit a new intra-day record, at one point reaching 2,958.06. Big winners included Oracle (over 8%) and General Electric (almost 3%).Washington PostSlack SharesSlack had a killer first day of trading, with its shares closing at $38.62, which is 48% higher than the reference price set by the NYSE. It wasa direct listing, so the price was set by the stock exchange rather than banks and Slack itself.Wall Street JournalHuawei StrategyHuawei’s fightback against U.S. pressure could involve demanding more royalties from American firms that use its intellectual property, according to experts speaking to CNBC. Huawei has valuable patents in core telecommunications network technology and Internet-of-things tech, and it’s already recently been chasing Verizon for $1 billion in royalties.CNBC
2. Around the Water CoolerBernie’s Ownership IdeaThe socialist Democratic candidate Bernie Sanders wants to force companies to give greater ownership of the business to their employees. Setting aside the question of compulsion, the idea actually has a great deal of precedent, particularly in the U.K. Here’s a rundown of how and why the employee-ownership trend is growing there, and what it means for businesses.FortuneBrexit ChampionThe race for the leadership of the British Conservative Party—and thereby the country—is now down to two individuals: former foreign secretary Boris Johnson, who is a hard Brexiteer and the most likely victor, and current foreign secretary Jeremy Hunt, who is a slightly more moderate figure. The whittling was done by Tory lawmakers, and now it’s up to the party membership to choose the winner. In a month’s time. Because it’s not like the country is undergoing any sort of urgent crisis or anything.BBCEU DecisionsYesterday was a bad day for decision-making in the EU. The member states failed to agree on who the new European Commission president should be—the EU is trying out a system whereby each political grouping in the European Parliament nominates a lead candidate, but itdoesn’t seem to be going well. Perhaps more seriously, member states also failed to agree a plan to go carbon-neutral by 2050, thanks to the obstinacy of Poland, Czechia, and Hungary.France24A.I. LandlordsFortune‘s Shawn Tully has a fascinating piece on how real estate investment giant Amherst is using computer models to spot newly listed homes in the right kind of suburbs, figure out how much renovation might cost, and come up with a likely rent to charge.FortuneThis edition of CEO Daily was edited by David Meyer. Findprevious editions here, andsign up for other Fortune newsletters here. |
European central bankers claim oversight over Facebook’s cryptocurrency
By Francesco Canepa
FRANKFURT (Reuters) - Three European central bankers are claiming oversight over Facebook's planned virtual currency to ensure it will not jeopardize the financial system or be used to launder money.
Facebook drew worldwide interest this week when it announced plans to introduce a cryptocurrency called Libra, part of an effort to expand into digital payments.
Facebook said Libra would be backed by real-world assets, including bank deposits and short-term government securities, to make it more stable -- and thus practical for payments and money transfers -- than other cryptocurrencies such as bitcoin.
With the potential to reach billions of internet users and the backing of payment giants like Visa, Facebook hopes Libra will not only power transactions but offer people without bank accounts access to financial services for the first time.
But the central bankers of Britain, France and Germany said Facebook should expect scrutiny.
"It has to be safe, or it's not going to happen," Bank of England Governor Mark Carney told the BBC in an interview broadcast on Friday.
"We, the Fed, all the major global central banks and supervisors, would have direct regulatory (oversight)," he said, referring to the U.S. Federal Reserve.
Global central bankers have so far largely refrained from regulating digital currencies, having failed last year to reach an agreement on how to do so and concluding they were too small to pose a risk to the financial system.
Other global regulators have been monitoring the growth of cryptocurrencies. The Financial Action Task Force, a Paris-based global anti-money-laundering watchdog, is expected to announce rules to address the use of digital coins for illegal purposes.
But Libra's announcement has put the issue back on their radar, with the focus now shifting from bitcoin to so-called stablecoins, such as Facebook's Libra, that are backed by real-world assets.
France said on Friday it would create a task force on the matter as part of its presidency of the Group of Seven club of the world’s seven largest economies. It will be chaired by European Central Bank board member Benoit Coeure.
"It will in the coming months examine the anti-money laundering requirements, but also those of consumer protection and operational resilience and any issues relating to monetary policy transmission," said France's central bank governor, Villeroy de Galhau.
His German counterpart, Jens Weidmann, warned that stablecoins could undermine banks if they became a widespread alternative to bank deposits in conventional currencies.
"They could undermine the deposit-taking of banks and their business models," Weidmann said on Friday. "This might disrupt transaction banking and financial market intermediation."
One of the issues to be considered by the G7 task force is custodianship, or where and how the official currencies underpinning the tokens would be stored, according to a letter seen by Reuters.
This is a crucial point for stablecoins. Tether, the highest-profile stablecoin, with coins worth around $3.6 billion in existence, has faced questions over whether it holds enough U.S. dollars to back the tokens in circulation. The company has said it has sufficient reserves.
Facebook is grappling with public backlash after a series of scandals ranging from privacy breaches to accusations that it is restricting freedom of speech.
(Reporting by Francesco Canepa; additional reporting by Tom Wilson; editing by John Stonestreet) |
Meet the A.I. Landlord That’s Building a Single-Family-Home Empire
Erin Burrus has endured some misfortune in recent years:After a cancer diagnosis, she lost her home to foreclosure. Today she’s healthy again, and a stable job in sales has helped her mend her finances. “I’m climbing my way back up,” says Burrus. One symbol of her stability is the two-bedroom home she shares with her husband and their children in Greenwood, a solidly middle-class suburb of Indianapolis. The family rents the place rather than owning their home. But it was important to Burrus that they not be in an apartment. “I wanted to get a house with a yard for the kids, for that family atmosphere,” she says.
Burrus’s landlord is a company called Main Street Renewal; she found out about it from her mother, who rents a nearby home from the same outfit (and runs a thriving dress-alteration business with Burrus). And each is now playing a small part in an ambitious experiment.
Main Street Renewal is an arm of Amherst Holdings, a real estate investing firm with $20 billion under management. It owns or manages some 16,000 single-family homes, scattered across the Midwest and the Sunbelt. That portfolio makes Amherst one of the biggest, fastest-growing players in institutionally owned rental homes, a $45 billion subsector of the real estate industry that barely existed before the Great Recession.
Sean Dobson, Amherst’s CEO, is an imposing Texan data savant who dropped out of college to get into mortgage trading. A decade ago, he made a killing shorting shaky debt during the housing crash. Today he’s adding 1,000 homes a month to his empire with the help of artificial intelligence, using data modeling to make dozens of offers a day on potentially profitable houses. The Main Street homes are a $3.2 billion investment that generates around $300 million in annual rental income, but Dobson harbors far bigger ambitions: “We want to get to 1 million homes in the next 15 years or so,” he says. While that figure reflects as much bravado as realism—it’s more than 60 times the number of homes Amherst owns today—the fact that it’s conceivable shows how much the housing market has changed, and how technology is helping investors profit from those changes.
The rise of the single-family-rental industry reflects profound shifts in the finances and attitudes of America’s families. Homeownership, long a bedrock of financial stability, has become unattainable or undesirable for many middle-income workers—for reasons including tighter lending standards, large college-debt loads, and lagging wage growth and savings. According to Yardeni Research, slightly more than one in three households that would have been buying first homes before the financial crisis is now either renting or still living with their parents.
These trends translate into roughly 5 million households that are renting single-family homes rather than taking out mortgages and building equity, and that’s Amherst’s target market. Its specialty is grabbing run-down properties in nice, middle-class subdivisions—guided by algorithms that help it avoid bidding wars and money pits—which it then spruces up for the new rental generation. Amherst’s typical customers are couples in their early forties with one or two kids and household incomes around $60,000. They’re paying an average rent of $1,450 a month. “That’s almost exactly what they’d pay on a mortgage and other expenses if they owned the house,” says Dobson. “We’re catering to a whole new class of Americans—the former buyers who are now either forced renters or renters by choice.” And Dobson is betting that this new class is a permanent one.
Single-family-homerentals have long been dominated by local entrepreneurs—mom-and-pop investors or groups of businesspeople who own and manage no more than a couple of dozen properties (and often as few as one). Historically, when bigger fish, such as hedge funds and real estate investment trusts (REITs), invested in rental housing, they focused on apartment buildings—larger assets whose bunched-together density made them more cost-effective to manage.
The housing crash of the 2000s changed the math. As hard-pressed households gave up on ownership, and demand for rentals increased, investors realized single-family houses could be a more stable income source than apartments. An empty unit is a money loser, and houses were empty less often. Tom Barrack, head of real estate investment firm Colony Capital, explains that in single-family homes, “families stayed for two or three years, versus six months to a year in apartments.” Demand has stayed high, he adds, in part because consumers who used to see homes as investments are no longer confident that prices will rise.
The business remains highly fragmented: Institutional investors own only about 2% of America’s 15 million single-family rental homes. But over the past seven years, those investors have amassed a substantial portfolio—some 300,000 houses in all. The biggest players include Invitation Homes, a REIT that’s the product of a merger of rental divisions of several investment firms, including Blackstone, Starwood Capital, and Colony Capital; American Homes 4 Rent; and Amherst. All these landlords use automated house-hunting to fuel their growth. But Amherst differs from its rivals in focusing its computer models—and its business model—on affordable suburbs in the solid middle of the U.S. housing sector.
Dobson spent his childhood far from those burbs, in a trailer in an East Texas state park where his family owned a campground concession. “My mom and dad rented cabins and sold gas,” recalls Dobson. “Then oil prices spiked, people couldn’t afford vacations, and that was the end of the redneck paradise.”
The family moved to Houston when Sean was starting high school, and his father bought him the toy that would change his life, a TRS-80 computer from Radio Shack. The device generated so much static, Dobson says, that the family’s TV picture dissolved when the computer was running. But he became an expert programmer, and the summer after his high school graduation in 1987, he got an IT job on a mortgage-trading desk. He became a pioneer in building sophisticated models to price home loans—and in using those models to find instances when investors were mispricing mortgage-backed securities (MBSs) based on faulty projections of their risks.
In 1994, Dobson founded the forerunner to Amherst, and by the early 2000s, Amherst was selling $25 billion a year in MBSs to pension funds and insurers. The seeds of his big score were planted during the housing bubble, when his models predicted a disaster in “Alt-A securities,” packages of loans granted to homeowners who had often refinanced multiple times. “The market was predicting a default rate of 5%, and our models showed it would be 30% [even] if home prices didn’t fall at all,” Dobson recalls. He recruited a group of investors that took short positions in Alt-A, reaping a $10 billion profit—10 times the investment, according to Dobson—when home prices tumbled.
Dobson’s front-row seat at the housing collapse helped him recognize the opportunity in rentals. By 2011 he had begun a campaign to persuade investors to finance a new venture—a fund to buy and rent out single-family homes on an industrial scale. Some of his former partners saw the potential. “Single-family rentals are basically a big information game,” says Curtis Arledge, head of Mariner Investment Group. “You collect all kinds of information if you buy at scale. That data gives him a competitive advantage.”
Most were far more skeptical. To bolster his campaign, Dobson had purchased 215 houses in Phoenix and Dallas. “The portfolio wasn’t ideal,” he concedes. “We had graffiti-scarred houses in the inner city and houses in the suburbs six miles from the nearest house [we owned]. Did I mention that at least one dwelling was a former bordello?” Many investors saw the motley collection as epitomizing everything wrong with being a landlord—the deterioration of the properties, the hassles of maintaining a far-flung portfolio. “They said I was nuts, that this was an impossible business that would suffer ‘death by a thousand cuts,’ ” Dobson says.
It took a year of hard selling for Dobson to raise $200 million. But that seed money was enough to prove his concept. His first properties yielded enough profit to persuade investors to finance future rounds. Since 2011, Amherst has raised eight rental-housing funds totaling $5 billion. In most cases, it has partnered with a single big investor—among them, private equity giants like TPG. The funds have produced average annual percentage returns in the mid-teens on their cash stakes, according to investors, including income from rent and price appreciation. (Amherst occasionally sells packages of homes when prices rise sharply, including to other investors.) And those returns are bigger than they would otherwise be, thanks to the firm’s digitally driven bargain hunting.
On a drive through Arlingtonand DeSoto, two Dallas suburbs, Amherst managing director Joe Negri is quick to point out the fixer-uppers. About one house in five qualifies. Negri shows me the classic signs: bedsheets stuffed in the windows, rusting AC units in the side yards. On the inside, he says, we are likely to find glued-down vinyl tiles peeling off the concrete floors.
Finding shabby abodes like these and making them respectable is the load-bearing wall of Amherst’s strategy. Amherst depends on humans to find cities, towns, and neighborhoods where fixer-uppers can become profitable, then relies on automation to pick individual homes. Negri, 31, heads the human team. He spends 150 days a year on the road overseeing Main Street Renewal’s operations from Atlanta to Denver, searching for “sweet spot” neighborhoods that combine affordable rents with a strong middle-income employment base.
Around 70% of Amherst’s 16,000 homes are in Sunbelt cities: Atlanta and Dallas, combined, account for about 5,300; Houston, Charlotte, and Jacksonville are also big markets. Amherst also favors Rust Belt “metros” with a sturdy foundation of jobs, including Indianapolis, Louisville, and St. Louis. These markets are all shaped by forces that keep housing costs in check. In Sunbelt cities, new construction plays that role; in the Rust Belt, relatively modest economic and workforce growth keep housing cheap. Each is an antithesis to coastal markets such as Los Angeles and Boston, where a dearth of new building and superheated local economies inflate prices. Focusing on fixer-uppers in modestly priced markets helps keep Amherst’s all-in costs for each home, including repairs, remarkably low, ranging from an average of $140,000 in Memphis to $208,000 in Dallas. (The median existing-home price nationwide is $267,300.) They’re almost always priced below the average in those markets too.
Making sure low prices aren’t a sign of economic zombiehood is Negri’s job. “The No. 1 criteria is diversity of employment,” he says, especially in blue-collar and middle-class jobs. Before Amherst chooses a new metro, Negri explores its neighborhoods firsthand. “I’ll live in a hotel for a month straight, driving around with an iPad,” he says. “I was driving the Florissant area of St. Louis early in the morning, and one out of every two or three people are dressed inBoeinguniforms. That gave me a lot of confidence.” A dealbreaker: cars sitting in the driveway in mid-morning, a sign that a lot of residents aren’t getting paychecks.
Based on research like Negri’s, Amherst now targets around 1,000 zip codes in 30 metro areas. Choosing homes there is the job of Amherst’s highly automated purchasing system. In its 19th-floor office on New York City’s Madison Avenue, a dozen buying specialists screen leads on their workstations, delivered by a proprietary program called Explorer, an offshoot of the software Dobson developed to price mortgages. Each morning, the team gets alerts on newly listed homes that meet its price range and geographic criteria—around 1,400 listings a day.
For each “first cut” listing, Explorer estimates the costs of renovation. This is machine learning at work: The estimate is based on Amherst’s experience with homes of similar age and size in the same or nearby neighborhoods. In an older home, this might include replacing the HVAC system; for one whose listing photos suggest wear and tear, it might include a new roof. (Team members help the software make that call.) Explorer has become so precise, Negri says, that the actual renovation costs average within 5% of the estimates.
Explorer also runs a separate calculation, finding three homes being rented within a two-mile radius that are close in age, size, and bed-and-bath specs to the newly listed home. Machine learning helps the software estimate what each house would rent for based on these “comps.” Explorer then churns out an estimated “rental yield”—the net rent after such expenses as taxes and maintenance, divided by all-in cost.
If that yield meets Amherst’s target (whichFortuneestimates is between 5% and 6%), the team will make an offer. About 20% of each day’s listings qualify; Amherst bids on those candidates no more than 12 hours after they’re first listed, making all-cash offers. Around 10% of its offers—on roughly 30 homes a day—get accepted and go to contract. Amherst dispatches inspectors to assess each home’s condition during the grace period. Unless they find fatal surprises—such as a cracked foundation—the houses pass muster and join the Main Street Renewal portfolio.
Once you own a fixer-upper,of course, you need to fix ’er up. Amherst spends an average $28,000 per home, roughly 20% of the purchase price, on renovations. Many of the middle-class families in Amherst’s customer base could amass the down payment to buy the same low-priced homes, but few would have the savings to also fund big improvements.
Touring a dozen Main Street Renewal houses in Dallas and Atlanta, I was impressed by how closely the homes, especially the interiors, resembled new construction. The houses all had different floor plans, but within each varied box, Amherst installed the same features: the kinds of fixtures and brands you’d find in a new middle-to-higher-end subdivision. In a six-year-old, 3,100-square-foot home in Douglasville, a suburb of Atlanta, Amherst had installed four gleaming newGEappliances: stove, dishwasher, fridge, and microwave. The countertops were thick quartz; the downstairs floors were sturdy ceramic tile; Hampton Bay ceiling fans whirred in the living room and master bedroom. The rent: $1,850 a month.
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In nearby Austell, a smaller, cheaper, and older Main Street home—1,850 square feet, built in 1997—was undergoing a gut renovation. The carpeting was ripped and stained, and the vinyl ceiling in the kitchen sagged. But workers were installing the same appliances, flooring, and other features as in the Douglasville house. The Austell renovations would eventually cost twice what the Douglasville ones did. But that house would rent for $1,695—enough to reap the yield Amherst seeks.
Economies of scale help these renovations pay off. The improvements that cost Amherst $28,000 would, by the company’s estimates, cost a regular buyer at least $44,000. Because Amherst purchases in such high volumes, it can buy fixtures on heavily discounted national contracts. Its cost for the four GE appliances combined, for example, is $1,850 per home; a do-it-yourselfer would pay around $3,000 atHome Depot. The renovations are handled by outside contractors, but many rely on Amherst for most of their business, so costs are predictable and overruns are rare.
Amherst’s tenants also benefit from a time-honored privilege of renting: not being on the hook for repairs. In-house crews in each market handle most of that. In Dallas and its suburbs, a crew of 28 maintenance workers pilots a fleet of 10 white repair vans, each bearing the Main Street Renewal logo and each stocked with spare tiles, trendy “moth gray” paint, and ceiling fans.
Amherst has figured out howto serve a fast-growing new cohort of renters. The question facing Dobson is whether that cohort will keep growing.
Some experts think the downturn in ownership is temporary and that more millennials and families are on the verge of buying. That might not doom Amherst’s business model, but it would put the brakes on investor enthusiasm, says Ed Pinto, an economist at the American Enterprise Institute and former chief credit officer of mortgage agencyFannie Mae. “That Wall Street money is hot, not patient money,” Pinto says. “They will head for the exits or cut back on acquisitions.”
Dobson acknowledges that a surge in demand could trip up his strategy. If prices spike in the Bargain Belts, Amherst’s acquisition costs would go up. And since single-family rents tend to track home prices, its customers might choose to rent apartments rather than homes. “If home prices outpace income growth, we can’t get the rents to be profitable and grow our portfolios,” he says.
Still, Dobson doesn’t see such threats on the horizon, and he thinks most trends are breaking in his favor. If the economy slows, Amherst could benefit in two ways: Home prices would slacken, creating buying opportunities for investors, and rental demand would rise. Whatever the economy does, he argues, his industry will benefit as it scales up. He’s convinced that the pool of homes available to Amherst will grow by millions, as aging landlords whose kids have no interest in fixing toilets and dunning for rents opt to sell to the big guys. “I have $5 billion to $6 billion from outside investors knocking on the door,” says Dobson. “In the end, we’ll get to 1 million houses.”
However big the empire becomes, it’s unlikely to ever include Dobson’s own home. He and his wife and two kids share a baronial brick manse of more than 7,500 square feet, complete with wine cellar, in trendy Austin. It may not be huge by Texas standards, but it’s the kind of home that would never clear Amherst’s algorithms, in the kind of market Dobson the landlord wouldn’t touch.
A version of this article appears in the July 2019 issue of Fortune with the headline “America’s A.I. Landlord.”
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What Type Of Shareholder Owns Havilah Mining Corporation's (CVE:HMC)?
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A look at the shareholders of Havilah Mining Corporation (CVE:HMC) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'
With a market capitalization of CA$9.0m, Havilah Mining is a small cap stock, so it might not be well known by many institutional investors. In the chart below below, we can see that institutions own shares in the company. Let's delve deeper into each type of owner, to discover more about HMC.
Check out our latest analysis for Havilah Mining
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
Havilah Mining already has institutions on the share registry. Indeed, they own 18% of the company. 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 Havilah Mining's earnings history, below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Havilah Mining. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
I can report that insiders do own shares in Havilah Mining Corporation. In their own names, insiders own CA$677k worth of stock in the CA$9.0m 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, mostly retail investors, hold a substantial 52% stake in HMC, suggesting it is a fairly popular stock. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
We can see that Private Companies own 12%, of the shares on issue. 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.
It appears to us that public companies own 9.4% of HMC. We can't be certain, but this is quite possible this is a strategic stake. The businesses may be similar, or work together.
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow for free.
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. |
What Is the AUMF? The Repeal of This Policy Could Prevent War with Iran
The House of Representatives passed anappropriation bills packageWednesday to fund several federal departments through 2020, but one of the most notable measures has little to do with money: deep within the Department of Defense funding bill is a provision repealing a 2001 law that gives the president widespread authority to instigate military action.
The Authorization for Use of Military Force, passed just a week after the September 11 terrorist attacks, states that the president may “use all necessary and appropriate force” against any nation, organization, or person he determines aided the 9/11 attacks, or “harbored such organizations or persons.”
The U.S. Constitution gives Congress the sole power to declare war, but under the AUMF the president can essentially bypass any required congressional approval. This matter has become of particular concern lately as the Trump administration appears to begearing up for conflictwith Iran.
President Donald Trump pulled the U.S. out of the Iran Nuclear Deal in 2018; although other world powers still remain in the agreement, Iran said Tuesday that it would soonbreak the uranium stockpile limitthe deal set into place. This announcement came just days after Secretary of State Mike Pompeo claimed Iran was responsible forattacks on two oil tankersnear the Persian Gulf and Trump sent an additional 1,500 troops to the Middle East.
Furthermore, the Trump administration said Wednesday thatIran has ties to Al Qaeda, the terrorist organization responsible for the 9/11 attacks. If this is true, the circumstances would allow for Trump to take military action against Iran under the AUMF.
The House’s appropriations bill for the Department of Defense includes a provision that repeals the AUMF, effective eight months after the legislation is passed. The bill’stextstates the repeal applies to operations being carried out under AUMF prior to the date of effectiveness as well.
Moreover, the bill explicitly states “nothing in this Act may be construed as authorizing the use of force against Iran.”
The appropriations bill was able to pass through the Democratic-led House, but is likely to die in the Republican-led Senate. No Republican representatives voted for the bill.
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Hannity Warns Iran: End Hostility Or Trump Will ‘Bomb The Hell Out Of' You
Fox News ’ Sean Hannity on Thursday night urged the leaders of Iran to “end this hostility” with the U.S. or “feel pain, I predict, like never before.” Hannity’s warning came amid a dramatic escalation in tensions between the two countries after Iran shot down an unmanned American spy drone near the country’s coastline Thursday and was blamed by the U.S. for last week’s attacks on two oil tankers. The New York Times reported late Thursday that Trump authorized military strikes against Iran in retaliation , but the mission was later canceled. Hannity, a staunch defender of the president who enjoys a chummy relationship with him, noted Trump said “clearly during the campaign” that he “does not want war” and was “not interested” in “another, you know, years and years long international entanglement.” Hannity hoped Iran’s leaders were “smart enough to take the opportunity” to de-escalate the situation, he added. “Because if they don’t, the president will have no choice. He will bomb the hell out of them. No need for a long, protracted boots-on-the-ground kind of war.” “We have the greatest military, thank God, on the face of this earth,” continued Hannity, whose prime time show is the widely watched conservative cable network’s most popular. “We have the most advanced weapon systems, and a strong message needs to be sent, that a huge price will be paid if you take on the United States of America,” he added. “Simple. Peace through strength, and it works.” Check out the clip here: Related... Donald Trump Jr. Gets Vital History Lesson After Making Ridiculous Claim About His Dad Hillary Clinton Mocks Donald Trump's 2020 Rally Rant With Stamina Gag Ivanka Trump Violated Hatch Act With MAGA Tweets, Watchdog Group Says Also on HuffPost Love HuffPost? Become a founding member of HuffPost Plus today. This article originally appeared on HuffPost . |
Have Insiders Been Buying Warrior Gold Inc. (CVE:WAR) Shares?
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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. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellWarrior Gold Inc.(CVE:WAR), you may well want to know whether insiders have been buying or selling.
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
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. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
Check out our latest analysis for Warrior Gold
In the last twelve months, the biggest single sale by an insider was when the President, Danièle Spethmann, sold CA$75k worth of shares at a price of CA$0.075 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of CA$0.085. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 34.8% of Danièle Spethmann's stake. Notably Danièle Spethmann was also the biggest buyer, having purchased CA$128k worth of shares.
Happily, we note that in the last year insiders paid CA$128k for 1.8m shares. But they sold 1.4m for CA$107k. In total, Warrior Gold insiders bought more than they sold over the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Warrior Gold is not the only stock that insiders are buying. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
There was only a small bit of insider buying, worth CA$5.7k, in the last three months. Overall, we don't think these recent trades are particularly informative, one way or the other.
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. From our data, it seems that Warrior Gold insiders own 10% of the company, worth about CA$513k. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. On a brighter note, the transactions over the last year are encouraging. We'd like to see bigger individual holdings. However, we don't see anything to make us think Warrior Gold insiders are doubting the company. Along with insider transactions, I recommend checking if Warrior Gold is growing revenue. This free chart ofhistoric revenue and earnings should make that easy.
But note:Warrior Gold 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. |
Former Barclays chief executive John Varley acquitted in fraud case
Former Barclays chief executive John Varley was today sensationally acquitted of fraud charges over the bank’s controversial fundraising from Qatari investors in 2008.
Varley, left, one of the highest profile City figures of his generation, had been charged by the Serious Fraud Office with conspiracy to commit fraud by false representation. The SFO claimed he had plotted to pay Qatar secret fees in return for its rescue funding at the height of the financial crisis.
However, judges at the Court of Appeal today ruled there was insufficient evidence to proceed.
There will be retrials in the cases against three other former Barclays executives — Roger Jenkins, then chairman of investment management in the Middle East, ex-wealth management head Tom Kalaris and corporate finance chief Richard Boath.
Judge Robert Jay threw out the case against Varley in April but the Court of Appeal only upheld his ruling today. |
With A 2.5% Return On Equity, Is GCP Applied Technologies Inc. (NYSE:GCP) A Quality Stock?
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. To keep the lesson grounded in practicality, we'll use ROE to better understand GCP Applied Technologies Inc. (NYSE:GCP).
Our data showsGCP Applied Technologies has a return on equity of 2.5%for the last year. That means that for every $1 worth of shareholders' equity, it generated $0.025 in profit.
View our latest analysis for GCP Applied Technologies
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for GCP Applied Technologies:
2.5% = US$12m ÷ US$508m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
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 yearly profit. That means that the higher the ROE, the more profitable the company is. So, all else equal,investors should like a high ROE. 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. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As shown in the graphic below, GCP Applied Technologies has a lower ROE than the average (15%) in the Chemicals industry classification.
Unfortunately, that's sub-optimal. It is better when the ROE is above industry average, but a low one doesn't necessarily mean the business is overpriced. Nonetheless, it might be wise tocheck if insiders have been selling.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first and second cases, the ROE will reflect this use of cash for investment in the business. 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 GCP Applied Technologies does have some debt, with debt to equity of just 0.70, we wouldn't say debt is excessive. Its ROE is rather low, and it does use some debt, albeit not much. That's not great to see. 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 a useful indicator of the ability of a business to generate profits and return them to shareholders. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt.
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. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
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. |
Morgan Stanley Perfectly Sums Up the Dilemma For Tesla Stock Investors
Kudos to Morgan Stanley analyst Adam Jonas for finding the accurate but elegant way of describing the headache investors suffer in trying to figure out what to do withTesla(NASDAQ:TSLA). He explains of handicapping TSLA stock, “We continue to believe Tesla is fundamentally overvalued, but potentially strategically undervalued.”
Source: Shutterstock
What that means (to Jonas) for the shares — and, consequently, the shareholders — from here isn’t a whole lot. That is to say, whatever blend of fundamentals and strategic value Morgan Stanley is using has prompted the firm toset its target price at $230, or or about $10 above the current price. The target is also un-bravely in the middle of a rather well-established trading range.
Nevertheless, the assessment perfectly pegs the sum total of several contradictions that have been vexing Tesla stock investors for years now.
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Jonas, for the record, thinks it’sTesla’s self-driving armthat’s largely underappreciated by Wall Street, and Main Street … a premise that Ark Invest analyst Tasha Keeney agrees with. Sheexplained in a CNBC interviewon Wednesday: “We think the autonomous driving market is going to be a huge opportunity. We think this should be valued at $2 trillion today in the equity markets, and it’s virtually unaccounted for. We think Tesla has a great lead there, and that’s because of the data advantage that they have.”
Keeney specifically namedAlphabet(NASDAQ:GOOGL) andGeneral Motors(NYSE:GM) as names Tesla was besting on the autonomous driving front.
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The analysts’ arguments holdsomewater. But, neither addressed a more philosophical aspect of the matter: What’s Tesla doing with the tech?
The answer is, of course, making its in-house self-driving platform better, but to what end? If consumers don’t want (or can’t afford) a Tesla, a superior self-driving platform is irrelevant. Tesla isn’t doing anything else with the know-how. Alphabet’s Waymo and GM’s Cruise are also at least thebasis of a robo-taxi servicethat doesn’t require consumer sales of vehicles to monetize. Ditto forFord Motor(NYSE:F).
Thus far, Tesla has shown no interest in selling or leasing its self-driving technologies to third parties, while former partnerNvidia(NASDAQ:NVDA) andIntel(NASDAQ:INTC) subsidiary are providing off-the-shelf solutions to carmakers tiptoeing into the arena.
In other words,howis Tesla going to claim its piece of the $2 trillion market Keeney sees on the horizon? If the company intends to continue doing everything by itself and only for itself, the scope of the autonomous driving opportunity means little.
It’s not just a glaring lack of clarity on the self-driving front that keeps current and would-be TSLA stock buyers on edge. Analysts can’t agree on plausible future demand either.
Case in point: Goldman Sachs justcut its price target on TSLA to $158from $200, explaining, “we see a lower probability of the company achieving our upside volume scenarios; we believe a downward path for shares will resume as it becomes more clear that sustainable demand for the company’s current products are below expectations.”
That’s in direct conflict, however, with an assessment that Piper Jaffray posted earlier this month,noting, “We understand why some investors consider the stock un-investable, but of all the reasons to doubt our overweight thesis, we think weak demand is among the least convincing.” Goldman Sachs specifically cited lower tax subsidies as a reason demand was facing a headwind.
Indeed, even with the modest tax credit of $3,750 available until the end of this month, Tesla’s Model 3 haswidened its U.S. sales leadon other EVs despite net cost for these Model 3’s being greater than net sticker prices for alternatives.
Consumers want Teslas, even if they have to pay a little more to get one.
Even analysts themselves are conflicted, not as to how ownership-worthy TSLA stock may be, but whether or not it’s ownership-worthy at all.
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As of the most recent look, the lowest analyst price target sits at $140, while the highest lies at $585. And, of the 31 analysts following the company, 12 are rating it at a “sell” or worse, while another dozen are calling it a “buy” or better.
This is a key part of the reason TSLA shares have been so incredibly volatile. More often than not they’re precariously balanced on the fence, and even the slightest of nudges can knock them off. Sometimes they land on the bearish side of the fence, and sometimes the bullish.
Regardless, Tesla stock’s usually quite quick to climb back on the fence of uncertainty, with the horde on ‘the other side’ screaming their case a little louder when they start to lose ground.
The good news is, the never-ending conundrum has proven helpful to traders even if it’s been agonizing to traders. That is, several trading ranges have taken shape over the years, and now is no exception. While last month’s reversal was seemingly prodded by headlines, a longer-term look at the chart reveals that bottom lines up with a floor around $179 that’s been in seen several times since 2014. If the bulls continue to get traction, the ultimate ceiling is right around $390.
Not surprisingly, the consensus target of around $280 is squarely in the middle of the trading range. The analyst community has collectively hedged its bet on TSLA, underscoring the idea that nobody really knows what to make of this name.
As of this writing, James Brumley held no position in any of the aforementioned securities. You can learn more about James at his site,jamesbrumley.com, orfollow him on Twitter, at @jbrumley.
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The postMorgan Stanley Perfectly Sums Up the Dilemma For Tesla Stock Investorsappeared first onInvestorPlace. |
Should We Be Cautious About GCP Applied Technologies Inc.'s (NYSE:GCP) ROE Of 2.5%?
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to examine GCP Applied Technologies Inc. (NYSE:GCP), by way of a worked example.
GCP Applied Technologies has a ROE of 2.5%, based on the last twelve months. Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.025.
View our latest analysis for GCP Applied Technologies
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for GCP Applied Technologies:
2.5% = US$12m ÷ US$508m (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.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the amount earned after tax over the last twelve months. That means that the higher the ROE, the more profitable the company is. So, all else equal,investors should like a high ROE. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. 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 GCP Applied Technologies has a lower ROE than the average (15%) in the Chemicals industry classification.
Unfortunately, that's sub-optimal. 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. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
Although GCP Applied Technologies does use debt, its debt to equity ratio of 0.70 is still low. Its ROE is quite low, and the company already has some debt, so surely shareholders are hoping for an improvement. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. 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.
But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
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. |
Italy pushing telecoms merger to break broadband logjam: sources
By Elvira Pollina, Stefano Bernabei and Stephen Jewkes
MILAN/ROME (Reuters) - Italy's sovereign wealth fund is maneuvering to pull off a multibillion-euro telecoms merger and end a prolonged corporate stalemate that has held up Rome's plans to create a national broadband network, sources say.
Cassa Depositi e Prestiti (CDP), which has 425 billion euros ($480 billion) in assets, is a major shareholder in two crucial building blocks of any national network, former phone monopoly Telecom Italia (TIM) and its newer rival, Open Fiber.
TIM and Open Fiber, which is owned by CDP and utility Enel, are rolling out rival fiber-optic networks across Italy, raising concerns of duplication and wasted investment at a time when Italy, a digital laggard, needs to catch up fast.
However, squabbling among TIM's major foreign shareholders over broadband strategy has so far thwarted any merger of the two networks, prompting CDP to try and break the impasse, said the sources familiar with CDP's thinking on the matter.
"CDP's plan is to ... call the shots on creating the single network," one source said.
CDP, which is 82.8% state-owned and overseen by the treasury, aims to orchestrate a network merger in a way that would enable it become TIM's biggest shareholder. That would give it the clout to push through change after months of feuding between TIM's current top shareholder, French media group Vivendi, and No. 3 investor, U.S fund Elliott.
CDP already owns just under 10% of TIM and has put itself at "the center of the game" in recent weeks, initiating contacts with TIM executives and Vivendi, the sources said.
That influence is yielding results. On Thursday, TIM said it had signed an agreement with CDP and Enel to start talks on ways of integrating its fiber network with its rival's, including a possible merger.
No final solution has been found, but all options under scrutiny involve merging TIM and Open Fiber network assets in a share-based transaction that would lift CDP's stake in TIM close to or more than Vivendi's 23.9%, the sources said.
That could give CDP a decisive vote over TIM strategy and put it in the strongest position to advance a government plan to rapidly develop a national broadband network.
Enel, CDP, Vivendi and TIM all declined to comment.
WANTED: BROADBAND INVESTORS
Under CDP's main option, TIM would buy the sovereign wealth fund's 50% stake in Open Fiber, using its shares as payment, said the sources familiar with CDP's thinking and a banker with knowledge of the matter.
Enel, also controlled by the state through a 23.6% stake held by the treasury, would sell out of Open Fiber in a separate sale to institutional investors under this scenario, they added.
"The idea is Enel cashes out and its stake offered to long-term investors. It's not Enel's (core) business but of course it all depends on the price," the banker said.
At this point, however, Italian fixed-line broadband would be dominated by TIM and would likely fall foul of competition regulators, so CDP's plan envisages a further, large infusion of private investment to dilute TIM's position, the sources said.
The details have yet to be hammered out, but in the end the assets of both networks could be put under one roof outside TIM, perhaps under Open Fiber itself, with TIM emerging with only a minority stake in it, the sources and banker said.
They said it was too early to speculate on how much private investment would be required to achieve this outcome, but it could run into billions of euros based on network valuations.
Telecoms analysts have made widely varying valuations of the two networks, reflecting different assumptions on future growth.
They value TIM's fixed-line assets, both optic fiber and old copper wire, at 10-15 billion euros ($11-$17 billion) and Open Fiber's exclusively optic fiber network at 2-8 billion euros.
A unified and regulated broadband network could be an attractive proposition for private investors, offering steady and predictable returns.
HIGH DIGITAL STAKES
Enel has right of first refusal over CDP's stake in Open Fiber and can in theory derail CDP's plans by exercising it. In practice, though, Enel will go along with Rome's plan, said another source familiar with the matter.
"(Enel CEO Francesco) Starace has regular meetings with CDP but it's clear he's waiting for TIM first to put its house in order before making any decision," this source said.
The government has the option anyway of replacing Starace early next year when he comes up for reappointment.
Elliott and Vivendi, locked in a year-old battle for board control at TIM, recently met to try to settle their governance differences, one person close to the matter said.
Analysts say that only a neutral network, where TIM would not have an incentive to limit competition from rival services, has the best chance of delivering the content and pricing needed to spur more Italians to go digital.
In 2017, Italy had the lowest internet usage in western Europe alongside Greece, a problem that is holding back the development of a big digital economy deserving of a G7 economy with a population of around 60 million people.
"The number of people in Italy interested in fast broadband services is not that high so a lot depends on pricing. A single network could nudge prices up so the regulator's role is important," says Michele Polo, an expert in antitrust and regulation issues at Milan's Bocconi university.
"The risk of TIM using its dominant position is there," Polo said, but he added strong regulation could deal with this.
Italy's telecoms and broadcaster incumbents have never faced the competition from cable TV that have driven connection speeds up and prices down elsewhere.
Separating fixed-line networks is seen as one of the few ways that legacy telecoms providers can create new value for shareholders. Morgan Stanley analysts described infrastructure as "the most dynamic subsector in telcos" in a note on Friday.
Altice is considering a sale of its Portuguese fiber network, while Denmark's TDC, and O2 in the Czech Republic, have already spun off their networks.
Another Bocconi expert, Carlo Alberto Cardinale Maffè of the SDA Bocconi School of Management, said if the plan was just to re-nationalize TIM and leave it with de facto control of a national broadband network, it would not work.
"I don't think it's in CDP's interest. It would take TIM back 20 years and it would be a failure. Italian and European regulators would never allow that," Maffè said.
(Additional reporting by Gianluca Semeraro in Milan and Gwenaelle Barzic in Paris; Editing by Mark Potter) |
Did You Manage To Avoid Fortune Bay's (CVE:FOR) 11% Share Price Drop?
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Fortune Bay Corp.(CVE:FOR) shareholders will doubtless be very grateful to see the share price up 63% in the last quarter. But that doesn't change the reality of under-performance over the last twelve months. In fact, the price has declined 11% in a year, falling short of the returns you could get by investing in an index fund.
See our latest analysis for Fortune Bay
Fortune Bay 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). We can't help wondering why it's publicly listed so early in its journey. Are venture capitalists not interested? So it seems that the investors focused more on what could be, than paying attention to the current revenues (or lack thereof). For example, investors may be hoping that Fortune Bay finds some valuable resources, before it runs out of money.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. 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.
Fortune Bay had liabilities exceeding cash by CA$501,802 when it last reported in March 2019, according to our data. That makes it extremely high risk, in our view. But with the share price diving 11% in the last year, it's probably fair to say that some shareholders no longer believe the company will succeed. The image below shows how Fortune Bay's balance sheet has changed over time; if you want to see the precise values, simply click on the image.
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Given that situation, would you be concerned if it turned out insiders were relentlessly selling stock? It would bother me, that's for sure. It costs nothing but a moment of your time tosee if we are picking up on any insider selling.
Given that the market gained 1.6% in the last year, Fortune Bay shareholders might be miffed that they lost 11%. 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. Putting aside the last twelve months, it's good to see the share price has rebounded by 63%, in the last ninety days. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). Shareholders might want to examinethis detailed historical graphof past earnings, revenue and cash flow.
But note:Fortune Bay may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA 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. |
New Routes and Cancellations: Airlines Worldwide React to the U.S. Ban on Iranian Airspace
Early Friday morning, the Federal Aviation Administrationbanned all U.S.-registered aircraftfrom flying over Iranian airspace, and airlines worldwide are following the guidance.
The FAA warned of a “potential for miscalculation or misidentification” in the region after an Iranian surface-to-air missileon Thursdaybrought down an unmanned U.S. drone with a wingspan larger than aBoeing737 jetliner.
Iran said the drone “violated” its territorial airspace, while the U.S. called the missile fire “an unprovoked attack” in international airspace over the Strait of Hormuz, the narrow mouth of the Persian Gulf.
There are “heightened military activities and increased political tensions in the region, which present an inadvertent risk to U.S. civil aviation operations and potential for miscalculation or misidentification,” the FAA said.
The Persian Gulf and the Gulf of Oman are crucial areas for international air travel, and many global airlines are following the U.S. safety advice.
Lufthansa, Germany’s largest airline,said ithad been avoiding the Strait of Hormuz and the Gulf of Oman since Thursday, but that it would continue to operate its flights to Tehran.
Dutch carrier KLMalso said itwould avoid the strait, calling the move a “precautionary measure,” according to the Associated Press.
United Airlines said it has suspended its flights between Newark, N.J., and Mumbai, India, which fly through Iranian airspace, following a “thorough safety and security review.”
Australia’sQantassaid it would reroute its flights to and from London to avoid the Strait of Hormuz and Gulf of Oman.
British Airways also said it will reroute flights away from the Strait of Hormuz. The company said Friday that “our safety and security teams are constantly liaising with authorities around the world as part of their comprehensive risk assessment into every route we operate.”
Malaysia Airlinessaid it wasavoiding the airspace, which it normally traversed for its flights between Kuala Lumpur and London, Jeddah, and Medina. “The airline is closely monitoring the situation and is guided by various assessments, including security reports and notices to airmen,” it said.
Singapore Airlines said some of its flights might require longer routings to avoid Iranian-controlled airspace.
The situation could further imperil the bottom lines of Persian Gulf long-haul carriers, which already havefaced challengesunder the Trump administration.
The Gulf is home to some of the world’s top long-haul carriers, which have been battered by Trump’s travel bans targeting a group of predominantly Muslim countries, as well as an earlier ban on laptops in airplane cabins for Middle Eastern carriers. Etihad, the Abu Dhabi-based long-haul carrier, said it had “contingency plans” in place, without elaborating.
“We will decide what further action is required after carefully evaluating the FAA directive to U.S. carriers,” the carrier told The AP.
OPSGROUP, a company that provides guidance to global airlines, wrote Friday: “The threat of a civil aircraft shoot-down in southern Iran is real.”
OPSGROUP said the Iranian weapons system that shot down the drone was comparable to the Russian Buk system used in 2014 Malaysian Airlines shoot-down in Ukraine. Since theMH17disaster, all countries rely on airspace risk advice from the U.S., U.K., France and Germany.
“Any error in that system could cause it to find another target nearby—another reason not to be anywhere near this part of the Straits of Hormuz,” OPSGROUP said. “Bottom line: we should not be flying passenger aircraft anywhere near war zones.”
In response to the drone downing, President Donald Trump initiallytweetedthat “Iran made a very big mistake!” He later appeared to play down the incident, telling reporters in the Oval Office that he had a feeling “a general or somebody” being “loose and stupid” made a mistake in neutralizing the drone.
A U.S. officialsaid the military made preparations Thursday nightfor limited strikes on Iran in retaliation for the downing,but approval was abruptly withdrawn before the attacks were launched,according to the AP.
The drone incident immediatelyheightened the crisisalready gripping the wider region, which is rooted in Trump withdrawing the U.S. a year ago from Iran’s 2015 nuclear deal and imposing crippling new sanctions on Tehran. Recently, Iran quadrupled its production of low-enriched uranium to be on pace to break one of the deal’s terms by next week, while threatening to raise enrichment closer to weapons-grade levels on July 7 if Europe doesn’t offer it a new deal.
Citing unspecified Iranian threats, the U.S. has sent an aircraft carrier to the Middle East and deployed additional troops alongside the tens of thousands already there. All this has raised fears that a miscalculation or further rise in tensions could push the U.S. and Iran into an open conflict, 40 years after Tehran’s Islamic Revolution.
“We do not have any intention for war with any country, but we are fully ready for war,” Revolutionary Guard commander Gen. Hossein Salami said in a televised address Thursday.
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Read This Before Judging Geodrill Limited's (TSE:GEO) ROE
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine Geodrill Limited (TSE:GEO), by way of a worked example.
Over the last twelve monthsGeodrill has recorded a ROE of 1.3%. That means that for every CA$1 worth of shareholders' equity, it generated CA$0.013 in profit.
View our latest analysis for Geodrill
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Geodrill:
1.3% = US$822k ÷ US$63m (Based on the trailing twelve months to March 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, all else equal,investors should like a high ROE. Clearly, then, one can use ROE to compare different companies.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As shown in the graphic below, Geodrill has a lower ROE than the average (8.4%) in the Metals and Mining industry classification.
Unfortunately, that's sub-optimal. 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. Still,shareholders might want to check if insiders have been selling.
Virtually all companies need money to invest in the business, to grow profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. 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.
Geodrill has a debt to equity ratio of 0.10, which is far from excessive. Its ROE is rather low, and it does use some debt, albeit not much. That's not great to see. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt.
But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of courseGeodrill 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. |
Can Geodrill Limited (TSE:GEO) Improve Its Returns?
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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). To keep the lesson grounded in practicality, we'll use ROE to better understand Geodrill Limited (TSE:GEO).
Our data showsGeodrill has a return on equity of 1.3%for the last year. One way to conceptualize this, is that for each CA$1 of shareholders' equity it has, the company made CA$0.013 in profit.
View our latest analysis for Geodrill
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Geodrill:
1.3% = US$822k ÷ US$63m (Based on the trailing twelve months to March 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the amount earned after tax 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 it can be interesting to compare the ROE of different companies.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As shown in the graphic below, Geodrill has a lower ROE than the average (8.4%) in the Metals and Mining 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 could be useful todouble-check if insiders have sold shares recently.
Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the case of the first and second options, the ROE will reflect this use of cash, for growth. 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.
Geodrill has a debt to equity ratio of 0.10, which is far from excessive. Its ROE is certainly on the low side, and since it already uses debt, we're not too excited about the company. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is useful for comparing the quality of different businesses. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have the same ROE, then I would generally prefer the one with less debt.
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 I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of courseGeodrill 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. |
Can Floor & Decor Holdings, Inc.'s (NYSE:FND) ROE Continue To Surpass The Industry Average?
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Floor & Decor Holdings, Inc. (NYSE:FND).
Our data showsFloor & Decor Holdings has a return on equity of 19%for the last year. That means that for every $1 worth of shareholders' equity, it generated $0.19 in profit.
View our latest analysis for Floor & Decor Holdings
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Floor & Decor Holdings:
19% = US$115m ÷ US$620m (Based on the trailing twelve months to March 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all the money paid into the company from shareholders, plus any earnings retained. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. The higher the ROE, the more profit the company is making. So, all else being equal,a high ROE is better than a low one. That means it can be interesting to compare the ROE of different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, Floor & Decor Holdings has a higher ROE than the average (13%) in the Specialty Retail industry.
That is a good sign. In my book, a high ROE almost always warrants a closer look. One data point to check is ifinsiders have bought shares recently.
Most companies need money -- from somewhere -- to grow their 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. That will make the ROE look better than if no debt was used.
Floor & Decor Holdings has a debt to equity ratio of 0.24, which is far from excessive. The fact that it achieved a fairly good ROE with only modest debt suggests the business might be worth putting on your watchlist. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
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 the same ROE, then I would generally prefer the one with less debt.
But when a business is high quality, the market often bids it up to a price that reflects this. 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 check this FREEvisualization of analyst forecasts for the company.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity 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. |
Should You Be Impressed By Floor & Decor Holdings, Inc.'s (NYSE:FND) ROE?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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). We'll use ROE to examine Floor & Decor Holdings, Inc. (NYSE:FND), by way of a worked example.
Our data showsFloor & Decor Holdings has a return on equity of 19%for the last year. One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.19 in profit.
See our latest analysis for Floor & Decor Holdings
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Floor & Decor Holdings:
19% = US$115m ÷ US$620m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is the capital paid in by shareholders, plus any retained earnings. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, Floor & Decor Holdings has a higher ROE than the average (13%) in the Specialty Retail industry.
That's clearly a positive. We think a high ROE, alone, is usually enough to justify further research into a company. One data point to check is ifinsiders have bought shares recently.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. 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.
Floor & Decor Holdings has a debt to equity ratio of 0.24, which is far from excessive. The fact that it achieved a fairly good ROE with only modest debt suggests the business might be worth putting on your watchlist. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. 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.
But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREEvisualization of analyst forecasts for the company.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity 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. |
India steel ministry seeks higher duties to deter Chinese imports -document
* Seeks immediate increase in import duty on finished steel to 15% * Seeks increase in peak import duty on all steel products to 25% * Says U.S.-China trade war threatens India with Chinese imports By Neha Dasgupta NEW DELHI, June 21 (Reuters) - India's steel ministry has sought an immediate increase in import duties on finished steel products to 15% from a range of 7.5% to 12.5%, citing a threat from Chinese imports and excess global capacity, an internal note reviewed by Reuters showed. The steel ministry has proposed the higher duties as part of its recommendations to the finance ministry for the upcoming 2019/20 budget that is due out on July 5. "The U.S.-China trade war is threatening Indian markets as China looks for alternative markets" for its steel exports, India's steel ministry said. Citing the vulnerability of local mills, the ministry said the nation's steel sector needs "protection from unfairly traded cheap steel imports" as well as lower input costs. "Peak rates (for all steel products) may be raised to 25% to meet any contingency arising from potential adverse global market turmoil," it said. Existing anti-dumping and countervailing duties have been rendered ineffective by the volatility in steel prices, the ministry said. The steel ministry said government revenues could increase by 13.66 billion rupees ($196.1 million) if the import duties were implemented, although it is the finance ministry that makes the final decision. The steel and finance ministries did not immediately reply to Reuters emails seeking comment. India turned from net exporter to net importer of steel during the 2018/19 fiscal year as local demand increased and imports jumped from Japan, Korea and China. Japan, South Korea and member countries of the Association of Southeast Asian Nations, which all have free trade agreements on steel with India, accounted for 58% of its imports of the alloy, while 18% of its incoming steel came from China. Story continues Reuters previously reported that India feared Chinese steel flooding its markets as fallout from Beijing's escalating trade war with Washington. Over 50% of India's imports of wire rods and bars - both long steel products used in construction - came from China last year, government data showed. India's top four steelmakers - JSW Steel Ltd, Tata Steel Ltd, state-owned Steel Authority of India Ltd and Jindal Steel and Power Ltd - together control over 45% of India's total steel production. The producers have been complaining about steel being dumped into India for the last several months. India's steel ministry has also sought cuts to import duties on coking coal, steel scrap and graphite electrodes to reduce raw material costs for making steel. ($1 = 69.6650 Indian rupees) (Reporting by Neha Dasgupta; Editing by Gavin Maguire and Tom Hogue) |
Oil in floating storage hit near two-year high in May - Vortexa data
LONDON (Reuters) - Crude and condensate in long-term floating storage hit its highest since August 2017 in May at 24 million barrels, as U.S. sanctions against Venezuela and Iran hindered the ability of the OPEC members to export, data from analytics firm Vortexa showed.
Floating storage rose 15 million barrels in May compared with average levels of May 2018, and levels this month have already reached 26 million barrels, the data showed on Friday.
(Graphic: Crude and condensate in long-term floating storage https://tmsnrt.rs/2FmAel0).
"The rise in long-term storage appears to be driven by the impact of sanctions on Iran and Venezuela, trapping more heavy barrels in offshore storage," Vortexa said.
Oil production in the two countries has fallen sharply since the United States imposed sanctions which have significantly impacted their ability to sell crude.
(Graphic: Oil under santions : https://tmsnrt.rs/2FogeOV)
Iranian crude exports in May were around 400,000 barrels per day according to tanker data and industry sources.
In January-May 2019, oil floating off Venezuela accounted for 23% of global floating storage, rising to 32% in the second quarter so far. This compares with 11% in 2018.
There are currently 13 vessels in long-term storage floating off the Venezuelan coast, Vortexa data shows.
"The trend is even more marked when looking at Venezuela-origin crude additionally held in storage in the Caribbean region," Vortexa said.
Floating storage in the Middle East had a 21% share in the first five months of this year, stable from 2018 levels, though Vortexa said the level of storage in the region could be higher due to unobserved offshore storage activity in Iran.
In Europe there are five tankers holding around 3.5 million barrels of Russian Urals crude that loaded from the Baltic port of Ust-Luga between April 23 and May 5, Vortexa said.
Russia's Druzhba pipeline to Europe and the Ust-Luga port have been contaminated with organic chloride, which can damage refining equipment.
Vortexa considers a vessel to be in long-term floating storage when it is laden and has been stationary for 30 days or longer.
(Reporting by Ahmad Ghaddar; Editing by David Holmes) |
Why The World's 50 Best Restaurants 2019 List Is More Controversial Than Ever
Even now, five years on, René Redzepi’s face still lights up when he recalls the April night his restaurant Noma was named best restaurant in the world for the fourth time. After a difficult 2013, whose nadir came when the Copenhagen restaurant dropped one position on the World’s 50 Best Restaurants list, reclaiming the title the following year felt like redemption. “We had been wondering is this it? Is it the beginning of the end?” Redzepi, 41, said with a smile as he surveyed the crowd at a recent outdoor party in Copenhagen’s meatpacking district. “ So when we won, it was like “Oh, you still like us.” It was even better than the first time.” On June 25, when the 18th edition of the World’s 50 Best Restaurants’ lavish award ceremony takes place in Singapore, he may well get the chance to repeat the sensation. After closing the original Noma in 2016 and re-opening it in 2018 in a new location and with a new menu tied more closely to the seasons, Redzepi and his team are again among the favorites to cinch first place on the prestigious list. But as of this year, no other chefs — at least apart from any who have also rebuilt their restaurants from the ground up — will have the same opportunity. In January, the organizers of World’s 50 Best announced that any restaurant that takes or has previously taken the top spot on the list is disqualified from subsequent editions and moved instead to a Hall of Fame-like collection called The Best of the Best. That includes 2018’s #1, Osteria Francescana, as well as five other revered restaurants. It might seem a small matter, but coupled with other recent changes, the new rule — which came as a shock to many in the restaurant industry — reveals a tremendous amount about the relationship between chefs and an institution that for nearly two decades has played an outsized role in determining which restaurants receive the lion’s share of bookings, accolades, and media attention. And it raises a question that only a few years ago would have been unthinkable: in this age of social media, can any conventional system for evaluating restaurants, including World’s 50 Best, remain relevant? Story continues Italian chef Massimo Bottura talks with the press after receiving the Best Restaurant award for his restaurant L´Osteria Francescana during the World's 50 Best Restaurants awards in Bilbao on June 19, 2018. | Ander Gillenea— AFP/Getty Images Launched in 2002 by editors at the U.K.-based Restaurant magazine, the World’s 50 Best Restaurants ranking quickly became one of the most influential forces in modern gastronomy. A restaurant that earns a spot on the list routinely sees a bump in reservations, and those that make the top 10 can expect a bombardment from eager diners and media alike. “Within 24 hours of the ceremony, we got 2 million booking requests,” says Catalan chef Joan Roca, whose restaurant El Celler de Can Roca, took number one in 2013 and 2015. “We’re still feeling the impact.” Beyond the publicity frenzy, the list also gained influence by tapping into the very human need for approval and belonging. Unlike the Michelin Guide, which is judged by a small group of anonymous inspectors, the 50 Best ranking is today decided by more than a thousand mostly well-known chefs, food writers, and gourmands — a composition that gratifies chefs whose restaurants make the list with the knowledge they have the respect of their peers. “To know that the people you so admire return the affection is a beautiful feeling,” explains Roca. Yet for all its success, the ranking has always been plagued by controversy . There is no prohibition against lobbying, nor are voters required to pay for their meals, so some countries’ tourist boards — and even some individual restaurants — have subsidized expensive junkets to bring jurors to their tables. The list has also had difficulties achieving regional and gender diversity . Only 16 — a historic high — of the restaurants on 2018’s list are located outside of Europe or the United States. Five of them (also a record high) are led by women, although three of the women (at Arzak in San Sebastian, Cosme in New York, and Central in Lima) share their restaurant’s head position with a man, and another (at Nahm in Bangkok) assumed the role from its former male head chef too late in the year to have been considered. A picture taken on July 7, 2016 shows employees working in the kitchen of the While some individuals gripe about “forcing” women onto the panel, the restaurant industry as a whole has become widely alert to its need to reduce its long-entrenched sexism, especially in the wake of #MeToo, which revealed harassment and abuse at a number of formerly well-regarded restaurants . So far,the measure has not been met with significant resistance. More controversial, however, is the decision to remove previous number #1s from subsequent competitions. The organization presented the move as part of its efforts to diversify the list’s upper echelons. “There was some stagnation in the top 10,” says Pietrini. “We don’t want to artificially skew it, but we think it’s a healthy decision to make sure we’ve got a new dynamic every year.” Yet although World’s 50 Best decided to create The Best of the Best itself, TIME reporting found that the rule change to withdraw winning restaurants from subsequent competition did not come from the organization itself. It was actually proposed — some would say imposed — by half a dozen or so highly ranked chefs, some of them former #1s, some of them close to the top.. Massimo Bottura, whose Modena restaurant Osteria Francescana took the top slot in 2016 and regained it last year, was one of them. “In the last several years it’s been us, the Rocas, and René Redzepi as at least two of the three best restaurants in the world,” he says of their motives. “I think it’s time for others to be there, especially from the younger generation.” Bottura says he first heard of the idea years ago from Gaston Acurio, whose Lima restaurant Astrid y Gaston is currently #39 on the list. “When I accepted the award [in 2013] for best restaurant in Latin America, I said to the audience that I hoped to see someone new in my place the following year,” Acurio says, adding that he later mentioned the idea to the organization’s administration. “I believe the 50 Best shouldn’t be a tool for competition but a union that promotes excellence, diversity, and talent.” But according to a source with knowledge of the process who asked for anonymity because he did not have permission to speak publicly on the subject, the core group that began pressing in earnest for the change last year was driven not only or even primarily by an attempt to unclog the top, but also by an effort to avoid the decline in reputation that some notable chefs have suffered once they fell from first place. Daniel Humm, whose restaurant Eleven Madison Park in New York won the top spot in 2017, acknowledges the impact of a drop was a factor in the group’s proposal. “We’ve seen restaurants fall down the list even though they were getting better and better,” he says. ”There have been a few chefs in the past who started to feel more pissed off and mistreated, and they started to not show up [to the ceremony], and that was hurting the whole thing, because the spirit of 50 Best is community.” People enter the Noma restaurant in Copenhagen, on April 27, 2010 the day after Noma was chosen for the world's best restaurant, according to the Worlds 50 Best Restaurants Award, which was awarded in London. | Casper Christoffersen—AFP/Getty Images For a handful of chefs to upend the rules of the game in order to avoid the perception of diminishment gives a sense of just how influential the ranking has become. Some highly-regarded chefs tell TIME they have experienced depression for failing to make the list, while others, like Christopher Kostow of Napa Valley’s Meadowood, have lambasted it for skewing toward the new and “hot” rather than rewarding the kind of excellence that comes only with years of practicing a craft. “It’s an assassin list,” agrees Ferran Adrià, whose restaurant elBulli held the title five times before it closed in 2011. He, like Redzepi, only learned of the new rule once it was publicly announced. “Once you fall, you disappear not only from the list, but from the [industry’s] whole little world.” Yet, by removing winners from subsequent consideration, the new rule may well undermine 50 Best’s own influence. In the past, the sustained presence of a restaurant like elBulli or Noma in the top slot helped turn their respective countries into gastronomic powerhouses . “If a chef in Seoul won four times in a row, Korea would become an international culinary destination,” says Adrià. “If she wins only once, it’s nice for her, but it won’t have the same effect.” And of course, the ranking itself runs the risk of losing credibility since it no longer represents all of the best restaurants. “That’s exactly the kind of question we asked ourselves,” Pietrini admits of the administration’s deliberations. “It was not a quick decision. I know there are rumors that we were pressured into it. I will only say that at the end of the day, the decision was ours alone. And we would not have made that decision without a long-term plan.” As part of that long-term plan, the organization appears to recognize that its future may not lie with the ranking. Later this year, it will launch a global database, called 50 Best Discovery, that tracks restaurants that garnered votes but not enough to make the ranking, and will also include bars from its sister list . “We want to take 50 Best from a listmaker to a media platform, and as I like to say internally, a progressive force,” she says. “Our objective is not to be more influential.” Of course, they may not have much choice in the matter. Other awards, rankings, and guidebooks have emerged in recent years, and although none has yet attained the prominence of 50 Best, they have eroded the perception of the list as the newest, most plugged-in kid on the block. Ana Ros of the Hisa Franko restaurant in Kobarid, Slovenia, cooks one of the most surprising meals of the weekend at Exquisite Corpse, in New York City's Chelsea district, September 24, 2011, thrusting her tiny country into New York's limelight. | Andrew Eaves—AFP/Getty Images And the impact on bookings and attention that 50 Best enjoyed now been far surpassed by the wildly influential Netflix show Chef’s Table . Ana Ros, of Slovenia’s Hisa Franko, goes so far as to say the show, on which she appeared in 2016, saved her business. “We went from having empty tables several months of the year to having a permanent waitlist,” she says. “Although we assume being on the list has had an impact (Hisa Franko entered the top 50 last year, at #48), we don’t know for sure. It hasn’t been as noticeable”. Even more challenging has been the rise of social media; to a significant degree, millennials make their decisions about where to eat based on what they see on Instagram, rather than on conventional reviews or rankings. That’s part of the reason why, after nearly a century of independence, the storied Michelin guide, which saw its own influence wane with the rise of World’s 50 Best, now accepts commissions from countries or regions eager for its coverage; Austria, for example, recently paid 600,000 euros to revive its defunct red guide. One test of World’s 50 Best’s continued relevance at this year’s ceremony in Singapore will have less to do with who steps onto the stage to receive its top award than with who is applauding from the audience. In the past, the ceremony drew nearly every name on the list, along with dozens of other chefs who came for the party and the chance to see friends from all over the world. But increasingly, even chefs who have been recognized by it — like Christian Puglisi of Copenhagen’s Relæ, who won the organization’s sustainable restaurant award in 2015 and 2016 (#56 on this year’s list) and Dominique Crenn , who in 2016 won the organization’s controversial Best Female Chef award — are speaking out against the kind of publicity, networking, and deep pockets that the list is perceived as rewarding. And this year, some heavy hitters, including Grant Achatz of Alinea (#34 in 2018) and — even though Noma is a contender for #1 — Redzepi won’t be there. Redzepi is staying home because the ceremony conflicts with the opening of a new menu at Noma. But he is also opposed to the rule change, and wonders if it will ultimately reduce World’s 50 Best’s influence. “If a chef manages to create a restaurant that defines the zeitgeist for more than one year, shouldn’t the list reflect that?” he asks. That criticism is shared by Ros in Slovenia, even though her restaurant stands to benefit from the change. “I think it’s a faux pax that may hurt them,” she says. “I’m an ex-athlete, so I don’t understand how you can tell someone they can’t compete.” As a former professional cyclist himself, Daniel Humm understands the sentiment. Although he says that he is “at total peace” with the fact that Eleven Madison Park is no longer eligible for the list, he’ll be attending the Singapore ceremony with mixed feelings. “I’ve got competition in my blood, so I’ve always liked going into that room,” he says of the hall where the world’s best chefs gather to learn of their ranking. “It’s like in basketball when it goes down to buzzer and there’s a guy taking a three point shot. I always want to be the guy with the ball.” |
Symptoms of dry drowning every parent should know
You may think your child is safe once he or she leaves the water -- but for some, fatalities can occur even 24 hours after swimming.
As the summer months heat up, it's important for parents and caregivers to be extra vigilant about water safety, including taking precautions against the little-known condition called dry drowning. It can kill up to 3500 people per year, including thisfour-year-old boy. And while dry drowning can affect adults, it's "more common" in children because of the small size of their bodies, saidWebMD.
See the symptoms of dry drowning below:
According to Parents.com, dry drowning accounts for only about "2 percent of drowning incidents" -- but symptoms can emerge after the child leaves the water.Parents.comexplains that while "dry" and "secondary" are often used interchangeably, each may bring different symptoms.
Unlike wet drowning -- which happens when "submerged" underwater, filling the lungs with water -- water never reaches the lungs during dry drowning. "Instead,breathingin water causes your child's vocal cords to spasm and close up after he's already left the pool, ocean, or lake,"according toWebMd. Since the airways are closed off, breathing is compromised. Symptoms occur soon after the child leaves the water.
Alternatively, secondary drowning is when water reaches and builds up in the lungs, causingpulmonary edemaand making it difficult to breathe. Signs of secondary drowning are evident later, within one to 24 hours after the child leaves the water.
"When they first get out of the water, they may cough and then will normally be okay. As the day goes on, breathing gets a bit faster and just progresses. They will be working harder to breathe, with the belly moving in and out or the ribs showing the strain," said Dr. Ray Pitetti, an associate medical director of emergency pediatric medicine,to the Daily Mail.
However, each is equally dangerous, making it all the more important for parents to look out for these symptoms even after an incident occurs. If a parent notices these aforementioned signs, they should either call their pediatrician or 911.
How can you prevent dry and secondary drowning? Keep an eye on the kids, install fences around the pool and schedule swimming lessons. Plus, CPR is a life-saving skill to have -- and educate other parents on dry drowning dangers. |
Trafigura's Puma Energy hires BAML for asset sale - sources
By Julia Payne and Dmitry Zhdannikov
LONDON, June 21 (Reuters) - Puma Energy, the retail and storage arm of commodities trader Trafigura, has hired Bank of America Merrill Lynch (BAML) to run the sale of some of its assets, sources familiar with the matter said, in an effort to trim debt.
Assets in the Democratic Republic of Congo, South Africa, Senegal and Australia were among those slated to be sold, one source said.
A Puma spokeswoman declined to comment on the specific assets for sale. BAML and Trafigura also declined to comment.
In its first-quarter results unveiled in May, Puma announced two non-core asset sales but gave no details.
Puma has suffered net losses due largely to a currency devaluation in Angola and increased competition in Australia that affected the profitability of its fuel stations.
The company posted a net loss of $30 million for 2018 and a net loss of $15 million in the first quarter this year.
Puma also faces pressure from ratings agencies. In September and October last year, Fitch and Moody's changed their outlooks on Puma to negative, meaning downgrades could loom this year if insufficient action is taken to reduce debt.
Between 2017 and 2018, Puma raised $1.35 billion in bonds due in 2024 and 2026.
Puma's chief executive Emma Fitzgerald took over in January from Pierre Eladari, who oversaw a period of expansion. Fitzgerald has hired new senior management including a chief financial officer, a head for Africa and a chief transformation officer.
A review of the business by consulting firm McKinsey was completed in March, Puma said.
Recent measures taken by the company included a renegotiation of two debt covenants and a board change. Cochan Holdings, which is run by a former Angolan general and owns 15% of Puma, is no longer represented on the board, Puma said.
Puma's spokeswoman said the firm was complying with its covenants.
"We have a stated commitment to deleveraging the balance sheet via portfolio refocus ... Assuming a successful portfolio review and subsequent asset divestments without major disruption, our target net debt over EBITDA ratio for the end of 2020 is <2.5x," she added.
Puma, which traces its roots to Argentina, has more than 3,100 fuel retail stations in Latin America, Africa and Asia-Pacific. Trafigura owns 49% of Puma, Angola's state firm Sonangol holds 28% and 7% is held by other investors. (Reporting by Julia Payne and Dmitry Zhdannikov; Additional reporting by Ron Bousso; Editing by Dale Hudson) |
Is Guyana Goldstrike's (CVE:GYA) 271% Share Price Increase Well Justified?
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It hasn't been the best quarter forGuyana Goldstrike Inc.(CVE:GYA) shareholders, since the share price has fallen 30% in that time. But that doesn't undermine the rather lovely longer-term return, if you measure over the last three years. In three years the stock price has launched 271% higher: a great result. So the recent fall in the share price should be viewed in that context. The thing to consider is whether the underlying business is doing well enough to support the current price.
See our latest analysis for Guyana Goldstrike
Guyana Goldstrike 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. It seems likely some shareholders believe that Guyana Goldstrike will find or develop a valuable new mine before too long.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. 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. Guyana Goldstrike has already given some investors a taste of the sweet gains that high risk investing can generate, if your timing is right.
Our data indicates that Guyana Goldstrike had CA$612,028 more in total liabilities than it had cash, when it last reported in December 2018. That puts it in the highest risk category, according to our analysis. So we're surprised to see the stock up 55% per year, over 3 years, but we're happy for holders. Investors must really like its potential. You can see in the image below, how Guyana Goldstrike's cash levels have changed over time (click to see the values).
Of course, the truth is that it is hard to value companies without much revenue or profit. Given that situation, many of the best investors like to check if insiders have been buying shares. It's usually a positive if they have, as it may indicate they see value in the stock. Luckily we are in a position to provide you with thisfreechart of insider buying (and selling).
Investors in Guyana Goldstrike had a tough year, with a total loss of 63%, against a market gain of about 1.6%. 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. On the bright side, long term shareholders have made money, with a gain of 24% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. Most investors take the time to check the data on insider transactions. You canclick here to see if insiders have been buying or selling.
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA 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. |
Eldorado Resorts, Inc. (NASDAQ:ERI): Poised For Long Term Success?
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In March 2019, Eldorado Resorts, Inc. (NASDAQ:ERI) released its earnings update. Generally, analysts seem extremely confident, as a 63% rise in profits is expected in the upcoming year, compared with the historical 5-year average growth rate of 37%. By 2020, we can expect Eldorado Resorts’s bottom line to reach US$155m, a jump from the current trailing-twelve-month of US$95m. Below is a brief commentary around Eldorado Resorts's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you canresearch its fundamentals here.
Check out our latest analysis for Eldorado Resorts
The longer term expectations from the 10 analysts of ERI is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of ERI's earnings growth over these next few years.
By 2022, ERI's earnings should reach US$200m, from current levels of US$95m, resulting in an annual growth rate of 16%. This leads to an EPS of $3.15 in the final year of projections relative to the current EPS of $1.23. Margins are currently sitting at 4.6%, which is expected to expand to 8.1% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Eldorado Resorts, I've compiled three essential factors you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is Eldorado Resorts worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether Eldorado Resorts is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of Eldorado Resorts? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
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. |
Australia Central Bank Argues Bitcoin ‘Unlikely’ To Become Mainstream
Australia’scentral banksaid bitcoin (BTC) andcryptocurrencieswould remain outside mainstream payments in a dedicatedarticleissued on June 20.
Titled ‘Cryptocurrency: Ten Years On,’ the document from the Reserve Bank of Australia (RBA) appears to commemorate the past decade of bitcoin’s existence while admitting zero faith in its future beyond a niche asset.
“Despite achieving some name recognition, cryptocurrencies are not widely used for payments,” its abstract summarizes.
“This article examines why Bitcoin is unlikely to become a ubiquitous payment method in Australia, and summarises how subsequent cryptocurrencies have sought to address some of the shortcomings of Bitcoin – such as its volatility and scalability problems.”
Australia’s government remainshighly risk-averseon cryptocurrency in general, choosing to warn consumers about perceived risks while adopting an aggressivetaxationand data collection policy.
As Cointelegraphreported, in April, the country’s tax agency, the Australian Tax Office (ATO), said it would seek to gain records fromexchangesin order to conduct individual audits on users as and when necessary.
Earlier this month, itemergedinvestigators were conducting 12 cross-border operations focusing on tax avoidance related to cryptocurrencies.
“At the Australian level, there is definitely legitimate use for investment in cryptocurrencies, but we're also seeing the use of them to facilitate tax crimes,” ATO deputy commissioner, Will Day, commented at the time.
The RBA article nonetheless appears to paint a less optimistic picture, championing the Australian dollar as a preferable alternative to cryptocurrency.
The researchers concluded:
“As long as the Australian dollar continues to provide a reliable, low-inflation store of value, and the payments industry continues to work on the efficiency, functionality and resilience of the Australian payments system, it is difficult to envisage cryptocurrencies presenting a compelling proposition that would lead to their widespread use in Australia.”
• 4 Big Reasons Bitcoin’s Price Will Probably Not Stop at $20K This Time
• Fidelity-Backed Crypto Analytics Firm to Integrate Twitter-Based Crypto Sentiment Feed
• Craig Wright Ordered to Personally Appear at Bitcoin Theft Mediation
• Former Wall Street Exec Tone Vays: There Is No Evidence That the Crypto Winter Is Now Over |
U.S. 'very pleased' that Saudi Arabia ensuring well-supplied oil market
RIYADH (Reuters) - The United States is "very pleased" that Saudi Arabia is making sure that the global oil market is well supplied, a U.S. official said on Friday, amid fears of energy disruption because of growing military tension in the Middle East.
"They have been very helpful at ensuring the well-supplied and stable oil market, and so we're very pleased," U.S. envoy on Iran, Brian Hook, told a news conference in the Saudi capital Riyadh.
(Reporting by Stephen Kalin; writing by Maher Chmaytelli; Editing by Kevin Liffey) |
What does Envestnet, Inc.'s (NYSE:ENV) Balance Sheet Tell Us About Its Future?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Stocks with market capitalization between $2B and $10B, such as Envestnet, Inc. ( NYSE:ENV ) with a size of US$3.6b, do not attract as much attention from the investing community as do the small-caps and large-caps. While they are less talked about as an investment category, mid-cap risk-adjusted returns have generally been better than more commonly focused stocks that fall into the small- or large-cap categories. ENV’s financial liquidity and debt position will be analysed in this article, to get an idea of whether the company can fund opportunities for strategic growth and maintain strength through economic downturns. Don’t forget that this is a general and concentrated examination of Envestnet’s financial health, so you should conduct further analysis into ENV here . Check out our latest analysis for Envestnet Does ENV Produce Much Cash Relative To Its Debt? Over the past year, ENV has ramped up its debt from US$422m to US$551m , which includes long-term debt. With this rise in debt, the current cash and short-term investment levels stands at US$246m to keep the business going. Moreover, ENV has generated US$106m in operating cash flow over the same time period, leading to an operating cash to total debt ratio of 19%, meaning that ENV’s current level of operating cash is not high enough to cover debt. Can ENV meet its short-term obligations with the cash in hand? At the current liabilities level of US$339m, it seems that the business has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.03x. The current ratio is calculated by dividing current assets by current liabilities. Generally, for Software companies, this is a reasonable ratio since there is a bit of a cash buffer without leaving too much capital in a low-return environment. NYSE:ENV Historical Debt, June 21st 2019 Is ENV’s debt level acceptable? With debt reaching 75% of equity, ENV may be thought of as relatively highly levered. This is not unusual for mid-caps as debt tends to be a cheaper and faster source of funding for some businesses. But since ENV is presently unprofitable, sustainability of its current state of operations becomes a concern. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns. Next Steps: ENV’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow. Since there is also no concerns around ENV's liquidity needs, this may be its optimal capital structure for the time being. This is only a rough assessment of financial health, and I'm sure ENV has company-specific issues impacting its capital structure decisions. I suggest you continue to research Envestnet to get a better picture of the mid-cap by looking at: Story continues Future Outlook : What are well-informed industry analysts predicting for ENV’s future growth? Take a look at our free research report of analyst consensus for ENV’s outlook. Valuation : What is ENV worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether ENV is currently mispriced by the market. Other High-Performing Stocks : Are there other stocks that provide better prospects with proven track records? Explore our free 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 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. View comments |
Do Institutions Own DXStorm.com Inc. (CVE:DXX) Shares?
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The big shareholder groups in DXStorm.com Inc. (CVE:DXX) have power over the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'
DXStorm.com is not a large company by global standards. It has a market capitalization of CA$415k, which means it wouldn't have the attention of many institutional investors. In the chart below below, we can see that institutional investors have not yet purchased shares. Let's take a closer look to see what the different types of shareholder can tell us about DXX.
View our latest analysis for DXStorm.com
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
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. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. DXStorm.com might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
Hedge funds don't have many shares in DXStorm.com. As far I can tell there isn't analyst coverage of the company, so it is probably flying under the radar.
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 most recent data indicates that insiders own a reasonable proportion of DXStorm.com Inc.. Insiders have a CA$70k stake in this CA$415k business. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You canclick here to see if those insiders have been buying or selling.
The general public, mostly retail investors, hold a substantial 60% stake in DXX, suggesting it is a fairly popular stock. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
Our data indicates that Private Companies hold 23%, 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.
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. |
YIELD GROWTH Announces OLCC Approval of 3 Additional Cannabis Products for Distribution in Oregon
Vancouver, British Columbia--(Newsfile Corp. - June 21, 2019) -The Yield Growth Corp. (CSE: BOSS) (OTCQB: BOSQF) (FSE: YG3)is pleased to announce that the Oregon Liquor Control Commission (OLCC) yesterday gave final packaging approval for 3 additional Wright & Well cannabis products to be distributed in Oregon, in the United States. Manufacturing will now begin on all 9 Wright & Well cannabis products in Oregon.
Wright & Well THC and CBD-Infused Therapeutic ProductsTo view an enhanced version of this graphic, please visit:https://orders.newsfilecorp.com/files/6377/45785_image1.jpg
According to Statista, legal sales of Cannabis in Oregon are projected to be close to USD$1 billion in 2021.
The latest 3 approved Wright & Well products are:
• Be Nimble Marijuana Capsules with Blue City Diesel Cannabis Flower and a blend of Ayurvedic herbs;
• Be Able Marijuana Capsules with Purple Hindu Cush Cannabis Flower and Aloe Vera, Dill and other herbs; and
• Be Friendly Marijuana Capsules with Cherry Chem Cannabis flower and a blend of Ayurvedic herbs intended to treat symptoms of PMS.
"Wright & Well's goal is to demystify the world of cannabis to allow people to make it part of a healthy lifestyle," says Penny a Green, Yield Growth CEO. "We want to compel users to experience the same sense of freedom from feeling great as they do from making the decision to purchase Wright & Well."
The Wright & Well product launch in Oregon will be supported by in store merchandising and educational materials, as well as a full marketing campaign including digital media, print and billboards.
About The Yield Growth Corp.
The Yield Growth Corp. harnesses the power of hemp- and cannabis-infused products in the global wellness market, which is worth $4.2 trillion, according to the Global Wellness Institute. The Yield Growth management team has deep experience with global brands including Johnson & Johnson, Procter & Gamble, M·A·C Cosmetics, Skechers, Best Buy, Aritzia, Coca-Cola and Pepsi Corporation. Its consumer brand, Urban Juve, has signed over 110 retail locations to sell its products in North America and is now launching e-commerce sales in China through Wechat. Urban Juve has signed a sales and marketing alliance with the beauty subscription service, ipsy, and Urban Juve products will be included in ipsy Glam Bags. Yield's THC line of Wright & Well products are launching next month in Oregon through an established distributor with a 400 cannabis retail store network.
Through its subsidiaries, Yield Growth has developed over 200 cannabis beauty, wellness, and beverage formulas for commercialization. A key ingredient in many of these products is Urban Juve's hemp root oil, created using Urban Juve's proprietary, patent-pending extraction technology. Yield Growth is in revenue through multiple streams including licensing, services and product sales.
For more information about Yield Growth, visitwww.yieldgrowth.comor follow@yieldgrowthon Instagram. Visitwww.urbanjuve.comand #findyourjuve across social platforms to learn, engage and shop.
Investor Relations Contacts:
Penny Green, President & CEO
Kristina Pillon, Investor Relations
invest@yieldgrowth.com
1-833-514-BOSS1-833-514-26771-833-515-BOSS1-833-515-2677
The Canadian Securities Exchange has not reviewed, approved or disapproved the content of this news release.
Cautionary Statement Regarding Forward-Looking Statements
This press release includes forward-looking information and statements (collectively, "forward looking statements") under applicable Canadian securities legislation. Forward-looking statements are necessarily based upon a number of estimates, forecasts, beliefs and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties, and other factors which may cause the actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such risks, uncertainties and factors include, but are not limited to: risks related to the development, testing, licensing, intellectual property protection, and sale of, and demand for, Urban Juve, Wright & Well, UJ Beverages and UJ Edibles products, general business, economic, competitive, political and social uncertainties, delay or failure to receive board or regulatory approvals where applicable, and the state of the capital markets. Yield Growth cautions readers not to place undue reliance on forward-looking statements provided by Yield Growth, as such forward-looking statements are not a guarantee of future results or performance and actual results may differ materially. The forward-looking statements contained in this press release are made as of the date of this press release, and Yield Growth expressly disclaims any obligation to update or alter statements containing any forward-looking information, or the factors or assumptions underlying them, whether as a result of new information, future events or otherwise, except as required by law.
To view the source version of this press release, please visithttps://www.newsfilecorp.com/release/45785 |
Is CXHYX a Strong Bond Fund Right Now?
Having trouble finding a Muni - Bonds fund? Delaware National High Yield Municipals A (CXHYX) is a potential starting point. CXHYX carries a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
Zacks categorizes CXHYX as Muni - Bonds, which is a segment packed with options. Muni - Bonds funds invest in debt securities issued by states or local municipalities. These are generally used to finance construction of infrastructure, pay for schools, or other government functions. Some are backed by taxes (revenue bonds), while others are " general obligation " and may not be backed by a defined source. Investors usually appreciate the tax benefits that come with many municipal bonds, which are especially impressive for those in high tax brackets.
History of Fund/Manager
Delaware Investments is based in Philadelphia, PA, and is the manager of CXHYX. Delaware National High Yield Municipals A made its debut in September of 1986, and since then, CXHYX has accumulated about $192.13 million in assets, per the most up-to-date date available. The fund's current manager is a team of investment professionals.
Performance
Investors naturally seek funds with strong performance. This fund has delivered a 5-year annualized total return of 5.42%, and it sits in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 4.46%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. Compared to the category average of 5.98%, the standard deviation of CXHYX over the past three years is 4.28%. The fund's standard deviation over the past 5 years is 3.62% compared to the category average of 6.05%. This makes the fund less volatile than its peers over the past half-decade.
Bond Duration
Modified duration is a measure of a specific bond's interest rate sensitivity, and is an excellent way to judge how fixed income securities will respond to a shifting rate environment.
For investors who think interest rates will rise, this is an important factor to consider. CXHYX has a modified duration of 6.62, which suggests that the fund will decline 6.62% for every hundred-basis-point increase in interest rates.
Income
It is important to consider the fund's average coupon because income is often a big reason for purchasing a fixed income security. Average coupon is a look at the average payout by the fund in a given year. For example, this fund's average coupon of 5.71% means that a $10,000 investment should result in a yearly payout of $571.
For those seeking a strong level of current income, a higher coupon is typically good news. However, it could pose a reinvestment risk if rates are lower in the future when compared to the initial purchase date of the bond.
Income is only one part of the bond picture, investors also need to consider risk relative to broad benchmarks. This fund has a beta of 1.1, meaning that it is more volatile than a broad market index of fixed income securities. Taking this into account, CXHYX has a positive alpha of 1.51, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, CXHYX has 31.86% in medium quality bonds, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 23.02%, giving CXHYX an average quality of BBB. This means that it focuses on medium quality securities.
However, it is worth noting that 35 % of the bonds in this fund are not ranked, so take the average quality level with a bit of caution.
Expenses
Costs are increasingly important for mutual fund investing, and particularly as competition heats up in this market. And all things being equal, a lower cost product will outperform its otherwise identical counterpart, so taking a closer look at these metrics is key for investors. In terms of fees, CXHYX is a load fund. It has an expense ratio of 0.85% compared to the category average of 0.85%. CXHYX is actually on par with its peers when you consider factors like cost.
Investors should also note that the minimum initial investment for the product is $1,000 and that each subsequent investment needs to be at $100.
Bottom Line
Overall, Delaware National High Yield Municipals A ( CXHYX ) has a high Zacks Mutual Fund rank, strong performance, average downside risk, and on par fees compared to its peers.
For additional information on this product, or to compare it to other mutual funds in the Muni - Bonds, make sure to go to www.zacks.com/funds/mutual-funds for additional information. Zacks provides a full suite of tools to help you analyze your portfolio - both funds and stocks - in the most efficient way possible.
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 reportGet Your Free (CXHYX): Fund Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Is LBNDX a Strong Bond Fund Right Now?
Any investors hoping to find a High Yield - Bonds fund could think about starting with Lord Abbett Bond Debenture A (LBNDX). LBNDX holds a Zacks Mutual Fund Rank of 2 (Buy), which is based on nine forecasting factors like size, cost, and past performance.
Objective
LBNDX is part of the High Yield - Bonds section, which is a segment that boasts many possible options. Often referred to as " junk " bonds, High Yield - Bonds funds sit below investment grade, meaning they are at a high default risk compared to their investment grade peers. However, one advantage to junk bonds is that they generally pay out higher yields while posing similar interest rate risks to their investment grade counterparts.
History of Fund/Manager
Lord Abbett is based in Jersey City, NJ, and is the manager of LBNDX. Lord Abbett Bond Debenture A debuted in April of 1971. Since then, LBNDX has accumulated assets of about $4.25 billion, according to the most recently available information. The fund is currently managed by a team of investment professionals.
Performance
Of course, investors look for strong performance in funds. This fund in particular has delivered a 5-year annualized total return of 4.35%, and is in the top third among its category peers. But if you are looking for a shorter time frame, it is also worth looking at its 3-year annualized total return of 6.52%, which places it in the top third during this time-frame.
When looking at a fund's performance, it is also important to note the standard deviation of the returns. The lower the standard deviation, the less volatility the fund experiences. The standard deviation of LBNDX over the past three years is 4.07% compared to the category average of 8.4%. Over the past 5 years, the standard deviation of the fund is 4.81% compared to the category average of 8.79%. This makes the fund less volatile than its peers over the past half-decade.
Bond Duration
Modified duration is a measure of a given bond's interest rate sensitivity, so when judging how fixed income securities will respond in a shifting rate environment, it is an excellent figure to look at.
If you believe interest rates will rise, this is an important factor to look at. LBNDX has a modified duration of 5.63, which suggests that the fund will decline 5.63% for every hundred-basis-point increase in interest rates.
Income
Since income is, of course, a big reason for purchasing a fixed income security, it is always important to consider the fund's average coupon. Average coupon is a look at the average payout by the fund in a given year. For example, this fund's average coupon of 5.32% means that a $10,000 investment should result in a yearly payout of $532.
While a higher coupon is good for when you want a strong level of current income, it could present a reinvestment risk if rates are lower in the future when compared to the initial purchase date of the bond.
Investors also need to consider risk relative to broad benchmarks, as income is only one part of the bond picture. With a beta of 0.45, this fund is less volatile than a broad market index of fixed income securities. Taking this into account, LBNDX has a positive alpha of 2.86, which measures performance on a risk-adjusted basis.
Ratings
Investors should also consider a bond's rating, which is a grade ( 'AAA' to 'D' ) given to a bond that indicates its credit quality. With this letter scale in mind, LBNDX has 28.4% in medium quality bonds, with ratings of 'A' to 'BBB'. The fund's junk bond component-bonds rated 'BB' or below-is at 51.45%, giving LBNDX an average quality of BBB. This means that it focuses on medium quality securities.
Expenses
For investors, taking a closer look at cost-related metrics is key, since costs are increasingly important for mutual fund investing. Competition is heating up in this space, and a lower cost product will likely outperform its otherwise identical counterpart, all things being equal. In terms of fees, LBNDX is a load fund. It has an expense ratio of 0.79% compared to the category average of 1.02%. Looking at the fund from a cost perspective, LBNDX is actually cheaper than its peers.
While the minimum initial investment for the product is $1,000, investors should also note that there is no minimum for each subsequent investment.
Bottom Line
Overall, Lord Abbett Bond Debenture A ( LBNDX ) has a high Zacks Mutual Fund rank, strong performance, average downside risk, and lower fees compared to its peers.
This could just be the start of your research on LBNDXin the High Yield - Bonds category. Consider going to www.zacks.com/funds/mutual-funds for additional information about this fund, and all the others that we rank as well for additional information. For analysis of the rest of your portfolio, make sure to visit Zacks.com for our full suite of tools which will help you investigate all of your stocks and funds in one place.
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 reportGet Your Free (LBNDX): Fund Analysis ReportTo read this article on Zacks.com click here. |
Is Russia disconnecting its internet from the rest of the world?
A new bill is currently being considered in Russia that could see the country disconnect from the global internet and create its own isolated network. The country was initially looking into the possibility of creating its own internet to counteract the threat of being isolated from the global internet with no contingency plans in place. However, with the idea now seemingly gaining credence, Russia may go ahead and disconnect from the global internet anyway. The idea is still in the infancy stage, and the government has noted the need to identify sources of additional funding from providers for the introduction of special equipment. But it seems the idea is gaining traction and may become reality sooner rather than later. Why is Putin preparing Russia to turn off the internet? The threat of Russia being cut off from the global internet exists in theory, since it is impossible to predict the actions of other countries. This was stated by Russian President Vladimir Putin at a meeting with representatives of Russian news agencies and the print media. Putin acknowledged that such a move would inflict not only political, but also economic damage, as well as adversely affect the work of Western intelligence agencies. He said: They are sitting there, its their invention, and everyone listens, sees, and reads what they say, and accumulates this information, and they will not want to do this. He continued to say that Russia needs to create independent network segments to counteract any threat of isolation. Russian deputies have since passed a draft law on the sustainability of a Russian internet segment. According to the document, centralised internet management within Russia is possible so long as stability is maintained. It has been reported that the authorities will allocate 20 billion rubles for its implementation. How long has this been in development? The idea has been in development for quite some time within the framework of the Digital Economy project. Work has already been carried out to stabilise the internet in Russia, with the infrastructure of companies that process personal data, state authorities, banks, and many other socially significant industries being moved to data centers that are located in Russia. The Russian military created its own internal infrastructure which functions by bypassing the internet a long time ago so that in the case of a shutdown of the Runet, everything will carry on as normal. What will happen if Russia disconnects from the internet? In the modern global economy, high-speed connections and the ability to exchange data are key in all economic areas without exception. Therefore, disconnecting from the global internet will mean a loss of openness in the Russian economy and will bring about true self-isolation. Story continues Significant damage will be inflicted on exchanges whose operation is directly dependent on the situation in foreign markets. To a large extent, disconnection from the worldwide network will also affect the investment appeal of the Russian economy, since foreign investors will not be able to effectively manage and receive constant information about Russian markets. Domestic companies will also suffer as they will not be able to fulfill foreign orders and scientists and programmers wont be able to participate in international projects. All of this will have a detrimental effect on the prospects of the Russian economy. The lack of constant communication will complicate the work of Russian agriculture businesses and farmers, who rely on foreign companies to acquire a significant proportion of seeds for sowing. Disconnection from the internet concerns many industries that acquire foreign equipment and components and export their goods. Commercial ties will eventually be restored through new channels, but this will result in the loss of valuable time and money. Examples of previous internet blocking cases In recent history, you can find a few examples of heavy damage being caused as a result of the short-term shutdown of the internet. In 2005, in one of the ports of Kenya, a carelessly cast anchor left six African countries without an internet connection. In the week that repair work was being carried out, the Kenyan economy lost $500 million. A similar situation occurred in Egypt in 2011, when during the riots in Tahrir Square, the government turned off the internet. As a result, during the entire isolation period, the country was losing around $18 million a day. Russian protests Citizens of Russia believe that the new bill is a brazen violation of freedom and human rights. Russian isolation entails the use of slow and poor-quality connections. The government of Russia has decided that while the equipment for the implementation will be provided by the state, the installation will have to be organised by the providers themselves. The entire burden will therefore be placed on the shoulders of users, because the providers will not want to work for free and will charge for the installation. People will also have to pay more for services that can no longer be carried out on the global internet. Understanding this, the citizens of Russia began to protest against the proposal. Around 15,000 people campaigned at a recent rally against the isolation of the internet in Moscow. Opposition groups reported on the arrest of participants in the rally in Sakharov Square. Conclusion The proposal has not yet been adopted, but it is seemingly already working against the Russian government. This issue will affect literally all young people and citizens of active working age who rely on the international exchange of information, goods, and communications. Russian citizens may be forced to take their innovations and talents abroad. The number of professional migrants from Russia will increase, depriving the country of the possibility of innovative breakthroughs in all areas. In my opinion, there will be no internet disconnection in Russia. The economies of every country in the world are tied to world relations, and the internet has become an object of business. Millions of goods and services are sold and bought on the internet every day, and this global web is already inextricably linked with each of us. The Constitution of the Russian Federation states that all citizens have the right to search, receive, and transfer information. It is therefore the duty of the state to ensure these rights. Find out more about cryptocurrency in Russia here on Coin Rivet: Putin steps in over alleged crypto money launderer wanted by the US By Sam Webb June 21, 2019 The post Is Russia disconnecting its internet from the rest of the world? appeared first on Coin Rivet . View comments |
What Kind Of Shareholder Owns Most DXStorm.com Inc. (CVE:DXX) Stock?
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A look at the shareholders of DXStorm.com Inc. (CVE:DXX) 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. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'
DXStorm.com is a smaller company with a market capitalization of CA$415k, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have not yet purchased shares. Let's take a closer look to see what the different types of shareholder can tell us about DXX.
View our latest analysis for DXStorm.com
Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.
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. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. DXStorm.com might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.
Hedge funds don't have many shares in DXStorm.com. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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.
It seems insiders own a significant proportion of DXStorm.com Inc.. Insiders have a CA$70k stake in this CA$415k business. It is great to see insiders so invested in the business. It might be worth checkingif those insiders have been buying recently.
The general public -- mostly retail investors -- own 60% of DXStorm.com . This size of ownership gives retail investors collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.
We can see that Private Companies own 23%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
It's always worth thinking about the different groups who own shares in a company. But to understand DXStorm.com 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 would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, backed by strong financial data.
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. |
France Creates G7 Taskforce to Examine Facebook’s Libra, Crypto Regulation
A G7 taskforce is being created to examine howcentral bankscan regulatecryptocurrenciessuch asFacebook’slibra, Reutersreportedon June 21.
Francois Villeroy de Galhau, the governor ofFrance’scentral bank, said:
“We want to combine being open to innovation with firmness on regulation. This is in everyone’s interest.”
AlthoughParishas said it is not against Facebook creating a financial instrument, it vehemently opposes libra becoming a sovereign currency.
Concerns have been raised over how to ensure cryptocurrencies comply withanti-money launderinglaws, consumer protection rules and other regulatory matters.
The G7 taskforce is going to be led by Benoit Coeure, who sits on the board of theEuropean Central Bank.
Global reaction to libra has been mixed. Jerome Powell, the head of theUnited StatesFederal Reserve, has said herecognizespotential benefits and risks to the new project. Meanwhile, the chairwoman of the U.S. Financial Services Committee hasurgedthe social network to halt development until an investigation can take place.
On June 18, discussing libra,Bank of Englandgovernor Mark Carney said hebelieveshis central bank “will wind up having quite high expectations from a safety and soundness and regulatory standpoint.”
That same day, a seniorRussianofficialsaidthe country will not legalize libra because it could threaten the nation’s financial system.
• FATF to Strengthen Control Over Crypto Exchanges to Prevent Money Laundering
• Facebook Has Not Applied for RBI Approval to Operate Libra in India: Report
• US Fed Chair: Facebook's Libra Carries Both Benefits and Risks
• Russia Will Not Legalize Facebook’s Cryptocurrency, Official Says |
Do Directors Own KDA Group Inc. (CVE:KDA) Shares?
Want to participate in ashort 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 KDA Group Inc. (CVE:KDA), 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 quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'
KDA Group is not a large company by global standards. It has a market capitalization of CA$18m, which means it wouldn't have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions are not on the share registry. Let's delve deeper into each type of owner, to discover more about KDA.
Check out our latest analysis for KDA Group
We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.
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. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of KDA Group, for yourself, below.
Hedge funds don't have many shares in KDA Group. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
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 KDA Group Inc.. It has a market capitalization of just CA$18m, and insiders have CA$3.2m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checkingif those insiders have been buying recently.
The general public -- mostly retail investors -- own 57% of KDA Group . With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.
We can see that Private Companies own 25%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
It's always worth thinking about the different groups who own shares in a company. But to understand KDA Group better, we need to consider many other factors.
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 course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist 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 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. |
Ex-Barclays CEO Varley cleared of fraud charges
By Iain Withers and Kirstin Ridley
LONDON (Reuters) - Former Barclays CEO John Varley was acquitted of fraud charges on Friday after senior judges said there was insufficient evidence against him in a case about Qatari cash injections that saved the bank from a state bailout in 2008.
The case, pursued by Britain's Serious Fraud Office (SFO), was the first time the head of a global bank has faced criminal charges over conduct during the financial crisis, when the banking system was brought to its knees and taxpayers were forced to pay billions of pounds to shore it up.
SFO prosecutors had charged Varley with two counts of conspiracy to commit fraud by false representation, alleging he plotted to pay Qatar secret fees to help rescue Barclays, one of the few major British banks to survive the credit crisis without direct government aid.
But judges at the Court of Appeal in London agreed with a lower court's ruling that the SFO's evidence against Varley, who had denied wrongdoing, was insufficient to proceed with the case.
Three other former Barclays executives charged alongside Varley are to be retried at a date yet to be determined.
Prosecutors alleged the four men misled shareholders and other investors by not disclosing that the bank paid an extra 322 million pounds to Qatar during a two-part 11 billion pound ($14 billion) emergency fundraising in June and October 2008.
Roger Jenkins, the former Barclays chairman of investment management in the Middle East, ex-wealth management head Tom Kalaris and Richard Boath, who headed the corporate finance business, also deny any wrongdoing.
The case is seen as a major test of the SFO, which has been investigating the events leading up to Qatar's investment since 2012, and has faced criticism over its difficulties in holding senior bankers to account.
The taxpayer-funded investigator and prosecutor won praise from some politicians and lawyers in 2017 for filing criminal fraud charges against Barclays itself and the senior executives after a five-year investigation.
But Varley's acquittal follows a separate court decision to also dismiss the charges against the bank in 2018.
Varley, an Oxford-educated former lawyer, stood down as Barclays CEO in 2011 and has spent most of the years since embroiled in the SFO probe.
He joined the bank in 1982, and after 12 years in investment banking, going on to head its asset management division and retail banking.
He became finance director in 2000 and was promoted to CEO in 2004. He stood down in 2011 when investment banker Bob Diamond took over.
($1 = 0.7906 pounds)
(Reporting by Iain Withers; Writing by Kirstin Ridley and Rachel Armstrong; Editing by Alexander Smith and Mark Potter) |
Ex-Barclays CEO acquitted in criminal case over 2008 bailout
Former Barclays' CEO John Varley arrives at Southwark Crown Court in London, Britain, January 23, 2019. Photo: REUTERS/Hannah McKay The former CEO of Barclays ( BARC.L ) has been acquitted in a criminal case against him related to a bailout of the bank by Qatar at the height of the financial crisis. John Varley was cleared by the appeal court on Friday. Trial judge Justice Jay ruled that the evidence against Varley on the two counts he faced was insufficient for the case to proceed. An appeal against that ruling was dismissed and Varley was acquitted of the charges. Varley was one of four former Barclays executives accused of fraud charges related to a multi-billion-pound investment in the bank by Qatar made at the height of the financial crisis. The UK’s Serious Fraud Office (SFO) alleged that the four bankers misled the stock market by not fully disclosing fees paid to Qatar. The defendants in the case were: John Varley, who was CEO of Barclays between 2004 and 2011; Roger Jenkins, who ran Barclays Capital’s investment management business in the Middle East and North Africa; Thomas Kalaris, the former CEO of Barclays’ wealth and investment management; and Richard Boath, the former head of the European financial institutions group at Barclays Capital. The other three defendants in the case will be retried at a date to be determined. Qatar’s sovereign wealth fund and a company connected to the Middle Eastern country’s ruling family invested £4.4bn ($5.7bn) in Barclays across two capital raises in 2008, as part of a total of £11.8bn raised by the bank. The investment helped save Barclays from a state bailout at the height of the financial crisis. The Qataris were paid £322m in fees, equivalent to 3.25% of their investment. This was more than the commission paid to other investors in the funding round and the SFO alleged that the accused conspired to hide the true nature of the fees. Read more on the case: Former Barclays execs lied about payments to Qatar, court told Senior Barclays banker raised concerns about ‘hidden commission’ in Qatar deal, court told Ex-Barclays exec said ‘none of us wants to go to jail’ over Qatar deal, jury hears: ‘The food sucks and the sex is worse’ Barclays bankers feared being ‘rumbled’ in ‘dangerous’ Qatar transaction, jury hears: ‘If you go down the whole place goes down’ Barclays bankers worried about ‘dodgy’ payments to Qatari Prime Minister, court hears Bankers feared pay cuts if state had nationalised Barclays in 2008, court hears ‘Big dog’ Barclays banker paid £25m bonus for 2008 funding deal at the heart of court case Barclays lawyers signed off on ‘bungs’ and ‘corrupt payments’ to Qataris, court told Judge tells jury not to 'dwell on soundbites' about 'the food and the sex' in Barclay trial Jury discharged in 'Barclays Four' case |
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