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How Much Of Lar España Real Estate SOCIMI, S.A. (BME:LRE) Do Institutions Own?
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Every investor in Lar España Real Estate SOCIMI, S.A. (BME:LRE) should be aware of the most powerful shareholder groups. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that used to be publicly owned tend to have lower insider ownership.
With a market capitalization of €627m, Lar España Real Estate SOCIMI is a small cap stock, so it might not be well known by many institutional investors. In the chart below below, we can see that 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 LRE.
Check out our latest analysis for Lar España Real Estate SOCIMI
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.
Lar España Real Estate SOCIMI already has institutions on the share registry. Indeed, they own 65% of the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Lar España Real Estate SOCIMI'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. It looks like hedge funds own 20% of Lar España Real Estate SOCIMI shares. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. There are 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. 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 less than 1% of Lar España Real Estate SOCIMI, S.A.. It seems the board members have no more than €631k worth of shares in the €627m company. 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 15% ownership, the general public have some degree of sway over LRE. 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.
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow, for free.
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. |
Jeremy Hunt piles pressure on coward Boris Johnson amid claims he is all over the place and psychologically unfit to lead
Boris Johnson refused to answer questions at Saturday's hustings in Birmingham about a police visit to his home (Picture: PA) Boris Johnsons bid to become Prime Minister descended further into chaos today as he was branded a coward and warned a government under his leadership could collapse immediately. Leadership rival Jeremy Hunt piled the pressure on Mr Johnson to explain the police visit to his home after it emerged officers had visited the London flat he shares with his partner Carrie Symonds after reports of a domestic disturbance. He continues to be dogged by accusations of ducking scrutiny after failing to take part in a Sky News debate this week. Mr Hunt told Sky News: This is an audition to be prime minister of the UK. If Boris is refusing to answer questions in the media, refusing to do live debates then of course people are thinking: just who are we going to get as PM? Jeremy Hunt has told Mr Johnson: "Don't be a coward" (Picture: PA) Tory MP Tobias Ellwood warned a Johnson-led Government could be brought down within days. Mr Ellwood said a dozen or so Conservative MPs would consider bringing down a Tory government rather than see the UK leave the EU without a deal. If a number of rebel Tories supported a no-confidence motion the government would collapse and a General Election would be triggered. Mr Johnson says he would take the UK out of the EU without a deal on 31 October if he fails to negotiate an improved deal before then. The Conservative government currently has a majority of just four, meaning only a very small number of MPs need to rebel to tear the government down. Media outside the home of Conservative party leadership candidate Boris Johnson in south London (Picture: PA) The former foreign secretarys personal life is being dragged into the race to be the next Prime Minister after the police incident at the weekend. The Daily Mirror reported that, according to friends, Mr Johnson wants to get back with his estranged wife, barrister Marina Wheeler, despite being in a relationship with Ms Symonds, and that he is finding their divorce extremely painful. Sources close to his family told the newspaper that he was all over the place and psychologically unfit to be Ms Symondss long-term partner. Story continues Meanwhile, The Sun reported that Mr Johnson and Ms Symonds have had four serious rows in the past six weeks and nearly split up at the start of this month. A friend told the newspaper: Carrie and Boris have an incredibly volatile relationship this was by no means the first explosive row theyve had. Labour MP Jess Phillips said Mr Johnson should have taken the opportunity at a leadership hustings event on Saturday to thank his neighbours for being concerned for the welfare of his partner. She told LBC : "Boris Johnson had the opportunity to give an explanation and to say to the nation that it was the right thing for the neighbours to call the police and the right thing for them to try to gather evidence. "But instead his very poor character has picked himself over the safety of women in this country, and the line that he is putting out is that this is a private family matter. "Those of us who have campaigned for years have tried to move that dial, and he is taking us back and that is dangerous." 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 Mr Hunt urged Mr Johnson not to be a coward about facing public scrutiny. Writing in The Times , he insisted he has no interest in debating Mr Johnsons private life, but wants to challenge him on television over his commitment to taking the UK out of the EU by the end of October. Boris Johnson and Jeremy Hunt sit side by side during last week's TV debate (Picture: Getty) Mr Hunt said: "A new prime minister needs the legitimacy of having made his arguments publicly and having them subjected to scrutiny. "Only then can you walk through the front door of No 10 with your head held high instead of slinking through the back door, which is what Boris appears to want." He added: "Don't be a coward Boris, man up and show the nation you can cope with the intense scrutiny the most difficult job in the country will involve." Mr Hunt said on Sunday he thought any candidate for prime minister "should answer questions on everything". Boris Johnson and Jeremy Hunt are fighting to be the next prime minister (Picture: Getty) In his weekly column in The Telegraph, Mr Johnson did not address the incident. Instead, he repeated his determination to deliver Brexit by Halloween. He wrote: "We must leave the EU on Oct 31 come what may. It will honour the referendum result, it will focus the minds of EU negotiators." ---Watch the latest videos from Yahoo UK--- |
German business confidence dips further to near 5-year low
BERLIN (AP) — A closely watched survey is showing that German business confidence has fallen to a near five-year low as managers' expectations for the coming six months have deteriorated. The Ifo institute said Monday that its monthly confidence index slipped to 97.4 points in June from 97.9 last month, in line with market expectations. The third straight monthly fall takes the index to its lowest since November 2014 and was entirely due to managers' waning views of future prospects. Their assessment of the current situation rose modestly from May. German growth forecasts have been cut repeatedly recently and the economy is expected to turn in a feeble performance in the second quarter after returning to growth in the winter. Ifo's survey is based on responses from some 9,000 firms. |
Do Directors Own Lar España Real Estate SOCIMI, S.A. (BME:LRE) Shares?
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Every investor in Lar España Real Estate SOCIMI, S.A. (BME:LRE) should be aware of the most powerful shareholder groups. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Companies that used to be publicly owned tend to have lower insider ownership.
Lar España Real Estate SOCIMI is a smaller company with a market capitalization of €627m, so it may still be flying under the radar of 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 LRE.
View our latest analysis for Lar España Real Estate SOCIMI
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 65% of Lar España Real Estate SOCIMI. 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. 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 Lar España Real Estate SOCIMI, (below). Of course, keep in mind that there are other factors to consider, too.
Since institutional investors own more than half the issued stock, the board will likely have to pay attention to their preferences. Our data indicates that hedge funds own 20% of Lar España Real Estate SOCIMI. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. 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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our data suggests that insiders own under 1% of Lar España Real Estate SOCIMI, S.A. in their own names. It seems the board members have no more than €631k worth of shares in the €627m company. I generally like to see a board more invested. However it might be worth checkingif those insiders have been buying.
The general public holds a 15% stake in LRE. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.
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 always like to check for ahistory of revenue growth. You can too, by accessing this free chart ofhistoric revenue and earnings in thisdetailed graph.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss thisfreereport on analyst forecasts.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Researchers Uncover Threat of ‘Unusual’ Virtual Machine Crypto Mining
Cybersecurity firm ESET has detected what it describes as an unusual and persistent cryocurrency miner distributed for macOS and Windows since August 2018. The news was revealed in a report from ESET Research published on June 20. According to ESET, the new malware, dubbed “LoudMiner,” uses virtualization software — VirtualBox on Windows and QEMU on macOS — to mine crypto on a Tiny Core Linux virtual machine, thus having the potential to infect computers across multiple operating systems. The miner itself reportedly uses XMRig — an open-source software used for mining privacy-focused altcoin monero ( XMR ) — and a mining pool, thereby purportedly thwarting researchers’ attempts to retrace transactions. The research revealed that for both macOS and windows, the miner operates within pirated applications, which are bundled together with virtualization software, a Linux image and additional files. Upon download, LoudMiner is installed before the desired software itself, but conceals itself and only becomes persistent after reboot. ESET notes that the miner targets applications whose purposes are related to audio production, which usually run on computers with robust processing power and where high CPU consumption — in this case caused by stealth crypto mining — might not strike users as suspicious. Moreover, the attackers purportedly exploit the fact that such complex applications are usually complex and large in order to conceal their virtual machine images. The researchers add: “The decision to use virtual machines instead of a leaner solution is quite remarkable and this is not something we routinely see.” ESET has identified three strains of the miner targeted at macOS systems, and just one for Windows thus far. As a warning to users, the researchers state that “obviously, the best advice to be protected against this kind of threat is to not download pirated copies of commercial software.” Story continues Nonetheless, alongside high CPU consumption, they offer several hints to help users detect something might be awry, included trust popups from an unexpected, “additional” installer, or a new service added to the startup services list (Windows) or a new Launch Daemon (macOS). Network connections to unusual domain names — due to scripts inside the virtual machine that contacting the C&C server to update the miner’s configuration — are another giveaway, the researchers add. Yesterday, Cointelegraph published an in-depth report analyzing various malware deployments within the crypto industry, including for stealth crypto mining. Related Articles: Trend Micro: Outlaw Hacking Group’s Botnet Is Now Spreading a Monero Miner Report: Android Phishing Malware Impersonates Turkish Cryptocurrency Exchange Major Pan-African Insurance Firm Rolls Back Insurance for Crypto Mining Equipment BitMEX Observes Increase in Attacks on Accounts, Stresses Security Measures |
A Look At The Intrinsic Value Of Liv ihop AB (publ) (STO:LIVI)
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Today we will run through one way of estimating the intrinsic value of Liv ihop AB (publ) (STO:LIVI) by taking the foreast future cash flows of the company and discounting them back to today's value. I will use the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
Check out our latest analysis for Liv ihop
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. Seeing as no analyst estimates of free cash flow are available to us, we have extrapolate the previous free cash flow (FCF) from the company's last reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF (SEK, Millions)", "2019": "SEK3.12", "2020": "SEK2.88", "2021": "SEK2.74", "2022": "SEK2.64", "2023": "SEK2.58", "2024": "SEK2.54", "2025": "SEK2.52", "2026": "SEK2.51", "2027": "SEK2.50", "2028": "SEK2.50"}, {"": "Growth Rate Estimate Source", "2019": "Est @ -10.93%", "2020": "Est @ -7.52%", "2021": "Est @ -5.13%", "2022": "Est @ -3.46%", "2023": "Est @ -2.29%", "2024": "Est @ -1.48%", "2025": "Est @ -0.9%", "2026": "Est @ -0.5%", "2027": "Est @ -0.22%", "2028": "Est @ -0.02%"}, {"": "Present Value (SEK, Millions) Discounted @ 6.7%", "2019": "SEK2.92", "2020": "SEK2.53", "2021": "SEK2.25", "2022": "SEK2.04", "2023": "SEK1.87", "2024": "SEK1.72", "2025": "SEK1.60", "2026": "SEK1.49", "2027": "SEK1.40", "2028": "SEK1.31"}]
Present Value of 10-year Cash Flow (PVCF)= SEK19.14m
"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 (0.4%) 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 6.7%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = kr2.5m × (1 + 0.4%) ÷ (6.7% – 0.4%) = kr40m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= SEKkr40m ÷ ( 1 + 6.7%)10= SEK20.99m
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 SEK40.12m. 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 SEK4.85. Relative to the current share price of SEK5.3, the company appears around fair value at the time of writing. 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.
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 Liv ihop 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 6.7%, which is based on a levered beta of 1.051. 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 Liv ihop, I've put together three essential factors you should further research:
1. Financial Health: Does LIVI have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of LIVI? 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 STO 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. |
Oil soars as US tensions with Iran grow over drone and tanker attacks
US Navy patrol boats carrying journalists to see damaged oil tankers. Photo: AP Photo/Kamran Jebreili Oil prices continued to rise on Monday morning as the United States prepares to announce new sanctions on Iran. Crude and brent prices have spiked in recent weeks after a US drone was shot down by Iran. The Iranian regime has also been accused of blowing up oil tankers. Brent futures ( BZ=F) were up around 0.8% at $65.69 a barrel at 9.30am on Monday, while crude ( CL=F) was up 0.7% to $57.84 a barrel. US secretary of state Mike Pompeo said “significant” new sanctions would be announced on Tehran on Monday. Trump said he called off a military strike against Iran on Friday after a US drone was shot down, saying he was “not looking for war.” READ MORE: Trump warns ‘Iran made a very big mistake’ Iran said the drone was over its territory, but the US said it was in international airspace. "There's a very firm tone to trading on well above average volumes," according to Michael McCarthy, chief market strategist at CMC Markets in Sydney. "We've got concerns about the sanctions against Iran, [but] we are seeing a better demand picture because of the actions of central banks, which is benefiting all commodities ... and we have got a weaker US dollar," McCarthy said. The rising tensions over recent events, as well as concerns over Iran’s nuclear programmes, saw Brent prices rise 5% last week, its first weekly gain in five weeks. Iran cannot have Nuclear Weapons! Under the terrible Obama plan, they would have been on their way to Nuclear in a short number of years, and existing verification is not acceptable. We are putting major additional Sanctions on Iran on Monday. I look forward to the day that..... — Donald J. Trump (@realDonaldTrump) June 22, 2019 ....Sanctions come off Iran, and they become a productive and prosperous nation again - The sooner the better! — Donald J. Trump (@realDonaldTrump) June 22, 2019 A US Navy personnel prepares at a patrol boat to carry journalists to see damaged oil tankers. Photo: AP Photo/Kamran Jebreili |
Market report: BMW-owners profit warnings, Boots bans bags, and £100m boost for windpower
The Mercedes-Benz logo is seen on a new car model at the 89th Geneva International Motor Show in Geneva, Switzerland March 5, 2019. Photo: REUTERS/Denis Balibouse Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad: Profit warning at BMW-owner Daimler Shares in German car maker Daimler ( DAI.DE ) fell over 4% on Monday after the BMW-owner issued its third profit warning in a year. Daimler issued a profit warning on Sunday, saying it was setting aside a “high three digit million amount” to cover the fallout from Diesel-gate, the scandal involving cheating emissions tests. Daimler also warned that its Mercedes Benz-Van division was also performing below expectations. As a result, Daimler said earnings for the year are now set to be flat. Over the weekend, Daimler was also ordered to recall 60,000 Mercedes-cars that were found to have emissions cheating software installed. Boots bans plastic bags 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. £100m boost for wind power The Offshore Wind Industry Council has launched a £100 million, 10-year programme to support UK businesses looking to capitalise on the growth in offshore wind around the world. Industry chairman of the council, Benj Sykes, said: “The offshore wind industry is offering multimillion-pound opportunities to hundreds of innovative companies throughout the UK in the years ahead, including new entrants to the market as well as firms already working in this area.” Justin Bowden, national officer of the GMB union, said potential benefits from the boom in offshore wind and renewables had “passed the UK workforce and economy by”. “Securing decent jobs in the renewables industry and its supply chain, and fairness in how decarbonisation costs are met, is now paramount,” Bowden said. Story continues Board exodus at De La Rue Banknote and passport-maker De La Rue ( DLAR.L ) has seen two more boardroom members quit just weeks after the chief executive headed for the door. Chairman Philip Rogerson and senior independent director Andy Stevens both said they plan to leave this year, less than a month after another profit warning hit the business. Rogerson said he would stay in place until a new chief executive has been appointed, and Stevens will leave no later than the end of the year. Taxpayers may pay to keep cash alive The UK government may have to step in and fund cash machines if rates of cash usage continue to decline, according to a new report. The Future of Finance report warned that people who rely on cash could struggle to access it in future if rates of cash usage continue to decline. “It may be necessary for the state to support the cash economy as a public good, as without this, the incentives for many actors will be to reduce the use cash,” the report said. Europe markets hover European markets were mixed on Monday, with Daimler’s profit warning hitting the DAX while a rally for oil helps the FTSE. Britain's FTSE 100 ( ^FTSE ) was up by 0.1%, by Germany's DAX ( ^GDAXI ) was down by 0.5%, France's CAC 40 ( ^FCHI ) was down by 0.1%, and the Euronext 100 ( ^N100 ) was flat. Asian markets were quiet. Japan's Nikkei 225 ( ^N225 ) ended up 0.1%, Hong Kong's Hang Seng index ( ^HSI ) was up by 0.1%, and China's benchmark Shanghai Composite ( 000001.SS ) was up by 0.2%. What to expect in the US US stock futures were pointing to a quiet open. S&P 500 futures ( ES=F ) were up by 0.2%, Dow Jones Industrial Average futures ( YM=F ) were up by 0.2%, and Nasdaq futures ( NQ=F ) were up by 0.3%. |
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What Does Muehlhan AG's (ETR:M4N) Balance Sheet Tell Us About It?
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Investors are always looking for growth in small-cap stocks like Muehlhan AG (ETR:M4N), with a market cap of €56m. However, an important fact which most ignore is: how financially healthy is the business? 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. We'll look at some basic checks that can form a snapshot the company’s financial strength. Nevertheless, this is not a comprehensive overview, so I suggest youdig deeper yourself into M4N here.
M4N has sustained its debt level by about €33m over the last 12 months – this includes long-term debt. At this constant level of debt, the current cash and short-term investment levels stands at €11m to keep the business going. Additionally, M4N has generated cash from operations of €11m in the last twelve months, resulting in an operating cash to total debt ratio of 34%, signalling that M4N’s operating cash is sufficient to cover its debt.
At the current liabilities level of €66m, it seems that the business has been able to meet these obligations given the level of current assets of €85m, with a current ratio of 1.28x. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for Construction companies, this is a reasonable ratio since there's a sufficient cash cushion without leaving too much capital idle or in low-earning investments.
With a debt-to-equity ratio of 49%, M4N 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 test if M4N’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 M4N, the ratio of 6.53x suggests that interest is appropriately covered, which means that debtors may be willing to loan the company more money, giving M4N ample headroom to grow its debt facilities.
Although M4N’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 M4N's liquidity needs, this may be its optimal capital structure for the time being. Keep in mind I haven't considered other factors such as how M4N has been performing in the past. You should continue to research Muehlhan to get a better picture of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for M4N’s future growth? Take a look at ourfree research report of analyst consensusfor M4N’s outlook.
2. Valuation: What is M4N 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 M4N 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. |
India taking more U.S. coking coal, pushing out Australia -Xcoal
NUSA DUA, Indonesia, June 24 (Reuters) - India is buying more U.S. coking coal after disruptions in top supplier Australia, and as U.S. miners seek new markets due to declining demand from America's steel industry, an executive at Xcoal Energy & Resources India said on Monday.
Interruptions to Australian supply have worsened in the past few years, driving Indian steelmakers to seek new sources of coking coal, Durgesh Pathak, Xcoal marketing manager, said.
"On the Australian side, there have been a lot of challenges in terms of breakdown at the mines," Pathak told Reuters on the sidelines of the Coaltrans conference in Bali.
"Also Australia is becoming more unpredictable in terms of cyclones," he said. Xcoal, a privately held coal marketing and logistics company, is headquartered in the United States.
A fire at coal miner Peabody Energy's operations in the state of Queensland late last year disrupted supplies for three months. And floods in Australia's major coal-producing region in February damaged several rail lines and disrupted shipments.
Cyclone Debbie, which tore into Queensland in the first quarter of 2017, was another "classic example" of the dangers of depending on a single supply source, Pathak said.
"In a matter of a few days, the prices went up by almost 100 percent," he said.
Pathak sees India's demand for coking coal, used in steelmaking, growing by 4 million to 5 million tonnes this year. The growth of India's U.S. coking coal imports, however, will outstrip that growth, rising by 7 million to 8 million tonnes at least, displacing volumes from Australia, he said.
In accessing coal from the United States, Indian producers get access to a wider array of coal grades, he said.
U.S. producers, driven out of their domestic market by sluggish demand from their own steel industry, are also paying the freight differential between the United States and Australia to sweeten the deal, he said.
"The U.S. is eating up the freight differential. Some are not going to pay even $2 more ... It is not economic but it is competitive," Pathak said.
"There is a strong possibility that the participation of U.S. coking coal could be even higher." (Reporting by Melanie Burton; Editing by Tom Hogue) |
$11,000 and Climbing: Bitcoin Is Experiencing a 'Fairly Extraordinary' Bounce-Back
Bitcoin traded above $11,000 for the first time in 15 months, recouping more than half of the parabolic increase that captured the attention of mainstream investors before the cryptocurrency bubble burst last year.
“The bounce-back of Bitcoin has been fairly extraordinary,” said George McDonaugh, chief executive and co-founder of London-based blockchain and cryptocurrency investment firm KR1 Plc. “Money didn’t leave the asset behind, it just sat on the sidelines waiting to get back in.”
Bitcoin surged as high as $11,251.21 on Monday, a 13% gain from late Friday that put it at the highest levels since March 2018. It was at $10,797.91 as of 1:28 p.m. in Hong Kong.
The largest cryptocurrency had a furious run higher in late 2017 that culminated with a top above $19,500, before an almost-as-relentless move downward over much of 2018. It languished around the $3,300 to $4,100 range for several months.
Bitcoin’s ride back accelerated in April, puzzling onlookers trying to pinpoint a reason for the surge. A study by Indexica, an alternative data provider, showed three main drivers: a more complex conversation surrounding Bitcoin, fewer concerns about fraud and a shift in the tense of how Bitcoin is talked about from the past to the future.
“The market has matured greatly since the last time Bitcoin crossed $10,000,” said Matt Greenspan, a senior market analyst at eToro. “This run is far more justified given the current level of adoption.”
In contrast with last year, there are now signs of renewed mainstream interest in cryptocurrencies and the underlying blockchain technology, most prominentlyFacebookInc.’s Libra. The social-media giant is working with a broad group of partners fromVisaInc. to Uber Technologies Inc. to develop the system, which has already attracted attention and criticism from politicians raising privacy and security concerns.
The advent of Libra “is validating the crypto space and sending all the major digital coins higher,” said Edward Moya, chief market strategist at Oanda Corp. in New York. “Bitcoin volatility is likely to persist, with $12,000 and $15,000 as the next two critical resistance levels.”
Crypto-related stocks advanced as well. GMO Internet Inc. rose 7% in Tokyo to its highest level since October. Remixpoint Inc. gained 9.2%, Metaps Inc. advanced 7.5% and Ceres Inc. increased 5%.
Still, the speed of the rally has some observers warning caution is once again warranted.
To Whitney Tilson, founder of Empire Financial Research and a former hedge-fund manager, Bitcoin is “exhibit A” in the lexicon of “scams that enrich insiders at the expense of average folks.”
“Don’t get fooled by the dead-cat bounce this year,” Tilson said in comments last week. “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.” |
How Much is Ymagis Société Anonyme's (EPA:MAGIS) CEO Getting Paid?
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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. After that, we will consider the growth in the business. 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.
See our latest analysis for Ymagis Société Anonyme
Our data indicates that Ymagis Société Anonyme is worth €9.6m, and total annual CEO compensation is €120k. (This is based on 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. 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 a visual representation of the CEO compensation at Ymagis Société Anonyme, below.
On average over the last three years, Ymagis Société Anonyme has shrunk earnings per share by 4.7% each year (measured with a line of best fit). Its revenue is down -7.1% over last year.
Sadly for shareholders, earnings per share are actually down, over three years. And the impression is worse when you consider revenue is down year-on-year. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Since shareholders would have lost about 87% over three years, some Ymagis Société Anonyme shareholders would surely be feeling negative emotions. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
Remuneration for Jean-Marc Mizrahi is close enough to the median pay for a CEO of a similar sized company .
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 Ymagis Société Anonyme.
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 L.G. Balakrishnan & Bros Limited (NSE:LGBBROSLTD) A High Quality Stock To Own?
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Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand L.G. Balakrishnan & Bros Limited (NSE:LGBBROSLTD).
Over the last twelve monthsL.G. Balakrishnan & Bros has recorded a ROE of 15%. One way to conceptualize this, is that for each ₹1 of shareholders' equity it has, the company made ₹0.15 in profit.
Check out our latest analysis for L.G. Balakrishnan & Bros
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for L.G. Balakrishnan & Bros:
15% = ₹996m ÷ ₹6.8b (Based on the trailing twelve months to March 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is the capital paid in by shareholders, plus any retained earnings. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the yearly profit. That means that the higher the ROE, the more profitable the company is. So, all else equal,investors should like a high ROE. That means ROE can be used to compare two businesses.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As you can see in the graphic below, L.G. Balakrishnan & Bros has a higher ROE than the average (11%) in the Machinery industry.
That's what I like to see. In my book, a high ROE almost always warrants a closer look. For exampleyou might checkif insiders are buying shares.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
L.G. Balakrishnan & Bros has a debt to equity ratio of 0.32, which is far from excessive. I'm not impressed with its ROE, but the debt levels are not too high, indicating the business has decent prospects. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better.
But when a business is high quality, the market often bids it up to a price that reflects this. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to check this FREEvisualization of analyst forecasts for the company.
Of courseL.G. Balakrishnan & Bros may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
German business sentiment lowest since November 2014: Ifo
By Joseph Nasr
BERLIN (Reuters) - German business morale fell to its lowest level since November 2014 in June, a survey showed on Monday, adding weight to expectations that Europe's largest economy contracted in the second quarter.
The Ifo institute said its business climate index deteriorated for the third month in a row, to 97.4 in June from 97.9 in May. That was slightly above a consensus forecast for 97.2.
"The German economy is heading for the doldrums," Ifo President Clemens Fuest said, adding that the business climate in both the manufacturing and services sectors had worsened.
After nine successive years of growth, the German economy is struggling as trade disputes and a cooling world economy hurt its export-dependent manufacturers and as Britain's delayed exit from the European Union creates uncertainties.
The Bundesbank said this month it expects the economy to contract slightly in the second quarter after an expansion of 0.4% between January and March. The government has halved its 2019 growth forecast to 0.5% after an expansion of 1.5% in 2018, the weakest rate in five years.
Ifo economist Klaus Wohlrabe said the trade conflict between the United States and China -- the world's two largest economies -- was the main source of uncertainty for German businesses.
He said he did not expect a recession, a view also held by analysts.
"All told, we expect the German economy to slow to little more than a crawl in the second quarter," Christina Iacovides of Capital Economics wrote in a note.
'FEAR OF LOSING'
An index measuring managers' assessment of their current situation rose slightly while another gauging expectations fell to its lowest level since February.
That suggested the slump in the headline reading to levels not seen since the euro zone debt crisis was driven by concerns that trade conflicts between the United States and both China and the European Union could worsen and further dampen exports.
"Fear of losing. This is the best summary of the current state of Germany's businesses," Carsten Brzeski of ING wrote in a note.
The services sector, buoyed by a solid domestic economy, has been providing impetus as industry shrinks, but some economists fear the recession in the manufacturing sector could spread.
The economy has been relying on private consumption for growth, a cycle supported by a robust labour market, low interest rates and rising wages. Separate data published on Monday showed that real wages rose at a slower pace in the first quarter, however, which could dampen Germans' appetite to spend. [L8N23V1W5]
Higher government spending has also helped support growth but critics of Chancellor Angela Merkel's right-left coalition say it could borrow money to add more impetus. Business lobby groups have urged Merkel to cut corporate taxes and some economists accuse her of being complacent about the economy.
The Finance Ministry said on Monday the government would stick to its no-new-debt policy until 2023 but planned to increase public spending by 1% next year.
Brzeski said he expected the services sector to continue providing impetus for the broader economy and that the slowdown in the manufacturing sector would bottom out.
The European Central Bank's decision not to raise interest rates in the next year and to open the door to cutting them or buying more bonds could cement the status of consumption as the main growth driver in Germany, he added.
"A bottoming-out is in sight for German industry," Brzeski said. "The recent u-turn of the ECB towards more dovishness indicates that financing conditions for new domestic investments will remain favourable. However, let's be clear, a bottoming out is still far from being a strong rebound."
(Reporting by Joseph Nasr; Editing by Michelle Martin and Catherine Evans) |
CINDX Blockchain-Based Fund Management Ecosystem Announces Launch
NEW YORK, NY / ACCESSWIRE /June24, 2019 /The CINDX project platform is a revolutionary ecosystem designed to cater to a broad range of crypto market participants seeking to make profit on their professional skills and portfolios. The project is announcing the launch of the main stage of its fundraising campaign and welcomes all to join and take advantage of the value offering its product has.
The bear market of 2018 has not deterred many crypto investors from seeking ways of monetizing their portfolios and continuing to operate on exchanges. The current trading volume has exceeded the hype levels of 2017, even though 2018 was a bearish year. This means that trading is developing and gaining momentum, despite the bear market conditions.
The CINDX platform operates on a comprehensive and advanced set of algorithms that allows it to select the best trading strategies applied by traders using its own rating system and add them to the marketplace. The rating system that CINDX applies is unique and guarantees the accuracy and transparency of the trader's rating on the platform by analyzing their trading history on the basis of several parameters, including risk. The CINDX platform uses segmented and combined ratings to reflect the full and weighted position of the Manager in the system. The basis for calculating the rating is the trading history recorded on the blockchain, thus ensuring transparency.
Investors have the freedom of choosing the strategies that are optimal for them via their personal exchange accounts without any transfers of funds. Once the strategy has been selected and the Manager offering it, the Investor only needs to follow that Manager and watch the magic unfold. The Manager, in turn, receives payment only after their followers actually make a profit. All the funds of the Investors are stored on their personal accounts on the exchange, and they are not transferred either to the trader or to the platform, thus guaranteeing security and preventing fraud.
CINDX is a rapidly developing platform with a working product, which aims to incorporate more add-ons in the near future. The CINDX project team is composed of highly experienced professionals from a variety of industries who have decided to develop a product that would cater to both traders and investors. Top strategies showcasing excellent results of profitability have already been tested and launched. From January to May, 2019 100 strategies of various traders were analyzed, 14 were filtered and 12 have proven to be profitable. The total profit achieved on the basis of these strategies was 18.6% in BTC and 86% in USDT. The crypto market is developing rapidly and the CINDX platform aims to be at the forefront of market liquidity turnover.
The CINDX fundraising campaign will be the first fully legal event taking place under EU legislation. Joint Stock Company CINDX Investkapital AS operates in accordance with Directive EU843 / 2018 dated May 22, 2018, which allows the provision of online financial services worldwide, except for FATCA countries and countries with a potential terrorist threat. For more details on the sale and information about CINDX, visit the project website or any of their social media channels.
mengyan416@gmail.com
SOURCE:CINDX
View source version on accesswire.com:https://www.accesswire.com/549643/CINDX-Blockchain-Based-Fund-Management-Ecosystem-Announces-Launch |
CIEF 2019 was Concluded, Bringing Together Global Science and Technology Projects and Jointly Building the Collaborative Innovation platform
SHENZHEN, CHINA / ACCESSWIRE /June24, 2019 /The China Innovation and Entrepreneurship Fair 2019 (CIEF) was officially concluded on June 23. This year's CIEF received extensive support. Many well-known enterprises, universities, research institutes and science and technology associations at home and abroad organized upwards of 1,200 achievements projects for exhibition. The focus is on AI, new-generation IT, new energy, new materials, biotechnology, smart cars and other high-tech leading-edge industries. This CIEF exhibits the state-of-the-art technologies and products in hot areas such as smart driving, IoT, smart city, mobile medical, 5G, bioenergy, electronic information materials, and new functional materials. During the CIEF, more than 30 special events have been held, including keynote speeches, special reports, roundtable discussions, academic exchanges, auctions on achievements, and events of popular innovation and entrepreneurship, including matchmaking activities and roadshow promotion events to promote project application; outlook of future development trend of science and technology, forum salons that analyze and judge the development directions of the industries; and international innovation and entrepreneurship competitions that guide venture capital to find investment projects and support entrepreneurial teams.
The Fair fosters international cooperation and exchanges, and promotes the win-win integration of science and technology at home and abroad.More than 150 foreign tech companies, innovation carriers, technology associations, and research institutes from over 20 countries including the U.S., Britain, Israel, South Korea, Australia, Germany, and France entered the exhibition with 250 projects. More than 40 well-known foreign scientists and entrepreneurs including Andre Geim, Nobel laureate in Physics in 2010, the "Father of graphene" and academician of the American National Academy of Sciences (NAS), served as the guests at the special activities. China-UK Industry-University-Research Institute Cooperation Forum, the Matchmaking Meeting for Israeli projects, and others promoted cooperation and exchange of projects at home and abroad, and the matchmaking and transformation. The fair sets up an international platform for technology exchange, promotes the application of outstanding international projects and creates more opportunities for international cooperation. DEXTERIS of Israel created a partner ecosystem in Guangdong through the CIEF, and, together with such units as South China Agricultural University, jointly filed for the international cooperation project which was approved by the Agricultural and Rural Affairs Department of Guangdong Province; and forged strategic partnership with Guangdong Zhanjiang State Farms Group at the CIEF achievement promotion conference for joint development of pineapple-picking robots.
Add：7#, Qianhai Shenzhen-Hong Kong Youth Innovation and Entrepreneur Hub, Nanshan District, Shenzhen (518000)
Website:https://www.chinaief.cn
Email:Vesper_Qin@idgchina.com.cn
SOURCE:IDG Asia
View source version on accesswire.com:https://www.accesswire.com/549644/CIEF-2019-was-Concluded-Bringing-Together-Global-Science-and-Technology-Projects-and-Jointly-Building-the-Collaborative-Innovation-platform |
Is Ashoka Buildcon Limited (NSE:ASHOKA) Excessively Paying Its CEO?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! In 2006 Satish Parakh was appointed CEO of Ashoka Buildcon Limited ( NSE:ASHOKA ). 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 Ashoka Buildcon How Does Satish Parakh's Compensation Compare With Similar Sized Companies? Our data indicates that Ashoka Buildcon Limited is worth ₹38b, and total annual CEO compensation is ₹42m. (This is based on the year to March 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at ₹31m. We looked at a group of companies with market capitalizations from ₹14b to ₹56b, and the median CEO total compensation was ₹23m. It would therefore appear that Ashoka Buildcon Limited pays Satish Parakh more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous. You can see, below, how CEO compensation at Ashoka Buildcon has changed over time. NSEI:ASHOKA CEO Compensation, June 24th 2019 Is Ashoka Buildcon Limited Growing? Ashoka Buildcon Limited has increased its earnings per share (EPS) by an average of 23% a year, over the last three years (using a line of best fit). It achieved revenue growth of 37% over the last year. This shows that the company has improved itself over the last few years. Good news for shareholders. The combination of strong revenue growth with medium-term earnings per share improvement certainly points to the kind of growth I like to see. You might want to check this free visual report on analyst forecasts for future earnings . Story continues Has Ashoka Buildcon Limited Been A Good Investment? I think that the total shareholder return of 48%, over three years, would leave most Ashoka Buildcon Limited shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size. In Summary... We compared total CEO remuneration at Ashoka Buildcon 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. Importantly, though, the company has impressed with its earnings per share growth, over three years. On top of that, in the same period, returns to shareholders have been great. So, considering this good performance, the CEO compensation may be quite appropriate. So you may want to check if insiders are buying Ashoka Buildcon shares with their own money (free access). Important note: Ashoka Buildcon may not be the best stock to buy. You might find something better in this list 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 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 Think About Buying McLeod Russel India Limited (NSE:MCLEODRUSS) Now?
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McLeod Russel India Limited (NSE:MCLEODRUSS), which is in the food business, and is based in India, received a lot of attention from a substantial price movement on the NSEI over the last few months, increasing to ₹88.5 at one point, and dropping to the lows of ₹17.1. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether McLeod Russel India's current trading price of ₹17.1 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at McLeod Russel India’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
View our latest analysis for McLeod Russel India
Great news for investors – McLeod Russel India is still trading at a fairly cheap price. 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 0.71x is currently well-below the industry average of 17x, meaning that it is trading at a cheaper price relative to its peers. Another thing to keep in mind is that McLeod Russel India’s share price is 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 kind of returns can we expect from McLeod Russel India in the future? It’s one thing to get a stock at a low price, but the quality of the company is even more important, as its stock may be cheap or expensive for a reason. We can determine the quality of a stock many ways; one way is to look at how much return it generates relative to the money we’ve invested in the stock. McLeod Russel India is expected to return 3.0% of your investment in the next couple of years if you buy the stock today. This is a pretty average return, which doesn’t significantly add much to the case for owning the stock.
Are you a shareholder?Although MCLEODRUSS is currently undervalued, the low future return begs the question – is there a better opportunity elsewhere? Consider whether you want to increase your portfolio exposure to MCLEODRUSS, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor?If you’ve been keeping an eye on MCLEODRUSS for a while, but hesitant on making the leap, I recommend you dig deeper into the stock. Since it is currently undervalued, now is a great time to make a decision. But keep in mind the low future return, and whether the opportunity cost of investing in MCLEODRUSS versus another stock is worth it.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on McLeod Russel India. You can find everything you need to know about McLeod Russel India inthe latest infographic research report. If you are no longer interested in McLeod Russel India, 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. |
Tennis greats applaud Barty's rise to No. 1
SYDNEY (AP) Australia's greatest female tennis players, Margaret Court and Evonne Goolagong Cawley, have joined in celebrating the rise of compatriot Ashleigh Barty to the No. 1 world ranking which they both held. Barty became the first Australian woman in more than 40 years to take the top ranking by claiming her third title of 2019 on Sunday in Birmingham. Her mentor and idol Goolagong Cawley, who won seven grand slams, was the first in 1976. The WTA rankings were introduced in 1973. "In 2019, with all the pieces in place, her rise has been almost unstoppable," Goolagong Cawley said in a statement on Monday. "Ash is a very worthy No. 1 and winning at the French will have given her even more confidence. "I am so proud that another Aboriginal player sits on top of the rankings in women's tennis, particularly a young lady who conveys such happiness in all she does." Court, who won 24 grand slams, said the challenge for Barty was to stay at No. 1. "It was always easier climbing up the ladder than staying there," Court said. "That's a real champion to stay at the top." Compatriot Sam Stosur, who won the 2011 U.S. Open, said Barty's attitude will serve her well as she goes into Wimbledon next week as the top seed. "She is playing fantastic and grass is a surface that she openly says she can't wait to get on every year," Stosur said. "I don't think she went to the French thinking she had a shot which is maybe why she went there and put no pressure on herself. "She was just playing it and enjoying it and getting through the rounds and suddenly she's won a grand slam. "Wimbledon will be a different scenario." Tennis Australia chief executive Craig Tiley said Barty could win another grand slam title this year if she avoids injury. "The top women players aren't used to the type of game that she has," Tiley said. "That's what is putting her at a high level quickly - while the other players figure out how to play her I think they will continue to struggle." The great Billie Jean King congratulated Barty on Twitter. "With incredible versatility, perseverance, and focus, Ash Barty is an inspiration to the next generation of young players in Australia. "Well done!" King tweeted. ___ More AP Tennis: https://www.apnews.com/apf-Tennis and https://twitter.com/AP_Sports View comments |
Lufthansa eyes cost cuts to return Eurowings to profit
By Ilona Wissenbach and Michelle Martin
FRANKFURT/BERLIN (Reuters) - Lufthansa's budget airline Eurowings will aim to cut costs by 15% over the next three years and focus on short-haul flights as part of a plan to return to profit by 2021, the German carrier said on Monday.
Lufthansa cited falling revenues at Eurowings as a major reason behind a profit warning on June 16. Eurowings' revenue was forecast to drop sharply in the second quarter.
Eurowings expanded last year as it took over large parts of Air Berlin but is making a loss as it faces tough price competition from Ryanair, easyJet and Wizz in Europe.
Lufthansa said its Eurowings fleet would consist only of planes from the A320 family in future and it would seek to boost productivity at Eurowings by limiting itself in Germany to one air operator's certificate from four currently - a move that should reduce its administrative and personnel costs.
Eurowings' long-haul business will also be managed by Lufthansa in future.
Lufthansa earlier this month cut its expectations for annual earnings before interest and taxes to 2.0-2.4 billion euros ($2.3-$2.7 billion) from 2.4-3.0 billion euros previously.
Chief Executive Carsten Spohr told an investor conference in Frankfurt on Monday that management had underestimated how complicated it would be to integrate Air Berlin into Eurowings, adding: "They had too much to do in too little time."
Brussels Airlines - the Belgian national flag carrier which Lufthansa took control of in 2016 - will therefore not be integrated into Eurowings, Lufthansa said. A turnaround plan for Brussels Airlines will be announced in the third quarter.
Lufthansa also said on Monday it would start pegging its dividend payout ratio to net profit to give the group more flexibility. It will pay out a regular dividend of 20-40% of net profit, adjusted for one-off gains and losses.
Spohr said Monday's announcements sent "a clear signal that this company cares about its shareholders and tries to create value for them".
Lufthansa shares were down 1.05% at 1341 GMT.
Lufthansa said its Network Airlines - made up of Lufthansa, Swiss and Austrian Airlines - would aim to use innovations in sales and distribution to help increase unit revenues by 3% by 2022.
Network Airlines will try to reduce unit costs by 1-2% a year, it added.
Network Airlines Chief Commercial Officer Harry Hohmeister told Lufthansa's capital markets day the network wanted to expand its small market share in Africa and South America and boost turnover by 50% to almost 900 million euros by 2022.
(Writing by Michelle Martin; Editing by Jane Merriman and Mark Potter) |
Full list of 53 Boots stores that will now use paper bags instead of plastic ones
Photo credit: SOPA Images / - Getty Images From Country Living Boots has announced that it will be replacing plastic bags with paper alternatives in 53 of its UK stores from 2020. See full list below... New brown paper bags will be sold for 5p, 7p and 10p (depending on their size), and the profits will be donated to BBC's Children in Need . The hope is that all Boots stores across the country will soon follow this initiative. The popular high street chemist has explained that it is part of the company's plan to cut back on 900 tonnes of plastic. "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 haven't brought their own bags with them when shopping," Helen Normoyle, director of marketing at Boots explained to The Express . Boots Managing Director Seb James also commented, saying: "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." Want to know if your local Boots will offer paper bags? See below for the full list. The 53 Boots stores introducing paper bags Nottingham Victoria Centre Derby Intu Shopping Centre Sheffield Meadowhall Shopping Centre Cambridge Petty Cury, Peterborough Queensgate Centre Manchester Trafford Centre London Canary Wharf Canada Bristol Broadmead Milton Keynes Crown Walk, Exeter High Street Cardiff Queen Street Oxford Cornmarket Street Plymouth Drake Circus Leeds Trinity Belfast Donegal Place Edinburgh 101 Princes Street Aberdeen Bon Accord Centre Newcastle Eldon Square London Sedley Place London Brent Cross Shopping Centre London Liverpool St Station Watford The Harlequin Bromley The Glades Shopping Centre Kingston Upon Thames Union Street London Kensington Southampton Above Bar Street West Thurrock Lakeside Shopping Centre Brighton North Street Jersey St Helier Queen Street London Piccadilly Circus Dartford Bluewater Park London 193 Oxford Street Liverpool Clayton Square Shopping Centre Manchester Market Street Birmingham High Street Canterbury Whitefriars Shopping Centre Chelmsford High Chelmer London White City Shopping Centre York 43 Coney Street Bath Southgate Centre London Stratford City Dudley Merry Hill Centre Bristol Cribbs Causeway Reading Oracle Centre Lincoln High Street Gateshead Metro Centre Salcombe Fore Street Glasgow Braehead Centre Glasgow Buchanan Gallery Liverpool New Mersey Retail Park Leicester Fosse Park Glasgow Fort Covent Garden Story continues Like this article? Sign up to our newsletter to get more articles like this delivered straight to your inbox. SIGN UP ('You Might Also Like',) Emma Bridgewater partners with Russell Hobbs to create stunning kitchen range Everything you need to buy once and for all to eliminate single-use plastic from your life |
Is L.G. Balakrishnan & Bros Limited (NSE:LGBBROSLTD) A High Quality Stock To Own?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine L.G. Balakrishnan & Bros Limited (NSE:LGBBROSLTD), by way of a worked example.
Our data showsL.G. Balakrishnan & Bros has a return on equity of 15%for the last year. One way to conceptualize this, is that for each ₹1 of shareholders' equity it has, the company made ₹0.15 in profit.
Check out our latest analysis for L.G. Balakrishnan & Bros
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for L.G. Balakrishnan & Bros:
15% = ₹996m ÷ ₹6.8b (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, all else equal,investors should like a high ROE. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As you can see in the graphic below, L.G. Balakrishnan & Bros has a higher ROE than the average (11%) in the Machinery industry.
That is a good sign. I usually take a closer look when a company has a better ROE than industry peers. For exampleyou might checkif insiders are buying shares.
Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Although L.G. Balakrishnan & Bros does use debt, its debt to equity ratio of 0.32 is still low. Although the ROE isn't overly impressive, the debt load is modest, suggesting the business has potential. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is one way we can compare the business quality of different companies. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt.
But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of 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. |
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The 50 Best Places To Retire — and What It Costs To Live There
If you’re thinking about leaving the rat race, you’ll inevitably wonder about the best places to retire in the U.S. Finding the right city is essential, especially if you want to get the most out of your retirement nest egg.
To make your life easier, GOBankingRates identified the 50 best American cities to spend your golden years and provided the annual retirement costs for both homeowners and renters in each city. However, more than just home prices went into this study — GOBankingRates took into account everything from grocery and healthcare expenses to taxes and crime rates.
So, if you’re getting ready to say goodbye to the workforce, make sure to review your best options for retirement.
• Annual retirement costs for homeowners:$36,215.62
• Annual retirement costs for renters:$39,839.62
It’s not surprising that Columbia made GOBankingRates’ list of the best places to retire. Thanks to low median mortgage and rent payments, at $1,335 and $1,637 per month, respectively, retirement costs are manageable in this city.
• Annual retirement costs for homeowners:$46,716.49
• Annual retirement costs for renters:$42,276.49
Although Ventura doesn’t offer rock-bottom prices for your median monthly rent or mortgage, retirees in this city will still find annual costs for groceries and healthcare — at $3,831.79 and $6,244.40, respectively — to be quite cheap.
• Annual retirement costs for homeowners:$47,562.46
• Annual retirement costs for renters:$39,438.46
Although the median house price in Garden Grove doesn’t come cheap at $617,000, along with an annual mortgage bill of $28,248, the yearly cost of groceries is on the low end at $3,921.62. Utilities are relatively inexpensive in this city as well, at $3,647.15 per year.
• Annual retirement costs for homeowners:$47,627.09
• Annual retirement costs for renters:$42,923.09
Santa Rosa is another California city that’s great for retirees, but it’s not because of the median home list price of $619,750 or the average monthly rent of $1,972. Groceries and utilities aren’t expensive at $4,327.85 and $3,717.71 per year, respectively. And, you’ll be close to plenty of wineries in this beautiful Sonoma County suburb.
• Annual retirement costs for homeowners:$27,487.16
• Annual retirement costs for renters:$30,967.16
Watch out for healthcare costs in Hampton — at $7,638 per year, it’s the second-most expensive city for this expense out of all the cities on GOBankingRates’ list. However, there are other financial benefits to living in Hampton that might make up for the high cost of healthcare. It boasts the cheapest annual retirement costs for homeowners, as well as the fifth-cheapest overall costs for renters.
• Annual retirement costs for homeowners:$41,748.03
• Annual retirement costs for renters:$39,216.03
Retire in Centennial, and you’ll enjoy low retirement costs whether you’re a renter or a homeowner. Beware of healthcare costs in this city, however, as they are on the high end at $6,579.40 per year. Additionally, Centennial has rather expensive transportation costs at $6,104.96 annually.
• Annual retirement costs for homeowners:$45,295.24
• Annual retirement costs for renters:$40,507.24
Overall expenses for renters and homeowners are pretty average in Oceanside compared to the rest of the cities in GOBankingRates’ study, but if you’re looking to buy when you retire, consider the fact that the median home list price in this city is on the high end at $573,990.
• Annual retirement costs for homeowners:$41,781.01
• Annual retirement costs for renters:$36,657.01
Transportation and healthcare costs don’t come cheap in Arvada at $6,114.03 and $6,425.30, respectively, but utility and food costs fall toward the middle of the pack. The median rent is $1,404 per month, which is a reasonable price, too.
• Annual retirement costs for homeowners:$34,194.41
• Annual retirement costs for renters:$32,766.41
With a median home list price of $299,900 and a median rent price of $1,025 per month, Las Vegas is a solid choice for those who want to retire in a city with cheap costs. Just make sure you don’t spend too much time in the casinos with all the money you’d save if you moved to Sin City.
• Annual retirement costs for homeowners:$29,360.04
• Annual retirement costs for renters:$33,440.04
At only $3,812.76 per year, Rochester has the lowest annual cost of transportation among all the cities on GOBankingRates’ list. It also boasts a decent median home list price of $276,900 and offers reasonable healthcare costs at $5,641.40 annually.
Read More:The 50 Best Places To Retire Across Middle America
• Annual retirement costs for homeowners:$43,943.21
• Annual retirement costs for renters:$41,987.21
Fort Lauderdale has relatively high prices for transportation and healthcare, at $7,035.45 and $6,432, respectively, but you’ll spend only $3,580.30 on utilities and $4,011.46 on groceries annually. If you want to buy a home, however, get ready for a hefty median price tag of $499,900.
• Annual retirement costs for homeowners:$48,885.41
• Annual retirement costs for renters:$43,809.41
Another California city that has relatively expensive homes is West Covina, at a median list price of $585,000. But it’s easier to save up for a home since annual food and utility costs — at $3,921.62 and $3,788.28, respectively — are in line with most of the cities on GOBankingRates’ list. That said, transportation costs in West Covina are the highest — you can expect to pay $8,683.11 per year.
• Annual retirement costs for homeowners:$64,362.18
• Annual retirement costs for renters:$44,778.18
Bellevue residents pay only $2,636.94 per year for utilities, which is the cheapest bill among the best cities to retire. And, if you’re concerned about healthcare costs in retirement, note that you’ll pay less for healthcare in Bellevue than anywhere else on this list at $5,473.90 annually.
• Annual retirement costs for homeowners:$43,651.42
• Annual retirement costs for renters:$42,595.42
Although Miami has a high transportation cost of $7,702.68 per year, its surprisingly low median home list price of $475,000 might still make it very attractive to retirees. Plus, this popular retirement city in southern Florida features wide beaches that go on for practically forever.
• Annual retirement costs for homeowners:$32,674.76
• Annual retirement costs for renters:$37,726.76
If you can’t afford to retire in Miami, consider Pompano Beach — the median home list price is only $253,500, and the median monthly rent is $1,388. Watch out for transportation costs, however, which will cost you $7,058.15 annually.
• Annual retirement costs for homeowners:$28,135.09
• Annual retirement costs for renters:$29,995.09
Corpus Christi boasts the cheapest overall retirement costs for renters. At just $3,417.75 per year, it also offers the least expensive groceries among all the cities on GOBankingRates’ list. If that’s not enough to convince you, consider the median rent of $975 per month and the median home list price of $215,000.
Don’t Miss:These Southern Hidden Gems Are Perfect for Retirees
• Annual retirement costs for homeowners:$62,592.67
• Annual retirement costs for renters:$52,092.67
While Pasadena is one of the best places to retire in California, it’s still on the high end in, well, every category. The median home list price is $897,000, the median rent is $2,547 per month, and the annual transportation cost is steep at $8,147.
• Annual retirement costs for homeowners:$34,631.29
• Annual retirement costs for renters:$38,459.29
With a low median home list price of $298,000 as well as reasonable grocery and utility costs at $4,011.46 and $3,606.29, respectively, West Palm Beach is one of the best retirement cities in the Sunshine State. And, that’s not even taking into account this southern Florida city’s world-class entertainment, restaurant and shopping opportunities.
• Annual retirement costs for homeowners:$47,010.79
• Annual retirement costs for renters:$41,538.79
Simi Valley is another California city where the median home list price is high at $610,000. But, if you decide to retire here, you’ll have reasonable annual grocery and utility bills at $3,831.79 and $3,777.14, respectively. Your healthcare cost of $6,244.40 per year also won’t be too steep.
• Annual retirement costs for homeowners:$60,319.91
• Annual retirement costs for renters:$48,619.91
Burbank’s median home list price of $849,000 is relatively high. However, food and utility costs land toward the middle of the pack, and annual healthcare costs are surprisingly low at $5,708.40.
• Annual retirement costs for homeowners:$85,144.88
• Annual retirement costs for renters:$60,556.88
It would cost you an average of $1,389,000 to get into the real estate market in San Mateo — the most expensive median home list price on GOBankingRates’ list. And, the median rent is also the highest at $3,250 per month. However, groceries and utilities are reasonably priced in San Mateo, and healthcare will run you $6,499 per year.
• Annual retirement costs for homeowners:$62,974.32
• Annual retirement costs for renters:$52,522.32
Residents in Daly City, one of the best places to retire in California, pay only $3,201.47 per year for utilities. It’s the lowest amount among all the U.S. cities in this study. However, groceries — at $4,327.85 per year — will cost you a little more compared to what you’d pay in many other cities.
• Annual retirement costs for homeowners:$29,882.98
• Annual retirement costs for renters:$32,666.98
A low median home list price of $255,000 and a cheap median monthly rent of $1,205 make Tyler a great place for Americans on a budget — it’s one of the top retirement cities. Healthcare is rather expensive at $7,128.80 per year, but food, utility and transportation costs are all relatively cheap.
• Annual retirement costs for homeowners:$32,460.57
• Annual retirement costs for renters:$35,848.57
St. Petersburg has a very attractive median home list price of $282,200, as well as a competitive median rent of $1,276 per month. Groceries will cost you $4,011.46 per year, which is a bit high, but utilities cost $3,873.70 annually, which is in line with many other cities on GOBankingRates’ list.
• Annual retirement costs for homeowners:$36,370.24
• Annual retirement costs for renters:$34,858.24
Charleston’s median home list price is $379,900, which isn’t too steep. The annual grocery cost of $3,589.61 and transportation cost of $4,992.90 are also on the lower end, which makes Charleston a great city to live in if you’re watching your retirement spending.
• Annual retirement costs for homeowners:$37,004.42
• Annual retirement costs for renters:$31,244.42
Although this was supplemental research that didn’t factor into the overall rankings, it’s important to mention that Overland Park is one of just four cities on GOBankingRates’ list that tax Social Security benefits. The other three cities are Rochester, Minnesota; Arvada, Colorado; and Centennial, Colorado.
That said, Overland Park is a good choice if you’re looking for a city with low retirement expenses. If you choose to buy, you’ll find a median home list price of $395,000, and if you choose to rent, you’ll pay $1,027 per month, on average.
Related:Best Places in Every State To Live On a Fixed Income
• Annual retirement costs for homeowners:$29,349.13
• Annual retirement costs for renters:$30,957.13
If you can deal with inclement weather, Sterling is one of the best retirement cities in the U.S. thanks to an extremely low median home list price of $205,999 and a median monthly rent of $920. Food and utilities are also a bargain, but transportation costs are rather high at $7,076.30 per year.
• Annual retirement costs for homeowners:$33,008.16
• Annual retirement costs for renters:$31,916.16
Mesa is one of the best places to retire in Arizona. Housing is inexpensive: You can rent for a median price of $977 per month or buy for a median list price of $279,900. In addition, you’ll pay only $3,730.23 per year for groceries and $3,717.71 per year for utilities. Healthcare costs, however, are on the high end at $6,807.20 annually.
• Annual retirement costs for homeowners:$42,058.68
• Annual retirement costs for renters:$38,710.68
Roseville has a very inexpensive annual transportation cost of $4,929.35 and decently priced healthcare at $5,909.40 per year. But, if you want to buy a house, you should expect to pay the median home list price of $505,490. If you choose to rent a place, you’ll fork over the median rent of $1,649 per month.
• Annual retirement costs for homeowners:$60,336.82
• Annual retirement costs for renters:$51,540.82
Glendale’s median home list price of $842,450 and median rent of $2,481 per month aren’t considered low, but annual food and utility costs are reasonable at $3,912.62 and $3,691.72, respectively. That said, transportation costs are the second highest among all the cities on GOBankingRates’ list at a whopping $8,447.08 per year, coming in just behind West Covina, California.
• Annual retirement costs for homeowners:$59,387.86
• Annual retirement costs for renters:$44,831.86
Torrance has high transportation costs at $8,024.95 per year, as well as an expensive median home list price of $837,000. However, annual grocery and utility costs are pretty cheap at $3,921.62 and $3,416.88, respectively, and healthcare is surprisingly inexpensive at $5,708.40 per year.
See:Best Places To Retire If You Can’t Save Up $1,000,000
• Annual retirement costs for homeowners:$59,882.06
• Annual retirement costs for renters:$47,102.06
Retire in Carlsbad, and your healthcare bill will total only $5,721.80 per year, on average. If you buy, you can expect to fork over the median home list price of $875,000, and if you rent, it’ll cost you around $2,273 per month. At $4,050.52 annually, you’ll spend a bit more on groceries compared to what you’d pay in many other cities, but your utilities will cost $3,617.44, which isn’t considered the high end of the spectrum.
• Annual retirement costs for homeowners:$59,978.53
• Annual retirement costs for renters:$44,966.53
Beach living can be expensive, and Huntington Beach is no exception. The city’s median home list price is $889,900, and its median rent is $2,144 per month. Food, utility and transportation costs, however, are all reasonable. Even healthcare, which will run you $5,963 annually, isn’t as expensive compared to many of the other cities on GOBankingRates’ list.
• Annual retirement costs for homeowners:$35,994.69
• Annual retirement costs for renters:$39,990.69
As one of the best places to retire in Florida, Hollywood has more going for it than the city’s relatively low median home list price of $320,000. If you decide to rent in Hollywood, you can find a place for a median price of $1,554 per month, and your utilities will also be on the low end at $3,591.44 annually.
• Annual retirement costs for homeowners:$32,099.26
• Annual retirement costs for renters:$30,131.26
At just $919 per month, Metairie has the lowest median rent price of all the cities in this study. It also has a relatively low median home list price of $284,000. In addition, annual grocery and utility costs are pretty inexpensive at $3,628.67 and $3,205.18, respectively.
• Annual retirement costs for homeowners:$27,517.15
• Annual retirement costs for renters:$31,021.15
Palm Bay has one of the cheapest transportation costs at just $4,697.87 per year, which might make it attractive to retirees. At $195,000, it also has the second-lowest median home list price out of all the U.S. cities on GOBankingRates’ list. Grocery, utility, transportation and healthcare costs are quite reasonable, too.
• Annual retirement costs for homeowners:$35,932.55
• Annual retirement costs for renters:$34,276.55
Peoria looks attractive as a retirement city based on the median rent price of $1,140 per month. Throw in the low median home list price of $334,900 and the relatively cheap annual cost for groceries, and Peoria can easily become one of the best cities to retire in the U.S.
Discover:The 50 Cheapest Places To Retire Across America
• Annual retirement costs for homeowners:$55,898.81
• Annual retirement costs for renters:$44,894.81
Thousand Oaks might sound like the perfect place to retire if your heart is set on living out your golden years in expensive California. Healthcare is on the cheap end at $6,244.40 per year, and the annual costs for groceries and utilities are reasonable at $3,831.79 and $3,613.72, respectively.
• Annual retirement costs for homeowners:$35,362.11
• Annual retirement costs for renters:$35,566.11
Richardson is one of the best places to retire in Texas. If you rent, you’ll face a median price of $1,314 per month, and if you buy, you can expect to pay the median home list price of $339,900. Costs for groceries, healthcare and transportation are all middle of the road compared to the other cities on GOBankingRates’ list.
• Annual retirement costs for homeowners:$37,023.73
• Annual retirement costs for renters:$35,031.73
Rents in Henderson are reasonable at a median price of $1,245 per month, and shopping around for a home yields a median price of $369,999. Moderate annual healthcare costs of $6,331.50 as well as reasonable expenditures for groceries and utilities — at $3,792.73 and $3,740 per year, respectively — serve to boost Henderson into this ranking of the best places to retire in the U.S.
• Annual retirement costs for homeowners:$54,183.43
• Annual retirement costs for renters:$46,047.43
At $6,547.78 per year, Honolulu has the most expensive utilities on GOBankingRates’ list by a wide margin. But healthcare costs are reasonable at $6,217.60 per year, and contrary to what you might expect, Honolulu isn’t in the top 10 for most expensive annual mortgage costs.
• Annual retirement costs for homeowners:$31,690.86
• Annual retirement costs for renters:$33,886.86
If you want to retire in a city where the median home list price is only $265,000 and the median rent is $1,194 per month, Clearwater is a good choice. This Florida city also has reasonable food and utility expenses, as well as a relatively low cost for transportation at $5,051.91 annually.
• Annual retirement costs for homeowners:$34,902.53
• Annual retirement costs for renters:$41,838.53
There’s a reason why you’re seeing so many Florida cities on this list — it’s a great state for retirees. Pembroke is affordable whether you rent or buy, and utilities run on the low end at $3,628.58 per year. Annual healthcare costs are also reasonable at $6,432, but transportation costs are on the high end at $7,330.49 per year.
• Annual retirement costs for homeowners:$36,464.51
• Annual retirement costs for renters:$38,804.51
This Florida city has rather high annual transportation costs at $7,548.36, but healthcare is still somewhat reasonable at $6,646.40 per year. And, you can buy a home for a median list price of $294,900 or rent somewhere for a median price of $1,703 per month.
• Annual retirement costs for homeowners:$27,503.26
• Annual retirement costs for renters:$30,599.26
If you want to retire and buy a home, you can purchase one in Lakeland for a median price of $199,900 — the third cheapest on GOBankingRates’ list. Or, you can rent a place for a median price of $1,021 per month. You’ll also encounter low annual transportation costs at $4,384.67 and reasonable healthcare costs at $6,311.40 per year.
• Annual retirement costs for homeowners:$28,039.29
• Annual retirement costs for renters:$32,719.29
Spring Hill has a median home list price of just $180,000, and it also boasts the lowest mortgage payments at $8,244 per year. Additionally, the median rent is only $1,077 per month. All other costs are middle of the road for this list, making Spring Hill a very attractive place to spend your golden years.
• Annual retirement costs for homeowners:$47,723.93
• Annual retirement costs for renters:$37,235.93
If Arizona appeals to you, check out Scottsdale. Although the median home list price is rather high at $605,000, you can rent for $1,434 per month. Annual food and utility costs are relatively low at $3,730.23 and $3,803.14, respectively, which makes Scottsdale a very livable city for retirees.
• Annual retirement costs for homeowners:$31,036.17
• Annual retirement costs for renters:$36,668.17
Food is a bit expensive in Port Saint Lucie, costing $4,011.46 per year, but annual utility costs are fairly low at $3,487.45. The median list price for a home in this city — $247,340 — is reasonable, and you can rent somewhere for a median price of $1,580 per month. Overall, this city on the Atlantic coast of southern Florida is a good choice for retirees.
• Annual retirement costs for homeowners:$32,178.67
• Annual retirement costs for renters:$34,470.67
You might be surprised that the city of Surprise ranks No. 2 on GOBankingRates’ list because its median home list price of $269,500 isn’t the lowest. But, you can rent for a median price of $1,219 per month, and you can feed yourself for a low cost of $3,730.23 per year.
• Annual retirement costs for homeowners:$33,541.98
• Annual retirement costs for renters:$35,761.98
Healthcare costs in Cape Coral are by far the most expensive on GOBankingRates’ list at $8,013.20 per year. But, if you move to this southwest Florida city, you’ll be able to buy a house for a low median list price of $262,200. And, you can rent for a cheap median price of $1,185 per month.
See Why:The Best Places To Retire In America Are All College Towns
Choosing the best place for you to retire doesn’t always mean finding the cheapest place. When you’re looking for your ideal retirement city, it’s essential to take various factors into account, including how much it’ll cost for you to eat, get around, use basic utilities and gain access to healthcare.
Because GOBankingRates has done the legwork for you, all you have to do now is decide which city fits you — and your financial situation — the best. Overall, Florida takes the crown with seven of the top 10 cities for retirement. For options beyond the Sunshine State, Arizona clinched two of the top retirement cities, and Hawaii managed to snag the No. 10 spot.
Click through tofind the best cities to retire on $1,500 per month.
More on Retirement Planning
• Our Road to Retirement: Driving the US To Find the Best Places To Retire
• Want To Retire Rich? Avoid These 10 States, Study Says
• 16 Unusual Money Moves That Could Set You Up for Life
Methodology: GOBankingRates analyzed the top 100 cities with a population over 100,000 based on the percentage of the population ages 65 and older, as sourced from the U.S. Census Bureau’s 2017 American Community Survey’s five-year estimates. GOBankingRates then took these top 100 cities and ranked them across five factors: (1) violent crime rate per 1,000 residents, sourced from NeighborhoodScout; (2) property crime rate per 1,000 residents, sourced from NeighborhoodScout; (3) livability score, sourced from AreaVibes; and (4) average annual temperature, sourced from Weatherbase.com. These factors were scored and combined, with a lower score indicating a better score. The top 50 cities were then chosen to determine their total cost-of-living necessities.
To determine the total cost-of-living necessities, GOBankingRates found the annual costs of a (1) 30-year fixed-rate mortgage at a 3.99% APR, as determined by the St. Louis Federal Reserve Bank on May 30, 2019, based off median home list prices as sourced from Zillow, and (2) annual rent costs, sourced from RentCafe.com. GOBankingRates then determined the (3) annual cost of food/groceries based on “food at home” annual expenditures for people ages 65 and older, sourced from the 2017 Bureau of Labor Statistics Consumer Expenditure Survey (this cost was then adjusted to each city’s local cost of living using Sperling’s Best Places’ grocery index); (4) annual cost of utilities, based on “utilities, fuels, and public services” annual expenditures for people ages 65 and older, sourced from the 2017 Bureau of Labor Statistics Consumer Expenditure Survey (this cost was then adjusted to each city’s local cost of living using Sperling’s Best Places’ utilities index); (5) annual cost of healthcare, based on “healthcare” annual expenditures for people ages 65 and older, sourced from the 2017 Bureau of Labor Statistics Consumer Expenditure Survey (this cost was then adjusted to each city’s local cost of living using Sperling’s Best Places’ healthcare index); and (6) annual cost of transportation, based on “transportation” minus “vehicle purchases” (we assumed that new retirees will not be purchasing a new car) annual expenditures for people ages 65 and older, sourced from the 2017 Bureau of Labor Statistics Consumer Expenditure Survey (this cost was then adjusted to each city’s local cost of living using Sperling’s Best Places’ transportation index). These factors were then combined to give both an (7) annual necessities cost for homeowners and (8) annual necessities cost for renters in all 50 best cities to retire.
GOBankingRates also found supplemental tax data for each city, which included (1) local sales tax rate as sourced from each city/county’s website; (2) state sales tax rate, sourced from the Tax Foundation’s “State and Local Sales Tax Rates, 2019”; (3) whether the states taxed Social Security benefits as sourced from the AARP; and (4) whether the states taxed retirement income such as 401(k) plans, pensions, etc. as sourced from each state’s tax/revenues website.
This article originally appeared onGOBankingRates.com:The 50 Best Places To Retire — and What It Costs To Live There |
Facebook Is Building An Oversight Board. Can That Fix Its Problems?
(Bloomberg) -- On a recent Wednesday afternoon in late May, roughly 30 Facebook Inc. employees gathered at the company’s Menlo Park, California, headquarters to talk about sexual harassment.
The group was there to consider a single, controversial Facebook post: an unsubstantiated list of more than 70 academics accused of predatory behavior, which also encouraged people to submit more “sexual harassers” to the list. The Facebook employees were asked to decide: Should the post remain up?
The reality is the group had no authority to determine the post’s fate – that had been decided years ago by Facebook’s content moderators, who decided to leave it up. The employees were instead gathered for a role-playing exercise, the latest in a series of simulations Facebook is running globally on its way to creating a new Content Oversight Board that will review controversial decisions made by the company’s content moderators. If someone believes their post was removed in error, or the general public takes issue with a post that was allowed to remain, the board may step in and provide a final ruling. The list of creepy academics is the kind of post the board may one day review.
For more than two hours, the group grappled with the list, taking notes on floor-to-ceiling whiteboards. Were the allegations credible? How many people saw the post? How many people reported it? What did Facebook’s content policies stipulate?
One employee posed a question to the group right before they adjourned. “These are evolving situations, right?” said the employee, who Bloomberg agreed to keep anonymous as part of observing the session. “[Pretend] one week later, two weeks later, someone on that list commits suicide. A week later another person commits suicide. Do we take it down? Do we say, no, we decided to keep it up?’” In the end, the group voted overwhelmingly that the list should remain up – 22 votes in favor, 4 against – though few employees seemed fully convicted in their decision.
In a world where Facebook is deemed much too powerful, and where the company is constantly criticized by some for taking down too much, and by others for taking down too little, the new Oversight Board represents a potential solution to one of Facebook’s thorniest problems: Its control over global speech. This new board, which doesn’t yet exist, will make content decisions for a global network of 2.4 billion people, making it a de-facto Free Speech Supreme Court for one of the biggest communities on the internet.
It undoubtedly comes with challenges. The board’s independence will most certainly be an issue, and it’s unlikely the board will move at the speed necessary to keep up with the internet’s viral tendencies. But Facebook is on an elaborate listening tour in hopes of turning this Supreme Court vision into a reality that people can trust.
The idea for Facebook’s Supreme Court originated with Noah Feldman, an author and Harvard law professor who pitched the concept of a “Supreme Court of Facebook” to Chief Operating Officer Sheryl Sandberg in January 2018. (Feldman is also a columnist for Bloomberg Opinion.) Feldman’s pitch outlined the need for an independent, transparent committee to help regulate the company’s content decisions. It was passed along to Zuckerberg, and Facebook ultimately hired Feldman to write a white paper about the idea and stay on as an adviser. The first time the idea was floated publicly was on a podcast that Zuckerberg did with Vox’s Ezra Klein, where he mentioned the idea for an independent appeals process “almost like a Supreme Court.”
It's been more than a year since that podcast, and more than seven months since Zuckerberg formally announced plans to build an Oversight Board, and the company is still trying to agree on its fundamental structure. Basic decisions like how many members it should have, how those members should be picked, and how many posts the board will review, are all still undecided.
Facebook’s tentative plan is outlined in a draft charter. The company will create a global 40-person board made up of people appointed by Facebook. It’s unclear how many content cases the board will review, though Facebook envisions each case will be reviewed by 3 to 5 members. Once a decision is made, it’s final, and the ruling board members will then write a public explanation, and could even suggest that Facebook tweak its policies.
About the only thing that has been decided is that the board should be independent. Critics have slammed Facebook for having too much control over what people are allowed to share online. For years, conservative politicians and media personalities have accused the company of bias against conservative ideas and opinions. Facebook co-founder Chris Hughes criticized Zuckerberg’s power in a recent New York Times op-ed, saying that it was “unprecedented and un-American.”
The board is intended to take some of that power. Zuckerberg has promised these decision makers will be free of influence by Facebook and its leaders – though getting to true independence will be the company’s first big challenge. “It’s all well and good for people on the outside to kind of prescribe that, yeah, Facebook needs to cede some of its power to outsiders,” said Nate Persily, a Stanford law professor and expert in election law. “But when you start unpacking how to do that, it becomes extremely complicated very fast.”
Persily has already seen a version of the board come together. At Stanford, he just completed a two-month course with a dozen law school students who created their own version of the Facebook Oversight Board. The class presented their findings to Facebook employees at the end of May, suggesting that the board be much larger than the 40 part-time members Facebook outlined in its draft charter.
“If they’re going to do any reasonable slice of the cases that are going to go through the appeals process, it’s going to have to be much larger or it’s going to have to be full-time,” Persily said.
These kind of suggestions are why Facebook says it’s been running these simulations with academics, researchers and employees all over the world. Each serves as an elaborate survey. Since the start of the year, Facebook has hosted board simulations in Nairobi, Mexico City, Delhi, New York City, and Singapore.It also opened the process to public feedback. During a recent open comment period, Facebook received more than 1,200 proposals from outside individuals and organizations with recommendations on what the company should build. Responses came from established groups like the media advocacy organization Free Press, and also concerned individuals from Argentina, France and Israel. Others like the Electronic Frontier Foundation and the Bonavero Institute of Human Rights at Oxford, provided Facebook with input through their own papers and blog posts.
The Bonavero Institute summarized its suggestions in a 13-page report, which included everything from different ways Facebook could pick cases for the board to review, to recommendations on how the board should be compensated. Both the EFF and the Bonavero Institute hammered home the importance of keeping the board independent.
“But our biggest concern is that social media councils will end up either legitimating a profoundly broken system (while doing too little to fix it) or becoming a kind of global speech police, setting standards for what is and is not allowed online whether or not that content is legal,” Corynne McSherry, EFF’s legal director, wrote on its blog. “We are hard-pressed to decide which is worse.”
Facebook is expected to publicly release a new report with findings from its simulations later this week.
Achieving real independence will be tricky given Facebook plans to appoint the initial board members, who will serve three-year terms. It will also pay them, though through a trust. Then the plan is for the board to self-select its replacement members as terms expire. The idea is that, while Facebook may appoint the initial group, future generations of the board will be free of Facebook’s influence.
“It isn’t just the people who we’re picking, but the process in which we’re picking them,” said McKenzie Thomas, a Facebook program manager helping lead the Oversight Board project. She emphasized the importance of having the board self-select its own replacement members as a key element of its independence. “This is a starting off point,” she added.
Then there’s the speed problem. It’s unrealistic to expect that the board’s decisions will happen with the speed necessary to police the internet. That means the board will likely serve more as a post-mortem – a way to review decisions that have already been made, and if needed, issue a ruling that could impact how future posts are handled by moderators.
It won’t, however, be a very efficient way to police Facebook in the moment, which is when content can usually cause the most damage. Facebook’s virality can mean that troubling content reaches millions of people in a matter of hours, if not minutes. The board won’t be necessary to make decisions on extreme violence, like the shooter who livestreamed his killing spree in New Zealand. Facebook already has strict policies in place for that kind of material. But borderline content, like deciding whether a post includes hate speech or just a strong opinion, could remain up for weeks until the board gets to it.
“One of the things we need to figure out is…what is a version of a more urgent [board] session?” said Brent Harris, director of governance and global affairs at Facebook. “Does that make sense, and what does that look like?”
Kate Klonick, a professor at St. John’s Law School, has written extensively about free speech, including an op-ed about Facebook’s oversight board in the New York Times. She’s observing the board’s creation for a law journal article she’s writing, and already spent one week embedded with the company.
The board, she says, may not move quick enough to solve all of Facebook’s content problems, but at least it should provide an outside voice so that Facebook alone isn’t responsible for free speech rules online. “I see this [oversight board] as a solution for maybe that problem,” she added, “and unfortunately, not for the problem of the outrage machine.”
In a best case scenario, Klonick thinks Facebook’s oversight board could inspire similar organizations at other private companies. But she’s also prepared for an alternative outcome.
“Part of me is terrified [and] totally not delusional to the fact that...there’s just a really big chance that this just flops,” she said.
To contact the author of this story: Kurt Wagner in San Francisco at kwagner71@bloomberg.net
To contact the editor responsible for this story: Emily Biuso at ebiuso@bloomberg.net, Jillian Ward
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
This Ethereum Lottery Perfectly Explains How Facebook’s Big Corporate Backers Will Profit from Crypto
To understand how early investors in Facebook’s new Libra blockchain will make money over time, it helps to dig into a new lottery going live on ethereum mainnet Monday.
It’s a lossless lottery calledPoolTogetherand tickets are now on sale. Its similarity to Libra is not a completely one-to-one relationship, but the key insight of both is the same: Earning interest on your own money is good, but it’s better toalsoearn interest on other people’s money.
So first let’s explain this new ethereum game before circling backto Libra.
Related:BIS Wants ‘Level Playing Field’ for Banks Amid Threat From Firms Like Facebook
On PoolTogether, each ticket sells for 20 DAI (the stablecoin generated bythe MakerDAO protocol, which aims to keep a stable price at $1.00 each). Each pool sells as many tickets as it can, and all the DAI gets put into the ethereum-based money market protocol,Compound. There, all the ticket money collects interest over the life at the pool and at the end, one ticket earns all the interest off everyone’s ticket price.
But everyone else gets the money they paid for their tickets back, too –ergo, no losers.
“What excites me is that I think it can actually move the needle on economic health for a lot of people,” PoolTogether’s creator, Leighton Cusack, told CoinDesk.
People get excited about lotteries. They don’t excited about savings accounts. This is a way of nudging them in the right direction.
Related:A Monumental Fight Over Facebook’s Cryptocurrency Is Coming
The idea of putting the concept on ethereum was first discussed ina popular poston the MakerDAO subreddit in late March, and the project has been made possible thanks in part to a $25,000 grant from MakerDAO, the company.
“We think it’s good for the ecosystem,” MakerDAO’s Richard Brown, who runs community development for the decentralized finance firm, said of the project. “One of the things that interested me the most about this is it has the capacity to take a behavior that was essentially a tax on the poor and it allows it to become a tool for social good.”
In other words, lots of low-income people gamble despite dismal chances of ever benefiting. Personal finance site Bankrate has found that people areless likelyto buy lottery tickets as household income increases. PoolTogether takes the attractiveness of gaming and combines it with the healthy behavior of delayed gratification.
The strategy isn’t without precedent. Walmart has actually been runninga gaming mechanicto encourage people to save money on their cash cards. People have locked up over $2 billion since 2017.
With no risk of losing money, people start saving money rather than spending everything they have. With the returns on a typical savings account currently at0.9 percent, it’s not even irrational for a new saver to participate in a program like this. The opportunity cost is quite low.
At first, there will only be one pool on the site. It will be open for tickets for three days and then the winner will be announced after earning 15 days worth of interest, on July 11. PoolTogether will shave off 10 percent of the interest earned for its business model and the rest goes to the winner. It’s all defined in a smart contract recently audited byQuantstamp.
MakerDAO’s Brown believes the model could become a frictionless way for large groups of people with disposable funds to support good causes.
For example, someone could create a decentralized autonomous organization where all the interest on a pool goes to a wallet controlled by a non-profit of the winner’s choice (rather than into their personal account). He called it a new kind of “primitive” for decentralized finance, saying:
“It’s pretty low-friction. It’s pretty low-risk. It’s low-stress, because no one is coming out of this thing broke.”
PoolTogether’s Cusack foresees the project starting off just big enough. He wants the first winner to basically double their money off the winning 20 DAI ticket. That’s going to take getting a pool together of 100,000 DAI, Cusack said, which is a big goal but they already have several commitments to prime the pump with 1,000 DAI each.
Libra is also designed so that a select few capture the interest earned on money tucked away by the vast many.
As CoinDesk previously reported, there aretwo tokens that make Libra work. Most of the attention has been on the Libra coin, the stablecoin backed by some as-yet-unnamed basket of bonds and currencies. To get that basket started, though, Facebook came up with the idea for the “Libra investment token” (LIT).
Like PoolTogether, the whole point of LIT is to earn interest off other people’s deposits.
To make sense of why this is so powerful, think of a very simple example. Imagine one LIT sold for $10 million. Invested in a basket of boring, safe investments,Canaccord Genuity has projectedthe reserve should earn about 0.25 percent. So $25,000 in a year on $10 million. That’s not nothing, but it’s a lousy return for a tech investor.
But imagine 100,000 people decided they wanted to use Libra coin, and all of them bought $100 worth each. Now that holder of the one LIT will earn $50,000 in a year, because the reserve was doubled with other people’s money, but only the LIT earns the interest.
Now, this is a global project, so obviously Libra’s backers want to get in a lot more than 100,000 people. Even if a billion dollars in LIT tokens are sold, with companies like Visa, Uber and PayPal involved, there’s no way they aren’t targeting many, many billions in the reserve. With each additional billion, the returns multiply to LIT holders.
Canaccord Genuity estimates that if Libra coin gets a market cap equal to bitcoin’s, $162 billion, then $324 million could be paid back to all LIT holders each year, after subtracting operational expenses for the Libra Association.
Let’s assume no organization holds more than one LIT and the Libra Association hits its 100 founding partners as planned: that’s a $3.24 million annual return on each partner’s $10 million investment. It’s not a one-time return either. They keep getting it as long as the Libra coin keeps running.
So 10 years after it matches bitcoin’s market cap, a LIT holder would have earned $32.4 million without losing any of their principal, a better than 300 percent gain. And that’s assuming the reserve didn’t grow at all as the decade passed.
On PoolTogether, everybody is betting that they can win the interest off of everyone else’s tickets. A crypto newbie could buy one ticket for 20 DAI and get all the interest earned off a whale who bought 1,000 tickets.
On the Libra protocol, it works the same way, except the same whales always win.
It remains to be seen if Libra will get to that point or if it will even get off the ground, but PoolTogether is starting now for anyone who wants a shot at robbing a whale. The person who created the product that will host the first pools, Compound’s Robert Leshner, told CoinDesk that he’ll definitely be buying some tickets in the first round.
Said Leshner:
“We love watching the world experiment with new products and new ideas built on top of Compound no matter what they do. I’m excited.”
Lottery ticketimage via Shutterstock
• Facebook’s Crypto Hiring Spree Continues With Search for Finance Lead
• G7 Forming Task Force in Response to Facebook’s Libra Cryptocurrency |
Is Medicover AB (publ)'s (STO:MCOV B) High P/E Ratio A Problem For Investors?
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This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Medicover AB (publ)'s (STO:MCOV B), to help you decide if the stock is worth further research. Looking at earnings over the last twelve months,Medicover has a P/E ratio of 47.93. That is equivalent to an earnings yield of about 2.1%.
View our latest analysis for Medicover
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share (in the reporting currency) ÷ Earnings per Share (EPS)
Or for Medicover:
P/E of 47.93 = €8.19(Note: this is the share price in the reporting currency, namely, EUR )÷ €0.17 (Based on the year to March 2019.)
A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That 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 even if the current P/E is low, it will increase over time if the share price stays flat. Then, a higher P/E might scare off shareholders, pushing the share price down.
Medicover saw earnings per share decrease by 4.1% last year. And it has shrunk its earnings per share by 5.6% per year over the last five years. So it would be surprising to see a high P/E.
We can get an indication of market expectations by looking at the P/E ratio. As you can see below, Medicover has a much higher P/E than the average company (15.5) in the healthcare industry.
Medicover's P/E tells us that market participants think the company will perform better than its industry peers, going forward. The market is optimistic about the future, but that doesn't guarantee future growth. So investors should delve deeper. I like to checkif company insiders have been buying or selling.
The 'Price' in P/E reflects the market capitalization of the company. So it won't reflect the advantage of cash, or disadvantage of debt. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash).
Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof).
Medicover's net debt is 9.0% of its market cap. So it doesn't have as many options as it would with net cash, but its debt would not have much of an impact on its P/E ratio.
Medicover trades on a P/E ratio of 47.9, which is above the SE market average of 16.9. With some debt but no EPS growth last year, the market has high expectations of future profits.
Investors have an opportunity when market expectations about a stock are wrong. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' So thisfreevisualization of the analyst consensus on future earningscould help you make theright decisionabout whether to buy, sell, or hold.
But note:Medicover may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20).
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Top 10 Cheapest Airports in the US
When you’re watching your vacation dollars, start by finding ways to save money on airfare. Some of the best airports are cheaper to fly into and offer more reasonable rates on parking, food, WiFi and other amenities.
RewardExpert studied the 45 busiest airports across the nation and compared various expenses — plane tickets, amenities, food, etc. — to identify the 10 least expensive airports in the U.S.
Click through tosee some of the best airports for cheap attractions, food, airfare and more.
Location:New OrleansAverage domestic fare:$316.70
Not only does New Orleans boast one of the cheapest airports in the U.S., but it’s also one of thedestinations that will be cheaper to visit this year.
Fifteen airlines do business at Louis Armstrong New Orleans International Airport, transporting more than 11.1 million passengers to and from domestic and international destinations each year.
The busy U.S. airport is scheduled to open a new North Terminal in February 2019 that will include 35 airline gates with concessions, music and scents designed to emanate the spirit of New Orleans without ever leaving the terminal.
The airport is named for music legend Louis Armstrong for good reason. Tap your toes or just get up and dance to some of New Orleans’ signature music while you wait for boarding or baggage.
Groove to live entertainment on The Big Stage of Concourse C Lobby. Three more post-security venues in concourses B, C, and D require passing the TSA checkpoint to see a show.
How Gullible Are You?Here Are the Biggest Airport Myths You Shouldn’t Believe
Location:Portland, Ore.Average domestic fare:*$324.05
Portland International Airport consistently takes top honors on Travel+Leisure’s 10 best domestic airport lists, gaining the No. 1 spot from 2013 through 2017.
Serving 17 passenger airlines, the airport has light rail traveling to the city center, where travelers can connect to 97 stations around the city. A 17-seat movie theater, extensive art exhibits and live performers offer lots to do while waiting for your flight.
Forget about making an extra stop or two on the way to the airport to avoid expensive concourse restaurant prices. Experience a taste of the city without ever leaving the airport.
Culinary offerings and the price you’ll pay both reflect the city’s dining scene in the local area. Discover hometown favorites such as Laurelwood Brewing Co., bite into the city’s food cart scene or sip a local microbrew.
Location:Oakland, Calif.Average domestic fare:$303
Nearly 11 million passengers each year pass through Oakland International Airport, the fourth-largest airport in the state, en route to 55 domestic and international destinations.
Multiple transportation options make travel between the San Francisco Bay area and the airport easy. BART departs near the baggage claim area in Terminal 1, and ride-share companies such as Uber, Lyft and Wingz all have airport access.
If you want tofeel like a VIP when you travel, head to the Escape Lounge at OAK to enter a more tranquil environment where you can relax, charge your electronics or nosh on light fare. You don’t need to be a member — just book your spot online or pay at the door.
Location:DenverAverage domestic fare:$312
More than 58 million passengers travel through Denver International Airport each year, making it the sixth-busiest in the U.S.
A layover in the airport offers time to browse unusual architecture and artwork. The airport’s permanent collection ranges from bronze gargoyles sitting in suitcases above baggage claim in the Jeppesen Terminal to the towering red-eyed mustang on Peña Boulevard outside. The airport’s interactive web guide points you to works closest to you.
Your furry companion will love a trip to DEN when youfly aboard affordable pet-friendly airlinesserving the airport. Private pet-relief rooms let your dogs stretch their legs, or do their business, in a convenient indoor area centrally located in the central hub of A, B, and C gates.
For some pet pampering, head to Paradise 4 Paws resort, a boarding facility where your pet can recline in a private suite, splash in a pool and even get a massage while you enjoy your Denver adventure.
Location:San Jose, Calif.Average domestic fare:$322.70
Although it serves the wealthy Silicon Valley, Mineta San Jose International Airport has some of the least-expensive average domestic airfare in the country, according to RewardExpert. The company also cited lower-than-average rates for transportation and parking in its rankings.
Those expecting to find the best tech features an airport has to offer won’t be disappointed. The airport-wide WiFi comes with a free security app that encrypts the open connection. A one-of-a-kind IPal Playground has social companion robots that educate, entertain and engage in interactive play. Concierge robots roam between gates 11 and 25 to assist travelers in multiple languages.
There also are handy automated concessions that will clean your jewelry or eyeglasses in less than two minutes as well as automated massage chairs.
Fly in Style:Your Cost to Upgrade on These 10 Popular Airlines
Location:Tampa, Fla.Average domestic fare:$312.20
Twenty domestic and international airlines serve TPA, with nearly 19 million passengers traveling through the airport annually. While that’s an impressive number, it serves about half as many passengers per year as Miami International Airport (44.6 million) and Orlando International Airport (41.9 million), according to the Federal Aviation Administration.
Still, the airport ranked the highest in the 2017 J.D. Power Airport Satisfaction Rankings for large airports.
Thousands of military personnel traveling through the airport and the city of Tampa find a home away from home at the USO Central Florida Welcome Center.
Troops have access to computers, phones, printers, WiFi, CAC readers and popular gaming systems. The area also includes a sleeping and quiet area, library, travel services and access to toiletries to spiff up to meet loved ones.
Location:PhoenixAverage domestic fare:*$327.14
When the city of Phoenix took over ownership of Sky Harbor Airport in 1935, it was nicknamed “The Farm” because of its rural location. Today, the city has grown up around it, leaving Sky Harbor centrally located in the fifth-largest metro area in the U.S.
A mega airport serving more than 43 million passengers a year, it’s one of the top four airports for customer satisfaction in the country, according to the 2017 North America Airport Satisfaction Study.
Each of PHX’s three terminals houses a portion of the Phoenix Airport Museum, where you can view 900 works of art in media ranging from acrylic and oil paintings to metal and ceramic sculptures.
The museum displays are convenient to the SkyTrain platforms in Terminals 3 and 4 and at the East Economy Parking Garages. Get in touch with Phoenix history and culture at the displays, which feature some of the state’s most renowned artists.
More Museum Fun:Your Cost to See These Weird Museum Attractions
Location:: Orlando, Fla.Average domestic fare:: $253.90
Orlando International Airport is No. 2 in terms of passenger numbers in Florida, with about 41.9 million passengers taking off and landing annually.
Despite its heavy passenger load, Orlando took top honors in the J.D. Power 2017 study of passenger satisfaction for mega airports handling at least 32 million passengers per year.
MCO gets top marks for its facilities and ease of getting around in the J.D. Power study. The airport has an app for both iPhone and Android smartphones that gives passengers the lowdown on current TSA wait times, the closest shopping and dining options and location-based directions to your gate or other destination.
A Hyatt Regency hotel inside the airport’s main terminal eliminates time in traffic and offers a convenient resting place for weary travelers. And restaurant options at the airport range from fast food to fine dining.
Location:Las VegasAverage domestic fare:$227.50
If you can’t wait togamble when you get to Vegas, you won’t have to: McCarran International Airport has 1,300 slot machines throughout for travelers 21 and older.
More than 47.4 million passengers pass through McCarran International Airport annually, served by 31 major airlines. Although it’s the eighth-busiest airport in the nation, the airport ranked third in the nation for mega-airports in the 2017 J.D. Power Airport Satisfaction Ratings.
The odds are definitely in your favor when it comes to leaving with the correct luggage. McCarran International Airport is one of just a dozen airports in the world that tracks checked baggage using radio frequency microchips.
When you check your baggage, your bag will get one of McCarran’s paper luggage tags that contain small copper chips instead of barcodes that can be misread by scanners if wrinkled. It’s improved accuracy from as little as 80 percent to more than 99 percent.
Did You Know?Here Are 6 Clever Ways to Save on Airline Baggage Fees
Location:Fort Lauderdale, Fla.Average domestic fare:$241.80
Roughly 80,000 passengers pass through Fort Lauderdale-Hollywood International Airport’s four terminals each day. The airport is one of a few that still offers luggage storage, giving you more freedom to explore during a layover or while waiting for a flight.
You also can get baggage wrapping service for just $15 per bag. The protective plastic wrapping prevents damage or loss to your luggage and comes with guarantees of up to $5,000 if your luggage is damaged or lost.
Kids love to watch planes take off and land, and FLL rolls out three prime spots to watch the action.
Check out the view from the west end of the north runway at the Ron Gardner Aircraft Viewing Area, or get a birds-eye view from the Hibiscus Garage Viewing Area. Walk along a 30-acre greenbelt with lush wetlands and vegetation and sit under a shady tree on the airport’s south side.
Up Next:The Top 10 Most Expensive U.S. Airports
All costs were sourced from RewardExpert’s “2017’s Most and Least Expensive U.S. Airports” report. *For airports that were missing the average domestic fare in the RewardExpert report, the latest 2016 average annual figures from the Bureau of Transportation Statistics were cited.
Photo Disclaimer: Please note photos are for illustrative purposes only.
This article originally appeared onGOBankingRates.com:Top 10 Cheapest Airports in the US |
Does Market Volatility Impact McPhy Energy S.A.'s (EPA:MCPHY) Share Price?
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If you're interested in McPhy Energy S.A. (EPA:MCPHY), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first category is company specific volatility. This can be dealt with by limiting your exposure to any particular stock. The second type is the broader market volatility, which you cannot diversify away, since it arises from macroeconomic factors which directly affects all the stocks on the market.
Some stocks see their prices move in concert with the market. Others tend towards stronger, gentler or unrelated price movements. Beta is a widely used metric to measure a stock's exposure to market risk (volatility). Before we go on, it's worth noting that Warren Buffett pointed out in his 2014 letter to shareholders that 'volatility is far from synonymous with risk.' Having said that, beta can still be rather useful. The first thing to understand about beta is that the beta of the overall market is one. Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
View our latest analysis for McPhy Energy
Given that it has a beta of 1.65, we can surmise that the McPhy Energy share price has been fairly sensitive to market volatility (over the last 5 years). If this beta value holds true in the future, McPhy Energy shares are likely to rise more than the market when the market is going up, but fall faster when the market is going down. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how McPhy Energy fares in that regard, below.
McPhy Energy is a rather small company. It has a market capitalisation of €72m, which means it is probably under the radar of most investors. It takes less money to influence the share price of a very small company. This may explain the excess volatility implied by this beta value.
Beta only tells us that the McPhy Energy share price is sensitive to broader market movements. This could indicate that it is a high growth company, or is heavily influenced by sentiment because it is speculative. Alternatively, it could have operating leverage in its business model. Ultimately, beta is an interesting metric, but there's plenty more to learn. In order to fully understand whether MCPHY is a good investment for you, we also need to consider important company-specific fundamentals such as McPhy Energy’s financial health and performance track record. I urge you to continue your research by taking a look at the following:
1. Future Outlook: What are well-informed industry analysts predicting for MCPHY’s future growth? Take a look at ourfree research report of analyst consensusfor MCPHY’s outlook.
2. Past Track Record: Has MCPHY been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of MCPHY's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how MCPHY measures up against other companies on valuation. You could start with thisfree list of prospective options.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
21 Stock Perks That Will Blow Your Mind
The main reason investors buy stocks is to make money. Returns on stocks generally come in two forms:dividends and capital gains. Whether you actually come out on top is dependent on a lot of factors, but for long-term wealth, investing is widely considered the way to go.
For a small group of stocks, though, there areadditional hidden benefitsoffered to shareholders. Although these perks won’t make the difference between a good and bad investment, they still might be worth pursuing if you own stock in these companies, or are considering it.
Click through for hidden stock perks so you can betterdecide how to invest your money.
Carnival Corporation & PLC, which offers cruises under brands that include Carnival Cruise Line, Holland America Line and Princess Cruises, sells shares with perks. People who own at least 100 shares can receive onboard credit. It’stime to start planning your next cruise.
The Miami company provides an onboard credit of $50 per stateroom for sailings of six days or less; $100 per stateroom for seven- to 13-day sailings and $250 per stateroom for sailings of at least 14 days. Carnival requires that customers make an application for the perks at least three weeks before your departure date.
Norwegian Cruise Line Holdings Ltd., with 25 ships, also offers shares withperks for its loyal but frugal ship enthusiasts. The Miami company provides people who own at least 100 shares with an onboard credit of $50 per stateroom for trips of six days or less; $100 per stateroom for trips of seven to 14 days and $250 per stateroom for 15-day plus long trips. Norwegian reserves the shareholder benefits for vacation on Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises.
To register for the perks, you’ll need to complete a form on Norwegian’s investor relations website and make your request at least 15 days prior to sailing. Norwegian requires you include your shareholder proxy card or a copy of your current brokerage statement.
Royal Caribbean Cruises Ltd., a Miami company with 49 ships, also has shareholderperks fit for cruise ship insiders. The company, whose brands include Royal Caribbean International and Celebrity Cruises, provides onboard credit like those provided by Carnival and Norwegian. Its onboard credit consists of $50 per stateroom for trips of five days or less; $100 per stateroom for six- to nine-day sailings; $200 per stateroom for 10- to 13-day trips and $250 per stateroom for sailings of at least 14 days.
Royal Caribbean requires that shareholders make their request for onboard credit three weeks before sail date. The onboard credit can be applied only to Royal Caribbean International, Celebrity Cruises and Azamara Club Cruises sailings.
Outside of cruise companies, investors can receive perks from owning shares of InterContinental Hotels Group, a Denham, U.K.-based hotel operator and investor with more than 766,000 rooms in 5,174 hotels in about 100 countries. InterContinental allows the discounts to be applied to room bookings but not to packages or other travel components.
Learn whathotel secrets only insiders know.
In 2017, Kimberly-Clark Corp., a Dallas company that manufactures personal care, consumer tissue and professional products, provided shareholders an opportunity to buy a gift box that contained its products and coupons at a discount. The gift box cost $24.49 and had a retail value of $45. Although the 2017 gift box program ended on December 31, 2017, Kimberly-Clark has a message on its website advising shareholders to check back in September 2018 for this year’s box.
If you like perks for wine, then buy shares of Willamette Valley Vineyards, a Turner, Ore.-based company. Perks include access to special events at the winery, discounted wine selections via the company’s wine club and use of the winery’s tasting and hospitality facilities for events on select dates.
Must-Read:Your Cost to Visit the Best Winery in Every State
Mad River Glen, of Fayston, Vt., offers consumers an opportunity to ski on its slopes. It also provides shareholders with perks that include discounts to ski tickets and services. A share to buy into the ski cooperative costs $2,000 and can be purchased with one payment or 40 monthly payments of $50 and a $150 nonrefundable deposit.
If you’re traveling through Ireland and Great Britain, you could save money if you are an Irish Continental Group shareholder. The perks provided by the Dublin, Ireland-based transportation and leisure company include discounts of 5, 10 and 20 percent on passenger and ferry car service. To qualify for the discounts, you must own at least 1,000 shares. Learnthe best time to book your travel plans.
Accor SA, a hotel and management company founded in 1967 with 4,300 hotels in 100 countries, offers its shareholders an opportunity to join a shareholder’s club. Members of the club are entitled to systematic upgrades and a 7 percent discount, among other benefits such as hotel tours. Those who own at least 50 bearer shares and one registered share are eligible for the shareholder benefit.
The French company, which operates 4,283 hotels with 616,000 rooms in North America, trades under the ticker symbol ACRFF.
Top Tips:50 Things Your Hotel Will Give You for Free
Owners of shares of Berkshire Hathaway Inc. have benefited from the Omaha, Neb.-based conglomerate’s explosive growth. The company’s class-A share is trading at $299,000, up from $430 in 1980.
The annual shareholders meeting is more like a weekend-long conference, with a shareholder shopping day featuring extensive discounts and the opportunity to attend Warren Buffett’s signature address, where he expounds on the company’s performance andany mistakes he has made. Events also include a picnic, steak night, reception and 5K run. Shareholders are entitled to four meeting credentials.
EnthusiasticHarry Potter fans who are also frugalshould consider buying shares of Bloomsbury Publishing PLC, a London-based company whose stock trades under the symbol BMBYF in the U.S. Investors get to experience benefits even if they own only one share: a 35 percent discount on books published by Bloomsbury.
Bloomsbury, founded in 1986, has subsidiaries in London, New York, Sydney and New Delhi. And the “Harry Potter” series is among the most memorable books published by Bloomsbury.
Although The Walt Disney Company no longer offersdiscounts on Disney park admissionsand merchandise, it does offer something its fans might enjoy beyond dividends. Shareholders have an opportunity to purchase collectible stock certificates for $50. The non-negotiable collectible certificates are designed to commemorate the experience of being a shareholder. Shareholders who choose to gift shares can also purchase one of these to give to the recipient of the gift.
When you have an address in Japan and plan to travel in Japan, you could be eligible for travel discounts through ANA Holdings Inc., a Tokyo passenger and cargo travel company. ANA provides a discount of up to 50 percent off on qualifying airfare to shareholders who own at least 100 of its shares.
Carlson Rezidor Hotel Group, an operator and developer of 1,440 hotels throughout the world, offers shares with perks. Its shareholder benefits include immediate access to the Gold Elite level of the Club Carlson loyalty program, which normally involves a certain number of hotel stays to qualify. The Brussels, Belgium, company requires that the investor own at least 200 shares to participate.
Save More:The Cheapest Times of the Year to Fly to Europe
Shareholders of 3M have benefited from the company’s growth and 49 years of providing one ofthe best dividend stocks. They had also benefited from additional perks. The St. Paul, Minn., company offers a holiday gift box each year during the holiday season. The 2017 holiday box, sold at a discount to retail value, contained 18 3M products, according to Seeking Alpha.
Marks & Spencer PLC, a London retailer, sells shares with perks. Its shares can be purchased on the London stock exchange. Marks & Spencer provides vouchers that provide up to a 10 percent discount on its merchandise that can be purchased at marksandspencer.com.
Lenovo Group Ltd., of Quarry Bay, Hong Kong, which purchased IBM’s personal computer group in 2004, offers discounts to shareholders. Investors are entitled to discounts on its entire product line, including award-winning ThinkPad laptops.
Learn:10 Secrets From Savvy Shoppers to Save You Money
Online Vacation Center Holdings Corp., a Fort Lauderdale, Fla., provider of vacation services, offers a 5 percent discount on bookings to people who own at least 500 shares. The 45-year-old company is one of the country’s largest cruise retailers. Its partners include Viking Cruises and Celebrity Cruises.
The Kilchberg, Switzerland, chocolate maker Lindt & Sprungli AG has some sweet shareholder perks. It provides a gift box to shareholders who vote during its annual meeting. Unfortunately, the company holds its annual meeting in Switzerland and does not mail the gift boxes. As an alternative, you can find Lindt chocolate at a nearby store and treat yourself.
Crimson Wine Group Ltd. of Napa, Calif., offers shareholders a 20 percent discount on select wines. Its shareholder perks also include two complimentary wine tastings at any of its tasting rooms. The $216.5 million company operates eight wineries in California, Oregon and Washington.
LVMH Moet Hennessy Louis Vuitton SE, the Paris-based maker of luxury goods, including clothing, jewelry and wine and spirits, has shares with perks. It operates what it calls the LVMH Shareholders’ Club, which offers its members perks that include access to a special selection of wine, as well as a magazine. One can join the club by submitting an application online or through the mail.
Click to read more abouthow much $1,000 invested in these stocks 10 years ago is worth today.
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Michael McDonaldcontributed to the reporting for this article.
Photos are for illustrative purposes only. As a result, some of the photos might not reflect the items listed in this article.
This article originally appeared onGOBankingRates.com:21 Stock Perks That Will Blow Your Mind |
A Closer Look At Marvel Decor Limited's (NSE:MDL) Uninspiring ROE
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to examine Marvel Decor Limited (NSE:MDL), by way of a worked example.
Our data showsMarvel Decor has a return on equity of 8.0%for the last year. Another way to think of that is that for every ₹1 worth of equity in the company, it was able to earn ₹0.080.
View our latest analysis for Marvel Decor
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Marvel Decor:
8.0% = ₹36m ÷ ₹440m (Based on the trailing twelve months to March 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is the capital paid in by shareholders, plus any retained earnings. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. If you look at the image below, you can see Marvel Decor has a lower ROE than the average (11%) in the Consumer Durables industry classification.
That's not what we like to see. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Still,shareholders might want to check 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 first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
Although Marvel Decor does use debt, its debt to equity ratio of 0.11 is still low. Its ROE is certainly on the low side, and since it already uses debt, we're not too excited about the company. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities.
Return on equity is useful for comparing the quality of different businesses. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. You can see how the company has grow in the past by looking at this FREEdetailed graphof past earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies.
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. |
Elizabeth Hurley wows in sexy yellow bikini at 54
Elizabeth Hurley is back to her old bikini tricks. Just two weeks after ringing in her 54th birthday , the English actress and swimwear designer is sharing yet another stunning swimsuit snap. In a photo guaranteed to chase the clouds aways, Hurley models a bright yellow, aptly named Sunshine bikini with a plunging neckline. Whimsical heart-shaped sunglasses, beachy waves and a slick of pink lipgloss complete the pretty yet playful look. View this post on Instagram A post shared by Elizabeth Hurley (@elizabethhurley1) on Jun 23, 2019 at 12:28pm PDT As ever, fans were blown over by Hurleys photo. Never aging I guess, read one comment. You look better than ever, added a fan. What dont you look good in? one follower wrote. How do you stay so youthful? asked another admirer. Speaking of turning back time, the mom of one son Damian is 17 also recently shared a throwback photo from 2005, the year her first Elizabeth Hurley Beach collection launched. View this post on Instagram A post shared by Elizabeth Hurley (@elizabethhurley1) on Jun 20, 2019 at 11:57am PDT Read more from Yahoo Lifestyle: Elizabeth Hurley, 53, stuns in a barely there bikini: Puts girls in their 20s to shame Kenya Moore celebrates 48th birthday in a bikini with 2-month-old daughter Woman famous for hiking in her bikini freezes to death after tragic fall Follow us on Instagram , Facebook and Twitter for nonstop inspiration delivered fresh to your feed, every day. |
Is METabolic EXplorer S.A. (EPA:METEX) A Volatile Stock?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Anyone researching METabolic EXplorer S.A. ( EPA:METEX ) might want to consider the historical volatility of the share price. Volatility is considered to be a measure of risk in modern finance theory. Investors may think of volatility as falling into two main categories. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The second sort is caused by the natural volatility of markets, overall. For example, certain macroeconomic events will impact (virtually) all stocks on the market. Some stocks mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one. View our latest analysis for METabolic EXplorer What does METEX's beta value mean to investors? Looking at the last five years, METabolic EXplorer has a beta of 1.26. The fact that this is well above 1 indicates that its share price movements have shown sensitivity to overall market volatility. If the past is any guide, we would expect that METabolic EXplorer shares will rise quicker than the markets in times of optimism, but fall faster in times of pessimism. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how METabolic EXplorer fares in that regard, below. Story continues ENXTPA:METEX Income Statement, June 24th 2019 How does METEX's size impact its beta? METabolic EXplorer is a noticeably small company, with a market capitalisation of €37m. Most companies this size are not always actively traded. It has a relatively high beta, suggesting it is fairly actively traded for a company of its size. Because it takes less capital to move the share price of a small company like this, when a stock this size is actively traded it is quite often more sensitive to market volatility than similar large companies. What this means for you: Since METabolic EXplorer tends to moves up when the market is going up, and down when it's going down, potential investors may wish to reflect on the overall market, when considering the stock. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as METabolic EXplorer’s financial health and performance track record. I urge you to continue your research by taking a look at the following: Future Outlook : What are well-informed industry analysts predicting for METEX’s future growth? Take a look at our free research report of analyst consensus for METEX’s outlook. Past Track Record : Has METEX been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look at the free visual representations of METEX's historicals for more clarity. Other Interesting Stocks : It's worth checking to see how METEX measures up against other companies on valuation. You could start with this free list of prospective options . We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor 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. |
Why I Like MagForce AG (FRA:MF6)
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Attractive stocks have exceptional fundamentals. In the case of MagForce AG (FRA:MF6), there's is a company with an optimistic growth outlook, which has not yet been reflected in the share price. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at thereport on MagForce here.
One reason why investors are attracted to MF6 is its notable earnings growth potential in the near future of 50%. This growth in the bottom-line is bolstered by an equally impressive top-line expansion over the same period, which is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. MF6 is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. Investors have the opportunity to buy into the stock to reap capital gains, if MF6's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Also, relative to the rest of its peers with similar levels of earnings, MF6's share price is trading below the group's average. This supports the theory that MF6 is potentially underpriced.
For MagForce, I've put together three fundamental aspects you should further research:
1. Historical Performance: What has MF6'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.
2. 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.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of MF6? 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. |
Danske Bank ousts former interim CEO after customers overcharged
By Stine Jacobsen
COPENHAGEN (Reuters) - Danske Bank has dismissed its former interim chief executive Jesper Nielsen after thousands of Danish customers were overcharged for an investment product, a first step by its new boss to restore trust in the troubled lender.
The case, which the Danish financial services authority called "very serious", is another blow to the reputation of Denmark's biggest bank which is trying to limit the fallout from its involvement in a major money laundering scandal.
Both the FSA and the public prosecutors "are pursuing the possibility of penalizing the bank," the country's acting business minister Rasmus Jarlov said on Facebook.
The dismissal of Nielsen, who headed the bank's domestic banking activities and served as interim CEO until the end of last month, was the first major change since Chris Vogelzang took charge at the start of June.
"Every single day, we must strive to ensure that we offer our customers proper advice and products that suit their needs," said former ABN AMRO banker Vogelzang in a statement.
"As a result of misguided management decisions, we failed to do so in this specific matter, and for this we offer our apologies," he added.
Danske is separately under investigation in the United States and several other countries for payments totaling 200 billion euros ($228 billion) through its small Estonian branch, many of which the bank said were suspicious.
Danske will compensate around 87,000 customers who invested in the Flexinvest Fri product for a total of around 400 million Danish crowns ($61 million). Its shares traded 3% lower by 1240 GMT and have lost around a fifth of their value this year.
"Overall the charge is an unhelpful one-off at a time when public perception of the franchise remains in the spotlight," said KBW analysts in a note.
The fees for the product were raised in connection with the implementation of the MiFID II financial industry regulation in 2017.
"He (Nielsen) was at the time one of the responsible Executive Board members who did not to a sufficient degree ensure that the Flexinvest Fri product was suitable for the bank's customers," Chairman Karsten Dybvad said in a statement.
"Therefore, we find that Jesper cannot continue in his position," added Dybvad, who took up his role last year.
The Danish FSA said in had been investigating the case for some time and expected to make a decision on it by late summer.
"On the basis of the information available, this is a very serious matter," said Jesper Berg, who heads the Danish FSA.
Nielsen served as interim CEO from last October after former chief executive Thomas Borgen resigned when the scope of money laundering case emerged from an internal investigation.
(Reporting by Stine Jacobsen and Jacob Gronholt-Pedersen; Editing by Edmund Blair/Keith Weir) |
Right-wing armed militia member arrested for impersonating border patrol agent
A member of an armed right-wing group known for detaining migrants entering the US has been arrested for impersonating a Border Patrol agent. Jim Benvie is alleged to have impersonated the agent in mid-April, according to two charges filed by the US Department of Justice . The 44-year-old is the spokesperson for the Guardian Patriots, which is one of a number of right-wing armed militias roaming the US- Mexico border. President [Donald] Trump declared a national emergency on the border [and] we came down to find out what that emergency is, Mr Benvie previously said in a video posted online explaining the groups motivations. Mr Benvie was arrested on Friday in Oklahoma , after a warrant was issued for his arrest in New Mexico on Wednesday. The 44-year-old had previously denied that his militia posed as Border Patrol agents. But photographs taken of him in March show Mr Benvie wearing a camouflage jacket with a badge reading Fugitive Recovery Agent and a patch with an eagle-head insignia. He claims to be a citizen journalist gathering proof of the need for the border wall promised by President Trump. Members of the Guardian Patriots live in a camp near Sunland Park, New Mexico . The armed group was originally part of the United Constitutional Patriots, a similar organisation described by the American Civil Liberties Union (ACLU) as a fascist militia. The ACLU said that militia members were illegally detaining migrants who crossed the border at gunpoint. Militia is a term used in a rather fluid manner,Jonathan Turley, a law professor at George Washington University, previously told The Independent . Its loosely defined as an armed group engaged in some paramilitary operation. Mr Turley said the US Supreme Court had ruled that it is an an individual right to bear arms. If militia members lawfully assemble without trespassing, he added, they are allowed to exist in the way neighbourhood patrols do. Larry Hopkins, the UCPs leader, was arrested in April on charges of being a felon in possession of firearms. Story continues Mr Benvie remains in federal custody and is expected to appear at a court hearing on Tuesday. Additional reporting by agencies |
Is There An Opportunity With Lemon Tree Hotels Limited's (NSE:LEMONTREE) 44% Undervaluation?
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Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Lemon Tree Hotels Limited (NSE:LEMONTREE) as an investment opportunity by projecting its future cash flows and then discounting them to today's value. I will use 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. 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 Lemon Tree Hotels
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. In the first stage we need to estimate the cash flows to the business over the next ten years. 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, so we discount the value of these future cash flows to their estimated value in today's dollars:
[{"": "Levered FCF (\u20b9, Millions)", "2019": "\u20b9-731.81", "2020": "\u20b9-206.00", "2021": "\u20b9652.00", "2022": "\u20b93.27k", "2023": "\u20b95.76k", "2024": "\u20b98.97k", "2025": "\u20b912.67k", "2026": "\u20b916.62k", "2027": "\u20b920.62k", "2028": "\u20b924.56k"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x4", "2020": "Analyst x4", "2021": "Analyst x3", "2022": "Analyst x2", "2023": "Est @ 76.35%", "2024": "Est @ 55.71%", "2025": "Est @ 41.26%", "2026": "Est @ 31.15%", "2027": "Est @ 24.07%", "2028": "Est @ 19.11%"}, {"": "Present Value (\u20b9, Millions) Discounted @ 16.48%", "2019": "\u20b9-628.25", "2020": "\u20b9-151.82", "2021": "\u20b9412.53", "2022": "\u20b91.77k", "2023": "\u20b92.69k", "2024": "\u20b93.59k", "2025": "\u20b94.36k", "2026": "\u20b94.90k", "2027": "\u20b95.22k", "2028": "\u20b95.34k"}]
Present Value of 10-year Cash Flow (PVCF)= ₹27.51b
"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 (7.6%) 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 16.5%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = ₹25b × (1 + 7.6%) ÷ (16.5% – 7.6%) = ₹296b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= ₹₹296b ÷ ( 1 + 16.5%)10= ₹64.30b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is ₹91.81b. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of ₹115.89. Relative to the current share price of ₹64.75, the company appears quite undervalued at a 44% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the 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 Lemon Tree Hotels 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 16.5%, which is based on a levered beta of 1.039. 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.
Whilst important, DCF calculation 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. What is the reason for the share price to differ from the intrinsic value? For Lemon Tree Hotels, I've put together three important aspects you should further research:
1. Financial Health: Does LEMONTREE 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 LEMONTREE'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 LEMONTREE? 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 IN 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. |
Is Max Financial Services Limited (NSE:MFSL) Overpaying Its CEO?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Mohit Talwar became the CEO of Max Financial Services Limited ( NSE:MFSL ) in 2016. 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. 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 Max Financial Services How Does Mohit Talwar's Compensation Compare With Similar Sized Companies? At the time of writing our data says that Max Financial Services Limited has a market cap of ₹113b, and is paying total annual CEO compensation of ₹144m. (This figure is for the year to March 2018). While we always look at total compensation first, we note that the salary component is less, at ₹33m. We looked at a group of companies with market capitalizations from ₹70b to ₹223b, and the median CEO total compensation was ₹39m. As you can see, Mohit Talwar is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Max Financial Services Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance. You can see, below, how CEO compensation at Max Financial Services has changed over time. NSEI:MFSL CEO Compensation, June 24th 2019 Is Max Financial Services Limited Growing? Over the last three years Max Financial Services Limited has shrunk its earnings per share by an average of 2.5% per year (measured with a line of best fit). In the last year, its revenue is up 19%. Unfortunately there is a complete lack of earnings per share improvement, over three years. And while it's good to see some good revenue growth recently, the growth isn't really fast enough for me to put aside my concerns around earnings. These factors suggest that the business performance wouldn't really justify a high pay packet for the CEO. Shareholders might be interested in this free visualization of analyst forecasts. Story continues Has Max Financial Services Limited Been A Good Investment? Given the total loss of 21% over three years, many shareholders in Max Financial Services Limited are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously. In Summary... We examined the amount Max Financial Services Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group. Earnings per share have not grown in three years, and the revenue growth fails to impress us. Just as bad, share price gains for investors have failed to materialize, over the same period. This analysis suggests to us that the CEO is paid too generously! So you may want to check if insiders are buying Max Financial Services shares with their own money (free access). Arguably, business quality is much more important than CEO compensation levels. So check out this free list 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 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. |
Is MITCON Consultancy & Engineering Services Limited (NSE:MITCON) 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 MITCON Consultancy & Engineering Services Limited ( NSE:MITCON ) with its market cap of ₹581m, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Assessing first and foremost the financial health is 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. Nevertheless, this is just a partial view of the stock, and I’d encourage you to dig deeper yourself into MITCON here . Does MITCON Produce Much Cash Relative To Its Debt? MITCON has increased its debt level by about ₹456m over the last 12 months including long-term debt. With this ramp up in debt, MITCON currently has ₹109m remaining in cash and short-term investments to keep the business going. On top of this, MITCON has produced ₹75m in operating cash flow during the same period of time, leading to an operating cash to total debt ratio of 16%, meaning that MITCON’s current level of operating cash is not high enough to cover debt. Does MITCON’s liquid assets cover its short-term commitments? With current liabilities at ₹162m, the company has been able to meet these commitments with a current assets level of ₹348m, leading to a 2.15x current account ratio. The current ratio is the number you get when you divide current assets by current liabilities. For Professional Services companies, this ratio is within a sensible range since there's a sufficient cash cushion without leaving too much capital idle or in low-earning investments. NSEI:MITCON Historical Debt, June 24th 2019 Can MITCON service its debt comfortably? MITCON is a relatively highly levered company with a debt-to-equity of 52%. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. Next Steps: MITCON’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. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. Keep in mind I haven't considered other factors such as how MITCON has been performing in the past. I recommend you continue to research MITCON Consultancy & Engineering Services to get a more holistic view of the small-cap by looking at: Story continues Future Outlook : What are well-informed industry analysts predicting for MITCON’s future growth? Take a look at our free research report of analyst consensus for MITCON’s outlook. Historical Performance : What has MITCON's returns been like over the past? Go into more detail in the past track record analysis and take a look at the free visual representations of our analysis for more clarity. Other High-Performing Stocks : Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here . We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. View comments |
UPDATE 2-Qatar teams up with Chevron Phillips for petrochemical project
(Adds quotes, context)
DOHA, June 24 (Reuters) - Qatar Petroleum has signed an agreement with Chevron Phillips Chemical to build a new petrochemicals complex, part of plans by the world's top liquefied natural gas (LNG) exporter to broaden its energy interests.
The project highlights how Middle East oil producers are expanding further into petrochemicals, used in the production of plastics and packaging materials, to move into new markets and find new sources of income beyond exporting crude oil and natural gas.
Saudi Arabia's and UAE's national oil companies have both already announced plans to boost their refining capacity and petrochemicals operations.
Qatar is one of the most influential players in the LNG market due to its annual production of about 77 million tonnes, which is expected to grow about 43 percent by 2024 from a major expansion to the country's North Field, the world's largest natural gas field, which it shares with Iran.
The new petrochemical plant will be built north of Doha in Ras Laffan Industrial City and will come online by 2025 and tap the increased North Field production for feedstock, Qatar Petroleum CEO Saad al-Kaabi told a news conference.
"The decision was driven by the ongoing development of the expansion project of the North Field ... which will yield significant quantities of ethane which can be used as feedstock," Kaabi said.
Chevron Phillips Chemical Co -- a joint venture of Chevron Corp and Phillips 66 -- will own a 30% stake in the complex, with the rest owned by Qatar Petroleum.
Qatar is embroiled in a protracted diplomatic and trade boycott imposed on it by Saudi Arabia, the United Arab Emirates, Bahrain and Egypt in 2017, with the bloc accusing it of supporting militants, a charge Doha denies.
Qatar has since charted a more independent course in the region, leaving OPEC last year and striking new trade deals, while putting more focus on its traditional strength in energy with QP's North Field expansion and acquisitions of energy assets abroad.
Qatar's plant will include an ethane cracker with an annual ethylene capacity of about 1.9 million tonnes, making it the Middle East's largest and one of the biggest in the world, said Kaabi, adding that the plant will increase Qatar's polyethylene output capacity by 82%.
Kaabi said it was too early to give an estimated cost for the project as the engineering study was not over yet but added that the complex's cost would be in the "billions of dollars".
Qatar produces about 2,300 tonnes per year of polyethylene, and the plant will raise its output potential to about 4,300 tonnes. (Reporting by Eric Knecht; writing by Rania El Gamal; editing by Louise Heavens/Alexander Smith/Jane Merriman) |
Mercedes-Benz owner issues profit warning
The Mercedes emblem is seen on a Vision Mercedes-Maybach Ultimate Luxury show car. Photo: Reuters/Hannibal Hanschke Mercedes-Benz owner Daimler issued a profit warning on Sunday evening, a day after it was ordered to recall 60,000 vehicles over alleged emissions-manipulating software. Daimler said it had revised its provision for costs tied to diesel-related issues upwards to “a high three-digit million euro amount.” It expects group earnings before interest and tax to be about the same as last year. This was Daimler’s third profit warning in a year. The company will release its second-quarter earnings on 24 July. On 22 June, Germany’s transport ministry said it had ordered Daimler to recall 60,000 Mercedes-Benz GLK220 CDI models, after regulators found they were fitted with suspicious software designed to manipulate emissions levels during tests. The cars in question were produced between 2012 and 2015. The car company denies any misconduct, but will still have to bring the cars back to the garage for fixing. The number of recalls may end up being higher, as the transport ministry is currently investigating other Mercedes models. Like its rival Volkswagen, Daimler has been ensnared in the emissions-cheating scandal that came to light in 2015, and has now recalled some three million cars in total, 770,000 of them in 2018 alone. Daimler’s new CEO Ole Källenius, who took over from Dieter Zetsche in May, is looking to drive down development and procurement costs as the company shifts to electric mobility. At the company’s annual general meeting in May, Källenious said he wanted to ramp up alliances with other carmakers to lower development costs, as well as reduce the amount of expensive components like cobalt in its car batteries. |
Here's What CFM Indosuez Wealth Société anonyme's (EPA:MLCFM) P/E Is Telling Us
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The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to CFM Indosuez Wealth Société anonyme's (EPA:MLCFM), to help you decide if the stock is worth further research. Based on the last twelve months,CFM Indosuez Wealth Société anonyme's P/E ratio is 19.71. That means that at current prices, buyers pay €19.71 for every €1 in trailing yearly profits.
See our latest analysis for CFM Indosuez Wealth Société anonyme
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for CFM Indosuez Wealth Société anonyme:
P/E of 19.71 = €1000 ÷ €50.74 (Based on the trailing twelve months to December 2018.)
A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E.
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. So while a stock may look cheap based on past earnings, it could be expensive based on future earnings.
CFM Indosuez Wealth Société anonyme saw earnings per share decrease by 35% last year. And it has shrunk its earnings per share by 3.7% per year over the last five years. This could justify a pessimistic P/E.
We can get an indication of market expectations by looking at the P/E ratio. The image below shows that CFM Indosuez Wealth Société anonyme has a higher P/E than the average (7.7) P/E for companies in the banks industry.
That means that the market expects CFM Indosuez Wealth Société anonyme will outperform other companies in its industry. Shareholders are clearly optimistic, but the future is always uncertain. So investors should always consider the P/E ratio alongside other factors, such aswhether company directors have been buying shares.
Don't forget that the P/E ratio considers market capitalization. So it won't reflect the advantage of cash, or disadvantage of debt. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash).
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
With net cash of €280m, CFM Indosuez Wealth Société anonyme has a very strong balance sheet, which may be important for its business. Having said that, at 49% of its market capitalization the cash hoard would contribute towards a higher P/E ratio.
CFM Indosuez Wealth Société anonyme has a P/E of 19.7. That's higher than the average in the FR market, which is 17.9. The recent drop in earnings per share would make some investors cautious, but the relatively strong balance sheet will allow the company time to invest in growth. Clearly, the high P/E indicates shareholders think it will!
When the market is wrong about a stock, it gives savvy investors an opportunity. If the reality for a company is better than it expects, you can make money by buying and holding for the long term. We don't have analyst forecasts, but you could get a better understanding of its growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
You might be able to find a better buy than CFM Indosuez Wealth Société anonyme. 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. |
Introducing Midsummer (STO:MIDS), A Stock That Climbed 51% In The Last Year
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The simplest way to invest in stocks is to buy exchange traded funds. But you can significantly boost your returns by picking above-average stocks. For example, theMidsummer AB (publ)(STO:MIDS) share price is up 51% in the last year, clearly besting than the market return of around 6.9% (not including dividends). So that should have shareholders smiling. We'll need to follow Midsummer for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.
Check out our latest analysis for Midsummer
In his essayThe Superinvestors of Graham-and-DoddsvilleWarren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
During the last year, Midsummer actually saw its earnings per share drop 32%. So we don't think that investors are paying too much attention to EPS. Indeed, when EPS is declining but the share price is up, it often means the market is considering other factors.
However the year on year revenue growth of 32% would help. Many businesses do go through a faze where they have to forgo some profits to drive business development, and sometimes its for the best.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
If you are thinking of buying or selling Midsummer stock, you should check out thisFREEdetailed report on its balance sheet.
It's nice to see that Midsummer shareholders have gained 51% over the last year. And the share price momentum remains respectable, with a gain of 28% in the last three months. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. If you would like to research Midsummer in more detail then you might want totake a look at whether insiders have been buying or selling shares in the company.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on 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. |
Crypto miners in Iran will face power cuts, official warns
Cryptocurrency miners in Iran will be detected and face power cuts, an official from the country's state-run power generation and transmission company Tavanir, has warned.
According to areportfrom Iran Front Page (IFP) News, Mostafa Rajabi Mashhadi has said that it is illegal to use the national grid for cryptocurrency mining. Mashhadi also said that Iran's electricity consumption in May had increased by 7 percent year-on-year and that cryptocurrency miners were the main reason.
Earlier this month, Iran's deputy energy minister Homayoun Haeri alsosaidthat power bills for cryptocurrency miners should not be subsidized by the state, as the government pays nearly $1 billion in subsidies annually to reduce energy costs for consumers. |
Three Things You Should Check Before Buying Lakshmi Machine Works Limited (NSE:LAXMIMACH) For Its Dividend
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Could Lakshmi Machine Works Limited (NSE:LAXMIMACH) 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 the income from dividends, it's important to be a lot more stringent with your investments than the average punter.
Investors might not know much about Lakshmi Machine Works's dividend prospects, even though it has been paying dividends for the last nine years and offers a 0.7% yield. While the yield may not look too great, the relatively long payment history is interesting. The company also bought back stock during the year, equivalent to approximately 2.8% of the company's market capitalisation at the time. Some simple analysis can reduce the risk of holding Lakshmi Machine Works for its dividend, and we'll focus on the most important aspects below.
Click the interactive chart for our full dividend analysis
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. Lakshmi Machine Works paid out 21% of its profit as dividends, over the trailing twelve month period. We'd say its dividends are thoroughly covered by earnings.
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, Lakshmi Machine Works 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.
Consider gettingour latest analysis on Lakshmi Machine Works'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. The first recorded dividend for Lakshmi Machine Works, 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 ₹15.00 in 2010, compared to ₹35.00 last year. This works out to be a compound annual growth rate (CAGR) of approximately 9.9% a year over that time. Lakshmi Machine Works's dividend payments have fluctuated, so it hasn't grown 9.9% every year, but the CAGR is a useful rule of thumb for approximating the historical growth.
Dividends have grown at a reasonable rate, but with at least one substantial cut in the payments, we're not certain this dividend stock would be ideal for someone intending to live on the income.
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. Lakshmi Machine Works'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. Growth has been hard to come by. On the plus side, the dividend payout ratio is low and dividends could grow faster than earnings, if the company decides to increase its payout ratio.
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, the company has a conservative payout ratio, although we'd note that its cashflow in the past year was substantially lower than its reported profit. Unfortunately, earnings growth has also been mediocre, and the company has cut its dividend at least once in the past. Ultimately, Lakshmi Machine Works comes up short on our dividend analysis. It's not that we think it is a bad company - just that there are likely more appealing dividend prospects out there on this analysis.
See if management have their own wealth at stake, by checking insider shareholdings inLakshmi Machine Works 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. |
BIS Wants ‘Level Playing Field’ for Banks Amid Threat from Facebook
The Bank for International Settlements (BIS), often described as the bank for central banks, has issued its annual report for 2019, expressing concerns over the expected disruption as big tech firms like Facebook enter the financial space.
While titled “Big tech in finance: opportunities and risks,”the reportlooks at the risks and challenges posed by companies such as Alibaba, Amazon, Facebook, Google and Tencent, rather than paying lip service to the potential benefits of this building fintech revolution.
These firms have developed huge customer bases, says BIS, and have the benefit of a “data-network-activities loop” which gives them ” the potential to become dominant.”
Related:Russia May Allow Crypto Trading in Upcoming Legislation: Official
While the encroach of such companies into payments, money management, insurance and lending has only just started, it brings the potential for major change in the finance industry.
On the benefits, BIS writes:
“Big techs’ low-cost structure business can easily be scaled up to provide basic financial services, especially in places where a large part of the population remains unbanked. Using big data and analysis of the network structure in their established platforms, big techs can assess the riskiness of borrowers, reducing the need for collateral to assure repayment. As such, big techs stand to enhance the efficiency of financial services provision, promote financial inclusion and allow associated gains in economic activity.”
However, such change brings new risks, according to the report. As well as the old issues of financial stability and consumer protection, “big techs have the potential to loom large very quickly as systemically relevant financial institutions.” At this point, BIS specifically raises the recent reports ofFacebook’s new Libra project, which sees the social media giant “considering offering payment services for their customers on a global basis.”
Related:Facebook Seeking Crypto Wallet Data Engineer, Regulatory Policy Expert
There are also “important new and unfamiliar challenges” that, BIS suggests, go beyond the remit of current regulations. The report says that “Big techs have the potential to become dominant through the advantages afforded by the data-network-activities loop, raising competition and data privacy issues.”
As such, policies will be needed for a “comprehensive approach” on financial regulation, competition policy and data privacy regulation.
“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,” according to the report.
In a somewhat telling statement, BIS further reveals its fears that banks could lose ground to the new big tech disruptors saying:
“Regulators need to ensure a level playing field between big techs and banks, taking into account big techs’ wide customer base, access to information and broad-ranging business models.”
And with such major companies having the ability to work across borders, international coordination is needed on rules and standards to address the potential shift in the “risk-benefit balance,” says BIS.
As the report suggests, Facebook’s crypto project maynot have an easy timewith the world’s regulators as the firm seeks to launch financial services for its billions of users.
France has alreadymoved to createa task force within the G7 nations to examine the issues raised by Libra, whileU.S. lawmakershave also expressed concerns over the project.
BIS headquartersimage via Shutterstock
• This Ethereum Lottery Perfectly Explains How Facebook’s Big Corporate Backers Will Profit from Crypto
• A Monumental Fight Over Facebook’s Cryptocurrency Is Coming |
Does Laxmi Cotspin Limited's (NSE:LAXMICOT) Past Performance Indicate A Stronger Future?
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Today I will take a look at Laxmi Cotspin Limited's (NSE:LAXMICOT) most recent earnings update (31 March 2019) and compare these latest figures against its performance over the past few years, as well as how the rest of the luxury industry performed. As an investor, I find it beneficial to assess LAXMICOT’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time.
Check out our latest analysis for Laxmi Cotspin
LAXMICOT's trailing twelve-month earnings (from 31 March 2019) of ₹37m has jumped 42% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 0.04%, indicating the rate at which LAXMICOT is growing has accelerated. How has it been able to do this? Let's see whether it is solely due to industry tailwinds, or if Laxmi Cotspin has seen some company-specific growth.
In terms of returns from investment, Laxmi Cotspin has fallen short of achieving a 20% return on equity (ROE), recording 7.8% instead. Furthermore, its return on assets (ROA) of 6.3% is below the IN Luxury industry of 6.3%, indicating Laxmi Cotspin's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Laxmi Cotspin’s debt level, has increased over the past 3 years from 11% to 11%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 91% to 90% over the past 5 years.
Laxmi Cotspin's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that have performed well in the past, such as Laxmi Cotspin gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research Laxmi Cotspin to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for LAXMICOT’s future growth? Take a look at ourfree research report of analyst consensusfor LAXMICOT’s outlook.
2. Financial Health: Are LAXMICOT’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. |
Nissan shareholders set to back CEO Saikawa amid fraying ties with Renault
By Naomi Tajitsu and Maki Shiraki
TOKYO (Reuters) - Nissan Motor shareholders are widely expected to back Chief Executive Hiroto Saikawa at an annual general meeting on Tuesday, extending his tumultuous tenure at an automaker shaken by scandal and the loss of trust with alliance partner Renault.
Japan's second-largest carmaker on Tuesday will hold its first annual shareholders meeting since the ouster of former Chairman Carlos Ghosn last year, and just days after Saikawa resolved a highly publicized tussle with top shareholder Renault over Nissan's corporate governance reforms.
Although that maneuvering helped pull the Nissan-Renault alliance back from the brink of crisis, the former Ghosn lieutenant is now faced with the unenviable task of trying to shore up a two-decade-old partnership that many in Japan see as lopsided, deeply inequitable and shot through with mistrust on both sides.
"The most important thing is how to mitigate the damage ... how to strengthen the alliance. I think both companies need to make their best efforts to overcome the mistrust," said a person familiar with Nissan's thinking.
The partnership hit a new low this month when Renault demanded that its chairman and chief executive be appointed to newly formed governance committees at Nissan. If not, Renault signaled it would block Nissan from adopting its new governance structure - effectively ruining months of work by an outside body.
Renault, by far the smaller of the two, owns 43.4% of Nissan after rescuing it from the brink of bankruptcy in 1999. Nissan owns 15% of the French company, but without voting rights. That unequal relationship has long been a source of friction.
There has been wide speculation that Renault's governance move was a reprisal after Nissan had abstained from endorsing Renault's planned merger with Fiat Chrysler Automobiles.
The stand-off was averted when Nissan agreed to appoint Renault Chairman Jean-Dominique Senard and Chief Executive Thierry Bollore to its audit and nominations committees, even as Nissan itself will not be represented on those committees.
"Almost a week was spent in negotiations (on the committees) and clearly that would damage trust toward Renault and probably between the two companies," said the person familiar with Nissan's thinking.
TENSIONS DIALLED DOWN
By agreeing to Renault's demand, Saikawa has dialed down tensions and likely won a reprieve on his two-year tenure. The embattled CEO will be re-appointed as a director if shareholders vote to approve a new 11-member board, a widely expected outcome with Renault's backing.
"If Renault abstained on the governance reform proposals, it would put a big question mark on Saikawa's ability to manage Nissan as its chief executive," one Nissan source said.
Instead, Saikawa appears to have quelled internal concerns, at least for now, about his ability to manage the automaker's relationship with Renault just as he also faces pressure to resuscitate Nissan's flagging financial performance.
Reappointment would also see him defy opposition by proxy advisors brought about by concerns that with Saikawa in charge, the automaker would be unable to make a "clean break" from the Ghosn era. Renault CEO Bollore is also a former Ghosn ally.
In a rare public rebuke by international proxy firms against the leader of a top-tier Japanese firm, International Shareholder Services and Glass Lewis earlier this month urged Nissan shareholders to vote against reappointing Saikawa as a director.
But people at both automakers said the recent tussle has dissolved the image of unity the companies promoted only months ago, and raised questions about whether Senard and Saikawa are the right people to shake the alliance free from Ghosn's legacy in the longer term.
"Senard has been a disappointment for us. Trust in him has fallen quite a bit," said a second person familiar with Nissan's thinking.
Industry experts acknowledge that a break-up of the alliance is unlikely given that operations at Nissan and Renault are so deeply intertwined - the automakers have joined forces on research and development, procurement and production, leveraging their combined scale to lower costs.
"Maybe the alliance can be salvaged, but maybe not by this group of people," said Chris Richter, senior research analyst at brokerage CLSA.
"It seems like both of these companies have a lot to offer, but the current players just can't get along."
(Reporting by Maki Shiraki and Naomi Tajitsu; Additional reporting by Linda Sieg in Tokyo and Norihiko Shirouzu in Beijing; Editing by David Dolan and Christopher Cushing) |
Was Laxmi Cotspin Limited's (NSE:LAXMICOT) Earnings Growth Better Than The Industry's?
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Understanding Laxmi Cotspin Limited's (NSE:LAXMICOT) 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 Laxmi Cotspin is doing by evaluating its latest earnings with its longer term trend as well as its industry peers' performance over the same period.
Check out our latest analysis for Laxmi Cotspin
LAXMICOT's trailing twelve-month earnings (from 31 March 2019) of ₹37m has jumped 42% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 0.04%, indicating the rate at which LAXMICOT is growing has accelerated. How has it been able to do this? Let's take a look at whether it is solely due to industry tailwinds, or if Laxmi Cotspin has seen some company-specific growth.
In terms of returns from investment, Laxmi Cotspin has fallen short of achieving a 20% return on equity (ROE), recording 7.8% instead. Furthermore, its return on assets (ROA) of 6.3% is below the IN Luxury industry of 6.3%, indicating Laxmi Cotspin's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Laxmi Cotspin’s debt level, has increased over the past 3 years from 11% to 11%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 91% to 90% over the past 5 years.
Though Laxmi Cotspin's past data is helpful, it is only one aspect of my investment thesis. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? I suggest you continue to research Laxmi Cotspin to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for LAXMICOT’s future growth? Take a look at ourfree research report of analyst consensusfor LAXMICOT’s outlook.
2. Financial Health: Are LAXMICOT’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. |
Is Latteys Industries Limited's (NSE:LATTEYS) High P/E Ratio A Problem For Investors?
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This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll show how you can use Latteys Industries Limited's (NSE:LATTEYS) P/E ratio to inform your assessment of the investment opportunity.What is Latteys Industries's P/E ratio?Well, based on the last twelve months it is 26.34. In other words, at today's prices, investors are paying ₹26.34 for every ₹1 in prior year profit.
See our latest analysis for Latteys Industries
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for Latteys Industries:
P/E of 26.34 = ₹45.3 ÷ ₹1.72 (Based on the trailing twelve months to March 2019.)
A higher P/E ratio means that buyers have to paya higher pricefor each ₹1 the company has earned over the last year. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E.
Earnings growth rates have a big influence on P/E ratios. When earnings grow, the 'E' increases, over time. That means even if the current P/E is high, it will reduce over time if the share price stays flat. Then, a lower P/E should attract more buyers, pushing the share price up.
Latteys Industries saw earnings per share decrease by 45% last year. But over the longer term (5 years) earnings per share have increased by 24%.
The P/E ratio essentially measures market expectations of a company. The image below shows that Latteys Industries has a higher P/E than the average (14.4) P/E for companies in the machinery industry.
Its relatively high P/E ratio indicates that Latteys Industries shareholders think it will perform better than other companies in its industry classification. Clearly the market expects growth, but it isn't guaranteed. So investors should delve deeper. I like to checkif company insiders have been buying or 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. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash).
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
Latteys Industries has net debt worth 51% of its market capitalization. This is a reasonably significant level of debt -- all else being equal you'd expect a much lower P/E than if it had net cash.
Latteys Industries has a P/E of 26.3. That's higher than the average in the IN market, which is 15.4. With meaningful debt and a lack of recent earnings growth, the market has high expectations that the business will earn more in the future.
When the market is wrong about a stock, it gives savvy investors an opportunity. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' Although we don't have analyst forecasts, you could get a better understanding of its growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
You might be able to find a better buy than Latteys Industries. 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. |
Pence Says Filthy Detention Facilities Heartbreaking, But It's All On Congress
Vice President Mike Pence said in an interview Sunday that reports of atrocious conditions at migrant detention centers along the southern border were “heartbreaking,” but failed to take any responsibility. He said the Trump administration could do little to address the lack of basic sanitation at the facilities because of Congress. Pence spoke with CBS’ “Face the Nation” on Sunday, where he was asked about accounts from attorneys who last week told The Associated Press and The New York Times that some migrant kids had been held without basic sanitation needs for more than a month at a border patrol station in Texas. The accounts describe scenarios where some children were taking care of other children, instances where kids were seen wearing filthy clothing and lacking toothbrushes, toothpaste and soap . CBS’ Margaret Brennan asked Pence about the reports. While the vice president called them “totally unacceptable,” he moved to blame Congress and migrants themselves, who have been crossing the border in vast numbers. . @VP Mike Pence tells @margbrennan the conditions in U.S. immigration facilities are not acceptable. “It is heartbreaking to see what you see,” he says, “If Democrats in Congress will simply step up...we can solve the crisis.” https://t.co/nrJlANXoW3 pic.twitter.com/a4CusDvm98 — Face The Nation (@FaceTheNation) June 23, 2019 “The American people deserve to know that our dedicated Customs and Border Patrol agents are literally being overwhelmed by hundreds of thousands of people coming across our border to take advantage of loopholes in our laws,” Pence said, before turning toward efforts in Congress. “We’ve asked for more bed space, we’ve asked for more support. Our Customs and Border Patrol agents are doing a- a job but the system is overwhelmed.” Story continues Brennan later asked what the executive branch, which oversees the Department of Homeland Security and immigration efforts, planned to do about the reports. "So how is the executive totally powerless to do anything about these unsafe, unsanitary conditions?” Brennan asked. “Well, we’re- we’re- we’re- we’re doing a lot with what the Congress has given us,” Pence said. “But again, Congress refused to increase the bed space in the last appropriations bill.” “We just have to accept these conditions … that are being described here?” Brennan replied. “No, absolutely not. It’s one of the reasons why the president’s taken the strong stand that he’s taken on the crisis on our southern border,” Pence said. “That’s why the president took the strong stand that he took with Mexico just a few short weeks ago.” The vice president later said the situation was “heartbreaking,” but again cast blame on Democrats and said the president was “doing his job.” In an interview that aired earlier on Sunday with CNN, Pence also said that “ of course ” the Trump administration should provide migrant children with access to sanitary products. The Trump administration has continued to take a hard line against undocumented immigration in recent weeks, and the president sent out a missive on Twitter saying immigration officials were preparing to deport “millions” of migrants within the coming days. Trump walked back those claims on Saturday, saying he was giving lawmakers two weeks to put together a deal to the “asylum and loophole problems at the southern border.” But earlier in the week, a Justice Department attorney argued that the federal government should not be required to provide soap or toothbrushes to children detained while trying to cross into the U.S. Related... Justice Department Argues Against Providing Soap, Toothbrushes, Beds To Detained Kids Trump Claims Administration Doing 'Fantastic Job' Housing Migrant Kids At Border Utah Newspaper Says U.S. Is Running 'Concentration Camps For Refugee Children' Love HuffPost? Become a founding member of HuffPost Plus today. This article originally appeared on HuffPost . |
CabbageTech CEO pleads guilty to cryptocurrency fraud
Patrick McDonnell, who ran CabbageTech Corp., has pleaded guilty to wire fraud in a scheme that defrauded at least ten cryptocurrency investors, according to anannouncementon Friday from the US Attorney's office.
Between November 2014 and January 2018, McDonnell posed as an experienced cryptocurrency trader, promising investors he would purchase and trade virtual currency on their behalf. However, he sent investors false balance statements and stole their money for his personal use, the Office said, amouting to at least $194,000 in fiat, 4.41 bitcoin, 206 litecoin, 620 ether classic and 1,342,634 verge tokens.
“McDonnell has admitted that he used old-fashioned deception to defraud investors seeking to trade 21st century currencies,” said Richard P. Donoghue, attorney for the Eastern District of New York.
McDonnell wasarrestedin March of this year and now faces up to 20 years in jail as well as forfeiture and restitution to his victims, according to Friday’s announcement.
Donoghue added that the Office and law enforcement partners will “continue to prosecute those who swindle the investing public to the full extent of the law.” |
Was Lakshmi Machine Works Limited's (NSE:LAXMIMACH) Earnings Decline Part Of A Broader Industry Downturn?
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Today I will take a look at Lakshmi Machine Works Limited's (NSE:LAXMIMACH) most recent earnings update (31 March 2019) and compare these latest figures against its performance over the past few years, as well as how the rest of the machinery industry performed. As an investor, I find it beneficial to assess LAXMIMACH’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time.
See our latest analysis for Lakshmi Machine Works
LAXMIMACH's trailing twelve-month earnings (from 31 March 2019) of ₹1.9b has declined by -14% 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 -1.0%, indicating the rate at which LAXMIMACH is growing has slowed down. Why could this be happening? Well, let's look at what's going on with margins and whether the entire industry is experiencing the hit as well.
In terms of returns from investment, Lakshmi Machine Works has fallen short of achieving a 20% return on equity (ROE), recording 11% instead. Furthermore, its return on assets (ROA) of 4.7% is below the IN Machinery industry of 7.7%, indicating Lakshmi Machine Works's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Lakshmi Machine Works’s debt level, has declined over the past 3 years from 15% to 13%.
While past data is useful, it doesn’t tell the whole story. In some cases, companies that endure a drawn out period of decline in earnings are going through some sort of reinvestment phase in order to keep up with the latest industry expansion and disruption. I recommend you continue to research Lakshmi Machine Works to get a more holistic view of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for LAXMIMACH’s future growth? Take a look at ourfree research report of analyst consensusfor LAXMIMACH’s outlook.
2. Financial Health: Are LAXMIMACH’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. |
Lakshmi Machine Works Limited (NSE:LAXMIMACH): Should The Recent Earnings Drop Worry You?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
In this article, I will take a look at Lakshmi Machine Works Limited's (NSE:LAXMIMACH) most recent earnings update (31 March 2019) and compare these latest figures against its performance over the past few years, along with how the rest of LAXMIMACH's industry performed. As a long-term investor, I find it useful to analyze the company's trend over time in order to estimate whether or not the company is able to meet its goals, and eventually grow sustainably over time.
Check out our latest analysis for Lakshmi Machine Works
LAXMIMACH's trailing twelve-month earnings (from 31 March 2019) of ₹1.9b has declined by -14% 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 -1.0%, indicating the rate at which LAXMIMACH is growing has slowed down. What could be happening here? Well, let's look at what's occurring with margins and whether the whole industry is experiencing the hit as well.
In terms of returns from investment, Lakshmi Machine Works has fallen short of achieving a 20% return on equity (ROE), recording 11% instead. Furthermore, its return on assets (ROA) of 4.7% is below the IN Machinery industry of 7.7%, indicating Lakshmi Machine Works's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Lakshmi Machine Works’s debt level, has declined over the past 3 years from 15% to 13%.
While past data is useful, it doesn’t tell the whole story. Generally companies that face a drawn out period of diminishing earnings are going through some sort of reinvestment phase with the aim of keeping up with the latest industry disruption and growth. You should continue to research Lakshmi Machine Works to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for LAXMIMACH’s future growth? Take a look at ourfree research report of analyst consensusfor LAXMIMACH’s outlook.
2. Financial Health: Are LAXMIMACH’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. |
I Ran A Stock Scan For Earnings Growth And Lacroix (EPA:LACR) Passed With Ease
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Like a puppy chasing its tail, some new investors often chase 'the next big thing', even if that means buying 'story stocks' without revenue, let alone profit. But as Warren Buffett has mused, 'If you've been playing poker for half an hour and you still don't know who the patsy is, you're the patsy.' When they buy such story stocks, investors are all too often the patsy.
In contrast to all that, I prefer to spend time on companies likeLacroix(EPA:LACR), which has not only revenues, but also profits. While that doesn't make the shares worth buying at any price, you can't deny that successful capitalism requires profit, eventually. 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 Lacroix
Over the last three years, Lacroix 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, Lacroix's EPS soared from €2.16 to €2.99, over the last year. That's a impressive gain of 38%.
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). Lacroix maintained stable EBIT margins over the last year, all while growing revenue 2.4% to €470m. 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 Lacroix'sfutureprofits.
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 Lacroix shares worth a considerable sum. To be specific, they have €11m worth of shares. That's a lot of money, and no small incentive to work hard. Those holdings account for over 14% of the company; visible skin in the game.
For growth investors like me, Lacroix'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, just because Lacroix 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.
You can invest in any company you want. But if you prefer to focus on stocks that have demonstrated insider buying, here isa list of companies with insider buying in the last three months.
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. |
Stocks - Wall Street Flat as U.S-Iranian Tensions Counter Trade Talk Progress
Investing.com - Wall Street was flat on Monday as tensions with Iran countered news of trade talk progress.
China confirmed that President Xi Jinping will meet with U.S. President Donald Trump on the sidelines of the G20 summit. While it's uncertain if a deal will be reached, both sides have resumed trade talks ahead of the meeting.
The S&P 500 inched down 0.7 points by 9:53 AM ET (13:53 GMT). The Dow was up 60 points and tech-heavy Nasdaq composite fell 5 points.
“Markets are generally optimistic about the fact that both sides are continuing to meet, talk, discuss and debate tariffs, and so there’s still the potential for progress,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab.
“Don’t think markets are expecting a deal, but at least as long as there’s dialogue, there’s hope for progress.”
Still, stocks were kept in check by rising tensions between the U.S. and Iran, with more sanctions against Tehran expected to be announced on Monday.
Last week President Donald Trump ordered and then called off a military strike in response to Iran shooting down an unmanned U.S. drone.
Shares of Boeing (NYSE:BA), which is sensitive to trade issues, rose 0.7%, while chipmaker Micron (NASDAQ:MU) gained 1.2% and Netflix (NASDAQ:NFLX) rose 1.2%
Caesars Entertainment (NASDAQ:CZR) surged 14.4% after casino operator Eldorado Resorts (NASDAQ:ERI) agreed to merge with it in a cash and stock deal that valued Caesars at about $17.3 billion including debt. Eldorado fell 9.1%.
Elsewhere, Advanced Micro Devices (NASDAQ:AMD) slumped 1%, while Walt Disney (NYSE:DIS) slipped 0.6% and Beyond Meat (NASDAQ:BYND) was down 7.6%.
Celgene (NASDAQ:CELG) fell 4.2% after Bristol-Myers Squibb (NYSE:BMY) said its acquisition of the drugmaker was expected to close at the end of 2019 or beginning 2020, compared to earlier expectations of the deal closing in the third quarter.
In commodities, crude oil rose 0.1% to $57.45 a barrel. Gold futures gained 0.7% to $1,410.50 a troy ounce, while the U.S. dollar index, which measures the greenback against a basket of six major currencies, fell 0.1% to 95.623.
-- Reuters contributed to this report.
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Does Cathay General Bancorp (NASDAQ:CATY) Deserve A Spot On Your Watchlist?
Want to participate in a short 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. But as Peter Lynch said in One Up On Wall Street , 'Long shots almost never pay off.' In the age of tech-stock blue-sky investing, my choice may seem old fashioned; I still prefer profitable companies like Cathay General Bancorp ( NASDAQ:CATY ). While that doesn't make the shares worth buying at any price, you can't deny that successful capitalism requires profit, eventually. 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 Cathay General Bancorp Cathay General Bancorp's Earnings Per Share Are Growing. As one of my mentors once told me, share price follows earnings per share (EPS). That makes EPS growth an attractive quality for any company. Over the last three years, Cathay General Bancorp has grown EPS by 17% per year. That's a good rate of growth, if it can be sustained. One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. I note that Cathay General Bancorp's revenue from operations was lower than its revenue in the last twelve months, so that could distort my analysis of its margins. While we note Cathay General Bancorp's EBIT margins were flat over the last year, revenue grew by a solid 12% to US$617m. That's progress. You can take a look at the company's revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers. NasdaqGS:CATY Income Statement, June 24th 2019 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 check this interactive chart depicting future EPS estimates, for Cathay General Bancorp ? Story continues Are Cathay General Bancorp Insiders Aligned With All Shareholders? 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. So it is good to see that Cathay General Bancorp insiders have a significant amount of capital invested in the stock. Notably, they have an enormous stake in the company, worth US$133m. 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. It's good to see that insiders are invested in the company, but are remuneration levels reasonable? A brief analysis of the CEO compensation suggests they are. I discovered that the median total compensation for the CEOs of companies like Cathay General Bancorp with market caps between US$2.0b and US$6.4b is about US$5.2m. The Cathay General Bancorp CEO received total compensation of just US$2.3m in the year to December 2018. That looks like modest pay to me, and may hint at a certain respect for the interests of shareholders. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. It can also be a sign of good governance, more generally. Should You Add Cathay General Bancorp To Your Watchlist? One positive for Cathay General Bancorp is that it is growing EPS. That's nice to see. The fact that EPS is growing is a genuine positive for Cathay General Bancorp, but the pretty picture gets better than that. With a meaningful level of insider ownership, and reasonable CEO pay, a reasonable mind might conclude that this is one stock worth watching. Of course, just because Cathay General Bancorp is growing does not mean it is undervalued. If you're wondering about the valuation, check out this gauge of its price-to-earnings ratio , as compared to its industry. Although Cathay General Bancorp 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 this free list 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 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. |
US National Cancer Institute approves blockchain project to create a shared data system
The National Cancer Institute, an agency within the U.S. Department of Health and Human Services, has approved a project to create a blockchain-based system to share clinical data.
The agencyapprovedthe project on Friday, stating that the Rensselaer Polytechnic Institute will use IBM Hyperledger blockchain to share clinical data between health care providers, patients and the research community.
Traditionally, clinical data has been stored across multiple parties and managed in a fragmented manner, creating "frictions in information exchange,” the agency said. They added:
“Failure in timely access to health information could impede effective treatment decision-making, which will adversely affect patient health, and also incur unnecessary costs such as duplicated tests.”
The blockchain-based system aims to “securely and efficiently” share healthcare data, maintaining flexibility as well as enforcing data sovereignty. |
Construction jobs see average pay soar as UK loses EU workers
Construction workers in the Victorian arches underneath the tracks at London Bridge station. Photo: Press Association Average wages in the construction industry have soared as the UK loses EU workers because of Brexit, according to a recruitment firm. Recruiters Randstrad said average pay in a sector survey had increased to £45,900 a year in 2018, a £3,600 rise in just 12 months. The figures are even higher for site managers and for jobs in London. The average site manager surveyed said they took home £50,500 a year outside the capital, and others reported a £3,000 London premium. Randstad said one senior site manager was earning £78,000 a year for a job in Welwyn Garden City, a huge leap on their previous £62,900 pay packet. The firm said the trend came amid falling advertised vacancies in the sector. Construction firms could be paying more because of a shortfall of workers caused by lower levels of EU migration to the UK. READ MORE: UK firms still paralysed by uncertainty three years after Brexit vote The figures may be welcomed by Brexit supporters concerned about the impact of migration on UK wages, but also suggest business leaders face a growing problem finding the staff they need. Owen Goodhead of Randstad said: “The best senior site managers are earning close to an MP’s salary. While that’s good news for individuals, it’s potentially not such great news for the economy. “Our research shows that construction workers from overseas are being put off coming to the UK and those that are here are thinking about moving elsewhere. “This should be of huge concern to industry leaders and the government, especially in the capital, where nearly one in three people working in London’s construction sector were born in the EU. “The shrinking pool of EU talent is already driving up wages – that’s the power of supply and demand. This builder Brexodus is the referendum’s inheritance.” READ MORE: EU says talks cannot be re-opened over Brexit withdrawa View comments |
'We're certainly not tracking on the Amazon model': Canopy Growth reports $323M Q4 loss
Canopy Growth Corp. (WEED.TO) blamed rising expenses for a wider-than-expected loss in its fiscal fourth-quarter results posted after the closing bell on Thursday.
Co-chief executive Bruce Linton is assuring investors that while the company is spending heavily to secure a dominant position in global cannabis, it won’t need to do so forever.
“We’re certainly not tracking on the Amazon model, but you see the value of investing when people transform their behaviours. We're at the front of that,” Linton told analysts on a conference call Friday morning, referring to the e-commerce giant’s reputation for big spending. “You've seen, I think, the bottom of our margin trough.”
The Smiths Falls, Ont.-based company reported a net loss of $323.4 million, or 98 cents a share, compared to a loss of $54.4 million in the same quarter last year. According to FactSet, analysts on average predicted losses of $95.2 million, or 25 cents a share.
Toronto-listed shares fell 6.87 per cent to $53.70 at 10:35 a.m. ET.
The loss was due in part to rising operating expenses, mainly from sales and marketing, increased compensation and acquisition-related costs. Sales and marketing expenses rose to $53.1 million, or 56 per cent of revenue, from $14.7 million in the prior period.
“As you build out from 600,000 square feet licensed in Canada to 4.8 million square feet over about a five quarter period, you end up with a lot of assets that are coming on stream but are not on stream. They carry burden that doesn't show up in benefit,” Linton said.
Adjusted gross margin fell to 16 per cent in the fourth quarter, from 22 per cent in the previous period.
“We believe we are on a path for reported gross margins to be above 40 per cent by the end of the fiscal year, and will increase further in the future with higher efficiencies and increased sales of value added products,” acting Chief Financial Officer Mike Lee said on the call.
He said investors should expect near-term costs associated with the company’s facility to produce infused beverages, which is set to be completed in mid-September.
Linton said he sees the Canadian roll-out of next-generation cannabis products like drinks, edibles, vapes and lotions as a financial turning point for Canopy Growth as it introduces its suite of higher-margin products. He said the company will have beverages and edibles in the market in time for the holidays in December.
Revenue climbed to $94.1 million in the quarter ended March 31, up from $83 million in the fiscal third quarter. Net of excise taxes, analysts expected the company to achieve revenue of $90.6 million in its fourth quarter.
Canopy Growth said it sold 9,326 kilograms or kilogram equivalents of cannabis in the fourth quarter. That’s up from 2,528 kilogram or kilogram equivalents sold in the same period last year.
The company reported $68.9 million in revenue from Canada's recreational market, down from $71.6 million from the prior quarter.
Meanwhile, Canopy Growth is working to boost its presence in the United States and other global markets.
Shareholders approved a deal to buy U.S. multi-state operator Acreage Holdings Inc. (ACRG-U.CN) on Wednesday. The deal hinges on cannabis becoming permissible to sell under U.S. federal law.
Last month, Canopy Growth said it would buy skincare company This Works for $73.8 million to add beauty and sleep products to its portfolio of cannabis, oil, hemp and medical capsules.
Lee said the company is exploring ways to accelerate acquisition integration by developing a “turn-key M&A playbook.” The comment comes as the company warned the Acreage acquisition could lead to a charge that would have a “materially negative impact on net income in the first quarter of fiscal 2020.”
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What Does Commercial Vehicle Group, Inc.'s (NASDAQ:CVGI) Balance Sheet Tell Us About It?
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Commercial Vehicle Group, Inc. (NASDAQ:CVGI) is a small-cap stock with a market capitalization of US$223m. 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? Evaluating financial health as part of your investment thesis is vital, 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, this is just a partial view of the stock, and I’d encourage you todig deeper yourself into CVGI here.
CVGI has sustained its debt level by about US$181m over the last 12 months including long-term debt. At this current level of debt, CVGI's cash and short-term investments stands at US$54m , ready to be used for running the business. Additionally, CVGI has produced US$55m in operating cash flow during the same period of time, resulting in an operating cash to total debt ratio of 30%, indicating that CVGI’s operating cash is sufficient to cover its debt.
At the current liabilities level of US$140m, the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.38x. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for Machinery companies, this is a reasonable ratio since there's a sufficient cash cushion without leaving too much capital idle or in low-earning investments.
With total debt exceeding equity, CVGI is considered a highly levered company. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. 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 CVGI's case, the ratio of 4.15x suggests that interest is appropriately covered, which means that lenders may be willing to lend out more funding as CVGI’s high interest coverage is seen as responsible and safe practice.
Although CVGI’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 CVGI'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 CVGI has company-specific issues impacting its capital structure decisions. You should continue to research Commercial Vehicle Group to get a better picture of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for CVGI’s future growth? Take a look at ourfree research report of analyst consensusfor CVGI’s outlook.
2. Valuation: What is CVGI 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 CVGI 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. |
Canadian personal wealth growth turned negative in 2018: study
Gains in global personal wealth slowed to the weakest in five years in 2018, according to a new analysis released on Thursday. Things were worse in Canada.
Anna Zakrzewski, global leader of Boston Consulting Group’s wealth-management practice, said wealth growth turned negative last year in Canada for the first time.
“Canada was actually negative one per cent,” she toldYahoo Finance Canada.
BCG found global wealth growth came to a sharp halt in 2018, rising just 1.6 per cent. The slowdown comes on the heels of a 7.5 per cent gain in personal global wealth in 2017, and a 6.2 per cent compound annual growth rate from 2013 to 2017.
When the impact of the rising U.S. dollar is factored in, that 1.6 per cent gain last year was effectively wiped out.
“For the first time since 2008, we saw wealth growth was negative when you take into account all the factors. North America as a whole was kind of a zero-sum game,” Zakrzewski said.
BCG blamed the fourth-quarter dip on major stock indexes for pulling down equities and the large portfolios tied to them. High valuation levels, geopolitical risks, and the challenges of returning to normal interest rate levels also contributed to the decline, the researchers found.
Zakrzewski said the North American preference for equities over fixed-income investments contributed to weaker wealth growth in the region. Canadians, she added, tend to keep a more conservative portfolio than their neighbours to the south.
“North America on average had 14 per cent in cash and deposits,” she said. “Canada was 22 per cent.”
BCG estimated the global pool of personal wealth is US$206 trillion.
The firm also took a snapshot of the world’s millionaires and found Switzerland has the most as a percentage of its adult population, followed by the U.S., Canada, Taiwan and Japan.
The global millionaire population was found to have jumped 2.1 per cent in 2018 to 22.1 million.
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Meet the company reaping the benefits of Amazon's popularity in Canada
PARIS, FRANCE - SEP 28, 2018: Small Amazon parcel cardboard box against yellow background smile logo. Amazon Prime is the online paid subscription service offered by Amazon.com web-commerce site. Amazon.com Inc. has become the leading e-commerce destination for Canadian consumers, according to a new RBC survey – and Cargojet Inc. is reaping the benefits. According to RBC’s Canadian E-Commerce Survey, conducted in late 2018 and released last week, Amazon was the top e-commerce destination for Canadian consumers, more than twice as popular than Walmart. “Amazon was the clear market leader, with 85 per cent of consumers indicating they had made a purchase on the website, and was 2.5 (times) more popular than the runner-up Walmart, which had a 32 per cent response rate,” the report said. According to the report, Amazon has quadrupled its same or one-day delivery reach since 2015, now reaching approximately two of every three households in Ontario, Quebec and British Columbia, 59 per cent of households in Alberta, and 44 per cent of households in Saskatchewan. Amazon Prime has been expanding its reach in Canada. Earlier this year, it announced that it would be launching its free, one-day delivery service that comes with a Prime membership to 13 additional Canadian cities, including Ancaster, Brantford, Hamilton, Kitchener, and Woodstock Ontario, as well as Quebec City, Que. and Victoria, B.C. The expansion of the one-day delivery service has been a key positive for Cargojet, RBC Capital Markets analyst Walter Spracklin wrote in a note to clients earlier this month. “The prior two-day delivery in many cases could be accommodated by truck,” Spracklin wrote. “However, at one-day, the need for air freight capacity is notably higher.” CargoJet, which provides time sensitive overnight air cargo services, saw its share of the air freight market grow from 50 per cent to 95 per cent in 2015 when it won the lucrative Canada Post contract away from Kelowna Flightcraft. Since then, it has been reaping the benefits of the growth of Amazon Prime in Canada. “We consider Cargojet to be uniquely positioned within the niche time-sensitive overnight cargo segment in Canada,” Spracklin wrote earlier this year. Story continues “The company controls (about) 95 per cent of the domestic overnight cargo business, benefits from long-term contracts with solid customers, and boasts (about) 75 per cent contracted volumes.” Cargojet does not report its e-commerce and business-to-business (B2B) results separately in its financial reports. But, RBC notes the company’s total volume grew 7 per cent in 2016, 14 per cent in 2017 and another 14 per cent in 2018 “entirely due to the rise of e-commerce.” RBC estimates that e-commerce represents about 25 per cent of Cargojet’s total volumes, with Amazon representing a majority of that figure. Cargojet’s stock has jumped 21 per cent since the start of the year. Since 2015, the stock is up more than 210 per cent. For Amazon and other e-commerce operators, there’s still room to grow. According to the RBC report, 55 per cent of respondents said that just 20 per cent of their total online purchases were made online. Yahoo Finance Canada Download the Yahoo Finance app, available for Apple and Android . |
5 Things You Can Expect From Canopy Growth in the Second Half of 2019
Canopy Growth(NYSE: CGC)disappointed investors with its fiscal 2019 fourth-quarter results announced last Thursday evening. Although the company's net revenue increased, there wereplenty of things to dislike. Canopy reported lower sales compared to the previous quarter for Canadian medical and recreational cannabis, as well as international medical cannabis.
Now that investors have had time to digest the Q4 results, the focus is now on what the future holds for Canopy Growth. The company's co-CEO, Bruce Linton, and its new acting CFO, Mike Lee, talked about what's on the horizon during Canopy's quarterly conference call Friday morning. Here are five things you can expect from Canopy Growth in the second half of 2019 -- and two things that you shouldn't.
Image source: Getty Images.
Lee perhaps said it best in his statement that Canopy is "building capacity in Canada, the U.S., and beyond." In the near term, it's the capacity expansion in Canada that will make the biggest difference for the company.
Canopy expects that it will harvest around 34,000 kilograms of cannabis in its fiscal 2020 first quarter, which ends on June 30, 2019. That's more than double the capacity the company had in Q4. Lee said that this higher level is "the beginning of a new normal" for Canopy. This added capacity should boost the company's sales as more retail stores open in Canada.
Although Canopy's gross margin declined in Q4 compared to the previous quarter, you can look for margins to improve in the second half of calendar year 2019. Lee said that the company is on track to deliver a gross margin of at least 40% by the end of its fiscal year, which ends on March 31, 2020.
The key to achieving this improvement ties into Canopy's capacity expansion. In the fourth quarter, underutilization at several large greenhouses hurt its gross margin. As renovations are completed, though, the company will generate higher revenue while its fixed costs remain relatively steady.
Canopy Growth's Canadian medical cannabis revenue in Q4 fell 41% from the previous quarter. Linton expressed confidence that the company's Canadian medical cannabis sales would rebound in the coming quarters, though.
One key reason behind Canopy's slumping medical cannabis revenue was its transition of brands, including Tweed, from focusing on the medical market to instead focus on the recreational market. But Linton said that Canopy's Spectrum medical cannabis brand is picking up sales momentum. In addition, he thinks that the company's clinical trials could produce positive results that enable it to attract more medical cannabis patients in the future.
Look for Canopy's international sales to bounce back as well after slipping in the fourth quarter. Supply constraints primarily caused this decline. But Canopy expects its Denmark facility to come on line soon, which should enable the company to export more to the big German medical cannabis market.
Canopy should also begin to generate revenue in the U.S. hemp cannabidiol (CBD) market by the end of 2019. Linton indicated that the company could launch CBD-infused skincare products and perhaps even beverages in New York state, although he didn't provide details on which types of products would be on the market this year.
Speaking of beverages, Linton said that Canopy Growth is gearing up to launch cannabis-infused beverages, chocolates, and vapes later this year. He predicts that Canopy will be the global leader in these new product categories.
Linton stated that "probably half" of Canada's 10 provinces will be in a position to quickly launch a full range of products. However, he noted that sales could be limited this year. Companies must wait 60 days after notifying Health Canada about new cannabis products before they can market those products. That translates to a mid-December launch for Canopy. With the Christmas and Hanukkah holidays in December, the company will likely have a very limited shipping window in 2019.
Don't expect Canopy Growth to report profits anytime soon. Linton and Lee were clear that the company would continue to invest significantly and wasn't focused on near-term profitability. However, Lee said that Canopy will be on track to deliver positiveEBITDAin fiscal year 2021 -- at least for its Canadian operations.
Also, you shouldn't get your hopes up that Canopy will be able to pull the trigger onits deal to buy U.S.-based cannabis operatorAcreage Holdingsthis year. Shareholders of both companies have approved the acquisition, but Canopy must wait until U.S. federal marijuana laws are revised.
Linton was asked about the potential impact of last week's U.S. House of Representatives vote to prevent the Department of Justice from interfering in states that have legalized marijuana. He indicated that Canopy was closely following the progress of this legislation. However, he added that the bill doesn't make marijuana federally permissible but instead could make anti-marijuana laws "federally unenforceable."
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Cybersecurity Risks Are Threatening Deals, Industry Survey Shows
(Bloomberg) -- Cybersecurity issues are increasingly becoming a concern in mergers and acquisitions, a new survey shows, and lapses can jeopardize deals or haunt purchasers long after the deal is done.
Of more than 2,700 information technology and business decision makers surveyed by Forescout Technologies Inc. in seven countries, 53% reported that their organization had encountered a critical cybersecurity issue or incident that put an M&A deal in jeopardy. And 65% of respondents said they had experienced buyers’ remorse because of cybersecurity concerns after closing a deal.
The findings, released Monday, show that taking the time to conduct cybersecurity evaluations is important before and during an acquisition, even if it means finalizing the deal gets delayed, said Julie Cullivan, chief technology and people officer at Forescout. The company sells a security platform that allows companies to monitor and control access to their networks.
“Cybersecurity is a challenge for every organization, and risk factors are changing all the time,” Cullivan said. “It’s about making sure you put as much energy into it up front.”
Recent acquisitions highlight the threat that cyber risks can pose to a company’s reputation and bottom line.
Verizon Communications Inc. acquired Yahoo’s Internet properties in 2017 at a $350 million discount after security breaches surfaced at the web company. And Marriott International Inc. inherited a massive security risk when it bought Starwood, including a breach that was disclosed just days after the deal was announced.
Yahoo and Starwood aren’t isolated incidents. Earlier this month, Asco Industries, which Spirit AeroSystems Holdings Inc. agreed to buy in May 2018, was hit by a large-scale ransomware attack. The attacked cause a “serious” disruption of Asco’s activities and its sites in Belgium, Canada, Germany and the U.S. were stopped.
Spirit AeroSystems won EU approval for the deal in March, but the acquisition has yet to be completed.
Thorough cybersecurity assessments that include utilizing third-party audits can often help avoid these types of issues, said Joe Cardamone, senior information security analyst and North America privacy officer for Haworth Inc., a designer and manufacturer of office furnishing products in Holland, Michigan.
“It’s not an intangible risk. It’s a very tangible thing and true money that can be lost,” said Cardamone, who has been involved in Haworth’s acquisition of at least six companies. “Treat it like you are buying a used car. I’d still want to look underneath the hood.”
Haworth, which is a Forescout customer, revamped its acquisition policy about five years ago to include information security.
--With assistance from Joshua Fineman.
To contact the reporter on this story: Derek Hall in Chicago at dhall129@bloomberg.net
To contact the editors responsible for this story: Catherine Larkin at clarkin4@bloomberg.net, Jeran Wittenstein
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Higher gas prices help Canadian retail sales edge up in April
Canadian retail sales growth edged up 0.1 per cent to $51.5 billion in April, largely due to higher gas prices and a jump in food and drink sales.
According to Statistics Canada, a 1.2 per cent boost in sales at gas stations was the main contributor to April’s slight increase. Sales at food and beverage stores increased 0.4 per cent, while receipts at miscellaneous retailers (which includes pet and cannabis stores) increased 2.8 per cent in the month.
Overall, sales were up in seven of 11 subsectors which represent 74 per cent of the retail landscape.
But taking out price increases, TD economist Omar Abdelrahman said in a note that “the picture was still disappointing.”
“The Canadian consumer spending picture stands in contrast with employment growth and a job market that has been firing on all cylinders,” Abdelrahman wrote.
“Part of this is likely due to past interest rate increases still working their way into the system, and indebted households remaining cautious.”
Economists also say that the less-than-stellar early spring weather has likely kept shoppers at home.
“A later than normal arrival of spring weather appears to have contributed to retail sales looking soft in April,” CIBC economist Royce Mendes wrote in a note Friday.
“However, the weakness was relatively concentrated during the month, and could prove somewhat transitory given that temperatures have finally risen.”
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How to myth-bust your way to lower car insurance rates
There are a lot of myths when it comes to car insurance, so separating fact from fiction can help bring down premiums.
For example, a new survey shows 1 in 5 Canadians said they believe the colour of their car impacts their insurance rate, which is not true.
“This particular myth is based on the stereotype of a fancy car – a Lamborghini or Ferrari is often red,” Matt Hands, senior business unit manager of insurance atRatehub.ca, toldYahoo Finance Canada.
“Insurance rates are often higher for a sports car because it’s more expensive and perceived to be a higher risk (i.e. propensity of speeding & reckless driving), but not because of its colour.”
Almost half (46 per cent) said they believe gender doesn’t affect rates, which is false because insurers have used historical data to determine male drivers are riskier.
More than 40 per cent think it doesn’t matter how often they drive, which is also false.
“According to insurers, the more time drivers spend on the road, the more likely they are to get into accidents,” said Hands.
Postal codes have an impact on premiums but 39 per cent don’t believe it. Densely populated areas typically mean higher rates because accidents and vandalism become more likely. For a number of reasons,B.C. drivers currently pay Canada’s highest premiums.
Contrary to what 36 per cent of respondents believe, parking tickets have no impact on insurance rates.
How to pay less for car insurance
A lot of factors that influence insurance premiums are out of our control. Insurance companies consider many different things when calculating rates.
“This includes things like your vehicle’s make, model and year, driving history and where you live,” said Hands.
“With this information, they can determine the likelihood of a claim and the potential costs associated with that claim.”
There are some things you can do to get the best rate possible. Hands suggest shopping around and asking about discounts, as well as bundling with other insurance like home insurance. Hands also suggest increasing your deductible.
“This is the amount you have to pay out of pocket when you make a claim,” said Hands.
“Typically, the higher the deductible, the lower the car insurance premium.”
The value of a vehicle is a deciding factor but a vehicle’s make and model can also sway rates.
“If you were thinking of buying either a 2019 Toyota Camry or 2019 BMW 3 series, it would be cheaper to insure the Camry because typically the cost to replace or repair a Toyota is cheaper than the BMW (i.e. the parts for a BMW 3 series are more expensive than the parts for a Toyota Camry),” said Hands.
“Furthermore the more technology within a car the more it will cost to repair or replace and therefore an insurer will increase the rates they offer accordingly.”
Hands says safety ratings and crash statistics can also have an impact.
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Latest Bitcoin price and analysis (BTC to USD)
Last week, when I wrote my usual Monday BTC price analysis, Bitcoin was trading close to $9,200. At the time of writing, Bitcoin (BTC) is trading just below $11,000 after price climbed 16% from $9,200 to $11,070 in just a couple of days. It seems the hypothesis that weekends are good for Bitcoin is indeed true, as BTC consolidated above the key $11,000 level during Saturday and Sunday before a dip going into Monday morning. My gut tells me this is what we’ve all been waiting for. Will Bitcoin maintain its weekend gains during the next few weeks? Has the bull market officially begun? Bitcoin/USD Bitcoin has experienced a major rally that has taken its price upwards close to 34% over the past two weeks. Even with minor retracements, the market is moving positively with higher lows each time it falls, meaning we should expect BTC to continue its climb towards $13,000 – which in my opinion might come within the next couple of weeks. Last week, I mentioned how I was expecting BTC to break and hold above $10,000, which has come to fruition. While I personally am still bullish, others are predicting a sudden correction. Prominent Bitcoin trader davincij15 has claimed all bull markets are expected to suffer large corrections of around 30-35% of the total highs in the early stages. This means we could still see Bitcoin touching its 100-day EMA or even its 200-day EMA despite the bull cycle (which can last a couple of years). We’ve seen similar movements during previous cycles in 2013 and 2016-2017. Let’s not forget that I consider Bitcoin to be in a bull run when the 20-day EMA is above the 50-day EMA and the latter is above the 200-day EMA. As we’ve already accomplished that goal, I personally think the bears have retreated and bulls are now firmly in charge. Corrections are expected and welcomed so that we can accumulate even during bull seasons. Volume also seems to be increasing as well. Over the past two weeks, volume has gone from $17 billion to $23 billion, consolidating now around $20 billion. Story continues Putting all this information together, we’re now clearly on the right path to reach $15,000 – or maybe even $20,000 – by the end of 2019. Of course, if you think I might be overreacting to positive news, you can always check what other expert analysts have to say about this recent price movement. Hopefully, the market will continue this positive momentum. Pay attention to retracements back down towards the 200-day EMA to make new entries. Safe trades! Current live Bitcoin pricing information and interactive charts are available on our site 24 hours a day. The ticker bar at the bottom of every page on our site has the latest Bitcoin price. Pricing is also available in a range of different currency equivalents: US Dollar – BTCtoUSD British Pound Sterling – BTCtoGBP Japanese Yen – BTCtoJPY Euro – BTCtoEUR Australian Dollar – BTCtoAUD Russian Rouble – BTCtoRUB About Bitcoin In August 2008, the domain name bitcoin.org was registered. On 31st October 2008, a paper was published called “Bitcoin: A Peer-to-Peer Electronic Cash System”. This was authored by Satoshi Nakamoto, the inventor of Bitcoin. To date, no one knows who this person, or people, are. The paper outlined a method of using a P2P network for electronic transactions without “relying on trust”. On 3rd January 2009, the Bitcoin network came into existence. Nakamoto mined block number “0” (or the “genesis block”), which had a reward of 50 Bitcoins. More Bitcoin news and information If you want to find out more information about Bitcoin or cryptocurrencies in general, then use the search box at the top of this page. Here’s an article to get you started. As with any investment, it pays to do some homework before you part with your money. The prices of cryptocurrencies are volatile and go up and down quickly. This page is not recommending a particular currency or whether you should invest or not. *The views and opinions expressed by the author should not be considered financial advisement. The author is not a professional trader, nor investor. The post Latest Bitcoin price and analysis (BTC to USD) appeared first on Coin Rivet . |
Is your bank paying you enough interest on savings and CDs? Here's how to find out
Ian Pareja, a test engineer in California, says he “got super excited and went down a rabbit hole” when he learned about the higher rates that some savings accounts now offer.
“Originally, when I was banking with Chase, they would only give me less than 0.1%,” Pareja says. “I found out that's normal. A lot of Americans are losing out on free money.”
After undertaking research on savings account rates, Pareja found a new savings account at an online bank that offered a rate of about 2.2%, which meant his money could earn more than 20 times what it earned in his old account. He quickly switched to the online bank and says he’s using the savings account for his long-term goals, including saving for a house.
“People see a number, whether 0.1% or 2%, it seems insignificant to them, but if you have $10,000 in your savings account and you don’t need it immediately, you can generate $200 or $300 versus, like, $10,” he says.
Pareja has the right idea about how to approach savings accounts, experts say. Most Americans may not give a second thought to these accounts, but more than 1 in 4 now offer over 2% interest and no minimum deposit, balance requirement or monthly fee, according to a recent survey from Bankrate.com.
Despite this, only 14% of Americans earn more than 2% in their savings accounts, the study found.
“About a quarter of people with savings aren't earning any interest at all,” notes Greg McBride, chief financial analyst for Bankrate.com. “There are a lot of potential interest earnings that people are leaving on the table.”
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That’s problematic because those bank customers aren’t keeping up with inflation, which stands at about 2%. McBride says tapping higher-interest savings accounts can help protect the buying power of your money.
Certificates of deposit – known as CDs – can offer rates of 3% or higher, although they have more restrictions than savings accounts. Typically, both savings accounts and CDs offer higher rates than checking accounts. Savers can search for rates at sites like Bankrate.com and Nerdwallet, which allow you to screen by interest rates.
Not sure where to start? Here are 3 tips from experts:
Determine what you’re saving for – including a realistic assessment of when you’ll need the money, says Arielle O’Shea, investing editor at NerdWallet. For some people, a CD might be a good choice if they know they’ll need their money at a specific point in the future, but not before.
That’s because CDs lock up your money for a specific time, typically between several months to five years, in exchange for a guaranteed rate. The longer the lockup, the higher the rate.
Some longer-term CDs offer higher rates than either savings or checking accounts, with several five-year CDs offering more than 3%.
“CDs are great if you have a specific goal in mind, but you will pay an interest penalty if you have to withdraw early,” O’Shea notes. The penalty can amount to months of interest, depending on how early you withdraw the money.
If you aren’t sure of your time frame, a savings account may be the better option, she adds.
Some customers may not be aware they can link a new savings account to their current bank, even if the new account is at a different institution, says Bankrate.com’s McBride.
“All you are going to do is move your money to a better-yielding account,” he notes.
For some, easy access to their savings account may be too tempting – in which case, consider keeping your higher-interest savings account separate from your main checking account, experts say.
Research the fine print when it comes to penalties and fees, such as the early withdrawal penalties for CDs.
It’s also important to understand how you can access your savings account. For instance, some accounts allow you to withdraw funds through an ATM, while others won’t. And by federal law, you are limited to six withdrawals or transfers per statement cycle, which means a savings account might not be for everyone.
Some accounts also carry fees, so keep your eyes open for those gotchas. Last, make sure you’re comfortable with the bank and that it’s FDIC insured, says Bankrate.com’s McBride.
“If you find that you're not comfortable with a particular bank – they won't pick up the phone or their site is difficult to navigate – move to the next one,” he says.
This article originally appeared on USA TODAY:Is your bank paying you enough interest on savings and CDs? Here's how to find out |
Is Antibe Therapeutics Inc.'s (CVE:ATE) CEO Overpaid Relative To Its Peers?
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Dan Legault has been the CEO of Antibe Therapeutics Inc. (CVE:ATE) since 2009. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This method should give us information to assess how appropriately the company pays the CEO.
Check out our latest analysis for Antibe Therapeutics
According to our data, Antibe Therapeutics Inc. has a market capitalization of CA$80m, and pays its CEO total annual compensation worth CA$273k. (This is based on the year to March 2018). Notably, the salary of CA$273k is the vast majority of the CEO compensation. We examined a group of similar sized companies, with market capitalizations of below CA$264m. The median CEO total compensation in that group is CA$152k.
It would therefore appear that Antibe Therapeutics Inc. pays Dan Legault more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. A closer look at the performance of the underlying business will give us a better idea about whether the pay is particularly generous.
You can see, below, how CEO compensation at Antibe Therapeutics has changed over time.
Over the last three years Antibe Therapeutics Inc. has grown its earnings per share (EPS) by an average of 2.9% per year (using a line of best fit). In the last year, its revenue is up 8.6%.
I would argue that the improvement in revenue isn't particularly impressive, but I'm happy with the modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Boasting a total shareholder return of 141% over three years, Antibe Therapeutics Inc. has done well by shareholders. 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.
We compared total CEO remuneration at Antibe Therapeutics Inc. with the amount paid at companies with a similar market capitalization. We found that it pays well over the median amount paid in the benchmark group.
While we generally prefer to see stronger EPS growth, there's no arguing with the strong returns to shareholders, over the last three years. Considering this fine result for investors, we daresay the CEO compensation might be apt. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Antibe Therapeutics (free visualization of insider trades).
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. |
Filling Iran oil gap in India: U.S. supplies outshine Middle East crude
By Nidhi Verma
NEW DELHI (Reuters) - A surge in India's oil imports from the United States outpaced growth in shipments from its traditional suppliers in the Middle East, after Washington imposed sanctions on Tehran in November, according to tanker arrival data obtained from sources.
U.S. President Donald Trump's administration renewed sanctions against Iran last year over its nuclear programme, although some buyers were allowed to continue taking limited volumes of Iranian oil under a six-month waiver.
In May, the United States ended those exemptions and said countries that continued to buy Iranian oil would face sanctions, but India buyers had already begun shifting some of their sourcing away from the Middle East.
India, the world's third-biggest oil importer, bought about 184,000 barrels per day (bpd) oil from the United States over November 2018 to May 2019, compared with about 40,000 bpd in the same period a year earlier, the tanker data obtained from shipping and industry sources showed.
Over this same period, India, which through May was Iran's second-biggest oil client after China, took 48% less oil from Tehran at about 275,000 bpd, the data showed.
Graphic: India crude oil imports from top suppliers since Iran sanctions took effect https://fingfx.thomsonreuters.com/gfx/ce/7/5073/5059/IndiaCrudeImportssinceIranSanctions.png
U.S. Secretary of State Mike Pompeo, who will be in New Delhi on Tuesday, earlier this month said India should boost oil and gas purchases from Washington to cut reliance on difficult regimes like those found in Venezuela and in Iran.
A previous round of sanctions against Iran - that began in early 2012 and ended in 2016 - allowed Saudi Arabia and Iraq to raise their Asian market share. India also raised the volumes it took from Venezuela in that period to fill the Iranian oil gap.
But market dynamics have changed, with the United States becoming the world's top oil producer.
Graphic - India: Filling the Iranian oil void interactive https://fingfx.thomsonreuters.com/gfx/editorcharts/INDIA-OIL/0H001PBQR5XG/index.html
"Venezuela's oil output is now declining. Saudi grades are costly, and Iraq has limited capacity to sell extra oil. So Indian refiners can't escape from U.S. oil," said Sri Paravaikkarasu, director for Asia oil at energy consultancy FGE.
She said the higher official selling prices (OSPs) of Middle Eastern grades and rising spot premium are also pushing India to buy more U.S. oil.
India's intake of Saudi oil during the seven months to May rose by 11% to 804,000 bpd, while that from the United Arab Emirates jumped by 37% to about 360,000 bpd, the data showed.
Imports from Iraq declined 3.3% to 1.01 million bpd, the data also showed.
In contrast, crude imports from the United States have more than quadrupled.
Ahead of the tougher U.S. sanctions this year, Indian refiners had rejigged their annual deals to buy more oil from some suppliers, including Mexico, and signed new contracts with the United States.
Also, over the last few years, Indian refiners have installed secondary units to be able to process cheaper, lower-quality crude grades.
"Indians can blend heavy sour grades from Mexico with sweet oil from the U.S. and other sources to get medium sour crude similar to the Middle Eastern crude," said Ehsan Ul-Haq, lead analyst for Oil Research and Forecasts at Refinitiv.
India's oil imports from Mexico rose by about 13% in the November 2018-May 2019 period from a year earlier to 268,000 bpd, the data showed.
"U.S. crude is available at a deep discount to Brent, very often even to Dubai and Oman. There is a scope that Indians will buy more U.S. crude because it will remain at a discount to Brent," Haq said.
West Texas Intermediate crude futures are running at around $7 to $8 a barrel cheaper than international benchmark Brent futures.
(Reporting by Nidhi Verma; Editing by Tom Hogue) |
3 Energy Dividends You Shouldn't Overlook
Owning dividend stocks can be one of the best ways to beat the market and generate a little income along the way. And energy stocks have long been an investor favorite for dividends.
But the last few years have shown more volatility in energy dividends than investors might want. Oil price volatility has affected everyone from oil drillers to marketers. Even utilities havefallen as far as going bankrupt. With these risks in mind,NextEra EnergyPartners(NYSE: NEP),Xcel Energy(NASDAQ: XEL), andHannon Armstrong(NYSE: HASI)have solid dividends in the energy industry today.
Image source: Getty Images.
Yieldcos -- companies that own assets with high levels of deprecation, resulting in non-operating losses but generate cash for dividends -- have gone in and out of favor for investors, but NextEra Energy Partners has stood the test of time. The company is a subsidiary ofNextEra Energy(NYSE: NEE), one of the biggest utility companies in the country. This gives the company a stability few yieldcos have had before it.
NextEra Energy's involvement gives NextEra Energy Partners 21 gigawatts (GW) of backlogged renewable energy projects that can be sold -- or dropped down in industry parlance -- to the yieldco. To buy those assets, though, Next Era Energy Partners needs to use either debt or equity to fund these dropdowns. As long as the yieldco has a relatively low dividend, currently at a 4.1% yield, and a low cost of debt, it can keep buying dropdown assets at a relatively low cost of capital to drive growth.
As it stands today, NextEra Energy Partners has 5.3 GW of assets in the portfolio with an average of 17 years remaining in contracts to sell electricity to utilities. Because of the treatment of dividends as a return of capital to investors, at least the next eight years of dividends will also be tax-free. And with projects already in the portfolio and visibility of future dropdowns, management says it expects 12% to 15% dividend growth through 2023.
The utility business has been more unpredictable than most investors expected as rooftop solar eats into demand, and cheap natural gas challenges the economics of aging fossil fuel plants. Xcel Energy has the advantage of operating primarily in states where residential solar doesn't have much market share (Minnesota, Wisconsin, and Colorado) and demand has steadily grown.
Xcel has also been able to leverage the renewable energy assets in its territory to grow, while not running afoul of more renewable energy regulation. The company operates utilities with one of the largest concentrations of wind power in the country, expected to be 11.3 GW by 2021. Owning those renewable energy assets gets the utility out in front of regulation or customers preferring renewable energy (I buy 100% wind power from Xcel Energy). When combined with steady consumption growth in its areas of operation, the utility has the steady growth you see below.
XEL Revenue (TTM)data byYCharts.
Xcel doesn't have the biggest dividend, trading at a 2.7% yield right now. But the stability of its utility business along with its growing renewable energy portfolio makes it a great dividend stock to own long term.
Hannon Armstrong is lumped in with traditional yieldcos, but it's a different beast altogether. The company says it provides financing for infrastructure projects that "reduce carbon emissions and increase resilience to climate change." That can include anything from alarge wind farm to an energy efficiency upgradefor a corporate partner.
It doesn't usually invest directly in renewable energy projects, instead buying underlying assets that present lower risks. For example, 22% of its $1.9 billion portfolio consists of land under solar projects, 17% is preferred equity in wind projects, and 31% are energy projects with government agencies. These asset classes each present a much lower risk than owning equity in a project, as yieldcos and utilities do.
Hannon Armstrong'sdividend yield of 5% right nowis a solid payback for a company presenting relatively low risk for investors. The company has shown a history of prudent investments, and it's providing a growing amount of financing that allows more sustainable projects to be built.
NextEra Energy Partners, Xcel Energy, and Hannon Armstrong all have their own strengths in energy, but one commonality is that they have predictable revenue streams years into the future. I think that's important in an era when oil and gas prices can rise and fall sharply based on the news of the day. For the foreseeable future, these dividends are as rock solid as it gets in the energy industry.
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Travis Hoiumowns shares of NextEra Energy Partners. The Motley Fool recommends NextEra Energy. The Motley Fool has adisclosure policy. |
Is Huntsman Corporation's (NYSE:HUN) Balance Sheet A Threat To Its Future?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Stocks with market capitalization between $2B and $10B, such as Huntsman Corporation ( NYSE:HUN ) with a size of US$4.6b, do not attract as much attention from the investing community as do the small-caps and large-caps. However, generally ignored mid-caps have historically delivered better risk adjusted returns than both of those groups. HUN’s financial liquidity and debt position will be analysed in this article, to get an idea of whether the company can fund opportunities for strategic growth and maintain strength through economic downturns. Note that this information is centred entirely on financial health and is a top-level understanding, so I encourage you to look further into HUN here . View our latest analysis for Huntsman Does HUN Produce Much Cash Relative To Its Debt? HUN's debt levels surged from US$2.3b to US$3.1b over the last 12 months , which includes long-term debt. With this increase in debt, HUN currently has US$444m remaining in cash and short-term investments , ready to be used for running the business. Additionally, HUN has produced cash from operations of US$775m during the same period of time, resulting in an operating cash to total debt ratio of 25%, meaning that HUN’s current level of operating cash is high enough to cover debt. Does HUN’s liquid assets cover its short-term commitments? Looking at HUN’s US$1.7b in current liabilities, it appears that the company has been able to meet these obligations given the level of current assets of US$3.1b, with a current ratio of 1.83x. The current ratio is calculated by dividing current assets by current liabilities. Usually, for Chemicals companies, this is a suitable ratio since there's a sufficient cash cushion without leaving too much capital idle or in low-earning investments. NYSE:HUN Historical Debt, June 24th 2019 Can HUN service its debt comfortably? With a debt-to-equity ratio of 91%, HUN can be considered as an above-average leveraged company. This is not unusual for mid-caps as debt tends to be a cheaper and faster source of funding for some businesses. 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 after interest and tax at least three times its net interest payments is considered financially sound. In HUN's case, the ratio of 7.5x suggests that interest is appropriately covered, which means that debtors may be willing to loan the company more money, giving HUN ample headroom to grow its debt facilities. Story continues Next Steps: Although HUN’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 HUN's liquidity needs, this may be its optimal capital structure for the time being. Keep in mind I haven't considered other factors such as how HUN has been performing in the past. You should continue to research Huntsman to get a more holistic view of the mid-cap by looking at: Future Outlook : What are well-informed industry analysts predicting for HUN’s future growth? Take a look at our free research report of analyst consensus for HUN’s outlook. Valuation : What is HUN 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 HUN 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. |
Jury convicts Illinois man of Chinese graduate student's kidnap-murder
By Bob Chiarito PEORIA, Ill. (Reuters) - An Illinois man who prosecutors described as obsessed with serial killers was found guilty on Monday of the kidnapping and decapitation murder of a Chinese graduate student two years ago and could now face the death penalty. A U.S. District Court jury in Peoria deliberated for less than two hours before convicting Brendt Christensen, 29, of all charges in the disappearance and death of Yingying Zhang, a 26-year-old student at the University of Illinois at Urbana-Champaign. Zhang was reported missing on June 9, 2017, two months after coming from southeastern China to study photosynthesis and crop production at the university. Her remains have never been found, but prosecutors said her DNA was matched to blood later found in three spots inside Christensen's bedroom. The case has been closely watched by Chinese media, Chinese government officials and Chinese students studying in the United States. Relatives publicly appealed to U.S. President Donald Trump for additional resources to help find Zhang two months after she vanished. Federal prosecutors trying Christensen under U.S. kidnapping laws have said they planned to seek the death penalty if he was found guilty. Investigators were led to Christensen through surveillance video footage captured in Urbana, 130 miles (210 km) south of Chicago, showing Zhang getting into a black car that later was traced to the defendant. Prosecutors said Christensen took Zhang to his apartment, where she fought for her life as he bludgeoned her with a baseball bat, raped her and stabbed her in the neck before cutting off her head. Details of the crime, including the decapitation, were revealed by Christensen himself in conversations with his then-girlfriend secretly recorded for FBI agents investigating the case before his arrest, according to trial testimony. FATHER'S STATEMENT OF THANKS Defense lawyers conceded during the trial that their client had killed Zhang, though they disputed particulars in prosecutors' account of events. Story continues During closing arguments on Monday, Assistant U.S. Attorney Eugene Miller told jurors that Christensen had spent up to six months planning the murder and had chosen Zhang because she was small of stature and appeared an easy target. "He raped her, he murdered her, and then spent the next three weeks trying to cover up the crime," Miller said. In their own summation on Monday, Christensen's lawyers suggested they hoped to persuade the jury to spare his life during the penalty phase of the trial, which was set to begin July 8. "This is not the ultimate decision. You have to realize there's more," attorney Elisabeth Pollock told jurors. Christensen, a onetime master's student at the university, sat expressionless in court as he was pronounced guilty on the charge of kidnapping resulting in death, as well as two counts of lying to federal investigators, capping an eight-day trial. Earlier in the trial, prosecutors characterized Christensen as having a fascination with serial killers, including Ted Bundy, who murdered dozens of women during the 1970s. The victim's father, Ronggao Zhang, read a statement outside the courthouse on Monday on behalf of the family thanking the jury for "this step towards justice." "We have missed Yingying tremendously in the past two years," he said. "As of today, we still could not imagine how we could live the rest of our lives without her." (Reporting by Bob Chiarito; Additional reporting by Gabriella Borter in New York; Writing by Steve Gorman; Editing by Frank McGurty, Lisa Shumaker and Leslie Adler) |
The 10 Most Important Numbers in Canopy Growth's Fourth-Quarter Report
The most prized earnings report throughout the marijuana industry is now in the books. Following the closing bell on Thursday, June 20,Canopy Growth(NYSE: CGC), the largest marijuana stock in the world by market cap, lifted the hood on its fourth-quarter and full-year operating results.
While the headline figures honed in on the company's near-tripling in year-over-year net sales growth and the expected 34,000 kilos of harvested capacity for the first fiscal quarter of 2020 (the April 1 through June 30 quarter), there were plenty of details sprinkled throughout Canopy's quarterly report that proved far more noteworthy. Here are the 10 most important figures in Canopy Growth's fourth-quarter report.
Image source: Getty Images.
Arguably one of the most pleasant surprises in Canopy Growth's quarterly results was the fact that the company's net sales (i.e., gross sales minus excise taxes) rose by a healthy 13.4% from the sequential third quarter. This is considerably higher than Wall Street was projecting, with the consensus figure having called for sequential growth of closer to 3% or 4%.
What's particularly noteworthy about this increase in sales is thatit wasn't cannabis revenue that led to the increase. Gross recreational revenue actuallydeclinedfrom the sequential quarter (all figures in Canadian dollars) from CA$71.6 million to CA$68.9 million, while medical marijuana gross revenue dipped from CA$18.6 million to CA$13.4 million in the fourth quarter. As you'll see in a few points, it was ancillary revenue, not cannabis sales, that led to this sequential sales growth.
Another figure that bears a lot of importance for Canopy Growth and its investors is just how much of its cannabis sales are coming from the adult-use market and the medical marijuana market. Generally speaking, the recreational market is much larger than the medical market in terms of consumers, but medical cannabis patients typically use pot products more frequently, buy more often, and are far more willing to purchase higher-margin derivative products (i.e., oils).
In the third quarter, there was anearly 80%-20% splitbetween recreational revenue and medical cannabis revenue for Canopy Growth. That pendulum swung even more noticeably toward the adult-use side of the equation in the fiscal fourth quarter, with 84% of the company's gross cannabis sales coming from the recreational market and just 16% from medical sales. This is somewhat to be expected as the ease of access to marijuana encourages medical patients to skip a doctor's visit and go straight to a dispensary for their product.
Image source: Getty Images.
Chalk this up as another surprise: The average selling price per gram of cannabis products (dried flower and derivatives, both domestic and international) actually rose by 2.2% from the sequential third quarter (CA$7.49 vs. CA$7.33). Until recently, the price per gram of cannabis products had fallen as a result of incorporating excise taxes paid to the Canadian federal government into the calculation.
However, simple supply-and-demand economics would suggest that this modest increase in the per-gram price of cannabis products isn't a surprise. In fact, the shortage of marijuana products throughout many Canadian provinces should push prices higher as long as demand exists. Even though pot stocks like Canopy Growth are underutilizing their capacity at the moment, Canopy is at least seeing a slightly higher average per gram price for the weed products it's selling.
On the other hand, international sales have to be a continued major disappointment for marijuana stock investors far and wide. Although the long-term outlook for the overseas pot industry remains bright, Canopy managed just CA$1.8 million in international marijuana revenue, down from CA$2.7 million in the sequential third quarter and 25% less than CA$2.4 million in overseas sales the company logged in the fourth quarter of 2018.
Canopy Growth primarily blamed supply chain issues in Canada for bogging down its international sales in the most recent quarter. The key takeaway here looks to be that until Canadian domestic demand is satiated,overseas sales could disappoint.
Image source: Getty Images.
BothAurora Cannabis(NYSE: ACB)and Canopy Growth arein a league of their ownwhen it comes to peak annual output. Aurora has 15 production facilities that should be cranking out an annual run rate of 625,000 kilos by the midpoint of 2020. Additional expansion could easily put Aurora on track for 700,000 kilos a year. Only Canopy Growth, with its 5.6 million square feet of devoted production space, can come close to rivaling Aurora Cannabis' commanding production potential.
The big question, entering this earnings report, is just how much of its 5.6 million square feet would be licensed. With more than 4.3 million square feet licensed as of its third-quarter results, we learned that Canopy has now upped its licensed capacity to north of 4.7 million square feet. While many of its peers have struggled to gain licensing approval for their core projects, Canopy Growth looks poised to gobble up market share in its home market of Canada.
As promised earlier, the star of Canopy Growth's report wasn't marijuana growth, because organic sales actually declined from the sequential quarter, but rather the CA$24.2 million in "other" revenue that the company reported, up from just CA$7.5 million in the sequential third quarter.
According to the company's earnings press release, this ancillary revenue derives from its acquisition of vaporizer company Storz & Bickel during the fiscal third quarter. Sales of these vaporizer products, along with extraction services, and clinic partnerships, resulted in a significant surge in non-direct cannabis revenue in the fiscal fourth quarter. In other words, it was acquisition-based growth, not organic growth, leading Canopy's sales higher in Q4 2019.
Image source: Getty Images.
Theoperating loss figurethat everyone, including yours truly, was looking for, actually came in worse than pretty much anyone had expected. For the fiscal fourth quarter, Canopy lost CA$174.5 million on an operating basis, which includes CA$242.9 million in operating expenses. Sales and marketing expenses, along with general and administrative costs, combined to total almost CA$119 million by themselves.
But here's the thing: This CA$174.5 million operating loss also includes a pretty sizable gain from fair-value adjustments on biological assets. Remove that one-time benefit, and Canopy's fourth quarter looks a whole lot uglier with an operating loss closer to CA$225 million. Yuck!
All told, Canopy's net loss in Q4 hit CA$323.4 million, pushing its full-year net loss to a ghastly CA$670.1 million.
Although Canopy Growth is losing money hand over fist as it expands its domestic and international infrastructure, one thing the company does have working in its favor is the roughly CA$4.5 billion in cash, cash equivalents, and marketable securities it ended the fiscal year with. This was down almost CA$400 million from the sequential third quarter.
A majority of the capital Canopy is working with was derived from the CA$5 billion equity investment fromConstellation Brandsthat upped its stake in the company to 37%. Having ample capital on hand should allow Canopy to execute on its long-term planswithout batting an eye.
Image source: Getty Images.
Even though it's a completely under-the-radar figure, the number that impressed me most in Canopy's fourth-quarter operating results was its CA$1.54 billion in goodwill. That's because this figure is down 15% from the sequential third quarter, where itreported CA$1.82 billion in goodwill.
Goodwill is nothing more than the premium an acquiring company pays above and beyond tangible assets. Since Canopy has been an active buyer in the pot space, we'd expect it to have paid some sort of premium to make deals happen. The question becomes whether the company can recoup this premium over time, or if it'll be forced to take an unsightly writedown. The fact that goodwill shrunk by almost CA$280 million from the sequential third quarter is very encouraging and reduces the likelihood that Canopy will write down a significant portion of its goodwill anytime soon.
Lastly, it's worth taking note that Canopy's share-based compensation expenses have continued to soar. In the most recent quarter, the company recorded CA$74.7 million in share-based compensation, primarily due to an increase in the number of people it employs. This compares to CA$40.1 million in share-based compensation in the sequential quarter and just CA$11.9 million in the year-ago quarter.
Typically, share-based compensation is a figure most (including myself) would gloss over. But it's becoming a significant component of total expenses each quarter -- not to mention that ongoing share-based compensation will continue to increase the company's outstanding share count, which can work against earnings per share, if and when Canopy Growth ever turns a profit.
Although there were plenty of numbers to like in this report, including the reduction in goodwill, ample cash balance, and growth in licensed production space, Canopy Growth still has a lot to prove to Wall Street.
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Sean Williamshas no position in any of the stocks mentioned. The Motley Fool recommends Constellation Brands. The Motley Fool has adisclosure policy. |
Is Huntsman Corporation (NYSE:HUN) A Financially Sound Company?
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Stocks with market capitalization between $2B and $10B, such as Huntsman Corporation (NYSE:HUN) with a size of US$4.6b, do not attract as much attention from the investing community as do the small-caps and large-caps. Despite this, commonly overlooked mid-caps have historically produced better risk-adjusted returns than their small and large-cap counterparts. Let’s take a look at HUN’s debt concentration and assess their financial liquidity to get an idea of their ability to fund strategic acquisitions and grow through cyclical pressures. Remember this is a very top-level look that focuses exclusively on financial health, so I recommend a deeper analysisinto HUN here.
View our latest analysis for Huntsman
Over the past year, HUN has ramped up its debt from US$2.3b to US$3.1b , which includes long-term debt. With this growth in debt, the current cash and short-term investment levels stands at US$444m , ready to be used for running the business. Additionally, HUN has generated cash from operations of US$775m during the same period of time, resulting in an operating cash to total debt ratio of 25%, signalling that HUN’s operating cash is sufficient to cover its debt.
Looking at HUN’s US$1.7b in current liabilities, it appears that the company has been able to meet these obligations given the level of current assets of US$3.1b, with a current ratio of 1.83x. The current ratio is calculated by dividing current assets by current liabilities. Generally, for Chemicals companies, this is a reasonable ratio as there's enough of a cash buffer without holding too much capital in low return investments.
With debt reaching 91% of equity, HUN may be thought of as relatively highly levered. This is not unusual for mid-caps as debt tends to be a cheaper and faster source of funding for some businesses. 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 after interest and tax at least three times its net interest payments is considered financially sound. In HUN's case, the ratio of 7.5x 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.
Although HUN’s debt level is towards the higher end of the spectrum, its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. This is only a rough assessment of financial health, and I'm sure HUN has company-specific issues impacting its capital structure decisions. I recommend you continue to research Huntsman to get a more holistic view of the mid-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for HUN’s future growth? Take a look at ourfree research report of analyst consensusfor HUN’s outlook.
2. Valuation: What is HUN 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 HUN 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 Does Investing In Tucows Inc. (NASDAQ:TCX) Impact The Volatility Of Your Portfolio?
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If you own shares in Tucows Inc. (NASDAQ:TCX) then it's worth thinking about how it contributes to the volatility of your portfolio, overall. In finance, Beta is a measure of volatility. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The second sort is caused by the natural volatility of markets, overall. For example, certain macroeconomic events will impact (virtually) all stocks on the market.
Some stocks mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. A stock with a beta below one is either less volatile than the market, or more volatile but not corellated with the overall market. In comparison a stock with a beta of over one tends to be move in a similar direction to the market in the long term, but with greater changes in price.
View our latest analysis for Tucows
Looking at the last five years, Tucows has a beta of 1.16. The fact that this is well above 1 indicates that its share price movements have shown sensitivity to overall market volatility. If this beta value holds true in the future, Tucows shares are likely to rise more than the market when the market is going up, but fall faster when the market is going down. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how Tucows fares in that regard, below.
Tucows is a small cap stock with a market capitalisation of US$642m. Most companies this size are actively traded. It's not particularly surprising that it has a higher beta than the overall market. That's because it takes less money to influence the share price of a smaller company, than a bigger company.
Since Tucows tends to moves up when the market is going up, and down when it's going down, potential investors may wish to reflect on the overall market, when considering the stock. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as Tucows’s financial health and performance track record. I highly recommend you dive deeper by considering the following:
1. Future Outlook: What are well-informed industry analysts predicting for TCX’s future growth? Take a look at ourfree research report of analyst consensusfor TCX’s outlook.
2. Past Track Record: Has TCX been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of TCX's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how TCX measures up against other companies on valuation. You could start with thisfree list of prospective options.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Key Bitcoin Price Indicator Suggests $21,000 ‘Fair Value’ By End Of 2019
The bitcoin (BTC) price is unlikely to break $40,000 in 2019, Bitcoin Knowledge podcast hostTrace Mayerdeclared as part ofnew analysison June 24.
Uploading fresh readings from his price forecasting tool, the ‘Mayer Multiple,’ the serial commentator andbitcoin proponentsaid that current trajectory should favor an end-of-year bitcoin price of $21,000.
This, while below the estimates of other industry figuressuch asFundstrat’sTom Lee, still places the largestcryptocurrencyahead of its record high set in December 2017.
The Mayer Multiple is a calculation achieved by dividing the current bitcoin price by its 200-day moving average. Currently at 2.09, the metric has only seen higher readings 14.79% of the time, meaning that a giant leap to $40,000, in particular, is unwarranted.
“...Very low probability of $40k in a few months,” Mayer summarized.
As Cointelegraphreported, bitcoin succeeded in retaking the $10,000 barrier late last week, only to go on past $11,000 within 24 hours.
The performance buoyed analysts, many of whom considered $10,000 to be a watershed moment. Investors waiting on the sidelines, they argued, would jump on board once five figures were reached, triggering a snowball upward price effect.
At press time Monday, markets were nonetheless taking a break from bullish movement, BTC/USD settling at around $10,850.
For the rest of the year and beyond, however, the Mayer Multiple considers moves through $15,000, $21,000 and then $30,500 to be probable. The first of these would nonetheless be “overvalued” should it hit in September, but thereafter, bitcoin would find its price niche.
June 2020 should trigger the $30,000+ bitcoin, roughly a month after the next block reward size halving event.
• CEO of Major American VC Firm Digital Currency Group: Crypto Winter Is Ending
• Former Wall Street Exec Tone Vays: There Is No Evidence That the Crypto Winter Is Now Over
• Crypto Analyst Says Bitcoin Price Could Hit $100,000 During Next Bull Run
• 4 Big Reasons Bitcoin’s Price Will Probably Not Stop at $20K This Time |
At US$60.29, Is Tucows Inc. (NASDAQ:TCX) Worth Looking At Closely?
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Tucows Inc. (NASDAQ:TCX), which is in the it business, and is based in Canada, received a lot of attention from a substantial price movement on the NASDAQCM over the last few months, increasing to $89.12 at one point, and dropping to the lows of $57.88. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Tucows's current trading price of $60.29 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Tucows’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 Tucows
The stock seems fairly valued at the moment according to my relative valuation model. 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 39.53x is currently trading slightly above its industry peers’ ratio of 35.73x, which means if you buy Tucows today, you’d be paying a relatively reasonable price for it. And if you believe that Tucows should be trading at this level in the long run, there’s only an insignificant downside when the price falls to its real value. Although, there may be an opportunity to buy in the future. This is because Tucows’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
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. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. Tucows’s revenue growth are expected to be in the teens in the upcoming years, indicating a solid future ahead. Unless expenses grow at the same level, or higher, this top-line growth should lead to robust cash flows, feeding into a higher share value.
Are you a shareholder?TCX’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at TCX? 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 an eye on TCX, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic forecast is encouraging for TCX, 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 Tucows. You can find everything you need to know about Tucows inthe latest infographic research report. If you are no longer interested in Tucows, 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. |
When Should You Buy Hope Bancorp, Inc. (NASDAQ:HOPE)?
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Hope Bancorp, Inc. (NASDAQ:HOPE), operating in the financial services industry based in United States, saw significant share price movement during recent months on the NASDAQGS, rising to highs of $14.4 and falling to the lows of $12.37. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Hope Bancorp's current trading price of $13.22 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Hope Bancorp’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 Hope Bancorp
Good news, investors! Hope Bancorp is still a bargain right now. According to my valuation, the intrinsic value for the stock is $18.2, but it is currently trading at US$13.22 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Hope Bancorp’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. However, with a negative profit growth of -3.2% expected next year, near-term growth certainly doesn’t appear to be a driver for a buy decision for Hope Bancorp. This certainty tips the risk-return scale towards higher risk.
Are you a shareholder?Although HOPE is currently undervalued, the adverse prospect of negative growth brings about some degree of risk. Consider whether you want to increase your portfolio exposure to HOPE, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor?If you’ve been keeping an eye on HOPE 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 Hope Bancorp. You can find everything you need to know about Hope Bancorp inthe latest infographic research report. If you are no longer interested in Hope Bancorp, 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. |
What Does Hope Bancorp, Inc.'s (NASDAQ:HOPE) Share Price Indicate?
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Hope Bancorp, Inc. (NASDAQ:HOPE), operating in the financial services industry based in United States, received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to $14.4 at one point, and dropping to the lows of $12.37. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Hope Bancorp's current trading price of $13.22 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Hope Bancorp’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 Hope Bancorp
Great news for investors – Hope Bancorp is still trading at a fairly cheap price. According to my valuation, the intrinsic value for the stock is $18.2, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. However, given that Hope Bancorp’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 another chance to buy in the future. 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. Though in the case of Hope Bancorp, it is expected to deliver a negative earnings growth of -3.2%, which doesn’t help build up its investment thesis. It appears that risk of future uncertainty is high, at least in the near term.
Are you a shareholder?Although HOPE 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 HOPE, or whether diversifying into another stock may be a better move for your total risk and return.
Are you a potential investor?If you’ve been keeping tabs on HOPE for some time, 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 Hope Bancorp. You can find everything you need to know about Hope Bancorp inthe latest infographic research report. If you are no longer interested in Hope Bancorp, 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. |
Trump threatens new sanctions on Iran: Morning Brief
Monday, June 24, 2019
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After hitting record highs last week, the market will be put to the test this week.
Tensions have been running extremely hot between the U.S. and Iran, after a U.S. surveillance drone was shot down last week. President Donald Trump nearly waged a military strike before ultimately calling off the operation. Furthermore over the weekend, the Trump administration indicated thatIran could face new sanctions, but that the U.S. is prepared to negotiate with Iran without any preconditions.Oil prices continued to rise Monday morningamid the tensions.
Meanwhile, investors are anxiously awaiting the meeting between President Trump and Chinese President Xi Jinping at the G20 summit in Osaka, Japan at the end of the week. The two leaders are expected to hold an extended meeting to discuss trade.
Read more
U.S. reportedly explores requiring domestic 5G equipment to be made outside China: President Donald Trump is looking to require next-generation 5G cellular equipment used in the United States to be designed and manufactured outside China, the Wall Street Journal reported. As part of a 150-day review that started after cybersecurity concerns in the United States, officials are asking telecom equipment makers if they can develop U.S.-bound hardware including cellular-tower electronics as well as routers and switches, and software outside of China. [Reuters]
Bitcoin is back above $10,000: 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. [Yahoo Finance UK]
Eldorado agrees to buy Caesars for about $8.7 billion: Eldorado Resorts Inc. (ERI) agreed to buy Caesars Entertainment Corp. (CZR) for about $8.7 billion in cash and stock, according to a person familiar with the situation. The deal values Caesars at about $13 a share, according to the person, who asked not to be identified because the information isn’t public. Including assumed Caesars debt, the transaction would be valued at about $18 billion. [Bloomberg]
Goldman Sachs plans to disrupt banking: With its startup consumer bank Marcus, Goldman Sachs (GS) wants to disrupt banking the way Amazon (AMZN) disrupted retail and and Apple (APPL) upended music. Specifically, the 150-year old bank’s goal is to transform "the distribution and consumption experience of financial services," according to Harit Talwar, the head of global consumer business for Goldman Sachs. [Yahoo Finance]
Canopy Growth may have just made its most ambitious claim yet — can it deliver?
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A 'pretty simple' reason why there's no female big bank CEO: Krawcheck
Cleveland Cavalier's Kevin Love supports Mark Cuban 2020 presidential bid
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If You Had Bought Hansa Resources (CVE:HRL) Shares Three Years Ago You'd Have Made 75%
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By buying an index fund, investors can approximate the average market return. But many of us dare to dream of bigger returns, and build a portfolio ourselves. For example,Hansa Resources Limited(CVE:HRL) shareholders have seen the share price rise 75% over three years, well in excess of the market return (13%, not including dividends).
Check out our latest analysis for Hansa Resources
Hansa Resources didn't have any revenue in the last year, so it's fair to say it doesn't yet have a proven product (or at least not one people are paying for). 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. For example, investors may be hoping that Hansa Resources finds some valuable resources, before it runs out of money.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). Hansa Resources has already given some investors a taste of the sweet gains that high risk investing can generate, if your timing is right.
Hansa Resources had cash in excess of all liabilities of CA$511k when it last reported (March 2019). That's not too bad but management may have to think about raising capital or taking on debt, unless the company is close to breaking even. Given the share price has increased by a solid 21% per year, over 3 years, its fair to say investors remain excited about the future, despite the potential need for cash. The image below shows how Hansa Resources'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. However you can take a look at whether insiders have been buying up shares. If they are buying a significant amount of shares, that's certainly a good thing. You canclick here to see if there are insiders buying.
Hansa Resources shareholders are down 42% for the year, but the market itself is up 1.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 3.1% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. You could get a better understanding of Hansa Resources's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
If You Had Bought Hansa Resources (CVE:HRL) Stock Three Years Ago, You Could Pocket A 75% Gain Today
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By buying an index fund, investors can approximate the average market return. But if you pick the right individual stocks, you could make more than that. For example, theHansa Resources Limited(CVE:HRL) share price is up 75% in the last three years, clearly besting than the market return of around 13% (not including dividends).
Check out our latest analysis for Hansa Resources
With zero revenue generated over twelve months, we don't think that Hansa Resources has proved its business plan yet. So it seems that the investors focused more on what could be, than paying attention to the current revenues (or lack thereof). It seems likely some shareholders believe that Hansa Resources will find or develop a valuable new mine before too long.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. 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 such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). Of course, if you time it right, high risk investments like this can really pay off, as Hansa Resources investors might know.
When it last reported its balance sheet in March 2019, Hansa Resources had cash in excess of all liabilities of CA$511k. That's not too bad but management may have to think about raising capital or taking on debt, unless the company is close to breaking even. With the share price up 21% per year, over 3 years, the market is seems hopeful about the potential, despite the cash burn. You can see in the image below, how Hansa Resources's cash levels have changed over time (click to see the values).
Of course, the truth is that it is hard to value companies without much revenue or profit. One thing you can do is check if company insiders are buying shares. If they are buying a significant amount of shares, that's certainly a good thing. You canclick here to see if there are insiders buying.
Investors in Hansa Resources had a tough year, with a total loss of 42%, against a market gain of about 1.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 3.1% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. Shareholders might want to examinethis detailed historical graphof past earnings, revenue and cash flow.
But note:Hansa Resources may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
China's iQiyi looks abroad after hitting 100 million paying subscribers
(This June 24 story corrects to add company clarification that iQiyi's partnership with Netflix has ended, not ongoing. Removes quote which suggested that partnership was ongoing.) By Pei Li and Brenda Goh BEIJING (Reuters) - iQiyi, China's answer to Netflix, intends to push harder into overseas markets such as North America and Japan after the video-streaming service hit a milestone of 100 million paying subscribers this month, a senior executive said on Monday. The company, which has been locked in a cash-burning fight with Tencent's video site and Alibaba-backed Youku Tudou in China, wants to distribute more of its self-produced content in North America, Singapore, South Korea and Japan, where they were seeing growing interest in Chinese-language shows, iQiyi's President of Membership and Overseas Business, Yang Xianghua, told Reuters in an interview. "Given more time, I think we can have a lot of opportunities in other markets globally," he said. The company, which produces original TV programs, reality shows, and online movies, announced on Saturday that it had reached the 100 million paid subscriber mark, which it attributed to its focus on acquiring viewers among the country's elderly and rural residents. In comparison, Tencent Video said in May that it had 89 million paying subscribers respectively while Netflix Inc in January said it had over 139 million paid memberships in over 190 countries. iQiyi currently distributes its content overseas through tie-ups with local streaming sites. A bigger push overseas could eventually see iQiyi go head-to-head with Netflix, with which it signed a licensing deal in 2017. Under that partnership, which iQiyi said had expired in September last year, Netflix had streamed some of its content through iQiyi's site. (Reporting by Pei Li and Brenda Goh; editing by Uttaresh.V) |
Such Is Life: How Geron (NASDAQ:GERN) Shareholders Saw Their Shares Drop 58%
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Investing in stocks comes with the risk that the share price will fall. And there's no doubt thatGeron Corporation(NASDAQ:GERN) stock has had a really bad year. The share price has slid 58% in that time. We note that it has not been easy for shareholders over three years, either; the share price is down 42% in that time. The good news is that the stock is up 1.7% in the last week.
View our latest analysis for Geron
Geron recorded just US$805,000 in revenue over the last twelve months, which isn't really enough for us to consider it to have a proven product. 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. It seems likely some shareholders believe that Geron has the funding to invent a new product before too long.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. While some such companies go on to make revenue, profits, and generate value, others get hyped up by hopeful naifs before eventually going bankrupt. It certainly is a dangerous place to invest, as Geron investors might realise.
When it last reported its balance sheet in March 2019, Geron could boast a strong position, with cash in excess of all liabilities of US$146m. That allows management to focus on growing the business, and not worry too much about raising capital. But with the share price diving 58% in the last year, it could be that the price was previously too hyped up. The image below shows how Geron'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? I would feel more nervous about the company if that were so. It costs nothing but a moment of your time tosee if we are picking up on any insider selling.
We'd be remiss not to mention the difference between Geron'stotal shareholder return(TSR) and itsshare price return. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Geron hasn't been paying dividends, but its TSR of -58% exceeds its share price return of -58%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.
While the broader market gained around 6.6% in the last year, Geron shareholders lost 58%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 11% per year over five years. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
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 US exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Does Humana Inc.'s (NYSE:HUM) Debt Level Pose A Problem?
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There are a number of reasons that attract investors towards large-cap companies such as Humana Inc. (NYSE:HUM), with a market cap of US$36b. Market participants who are conscious of risk tend to search for large firms, attracted by the prospect of varied revenue sources and strong returns on capital. However, the key to their continued success lies in its financial health. Let’s take a look at Humana’s leverage and assess its financial strength to get an idea of their ability to fund strategic acquisitions and grow through cyclical pressures. Note that this information is centred entirely on financial health and is a high-level overview, so I encourage you to look furtherinto HUM here.
See our latest analysis for Humana
Over the past year, HUM has ramped up its debt from US$5.3b to US$6.7b – this includes long-term debt. With this growth in debt, HUM currently has US$14b remaining in cash and short-term investments to keep the business going. Its negative operating cash flow means calculating cash-to-debt wouldn't be useful. As the purpose of this article is a high-level overview, I won’t be looking at this today, but you can examine some of HUM’soperating efficiency ratios such as ROA here.
With current liabilities at US$12b, the company has been able to meet these commitments with a current assets level of US$20b, leading to a 1.65x current account ratio. The current ratio is the number you get when you divide current assets by current liabilities. Generally, for Healthcare 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 58% of equity, HUM may be thought of as relatively highly levered. This is common amongst large-cap companies because debt can often be a less expensive alternative to equity due to tax deductibility of interest payments. Since large-caps are seen as safer than their smaller constituents, they tend to enjoy lower cost of capital. 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. As a rule of thumb, a company should have earnings before interest and tax (EBIT) of at least three times the size of net interest. In HUM's case, the ratio of 14.04x suggests that interest is amply covered. It is considered a responsible and reassuring practice to maintain high interest coverage, which makes HUM and other large-cap investments thought to be safe.
HUM’s cash flow coverage indicates it could improve its operating efficiency in order to meet demand for debt repayments should unforeseen events arise. However, the company exhibits an ability to meet its near-term obligations, which isn't a big surprise for a large-cap. This is only a rough assessment of financial health, and I'm sure HUM has company-specific issues impacting its capital structure decisions. I suggest you continue to research Humana to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for HUM’s future growth? Take a look at ourfree research report of analyst consensusfor HUM’s outlook.
2. Valuation: What is HUM 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 HUM 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. |
Does Evercore (NYSE:EVR) Deserve A Spot On Your Watchlist?
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Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling short, can easily find investors. But as Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.'
In the age of tech-stock blue-sky investing, my choice may seem old fashioned; I still prefer profitable companies likeEvercore(NYSE:EVR). 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.
Check out our latest analysis for Evercore
Over the last three years, Evercore 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 the last firework on New Year's Eve accelerating into the sky, Evercore's EPS shot from US$3.54 to US$8.59, over the last year. You don't see 143% year-on-year growth like that, very often.
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. Evercore maintained stable EBIT margins over the last year, all while growing revenue 18% to US$2.0b. That's progress.
In the chart below, you can see how the company has grown earnings, and revenue, over time. Click on the chart to see the exact numbers.
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 Evercore?
It makes me feel more secure owning shares in a company if insiders also own shares, thusly more closely aligning our interests. So it is good to see that Evercore insiders have a significant amount of capital invested in the stock. With a whopping US$52m worth of shares as a group, insiders have plenty riding on the company's success. That's certainly enough to make me think that management will be very focussed on long term growth.
Evercore's earnings per share have taken off like a rocket aimed right at the moon. That EPS growth certainly has my attention, and the large insider ownership only serves to further stoke my interest. The hope is, of course, that the strong growth marks a fundamental improvement in the business economics. So to my mind Evercore is worth putting on your watchlist; after all, shareholders do well when the market underestimates fast growing companies. Now, you could try to make up your mind on Evercore by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry.
You can invest in any company you want. But if you prefer to focus on stocks that have demonstrated insider buying, here isa list of companies with insider buying in the last three months.
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. |
Poll: What do Democrats want to hear about at the debates? (Hint: It's not Trump.)
Democratic voters will be paying close attention to the opening candidate debates next week, and they have strong views about what they want discussed. Hint: It's not Donald Trump . Health care, immigration, the economy, climate change, education and taxes top the list of issues Democrats told a USA TODAY/Suffolk University Poll they want to hear about during the two-night, 20-candidate debate marathon in Miami. President Trump, including efforts to get him out of the White House, ranked eighth in responses to the open-ended question, named by just 4%. Fewer than 1% cited "election interference." "One of the key things is global warming; this is like the biggest issue of our lifetime," said Ethan Raboin, 29, a college student in Manchester, New Hampshire, who was among those surveyed. Carlos Sandi, 46, of Gainesville, Georgia, said he is looking for a candidate who is "connected to the real issues that ordinary Americans face, not trigger issues that spike elections." 2020 elections: What you need to know so far Nearly every Democratic voter in the poll called the debates crucial to sorting out a record field of contenders . An overwhelming majority, 82%, said they'll be watching, and 86% said the debates will be important in determining which candidate they'll support. More than half, 54%, called them "very important." "It's kind of a dog-and-pony show," Jacob Cushman, 38, a registered nurse from Naples, Fla., said in a follow-up interview, but "hopefully it'll whittle down the candidates." What to watch for: Biden vs. Sanders, other things to watch in first Democratic debate The survey gave Joe Biden a big lead, but it could be a fragile one. Thirty percent of those likely to vote in Democratic primaries and caucuses said they were supporting or leaning toward the former vice president. Vermont Sen. Bernie Sanders was second at 15%, Massachusetts Sen. Elizabeth Warren third at 10%, South Bend Mayor Pete Buttigieg fourth at 9% and California Sen. Kamala Harris fifth at 8%. Story continues Democratic presidential candidate, Sen. Kamala Harris, D-Calif., speaks during a campaign event at the Unity Freedom Presidential Forum Friday, May 31, 2019, in Pasadena, Calif. The only other candidates backed by more than 1% were New Jersey Sen. Cory Booker at 2%, and former Obama Cabinet member Julian Castro and former Colorado governor John Hickenlooper at 1% each. Widening the campaign map: Why 2020 candidates are looking beyond the early states to court voters A burst of excitement The survey also measured interest in the Democratic field – and the prospect of potential support – in another way. When asked which candidates they would be "excited" to see running, Democrats and independents showed a surge of enthusiasm since the USA TODAY/Suffolk survey in March for Buttigieg (up 24 points to 31%), Warren (up five points to 37%) and Harris (up four points to 40%). That sense of excitement had dropped since March for Biden (down eight points to 51%) and former Texas congressman Beto O'Rourke (down eight points to 26%). "After front-runner Joe Biden, Elizabeth Warren is the one who finishes in the money most," said David Paleologos, director of Suffolk's Political Research Center. "Warren polls as the second- or third-place choice four times out of 10, followed by Sanders (three times), Harris (twice) and Buttigieg (once)." U.S. Sen. Elizabeth Warren, D-Mass., speaks during the Iowa Democratic Party Hall of Fame dinner, Sunday, June 9, 2019, at the DoubleTree by Hilton in Cedar Rapids, Iowa. In the opening Iowa caucuses, that could prove crucial in amassing the 15% support required for a candidate to claim convention delegates. The debates are a chance for a lower-tier contender to seize attention. "There might be some flaming response from someone who just strikes me and I have no idea he would, and it would change my mind," said Edna Wilcock, 72, a retired pediatric nurse from Sequim, Washington, who now supports Biden. "That's why we have all these debates." Who's running for president in 2020?: Meet the candidates in an interactive guide The poll of 1,000 registered voters was taken June 11-15. The margin of error was three percentage points for the full sample, five points for the sample of 385 respondents who said they were likely to vote in Democratic primaries or caucuses, and four points for the combined sample of 618 Democrats and independents. Trump formally kicked off his reelection campaign Tuesday night in Orlando with a rally before thousands of cheering, chanting supporters. In a defiant, meandering speech that lasted more than an hour, he boasted about his record in office on the economy and blasted his Democratic opponents as "socialists" and left-wing extremists. At the moment, Americans are inclined to believe Trump will win a second term. In the survey, voters by 49%-38% predicted Trump would prevail over an unnamed Democratic nominee. That included 86% of Republicans and 14% of Democrats. Amy Angel, 59, a Democrat from Fairfax, Virginia, remembered what happened in 2016. "I really believed Hillary Clinton would win, and then she did not," the stay-at-home mother of five said. "We need to come together in a way that progressives and independents and Democrats did not manage in 2016." She supports Biden, but that could change. "Biden currently has my vote to lose," she said. "I'm not 100%. He's not a perfect candidate, but the reality is no one is." James Lay, 43, a Republican from Richmond Hill, Georgia, predicted Trump would triumph because of Democrats' divisions. "There's no single candidate that is going to be able to consolidate the entire voter base to the point where they can beat him," said Lay, who works in sales. "Bernie people are Bernie people; they are not the same as Kamala Harris people, who aren't the same as Beto people, who aren't the same as Buttigieg people." More from the poll: Most Americans want Trump to comply with House subpoenas. But impeach him? Not so fast A warning flag for Trump Asked whom they would support if the election were today, Trump held a narrow edge over an unnamed Democrat nominee, 40%-37%. Nine percent supported an unnamed third party candidate, and 14% were undecided. Trump has consolidated more Republican support (83%) than his generic Democratic opponent has consolidated Democratic support (77%). 'We're off and running': A look at Trump's un-Trumpian campaign for reelection A warning flag for Trump: Other national polls that test head-to-head contests between him and some of the leading Democratic candidates have shown the president trailing with support that has stayed steady at 40% to 42% – just where he stood in this survey. He presumably would need to expand his support to prevail in a two-way race. In the Republican primaries, Trump's nomination seems all but guaranteed. In the poll, nine of 10 of those likely to vote in GOP primaries or caucuses supported him. Five percent would vote for former Massachusetts governor Bill Weld, a long-shot challenger. Despite Trump's daunting lead, Republican voters still said by nearly 2-1, 60% to 36%, that they would like to see a GOP debate. Timing matters: California's primary is way earlier in 2020. Is that good for Democrats? Who is that again? The Democratic debates next Wednesday and Thursday in Miami loom as a test for the better-known candidates and an opportunity for the more obscure ones. More than half of the Democratic voters said they had never heard of six of the 20 candidates who qualified to participate in the debates. "This is going to be an introduction to those people who will actually watch the debate for a whole group of new, fresh faces," said Rand Hoch, 64, a retired judge from West Palm Beach, Florida. A former chair of the Palm Beach County Democratic Party, he was among those called randomly in the phone survey. He has been impressed by Buttigieg. Pete Buttigieg at a campaign rally at Indiana University Auditorium, Bloomington, Tuesday, June 11, 2019. "He's the mayor from basically a small city that one has not heard of before, and he's coming up with great ideas," he said. Tom Bryan, 72, a marketing and real estate agent from Columbus, Georgia, said O'Rourke "comes on strong" but is also interested in hearing from Biden and Warren. "The economy, health care are probably the two most important" issues, he said, "with the exception of our relationship with our partners around the world, which is going to hell in a handbasket." There were signs that some Democratic voters were feeling overwhelmed by the number of choices. For 11 of the 20 contenders who will be on stage, more Democratic voters said they "hope this person drops out of the running" than said they were excited about their candidacy. Many said they were struggling to decide between the candidate they liked best and the one they calculated would have the best chance of winning in November 2020. "When it comes to policy and just smarts, Elizabeth Warren outshines pretty much everyone, but then I weigh with that, do I think she could get elected?" said Tanae McLean, 48, of Mooresville, North Carolina. "If you go by polling, obviously Joe Biden's a front-runner. Do I think he has the best ideas? I love Joe Biden, but no. ... "I'm definitely open-minded at this point." The debate lineup: Which candidates will face off in Miami? Trump vs. Biden: Septuagenarian rivals try to demonstrate vigor in Iowa This article originally appeared on USA TODAY: Poll: What do Democrats want to hear about at the debates? (Hint: It's not Trump.) |
I Ran A Stock Scan For Earnings Growth And Evercore (NYSE:EVR) Passed With Ease
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Like a puppy chasing its tail, some new investors often chase 'the next big thing', even if that means buying 'story stocks' without revenue, let alone profit. Unfortunately, high risk investments often have little probability of ever paying off, and many investors pay a price to learn their lesson.
So if you're like me, you might be more interested in profitable, growing companies, likeEvercore(NYSE:EVR). 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 Evercore
In the last three years Evercore'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 the last firework on New Year's Eve accelerating into the sky, Evercore's EPS shot from US$3.54 to US$8.59, over the last year. You don't see 143% year-on-year growth like that, very often.
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. Evercore maintained stable EBIT margins over the last year, all while growing revenue 18% to US$2.0b. 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 Evercore'sfutureprofits.
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 Evercore shares worth a considerable sum. Given insiders own a small fortune of shares, currently valued at US$52m, they have plenty of motivation to push the business to succeed. This should keep them focused on creating long term value for shareholders.
Evercore's earnings per share have taken off like a rocket aimed right at the moon. That EPS growth certainly has my attention, and the large insider ownership only serves to further stoke my interest. At times fast EPS growth is a sign the business has reached an inflection point; and I do like those. So yes, on this short analysis I do think it's worth considering Evercore for a spot on your watchlist. While we've looked at the quality of the earnings, we haven't yet done any work to value the stock. So if you like to buy cheap, you may want tocheck if Evercore is trading on a high P/E or a low P/E, relative to its industry.
Of course, you can do well (sometimes) buying stocks thatare notgrowing earnings anddo nothave insiders buying shares. But as a growth investor I always like to check out companies thatdohave those features. You can accessa free list of them here.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Self-build: Pros, cons of building your own home
Self-build is not for the faint-hearted. Photo: Getty Many of us dream of building our own homes. Yet, while it’s a common aspiration in the UK, we’re far less likely to self-build here than in other countries across Europe. Self-build accounts for between 7% and 10% of all new housing across the country, around 12,000 homes per year, according to a House of Commons briefing paper. By contrast, that figure is 80% in Austria. Yet a 2011 survey by the Building Societies Association found that more than half of Britons (53%) would consider self-build if the opportunity was available to them. As such, the government has encouraged self-build in recent years, hoping to boost housing supply. There are both rewards and risks with self-build houses. What is a dream can soon turn into a nightmare as cost and complexity derail self-build projects. Here are the major pros and cons of self-build: Pros Bespoke Because you’re building your own home (or more likely, paying someone else to do the actual work), you’re involved at every stage of the process. That means you can tailor the design and finish to all of your specific wants and needs. For example, you can build a super-green home that’s so energy efficient you don’t get any electricity bills. Self-build homes are bespoke, so you can get exactly what you want from a property. READ MORE: The true cost of buying a home: What to budget for when buying a property Ideal plot Often when buying a home you’ll need to compromise on the plot. The building may be what you had in mind, but it’s not in the greatest setting. But when you’re self-building, you’re buying the land as well. So you can choose a plot that meets your desires, such as overlooking the sea, or in a remote rural location. Savings In theory, and often in practice, self-build can be cheaper than buying a ready-made home. The cost of land plus construction can, with research and careful planning, come in lower than the resulting property’s market value. So not only would it be cheaper than buying a similar property that’s already there, but you could make some money off of the end product, too. What’s more, you can claim back VAT on the construction. Story continues READ MORE: The best ways to increase your property's value Cons Risky There’s always the risk that things go wrong or that you weren’t stringent enough in your planning beforehand. Budgets can quickly spin out of control as unforeseen problems arise during construction and if you’re relying on a mortgage, the money will usually be released in stages, which can create cash flow problems that delay and disrupt the project. You need to be sure that you have enough money saved up to see the self-build project through to the end because otherwise you’ll end up living in an empty shell of a property with no utilities. Another risk is that you might make the property a little too bespoke, meaning it’s so unique that the resale market is small, affecting your chance of reselling the house if you ever wanted to. READ MORE: Home buying: the pros and cons of new build vs period houses Stress Self-build is not for the faint-hearted. These projects can take months, sometimes even years, before the home is finished. That requires a lot of patience, especially if you’re having to rent in awkward or uncomfortable accommodation while work takes place. You’ll also need a cool head if things go wrong. Moreover, you need to be an excellent project manager, or hire a good one, which is hard if you’re having to work a full-time job alongside overseeing the construction. No building project is ever straightforward. In truth, self-build is highly stressful. There’s a lot of money — and your home — at stake. Do you have the mettle for it? |
Should You Be Excited About BioTime, Inc.'s (NYSEMKT:BTX) 35% Return On Equity?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. By way of learning-by-doing, we'll look at ROE to gain a better understanding of BioTime, Inc. (NYSEMKT:BTX).
BioTime has a ROE of 35%, based on the last twelve months. That means that for every $1 worth of shareholders' equity, it generated $0.35 in profit.
View our latest analysis for BioTime
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for BioTime:
35% = US$57m ÷ US$161m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the profit over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal,investors should like a high ROE. That means it can be interesting to compare the ROE of different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As is clear from the image below, BioTime has a better ROE than the average (19%) in the Biotechs industry.
That is a good sign. I usually take a closer look when a company has a better ROE than industry peers. For example,I often check if insiders have been buying shares.
Virtually all companies need money to invest in the business, to grow profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
While BioTime does have a tiny amount of debt, with debt to equity of just 0.00094, we think the use of debt is very modest. When I see a high ROE, fuelled by only modest debt, I suspect the business is high quality. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. Companies that can achieve high returns on equity without too much debt are generally of good quality. All else being equal, a higher ROE is better.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
Of courseBioTime may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
4 Things You Must Do the Year Before You Retire
Retirement is an exciting milestone, but one you really need to prepare for extensively. If you're planning to retire in about a year's time, make sure to check these critical items off your list.
You're probably aware of how much savings you have in your IRA or 401(k) plan. But do you know how much annual income your savings will provide you? As a general rule, you can expect to withdraw about4% of your savings balanceannually to avoid depleting your nest egg prematurely. Of course, you can play around with this figure and adjust it as you see fit, but for the purpose of this example, we'll go with that classic 4%.
Now, let's say you're sitting on $500,000 in retirement savings. That might seem like a ton of money. But if you're only looking to withdraw 4% annually, it gives you just $20,000 per year to spend. That's not necessarily terrible if you have other income sources at your disposal, like Social Security, but it doesn't necessarily mean you're retiring rich, either. Therefore, be aware of what your savings will actually do for you income-wise rather than fixate on what seems like a grand number on a screen.
The more debt you retire with, the more your limited income will be monopolized by pesky monthly payments. Retiring with a small amount of debt isn't necessarily terrible, but retiring with a ton of it could put a huge strain on your resources down the line. Therefore, if you're sitting on, say, $20,000 in credit card debt and another $40,000 in the form of an unpaid mortgage, you might think about delaying retirement until you've managed to knock some of it out (keeping in mind that you should first focus on unhealthy debt, like that of the credit card variety, before paying down a mortgage).
Chances are, you'll rely on Social Security to some extent once you retire. That's why you need to put some thought into when you'll be filing for benefits. You're allowed to claim Social Security as early as age 62, but if you file before reachingfull retirement age(either 66, 67, or somewhere in between, depending on the year you were born), you'll reduce your benefits, and most likely for life. There's also the option todelay benefitspast full retirement age and grow them by 8% a year up until you turn 70.
The decisions you make with regard to Social Security will likely boil down to factors such as your level of personal savings and yourhealth(the healthier you are, the more it pays to delay benefits). But either way, nail down a filing strategy rather than assume that you'll sign up for benefits the moment you stop working.
You're probably planning to enroll inMedicareonce you stop working -- but unless you'll be retiring at 65 or later, that option is off the table. If you're planning to retire before turning 65, you'll need an alternate means of health insurance, whether it's a plan you buy on the open marketplace or coverage underCOBRA.
Even if youareeligible to get on Medicare as soon as you retire, you may not want the traditional version of it. Original Medicare is divided into three distinct parts -- A, B, and D -- and the latter two cost money in the form of monthly premiums (Part A is generally free). Traditional Medicare, however, doesn't cover a number of key services that seniors tend to need, like dental, vision, and hearing, so you may want to look into aMedicare Advantageplan instead. Advantage plans are often comparable in cost to traditional Medicare, only they cover the aforementioned services and offer other key benefits that original Medicare doesn't. Figure out exactly what you'll be doing for health coverage in retirement so you're not left scrambling once you're no longer covered under an employer plan.
Retiring is a major step, and one you shouldn't take blindly. Make these key moves as you gear up to retire so you don't wind up stressed once your career comes to a close.
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Eldorado Resorts takes on bigger rivals with $8.5 billion Caesars buy
(Reuters) - U.S. casino operator Eldorado Resorts Inc has agreed to buy rival Caesars Entertainment Corp for about $8.5 billion in cash and stock, as it looks to build scale to take on larger companies such as Las Vegas Sands and Wynn Resorts.
The deal comes more than three months after Caesars agreed to give billionaire investor Carl Icahn three board seats to his representatives and a say on the selection of its next chief executive officer.
Icahn, who has been pressing for a sale of Caesars, held a 14.75% stake in the company as of March 31, according to data from Refinitiv Eikon.
Shares of Caesars, up 47% this year, rose 11.4% to $14.51 at mid-afternoon, while Eldorado's stock, which has increased 41.4% year to date, fell 13.2% to $44.45.
Eldorado has made a series of acquisitions over the past few years including a $1.85 billion deal for Icahn-backed Tropicana Entertainment in 2018 and a $1.7 billion deal for Isle of Capri Casinos in 2017, strengthening its free cash flow and earnings per share.
The company's stock has risen more than 10 times since it went public in 2014, outperforming MGM Resorts, Las Vegas Sands and Wynn Resorts, whose shares have been under pressure due to their exposure to Macau and trade tensions with China.
"Eldorado has proven its ability to execute. ... We expect the long-term positives (of the deal) could prove out," Jefferies analyst David Katz said.
Eldorado's offer of $13.01 per share represents a premium of about 30% to Caesar's closing price on Friday.
Caesars, which emerged from bankruptcy in 2017, operates casinos with the Harrah's and Horseshoe brands. The company owns and operates 34 properties in 9 U.S. states and three continents, and its long-term debt stood at $8.79 billion as of March 31.
Founded in 1973 by the Carano family, Eldorado had long-term debt of about $3.06 billion at the end of March. The company owns and operates 26 properties in 12 U.S. states.
Icahn said he was "pleased" by the deal announcement.
"It is rare that you see a merger where because of the great synergies 'one plus one equals five.' I look forward to seeing our investment prosper," he said in a statement http://bit.ly/2KBX10z.
The deal price represents a premium of 51% over Caesar's trading price on the day before Icahn's representatives joined the board of Caesars on March 1.
Eldorado and Caesars shareholders will hold about 51% and 49% of the combined company's shares following the close of the deal in the first half of 2020. The company is targeting $500 million in savings in the first year of its operation.
In a parallel deal, the combined company will sell some of its real estate to VICI Properties Inc, while generating $3.2 billion of proceeds.
(Reporting by Ankit Ajmera in Bengaluru; Editing by Maju Samuel) |
Lessons From the VC Who's Seen It All Before
Wearing a long-sleeve black shirt,blue shorts, a knee brace on his right leg (basketball injury), and a backpack filled with water bottles and an emergency water-filtration straw (don’t ask), Jeff Jordan appears from behind a line of trees. Lean bordering on gaunt, with closely cropped black hair, Jordan has already hiked 40 minutes in the woods before arriving for a scheduled walk-and-talk on a trail near his home in Portola Valley, Calif. “Sorry,” he says. “I wake up really early.”
Jordan, who is 60, savors his alone time in the morning. Office hours are at the nearby venture capital firm Andreessen Horowitz, where he meets with entrepreneurs, listens to pitches, and decides which of these prospects are worthy of the firm’s backing. But in the wee hours, he typically sets out alone. “I have to be an extrovert at work. So to recover, I just walk through the hills,” he says, before making the shocking confession, at least in the type A world of Silicon Valley VCs, that he’s “right on the introvert-extrovert line.” Says Jordan: “It’s the only thing in my day I do that’s solitary. Everything else is meeting after meeting after meeting.”
Fortunately for Jordan and his partners, his enervating face time has proved fruitful. On behalf of Andreessen Horowitz, Jordan invested early in what are now some of the hottest companies in tech, including home-sharing giant Airbnb, grocery delivery company Instacart, and the hobbyist site Pinterest. The firm’s bet on Pinterest alone, one of Jordan’s first after joining the firm in 2011, is worth $1 billion. Jordan’s nonmonetary reward: Earlier this year he became managing partner of the decade-old firm, meaning he’s now responsible for personnel, budgeting, day-to-day operations, and the like, all while continuing to invest and sit on boards. (He’s currently on nine, including still-private Airbnb and Instacart, newly public Pinterest, and high-stakes e-scooter startup Lime.)
Jordan is a bit of an outlier at the epicenter of the global technology industry, a place of titanic egos and triumphs borne of brilliant ideas. He didn’t become a VC, widely acknowledged to be a young person’s game, until he was in his fifties. He’s not a technologist but rather a general-management type, typically second-class citizens in the Valley. And he at least professes to hate being in the spotlight. What he has, in spades, is something that is gaining currency amid the scandals and missteps of the Valley’s behemoths: experience. Says Meg Whitman, Jordan’s boss atDisneyand later at eBay: “Investing requires pattern recognition, and Jeff was able to recognize the potential” of the companies he has invested in, thanks to what he had seen earlier in his career, particularly ateBay.
Thanks to these successes, and the battle scars Jordan makes no effort to hide, entrepreneurs young and old now want to learn from him. Pattern recognition can’t necessarily be taught. But getting advice from someone who can see it—especially when that someone didn’t always make the right call or climb to the highest rung on the ladder—is beyond valuable. As for what drives him, well, let’s just say Jordan isn’t above having something to prove, a trait that makes him fit in rather well in Silicon Valley after all.
Jordan’s first reactionto Airbnb was that it was “the stupidest idea I had ever heard.” It was 2011, and he was at an Allen & Co. tech-investing meeting in Arizona. Brian Chesky, then a relatively unknown entrepreneur, was explaining his business, and Jordan couldn’t help mentally listing the number of risks associated with opening up one’s home to strangers. Then it hit him. Airbnb’s fast growth and online marketplace that matched homeowners with renters reminded him of eBay. It was, he says, “a déjà vu experience.” Having worked in top positions at eBay for seven years, he literally had seen this picture before.
Jordan and Chesky met after the entrepreneur’s talk, and the two discussed network effects, the notion that a product or service becomes increasingly valuable the more people who use it. Chesky was looking for investors, and Jordan was interested in becoming one. He’d grown bored running OpenTable, a restaurant reservation site, when Marc Andreessen and Ben Horowitz asked if he’d be interested in joining their young firm. The duo asked Jordan to name a hot company in the consumer sector. The first to come to mind was Airbnb. He got the job and the deal. Jordan guided the firm’s $60 million investment in Airbnb, a stake that has grown 30-fold at the private company’s last valuation. Chesky chose Jordan over Andreessen to be an Airbnb board member. “From the first time we met, Jeff struck me as somebody I should learn from,” he says.
Days after becoming an Airbnb director, Jordan proved his mettle. An Airbnb renter vandalized a home, jeopardizing the trust critical for a marketplace among strangers. Airbnb needed a system to make homeowners comfortable. Jordan had introduced a program at eBay called Buyer Protection, which helped resolve issues between buyers and sellers. He advised Chesky to create a property damage protection policy called Host Guarantee that would cover loss or damage by renters up to $50,000, a figure that has since grown to $1 million. Since then Jordan has applied his eBay lessons in advising Airbnb in other ways, including international expansion, adding site functionality, and designing new products, a process Jordan calls “adding layers to the cake” and all steps eBay took.
Jordan claims his investing sweet spot is not a company’s earliest stages but rather when he can see some signs of traction. When he encountered Pinterest in 2011, the company had just reached “product-market fit,” a hallowed Silicon Valley cliché for the moment when a nifty idea finds willing customers. “I do best in investing when there’s a little signal to respond to,” Jordan says. Pinterest already had rapid user growth despite limited marketing. Jordan, says Ben Silbermann, Pinterest’s cofounder and CEO, “saw similarities between Pinterest and the early days of eBay, which had aspects of commerce as well as aspects of community.”
Wisdom and the ability to discern patterns aren’t foolproof, of course, and Jordan found this out the hard way. The same year he invested in Airbnb and Pinterest he also staked an e‑commerce startup called Fab.com. Andreessen Horowitz led the investment round, meaning it put its imprimatur on the deal. It eventually pumped $40 million into the young company. Jordan saw the positive telltale signs of growth: The company’s CEO, Jason Goldberg, said at the time his company was generating $100,000 in online sales per day.
Fab would eventually reach a valuation of almost $1 billion, and then it began to falter. It expanded prematurely into international markets and spent too heavily on marketing. “Cake-layering” and otherwise leveraging a growing user base didn’t work for Fab, and the company sold its assets in 2015 for $15 million.
Jordan, who calls the Fab experience “painful as hell,” feared for his job. He recalls that three other VCs who backed Fab exited their firms soon after. “Boom. Boom. Boom,” he says, forming a finger pistol and loudly firing three bullets. Jordan remembers walking into Andreessen’s office to ask, “Anything I should know?” Andreessen’s response: “Are we still in Airbnb? Are we still in Pinterest? Okay, you can stay.”
After stints at Boston Consulting Group and Stanford Business School, Jordan logged 20 years running companies before he started investing in them. He tried retiring once, but leisure time didn’t suit him. Here are some key stops along the way.
(1990–1998)CFO of The Disney Stores Worldwide
He ultimately was responsible for strategy, finance, and business development for Disney’s retail arm (including the store above), which accounted for about $1 billion in revenue: “This was my first taste of being in an operating business.”
(1999–2006)Senior Vice President and General Manager
Jordan oversaw eBay’s early growth into one of the Internet’s biggest commerce brands. (That’s him holding the “a.”) After eBay bought PayPal, he helped the payments company increase revenue by 39% year over year.
(2007–2011)President and CEO
He led the online reservation company through its initial public offering in 2009 at the height of the financial crisis. On its first trading day, the company’s stock price popped nearly 60%. It increased more than threefold during his tenure.
(2011–Present)Managing Partner
Jordan credits his operating experience for investing early in some of Silicon Valley’s hottest tech companies. They include Airbnb (whose founders are pictured here), Pinterest, Instacart, Lime, Lookout, OfferUp, Accolade, and Wonderschool.
Jordan has knownreal setbacks in his professional and personal life. He grew up in the Philadelphia area, the middle of three children. His father, who worked as a pharmaceutical executive, died of cancer when Jordan was 15. His mother, a homemaker until then, eventually became the family’s sole provider and found a job as an executive assistant. There was enough money for tuition at Amherst College in Massachusetts but not, says Jordan, for living expenses. So he took jobs as a cook at campus restaurants and throughout his summer breaks. (He remains an enthusiastic cook.)
After college, Jordan worked briefly for the insurerCigna, where a boss spotted his ambition and recommended business school. He was accepted at Stanford, where he told the admissions director he couldn’t afford to go. She told him, “You can’t afford not to.” He made it work through a combination of financial aid and student loans. After Stanford and three years at Boston Consulting Group, he joined the venerable strategy group at Disney, where his boss was Meg Whitman.
Despite working for one of the most iconic brands in the country, Jordan answered the siren call of the budding dotcom sector, becoming CEO of online DVD seller Reel.com in 1998. The company was a dud. “That was my huge career failure,” says Jordan. “I mean, it was just a terrible business, and I wanted it to be something that it wasn’t.” He was supposed to take the company public but quit after six months to rejoin Whitman, who was now CEO of eBay.
eBay was tiny when Jordan joined as general manager for North America in 1999. Six years later, the unit had 6,000 people. As a key member of Whitman’s leadership team, Jordan championed the $1.5 billion acquisition of PayPal in 2002. The deal was controversial internally because eBay already owned a payments company called Billpoint. “It was clear Billpoint was an abject failure,” Jordan says. He favored PayPal because eBay users favored it. Jordan later became president of PayPal, and at a time eBay was riding high, he was considered a potential successor to Whitman. But she passed over Jordan and hired John Donahoe, the top executive at Bain & Co., where Whitman had once worked. Jordan, who says he took himself out of the running for the eBay CEO job long before Donahoe entered the picture, quit. And for the first time in his adult life he was out of work.
He considered retirement. “I biked every single mountain path like 50 times, and then when I started doing them for the second time, I said, ‘Okay, it’s time to get a job,’ ” he says. Nine months after leaving eBay, he became CEO of OpenTable, a job his eBay fans considered beneath him. One investor thought it was “such a waste having him at the head of that teeny little-ass business,” Jordan says he was told. Nevertheless, he took OpenTable public and stayed for four years, eventually becoming as restless as a CEO as he’d been as a retiree. “I had started advising companies on the side because I was having fun doing that,” he says. That’s when Andreessen and Horowitz called.
There’s a framedChicago Bulls jersey above a plaque on the wall of Jordan’s Sand Hill Road office that reads:
JORDANA true leader.A role model for other players.Never steals the limelight.Understands the need for teamwork.Never lets adversity get him down.Always practices excellence on the court.And we’re not talking about Michael.Good luck, Jeff.
“That was my going-away present from Disney,” he says. And then he shows his other business trophies: framed charts and graphs from his time at eBay and PayPal. “I joined eBay in 1999,” he says, pointing to the chart. “They did $3 billion in gross merchandise volume the first year I ran it,” referring to eBay’s preferred metric for total commerce conducted on its platform. By the time he left, that number had grown to $19 billion.
Not counting Reel.com, a mistake, and OpenTable, a modest success by the outsize standards of Silicon Valley, Jordan always has played supporting roles. As an executive at Disney and eBay, he had helped contribute to the success of high-profile CEOs like Michael Eisner and Meg Whitman. His name will never be on the door at Andreessen Horowitz.
But he has another measure of success beyond the wealth he accumulated at eBay, OpenTable, and his early wins at Andreessen Horowitz. He calls it his “scorecard,” otherwise known as a personal track record. “My biggest issue is that I don’t like to talk about myself,” he says, while simultaneously noting that he consistently ranks higher than anyone else at Andreessen Horowitz on industry investing lists, a humblebrag of the first order. Indeed, Jordan ranks No. 5 on the most recent CB Insights list of top VCs, a ranking known as more of a quantitative measurement than a popularity contest.
Jordan even wins praise from competitors. “It looks to me that Jeff’s behind some of the firm’s most iconic investments,” says Benchmark’s Bill Gurley. (The two have been allies as well as rivals; Gurley was an OpenTable investor when Jordan ran the company.)
Asked why he’s still at it—digging through company reports, serving on boards, meeting with so many people when he could be off on his own on the trail, Jordan leans forward and says, “It keeps me young.” Later in the day, Jordan joins six Stanford Business School students for lunch to discuss his career and offer advice about theirs. Immediately after finishing his meal and shaking hands with everyone, he’s off to Seattle for a board meeting of OfferUp, an e-commerce company. Prominent VCs at competing firms have recently opted to scale back their investments. Not Jordan, who has re-upped as a partner in Andreessen Horowitz’s newest fund. “I’ll be doing this for a while,” he says.
A version of this article appears in the July 2019 issue of Fortune with the headline “The VC Who’s Seen It All Before.”
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Woman sparks parenting debate after calling for legal document that would enable men to 'opt' out of parenthood
A woman has sparked a debate after asking if dads should be given the option to opt-out of parenthood [Photo: Getty] A woman has sparked a debate online after asking whether men should be able to “opt out” of parenting following an unwanted pregnancy . Taking to parenting site Mumsnet the woman explained that though woman can effectively opt out of motherhood by having an abortion or taking the morning after pill , men don’t have any other choice but to accept the pregnant woman’s decision. The poster went on to ask if there should be a legal option open to men which would detail that he does not want to be part of the child’s life in anyway, won’t be able to seek access and will not pay child support to the mother. By way of an explanation about her reasoning for the need of an opt-out document, the woman gave an example of her friend who had a baby with a man who claimed not to want any involvement while she was pregnant, but later changed his mind. “My friend has a child who was ultimately the result of a very casual, friends with benefits type situation,” she wrote. “The father was immediately sure that he didn't want a baby and told her from the very beginning. “He wasn't around and didn't help out for the first couple of years, but has now decided that he wants to have access to the child and start to build a relationship now he is older.” READ MORE: Dads are losing friends when becoming a father, study reveals The woman went on to say that the situation has caused her friend a lot of upset, and it has lead them both to question whether a legal document could have prevented the situation. “What if there was the option for a man to ‘opt out’ of parenthood?” she posed. “It would, of course, have to be done very early on - before the baby was 1 month old, for example. “Her idea is that this could be done by signing a legal document stating that he has no desire to be a part of the child's life in any way, will not ever be able to seek any type of access, and will not pay money,” she continued. “This move would have to be irreversible in order to be taken seriously. (Perhaps there could be some terms and conditions like the situation can be reversed but only with the mother's permission).” Story continues The original poster goes on to point out that she knows a lot of people will say that if a man doesn’t want a child he shouldn’t have sex or should use contraception, but she believes that this is not necessarily fair. “I believe in total equality between the sexes and feel that this is unfair,” she wrote. “Two people choose to have sex, two people choose whether or not to use contraception, but only one person can decide whether or not they will keep a child if an accident does happen.” The woman suggested there would need to be some regulations to the opt-out document for example if a women can prove that a baby was discussed or planned then the man can't opt out. She finished her post by asking what other users thought about the idea. “I'm really curious about this. On the one hand yes, if you don't want a baby then use contraception. But on the other hand, accidents happen and I can't help but agree with my friend that men should be allowed to opt out just as women can.” Should dads be given the option to opt-out of parenting after an unwanted pregnancy? [Photo: Getty] READ MORE: Mum sparks debate about whether new dads should be able to stay over in maternity wards And Mumsnet users were quick to step in and offer their opinions on the tricky topic. Many disagreed that an opt-out document should exist, claiming that men who don’t want a child should use contraception properly or be more careful. ‘The fact that it is not men bearing children (and accepting the consequent physical, emotional, social and financial costs of pregnancy) is NOT a disadvantage to men. ‘If men don’t want children they can abstain from sex, use condoms or have a vasectomy. That is the point where they get to opt out.’ “But you’re not comparing the same thing,” another user pointed out. “You’re saying ‘women can choose not to continue a pregnancy, therefore men should be able to choose not to fulfil their obligations towards a child that’s already been born’. ”Not interested in arguing for the rights of deadbeat dads to be even more deadbeat, whether or not it’s dressed up as equality. Nope.” “I don't agree with this,” another user shared. “It's far too easy already for men to walk away from their responsibilities - making it even easier is an awful idea. “However, if it was brought in, the 'opt-out' would need to be up to the same point that it's legal to terminate the pregnancy and no later.” But others could see the advantages of having an opt-out system in place. “Yes, they should be able to,” one user wrote. “Too often we hear the tired old ' well he shouldn't have had sex then' but the reality is, they BOTH had sex, knowing the potential consequences. The mother has the option to get rid, he doesn't. “If the woman really, really didn't want a baby, she would do everything to prevent it. There's enough contraception choices freely available,” the user added. “I think I agree,” another commented. “Surely men also deserve to have a say in whether they raise a child? And surely what is best for a child is to be raised by one loving parent then to be constantly disappointed by an absent /disinterested parent?” “I 100% agree that men should be able to opt out just as much as women should be allowed to have abortions unquestioned,” another agreed. “The only issue is the child will be aware their father did not want to be active and some people struggle with the rejection but lots of people feel the same with adoption. “People find it a horrifying crass decision but realistically I believe men have rights too! Women have far too much of the power when it comes to getting pregnant and continuing it to "trap" a man, so if you think about it an official opt out termination of parental responsibility and rights would prevent such women taking tactics like these. Yes most women are not like this but it is reality for a lot all the same.” What do you think? Should men have the option to opt-out of parenthood if they find themselves faced with an unwanted pregnancy? |
James Middleton opens up about ‘crippling’ depression and scrutiny of his success
James Middleton has spoken about his “crippling” depression and being judged on his success. Earlier this year, the Duchess of Cambridge ’s brother spoke candidly about his diagnosis with clinical depression, explaining that he once felt like a “complete failure” due to the condition. Now, the founder of personalised greetings business Boomf said while there was no particular reason for his depression, he could recall feeling guilty for his privileged upbringing. ‘It’s what keeps you in bed, while anxiety makes you feel guilty for being there,” he told Tatler . “I thought ‘What do I have to be depressed about?’ I’ve been so lucky with my upbringing, I had all the things I wanted. “It’s not that I wanted more, but there was something that wasn’t always there... And the more I ignored it, the more it was taking over.” While his parents, Carol and Michael Middleton, knew something “wasn’t right”, the 32-year-old said he felt incapable of talking to them about how he was feeling at the time. View this post on Instagram Sail away with me ⛵️ ☀️ A post shared by James Middleton (@jmidy) on May 7, 2019 at 10:23am PDT The entrepreneur continued: “I shut myself off, I didn’t communicate with my family at all. But there’s only so long you can hold your breath.” Following a period of therapy and time in Glen Affric – his brother-in-law James Matthews’ Scottish estate – Kate’s brother admitted to finally feeling content. “I am happy – I feel like James Middleton again,” he said. “I feel like I was when I was 13, excited about life. I feel like myself again and I couldn’t ask for more.” Elsewhere in the interview, Middleton – who is currently in a relationship with French financial expert Alizee Thevenet – spoke about the pressure of being in the public eye. Pippa Middleton (R) and James Middleton (L), sister and brother of Catherine, Duchess of Cambridge, sit together in the Royal Box on Centre Court on day four of the 2014 Wimbledon Championships at The All England Tennis Club in Wimbledon, southwest London, on June 26, 2014. (Getty Images) Following Kate’s wedding to the Duke of Cambridge in 2011, the then 23-year-old James said that the sudden media attention around him made him question his sense of self, his abilities and his business. Story continues “Suddenly, and very publicly, I was being judged about whether I was a success of a failure,” he said. “That does put pressure on you. Because in my mind I’m doing this irrespective of my family and events that have happened.” On his relationship with the royals, he added: “I lead a separate life to them. “If there’s interest in me, great. If there’s interest in me because of them, that’s different.” In his January essay for the Daily Mail , Middleton described depression as “an absence of feelings” and revealed that his eldest sister’s work with mental health charity Heads Together was partly what inspired him to come forward with his own story of the condition. “I know I’m richly blessed and live a privileged life. But it did not make me immune to depression,” he wrote. “It is tricky to describe the condition. It is not merely sadness. It is an illness, a cancer of the mind.” If you have been affected by any issues mentioned in this article, you can contact The Samaritans for free on 116 123 or any of the following mental health organisations: mind.org.uk nhs.uk/livewell/mentalhealth mentalhealth.org.uk samaritans.org anxietyuk.org.uk The full interview can be seen in the August issue of Tatler , available on newsstands and digital download on Thursday 27 June 2019. |
Gold ETF (IAU) Hits New 52-Week High
For investors seeking momentum,iShares Gold Trust (IAU)is probably on radar now. The fund just hit a 52-week high, and is up 19.2% from its 52-week low price of $11.25 per share.
But are more gains in store for this ETF? Let's take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
IAU in Focus
This ETF is designed to track the spot price of gold bullion. It charges investors 25 basis points a year in fees (see: all Precious Metals ETFs here).
Why the Move?
As the Fed hints at policy easing in 2019, the greenback remains subdued. This is a great scope for the outperformance of the gold bullion ETF IAU. Also, flare-up in geopolitical risks always benefits the safe-haven asset gold. Latest U.S.-Iran tensions thus boosted the yellow metal to a six-year high.
More Gains Ahead?
The fund has a positive weighted alpha of 14.30, which hints at more gains. So, there is definitely still some promise for those who want to ride on this ETF a little longer.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free reportiShares Gold Trust (IAU): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report |
Don't expect debt relief, United States warns Africa
By Joe Bavier
PRETORIA (Reuters) - African countries running up debt they won't be able to pay back, including to China, should not expect to be bailed out by western-sponsored debt relief, the United States' top Africa diplomat warned.
The International Monetary Fund and World Bank began the Heavily Indebted Poor Countries (HIPC) Initiative in 1996 to help the world's poorest countries clear billions of dollars worth of unsustainable debt.
But Africa is facing another potential debt crisis today, with around 40 percent of low-income countries in the region now in debt distress or at high risk of it, according to an IMF report released a year ago.
"We went through, just in the last 20 years, this big debt forgiveness for a lot of African countries," said U.S. Assistant Secretary of State for Africa for African Affairs Tibor Nagy, referring to the HIPC programme.
"Now all of a sudden are we going to go through another cycle of that? ... I certainly would not be sympathetic, and I don't think my administration would be sympathetic to that kind of situation," he told reporters in Pretoria, South Africa, late on Sunday.
Under Donald Trump's administration, the United States has criticised China for pushing poor countries into debt, mainly through lending for large-scale infrastructure projects. It has warned those nations risk losing control of strategic assets if they can't repay the Chinese loans.
Sri Lanka formally handed over commercial activities in its main southern port in the town of Hambantota to a Chinese company in 2017 as part of a plan to convert $6 billion of loans that Sri Lanka owes China into equity.
U.S. officials have warned that a strategic port in the tiny Horn of Africa nation of Djibouti could be next, a prospect the government there has denied.
From 2000 to 2016, China loaned around $125 billion to the continent, according to data from the China-Africa Research Initiative at Washington's Johns Hopkins University School of Advanced International Studies.
And a number of African countries form part of China's $126 billion Belt and Road Initiative to link China by sea and land through an infrastructure network with southeast and central Asia, the Middle East, Europe and Africa.
China has rejected criticism of its lending in Africa. And debt campaigners point to the fact that much of Africa's current debt load consists of commercial debt to western financial institutions or Eurobonds, which are more expensive to service than Chinese loans.
"All of these countries are sovereign states, so it's for them to decide who they want to trade with," Nagy said. "We feel we have an obligation to point out to them when we believe they are getting into severe economic difficulties."
(Reporting by Joe Bavier, editing by Larry King) |
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