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How Does Investing In Ayima Group AB (publ) (STO:AYIMA B) Impact The Volatility Of Your Portfolio?
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If you own shares in Ayima Group AB (publ) (STO:AYIMA B) then it's worth thinking about how it contributes to the volatility of your portfolio, overall. In finance, Beta is a measure of volatility. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The second type is the broader market volatility, which you cannot diversify away, since it arises from macroeconomic factors which directly affects all the stocks on the market.
Some stocks are more sensitive to general market forces than others. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. Any stock with a beta of greater than one is considered more volatile than the market, while those with a beta below one are either less volatile or poorly correlated with the market.
View our latest analysis for Ayima Group
Looking at the last five years, Ayima Group has a beta of 1.76. The fact that this is well above 1 indicates that its share price movements have shown sensitivity to overall market volatility. Based on this history, investors should be aware that Ayima Group are likely to rise strongly in times of greed, but sell off in times of fear. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how Ayima Group fares in that regard, below.
Ayima Group is a rather small company. It has a market capitalisation of kr93m, which means it is probably under the radar of most investors. It takes less money to influence the share price of a very small company. This may explain the excess volatility implied by this beta value.
Since Ayima Group has a reasonably high beta, it's worth considering why it is so heavily influenced by broader market sentiment. For example, it might be a high growth stock or have a lot of operating leverage in its business model. In order to fully understand whether AYIMA B is a good investment for you, we also need to consider important company-specific fundamentals such as Ayima Group’s financial health and performance track record. I urge you to continue your research by taking a look at the following:
1. Financial Health: Are AYIMA B’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. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Concerned About ams AG's (VTX:AMS) Historical Volatility?
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Anyone researching ams AG (VTX:AMS) might want to consider the historical volatility of the share price. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first category is company specific volatility. This can be dealt with by limiting your exposure to any particular stock. The other type, which cannot be diversified away, is the volatility of the entire market. Every stock in the market is exposed to this volatility, which is linked to the fact that stocks prices are correlated in an efficient market.
Some stocks 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.
See our latest analysis for ams
Looking at the last five years, ams has a beta of 1.5. The fact that this is well above 1 indicates that its share price movements have shown sensitivity to overall market volatility. Based on this history, investors should be aware that ams are likely to rise strongly in times of greed, but sell off in times of fear. Beta is worth considering, but it's also important to consider whether ams is growing earnings and revenue. You can take a look for yourself, below.
ams is a reasonably big company, with a market capitalisation of CHF2.6b. Most companies this size are actively traded with decent volumes of shares changing hands each day. It has a relatively high beta, suggesting it may be somehow leveraged to macroeconomic conditions. For example, it might be a high growth stock with lots of investors trading the shares. It's notable when large companies to have high beta values, because it usually takes substantial capital flows to move their share prices.
Beta only tells us that the ams share price is sensitive to broader market movements. This could indicate that it is a high growth company, or is heavily influenced by sentiment because it is speculative. Alternatively, it could have operating leverage in its business model. Ultimately, beta is an interesting metric, but there's plenty more to learn. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as ams’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 AMS’s future growth? Take a look at ourfree research report of analyst consensusfor AMS’s outlook.
2. Past Track Record: Has AMS 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 AMS's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how AMS 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. |
Is Allgon AB (publ)'s (STO:ALLG B) 1.8% ROE Worse Than Average?
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Allgon AB (publ) (STO:ALLG B).
Over the last twelve monthsAllgon has recorded a ROE of 1.8%. One way to conceptualize this, is that for each SEK1 of shareholders' equity it has, the company made SEK0.018 in profit.
View our latest analysis for Allgon
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Allgon:
1.8% = kr3.0m ÷ kr305m (Based on the trailing twelve months to March 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all the money paid into the company from shareholders, plus any earnings retained. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the amount earned after tax over the last twelve months. The higher the ROE, the more profit the company is making. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As shown in the graphic below, Allgon has a lower ROE than the average (9.0%) in the Communications industry classification.
Unfortunately, that's sub-optimal. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Nonetheless, it might be wise tocheck if insiders have been selling.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
It's worth noting the significant use of debt by Allgon, leading to its debt to equity ratio of 1.07. With a fairly low ROE, and significant use of debt, it's hard to get excited about this business at the moment. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it.
Return on equity is one way we can compare the business quality of different companies. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREEvisualization of analyst forecasts for the company.
But note:Allgon 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. |
Is AMA Group Limited (ASX:AMA) A Smart Choice For Dividend Investors?
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Is AMA Group Limited (ASX:AMA) a good dividend stock? How would you know? Dividend paying companies with growing earnings can be highly rewarding in the long term. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful.
A slim 1.8% yield is hard to get excited about, but the long payment history is respectable. At the right price, or with strong growth opportunities, AMA Group could have potential. Remember though, due to the recent spike in its share price, AMA Group's yield will look lower, even though the market may now be factoring in an improvement in its long-term prospects. Before you buy any stock for its dividend however, you should always remember Warren Buffett's two rules: 1) Don't lose money, and 2) Remember rule #1. We'll run through some checks below to help with this.
Explore this interactive chart for our latest analysis on AMA Group!
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. AMA Group paid out 76% of its profit as dividends, over the trailing twelve month period. Paying out a majority of its earnings limits the amount that can be reinvested in the business. This may indicate a commitment to paying a dividend, or a dearth of investment opportunities.
In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. AMA Group paid out 68% of its cash flow as dividends last year, which is within a reasonable range for the average corporation. It's positive to see that AMA Group's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
We update our data on AMA Group every 24 hours, so you can always getour latest analysis of its financial health, here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. AMA Group has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. The dividend has been cut by more than 20% on at least one occasion historically. During the past ten-year period, the first annual payment was AU$0.032 in 2009, compared to AU$0.025 last year. The dividend has shrunk at around 2.4% a year during that period. AMA Group's dividend has been cut sharply at least once, so it hasn't fallen by 2.4% every year, but this is a decent approximation of the long term change.
A shrinking dividend over a ten-year period is not ideal, and we'd be concerned about investing in a dividend stock that lacks a solid record of growing dividends per share.
With a relatively unstable dividend, it's even more important to evaluate if earnings per share (EPS) are growing - it's not worth taking the risk on a dividend getting cut, unless you might be rewarded with larger dividends in future. AMA Group has grown its earnings per share at 6.2% per annum over the past five years. Past earnings growth has been decent, but unless this is one of those rare businesses that can grow without additional capital investment or marketing spend, we'd generally expect the higher payout ratio to limit its future growth prospects.
We'd also point out that AMA Group issued a meaningful number of new shares in the past year. Regularly issuing new shares can be detrimental - it's hard to grow dividends per share when new shares are regularly being created.
Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. First, we think AMA Group is paying out an acceptable percentage of its cashflow and profit. Second, earnings growth has been ordinary, and its history of dividend payments is chequered - having cut its dividend at least once in the past. In sum, we find it hard to get excited about AMA Group from a dividend perspective. It's not that we think it's a bad business; just that there are other companies that perform better on these criteria.
Earnings growth generally bodes well for the future value of company dividend payments. See if the 4 AMA Group analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company.
Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why AEW UK REIT plc (LON:AEWU) Looks Like A Quality Company
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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 AEW UK REIT plc (LON:AEWU), by way of a worked example.
AEW UK REIT has a ROE of 10%, based on the last twelve months. That means that for every £1 worth of shareholders' equity, it generated £0.10 in profit.
See our latest analysis for AEW UK REIT
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for AEW UK REIT:
10% = UK£16m ÷ UK£149m (Based on the trailing twelve months to March 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the profit over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal,investors should like a high ROE. That means ROE can be used to compare two businesses.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. 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, AEW UK REIT has a better ROE than the average (7.7%) in the REITs industry.
That's clearly a positive. 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 issuing shares, retained earnings, or debt. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
AEW UK REIT has a debt to equity ratio of 0.34, which is far from excessive. Its very respectable ROE, combined with only modest debt, suggests the business is in good shape. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt.
But when a business is high quality, the market often bids it up to a price that reflects this. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Is AEW UK REIT plc's (LON:AEWU) 10% ROE Better Than Average?
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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 AEW UK REIT plc (LON:AEWU), by way of a worked example.
Our data showsAEW UK REIT has a return on equity of 10%for the last year. That means that for every £1 worth of shareholders' equity, it generated £0.10 in profit.
View our latest analysis for AEW UK REIT
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for AEW UK REIT:
10% = UK£16m ÷ UK£149m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the profit 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. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. Pleasingly, AEW UK REIT has a superior ROE than the average (7.7%) company in the REITs industry.
That's clearly a positive. We think a high ROE, alone, is usually enough to justify further research into a company. One data point to check is ifinsiders have bought shares recently.
Virtually all companies need money to invest in the business, to grow profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt 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.
Although AEW UK REIT does use debt, its debt to equity ratio of 0.34 is still low. The combination of modest debt and a very respectable ROE suggests this is a business worth watching. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities.
Return on equity is useful for comparing the quality of different businesses. In my book the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. 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. |
Can China New Energy Limited's (LON:CNEL) ROE Continue To Surpass The Industry Average?
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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 China New Energy Limited (LON:CNEL), by way of a worked example.
Our data showsChina New Energy has a return on equity of 65%for the last year. That means that for every £1 worth of shareholders' equity, it generated £0.65 in profit.
See our latest analysis for China New Energy
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for China New Energy:
65% = CN¥46m ÷ CN¥71m (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. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. Pleasingly, China New Energy has a superior ROE than the average (17%) company in the Construction industry.
That is a good sign. We think a high ROE, alone, is usually enough to justify further research into a company. One data point to check is ifinsiders have bought shares recently.
Virtually all companies need money to invest in the business, to grow profits. That cash can come from issuing shares, retained earnings, or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the use of debt will improve the returns, but will not change the equity. That will make the ROE look better than if no debt was used.
China New Energy has a debt to equity ratio of just 0.092, which is very low. Its ROE is very impressive, and given only modest debt, this suggests the business is high quality. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is useful for comparing the quality of different businesses. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. Check the past profit growth by China New Energy by looking at thisvisualization of past earnings, revenue and cash flow.
If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Forget retail property — it's all about investing in logistics space
Warehouses are money earners as UK reels under Brexit uncertainty. Photo: Getty There has been a visible decline in the health of Britain’s high streets over the past few years. Fewer shoppers are spending money at shops, instead using the internet to buy goods. Online sales count for around a fifth of all retail sales in the UK, according to the Office for National Statistics, a proportion that is growing every year. Ten years ago, online made up just one-twentieth of all retail sales. The success of digital businesses such as Amazon, ASOS, and Ocado are testaments to this fundamental shift in the retail market. As a result, demand for retail store space is dwindling. Retailers are pulling out of high streets and town centres, limiting their physical presence to all-encompassing destination hubs, such as the Westfield retail and leisure complexes. As Deloitte said in a recent report on retail sector trends, there will be “fewer, better stores” in the future. But that does not mean you should ignore the retail sector of commercial property. You might just need to rethink and look forward instead. With the advent and rapid growth of internet shopping has come an explosion in demand for logistics space. READ MORE: Self-build revolution: The pros and cons of building your own home from scratch These businesses need vast warehouses and distribution centres to handle all the retail sales coming from online. To deliver everywhere, and deliver fast, these logistics centres are required all over Britain. As online shopping demand grows, so will the need for this logistics space, creating opportunity for investors. One advantage for investors is that e-commerce firms are increasingly reliant on high-tech warehousing and distribution centres to manage the retail demand. Because of all this investment-heavy complex state-of-the-art machinery and technology, logistics tenants now tend to take longer leases. “They need modern, functional, and efficient buildings and that is very capital intensive,” Andrew Allen, global head of investment research, real estate, at Aberdeen Standard Investments, told What Investment last year. Story continues “It means that the occupiers are much more wedded to their warehouses for a longer period of time,” Allen said. “In Europe, it means we are seeing leases lengthening from three, five, or six years to much longer duration, more in line with how things have been seen in the UK.” Moreover, the logistics market has held up well despite the recent political turmoil in Britain over Brexit, and the ongoing uncertainty for business over if and when the country will leave the European Union. READ MORE: 5 reasons why renting is better than buying a property The property firm Savills said in a recent report that investment volumes for distribution warehouses came in at £3.55bn for 2018, a "marginal" decline over the year — a figure it described as “encouraging.” "The three-year rolling average has now reached a new height of £3.32bn, the highest level ever recorded and up from £2.1bn just five years ago,” Savills said. "Relative to other sectors, which saw significantly reduced transaction levels, volumes, and notably pricing, logistics proved stubbornly resilient despite growing geopolitical and economic uncertainty." Mike Gibson, head of UK research at property firm CBRE, is optimistic about the market's future. "The e-commerce revolution will continue to drive sustained demand for industrial and logistics space in 2019, with demand for bigger 'big boxes' increasing fastest," Gibson wrote in his outlook for the year. "'No deal' Brexit concerns have not yet been a major force in driving demand, and speculative development is starting to address supply-side concerns. "Investment demand remains very strong, but investors will need to keep an eye on innovations in logistics technology." |
Jewelry startup mints fresh funding in pursuit of new gold standard
Two women decided to catch up over brunch on a fine day in New York, and, after noticing that one of them had a green mark around her finger from the ring she wore that day, the conversation turned to lamenting the lack of accessibility to affordable, quality gold jewelry.That discussion became one of the main reasons Sophie Kahn and Bouchra Ezzahraoui (pictured, with Ezzahraoui at left) were inspired to foundAUratein 2015. The New York-based direct-to-consumer brand, which launched in 2017, offers ethically sourced luxury jewelry without the retail markup found at traditional stores. The business announced Wednesday that it has raised a $13 million Series A led by BlueCrest Capital, with participation from Point King Capital,Arab Angel Fundand Drake Management. AUrate plans to use the funding in part to focus on a styling box program introduced last year that lets customers order pieces for at-home try-on.Ezzahraoui and Kahn, who first met at Princeton University a decade ago, were working forGoldman Sachsand Marc Jacobs, respectively, when they dreamed up the company. They realized it made sense to combine their fashion and finance backgrounds to promote AUrate from a side hustle to a full-blown brand. The co-founders discovered that two keys to their success were customizing their jewelry and using social media to reach a wider audience."We decided to solve the problem ourselves using consumer pain points as our roadmap—the highest quality materials, an ethical supply chain [and] incorporating tangible giving with each purchase, without the traditional markups," Ezzahraoui told PitchBook.Since life is too short to wear boring jewelry, customization has been their biggest takeaway thus far. Rather than limit the options for potential customers, AUrate focuses on creating room for made-to-order pieces. The company makes all of its jewelry in New York and heavily relies on social media to boost its direct-to-consumer model, especially Instagram, where it has amassed nearly 100,000 followers.Kahn told PitchBook that social media platforms help create an open dialogue to understand if a piece isn't quite right, or when a product could use an extra diamond or a new variation for future collections. It's no surprise that social media has revolutionized marketing strategies of brands to capture the attention of target audiences and potential customers. According to Instagram data from January, one-third of the most-viewed stories come from businesses, and earlier data noted that as of 2017, one in five stories earned a direct message from its viewers.AUrate is well-poised to capitalize on a growing sector. The global gems and jewelry market is projected to grow at a rate of 5.5% from 2018 to 2023, according to a report by Research and Markets. There has been an increase in the number of digital buyers, as well as the disposable income of millennials over the years, making them a key target audience for direct-to-consumer jewelry brands.Given the potential, it makes sense that multiple startups are vying for the market opportunity. Toronto-basedMejuri, for example, raised $23 million in a round led byNEAin April. Co-founded by current CEO Noura Sakkijha, Mejuri offers handcrafted fine jewelry and has around 475,000 followers on Instagram. Similar to AUrate's emphasis on customization, Mejuri also looks to carve out a unique space for itself; instead of large seasonal releases, it relies on a 52-week "drop model" to introduce new products every week.Two other companies that have tapped into the broader global market includeSokoandBluestone. Soko connects with independent artisans in Africa to source handmade jewelry and accessories made from less-conventional materials like brass. Backed by investors includingNovaStar VenturesandGrowthAfrica, the San Francisco-based business was valued at roughly $14 million in 2016. It sells its jewelry in more than 60 countries and has partnered with retail brands such asNordstrom,GoopandZolando. And India-based Bluestone, which also offers a fine jewelry platform, reportedly raised $70 million from investors includingAcceland IvyCap Ventures in 2016.Featured image via AUrate
Related read:The changing face of beauty brands in an Instagram-obsessed world |
Email etiquette: why virtual body language matters
Writing the same way you speak is becoming increasingly common. Photo: Getty Even when we’re sitting next to someone in the office, many of us still rely on technology to communicate, whether it’s email, Slack, or social media. And with a growing number of people working remotely, the way we interact with each other virtually is more important than ever. You can tell quite a lot from the way someone writes in a message or email. Humour, aggression, and more can be a big giveaway. We might not be speaking to them in person, but we can still read their digital body language — although it can be more difficult. “The increasing amount of digital communication that we have at our fingertips may mean we are more inclined to contact our friends by a simple written message on WhatsApp or Facebook message rather than speaking to them on the phone,” Alan Price, HR expert and operations director at Peninsula Group, told Yahoo Finance UK. “We might also include a few emoji’s to emphasise our feelings to the recipient. That’s fine when making arrangements to meet at the pub at the weekend, but is it appropriate when sending over an excel spreadsheet or sales report to a colleague?” Sometimes, an emoji is harmless in a work email or message, but it can depend on the context. For many people, a smiling emoji at the end of critical email is extremely passive aggressive — and is likely to infuriate the receiver. Writing the same way you speak is becoming increasingly common as people message friends and family on WhatsApp, Facebook Messenger, and other apps. This can make it easier to read someone’s mood — what you see is what you get. READ MORE: Why women are penalised for getting angry at work Shorter, more abrupt text — particularly over email — usually indicates someone is unhappy or angry, unless you know for a fact that’s the person’s normal style. This isn’t the same as messaging over Slack or other instant messaging apps, however, where we’re more likely to keep our messages short and succinct. However, the use of abbreviations can seem self-centred to some. A quick “tks” may seem harmless, but it often comes from the colleague or boss who is rushed and overworked — and thus can come off as far too important to add a few extra letters to a word. Story continues Even the use of full stops in messages can indicate anger or dissatisfaction. It may seem far-fetched, but a 2015 study found that putting a full stop at the end of a sentence while texting makes you seem insincere . This is because punctuation influences the perceived meaning of text messages when important social and contextual cues are missing, according to the study’s research leader Celia Klin. “Texting is lacking many of the social cues used in actual face-to-face conversations. When speaking, people easily convey social and emotional information with eye gaze, facial expressions, tone of voice, pauses, and so on,” Klin said. Texters rely on signals they have available to them. Photo: Getty “People obviously can't use these mechanisms when they are texting. Thus, it makes sense that texters rely on what they have available to them — emoticons, deliberate misspellings that mimic speech sounds, and, according to our data, punctuation.” Social habits can easily spill over into work communication but it’s up to employers to set out their expectations on maintaining professionalism on email etiquette, according to Price. It can pay to be cautious. “Many employers deploy standard email signatures to remove the personal touch and probably for good reason. Jokey sign offs, risqué banter, and kisses should be avoided in case they are not received well by the reader,” he said. “All it takes is for one employee to consider the email to be offensive and if the content is connected to the reader’s gender, for example, you’ve got the makings of a harassment claim where employers would have to defend themselves, and the actions of its employee, at employment tribunal.” READ MORE: Should we all be working outdoors? Whether we formally sign off an email or not also depends on whether we’re talking to a colleague or a client. “‘Cheers’ may be acceptable when thanking a team member for sending a document over but not when replying to a client or customer, when something more business-like is likely to be expected,” Price said. “In addition, as a manager, do you want to be accused of favouritism if you use a smiley face emoji to one team member on the end of the email but not another? Employers can address these issues in a wider email usage policy; it’s best to set the stall out from the beginning rather than having to try to pull the reins back in when something goes wrong.” |
What Does Electrocomponents plc's (LON:ECM) Share Price Indicate?
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Electrocomponents plc (LON:ECM), which is in the electronic business, and is based in United Kingdom, saw a double-digit share price rise of over 10% in the past couple of months on the LSE. With many analysts covering the mid-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Let’s examine Electrocomponents’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
Check out our latest analysis for Electrocomponents
According to my valuation model, Electrocomponents seems to be fairly priced at around 2.9% below my intrinsic value, which means if you buy Electrocomponents today, you’d be paying a fair price for it. And if you believe the company’s true value is £6.33, then there isn’t much room for the share price grow beyond what it’s currently trading. In addition to this, Electrocomponents has a low beta, which suggests its share price is less volatile than the wider 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. Electrocomponents’s earnings over the next few years are expected to increase by 36%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
Are you a shareholder?ECM’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor?If you’ve been keeping tabs on ECM, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Electrocomponents. You can find everything you need to know about Electrocomponents inthe latest infographic research report. If you are no longer interested in Electrocomponents, 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. |
StockBeat: Markets Tread Water as Trade Hope Balances Powell Effect
By Geoffrey Smith
Investing.com -- Europe’s stock markets are treading water after early trading on Wednesday, with one eye already on the weekend’s G20 summit meeting that will show how much, or how little, the U.S. and China care about ending their trade dispute.
A report by Bloomberg that the U.S. is willing to cancel tariffs on $300 billion worth of previously unaffected imports from China, which are scheduled to come into force next week, has eased concerns about an immediate escalation of the dispute, but has not been enough to encourage much new risk-taking ahead of the weekend.
By the same token, markets have read mixed messages into a speech by Federal Reserve Chairman Jerome Powell after the European close on Tuesday, in which Powell defended the principle of central bank independence – a sign of his unwillingness to take orders from President Trump on where interest rates should be set – but otherwise reaffirmed the Fed’s bias toward easing if the economy shows any further sign of slowing.
By 4:45 AM ET (0845 GMT), the main indexes were mixed, ranging from a 0.3% drop in Switzerland a to a similar-sized rise in Spain. The benchmark Euro Stoxx 600 was down 0.2% at 382.64, on course for a fourth straight day of – admittedly relatively modest – losses.
Among the notable blue-chip movements, industrial group Thyssenkrupp (DE:TKAG) was up over 5% on a report in the German newsletter Platow-Brief that Finland's KONE (HE:KNEBV) is preparing a bid for its elevator business, a deal that would unlock much of the value in the group.
Tobacco stocks were relatively unmoved by news that San Francisco had become the first U.S. city to ban vaping, a move that, if replicated elsewhere across the U.S., could seriously dent demand for the industry’s great hope for the future. British American Tobacco (LON:BATS) was down 0.4%, but Imperial Brands (LON:IMB) was up 0.9%.
And Europe’s oil and gas stocks were broadly higher after theAmerican Petroleum Institutereported a large draw in U.S. crude inventories last week, adding to indications that oil prices may be finding a floor after a steep drop in the second quarter. BP (LON:BP) and Royal Dutch Shell (AS:RDSa) were both up 0.5%, while Spain's Repsol (MC:REP) led the way with a 1.0% gain.
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China Mobile first to deploy Nokia's new Massive MIMO solution, accelerating the transition to 5G services
Press Release
• China Mobile instrumental in development with Nokia of world-first 320W mMIMO Adaptive Antenna (MAA)
• Nokia AirScale MAA solution helps solve the operator`s challenges as it concurrently delivers 4G and 5G services, and control its costs as it evolves to 5G
26 June 2019
Mobile World Congress, Shanghai, China - Nokia has announced that China Mobile (CMCC) will adopt its new AirScale mMIMO Adaptive Antenna (MAA), created specifically for the massive bandwidth and coverage requirements of the Chinese market as it transitions to 5G. Building on CMCC`s leadership in the 2.6 GHz 5G ecosystem, the Nokia MAA ensures that, as one of the world`s biggest operators, CMCC can more efficiently allocate network resources between 4G and 5G users and address thedemand for high-bandwidth 5G use cases.
As a 5G pioneer, CMCC already leads in the development of 2.6 GHz mobile services in the Chinese market. But it requires even greater bandwidth, coverage and flexibility to ensure it can deliver the most optimized 5G experience across its markets.
Nokia worked directly with the operator to create the new version of the MAA which - at 320W - is at least 80W greater than the closest MAA on the market. CMCC is now able to support 4G and 5G in concurrent mode in the 2.6 GHz frequency band, which helps CMCC to flexibly balance the two technologies. In addition, the 160 MHz, 320W version ensures CMCC has better coverage and capacity, which helps to reduce CAPEX as the operator transitions its subscribers to 5G.
Mark Atkinson, Head of 5G and Small Cells business at Nokia, said:"Nokia has been operating in China for 40 years, and we are pleased to have this opportunity to work so closely with an industry leader like China Mobile. The development of the AirScale MAA with its industry-first 320W output is the direct result of input from the China Mobile team on what they needed to speed the deployment of 5G services to their customers. We look forward to continuing to work with CMCC as its 5G plans evolve."
The MAA uses 64 transmit and 64 receive antenna elements, which combined deliver a total of 320W output power, the highest of any MAA in the industry.
Nokia currently has 43 commercial 5G deals with operators around the world and is involved in more than 100 5G-related customer engagements. During Mobile World Congress in Barcelona, Nokia won the coveted 5G Leadership Award for demonstrating leadership across the 5G ecosystem - through innovation, collaborative R&D, a wide range of industry partnerships and significant contribution across both the technical and business aspects of this technology.
About NokiaWe create the technology to connect the world. We develop and deliver the industry`s only end-to-end portfolio of network equipment, software, services and licensing that is available globally. Our customers include communications service providers whose combined networks support 6.1 billion subscriptions, as well as enterprises in the private and public sector that use our network portfolio to increase productivity and enrich lives.
Through our research teams, including the world-renowned Nokia Bell Labs, we are leading the world to adopt end-to-end 5G networks that are faster, more secure and capable of revolutionizing lives, economies and societies. Nokia adheres to the highest ethical business standards as we create technology with social purpose, quality and integrity.www.nokia.com
Media Inquiries:NokiaCommunicationsPhone: +358 10 448 4900Email:press.services@nokia.com
This announcement is distributed by West Corporation on behalf of West Corporation clients.The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.Source: NOKIA via GlobeNewswireHUG#2246612 |
Electrocomponents plc (LON:ECM): What Are The Future Prospects?
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Looking at Electrocomponents plc's (LON:ECM) earnings update on 31 March 2019, analysts seem cautiously bearish, with profits predicted to rise by 14% next year relative to the higher past 5-year average growth rate of 24%. With trailing-twelve-month net income at current levels of UK£148m, we should see this rise to UK£169m in 2020. Below is a brief commentary around Electrocomponents's earnings outlook going forward, which may give you a sense of market sentiment for the company. Readers that are interested in understanding the company beyond these figures shouldresearch its fundamentals here.
See our latest analysis for Electrocomponents
The longer term view from the 10 analysts covering ECM is one of positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of ECM's earnings growth over these next few years.
By 2022, ECM's earnings should reach UK£201m, from current levels of UK£148m, resulting in an annual growth rate of 9.8%. This leads to an EPS of £0.45 in the final year of projections relative to the current EPS of £0.33. Margins are currently sitting at 7.9%, which is expected to expand to 9.3% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Electrocomponents, I've compiled three pertinent aspects you should look at:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is Electrocomponents 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 Electrocomponents is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of Electrocomponents? 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. |
Here's How P/E Ratios Can Help Us Understand Taylor Wimpey plc (LON:TW.)
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This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Taylor Wimpey plc's (LON:TW.), to help you decide if the stock is worth further research.Taylor Wimpey has a P/E ratio of 7.76, based on the last twelve months. That means that at current prices, buyers pay £7.76 for every £1 in trailing yearly profits.
Check out our latest analysis for Taylor Wimpey
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for Taylor Wimpey:
P/E of 7.76 = £1.56 ÷ £0.20 (Based on the year to December 2018.)
A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E.
Probably the most important factor in determining what P/E a company trades on is the earnings growth. Earnings growth means that in the future the 'E' will be higher. Therefore, even if you pay a high multiple of earnings now, that multiple will become lower in the future. Then, a lower P/E should attract more buyers, pushing the share price up.
Most would be impressed by Taylor Wimpey earnings growth of 18% in the last year. And it has bolstered its earnings per share by 22% per year over the last five years. So one might expect an above average P/E ratio.
The P/E ratio indicates whether the market has higher or lower expectations of a company. If you look at the image below, you can see Taylor Wimpey has a lower P/E than the average (9.8) in the consumer durables industry classification.
Its relatively low P/E ratio indicates that Taylor Wimpey shareholders think it will struggle to do as well as other companies in its industry classification. Many investors like to buy stocks when the market is pessimistic about their prospects. You should delve deeper. I like to checkif company insiders have been buying or selling.
Don't forget that the P/E ratio considers market capitalization. Thus, the metric does not reflect cash or debt held by the company. Hypothetically, a company could reduce its future P/E ratio by spending its cash (or taking on debt) to achieve higher earnings.
Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof).
Taylor Wimpey has net cash of UK£644m. This is fairly high at 13% of its market capitalization. That might mean balance sheet strength is important to the business, but should also help push the P/E a bit higher than it would otherwise be.
Taylor Wimpey has a P/E of 7.8. That's below the average in the GB market, which is 16.3. It grew its EPS nicely over the last year, and the healthy balance sheet implies there is more potential for growth. The relatively low P/E ratio implies the market is pessimistic.
Investors should be looking to buy stocks that the market is wrong about. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock.
Of courseyou might be able to find a better stock than Taylor Wimpey. So you may wish to see thisfreecollection of other companies that have grown earnings strongly.
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. |
Singapore May factory output falls 2.4% year-on-year, misses forecast
SINGAPORE (Reuters) - Singapore's industrial production fell slightly more than expected in May from a year earlier as electronics output continued to drag, data showed on Wednesday.
Manufacturing output declined 2.4% last month from a year earlier, data from the Singapore Economic Development Board showed, compared with a 0.1% rise in April. The median forecast in a Reuters survey predicted a 2.2% contraction.
On a month-on-month and seasonally adjusted basis, industrial production fell 0.7% in May, after a revised 2.1% rise in April. The median forecast was for a fall of 0.8%.
The decline was attributed to a further plunge in electronics output, which fell 10.8% in May in its 6th consecutive monthly decline.
(Reporting by Fathin Ungku; Editing by Subhranshu Sahu) |
Bitcoin Price Parabolic Advance Continues Past $12,000
Bitcoin price has continued its rapid growth and on June 26 it hit $12,000 for the first time in over a year, according toCoin360.
Market visualization courtesy ofCoin360
Bitcoin (BTC) breached the $12,000 level early this morning after mostly trading horizontally in the $3,000-$4,000 range for the first months of the year. Press time bitcoin is trading at over $12500, after having increased its value 11% over the last 24 hours.
Bitcoin 1-year price chart. Source:Coin360
As Cointelegraphreportedat the time, one June 22 BTC crossed the $11,000 line in under 24 hours after breaking $10,000. Earlier this week professional trader Peter Brandt also tweeted that bitcoin’s price is currently taking aim at $100,000 target. According to him, bitcoin is currently on its fourth parabolic growth phase, and “is a market like no other.”
The founder and CEO of Digital Currency Grouparguedearlier this month that it “looks like, perhaps, we are coming out of a crypto winter and we’ve entered a crypto spring,” in an interview with Bloomberg.
Also on June 22, Ethereum (ETH)hitits 10 months high after on June 21news brokethat Grayscale’s Ethereum-based security, Grayscale Ethereum Trust (ETHE), is now available for trading onOTCMarkets.
• Bitcoin Breaks $13,000 As Rally Continues
• 6 Surprising Takeaways From Bitcoin’s 2019 Bull Run
• Genesis Capital: Institutional Activity in Crypto Up 300% in 12 Months
• Bitcoin Market Dominance Climbs to Over 60% - Highest in Over 2 Years |
Should You Consider HOCHDORF Holding AG (VTX:HOCN)?
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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on HOCHDORF Holding AG (VTX:HOCN) due to its excellent fundamentals in more than one area. HOCN is a notable dividend-paying company that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at thereport on HOCHDORF Holding here.
HOCN's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is a key determinant of the company’s health. Debt funding requires timely payments on interest to lenders. HOCN’s earnings sufficiently covered its interest in the prior year, which indicates there’s low risk associated with the company not being able to meet these key expenses.
HOCN’s reputation for being one of the best dividend payers in the market is supported by the fact that it has been steadily growing its dividend payments over the past ten years and currently is one of the top yielding companies on the markets, at 3.8%.
For HOCHDORF Holding, I've compiled three relevant factors you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for HOCN’s future growth? Take a look at ourfree research report of analyst consensusfor HOCN’s outlook.
2. Historical Performance: What has HOCN's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HOCN? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Does The Data Make Hufvudstaden AB (publ) (STO:HUFV A) An Attractive Investment?
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Hufvudstaden AB (publ) (STO:HUFV A) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of HUFV A, it is a highly-regarded dividend payer with a an impressive track record of delivering benchmark-beating performance. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, read the fullreport on Hufvudstaden here.
In the previous year, HUFV A has ramped up its bottom line by 27%, with its latest earnings level surpassing its average level over the last five years. Not only did HUFV A outperformed its past performance, its growth also exceeded the Real Estate industry expansion, which generated a 13% earnings growth. This is what investors like to see!
Income investors would also be happy to know that HUFV A is a great dividend company, with a current yield standing at 2.2%. HUFV A has also been regularly increasing its dividend payments to shareholders over the past decade.
For Hufvudstaden, I've compiled three key aspects you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for HUFV A’s future growth? Take a look at ourfree research report of analyst consensusfor HUFV A’s outlook.
2. Financial Health: Are HUFV A’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HUFV A? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Fans cheer on Manny Machado in his Baltimore homecoming
BALTIMORE — It was while answering a question about his trade to the Los Angeles Dodgers that Manny Machado , who returned to Camden Yards as a San Diego Padre on Tuesday, made clear just how much his time in Baltimore had meant to him. “They just ship you away and you’re going somewhere else, across the country, trying to meet new faces, new everyone. It’s hard,” Machado said during a pregame news conference. Earlier this week, Machado talked to The Athletic about being disappointed in how the Orioles’ front office handled that trade in his final year before free agency — letting him sweat out the All-Star Game suspecting he had already been dealt. But Tuesday’s remarks felt less like he was griping about old grievances and more like a moment of vulnerability about how difficult it had been to leave his home of seven years and the organization that originally drafted him. Machado only stayed in LA for half a season, and the Orioles he encounters this week are led by a different regime than the one that traded him. What remains is a sort of cognitive dissonance between what is the “same” and what is “different.” Repeatedly over the course of the 15 minutes that he addressed the media, Machado seemed to genuinely marvel at how things that were once familiar had been rendered meaningfully foreign by moves both big — across the country — and small — down the hall in the bowels of Camden Yards. Things that are the same in Machado’s telling: clubhouses, doors, faces in the stands, the route from the airport to the stadium, the way his young team now feels compared to the young team he debuted with in 2012. Things that are different: clubhouses, doors, sleeping in a hotel instead of your own home, his role on that young team as the veteran presence — like Nick Markakis and Adam Jones had been to him — to the rookie, Fernando Tatis Jr . Former Baltimore Orioles star Manny Machado returned to Oriole Park at Camden Yards on Tuesday night. (Getty Images) Something else that is inexplicably different: This day, his first game back in nearly a year. “Honestly I was more excited yesterday than I am today. I’m a little nervous today to come out here,” Machado said. “I’m never nervous, I know! I don’t know. I guess it’s just a weird nervous. It’s just different.” Story continues Part of that was not knowing how the fans would react. “He made some huge contributions to the Orioles franchise for many years and gave the fans a lot to cheer about for a long time,” Mark Trumbo said before the game. “I know that we’re excited to see him, and I gotta think the fans are too.” It was never going to be as bad as fellow-free agent Bryce Harper’s acrimonious return to the Washington Nationals as a member of the division-rival Philadelphia Phillies in the first week of the season. And it was never going to be quite as laudatory as Albert Pujols ’ St. Louis swan song eight years after he left as an MVP candidate. But, to Baltimore’s credit as well as Machado’s, it was closer to the latter than the former. The fans came early and they brought signs. “Welcome Home, Manny,” they said with poster board and a tribute video and in the throngs that gathered to watch batting practice. Machado smiled and waved and signed shirts, adding a note that said: “Sky’s the limit.” “He doesn’t always get a great reception in other cities; he gets tough receptions a lot of times, so to see a team that he considers home treat him the way they did today, sure meant a lot to me and I’m sure it meant a lot to him as well,” Padres manager Andy Green said. He was no longer nervous, either. Maybe it wasn’t all that different after all. “That’s the beauty of being a baseball player, once you put on the uniform, everything goes away and you can focus on playing baseball,” Machado said. When the game started, the crowd cheered for every at-bat — giving Machado a long standing ovation when he was announced in the first. He struck out, and Baltimore fans cheered. They cheered again when he hit a home run to lead off the third, his 100th at Camden Yards. And for every other one of his four at-bats and also when he trotted off the field at the end of each inning. “Tells you everything about the fanbase here,” Machado said — and maybe that’s because they don’t have a lot else to cheer for these days. Machado’s Padres handed the Orioles their 57th loss, 8-3, in front of a crowd of 21,644. Baltimore is the worst team in baseball by far. But on a beautiful day at a famed ballpark, fans could at least cheer about the past — and the future. In a stroke of marketing savvy and narrative good fortune colliding, the Orioles hosted a press conference with their newly signed first overall draft pick , Adley Rutschman, on the same day. The 21-year-old, switch-hitting catcher from Oregon State, represents the hope that their last great homegrown talent’s departure ushered in only a few years of utter misery in the standings. As Rutschman took his first round of batting practice on the field that Machado missed so much, his mom, Carol, recalled the most emotional moment of the journey to get to this point. It wasn’t when the scouts started showing up or draft day or even when he officially became an Oriole. It was his last at-bat at Oregon State — a long fly out to center when it felt like time stood still. The crowd cheered, and it makes her tear up just thinking about it. Even if you’re moving on to bigger and better, sometimes moving on is the hardest thing. More from Yahoo Sports: Trump disagrees with Rapinoe not singing the anthem Bucks superstar Antetokounmpo named MVP over Harden Why an emerging receiver can boost the Cowboys’ offense How winning ugly could be a good thing for the USWNT |
Is ITV plc (LON:ITV) A Good Dividend Stock?
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Today we'll take a closer look at ITV plc (LON:ITV) from a dividend investor's perspective. Owning a strong business and reinvesting the dividends is widely seen as an attractive way of growing your wealth. On the other hand, investors have been known to buy a stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations.
In this case, ITV likely looks attractive to investors, given its 7.6% dividend yield and a payment history of over ten years. It would not be a surprise to discover that many investors buy it for the dividends. There are a few simple ways to reduce the risks of buying ITV for its dividend, and we'll go through these below.
Explore this interactive chart for our latest analysis on ITV!
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. ITV paid out 69% of its profit as dividends, over the trailing twelve month period. This is a fairly normal payout ratio among most businesses. It allows a higher dividend to be paid to shareholders, but does limit the capital retained in the business - which could be good or bad.
In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. ITV paid out 92% of its free cash flow last year, which we think is concerning if cash flows do not improve. ITV paid out less in dividends than it reported in profits, but unfortunately it didn't generate enough free cash flow to cover the dividend. Cash is king, as they say, and were ITV to repeatedly pay dividends that aren't well covered by cashflow, we would consider this a warning sign.
Consider gettingour latest analysis on ITV's financial position here.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. ITV has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. Its dividend payments have fallen by 20% or more on at least one occasion over the past ten years. During the past ten-year period, the first annual payment was UK£0.025 in 2009, compared to UK£0.08 last year. This works out to be a compound annual growth rate (CAGR) of approximately 12% a year over that time. ITV's dividend payments have fluctuated, so it hasn't grown 12% every year, but the CAGR is a useful rule of thumb for approximating the historical growth.
So, its dividends have grown at a rapid rate over this time, but payments have been cut in the past. The stock may still be worth considering as part of a diversified dividend portfolio.
Given that the dividend has been cut in the past, we need to check if earnings are growing and if that might lead to stronger dividends in the future. Earnings have grown at around 7.0% a year for the past five years, which is better than seeing them shrink! Earnings per share are growing at an acceptable rate, although the company is paying out more than half of its profits, which we think could constrain its ability to reinvest in its business.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. ITV gets a pass on its dividend payout ratio, but it paid out virtually all of its cash flow as dividends. This may just be a one-off, but we'd keep an eye on this. Unfortunately, earnings growth has also been mediocre, and the company has cut its dividend at least once in the past. Overall, ITV falls short in several key areas here. Unless the investor has strong grounds for an alternative conclusion, we find it hard to get interested in a dividend stock with these characteristics.
Earnings growth generally bodes well for the future value of company dividend payments. See if the 16 ITV analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company.
Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Dixons Carphone plc (LON:DC.) Insiders Increased Their Holdings
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We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares inDixons Carphone plc(LON:DC.).
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, rules govern insider transactions, and certain disclosures are required.
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 Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
View our latest analysis for Dixons Carphone
In the last twelve months, the biggest single purchase by an insider was when Group Chief Executive & Director Alex Baldock bought UK£171k worth of shares at a price of UK£1.14 per share. That implies that an insider found the current price of UK£1.14 per share to be enticing. Of course they may have changed their mind. But this suggests they are optimistic. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider purchases were made at close to current prices.
Happily, we note that in the last year insiders bought 489k shares for a total of UK£556k. Dixons Carphone may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at thisfreelist of companies. (Hint: insiders have been buying them).
It's good to see that Dixons Carphone insiders have made notable investments in the company's shares. In total, insiders bought UK£556k worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Dixons Carphone insiders own 15% of the company, worth about UK£193m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Dixons Carphone. Looks promising! Therefore, you should should definitely take a look at thisFREEreport showing analyst forecasts for Dixons Carphone.
But note:Dixons Carphone 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. |
Bitcoin Cash – ABC, Litecoin and Ripple Daily Analysis – 26/06/19
Bitcoin Cash ABC slipped by 0.63% on Tuesday. Partially reversing a 1.52% gain from Monday, Bitcoin Cash ABC ended the day at $474.23.
A bullish start to the day saw Bitcoin Cash ABC rise to an early intraday high $483.00 before hitting reverse.
Bitcoin Cash ABC came up against the first major resistance level at $482.74 before hitting reverse.
Bearish through the remainder of the morning, Bitcoin Cash ABC slid to a mid-day intraday low $461.08. The reversal saw Bitcoin Cash ABC fall through the first major support level at $466.27 before recovering to $467 levels.
At the time of writing, Bitcoin Cash ABC was up by 2.05% to $483.93. A particularly bullish start to the day saw Bitcoin Cash ABC rally from a morning low $462.00 to a high $495.00 before easing back.
Finding support at the first major support level at $462.54, Bitcoin Cash ABC broke through the first major resistance level at $484.46 and second major resistance level at $494.69.
For the day ahead, a hold above the first major resistance level at $484.46 would support another run at the second major resistance level at $494.69.
Bitcoin Cash ABC would need support from the broader market, however, to take a run at $500 levels.
Failure to hold above the first major resistance level could see Bitcoin Cash ABC hit reverse. A fall through to sub-480 levels would bring $460 levels back into play before any recovery.
Barring a crypto meltdown, Bitcoin Cash ABC should steer clear of the first major support level at $462.54.
Litecoin rose by just 0.13% on Tuesday. Partially reversing a 1.02% fall from Monday, Litecoin ended the day at $135.55.
A bullish start to the day saw Litecoin rise to an early morning high $136.8 before hitting reverse.
Tracking the broader market, Litecoin slid to a mid-day intraday low $129.00. Litecoin fell through the first major support level at $132.71 and second major support level at $130.15.
Finding support in the afternoon, Litecoin managed to recover to $133 levels ahead of a late rally to an intraday high $138.33. Litecoin broke through the first major resistance level at $137.24 before easing back to $135 levels.
At the time of writing, Litecoin was down by 0.3% to $135.15. A mixed start to the day saw Litecoin fall to a morning low $133.62 before striking a high $137.37.
Litecoin left the major support and resistance levels untested early on.
For the day ahead, a hold onto $135 levels through the morning would support a recovery of the early losses. A move through to $137 levels would support a run at the first major resistance level at $139.59.
Failure to hold onto $135 levels through the morning could see Litecoin fall deeper into the red. A pullback through the morning low $133.62 would bring the first major support level at $130.26 into play.
Barring a broad-based crypto sell-off, Litecoin should steer clear of Tuesday’s low $129.00.
Ripple’s XRP fell by 1.81% on Tuesday. Reversing a 0.76% gain from Monday, Ripple’s XRP ended the day at $0.46567.
Bearish through the morning, Ripple’s XRP fell from an early intraday high $0.47778 to a mid-day low $0.45461 before finding support.
Steering clear of the major resistance levels, Ripple’s XRP fell through the first major support level at $0.4567. A brief recovery to $0.47 levels was short-lived, with Ripple’s XRP sliding to a late intraday low $0.45215.
Ripple’s XRP fell back through the first major support level at $0.4567 before recovering to $0.46 levels.
At the time of writing, Ripple’s XRP was up by 2.22% to $0.47601. A mixed start to the day saw Ripple’s XRP fall to a morning low $0.45872 before making a move.
Steering clear of the major support levels, Ripple’s XRP rallied to a morning high $0.48097. The early rally saw Ripple’s XRP break through the first major resistance level at $0.4783.
For the day ahead, a move back through the first major resistance level at $0.4783 would support a run at the second major resistance level at $0.4908.
Ripple’s XRP would need support from the broader market, however, to break out from $0.48 levels.
Failure to move back through the first major resistance level could see Ripple’s XRP give up the morning gains.
A fall through $0.4650 levels would bring the first major support level at $0.4526 into play before any recovery.
Barring a crypto meltdown, Ripple’s XRP should steer clear of sub-$0.45 support levels on the day.
Please let us know what you think in the comments below
Thanks, Bob
Thisarticlewas originally posted on FX Empire
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Does The Data Make Petrofac Limited (LON:PFC) An Attractive Investment?
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Petrofac Limited (LON:PFC) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of PFC, it is a well-regarded dividend payer that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the fullreport on Petrofac here.
PFC is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that PFC has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. PFC's has produced operating cash levels of 0.45x total debt over the past year, which implies that PFC's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
Income investors would also be happy to know that PFC is one of the highest dividend payers in the market, with current dividend yield standing at 7.4%. PFC has also been regularly increasing its dividend payments to shareholders over the past decade.
For Petrofac, I've put together three essential aspects you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for PFC’s future growth? Take a look at ourfree research report of analyst consensusfor PFC’s outlook.
2. Historical Performance: What has PFC's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of PFC? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
An Examination Of Petrofac Limited (LON:PFC)
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Petrofac Limited (LON:PFC) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of PFC, it is a dependable dividend payer that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at thereport on Petrofac here.
PFC is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. PFC's has produced operating cash levels of 0.45x total debt over the past year, which implies that PFC's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
PFC’s reputation for being one of the best dividend payers in the market is supported by the fact that it has been steadily growing its dividend payments over the past ten years and currently is one of the top yielding companies on the markets, at 7.4%.
For Petrofac, I've put together three important aspects you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for PFC’s future growth? Take a look at ourfree research report of analyst consensusfor PFC’s outlook.
2. Historical Performance: What has PFC's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of PFC? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Nifty, Sensex gain for second day; budget in focus
BENGALURU (Reuters) - Indian shares ended higher for a second day on Wednesday, with Vedanta and Power Grid Corp of India leading the gains, while investors awaited cues from the federal budget due next week.
The broader Nifty closed up 0.43% at 11,847.55, while the benchmark Sensex ended 0.4% higher at 39,592.08.
Vedanta closed 4.4% higher, while Power Grid Corp ended up 4%.
(Reporting by Krishna V Kurup in Bengaluru; editing by Gopakumar Warrier) |
YHI International Limited (SGX:BPF): A Fundamentally Attractive Investment
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I've been keeping an eye on YHI International Limited (SGX:BPF) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe BPF has a lot to offer. Basically, it is a highly-regarded dividend-paying company that has been able to sustain great financial health over the past. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at thereport on YHI International here.
BPF's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that BPF manages its cash and cost levels well, which is an important determinant of the company’s health. BPF appears to have made good use of debt, producing operating cash levels of 0.32x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
BPF’s reputation for being one of the best dividend payers in the market is supported by the fact that it has been steadily growing its dividend payments over the past ten years and currently is one of the top yielding companies on the markets, at 6.9%.
For YHI International, I've put together three fundamental factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for BPF’s future growth? Take a look at ourfree research report of analyst consensusfor BPF’s outlook.
2. Historical Performance: What has BPF's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of BPF? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
GLOBAL MARKETS-Asia stocks dip after Fed tapers aggressive easing expectations
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* European stock futures slip in early trade
* Fed's Powell, Bullard temper July rate cut expectations
* Dollar crawls up from 3-month lows on Fed officials' comments
* RBNZ stands pat on policy but flags more easing ahead
* Gold dips from 6-year high, but still up 8.5% for the month
By Shinichi Saoshiro
TOKYO, June 26 (Reuters) - Asian stocks dipped on Wednesday and the dollar inched up from three-month lows after Federal Reserve officials tempered expectations in the markets for aggressive monetary easing.
In early European trade, the pan-region Euro Stoxx 50 futures were down 0.29%, German DAX futures lost 0.31% and Britain's FTSE futures slipped 0.26%.
Fed Chair Jerome Powell on Tuesday said the central bank is "insulated from short-term political pressures," pushing back against U.S. President Donald Trump's demand for a significant rate cut.
Powell, however, said Fed policymakers are wrestling with questions on whether uncertainties around U.S. tariffs, Washington's conflicts with trading partners and tame inflation require a rate cut.
Separately, St. Louis Fed President James Bullard told Bloomberg Television he does not think the U.S. economy is dire enough to warrant a 50-basis-point cut in July, even though he pushed to lower rates last week.
Equity markets have rallied this month, with Wall Street shares advancing to record highs, after the Fed was seen to have opened the door to possible rate cuts as early as next month at is policy-setting meeting last week.
According to latest data from CME Group's FedWatch program, federal funds futures implied that traders now see a 27% chance of the Fed lowering rates by half a percentage point in July, compared to 42% on Monday.
Trump said on Twitter on Monday that the Fed "doesn't know what it is doing," adding that it "raised rates far too fast" and "blew it" given low inflation and slowing global growth.
MSCI's broadest index of Asia-Pacific shares outside Japan declined 0.15%, tracking overnight losses on Wall Street.
The Shanghai Composite Index edged down 0.25% and Australian stocks dipped 0.1%. Japan's Nikkei retreated 0.6%.
"While Powell's comments do not alter expectations that the Fed will ease sooner or later, they do leave a slightly negative impact on equities," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.
"The focus is now on the G20 summit. Market expectations for a meaningful breakthrough being achieved in U.S.-China trade talks are quite low, so any signs of an improvement could bode well for risk sentiment."
The United States hopes to re-launch trade talks with Beijing after Trump and his Chinese counterpart Xi Jinping meet in Japan during the G20 summit on Saturday but Washington will not accept any conditions on tariffs, a senior administration official said on Tuesday.
The two sides could agree not to impose new tariffs as a goodwill gesture to get negotiations going, the official said, but it was unclear if that would happen.
Many G20 members have a stake in the outcome because the row has disrupted global supply chains, slowed world growth and stirred expectations of interest rate cuts or other stimulus measures by some of the group's central banks.
The dollar index against a basket of six major currencies was up 0.15% at 96.302, extending modest overnight gains.
The index had bounced back from 95.843 on Tuesday, its lowest level since March 21, following comments from the top Fed officials.
The dollar added 0.3% to 107.490 yen after a rebound from a near six-month low of 106.780.
The greenback had sunk to the six-month trough as the yen, a perceived safe haven, had drawn bids in the face of brewing U.S.-Iran tensions.
The euro slipped 0.1% to $1.1353 after being nudged off a three-month peak of $1.1412.
The New Zealand dollar edged higher after the Reserve Bank of New Zealand (RBNZ) stood pat on monetary policy on Thursday, keeping rates at a record low 1.50%. But the kiwi's gains were limited as the central bank expressed concern towards economic risks at home and abroad.
"Overall, today's announcement provides a strengthened signal that another cut is coming, most likely soon, unless there is a marked improvement in the global outlook," wrote economists at HSBC.
The kiwi last traded 0.2% higher at $0.6651.
U.S. crude oil futures advanced roughly 2% to touch a four-week high of $59.10 per barrel after data showed a decline in U.S. crude stocks.
The U.S. data helped underpin a crude market already buoyed by worries over potential U.S.-Iran conflict.
Spot gold slipped from a six-year high of $1,438.63 an ounce scaled on Tuesday after the comments from Fed officials trimmed expectations for a rate hike in July.
Gold was down 1% at $1,407.61 an ounce, headed to snap a six-day winning streak. The precious metal was still up 8.5% so far this month. (Editing by Shri Navaratnam, Sam Holmes & Kim Coghill) |
Did You Manage To Avoid Sabien Technology Group's (LON:SNT) 99% Share Price Wipe Out?
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Sabien Technology Group Plc(LON:SNT) shareholders will doubtless be very grateful to see the share price up 46% in the last quarter. But will that heal all the wounds inflicted over 5 years of declines? Unlikely. Five years have seen the share price descend precipitously, down a full 99%. So we don't gain too much confidence from the recent recovery. The real question is whether the business can leave its past behind and improve itself over the years ahead.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
See our latest analysis for Sabien Technology Group
With just UK£468,000 worth of revenue in twelve months, we don't think the market considers Sabien Technology Group to have proven its business plan. We can't help wondering why it's publicly listed so early in its journey. Are venture capitalists not interested? So it seems that the investors focused more on what could be, than paying attention to the current revenues (or lack thereof). Investors will be hoping that Sabien Technology Group can make progress and gain better traction for the business, before it runs low on cash.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing. It certainly is a dangerous place to invest, as Sabien Technology Group investors might realise.
Sabien Technology Group had liabilities exceeding cash by UK£73,000 when it last reported in December 2018, according to our data. That makes it extremely high risk, in our view. But since the share price has dived -65% per year, over 5 years, it looks like some investors think it's time to abandon ship, so to speak. The image below shows how Sabien Technology Group's balance sheet has changed over time; if you want to see the precise values, simply click on the image.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. Would it bother you if insiders were selling the stock? I would feel more nervous about the company if that were so. You canclick here to see if there are insiders selling.
Investors in Sabien Technology Group had a tough year, with a total loss of 73%, against a market gain of about 1.7%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 65% over the last half decade. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You could get a better understanding of Sabien Technology Group's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss thisfreelist of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
PRESS DIGEST- New York Times business news - June 26
June 26 (Reuters) - The following are the top stories on the New York Times business pages. Reuters has not verified these stories and does not vouch for their accuracy.
- United States chip makers including Intel Corp and Micron Technology Inc are still selling millions of dollars of products to Huawei Technologies Co Ltd despite a Trump administration ban on the sale of American technology to the Chinese telecommunications giant, according to four people with knowledge of the sales. https://nyti.ms/2J0kLrK
- The drugmaker AbbVie Inc said on Tuesday that it planned to buy Allergan Plc, the maker of Botox, for about $63 billion. https://nyti.ms/2JkqitJ
- Online home furnishings giant, Wayfair's employees are planning to walk out of the company's Boston headquarters on Wednesday to protest its sale of $200,000 worth of bedroom furniture to a government contractor that operates a network of shelters for migrant children near the southwestern border. https://nyti.ms/2J5we9C
- Facebook Inc's partners including Visa Inc, Mastercard Inc and Uber Technologies Inc, who will govern its digital currency Libra, signed nonbinding agreements to join the effort partly because they knew they weren't obliged to use or promote the digital token and could easily back out if they didn't like where it was going, said executives at seven of those companies. https://nyti.ms/2J5x4TO (Compiled by Bengaluru newsroom) |
India's gold demand could fall to three-year low as prices hit record high
By Rajendra Jadhav MUMBAI (Reuters) - India's gold demand could fall 10% in 2019 from a year ago to the lowest level in three years as record high local prices dent retail purchases during a key festive season, the head of an industry body told Reuters. Lower purchases by India, the world's second biggest consumer after China, could limit a rally in global prices that hit a 6-year high earlier this week. "Of late, customers are not used to such a jump in prices," Anantha Padmanabhan, chairman of the All India Gem and Jewellery Domestic Council (GJC) told Reuters by telephone. "They will not raise allocations to buy gold just because prices have risen. Volume-wise demand will drop 10% from last year." Local gold prices hit a record 35,960 rupees ($519) per 10 grams on Tuesday, having jumped more than 10 percent over the past month, rising in line with international prices on tensions in the Middle East. India's gold consumption dipped 1.5% in 2018 to 760.4 tonnes, below a 10-year average of 838 tonnes, according to data compiled by the World Gold Council. The council in May forecast consumption this year at 750 to 850 tonnes after demand rose 5 percent in the March quarter. But the sudden price rise has affected sentiment, jewellers said. Bullion dealers and jewellers are reporting that sales have dropped to levels more than 50 percent below normal in the past 10 days, said B Govindan, president of All Kerala Gold and Silver Merchants Association. Weak demand was forcing dealers to offer a discount of up to $25 an ounce over official domestic prices, the largest since September 2016. The domestic price includes a 10% import tax and 3% sales tax. Demand usually picks up in the second half of the year due to the wedding season and as Indians celebrate festivals such as Dussehra and Diwali, when buying gold is considered auspicious. "Demand will fall during festivals if prices remain at the current level," said Mukesh Kothari, director at dealer RiddiSiddhi Bullions in Mumbai. Story continues Demand from rural areas has also softened due to drought in some areas and could remain under pressure if this year's monsoon fails, Kothari said. The Indian monsoon has been progressing slowly with rainfall 37% below average since the start of the season on June 1. Two-thirds of India's gold demand comes from rural areas, where jewellery is a traditional store of wealth. The price rise has also prompted some consumers to sell their old jewellery, said Govindan, adding "Some people think this is best time to sell their ornaments." (Reporting by Rajendra Jadhav; editing by Richard Pullin) |
Emma Stone Suffers Shoulder Injury After 'Slipping on a Floor': Source
Emma Stone is recovering after falling and injuring herself. A source close to the actress tells PEOPLE Stone, 30, hurt her shoulder after “slipping on a floor” at a home. It is currently not clear if the painful incident took place at a property where she is staying in London ahead of her new film project or another residence. The accident did not happen at a Spice Girls reunion concert, says the source, despite a report that Stone broke her shoulder after tumbling off a pal’s shoulders while watching her favorite band. Spice Girls member Emma Bunton shared an Instagram photo of herself with Stone following a show on June 13. “When Emma met Emma,” Bunton, 43, wrote in the caption of the photos, and she added the hashtag “#2become1” in reference to the group’s 1996 hit of that name. A report in the Sun also claimed that the injury has negatively impacted her role in Disney’s live-action film Cruella because she was ordered by doctors to rest for two months. But another insider tells PEOPLE that her injury will not affect her upcoming role. “Production hadn’t started so this is not causing any major issues. They are still in pre-production and she’ll begin once healed,” the insider adds. Emma Stone | Nicholas Hunt/Getty Images for Louis Vuitton RELATED: Emma Stone Says She Felt ‘Gloomy for About a Week’ After Turning 30 According to Variety , Stone will play Cruella De Vil, the villain who repeatedly tried to capture the puppies in 101 Dalmatians . Emma Thompson is in early talks to star opposite Stone, Variety reported. Earlier this month, it was announced that Easy A , Stone’s breakthrough 2010 teen comedy, is making its return as a spin-off , The Hollywood Reporter revealed. RELATED VIDEO: Emma Stone Reveals Her Favorite Movie Moment of All Time Stone starred as high schooler Olive Penderghast, who takes inspiration from The Scarlet Letter to enhance her social standings to mixed results. Bert Royal, the screenwriter of the original film, is writing the new script that will be set once again at Ojai North High School in California. The spinoff will feature new students dealing with the struggles of high school and teenage life. The film was Stone’s first lead role in a film and shot her into stardom. She also earned a Golden Globe nomination for Best Actress. Stone followed up Easy A with further success in hit films such as Crazy, Stupid, Love , The Help , and Birdman . She won the Oscar for Best Actress in 2017 for La La Land . |
Are Dividend Investors Making A Mistake With Avingtrans plc (LON:AVG)?
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Could Avingtrans plc (LON:AVG) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. Unfortunately, it's common for investors to be enticed in by the seemingly attractive yield, and lose money when the company has to cut its dividend payments.
A 1.6% yield is nothing to get excited about, but investors probably think the long payment history suggests Avingtrans has some staying power. Some simple analysis can offer a lot of insights when buying a company for its dividend, and we'll go through this below.
Click the interactive chart for our full dividend analysis
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Avingtrans paid out 444% of its profit as dividends, over the trailing twelve month period. Unless there are extenuating circumstances, from the perspective of an investor who hopes to own the company for many years, a payout ratio of above 100% is definitely a concern.
In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. Avingtrans paid out 64% of its free cash flow last year, which is acceptable, but is starting to limit the amount of earnings that can be reinvested into the business. It's good to see that while Avingtrans's dividends were not covered by profits, at least they are affordable from a cash perspective. Still, if the company repeatedly paid a dividend greater than its profits, we'd be concerned. Very few companies are able to sustainably pay dividends larger than their reported earnings.
As Avingtrans's dividend was not well covered by earnings, we need to check its balance sheet for signs of financial distress. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA measures a company's total debt load relative to its earnings (lower = less debt), while net interest cover measures the company's ability to pay the interest on its debt (higher = greater ability to pay interest costs). Avingtrans has net debt of 0.91 times its earnings before interest, tax, depreciation and amortisation (EBITDA), which is generally seen as an acceptable level of debt.
We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. With EBIT of 4.47 times its interest expense, Avingtrans's interest cover is starting to look a bit thin.
Consider gettingour latest analysis on Avingtrans's financial position here.
One of the major risks of relying on dividend income, is the potential for a company to struggle financially and cut its dividend. Not only is your income cut, but the value of your investment declines as well - nasty. Avingtrans has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. This dividend has been unstable, which we define as having fallen by at least 20% one or more times over this time. During the past ten-year period, the first annual payment was UK£0.013 in 2009, compared to UK£0.036 last year. This works out to be a compound annual growth rate (CAGR) of approximately 11% a year over that time. The growth in dividends has not been linear, but the CAGR is a decent approximation of the rate of change over this time frame.
It's not great to see that the payment has been cut in the past. We're generally more wary of companies that have cut their dividend before, as they tend to perform worse in an economic downturn.
With a relatively unstable dividend, it's even more important to evaluate if earnings per share (EPS) are growing - it's not worth taking the risk on a dividend getting cut, unless you might be rewarded with larger dividends in future. Over the past five years, it looks as though Avingtrans's EPS have declined at around 30% a year. If earnings continue to decline, the dividend may come under pressure. Every investor should make an assessment of whether the company is taking steps to stabilise the situation.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. We're not keen on the fact that Avingtrans paid out such a high percentage of its income, although its cashflow is in better shape. Second, earnings per share have been in decline, and its dividend has been cut at least once in the past. In this analysis, Avingtrans doesn't shape up too well as a dividend stock. We'd find it hard to look past the flaws, and would not be inclined to think of it as a reliable dividend-payer.
Now, if you want to look closer, it would be worth checking out ourfreeresearch on Avingtransmanagement tenure, salary, and performance.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Adding Mission Marketing Group (LON:TMMG) To Your Watchlist Today?
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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 Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.'
In the age of tech-stock blue-sky investing, my choice may seem old fashioned; I still prefer profitable companies likeMission Marketing Group(LON:TMMG). While profit is not necessarily a social good, it's easy to admire a business than can consistently produce it. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed.
Check out our latest analysis for Mission Marketing Group
If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. Over the last three years, Mission Marketing Group has grown EPS by 12% per year. That growth rate is fairly good, assuming the company can keep it up.
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. While we note Mission Marketing Group's EBIT margins were flat over the last year, revenue grew by a solid 11% to UK£160m. That's a real positive.
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.
Since Mission Marketing Group is no giant, with a market capitalization of UK£74m, so you shoulddefinitely check its cash and debtbeforegetting too excited about its prospects.
Like the kids in the streets standing up for their beliefs, insider share purchases give me reason to believe in a brighter future. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. Of course, we can never be sure what insiders are thinking, we can only judge their actions.
In the last twelve months Mission Marketing Group insiders spent UK£4.0k on stock; good news for shareholders. While this isn't much, we also note an absence of sales.
The good news, alongside the insider buying, for Mission Marketing Group bulls is that insiders (collectively) have a meaningful investment in the stock. Indeed, they hold UK£15m worth of its stock. That's a lot of money, and no small incentive to work hard. That amounts to 20% of the company, demonstrating a degree of high-level alignment with shareholders.
While insiders are apparently happy to hold and accumulate shares, that is just part of the pretty picture. That's because on our analysis the CEO, James Clifton, is paid less than the median for similar sized companies. I discovered that the median total compensation for the CEOs of companies like Mission Marketing Group with market caps under UK£157m is about UK£253k.
The Mission Marketing Group CEO received UK£206k in compensation for the year ending December 2018. That comes in below the average for similar sized companies, and seems pretty reasonable to me. 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. It can also be a sign of good governance, more generally.
One positive for Mission Marketing Group is that it is growing EPS. That's nice to see. Better yet, insiders are significant shareholders, and have been buying more shares. To me, that all makes it well worth a spot on your watchlist, as well as continuing research. Now, you could try to make up your mind on Mission Marketing Group by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry.
There are plenty of other companies that have insiders buying up shares. So if you like the sound of Mission Marketing Group, you'll probably love thisfreelist of growing companies that insiders are buying.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
With EPS Growth And More, Mission Marketing Group (LON:TMMG) 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, likeMission Marketing Group(LON:TMMG). Even if the shares are fully valued today, most capitalists would recognize its profits as the demonstration of steady value generation. While a well funded company may sustain losses for years, unless its owners have an endless appetite for subsidizing the customer, it will need to generate a profit eventually, or else breathe its last breath.
Check out our latest analysis for Mission Marketing Group
If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. It's no surprise, then, that I like to invest in companies with EPS growth. Mission Marketing Group managed to grow EPS by 12% per year, over three years. That growth rate is fairly good, assuming the company can keep it up.
Careful consideration of revenue growth and earnings before interest and taxation (EBIT) margins can help inform a view on the sustainability of the recent profit growth. Mission Marketing Group maintained stable EBIT margins over the last year, all while growing revenue 11% to UK£160m. That's a real positive.
You can take a look at the company's revenue and earnings growth trend, in the chart below. For finer detail, click on the image.
Since Mission Marketing Group is no giant, with a market capitalization of UK£74m, so you shoulddefinitely check its cash and debtbeforegetting too excited about its prospects.
Like the kids in the streets standing up for their beliefs, insider share purchases give me reason to believe in a brighter future. Because oftentimes, the purchase of stock is a sign that the buyer views it as undervalued. Of course, we can never be sure what insiders are thinking, we can only judge their actions.
In the last twelve months Mission Marketing Group insiders spent UK£4.0k on stock; good news for shareholders. While this isn't much, we also note an absence of sales.
Along with the insider buying, another encouraging sign for Mission Marketing Group is that insiders, as a group, have a considerable shareholding. To be specific, they have UK£15m worth of shares. That's a lot of money, and no small incentive to work hard. That amounts to 20% of the company, demonstrating a degree of high-level alignment with shareholders.
While insiders are apparently happy to hold and accumulate shares, that is just part of the pretty picture. The cherry on top is that the CEO, James Clifton is paid comparatively modestly to CEOs at similar sized companies. For companies with market capitalizations under UK£157m, like Mission Marketing Group, the median CEO pay is around UK£253k.
The Mission Marketing Group CEO received UK£206k in compensation for the year ending December 2018. That comes in below the average for similar sized companies, and seems pretty reasonable to me. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. It can also be a sign of a culture of integrity, in a broader sense.
One important encouraging feature of Mission Marketing Group is that it is growing profits. On top of that, we've seen insiders buying shareseven though they already own plenty. That makes the company a prime candidate for my watchlist - and arguably a research priority. 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 Mission Marketing Group is trading on a high P/E or a low P/E, relative to its industry.
There are plenty of other companies that have insiders buying up shares. So if you like the sound of Mission Marketing Group, you'll probably love thisfreelist of growing companies that insiders are buying.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Australian media giants demand an end to curbs on press freedom
By Byron Kaye
SYDNEY, June 26 (Reuters) - Australia's national broadcaster and two biggest newspaper publishers called on the government on Wednesday to protect press freedom, declaring media laws outdated, inconsistent and used by the powerful to keep embarrassing information secret.
The state-funded Australian Broadcasting Corp (ABC), News Corp's Australian arm, and broadcaster and newspaper publisher Nine Entertainment Co Holdings Ltd made the demand after a series of police raids, adverse court rulings and criminal prosecutions of journalists.
The rare show of unity by Australia's usually tribal media industry underscored concern about a lack of legal protection for journalists. The issue grabbed international attention earlier this month when police raided the ABC's head office in Sydney and a News Corp editor's home over separate reports.
"Something has shifted," said Michael Miller, News Corp executive chairman for Australia and New Zealand.
"The raids ... were intimidation, not investigation," he said in a joint speech by the media bosses in Canberra.
ABC managing director David Anderson said government rhetoric about the importance of a free press was "not being matched by the reality".
"Our journalists have too many impediments in their path including the unacceptable risk of being treated as criminals," Anderson said.
He said the raid on the ABC office was based on a World War One-era Crimes Act.
The ABC and News Corp plan to challenge the legality of the raids, although Miller said that would not address concerns about how warrants for the raids were issued.
Global attention turned to press freedom in Australia after a court order prevented media outlets reporting on a guilty verdict on child sex abuse charges against Catholic Cardinal George Pell.
Some Australian outlets reported that an unidentified person had been convicted but some foreign media companies identified Pell because they were outside Australia's jurisdiction.
Prosecutors are now seeking fines and jail time for three dozen Australian journalists and publishers for their coverage of the trial. Pell is appealing against his guilty verdict.
Oscar-winning actor Geoffrey Rush was awarded a A$2.8 million ($2 million) defamation payment in May against News Corp, the largest defamation payout in Australian history, after it published reports accusing him of inappropriate behaviour. News Corp is appealing against that finding.
A court found this week three media companies, including News Corp and Nine-owned newspaper publisher Fairfax, were liable for defamatory comments posted below articles on their Facebook pages despite being unable to edit the comments by members of the public.
"The growth of costly judgments based on Facebook posts or Google reviews show the law has ... failed to keep step with the way the world has changed," said Nine CEO Hugh Marks.
($1 = 1.4364 Australian dollars) (Reporting by Byron Kaye Editing by Paul Tait) |
How Alfa Laval AB (publ) (STO:ALFA) Could Add Value To Your Portfolio
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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Alfa Laval AB (publ) (STO:ALFA) due to its excellent fundamentals in more than one area. ALFA is a well-regarded dividend payer that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, read the fullreport on Alfa Laval here.
ALFA is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. ALFA's has produced operating cash levels of 0.43x total debt over the past year, which implies that ALFA's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For those seeking income streams from their portfolio, ALFA is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 2.5%.
For Alfa Laval, I've compiled three fundamental aspects you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for ALFA’s future growth? Take a look at ourfree research report of analyst consensusfor ALFA’s outlook.
2. Historical Performance: What has ALFA's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of ALFA? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Holding TP Group plc (LON:TPG)?
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Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on TP Group plc (LON:TPG) due to its excellent fundamentals in more than one area. TPG is a company with strong financial health as well as a buoyant future outlook. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, take a look at thereport on TP Group here.
One reason why investors may be attracted to TPG is its explosive triple-digit earnings growth potential in the near future. The optimistic bottom-line growth is supported by an outstanding revenue growth of 78% over the same time period, which indicates that earnings is driven by top-line activity rather than purely unsustainable cost-reduction initiatives. TPG's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This suggests prudent control over cash and cost by management, which is a crucial insight into the health of the company. TPG appears to have made good use of debt, producing operating cash levels of 0.96x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
For TP Group, I've put together three fundamental aspects you should further research:
1. Historical Performance: What has TPG's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
2. Valuation: What is TPG 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 TPG is currently mispriced by the market.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of TPG? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why We Think TP Group plc (LON:TPG) Could Be Worth Looking At
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TP Group plc (LON:TPG) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of TPG, it is a company with strong financial health as well as an optimistic future outlook. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, take a look at thereport on TP Group here.
One reason why investors may be attracted to TPG is its explosive triple-digit earnings growth potential in the near future. This growth in the bottom-line is bolstered by an impressive top-line expansion of 78% over the same period, which is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. TPG is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that TPG has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. TPG's has produced operating cash levels of 0.96x total debt over the past year, which implies that TPG's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
For TP Group, I've put together three important aspects you should look at:
1. Historical Performance: What has TPG's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
2. Valuation: What is TPG 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 TPG is currently mispriced by the market.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of TPG? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Some Europlasma (EPA:ALEUP) Shareholders Have Taken A Painful 92% Share Price Drop
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Every investor on earth makes bad calls sometimes. But really big losses can really drag down an overall portfolio. So take a moment to sympathize with the long term shareholders ofEuroplasma S.A.(EPA:ALEUP), who have seen the share price tank a massive 92% over a three year period. That might cause some serious doubts about the merits of the initial decision to buy the stock, to put it mildly. And over the last year the share price fell 76%, so we doubt many shareholders are delighted. It's down 6.8% in the last seven days.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
Check out our latest analysis for Europlasma
Europlasma isn't a profitable company, so it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last three years, Europlasma saw its revenue grow by 2.5% per year, compound. Given it's losing money in pursuit of growth, we are not really impressed with that. But the share price crash at 56% per year does seem a bit harsh! While we're definitely wary of the stock, after that kind of performance, it could be an over-reaction. Before considering a purchase, take a look at the losses the company is racking up.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
Balance sheet strength is crucual. It might be well worthwhile taking a look at ourfreereport on how its financial position has changed over time.
Over the last year, Europlasma shareholders took a loss of 76%. In contrast the market gained about 6.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Shareholders have lost 56% per year over the last three years, so the share price drop has become steeper, over the last year; a potential symptom of as yet unsolved challenges. We would be wary of buying into a company with unsolved problems, although some investors will buy into struggling stocks if they believe the price is sufficiently attractive. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
Of courseEuroplasma may not be the best stock to buy. So you may wish to see thisfreecollection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on FR exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Worried About Insider Transactions At Travis Perkins plc (LON:TPK)?
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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 we'll take a look at whether insiders have been buying or selling shares inTravis Perkins plc(LON:TPK).
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
See our latest analysis for Travis Perkins
The Group Human Resources Director, Carol Kavanagh, made the biggest insider sale in the last 12 months. That single transaction was for UK£287k worth of shares at a price of UK£14.36 each. That means that an insider was selling shares at around the current price of UK£13.08. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.
Happily, we note that in the last year insiders paid UK£91k for 7476 shares. But they sold 63605 for UK£775k. In total, Travis Perkins insiders sold more than they bought over the last year. The sellers received a price of around UK£12.19, on average. It's not particularly great to see insiders were selling shares at below recent prices. Of course, the sales could be motivated for a multitude of reasons, so we shouldn't jump to conclusions. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
We saw some Travis Perkins insider buying shares in the last three months. Insiders shelled out UK£23k for shares in that time. It's great to see that insiders are only buying, not selling. But the amount invested in the last three months isn't enough for us too put much weight on it, as a single factor.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Travis Perkins insiders own about UK£18m worth of shares. That equates to 0.6% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
Our data shows a little insider buying, but no selling, in the last three months. The net investment is not enough to encourage us much. Still, the insider transactions at Travis Perkins in the last 12 months are not very heartening. The modest level of insider ownership is, at least, some comfort. Therefore, you should should definitely take a look at thisFREEreport showing analyst forecasts for Travis Perkins.
Of courseTravis Perkins 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. |
A Look At The Fair Value Of ERYTECH Pharma S.A. (EPA:ERYP)
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Today we'll do a simple run through of a valuation method used to estimate the attractiveness of ERYTECH Pharma S.A. (EPA:ERYP) as an investment opportunity by estimating the company's future cash flows and discounting them to their present 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.
See our latest analysis for ERYTECH Pharma
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
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 (\u20ac, Millions)", "2019": "\u20ac-58.90", "2020": "\u20ac-54.80", "2021": "\u20ac11.00", "2022": "\u20ac14.39", "2023": "\u20ac17.53", "2024": "\u20ac20.24", "2025": "\u20ac22.48", "2026": "\u20ac24.27", "2027": "\u20ac25.68", "2028": "\u20ac26.77"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x1", "2020": "Analyst x3", "2021": "Analyst x1", "2022": "Est @ 30.83%", "2023": "Est @ 21.8%", "2024": "Est @ 15.48%", "2025": "Est @ 11.06%", "2026": "Est @ 7.96%", "2027": "Est @ 5.79%", "2028": "Est @ 4.27%"}, {"": "Present Value (\u20ac, Millions) Discounted @ 8.88%", "2019": "\u20ac-54.09", "2020": "\u20ac-46.22", "2021": "\u20ac8.52", "2022": "\u20ac10.24", "2023": "\u20ac11.45", "2024": "\u20ac12.15", "2025": "\u20ac12.39", "2026": "\u20ac12.28", "2027": "\u20ac11.94", "2028": "\u20ac11.43"}]
Present Value of 10-year Cash Flow (PVCF)= €-9.92m
"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 (0.7%) 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 8.9%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = €27m × (1 + 0.7%) ÷ (8.9% – 0.7%) = €331m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €€331m ÷ ( 1 + 8.9%)10= €141.26m
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is €131.34m. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of €7.32. Relative to the current share price of €6.11, the company appears about fair value at a 17% 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 ERYTECH Pharma 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 8.9%, which is based on a levered beta of 1.226. 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. For ERYTECH Pharma, I've put together three essential aspects you should further research:
1. Financial Health: Does ERYP 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 ERYP'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 ERYP? 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 FR 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. |
Cardano’s ADA Technical Analysis – Resistance Levels in Play – 26/06/19
• Cardano’s ADA fell by 2.24% on Tuesday. Reversing a 0.90% gain from Monday, Cardano’s ADA ended the day at $0.09577.
• A start of a day intraday high $0.09906 saw Cardano’s ADA fall short of the first major resistance level at $0.10060.
• A mid-morning intraday low $0.090413 saw Cardano’s ADA fall through the first major support level at $0.0942.
• The extended bearish trend remained intact. Cardano’s ADA continued to fall short of the 23.6% FIB Retracement Level of $0.1125.
How to Buy Cardano’s ADA
Cardano’s ADA fell by 2.24% on Tuesday. Reversing a 0.90% gain from Monday, Cardano’s ADA ended the day at $0.09577.
Bearish through the morning, Cardano’s ADA fell from an early intraday high $0.9906 to a mid-day intraday low $0.09041.
Steering clear of the first major resistance level at $0.1006, Cardano’s ADA slid through the first major support level at $0.0942.
Finding support from the broader market through the afternoon, Cardano’s ADA recovered to $0.096 levels late in the day.
The extended bearish trend remained firmly intact in spite of 5 weeks in the green out of the last 7. Cardano’s ADA continued to fall short of the 23.6% FIB Retracement Level of $0.1125, following 7thDecember’s new swing lo $0.02724.
For the bulls, Cardano’s ADA would need to break out from the 23.6% FIB to $0.16 levels to form a bullish trend.
At the time of writing, Cardano’s ADA was up by 1.21% to $0.09694. A particularly choppy start to the day saw Cardano’s ADA rally to a morning high $0.10887 before hitting reverse.
Cardano’s ADA broke through the first major resistance level at $0.0998 and second major resistance level at $0.1037 before sliding to a low $0.0935.
In spite of the pullback, Cardano’s ADA managed to steer clear of the first major support level early on in the day.
A move back through the first major resistance level at $0.0998 to $0.10 levels would support another run at $0.11 levels later in the day.
Cardano’s ADA would need support from the broader market, however, to break out from the second major resistance level at $0.1037.
In the event of a breakout, the third major resistance level at $0.1124 and 23.6% FIB of $0.1125 would cap the upside on the day.
Failure to move back through the first major resistance level could see Cardano’s ADA hit reverse. A pullback through $0.0950 would bring the first major support level at $0.0911 into play before any recovery.
Barring a broad-based crypto reversal, Cardano’s ADA would likely steer clear of sub-$0.90 levels on the day.
Major Support Level: $0.09980
Major Resistance Level: $0.09110
23.6% FIB Retracement Level: $0.1125
38.2% FIB Retracement Level: $0.1652
62% FIB Retracement Level: $0.2505
Please let us know what you think in the comments below
Thanks, Bob
Thisarticlewas originally posted on FX Empire
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KG Funds Management’s Return, AUM, and Holdings
KG Funds Managementis an event-driven hedge fund established in December 2008, with its headquarters in New York. The fund was co-founded by Ike Kier, the current CEO, and Ilya Zaides, its present CIO and Portfolio Manager. Ilya Zaides holds a bachelor’s degree in Economics from Berkeley University of California, and J.D. from New York University. He started his career dealing with corporate transactions and financial products at Milbank, Tweed, Hadley & McCloy and King & Spalding. Prior to co-founding KG Funds Management, he held positions of an analyst at Ivy Asset Management and Senior Vice President and Head of Hedge Fund Research in Auda Asset Management.
The idea of the fund’s founders was to outperform the S&P 500, much like of many other investors out there. And even though KG Funds Management was founded during the heavy financial crisis, its investment philosophy proved to work pretty well within such an environment. The fund started off with Ike Kier’s own money, and they exploredwarrants from the TARP. Before considering a company to invest in, the fund monitors around 100 companies for several years to identify the “events” which could make the stockundervalued or misunderstood by the market. In this way, the fund focuses on companies with high-quality businesses and assets. The companies the fund is interested in are those that are able to compound annual returns at 20% minimum, within a period time of three to five years. At the end of 2016, it held $220.3 million in regulatory assets under management on a discretionary basis.
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bluebay/Shutterstock.com[/caption]
When it comes to returns, KG Funds Management has shown a positive performance during the last several years. For instance, its KG Investments Fund brought back an impressive 26.85% in 2013, followed by a decrease in 2014, with a return of 8.98%. During the next period KG Investments Fund progressed returning 12.43% in 2015 and 10.82% in 2016. The following year it generated a return of fantastic 30.73%, which was the highest annual return over the past several years. In 2018, through October, KG Investments Fund returned 14.28%. Its total annual return amounted to 426.02%, with a compound annual return of 18.56%, and the worst drawdown was 20.30.
Insider Monkey’s mission is to identify promising (and also terrible) hedge fund stock pitches and share them with our subscribers. We launched a long activist investing strategy in our monthly newsletter 2 years ago. This strategy’s stock picks returned 61% in 2 short years, vs. a gain of 21% for the S&P 500 Index ETF (SPY). Last October we shared one of our stock picks, Ascendis Pharmaceuticals (ASND), in a free sample issue of our monthly newsletter (you can stilldownload it free of charge). The stock doubled in less than 5 months.
We have also been very successful at identifying stocks that will decline even in a bull market. We launched our short strategy a little more than 2 years ago and share our short stock picks in our quarterly newsletter. This strategy’s picks lost 30.9% since then, vs. a gain of 24% for the S&P 500 Index. This means our short strategy actually outperformed the market by nearly 55 percentage points (let us know if you don’t understand how the outperformance for a short strategy is calculated).
Recently our monthly newsletter identified another undervalued stock that is expected to increase its earnings by more than 10% annually and trades at only 10 times its 2019 earnings. We expect this stock to return 60% in the next 12-24 months. We take a closer look at hedge funds like KG Funds Management in order to identify their best and worst ideas.
At the end of the first quarter of 2019, KG Fund Management’s equity portfolio carried a value of $503.43 million, which is about 4.77% higher compared to the last quarter of 2018 when it was worth $480.52 million. In the first quarter of 2019 KG Fund Management held a total of eight positions. There weren’t any new additions to the fund’s portfolio, and only one position was sold -Autozone Inc (NYSE:AZO). The fund said goodbye to 23,000 Autozone's shares, which carried a value of $19.28 million. During the quarter, the fund lowered its stake inAlphabet Inc. (NASDAQ:GOOG)by 1% to 48,007 shares worth $56.33 million. Alphabet Inc. is at the fifth place of the30 Most Popular Stocks Among Hedge Funds in Q1 of 2019.
The fund has also lowered its stake inAthene Holding Ltd. (NYSE:ATH)by 17%, or 390,170 shares. Nevertheless, Athene Holding Ltd. was at the third position among the top KG Fund Management’s positions in Q1 2019, with 1.83 million shares worth $74.79 million, comprising 14.85% of the fund's portfolio. Athene Holding Ltd. is an insurance company that primarily deals with retirement savings and issuing and reinsuring fixed annuities. It is a privately owned company based in Pembroke. The company’s market cap is $8.03 billion. Year-to-date, the company’s stock gained 3.13%, and on June 25thit had a closing price of $41.80.
On the other side, the fund decided to increase its stake inCbs Corp (NYSE:CBS)by 14%, or 86,788 shares. At the end of Q1, the fund held 684,965 of the company’s shares worth $32.56 million, comprising 6.46% of the fund’s portfolio. Cbs Corp is a New York-based mass media corporation. It is focused on television production, distributing various contents via many platforms. Cbs Corp is among the most watched television networks in the US. According to the company’s report for the Q1 2019, the revenues have increased by 11% compared to the same period last year, reaching $4.17 billion. The company also reported adjusted diluted earnings per share of $1.37, which is 2% higher compared to the Q1 2018. Cbs Corp has a market cap of $18.54 billion. Since the beginning of the year, the company’s stock has gained9.33%, having the closing price of $49.92 on June 25th.
Click hereto read the rest of the article, where we discuss the rest of KG Funds Management’s positions at the end of Q1 2019.
Disclosure:None.
This article was originally published atInsider Monkey. |
Why we must let young savers tap into pensions for property and emergencies
We in Britain are not saving enough to protect our financial futures – and there are common reasons why.
For many, locking away cash in a pension when they may need it sooner for a financial emergency, or as a deposit to getting onto the housing ladder, prevents greater levels of savings.
We need to fundamentally rethink how we approach lifetime savings, not only increasing the amount we are all putting away, but introducing flexibility into the system so we can access our savings when we need them most.
Auto-enrolment has represented a step change in savings habits, but8pc of salary is not going to be enoughto secure even a moderate standard of living in retirement. The statutory level of savings does need to increase, but we should make those reforms in a way that also allows us to address the challenge of financial hardship in the short term.
Many people don’t have enough money put aside to cover them in an emergency, let alone to provide a long-term income in retirement. The statistics are sobering: 14.5 million people have no savings for a rainy day while nine million pay for essentials on credit.
People shouldn’t have to choose between financial security now and in their future.
We could introduce a hardship facility that can be integrated with retirement saving, allowing savers to access up to £1,000 on up to five occasions to help deal with times of financial hardship throughout their lives. This could more than 14 million people avoid problem debt each year.
Our research indicates that 59pc of savers between 30 and 40 would find saving into a pension more attractive with this feature.
There has beena lot of discussion recentlyaround changing pensions rules to help first-time buyers get onto the property ladder. Developing a closer relationship between saving for a home and saving for retirement is critically important to help address both issues.
We envisage young people being allowed to withdraw up to half of their early pension pots, to go towardsa deposit on their first home. However, to ensure we protect their longer term financial futures, it’s vital that we also increase savings rates so that pots are big enough to support this more flexible access to savings.
Helping young people to save more, earlier, will boost the amount of money they have available to put towards a deposit and reduce the time they spend saving for a house instead of their retirement. Combined with our other proposals, it could double the disposable income of those in retirement.
Of course, we require appropriate policies to ensure an adequate supply of housing and improve affordability. However, this policy is focused on helping young people to move from renting, not to increase demand for housing.
While the introduction of auto-enrolment has brought more than 70pc of all employees into the savings fold through statutory pension contributions, the regime doesn’t support the nearly five millionself-employedpeople in Britain, almost 80pc of whom are not saving for retirement at all.
Access to their savings would also increase the attractiveness of pensions amongs these workers. Our research suggests that 45pc of young people who are self-employed would save more for retirement if there was a facility to have limited access to funds on a rainy day.
Simply put,savings rates need to increase. Contributions of 15pc are required to deliver a moderate standard of living in retirement. Agreeing who pays these increased contributions will be one of the main talking points of this discussion – we think that this responsibility should be shared between individuals and employers.
This should provide the basis for a system built around a default position. People should have a retirement income that for average earners equates to two-thirds of their working income. If people wish to have a different level of retirement income, they should be able to follow a set of simple rules of thumb to see how they can achieve their saving goals.
People also need to believe that their savings remain theirs and to have the flexibility to save in a way that reflects any changes in their lives. Enabling people to access their money earlier in certain circumstances if they need it will increase engagement. It will give people more of the flexibility they need.
Pete Glancy is head of policy at Scottish Widows |
KG Funds Management’s Return, AUM, and Holdings (Part II)
Read the beginning of thisarticle here.
At the end of Q1 2019, the first two positions in KG Funds Management’s portfolio have remained without any changes in shares held compared to the last quarter of 2018. The biggest position at the end of Q1 2019 wasVisa Inc. (NYSE:V), a multinational corporation based in Foster City, CA, providing financial services. It is one of the world’s leading companies in electronic fund transfers, through different types of credit, gift, and debit cards. As the leading position in KG Funds Management’s portfolio, Visa Inc. was valued $90.97 million, with a total of 582,433 shares, comprising 18.07% of the fund’s portfolio. Visa Inc. reported net revenues of $5.5 billion for Q1 2019, which is 13% higher compared to Q1 2018. The company also reported earnings per share of $1.30 for Q1 2019, which is 21% higher compared to the same quarter last year. Since the beginning of the year, the company’s stock has gained 28.86%, and on June 25thit had a closing price of $171.28. The company’s market cap is $374.31 billion.
The fund's second biggest position in the first quarter of 2019 wasMastercard Inc (NYSE:MA). This company is also among the leading multinational corporations in global payment and technology services, based in New York. The company reported net revenue of $3.9 billion for the first quarter of 2019, which is 9% higher compared to the same period last year. Also, it reported adjusted diluted earnings per share of $1.78 compared to adjusted dilted earnings per share of $1.50 in the same quarter of 2018. The fund held 383,964 Matercard Inc’s shares worth $90.40 million in the first quarter of 2019. This amount comprised 17.95% of the fund’s 13F portfolio. The company’s market cap is $265.29 billion. Year-to-date, the company’s stock gained 36.89%, and on June 25thit was trading at $259.73.
KG Funds Management did not make any changes in the number of shares it held ofThe Walt Disney Company (NYSE:DIS)during Q1 2019.Hence this was the fourth largest position in the fund’s portfolio, right after Athene Holding Ltd. which we mentioned in the previous article. The Walt Disney Company is among the biggest producers of entertainment content and it is a huge mass media enterprise divided into several segments. It was founded back in 1923, with headquarters in Burbank, CA. For the second quarter of the fiscal year 2019 ended on March 30th, the company reported revenues of $14.92 million, which is 3% higher than for the Q2 of fiscal 2018. It also disclosed diluted earnings per share of $3.53 compared to $1.95 in the same period of last fiscal year. The company’s market cap is $251.85 billion. Since the beginning of the year, the company’s stock price gained 28.42%, having a closing price of $139.94 on June 25th. KG Funds Management held 630,645 company’s shares worth $70.02 million, comprising 13.9% of the fund’s portfolio.
As for the remaining two positions, the fund has increased interest in them during the first quarter of 2019. The first one isBooking Holdings Inc (NASDAQ:BKNG), which increased by 6% to 23,000 shares worth $40.13 million, comprising 7.97% of the fund’s portfolio. Another boosted position during the quarter was inComcast Corporation (NASDAQ:CMCSA), with the fund holding 1.21 million shares valued $48.22 million at the end of Q1 2019.
Disclosure:None.
This article was originally published atInsider Monkey. |
A Look At The Intrinsic Value Of ERYTECH Pharma S.A. (EPA:ERYP)
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Today we will run through one way of estimating the intrinsic value of ERYTECH Pharma S.A. (EPA:ERYP) by projecting its future cash flows and then discounting them to today's value. I will be using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
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.
See our latest analysis for ERYTECH Pharma
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.
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 (\u20ac, Millions)", "2019": "\u20ac-58.90", "2020": "\u20ac-54.80", "2021": "\u20ac11.00", "2022": "\u20ac14.39", "2023": "\u20ac17.53", "2024": "\u20ac20.24", "2025": "\u20ac22.48", "2026": "\u20ac24.27", "2027": "\u20ac25.68", "2028": "\u20ac26.77"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x1", "2020": "Analyst x3", "2021": "Analyst x1", "2022": "Est @ 30.83%", "2023": "Est @ 21.8%", "2024": "Est @ 15.48%", "2025": "Est @ 11.06%", "2026": "Est @ 7.96%", "2027": "Est @ 5.79%", "2028": "Est @ 4.27%"}, {"": "Present Value (\u20ac, Millions) Discounted @ 8.88%", "2019": "\u20ac-54.09", "2020": "\u20ac-46.22", "2021": "\u20ac8.52", "2022": "\u20ac10.24", "2023": "\u20ac11.45", "2024": "\u20ac12.15", "2025": "\u20ac12.39", "2026": "\u20ac12.28", "2027": "\u20ac11.94", "2028": "\u20ac11.43"}]
Present Value of 10-year Cash Flow (PVCF)= €-9.92m
"Est" = FCF growth rate estimated by Simply Wall St
We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. 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 0.7%. We discount the terminal cash flows to today's value at a cost of equity of 8.9%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = €27m × (1 + 0.7%) ÷ (8.9% – 0.7%) = €331m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €€331m ÷ ( 1 + 8.9%)10= €141.26m
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is €131.34m. 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 €7.32. Compared to the current share price of €6.11, the company appears about fair value at a 17% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at ERYTECH Pharma 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 8.9%, which is based on a levered beta of 1.226. 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. For ERYTECH Pharma, I've compiled three additional factors you should further research:
1. Financial Health: Does ERYP 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 ERYP'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 ERYP? 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 FR 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. |
Alibaba Aims to Double Global Brands With New English Site
(Bloomberg) -- Alibaba Group Holding Ltd. has set up a new website to double the number of global brands on its flagship online mall, taking an important step toward fulfilling its global ambitions.
The e-commerce giant began offering an English-language portal on Tmall for the first time on Wednesday to entice more merchants from around the world to sell to Chinese consumers. Alibaba is counting on the initiative to help double the number of foreign brands on Tmall Global to 40,000 in three years, said Yi Qian, deputy general manager of the service, which caters to buyers of foreign goods.
Alibaba is seeking new growth engines to offset a cooling economy at home as the trade war rages on, while fending off increasingly aggressive competitors including JD.com Inc. and Pinduoduo Inc. Billionaire co-founder Jack Ma had set a goal of generating more than half of the company’s revenue from outside of China by 2025.
“The website will widen our reach to merchants, especially to those medium and small sized businesses around the world,” Yi said in an interview. “We will help them with our logistics and marketing services.”
Alibaba grew to become China’s largest public company by popularizing e-commerce across the world’s No. 2 economy, on which it still depends for the vast majority of its business. It’s begun making inroads into Southeast Asia through the acquisition of Lazada, but now aims to broaden its reach even further.
Tmall’s new portal allows English-speaking merchants to fill in details online about their products. Alibaba then vets them based on category and quality, and will contact merchants within 72 hours to gauge if their products are a fit, Yi said. Previously, such sellers could only join Tmall through personal introduction, or by signing up at trade fairs. Other foreign-language versions of the website are in the works, including Spanish, Japanese and Korean.
Alibaba doesn’t disclose dealings over its Tmall platform, which helps merchants sell goods to 600 million-plus buyers, but it’s one of the single largest online retailers in China’s $1 trillion e-commerce arena. Jiang Fan, one of Jack Ma’s closest lieutenants, said in April the company wanted to double transaction volumes on its Tmall service in three years.
To contact the reporter on this story: Lulu Yilun Chen in Hong Kong at ychen447@bloomberg.net
To contact the editors responsible for this story: Edwin Chan at echan273@bloomberg.net, Colum Murphy
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
A Look At Fresenius SE & Co. KGaA's (FRA:FRE) Exceptional Fundamentals
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Fresenius SE & Co. KGaA (FRA:FRE) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of FRE, it is a highly-regarded dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, read the fullreport on Fresenius SE KGaA here.
FRE is currently trading below its true value, which means the market is undervaluing the company's expected cash flow going forward. This mispricing gives investors the opportunity to buy into the stock at a cheap price compared to the value they will be receiving, should analysts' consensus forecast growth be correct. Also, relative to the rest of its peers with similar levels of earnings, FRE's share price is trading below the group's average. This bolsters the proposition that FRE's price is currently discounted.
FRE is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For Fresenius SE KGaA, I've put together three relevant factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for FRE’s future growth? Take a look at ourfree research report of analyst consensusfor FRE’s outlook.
2. Historical Performance: What has FRE's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of FRE? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Bitcoin Price Hits 17-Month High Above $12.9K
Views:
• Bitcoin (BTC) rose above $12,900 for the first time in over 17 months backed by consistent levels of volume.
• Recent price action could set scope for $13,700 in the coming day on the back of strong bullish momentum.
• The hourly chart reveals extreme levels of volatility presenting harsh trading conditions for the average trader.
Bitcoin has risen above $12,900 for the first time since Jan. 21, 2018, touching a new high for 2019 at $12,919, according to CoinDesk’s BPI data.
On June 26 at 03:00 UTC, Bitcoin broke out from a bullish pattern, rising in quick succession above $12,000 on strong momentum and high volatility. As of press time, the price has dropped back to above $12,500.
Related:Tim Draper Is Bullish On Argentina’s Blockchain Tech Potential
The last time bitcoin (BTC) changed hands above $12,000 in January 2018, prices were on the way down, amid the beginnings of a down trending bear market. This time, things are much different.
BTC continues to post impressive results up 40 percent in the month of June alone, while its year-to-year performance is up by more than 250 percent, according to data at Messari.io.
The hourly chart reveals BTC’s recent movements in a bullish light as each breakout was backed by a strong showing of growing volume.
Related:Bitcoin’s Share of $350 Billion Crypto Market Highest Since 2017
As can be seen above, prices broke from an ascending triangle (typically bullish in nature) on June 25 at 21:00 UTC backed by consistent levels of growing volume, legitimizing the move on its rise northward.
A secondary ascending triangle breakout brought prices well above $12,000 and continues to eye off $13,100 in the immediate short-term, as per Fibonacci Extension theory.
The recent volatility may also see a short-term move to retest $12,500 given the levels of liquidity currently entering and exiting the markets in rapid succession.
The weekly chart also reveals some interesting insights, detailing key levels of support and resistance at $11,500 and $13,700 respectively, whereby a close above or below those levels would dictate the direction of the trend for either a continuation or a pullback in its price.
In addition, there has been a strong backing of weekly volume since the new year began, with the exception given to March, that saw below-average volume traded over the month. This is a good sign for the bulls as the moves are backed by strong liquidity and buying pressure.
If momentum and market conditions maintain their current course, BTC could set its sights on $13,500 resistance in the coming days.
Should prices fall below $11,500 then consider a retest of the $11,000 psychological support zone, overall the trend remains very bullish.
Disclosure:The author holds no cryptocurrency at the time of writing.
Bitcoin imageviaShutterstock; Charts viaTradingView
• Square Is Expanding Access to Bitcoin Deposits for Cash App Users
• Bitcoin’s Price Rises Above €10K in First Since January 2018 |
Fresenius SE & Co. KGaA (FRA:FRE): The Best Of Both Worlds
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I've been keeping an eye on Fresenius SE & Co. KGaA (FRA:FRE) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe FRE has a lot to offer. Basically, it is a notable dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. In the following section, I expand a bit more on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at thereport on Fresenius SE KGaA here.
FRE's shares are now trading at a price below its true value based on its discounted cash flows, indicating a relatively pessimistic market sentiment. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of FRE's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, FRE's share price is trading below the group's average. This further reaffirms that FRE is potentially undervalued.
Income investors would also be happy to know that FRE is a great dividend company, with a current yield standing at 1.7%. FRE has also been regularly increasing its dividend payments to shareholders over the past decade.
For Fresenius SE KGaA, there are three relevant aspects you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for FRE’s future growth? Take a look at ourfree research report of analyst consensusfor FRE’s outlook.
2. Historical Performance: What has FRE's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of FRE? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Did Gigaset AG (ETR:GGS) Use Debt To Deliver Its ROE Of 5.0%?
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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 Gigaset AG (ETR:GGS), by way of a worked example.
Gigaset has a ROE of 5.0%, based on the last twelve months. That means that for every €1 worth of shareholders' equity, it generated €0.050 in profit.
See our latest analysis for Gigaset
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Gigaset:
5.0% = €834k ÷ €17m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the amount earned after tax over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means 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. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. If you look at the image below, you can see Gigaset has a similar ROE to the average in the Communications industry classification (5.3%).
That isn't amazing, but it is respectable. ROE doesn't tell us if the share price is low, but it can inform us to the nature of the business. For those looking for a bargain, other factors may be more important. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Companies usually need to invest money to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
Although Gigaset does use debt, its debt to equity ratio of 0.81 is still low. Although the ROE isn't overly impressive, the debt load is modest, suggesting the business has potential. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is useful for comparing the quality of different businesses. In my book the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
But note:Gigaset 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. |
Simon Cowell clashes with contestant Lamont Landers
Contestant Lamont Landers clashed with Americas Got Talent judge Simon Cowell after the famous music producer stopped his performance on Tuesday night. Lamont did eventually redeem himself, but on the road to redemption he found himself at odds with both the audience and the judges. Landers, a 27-year-old musician from Huntsville, Ala., initially tried to perform Al Greens Lets Stay Together. Only a few seconds into his performance, Cowell stopped the audition. He said, I'm just wondering whether we should just come up with a better song, because your problem is that you don't take risks. After Landers shrugged off Cowells note, the producer said, I think you should come back later 'cause right now we're not understanding each other. Instead of leaving the stage, Landers sought the audience for second opinion saying, What do you guys want? Landers eventually agreed to find a new song. He returned a few hours later to perform Robyns Dancing on My Own. He continued to struggle, and when Cowell stopped the performance, Landers lashed out at the audience, saying, Everybody, please do not clap. A third time proved to be the charm for Landers. He received a standing ovation from both Cowell and the audience at the end of his performance. He received four yes votes from the judges and some words of encouragement from Cowell, who said, I know what it's like when it's frustrating and you get criticized, and you think you're right, but something's getting in the way, and you get frustrated, and then sometimes someone gives you a little bit of advice and it opens the door. I think the door has just opened for you here. Americas Got Talent airs Tuesdays at 8 p.m. on NBC . Watch as Mother of three makes history as first mom to complete American Ninja Warrior course: Read more from Yahoo! Entertainment: Dramatic episode of KUWTK reveals how the Tristan and Jordyn scandal unfolded James Corden takes Crosswalk the Musical to Paris with Les Misérables Nipsey Hussles family accepts his Humanitarian Award at emotional BET Awards Ceremony Story continues Tell us what you think! Hit us up on Twitter , Facebook or Instagram , or leave your comments below. And check out our host, Kylie Mar, on Twitter , Facebook or Instagram . Want daily pop culture news delivered to your inbox? Sign up here for Yahoo Entertainment & Lifestyle's newsletter. |
Does Gigaset AG (ETR:GGS) Have A Volatile Share Price?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! If you're interested in Gigaset AG ( ETR:GGS ), 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. Volatility is considered to be a measure of risk in modern finance theory. Investors may think of volatility as falling into two main categories. The first category is company specific volatility. This can be dealt with by limiting your exposure to any particular stock. 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. A stock with a beta below one is either less volatile than the market, or more volatile but not corellated with the overall market. In comparison a stock with a beta of over one tends to be move in a similar direction to the market in the long term, but with greater changes in price. See our latest analysis for Gigaset What GGS's beta value tells investors Zooming in on Gigaset, we see it has a five year beta of 0.90. This is below 1, so historically its share price has been rather independent from the market. This means that -- if history is a guide -- buying the stock would reduce the impact of overall market volatility in many portfolios (depending on the beta of the portfolio, of course). Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how Gigaset fares in that regard, below. Story continues XTRA:GGS Income Statement, June 26th 2019 Does GGS's size influence the expected beta? Gigaset is a rather small company. It has a market capitalisation of €49m, which means it is probably under the radar of most investors. It is not unusual for very small companies to have a low beta value, especially if only low volumes of shares are traded. Even when they are traded more actively, the share price is often more susceptible to company specific developments than overall market volatility. What this means for you: The Gigaset doesn't usually show much sensitivity to the broader market. This could be for a variety of reasons. Typically, smaller companies have a low beta if their share price tends to move a lot due to company specific developments. Alternatively, an strong dividend payer might move less than the market because investors are valuing it for its income stream. In order to fully understand whether GGS is a good investment for you, we also need to consider important company-specific fundamentals such as Gigaset’s financial health and performance track record. I urge you to continue your research by taking a look at the following: Future Outlook : What are well-informed industry analysts predicting for GGS’s future growth? Take a look at our free research report of analyst consensus for GGS’s outlook. Past Track Record : Has GGS been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look at the free visual representations of GGS's historicals for more clarity. Other Interesting Stocks : It's worth checking to see how GGS measures up against other companies on valuation. You could start with this free list of prospective options . We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Easy Come, Easy Go: How Adamas Finance Asia (LON:ADAM) Shareholders Got Unlucky And Saw 80% Of Their Cash Evaporate
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Long term investing is the way to go, but that doesn't mean you should hold every stock forever. We really hate to see fellow investors lose their hard-earned money. Anyone who heldAdamas Finance Asia Limited(LON:ADAM) for five years would be nursing their metaphorical wounds since the share price dropped 80% in that time. And it's not just long term holders hurting, because the stock is down 34% in the last year. It's down 20% in the last seven days.
Check out our latest analysis for Adamas Finance Asia
With zero revenue generated over twelve months, we don't think that Adamas Finance Asia has proved its business plan yet. You have to wonder why venture capitalists aren't funding it. So it seems that the investors focused more on what could be, than paying attention to the current revenues (or lack thereof). Investors will be hoping that Adamas Finance Asia can make progress and gain better traction for the business, before it runs low on cash.
Companies that lack both meaningful revenue and profits are usually considered high risk. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). It certainly is a dangerous place to invest, as Adamas Finance Asia investors might realise.
When it last reported its balance sheet in December 2018, Adamas Finance Asia could boast a strong position, with cash in excess of all liabilities of US$64m. This gives management the flexibility to drive business growth, without worrying too much about cash reserves. But since the share price has dropped 28% per year, over 5 years, it seems like the market might have been over-excited previously. The image below shows how Adamas Finance Asia's balance sheet has changed over time; if you want to see the precise values, simply click on the image.
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Given that situation, would you be concerned if it turned out insiders were relentlessly selling stock? I'd like that just about as much as I like to drink milk and fruit juice mixed together. It only takes a moment for you tocheck whether we have identified any insider sales recently.
Adamas Finance Asia shareholders are down 34% for the year, but the market itself is up 1.7%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 28% over the last half decade. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss thisfreelist of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why Highcroft Investments Plc (LON:HCFT) Could Have A Place In Your Portfolio
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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Highcroft Investments Plc (LON:HCFT), it is a highly-regarded dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. For those interested in digger a bit deeper into my commentary, take a look at thereport on Highcroft Investments here.
HCFT's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of HCFT's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, HCFT's share price is trading below the group's average. This further reaffirms that HCFT is potentially undervalued.
HCFT’s reputation for being one of the best dividend payers in the market is supported by the fact that it has been steadily growing its dividend payments over the past ten years and currently is one of the top yielding companies on the markets, at 5.7%.
For Highcroft Investments, I've compiled three important aspects you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for HCFT’s future growth? Take a look at ourfree research report of analyst consensusfor HCFT’s outlook.
2. Historical Performance: What has HCFT's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HCFT? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Have Insiders Been Buying Trelleborg AB (publ) (STO:TREL B) 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 we'll take a look at whether insiders have been buying or selling shares inTrelleborg AB (publ)(STO:TREL B).
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
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 Trelleborg
There wasn't any very large single transaction over the last year, but we can still observe some trading.
In the last twelve months insiders purchased 3500 shares for kr544k. On the other hand they divested 1000 shares, for kr139k. Overall, Trelleborg insiders were net buyers last year. Their average price was about kr155. These transactions suggest that insiders have considered the current price of kr132 attractive. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
Trelleborg is not the only stock insiders are buying. So take a peek at thisfreelist of growing companies with insider buying.
There was some insider buying at Trelleborg over the last quarter. They bought kr366k worth in that time. But Peter Larsson sold kr139k worth. It is good to see that insiders have been buying, but they did not buy very many shares, in the scheme of things.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Trelleborg insiders have about 0.09% of the stock, worth approximately kr32m. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. I generally like to see higher levels of ownership.
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Given that insiders also own a fair bit of Trelleborg we think they are probably pretty confident of a bright future. Of course,the future is what matters most. So if you are interested in Trelleborg, you should check out thisfreereport on analyst forecasts for the company.
But note:Trelleborg 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. |
These Fundamentals Make ID Logistics Group SA (EPA:IDL) Truly Worth Looking At
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ID Logistics Group SA (EPA:IDL) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of IDL, it is a financially-healthy company with a strong track record and a excellent future outlook. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the fullreport on ID Logistics Group here.
IDL delivered a bottom-line expansion of 57% in the prior year, with its most recent earnings level surpassing its average level over the last five years. In addition to beating its historical values, IDL also outperformed its industry, which delivered a growth of -28%. This is an notable feat for the company.
IDL's has produced operating cash levels of 0.37x total debt over the past year, which implies that IDL's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings. Also, IDL’s earnings amply cover its interest expense. Paying interest on time and in full can help the company get favourable debt terms in the future, leading to lower cost of debt and helps IDL expand.
For ID Logistics Group, I've put together three relevant aspects you should further examine:
1. Valuation: What is IDL 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 IDL is currently mispriced by the market.
2. Dividend Income vs Capital Gains: Does IDL return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Ourhistorical dividend yield visualizationquickly tells you what your can expect from IDL as an investment.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of IDL? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
German GfK consumer morale edges down heading into July
BERLIN, June 26 (Reuters) - German consumer morale fell heading into July as the slowdown weighing on Europe's largest economy darkened income expectations among shoppers, a survey showed on Wednesday. The GfK consumer sentiment indicator, based on a survey of about 2,000 Germans, fell for the second time in a row to 9.8 from 10.1 a month earlier. Economists polled by Reuters had expected a reading of 10.0. Household spending has become a key source of growth in Europe's biggest economy as record-high employment, above-inflation pay hikes and low borrowing costs boost domestic demand. The economy has been facing headwinds from trade conflicts, Brexit uncertainties and a cooling world economy, which are hurting Germany's export-oriented manufacturers. There are fears the slowdown in manufacturing could spill into the services sector and dent the robust labour market. The GfK survey showed that consumer confidence has been shaken, mainly as a result of concerns that German carmakers, which are grappling with trade frictions and a shift toward electric vehicles, could cut thousands of jobs. "So far, the income indicator has been able to benefit from the excellent development of the job market in Germany. But now the voices heralding the end of the employment boom are growing," said Rolf Buerkl, a researcher for GfK. A sub-index measuring income expectations fell to its lowest level since March 2017. Still, consumers' propensity to spend rose as shoppers seemed unperturbed by growing doubts about job security. "Whether this will remain the case depends heavily on how income prospects develop in the coming months," GfK said. "If the significant loss suffered by this indicator in June turns into a persistent downward trend, it will also be tough for propensity to buy to maintain its currently excellent level." The GfK survey was conducted from May 31 to June 14. July 19 June 19 July 18 Consumer climate 9.8 10.1 10.5 Consumer climate components June 19 May 19 June 18 - willingness to buy 53.7 50.5 55.1 - income expectations 45.5 57.7 57.4 - business cycle expectations 2.4 1.7 19.4 NOTE - The consumer climate indicator forecasts the development of real private consumption in the following month. An indicator reading above zero signals year-on-year growth in private consumption. A value below zero indicates a drop in comparison with the same period a year ago. According to GfK, a one-point change in the indicator corresponds to a year-on-year change of 0.1 percent in private consumption. The "willingness to buy" indicator represents the balance between positive and negative responses to the question: "Do you think now is a good time to buy major items?" The income expectations sub-index reflects expectations about the development of household finances in the coming 12 months. The additional business cycle expectations index reflects the assessment of those questioned of the general economic situation in the next 12 months. (Reporting by Riham Alkousaa Editing by Joseph Nasr) |
RPT-GRAPHIC-Safety first: markets wary of world politics and policy and dash for bunkers
(Repeats Tuesday story without changes)
By Abhinav Ramnarayan and Ritvik Carvalho
LONDON, June 25 (Reuters) - Gold, Switzerland's franc, Japan's yen, top-rated government bonds, and even bitcoin -- investors have dashed for havens and alternative assets this week as anxiety grows about trade wars, U.S.-Iran tensions and negative interest rates.
Although world stocks and bonds remain near record highs thanks to promises of ever more central bank largesse, the sudden dash for these financial bunkers shows all is not as calm as a cursory reading of headline indexes suggests.
Fears of a global trade war have been simmering for over a year but the latest standoff between Washington and Beijing may come to a head at the G20 summit in Japan this weekend. New U.S. tariffs on Chinese imports could kick in next month if there's no progress between the two sides.
Military tensions between the United States and Iran have also gone up several notches after Tehran's downing of an unmanned American drone last week and claims that U.S. retaliation was stopped at the last minute. A fresh wave sanctions on Iran's leaders and a war of words between the two sides have followed.
The trade and geopolitical worries are compounding investor concern about a looming global economic downturn and whether central banks are easing policy again quickly enough to offset it. Even if they are, the expanding universe of bonds with a negative yield -- effectively penalising investors for holding them -- is unnerving for many.
"It comes at the worst possible moment because we are late-cycle, we are worried about global growth, and the U.S. are fighting on many fronts," said Frederic Ducrozet, a strategist at Pictet Wealth Management, referring partly to the trade conflict between the U.S. and China.
He said that under normal circumstances, the reaction to the dispute in the Middle East would have been confined largely to oil prices. But because of worries over global growth and the tail risk from trade negotiations, flows are being directed instead into safe assets.
"This Iran conflict is the cherry on the cake," said Ducrozet.
Nowhere has the move been more marked than in gold. The precious metal struck a six-year high of 1,438.63 on Tuesday, up a whopping 11.2% over the past month. "Safe" currencies the Japanese yen and Swiss franc are around 2.% and 2.7% higher respectively over the same period.
Ducrozet even pointed to bitcoin's resurgence -- up 40% over the last month -- as possibly partly driven by the search for alternative investments.
The promise of fresh stimulus from the world's top central banks has fuelled an all-inclusive rally in public assets, with equities and bonds rising in tandem. That is unsettling for portfolio managers who use the more typical inverse relationship between stocks and bonds to balance and insulate their funds.
The fear is that if they correlate on the way up, they will do so on the way down -- hence the search for more alternative assets to diversify portfolios.
"It seems that the world is so awash with money, that it is creating financial asset price inflation wherever you look," ING economist Robert Carnell said in a note last week. "Something is wrong here. Moreover, the likelihood that if and when this is realised, the positive correlation between all assets means that my portfolio diversification will all count for nothing is rather disturbing."
What's more, there are growing worries that central banks under pressure from politicians and markets alike are finding it harder to read the signals on inflation and growth due to the lack of visibility on policy and trade.
Federal Reserve chief Jerome Powell speaks later on Tuesday, following stinging criticism from U.S. President Donald Trump.
On Monday, Trump again criticised the Fed for not cutting interest rates fast enough saying the world's most important central bank "blew it" and didn't know what it was doing.
(Reporting by Abhinav Ramnarayan, graphic by Ritvik Carvalho; Editing by Mike Dolan and Catherine Evans) |
Why Hydratec Industries NV (AMS:HYDRA) Could Have A Place In Your Portfolio
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Hydratec Industries NV (AMS:HYDRA) is a stock with outstanding fundamental characteristics. When we build an investment case, we need to look at the stock with a holistic perspective. In the case of HYDRA, it is a highly-regarded dividend payer that has been able to sustain great financial health over the past. In the following section, I expand a bit more on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at thereport on Hydratec Industries here.
HYDRA's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that HYDRA has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. HYDRA appears to have made good use of debt, producing operating cash levels of 0.41x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
Income investors would also be happy to know that HYDRA is a great dividend company, with a current yield standing at 3.7%. HYDRA has also been regularly increasing its dividend payments to shareholders over the past decade.
For Hydratec Industries, I've put together three relevant factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for HYDRA’s future growth? Take a look at ourfree research report of analyst consensusfor HYDRA’s outlook.
2. Historical Performance: What has HYDRA's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of HYDRA? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Trelleborg AB (publ) (STO:TREL B) Insiders Increased Their Holdings
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We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares inTrelleborg AB (publ)(STO:TREL B).
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia Universitystudyfound that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
Check out our latest analysis for Trelleborg
There wasn't any very large single transaction over the last year, but we can still observe some trading.
Over the last year, we can see that insiders have bought 3500 shares worth kr544k. On the other hand they divested 1000 shares, for kr139k. In total, Trelleborg insiders bought more than they sold over the last year. The average buy price was around kr155. These transactions suggest that insiders have considered the current price of kr132 attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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.
We saw some Trelleborg insider buying shares in the last three months. In that period insiders spent kr366k on shares. On the other hand, Peter Larsson sold kr139k worth of shares. It is nice to see that insiders have bought, but the quantum isn't large enough to get us excited.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Our data suggests Trelleborg insiders own 0.09% of the company, worth about kr32m. But they may have an indirect interest through a corporate structure that we haven't picked up on. We prefer to see high levels of insider ownership.
It is good to see recent purchasing. And an analysis of the transactions over the last year also gives us confidence. Insiders likely see value in Trelleborg shares, given these transactions (along with notable insider ownership of the company). Of course,the future is what matters most. So if you are interested in Trelleborg, you should check out 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.
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. |
Is The Unite Group plc (LON:UTG) A Strong Dividend Stock?
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Is The Unite Group plc (LON:UTG) a good dividend stock? How would you know? Dividend paying companies with growing earnings can be highly rewarding in the long term. On the other hand, investors have been known to buy a stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations.
A 3.0% yield is nothing to get excited about, but investors probably think the long payment history suggests Unite Group has some staying power. Some simple research can reduce the risk of buying Unite Group for its dividend - read on to learn more.
Click the interactive chart for our full dividend analysis
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Unite Group paid out 104% of its profit as dividends, over the trailing twelve month period. Unless there are extenuating circumstances, from the perspective of an investor who hopes to own the company for many years, a payout ratio of above 100% is definitely a concern.
Another important check we do is to see if the free cash flow generated is sufficient to pay the dividend. Unite Group paid out 120% of its free cash last year. Cash flows can be lumpy, but this dividend was not well covered by cash flow. Cash is slightly more important than profit from a dividend perspective, but given Unite Group's payments were not well covered by either earnings or cash flow, we are concerned about the sustainability of this dividend.
As Unite Group's dividend was not well covered by earnings, we need to check its balance sheet for signs of financial distress. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments on debt. Essentially we check that a) a company does not have too much debt, and b) that it can afford to pay the interest. Unite Group has net debt of more than 3x its EBITDA, which is getting towards the limit of most investors' comfort zones. Judicious use of debt can enhance shareholder returns, but also adds to the risk if something goes awry.
We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. Net interest cover of 7.89 times its interest expense appears reasonable for Unite Group, although we're conscious that even high interest cover doesn't make a company bulletproof.
We update our data on Unite Group every 24 hours, so you can always getour latest analysis of its financial health, here.
Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. For the purpose of this article, we only scrutinise the last decade of Unite Group's dividend payments. Its dividend payments have fallen by 20% or more on at least one occasion over the past ten years. During the past ten-year period, the first annual payment was UK£0.025 in 2009, compared to UK£0.29 last year. This works out to be a compound annual growth rate (CAGR) of approximately 28% a year over that time. Unite Group's dividend payments have fluctuated, so it hasn't grown 28% every year, but the CAGR is a useful rule of thumb for approximating the historical growth.
Unite Group has grown distributions at a rapid rate despite cutting the dividend at least once in the past. Companies that cut once often cut again, but it might be worth considering if the business has turned a corner.
With a relatively unstable dividend, it's even more important to evaluate if earnings per share (EPS) are growing - it's not worth taking the risk on a dividend getting cut, unless you might be rewarded with larger dividends in future. Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Unite Group has grown its earnings per share at 15% per annum over the past five years. While EPS are growing rapidly, Unite Group paid out a very high 104% of its income as dividends. If earnings continue to grow, this dividend may be sustainable, but we think a payout this high definitely bears watching.
We'd also point out that Unite Group issued a meaningful number of new shares in the past year. Trying to grow the dividend when issuing new shares reminds us of the ancient Greek tale of Sisyphus - perpetually pushing a boulder uphill. Companies that consistently issue new shares are often suboptimal from a dividend perspective.
Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. It's a concern to see that the company paid out such a high percentage of its earnings and cashflow as dividends. We were also glad to see it growing earnings, but it was concerning to see the dividend has been cut at least once in the past. In summary, Unite Group has a number of shortcomings that we'd find it hard to get past. Things could change, but we think there are likely more attractive alternatives out there.
Now, if you want to look closer, it would be worth checking out ourfreeresearch on Unite Groupmanagement tenure, salary, and performance.
We have also put together alist of global stocks with a market capitalisation above $1bn and yielding more 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
The Grace Wine Holdings (HKG:8146) Share Price Is Down 49% So Some Shareholders Are Getting Worried
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The simplest way to benefit from a rising market is to buy an index fund. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. Unfortunately theGrace Wine Holdings Limited(HKG:8146) share price slid 49% over twelve months. That falls noticeably short of the market return of around -2.7%. We wouldn't rush to judgement on Grace Wine Holdings because we don't have a long term history to look at. There was little comfort for shareholders in the last week as the price declined a further 1.9%.
See our latest analysis for Grace Wine Holdings
In his essayThe Superinvestors of Graham-and-DoddsvilleWarren Buffett described how share prices do not always rationally reflect the value of a business. 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.
Even though the Grace Wine Holdings share price is down over the year, its EPS actually improved. It could be that the share price was previously over-hyped. It's surprising to see the share price fall so much, despite the improved EPS. So it's well worth checking out some other metrics, too.
In contrast, the 14% drop in revenue is a real concern. Many investors see falling revenue as a likely precursor to lower earnings, so this could well explain the weak share price.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
If you are thinking of buying or selling Grace Wine Holdings stock, you should check out thisFREEdetailed report on its balance sheet.
We doubt Grace Wine Holdings shareholders are happy with the loss of 49% over twelve months. That falls short of the market, which lost 2.7%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. With the stock down 3.6% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. Most investors take the time to check the data on insider transactions. You canclick here to see if insiders have been buying or selling.
But note:Grace Wine Holdings may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Is Vastned Retail N.V.'s (AMS:VASTN) 7.4% Dividend Worth Your Time?
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Could Vastned Retail N.V. (AMS:VASTN) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. On the other hand, investors have been known to buy a stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations.
A high yield and a long history of paying dividends is an appealing combination for Vastned Retail. It would not be a surprise to discover that many investors buy it for the dividends. The company also bought back stock equivalent to around 2.0% of market capitalisation this year. Some simple analysis can reduce the risk of holding Vastned Retail for its dividend, and we'll focus on the most important aspects below.
Click the interactive chart for our full dividend analysis
Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. In the last year, Vastned Retail paid out 94% of its profit as dividends. It's paying out most of its earnings, which limits the amount that can be reinvested in the business. This may indicate limited need for further capital within the business, or highlight a commitment to paying a dividend.
Another important check we do is to see if the free cash flow generated is sufficient to pay the dividend. The company paid out 94% of its free cash flow as dividends last year, which is adequate, but reduces the wriggle room in the event of a downturn. It's positive to see that Vastned Retail's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut.
We update our data on Vastned Retail every 24 hours, so you can always getour latest analysis of its financial health, here.
From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. For the purpose of this article, we only scrutinise the last decade of Vastned Retail's dividend payments. This dividend has been unstable, which we define as having fallen by at least 20% one or more times over this time. During the past ten-year period, the first annual payment was €3.92 in 2009, compared to €2.05 last year. The dividend has shrunk at around 6.3% a year during that period. Vastned Retail's dividend hasn't shrunk linearly at 6.3% per annum, but the CAGR is a useful estimate of the historical rate of change.
When a company's per-share dividend falls we question if this reflects poorly on either the business or management. Either way, we find it hard to get excited about a company with a declining dividend.
Given that dividend payments have been shrinking like a glacier in a warming world, we need to check if there are some bright spots on the horizon. It's good to see Vastned Retail has been growing its earnings per share at 48% a year over the past 5 years. The company pays out most of its earnings as dividends, although with such rapid EPS growth, its possible the dividend is better covered than it looks. Still, we'd be cautious about extrapolating high growth too far out into the future.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Vastned Retail's is paying out more than half its income as dividends, but at least the dividend is covered by both reported earnings and cashflow. We were also glad to see it growing earnings, but it was concerning to see the dividend has been cut at least once in the past. Ultimately, Vastned Retail comes up short on our dividend analysis. It's not that we think it is a bad company - just that there are likely more appealing dividend prospects out there on this analysis.
Earnings growth generally bodes well for the future value of company dividend payments. See if the 3 Vastned Retail analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why Fosun International Limited (HKG:656) Could Be Your Next Investment
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Fosun International Limited (HKG:656) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of 656, it is a well-regarded dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. In the following section, I expand a bit more on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the fullreport on Fosun International here.
656's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of 656's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Compared to the rest of the industrials industry, 656 is also trading below its peers, relative to earnings generated. This supports the theory that 656 is potentially underpriced.
656 is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For Fosun International, I've put together three pertinent factors you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for 656’s future growth? Take a look at ourfree research report of analyst consensusfor 656’s outlook.
2. Historical Performance: What has 656's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of 656? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
2 Upgrades for Deere; What’s the Story?
The short answer: China, corn, and rain.
After dropping 19% in the first two weeks of May, stock inDeere & Co.(DE) has been gaining on an unusual combination of factors. The resumption of trade talks between the US and China, a spike in the price of corn, and unseasonably poor weather in the rich farm belt of the Midwest have all come together and boosted a company that had been having trouble gaining traction. Deere is on an upward trajectory now, having gained 23% since May 17.
This is the one that’s been getting all the headlines. The ongoing dispute between the US and China has seen both sides initiate protective tariffs and threaten more drastic actions, and global financial markets and trading networks have been feeling the pressure. That pressure has eased in recent days, however, as Presidents Trump and Xi have agreed to meet personally at the upcoming G20 summit.
Both leaders are expressing optimism ahead of the meeting. President Trump has said, “I think we have a chance. I know that China wants to make a deal,” while Xi has added, “The key is to show consideration to each other’s legitimate concerns.” The upbeat talk from the Presidents has buoyed markets in recent sessions.
In the last week Deere has gained from the happy talk on trade, but the stock’s run up began several weeks earlier. Shares in Deere have been on an upward trajectory since bottoming out on May 17.
And now we get to corn and rain. The weather in the Midwest has been unusually cold this year. There are snow warnings in the Colorado Rockies, as low down as 9,000 feet, while heavy rains and cold snaps have delayed the planting season in the nation’s most productive farming regions. The delays have lowered forecasts for the 2019 harvests and tightened the worldwide crop supply. At the same time, demand remains high. The predictable result is higher agricultural prices.
The most immediate gainer there is corn. Corn bottomed out on May 10 and has risen 31% since then to reach a five-year high. Wheat is also up, having gained 29% since May 10, although it has not reached record levels.
Notice the dates – corn and wheat both started rising just seven days before the price of Deere’s stock started climbing. The rising prices assured farmers that they would not be financially ruined by the looming bad season, and they began making needed investments in equipment purchases and maintenance. Deere is a direct beneficiary of those investments, and the stock price reflects it.
Josh Brown, CEO of Ritholtz Wealth Management, agrees that Deere is gaining more from corn than easing trade tensions. He points out, “If you take a look at the chart, Deere started to break out in the middle of May. It stopped trading on tariff headlines, started trading on corn prices which are now going up.”
Wall Street’s analysts have taken note – a 23% gain in a lagging industrial stock is sure-fire attention-getter. Writing from Baird on June 16,Mircea Dobresums up the support for DE shares: “Corn has rallied sharply breaking out of a five-year range as persistent wetness has raised supply concerns. Prices seem poised to move higher; this helps farm economics which should drive equipment demand.” In line with his optimistic comment, Dobre upgraded DE shares to a ‘Buy’ rating.
To go along with his upbeat outlook, he also raised his price target by 35%, to $175. That may turn out to be too low, however, as DE’s price has already run up to $166. Dobre’s target gives the stock a 4.8% potential upside.
Five-star analystStephen Volkmann, of Jefferies, has also upgraded DE, moving the stock from ‘Hold’ to ‘Buy.’ He cites the tighter crop supplies in the global market and consequent higher prices in support of his upgrade, saying, “Positive momentum in farmer net income support double-digit large equipment growth through 2020.”
Elaborating on the improved outlook for farmers, Volkmann said in a June 24 note, “We believe farm fundamentals are finally turning. A tightened global crop supply demand balance and positive momentum in farmer net income support double-digit large equipment growth through 2020.” Volkmann’s price target, $190, indicates room for a 14% upside.
Overall, Deere has a ‘Moderate Buy’ rating from the analyst consensus, based on 9 buys, 3 holds, and 1 sell assigned in the past three months. These ratings still partially reflect the more downbeat outlook that prevailed in the early part of May; the higher price targets and ratings upgrades that are now starting to come in have not had time to fully reflect in the aggregate ratings. The same effect is visible in the price target. The average PT of $163 still includes lower values assigned in past weeks; since then, the stock has risen fast and now trades for $166. If current trends hold, expect the price target to adjust as analysts reevaluate the stock. |
The Crypto Daily – The Movers and Shakers 26/06/19
Bitcoin rallied by 6.03% on Tuesday. Following on from a 1.47% gain from Monday, Bitcoin ended the day at $11,737.00.
A bullish start to the day saw Bitcoin rise from a morning low $11,028.0 to a high $11,519.0.
Bitcoin broke through the first major resistance level at $11,283.33 and second major resistance level at $11,497.67.
A late morning sell-off saw Bitcoin slide to an intraday low $10,802.0 before finding support.
Steering clear of the first major support level at $10,707.33, Bitcoin rallied to a late intraday high and new swing hi $11,780.
Bitcoin broke back through the first major resistance level at $11,283.33 and second major resistance level at $11,497.67.
Across the rest of the top 10 cryptos, it was a mixed bag for the rest of the pack.
Joining Bitcoin in the green on the day were Ethereum and Litecoin, with gains of 1.8% and 0.13% respectively.
It was red for the rest of the top 10. Leading the way down were Binance Coin and Stellar’s Lumen. The pair fell by 4.4% and 3.5% respectively.
EOS and Ripple’s XRP fell by 1.87% and 1.81%, while Bitcoin Cash ABC and Bitcoin Cash SV fell by just 0.63% and 0.17% respectively.
The moves through Tuesday sawBitcoin’s dominancebreak through to 60% levels for the first time since April 2017.
Bitcoin also drove the total crypto market cap to $336.68bn on the day, up from $330.43bn on Monday.
In spite of the Bitcoin rally, 24-hour trading volumes held relatively steady, rising from $70.15bn to $71.9bn levels on the day.
At the time of writing, Bitcoin was up by 6.1% to $12,453.0. A particularly bullish start to the day saw Bitcoin rally from a morning low $11,684.5 to a high $12,945.0.
The early morning rally saw Bitcoin break through the first major resistance level at $12,077.33 and second resistance level at $12,417.67.
From the rest of the top 10, Litecoin and EOS struggled through the morning. At the time of writing, the pair were down by 1% and by 0.12% respectively.
It was bullish for the rest of the pack. Coming in a distant second behind Bitcoin was Ethereum, which was up by 3.74%. Stellar’s Lumen also found support, rising by 2.2%, with Binance Coin up by 1.22%.
The broad-based crypto rally added $25bn to the total market cap, with the market cap sitting at $361.25bn. Trading volumes were also up from $72bn levels to $94bn levels.
Bitcoin would need to hold above the second major resistance level at $12,417.67 to support another run at $13,000 levels.
While we can expect Bitcoin to face plenty of resistance at $13,000 levels, Bitcoin could take a run at the third major resistance level at $13,395.67.
Bitcoin would need support from the broader market, however, to break out from the morning high $12,945.0.
Failure to hold above the second major resistance level at $12,417.67 could see Bitcoin give up some of the morning gains.
A pullback through to $12,300 levels could see Bitcoin fall back through the first major resistance level at $12,077.33.
Barring a broad-based crypto sell-off, Bitcoin should avoid a return to sub-$12,000 levels on the day.
Get Into Cryptocurrency Trading Today
Thisarticlewas originally posted on FX Empire
• Gold Clearly Reverses at Consolidation’s Upper Border
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• The Crypto Daily – The Movers and Shakers 27/06/19
• Traders Managing Exposures Ahead of The G20 Summit
• European Equities: It’s the Eve of the G20 Summit… |
Pharnext Announces the Apppointment of Peter Collum as Chief Financial Officer and Chief Business Officer
PARIS, FRANCE / ACCESSWIRE / June 26, 2019 /Pharnext SA(FR0011191287 - ALPHA), a biopharmaceutical company pioneering a new approach to developing innovative drug combinations based on genomic big data and artificial intelligence, today announced the appointment of Peter Collum as Chief Financial Officer and Chief Business Officer.
"We are very excited to welcome Peter to our team,"saidDaniel Cohen, M.D., Ph.D., Pharnext's Co-Founder and Chief Executive Officer."Peter's deep financial acumen alongside his in-depth business development expertise will make him a great asset to our team. We look forward toPeter's insights and contributions as we progress ourPLEOTHERAPY(TM) programs through late-stage development".
Mr. Collum joins Pharnext with over 17 years of experience in healthcare investment banking, focused on M&A, financing and business development transactions. Prior to joining Pharnext, Mr. Collum was a Partner at MTS Health Partners, a boutique healthcare investment bank in New York, NY, where he worked closely with Pharnext for almost 5 years and is well versed with its financial, technological,R & Dand regulatory aspects. During his 10 years at the firm, Mr. Collum led and participated in numerous M&A and financing deals for public and private life sciences companies both in the US and abroad. Previously, he worked in the healthcare investment banking group at Bank of America, with a focus on life sciences. Mr. Collum started his career at Roche as an engineer. He holds an M.B.A. from the Booth School of Business at the University of Chicago and a B.S. from Rutgers University College of Engineering.
"It's an incredible opportunity to join Pharnext at such an exciting time," said Mr. Collum. "PLEOTHERAPY discovery platform has great potential across a range of rare and common diseases, and I look forward to joining the executive team as Pharnext continues to grow as a biopharma company."
About Pharnext
Pharnext is an advanced clinical-stage biopharmaceutical company developingnovel therapeuticsfor orphan and common neurodegenerative diseases that currently lack curative and/or disease-modifying treatments. Pharnext has two lead products in clinical development. PXT3003 completed an international Phase 3 trial with positive topline results for the treatment of Charcot-Marie-Tooth disease type 1A and benefits from orphan drug status in Europe and the United States. PXT864 has generated encouraging Phase 2 results in Alzheimer's disease. Pharnext has developed a new drug discovery paradigm based on big genomic data and artificial intelligence: PLEOTHERAPY. Pharnext identifies and develops synergic combinations of drugs called PLEODRUG. The Company was founded by renowned scientists and entrepreneurs including Professor Daniel Cohen, a pioneer in modern genomics, and is supported by a world-class scientific team.
Pharnext is listed on the Euronext Growth Stock Exchange in Paris (ISIN code: FR0011191287).
For more information, visitwww.pharnext.com
CONTACTS
PharnextXavier PaoliChief Commercial Officercontact@pharnext.com+33 (0)1 41 09 22 30
Financial Communication (France)ActifinStéphane Ruizsruiz@actifin.fr+33 (0)1 56 88 11 15
Investor Relations (U.S.)Stern Investor Relations, Inc.Jane UrheimJane.urheim@sternir.com+1 212 362 1200
Investor Relations (Europe)MC Services AGAnne Henneckeanne.hennecke@mc-services.eu+49 211 529252 22
Media Relations (Europe)Ulysse CommunicationBruno Arabianbarabian@ulysse-communication.com+33 (0)1 81 70 96 30
Media Relations (U.S.)RooneyPartnersKate L. Barrettekbarrette@rooneyco.com+1 212 223 0561
Disclaimer
This press release contains certain forward-looking statements concerning Pharnext and its business. Such forward-looking statements are based on assumptions that Pharnext considers to be reasonable. However, there can be no assurance that the estimates contained in such forward-looking statements will be verified, which estimates are subject to numerous risks including the risks set forth in Pharnext's document de base filed with the AMF on June 2, 2016 under number I.016-0050 as well as in any other periodic report and in any other press release (a copy of which is available on www.pharnext.com) and to the development of economic conditions, financial markets and the markets in which Pharnext operates. The forward-looking statements contained in this press release are also subject to risks not yet known to Pharnext or not currently considered material by Pharnext. The occurrence of all or part of such risks could cause actual results, financial conditions, performance or achievements of Pharnext to be materially different from such forward-looking statements. Pharnext disclaims any intention or obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.
This press release and the information that it contains do not constitute an offer to sell or subscribe for, or a solicitation of an offer to purchase or subscribe for, Pharnext shares in any country.
SOURCE:PharnextView source version on accesswire.com:https://www.accesswire.com/549938/Pharnext-Announces-the-Apppointment-of-Peter-Collum-as-Chief-Financial-Officer-and-Chief-Business-Officer |
'Songland's' Shane McAnally jokes: 'My name isn't George and I'm not straight!'
NBCs fascinating new talent competition Songland , the brainchild of executive producers Adam Levine and the Eurythmics Dave Stewart, puts the focus on composers instead of performers. And in the process, the show is not only making stars out of contestants submitting songs for stars like this weeks guest, Meghan Trainor, but its increasing the public profiles for judges Ester Dean and Shane McAnally who are huge names in the industry, but arent necessarily well-known by the average television viewer. McAnally, who moved from the tiny Texas town of Mineral Wells to Branson at age 15 and then to Nashville at 19, certainly got in the best made-for-TV zinger of Tuesdays Songland episode, when he and Dean were discussing their largely behind-the-scenes careers. I was relieved when I find out [songwriting] was a job, because I thought you had to be George Strait to go to Nashville, said McAnally, and the truth is, my name isnt George and I wasnt straight! McAnally released only one solo album, a self-titled effort that received mixed reviews and yielded three moderately successful singles that cracked the top 50 of the Billboard Hot Country Songs chart around 1999/2000. But he is now one of the most successful country songwriters of all time, with a multi-page résumé that includes credits for pretty much every major name in Nashville, including Miranda Lambert, Florida Georgia Line, Carrie Underwood, Maren Morris, Keith Urban, Kelly Clarkson, Blake Shelton, Dan + Shay, and most notably Kacey Musgraves, whose Follow Your Arrow featured the inclusive line kiss lots of boys, or kiss lots of girls, if thats what youre into. And McAnally has done all this as an openly gay man in a historically conservative genre/scene, which why he landed on Rolling Stone s recent Musics Unsung LGBTQ Heroes list next to Frankie Knuckles, Judas Priests Rob Halford, and Big Freedia. Shane McAnally on 'Songland.' (Photo: Trae Patton/NBC/NBCU Photo Bank/NBCU Photo Bank) McAnally shares a country pedigree with Trainor who some may not know got her start penning songs for the likes of Rascal Flatts and Hunter Hayes though on Songland he glowingly praised Trainor for being a complete-package artist who can sing, dance, and write for both herself and others. But surely any aspiring songwriter on Songland , like this weeks four hopefuls, would be happy to have a career like McAnallys or Trainors. While the one country-leaning songwriter of Tuesdays bunch, Southern gentleman Zachary Kale, was passed over because his sentimental All Over Again was too cute and bouncy (and because newlywed Trainor apparently already has enough love songs set aside for her forthcoming third album), the three other contenders came with the sassy power anthems that Trainor was searching for. Story continues First up was Atlantas jovial, starstruck Brandin Jay with No Money Alright, a song about being broke but happy that evoked the old-soul style of CeeLo Greens F*** You or Trainors own duet with Charlie Puth, Marvin Gaye. Trainor loved the feelgood gospel outro and told Jay he was born to do this, but she struggled with how dated the song felt. (I honestly believe Brandin, whom third judge Ryan Tedder said emanated joy, was just too adorable and likable for Trainor to turn him down.) View this post on Instagram A post shared by Songland (@nbcsongland) on Jun 24, 2019 at 10:20am PDT Read more from Yahoo Entertainment: A 'Songland' explainer: Why this new talent show is 'Shark Tank' for songwriters A progressive twist: Country star Kelsea Ballerini picks R&B tune on Songland will.i.am just cant get enough of 'Songland,' picks 3 winning songs for Black Eyed Peas album Happiness begins: Jonas Brothers give recovering addict Able Heart his big break on 'Songland' Adam Levine abruptly, mysteriously leaves 'The Voice' after 16 controversial seasons Follow Lyndsey on Facebook , Twitter , Instagram , Amazon , Spotify. Want daily pop culture news delivered to your inbox? Sign up here for Yahoo Entertainment & Lifestyles newsletter. |
Why I Like Compagnie Générale des Établissements Michelin (EPA:ML)
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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Compagnie Générale des Établissements Michelin (EPA:ML), it is a dependable dividend-paying company that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at thereport on Compagnie Générale des Établissements Michelin here.
ML's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This suggests prudent control over cash and cost by management, which is an important determinant of the company’s health. ML seems to have put its debt to good use, generating operating cash levels of 0.46x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.
Income investors would also be happy to know that ML is a great dividend company, with a current yield standing at 3.4%. ML has also been regularly increasing its dividend payments to shareholders over the past decade.
For Compagnie Générale des Établissements Michelin, there are three essential aspects you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for ML’s future growth? Take a look at ourfree research report of analyst consensusfor ML’s outlook.
2. Historical Performance: What has ML's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of ML? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Holding Qingling Motors Co., Ltd. (HKG:1122)?
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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Qingling Motors Co., Ltd. (HKG:1122), it is a highly-regarded dividend payer that has been able to sustain great financial health over the past. Below, I've touched on some key aspects you should know on a high level. For those interested in understanding where the figures come from and want to see the analysis, read the fullreport on Qingling Motors here.
1122's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that 1122 has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. 1122 currently has no debt on its balance sheet. It has only utilized funding from its equity capital to run the business, which is typically normal for a small-cap company. Therefore the company has plenty of headroom to grow, and the ability to raise debt should it need to in the future.
For those seeking income streams from their portfolio, 1122 is a robust dividend payer as well. Over the past decade, the company has consistently increased its dividend payout, reaching a yield of 9.1%, making it one of the best dividend companies in the market.
For Qingling Motors, I've put together three key aspects you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for 1122’s future growth? Take a look at ourfree research report of analyst consensusfor 1122’s outlook.
2. Historical Performance: What has 1122's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of 1122? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Did You Manage To Avoid Shineroad International Holdings's (HKG:1587) 14% 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. But if you buy individual stocks, you can do both better or worse than that. Investors inShineroad International Holdings Limited(HKG:1587) have tasted that bitter downside in the last year, as the share price dropped 14%. That's well bellow the market return of -2.7%. Shineroad International Holdings hasn't been listed for long, so although we're wary of recent listings that perform poorly, it may still prove itself with time.
Check out our latest analysis for Shineroad International Holdings
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
Unfortunately Shineroad International Holdings reported an EPS drop of 12% for the last year. We note that the 14% share price drop is very close to the EPS drop. So it seems that the market sentiment has not changed much, despite the weak results. Instead, the change in the share price seems to reduction in earnings per share, alone.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
It might be well worthwhile taking a look at ourfreereport on Shineroad International Holdings's earnings, revenue and cash flow.
Shineroad International Holdings shareholders are down 14% for the year, even worse than the market loss of 2.7%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. Putting aside the last twelve months, it's good to see the share price has rebounded by 2.0%, in the last ninety days. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). Before deciding if you like the current share price, check how Shineroad International Holdings scores on these3 valuation metrics.
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
UK aid minister Stewart backing Hunt in race to be next PM
LONDON (Reuters) - Rory Stewart, Britain's aid minister and a former candidate to be the next prime minister, said he would now support Foreign Secretary Jeremy Hunt over favorite Boris Johnson in the race to succeed Theresa May. "I'm not a supporter of Boris and I wouldn't serve in his cabinet, so I'm supporting Jeremy Hunt," Stewart told BBC radio. Stewart was eliminated from the contest last week. "I think Jeremy Hunt would make a much better Prime Minister than Boris Johnson." Stewart added that he would vote against the government to try and prevent a no-deal Brexit but would not vote to bring down the government and trigger a general election. (Reporting by Alistair Smout; editing by Kate Holton) |
Did Changing Sentiment Drive Shanshan Brand Management's (HKG:1749) Share Price Down A Worrying 69%?
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The nature of investing is that you win some, and you lose some. Anyone who heldShanshan Brand Management Co., Ltd.(HKG:1749) over the last year knows what a loser feels like. The share price is down a hefty 69% in that time. We wouldn't rush to judgement on Shanshan Brand Management because we don't have a long term history to look at. Shareholders have had an even rougher run lately, with the share price down 29% in the last 90 days.
View our latest analysis for Shanshan Brand Management
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
Unfortunately Shanshan Brand Management reported an EPS drop of 31% for the last year. This reduction in EPS is not as bad as the 69% share price fall. Unsurprisingly, given the lack of EPS growth, the market seems to be more cautious about the stock. The less favorable sentiment is reflected in its current P/E ratio of 3.08.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
Thisfreeinteractive report on Shanshan Brand Management'searnings, revenue and cash flowis a great place to start, if you want to investigate the stock further.
Shanshan Brand Management shareholders are down 67% for the year (even including dividends), even worse than the market loss of 2.7%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. The share price decline has continued throughout the most recent three months, down 29%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Before forming an opinion on Shanshan Brand Management you might want to consider the cold hard cash it pays as a dividend. Thisfreechart tracks its dividend over time.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Here's Why I Think Oxley Holdings (SGX:5UX) Is An Interesting Stock
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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 Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.'
If, on the other hand, you like companies that have revenue, and even earn profits, then you may well be interested inOxley Holdings(SGX:5UX). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. While a well funded company may sustain losses for years, unless its owners have an endless appetite for subsidizing the customer, it will need to generate a profit eventually, or else breathe its last breath.
See our latest analysis for Oxley Holdings
As one of my mentors once told me, share price follows earnings per share (EPS). That means EPS growth is considered a real positive by most successful long-term investors. We can see that in the last three years Oxley Holdings grew its EPS by 13% per year. That growth rate is fairly good, assuming the company can keep it up.
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. To cut to the chase Oxley Holdings's EBIT margins dropped last year, and so did its revenue. That is, not a hint of euphemism here, suboptimal.
In the chart below, you can see how the company has grown earnings, and revenue, over time. Click on the chart to see the exact numbers.
While profitability drives the upside, prudent investors alwayscheck the balance sheet, too.
Like that fresh smell in the air when the rains are coming, insider buying fills me with optimistic anticipation. This view is based on the possibility that stock purchases signal bullishness on behalf of the buyer. However, small purchases are not always indicative of conviction, and insiders don't always get it right.
It's a pleasure to note that insiders spent S$4.5m buying Oxley Holdings shares, over the last year, without reporting any share sales whatsoever. As if for a flower bud approaching bloom, I become an expectant observer, anticipating with hope, that something splendid is coming. Zooming in, we can see that the biggest insider purchase was by Executive Chairman & CEO Chiat Kwong Ching for S$514k worth of shares, at about S$0.31 per share.
On top of the insider buying, we can also see that Oxley Holdings insiders own a large chunk of the company. In fact, they own 83% of the company, so they will share in the same delights and challenges experienced by the ordinary shareholders. To me this is a good sign because it suggests they will be incentivised to build value for shareholders over the long term. At the current share price, that insider holding is worth a whopping S$1.1b. That means they have plenty of their own capital riding on the performance of the business!
As I already mentioned, Oxley Holdings is a growing business, which is what I like to see. Better yet, insiders are significant shareholders, and have been buying more shares. That makes the company a prime candidate for my watchlist - and arguably a research priority. Now, you could try to make up your mind on Oxley Holdings by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry.
As a growth investor I do like to see insider buying. But Oxley Holdings isn't the only one. You can see aa free list of them here.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Did You Manage To Avoid Odd Molly International's (STO:ODD) Devastating 91% Share Price Drop?
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Long term investing is the way to go, but that doesn't mean you should hold every stock forever. We don't wish catastrophic capital loss on anyone. Spare a thought for those who heldOdd Molly International AB (publ)(STO:ODD) for five whole years - as the share price tanked 91%. And some of the more recent buyers are probably worried, too, with the stock falling 75% in the last year. Shareholders have had an even rougher run lately, with the share price down 56% in the last 90 days.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
View our latest analysis for Odd Molly International
Odd Molly International isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Over five years, Odd Molly International grew its revenue at 7.6% per year. That's a fairly respectable growth rate. So the stock price fall of 38% per year seems pretty steep. The truth is that the growth might be below expectations, and investors are probably worried about the continual losses.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
Balance sheet strength is crucual. It might be well worthwhile taking a look at ourfreereport on how its financial position has changed over time.
We'd be remiss not to mention the difference between Odd Molly International'stotal shareholder return(TSR) and itsshare price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Dividends have been really beneficial for Odd Molly International shareholders, and that cash payout explains why its total shareholder loss of 89%, over the last 5 years, isn't as bad as the share price return.
Investors in Odd Molly International had a tough year, with a total loss of 72%, against a market gain of about 11%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 36% over the last half decade. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You could get a better understanding of Odd Molly International's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SE exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
USD/JPY Forex Technical Analysis – June 26, 2019 Forecast
The Dollar/Yen is trading higher on Wednesday after U.S. Federal Reserve Chairman Jerome Powell dampened expectations for a potential interest rate cut. U.S. Treasury yields firmed on the comments making the U.S. Dollar a more desirable asset and tightening the spread between U.S. Government bonds and Japanese Government bonds (JGBs).
At 06:05 GMT, theUSD/JPYis trading 107.422, up 0.258 or +0.25%.
Powell shook up the financial markets on Tuesday when he said the Fed is assessing whether current economic uncertainties call for lower rates. Powell noted the Fed will take a wait-and-see approach given how rapid recent economic changes have been, but added the Fed is “insulated from short-term political interests.”
Traders read Powell’s comments as hawkish and the financial markets reversed their nearly weeklong direction to reflect this change in tone from last week’s Federal Reserve monetary policy meeting. It should be noted that the Fed never said it was cutting rates in July. However, the financial markets built in a 100% chance of a rate cut at the Fed’s July 31 meeting.
The main trend is down according to the daily swing chart. A trade through 106.775 will signal a resumption of the downtrend and put the USD/JPY back on course for a test of the March 26, 2018 main bottom at 104.600.
The main trend will change to up on a trade through 108.728. This is not likely today, but there is room for a short-term retracement of the recent selloff.
The main range is 105.180 to 112.405. Its retracement zone at 107.940 to 108.793 is resistance.
Based on the early price action, the direction of the USD/JPY on Wednesday is likely to be determined by trader reaction to the downtrending Gann angle at 107.427. This angle has been guiding the Forex pair lower since May 21.
A sustained move over 107.427 will indicate the buying is getting stronger. This could create the upside momentum needed to challenge the main Fibonacci level at 107.940. Overtaking this level could trigger an acceleration to the upside.
A sustained move under 107.427 will signal the return of sellers. They could drive the USD/JPY into a long-term uptrending angle at 107.118. If this fails then look for a test of the new minor bottom at 106.775.
Taking out 106.775 will signal a resumption of the downtrend. This could trigger a further break into the next uptrending Gann angle at 106.149. This is the last potential support angle before the 104.600 main bottom.
Another way to look at the USD/JPY: Strength over 107.427, Weakness under 107.118.
Thisarticlewas originally posted on FX Empire
• EUR/USD Daily Forecast – Euro Holding Above Major Support
• USD/CAD Daily Forecast – Pair Showing Resiliency Ahead of US Q1 GDP
• E-mini Dow Jones Industrial Average (YM) Futures Technical Analysis – June 27, 2019 Forecast
• Oil Price Fundamental Daily Forecast – Position-Trimming Likely Ahead of Trump-Xi Meeting
• Confusion Lingers Over Direction of Trade Talks as G20 Showdown Approaches
• Price of Gold Fundamental Daily Forecast – Weaker as Chances of 50bp Fed Rate Cut Fade |
The Odd Molly International (STO:ODD) Share Price Is Down 91% So Some Shareholders Are Rather Upset
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We're definitely into long term investing, but some companies are simply bad investments over any time frame. We don't wish catastrophic capital loss on anyone. Imagine if you heldOdd Molly International AB (publ)(STO:ODD) for half a decade as the share price tanked 91%. We also note that the stock has performed poorly over the last year, with the share price down 75%. Shareholders have had an even rougher run lately, with the share price down 56% in the last 90 days.
While a drop like that is definitely a body blow, money isn't as important as health and happiness.
See our latest analysis for Odd Molly International
Given that Odd Molly International didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last half decade, Odd Molly International saw its revenue increase by 7.6% per year. That's a fairly respectable growth rate. So the stock price fall of 38% per year seems pretty steep. The market can be a harsh master when your company is losing money and revenue growth disappoints.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
If you are thinking of buying or selling Odd Molly International stock, you should check out thisFREEdetailed report on its balance sheet.
We'd be remiss not to mention the difference between Odd Molly International'stotal shareholder return(TSR) and itsshare price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Odd Molly International's TSR of was a loss of 89% for the 5 years. That wasn't as bad as its share price return, because it has paid dividends.
Investors in Odd Molly International had a tough year, with a total loss of 72%, against a market gain of about 11%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 36% per year over five years. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. You could get a better understanding of Odd Molly International's growth by checking outthis more detailed historical graphof earnings, revenue and cash flow.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss thisfreelist of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SE exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
How Has Österreichische Staatsdruckerei Holding AG's (VIE:OESD) Earnings Fared Against The Long Term Trend
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Assessing Österreichische Staatsdruckerei Holding AG's (VIE:OESD) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess OESD's recent performance announced on 31 March 2019 and evaluate these figures to its long-term trend and industry movements.
View our latest analysis for Österreichische Staatsdruckerei Holding
OESD's trailing twelve-month earnings (from 31 March 2019) of €3.4m has increased by 0.8% compared to the previous year.
Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -1.1%, indicating the rate at which OESD is growing has accelerated. What's enabled this growth? Well, let’s take a look at if it is merely a result of an industry uplift, or if Österreichische Staatsdruckerei Holding has seen some company-specific growth.
In terms of returns from investment, Österreichische Staatsdruckerei Holding has fallen short of achieving a 20% return on equity (ROE), recording 15% instead. Furthermore, its return on assets (ROA) of 6.4% is below the AT Electronic industry of 6.7%, indicating Österreichische Staatsdruckerei Holding's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Österreichische Staatsdruckerei Holding’s debt level, has declined over the past 3 years from 15% to 14%.
Though Österreichische Staatsdruckerei Holding's past data is helpful, it is only one aspect of my investment thesis. Recent positive growth doesn’t necessarily mean it’s onwards and upwards for the company. There could be variables that are influencing the industry as a whole, thus the high industry growth rate over the same period of time. I recommend you continue to research Österreichische Staatsdruckerei Holding to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for OESD’s future growth? Take a look at ourfree research report of analyst consensusfor OESD’s outlook.
2. Financial Health: Are OESD’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
TechnipFMC resolves U.S. and Brazil probes, hopes to settle French case
PARIS (Reuters) - Oil services company TechnipFMC said it would pay $301.3 million to resolve anti-corruption probes with Brazilian and U.S. authorities, and added it was committed to resolving another probe on its affairs with French authorities.
TechnipFMC said in a statement published late on Tuesday that it had agreed to the resolutions with the U.S. Department of Justice (DOJ), the U.S. Securities & Exchange Commission and Brazilian authorities to resolve anti-corruption investigations in Brazil and relating to the intermediary, Unaoil.
The company agreed to pay $301.3 million to those authorities to resolve investigations into conduct dating back over a decade ago.
TechnipFMC's shares rose 1.5% in early session trading in Paris, which traders said reflected an element of relief at the fact that the company had drawn a line under those affairs.
"Today we announce the resolution of these investigations. This conduct dating back over a decade ago, taken by former employees, does not reflect the core values of our company today," said TechnipFMC chairman and CEO Doug Pferdehirt.
TechnipFMC has also been co-operating with an investigation by the French Parquet National Financier (PNF) related to historical projects in Equatorial Guinea and Ghana.
"To date, this investigation has not reached resolution. TechnipFMC remains committed to finding a resolution with the PNF and will maintain a $70 million provision related to this investigation," TechnipFMC added in a statement.
TechnipFMC was created by a large-scale merger in 2016 between French company Technip and U.S. peer FMC Technologies.
(Reporting by Sudip Kar-Gupta, Editing by Dominique Vidalon) |
A Closer Look At Viohalco S.A.'s (EBR:VIO) Uninspiring ROE
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. To keep the lesson grounded in practicality, we'll use ROE to better understand Viohalco S.A. (EBR:VIO).
Viohalco has a ROE of 6.6%, based on the last twelve months. That means that for every €1 worth of shareholders' equity, it generated €0.066 in profit.
View our latest analysis for Viohalco
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Viohalco:
6.6% = €76m ÷ €1.3b (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 the capital paid in by shareholders, plus any retained earnings. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. The higher the ROE, the more profit the company is making. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. If you look at the image below, you can see Viohalco has a lower ROE than the average (10%) in the Metals and Mining industry classification.
That's not what we like to see. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Still,shareholders might want to check if insiders have been selling.
Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the 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.
Viohalco clearly uses a significant amount of debt to boost returns, as it has a debt to equity ratio of 1.38. The company doesn't have a bad ROE, but it is less than ideal tht it has had to use debt to achieve its returns. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it.
Return on equity is one way we can compare the business quality of different companies. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. Check the past profit growth by Viohalco by looking at thisvisualization of past earnings, revenue and cash flow.
But note:Viohalco 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. |
Should You Be Concerned About Viohalco S.A.'s (EBR:VIO) 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). To keep the lesson grounded in practicality, we'll use ROE to better understand Viohalco S.A. (EBR:VIO).
Over the last twelve monthsViohalco has recorded a ROE of 6.6%. That means that for every €1 worth of shareholders' equity, it generated €0.066 in profit.
Check out our latest analysis for Viohalco
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Viohalco:
6.6% = €76m ÷ €1.3b (Based on the trailing twelve months to December 2018.)
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. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As is clear from the image below, Viohalco has a lower ROE than the average (10%) in the Metals and Mining industry.
Unfortunately, that's sub-optimal. We prefer it when the ROE of a company is above the industry average, but it's not the be-all and end-all if it is lower. Still,shareholders might want to check if insiders have been selling.
Companies usually need to invest money to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Viohalco does use a significant amount of debt to increase returns. It has a debt to equity ratio of 1.38. Its ROE isn't too bad, but it would probably be very disappointing if the company had to stop using debt. Investors should think carefully about how a company might perform if it was unable to borrow so easily, because credit markets do change over 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 when a business is high quality, the market often bids it up to a price that reflects this. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. You can see how the company has grow in the past by looking at this FREEdetailed graphof past earnings, revenue and cash flow.
Of courseViohalco may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Those Who Purchased ViroGates (CPH:VIRO) Shares A Year Ago Have A 50% Loss To Show For It
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It's easy to match the overall market return by buying an index fund. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. That downside risk was realized byViroGates A/S(CPH:VIRO) shareholders over the last year, as the share price declined 50%. That's well bellow the market return of 7.7%. Because ViroGates hasn't been listed for many years, the market is still learning about how the business performs. The good news is that the stock is up 2.3% in the last week.
Check out our latest analysis for ViroGates
We don't think ViroGates's revenue of ø3,847,401 is enough to establish significant demand. You have to wonder why venture capitalists aren't funding it. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. It seems likely some shareholders believe that ViroGates will significantly advance the business plan before too long.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. You should be aware that there is always a chance that this sort of company will need to issue more shares to raise money to continue pursuing its business plan. While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing.
ViroGates had cash in excess of all liabilities of ø53m when it last reported (March 2019). That's not too bad but management may have to think about raising capital or taking on debt, unless the company is close to breaking even. With the share price down 50% in the last year, it seems likely that the need for cash is weighing on investors' minds. The image below shows how ViroGates's balance sheet has changed over time; if you want to see the precise values, simply click on the image.
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Would it bother you if insiders were selling the stock? I'd like that just about as much as I like to drink milk and fruit juice mixed together. It only takes a moment for you tocheck whether we have identified any insider sales recently.
Given that the market gained 7.7% in the last year, ViroGates shareholders might be miffed that they lost 50%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. The share price decline has continued throughout the most recent three months, down 6.7%, suggesting an absence of enthusiasm from investors. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. Shareholders might want to examinethis detailed historical graphof past earnings, revenue and cash flow.
If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on DK 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. |
Pompeo vows cooperation with India but trade, defence issues unresolved
By Alasdair Pal and Neha Dasgupta
NEW DELHI (Reuters) - U.S. Secretary of State Mike Pompeo sought to reduce heightened trade tension with India on Wednesday, promising a renewed focus on negotiating better ties, but giving few specifics of how they would overcome disputes over trade and investment.
Pompeo's India visit comes as the two countries grapple with issues ranging from access to Indian markets for American firms to New Delhi's demand for foreign companies to store Indian data in the country, and exports of steel and aluminium to the U.S.
The two nations are "friends who can help each other all around the world," Pompeo told a joint news conference with Indian Foreign Minister Subrahmanyam Jaishankar after they met.
The current differences were expressed "in the spirit of friendship", he added.
However, any progress on trade would probably be announced at an expected meeting of Indian Prime Minister Narendra Modi and U.S. President Donald Trump at a Group of 20 (G20) summit in Japan this week, economic and political analysts said.
"If there is going to be some kind announcement on trade, it will come at a Trump-Modi meeting," said Neelam Deo, founder of the Gateway House think tank in the financial capital of Mumbai.
TRADE SPAT
The trade disputes have led to higher tariffs by the two countries and created unease over the depth of their security alliance.
In particular, the sudden introduction of new e-commerce rules for foreign investors in February angered the Americans because it showed New Delhi was prepared to move the goalposts to hurt two of the largest U.S. companies, discount retailer Walmart, and Amazon.com Inc.
Walmart last year invested $16 billion to buy control of Indian e-commerce firm Flipkart.
Just days before Pompeo's visit, India slapped higher retaliatory tariffs on 28 U.S. products following Washington's withdrawal of key trade privileges for New Delhi.
Jaishankar, a former Indian ambassador to the United States, played down the spat on Wednesday.
"If you trade with someone and they are your biggest trading partner, it is impossible you don't have trade issues," he said.
In an interview with broadcaster India Today on Wednesday night, Pompeo was asked how India could get the Generalized System of Preferences (GSP) trade programme restored.
"We are going to go work to restore these relationships. I am confident we can," Pompeo said, without providing details.
MISSILES AND OIL
India's ties with Russia and Iran, both now subject to U.S. sanctions, are also a sore point.
U.S. pressure has led India to stop buying oil from Iran, a top energy supplier.
In a policy speech hosted by the U.S. embassy on Thursday evening, Pompeo said United States will ensure India receives adequate supplies of oil as New Delhi stops buying Iranian crude in line with U.S. sanctions on Tehran. [D8N21J02N]
The United States is also lobbying India not to proceed with its purchase of S-400 surface-to-air missile systems from Russia.
The missile deal and Iranian oil were both discussed during their meeting, Jaishankar and Pompeo said, but mentioned no resolution of either at the news conference.
"On two of the biggest issues - Iran and Russia - the difference is deep," said analyst Deo, formerly a top Indian diplomat in the United States.
Areas of agreement include efforts to combat increased militant activity in the region, after deadly suicide bomb blasts in Sri Lanka in April.
Both countries have a shared foe in China, which has alarmed them with its inroads in South Asia.
Pompeo criticised China's Belt and Road Initiative, its ambitious plan to finance and build infrastructure across the globe, which some detractors have labelled a debt trap.
For smaller countries, it came "not with strings attached, but with shackles," he said.
Earlier, Pompeo met Modi for talks at the prime minister's residence in the capital, New Delhi, and they exchanged handshakes in images broadcast on television.
"The prime minister expressed his strong commitment to achieve the full potential of bilateral relations in trade and economy, energy, defence, counterterrorism and people-to-people contacts," the foreign ministry said in a statement, without elaborating.
Pompeo leaves India on Thursday morning for the summit of G20 leaders in Japan's western city of Osaka. Pompeo said Modi and Trump would be able to "build on what we talked about today" when they meet in Osaka.
(Reporting by Alasdair Pal and Neha Dasgupta; Additional reporting by Aftab Ahmed; Editing by Clarence Fernandez, Martin Howell and Toby Chopra) |
How Much is Value Management & Research AG's (FRA:VMR1) CEO Getting Paid?
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Eugen Fleck is the CEO of Value Management & Research AG (FRA:VMR1). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Value Management & Research
According to our data, Value Management & Research AG has a market capitalization of €7.2m, and pays its CEO total annual compensation worth €65k. (This is based on the year to December 2017). We think total compensation is more important but we note that the CEO salary is lower, at €52k. We took a group of companies with market capitalizations below €176m, and calculated the median CEO total compensation to be €239k.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see, below, how CEO compensation at Value Management & Research has changed over time.
On average over the last three years, Value Management & Research AG has grown earnings per share (EPS) by 31% each year (using a line of best fit). It achieved revenue growth of 8.3% over the last year.
This shows that the company has improved itself over the last few years. Good news for shareholders. It's nice to see a little revenue growth, as this is consistent with healthy business conditions. We don't have analyst forecasts, but you might want to assessthis data-rich visualizationof earnings, revenue and cash flow.
Given the total loss of 3.7% over three years, many shareholders in Value Management & Research AG are probably rather dissatisfied, to say the least. It therefore might be upsetting for shareholders if the CEO were paid generously.
Value Management & Research AG is currently paying its CEO below what is normal for companies of its size. Since the business is growing, many would argue this suggests the pay is modest. Unfortunately, some shareholders may be disappointed with their returns, given the company's performance over the last three years. We're not critical of the remuneration Eugen Fleck receives, but it would be good to see improved returns to shareholders before the remuneration grows too much.
In this case we may want to look deeper into the company. There are some real positives and we could see improved returns in the longer term. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Value Management & Research (free visualization of insider trades).
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Stocks - Futures Surge as Mnuchin says U.S.-China Trade Deal ‘90% Complete’
Investing.com - U.S. futures surged on Wednesday after Treasury Secretary Steve Mnuchin said the U.S.-China trade deal is "90% complete”.
His comments boosted hopes that U.S. President Donald Trump and Chinese President Xi Jinping will avoid escalating their dispute over trade and, ultimately, global economic power when they meet on Saturday on the sidelines of the G20 summit.
Tech-heavy Nasdaq 100 futures jumped 54 points or 0.7% by 6:44 AM ET (10:44 GMT), while Dow futures was up 110 points or 0.4% and S&P 500 futures gained 13 points or 0.5%.
Wall Street slumped on Tuesday after Federal Reserve Chair Jerome Powell and St. Louis Fed President James Bullard downplayed the chances of a large rate cut in July. Powell said the central bank will be patient on its approach to rate cuts, while Bullard pointed to a smaller rate cut than the 50 basis points that some had hoped for.
Semiconductor company Micron (NASDAQ:MU) jumped 9.9% after its earnings beat expectations and it said that it was still able to export certain products to China, despite the White House ban on American companies doing business with Huawei and other companies.
FedEx (NYSE:FDX) rose 1.2% after it reported better-than-expected earnings for the fiscal fourth-quarter, while Chinese giant Alibaba (NYSE:BABA) gained 1.8% and Facebook (NASDAQ:FB) was up 1%.
AbbVie (NYSE:ABBV) bounced back 2.1% after falling 16% on Tuesday on what was seen as an expensive acquisition offer for Botox-maker Allergan (NYSE:AGN).
Tesla (NASDAQ:TSLA) inched down 0.1% afteryet another executiveleft the company.
On the economic front,durable goods ordersare out at 8:30 AM ET (12:30 GMT).
In commodities, crude oil rose 1.6% to $58.76 a barrel, on course for its fourth rise in five days after signs that the summer driving season is finally eating into U.S. crude inventories. Gold futures slipped 0.6% to $1,410.85 a troy ounce, meanwhile, in reaction to the comments from Fed officials. The U.S. dollar index, which measures the greenback against a basket of six major currencies, inched up 0.1% to 95.732.
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Why We’re Not Keen On Slitevind AB’s (STO:SLITE) 4.1% Return On Capital
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Today we are going to look at Slitevind AB (STO:SLITE) to see whether it might be an attractive investment prospect. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires.
Firstly, we'll go over how we calculate ROCE. Then we'll compare its ROCE to similar companies. Last but not least, we'll look at what impact its current liabilities have on its ROCE.
ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
The formula for calculating the return on capital employed is:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Slitevind:
0.041 = kr23m ÷ (kr629m - kr60m) (Based on the trailing twelve months to March 2019.)
Therefore,Slitevind has an ROCE of 4.1%.
Check out our latest analysis for Slitevind
ROCE is commonly used for comparing the performance of similar businesses. We can see Slitevind's ROCE is meaningfully below the Renewable Energy industry average of 5.4%. This performance could be negative if sustained, as it suggests the business may underperform its industry. Setting aside the industry comparison for now, Slitevind's ROCE is mediocre in absolute terms, considering the risk of investing in stocks versus the safety of a bank account. Investors may wish to consider higher-performing investments.
Slitevind delivered an ROCE of 4.1%, which is better than 3 years ago, as was making losses back then. This makes us wonder if the company is improving.
When considering ROCE, bear in mind that it reflects the past and does not necessarily predict the future. ROCE can be misleading for companies in cyclical industries, with returns looking impressive during the boom times, but very weak during the busts. ROCE is, after all, simply a snap shot of a single year. You can check if Slitevind has cyclical profits by looking at thisfreegraph of past earnings, revenue and cash flow.
Current liabilities are short term bills and invoices that need to be paid in 12 months or less. Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual. To counter this, investors can check if a company has high current liabilities relative to total assets.
Slitevind has total assets of kr629m and current liabilities of kr60m. Therefore its current liabilities are equivalent to approximately 9.6% of its total assets. Slitevind has a low level of current liabilities, which have a minimal impact on its uninspiring ROCE.
If performance improves, then Slitevind may be an OK investment, especially at the right valuation. You might be able to find a better investment than Slitevind. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).
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. |
Should You Be Holding Vocento, S.A. (BME:VOC)?
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I've been keeping an eye on Vocento, S.A. (BME:VOC) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe VOC has a lot to offer. Basically, it is a financially-healthy company with a an impressive track record of performance, trading at a discount. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at thereport on Vocento here.
Over the past few years, VOC has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. In addition to beating its historical values, VOC also outperformed its industry, which delivered a growth of 5.3%. This is an optimistic signal for the future. With a debt-to-equity ratio of 26%, VOC’s debt level is reasonable. This indicates a good balance between taking advantage of low cost funding through debt financing, but having enough financial flexibility and headroom to grow debt in the future. VOC's has produced operating cash levels of 0.57x total debt over the past year, which implies that VOC's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
VOC's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. According to my intrinsic value of the stock, which is driven by analyst consensus forecast of VOC's earnings, investors now have the opportunity to buy into the stock to reap capital gains. Also, relative to the rest of its peers with similar levels of earnings, VOC's share price is trading below the group's average. This further reaffirms that VOC is potentially undervalued.
For Vocento, I've put together three relevant factors you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for VOC’s future growth? Take a look at ourfree research report of analyst consensusfor VOC’s outlook.
2. Dividend Income vs Capital Gains: Does VOC return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Ourhistorical dividend yield visualizationquickly tells you what your can expect from VOC as an investment.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of VOC? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why Surteco Group SE (ETR:SUR) Is An Attractive Investment To Consider
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Attractive stocks have exceptional fundamentals. In the case of Surteco Group SE (ETR:SUR), there's is a dependable dividend-paying company that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the fullreport on Surteco Group here.
SUR's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that SUR has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. SUR seems to have put its debt to good use, generating operating cash levels of 0.22x total debt in the most recent year. This is also a good indication as to whether debt is properly covered by the company’s cash flows.
Income investors would also be happy to know that SUR is a great dividend company, with a current yield standing at 2.2%. SUR has also been regularly increasing its dividend payments to shareholders over the past decade.
For Surteco Group, there are three important factors you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for SUR’s future growth? Take a look at ourfree research report of analyst consensusfor SUR’s outlook.
2. Historical Performance: What has SUR's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of SUR? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Walmart aims to list minority stake in Japan unit Seiyu
TOKYO (Reuters) - Walmart said it aims to list its Japanese supermarket unit Seiyu while keeping a majority stake in the business, amid on-and-off speculation the U.S. retail giant was looking to exit Japan where it has struggled to grow.
Lionel Desclee, who was hired earlier this year as CEO of Walmart Japan, said in a speech to employees on Wednesday that Walmart would remain invested in Seiyu.
"We also have a longer-term aspiration to list a minority stake of our business in Japan," he said in a speech, according to a Walmart Japan statement.
"We believe a Japan listing would empower Seiyu to accelerate the journey of building a strong, innovative local value retailer both in-stores and online, while still enjoying the benefits of being powered by Walmart," he was also quoted as saying. No time-frame for a listing was mentioned.
Walmart first entered the Japanese market in 2002 by buying a 6 percent stake in Seiyu, and gradually built up its stake before a full takeover in 2008.
But Japan has proven a difficult market for Walmart and other foreign entrants such as Tesco PLC and Carrefour SA. Japanese media reported last year that Walmart considered selling Seiyu, and that a sale could amount to around 300 billion to 500 billion yen ($2.69 billion to $4.48 billion).
Consumers in Japan demand fresh food and efficient customer service, and the country's supermarket industry is highly competitive and its margins razor thin after years of deflation.
Judith McKenna, CEO of Walmart International, was also quoted in the statement as supporting a potential public listing of Seiyu with Walmart retaining majority ownership.
Under Walmart, Seiyu has closed unprofitable stores. It also teamed up with Rakuten Inc last year to launch an online grocery venture, facing off against rivals such as Amazon's Fresh service.
(Reporting by Ritsuko Ando and Sam Nussey; Editing by Himani Sarkar and Muralikumar Anantharaman) |
A Spotlight On Surteco Group SE's (ETR:SUR) Fundamentals
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Surteco Group SE (ETR:SUR) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of SUR, it is a well-regarded dividend payer that has been able to sustain great financial health over the past. Below is a brief commentary on these key aspects. For those interested in understanding where the figures come from and want to see the analysis, read the fullreport on Surteco Group here.
SUR's ability to maintain an adequate level of cash to meet upcoming liabilities is a good sign for its financial health. This implies that SUR manages its cash and cost levels well, which is a key determinant of the company’s health. SUR's has produced operating cash levels of 0.22x total debt over the past year, which implies that SUR's management has put its borrowings into good use by generating enough cash to cover a sufficient portion of borrowings.
SUR is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For Surteco Group, there are three fundamental factors you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for SUR’s future growth? Take a look at ourfree research report of analyst consensusfor SUR’s outlook.
2. Historical Performance: What has SUR's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of SUR? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why Do the Kardashians’ Pets Keep Mysteriously Disappearing?
Photo Illustration by The Daily Beast/social media Kim Kardashian West is many things—a reality TV icon, multimillionaire entrepreneur, prison reform activist, aspiring lawyer—but animal lover is nowhere on the list. A recent episode of Keeping Up with the Kardashians showed the mother of four dealing with the inconvenience of the death of her daughter North’s beloved hamster. The hamster, complete with a pink castle cage, was a gift from Aunt Khloé, who’d failed to impress her niece with the special day of limousine rides and ice cream she planned. The only thing that would make North happy was a tiny rodent, much to her mother’s chagrin. Disaster soon struck when one of Kim’s assistants delivered the grim news that the hamster, named Blacktail , hadn’t moved in a while. “It’s, like, stiff,” the assistant said monotonously, urging his boss to check on Blacktail. With the swish of a sleek black ponytail, Kim stood up from the kitchen table, sighing, “I don’t have time for a dead hamster.” She spent the rest of the episode fluctuating between anger toward her sister for getting North a pet without permission and emotional distress over how to teach her daughter about the circle of life. Kim decided instead to take the classic lie-to-your-children-to-protect-them route and find an identical replacement. North’s pet was a fancy bear hamster (which I learned today is the actual name of a hamster breed and not something made up by a child), dubbed the “unicorn of hamsters” by Khloé because of its rare pedigree. They found a match, successfully hoodwinked a 6-year-old, and learned they’ve been spelling “hamster” wrong their whole lives. (Hint: there is no ‘p’.) The Dangerous Kardashian Effect and the Profound Impact of the Superficial Kim Kardashian Confesses She Can’t ‘Babysit’ Kanye West Any Longer Given the family’s track record with pets, it is not all that surprising that poor Blacktail met an early end. There have been numerous articles over the years outlining the lengthy list of Kardashian-Jenner pets, including several who mysteriously disappeared after a few Instagram posts or cameos on the show. Story continues Back in 2016, Kim herself even made a post on her now-nonexistent app, a sort of “where are they now” piece detailing the fates of all of the family’s pets—or at least the ones she could remember. She was careful to clarify that she remembered “almost” all of them, meaning there have been so many that some have been forgotten. Perhaps she was going for transparency, but she mostly just succeeded at raising eyebrows over just how many pets they have seemingly abandoned. (The Kardashian team did not respond to requests for comment.) Based on Kim’s list, Keeping Up with the Kardashians clips , and years of Snapchat stories and Instagram posts, I was able to determine that since Kardashian clan hurtled into the spotlight just over a decade ago, they have owned approximately 40 pets. The extensive menagerie has included nearly two dozen dogs, a couple of cats, chickens, a peacock, and maybe a pig. According to a KUWTK deleted scene , Wilbur the teacup pig was a gift from Kris to her favorite and youngest daughter, Kylie. It is unclear if she kept Wilbur, but he did go on to be a Vine star when the hilarious clip of the makeup mogul mistaking him for a chicken went viral. The Wilbur anecdote is one of the more harmless of the unsolved pet mysteries, since it was never officially confirmed whether or not he became a permanent part of the family. In addition to Blacktail, at least three other family pets have died. Kim’s white Persian kitten Mercy, a gift from Kanye West, died unexpectedly in 2012 of something Kim vaguely described as a “cancer-like virus.” Dolce the Chihuahua, one of the OG Kar-Jenner pets, was killed by a coyote. He is now immortalized in the form of a beige Kylie Cosmetics lip kit bearing his name. Some of the dogs that are still alive became casualties of break-ups, lost in “custody” disputes or given away after the relationships went south. And then there are the ones who vanished with no explanation: bunnies who haven’t been featured on Instagram in years, a dog who seemed to exist solely as a prop in sponsored ads for the Wag dog-walking app. It should be noted that Kylie Jenner seems to be the only devoted pet parent of the bunch, recently confirming on Twitter that she still owns all of her pets and sharing videos of them playing with her 1-year-old daughter Stormi. Disposing of pets as if they are material goods, like Kourtney giving away her pricey Bengal kitten when she gave birth to Reign or Kendall presumably parting with her Great Dane puppy because it pooped too much, is not entirely off-brand for a family as wealthy as the Kardashians . It should not have come as a surprise to Kris that Kendall, the world’s highest-paid supermodel, did not want to pick up giant dog turds. And the KUWTK producers were really underestimating their viewers when they expected us to believe that Kris, all-powerful momager that she may be, donned rubber cleaning gloves and scrubbed the black-and-white tile floor of her laundry room when Kendall wouldn’t do it. Not everyone has to be a pet person. So, given their pristine houses full of expensive white furniture and their jet-setting schedules of modelling gigs, meetings with the president, and vacations with baby daddies, why do the Kardashian-Jenners keep trying to convince the world that they are? Read more at The Daily Beast. Get our top stories in your inbox every day. Sign up now! Daily Beast Membership: Beast Inside goes deeper on the stories that matter to you. Learn more. |
A Look At Yanlord Land Group Limited's (SGX:Z25) Exceptional Fundamentals
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As an investor, I look for investments which does not compromise one fundamental factor for another. By this I mean, I look at stocks holistically, from their financial health to their future outlook. In the case of Yanlord Land Group Limited (SGX:Z25), it is a highly-regarded dividend payer that has been a rockstar for income investors, currently trading at an attractive share price. Below, I've touched on some key aspects you should know on a high level. If you're interested in understanding beyond my broad commentary, take a look at thereport on Yanlord Land Group here.
Z25's share price is trading below its true value according to its price-to-earnings ratio of 4.09x compared to its industry as well as the wider stock market, which means it is relatively cheaper than its peers.
Z25 is also a dividend company, with ample net income to cover its dividend payout, which has been consistently growing over the past decade, keeping income investors happy.
For Yanlord Land Group, I've compiled three pertinent aspects you should further research:
1. Future Outlook: What are well-informed industry analysts predicting for Z25’s future growth? Take a look at ourfree research report of analyst consensusfor Z25’s outlook.
2. Historical Performance: What has Z25's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of Z25? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Calculating The Intrinsic Value Of Enzymatica AB (STO:ENZY)
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Today we will run through one way of estimating the intrinsic value of Enzymatica AB (STO:ENZY) by taking the foreast future cash flows of the company and discounting them back to today's value. This is done using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. 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.
View our latest analysis for Enzymatica
We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. To 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": "SEK-43.45", "2020": "SEK-10.17", "2021": "SEK8.76", "2022": "SEK13.72", "2023": "SEK19.17", "2024": "SEK24.53", "2025": "SEK29.36", "2026": "SEK33.45", "2027": "SEK36.75", "2028": "SEK39.34"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x2", "2020": "Analyst x2", "2021": "Analyst x2", "2022": "Est @ 56.6%", "2023": "Est @ 39.75%", "2024": "Est @ 27.96%", "2025": "Est @ 19.7%", "2026": "Est @ 13.92%", "2027": "Est @ 9.87%", "2028": "Est @ 7.04%"}, {"": "Present Value (SEK, Millions) Discounted @ 5.2%", "2019": "SEK-41.31", "2020": "SEK-9.19", "2021": "SEK7.52", "2022": "SEK11.20", "2023": "SEK14.88", "2024": "SEK18.09", "2025": "SEK20.59", "2026": "SEK22.29", "2027": "SEK23.28", "2028": "SEK23.69"}]
Present Value of 10-year Cash Flow (PVCF)= SEK91.04m
"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 (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 5.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = kr39m × (1 + 0.4%) ÷ (5.2% – 0.4%) = kr829m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= SEKkr829m ÷ ( 1 + 5.2%)10= SEK498.99m
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is SEK590.03m. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of SEK4.13. Relative to the current share price of SEK3.77, the company appears about fair value at a 8.7% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. 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 Enzymatica 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 5.2%, which is based on a levered beta of 0.800. 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. For Enzymatica, There are three additional factors you should look at:
1. Financial Health: Does ENZY 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 ENZY'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 ENZY? 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. |
Global Change Agents: Dr Jennifer Eberhardt
Dr. Jennifer Eberhardt is one of the worlds leading experts on racial bias. The Stanford University social psychologists new book, Biased explores the science behind unconscious racial bias and provides real-world examples of how businesses, public services have addressed prejudice at their organisations. Speaking on Yahoo Finance UKs Global Change Agents with Lianna Brinded show, Eberhardt, a 2014 MacArthur Genius Award grant recipient , said she conducted her very first social psychology experiment aged just five. I just was really excited about ... turning five and had been looking forward to this for quite a while, Eberhardt said. My sister and my girlfriend next-door, they sat with me at the table and sung Happy Birthday, and we had cake, and there were candles on the cake, and so it was an incredible moment I was waiting for and I was finally there: I was finally five. But panic soon set in when a young Eberhardt realised she would turn six and couldnt stay five-years-old forever. She decided to stage an intervention: closing her eyes and promising herself she would forever remember exactly what it felt like in that moment to be five. That was my study and its funny because what I wished for actually did work: I still remember myself at five, Eberhardt said. I was on my way then to becoming a social psychologist, I think, even though I didnt know what that meant. Social psychologist Dr Jennifer Eberhardt on the "Global Change Agents with Lianna Brinded" show. Eberhardts academic trajectory really kicked into into gear when she was 12-years-old and moved from an all-black neighbourhood in Cleveland to a suburb that was majority-white. She began to notice racial disparities, such as access to resources and how few people were expected to go to college in her previous neighbourhood compared to her new one. Eberhardt also noticed that her brain found it difficult to process white peoples faces, meaning she sometimes found it hard to recognise one school friend from another. A lot of her work now focuses on the other race effect, where people are much better at recognising faces of their own race. Story continues Alongside her academic research, Eberhardt also works with companies including Nextdoor and Airbnb to help them adapt their platforms to reduce potential instances of bias. Watch the full Global Change Agents interview for: Eberhardts research exploring the fusiform face area of the brain that processes faces and how it can adapt over time How the Oakland Police Department reduced its number of traffic stops by 40% by making one small change How social network Nextdoor curbed racial profiling on its platform by 75% The research surrounding racial bias and job applications How companies can help employees mitigate their biases Eberhardts work to use artificial intelligence to help shrink workplace disparities |
Versus Systems Appoints Kurt Spenser, Co-Founder of Radley Studios and ROKA Sports, Inc. To Advisory Board
Versus adds Co-Founder of Radley Studios, Content and Design Studio, and ROKA Sports, Inc., Technical Apparel and Equipment Manufacturer as Advisor
Los Angeles, California--(Newsfile Corp. - June 26, 2019) -Versus Systems Inc.(CSE: VS) (OTCQB: VRSSF) (FSE: BMVA)("Versus")is proud to announce the appointment of Kurt Spenser, Co-Founder of Radley Studios and ROKA Sports, Inc., to the Versus Systems advisory board. Spenser is multi-discipline creative and entrepreneur who co-founded both Radley Studios and ROKA Sports, Inc.
Spenser will be advising the Versus executive team and board of directors on Versus Systems' advertising agency and brand outreach. "Kurt Spenser is a media and design expert who has worked with dozens of household brands, advertising agencies, and global entertainment networks, creating content for television and interactive media. Kurt is also a world class brand builder, co-founding ROKA - one of the most disruptive makers of eyewear and technical sports apparel in the world. I cannot wait to work with Kurt to change the advertising landscape," said Matthew Pierce, Founder and CEO of Versus Systems.
"WINFINITE is the best audience-engagement tool of the last ten years. The team at Versus has created a new paradigm that solves real problems in the current and emerging media, gaming and advertising ecosystem. Players, viewers, brands, and content providers will all benefit from a Versus platform that offers real-world value and rewards. It is the tightest integration of content to commerce possible. The potential for what Versus can do is explosive. It's an honor to work with their incredible team of executives, staff and advisors," said Kurt Spenser, Co-Founder of Radley Studios and ROKA Sports, Inc.
About Radley Studios
Radley is a full-service integrated content, design and marketing company based in Los Angeles, CA. Built on the promise of creating and delivering premium content across all platforms, Radley Studios believes that great storytelling provides solid ground to defy convention. Through disruptive technology and passionate creative, Radley Studios is committed to delivering consumers the experiences in the most engaging way. With an executive team that has directed and produced award-winning commercial and advertising campaigns, written and produced network dramas and feature films, and launched branded entertainment across all platforms, the team at Radley Studios is dedicated to playing a key role in delivering what's next for the brands, people and stories. For more information, please visitwww.radleystudios.tv.
About ROKA Sports, Inc.
ROKA was formed in a garage in Austin, Texas by two former Stanford All-American swimmers on a mission to build the world's fastest wetsuit. ROKA quickly grew to become a global performance eyewear, apparel and design company. ROKA's award-winning and patented technology has been proven at the top of the podium in the world's toughest endurance sporting events, including the Olympics, the Tour de France, the IRONMAN World Championship and the Dakar Off-Road Rally. ROKA is on a mission to take the insights it has gained from extreme performance and bring them to bear on everyday challenges. With over 30 patents and numerous others pending, ROKA is challenging the status quo and monopolistic markets with innovative design and independent insight. For more information, please visitwww.roka.com.
About Versus Systems Inc.
Versus Systems has developed WINFINITE - a proprietary in-game prizing and promotions engine that allows game publishers and developers to offer in-game prizing across various platforms including mobile, console, PC games, and streaming media. Brands pay to place products in-game via WINFINITE, and gamers compete for those prizes.For more information on Versus Systems' new platform, WINFINITE, visitwww.versussystems.comor visit Versus Systems officialYouTube channel.
For Versus Systems, contact:Matthew Piercepress@versussystems.com(424) 242-4150
The Canadian Securities Exchange does not accept responsibility for the adequacy or accuracy of this press release.
To view the source version of this press release, please visithttps://www.newsfilecorp.com/release/45875 |
Calculating The Fair Value Of Enzymatica AB (STO:ENZY)
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Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Enzymatica AB (STO:ENZY) as an investment opportunity by projecting its future cash flows and then discounting them to today's value. I will use the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
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. 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 Enzymatica
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.
Generally we assume that a dollar today is more valuable than a dollar in the future, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF (SEK, Millions)", "2019": "SEK-43.45", "2020": "SEK-10.17", "2021": "SEK8.76", "2022": "SEK13.72", "2023": "SEK19.17", "2024": "SEK24.53", "2025": "SEK29.36", "2026": "SEK33.45", "2027": "SEK36.75", "2028": "SEK39.34"}, {"": "Growth Rate Estimate Source", "2019": "Analyst x2", "2020": "Analyst x2", "2021": "Analyst x2", "2022": "Est @ 56.6%", "2023": "Est @ 39.75%", "2024": "Est @ 27.96%", "2025": "Est @ 19.7%", "2026": "Est @ 13.92%", "2027": "Est @ 9.87%", "2028": "Est @ 7.04%"}, {"": "Present Value (SEK, Millions) Discounted @ 5.2%", "2019": "SEK-41.31", "2020": "SEK-9.19", "2021": "SEK7.52", "2022": "SEK11.20", "2023": "SEK14.88", "2024": "SEK18.09", "2025": "SEK20.59", "2026": "SEK22.29", "2027": "SEK23.28", "2028": "SEK23.69"}]
Present Value of 10-year Cash Flow (PVCF)= SEK91.04m
"Est" = FCF growth rate estimated by Simply Wall St
We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. 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 5.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = kr39m × (1 + 0.4%) ÷ (5.2% – 0.4%) = kr829m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= SEKkr829m ÷ ( 1 + 5.2%)10= SEK498.99m
The total value is the sum of cash flows for the next ten years plus the discounted terminal value, which results in the Total Equity Value, which in this case is SEK590.03m. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of SEK4.13. Compared to the current share price of SEK3.77, the company appears about fair value at a 8.7% discount to where the stock price trades currently. Remember though, that this is just an approximate valuation, and like any complex formula - garbage in, garbage out.
Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Enzymatica 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 5.2%, which is based on a levered beta of 0.800. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Although the valuation of a company is important, it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Enzymatica, There are three additional factors you should further research:
1. Financial Health: Does ENZY 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 ENZY'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 ENZY? 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. |
Those Who Purchased Rosier (EBR:ENGB) Shares Five Years Ago Have A 30% Loss To Show For It
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In order to justify the effort of selecting individual stocks, it's worth striving to beat the returns from a market index fund. But even the best stock picker will only win withsomeselections. At this point some shareholders may be questioning their investment inRosier SA(EBR:ENGB), since the last five years saw the share price fall 30%. There was little comfort for shareholders in the last week as the price declined a further 2.1%.
Check out our latest analysis for Rosier
Given that Rosier didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last five years Rosier saw its revenue shrink by 8.6% per year. That puts it in an unattractive cohort, to put it mildly. It seems pretty reasonable to us that the share price dipped 6.9% per year in that time. We doubt many shareholders are delighted with this share price performance. It is possible for businesses to bounce back but as Buffett says, 'turnarounds seldom turn'.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
Balance sheet strength is crucual. It might be well worthwhile taking a look at ourfreereport on how its financial position has changed over time.
We regret to report that Rosier shareholders are down 12% for the year. Unfortunately, that's worse than the broader market decline of 4.3%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 6.9% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. You might want to assessthis data-rich visualizationof its earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on BE 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. |
Watkin Jones Plc (LON:WJG) Delivered A Better ROE Than Its Industry
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine Watkin Jones Plc (LON:WJG), by way of a worked example.
Our data showsWatkin Jones has a return on equity of 27%for the last year. One way to conceptualize this, is that for each £1 of shareholders' equity it has, the company made £0.27 in profit.
See our latest analysis for Watkin Jones
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Watkin Jones:
27% = UK£44m ÷ UK£161m (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is the capital paid in by shareholders, plus any retained earnings. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, all else being equal,a high ROE is better than a low one. 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, Watkin Jones has a better ROE than the average (9.1%) in the Real Estate industry.
That's what I like to see. We think a high ROE, alone, is usually enough to justify further research into a company. One data point to check is ifinsiders have bought shares recently.
Virtually all companies need money to invest in the business, to grow profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
While Watkin Jones does have some debt, with debt to equity of just 0.25, we wouldn't say debt is excessive. Its ROE is very impressive, and given only modest debt, this suggests the business is high quality. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is one way we can compare the business quality of different companies. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of courseWatkin Jones may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
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