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GLOBAL MARKETS-Sino-U.S. trade truce hopes rekindle risk appetite
* Europe, Asia lifts MSCI world share index after 4 down days
* Germany leads Europe, Japan, China, Hong Kong top Asia
* U.S.-China tentative agreement to trade truce - SCMP
* Market pares bets for half-point Fed rate cut in July
By Marc Jones
LONDON, June 27 (Reuters) - Risk appetite returned to world markets on Thursday following a media report the United States and China have tentatively agreed to a truce ahead of a highly-anticipated weekend meeting of the two nations' leaders in Tokyo.
The South China Morning Post (SCMP), citing sources, said Washington and Beijing were laying out an agreement that would help avert the next round of tariffs on an additional $300 billion of Chinese imports.
On Wednesday, U.S. President Donald Trump said a trade deal with his Chinese counterpart Xi Jinping was possible this weekend, though he was prepared to impose tariffs on virtually all remaining Chinese imports if talks fail.
"But the truce cake seems to have been baked," the SCMP cited one of its sources as saying.
Hopes that the world's two biggest economies would finally reach an agreement were enough to cheer investors, sending MSCI's broadest index of world shares up over 0.2% after four days of back-to-back losses.
Germany's trade-sensitive DAX led Europe's early gains with a 0.7% jump with the other main bourses and Wall Street futures all up between 0.2%-0.6%.
Asia had finished strongly with China's blue-chip index closing up 1% and Hong Kong's Hang Seng and Japan's Nikkei ending 1.4% and 1.2% higher.
"The market is focusing on the hope that there will be a trade truce (between the U.S. and China)," said ING's chief EMEA FX and rates strategist Petr Krpata.
"We still think though that it would be temporary and that things will get worse again over the summer before they get better."
The trade row has already rattled investors who have ditched shares for the safety of bonds and gold this year. It has also prompted the U.S. Federal Reserve to shift 180 degrees from raising interest rates in December to now signalling a cut as soon as next month.
Many traders were still circumspect and expected the market to remain in a narrow range until after the weekend meeting of G20 leaders in Osaka, Japan, where Trump is also holding bilateral talks with other nations.
"Focus continues to be on the G20 meeting with a story in the SCMP...lifting the entire market, although the details suggest nothing has actually been agreed yet," JPMorgan said in a note.
"Overall it seems more likely that tariffs are hiked than not, following the meeting, though the timing of this may be confused by a desire for positive optics."
LESS THAN 50
Trump weighed into U.S. monetary policy on Wednesday, accusing Fed Chairman Jerome Powell of doing a "bad job" and "out to prove how tough he is" by not cutting interest rates.
Markets are convinced the Fed will indeed ease at its next meeting in July, but had to scale back bets on a half-point cut following cautious comments from various policy makers.
Futures are 100% priced for a cut of 25 basis points next month, and imply a 22% chance of 50 basis points.
The probability of a less aggressive Fed and expectations of a Sino-China trade truce helped ease the selling pressure on the U.S. dollar, which rose 0.1% to 96.300 on a basket of currencies from a three-month trough of 95.843.
The dollar bounced modestly against the yen to 108.13 and away from a low of 106.77. The euro likewise eased back to $1.13505 from a top of $1.1412.
The dollar's gains took a little of the shine off gold, which broke a six-session winning stretch and eased to $1,403.94 per ounce.
Oil prices ran into profit-taking too, having gained overnight on a larger-than-expected drawdown in crude stocks as exports hit a record high and surprise falls in refined product stockpiles.
Brent crude futures eased 55 cents to $65.92, while U.S. crude lost 47 cents to $58.91 a barrel.
(Additional reporting by Wayne Cole and Swati Pandey in Sydney; Editing by Angus MacSwan) |
'Love Island' contestant Elma Pazar reveals she lied about her age to get on the show
'Love Island' contestant Elma Pazar has revealed she's actually 26-years-old. (Dave J Hogan/Getty) This year’s Love Island contestants range from 20-years-old to 29-years-old but one former Islander has confessed to lying about her age in order to bag a place in the villa. Elma Pazar, an eyelash technician from Essex, was dumped last week when the public voted for Anton Danyluk - the guy she was coupled-up with - to stay in the competition instead of her. Now she’s revealed that she’s not 23, like she told the other contestants, but three years older. Read more: Caroline Flack fears being on a reality show would ruin her chances of finding love "I lied about my age on Love Island . I tell everyone I'm 23, it's a real issue,” she told Kem Cetinay and Arielle Free on the Love Island Morning After podcast. "I'm 26 but now everyone knows it because they said they couldn't lie for me." Caroline Flack has hosted 'Love Island' since it was rebooted in 2013 Interestingly, the average age of contestants this year is 24, and Pazar wouldn’t have been the oldest in the villa. Former air stewardess Amy Hart is 26 and firefighter Michael Griffiths is 27-years-old. Model Arabella Chi, pharmacist Anna Vakili and ring girl Maura Higgins are all 28, while model Tom Walker - who is currently coupled-up with the latter - is 29. Despite sparking up a potential romance with Danyluk in the villa, Pazar previously admitted to wanting to couple-up with sandwich maker Joe Garratt - but was put off by the fact that he seemed smitten with professional surfer Lucie Donlan. "Having gotten to know them all and living with them all, I think Joe,” she told The Sun Online, when asked who she’d wished she could have ‘cracked on with.’ "He's a southerner like me and he's really nice. He has a certain banter, and you get on with some people more than others and I think I really got on with him.” Read more: 'Love Island' star Joe Garratt refuses to apologise for 'gaslighting' Lucie Donlan But even though she left the villa at the same time as Garratt, she insisted they spent their first day in the real world apart, as he was kept in a safehouse following the backlash towards him and his “abusive” behaviour to Donlan . Story continues “I always had Lucie’s best interests at heart,” he explained to the publication. “I promise you I would do everything and anything to help her because she had a hard time in there and didn’t get on with the girls.” Love Island continues tonight at 9pm on ITV2. ---Watch the latest videos from Yahoo UK--- |
UPDATE 1-South Africa's Mminele quits as central bank deputy governor
(Adds details, background)
JOHANNESBURG, June 27 (Reuters) - Daniel Mminele will retire as deputy governor of the South African Reserve Bank at the end of the month after 10 years in the job, the central bank said on Thursday, making him the third member of its policy committee to quit the regulator recently.
Mminele's retirement follows the departure of fellow deputy governor Francois Groepe in January and advisor to the governor Brian Kahn late last year.
Governor Lesetja Kganyago's position is also up for renewal, with his five term expiring in November. He has previously said it is up to President Ramaphosa whether or not he will serve another five-year term.
"Mr Mminele has advised President Cyril Ramaphosa and the Board of Directors of the SARB (Board) that he has decided not to serve another term," the bank said in a statement. The statement gave no further reasons for Mminele's decision to stand down.
The bank has recently had to fend off renewed calls by the ruling African National Congress (ANC) to nationalise the regulator and extend its mandate beyond inflation targeting to include economic growth and unemployment.
The row rattled markets, which feared the bank's independence was under attack.
In response the SARB has defended its ground, saying it already factored economic growth into its policy decisions by keeping a lid on consumer inflation and protecting the currency.
It next meets in July to decide on lending rates after keeping them on hold at its last three meetings.
Expectations are it will cut rates by at least 25 basis points with price-growth well below the 4.5% mid-point of its target range, and economic growth floundering following a deep contraction in the first quarter. (Reporting by Mfuneko Toyanal Editing by Alison Williams and Toby Chopra) |
Bayer lifted by new plan to tackle glyphosate lawsuits, Elliott approval
By Tassilo Hummel and Ludwig Burger
BERLIN (Reuters) - Bayer shares jumped on Thursday after it revealed plans aimed at resolving multi-billion dollar lawsuits linked to glyphosate, a move welcomed by activist shareholder Elliott, which has taken a sizeable stake in the chemicals company.
Shares in the German group, which have lost more than a fifth of their value since March, were up 8% at 61.51 euros at 1009 GMT, their highest value in seven weeks.
Bayer said on Wednesday it had hired an external lawyer to advise its supervisory board and has set up a committee to help to resolve the glyphosate litigation issue.
Marks Manns, a fund manager at Union Investment, one of Bayer's largest German shareholders, said the share price was likely bolstered by anticipation of an earlier settlement.
"Investors want more certainty as quickly as possible. But it is for management to weigh up a quick settlement against how many billions you could save by holding out. I don't want a settlement at all costs," he said, adding that Bayer's negotiation position was for now highly unfavourable.
The company's shares have been under pressure following its $63 billion acquisition of Monsanto, which brought with it massive legal issues after more than 13,400 plaintiffs alleged the company's glyphosate weedkiller caused cancer - a claim Bayer contests.
Deka Investment, another major German shareholder said taking more legal expertise on board was "the right step", and was mainly a token of acknowledgement by the supervisory board of shareholder criticism.
Elliott Associates on Wednesday welcomed Bayer's steps, as it revealed for the first time its holding in Bayer shares worth 1.1 billion euros ($1.25 billion).
In a statement, Elliott also said Bayer's recent moves helped to resolve uncertainty linked to the glyphosate issue and lead to settlements with limited financial costs.
"Elliott believes that Bayer's discounted share price today does not reflect the significant underlying value of its constituent businesses, or the potential value realisation opportunity that is in excess of 30 billion euros," it said.
Major shareholders have criticised Bayer for its handling of the glyphosate issue which resulted in a vote of disapproval of its top management at April's annual general meeting.
($1 = 0.8801 euros)
(Additional reporting by Hakan Ersen and Patricia Weiss; Editing by Michelle Martin, Jane Merriman and Alexander Smith) |
Is Solvac S.A.’s (EBR:SOLV) Return On Capital Employed Any Good?
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Today we'll evaluate Solvac S.A. (EBR:SOLV) to determine whether it could have potential as an investment idea. In particular, we'll consider its Return On Capital Employed (ROCE), as that can give us insight into how profitably the company is able to employ capital in its business.
Firstly, we'll go over how we calculate ROCE. Then we'll compare its ROCE to similar companies. Then we'll determine how its current liabilities are affecting its ROCE.
ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. Generally speaking a higher ROCE is better. In brief, it is a useful tool, but it is not without drawbacks. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Solvac:
0.074 = €269m ÷ (€3.7b - €60m) (Based on the trailing twelve months to December 2018.)
So,Solvac has an ROCE of 7.4%.
See our latest analysis for Solvac
ROCE is commonly used for comparing the performance of similar businesses. Using our data, Solvac's ROCE appears to be around the 7.4% average of the Chemicals industry. Setting aside the industry comparison for now, Solvac's ROCE is mediocre in absolute terms, considering the risk of investing in stocks versus the safety of a bank account. It is possible that there are more rewarding investments out there.
In our analysis, Solvac's ROCE appears to be 7.4%, compared to 3 years ago, when its ROCE was 3.9%. This makes us wonder if the company is improving. You can see in the image below how Solvac's ROCE compares to its industry. Click to see more on past growth.
Remember that this metric is backwards looking - it shows what has happened in the past, and does not accurately predict the future. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is, after all, simply a snap shot of a single year. You can check if Solvac 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 counteract this, we check if a company has high current liabilities, relative to its total assets.
Solvac has total assets of €3.7b and current liabilities of €60m. As a result, its current liabilities are equal to approximately 1.6% of its total assets. Solvac has a low level of current liabilities, which have a minimal impact on its uninspiring ROCE.
Solvac looks like an ok business, but on this analysis it is not at the top of our buy list. Of course,you might also be able to find a better stock than Solvac. So you may wish to see thisfreecollection of other companies that have grown earnings strongly.
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. |
Five issues likely to dominate the G20 summit in Japan
OSAKA (Reuters) - World leaders are descending on Osaka, west Japan, for a summit on Friday and Saturday of the Group of 20 (G20) big economies. Here are five issues likely to dominate the meeting, hosted by Japanese Prime Minister Shinzo Abe. TRUMP-XI TRUCE? Overshadowing the G20 meeting, U.S. President Donald Trump and Chinese President Xi Jinping will meet on Saturday amid hopes for a breakthrough in the trade war between the world's two biggest economies, which has already dented global growth. The United States and China agreed to a tentative truce in the nearly year-old dispute ahead of the Osaka meeting, Hong Kong's South China Morning Post reported on Thursday, citing sources. Before leaving the United States on Wednesday, Trump said a deal was possible this weekend but he was prepared to impose tariffs on virtually all Chinese imports not already subject to U.S. levies, if the two countries continue to disagree. GLOBAL ECONOMY Policymakers are in a bind as global growth slows because of trade tensions, with the U.S. Federal Reserve signaling it will cut interest rates. That is weakening the dollar and putting pressure on the European Central Bank and Bank of Japan to come up with ways to keep their currencies from spiking, which would undermine their export-reliant economies. Abe hopes to get free-trade language in the meeting's closing communique but faces resistance from Trump, who last year forced the G20 to drop its longstanding pledge to avoid protectionism. CLIMATE CHANGE A tussle over global warming continues, with U.S. negotiators opposing a European-led push for a strong commitment to fighting climate change. The latest draft of the G20 language on climate change, seen by Reuters, revives support for the 2015 Paris Agreement, calling it "irreversible". An earlier draft had avoided that commitment at the insistence of the United States, two sources told Reuters. President Emmanuel Macron said France would not accept a G20 communique that does not mention the Paris accord. Trump, who has called global warming a "hoax", pulled the United States out of the pact in 2017. Story continues IRAN AND OIL While Iran is not a G20 member, it will very much be there in spirit as the threat of war with the United States looms after a series of incidents in the Gulf and escalating rhetoric. Trump at the last minute halted an air strike on Iran last week in retaliation for its downing of a U.S. drone. Since then, he has strengthened sanctions on Iran and threatened it with "obliteration". Iran said his sanctions were "mentally retarded". As well as the Gulf tensions, oil markets are on edge about a looming deadline for OPEC to decide whether to extend production cuts. That could be the focus of Osaka meetings between Russian President Vladimir Putin and Saudi Crown Prince Mohammed bin Salman. OCEAN TRASH One G20 agenda item on which Abe may make progress is reducing the glut of plastic waste in the oceans - although specific targets and firm commitments to action are unlikely. The G20 will adopt a new implementation framework for steps to reduce marine plastic waste, though on a voluntary basis, the Japanese government said after environment ministers met two weeks ago. (Reporting by Malcolm Foster, Leika Kihara, Howard Schneider, Aaron Sheldrick, Susan Heavey and Andrea Shalal; Writing by Malcolm Foster; Editing by William Mallard) |
BOJ's deputy chief signals room for pre-emptive easing to fend off risks
By Leika Kihara
AOMORI, Japan (Reuters) - The Bank of Japan stands ready to ease monetary policy pre-emptively to fend off risks that could derail the economy's path toward achieving its 2% inflation target, Deputy Governor Masazumi Wakatabe said on Thursday.
With U.S.-China trade tensions weighing on business sentiment and slowing Chinese demand hurting exports, there is a "significant risk" the BOJ may be forced to alter its current assessment that Japan's economy will keep expanding moderately as a trend, Wakatabe said on Thursday.
"If the economy comes under severe downward pressure and we can say with confidence the momentum for achieving our price target is being lost, the BOJ must ease policy immediately without hesitation," he told a news conference after meeting with business leaders in Aomori, northern Japan.
The BOJ kept policy steady last week but Governor Haruhiko Kuroda signalled readiness to ramp up stimulus as global risks cloud the economic outlook, joining U.S. and European central banks in opening the door to additional easing.
Wakatabe said the U.S.-China trade dispute, if prolonged, would hit the global economy not just through higher tariffs, but by discouraging firms from investing and hurting market sentiment.
A prolonged global downturn would also weigh on currently robust domestic demand, adding to the pain from Japan's scheduled sales tax increase to 10% from 8% in October, he said.
"There's a chance the BOJ will take pre-emptive action if the board can agree that without doing so, it would be difficult to achieve its price target," said Wakatabe, a former academic known as a vocal advocate of aggressive easing.
FACTORS BEHIND FED MOVE KEY
Japan's economy expanded by an annualised 2.1% in the first quarter but many analysts predict growth will slow in coming months as the U.S.-China row wears on.
The bickering over trade policy between the world's first and second biggest economies have put major central bankers in a tough spot, with depleted ammunition to battle a downturn that may be coming sooner than expected.
Despite efforts by the U.S. Federal Reserve to temper market expectations of a big, imminent interest rate cut, investors are pricing in a strong chance of one as early as next month.
Wakatabe said while the BOJ won't ease just because the Fed does, it was important to look carefully at what would drive the U.S. central bank into action.
"We need to give look at how big the risks are to our baseline economic scenario. We also need to think about how the BOJ ought to act, taking into account the reasons behind any Fed action," he said.
Aside from immediate policy actions, the Fed is also discussing ways to update its policy framework.
Wakatabe said Japan could learn from various ideas being proposed in the discussions, such as setting a higher inflation target or targeting average inflation over a number of years.
"At present, it's appropriate to maintain the current policy framework," he said. "That being said, I think it is necessary for the BOJ to study ideas towards enhancing its monetary policy conduct."
(Reporting by Leika Kihara; Editing by David Dolan & Shri Navaratnam) |
Joss Stone sparks online backlash after wearing pink niqab in Saudi Arabia
Joss Stone sparked criticism online after sharing a photograph of herself wearing a pink niqab [Photo: Instagram/Getty] Joss Stone has sparked an online debate about the oppression of women in Saudi Arabia after sharing a photograph of herself wearing a pink niqab on social media. In the Instagram caption, the singer revealed that she loved wearing the Muslim veil during the trip, as she likes to embrace different cultures while travelling. She then went on to talk about the strong women she met while visiting the country who are exercising their choice to be free, wear what they want and do what they want, their want may be different to what we experience at home but there aint nothing wrong in that. To each her own, she continued. I spoke to female doctors, managers, directors, vocal specialists, hearing specialists, carers, a singer/performer/artist and they all tell the same tale. But the post swiftly divided her 259,000 Instagram followers. View this post on Instagram A post shared by Joss Stone (@jossstone) on Jun 24, 2019 at 6:34pm PDT A number of social media users took to the comments section to praise the singer for embracing the culture and opening peoples eyes, minds and hearts. Joss, I have so much respect for you travelling the world and opening peoples eyes, minds and hearts, one social media user wrote. We cannot change the world at once but we can surely stand with all people of all beliefs and make baby steps to raise awareness for equality. While others, heavily criticised Stone for sharing the photograph online. The hijab is not a symbol of a free, powerful woman, it is one of oppression, one follower wrote. It is Sharia law compliance by force, not by choice. Western liberal progressives and feminists are falsely portraying the hijab as something beautiful and powerful. Another agreed, adding: Sorry, Joss, I never criticised your posts before, I do not agree with this one. Wearing hijab is not a fun thing, it is not even a cultural thing, it is a religious symbol of oppression and control over women. It doesn't matter if women like wearing it. It is like a caged birds - if you open up the cage, most of them will not go out, they are afraid of unknown. Story continues READ MORE: Mum scrawls eerie note after she died and saw heaven A third commented, You may like the hijab because you wear it as a kind of fun. But many women in the middle east like the women of Iran are fighting with the hijab law on a daily basis. So for me as a middle eastern women who grew up under the Islamic laws its not fun to watch you wearing hijab while many of my sisters are in prisons in Iran or Saudi because of fighting against it. I'm sorry but Joss Stone has clearly never heard of the Hai'a virtue police. It's great you want to wear a headscarf in #SaudiArabia , and things have relaxed a little in the last two years, but please don't pretend every woman in the country has that same choice pic.twitter.com/ojh4WUetFy Josie Ensor (@Josiensor) June 26, 2019 A niqab is a traditional veil that covers the face but leaves the areas around the eyes clear. However, it may be worn with a separate eye veil or worn with an accompanying headscarf. Last year, Saudi Crown Prince Mohammad bin Salman stated that it is no longer compulsory for women in the country to wear the abaya - a full-length robe - as long as they dress in decent and respectful attire. View this post on Instagram A post shared by Joss Stone (@jossstone) on Jun 24, 2019 at 11:38pm PDT But a number of women living in Saudi Arabia still feel forced to wear the garment and launched a protest in November 2018 by wearing the garment inside out. Although the use of hijabs, burkas and niqabs is widely disputed, some women state that it is their choice to wear the religious items. View this post on Instagram A post shared by Joss Stone (@jossstone) on Jun 22, 2019 at 3:47pm PDT Stones most recent concert is part of her Total World Tour which has seen her perform in the likes of North Korea, Jordan, Oman and Syria. Watch the latest videos from Yahoo Style UK: |
UPDATE 1-South Africa records FDI, portfolio investment inflows in Q1
(Adds more details)
PRETORIA, June 27 (Reuters) - South Africa saw foreign direct investment inflows in the first three months of this year versus outflows in the previous quarter as private domestic firms received funding from foreign parent companies, the central bank said on Thursday.
South Africa relies heavily on foreign money to cover its large budget and current account deficits.
The economy nosedived 3.2% in the first quarter, its worst economic contraction in a decade, another sign that President Cyril Ramaphosa's growth drive is struggling to gain traction.
Despite the GDP contraction, FDI inflows totalled 11.7 billion rand ($825.33 million) in the first quarter, against outflows of 8.2 billion in the previous three months, the South African Reserve Bank (SARB) said.
The country also registered portfolio investment inflows of 29.2 billion rand from January to March from outflows of 33.9 billion rand in the prior quarter as foreigners' acquisitions of domestic debt securities exceeded net sales of local equities, the SARB said.
Investor confidence in Africa's most industrialised economy remains fragile, despite Ramaphosa's pledges to woo investment, create jobs and root out rampant corruption.
SARB data showed that South Africa's business cycle has been in a downward phase since December 2013, its longest downswing since 1946.
($1 = 14.1762 rand) (Reporting by Olivia Kumwenda-Mtambo; Editing by Jan Harvey) |
Cryptocurrency market cap reaches $323 billion; more IEOs to come, report shows
The value of the cryptocurrency market continues to grow, reaching $323 billion by the end of June 2019, according to a report carried out by PwC and the Crypto Valley Association.
In February this year, cryptocurrencies' market cap hit a 21-month low. However, by the end of May, its value had more than doubled and has continued growing since.
The ongoing clarification of regulatory frameworks may have contributed to the rising prices of cryptocurrencies, the report suggests. Similarly, the renewed attention from institutional investors and established companies may have also affected the market positively.
According to the report, there have been more than 250 token offerings this year, raising a total of $3.3 billion; withBitfinex’s IEOtopping the table.
“The development of IEOs has accelerated significantly since the beginning of 2019,” noted Dr. Daniel Diemers, Head of Blockchain EMEA at PwC. “It reflects the creativity and innovative spirit of the crypto industry and shows that the demand for simple and secure solutions is growing. IEOs show that fundraising via cryptocurrencies is becoming more established and striving for greater institutionalization and credibility.” |
H&M shares jump as early summer sales shine
By Anna Ringstrom
STOCKHOLM (Reuters) - Swedish fashion group H&M said sales of its summer collections had started well and it would slow the rate of store openings as it invests more online, boosting its shares by 10%.
The world's second-biggest fashion retailer after Zara owner Inditex said on Thursday sales growth accelerated to 12% in local currencies in June, the first month of its fiscal third quarter, from 5% in the second quarter.
That beat analysts' expectations as well as the 10% rise Inditex reported for the six weeks from the start of May.
Chief Executive Karl-Johan Persson told Reuters the arrival of warmer weather in Europe had helped.
Northern European markets, where unusually cold weather dampened demand for summer ranges in the second quarter, did particularly well in June as temperatures climbed, he said.
Better collections from the core H&M brand and purchasing improvements that allowed the company to respond more quickly to demand also helped in June, he added. "It's partly due to external factors, but we also do things better than we did a year ago. Underlying levels are sounder," Persson said.
H&M also said it was cutting the net number of new stores it plans to open in 2019 to around 130 from 175, as it invests more in digital features across the business.
Persson said openings were shelved mainly in Europe, but also in the United States and China. More store closures will contribute to the new net total as well.
ADAPTING TO CHANGE
Executives at a news conference stood by H&M's capital spending forecast for the year as a whole, reassuring analysts who had feared more pressure on margins from higher investments, after the firm said recently it had intensified its work to adapt to a rapidly changing retail landscape.
At 1205 GMT, H&M shares were up 7.9%, having earlier touched a seven-week high of 161.40 Swedish crowns.
"The fact that June sales get a boost, more so than the trend we've seen in the past several quarters, is a highlight for me," Danske Markets analyst Daniel Schmidt said, adding the reduction of store openings was also a welcome development.
"It shows that they more and more are taking on board the changes that are occurring (in the retail sector)."
Despite investing heavily in logistics, digital technology and store concepts, and reviewing its mix of stores and brands, H&M has struggled to convince investors it is back on track.
Its shares remain far off 2015 record levels and little above the 13-year low seen in 2018.
H&M reported a pretax profit for the three months to the end of May, its fiscal second quarter, of 5.9 billion crowns ($640 million), down from 6.0 billion a year earlier, slightly shy of analyst expectations.
The gross margin shrank 1%, in line with expectations.
H&M has seen profits fall and inventories rise in recent years as its core budget brand has not kept up with rivals, particularly online, and not reacted fast enough to demand swings.
Inventories grew 11% to 40.4 billion crowns at the end of the second quarter, equivalent to 18% of sales. But H&M said the composition of the stock had kept improving.
Markdowns fell for a third straight quarter, by 1 percentage point in relation to sales, and H&M said it expected them to fall by a further 1.5 percentage points in the third quarter.
"We think H&M is improving its offer, which should lead to a sales and earnings recovery in time, albeit with execution risk and in an ongoing tough competitive environment," said RBC Capital Markets analyst Richard Chamberlain.
($1 = 9.2709 Swedish crowns)
(Reporting by Anna Ringstrom and Niklas Pollard; Editing by Emma Thomasson, Keith Weir and Mark Potter) |
Huawei warns US patent curbs would hurt global tech
SHENZHEN, China (AP) — Chinese tech giant Huawei warned Thursday a U.S. senator's proposal to block the company from pursuing damages in patent courts would be a "catastrophe for global innovation." The proposal comes amid mounting U.S. action against Huawei, the biggest maker of switching gear for phone carriers. The company has been devastated by the Trump administration's decision to impose restrictions on its access to American chips for smartphones and other components and technology. Disrupting Huawei's access to U.S. patent courts would threaten the intellectual property system that supports technology development, said Song Liping, the company's chief legal officer. The proposal by Sen. Marco Rubio, a Republican from Florida, followed reports Huawei Technologies Ltd. is asking for $1 billion from American phone carrier Verizon for use of the Chinese company's patents. "If such a legislative proposal were to be passed, it would be a catastrophe for global innovation. It would have terrible consequences," Song said at a news conference. He said it would "break the foundation of IP protection." American officials accuse Huawei of facilitating Chinese spying, a charge the company denies, and see it as a growing competitive threat to U.S. technology industries. Huawei's founder, Ren Zhengfei, said this month it has cut its project sales by $30 billion over the next two years due to curbs on access to American chips and other components. He said smartphone sales outside China will fall 40%. Huawei's U.S. sales of network gear evaporated after a congressional panel labeled the company a security threat in 2012 and told phone carriers to avoid it. But the Chinese company has a patent portfolio it licenses to manufacturers and carriers. Song gave no confirmation of how much Huawei wants from Verizon or the basis of its claims. "We aren't taking an aggressive approach to intellectual property rights," Song said. "We aim to protect our IP in order to safeguard our global business and we have no intention of weaponizing IP. We are against charging exorbitant royalties, and we think that the fees should be within reasonable realms." Huawei, founded in 1986, has China's biggest corporate research and development budget at $15 billion in 2018. The company is a leader in developing next-generation telecoms technology. On Wednesday, a U.S. federal court jury in Texas ruled Huawei stole trade secrets from a Silicon Valley company but awarded no damages, saying the Chinese company didn't benefit. The jury rejected Huawei's claims that Cnex Labs Inc. co-founder Yiren Huang stole its technology while he worked at a Huawei subsidiary. Story continues Huawei's head of intellectual property, Jason Ding, said the company was studying the verdict and deciding what to do next. Asked about a report by Bloomberg News that some Huawei researchers had published papers with Chinese military personnel over the past decade, Song said the company wasn't aware of its employees publishing research as private individuals. "We don't customize products or do research for the military," said Song. "We are not aware of employees publishing papers. We don't have projects of that kind." View comments |
How Much Are Somany Ceramics Limited (NSE:SOMANYCERA) Insiders Taking Off The Table?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Somany Ceramics Limited ( NSE:SOMANYCERA ). What Is Insider Buying? 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. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' Check out our latest analysis for Somany Ceramics The Last 12 Months Of Insider Transactions At Somany Ceramics The , Anushree Chopra, made the biggest insider sale in the last 12 months. That single transaction was for ₹13m worth of shares at a price of ₹440 each. So what is clear is that an insider saw fit to sell at around the current price of ₹429. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern. Anushree Chopra was the only individual insider to sell shares in the last twelve months. 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! NSEI:SOMANYCERA Recent Insider Trading, June 27th 2019 For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket. Story continues Does Somany Ceramics Boast High Insider Ownership? Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Somany Ceramics insiders own about ₹1.8b worth of shares. That equates to 10% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders. So What Do The Somany Ceramics Insider Transactions Indicate? An insider hasn't bought Somany Ceramics stock in the last three months, but there was some selling. And even if we look to the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. Of course, the future is what matters most . So if you are interested in Somany Ceramics, you should check out this free report on analyst forecasts for the company . Of course Somany Ceramics may not be the best stock to buy . So you may wish to see this free collection 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 at editorial-team@simplywallst.com . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Should You Be Worried About Insider Transactions At Somany Ceramics Limited (NSE:SOMANYCERA)?
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 inSomany Ceramics Limited(NSE:SOMANYCERA).
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Columbia Universitystudyfound that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.
View our latest analysis for Somany Ceramics
In the last twelve months, the biggest single sale by an insider was when the , Anushree Chopra, sold ₹13m worth of shares at a price of ₹440 per share. That means that an insider was selling shares at around the current price of ₹429. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern. The only individual insider seller over the last year was Anushree Chopra.
You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that Somany Ceramics insiders own 10% of the company, worth about ₹1.8b. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
An insider hasn't bought Somany Ceramics stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course,the future is what matters most. So if you are interested in Somany Ceramics, 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. |
UPDATE 1-G20 members at odds over climate change for summit meeting -sources
(Updates story to change media slug to G20-SUMMIT/CLIMATECHANGE. Previous was G20-JAPAN/CLIMATECHANGE.)
By Aaron Sheldrick
TOKYO, June 27 (Reuters) - G20 negotiators are wrangling over the wording of a summit communique on combatting climate change, with the United States pushing to downgrade the language against European opposition, according to sources and drafts of the text.
The arguments are a reprise of tussles over global warming that have stymied talks in multilateral forums since U.S. President Donald Trump pulled the United States out of a landmark agreement to limit the effects of climate change.
The latest draft, seen by Reuters, includes language supporting implementation of the 2015 Paris Agreement, and saying the accord signed by 200 nations is "irreversible".
An earlier draft, also seen by Reuters, did not include such language at the insistence of the United States, two sources familiar with the discussions over the communique told Reuters. Further changes to the communique are likely before the final adoption of the text on Saturday by Group of 20 leaders in Osaka for this week's summit, but the inclusion of stronger language came as French President Emmanuel Macron said France will not accept a text that does not mention the Paris agreement.
"If we don't talk about the Paris Agreement and if we don't get an agreement on it amongst the 20 members in the room, we are no longer capable of defending our climate change goals and France will not be part of this," he said in Tokyo on Wednesday before heading to Osaka.
France was one of the main drivers behind the Paris accord and the French parliament is now debating an energy bill that targets net zero greenhouse gas emissions by 2050.
"Negotiations on the topic of climate will be especially difficult this time," a German government official said on Wednesday.
Nations in Paris agreed to limit the global average rise from pre-industrial temperatures to well below 2 degrees Celsius (3.6 degrees Fahrenheit). Current policies, though, put the world on track for at least a 3C rise by the end of the century, according to a United Nations report in 2016.
Investors managing more than $34 trillion in assets, nearly half the world's invested capital, piled pressure on G20 leaders on Wednesday, demanding urgent action from governments on climate change.
United Nations Secretary-General Antonio Guterres on Wednesday also urged G20 countries to back more ambitious climate goals, among other international initiatives.
Summit host Japan has been criticized for backing the continued use of coal for power generation, one of the biggest sources of gas emissions that cause global warming.
G20 leaders will meet on Friday and Saturday. (Reporting by Aaron Sheldrick; Editing by Tom Hogue) |
Did Changing Sentiment Drive Serviceware's (ETR:SJJ) Share Price Down By 24%?
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While not a mind-blowing move, it is good to see that theServiceware SE(ETR:SJJ) share price has gained 23% in the last three months. But that is minimal compensation for the share price under-performance over the last year. After all, the share price is down 24% in the last year, significantly under-performing the market.
View our latest analysis for Serviceware
In his essayThe Superinvestors of Graham-and-DoddsvilleWarren Buffett described how share prices do not always rationally reflect the value of a business. 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).
Serviceware fell to a loss making position during the year. While this may prove temporary, we'd consider it a negative, so it doesn't surprise us that the stock price is down. However, there may be an opportunity for investors if the company can recover.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
It might be well worthwhile taking a look at ourfreereport on Serviceware's earnings, revenue and cash flow.
Serviceware shareholders are down 24% for the year, even worse than the market loss of 3.2%. 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 23%, in the last ninety days. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. You could get a better understanding of Serviceware'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 DE 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 Somi Conveyor Beltings Limited (NSE:SOMICONV) A Smart Pick For Income Investors?
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Today we'll take a closer look at Somi Conveyor Beltings Limited (NSE:SOMICONV) 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. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments.
Some readers mightn't know much about Somi Conveyor Beltings's 2.9% dividend, as it has only been paying distributions for the last three years. A low dividend might not be a bad thing, if the company is reinvesting heavily and growing its sales and profits. Remember that the recent share price drop will make Somi Conveyor Beltings's yield look higher, even though recent events might have impacted the company's prospects. When buying stocks for their dividends, you should always run through the checks below, to see if the dividend looks sustainable.
Click the interactive chart for our full dividend analysis
Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Looking at the data, we can see that 38% of Somi Conveyor Beltings's profits were paid out as dividends in the last 12 months. A medium payout ratio strikes a good balance between paying dividends, and keeping enough back to invest in the business. Besides, if reinvestment opportunities dry up, the company has room to increase the dividend.
As Somi Conveyor Beltings has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA is a measure of a company's total debt. Net interest cover measures the ability to meet interest payments. Essentially we check that a) the company does not have too much debt, and b) that it can afford to pay the interest. With net debt of 2.18 times its EBITDA, Somi Conveyor Beltings's debt burden is within a normal range for most listed companies.
We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. With EBIT of 1.52 times its interest expense, Somi Conveyor Beltings's interest cover is starting to look a bit thin.
We update our data on Somi Conveyor Beltings every 24 hours, so you can always getour latest analysis of its financial health, here.
One of the major risks of relying on dividend income, is the potential for a company to struggle financially and cut its dividend. Not only is your income cut, but the value of your investment declines as well - nasty. This company's dividend has been unstable, and with a relatively short history, we think it's a little soon to draw strong conclusions about its long term dividend potential. During the past three-year period, the first annual payment was ₹1.00 in 2016, compared to ₹0.50 last year. Dividend payments have fallen sharply, down 50% over that time.
A shrinking dividend over a three-year period is not ideal, and we'd be concerned about investing in a dividend stock that lacks a solid record of growing dividends per share.
Given that dividend payments have been shrinking like a glacier in a warming world, we need to check if there are some bright spots on the horizon. Over the past five years, it looks as though Somi Conveyor Beltings's EPS have declined at around 16% 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. Firstly, we like that Somi Conveyor Beltings has low and conservative payout ratios. Earnings per share have been falling, and the company has cut its dividend at least once in the past. From a dividend perspective, this is a cause for concern. While we're not hugely bearish on it, overall we think there are potentially better dividend stocks than Somi Conveyor Beltings out there.
See if management have their own wealth at stake, by checking insider shareholdings inSomi Conveyor Beltings stock.
If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Do I Pay Social Security Taxes on All of My Income?
Millions of people rely on Social Security, and the money to fund the program comes heavily from taxes paid by working Americans. If you take a look at your paystubs, you'll notice that you pay something calledFICA tax. That's short for the Federal Insurance Contribution Act, and it's how two key programs -- Social Security and Medicare -- get their funding. But whereas you're guaranteed to pay Medicare taxes on all of your income, the same does not hold true for Social Security.
All workers are required to pay Social Security and Medicare taxes, but if you're a salaried employee, you're only responsible for half of that liability, as your employer will pick up the second half of that tab. If you'reself-employed, you're required to foot the bill forallof your FICA tax, but you'll get the option to deduct half of that sum on your taxes.
ForMedicare purposes, you'll pay a 2.9% tax on all of your wages. Again, if you're employed by an outside company, you'll only pay half that amount, or 1.45%. Social Security, however, has an earnings cap for tax purposes, which means that once your income reaches a certain level, you're no longer liable for taxes. That level changes from year to year, and for 2019, it's $132,900.
IMAGE SOURCE: GETTY IMAGES.
Furthermore, the tax rate for Social Security is 12.4%, which you'll either need to pay completely if self-employed or split with your employer. This means that if you're self-employed, you'll pay up to $16,480 in Social Security taxes.
Many lawmakers believe that the current tax setup is unfair with regard to Social Security, and many workers no doubt feel the same. For example, if you earn $140,000 a year (which may or may not be a lot of money, depending on the cost of living where you're located), you may be wondering why you're paying the same amount of Social Security tax as someone who earns millions of dollars a year.
Unfortunately, there's really no good answer other than "because that's the way things have been for years." But if you're in the camp of people who believe that the current system unfairly favors the rich, you can rest assured that many politicians feel similarly and are pushing for change, especially given Social Security's shaky future. Though the program has enough money to keep up with its financial obligations at present, come 2035, when its trust funds run out, it may have no choice but tocut scheduled benefits, thereby leaving millions of people to struggle. Proponents of lifting the earnings cap say that all of that added tax revenue could help compensate for Social Security's impending shortfall.
On the flip side, some argue that FICA taxes are already a burden for what we'll call moderately high earners -- folks who may earn more than $132,900, but not so much more that they're rolling in money. This especially holds true for workers who earn higher salaries but who live in expensive housing markets where a starter home, for example, costs four times the national average.
So, what's the solution? Right now, there is none. But as someone who pays taxes, it makes sense to stay aware of what your personal burden is for Social Security purposes. This especially holds true if you're self-employed and are responsible for forking over your entire Social Security tax bill without any help from an employer.
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4 Savings Goals You Should Set Today
Setting specific financial goals is often the first essential step toward achieving your dreams. After all, if you don't have goals, you won't know what to do with your money -- and you won't know if you're on track to be prepared for important life milestones such as retirement. Unfortunately, it can be hard to figure out exactly what goals to set.
While everyone has their own objectives in life and their own unique financial priorities, there are four big savings goals most everyone should have for themselves. Here are those four goals, along with some tips to help achieve them.
Image source: Getty Images.
Living on Social Security alone is neither practical nor desirable, as Social Security income will provide just enough money to stay above the poverty level. Since pensions with guaranteed income are few and far between, you have only yourself to rely on when it comes to supplementing Social Security benefits. That means you need to set a retirement savings goal so you can build the nest egg you need to be comfortable.
There are lots of different ways you can estimate the amount you need for retirement. You could plan to save 10 times your final salary, or aim to build enough of a nest egg to replace at least 80% to 90% of the income you were earning right before retirement. For most people, these methods of figuring out an exact retirement savings number can be pretty complicated, especially if you're decades away from retirement.
It can be easier instead to just save a big enough percentage of your current income that you're likely to amass the funds you need as a senior. While experts traditionally recommended saving 10% of income, this probably isn't enough thanks to longer life-spans and other economic factors. Instead, set a goal of saving15% of income for retirement.
This goal is easy to measure, and it's also pretty simple to work up to achieving it. If you're saving up 6% of income now, simply increase this percentage upward until you hit the 15% mark. You can do this gradually if necessary, inching up your savings by a percent or two. You likely won't notice much difference if you slowly increase the amount you contribute to a 401(k) or IRA. And whenever you get a raise, you can bump up your savings by a big amount. If you get a 2% salary boost, you could bank your entire raise and up your savings to 8% of salary.
Everyone needs an emergency fund. After all, something is certain to go wrong at some point -- and it will probably cost you money when it does. You don't want to rely on your credit cards or raid savings accounts for other goals when an unexpected expense happens, so you need a dedicated fund just to pay for these bumps in the road.
Ideally, your emergency fund will be big enough to cover three to six months of living expenses. If you're the sole breadwinner, have little job security, or have health issues, err on the side of caution and save enough to cover six months of expenses. If you're super healthy, could get hired quickly, and have a spouse with enough income to keep you afloat, you could settle for a fund to cover three months of expenses.
It can take time to save this much money, but budget as much as you can for emergency fund contributions until you hit your goal. If you're working on paying down high-interest consumer debt, though, you may wish to save up a baby emergency fund of around $500 to $2,000 (depending on income) and then devote extra cash to debt repayment. Once you've got your debt paid down, switch to concentrating on building up your emergency savings.
Cars, vacations, new appliances, a new home -- all of these things are purchases you may want to make at some point and probably can't afford to fund out of a single paycheck. You don't want to borrow for a big purchase or put off buying a home forever because you don't have a down payment. So, set a goal to save for the big things you want to buy.
You can actually have separate dedicated savings accounts for each big purchase you hope to make in the future. Decide how much money you need for each buy, figure out your timeline for when you want to purchase, and then budget an appropriate amount each month so you'll have the cash you need when the time comes.
By taking this approach this, you can avoid paying interest on most purchases and can save up a 20% down payment for a home to avoid paying private mortgage insurance costs. You'll save a fortune and can make purchases guilt-free because you'll have the money earmarked for just that expense.
If you have kids, chances are good you want them to get an education. Unfortunately, schooling can be extremely expensive. And, even if you're OK with making your kids take out student loan debt, there are caps on federal student loans. While you or your kids could potentially take out private student loans to supplement federal aid, this can make going to school evenmoreexpensive.
Starting to save when your kids are young could at least reduce the amount they have to borrow, even if you can't fully fund their schooling. And since many parents end up borrowing or co-signing and sharing responsibility for their kids' debt, saving for college can also help you to protect your own financial future.
You can save money in a529 planto score tax breaks for college investing or look into prepaid tuition plans if you have a pretty good idea of where your child will go to school. You can also ask grandparents and other relatives to contribute to these accounts in lieu of gifts your kids will likely outgrow quickly.
There is one caveat, though. You should not compromise your own retirement savings to set aside money for college. Funding your retirement accounts comes first and saving for college is a good goal only if you have money left over after preparing for your future.
When you establish financial goals, you can easily track your progress. And you can make sure you're using money on things that are meaningful to you and that add real value to your life. Start by setting these four goals for yourself today if you haven't already achieved them. When you can check these items off your to-do list, you'll have a lot more financial security, and you'll be glad you made the effort.
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43% of Millennials Aren’t Investing — and That’s a Problem
woman on skateboard riding off into the sunset Millennials face unique financial challenges, including a changing employment landscape and mounting student debt. This generation must find creative ways to achieve goals such as buying a house, having children or saving for retirement. However, many Americans ages 25-34 aren’t taking advantage of a key method for accumulating wealth: investing. Specifically, 43% of millennials aren’t investing their money in stocks, bonds, real estate and more. That’s a problem because people who start investing at a young age or when they’re first starting their careers have more time to generate returns that will help them accomplish their financial goals. Find out how much — or how little — millennials currently have invested, and what’s stopping them from moving forward with this important money habit. Millennials Have Invested Less Than $500 Over Their Lifetime An alarming 21% of millennials have invested less than $500 in total over their lifetime. Overall, 54% of 25- to 34-year-olds have invested less than $5,000, and only a small percentage — 14% — have invested more than $50,000. Question: To your best estimate, how much of your money have you invested over your lifetime? Answer Choice Percentage of Millennials Less than $500 21% $500 to $999 10% $1,000 to $2,499 12% $2,500 to $4,999 11% $5,000 to $9,999 14% $10,000 to $49,999 18% More than $50,000 14% A $500 investment may not seem like a lot, but if you start young, even small sums can generate large returns over your lifetime. “Start small, but start early, so you’ll get the advantage of compound interest,” said Bobbi Rebell, a certified financial planner and author of “How to Be a Financial Grownup.” With the power of daily compound interest, a 30-year-old who invests $500 with a 5% rate of return will see that money grow into $2,876.96 at age 65 — even if they don’t contribute anything more. If that same 30-year-old puts an additional $50 per month toward their investments, they’ll end up with $59,923.91. And, if they had started investing at age 20 instead of age 30, their nest egg would be a jaw-dropping $106,578.42 — not bad for a $500 initial investment. Story continues Read More: How To Get Over Your Fear of Investing Millennials Know They Should Be Investing — but Many Say They Can’t Afford It Even if many of them aren’t doing it, millennials clearly understand the importance of starting early: 66% said the best time to start investing is prior to age 35. However, the biggest reason millennials aren’t investing is that they don’t feel they have enough money to do so. Almost half of 25- to 34-year-olds said they can’t afford to invest. Question: What is the primary reason you’re not investing? Answer Choice Percentage of Millennials I do not have enough money to invest 45% I simply do not want to invest 16% I do not know how to invest/never learned how to invest 12% I am afraid to lose money 12% I don’t trust the stock market 10% I would not have enough time to manage my investments 6% Granted, millennials have heavy student loan debt and a rising cost of living to contend with, but losing out on compound interest early on might cause you to fall behind on your financial goals. “You can’t afford to wait 40 years before you start investing,” Rebell said. To see where you can scrape together some funds for investing, take a careful look at your current spending. Bringing your lunch to work a couple of times during the workweek instead of going out to eat could easily save you at least $12.50 per week — that’s $50 per month, or your starting investment. You could also move money from a low-interest savings account, or your stash of cash at home, into an investment account where you can get a better rate of return. Additionally, 12% of millennials who aren’t investing said they lack the right knowledge, but there are plenty of investing resources for beginners that can help you jump-start your portfolio. Millennials Want Bigger Salaries and Less Debt Before They Start Investing Nearly half of millennials would like to see a raise at work and pay down more of their debt before beginning to invest. But there are different ways you can start now, even if your salary isn’t as high as you’d like and you’re burdened with a hefty amount of debt. You can juggle your financial priorities by paying off your high-interest debt first — like credit cards — and then tackling obligations with lower interest rates. In fact, steadily paying off lower-interest debt — like a mortgage — instead of rushing on payments can provide benefits such as greater liquidity and tax breaks. As long as you make full payments on time every month, your credit score shouldn’t suffer. “Some people will say you can’t invest until you’ve paid off all your debt,” Rebell said. “That simply isn’t true.” Discover: 9 Fastest-Growing Industries To Invest In This Year Over Half Want To Invest For Retirement — Here’s How To Get There Even though many millennials are still in the beginnings of their careers, they’re concerned about their golden years. A little more than half of Americans ages 25-34 — or 51% — are focused on investing for retirement. However, it can be difficult to build a sizable nest egg without refining your investment strategy. millennials investing Here are financially savvy ways for millennials to plan for retirement : Start now, and automate your investing. Even if you can only contribute a small amount, you should invest whatever you can. “Start with having a percentage of your paycheck direct-deposited into a retirement account,” Rebell said. “Most accounts will let you increase your contribution automatically. So you can contribute 3% now, and a year from now it will automatically increase to 4%.” Invest in a tax-advantaged retirement plan. Many employers offer a 401(k) plan and will match part or all of your contributions. “If you invest $1 and your company matches that $1, you’re getting a 100% return on your investment,” Rebell said. “You’ll never get that rate of return anywhere else.” If your employer doesn’t offer a retirement plan, open an individual retirement account. You won’t get matching contributions from your employer, but you can still save for retirement and receive tax benefits. Increase your savings as your earnings increase. Every time you get a raise, increase the amount that you save so you can maximize your contributions during your peak earning years. By starting to invest now, automating savings and keeping financial goals in mind, millennials can set themselves up for a wealthier retirement. Click through to see surprising truths about millennials’ financial expectations . More on Investing Strategy How T o Invest In Stocks: A Beginner’s Guide As a Millennial, I Was Terrified of the Stock Market — How I Overcame My Fears 16 Unusual Money Moves That Could Set You Up for Life This article originally appeared on GOBankingRates.com : 43% of Millennials Aren’t Investing — and That’s a Problem |
Here’s the one thing Democratic candidates want you to remember about them after tonight’s debate
Top row, from left: Michael Bennet, Joe Biden, Pete Buttigieg, Kirsten Gillibrand, Kamala Harris. Bottom row, from left: John Hickenlooper, Bernie Sanders, Eric Swalwell, Marianne Williamson and Andrew Yang. (Yahoo News photo Illustration; photos: AP, Getty Images) Many people are in full summer mode, juggling new camp and childcare routines, taking vacations, reading fiction and trying to tune out the news. Only 1 out of 3 registered Democrats say they’ve been paying close attention to the primary so far, and that’s undoubtedly a higher percentage than among those who might vote but aren’t yet registered. On Thursday, however, a substantial number of people will set relaxation aside for a moment and divert their gaze in the direction of the pulsating ulcer that is American politics, especially since this is the night when the most top-tier candidates will appear. They will see a stage of 10 people who will get a total of between 10 and 15 minutes each to talk, with none of their moments in the spotlight lasting more than a minute or two. Candidates who have a central unifying idea, a clear and compelling case for their candidacy, and who perform in a way that projects strength and optimism, will stand out. Often, the more crystalline a candidate’s core idea, the more winning the candidate’s aura. Yahoo News asked all 10 campaigns a simple question: What's the one thing you want a casual observer to learn or remember about your candidate after they watch? The two most unequivocal answers came from Vermont Sen. Bernie Sanders and California Sen. Kamala Harris. Sanders wants voters to know that the Democratic Party has moved ideologically to where he’s always been, a senior campaign official said. The Sanders aide added that “he's the only candidate who believes we need to fundamentally change our political system.” It is an argument that Sanders is authentic, that he doesn’t develop his positions based on polling, and that he is willing to take a stand for what he believes even if it’s not popular at first. Sen. Bernie Sanders at the S.C. Democratic Convention in Columbia, S.C., on June 22. (Photo: Randall Hill/Reuters) The Sanders camp is also staking a claim to be the true representative of the modern progressive wing of the Democratic Party. It’s an argument for legitimacy, and an attempt to keep moving Sanders away from the perception that he is a fringe candidate whose ideas won’t be accepted by a broader audience in a general election. Story continues The Sanders message is also an assertion of leadership, that he is willing to do what is necessary even if it not always popular. Former Vice President Joe Biden’s campaign didn’t respond to the question. He is undoubtedly a known quantity to most Americans and is the clear leader at this point in the primary, though it is still very early. Also, everyone knows what Biden’s core message is: He’s the Democrats’ best shot to beat Trump. But Biden will be making a different kind of first impression Thursday night. There are serious questions about whether the 76-year-old is too out of touch with the modern party to last in this marathon primary, and whether he can win over a skeptical progressive base that embodies much of the energy on the left. This will be Biden’s first time face to face with his rivals, and Americans will get a chance to see if he looks like he can stand up to the test. That’s what made the response from Harris’s campaign interesting. The one thing the Harris campaign wants voters to know after Thursday night is that she is the “best candidate to prosecute the case against Trump,” said Harris spokesman Ian Sams. That’s a direct claim by the Harris camp to the lane of the primary that Uncle Joe is currently dominating: the centrist moderate alternative to the progressive wing, over which Sanders and Sen. Elizabeth Warren of Massachusetts are battling. And if Biden does fade, whether from death by a thousand cuts or some more sudden cause, Harris might be best situated to benefit and rise to the top. There are other moderate Democrats who are trying to elbow their way to the front of that centrist group: Sen. Amy Klobuchar of Minnesota, Sen. Cory Booker of New Jersey, Sen. Michael Bennet of Colorado, former Colorado Gov. John Hickenlooper and former Rep. John Delaney of Maryland among them. But the Harris campaign’s “one thing” answer shows it is leaning into her credentials as a former prosecutor, which is decidedly an appeal more to the middle of the party where Biden is popular than it is an attempt to win over Sanders or Warren voters. Sen. Kamala Harris with supporters. (Photo: Win McNamee/Getty Images) And Harris has the kind of charisma and personal profile as an African-American woman to win over large swaths from a wide variety of the Democratic Party’s biggest constituencies. The answer from Bennet to the “one thing” question demonstrated his straightforward sincerity, but also his limitations as a national figure. For a senator known for his intellectual prowess and curiosity, Bennet’s answer was noteworthy mostly for how simple it was. “I’d like to leave the impression that I’d be a good president and I’d tell the American people the truth,” Bennet told Yahoo News columnist Matt Bai. A number of campaigns didn’t respond, and there were a few potential reasons for that. They might not have a clear sense of what their core purpose or message is, or there might be disagreement among senior staff and the candidate about what it is. Potentially, it’s still being hashed out a day before the debate. These overarching statements that the campaigns were asked about may seem simple, but they dictate a lot about how candidates answer questions, what talking points they try to pivot to, and much more. The campaigns also might not have responded because they don’t want other campaigns to know their main objective of the night. That might say something about the candidates themselves, and their approach to how they want to engage and combat their foes on the stage. Campaigns or candidates that don’t want to show their cards may be unsure of how others will try to undermine them, or not confident enough in whether it’s the core message they’ll go with long-term. They may be road-testing it tonight but may be open to other core messages. That’s what makes it noteworthy that Sanders and Harris had no hesitation in sharing theirs. It’s a sign of confidence. One of Sanders’s most notable qualities as a candidate is his sense of certainty about who he is and what he stands for. It’s what made him so appealing in 2016 to many Democratic primary voters who found his candidacy more convincing than Hillary Clinton’s. And then a third reason for a nonresponse could have been that the campaign is too small or unorganized to come up with a response, or that it believes a response to a story like this just isn’t a priority. One campaign also provided two different answers to the same question. Rep. Eric Swalwell of California told Yahoo News on Twitter that he was focused on identifying with working class voters. Rep. Eric Swalwell, D-Calif., at the 2019 S.C. Democratic Party Convention. (Photo: Sean Rayford/Getty Images) “I hope they learn that I know why they work hard and what they expect it to add up to. I’m the son of a cop and first in my family to go to college. I benefited from a promise of work hard and do better. But I see the people who haven’t. I’m running for them,” Swalwell said. Meanwhile, a Swalwell spokeswoman relayed a focus on generational change. “Rep. Swalwell has a blend of youth and experience that distinguishes him from the rest of the field. Voters are looking for new energy and new ideas. Rep. Swalwell embodies that and has since he was elected to Congress in 2012 after defeating a 40-year incumbent,” said Swalwell spokeswoman Cait McNamee. And in the case of Pete Buttigieg, he and his campaign have been consumed for the last 10 days with trying to respond to the shooting of a black man by a white police officer in South Bend, Ind., where Buttigieg is mayor. More than any other candidate appearing on the debate stage Thursday night, the 37-year-old political phenom will likely be dealing with strong emotions about the situation back home, combined with the natural jitters any person would experience stepping into the white-hot lights of a nationally televised debate for the first time. Yahoo News sent Buttigieg’s campaign multiple messages, but did not hear back. _____ Read more from Yahoo News: Former top U.S. diplomat deplores policy toward Iran 'untethered to any coherent strategy' Pentagon secretly struck back against Iranian cyberspies targeting U.S. ships Trump admits his Cabinet had 'some clinkers' For Dems, there's no chickening out at Clyburn's fish fry Chore wars: Are men doing enough housework? PHOTOS: Moon rock samples sealed since Apollo missions |
GBP/USD Daily Forecast: Pound Falls in a Range
There was some strong downside momentum inGBP/USDon Tuesday after it failed to cross an important resistance level. That momentum has died down significantly as the pair has fallen into a range. On a 4-hour chart, the 100 and 200-period moving averages appear to be containing price action.
There are several factors that stand to impact the exchange rate over the short-term. To start, the final release of quarterly GDP out of the US is scheduled for release later today. As a final release, however, the data tends to not to have a significant impact, unless there is a big deviation from expectations.
What stands to have more of an impact on the US economy, and on US monetary policy, is the ongoing trade war between US and China. President Trump and China’s President Xi will be meeting later this week at the G20 summit taking place in Japan. I am speculating that there will be a drop in dollar volatility until the outcome of the meeting is announced.
Aside from the GPD data release today, there are a few other releases that pertain toGBP/USD. One that I will be watching is the US weekly unemployment claims. This figure rarely has a sustained move on the markets, however, it is a good indicator of how the jobs market is doing. This is particularly important when it comes to speculation of US monetary policy easing which has been a major driver for the greenback.
As mentioned,GBP/USDis trading between two moving averages on an hourly chart. I don’t see much oppurtunity here. I think it is easy for the pair to either fake out higher or lower at this stage.
If the pair moves higher, I expect that sellers will cap rallies at 1.2747 or perhaps even ahead of it, considering how important of a level it is. To the downside, I see some strong support at 1.2655.
The hourly chart shows the pressence of the 200-period moving average near the horizontal level, creating a bit of a confluence. I think that the markets will await the outcome of the G20 meeting before we start to see sustained moves inGBP/USD.
• GBP/USDhas been ranging, there is some data later today that might move the pair. A more likely catalyst for volatility is the result of the G20 meeting.
• On a 4-hour chart, the 100 and 200-period moving averages are containing the range.
Thisarticlewas originally posted on FX Empire
• Natural Gas Price Forecast – Natural gas markets run into exhaustion
• AUD/USD Weekly Price Forecast – Australian dollar has strong week
• Crude Oil Weekly Price Forecast – Crude oil markets rally for the week
• GBP/JPY Price Forecast – British pound rallies on Friday
• EUR/USD Weekly Price Forecast – Euro Powers higher
• Gold Weekly Price Forecast – Gold markets for massive shooting star |
Kalmar awarded with contract extension to operate internal logistics at a sawmill in Sweden
CARGOTEC CORPORATION, PRESS RELEASE, 27 JUNE 2019 AT 12 PM (EEST) Kalmar, part of Cargotec, has signed a five-year extension for comprehensive service agreement with large Swedish sawmill belonging to Nordic forestry corporation. The agreement, which includes the provision of Kalmar as well as third-party equipment, operators and maintenance services, was booked in Cargotec`s 2019 Q2 order intake and will come into effect at the end of Q3 2019. Under the service agreement, Kalmar will continue having full responsibility for the customer`s internal logistics operations, including the transportation of logs, sawn goods and other related products. Kalmar will provide all the necessary equipment, tools, professional resources and data driven analytics through Kalmar Insight Performance Management Software to ensure that the mill can run effectively and efficiently. The agreement also includes fuel for the equipment with a fuel-consumption guarantee to provide improved cost predictability for the customer.Martin Hall, Director, Service Operations, Kalmar North Europe: "Our successful track record at this site is built on highly dedicated efforts of our staff, and commitment to efficiency and operational excellence. Our customers can always rely on our commitment to continuous improvements by deploying state of the art tools and technologies constantly ensuring highest level of performance."Further information for the press:Martin Hall, Director, Service Operations, Kalmar North Europe, martin.hall@kalmarglobal.com Maija Eklöf, Vice President, Marketing and Communications, Kalmar, tel. +358 20 777 4096, maija.eklof@kalmarglobal.com Kalmar offers the widest range of cargo handling solutions and services to ports, terminals, distribution centres and to heavy industry. Kalmar is the industry forerunner in terminal automation and in energy efficient container handling, with one in four container movements around the globe being handled by a Kalmar solution. Through its extensive product portfolio, global service network and ability to enable a seamless integration of different terminal processes, Kalmar improves the efficiency of every move. www.kalmarglobal.com Kalmar is part of Cargotec. Cargotec`s (Nasdaq Helsinki: CGCBV) sales in 2018 totalled approximately EUR 3.3 billion and it employs around 12,000 people. www.cargotec.comImage 1Image 2
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: Cargotec Corporation via GlobeNewswireHUG#2246682 |
Alexandria Ocasio-Cortez learns to play the insider’s game
In Queens, she’s a storm-the-barricades political outsider. But back in Washington, Alexandria Ocasio-Cortez is working the system. Ocasio-Cortez once again confronted the powerful New York Democratic machine this week and won — helping propel a little-known, left-wing candidate to likely victory in Queens’ district attorney primary, over an establishment pick backed by some of her own colleagues. On Capitol Hill, however, Ocasio-Cortez met with Speaker Nancy Pelosi to reshape a contentious spending package for the southern border. And while the New York Democrat ultimately opposed the bill on the floor Tuesday, she declined to mobilize her army of social media followers against it or rile up the progressive base in a bid to tank it. The freshman firebrand later said that she and her progressive colleagues were “holding out as long as possible” against Democratic leaders to build leverage, a move that she said helped secure key policy wins. “We continued to hold out, and all of a sudden, what we were told was not possible was suddenly possible in order to secure these votes,” Ocasio Cortez said of the Congressional Progressive Caucus’ ability to change the bill. “We didn’t necessarily have the votes to stop the House version, but I think that’s why it’s important for us to record our objections to it,” she said. “I think we were actually very successful.” The latest episode over the border bill underscores Ocasio-Cortez’s approach to Congress six months into her hotly anticipated turn in Washington. The progressive star has indeed begun to exert power — but subtly and not the way most people expected. Despite many predictions to the contrary, she hasn’t opted to torment leadership as the conservative Freedom Caucus once did to GOP leaders. Instead, she’s working with party elders. It’s also a stark contrast from how she’s used her huge megaphone back home, where Ocasio-Cortez helped chase Amazon out of New York to the dismay of Democratic leaders and crown the next district attorney of Queens. And of course that’s after taking out former Rep. Joe Crowley — a potential future speaker — in a 2018 primary. Story continues In the 48-hour flurry of negotiations leading up to a vote on the spending package, Ocasio-Cortez inserted herself into the Democratic caucus’ efforts to respond to the humanitarian crisis at the border. On Monday night, she was among the last Democrats to leave the room in a late-night meeting with Pelosi where leadership agreed to include more protections for migrant children in detention. Some Democratic sources said that any role Ocasio-Cortez had in the border negotiations was minimal, noting that she did not personally secure policy wins and that Democratic leaders never counted on her to vote for the bill. Still, Ocasio-Cortez held no impromptu news conference on the Capitol lawn. She refrained from a tweetstorm. In fact, she didn’t write a single post about one of the biggest immigration debates so far under the Democratic majority. It’s a more tactical approach that stands in contrast to the bomb-throwing persona she and other freshman progressives have displayed on social media, where she’s directly challenged Democratic leadership and even called out some of her fellow colleagues by name. Meanwhile in Queens, Ocasio-Cortez hasn’t been afraid to spend her political capital. In the closely watched primary race for Queens’ top attorney, the New York Democrat delivered an early endorsement and helped rally support for public defender Tiffany Cabán. It was a direct challenge to the party favorite — Melinda Katz — who was championed by New York Gov. Andrew Cuomo and House Democrats like Rep. Gregory Meeks, who was tapped to be chairman of the Queens Democratic Party after Crowley was defeated last year. Several Democrats said they’ve seen a difference between Ocasio-Cortez’s Twitter persona and the congenial, soft-spoken colleague they have come to know in the past several months. At the caucus’ regular closed-door meetings, she isn’t confrontational. But lawmakers also acknowledged they’re waiting to see how Ocasio-Cortez handles the 2020 election cycle and whether she’ll work with progressive activists to try to oust some of her colleagues. Justice Democrats, the group that helped orchestrate Ocasio-Cortez’s victory over Crowley, plans to primary several Democratic incumbents. And several of Ocasio-Cortez’s New York colleagues already face primary challengers from the left, which has unnerved many in the party. “The jury is still out,” said Meeks, when asked about Ocasio-Cortez’s influence in Washington and Queens. “It will be interesting to see — because you’ve got to try to get along here — whether she decides, with colleagues that she’s worked with every day, whether she’s supporting them or not supporting them.” So far Ocasio-Cortez hasn’t directly waded into the primary battles, although she did appear in a video with Justice Democrats earlier this year calling on a new crop of activists to challenge incumbents. And her chief of staff, a Justice Democrats alum, urged his Twitter followers to donate earlier this month to the progressive candidate taking on Rep. Henry Cuellar (D-Texas). Tensions flared in March, when Ocasio-Cortez issued a warning to a group of her Democratic colleagues that they could wind up “on a list” of primary election targets after several moderates bucked the party on an immigration vote on the floor. Weeks later, she angered many of the same lawmakers as she urged her 4.5 million Twitter followers to halt their donations to the Democratic campaign arm because of a new policy boycotting consultants who work for Democratic primary challengers. The freshman has also shown no reluctance to harangue Trump administration officials from her perch on the Oversight Committee. In one viral exchange, she accused Commerce Secretary Wilbur Ross of lying about the decision to add a citizenship question for the census. That firepower hasn’t always translated into legislative wins on the floor. At the beginning of the new Congress, Democrats overwhelmingly approved a package of House rules over the vocal objections of Ocasio-Cortez and fellow progressive Rep. Ro Khanna (D-Calif.). Ocasio-Cortez, as well as the three other progressive freshmen in her squad who defied leadership in Tuesday night’s vote — Reps. Ayanna Pressley of Massachusetts, Rashida Tlaib of Michigan and Ilhan Omar of Minnesota — say they never seriously considered pushing the rest of their caucus to tank the bill, as they watched the effects of an ever-worsening border crisis. “We weren’t actively trying to whip a hard line against it, because we were in an extremely difficult situation,” Ocasio-Cortez said. “I’m not new to government or lawmaking. I understand that perfection cannot be the enemy of good,” Pressley added in an interview Wednesday. Some of her fellow Democrats say the difference between Ocasio-Cortez’s strategy back home in Queens and her approach in Washington simply reflects the way Congress works, where members can decide to make noise, but it might cost them their spot at the negotiating table. “This is one where, I think, across the board on the Democratic side, we all want what’s best for the kids. I detest how ICE operates, I’m with AOC completely,” Rep. Mark Pocan (D-Wis.) said of progressives’ efforts to improve the bill, rather than derail it. “There’s just so many provisions that, had we not been strategic, we might not have gotten.” |
Don't Sell Shrenik Limited (NSE:SHRENIK) Before You Read This
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll show how you can use Shrenik Limited's ( NSE:SHRENIK ) P/E ratio to inform your assessment of the investment opportunity. Shrenik has a price to earnings ratio of 68.21 , based on the last twelve months. That means that at current prices, buyers pay ₹68.21 for every ₹1 in trailing yearly profits. Check out our latest analysis for Shrenik How Do You Calculate A P/E Ratio? The formula for P/E is: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Shrenik: P/E of 68.21 = ₹74.35 ÷ ₹1.09 (Based on the year to March 2019.) Is A High Price-to-Earnings Ratio Good? The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. That is not a good or a bad thing per se , but a high P/E does imply buyers are optimistic about the future. How Growth Rates Impact P/E Ratios P/E ratios primarily reflect market expectations around earnings growth rates. When earnings grow, the 'E' increases, over time. That means even if the current P/E is high, it will reduce over time if the share price stays flat. Then, a lower P/E should attract more buyers, pushing the share price up. Notably, Shrenik grew EPS by a whopping 30% in the last year. And earnings per share have improved by 28% annually, over the last five years. With that performance, I would expect it to have an above average P/E ratio. How Does Shrenik's P/E Ratio Compare To Its Peers? One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. As you can see below, Shrenik has a much higher P/E than the average company (19.2) in the trade distributors industry. NSEI:SHRENIK Price Estimation Relative to Market, June 27th 2019 That means that the market expects Shrenik will outperform other companies in its industry. The market is optimistic about the future, but that doesn't guarantee future growth. So further research is always essential. I often monitor director buying and selling . Story continues Don't Forget: The P/E Does Not Account For Debt or Bank Deposits Don't forget that the P/E ratio considers market capitalization. That means it doesn't take debt or cash into account. Hypothetically, a company could reduce its future P/E ratio by spending its cash (or taking on debt) to achieve higher earnings. While growth expenditure doesn't always pay off, the point is that it is a good option to have; but one that the P/E ratio ignores. Shrenik's Balance Sheet Shrenik has net debt worth 21% of its market capitalization. It would probably deserve a higher P/E ratio if it was net cash, since it would have more options for growth. The Verdict On Shrenik's P/E Ratio With a P/E ratio of 68.2, Shrenik is expected to grow earnings very strongly in the years to come. While the company does use modest debt, its recent earnings growth is very good. Therefore, it's not particularly surprising that it has a above average P/E ratio. Investors have an opportunity when market expectations about a stock are wrong. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. We don't have analyst forecasts, but you might want to assess this data-rich visualization of earnings, revenue and cash flow. You might be able to find a better buy than Shrenik. If you want a selection of possible winners, check out this free list of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor 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. |
The corridors of powder: cocaine found in Houses of Parliament
The Houses of Parliament (REUTERS/Toby Melville) Traces of cocaine have been found in the Houses of Parliament. An investigation carried out by VICE found the Class A drug in four secure areas of the building. One of the areas with the highest levels of residue was in the toilets outside of the Strangers Bar, which is accessible to parliamentary passholders and visitors. VICE carried out tests in nine areas. The cocaine was found in four areas of the building (REUTERS) Rooms were swabbed with a testing kit consisting of pale pink wipes which turn blue if any trace of the drug is present. Other locations which tested positive were the disabled toilets outside The Woolsack, one of several bars in the Palace of Westminster, as well as two other bathrooms outside of MPs offices. It is not the first time cocaine has been found in Westminster. Back in 2013, an investigation by the Sun on Sunday found cocaine in various parts of the building. Many of parliament's passholders, thought to be as high as 13,000, are not members of the House of Commons or Lords, so it is not clear who will be using the drug. However, the latest revelation comes just weeks after revelations about drug use among high profile MPs. In response, a spokesperson for Parliament said the takes the issue of substance misuse was taken very seriously. Michael Gove, who recently admitted cocaine use when he was a journalist (Photo by Tolga AKMEN / AFP/Getty Images) Parliament is a public place and we welcome over a million visitors a year who have access to the facilities, said the spokesperson. Should drug use be identified in Parliament, appropriate action would be taken. Michael Gove , who unsuccessfully ran for prime minister in the current Conservative leadership elections, was forced to admit using cocaine on several occasions. Frontrunners Boris Johnson and Jeremy Hunt also admitted drug use in their past, while another prominent Tory, Rory Stewart, said he had smoked opium at a wedding in Iran. ---Watch the latest videos from Yahoo UK--- |
SIX Group asks Swiss central bank to issue stablecoin
Swiss stock exchange SIX Group has asked the Swiss central bank to issue a cryptocurrency for payment settlement,swissinfowrites. So far, the Swiss National Bank has treaded cautiously around cryptocurrencies.
Nonetheless, SIX would like to list a bank-issued, CHF-pegged stablecoin on SDX—its digital securities trading platform targeted at qualified investors, to be launched early next year. The exchange wants to use the token for settling securities payments between banks on the "wholesale" market. Token holders would also be able to exchange it for cash when needed.
“We most definitely favour a central bank issued stablecoin,” SIX said. They also outlined how member banks could benefit from using tokenised CHF (Swiss Francs) on the SDX platform to trade digitalised version of stocks, bonds, and securities.
"SDX would accept CHF payments from member banks in central bank money and issue equivalent tokenised CHF in SDX. The value of tokenised CHF would be pegged 1:1 with CHF at all times."
The bank confirmed they were in talks “about different options on how to settle the cash side” of trades. However, no agreement has been reached yet. |
Grab raises $300 million from asset manager Invesco to fuel growth
SINGAPORE (Reuters) - Grab has received an additional $300 million investment from asset manager Invesco Ltd <IVZ.N> as part of plans by Southeast Asia's biggest ride-hailing company to raise $6.5 billion in total capital this year. "The additional investment in Grab takes Invesco's overall total to $703 million and re-affirms its belief in Grab's vision and plan for the region," Grab said in a statement on Thursday. Softbank-backed <9984.T> Grab said in April that it was looking to raise another $2 billion this year to ramp up expansion, weeks after announcing over $4.5 billion of funding in Southeast Asia's largest round of private financing. "We have been closely watching Southeast Asia and have every confidence in Grab's ability to unlock new opportunities across on-demand mobility, delivery and financial services in the region," said Justin Leverenz, senior portfolio manager at Invesco Emerging Markets. Singapore-headquartered Grab, like its regional rival Go-Jek, has been raising billions of dollars to bring ride-hailing, food delivery, e-commerce and banking to a populous region with a growing number of consumers that use smartphones to commute, shop and make payments. (Reporting by Anshuman Daga; Editing by Himani Sarkar) |
Is Sonata Software Limited's (NSE:SONATSOFTW) 32% ROE Better Than Average?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand Sonata Software Limited (NSE:SONATSOFTW).
Over the last twelve monthsSonata Software has recorded a ROE of 32%. Another way to think of that is that for every ₹1 worth of equity in the company, it was able to earn ₹0.32.
View our latest analysis for Sonata Software
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Sonata Software:
32% = ₹2.5b ÷ ₹7.7b (Based on the trailing twelve months to March 2019.)
Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means ROE can be used to compare two businesses.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As is clear from the image below, Sonata Software has a better ROE than the average (12%) in the IT 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 debt used for growth will improve returns, but won't affect the total equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Sonata Software has a debt to equity ratio of just 0.02, which is very low. When I see a high ROE, fuelled by only modest debt, I suspect 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 a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
Of courseSonata Software 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. |
Sonata Software Limited (NSE:SONATSOFTW) 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. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Sonata Software Limited (NSE:SONATSOFTW).
Over the last twelve monthsSonata Software has recorded a ROE of 32%. Another way to think of that is that for every ₹1 worth of equity in the company, it was able to earn ₹0.32.
Check out our latest analysis for Sonata Software
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Sonata Software:
32% = ₹2.5b ÷ ₹7.7b (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 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 looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the amount earned after tax over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal,investors should like a high ROE. That means ROE can be used to compare two businesses.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. Pleasingly, Sonata Software has a superior ROE than the average (12%) company in the IT industry.
That's what I like to see. I usually take a closer look when a company has a better ROE than industry peers. One data point to check is ifinsiders have bought shares recently.
Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Sonata Software has a debt to equity ratio of just 0.02, which is very low. The combination of modest debt and a very impressive ROE does suggest that the business is high quality. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is useful for comparing the quality of different businesses. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better.
But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
But note:Sonata Software 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. |
Japan warns next UK prime minister to avoid no-deal Brexit
Boris Johnson, UK foreign secretary with his Japanese counterpart Taro Kono. Photo: AP Photo/Kirsty Wigglesworth Japan’s foreign minister has warned the UK could lose Japanese investment if the next prime minister takes Britain out of the EU without a deal. Taro Kono issued a stark plea to Tory leadership contenders Boris Johnson and Jeremy Hunt to avoid a no-deal Brexit that could put Japanese car firms’ survival in the UK at risk. “Please, no no-deal Brexit,” Kono told BBC Radio 4’s Today programme, in the latest of a string of interventions in the Brexit debate by the Japanese government. Japan is one of the biggest investors in the UK economy, with its car firms Nissan, Toyota and Honda building around half of the cars manufactured in Britain last year. READ MORE: UK firms warn no-deal Brexit posturing is already costing jobs Kono said Britain could see less investment from Japan if the next UK prime minister failed to protect free UK access to the EU market. He said a no-deal Brexit could lead to new physical customs checks at borders, putting the car industry’s ‘just-in-time’ production at risk. "Some companies are already starting to move their operations to other places in Europe," he said. Both Boris Johnson and Jeremy Hunt have said they are prepared to take Britain out of the EU without a deal. Workers at Nissan's plant in Sunderland. Photo: Press Association Japanese firms employ an estimated 150,000 people in Britain, while trade between the UK and Japan was worth around £28bn last year. UK prime minister Theresa May called the two countries “natural partners” as she welcomed her Japanese counterpart Shinzo Abe to the UK earlier this year. Abe used the visit to warn the “whole world” wanted Britain to avoid a no-deal outcome, and pledged “total support” for the agreement reached by May with Brussels. The Japanese foreign ministry also released a 15-page document in the year of the referendum in 2016 setting out how the UK economy could be damaged if Britain crashed out of the EU single market. |
Why We’re Not Impressed By Sophos Group plc’s (LON:SOPH) 7.0% ROCE
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Today we'll look at Sophos Group plc (LON:SOPH) and reflect on its potential as an investment. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business.
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 metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its 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'.
Analysts use this formula to calculate return on capital employed:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for Sophos Group:
0.07 = US$56m ÷ (US$1.4b - US$572m) (Based on the trailing twelve months to March 2019.)
Therefore,Sophos Group has an ROCE of 7.0%.
See our latest analysis for Sophos Group
ROCE can be useful when making comparisons, such as between similar companies. Using our data, Sophos Group's ROCE appears to be significantly below the 9.6% average in the Software industry. This could be seen as a negative, as it suggests some competitors may be employing their capital more efficiently. Aside from the industry comparison, Sophos Group'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.
In our analysis, Sophos Group's ROCE appears to be 7.0%, compared to 3 years ago, when its ROCE was 1.3%. This makes us think about whether the company has been reinvesting shrewdly. You can see in the image below how Sophos Group's ROCE compares to its industry. Click to see more on past growth.
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 only a point-in-time measure. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company.
Current liabilities are short term bills and invoices that need to be paid in 12 months or less. Due to the way ROCE is calculated, a high level of current liabilities makes a company look as though it has less capital employed, and thus can (sometimes unfairly) boost the ROCE. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets.
Sophos Group has total liabilities of US$572m and total assets of US$1.4b. Therefore its current liabilities are equivalent to approximately 42% of its total assets. Sophos Group's ROCE is improved somewhat by its moderate amount of current liabilities.
With this level of liabilities and a mediocre ROCE, there are potentially better investments out there. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Another Indian Crypto Exchange Shuts Down Blaming Banking Ban
Regulatory uncertainty ushered in by India’s central bank appears to have brought about the demise of another cryptocurrency exchange in the nation.
In aMedium postpublished Thursday, the Koinex exchange says it’s been forced to shutter its services as a de facto ban on banking relationships for crypto firms –orderedby the Reserve Bank of India (RBI) in April 2018 – has meant that it is economically unfeasible to continue with normal business.
The exchange writes:
Related:Singapore Exchange Bitrue Hacked for Over $4 Million in Crypto
While the RBI banking ban is being challenged in the Supreme Court, a lack of clear direction from the government has meant that the case is currently in limbo until a decision is made.
Last September, India’s then-largest crypto exchange by trading volume, Zebpay, was alsoforced to shut downciting the RBI restrictions.
A government panel has reportedly been meeting to try and decide a path forward for crypto regulation in India withtotal prohibition being possibly on the table.
Related:Six Arrested Over Cloned Crypto Exchange That Stole €24 Million
Koinex further said that a news report about proposed Indian legislation called the ‘Banning of Cryptocurrencies and Regulation of Official Digital Currencies Bill 2019’ has created nervousness among customers and caused trading to further drop off.
The article “has created enough FUD in the Indian crypto trading community to result into a sharp decline in trading volumes and [instill] a clear discomfort for all the law-abiding citizens of this great nation.”
As a result of the difficulties, the exchange permanently ceased trading services at 2.00 p.m. local time (08:30 UTC) Thursday, June 27.
Koinex explained:
“A snapshot of the wallet balances at this time will be taken for record, and the effort to disburse [Indian rupee] balances will begin immediately. Since the bank accounts with user funds are still frozen and the capital is held up, we have made arrangements for funds from our own resources, so that we return as much as we possibly can, back to our users and alleviate their position in reference to the funds held up in these frozen accounts.”
It also pointed out that this action is voluntary, and is “being undertaken … only with a view to reduce the hardship that it is causing to so many of the users who reposed faith and supported our business effort while things were not constrained.”
The exchange added:
“This is our way of saying ‘thank you’ and bidding adieu.”
Closed signimage via Shutterstock
• Mt Gox Founder Hit With Lawsuit Over Alleged Fraudulent Misrepresentation
• Swiss Central Banker ‘Relaxed’ About Facebook’s Libra Crypto |
Oil Price Fundamental Daily Forecast – Position-Trimming Likely Ahead of Trump-Xi Meeting
U.S. West Texas Intermediate and international-benchmark Brent crude oil futures are edging lower on Thursday as investors book profits and trim positions ahead of this weekend’s meeting between U.S. President Trump and Chinese President Xi Jinping at the G-20 summit in Osaka, Japan. General uncertainty ahead of an OPEC meeting is also encouraging investors to lighten up a little on the long-side.
At 08:38 GMT,August WTI crude oilis trading $58.94, down $0.44 or -0.72% andSeptember Brent futuresare at $65.13, down $0.56 or -0.85%.
While some may argue that the Middle East tensions between the United States and Iran are the catalysts behind the price action this week, I have to say that that they are more likely underpinning the markets rather than driving prices higher this week. Tensions have eased this week, but not enough to disappear. However, they should remain a safety net for investors looking to play the long-side of the market. This issue is important for the supply side of the equation.
The key issue affecting the demand side is the meeting between Trump and Xi. Demand is the issue because the inability to make a trade deal, or an escalation of the U.S. tariffs on China could lead to a global recession and this likely means lower demand for crude oil.
Trump keeps talking like he’s not expecting much from the meeting. Some feel that all he wants to do is take the temperature of the Chinese government. This has created an air of uncertainty. Trump has even said that he’ll consider an additional $300 billion of new tariffs on China after the meeting. In the meantime, Treasury Secretary Mnuchin told CNBC on Wednesday that the two countries were very close to a deal in May and just have to get back to the negotiations table.
Trump and Xi surprised the markets in early December by announcing the start of trade talks. They may still have this card of their sleeves when they meet again on Saturday. And that would be good for oil prices because it would, at least temporarily, ease some of the worries over future demand.
This weekend’s meeting between OPEC and its allies hasn’t been in the news much lately because investors believe the deal to cut production, trim excessive oil inventories and stabilize prices is likely to be extended until the end of the year.
This is bullish for prices because it reduces supply. We already know it works and has been working since January 1. So this is another event that has the capability of underpinning prices.
There was more bullish supply news on Wednesday. The U.S. Energy Information Administration (EIA) announced U.S. crude stockpiles fell 12.8 million barrels the week-ending June 21. Traders were looking for a decrease of 2.5 million barrels.
This week’s fundamentals have been bullish and traders have responded accordingly. However, the meeting between the Trump and Xi is an uncertainty and investors tend to sell when there is uncertainty. I don’t expect to see heavy shorting until there is a bearish surprise, but given the recent run-up in prices, it seems reasonable that investors may feel the need to take profits or trim long positions.
Thisarticlewas originally posted on FX Empire
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Is TAJGVK Hotels & Resorts Limited's (NSE:TAJGVK) 6.9% ROE Better Than Average?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. By way of learning-by-doing, we'll look at ROE to gain a better understanding of TAJGVK Hotels & Resorts Limited (NSE:TAJGVK).
Over the last twelve monthsTAJGVK Hotels & Resorts has recorded a ROE of 6.9%. That means that for every ₹1 worth of shareholders' equity, it generated ₹0.069 in profit.
Check out our latest analysis for TAJGVK Hotels & Resorts
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for TAJGVK Hotels & Resorts:
6.9% = ₹272m ÷ ₹3.9b (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.
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. 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.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. The image below shows that TAJGVK Hotels & Resorts has an ROE that is roughly in line with the Hospitality industry average (6.9%).
That's neither particularly good, nor bad. ROE can give us a view about company quality, but many investors also look to other factors, such as whether there are insiders buying shares. If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Virtually all companies need money to invest in the business, to grow profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used.
TAJGVK Hotels & Resorts has a debt to equity ratio of 0.52, which is far from excessive. Its ROE is quite low, and the company already has some debt, so surely shareholders are hoping for an improvement. 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. All else being equal, a higher ROE is better.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. 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 courseTAJGVK Hotels & Resorts 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. |
Donald Trump fires back at Megan Rapinoe in tweet storm
Megan Rapinoe and Donald Trump are going round-and-round about protesting during the national anthem and visiting the White House. (Getty Images) United States Women’s National Team star Megan Rapinoe and President Donald Trump are continuing to go round-and-round about protesting during the national anthem and visiting the White House. On Wednesday Trump fired back at Rapinoe for her comment about not wanting to visit the White House, using his very favourite social media platform, Twitter. To quickly recap this kerfuffle, Rapinoe has chosen to stay silent during the national anthem to protest injustice and inequality, which she’s been doing for several years. Her practice of silence has come into the spotlight during the Women’s World Cup, and Trump recently said that he doesn’t believe it’s appropriate for her to protest during the anthem. READ MORE: Meet ‘maybe megan rapinoe,’ the victim of Trump’s Twitter incompetence Eight by Eight magazine then released a months-old video of Rapinoe saying definitively: “I’m not going to the f---ing White House... We’re not going to be invited. I doubt it.” Now that you’re all caught up, here’s what Trump tweeted on Wednesday morning. Women’s soccer player, @mPinoe , just stated that she is “not going to the F...ing White House if we win.” Other than the NBA, which now refuses to call owners, owners (please explain that I just got Criminal Justice Reform passed, Black unemployment is at the lowest level... — Donald J. Trump (@realDonaldTrump) June 26, 2019 ....in our Country’s history, and the poverty index is also best number EVER), leagues and teams love coming to the White House. I am a big fan of the American Team, and Women’s Soccer, but Megan should WIN first before she TALKS! Finish the job! We haven’t yet.... — Donald J. Trump (@realDonaldTrump) June 26, 2019 ....invited Megan or the team, but I am now inviting the TEAM, win or lose. Megan should never disrespect our Country, the White House, or our Flag, especially since so much has been done for her & the team. Be proud of the Flag that you wear. The USA is doing GREAT! — Donald J. Trump (@realDonaldTrump) June 26, 2019 As always, there’s a lot to unpack. Trump starts by talking about Rapinoe, but quickly pivots to the NBA, pointing at the refusal by the Golden State Warriors to visit the White House after their NBA championship. Story continues He then mentions NBA commissioner Adam Silver wanting team owners to be called ‘governors’ due to the slavery connection of the word ‘owner,’ and goes off on a tangent about ‘Criminal Justice Reform,’ ‘Black unemployment,’ and the poverty index. None of that is about Megan Rapinoe. He comes back to the topic at hand by professing his fandom for the “American Team,” chastises Rapinoe for mentioning a White House visit before the USWNT wins the Women’s World Cup, then he throws all of that out the window and invites the USWNT to the White House, win or lose. Of course, he ends by scolding Rapinoe about being ‘disrespectful’ through her protests, and telling her to ‘be proud of the flag that you wear.’ Of course, Rapinoe has already visited the White House, and been visibly proud of the flag that she wears. But things were a little different in 2015. Please nobody show him Megan's 2015 selfie. pic.twitter.com/Bc2r7LoKos — Slade (@Slade) June 26, 2019 Rapinoe has already made her feelings about visiting this current White House abundantly clear, and it doesn’t seem like an invitation from the man she’s called ‘misogynistic,’ ‘small-minded,’ and ‘racist’ will change her mind. And beyond all of that, that three-tweet thread was his second attempt. He had to delete them the first time around because he made a critical mistake in the first tweet, tagging a different Megan Rapino who is not the footballer. (She even spells her name differently.) The mentions of this Megan Rapino are likely a garbage fire now, but she was able to maintain her sense of humour and totally own the guy who made them that way. Once Trump tagged her, she looked at her sudden explosion of notifications and thought: “Oh, no, what did I do?” “I was like, I’m not doing anything interesting,” she told Yahoo Sports with a laugh. “Don’t follow this account.” “I thought it would stop. It hasn’t. It’s funny.” Who knew it was possible to dunk on someone in soccer? pic.twitter.com/G45RoW7cKb — James Poniewozik (@poniewozik) June 26, 2019 Trump has somehow made an enemy of two different Megans Rapino/Rapinoe. That’s not easy to do. More from Yahoo Sports: Rapinoe: ‘I’m not going to the f---ing White House’ Machado feels the love in his return to Baltimore Iggy says Warriors called fractured leg a ‘bruise’ Women’s World Cup is succeeding, no thanks to FIFA |
Al Qaeda’s Master Terrorists Are Still on Facebook and YouTube
Photo Illustration by The Daily Beast/Getty/Facebook In 2006, Ibrahim Suleiman al-Rubaish was repatriated to Saudi Arabia from Guantanamo Bay after he’d served more than five years as an enemy combatant for training with al Qaeda , and fighting alongside the Taliban in Afghanistan against the United States. Released as part of the Obama administration’s plans to shutter the offshore prison, Rubaish was admitted to Riyadh’s rather lackluster “deradicalization” program. Then, sometime in 2009, he escaped the program and Saudi Arabia with 11 other jihadists. They all turned up in Yemen and Rubaish soon emerged as the mufti, or Islamic jurist, for al Qaeda in the Arabian Peninsula (AQAP) where he spent the next six years appearing in propaganda videos for the group’s media outlet Al-Malahem , as well as releasing a number of fatwas and articles for other al Qaeda outlets including the English-language Inspire magazine. Facebook Co-Founder Calls Its Cryptocurrency Plans ‘Frightening’ Rubaish was killed in a U.S. drone strike in Yemen in 2015. But his ideas and legacy live on through his sermons and speeches, still hosted on Facebook and YouTube. Rubaish is joined in digital preservation by other leading lights in jihadist proselytization and virtual recruitment such as Abu Mus’ab al-Suri , the strategist behind the expansion of al Qaeda into Yemen, who helped invent what’s now commonly known as the “lone-wolf” terror attack; Nasir al-Wuhayshi, the leader of AQAP and the second-in command to Ayman al-Zawahiri, al Qaeda’s global head; and Anwar al-Awlaki , the main cleric for AQAP who is considered by counterterrorism experts to be, even from beyond the grave, one of the primary drivers of those lone-wolf attacks. Taken together, Rubaish, Suri, Wuhayshi and Awlaki can still be found in 105 videos on both social media platforms, despite corporate avowals that this stuff was fast becoming a thing of the past. Yet we identified the videos through simple searches in Arabic using only the names of these prominent jihadists. At a minimum, this demonstrates that Silicon Valley’s much-touted counter-extremism policies—now being applied to fascist and neo-Nazi content—aren’t using rigorous enough standards in classifying terrorist indoctrination materials; or they’ve simply reached the limits of what their algorithms or human monitors can handle in languages other than English. Or both. The videos we uncovered are primarily speeches given by Rubaish, Suri, Wuhayshi and Awlaki over the last several years, all devoted to jihadist strategy and theology, spread through individual users as well as public pages and groups. All told, the 105 videos have garnered more than 190,000 views. Of the al Qaeda quartet only one still has a dedicated Facebook page with 46 videos uploaded for public viewing. Story continues Contacted yesterday, Facebook said it was looking into the videos that we highlighted on its platform; YouTube did not respond to our queries in time for publication. Suri’s lessons in jihad, many of them recorded in the early 2000s, were focused on the key points from his playbook, Global Islamic Resistance Call. They total some five hours and 45 minutes of footage on the virtual shrine to him still visible on Mark Zuckerberg’s software. The most-watched video is his half-hour history on the invasions and subsequent injustices that the Muslim world has faced; it seems to have been recorded somewhere in Europe, as he refers to the “Christian world here in Europe.” Suri has Spanish citizenship and between 1994 and 1996 he lived in the London suburb of Neasden. Following the London bombings of 2005, he released a statement praising the selection of mass transit as a major, legitimate soft target. He is arguably al Qaeda’s foremost dialectician; Suri sought to encourage anyone with the will and means to commits acts of terror to do so in order to precipitate a backlash against Muslims in Europe, pushing them into the arms of the jihadists. This strategy has indeed succeeded, perhaps more than Suri ever anticipated. (After being captured by Pakistan authorities, Suri was supposedly the “ghost prisoner” in a secret U.S. detention facility before being rendered to Syria and was then rumored to have been released from prison by the Assad regime sometime in 2012. His whereabouts remain unknown.) The Master Terrorist We Gave Away Facebook claimed last year to have removed 99 percent of “terror content” before it was reported by third parties. In the first three months of 2019, YouTube said it removed 89,968 videos that violated its violent extremism policy. One of the most prevalent results of this cull is the scraping of Awlaki content in both Arabic and English. The name of the AQAP cleric used to yield 40,000 hits on YouTube . Today, both Facebook and YouTube have managed to eliminate most of them—but not all. We identified seven Awlaki speeches across both platforms, in Arabic. One, a gauzy depiction of the afterlife, which also glorifies Awlaki’s time on earth and his demise by American drone strike in Yemen in 2011, has been viewed 4,400 times since January. Born in the New Mexico and once platformed by U.S. authorities as an exponent of moderate Islam, Awlaki’s message is essentially that true Islam is incapable of being practiced or espoused in the U.S. and thus this serves as a justification for holy war against the country and its interests. The video has been shared 23 times across the platform; the comments are wholly supportive. (Awlaki’s also proved impossible to suppress in English. In the past two years, a number of YouTube accounts have been posting his lectures in his native tongue via two primary playlists, collectively composed of 174 videos. These playlists even highlight their banned status on YouTube to excite further interest, which seems to have worked: collectively they’ve been viewed 300,000 times.) Multimedia has traditionally been a boom business for jihadists for an obvious reason: it’s an incredibly easy way for non-state actors to cross state boundaries in milliseconds and radicalize and recruit new followers without even meeting them. Awlaki’s speeches were instrumental in coaxing Umar Farouk Abdulmutallab , who visited the cleric in Yemen while still an engineering student at University College London, to try to detonate a bomb sewn into his underwear while onboard a plane to Detroit in 2009. Suri was linked to the 2004 Madrid train bombers , and his work has inspired those in ISIS to call for “lone wolf” attacks in the West. Rubaish agitated for killing anyone who insults the Prophet. AQAP later took responsibility for operationalizing the Charlie Hebdo massacre in Paris. And that’s why Facebook and YouTube have submitted to government pressure to scrub their sites of radical content. Yet it’s evidently easier to play Whac-A-Mole in English than in Arabic, the lingua franca of jihad. If social media companies are to make good on their counter-extremism policy, they’ll need a more comprehensive—and polyglot—approach. 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. View comments |
Should You Consider Unilever N.V. (AMS:UNA)?
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I've been keeping an eye on Unilever N.V. (AMS:UNA) because I'm attracted to its fundamentals. Looking at the company as a whole, as a potential stock investment, I believe UNA has a lot to offer. Basically, it is a notable dividend payer with a a great track record of delivering benchmark-beating performance. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, read the fullreport on Unilever here.
UNA delivered a bottom-line expansion of 55% in the prior year, with its most recent earnings level surpassing its average level over the last five years. Not only did UNA outperformed its past performance, its growth also surpassed the Personal Products industry expansion, which generated a 11% earnings growth. This is what investors like to see!
UNA 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 Unilever, I've compiled three fundamental aspects you should further examine:
1. Future Outlook: What are well-informed industry analysts predicting for UNA’s future growth? Take a look at ourfree research report of analyst consensusfor UNA’s outlook.
2. Financial Health: Are UNA’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 UNA? 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. |
What Kind Of Shareholders Own Unilever N.V. (AMS:UNA)?
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If you want to know who really controls Unilever N.V. (AMS:UNA), then you'll have to look at the makeup of its share registry. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. We also tend to see lower insider ownership in companies that were previously publicly owned.
Unilever is a pretty big company. It has a market capitalization of €140b. Normally institutions would own a significant portion of a company this size. Taking a look at our data on the ownership groups (below), it's seems that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholder can tell us about UNA.
View our latest analysis for Unilever
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
As you can see, institutional investors own 26% of Unilever. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Unilever's historic earnings and revenue, below, but keep in mind there's always more to the story.
We note that hedge funds don't have a meaningful investment in Unilever. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
Our information suggests that Unilever N.V. insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own €134m of stock. It is always good to see at least some insider ownership, but it might be worth checkingif those insiders have been selling.
With a 25% ownership, the general public have some degree of sway over UNA. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
We can see that Private Companies own 49%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
It's always worth thinking about the different groups who own shares in a company. But to understand Unilever better, we need to consider many other factors.
I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph.
If you would prefer discover what analysts are predicting in terms of future growth, do not miss thisfreereport on analyst forecasts.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Hackers steal $4.2 million from cryptocurrency exchange Bitrue
Singaporean cryptocurrency exchange Bitrue has been hacked, with the perps making off with roughly $4.2 million worth of cryptocoins XRP and ADA.
The incident happened at 1 a.m. GMT+8 on June 27, with the hacker exploiting a vulnerability in the company's "Risk Control team's 2nd review process to access the personal funds of about 90 Bitrue users," the company said on Twitter.
At approximately 1am June 27 (GMT+8), a hacker exploited a vulnerability in our Risk Control team's 2nd review process to access the personal funds of about 90 Bitrue users.
More aboutHack,Cryptocurrency,Ada,Xrp, andBitrue |
Asia Coffee: Vietnam prices inch higher as supply runs low
By Phuong Nguyen and Mas Alina Arifin
HANOI/BANDAR LAMPUNG (Reuters) - Coffee prices in Vietnam edged higher this week on low supplies, while trading activity picked up in Indonesia where a major harvest was in full swing.
Farmers in the Central Highlands, Vietnam's largest coffee growing area, sold coffee at 35,000 dong ($1.50) per kg on Thursday, compared with 33,000-34,000 dong a week earlier.
Supplies from farmers ran low and farmers were not keen to sell below 35,000 dong per kg, said a market analyst based in the Central Highlands.
Traders said almost no new deals were made this week, except for those trying to purchase beans for their export contracts signed earlier.
Traders in Vietnam offered 5% black and broken grade 2 robusta at a $110-$120 per tonne premium to the November contract. The premium was $100 to the September contract last week.
September robusta coffee settled up $10, or 0.6%, at $1,444 per tonne on Thursday.
Meanwhile, Indonesia's grade 4 defect 80 robusta beans were offered at a $180 premium to the September contract, compared with last week's $150 to $180 premium, a trader in the Sumatran province of Lampung said.
"Trade is getting more stable," the trader said, due to steadier supply as the coffee harvest there progresses.
The trader said around 1,000 tonnes of beans had been transacted daily so far this week.
($1 = 23,327 dong)
(Reporting by Phuong Nguyen in HANOI and Mas Alina Arifin in BANDAR LAMPUNG; Editing by Subhranshu Sahu) |
Based On Its ROE, Is Ultra Electronics Holdings plc (LON:ULE) A High Quality Stock?
Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! 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 Ultra Electronics Holdings plc ( LON:ULE ), by way of a worked example. Over the last twelve months Ultra Electronics Holdings has recorded a ROE of 7.7% . One way to conceptualize this, is that for each £1 of shareholders' equity it has, the company made £0.077 in profit. See our latest analysis for Ultra Electronics Holdings How Do You Calculate Return On Equity? The formula for ROE is: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Ultra Electronics Holdings: 7.7% = UK£32m ÷ UK£421m (Based on the trailing twelve months to December 2018.) Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all earnings retained by the company, plus any capital paid in by shareholders. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company. What Does ROE Mean? 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, as a general rule, a high ROE is a good thing . That means ROE can be used to compare two businesses. Does Ultra Electronics Holdings Have A Good Return On Equity? By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. If you look at the image below, you can see Ultra Electronics Holdings has a lower ROE than the average (9.9%) in the Aerospace & Defense industry classification. Story continues LSE:ULE Past Revenue and Net Income, June 27th 2019 That's not what we like to see. We prefer it when the ROE of a company is above the industry average, but it's not the be-all and end-all if it is lower. Nonetheless, it could be useful to double-check if insiders have sold shares recently . Why You Should Consider Debt When Looking At ROE Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Combining Ultra Electronics Holdings's Debt And Its 7.7% Return On Equity Ultra Electronics Holdings has a debt to equity ratio of 0.60, which is far from excessive. I'm not impressed with its ROE, but the debt levels are not too high, indicating the business has decent prospects. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises. The Key Takeaway Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt. But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREE visualization of analyst forecasts for the company . Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list 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 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. |
Can Ultra Electronics Holdings plc (LON:ULE) Improve Its Returns?
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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 Ultra Electronics Holdings plc (LON:ULE).
Over the last twelve monthsUltra Electronics Holdings has recorded a ROE of 7.7%. One way to conceptualize this, is that for each £1 of shareholders' equity it has, the company made £0.077 in profit.
Check out our latest analysis for Ultra Electronics Holdings
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Ultra Electronics Holdings:
7.7% = UK£32m ÷ UK£421m (Based on the trailing twelve months to December 2018.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the yearly profit. That means that the higher the ROE, the more profitable the company is. So, all else being equal,a high ROE is better than a low one. That means ROE can be used to compare two businesses.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As shown in the graphic below, Ultra Electronics Holdings has a lower ROE than the average (9.9%) in the Aerospace & Defense industry classification.
That's not what we like to see. We prefer it when the ROE of a company is above the industry average, but it's not the be-all and end-all if it is lower. Nonetheless, it could be useful todouble-check if insiders have sold shares recently.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the 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.
Ultra Electronics Holdings has a debt to equity ratio of 0.60, which is far from excessive. Although the ROE isn't overly impressive, the debt load is modest, suggesting the business has potential. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is 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. All else being equal, a higher ROE is better.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
But note:Ultra Electronics Holdings 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. |
Do You Like STL Global Limited (NSE:SGL) At This P/E Ratio?
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The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). We'll show how you can use STL Global Limited's (NSE:SGL) P/E ratio to inform your assessment of the investment opportunity.What is STL Global's P/E ratio?Well, based on the last twelve months it is 0.68. That corresponds to an earnings yield of approximately 147%.
See our latest analysis for STL Global
Theformula for P/Eis:
Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Or for STL Global:
P/E of 0.68 = ₹10.95 ÷ ₹16.04 (Based on the trailing twelve months to March 2019.)
A higher P/E ratio means that investors are payinga higher pricefor each ₹1 of company earnings. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.'
P/E ratios primarily reflect market expectations around earnings growth rates. That's because companies that grow earnings per share quickly will rapidly increase the 'E' in the equation. That means even if the current P/E is high, it will reduce over time if the share price stays flat. So while a stock may look expensive based on past earnings, it could be cheap based on future earnings.
Notably, STL Global grew EPS by a whopping 40% in the last year.
The P/E ratio indicates whether the market has higher or lower expectations of a company. We can see in the image below that the average P/E (10.9) for companies in the luxury industry is higher than STL Global's P/E.
Its relatively low P/E ratio indicates that STL Global shareholders think it will struggle to do as well as other companies in its industry classification. Since the market seems unimpressed with STL Global, it's quite possible it could surprise on the upside. 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. That means it doesn't take debt or cash into account. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth.
Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio.
STL Global's net debt is considerable, at 200% of its market cap. This level of debt justifies a relatively low P/E, so remain cognizant of the debt, if you're comparing it to other stocks.
STL Global trades on a P/E ratio of 0.7, which is below the IN market average of 15.4. The company may have significant debt, but EPS growth was good last year. If it continues to grow, then the current low P/E may prove to be unjustified.
Investors have an opportunity when market expectations about a stock are wrong. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. We don't have analyst forecasts, but shareholders might want to examinethis detailed historical graphof earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
UPDATE 1-Macron says he warned Iran's Rouhani about breaking nuclear commitments
(Adds quotes, context, Paris meeting)
TOKYO, June 27 (Reuters) - French President Emmanuel Macron warned Iran on Thursday not to quit its 2015 nuclear deal or give signals that it intended to do so, and said he would discuss efforts to avoid military escalation with U.S. President Donald Trump.
U.S. allies in Europe have been alarmed by an escalation between the United States and Iran in recent weeks, which culminated last week when Trump ordered air strikes only to call them off minutes before impact.
Washington, which quit an agreement last year under which Iran accepted curbs on its nuclear programme in return for access to world trade, has sharply tightened sanctions since May. Iran has responded by saying it could take steps that would violate the nuclear deal.
The crisis took on a military dimension in recent weeks, with Washington blaming Tehran for attacks on ships in the Gulf, and Iran shooting down a U.S. drone. Iran denies blame for the attacks on ships and says the drone was in its air space when it was struck. Washington says it was in international skies.
European countries, which disagreed with the U.S. decision to withdraw from the pact but share U.S. concerns about Iranian behaviour, have been caught in the middle, expressing increasing concern that a mistake on either side could trigger war.
Macron said he had two priorities: keeping Iran inside the nuclear deal and avoiding military escalation.
"Tensions are growing and for me the first element is that there is no exit from the framework. The second thing, and I will discuss it with president (Trump) tomorrow, is to do everything to avoid a military escalation," Macron said.
"I had a conversation with President (Hassan) Rouhani a couple of days ago and I indicated that any exit from the accord would be an error and any signals in that direction would be an error," Macron told reporters.
He said France believed the U.S. drone was over international waters when it was shot down, "so that was an aggression which was one more step in this escalation".
Tehran has said it intends to continue to abide by the nuclear agreement, but cannot do so indefinitely if it receives no economic benefits. It has set a number of deadlines in recent weeks for European countries to shield it from U.S. sanctions or it will take steps that could ultimately violate it.
One of those deadlines expires on Thursday, when Iran has said it could accumulate more than the maximum stockpile of low-enriched uranium allowable under the deal. Diplomats have told Reuters that Iran is still short of that threshold but on course to reach it in coming days.
Senior diplomats from the European powers are due to meet the U.S. special envoy on Iran in Paris on Thursday. Macron said officials were working on ways to improve the nuclear deal.
Washington says the nuclear deal, agreed under Trump's predecessor Barack Obama, is too weak because it is not permanent and does not cover areas outside of nuclear activity such as Iran's missile programme and regional behaviour.
Trump has invited Iran to talks "without pre-conditions". Iran says it cannot negotiate unless the United States accepts the agreement it already signed and lifts the sanctions. (Reporting by Christopher Gallagher; Writing by John Irish; Editing by Sudip Kar-Gupta) |
The Funniest Late-Night TV Takes On The 2020 Democratic Debate
The first Democratic 2020 presidential debate provided late night TV hosts with plenty of comic fodder on Wednesday. Viral moments, including former Texas Rep. Beto O’Rourke’s answering a question in Spanish , Minnesota Sen. Amy Klobuchar’s perpetually running down the clock, and President Donald Trump’s childish Twitter commentary gave the comedians on duty plenty to mock. “The Late Show” host Stephen Colbert joked how the first debate between Sen. Elizabeth Warren (Mass), Sen. Cory Booker (N.J.) and O’Rourke against “several people angling for MSNBC shows” was actually “an excellent dress rehearsal for tomorrow’s actual debate” involving the front-runners, former Vice President Joe Biden and Sen. Bernie Sanders (I-Vt.). Check out the segment here: “The Late Show” also unveiled this spoof “Primarymon” card game: “The Daily Show” host Trevor Noah dedicated more than 11 minutes to dissecting the most amusing incidents: The Comedy Central program also live-tweeted throughout: Love HuffPost? Become a founding member of HuffPost Plus today. Warren arrives at the #DemDebate with all her policies in tow pic.twitter.com/4rc5SNl8dE — The Daily Show (@TheDailyShow) June 27, 2019 Team de Blasio signing on! #DemDebate https://t.co/FZsZBVFEJx pic.twitter.com/Rdp1VG1I5I — The Daily Show (@TheDailyShow) June 27, 2019 Achievement Unlocked: ¡Tiempo de pander! #DemDebate pic.twitter.com/2D5u5aerPJ — The Daily Show (@TheDailyShow) June 27, 2019 When Dad says "Hola, como estas?" to the waiter at the Mexican restaurant #DemDebate pic.twitter.com/64FY2LV6kp — The Daily Show (@TheDailyShow) June 27, 2019 Not your type? https://t.co/3smAE1oRk7 — The Daily Show (@TheDailyShow) June 27, 2019 No one: Every Democrat: ¡Hola, muchachos! ¿Vamos a la playa? Ja ja ja ja ja #DemDebate — The Daily Show (@TheDailyShow) June 27, 2019 When your little sister steals your phone https://t.co/2vucJQxpOM — The Daily Show (@TheDailyShow) June 27, 2019 BREAKING: Jay Inslee, John Delaney, and Tim Ryan have spontaneously fused into a jar of mayonnaise #DemDebate pic.twitter.com/zq2oSwFrdg — The Daily Show (@TheDailyShow) June 27, 2019 EXCLUSIVE: Behind-the-scenes footage of MSNBC's technical difficulties #DemDebate pic.twitter.com/45jmBKmNIK — The Daily Show (@TheDailyShow) June 27, 2019 When you remember we have to do this all over again tomorrow #DemDebate pic.twitter.com/SRvkN61qps — The Daily Show (@TheDailyShow) June 27, 2019 “The Tonight Show” host Jimmy Fallon got musical to sum up the crowded Democratic field: Story continues He also sang this song warning the candidates not to become a meme: Seth Meyers of “Late Night” riffed on the crowded field in his monologue: He took a more in-depth look in the “A Closer Look” segment: Related... Trevor Noah Nails Why Donald Trump's 'Not My Type' Rape Denial Is So Vile Shep Smith Delivers Scathing Fact-Check Of Donald Trump’s Migrant Children Claim Kids Magazine Issues Blistering Takedown Of Trump Migrant Children Policies Also on HuffPost This article originally appeared on HuffPost . View comments |
Billionaire's Paris Startup Hub Growth Shows Ecosystem Progress
(Bloomberg) -- Billionaire Xavier Niel’s 250 million-euro ($285 million) bet that mega-campus Station F would help Paris become a global tech startup hub may be starting to pay off.
Entrepreneurs working out of Niel’s institution have collectively raised more than 567 million euros since the June 2017 inauguration, more than half of which arrived over the last financial year, Station F Director Roxanne Varza said in an interview. And in a move similar to WeWork’s expansion into communal residences, Station F is now adding housing for members, with three buildings opening to host 600 entrepreneurs with competitive rental prices.
"France’s image is changing and starting to be perceived as more business-friendly,” Varza said, adding that 41% of the 1,000-plus startups on campus have now tapped investors.
Built on the site of an old train station and financed by Niel’s own money, the 34,000-square-meter venue has expanded from desks for rent to host venture capitalists and corporate-backed programs for entrepreneurs, from Facebook Inc.’s data-focused “startup garage” to an artificial intelligence program by Microsoft Corp.
Station F’s growth comes as co-working giant WeWork Cos. snaps up real estate at a rapid clip in Paris (it has eight sites in the French capital, with seven more listed as opening soon according to its website), and has already started offering communal residencies and even a private elementary school arm in the U.S.
Putting the French capital on par with Silicon Valley for technology investment and innovation is ultimately Niel’s goal. While that’s still far off, the French investor and telecom tycoon has managed to attract some U.S. talent to Station F. American entrepreneurs are the second biggest group, after French people, and make up about 7% of people at the Paris campus.
France’s startup ecosystem also attracted record levels of VC funding during the first three months of 2019, with nearly $1 billion raised during the quarter, according to data compiled by KPMG.
“The ecosystem is still in takeoff stage -- I think it can grow into something much bigger still,” Varza said. “It’s already getting a lot of interest from international investors though, and Paris is being compared more and more to Silicon Valley.”
While France still needs to demonstrate its ability to churn out world-dominating technology companies, it’s extending its list of homegrown unicorns, with recent additions including photoshoot platform Meero Ltd. and doctor-appointment booking app Doctolib.
Recent rounds by companies with a Station F footing include cybersecurity provider Alsid’s 13 million-euro raise in April, and e-sports contender group Team Vitality’s 20 million euros in November.
To contact the reporter on this story: Marie Mawad in Paris at mmawad1@bloomberg.net
To contact the editors responsible for this story: Giles Turner at gturner35@bloomberg.net, Nate Lanxon
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Chipotle Tries a New Answer to Its Worker Churn Problem: Team Bonuses
Thelow unemploymentconditions prevailing in the U.S. today have given workers at the bottom of the wage scale some extra leverage. If you don't like your job in fast food or retail -- or indeed, any entry-level position -- you won't find it too hard to go down the street and land a new one -- possible at a higher hourly rate.
That's a problem forChipotle(NYSE: CMG), which has a promote-from-within culture: Traditionally,95% of its managershave started out as store crew members and moved up through the ranks. If employees don't stick around, however, they miss out on those opportunities to move from entry-level slots making below $30,000 a year to positions that can pay over $100,000.
To reduce staff churn, the fast-casual Mexican chain has decided to give employees an additional incentive to stay: It's offering bonuses to its hourly workers that could equal an extra month's salary over the course of a year.
Chipotle is offering bonuses to its workers if they stay with the company and their stores meet their goals. Image source: Chipotle.
The restaurant chain, which has over 70,000 employees and about 2,500 locations, will award bonuses at the end of each quarter to employees whose stores meet their sales goals,Nation's Restaurant News(NRN) reported. Ideally, these bonuses -- a week's worth of pay, as calculated for each individual -- will help the chain reduce its 145% annual turnover rate. To qualify, workers will have to be employed at the chain for the full quarter.
"They are rewarding their staff for building their business while being guest-facing brand champions, which is typically only given to management," restaurant consultant Jenny Companion toldNRN.
This type of bonus gives workers a reason not to job hop for slight increases in pay -- assuming the bonus targets are reasonably attainable. And leaving in the latter part of a quarter will be less appealing to workers who know that would mean sacrificing money they've already more or less earned.
Most importantly, this program should boost crew members' sense of responsibility to the team, and by extension, their restaurant. By creating a group incentive to deliver the best possible service -- and to encourage your coworkers to do the same -- these bonuses should lead to increased customer satisfaction.
Retaining workers for longer periods helps any company operate more efficiently. For Chipotle crew members, that can reflect something as fundamental as developing the muscle memory for hand-building a burrito or working a cash register. And skilled line workers later become managers who truly understand all the details of their restaurants' daily operations, which makes the company stronger.
In this low unemployment economy, though, offering the lure of bonuses may not be enough to significantly boost worker retention. Chipotle -- which has stressed to the Motley Fool in emails that it offers benefits well beyond its hourly wages -- should consider increasing its minimum hourly wage to the $15 standard.
That rate has not yet been commonly adopted, but some larger companies have already gotten there or pledged to reach it within the next few years. It's possible that $15 an hour will soon become the floor for any company that hopes to attract the highest-quality entry-level and hourly workers -- people whom businesses can train up and develop into their next generations of management.
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Taiwan halts US$32.2 million investment by Hong Kong firm with 'extreme deep connections' to Beijing on security grounds
The largest property development project in Taipei has been halted, after Taiwan's ministry of economic affairs blocked a key investor citing national security concerns.
Hong Kong-listed Nan Hai Corporation had bid through a wholly-owned subsidiary, Nan Hai Development, along with Malaysian property developer Malton Berhad to develop a property connecting metro stations, office buildings and shopping malls near the Taipei railway station.
In a statement on Wednesday, the ministry said a deal review committee had found Nan Hai "has extreme deep connections" with mainland China and that it "could be easily influenced by mainland policies". It has stopped the consortium led by Nan Hai Development from depositing NT$1 billion (US$32.2 million) as down payment for the project.
The project, first announced in 2006, had failed to attract eligible bidders in five previous attempts because of the huge investment commitment it requires " NT$60 billion. The total cost of Taipei's landmark 101 tower, for instance, was NT$58 billion.
The ministry said Bermuda-based Nan Hai was controlled by Chinese citizens and could be easily influenced by Beijing. Yu Pun Hoi, 61, the company's chairman, is a media mogul. Publicly available information shows he founded print and online media company HK01 in 2016. Before that, he acquired US-based political news website DuoWei News in 2009 and the Hong Kong-based tabloidMing Paoin 1990.
Yu, who controls Nan Hai with a 59.25 per cent stake through Dadi Holdings Limited, also holds research titles at prestigious mainland Chinese universities Peking University and Tsinghua University.
TheTaipei Timesreported on December 28 last year that the consortium had won the project and its bid was favoured by authorities in Taipei. The report also said Nan Hai was to invest NT$60 billion in the project.
In a filing with the Hong Kong stock exchange in December, Nan Hai said it and its subsidiary had been deemed eligible by Taipei's city government to proceed with the bidding process.
Yu Pun Hoi, the chairman of Bermuda-based Nan Hai Corporation. Photo: Alamy Live News alt=Yu Pun Hoi, the chairman of Bermuda-based Nan Hai Corporation. Photo: Alamy Live News
Rating agency Moody's has rated Nan Hai as "B1". In a review last month, analysts said the company had "diversified business operations, including a profitable property development business and cinema operations". They also noted constraints on its credit profile due to moderate debt leverage, caused by a fast expansion in business.
On Thursday, Taiwanese mediaLiberty Timesquoted authorities as saying they might scrutinise other investments made by Nan Hai in Taiwan and abort investment approvals if they found any national security concerns. The company has stakes in Taiwan-based Sunny Bank and Taiwan Dadi Cinema.
The company did not respond to a request for comment.
This article originally appeared in theSouth China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore theSCMP appor visit the SCMP'sFacebookandTwitterpages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved. |
Inside China's battle to keep internet addiction in check
Li Jiazhuo, 14, was bundled away one afternoon in May by two burly men who identified themselves as Education Bureau officers there to investigate his truancy from school.
Except they were not from the Education Bureau but were orderlies from an internet detox centre run by an ex-Army colonel.
They had gone to drag the teenager away from his computer at the behest of his mother, who had watched her son skip meals and forgo sleep to play online games for 20 hours a day for weeks.
His favourite titles wereLeague of LegendsandHonor of Kings, both owned by Tencent Holdings, the Chinese internet giant that is also behind the WeChat social messaging app.
"He had cut himself off from the real world," said Li's mother, Qiu Cuo, who cried while recounting the events of that afternoon. "We dared not block his access to the internet for fear he would harm himself. It was the end of my world."
Li is one of about 100 mostly teenage boys and girls at the Adolescent Psychological Development Base, a drab collection of buildings located about 30 kilometres (19 miles) from central Beijing.
They are checked in, most of them against their will, by parents and guardians to undergo treatment for addiction to the internet, which was classified in China as a mental disorder in 2008.
Internet addiction has received fresh scrutiny after the World Health Organisation added gaming disorder to its international classification of diseases last year, 10 years after China first classified it as a public health threat.
China has stepped up its oversight of its video gaming industry following a directive by Chinese President Xi Jinping last August to the government to prevent widespread myopia among children.
In the past year, Tencent, the market leader, has introduced age verification and limits on play time by young people. The Shenzhen-based company had no comment for this story.
In marked contrast, video game industry associations from the US, Canada, Australia, New Zealand, South Korea, South Africa and Brazil have resisted the WHO classification, calling on it to rethink the decision, which they charge "is not based on sufficiently robust evidence".
Under the WHO definition, gaming disorder is a pattern of behaviour characterised by impaired control over gaming, increasing priority given to gaming over other activities to the extent that it takes precedence over other interests and daily activities, and the continuation or escalation of the pattern despite negative consequences.
For a diagnosis to be made, the behaviour pattern must be sufficiently severe to affect important areas of functioning for at least 12 months.
Any decision to curb video gaming pits public health interests against the commercial interests of a lucrative industry.
In China, home to the world's biggest internet population with more than 800 million users, the video gaming industry is estimated to be worth US$30 billion a year in revenue.
At the same time, playing video games is an increasingly popular pastime that is challenging other modes of entertainment for the attention and wallets of consumers.
ThePostvisited the treatment centre in Beijing earlier this month.
Rooms at the Adolescent Psychological Development Base are spartan. Photo: Lea Li alt=Rooms at the Adolescent Psychological Development Base are spartan. Photo: Lea Li
Run by Tao Ran, a former People's Liberation Army colonel who headed army psychology units, the centre is one of the earliest places in China to diagnose and treat internet addiction and is said to have developed treatment protocols that are used in other parts of the country.
The facility consists of several buildings that serve as canteens, dormitories and treatment rooms, arranged around an internal open-air courtyard that doubles up as a basketball court and where patients assemble for exercise. No electronic devices are allowed.
Internet addiction is "such a big problem in China" and worsening with the popularity of smartphones, said Tao, who estimates that 10 per cent of China's teenagers are obsessed with the internet.
"It's no longer a problem for just teenagers. We have nine-year-old kids as well as 30-year-old adults. We're also seeing more girls and children from rural areas."
Some are so hooked that they would wear adult diapers to avoid having to go to the toilet and interrupting their games, according to Tao.
One stole 30,000 yuan (US$4,345) from his parents, went into an internet gaming cafe in autumn and emerged the following spring.
Most try to escape and are "very defiant and arrogant" at the beginning, Tao said. "But results are apparent after months of treatment."
Over the years, news reports of abuse at these detox treatment centres, including the use of controversial electroshock therapy, have prompted the government to increase its oversight of the industry.
Director Tao Ran is a former Chinese army colonel who has run the treatment centre, south of Beijing, for nearly 20 years. Photo: Lea Li alt=Director Tao Ran is a former Chinese army colonel who has run the treatment centre, south of Beijing, for nearly 20 years. Photo: Lea Li
Tao said that electroshock therapy and corporal punishment are not used at his centre, which charges about 10,000 yuan a month per patient and was set up in 2003.
Treatment consists of a combination of drug therapy, psychological counselling, physical exercise and family activities, and typically lasts at least three months.
Parents and guardians are required to stay at the centre, where they live in separate dormitories from their children and undergo lectures, such as those teaching them how to communicate with their children.
A typical day at the centre starts at 5am, where the patients are roused from sleep and gather for the first of several boot camp-style exercise periods at 6am.
After breakfast at 7.10am, it's time for counselling sessions, more exercise and "other activities", according to a schedule provided. The lights are switched off at 9.30pm. Weekends are devoted to cleaning, laundry, more exercise and a recap of the past week.
When we visited the centre at around 9.30am, the children were doing runs, push-ups and squats to barked commands from instructors wearing army fatigues. Many of them looked lethargic and reluctant.
Those who rebel are tied to their beds with restraints until they calm down, while more serious cases are kept alone in a small room for as long as 10 days, according to an account from one patient.
The Adolescent Psychological Development Base offers a range of treatments " physical, emotional and sometimes medical. Young addicts also learn military songs. Photo: Lea Li alt=The Adolescent Psychological Development Base offers a range of treatments " physical, emotional and sometimes medical. Young addicts also learn military songs. Photo: Lea Li
The centre confirmed the use of solitary confinement for "reflection, just like in the army", but denied the use of restraints.
The dormitories are spartan and functional, with three double-decker bunk beds with thin mattresses and straw mats in each room. Personal belongings are kept in blue plastic containers with names written on them and shoes are arranged neatly in line.
For many of the children in the centre, it would be the first time that they are doing household chores and making their own beds.
Zhao Xiaojia, 15, remembers the day he was brought to the centre against his will.
"I shouted on the first day, I did not know where this place is and did not want to stay here," he said. "I was not allowed to meet my parents, I clashed with the guards and was tied to a metal bed frame for half a day."
Zhao had spent most of his waking hours on the internet for two months before his parents said enough was enough. He was on a QQ internet chat for three consecutive days and refused to take off his earphones even while asleep.
He goes for group therapy in the morning, where dozens of teenagers like him sit in a circle and discuss different topics with a psychiatrist, such as why they are depressed.
Then there are individual counselling sessions, activities with family as well as boot camp-style physical training.
Security in the treatment centre resembles that of a prison. Gates and windows are locked and barbed wire is fixed atop the high walls. Photo: Lea Li alt=Security in the treatment centre resembles that of a prison. Gates and windows are locked and barbed wire is fixed atop the high walls. Photo: Lea Li
Lunch at the centre is usually three dishes, rice and soup. "Noodles on Tuesday evening," Zhao said. He has been at the centre for 280 days.
Wang Guoqiang, a factory worker from Hebei province, has stayed at the centre with his son for a year and has spent more than 150,000 yuan on treatment. It is a huge financial burden but worth it, he said.
"We are spending money to save the life of my kid," he said. "He felt an emptiness in his heart and looked for fun in games."
Just as his son undergoes counselling, Wang also takes classes to learn "how to be a good father".
"I believe my son will adapt himself to society after getting out," he said.
This article originally appeared in theSouth China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore theSCMP appor visit the SCMP'sFacebookandTwitterpages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved. |
Is Donald Trump's threat to quit Japan defence pact just a negotiating tactic?
Security analysts have dismissedsuggestions that Donald Trump would pull out of the defence treaty with Japan, saying it was likely to be a negotiating tactic aimed at extorting greater trade concessions from Tokyo.
They also warned that if Japan was freed from the restrictions imposed by the post-World War II alliance, it would build up its military " possibly acquiring nuclear weapons " which would unsettle China and trigger an "unrestricted" arms race in the region.
The US president is expected to arrive in Osaka on Thursday ahead of the G20 summit, where he is expected to meet his Chinese counterpart Xi Jinping on Saturday for much-anticipated trade talks.
However, Trump will also want similar talks with Japan as he pushes for a deal aimed at resolving a trade deficit that the United States says has reached US$67.6 billion.
Japan's armed forces are solely intended to be used for self defence under the terms of the country's post-war constitution. Photo: Kyodo alt=Japan's armed forces are solely intended to be used for self defence under the terms of the country's post-war constitution. Photo: Kyodo
On his last visit to Japan in May heagreed to suspend an increase in tariffs on Japanese cars for six months, and predicted the two sides would reach a deal "probably by August".
"Trump will not pull out of the defence treaty which has played an essential role in the United States' global strategy," said Song Zhongping, a Hong Kong-based military analyst. "Trump just wants to push for more trade concessions from Japan."
Song said that Trump also wanted Japan to increase its contribution towards the costs of stationing American troops in the country by half.
About 54,000 American troops are stationed in the country across 85 facilities, according to the US Congressional Research Service.
On Tuesday Bloomberg cited three unnamed sources as saying that Trump had privately discussed ending the pact " a claim the Japanese and White House both denied.
But Song also argued: "It's Japan that wants to abolish the defence treaty more and it's the US that has restricted Japan's ability to develop its own military capabilities."
"If the US did withdraw from the treaty, Japan would have no limits on its military build-up," Song added. "That would pose a real threat to China."
During his visit last month, Trump confirmed that Japan had been given the go-ahead to buy 105 US-made F-35 Lightning jets, which would give it the largest F-35 fleet of any US ally.
Japanese Prime Minister Shinzo Abe has previously suggested that Japan's constitution, brought in after its defeat in World War II, should be revised to remove a clause limiting its armed forces to a purely defensive role.
US President Donald Trump has been pushing Japanese Prime Minister Shinzo Abe for a new trade deal. Photo: AP alt=US President Donald Trump has been pushing Japanese Prime Minister Shinzo Abe for a new trade deal. Photo: AP
Collin Koh, a military specialist at the S. Rajaratnam School of International Studies at Nanyang Technological University in Singapore, also expressed doubts that the US would pull out of the alliance, saying such a move risked undermining America's military presence in the region.
He warned that such a step could not only see troops being withdrawn from Japan but also the protection of the US nuclear deterrent.
"[That] could lead to Japan rethinking rearmament, and possibly interest it in acquiring nuclear weapons," Koh said.
"That could set off a potential chain reaction in the region, such as South Korea acquiring its own nuclear arms, North Korea and China bulking up their existing arsenals, and Taiwan possibly joining the fray.
"It will have the end effect of destabilising the region ... I believe China might be more unsettled by such a prospect."
This article originally appeared in theSouth China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore theSCMP appor visit the SCMP'sFacebookandTwitterpages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved. |
China Construction Bank and China Merchants Bank ace stress test conducted by DBS Bank
China Construction Bank and China Merchants Bank are seen as the two most resilient mainlands banks capable of withstanding an extreme economic downturn because of their strong capital base, according to a stress test conducted by DBS Bank.
Only two other banks " Chongqing Rural Commercial Bank and Bank of Shanghai " passed the Singaporean bank's stress test involving a total of 19 lenders, which represent 76 per cent of the assets in China's banking industry.
China's banking industry will need to raise 2 trillion yuan (US$291 billion) to replenish their capital in the event of three bear scenarios, Ken Shih, a banking and insurance analyst with DBS told a press conference on Wednesday in Hong Kong to announce the results of the study.
Specifically, the scenarios suppose a big drop in annual economic growth to 4 per cent (from more than 6 per cent currently) in 2020, to be accompanied by the bursting of a residential credit bubble that could trigger a 31 per cent plunge in property prices, and non-performing loans rate for private firms spiking by 5 percentage points from the current level to 10 per cent.
China Merchants Bank was one of the three Chinese banks held in contempt by a US court for refusing to comply with subpoenas in an investigation into North Korean sanctions violations. Photo: Reuters alt=China Merchants Bank was one of the three Chinese banks held in contempt by a US court for refusing to comply with subpoenas in an investigation into North Korean sanctions violations. Photo: Reuters
DBS conducted the study, zeroing in on these 19 banks, after gathering feedback from clients on investing in Chinese banking stocks.
On the prospects of the banks' share prices involved in the stress tests, Shih said that he "likes China Construction and China Merchants for their low exposure to risky segments and sufficient capital level to cover credit risks".
He added Bank of Shanghai could benefit from its shift in focus to retail banking and strength in fee-based income, while Chongqing Rural's outlook depends on the smooth listing of its A shares due later this year.
Chinese banks have been in the media spotlight this week for working with a Hong Kong front company accused of laundering more than US$100 million for North Korea.
On Tuesday, theWashington Postreported that a US district judge had found three Chinese banks for refusing to comply with subpoenas in an investigation into North Korean sanctions violations. Although the report did not identify the banks, but details in the court ruling align with a 2017 civil forfeiture action against Bank of Communications (Bocom), China Merchants Bank and Shanghai Pudong Development Bank (SPDB), with the possibility that SPDBcould be cut off from the US financial markets.
"We still think the chance is quite slim for the US to pass a final ruling to sanction the banks. But this is actually a political risk rather than a credit risk, thus difficult for us to calculate," Shih said.
US assets account for 5 per cent of China Merchants' and Shanghai Pudong's total assets, while Bocom's exposure stands at 10 per cent.
Most of their US assets are in the form of US dollar loans and trade finance, he said, adding that Shanghai Pudong's credit profile was relatively weaker.
On Wednesday the share prices of China Merchants, Bocom and Shanghai Pudong recovered from Tuesday's plunge after the three banks issued separate statementsdismissing allegations they were in breach of sanctions against North Korea. They said having been following the UN sanctions resolution, and were operating in accordance with international and Chinese laws.
Their shares continued rising on Thursday, with China Merchants and Bocom up 2.3 per cent and 0.5 per cent, respectively in Hong Kong. Shanghai Pudong's A shares rose 0.7 per cent in Shanghai.
The banks' statements were supported by the China Banking Association, a semi-official organisation that operates under the auspices of the China Banking and Insurance Regulatory Commission.
Bu Xiangrui, the association's chief legal counsel, said that Chinese banks should not follow the directives of the US court because the latter had not sought permission from the Chinese authorities to collect information.
"They essentially force companies or individuals in other countries to follow the US law, which violates the judicial sovereignty of other countries and does not conform to the spirit of international law," Bu said.
This article originally appeared in theSouth China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore theSCMP appor visit the SCMP'sFacebookandTwitterpages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved. |
The US is picking a fight with Canada over a thawing Arctic shipping route
The Northwest Passage is one of just two possible shipping routes through the Arctic. “Possible” is generous: The icy landscape is treacherous for all but the burliest ships. Because the passage is of limited use, countries have rarely clashed over its ownership. But the climate crisis may change all that. As its ice thins and winters warm, the Northwest Passage will become a major shortcut for commercial shipping, particularly to and from Asia. The newly-valuable route is bound to incite tension between nations—and a recent meeting of Arctic countries suggests it already has. Jeffrey Epstein’s fortune is built on fraud, a former mentor says Canada has long maintained a territorial claim to the Northwest passage. In May, at a meeting of the Arctic Council, United States secretary of state Mike Pompeo called that claim “illegitimate,” invoking a dispute that’s been left well alone for nearly three decades. The swipe was unexpected, but not without motive: Pompeo referred to the Arctic’s melting sea ice as opening “ new opportunities for trade .” Since 1988, the United States and Canada—Arctic neighbors and partners in NATO and NORAD—have operated under the comfortable compromise of the Arctic Cooperation Agreement. Canada has always taken the view that the waters of the Northwest Passage are internal, because they say they’re within the waters of the nearly 20,000 islands of the Canadian archipelago. Their claim is supported by thousands of years of Inuit use of the sea ice. “The Northwest Passage is part of Inuit Nunangat, our Arctic homeland,” Monica Ell-Kanayuk, the president of Inuit Circumpolar Council Canada, said in a news release . Sea ice bridges the land and the islands of the archipelago for most of the year. The US, on the other hand, regards the waters as an “international strait,” where the freedom to navigate through them is guaranteed to anyone. “We view Canada’s claim that the waters of the Northwest Passage are internal waters of Canada as inconsistent with international law,” a State Department spokesperson wrote in an email to Quartz. Story continues Hong Kong’s protesters put AirDrop to ingenious use to breach China’s Firewall Under the 1988 treaty, the US doesn’t officially recognize the Northwest Passage as Canada’s, but it agrees to ask for permission to pass through it. Canada, in turn, agrees in advance to always grant permission. When it comes to the Arctic, “the US-Canada situation has been perfectly cooperative since then,” says Michael Byers, a research chair at the University of British Columbia and an expert on Arctic politics. Canada’s coast guard even runs a yearly resupply mission for the Thule US Air Force base in Greenland. But climate change upsets the balance. The 1988 treaty only concerns US Coast Guard icebreakers, because they were once the only vessels that could traverse the harsh 1,000 nautical miles of the passage. Today, non-governmental vessels are starting to show up in the Northwest Passage. “Were it not for climate change, that agreement would still be sufficient,” Byers says. “Climate change is now opening the possibility of other types of vessels, including from other countries.” Those ships may soon include US naval vessels. Earlier this year, US Navy secretary Richard Spencer said the Navy plans to send vessels through the Arctic, and specifically through the Northwest Passage. “Freedom of navigation should be plied up there,” he said. If the US chooses not to request permission to pass, that would mark a clear provocation. It could also be dangerous, according to Rebecca Pincus, an assistant professor in the Strategic and Operational Research Department at the US Naval War College. In January 2019, she wrote in the journal of the Naval Institute that trying to send naval vessels through either major Arctic shipping passage (the other passage, known as the Northern Sea Route, is claimed by Russia) would risk a “national embarrassment.” Severe weather can come on suddenly, maritime maps are low on detail, and ports of refuge are far away. If a naval vessel found itself in need of a bailout, the US Coast Guard only has two icebreakers up to the task—neither of which is fully reliable. The US vessels could be forced to seek rescue from Canada or Russia. Ships aren’t yet flooding the passage; their numbers have just risen from virtually zero to a few ships here and there. So far they’ve all been complying with Canadian law, and asking for permission to pass, according to Byers. And right now, the US is all in favor: The US encourages all US-flagged vessels to cooperate with the Canadian Coast Guard. But the US State Department spokesperson added that the US also doesn’t see “eye to eye” with Canada’s regulation around shipping in Arctic waters, “which we believe are inconsistent with the Law of the Sea.” As shipping ramps up, tensions will only increase. At the same meeting of the Arctic Council in May, typically reserved for peaceful collaboration, Pompeo warned Russia and China that the US wouldn’t tolerate any “aggressive” moves from either of them. As Byers explains, though, reopening the dispute with Canada could complicate relations with those countries. “You don’t want to push the dispute with Canada, because it would open it up to unrestricted passage by China and Russia,” Byers says. “You can’t help but wonder if someone is stuck in the ’80s. Why would you aggravate a dispute with Canada and with Russia and China?” The climate crisis may have precipitated the debate over Arctic waters, but rhetoric from the United States risks tipping it over the edge. Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: Tip your delivery worker in cash, not via an app A “Go Back to Africa” media campaign uses AI to boost African American tourism |
Before we knew better: “Bill Nye the Science Guy”’s legacy endures 26 years later
An image of Bill Nye sitting at a desk with a globe from the 90s. In this mini-series, we return to movies and TV we’ve loved to see how they depict gender. Does it hold up in 2019? Warning: contains spoilers. When was this show released? 1993 The Ethiopian Airlines 737 Max crash could warrant historic punitive damages against Boeing How does it hold up? Very well. In the US, Bill Nye inspired an entire generation of scientists and science enthusiasts—including me. Nye’s show, which was a product of Disney and the National Science Foundation, ran for four seasons over five years. Each episode followed the same structure: one scientific topic, covered dozens of ways, over the span of 30 minutes (about 22 without commercials). White supremacists and anti-fascists head to DC ahead of Trump’s July 4 celebration Each episode was built to feel like flipping through the channels on your television. Viewers could catch a commercial (which never sold anything), a 1950s-style sitcom, and even a music video featuring a parody of a popular song—all tied to the week’s theme. Nye bounced around the fictitious “Nye Laboratories,” using models and props to explain scientific concepts, emphasizing key words with cheesy animations and sound effects. Growing up, I idolized Nye. I still have a picture from when I met him at an aquarium: I was seven, and he was signing a book on ocean exploration. I learned the chorus to Science Guy ‘s “Whatta Brain” parody before I ever heard the original Salt-N-Pepa “Whatta Man.” It wasn’t just me that got hooked. The show was nominated for 23 Emmy awards, and won 19 of them . And from an educational standpoint, it worked. Across elementary and middle schools in the US (my own included), the show often took the place of science lessons on days when the teachers were off—something Nye joked about at an annual meeting of the National Science Teachers Association in the 2017 documentary Bill Nye: Science Guy. But Bill Nye ’s legacy isn’t about education. The real reason it was such a great show? It showed viewers that science is for everyone, and can be done by anyone—regardless of their age, gender, race, or ability. Story continues Nye’s wide-eyed enthusiasm showed viewers it was okay to get excited about science. Who else could get kids into niche disciplines like podiatry—as he did when he featured a sneaker-making foot doctor on an episode about muscles and bones. Nye and the show’s two other co-creators, Jim McKenna and Erren Gottlieb, also made it easy for kids to see themselves in the scientists on screen. There’s no official count, but several members of Nye’s team of kid scientists were girls, and many were people of color. They each had their own lab coat, demonstrated experiments to try at home, and explained concepts just like their host. Nye made a point of showcasing the work and proficiency of each of his guests. He was the Mister Rogers of science, making the laboratory his neighborhood. Earlier this month, I had a chance to sit down with Nye at the National Press Club in Washington, DC. For the sixteenth year in a row, he was there celebrating the winners of ExploraVision , a massive science fair featuring kids from kindergarten through twelfth grade in the US and Canada. I asked him how he and his co-creators had been so far ahead of their time, featuring a diverse group of science enthusiasts well before today’s public campaigns to encourage diversity in STEM. “I was born a white guy in the US. English is my first language. What else do you freaking want?” he asked rhetorically, agitated. Growing up in DC, he said, it was clear that people who didn’t look like him—being either people of color or women or from poorer households—had to work harder than he did for the same opportunities, or had to grow up faster than he did. “It gets back to this notion that every little kid complains about, which is life is not fair. I don’t think anybody would argue that it is,” he said. “But wouldn’t it be better if it was?” At the time we spoke, Nye was still riding a wave of attention following the release of his new show on Netflix, Bill Nye Saves the World . After three seasons, Netflix hadn’t asked for another—although Nye was hopeful that maybe his new podcast Science Rules, would revive interest. The rebooted show was clearly targeted at people like me who grew up on Nye. As adults, we could talk about scientific issues with grown-up themes and darker realities, like the looming threat of climate change. I didn’t like that it was riddled with pop culture references and weak nods to back to the old show. But it did inspire me to rewatch any old Science Guy episodes I could find online. At the time, Netflix had the first two seasons—but not the latter three, which aired from 1995 to 1998. Some of them are still available on YouTube through fan accounts. Rewatching episodes of Bill Nye the Science Guy made me appreciate all the smart choices I didn’t catch as a kid. In a segment about HIV, Nye explained that there was a virus that attacked the body’s immune system, but that it wasn’t possible to transmit through touching or kissing. It was a reason, he said, to take care of our immune systems, and work to find a cure. The segment following showed a bunch of kids, some of whom had HIV, playing on a boardwalk—one of my favorite activities growing up. Nye elided the early-90s stigma attached to the sexually transmitted infection, so my 7-year-old self never latched on to it. The point of Science Guy , Nye said to me that day in DC, was to try to make the world a little more fair, and to show everyone—particularly elementary school kids—that they were capable of making the world a better place. Today, the show’s message is still relevant. We’re still in dire need of young scientists, Nye says , to bring us new ways to combat climate change and engineer medical breakthroughs. Luckily, he inspired an entirely new generation of scientists who can take up his role. Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: Five reasons English speakers struggle to learn other languages Ten days of utter silence pulled me back from the brink of a mental breakdown |
Trump peace plan conference is blip on Israel's radar as political, Iran crises swirl
By Dan Williams JERUSALEM (Reuters) - A U.S.-led conference in Bahrain designed to drum up investment in the Palestinian economy and pave a path to peace with Israel has gone largely unremarked by Israelis preoccupied with a political crisis and their arch-foe Iran. Palestinians, who view the Trump administration as biased toward Israel, boycotted this week's meeting in Manama. {nL8N23X20I} It was also held without an official Israeli delegation. Organizers said privately this was due to worry about a further dent to the event's credibility after an April election in Israel failed to produce a new coalition government. With Prime Minister Benjamin Netanyahu facing proliferating challengers in a new election due in September and beset by corruption scandals, the hazier-than-ever peacemaking horizon with the Palestinians drew scant discussion in Israeli media. Netanyahu said on Thursday that the Palestinian leadership chose ideology over the benefit of its own people. The conflict "requires a political solution. But you shouldn't boycott this important summit in Bahrain just because that's difficult or has to be carried out in stages," Netanyahu said at a conference in Jerusalem. "The economic basis is important for coexistence and eventually for peace." Economy Minister Eli Cohen went as far as to suggest that Bahrain may have closed the door on further diplomacy. "We saw that, even in an economic conference where the Palestinians were meant to come and get money, to come and get tools and inducements, to come and develop their economy, they did not come," he told Israel's Reshet 13 TV. "We see, really, that they do not want a peace accord. They simply don't want us here. ... Again, the Palestinians' true face has been exposed." The Palestinians, who have shunned the United States since it recognized disputed Jerusalem as Israel's capital in late 2017, suspected the conference sought to lure them into surrendering their statehood goal in return for global financial relief. Story continues It is not clear whether a peace plan promised by the Trump administration will call for a "two-state solution" sought by the Palestinian Authority and backed internationally, which involves the creation of a Palestinian state alongside Israel. Netanyahu voiced conditional acceptance in 2009 of a future demilitarized Palestinian state. He has since said its creation would not happen on his watch and that he plans to annex some Jewish settlements in the occupied West Bank, communities many countries view as illegal. Stalled since 2014, peacemaking has been on a backburner for some Israelis, while others feel a need to work for coexistence. "This is a matter that's important to me. We need an end to this situation," said Jerusalem chef Israel Bachar, 45. "It's a little odd that the Americans held this conference without convening the two main parties involved. I don't think it's helpful to try to impose things from outside." Netanyahu described the Bahrain gathering as part of a U.S. effort "to bring about a better future and solve the region's problems". Two days before it opened, he toured the strategic Jordan Valley, the eastern-most part of the West Bank that borders Jordan, with U.S national security adviser John Bolton and said Israel must retain a presence there in any peace deal. Israeli journalists were at Bahrain, a rarity for a Gulf state that does not formally recognize Israel. The resulting coverage focused as much on wider Israeli-Arab contacts and Bahrain's tiny Jewish community as on the Palestinian no-shows. Cohen, a member of Netanyahu's security cabinet, said Arab delegates saw Bahrain as a chance to close ranks with Israel on bilateral commerce and in the face of a common adversary. "This was, in fact, a regional summit against Iran," he said. "We see here a coalition in the Middle East...They (Arab powers) understand that their security threat is Iran." Washington and Tehran have exchanged threats and heated rhetoric in recent weeks, with the United States increasing sanctions on Iran and Iranian forces shooting down a U.S. drone in the Gulf. The Institute for National Security Studies at Tel Aviv University gave a cautious welcome to the initiatives announced in Manama, including a global investment fund for the Palestinians. But it said these could not trump statecraft. "While a willingness to earmark huge investments in economy, infrastructure, education, health, and welfare in the West Bank and Gaza Strip should be good news...what is also required is a political plan that is both creative and beneficial to the Palestinians," INSS scholars Tomer Fadlon and Sason Hadad wrote. Israel captured the West Bank and Gaza in the 1967 Middle East war. It pulled its troops and settlers out of Gaza in 2005; Hamas Islamists, who have called for Israel's destruction, now rule the enclave. Palestinians seek both territories for a future state. (Writing by Dan Williams; Editing by Jeffrey Heller, Angus MacSwan and Leslie Adler) |
Antitrust regulators may also scrutinize internet firms' cryptocurrencies: German cartel chief
BONN, Germany (Reuters) - Cryptocurrencies backed by big internet companies could come under the scrutiny of antitrust regulators, the head of Germany's Federal Cartel Office said on Thursday after Facebook last week launched its own version. Central bankers and financial watchdogs were quick to raise concerns about Facebook's planned Libra global cryptocurrency, saying that it could become so pervasive as to disrupt the global monetary policy framework. Germany's antitrust watchdog's president Andreas Mundt, who has pursued the world's largest social network over other areas of its business, told reporters that cryptocurrencies launched by companies like Facebook "could become a topic for us". Mundt has taken Facebook to task over its handling of data collected from users of the social network and its messaging apps without their consent, finding the firm founded by CEO Mark Zuckerberg abused its market dominance. In its ruling in February, the Federal Cartel Office ordered Facebook to curb its data collection practices. The company appealed that decision, which is now before the German courts. (Reporting by Matthias Inverardi; Writing by Douglas Busvine; Editing by Tassilo Hummel and Alexander Smith) |
Does STL Global Limited's (NSE:SGL) P/E Ratio Signal A Buying Opportunity?
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The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). We'll show how you can use STL Global Limited's (NSE:SGL) P/E ratio to inform your assessment of the investment opportunity.What is STL Global's P/E ratio?Well, based on the last twelve months it is 0.68. In other words, at today's prices, investors are paying ₹0.68 for every ₹1 in prior year profit.
See our latest analysis for STL Global
Theformula for P/Eis:
Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS)
Or for STL Global:
P/E of 0.68 = ₹10.95 ÷ ₹16.04 (Based on the year to March 2019.)
A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That is not a good or a bad thingper se, but a high P/E does imply buyers are optimistic about the future.
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. So while a stock may look expensive based on past earnings, it could be cheap based on future earnings.
STL Global increased earnings per share by a whopping 40% last year.
One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. We can see in the image below that the average P/E (10.9) for companies in the luxury industry is higher than STL Global's P/E.
Its relatively low P/E ratio indicates that STL Global shareholders think it will struggle to do as well as other companies in its industry classification. While current expectations are low, the stock could be undervalued if the situation is better than the market assumes. If you consider the stock interesting, further research is recommended. For example, I often monitordirector buying and selling.
The 'Price' in P/E reflects the market capitalization of the company. So it won't reflect the advantage of cash, or disadvantage of debt. The exact same company would hypothetically deserve a higher P/E ratio if it had a strong balance sheet, than if it had a weak one with lots of debt, because a cashed up company can spend on growth.
Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio.
STL Global's net debt is considerable, at 200% of its market cap. This level of debt justifies a relatively low P/E, so remain cognizant of the debt, if you're comparing it to other stocks.
STL Global's P/E is 0.7 which is below average (15.4) in the IN market. The company may have significant debt, but EPS growth was good last year. The low P/E ratio suggests current market expectations are muted, implying these levels of growth will not continue.
When the market is wrong about a stock, it gives savvy investors an opportunity. If the reality for a company is not as bad as the P/E ratio indicates, then the share price should increase as the market realizes this. We don't have analyst forecasts, but shareholders might want to examinethis detailed historical graphof earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Are SG Company S.p.A.'s (BIT:SGC) Interest Costs Too High?
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While small-cap stocks, such as SG Company S.p.A. (BIT:SGC) with its market cap of €20m, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Evaluating financial health as part of your investment thesis is crucial, as mismanagement of capital can lead to bankruptcies, which occur at a higher rate for small-caps. The following basic checks can help you get a picture of the company's balance sheet strength. However, this is not a comprehensive overview, so I suggest youdig deeper yourself into SGC here.
SGC's debt levels surged from €3.1m to €6.6m over the last 12 months , which includes long-term debt. With this rise in debt, SGC's cash and short-term investments stands at €7.0m , ready to be used for running the business. On top of this, SGC has produced cash from operations of €2.3m in the last twelve months, resulting in an operating cash to total debt ratio of 35%, indicating that SGC’s debt is appropriately covered by operating cash.
Looking at SGC’s €13m in current liabilities, it seems that the business has been able to meet these commitments with a current assets level of €21m, leading to a 1.63x current account ratio. The current ratio is the number you get when you divide current assets by current liabilities. For Media companies, this ratio is within a sensible range since there is a bit of a cash buffer without leaving too much capital in a low-return environment.
SGC is a highly-leveraged company with debt exceeding equity by over 100%. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses.
Although SGC’s debt level is towards the higher end of the spectrum, its cash flow coverage seems adequate to meet obligations which means its debt is being efficiently utilised. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. I admit this is a fairly basic analysis for SGC's financial health. Other important fundamentals need to be considered alongside. I recommend you continue to research SG to get a more holistic view of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for SGC’s future growth? Take a look at ourfree research report of analyst consensusfor SGC’s outlook.
2. Valuation: What is SGC 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 SGC is currently mispriced by the market.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Why Fundamental Investors Might Love Shilpa Medicare Limited (NSE:SHILPAMED)
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Shilpa Medicare Limited (NSE:SHILPAMED) 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 SHILPAMED, it is a financially-healthy company with a a great track record of dividend payments 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, take a look at thereport on Shilpa Medicare here.
SHILPAMED is an attractive stock for growth-seeking investors, with an expected earnings growth of 23% in the upcoming year, bolstered by its outstanding cash-generating ability, as analysts predict its operating cash flows will more than double over the same time period. This is a sustainable driver of high-quality earnings, as opposed to pure cost-cutting activities. SHILPAMED'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. SHILPAMED appears to have made good use of debt, producing operating cash levels of 0.27x total debt in the prior year. This is a strong indication that debt is reasonably met with cash generated.
SHILPAMED 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 Shilpa Medicare, I've put together three fundamental aspects you should further examine:
1. Historical Performance: What has SHILPAMED'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 SHILPAMED 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 SHILPAMED is currently mispriced by the market.
3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of SHILPAMED? 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. |
Eric Trump's Hot Takes On Democratic 2020 Debate Blow Up In His Face
Eric Trump tried his hand at political punditry during Wednesday’s Democratic presidential debate, but his childish takes did not go over well. President Donald Trump’s son began by tweeting that he was “already bored.” I’m already bored — Eric Trump (@EricTrump) June 27, 2019 He later followed it up with these succinct posts: What a mess — Eric Trump (@EricTrump) June 27, 2019 #DemDebate pic.twitter.com/HR2P57e1lK — Eric Trump (@EricTrump) June 27, 2019 Trump’s tweets inevitably caught the attention of folks on his father’s favorite social media platform, where he was promptly ridiculed: Because it’s civil? — David W. Former Trump supporter (@davidmweissman) June 27, 2019 You could go read a book https://t.co/B2eP9Dexf5 — Senator Megan Hunt (@NebraskaMegan) June 27, 2019 People with small minds often are — Bart Harley Jarvis (@andrewtothemoon) June 27, 2019 Is this the SNL parody account? — M (@deadandburied81) June 27, 2019 Too many big words? https://t.co/urgrm1hJlY — Kara Eastman (@karaforcongress) June 27, 2019 I know, it’s so boring to watch people not hunting endangered animals. Pay that Irish bar tab yet? — Suzmcc☘️ (@SuzMcc) June 27, 2019 Here you go. For tomorrow night. pic.twitter.com/00ZOWBGq7b — Robin Madel (@RobinMadel) June 27, 2019 I'm never bored but then again l'm a stable genius. — 💧Rebecca (@rebeccafowler37) June 27, 2019 A debate isn’t supposed to be The Jerry Springer Show. You dad turned them into a 3-ring circus. He insults, belittled, name calls, make s#*t up, but he doesn’t debate. He doesn’t know how to. — Susan Welsh (@BadleeFan1) June 27, 2019 Not as tired and bored as the American people are of you and your whole clown show of a family, Eric. Believe me. 😂 — Paul A. Zeller 🇺🇸 🌊 (@pzeller1966) June 27, 2019 Not bored. Boring. You’re already boring. Tenses are hard. — Dennis Detwiller (@drgonzo123) June 27, 2019 Thanks for driving attention to the Democratic debates! https://t.co/XmrPkByoUP — Kelly Ellis (@justkelly_ok) June 27, 2019 go find your crayons https://t.co/HNjWh62IW5 — lalah hathaway (@lalahhathaway) June 27, 2019 I'm bored with you and your whole family — Mike Silver (@tutorindie) June 27, 2019 Are you watching reruns of the apprentice ? — Jesse Palacios (@Fliingmonkey74) June 27, 2019 Related... Story continues Trevor Noah Nails Why Donald Trump's 'Not My Type' Rape Denial Is So Vile Shep Smith Delivers Scathing Fact-Check Of Donald Trump’s Migrant Children Claim Kids Magazine Issues Blistering Takedown Of Trump Migrant Children Policies Also on HuffPost Love HuffPost? Become a founding member of HuffPost Plus today. This article originally appeared on HuffPost . View comments |
Is Shilpa Medicare Limited's (NSE:SHILPAMED) CEO Paid Enough Relative To Peers?
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The CEO of Shilpa Medicare Limited (NSE:SHILPAMED) is Vishnukant Bhutada. First, this article will compare CEO compensation with compensation at similar sized companies. Next, we'll consider growth that the business demonstrates. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Shilpa Medicare
Our data indicates that Shilpa Medicare Limited is worth ₹28b, and total annual CEO compensation is ₹81m. (This number is for the twelve months until March 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at ₹16m. When we examined a selection of companies with market caps ranging from ₹14b to ₹55b, we found the median CEO total compensation was ₹23m.
As you can see, Vishnukant Bhutada is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Shilpa Medicare Limited is paying too much. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
The graphic below shows how CEO compensation at Shilpa Medicare has changed from year to year.
Shilpa Medicare Limited has increased its earnings per share (EPS) by an average of 2.0% a year, over the last three years (using a line of best fit). In the last year, its revenue is down -7.1%.
I would argue that the lack of revenue growth in the last year is less than ideal, but I'm happy with the EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Given the total loss of 32% over three years, many shareholders in Shilpa Medicare Limited are probably rather dissatisfied, to say the least. This suggests it would be unwise for the company to pay the CEO too generously.
We compared the total CEO remuneration paid by Shilpa Medicare Limited, and compared it to remuneration at a group of similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
While we have not been overly impressed by the business performance, the shareholder returns, over three years, have been disappointing. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. If you think CEO compensation levels are interesting you will probably really likethis free visualization of insider trading at Shilpa Medicare.
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. |
Men are a third less likely to conceive after the age of 51
Not all men can expect to become fathers as late in life as Ronnie Woods (left) and Mick Jagger of the Rolling Stones. [Photo: Getty] Men trying for a child in their fifties are over a third less likely to conceive . This is according to new research, which found these men aged 51 and above are 34% less likely to become fathers compared to men of a younger age. It’s true that older fathers are by no means unheard of – think Rolling Stones’ Mick Jagger and Ronnie Woods, both becoming fathers in 2016 at the age of 68 and 73 respectively. However, the latest research shows that not all men can rely on prolonged fertility in older age. Researchers looked at data from 4,271 men trying to conceive through IVF at the Centre for Reproductive and Genetic Health (CRGH) in London between 2009 and 2018. READ MORE: A male contraceptive pill could be a step closer Men in the 51 and above age group had a 30.5% chance of conception, compared to the success rate for men under 35 who had an almost one in two chance of conception. There was also a significant difference between men under 35 and those in their 40s, with the rate of conception falling to 35.1% for men aged between 41 and 45. For those aged 45 to 50 this fell to 32.8%. This is believed to be down to a decline in sperm quality, which becomes damaged with age. While concerns about the biological clock normally centre around women’s age, these findings suggests that a man’s age can still have a significant impact on a couple’s fertility. “Men’s sperm seems to be unaffected by their age right up to the age of 50, which is when there is a significant decline,” said study lead Dr Guy Morris from the Centre for Reproductive and Genetic Health. He added: “Women lose the function of their reproductive organs when they go through the menopause. In men, the quality and quantity of sperm production declines with age and this seems to have a significant effect after the age of 50.” READ MORE: Men damaging fertility chances in a bid to look more attractive The study follows research released earlier this week which found teenage males following a junk food diet are causing irreversible damage to their sperm. Story continues Eating foods such as pizza, sugary drinks, chips and burgers can result in significantly lower sperm counts compared to following a healthier diet. Eating a junk food diet also causes oxidative damage to Sertoli cells – a type of cell contained in the testicles which is associated with producing healthy sperm. This effect cannot be reversed in later life. |
Is Shilpa Medicare Limited (NSE:SHILPAMED) Overpaying Its CEO?
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Vishnukant Bhutada is the CEO of Shilpa Medicare Limited (NSE:SHILPAMED). This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO.
See our latest analysis for Shilpa Medicare
At the time of writing our data says that Shilpa Medicare Limited has a market cap of ₹28b, and is paying total annual CEO compensation of ₹81m. (This figure is for the year to March 2018). We think total compensation is more important but we note that the CEO salary is lower, at ₹16m. We looked at a group of companies with market capitalizations from ₹14b to ₹55b, and the median CEO total compensation was ₹23m.
As you can see, Vishnukant Bhutada is paid more than the median CEO pay at companies of a similar size, in the same market. However, this does not necessarily mean Shilpa Medicare Limited is paying too much. We can better assess whether the pay is overly generous by looking into the underlying business performance.
You can see, below, how CEO compensation at Shilpa Medicare has changed over time.
On average over the last three years, Shilpa Medicare Limited has grown earnings per share (EPS) by 2.0% each year (using a line of best fit). It saw its revenue drop -7.1% over the last year.
I would prefer it if there was revenue growth, but I'm happy with the EPS growth. It's hard to reach a conclusion about business performance right now. This may be one to watch. Shareholders might be interested inthisfreevisualization of analyst forecasts.
With a three year total loss of 32%, Shilpa Medicare Limited would certainly have some dissatisfied shareholders. So shareholders would probably think the company shouldn't be too generous with CEO compensation.
We examined the amount Shilpa Medicare Limited pays its CEO, and compared it to the amount paid by similar sized companies. As discussed above, we discovered that the company pays more than the median of that group.
Over the last three years, shareholder returns have been downright disappointing, and the underlying business has failed to impress us. Considering this, we have the opinion that the CEO pay is more on the generous side, than the modest side. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Shilpa Medicare (free visualization of insider trades).
Important note:Shilpa Medicare may not be the best stock to buy. You might find somethingbetterinthis list of interesting companies with high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor 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 Shilpa Medicare Limited (NSE:SHILPAMED) Use Debt To Deliver Its ROE Of 9.2%?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Shilpa Medicare Limited (NSE:SHILPAMED).
Our data showsShilpa Medicare has a return on equity of 9.2%for the last year. One way to conceptualize this, is that for each ₹1 of shareholders' equity it has, the company made ₹0.092 in profit.
See our latest analysis for Shilpa Medicare
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Shilpa Medicare:
9.2% = ₹1.1b ÷ ₹12b (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 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.
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. 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. If you look at the image below, you can see Shilpa Medicare has a similar ROE to the average in the Pharmaceuticals industry classification (11%).
That's neither particularly good, nor bad. 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. I will like Shilpa Medicare better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying.
Companies usually need to invest money to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt 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.
While Shilpa Medicare does have some debt, with debt to equity of just 0.14, we wouldn't say debt is excessive. Its ROE is certainly on the low side, and since it already uses debt, we're not too excited about the company. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities.
Return on equity is useful for comparing the quality of different businesses. In my book the highest quality companies have high return on equity, despite low debt. 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. 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:Shilpa Medicare 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. |
China hopes new Pentagon chief seeks to avoid confrontation
BEIJING, June 27 (Reuters) - China hopes the new U.S. defence chief will seek to avoid confrontation with China, the defence ministry said on Thursday, in the Chinese military's first official reaction to the appointment of acting U.S. Defense Secretary Mark Esper.
The world's two largest economies are in the middle of a bruising trade war, but also have broader military disagreements, including over Chinese island building in the disputed South China Sea and U.S. support for self-ruled Taiwan, claimed by China as its own.
Speaking at a regular monthly news briefing, Chinese Defence Ministry spokesman Ren Guoqiang said it had noted the change of positions at the Pentagon, after Esper was appointed following his predecessor Patrick Shanahan's resignation this month.
China set great store on its military relationship with the United States, and stable, healthy ties in this area were good for both countries and what the world expected, Ren added.
"We hope that during Acting Defense Secretary Esper's time in office, the United States can work with China to put into effect the important consensus of the two countries' leaders and grasp the broad direction of no conflict and no confrontation."
China and the United States should also improve their risk management abilities, increase strategic mutual trust and ensure their military relationship becomes a stabiliser in their overall ties, Ren added. (Reporting by Ben Blanchard; Editing by Nick Macfie) |
Indonesian Mobile Phone Retailers Rally on Registration Rule
(Bloomberg) -- Shares of Indonesian mobile phone retailers rallied after the government announced plans to introduce a measure in August to curb the distribution of illegal handsets.
The government will issue a rule on Aug. 17 that will allow the regulator to track and deactivate handsets which have not been sold by local distributors, Communications Minister Rudiantara said by phone on Wednesday. The government will use a device identification, registration and blocking system, known as DIRBS, to help trace invalid International Mobile Equipment Identities, or IMEI.
“With this regulation in place, upcoming illegal cellphones could no longer be used in Indonesia,” RHB analysts Michael Setjoadi and Jessica Pratiwi wrote in a research note. The new measure “will immediately eradicate black-market phones, which account for about 25% of the market.”
The measure was intended to protect the local industries and foreign investments by handset makers such as Samsung Electronics Co., according to Janu Suryanto, director for electronics and telematics at the industry ministry.
Shares of PT Erajaya Swasembada and PT Sat Nusapersada jumped 2.6% at close. Both stocks outperformed the 0.7% rise in the Jakarta Composite Index.
(Updates with closing price.)
To contact the reporter on this story: Harry Suhartono in Jakarta at hsuhartono@bloomberg.net
To contact the editors responsible for this story: Divya Balji at dbalji1@bloomberg.net, Naoto Hosoda, Kurt Schussler
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Can Europe, Brexit inspire China's bid for mega market?
By Noah Sin
HONG KONG (Reuters) - Some in China's central bank are looking to draw inspiration from the European Union and Britain's relationship with the common market to help shape how China integrates its southern economic powerhouse with Hong Kong and Macau.
The Greater Bay Area already has a combined economy roughly the same size as Australia but the region of 11 major cities is relatively divided - not least because Hong Kong and Macau have their own currencies and legal systems that make integration a difficult task.
The central bank's branch in Shenzhen, under President Xing Yujing, produced a 295-page report on financial and economic integration in the bay, which suggested building a single market akin to the 28-state EU. The report was penned with China Merchants Bank's chief economist and published last month.
While the report highlights some of the benefits of European integration, it also acts to underline the challenges facing China in trying to harness the promise of an area that already houses worldscale financial markets, industrial centres and technology sectors.
Market experts say Hong Kong and Macau would have to give up some autonomy in setting rules and standards, and like Britain, decide on the degree to which they are willing to drop barriers to allow the freer movement of people and capital.
In the report, Xing made no bones about promoting the free movement of people and capital in the bay, and learning from proposals for Britain's exit from Europe - a proposition previously unexplored by Chinese officials, at least in public.
"European integration has enhanced the welfare of the European people," the Shenzhen branch of People's Bank of China told Reuters in a statement.
It spelled out that the suggestions do not represent official policy positions.
The UK has made "plenty of detailed, professional arrangements in... minimising Brexit's impact (while) maintaining integration with European economy and finance," it added.
GREATER FREEDOM
The European common market embraced the free movement of labour, which the Greater Bay Area should endorse to "maximise labour market productivity", Gary Smith, London-based managing director at Barings Investment Institute said.
"That's the way that the economic benefit is maximised. If it doesn't happen, then authorities are limiting potential gains," he said.
While Europe has abolished border controls between 26 countries, there are checkpoints between Hong Kong, Macau and mainland China, under the "One Country, Two Systems" arrangement, which ensures the two cities keep their way of life under Chinese rule.
For a potential solution, Xing pointed to Britain's idea of a 'soft' border with Ireland after Brexit, which aims to continue a free flow of goods and people between the Republic of Ireland and Northern Ireland.
An electronic border could be installed in the bay, whereby businesses pay tariffs online after crossing it, Xing's report recommended.
She also floated an EU-style 'passporting' system for financial services - the ability for those with regulatory approval in one jurisdiction to operate across many in a common area - a policy that could be rolled out across China later.
TOUGH BALANCE
Yet for financial integration to work, local officials will need to give up some power. "If you had no over-arching authority, you could see Shenzhen and Hong Kong competing on financial markets," said Smith.
Passporting, for example, requires rules and standards across the area to be aligned, which "inevitably takes away a lot of rule-making autonomy" from local authorities, Mark Simpson, partner at Baker McKenzie in London.
However, the concept of passporting is already embedded to a degree in schemes like Stock Connect, which allows Hong Kong and mainland-based investors mutual market access, said James Lau, who heads the city's Financial Services and the Treasury Bureau.
Since mainland China has capital controls, Stock Connect comes with ceilings on trading activity and a closed loop of capital flows - investors must convert gains back into their home currencies.
Xing's research showed a freer capital regime would be good for long-term growth in the bay, but warned of the "vicious cycle" of large outflows and yuan depreciation pressure if all controls are let loose.
Preserving these checks on capital flows will make it harder to promote the yuan's usage in the bay - another goal of Xing's - said Peter Reynolds, Greater China co-head of financial services at consultancy Oliver Wyman.
While Beijing may worry about the free flow of capital, Hong Kong could fret over the free flow of people that a more open system might allow.
"That's one of the major reasons why the UK is exiting (from the EU). It's the free flow of people," said Hong Kong's Lau.
Standard Chartered Bank said in a report earlier in June that "making border control less cumbersome while preserving the 'One Country, Two Systems' principle remains a tough balancing act for China."
"The idea of the Greater Bay Area is very powerful," Reynolds said of challenges in capital control. "But we're all struggling with the practical realities."
(Reporting by Noah Sin; Editing by Neil Fullick) |
China's June factory PMI seen in contraction as demand falters: Reuters poll
BEIJING (Reuters) - China's factory activity is expected to have pulled back for a second straight month in June, according to a Reuters poll of analysts, as domestic business conditions worsened and the protracted Sino-U.S. trade war hit demand.
The official Purchasing Manager's Index (PMI) for June is expected to have edged up to 49.5 from May's reading of 49.4, according to the median forecast of 20 economists. However, that's still below the 50-point mark that separates expansion from contraction on a monthly basis.
A downbeat reading, along with sombre indicators seen in May and April, would suggest economic growth is likely to slow this quarter and increase the prospect of further policy easing in the coming months.
"We expect factory activity to remain weak in the short run as domestic and overseas demand faltered, which was set to continue denting investment and output," said Tang Jianwei, a senior economist at Bank of Communications in Shanghai.
China's industrial output growth hit a more than 17-year low in May, dragged by exports while producer price inflation also slowed on faltering demand.
The official PMI and its sister survey on the services sector are released on Sunday, a day after leaders of the Group of 20 nations end their meeting in Osaka, Japan.
U.S. President Donald Trump and Chinese counterpart Xi Jinping are scheduled to hold talks at the summit, their first meeting since trade talks broke off in May.
The costly tariff dispute between the world's two largest economies has ignited deep fears about a global recession and pressured financial markets.
While China's exports unexpectedly returned to growth in May, analysts attributed that to front-loading of U.S.-bound exports to avoid new tariffs on about $300 billion of goods that Trump is threatening to impose.
Separately, China's Emerging Industries PMI (EPMI), which was jointly published by Chinese Academy of Science and Technology for Development and China Federation of Logistics & Purchasing and a barometer for the country's high-tech sector, fell to 50.2 in June from 52.4 in May.
To deal with the economic challenges, policymakers have released a range of stimulus measures and are expected to launch more, especially if U.S.-China trade negotiations fail to produce a workable agreement soon.
The People's Bank of China (PBOC) has already slashed RRR six times since early 2018 in a bid to turn around soft credit growth. It has also injected large amounts of liquidity into the financial system and guided short-term interest rates lower.
Premier Li Keqiang stoked expectations of more action this week, pledging measures to cut real interest rates on financing for small and micro firms.
Analysts at Capital Economics said in a note they expect the PBOC's 7-day reverse repo rate will decline by 75 basis points in the coming quarters, with the first cut potentially coming in the next few weeks.
A private business survey - the Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) - which focuses more on small and medium-sized Chinese firms - is expected to show growth stalled last month, with the reading falling slightly to 50.0 from 50.2 in May. The Caixin manufacturing PMI will be released on Monday and its services PMI on Wednesday.
(Reporting by Lusha Zhang and Ryan Woo; Editing by Sam Holmes) |
AeroVironment, Inc. (NASDAQ:AVAV): Earnings To Drop Next Year
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On 30 April 2019, AeroVironment, Inc. (NASDAQ:AVAV) announced its latest earnings update. Overall, analyst consensus outlook appear bearish, as a 16% fall in profits is expected in the upcoming year relative to the past 5-year average growth rate of 42%. Presently, with latest-twelve-month earnings at US$42m, we should see this fall to US$35m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. For those keen to understand more about other aspects of the company, you canresearch its fundamentals here.
See our latest analysis for AeroVironment
The longer term expectations from the 6 analysts of AVAV is tilted towards the positive sentiment. Since forecasting becomes more difficult further into the future, broker analysts generally project out to around three years. To understand the overall trajectory of AVAV's earnings growth over these next fews years, I've fitted a line through these analyst earnings forecast to determine an annual growth rate from the slope.
By 2022, AVAV's earnings should reach US$43m, from current levels of US$42m, resulting in an annual growth rate of 6.3%. However, if we exclude extraordinary items from net income, we see that earnings is projected to fall over time, resulting in an EPS of $1.76 in the final year of forecast compared to the current $1.77 EPS today. Analysts are predicting this high revenue growth to squeeze profit margins over time, from 13% to 8.8% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For AeroVironment, there are three fundamental aspects you should further research:
1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Valuation: What is AeroVironment 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 AeroVironment is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of AeroVironment? 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. |
Nissan's Saikawa gets lowest approval among directors endorsed at AGM: filing
TOKYO (Reuters) - Nissan Motor Co Chief Executive Hiroto Saikawa had the lowest approval among the 11 directors endorsed by shareholders at its annual general meeting (AGM) this week, gaining only 78% of the votes, a filing showed on Thursday.
The low approval comes in the wake of a rare public rebuke for Saikawa from international proxy firms. International Shareholder Services and Glass Lewis earlier this month had urged shareholders to vote against him, citing the need to break with the scandal-plagued era of his former boss, Carlos Ghosn.
Saikawa, a former Ghosn lieutenant, trailed well behind the 99.1% votes in favor of Jean-Dominique Senard, chairman of Nissan partner Renault SA. The two men had a public spat this month over Nissan's governance reforms that raised concerns about the future of the automaking alliance.
Nissan released the breakdown of votes from the annual shareholders meeting in a filing to Japan's financial watchdog.
Saikawa's standing among shareholders has eased somewhat from the last vote two years ago, when his directorship was endorsed by 79.9% of shareholders who voted. Only Ghosn had a lower approval at that time, receiving 75.4%.
Nissan shareholders on Tuesday voted in favor of a new governance structure and board to address lax auditing revealed after the arrest of Ghosn over financial misconduct allegations. Ghosn, who is awaiting trial in Tokyo and out on bail, denies all the charges against him.
In a separate filing, Nissan said it would forgo paying Ghosn deferred retirement benefits totaling 4.44 billion yen ($41 million), along with 2.27 billion yen in share-related rights, after it accused its former chairman of underreporting his salary from the automaker.
Ghosn's planned compensation for the year to March totaled 1.65 billion yen, comprising 410 million yen which had been paid, and a payment of 1.24 billion yen which would have been paid after retirement.
Nissan canceled the latter payment after firing Ghosn as chairman following his arrest in Japan in November.
Ghosn has been charged with five counts of financial misconduct, and has essentially been under house arrest in Tokyo while he faces trial next year.
(Reporting by Naomi Tajitsu; Editing by David Dolan and Himani Sarkar) |
How Does Investing In Auryn Resources Inc. (TSE:AUG) Impact The Volatility Of Your Portfolio?
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If you're interested in Auryn Resources Inc. (TSE:AUG), 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. First, we have company specific volatility, which is the price gyrations of an individual stock. Holding at least 8 stocks can reduce this kind of risk across a 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 mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. 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 Auryn Resources
Given that it has a beta of 1.22, we can surmise that the Auryn Resources share price has been fairly sensitive to market volatility (over the last 5 years). Based on this history, investors should be aware that Auryn Resources 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 Auryn Resources is growing earnings and revenue. You can take a look for yourself, below.
With a market capitalisation of CA$208m, Auryn Resources is a very small company by global standards. It is quite likely to be unknown to most investors. It has a relatively high beta, suggesting it is fairly actively traded for a company of its size. Because it takes less capital to move the share price of a small company like this, when a stock this size is actively traded it is quite often more sensitive to market volatility than similar large companies.
Beta only tells us that the Auryn Resources 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 Auryn Resources’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 AUG’s future growth? Take a look at ourfree research report of analyst consensusfor AUG’s outlook.
2. Past Track Record: Has AUG 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 AUG's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how AUG 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. |
Singapore regulator says it sees Libra’s potential but requires more information
Facebook is in talks with another financial regulator over Libra.
The Monetary Authority of Singapore (MAS) has spoken to the firm about its new cryptocurrency project - but there are still serious concerns,Bloomberg reports.
“The key challenge is to figure out the nature of the beast,” said MAS Managing Director Ravi Menon. “What is it more like and which box we can put it into. At this point we are not sure.”
Menon noted Libra could offer an alternative to existing cross-border payments systems which are “expensive, inefficient, [and] sometimes risky.” However, he also noted there are new initiatives already in the works that address the same issue, and that it remains uncertain whether Libra is “a distinctly superior proposition.”
Ultimately, incomplete information about Libra is fuelling doubts amongmultiple European central banksand regulators too. France, which is currently presiding over the Group of Seven (G7), is planning toset up a task forceto look into Libra from an international level, while the Bank for International Settlements (BIS) said in a report that Facebook's project couldharm the banking sector. Meanwhile, in the U.S.,a Senate hearing on Libra has been scheduledfor mid-July. |
Rite Aid Delivers Another Disappointment With Its Q1 Results
There wasn't much for investors to be excited about the last timeRite Aid Corporation(NYSE: RAD)reported its quarterly results. The pharmacy chain's revenue fell with a wider net loss. Rite Aid has been a big loser for investors so far this year, too, with the stock plunging more than 50%.
Rite Aid reported its first-quarter earnings results after the market closed on Wednesday. Investors hoping for some good news for a change were sorely disappointed. Here's what you need to know from Rite Aid's Q1 update.
Image source: Getty Images.
Rite Aid reported revenue in the first quarter of $5.37 billion. This reflected a slight decrease from the prior-year-period revenue total of $5.39 billion. It also fell a little short of the consensus Wall Street analyst projection of $5.38 billion.
The company's Q1 net loss reported under generally accepted accounting principles (GAAP) was $99.6 million, or $1.88 per share. This was much worse than the $41.7 million, or $0.79 per share, GAAP net loss reported in the same quarter of 2018.
Rite Aid posted an adjusted non-GAAP net loss in the first quarter of $7.5 million, or $0.14 per share. Analysts were expecting an adjusted net loss of $0.07 per share.
The pharmacy chain ended the first quarter with cash and cash equivalents of $190.5 million. This was an increase from the $144.4 million on hand as of March 2, 2019.
It was another disappointing quarter for the drugstore chain. Revenue for Rite Aid's retail pharmacy segment decreased by 0.8% to $3.86 billion. Although pharmacy services segment revenue increased 1.5% year over year, it wasn't enough to offset the decline for Rite Aid's larger retail segment.
The decline in retail pharmacy sales stemmed primarily from a reduction in store count in the first quarter. Rite Aid closed four stores and opened one new store for a net decrease of three stores in its total count. Pharmacy services sales increased slightly year over year due in large part to an increase in Medicare Part D revenue.
Rite Aid's most discouraging news was its deteriorating bottom line. There were several reasons for the company's widening net loss, including higher restructuring-related costs and higher income taxes. Rite Aid also faced prescription reimbursement rate pressure that weakened its pharmacy gross profit margin.
Rite Aid maintained its 2020 outlook. It continues to project that full-year revenue will be between $21.5 billion and $21.9 billion. The company also still anticipates a GAAP net loss between $170 million and $220 million, with adjusted earnings between a loss of $0.14 per share and net income of $0.72 per share.
There were several assumptions made with this forecast. Rite Aid expects pressure to continue on prescription reimbursement rates. However, the company also thinks that it will see same-store prescription volume growth and benefit from its cost savings initiatives.
CEO John Standley stated that the company thinks that enhancements made to its supply agreement withMcKessonand generic purchasing improvements could help improve its fortunes in the future. He also noted that Rite Aid is "identifying significant opportunities to drive further growth and operating efficiency in fiscal 2021, with a focus on reducing our reliance on traditional pharmacy reimbursement rate models."
Rite Aid has a lot of work to do to turn things around, though. Investors hoping that a white knight might swoop in to acquire the company could have a long wait.
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U.S. Congress clashes over border funding as migrants kept in squalor
June 27 (Reuters) - The U.S. House and Senate will try to resolve their conflicting versions of an emergency funding bill on Thursday to address worsening humanitarian conditions for migrant children and families on the U.S.-Mexico border.
The Republican-controlled Senate passed by an overwhelming 84-8 vote a $4.6 billion spending bill on Wednesday. The Democratic-led House of Representatives on Tuesday night tied more strings to its approval of the money, setting standards for health and nutrition of migrants in custody after reports they lacked necessities such as soap and diapers.
A photo of drowned migrants, and reports of horrendous conditions for detained children have spurred efforts to craft compromise legislation to send to U.S. President Donald Trump before Congress recesses this week for the U.S. Independence Day holiday.
Whether Trump will sign a deal is uncertain as he continues to push for spending on the kind of border security some Democratic adversaries blame for migrant deaths.
Trump has made cracking down on immigration a centerpiece of his administration but officials are saying they will run out of money for border agencies soon. Border crossings hit the highest level in over a decade in May, straining resources and creating chaotic scenes at overcrowded border patrol facilities.
The need for funding has become more urgent as attorneys last week called attention to more than 300 children detained in squalid conditions at a border patrol facility in Clint, Texas. Trump has made building wall along the southern border a key goal of his administration but government officials say they need money to keep migrant housing facilities open past month end.
Border crossings hit their highest monthly level since 2006 in May, with over 60% of migrants either children or families, mostly from Central America.
Lawyers and human rights workers said they found sick and hungry children when they visited a border patrol facility in Clint, Texas earlier this month.
"Many had been detained for weeks, one even up to a month in really horrific conditions," said Clara Long, senior researcher at Human Rights Watch.
The conditions of unaccompanied children crossing the border has become a key issue in the 2020 presidential race. During Wednesday night's debate, many of the Democratic candidates called for an overhaul of U.S. immigration laws and about 12 of them are set to visit a Florida facility this week.
A photo of a Salvadoran father and his toddler daughter who drowned attempting to cross the Rio Grande added urgency on both sides of the aisle to reach a funding deal.
Trump criticized the House bill on Wednesday, telling Fox Business Network he wanted more money for "protection" from the drug traffickers and other criminals he says are taking advantage of the family surge to slip into the country. (Reporting by Susan Cornwell and Richard Cowan in Washington; Additional reporting by Omar Younis in Los Angeles; Writing by Andrew Hay; Editing by Bill Tarrant and Lisa Shumaker) |
The 2020 Ford Super Duty Goes After the Ram Power Wagon with a Tremor Off-Road Package
Photo credit: Ford From Car and Driver Ford is adding an off-road Tremor package to the Super Duty range of heavy-duty trucks. Available on crew-cab models with either of the available upgrade engines, the Tremor package adds off-road equipment such as meaty tires, a lifted suspension, and other rugged bits. The Tremor package will be available by the end of 2019 on the updated 2020 F-250 and F-350 models. The Ram 2500 has the Power Wagon, the GMC Sierra HD has the AT4, and now Ford's Super Duty pickup has its own in-house off-road trim. Called the Tremor, this new option package will be rolling out onto the updated 2020 Ford Super Duty range , and it offers significant off-road equipment compared to the mostly appearance-based FX4 package Ford currently offers. Key mechanical changes for the Tremor include a lift kit that raises the front suspension by two inches, a front axle with a limited-slip differential, and a locking rear differential. A set of 35-inch Goodyear Wrangler Duratrac off-road tires wrap around 18-inch matte black wheels. The Tremor also has different shocks than those on a standard Super Duty. The front air dam is five inches higher than normal, which helps the truck's approach angle, and Ford says that the Tremor model can ford water up to 33 inches deep. A new rock-crawl mode operates in low range, and Ford also has an optional Trail Control system that operates like a sort of off-road cruise control. Photo credit: Ford The name Tremor may sound familiar. That's because it was previously used on a street-focused version of the F-150 a few years ago. The name has now been repurposed for this off-road version of the Super Duty, although the sticker slapped onto the tailgate looks pretty similar to us. While there's no pricing information out yet, the Tremor package will be available on XLT, Lariat, King Ranch, and Platinum trim levels. It comes only with the crew-cab body style and either of the F-250 and F-350's upgrade engines: the new 7.3-liter gasoline V-8 and the 6.7-liter turbo-diesel. We estimate the package will cost somewhere around $2000 when it goes on sale at the end of 2019. ('You Might Also Like',) Unclogging Streets Could Help City Dwellers Save 125 Hours a Year The 10 Cheapest New Cars of 2018 Get Out Early, Get In Late: What to Know About Auto Lease Transfers |
General Moly Announces Positive Results of Annual Meeting
LAKEWOOD, COLORADO / ACCESSWIRE / June 27, 2019 /General Moly, Inc. (the "Company") (NYSE American and TSX: GMO), the only western exchange listed, pure-play molybdenum mineral development company, announced that it received approval for all proposals submitted to stockholders at its Annual Meeting of Stockholders, which was held on June 24, 2019 in Lakewood, Colorado.
Stockholders re-elected Chief Executive Officer Bruce D. Hansen and Mark A. Lettes to the Board of Directors to each serve for a term of three years. Stockholders also overwhelmingly approved by 90.9% of votes cast to amend the Company's certificate of incorporation to allow the Board the flexibility to effect a reverse stock split. This proxy proposal had been prompted by the notice of deficiency by the NYSE American LLC in December 2018 as the General Moly stock had traded for a low price for an extended period of time.
The Company is pleased to report that with its improved average stock price, the NYSE American recently notified the Company that it is back in compliance with the stock exchange's continued listing standards. Thus, the Company does not anticipate the need to effect a reverse stock split. The stockholder-approved proxy measure allowing the Board to effect a reverse stock split expires one year from the proxy vote.
In addition at the Annual Meeting of Stockholders, stockholders also approved the Company's executive compensation structure through an advisory vote, and the 2006 executive compensation plan as amended and restated, and ratified the selection of Plante & Moran PLLC as the Company's independent registered public accounting firm for 2019.
Voting results on all matters voted on at the Annual Meeting of Stockholders is shown below and will be filed onwww.sedar.com.
[["Director Nominee", "", "% of VotesFor", "", "", "% of Votes Against", "", "", "% of Votes Abstain", ""], ["Bruce D. Hansen", "", "", "98.4", "%", "", "", "0.5", "%", "", "", "1.1", "%"], ["Mark A. Lettes", "", "", "91.2", "%", "", "", "7.2", "%", "", "", "1.6", "%"], ["Proposals", "", "", "", "", "", "", "", "", "", "", "", ""], ["Advisory vote on executive compensation", "", "", "96.2", "%", "", "", "2.1", "%", "", "", "1.7", "%"], ["Approve 2006 incentive plan", "", "", "92.3", "%", "", "", "5.8", "%", "", "", "1.9", "%"], ["Amend certificate of incorporation", "", "", "90.9", "%", "", "", "7.4", "%", "", "", "1.7", "%"], ["Ratify selection of accounting firm", "", "", "96.3", "%", "", "", "0.6", "%", "", "", "3.1", "%"]]
*****
About General Moly
General Molyis a U.S.-based, molybdenum mineral exploration and development company listed on the NYSE American (NYSE AMER), recently known as the NYSE MKT and former American Stock Exchange, and the Toronto Stock Exchange under the symbol GMO. The Company's primary asset, an 80% interest in theMt. Hope Projectlocated in central Nevada, is considered one of the world's largest and highest grade molybdenum deposits. Combined with the Company's wholly-ownedLiberty Project, a molybdenum and copper property also located in central Nevada, General Moly's goal is to become the largest primary molybdenum producer in the world.
Molybdenum is a metallic element used primarily as an alloy agent in steel manufacturing. When added to steel, molybdenum enhances steel strength, resistance to corrosion and extreme temperature performance. In the chemical and petrochemical industries, molybdenum is used in catalysts, especially for cleaner burning fuels by removing sulfur from liquid fuels, and in corrosion inhibitors, high performance lubricants and polymers.
Contact:
Scott Roswell(303) 928-8591info@generalmoly.comWebsite:www.generalmoly.com
SOURCE:General Moly, Inc.
View source version on accesswire.com:https://www.accesswire.com/550033/General-Moly-Announces-Positive-Results-of-Annual-Meeting |
To Win Over Asia, Tinder is Trying To Shed its Hookup Image
(Bloomberg) -- During its first four years, Tinder, the popular dating and hookup-facilitating smartphone app, largely ignored everything west of the Pacific. Tailoring the service to varied local dating rituals in Asia was deemed too challenging for the fledgling company. For example, premarital sex is frowned upon in the Philippines, arranged marriages are commonplace in India and sogaeting (blind dates arranged by friends) is the norm in Korea.But that has changed. As Tinder’s explosive subscriber growth has started to wane in North America, its parent company, IAC/Interactive Corp.’s Match Group Inc., has done what so many companies have done before: it’s looked to Asia.Over the past two years, the company has been strategizing a way to expand in the region, where millions of single people have never tried a dating app. To win over Asia, Tinder is reinventing itself.
In South Korea, the company is trying to shed its reputation as a hookup app—instead, it’s selling itself as a place to find new friends. In university towns, new billboards have emerged for Tinder: “New Year, New Friends, New You.” In Seoul, illuminated cubes adorn subway stations with models blowing chewing gum bubbles while asking if “anyone is down for a quick chit-chat.” Famous South Korean pop star Seungri signed on as the local face of Tinder, telling his fans that many of his friends around the world use the app. The strategy seems to be working. In the past two years alone, Tinder’s user base has more than doubled. In 2015, Tinder didn’t even feature in the top five dating apps by downloads on iOS or Google Play in South Korea, according to analytics firm App Annie, but now it’s ranked No. 1 for both downloads and monthly active users in the country.
A generation ago, women in South Korea were pressured to get married and start having children in their early 20s. It was typical for families to spend small fortunes on match-making gurus to set their child up with someone from an equal socio-economic background.
“During my parent’s generation, women got married straight after college graduation,” Jieun Choi, 26, said. “People in our generation were raised by such parents who expected us to go through that rite of passage.” Her parents began urging her to date in her early 20s and even her chiropractor weighed in, suggesting a love life could help ease her back pain. “Being a single, you’re kind of considered incomplete,” she said.
The way young Koreans have traditionally found romantic partners is sogaeting, where a mutual friend sets two people up on a blind date, or meetings where groups of friends all hang out together and pair off. “There’s no casual meetup that happens spontaneously in Korea. Friends introduce you to friends,” Choi said.
The atmosphere is changing, though. After leading an independent life while studying abroad in Hong Kong, Choi moved back to Seoul recently and said the old-fashioned match-making traditions felt inapt.
About five years ago, a number of Korean entrepreneurs were watching the meteoric rise of Match in the U.S. and noticed a gap in their market. Homegrown apps like Amanda and Sky People started attracting millions of subscribers.
Lyla Seo, 35, saw this as an opportunity when she became Tinder’s first general manager in South Korea in July 2017. At the time, Tinder had no marketing strategy to court the tech-savvy Korean population, and so she partnered with a research agency to conduct interviews with local users.
Her most significant discovery was the lack of awareness about Tinder and how it should be used. Seo found young Koreans were desperate to meet new people and hang out. So Tinder invited hundreds of young men and women to roller skating discos, secret concerts with pop singers and all-day surfing clubs. Tinder advertisements are everywhere: TV, Facebook, buses, movie theaters.Those familiar with Tinder’s more transactional reputation in the West are bemused. “Tinder is so tied into American culture, the thought that it could hide its identity in Korea is kind of absurd,” said University of Michigan Professor Fred Feinberg, who has studied the marketing behind online dating apps.
Match’s foray into Asia stretches beyond South Korea. Match Chief Executive Officer Mandy Ginsberg is betting big on this corner of the world, spending more money on marketing in Korea, India and Japan than anywhere else in the world, despite the Asia Pacific region only pulling in 12% of Match’s revenue last year. In May, she told analysts this would increase to 25% by 2023.
In an interview, Ginsberg recalled recently attending her nephew’s wedding in India and when she was speaking to a group of his friends who live in the country, she asked if anyone thought they might meet their significant other through an arranged marriage. “They all started laughing at me and said, ‘that ended with our parents,” Ginsberg said. “This generation is different.”
If anything is going to upset Ginsberg’s plan, it’s the cultural nuances. In America, Tinder profiles tend to be overrun with selfies and swimsuit shots, while profiles in South Korea include pictures of users’ favorite food, pets or hobbies. In India, religion, language and caste are important features in a potential mate. In Japan, it’s typical for prospective suitors to list their blood type, or ketsuekigata, on their dating profiles as a hint at their personality type, alongside their salary and an often inflated height.
To understand all these intricacies, Match has been seeking local managers with knowledge of local customs. In India, Match has a new general manager, Taru Kapoor, who is working to improve the chances of matching people with compatible cultural views by asking new users to disclose their thoughts on the #MeToo movement and whether women should continue working after marriage. Junya Ishibashi was elevated to general manager for Match in Japan and Taiwan. He is trying to lobby the government to backtrack on strict regulations enforced in the 1990s that ban marketing dating products on television, near public transit stations or on Google. Match is also targeting Indonesia, Singapore and Vietnam.
The recent announcement of Tinder Lite, an app targeted towards emerging markets, will certainly help with Match’s expansion eastward, said Cowen analyst John Blackledge. Tinder Lite will be smaller to download and take up less space on smartphones to make it more effective in remote regions where data usage comes at a premium. “If localization is what’s needed, that’s the direction they will go,” he said. “They want to win.”
--With assistance from Pavel Alpeyev and Sohee Kim.
To contact the author of this story: Olivia Carville in New York at ocarville1@bloomberg.net
To contact the editor responsible for this story: Emily Biuso at ebiuso@bloomberg.net, Andrew Pollack
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
Secrets to Credit Score Success
Consumer Reports has no financial relationship with advertisers on this site. If you think your credit history determines only the interest rate you get on home mortgages , car loans, and credit cards , you’d be wrong, but you certainly wouldn’t be alone. In a recent U.S. News & World Report survey, less than half of the 1,497 respondents knew that in many states poor credit could lead to higher home and auto insurance rates or being denied an apartment (CR opposes the use of credit reports for these purposes). The consequences go even further: Employers in many areas can use credit reports to vet job candidates, and having a low credit score could mean paying $4,000 more for a typical car loan or $200,000 more for credit over the course of a lifetime than someone with a high credit score. There are several types of credit scores , but the FICO score is one of the most widely used by lenders, which makes it a good barometer of your overall creditworthiness. According to the Fair Isaac Corporation, which creates more than a dozen versions of the score for various types of lenders, all of them are based on assorted forms of credit data (such as payment history and amounts owed) provided by the three major credit bureaus—Experian, TransUnion, and Equifax. Each form of credit data is given a different weight (see “ The 5 Keys to Your Credit Score ,” below). Finding your credit score can be a frustrating process if you don’t know where to look. The Fair Isaac Corporation and credit reporting agencies will provide your FICO score for a fee, but there are several ways to find it at no charge. For instance, if your bank, credit card issuer, or lender participates in FICO Score Open Access , you may be able to get it free just by logging in to your account. Discover, which is among the cards that provide FICO scores to its cardholders, will also provide the scores at no cost to non-customers who share information (including their Social Security number), which the company says it will protect from misuse. Story continues Though it does not provide the actual score, FICO’s free Credit Scores Estimator provides a range within which a consumer’s score is likely to fall based on answers to 10 questions. Making Sense of Your Score FICO scores typically range from a low of 300 to a high of 850. (The national average FICO score is 704.) In general, a score above 800 will qualify you for the lowest interest rates, though even a score in the high 600s should qualify you for a favorable rate. Experian, one of three major credit bureaus, defines the boundaries this way: 800-plus: Exceptional. Less than 1 percent of borrowers in this range are likely to become seriously delinquent. They’ll easily be approved for the lowest rates. 740-799: Very good. One percent of borrowers in this category are likely to become seriously delinquent. They could be offered the lowest rates from lenders, but it’s not a given. 670-739: Good. Eight percent could become seriously delinquent. This stratum includes the average U.S. credit score. People in this range are considered an “acceptable” lending risk. 580-669: Fair. An estimated 27 percent of the people in this group could become seriously delinquent, making them likely candidates for subprime loans at higher rates. 579 and below: Poor. This group is considered a poor lending risk: Roughly 62 percent could become seriously delinquent. They will be eligible only for the highest interest rates, if they can get credit at all. Though missing just one payment can ding your score, even a major downturn in your luck or behavior is unlikely to drop it into the very lowest range. Bruce W. McClary, vice president of communications at the National Foundation for Credit Counseling, a group that represents nonprofit credit counseling agencies, says the lowest score he’s ever seen was 425, for a consumer who had already been in bankruptcy and was delinquent with several creditors. “Obsessing over perfecting your score might be a waste of time,” says Katie Ross, education and development manager for American Consumer Credit Counseling, a nonprofit that offers guidance to consumers. Instead, “focus your efforts on keeping it within a healthy range,” she says. The 5 Keys to Your Credit Score FICO scores are based on the following factors, supplied by credit reporting agencies: 35% Payment History 10% New Credit 10% Credit Mix 15% Length of Credit History 30% Amount of Debt The Five Keys to Your Credit Score FICO scores are based on the following factors, supplied by credit reporting agencies: 35% Payment History 10% New Credit 10% Credit Mix 15% Length of Credit History 30% Amount of Debt 10 Ways to Raise Your Credit Score Taking these actions can help to raise a sagging score. Just don’t expect it to happen overnight: Depending on the reasons for a poor score, it could take from 12 to 24 months to see a difference. 1. Regularly monitor your credit reports. Mistakes on your credit reports can be costly—and common. A study by the Federal Trade Commission found that 1 in 5 consumers had an error on his or her credit report that was corrected after it was disputed. Consumers are entitled to receive three free credit reports each year—one from each of the three major credit reporting agencies: Equifax, Experian, and TransUnion. A smart way to monitor your credit is to go to annualcreditreport.com and request a free report from a different agency every four months. Common errors to look for include: credit accounts that aren’t reflected, duplicate credit accounts, debts incurred by a former spouse, and bad debts older than seven years. You can initiate a dispute online at each of the three major credit reporting agencies. 2. Pay your bills on time. Approximately 35 percent of the FICO score is determined by your payment history, and 96 percent of those with the highest FICO scores have no missed payments. It’s better to pay the minimum on credit cards each month than to fall behind. 3. Don’t apply for several credit cards at once. This generates numerous inquiries into your credit history, which may lower your score. Another reason: Opening several new credit accounts at the same time reduces the average “age” of your accounts, which can also lower your credit score. However, multiple requests within a 45-day period for a single type of credit (mortgage, auto loan, or student loan, for instance) are counted as a single inquiry to allow consumers to shop around for the best rate. These are less likely to lower your score. 4. Don’t cancel unused cards (unless they carry an annual fee). Roughly a third of your score is based on the ratio of credit used to total available credit. Eliminating a card will lower your available credit and can work against you. FICO Scores on the Rise National average score, six-month intervals FICO Scores on the Rise National average score, six-month intervals But Younger Consumers Still Lag Behind Average FICO score by age, April 2018 But Younger Consumers Still Lag Behind Average FICO score by age, April 2018 5. Keep credit balances low. Because a high credit ratio can negatively affect your score, maintaining a low revolving credit balance is wise. (Most people with the highest FICO scores owe less than $3,000 on revolving accounts.) 6. If you charge everything on a rewards card for the points, switch to cash or a debit card for a couple of months before applying for new credit. Even if you pay your balances in full every month, a lot of debt relative to your credit limit can still be viewed negatively. 7. Maintain a variety of credit types. Successfully paying, say, an auto loan, a student loan , and credit card bills over the same period shows that you’re able to juggle different types of credit. That diversification accounts for 10 percent of your score. 8. Pay off debt in collection. With the most current version of the FICO score, debt that was referred to a collection agency but has been paid off will no longer count against you. (Always dispute any debt that has been wrongly assigned to you.) 9. Get a secured credit card after bankruptcy. If you’ve been through bankruptcy, using a secured credit card backed by a refundable deposit may be an effective way to start rebuilding your credit. A bankruptcy will have less impact on your score over time if you don’t default on new loans. It may be a while before you can access credit inexpensively again: Chapter 7 and Chapter 13 bankruptcies stay on your credit report for up to 10 years. 10. Consider new tools that can boost your credit score. Consumers with little credit history or less-than-stellar scores may now use two new tools that could boost creditworthiness by taking into account additional information, such as utility or mortgage payments and bank balances. Click here for the pros and cons of these . Editor's Note: This article also appeared in the August 2019 issue of Consumer Reports magazine. Consumer Reports has no financial relationship with advertisers on this site. More from Consumer Reports: Top pick tires for 2016 Best used cars for $25,000 and less 7 best mattresses for couples Consumer Reports is an independent, nonprofit organization that works side by side with consumers to create a fairer, safer, and healthier world. CR does not endorse products or services, and does not accept advertising. Copyright © 2019, Consumer Reports, Inc. |
Should You Be Impressed By Apple Inc.'s (NASDAQ:AAPL) ROE?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Apple Inc. (NASDAQ:AAPL).
Our data showsApple has a return on equity of 54%for the last year. One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.54 in profit.
See our latest analysis for Apple
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Apple:
54% = US$57b ÷ US$106b (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 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 looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the profit over the last twelve months. The higher the ROE, the more profit the company is making. So, 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. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. Pleasingly, Apple has a superior ROE than the average (9.2%) company in the Tech industry.
That is a good sign. We think a high ROE, alone, is usually enough to justify further research into a company. For example,I often check if insiders have been buying shares.
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 and second cases, the ROE will reflect this use of cash for investment in the business. 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.
Apple does use a significant amount of debt to increase returns. It has a debt to equity ratio of 1.06. I think the ROE is impressive, but it would have been assisted by the use of debt. 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 when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
Of courseApple 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. |
A Note On Electronic Arts Inc.'s (NASDAQ:EA) ROE and Debt To Equity
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
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 Electronic Arts Inc. (NASDAQ:EA), by way of a worked example.
Electronic Arts has a ROE of 19%, based on the last twelve months. One way to conceptualize this, is that for each $1 of shareholders' equity it has, the company made $0.19 in profit.
View our latest analysis for Electronic Arts
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Electronic Arts:
19% = US$1.0b ÷ US$5.3b (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the 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 Electronic Arts has a similar ROE to the average in the Entertainment industry classification (16%).
That's neither particularly good, nor bad. ROE tells us about the quality of the business, but it does not give us much of an idea if the share price is cheap. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Most companies need money -- from somewhere -- to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used.
Although Electronic Arts does use debt, its debt to equity ratio of 0.19 is still low. The combination of modest debt and a very respectable ROE suggests this is a business worth watching. 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. 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.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
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. |
Singapore Airlines, Malaysia Airlines to explore wide-ranging partnership
By Jamie Freed
SINGAPORE (Reuters) - Singapore Airlines <SIAL.SI> and Malaysia Airlines have signed a preliminary agreement to explore a wide-ranging strategic partnership that could include more codeshares as well as cargo and aircraft maintenance, the companies said on Thursday.
The cooperation between the airlines, which split out from Malaysia-Singapore Airlines in 1972, comes amid financial trouble at Malaysia Airlines.
The Malaysian government is considering whether to shut, sell or refinance the loss-making national carrier, Prime Minister Mahathir Mohamad said in March.
Shukor Yusof, the head of Malaysian aviation consultancy Endau Analytics, said between the Singapore Airlines deal and a recent joint venture agreement with Japan Airlines Co Ltd <9201.T> there appeared to be little chance the government would sell its national carrier.
"Malaysia Airlines needs as many tie-ups as possible to stay alive," he said. "That said, Singapore Airlines is likely to gain more having a bigger, wider market and network and more importantly, deeper pockets."
The new cooperation could include "a significant expansion of codeshare flights beyond Singapore-Malaysia routes, as well as enhancements on the frequent flyer program front", both airlines said in a joint statement.
CAPA Centre for Aviation Chief Analyst Brendan Sobie said the stronger partnership would allow Singapore Airlines to increase its presence in the strategically important Malaysian market and help Malaysia Airlines compete more effectively against rivals like AirAsia Group Bhd <AIRA.KL>.
The carriers said they intended for a formal agreement to be finalised in the coming months subject to regulatory approvals and that it would include Singapore Airlines subsidiaries SilkAir and Scoot as well as Malaysia Airlines' Firefly arm.
"This will naturally start speculation that Singapore Airlines could be the white knight strategic investor that Malaysia Airlines needs and the Malaysian government has been advocating for, but there would be so many challenges that would need to be overcome to make that a serious option," Sobie said.
Ties between the two neighbors, which were a single country until Singapore split from Malaysia in 1965, have been strained at times.
The most recent spat was over maritime borders and air space between Singapore and Malaysia's southern-most state of Johor. The countries agreed in January to take steps to de-escalate tensions.
(Reporting by Jamie Freed in Singapore; additional reporting by Rashmi Ashok in Bengaluru and Joseph Sipalan in Kuala Lumpur; Editing by Himani Sarkar and Mark Potter) |
Is Electronic Arts Inc.'s (NASDAQ:EA) 19% ROE Strong Compared To Its Industry?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand Electronic Arts Inc. (NASDAQ:EA).
Our data showsElectronic Arts has a return on equity of 19%for the last year. Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.19.
View our latest analysis for Electronic Arts
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Electronic Arts:
19% = US$1.0b ÷ US$5.3b (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.
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. Clearly, then, one can use ROE to compare different companies.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. The image below shows that Electronic Arts has an ROE that is roughly in line with the Entertainment industry average (16%).
That's not overly surprising. ROE tells us about the quality of the business, but it does not give us much of an idea if the share price is cheap. If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first and second cases, the ROE will reflect this use of cash for investment in the business. In the latter case, the 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 Electronic Arts does have some debt, with debt to equity of just 0.19, we wouldn't say debt is 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. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreereport on analyst forecasts for the company.
Of courseElectronic Arts 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. |
The Latest: Japan welcomes Xi as sign of improving ties
OSAKA, Japan (AP) — The Latest on the meeting of leaders of the Group of 20 major economies (all times local): 7:05 p.m. Japan is welcoming Chinese President Xi Jinping to the G-20 summit as a sign of improving ties. Chief Cabinet Secretary Yoshihide Suga told reporters Thursday that Japan-China relations are on the recovery track and he hopes to further elevate them. Relations between the two countries have sunken to their lowest in the past few years over territorial disputes involving islands in the East China Sea as well as Japan's wartime actions. Xi arrived in Osaka earlier Thursday to attend the summit that Prime Minister Shinzo Abe will chair on Friday and Saturday. Suga says he expects Abe and Xi will have constructive talks and dinner later Thursday. Xi will also hold talks with President Donald Trump on Saturday, a meeting that is capturing a major attention amid their trade disputes. ___ 5:55 p.m. A Chinese Foreign Ministry spokesman in Beijing says China intends to defend itself against further U.S. moves to penalize it due to trade friction. Geng Shuang says threats by President Donald Trump to impose more tariffs on Chinese exports "won't work on us because the Chinese people don't believe in heresy and are not afraid of pressure." Geng made the comments ahead of Trump's arrival in Osaka for a G-20 summit. Trump and Xi are due to meet on the sidelines of the two-day meeting on Saturday. The meeting, more than a month after trade talks between the U.S. and China foundered, has raised hopes the two sides might manage to bridge some differences and cool tensions that led them to raise tariffs on billions of dollars of each other's products. ___ 4:35 p.m. Japan's top government spokesman is responding to President Donald Trump's criticism that the U.S.-Japan security pact is one-sided. Chief Cabinet Secretary Yoshihide Suga says their obligations under the treaty are not identical but balanced. He says "It is irrelevant to say the treaty is one-sided." Story continues Trump told U.S. media that the U.S.-Japan pact unfairly puts burden on Washington. Suga declined to say if Prime Minister Shinzo Abe planned to correct Trump when they hold talks during the Group of 20 Summit in Osaka. About 50,000 American troops under the pact are hosted by Japan, whose neighbors include Russia, China and North Korea. ___ 4:15 p.m. Environmental activists and local residents in Kobe have protested and raised an inflatable depicting Japanese Prime Minister Shinzo Abe, urging an end to funding for coal-fired power plants. The protesters Thursday were taking aim at Abe's efforts to promote such projects. They also want more aggressive efforts by the Japanese government to help curb climate change. The coalition of more than 50 nongovernment groups, including Kiko Network and Friends of the Earth, said in a statement that Japan is one of the largest funders of coal fired-power stations overseas. It ramped up use of coal-fired generators inside Japan after most nuclear power plants were idled after the 2011 nuclear disaster in Fukushima. The activists staged their protest outside a coal-fired power plant in the port city. ___ 3:20 p.m. While prospects for detente in the trade war between the world's two largest economies are a major preoccupation ahead of the two days of G-20 meetings that begin Friday, many participating are calling for a broader perspective in tackling global crises. The president of the European Union Council, Donald Tusk, told Japanese Prime Minister Shinzo Abe on Thursday: "This will be a difficult G-20. There are global challenges to be met. We need to step up to avoid the climate threats." Tusk said that other pressing issues include reforming the World Trade Organization and dealing with international tensions over Iran. Japanese media reported that the Tusk and Abe made progress toward an agreement on loosening EU restrictions on exports of farm products imposed after a 2011 nuclear accident in northeastern Fukushima prefecture. ___ 1:33 p.m. Chinese President Xi Jinping and other world leaders are gathering in Osaka for a summit of the Group of 20 major economies that is likely to be overshadowed by both trade and geopolitical tensions. President Donald Trump was due to arrive later Thursday, and to meet with Xi on Saturday as the G-20 meetings conclude. Xi was also expected to hold talks with Prime Minister Shinzo Abe, seeking a breakthrough after years of strain over territorial disputes. It is his first visit to Japan since he became communist China's top leader in 2013. Xi's visit to North Korea last week raised hopes for some movement in the impasse with the U.S. over Pyongyang's nuclear program. Trump is due to visit South Korea after leaving Japan. |
Oregon GOP state senators fled state to avoid climate change vote
Eleven Republican state senators made a run for the neighboring border fleeing Oregon in order to avoid voting on a cap-and-trade bill to combat climate change.
Oregon State Senator Tim Knopp (R) is among those who left the state.
“We’re going to represent our constituents to the best of our abilities and when our constituents’ voices are ignored and disrespected, we are going to do everything we can to make sure that they have some influence into this process,” he said on “Bulls & Bears” Wednesday.
The senate president has indicated the bill is dead and the dramatic effort to block a vote may have worked, delivering the Republicans the win. Over 100 bills are reportedly in danger as Oregon GOP senators remain in hiding.
“This action was a last resort for us and we worked for months to try to give the kind of concerns addressed that our constituents have,” Knopp said.
Oregon cap-and-trade bill would place a cap on most of the state’s greenhouse gas emissions and lower it over time. The House Bill 2020 expected to increase costs, particularly on fuel.
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Knopp said 2,000 union jobs, along with blue collar and family wage jobs that are in jeopardy because of the climate bill.
“We said we are going to stand and fight with these workers and make sure they get represented,” he said.
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Singapore’s Central Bank Wants More Information on Facebook’s Libra Crypto
Singapore’s central bank, the Monetary Authority of Singapore (MAS), is seeking more information from Facebook about its recently unveiled cryptocurrency project, Libra.
Asreportedby Bloomberg, MAS managing director Ravi Menon said at a media briefing on Thursday that his institution has held talks with the social media giant over concerns about how Libra would function, although he acknowledged there are potential benefits too.
Currently, MAS is having trouble deciding on how to categorize Libra in terms of regulation. “At this point we are not sure yet,” Menon said.
Related:Another Indian Crypto Exchange Shuts Down Blaming Banking Ban
Regarding the possible benefits, he said that Libra “offers a very interesting proposition that could help to address” existing “expensive, inefficient, sometimes risky” methods of remittance.
However, MAS needs more information to gauge these benefits over existing electronic payments systems. The regulator needs to understand “how exactly it’s going to work.” Menon said, including aspects such as Libra’s economics, security and privacy.
Menon’s comments come as the latest in a line of global regulators to state that more information is needed to understand the benefits and risks of Libra.
Authorities inItaly, the U.K. and Francehave recently indicated that Libra raises issues that must be examined.
Related:Buried in Facebook’s Libra White Paper, a Digital Identity Bombshell
Over in the U.S., the House Financial Services Committee willhost a hearingon Facebook’s libra cryptocurrency next month, just a day after the Senate Banking Committee holds its own hearing.
Maxine Waters, chair of the powerful House committee, has raised concerns that Facebook’s token could ultimately rival the dollar, while French finance minister Bruno Le Maire has said it’s “out of question’’ that Libra be allowed to “become a sovereign currency. It can’t and it must not happen.”
As a result, France iscreating a task forcewithin the Group of Seven (G7) nations to examine the issues.
Facebookimage via Shutterstock
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'League of Legends' publisher hires Nielsen to measure sponsorship value
By Hilary Russ
NEW YORK (Reuters) - Tencent Holdings Ltd's Riot Games said on Thursday that Nielsen Holdings PLC will measure the value of sponsoring Riot's "League of Legends," the most-watched esport in the world, through next year.
Quantifying the value of brand exposure gained through sponsorships of League of Legends teams, games and leagues could help the multiplayer online battlefield game, abbreviated as LoL, draw more sponsors.
While other publishers have also worked with Nielsen on sponsorship measurement, fans have watched more LoL matches than any other game, totaling 347.4 million live hours in 2018 on Twitch and YouTube Gaming, according to gaming analytics firm Newzoo.
LoL has 13 regional leagues with more than 800 players on 100 professional teams globally.
The game has already drawn big companies - even those not endemic to the esports universe - including State Farm, Mastercard Inc and Nike Inc.
Esports - where throngs of fans watch competitive professional video game matches live and online - has become an increasingly important funnel for brands to reach younger, more affluent and digitally savvy audiences who watch less television.
"As esports continues to gain momentum with brand marketers and advertisers, the need for independent, third-party verification of audiences and brand exposure is critical," said Nicole Pike, managing director of Nielsen Esports, in a statement.
Nielsen will measure LoL's brand exposure throughout 2019 and 2020, including during the North American League of Legends Championship Series, its European Championship, its three international events and for some regional leagues in Asia.
"As major companies invest in our tournaments, we want to help them see the value of their exposure and identify how best to engage with our passionate fan base," said Doug Watson, head of esports insights at Riot.
Nielsen's measurement is based on the quality, duration and location of brand exposure, in addition to the size of the audience seeing or hearing the mention of that brand's identity.
(Reporting by Hilary Russ; Editing by Cynthia Osterman) |
What Kind Of Share Price Volatility Should You Expect For Cabot Microelectronics Corporation (NASDAQ:CCMP)?
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If you're interested in Cabot Microelectronics Corporation (NASDAQ:CCMP), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The 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 mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one.
Check out our latest analysis for Cabot Microelectronics
Given that it has a beta of 1.4, we can surmise that the Cabot Microelectronics share price has been fairly sensitive to market volatility (over the last 5 years). If the past is any guide, we would expect that Cabot Microelectronics shares will rise quicker than the markets in times of optimism, but fall faster in times of pessimism. Many would argue that beta is useful in position sizing, but fundamental metrics such as revenue and earnings are more important overall. You can see Cabot Microelectronics's revenue and earnings in the image below.
Cabot Microelectronics is a reasonably big company, with a market capitalisation of US$3.2b. 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.
Since Cabot Microelectronics 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 CCMP is a good investment for you, we also need to consider important company-specific fundamentals such as Cabot Microelectronics’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 CCMP’s future growth? Take a look at ourfree research report of analyst consensusfor CCMP’s outlook.
2. Past Track Record: Has CCMP 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 CCMP's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how CCMP 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. |
Items stolen from Disneyland's Star Wars: Galaxy's Edge are being sold for a fortune on eBay
Disneyland Star Wars: Galaxy's Edge (Credit: Chris Pizzello/Invision/AP) Visitors to Disneyland's long-awaited new Star Wars attraction, Galaxy's Edge , are pinching items and selling them for a fortune on eBay. The sprawling new area, covering 14 acres in the north west corner of the park in Anaheim, California, opened at the end of last month. Read more: Mark Hamill is finished with Star Wars But already, 'memorabilia' that shouldn't be leaving the park is appearing for sale on auction sites, with Star Wars collectors already snapping it up. A 'pilot assignment card' from the Millennium Falcon: Smuggler's Run ride, which are handed out by park actors to riders who then operate different parts of the iconic ship, but are supposed to be handed back afterwards, has been listed for $400 around £315. Pilot assignment card from Galaxy's Edge (Credit: eBay) Many other items are popping up on the auction site too. Maps of the park for those lucky enough to have snagged tickets so far are up for grabs at the right price, as are bottles of water, beermats and glasses in which the galactic blue and green milk is served. (Credit: eBay) One of the round bottles of specially designed Coco-Cola will set you back £35. Meanwhile, a metal spork from the Oga's Cantina, one of the attraction's restaurants, is currently being sold for £150 (plus postage). A spork from Galaxy's Edge (Credit: eBay) But according to the Orange County Register , staff are now being assigned to make sure that diners at Oga's Cantina aren't walking out with glasses, menus or, indeed, sporks, which are now Read more: Hamill says Episode 9 is a missed opportunity Disneyland is yet to comment on the matter. View comments |
One Thing To Remember About The Cabot Microelectronics Corporation (NASDAQ:CCMP) Share Price
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Anyone researching Cabot Microelectronics Corporation (NASDAQ:CCMP) might want to consider the historical volatility of the share price. Volatility is considered to be a measure of risk in modern finance theory. Investors may think of volatility as falling into two main categories. First, we have company specific volatility, which is the price gyrations of an individual stock. Holding at least 8 stocks can reduce this kind of risk across a portfolio. The second sort is caused by the natural volatility of markets, overall. For example, certain macroeconomic events will impact (virtually) all stocks on the market.
Some stocks mimic the volatility of the market quite closely, while others demonstrate muted, exagerrated or uncorrelated price movements. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one.
See our latest analysis for Cabot Microelectronics
Looking at the last five years, Cabot Microelectronics has a beta of 1.4. The fact that this is well above 1 indicates that its share price movements have shown sensitivity to overall market volatility. If the past is any guide, we would expect that Cabot Microelectronics shares will rise quicker than the markets in times of optimism, but fall faster in times of pessimism. Beta is worth considering, but it's also important to consider whether Cabot Microelectronics is growing earnings and revenue. You can take a look for yourself, below.
Cabot Microelectronics is a reasonably big company, with a market capitalisation of US$3.2b. 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.
Since Cabot Microelectronics tends to moves up when the market is going up, and down when it's going down, potential investors may wish to reflect on the overall market, when considering the stock. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as Cabot Microelectronics’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 CCMP’s future growth? Take a look at ourfree research report of analyst consensusfor CCMP’s outlook.
2. Past Track Record: Has CCMP 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 CCMP's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how CCMP 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. |
Bitcoin DEX Bisq Sees Record Volume After Localbitcoins Bans Cash
P2P bitcoin (BTC) trading platformBisqis seeing record trading volumes as users dropLocalbitcoins, data from monitoring resourceCoin Danceconfirmed this week.
Bisq, theDEXformerly known as Bitsquare, is adecentralizedapplication facilitating crypto-to-fiat trades without a formal intermediary.
For the week ending June 22, the most recent period for which data is available, the platform handled $6.1 million, its best performance on record.
Noticeable upticks came from markets as diverse and theUnited KingdomandBrazil, the former seeing its second-biggest volumes.
The increased activity comes weeks after Localbitcoins, traditionally the go-to P2P trading platform, abruptlywithdrewthe option for users to meet and perform trades forcash.
Part of a series of increased know-your-customer (KYC) moves, dropping cash sparked criticism, with competitor LocalEthereumrushing to hookdeserted traders.
Many P2P markets rely heavily on cash exchange, as users either have no access to the banking system or feel unable to rely on it,as is the casewith countries such asVenezuela.
The latest data underscores the change in consumer habits with Localbitcoins failing to capitalize on bitcoin breaking $10,000 and higher.
Volumes across the platform for the seven days to June 22 actually fell compared to previous weeks,reaching $56.4 million.
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Have Insiders Been Buying Cordoba Minerals Corp. (CVE:CDB) Shares This Year?
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellCordoba Minerals Corp.(CVE:CDB), you may well want to know whether insiders have been buying or selling.
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. 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 Cordoba Minerals
While there weren't any large insider transactions in the last twelve months, it's still worth looking at the trading.
In the last twelve months insiders paid CA$185k for 1.9m shares purchased. In the last twelve months Cordoba Minerals insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Cordoba Minerals is not the only stock that insiders are buying. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket.
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own CA$312k worth of Cordoba Minerals stock, about 1.2% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We consider this fairly low insider ownership.
The fact that there have been no Cordoba Minerals insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. While we have no worries about the insider transactions, we'd be more comfortable if they owned more Cordoba Minerals stock.I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph.
But note:Cordoba Minerals 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. |
Could Centric Health Corporation's (TSE:CHH) Investor Composition Influence The Stock Price?
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The big shareholder groups in Centric Health Corporation (TSE:CHH) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.'
Centric Health is a smaller company with a market capitalization of CA$37m, so it may still be flying under the radar of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are not on the share registry. Let's delve deeper into each type of owner, to discover more about CHH.
View our latest analysis for Centric Health
We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.
There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Centric Health's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.
We note that hedge funds don't have a meaningful investment in Centric Health. There is some analyst coverage of the stock, but it could still become more well known, with time.
The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.
I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that insiders maintain a significant holding in Centric Health Corporation. Insiders have a CA$5.8m stake in this CA$37m business. This may suggest that the founders still own a lot of shares. You canclick here to see if they have been buying or selling.
The general public, who are mostly retail investors, collectively hold 60% of Centric Health shares. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.
We can see that Private Companies own 25%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.
Many find it usefulto take an in depth look at how a company has performed in the past. You can accessthisdetailed graphof past earnings, revenue and cash flow.
But ultimatelyit is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look atthis free report showing whether analysts are predicting a brighter future.
NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Anthony Hilton: Care homes would benefit from L&G’s thinking cap
Hot on the heels of a £150 million charitable donation to Oxford University by Blackstone’s Stephen Schwarzman, today we have a £4 billion commitment to Oxford from Legal & General to launch a 50:50 partnership with the university.
It is not quite the same thing because Legal & General expects a return on its money but it is still probably the first recent commitment by a City institution to fund science parks, world-class research and laboratory facilities, office space and housing on this scale.
The aim is to develop the infrastructure of Oxford so it can maintain its status as a world-leading university. All told it will support 10,000 people. But whereas most City institutions invest money, Legal & General is building for the future by creating real assets.
Oxford has much the same problems as London when it comes to affordable housing, or lack of it. If the university is to continue to attract research staff, as well as supporting spin-out businesses, something has to be done.
Affordable residential and commercial space is a key component of the partnership. Indeed, as John Cummins, head of Legal & General’s Future Cities business, said: “Each ground-breaking discovery depends not just on the academics but on the infrastructure supporting them.” The Future Cities business invests in urban renewal to generate long-term results from regeneration, clean energy, infrastructure, housing and SME finance.
The Schwarzman gift is terrific but is by definition just that, a gift, and so sits at the charitable end of the spectrum outlined. Moving along that spectrum you find assorted variants of impact investing where some income is forgone and there is a socially positive impact, to environmental, social and governance investing and then to red-blooded maximisation of returns.
This partnership is, however, an approach which sits in a different place in that it delivers in much bigger scale, for a commercial return for investors, while delivering positive effects. It is all about patient capital, producing long-term assets with long-term funds. Legal & General first uses its balance sheet in the Future Cities fund to buy the infrastructure. These then will become assets for the annuity book to help back pension deals and for the investment management arm for other pension-centric investments in LGIM. Thus they have a three-legged structure of asset funding, asset management and asset creation.
This, if you like, is the good side of private equity. But away from Legal & General there is also a less positive side, where again the end market is pensioners, but where they chose to invest in care homes.
Private equity thought the sector had all the ingredients, a fragmented market ripe for consolidation; property assets to buy, sell and make money on in a rising market; leverage so the businesses can be loaded up with debt; and a guaranteed modest income from councils who would have more people to care for and an obligation too.
But in fact this kind of private equity did not work. They mopped up hundreds of care homes, many from husband and wife partnerships, by adding debt. But Brexit-related uncertainty hit property values, and council funding was not the provider it was meant to be either. So almost all the leveraged care homes came unstuck. As a consequence three of the top four care homes — HC-One, Barchester, and Care UK — are up for sale and struggling to find buyers. The second-largest, Four Seasons, with 17,000 residents and 20,000 staff, also appointed administrators this spring.
Four Seasons particularly has not had a good innings. It was owned in 2012 by Terra Firma, Guy Hands’ private equity business which put in £525 million of debt, but the group struggled to make the interest payments.
As a result Hands lost all his £100 million equity, and has taken a £450 million loss on the business, which ran out of cash in December 2017. Hands then sold much of the debt to H/2 Capital Partners, a distressed-debt specialist. Now it also seems to have written off the debt.
The real culprit though is not Four Seasons, nor even the private-equity operators. It is a lack of funding. The Government will surely have to acknowledge its obligations to the elderly at some point.
But when will that be? Certainly the Tory leadership hopefuls have not given it a thought. Perhaps they should talk to Legal & General. |
Did You Manage To Avoid Centric Health's (TSE:CHH) Painful 55% Share Price Drop?
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Generally speaking long term investing is the way to go. But along the way some stocks are going to perform badly. To wit, theCentric Health Corporation(TSE:CHH) share price managed to fall 55% over five long years. We certainly feel for shareholders who bought near the top. And we doubt long term believers are the only worried holders, since the stock price has declined 39% over the last twelve months. The falls have accelerated recently, with the share price down 41% in the last three months.
View our latest analysis for Centric Health
Given that Centric Health 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. 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 five years Centric Health saw its revenue shrink by 13% per year. That's definitely a weaker result than most pre-profit companies report. It seems appropriate, then, that the share price slid about 15% annually during that time. We don't generally like to own companies that lose money and don't grow revenues. You might be better off spending your money on a leisure activity. You'd want to research this company pretty thoroughly before buying, it looks a bit too risky for us.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
Balance sheet strength is crucual. It might be well worthwhile taking a look at ourfreereport on how its financial position has changed over time.
Centric Health shareholders are down 39% for the year, but the market itself is up 1.1%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 15% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. You could get a better understanding of Centric Health'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 CA exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
Bull Of The Day: Diodes Incorporated (DIOD)
Diodes Incporated (DIOD) is a Zacks Rank #1 (Strong Buy) and its sports an A got value and growth. Normally, I like the names that have strong growth scores and weaker value scores as that tells me I am on the right path because growth investors and value investors are looking for different things. Let's take a look at why this is a Zacks Rank #! (Strong Buy). Description Diodes Incorporated is a leading manufacturer and supplier of high-quality discrete and analog semiconductor products, primarily to the communications, computing, industrial, consumer electronics and automotive markets. The Company's corporate sales, marketing, engineering and logistics headquarters is located in Southern California, with two manufacturing facilities in Shanghai, China, a wafer fabrication plant in Kansas City, Missouri, engineering, sales, warehouse and logistics offices in Taipei, Taiwan and Hong Kong, and sales and support offices throughout the world. Diodes, Inc. recently acquired Anachip Corporation, a fabless analog IC company in Hsinchu Science Park, Taiwan. It's product focus is on subminiature surface-mount discrete devices, analog power management ICs and Hall-effect sensors all of which are widely used in end-user equipment. Earnings History DIOD has a great history of beating the number. I see four straight beats of the Zacks Consensus Estimate, and the most recent one is the biggest of the bunch. I see a 13% positive earning surprise that took place back in early May… but with broader market softness, shareholders were not rewarded. The average positive earnings surprise over the course of the last four reports is a +8.33%. Estimate Revisions DIOD has seen a lot of positive earnings estimate revisions. The current quarter moved up to 75 cents from 67 cents before the most recent earnings report. The next quarter also saw a nine cent increase as well to bring that number to 80 cents. Story continues The full year 2019 saw a big move of 30 cents, up from $2.50 to $2.80. That is the type of thing that powers a stock to become a Zacks Rank #1 (Strong Buy). Valuation The value style score for DIOD is an A, and let’s take a look at why that is. I see a 12x forward earnings multiple, which for a chip stock is pretty low. A 1.67x book multiple is also very low. At the same time I see a 10% annual top line growth rate and a 1.4x sales multiple. Operating margins have increased in each of the last two quarters, so things look good here. Chart Diodes Incorporated Price and Consensus Diodes Incorporated Price and Consensus Diodes Incorporated price-consensus-chart | Diodes Incorporated Quote More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020. Click here for the 6 trades >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Diodes Incorporated (DIOD) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research |
Transat's stock closes at $14.19 as Air Canada 30-day negotiating period ends
With a 30-day negotiating period over its future coming to a close, Transat A.T. Inc’s stock ended Wednesday at $14.19, higher than the initial takeover offer from Air Canada.
Air Canada announced on May 16that it was in exclusive talks to buy the airline and travel tour operator for $13 a share, valuing the company at $520 million. In a separate statement, Transat said it had agreed to a 30-day period of exclusive negotiations with Canada’s largest airline, which expired on Wednesday.
Air Canada and Transat had not released statements about the results of the 30-day negotiation period as of 5:30 p.m. ET on Wednesday.
Air Canada’s offer represented a 23 per cent premium on Transat’s stock price at the time of the offer. Since then, the company’s stock price has surpassed Air Canada’s bid while Transat has received additional takeover offers.
Group Mach Inc., a real estate development firm, has proposed to acquire all of Transat’s shares for $14 each, or $527.6 million. The company said Tuesday it had submitted an amended version of its proposal removing conditions related to financing from the Quebec government and the execution of support and voting agreements with the Fonds de solidarite FTQ and the Caisse de depot et placement du Quebec.
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UPDATE 2-Euro zone bond yields dip as German inflation disappoints
* German inflation remains well below target
* Bond yields head back towards lows
* Euro zone periphery govt bond yields http://tmsnrt.rs/2ii2Bqr (Updates with nationwide German inflation number)
By Virginia Furness and Dhara Ranasinghe
LONDON, June 27 (Reuters) - Germany's government bond yields fell back towards record lows on Thursday after data showed annual inflation in the euro zone's biggest economy remained well below the European Central Bank's target in June.
Bond yields had inched higher earlier in the session as hopes for a U.S.-China trade deal and state inflation numbers from Germany put some upward pressure on borrowing costs.
In North Rhine-Westphalia, Germany's most populous state, inflation accelerated to 1.7% from 1.6%. In Bavaria, consumer prices rose by 1.8% after a 1.6% increase in May.
But the nationwide number showed German consumer prices, harmonised to make them comparable with inflation data from other European Union countries, rose by 1.3% year-on-year in June after increasing by the same amount in the previous month.
"At the start of the day we had optimism about trade and during the day the German inflation number came out that was only in line with expectations, so that was the main driver for lower yields," said DZ Bank rates strategist Sebastian Fellechner.
In late trade, Germany's 10-year bond yield was down 1.2 basis points at minus 0.32%, nearing Tuesday's record low of minus 0.336%.
Most other 10-year yields in the bloc were about one bps lower on the day, reversing earlier rises of around 2 bps.
The overall inflation data from Germany only reinforced expectations for further monetary easing from the European Central Bank, analysts said.
"As so often over the last years, if inflation is not even picking up in Germany, with a strong labour market and an economic expansion of 10 years, where else in the eurozone should it pick up?," ING chief economist Carsten Brzeski said in a note.
European Commission data meanwhile showed euro zone economic sentiment dropped to its lowest point in nearly three years in June with confidence falling markedly in Germany and Italy.
That backdrop has been favourable for euro zone issuers to come to the markets.
Austria this week was able to place a five year bond at a yield of -0.435%, becoming the first euro zone sovereign to price a public sale of debt below the -0.40% deposit rate.
It also reopened its 100-year bond to raise an additional 1.25 billion euros
Italy followed up on Thursday by selling five and 10-year bonds at their lowest yields in more than a year. (Reporting by Virginia Furness and Dhara Ranasinghe) |
H&M Gains as Retailer Shows Early Progress Toward Turnaround
(Bloomberg) -- Hennes & Mauritz AB surged after the struggling Swedish clothing retailer showed progress coping with a buildup of unsold garments, raising hopes that the worst may be over after a three-year slump in earnings.
Inventory dropped slightly as a proportion of sales, easing to 18.2% at the end of May from a record 18.9% as of last August, H&M said Thursday. Chief Executive Officer Karl-Johan Persson said H&M still aims to boost operating profit this year. The stock rose as much as 11% Thursday in Stockholm.
A pickup in revenue growth at the start of the third quarter, helped by a heat wave in Europe, is boosting optimism that the retailer may have returned to a level of sales growth that could gradually put the inventory issue behind it. H&M pledged to reduce discounts for a fourth consecutive quarter as it aims to reduce its 40-billion kronor ($4.5 billion) buildup of unsold garments.
Analysts pointed to the June revenue growth of 12% as the trigger for the share gain. The stock can be volatile because short sellers have targeted H&M, betting against almost a fifth of the freely traded shares.
Better Composition
The retailer said that the composition of inventory has improved, implying it will become easier to sell the garments. The family-controlled company has a goal of eventually reducing stock-in-trade to 12% to 14% of sales, a level last seen three years ago. When asked in an interview if that could take four of five years, CEO Persson said it should be less than that, saying he’s “confident” H&M is heading in the right direction.
“H&M is improving its offer, which should lead to a sales and earnings recovery in time, albeit with execution risk in an ongoing tough competitive environment,” wrote Richard Chamberlain, an analyst at RBC Europe.
The company has recently been offering discounts of up to half off on summer clothes, offering $1.99 camisole tops, $25.99 faux leather biker jackets and skinny jeans for $8.99.
H&M also cut this year’s store expansion plan by 26% while pledging more investment in e-commerce. H&M now expects 130 net store openings, further decelerating from a rate that exceeded 400 in recent years. Most of the new H&M shops will be outside of Europe and the U.S. as the retailer seeks faster-growing markets.
H&M has been plowing investment into e-commerce, adding online sales in Mexico, Thailand, Indonesia and Egypt this year.
The Swedish retailer is trying to catch up after Zara owner Inditex SA made it possible to order clothes from its chains from virtually anywhere in the world. H&M’s e-commerce reach extends to about 48 markets.
Inditex has forecast sales growth of 4% to 6% this year on a like-for-like basis as the Spanish retailer outperforms rivals such as Gap Inc.
H&M is also trying to catch up with Inditex’s lead in RFID, a technology that allows retailers to track the location of clothes in stores and warehouses to boost efficiency. The Swedish retailer said it now uses RFID in 15 markets. Zara uses it in all its stores.
The Swedish retailer said it plans to launch H&M on Indian e-commerce platform Myntra and its & Other Stories chain on China’s Tmall by this autumn.
H&M warned that the weak krona is still pushing up buying costs as the retailer buys the bulk of its garments in Asia, where prices are linked to dollars. The krona was on average about 10% weaker against the dollar in the second quarter.
Pretax profit dropped 1.3% in the three months through May, missing analysts’ estimates and declining an eighth consecutive quarter.
To contact the reporters on this story: Thomas Mulier in Geneva at tmulier@bloomberg.net;Hanna Hoikkala in Stockholm at hhoikkala@bloomberg.net
To contact the editors responsible for this story: Eric Pfanner at epfanner1@bloomberg.net, John J. Edwards III
For more articles like this, please visit us atbloomberg.com
©2019 Bloomberg L.P. |
'Huge financial loss': Canadian meat producers concerned about China's meat ban
Canadian meat producers say they are concerned about China’s decision to ban imports of the country’s beef and pork products and that the move will “create huge financial loss” for the industry.
The Chinese Embassy released a statement late Tuesday that requested Canada suspend exports of meat to China after customs authorities found residues of ractopamine, a restricted feed additive, in a batch of pork products. China said a subsequent investigation found that falsified health certificates were attached to the batch of pork.
The Canadian Meat Council, an industry group representing meat packers, processors and equipment suppliers, released a statement saying it is working closely with the government to understand the situation and determine next steps.
“Meat processors, along with the entire meat and livestock industry, are extremely concerned as this will have a significant business impact on our sector and will create huge financial loss for our industry,” the Canadian Meat Council said.
“We are aware that Canadian government officials have been in contact with their Chinese counterparts and are hopeful this will lead to a quick resolution of the issue for trade to resume.”
China is a key market for both the Canadian beef and pork industries.
The Canadian Meat Council says China is Canada’s fifth largest export market for beef, valued at $97 million as of 2018, with exports jumping 388 per cent so far in 2019.
According to the Canadian Pork Council, China was Canada’s second largest market for pork products, with exports topping $514 million in 2018. Sales of pork products to China have increased 50 per cent so far in 2019. The move by China has set off aglobal chain reaction in pork trade, with other nations expected to pick up the demand.
“China is a very important market for Canadian producers,” the Canadian Pork Council said in a statement.
The ban on Canadian meat products comes as Canada grapples with a strained relationship with China following the arrest of Huawei Technologies executive Meng Wanzhou in Vancouver in December.
Since Meng’s arrest, China has detained two Canadians, Michael Kovrig and Michael Spavor. It also halted imports of Canadian canola in March due to concerns about pests, although the Canola Council of Canada has disputed this assertion.
Gordon Houlden, the director of the China Institute at the University of Alberta, said in an interview that while the Chinese government will not admit to it, Canada’s arrest of Meng has been a factor in the deteriorating relationship between the two countries.
“My bigger fear is that they are putting Canadian products through a very very fine screen the wouldn’t have been there otherwise if it hadn’t been for the Huawei issue,” Houlden said.
Carlo Dade, the director of trade and investment at the Canada West Foundation, said that while Canadian producers will certainly suffer a financial hit due to the latest decision, the good news is that China isn’t the No. 1 market for either industry.
“The bottom line is this is going to be a hit,” Carlos Dade said in an interview.
“But we do have options. The work that we’ve done with CETA (Canada’s free trade agreement with Europe), and the Trans Pacific Partnership are starting to pay dividends. We will survive this. But it is concerning.”
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Graphene 3D Lab Inc. (CVE:GGG) Insiders Increased Their Holdings
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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellGraphene 3D Lab Inc.(CVE:GGG), you may well want to know whether insiders have been buying or selling.
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We don't think shareholders should simply follow insider transactions. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
See our latest analysis for Graphene 3D Lab
In the last twelve months, the biggest single purchase by an insider was when President Daniel Stolyarov bought CA$120k worth of shares at a price of CA$0.06 per share. We do like to see buying, but this purchase was made at well below the current price of CA$0.075. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.
Over the last year, we can see that insiders have bought 2.2m shares worth CA$139k. But insiders sold 1.5m shares worth CA$129k. In the last twelve months there was more buying than selling by Graphene 3D Lab insiders. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Graphene 3D Lab 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 Graphene 3D Lab over the last quarter. Daniel Stolyarov bought US$8.3k worth of shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. But in this case the amount purchased means the recent transaction may not be very meaningful on its own.
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 19% of Graphene 3D Lab shares, worth about CA$1.1m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
We note a that there has been a bit of insider buying recently (but no selling). Overall the buying isn't worth writing home about. But insiders have shown more of an appetite for the stock, over the last year. Insiders own shares in Graphene 3D Lab and we see no evidence to suggest they are worried about the future. To put this in context, take a look at how a company has performed in the past. You can accessthisdetailed graphof past 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 interesting companies, that have HIGH return on equity and low debt.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading. |
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