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2 Stocks to Buy With Dividends Yielding More Than 3%
It's been a rough five years for shareholders ofRoyal Dutch Shell(NYSE: RDS-A)(NYSE: RDS-B)andInternational Paper(NYSE: IP). The former is one of the leading energy companies on the planet, while the latter has a dominant presence in the pulp and paper industry. Leadership positions have hardly helped the dividend stocks, however, as they've delivered gains of just 7% and 10%, respectively, in the past five years -- and those returns include dividend payments. By comparison, theS&P 500has posted a total return of 67% in that span.
While the recent performance hasn't been great, and both businesses face unique headwinds, investors don't have to spend much time searching for reasons for optimism. Royal Dutch Shell continues to churn out gobs of cash from operations, while International Paper is also a cash cow thanks to its manufacturing prowess when it comes to packaging products. And, of course, the stocks pay out annual dividend yields of 5.7% and 4.6%, respectively.
Here's why investors seeking high-yield income stocks might want to give these two companies a closer look.
Image source: Getty Images.
In recent years, Royal Dutch Shell has been furiously shedding underperforming assets and refocusing on profitable production, not just production volumes. It's working. The business managed to generate $6 billion in net income and $8.6 billion in operating cash flow in thefirst quarter of 2019, despite a relatively choppy period for the oil, gas, and petrochemical markets.
That solid financial performance was enabled by focusing on profitable production of existing acreage, strategic investments in growth projects such asAmerican shaleandliquefied natural gas, and strict financial targets.
It should keep getting better. By 2020, Royal Dutch Shell expects to generate at least $28 billion in annual free cash flow, repurchase $25 billion in shares (dating back to 2018), and earn about 10% returns on average capital employed (ROACE). That could improve to $35 billion in annual free cash flow and over 12% ROACE by 2025.
If the business hits the mark, then it expects to deliver over $125 billion in dividends and share repurchases to investors in the five-year period ending 2025 -- and that assumes crude oil prices average $60 per barrel. To put that level of operating efficiency into perspective, consider that Royal Dutch Shell returned just $52 billion to shareholders in the five-year period ending 2015, when oil prices averaged $97 per barrel.
Simply put, this oil supermajor is on the path to significantly reducing the risk of volatile energy prices, which would allow substantial distributions of cash to shareholders and investments in the future, including gas and electric utility infrastructure. That makes Royal Dutch Shell a blue-chip dividend stock for any portfolio.
Image source: Getty Images.
International Paper distributes $2 per share to stockholders per year, which is nearly double the amount returned in 2012 and represents an annual dividend yield of 4.6%. Unfortunately, a strong track record of paying healthy dividends to investors is overshadowed by the fact shares have lost 11% in the past five years when dividend distributions are excluded from returns.
What's going on? Wall Street has soured on the company and the pulp and paper industry more broadly over concerns that the ongoing trade war between the United States and China will weigh on the business, as China has become an important market for engineered paper products in recent years. While there are headwinds, the fears appear to have been overblown.
International Paper has navigated trade risks by doubling down on operating an efficient, global fleet of containerboard manufacturing facilities. That helped the businessdeliver $5.6 billion in revenue in Q1 2019, identical to the year-ago level, while net income from continuing operations jumped 18% in that span. That strong performance gives management confidence the business will generate $2 billion in free cash flow in 2019.
Investors might be confident, too, that the pulp and paper leader is well-positioned to capitalize on trends ranging from growing e-commerce sales (a significant driver in cardboard demand) and the desire to swap plastic packaging with paper alternatives. Given that, and the fact that the stock trades at just 8.7 times estimated earnings, investors looking for income should give International Paper a closer look.
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MGM Resorts or Las Vegas Sands: Which is Worth the Gamble?
Operators of integrated casino, hotel and entertainment resorts seldom fail to build businesses as demand for casino services is relatively inelastic. This is because casinos attract a particular set of consumers, whose preferences remain more or less similar despite adverse market conditions. In addition to this, the legalization of sports betting outside Nevada widened the scope for casino operators since illegal betting is valued at billions of dollars annually in the United States. Further, casino operators are collaborating with the hospitality sector, setting up luxury hotels and generating high-margin non-gaming revenues. But it is not prudent to think that the industry has no hurdles to combat. An ongoing trade war between Washington and Beijing is continuously hurting casino stocks. Moreover, increased hotel openings and promotional activities made Las Vegas and Macao markets highly competitive. Thus, excess supply, especially in the Macao market, is a challenge for individual casino providers. Also, the industry is infested with high debt levels. Amid such a backdrop, leading casino companies like Wynn Resorts WYNN, Penn National Gaming, Inc. PENN, Las Vegas Sands Corp. LVS and MGM Resorts International MGM are continuously devising strategies to drive revenues and profits. In response to a rapidly evolving and dynamic market, Las Vegas Sands and MGM Resorts are capitalizing on the significant profit associated with the business. The companies currently carry a Zacks Rank #3 (Hold) and have respective market capitalization of $45.8 billion and $14.9 billion. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here . Let us find out which stock is set to serve better returns to investors. Price Performance and Earnings & Revenue Estimates Arguably, earnings growth is of the utmost importance for determining a stock’s potential as surging profit levels indicate solid prospects (and stock price gains). For 2019, Las Vegas Sands’ earnings are expected to grow 9%. Moreover, it is expected to witness year-over-year sales growth of 2.2% in 2019. MGM Resorts’ 2019 earnings are likely to decline 2% while sales are likely to improve 10.9%. In the past year, Las Vegas Sands’ shares have declined 21.9% while MGM Resorts’ shares lost 5.4%. Meanwhile, the industry recorded collective decline of 21.2%. Valuation Since casino stocks are debt-laden, it makes sense to value those based on the EV/EBITDA (Enterprise Value/ Earnings before Interest Tax Depreciation and Amortization) ratio. This is because the valuation metric takes into account not just its equity but also the level of debt on a company’s balance sheet. For capital-intensive companies, the EV/EBITDA is a better valuation metric because it is unaffected by changing capital structures and ignores effects of non-cash expenses on a company’s value. The trailing 12-month EV/EBITDA ratio of MGM Resorts is 10.14 while that of Las Vegas Sands is 10.33. With the industry average being 12.22x, MGM Resorts has an edge over Las Vegas Sands. Story continues Debt Ratio Since the sector has high financial leverage, the debt-to-asset ratio comes into the picture. Excessive reliance on debt financing is a concern for both companies. As of Mar 31, 2019, cash and cash equivalents were $1.2 billion, whereas long-term debt of $14.7 billion was much higher. For Las Vegas Sands, unrestricted cash balance was $4.13 billion as of Mar 31, 2019. Total debt outstanding, including the current portion and net of deferred financing costs, along with original issue discount, summed $11.98 billion. By looking at debt-to-asset ratio, we can have a sense of a company’s ability to meet its long-term debt. Leisure stocks should ideally have lower debt ratios, which means there will be higher proportion of the company’s assets over the long term. Las Vegas Sands’ debt ratio is 53.8 compared with the industry’s 56.5 and MGM Resorts’ 47.3. Return on Equity & Net Margin Las Vegas Sands delivered a return on equity (ROE) of 34.5% in the trailing 12 months compared with 5.2% growth recorded by the industry. MGM Resorts’ ROE is 4%. This indicates that Las Vegas Sands reinvests more efficiently than MGM Resorts. Traditionally, gross margin for the hospitality companies is comparatively higher as the majority of expenses come from the cost of operations. However, the sector’s profits are not very high, which is evident from the net profit margin or net margin. The industry’s trailing 12-month net margin is 2.2% while that of Las Vegas Sands and MGM Resorts’ is 11.2% and 2.3%, respectively. Bottom Line While Las Vegas Sands’ projected earnings and margins are more promising than MGM Resorts’, the latter’s debt ratio is encouraging. Please take a look at the following table to compare the two gaming giants. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020. Click here for the 6 trades >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report MGM Resorts International (MGM) : Free Stock Analysis Report Wynn Resorts, Limited (WYNN) : Free Stock Analysis Report Las Vegas Sands Corp. (LVS) : Free Stock Analysis Report Penn National Gaming, Inc. (PENN) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research View comments |
Does The Odfjell Drilling Ltd. (OB:ODL) Share Price Tend To Follow The Market?
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If you're interested in Odfjell Drilling Ltd. (OB:ODL), 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 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 are more sensitive to general market forces than others. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
View our latest analysis for Odfjell Drilling
Given that it has a beta of 1.33, we can surmise that the Odfjell Drilling share price has been fairly sensitive to market volatility (over the last 5 years). If this beta value holds true in the future, Odfjell Drilling shares are likely to rise more than the market when the market is going up, but fall faster when the market is going down. Beta is worth considering, but it's also important to consider whether Odfjell Drilling is growing earnings and revenue. You can take a look for yourself, below.
Odfjell Drilling is a small company, but not tiny and little known. It has a market capitalisation of øre5.8b, which means it would be on the radar of intstitutional investors. It has a relatively high beta, which is not unusual among small-cap stocks. Because it takes less capital to move the share price of a smaller company, actively traded small-cap stocks often have a higher beta that a similar large-cap stock.
Since Odfjell Drilling tends to moves up when the market is going up, and down when it's going down, potential investors may wish to reflect on the overall market, when considering the stock. In order to fully understand whether ODL is a good investment for you, we also need to consider important company-specific fundamentals such as Odfjell Drilling’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 ODL’s future growth? Take a look at ourfree research report of analyst consensusfor ODL’s outlook.
2. Past Track Record: Has ODL 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 ODL's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how ODL 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. |
Implied Volatility Surging for NewLink Genetics (NLNK) Stock Options
Investors inNewLink Genetics CorporationNLNK need to pay close attention to the stock based on moves in the options market lately. That is because the Jul 19, 2019 $3.00 Call had some of the highest implied volatility of all equity options today.What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy.What do the Analysts Think?Clearly, options traders are pricing in a big move for NewLink Genetics shares, but what is the fundamental picture for the company? Currently, NewLink Genetics is a Zacks Rank #2 (Buy) in the Medical – Biomedical and Genetics industry that ranks in the Top 26% of our Zacks Industry Rank. Over the last 30 days, the Zacks Consensus Estimate for the current quarter has narrowed from a loss of 30 cents per share to a loss of 29 cents.Given the way analysts feel about NewLink Genetics right now, this huge implied volatility could mean there’s a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected.Looking to Trade Options?Each week, our very own Dave Bartosiak gives his top options trades. Check out his recent live analysis and options trade for the NFLX earnings report completely free. See it here: Bartosiak: Trading Netflix's (NFLX) Earnings with Options or check out the embedded video below for more details:
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 reportNewLink Genetics Corporation (NLNK) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
The Three Big Reasons to Buy Alibaba Stock Before the Trade War Ends
Shares of Chinese technology giantAlibaba(NYSE:BABA) have struggled over the past 18 months as investors have tried to grapple with slowing growth across China’s economy and rising trade tensions between the U.S. and China, which threaten to accelerate the already naturally occurring China economic slowdown. Despite those big macroeconomic risks, the Alibaba stock growth narrative has remained resilient and healthy.
Source:Charles Chan Via Flickr
Indeed, the company has continued to fire off big revenue growth quarter after big revenue growth quarter.
As such, the bull-bear debate on BABA stock has smart people on both sides. Bulls are saying Alibaba remains a big growth company that is being unfairly knocked down by trade war risks, which the company has proven largely resilient to. Bears are saying Alibaba is a slowing growth company that will continue to slow as those trade war risks build up.
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I think the bulls are right on this one, for three big reasons:
Alibaba is a high-quality growth story that has enough secular growth tailwinds behind it to offset the mildly slowing economic expansion in China. The economic slowdown in China is overstated, and China’s digital economy is still rapidly expanding. Alibaba stock is far too cheap considering its robust long term growth prospects.
All in all, the bull thesis on BABA stock at this point in time looks pretty compelling. You have a high-quality growth stock, at the epicenter of a secular growth market, trading at a discounted valuation because of overstated slowdown concerns. That combination ultimately makes BABA stock look like a good buy here and now.
First, and foremost, Alibaba is a high-quality growth story that has enough secular growth tailwinds behind it to offset the mildly slowing economic expansion in China.
For all intents and purposes, Alibaba is the heartbeat of China’s digital economy. The company operates the country’s largest e-commerce platform, as well as the country’s largest cloud business. That puts Alibaba at the intersection of two huge secular growth tailwinds – the rapid migration of commerce from the physical to digital channel, and the rapid migration of enterprise workloads from on-premise to cloud solutions.
Those two secular growth tailwinds have been enough to offset the mildly slowing economic expansion in China. Although China’s economy grew by just 6.6% in 2018 (the lowest rate in 28 years), Alibaba reported revenue growth last year and last quarter of over 50%. For the past several quarters, revenue growth has hovered in the 50-60% range. Thus, despite the slowing economic expansion in China, Alibaba has maintained its red hot growth trajectory.
Net-net, it’s safe to say that Alibaba is supported by secular tailwinds strong enough to keep this company on a winning trajectory for the foreseeable future.
Second, it’s equally important to understand that China economic slowdown concerns are broadly overstated and that China’s digital economy is still rapidly expanding.
This starts with understanding that China’s economy is slowing from a sky-high growth pace. China’s economy did grow at its slowest pace in 28 years last year. But, the GDP growth rate was still 6.6%. The U.S. economy hasn’t printed a GDP growth rate above 6% since 1984. In other words, while China’s economy is slowing, it’s still growing at what would be a 35-year high rate for the U.S.
Further, China’s digital and consumer economies still remain hugely under-penetrated relative to the digital and consumer economies of developed countries. China’sGDP per capita,income per capita, andexpenditures per capitaare all just a fraction of what they are in developed countries like Germany, the UK, and the U.S.
By a fraction, I mean 10-25%, so very small relatively speaking. Further, China’s internet penetration rate isjust 60%. Across North America and Europe, internet penetration rates are closing in on 90%.
Broadly, then, China’s digital and consumer economies remain hugely under-penetrated and have a long runway ahead to keep expanding. That’s why China’s ecommerce sales are expected to rise at a15%-plus ratefor the next several years. Alibaba is the heartbeat of that ecommerce market, and as such, finds itself at the epicenter of a still red-hot secular growth market.
Third, it’s important to understand just how cheap BABA stock is relative to its long term growth potential.
Alibaba is a 50%-plus revenue growth company. Across the entire China internet landscape, you’d be hard pressed to find a company that has consistently grown revenues at a 50%-plus pace for the past several quarters.
The only other name that comes to mind isBilibili(NASDAQ:BILI). The difference? Bilibili is expected to do revenues of less than $1 billion this year. Alibaba’s projected sales this year measure over $70 billion.
Thus, Alibaba is an unparalleled combination of big growth and big size. This big growth should persist given the company’s secular growth ecommerce and cloud tailwinds. Also, Alibaba is at the epicenter of the rapidly expanding China digital economy.
Margins are starting to stabilize after several quarters of compression. Big growth-related investments are fading out and paying off. This dynamic will persist. Continued big revenue growth over the next several years should be accompanied by healthy margin expansion.
Net-net, I see Alibaba as a 20% revenue grower over the next several years, with profit margins that should gradually expand from today’s depressed base. Ultimately, that paves a visible pathway for EPS to run towards $20 by fiscal 2026.
Based on a market average 16 forward multiple, that equates to a fiscal 2025 price target for Alibaba stock of $320. Discounted back by 10% per year, that implies a fundamentally supported fiscal 2020 price target of roughly $200.
Alibaba is a high-quality growth story at the epicenter of a secular growth market. That positioning gives the company tremendous long term profit growth potential. Alibaba stock presently trades at a discount to that big profit growth potential.
The result? Big growth will eventually and inevitably converge on a discounted valuation. When it does, BABA stock will fly towards $200.
As of this writing, Luke Lango was long BABA and BILI.
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This top-rated fast wireless charger is somehow only $6.99 right now on Amazon
I don’t care what smartphone you use… if it supports wireless charging, there’s a deal on Amazon right now that you definitely need to take advantage of. The PeohZarr Qi-Certified 10W Fast Wireless Charger is one of the best-rated wireless chargers on Amazon. It supports three different wireless charging speeds — standard 5W charging, 7.5W fast wireless charging for iPhones, and 10W fast wireless charging for Samsung and other Android phones — and it also has a nifty feature that stops the charging indicator light from glowing after a few seconds so it doesn’t bug you while you’re sleeping. Our readers flock to this awesome wireless charger by the hundreds when it goes on sale for $10, and right now it’s on sale for an all-time low of $6.99. Hurry! Here are the highlights from the product page: Related Stories: A best-selling cookbook with 500 Instant Pot recipes is on sale for $3.99 right now Best Jump Rope How on Earth is Amazon's best-selling surround sound system down to $59.99 right now? 【TOP SPEED & QI CERTIFIED】With the specially-designed chip and latest power solution, This wireless charger has ever a remarkable charging efficiency up to 85%, 20%-30% higher than regular chargers. 【10W, 7.5W, 5W CHARGING MODES】10W fast charge mode for Samsung, 7.5W fast charge mode for iPhone, 5W mode for all Qi-enabled devices. Fast charge requires QC 2.0/3.0 adapter (Not Included) 【NEVER HEAT UP】The built-in chip of wireless phone charger and porous design provides temperature control, never worry about overheated temperature will damage your phone battery. 【MULTIPLE PROTECTIONS】With our innovative tech, any abnormal condition like over-voltage and short-circuit can be detected, corresponding measures will be taken to protect your phone 100% safe. 【SLEEP FRIENDLY】 The LED of the Qi charger breathes 5 times at the beginning and then stays off, no reminder after fully charged either, this design brings you a soundly sleep without any disturb. 【NO RISK FOR YOUR MONEY】You will get a 3-year warranty and 1-year no questions asked money back guarantee. Feel free to contact us if you have any request, we will solve your problem within 24 hours! 【READ USER MANUAL CAREFULLY】Incorrect methods you place device on the wireless charging pad might lead to heating of the charger and flash of indicator all the time. Manual will help you. 【CARRY IT TO TRAVEL】With 2.36oz weight and compact body. It is easy to take the Qi fast charger to everywhere. Its surface is anti-scratch. Feel free to put it in your pocket or bag with no worries. 【QUALITY IS MORE IMPORTANT THAN PRICE】 We will not sacrifice quality for price! Every part of our 10W wireless charger is made of selected superb materials. You will prefer quality to price, right? 【ANTI-SLIP DESIGN】Both sides feature anti-slip design. Neither would it slip from your desk, nor would your phone slip off from the wireless charging pad. Totally no worry about your device. Story continues BGR Top Deals: 10 deals you don’t want to miss on Sunday: $8 wireless charger, $79 soundbar, AirPods 2 and iPad deals, more Dash’s awesome compact air fryer is back down to $39.99 today Trending Right Now: Everything new coming to Netflix this week, and everything leaving (week of June 23) New trailers you need to watch from this week: Spider-Man, Point Blank, and more Samsung’s deepfake technology is getting scary See the original version of this article on BGR.com |
Coinbase CEO Praises Privacy While Allegedly Blacklisting Anonymous Transactions
Co-founder and CEO of majorU.S.-basedcryptocurrency exchangeCoinbaseBrian Armstrongattracted criticism after praisingprivatecryptotransactions in a tweetpublishedon June 22.
In the aforementioned tweet, Armstrong notes that “a scalable, sufficientlydecentralized, chain that supported private transactions by default (privacy coins) would be a game changer.” He then comparesanonymouscryptocurrency transactions to cryptography on the web, pointing out that it is increasingly predominant. He also used messaging as an example:
“Same with messaging, end to end encryption started out fringe and is now the expected default.”
Armstrong also cited the recentnewsabout the Electric Coin Company (ECC), the firm behind second-biggest anoncoin zcash (ZEC), intending to build a new scalable zcashblockchainas an example of privacy by default. In response, Luke Dashjr raised a question towards what he perceives to be an unclear stance on privacy on Coinbase’s part:
“Why does @Coinbase seem to blacklist people who might get their coins from certain sources, if you support privacy? I'm a bit confused...”
To which bitcoin core developer answered stating that — according to him — as long as it is possible to distinguish “dirty” coins, the exchange is forced to block them. Self-proclaimed bitcoin (BTC) maximalistGiacomo Zuccostepped in disagreeing:
“Complete nonsense. They can distinguish ‘privacy coins’ better than they can distinguish bitcoins from coinjoins. [...] If they are forced to blacklist CJs, they'll be forced to blacklist ‘privacy coins.’”
Then, when a different user asked whether Coinbase blocks CoinJoin transactions, Zuccoclaimed“Of course. And (the very few and low-anonymity set anyway) shielded Zcash txs.” According to apostpublished by the exchange in late November 2018, Coinbase does not fully support zcash shielded addresses:
“Initially, we will support deposits from both transparent and shielded addresses, but only support withdrawals to transparent addresses. In the future, we’ll explore support for withdrawals to shielded addresses in locations where it complies with local laws.”
As of press time, Coinbase, Giacomo Zucco and several representatives of zkSNACKs, the company behind CoinJoin-enabled BTC wallet Wasabi wallet, have not responded to Cointelegraph’s inquiry. As a consequence, it has not been confirmed whether Coinbase is blocking CoinJoined BTCs.
As Cointelegraphreportedat the time, data provided by zkSNACKs CTO Adam Fiscor revealed at the end of April that mixed bitcoin transactions now represent 4.09% of the total afterCoinJoinshave risen by 300% in the space of nine months.
As a recent Cointelegraph analysisexplains, bitcoin’s increasing anonymity is considered a threat to privacy-focused coins by some.
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With EPS Growth And More, PaySign (NASDAQ:PAYS) Is Interesting
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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 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.
So if you're like me, you might be more interested in profitable, growing companies, likePaySign(NASDAQ:PAYS). While that doesn't make the shares worth buying at any price, you can't deny that successful capitalism requires profit, eventually. Conversely, a loss-making company is yet to prove itself with profit, and eventually the sweet milk of external capital may run sour.
See our latest analysis for PaySign
Over the last three years, PaySign 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 wedge-tailed eagle on the wind, PaySign's EPS soared from US$0.042 to US$0.066, in just one year. That's a impressive gain of 58%.
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. PaySign maintained stable EBIT margins over the last year, all while growing revenue 56% to US$26m. That's progress.
In the chart below, you can see how the company has grown earnings, and revenue, over time. To see the actual numbers, click on the chart.
Fortunately, we've got access to analyst forecasts of PaySign'sfutureprofits. You can do your own forecasts without looking, or you cantake a peek at what the professionals are predicting.
Many consider high insider ownership to be a strong sign of alignment between the leaders of a company and the ordinary shareholders. So we're pleased to report that PaySign insiders own a meaningful share of the business. Actually, with 46% of the company to their names, insiders are profoundly invested in the business. I'm reassured by this kind of alignment, as it suggests the business will be run for the benefit of shareholders. And their holding is extremely valuable at the current share price, totalling US$277m. Now that's what I call some serious skin in the game!
It's good to see that insiders are invested in the company, but are remuneration levels reasonable? Well, based on the CEO pay, I'd say they are indeed. For companies with market capitalizations between US$200m and US$800m, like PaySign, the median CEO pay is around US$1.8m.
The PaySign CEO received total compensation of just US$875k 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. While the level of CEO compensation isn't a huge factor in my view of the company, modest remuneration is a positive, because it suggests that the board keeps shareholder interests in mind. I'd also argue reasonable pay levels attest to good decision making more generally.
For growth investors like me, PaySign's raw rate of earnings growth is a beacon in the night. If that's not enough, consider also that the CEO pay is quite reasonable, and insiders are well-invested alongside other shareholders. This may only be a fast rundown, but the takeaway for me is that PaySign is worth keeping an eye on. Of course, profit growth is one thing but it's even better if PaySign is receiving high returns on equity, since that should imply it can keep growing without much need for capital.Click on this link to see how it is faring against the average in its industry.
Although PaySign certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Breakthrough in U.S. Marijuana Industry: 5 Likely Gainers
In a significant development, the U.S. House of Representatives voted in favor of several amendments to protect cannabis users in legal states. These amendments will prohibit federal agencies, especially the Department of Justice, from interfering with cannabis programs, individuals and businesses in legal states.The amendments won approval from the U.S. House Rules Committee and are heading for a voting on the House floor later this week. The measure would need approval in Senate after getting full House vote. The committee also instructed the FDA to regulate CBD products as conventional foods and dietary supplements.Marijuana Industry is BloomingThe marijuana industry has strong potential especially after its legalization for recreational and medicinal use. Moreover, the industry is enjoying benefits of expansion into other industries like food, beverage, tobacco and cosmetics.On May 31, the FDA held its first hearing to take a decision on whether companies can add CBD, a non-intoxicating cannabis compound, to food, beverages and dietary supplements. Several CBD manufacturers, researchers, farmers and retailers have urged the regulatory authority to allow the use of cannabis. In this regard, the FDA’s approval of CBD-based drug Epidiolex was a major achievement for the industry.On Mar 28, the House Financial Services Committee voted 45-15 in favor of passing the Secure and Fair Enforcement Banking Act of 2019 or the SAFE Banking Act. The bill seeks to safeguard the process of financial lending to cannabis companies in the United States.This bill would not only protect the industry’s credit lines, but also aid cannabis ancillary industries in the country. The ancillary sector has been suffering from financial uncertainties associated with the legal status of marijuana in the past.Cannabis is getting approval from many U.S. states for recreational uses, in addition to medical usage. Though pot remains entirely illegal at the federal level, currently 47 U.S. states offer some form of legalized marijuana for sale.Strong Market PotentialAccording to Arcview Market Research’s annual report --- "The State of Legal Cannabis Markets" --- the global cannabis market size is likely to reach $15 billion this year, implying a gain of 36% year over year. The report evaluates "total cannabinoid market," including sales of medical and recreational cannabis at dispensaries, hemp-derived products in CBD (non-psychoactive cannabidiol) and the U.S. FDA approved CBD-based pharmaceuticals.As per MGO|ELLO Alliance, investment in U.S cannabis industry reached $1.3 billion in the first half of 2019. Per Arcview Market Research and BDS Analytics, cannabis sales in dispensaries, retail stores and pharmacies are likely to grow nearly $45 billion globally by 2024. Of this, CBD products are likely to command $20 billion is sales in 2024.Research firm Cowen projected that the market size of the U.S. legal cannabis industry will reach $75 billion in by 2030. According to Barclays, the U.S. cannabis market would be $28 billion if legalized in 2019, and grow to $41 billion by 2028.Likely GainersThe marijuana industry is considered extremely volatile. Most of these companies are in their early stages of development and characterized as risky for investors. However, cannabis stocks are solid long-term bets. Of these, stocks with a Zacks Rank #3 (Hold) or better and having solid long-term growth potential are worth trying out despite the latent risks. We have narrowed down our search to five such stocks.The chart below shows price performance of our five picks year to date.
Canopy Growth Corp.CGC engages in growing, possession, and sale of medical cannabis in Canada. Its products include dried flowers, oils and concentrates, softgel capsules and hemps. The stock carries a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.The company has an expected earnings growth rate of 45.2% and 72.3% for the current quarter and current year, respectively. The Zacks Consensus Estimate for the current quarter and current year has improved 5.6% and 4.3%, respectively, over the last 60 days. The stock has surged 49.5% year to date.GW Pharmaceuticals plcGWPH is a biopharmaceutical company, focusing on discovering, developing, and commercializing cannabinoid prescription medicines using botanical extracts derived from the Cannabis plant. The stock carries a Zacks Rank #2.The company has an expected earnings growth rate of 89.7% and 90.8% for the current quarter and next year, respectively. The Zacks Consensus Estimate for the current quarter and next year has improved 94.5% and 41.2%, respectively, over the last 60 days. The stock has surged 78.3% year to date.The Scotts Miracle-Gro Co.SMG is the world’s leading marketer of branded consumer lawn and garden as well as hydroponic growing products especially pot. In April 2018, the company acquired hydroponic equipment maker Sunlight Supply to enter into the pot business. The stock carries a Zacks Rank #2.The company has an expected earnings growth rate of 16% and 16.7% for the current quarter and current year, respectively. The Zacks Consensus Estimate for the current year has improved 2.4% over the last 60 days. The stock has surged 59% year to date.Cronos Group Inc.CRON engages in investment in firms that are licensed to produce and sell medical marijuana pursuant to Canada's Marihuana for Medical Purposes Regulations. The stock carries a Zacks Rank #3. The company has an expected earnings growth rate of 137.5% for the current year. The Zacks Consensus Estimate for the current year has improved 200% over the last 60 days. The stock has surged 53.4% year to date.Aurora Cannabis Inc.ACB produces and distributes medical cannabis products. It is vertically integrated and horizontally diversified across various segments of the cannabis value chain. The stock carries a Zacks Rank #3. The company has an expected earnings growth rate of 85% for the next year. The Zacks Consensus Estimate for the next year has improved 50% over the last 60 days. The stock has surged 47.2% year to date.More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportGW Pharmaceuticals PLC (GWPH) : Free Stock Analysis ReportThe Scotts Miracle-Gro Company (SMG) : Free Stock Analysis ReportCronos Group Inc. (CRON) : Free Stock Analysis ReportAurora Cannabis Inc. (ACB) : Free Stock Analysis ReportCanopy Growth Corporation (CGC) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Forget Bargain Hunting: Tap 5 Stocks With Rising P/E
Bargain hunting or looking for stocks with a low price-to-earnings (P/E) ratio is among the widely used investing strategies. Investors believe that the lower the P/E, the higher will be the value of the stock. The logic is simple — a stock’s current market price does not justify its higher earnings and therefore leaves room for upside.
But there is more to this whole P/E story as not only low P/E, stocks with a rising P/E can also fetch solid returns.
Rising P/E: An Useful Tool
Generally, the price of a stock rallies on a rise in earnings. As forecasts for expected earnings move higher, demand for the stock should drive its price. After all, astock's P/E gives an indication of how much investors are ready to shell out for every dollar of earnings. Thus, if the P/E of a stock is rising steadily, it means that investors are pinning their hopes on the company’s inherent strength.
Also, studies have revealed that stocks have seen their P/E ratios jump over 100% from their breakout point in the cycle. So, if you can pick stocks early in their breakout cycle, you can end up seeing considerable gains.
The Winning Strategy
In order to shortlist stocks that are exhibiting an increasing P/E, we chose the following as our primary screening parameters.
EPS growth estimate for the current year is greater than or equal to last year’s actual growth
Percentage change in last year EPS should be greater than or equal to zero
(These two criteria point to flat earnings or a growth trend over the years.)
Percentage change in price over four weeks greater than the percentage change in price over 12 weeks
Percentage change in price over 12 weeks greater than percentage change in price over 24 weeks
(These two criteria show that price of the stock is increasing consistently over the said timeframes.)
Percentage price change for four weeks relative to the S&P 500 greater than the percentage price change for 12 weeks relative to the S&P 500
Percentage price change for 12 weeks relative to the S&P 500 greater than the percentage price change for 24 weeks relative to the S&P 500
(Here, the case for consistent price gains gets even stronger as it displays percentage price changes relative to the S&P 500.)
Percentage price change for 12 weeks is 20% higher than or equal to the percentage price change for 24 weeks, but it should not exceed 100%
(A 20% increase in the price of a stock from the breakout point gives cues of an impending uptrend. But a jump of over 100% indicates that there is limited scope for further upside and that the stock might be due for a reversal.)
In addition, we place a few other criteria that lead us to some likely outperformers.
Zacks Rank less than or equal to 2:Only companies with a Zacks Rank #1 (Strong Buy) or 2 (Buy) can get through.
Average 20-day Volume greater than or equal to 50,000:High trading volume implies that the stocks have adequate liquidity.
Just these few criteria narrowed down the universe from over 7,700 stocks to just 31.
Here are five of the 31 stocks:
Crocs Inc. (CROX):This is a world leader in innovative casual footwear for men, women and children. The stock sports a Zacks Rank #1. You can seethe complete list of today’s Zacks #1 Rank stocks here.
Brinker International Inc. (EAT):Zacks Ranked #2 Brinker International is one of the world's leading casual dining restaurant companies. It belongs to a top-ranked Zacks sector (top 40%).
Shoe Carnival Inc. (SCVL):This Zacks Rank #2 company is one of the nation's largest family footwear retailers. It comes from a top-ranked Zacks industry (top 29%).
AbbVie Inc. (ABBV):It is a global, research-based biopharmaceutical company with a Zacks Rank #2. The stock belongs to a top-ranked Zacks industry (top 17%).
Criteo S.A. (CRTO):Criteo SA is a global technology company that specializes in performance display advertising. It has a Zacks Rank #1 and hails from a top-ranked Zacks industry (top 23%).
You can get the rest of the stocks on this list by signing up now for your 2-week free trial to the Research Wizard and start using this screen in your own trading. Further, you can also create your own strategies and test them first before taking the investment plunge.
The Research Wizard is a great place to begin. It's easy to use. Everything is in plain language. And it's very intuitive. Start your Research Wizard trial today. And the next time you read an economic report, open up the Research Wizard, plug your finds in, and see what gems come out.
Click here to sign up for a free trial to the Research Wizard today.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
Disclosure: Performance information for Zacks’ portfolios and strategies are available at:https://www.zacks.com/performance.
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 reportCriteo S.A. (CRTO) : Free Stock Analysis ReportAbbVie Inc. (ABBV) : Free Stock Analysis ReportShoe Carnival, Inc. (SCVL) : Free Stock Analysis ReportBrinker International, Inc. (EAT) : Free Stock Analysis ReportCrocs, Inc. (CROX) : Free Stock Analysis ReportTo read this article on Zacks.com click here. |
Car trash to cash: U.S. firm aims to power European stadiums with old car batteries
By Lefteris Karagiannopoulos
OSLO (Reuters) - U.S. industrial conglomerate Eaton, which uses second-hand Nissan electric vehicle batteries to power buildings, is in talks with up to six European football stadiums to help power their facilities, according to a senior executive.
Eaton, a New York-listed firm that makes hydraulics, truck transmissions and other industrial products, says the market is niche but expects it to grow up to 20 times between now and 2022.
In Europe, Middle East, and Africa, Eaton estimates the potential market value to be $2.3 billion by 2025.
What to do with the used batteries of electric vehicles is becoming a growing concern as their use expands with that of electric cars, which accounted for 1.5% of the 86 million cars sold globally last year, according to researchers JATO Dynamics.
Eaton takes the cells from the batteries of Japanese carmaker Nissan's returned Leaf electric vehicles and repackages them into new units, a product it calls xStorage, to store power in buildings, both industrial and residential.
It has already equipped the Netherlands' Johan Cruyff Arena, the legendary home of the Ajax football team, among other buildings, with what it calls "second-life batteries". Its latest project was in Oslo's Bislett athletics stadium in Norway, which is partly powered by solar panels.
"The football stadium community is interested. From significant ones, (we are talking) with 5-6 stadiums in Europe." Eaton's senior-vice president Craig McDonnell said in an interview on the sidelines of a presentation at Bislett stadium.
With the exception of Tesla which it sees as a competitor in the storage business, the firm is also talking with other automakers to expand its offering. McDonnell declined to give names.
Eaton says its xStorage solution is 20% cheaper than a new battery and every Nissan Leaf car can produce four such units.
It is among the large-scale commercial ones in the developing market, with other projects run by German automaker BMW which supplies second-hand batteries from its i3 electric vehicles to store wind-farm produced electricity.
(Reporting by Lefteris Karagiannopoulos, editing by Gwladys Fouche and Emelia Sithole-Matarise) |
Did You Manage To Avoid Bank OZK's (NASDAQ:OZK) 38% Share Price Drop?
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Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. That downside risk was realized byBank OZK(NASDAQ:OZK) shareholders over the last year, as the share price declined 38%. That falls noticeably short of the market return of around 6.6%. At least the damage isn't so bad if you look at the last three years, since the stock is down 18% in that time. There was little comfort for shareholders in the last week as the price declined a further 3.6%.
View our latest analysis for Bank OZK
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
Unfortunately Bank OZK reported an EPS drop of 8.0% for the last year. This reduction in EPS is not as bad as the 38% share price fall. So it seems the market was too confident about the business, a year ago. The less favorable sentiment is reflected in its current P/E ratio of 9.11.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. Dive deeper into the earnings by checking this interactive graph of Bank OZK'searnings, revenue and cash flow.
We'd be remiss not to mention the difference between Bank OZK'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. Its history of dividend payouts mean that Bank OZK's TSR, which was a 36%dropover the last year, was not as bad as the share price return.
Investors in Bank OZK had a tough year, with a total loss of 36% (including dividends), against a market gain of about 6.6%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 0.9% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. If you want to research this stock further, the data on insider buying is an obvious place to start. You canclick here to see who has been buying shares - and the price they paid.
There are plenty of other companies that have insiders buying up shares. You probably donotwant to miss thisfreelist of growing companies that insiders are buying.
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. |
Scamp the Tramp named the world's 'ugliest dog'
Scamp The Tramp is seen on stage after being announced the winner of the World's Ugliest Dog Competition in Petaluma, California on June 21, 2019. (AFP) Matted fur, a lolloping tongue - this is the worlds ugliest dog. Scamp the Tramp was crowned winner at the event in Petaluma, California, after being declared uglier than his 18 competitors. A former stray with a messy mane that "no amount of conditioner can calm," his owner, Yvonne Morones, said that she rescued Scamp the mongrel at the "last hour" from a Los Angeles animal shelter and has no regrets about the way it's all turned out. Last year the contest was won by Zsa Zsa, an English bulldog . "It was on the way home that I knew I made the right choice," Morones said. "There we were, two strangers in a car on the way home to a new start ... It was like he knew he had found his forever home." TOPSHOT - Darlene Wright holds up Scamp the Tramp as it is announced that he won first prize in the World's Ugliest Dog Competition in Petaluma, California on June 21, 2019. (AFP) Scamp has been a pet therapist for seven years, serving at the Sebastopol Senior Center and bringing his brand of ugly to help those in need. He also volunteers weekly to listen to first graders read stories, his bio says. But Scamp will have to put his philanthropy on hold as he ventures out to make his television debut on NBC's "Today" show Monday morning. In addition to bragging rights, Scamp has also won a trophy, and $1,500, which will be matched in a donation split between the Humane Society of Sonoma County, Angels Fund, and Compassion Without Borders. Two other dogs, Wild Thang and Tostito, came close to winning the coveted crown. A dog named Tostito, who has no teeth or lower jaw, is seen during the World's Ugliest Dog Competition in Petaluma, California on June 21, 2019. (AFP) Puka prepares to compete in the World's Ugliest Dog Contest at the Sonoma-Marin Fair in Petaluma, Calif., on Friday, June 21, 2019. (AP Photo/Noah Berger) Read more from Yahoo News UK: John Prescott in hospital after suffering stroke Woman bailed after trying to open plane door mid-air Firefighters smash window to rescue baby trapped in hot car Tostito was third runner up for World's Ugliest Dog. Wild Thang took second place in this year's competition. She is a three-year-old Pekingese from Los Angeles who suffers from distemper which impacts the movement of her jaw and tongue. Third place runner up Tostito is a rescue who had a rough start in life and as a result is missing his teeth and lower jaw. Watch the latest videos from Yahoo UK |
What Kind Of Shareholder Appears On The OneSpan Inc.'s (NASDAQ:OSPN) Shareholder Register?
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Every investor in OneSpan Inc. (NASDAQ:OSPN) should be aware of the most powerful shareholder groups. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.'
OneSpan is not a large company by global standards. It has a market capitalization of US$572m, which means it wouldn't have the attention of many institutional investors. In the chart below below, we can see that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about OSPN.
See our latest analysis for OneSpan
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
We can see that OneSpan does have institutional investors; and they hold 62% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of OneSpan, (below). Of course, keep in mind that there are other factors to consider, too.
Investors should note that institutions actually own more than half the company, so they can collectively wield significant power. Our data indicates that hedge funds own 5.2% of OneSpan. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. 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. 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.
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.
It seems insiders own a significant proportion of OneSpan Inc.. Insiders have a US$112m stake in this US$572m business. This may suggest that the founders still own a lot of shares. You canclick here to see if they have been buying or selling.
With a 13% ownership, the general public have some degree of sway over OSPN. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
It's always worth thinking about the different groups who own shares in a company. But to understand OneSpan better, we need to consider many other factors.
I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph.
If you would prefer 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. |
At US$4.89, Is It Time To Put Perceptron, Inc. (NASDAQ:PRCP) On Your Watch List?
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Perceptron, Inc. (NASDAQ:PRCP), which is in the electronic business, and is based in United States, saw a decent share price growth in the teens level on the NASDAQGM over the last few months. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s examine Perceptron’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Check out our latest analysis for Perceptron
According to my relative valuation model, the stock seems to be currently fairly priced. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Perceptron’s ratio of 21.78x is trading slightly above its industry peers’ ratio of 18.06x, which means if you buy Perceptron today, you’d be paying a relatively fair price for it. And if you believe that Perceptron 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 Perceptron’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. Though in the case of Perceptron, it is expected to deliver a negative earnings growth of -20%, 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?PRCP seems fairly priced right now, but given the uncertainty from negative returns in the future, this could be the right time to de-risk your portfolio. Is your current exposure to the stock beneficial for your total portfolio? And is the opportunity cost of holding a negative-outlook stock too high? Before you make a decision on PRCP, take a look at whether its fundamentals have changed.
Are you a potential investor?If you’ve been keeping an eye on PRCP for a while, now may not be the most optimal time to buy, given it is trading around its fair value. The stock appears to be trading at fair value, which means there’s less benefit from mispricing. Furthermore, the negative growth outlook increases the risk of holding the stock. However, there are also other important factors we haven’t considered today, which can help crystalize your views on PRCP should the price fluctuate below its true value.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Perceptron. You can find everything you need to know about Perceptron inthe latest infographic research report. If you are no longer interested in Perceptron, 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. |
Zcash executives fire back at Facebook’s attack on privacy
Privacy coin advocates are up in arms over Facebook’sLibra Coin.
Last week, Facebook’s blockchain leadDavid Marcusimplied that privacy-focused coins likeMoneroandZcashwere for criminals, and Libra—which he claimed provided its users with pseudonymity but otherwise complied with KYC and AML requirements—was not. “If you’re a criminal and you want to transact on a network, this is not going to be your network of choice because accounts are pseudonymous, not anonymous or shielded,” he said.
But key representatives of Zcash, the second largest privacy coin by market cap, said in interviews withDecryptthis weekend that Marcus is misleading—and Libra is little more than a way to hoodwink billions of people into believing their transactions would be private, when the social network would be quietly mining all that new data from its users.
“Facebook’s business model is fundamentally opposed to privacy,” says Josh Cincinnati, executive director of the Zcash Foundation. “[Facebook] being able to see the transaction graph more clearly definitely benefits their business as it stands today.”
Cincinnati added, “I think their entire model is predicated on it not being private.”
In aninterview withDecrypt, Marcus explained that many of the transactions on Libra will be made through custodial wallets, i.e. they will not be uploaded to the network’s ledger. However, for anyone making a direct transaction via other means, like directly sending Libra coin to someone else, that information would be uploaded and therefore available to anyone.
In contrast, privacy transactions on Zcash work by not revealing the transaction information to the blockchain. This means the addresses that the coins were sent to and from are hidden, along with the transaction amount. And this is where Marcus’s critique hones in: this system could, in theory, be used for illegitimate uses.
Jack Gavigan, head of product and regulatory affairs at Electric Coin Company—which also builds Zcash—argued that privacy coins are a technology that can be used for both good and bad. But that the societal benefits of having financial privacy outweigh the risks that some people will use the coin to commit crimes.
“There’s a growing recognition that privacy is desirable and important,” he said. “But there’s a balance to be struck between a panopticon model of surveillance in order to prevent terrorism versus a more proportionate set of measures that don’t involve wholesale breaches of individuals’ rights.”
In March, Facebookrebrandeditself a privacy-first business. But itsSwitzerland-based foundationand its announcement of a cryptocurrency that is anything but private, it’s clear not everyone at Menlo Park got the memo. |
3 Under-the-Radar but Amazing Dividend Stocks
Most investors could probably name one or two industries that are home to a dense collection of blue chip dividend stocks. For instance, shares of oil supermajors, tobacco producers, and electric utilities tend to pay market-beating dividends. But a high yield isn't necessarily the only thing that makes a great dividend stock.
It's important for big payouts to be accompanied by a strong business that can generate significant cash flow in good markets and bad. With that in mind, we asked three contributors at The Motley Fool for their best under-the-radar income stocks. Here's why they choseDuPont(NYSE: DD),Phillips 66 Partners(NYSE: PSXP), andMcCormick & Company(NYSE: MKC).
Image source: Getty Images.
Maxx Chatsko(DuPont):It's a little confusing, but the new DuPont is not the same company as the old DuPont. Despite flying under a familiar flag, the new business includes all of the specialty material science assets of both the old DuPont and the old Dow Chemical -- and nothing else. That said, it's expected to boast the highest operating margins among the three spinoffs from DowDuPont. It also sports a healthy annual dividend yield of 5.3%.
Income isn't the only thing that might draw in investors for a closer look. DuPont owns a collection of formidable brands including Tyvek (construction and packaging), the bio-based Sorona brand (high-performance fabrics), Kalrez (next-generation electronics including 5G hardware), and Vespel (aerospace). The latter two are expected to achieve a compound annual growth rate of 10% and 8%, respectively, through 2022. If the company can replicate its well-worn playbook for dominating markets with its materials science expertise, then shareholders should be treated pretty well.
That's hardly the only opportunity on the horizon. Materials from DuPont are commonly used in lightweight vehicles (read: replace heavier materials with lighter materials without sacrificing performance), which will become increasingly more important as electric vehicles capture market share. That's because battery-pack-slinging electric vehicles are traditionally heavier than their internal combustion counterparts. And being heavier isn't so great when customers are worried about the range of their new ride. Of course, the rise of electric vehicles will be great news for the business, which expects to generate $330 in revenue per electric vehicle, up from just $195 per vehicle running on liquid fuels.
While the dust is still settling from the spinoff, the financial flexibility of DuPont only figures to improve in the next several years. The business is still looking to divest certain assets and reduce capital expenditures, but it will repurchase $2 billion (or 4%) of outstanding shares and continue investing in core growth projects in the meantime. With approximately $22.6 billion in revenue and $6.4 billion in adjustedEBITDAgenerated in 2018, investors looking for a blue chip income stock shouldn't overlook thenewest materials science companyon the market.
Image source: Getty Images.
Matt DiLallo(Phillips 66 Partners):Most investors have probably heard about energy manufacturing and logistics giantPhillips 66, if for no other reason than it countsWarren Buffett among its investors. However, with all the attention on the parent, fewer investors are likely very familiar with itsmaster limited partnership(MLP) Phillips 66 Partners. That's a shame because the company has been an amazing dividend stock over the years. Overall, it has increased its distribution in all 22 quarters since its initial public offering in 2013. Those raises have helped boost Phillip 66 Partners' yield up to 6.8%.
The MLP backs that payout with solid financial metrics. The company generated enough cash during the recently completed first quarter to cover its distribution by a comfortable 1.3 times. Meanwhile, it ended the period with a leverage ratio of 2.8 times debt toEBITDA, which was well under the four times comfort level of most MLPs. That conservative financial profile gives Phillips 66 Partners the flexibility to continue investing in its expansion initiatives.
The company currently has several organic growth projects under construction, including a large-scale oil pipeline and an export terminal. As these projects enter service over the next 18 months, they'll supply the MLP with some incremental cash flow, some of which it will likely use to continue increasing its distribution to investors. That likelihood of continued income growth is why investors will want to get to know this amazing dividend stock.
Image source: Getty Images.
Demitri Kalogeropoulos(McCormick):Spices and flavorings might not make for the most exciting products, but their sales have generated fantastic long-term returns for McCormick's shareholders. The good news is that, after abrief stumblein early 2019, its market-thumping operating gains look set to continue through the new fiscal year.
McCormick is expecting to boost sales by between 3% and 5% this year, which is a bit below management's target of around 5% each year. Yet that growth would still produce market share gains, and it would make the spice giant one of the fastest-growing mature companies in the packaged foods space.
Income investors have two other reasons to like this stock today. First, McCormick'sprofitability is risingas its sales mix tilts further toward the new condiment brands it recently acquired. And second, its robust cash flow is allowing executives to quickly pay down the debt they took on to fund that huge purchase. Together, these trends should support rising dividend payments -- and higher stock repurchase spending -- over the next few years. That's good news for owners of this company, which has paid a dividend for 93 consecutive years while raising that payout in each of the past 33 years.
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Demitrios Kalogeropouloshas no position in any of the stocks mentioned.Matthew DiLalloowns shares of McCormick and Phillips 66.Maxx Chatskohas no position in any of the stocks mentioned. The Motley Fool recommends McCormick. The Motley Fool has adisclosure policy. |
What Does ORBCOMM Inc.'s (NASDAQ:ORBC) Balance Sheet Tell Us About It?
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ORBCOMM Inc. (NASDAQ:ORBC) is a small-cap stock with a market capitalization of US$574m. 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? Given that ORBC is not presently profitable, it’s essential to evaluate the current state of its operations and pathway to profitability. The following basic checks can help you get a picture of the company's balance sheet strength. Nevertheless, this is not a comprehensive overview, so I recommend youdig deeper yourself into ORBC here.
ORBC's debt levels surged from US$247m to US$260m over the last 12 months , which includes long-term debt. With this rise in debt, ORBC currently has US$58m remaining in cash and short-term investments , ready to be used for running the business. On top of this, ORBC has generated US$22m in operating cash flow over the same time period, leading to an operating cash to total debt ratio of 8.3%, signalling that ORBC’s debt is not covered by operating cash.
At the current liabilities level of US$65m, the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.64x. The current ratio is calculated by dividing current assets by current liabilities. Generally, for Telecom 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 97%, ORBC can be considered as an above-average leveraged company. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. But since ORBC is presently unprofitable, sustainability of its current state of operations becomes a concern. Running high debt, while not yet making money, can be risky in unexpected downturns as liquidity may dry up, making it hard to operate.
Although ORBC’s debt level is towards the higher end of the spectrum, its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. I admit this is a fairly basic analysis for ORBC's financial health. Other important fundamentals need to be considered alongside. I recommend you continue to research ORBCOMM to get a better picture of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for ORBC’s future growth? Take a look at ourfree research report of analyst consensusfor ORBC’s outlook.
2. Valuation: What is ORBC 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 ORBC 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. |
Canopy Growth's Q4 Earnings Report: All the Key Metrics Investors Should Know
Canopy Growth(NYSE: CGC), a leading Canadian cannabis grower, reported fourth-quarter and full-year results for fiscal 2019 after the market closed on Thursday.
Shares of the largest cannabis stock by market cap dropped 8.1% on Friday. We can attribute the market's reaction to a net loss that widened more than Wall Street was expecting.
Here's how the quarter worked out for Canopy and its investors.
All monetary figures are in Canadian dollars.
Metric
Fiscal Q4 2019
Fiscal Q4 2018
Year-Over-Year Change
Net revenue
CA$94.1 million
CA$22.8 million
313%
Operating income
(CA$174.5 million)*
(CA$51.0 million)
Loss widened by 242%
Net income
(CA$323.4 million)
(CA$54.4 million)
Loss widened by 494%
Earnings per share (EPS)
(CA$0.98)
(CA$0.31)
Loss widened by 216%
Data source: Canopy Growth. Results based on International Financial Reporting Standards (IFRS). *Operating loss would have been even greater if fair value changes of biological assets and unrealized losses/gains on these assets were excluded, as they would be if Canopy were a U.S. company and using generally accepted accounting principles (GAAP).
On a sequential basis, Q4 revenue increased 13%, with Canopy attributing this growth from Q3 to "additional revenue being generated through value-added products, extraction services, and clinic partners."
Wall Street was modeling for a quarterly loss of CA$0.22, so Canopy fell far short of this projection. Revenue came in on target.
In Q4, gross margin before the IFRS fair value impacts was 16% of net revenue, down from 34% of net revenue in the year-ago period. This decline was primarily due to "operating expenses for facilities not yet cultivating or facilities that had underutilized capacity," CFO Mike Lee said on the earnings call.
For full-year fiscal 2019, net revenue soared 191% year over year to CA$226.3 million, operating loss expanded 601% to CA$577 million, and the net loss widened by more than 12 times to CA$670.1 million. On a per-share basis, the company lost CA$2.57, compared with a net loss of CA$0.40 last fiscal year.
At the end of the period, Canopy had CA$4.5 billion in cash and cash equivalents. The company has the biggest cash pile by far among its peers, thanks to its partnership with Corona and Modelo beer makerConstellation Brands(NYSE: STZ). Canopyreceived $4 billion(in U.S. dollars) last fall, when the alcoholic-beverage giant raised its stake in it to 38%.
Product
Gross Revenue Fiscal Q4 2019
Gross Revenue Fiscal Q4 2018
Year-Over-Year Change
Canadian recreational cannabis-business to business
CA$57.2 million
--
100%
Canadian recreational cannabis-business to consumer
CA$11.7 million
--
100% Canadian medical cannabis
CA$11.6 million
CA$19.5 million
(41%) International medical cannabis
CA$1.8 million
CA$2.4 million
(25%) Other revenue
CA$24.2 million
CA$0.9 million
2589% Total gross revenue CA$106.5 million CA$22.8 million 367% (Less excise tax) (CA$12.4 million) -- -- Net revenue CA$94.1 million CA$22.8 million 313%
Data source: Canopy Growth.
Slicing and dicing revenue a few other ways:
• Total gross marijuana revenue was 84% from recreational sales and 16% from medical sales.
• International marijuana sales comprised just 2.2% of total gross marijuana revenue.
• Total gross marijuana sales accounted for about 77% of the company's total revenue, while "other revenue" contributed the remaining 23%.
in Q4, recreational marijuana sales increased 100% over the year-ago quarter because adult-use cannabis has only been legal in Canada since October. Sales edged down 3.8% from Q3, which investors shouldn't be concerned about as the Canadian distribution system is a work-in-progress, as are the supply chains of Canopy and its peers. The slight sequential decline isn't due to a demand issue.
In both the fourth quarter and full year, Canadian medical marijuana sales declined year over year, but that wasn't unexpected. Here's Canopy's explanation:
The Company's Canadian online medical store saw a period of major transformation during the fiscal year, with established brands ... transitioning to the recreational channel. This product transition, along with product supply challenges, which have since been remedied, led to a decline in the medical channel in the second half of fiscal 2019. ... Following the rebrand of Spectrum Cannabis, Canopy Health Innovations and C3 into a singular medically focused division Spectrum Therapeutics ... the Company believes that Canadian medical sales ... will be able to return to previous levels.
In Q4, international medical marijuana sales declined 25% year over year to CA$1.8 million. The decline was primarily due to supply constraints, CFO Lee said on the earnings call. This issue should soon be behind the company, given its Canadian medical channel is fully supplied and its Danish production capacity is due to come online this calendar year.
For the full fiscal year, international medical cannabis revenue jumped 173% to CA$10.1 million, driven by growth in Germany and the company's launch in the Polish and Czech markets.
The "other revenue" category primary includes sales of vaporizers made by Storz & Bickel, which Canopy acquired in Q3, along with revenue from extraction services, clinic partners, and merchandise.
Metric
Fiscal Q4 2019
Fiscal Q4 2018
Year-Over-Year Change
Kilograms and kilogram equivalents sold 9,326 2,528 269% Average selling price per gram-recreational CA$7.28 -- -- Average selling price per gram-Canadian medical CA$8.17 CA$8.00 2% Average selling price per gram-international medical
CA$13.9
CA$13.4 4% Average selling price per gram-overall CA$7.49 CA$8.43 (11%) Quantity harvested 14,469 kilograms* 4,811 Kilograms 201%
Data source: Canopy Growth. *1 kilogram = about 2.2 pounds.
The 11% year-over-year decrease in overall average selling price per gram of marijuana was due to the opening of the Canadian recreational market in October and the company's shift toward more business to business sales.
In the quarter, sales of oil and soft gel capsules accounted for 40% of total gross marijuana revenue, up considerably from 21% in the year-ago period, while dried flower comprised the remainder. This boosted average selling prices, as these are value-added products.
Soon after the fiscal year ended, Canopy acquired Germany-based C3 Cannabinoid Compound Company, Europe's largest cannabinoid-based pharmaceutical company, and This Works Products, a UK-based beauty and wellness brand. These acquisitions reflect the company's aim to expand globally.
In mid-April, Canopy announced that it was buying the rights to acquireAcreage Holdings(NASDAQOTH: ACRGF), a U.S.-based cannabis producer. Thedealhas Canopy paying $300 million up front for the right to acquire Acreage for $3.4 billion if the U.S. federal government legalizes marijuana. Last week, shareholders of Canopy and Acreage approved the transaction.
Here's what founder and Co-CEO Bruce Linton had to say in the earnings release:
The fourth quarter wraps up a historic year with major steps taken in Canada to build out our national platform while scaling all of our processes to bring cannabis to market. The third quarter of the year benefited from months of advanced production while the fourth quarter relied more on efficient throughput and a more automated platform. With more product formats coming to the Canadian market later in the year, we are working hard to ensure that we are ready to hit the ground running with products, formats and brands that Canadians trust.
Canopy is investing heavily for growth, so investors shouldn't be concerned at this point with its widening net loss.
The company has countless catalysts for growth on the horizon. In Q1 of fiscal 2020, it expects its Canadian cannabis harvest to increase to about 34,000 kilograms. That represents a 135% jump from the just-reported quarter. The ramped-up capacity is expected to increase finished inventory available for sale beginning in Q2.
Moreover, fiscal 2020 should get a boost from two new revenue sources that Canopy expects to come online later in the fiscal year:
1. Edibles, vapes, and cannabis-infused beverages are expected to get the green light in Canada later this calendar year. The company currently anticipates that it will be able to start selling these products in mid-December. The beverages are being developed with partner Constellation Brands.
2. Hemp-derived cannabidiol (CBD) products are anticipated to be brought to market in the United States by the end of fiscal 2020. (CBD is a nonpsychoactive chemical that's been linked to various medicinal benefits.) This market opened up because of the enactment of the U.S. Farm Bill on Jan. 1.
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Beth McKennaowns shares of Canopy Growth. The Motley Fool recommends Constellation Brands. The Motley Fool has adisclosure policy. |
Iranians say their 'bones breaking' under US sanctions
TEHRAN, Iran (AP) — As the U.S. piles sanction after sanction on Iran, it's the average person who feels it the most. From a subway performer's battered leather hat devoid of tips, to a bride-to-be's empty purse, the lack of cash from the economic pressure facing Iran's 80 million people can be seen everywhere. Many blame President Donald Trump and his maximalist policy on Iran, which has seen him pull out of Tehran's 2015 nuclear deal with world powers and levy punishing U.S. sanctions on the country. In recent weeks, Iran has threatened to break out of the deal unless European powers mitigate what it calls Trump's "economic warfare." Iran also appeared ready to push back against the buildup of U.S. forces in the region, after shooting down an American drone it says violated its airspace last week. In response, U.S. officials have announced yet more stringent sanctions. But alongside Trump, many Iranians blame their own government, which has careened from one economic disaster to another since its Islamic Revolution 40 years ago. "The economic war is a reality and people are under extreme pressure," said Shiva Keshavarz, a 22-year-old accountant soon to be married. She said government leaders "keep telling us to be strong and endure the pressures, but we can already hear the sound of our bones breaking." Walking by any money exchange shop is a dramatic reminder of the hardships most people are facing. At the time of the nuclear deal, Iran's currency traded at 32,000 rials to $1. Today, the numbers listed in exchange shop windows have skyrocketed — it costs over 130,000 rials for one U.S. dollar. Inflation is over 37%, according to government statistics. More than 3 million people, or 12% of working-age citizens, are unemployed. That rate doubles for educated youth. Depreciation and inflation make everything more expensive — from fruits and vegetables to tires and oil, all the way to the big-ticket items, like mobile phones. A simple cell phone is about two months' salary for the average government worker, while a single iPhone costs a 10 months' salary. Story continues "When importing mobile phones into the country is blocked, dealers have to smuggle them in with black market dollar rates and sell them for expensive prices," said Pouria Hassani, a mobile phone salesman in Tehran. "You can't expect us to buy expensive and sell cheap to customers. We don't want to make a loss either." Hossein Rostami, a 33-year-old motorbike taxi driver and deliveryman, said the price of brake pads alone had jumped fivefold. "The cause of our problems is the officials' incompetence," he told The Associated Press as fellow motorbike drivers called out for passengers in Tehran. "Our country is full of wealth and riches." The riches part is true — Iran is home to the world's fourth-largest proven reserve of crude oil and holds the world's second-largest proven reserve of natural gas, after Russia. But under Trump's maximum-pressure campaign, the U.S. has cut off Iran's ability to sell crude on the global market, and threatened to sanction any nation that purchases it. Oil covers a third of the $80 billion a year the government spends in Iran, meaning that a fall in oil revenues cuts into its social welfare programs, as well as its military expenditures. The rest of the country's budget comes from taxes and non-oil exports, among them oil-based petrochemical products that provide up to 50% of Iran's $45 billion in non-oil export. In Tehran's Laleh park, retired school teacher Zahra Ghasemi criticized the government for blaming "every problem" on U.S. sanctions. She says she has trouble paying for her basic livelihood. The price of a bottle of milk has doubled, along with that of vegetables and fruit. "We are dying under these pressures and a lack of solutions from officials," Ghasemi said. Years of popular frustration with failed economic policies triggered protests in late 2017, which early the following year spiraled into anti-government demonstrations across dozens of cities and towns. The current problems take root in Iran's faltering efforts to privatize its state-planned economy after the devastating war with Iraq in the 1980s, which saw 1 million people killed. But Oil Minister Bijan Zanganeh said earlier this month that the crunch on oil exports is hitting harder today than during the 1980s war, when Saddam Hussein's forces targeted Iran's oil trade. "Our situation is worse than during the war," Zanganeh said. "We did not have such an export problem when Saddam was targeting our industrial units. Now, we cannot export oil labeled Iran." Still, many Iranians pin the economic crisis on corruption as much as anything else. "Our problem is the embezzlers and thieves in the government," said Nasrollah Pazouki, who has sold clothes in Tehran's Grand Bazaar since before the 1979 Islamic Revolution. "When people come to power, instead of working sincerely and seriously for the people, we hear and read after a few months in newspapers that they have stolen billions and fled." He added: "Whose money is that? It's the people's money." Sanctions do cause some of the problems, said Jafar Mousavi, who runs a dry-goods store in Tehran. But many of the woes are self-inflicted from rampant graft, he said. "The economic war is not from outside of our borders but within the country," Mousavi said. "If there was integrity among our government, producers and people, we could have overcome the pressures." Yet people come and go each day to work on Tehran's crowded metro, seemingly earning less each day for the same work. In one train car, Abbas Feayouji and his son Rahmat play mournful-sounding traditional love songs known as "Sultan-e Ghalbha," or "King of Hearts" in Farsi. "People pay less than before," said the elder Feayouji, a 47-year-old father of three, as he took a short break to speak to the AP. "I don't know why they do, but it shows people have less money than before." |
Should You Like ON Semiconductor Corporation’s (NASDAQ:ON) High Return On Capital Employed?
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Today we are going to look at ON Semiconductor Corporation (NASDAQ:ON) to see whether it might be an attractive investment prospect. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.
First up, we'll look at what ROCE is and how we calculate it. Second, we'll look at its ROCE compared to similar companies. Finally, we'll look at how its current liabilities affect its ROCE.
ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. In general, businesses with a higher ROCE are usually better quality. Overall, it is a valuable metric that has its flaws. Author Edwin Whitingsaysto be careful when comparing the ROCE of different businesses, since 'No two businesses are exactly alike.'
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for ON Semiconductor:
0.14 = US$855m ÷ (US$7.6b - US$1.3b) (Based on the trailing twelve months to March 2019.)
So,ON Semiconductor has an ROCE of 14%.
See our latest analysis for ON Semiconductor
When making comparisons between similar businesses, investors may find ROCE useful. ON Semiconductor's ROCE appears to be substantially greater than the 11% average in the Semiconductor industry. I think that's good to see, since it implies the company is better than other companies at making the most of its capital. Regardless of where ON Semiconductor sits next to its industry, its ROCE in absolute terms appears satisfactory, and this company could be worth a closer look.
As we can see, ON Semiconductor currently has an ROCE of 14% compared to its ROCE 3 years ago, which was 10%. This makes us think the business might be improving.
When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. Companies in cyclical industries can be difficult to understand using ROCE, as returns typically look high during boom times, and low during busts. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company.
Liabilities, such as supplier bills and bank overdrafts, are referred to as current liabilities if they need to be paid within 12 months. Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual. To counter this, investors can check if a company has high current liabilities relative to total assets.
ON Semiconductor has total assets of US$7.6b and current liabilities of US$1.3b. Therefore its current liabilities are equivalent to approximately 17% of its total assets. Current liabilities are minimal, limiting the impact on ROCE.
This is good to see, and with a sound ROCE, ON Semiconductor could be worth a closer look. ON Semiconductor shapes up well under this analysis,but it is far from the only business delivering excellent numbers. You might also want to check thisfreecollection of companies delivering excellent earnings growth.
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
No, its not just you: Half of the internet is down, including Google, Amazon, and Reddit
What better way to start off the week than by not being able to use virtually any online service or access half of the internets most popular sites? That seems to be the case, as DownDetector (and many tweets) suggest that Google, Amazon, Reddit, and Spectrum just to name a few are experiencing issues this morning. Those issues appear to have begun around 6 or 7 AM ET, just as the East Coast was starting its day. Although some of these connection problems appear to be clearing up as of 8:40 AM (for example, Feedly is finally loading for me after being inaccessible since before 8:00 AM), its likely going to take some time before everything is running smoothly again. Reports are still going up on DownDetector as of writing. Related Stories: One of the Pixel 4's best new camera features came to the iPhone three years ago Prime Day 2019 starts on July 15th and lasts for 48 hours Fresh Pixel 4 leak gives us another look at Google's unreleased flagship Its unclear what is causing half of the internet to go down, but an ominous message from Discord refers to the issue as a general internet outage, which doesnt sound like something that should be possible: About an hour ago, internet service company Cloudflare says that it identified a possible route leak impacting some Cloudflare IP ranges. [ UPDATE: To be clear, Verizon was responsible for the outage, and Cloudflare was just keeping its customers informed during the recovery process. ] Cloudflare followed up with another update about an hour later explaining that the leak is impacting many internet services including Cloudflare, and moments later, announced that the network responsible for the leak had fixed the issues as of 8:42 AM ET. In theory, the worst of the outage is over. Well be keeping an eye out for any residual issues that pop up in the hours to come, but we also hope to get a more detailed explanation for why this happened from the network responsible in the near future. UPDATE | 3:30 PM : After service was restored, Cloudflare issued the following statement (via TechCrunch ): Earlier today, a widespread BGP routing leak affected a number of Internet services and a portion of traffic to Cloudflare. All of Cloudflares systems continued to run normally, but traffic wasnt getting to us for a portion of our domains. At this point, the network outage has been fixed and traffic levels are returning to normal. BGP acts as the backbone of the Internet, routing traffic through Internet transit providers and then to services like Cloudflare. There are more than 700k routes across the Internet. By nature, route leaks are localized and can be caused by error or through malicious intent. Weve written extensively about BGP and how weve adopted RPKI to help further secure it. Story continues Cloudflare CEO Matthew Prince also offered a biting take of his own on Twitter: BGR Top Deals: 10 deals you dont want to miss on Sunday: $8 wireless charger, $79 soundbar, AirPods 2 and iPad deals, more Dashs awesome compact air fryer is back down to $39.99 today Trending Right Now: Everything new coming to Netflix this week, and everything leaving (week of June 23) New trailers you need to watch from this week: Spider-Man, Point Blank, and more Samsungs deepfake technology is getting scary See the original version of this article on BGR.com View comments |
Herbalife (HLF) Jumps: Stock Rises 5.7%
Herbalife Nutrition Ltd.HLF was a big mover last session, as the company saw its shares rise nearly 6% on the day. The move came on solid volume too with far more shares changing hands than in a normal session. This stock, which remained volatile and traded within the range of $41.25–$44.13 in the past one-month time frame, witnessed a sharp increase on Friday.The company has seen one negative estimate revision in the past few months, while its Zacks Consensus Estimate for the current quarter has also moved lower over the past few months, suggesting there may be trouble down the road. So make sure to keep an eye on this stock going forward, to see if this recent move higher can last.Herbalife currently has a Zacks Rank #4 (Hold) while its Earnings ESP is 0.00%.
Herbalife LTD. Price
Herbalife LTD. price | Herbalife LTD. Quote
Investors interested in the Retail - Pharmacies and Drug Stores industry may consider Rite Aid Corporation RAD, which has a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Is HLF going up? Or down? Predict to see what others think: Up or DownMore Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportHerbalife LTD. (HLF) : Free Stock Analysis ReportRite Aid Corporation (RAD) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Lamb Weston Plans Capacity Expansion, Set to Buy Ready Meals
Lamb Weston Holdings, Inc.LW has inked a deal to acquire one of Australia’s renowned frozen potato processing company — Ready Meals Pty Ltd. The move is in sync with the company’s efforts to expand production capabilities and meet the rising demand for potato snacks. Let’s take a closer look.Efforts to Boost Production CapacityThe Ready Meals buyout is expected to augment Lamb Weston’s global manufacturing network production capabilities by nearly 70 million pounds. Ready Meals, which sells products under the Harvest Choice brand, has its facility located in Hallam, Victoria. The acquisition is likely to to strengthen Lamb Weston’s presence in Australia.Post completion of the deal, Lamb Weston will account for 18 processing facilities globally apart from ownership in 8 facilities through joint-venture initiatives. Although the terms of the deal have not been disclosed, it is subject to certain closing conditions.Markedly, Lamb Weston is undertaking efforts to bolster production capabilities, as demand for snacks and fries are rising worldwide. Earlier, the company completed the expansion of a facility located at Hermiston, OR. The expansion has facilitated the addition of a new processing line for increasing the production of frozen french fries.Apart from capacity expansion, the company is striving to strengthen commercial networks and bolster portfolio through innovations. It also resorts to limited time offers (LTO) innovations to expand revenue prospects. Further, Lamb Weston is gaining from robust price/mix across most segments.
Rising Costs and Challenges in Europe are WorriesDespite the above-mentioned efforts to strengthen business, there are significant hurdles in Lamb Weston’s path that cannot be ignored. Notably, the company’s SG&A expenses have been rising for a while. For fiscal 2019, management expects SG&A costs to increase due to planned investments to support the upgrade of information systems and enterprise resource planning infrastructure. Additionally, the company expects transportation, input and manufacturing costs to increase in fiscal 2019.This Zacks Rank #4 (Sell) company is also experiencing uncertainties in Europe. In fact, operations in the region are expected to remain dismal during fiscal 2019 and in the first half of fiscal 2020, thanks to poor potato harvest.Such downturns have caused the company’s shares to decline around 16% in the past three months compared with the industry’s decline of 2.8%. Nevertheless, we expect the company’s expansion plans to cushion the headwinds and revive the stock in the forthcoming periods.Looking for Consumer Staples Stocks? Check TheseGeneral Mills GIS, with long-term earnings per share growth rate of 7%, carries a Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.Campbell Soup Company CPB, with long-term earnings growth rate of 5%, carries a Zacks Rank #2.The Chefs' Warehouse CHEF, also with a Zacks Rank #2, has long-term earnings growth rate of 15%.More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportGeneral Mills, Inc. (GIS) : Free Stock Analysis ReportThe Chefs' Warehouse, Inc. (CHEF) : Free Stock Analysis ReportLamb Weston Holdings Inc. (LW) : Free Stock Analysis ReportCampbell Soup Company (CPB) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Is Orthofix Medical Inc. (NASDAQ:OFIX) Trading At A 26% Discount?
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In this article we are going to estimate the intrinsic value of Orthofix Medical Inc. (NASDAQ:OFIX) by projecting its future cash flows and then discounting them to today's value. This is done using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
We generally believe that a company's value is the present value of all of the cash it will generate in the future. However, a DCF is just one valuation metric among many, and it is not without flaws. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model.
Check out our latest analysis for Orthofix Medical
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we discount the value of these future cash flows to their estimated value in today's dollars:
[{"": "Levered FCF ($, Millions)", "2019": "$24.72", "2020": "$50.13", "2021": "$60.66", "2022": "$69.24", "2023": "$76.65", "2024": "$83.03", "2025": "$88.55", "2026": "$93.39", "2027": "$97.73", "2028": "$101.71"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x2", "2020": "Analyst x2", "2021": "Analyst x1", "2022": "Est @ 14.14%", "2023": "Est @ 10.72%", "2024": "Est @ 8.32%", "2025": "Est @ 6.64%", "2026": "Est @ 5.47%", "2027": "Est @ 4.65%", "2028": "Est @ 4.07%"}, {"": "Present Value ($, Millions) Discounted @ 8.17%", "2019": "$22.85", "2020": "$42.84", "2021": "$47.92", "2022": "$50.56", "2023": "$51.75", "2024": "$51.82", "2025": "$51.08", "2026": "$49.81", "2027": "$48.18", "2028": "$46.36"}]
Present Value of 10-year Cash Flow (PVCF)= $463.17m
"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 (2.7%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 8.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$102m × (1 + 2.7%) ÷ (8.2% – 2.7%) = US$1.9b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$1.9b ÷ ( 1 + 8.2%)10= $874.59m
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $1.34b. 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 $70.16. Compared to the current share price of $52.27, the company appears a touch undervalued at a 26% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent.
Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Orthofix Medical 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 8.2%, which is based on a levered beta of 0.914. 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.
Valuation is only one side of the coin in terms of building your investment thesis, and 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. What is the reason for the share price to differ from the intrinsic value? For Orthofix Medical, There are three additional aspects you should further examine:
1. Financial Health: Does OFIX 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 OFIX'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 OFIX? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NASDAQ every day. If you want to find the calculation for other stocks justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Crocs (CROX) Looks Good: Stock Adds 8.3% in Session
Crocs, Inc.CROX was a big mover last session, as the company saw its shares rise more than 8% on the day. The move came on solid volume too with far more shares changing hands than in a normal session. This reverses the recent trend for the company—as the stock is now down 11.3% in the past one-month time frame.The company has seen no changes when it comes to estimate revision over the past few weeks, while the Zacks Consensus Estimate for the current quarter has also remained unchanged. The recent price action is encouraging though, so make sure to keep a close watch on this firm in the near future.Crocs currently has a Zacks Rank #1 (Strong Buy) while its Earnings ESP is 0.00%.
Crocs, Inc. Price
Crocs, Inc. price | Crocs, Inc. Quote
Investors interested in the Textile - Apparel industry may consider Columbia Sportswear Company COLM, which has a Zacks Rank #1. You can seethe complete list of today’s Zacks #1 Rank stocks here.Is CROX going up? Or down? Predict to see what others think:Up or Down
More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportColumbia Sportswear Company (COLM) : Free Stock Analysis ReportCrocs, Inc. (CROX) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
5 House Flipping Mistakes to Avoid
These days, house flipping is a popular concept. There are entire TV shows devoted to it. It may even be something you've thought about doing yourself. The premise is simple: You buy a home that might not be in the best condition. Because of its state of disrepair, you get it for a good deal. You spend a few weeks fixing the place up, slapping on a new coat of paint -- literally or figuratively -- then quickly list and get the place sold. You should walk away with a tidy little profit. [ Read: You Bought a Fixer-Upper. Now What? ] Yes, on paper, it's pretty simple. But in practice, there are a number of reasons why your house flip can go wrong. Here are five house flipping mistakes to avoid that could derail your investment: -- Not having enough money. -- Not having a business plan. -- Not having property insurance. -- Not understanding the market. -- Overpricing your listing. Not Having Enough Money You've probably heard the old expression about how you need to spend money to make money. Well, that's certainly true in house flipping. Before you can realize a profit, you've got to sink a little money into fixing the place up -- making repairs, adding new fixtures, replacing appliances and more. How much exactly all of this could cost depends on the upgrades you are willing to make and the materials you want to use. For example, if you want to replace the countertops in the kitchen , the difference between choosing marble or granite can make a big difference. But what happens if you buy a house that's in disrepair, and then realize you don't have the resources you need to fix it up? That can wreck all your plans for a successful house flip. Always make sure you've got some cash on hand before you invest in a house flip property. Not Having a Business Plan House flipping isn't just about getting the place sold. It's about getting the margins right. It requires you to not overpay on the front end; to stay on time and on budget as you make repairs; to list and sell expediently; and to get a certain sale price . Story continues If any of those components are out of place, you may end up losing money on your house flip. That's what makes it so necessary to have a business plan where you lay everything out in advance -- and maybe leave yourself a little room for error. A business plan could include: 1. A list of all the repairs you want to make. 2. A list of prices for everything you want to replace so you can stay on budget. 3. A schedule to make sure you are spending the right amount of time on certain projects. [ Read: The Guide to Selling Your Home ] Not Having Property Insurance One of the top house selling tips for flippers: Get insured. Yes, really. Property insurance isn't just for your residential property. It can also help you protect your house flip against fire, flood or items and materials lost to theft. Yes, it's going to eat into your margins just a little. But imagine the alternative -- buying an investment property and losing everything in some kind of natural disaster. Insurance can make that a non-issue. Not Understanding the Market A successful house flip isn't just about the property; it's about the market itself. Simply put, you can get a great deal on your initial investment, you can spruce the place up and you can list it for a competitive price. But if the market's bad, you may still have a hard time selling . Intimate knowledge of your local real estate market is essential to any successful flip. Look at the comparable home sales in the neighborhood. How much are houses with similar floor plans and square footage listing for? How are neighboring houses that have been listed doing? Have they gotten any offers or has the home selling process been really slow? Have those offers been below asking price, and by how much? How long have neighboring houses been on the market? These are all helpful questions to ask yourself before purchasing a home you have the intention of flipping. [ Read: How Many Homes Does It Take for First-Time Buyers to Find the One? ] Overpricing Your Listing When it comes to how to sell a house, pricing is always key. And that's very much the case when you're flipping. If you undervalue it, you're leaving money on the table. And if you overprice it, you won't get any takers -- and the property may just languish on the market. Either way, your investment is in trouble. Make sure you do your due diligence , checking comps and surveying the market, before you price your home. And by the way, you'll want to start thinking about pricing before you invest, ensuring it's actually going to be worth your time. House flipping can be exciting -- and profitable. But that's only possible when you take care to do it right , avoiding these common errors. More From US News & World Report 7 Bathroom Remodel Ideas on a Budget 5 Must-Ask Questions About Housing Code Violations How to Finish a Basement |
Should You Be Impressed By Pharmagest Interactive SA's (EPA:PHA) 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 Pharmagest Interactive SA (EPA:PHA), by way of a worked example.
Our data showsPharmagest Interactive has a return on equity of 23%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 €0.23.
Check out our latest analysis for Pharmagest Interactive
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Pharmagest Interactive:
23% = €25m ÷ €117m (Based on the trailing twelve months to December 2018.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all 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 looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. The higher the ROE, the more profit the company is making. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, Pharmagest Interactive has a higher ROE than the average (8.2%) in the Healthcare Services industry.
That's clearly a positive. I usually take a closer look when a company has a better ROE than industry peers. For exampleyou might checkif insiders are buying shares.
Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
Pharmagest Interactive has a debt to equity ratio of 0.37, which is far from excessive. The combination of modest debt and a very impressive ROE does suggest that the business is high quality. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is one way we can compare the business quality of different companies. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Elon Musk mixes up the moon and Mars in tweet
Elon Muskmade an out of this world mistake on Sunday.
TheTeslaCEO was mocked on Twitter after he tweeted a graphic with the words “Occupy Mars,” but included a picture of the moon rather than the red planet. The image was from the July 2018 lunar eclipse that was known as the blood moon because of the red hue.
A follower quickly pointed out the mistake and replied to Musk’s tweet saying, “That’s the moon” with a screenshot of a Google search to prove her point. The billionaire acknowledged his mistake with the laughing emoji.
“Moon too,” Musk said in a follow-up tweet. He responded to another user, "Moon 1st, as it's only 3 days away & u don't need interplanetary orbital synchronization."
Musk had tweeted the image after saying earlier Sunday that he was “accelerating Starship development to build the Martian Technocracy.” Starship refers to the 180-foot-tall SpaceX rocket that, along with launching satellites into orbit, could one day carry people to the moon and Mars. The rocket is being tested in Texas for takeoffs and landings.
When asked by a Twitter user Sunday if people could start reserving seats for a trip to Mars, Musk responded “after Starship returns from orbit” around Earth.
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Musk was back on Twitter a week after claiming he was deleting his account and changing his name to "Daddy DotCom." He deleted the tweet on Tuesday and reverted his handle name back.
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Interested In Pharmagest Interactive SA (EPA:PHA)? Here's What Its Recent Performance Looks Like
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After looking at Pharmagest Interactive SA's (EPA:PHA) latest earnings announcement (31 December 2018), I found it useful to revisit the company's performance in the past couple of years and assess this against the most recent figures. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is a crucial aspect. Below is a brief commentary on my key takeaways.
View our latest analysis for Pharmagest Interactive
PHA's trailing twelve-month earnings (from 31 December 2018) of €25m has increased by 9.6% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 9.7%, indicating the rate at which PHA is growing has slowed down. To understand what's happening, let's examine what's occurring with margins and whether the rest of the industry is experiencing the hit as well.
In terms of returns from investment, Pharmagest Interactive has invested its equity funds well leading to a 23% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 11% exceeds the FR Healthcare Services industry of 4.3%, indicating Pharmagest Interactive has used its assets more efficiently. However, its return on capital (ROC), which also accounts for Pharmagest Interactive’s debt level, has declined over the past 3 years from 29% to 24%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 3.2% to 37% over the past 5 years.
Pharmagest Interactive'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 Pharmagest Interactive gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. I suggest you continue to research Pharmagest Interactive to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for PHA’s future growth? Take a look at ourfree research report of analyst consensusfor PHA’s outlook.
2. Financial Health: Are PHA’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 2018. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
'Matilda' star Mara Wilson defends getting political
As the Roald Dahl heroine Matilda in the 1996 film of the same name, child star Mara Wilson faced off against her boorish parents and the evil Miss Trunchbull. As an adult who has gone on to become a writer, the 31-year-old Wilson uses her Twitter to take on ICE, President Trump and anti-abortion-rights activists — much, apparently, to the consternation of some of her more conservative followers. Wilson, who also starred in Mrs. Doubtfire and Miracle on 34th Street as a child, went online on Sunday to call out critics who mock her for “being too opinionated or political” by calling her “Matilda.” Mara Wilson (pictured with her little sister) at the premiere of Matilda . (Photo: SGranitz/WireImage) While it’s intended as an insult to discredit Wilson as an out-of-her-depth Hollywood star, Wilson tweeted that her most famous character was something of an activist herself, defeating the “abusive tyrant” Miss Trunchbull. I love when people call me Matilda when they think I’m being too opinionated or political Because Matilda, who incited a riot at her school and got rid of an abusive tyrant at age six, wouldn’t be political at all — Mara “Get Rid of the Nazis” Wilson (@MaraWilson) June 24, 2019 Her fans agree. This should be the sequel — erika🍒 (@_erikaswords) June 24, 2019 Matilda has a brain and fought for the underdogs and good authority figures against the overly-powerful idiots. And she had excellent taste in literature. How in the world is that an insult???? — JKChicago (@JKChicago79) June 24, 2019 Reading it to my 4-year-old now, so that she knows she is powerful too. — Susan Andrus (@susanandrus) June 24, 2019 Keep on giving it to the Trunchbulls of the world. — Andrew (@AndrewSnarks) June 24, 2019 The guiding morality of Matilda was "When a person is bad, that person gets punished." And the lead villain of Matilda literally locked children in a cage to punish them. You do the math on what stances Matilda would take — 💖💛💙Adira💖💛💙 (@AdiraStopsBrian) June 24, 2019 and didn't she use, like uh her brain to do the thing you have just described — Charlotte A. Cavatica (@cavaticat) June 24, 2019 Wilson isn’t letting Matilda take all the credit, however. Story continues I don’t think she would want to take away from who actually did it, though — Mara “Get Rid of the Nazis” Wilson (@MaraWilson) June 24, 2019 Read more from Yahoo Lifestyle: Dax Shephard, Kristen Bell speak out against anti-vaxx movement Khloe Kardashian looks flawless at Mohegan Sun casino before an explosive episode of 'KUWTK' Bella Thorne says she taught herself to read and count Follow us on Instagram , Facebook and Twitter for nonstop inspiration delivered fresh to your feed, every day. |
Do Directors Own Premier Gold Mines Limited (TSE:PG) Shares?
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A look at the shareholders of Premier Gold Mines Limited (TSE:PG) can tell us which group is most powerful. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. Companies that used to be publicly owned tend to have lower insider ownership.
With a market capitalization of CA$417m, Premier Gold Mines is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let's delve deeper into each type of owner, to discover more about PG.
Check out our latest analysis for Premier Gold Mines
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
We can see that Premier Gold Mines does have institutional investors; and they hold 34% of the stock. 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 Premier Gold Mines, (below). Of course, keep in mind that there are other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Premier Gold Mines. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
We can see that insiders own shares in Premier Gold Mines Limited. It has a market capitalization of just CA$417m, and insiders have CA$13m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checkingif those insiders have been buying.
The general public -- mostly retail investors -- own 51% of Premier Gold Mines . With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability.
With an ownership of 12%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.
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.
But ultimatelyit is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look atthis free report showing whether analysts are predicting a brighter future.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
San Marco Announces the Results of its AGM and Corporate Appointments
Vancouver, British Columbia--(Newsfile Corp. - June 24, 2019) - San Marco Resources Inc. (TSXV: SMN) ("San Marco" or "the Company") announces the results of its annual general meeting held on June 20, 2019.
Tookie Angus, Brian Lock, Andy Carstensen, Craig Prenter and Robert Willis were re-elected as directors of the Company for the next year. Bill Myckatyn did not stand for re-election. San Marco's board thanks Bill for his years of significant contributions to San Marco and wishes him well in his retirement.
Also at the meeting, Dale Matheson Carr-Hilton Labonte LLP, Chartered Professional Accountants, were re-appointed as San Marco's auditor and San Marco's stock option plan was ratified.
Subsequent to the meeting, San Marco's board appointed:
• Tookie Angus as Chairman;
• Robert Willis as Executive Director;
• Christian Grijalva as Chief Operating Officer - Mexico with a mandate to focus on generating mineral property opportunities, primarily in Northern Mexico;
• Fernando Costa as Chief Financial Officer; and
• Michael Provenzano as Secretary.
The Company is expanding its exploration jurisdiction to include Canada, specifically British Columbia. As a result, Robert Willis will, on an interim basis, carry out some of the chief executive responsibilities as well as be involved in all potential growth acquisitions.
Robert Willis, Executive Director, stated, "We see the current junior resource environment as an opportunity to add significant quality assets to San Marco's current property portfolio. Between Chris and I, we expect to build shareholder value in Mexico and Canada, as a culmination of ongoing review, discussion and acquisition negotiations of quality mineral property opportunities."
About San Marco
San Marco Resources Inc. is a Canadian mineral exploration company with a portfolio of promising projects in mining-friendly Mexico, including the Espiritu SMR, Mariana and 1068 Projects in Sonora State.
San Marco actively pursues strategic project generation program focused on high-calibre, low acquisition cost opportunities in Canada and northwestern Mexico. The Company has a committed management team with extensive experience in Mexico and a proven track record of building shareholder value. San Marco currently has 67,916,082 issued and outstanding shares.
On behalf of the Board of Directors,
Robert Willis, B.Sc. P. Eng.Executive Director
For further information, contact:info@sanmarcocorp.com
National Instrument 43-101 Disclosure
The technical information contained in this document has been verified, and this news release has been approved, by San Marco's Executive Director, Robert D. Willis, P. Eng. a "Qualified Person" as defined in National Instrument 43-101, Standards of Disclosure for Mineral Projects of the Canadian Securities Administrators.Forward Looking Information
Information set forth in this document may include forward-looking statements. While these statements reflect management's current plans, projections and intents, by their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond the control of San Marco Resources Inc. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on these forward-looking statements. San Marco's actual results, programs, activities and financial position could differ materially from those expressed in or implied by these forward-looking statements.
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
To view the source version of this press release, please visithttps://www.newsfilecorp.com/release/45781 |
Russia's Rosatom sees foreign revenues, new products fuelling rapid growth
By Katya Golubkova and Gleb Stolyarov
MOSCOW, June 24 (Reuters) - Russian state nuclear company Rosatom aims to triple its revenue in U.S. dollar terms by 2030, driven by foreign projects from Belarus to Bangladesh and new product areas such as carbon fibre, its chief executive told Reuters.
Rosatom is the world's only integrated nuclear firm, providing a one stop shop from uranium enrichment to handling nuclear waste, after its two biggest rivals Areva and Westinghouse hit financial troubles.
Alexey Likhachyov, 58, has led Rosatom since 2016, with goals to increase competitiveness, add new markets and products, and boost its share of global nuclear technology exports.
By 2030, he expects up to 70% of Rosatom's revenue to come from outside Russia and up to 40% from new products, including non-nuclear ones.
"The first step is to implement our entire order book portfolio - this is around $190 billion overall, of which $133 billion is for this decade. Out of these, around $90 billion are (started) plants abroad. This is 12 countries," he said.
Rosatom is the world's biggest nuclear company by foreign orders, with a total of 36 nuclear blocks on order outside Russia, including in Belarus, Bangladesh, China, India, Turkey, Finland, Hungary and Egypt.
"We have already entered some sites and are at quite advanced stages - in Belarus, for example. At some we are accelerating the construction process - these are Bangladesh, Turkey. At some there is a licensing process," Likhachyov said.
"At some this (process) is easier - if we talk about Egypt, at some a bit more complicated, if we talk about Hungary and Finland ... (But by) implementing right on time these (order book) projects, we will get closer to the goals I mentioned."
In 2014, Rosatom's foreign revenue stood at $5.2 billion, or 31% of the total. It is aiming for $15 billion in 2023, or 40%-45% of the total, Likhachyov said.
Rosatom is also interested in the nuclear plans of Argentina and Saudi Arabia, he said. And if the world continues to switch from fossil fuels, Rosatom's foreign revenue may grow even more, Likhachyov said.
Among new products and non-nuclear areas Rosatom is targeting are equipment for the energy sector, safety systems, recycling hazardous industrial waste, as well as new materials such as carbon fibre.
"For carbon fibre, we will try to become one of the world's leading suppliers. The plant is currently being built ... Next year, we want to start commercial supplies, including to our aviation industry," Likhachyov said.
COMPETITION AND COOPERATION
Rosatom has won most major global new-build nuclear contracts over the past decade and has the experience and financial clout to not only sell reactors but also build the entire power plant around them.
Likhachyov said he would welcome more competition from other players, as currently there is not enough. At the same time, partnerships with other countries are needed for the global nuclear industry to develop, he said.
"Alone, no country will create a full-fledged nuclear industry," he said.
Likhachyov said he saw key competition now coming from China and the United States. "China is just trying to start expansion. It is better for us to go together with China to some countries," he said, without mentioning specific projects.
China has ambitions to become a top nuclear vendor, although it has little experience of building reactors abroad. Russia and China are competing for new projects in Argentina.
Likhachyov said Rosatom was moving towards less state support for its day-to-day operations. Last year, such support totalled 68 billion roubles ($1.1 billion) versus 77 billion in 2016.
At the same time, the company invested 250 billion roubles in Russia last year, Likhachyov said.
"But we need to understand that, if we talk about heavy projects in the nuclear industry, such as the Northern Sea Route (NSR) or industrial waste, of course, without support of the state as an anchor investor this is hard," he said.
Likhachyov said the NSR would require about $11.7 billion of investments, with the state budget set to provide about a third and the rest coming from companies and banks.
($1 = 62.8875 roubles) (Reporting by Katya Golubkova and Gleb Stolyarov; Editing by Mark Potter) |
12 Top Napa Valley Wineries to Visit
Whether you want to indulge in deep reds or sip crisp whites, these gorgeous Napa Valley wineries will help you do it in style. From its rich cabernets to its flavorful pinots, Napa Valley is renowned for incredible wine. But the wineries in this area offer more than just their outstanding varietals. Oenophiles can enjoy beautiful grounds with European-inspired architecture, lush vineyard views and unique art installations. To help you choose which properties to visit during your next wine country trip, U.S. News rounded up a list of Napa Valley's best wineries. Read on to see which properties are sure to leave a lasting impression. Rutherford Hill Winery: Rutherford Head off the Silverado Trail, a popular route in the Napa Valley area, to experience Rutherford Hill Winery. This property is known for its full-flavored merlots, which are said to have a chocolate or coffee taste. The beautiful estate is perched on a hill overlooking a valley on the grounds of a nearly 100-year-old olive grove. It also features mile-long caves that house thousands of barrels of maturing wine. Go on a cave tour, which is available multiple times daily (reservations recommended), before enjoying a bring-your-own picnic lunch in the Oak Grove picnic area. Wine tastings start at $30 per person. Chateau Montelena Winery: Calistoga For an uber-romantic experience, stop by Chateau Montelena Winery to explore its dreamy Calistoga grounds and robust wine offerings. Set against Mount Saint Helena, the chateau was built in 1888 to resemble the gatehouse of an English Gothic castle. The structure overlooks a Chinese garden, a lake and the property's vineyards, which are ideal for a romantic stroll. Wine tastings start at $40 per person and range from walk-in options to tastings that accompany an estate or vineyard tour. Must-try wines here include the property's chardonnay and cabernet sauvignon varieties. Clos Pegase: Calistoga Located less than 3 miles southeast of downtown Calistoga, Clos Pegase offers 20,000 square feet of wine caves, vineyards and a tasting room overlooking a garden. Renowned for its iconic postmodern design by architect Michael Graves, the estate is set on a volcanic knoll and contains both the winery and a residence. Visitors will be dazzled by the property's grand entrance, open roof and cypress-lined courtyard. Red wines to try at Clos Pegase include pinot noir and cabernet sauvignon, while rosé and white wines like chardonnay and sauvignon blanc are crowd pleasers as well. Tastings cost at least $30 per person. Chimney Rock: Napa Situated on the Silverado Trail in the Stags Leap District, Chimney Rock features Cape Dutch architecture, which is prominent in Cape Town , Stellenbosch and other Western Cape locales in South Africa. The style includes white stucco exteriors and other distinct elements. Be sure to view the property's ornate wall sculpture of Ganymede -- known in Greek mythology as the cupbearer to the gods -- from the courtyard of the tasting room. Highly regarded for its cabernet sauvignon, Chimney Rock offers a variety of tours with tastings, including a tour of the estate vineyards that provides an overview about winemaking, an estate tour where you can taste wine directly from a barrel and a private tour that ends with a casual lunch. The least expensive option, the Estate Tasting, costs $50 per person. Story continues Stag's Leap Wine Cellars: Napa Head to Stag's Leap Wine Cellars in the city of Napa for a lesson in wine history. Founded in 1970, the company took home the top prize for its cabernet sauvignon in the 1976 Judgement of Paris wine competition. Today, Stag's Leap offers multiple tasting options and is best known for its sauvignon blanc, cabernet sauvignon and merlot vinos. On-site experiences include a wine and food pairing with dishes created by chef Travis Westrope, a tour of the winery and a cave tour through some of the property's more than 34,000 square feet of tunnels, which are centered around a rare Foucault pendulum. Tastings range from $45 to $175 per person. Castello di Amoroso: Calistoga For a wine tasting fit for royalty, stop by Castello di Amoroso in Calistoga. The estate's medieval, Tuscan-style castle features five towers, 100-plus rooms (95 of which are devoted to winemaking) and 1,000-pound doors made in Italy . Plus, the regal property boasts a church, a drawbridge, secret passageways and a loggia, and it has hosted famous visitors like actors Robert Redford and Arnold Schwarzenegger, football star Joe Montana and former Mayor Rudy Giuliani. At Castello di Amoroso, oenophiles have access to a variety of tours and tastings, some of which are paired with cheeses or chocolates. The winery produces all kinds of vinos, including pinot grigio, pinot noir and a Super Tuscan blend. Take a self-guided castle tour and enjoy five wine tastings for $30. Domaine Carneros: Napa Sip wine in a French-inspired chateau at Domaine Carneros, which resembles the 18th-century Château de la Marquetterie in Champagne, France. Enjoy a reservation-only tasting on a terrace that overlooks Napa Valley, or take a seat in the property's salon for table service. The winery's award-winning sparkling wine and pinot noir are standard crowd-pleasers, but those seeking an even more special experience should pay for the Art of Sparkling Wine Pairing or the Sparkling Suite tasting. Each option pairs the bubbly beverages with Asian-themed food or caviar and charcuterie, respectively. Standard wine tastings, which start at $35 per person, are also available daily. Sterling Vineyards: Calistoga Hilltop Sterling Vineyards not only offers visitors fine California wine -- including a highly regarded cabernet sauvignon -- but also fantastic Napa Valley views from its aerial tram (the only one of its kind in the area). This makes Sterling Vineyards a great stop for families with children. The tram ride, which departs every half-hour between 10 a.m. and 4:30 p.m., costs $20 for visitors ages 3 through 20. Guests 21 and older will pay $35 each to ride the tram; the pricier rate also includes a wine tasting and a self-guided tour of the premises. Inspired by the Greek island of Mykonos , the winery features towers with bells from London 's Church of St. Dunstan in the East. Inglenook: Rutherford Francis Ford Coppola and Eleanor Coppola own this winery and chateau in Rutherford. Developed in 1881, Inglenook is home to The Bistro tasting room, caves and a courtyard with a reflecting pool. Kids can sail wooden sailboats in the fountain while adults enjoy tastings paired with artisanal cheeses. Additional experiences like a walking tour of the estate followed by a tasting in a wine cave, and a property tour during a Napa Valley Wine Train outing are available as well. Wine tastings start at $55 per person and may include a sample of the property's signature wine, Rubicon, which is made from cabernet sauvignon grapes originally planted here in the 1880s. The winery also produces wines like syrah and sauvignon blanc. Keep in mind, Inglenook does not permit picnicking. Robert Mondavi Winery: Oakville Best known for its cabernet sauvignon wine and signature Fumé Blanc variety (which is made from sauvignon blanc grapes), Oakville's Robert Mondavi Winery features many unique ways to sample wine and explore its grounds. Patrons can enjoy walk-in tastings starting at $25 per wine flight. Or, oenophiles can spend their visits biking through the vineyard, perusing the property's art collection, seeing the grounds during a twilight tour or eating lunch or dinner paired with several wines. The Mission-style winery, which mimics the old Spanish missions found throughout California, also hosts a concert series every summer. Del Dotto Estate: St. Helena At this Venetian-style estate, wine lovers can sample varietals like cabernet sauvignon and the property's signature vino, The Beast. Del Dotto Estate in St. Helena honors the Del Dotto family's heritage, with elegant wine caves fitted with Italian marble and large chandeliers. In the caves, visitors can enjoy barrel tastings by candlelight with pairings of cheese, chocolate and even pizza. For those with less time to spare, the property offers a 30-minute bar tasting that includes five wine samples and costs $45 per person. But remember, this experience does not take place inside the caves. HALL St. Helena: St. Helena Art lovers would be remiss to leave Napa Valley without visiting HALL St. Helena, a winery that mixes modern artwork with fine wines. To fully immerse yourself in the property's art, book the HALLmark tour, which includes a tour of the grounds and more information about winemaking and some of the winery's artwork. At the end of the tour, you'll enjoy a seated tasting of four award-winning wines in a private salon. The estate is known for its cabernet sauvignon, merlot and sauvignon blanc varieties. If you're a fan of cabernet sauvignon, book the Ultimate Cabernet experience to sample some of the vineyard's best cabernets. Standard wine tastings start at $50 per person, and reservations are recommended. More From US News & World Report Napa Valley Travel Guide 10 Best Wine Vacations 15 Best Hotels in Napa Valley View comments |
AJN Resources Inc. Appoints Klaus Eckhof as President and CEO
Vancouver, British Columbia--(Newsfile Corp. - June 24, 2019) - AJN Resources Inc. (CSE: AJN) (FSE: 5AT) ("AJN") is pleased to announce that it has appointed Mr. Klaus Eckhof as President and CEO.
Mr. Eckhof is a geologist with more than 20 years of experience developing mineral deposits throughout the globe including Africa. Mr. Eckhof worked for Mount Edon Gold Mines Ltd as Business Development Manager before it was acquired by Canadian mining company Teck. In 1994, he founded Spinifex Gold Ltd and Lafayette Mining Ltd, both of which successfully delineated gold and base metal deposits. In late 2003, Mr. Eckhof founded Moto Goldmines which acquired the Moto Gold Project in the Democratic Republic of the Congo. There, Mr. Eckhof and his team delineated more than 20 million ounces of gold and delivered a feasibility study within four years from the commencement of exploration. Moto Goldmines was subsequently acquired by Randgold Resources who poured first gold in September 2013. (600,000 ozs per year producer). Mr Eckhof was also the former Executive Chairman of AVZ Minerals Ltd. AVZ is a mineral exploration company focused on developing the Manono Project, potentially one of the world's largest lithium-rich LCT (lithium, caesium, tantalum) pegmatite deposits. Manono is located in the south of the DRC in central Africa.
Mr. Jag Sandhu has resigned as President and CEO and Director of AJN. The Board thanks Mr. Sandhu for his contributions to AJN.
About AJN Resources Inc.
The Company holds an option to acquire a 100% interest in the Salt Wells Lithium Project (the "Property") in Churchill County, Nevada, USA, subject to a 4.5% net smelter returns royalty. The Company's business objective is to explore for lithium mineralization on the Property. AJN's management and directors possess over 75 years of collective industry experience and have been very successful from exploration, to financing, to developing major mines throughout the world.
www.ajnresources.com
On Behalf of the Board of Directors
Klaus EckhofCEO and Presidentklauseckhof@monaco.mc
To view the source version of this press release, please visithttps://www.newsfilecorp.com/release/45813 |
The Stock Day Podcast Hosts US Nuclear Corp. to Discuss a 777% Increase in DroneRad Sales
PHOENIX, AZ / ACCESSWIRE / June 24, 2019 /The Stock Day Podcast welcomed US Nuclear Corp. (OTC PINK: UCLE) ("the Company"), a company that designs, manufactures and markets branded, full line radiation and chemical detection and specialized advanced tritium technology for the nuclear energy industry, medical and for emerging technological processes. President and CEO, Bob Goldstein, joined Stock Day host Everett Jolly.
Jolly began the interview by noting that the Company's DroneRad sales have increased by 777% over 2018. Goldstein explained that this aspect of the Company is continuing to increase and that an even higher increase is expected for 2019.
Jolly then asked Goldstein to expand on the Company's expected DroneRad sales throughout 2019. Goldstein shared that the Company expects to have a 2,000% increase over 2018 sales, as orders continue to flow in.
Goldstein then explained the Company's CBRN detection system, which stands for "Chemical Biological Radiation Nuclear". He further explained that the Company chose these segments based on the dangers they pose and the interest shown by first responders, military personnel, and border security. The DroneRads are now equipped with sensors for these threats, which can tell whether or not the compounds are present in the air.
Jolly then asked whether or not third-world countries have shown interest in the Company's products. Goldstein stated that the interest has been tremendous in these areas, especially when it comes to testing drinking water for dangerous compounds. "We can improve health and expand supply of known safe drinking water by measuring the various toxic materials in drinking water, lakes, rivers, and in industrial waste.", explained Goldstein.
Jolly followed by noting that the Company has incredible vision, as shown by their expanding portfolio. Goldstein shared that the Company's recent expansions have allowed them to greatly increase their available technologies, including recent developments in the medical isotope space and electric power grid space.
Jolly then asked about the Company's recent addition to their management team, Richard Landry. Goldstein explained that Landry has an investment banking background, as well as a physics background, and is a valuable member of their team. "He's quite experienced and sees a big future for US Nuclear Corp., and he's come here to help us achieve it.", stated Goldstein.
To hear Bob Goldstein entire interview, follow the link to the podcast here:https://audioboom.com/posts/7294945-ceo-robert-goldstein-of-us-nuclear-corp-otcpink-ucle-june-19-update
InvestorsHangoutis a proud sponsor of "Stock Day," and Stock Day Media encourages listeners to visit the company's message board athttps://investorshangout.com/
About US Nuclear Corp.
US Nuclear Corp is a fully-reporting, publicly traded company on the Over-the-Counter Bulletin Board, traded under the ticker symbol UCLE. The Company's operations are principally engaged through its subsidiaries, operating two leading nuclear radiation detection companies, Overhoff Technology Corp. and Optron Scientific Company Inc. The Company designs, manufactures and markets branded, full line radiation detection and specialized advanced tritium technology for the nuclear energy industry and for emerging technological processes such as Thorium and Molten Salt (MSR) reactor technologies both domestically and internationally to customers such as United States Government Agencies, the U.S. Military, Homeland Security, Scientific Laboratories, Universities, Hospitals, nuclear reactor facilities in the United States, China, Canada, South Korea, Argentina, Russia, and others.
Safe Harbor Act
This press release includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995. Actual results may differ from expectations, estimates, and projections and, consequently, you should not rely on these forward-looking statements as predictions of future events. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements involve significant risks and uncertainties that could cause the actual results to differ materially from the expected results.
Investors may find additional information by visitingUS Nuclear Corp. and theSECwebsite.
CONTACT:
US Nuclear Corp. (UCLE)
Robert I. Goldstein, President, CEO, and Chairman
Ph: (818) 883 7043 | Email:info@usnuclearcorp.com
About The "Stock Day"Podcast
Founded in 2013, Stock Day is the fastest growing media outlet for Nano-Cap and Micro-Cap companies. It educates investors while simultaneously working with penny stock and OTC companies, providing transparency and clarification of under-valued, under-sold Micro-Cap stocks of the market. Stock Day provides companies with customized solutions to their news distribution in both national and international media outlets. The Stock Day Podcast is the number one radio show of its kind in America. Stock Day recently launched its Video Interview Studio located in Phoenix, Arizona.
602-441-3474
SOURCE:Stock Day Podcast
View source version on accesswire.com:https://www.accesswire.com/549562/The-Stock-Day-Podcast-Hosts-US-Nuclear-Corp-to-Discuss-a-777-Increase-in-DroneRad-Sales |
Rosatom sees Northern Sea Route costs at 735 bln roubles, Russian budget to provide a third
* Rosatom says Russia needs 3 new icebreakers for NSR by 2030-35
* Russia wants to turn Northern Sea Route into new Suez
* Rosatom bets on larger non-Russian revenue
By Katya Golubkova and Gleb Stolyarov
MOSCOW, June 24 (Reuters) - Russia's ambitious Northern Sea Route (NSR) requires 735 billion roubles ($11.7 billion) in investments, with the state budget to provide a third and the rest to come from companies and banks, the head of state nuclear firm Rosatom, Alexey Likhachyov, said.
Rosatom, the world's top nuclear company in terms of foreign orders, was selected by the Russian government to operate the NSR - the Arctic route Moscow wants to turn into a new Suez - coordinating development of the project among its users.
This month, Rosatom agreed with the Russian Direct Investment Fund, Nornickel, one of the world's top nickel and palladium producers, and DP World, among leading global port operators, on joint development of the NSR.
The firms have yet to agree on how their NSR partnership will work. DP World wants to operate the ports and nearby infrastructure that Russia plans to build, its chief executive told Reuters.
Likhachyov, whose company will also be responsible for nuclear icebreakers that create "roads" through the thick Arctic ice for ships, said the state budget planned to provide 274 billion roubles for the NSR out of the total investment.
The rest, he said, would come from Rosatom, Rosneft , Novatek, Gazpromneft, Gazprom , Nornickel and other future users of the route, as well as via bank loans.
"As soon as we create commercially attractive cargo shipment, people will be ready to invest in roads, railways, ports and terminals as this will become profitable," Likhachyov said.
Novatek, Russia's biggest private gas producer, is already using the route to ship liquefied natural gas (LNG) to Europe and Asia, saving on costs and making its LNG competitive on the global market.
Gazpromneft, Russia's third-biggest oil producer, is also exporting some of its oil via the NSR.
By 2024, if projects involving LNG, gas condensate, oil, coal, precious metals and other goods are implemented by the Russian companies, cargoes totalling around 80 million tonnes per year will be shipped via the NSR to Europe and Asia.
Likhachyov said Russia needed to develop the NSR in a way that allowed transportation costs to create a competitive environment for goods.
"There is no point for Novatek to increase LNG (production) if it does not fit into the global ... competitive zone, along with (the LNG costs of) the United States and other producers," he said.
Russia aims to grow big in LNG exports, matching volumes produced by Qatar, one of the world's top exporters, mainly thanks to Novatek's new projects.
Likhachyov said that for the NSR to fly, users would need to clinch a deal: "We will guarantee shipment of certain volumes at a certain price and you would guarantee supplies of certain volumes ... This is likely to be a price formula."
NEW NUCLEAR ICEBREAKERS
The Zvezda shipyard in Russia's far east, with Rosneft among its shareholders, will build a new class of nuclear icebreaker, the Lider, which should be ready by 2026 to break the thick, arctic ice and allow cargo ships to move year-round.
Likhachyov said a single Lider-class vessel would cover Russia's cargo needs but "to compete with Suez", three Liders were needed by 2030-2035 to maintain a speed of 18-20 km per hour and keep shipping costs stable.
"The NSR has to be international. We cannot create such a colossus only to ship hydrocarbons from our north. This is not businesslike ... If China and India will truly decarbonise, cargoes bound for those countries will grow fast." ($1 = 62.8610 roubles) (Reporting by Katya Golubkova and Gleb Stolyarov; Editing by Dale Hudson) |
MCTC Holdings Announces New Operations - Hemp Cultivator, Unique Powdered Cannabis Beverages and Cannabis IP Development
LOS ANGELES, CA / ACCESSWIRE / June 24, 2019 /MCTC Holdings, Inc. (OTC PINK: MCTC) today updates investors on the new business model for the corporation based on its redirection into the cannabis sector and its pending name change to Cannabis Global, Inc. The reorganized operations will concentrate initially on three major growth areas of the cannabis marketplace: 1) California hemp cultivation, 2) Unique powdered cannabidiol (CBD) and Tetrahydrocannabinol (THC) centric cannabis beverages based on proprietary nano-emulsion technologies targeted at the mass consumer and California recreational markets, and 3) several unique cannabis centric intellectual property development and patents.
Management believes the Company holds a unique set of technologies, a vertically integrated supply chain, exceptional managerial skills, and established access to California cultivation, manufacturing and retail licenses that will allow it to move quickly into some of the fastest growing markets within the overall cannabis sector.
Hemp Cultivation - The Company is in the process of entering the hemp cultivation business via a cultivation operation in Riverside County, California. While hemp cultivation in states such as Colorado, Kentucky, and others, began in earnest last year, cultivation within California has lagged for various reasons, mainly permitting and licensing issues. Land preparation is already underway in conjunction with a landowner in possession of licenses and permits. Management believes there are several advantages of cultivating hemp at the chosen Southern California site, such as an extended growing season, optimal latitude location and most importantly, grandfather water rights with established high volume water wells. The Company plans to release additional information about the hemp cultivation operation over the coming weeks. CEO, Arman Tabatabaei, commented, "Not only have we secured prime land with an abundant of water rights, we have also secured a highly experienced cultivation team that is already on site. With what we think is optimal weather for hemp cultivation and seeds with top-notch genetics, we plan on achieving a result that most hemp cultivators in North America will have a difficult time accomplishing - year round cultivation of high CBD hemp strains."
Powdered CBD Centric Drinks - The Company plans to enter the market for powdered drink mixes that contain CBD and other non-psychoactive cannabinoids. The initial product launch will be for "White Label" products produced for established cannabis brands and retailers. The powdered drink lines will be based on proprietary nano-emulsion technologies that almost completely masks the taste of cannabis and provides higher bioavailability compared to other infusion methods. The Company is planning an initial product launch with six product SKUs. The Company owns all of the necessary equipment and raw materials to manufacture sufficient inventory for a sizeable launch.
Powdered THC Drink Mixes for the California Recreational Market - The Company is planning a new line of powdered THC containing drink mixes to be manufactured and distributed under California's strict cannabis licensing and tracking regulations and protocols. The Company plans to manufacture the unique line of nano-infused beverages utilizing license already held by the Company team members through strategic partnerships and to distribute initially to licensed California dispensaries associated with these team members. The product lines will consist of multiple flavor types, including coffee and tea lines. Mr. Tabatabaei continued, "The beverage industry is certainly about flavor and taste, but success is also significantly based on strong distribution. Within the California recreational cannabis marketplace there is another factor that must be considered - Licenses. We believe we not only have unique infusion technologies, but via our association with corporate directors Edward Manolos and Robert Hymers, we also have immediate access to California manufacturing and distribution licenses, and to an established set of licensed California dispensaries that are seeking innovative products. For these reasons, we believe we will be able to quickly enter this marketplace."
Unique Cannabis Centric Intellectual Property - Members of the Company have developed several unique technologies in the area of cannabinoid delivery systems. The Company plans to seek protection of these technologies and inventions via patent filings. The research and development efforts relative to these inventions have centered on methods to infuse cannabinoids into foods and beverages, and to use non-food infusion systems to deliver cannabinoids to the human body.
"This new company will not only be product focused, but also technology and IP focused. Toward this goal, we have already retained experience patent counsel and we are in the advanced stages of drafting patent applications. We expect novel and proprietary cannabinoid delivery systems and several unique product formulations to be a major component of the Cannabis Global story. We will aggressively develop as much IP as possible in order to position ourselves as a key player in this emerging industry," added CEO Tabatabaei.
The Company plans strict adherence to rules and regulations of the 2018 Farm Bill and strict adherence to all state and local laws and regulations.
About MCTC Holdings, Inc.
MCTC Holdings, Inc. is a Delaware registered publicly traded company. The Company was reorganized during June of 2019 and announced its intent to enter the fast growing cannabis sector and its intent to change its corporate identity to Cannabis Global, Inc. The Company is headed and managed by a group of highly experienced cannabis industry pioneers and entrepreneurs. More information on the Company can be viewed atwww.CannabisGlobalinc.com.
For more information, please contact:
Arman Tabatabaei
IR@cannabisglobalinc.com
Forward-looking Statements
This news release contains "forward-looking statements" which are not purely historical and may include any statements regarding beliefs, plans, expectations or intentions regarding the future. Such forward-looking statements include, among other things, the development, costs and results of new business opportunities and words such as "anticipate", "seek", intend", "believe", "estimate", "expect", "project", "plan", or similar phrases may be deemed "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ from those projected in any forward-looking statements due to numerous factors. Such factors include, among others, the inherent uncertainties associated with new projects, the future U.S. and global economies, the impact of competition, and the Company's reliance on existing regulations regarding the use and development of cannabis-based products. These forward-looking statements are made as of the date of this news release, and we assume no obligation to update the forward-looking statements, or to update the reasons why actual results could differ from those projected in the forward-looking statements. Although we believe that any beliefs, plans, expectations and intentions contained in this press release are reasonable, there can be no assurance that any such beliefs, plans, expectations or intentions will prove to be accurate. Investors should consult all of the information set forth herein and should also refer to the risk factors disclosure outlined in our annual report on Form 10-k, our quarterly reports on Form 10-Q and other periodic reports filed from time-to-time with the Securities and Exchange Commission. For more information, please visitwww.sec.gov.
SOURCE: Microchannel Technologies
View source version on accesswire.com:https://www.accesswire.com/549556/MCTC-Holdings-Announces-New-Operations--Hemp-Cultivator-Unique-Powdered-Cannabis-Beverages-and-Cannabis-IP-Development |
Seacoast Commerce Bank Announces Expansion into Las Vegas, Nevada
SAN DIEGO, CA / ACCESSWIRE / June 24, 2019 /Seacoast Commerce Bank, a wholly owned subsidiary ofSeacoast Commerce Banc Holdings(OTC PINK: SCBH), today announced that its board of directors has approved an expansion plan whereby the bank will open a full-service branch in Las Vegas, Nevada.
Richard M. Sanborn, President and Chief Executive Officer commented, "We are very excited about our expansion plans into Nevada. One of the specialty industries we focus on is the property management industry, and the Nevada Department of Real Estate has very specific rules about where property management firms in Nevada can have certain accounts. In essence, you have to have a physical depository branch in Nevada in order to bank parts of that industry. This new branch will allow us to expand our relationship with many existing clients who we currently bank outside of Nevada, and attract many new clients in Nevada who have been asking for us to open a branch there. We expect to have our new location ready to go in the third quarter of 2019, subject to the customary regulatory process."
AboutSeacoast Commerce Banc Holdings:Seacoast Commerce Banc Holdings is a bank holding company with one wholly owned banking subsidiary, Seacoast Commerce Bank. Both the holding company and the bank are headquartered in San Diego, California, with the Bank having four full-service banking branches in San Diego and Orange County, California, and loan and deposit production offices throughout Arizona, California, Colorado, Georgia, Illinois, Oregon, Massachusetts, Nevada, Texas, Utah, Virginia and Washington.
For more information onSeacoast Commerce Banc Holdings, please visitwww.scbholdings.com; to learn more aboutSeacoast Commerce Bank, visitwww.sccombank.com, or contact Richard M. Sanborn, President and Chief Executive Officer at (858) 432-7001.
Certain statements in this press release, including statements regarding the anticipated development and expansion of the Bank's business, and the intent, belief or current expectations of the Bank, its directors or its officers, are "forward-looking" statements (as such term is defined in the Private Securities Litigation Reform Act of 1995). Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such "forward-looking" statements. These risks and uncertainties include, but are not limited too, risks related to the local and national economy, the Bank's performance and regulatory matters.
SOURCE:Seacoast Commerce Bank
View source version on accesswire.com:https://www.accesswire.com/549560/Seacoast-Commerce-Bank-Announces-Expansion-into-Las-Vegas-Nevada |
Amazon Echo Show 5 review: An Alexa display with alarm clock smarts
When Amazon introduced thesecond-gen Echo Showdisplay last year, it was a huge upgrade over the original, with a built-in browser, better sound and more video options than before. Just months later, however, and Amazon has released a new model called theEcho Show 5(In case that's confusing, the "5" refers to the screen size, much like how Amazon names its Fire tablets).
That might seem odd, but the Echo Show 5 isn't meant to replace the larger Show; it's a smaller version designed for desks and nightstands. Think of it as a squarer, reimaginedEcho Spotthat doubles as competition forGoogle's Nest Hub(and, in a way, theLenovo Smart Clock). It's not perfect by any means, but for those who want a smaller, sleeker Amazon smart display that's also a decent alarm clock, the Echo Show 5 might be it.
If you zapped the 2018 Echo Show with a shrink ray, you'd probably end up with something very similar to the Echo Show 5. It has the same look and feel, with a screen dominating the front and the fabric-wrapped speaker housed in the back. Unlike the larger Show, however, the Echo Show 5 comes in both white ("Sandstone") and black ("Charcoal"), so you can pick one that better suits your home decor. The Show 5's small stature also reminds me of the Lenovo Smart Clock, with similar alarm clock aesthetics.
That's not the only way the Echo Show 5 is reminiscent of the Lenovo Smart Clock. Like the latter, the Echo Show 5 comes with several clock faces and you can smack the top of it to snooze the alarm. There's also a similar sunrise feature, where the display slowly brightens fifteen minutes prior to the set time to mimic the effects of daylight's arrival. The sunrise alarm on the Echo Show 5 is a little unusual however, because it only works when you set the alarm between 4 and 9 a.m. I suppose that's understandable given that's usually when natural sunrise occurs, but I thought the whole point of having a "sunrise alarm" is that it works at all hours, and not just at the appropriate times.
Much like the Smart Clock and Google's Nest Hub, the Echo Show 5 has an ambient light sensor that automatically adjusts the screen's brightness according to its surroundings. Seeing as the Show 5 can be used as an alarm clock, I appreciate that the screen goes dark at night, making it easier to fall asleep.
While the Echo Show 5 may have a lot of the clock-centric features, it's still primarily a smart display; its 5.5-inch screen is certainly a lot bigger than the 3-incher on the Smart Clock. That, along with its 960 by 480 resolution, makes the Echo Show 5 much better suited for photos and video. Images look colorful enough, and I enjoyed watching videos on it despite the small screen. I do think it's a little too tiny for watching longer videos like movies and TV shows, but it was fine for short news clips and music videos. As with other Alexa smart displays, the Echo Show 5 supports video from Amazon Prime, NBC and Hulu. You can also watch YouTube videos via the built-in Silk or Firefox browsers (though it's not as integrated as the YouTube experience on Google's smart displays) and step-by-step cooking videos from sources like SideChef and AllRecipes. Amazon also recently added how-to clips from WikiHow, so you can watch instructional videos like how to open a tight jar, for example.
That said, I still think Google's Nest Hub is a much better choice for displaying photos. Not only is the screen bigger at 7-inches, it's also easier to use. With the Echo Show, I have to go through Settings, Home & Clock, Clock, and Personal Photos so that I could pick my preferred source of images (either the Alexa App, Amazon Photos or my Facebook account). With the Nest Hub, on the other hand, I can pick my Google Photos album with just a few taps in the app. Google's machine-learning algorithms are even smart enough to automatically compile albums of my favorite people and pets while leaving out embarrassing shots and duplicate photos.
Additionally, I like how Google's smart display puts my photos at the forefront without me having to do anything. On the Echo Show, I had to dig through Settings in order to shut off the suggested Trending Topics and Alexa Tips that would otherwise clutter the screen by default. Of course, this is a personal preference -- you might love seeing news headlines all the time -- but I would rather my smart display be a digital photo frame than a depressing news source.
One of the reasons I liked the Nest Hub was its lack of camera; it made me a lot more comfortable having it by my bedside. But even though the Echo Show 5 is meant for personal spaces like the desk and the nightstand, it still has a front-facing camera lens meant for video calls. Unlike its predecessors however, the Echo Show 5 does at least come with a physical camera shutter -- the larger Echo Show and the Echo Spot only have electronic ones. That physical shutter makes me feel a little better about having the Echo Show 5 in my bedroom, but not everyone will feel that way. After all, it's easy to forget to slide that toggle, and it's something that you have to always be mindful of.
Aside from the camera shutter, the Echo Show 5 also has a microphone mute button and a couple of volume controls on the top. Packed inside it is a 1-watt speaker, which emits surprisingly impressive sound for such a tiny device. The bass packs a powerful punch and vocals are beautifully crisp and clear. You have the option of adding additional speakers via a 3.5mm audio jack or stereo Bluetooth, but honestly, I don't think you'll need it.
The Echo Show 5 also features a new Alexa smart display dashboard, which you can reveal by swiping left from the far-right of the screen. The dashboard has six shortcuts to frequently-used skill categories: Communicate (which leads to video calls), Music, Alarms, Video, Smart Home and Skills & Game (the last one is simply a list of popular skill categories).
I ended up using the Smart Home shortcut quite a bit, as it brings up a dashboard of all my connected smart devices like webcams and smart lights. I also plugged in my coffee maker to an Amazon Smart Plug, thus transforming it into a "smart" appliance that I can enable right from the Echo Show. Starting my coffee maker while I was still in bed felt like I was living in the future. It's worth noting here that though the Echo Show 5 does work with the Nest video doorbell, you can't have two-way conversations with them. According to Amazon, the company will work with any developer that implements its two-way API. Right now, that includes Amazon's Ring and Cloud Cams, plus August's doorbell cameras, but not anything from Nest.
The rest of the Echo Show 5's features are pretty much the same as previous Alexa products. I used Alexa to get the weather forecast, check on the latest sports scores, add items to a shopping list and schedule events on my calendar. I also tried out a couple of Alexa Routines, like "Start My Day," which tells me the day's temperature, the current traffic conditions, and the daily headlines. Telling Alexa "Goodnight," on the other hand, shuts off all the smart lights.
One especially notable feature of the Echo Show 5 is its price. The 2018 Echo Show is $230, the Echo Spot is $130, but the new Echo Show 5 is only $90, making it the cheapest of the three. It's also more affordable than the Google Nest Hub, which retails for $130. The Echo Show 5 is about $10 more than the Lenovo Smart Clock, but it's also an actual smart display (rather than just a smart clock) with a lot more features.
With its small form factor and various clock-centric features, the Echo Show 5 is essentially a combination Echo Show and Echo Spot. It's an Alexa smart display squeezed down to alarm clock size, but without sacrificing too much screen real estate that photos and videos can still be enjoyable. I tend to prefer the Nest Hub with its larger screen, smarter photos integration and the lack of camera, but I can definitely see the appeal of the Echo Show 5. If you're an Amazon fan who wants a smart display with solid alarm clock features, then the Echo Show 5 definitely fits the bill. |
All You Need to Know About Amber Road (AMBR) Rating Upgrade to Strong Buy
Amber Road (AMBR) could be a solid addition to your portfolio given its recent upgrade to a Zacks Rank #1 (Strong Buy). This rating change essentially reflects an upward trend in earnings estimates -- one of the most powerful forces impacting stock prices.
The sole determinant of the Zacks rating is a company's changing earnings picture. The Zacks Consensus Estimate -- the consensus of EPS estimates from the sell-side analysts covering the stock -- for the current and following years is tracked by the system.
Since a changing earnings picture is a powerful factor influencing near-term stock price movements, the Zacks rating system is very useful for individual investors. They may find it difficult to make decisions based on rating upgrades by Wall Street analysts, as these are mostly driven by subjective factors that are hard to see and measure in real time.
Therefore, the Zacks rating upgrade for Amber Road basically reflects positivity about its earnings outlook that could translate into buying pressure and an increase in its stock price.
Most Powerful Force Impacting Stock Prices
The change in a company's future earnings potential, as reflected in earnings estimate revisions, and the near-term price movement of its stock are proven to be strongly correlated. That's partly because of the influence of institutional investors that use earnings and earnings estimates for calculating the fair value of a company's shares. An increase or decrease in earnings estimates in their valuation models simply results in higher or lower fair value for a stock, and institutional investors typically buy or sell it. Their bulk investment action then leads to price movement for the stock.
For Amber Road, rising earnings estimates and the consequent rating upgrade fundamentally mean an improvement in the company's underlying business. And investors' appreciation of this improving business trend should push the stock higher.
Harnessing the Power of Earnings Estimate Revisions
As empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock movements, tracking such revisions for making an investment decision could be truly rewarding. Here is where the tried-and-tested Zacks Rank stock-rating system plays an important role, as it effectively harnesses the power of earnings estimate revisions.
The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here >>>>.
Earnings Estimate Revisions for Amber Road
For the fiscal year ending December 2019, this software maker is expected to earn -$0.03 per share, which is a change of 40% from the year-ago reported number.
Analysts have been steadily raising their estimates for Amber Road. Over the past three months, the Zacks Consensus Estimate for the company has increased 2.9%.
Bottom Line
Unlike the overly optimistic Wall Street analysts whose rating systems tend to be weighted toward favorable recommendations, the Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings for its entire universe of more than 4000 stocks at any point in time. Irrespective of market conditions, only the top 5% of the Zacks-covered stocks get a 'Strong Buy' rating and the next 15% get a 'Buy' rating. So, the placement of a stock in the top 20% of the Zacks-covered stocks indicates its superior earnings estimate revision feature, making it a solid candidate for producing market-beating returns in the near term.
You can learn more about the Zacks Rank here >>>
The upgrade of Amber Road to a Zacks Rank #1 positions it in the top 5% of the Zacks-covered stocks in terms of estimate revisions, implying that the stock might move higher in the near term.
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 reportAmber Road, Inc. (AMBR) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Left-Wing Group Announces List Of House Democrats To Unseat
Rep. Cheri Bustos (D-Ill.) has earned progressive enmity in her capacity as head of House Democrats' campaign arm. Roots Action is calling for a primary against her. (Photo: Press Association/Bill Clark/CQ Roll Call) Roots Action, a left-wing group led largely by supporters of Sen. Bernie Sanders (I-Vt.), drafted a report on 15 House members it considers ripe targets for progressive primary challenges, arming the Democratic Party’s populist wing with a new organizing tool as it seeks to unseat a growing number of incumbents. Roots Action, which is calling its analysis “Bad Blues: Some of the House Democrats Who Deserve to Be ‘Primaried,’” hopes the report can serve as a road map and source of encouragement for individuals or groups considering a primary run. The incumbent House members its identifies are: Cheri Bustos of Illinois, who chairs House Democrats’ campaign arm; Jim Cooper of Tennessee; Jim Costa of California; Henry Cuellar of Texas; Eliot Engel of New York; Josh Gottheimer of New Jersey; Jim Himes of Connecticut; Majority Leader Steny Hoyer of Maryland; Derek Kilmer of Washington; Dan Lipinski of Illinois; Gregory Meeks of New York; Brad Schneider of Illinois; Kurt Schrader of Oregon; David Scott of Georgia; and Juan Vargas of California. Below each of the Democrats’ names, Roots Action includes several paragraphs about their policy record making the case for replacing them and the districts they serve in, as well as information about existing efforts to challenge any of the lawmakers. The group plans to send the report to its 1.2 million-member email list, including activists in each of the 15 congressional districts. “It isn’t easy to defeat a Democratic incumbent in a primary. Typically, the worse the Congress member, the more (corporate) funding they get,” Roots Action co-authors Norman Solomon, Sam McCann, Pia Gallegos and Jeff Cohen write in the introduction. “While most insurgent primary campaigns will not win, they’re often very worthwhile ― helping progressive constituencies to get better organized and to win elections later. And a grassroots primary campaign can put a scare into the Democratic incumbent to pay more attention to voters and less to big donors.” Story continues Some of the figures in “Bad Blues” are familiar to progressive activists who follow the news. Bustos earned the enmity of the left as head of the Democratic Congressional Campaign Committee for a March decision to blacklist consultants that work with candidates challenging incumbents. Others, like Meeks, might be less familiar. Meeks, a corporate-friendly opponent of tougher banking policies like the financial transaction tax , succeeded former Rep. Joseph Crowley as chair of the Queens County Democratic Party after Rep. Alexandria Ocasio-Cortez ousted Crowley in a June 2018 primary. Meeks has used his perch as the new boss of the Queens machine to thwart the ascent of the most progressive candidate for Queens district attorney, whose high-profile backers he dubbed “patronizing” to the borough’s black residents. Some of the incumbents have already elicited spirited primary challengers, including Hoyer, Scott, Lipinski, Engel and Cuellar. Still, other members of Congress like Rep. Ron Kind of Wisconsin, whose centrist records have earned them liberal ire, were not on the list of targeted incumbents. The report’s authors noted though that it is “by no means exhaustive ― only illustrative.” Waleed Shahid, a spokesman for Justice Democrats, a group that backed Ocasio-Cortez and now-Rep. Ayanna Pressley in their primary wins last year and has recruited challengers to run against Cuellar and Engel , described the advent of the report as a sign of the times. “The upset victories by Ayanna Pressley and Alexandria Ocasio-Cortez have revealed more enthusiasm for more primary challengers and a different model of representation in the Democratic Party,” he said. “Everyone should be looking over their shoulder.” Also on HuffPost Love HuffPost? Become a founding member of HuffPost Plus today. This article originally appeared on HuffPost . |
Housing Market Continues to Cool and Normalize (May 2019 Market Report)
• The typical U.S. home was worth $226,800 in May, up 5.4% from a year earlier but down 0.1% from April.
• The median monthly U.S. rent is $1,479, up 2.7% year-over-year.
• For-sale inventory in the U.S. fell 0.5% from a year ago, but rose in 23 of the 35 largest U.S. housing markets.
The for-sale and rental housing markets continued to move in opposite directions in May, with home value growth showing gradual slowing and flattening and rent growth showing modest acceleration after a brief period of declines. Both are signs of a normalizing market after years of rapid home value gains.
The U.S. median home value rose 5.4% year-over-year in May, to a Zillow Home Value Index of $226,800, according to the May Zillow Real Estate Market Report. May's annual growth rate is still well above the historic average pace of annual ZHVI growth of 3.8 percent in a given month, but represents a notable slowdown from both the May 2018 rate of 7.5% and the recent high of 8.1% set in December 2018. After a brief acceleration during the last four months of 2018, annual ZHVI growth has slowed compared to the month prior in each of the first five months of 2019.
This national slowdown is echoed in a large majority of the nation's largest housing markets – 33 of the top 35 U.S. markets grew more slowly in May than they did a year ago, with Indianapolis and Cincinnati the only markets bucking the trend. But while most of these large markets have slowed, home values in almost all of them still grew in May – San Jose, Calif., is the lone large market in which home values fell year-over-year, declining 5.7%.
On a monthly basis, the median U.S. home value fell in May, the second straight monthly decline after a stretch of 85 straight months of month-month growth. These monthly declines are notable for their rarity over the past 6+ years, as the housing market came roaring back in the wake of the Great Recession. But their magnitude is fairly minor at this point, and monthly home value growth may be better described as "flattening" rather than meaningfully declining. In March, prior to the past two monthly declines, the median U.S. home was worth $227,200 – just $400 more than currently. As the busy home shopping season enters the summer months and buyers continue to hit the market, even modest monthly growth could easily erase that decline.
Taking a longer-term and higher-level view of the market, the current slowdown in home value appreciation – even the soft declines over the past two months – has long been expected and could be characterized as somewhat welcome in some senses. It has been widely acknowledged that the aggressive pace of home value growth over the past several years was unsustainable. Buyers simply couldn't keep up, and home prices are correcting. This steady return to "normalcy" – something U.S. housing hasn't experienced in two decades – will carry on, and we should expect some continued, but increasingly moderate, volatility. And thesignificant recent drop in mortgage rates, as well as renewed rent growth, may help U.S. home values get back into positive territory sooner rather than later.
While home value growth has slowed, rent prices are accelerating. The U.S. Zillow Rent Index rose 2.7% in May, to $1,479/month. After slowing throughout much of 2018, the annual pace of rent growth has accelerated in each of the first five months of 2019 compared to the month prior. Rent was up compared to May 2018 in all 35 of the nation's largest housing markets, and annual rent growth is currently faster than a year ago in 28 of those 35.
But while rent growth has been speeding up, it is still growing at a largely sustainable pace, slightly below recent annual growth in incomes that has been at or above 3 percent for much of the past year. Sustainable rent growth, coupled with still-tight inventory, means renters may stay tenants longer, keeping rental demand high and rent growth on a manageable upward trajectory. Renters comfortable in their apartments may be more able to cover rent increases, and could choose to stay renting longer than they otherwise might have. And a lack of inventory – especially at the entry-level end of the market – means it may take longer for many potential buyers to find the right home for them, also keeping them renters longer.
There were 1,584,512 U.S. homes listed for sale in May, down a scant 0.5% from a year ago, though inventory was up year-over-year in roughly two thirds (23/35) of the nation's largest metro markets. For-sale inventory grew the most in Las Vegas (up 41.8% year-over-year), San Jose (40.6%), Denver (25%), Seattle (23.9%) and San Francisco (21.4%).
After an almost 4-year stretch in which U.S. inventory fell continuously year-over-year in every month, the number of homes available for sale appears to have hit bottom but not yet begun to rebound. Instead of moving decisively in one direction or another, over the past 8-12 months inventory has been bouncing up and down by small amounts. Some of this stabilization in inventory is coming from homes staying on the market longer, rather than growth in new listings. In April (the latest month for which data is available), the typical home spent 70 days on the market before selling, up modestly from 67 days in April 2018.
Critically, despite this relative recent stability in inventory, the number of homes available for sale remains far more constrained at the bottom/entry-level market segment than at the top, creating additional pressure and competition among first-time and/or lower-income buyers. There were more than twice as many high-end homes available for sale in May than there were entry-level homes. Almost half (46.7%) of all homes available for sale nationwide were in the top tier; a little more than a fifth (22.3%) of available inventory was priced in the bottom third of all homes.
The postHousing Market Continues to Cool and Normalize (May 2019 Market Report)appeared first onZillow Research. |
Why You Should Like Petards Group plc’s (LON:PEG) ROCE
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Today we are going to look at Petards Group plc (LON:PEG) to see whether it might be an attractive investment prospect. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.
First up, we'll look at what ROCE is and how we calculate it. Second, we'll look at its ROCE compared to similar companies. Finally, we'll look at how its current liabilities affect its ROCE.
ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. All else being equal, a better business will have a higher ROCE. Overall, it is a valuable metric that has its flaws. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Petards Group:
0.14 = UK£1.2m ÷ (UK£15m - UK£5.7m) (Based on the trailing twelve months to December 2018.)
Therefore,Petards Group has an ROCE of 14%.
Check out our latest analysis for Petards Group
One way to assess ROCE is to compare similar companies. Using our data, we find that Petards Group's ROCE is meaningfully better than the 9.6% average in the Software industry. We would consider this a positive, as it suggests it is using capital more effectively than other similar companies. Regardless of where Petards Group sits next to its industry, its ROCE in absolute terms appears satisfactory, and this company could be worth a closer look.
Petards Group's current ROCE of 14% is lower than 3 years ago, when the company reported a 20% ROCE. This makes us wonder if the business is facing new challenges.
When considering ROCE, bear in mind that it reflects the past and does not necessarily predict the future. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is, after all, simply a snap shot of a single year. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company.
Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To counteract this, we check if a company has high current liabilities, relative to its total assets.
Petards Group has total assets of UK£15m and current liabilities of UK£5.7m. As a result, its current liabilities are equal to approximately 39% of its total assets. Petards Group has a medium level of current liabilities, which would boost the ROCE.
While its ROCE looks good, it's worth remembering that the current liabilities are making the business look better. Petards Group looks strong on this analysis,but there are plenty of other companies that could be a good opportunity. Here is afree listof companies growing earnings rapidly.
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
UPDATE 2-Swiss ready to retaliate against EU over stock market access
(Adds comment from Aquis and Cboe Europe)
ZURICH, June 24 (Reuters) - The Swiss government said on Monday it was ready to ban stock exchanges in the European Union from trading Swiss shares -- intensifying a row over a stalled partnership treaty.
The move followed the EU not extending stock market equivalence to Switzerland after Brussels grew frustrated with Swiss foot-dragging over the long-discussed agreement.
Bern said in response it would withdraw recognition from trading venues in the EU from July 1 to "protect the Swiss stock exchange infrastructure in the event of non-extension".
"Trading venues in the EU would thus be prohibited from offering or facilitating trading in certain shares of Swiss companies from that date," the Swiss government said in a statement.
The EU refrained from extending stock market equivalence, due to expire at the end of June, because the Swiss did not endorse a partnership treaty with the EU that had been negotiated for years, a diplomat told Reuters on Friday.
Granting stock market equivalence is the EU's major leverage in trying to get the Swiss to finally sign off on an agreement governing ties, but Switzerland's foreign minister has said repeatedly that Bern will not be rushed into any deal although it remains open for talks.
Bern's request this month for "clarifications" on three areas - protecting wages, regulating state aid and defining the rights of EU citizens in Switzerland -- is seen in Brussels as demands to reopen the treaty text, which the EU refuses to do.
SIX, the operator of the Swiss bourse, said it welcomed the Swiss decision to activate the protective measures, as this meant EU market participants could still access the Swiss domestic market and continue to be able to trade Swiss shares directly at SIX.
Pan-European stock trading platform Aquis Exchange Plc said; "If equivalence is not extended, and if the Swiss Federal Department of Finance (FDF) rescinds recognition of EU trading venues for the trading of Swiss securities, then Aquis Exchange will take the necessary steps to comply with the directive."
It also said it will only implement the removal of Swiss securities if there is a formal notice from the Swiss FDF.
Another pan-European share trading platform, Cboe Europe , said; "In the event that Switzerland is not granted equivalence from the EU by June 30, Cboe Europe will not be permitted to admit to trading securities with a Swiss registered office and listed on a Swiss exchange with effect from the start of trading on July 1." (Reporting by John Revill in Zurich and Huw Jones in London, editing by Ed Osmond) |
Factbox: U.S.-India trade, e-commerce disputes likely to top Pompeo's New Delhi agenda
By Neha Dasgupta
NEW DELHI (Reuters) - U.S. Secretary of State Mike Pompeo will visit India from Tuesday for talks with government leaders over a growing list of trade and investment issues that has cast a shadow over ties between the two big democracies.
Pompeo is expected to lay the ground for a meeting between U.S. President Donald Trump and Indian Prime Minister Narendra Modi later in the week at a G20 meeting in Japan.
Both countries are trying to promote domestic manufacturing.
Under a "Make in India" campaign, Modi has been courting foreign investors. Trump has pushed for U.S. manufacturing to return home as part of his "Make America Great Again" campaign.
The two countries also have differences over Russian arms sales to India and U.S. sanctions on China's Huawei Technologies Co Ltd.
TARIFFS, CLOSED MARKETS
India this month imposed higher tariffs on 28 U.S. products including almonds, apples and walnuts, following the U. S. withdrawal of certain trade privileges for India.
Last year, India had announced tariffs in retaliation to higher U.S. import duties on steel and aluminium.
Trump has called India "tariff king", and pointed to 50% duties on Harley Davidson motorbikes as an example. The Trump administration has also asked India to remove price caps on imported U.S. medical devices, open up its dairy market and cut duties on IT products.
DATA LOCALISATION, E-COMMERCE
India has mandated foreign firms to store their payments data locally, hurting companies such as Mastercard and Visa.
The United States has been pushing for data flow across borders in several countries including India. This week, India has been alarmed at the possibility of caps on H-1B work visas that allow thousands of skilled Indians to work in the United States, as retaliation for its data localisation drive. The State Department, though, has said there were no such plans.
India outlined a new draft policy for its e-commerce sector this year, focusing on data localisation, improved privacy safeguards and measures to combat the sale of counterfeit products.
Tighter e-commerce foreign investment rules implemented in India in February have forced Amazon.com Inc and Walmart Inc to rework their business strategies in the country. Walmart last year invested $16 billion in Indian online retailer Flipkart.
HUAWEI
The United States has put China's Huawei on an export blacklist citing national security issues, barring U.S. suppliers from selling to the world's largest telecommunications equipment maker and second-biggest maker of smartphones, without special approval.
It is asking its allies to adopt shared security and policy measures that will make it more difficult for Huawei to dominate 5G telecommunications networks. India has not decided whether to invite the Chinese firm for 5G trials.
RUSSIA'S S-400 MISSILE SYSTEM
The United States has said that India's plan to buy S-400 surface-to-air missile systems from Russia would draw sanctions under its Countering America's Adversaries Through Sanctions law. India, which signed the deal last year, says the weapons are necessary to bolster defences against China.
(Compiled by Neha Dasgupta; Editing by Robert Birsel) |
Petards Group plc's (LON:PEG) Earnings Dropped -7.6%, Did Its Industry Show Weakness Too?
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After looking at Petards Group plc's (LON:PEG) latest earnings announcement (31 December 2018), I found it useful to revisit the company's performance in the past couple of years and assess this against the most recent figures. As a long term investor, I pay close attention to earnings trend, rather than the figures published at one point in time. I also compare against an industry benchmark to check whether Petards Group's performance has been impacted by industry movements. In this article I briefly touch on my key findings.
See our latest analysis for Petards Group
PEG's trailing twelve-month earnings (from 31 December 2018) of UK£1.1m has declined by -7.6% 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 52%, indicating the rate at which PEG is growing has slowed down. Why is this? Well, let’s take a look at what’s occurring with margins and if the whole industry is experiencing the hit as well.
In terms of returns from investment, Petards Group has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 8.0% exceeds the GB Software industry of 4.1%, indicating Petards Group has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Petards Group’s debt level, has declined over the past 3 years from 20% to 14%.
Petards Group's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that are profitable, but have capricious earnings, can have many factors affecting its business. I suggest you continue to research Petards Group to get a more holistic view of the stock by looking at:
1. Financial Health: Are PEG’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
2. Valuation: What is PEG 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 PEG 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.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 2018. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
3 Big Stock Charts for Monday: Medtronic, Paychex and AbbVie
Traders were willing to buoy the market up to April’s record highs on Thursday of last week, but no more. TheS&P 500lost 0.13% of its value on Friday, leaving most market participants wondering if the surprisingly bullish June to date is nothing more than a mirage.
Source:Allan Ajifo via Wikimedia (Modified)
Altria Group(NYSE:MO) was arguably the biggest drag, off 4.5% ondoubts that its much-lauded Juul e-cigarette brand would be able to secure the needed approval of the Food and Drug Administrationwhen those products have to get the regulatory agency’s green lights. Pot stockCanopy Growth(NYSE:CGC) was the bigger disappointment though. It fell more than 8% after investors had a chance to parse the details of Thursday afternoon’s quarterly earnings report.Sales of recreational marijuana fell, sequentially, when they’re supposed to continue rising on the wake of recent legalization in Canada.
Overstock(NASDAQ:OSTK) did more than its part to keep the market in the black, gaining 15% in response to reports that a couple of potential buyers weremulling the purchase of its e-commerce arm, which is being shed so the company can focus on cryptocurrency.
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It just wasn’t enough.
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Headed into Monday’s trading, however, it’s the stock charts ofAbbVie(NYSE:ABBV),Paychex(NASDAQ:PAYX) andMedtronic(NYSE:MDT) that merit the closest looks. Here’s why, and what to look for.
In late April it was noted that AbbVie was beingsqueezed into the tip of a converging wedge pattern, formed by a horizontal support line that had been holding up since October, and a falling resistance line that extended back to last May’s high. Although the odds favored a bullish outcome despite the trajectory, it was clear that anything could happen. Waiting on one side or the other to flinch was the key.
We’re still waiting. Although ABBV shares slipped below that key floor a couple of times in the meantime, the floor mostly remains intact. Some new falling resistance lines have since come into play, though the old one marked with a dashed blue line remains part of the equation. Either way, we’re getting closer to a decision, if only because there’s not much room left to meander between support and resistance.
Click to Enlarge
• The floor, of course, is still the support area right around $77, marked in yellow on both stock charts, though you could make the case that a slightly declining one has since materialized. It’s plotted in red.
• It became noteworthy again on Friday just because of the amount of bullish volume that materialized.
• While the bulls may be pushing again, it’s clear they’re struggling just to break above the gray 100-day moving average line that has quelled a couple of rally efforts since early April.
Back in March welooked at Medtronicas it was toying with the idea of a major break above a resistance line around $94, plotted in blue on the daily chart. That didn’t happen … at least not right away. As it turns out, MDT would have to peel back one more time and then try again. This month’s effort did the job.
The speed and distance of that move, however, has also spurred concerns that this usually volatile name is already due for some profit-taking again. When one takes a step back and looks at the longer-term view, however, it’s clear there’s room for a bit more upside until the upper boundary of a major trading range is encountered again.
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Click to Enlarge
• The upper part of the weekly chart’s bullish trading range is right around $110, but rising.
• On that same weekly chart we see a relatively new bullish MACD crossover in conjunction with a push up and off the lower edge of the long-term trading channel, suggesting this effort’s got some “oomph.”
• In the meantime, last week’s high of right around $100, marked with a yellow line, shouldn’t be taken lightly. That’s more or less where Medtronic shares peaked a couple of times in the last part of last year.
Finally, with nothing more than a quick glance at the Paychex chart, it appears the stock is still in an uptrend, though a slowing one. And, perhaps that benign outcome is what lies ahead. Only time will tell.
But, given the sheer scope of the rally since late last year, the slowdown is concerning simply because it may point to an outright reversal into a downtrend. The pump for such a pullback is certainly primed. The good news is, we know exactly where the make-or-break lines are, and what they are.
Click to Enlarge
• It hasn’t come into play yet, but at the current rate of things, it will soon. That is, the purple 50-day moving average line at $84.98 may or may not keep PAYX propped up on its next, impending test as support.
• Zooming out to the weekly chart we can see just how unusual the past six months have been. Paychex should have rolled over in March somewhere around $79, at the upper boundary of an established trading range.
• We have not yet seen a bearish MACD crossunder in the weekly timeframe, but we’re getting closer. That will likely coincide with a break below the 50-day average line.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site,jamesbrumley.com, orfollow him on Twitter, at @jbrumley.
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Are Paradox Interactive AB (publ) (STO:PDX) Investors Paying Above The Intrinsic Value?
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Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Paradox Interactive AB (publ) (STO:PDX) as an investment opportunity by taking the expected future cash flows and discounting them to their present value. I will be using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. 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 Paradox Interactive
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. 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, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF (SEK, Millions)", "2019": "SEK256.57", "2020": "SEK427.90", "2021": "SEK519.33", "2022": "SEK590.24", "2023": "SEK647.42", "2024": "SEK692.16", "2025": "SEK726.55", "2026": "SEK752.77", "2027": "SEK772.76", "2028": "SEK788.13"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x3", "2020": "Analyst x3", "2021": "Analyst x3", "2022": "Est @ 13.65%", "2023": "Est @ 9.69%", "2024": "Est @ 6.91%", "2025": "Est @ 4.97%", "2026": "Est @ 3.61%", "2027": "Est @ 2.66%", "2028": "Est @ 1.99%"}, {"": "Present Value (SEK, Millions) Discounted @ 6.14%", "2019": "SEK241.73", "2020": "SEK379.85", "2021": "SEK434.36", "2022": "SEK465.12", "2023": "SEK480.67", "2024": "SEK484.18", "2025": "SEK478.85", "2026": "SEK467.44", "2027": "SEK452.11", "2028": "SEK434.44"}]
Present Value of 10-year Cash Flow (PVCF)= SEK4.32b
"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. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 10-year government bond rate of 0.4%. We discount the terminal cash flows to today's value at a cost of equity of 6.1%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = kr788m × (1 + 0.4%) ÷ (6.1% – 0.4%) = kr14b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= SEKkr14b ÷ ( 1 + 6.1%)10= SEK7.65b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is SEK11.97b. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of SEK113.35. Compared to the current share price of SEK149.8, the company appears reasonably expensive at the time of writing. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the 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 Paradox Interactive 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 6.1%, which is based on a levered beta of 0.957. 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 Paradox Interactive, I've put together three relevant aspects you should further examine:
1. Financial Health: Does PDX 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 PDX'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 PDX? 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. |
Meghan Markle spoofed by BBC in 'racist' segment
The BBC has been labelled racist by Meghan Markle's fans as part of an upcoming comedy segment. [Photo: Getty Images] The BBC has been labelled ‘racist’ after it parodied and poked fun at Meghan Markle in an upcoming foul-mouthed sketch. The segment, which will feature on spoof programme Tonight With Vladimir Putin , the Duchess of Sussex was portrayed as ‘trailer trash’ who threatens to attack the Duchess of Cambridge . Meghan appears in the sketch as a doll, wearing a black dress. When asked “what makes you angry?” Meghan is seen referencing a scenario where Kate ‘asked to borrow her hairbrush’. “I say no because that’s gross and then I leave my room and come back and I can tell she’s used my hairbrush anyway because it’s covered in skanky hair that’s going grey and I say, ‘Stay the f**k out of my trailer or I’ll cut you, Kate,’” Meghan’s puppet yelled. The duchess’ tumultuous relationship with her father Thomas Markle was also tapped into when one audience member asked Meghan “how’s your dad?” “Great question. Next,” she responded. READ MORE: Meghan and Harry 'very excited' to set up their own charity foundation The upcoming segment, will feature on spoof program Tonight With Vladimir Putin, where the Duchess of Sussex was portrayed as ‘trailer trash’ who threatens to attack Kate Middleton. [Photo: BBC] After another audience member asked what it was like being married to Prince Harry and Meghan’s caricature hit back and asked the woman “why you’re so interested there, missy?” “We can go right now, bi**h, you and me,” she added. This is racist. Full stop. I will not support BBC again. It gross. — Midnight sunshine (@Midnightsunshi4) June 22, 2019 I sent mine. Do not hesitate to send your complaints to @BBC . Darkening Meghan markle’s skin to Portray her as an angry trailer trash with a knife. Is racist,disgusting,disrespectful to every single black men and women. #meghanmarkle #Sussexsquad #BBC pic.twitter.com/lqQQWd5Ne6 — Clematismeghan (@clematismeghan) June 23, 2019 Royal fans were quick to slam the public broadcaster as ‘racist’ and ‘disgusting’. Story continues “This genuinely might be the worst thing the BBC has ever put on TV,” wrote one angered viewer on Twitter. “Bloody hell @bbccomedy what are you doing!? I'm not a @RoyalFamily fan but this is #Disgraceful, #disgusting and #racist,” quipped another. Meghan Markle has largely stayed out of the spotlight since giving birth to baby Archie last month. [Photo: Getty Images] “They darkened Meghan Markle’s skin, gave her a more ‘ghetto voice’ [and] changed her attitude to angry.” While the backlash has been swift, the segment is far from the first time the BBC has rubbed Meghan’s staunch supporters the wrong way. Just last month radio host Danny Baker was fired from the service after he tweeted a photo comparing the royal baby to a chimpanzee. |
Lewis Hamilton wants new F1 leader to come from out of the sport to address ‘mess’ in dent to Toto Wolff’s hopes
Lewis Hamilton has called for Formula One 's next chief to come from outside of the sport, ruling his own boss out from taking the job for potentially being "biased" towards Mercedes . Hamilton was deeply critical of how the sport is being run, describing it as a "mess" following his latest victory in a drab French Grand Prix . The futures of Liberty Media 's American duo - F1 chief executive Chase Carey, and the sport's commercial boss Sean Bratches - are unclear. Jean Todt, who rejuvenated Ferrari and oversaw Michael Schumacher's run of dominance at the turn of the century, is serving what could be his final term as FIA president. Mercedes team principal Toto Wolff is thought to be under consideration by Liberty to lead F1 from 2021. The Austrian is this year on course to take the all-conquering Silver Arrows to an unprecedented sixth straight drivers' and constructors' double. But Hamilton, who has credited Wolff for much of his recent success, said: "While I don't believe there is a better manager than Toto within the whole of Formula One, we as humans can be biased. "You have got Jean Todt. I know Jean is level but he was with the red team for so long. Surely, when he wakes up and there is a red shirt or a silver shirt, he probably goes for the red one. "Just like when I see the number six [Nico Rosberg's former race number], or the number 44, [Hamilton's race number] I go for 44. "Toto has been Mercedes through and through for such a long period of time. "It would be best to get someone from outside who is neutral and doesn't know about Ferrari for instance." Hamilton's remarks arrived against the backdrop of a fans' backlash following Sunday's race which the Briton dominated from start to finish . The world champion has won six of the eight rounds this year. His Mercedes team are unbeaten. The 34-year-old was in Paris last week for an emergency summit among the sport's stakeholders. The meeting was called to determine how F1 will look when the current Concorde Agreement expires in 18 months. Story continues It was decided that the terms of the new arrangement will be delayed until October with the 10 teams failing to reach consensus. Lewis Hamilton believes F1 needs a swift change of direction to save its future (EPA) But Hamilton believes both F1 and the FIA, motor sport's governing body, should take the decision-making process out of the teams' hands. "The way it is set up, just from watching when I was there in Paris, is not good," added Hamilton. "It is really not good, and they will not like me saying that. "I see the mess that we're in, I see it every year. "The FIA are the governing body and they need to be making all the decisions. The teams shouldn't be involved in that. "The teams all want something for themselves. It would be the same in football - they would push and pull for their own benefit. "But if you have a central group of people, like the FIA, their sole job with Liberty is to make the sport great again. They should just have the power, and they should make the decisions." However, Hamilton has raised doubts over the 2021 proposals. He said the cars should be lighter and more nimble, ensuring drivers can push to the limit. Hamilton is worried that F1's plans for bigger and heavier cars is a step in the wrong direction (Getty) The Briton added: "They are talking about the cars being heavier and that baffles me. The cars are already 130 kilograms heavier than when I first got into the sport. "That would be worse for the brakes and the car. We would have to save more fuel. "I have got to realise the position and responsibility I have as the (current) driver who has won the most world championships. "I have been here a long time and for my legacy I would love to look back and say I was a part of helping that positive change for the fans who are watching Formula One. "I don't want to be a driver who just won titles, but one who actually cared about the sport." PA |
U.S. Crude Hits Highest Weekly Gain in 30 Months: 5 Picks
After fears of global economic slowdown and higher supply -- especially from the United States -- subdued crude oil prices for a month and a half, a turnaround showed up last week on heightened geopolitical conflict with Iran.Disturbances in Iran intensified on Jun 13, when two oil tankers were set on fire in the Strait of Hormuz, for which the United States blamed Tehran. On Jun 20, Iran’s Revolutionary Guard claimed that it recently shot down a U.S. drone near the Strait of Hormuz. Iran alleged that the drone had entered its sky, which the U.S. military claimed as international airspace.On Jun 21, President Donald Trump tweeted “Iran made a very big mistake!” although the United States refrained from conducting military strike on Iran, Trump said that the United States would impose “major additional sanctions” against Iran on Jun 24. Notably, Iran is already facing U.S. sanctions regarding crude oil exports after the Trump administration withdrew from Iran Nuclear Agreement of 2015.Crude Oil Prices JumpOn Jun 21, the U.S. benchmark West Texas Intermediate (WTI) crude gained 0.6% to settle at $57.43 a barrel. Global benchmark Brent Crude was up 1.1% to settle at $65.14 a barrel. The WTI crude jumped more than 9% in the past week, marking its largest weekly gain since December 2016. The Brent recorded the first weekly gain after five weeks.Iran Conflict Likely to Escalate FurtherThe intensifying friction between the two countries could disrupt the shipment of crude through the Strait of Hormuz, responsible for the passage of 20% of total crude oil being consumed globally, per media reports. Through the strait, the majority of the crude volumes of countries like Kuwait, UAE, Iraq and Saudi Arabia are exported.It goes without saying that while the Saudis and the United States are on one side, the Houthi Yemenis and Iran make the other. Iran has reportedly warned that if its economy is hit due to America’s sanction on its crude export, it will then attempt to disrupt the passage of oil tankers through the strait. This could further constrain global oil supply. The news in fact has already bumped up oil prices. (Read More: Trump Warns Iran for Drone Attack: Oil Stocks in Spotlight)Global Demand for Crude Oil Remains FirmOn Mar 11, the IEA projected that global crude oil demand will remain firm at least up to 2024 although the rate of demand growth will decline. By this time, demand for oil will rise by 7.1 million bpd.Despite a surge in sales of electric cars and massive oil exploration in the United States, demand for oil is expected to rise in the petrochemical industry, especially in the plastic industry. Also, growing demand for aviation oil will support crude oil prices.Moreover, geopolitical conflicts in major oil-exporting countries like Iran, Venezuela and Libya will push crude oil prices to a great extent. Several industry watchers have estimated that more sanction on oil supply from Iran may witness crude oil price to touch even $100 per barrel.Our Top PicksCrude oil prices are likely to remain northbound in the near term. Consequently, investment in oil exploration and production stocks should be lucrative. We have narrowed down our search to five such firms with a Zacks Rank # 1 (Strong Buy) or 2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.The chart below shows price performance of our five picks in the last three months.
Anadarko Petroleum Corp.APC engages in the exploration, development, production, and marketing of oil and gas properties. It operates through three segments: Exploration and Production, WES Midstream, and Other Midstream. It sports a Zacks Rank #1. The company has an expected earnings growth rate of 19.5% for the current year. The Zacks Consensus Estimate for the current year has improved 14.4% over the past 60 days.Hess Corp.HES explores, develops, produces, purchases, transports, and sells crude oil, natural gas liquid and natural gas. It operates through two segments, Exploration and Production, and Midstream. It carries a Zacks Rank #2. The company has an expected earnings growth rate of 120.3% for the current year. The Zacks Consensus Estimate for the current year has improved 215.4% over the past 60 days.Panhandle Oil and Gas Inc.PHX acquires, develops, and manages oil and natural gas properties in the United States. It produces and sells natural gas, crude oil, and natural gas liquids. It carries a Zacks Rank #2. The company has an expected earnings growth rate of 138.2% for the current year. The Zacks Consensus Estimate for the current year has improved 415% over the past 60 days.Chevron Corp.CVX engages in integrated energy, chemicals, and petroleum operations worldwide. It operates in two segments, Upstream and Downstream. It holds a Zacks Rank #2. The company has an expected earnings growth rate of 23% for the next year. The Zacks Consensus Estimate for the current year has improved 1.4% over the past 60 days.Approach Resources Inc.AREX is an independent energy company, focusing on the acquisition, exploration, development, and production of unconventional oil and gas reserves. It holds a Zacks Rank #2. The company has an expected earnings growth rate of 50% for the current year. The Zacks Consensus Estimate for the current year has improved 33.3% over the past 60 days.More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportChevron Corporation (CVX) : Free Stock Analysis ReportApproach Resources Inc. (AREX) : Free Stock Analysis ReportAnadarko Petroleum Corporation (APC) : Free Stock Analysis ReportHess Corporation (HES) : Free Stock Analysis ReportPanhandle Royalty Company (PHX) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Jeremy Hunt refuses to explain why he wants to reduce the legal abortion limit from 24 to 12 weeks
Jeremy Hunt dodged questions on abortion on Good Morning Britain (Picture: ITV) Jeremy Hunt has refused to say on live television why he wants to reduce the legal abortion limit. The Tory leadership candidate, who is competing against Boris Johnson to be Britains next prime minister , has expressed the view in the past that the legal limit on abortion should be reduced from 24 weeks to 12 weeks. His standpoint has been criticised by womens rights campaigners and his fellow MPs. Mr Hunt was questioned about his stance again on ITVs Good Morning Britain on Monday. He was asked by co-host Piers Morgan: Just out of interest, why is it your view the law should be reduced halved from 24 weeks to 12? But Mr Hunt refused to be drawn on the question, saying it wasnt something he planned on changing if chosen as the next prime minister. 'It would be fine to get into that discussion if it's something I wanted to change as PM, but I don't.' @Jeremy_Hunt refuses to explain his views on abortion when asked why the abortion time limit should be reduced from 24 weeks to 12. @susannareid100 | @piersmorgan #GMB pic.twitter.com/58fKWYUaHA Good Morning Britain (@GMB) June 24, 2019 He said: It would be fine to get into that discussion if it was something I wanted to change as prime minister, but I dont. Its a personal view. Its a free vote matter in the House of Commons and the House of Commons isnt going to change its mind. But Mr Morgan then asked: Isnt it strange that the guy who wants to be prime minister has this view but wont explain why he has it? Read more Men jailed after filming dogs mauling badgers to death in act of 'medieval barbarity' Story continues 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 responded: Well, hes on your show. Hes answering questions about it. Hes being very honest about what his view is but hes also saying that because hes not going to be changing the law as prime minister, nothings going to change. When Mr Morgan again pressed him for an opinion, Mr Hunt replied: Because its got nothing to do with what I want to do as prime minister of this country. Jeremy Hunt's view on abortion has angered women's rights campaigners (Picture: PA) Im not going to seek to change the law and when I was health secretary for longer than anyone else I didnt seek to change the law. Its not relevant to what I want to do as prime minister. Mr Hunts refusal to answer the question came after he urged his rival, Mr Johnson, to be more upfront with the media. ---Watch the latest videos from Yahoo UK--- |
Trump says Fed 'blew it': Twitter
WASHINGTON (Reuters) - U.S. President Donald Trump again criticized the Federal Reserve on Monday for not cutting interest rates, keeping up his pressure on the central bank to change its policies.
"Despite a Federal Reserve that doesn’t know what it is doing - raised rates far to fast (very low inflation, other parts of world slowing, lowering & easing) & did large scale tightening, $50 Billion/month, we are on course to have one of the best Months of June in U.S. history," he wrote on Twitter.
"Think of what it could have been if the Fed had gotten it right. Thousands of points higher on the Dow, and GDP in the 4’s or even 5’s. Now they stick, like a stubborn child, when we need rates cuts, & easing, to make up for what other countries are doing against us. Blew it!"
The U.S. president has repeatedly accused the Federal Reserve led by Chairman Jerome Powell of undermining his administration’s efforts to boost economic growth and has repeatedly demanded that rates be cut.
The U.S. Federal Reserve last Wednesday signalled interest rate cuts beginning as early as July, saying it is ready to battle growing global and domestic economic risks as it took stock of rising trade tensions and growing concerns about weak inflation.
(Reporting by Doina Chiacu; Editing by Chizu Nomiyama) |
Does This Valuation Of Paradox Interactive AB (publ) (STO:PDX) Imply Investors Are Overpaying?
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Today we will run through one way of estimating the intrinsic value of Paradox Interactive AB (publ) (STO:PDX) by estimating the company's future cash flows and discounting them to their present value. I will use the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
We generally believe that a company's value is the present value of all of the cash it will generate in the future. However, a DCF is just one valuation metric among many, and it is not without flaws. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model.
Check out our latest analysis for Paradox Interactive
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars:
[{"": "Levered FCF (SEK, Millions)", "2019": "SEK256.57", "2020": "SEK427.90", "2021": "SEK519.33", "2022": "SEK590.24", "2023": "SEK647.42", "2024": "SEK692.16", "2025": "SEK726.55", "2026": "SEK752.77", "2027": "SEK772.76", "2028": "SEK788.13"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x3", "2020": "Analyst x3", "2021": "Analyst x3", "2022": "Est @ 13.65%", "2023": "Est @ 9.69%", "2024": "Est @ 6.91%", "2025": "Est @ 4.97%", "2026": "Est @ 3.61%", "2027": "Est @ 2.66%", "2028": "Est @ 1.99%"}, {"": "Present Value (SEK, Millions) Discounted @ 6.14%", "2019": "SEK241.73", "2020": "SEK379.85", "2021": "SEK434.36", "2022": "SEK465.12", "2023": "SEK480.67", "2024": "SEK484.18", "2025": "SEK478.85", "2026": "SEK467.44", "2027": "SEK452.11", "2028": "SEK434.44"}]
Present Value of 10-year Cash Flow (PVCF)= SEK4.32b
"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 6.1%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = kr788m × (1 + 0.4%) ÷ (6.1% – 0.4%) = kr14b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= SEKkr14b ÷ ( 1 + 6.1%)10= SEK7.65b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is SEK11.97b. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of SEK113.35. Compared to the current share price of SEK149.8, the company appears potentially overvalued 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. 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 Paradox Interactive 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 6.1%, which is based on a levered beta of 0.957. 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. What is the reason for the share price to differ from the intrinsic value? For Paradox Interactive, I've put together three important factors you should look at:
1. Financial Health: Does PDX 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 PDX'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 PDX? 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 SE 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. |
US STOCKS-Wall Street set to open higher with trade talks in focus
(For a live blog on the U.S. stock market, click or type LIVE/ in a news window.)
* Trade-sensitive Boeing rises in premarket
* Caesars jumps as Eldorado Resorts to buy co
* United Technologies up on Cowen upgrade
* Futures up: Dow 0.26%, S&P 0.23%, Nasdaq 0.31% (Updates prices, adds comments)
By Shreyashi Sanyal
June 24 (Reuters) - Wall Street's main indexes were set to open slightly higher on Monday, with investors pinning their hopes on a meeting between Presidents Donald Trump and Xi Jinping later this week to de-escalate a trade war that is damaging the global economy.
The S&P 500 index hit a record high last week, boosted by rising expectations that the Federal Reserve would cut interest rates and optimism over a revival in trade talks between the United States and China.
"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 in Austin, Texas.
"Don't think markets are expecting a deal, but at least as long as there's dialogue, there's hope for progress."
Shares of trade-sensitive Boeing Co were up 0.3% in premarket trading, while chip companies, which have a major exposure to China, were also trading higher.
Investors were also hopeful that the Federal Reserve was ready to battle growing risks to global and domestic growth from the long-drawn trade conflict, after the U.S. central bank signaled a potential interest rate cut later this year.
At 8:38 a.m. ET, Dow e-minis were up 69 points, or 0.26%. S&P 500 e-minis were up 6.75 points, or 0.23% and Nasdaq 100 e-minis were up 23.75 points, or 0.31%.
However, gains were kept in check by rising tensions between the United States and Iran, after Tehran shot down an American drone last week.
Trump said on Sunday he was not seeking war with Iran after a senior Iranian military commander warned any conflict in the Gulf region could spread uncontrollably and threaten the lives of U.S. troops.
Among other stocks, shares of casino operator Caesars Entertainment Corp jumped 14% after rival Eldorado Resorts Inc said it agreed to buy the company for $8.5 billion. Shares of Eldorado fell 6.8%.
United Technologies Corp gained 1% after Cowen & Co upgraded shares of the building and aerospace supplier to "outperform" from "market perform".
Celgene Corp shares fell 3.3% after Bristol-Myers Squibb Co said its planned $74 billion deal to buy the drugmaker was expected to close at the end of 2019 or beginning 2020, compared with its earlier expectations of closing the deal in the third quarter. Shares of Bristol-Myers dropped 3.2%. (Reporting by Shreyashi Sanyal and Aparajita Saxena in Bengaluru; Editing by Anil D'Silva) |
Amazon to Open 4-star in Dallas to Bolster Retail Presence
Amazon’s AMZN is leaving no stone unturned to expand storefronts across the United States in a bid to strengthen physical presence in the retail space further.The company is now all set to launch Amazon 4-star store in Dallas, TX which is a testament to the aforesaid fact.Notably, the store sells various products like kitchen appliances and other items, home stuffs, toys, books, devices, consumer electronics and games.Further, 4-star store leverages Amazon’s huge customer shopping data from its e-commerce platform to stock four-star or beyond rated products in these stores.The establishment of such store will aid the company enhance offerings and accessibility in the city of Dallas which in turn will help it to boost customer reach in the city.4-star Holds PromiseThe concept of 4-star store is designed to benefit Amazon’s position in both retail and e-commerce market.The store enables shoppers to check the products before buying them. This will enable Amazon to deliver better shopping experience and reach customers who are hesitant to shop online and still prefer to do shopping in the traditional way.All these are likely to strengthen Amazon’s position in the core retail market.Additionally, testing and verification of authenticity of the best rated products from Amazon.com in person will help the company in winning customers’ trust on its online retail platform.This in turn will enable Amazon to attract more customers to online retail platform which will aid its e-commerce dominance.Further, there are digital price tags for each product reflecting its Prime price and marked price. This allows Prime shoppers to pay the online discounted price for purchases made at the store.We note that this strategy is likely to drive the Prime subscriber base which will not only boost Amazon’s offline sales but also online sales, thanks to its customer friendly offers and fast delivery services.
Amazon.com, Inc. Revenue (TTM)
Amazon.com, Inc. revenue-ttm | Amazon.com, Inc. Quote
Expanding Physical StoresThe latest initiative of Amazon strengthens its presence in brick-and-mortar store space. Amazon 4-star was first established at Manhattan's SoHo neighborhood on Spring Street, NY.The company rolled out this store in two more cities – Lone Tree, Colorado, and Berkeley, California. The upcoming one in Dallas will be marked fourth.Apart from 4-star, the company has recently rolled out its second Amazon Go in New York, which is in sync with its intention to take the number of its cashierless stores to a record of 3,000 stores by 2021.Further, the e-commerce giant is reportedly pursuing inauguration of a new chain of grocery stores, with the intention of disrupting the retail space further. The company is planning to spread the new chain across all the major cities of the United States including San Francisco, Seattle, Chicago, Washington D.C. and Philadelphia. Notably, the first one set to open in Los Angeles.We believe its growing number of offline retail stores is likely to sustain Amazon’s momentum in the booming U.S. retail space.Zacks Rank & Stocks to ConsiderCurrently, Amazon carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the broader technology sector worth considering are Rosetta Stone RST, PayPal Holdings, Inc. PYPL and Nuance Communications, Inc. NUAN. While Rosetta Stone sports a Zacks Rank #1 (Strong Buy), PayPal and Nuance Communications carry a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.Long-term earnings growth rate for Rosetta Stone, PayPal and Nuance Communications is pegged at 12.5%, 17.91% and 5%, respectively.More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportAmazon.com, Inc. (AMZN) : Free Stock Analysis ReportPayPal Holdings, Inc. (PYPL) : Free Stock Analysis ReportRosetta Stone (RST) : Free Stock Analysis ReportNuance Communications, Inc. (NUAN) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Should Value Investors Buy AAC Technologies (AACAY) Stock?
While the proven Zacks Rank places an emphasis on earnings estimates and estimate revisions to find strong stocks, we also know that investors tend to develop their own individual strategies. With this in mind, we are always looking at value, growth, and momentum trends to discover great companies.
Of these, perhaps no stock market trend is more popular than value investing, which is a strategy that has proven to be successful in all sorts of market environments. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.
On top of the Zacks Rank, investors can also look at our innovative Style Scores system to find stocks with specific traits. For example, value investors will want to focus on the "Value" category. Stocks with high Zacks Ranks and "A" grades for Value will be some of the highest-quality value stocks on the market today.
One stock to keep an eye on is AAC Technologies (AACAY). AACAY is currently holding a Zacks Rank of #2 (Buy) and a Value grade of A. The stock is trading with a P/E ratio of 13.78, which compares to its industry's average of 21.01. AACAY's Forward P/E has been as high as 19.02 and as low as 7.35, with a median of 12.63, all within the past year.
Investors should also recognize that AACAY has a P/B ratio of 2.43. The P/B ratio is used to compare a stock's market value with its book value, which is defined as total assets minus total liabilities. This company's current P/B looks solid when compared to its industry's average P/B of 3.06. Over the past year, AACAY's P/B has been as high as 6.17 and as low as 2.20, with a median of 2.90.
Value investors will likely look at more than just these metrics, but the above data helps show that AAC Technologies is likely undervalued currently. And when considering the strength of its earnings outlook, AACAY sticks out at as one of the market's strongest value stocks.
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 reportAAC Technologies Holdings Inc. (AACAY) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
WTO says G20 erected 20 new trade barriers, although 29 barriers fell
GENEVA, June 24 (Reuters) - The world's 20 most advanced economies, the G20, erected 20 new trade restrictions between October and May, covering trade worth $335.9 billion, the World Trade Organization said on Monday, warning that several more were being considered.
However, G20 economies also implemented 29 measures to reduce trade barriers during the period, covering $397.2 billion, it said in a regular monitoring report. But new barriers were rising at a far faster rate than the historical average, the WTO said. (Reporting by Tom Miles; editing by Stephanie Nebehay) |
Is Penske Automotive Group, Inc. (NYSE:PAG) Potentially Undervalued?
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Penske Automotive Group, Inc. (NYSE:PAG), which is in the specialty retail business, and is based in United States, saw a decent share price growth in the teens level on the NYSE over the last few months. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s take a look at Penske Automotive Group’s outlook and value based on the most recent financial data to see if the opportunity still exists.
View our latest analysis for Penske Automotive Group
Good news, investors! Penske Automotive Group is still a bargain right now. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Penske Automotive Group’s ratio of 8.64x is below its peer average of 14.94x, which suggests the stock is undervalued compared to the Specialty Retail industry. Although, there may be another chance to buy again in the future. This is because Penske Automotive Group’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. 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 Penske Automotive Group, it is expected to deliver a relatively unexciting earnings growth of 0.05%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for Penske Automotive Group, at least in the near term.
Are you a shareholder?Even though growth is relatively muted, since PAG is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation.
Are you a potential investor?If you’ve been keeping an eye on PAG for a while, now might be the time to make a leap. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy PAG. But before you make any investment decisions, consider other factors such as the strength of its balance sheet, in order to make a well-informed investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Penske Automotive Group. You can find everything you need to know about Penske Automotive Group inthe latest infographic research report. If you are no longer interested in Penske Automotive Group, you can use our free platform to see my list of over50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
2 Infants, a Toddler and a Woman Found Dead Near Border in Texas
(MISSION, Texas) — Four people, including three children, found dead in South Texas near the border with Mexico likely died of dehydration and heat exposure after crossing the Rio Grande into the U.S., authorities said Monday. A law enforcement official close to the investigation told The Associated Press the four were overcome by the heat and foul play is not suspected. The official spoke on condition of anonymity because the person isn’t authorized to speak publicly about the bodies found Sunday. Hidalgo County sheriff’s Sgt. Frank Medrano said earlier that the bodies of a woman in her early 20s, a toddler and two infants were found in or near Anzalduas Park, which borders the river in the city of Mission. Authorities believe they may have been dead for days before being discovered. The FBI is leading the investigation into the deaths because the park is on federal land. “It’s an incredibly heart-breaking situation,” the agency said in a statement Monday. The names of the four have not been released and authorities are working to determine their country of origin. Medrano said the area is commonly used by migrants entering the country illegally. “It’s a well-known route because it’s so close to the border,” he said. Constable Larry Gallardo told The Monitor newspaper in McAllen that the terrain can be difficult to traverse. “There’s a lot of brush,” he said. “It’s like ranchland, there’s no difference.” The Rio Grande Valley sector of the Border Patrol, which includes the area where the four bodies were found Sunday, has experienced an unprecedented number of apprehensions involving people entering the country illegally. Over a seven-month period ending in April, Border Patrol agents had apprehended more than 164,000 people, a number surpassing the total number of apprehensions in all of fiscal year 2018. |
When Should You Buy Penske Automotive Group, Inc. (NYSE:PAG)?
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Penske Automotive Group, Inc. (NYSE:PAG), which is in the specialty retail business, and is based in United States, saw a double-digit share price rise of over 10% in the past couple of months on the NYSE. As a mid-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Today I will analyse the most recent data on Penske Automotive Group’s outlook and valuation to see if the opportunity still exists.
Check out our latest analysis for Penske Automotive Group
Good news, investors! Penske Automotive Group is still a bargain right now. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Penske Automotive Group’s ratio of 8.64x is below its peer average of 14.94x, which suggests the stock is undervalued compared to the Specialty Retail industry. What’s more interesting is that, Penske Automotive Group’s share price is quite volatile, which gives us more chances to buy since the share price could sink lower (or rise higher) in the future. This is based on its high beta, which is a good indicator for how much the stock moves relative to the rest of the market.
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 relatively muted profit growth of 0.05% expected over the next year, growth doesn’t seem like a key driver for a buy decision for Penske Automotive Group, at least in the short term.
Are you a shareholder?Even though growth is relatively muted, since PAG is currently undervalued, it may be a great time to increase your holdings in the stock. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor?If you’ve been keeping an eye on PAG for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy PAG. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Penske Automotive Group. You can find everything you need to know about Penske Automotive Group inthe latest infographic research report. If you are no longer interested in Penske Automotive Group, you can use our free platform to see my list of over50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Duke and Duchess of Cambridge named ‘most socially significant’ people by Tatler
The Duke and Duchess of Cambridge have topped Tatler ’s Social Power List, earning them the title of Britain's "most socially signifiant" people. The society bible’s inaugural index ranks public figures based on their “social significance”, as judged by the publication’s editorial team. The magazine describes an invitation to stay at William and Kate's Norfolk home, Anmer Hall, as the “ultimate social trophy” and ranks them one place ahead of actor Idris Elba and his wife, Sabrina Dhowre. In third place are financier Joseph Getty and wife Sabine Getty, who is a jewellery designer. The high-flying couples are followed by seven-year-old Harper Beckham, who, the magazine notes, “jets between LA and London and the Cotswolds” and celebrated her sixth birthday at Buckingham Palace. Other famous faces in Tatler ’s prestigious top 10 include former England footballer Jamie Redknapp and Little Mix’s Perrie Edwards and her boyfriend, footballer Alex Oxlade-Chamberlain – the magazine describes the duo as “the new social power couple everyone wants a piece of”. The publication includes several other names in its index outside of the top 10, though these are names are not ranked. They include fashion designer Erdem Moralioglu, comedian Jack Whitehall and Lady Amelia Windsor. Stella McCartney, Dame Joan Collins and Kate Moss are also listed, as is Sir Mick Jagger and the entire Delevingne family. The Duke and Duchess of Sussex also feature in the index, though they are not in the top 10. Tatler ’s index comes days after The Royal Foundation confirmed that Prince Harry and Meghan Markle would split from the charity they ran with Prince William and Kate Middleton to form their own organisation. (Tatler) The Social Power Index appears in the August issue of Tatler , which is available on newsstands from Thursday 27 June. |
Why is Urban Outfitters (URBN) Struggling on the Bourses?
Shares ofUrban Outfitters, Inc.URBN are currently trading close to its 52-week low of $22.19, and have plunged roughly 15.9% in the past three months. The stock came under pressure following the company’s first-quarter fiscal 2020 results on May 21. Since then shares of this lifestyle retailer have fallen about 13%.
Further, a decline in the Zacks Consensus Estimate indicates that analysts are not very optimistic about the stock’s performance going forward. We note that the Zacks Consensus Estimate for the ongoing quarter and fiscal 2020 has decreased 21 cents and 17 cents to 60 cents and $2.43, respectively, in the past 60 days.
Let’s Introspect
Shares of Urban Outfitters have lagged the industry in the past six months. In the said period, shares of this Philadelphia, PA-based company have plunged approximately 25.9% compared with the industry’s decline of 8%. Even better-than-expected first-quarter fiscal 2020 results failed to provide any impetus to this Zacks Rank #3 (Hold) stock.
While net sales showed a marginal improvement of 1%, earnings fell sharply by 18.4% from the year-ago period. Further, gross margin shrunk year over year and rate of growth of Retail segment comps decelerated sequentially. Further, the company has been grappling with soft store traffic. These factors along with management’s remark that the company commenced second-quarter below first-quarter trend hurt investor sentiment.
Comparable Retail segment net sales jumped 1%, following an increase of 3% in the preceding quarter. Management anticipates second-quarter retail segment comps to decline in low-single-digit range.
Based on the comps projection, gross margin is likely to contract more than 300 bps in the second quarter. This can be attributed to increased markdown rates and deleverage in delivery, logistics and store occupancy expenses. During the first quarter, gross margin contracted 167 bps to approximately 31.1%, primarily due to lower gross profit in the Retail segment.
Strategic Endeavors on Track
While aforementioned factors raise concern, Urban Outfitters remains committed to sustain investments in direct-to-consumer business, enhance productivity in existing channels, add new brands and optimize inventory level. Being a multi-brand and multi-channel retailer, the company offers flexible merchandising strategy. The company also has a significant domestic and international presence with rapidly expanding e-commerce activities.
The company also introduced a subscription rental service for women’s clothes called Nuuly. It envisions roughly 50,000 subscribers within one year of operation. The subscribers will have to shell out $88 each month for one six-item box. Shoppers can choose from Anthropologie, Free People and Urban Outfitters brands, third-party brand and designer labels, and rare vintage items for rent via a custom-built, digital platform.
We hope that these endeavors help lift the company’s performance and bring the stock back on track.
3 Picks You Cant’s Miss
Children's Place PLCE has a long-term earnings growth rate of 8% and a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
Genesco GCO, with long-term earnings per share growth rate of 5%, carries a Zacks Rank #1.
Stitch Fix SFIX with a Zacks Rank #2 (Buy), has long-term earnings per share growth rate of 22.5%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
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 reportUrban Outfitters, Inc. (URBN) : Free Stock Analysis ReportChildren's Place, Inc. (The) (PLCE) : Free Stock Analysis ReportGenesco Inc. (GCO) : Free Stock Analysis ReportStitch Fix, Inc. (SFIX) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Does Otter Tail Corporation's (NASDAQ:OTTR) Debt Level Pose A Problem?
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Stocks with market capitalization between $2B and $10B, such as Otter Tail Corporation (NASDAQ:OTTR) with a size of US$2.1b, 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 the two other categories of stocks. Today we will look at OTTR’s financial liquidity and debt levels, which are strong indicators for whether the company can weather economic downturns or fund strategic acquisitions for future growth. Don’t forget that this is a general and concentrated examination of Otter Tail’s financial health, so you should conduct further analysisinto OTTR here.
View our latest analysis for Otter Tail
OTTR has built up its total debt levels in the last twelve months, from US$620m to US$655m – this includes long-term debt. With this growth in debt, OTTR's cash and short-term investments stands at US$891k , ready to be used for running the business. On top of this, OTTR has generated US$156m in operating cash flow during the same period of time, leading to an operating cash to total debt ratio of 24%, indicating that OTTR’s debt is appropriately covered by operating cash.
Looking at OTTR’s US$201m in current liabilities, it appears that the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.36x. The current ratio is calculated by dividing current assets by current liabilities. Usually, for Electric Utilities companies, this is a suitable ratio since there's a sufficient cash cushion without leaving too much capital idle or in low-earning investments.
With debt reaching 86% of equity, OTTR may be thought of as relatively highly levered. This is not uncommon for a mid-cap company given that debt tends to be lower-cost and at times, more accessible. We can check to see whether OTTR is able to meet its debt obligations by looking at the net interest coverage ratio. A company generating earnings before interest and tax (EBIT) at least three times its net interest payments is considered financially sound. In OTTR's, case, the ratio of 4.09x 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 OTTR’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. Keep in mind I haven't considered other factors such as how OTTR has been performing in the past. I recommend you continue to research Otter Tail to get a more holistic view of the mid-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for OTTR’s future growth? Take a look at ourfree research report of analyst consensusfor OTTR’s outlook.
2. Valuation: What is OTTR 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 OTTR 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. |
Lizzo’s Performance at the 2019 BET Awards Was So Good Even Rihanna Gave It a Standing Ovation
Lizzo continued her domination of summer 2019 with an incredible performance of her song "Truth Hurts" at the BET Awards Sunday night, where she appeared atop a wedding cake in a veil, bridal lingerie, and a killer pair of sunglasses, and twerked while playing the flute. This comes on the heels of her MTV Movie & TV Awards performance of "Juice," which featured a tribute to the movie Sister Act. Basically, Lizzo is giving us all the viral performance clips we need and even Rihanna—and her new red hair —could not deny her excellence last night, giving her a standing ovation. Could anything feel better than a RiRi standing O? We're guessing not. Watch the performance for yourself below: https://twitter.com/BET/status/1142977140205342721 Now you know why Rihanna loved it—and the Internet went nuts for the moment. "Had to make a GIF of Rihanna applauding Lizzo, I now release the GIF into the wild, for the benefit of the human race," one person tweeted. https://twitter.com/jamesmoran/status/1143084917150101507 https://twitter.com/Aries80sBaby124/status/1143132664733601792 https://twitter.com/ReenNahMean/status/1143105685531561991 https://twitter.com/BoyDelRey13/status/1143102863230586880 https://twitter.com/keamofo/status/1143056536987742208 https://twitter.com/ffscxtherine/status/1143074227655868417 https://twitter.com/nicole_perez1/status/1142959703749726211 Lizzo herself tweeted an image of Rihanna clapping and wrote, "That’s it... that’s the tweet 🤷🏾♀️." https://twitter.com/lizzo/status/1143024946928447488 But praise from Rihanna aside, Lizzo's motivation for the performance was much deeper. "There’s nothing I’d rather see than black girls falling in love with themselves on T.V.," she tweeted. "Big girls—you are IT! YOU ARE ALWAYS the bride in a marriage of SELF-LOVE!" Story continues https://twitter.com/lizzo/status/1143010890884665345 The social media reactions from fans watching on television was incredibly positive. "Ok @lizzo you did that shit!! When you pull that flute bitch I jump out my chair!!!" Saturday Night Live 's Leslie Jones tweeted. "MY GIRL @LIZZO WILL GIVE YOU A PRODUCTION! THE ENERGY! THE NARRATIVE! THE COSTUMES! THE THIGHS! THE BUNDLES! THE DAGGONE FLUTE PLAYING WHILE TWERKING!" another Twitter user wrote. "@RIHANNA knows what it is everyone should be standing. The category issssss 100% THAT BISH!" https://twitter.com/Lesdoggg/status/1143050692401090560 https://twitter.com/RdotSpoon/status/1143004784288419841 https://twitter.com/dawson_riah/status/1143011890882207745 https://twitter.com/KennieJD/status/1143066614104899584 https://twitter.com/SylviaObell/status/1142960003331919872 https://twitter.com/ItsKweenKay_/status/1142961390224838656 https://twitter.com/_ellenisdead/status/1142969394877861888 https://twitter.com/blkgirlculture/status/1142959531506487296 https://twitter.com/casspernyovest/status/1142981465459843072 Do you think it's too much to ask for a Lizzo and Rihanna collaboration—perhaps for RiRi's new album ? Originally Appeared on Glamour View comments |
Boxwood Continues to Expand its Team of Seasoned M&A Professionals
Dan Martinson Joins Boxwood Partners, LLC
RICHMOND, VA / ACCESSWIRE / June 24, 2019 /Boxwood Partners, a mid-market investment banking firm based in Richmond, VA, is pleased to announce the hiring of Dan Martinson as the company's newest Analyst.
"We are very excited to welcome Dan Martinson to the Boxwood team, after Deloitte in Richmond," said Patrick Galleher, Managing Partner.
Prior to joining Boxwood full time, Dan was an Audit Senior in the Audit and Assurance Practice at Deloitte, where he performed audit and advisory services to clients in the consumer product, foodservice distribution, staffing, and healthcare industries. Dan earned his B.S.B.A in Accounting from the E. Claiborne Robins School of Business at the University of Richmond in 2016. While at Richmond, Dan was a pitcher for the Spider baseball team. Dan is also a licensed Certified Public Accountant in the State of Virginia.
"I am excited to be working alongside Patrick, Brian and the Boxwood team after three successful years in Audit at Deloitte. They have built up the firm with an impressive track record providing top-tier middle-market Mergers and Acquisitions advisory to a number of impressive clients."
Boxwood Partners' most recent hire comes as Boxwood continues to expand its list of high profile engagements with leading middle market clients. "Dan will play a key role in continuing to expand our firm as we focus on providing top service to our clients throughout the transaction process. Our success thus far has provided us with the opportunity to make key additions like Dan with outstanding prior experience. We look forward to the key contributions he will bring to our firm as our client base continues to grow," said Patrick Galleher, Managing Partner.
About Boxwood Partners, LLC:
Boxwood Partners (www.boxwoodpartnersllc.com), is a mid-market investment banking firm based in Richmond, VA. Boxwood Partners combines a unique blend of senior-level transaction advisory, business operating experience, and proven process execution skills to give our clients a distinct advantage in the market. The firm's extensive relationships within the global capital and buyer communities (including U.S. and international private equity groups, corporations, hedge funds and lenders) and other important transaction-related service providers such as consultants, attorneys, and accountants ensure that the firm's clients receive the attention and service they deserve.
SOURCE:Boxwood Partners LLC
View source version on accesswire.com:https://www.accesswire.com/549648/Boxwood-Continues-to-Expand-its-Team-of-Seasoned-MA-Professionals |
Social Life Network Intends to Acquire LikeRE.com from Real Estate Social Network, Inc.
DENVER, CO / ACCESSWIRE / June 24, 2019 /Social Life Network, Inc. (OTCQB:WDLF), an online technology company with social network platforms and e-commerce applications in many niche industries, has entered into a Letter of Intent (LOI) to acquire Colorado-based real estate social network, LikeRE.com.
Through the acquisition, Social Life will expand its digital products and applications for real estate professionals. "Our plan is to go head-to-head with platforms like SLACK, but specifically focusing on real estate," said Ken Tapp, Chief Executive Officer of Social Life Network. "We are also excited about the opportunity to provide LikeRE with step up technology and resources needed to expand its revenue streams worldwide while enhancing our own shareholders value."
Social Life Network began licensing part of its technology platform to the Real Estate Social Network, Inc. in 2016, then a tech start-up, in an effort to help them incubate theLikeRE.comsocial network into a competitive force.
Britt Glassburn, Chief Executive Officer of Real EstateSocial Network, Inc., said, "When we set out as a tech start-up three years ago, we knew that providing a better platform for real estate professionals to communicate with one another and their customers was going to be a key part of our business model, but now it has evolved into so much more. With the ability to create private and public communication channels, groups and business pages, LikeRE now resembles and leapfrogs SLACK in adding value to the real estate industry".
Upon completion of the transaction, LikeRE.com will become a wholly-owned subsidiary of Social Life Network, with the goal to create synergistic value by further expanding its social network and mobile application technology.
About LikeRE.com, Inc.®
LikeRE.com is a website and mobile app social network that connects real estate agents, home builders, title companies, loan officers, interior designers, home improvement professionals, buyers and sellers together in one real estate centric online community.
To sign up on the LikeRE Social Network, visithttps://www.likere.com
About Social Life Network, Inc.
Social Life Network, Inc. is an artificial intelligence and blockchain powered social network and e-commerce technology company based in Denver Colorado. The social network platform meets the growing demand for niche social networking in many global industries, including the residential real estate, cannabis, racket sports, soccer, hunting and fishing. These niche industries represent 100's of millions of online users worldwide.
For more information, visithttps://www.SocialNetwork.ai/
Disclaimer
This news release may include forward-looking statements within the meaning of Section 27A of the United States Securities Act of 1933, as amended, and Section 21E of the United States Securities and Exchange Act of 1934, as amended, with respect to achieving corporate objectives, developing additional project interests, the Company's analysis of opportunities in the acquisition and development of various project interests and certain other matters. No information in this press release should be construed as any indication whatsoever of the Company's future revenues, results of operations or stock price. These statements are made under the "Safe Harbor" provisions of the United States Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties which could cause actual results to differ materially from those in the forward-looking statements contained herein.
Contact:
Investor RelationsIR@Social-Life-Network.com855-933-3277
SOURCE:Social Life Network, Inc
View source version on accesswire.com:https://www.accesswire.com/549636/Social-Life-Network-Intends-to-Acquire-LikeREcom-from-Real-Estate-Social-Network-Inc |
Stocks Rise for Third Straight Week
A late-session selloff kept the S&P from another record and snapped the major indices’ four-day winning streak.But let’s not be too demanding, especially in a low volume summer session. Stocks still rose for the third consecutive week to continue a spectacular month of June.Any advance for the S&P would have given the index another record on Friday, but it just couldn’t hold onto its gains. It slipped 0.13% to 2950.46 after closing at a new high yesterday for the first time since April 30.The Dow momentarily eclipsed its closing high from October 3, but ultimately slipped by 0.13% (or about 34 points) to 26,719.13.The NASDAQ saw the steepest decline on a percentage basis with a slip of 0.24% (or nearly 20 points) to 8031.71.However, the tech-heavy index had the best weekly advance of 3%, while the Dow and S&P rose 2.4% and 2.2%, respectively.This week was all about the Fed… as this year has been as well. The rally of 2019 started when the Committee made a sudden dovish turn in January, and continued on Wednesday when they left the door open for rate cuts in July and beyond.And you can bet the market is certainly expecting those cuts in the coming months!We also enjoyed some good news on the trade front this week when it was announced that President Trump and China President Xi would be meeting at the G-20 in Japan.This summit will likely be the main event next week as the market hopes for some progress in the trade conflict after a long stalemate.We’re not looking for a miraculous resolution that comes out of nowhere… just some forward progress that could give this month a strong finish and instill some positive sentiment moving forward.Is that too much to ask?Today's Portfolio Highlights:Large-Cap Trader:The portfolio put more of its ‘set-aside’ cash to work on Friday with a 5% allocation in large-cap credit card company Mastercard (MA). It has an impressive history of beating the Zacks Consensus Estimate, stretching back to 2015. Most of the 19 covering analysts have raised their estimates for the next quarter. None have lowered. John also likes MA’s solid market position, expanding digital initiatives and the shift toward electronic payments, which all have the company poised for growth. Its numerous acquisitions haven’t hurt either. Read the editor’s full analysis of this new buy in the complete commentary.Home Run Investor:Good earnings growth on a year-over-year basis and estimates that are trickling higher. That’s what Brian loves to see when searching for a new pick… and that’s exactly what he’s seeing with Simulations Plus (SLP). This Zacks Rank #2 (Buy) is a small-cap software play. More specifically, it develops drug discovery and development simulation software that help drug and biotech companies conduct their research. SLP has beaten the Zacks Consensus Estimate in three of the last four quarters. If operating margins continue to grow, the editor thinks this stock will really run. Read the complete commentary for more on this new addition.Surprise Trader:Here’s to Constellation Brands (STZ)! Dave bought this alcohol beverage company today ahead of its next quarterly report on Friday, June 28, before the bell. This Zacks Rank #2 (Buy) has beaten earnings expectations for three straight quarters and has been known to swing wildly after a report. STZ seems poised for another positive surprise next week with an Earnings ESP of 3.2%. See the complete commentary for more on this new addition.Stocks Under $10:After getting beaten up in May, The Rubicon Project (RUBI) has been in recovery mode throughout June. Brian likes the progress that the company has made and thinks it can continue, so he added RUBI on Friday. This Zacks Rank #1 (Strong Buy) is a global technology company that’s focused on automating the buying and selling of advertising. It has beaten the Zacks Consensus Estimate for four straight quarters now with an average surprise of nearly 64% in that time. The last beat was over 26%. Read the full write-up for more.Options Trader:Two bull call spreads expired today and brought the maximum profit possible to the portfolio. The Cree (CREE) June 48/55 spreads closed fully in the money and banked a gain of 144%. Lennox (LII) was in the same situation as the June 230/240 calls led to a profit of 111%. The Burlington (BURL) spreads also expired today for a small loss. See the full commentary for more on today’s big returns.Technology Innovators:The software space seems to have Brian’s attention. He bought in all three of his services on Friday… and all of them were in software. The pick for this portfolio was OptimizeRX (OPRX), which provides consumer and physician platforms to help patients better afford and comply with their medicines and healthcare products. This Zacks Rank #1 (Strong Buy) has rising earnings estimates (of course), a good history of beating the Zacks Consensus Estimate and a great-looking chart. The complete commentary has more on this new buy.Have a Great Weekend!Jim Giaquinto
Recommendations from Zacks' Private Portfolios:Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy).Click here to "test drive" Zacks Ultimate for FREE >>Zacks Investment Research |
Are You Looking for a High-Growth Dividend Stock? Kforce (KFRC) Could Be a Great Choice
All investors love getting big returns from their portfolio, whether it's through stocks, bonds, ETFs, or other types of securities. However, when you're an income investor, your primary focus is generating consistent cash flow from each of your liquid investments.
Cash flow can come from bond interest, interest from other types of investments, and of course, dividends. A dividend is that coveted distribution of a company's earnings paid out to shareholders, and investors often view it by its dividend yield, a metric that measures the dividend as a percent of the current stock price. Many academic studies show that dividends account for significant portions of long-term returns, with dividend contributions exceeding one-third of total returns in many cases.
Kforce in Focus
Based in Tampa, Kforce (KFRC) is in the Business Services sector, and so far this year, shares have seen a price change of 13.03%. The staffing company is currently shelling out a dividend of $0.18 per share, with a dividend yield of 2.06%. This compares to the Staffing Firms industry's yield of 1.23% and the S&P 500's yield of 1.91%.
Taking a look at the company's dividend growth, its current annualized dividend of $0.72 is up 20% from last year. Kforce has increased its dividend 3 times on a year-over-year basis over the last 5 years for an average annual increase of 10.38%. Any future dividend growth will depend on both earnings growth and the company's payout ratio; a payout ratio is the proportion of a firm's annual earnings per share that it pays out as a dividend. Kforce's current payout ratio is 31%, meaning it paid out 31% of its trailing 12-month EPS as dividend.
KFRC is expecting earnings to expand this fiscal year as well. The Zacks Consensus Estimate for 2019 is $2.38 per share, representing a year-over-year earnings growth rate of 3.48%.
Bottom Line
From greatly improving stock investing profits and reducing overall portfolio risk to providing tax advantages, investors like dividends for a variety of different reasons. But, not every company offers a quarterly payout.
For instance, it's a rare occurrence when a tech start-up or big growth business offers their shareholders a dividend. It's more common to see larger companies with more established profits give out dividends. Income investors must be conscious of the fact that high-yielding stocks tend to struggle during periods of rising interest rates. With that in mind, KFRC is a compelling investment opportunity. Not only is it a strong dividend play, but the stock currently sits at a Zacks Rank of 3 (Hold).
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 reportKforce, Inc. (KFRC) : Free Stock Analysis ReportTo read this article on Zacks.com click here. |
The Hartford (HIG) Hits Fresh High: Is There Still Room to Run?
Have you been paying attention to shares of The Hartford Financial Services Group (HIG)? Shares have been on the move with the stock up 4.5% over the past month. The stock hit a new 52-week high of $55.8 in the previous session. The Hartford Financial Services Group has gained 25.3% since the start of the year compared to the 11.6% move for the Zacks Finance sector and the 14.3% return for the Zacks Insurance - Multi line industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on May 1, 2019, The Hartford reported EPS of $1.39 versus consensus estimate of $1.24.
For the current fiscal year, The Hartford is expected to post earnings of $5.08 per share on $20.22 billion in revenues. This represents a 17.32% change in EPS on a 6.04% change in revenues. For the next fiscal year, the company is expected to earn $5.45 per share on $21.49 billion in revenues. This represents a year-over-year change of 7.28% and 6.28%, respectively.
Valuation Metrics
The Hartford may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
The Hartford has a Value Score of A. The stock's Growth and Momentum Scores are B and D, respectively, giving the company a VGM Score of A.
In terms of its value breakdown, the stock currently trades at 11X current fiscal year EPS estimates. On a trailing cash flow basis, the stock currently trades at 9.6X versus its peer group's average of 9.9X. Additionally, the stock has a PEG ratio of 1.15. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, The Hartford currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if The Hartford meets the list of requirements. Thus, it seems as though The Hartford shares could still be poised for more gains ahead.
How Does The Hartford Stack Up to the Competition?
Shares of The Hartford have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? Some of its industry peers are also looking good, including American International Group (AIG), Kemper (KMPR), and Cigna (CI), all of which currently have a Zacks Rank of at least #2 and a VGM Score of at least B, making them well-rounded choices.
The Zacks Industry Rank is in the top 8% of all the industries we have in our universe, so it looks like there are some nice tailwinds for The Hartford, even beyond its own solid fundamental situation.
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 reportThe Hartford Financial Services Group, Inc. (HIG) : Free Stock Analysis ReportCigna Corporation (CI) : Free Stock Analysis ReportKemper Corporation (KMPR) : Free Stock Analysis ReportAmerican International Group, Inc. (AIG) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
What Should You Know About National Beverage Corp.'s (NASDAQ:FIZZ) Future?
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Since National Beverage Corp. (NASDAQ:FIZZ) released its earnings in January 2019, analyst consensus outlook seem bearish, with profits predicted to drop by 1.7% next year relative to the past 5-year average growth rate of 31%. Presently, with latest-twelve-month earnings at US$150m, we should see this fall to US$147m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company shouldresearch its fundamentals here.
See our latest analysis for National Beverage
The longer term expectations from the 4 analysts of FIZZ is tilted towards the negative sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. To understand the overall trajectory of FIZZ's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
This results in an annual growth rate of -13% based on the most recent earnings level of US$150m to the final forecast of US$102m by 2022. EPS reaches $2.28 in the final year of forecast compared to the current $3.21 EPS today. The primary reason for earnings contraction is due to a falling top-line, with negative growth of -2.3%. Furthermore, the current 15% margin is expected to contract to 11% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For National Beverage, there are three fundamental aspects you should further examine:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is National Beverage 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 National Beverage is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of National Beverage? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Death toll in Indian encephalitis outbreak rises to 152
PATNA, India (AP) — India's Supreme Court on Monday directed state and national authorities to file reports to the court on an encephalitis outbreak in the eastern state of Bihar this month in which 152 children have died. A senior health department official in Bihar, Sanjay Kumar, said the epidemic is showing signs of slowing with no new deaths on Monday. The fatalities have occurred in 20 of the state's 38 districts. The outbreak has been exacerbated by a heatwave, with temperatures in Patna, Bihar's capital, reaching a high of 45.8 Celsius (114.5 Fahrenheit). "We're hoping with the onset of the monsoon, the epidemic will ease further," Kumar said. More than 700 cases of encephalitis have been registered since the outbreak began June 1, officials said. Young children are particularly vulnerable to the illness, which can cause swelling of the brain, fever and vomiting. The Supreme Court was responding to a petition filed by a lawyer. "The deaths of children are a direct result of negligence and inaction" on part of authorities, said Manohar Pratap, the petitioner. The court expressed concern over the deaths and asked the governments to respond within seven days with details on medical facilities, nutrition, sanitation and hygiene conditions in the state. Thousands of Indians suffer from encephalitis, malaria, typhoid and other mosquito-borne diseases each year during the summer monsoon season. India's central government has sent medical experts to Bihar to help doctors treat the patients. The Bihar authorities have been sharply criticized because patients were sharing beds in crowded hospital wards with too few doctors. The families who could afford it transferred their children to private hospitals in Patna and other larger cities. The Press Trust of India news agency on Monday reported that about 6,000 deaths from encephalitis occurred in India between 2008 and 2014. |
5 Cybersecurity Stocks to Buy on Simmering US-Iran Tensions
On Jun 21, news emerged that a day earlier the United States Cyber Command had carried out online attacks on Iranian targets. The operation, first revealed by a report from Yahoo News, was carried out on the same when President Trump decided not to go ahead with military strikes against Iran. The attacks were retaliation for Iran’s destruction of an American surveillance drone.
The choice of cyberwarfare as low level response opens up a whole new world of possibilities. Iran’s ability to retaliate in kind has improved radically over the last decade. This would only boost the demand for cybersecurity solutions among U.S. companies of all sizes. Investing in these stocks from this sector would make for a smart choice now.
Cyberattacks Replace Military Strikes on Iran
On Jun 21, President Trump said that he had called off the military attack on Iran 10 minutes before the strike because he thought that it would be a disproportionate response. Trump said on Jun 22 that he was “getting a lot of praise” for averting an attack, which would have caused multiple deaths.
Instead, the United States decided to press ahead with online attacks, planned carefully over the past few weeks. They were a response to both the downing of the American drone as well as the tanker attacks that took place earlier this month.
A number of systems were targeted, including an Iranian intelligence group, which apparently helped in planning the attacks on tankers in the Strait of Hormuz. Other targets include computer systems, which control the launch stages of Iranian missiles.
Retaliation Likely, Cybersecurity Stocks to Gain
Investors should keep in mind that the threat of Iranian retaliation to these cyberattacks is both real and credible. Iran’s capability in this area has improved considerably over the last decade as borne out by the attacks on American banks in 2012 and 2013. In fact, Iran’s cyber forces has had years of experience in attacking U.S. targets, including the attack on a Las Vegas Casino in 2015.
It comes as no surprise then that cybersecurity stocks will gain in an environment already brimming with online threats. The Prime Cyber Security ETF (HACK) is already up 17.9% year to date, evidence of the field’s growing importance in corporate America. As cyberattacks grow, spending on cybersecurity will only increase.
Another reason for changing security priorities is the growing popularity of cloud computing. As more and more companies embrace this trend, legacy security solutions such as antiviruses and firewalls are losing market share to cloud-based options such as Web security gateways. This is likely to spark off a new trend of spending on fresh cybersecurity options.
Our Choices
The American attack on Iranian computer systems is perhaps the first shot fired into cyberspace in the ongoing conflict between the two countries. Likely retaliation will further boost spending on cybersecurity by U.S. companies. Cloud-based options will gain the most from this trend as they seem to represent the future.
Investing in cybersecurity stocks looks prudent. We have narrowed our search to the following stocks based on a good Zacks Rank and other relevant metrics.
Qualys, Inc.QLYS is a provider of cloud security and compliance solutions that enable organizations to identify security risks to their information technology infrastructure, and help protect their IT systems and applications from cyberattacks.
Qualys’s expected earnings growth for the current year is 10.3%. The Zacks Consensus Estimate for current-year earnings has improved 3.2% over the past 60 days. It sports a Zacks Rank #1. You can seethe complete list of today’s Zacks #1 Rank stocks here.
Cisco SystemsCSCO is benefiting from its expanding footprint in the rapidly growing security market. In fact, its comeback story has been largely fueled by strong contributions from security, Infrastructure Platforms and applications.
Cisco has a Zacks Rank #2 (Buy). The company’s expected earnings growth for the current year is 18.4%. The Zacks Consensus Estimate for current-year earnings has moved north by 0.7% over the past 60 days.
Fortinet Inc.FTNT is a provider of network security appliances and Unified Threat Management (UTM) network security solutions to enterprises, service providers and government entities worldwide.
Fortinet has a Zacks Rank #2. The company has expected earnings growth of 15.9% for the current year. The Zacks Consensus Estimate for current-year earnings has improved by 2.4% over the past 60 days.
Radware Ltd.RDWR is a developer, manufacturer and marketer of cyber security and application delivery solutions.
Radware has a Zacks Rank #2. The company has expected earnings growth of 21.8% for the current year. The Zacks Consensus Estimate for current-year earnings has moved 5.8% north over the past 30 days.
Zscaler, Inc.ZS is a cloud security company with global operations.
Zscaler has a Zacks Rank #2. The company’s expected earnings growth for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has moved 36.6% north over the past 30 days.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
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 reportCisco Systems, Inc. (CSCO) : Free Stock Analysis ReportFortinet, Inc. (FTNT) : Free Stock Analysis ReportRadware Ltd. (RDWR) : Free Stock Analysis ReportQualys, Inc. (QLYS) : Free Stock Analysis ReportZscaler, Inc. (ZS) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
A Closer Look At National Beverage Corp.'s (NASDAQ:FIZZ) Impressive ROE
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Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). By way of learning-by-doing, we'll look at ROE to gain a better understanding of National Beverage Corp. (NASDAQ:FIZZ).
National Beverage has a ROE of 49%, based on the last twelve months. That means that for every $1 worth of shareholders' equity, it generated $0.49 in profit.
View our latest analysis for National Beverage
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for National Beverage:
49% = US$151m ÷ US$305m (Based on the trailing twelve months to January 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all the money paid into the company from shareholders, plus any earnings retained. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means ROE can be used to compare two businesses.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As you can see in the graphic below, National Beverage has a higher ROE than the average (20%) in the Beverage industry.
That's what I like to see. I usually take a closer look when a company has a better ROE than industry peers. One data point to check is ifinsiders have bought shares recently.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
National Beverage is free of net debt, which is a positive for shareholders. Its high ROE already points to a high quality business, but the lack of debt is a cherry on top. After all, when a company has a strong balance sheet, it can often find ways to invest in growth, even if it takes some time.
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 ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
But note:National Beverage may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Danny Boyle confirms 28 Days Later sequel: “Alex Garland and I have a wonderful idea”
Danny Boyle wants to get infected again. In a new interview with The Independent , the Oscar-winning filmmaker confirmed he’s working on a 28 Days Later sequel with original screenwriter Alex Garland . “Alex Garland and I have a wonderful idea for the third part. It’s properly good,” he explained. “The original film led to a bit of a resurgence in the zombie drama and it doesn’t reference any of that. It doesn’t feel stale at all. [Alex] is concentrating on directing his own work at the moment, so it’s stood in abeyance really, but it’s a you-never-know.” Garland, who’s coming off last year’s incredible Annihilation , last spoke of the project in 2015 . At the time, he echoed Boyle’s sentiments, claiming it’s a “simple” and “weird” idea that just “popped” in his head while discussing Trainspotting 2 . (Ranking: Every Danny Boyle Movie from Worst to Best ) However, he also stressed that he didn’t want to work on it. “I don’t really want to play a role, and [producer] Andrew [McDonald] said, ‘Leave it to me.’ So he’s gone off and is working on it.” Perhaps he’s had a change of heart? Or the script is done? It’s exciting news. While the zombie genre is about 12 feet under at this point, 28 Days Later has always been more about the collapse of society and the corruption of power anyhow. Odds are Garland and Boyle found another theme to chew on. Even so, Juan Carlos Fresnadillo’s 2007 sequel, 28 Weeks Later , was an incredible addition that helped aide Jeremy Renner’s Rennersaince and gave us Imogen Poots. So, a third chapter is welcome regardless, but especially if Boyle returns. For now, he’s in Beatlemania with his forthcoming musical comedy Yesterday , which hits theaters on June 28th. //imasdk.googleapis.com/js/sdkloader/ima3.js //plugins.consequencemedia.com/comscore/comScore-JS-6.3.1.181004.min.js //plugins.consequencemedia.com/wasp-video-player/wasp.videoplayer.min.js waspVideoPlayer({ bidUnit: { code: 'video1', mediaTypes: { video: { playerSize: [640, 480], context: 'instream', mimes: ['video/mp4'] } }, bids: [{ bidder: 'appnexus', params: { placementId: 14369254, //placementId: 13232361, video: { skippable: true, playback_method: ['auto_play_sound_off'] } } }] }, playlist: [{"id":"deaddon27tdie7-1560479443570","name":"Brains and Bones: Adam Driver and Chloe Sevigny on The Dead Don't Die","artist":"Jim Jarmusch, Adam Driver, Chloe Sevigny","title":"Brains and Bones: Adam Driver and Chloe Sevigny on The Dead Don't Die","tags":"@Zombies, Jim Jarmusch, Horror, Adam Driver, Chloe Sevigny, Comedy, Horror Movies, Film","genre":"Movies, Film, Comedy, Horror","poster":"https:\/\/thumbnails.consequenceofsound.net\/deaddon27tdie7-1560479443570\/thumb_00002.png","thumbnail":"https:\/\/thumbnails.consequenceofsound.net\/deaddon27tdie7-1560479443570\/thumb_00002.png","src":"https:\/\/videos.consequenceofsound.net\/deaddon27tdie7-1560479443570\/playlist.m3u8","type":"application\/x-mpegURL","target":"COSVideos","publisher":"Consequence of Sound"},{"id":"reimaginingstephenkingthecastandcrewonpetsematary-1554227857008","name":"Re-Imagining Stephen King: The Cast and Crew on Pet Sematary","artist":"Stephen King","genre":"Movies, Film, Horror ","title":"Re-Imagining Stephen King: The Cast and Crew on Pet Sematary","tags":"@Stephen King, Interviews, Pet Sematary, Horror, Horror Movies, Movies, Interview","poster":"https:\/\/thumbnails.consequenceofsound.net\/reimaginingstephenkingthecastandcrewonpetsematary-1554227857008\/thumb_00015.png","thumbnail":"https:\/\/thumbnails.consequenceofsound.net\/reimaginingstephenkingthecastandcrewonpetsematary-1554227857008\/thumb_00015.png","src":"https:\/\/videos.consequenceofsound.net\/reimaginingstephenkingthecastandcrewonpetsematary-1554227857008\/playlist.m3u8","type":"application\/x-mpegURL","target":"COSVideos","publisher":"Consequence of Sound"},{"id":"spicegirlsrammsteinsetlist-1560281006695","name":"Tour Stop: Spice Girls, Rammstein, Paul McCartney","artist":"Spice Girls, Rammstein, Paul McCartney, The Beatles","title":"Tour Stop: Spice Girls, Rammstein, Paul McCartney","genre":"Music, Pop, Rap, Heavy, Classic Rock","tags":"@Spice Girls, Rammstein, Paul McCartney, The Beatles, Pop, Rap, Heavy, Classic Rock, Setlist, Setlist.fm, Tour","poster":"https:\/\/lnthumbnails.consequenceofsound.net\/spicegirlsrammsteinsetlist-1560281006695\/thumb_00002.png","thumbnail":"https:\/\/lnthumbnails.consequenceofsound.net\/spicegirlsrammsteinsetlist-1560281006695\/thumb_00002.png","src":"https:\/\/lnvideos.consequenceofsound.net\/spicegirlsrammsteinsetlist-1560281006695\/playlist.m3u8","type":"application\/x-mpegURL","target":"lnVideos","publisher":"Consequence of Sound"},{"id":"noelgallaghersetlist-1560281383013","name":"Noel Gallagher, Oasis, Greta Van Fleet, Rock, Rock Music, Tour, Setlist.fm, Setlist","artist":"Noel Gallagher, Oasis, Greta Van Fleet","title":"Tour Stop: Noel Gallagher's High Flying Birds, Greta Van Fleet, The Chemical Brothers","genre":"Music, Rock, Rock Music","tags":"@Noel Gallagher, Oasis, Greta Van Fleet, Rock, Rock Music, Tour, Setlist.fm, Setlist","poster":"https:\/\/lnthumbnails.consequenceofsound.net\/noelgallaghersetlist-1560281383013\/thumb_00002.png","thumbnail":"https:\/\/lnthumbnails.consequenceofsound.net\/noelgallaghersetlist-1560281383013\/thumb_00002.png","src":"https:\/\/lnvideos.consequenceofsound.net\/noelgallaghersetlist-1560281383013\/playlist.m3u8","type":"application\/x-mpegURL","target":"lnVideos","publisher":"Consequence of Sound"},{"id":"cossteph1-1501859611596","name":"Stephen King's Top Horror Movie Adaptations","artist":"Stephen King","genre":"Movies, Horror, Film","title":"Stephen King's Top Horror Movie Adaptations","tags":"@Stephen King, Horror, movies, film, top movies","poster":"https:\/\/thumbnails.consequenceofsound.net\/cossteph1-1501859611596\/thumb_00001.png","thumbnail":"https:\/\/thumbnails.consequenceofsound.net\/cossteph1-1501859611596\/thumb_00001.png","src":"https:\/\/videos.consequenceofsound.net\/cossteph1-1501859611596\/playlist.m3u8","type":"application\/x-mpegURL","target":"COSVideos","publisher":"Consequence of Sound"}], showPlaylist: true, autoPlay: true, sticky: true, stickyParentId: 'sidebar', stickyTopOffset: 60, containerId: "video_8218", adUnit: '/134312942/COS_VIDEO_PREBID', targeting: [], appnexusAccountId: '', comscorePublisherId: 21854097, shareUrlPrefix: window.location.protocol + '//' + window.location.hostname + '/videoembed?video-id=' }); Danny Boyle confirms 28 Days Later sequel: “Alex Garland and I have a wonderful idea” Michael Roffman |
Crude Oil Price Update – Strengthens Over $58.03, Weakens Under $57.29
U.S. West Texas Intermediate crude oil futures are trading higher on Monday shortly after the regular session opening in a relatively low volume, low volatility session. Concerns over potential escalating tensions between the U.S. and Iran are helping to underpin the market, while gains are being limited by the possibility the two sides will sit down at the negotiation table.
At 13:00 GMT,August WTI crude oilis trading $57.93, up $0.50 or +0.85%.
The main trend is up according to the daily swing chart. The uptrend continued earlier today when buyers took out Friday’s high at $57.98. The trend will resume on an intraday basis if buyers can take out $58.22.
The main trend will turn down on a trade through $50.98. This is highly unlikely, but the market is in a position to post a potentially bearish closing price reversal top.
The main range is $64.03 to $50.79. The market is currently testing its retracement zone at $57.41 to $58.97. This zone is controlling the near-term direction.
If a range forms between $50.79 and $58.22 then its retracement zone at $54.51 to $58.97 will become the primary downside target.
Based on the earlier price action, the direction of the August WTI crude oil market will be determined by trader reaction to Friday’s close at $57.43.
A sustained move over $57.43 will indicate the presence of buyers. If this move creates enough upside momentum then look for buyers to make another run at the downtrending Gann angle at $58.03, followed by today’s intraday high at $58.22.
Taking out $58.22 could trigger an extension of the rally into the Fibonacci level at $58.97. Look for an acceleration to the upside if buyers take out this level with conviction. This could trigger a move into the next downtrending Gann angle at $61.03.
A sustained move under $57.43 will signal the presence of sellers. Taking out the 50% level at $57.41 and the uptrending Gann angle at $57.29 will indicate the selling pressure is getting stronger. This could trigger an acceleration to the downside with the next target a 50% level at $54.51.
Basically, the market just needs to close higher today or a closing price reversal top will form. If confirmed this could lead to a 2 to 3 day correction. Another way to look at the market: Stronger over $58.03, weaker under $57.29.
Thisarticlewas originally posted on FX Empire
• EUR/USD Price Forecast – Euro stalls during Tuesday session
• AUD/USD Price Forecast – Australian dollar continues to grind higher
• Silver Price Forecast – Silver markets go back and forth on Tuesday
• S&P 500 Price Forecast – Sock markets continue to meander
• GBP/USD Price Forecast – British pound runs into major resistance
• Natural Gas Price Forecast – Natural gas markets fall slightly on Tuesday |
France hosts Mediterranean conference without heads of state
PARIS (AP) — France is hosting a conference aimed at boosting cooperation between northern and southern Mediterranean countries, with senior government officials, non-governmental organizations, businesses and academics in attendance. President Emmanuel Macron took part in talks at the "Summit of the Two Shores" in the southern French port of Marseille on Monday. Participants from Mauritania, Morocco, Libya, Tunisia, Algeria, Spain, Italy, France, Malta and Portugal addressed a range of issues covering sustainable development, education, culture and access to technology, in the presence of foreign ministers from the 10 countries. French Foreign Minister Jean-Yves Le Drian said the summit was an opportunity to "revive multilateralism." The chaotic situation in Libya and the political crisis in Algeria didn't allow a meeting of heads of states as initially planned when Macron launched the initiative last year. |
Bitcoin Topping $11,000 Propels Crypto-Linked Stocks Higher
(Bloomberg) -- Stocks with exposure to bitcoin are rallying in pre-market trading after the cryptocurrency traded above $11,000 for the first time in 15 months.
Crypto-linked securities with pre-market gains include: Grayscale Bitcoin Trust BTC, which is gaining 7.8%; Riot Blockchain Inc., which is up 4.8%, DPW Holdings Inc. which is rising 6.7%, and Marathon Patent Group, up 3.7%.
Some have suggested bitcoin is benefiting from new optimism as Facebook Inc. has decided to push into cryptocurrencies with its new coin, Libra.
To contact the reporter on this story: Felice Maranz in New York at fmaranz@bloomberg.net
To contact the editors responsible for this story: Catherine Larkin at clarkin4@bloomberg.net, Richard Richtmyer
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Here's Why the Hottest Marijuana Debut of 2019 Is Bad News
Marijuana is arguably the hottest investment on Wall Street right now. Although cannabis stocks have underperformed a bit since the beginning of May, their performance, when looked at over the past couple of years, has run circles around broader-market returns.
Within the next decade, the global cannabis industry could be generating north of $50 billion, andperhaps even $75 billion, in annual sales, according to various Wall Street estimates. This means the entire cannabis supply chain, from growers to ancillary players, could make investors a lot of money. And it just so happens that a new type of ancillary player debuted on theNasdaqlast week in a first-of-its-kind listing.
Image source: Getty Images.
One week ago today, MTech Acquisitions, a shell company focused on making acquisitions, and cannabis-software services company MJ Freeway, completed their merger that was first announced in October. Upon completion, the new entity,Akerna(NASDAQ: KERN), began trading on the Nasdaq on Tuesday, June 18. This marked the first time that a cannabis company had listed on the Nasdaq without an initial public offering or an uplisting from the over-the-counter exchange.
Akerna's first day of trading was rather tame, with the company's stock closing at $14.85 a share on just over 120,000 shares traded. But business picked up in a big way on Wednesday and Thursday, with more than 3 million shares traded each day. Akerna's valuation more than tripled on Wednesday to a close of $49.80, then briefly gained another nearly 50% to hit just shy of $73 early Thursday morning before retreating.
What has investors so excited about this newly listed pot stock that they felt it was worth a nearly 400% premium in a matter of two days? The answer lies in the company's business model, which is something investors haven't seen listed on the Nasdaq before.
Akerna's primary focus is on developing software unique to the cannabis industry. In other words, it didn't take software designed for another sector or industry and design it to fit the marijuana model. Rather, the MJ Freeway team has been developing and refining software for around a decade that handles two primary functions for weed businesses: seed-to-sale technology and consulting services.
Image source: Getty Images.
The company's seed-to-sale technology platform is arguably its most valuable. With a number of states requiring airtight oversight on their pot industry, Akerna's software can be utilized to accurately track each and every marijuana plant from when it was a seed to when it's sold in stores. As long as the U.S. federal governmentclassifies cannabis as an illicit substance, thereby disallowing interstate transport of the drug, seed-to-sale tracking will prove very important.
Meanwhile, the company's consulting services primarily focuses on helping marijuana businesses better understand their customers. Akerna's services can be used to improve customer retention, bolster compliance, and even aid with license applications.
All told, Akerna's notes in its filing with the Securities and Exchange Commission that it has clients in 29 of the 33 medical marijuana-legal U.S. states, as well as 11 countries worldwide (including the U.S.).
On the surface, Akerna has a business model that investors can easily rally around. I see plenty of long-term value in seed-to-sale tracking and client services that improve customer retention. Remember, this is an industry that's been dominated by cash due to banks being unwilling to offer basic banking services. Therefore, software that can help dispensaries and growers better understand what consumers want, as well as how to keep them loyal to a brand or business, could prove invaluable.
But this is an instance where I love the business model, but simply don't like the valuation one bit. There are a number of red flags that investors should be aware of before they consider dipping their toes into the hottest cannabis stock on Wall Street.
Image source: Getty Images.
For starters, the company's financials are a bit of an eyesore. Based on the combined company'sSEC filingdated May 14, MJ Freeway has generated just $4.97 million in sales through the first six months of its current fiscal year, ended Dec. 31, 2018. That's down -- yes,down-- from the $5.53 million in sales the company recorded during the equivalent time period in the previous year. Not surprisingly, gross profit declined year over year, and net loss rose to just shy of $4 million from $2.9 million. MJ Freeway wound up blaming weaker revenue from Washington State, as well as lumpy consulting service contract revenue, for the dip in year-over-year results.
That brings me to the next point: Akerna is overly reliant on two customers. The company's Leaf Data Systems compliance tracking software (i.e., its seed-to-sale tracking technology) has two clients -- Washington and Pennsylvania -- that accounted for 43% of the company's total sales through the first six months of its current fiscal year. Any change in these contracts could result in a substantial decline in revenue. And it's also worth noting that lumpy government contracts that require Akerna to bid against other software developers will likely represent the company's core source of sales for the foreseeable future.
Another concern is that Akerna's plans for growth involves an "aggressive acquisition strategy," according toInvestor's Business Daily. While an aggressive acquisition strategy has worked out OK for marijuana stocks likeAurora Cannabis, it could be problematic for Akerna, which did raise capital with its Nasdaq debut via share sales, but is likely going to need to issue more common stock in order to raise sufficient funds for acquisitions. This suggests thatsignificant share-based dilutionawaits shareholders of the company.
Image source: Getty Images.
Last, but not least, the proverbial kiss of death among pot stocks: material weaknesses in internal control over financial reporting. As noted in the company's SEC filing:
MJF [MJ Freeway] had previously identified material weaknesses in its internal control over financial reporting related to controls over its formal documentation and development of its policies and procedures, and the availability of sufficient resources to establish segregated review functions and documentation of financial data.
Akerna has hired a chief financial officer and added to its accounting staff as a means to better improve its internal financial reporting, but this is obviously a big worry given how badly a handful of pot stocks have been hit followinga lack of proper internal financial controls.
Again, while I do like the business model, there are simply a laundry list of reasons why this newly listed pot stock should be left out of your portfolio.
More From The Motley Fool
• Beginner's Guide to Investing in Marijuana Stocks
• Marijuana Stocks Are Overhyped: 10 Better Buys for You Now
• Your 2019 Guide to Investing in Marijuana Stocks
Sean Williamshas no position in any of the stocks mentioned. The Motley Fool recommends Nasdaq. The Motley Fool has adisclosure policy. |
Is National Beverage Corp.'s (NASDAQ:FIZZ) ROE Of 49% Impressive?
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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). We'll use ROE to examine National Beverage Corp. (NASDAQ:FIZZ), by way of a worked example.
National Beverage has a ROE of 49%, based on the last twelve months. One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.49 in profit.
See our latest analysis for National Beverage
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for National Beverage:
49% = US$151m ÷ US$305m (Based on the trailing twelve months to January 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is the capital paid in by shareholders, plus any retained earnings. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the amount earned after tax over the last twelve months. That means that the higher the ROE, the more profitable the company is. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As is clear from the image below, National Beverage has a better ROE than the average (20%) in the Beverage 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.
Companies usually need to invest money to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. That will make the ROE look better than if no debt was used.
Shareholders will be pleased to learn that National Beverage has not one iota of net debt! Its high ROE indicates the business is high quality, but the fact that this was achieved without leverage is veritably impressive. After all, when a company has a strong balance sheet, it can often find ways to invest in growth, even if it takes some time.
Return on equity is useful for comparing the quality of different businesses. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have the same ROE, then I would generally prefer the one with less debt.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of 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. |
3 Top High-Yield Tech Stocks
The tech industry tends to be less generous with dividend payments than other market segments such as consumer staples and utilities. However, if you know where to look, you can still find robust yields backed by strong businesses.
Below, three Fool contributors will look at a few standout tech stocks that promise investors healthy yields, plus a good chance at capital appreciation. Here's whyHP(NYSE: HP),Activision Blizzard(NASDAQ: ATVI), andCorning(NYSE: GLW)deserve a spot on your income watch list.
Image source: Getty Images.
Leo Sun(HP):HP's stock declined about 15% over the past 12 months as sales of its PCs and printers decelerated. The PC business struggled with long upgrade cycles, competition from mobile devices, andIntel's ongoing chip shortage throttling supplies of current-gen CPUs. The printing business faced soft hardware sales and rising competition from generic ink and toner suppliers.
However, that sell-off reduced HP's forward P/E ratio to 9 and boosted its forward dividend yield to 3.4%. HP spent just 7% of its free cash flow and 20% of its earnings on its dividend over the past 12 months, and it's raised that payout every year since it split withHewlett-Packard Enterprisein late 2015.
The bears will argue that HP is cheap because the PC market is weak and competition from generic printer suppliers won't wane. However, PC shipments should improve once Intel resolves its chip issues later this year. HP is also scaling up its printing business with its acquisitions ofSamsung's printing unit and office equipment dealer Apogee, as well as its introduction of industrial 3D printers.
HP is also aggressively expanding its printing supply subscription service, Instant Ink, to lock in customers and widen its moat against generic rivals. Operating margins at both the PC and printing businesses expanded sequentially and annually last quarter, thanks to tighter cost controls, and HP continues to spend most of its free cash flow on buybacks to boost its EPS growth. Therefore, HP might not rally over the next few quarters, but it's still anundervalued income stockfor patient investors.
Steve Symington(Activision Blizzard):Even with its solid annual $0.37-per-share dividend yielding roughly 0.8% at today's prices, you might not consider Activision Blizzard a "high-yield" tech stock in the traditional sense. But with shares down nearly 50% from their all-time high set last September, and keeping in mind the massively profitable video gaming titan has increased its payout each year since starting with a $0.15-per-share payment in 2010, investors betting on a rebound have a chance to snag an artificially high yield right now.
To be fair, Activision's plunge wasn't entirely without merit. Though the company postedslightly better-than-expectedfirst-quarter results in May, revenue still declined around 7%, to $1.83 billion, and net income was flat at roughly $603 million, or $0.78 per share. Investors were less impressed, however, the drops in monthly active users (MAUs) at Activision Blizzard's namesake segments were only partially offset by growth at its burgeoning King mobile gaming business.
But there are afew catalyststhat could help Activision resume its rise, including promises of more frequent content releases, investments to drive incremental growth from flagship console and PC titles likeOverwatch,Call of Duty, andWorld of Warcraft, and plans to port some of its most popular franchises to mobile platforms.
If all goes well, that could mean investors who buy today enjoy a delightful combination of a decent dividend yield and good old-fashioned share-price appreciation.
Demitri Kalogeropoulos(Corning):You wouldn't know it by simply reviewing the stock price movement, but Corning is off to a strong start to fiscal 2019. The display and optical communications giant notcheddouble-digit sales growthand a 22% spike in core earnings in the first quarter as it won market share across each of its five major product divisions. CEO Wendell Weeks and his team expect those generally positive trends to carry through for the rest of the year as well.
Image source: Getty Images.
Wall Street chose instead to focus on the company's revised growth outlook for the key optical communications segment that is now on pace to rise by about 10% rather than the low-teens rate management had initially forecast. That downgrade is simply due to the shifting of order timing for one large customer, Corningsaid back in late April, and doesn't reflect any worsening of its market share trends.
That means income investors have a chance to buy this stock, and its current 2.8% dividend yield, at lower prices than at the start of this year. With broader tech indexes up almost 20% in 2019, it's rare to find such a large discount on a well-performing business.
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Demitrios Kalogeropoulosowns shares of Activision Blizzard.Leo Sunhas no position in any of the stocks mentioned.Steve Symingtonhas no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Activision Blizzard. The Motley Fool is short shares of Hewlett Packard Enterprise Co. The Motley Fool recommends Corning. The Motley Fool has adisclosure policy. |
WTO says G20 erected 20 new trade barriers, although 29 barriers fell
GENEVA (Reuters) - The world's 20 most advanced economies, the G20, erected 20 new trade restrictions between October and May, covering trade worth $335.9 billion, the World Trade Organization said on Monday, warning that several more were being considered.
Together with trade barriers covering $480.9 billion in the previous period, the rise in new barriers represents "a dramatic spike" in import restrictions, the WTO said in a regular monitoring trade report before a G20 meeting.
"The stable trend that we saw for almost a decade since the financial crisis has been replaced with a steep increase in the size and scale of trade-restrictive measures over the last year," WTO chief Roberto Azevedo said in a statement.
"This will have consequences in increased uncertainty, lower investment and weaker trade growth," he said, adding that there was an urgent need for leadership from the G20, whose leaders will meet later this week in Osaka, Japan.
The WTO statement noted that several more significant trade restrictions were being considered, compounding the challenges and uncertainty in the global economic environment.
The monitoring report said G20 economies also implemented 29 measures to reduce trade barriers during the period, covering $397.2 billion.
Although greater than the number of barriers being erected, the new trade-liberalising measures were the lowest monthly average since the WTO began monitoring in May 2012, while new trade restrictions were more than 3.5 times higher than the average in WTO monitoring reports since then.
(Reporting by Tom Miles; editing by Stephanie Nebehay and Toby Chopra) |
Where Will Plug Power Be in 5 Years?
It's easy to think of hydrogen fuel cell technology as a "start-up" industry, but fuel cell specialistPlug Power(NASDAQ: PLUG)has been around for more than 20 years! And, honestly, its early investors don't have much to show for their enthusiasm.
But there are signs that Plug may have an opportunity to shake off the doldrums that have plagued it and hydrogen fuel cell stocks in general. Here are the three places Plug and its investors may find themselves in 2024.
Hydrogen fuel cell company Plug Power's technology is found primarily in material-handling vehicles like forklifts. Image source: Getty Images.
Fuel cell technology, a clean -- or,in some cases,mostlyclean -- technology, is a means of generating combustion-free electrical power. Its big rival is, of course, the rechargeable electric battery. While both were originally touted as green power sources for passenger vehicles, in recent years batteries have been handily winning that battle.
Justlook at the numbers:Information Trendsestimates there were about 6,500 fuel-cell vehicles on the road across the globe in 2017. But according to the International Energy Agency, that year there were about 3.1 million electric vehicles on the road worldwide. And that was beforeTeslaramped up production of its popular Model 3.
Fuel cells have been relegated mostly to powering material-handling vehicles (read: forklifts) and some airport vehicles. While Plug -- and others -- are making small forays into other markets, like delivery vans, there hasn't been widespread adoption. And Plug really needs to grow, because its finances aren't in great shape.
Plug has never posted an annual profit, despite consistently growing its revenue. In the fourth quarter of 2018, itmanaged to squeak outpositive adjustedEBITDAfor the first time ever, which encouraged investors who hoped consistent profitability might be around the corner. But the first quarter of 2019 disappointed, with not only lower year-over-year billings but a bigger year-over-year adjusted EBITDA loss and higher inventories. Shares, naturally, slid on the announcement.
If Plug can't manage to turn a profit and if widespread (or even just wider-spread) adoption of fuel cell technology remains elusive, there's a very real possibility that the company might simply pull the plug (sorry: couldn't resist) and go out of business.
However, there are some signs that may not happen.
Plughas a historyof providing rosy financial projections to investors and not following through -- which is why CEO Andy Marsh's claims that Plug would turn a profit in 2019 were met with some skepticism by investors. Marsh had also been teasing that Plug would be announcing some new global partners, and on the Q1 2019 earnings call, confidently announced he had "four [partnership announcements] in my pocket."
It seems as though these predictions may be coming to fruition. On May 28, Plug announced it was partnering with electric-vehicle manufacturer StreetScooter to provide 100 hydrogen fuel cell-powered delivery trucks to logistics and delivery heavyweightDeutsche PostDHL. Delivery of the trucks is set to begin in 2020.
Then, on June 11, Plug announced its acquisition of Canadian fuel cell specialist EnergyOr, which added ultralightweight fuel cells to Plug's portfolio. EnergyOr had been developing these systems for use in robotics and aerospace applications, which represents an expansion of Plug's current portfolio. However, shares have tumbled since that announcement, possibly reflecting investors' expectations of something bigger.
While still fairly small in scale, these new developments show that Plug still has opportunities to expand beyond its core material-handling market. Hydrogen bulls would say that this illustrates the massive opportunity for hydrogen tech in general and Plug Power in particular. If Plug can score more wins like these, it could finally shake off its financial doldrums and perhaps scale up to launch a serious challenge to batteries. In five years, Plug could be doing very well.
Hydrogen bears would caution that 100 delivery vehicles is a good start, but isn't going to sustain the company for long. They might add that hydrogen's promise is nothing new, and that Plug has failed to capitalize on that promise for years.
Indeed, hydrogen has some advantages over batteries. For example, the speed with which a hydrogen fuel cell can be recharged -- in just a few minutes -- makes the technology a good choice for industries in which a vehicle can't be offline charging for several hours at a time. On its website, Plug touts that its fuel cells are less subject to degradation, take up less room, and cost less to operate.
But battery-powered vehicles aremaking big splashes-- see Tesla's Model 3 and proposed Model Y and battery-powered pickup truck -- while fuel cells...aren't. Perhaps one of the big announcements Plug has been teasing is going to be revolutionary, but what seems more likely is that we'll see more of the same from Plug: some small incremental improvements, maybe even consistent -- albeit low -- profitability, and fuel cells still stuck as a mostly niche product.
That doesn't really seem like a winning proposition for investors.
It's unclear where Plug will be in five years...and that's actually not good for the hydrogen fuel cell manufacturer. While it seems to have several potential paths to growth, none of them seem to be sure things, and none of them look like proven winners. Plug could pull a game-changer out of its pocket, but as with many things about new technology, there's no guarantee.
Unless you have an exceptionally high tolerance for risk or are a true believer in hydrogen fuel cells, you'll probably want to stay on the sidelines.
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Who Has Been Selling Frank's International N.V. (NYSE:FI) Shares?
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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellFrank's International N.V.(NYSE:FI), you may well want to know whether insiders have been buying or selling.
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia Universitystudyfound that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
See our latest analysis for Frank's International
Over the last year, we can see that the biggest insider sale was by the Supervisory Director, Donald Mosing, for US$27m worth of shares, at about US$7.95 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$5.47. So it may not tell us anything about how insiders feel about the current share price.
Over the last year, we note insiders sold 7.0m shares worth US$57m. In the last year Frank's International insiders didn't buy any company stock. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
The last three months saw significant insider selling at Frank's International. Specifically, Supervisory Director Steven Mosing ditched US$2.0m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Frank's International insiders own 55% of the company, currently worth about US$683m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
An insider sold stock recently, but they haven't been buying. And even if we look to the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course,the future is what matters most. So if you are interested in Frank's International, you should check out thisfreereport on analyst forecasts for the company.
But note:Frank's International may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with high ROE and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Deutsche Bank Remains Bullish on UBER and Facebook Stocks
Does Uber Stock Deserve More Long-Term Optimism?
Uber’s (UBER) debut on the stock market at the beginning of May was among the largest ever, but so far investors aren’t too sure how to analyze the company. While the company has high hopes for the future — including with self-driving cars and being the go-to destination for all transportation — the short-term looks murky. Uber continues to burn through cash, especially as it expands into more cities around the world, while drivers are increasingly unhappy with the way the company treats them.
But at the end of the day, the company is growing its revenue and out playing its rivals.Lloyd Walmsleyof Deutsche Bank sees this as a reason to be bullish, as he maintains his Buy rating on UBER stock, with $58 price target, which implies nearly 32% upside from current levels. (To watch the Walmsley's track record,click here)
Walmsley noted, "We are bullish on Uber and see continued evidence the competitive market continues to improve, with reports from drivers that Lyft (not covered) has communicated plans to reduce driver payouts 4-5% on two drive modes broadly across the US. We see lower driver payouts on stable consumer pricing leading to improving unit economics in the form of improving revenue take-rates. While this seems to be catch-up to lower driver payouts at Uber on similar (and somewhat limited) ride types, we view Lyft moving to Uber as a clear sign competition is rationalizing in the US and feel better about our outlook for improving take rates at Uber."
Another factor in Walmsley’s opinion is Uber’s performance in Latin America. The analyst believes “the Latin American market is also stable for Uber,” as the company continues to reach beyond the US. Furthermore, Walmsley believes “fears around competition in the UK are overblown,” saying Bolt and Ola are not meaningful threats to the giant.
Uber announced its first-ever quarterly earnings at the end of May, reporting a loss of about $1 billion on revenue of $3 billion, about 20% higher than this time last year. Total bookings increased 34% to more than $14 billion, as active users rose to 93 million. While perhaps its market cap of $74 billion is not justified by its earnings, many are still looking to the future when (the hope is) labor costs are cut and the company sees stability in foreign markets.
All in all, though only a handful of analysts were bullish on Uber at the time of its debut, more and more analysts are coming around.TipRanks analysisof 27 analyst ratings shows a consensus Strong Buy rating, with 21 analysts recommending Buy and six Holding. The average price target for the stock stands at $54.23, suggesting the stock can rise about 23% from current levels.
Crypto Move Boosts Facebook Stock, But How Will It Play In Long Term?
With the tech world going crazy over Facebook (FB) recently announcing its new cryptocurrency Libra, FB stock is responding in kind. Up double-digits this month, many are excited over the company’s new task of making a worldwide currency, which will be used by Facebook users to buy items on the platform and pay each other through Messenger. While crypto’s best came last year, there is still hope among many that it will eventually become mainstream. Facebook hopes to play a role in this, as the company’s massive platform will allow it to provide security and regulation.
Walmsley has questions about the new coin, but overall, the analyst is maintaining his Buy rating on Facebook stock with $220 price target, which implies nearly 23% from current levels.(To watch Walmsley's track record,click here)
Though Walmsley says he likes the strategic play with Libra and Facebook-developed digital wallet Calibra and the magnitude of the ambition behind it, he still has many questions around whether it can really live up to the recent hype.
The big question is whether Libra can scale. If this happens, he Walmsley says “reduced friction in E-commerce can increase the value of Facebook ads, and it can generate interest income on the currency collateral and open the door to more financial products.” Essentially, it will open up new revenue streams for a company that relies (almost) exclusively on ad income.
Walmsley also believes that the coin adds “more utility to core Facebook” and will play a role in “reducing the risk users simply leave the...app.” Further, it “enhances the utility of WhatsApp and Messenger, moving them a (small) step closer towards replicating the WeChat’s SuperApp functionality,” by making it extremely simple and safe to send money to peers and sellers.
Though Walmsley is positive on the new coin from a product standpoint, as it will help drive revenue and increase engagement on Facebook, he is concerned about regulation. The analyst points out that “intense regulatory scrutiny, lingering trust issues with Facebook, management by committee - among other concerns - weigh heavily in our minds vis-a-vis the ultimate success of the project.” The company is currently under the microscope in Europe and the US, and an attempt to now get into finance will most likely pull other regulatory agencies into the matter. Even so, given Facebook’s prowess across the line, the analyst remains a bull and sees “healthy upside potential to [his] $220 target.”
All in all, this latest move is expected to make the popular company even more so. Most analysts on Wall Streets are out rooting for this social media titan to be a winning stock pick, asTipRanks analyticsshowcase FB as a Strong Buy. Based on 30 analysts polled in the last 3 months, 35 rate a Buy on Facebook stock while 3 maintain a Hold. The 12-month average price target stands at $220.20, marking a nearly 15% upside from where the stock is currently trading.
Read more on the stocks mentioned:
• Facebook’s (FB) Libra Could Be the Next Big Thing
• Should Investors Buy Facebook (FB) Stock After Its Cryptocurrency Launch? Top Analyst Weighs In
• Uber (UBER) Faces the Public; Should You Buy the Stock?
• Why You Should Avoid Uber Stock Like the Plague
• Is 33% Upside Good Enough to Risk Buying Fitbit (FIT) Stock? Deutsche Bank Doesn't Think So
• Deutsche Bank Remains Sidelined on AMD Stock; Here's Why
• Antitrust Investigation Is Not a Major Threat to Alphabet (GOOGL) Stock, Says Top Analyst
• Tesla's (TSLA) Gigafactory Is Impressive, But Its Stock Isn't, Says RBC Capital |
How Much Are Frank's International N.V. (NYSE:FI) Insiders Taking Off The Table?
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sellFrank's International N.V.(NYSE:FI), you may well want to know whether insiders have been buying or selling.
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
See our latest analysis for Frank's International
In the last twelve months, the biggest single sale by an insider was when the Supervisory Director, Donald Mosing, sold US$27m worth of shares at a price of US$7.95 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$5.47. So it is hard to draw any strong conclusion from it.
In the last twelve months insiders netted US$57m for 7.0m shares sold. Insiders in Frank's International didn't buy any shares in the last year. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
The last quarter saw substantial insider selling of Frank's International shares. In total, Supervisory Director Steven Mosing dumped US$2.0m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that Frank's International insiders own 55% of the company, worth about US$683m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
An insider sold Frank's International shares recently, but they didn't buy any. And even if we look to the last year, we didn't see any purchases. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course,the future is what matters most. So if you are interested in Frank's International, you should check out thisfreereport on analyst forecasts for the company.
Of courseFrank's International may not be the best stock to buy. So you may wish to see thisfreecollection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
IBM Partners With Cloudera to Bolster Big Data Solutions
International Business MachinesIBM and Cloudera CLDR have entered into an agreement to built go-to-market initiative, which is aimed at bringing big data and AI solutions to users across the open Apache Hadoop ecosystem.
The initiative is aimed at managing big data workloads across multi-cloud, edge architectures and hybrid on-premises to help customers manage their data and access analytical and decision-making applications.
With rapid accumulation of data, enterprises require applications and security to help them arrive at business decisions faster than ever. The collaboration will cater to this need and also provide customized tools that can be deployed on-premise with hybrid cloud environments.
International Business Machines Corporation Price and Consensus
International Business Machines Corporation price-consensus-chart | International Business Machines Corporation Quote
Deal Details
Per the deal, IBM will be reselling Cloudera Enterprise Data Hub and Cloudera DataFlow to its customers. Meanwhile Cloudera will deploy IBM's Watson Studio and BigSQL. The agreement will expand IBM’s capabilities in big data analytics.
The strategic alliance between the two companies is based on the long-standing relationship between IBM and Hortonworks, which merged with Cloudera in January this year. Notably, IBM and Hortonworks will continue their collaboration made last June to provide enterprises with decision making power based on informative data output sets.
Hortonworks is a well-known developer of enterprise Apache Hadoop. Its Hortonworks Data Platform (HDP) is enterprise quality software that provides users with complete tools for test and quality assurance. HDP basically brings together the most useful and stable versions of Apache Hadoop and related projects into a single tested and certified package.
We believe this collaboration will help IBM’s customers take advantage of the hybrid data architecture, which enables quick decision making.
Apache Hadoop is an open source software which enable businesses to draw insights from huge amount of structured and unstructured data swiftly at a minimal cost. It primarily comprises three main functions, which include storage, processing and resource management.
Notably, software architecture built on Apache Hadoop aid businesses and enterprises process and survey new data sources, consequently arriving at new business insights. It is increasingly becoming a core component of enterprise data management systems as it allows organizations to cost-effectively capture, process and share data in any format and at any scale.
Through this agreement IBM will provide clients an open platform that helps to accelerate analytics, business processes, data processing and predictive capabilities. Additionally, the agreement will help organizations in generating instant results along with vast storage. Consequently, the agreement will improve business performance of its clients.
Bottom Line
In the first quarter of fiscal 2019, IBM's revenues from cloud and data platforms increased 2% year over year. Cloud revenues surged 25% year over year. The annual run rate for cloud as-a-service revenues was $7.5 billion. Revenues from Cognitive Applications were up 4% year over year, driven by security, health, supply chain and weather.
Given the alluring capabilities offered by IBM's hybrid cloud infrastructure, the latest deal is likely to bolster the top line, consequently aiding IBM to compete better against peers. The company has been a pioneer when it comes to helping businesses digitally transform and evolve. The tech giant continues to bring innovation to services to aid the enterprises leverage emerging technologies, including the likes of cloud, AI, IoT, among others.
However, rising competition from Amazon’s Amazon Web Services (AWS) and Microsoft Azure in the cloud infrastructure services market is a headwind.
Zacks Rank & Key Picks
IBM carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader technology sector are Match Group, Inc. MTCH and Autohome Inc. ATHM, each flaunting a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
Match Group and Autohome have a long-term earnings growth rate of 15.2% and 20.9%, respectively.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>
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 reportInternational Business Machines Corporation (IBM) : Free Stock Analysis ReportAutohome Inc. (ATHM) : Free Stock Analysis ReportMatch Group, Inc. (MTCH) : Free Stock Analysis ReportCloudera, Inc. (CLDR) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Hasbro: Tariffs could not come at a worse time for toy industry
Hasbro (HAS), the company behind iconic toys and games like Monopoly and Play-Doh, says new tariffs could drive up the cost of toys, devastate the industry and lead to safety risks.
The toymaker is one ofhundreds of companiesthat have been testifying in Washington over the past week, asking the Trump administration to spare them from the next round of tariffs.
Hasbro’s Chief Operating Officer, John Frascotti, is set to testify on Monday.
In comments submitted ahead of the testimony, the company told United States Trade Representative Robert Lighthizer that 85% of all toys sold in the U.S. are imported from China.
Right now, toys and games are on the list of $300 billion worth of Chinese goods that could face tariffs of up to 25%.
Hasbro argues the tariffs would cause “significant and disproportionate” economic harm to the toy industry and American families. The company estimates more tariffs could cut the toy industry’s contribution to the U.S. economy by $10.8 billion.
“This could not come at a worse time for our industry. We, and the U.S. toy industry overall, are facing serious headwinds from the recent bankruptcies of two major toy retailers, K-Mart and Toys ‘R’ Us, which have already put an estimated 30,000 U.S. jobs at risk,” said Kathrin Belliveau a senior vice president at Hasbro, in comments submitted to USTR ahead of the hearing.
Belliveau said the tariffs would make things worse, and lead to potential job losses throughout the industry — including at Hasbro.
Mattel (MAT) also submitted comments to USTR, saying the tariffs would put American jobs at risk.
“Although unskilled production operations typically occur in China, the U.S. toy, game and juvenile products industry maintains major product design, marketing and other key operations in the United States that would be negatively affected by tariffs on these product,” said Corinne Murat, Mattel’s director of government affairs, in the submitted comments.
Mattell said that in 2018, China accounted for $11.9 billion, or 84% of total U.S. imports of toys.
If the tariffs drive up the price of toys, Hasbro expects consumers will buy fewer of them – or buy cheaper, potentially unsafe toys instead.
“The tariffs could incentivize U.S. consumers to purchase cheaper, unsafe, counterfeit toys that do not meet stringent U.S. safety standards,” said Belliveau in the prepared comments.
Those safety standards are part of the reason toymakers say they are so dependent on Chinese manufacturers, and why that’s not likely to change anytime soon.
“A hasty change in sourcing could jeopardize the safety guardrails carefully constructed by U.S. toy companies for this supply chain,” said Murat.
“Our suppliers in China are qualified and trained to meet the strict U.S. product safety standards that apply to toys and games manufactured for use by children,” said Belliveau. “That workforce does not currently exist outside of China.”
Still, Hasbro says it has been trying to diversify its supply chain since 2012. At that time, it says 80% of the products sold in the U.S. came from China. In 2018, that number dropped to 67% and the company’s goal is to reach 60% by the end of 2020.
“In the meantime, Hasbro and other U.S. toy companies will have no choice but to continue importing toys and games from China and passing along the increased cost of the tariffs to American customers,” said Belliveau.
Right now, Hasbro says 20% of its toys and games sold in the United States is made in the United States.
In its prepared remarks, Hasbro said the tariffs would not accomplish the administration’s goal of boosting American manufacturing — but instead, the tariff burden would make it harder to move manufacturing outside of China.
In its prepared comments, Mattel made a similar argument, noting consumers will be hurt no matter how toy companies respond to the tariffs.
“It would be difficult to switch sourcing in the near future, meaning the proposed tariffs would result in higher consumer prices and reduced consumer choice. In the event increased tariffs eventually force U.S. toy companies to switch from their established Chinese suppliers, the companies would incur significant initial testing and certification costs associated with their new suppliers, again resulting in higher consumer prices,” said Murat.
Jessica Smith is a reporter for Yahoo Finance based in Washington, D.C. Follow her on Twitter at@JessicaASmith8.
Senators want to roll back tax cuts to create jobs for long-term unemployed
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Businesses head to DC to make their case against tariffs
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Does Packaging of America (NYSE:PKG) Deserve A Spot On Your Watchlist?
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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.
So if you're like me, you might be more interested in profitable, growing companies, likePackaging of America(NYSE:PKG). Even if the shares are fully valued today, most capitalists would recognize its profits as the demonstration of steady value generation. 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.
Check out our latest analysis for Packaging of America
If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. That makes EPS growth an attractive quality for any company. It certainly is nice to see that Packaging of America has managed to grow EPS by 21% per year over three years. As a general rule, we'd say that if a company can keep upthatsort of growth, shareholders will be smiling.
One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. While we note Packaging of America's EBIT margins were flat over the last year, revenue grew by a solid 7.0% to US$7.1b. That's progress.
In the chart below, you can see how the company has grown earnings, and revenue, over time. For finer detail, click on the image.
The trick, as an investor, is to find companies that aregoing toperform well in the future, not just in the past. To that end, right now and today, you can checkour visualization of consensus analyst forecasts for future Packaging of America EPS100% free.
Since Packaging of America has a market capitalization of US$8.9b, we wouldn't expect insiders to hold a large percentage of shares. But we are reassured by the fact they have invested in the company. Indeed, they have a glittering mountain of wealth invested in it, currently valued at US$126m. 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.
For growth investors like me, Packaging of America's raw rate of earnings growth is a beacon in the night. I think that EPS growth is something to boast of, and it doesn't surprise me that insiders are holding on to a considerable chunk of shares. 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. 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 Packaging of America is trading on a high P/E or a low P/E, relative to its industry.
Although Packaging of America certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
JetBlue sues Walmart for trademark infringement over Jetblack service
By Jonathan Stempel
NEW YORK (Reuters) - JetBlue Airways Corp has sued Walmart Inc for trademark infringement, in an effort to stop the world's largest retailer from using the name Jetblack for its text-based personal shopping service.
In a complaint filed on Friday night, JetBlue said Jetblack was a "transparent attempt" by Walmart to capitalize on the carrier's goodwill, and would likely cause "significant consumer confusion" as the service expands across the United States.
JetBlue also said Walmart intended further infringements by using other "Jet+color" names such as Jetgold and Jetsilver, and moving closer to JetBlue's core business by offering travel services, including dining and entertainment recommendations.
The complaint said JetBlue owns 43 federal trademark registrations for JetBlue marks dating as far back as 1999, the year before the Long Island City, New York-based carrier began flying passengers. JetBlue is now the sixth-largest U.S. airline.
Walmart launched Jetblack in New York City in May 2018, as part of the Bentonville, Arkansas-based retailer's effort to compete with such e-commerce services as Amazon.com Inc's Amazon Prime, especially in urban areas.
"We respect the intellectual property rights of others," Walmart spokesman Randy Hargrove said. "We take this issue seriously, and once we are served with the complaint will respond appropriately with the court."
The lawsuit filed in Manhattan federal court seeks unspecified compensatory and punitive damages. Jet.com, which Walmart bought in 2016, is also a defendant.
JetBlue and its lawyers did not immediately respond on Monday to requests for comment.
Jetblack calls itself a "personal shopping and concierge service that combines the convenience of e-commerce with the customized attention of a personal assistant," with "busy parents" among its target customers.
The business is a startup located within Store No. 8, which is Walmart's Silicon Valley-based incubation arm.
The case is JetBlue Airways Corp v Jet.com Inc et al, U.S. District Court, Southern District of New York, No. 19-05879.
(Reporting by Jonathan Stempel in New York; Editing by Susan Thomas and Phil Berlowitz) |
Amazon Never Stood a Chance Against Grubhub and Uber
Amazon.com(NASDAQ: AMZN)doesn't fail often, but today isthe end of the serving linefor its Amazon Restaurants platform. The leading online retailer's half-hearted attempt to compete againstGrubhub(NYSE: GRUB), DoorDash, Postmates,Uber Technologies'(NYSE: UBER)Uber Eats, and other hungry upstarts will officially stop taking orders this afternoon.
Amazon Restaurants wasn't shaping up to be a major contender in this niche, but that doesn't mean investors in the other restaurant-delivery apps aren't happy to see Amazon stage a retreat. Grubhub stock has soared 10% since Amazon announced its plans to nix its platform two weeks ago. Uber's stock has climbed a little better than 3%, ahead of the market's 2% advance in that time but not viewed by the market in the same light as Grubhub. Uber Eats is an important part of the leading ride-sharing provider, but it generates a lot more dough driving people around than it does driving baked dough to rumbling bellies.
Image source: Amazon Restaurants.
You can't succeed if you don't scale quickly in this niche, and Amazon was finding itself on the outside looking in. The four leading players -- again, Grubhub, Uber Eats, Postmates, and DoorDash -- combine for a whopping 93% of the market. Amazon Restaurants was an afterthought outside its home turf of Seattle, and that makes it hard when it comes to recruiting drivers for deliveries as well as securing top eateries for participation.
The top dogs won't miss seeing Amazon in their rearview mirror, even if it was already fading away. Amazon hasn't shied away in the past from subsidizing initiatives, taking near-term hits for the sake of long-term gains. However, Amazon realizes that if you're not a top dog in this booming market, it's going to be a challenge to round up the fleet of gig economy-fueled drivers to complete speedy deliveries. This is a particularly thorny issue for Amazon, because its flagship online retail business centers on its efficient fulfillment. If Amazon Restaurants wasn't going to delight its customers, it was going to be more of a liability than an asset.
The players that will be around to deliver dinner after today are growing nicely. Grubhub is coming off back-to-back years of accelerating revenue growth. Gross bookings for Uber Eats are growing even faster than both Grubhub and Uber's own flagship personal mobility service. Gobbling up the meals that Amazon will leave behind may not move the needle for either company, but it certainly doesn't hurt.
It's not just Grubhub and Uber that are licking their lips as Amazon Restaurants bows out. Postmates isgearing up to go publicthis summer, and DoorDash willinevitably follow suit. It will be easier to persuade investors to take a chance on the IPOs knowing Amazon isn't around to potentially wreak havoc. It may not seem like a major even for Amazon Restaurants to close up shop this afternoon, but it will make life easier for everybody else.
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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors.Rick Munarrizhas no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool recommends Grubhub and Uber Technologies. The Motley Fool has adisclosure policy. |
The Financial #adulting Checklist for College Grads
Follow these steps after you graduate to set yourself on the path to financial success.Image source: Getty Images.
Graduating from college is a major milestone. Hopefully you’ll be leaving school with a great full-time job and a generous salary. But you may also havedebt to payfrom earning your education, and you may be faced with some big financial responsibilities for the first time.
The steps you take immediately after graduation can affect your financial life for years, so you’ll want to make sure you do all the tasks necessary to manage your money like a responsible adult. If you’re not sure where to start when it comes to financial adulting, here are the seven key steps you’ll need to take.
Many college grads havestudent loansto pay back. While you have a grace period before payments start after graduation, getting on the right plan immediately is important so your payments are affordable and so you ideally won’t have this debt hanging over you for decades.
If you have federal student loans, you have multiple options for repayment including a standard plan with a 10-year repayment schedule with fixed payments; a graduated payment plan with payments that increase over time; or various income-based plans. Consider the pros and cons of each option, including monthly payment amount and total loan cost, to decide which is right for you.
You want to make sure you’re responsible with your income from your post-graduation job, and that means living on a budget. Your budget should prioritize saving, allocate an appropriate amount of money towards meeting essential obligations, and include some money set aside for fun.
Living on a budget will ensure you aren’t spending too much or wasting money, and will help you to accomplish financial goals.
If you don’t already have a credit card, you’ll need to get one after graduation so you canstart building credit. Look into a student card orsecured card, which can be easier to qualify for without a strong credit history.
Make sure you use your card responsibly, which means paying off the balance in full each month to avoid interest payments and paying on time to build a positive payment history. You’ll likely want to avoid cards with annual fees unless the card comes with generous perks and rewards you’ll definitely take advantage of. And you should make sure you don’t max out your cards, as using too much of your available credit can hurt your credit score.
Retirement probably seems very far away, but chances are good you’ll need to have over $1 million to have a comfortable life as a senior citizen by the time you hit retirement age. You need to start saving when you’re young to build a big enough nest egg to avoid financial worries during your golden years.
Ideally, you should save 15% to 20% of your income for retirement, including any employer match that your company may provide to you (an employer match is money your employer matches when you make 401(k) contributions).
If you can’t save 15% right away, start with saving as much of your income as you possibly can, and then increase the amount you save each time you get a raise. Both a 401(k) offered by your employer or an IRA you open with a broker provide you with tax breaks for saving that can make it easier to put aside money. If you set up automatic contributions from your paycheck right away when you start your job, you’ll never miss that extra money because you won’t get used to having it.
Now that you’re a financial adult, you face all of the potential life emergencies other adults face -- including things like unexpected car repairs, surprise medical expenses, or job loss. You need an emergency fund to cushion you against those bumps in the road so you don’t end up in debt or unable to pay your rent.
It’s ideal to have three to six months of living expenses in an emergency fund. It will likely take you time to save that much, but if you allocate at least some of your money each month toward an emergency savings account, you can start building up your fund ASAP.
In addition to an emergency fund and saving for retirement, it’s also a good idea to save up for other financial goals. You’ll probably also have some big expenses you’ll need to incur, whether that’s a vacation or weddings of friends or new furniture for your apartment. You’ll want to save up for all this stuff too.
To make sure you know what you’re saving for -- and that you’re saving enough -- set a few SMART financial goals. SMART goals are Specific, Measurable, Attainable, Relevant, and Timely. That means you should have a deadline for your goal, be specific about the dollar amount you want to save, and make sure your goal matters to you.
Once you have your goals, you can dedicate some of your budget to saving for them -- and can track your progress.
You may be able to stay on your parent’s health insurance until you’re 26 years old, but this isn’t always the best or most practical option. The key is to make sure you have some health coverage, whether you get it from your parent’s, an employer, or buy it on the individual market.
You should consider other types of insurance as well. If you’ll be driving, having auto insurance is required by state law. And if you rent a property, you should have renter’s insurance -- unless you could afford to replace all your possessions or to personally compensate someone who gets hurt in your apartment.
Having the right insurance is essential to protect you from devastating financial loss in case something goes wrong, so never go without a policy you need.
It may seem like a lot to do, but taking these seven steps can help you set yourself up for tremendous financial success. The sooner you start checking items off your financial adulting checklist, the better off you’ll be when it comes to managing money -- so start as soon as graduation day passes.
The Motley Fool owns and recommends MasterCard and Visa, and recommends American Express. We’re firm believers in the Golden Rule. If we wouldn’t recommend an offer to a close family member, we wouldn’t recommend it on The Ascent either. Our number one goal is helping people find the best offers to improve their finances. That is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team. |
FBIZ or LKFN: Which Is the Better Value Stock Right Now?
Investors interested in stocks from the Banks - Midwest sector have probably already heard of First Business Financial Services (FBIZ) and Lakeland Financial (LKFN). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
The best way to find great value stocks is to pair a strong Zacks Rank with an impressive grade in the Value category of our Style Scores system. The Zacks Rank favors stocks with strong earnings estimate revision trends, and our Style Scores highlight companies with specific traits.
First Business Financial Services and Lakeland Financial are sporting Zacks Ranks of #2 (Buy) and #3 (Hold), respectively, right now. This system places an emphasis on companies that have seen positive earnings estimate revisions, so investors should feel comfortable knowing that FBIZ is likely seeing its earnings outlook improve to a greater extent. But this is just one piece of the puzzle for value investors.
Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.
Our Value category grades stocks based on a number of key metrics, including the tried-and-true P/E ratio, the P/S ratio, earnings yield, and cash flow per share, as well as a variety of other fundamentals that value investors frequently use.
FBIZ currently has a forward P/E ratio of 10.34, while LKFN has a forward P/E of 13.72. We also note that FBIZ has a PEG ratio of 1.29. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. LKFN currently has a PEG ratio of 1.37.
Another notable valuation metric for FBIZ is its P/B ratio of 1.11. Investors use the P/B ratio to look at a stock's market value versus its book value, which is defined as total assets minus total liabilities. By comparison, LKFN has a P/B of 2.13.
These metrics, and several others, help FBIZ earn a Value grade of A, while LKFN has been given a Value grade of C.
FBIZ sticks out from LKFN in both our Zacks Rank and Style Scores models, so value investors will likely feel that FBIZ is the better option right now.
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 reportFirst Business Financial Services, Inc. (FBIZ) : Free Stock Analysis ReportLakeland Financial Corporation (LKFN) : Free Stock Analysis ReportTo read this article on Zacks.com click here. |
DFS vs. FCFS: Which Stock Should Value Investors Buy Now?
Investors looking for stocks in the Financial - Consumer Loans sector might want to consider either Discover (DFS) or First Cash Financial Services (FCFS). But which of these two companies is the best option for those looking for undervalued stocks? Let's take a closer look.
We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The proven Zacks Rank emphasizes companies with positive estimate revision trends, and our Style Scores highlight stocks with specific traits.
Both Discover and First Cash Financial Services have a Zacks Rank of # 2 (Buy) right now. This means that both companies have witnessed positive earnings estimate revisions, so investors should feel comfortable knowing that both of these stocks have an improving earnings outlook. But this is just one piece of the puzzle for value investors.
Value investors also tend to look at a number of traditional, tried-and-true figures to help them find stocks that they believe are undervalued at their current share price levels.
The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.
DFS currently has a forward P/E ratio of 8.91, while FCFS has a forward P/E of 25.17. We also note that DFS has a PEG ratio of 1.05. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. FCFS currently has a PEG ratio of 1.68.
Another notable valuation metric for DFS is its P/B ratio of 2.37. The P/B is a method of comparing a stock's market value to its book value, which is defined as total assets minus total liabilities. By comparison, FCFS has a P/B of 3.23.
Based on these metrics and many more, DFS holds a Value grade of A, while FCFS has a Value grade of C.
Both DFS and FCFS are impressive stocks with solid earnings outlooks, but based on these valuation figures, we feel that DFS is the superior value option right now.
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 reportDiscover Financial Services (DFS) : Free Stock Analysis ReportFirst Cash, Inc. (FCFS) : Free Stock Analysis ReportTo read this article on Zacks.com click here. |
Google Pay, PayPal Integration Revs Up Payments System Market
Alphabet’s GOOGL Google division recently announced a unique integration with PayPal PYPL by which Google Pay users can access their PayPal account as a check-out option.The latest integration enables Google Pay users to switch between their saved payments methods, now including PayPal, apart from debit and credit cards and other options.Moreover, users can access PayPal benefits including Return Shipping and Purchase Protection capabilities which in turn ensure hassle-free and secure online payment experience.The extended Google Pay-PayPal partnership is expected to strengthen the presence of both the companies in the digital payment market, currently projected to hit $7.64 trillion by 2024 from approximately $3.42 trillion in 2018, per ResearchAndMarkets.Per ‘World Payments Report 2018’ by Capgemini and BNP Paribus, the digital payment volume is expected to reach 876.4 billion by 2021. In order to reap benefits from this expanding market, the tech giants are coming up with innovative applications.The strengthening relation between Google and Paypal also improves their competitive position against tech-giants like Apple AAPL, Amazon AMZN, Samsung and Square SQ.Year-to-Date Price Performance
Win-Win for Both Google Pay and PayPalGoogle allows PayPal account holders to make payments without signing in to their PayPal accounts which in turn makes the payment process a lot easier and quicker. Once the PayPal account is linked with Google Pay, customers can pay their bills or make peer-to-peer transfers across the entire Google ecosystem.Apart from Google, PayPal’s expanding partner base includes Facebook, Visa and Mastercard, which will continue to aid it in enhancing payment services.Given the widescale adoption of Android smartphones, expanding international presence and partner base, Google Pay is expected to gain a competitive edge over its fellow peers in the digital payments market.The latest development on Google Pay and PayPal partnership highlights the ongoing hybrid ecosystem in payment methods, wherein companies are reluctant to miss out on business owing to rigidity in check-out options.The companies are integrating their respective payment portals to provide seamless online experience to end-users. These initiatives are expected to bolster growth of transactional revenues and strengthen partner base.Apple, Samsung, Amazon & Square Trying to Foil Google’s PlanIt would be foolish to ignore the initiatives undertaken by tech giants like Apple, Amazon, Samsung and Square in this space.Apple Pay is performing well in the market on increasing clientele and partner base, now including retailers like Taco Bell and Target. It was recently launched in the Netherlands, and is reportedly set to foray in Slovakia as early as Jun 26.Further, Amazon is offering customer-friendly offers on its payment app via its online shopping platform. The company recently announced significant investment in India in a bid to expand usage of Amazon Pay in the country, touted to be an emerging market for digital payments services.Samsung Pay is also gaining traction by expanding globally. Samsung introduced its payment app in South Africa this March. It already exists in Brazil, India, UAE and France among other countries. The company also rolled out Samsung Pay on its select wearables, including Samsung Galaxy Watches to allow seamless online transactions.Moreover, Square seems to be on an impressive run with strong adoption of its payments and POS services including Square Terminal, Square Stand, Instant Deposits, Square Invoices, Cash Card, Square Register and Caviar. The company recently rolled out third-party integrations to augment seller base of Square for Restaurants service.Zacks RankCurrently, PayPal and Square carry a Zacks Rank #2 (Buy) while Alphabet, Apple and Amazon carry a Zacks Rank #3 (Hold). You can seethe complete list of today's Zacks #1 Rank (Strong Buy) stocks here.More Stock News: This Is Bigger than the iPhone!It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.Click here for the 6 trades >>
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 reportAmazon.com, Inc. (AMZN) : Free Stock Analysis ReportAlphabet Inc. (GOOGL) : Free Stock Analysis ReportPayPal Holdings, Inc. (PYPL) : Free Stock Analysis ReportSquare, Inc. (SQ) : Free Stock Analysis ReportApple Inc. (AAPL) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research |
Here's Why We Think Packaging of America (NYSE:PKG) Is Well Worth Watching
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For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it completely lacks a track record of revenue and profit. And in their study titledWho Falls Prey to the Wolf of Wall Street?'Leuz et. al. found that it is 'quite common' for investors to lose money by buying into 'pump and dump' schemes.
So if you're like me, you might be more interested in profitable, growing companies, likePackaging of America(NYSE:PKG). Even if the shares are fully valued today, most capitalists would recognize its profits as the demonstration of steady value generation. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed.
See our latest analysis for Packaging of America
If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS). That means EPS growth is considered a real positive by most successful long-term investors. It certainly is nice to see that Packaging of America has managed to grow EPS by 21% per year over three years. If the company can sustain that sort of growth, we'd expect shareholders to come away winners.
I like to take a look at earnings before interest and (EBIT) tax margins, as well as revenue growth, to get another take on the quality of the company's growth. Packaging of America maintained stable EBIT margins over the last year, all while growing revenue 7.0% to US$7.1b. 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.
The trick, as an investor, is to find companies that aregoing toperform well in the future, not just in the past. To that end, right now and today, you can checkour visualization of consensus analyst forecasts for future Packaging of America EPS100% free.
Since Packaging of America has a market capitalization of US$8.9b, we wouldn't expect insiders to hold a large percentage of shares. But we do take comfort from the fact that they are investors in the company. Indeed, they have a glittering mountain of wealth invested in it, currently valued at US$126m. This suggests to me that leadership will be very mindful of shareholders' interests when making decisions!
You can't deny that Packaging of America has grown its earnings per share at a very impressive rate. That's attractive. Further, the high level of insider buying impresses me, and suggests that I'm not the only one who appreciates the EPS growth. So this is very likely the kind of business that I like to spend time researching, with a view to discerning its true value. Of course, just because Packaging of America 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. |
U.S. Supreme Court takes up insurers' $12 billion Obamacare dispute
WASHINGTON, June 24 (Reuters) - The U.S. Supreme Court on Monday agreed to decide whether the federal government must pay insurers $12 billion under an Obamacare program aimed at encouraging them to cover previously uninsured people after the healthcare law was enacted in 2010. The justices will hear an appeal by a group of insurers of a lower court ruling that Congress had suspended the government's obligation to make the payments. The insurers have argued that the ruling would allow the government to pull a "bait-and-switch" and withhold money they were promised. (Reporting by Lawrence Hurley; Editing by Will Dunham) |
Better Contrarian Play: GoPro or Fitbit?
GoPro(NASDAQ: GPRO)andFitbit(NYSE: FIT)both burned a lot of investors. GoPro, which popularized action cameras, went public in 2014 at $24 and surged to the low $90s over the following months, but now it trades at about $6 per share. Fitbit, the first mover in fitness trackers, went public at $20 per share in 2015 and soared to the high $40s a few months later. It's worth about $4 per share today.
GoPro and Fitbit created new markets, but cheaper competitors easily copied their core products. Upgrade cycles were painfully slow, and new technologies created further challenges -- such as improved smartphone cameras and full-featured smartwatches.
Image source: GoPro.
GoPro and Fitbit both expanded their businesses into new markets to offset those declines. GoPro launched virtual-reality and 360-degree cameras, while Fitbit sold beefier trackers and smartwatches. Both companies also expanded their digital ecosystems with subscription services to lock in customers.
Many investors left GoPro and Fitbit for dead, but both stocks now trade at less than their sales estimates for the current year. So is either stock a viable contrarian play for value-seeking investors?
GoPro's revenue fell 3% annually in 2018, compared with flat growth in 2017 and a 27% decline in 2016. That growth looks dismal, but its revenue surged 20% annually during the first quarter.
GoPro mainly attributed that growth to rising demand for its HERO7 Black camera (which generated 90% of its sales), higher average selling prices, annual market share gains in the U.S. action camera market, and robust growth in Asia. Its number of GoPro Plus subscribers also grew 50% annually to 220,000.
GoPro's adjusted gross margin also expanded almost 10 percentage points annually to 34.2%, as it reduced its operating expenses 16%. Those improvements narrowed its adjusted net loss from $47.4 million to just $10.2 million.
For the full year, GoPro expects its revenue to rise 7%-10%, with adjusted earnings of $0.25-$0.45 per share -- compared with a loss of $0.23 per share in 2018. It expects that recovery to be supported by higher margins from GoPro Plus, higher camera shipments, and stable prices -- which indicates that the camera maker isn't worried about the competition.
Simply put, GoPro right-sized its business and focused on dominating its core niche market instead of continuing to clumsily expand into adjacent markets such as drones -- an idea that flopped with thedisastrous launchof the Karma in 2016. It's also wisely locking in those customers with GoPro Plus to mitigate the impact of longer upgrade cycles.
Image source: Fitbit.
Fitbit's revenue fell 6% in 2018, compared with its 26% decline in 2017 and 17% growth in 2016. Fitbit's revenue rose 10% annually during the first quarter, thanks to higher shipments of its new Charge 3, Inspire, Inspire HR, and Versa Lite devices -- which accounted for over two-thirds of its sales.
However, its average ASP still fell and its adjusted gross margin plunged from 47.1% to 34.2% -- indicating that it was still struggling to stand out in the crowded wearables market. Fitbit reduced its operating expenses 13% annually, but its adjusted net loss narrowed only slightly, from $41 million to $38.1 million.
Fitbit expects its full-year revenue to rise 1%-4%, but it still expects its average selling prices to decline as it tries to grow its "community of active users." In other words, it's willing to sell cheaper devices tofend off rivalsincludingAppleandXiaomi, which both eclipsed the former market leader in annual shipments last year, according to IDC.
Fitbit anticipates an adjusted gross margin of 40% for the year, compared with 40.9% in 2018. However, it expects the growth of its Fitbit Health Solutions software services to be slightly accretive to its gross margin.
Fitbit didn't provide any full-year earnings guidance, but analysts expect an adjusted loss of $0.15 per share, compared with its loss of $0.76 per share in 2018. That outlook indicates that Fitbit isn't doomed, but it faces a tougher uphill battle than GoPro.
I'm not a big fan of either stock. I generally favor long-term investments, and it's hard to tell where GoPro and Fitbit will be in just five years.
If I had to choose one today, I'd stick with GoPro. It faces less competition, since many of its challengers backed out of the market, and it has a clearer path toward profitability. Fitbit's outlook is murkier, and it could struggle to roll with the punches as Apple, Xiaomi, and other companies launch new wearable devices.
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Leo Sunowns shares of Apple. The Motley Fool owns shares of and recommends Apple and Fitbit. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has adisclosure policy. |
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