text stringlengths 1 675k ⌀ |
|---|
How Financially Strong Is Ebiquity plc (LON:EBQ)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Investors are always looking for growth in small-cap stocks like Ebiquity plc (LON:EBQ), with a market cap of UK£39m. However, an important fact which most ignore is: how financially healthy is the business? Given that EBQ is not presently profitable, it’s crucial to assess the current state of its operations and pathway to profitability. We'll look at some basic checks that can form a snapshot the company’s financial strength. Nevertheless, this is just a partial view of the stock, and I recommend youdig deeper yourself into EBQ here.
EBQ has built up its total debt levels in the last twelve months, from UK£34m to UK£36m , which includes long-term debt. With this rise in debt, the current cash and short-term investment levels stands at UK£8.8m to keep the business going. Additionally, EBQ has produced cash from operations of UK£4.6m in the last twelve months, resulting in an operating cash to total debt ratio of 13%, signalling that EBQ’s current level of operating cash is not high enough to cover debt.
At the current liabilities level of UK£28m, it seems that the business has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.39x. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for Media 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.
With debt reaching 76% of equity, EBQ may be thought of as relatively highly levered. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. However, since EBQ is presently loss-making, there’s a question of sustainability of its current operations. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns.
EBQ’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 EBQ'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 EBQ has company-specific issues impacting its capital structure decisions. You should continue to research Ebiquity to get a more holistic view of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for EBQ’s future growth? Take a look at ourfree research report of analyst consensusfor EBQ’s outlook.
2. Valuation: What is EBQ 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 EBQ 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. |
Is Ebiquity plc (LON:EBQ) A Financially Sound Company?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! While small-cap stocks, such as Ebiquity plc ( LON:EBQ ) with its market cap of UK£39m, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Since EBQ is loss-making right now, it’s essential to understand 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. Nevertheless, these checks don't give you a full picture, so I suggest you dig deeper yourself into EBQ here . EBQ’s Debt (And Cash Flows) EBQ's debt levels surged from UK£34m to UK£36m over the last 12 months – this includes long-term debt. With this increase in debt, EBQ currently has UK£8.8m remaining in cash and short-term investments to keep the business going. Moreover, EBQ has produced cash from operations of UK£4.6m in the last twelve months, resulting in an operating cash to total debt ratio of 13%, signalling that EBQ’s debt is not covered by operating cash. Does EBQ’s liquid assets cover its short-term commitments? With current liabilities at UK£28m, it appears that the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.39x. The current ratio is calculated by dividing current assets by current liabilities. For Media companies, this ratio is within a sensible range since there is a bit of a cash buffer without leaving too much capital in a low-return environment. AIM:EBQ Historical Debt, June 24th 2019 Does EBQ face the risk of succumbing to its debt-load? With debt reaching 76% of equity, EBQ may be thought of as relatively highly levered. 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 EBQ is presently loss-making, there’s a question of sustainability of its current operations. 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: Although EBQ’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. Since there is also no concerns around EBQ's liquidity needs, this may be its optimal capital structure for the time being. I admit this is a fairly basic analysis for EBQ's financial health. Other important fundamentals need to be considered alongside. I suggest you continue to research Ebiquity to get a better picture of the small-cap by looking at: Future Outlook : What are well-informed industry analysts predicting for EBQ’s future growth? Take a look at our free research report of analyst consensus for EBQ’s outlook. Valuation : What is EBQ 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 EBQ 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. |
Should You Be Pleased About The CEO Pay At Vertu Motors plc's (LON:VTU)
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Robert Forrester is the CEO of Vertu Motors plc (LON:VTU). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. The aim of all this is to consider the appropriateness of CEO pay levels.
See our latest analysis for Vertu Motors
At the time of writing our data says that Vertu Motors plc has a market cap of UK£147m, and is paying total annual CEO compensation of UK£616k. (This number is for the twelve months until February 2019). We think total compensation is more important but we note that the CEO salary is lower, at UK£315k. We examined companies with market caps from UK£79m to UK£315m, and discovered that the median CEO total compensation of that group was UK£538k.
So Robert Forrester receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Vertu Motors has changed from year to year.
Vertu Motors plc has reduced its earnings per share by an average of 5.2% a year, over the last three years (measured with a line of best fit). Its revenue is up 6.7% over last year.
Few shareholders would be pleased to read that earnings per share are lower over three years. The modest increase in revenue in the last year isn't enough to make me overlook the disappointing change in earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Since shareholders would have lost about 8.8% over three years, some Vertu Motors plc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously.
Robert Forrester is paid around the same as most CEOs of similar size companies.
After looking at EPS and total shareholder returns, it's certainly hard to argue the company has performed well, since both metrics are down. Suffice it to say, we don't think the CEO is underpaid! If you think CEO compensation levels are interesting you will probably really likethis free visualization of insider trading at Vertu Motors.
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. |
Should You Worry About Vertu Motors plc's (LON:VTU) CEO Salary Level?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Robert Forrester is the CEO of Vertu Motors plc (LON:VTU). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
Check out our latest analysis for Vertu Motors
According to our data, Vertu Motors plc has a market capitalization of UK£147m, and pays its CEO total annual compensation worth UK£616k. (This is based on the year to February 2019). While we always look at total compensation first, we note that the salary component is less, at UK£315k. We examined companies with market caps from UK£79m to UK£315m, and discovered that the median CEO total compensation of that group was UK£538k.
So Robert Forrester is paid around the average of the companies we looked at. Although this fact alone doesn't tell us a great deal, it becomes more relevant when considered against the business performance.
The graphic below shows how CEO compensation at Vertu Motors has changed from year to year.
Over the last three years Vertu Motors plc has shrunk its earnings per share by an average of 5.2% per year (measured with a line of best fit). Its revenue is up 6.7% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. The fairly low revenue growth fails to impress given that the earnings per share is down. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Shareholders might be interested inthisfreevisualization of analyst forecasts.
Given the total loss of 8.8% over three years, many shareholders in Vertu Motors plc are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
Remuneration for Robert Forrester is close enough to the median pay for a CEO of a similar sized company .
Returns have been disappointing and the company is not growing its earnings per share. Most would consider it prudent for the company to hold off any CEO pay rise until performance improves. So you may want tocheck if insiders are buying Vertu Motors shares with their own money (free access).
If you want to buy a stock that is better than Vertu Motors, thisfreelist of high return, low debt companies is a great place to look.
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 Vivo Energy plc (LON:VVO) Be Part Of Your Dividend Portfolio?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Could Vivo Energy plc (LON:VVO) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments.
Vivo Energy has only been paying a dividend for a year or so, so investors might be curious about its 1.5% yield. Some simple research can reduce the risk of buying Vivo Energy for its dividend - read on to learn more.
Explore this interactive chart for our latest analysis on Vivo Energy!
Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Looking at the data, we can see that 17% of Vivo Energy's profits were paid out as dividends in the last 12 months. We'd say its dividends are thoroughly covered by earnings.
In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. Vivo Energy paid out 8.1% of its free cash flow as dividends last year, which is conservative and suggests the dividend is sustainable. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.
Consider gettingour latest analysis on Vivo Energy's financial position here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. With a payment history of less than 2 years, we think it's a bit too soon to think about living on the income from its dividend. During the past one-year period, the first annual payment was US$0.013 in 2018, compared to US$0.025 last year. Dividends per share have grown at approximately 88% per year over this time.
Vivo Energy has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.
Examining whether the dividend is affordable and stable is important. However, it's also important to assess if earnings per share (EPS) are growing. Over the long term, dividends need to grow at or above the rate of inflation, in order to maintain the recipient's purchasing power. It's not great to see that Vivo Energy's have fallen at approximately 66% over the past three years. Declining earnings per share over a number of years is not a great sign for the dividend investor. Without some improvement, this does not bode well for the long term value of a company's dividend.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Firstly, we like that Vivo Energy has low and conservative payout ratios. Earnings per share are down, and to our mind Vivo Energy has not been paying a dividend long enough to demonstrate its resilience across economic cycles. In sum, we find it hard to get excited about Vivo Energy from a dividend perspective. It's not that we think it's a bad business; just that there are other companies that perform better on these criteria.
Given that earnings are not growing, the dividend does not look nearly so attractive. Businesses can change though, and we think it would make sense to see whatanalysts are forecasting for the company.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Bank for International Settlements warns: Facebook’s Libra crypto project could pose risks to banks
The Bank for International Settlements (BIS), considered to be the central bank of central banks, has warned that Facebook's planned cryptocurrency project, Libra, could harm the banking sector.
The BISpublisheda report on Sunday, saying that big tech companies such as Facebook, Amazon and Google could "rapidly establish a dominant position," thanks to their extensive network of users. While these companies can enhance financial inclusion, they could also present threats to financial stability, competition and data protection, the BIS said.
Regulators around the world, therefore, would need to coordinate to ensure "a level playing field between big techs and banks." They would also need to take a "more comprehensive" approach that draws on financial regulation, competition policy and data privacy regulations, the BIS said, adding:
"The aim should be to respond to big techs' entry into financial services so as to benefit from the gains while limiting the risks. As the operations of big techs straddle regulatory perimeters and geographical borders, coordination among authorities - national and international - is crucial."
Facebook, along with 27 founding partners,unveileda plan for a "low-volatility" cryptocurrency called Libra last week, intending to serve the unbanked and facilitate low-fee money transfers globally. Libra 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. |
Do Insiders Own Shares In Wise Group AB (publ) (STO:WISE)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
The big shareholder groups in Wise Group AB (publ) (STO:WISE) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in 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.'
Wise Group is not a large company by global standards. It has a market capitalization of kr370m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions don't own many shares in the company. Let's delve deeper into each type of owner, to discover more about WISE.
See our latest analysis for Wise Group
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Institutions own less than 5% of Wise Group. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.
Hedge funds don't have many shares in Wise Group. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our most recent data indicates that insiders own the majority of Wise Group AB (publ). This means they can collectively make decisions for the company. Given it has a market cap of kr370m, that means they have kr208m worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You canclick here to see if those insiders have been buying or selling.
With a 40% ownership, the general public have some degree of sway over WISE. 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 Wise 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 coursethis may not be the best stock to buy. So take a peek at thisfreefreelist 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. |
The Iran, the U.S and the Rest of Middle East
Europe, Asia, and the Middle East will be balking at the threat of U.S military action against Iran.
With the threat of ISIS having been largely quashed, does the world really need the rise of a new enemy?
Since the Iran – Iraq war, Iran’s power and influence within the Middle East have grown significantly. Fragmentation, largely driven by Western influence ultimately gave Iran the opportunity to strengthen.
U.S President Trump had talked about withdrawing the U.S from the Nuclear agreement and delivered as promised.
The trade war stick has been wagged at a number of regions and countries since, including the EU. For Iran, however, it’s the U.S that is the bone of contention and not the EU, who has continued to recognize the agreement.
It will give the EU an easy get out from the agreement should the Iranian government begin to breach any of the conditions, however.
Few believe that Iran would actually go to war against the U.S. With the Saudis and Israeli’s waiting patiently for the U.S to reverse Iran’s rise to prominence, the pressure will be mounting on Trump.
Late last week, the news wires revealed that Trump had been prepared to take military action, following the downing of a U.S drone.
The decision to hold back suggests that even the U.S President is not so eager to start an offensive that could get messy.
With the Iranian economy already in dire straits, fresh sanctions are going to push the Iranian government to respond.
The hard-line clerics will be looking to show their will, which suggests that tensions will build further. That leaves the U.S and Nato to thrash it out. Contravening the nuclear agreement would certainly give NATO reason to support any U.S military strike.
News of the U.S reaching out to Iran has so far failed to ease market jitters over what lies ahead.
Trump and the U.S Secretary of State both spoke over the weekend, stating that the U.S is not looking for war.
With the G20 Summit at the end of the week and oil prices on the rise, Trump’s push for cheap oil prices will continue to fail should tensions remain high.
Ultimately, Trump wants a renegotiation of the current nuclear agreement. It may be that only the U.S will be willing to compromise at the 2nd time of asking.
Iran, however, will unlikely to be willing to compromise. The current nuclear agreement was already a step too far in the eyes of the more hard-line clerics…
WTI and Brent ended last week up by 9.37% and by 5.39% respectively. Not a bad bounce back, when considering rising inventories and falling demand, not to mention the negative economic outlooks.
Military action of some sort is going to need to materialize, however, for crude to continue to find support. Even then, the Saudis may need to agree with the U.S administration to curb production.
This could all blow over, but that would need one side to back down. We’ve seen how the U.S administration digs in and we’ve seen how Iran digs in…
There’s been no mad rush for U.S Treasuries or for the Japanese Yen for that matter. That could change in a matter of hours…
Thisarticlewas originally posted on FX Empire
• AUD/USD Forex Technical Analysis – June 25, 2019 Forecast
• Gold Goes Boom as High Trend Resistance is Bulldozed by Bulls
• S&P 500 Pulling Back From New Record, Reversal? The U.S. Stock Market In
• GBP/NZD Needs to Break 1.9159 for Bearish Continuation
• Natural Gas Price Fundamental Daily Forecast – Heat in Forecast, but Will It Last?
• Gold Above $1,400 is Only the Tip of the Signal Iceberg |
What Percentage Of Wise Group AB (publ) (STO:WISE) Shares Do Insiders Own?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
The big shareholder groups in Wise Group AB (publ) (STO:WISE) have power over the company. 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.'
Wise Group is not a large company by global standards. It has a market capitalization of kr370m, 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 don't own many shares in the company. We can zoom in on the different ownership groups, to learn more about WISE.
View our latest analysis for Wise Group
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.
Institutions own less than 5% of Wise Group. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.
Wise Group is not owned by hedge funds. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 that insiders own more than half the Wise Group AB (publ) stock. This gives them a lot of power. So they have a kr208m stake in this kr370m business. It is good to see this level of investment. You cancheck here to see if those insiders have been buying recently.
With a 40% ownership, the general public have some degree of sway over WISE. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I always like to check for ahistory of revenue growth. You can too, by accessing this free chart ofhistoric revenue and earnings in thisdetailed graph.
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. |
Is Veracruz Properties SOCIMI, S.A.'s (BME:YVCP) Balance Sheet Strong Enough To Weather A Storm?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Veracruz Properties SOCIMI, S.A. (BME:YVCP) is a small-cap stock with a market capitalization of €750k. 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? Understanding the company's financial health becomes essential, since poor capital management may bring about bankruptcies, which occur at a higher rate for small-caps. The following basic checks can help you get a picture of the company's balance sheet strength. Nevertheless, these checks don't give you a full picture, so I recommend youdig deeper yourself into YVCP here.
YVCP has built up its total debt levels in the last twelve months, from €30m to €32m , which accounts for long term debt. With this rise in debt, the current cash and short-term investment levels stands at €2.0m to keep the business going. Moreover, YVCP has produced €3.3m in operating cash flow in the last twelve months, leading to an operating cash to total debt ratio of 10%, meaning that YVCP’s operating cash is less than its debt.
Looking at YVCP’s €3.4m in current liabilities, the company may not have an easy time meeting these commitments with a current assets level of €2.8m, leading to a current ratio of 0.82x. The current ratio is the number you get when you divide current assets by current liabilities.
With debt reaching 78% of equity, YVCP may be thought of as relatively highly levered. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. We can check to see whether YVCP 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 YVCP's, case, the ratio of 4.96x suggests that interest is appropriately covered, which means that lenders may be inclined to lend more money to the company, as it is seen as safe in terms of payback.
YVCP’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. However, 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 YVCP has company-specific issues impacting its capital structure decisions. You should continue to research Veracruz Properties SOCIMI to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for YVCP’s future growth? Take a look at ourfree research report of analyst consensusfor YVCP’s outlook.
2. Valuation: What is YVCP 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 YVCP 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. |
What You Should Know About Veracruz Properties SOCIMI, S.A.'s (BME:YVCP) Financial Strength
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Veracruz Properties SOCIMI, S.A. (BME:YVCP) is a small-cap stock with a market capitalization of €750k. 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? Assessing first and foremost the financial health is vital, as mismanagement of capital can lead to bankruptcies, which occur at a higher rate for small-caps. Let's work through some financial health checks you may wish to consider if you're interested in this stock. However, these checks don't give you a full picture, so I’d encourage you todig deeper yourself into YVCP here.
YVCP's debt levels surged from €30m to €32m over the last 12 months , which includes long-term debt. With this rise in debt, YVCP's cash and short-term investments stands at €2.0m to keep the business going. On top of this, YVCP has produced cash from operations of €3.3m during the same period of time, resulting in an operating cash to total debt ratio of 10%, indicating that YVCP’s operating cash is less than its debt.
With current liabilities at €3.4m, the company may not have an easy time meeting these commitments with a current assets level of €2.8m, leading to a current ratio of 0.82x. The current ratio is the number you get when you divide current assets by current liabilities.
With debt reaching 78% of equity, YVCP may be thought of as relatively highly levered. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. We can check to see whether YVCP 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 YVCP's, case, the ratio of 4.96x suggests that interest is appropriately covered, which means that lenders may be willing to lend out more funding as YVCP’s high interest coverage is seen as responsible and safe practice.
YVCP’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. However, 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 YVCP has company-specific issues impacting its capital structure decisions. I suggest you continue to research Veracruz Properties SOCIMI to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for YVCP’s future growth? Take a look at ourfree research report of analyst consensusfor YVCP’s outlook.
2. Valuation: What is YVCP 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 YVCP 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. |
Where C&C Group plc's (ISE:GCC) Earnings Growth Stands Against Its Industry
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Measuring C&C Group plc's (ISE:GCC) track record of past performance is a valuable exercise for investors. It allows 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 GCC's recent performance announced on 28 February 2019 and compare these figures to its historical trend and industry movements.
Check out our latest analysis for C&C Group
GCC's trailing twelve-month earnings (from 28 February 2019) of €72m has declined by -9.2% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 8.8%, indicating the rate at which GCC is growing has slowed down. What could be happening here? Well, let’s take a look at what’s transpiring with margins and whether the rest of the industry is experiencing the hit as well.
In terms of returns from investment, C&C Group has fallen short of achieving a 20% return on equity (ROE), recording 12% instead. However, its return on assets (ROA) of 5.9% exceeds the IE Beverage industry of 5.5%, indicating C&C Group has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for C&C Group’s debt level, has increased over the past 3 years from 9.5% to 10%.
C&C Group'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 capricious earnings, can have many factors impacting its business. You should continue to research C&C Group to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for GCC’s future growth? Take a look at ourfree research report of analyst consensusfor GCC’s outlook.
2. Financial Health: Are GCC’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 28 February 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
EXPLAINER: Money talks in Trump's Mideast plan. But can it pave way for peace?
By Stephen Farrell
JERUSALEM, June 24 (Reuters) - More than two years after U.S. President Donald Trump first proposed a plan to revive the Israeli-Palestinian peace process, its first phase will be formally unveiled on Tuesday at an economic workshop in Bahrain.
The ‘Peace to Prosperity’ economic summit to encourage investment in the Palestinian Territories was billed as the first part of the White House’s broader political plan to end the conflict.
Trump's son-in-law Jared Kushner, the plan’s main architect, gave Reuters an exclusive preview of the economic proposals on Saturday.
But the White House’s economic prospectus makes no mention of Palestinian statehood. And little has so far been revealed about the later political stage of the plan, which will have to address this and other issues that have defied decades of efforts by previous peacemakers.
These issues include:
-The status of Jerusalem – which includes sites sacred to Judaism, Islam and Christianity
-Establishing mutually agreed borders.
-Finding security arrangements to satisfy Israel’s fears of attacks by Palestinians and hostile neighbors.
-Addressing Palestinians demands for statehood, and an end to Israel’s decades-old occupation of the Palestinian Territories.
-Finding a solution to the plight of millions of Palestinian refugees.
-Arrangements to share scarce natural resources, such as water.
-Palestinian demands that Israel remove settlements in which more than 400,000 Israelis now live among roughly 3 million Palestinians in the West Bank, with another 200,000 settlers in East Jerusalem.
What do we know about the plan?
The ‘Peace to Prosperity’ workshop in Manama will take an “economy first” approach to a political and religious conflict.
This reflects either a refreshingly pragmatic approach, or the business roots of its New York architects, depending on whether you talk to supporters or critics.
It calls for a $50 billion investment fund to boost the Palestinian and neighboring Arab state economies, according to documents reviewed by Reuters.
Among the 179 proposed infrastructure and business projects is a $5 billion transportation corridor to connect the West Bank and Gaza.
More than half of the $50 billion would be spent in the Palestinian territories over 10 years.
The rest would be divided between neighboring Lebanon, Egypt - whose Sinai peninsula adjoins Gaza - and Jordan, the country which has absorbed more Palestinians than any other, and fears anything that might lead to their permanent settlement there.
Who will pay?
The Trump administration hopes that others - principally wealthy Gulf states and private investors - will foot much of the bill.
What are its chances?
Expectations are low – there will be nobody from the Israeli or Palestinian governments at a workshop devoted to promoting peace between Israelis and Palestinians.
And the economic revival plan would be implemented only if a political solution to one of the world’s most intractable conflicts is reached.
The last peace talks collapsed in 2014, but hopes were low even then after two Palestinian uprisings in the last three decades, Israeli settlement expansion and the rise to power of Hamas – an armed Islamist movement that remains implacably opposed to Israel’s existence.
What’s new?
Kushner and Trump’s Middle East envoy Jason Greenblatt are seeking a deal that could unlock prosperity for the Palestinians and security for Israel.
But some of the economic proposals have been floated before – such as the transportation corridor linking Gaza and the West Bank – and stalled for lack of underlying political or security agreements.
The elephant in the room is whether the Trump administration’s talk of a new approach is code for an abandonment of the two-state solution - the long-standing international formula to bring about peace by creating an independent Palestinian state living side-by-side with Israel.
The United Nations and most nations around the world back the two-state solution and it has underpinned every peace plan for decades. But the Trump team has consistently refused to commit to it.
What are the Israelis saying?
Israeli Prime Minister Benjamin Netanyahu said he would listen to the U.S. plan, but restated his long-held position that his country must retain a presence in the Jordan Valley, the strategic and fertile easternmost strip of the Israeli-occupied West Bank that borders Jordan.
"We'll hear the American proposition, hear it fairly and with openness. And I cannot understand how the Palestinians, before they even heard the plan, reject it outright," Netanyahu said on Sunday.
"Under any peace agreement our position will be that Israel's presence should continue here, for Israel's security and for the security of all," he said. Palestinians say that the Jordan Valley, nearly 30 per cent of the West Bank, would be a vital part of their future state, as the breadbasket of the West Bank and its external border with Jordan.
What are the Palestinians saying?
President Mahmoud Abbas’s Palestinian Authority and Palestine Liberation Organization have refused to deal with the Trump administration for 18 months, accusing it of bias toward Israel. They are boycotting Bahrain and on Sunday, Abbas said that solely economic solutions were a non-starter.
"Money is important. The economy is important. But politics are more important. The political solution is more important," he said.
"We welcome all those who wish to help us, whether it be in Manama or anywhere else. But for now, we reject the deal of the century."
"What have the Americans proposed that is original? 50 or 60 billion dollars? We are used to this kind of nonsense. Let’s not lie to each other. We’ll see if anyone lives long enough to see that $50 billion or $60 billion come."
Ismail Rudwan, a spokesman for Hamas, said: “Palestine isn’t for sale”.
What are others saying?
Nathan Thrall, Director of the Israel/Palestine Project, International Crisis Group:
“It doesn’t stand a chance because the Palestinians won’t even attend, and the Arab states have very limited room for maneuver in terms of how much they can betray the Palestinians on the core issues.
"They are betraying the Palestinians just in the very fact of their growing closeness to Israel, but to betray the Palestinians on something like the Arab position on Jerusalem or on refugees, that is something that, at least in 2019, is still unthinkable.”
Abdulrahman al-Rashed, former general manager of Al Arabiya TV:
“Many will say "It's NOT the economy, stupid", those against will demand a political solution based on establishing a Palestinian state. However, I believe economy is important and we were never short of political solutions. Building roads and bridges will bridge political differences."
Aaron David Miller, former Middle East negotiator for U.S. Republican and Democratic administrations:
“I can't tell you how many times while working on the Arab-Israeli negotiations over the course of a 20-year period, I've had Middle East proposals for Middle East "Marshall plans" cross my desk. The reality is that both in sequence and in scope it's very problematic to use economic incentives - development, trade, assistance, even institution-building, without first obviously addressing the core political needs and requirements of peoples in conflict.”
Lebanon’s parliament speaker Nabih Berri:
“The only investment that will not find fertile ground in Lebanon is any investment that comes at the expense of the Palestinian cause and the right of return... Mr. Kushner, the Lebanese will not be partners in selling Palestine.”
Jared Kushner, White House senior adviser:
"There’ll be praise from some places, there’ll be criticism from some places, hopefully it will be constructive. I always prefer having people share what they’re for as opposed to what they’re against and if people have constructive criticism, we’ll welcome it and we’ll try and make modifications but the hope is that we can bring all of the different people together from Europe, from Asia, from the Middle East, and agree this would be a good path forward if we’re able to resolve the political issues.”
Is now a good time?
The timing is certainly complicated.
Official U.S.- Israeli relations are at a zenith, with Trump and Netanyahu the closest of allies.
But U.S.-Palestinian relations are close to an all-time nadir after Trump’s 2017 decisions to recognise Jerusalem as the capital of Israel and move the U.S. Embassy from Tel Aviv to Jerusalem.
Abbas has said Washington could no longer be regarded as an honest broker in any peace talks with Israel.
The Middle East is preoccupied by events in the Gulf, amid fears that tensions between the U.S. and its Sunni Arab allies on one side and Shi’ite Iran on the other could escalate into hostilities likely to threaten oil revenues and regional stability.
And both Trump and Netanyahu face election campaigns – Trump for re-election, and Netanyahu because he failed to put together a governing coalition in an election in April.
Why Bahrain?
With Israel, the West Bank and Gaza out of the question for political and security reasons, the Trump administration needed a safe space somewhere in the region.
Bahrain is a U.S. ally, can host a major event, and is home to the U.S. Navy’s Fifth Fleet.
The Four Seasons hotel, where the two-day event will be held lies on an island connected to the mainland by only one bridge. This allows the authorities to control security in an island state that has seen political unrest for years.
When will the political plan be revealed?
Nobody knows for sure, and the Trump team hasn’t committed to a date.
Greenblatt said it could be delayed until November because Israel is headed for an election in September – its second in six months.
Kushner told Reuters: “Our thought was that it was better to put the economic plan first. It’s less controversial. Let’s let people study it, give feedback.”
While its precise outlines have yet to be revealed, Palestinian and Arab sources who have been briefed on the draft political plan, fear that it seeks to bribe Palestinians into accepting Israeli occupation of the West Bank, a prelude to Israel annexing about half the territory and leaving them with scattered cantons.
Who is going to Bahrain?
U.S. Treasury Secretary Steven Mnuchin will be the highest-ranking member of the American delegation, which will also include Kushner and Greenblatt.
Israel is expected to send a business delegation but no government officials.
Jordan and Egypt both said they will attend, but not at a senior level. Each is sending a deputy finance minister. As the only Arab states to have reached peace agreements with Israel, it was important for the Americans to have them present.
A senior Trump administration official said that China had still not confirmed whether it would send a representative, but that Kirill Dmitriev, the head of Russia’s sovereign wealth fund was planning to attend.
However the Foreign Ministry in Moscow has been critical of the workshop, issuing a statement last month that it was “unacceptable to divert the Middle East peace process from the international legal framework.”
The International Monetary Fund, the European Bank for Reconstruction and Development and the World Bank said they planned to take part.
Most Gulf states have not confirmed who they are sending. The United Arab Emirates and Saudi Arabia plan to attend, but assured the Palestinians they would not endorse a plan that fails to meet their main demands.
The Saudi team will include economy minister Mohammed al-Tuwaijri and sovereign wealth fund Public Investment Fund (PIF) chairman Yasir al-Rumayyan. The PIF has not been asked to commit any money, according to a source familiar with the plan.
Kuwaiti media have said that Kuwait would be represented on a technical, and not political level, most likely a finance ministry official.
U.S. officials said Morocco will attend, but it has not confirmed. Foreign minister Nasser Bourita said Morocco remains attached to a two-state solution that guarantees the setting up of an independent Palestinian state with Jerusalem as its capital.
The United Nations is sending Jamie McGoldrick, the U.N. humanitarian coordinator in the Gaza Strip, West Bank and East Jerusalem. But on the same day that Bahrain opens, the U.N. agency UNRWA, which deals with Palestinian refugees, holds its annual pledging conference in New York. The U.S. has cut all funding to UNRWA.
Who isn’t going?
Palestinian political leaders have said they will stay away. Many Palestinian business leaders have also said they will boycott.
One exception is Ashraf Jabari, from Hebron, who has close ties to Israeli settler groups. A U.S. official told Reuters that at least 15 Palestinians were expected to attend.
Lebanon and Iraq are not attending.
(Writing by Stephen Farrell. Additional reporting by Dan Williams, Maayan Lubell and Jeffrey Heller in Jerusalem, Nidal al-Mughrabi in Gaza, Rami Ayyub in Ramallah, Aziz El Yaakoubi, Lisa Barrington, Saeed Azhar and Sylvia Westall in Dubai, Stephen Kalin in Riyadh, Sami Aboudi in Cairo, Ahmed Eljechtimi in Rabat, Matt Spetalnick in Manama, Steve Holland in Washington, Suleiman al-Khalidi in Amman, Ahmed Hagagy in Kuwait, Maria Kiselyova in Moscow. Editing by Carmel Crimmins) |
Here's What You Should Know About Gujarat Fluorochemicals Limited's (NSE:GUJFLUORO) 0.4% Dividend Yield
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Dividend paying stocks like Gujarat Fluorochemicals Limited (NSE:GUJFLUORO) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. Unfortunately, it's common for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments.
Investors might not know much about Gujarat Fluorochemicals's dividend prospects, even though it has been paying dividends for the last nine years and offers a 0.4% yield. While the yield may not look too great, the relatively long payment history is interesting. Before you buy any stock for its dividend however, you should always remember Warren Buffett's two rules: 1) Don't lose money, and 2) Remember rule #1. We'll run through some checks below to help with this.
Explore this interactive chart for our latest analysis on Gujarat Fluorochemicals!
Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Looking at the data, we can see that 15% of Gujarat Fluorochemicals's profits were paid out as dividends in the last 12 months. We'd say its dividends are thoroughly covered by earnings.
We update our data on Gujarat Fluorochemicals every 24 hours, so you can always getour latest analysis of its financial health, here.
One of the major risks of relying on dividend income, is the potential for a company to struggle financially and cut its dividend. Not only is your income cut, but the value of your investment declines as well - nasty. The first recorded dividend for Gujarat Fluorochemicals, in the last decade, was nine years ago. It's good to see that Gujarat Fluorochemicals has been paying a dividend for a number of years. However, the dividend has been cut at least once in the past, and we're concerned that what has been cut once, could be cut again. Its most recent annual dividend was ₹3.50 per share, effectively flat on its first payment nine years ago.
It's good to see some dividend growth, but the dividend has been cut at least once, and the size of the cut would eliminate most of the growth, anyway. We're not that enthused by this.
Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. Gujarat Fluorochemicals's earnings per share are up 6.4% on last year. It's good to see earnings per share rising, but one year is too short a period to get excited about. Were this trend to continue, we'd be interested. A low payout ratio and strong historical earnings growth suggests Gujarat Fluorochemicals has been effectively reinvesting in its business. We think this generally bodes well for its dividend prospects. We do note though, one year is too short a time to be drawing strong conclusions about a company's future prospects.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Firstly, we like that Gujarat Fluorochemicals has low and conservative payout ratios. Unfortunately, earnings growth has also been mediocre, and the company has cut its dividend at least once in the past. Gujarat Fluorochemicals has a number of positive attributes, but it falls slightly short of our (admittedly high) standards. Were there evidence of a strong moat or an attractive valuation, it could still be well worth a look.
Now, if you want to look closer, it would be worth checking out ourfreeresearch on Gujarat Fluorochemicalsmanagement tenure, salary, and performance.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Is Gujarat Fluorochemicals Limited (NSE:GUJFLUORO) A Smart Choice For Dividend Investors?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Dividend paying stocks like Gujarat Fluorochemicals Limited (NSE:GUJFLUORO) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. On the other hand, investors have been known to buy a stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations.
Investors might not know much about Gujarat Fluorochemicals's dividend prospects, even though it has been paying dividends for the last nine years and offers a 0.4% yield. A low yield is generally a turn-off, but if the prospects for earnings growth were strong, investors might be pleasantly surprised by the long-term results. Some simple research can reduce the risk of buying Gujarat Fluorochemicals for its dividend - read on to learn more.
Click the interactive chart for our full dividend analysis
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. In the last year, Gujarat Fluorochemicals paid out 15% of its profit as dividends. Given the low payout ratio, it is hard to envision the dividend coming under threat, barring a catastrophe.
We update our data on Gujarat Fluorochemicals every 24 hours, so you can always getour latest analysis of its financial health, here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. The first recorded dividend for Gujarat Fluorochemicals, in the last decade, was nine years ago. Although it has been paying a dividend for several years now, the dividend has been cut at least once by more than 20%, and we're cautious about the consistency of its dividend across a full economic cycle. Its most recent annual dividend was ₹3.50 per share, effectively flat on its first payment nine years ago.
Modest growth in the dividend is good to see, but we think this is offset by historical cuts to the payments. It is hard to live on a dividend income if the company's earnings are not consistent.
With a relatively unstable dividend, it's even more important to evaluate if earnings per share (EPS) are growing - it's not worth taking the risk on a dividend getting cut, unless you might be rewarded with larger dividends in future. Gujarat Fluorochemicals has grown its EPS 6.4% over the past 12 months. We're glad to see EPS up on last year, but we're conscious that growth rates typically slow as companies increase in size. A low payout ratio and strong historical earnings growth suggests Gujarat Fluorochemicals has been effectively reinvesting in its business. We think this generally bodes well for its dividend prospects. We do note though, one year is too short a time to be drawing strong conclusions about a company's future prospects.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. It's great to see that Gujarat Fluorochemicals is paying out a low percentage of its earnings and cash flow. Unfortunately, earnings growth has also been mediocre, and the company has cut its dividend at least once in the past. Overall we think Gujarat Fluorochemicals is an interesting dividend stock, although it could be better.
Are management backing themselves to deliver performance? Check their shareholdings in Gujarat Fluorochemicals inour latest insider ownership analysis.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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 Greaves Cotton Limited's (NSE:GREAVESCOT) -19% Earnings Drop Reflect A Longer Term Trend?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Understanding Greaves Cotton Limited's (NSE:GREAVESCOT) performance as a company requires examining more than earnings from one point in time. Today I will take you through a basic sense check to gain perspective on how Greaves Cotton is doing by evaluating its latest earnings with its longer term trend as well as its industry peers' performance over the same period.
View our latest analysis for Greaves Cotton
GREAVESCOT's trailing twelve-month earnings (from 31 March 2019) of ₹1.6b has declined by -19% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 9.7%, indicating the rate at which GREAVESCOT is growing has slowed down. Why is this? Well, let's look at what's going on with margins and whether the whole industry is facing the same headwind.
In terms of returns from investment, Greaves Cotton has fallen short of achieving a 20% return on equity (ROE), recording 17% instead. However, its return on assets (ROA) of 12% exceeds the IN Machinery industry of 7.7%, indicating Greaves Cotton has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Greaves Cotton’s debt level, has declined over the past 3 years from 24% to 21%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 0.009% to 1.1% over the past 5 years.
Though Greaves Cotton's past data is helpful, it is only one aspect of my investment thesis. Companies that are profitable, but have capricious earnings, can have many factors affecting its business. You should continue to research Greaves Cotton to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for GREAVESCOT’s future growth? Take a look at ourfree research report of analyst consensusfor GREAVESCOT’s outlook.
2. Financial Health: Are GREAVESCOT’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
What Kind Of Investor Owns Most Of Greene King plc (LON:GNK)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
A look at the shareholders of Greene King plc (LON:GNK) 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. We also tend to see lower insider ownership in companies that were previously publicly owned.
Greene King isn't enormous, but it's not particularly small either. It has a market capitalization of UK£1.8b, which means it would generally expect to see some institutions on the share registry. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about GNK.
View our latest analysis for Greene King
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.
Greene King already has institutions on the share registry. Indeed, they own 89% of the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Greene King's earnings history, below. Of course, the future is what really matters.
Institutional investors own over 50% of the company, so together than can probably strongly influence board decisions. Greene King is not owned by hedge funds. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 less than 1% of Greene King plc. Keep in mind that it's a big company, and the insiders own UK£1.2m worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You canclick here to see if insiders have been buying or selling.
The general public holds a 10% stake in GNK. 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.
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 findhistoric revenue and earnings in thisdetailed graph.
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. |
UPDATE 2-Turkish assets rally after opposition wins Istanbul election
(Adds quote, stocks, background)
By Ezgi Erkoyun
ISTANBUL, June 24 (Reuters) - The Turkish lira, bonds and shares gained on Monday after the opposition dealt a stinging blow to President Tayyip Erdogan by winning control of Istanbul in a re-run mayoral election on Sunday.
Turkish assets have lost value since March amid uncertainty over how the vote might affect Erdogan's economic policies and concern over strained relations between Ankara and Washington related to Turkey's purchase of Russian S-400 defence systems.
One banker said the outcome had removed a source of political uncertainty and markets were hoping the government would now shift its attention to the economic reforms that Turkey needs.
"This optimism could be limited or temporary as the S-400 issue and possible sanctions by the United States are still the most important risk element," said the banker, who requested anonymity.
Economic data on Monday also provided some encouragement. A manufacturing confidence index rose to 102.5 points in June. The capacity utilisation rate rose to 77.1%.
The lira gained to 5.72 overnight after the election outcome emerged, rallying from a close of 5.8140 on Friday. The currency stood at 5.7270 at 0743 GMT.
Ekrem Imamoglu of the Republican People's Party (CHP) secured 54.21% of votes, according to the head of the High Election Board - a bigger margin than his narrow win three months ago.
Michael Every, a senior strategist at Rabobank, said the key question is whether the government focuses on economic reform or tries to keep Imamoglu from using his mayorship to build enough momentum to challenge Erdogan in the 2023 parliamentary and presidential elections.
POSSIBLE SANCTIONS Ankara and Washington have sparred publicly for months over the S-400 missile systems, expected to be delivered to Turkey as early as next month. Washington has said that would trigger U.S. sanctions under CATSAA, a law calling for sanctions against countries procuring military equipment from Russia.
Erdogan and President Donald Trump are set to meet at a G20 summit in the Japanese city of Osaka on June 29-30, in part to discuss the S-400s and the threat of U.S. sanctions. Investors have held out hope the leaders can find a solution.
"We have a low conviction that bold reforms will be implemented after Treasury and Finance Minister Albayrak did not provide concrete details of his economic programme in April. The S-400 and F-35 issues are even more pressing," Every said.
Turkey's main BIST 100 index rose some 2% at morning trade and the banking index was up more than 3%, after election results. The two-year benchmark bond yield fell to 18.65% from 19.92% on Friday.
Turkey's dollar bonds also gained, with longer-dated bonds rising more than 1 cent to hit multi-month highs, according to Tradeweb data. (Reporting by Behiye Selin Taner; additional reporting by Karin Strohecker in London; writing by Ezgi Erkoyun; editing by Daren Butler, Larry King) |
The Matrix 4: Michael B Jordan set to replace Keanu Reeves in new Wachowskis sequel
In exciting news for fans of The Matrix , a brand new film could be coming sooner than expected. According to reports , Warner Bros is prepping a brand new entry in the sci-fi series that will be directed by the Wachowskis once again. If these reports are to be believed, Keanu Reeves will be replaced as lead by Michael B Jordan . The new Matrix film – written by Zak Penn ( The Incredible Hulk ) – is said to be going into production as early as 2020. It remains unknown whether the film will be a sequel, spinoff or a reboot. Rumours surrounding a new Matrix film began swirling when John Wick director Chad Stahelski let slip that the Wachowskis were planning a fourth film, although his comments were later claimed to be “hypothetical”. Reeves wasn’t the first choice to play Neo in the Matrix trilogy, which ended with The Matrix Revolutions in 2003: Will Smith was approached for the role and recently revealed why he turned it down . Reeves can currently be heard voicing Duke Caboom in Toy Story 4 , a character that first appeared as a blink-and-you-miss-it Easter egg in one of Pixar’s previous films. |
Is there life on Mars, or on other worlds beyond Earth? The answer may be squishy
NASA’s Curiosity rover took this selfie in June 2018 by capturing a series of pictures with a camera mounted on its robotic arm. (NASA / JPL-Caltech Photo) BELLEVUE, Wash. — NASA’s Curiosity rover has detected fresh whiffs of Martian methane , once again sparking speculation about a potential biological source — but researchers at the space agency say it’s too early to raise the alert for life on Mars. Scientists who are gathering here for the annual Astrobiology Science Conference, or AbSciCon , acknowledge that depending on the context, methane could be an indicator of biological activity , as it is on Earth. But it could just as well be of purely geological origin. “It’s not in itself a biosignature,” Abigail Allwood, a field geologist at NASA’s Jet Propulsion Laboratory, told GeekWire today during a media workshop. The belch of methane detected last week is intriguing nevertheless — in that it’s the highest level detected during Curiosity’s nearly seven years of operation on Mars. The concentration amounted to about 21 parts per billion units by volume, or three times as strong as a detection that created a scientific hubbub back in 2013. Scientists correlated that earlier spike with measurements taken from orbit by the European Space Agency’s Mars Express probe, and said the best explanation was that seismic activity triggered a release from reservoirs of methane trapped beneath Mars’ surface . NASA said Curiosity’s scientists would make further observations to gather more data about the newly reported release, and compare their results with readings taken by ESA’s Trace Gas Orbiter . That probe’s sensitive spectrometers should be able to sniff out methane in the Martian atmosphere, but it hasn’t recorded a single whiff in the past year. “Combining observations from the surface and from orbit could help scientists locate sources of the gas on the planet and understand how long it lasts in the Martian atmosphere,” NASA said today in a statement . “That might explain why the Trace Gas Orbiter’s and Curiosity’s methane observations have been so different.” Story continues Experts say they’re not likely to find a smoking gun — or, for that matter, a tribe of flatulent aliens — as they search for evidence of ancient or extant life on Mars. That caveat applies as well to ice-covered worlds with hidden oceans, such as the Jovian moon Europa and the Saturnian moon Enceladus. It’s more likely that the evidence for life beyond Earth will accumulate slowly, from multiple threads of inquiry. Those threads could include, say, the abundances of specific isotopes, or the lengths and complexity of organic molecules, or a preference for left-handedness or right-handedness in amino acids or sugars. Several scientists at the Bellevue meeting discussed the idea of creating a standard instrument suite that could detect life in a variety of settings, like the Star Trek tricorder that Spock carried. “Hopefully, a pentacorder of a heptacorder,” said Chris German, a senior scientist at the Woods Hole Oceanographic Institution. Sarah Stewart Johnson, a planetary scientist at Georgetown University, said answers to questions about extraterrestrial life won’t be 100 percent yes or no, at least af first. Rather, they’ll take on more complicated statistical forms. “We’re trying to move away from this binary ‘This Is Life / This Is Not Life’ … but really change the approach into something like ‘this is 3-sigma away from what we would expect from abiotic processes,’ ” she said. Mary Voytek, who’s in charge of NASA’s Astrobiology Program, introduced a new term — “credu-probability” — to describe the significance of a biosignature. “How credible is it, and what’s the probability that it represents life?” she said. Toward that end, astrobiologists will be unveiling the latest iteration of their “Ladder of Life Detection” assessment system this week: The “Life Detection Forum” won’t be a mathematical formula like the Drake Equation , or a rating system like the Torino Scale for asteroid threats . Instead, it’ll be a Web-based platform where astrobiologists can fine-tune their approaches to the life-detection question. “The most important aspect of this is to get real, and get rigorous,” Voytek said. Such a process should help researchers put the proper perspective on findings like last week’s methane detection — and follow the scent. “That’s the next step … figure out where it’s coming from,” Allwood said. “And if you want to, go and send a mission there. See what’s producing it.” More from GeekWire: That burst of Martian methane is long gone, but mystery of life on Mars remains NASA’s Curiosity rover tracks down organic molecules and methane on Mars Sweet! Scientists narrow down source of mysterious burst of methane on Mars Europe’s Trace Gas Orbiter sends its first color picture of Mars – and it’s spectacular |
Here's How We Evaluate Glarner Kantonalbank's (VTX:GLKBN) Dividend
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Could Glarner Kantonalbank (VTX:GLKBN) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful.
With a four-year payment history and a 3.4% yield, many investors probably find Glarner Kantonalbank intriguing. It sure looks interesting on these metrics - but there's always more to the story . Before you buy any stock for its dividend however, you should always remember Warren Buffett's two rules: 1) Don't lose money, and 2) Remember rule #1. We'll run through some checks below to help with this.
Explore this interactive chart for our latest analysis on Glarner Kantonalbank!
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Glarner Kantonalbank paid out 49% of its profit as dividends, over the trailing twelve month period. A medium payout ratio strikes a good balance between paying dividends, and keeping enough back to invest in the business. One of the risks is that management reinvests the retained capital poorly instead of paying a higher dividend.
Remember, you can always get a snapshot of Glarner Kantonalbank's latest financial position,by checking our visualisation of its financial health.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. Looking at the data, we can see that Glarner Kantonalbank has been paying a dividend for the past four years. The company has been paying a stable dividend for a few years now, but we'd like to see more evidence of consistency over a longer period. During the past four-year period, the first annual payment was CHF0.60 in 2015, compared to CHF1.00 last year. Dividends per share have grown at approximately 14% per year over this time.
Glarner Kantonalbank has been growing its dividend quite rapidly, which is exciting. However, the short payment history makes us question whether this performance will persist across a full market cycle.
Examining whether the dividend is affordable and stable is important. However, it's also important to assess if earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. Earnings have grown at around 4.8% a year for the past five years, which is better than seeing them shrink! A payout ratio below 50% leaves ample room to reinvest in the business, and provides finanical flexibility. Earnings per share growth have grown slowly, which is not great, but if the retained earnings can be reinvested effectively, future growth may be stronger.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Firstly, we like that Glarner Kantonalbank has a low and conservative payout ratio. Second, earnings growth has been ordinary, and its history of dividend payments is shorter than we'd like. In summary, we're unenthused by Glarner Kantonalbank as a dividend stock. It's not that we think it is a bad company; it simply falls short of our criteria in some key areas.
See if management have their own wealth at stake, by checking insider shareholdings inGlarner Kantonalbank stock.
We have also put together alist of global stocks with a market capitalisation above $1bn and yielding more 3%.
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. |
Evotec, Sensyne Health, The University Of Oxford, OSI, and OUI Create New Bridge Partnership 'LAB10X' In Digital Health
- LAB10X FOCUSES ON ACCELERATING DATA-DRIVEN HEALTHCARE SOLUTIONS POWERED BY ARTIFICIAL INTELLIGENCE ("AI") - GOAL IS TO ACCELERATE PROOF-OF-CONCEPT IN DIGITAL HEALTH HAMBURG, GERMANY, and OXFORD, UK / ACCESSWIRE / June 24, 2019 / Evotec SE (Frankfurt Stock Exchange: EVT, MDAX/TecDAX, ISIN: DE0005664809) today announced that it has entered into a new strategic partnership with the British clinical AI technology company Sensyne Health plc (SENS) ("Sensyne"), the University of Oxford, Oxford University Innovation Ltd ("OUI", the university's research commercialisation company), and Oxford Sciences Innovation ("OSI", the world's largest IP investment company dedicated to a single university) to fund a new BRIDGE called LAB10x. This BRIDGE is aimed at accelerating the translation of research in the fields of clinical artificial intelligence and digital health at Oxford into forming new companies applying breakthrough digital solutions, clinical AI algorithms and accelerated data-driven drug discovery and development. Under the terms of the agreement, digital health projects will be sourced exclusively from Oxford researchers via OUI and will be aided by an expert in residence seconded by Sensyne to the LAB10x initiative and embedded in the university. The technologies developed by LAB10x will be applied to generate and analyse anonymised patient datasets to improve patient outcomes and accelerate medical research and pharmaceutical R&D. The partnership brings together Sensyne's strength in clinical AI and digital health with Evotec's leading drug discovery and development expertise to leverage the world-class science at Oxford. The University of Oxford was recently ranked as world No 1 in medical science, engineering science and computer science, the three fields most relevant to the focus of LAB10x. LAB10x will be supported by a fund of approx. £ 5 m (approx. EUR 5.6 m) for an initial period of three years. Evotec will provide access to its drug discovery expertise while Sensyne will exclusively contribute its clinical AI and digital health expertise and regulated software development and data analysis environment under its Quality Management System to select projects and develop them to the point of commercial proof of concept. Story continues Evotec and Sensyne will be entitled to equity in new LAB10x spin-out companies together with Oxford University and its academic researchers. Both companies, together with OSI, will have the right to co-invest in seed financing rounds. Where company creation is not the chosen commercial path, Sensyne will have the right to acquire a license to IP generated by the selected projects. Sensyne and Evotec are also exploring other opportunities for collaboration. Dr Werner Lanthaler, Chief Executive Officer of Evotec, said: "The medicine of the future will see radical change, driven by the continuing expansion of drug discovery technologies like artificial intelligence and healthcare mega trends like digital health. Evotec and our partners will continue to invest in these areas and we are pleased to launch LAB10x with Sensyne, OSI, OUI, and the University of Oxford. Today's announcement demonstrates the power of forming public-private partnerships in drug discovery to create the next generation of medicines in an effective and efficient manner." Lord (Paul) Drayson, CEO of Sensyne Health, said : "LAB10x will leverage Sensyne's expertise in digital health and clinical AI, our regulated development environment and our unique partnership model with the University of Oxford and NHS Trusts, to ensure the science is brought through to application as quickly and efficiently as possible - delivering benefits for patients and creating significant value." Dr Matt Perkins, CEO of Oxford University Innovation, said: "Building on LAB282, the pioneering public-private drug discovery partnership model that has now been replicated around the world, LAB10x aims to combine the rapidly growing body of world class research in data-driven health innovation at Oxford with expertise, resources and an industry standard development framework for digital health innovations. Today's announcement provides a solution to a significant unmet need that has the potential to maximise the global impact of Oxford's research and expertise, leading to better healthcare technologies, disease insights, treatments and cures." Professor Gavin Screaton, Head of Medical Sciences Division, University of Oxford, said: "Digital health solutions and data-driven insights often require a multidisciplinary approach, bringing together clinicians, medical researchers, engineers and computer scientists. With world leaders in these fields, it is no surprise that Oxford University is generating a wealth of exciting innovations in this space and it is vital that this is matched by high quality translational support which increases the likelihood of future societal benefits. LAB10x has huge potential to maximise the impact of medical research and innovation in Oxford." The LAB10x name was chosen by the partners collectively to signify how critical data-driven healthcare can be accelerated from concept to innovation ten times faster, as the result of the cumulative experience of the LAB10x partners involved and by applying an agile development methodology within a regulated framework. About digital health With the rapid progress being made in artificial intelligence (AI) and digital health, there is a clear need to better understand these technologies and how they will ultimately benefit patients and the healthcare system. Digital health is the convergence of digital technologies with health, healthcare, living, and society to enhance the efficiency of healthcare delivery and make medicines more personalised. A digital therapeutic delivers evidence-based therapeutic interventions to patients that are driven by high quality software programmes to prevent, manage, or treat a medical disorder or disease. They are used independently or together with medications, devices or other therapies to optimise patient care and overall health outcomes. About Evotec's BRIDGE model: Partnering to accelerate innovation Evotec has created a new paradigm to translate early-stage academic research to drug discovery and development called "BRIDGE" (Biomedical Research, Innovation & Development Generation Efficiency), an integrated fund and award framework to tap into exciting academic science to accelerate the formation of spin-out companies and generate partnerships with Pharma and biotech. Through these efforts, Evotec has defined a new formula for fast-track early-stage drug discovery. Since the launch of the BRIDGE model in 2016, Evotec has formed and funded five partnerships, termed LAB282, LAB150, LAB591, LAB031, and LAB10x. ABOUT SENSYNE HEALTH Sensyne Health plc is a healthcare technology company that creates value from accelerating the discovery and development of new medicines and improving patient care through the analysis of real-world evidence from large databases of anonymised patient data in collaboration with NHS Trusts. These anonymised patient data are ethically sourced in that any analysis of anonymised patient data (and hence the Company's access to it) must be pre-approved for each programme on a case-by-case basis by the relevant NHS Trusts. This is to ensure that the purpose of the anonymisation and the proposed analysis are subject to appropriate ethical oversight and information governance, including conformance with NHS principles, UK data protection law and applicable regulatory guidance. Sensyne Health is an early signatory to the Department of Health and Social Care's 'Initial Code of Conduct for data-driven health and care technology'. Sensyne Health is listed on the AIM Market of the London Stock Exchange (SENS.L). Sensyne contact Sensyne Health ( WWW.SENSYNEHEALTH.COM ) +44 (0) 330 058 1845 Lord (Paul) Drayson PhD FREng, Chief Executive Officer Lorimer Headley, Chief Financial Officer Julia Wilson, Director of Investor Relations Consilium Strategic Communications +44 20 3709 5700 Mary-Jane Elliott Sukaina Virji Melissa Gardiner ABOUT THE UNIVERSITY OF OXFORD Oxford University has been placed number 1 in the Times Higher Education World University Rankings for the third year running, and at the heart of this success is our ground-breaking research and innovation. Oxford is world-famous for research excellence and home to some of the most talented people from across the globe. Our work helps the lives of millions, solving real-world problems through a huge network of partnerships and collaborations. The breadth and interdisciplinary nature of our research sparks imaginative and inventive insights and solutions. Oxford has also been ranked as the world's best institution for medical and health teaching and research by Times Higher Education for eight consecutive years. ABOUT OXFORD SCIENCES INNOVATION Oxford Sciences Innovation (OSI) is Oxford's early stage venture partner, dedicated to investing in new and emerging platforms driven by deep science and technology. OSI is guided and powered by some of the world's leading organisations, with £ 600 m raised from GV, Sequoia, Tencent, The Wellcome Trust, Temasek and several others. Since their first investment in 2015, OSI has been helping Oxford scientists address the world's leading challenges, from infectious disease to sustainable energy. ABOUT OXFORD UNIVERSITY INNOVATION Oxford University Innovation supports innovation activities across all University Divisions, managing technology transfer and consulting activities, and creating a world-leading innovation ecosystem, with Oxford University at its heart. We provide access to technology from Oxford researchers through intellectual property licensing, spinout company formation and material sales, and to academic expertise through our Consulting Services team. The New Venture Support & Funding team supports investors or donors with an interest in early-stage ventures and manages the Oxford Angels Network. Our Startup Incubator supports members and ex-members of the University who wish to start or grow entrepreneur-driven ventures that are not University spinouts. Oxford University Innovation is the highest university patent filer in the UK and is ranked 1st in the UK for university spinouts, having created over 170 new companies since 1988. Over a third of these companies have been created in the past three years. In the 2016/17 financial year we completed more than 50 licenses and consulting agreements every month. For updates on innovations from Oxford, follow Oxford University Innovation on LinkedIn and Twitter or subscribe at http://innovation.ox.ac.uk/about/contact-us/#enquiry ABOUT EVOTEC SE Evotec is a drug discovery alliance and development partnership company focused on rapidly progressing innovative product approaches with leading pharmaceutical and biotechnology companies, academics, patient advocacy groups and venture capitalists. We operate worldwide and our more than 2,600 employees provide the highest quality stand-alone and integrated drug discovery and development solutions. We cover all activities from target-to-clinic to meet the industry's need for innovation and efficiency in drug discovery and development (EVT Execute). The Company has established a unique position by assembling top-class scientific experts and integrating state-of-the-art technologies as well as substantial experience and expertise in key therapeutic areas including neuronal diseases, diabetes and complications of diabetes, pain and inflammation, oncology, infectious diseases, respiratory diseases and fibrosis. On this basis, Evotec has built a broad and deep pipeline of approx. 100 co-owned product opportunities at clinical, pre-clinical and discovery stages (EVT Innovate). Evotec has established multiple long-term alliances with partners including, Bayer, Boehringer Ingelheim, Celgene, CHDI, Novartis, Novo Nordisk, Pfizer, Sanofi, Takeda, UCB and others. For additional information please go to www.evotec.com and follow us on Twitter @Evotec . Contact Evotec AG: Gabriele Hansen, VP Corporate Communications & Investor Relations, Phone: +49.(0)40.56081-255, gabriele.hansen@evotec.com FORWARD LOOKING STATEMENTS Information set forth in this press release contains forward-looking statements, which involve a number of risks and uncertainties. The forward-looking statements contained herein represent the judgement of Evotec as of the date of this press release. Such forward-looking statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. SOURCE: Evotec SE View source version on accesswire.com: https://www.accesswire.com/549638/Evotec-Sensyne-Health-The-University-Of-Oxford-OSI-and-OUI-Create-New-Bridge-Partnership-LAB10X-In-Digital-Health |
Is Glarner Kantonalbank (VTX:GLKBN) A Smart Choice For Dividend Investors?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Dividend paying stocks like Glarner Kantonalbank (VTX:GLKBN) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments.
With a four-year payment history and a 3.4% yield, many investors probably find Glarner Kantonalbank intriguing. It sure looks interesting on these metrics - but there's always more to the story . There are a few simple ways to reduce the risks of buying Glarner Kantonalbank for its dividend, and we'll go through these below.
Click the interactive chart for our full dividend analysis
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Glarner Kantonalbank paid out 49% of its profit as dividends, over the trailing twelve month period. A medium payout ratio strikes a good balance between paying dividends, and keeping enough back to invest in the business. One of the risks is that management reinvests the retained capital poorly instead of paying a higher dividend.
Consider gettingour latest analysis on Glarner Kantonalbank's financial position here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. Glarner Kantonalbank has been paying a dividend for the past four years. The dividend has not fluctuated much, but with a relatively short payment history, we can't be sure this is sustainable across a full market cycle. During the past four-year period, the first annual payment was CHF0.60 in 2015, compared to CHF1.00 last year. This works out to be a compound annual growth rate (CAGR) of approximately 14% a year over that time.
The dividend has been growing pretty quickly, which could be enough to get us interested even though the dividend history is relatively short. Further research may be warranted.
The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Over the long term, dividends need to grow at or above the rate of inflation, in order to maintain the recipient's purchasing power. Glarner Kantonalbank has grown its earnings per share at 4.8% per annum over the past five years. Glarner Kantonalbank is paying out less than half of its earnings, which we like. Earnings per share growth have grown slowly, which is not great, but if the retained earnings can be reinvested effectively, future growth may be stronger.
Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. Firstly, we like that Glarner Kantonalbank has a low and conservative payout ratio. Unfortunately, earnings growth has also been mediocre, and we think it has not been paying dividends long enough to demonstrate resilience across economic cycles. Glarner Kantonalbank might not be a bad business, but it doesn't show all of the characteristics we look for in a dividend stock.
See if management have their own wealth at stake, by checking insider shareholdings inGlarner Kantonalbank stock.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Fed’s Bullard May Offer Insight into What It Will Take to Lower Rates in July
The Federal Reserve’s dovish tone grabbed most of the headlines last week. Based on the reactions in the Treasurys, stock market, U.S. Dollar and gold, it looks like investors were reading a crystal ball rather than the Fed’s monetary policy statement. Traders felt so strongly the Fed had sent a message that lower rates were coming that they drove the benchmark 10-year Treasury yield below 2% for the first time since late 2016, and the chances of a rate cut at its July meeting to 100%.
This was interesting because the Fed never said it was preparing to cut rates. It never gave a specific timetable for future rate cuts, but the “dot plot” projections signaled at least one cut before the end of the year. Additionally, policymakers dropped the word “patient” in their policy statement, and Fed Chair Powell acknowledged at his press conference that the case for policy easing had strengthened.
Those are the facts that investors ran with last week to drive yields and the dollar lower, and gold and stocks sharply higher.
Overlooked, however, was the importance of the vote to hold rates steady in June. Federal Open Market Committee members voted 9-to-1 to hold its benchmark short-term rate steady at last week’s meeting with St. Louis Federal Reserve President James Bullard as the sole dissenter. Investors want to know what it is going to take to get the other members on board for a rate cut as early as July 31.
This is important this week for traders because both Powell and Bullard are scheduled to speak on Tuesday. While most investors will be focused on Powell, I believe traders will gain an edge if they listen to what Bullard has to say.
Powell speaks at the Council on Foreign Relations on Tuesday. According to reports, he is expected to talk about big picture events like the broader challenges of the Fed. He’ll move the markets if he comments on what it is policymakers are looking for to determine whether they are going to cut in July or not.
Bullard, on the other hand, is scheduled to speak at a roundtable dinner organized by MNI News. Without a specific topic, Bullard will be free to talk about what data other members will be looking at when they make their interest rate decision next month.
On Friday, Bullard said he wanted to cut interest rates last week to guard against an outlook of slowing growth and weak inflation.
In a brief statement posted on his bank’s website, Bullard said that lowering interest rates this week “would provide insurance against further declines in expected inflation and a slowing economy subject to elevated downside risks.”
Bullard also said a quarter-point rate cut this week would have been the most appropriate course of action. He also cited the substantial decline in core and headline inflation, which are running about 40 to 50 basis points below the Fed’s 2% inflation target.
Furthermore, Bullard added that the drop in inflation is unlikely “transitory” which the Fed believed for several months. He further added that economic growth is expected to slow the rest of the year and uncertainties about the outlook have “recently increased.”
Finally, Bullard implied a rate cut now could act like insurance. “Even if a sharper-than-expected slowdown does not materialize, a rate cut would help promote a more rapid return of inflation and inflation expectations to target,” he said.
Fed Vice Chairman Richard Clarida, who voted against a rate cut in June, stressed that he thought the economy would continue to grow but tied rising worries to global trade tension.
“I think our outlook is for a sustained economic expansion. We could see some moderation in growth this year, but the economy’s baseline outlook is good: sustained growth, a strong labor market and inflation near our objective,” he said.
Clarida also said, “We have the tools necessary to sustain expansion, a strong labor market and stable prices and as appropriate we will deploy those tools to achieve those goals.”
Minneapolis Fed President, Neel Kashkari, a non-voter this year, said, “ I believe the FOMC should take strong action to re-anchor inflation expectations at our 2% target and support strong job growth, higher wage growth, and sustained economic expansion.
Federal Reserve Governor Lael Brainard remains optimistic that economic growth will continue at a solid pace, but pointed that recent indicators of inflation and inflation expectations have been disappointing, “making it all the more important to sustain the economy’s momentum,” she said.
It looks as if inflation levels and the labor market will have the biggest influence on policymakers. This puts the emphasis on Friday’s PCE deflator, a major inflation indicator for the Fed, and the July 5 U.S. Non-Farm Payrolls report.
If both come in weak then the market got it right and the Fed will cut at the end of the July. Stronger than expected inflation and labor market data will create a volatile situation in the financial markets.
Essentially, the decision to cut rates comes down to whether policymakers feel the need for insurance against an economic downturn, or the need to stimulate the economy.
Thisarticlewas originally posted on FX Empire
• USD just Gave Up
• Futures Weighed by Geopolitical Tensions, Upcoming Fed Speeches in Focus
• Gold Price Futures (GC) Technical Analysis – June 25, 2019 Forecast
• Gold Goes Boom as High Trend Resistance is Bulldozed by Bulls
• E-mini S&P 500 Index (ES) Futures Technical Analysis – June 25, 2019 Forecast
• Oil Price Fundamental Daily Forecast – Late Session API Report Could Trigger Volatile Reaction |
What Does GFT Technologies SE's (ETR:GFT) Balance Sheet Tell Us About It?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! GFT Technologies SE ( ETR:GFT ) is a small-cap stock with a market capitalization of €194m. 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? Understanding the company's financial health becomes essential, as mismanagement of capital can lead to bankruptcies, which occur at a higher rate for small-caps. The following basic checks can help you get a picture of the company's balance sheet strength. However, this is just a partial view of the stock, and I suggest you dig deeper yourself into GFT here . Does GFT Produce Much Cash Relative To Its Debt? Over the past year, GFT has maintained its debt levels at around €112m – this includes long-term debt. At this constant level of debt, the current cash and short-term investment levels stands at €63m to keep the business going. On top of this, GFT has generated €47m in operating cash flow in the last twelve months, leading to an operating cash to total debt ratio of 42%, signalling that GFT’s operating cash is sufficient to cover its debt. Can GFT pay its short-term liabilities? With current liabilities at €110m, the company has been able to meet these obligations given the level of current assets of €179m, with a current ratio of 1.63x. The current ratio is the number you get when you divide current assets by current liabilities. Usually, for IT companies, this is a suitable ratio since there is a bit of a cash buffer without leaving too much capital in a low-return environment. XTRA:GFT Historical Debt, June 24th 2019 Is GFT’s debt level acceptable? With a debt-to-equity ratio of 86%, GFT can be considered as an above-average leveraged company. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. We can check to see whether GFT 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 GFT's, case, the ratio of 11.21x suggests that interest is comfortably covered, which means that lenders may be inclined to lend more money to the company, as it is seen as safe in terms of payback. Story continues Next Steps: GFT’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 GFT's liquidity needs, this may be its optimal capital structure for the time being. I admit this is a fairly basic analysis for GFT's financial health. Other important fundamentals need to be considered alongside. I recommend you continue to research GFT Technologies to get a more holistic view of the small-cap by looking at: Future Outlook : What are well-informed industry analysts predicting for GFT’s future growth? Take a look at our free research report of analyst consensus for GFT’s outlook. Valuation : What is GFT 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 GFT 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. |
What Does GFT Technologies SE's (ETR:GFT) Balance Sheet Tell Us About It?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
While small-cap stocks, such as GFT Technologies SE (ETR:GFT) with its market cap of €194m, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Evaluating financial health as part of your investment thesis is essential, as mismanagement of capital can lead to bankruptcies, which occur at a higher rate for small-caps. We'll look at some basic checks that can form a snapshot the company’s financial strength. However, these checks don't give you a full picture, so I recommend youdig deeper yourself into GFT here.
GFT's debt level has been constant at around €112m over the previous year – this includes long-term debt. At this current level of debt, GFT's cash and short-term investments stands at €63m , ready to be used for running the business. Additionally, GFT has generated €47m in operating cash flow during the same period of time, leading to an operating cash to total debt ratio of 42%, indicating that GFT’s current level of operating cash is high enough to cover debt.
With current liabilities at €110m, the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.63x. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for IT 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.
GFT is a relatively highly levered company with a debt-to-equity of 86%. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. We can test if GFT’s debt levels are sustainable by measuring interest payments against earnings of a company. Ideally, earnings before interest and tax (EBIT) should cover net interest by at least three times. For GFT, the ratio of 11.21x suggests that interest is comfortably covered, which means that lenders may be inclined to lend more money to the company, as it is seen as safe in terms of payback.
GFT’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 GFT'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 GFT has company-specific issues impacting its capital structure decisions. You should continue to research GFT Technologies to get a better picture of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for GFT’s future growth? Take a look at ourfree research report of analyst consensusfor GFT’s outlook.
2. Valuation: What is GFT 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 GFT 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. |
How Do Analysts See Griffin Mining Limited (LON:GFM) Performing Over The Next Few Years?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
In June 2019, Griffin Mining Limited (LON:GFM) announced its most recent earnings update, which suggested that the company endured a substantial headwind with earnings falling by -41%. Today I want to provide a brief commentary on how market analysts predict Griffin Mining's earnings growth outlook over the next few years and whether the future looks brighter. 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 Griffin Mining
Market analysts' consensus outlook for the upcoming year seems pessimistic, with earnings decreasing by a double-digit -35%. However, the next few years seem to illustrate a completely different picture, with expected earnings growth rates reaching double digit 27% compared to today’s level and continues to increase.
Even though it is informative understanding the growth each year relative to today’s figure, it may be more insightful estimating the rate at which the business is moving every year, on average. The advantage of this technique is that we can get a bigger picture of the direction of Griffin Mining'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 29%. This means, we can anticipate Griffin Mining will grow its earnings by 29% every year for the next few years.
For Griffin Mining, I've compiled three key aspects you should look at:
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 GFM 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 GFM is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of GFM? 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. |
Griffin Mining Limited (LON:GFM): What Can We Expect From This High Growth Stock?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Griffin Mining Limited's (LON:GFM) latest earnings announcement in June 2019 revealed that the business faced a significant headwind with earnings declining by -41%. Below is a brief commentary on my key takeaways on how market analysts view Griffin Mining's earnings growth outlook over the next few years and whether the future looks brighter. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in.
Check out our latest analysis for Griffin Mining
Market analysts' prospects for next year seems pessimistic, with earnings reducing by a double-digit -35%. However, the next few years seem to illustrate a completely different picture, with expected earnings growth rates reaching double digit 27% compared to today’s level and continues to increase.
While it is helpful to be aware of the rate of growth each year relative to today’s value, it may be more insightful to gauge the rate at which the earnings are rising or falling every year, on average. The advantage of this technique is that we can get a better picture of the direction of Griffin Mining'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 put 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 29%. This means that, we can assume Griffin Mining will grow its earnings by 29% every year for the next couple of years.
For Griffin Mining, there are three key factors you should look at:
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 GFM 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 GFM is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of GFM? 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 Kind Of Shareholder Appears On The Genel Energy plc's (LON:GENL) Shareholder Register?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Every investor in Genel Energy plc (LON:GENL) should be aware of the most powerful shareholder groups. 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.
Genel Energy is not a large company by global standards. It has a market capitalization of UK£495m, which means it wouldn't have the attention of many institutional investors. In the chart below below, we can see that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholder can tell us about GENL.
Check out our latest analysis for Genel Energy
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 Genel Energy does have institutional investors; and they hold 32% of the stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Genel Energy, (below). Of course, keep in mind that there are other factors to consider, too.
Hedge funds don't have many shares in Genel Energy. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 less than 1% of Genel Energy plc. But they may have an indirect interest through a corporate structure that we haven't picked up on. It has a market capitalization of just UK£495m, and the board has only UK£4.2m worth of shares in their own names. Many investors in smaller companies prefer to see the board more heavily invested. You canclick here to see if those insiders have been buying or selling.
With a 37% ownership, the general public have some degree of sway over GENL. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Our data indicates that Private Companies hold 30%, of the company's shares. 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.
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.
I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow, for free.
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. |
Japanese stocks edge higher but gains limited as markets brace for G20
* Topix turnover lowest since Dec. 2014
* Oil shares outperform on tensions in Middle East
* Investors unwind both long and short positions - analyst
By Ayai Tomisawa
TOKYO, June 24 (Reuters) - Japan's Nikkei edged higher in cautious trade on Monday as investors looked ahead to this week's G20 summit amid a backdrop of rising trade and geopolitical tensions.
The Nikkei share average ended 0.1% higher at 21,285.99 points, after traversing positive and negative territory.
The broader Topix gained 0.1% to 1,547.74, with only 830 million shares changing hands, the lowest level since December 2011. Turnover was 1.4 trillion yen, the lowest since December 2014.
Analysts said investors were on the sidelines ahead of an expected meeting between Chinese and U.S. leaders on the sidelines of the G20 summit on June 28-29 in Osaka, Japan.
China's President Xi Jinping will attend the G20 summit, state-run Xinhua news agency said on Sunday, giving the first official confirmation of his attendance at a gathering where he is expected to meet U.S. President Donald Trump. Markets are hoping the two leaders could help restart stalled talks to resolve a months-long trade war.
"It's good that Trump and Xi are meeting but we still don't know what comes out of the meeting so investors are unwinding both their long and short positions," said Yutaka Miura, a senior technical analyst at Mizuho Securities.
Tensions in the Middle East also kept investors on edge.
Trump said on Sunday he was not seeking war with Tehran after a senior Iranian military commander warned any conflict in the Gulf region could spread uncontrollably and threaten the lives of U.S. troops.
But U.S. Secretary of State Mike Pompeo also said "significant" sanctions on Iran would be announced on Monday aimed at further choking off resources that Tehran uses to fund its activities in the region.
That kept oil prices high, and pushed up Cosmo Energy Holdings 1.5% and Idemitsu Kosan 0.8%.
Exporters - especially those with large exposure to China - were down as the dollar remained pressured against the yen, with signs the Federal Reserve might move to cut rates soon denting the greenback.
Tokyo Electron shed 1.7% and TDK Corp dropped 0.8%. (Editing by Shri Navaratnam & Kim Coghill) |
‘Insane’ Bitcoin Momentum Goes Overdrive as 'Real Volume' Hits $1.5 Billion
ByCCN Markets: Bitcoin price has increased by 16 percent in the past week against the U.S. dollar following its initial breakout of the $10,000 mark on June 21.
The bitcoin price is up 16 percent in the past week against the U.S. dollar following a 3-fold increase from $3,150 to $10,000 (source: coinmarketcap.com)
Luke Martin, a crypto trader, has said that the momentum of the dominant crypto asset is “insane,” indicating that minor corrections are being absorbed by the market at a fast pace and that the short term trend of the asset remains strong.
Earlier this month, the “real 10” volume of bitcoin which refers to the daily spot volume of exchanges with more than $1 million in verifiable daily volume as found by Bitwise Asset Management, hovered at around $500 million.
In the last several days, the real 10 volume of the asset has spiked to over $1.5 billion, peaking at $2 billion.
Read the full story on CCN.com. |
Here's Why I Think Himadri Speciality Chemical (NSE:HSCL) Is An Interesting Stock
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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. Unfortunately, high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson.
In the age of tech-stock blue-sky investing, my choice may seem old fashioned; I still prefer profitable companies likeHimadri Speciality Chemical(NSE:HSCL). 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.
See our latest analysis for Himadri Speciality Chemical
Over the last three years, Himadri Speciality Chemical has grown earnings per share (EPS) like young bamboo after rain; fast, and from a low base. So I don't think the percent growth rate is particularly meaningful. As a result, I'll zoom in on growth over the last year, instead. Like a falcon taking flight, Himadri Speciality Chemical's EPS soared from ₹5.91 to ₹7.75, over the last year. That's a commendable gain of 31%.
I like to take a look at earnings before interest and (EBIT) tax margins, as well as revenue growth, to get another take on the quality of the company's growth. Himadri Speciality Chemical maintained stable EBIT margins over the last year, all while growing revenue 20% to ₹24b. That's a real positive.
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.
Of course the knack is to find stocks that have their best days in the future, not in the past. You could base your opinion on past performance, of course, but you may also want tocheck this interactive graph of professional analyst EPS forecasts for Himadri Speciality Chemical.
It makes me feel more secure owning shares in a company if insiders also own shares, thusly more closely aligning our interests. As a result, I'm encouraged by the fact that insiders own Himadri Speciality Chemical shares worth a considerable sum. To be specific, they have ₹2.4b worth of shares. That shows significant buy-in, and may indicate conviction in the business strategy. Those holdings account for over 5.3% of the company; visible skin in the game.
For growth investors like me, Himadri Speciality Chemical's raw rate of earnings growth is a beacon in the night. Further, the high level of insider buying impresses me, and suggests that I'm not the only one who appreciates the EPS growth. Fast growth and confident insiders should be enough to warrant further research. So the answer is that I do think this is a good stock to follow along with. Of course, identifying quality businesses is only half the battle; investors need to know whether the stock is undervalued. So you might want to consider thisfreediscounted cashflow valuationof Himadri Speciality Chemical.
Although Himadri Speciality Chemical certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
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. |
Here's Why I Think Himadri Speciality Chemical (NSE:HSCL) Might Deserve Your Attention Today
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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. Unfortunately, high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson.
In the age of tech-stock blue-sky investing, my choice may seem old fashioned; I still prefer profitable companies likeHimadri Speciality Chemical(NSE:HSCL). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed.
Check out our latest analysis for Himadri Speciality Chemical
In the last three years Himadri Speciality Chemical's earnings per share took off like a rocket; fast, and from a low base. So the actual rate of growth doesn't tell us much. As a result, I'll zoom in on growth over the last year, instead. Like a wedge-tailed eagle on the wind, Himadri Speciality Chemical's EPS soared from ₹5.91 to ₹7.75, in just one year. That's a impressive gain of 31%.
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. Himadri Speciality Chemical maintained stable EBIT margins over the last year, all while growing revenue 20% to ₹24b. That's a real positive.
You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.
While we live in the present moment at all times, there's no doubt in my mind that the future matters more than the past. So why not checkthis interactive chart depicting future EPS estimates, for Himadri Speciality Chemical?
I like company leaders to have some skin in the game, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. As a result, I'm encouraged by the fact that insiders own Himadri Speciality Chemical shares worth a considerable sum. To be specific, they have ₹2.4b worth of shares. That's a lot of money, and no small incentive to work hard. That amounts to 5.3% of the company, demonstrating a degree of high-level alignment with shareholders.
You can't deny that Himadri Speciality Chemical has grown its earnings per share at a very impressive rate. That's attractive. Further, the high level of insider buying impresses me, and suggests that I'm not the only one who appreciates the EPS growth. So this is very likely the kind of business that I like to spend time researching, with a view to discerning its true value. Of course, identifying quality businesses is only half the battle; investors need to know whether the stock is undervalued. So you might want to consider thisfreediscounted cashflow valuationof Himadri Speciality Chemical.
Although Himadri Speciality Chemical certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
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. |
Why We Think Honeywell Automation India Limited (NSE:HONAUT) Could Be Worth Looking At
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Honeywell Automation India Limited (NSE:HONAUT) due to its excellent fundamentals in more than one area. HONAUT is a financially-healthy company with a great track record and an optimistic growth outlook. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at thereport on Honeywell Automation India here.
HONAUT delivered a bottom-line expansion of 44% in the prior year, with its most recent earnings level surpassing its average level over the last five years. The strong earnings growth is reflected in impressive double-digit 21% return to shareholders, which paints a buoyant picture for the company.
HONAUT's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. Investors should not worry about HONAUT’s debt levels because the company has none! This implies that the company is running its operations purely on off equity funding. which is rather impressive for a ₹218b market cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
For Honeywell Automation India, there are three important aspects you should further research:
1. Valuation: What is HONAUT 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 HONAUT is currently mispriced by the market.
2. Dividend Income vs Capital Gains: Does HONAUT return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Ourhistorical dividend yield visualizationquickly tells you what your can expect from HONAUT as an investment.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HONAUT? Exploreour interactive list of stocks with large 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. |
Lufthansa pegs dividend payout ratio to net profit
FRANKFURT (Reuters) - German carrier Lufthansa on Monday said it would start pegging its dividend payout ratio to net profit in the future, adding this would give the group, which issued a profit warning a week ago, more flexibility.
Lufthansa said it would pay out a regular dividend of 20-40% of net profit, adjusted for one-off gains and losses, in the future. Its previous dividend policy was based on a payout ratio of 10-25% of earnings before interest and tax.
"The payout range of the new dividend policy offers the Group more flexibility compared to the previous policy to achieve dividend continuity," the group said, without elaborating further.
Shares in Lufthansa, which is due to hold its capital markets day on Monday, were up by 1.8% in early Frankfurt trade, according to data from Lang & Schwarz.
Based on Refinitiv estimates for the year 2019, the new payout ratio would result in a total dividend payment of 305 million to 611 million euros ($347-$696 million), compared with 233-583 million under the old regime.
Poor margins at Eurowings compared with sector rivals were cited by Lufthansa last week as a major reason for the profit warning. Eurowings' revenue was also forecast to fall sharply in the second quarter.
(Reporting by Christoph Steitz; Editing by Michelle Martin) |
How Much is Hindustan Composites Limited's (NSE:HINDCOMPOS) CEO Getting Paid?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
P. Choudhary has been the CEO of Hindustan Composites Limited (NSE:HINDCOMPOS) since 2008. 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. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This process should give us an idea about how appropriately the CEO is paid.
Check out our latest analysis for Hindustan Composites
At the time of writing our data says that Hindustan Composites Limited has a market cap of ₹2.8b, and is paying total annual CEO compensation of ₹7.9m. (This figure is for the year to March 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at ₹6.5m. We looked at a group of companies with market capitalizations under ₹14b, and the median CEO total compensation was ₹1.3m.
Thus we can conclude that P. Choudhary receives more in total compensation than the median of a group of companies in the same market, and of similar size to Hindustan Composites Limited. However, this doesn't necessarily mean the pay is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
The graphic below shows how CEO compensation at Hindustan Composites has changed from year to year.
Hindustan Composites Limited has reduced its earnings per share by an average of 1.7% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is down -1.3%.
The lack of earnings per share growth in the last three years is unimpressive. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. Although we don't have analyst forecasts, shareholders might want to examinethis detailed historical graphof earnings, revenue and cash flow.
Given the total loss of 47% over three years, many shareholders in Hindustan Composites Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We compared total CEO remuneration at Hindustan Composites Limited with the amount paid at companies with a similar market capitalization. Our data suggests that it pays above the median CEO pay within that group.
Earnings per share have not grown in three years, and the revenue growth fails to impress us.
Arguably worse, investors are without a positive return for the last three years. This analysis suggests to us that the CEO is paid too generously! If you think CEO compensation levels are interesting you will probably really likethis free visualization of insider trading at Hindustan Composites.
If you want to buy a stock that is better than Hindustan Composites, thisfreelist of high return, low debt companies is a great place to look.
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. |
How Much is Hornbach Holding AG & Co. KGaA's (FRA:HBH) CEO Getting Paid?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Albrecht Hornbach is the CEO of Hornbach Holding AG & Co. KGaA (FRA:HBH). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Hornbach Holding KGaA
At the time of writing our data says that Hornbach Holding AG & Co. KGaA has a market cap of €727m, and is paying total annual CEO compensation of €1.0m. (This is based on the year to February 2019). That's below the compensation, last year. We think total compensation is more important but we note that the CEO salary is lower, at €419k. When we examined a selection of companies with market caps ranging from €353m to €1.4b, we found the median CEO total compensation was €1.0m.
So Albrecht Hornbach is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.
You can see, below, how CEO compensation at Hornbach Holding KGaA has changed over time.
Hornbach Holding AG & Co. KGaA has reduced its earnings per share by an average of 4.8% a year, over the last three years (measured with a line of best fit). In the last year, its revenue is up 5.3%.
Sadly for shareholders, earnings per share are actually down, over three years. And the modest revenue growth over 12 months isn't much comfort against the reduced earnings per share. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Since shareholders would have lost about 17% over three years, some Hornbach Holding AG & Co. KGaA shareholders would surely be feeling negative emotions. This suggests it would be unwise for the company to pay the CEO too generously.
Remuneration for Albrecht Hornbach is close enough to the median pay for a CEO of a similar sized company .
Returns have been disappointing and the company is not growing its earnings per share. Few would argue that it's wise for the company to pay any more, before returns improve. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Hornbach Holding KGaA (free visualization of insider trades).
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. |
How Do Getech Group Plc’s (LON:GTC) Returns On Capital Compare To Peers?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we are going to look at Getech Group Plc (LON:GTC) to see whether it might be an attractive investment prospect. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires.
First, we'll go over how we calculate ROCE. Second, we'll look at its ROCE compared to similar companies. Finally, we'll look at how its current liabilities affect its ROCE.
ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. In general, businesses with a higher ROCE are usually better quality. In brief, it is a useful tool, but it is not without drawbacks. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
The formula for calculating the return on capital employed is:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Getech Group:
0.031 = UK£447k ÷ (UK£17m - UK£3.0m) (Based on the trailing twelve months to December 2018.)
So,Getech Group has an ROCE of 3.1%.
See our latest analysis for Getech Group
ROCE is commonly used for comparing the performance of similar businesses. Using our data, Getech Group's ROCE appears to be significantly below the 11% average in the Energy Services industry. This could be seen as a negative, as it suggests some competitors may be employing their capital more efficiently. Regardless of how Getech Group stacks up against its industry, its ROCE in absolute terms is quite low (especially compared to a bank account). There are potentially more appealing investments elsewhere.
Getech Group's current ROCE of 3.1% is lower than 3 years ago, when the company reported a 8.0% ROCE. Therefore we wonder if the company is facing new headwinds.
It is important to remember that ROCE shows past performance, and is not necessarily predictive. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is, after all, simply a snap shot of a single year. Remember that most companies like Getech Group are cyclical businesses. What happens in the future is pretty important for investors, so we have prepared afreereport on analyst forecasts for Getech Group.
Liabilities, such as supplier bills and bank overdrafts, are referred to as current liabilities if they need to be paid within 12 months. Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual. To counteract this, we check if a company has high current liabilities, relative to its total assets.
Getech Group has total assets of UK£17m and current liabilities of UK£3.0m. As a result, its current liabilities are equal to approximately 17% of its total assets. This is not a high level of current liabilities, which would not boost the ROCE by much.
While that is good to see, Getech Group has a low ROCE and does not look attractive in this analysis. But note:make sure you look for a great company, not just the first idea you come across.So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20).
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. |
If You Had Bought Gore Street Energy Storage Fund (LON:GSF) Stock A Year Ago, You'd Be Sitting On A 11% Loss, Today
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
The simplest way to benefit from a rising market is to buy an index fund. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. Unfortunately theGore Street Energy Storage Fund Plc(LON:GSF) share price slid 11% over twelve months. That falls noticeably short of the market return of around 0.6%. Gore Street Energy Storage Fund may have better days ahead, of course; we've only looked at a one year period. On the other hand, we note it's up 8.8% in about a month.
View our latest analysis for Gore Street Energy Storage Fund
Gore Street Energy Storage Fund hasn't yet reported any revenue yet, so it's as much a business idea as an actual business. This state of affairs suggests that venture capitalists won't provide funds on attractive terms. As a result, we think it's unlikely shareholders are paying much attention to current revenue, but rather speculating on growth in the years to come. Investors will be hoping that Gore Street Energy Storage Fund can make progress and gain better traction for the business, before it runs low on cash.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. You should be aware that there is always a chance that this sort of company will need to issue more shares to raise money to continue pursuing its business plan. 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.
When it last reported its balance sheet in March 2019, Gore Street Energy Storage Fund could boast a strong position, with cash in excess of all liabilities of UK£17m. This gives management the flexibility to drive business growth, without worrying too much about cash reserves. But since the share price has dropped 11% in the last year, it seems like the market might have been over-excited previously. The image below shows how Gore Street Energy Storage Fund's balance sheet has changed over time; if you want to see the precise values, simply click on the image.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. 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.
It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Gore Street Energy Storage Fund, it has a TSR of -6.9% for the last year. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted thetotalshareholder return.
Given that the market gained 0.6% in the last year, Gore Street Energy Storage Fund shareholders might be miffed that they lost 6.9% (even including dividends). However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. The share price decline has continued throughout the most recent three months, down 5.0%, suggesting an absence of enthusiasm from investors. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. Keeping this in mind, a solid next step might be to take a look at Gore Street Energy Storage Fund's dividend track record. Thisfreeinteractive graphis a great place to start.
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB 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. |
Firefighters smash window to rescue 18-month-old boy left in dangerously hot car for more than an hour
The boy was pulled to safety by firefighters who smashed a window to get to him (Picture: SWNS) Firefighters smashed the window of a car to rescue an 18-month-old boy who had been left in the dangerously hot vehicle for more than an hour. The toddler had been left inside a 4x4 in a car park in Saffron Walden, Essex, on Saturday when temperatures reached up to 25C. A passerby at a nearby fun day heard the boy screaming from inside the locked vehicle and raised the alarm. The ticket stub on the dashboard of the Nissan X-Trail indicated that the boy may have been left inside for more than an hour. Crowds watched the rescue operation after an announcement was made at the fun day urging the boy’s parents to return to their car. Firefighters try to open the doors of the locked 4x4 with a toddler inside (Picture: SWNS) The boy was pulled from the car at about 4.30pm after firefighters smashed the driver’s window. A woman, believed to be his mother, eventually returned with another young boy. The toddler was passed to her and they were taken into the back of an ambulance where he was assessed by medical staff. Police spoke to the woman in the back of the ambulance for more than half an hour. It is understood the woman was later allowed to leave the scene in her car with the two children. Read more Men jailed after filming dogs mauling badgers to death in act of 'medieval barbarity' Boris Johnson's neighbour speaks out after calling the police to domestic disturbance Woman arrested after RAF jets scrambled to escort Jet2 flight back to Stansted Witness Cheryl Thomas, 42, an accounts manager and a mother-of-two, said: "It was unbelievable. We were all enjoying a day out and suddenly they announced this crying little boy had been left inside a hot car. "We could see the car park from where we were and everyone looked over to see paramedics outside the car, frantically trying to get in. "Everyone was looking round for a parent rushing over but no-one came. We couldn't believe it when ten minutes later there was still no sign of anyone. "It was such a hot day, we actually got sunburn while we were out there so that poor little boy must have been in such distress. Story continues "It brings me to tears thinking about what he must have been going through. "Then this woman just appeared from nowhere. No one realised she was the boy's mum to begin with as she didn't seem to show any emotion over what was happening. Firefighters smashed a window before pulling the boy free (Picture: SWNS) Firefighters and police were called to the scene in Saffron Walden, Essex, on Saturday (Picture: SWNS) "She had another little boy with her, who was older and holding her hand. We just couldn't understand why you would take one child out with you and leave one in the car for so long. "Who knows where she had been or what she was doing. She didn't have any bags with her, just a big handbag, so whether she'd popped to a shop or not, I don't know. "To leave your child for a minute is too long though, let alone an hour." Yesterday afternoon our crews rescued a small child who had been left unattended in a car in Saffron Walden. It is incredibly dangerous to leave a child, pet or anyone vulnerable in a vehicle... particularly in this heat. Please don't run the risk! #StaySafe pic.twitter.com/irSeFfZu09 — Essex Fire Service (@ECFRS) June 23, 2019 Saffron Walden Fire Station posted a picture of the smashed window on Facebook and said: "Well a first for us! We have been called to animals locked in cars while the owners go shopping but never a child. "We cannot stress enough how dangerous it is to leave any person, child or animal locked in a car in this heat. "The child was rescued by our crew who smashed a window to gain entry. The incident has now been handed over to Essex Police for further investigation. First aid was given by St John Ambulance crew." ---Watch the latest videos from Yahoo UK--- |
Santa Anita season ends after 30 horse deaths, trainer ban
ARCADIA, Calif. (AP) — Santa Anita's troubled racing season has come to a close after the deaths of 30 horses at the Southern California track rattled the industry and led to Hall of Fame trainer Jerry Hollendorfer being banned when four of his horses were among the casualties. There were no incidents during morning training hours or in the 10 races Sunday. About 20 protesters briefly toted signs outside an entrance to the track, calling attention to the deaths and condemning the sport. Hollendorfer had two horses entered to run closing day, but they, along with two others Saturday, were scratched by track stewards on the recommendation of a special panel convened to review horses' medical, training and racing history. The 73-year-old trainer was ordered by The Stronach Group to remove his horses from Santa Anita and Golden Gate Fields in Northern California, which are owned by the company. The fourth death in his stable during the meet occurred Saturday. Track ownership said Hollendorfer was "no longer welcome to stable, race, or train his horses at any of our facilities." No one from The Stronach Group spoke to the media Sunday despite a request. The company said a statement would be forthcoming in a few days. Racing next moves to Los Alamitos in Orange County beginning June 29, where the California Horse Racing Board said a panel will review horses entered to run there. That track will "gladly" provide stalls to Hollendorfer, whom track owner Edward Allred called "an unexcelled horseman." "Unless forbidden by the California Horse Racing Board, we intend to permit entries from Hollendorfer," Allred said in a statement. "We do not feel he should be a scapegoat for a problem which derives from a number of factors." Still unknown is whether Hollendorfer would be allowed to train at Del Mar near San Diego, which opens its summer meet July 17. A track spokesman said Sunday a decision had yet to be made. Neither Los Alamitos nor Del Mar is owned by The Stronach Group. Story continues Racing at Santa Anita is set to resume Sept. 27. The track is scheduled to host the Breeders' Cup world championships on Nov. 1-2. The Breeders' Cup board of directors is expected to meet this week to discuss this year's location. The fatalities at Santa Anita since Dec. 26 have raised alarm within California and the rest of the racing industry. Gov. Gavin Newsom recently stepped in to direct the formation of the special panel to evaluate horses' histories before they race. Track and racing board officials implemented several changes involving exams of horses scheduled to train or race. The racing board also is looking at changes involving jockeys' use of a riding crop in a race. Hall of Fame jockey Kent Desormeaux was fined $100 by the stewards for violating a CHRB rule that prohibits use of a crop more than three times in succession without giving the horse a chance to respond. The violation occurred in the eighth race Saturday. Bob Baffert, the two-time Triple Crown-winning trainer, recently traveled to Sacramento to meet legislators concerned about the horse deaths. The majority occurred during the winter months when usually arid Santa Anita was hit with record rainfall totaling nearly a foot. Trainers like Doug O'Neill, a two-time Kentucky Derby winner, are dismayed that the sport is under fire amid a drumbeat of negativity. "The important thing is that they are accidents and accidents happen," O'Neill said. "I can you tell in the 32 years I've been back here I've never seen one case of an abuse." About 500 backstretch workers rallied on Thursday to ask for help in protecting their jobs, emphasize their commitment to the horses in their care and their support of the recent rules changes. O'Neill and Baffert support the workers, many of whom come from Mexico and Guatemala. "Right now I'm worried about keeping these horses and keeping people here," Baffert said. "If it went away, I worry about all these unemployed people." O'Neill noted there are good things done by the racing industry but "it's just unfortunate that very little of that is talked about." He lamented what he perceives as a lack of transparency by Santa Anita management about what's happening. "You'd like to hear more dialogue between all the different factions that are involved," O'Neill said. "It seems like there's these small little groups that have all the power. They have their private meetings and none of it gets trickled down to us what the heck is going on." The Stronach Group has moved to reduce the use of anti-bleeding medication Lasix on race days. Going further, there's been a proposal to eliminate Lasix in 2-year-old horses starting next year. "Racing needs Santa Anita to work," Baffert said. "Santa Anita is so important. If something happens here, it affects everything." ___ More AP sports: https://apnews.com/apf-sports and https://twitter.com/AP_Sports |
Volatility 101: Should Global Ports Holding (LON:GPH) Shares Have Dropped 27%?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. That downside risk was realized byGlobal Ports Holding Plc(LON:GPH) shareholders over the last year, as the share price declined 27%. That falls noticeably short of the market return of around 0.6%. Global Ports Holding hasn't been listed for long, so although we're wary of recent listings that perform poorly, it may still prove itself with time. Even worse, it's down 8.4% in about a month, which isn't fun at all.
View our latest analysis for Global Ports Holding
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
During the last year Global Ports Holding grew its earnings per share, moving from a loss to a profit. It's good to see it turn a profit, but we note it was reasonably close to profitability last year. Taking a look at the share price, it seems that investors were expecting better from the company. Given the improvement, though, contrarian investors might want to take a closer look.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
Before buying or selling a stock, we always recommend a close examination ofhistoric growth trends, available here..
It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, Global Ports Holding's TSR for the last year was -20%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!
Given that the market gained 0.6% in the last year, Global Ports Holding shareholders might be miffed that they lost 20% (even including dividends). While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. The share price decline has continued throughout the most recent three months, down 3.4%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Before forming an opinion on Global Ports Holding you might want to consider the cold hard cash it pays as a dividend. Thisfreechart tracks its dividend over time.
Of courseGlobal Ports Holding may not be the best stock to buy. So you may wish to see thisfreecollection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB 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. |
Estimating The Fair Value Of Inspiration Healthcare Group plc (LON:IHC)
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we will run through one way of estimating the intrinsic value of Inspiration Healthcare Group plc (LON:IHC) by taking the foreast future cash flows of the company and discounting them back to today's value. I will be using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. 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 Inspiration Healthcare Group
We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. To start off with, we need to estimate 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, so we discount the value of these future cash flows to their estimated value in today's dollars:
[{"": "Levered FCF (\u00a3, Millions)", "2019": "\u00a30.30", "2020": "\u00a30.30", "2021": "\u00a30.70", "2022": "\u00a30.93", "2023": "\u00a31.15", "2024": "\u00a31.34", "2025": "\u00a31.50", "2026": "\u00a31.64", "2027": "\u00a31.75", "2028": "\u00a31.83"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x1", "2020": "Analyst x1", "2021": "Analyst x1", "2022": "Est @ 32.98%", "2023": "Est @ 23.45%", "2024": "Est @ 16.78%", "2025": "Est @ 12.12%", "2026": "Est @ 8.85%", "2027": "Est @ 6.56%", "2028": "Est @ 4.96%"}, {"": "Present Value (\u00a3, Millions) Discounted @ 7.22%", "2019": "\u00a30.28", "2020": "\u00a30.26", "2021": "\u00a30.57", "2022": "\u00a30.70", "2023": "\u00a30.81", "2024": "\u00a30.88", "2025": "\u00a30.92", "2026": "\u00a30.94", "2027": "\u00a30.93", "2028": "\u00a30.91"}]
Present Value of 10-year Cash Flow (PVCF)= £7.21m
"Est" = FCF growth rate estimated by Simply Wall St
After calculating the present value of future cash flows in the intial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond 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 (1.2%) 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 7.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = UK£1.8m × (1 + 1.2%) ÷ (7.2% – 1.2%) = UK£31m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= £UK£31m ÷ ( 1 + 7.2%)10= £15.42m
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is £22.63m. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of £0.74. Compared to the current share price of £0.67, the company appears about fair value at a 9.9% 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.
We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. 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 Inspiration Healthcare Group 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 7.2%, which is based on a levered beta of 0.901. 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 Inspiration Healthcare Group, There are three further factors you should further research:
1. Financial Health: Does IHC 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 IHC'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 IHC? 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 LON 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. |
Santander to pay 1 billion euros to end insurance accord with Allianz Group
MADRID (Reuters) - Spain's largest lender Banco Santander said on Monday it will pay almost 1 billion euros ($1.1 billion) to end an agreement between Allianz and Banco Popular over the distribution of insurance products.
Banco Popular, saddled with debt, became the first bank to be wound down using new European rules aimed at avoiding taxpayer funded bailouts and was sold to Santander for a nominal one euro in June 2017.
Santander agreed to pay 936.5 million euros ($1.07 billion)for Allianz Group's 60% stake in Allianz Popular which distributed insurance products for Banco Popular in Spain.
Allianz Popular owned life insurance group Allianz Popular Vida, asset management group Allianz Popular Asset Management and Allianz Popular Pensiones.
The agreement, which concludes the reorganization of the Spanish insurance, asset management and pension plan businesses following the Popular acquisition, would reduce Santander's fully-loaded CET1 capital by around 8 basis points, the bank said.
The agreement is expected to be terminated in the first quarter of 2020 subject to permission from the regulatory and anti-trust authorities.
(Reporting by Paul Day, editing by Louise Heavens) |
Calculating The Fair Value Of Inspiration Healthcare Group plc (LON:IHC)
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we will run through one way of estimating the intrinsic value of Inspiration Healthcare Group plc (LON:IHC) by taking the foreast future cash flows of the company and discounting them back to today's value. I will be using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
View our latest analysis for Inspiration Healthcare Group
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To start off with, we need to estimate 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.
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF (\u00a3, Millions)", "2019": "\u00a30.30", "2020": "\u00a30.30", "2021": "\u00a30.70", "2022": "\u00a30.93", "2023": "\u00a31.15", "2024": "\u00a31.34", "2025": "\u00a31.50", "2026": "\u00a31.64", "2027": "\u00a31.75", "2028": "\u00a31.83"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x1", "2020": "Analyst x1", "2021": "Analyst x1", "2022": "Est @ 32.98%", "2023": "Est @ 23.45%", "2024": "Est @ 16.78%", "2025": "Est @ 12.12%", "2026": "Est @ 8.85%", "2027": "Est @ 6.56%", "2028": "Est @ 4.96%"}, {"": "Present Value (\u00a3, Millions) Discounted @ 7.22%", "2019": "\u00a30.28", "2020": "\u00a30.26", "2021": "\u00a30.57", "2022": "\u00a30.70", "2023": "\u00a30.81", "2024": "\u00a30.88", "2025": "\u00a30.92", "2026": "\u00a30.94", "2027": "\u00a30.93", "2028": "\u00a30.91"}]
Present Value of 10-year Cash Flow (PVCF)= £7.21m
"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 (1.2%) 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 7.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = UK£1.8m × (1 + 1.2%) ÷ (7.2% – 1.2%) = UK£31m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= £UK£31m ÷ ( 1 + 7.2%)10= £15.42m
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is £22.63m. To get the intrinsic value per share, we divide this by the total number of shares outstanding.This results in an intrinsic value estimate of £0.74. Compared to the current share price of £0.67, the company appears about fair value at a 9.9% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. 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 Inspiration Healthcare Group 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 7.2%, which is based on a levered beta of 0.901. 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 Inspiration Healthcare Group, There are three fundamental aspects you should further research:
1. Financial Health: Does IHC 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 IHC'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 IHC? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. Simply Wall St updates its DCF calculation for every GB stock every day, so if you want to find the intrinsic value of any other stock 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. |
Everipedia 2.0 launches public beta
Everipedia – the world’s first encyclopedia built on blockchain technology – has officially rolled out the Everipedia 2.0 public beta. The announcement was made on Everipedia’s Medium blog page and included additional information regarding the company’s future roadmap. For the past couple of weeks, the platform has been in private beta and locked for editing while the team worked hard to prepare for the public beta launch. Everipedia 2.0 is now available for everyone to access as a public beta site. The announcement post reads: “We are excited to invite our community to interact with Everipedia 2.0 as we enter this next phase of the beta, focused on driving greater engagement, improving the process of learning IQ tokens, and streamlining our collective knowledge base.” The public beta has arrived with changes such as a modernised design, support for mobile accessibility, simplified login options, an enhanced editor, an advanced real-time chat and activity feed on all articles, and enhanced version history. The announcement also details Everipedia’s plans for its roadmap in both Q3 and Q4 2019, as well as updates for 2020. Coming up first, the company will be expanding its language support to allow further accessibility worldwide. Everipedia also intends to add an email login option, an advanced citation feature, the function to include media posts, new page templates, expanded leaderboards, intuitive version history, and editing streaks. Editing streaks will be similar to Snapchat streaks except they will be advanced by editing – this will be implemented to create a gamification aspect for editors to encourage them to participate more. Interested in reading more about Everipedia? Discover more about the project in Coin Rivet’s interview with the co-founder of Wikipedia, Larry Sanger, and Everipedia’s CEO, Theodor Forselius. The post Everipedia 2.0 launches public beta appeared first on Coin Rivet . |
Does Icade's (EPA:ICAD) Share Price Gain of 28% Match Its Business Performance?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Buying a low-cost index fund will get you the average market return. But across the board there are plenty of stocks that underperform the market. Unfortunately for shareholders, while theIcade(EPA:ICAD) share price is up 28% in the last three years, that falls short of the market return. Disappointingly, the share price is down 2.0% in the last year.
See our latest analysis for Icade
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
During three years of share price growth, Icade moved from a loss to profitability. So we would expect a higher share price over the period.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. Dive deeper into the earnings by checking this interactive graph of Icade'searnings, revenue and cash flow.
When looking at investment returns, it is important to consider the difference betweentotal shareholder return(TSR) andshare price return. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Icade the TSR over the last 3 years was 47%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!
Icade shareholders are up 1.0% for the year (even including dividends). But that return falls short of the market. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 5.4% over five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. Importantly, we haven't analysed Icade's dividend history. Thisfreevisual report on its dividendsis a must-read if you're thinking of buying.
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on FR 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. |
Are Dividend Investors Getting More Than They Bargained For With Icade's (EPA:ICAD) Dividend?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we'll take a closer look at Icade (EPA:ICAD) from a dividend investor's perspective. Owning a strong business and reinvesting the dividends is widely seen as an attractive way of growing your wealth. Unfortunately, it's common for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments.
With a nine-year payment history and a 5.8% yield, many investors probably find Icade intriguing. It sure looks interesting on these metrics - but there's always more to the story . Some simple analysis can reduce the risk of holding Icade for its dividend, and we'll focus on the most important aspects below.
Click the interactive chart for our full dividend analysis
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. In the last year, Icade paid out 89% of its profit as dividends. It's paying out most of its earnings, which limits the amount that can be reinvested in the business. This may indicate limited need for further capital within the business, or highlight a commitment to paying a dividend.
We also measure dividends paid against a company's levered free cash flow, to see if enough cash was generated to cover the dividend. Last year, Icade paid a dividend while reporting negative free cash flow. While there may be an explanation, we think this behaviour is generally not sustainable. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.
As Icade has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments on debt. Essentially we check that a) a company does not have too much debt, and b) that it can afford to pay the interest. Icade has net debt of 9.65 times its earnings before interest, tax, depreciation and amortisation (EBITDA) which implies meaningful risk if interest rates rise of earnings decline.
Net interest cover can be calculated by dividing earnings before interest and tax (EBIT) by the company's net interest expense. With EBIT of 2.08 times its interest expense, Icade's interest cover is starting to look a bit thin. Low interest cover and high debt can create problems right when the investor least needs them. We're generally reluctant to rely on the dividend of companies with these traits.
Consider gettingour latest analysis on Icade's financial position here.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. The first recorded dividend for Icade, in the last decade, was nine years ago. The dividend has been quite stable over the past nine years, which is great to see - although we usually like to see the dividend maintained for a decade before giving it full marks, though. During the past nine-year period, the first annual payment was €3.25 in 2010, compared to €4.60 last year. Dividends per share have grown at approximately 3.9% per year over this time.
Modest dividend growth is good to see, especially with the payments being relatively stable. However, the payment history is relatively short and we wouldn't want to rely on this dividend too much.
The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Over the long term, dividends need to grow at or above the rate of inflation, in order to maintain the recipient's purchasing power. Icade's EPS are effectively flat over the past five years. Over the long term, steady earnings per share is a risk as the value of the dividends can be reduced by inflation. Earnings are not growing quickly at all, and the company is paying out most of its profit as dividends. When a company prefers to pay out cash to its shareholders instead of reinvesting it, this can often say a lot about that company's dividend prospects.
To summarise, shareholders should always check that Icade's dividends are affordable, that its dividend payments are relatively stable, and that it has decent prospects for growing its earnings and dividend. First, the company has a payout ratio that was within an average range for most dividend stocks, but it paid out virtually all of its generated cash flow. Second, earnings growth has been ordinary, and its history of dividend payments is shorter than we'd like. In summary, Icade has a number of shortcomings that we'd find it hard to get past. Things could change, but we think there are likely more attractive alternatives out there.
Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 9 analysts we track are forecasting for Icadefor freewith publicanalyst estimates for the company.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Bitcoin Hits 15-Month High as Naysayers Double Down on 'Dead Cat Bounce'
Bitcoin (BTC) was holding steady around $10,850 on June 24 after a fresh surge took itabove $11,000for the first time in over a year.
Market visualization courtesy ofCoin360
Data from Coin360 showed a slight correction kicking in for bitcoin on Monday, marketsconsolidating gainsafter a dramatic weekend.
BTC/USD had climbed as high as $11,230 in recent days, marking its best performance since early March 2018.
The action did not go unnoticed, with mainstream media titles appearing to struggle with explaining the return of a cryptocurrency they had previously announced all but dead.
Many quoted traditional finance sources who maintained that the current bull-run is doomed to fail and that bitcoin investors will ultimately lose everything in fiat terms.
“Don’t get fooled by the dead-cat bounce this year,” Whitney Tilson, founder of Empire Financial Research and a former hedge-fund manager said quoted byBloomberg.
“Mark my words: A year from now, it will be a lot lower. This is a techno-libertarian pump-and-dump scheme that will end in ruin.”
Bitcoin’s weekly gains currently total just over 17%, while monthly returns are closer to 35%.
Bitcoin 7-day price chart. Source:Coin360
Altcoins fared somewhat worse as BTC/USD corrected, with many in the top twenty by market cap shedding 2-3% in the 24 hours to press time.
Ethereum (ETH) fell 3% to hit $306, while Ripple (XRP) was trading 5% lower at just over $0.45 per token. Bucking the trend was Tron (TRX), which gained 3.1% after the network saw the launch of its firststablecoinasset.
Ether 7-day price chart. Source:Coin360
The total cryptocurrency market cap is now comfortably above $300 billion, Bitcoin’s weekend moonshot further expanding its market dominance to more than 59%.
As Cointelegraph reported, multiple significant factors suggest the largest crytocurrency’s longer-term trajectory will take itfar pastprevious all-time highs.
• Bitcoin Breaks $200 Billion Market Cap For the First Time in 17 Months
• ETH Hits 10-Month High as Crypto Markets See Solid Green
• Bitcoin Breaks $9,300 as US Stock Market Sees Minor Uptrend
• Bitcoin Holds $9,100 Support While Top 20 Coins Trade Sideways |
BIS: Facebook’s Foray into Cryptocurrency Poses New Risks for Banks
The Bank of International Settlements(BIS) has warned that the financial services poised to be offered by big tech firms such as Facebook, Google and Amazon could generate new risks for the banking sector.
The BIS — an international financial institution in Switzerland owned by 60 of the world’s central banks —publishedareportoutlining its stance on June 23.
Hot on the heels of Facebook’s newly-announced cryptocurrency, Libra, the BIS said that while big tech firms’ foray into finance can bring efficiency gains and broaden financial inclusion, regulators must step up their action to mitigate the new and complex risks involved.
According to BIS, big tech firms’ extensive user base, access to user data and multi-faceted business models have the potential to rapidly change the financial services industry. Their low-cost structure business is highly scalable, and the network structure of widely-visited platforms can help promote financial inclusion in populations that remain underbanked, it notes.
Yet, the BIS warns, “the very features that bring benefits also have the potential to generate new risks and costs associated with market power.”
The BIS claims that big tech firms introduce both known — as well as new and unfamiliar — risks to the financial services landscape.
Among the established issues, it notes the risks to financial stability and consumer protection posed by tech giants that “have the potential to loom large very quickly as systemically relevant financial institutions” — thereby disrupting the traditional banking sector and existing structure of financial intermediation.
The report notes that such firms efficiently leverage a “data-network-activities loop” that could well accelerate the success of their entry into finance, yet this very business model raises new and unprecedented challenges for regulators — notably competition and data privacy issues.
Given that firms such as Facebook straddle traditional regulatory perimeters and national borders, the BIS calls for national and international coordination among authorities to “ensure a level playing field between big techs and banks.”
As previously reported,Facebookpublishedthe white paper for its long-awaitedcryptocurrencyand blockchain-based financial infrastructure project, Libra, on June 18.
International reactions to Libra have thus far been mixed, including ambivalentremarksfrom the Chair of theUnited StatesFederal Reserve, and a statement from the chairman of theRussianState Duma Committee on Financial Markets that the token will not be legalized in Russia.
The Governor of the ReserveBankofAustralia(RBA) has meanwhiledownplayedthe likelihood that Libra could attain wide-ranging usage before relevant regulatory issues are addressed.
• FT: Facebook Hires Standard Chartered Bank’s Head of Public Affairs for Crypto Project
• Former Trump Economic Adviser Expresses Support For Facebook’s Libra
• Facebook Adds Senior Job Vacancy for Calibra Wallet on Careers Site
• Australian Reserve Bank Official Advises Caution in Anticipation of Libra |
Should You Be Concerned About Icade's (EPA:ICAD) ROE?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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 Icade (EPA:ICAD).
Our data showsIcade has a return on equity of 4.7%for the last year. That means that for every €1 worth of shareholders' equity, it generated €0.047 in profit.
Check out our latest analysis for Icade
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Icade:
4.7% = €156m ÷ €3.9b (Based on the trailing twelve months to December 2018.)
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 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 amount earned after tax 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 ROE can be used to compare two businesses.
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. If you look at the image below, you can see Icade has a lower ROE than the average (8.0%) in the REITs industry classification.
Unfortunately, that's sub-optimal. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Nonetheless, it might be wise tocheck if insiders have been selling.
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 debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used.
It's worth noting the significant use of debt by Icade, leading to its debt to equity ratio of 1.60. The company doesn't have a bad ROE, but it is less than ideal tht it has had to use debt to achieve its returns. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it.
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 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. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
But note:Icade may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with 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. |
How Much Did Icade's (EPA:ICAD) CEO Pocket Last Year?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Olivier Wigniolle became the CEO of Icade (EPA:ICAD) in 2015. This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. Then we'll look at a snap shot of the business growth. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
View our latest analysis for Icade
Our data indicates that Icade is worth €5.9b, and total annual CEO compensation is €484k. (This number is for the twelve months until December 2018). That's a fairly small increase of 1.7% on year before. While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at €400k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of €3.5b to €11b. The median total CEO compensation was €2.5m.
A first glance this seems like a real positive for shareholders, since Olivier Wigniolle is paid less than the average total compensation paid by similar sized companies. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see a visual representation of the CEO compensation at Icade, below.
On average over the last three years, Icade has grown earnings per share (EPS) by 90% each year (using a line of best fit). It achieved revenue growth of 9.4% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Most shareholders would probably be pleased with Icade for providing a total return of 47% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.
It looks like Icade pays its CEO less than similar sized companies. Considering the underlying business is growing earnings, this would suggest the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Olivier Wigniolle deserves a raise!
It is relatively rare to see a modestly paid CEO when performance is so impressive. The cherry on top would be if company insiders are buying shares with their own money. If you think CEO compensation levels are interesting you will probably really likethis free visualization of insider trading at Icade.
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. |
Is It Too Late To Consider Buying Icade (EPA:ICAD)?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Icade ( EPA:ICAD ), which is in the reits business, and is based in France, saw its share price hover around a small range of €74.05 to €80.85 over the last few weeks. But is this actually reflective of the share value of the mid-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Icade’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 Icade Is Icade still cheap? Great news for investors – Icade is still trading at a fairly cheap price. My valuation model shows that the intrinsic value for the stock is €106.55, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Another thing to keep in mind is that Icade’s share price may be quite stable relative to the rest of the market, as indicated by its low beta. This means that if you believe the current share price should move towards its intrinsic value over time, a low beta could suggest it is not likely to reach that level anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range again. What does the future of Icade look like? ENXTPA:ICAD Past and Future Earnings, June 24th 2019 Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. 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 Icade, it is expected to deliver a negative earnings growth of -0.1%, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term. What this means for you: Are you a shareholder? Although ICAD is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. I recommend you think about whether you want to increase your portfolio exposure to ICAD, or whether diversifying into another stock may be a better move for your total risk and return. Story continues Are you a potential investor? If you’ve been keeping an eye on ICAD for a while, but hesitant on making the leap, I recommend you dig deeper into the stock. Given its current undervaluation, now is a great time to make a decision. But keep in mind the risks that come with negative growth prospects in the future. Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Icade. You can find everything you need to know about Icade in the latest infographic research report . If you are no longer interested in Icade, you can use our free platform to see my list of over 50 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 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. |
Hopes of budget reprieve lift Italian bond market
* Euro zone periphery govt bond yields http://tmsnrt.rs/2ii2Bqr
By Dhara Ranasinghe
LONDON, June 24 (Reuters) - Italy's government borrowing costs fell on Monday, following a report that the European Commission will hold off on disciplinary action over Rome's budget stance this week.
Bond yields across the bloc drifted down but the moves were tepid compared to some of the sizeable falls in recent weeks on heightened speculation that major central banks, including the European Central Bank, are gearing up for rate cuts.
Italy's bond market outperformed its peers, with yields across the curve around 5 basis points lower on the day. .
According to a report in the Financial Times, the Commission will hold off from taking action over Italy's rising debt levels, allowing more time for a compromise to be reached.
Italy's Deputy Prime Minister Matteo Salvini last week raised the stakes in the budget tussle with Brussels by threatening to resign and bring down the government unless he was able to push through at least 10 billion euros ($11 billion) of tax cuts.
"The fact that Salvini is willing to push ahead with tax cuts and there is turbulence in the coalition is not good news for Italy," said DZ Bank rates strategist Daniel Lenz.
"But the market is reacting more to the FT article today."
Italy's 10-year bond yield was down 5 bps at 2.11% , close to more than one-year lows hit last week.
That pushed the gap over safer German Bund yields to 240 bps , down from 243 bps on Friday.
Analysts said there were other reasons for the solid performance of Italian bonds.
For starters they offer some of the highest yields among major government bond markets. Expectations for ECB monetary easing soon are high, overshadowing Italy's domestic risks for now.
Expectations for an increase in fiscal spending across the bloc to support economic growth in the face of a global trade war also mean a budget compromise between Italy and the EU is likely.
Outside Italy, most 10-year bond yields were down 2-3 bps on the day, with markets again bolstered by expectations for monetary easing and as political risks supported demand for Bunds and other safe havens.
Germany's benchmark 10-year yield was down 2 bps at minus 0.30%, edging back towards record lows hit last week at around minus 0.33%. (Reporting by Dhara Ranasinghe; editing by John Stonestreet) |
Carrefour Sells Control of China Business at a Discount
(Bloomberg) -- Carrefour SA has agreed to sell an 80% stake in its China unit for 4.8 billion yuan ($698 million) in cash to local retailer Suning.com Co. as it rethinks its exposure in the world’s No. 2 economy after years of decline.
The yielding of control comes after a long search for a partner for the French company’s struggling Chinese operations. Once the premier foreign supermarket chain locally, it failed to adjust to the onslaught of e-commerce in recent years and sales slumped.
The shares rose as much as 2.9% early Monday in Paris.
Carrefour will retain a 20% stake in the China business, which generated net sales of 3.6 billion euros (28.5 billion yuan) in 2018. It will also get two seats out of seven on the China unit’s Supervisory Board, according to a statement Sunday.
The valuation of Carrefour’s China unit at 0.2 times its 2018 sales -- compared to an industry average of 0.8 times -- is at a “significant discount to peers likely due to poor financial results,” said Citigroup Inc. analysts led by Lydia Ling in a note Monday.
“The consolidation in store network, supply chain, logistics and membership could improve efficiency and profitability for both parties,” said the Citi note.
A growing number of European and American retailers are either scaling back their presence or tying up with local partners in order to stay competitive in China, where e-commerce penetration is one of the highest globally. Walmart Inc., which has a network of around 400 supermarkets, relies on JD.com Inc. for its delivery service, while Germany’s Metro AG is said to be trying to offload a majority stake in its Chinese business.
“The big problem for Carrefour and other western grocery chains is that they have major challenges in their home countries and can’t afford to grow in China,” said Pascal Martin, a Hong Kong-based partner at OC&C Strategy Consultants. “In China, if you want to grow in the groceries space, you have to continue to invest capital in less developed cities.”
End of an Era
It’s the end of an era for one of the first foreign brands to gain a loyal following among Chinese consumers. Carrefour entered the country in 1995, ahead of Walmart, and its massive hypermarkets where one could buy fresh pork along with a TV ushered in a new style of shopping for a country just opening up to the outside world.
But it has struggled to maintain profitability as buyers moved online rapidly in recent years, a shift that’s favored home-grown giants like Alibaba Group Holding Ltd. Despite efforts to digitize its operations, and an initiative to rent out store space to local retailer Gome Retail Holdings, Carrefour’s China sales declined about 10 percent last year to 3.6 billion euros, according to the company’s annual report.
Earnings before interest, tax, depreciation and amortization were 66 million euros or 516 million yuan last year. It operates 210 hypermarkets and 24 convenience stores in China currently.
The transaction represents an enterprise value of 1.4 billion euros ($1.6 billion) for Carrefour China.
For Nanjing-based Suning, primarily an electronics retailer, the deal will help it cut procurement and logistics costs and boost profitability, the company said in a statement Sunday. Its Shenzhen-listed shares rose as much as 6.5% in early trading on Monday as investors rewarded the retailer for closing the deal at a low price.
Alibaba holds a 20% stake in Suning and the two companies are closely allied. They’ve been investing in brick-and-mortar retailers with the goal of building an empire where offline and online shopping are seamlessly integrated. Earlier this year, Suning bought 37 department stores from Wanda Group, while Alibaba paid $2.9 billion in 2017 for a 36% stake in Sun Art Retail Group Ltd., China’s biggest supermarket chain. The Carrefour deal is likely to strengthen Alibaba’s foothold in the fiercely competitive groceries market in China.
The acquisition has been cleared by Carrefour’s board and is expected to close by year end, but still needs approval from the Chinese regulator, said the companies.
Carrefour’s decision to retain a 20% holding shows how China remains a strategic market for global retailers. Keeping that stake will allow it to maintain a foothold in an innovative retail market, a company spokeswoman said Sunday.
(Updates with shares in third paragraph.)
--With assistance from Robert Williams.
To contact Bloomberg News staff for this story: Geraldine Amiel in Paris at gamiel@bloomberg.net;Daniela Wei in Hong Kong at jwei74@bloomberg.net
To contact the editors responsible for this story: Rachel Chang at wchang98@bloomberg.net, Bhuma Shrivastava
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
How Does Hellenic Petroleum S.A. (ATH:ELPE) Fare As A Dividend Stock?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we'll take a closer look at Hellenic Petroleum S.A. (ATH:ELPE) from a dividend investor's perspective. Owning a strong business and reinvesting the dividends is widely seen as an attractive way of growing your wealth. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful.
With a nine-year payment history and a 5.7% yield, many investors probably find Hellenic Petroleum intriguing. It sure looks interesting on these metrics - but there's always more to the story . When buying stocks for their dividends, you should always run through the checks below, to see if the dividend looks sustainable.
Explore this interactive chart for our latest analysis on Hellenic Petroleum!
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. Looking at the data, we can see that 83% of Hellenic Petroleum's profits were paid out as dividends in the last 12 months. It's paying out most of its earnings, which limits the amount that can be reinvested in the business. This may indicate limited need for further capital within the business, or highlight a commitment to paying a dividend.
We also measure dividends paid against a company's levered free cash flow, to see if enough cash was generated to cover the dividend. Of the free cash flow it generated last year, Hellenic Petroleum paid out 34% as dividends, suggesting the dividend is affordable. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously.
As Hellenic Petroleum has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A quick way to check a company's financial situation uses these two ratios: net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments on debt. Essentially we check that a) a company does not have too much debt, and b) that it can afford to pay the interest. With net debt of more than twice its EBITDA, Hellenic Petroleum has a noticeable amount of debt, although if business stays steady, this may not be overly concerning.
We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. With EBIT of 3.27 times its interest expense, Hellenic Petroleum's interest cover is starting to look a bit thin.
Remember, you can always get a snapshot of Hellenic Petroleum's latest financial position,by checking our visualisation of its financial health.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. Looking at the last decade of data, we can see that Hellenic Petroleum paid its first dividend at least nine years ago. It's good to see that Hellenic Petroleum has been paying a dividend for a number of years. However, the dividend has been cut at least once in the past, and we're concerned that what has been cut once, could be cut again. During the past nine-year period, the first annual payment was €0.45 in 2010, compared to €0.50 last year. Dividends per share have grown at approximately 1.2% per year over this time. The dividends haven't grown at precisely 1.2% every year, but this is a useful way to average out the historical rate of growth.
It's good to see some dividend growth, but the dividend has been cut at least once, and the size of the cut would eliminate most of the growth, anyway. We're not that enthused by this.
With a relatively unstable dividend, it's even more important to evaluate if earnings per share (EPS) are growing - it's not worth taking the risk on a dividend getting cut, unless you might be rewarded with larger dividends in future. It's good to see Hellenic Petroleum has been growing its earnings per share at 59% a year over the past 5 years. Hellenic Petroleum earnings have been growing very quickly recently, but given that it is paying out more than half of its earnings, we wonder if it will have enough capital to fund further growth in the future.
To summarise, shareholders should always check that Hellenic Petroleum's dividends are affordable, that its dividend payments are relatively stable, and that it has decent prospects for growing its earnings and dividend. First, we think Hellenic Petroleum has an acceptable payout ratio and its dividend is well covered by cashflow. Next, earnings growth has been good, but unfortunately the dividend has been cut at least once in the past. Hellenic Petroleum has a number of positive attributes, but it falls slightly short of our (admittedly high) standards. Were there evidence of a strong moat or an attractive valuation, it could still be well worth a look.
Earnings growth generally bodes well for the future value of company dividend payments. See if the 8 Hellenic Petroleum analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company.
Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%.
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. |
Is It Too Late To Consider Buying Husqvarna AB (publ) (STO:HUSQ B)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Husqvarna AB (publ) (STO:HUSQ B), which is in the consumer durables business, and is based in Sweden, saw a double-digit share price rise of over 10% in the past couple of months on the OM. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Husqvarna’s outlook and valuation to see if the opportunity still exists.
View our latest analysis for Husqvarna
According to my valuation model, Husqvarna seems to be fairly priced at around 15% below my intrinsic value, which means if you buy Husqvarna today, you’d be paying a fair price for it. And if you believe the company’s true value is SEK102.27, then there isn’t much room for the share price grow beyond what it’s currently trading. Furthermore, Husqvarna’s low beta implies that the stock is less volatile than the wider market.
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. With profit expected to more than double over the next couple of years, the future seems bright for Husqvarna. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
Are you a shareholder?It seems like the market has already priced in HUSQ B’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?
Are you a potential investor?If you’ve been keeping tabs on HUSQ B, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Husqvarna. You can find everything you need to know about Husqvarna inthe latest infographic research report. If you are no longer interested in Husqvarna, 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. |
Is Hansard Global Plc (LON:HSD) A Good Dividend Stock?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Could Hansard Global Plc (LON:HSD) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful.
With Hansard Global yielding 9.7% and having paid a dividend for over 10 years, many investors likely find the company quite interesting. It would not be a surprise to discover that many investors buy it for the dividends. Some simple analysis can reduce the risk of holding Hansard Global for its dividend, and we'll focus on the most important aspects below.
Explore this interactive chart for our latest analysis on Hansard Global!
Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. In the last year, Hansard Global paid out 97% of its profit as dividends. Its payout ratio is quite high, and the dividend is not well covered by earnings. If earnings are growing or the company has a large cash balance, this might be sustainable - still, we think it is a concern.
Remember, you can always get a snapshot of Hansard Global's latest financial position,by checking our visualisation of its financial health.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. For the purpose of this article, we only scrutinise the last decade of Hansard Global's dividend payments. This dividend has been unstable, which we define as having fallen by at least 20% one or more times over this time. During the past ten-year period, the first annual payment was UK£0.13 in 2009, compared to UK£0.044 last year. The dividend has shrunk at around 9.9% a year during that period. Hansard Global's dividend has been cut sharply at least once, so it hasn't fallen by 9.9% every year, but this is a decent approximation of the long term change.
When a company's per-share dividend falls we question if this reflects poorly on either the business or management. Either way, we find it hard to get excited about a company with a declining dividend.
With a relatively unstable dividend, and a poor history of shrinking dividends, it's even more important to see if EPS are growing. Over the past five years, it looks as though Hansard Global's EPS have declined at around 9.6% a year. Declining earnings per share over a number of years is not a great sign for the dividend investor. Without some improvement, this does not bode well for the long term value of a company's dividend.
To summarise, shareholders should always check that Hansard Global's dividends are affordable, that its dividend payments are relatively stable, and that it has decent prospects for growing its earnings and dividend. We're a bit uncomfortable with its high payout ratio. Earnings per share have been falling, and the company has cut its dividend at least once in the past. From a dividend perspective, this is a cause for concern. With any dividend stock, we look for a sustainable payout ratio, steady dividends, and growing earnings. Hansard Global has a few too many issues for us to get interested.
You can also discover whether shareholders are aligned with insider interests bychecking our visualisation of insider shareholdings and trades in Hansard Global stock.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Is Hansard Global Plc (LON:HSD) A Good Dividend Stock?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Could Hansard Global Plc (LON:HSD) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful.
A high yield and a long history of paying dividends is an appealing combination for Hansard Global. It would not be a surprise to discover that many investors buy it for the dividends. Some simple analysis can reduce the risk of holding Hansard Global for its dividend, and we'll focus on the most important aspects below.
Click the interactive chart for our full dividend analysis
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Looking at the data, we can see that 97% of Hansard Global's profits were paid out as dividends in the last 12 months. With a payout ratio this high, we'd say its dividend is not well covered by earnings. This may be fine if earnings are growing, but it might not take much of a downturn for the dividend to come under pressure.
Consider gettingour latest analysis on Hansard Global's financial position here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. For the purpose of this article, we only scrutinise the last decade of Hansard Global's dividend payments. The dividend has been cut by more than 20% on at least one occasion historically. During the past ten-year period, the first annual payment was UK£0.13 in 2009, compared to UK£0.044 last year. The dividend has shrunk at around 9.9% a year during that period. Hansard Global's dividend hasn't shrunk linearly at 9.9% per annum, but the CAGR is a useful estimate of the historical rate of change.
A shrinking dividend over a ten-year period is not ideal, and we'd be concerned about investing in a dividend stock that lacks a solid record of growing dividends per share.
Given that dividend payments have been shrinking like a glacier in a warming world, we need to check if there are some bright spots on the horizon. Over the past five years, it looks as though Hansard Global's EPS have declined at around 9.6% a year. Declining earnings per share over a number of years is not a great sign for the dividend investor. Without some improvement, this does not bode well for the long term value of a company's dividend.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Hansard Global is paying out a larger percentage of its profit than we're comfortable with. Earnings per share have been falling, and the company has cut its dividend at least once in the past. From a dividend perspective, this is a cause for concern. In short, we're not keen on Hansard Global from a dividend perspective. Businesses can change, but we've spotted a few too many concerns with this one to get comfortable.
See if management have their own wealth at stake, by checking insider shareholdings inHansard Global stock.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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 Holding Honeywell Automation India Limited (NSE:HONAUT)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Honeywell Automation India Limited (NSE:HONAUT) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of HONAUT, it is a financially-robust company with a strong history and a excellent future outlook. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, take a look at thereport on Honeywell Automation India here.
In the previous year, HONAUT has ramped up its bottom line by 44%, with its latest earnings level surpassing its average level over the last five years. This strong performance generated a robust double-digit return on equity of 21%, which is an optimistic signal for the future.
HONAUT's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that HONAUT manages its cash and cost levels well, which is a key determinant of the company’s health. HONAUT currently has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is rather impressive for a ₹218b market cap company. HONAUT has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future.
For Honeywell Automation India, there are three essential factors you should further research:
1. Valuation: What is HONAUT 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 HONAUT is currently mispriced by the market.
2. Dividend Income vs Capital Gains: Does HONAUT return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Ourhistorical dividend yield visualizationquickly tells you what your can expect from HONAUT as an investment.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HONAUT? Exploreour interactive list of stocks with large 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. |
Did Changing Sentiment Drive H & M Hennes & Mauritz's (STO:HM B) Share Price Down By 49%?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Ideally, your overall portfolio should beat the market average. But even the best stock picker will only win withsomeselections. At this point some shareholders may be questioning their investment inH & M Hennes & Mauritz AB (publ)(STO:HM B), since the last five years saw the share price fall 49%. Unhappily, the share price slid 4.5% in the last week.
See our latest analysis for H & M Hennes & Mauritz
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
During the five years over which the share price declined, H & M Hennes & Mauritz's earnings per share (EPS) dropped by 7.0% each year. This reduction in EPS is less than the 13% annual reduction in the share price. This implies that the market was previously too optimistic about the stock.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
Dive deeper into H & M Hennes & Mauritz's key metrics by checking this interactive graph of H & M Hennes & Mauritz'searnings, revenue and cash flow.
It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for H & M Hennes & Mauritz the TSR over the last 5 years was -38%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!
We're pleased to report that H & M Hennes & Mauritz shareholders have received a total shareholder return of 13% over one year. And that does include the dividend. Notably the five-year annualised TSR loss of 9.1% per year compares very unfavourably with the recent share price performance. This makes us a little wary, but the business might have turned around its fortunes. Importantly, we haven't analysed H & M Hennes & Mauritz's dividend history. Thisfreevisual report on its dividendsis a must-read if you're thinking of buying.
Of courseH & M Hennes & Mauritz may not be the best stock to buy. So you may wish to see thisfreecollection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SE 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. |
Can We See Significant Institutional Ownership On The Instone Real Estate Group AG (ETR:INS) Share Register?
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 Instone Real Estate Group AG (ETR:INS), 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. Companies that used to be publicly owned tend to have lower insider ownership.
With a market capitalization of €762m, Instone Real Estate Group is a decent size, so it is probably on the radar of institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about INS.
See our latest analysis for Instone Real Estate Group
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.
As you can see, institutional investors own 68% of Instone Real Estate Group. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Instone Real Estate Group's historic earnings and revenue, below, but keep in mind there's always more to the story.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. We note that hedge funds don't have a meaningful investment in Instone Real Estate Group. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
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. 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.
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 most recent data indicates that insiders own less than 1% of Instone Real Estate Group AG. It has a market capitalization of just €762m, and the board has only €6.8m worth of shares in their own names. Many tend to prefer to see a board with bigger shareholdings. A good next step might be totake a look at this free summary of insider buying and selling.
With a 31% ownership, the general public have some degree of sway over INS. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
It's always worth thinking about the different groups who own shares in a company. But to understand Instone Real Estate Group better, we need to consider many other factors.
I always like to check for ahistory of revenue growth. You can too, by accessing this free chart ofhistoric revenue and earnings in thisdetailed graph.
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. |
Air of Caution in Markets Ahead of “major” US Sanctions, Trump-Xi Meeting
Open your FXTM account today
There’s an air of caution in the markets at the start of a week that’s bookended by new US sanctions on Iran and the meeting between US President Donald Trump and Chinese President Xi-Jinping. Asian stocks are seeing a mixed Monday morning, while futures for the S&P 500 remain steady, indicating that equity bulls are losing some momentum ahead of a crucial catalyst for risk sentiment.
The outcome from the Trump-Xi meeting promises significant implications for investors who are finalizing their outlooks for the second half of 2019. Markets are expecting to see whether the US-China brinkmanship will give way to a truce that could ease trade tensions, or if markets will still have to contend with the protracted standoff over the coming months.
While the Trump-Xi meeting is a meaningful step towards de-escalating tensions, markets could also be left disappointed if the high-stakes meeting yields naught, leaving the status quo of the heightened conflict intact. Such a risk suggests that investors would want to avoid getting ahead of themselves in anticipating a market-friendly outcome from the meeting.
BothBrentand WTI are climbing by over 0.6 and 0.8 percent respectively at the time of writing, after President Trump tweeted about placing “major additional sanctions on Iran” on Monday. This is stoking market concerns that heightened geopolitical tensions could ultimately weigh on the global supply of Oil. In the meantime, energy stocks in Japan and Australia are climbing higher, contrasting the losses in their respective benchmark equity indices.
Oil’s recent surge frames the OPEC+ meeting next week, as Oil producers face the delicate task of rebalancing Oil markets. While rising geopolitical tensions have been doing the legwork for OPEC+ in sending crude higher, the demand outlook remains plagued by uncertainties surrounding US-China trade tensions, which threatens to be a major drag on Oil consumption through the rest of 2019. Unless there’s a seismic shift in the supply-demand equation this week, the OPEC+ alliance may have little choice but to extend its supply cuts into the second half of the year, which should help support Oil prices.
Gold’sstay above the psychological $1400 mark highlights the cautionary tone across various asset classes on Monday. Rising geopolitical tensions as well as the uncertainty over the US-China standoff ensure those safe haven assets remains in a supportive environment for the time being.
While it’s hard to imagine US-led tensions melting away rapidly in the immediate-term, recent history has only demonstrated that the geopolitical landscape remains highly fluid and can turn on a dime. Still, any potential declines in Gold triggered by de-escalating in tensions over the near-term should be mitigated by the expressed easing bias out of major central banks.
Disclaimer:The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same.
Thisarticlewas originally posted on FX Empire
• U.S. Dollar Index Futures (DX) Technical Analysis – June 25, 2019 Forecast
• Why America is Falling, and When Italy Abandons the Euro
• USD just Gave Up
• EUR/USD Daily Forecast: Euro Eases Back From 3-Month High
• Keep an Eye on these High-Octane Markets
• Gold Goes Boom as High Trend Resistance is Bulldozed by Bulls |
Are Innovatec S.p.A.'s (BIT:INC) Interest Costs Too High?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
While small-cap stocks, such as Innovatec S.p.A. (BIT:INC) with its market cap of €8.1m, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Understanding the company's financial health becomes crucial, since poor capital management may bring about bankruptcies, which occur at a higher rate for small-caps. We'll look at some basic checks that can form a snapshot the company’s financial strength. Nevertheless, this is just a partial view of the stock, and I recommend youdig deeper yourself into INC here.
Over the past year, INC has reduced its debt from €23m to €8.8m – this includes long-term debt. With this debt repayment, INC currently has €7.8m remaining in cash and short-term investments , ready to be used for running the business. Additionally, INC has generated cash from operations of €2.8m in the last twelve months, resulting in an operating cash to total debt ratio of 31%, signalling that INC’s current level of operating cash is high enough to cover debt.
At the current liabilities level of €22m, it appears that the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.25x. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for Electrical companies, this is a reasonable ratio as there's enough of a cash buffer without holding too much capital in low return investments.
With a debt-to-equity ratio of 99%, INC can be considered as an above-average leveraged company. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. No matter how high the company’s debt, if it can easily cover the interest payments, it’s considered to be efficient with its use of excess leverage. A company generating earnings before interest and tax (EBIT) at least three times its net interest payments is considered financially sound. In INC's case, the ratio of 2.7x suggests that interest is not strongly covered, which means that lenders may be more reluctant to lend out more funding as INC’s low interest coverage already puts the company at higher risk of default.
Although INC’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. Since there is also no concerns around INC'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 INC has company-specific issues impacting its capital structure decisions. I recommend you continue to research Innovatec to get a better picture of the small-cap by looking at:
1. Valuation: What is INC 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 INC is currently mispriced by the market.
2. Historical Performance: What has INC'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. |
Why Intercede Group plc’s (LON:IGP) Return On Capital Employed Might Be A Concern
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we are going to look at Intercede Group plc (LON:IGP) to see whether it might be an attractive investment prospect. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires.
First of all, we'll work out how to calculate ROCE. Next, we'll compare it to others in its industry. Last but not least, we'll look at what impact its current liabilities have on its ROCE.
ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. All else being equal, a better business will have a higher ROCE. 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 Intercede Group:
0.0058 = UK£16k ÷ (UK£8.6m - UK£5.8m) (Based on the trailing twelve months to March 2019.)
Therefore,Intercede Group has an ROCE of 0.6%.
View our latest analysis for Intercede Group
ROCE can be useful when making comparisons, such as between similar companies. In this analysis, Intercede Group's ROCE appears meaningfully below the 9.6% average reported by the Software industry. This could be seen as a negative, as it suggests some competitors may be employing their capital more efficiently. Regardless of how Intercede Group stacks up against its industry, its ROCE in absolute terms is quite low (especially compared to a bank account). There are potentially more appealing investments elsewhere.
Intercede Group reported an ROCE of 0.6% -- better than 3 years ago, when the company didn't make a profit. This makes us wonder if the company is improving.
When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is, after all, simply a snap shot of a single year. Since the future is so important for investors, you should check out ourfreereport on analyst forecasts for Intercede Group.
Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. 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.
Intercede Group has total liabilities of UK£5.8m and total assets of UK£8.6m. As a result, its current liabilities are equal to approximately 68% of its total assets. Current liabilities of this level result in a meaningful boost to Intercede Group's ROCE.
Unfortunately, its ROCE is also pretty low, so we are cautious about the stock. You might be able to find a better investment than Intercede Group. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
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. |
Medtronic Announces Cash Tender Offers for up to $4.175 Billion of Outstanding Debt Securities Issued by Medtronic, Inc., Medtronic Global Holdings S.C.A. and Covidien International Finance S.A.
DUBLIN - June 24, 2019 -Medtronic plc (the "Company") (MDT) today announced the commencement of two cash tender offers by its wholly-owned indirect subsidiaries, Medtronic, Inc. ("Medtronic, Inc."), Medtronic Global Holdings S.C.A. ("MGH") and Covidien International Finance S.A. ("CIFSA" and, together with Medtronic, Inc. and MGH, the "Offerors"). The first tender offer (the "Any and All Tender Offer") is for any and all of $1.175 billion total aggregate principal amount of the outstanding senior notes listed in Table 1 below (the "Any and All Notes"), which were issued by Medtronic, Inc. The second tender offer (the "Maximum Tender Offer" and, together with the Any and All Tender Offer, the "Tender Offers") is for up to $3.0 billion (the "Aggregate Maximum Purchase Price") combined aggregate purchase price (excluding accrued and unpaid interest to, but not including, the applicable settlement date and excluding fees and expenses related to the Tender Offers) of the outstanding senior notes listed in Table 2 below (the "Maximum Tender Offer Notes" and, collectively with the Any and All Notes, the "Notes").
The tables below summarize certain information regarding the Notes and the Tender Offers, including the order of priority set forth in Table 2, subject to the Series Tender Caps, if applicable, and the Aggregate Maximum Purchase Price for the Maximum Tender Offer Notes. The Any and All Notes are not subject to a cap on the aggregate purchase price.
Table 1: Any and All Notes
[{"Title of Security": "4.125% Senior Notes due 2021", "CUSIPNumbers": "585055AV8", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$500,000,000", "U.S. TreasuryReferenceSecurity": "2.375% U.S.T. due 3/15/2021", "BloombergReference Page": "PX4", "Fixed Spread(1)": "15", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.125% Senior Notes due 2022", "CUSIPNumbers": "585055AX4", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$675,000,000", "U.S. TreasuryReferenceSecurity": "2.375% U.S.T. due 3/15/2022", "BloombergReference Page": "PX5", "Fixed Spread(1)": "15", "Early Tender Payment(2) (3)": "$30"}]
Table 2: Maximum Tender Offer Notes
[{"Title of Security": "6.500% Senior Notes due 2039", "CUSIPNumbers": "585055AQ9", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$182,949,000", "AcceptancePriorityLevel(4)": "1", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "85", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "5.550% Senior Notes due 2040", "CUSIPNumbers": "585055AT3", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$305,910,000", "AcceptancePriorityLevel(4)": "2", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "75", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "4.625% Senior Notes due 2045", "CUSIPNumbers": "585055BU9", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$1,963,341,000", "AcceptancePriorityLevel(4)": "3", "Series Tender Cap": "$100,000,000", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "70", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "4.625% Senior Notes due 2044", "CUSIPNumbers": "585055BD7", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$176,594,000", "AcceptancePriorityLevel(4)": "4", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "75", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "4.500% Senior Notes due 2042", "CUSIPNumbers": "585055AW6", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$128,650,000", "AcceptancePriorityLevel(4)": "5", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "75", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "4.375% Senior Notes due 2035", "CUSIPNumbers": "585055BT2", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$2,381,619,000", "AcceptancePriorityLevel(4)": "6", "Series Tender Cap": "$200,000,000", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "50", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "4.000% Senior Notes due 2043", "CUSIPNumbers": "585055AY2", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$325,024,000", "AcceptancePriorityLevel(4)": "7", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "75", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.500% Senior Notes due 2025", "CUSIPNumbers": "585055BS4", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$4,000,000,000", "AcceptancePriorityLevel(4)": "8", "Series Tender Cap": "$1,300,000,000", "U.S. TreasuryReferenceSecurity": "2.000% U.S.T. due 5/31/2024", "BloombergReference Page": "PX1", "Fixed Spread": "40", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.625% Senior Notes due 2024", "CUSIPNumbers": "585055BC9", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$850,000,000", "AcceptancePriorityLevel(4)": "9", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "2.000% U.S.T. due 5/31/2024", "BloombergReference Page": "PX1", "Fixed Spread": "35", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "6.550% Senior Notes due 2037", "CUSIPNumbers": "22303QAH3", "Issuer/Offeror": "Covidien International Finance S.A.", "Principal AmountOutstanding": "$283,536,000", "AcceptancePriorityLevel(4)": "10", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "3.000% U.S.T. due 2/15/2049", "BloombergReference Page": "PX1", "Fixed Spread": "75", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.350% Senior Notes due 2027", "CUSIPNumbers": "58507LAC3", "Issuer/Offeror": "Medtronic Global Holdings S.C.A.", "Principal AmountOutstanding": "$850,000,000", "AcceptancePriorityLevel(4)": "11", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "2.375% U.S.T. due 5/15/2029", "BloombergReference Page": "PX1", "Fixed Spread": "30", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.150% Senior Notes due 2022", "CUSIPNumbers": "585055BR6", "Issuer/Offeror": "Medtronic, Inc.", "Principal AmountOutstanding": "$2,500,000,000", "AcceptancePriorityLevel(4)": "12", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "1.750% U.S.T. due 6/15/2022", "BloombergReference Page": "PX1", "Fixed Spread": "25", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "3.200% Senior Notes due 2022", "CUSIPNumbers": "22303QAN0", "Issuer/Offeror": "Covidien International Finance S.A.", "Principal AmountOutstanding": "$650,000,000", "AcceptancePriorityLevel(4)": "13", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "1.750% U.S.T. due 6/15/2022", "BloombergReference Page": "PX1", "Fixed Spread": "25", "Early Tender Payment(2) (3)": "$30"}, {"Title of Security": "2.950% Senior Notes due 2023", "CUSIPNumbers": "22303QAP5", "Issuer/Offeror": "Covidien International Finance S.A.", "Principal AmountOutstanding": "$309,516,000", "AcceptancePriorityLevel(4)": "14", "Series Tender Cap": "N/A", "U.S. TreasuryReferenceSecurity": "2.000% U.S.T. due 5/31/2024", "BloombergReference Page": "PX1", "Fixed Spread": "25", "Early Tender Payment(2) (3)": "$30"}]
(1) If the Total Consideration (as defined below) based on the applicable Fixed Spread (as defined below) would have been below $1,000, then it will be equal to $1,000 per $1,000 principal amount.
(2) Per $1,000 principal amount.
(3) The Total Consideration for Notes validly tendered prior to or at the applicable Early Tender Date (as defined below) and accepted for purchase is calculated using the applicable Fixed Spread and is inclusive of the applicable Early Tender Payment (as defined below). The Total Consideration will be determined by taking into account the applicable par call date for each series of Notes, if any.
(4) The offers with respect to the Maximum Tender Offer Notes are subject to the Aggregate Maximum Purchase Price of $3.0 billion in aggregate purchase price and the Series Tender Caps. All references to the aggregate purchase price for the Maximum Tender Offer Notes include the applicable Total Consideration or Tender Offer Consideration (as defined below) and exclude applicable accrued interest and fees and expenses related to the Tender Offers. The Offerors will purchase an aggregate principal amount of Maximum Tender Offer Notes having an aggregate purchase price up to the Aggregate Maximum Purchase Price, subject to the Acceptance Priority Level and the Series Tender Caps as set forth in the table above. The Offerors reserve the right, but are under no obligation, to increase the Aggregate Maximum Purchase Price and/or any Series Tender Cap at any time, including on or after July 10, 2019, subject to applicable law, which could result in the Offerors purchasing an aggregate principal amount of Maximum Tender Offer Notes having a greater aggregate purchase price in the Maximum Tender Offers and/or purchasing an aggregate principal amount of such series of Capped Notes (as defined below) above the applicable sublimit set forth herein.
The Tender Offers are being made pursuant to an Offer to Purchase, dated June 24, 2019 (the "Offer to Purchase"), which sets forth the terms and conditions of the Tender Offers. The Tender Offers will expire at 12:00 midnight, New York City time, on July 24, 2019 (one minute after 11:59 p.m., New York City time, on July 24, 2019), or any other date and time to which such Tender Offer is extended (such date and time, as it may be extended with respect to a Tender Offer, the "Expiration Date"), unless earlier terminated. Holders of Notes must validly tender and not validly withdraw their Notes prior to 5:00 p.m., New York City time, on July 9, 2019, (such date and time, as it may be extended with respect to a Tender Offer, the "Early Tender Date"), to be eligible to receive the Total Consideration (as defined below), which is inclusive of the applicable cash amount set forth in the above tables under the heading "Early Tender Payment" (the "Early Tender Payment"). Holders of Notes who validly tender their Notes after the Early Tender Date but prior to the applicable Expiration Date will only be eligible to receive the applicable Tender Offer Consideration.
All holders of Notes accepted for purchase will also receive accrued and unpaid interest on Notes validly tendered and accepted for purchase from the applicable last interest payment date up to, but not including, the applicable settlement date.
The applicable consideration (the "Total Consideration") offered per $1,000 principal amount of Notes of each series validly tendered and accepted for purchase pursuant to the applicable Tender Offer will be determined in the manner described in the Offer to Purchase by reference to the applicable "Fixed Spread" for such Notes specified in the tables above plus the applicable yield to maturity based on the bid-side price of the applicable "U.S. Treasury Reference Security" specified in the tables above as quoted on the applicable page on the Bloomberg Bond Trader at 11:00 a.m., New York City time, on the first business day following the Early Tender Date which is expected to be July 10, 2019. The "Tender Offer Consideration" is equal to the Total Consideration minus the Early Tender Payment.
Maximum Tender Offer Notes tendered prior to or at the Early Tender Date and accepted for purchase will be accepted based on the acceptance priority levels noted on the front cover hereof, with 1 being the highest Acceptance Priority Level and 14 being the lowest Acceptance Priority Level (the "Acceptance Priority Levels") and will have priority over Maximum Tender Offer Notes tendered after the Early Tender Date, regardless of the Acceptance Priority Levels of the Maximum Tender Offer Notes tendered after the Early Tender Date. Maximum Tender Offer Notes of a series may be subject to proration if the aggregate principal amount of the Maximum Tender Offer Notes of such series validly tendered and not validly withdrawn would cause the Aggregate Maximum Purchase Price to be exceeded, or, in the case of each of the 4.625% Senior Notes due 2045, the 4.375% Senior Notes due 2035 and the 3.500% Senior Notes due 2025 (each a "Capped Note"), if the aggregate principal amount of the Capped Note validly tendered and not validly withdrawn is greater than applicable Series Tender Cap.
The Tender Offers will expire on the applicable Expiration Date. The settlement date for the Notes that are validly tendered on or prior to the Early Tender Date is expected to be July 12, 2019, the third business day following the Early Tender Date, assuming the conditions to the satisfaction of the applicable Tender Offer are satisfied. The settlement date for Notes that are validly tendered following the Early Tender Date but on or prior to the applicable Expiration Date is expected to be July 26, 2019, the second business day following the Expiration Date.
Notes that are validly tendered may be validly withdrawn at any time prior to 5:00 p.m., New York City time, on July 9, 2019 (unless extended, the "Withdrawal Deadline"). After such time Notes may not be withdrawn unless the applicable Offeror extends the Withdrawal Deadline.
In accordance with the indentures governing the Any and All Notes, and subject to available funding, Medtronic, Inc. may give notice of redemption for the redemption of any remaining 4.125% Senior Notes due 2021 or 3.125% Senior Notes due 2022 that are not validly tendered and accepted for purchase in the Any and All Tender Offers. Any such notice of redemption may be given as early as July 10, 2019. The Offerors, the Company or their affiliates may also from time to time, after completion of the applicable Tender Offer, purchase additional Notes in the open market, in privately negotiated transactions, through tender or exchange offers or otherwise, or the applicable Offeror may redeem Notes that are redeemable pursuant to their terms.
The Offerors` obligation to accept for payment and to pay for the Notes validly tendered in the Tender Offers is not subject to any minimum tender condition but is subject to the satisfaction or waiver of the conditions described in the Offer to Purchase, including the financing condition that the Offerors shall have closed one or more debt financings resulting in net proceeds in an amount not less than the amount required, upon the terms and subject to the conditions of the applicable Tender Offer, to purchase all the Notes validly tendered and accepted for purchase in the Tender Offers and to pay accrued interest thereon and fees and expenses associated therewith. Following the Tender Offers, the Company does not intend to pursue any additional opportunistic refinancing in the Euro market for the next year. The Offerors reserve the right, subject to applicable law, to: (i) waive any and all conditions to the Tender Offers; (ii) extend or terminate the Tender Offers; (iii) increase or decrease the Aggregate Maximum Purchase Price and Series Tender Caps; or (iv) otherwise amend any of the Tender Offers in any respect.
Information Relating to the Tender OffersBarclays Capital Inc., BofA Merrill Lynch and Goldman Sachs & Co. LLC are acting as the dealer managers (the "Dealer Managers") for the Tender Offers. The information agent and tender agent is Global Bondholder Services Corporation ("Global Bondholder"). Copies of the Offer to Purchase and related offering materials are available by contacting Global Bondholder at +1-866-470-4200 (U.S. toll-free) or +1-212-430-3774 (banks and brokers). Questions regarding the Tender Offer should be directed to Barclays Capital Inc., Liability Management Group at +1-212-528-7581 (collect) or +1-800-438-3242 (toll free), BofA Merrill Lynch, Liability Management Group, at +1-980-387-3907 (collect) or +1-888-292-0070 (toll-free) or Goldman Sachs & Co. LLC at +1-212-357-0215 (collect) or +1-800-828-3182 (toll-free).
None of the Offerors, the Company or their affiliates, their respective boards of directors or managing members, the Dealer Managers, Global Bondholder or the trustee with respect to any series of Notes is making any recommendation as to whether holders of Notes should tender any Notes in response to any of the Tender Offers, and neither the Offerors nor any such other person has authorized any person to make any such recommendation. Holders of Notes must make their own decision as to whether to tender any of their Notes, and, if so, the principal amount of Notes to tender.
This press release shall not constitute an offer to sell, a solicitation to buy or an offer to purchase or sell any securities. The Tender Offers are being made only pursuant to the Offer to Purchase and only in such jurisdictions as is permitted under applicable law.
The full details of the Tender Offers, including complete instruction on how to tender Notes, are included in the Offer to Purchase. The Offer to Purchase contains important information that should be read by holders of Notes before making a decision to tender any Notes. The Offer to Purchase may be downloaded from Global Bondholder`s website athttp://www.gbsc-usa.com/Medtronic/or obtained from Global Bondholder, free of charge, by calling toll-free at +1-866-470-4200 (bankers and brokers can call collect at +1-212-430-3774).
About MedtronicMedtronic plc (www.medtronic.com), headquartered in Dublin, Ireland, is among the world`s largest medical technology, services and solutions companies - alleviating pain, restoring health and extending life for millions of people around the world. Medtronic employs more than 90,000 people worldwide, serving physicians, hospitals and patients in more than 150 countries. The company is focused on collaborating with stakeholders around the world to take healthcare Further, Together.
This press release contains forward-looking statements that are not historical in nature. Such forward-looking statements are subject to risks and uncertainties, including the risks related to the acceptance of any tendered Notes, the expiration and settlement of the Tender Offers, the satisfaction of conditions to the Tender Offers, whether the Tender Offers will be consummated in accordance with terms set forth in the Offer to Purchase or at all and the timing of any of the foregoing, competitive factors, difficulties and delays inherent in the development, manufacturing, marketing and sale of medical products, government regulation and general economic conditions and other risks and uncertainties described in the Company`s periodic reports on file with the U.S. Securities and Exchange Commission including the most recent Annual Report on Form 10-K of the Company, as filed with the U.S. Securities and Exchange Commission. In some cases, you can identify these statements by forward-looking words, such as "anticipate," "believe," "could," "estimate," "expect," "forecast," "intend," "looking ahead," "may," "plan," "possible," "potential," "project," "should," "will," and similar words or expressions, the negative or plural of such words or expressions and other comparable terminology. Actual results may differ materially from anticipated results. None of Medtronic plc, MGH, Medtronic, Inc., or Covidien International Finance, S.A. undertakes to update its forward-looking statements or any of the information contained in this press release, including to reflect future events or circumstances.
-end-
Contacts:Francesca DeMartinoPublic Relations+1-763-505-2029Ryan WeispfenningInvestor Relations+1-763-505-4626
This announcement is distributed by West Corporation on behalf of West Corporation clients.The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.Source: Medtronic plc via GlobeNewswireHUG#2246386 |
Does HSBC Holdings (LON:HSBA) Deserve A Spot On Your Watchlist?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks with a good story, even if those businesses lose money. But as Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.'
So if you're like me, you might be more interested in profitable, growing companies, likeHSBC Holdings(LON:HSBA). Even if the shares are fully valued today, most capitalists would recognize its profits as the demonstration of steady value generation. 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.
View our latest analysis for HSBC Holdings
The market is a voting machine in the short term, but a weighing machine in the long term, so share price follows earnings per share (EPS) eventually. That makes EPS growth an attractive quality for any company. HSBC Holdings managed to grow EPS by 5.9% per year, over three years. That might not be particularly high growth, but it does show that per-share earnings are moving steadily in the right direction.
Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. Not all of HSBC Holdings'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. HSBC Holdings maintained stable EBIT margins over the last year, all while growing revenue 4.0% to US$52b. That's progress.
You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.
Of course the knack is to find stocks that have their best days in the future, not in the past. You could base your opinion on past performance, of course, but you may also want tocheck this interactive graph of professional analyst EPS forecasts for HSBC Holdings.
Since HSBC Holdings has a market capitalization of US$131b, we wouldn't expect insiders to hold a large percentage of shares. But we are reassured by the fact they have invested in the company. Indeed, they have a glittering mountain of wealth invested in it, currently valued at US$102m. I would find that kind of skin in the game quite encouraging, if I owned shares, since it would ensure that the leaders of the company would also experience my success, or failure, with the stock.
One positive for HSBC Holdings is that it is growing EPS. That's nice to see. Just as polish makes silverware pop, the high level of insider ownership enhances my enthusiasm for this growth. The combination sparks joy for me, so I'd consider keeping the company on a watchlist. Now, you could try to make up your mind on HSBC Holdings by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry.
Although HSBC Holdings certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
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. |
Here's Why I Think HSBC Holdings (LON:HSBA) Might Deserve Your Attention Today
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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. And in their study titledWho Falls Prey to the Wolf of Wall Street?'Leuz et. al. found that it is 'quite common' for investors to lose money by buying into 'pump and dump' schemes.
In contrast to all that, I prefer to spend time on companies likeHSBC Holdings(LON:HSBA), which has not only revenues, but also profits. Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. Loss-making companies are always racing against time to reach financial sustainability, but time is often a friend of the profitable company, especially if it is growing.
See our latest analysis for HSBC Holdings
If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. It's no surprise, then, that I like to invest in companies with EPS growth. HSBC Holdings managed to grow EPS by 5.9% per year, over three years. That might not be particularly high growth, but it does show that per-share earnings are moving steadily in the right direction.
I like to see top-line growth as an indication that growth is sustainable, and I look for a high earnings before interest and taxation (EBIT) margin to point to a competitive moat (though some companies with low margins also have moats). I note that HSBC Holdings's revenuefrom operationswas lower than its revenue in the last twelve months, so that could distort my analysis of its margins. HSBC Holdings maintained stable EBIT margins over the last year, all while growing revenue 4.0% to US$52b. That's progress.
You can take a look at the company's revenue and earnings growth trend, in the chart below. To see the actual numbers, click on the chart.
You don't drive with your eyes on the rear-view mirror, so you might be more interested in thisfreereport showing analyst forecasts for HSBC Holdings'sfutureprofits.
We would not expect to see insiders owning a large percentage of a US$131b company like HSBC Holdings. But we do take comfort from the fact that they are investors in the company. Indeed, they have a glittering mountain of wealth invested in it, currently valued at US$102m. This suggests to me that leadership will be very mindful of shareholders' interests when making decisions!
One important encouraging feature of HSBC Holdings is that it is growing profits. If that's not enough on its own, there is also the rather notable levels of insider ownership. That combination appeals to me, for one. So yes, I do think the stock is worth keeping an eye on. Of course, just because HSBC Holdings 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.
Although HSBC Holdings certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
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. |
Vietnam jails American for 12 years on charge of attempting to overthrow state
HANOI (Reuters) - A court in Vietnam on Monday sentenced a U.S. citizen to 12 years in prison after finding him guilty of "attempting to overthrow the state" in a trial that lasted just half a day, his lawyer said. Michael Phuong Minh Nguyen, 55, pleaded guilty, but had asked that his sentence be reduced so he could be reunited with his family, his lawyer, Nguyen Van Mieng, told Reuters by telephone after the trial at the Ho Chi Minh City court. Nguyen will be deported after serving his jail sentence. "It's such a long sentence," said Mieng. "Michael admitted guilt at the trial and asked the jury to reduce his sentence so that he could soon reunite with his family." Nguyen was accused of inciting Vietnamese people to join protests and attempting to attack government offices in Hanoi and Ho Chi Minh City with Molotov cocktails and slingshots, the Tuoi Tre newspaper said, citing the indictment. "We are disappointed by today's verdict," a spokeswoman for the U.S. Embassy in Hanoi said in an emailed statement. "We will continue to raise our concerns regarding Mr. Nguyen’s case, and his welfare, at all appropriate levels." Nguyen, who was born in Vietnam and has lived in the United States since he was a child, was detained in Vietnam in July 2018 on suspicion of activity against the government, said his brother-in-law, Mark Roberts. In February, Nguyen's wife, Helen, attended U.S. President Donald Trump's State of the Union speech in Washington. She was a guest of U.S. Representative Katie Porter, a Democrat who represents part of Orange County, California, where the Nguyen family lives. "I'm disappointed with this outcome, and my heart aches for the Nguyen family and for our Orange County community," Porter said in a statement. "I remain committed to supporting Helen and her daughters at this difficult time." Despite sweeping economic reform and increasing openness to social change, Vietnam's ruling Communist Party retains tight media censorship and does not tolerate criticism. Story continues The court also sentenced two Vietnamese men to eight years and 10 years in prison for the same offence, Mieng said, adding they would face three years' house arrest after their jail terms. "Their objective is to cause riots in an attempt to overthrow the administration of Vietnam and eradicate the leading role of the (Communist) party," Truoi Tre cited the indictment as saying. (Reporting by Khanh Vu; Additional reporting by James Pearson and Alex Dobuzinskis; Editing by Michael Perry and Peter Cooney) |
Why You Should Care About Heidelberger Druckmaschinen Aktiengesellschaft’s (FRA:HDD) Low Return On Capital
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we are going to look at Heidelberger Druckmaschinen Aktiengesellschaft (FRA:HDD) to see whether it might be an attractive investment prospect. 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, we'll go over how we calculate ROCE. Then we'll compare its ROCE to similar companies. Then we'll determine how its current liabilities are affecting its ROCE.
ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business. Generally speaking a higher ROCE is better. Overall, it is a valuable metric that has its flaws. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
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 Heidelberger Druckmaschinen:
0.063 = €94m ÷ (€2.3b - €834m) (Based on the trailing twelve months to March 2019.)
Therefore,Heidelberger Druckmaschinen has an ROCE of 6.3%.
View our latest analysis for Heidelberger Druckmaschinen
One way to assess ROCE is to compare similar companies. We can see Heidelberger Druckmaschinen's ROCE is meaningfully below the Machinery industry average of 10%. This performance is not ideal, as it suggests the company may not be deploying its capital as effectively as some competitors. Separate from how Heidelberger Druckmaschinen stacks up against its industry, its ROCE in absolute terms is mediocre; relative to the returns on government bonds. Investors may wish to consider higher-performing investments.
When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company.
Liabilities, such as supplier bills and bank overdrafts, are referred to as current liabilities if they need to be paid within 12 months. Due to the way ROCE is calculated, a high level of current liabilities makes a company look as though it has less capital employed, and thus can (sometimes unfairly) boost the ROCE. To counteract this, we check if a company has high current liabilities, relative to its total assets.
Heidelberger Druckmaschinen has total assets of €2.3b and current liabilities of €834m. Therefore its current liabilities are equivalent to approximately 36% of its total assets. Heidelberger Druckmaschinen's ROCE is improved somewhat by its moderate amount of current liabilities.
Unfortunately, its ROCE is still uninspiring, and there are potentially more attractive prospects out there. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
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. |
China says FedEx should offer a proper explanation on Huawei
BEIJING (Reuters) - China's foreign ministry said on Monday that FedEx Corp should offer a proper explanation, after the firm apologized for refusing to ship a Huawei Technologies phone sent from Britain to the United States.
Ministry spokesman Geng Shuang made the comment at a daily news briefing in Beijing.
FedEx had apologized saying it was an "operational error" after PC Magazine, an American computer magazine, said on Friday FedEx refused to ship the phone.
(Reporting by Huizhong Wu; Writing by Ben Blanchard) |
Should We Worry About Heidelberger Druckmaschinen Aktiengesellschaft's (FRA:HDD) P/E Ratio?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). We'll show how you can use Heidelberger Druckmaschinen Aktiengesellschaft's (FRA:HDD) P/E ratio to inform your assessment of the investment opportunity.Heidelberger Druckmaschinen has a price to earnings ratio of 18.78, based on the last twelve months. That corresponds to an earnings yield of approximately 5.3%.
View our latest analysis for Heidelberger Druckmaschinen
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for Heidelberger Druckmaschinen:
P/E of 18.78 = €1.4 ÷ €0.075 (Based on the trailing twelve months to March 2019.)
The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. That is not a good or a bad thingper se, but a high P/E does imply buyers are optimistic about the future.
If earnings fall then in the future the 'E' will be lower. That means unless the share price falls, the P/E will increase in a few years. Then, a higher P/E might scare off shareholders, pushing the share price down.
In the last year, Heidelberger Druckmaschinen grew EPS like Taylor Swift grew her fan base back in 2010; the 51% gain was both fast and well deserved. The sweetener is that the annual five year growth rate of 37% is also impressive. With that kind of growth rate we would generally expect a high P/E ratio. Unfortunately, earnings per share are down 12% a year, over 3 years.
We can get an indication of market expectations by looking at the P/E ratio. As you can see below, Heidelberger Druckmaschinen has a higher P/E than the average company (16.3) in the machinery industry.
Its relatively high P/E ratio indicates that Heidelberger Druckmaschinen shareholders think it will perform better than other companies in its industry classification. Shareholders are clearly optimistic, but the future is always uncertain. So investors should delve deeper. I like to checkif company insiders have been buying or selling.
Don't forget that the P/E ratio considers market capitalization. Thus, the metric does not reflect cash or debt held by the company. The exact same company would hypothetically deserve a higher P/E ratio if it had a strong balance sheet, than if it had a weak one with lots of debt, because a cashed up company can spend on growth.
Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio.
Heidelberger Druckmaschinen's net debt is 59% of its market cap. If you want to compare its P/E ratio to other companies, you should absolutely keep in mind it has significant borrowings.
Heidelberger Druckmaschinen's P/E is 18.8 which is about average (20.1) in the DE market. It does have enough debt to add risk, although earnings growth was strong in the last year. The P/E suggests that the market is not convinced EPS will continue to improve strongly.
When the market is wrong about a stock, it gives savvy investors an opportunity. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. So thisfreevisualization of the analyst consensus on future earningscould help you make theright decisionabout whether to buy, sell, or hold.
Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Don't Sell Heidelberger Druckmaschinen Aktiengesellschaft (FRA:HDD) Before You Read This
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Heidelberger Druckmaschinen Aktiengesellschaft's (FRA:HDD), to help you decide if the stock is worth further research. Looking at earnings over the last twelve months,Heidelberger Druckmaschinen has a P/E ratio of 18.78. That means that at current prices, buyers pay €18.78 for every €1 in trailing yearly profits.
Check out our latest analysis for Heidelberger Druckmaschinen
Theformula for price to earningsis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for Heidelberger Druckmaschinen:
P/E of 18.78 = €1.4 ÷ €0.075 (Based on the year to March 2019.)
A higher P/E ratio means that investors are payinga higher pricefor each €1 of company earnings. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.'
If earnings fall then in the future the 'E' will be lower. Therefore, even if you pay a low multiple of earnings now, that multiple will become higher in the future. A higher P/E should indicate the stock is expensive relative to others -- and that may encourage shareholders to sell.
Heidelberger Druckmaschinen's 51% EPS improvement over the last year was like bamboo growth after rain; rapid and impressive. The cherry on top is that the five year growth rate was an impressive 37% per year. With that kind of growth rate we would generally expect a high P/E ratio. On the other hand, the longer term performance is poor, with EPS down -37% per year over 3 years.
The P/E ratio essentially measures market expectations of a company. As you can see below, Heidelberger Druckmaschinen has a higher P/E than the average company (16.3) in the machinery industry.
Heidelberger Druckmaschinen's P/E tells us that market participants think the company will perform better than its industry peers, going forward. Clearly the market expects growth, but it isn't guaranteed. So further research is always essential. I often monitordirector buying and selling.
It's important to note that the P/E ratio considers the market capitalization, not the enterprise value. In other words, it does not consider any debt or cash that the company may have on the balance sheet. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth.
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
Heidelberger Druckmaschinen's net debt is 59% of its market cap. If you want to compare its P/E ratio to other companies, you should absolutely keep in mind it has significant borrowings.
Heidelberger Druckmaschinen's P/E is 18.8 which is about average (20.1) in the DE market. The significant levels of debt do detract somewhat from the strong earnings growth. However, the P/E ratio implies that most doubt the strong growth will continue.
Investors have an opportunity when market expectations about a stock are wrong. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock.
You might be able to find a better buy than Heidelberger Druckmaschinen. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).
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. |
A Spotlight On Heidelberger Druckmaschinen Aktiengesellschaft's (FRA:HDD) Fundamentals
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Heidelberger Druckmaschinen Aktiengesellschaft (FRA:HDD), it is a company with a an impressive track record of performance, trading at a great value. Below, I've touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, read the fullreport on Heidelberger Druckmaschinen here.
Over the past year, HDD has grown its earnings by 54%, with its most recent figure exceeding its annual average over the past five years. Not only did HDD outperformed its past performance, its growth also surpassed the Machinery industry expansion, which generated a -5.8% earnings growth. This is what investors like to see! HDD's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of HDD's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the market, HDD is also trading below other listed companies on the DE stock exchange, relative to earnings generated. This further reaffirms that HDD is potentially undervalued.
For Heidelberger Druckmaschinen, there are three key factors you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for HDD’s future growth? Take a look at ourfree research report of analyst consensusfor HDD’s outlook.
2. Financial Health: Are HDD’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 Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HDD? Exploreour interactive list of stocks with large 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. |
Boots is scrapping plastic bags from every UK store
Boots Store on Oxford Street. Photo by Amer Ghazzal / SOPA Images/Sipa USA Boots will scrap all plastic bags from its stores from next year, the company has announced. The retailer has begun to phase out plastic bags from today, starting in 53 stores across the UK. The pharmacy and beauty chain says it hopes to take 900 tonnes of plastic out of use as its managing director highlighted the Blue Planet effect in raising awareness of plastic pollution. Paper bags will be offered instead, with the recycled brown bags costing 5p, 7p or 10p depending on size. The firm, owned by US firm Walgreens Boots Alliance ( WBA ), said profits will go to BBC Children in Need. READ MORE: David Attenboroughs stark four-word message to world leaders Seb James, managing director of Boots, said: Plastic waste is undoubtedly one of the most important issues around the world today with TV shows like Blue Planet highlighting the effects of plastic pollution
the move to unbleached paper bags is another pivotal moment in that journey. There is no doubt that our customers expect us to act and this change signifies a huge step away from our reliance on plastic. Helen Normoyle, director of marketing at Boots, added: Our new paper bags have been carefully tested to make sure that, over their entire lifecycle, they are better for the environment, whilst still being a sturdy, practical option for customers who havent brought their own bags with them when shopping. |
Should You Consider Heidelberger Druckmaschinen Aktiengesellschaft (FRA:HDD)?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Heidelberger Druckmaschinen Aktiengesellschaft (FRA:HDD) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of HDD, it is a company with a a strong track record of performance, trading at a discount. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the fullreport on Heidelberger Druckmaschinen here.
Over the past year, HDD has grown its earnings by 54%, with its most recent figure exceeding its annual average over the past five years. Not only did HDD outperformed its past performance, its growth also exceeded the Machinery industry expansion, which generated a -5.8% earnings growth. This is an optimistic signal for the future. HDD is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts' consensus forecast growth be correct. Compared to the rest of the market, HDD is also trading below other listed companies on the DE stock exchange, relative to earnings generated. This bolsters the proposition that HDD's price is currently discounted.
For Heidelberger Druckmaschinen, I've compiled three important aspects you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for HDD’s future growth? Take a look at ourfree research report of analyst consensusfor HDD’s outlook.
2. Financial Health: Are HDD’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 Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HDD? Exploreour interactive list of stocks with large 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. |
Shareholders Are Loving Jay Bharat Maruti Limited's (NSE:JAYBARMARU) 1.3% Yield
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Is Jay Bharat Maruti Limited (NSE:JAYBARMARU) a good dividend stock? How would you know? Dividend paying companies with growing earnings can be highly rewarding in the long term. Unfortunately, it's common for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments.
With a 1.3% yield and a nine-year payment history, investors probably think Jay Bharat Maruti looks like a reliable dividend stock. A 1.3% yield is not inspiring, but the longer payment history has some appeal. Some simple research can reduce the risk of buying Jay Bharat Maruti for its dividend - read on to learn more.
Click the interactive chart for our full dividend analysis
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Jay Bharat Maruti paid out 10% of its profit as dividends, over the trailing twelve month period. We'd say its dividends are thoroughly covered by earnings.
As Jay Bharat Maruti has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A quick way to check a company's financial situation uses these two ratios: net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments on debt. Essentially we check that a) a company does not have too much debt, and b) that it can afford to pay the interest. With net debt of 2.14 times its EBITDA, Jay Bharat Maruti's debt burden is within a normal range for most listed companies.
We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. Interest cover of less than 5x its interest expense is starting to become a concern for Jay Bharat Maruti, and be aware that lenders may place additional restrictions on the company as well.
Remember, you can always get a snapshot of Jay Bharat Maruti's latest financial position,by checking our visualisation of its financial health.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. The first recorded dividend for Jay Bharat Maruti, in the last decade, was nine years ago. Although it has been paying a dividend for several years now, the dividend has been cut at least once by more than 20%, and we're cautious about the consistency of its dividend across a full economic cycle. During the past nine-year period, the first annual payment was ₹1.50 in 2010, compared to ₹2.50 last year. Dividends per share have grown at approximately 5.8% per year over this time. Jay Bharat Maruti's dividend payments have fluctuated, so it hasn't grown 5.8% every year, but the CAGR is a useful rule of thumb for approximating the historical growth.
It's good to see the dividend growing at a decent rate, but the dividend has been cut at least once in the past. Jay Bharat Maruti might have put its house in order since then, but we remain cautious.
Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Jay Bharat Maruti has grown its earnings per share at 26% per annum over the past five years. Earnings per share have grown rapidly, and the company is retaining a majority of its earnings. We think this is ideal from an investment perspective, if the company is able to reinvest these earnings effectively.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Firstly, we like that Jay Bharat Maruti has low and conservative payout ratios. Next, earnings growth has been good, but unfortunately the dividend has been cut at least once in the past. Jay Bharat Maruti performs highly under this analysis, although it falls slightly short of our exacting standards. At the right valuation, it could be a solid dividend prospect.
Now, if you want to look closer, it would be worth checking out ourfreeresearch on Jay Bharat Marutimanagement tenure, salary, and performance.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
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. |
Masi Agricola S.p.A. (BIT:MASI): Are Analysts Bull Or Bear?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Masi Agricola S.p.A.'s (BIT:MASI) released its most recent earnings update in April 2019, which indicated that the company experienced a small tailwind, leading to a single-digit earnings growth of 5.1%. Below, I've presented key growth figures on how market analysts perceive Masi Agricola'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.
Check out our latest analysis for Masi Agricola
Market analysts' prospects for the coming year seems pessimistic, with earnings reducing by -3.2%. In the next couple of years, earnings are expected to continue to be below today's level, with a decrease of -1.6% in 2021, eventually reaching €7.0m in 2022.
Even though it is informative understanding the growth year by year relative to today’s level, it may be more insightful to analyze the rate at which the company is moving every year, on average. The benefit of this approach is that we can get a better picture of the direction of Masi Agricola'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've appended 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 -0.02%. This means that, we can assume Masi Agricola will chip away at a rate of -0.02% every year for the next couple of years.
For Masi Agricola, there are three relevant factors you should look at:
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 MASI 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 MASI is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of MASI? 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. |
WRAPUP 1-Trump to visit S.Korea as Pompeo raises hope for new N.Korea talks after letter
By Hyonhee Shin and Jeff Mason
SEOUL/WASHINGTON, June 24 (Reuters) - U.S. President Donald Trump will visit South Korea this weekend after an exchange of letters with North Korean leader Kim Jong Un boosted hopes for talks aimed at ending North Korea's nuclear programme.
Trump is set to arrive in South Korea for a two-day visit on Saturday, and will meet President Moon Jae-in on Sunday, following a summit of G20 leaders in Japan, Moon's spokeswoman, Ko Min-jung, said.
The announcement comes hours after U.S. Secretary of State Mike Pompeo said he hoped a letter Trump sent to Kim could pave the way for a revival of stalled nuclear talks.
Trump and Moon would have "in-depth discussions on ways to work together to foster lasting peace through the complete denuclearisation of the Korean peninsula, while strengthening the two countries' alliance", Ko told a news briefing on Monday.
Pompeo, who spoke of Trump's letter to Kim before departing from Washington for the Middle East, said the United States was ready to resume talks with North Korea immediately.
"I'm hopeful that this will provide a good foundation for us to begin ... these important discussions with the North Koreans," Pompeo told reporters.
Japanese media reported over the weekend that Trump may go to the demilitarised zone (DMZ) separating the two Koreas. He wanted to visit the zone during a 2017 trip to South Korea but heavy fog prevented it.
A former South Korean unification minister, Chung Se-hyun, who has advised Moon on relations with North Korea, said in a radio interview on Monday that it was possible for Trump to meet Kim in the DMZ.
Kim and Moon held their historic first summit in the DMZ last year. But Ko said details of Trump's itinerary had not been finalised.
Trump and Kim held their first, ground-breaking summit in Singapore in June last year, agreeing to establish new relations and work towards the denuclerisation of the Korean peninsula.
But a second summit in Vietnam in February collapsed when the two sides were unable to bridge differences between U.S. demands for denuclerisation and North Korean demands for sanctions relief.
'EXCELLENT'
With talks stalled, tension mounted last month when the North test-fired a series of short-range ballistic missiles, though Trump and South Korea both played won the tests.
One June 11, Trump said he had received a very warm, "beautiful" letter from Kim, adding he thought something positive would happen.
North Korea's state news agency KCNA said on Sunday Kim had received a letter from Trump, which he described as being "of excellent content", but did not disclose any details.
KCNA said Kim "would seriously contemplate the interesting content".
Shin Beom-chul, a senior fellow at the Asian Institute for Policy Studies in Seoul, said Trump may have proposed a new round of working-level talks but a major breakthrough was not likely for now.
"North Korea has to show what the final state of denuclearisation would look like and what roadmap it has toward that end, but it's not desirable to reopen talks just to manage the situation after recent weapons tests," Shin told Reuters.
A U.S. official said on Wednesday the United States had no pre-conditions for talks, but progress would require meaningful and verifiable North Korean steps to abandon its nuclear weapons programme.
Pompeo did not discuss the contents of Trump's letter, but said the United States had been working to lay foundations for discussions since the Hanoi summit was abruptly ended by Trump.
"I think we're in a better place," Pompeo said.
Asked if working-level discussions would begin soon, Pompeo said: "I think the remarks you saw out of North Korea this morning suggest that may well be a very good possibility. We're ready to go, we're literally prepared to go at a moment's notice if the North Koreans indicate that they're prepared for those discussions."
Pompeo will join Trump at the G20 summit and accompany him to Seoul, after stops in Saudi Arabia and the United Arab Emirates to consult the U.S. allies on growing tension with Iran. (Reporting by Jeff Mason and David Lawder in WASHINGTON and Hyonhee Shin in SEOUL; Additional reporting by Lesley Wroughton in WASHINGTON and Joyce Lee and Do-gyun Kim in SEOUL Editing by Daniel Wallis Robert Birsel) |
ANZ under fire from NZ regulator, government over risk controls, governance
By Praveen Menon and Tom Westbrook
WELLINGTON/SYDNEY (Reuters) - New Zealand's deputy prime minister on Monday called on the chairman of the local unit of Australia and New Zealand Banking Group to step down as regulators ramped up pressure on the lender to improve its internal risk controls and governance.
Deputy Prime Minister Winston Peters said ANZ Chairman John Key, a former prime minister under the opposition National Party, should resign as he found himself at the centre of questions about governance practices at the bank.
Hours earlier, New Zealand's central bank asked ANZ to provide independent proof it's operating in a prudent manner in the wake of last month's censure of the lender.
In an interview with local broadcaster TVNZ, Peters said he thought Key should resign, days after ANZ's New Zealand CEO abruptly left the bank over an expenses scandal.
"It's the Governor of the Reserve Bank who could make that request. But if you were to ask me, if I was the Governor of the Reserve Bank, I would have asked for his resignation, yes," Peters said.
Peters said that Key has a 'massive conflict of interest' because he is also on the board of ANZ's Australian parent.
"I think there's some serious questions that need to be answered, and there's much more to be unearthed in my view," the deputy prime minister said.
In an email to Reuters, ANZ said Key has declined to respond to comments made by Peters.
Later on Monday, the government announced that its review of the Reserve Bank would look at whether the powers were strong enough to regulate the banking sector.
"Now is the right time to check we have the tools to make sure banks meet their obligations to New Zealanders, and the powers to enforce them,” Finance Minister Grant Robertson said in a statement.
ANZ New Zealand's CEO David Hisco abruptly left the bank last week after a review of his expenses showed he logged payments for chauffeurs and wine storage as business expenses rather than personal.
Key said Hisco did not share ANZ's conclusions as he "was adamant he had the authority for the expenditure" but agreed to leave the bank immediately.
The CEO's departure came just weeks after the lender's licence to calculate its own operational risk capital was revoked due to "persistent" control failures.
CONFIDENCE TEST
RBNZ on Monday asked for two reports from ANZ's local unit - the first on its compliance with central bank capital adequacy requirements and a second to assess the bank's internal governance, risk management and internal controls.
"These formal reviews will allow us to work with the bank to ensure the public, and we as regulator, can have continued confidence in the bank," RBNZ Governor Adrian Orr said in a statement.
The reports will need to be compiled by an RBNZ-approved independent person. ANZ said it would comply with the request.
Former RBNZ official and banking industry expert Geof Mortlock said ANZ New Zealand's parent company needs to step up after the series of failures.
"Otherwise they will look negligent as shareholders. It's especially important now, when ANZ, along with the other Australian banks, faced criticism for conduct in the Royal Commission in Australia," he said.
The Royal Commission in Australia exposed industry-wide misconduct as well accusations of profiteering that went all the way up from branch level to the boardroom.
Top Australian banks have been resisting a proposal by RBNZ to raise capital ratios to 16%, meaning the country's top four banks, including ANZ, would collectively need an extra NZ$20 billion in new capital over the next five years.
ANZ said it was sound and strong, with NZ$12.4 billion ($8.2 billion) of capital as at March 31, which it said is NZ$3.5 billion more than regulatory requirements.
($1 = 1.5175 New Zealand dollars)
(Editing by Sam Holmes & Shri Navaratnam) |
Does Masi Agricola S.p.A.'s (BIT:MASI) 5.1% Earnings Growth Reflect The Long-Term Trend?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
After looking at Masi Agricola S.p.A.'s (BIT:MASI) latest earnings update (31 December 2018), I found it helpful to revisit the company's performance in the past couple of years and compare this against the latest numbers. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is an important aspect. In this article I briefly touch on my key findings.
Check out our latest analysis for Masi Agricola
MASI's trailing twelve-month earnings (from 31 December 2018) of €7.1m has increased by 5.1% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -6.0%, indicating the rate at which MASI is growing has accelerated. What's the driver of this growth? Let's see if it is merely owing to an industry uplift, or if Masi Agricola has seen some company-specific growth.
In terms of returns from investment, Masi Agricola has fallen short of achieving a 20% return on equity (ROE), recording 5.7% instead. Furthermore, its return on assets (ROA) of 4.6% is below the IT Beverage industry of 5.5%, indicating Masi Agricola's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Masi Agricola’s debt level, has declined over the past 3 years from 9.4% to 6.0%.
Though Masi Agricola's past data is helpful, it is only one aspect of my investment thesis. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. There may be factors that are impacting the industry as a whole, hence the high industry growth rate over the same period of time. I recommend you continue to research Masi Agricola to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MASI’s future growth? Take a look at ourfree research report of analyst consensusfor MASI’s outlook.
2. Financial Health: Are MASI’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. |
Alyx Fashion Brand Launches IOTA-Powered Pilot for Supply Chain Transparency
Alyx — the luxe fashion brand founded by erstwhile Lady Gaga creative director and Kanye West collaborator Matthew Williams — is launching an IOTA-based pilot for supply chain transparency. The news wasreportedby industry magazine Vogue Business on June 24.
Williams — whoearneda 2016 LVMH Prize finalist nomination for his work at Alyx, and spearheaded brand partnerships with Moncler, Nike and Dior Men — has launched the blockchain pilot together with manufacturing giant Avery Dennison and London-based internet of things (IoT) software firm Evrythng.
As reported, IOTA is an IoT-focused distributed ledger technology firm, which has created an architecture dubbed “Tangle.” Unlike ablockchain, theTangleprotocol does not use “blocks” or mining, but is instead built upon adirected acyclic graph(DAG): a topologically ordered system in which different types of transactions run on different chains in the network simultaneously.
News of the pilotconfirmsearlier reports of a prospective collaboration between Alyx and IOTA.
For the pilot, nine Alyx pieces will reportedly feature a scannable QR-code that reveals the supply chain of the product — including the sourcing of its raw material, the garment’s place of manufacture, and shipping history.
Once Alyx suppliers have entered the relevant data, Evrything stores and uploads it onto the ledger, while Avery Dennison creates a digital ID tag for each unique garment, per the report.
While the pilot remains limited in its scope, Williams has reportedly told Vogue Business that his “north start goal” is to put the entire range of Alyx products onto the blockchain in a bid to promote transparency.
As Vogue Business notes, the fashion industry faces a considerable challenge bringing its supply chain data onto the blockchain given the wide array of materials and manufacturers that can be involved in the production of a unique garment.
Michael Colarossi — Avery Dennison’s vice president of innovation, product line management and sustainability — told the magazine that the key to making a blockchain solution scalable is to increase automation and to identify “the right nodes of the supply chain from where to pull data and then determining how to most efficiently extract that data.”
For Alyx, Williams told Vogue Business, blockchain implementation was relatively less complex, given the brand’s just four-year history and the fact that it produces 80% of its products with Italian suppliers who are committed to transparency. This latter point is important, the report notes, given that the system wholly depends on the accuracy of the input data.
This May,ConsenSysteamed upwith French multinational luxury goods conglomerate LVMH andMicrosoftto build a blockchain-powered platform that allows consumers to verify the authenticity ofluxury products.
• Ethereum-Based Synthetic Asset Platform Misplaces Over 37M Tokens in Oracle Attack
• Sharding, Explained
• IOTA to Enter a New Partnership to Track Potentially Fatal Food Allergens With DLT
• Canadian Pharmacy to Track Cannabis via Blockchain in New Pilot Program |
Bitcoin price: Cryptocurrency holds firm above $10,000
Mate Tokay, COO of Bitcoin.com, works on a laptop beneath the Bitcoin logo at the Consensus 2018 blockchain technology conference in New York City on May 16, 2018. Photo: REUTERS/Mike Segar The price of bitcoin ( BTC-USD ) continues to rally, as the cryptocurrency passed $10,000 per coin over the weekend. Bitcoin jumped above $10,000 early on Saturday morning and peaked at $11,135 around lunchtime UK time on Saturday. The price has since come off slightly but bitcoin is still trading above $10,000. Bitcoin hasn't hit above $10,000 for 15 months, since March 6, 2018, Fred Schebesta, the cofounder of cryptocurrency broker HiveEx.com, said. "Twenty-four-hour volume is among the highest we've ever seen it's at December 2017 levels when bitcoin reached almost $20,000, which means there's double the amount of activity right now. Bitcoin is down 0.6% against the dollar to $10,784 ( BTC-USD ) at 8.30am UK and down 0.4% against the pound to £8,488 ( BTC-GBP ). However, the price holding firm above $10,000 underlines the continued rally of bitcoin prices so far in 2019. The cryptocurrency has rallied over 170% so far this year against the dollar and its price rise has accelerated pace in recent weeks. Bitcoin has risen rapidly so far in 2019. Photo: Yahoo Finance UK Investors are ignoring what happened the last time we saw parabolic rises like this, Neil Wilson, the chief market analyst at Markets.com, said in an email. Is it different this time? No, but people have short memories. Facebooks Libra white paper may have stoked renewed interest in cryptos at a time when the buzz had already returned. Last week a consortium of major companies led by Facebook ( FB ) launched Libra, a new cryptocurrency project that aims to create a global currency launching next year. Facebook just announced Libra coin, Schebesta said. It's going mainstream. If everyone thought the last time was big, when bitcoin reached almost US$20,000 in December 2017, that was just like the first iPhone. Wilson said: Bitcoin is more mature etc, but the fundamentals of this scheme remain unaltered. What I would say is that arguably big money is starting to view this differently and think it could be very costly to ignore if they get left behind. Oscar Williams-Grut covers banking, fintech, and finance for Yahoo Finance UK. Follow him on Twitter at @OscarWGrut . Read more: Taxpayers may have to pay to keep cash alive Ex-Barclays CEO acquitted in criminal case over 2008 bailout Huawei fallout spreads: UK chipmaker's stock tanks 35% on profit warning Bank of England's Carney gives Facebook's Libra cautious backing View comments |
Masi Agricola S.p.A.'s (BIT:MASI) Earnings Grew 5.1%, Did It Beat Long-Term Trend?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Measuring Masi Agricola S.p.A.'s (BIT:MASI) track record of past performance is an insightful exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess MASI's recent performance announced on 31 December 2018 and compare these figures to its historical trend and industry movements.
View our latest analysis for Masi Agricola
MASI's trailing twelve-month earnings (from 31 December 2018) of €7.1m has increased by 5.1% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -6.0%, indicating the rate at which MASI is growing has accelerated. What's enabled this growth? Let's see whether it is solely a result of an industry uplift, or if Masi Agricola has seen some company-specific growth.
In terms of returns from investment, Masi Agricola has fallen short of achieving a 20% return on equity (ROE), recording 5.7% instead. Furthermore, its return on assets (ROA) of 4.6% is below the IT Beverage industry of 5.5%, indicating Masi Agricola's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Masi Agricola’s debt level, has declined over the past 3 years from 9.4% to 6.0%.
Though Masi Agricola's past data is helpful, it is only one aspect of my investment thesis. Recent positive growth isn't always indicative of a continued optimistic outlook. There could be factors that are impacting the industry as a whole, thus the high industry growth rate over the same period of time. I suggest you continue to research Masi Agricola to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MASI’s future growth? Take a look at ourfree research report of analyst consensusfor MASI’s outlook.
2. Financial Health: Are MASI’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. |
Ethereum Co-founder Joseph Lubin has some issues with Facebooks Libra token
Facebooks Libra cryptocurrency is a centralised wolf in decentralised sheeps clothing, according to Joseph Lubin, Founder of ConsenSys and Co-founder of Ethereum. Trust is a slippery subject, especially when magnified to the scale of a global financial infrastructure. Wrote down some reflections on this week's craziness for a piece on @qz . https://t.co/RT4jNTMNtg Joseph Lubin (@ethereumJoseph) June 21, 2019 In an article for Quartz , he states that Facebook is painfully aware of the gulf of trust between itself and the public. And thats likely why the social media itself is hardly mentioned anywhere in its recently unveiled whitepaper or technical documentation. See also: Lambasting Libra: Six less than enthusiastic responses to Facebooks crypto move Trust is a slippery subject, especially when magnified to the scale of a global financial infrastructure. Ten years ago, the Bitcoin whitepaper proposed that instead of relying exclusively on financial institutions serving as trusted third parties to process electronic payments, we can instead rely on cryptoeconomic proof. With an internet connection, anyone can participate in the peer-to-peer network and inspect the ledger. Social consensus can protect against a cabal seeking to reverse or censor transactions, Lubin writes. Yet, with the Libra whitepaper, Facebook is not eliminating subjective trust, but imploring us to trust in Libra. You have to trust that one Libra coin will have intrinsic value by being backed by a basket of currencies and government bonds, rather than the capriciousness of daily cryptocurrency price swings. Facebook will seek trust from regulators that its Calibra wallet can comply with know-your-customer and anti-money laundering laws by requiring government-issued IDs to verify an account. It will need merchants to trust that their initial network will responsibly run nodes to validate transactions on the system. Story continues We are also all increasingly aware of how much money Facebook makes from our data, Lubin continues. What happens when you also wrap your personal finances up in this? That our digital identity will never merge with Libras financial data is a hard perception to shake. It is almost a given, even if they have the best of intentionsaccidents and incursions happen when relying on centralised architectures. Not all bad Facebooks arrival in the crypto space could have some positives, however. In a few years time, there may be as many as two billion new users onboarded to its Libra crypto wallet. In one fell swoop, talented UX designers could reduce the current friction of using cryptocurrency. Managing private keys, understanding gas payments and installing crypto browser plugins could be as simple as pressing send in WhatsApp, another Facebook-owned entity. But the notion of trust wont go away, Lubin insists. As of today, Libra has made a bold promise, and its one that Facebook needs to keep. Until then, Libra is like a centralised wolf in a decentralised sheeps clothing, he concludes. The post Ethereum Co-founder Joseph Lubin has some issues with Facebooks Libra token appeared first on Coin Rivet . |
This drone relies on AI to dodge objects thrown at it
Researchers at theUniversity of Marylandand theUniversity of Zurichequipped a drone with event cameras and a sonar system to make it capable of detecting and dodging objects thrown at it. This technology could help drones and birds safely co-exist in the sky and it could also prove useful for law enforcement and military drones, which are susceptible to attacks.Intheir paper, titled "EVDodge: Embodied AI for High-Speed Dodging on a quadrotor using event cameras," it is stated that the system has an overall success rate of 70 percent.Read more...
More aboutMashable Video,Drones,Objects,Dodgeball, andDodging |
What Does MAS Financial Services Limited's (NSE:MASFIN) P/E Ratio Tell You?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll show how you can use MAS Financial Services Limited's ( NSE:MASFIN ) P/E ratio to inform your assessment of the investment opportunity. MAS Financial Services has a price to earnings ratio of 21.36 , based on the last twelve months. That is equivalent to an earnings yield of about 4.7%. See our latest analysis for MAS Financial Services How Do You Calculate MAS Financial Services's P/E Ratio? The formula for price to earnings is: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for MAS Financial Services: P/E of 21.36 = ₹600.05 ÷ ₹28.09 (Based on the year to March 2019.) Is A High P/E Ratio Good? A higher P/E ratio means that buyers have to pay a higher price for each ₹1 the company has earned over the last year. That is not a good or a bad thing per se , but a high P/E does imply buyers are optimistic about the future. How Growth Rates Impact P/E Ratios Generally speaking the rate of earnings growth has a profound impact on a company's P/E multiple. Earnings growth means that in the future the 'E' will be higher. And in that case, the P/E ratio itself will drop rather quickly. Then, a lower P/E should attract more buyers, pushing the share price up. It's nice to see that MAS Financial Services grew EPS by a stonking 33% in the last year. And its annual EPS growth rate over 5 years is 31%. So we'd generally expect it to have a relatively high P/E ratio. Does MAS Financial Services Have A Relatively High Or Low P/E For Its Industry? One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. The image below shows that MAS Financial Services has a P/E ratio that is roughly in line with the consumer finance industry average (20.9). NSEI:MASFIN Price Estimation Relative to Market, June 24th 2019 MAS Financial Services's P/E tells us that market participants think its prospects are roughly in line with its industry. If the company has better than average prospects, then the market might be underestimating it. I inform my view by by checking management tenure and remuneration , among other things. A Limitation: P/E Ratios Ignore Debt and Cash In The Bank The 'Price' in P/E reflects the market capitalization of the company. That means it doesn't take debt or cash into account. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth. Story continues While growth expenditure doesn't always pay off, the point is that it is a good option to have; but one that the P/E ratio ignores. So What Does MAS Financial Services's Balance Sheet Tell Us? Net debt totals 57% of MAS Financial Services's market cap. This is enough debt that you'd have to make some adjustments before using the P/E ratio to compare it to a company with net cash. The Verdict On MAS Financial Services's P/E Ratio MAS Financial Services has a P/E of 21.4. That's higher than the average in the IN market, which is 15.4. While its debt levels are rather high, at least its EPS is growing quickly. So it seems likely the market is overlooking the debt because of the fast earnings growth. Investors should be looking to buy stocks that the market is wrong about. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. So this free visual report on analyst forecasts could hold the key to an excellent investment decision. Of course, you might find a fantastic investment by looking at a few good candidates. So take a peek at this free list of companies with modest (or no) debt, trading on a P/E below 20. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor 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 |
USD/CAD Daily Forecast – Bear Flag Indicating Downtrend Continuation
TheLoonie pairshowcased a continuation of the last day’s downtrend in the early hours. The tumble rally had begun on June 21 from 1.3226 level which has now reached 1.3188 level. However, the picture appears a bit different over a longer timescale. The pair remains currently under the recovery phase after touching the three-month bottom on June 20.
Meanwhile, the upsurgingCrudeprices kept the downward pressure intact over the pair. The Oil prices were trading near $58.10 bbl, top monthly levels in the Asian session.
The demand for the commodity strengthened as the US-Iran tensions appeared to get worse. Iran had downed a US drone last week over straying into the Iranian airspace. During the weekend, the US had attempted a few Cyber attacks on Iran aiming to disable the country’s rocket launch system.
Somehow, the US attacks remained quite unsuccessful says Iran’s telecom minister. “They try hard, but have not carried out a successful attack,” Ministersaidon social network Twitter.
US Secretary of State Mike Pompeo said “significant” sanctions would be imposed on Iran today. This move would aim to deteriorate the funds that empower such nuclear activities in the region.
Ahead of the day, the Canadian economic docket remains quite silent amid lack of events. However, there is the US May Chicago Fed National Activity Index about to come at around 14:30 GMT. The market expects the Index to report -037 points this time over previous -0.45 points.
There is also no Oil price impacting events like theAPIorEIACrude report lined up today.
The USD/CAD pair appeared to maintain a consolidation mode in the lower vicinity of the chart. The pair had remained sustained within the range of 1.3152 and 1.3229 levels since Monday opening. The overall pattern recalls slightly of a “Bear flag” where a consolidation follows a substantial downfall. Hence, the traders can keep a closer watch over the pair. Any movement breaching the 1.3229 resistance covering would be a strong sell signal. Traders can exit in such a case as that preludes of downtrend continuation.
Let’s confirm the stance with the application of some technical indicators. The 50-days SMA that reveals short-term trend was moving along with the pair, showing a neutral stance. Despite that, the significant 200-daysSMAremained well above the pair warning a sharp pullback. The 100-days SMA was also heading south towards the pair showing consolidation to stay for some time. Also, theRSI(Relative Strength Index) indicated 40 levels showing a lack of buyer interest. Chances of any trend reversal in the near-term stay low as the RSI moves, replicating the pair’s movements.
Thisarticlewas originally posted on FX Empire
• Oil Price Fundamental Daily Forecast – Late Session API Report Could Trigger Volatile Reaction
• Technical Analysis MACD – How Professional Trader Use it
• Gold Goes Boom as High Trend Resistance is Bulldozed by Bulls
• USD just Gave Up
• Natural Gas Price Fundamental Daily Forecast – Heat in Forecast, but Will It Last?
• EUR/USD Daily Forecast: Euro Eases Back From 3-Month High |
Qatar will invest $3 billion in Pakistan, state news agency says
DUBAI (Reuters) - Qatar is making $3 billion worth of new investments in Pakistan, in the form of deposits and direct investments, the Qatari state news agency QNA said on Monday.
Following this investment, the economic partnership between Qatar and Pakistan will reach $9 billion, the agency reported, quoting Qatari Foreign Minister Sheikh Mohammed bin Abdulrahman al-Thani.
Last month, Pakistan reached an accord in principle with the International Monetary Fund for a three-year, $6 billion bailout package aimed at shoring up its fragile public finances and strengthening a slowing economy.
The Qatari announcement came after a visit by Qatar's emir to Pakistan. During the visit, Pakistan and Qatar signed several memoranda of understanding for trade and investment, tourism and business and for cooperation in financial intelligence, according to the Pakistani government's Twitter account.
Pakistani Prime Minister Imran Khan's government is seeking to stabilise its economy with loans from Gulf countries and international donors.
Saudi Arabia earlier provided Pakistan with a $3 billion loan and a similar amount every year in oil supply on deferred payments. The United Arab Emirates also announced a $3 billion loan package.
(Reporting by Maha El Dahan, writing by Nafisa Eltahir; editing by Saeed Azhar, Larry King) |
MBL Infrastructures Limited (NSE:MBLINFRA) Insiders Increased Their Holdings
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 before you buy or sellMBL Infrastructures Limited(NSE:MBLINFRA), 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 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 MBL Infrastructures
Chairman Anjanee Lakhotia made the biggest insider purchase in the last 12 months. That single transaction was for ₹120m worth of shares at a price of ₹10.00 each. That means that even when the share price was higher than ₹6.10 (the recent price), an insider wanted to purchase shares. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Anjanee Lakhotia was the only individual insider to buy over the year.
You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at thisfreelist of companies. (Hint: insiders have been buying them).
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that MBL Infrastructures insiders own 15% of the company, worth about ₹100m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. Whilst better than nothing, we're not overly impressed by these holdings.
It doesn't really mean much that no insider has traded MBL Infrastructures shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. It would be great to see more insider buying, but overall it seems like MBL Infrastructures insiders are reasonably well aligned (owning significant chunk of the company's shares) and optimistic for the future.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 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. |
Bitcoin trades above $11,000, after 10% weekend jump
By Tom Wilson and Gertrude Chavez-Dreyfuss
LONDON/NEW YORK (Reuters) - Bitcoin tested 15-month highs on Monday after jumping more than 10% over the weekend, with analysts ascribing the spike to growing optimism over the adoption of cryptocurrencies after Facebook unveiled its Libra digital coin.
The original cryptocurrency hit $11,247.62 on the Bitstamp exchange late on Sunday, its highest since March last year. It later pulled back, and was last up 1.9% at $11,039.62.
Facebook said last week it planned to launch a new cryptocurrency called Libra, though the announcement immediately led to questions from regulators and politicians across the world.
Mati Greenspan, an analyst at eToro, said bitcoin's gains underscored growing optimism among retail investors that Facebook's plans were part of a wider trend of major companies adopting cryptocurrencies.
"They believe that Libra will create mass awareness of cryptocurrencies and act as a gateway to adoption."
(Graphic: Bitcoin tests $11,000 - https://tmsnrt.rs/2Ft6UJU)
BITCOIN "HALVING" IN 2020
One of the biggest reasons for the bitcoin rally, analysts said, is the cryptocurrency's next "halving" in May 2020, where the rewards offered to bitcoin miners shrink. That has constrained the supply of the digital currency.
Bitcoin relies on so-called "mining" computers that validate blocks of transactions by competing to solve mathematical puzzles every 10 minutes. In return, the first to solve the puzzle and clear the transaction is rewarded new bitcoins. Bitcoin technology was designed in such a way that it cuts the reward for miners in half every four years, a move meant to keep a lid on inflation.
The mining reward is currently 12.5 bitcoins. In the next halving in 2020, the reward will fall to 6.25 new bitcoins.
"Bitcoin always does a 200% pump within 1 year before the halving and another much, much bigger pump in the year after the halving," said Stuttgart-based Marius Kramer, a social media influencer who currently works with crypto investing app Ember Fund.
Other traders cited geopolitical factors from tensions in the Gulf region to the U.S.-China trade war as fuelling interest in bitcoin, which has more than doubled in price since March.
Thomas Puech of Enigma Securities, a London-based firm that specializes in larger size over-the-counter cryptocurrency deals, said growing tensions between the United States and Iran were "gas" for bitcoin and other cryptocurrencies.
In late March, bitcoin broke out of a spell of limited price moves. So far this year it has surged nearly 200%, an ascent peppered by double-digit price swings.
Bitcoin's volatility has been a boon to larger investors such as hedge funds, and other investors searching for returns as central banks across the world lean toward lower interest rates, said Puech.
(Reporting by Tom Wilson in London and Gertrude Chavez-Dreyfuss in New York; Editing by Tommy Wilkes, Mark Potter and Chris Reese) |
Is Ymagis Société Anonyme's (EPA:MAGIS) CEO Salary Justified?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Jean-Marc Mizrahi is the CEO of Ymagis Société Anonyme (EPA:MAGIS). First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Ymagis Société Anonyme
At the time of writing our data says that Ymagis Société Anonyme has a market cap of €9.6m, and is paying total annual CEO compensation of €120k. (This figure is for the year to December 2017). Notably, the salary of €120k is the vast majority of the CEO compensation. We took a group of companies with market capitalizations below €177m, and calculated the median CEO total compensation to be €145k.
That means Jean-Marc Mizrahi receives fairly typical remuneration for the CEO of a company that size. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance.
The graphic below shows how CEO compensation at Ymagis Société Anonyme has changed from year to year.
Ymagis Société Anonyme has reduced its earnings per share by an average of 4.7% a year, over the last three years (measured with a line of best fit). Its revenue is down -7.1% over last year.
Unfortunately, earnings per share have trended lower over the last three years. And the impression is worse when you consider revenue is down year-on-year. It's hard to argue the company is firing on all cylinders, so shareholders might be averse to high CEO remuneration. It could be important to checkthis free visual depiction ofwhat analysts expectfor the future.
With a three year total loss of 87%, Ymagis Société Anonyme would certainly have some dissatisfied shareholders. It therefore might be upsetting for shareholders if the CEO were paid generously.
Jean-Marc Mizrahi is paid around what is normal the leaders of comparable size companies.
The company isn't growing EPS, and shareholder returns have been disappointing. Few would argue that it's wise for the company to pay any more, before returns improve. Shareholders may want tocheck for free if Ymagis Société Anonyme insiders are buying or selling shares.
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. |
What Kind Of Shareholder Owns Most Mynaric AG (FRA:M0Y) Stock?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
A look at the shareholders of Mynaric AG (FRA:M0Y) can tell us which group is most powerful. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.
With a market capitalization of €104m, Mynaric is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholder can tell us about M0Y.
Check out our latest analysis for Mynaric
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 Mynaric does have institutional investors; and they hold 8.7% 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 Mynaric's historic earnings and revenue, below, but keep in mind there's always more to the story.
We note that hedge funds don't have a meaningful investment in Mynaric. There is some analyst coverage of the stock, but it could still become more well known, with time.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 most recent data indicates that insiders own a reasonable proportion of Mynaric AG. Insiders have a €42m stake in this €104m 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 holds a 24% stake in M0Y. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.
Our data indicates that Private Companies hold 27%, of the company's shares. 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's always worth thinking about the different groups who own shares in a company. But to understand Mynaric 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.
If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can checkthis free report showing analyst forecasts for its future.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
'Where's the Gratitude, Peter Schiff?' - Gold Bug Gets Grilled By Bitcoin Proponents
Former Wall Street trader and host of the Keiser ReportMax Keiserwasleading the backlashagainst the bitcoin (BTC) naysayers this weekend as the bitcoin price passed $11,000.
Using Twitter as a platform, Keiser focused ongoldenthusiasts after several claimed that despite its performance, bitcoin was still an inferior bet to the precious metal.
Among them wasPeter Schiff, the veteran gold bug who has regularly trashedcryptocurrencyboth informally and via interviews while ironically alsoaccepting itas payment.
“It doesn't matter how high the price of Bitcoin rises unless you sell. Every buyer must eventually sell to realize any benefit from the rise,” he wrote Saturday.
“But therein lies the problem. Once hodlers decide to cash out, the price collapses, wiping out paper gains before they can be realized!”
Keiser did not accept his words, suggesting Schiff owed bitcoin a debt of gratitude for gold’s own gains. As Cointelegraphreported, a mixture of factors has seen gold make rapid progress in line with bitcoin in recent months.
“Where’s the gratitude, Peter? Bitcoin has given Gold a hard money halo; igniting interest in hard money again, driving the price of Gold higher,” Keiser responded.
In a further Twitter post, headded:
“The (bitcoin) community now has a greater understanding of money and monetary history than the Gold community. This ‘flippining’ is relatively recent, and it explains why Gold Bugs are struggling right now.”
Schiff faced further difficulties when he attempted to disprove bitcoin having intrinsic value. Long a favorite argument, he had touted it as a reason for gold’s superiority as far back as 2011, when he decried the idea of holding what he called “Bitcoms” because of a lack of liquidity.
Bitcoin since mushroomed in value, one commentatornotedthis week, while gold never broke out of its trading corridor.
“The only demand for Bitcoin comes from speculators,” Schiff further claimed this week, to which analyst Vijay Boyapatireplied:
“The vast majority of gold's price is monetary premium, just like Bitcoin. Industrial use does not protect that premium in any way. The premium is based on suitability as a store of value where Bitcoin excels over even gold.”
Boyapati included a comparison of this ‘premium’ in gold, bitcoin and silver.
Yet Schiff was not alone in his lack of faith, with Roy Sebag, founder of precious metals custodian Goldmoney,also claimingbitcoin users did not have an argument over gold.
Schiff’s debate with ‘The Bitcoin Standard’ author, Saifedean Ammous,turned headswhen it aired in May, the first in a series of high-stakes encounters for bitcoin proponents.
The coming weeks will see bothWarren BuffettandNouriel Roubini- perhaps the biggest bitcoin naysayers of all -come face to facewith cryptocurrency figures.
• Crypto Analyst Says Bitcoin Price Could Hit $100,000 During Next Bull Run
• Bitcoin Hash Rate Climbs to New Record High Boosting Network Security
• Bitcoin Generates More Carbon Emissions Than Some Countries, Study Warns
• No, It’s Not Facebook: Bitcoin Price Already Up 200% in 2019 Before Libra |
UPDATE 2-European shares fall as Daimler weighs, Sino-U.S. trade news awaited
* Daimler falls after profit warning, drags carmakers lower
* London stocks eke out small gains
* MorphoSys jumps on positive blood cancer drug data (Updates to close)
By Susan Mathew and Medha Singh
June 24 (Reuters) - Weak German economic data and a profit warning from Daimler weakened European stock markets on Monday as investors reined in any bets on a fourth week of gains before G20 meetings that may see more trade talks between the U.S. and Chinese presidents.
Up 4% so far in June, the pan-European STOXX 600 index closed 0.25% lower on the day, with most of its major component markets in the red, led by a 0.5% dip in Frankfurt's DAX.
London's FTSE rose 0.1% thanks to gains in defensive plays including healthcare stocks. Traders also pointed to the weakness of the pound, which tends to boost the index's internationally-focused firms.
The main European index has shown signs of flagging in the past week after recouping almost all of its losses from a sharp sell-off in May, helped by expectations of more monetary stimulus globally.
Corporate newsflow continues to point to a slowdown in growth and Mercedes-Benz maker Daimler dropped 3.8% after it cut its 2019 earnings outlook and lifted provisions for issues related to its diesel vehicles by hundreds of millions of euros.
"The endless array of so-called one-time effects (on Daimler) raises questions regarding process, management information systems and ultimately accountability of management," Evercore ISI analyst Arndt Ellinghorst said in a research note.
Peers Volkswagen AG and Bayerische Motoren Werke AG also slipped, taking the European auto sector down 1.2%.
That, allied to data showing German business morale fell to its lowest level since November 2014 in June, saw the DAX post its worst session in a week.
U.S. President Donald Trump and his Chinese counterpart Xi Jinping are expected to discuss trade on the sidelines of the summit in Japan, after talks to reach a broad deal broke down last month with the U.S. accusing China of reneging on previous commitments.
"The outcome from the Trump-Xi meeting promises significant implications for investors who are finalizing their outlooks for the second half of 2019," wrote Han Tan, Market Analyst at FXTM in a note.
"While the ... meeting is a meaningful step towards de-escalating tensions, markets could also be left disappointed."
The biggest gainer on Europe's main index was MorphoSys , up almost 6% after it presented data showing its blood cancer drug met its main goal in a study. (Reporting by Amy Caren Daniel, Medha Singh and Susan Mathew in Bengaluru; editing by Patrick Graham and Andrew Heavens) |
LS telcom AG’s (ETR:LSX) Investment Returns Are Lagging Its Industry
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Today we'll evaluate LS telcom AG (ETR:LSX) to determine whether it could have potential as an investment idea. Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business.
First, we'll go over how we calculate ROCE. Then we'll compare its ROCE to similar companies. 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. In general, businesses with a higher ROCE are usually better quality. 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 LS telcom:
0.047 = €1.2m ÷ (€35m - €9.6m) (Based on the trailing twelve months to March 2019.)
Therefore,LS telcom has an ROCE of 4.7%.
See our latest analysis for LS telcom
ROCE is commonly used for comparing the performance of similar businesses. Using our data, LS telcom's ROCE appears to be significantly below the 9.4% average in the Software industry. This could be seen as a negative, as it suggests some competitors may be employing their capital more efficiently. Aside from the industry comparison, LS telcom's ROCE is mediocre in absolute terms, considering the risk of investing in stocks versus the safety of a bank account. Investors may wish to consider higher-performing investments.
LS telcom reported an ROCE of 4.7% -- better than 3 years ago, when the company didn't make a profit. That suggests the business has returned to profitability.
When considering ROCE, bear in mind that it reflects the past and does not necessarily predict the future. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is, after all, simply a snap shot of a single year. If LS telcom is cyclical, it could make sense to check out thisfreegraph of past earnings, revenue and cash flow.
Current liabilities are short term bills and invoices that need to be paid in 12 months or less. Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual. To counteract this, we check if a company has high current liabilities, relative to its total assets.
LS telcom has total liabilities of €9.6m and total assets of €35m. As a result, its current liabilities are equal to approximately 28% of its total assets. It is good to see a restrained amount of current liabilities, as this limits the effect on ROCE.
If LS telcom continues to earn an uninspiring ROCE, there may be better places to invest. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
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. |
Georgia 2020 parliament vote to use proportional system- ruling party head
TBILISI, June 24 (Reuters) - A parliamentary election in Georgia in 2020 should be held under a proportional system, the head of the ruling Georgian Dream party, Bidzina Ivanishvili, said on Monday.
Ivanishvili said that no threshold for parties should be applied during the election.
Changing the electoral system from a mixed to a proportional system from 2020 was one of the demands made at protests that have been taking place in the Georgian capital since June 20. (Reporting by Margarita Antidze; editing by Christian Lowe) |
Gold Prices Hit 6-Year High on Iran Dispute, Fed Rate Cut Hopes
Investing.com - The rally in gold prices continued for a second week on Monday as tensions between the U.S. and Iran supported safe-haven demand, adding to the momentum generated by hopes for interest rate cuts from the Federal Reserve.
Spot gold rose as far as $1,411.21, its highest since September 2013, overnight before retracing slightly to $1408.26 by 8:20 AM ET (12:20 GMT), a gain of 0.6% on the day.
Gold futures for August delivery on the Comex division of the New York Mercantile Exchange, gained $12.15, or 0.9%, to $1,412.25 a troy ounce, its highest level since July 2014.
Secretary of State Mike Pompeo warned that the U.S. would announce “significant” sanctions Monday and said he would seek to build a “global coalition” to deal with Iran as he meets for talks with Saudi Arabia and the United Arab Emirates.
The sanctions will effectively be the U.S.'s response to Iran’s shooting down of an unmanned U.S. drone last week. President Trump had approved retaliatory airstrikes before subsequently calling them off.
The geopolitical tension has provided a second engine to a gold rally powered by expectations of monetary policy easing. The Fed indicated at its meeting last week that it could cut interest rates, possibly as soon as next month, to offset the effects of the trade conflict with China, which has slowed global growth and subdued U.S. inflation.
Ole Hansen, head of commodity strategy at Saxo Bank, pointed out that last week’s Commitment of Traders report revealed a record increase in net-long positions in gold in the three-week run-up to the Fed policy decision.
“With this in mind, the short-term focus turns to gold’s ability to hold onto these gains and reassure new longs that they have not bought another high but instead a potential new low,” Hansen said.
Stephen Innes, OANDA head of trading in Singapore, indicated that “gold continues to trade well despite equities rallying to all-time highs and while I do think one of these markets will eventually prove to be wrong, for the time being, the race to the bottom in fixed income market remains supportive for both.”
Innes warned that downside risks for gold centered on any sign of de-escalation in the Middle East or “a more trade-friendly atmosphere” out of this week’s G20 summit, but emphasized that strategic buyers are moving in on dips and said official demand from China also remained a strong pillar of support. Data released earlier this month showed the Chinese central bank had increased its monthly purchases of gold to nearly 16 tons in April, well above the average of the previous four months.
Given the number of possible catalysts that could trigger a stock correction, “gold needs to be your first flipside investment,” Innes concluded.
In other metals trading, silver futures rose 0.3% at $15.338 a troy ounce by 8:20 AM ET (12:20 GMT).
Palladium futures traded up 0.5% at $1,507.25 an ounce, while sister metal platinum advanced 0.4% at $818.85.
In base metals, copper fell 0.4% to $2.692 a pound.
Related Articles
Oil prices up on U.S.-Iran tensions
Soybeans May Be Next Market to Surge as U.S. Showers Drag On
BlackRock Sees Gold Ending Year Higher on Fed's Dovish Pivot |
At RUруб5.64, Is It Time To Put Public Joint-Stock Company Lenenergo (MCX:LSNG) On Your Watch List?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Public Joint-Stock Company Lenenergo (MCX:LSNG), which is in the electric utilities business, and is based in Russia, had a relatively subdued couple of weeks in terms of changes in share price, which continued to float around the range of RUB5.59 to RUB6.08. However, is this the true valuation level of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Lenenergo’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for Lenenergo
According to my relative valuation model, the stock seems to be currently fairly priced. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 4.61x is currently trading slightly below its industry peers’ ratio of 7.08x, which means if you buy Lenenergo today, you’d be paying a reasonable price for it. And if you believe Lenenergo should be trading in this range, then there isn’t much room for the share price grow beyond where it’s currently trading. So, is there another chance to buy low in the future? Given that Lenenergo’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us an opportunity to buy later on. This is based on its high beta, which is a good indicator for share price volatility.
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. However, with an expected decline of -2.5% in revenues over the next couple of years, near-term growth certainly doesn’t appear to be a driver for a buy decision for Lenenergo. This certainty tips the risk-return scale towards higher risk.
Are you a shareholder?Currently, LSNG appears to be trading around its fair value, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on LSNG, take a look at whether its fundamentals have changed.
Are you a potential investor?If you’ve been keeping tabs on LSNG for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The price seems to be trading at fair value, which means there’s less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help crystalize your views on LSNG should the price fluctuate below its true value.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Lenenergo. You can find everything you need to know about Lenenergo inthe latest infographic research report. If you are no longer interested in Lenenergo, 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. |
WRAPUP 5-Trump to visit S.Korea as Pompeo raises hope for new N.Korea talks after letter
(Adds senior U.S. administration official on Trump's plans during South Korea visit)
By Hyonhee Shin and Jeff Mason
SEOUL/WASHINGTON, June 24 (Reuters) - U.S. President Donald Trump will visit South Korea this weekend after an exchange of letters with North Korean leader Kim Jong Un boosted hopes for a resumption of talks aimed at ending North Korea's nuclear program.
Trump is set to arrive in South Korea for a two-day visit on Saturday and will meet President Moon Jae-in on Sunday, following a summit of G20 leaders in Japan, Moon's spokeswoman, Ko Min-jung, said on Monday.
The announcement came hours after U.S. Secretary of State Mike Pompeo said he hoped a letter Trump sent to Kim could pave the way for a revival of talks that have been stalled since a failed second summit between Trump and Kim in February.
Trump and Moon would have "in-depth discussions on ways to work together to foster lasting peace," Ko told a news briefing.
Trump told reporters at the White House that Kim had sent him birthday wishes. "It was just a very friendly letter both ways. We have a very good relationship," he said.
Pompeo, who spoke of Trump's letter to Kim before leaving Washington on Sunday for a trip to the Middle East and Asia, said Washington was ready to resume talks with North Korea immediately.
"I'm hopeful that this will provide a good foundation for us to begin ... these important discussions with the North Koreans," Pompeo told reporters.
Trump is considering a visit to the demilitarized zone (DMZ) separating the two Koreas, a South Korean official said.
A Trump administration official briefing reporters on a conference call said Trump had no plans to meet Kim during his visit to South Korea, and declined to comment when asked whether Trump would travel to the DMZ.
Trump wanted to go to the DMZ on a 2017 trip to South Korea but heavy fog prevented it. Kim and Moon held their historic first summit in the DMZ last year.
Trump and Kim held their first, groundbreaking summit in Singapore in June last year, agreeing to establish new relations and work towards the denuclearisation of the Korean Peninsula.
But a second summit in Vietnam in February collapsed when the two sides were unable to bridge differences between U.S. demands for denuclearisation and North Korean demands for sanctions relief.
The director of the U.S. Defense Intelligence Agency, Lieutenant General Robert Ashley, told Fox News on Monday that the intelligence community continued to assess that Kim Jong Un was not ready to give up his nuclear weapons.
Stephen Biegun, the U.S. special envoy for North Korea, said on Wednesday that Washington had no preconditions for talks but that progress would require meaningful and verifiable North Korean steps to denuclearise.
The State Department said Biegun, who led working-level talks with North Korea in the run-up to the Hanoi summit, would visit Seoul from Thursday until Sunday for meetings with South Korean officials.
'EXCELLENT'
Tension mounted last month when North Korea test-fired a series of short-range ballistic missiles, although Trump and South Korea both played down the tests.
One June 11, Trump said he had received a very warm, "beautiful" letter from Kim, adding he thought something positive would happen.
North Korea's state news agency, KCNA, said on Sunday that Kim had received a letter from Trump, which he described as being "of excellent content", but did not disclose any details.
KCNA said Kim "would seriously contemplate the interesting content".
Shin Beom-chul, a senior fellow at the Asian Institute for Policy Studies in Seoul, said Trump may have proposed a new round of working-level talks but that a major breakthrough was unlikely for now.
"North Korea has to show what the final state of denuclearisation would look like and what road map it has toward that end, but it's not desirable to reopen talks just to manage the situation after recent weapons tests," Shin told Reuters.
Pompeo, who will also be in Seoul for Trump's visit, did not discuss the contents of the president's letter, but said Washington had been working to lay foundations for discussions.
"I think we're in a better place," he said.
Asked if working-level discussions would begin soon, Pompeo said: "I think the remarks you saw out of North Korea this morning suggest that may well be a very good possibility. We're ready to go, we're literally prepared to go at a moment's notice if the North Koreans indicate that they're prepared for those discussions."
Joseph Yun, Biegun's predecessor as special envoy for North Korea, told a panel discussion at Washington's Center for Strategic and International Studies that he expected there to be a third summit between Trump and Kim and it would probably take place "sooner rather than later."
Victor Cha, a former White House official involved in past negotiations with North Korea, told the same event he expected Trump to go to the DMZ and noted Chinese President Xi Jinping's visit to North Korea last week.
"Whenever you see high-level letter and then the Chinese and North Koreans meeting, that's kind of like the set-up for a third meeting," he said.
"The question is, is he going to make a big statement at the DMZ ... is he going to do it with President Moon. Are there going to be other surprises? This president likes surprises." (Reporting by Jeff Mason in Washington and Hyonhee Shin in Seoul; Additional reporting by David Lawder, David Brunnstrom, Lesley Wroughton, Roberta Rampton and Doina Chiacu in Washington and Joyce Lee and Do-gyun Kim in Seoul; Editing by Robert Birsel, James Dalgleish and Peter Cooney) |
Subsets and Splits
No community queries yet
The top public SQL queries from the community will appear here once available.