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Is Ducommun Incorporated (NYSE:DCO) Trading At A 39% Discount?
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Today we will run through one way of estimating the intrinsic value of Ducommun Incorporated (NYSE:DCO) by taking the expected future cash flows and discounting them to their present value. I will be using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
View our latest analysis for Ducommun
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
Generally we assume that a dollar today is more valuable than a dollar in the future, so we need to discount the sum of these future cash flows to arrive at a present value estimate:
[{"": "Levered FCF ($, Millions)", "2020": "$44.6m", "2021": "$50.5m", "2022": "$55.5m", "2023": "$59.8m", "2024": "$63.6m", "2025": "$66.9m", "2026": "$69.9m", "2027": "$72.6m", "2028": "$75.2m", "2029": "$77.7m"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x4", "2021": "Est @ 13.05%", "2022": "Est @ 9.96%", "2023": "Est @ 7.79%", "2024": "Est @ 6.27%", "2025": "Est @ 5.21%", "2026": "Est @ 4.46%", "2027": "Est @ 3.94%", "2028": "Est @ 3.58%", "2029": "Est @ 3.33%"}, {"": "Present Value ($, Millions) Discounted @ 9.56%", "2020": "$40.7", "2021": "$42.0", "2022": "$42.2", "2023": "$41.5", "2024": "$40.3", "2025": "$38.7", "2026": "$36.9", "2027": "$35.0", "2028": "$33.1", "2029": "$31.2"}]
("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= $381.6m
We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (2.7%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 9.6%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$78m × (1 + 2.7%) ÷ (9.6% – 2.7%) = US$1.2b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$1.2b ÷ ( 1 + 9.6%)10= $469.64m
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $851.27m. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of $74.04. Compared to the current share price of $45.39, the company appears quite undervalued at a 39% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Ducommun as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 9.6%, which is based on a levered beta of 1.145. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Although the valuation of a company is important, it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price to differ from the intrinsic value? For Ducommun, I've put together three pertinent factors you should further examine:
1. Financial Health: Does DCO have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does DCO's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of DCO? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Buttigieg Proposes National-Service Program to Fight Climate Change, Addiction
Southbend, Ind. mayor Pete Buttigieg on Wednesday proposed the creation of new voluntary-service programs to combat climate change and increasing rates of mental-health issues, among other objectives. The plan, released by Buttigieg’s presidential campaign, calls for the recruitment of 250,000 young people in the coming years with a possible expansion to 1 million by 2026. It would expand programs such as AmeriCorps and the Peace Corps, while also creating new programs, to fight climate change, treat mental illness, and reduce rates of addiction. Buttigieg has emphasized the power of national service throughout his upstart bid for the Democratic nomination, returning often to his service as a Naval Reserve officer in Afghanistan during stump speeches and interviews. “At a moment when our social fabric is being torn apart, where people increasingly only hear voices that are like their own, it’s a really important time to build social capital through giving people opportunities to work in service in ways that are also going to deliver value to the country,” Buttigieg told the New York Times . “I also think you shouldn’t have to go to war to have that experience.” A spokeswoman for the campaign said the program would cost $20 billion over ten years. More from National Review Report: Trump Administration to Block California’s Fuel-Efficiency Standards Bernie Sanders: Government ‘Cannot Go Too Far’ in Addressing Climate Change Climate Scientists Discover Error in Major Ocean-Warming Study View comments
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Japan's Service Sector Gathers Steam: 3 Fund Picks
Japan was one of the most preferred places for investment in recent times. The Investment Association (IA) Japan fund sector has returned 76.7% on average over the past five years. Furthermore, the IA Japanese Smaller Companies sector turned up as one of the best performing, with an average return of more than 100% over the past years.
Japan has showcased resilience in times of global economic slowdown. Its first-quarter GDP nudged up, putting to rest speculation about an impending slowdown in the world’s third-largest economy. Further, unemployment rate is near a four-decade low. Such encouraging conditions call for investing in mutual funds with significant exposure to companies domiciled in Japan.
Japan’s Service PMI Hits a 3 Month High
Per the latest report, the Jibun Bank Japan Services Purchasing Managers’ Index (PMI), which measures the country’s service sector activity, increased to 51.9 in June from 51.7 in May. This marked its highest pace of growth in the past three months. A reading above 50 depicts that the index is expanding and has increased for the 33rd month on the trot.
Japan’s service sector has benefited immensely from domestic demands and has remained resilient to economic pressure from the country’s weakening export.
Further, the composite PMI, which includes both manufacturing and services sectors, increased to 50.8 in June from 50.7 in May.
Analysts believe that if such solid growth in the service sector is sustained in the months to come, the space could go a long way in boosting the country’s overall economic growth. As a matter of fact, economists believe that the country’s resilience to global economic downturns of 2019 implies that its GDP growth is likely to remain strong for the remaining part of this year.
3 Best Fund Choices
We have, thus, selected three Japan mutual funds carrying a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy) that are poised to gain from such factors. Moreover, these funds have encouraging three and five-year returns. Additionally, the minimum initial investment is within $5000.
We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but also on the likely future success of the fund.
The question here is: why should investors consider mutual funds? Reduced transaction costs and diversification of portfolio without several commission charges that are associated with stock purchases are primarily why one should be parking money in mutual funds (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).
ProFunds UltraJapan Fund InvestorUJPIX seeks daily investment results that correspond to twice the daily performance of Nikkei 225 Stock Exchange. The non-diversified fund invests in financial instruments that ProFund Advisors feel will produce daily returns consistent with the fund’s objective for investment.
This Sector - Japan - Equity product has a history of positive total returns for over 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
UJPIX has a Zacks Mutual Fund Rank#1 and an annual expense ratio of 1.66%, which is below the category average of 2.05%. The fund has three and five-year returns of 22.4% and 14%, respectively.
T. Rowe Price Japan FundPRJPX seeks capital appreciation over the long run by investing the majority of its assets in securities of companies based in Japan. PRJPX invests in various Japanese companies and industries, irrespective of their size.
This Sector - Japan - Equity product has a history of positive total returns for over 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
PRJPX has a Zacks Mutual Fund Rank #2 and an annual expense ratio of 0.95%, which is below the category average of 1.27%. The fund has three and five-year returns of 12.5% and 10.6%, respectively.
Matthews Japan Investor FundMJFOX aims to gain capital by investing the majority of its net assets in preferred and common stocks of companies located in Japan.
This Sector - Japan - Equity product has a history of positive total returns for over 10 years. To see how this fund performed compared in its category, and other 1 and 2 Ranked Mutual Funds, please click here.
MJFOX has a Zacks Mutual Fund Rank#2 and an annual expense ratio of 0.91%, which is below the category average of 1.27%. The fund has three and five-year returns of 7.2% and 9%, respectively.
Want key mutual fund info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing mutual funds, each week. Get it free >>
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 reportGet Your Free (UJPIX): Fund Analysis ReportGet Your Free (MJFOX): Fund Analysis ReportGet Your Free (PRJPX): Fund Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Read This Before You Buy Trinseo S.A. (NYSE:TSE) Because Of Its 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). To keep it practical, we'll show how Trinseo S.A.'s (NYSE:TSE) P/E ratio could help you assess the value on offer.What is Trinseo's P/E ratio?Well, based on the last twelve months it is 8.09. In other words, at today's prices, investors are paying $8.09 for every $1 in prior year profit.
Check out our latest analysis for Trinseo
Theformula for P/Eis:
Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Or for Trinseo:
P/E of 8.09 = $39.79 ÷ $4.92 (Based on the year to March 2019.)
A higher P/E ratio means that buyers have to paya higher pricefor each $1 the company has earned over the last year. That is not a good or a bad thingper se, but a high P/E does imply buyers are optimistic about the future.
P/E ratios primarily reflect market expectations around earnings growth rates. When earnings grow, the 'E' increases, over time. Therefore, even if you pay a high multiple of earnings now, that multiple will become lower in the future. And as that P/E ratio drops, the company will look cheap, unless its share price increases.
Trinseo shrunk earnings per share by 35% over the last year. But it has grown its earnings per share by 109% per year over the last five years.
We can get an indication of market expectations by looking at the P/E ratio. The image below shows that Trinseo has a lower P/E than the average (18.8) P/E for companies in the chemicals industry.
Its relatively low P/E ratio indicates that Trinseo shareholders think it will struggle to do as well as other companies in its industry classification. Many investors like to buy stocks when the market is pessimistic about their prospects. It is arguably worth checkingif insiders are buying shares, because that might imply they believe the stock is undervalued.
The 'Price' in P/E reflects the market capitalization of the company. That means it doesn't take debt or cash into account. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash).
Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof).
Trinseo's net debt equates to 40% of its market capitalization. You'd want to be aware of this fact, but it doesn't bother us.
Trinseo has a P/E of 8.1. That's below the average in the US market, which is 18.2. The debt levels are not a major concern, but the lack of EPS growth is likely weighing on sentiment.
Investors should be looking to buy stocks that the market is wrong about. 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. So thisfreevisual report on analyst forecastscould hold the key to an excellent investment decision.
But note:Trinseo may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20).
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Are Social Security Offices Closed for the Fourth of July?
Need to replace a lost Social Security card during the first week of July? If your plan is to head to your local Social Security field office to request a replacement card, check first to be sure it's open. Social Security offices close on federal holidays including the Fourth of July, which in 2019 falls on Thursday. In addition, some Social Security offices are closing a day or two ahead of Independence Day. QUIZ: True or False? Test Your Knowledge of Social Security Basics Use the Social Security Office Locator to find the location nearest you. In additional to holiday closures, you can also find information on office hours and office closings (either temporary or permanent). In general, Social Security field office hours are weekdays, 9 a.m. to 4 p.m. (except Wednesdays, when offices close at noon). Offices are closed on weekends. 2019 Federal Holidays for Social Security Offices New Year's Day Tuesday, January 1 Martin Luther King, Jr.'s Birthday Monday, January 21 Washington's Birthday Monday, February 18 Memorial Day Monday, May 27 Independence Day Thursday, July 4 Labor Day Monday, September 2 Columbus Day Monday, October 14 Veterans Day Monday, November 11 Thanksgiving Day Thursday, November 28 Christmas Day Wednesday, December 25 SEE ALSO: 13 States That Tax Social Security Benefits If you discover that your local Social Security field office is closed due to a holiday or for some other reason, many Social Security services are also available online or by telephone (call toll-free: 1-800-772-1213). To access most online services, from reviewing your earnings history to checking your application status, you'll need to set up a free My Social Security Account . EDITOR'S PICKS True or False? Test Your Knowledge of Social Security Basics Calculator: What\'s My Social Security Full Retirement Age? 13 States That Tax Social Security Benefits Copyright 2019 The Kiplinger Washington Editors
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Companies to Watch: Broadcom in talks with Symantec, Waymo gets big approval, American Air hit by Boeing
Here are the companies Yahoo Finance is watching today.
Broadcom(AVGO) is reportedly in advanced talks to buy struggling security software company Symantec (SYMC). Bloomberg reports there's no deal yet, and the purchase price hasn't been revealed. A memo to Broadcom investors said, “Symantec is fresh off a MAJOR earnings warning and the departure of its CEO in May.”
Google's(GOOG,GOOGL) autonomous driving platform Waymo has gotten the okay to carry passengers in California. It's a pilot program, and a driver has to be behind the wheel. However, it's another step forward for the tests. Three other companies are also piloting self-driving cars in the state.
The grounding of those 737 Max jets is now making it tougher to get from Dallas to Oakland.American Airlines(AAL) has canceled direct flights between the two cities, noting that it needs the planes it had been flying for other routes. American is the first airline to cancel a route because it can no longer fly the 737 max.
Samsungjust finished a new design of the Galaxy Fold. The tech giant completed the redesign of the folding phone after experiencing screen failures that forced its delay, according to Bloomberg. There’s no word yet on when the smartphone will be up for sale, but the company is now in the final stages of producing it.
Sony's(SNE) “Spider-Man: Far From Home” swings into theaters nationwide today. Analysts’ spidey-senses say it could make $125 million domestically in the first six days. The last Spider-Man film, “Spider-Man: Homecoming” came out July 7, 2017 and made $117 million in its opening weekend domestically.
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UK regulator investigates role of Facebook, Google in ad market
LONDON, July 3 (Reuters) - Britain's competition regulator has launched an investigation into the power wielded by Facebook and Google in digital advertising markets, including the ownership of data.
The Competition and Markets Authority said it would look at how much influence the platforms had, the way they collected and used personal data and whether consumers were getting a good deal.
Britain last year hired Jason Furman, chief economist in former U.S. President Barack Obama's administration, to chair a new panel that reviewed the country's approach to digital technology, finding that tech giants needed more competition.
The CMA said if it finds evidence that there are problems, it could make detailed recommendations to government.
"Much about these fast-changing markets is a closed book to most people," CMA Chairman Andrew Tyrie said. "The work we do will open them up to greater scrutiny, and should give Parliament and the public a better grip on what global online platforms are doing.
"These are global markets, so we should and will work more closely than before with authorities around the world, as we all consider new approaches to the challenges posed by them."
(Reporting by Kate Holton, Editing by Paul Sandle)
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What Should We Expect From Quixant Plc's (LON:QXT) Earnings In The Year Ahead?
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After Quixant Plc's (LON:QXT) earnings announcement in December 2018, it seems that analyst forecasts are fairly optimistic, with profits predicted to increase by 25% next year against the past 5-year average growth rate of 22%. Currently with trailing-twelve-month earnings of US$14m, we can expect this to reach US$18m 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 Quixant
The longer term expectations from the 4 analysts of QXT is tilted towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To understand the overall trajectory of QXT'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.
From the current net income level of US$14m and the final forecast of US$20m by 2022, the annual rate of growth for QXT’s earnings is 11%. This leads to an EPS of $0.30 in the final year of projections relative to the current EPS of $0.21. Margins are currently sitting at 12%, which is expected to expand to 14% by 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Quixant, there are three essential 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 Quixant 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 Quixant is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of Quixant? 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.
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Ripple’s Xpring invests $500 million in more than 20 companies
A year ago, Ripple’s ecosystem initiative Xpring has set out to build “the Internet of Value” and foster XPR adoption across the ecosystem. Since conception, Xpring has contributed $500 million in more than 20 companies. The platform has attracted both small and big projects. Among notable investments, it provided $100 million to a gaming platform Forte . However, its investment ranged across many different areas besides gaming; it contributed to a U.S. securities project Securitize , payment project Bolt Labs , or a crypto 'scout fund' Robot Ventures . Ripple hopes to spread adoption of its blockchain infrastructure—XRP Ledger and Interledger projects—and to popularise its cryptocurrency by enabling the creation of “real use cases for XRP.” Xpring has designed a developer platform with resources like tools, libraries and services for developers. In the future, Xpring team is planning to focus on the further development of XRP Ledger, blockchain interoperability, and decentralised finance. “We believe a tech stack for crypto that is broadly interoperable across chains and layers will deliver the best experience for both developers and end users. We support the Interledger Protocol as a standard for transacting across systems, and are interested in other infrastructures that allow for cross-chain interaction.”
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5 U.S. ETFs Seeing Fireworks Ahead of July Fourth
The year so far has been a good one for the U.S. stock market amid bouts of woes and uncertainties. This is especially true as Wall Street logged in the strongest performance in decades in the first half of the year. The S&P 500 jumped 17% — its best first-half performance since 1997 — while the Dow climbed 14%, its best show since 1999. Meanwhile, the Nasdaq Composite Index skyrocketed more than 20%, recording its best first six months of the year since 2003 (read: S&P 500 Hits New High: 10 Top-Performing ETFs YTD).Though trade war jitters, global growth concerns, recession fears, government shutdown, geopolitical tension and weak corporate earnings weighed on stocks, the rally was powered by hopes of easing money policies. The Fed signaled rate cuts in the near term that led to renewed confidence in the slowing economy. Lower interest rates will keep borrowing cost down, thereby resulting in higher consumer spending and rise in economic activities. Additionally, recovery in U.S. housing market, rising oil price and the wave of mergers & acquisitions added to the strength.While there are winners in many corners of the space, a few have easily crushed the Wall Street returns. In fact, they have generated more than double the returns of the S&P 500. We have highlighted them that skyrocketed more than 30% in the year-to-date timeframe (read: Top ETF Stories of 1H).These funds focus exclusively on U.S. equities and deserve the attention of investors seeking a domestic tilt to their portfolio ahead of the Jul 4 holiday.ARK Genomic Revolution Multi-Sector ETF ARKGThe biotech sector has been on the mend amid ongoing industry consolidation and attractive valuations. Particularly, the surge in demand for artificial intelligence for the advancement of diagnoses and treatment across the health care spectrum has been driving this ETF. This is an actively managed ETF, focusing on companies likely to benefit from the extension and enhancement of the quality of human and other life by incorporating technological and scientific developments plus improvements and advancements in genomics into their business. With AUM of $448.4 million, the fund holds 37 stocks in its basket and has 0.75% in expense ratio. It trades in average daily volume of 149,000 shares and has soared 42% this year so far (read: 5 Sector ETFs That Beat the Market in the First Half).Invesco WilderHill Clean Energy ETF PBWThis product has been powered by a solar surge. It provides exposure to U.S. companies engaged in the business of advancement of cleaner energy and conservation. It follows the WilderHill Clean Energy Index and holds about 38 stocks in its basket with none holding more than 3.12% of the total assets. The fund has AUM of $175 million in its asset base and sees a good volume of nearly 37,000 shares a day. It charges 70 bps in annual fees and has gained 41.7% so far this year.Invesco DWA Technology Momentum ETF PTFThe technology sector has been the biggest beneficiary of the broad market rally, attributable to the anticipation of a trade deal and the Fed’s more dovish-than-expected view. In fact, PTF, which provides exposure to the companies with relative strength (momentum), has been leading the pack. It follows the Dorsey Wright Technology Technical Leaders Index and holds 39 securities in its basket. This ETF is illiquid and relatively unpopular with AUM of $213.4 million and average daily volume of 23,000 shares. It charges 60 bps in annual fees and has rallied 41.2%. The product has a Zacks ETF Rank #2 (Buy) with a High risk outlook (read: S&P 500 Hits New High to Start 2H: Top-Ranked ETFs to Buy).Renaissance IPO ETF IPOThis ETF has been surging on a slew of blockbuster IPOs. This fund provides exposure to the largest and most-liquid newly listed companies by tracking the Renaissance IPO Index. It currently holds 64 stocks in its basket, with each accounting for less than 9.5% exposure. Technology is the top sector accounting for 36% share while communication services and real estate round off the next two spots with double-digit allocation each. The fund has amassed $52.2 million in its asset base while trading in light volume of about 36,000 shares, probably implying additional cost beyond the expense ratio of 0.60%. IPO is up 37.1% so far this year.Invesco DWA NASDAQ Momentum ETF DWAQIn an uptrend market, momentum ETFs perform well compared to others. DWAQ offers exposure to 100 large-cap companies that are showing relative strength (momentum). Healthcare is the top sector accounting for more than one-third share, closely followed by information technology with 29.7% share. The product has accumulated $47.7 million in its asset base and has expense ratio of 0.60%. It trades in average daily volume of 2,000 shares and has gained 35.4% in the year-to-date timeframe.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
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 reportRenaissance IPO ETF (IPO): ETF Research ReportsInvesco WilderHill Clean Energy ETF (PBW): ETF Research ReportsInvesco DWA Technology Momentum ETF (PTF): ETF Research ReportsInvesco DWA NASDAQ Momentum ETF (DWAQ): ETF Research ReportsARK Genomic Revolution ETF (ARKG): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWant the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
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The best and worst sugar substitutes for your health
coca-cola-sugar-substitutes Wandering through the grocery store, it is easy to be overwhelmed by the numerous brands and health claims on the dozens of sugar substitutes. It can be particularly confusing for those with diabetes or pre-diabetes who must keep their blood sugar in check and control their weight. With the growing diabetes and obesity epidemic , there has been increasing awareness around the use of added sugars in foods. The most recent edition of the US Dietary Guidelines for Americans recommends that added sugars should be kept to less than 10% of the calories consumed, which turns out to be roughly 270 calories per day. Jeffrey Epstein’s fortune is built on fraud, a former mentor says This is because “added sugars” add sweetness or flavor but add very little nutritional value. Because of this trend, the food industry has embarked on a quest to find or develop the perfect substitute to replace sugar—with the same taste and none of the calories that lead to weight gain. As a pharmacist who is also board certified in advanced diabetes management, I talk to patients every day about blood sugars and ways to help them take control of their diabetes. They often ask me whether the perfect substitute to sugar has been found. The short answer is no. Here is the long answer. Sugar alcohols The simplest way to improve your credit score is by using your email Sugar substitutes can be categorized into two main groups: sugar alcohols and high intensity sweeteners. The sugar alcohols include sorbitol, xylitol, lactitol, mannitol, erythritol, and maltitol. High-intensity sweeteners include saccharin, aspartame, acesulfame potassium (Ace-K), sucralose, neotame, advantame, stevia, and Siraitia grosvenorii Swingle fruit extract (SGFE). Sugar alcohols are often found in toothpaste, chewing gum, and some “sugar-free” foods. They are carbohydrates with a chemical structure that resembles sugar, but also the components that make them an alcohol. They are about 25-100% sweeter than sugar and have a similar taste . But here is the catch: They are not calorie free. Most have between 1.5 and two calories per gram . Now compare the calorie count to sugar, also known as sucrose, which has four calories per gram—twice as much. Story continues Although sugar alcohols contain fewer calories, they will still increase a patient’s blood sugar, especially when eaten in excess. When compared to sugar, the effect is less dramatic though. This is because of how these molecules are processed in the body. We measure this using the glycemic index. The glycemic index is a reference to how quickly a food is broken down and absorbed. The higher the number, the more quickly the food breaks down and the faster the sugar goes into the blood. Sucrose has a glycemic index of 65; whereas sugar alcohols, like xylitol, have a glycemic index of around seven. This means that sugar alcohols are harder to digest, and cause a slower and lower increase in post-meal blood sugars—which is typically better for people with diabetes. Because sugar alcohols are harder for the body to break down though, some of them remain in the gut, and if a person consumes too much they may experience digestive complaints like gas, cramping, and diarrhea. Here is the other downside to foods containing sugar alcohols: They often have higher quantities of fat or salt to make up for the lower sugar content. Artificial sweeteners High-intensity sweeteners are zero- or low-calorie alternatives to sugar. They are made from a variety of sources, and are 100 to 20,000 times as sweet as sugar. Some leave a bitter or metallic taste behind. Two newer substitutes—stevia and SGFE—come from plants and are at times referred to as “natural” substitutes. According to the American Diabetes Association 2019 guidelines , the use of high-intensity sweeteners may decrease calorie and carbohydrate intake. However, you cannot replace these “free” calories with calories from other food source, or you will lose or the benefits on blood sugar control and weight loss. Researchers have seen this in some of the studies on high-intensity sweeteners. Some of the trials show no difference or even a possible increase in weight . But in other studies where intake of food is better regulated and patients don’t replace these free calories with other high-caloric foods, the weight loss is maintained . The takeaway All sugar substitutes are labeled as food additives and are under the regulation of the US Food and Drug Administration. The latest trend has been labeling some of the sugar substitutes as “derived from plants” or “natural.” That does not necessarily mean that these are safer or more effective in blood sugar control or weight loss. If it is used in excess, side effects such as bloating or diarrhea may still result. Several concerns by researchers have been raised about high-intensity sweeteners—saccharin and aspartame—and cancer. To date, the National Cancer Institute has concluded that there is no clear evidence that any of the high-intensity sweeteners is associated with an increased risk of cancer . As a pharmacist specializing in advanced diabetes, I talk to patients every day about how to control their blood sugar level and their diabetes. There are three main ways to do that: medication, increased activity, and diet. The last two are probably more important in the long run. If diet and activity level never change, it is really hard to help patients bring their blood sugars down. Medication after medication will likely have to be added. With this comes the potential for side effects. So if I can persuade patients to make changes to their diet, like switching to a beverage with a sugar substitute, it makes a huge difference in helping to control blood sugars and the dose of medications. The overall focus for diabetes management should be on reducing the consumption of sugar-sweetened beverages and foods. If you can switch one of these sugar-sweetened products to a food that has a high-intensity sugar substitute, that is better. But best of all is consuming food and drinks that are not highly processed and do not have added sugars. This article is republished from The Conversation under a Creative Commons license. Read the original article . Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: The glow of the historic accord between Ethiopia and Eritrea has faded Zimbabwe banned the US dollar from being used so local bitcoin demand is soaring again
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Should We Be Delighted With Tyson Foods, Inc.'s (NYSE:TSN) ROE Of 15%?
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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 Tyson Foods, Inc. (NYSE:TSN).
Our data showsTyson Foods has a return on equity of 15%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 $0.15.
See our latest analysis for Tyson Foods
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Tyson Foods:
15% = US$2.1b ÷ US$14b (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 profit over the last twelve months. 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. Clearly, then, one can use ROE to compare different companies.
One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, Tyson Foods has a higher ROE than the average (9.8%) in the Food industry.
That's clearly a positive. We think a high ROE, alone, is usually enough to justify further research into a company. For exampleyou might checkif insiders are buying shares.
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.
Although Tyson Foods does use debt, its debt to equity ratio of 0.91 is still low. The combination of modest debt and a very respectable ROE suggests this is a business worth watching. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities.
Return on equity is useful for comparing the quality of different businesses. 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.
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 check this FREEvisualization of analyst forecasts for the company.
Of courseTyson Foods may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Why Shares of Omnova Solutions Are Surging on Wednesday
Shares ofOmnova Solutions(NYSE: OMN)traded up more than 55% on Wednesday morning after the specialty materials company said it has agreed to be acquired by U.K.-based Synthomer in a deal valued at $455.2 million. The deal news overshadowed quarterly results that came in below expectations and reversed what had been a downward trend for Omnova shares.
Before markets opened on Wednesday, Omnova said it has agreed to be acquired by Synthomer for $10.15 per share in cash, a premium of 58% to Tuesday's closing price of $6.42. Company CEO Anne Noonan in a statement said, "this transaction presents increased opportunities for the business and its employees to leverage the combined scale, grow more quickly and profitably, and enhance product innovation in ways that will benefit customers and employees."
Image source: Getty Images.
Prior to the deal, Omnova shares had been floundering, down more than 20% year to date due to concerns over a global industrial slowdown. The company's fiscal second-quarter results highlight the reason for concern. Omnova reported adjusted earnings of $0.12 per share on revenue of $205.7 million, missing consensus estimates for $0.21 per share in earnings on revenue of $216 million.
Omnova has been in the process of revamping its business, exiting the commodity coated paper market and streamlining operations.
The deal is not contingent on Synthomer securing financing, and it should close late in 2019 or early in 2020 once it is cleared by regulators and Omnova shareholders. Given the premium to current prices and the fact that the $10.15 buyout price is higher than where Omnova shares have traded for most of the company's history, I would expect shareholders to sign off on the transaction.
Given the continued uncertainty about the global economy and the large,recently streamlinedcompetitors an independent Omnova has to worry about, the deal looks like a good outcome for all involved.
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Lou Whitemanhas no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has adisclosure policy.
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What Does Titan Pharmaceuticals, Inc.'s (NASDAQ:TTNP) Balance Sheet Tell Us About It?
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Titan Pharmaceuticals, Inc. (NASDAQ:TTNP) is a small-cap stock with a market capitalization of US$17m. While investors primarily focus on the growth potential and competitive landscape of the small-cap companies, they end up ignoring a key aspect, which could be the biggest threat to its existence: its financial health. Why is it important? Since TTNP is loss-making right now, it’s crucial to evaluate the current state of its operations and pathway to profitability. The following basic checks can help you get a picture of the company's balance sheet strength. However, potential investors would need to take a closer look, and I suggest youdig deeper yourself into TTNP here.
Over the past year, TTNP has ramped up its debt from US$3.4m to US$5.1m , which includes long-term debt. With this growth in debt, the current cash and short-term investment levels stands at US$5.9m , ready to be used for running the business. We note it produced negative cash flow over the last twelve months. As the purpose of this article is a high-level overview, I won’t be looking at this today, but you can take a look at some of TTNP’soperating efficiency ratios such as ROA here.
At the current liabilities level of US$4.8m, it seems that the business has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.12x. The current ratio is calculated by dividing current assets by current liabilities. Generally, for Pharmaceuticals companies, this is a reasonable ratio as there's enough of a cash buffer without holding too much capital in low return investments.
Since total debt levels exceed equity, TTNP is a highly leveraged company. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. However, since TTNP is presently unprofitable, sustainability of its current state of operations becomes a concern. Maintaining a high level of debt, while revenues are still below costs, can be dangerous as liquidity tends to dry up in unexpected downturns.
TTNP’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. Keep in mind I haven't considered other factors such as how TTNP has been performing in the past. You should continue to research Titan Pharmaceuticals to get a better picture of the small-cap by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for TTNP’s future growth? Take a look at ourfree research report of analyst consensusfor TTNP’s outlook.
2. Historical Performance: What has TTNP's returns been like over the past? Go into more detail in the past track record analysis and take a look atthe free visual representations of our analysisfor more clarity.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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The Three Rules Volley Back and Forth
This article was originally published onETFTrends.com.
ByRiverFront Investment Management
Summer is now in full swing with Wimbledon under way, and the S&P 500 is attempting to set itsthirdrecord high within the last three months to align with tennis’thirdgrand slam of the year. Some of the marquee players who have combined to win multiple Wimbledon titles will face formidable challenges from young up and comers in addition to the physical and mental toll that comes along with the process. Global equity markets are in a similar predicament. Challenges are found in the form of trade tensions between the US and China, slowing earnings growth, and the central bank policy of the Federal Reserve.
Last weekend’s meeting between Presidents Trump and Xi at the G-20 meeting in Osaka, Japan should help to ease some of the pressure on the trade front, as the two countries agreed to restart negotiations after several months of acrimonious rhetoric. From an earnings and central bank policy perspective, we will have to be spectators for a while longer as Q2 reporting season does not get into full swing until mid-month and the Fed will not make its next rate decision until July 31 st . The early odds are favoring weaker Q2 earnings and a near-certain probability of a cut in the fed funds interest rate target. Given this backdrop, RiverFront’s three tactical rules of Don’t Fight the Fed, Don’t Fight the Trend, and Beware of the Crowd at Extremes have changed since our last update. Below you will find a summary chart highlighting changes in the three rules since ourApril 29th,Weekly View:
DON’T FIGHT THE FED: We believe investors should not go against the policy guidance of central bankers in the US or abroad.
The current policy stance of the Fed is supportive of a continuation of the ten-year economic expansion and is bullish for risk assets as financial conditions have eased since the beginning of the year. According to the Chicago Fed’s National Financial Conditions Index, financial conditions are close to the loosest they have ever been; indicating a willingness for financial institutions to lend to borrowers. The Fed and global central banks have become dovish as inflation has failed to hit their 2% target despite relatively strong labor markets. Central bankers have once again started to use monetary measures to stimulate their economies. In the US, the Fed recognizes the strength of bank balance sheets and has allowed banks to reduce the levels of reserves on hand, freeing up excess capital that can be lent to businesses and consumers. This can be seen in the chart (right) of combined central bank balance sheets. We believe the Fed is currently supportive and on the investor’s side.
Internationally, the rate of change differs across the board regarding policy decisions. For instance, in Europe we view the ECB as supportive after Mario Draghi committed to restarting its Asset Purchase Program (APP) if necessary. The BOJ on the other hand committed to additional easing but was light on details so we continue to rate it as neutral/positive as we await further stimulus. In China, the PBoC is providing its own version of quantitative easing and we view the central bank guidance as supportive.
DON’T FIGHT THE TREND: We believe investors should determine the direction and strength of the trend and make investment decisions accordingly.
Currently the US primary trend, which we define as the S&P 500’s 200 day moving average remains flat. While the S&P 500 set new highs in April and June, each subsequent high has been harder to attain and less impressive than the previous. Consider for a moment, since the September 2018 high of 2940, the mark has been broken twice by an unimpressive 15 points. It has now been nine months and after the volleying back and forth (volatility) the S&P has gone virtually nowhere; hence the flat trend.
BEWARE OF THE CROWD AT EXTREMES:
We believe investors should analyze sentiment to determine if it is sustainable at current levels. If sentiment is identified to be unsustainable, then as investors we should be willing to lean in the other direction and be prepared to act aggressively once the condition changes.
Ned Davis Research’s (NDR) Weekly Crowd Sentiment Poll is at the upper end of neutral after reaching extreme optimism in late April and then falling into extreme pessimism in late May. The drop in May to extreme pessimism came as trade negotiations fell apart with China. The subsequent rebound in sentiment from the May lows was driven by the Fed becoming more dovish and acknowledging its willingness to cut interest rates if needed. This change in investor sentiment has allowed the S&P to rally from the bottom of the 2700 to 2955 trading range. Sentiment, in our view, will be primarily driven by the Federal Reserve’s monetary policy decisions, the trajectory of global trade tensions, and global political climate. The circles in the chart below show how extremes in investor sentiment (pessimism and optimism) have coincided with market peaks and troughs.
Past performance is no guarantee of future results. © 2019 Ned Davis Research Inc. Further distribution prohibited without prior permission. All Rights Reserved. See NDR Disclaimer atwww.ndr.com/copyright.html. For data disclaimers refer to www.ndr.com/vendorinfo/.
THE FINAL VERDICT:
The Fed signaling a probable rate cut and the recent de-escalation of US/China trade tensions has created a positive backdrop for equity performance. With central banks on the investor’s side, a flat trend, and neutral sentiment, our three signals suggest optimism for stocks in the near term. If the conditions for the trend and the crowd improve from here, we will look to increase our exposure to equities across all portfolios. However, if conditions deteriorate from here, we would maintain our risk neutral stance in the shorter time horizon portfolios and our slight equity overweight in the longer time horizon portfolios.
Important Disclosure Information
The comments above refer generally to financial markets and not RiverFront portfolios or any related performance. Past results are no guarantee of future results and no representation is made that a client will or is likely to achieve positive returns, avoid losses, or experience returns similar to those shown or experienced in the past.
Information or data shown or used in this material is for illustrative purposes only and was received from sources believed to be reliable, but accuracy is not guaranteed.
In a rising interest rate environment, the value of fixed-income securities generally declines.
It is not possible to invest directly in an index.
When referring to being “overweight” or “underweight” relative to a market or asset class, RiverFront is referring to our current portfolios’ weightings compared with the 2016 strategic allocations for each portfolio, as opposed to compared with the portfolios’ composite benchmarks.
Technical analysis is based on the study of historical price movements and past trend patterns. There are no assurances that movements or trends can or will be duplicated in the future.
Small-, mid- and micro-cap companies may be hindered as a result of limited resources or less diverse products or services and have therefore historically been more volatile than the stocks of larger, more established companies.
Investing in foreign companies poses additional risks since political and economic events unique to a country or region may affect those markets and their issuers. In addition to such general international risks, the portfolio may also be exposed to currency fluctuation risks and emerging markets risks as described further below.
Changes in the value of foreign currencies compared to the U.S. dollar may affect (positively or negatively) the value of the portfolio’s investments. Such currency movements may occur separately from, and/or in response to, events that do not otherwise affect the value of the security in the issuer’s home country. Also, the value of the portfolio may be influenced by currency exchange control regulations. The currencies of emerging market countries may experience significant declines against the U.S. dollar, and devaluation may occur subsequent to investments in these currencies by the portfolio.
Foreign investments, especially investments in emerging markets, can be riskier and more volatile than investments in the U.S. and are considered speculative and subject to heightened risks in addition to the general risks of investing in non-U.S. securities. Also, inflation and rapid fluctuations in inflation rates have had, and may continue to have, negative effects on the economies and securities markets of certain emerging market countries.
Stocks represent partial ownership of a corporation. If the corporation does well, its value increases, and investors share in the appreciation. However, if it goes bankrupt, or performs poorly, investors can lose their entire initial investment (i.e., the stock price can go to zero). Bonds represent a loan made by an investor to a corporation or government. As such, the investor gets a guaranteed interest rate for a specific period of time and expects to get their original investment back at the end of that time period, along with the interest earned. Investment risk is repayment of the principal (amount invested). In the event of a bankruptcy or other corporate disruption, bonds are senior to stocks. Investors should be aware of these differences prior to investing.
Standard & Poor’s (S&P) 500 Index measures the performance of 500 large cap stocks, which together represent about 80% of the total US equities market.
MSCI ACWI ex USA Index captures large and mid cap representation across 22 of 23 developed markets (DM) countries (excluding the US) and 23 emerging markets (EM) countries.
RiverFront Investment Group, LLC, is an investment adviser registered with the Securities Exchange Commission under the Investment Advisers Act of 1940. The company manages a variety of portfolios utilizing stocks, bonds, and exchange-traded funds (ETFs). RiverFront also serves as sub-advisor to a series of mutual funds and ETFs. Opinions expressed are current as of the date shown and are subject to change. They are not intended as investment recommendations.
RiverFront is owned primarily by its employees through RiverFront Investment Holding Group, LLC, the holding company for RiverFront. Baird Financial Corporation (BFC) is a minority owner of RiverFront Investment Holding Group, LLC and therefore an indirect owner of RiverFront. BFC is the parent company of Robert W. Baird & Co. Incorporated (“Baird”), a registered broker/dealer and investment adviser.
Copyright ©2019 RiverFront Investment Group. All Rights Reserved. 888545
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Why American National Insurance Company (NASDAQ:ANAT) Is A Top Dividend Stock
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Dividend paying stocks like American National Insurance Company (NASDAQ:ANAT) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. If you are hoping to live on the income from dividends, it's important to be a lot more stringent with your investments than the average punter.
While American National Insurance's 2.8% dividend yield is not the highest, we think its lengthy payment history is quite interesting. There are a few simple ways to reduce the risks of buying American National Insurance for its dividend, and we'll go through these below.
Explore this interactive chart for our latest analysis on American National Insurance!
Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. Looking at the data, we can see that 22% of American National Insurance's profits were paid out as dividends in the last 12 months. Given the low payout ratio, it is hard to envision the dividend coming under threat, barring a catastrophe.
Remember, you can always get a snapshot of American National Insurance's latest financial position,by checking our visualisation of its financial health.
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. For the purpose of this article, we only scrutinise the last decade of American National Insurance's dividend payments. During the past ten-year period, the first annual payment was US$3.08 in 2009, compared to US$3.28 last year. Dividend payments have grown at less than 1% a year over this period.
Dividends have grown relatively slowly, which is not great, but some investors may value the relative consistency of the dividend.
Examining whether the dividend is affordable and stable is important. However, it's also important to assess if earnings per share (EPS) are growing. Over the long term, dividends need to grow at or above the rate of inflation, in order to maintain the recipient's purchasing power. Earnings have grown at around 8.3% a year for the past five years, which is better than seeing them shrink! With a decent amount of growth and a low payout ratio, we think this bodes well for American National Insurance's prospects of growing its dividend payments in the future.
To summarise, shareholders should always check that American National Insurance's dividends are affordable, that its dividend payments are relatively stable, and that it has decent prospects for growing its earnings and dividend. We're glad to see American National Insurance has a low payout ratio, as this suggests earnings are being reinvested in the business. We like that it has been delivering solid improvement in its earnings per share, and relatively consistent dividend payments. Overall, we think there are a lot of positives to American National Insurance from a dividend perspective.
Are management backing themselves to deliver performance? Check their shareholdings in American National Insurance inour latest insider ownership analysis.
Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Mexico ETF Still Waiting For Tensions to Ebb
This article was originally published onETFTrends.com.
TheiShares MSCI Mexico Capped ETF (EWW) is up about 2.20% over the past month after the U.S. recently decided to not levy tariffs against one of its largest trading partners. Many previously feared that the escalation in the trade war with our southern neighbor would drag on growth and even send Mexico’s economy into a recession.
“A last-minute deal on Friday, June 7th prevented the US from imposing tariffs on all Mexican exports to the US worth ~$350 billion,” said BlackRockin a recent note. “In exchange for removing the tariffs Mexico agreed to increase enforcement to stop illegal migration and to expand the 'Remain in Mexico' plan for asylum seekers.”
Last month, President Trump took to Twitter to say that if Mexico agreed to up purchases of agriculture commodities from U.S. farmers, the tariffs could be averted. Trump originally floated the idea of tariffs on Mexico if the country did not step up to help with the immigration crisis.
Mexico is the United States’ third largest trading partner and is the second largest exporter of electronics to the United States. The U.S. is the largest export partner for Mexico, consuming about 80% of Mexican-made goods.
A Closer Look at EWW
“The measures taken by Mexico will be evaluated in mid-July. Terms of additional provisions will be finalized in 90 days from the deal,” said BlackRock.
EWW seeks to track the investment results of the MSCI Mexico IMI 25/50 Index, which is a free float-adjusted market capitalization-weighted index with a capping methodology applied to issuer weights so that no single issuer of a component exceeds 25% of the underlying index weight, and all issuers with a weight above 5% do not cumulatively exceed 50% of the underlying index weight.
“While Trump has bipartisan support for the China trade negotiations that was not the case with the tariffs threatened on Mexico, whereby Trump threatened to implement an economic lever in response to an unrelated foreign policy goal,” according to BlackRock.
Investors have pulled $272.27 million from EWW this year.
For more information on the Mexican markets, visit ourMexico category.
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Fiat Chrysler Canada's auto sales fall 4% in June
July 2 (Reuters) - Fiat Chrysler Automobiles NV, on Wednesday reported a 4% fall in total June auto sales in Canada.
The company, which is one of the top carmakers in the country, sold 21,566 vehicles in June, with its Chrysler brand reporting a 30% fall in sales.
Sales in the United States, however, rose nearly 2% to 206,083, driven by a 56% jump in Ram sales. (Reporting by Shanti S Nair in Bengaluru; Editing by Shailesh Kuber)
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What Are Analysts Saying About Take-Two Interactive Software, Inc.'s (NASDAQ:TTWO) Future?
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In March 2019, Take-Two Interactive Software, Inc. (NASDAQ:TTWO) released its earnings update. Generally, analysts seem cautiously bearish, with earnings expected to grow by 20% in the upcoming year against the higher past 5-year average growth rate of 23%. By 2020, we can expect Take-Two Interactive Software’s bottom line to reach US$400m, a jump from the current trailing-twelve-month of US$334m. I will provide a brief commentary around the figures and analyst expectations in the near term. Investors wanting to learn more about other aspects of the company shouldresearch its fundamentals here.
View our latest analysis for Take-Two Interactive Software
The longer term expectations from the 22 analysts of TTWO 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 get an idea of the overall earnings growth trend for TTWO, I’ve plotted out each year’s earnings expectations and inserted a line of best fit to determine an annual rate of growth from the slope of this line.
By 2022, TTWO's earnings should reach US$422m, from current levels of US$334m, resulting in an annual growth rate of 5.0%. EPS reaches $3.98 in the final year of forecast compared to the current $2.95 EPS today. This high rate of growth of revenue squeezes margins, as analysts predict an upcoming margin contraction from the current 13% to 12% by the end of 2022.
Future outlook is only one aspect when you're building an investment case for a stock. For Take-Two Interactive Software, I've put together three key 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 Take-Two Interactive Software 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 Take-Two Interactive Software is currently mispriced by the market.
3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of Take-Two Interactive Software? 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.
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Is Now the Right Time to Refinance Your Auto Loan?
Refinancing an auto loan can save you a ton of money. But only if you do it when the time is right.
Image credit: Getty Images
Refinancing your car loan can save you money if you do it at the right time. But refinancing at the wrong time could cost you. And in some cases, you may struggle to find lenders that are willing to work with you.
Here's what you need to know to decide if refinancing is the right decision for you.
There are two reasons to refinance your auto loan:
1. To pay less money overall. In this case, you'll be on the hunt for lower interest rates. You may also want a shorter loan term because you'll pay less in interest.
2. To lower your monthly payments. A lower interest rate helps, and so does extending the loan term. But if you extend the loan term, you'll probably pay more overall.
If you know your reason for refinancing, you’ll know what to look for in a loan. You’ll also understand your decision’s short- and long-term impacts.
Keep an eye on loaninterest ratesand look at rates from a few different banks to see which one offers the best deal. If they drop below the interest rate on your current loan, consider refinancing. It could save you more than you think.
Say you have a $20,000 car loan with a 60-month term and a 5% interest rate. Your monthly payments are $377 and you'll pay $22,645 overall.
If you refinance after a year with a 48-month loan at a 4% interest rate, your monthly payment would drop to $339 and you'd only pay $20,796 overall. That's a difference of $38 per month and $1,859 over five years.
You may also qualify for lower interest rates if yourcredit scorehas improved since you applied for your initial loan.
If you want a longer loan term, refinancing may also make sense. But understand that you'll probably pay more overall if you do this.
Want a shorter term? You may not need to refinance. Just pay extra each month to pay your loan off faster. Make sure your loan doesn't have a prepayment penalty, though. If it does, you may be better off refinancing for a shorter loan term to avoid penalized for extra payments.
If rates have risen considerably since you took out your initial car loan or your credit rating has taken a dive, refinancing your auto loan could hurt you instead of helping you.
You may struggle to find lenders that are willing to work with you if you've made severallate paymentsor if your car is worth less than your loan. If you find a lender willing to work with you, they'll probably charge you a higher interest rate. The loan is riskier now because the lender will lose if you default. Even selling the car won't cover the outstanding amount.
This is a common scenario for people who refinance relatively new cars. New vehicles begin depreciating rapidly the moment you drive them off the lot. They canlose more than 20% of their value in the first yearand an additional 10% of their value over each of the next four years. In our previous example, after one year, your $20,000 car may only be worth $16,000. But you still owe $16,389 on it.
That’s called being upside down on your loan, and it’s a bad situation.
Ideally, you won't need to refinance your car loan that soon. If you’re concerned about your ability to make your monthly payments, you're better off buying a cheaper car.
But if something unexpected happens and you need to refinance a relatively new car, check to make sure your loan's not upside down. If it is, try to pay the difference between your loan balance and the car's value before you refinance.
Refinancing old cars can be just as challenging as refinancing new cars. Some lenders set limits on how old a car can be or how many miles it can have. If yours exceeds these limits, the lender won't work with you. In that case, you may have to shop around or stick with your original loan.
Refinancing your auto loan requires careful consideration. You have to understand how your decision will impact your finances today and in the future. You also need to be aware of how you and your vehicle look to lenders, as this determines whether lenders are interested in working with you and the rates you can get.
Don't make the decision hastily. Think through the factors above before deciding whether refinancing is the right move for you.
The Motley Fool owns and recommends MasterCard and Visa, and recommends American Express. We’re firm believers in the Golden Rule. If we wouldn’t recommend an offer to a close family member, we wouldn’t recommend it on The Ascent either. Our number one goal is helping people find the best offers to improve their finances. That is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
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5 Real Estate Stocks to Buy for Dividend Income
Editor’s note: This story was previously published in May 2019. It has since been updated and republished.
Real estate stocks have become a popular income investment vehicle. Most operate as real estate investment trusts (REITs). These REITs are supposed to pay at least 90% of theirincome in the form of dividends. In exchange, REIT do not have to pay income tax on the net income generated from their properties.
For this reason, REITs tend to pay higher dividends than most stocks. The averageS&P 500stock now generates a dividend yield of 1.9%. The average equity (meaning non-mortgage) REIT currently yields an average 3.9% return.
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However, some pay a much higher dividend and can sustain that payout for several years. This occurs even as lifestyle changes and technology affect the demand for and use of properties. In our dynamic economy, these five real estate stocks have maintained strong, steady dividends amid the changes, Consequently, I believe they are good stocks to buy
At first glance,Kite Realty(NYSE:KRG) may seem like a strange name to include on a list of real estate stocks to buy. In an overbuilt retail real estate market, many investors want to avoid the retail REIT sector in which KRG operates.
Source:m01229 via Flickr
However, investors need to remember that brick-and-mortar retail is not dying, it is merely shrinking. Hence, prospective buyers should not necessarily avoid these stocks. Amid the abandoned malls across the landscape, retail REITs such as KRG stock have found a way to thrive.
Kite Realty has the good fortune (or good business sense) of owning property mostly in high-growth markets. Even in an overbuilt market, KRG maintains high occupancy and lease rates. Moreover, it is reshuffling its portfolio to increase this geographic focus. This has led to increased buying among insiders and hedge funds.
This may explain why the KRG stock price has begun to recover. KRG fell from just above $30 per share in 2016 before opening 2019 near its $13.66 52-week low. However, since then the stock has risen to above $15 per share.
The dividend has increased every year since 2014. Thanks to these payout hikes and a falling stock price, the $1.27 per share annual dividend yields above 8%. Retail REITs may look scary right now, but even in this depressed retail real estate market, KRG stock can still offer generous dividend yields at a reasonable price, so it definitely deserves to be included on a list of real estate stocks to buy for dividend income.
Omega Healthcare(NYSE:OHI) is an equity REIT specializing in skilled nursing and assisted living facilities across the U.S. and U.K. The company operates under a “triple-net” arrangement, meaning the lessor takes responsibility for taxes, insurance, and maintenance costs.
Source: Shutterstock
Thanks to the aging of the baby boom generation, around 10,000 people per day age into the Medicare system. Hence, demographics serve as the growth engine for this and many real estate stocks of this type.
The peak of the baby boom occurred in 1957, meaning this trend should peak in 2022. However, I think this growth should remain strong until 2029 when the last of the baby boom generation reaches age 65.
The dividend has enjoyed a steady growth trend since 2003. Today, the company pays an annual dividend of $2.64 per share. This takes the yield to just below 7%.
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Unlike many REITs, OHI stock may bring some stock price growth. The forward P/E stands at about 28. This may seem high for a REIT. However, analysts forecast an average growth rate of 15.8% per year over the next five years.
For this reason, both the dividend and the price of OHI stock should move higher over the next few years. Like with all healthcare REITs, I think investors need to stay mindful of demographics. However, as long as baby boomers keep aging into Medicare, I believe OHI will continue to prosper, justifying its inclusion on this list of real estate stocks to buy for dividend income.
As the name implies,Senior Housing Properties Trust(NYSE:SNH) operates 443 properties spread across 42 states and Washington, D.C. These consist of medical facilities, wellness centers, and communities for senior living spread across the United States. Like Omega, SNH stock should also benefit from a large baby boom generation aging into Medicare.
Source:Wikipedia
The annual dividend currently stands at 60 cents per share, leading to a yield of 6.94%.
Like many real estate stocks, SNH tends to see little price movement. SNH stock traded at about $9 per share at the time of its IPO in 2000. It sells for around $8.65 per share today and has fallen from a high above $28 per share in 2013.
If history serves as an indication, I would expect little price appreciation. However, for those who want a high dividend that should hold up for most of the next decade, SNH stock will serve that purpose well, making it one of the top five real estate stocks to buy for dividend income.
STAG Industrial(NYSE:STAG) buys and operates single-tenant industrial properties across the United States. It owns 76.8 million sq. feet of space spread across 390 properties in 37 states.
Source: Shutterstock
STAG stock and other industrial real estate stocks have benefited from an unexpected source of revenue over the last few years — e-commerce. As more retail business moves online, a large portion of retail real estate activity has moved into warehouses.
Thanks toAmazon(NASDAQ:AMZN) and other e-retailers, industrial space has rented as a premium. This premium has gone into profits, and by extension, dividends. Investors now receive 48 cents per share annually, a yield of 4.65%. Best of all, payouts come in the form of monthly dividends that have grown steadily over time.
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Moreover, the dividend should become a more critical component of STAG stock as growth slows down. After seeing an average 65% annual growth rate in the previous five years, analysts forecast growth of only 7% per year for the next five years. As a result, the stock has almost tripled since its low in 2011. I would expect with slower growth, the move higher should stop.
Still, blurring the line between industrial and retail properties has permanently changed the industry for STAG. The business created by e-commerce will not go away. Even if growth in the STAG stock price slows, expect the equity to maintain its stable, high-yielding monthly dividend, making it a top real estate stock to buy for dividend income.
Vereit(NYSE:VER) is one of the few equity real estate stocks that does not limit itself to one property type. This diversified REIT owns and operates industrial, office, restaurant, and retail properties across the country.
Source:lee via Flickr
Its portfolio consists of 95 million square feet spread across approximately 4,000 properties. The REIT owns buildings in 49 U.S. states as well as Puerto Rico.
VER stock had peaked at just above $15 per share in 2013, and it has declined for most of the time since. However, after bottoming at $6.52 nearly a year ago, the equity has turned around. Today, it trades at around $9, near its 52-week high. While I would not rule out a recovery, I would still recommend this primarily for income investors.
The dividend has delivered stability and steady increases over the same time frame. Right now, VER pays an annual dividend of 56 cents per share. That comes to a yield of about 6.02%. Though the company does not increase the dividend annually, it did hike the quarterly payout in 2018 and 2015, the year it switched from monthly to quarterly dividends.
Time will tell whether the VER stock price continues its move higher. Still, with a diversified real estate portfolio and steady, high-yield dividends, income investors should do well in Vereit regardless of the price action, so it’s definitely one of the top five real estate stocks to buy for dividend income.
As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You canfollow Will on Twitterat @HealyWriting.
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The post5 Real Estate Stocks to Buy for Dividend Incomeappeared first onInvestorPlace.
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Why MGM Resorts International Shares Jumped 15.7% in June
Shares of casino giantMGM Resorts International(NYSE: MGM)jumped 15.7% in June, according to data provided byS&P Global Market Intelligence, as investors got more bullish on the entire industry.
The biggest news for MGM Resorts came early in the month when Macao released its casino revenue figures. The region saw $3.21 billion of gambling revenue, which wasup a modest 1.8% from a year ago, but a big change from the 8.3% decline we saw in April.
The Macao skyline, including the tricolor MGM resort at the right. Image source: Getty Images.
In the U.S., improving investor sentiment about the economy and trade wars, which pushed the entire market higher, had a disproportionate effect on a casino stock like MGM because it's generally seen as a leveraged bet on consumer spending.
There wasn't a significant change in MGM's operations in June, but rather a change in market sentiment. Investors grew more bullish overall, pushing the entire market higher, and casino stocks were a big beneficiary. What I'm watching most closely in the rest of 2019 is Macao's gambling revenue and the share MGM captures. The company recently opened MGM Cotai there, which could be its best performing casino when fully operational. So there's a lot riding on Macao even though it contains only two of the company's resorts.
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Travis Hoiumhas no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has adisclosure policy.
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Should You Buy Mobile Mini, Inc. (NASDAQ:MINI) For Its Dividend?
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Today we'll take a closer look at Mobile Mini, Inc. (NASDAQ:MINI) 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 popular dividend stock because of its yield, and then lose money if the company's dividend doesn't live up to expectations.
In this case, Mobile Mini likely looks attractive to dividend investors, given its 3.6% dividend yield and six-year payment history. It sure looks interesting on these metrics - but there's always more to the story . Some simple research can reduce the risk of buying Mobile Mini for its dividend - read on to learn more.
Click the interactive chart for our full dividend analysis
Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Although Mobile Mini pays a dividend, it was loss-making during the past year. This is a middling range that strikes a nice balance between paying dividends to shareholders, and retaining enough earnings to invest in future growth. Besides, if reinvestment opportunities dry up, the company has room to increase the dividend.
The company paid out 66% of its free cash flow, which is not bad per se, but does start to limit the amount of cash Mobile Mini has available to meet other needs.
As Mobile Mini 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. Mobile Mini has net debt of 4.21 times its EBITDA, which is getting towards the limit of most investors' comfort zones. Judicious use of debt can enhance shareholder returns, but also adds to the risk if something goes awry.
Net interest cover can be calculated by dividing earnings before interest and tax (EBIT) by the company's net interest expense. Interest cover of 3.45 times its interest expense is starting to become a concern for Mobile Mini, and be aware that lenders may place additional restrictions on the company as well.
Remember, you can always get a snapshot of Mobile Mini's latest financial position,by checking our visualisation of its financial health.
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. Looking at the data, we can see that Mobile Mini has been paying a dividend for the past six years. During the past six-year period, the first annual payment was US$0.68 in 2013, compared to US$1.10 last year. Dividends per share have grown at approximately 8.3% per year over this time.
The dividend has been growing at a reasonable rate, which we like. We're conscious though that one of the best ways to detect a multi-decade consistent dividend-payer, is to watch a company pay dividends for 20 years - a distinction Mobile Mini has not achieved yet.
The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Mobile Mini has grown its earnings per share at 20% per annum over the past five years. A company paying out less than a quarter of its earnings as dividends, and growing earnings at more than 10% per annum, looks to be right in the cusp of its growth phase. At the right price, we might be interested.
When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. We're not keen on the fact that Mobile Mini paid dividends despite reporting a loss over the past year, although fortunately its dividend was covered by cash flow. We were also glad to see it growing earnings, although its dividend history is not as long as we'd like. Ultimately, Mobile Mini comes up short on our dividend analysis. It's not that we think it is a bad company - just that there are likely more appealing dividend prospects out there on this analysis.
Earnings growth generally bodes well for the future value of company dividend payments. See if the 5 Mobile Mini analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company.
Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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'Spider Man's' European vacation set to defy summer box office doldrums
Everyone’s favorite teenage wall crawler is back.
This time, Spider Man is looking to capitalize on the July 4 holiday. Box office watchers are expecting super-heroic returns that may help reverse this summer’s trend of underperforming big-budget movies.
Sony Pictures (SNE) and Marvel Studios’ (DIS) “Spider-Man: Far From Home” sends Tom Holland’s Spider-Man on a European vacation. Taking place after the universe-shattering events of “Avengers: Endgame,”Spider-Manis forced to team up with Samuel L. Jackson’s Nick Fury and Mysterio, a character played by veteran actor Jake Gyllenhaal.
But if there is one issue that Spider-Man does not have to worry about, it’s cleaning up at thebox office— yet again.
Industry sources expect “Far From Home” to gross $125 million during its six-day opening. So far, the movie is off to a strong start, with its debut showings pulling in around $40 million — a Tuesday opening day record.
“Getting a jump on the Fourth of July stateside will help the film's business spread out across the week,” said Shawn Robbins, chief analyst for Boxoffice.com.
Meanwhile,the pending re-release of “Endgame”is helping to reignite interest in Spider-Man , and Avengers-related films.
“The re-release of “Endgame” may be the most perfect lead-in for any Marvel movie ever,” added Paul Dergarabedian, sr. media analyst for Comscore.
The summer 2019 has seen its struggles at the box office, with a host of tentpole movies falling short of expectations. “X-Men:Dark Phoenix,” for example, has lost over $100 million.
Separately, Sony’s other most notable blockbuster of the summer, “Men in Black: International,” has grossed barely over $186 million worldwide on a $110 million budget, according to Box Office Mojo.
Spider-Man’s biggest helping hand may come from the fact that he has no real box office competition in the coming week, and the residual wave that tends to boost Avengers-related movies.
“Spidey will have very few roadblocks to worry about.Toy Story 4will cater to a younger audience going into its third frame, and the next biggest competitor—’The Lion King’ —will still be more than two weeks away,” Robbins said.
Jeremy Conrad, a media influencer and founder of the website MCU Cosmic, added that “many of the movies immediately following an Avengers [film] have seen an “Avengers bump,” like “Iron Man 3”— which got amixed reception from fans and criticsalike, but stilltopped $1 billion at the box office.
“Far From Home is directly impacted byEndgame, so coming after that movie should help it a lot,” Conrad said.
Both “Ant Man” movies benefited modestly from the Avenger boost, earning a relatively modest $519 million worldwide for the first “Ant Man” and over$622 million worldwidefor “Ant Man and The Wasp.”
Spider-Manhas performed well at the box office historically. The highest earning film is 2007’s “Spider-Man 3,” which grossed over $890 millionworldwide.
Then came 2017’s “Spider-Man: Homecoming,” the first solo outing for Tom Holland in the MCU. It is now the second highest grossing film within the franchise, earning over$880 million worldwide.
The lowest box office earner is “The Amazing Spider-Man 2,” at just over$709 million worldwide— still an impressive feat.
The franchise has been rebooted twice but shows no signs of wear, something analysts attribute to the relatability of the main character.
“People love Spider-Man because everyone can see themselves in him, and relate to him,” Conrad said.
Boxoffice.com’s Robbins stated that “his best stories are often ones that have him face the challenges of being an ordinary kid or young adult while having to balance the responsibilities of being a superhero.”
He added: “That vulnerability and his inherent wit make him endearing to a large audience, and he has one of the deepest benches of complex villains forMarvelto pull from in future film narratives.”
Donovan Russo is a writer for Yahoo Finance. Follow him@Donovanxrusso.
Read more:
• 'Avengers: Endgame' willing to do whatever it takes to top 'Avatar' at the box office
• Marvel Studios’ next heroic mission: Save the 'X-Men,' 'Fantastic Four'
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Is It Time To Consider Buying Baxter International Inc. (NYSE:BAX)?
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Today we're going to take a look at the well-established Baxter International Inc. (NYSE:BAX). The company's stock saw a decent share price growth in the teens level on the NYSE over the last few months. As a large-cap stock with high coverage by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s examine Baxter International’s valuation and outlook in more detail to determine if there’s still a bargain opportunity.
See our latest analysis for Baxter International
The stock seems fairly valued at the moment according to my valuation model. It’s trading around 16.19% above my intrinsic value, which means if you buy Baxter International today, you’d be paying a relatively fair price for it. And if you believe that the stock is really worth $70.33, then there isn’t really any room for the share price grow beyond what it’s currently trading. What's more, Baxter International’s share price may be more stable over time (relative to the market), as indicated by its low beta.
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by a double-digit 17% over the next couple of years, the outlook is positive for Baxter International. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
Are you a shareholder?BAX’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough conviction to buy should the price fluctuates below the true value?
Are you a potential investor?If you’ve been keeping an eye on BAX, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic prospect is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Baxter International. You can find everything you need to know about Baxter International inthe latest infographic research report. If you are no longer interested in Baxter International, you can use our free platform to see my list of over50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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How to Invest for the 2019 Earnings Growth Slowdown
• (1:00) - What Should We Expect From Q2 Earnings Season?
• (6:20) - Are We On The Verge Of A Earnings Recession?
• (10:15) - Is The Tech Sector Leading The Downturn?
• (15:30) - Will The Finance Sector Come Out Positive In Q2 Earnings?
• (17:00) - S&P Small Cap 600 Index: How Will The Small Caps Perform?
• (20:15) -"What" Stocks Should Investors Be Watching?
• (24:25) - Episode Roundup:MU, AAPL, ADBE, ORCL, MCD, MSFT, GS, SPY, SLY
Welcome to Episode #184 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life.
This week she’s joined by Zacks Director of Research, Sheraz Mian, to discuss what is going on with the earnings outlook for the second quarter and the full year.
After a fantastic earnings year in 2018, whereS&P 500 SPYearnings grew an astounding 23.3% thanks to the corporate tax cuts, earnings are currently expected to rise just 0.9% on the year.
And the second quarter is expected to be the weakest of the year with earnings forecast to decline 2.9% after falling 0.2% in Q1.
Additionally, the small-cap S&P 600 index is also expected to have a tough second quarter, with earnings forecast to fall 8.8%.
Is the earnings weakness signaling something “bad” like a recession possibly being on the horizon?
Or is it a red herring?
Technology to Blame?
The technology sector is one of the largest sectors in the S&P 500, with 22.6% of the index’s total earnings.
Thanks to the semiconductors, which have seen their earnings estimates cut in half the last two quarters, andApple AAPL, which is expected to see a fiscal 2019 earnings decline of 3.7%, the technology sector is now weighing on the entire index.
For the second quarter, earnings in the group are expected to decline 10.6% while revenue jumps 2.4%.
Earnings aren’t expected to get back into the positive in the tech group until the first quarter of 2020.
How can investors protect themselves during this earnings softness?
Look for Large Caps with Strong Businesses
1.Adobe ADBEisn’t expected to see the technology earnings growth slowdown. Earnings are forecast to rise 15.5% in fiscal 2019 and another 24% in fiscal 2020. Revenues are still expected to grow by the double digits this year and next. It’s not cheap, with a forward P/E of 38, but investors are paying for that strong growth.
2.Oracle ORCLis one of the “old” tech names which is growing revenue at just single digits but it’s cheap with a forward P/E of only 14.9. It, too, is expected to see solid earnings growth this fiscal year of 11%. It pays a dividend currently yielding 1.7%.
3.Microsoft MSFTis still putting together double-digit earnings growth despite being one of the old kids on the block. Earnings are expected to rise 18% this fiscal year and 11% next fiscal year for the tech giant. It also pays a dividend, currently yielding 1.4%.
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free reportApple Inc. (AAPL) : Free Stock Analysis ReportAdobe Systems Incorporated (ADBE) : Free Stock Analysis ReportMicrosoft Corporation (MSFT) : Free Stock Analysis ReportOracle Corporation (ORCL) : Free Stock Analysis ReportSPDR S&P 500 ETF (SPY): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment Research
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Are Stock-Pickers Factor Investors? Beyond Active or Passive
This article was originally published onETFTrends.com.
By Jan Erik Wärneryd,Optimum Quantvest Corporation
In recent years, there has been a lot of discussion in the investor community about the relative merits ofactive versus passivestrategies. The current consensus among those who favor the passive (indexing) side appears to be that active managers charge high fees while they (mostly) fail to beat the market over time. Those who favor active management would say that the indices, particularly cap-weighted ones, are flawed and that stock-pickers can outperform them by finding the best companies.
An alternative to both strategies is what's commonly called Smart Beta investing, which seeks to put together better portfolios that still own all or most of the names in the underlying indices but weigh them differently. A subset of Smart Beta strategies use "factor tilts" to establish portfolios that outperform over time by emphasizing compensated factors such as size, value or momentum. This is based on the belief that some attributes of stocks (factors) will give investors higher returns than a pure index portfolio.
Most investors tend to think in terms of the broad categories active, passive and Smart Beta as distinct investment approaches without realizing how they are related. Active strategies are generally thought of as focused on stock-picking, i.e. finding good stocks where the portfolio manager thinks there is potential to outperform the underlying index. This tends to result in more concentrated portfolios that often represent a style of investing such as "growth investing" or "value investing". To the portfolio manager, the focus is on finding stocks that meet certain criteria before doing a deeper analysis and finally selecting individual names for inclusion in the portfolio. The screening criteria could be earnings growth, P/E or Dividend yield, for example.
Another way of looking at this stage of the stock picking process is to say that portfolio managers are usingfactorsto screen for potential investments. A growth investor may be looking for stocks that have high momentum or quality factors, for example. A value investor is presumably screening for stocks with high exposure to the value factor. These investors may not be thinking in factor terms, but factor investing is part of their process. In other words, these investors have already decided which factors are attractive and have narrowed down the universe of stocks they will consider accordingly. Within the subset of stocks they consider there will be significant exposure to whatever factor was used to define their investable universe in the first place, which isn't that different from what a pure factor strategy would look like. The difference would be that the stock-picker, as opposed to the factor investor, looks at individual companies and seeks to add value by picking thebeststocks within their universe, assuming that the individual stocks are the source of performance.
The factor investor, on the other hand, believes it is the factor exposure that gives the performance. He or she is not doing research on individual stocks that meet the factor criteria but is content to own all the stocks in that universe. In the example of the Value investor, he or she is implicitly saying that an investor needs to pick the right factor (Value)andthe right stocks within the Value category to outperform the market. The Value factor investor says that it isenough to choose the factorrather than pick individual stocks. The ultimate strategy using this approach is of course to just own every stock in the index, which would be 100% passive. Factor investors believe that value can be added by focusing on the stocks that exhibit certain pre-determined attributes such as being cheaper than the market (Value), less volatile or exhibiting strong price momentum, rather than investing in the whole market.
So what we see from the above is that there is a continuum from passive to active investing; rather than being two distinct approaches, investors can apply aspects of both indexing and stock-picking to find where they think they can add value in the investing process. The passive/active approach can be further modified through for example sector investing, where a portfolio manager weighs sectors differently than the index based on sector attributes, which can be related to factors or macroeconomic forecasts. In our experience, the "sweet spot" for the return vs. fees trade off seems to be to focus on factors rather than stock-picking; investors may benefit from higher long term returns from the right factors for low incremental fees without taking the risks associated with stock-picking.
This article was written by Jan Erik Wärneryd, senior portfolio manager atOptimum Quantvest Corporation, a participant in theETF Strategist Channel.
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Are Investors Undervaluing Continental Building Products, Inc. (NYSE:CBPX) By 41%?
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How far off is Continental Building Products, Inc. (NYSE:CBPX) from its intrinsic value? Using the most recent financial data, we'll take a look at whether the stock is fairly priced by estimating the company's future cash flows and discounting them to their present value. I will use the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
We generally believe that a company's value is the present value of all of the cash it will generate in the future. However, a DCF is just one valuation metric among many, and it is not without flaws. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
Check out our latest analysis for Continental Building Products
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we need to discount the sum of these future cash flows to arrive at a present value estimate:
[{"": "Levered FCF ($, Millions)", "2020": "$82.3m", "2021": "$105.0m", "2022": "$115.0m", "2023": "$122.0m", "2024": "$128.0m", "2025": "$133.5m", "2026": "$138.6m", "2027": "$143.5m", "2028": "$148.2m", "2029": "$152.8m"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x4", "2021": "Analyst x1", "2022": "Analyst x1", "2023": "Analyst x1", "2024": "Est @ 4.96%", "2025": "Est @ 4.29%", "2026": "Est @ 3.82%", "2027": "Est @ 3.49%", "2028": "Est @ 3.26%", "2029": "Est @ 3.1%"}, {"": "Present Value ($, Millions) Discounted @ 10.2%", "2020": "$74.7", "2021": "$86.5", "2022": "$85.9", "2023": "$82.7", "2024": "$78.8", "2025": "$74.6", "2026": "$70.3", "2027": "$66.0", "2028": "$61.8", "2029": "$57.9"}]
("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= $739.2m
After calculating the present value of future cash flows in the intial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (2.7%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 10.2%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$153m × (1 + 2.7%) ÷ (10.2% – 2.7%) = US$2.1b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$2.1b ÷ ( 1 + 10.2%)10= $796.09m
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $1.54b. To get the intrinsic value per share, we divide this by the total number of shares outstanding.This results in an intrinsic value estimate of $44.22. Compared to the current share price of $25.91, the company appears quite good value at a 41% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Continental Building Products as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 10.2%, which is based on a levered beta of 1.253. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Although the valuation of a company is important, it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price to differ from the intrinsic value? For Continental Building Products, There are three pertinent factors you should further research:
1. Financial Health: Does CBPX have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does CBPX's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of CBPX? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. Simply Wall St updates its DCF calculation for every US stock every day, so if you want to find the intrinsic value of any other stock justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Should We Be Delighted With Mastech Digital, Inc.'s (NYSEMKT:MHH) ROE Of 18%?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. To keep the lesson grounded in practicality, we'll use ROE to better understand Mastech Digital, Inc. (NYSEMKT:MHH).
Mastech Digital has a ROE of 18%, based on the last twelve months. That means that for every $1 worth of shareholders' equity, it generated $0.18 in profit.
Check out our latest analysis for Mastech Digital
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Mastech Digital:
18% = US$6.3m ÷ US$35m (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 yearly profit. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies.
Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As you can see in the graphic below, Mastech Digital has a higher ROE than the average (13%) in the Professional Services industry.
That is a good sign. In my book, a high ROE almost always warrants a closer look. 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 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.
It's worth noting the significant use of debt by Mastech Digital, leading to its debt to equity ratio of 1.08. while its ROE is respectable, it is worth keeping in mind that there is usually a limit to how much debt a company can use. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt.
But when a business is high quality, the market often bids it up to a price that reflects this. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreethisdetailed graphof past earnings, revenue and cash flow.
Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Already cautious businesses grow even more wary about hiring
NEW YORK (AP) — Corri Smith is planning to hire a full-time project manager for her public relations firm and make her part-time assistant full-time. But she has a wary eye on the economy. "It's been a long time since we've had some trouble in the economy. It can't all be wonderful — something will happen," says Smith, owner of Charlotte, North Carolina-based Black Wednesday. Smith, who believes an economic downturn is likely in the next 12 to 18 months, says. "I will be extra cautious with hiring alongside also making plans to stockpile and save revenue." She's aware that marketing is one of the first budget items to be slashed when corporate executives are anxious about profits. Small business owners, who have taken a conservative approach to hiring during the economic expansion, are becoming even more careful amid concerns that the economy is weakening. They're well aware that economists believe the country's gross domestic product slowed considerably in the second quarter — forecasts give the GDP an annual rate of about 2%, down from 3.1% in the first quarter. Owners' concerns and caution are increased by the Trump administration's trade wars. Some owners are cutting jobs, likely by not filling their open positions as well as by laying off workers. A report from payroll processor ADP released Wednesday showed that its business customers with up to 49 employees cut 23,000 jobs in June on top of a 38,000 reduction in May; this is the first time ADP has reported job cuts since September 2017. So far this year, small businesses have added about 25,000 jobs on average each month, compared with an average 52,000 last year and 56,000 in 2017. Their hiring pace has lagged behind that of larger companies, which have fed the hiring boom in the country the past few years. Although the Great Recession ended 10 years ago, small business hiring never recovered to the levels before the downturn began in 2007. Owners who had laid off workers didn't want to go through that devastating process again, and new entrepreneurs learned from the unhappy experiences of others. Story continues Hiring is an ongoing balancing act for Scott Fish and business partner Sonja Skvarla, co-owners of Off Road, a business consulting firm based in Portland, Oregon. "Businesses are charging ahead, but there is a small element of uncertainty in the economy, and we are noticing that it continues to be on the minds of business owners," says Fish, So although Fish and Skvarla are considering as many as five new staffers over the next year, they're also treading carefully, hoping that their hiring is in sync with the work clients have for them. "It's a chicken-before-the-egg thing — do you have enough clients to support the cost of hiring someone great, or do you hire some great people and hope the revenue comes in," Fish says. Ethan Segal's decision to hire freelancers for his internet marketing firm was based partly on the economy. After the Federal Reserve raised interest rates in December, some of his largest clients put their projects on hold. "All of them decided to table not just my work but other companies' as well. It was shocking and sudden," Segal says. There are currently about 10 freelancers working at Philadelphia-based Segal & Co. Many small businesses also struggle to find qualified workers. While that can be a problem for companies of all sizes, small businesses generally can't offer the salaries and benefits that big corporations do, and with an economy that's looking iffy, the smaller player are at an even greater disadvantage. Because of competition for staffers from giants like Google, Facebook and Netflix, not only does software maker Gunner Technology not expect to hire in the next year, "we are looking at how we can get by without replacing employees we are sure to lose," CEO Cody Swann says. Swann's solution is to automate some of the work that software developers generally do at his Las Vegas-based company; for example, reviewing software coding to detect errors. The tariffs that the Trump administration has placed on thousands of products imported from China and retaliatory duties placed on U.S. goods are affecting many small businesses, even if they're not importers or exporters. Software manufacture Joe Wilson might have to put off hiring freelancers if he feels the ripple effects of tariffs that his customers must pay. "These issues impact the economy and people's confidence in the economy. It's easy for a business to defer spending money on a software project for a couple of quarters if they are worried about these things impacting their sector," says Wilson, owner of Volare Systems, based in Highlands Ranch, Colorado. Wilson uses freelancers because his work often involves customers' projects rather than their ongoing needs. He has three now, and hopes to hire two to five more in the next six months to a year — as long as the economy and/or tariff issues don't slow his business. Even what looks like robust hiring can be conservative. At GreenDropShip.com, a company that provides distribution services for small online retailers, Managing Director Allen Kaplun is considering hiring as many as 20 people over the next six months, adding on to his current staff of 70. But Kaplun says he's not going on a hiring spree because "we're certainly concerned about the economy." GreenDropShip.com's revenue is growing by 50% a year, while the staff additions Kaplun plans for the Denton, Texas, company amount to about 30%. "Based on our business model, that's pretty cautious behavior," he says. _____ Follow Joyce Rosenberg at www.twitter.com/JoyceMRosenberg . Her work can be found here: https://apnews.com
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Social Media Influencers Have to Pay Double at This Soft Serve Truck Because the Ice Cream Man Has Reached His Melting Point
While some brands might be eager for social media influencers to peddle their wares online, one ice cream man is fed up. Joe Nicchi, who runs the popular CVT soft serve ice cream truck in Los Angeles, is going viral for posting a photo to his Instagram page where he holds a sign saying that Influencers pay double. It was a strong stance against social media influencers, some of whom get freebies in exchange for goods or services. Nicchi opened the bare bones ice cream truck in 2014 to sell just chocolate, vanilla or twist soft-serve ice cream out of a vintage Mr Softee. (The flavors he sells gave his truck the name, CVT Soft Serve.) While his $4 ice cream isnt exactly pricey, Nicchi says he received a number of requests by social media influencers asking him to give them a cone for free in exchange for being featured in an Instagram Story or other social media post. Vice reports that when Nicchi was asked to serve ice cream to a 300-person event for free in exchange for exposure, he reached his breaking point, which he documented on Instagram. Thats when he decided to take a stand and posted his sign to his truck and his photo to Instagram. View this post on Instagram Weve decided to make this thing official with signage. We truly dont care if youre an Influencer, or how many followers you have. We will never give you a free ice cream in exchange for a post on your social media page. Its literally a $4 item...well now its $8 for you. #InfluencersAreGross A post shared by CVT Soft Serve (@cvtsoftserve) on Jun 30, 2019 at 11:08am PDT Its particularly grating to Nicchi and crew because they arent exactly dying for exposure. The year they opened they were named Best Food Truck in L.A. by LA Weekly , topped Los Angeles magazines best food truck listings in 2017, and they earned a mention as one of the Best Dessert Food Trucks again in 2018. Theyve been written up by Goop as part of a Definitive LA Food Truck Guide . Plus, they hosted a Bill Murray ice cream social that Bill Murray actually attended (and was covered by the national media, including Rolling Stone has been listed as one of the five best things we ate at food review site Zagat. The ice cream truck owner told NBC Los Angeles that while he appreciates the offers, he is running a business and has bills to pay, bills that cant be paid by exposure. He has now instructed his team to ignore social media influencer inquiries altogether. In an ironic twist, the photo of Nicchi went viral after the image was posted to Reddit, and quickly made it to the sites front page. As Nicchi now is his own social media influencer, hopefully he will use his powers for good.
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Need To Know: Corvus Pharmaceuticals, Inc. (NASDAQ:CRVS) Insiders Have Been Buying Shares
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It is not uncommon to see companies perform well in the years after insiders buy shares. 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 inCorvus Pharmaceuticals, Inc.(NASDAQ:CRVS).
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, most countries require that the company discloses such transactions to the market.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
See our latest analysis for Corvus Pharmaceuticals
In the last twelve months, the biggest single purchase by an insider was when Chief Financial Officer Leiv Lea bought US$102k worth of shares at a price of US$4.15 per share. That means that an insider was happy to buy shares at around the current price of US$5.02. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. In this case we're pleased to report that the insider purchases were made at close to current prices.
In the last twelve months insiders paid US$434k for 114k shares purchased. While Corvus Pharmaceuticals insiders bought shares last year, they didn't sell. 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!
There are plenty of other companies that have insiders buying up shares. You probably donotwant to miss thisfreelist of growing companies that insiders are buying.
Over the last three months, we've seen significant insider buying at Corvus Pharmaceuticals. In total, insiders bought US$183k worth of shares in that time, and we didn't record any sales whatsoever. This makes one think the business has some good points.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. 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 6.4% of Corvus Pharmaceuticals shares, worth about US$9.5m, according to our data. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. But on the other hand, the company made a loss last year, which makes us a little cautious. While the overall levels of insider ownership are below what we'd like to see, the history of transactions imply that Corvus Pharmaceuticals insiders are reasonably well aligned, and optimistic for the future. Of course,the future is what matters most. So if you are interested in Corvus Pharmaceuticals, 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.
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Why American children are moving to Mexico in record numbers
kids-walking-to-US While much of the current news has been focused on Central American migrants making their way through Mexico to the US, little attention has been paid to a different migration story: the number of American-born minors—all US citizens—who left the US to live in Mexico. In Mexico, about 900,000 residents were born abroad as of 2015. Some of these are Central American migrants, but the large majority was born in the US and is under age 18. Jeffrey Epstein’s fortune is built on fraud, a former mentor says In fact, between 2000 and 2015, the population of American minors living in Mexico more than doubled. By 2015, nearly half a million minors born in the US lived south of the border. Although there have always been US citizens under 18 in Mexico, never before have so many left the US to live and grow up in Mexico. Who are these children and adolescents? Where and with whom do they live in Mexico? Our research , published on June 10, uses Mexican census and intercensal data to reveal new insights into the characteristics of this group of young American citizens in Mexico. The simplest way to improve your credit score is by using your email When did they leave the US? The growth in Mexico’s population of US citizen minors largely occurred between 2000 and 2010. During this period, the Great Recession led to high rates of return migration to Mexico. At the same time, the number of US removals increased annually, to a peak of 409,000 in 2012. Our interviews with returnees in Mexico City suggest that both economic crisis and immigration enforcement drove the migration of US-born minors to Mexico in the second half of the 2000s. Migration of US-born children to Mexico In 2010 and 2015, the majority of the minors were primary school-aged. In 2010, twice as many were under age 5 as were over age 12. But in 2015, about equal proportions were under 5 or over 12. Age of US-born children living in Mexico Who are their parents? The vast majority of this group has Mexican-born parents. In 2015, more than one-third of US-born minors lived in Mexico without one or both parents. Father absence is especially common. Nearly one-third lived without their father, while 10% lived without their mother. Story continues Seven in 10 US-born minors who do not live with their parents live with a grandparent. By comparison, only half of Mexican-born minors do not live with their parents. children-in-mexico Where in Mexico do they live? The largest group of US immigrants from Mexico originated in the center-west of Mexico , the historic migrant-sending region that includes the states of Jalisco, Michoacán, and Guanajuato. However, US-born minors settled in Mexico in locations that are distinct from where most US-bound immigrants originated. Our analysis shows that the largest group of US-born minors lives in states along the Mexico-US border, especially Baja California and Chihuahua, where cities like Tijuana and Ciudad Juárez are located. This suggests that, though these minors now live in Mexico, they maintain some ties to the US. For example, some parents live along the border in order for their children to commute from Mexico to school in the US. What does the future hold? The migration of US-born minors from the US to Mexico presents unique challenges to the minors themselves, as well as to their families and their communities. For instance, we found that, in 2010, 53% of US citizens under 18 living in Mexico did not have Mexican citizenship. Children who do not have Mexican documents cannot easily enroll in Mexican public schools . Furthermore, children who do not speak Spanish well will face problems learning in Mexican schools . The US public is concerned with the more than one million undocumented youth—or Dreamers. Many of this group live in “mixed-status families,” where at least one member is a US citizen. US citizen minors in Mexico also live in mixed-status families, but in some ways the challenges they face are distinct: They have the possibility for legal integration, but still face barriers to social and economic integration in Mexico. We do not know what the future holds for this large group of young US citizens with deep roots in both countries. The answer will undoubtedly unfold on both sides of the border. The Conversation This article is republished from The Conversation under a Creative Commons license. Read the original article . Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: The glow of the historic accord between Ethiopia and Eritrea has faded Zimbabwe banned the US dollar from being used so local bitcoin demand is soaring again
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What Is the MCAT Test Like and How Do You Prepare for It?
The difficulty of the Medical College Admission Test , or MCAT , means that anyone who plans to take this entrance exam should spend a significant amount of time studying for it. "Make sure that you feel that you are completely ready to take it before you sit for the exam," says Timothy Malone, who is pursuing an M.D. and a Master of Public Health degree through a dual-degree program at St. George's University. "If you have any doubts, push off the exam to a later test date." Here are the essential facts to know about the MCAT before signing up to take the test. [ Read: Learn How Medical Schools Weigh GPA, MCAT. ] What Is the MCAT Like and What Purpose Does It Serve? The MCAT is designed to assess whether prospective medical students have the conceptual understanding and analytical skills necessary for success in medical school, according to Karen Mitchell, the senior director of admissions testing service with the Association of American Medical Colleges, the organization that creates and administers MCAT exams. The format and content of the MCAT is informed by input of medical school faculty, medical residents and medical students based on their judgments of what academic preparation ought to be required for medical school, Mitchell adds. "The MCAT exam has been part of the medical school admissions process for over 90 years, and almost all medical schools in the United States, and many in Canada, require applicants to submit recent MCAT scores as part of their application," she wrote in an email. "Many health professions and graduate programs also accept MCAT scores in lieu of other standardized tests. The exam was revised in 2015 to reflect recent changes in medicine and science and to test examinees on not only what they know, but how well they use what they know." MCAT Sections The MCAT is split into four sections, and a test-taker's performance on each of these sections is weighted equally in his or her overall score. The four sections are: Story continues -- Biological and Biochemical Foundations of Living Systems. -- Chemical and Physical Foundations of Biological Systems. -- Critical Analysis and Reasoning Skills. -- Psychological, Social and Biological Foundations of Behavior. Three of the four sections of the MCAT focus on natural and social sciences and are based upon lessons learned in undergraduate courses , Mitchell says. In contrast, the Critical Analysis and Reasoning Skills section of the MCAT is not scientifically oriented and does not require "specific content knowledge." It tests reading comprehension abilities, she says. "The Critical Analysis and Reasoning Skills section was developed to measure the analytical and reasoning skills needed to be successful in medical school," Mitchell explains. "It covers a wide range of disciplines in the social sciences and humanities, including those in population health, ethics and philosophy, and studies of diverse cultures." How Much Does the MCAT Cost? According to the MCAT fee schedule posted on the AAMC website, the initial registration fee to sign up for the MCAT is $315 for the 2019 testing year. However, med school hopefuls with difficult financial circumstances may qualify for the AAMC's fee assistance program . The program enables premeds with demonstrated financial need to receive discounts on their MCAT registration fees, alongside free test prep resources and complimentary access to the Medical School Admission Requirements database. How Long Is the MCAT? "The total seated time for the MCAT exam is approximately seven and a half hours," Mitchell says. "This time includes six hours and 15 minutes of actual content time, 50 minutes worth of breaks and approximately 25 minutes of administrative tasks such as test-day certification, an MCAT tutorial and an optional survey upon completion of the exam." MCAT Scores An MCAT test-taker's total score on the exam can be as low as 472 or as high as 528, and this score is determined based upon the sum of a student's section scores, each of which ranges from a minimum of 118 to a maximum of 132. MCAT test-takers are rewarded for correct answers to test questions, but they are not penalized for wrong answers, so they should make their best guess on questions where they are unsure of the right answer, Mitchell says. "The MCAT exam is not graded on a curve," she says. "Instead, the MCAT exam is scaled and equated so that scores have the same meaning, no matter when an examinee tests or who tests at the same time they did." According to MCAT test prep experts, perfect and near-perfect overall MCAT scores are exceedingly rare , so premeds should not expect to achieve these scores. "A perfect score in a section isn't necessarily exceedingly rare, but an overall perfect score is, you know, like a unicorn," says Dr. Ryan Gray, the publisher and CEO of Meded Media, a company that produces content for premeds. "It happens, but it's not something to shoot for at all. ... I see students who shoot for those perfect scores do it at the expense of having a more well-rounded application, and those students -- even with really great scores -- don't get into medical school, because the rest of their application isn't what it needs to be." [ Read: What Is a Good MCAT Score? ] MCAT Percentiles According to the AAMC, premeds who achieve the following MCAT scores have equaled or surpassed the achievements of the vast majority of MCAT test-takers in 2016, 2017 and 2018. Total score Percentile rank 510 Equal to or superior to 80 percent of MCAT test-takers 514 Equal to or superior to 90 percent of MCAT test-takers 517 Equal to or superior to 95 percent of MCAT test-takers 520 Equal to or superior to 98 percent of MCAT test-takers 521, 522 or 523 Equal to or superior to 99 percent of MCAT test-takers Average MCAT Scores The mean MCAT score among med school applicants seeking admission to U.S. medical schools in the 2018-2019 school year was 505.6, according to AAMC statistics. However, the average MCAT score among applicants who were admitted and actually matriculated at U.S. medical schools in that same year was higher: 511.2. MCAT Test Dates and Locations "The MCAT exam is administered at computer-based test center locations throughout the United States, Canada and select locations internationally," Mitchell says. "The testing calendar runs from January through September and includes over 35 testing dates." Premeds may use the online MCAT Registration System in order to see a list of all the MCAT test centers, Mitchell says. "Test centers have fixed capacity, and seats are reserved on a first-come, first-served basis," she says. "If examinees are unable to secure their preferred appointment, a notification system was recently implemented, which enables examinees to be notified when that appointment becomes available." MCAT Registration Katherine Thomson, senior curriculum manager with Magoosh, a test prep company, suggests that premeds should attempt to schedule their MCAT exam as soon as possible after slots open up for their desired test date, since spots may run out. "Registration for the MCAT is split into two phases," she says. "In October, students may begin to register for January through May test dates. June through September test dates open for registration in February. You can follow the AAMC on Twitter to learn the exact time when registration opens," Thomson says. Thomson adds that students who need their MCAT scores back by a certain date should take that into account when they schedule their MCAT test, since it takes about 30 days after the test to receive a score. "Because of the MCAT score release delay, take the MCAT by May if you want your application to be among the earliest reviewed by medical schools," she says. MCAT Prep It is common for premeds to say that they are unsure how to start preparing for the MCAT, Mitchell says. "To address this concern, the AAMC has developed a free six-step guide to creating a study plan," she says. "The study plan walks students through a simple planning process that helps them evaluate their current level of knowledge, organize their resources, plan their study schedule and simulate a mock exam day before the actual test day." She adds that the AAMC provides an abundance of MCAT test prep resources, including many which are free. Med students say that, because the MCAT is a multi-hour exam that covers a variety of academic disciplines including both science and non-science subjects, it's crucial to prepare for the length and breadth of the exam. "The best way to do it is to take a lot of practice tests," says Cameron Ward, a student at the University of Texas Southwestern Medical Center . Ward says his approach to building up the endurance necessary to complete the entire MCAT test in one sitting was to progressively tackle more significant chunks of the test until he could complete the entire test in one go. Then Ward repeatedly took the full-length exam until it felt normal, he says. "By the time the test came around, I was accustomed to the length, and I had learned how to maintain focus" for an extended time period, Ward says. Taking practice tests helps students identify which topics to focus on during their test prep, Ward says. Divya Vaithiswaran, an M.D. student at St. George's University, says that MCAT prep can be "disheartening" and "humbling" at times, however, it is possible to perform well on the test even if preparing for it is challenging. "The anxiety of taking the test is very real," she says. "People need to realize that, when you start studying for the MCAT, a lot of times you feel like you can't do it because you're not scoring as well as you should." Vaithiswaran says premeds shouldn't get discouraged if they initially struggle with practice MCAT exam questions. "No one starts studying for the MCAT knowing everything," she adds. Lauren Friedrich, a UT Southwestern medical student, says the best way for premeds to decide what their target MCAT score should be is to research what the typical scores are among admitted students at the med schools where they plan to apply. Friedrich says that she waited to take the MCAT until she had finished premed courses that were relevant to the test, such as psychology and sociology. [ Read: 3 Inexpensive Ways to Study for the MCAT. ] How Important Is the MCAT During the Medical School Admissions Process? Dr. Blake Barker, associate dean for student affairs at UT Southwestern Medical Center, says med school hopefuls should be careful not to overestimate the weight that the MCAT is given in admissions decisions. "Medical schools really intently look at the whole application in its entirety ... with (the) MCAT just being one piece," he says. "Think of your application like a pizza, and if one piece of the pizza is a little bit smaller than the rest, that means that the rest of the pieces need to be a bit bigger to make a whole pizza." Searching for a medical school? Get our complete rankings of Best Medical Schools. More From US News & World Report Undergrad Courses to Take for MCAT Success Why the MCAT Is Harder Than a Typical College Exam 12 Medical Schools With the Highest MCAT Scores
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Don't Sell Banc of California, Inc. (NYSE:BANC) 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! The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). To keep it practical, we'll show how Banc of California, Inc.'s ( NYSE:BANC ) P/E ratio could help you assess the value on offer. Banc of California has a price to earnings ratio of 34.31 , based on the last twelve months. In other words, at today's prices, investors are paying $34.31 for every $1 in prior year profit. See our latest analysis for Banc of California 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 Banc of California: P/E of 34.31 = $13.75 ÷ $0.40 (Based on the year to March 2019.) Is A High P/E Ratio Good? A higher P/E ratio implies that investors pay a higher price for the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E. How Growth Rates Impact P/E Ratios Companies that shrink earnings per share quickly will rapidly decrease the 'E' in the equation. Therefore, even if you pay a low multiple of earnings now, that multiple will become higher in the future. So while a stock may look cheap based on past earnings, it could be expensive based on future earnings. Banc of California saw earnings per share decrease by 32% last year. And EPS is down 33% a year, over the last 3 years. This might lead to low expectations. Does Banc of California Have A Relatively High Or Low P/E For Its Industry? The P/E ratio indicates whether the market has higher or lower expectations of a company. You can see in the image below that the average P/E (12.9) for companies in the banks industry is lower than Banc of California's P/E. NYSE:BANC Price Estimation Relative to Market, July 3rd 2019 Banc of California's P/E tells us that market participants think the company will perform better than its industry peers, going forward. The market is optimistic about the future, but that doesn't guarantee future growth. So investors should always consider the P/E ratio alongside other factors, such as whether company directors have been buying shares . 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. Thus, the metric does not reflect cash or debt held by the company. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash). While growth expenditure doesn't always pay off, the point is that it is a good option to have; but one that the P/E ratio ignores. So What Does Banc of California's Balance Sheet Tell Us? Banc of California's net debt is considerable, at 113% of its market cap. If you want to compare its P/E ratio to other companies, you must keep in mind that these debt levels would usually warrant a relatively low P/E. The Bottom Line On Banc of California's P/E Ratio Banc of California has a P/E of 34.3. That's higher than the average in the US market, which is 18.2. With significant debt and no EPS growth last year, shareholders are betting on an improvement in earnings from the company. Investors should be looking to buy stocks that the market is wrong about. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. So this free visualization of the analyst consensus on future earnings could help you make the right decision about whether to buy, sell, or hold. But note: Banc of California may not be the best stock to buy . So take a peek at this free list of interesting companies with strong recent earnings growth (and a P/E ratio below 20). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor 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.
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New U.S. census turmoil as Trump again pursues citizenship question
By Lawrence Hurley WASHINGTON (Reuters) - President Donald Trump said on Wednesday he was moving ahead with adding a contentious citizenship question to the 2020 U.S. census in a dramatic reversal after his own administration including Commerce Secretary Wilbur Ross announced a day earlier that the plan had been dropped. Following Trump's announcement, made in a defiant Twitter post, a senior U.S. Justice Department lawyer told a Maryland-based federal judge overseeing litigation in the matter that the administration was seeking a "path forward" to add a citizenship question after the Supreme Court last Thursday blocked it, at least temporarily. The Supreme Court found that administration officials had given a "contrived" rationale for including the query in the decennial population survey, but the court left open the possibility the administration could offer a plausible rationale. Facing a deadline to get the census forms printed, administration officials including Ross said on Tuesday they were going ahead without including the question. Critics have called the citizenship question a Republican ploy to scare immigrants into not taking part in the census and engineer a population undercount in Democratic-leaning areas with high immigrant and Latino populations. That would benefit non-Hispanic whites and help Trump's fellow Republicans gain seats in the U.S. House of Representatives and state legislatures when new electoral district boundaries are drawn after the census, the critics said. "The News Reports about the Department of Commerce dropping its quest to put the Citizenship Question on the Census is incorrect or, to state it differently, FAKE! We are absolutely moving forward, as we must, because of the importance of the answer to this question," Trump wrote on Twitter. The census will continue to be printed without the citizenship question while the administration re-evaluates all options to see if it could win a new lower court decision that would permit it to add the question, according to a person familiar with the administration's thinking. Story continues Trump's hardline policies on immigration have been a key element of his presidency and 2020 re-election campaign. Trump last Thursday also said he was exploring whether the census, which the U.S. Constitution requires be carried out every 10 years, can be delayed. "We at the Department of Justice have been instructed to examine whether there is a path forward consistent with the Supreme Court decision that would allow us to include the citizenship question on the census," Assistant Attorney General Joseph Hunt told Maryland-based U.S. District Court Judge George Hazel on Wednesday, according to a court transcript obtained by Reuters. Hunt did not make clear who issued the instruction. The Justice Department on Tuesday had told Hazel that the administration had made a final decision not to proceed with the citizenship question, according to two lawyers involved in the litigation. The judge then held a call with lawyers in the case after Trump's Wednesday announcement. "We think there may be a legally available path under the Supreme Court's decision. We're examining that, looking at near-term options to see whether that's viable and possible," Hunt said. Hazel said he wants a final response by Friday afternoon on whether the government will press ahead with adding the citizenship question. Otherwise, legal claims accusing administration officials of being motivated by racial bias in adding the citizenship question will move forward. Hazel refused to allow the government more time to respond. "If you were Facebook and an attorney for Facebook told me one thing, and then I read a press release from (Facebook Chief Executive) Mark Zuckerberg telling me something else, I would be demanding that Mark Zuckerberg appear in court with you the next time because I would be saying I don't think you speak for your client anymore," Hazel said. Hazel indicated regret that he "hadn't gone far enough in terms of pinning the government down on where things stand," during the previous call on Tuesday. Manhattan-based U.S. District Judge Jesse Furman, presiding over a similar case, also pressed administration lawyers for an explanation. 'CHAOS AND CONFUSION' Opponents of the question condemned Trump's announcement. "Another day, another attempt to sow chaos and confusion," New York's Democratic Attorney General Letitia James, who is involved in the legal challenge, said. "The Supreme Court of the United States has spoken, and Trump's own Commerce Department has spoken. It's time to move forward to ensure every person in the country is counted." Ross, a key figure in the controversy, had said in a statement on Tuesday, "The Census Bureau has started the process of printing the decennial questionnaires without the question." A Justice Department lawyer told Hazel that this printing in fact was continuing. Trump's administration had told the courts that its rationale for adding the question was to better enforce a law that protects the voting rights of racial minorities. Critics called that rationale a pretext for partisan motives. The Supreme Court's ruling had left open the possibility of Trump adding the question in the future with a new rationale, an outcome that seemed unlikely because administration officials had said in court filings that they needed to finalize the details of the census questionnaire by the end of June. The American Civil Liberties Union (ACLU), which was part of the Supreme Court lawsuit, said any new rationale would not pass legal muster. "Any attempt at an end run around the Supreme Court's decision will be unsuccessful, and will be met swiftly in court," Dale Ho, director of the ACLU's Voting Rights Project, said in a statement. The census is used to allot seats in the U.S. House and distribute some $800 billion in federal funds. Opponents have said a citizenship question would instill fear in immigrant households that the information would be shared with law enforcement, deterring them from taking part. Citizenship status has not been asked of all households since the 1950 census. Since then, it has been included only on questionnaires sent to a smaller subset of the population. A group of states including New York and immigrant rights organizations challenged the legality of the citizenship question. Hazel, Furman and a third judge all issued rulings blocking the question, prompting the administration's Supreme Court appeal. (Reporting by Lawrence Hurley; Additional reporting by Sarah N. Lynch, Makini Brice, Nick Brown and Lauren LaCapra; Editing by Will Dunham and Richard Chang)
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Asda boss sees possible stock market listing in two to three years
By James Davey
LONDON (Reuters) - The timescale for a possible stock market listing of British supermarket group Asda, by its U.S. parent Walmart <WMT.N>, is two to three years, Asda's boss said on Wednesday.
Walmart said in May it would look at an initial public offering (IPO) for Asda after Britain's competition regulator blocked a 7.3 billion pound ($9.2 billion) takeover by rival Sainsbury's <SBRY.L>.
"If I was a betting man, I just think that is the sort of time the process will probably take," Asda Chief Executive Roger Burnley told Reuters.
"I use the phrase specifically that we're 'minded' to an IPO," he said, explaining that both Walmart and Asda had not reached a firm decision or were at a point of discussing a specific date.
Walmart, which purchased Asda for 6.7 billion pounds in 1999, was not in any rush.
"There's no burning platform, it's whatever Walmart feel would be the best to make Asda successful and sustainable long term," said Burnley.
Asked if Walmart was likely to retain a majority stake in Asda if it did decide on an IPO, he said: "I very much think so."
Burnley, CEO since January 2018, said Asda would work to convince investors in the meantime that the company has a bright future.
"We need to be performing in the short term, create growth in the medium term and create a sustainable story in the long term."
Speaking on the sidelines of Asda's "Christmas in July" event where it showcases its festive product line-up, Burnley said Walmart's support has been "very strong" since the failure of the Sainsbury's deal.
"Walmart will listen to any investments I want to make for sure, to make us sustainable into the future," he said.
Burnley's strategy is focused on lower prices to narrow the gap with German-owned discounters Aldi and Lidl, more innovation in own-brand products, better store standards and improvements in e-commerce operations.
Though Asda has reported eight straight quarters of underlying sales growth, in May it warned of an "increasingly challenging backdrop".
"We're definitely in tough times, we're in a little bit of a perfect storm," Burnley said of the UK macro economic backdrop.
Echoing comments earlier on Wednesday from Sainsbury's, he pointed to ongoing uncertainty around Brexit and a tough comparison with the same period last year when Britain enjoyed record hot weather and major events including a royal wedding and the men's soccer World Cup.
In common with market leader Tesco <TSCO.L> and Sainsbury's, he also said planning for a disorderly no-deal Brexit on Oct. 31 would be more difficult than the original March departure date because logistics networks will be full of Christmas stock.
(Reporting by James Davey, Editing by Paul Sandle and Elaine Hardcastle)
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Zacks.com featured highlights include: Napco Security Technologies, iQIYI, Village Farms International, Plantronics and Aerojet Rocketdyne
For Immediate Release
Chicago, IL – July 3, 2019 - Stocks in this week’s article are Napco Security Technologies, Inc. NSSC, iQIYI, Inc. IQ, Village Farms International, Inc. VFF, Plantronics, Inc. PLT and Aerojet Rocketdyne Holdings, Inc. AJRD.
5 Stocks in the Limelight on New Analyst Coverage
Most investors have immense faith in research work by analysts as they fear that lack of information while exploring on their own might trigger inefficiencies. Here, analysts play a vital intermediary role with their extensive access to relevant data.
Coverage initiation of a stock by analyst(s) usually portrays higher investor inclination. Investors, on their part, often assume there is something special in a stock to attract analysts to cover it. In other words, they believe that the company coming under the microscope definitely has some value.
Obviously, stocks are not randomly chosen to cover. New coverage on a stock usually reflects a reassuring future envisioned by the analyst(s). At times, increased investors’ focus on a stock motivates analysts to take a closer look at it. After all, who doesn’t love to produce something that is already in demand? Hence, we often find that analysts’ ratings on newly added stocks are more favorable than their ratings on continuously covered stocks.
It is needless to say, the average change in broker recommendation is more preferable than a single recommendation change.
How Does Analyst Coverage Influence Stock Price?
The price movement of a stock is generally a function of the recommendations on it from new analysts. Stocks typically see an upward price movement with a new analyst coverage compared to what is witnessed with a rating upgrade under an existing coverage. Positive recommendations – Buy and Strong Buy – generally lead to a significantly positive price reaction than Hold recommendations. On the contrary, analysts hardly initiate coverage with a Strong Sell or Sell recommendation.
Now, if an analyst gives a new recommendation on a company that has very few or no existing coverage, investors start paying more attention to it. Also, any new information attracts portfolio managers to build a position in the stock.
So, it’s a good strategy to bet on stocks that have seen increased analyst.
For the rest of this Screen of the Week article please visit Zacks.com at:https://www.zacks.com/stock/news/437051/5-stocks-in-limelight-on-new-analyst-coverage
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
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Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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 reportPlantronics, Inc. (PLT) : Free Stock Analysis ReportAerojet Rocketdyne Holdings, Inc. (AJRD) : Free Stock Analysis ReportNAPCO Security Technologies, Inc. (NSSC) : Free Stock Analysis ReportVILLAGE FARMS (VFF) : Free Stock Analysis ReportiQIYI, Inc. Sponsored ADR (IQ) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Why you should immediately bubble wrap your investment portfolio
It’s time to tear yourself off a piece of bubble wrap and tie it tightly around your investment portfolio.
“I think [the U.S. economy in] 2020 is certainly murky. One of the challenges I have as a strategist is trying to get my hands around the sheer damage that the trade tensions have caused from an economic point of view. These trade tensions have been bubbling up for 18 months now, but we didn’t see that showing up much in the economic data. It’s only in the last couple of quarters - so it’s starting to do some damage,” explained JPMorgan Asset Management economist Alex Dryden on Yahoo Finance’sThe First Trade.
The trade war related damage to the U.S. economy has Dryden advising clients to be cautious on stocks right now.
“As we get an idea of that damage, 2020 becomes more difficult. What I have been saying to investors is that now is the time to be cautious. I think it’s time to add what I call bubble wrap to your clients’ portfolios, a little bit of padding and protection to make sure that if we do hit some bumps in the road down the line that volatility doesn’t de-stabilize portfolios,” Dryden added.
Top economist Mark Zandi over at Moody’s Analytics agreesthat the U.S. trade war with China is doing damage to the economy.
Clearly, investors haven’t yet taken a trip to Home Depot for a roll of Dryden’s portfolio protecting bubble wrap.
The S&P 500 notched another record high on Wednesday as investors — as insane as it sounds — continue to cheer worsening reads on the health of the U.S. economy. As the logic goes on Wall Street at the moment, bad news on the economy (see latest ADP jobs report) will only push the Federal Reserve to deliver an interest rate cut shortly.
Investors love putting money to work alongside cheap money from the Fed narrative. Look no further for evidence of that at the aggressive bets being placed of late on trade war related stocks such as Apple and Micron.
As for the next potentially weak economic report that could fuel stocks? Fix your eyes on the June employment report due out on Friday.
Might want to get some of that bubble wrap before that report, just in case — market sentiment could turn at the drop of a dime.
Brian Sozzi is an editor-at-large and co-host of ‘The First Trade’ at Yahoo Finance. Follow Brian Sozzi him on Twitter@BrianSozzi
Read the latest financial and business news from Yahoo Finance
• Why Shake Shack CEO is testing a 4-day workweek
• Trump's trade war with China may shock investors this summer
• 2 black swans could come out of nowhere and kill stocks this summer
• Why scrapping Trump's corporate tax cuts could crush businesses
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How Good Is McGrath RentCorp (NASDAQ:MGRC) At Creating Shareholder Value?
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Today we'll look at McGrath RentCorp (NASDAQ:MGRC) and reflect on its potential as an investment. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires.
First, we'll go over how we calculate ROCE. Then we'll compare its ROCE to similar companies. And finally, we'll look at how its current liabilities are impacting its ROCE.
ROCE is a measure of a company's yearly pre-tax profit (its return), relative to the capital employed in the business. Generally speaking a higher ROCE is better. In brief, it is a useful tool, but it is not without drawbacks. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
The formula for calculating the return on capital employed is:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for McGrath RentCorp:
0.11 = US$123m ÷ (US$1.2b - US$92m) (Based on the trailing twelve months to March 2019.)
So,McGrath RentCorp has an ROCE of 11%.
See our latest analysis for McGrath RentCorp
One way to assess ROCE is to compare similar companies. We can see McGrath RentCorp's ROCE is around the 11% average reported by the Commercial Services industry. Aside from the industry comparison, McGrath RentCorp'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.
We can see that , McGrath RentCorp currently has an ROCE of 11% compared to its ROCE 3 years ago, which was 7.2%. This makes us think the business might be improving. You can click on the image below to see (in greater detail) how McGrath RentCorp's past growth compares to other companies.
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. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Since the future is so important for investors, you should check out ourfreereport on analyst forecasts for McGrath RentCorp.
Short term (or current) liabilities, are things like supplier invoices, overdrafts, or tax bills that need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To counter this, investors can check if a company has high current liabilities relative to total assets.
McGrath RentCorp has total assets of US$1.2b and current liabilities of US$92m. As a result, its current liabilities are equal to approximately 7.4% of its total assets. With low levels of current liabilities, at least McGrath RentCorp's mediocre ROCE is not unduly boosted.
If performance improves, then McGrath RentCorp may be an OK investment, especially at the right valuation. You might be able to find a better investment than McGrath RentCorp. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).
I will like McGrath RentCorp better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Zacks.com featured highlights include: Party City, JinkoSolar, Legg Mason, SYNNEX and American International
For Immediate Release Chicago, IL – July 3, 2019 - Stocks in this week’s article are Party City Holdco Inc. PRTY, JinkoSolar Holding Co., Ltd. JKS, Legg Mason, Inc. LM, SYNNEX Corp. SNX and American International Group, Inc. AIG. Price-to-Book Value Stocks to Buy in July In value investing, it is a common practice to pick stocks that are cheap but fundamentally strong. There are a number of investment styles to suit the predilection of hundreds of investors looking for the best value stocks. Among them, price-to-book ratio (P/B ratio) is an easy-to-use tool for identifying low-priced stocks, which have high growth prospects. The P/B ratio is used to calculate how much an investor needs to pay for each dollar of book value of a stock. It is calculated by dividing the current closing price of the stock by the latest quarter's book value per share. P/B ratio = market capitalization/book value of equity. What is Book Value? There are several ways by which book value can be defined. Book value is the total value that would be left over, according to the company’s balance sheet, if it goes bankrupt immediately. In other words, this is what shareholders would theoretically receive if a company liquidates all its assets after paying off its liabilities. It is calculated by subtracting total liabilities from the total assets of a company. In most cases, this equates to the common stockholders’ equity on the balance sheet. However, depending on the company’s balance sheet, intangible assets should also be subtracted from the total assets to determine book value. Understanding P/B Ratio By comparing the book value of equity to its market price, we get an idea of whether a company is under- or overpriced. However, like P/E or P/S ratio, it is always better to compare P/B ratios within industries. A P/B ratio less than one means that the stock is trading at less than its book value, or the stock is undervalued and therefore a good buy. Conversely, a stock with a ratio greater than one can be interpreted as being overvalued or relatively expensive. Story continues For example, a stock with a P/B ratio of 2 means that we pay $2 for every $1 of book value. Thus, the higher the P/B, the more expensive the stock. But there is a caveat. A P/B ratio less than one can also mean that the company is earning weak or even negative returns on its assets, or that the assets are overstated, in which case the stock should be shunned because it may be destroying shareholder value. Conversely, the stock’s price may be significantly high — thereby pushing the P/B ratio to more than one — in the likely case that it has become a takeover target, a good enough reason to own the stock. Moreover, the P/B ratio isn't without limitations. It is useful for businesses — like finance, investments, insurance and banking or manufacturing companies — with many liquid/tangible assets on the books. However, it can be misleading for firms with significant R&D expenditure, high debt, service companies or those with negative earnings. In any case, the ratio is not particularly relevant as a standalone number. One should analyze other ratios like P/E, P/S and debt to equity before arriving at a reasonable investment decision. For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/436991/6-pricetobook-value-stocks-to-buy-in-july Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. About Screen of the Week Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use. Strong Stocks that Should Be in the News Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year. See these high-potential stocks free >>. Follow us on Twitter: https://twitter.com/zacksresearch Join us on Facebook: https://www.facebook.com/ZacksInvestmentResearch Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates. Contact: Jim Giaquinto Company: Zacks.com Phone: 312-265-9268 Email: pr@zacks.com Visit: www.Zacks.com Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer. Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release. 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 SYNNEX Corporation (SNX) : Free Stock Analysis Report Legg Mason, Inc. (LM) : Free Stock Analysis Report American International Group, Inc. (AIG) : Free Stock Analysis Report Party City Holdco Inc. (PRTY) : Free Stock Analysis Report JinkoSolar Holding Company Limited (JKS) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research
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Audrey Fillon hit and killed by truck
Devon and Cornwall Police are calling for witnesses to come forward. (SWNS) A teenage girl who was killed by a pick-up truck on the way home from her school prom has been pictured for the first time. Audrey Fillon, 16, was returning home after celebrating the end of her GCSEs with her peers when she was struck by a Nissan pick-up truck in the early hours of Friday June 28. Her family have released a picture of Audrey as tributes continue to be paid to the teenager. The Braunton Academy pupil had spent the evening at Barnstaple Hotel which hosts the schools annual prom. Audrey Fillon - one friend has described the incident as "truly heartbreaking", (SWNS) The event was attended by 95 pupils who enjoyed a non-alcoholic drinks arrival followed by a two-course meal and then a disco. One friend said: "What an absolutely devastating end to such a momentous evening in a young girls life. Truly heartbreaking." It is understood the driver of the pick-up truck has been spoken to by police but has not been arrested. Devon and Cornwall Police said: "Her next of kin have been informed and request privacy at this difficult time. "Police would like to hear from anyone who was in the area during the time of the incident as they could hold information that could assist with the investigation." Emergency services at the spot on the A361 where a 16 year old was knocked down and killed. (SWNS) Condolences have come from Barnstaple Hotels group HR manager Andrew Mosedale. He said: Our condolences go to the family. We have done some checking and the young lady was at the prom for the whole thing which finished at 11pm. "We dont know what happened after that or what provisions were made to get themselves away and back to their homes." Others left messages of condolence to the family for a 'beautiful daughter'. Anyone with information should contact 101@dc.police.uk quoting log number 40 for 28 June. Watch the latest videos from Yahoo UK View comments
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The Zacks Analyst Blog Highlights: Nordstrom, Kohl's, Macy's, Simon Property and Planet Fitness
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Nordstrom, Inc. JWN, Kohl's Corp. KSS, Macy's, Inc. M, Simon Property Group Inc. SPG and Planet Fitness, Inc. PLNT.
Here are highlights from Tuesday’s Analyst Blog:
Retail Bankruptcies Soar: E-Sports, Gym Chains to the Rescue
Despite a relatively healthy U.S. economy with record-busting equity market performance by benchmark indices, an alarming trend of rising brick-and-mortar store closures has hogged the limelight in the retail space. Dwindling sales by several underperforming stores have led to a surge in retail sector bankruptcies, threatening the sustainability of real estate properties that primarily cater to malls and shopping complexes.
As the mall landlords seek alternative options to replace lost tenants, esports and gym chains have emerged as saviors, gobbling up the vacant spaces and helping the beleaguered properties to remain relevant to customers. Before we tread on these uncharted territories, let us dig a little deep into the seemingly closed chapters of the retail sector.
Brick-and-Mortar Retail Stores on the Wane
In 2018, the retail sector reportedly witnessed 5,864 store closures as low customer footfall generated soft turnover, rendering most brick-and-mortar stores financially unviable. With online shopping fast becoming the preferred mode of transaction, about 5,994 store closures are in the cards this year as retail sector bankruptcies are piling up. Notably, online shopping is likely to swell from 16% of retail sales at present to 25% by 2026, bringing on the chopping block an estimated 75,000 stores.
Various specialty retailers and discount stores such as Payless, Gymboree, Charlotte Russe and Shopko have filed for bankruptcies this year with a combined store closure of 3,720. Department stores like Nordstrom, Inc., Kohl's Corp. and Macy's, Inc. have reduced their store footprint as the battle for survival become murkier with intense price wars.
Reinventing Malls for Higher Customer Connect
With increasing vacancy, mall owners were forced to reinvent malls to cover the operational and real estate costs by engaging tenants who encouraged more customer connect and social interaction. Leading by example, Simon Property Group Inc. – the largest publicly traded retail real estate firm with a diverse portfolio of shopping malls – has taken recourse to esports to transform its shopping centers into in-game locations.
Esports, a billion-dollar business, has fast emerged as the latest craze among sporting buffs with engaging content and challenges. Simon intends to capitalize on this trend and has collaborated with entertainment firm Allied Esports to create 10,000- to 15,000-square-foot esports lounges for competitive video game events. The events are likely to generate additional sales opportunities for niche entertainment categories, food, drink, apparels and accessories, bringing a fresh lease of life to the struggling retail destinations.
Gym Chains Drive Additional Customer Traffic
In addition to esports, gym chains and fitness centers have lent support to increase mall occupancy, and cashed in on the increased health awareness of U.S. customers. A case in point is Planet Fitness, Inc. that aims to open about 225 gyms this year. With a tally of 1,800 gym centers across the country, Planet Fitness has been on growth streak in recent years with majority of its new gyms cropping up in locations that were vacated by retailers like Toys "R" Us. In the past three years, this fitness chain recorded a stellar return of 280.9%, making it is one of the hottest stocks in retail space.
Mall owners are increasingly preferring gyms and grocery stores as they increase customer footfall even on weekdays when it is often tough to draw physical traffic. Moreover, customers often tend to combine their gym visits with shopping to save time and shop either before or after their workouts. Per data from real estate firm CoStar Group, the number of gym tenants in shopping centers has more than doubled over the past decade to more than 14,000 last year.
Time to flex muscles? Game on.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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 reportPlanet Fitness, Inc. (PLNT) : Free Stock Analysis ReportNordstrom, Inc. (JWN) : Free Stock Analysis ReportKohl's Corporation (KSS) : Free Stock Analysis ReportMacy's, Inc. (M) : Free Stock Analysis ReportSimon Property Group, Inc. (SPG) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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AUD/USD Price Forecast – Australian dollar runs into resistance
The Australian dollarhas rallied a bit during the trading session on Wednesday, reaching towards the top of the bullish and golfing candlestick from Monday that was so impressive. At this point, it looks as if we are failing though, especially on smaller time frames. I suspect at this point we will probably try to go below the 0.70 level and bounced back and forth. Ultimately, this is a market that will be very sensitive to the risk appetite of traders around the world, as the Australian dollar is so highly levered to China. I think at this point it’s a little bit difficult to get overly bullish but clearly the last couple of days have been rather interesting.
I believe that between now and the jobs number we will probably continue to bounce around in this area, unless of course we get some type of headline involving the Americans and Chinese. Ultimately, Australian dollar traders pay quite a bit of attention to China, so at this point that will be the biggest driver. The jobs number on Friday will have its effect as well, but at this point it’s very likely that it’s going to be choppy over the next 36 hours or so.
If we do break above the 0.7060 level, then at that point I would consider this pair to be breaking out, and more than likely to go towards the 0.7250 level. To the downside, the 0.6950 level is support, but if we can break down below there it’s likely that the market goes down to the 0.69 handle after that.
Please let us know what you think in the comments below
Thisarticlewas originally posted on FX Empire
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Calculating The Intrinsic Value Of UniFirst Corporation (NYSE:UNF)
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In this article we are going to estimate the intrinsic value of UniFirst Corporation (NYSE:UNF) by taking the expected future cash flows and discounting them to their present value. This is done using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model.
View our latest analysis for UniFirst
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars:
[{"": "Levered FCF ($, Millions)", "2020": "$134.0m", "2021": "$151.0m", "2022": "$157.2m", "2023": "$163.1m", "2024": "$168.7m", "2025": "$174.1m", "2026": "$179.4m", "2027": "$184.7m", "2028": "$190.1m", "2029": "$195.5m"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x1", "2021": "Analyst x1", "2022": "Est @ 4.14%", "2023": "Est @ 3.71%", "2024": "Est @ 3.42%", "2025": "Est @ 3.21%", "2026": "Est @ 3.07%", "2027": "Est @ 2.97%", "2028": "Est @ 2.9%", "2029": "Est @ 2.85%"}, {"": "Present Value ($, Millions) Discounted @ 7.5%", "2020": "$124.7", "2021": "$130.7", "2022": "$126.6", "2023": "$122.1", "2024": "$117.5", "2025": "$112.8", "2026": "$108.2", "2027": "$103.6", "2028": "$99.2", "2029": "$94.9"}]
("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= $1.1b
We now need to calculate the Terminal Value, which accounts for all the future cash flows after this ten year period. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 10-year government bond rate of 2.7%. We discount the terminal cash flows to today's value at a cost of equity of 7.5%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$196m × (1 + 2.7%) ÷ (7.5% – 2.7%) = US$4.2b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$4.2b ÷ ( 1 + 7.5%)10= $2.04b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $3.18b. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of $167.04. Compared to the current share price of $188.51, the company appears around fair value at the time of writing. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at UniFirst as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 7.5%, which is based on a levered beta of 0.800. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Whilst important, DCF calculation shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For UniFirst, There are three pertinent aspects you should look at:
1. Financial Health: Does UNF have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does UNF's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of UNF? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Jon Stewart in Attendance for Funeral of 9/11 Hero Luis Alvarez
Comedian Jon Stewart hugs an NYPD officer as U.S. Rep. Carolyn Maloney (D-NY) looks on, at the funeral of Luis Alvarez, a former New York City police detective who was diagnosed with cancer after working at Ground Zero, in New York, U.S., July 3, 2019. REUTERS/Shannon Stapleton Former "Daily Show" host and activist Jon Stewart attended the funeral Wednesday for 9/11 first-responder Luis Alvarez, who died Saturday due to health complications from months spent at the World Trade Center site. RIP Detective Luis Alvarez, loyal to the NYPD, protector of 9/11 first responders. Funeral mass will be here in Astoria, Queens. Arriving now: fellow policemen, actor and activist Jon Stewart #NBC4NY pic.twitter.com/ImjRI9wTuO Katherine Creag (@katcreag4NY) July 3, 2019 Alvarez Pleaded With Congress Just Last Month Alvarez, a retired NYPD bomb squad detective, was on Capitol Hill in June pleading with Congress to keep the September 11 Victim Compensation Fund replenished. WASHINGTON, DC - JUNE 11: Former Daily show host Jon Stewart, right speaks to Retired New York Police Department detective and 9/11 responder Luis Alvarez , front left, and FealGood Foundation co-founder John Feal, back left, during a House Judiciary Committee hearing on reauthorization of the September 11th Victim Compensation Fund on Capitol Hill on June 11, 2019 in Washington, DC. (Photo by Zach Gibson/Getty Images) The fund is set to expire next year, according to TMZ, which adds that Alvarez' goal was to make sure Congress continued to help first responders. K9s also lined up for Luis Alvarez who was a detective in the NYPD Bomb Squad pic.twitter.com/dM6zdgN9ug Miguel Marquez (@miguelmarquez) July 3, 2019 Stewart Continues His Activism Stewart, who was next to Alvarez during that much-publicized meeting with Congress, admonished the panel for not doing enough for 9/11 survivors. The Hill says Alvarez was 53 when he died after fighting colon cancer for three years. Story continues The Hill adds that a wake was held in Long Island on Tuesday. Alvarez: 'I Will Not Stand By' "I will not stand by and watch as my friends with cancer from 9/11, like me, are valued less than anyone else because of when they get sick, they die," Alvarez was quoted as saying to Congress. Jon Stewart Attends Funeral of 9/11 First Responder and Hero Luis Alvarez https://t.co/zeNu2LZK0Q TMZ (@TMZ) July 3, 2019 Alvarez had spoken before Congress several times while he was sick to make sure the compensation fund continued to provide care for first-responders. Family Lawyer: He Won This Battle Now This writes that Matthew McCauley, the Alvarez' family lawyer, told the family that Alvarez had already done so much to help the victims of 9/11. "We told him at the end that he had won this battle by the many lives he had touched by sharing his three-year battle," McCauley said. Comedian Jon Stewart salutes as the casket of Luis Alvarez, a former New York City police detective who was diagnosed with cancer after working at Ground Zero, is carried into a church for his funeral in New York, U.S., July 3, 2019. REUTERS/Shannon Stapleton
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7 of the Best SPDR ETFs — Besides SPY and GLD
State Street’s(NYSE:STT) SPDR brand is one of the most recognizable brands in the ETF universe. With that superior brand recognition comes heft. As of June 26, SPDR is the third-largest U.S. ETF sponsor and has $642.6 billion in ETF assets under management. That is more than triple the amount of its next-largest peer.
In terms of sheer population, there are hundreds of SPDR ETFs, but among the issuer’s most well-known offerings are theSPDR S&P 500 ETF(NYSEARCA:SPY), the world’s largest ETF; theSPDR Gold Shares(NYSEARCA:GLD), the world’s largest gold-backed fund; and a the largest (by assets) lineup of sector ETFs, including theFinancial Sector Spider ETF(NYSEARCA:XLF).
SPDR ETFs span an array of asset classes, including stocks, bond, commodities and real estate, among others. Additionally,there are some inexpensiveSPDR ETFs, meaning frugal investors can find plenty of funds to embrace in the SPDR lineup.
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You probably already know about the likes of GLD and SPY, so let’s look at some other SPDR ETFs that may merit a place in your portfolio.
Source: Shutterstock
Expense ratio: 0.35% per year, or $35 on a $10,000 investment.
SPDR ETFs include several dividend funds and theSPDR S&P Dividend ETF(NYSEARCA:SDY) is one of the gems of the bunch. Home to $18.54 billion in assets under management, SDY is one of the largest dividend ETFs, but this SPDR ETF impresses on several other fronts, including its status as aclear quality play.
SDY targets the S&P High Yield Dividend Aristocrats and while that index overtly says “high yield” in its name, this SPDR ETF is a credible dividend growth play because the index requires member firms to have dividend increase streaks of at least 20 years. That is one of the longest such requirements among all dividend funds.
“Due to the index screen for 20 years of consecutively raising dividends, stocks included in the Index have both capital growth and dividend income characteristics, as opposed to stocks that are pure yield,”according to State Street.
SDY holds 112 stocks and allocates over a third of its combined weight to the industrial and financial services sectors.
Source: Shutterstock
Expense ratio: 0.35%
Speaking of the financial services sector, one of the best SPDR ETFs to consider over the near-term is theSPDR S&P Bank ETF(NYSEARCA:KBE). Unlike the aforementioned XLF, KBE is dedicated to bank stocks, meaning investors will not find diversified financial companies or property and casualty insurance providers in this SPDR ETF.
KBE is up nearly 16% year-to-date, an impressive resurgence after bank stocks languished in 2018. More good news for this SPDR ETF and rival bank funds emerged on June 28 following the completion of the Federal Reserve’s Comprehensive Capital Analysis and Review, or CCAR.
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To put things simply,the CCAR resultspave the way for many of the largest U.S. banks, including plenty of KBE components, to significantly boost dividends and share repurchase efforts. KBE yields just 2.11% so there is plenty of room for dividend growth with this SPDR ETF.
Source: Shutterstock
Expense ratio: 0.18%
Goldhas been a torrid pace, putting the spotlight on related ETFs, including theSPDR Gold MiniShares Trust(NYSEARCA:GLDM). A simple way of looking at this SPDR ETF is that it is the cost-effective counterpart to the aforementioned GLD.
“Shares of GLDM are designed for investors who want a cost-effective and convenient way to invest in gold and will be offered on a continuous basis,”according to State Street.
In late June, GLDM celebrated its first birthday and the SPDR ETF has more than $788 million in assets under management, indicating investors like a good deal with gold ETFs, too.
With the Federal Reserve poised to lower interest rates and the dollar already weakening, this SPDR ETF could continue surging over the near term.
Source: Shutterstock
Expense ratio: 0.11%
With $2.74 billion in assets under management, theSPDR Portfolio Emerging Markets ETF(NYSEARCA:SPEM) is not a small SPDR ETF, but it is overlooked relative to some other emerging markets ETFs offered by rival issues. That said, SPEM has at least one thing going for it: currently, it is the cheapest emerging markets ETF available in the U.S.
SPEM offers broad, cost-effective emerging markets exposure as it holds 1,542 stocks from nearly 30 countries. Investors should note South Korean stocks are not part of this SPDR ETF because SPEM tracks and S&P index and that index provider classifies South Korea as a developed market. China, Taiwan and India combine for about 59% of SPEM’s geographic exposure.
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Due to the lack of South Korea exposure, investors should expect SPEM to generate significantly different returns over the long-term than the MSCI Emerging Markets Index. This SPDR ETF has adequate exposure to growth sectors with communication services and consumer discretionary names combining for about a quarter of the fund’s roster.
Source: Shutterstock
Expense ratio: 0.40%
SPDR ETFs featured an extensive lineup of fixed funds, including some productswith niche focuses. For its part, theSPDR Bloomberg Barclays Convertible Securities ETF(NYSEARCA:CWB) is the dominant name among convertible bond ETFs and index funds.
In the fixed income space, convertibles are one of the segments with high correlations to equities because convertible bonds can be converted into common stock of the underlying issuer. With that in mind, it is not surprising to see CWB perform well when equities are doing the same.
Though this point may be rendered moot over the near-term because the Fed could lower interest rates, long-term investors may want to consider CWB because convertible bonds often outperform other fixed income assets when interest rates rise. Due to its upside linkage to equities, that is CWB’s primary form of investor compensation, meaning the fund is a lower yielder compared to traditional corporate bond ETFs.
Source: Shutterstock
Expense ratio: 0.35%
TheSPDR S&P Biotech ETF(NYSEARCA:XBI) is one of the most popular biotech ETFs and sets itself apart in a crowded field by being an equal-weight, not a cap-weighted fund. This SPDR ETF’s 119 holdings have a weighted average market value of $10.3 billion, indicating this is primarily a mid-cap fund.
XBI’s weighting methodology leads to vastly different returns relative to its cap-weighted rivals. While the tilt to smaller stocks makes this SPDR ETF more volatile than cap-weighted biotech funds, XBI has outperformed the Nasdaq Biotechnology Index by a margin of better than 2-to-1 over the past three years.
This SPDR ETF is up nearly 20% year-to-date and some market observers see more upside coming for biotechnology stocks and ETFs.
• 7 Stocks on Sale the Insiders Are Buying
“In the last month this group has actually been the best-performing sector of any of the major groups,” said Newton Advisors technical analyst Mark Newton in aninterview with CNBC. “Just in the last couple of weeks, you’ve seen this entire downtrend since late last year be broken in health care relative to the S&P,” he said of a trendline stretching from its peak in December to mid-May.”
Source: Shutterstock
Expense ratio: 0.45%
TheSPDR S&P International Dividend ETF(NYSEARCA:DWX) is over 11 years old and has nearly $833 million in assets under management, so this SPDR ETF is neither new nor small, but it can be overlooked. Still, DWX is a practical option for investors looking for exposure to high dividend ex-US stocks.
This SPDR ETF “seeks to provide exposure to the 100 highest yielding international common stocks that have passed certain sustainability and earnings growth screens,”according to State Street.
DWX is a focused fund with just 97 holdings, but its dividend yield of 4.03% is more than double that of the S&P 500. Up nearly 13% year-to-date, DWX is outperforming the MSCE EAFE Index by about 100 basis points.
DWX provides exposure to 20 countries, three of which are developed markets, but Canada and Australia combine for almost 34% of the fund’s weight.
Todd Shriber owns shares of XLF.
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The post7 of the Best SPDR ETFs — Besides SPY and GLDappeared first onInvestorPlace.
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TOP RANKED ROSEN LAW FIRM: Announces Securities Class Action Lawsuit Against Nabriva Therapeutics plc; IMPORTANT JULY 8 DEADLINE - NBRV
NEW YORK, NY / ACCESSWIRE / July 3, 2019 / Rosen Law Firm, a global investor rights law firm, announces the filing of a class action lawsuit on behalf of purchasers of the securities of Nabriva Therapeutics plc ( NBRV ) from November 1, 2018 through April 30, 2019, inclusive (the "Class Period"). The lawsuit seeks to recover damages for Nabriva investors under the federal securities laws. If you wish to serve as lead plaintiff, you must move the Court no later than July 8, 2019. To join the Nabriva class action, go to http://www.rosenlegal.com/cases-register-1567.html or call Phillip Kim, Esq. or toll-free at 866-767-3653 or email pkim@rosenlegal.com or cases@rosenlegal.com for information on the class action. NO CLASS HAS YET BEEN CERTIFIED IN THE ABOVE ACTION. UNTIL A CLASS IS CERTIFIED, YOU ARE NOT REPRESENTED BY COUNSEL UNLESS YOU RETAIN ONE. YOU MAY RETAIN COUNSEL OF YOUR CHOICE. YOU MAY ALSO REMAIN AN ABSENT CLASS MEMBER AND DO NOTHING AT THIS POINT. AN INVESTOR'S ABILITY TO SHARE IN ANY POTENTIAL FUTURE RECOVERY IS NOT DEPENDENT UPON SERVING AS LEAD PLAINTIFF. According to the lawsuit, defendants throughout the Class Period made false and/or misleading statements and/or failed to disclose that: (1) Nabriva's manufacturers failed to meet good manufacturing practices; (2) these manufacturers would be subject to inspections by the U.S. Food and Drug Administration ("FDA") in connection with Nabriva's New Drug Application ("NDA"); (3) as a result of the manufacturing deficiencies, Nabriva's NDA for CONTEPO was unlikely to be approved by the FDA; and (4) as a result, Nabriva's public statements were materially false and misleading at all relevant times. When the true details entered the market, the lawsuit claims that investors suffered damages. A class action lawsuit has already been filed. If you wish to serve as lead plaintiff, you must move the Court no later than July 8, 2019. A lead plaintiff is a representative party acting on behalf of other class members in directing the litigation. If you wish to join the litigation, go to http://www.rosenlegal.com/cases-register-1567.html or to discuss your rights or interests regarding this class action, please contact Phillip Kim, Esq. of Rosen Law Firm toll free at 866-767-3653 or via e-mail at pkim@rosenlegal.com or cases@rosenlegal.com . Story continues Follow us for updates on LinkedIn: https://www.linkedin.com/company/the-rosen-law-firm , on Twitter: https://twitter.com/rosen_firm or on Facebook: https://www.facebook.com/rosenlawfirm/ . Rosen Law Firm represents investors throughout the globe, concentrating its practice in securities class actions and shareholder derivative litigation. Rosen Law Firm was Ranked No. 1 by ISS Securities Class Action Services for number of securities class action settlements in 2017. The firm has been ranked in the top 3 each year since 2013. Rosen Law Firm has secured hundreds of millions of dollars for investors. Attorney Advertising. ------------------------------- Contact Information: Laurence Rosen, Esq. Phillip Kim, Esq. The Rosen Law Firm, P.A. 275 Madison Avenue, 34 th Floor New York, NY 10016 Tel: (212) 686-1060 Toll Free: (866) 767-3653 Fax: (212) 202-3827 lrosen@rosenlegal.com pkim@rosenlegal.com cases@rosenlegal.com www.rosenlegal.com SOURCE: Rosen Law Firm View source version on accesswire.com: https://www.accesswire.com/550750/TOP-RANKED-ROSEN-LAW-FIRM-Announces-Securities-Class-Action-Lawsuit-Against-Nabriva-Therapeutics-plc-IMPORTANT-JULY-8-DEADLINE--NBRV
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The Zacks Analyst Blog Highlights: TopBuild, Construction Partners, Great Lakes Dredge & Dock, KBR and Eagle Materials
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: TopBuild BLD, Construction Partners ROAD, Great Lakes Dredge & Dock GLDD, KBR KBR and Eagle Materials EXP.
Here are highlights from Tuesday’s Analyst Blog:
Winning Construction Stocks with Room to Build
The first half of 2019 was dynamic for the construction market. After a sharp selloff in the second half of 2018, rising demand, declining mortgage rates and solid economic fundamentals took most of the sting out of this hostile situation.
The construction sector grew almost 25% in the first six months of 2019, higher than the broader market’s (S&P 500) rally of 16.1%. Increased infrastructure spending, mainly in non-residential areas, along with the Fed’s dovish stance, ongoing job growth and rising wages, is contributing to the gradual improvement in marketplace.
Notably, spending grew in double digits in areas like highway and street, sewage and water disposal, transportation, water supply, and manufacturing during the first five months of 2019. Meanwhile, although residential outlays remained in a soft patch as home building fell for the fifth straight month in May, per the latest Commerce Department report, the only positive is new multi-family homes spending, which was up 9.3% during the period.
Insights Into Sector’s Prospects for 2H
After GDP growth of 2.9% in 2018, U.S. economic growth is expected to shift to lower gear at a 2.1% pace in 2019, according to Fed projections. GDP advanced at a 3.1% annualized rate in the first quarter, driven by a large increase in inventories of unsold goods and an improved trade balance, neither of which is expected to be repeated. The U.S. economy is expected to grow at a 1.5% annualized rate in the second quarter, the Atlanta Federal Reserve’s GDPNow forecast model showed on Jul 1.
Indeed, the construction market, the fate of which is tied to broader economic growth, is expected to suffer thanks to rising raw material costs, a weak housing market and a slowdown in global economy. Meanwhile, trade tensions with China and Mexico have been upsetting businesses and dampened consumer confidence.
Nonetheless, the truce in trade war is a boon to the construction market. In a tentative plan to end the trade war, President Donald Trump de-escalated the ongoing trade war with China on Jun 29 at the G20 summit in Japan, where he announced that the United States would not be adding the planned 25% tariffs on $300 billion worth of Chinese goods.
Also, the Fed recently signaled that it will cut interest rates if damage from President Trump’s trade battles with China and Europe, slowing global growth and geopolitical tensions threaten to curtail the U.S. economy further.In a nutshell, lower interest/mortgage rates along with steady job and wage growth is expected to drive the construction sector. Although spending on residential construction has been weak for a number of months, builders are hopeful that declining mortgage rates will spur a rebound.
Construction Stocks that Led the Way
The positive developments led to a few winners in the construction equity space in the first half of 2019 that not only crushed the broad market returns, but also have the potential to outperform in the latter part. Of these, we have selected seven stocks with the help of our Zacks Stock Screener that have a Zacks Rank #1 (Strong Buy) or 2 (Buy), justifying their strong fundamentals. These are, namely, TopBuild, Construction Partners, Great Lakes Dredge & Dock, KBR and Eagle Materials, among others.
As per the Zacks Sector Rank, the Zacks Construction sector is currently #2 out of 16 (top 14%), mirroring analysts’ optimism on the market’s earnings growth potential.
A solid sector rank and a VGM Style Score of B or better is quite a combination to look out for in stocks, especially for investors beefing up their portfolio in the second half amid volatility and uncertainty. You can seethe complete list of today’s Zacks #1 Rank stocks here.This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated+98%,+119%and+164%gains in as little as 1 month.
Click here to see these breakthrough stocks now >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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 reportTopBuild Corp. (BLD) : Free Stock Analysis ReportEagle Materials Inc (EXP) : Free Stock Analysis ReportGreat Lakes Dredge & Dock Corporation (GLDD) : Free Stock Analysis ReportKBR, Inc. (KBR) : Free Stock Analysis ReportConstruction Partners, Inc. (ROAD) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Euro ETF Could Sag Some More
This article was originally published onETFTrends.com.
TheInvesco CurrencyShares Euro Currency Trust (FXE) is off nearly 2% year-to-date and some foreign currency market observers see more downside ahead for the common currency.
Recently, European Central Bank (ECB) President Mario Draghi indicated the ECB will keep an easy monetary policy in place longer than many investors expected. That could be all the motivation forex traders need to hammer the euro.
“The same day that Draghi hinted at a possible eurozone rate cut (unfairly or not, depending upon your portfolio allocation), FXE sank to a new low for the month of June -- the lowest intraday level since its June 3 opening bull gap,”according to Schaeffer's Investment Research.
Looking ahead, new data may continue to drag on the Eurozone currency. For instance, the Commerce Department recently revealed a strong first quarter U.S. economic expansion, which should help reassure investors about the growth trajectory in the U.S. and further help prop up demand for greenbacks.
Added Uncertainty
But since that immediate post-Draghi slide in shares of the exchange-traded fund (ETF), FXE has snapped back quickly -- and even taken out resistance at its 160-day moving average in the process, which it's now re-testing as support. (For longer-term chart watchers, this daily trendline roughly corresponds with the 32-week moving average), according to Schaeffer's.
Additionally, some warn that political risks like the prolonged Brexit and the coming European Union elections could further add to uncertainty over the euro.
Draghi said ECB policy makers would consider in the weeks ahead how to adapt their policy tools “commensurate to the severity of the risk” to the economic outlook, which leaves open the option to extend the time frame before the next interest-rate increase, a reduction in the already negative policy rate or restarting bond purchases. Still, historical data indicate FXE could be a decent performer this month.
FXE “averages a return of 0.71% for July, placing the calendar period behind only April (1.07%) and June (0.74%) in terms of monthly performance. That's based on the last 10 years' worth of data, during which FXE has ended July higher on six occasions,” notes Schaeffer's.
For more information on the foreign exchange markets, visit ourcurrency ETFs category.
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Should You Worry About Maple Leaf Foods Inc.'s (TSE:MFI) CEO Pay?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
Michael McCain has been the CEO of Maple Leaf Foods Inc. (TSE:MFI) since 1999. 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. The aim of all this is to consider the appropriateness of CEO pay levels.
View our latest analysis for Maple Leaf Foods
At the time of writing our data says that Maple Leaf Foods Inc. has a market cap of CA$3.5b, and is paying total annual CEO compensation of CA$6.7m. (This is based on the year to December 2018). While we always look at total compensation first, we note that the salary component is less, at CA$1.1m. When we examined a selection of companies with market caps ranging from CA$2.6b to CA$8.4b, we found the median CEO total compensation was CA$4.0m.
It would therefore appear that Maple Leaf Foods Inc. pays Michael McCain more than the median CEO remuneration at companies of a similar size, in the same market. However, this fact alone doesn't mean the remuneration is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business.
You can see a visual representation of the CEO compensation at Maple Leaf Foods, below.
On average over the last three years, Maple Leaf Foods Inc. has grown earnings per share (EPS) by 3.7% each year (using a line of best fit). Its revenue is up 1.6% over last year.
I'm not particularly impressed by the revenue growth, but it is good to see modest EPS growth. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. You might want to checkthis free visual report onanalyst forecastsfor future earnings.
Maple Leaf Foods Inc. has not done too badly by shareholders, with a total return of 9.5%, over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size.
We examined the amount Maple Leaf Foods Inc. pays its CEO, and compared it to the amount paid by similar sized companies. We found that it pays well over the median amount paid in the benchmark group.
Over the last three years returns to investors have been uninspiring, and we would have liked to see stronger business growth. In conclusion we think the company should definitely focus on improving the business before awarding any large pay rises. So you may want tocheck if insiders are buying Maple Leaf Foods shares with their own money (free access).
Arguably, business quality is much more important than CEO compensation levels. So check out thisfreelist of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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The Zacks Analyst Blog Highlights: JPMorgan, Thermo Fisher, Broadcom, Marriott and Global Payments
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: JPMorgan JPM, Thermo Fisher TMO, Broadcom AVGO, Marriott MAR and Global Payments GPN.
Here are highlights from Tuesday’s Analyst Blog:
Top Stock Reports for JPMorgan, Thermo Fisher and Broadcom
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including JPMorgan, Thermo Fisher and Broadcom. These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
You can seeall oftoday’s research reports here >>>
JPMorgan’s shares have gained +6.1% in the past three months, outperforming the Zacks Major Regional Banks industry’s increase of +3.5%. It has an impressive earnings surprise history, having surpassed expectations in three of the trailing four quarters.
The Zacks analyst thinks improving loan balance, strong balance sheet (reflected by capital plan approval), branch openings in new markets and focus on strengthening credit card business will support the bank's financials. Expanding its reach into the lucrative U.S. healthcare payments market with a deal to acquire InstaMed will aid profitability.
However, dismal mortgage banking performance, mainly due to lower origination volumes and increasing competition is expected to continue hampering fee income growth. The company's dependence on capital markets revenues makes us wary and is expected to hurt revenue growth to some extent.
Shares ofThermo Fisherhave outperformed the Zacks Medical Instruments industry in the past three months (+6.1% vs. +2.3%). The Zacks analyst thinks Thermo Fisher has recently been demonstrating strength in all end markets categorized by customer type or geography.
In the last-reported quarter, the company registered solid international performance with growth in Asia-Pacific including China. A series of product launches aided its performance. The company’s purchase of Brammer Bio in the field of Gene and Cell Therapy is another positive. Thermo Fisher’s Specialty Diagnostics business, even in the face of the recently-completed divestment of its anatomical pathology unit, holds immense potential.
The company's 2019 guidance looks encouraging. On the flip side, Thermo Fisher’s operating segments are being hurt by unfavorable business mix. Competitive headwinds and escalating costs are other threats.
Broadcom’s shares have underperformed the Zacks Electronics - Semiconductors industry over the past six months, gaining +24.6% vs. a +33.3% increase. Broadcom is a premier designer, developer and global supplier of a broad range of semiconductor devices. The Zacks analyst thinks the company is benefiting from strong demand for its wireless solutions and expanding product portfolio, which makes it well-positioned to address the needs of rapidly growing technologies like IoT and 5G.
Strong ties with leading OEMs across multiple target markets will help the company to gain key insights into the requirements of customers. Further, Broadcom is a leading player in the semiconductor market based on its multiple target markets, accretive acquisitions and strong cash flow.
However, the company has lowered its fiscal 2019 revenues outlook. Also, the company faces intensifying competition and integration risks due to frequent acquisitions. The company’s leveraged balance sheet and customer concentration continue to be headwinds.
Other noteworthy reports we are featuring today include Marriott and Global Payments.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119%and +164%gains in as little as 1 month.
Click here to see these breakthrough stocks now >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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 reportJPMorgan Chase & Co. (JPM) : Free Stock Analysis ReportBroadcom Inc. (AVGO) : Free Stock Analysis ReportThermo Fisher Scientific Inc. (TMO) : Free Stock Analysis ReportMarriott International (MAR) : Free Stock Analysis ReportGlobal Payments Inc. (GPN) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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The Zacks Analyst Blog Highlights: Approach Resources, Berry Petroleum, Panhandle Oil and Gas, Royal Gold and Kinross Gold
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Approach Resources, Inc. AREX, Berry Petroleum Corp. BRY, Panhandle Oil and Gas Inc. PHX, Royal Gold, Inc. RGLD and Kinross Gold Corp. KGC.
Here are highlights from Tuesday’s Analyst Blog:
OPEC Extends Output Cut to Boost Oil Prices: Winners & Losers
OPEC and its members have officially decided to extend production cut to shore up oil prices. The extension came at a time when U.S. production continues to rise and demand worries persist. Nonetheless, here’s a rundown on the OPEC production cuts’ big winners and losers —
Oil Prices Climb
Oil prices continue to edge up after OPEC and its allies agreed to extend supply cut by nine months. In electronic trading, West Texas Intermediate crude futures were up 18 cents at $59.27 a barrel, after hitting its highest level in over five weeks on Jul 1.
U.S. crude settled at $59.09 a barrel on the New York Mercantile Exchange, up 62 cents, or 1.1% in the last trading session. Dow Jones Market Data added that the front-month contract prices posted an eye-popping 9.3% gain in June.
Brent crude futures, by the way, were trading up 34 cents, or 0.5%, at $65.40 a barrel. The International benchmark increased 32 cents, or 0.5%, to settle at $65.06 a barrel on ICE Futures Europe on Jun 1.
OPEC Extends Production Cut
The production cut is till next March, a move particularly designed to put a check on oil prices falling on growing output. The United States, incidentally not a member of OPEC, continues to ramp up oil production at a fast clip. Needless to say, the boom in the Permian Basin has pushed the United States to the top spot as an oil producer.
Participating non-OPEC members also need to approve the agreement. And Russia, by far the most significant non-OPEC member, has given enough hints that it is willing to co-operate with the production cut.
During the Group of 20 leaders’ summit in Japan, Russian President Vladimir Putin said that both Russia and Saudi Arabia have decided to extend the oil production-reduction deal. Saudi Energy Minister Khalid al-Falih too confirmed that major alliances have “enthusiastically came together” to support the charter.
It’s worth pointing out that the alliance between Russia and OPEC does have a major hold in determining the world’s crude oil production. OPEC, individually, may control less than 50% of the world’s crude oil production but the coalition does exceed half of global oil production.
Growing U.S. Crude Production – Not the Only Concern
The demand outlook for global oil is bleak, which is also a reason for the OPEC production cut. The International Energy Agency confirmed that “a warm winter in Japan, a slowdown in the petrochemicals industry in Europe, and tepid gasoline and diesel demand in the United States” are all affecting world oil demand.
Analysts also believe that changes in modes of transportation, especially, rise of electric vehicles and government’s initiatives to reduce ill-effects on climate can easily dent demand for oil.
Energy Shares Gain
As demand for oil continues to scale, the energy sector is positioned to boost your portfolio. Most importantly, companies that are involved in hydraulic fracturing are poised to gain significantly. This is because a drop in oil price hurts their cost structure, killing the motive to pump. Thus, zeroing down on oil stocks poised to stand out as top investments for this year seems judicious.
Approach Resources, Inc.focuses on the acquisition, exploration, development, and production of unconventional oil reserves in the United States. The stock currently has a Zacks Rank #2 (Buy). The Zacks Consensus Estimate for its current-year earnings has moved 32% up in the past 60 days. The company’s expected earnings growth rate for the current year is 23.1% compared with the Oil and Gas - Exploration and Production - United States industry’s projected decline of 9.4%.
Berry Petroleum Corp.engages in the development and production of conventional oil reserves located in the western United States. The stock currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has risen 6.1% in the past 90 days. The company’s expected earnings growth rate for the current year is 23.8% compared with the Oil and Gas - Exploration and Production - United States industry’s projected decline of 9.4%.
Panhandle Oil and Gas Inc.acquires, develops, and manages oil and natural gas properties in the United States. The stock currently has a Zacks Rank #1 (Strong Buy). The Zacks Consensus Estimate for its current-year earnings has climbed 81% in the past 60 days. The company’s expected earnings growth rate for the current year is 138.2% compared with the Oil and Gas - Exploration and Production - United States industry’s estimated decline of 9.4%. You can seethe complete list of today’s Zacks #1 Rank stocks here.
Gold Edges Up
Gold prices are certainly expected to move north on higher oil prices. This is because as crude oil prices rise, prices of essential goods and commodities follow suit. And value of gold rises when inflation picks up. After all, it acts as a hedge against inflation. In fact, theoretically, more than 60% of the time gold and crude oil have a direct relationship. Given this bullishness, one should consider gold mining companies.
Royal Gold, Inc.acquires and manages precious metal streams, royalties, and related interests. The stock currently has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved 0.7% up in the past 60 days. The company, which is part of the Mining - Gold industry, is expected to record earnings growth of 23.4% in the current quarter.
Kinross Gold Corp.engages in the acquisition, exploration, and development of gold properties in the United States. The stock currently has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has climbed 8.3% in the past 60 days. The company’s expected earnings growth rate for the current year is 30% compared with the Mining - Gold industry’s projected rally of 15.8%.
Aviation, Refiners to Take a Hit
Aviation stocks traditionally have an inverse relationship with oil price. So, it isn’t surprising that shares of aviation firms will decline after a sharp rise in crude oil prices. After all, fuel costs are major part of the operating costs of aviation firms; thus rise in oil prices will hit profit margins.
Refineries also stand to lose from higher crude oil prices as crude is their raw material. So, refineries’ net cash flow declines when crude oil prices pick up.
This Could Be the Fastest Way to Grow Wealth in 2019
Research indicates one sector is poised to deliver a crop of the best-performing stocks you'll find anywhere in the market. Breaking news in this space frequently creates quick double- and triple-digit profit opportunities.
These companies are changing the world – and owning their stocks could transform your portfolio in 2019 and beyond. Recent trades from this sector have generated +98%, +119% and +164% gains in as little as 1 month.
Click here to see these breakthrough stocks now >>
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
https://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visithttps://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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 reportRoyal Gold, Inc. (RGLD) : Free Stock Analysis ReportKinross Gold Corporation (KGC) : Free Stock Analysis ReportApproach Resources Inc. (AREX) : Free Stock Analysis ReportBerry Petroleum Corporation (BRY) : Free Stock Analysis ReportPanhandle Royalty Company (PHX) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Is Milacron Holdings Corp.'s (NYSE:MCRN) ROE Of 8.2% Concerning?
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Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). By way of learning-by-doing, we'll look at ROE to gain a better understanding of Milacron Holdings Corp. (NYSE:MCRN).
Our data showsMilacron Holdings has a return on equity of 8.2%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 $0.082.
View our latest analysis for Milacron Holdings
Theformula for return on equityis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Milacron Holdings:
8.2% = US$44m ÷ US$537m (Based on the trailing twelve months to March 2019.)
Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is the capital paid in by shareholders, plus any retained earnings. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets.
ROE 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, 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. 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, Milacron Holdings has a lower ROE than the average (14%) in the Machinery industry classification.
That's not what we like to see. It is better when the ROE is above industry average, but a low one doesn't necessarily mean the business is overpriced. Still,shareholders might want to check if insiders have been selling.
Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same.
Milacron Holdings does use a significant amount of debt to increase returns. It has a debt to equity ratio of 1.54. While the ROE isn't too bad, it would probably be a lot lower if the company was forced to reduce 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 useful for comparing the quality of different businesses. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company.
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.
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Casino Stock Bears Could Double Their Money in 10 Days
A month ago, we profiledScientific Games Corp (NASDAQ:SGMS)and a flashingbearish signal. Following that June 4 write-up, the stock went on to slide more than 13% into its June 24 low close at $18.08. SGMS shares have since bounced back from those lows -- but heading into the Fourth of July holiday, another short-term sell signal is rearing its head, indicating it may be time to bet on the casino stock's next leg lower.
More specifically, the equity is running into resistance at its 40-day moving average, after a lengthy stretch below it. There have been five similar run-ups to this moving average in the last three years, after which SGMS stock was lower 10 days later by 11%, on average, per data from Schaeffer's Senior Quantitative Analyst Rocky White, with 100% of the returns negative.
At last check, Scientific Games stock was trading at $19.82, so another "average" pullback from this trendline resistance over the next two weeks would put the stock around $17.64 -- just south of its lows from May and June.
Another pullback would certainly have SGMS short sellers cheering. The 10.46 million shares sold short account for a healthy 19.3% of the stock's total available float, and 7.4 times the average daily trading volume. A technical rejection could encourage more of these bears to pile on, potentially creating additional headwinds.
Now is an opportune time to use put options to leverage a short-term slide in SGMS stock. The equity's Schaeffer's Volatility Index (SVI) of 51% is in the 4th percentile of its annual range, suggesting short-term options are pricing in relatively low volatility expectations for the underperformer.
In fact, if the SVI holds steady around its two-year average over the next couple of weeks, White's modeling shows that an at-the-money SGMS put option could potentially return 138% on another expected retreat from resistance at the 80-day moving average. In other words, prospective put buyers could more than double their money on a roughly 11% drop in the shares.
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China to Speed Up Pace of Opening Markets: Banks to Gain?
China plans to abolish all ownership limits for foreign firms in its financial sector by 2020, a year earlier than previously stated. The country is expected to further open its manufacturing sector, including the auto industry. Additionally, it will reduce its negative investment list that restricts foreign investment in some areas.This move comes after the Presidents of both China and the United States recently decided to resume trade negotiations, in an effort to sign a deal. The U.S.-China trade war-related tensions have been having an adverse impact on the economies of both countries for the past few months.In order to prop up growth internally, China has been taking some measures, of late. To aid credit growth (which has remained soft over the past few quarters) within the country, the People's Bank of China has already reduced the amount of cash that banks need to hold as reserve, six times since early 2018. Moreover, additional reductions in banks' reserve requirement ratios are likely to take place in the coming months.While these efforts have helped its financial markets to grow, China has not been able to achieve significant economic growth as of now. For a long time, companies in the United States and other countries have been complaining that Beijing has been blocking foreign access to its fast-growing financial markets. Due to the restrictions imposed on ownership, global investment banks’ expansion has been limited in China for the past few years.However, under the liberalized rules announced in 2017, China eased restrictions in its financial markets, allowing greater foreign participation. Indicating its readiness to allow greater access to global banks into the country’s financial markets, the China securities regulator allowed foreign companies to increase their stake to 51% in securities joint ventures, up from 49%.In response to this, many foreign investment firms have either set up new businesses onshore or expanded their presence through majority ownership in domestic joint ventures. Notably, JPMorgan JPM and Nomura Holdings Inc. NMR have already received regulatory nod for setting up brokerage joint ventures in China, while Citigroup C is planning to establish a majority-owned securities joint venture.Last December, UBS Group AG UBS became the first foreign bank to receive the regulator’s consent, since the rules on foreign investment in brokerages were announced in 2017.Furthermore, Morgan Stanley MS, which has two joint ventures in China — Morgan Stanley Huaxin Fund Management Co and a securities joint venture with Huaxin Securities — seeks to acquire majority ownership of one of these. Recently, the Chinese partner of Morgan Stanley’s securities joint venture said that it is ready to sell 2% stake and Morgan Stanley has until July 29 to submit a bid.
Thus, once foreign banks are allowed to conduct business in China without any restrictions, it will help these banks in expanding geographically, which will boost revenues. Moreover, the current global operating backdrop looks challenging. Once foreign firms establish and expand businesses in China, it is likely to further support their financials.Of the companies mentioned above, UBS Group AG and Citigroup currently carries a Zacks Rank #3 (Hold), while JPMorgan holds a Zacks Rank #2 (Buy). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Today's Best Stocks from ZacksWould you like to see the updated picks from our best market-beating strategies? From 2017 through 2018, while the S&P 500 gained +15.8%, five of our screens returned +38.0%, +61.3%, +61.6%, +68.1%, and +98.3%.This outperformance has not just been a recent phenomenon. From 2000 – 2018, while the S&P averaged +4.8% per year, our top strategies averaged up to +56.2% per year.See their latest picks free >>
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 reportCitigroup Inc. (C) : Free Stock Analysis ReportJPMorgan Chase & Co. (JPM) : Free Stock Analysis ReportUBS Group AG (UBS) : Free Stock Analysis ReportNomura Holdings Inc ADR (NMR) : Free Stock Analysis ReportMorgan Stanley (MS) : Free Stock Analysis ReportTo read this article on Zacks.com click here.
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The Zacks Analyst Blog Highlights: Universal Display, Hubbell, Issuer Direct, OSI Systems and Axalta Coating Systems
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Universal Display Corp. OLED, Hubbell Inc. HUBB, Issuer Direct Corp. ISDR, OSI Systems Inc. OSIS and Axalta Coating Systems Ltd. AXTA.
Here are highlights from Tuesday’s Analyst Blog:
5 Top Manufacturing Stocks to Buy Despite Soft Growth in June
The U.S. manufacturing sector maintained its growth in June albeit at a slow pace. Despite facing prolonged trade conflict with China, the largest trading partner of the country, and slowdown in global economy, the U.S. manufacturing sector managed to expand for 122 consecutive months.
Mixed ISM Manufacturing Data for June
On Jul 1, the Institute of Supply Management (ISM) reported that its index for U.S. manufacturing sector in June came in at 51.7. Although the reading fell below May’s reading of 52.1, it was better than the consensus estimate of 51.3. Notably, 12 out of the total 18 industries reported growth. Any reading above 50 indicates expansion of manufacturing activities.
On the positive side, the manufacturing employment index rose to 54.5 in June from 53.7 in May, indicating strong hiring by U.S. manufacturers. This reflects business confidence on the part of manufacturers despite lingering trade conflict with China, global economic slowdown and a rising U.S. dollar.
On the other hand, the new orders index declined to 50 from 52.7 in the prior month, raising questions on for future momentum. Moreover, the price paid by manufacturers dropped significantly to 47.9 in June from 53.2 in May, implying that inflation may remain muted in the near future.
U.S. Manufacturing Sector Still Best Globally
In a separate study, IHS Markit reported that U.S. manufacturing PMI rose 50.6 in June from 50.1 in May. This is a significant achievement given the fact that trade negotiations between the United States and China broke down abruptly in early May.
According to a report jointly developed by Caixin Media Co. and IHS-Markit, China’s manufacturing sector index fell to 49.4 in June from 50.2 in May. Furthermore, as per the National Bureau of Statistics of China, manufacturing PMI declined to 49.4 in June.
The IHS Markit Eurozone Manufacturing PMI came in at 47.6 in June 2019, slightly below the prior month’s estimate of 47.7. Within Eurozone, Germany continued to witness the biggest deterioration in manufacturing activities. Germany’s manufacturing PMI in June was just at 45. Moreover, the U.K.’s manufacturing PMI decreased to 48 from 49.4 in the prior month.
Therefore, it is clear that despite the slowdown in growth, the U.S. manufacturing sector is still the best globally. In addition, strong industrial production and core durable goods data of the United States in May also supports this view.
Likely Rate Cut by Fed to Boost U.S. Manufacturing
On Jun 25, in comments at the Council of Foreign Relations, Fed chairman Jerome Powell reiterated his dovish monetary stance declared in June FOMC minutes. Powell said that the downside risks to the U.S. economy have increased. Consequently, a growing number of Fed policymakers are looking for a rate cut.
Despite several policy tools applied by the Fed, inflation remains muted in 2019. PCE inflation declined to 1.5% in May from 1.6% in April. Core PCE inflation –- the Fed’s favorite inflation gauge – rose 1.6%, well below the central bank’s target rate of 2%.
Personal spending increased 0.4% in May compared with the revised estimate of an increase of 0.6% in April. Moreover, the ISM manufacturing price index suffered a significant drop in June.
All these parameters indicate a possible rate cut by the Fed in July in order to sustain U.S. economic expansion. A drop in interest rate will reduce the cost of funds thereby boosting investments in the manufacturing sector.
Our Top Picks
Considering the above-mentioned factors, we narrowed down our search to five manufacturing stocks with a strong growth potential. Each of these stocks sports a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.
Universal Display Corp.engages in the research, development and commercialization of organic light emitting diode technologies and materials for use in flat panel displays and solid-state lighting applications. The company has an expected earnings growth rate of 96.8% for the current year. The Zacks Consensus Estimate for the current year has improved 20.2% over the last 60 days.
Hubbell Inc.designs, manufactures, and sells electrical and electronic products in the United States and internationally. The company has an expected earnings growth rate of 11.3% for the current year. The Zacks Consensus Estimate for the current year has improved 0.2% over the last 60 days.
Issuer Direct Corp.helps companies produce and distribute their financial and business communications both online and in print. The company has an expected earnings growth rate of 19.3% for the current year. The Zacks Consensus Estimate for the current year has improved 3% over the last 60 days.
OSI Systems Inc.is a vertically integrated designer and manufacturer of specialized electronic systems and components for critical applications in the homeland security, healthcare, and defense and aerospace industries. The company has an expected earnings growth rate of 16.9% for the current year. The Zacks Consensus Estimate for the current year has improved 0.2% over the last 60 days.
Axalta Coating Systems Ltd.manufactures, markets, and distributes high performance coatings systems. It operates in two segments, Performance Coatings and Transportation Coatings. The company has an expected earnings growth rate of 35.2% for the current year. The Zacks Consensus Estimate for the current year has improved 0.6% over the last 60 days.
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Media Contact
Zacks Investment Research
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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 reportAxalta Coating Systems Ltd. (AXTA) : Free Stock Analysis ReportOSI Systems, Inc. (OSIS) : Free Stock Analysis ReportUniversal Display Corporation (OLED) : Free Stock Analysis ReportHubbell Inc (HUBB) : Free Stock Analysis ReportIssuer Direct Corporation (ISDR) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Ninja Chef high-speed blender is $50 off at Walmart
Twitter Facebook TL;DR: The powerful Ninja Chef high-speed blender is on sale for $109 at Walmart, saving you $50. We love a good combination appliance that does the work of two or three other appliances (or even nine in the case of some Instant Pots ). The Ninja Chef high-speed blender is both a blender and a food processor. You might be thinking that this stand-out blender will cost you a small fortune, but it’s actually pretty affordable as it’s on sale for $109 at Walmart, down from $159.99. The Ninja Chef is equipped with smart technology that gives it the perfect presets to make smoothies, soup, frozen drinks, ice cream, nut butter, and more. It comes with a 72-ounce mixing container and a 24-ounce double-walled tumbler cup for more personal and portable blends. Read more... More about Ninja , Food Processor , Blender , Mashable Shopping , and Kitchen Appliances
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Crude Oil Price Forecast – Crude oil markets bounced slightly on Wednesday
The WTI Crude Oil marketsinitially tried to drop after gapping higher on Wednesday in reaction to the extraordinarily bearish candle stick that formed on Tuesday. That being said, the candle stick on Tuesday was extraordinarily negative, and I do think that at this point we need to be looking for short-term selling opportunities near the 50 day EMA. The $57.50 level is an area that I think will cause some resistance, so any signs of exhaustion on a short-term chart in that area could be construed as an opportunity to short and go looking towards the $55 level. Alternately, if we were to break above the $57.50 level, then we could go looking towards the 200 day EMA at $59. One thing is for sure, global demand is not helping the situation so as long as the Americans and the Iranians don’t ratchet up tension, we should continue to see this market cool off a bit.
Brent marketsinitially gapped as well, turned around to find support and then bounced quite significantly. At this point, the market looks as if it is ready to try to rally a bit but I do think that the resistance above is going to be somewhat extreme. The $65 level is as high as we can get, a lease without some type of catalyst to go higher. I believe that the bottom of the range for the trading session on Wednesday is an area that being broken to the downside could unleash this market down to the $60 level. Overall, this is probably going to follow right along with WTI as per usual so watch both markets, and trade accordingly as they are indicators of each other.
Please let us know what you think in the comments below
Thisarticlewas originally posted on FX Empire
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Here's Why Shares of Goodyear Tire Bounced in June
Shares ofGoodyear Tire & Rubber(NASDAQ: GT)rallied 14.1% in June, according to data provided byS&P Global Market Intelligence, following a rare piece of good news in what has been an otherwise dismal year for auto suppliers.
It's been aturbulent year for automakers and their suppliers. Fears of a global slowdown, coupled with talk of trade restrictions between the U.S. and both China and Mexico, have led to weakness in the auto sector. Goodyear Tire was no exception to that trend, with the shares down 26% year to date even after a strong June and down as much as 35% for the year as recently as late May.
Image source: Getty Images.
Goodyear CEO Rick Kramer in Apriltold investorsif all proposed tariffs and levies against China were to go into effect, they would total 42% to 45% of the import price of tires coming in.
May was particularly tough on Goodyear due to the threats ofa new round of tariffs against Mexico, a major supplier to the auto sector, which led to a number of analyst downgrades or price target cuts of Goodyear stock.
The June rebound occurred primarily over the first few days of the month, as rhetoric between the U.S. and Mexico improved and the threat of new tariffs diminished. Goodyear rallied more than 11% on that news and held steady throughout the rest of the month.
The stock rallied as the prospect of the worst-case scenario, a trade war with Mexico, diminished, but the broader issues facing the auto industry, and Goodyear specifically, are far from over. Total auto sales appear to have plateaued, possibly indicating the start of a downward cycle, and economic conditions in much of the world are deteriorating. Although the U.S. has a temporary truce with China and pledges to continue negotiations instead of rushing new tariffs, there is not yet a deal between the countries.
The good news is that the case for panic selling Goodyear is now in the rearview mirror. But investors should think twice about buying in now hoping June's performance can be repeated in July.
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Lou Whitemanhas no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has adisclosure policy.
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Is There Another Big Acquisition for The Walt Disney Company (DIS) on the Horizon?
In newly-publishedBloomberg’s article,it was revealed thatGerber Kawasaki’sInvestment Advisor Representative, Nick Licouris, aspires forThe Walt Disney Company (NYSE:DIS)to expand its business by acquiringActivision Blizzard, Inc. (NASDAQ:ATVI).Gerber Kawasaki is an independent asset management firm with more than $859 million in assets under management. The fund held $4.12 million worth of stake in Activision Blizard, on the account of 90,490 shares, at the end of Q1 2019, whereas in The Walt Disney it reported a position that counted 152,587 shares outstanding with a value of $16.95 million.
Over the last 12 months, Activision Bizzard’s stock lost 37.84%, closing on June 2ndwith a price of $47.98 per share, which lead many investors into thinking the company is a good opportunity for a takeover at the moment. During the same time, Disney’s stock gained 36.03%, having a closing price of $142.53 on June 2nd.
According to the above-mentioned article, Nick Licouris believes Disney’s acquisition of Activision Blizzard could be a fantastic opportunity for Disney to expand its content by adding Activision Blizzard's flourishing e-sports business to its portfolio. With the gaming industry booming lately, and Activision Blizzard’s stock price declining, Nick Licouris finds now to be the right timing for a takeover.
This would definitely be a big investment for Disney, because in spite of declining Activision Blizzard’s stock price, the company has a market cap of $37.61 billion.
Disclosure:None.This article is originally published atInsider Monkey.
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Silver Price Forecast – Silver markets all over the place on Wednesday
Silver marketswent back and forth during the trading session after gapping higher on Wednesday, showing a clear range as to where the market wants to deal with. The $15.25 level underneath should be support, while the $15.50 level above should be resistance. That being the case, it makes a lot of sense that you should look towards extremist to play off of. Overall though, we are above the 200 day EMA so Silver should be somewhat bullish. Pay attention to the US dollar, because as it falls in strength it makes precious metals look much better.
Looking at the economic situation, we do see a lot of central banks out there looking to ease monetary policy, so quite frankly it makes sense that precious metals should continue to be in demand. Underneath, we have the 200 day EMA at the $15.16 level, and then of course the $15.00 level underneath which is the scene of a gap both offering support. If we can break above the $15.50 level, then the market should go looking towards the $16.00 level which has been my longer-term target. That being said, if we were to break down below the $15.00 level, then the market could very well go down to the $14.75 level, possibly the $14.50 level after that. Ultimately, this is a market that has quite a bit of strength underneath it, so I believe it’s only a matter time before the buyers come back in to pick up value.
Please let us know what you think in the comments below
Thisarticlewas originally posted on FX Empire
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The Zacks Analyst Blog Highlights: Kelly Services, NV5 Global, Limbach, MAXIMUS and First American Financial
For Immediate Release
Chicago, IL – July 3, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Kelly Services, Inc. KELYA, NV5 Global, Inc. NVEE, Limbach Holdings, Inc. LMB, MAXIMUS, Inc. MMS and First American Financial Corp. FAF.
Here are highlights from Tuesday’s Analyst Blog:
U.S. Threatens More Tariffs on EU Goods: 5 Big Gainers
In response to aircraft subsidies, the United States is now considering the implementation of additional tariffs on products from the European Union. This will for certain embitter trade relations with the bloc at a time when the United States has agreed on a truce with China.
With the stock market is expected to gyrate on new tariff moves, it will be prudent to invest in service-oriented companies that remain unperturbed by trade-related issues.
Trump Administration Proposes Tariffs on EU Goods
President Trump recently said that trade talks with China have resumed, which eventually helped the stock market gain traction. Trump added that “farmers are going to end up being the great beneficiary” as hostility between the world’s largest economies have ebbed and that their economic relations are improving.
But, trade woes between the United States and its trading partners are far from over. The Trump administration has now proposed an additional $4 billion in tariffs on EU goods to bend a 15-year disagreement over aircraft subsidiary.
The United States is contemplating levying tariffs on European products, including olives, Italian cheese, Scotch whiskey, and some 86 other tariff sub-categories. In fact, such tariffs in particular will almost double or even triple the cost of olive oil. The United States had proposed tariffs on $21 billion of European products in April.
Trade wars are certainly not encouraged as they impede economic growth and squeeze corporate profits. Lest we forget, a trade war with China had cost $7 trillion, while the U.S. tech sector was losing nearly $1.3 billion a month.
Service Firms Are Big Gainers
Service firms are safe bets for now. Such firms are unruffled by trade retaliations as they have less foreign sales exposure compared to goods companies. Service stocks also incur lower foreign input costs that might be subject to tariffs. Such input costs are mostly related to direct materials, labor and factory overheads.
The service wing of the U.S. economy by the way picked up in May, recovering from a 20-month low. According to the Institute for Supply Management (ISM), the non-manufacturing index (NMI) came in at 56.9 in May, topping analysts’ estimates of a slight dip to 55.4. It was also higher than April’s two-and-a-half-year low of 55.5.
The non-manufacturing sector, thus, saw uninterrupted expansion for the 112th consecutive month, indicating that the broader economy is on track for steady growth this year. After all, the non-manufacturing sector accounts for nearly 90% of the economy, while any reading above 50 indicates that the said sector is expanding.
Notably, 16 of the 18 non-manufacturing industries reported expansion, led by education services, transportation and warehousing, utilities, real estate, finance & insurance, healthcare, construction, mining, retail trade, and information.
5 Solid Choices
We have, thus, selected five solid service stocks that should make meaningful additions to your portfolio. These stocks flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum and the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Kelly Services, Inc.provides workforce solutions to various industries. The stock currently has a Zacks Rank #1 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved 4.3% up in the past 60 days. The company’s expected earnings growth for the current year is 7.9%, higher than the Staffing Firms industry’s projected rally of 3.7%.
NV5 Global, Inc.provides professional and technical engineering and consulting services to public and private sector clients. The stock currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has risen 7.6% in the past 60 days. The company’s expected earnings growth for the current year is 17.9%, higher than the Consulting Services industry’s estimated rise of 6.6%.
Limbach Holdings, Inc. provides commercial specialty contract services in the United States. The stock currently has a Zacks Rank #1 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has climbed 35.4% in the past 60 days. The company’s expected earnings growth for the current quarter is 111.1%, higher than the Building Products - Maintenance Service industry’s expected rally of 10.2%. You can seethe complete list of today’s Zacks #1 Rank stocks here.
MAXIMUS, Inc.provides business process services (BPS) to government health and human services programs. The stock currently has a Zacks Rank #2 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has moved 1.1% up in the past 60 days. The company’s expected earnings growth for the next quarter is 31.5%, higher than the Government Services industry’s projected rally of 16.2%.
First American Financial Corp., through its subsidiaries, provides financial services. The stock currently has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has moved 0.9% up in the past 60 days. The company’s expected earnings growth for the next quarter is 13.13%, slightly higher than the Insurance - Property and Casualty industry’s projected rally of 13.10%.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss.This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visithttps://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free reportFirst American Financial Corporation (FAF) : Free Stock Analysis ReportNV5 Global, Inc. (NVEE) : Free Stock Analysis ReportKelly Services, Inc. (KELYA) : Free Stock Analysis ReportMaximus, Inc. (MMS) : Free Stock Analysis ReportLimbach Holdings, Inc. (LMB) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Before You Buy Avanos Medical, Inc. (NYSE:AVNS), Consider Its Volatility
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Anyone researching Avanos Medical, Inc. (NYSE:AVNS) might want to consider the historical volatility of the share price. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first category is company specific volatility. This can be dealt with by limiting your exposure to any particular stock. The 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 see their prices move in concert with the market. Others tend towards stronger, gentler or unrelated price movements. Some investors use beta as a measure of how much a certain stock is impacted by market risk (volatility). While we should keep in mind that Warren Buffett has cautioned that 'Volatility is far from synonymous with risk', beta is still a useful factor to consider. To make good use of it you must first know that the beta of the overall market is one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one.
View our latest analysis for Avanos Medical
Zooming in on Avanos Medical, we see it has a five year beta of 1.4. This is above 1, so historically its share price has been influenced by the broader volatility of the stock market. If this beta value holds true in the future, Avanos Medical shares are likely to rise more than the market when the market is going up, but fall faster when the market is going down. Beta is worth considering, but it's also important to consider whether Avanos Medical is growing earnings and revenue. You can take a look for yourself, below.
Avanos Medical is a reasonably big company, with a market capitalisation of US$2.1b. 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 Avanos Medical 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 Avanos Medical’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 AVNS’s future growth? Take a look at ourfree research report of analyst consensusfor AVNS’s outlook.
2. Past Track Record: Has AVNS 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 AVNS's historicalsfor more clarity.
3. Other Interesting Stocks: It's worth checking to see how AVNS 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.
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Enphase Commences Shipment of IQ Microinverters From Mexico
Enphase Energy Inc. ENPH recently started shipping its seventh-generation IQ microinverters from Mexico to the U.S. market. The shipment constitutes part of the company’s extended manufacturing agreement with the multinational technological manufacturing company, Flex Ltd FLEX.A Brief Note on IQ Microinverter SystemThe Enphase IQ Microinverter System simplifies solar installations and provides complete alternative current solution that utilizes no high-voltage direct current. This provides safer solar solution to homeowners. Enphase introduced the seventh-generation microinverter in first-quarter 2018, which is light and compact, and offers state-of-the-art power performance.The IQ microinverters leverage the company’s 55nm custom ASIC for higher integration, reliability, upgradeability and scalability.How Collaboration With Flex Helps Enphase?During September 2018, Enphase expanded its manufacturing agreement with Flex to include the company's facilities in Mexico for serving customers better while maintaining core competency in product quality. Under the agreement, Flex would deliver IQ microinverters and other products manufactured in Mexico to the U.S. market for mitigating the United States Trade Representative (USTR) Section 301 tariffs. Eventually, such a move is expected to help the company increase its global capacity, improve customer delivery times and strengthen global manufacturing strategy.Our ViewPer the U.S. Energy Information Administration (EIA), solar generation in the United States is expected to increase 13.1% to 303,000 MWh/d in 2019 from 268,000 MWh/d in 2018. Moreover, the International Energy Agency (IEA) anticipates a 17% average annual growth of solar power generation between 2017 and 2030.Notably, these projections from both EIA and IEA indicate a massive addition of solar generation in the electricity production mix. This, in turn, will have a positive impact on the demand for microinverters, going ahead, which will significantly benefit microinverter producers like Enphase.Enphase's total revenues for the first quarter of 2019 were $100.2 million, up 9% sequentially and 43% year over year. This growth was led by high shipping numbers. Notably, the company shipped 976,410 microinverters during the quarter, of which approximately 94% were the seventh-generation IQ microinverters. This demonstrates the growing demand for the seventh-generation Enphase IQ microinverters, which, in turn, is expected to boost the company’s top line, in the days ahead.Price MovementShares of Enphase have surged 159.3% in the past year compared with the industry’s growth of 37.8%.
Zacks Rank & Key PicksEnphase Energy currently carries a Zacks Rank #3 (Hold). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.A few better-ranked stocks from the same space are Canadian Solar CSIQ and SunPower Corporation SPWR, each carrying a Zacks Rank #2 (Buy).Canadian Solar came up with an average positive earnings surprise of 51.66% in the last four quarters. Its long-term growth rate currently stands at 32%.SunPower delivered an average positive earnings surprise of 42.49% in the last four quarters. Its earnings growth estimate for 2019 currently stands at 48.61%.The Hottest Tech Mega-Trend of AllLast year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.See Zacks' 3 Best Stocks to Play This Trend >>
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 reportFlex Ltd. (FLEX) : Free Stock Analysis ReportEnphase Energy, Inc. (ENPH) : Free Stock Analysis ReportSunPower Corporation (SPWR) : Free Stock Analysis ReportCanadian Solar Inc. (CSIQ) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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REFILE-Italy counts on army of number-crunchers to win bad loan war
(Gives more approximate figure in paragraph 16)
* Italian banks trying to offload 'unlikely to pay' loans
* Hedge fund DKCM in talks to take on some from Intesa
* Deal could herald others, vital to restoring banks' health
By Valentina Za
MILAN, July 3 (Reuters) - How do you value a bank loan on the brink of default in an economy flirting with recession?
As it prepares to commit to buying billions of euros of such loans in Italy by mid July, U.S. hedge fund Davidson Kempner Capital Management (DKCM) has deployed legions of number crunchers to find out.
Their task is fiendishly complicated, with businesses' survival chances often hinging on the prospects for debt restructurings, turnaround plans, securing new investment or even hiring new managers.
But the implications of their work go far beyond the fate of individual borrowers as their success could bolster Italy's banking system and its economy, the euro zone's third largest.
DKCM and its Italian arm Prelios, a bad loan recovery specialist, entered exclusive talks in late March to take on up to 10 billion euros ($11 billion) in so-called 'unlikely-to-pay' (UTP) loans from Italian bank Intesa Sanpaolo.
The deal, expected to be clinched this month, is the biggest transaction in Italy so far involving UTP loans, which are not yet in default but are deemed unlikely to be recovered in full.
Italian banks' clean-up efforts have so far focused on the worst-performing loans, with large-scale sales helping lenders shift nearly 170 billion euros in impaired debt off their books in the past three years.
UTPs are the next frontier if banks are to finally put behind them the legacy of a brutal recession.
"Sales of non-performing loans are a crucial way for Italian banks to free up capital," said former Treasury economist Lorenzo Codogno, founder of LC Macro Advisors.
That is particularly important at a time when risk premiums on Italian assets have risen under the country's populist government, weakening the balance sheets of its banks and leading them to rein in lending vital for economic growth.
Italian banks hold some 80 billion euros in UTPs, which they price on average at 61% of nominal value - well above a net book value of 35% for banks' remaining 100 billion euros in insolvent loans.
The higher net book value potentially exposes lenders to larger losses in the event of a sale and this has so far held back disposals.
Two sources familiar with the matter said Intesa had demanded from the start a price close to book value for the portion of the portfolio to be sold, which will amount to no more than 40% of the 10 billion euros.
The rest will be taken under management by Prelios, which has been aggressively hiring new staff in recent months to strengthen its loan recovery capabilities, the sources said.
Intesa and DKCM declined to comment.
ROME WATCHING
A deal could spur the UTP market, where the top six transactions, according to consultancy PwC, last year totalled less than 3 billion euros.
One source said other banks were ready to follow suit, in the same way that Intesa's landmark sale of its bad-loan unit to Swedish debt collector Intrum last year was followed by a similar deal struck by Banco BPM with Elliott-backed Credito Fondiario.
Banco BPM is seen as a leading candidate to consider UTP disposal options. The bank declined to comment.
Italian authorities are watching developments in the UTP market, two institutional sources said, because regulators are aware of the need for banks to reduce UTPs but also of the challenges posed by this type of loans.
More than three quarters of Italian UTPs are held by Italy's top 10 banks and half of them by the top three, PwC says.
UTP borrowers are yet to be declared insolvent and can be restored to health. But the first hurdle is to decide whether to embark on a costly and complex restructuring process or simply liquidate the loans.
"UTPs are like the victims of an explosion: the first thing a doctor on the scene would do is to decide which patients have an actual chance of surviving," said Marco Sion Raccah, general manager of Aurora Recovery Capital, a UTP recovery specialist.
"Recovering UTPs is more expensive and complicated than recovering bad loans."
It took more than 100 people about six months just to estimate the recovery rate on roughly 1,000 Intesa loans that were examined in a due-diligence process conducted by DKCM-Prelios with the help of advisers EY, KPMG and PwC, the two sources familiar with the matter told Reuters.
The recovery process is no simpler: for each loan, a debt restructuring accord alone can cost more than 100,000 euros, and a turnaround plan requires working-capital financing and often new managers and fresh equity.
Raccah said successfully recovering a real-estate UTP offered a 20-40% upside over its liquidation value, but high fixed recovery costs meant a loan had to be worth at least 1 million euros for the process to be economically viable.
In a country of small businesses, just over half of Italian bad loans are above that threshold, PwC says.
"With some UTPs effectively headed for liquidation, successful recovery means that you have to be an excellent turnaround expert across industries as well as a good liquidator: it's not easy," one source said.
($1 = 0.8850 euros) (Reporting by Valentina Za; Editing by Mark Potter)
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Ultimate Ears Blast wireless speaker is waterproof and $110 off
TL;DR:Thewaterproof Ultimate Ears Blast wireless speakeris on sale for $69.99 saving you $110.
This summer isbringingthe heat with music, y'all. With new music fromLil Nas Xand theJonas Brothersand new albums from Tame Impala and Chance the Rapperrumoredto drop in the next few months, you're gonna need a Bluetooth speaker that can keep up.
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Monarch Casino & Resort, Inc. (NASDAQ:MCRI) Has A ROE Of 11%
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Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand Monarch Casino & Resort, Inc. (NASDAQ:MCRI).
Our data showsMonarch Casino & Resort has a return on equity of 11%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 $0.11.
View our latest analysis for Monarch Casino & Resort
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for Monarch Casino & Resort:
11% = US$34m ÷ US$310m (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. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets.
Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the 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. 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 Monarch Casino & Resort has an ROE that is roughly in line with the Hospitality industry average (14%).
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. I will like Monarch Casino & Resort better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying.
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 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.
Monarch Casino & Resort has a debt to equity ratio of 0.36, which is far from excessive. The combination of modest debt and a very respectable ROE suggests this is a business worth watching. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises.
Return on equity is one way we can compare the business quality of different companies. 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. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREEvisualization of analyst forecasts for the company.
But note:Monarch Casino & Resort 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.
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Everything You Should Consider When Traveling With Weed In The US
By Tyler Koslow. Whether you're embarking on a hazy journey to a state where adult-use cannabis is legal, or trying to decipher the marijuana laws of interstate travel, knowing the ins and outs that come with traveling with weed can be the difference maker between a trip to paradise and a vacation nightmare. When considering whether you'll be flying with edibles, riding a bus with a vape pen, or driving with weed, the way to make the safest choice is by doing substantive research. Even for cannabis tourists flocking to states with well-established medical or adult-use (aka “recreational”) markets, there are still plenty of ways that an ill-informed decision can damper your pot pilgrimage. Each aspect of your travel plan will affect your approach to flying with CBD oil, vaping on that cruise, or bringing an eighth on your road trip. When planning your trip, you should always consider: Where are you going? How are you getting there? Where are you staying? If you're planning on bringing weed with you, or even purchasing cannabis products once you arrive, knowing what to consider regarding the transport, storage, and consumption of your stash should be included when making your travel itinerary. Where Are You Traveling? Whether you're flying, taking a train, or driving, the most important thing you need to determine is whether weed is legal in the state you're traveling to. This doesn't just pertain to recreational marijuana, but also the legal status of medical marijuana and hemp-derived cannabidiol (CBD) . For instance, some states allow out-of-state medical marijuana patients to obtain temporary licenses to purchase from dispensaries through reciprocity policies , while others don't. States with Adult-Use Marijuana Take note of cannabis purchasing and possession limits — even in states with a full-fledged adult-use framework in place, the amounts will vary from state to state. Some counties and municipalities in legal states may have more restrictive regulations than others, so check the laws for each county that is along your travel route. This will help you navigate where you can buy legal cannabis and whether you can lawfully carry or consume it. Story continues Before breaking out a vape pen, know that many hotels are smoke-free, and the bans extend to cannabis consumption, too — even in states where medical or adult-use is allowed. (Photo by Markus Spiske/Unsplash) Keep in mind that while public consumption is typically illegal in adult-use states, you might be hard pressed to find a hotel or house rental that permits smoking weed indoors. For those planning to visit an adult-use state, consider booking a weed-friendly hotel or rental property, if possible. States with Medical Marijuana Even if you're a registered medical patient in your home state, check the reprecitory laws for the state you're visiting to know what's legal medically, especially whether you can use your medical marijuana card to receive temporary authorization to purchase and use medical marijuana. Be sure to review the marijuana laws and regulations of the medical state you plan to visit ahead of your trip. The requirements for obtaining a temporary medical marijuana license out of state differ by state, so don't make any assumptions on reciprocity. Some states, such as Oklahoma, allow patients with a valid out-of-state medical marijuana card to obtain a temporary 30-day license to legally acquire medical marijuana products while visiting. Illinois, on the other hand, currently has no reciprocity law in place to accept out-of-state medical marijuana patients, so only state residents can legally purchase medical cannabis. Give yourself ample time to scope out the medical marijuana laws ahead of the trip, as you may need to apply for a temporary medical marijuana card, a process that could take an extended amount of time to complete. Hawaii, for example, will accept applications up to 60 days ahead of your travel date and the Department of Health notes applications are reviewed in the order received and can't be expedited. Even if a state offers reciprocity to out-of-state patients, that doesn't give travelers free rein to cross state lines with legally purchased medical cannabis. Since cannabis is still federally classified as a Schedule I drug, medical marijuana patients can still put themselves in a risky situation when they're under federal jurisdiction, such as at an airport or state borders. States that have Decriminalized Marijuana Possession Unfortunately, there's no lawful way for travelers to bring cannabis to a destination where possession and use is illegal, even if the state has opted to decriminalize weed, softening the consequences for possessing small amounts for personal use. Some states, such as New York and Illinois, have decriminalized cannabis, but have not yet legalized adult-use or medical marijuana. In a state where weed is decriminalized, possessing small amounts of cannabis — the amount of which depends on the specific state law — doesn't typically result in jail or prison time, but instead carries a fine. What's Your Mode of Transportation? If you plan on bringing weed along for the trip, take your mode of transportation into consideration. Are you taking a Greyhound bus through multiple states? Flying across the country? Driving in a rental car? Understanding the rules and regulations involved with each will help you make a safe and well-informed decision. Traveling with Weed in a Car When it comes to driving with cannabis across state lines, the language of the law is plain and simple: it's a federal offense. Even if you're driving between two recreational states that border one another, such as Oregon and Washington, the practice of crossing the border with weed still technically falls within the jurisdiction of the federal government. As thousands of commuters make this type of trek each day along the West Coast, is it likely that federal agents will be saddled up at the border between two legal states waiting for unsuspecting drivers with pot in the car? Michael Cindrich, a San Diego-based marijuana attorney and founder of the Law Offices of Michael E. Cindrich APC, has never heard of a case where someone was prosecuted for bringing cannabis across the border of two legal states. He has, however, witnessed scenarios where drivers in California end up on a road that stretches across federal lands or parks, suddenly (and sometimes unwittingly) putting them under federal jurisdiction. “Within these states sometimes you end up on a highway or road and that road happens to travel through a federal park, and before you know it you're on federal land,” Cindrich told Weedmaps News. “You may be transporting cannabis that was legal under state law, but now you've found yourself in federal jurisdiction and it's a different story.” Once you're driving from one city to another, all within a state that has legalized adult-use cannabis, the laws become less restrictive, though there are certain nuances to consider. While states with adult-use will typically allow drivers to travel with legal amounts of cannabis, it ultimately depends on where you're traveling. In California, for example, having marijuana stored in your vehicle is legal as long as you are at least 21 years old and carrying less than 1 ounce, or about 28.5 grams, of marijuana, or less than 4 grams of concentrates. What many travelers don't know, however, is that the state also has an open-container law in place regarding cannabis. According to Health and Safety Code Section 11362.3, which is included in Proposition 64, it's illegal to “possess an open container or open package of cannabis or cannabis products while driving, operating, or riding in the passenger seat or compartment of a motor vehicle, boat, vessel, aircraft, or other vehicle used for transportation.” In other words, once your tear the seal off of the cannabis package, you're not allowed to drive around with it in the driver or passenger area of your car. When driving with weed in the vehicle, the safest place to store cannabis products is the trunk. If law enforcement officers smell marijuana, they can conduct a field sobriety test as driving while high is both dangerous and illegal. (Photo by Jackson Douglas) “The general advice for people would be to not possess any open containers, not bring any open containers of cannabis with you,” Cindrich said. “Under some circumstances, it's difficult not to have an open container. If that's the case, we'd recommend putting it in a closed container and in your trunk.” Driving while high is both illegal and dangerous and even having the lingering smell of marijuana in your vehicle can prompt a police officer to conduct a sobriety test on you and search your vehicle. “One of the other things that they're looking for is the burnt smell of marijuana, because that would lead them to believe that someone had recently consumed,” Cindrich said. “If you've recently consumed, they might pull you out of the vehicle for a DUI evaluation, and in doing so, check your vehicle for any evidence that you recently consumed.” Even in states like California, your experience during a traffic stop can range from county to county. Cindrich explained that in some areas of California, such as the roads leading out of the Emerald Triangle's legendary cultivation hub, local police will be on the lookout for drivers who possibly have cannabis in the vehicle. The same goes for counties that have more restrictive cannabis laws despite statewide legalization. “As you get to the areas that are dry and more conservative, you're going to have police that are watching for people that may be traveling through their city or county from elsewhere, they're going to be looking for signs that a person may be tied to cannabis or the cannabis industry,” Cindrich said. “Oftentimes, those people are more likely to be pulled over and harassed by law enforcement.” Things can get a little more complicated when you're cruising up the Pacific Coast or through the Rocky Mountains in a rental car. For instance, some rental car companies have a policy in place to charge you with cleaning fees if the car smells like weed upon return. According to customer service representatives at Hertz rental car at LAX, the company charges a $300 fee when a returned vehicle contains the smell of marijuana. These potential fines will vary by agency and state, so consult with your rental car company about the penalties before you decide to bring weed along for the ride. Another unintended consequence of transporting cannabis in a rental car is that it could raise suspicion from local law enforcement, especially if the vehicle has an out-of-state license plate. “I think rental cars can accelerate a normal traffic situation into something where the police are looking for further evidence of illegal activity,” Cindrich said. Traveling with Weed in a Plane Thinking of flying with a vape pen? You should consider the policies of the Transportation Security Administration (TSA), airport, and the Federal Aviation Administration (FAA) before packing. Although the Transportation Security Administration medical marijuana policy states that “TSA security officers do not search for marijuana or other illegal drugs” during a security screening, when searches are conducted for other reasons, TSA agents are required to report any suspected violations of the law, referring the matter to local law enforcement if they come across any cannabis products. “The wild card of course is what the local law is regarding marijuana,” said David Y. Bannard, a Boston-based attorney who specializes in airport regulations and compliance. “In a state where recreational use is legal, it's entirely likely that the local law enforcement will ask you to dispose or otherwise get rid of it before boarding the plane. If you're in a jurisdiction where marijuana is not legal, then you may be prosecuted.” Looking to fly with weed? Generally speaking, cannabis should not be taken through airport security or aboard airplanes. Aviation falls under federal jurisdiction, and cannabis possession is illegal. The Transportation Security Administration has clarified rules that state hemp-derived CBD products can be brought aboard aircraft, though under specific circumstances. (Photo by Erik Odiin/Unsplash) The TSA recently changed its cannabis policy regarding hemp-derived CBD, however, stating that these products may now be carried on planes under certain circumstances. “Products/medications that contain hemp-derived CBD or are approved by the FDA are legal as long as it is produced within the regulations defined by the law under the Agriculture Improvement Act 2018,” a section states. This should apply to flying with oil cartridges for vaporizers, as long as the oil is hemp-derived. Los Angeles International Airport (LAX) has a policy in place allowing visitors to possess up to about 1 ounce, or 28.5 grams, of flower or 8 grams of concentrates at the airport. However, the policy doesn't cover you once you board the airplane, which falls under the jurisdiction of the Federal Aviation Administration (FAA). Even if you're traveling from California to Washington, without ever flying over a state where marijuana is illegal, bringing cannabis on your flight is still illegal. “The FAA pretty much has undisputed jurisdiction over federal airways,” Bannard explained. “So, even though you may be flying from Seattle to Los Angeles, over Oregon and states that have legalized marijuana, the fact that you're in federal airways gives the FAA some jurisdiction there.” Additionally, just because you're in a legal state doesn't mean you can legally set foot in an airport with weed. Marijuana possession or use is strictly prohibited at the Denver International Airport (DIA), according to the Colorado airport's most recent passenger conduct policy. At the same time, cannabis smuggling arrests at LAX have risen by 166% in 2018, according to Los Angeles Airport Police records, as reported by the Los Angeles Times. In this case, smugglers are defined as those who tried to bring more than the legal possession limit in their checked luggage or carry-on bag. Another common sense policy to be wary of is that travelers bringing legally purchased cannabis to an airport in a state where cannabis is illegal can be prosecuted according to state laws. “If it's illegal in your home state, it's illegal in your home state,” Bannard said. “Just because you've got it in California, transporting it from L.A. to your home state doesn't make it legal.” If it's illegal in your home state, it's illegal in your home state. Just because you've got it in California, transporting it from L.A. to your home state doesn't make it legal. - David Y. Bannard Traveling with Weed by Train, Bus, or Boat When it comes to trains, intercity buses, and boats, it seems that the companies that offer transportation services have restrictive policies when it comes to bringing cannabis products onboard. For example, bringing cannabis is not permitted on Amtrak trains, even in legal states. “The use or transportation of marijuana in any form for any purpose is prohibited [on Amtrak trains], even in states or countries where recreational use is legal or permitted medically,” Olivia Irvin, Public Relations Manager for Amtrak, said in a statement to Weedmaps News. This would also apply to the three Amtrak lines that stay entirely within California: the Capitol Corridor in Sacramento and the Bay Area, the Pacific Surfliner in Southern California, and the San Joaquin in Central and Northern California. It also applies to the Cascades, which services Oregon and Washington. Many bus services have a similar policy in place, even when passengers are traveling within legal boundaries. On Greyhound buses marijuana, possession isn't allowed, even if the entire route remains within the confines of a legal state. Other major bus lines that operate in the U.S., such as Peter Pan, Megabus, and Flixbus, may have similar policies in place. If you plan on traveling by bus or train through a legal state, it's best to contact the specific transportation company and ask about its cannabis policy before getting onboard with weed. Passengers carrying cannabis would be best to avoid heeding the “All aboard” of an Amtrak conductor. The national intercity train service forbids cannabis along its railways, including state-sponsored lines on the West Coast where adult-use marijuana is legal. (Photo by Mike Petrucci/Unsplash) Many cruise ship lines have strict policies to slap hefty fines on travelers for smoking weed onboard. Carnival Cruise Line, for example, established an amended set of rules in November 2018 that would fine passengers up to $500 for using cannabis on the ship and may even get them kicked off entirely. “Carnival recognizes that some state and local governments in the U.S., and in the destinations we visit, might allow marijuana use. However, Carnival Cruise Line follows U.S. federal law, which strictly prohibits possession and use of recreational/medicinal marijuana and other illegal controlled substances,” the policy states. The cruise line's policy also states that if a passenger is disembarked for violating this policy, they're fully responsible for all necessary expenses to return home. “We do not allow marijuana on board our ships,” said Vance Gulliksen, Public Relations Manager for Carnival Corp. How Should You Store Your Weed While Traveling? If you've found out that you can legally bring weed with you on your trip, congratulations, now you just need to consider storage. There's no understating the importance of containing the smell, no matter the mode of transportation or final destination. Using odor-proof containers and bags will keep any away unwanted attention and show respect for fellow travelers who might not be fond of the aroma. You can find a variety of odor-proof storage products at your local head shop or online including discrete items such as a Smart Stash Pouch or Bomber Case. Even a Smelly Proof reusable bag will work. Once you have your stash safely packaged in an odor-proof container or bag, the final step is deciding where to keep your weed during the trip. When driving, a general rule is to pack your weed away in the trunk of the car. Even in a legal state such as California, having an open container of cannabis in the front area of the car can still land you into trouble. Many hotels have a private safe to store valuable personal belongings in, and can be utilized to safely store odor-proof containers or bags. Finally, if you decide to pack some weed in your suitcase, make sure it's properly situated in the odor-proof container. No matter where your travels take you, it's always smart to be discreet, safe, and responsible when taking cannabis along for the journey. Disclaimer: Today, cannabis still remains classified as a Schedule I drug at the federal level and possessing it carries inherent risks. This is an educational guide and does not provide legal advice and should not be used as a substitute for legal counsel from a licensed attorney. Lead photo by Javier Hasse. This article was originally posted on WeedMaps News. Related Stories: CBD Is Invading Over-The-Counter Retail Stores - And Consumers Love It More Weed, Less Booze? Researchers Examine Which Way Consumption Goes The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited. See more from Benzinga Does Your Dog Freak Out Over Fireworks? Try CBD More Weed, Less Booze? Researchers Examine Which Way Consumption Goes CBD Is Invading Over-The-Counter Retail Stores - And Consumers Love It © 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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Milacron Divests Uniloy to Osgood & Cyprium Investment Firms
Milacron Holdings Corp.MCRN has sold its Uniloy Blow Molding Business to Osgood Capital Group, LLC and Cyprium Investment Partners, LLC. The company has generated $51.9 million in proceeds, following the transaction’s conclusion on Jul 1. Nevertheless, Milacron will receive remaining balance of the purchase price upon closing of the sale of its Uniloy Blow Molding Business in India. Since 1998, Uniloy has operated under the Milacron product brand name.On May 15, Milacron signed an agreement with Capital Group and Cyprium Partners to divest its Uniloy Blow Molding Business. This transaction is in line with Milacron’s focus on core industry-leading technologies, including Milacron extrusion equipment, Milacron injection molding machines, CIMCOOL fluid technologies, DME mold components, and Mold-Masters hot runner and control systems.The new Uniloy business continues to provide technical expertise, high-performance machinery and aftermarket service to customers, while also fulfilling customer’s blow molding needs, under the latest ownership. Being a global leader in the blow molding industry, the Uniloy brand foresees stellar growth of Global Uniloy brands in the years ahead.Osgood capital firm acquires unique companies and executes growth through innovation, strategy and investment. Cyprium Partners is a private equity firm and a provider of common equity, preferred stock and subordinated debt to middle-market businesses.
During March-end quarter, Milacron initiated a process to divest its blow-molding business as it is no longer considered a strategic fit with the company's long-term growth and operational objectives. The blow-molding business has historically been difficult to predict and has not met the projected profitability targets.Moreover, Milacron’s exit from the blow-molding business is anticipated to help it achieve top-line growth of 5% and EBITDA margins of 20%. Though the blow-molding business’ disposition is unlikely to impact the company’s results materially, it might lower its free cash flow by $10 million. Consequently, the company now projects free cash flow at $90-$100 million for 2019.Milacron predicts sales to be down 3-4% this year, including an anticipated headwind of 1% from foreign-currency translation.
Milacron has been bearing the brunt of tariffs, and intends to mitigate the headwind by focusing on pricing actions, negotiations with existing vendors and making supply-chain modifications. Further, since 2014, Milacron has undergone a number of organizational redesign and cost-reduction initiatives to improve its cost structure and operating flexibility. Along with the restructuring, it will focus on enhancing operations, optimizing product mix, improving service to customers and augmenting the company’s financial performance.
Milacron Holdings Corp. Price and Consensus
Milacron Holdings Corp. price-consensus-chart | Milacron Holdings Corp. Quote
Zacks Rank & Stocks to ConsiderMilacron currently carries a Zacks Rank #3 (Hold).A few better-ranked stocks in the Industrial Products sector are AptarGroup, Inc. ATR, Roper Technologies, Inc. ROP and CIRCOR International, Inc. CIR , each sporting a Zacks Rank #1 (Strong Buy), at present. You can seethe complete list of today’s Zacks #1 Rank stocks here.AptarGroup has an estimated earnings growth rate of 8.7% for the ongoing year. The company’s shares have gained 34% in the past year.Roper Technologies has an expected earnings growth rate of 9.4% for the current year. The stock has appreciated 37.7% in a year’s time.CIRCOR International has a projected earnings growth rate of 7.6% for 2019. The stock has rallied 21.8% over the past year.The Hottest Tech Mega-Trend of AllLast year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.See Zacks' 3 Best Stocks to Play This Trend >>
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 reportAptarGroup, Inc. (ATR) : Free Stock Analysis ReportRoper Technologies, Inc. (ROP) : Free Stock Analysis ReportMilacron Holdings Corp. (MCRN) : Free Stock Analysis ReportCIRCOR International, Inc. (CIR) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Victory Capital (VCTR) Closes Buyout of USAA Asset Management
Following the acquisition of USAA Asset Management Company, shares ofVictory Capital Holdings, Inc.VCTR have jumped 7.68%. The purchase includes USAA’s Mutual Fund and ETF businesses as well along its 529 College Savings Plan.Notably, Victory Capital had announced the acquisition last November to expand its investment platform in fixed income and solutions asset classes. The deal was financed through a combination of debt and cash. Victory Capital’s pro forma Debt/EBITDA ratio at the close of the transaction came in at around 2.7x.Benefits of the DealIn addition to creating value for Victory Capital, this deal is also projected to be significantly accretive to the company’s earnings per share. EPS accretion of more than 100% is anticipated in 2020, which will be the company’s first full year of ownership. However, EPS accretion of more than 40% is likely to occur in 2019.Notably, Victory Capital increased the cost-synergy estimates from $110 million to $120 million. Per the company, on the close of the transaction, around $75 million of synergies were realized. Further, approximately $100 million of synergies are likely to occur within six months post-closing and total $120 million is expected to be realized within 12-15 months.“The acquisition of USAA Asset Management Company significantly diversifies our investment capabilities and increases our size and scale. It also broadens our distribution platform to include a direct channel through which we have the unique opportunity to serve USAA members,” said David Brown, chairman and chief executive officer, Victory Capital. “We are pleased to welcome the USAA investment professionals to our integrated multi-boutique platform and are honored to serve the investment needs of the military community,” added Brown.USAA Asset Management is a privately-owned investment manager based in San Antonio, TX. It has a stellar investment performance track record and a distinguished reputation for providing service to its members.As of Apr 30, 2019, Victory Capital’s total AUM came in at $61 billion and USAA Asset Management Company had AUM of $81.3 billion.Our TakeWith this acquisition, Victory Capital plans to expand its presence in the San Antonio region and further enhance investment services for members of USAA Asset Management. Victory Capital will be able to expand its Solutions Platform in order to include target date and target risk strategies, managed volatility mutual funds and active fixed income ETFs.Shares of Victory Capital have gained 15.3% in the past three months compared with 5.6% growth registered by the industry.
The stock currently has a Zacks Rank #5 (Strong Sell).Stocks to ConsiderFranklin Resources, Inc. BEN has been witnessing upward estimate revisions for the last 60 days. Additionally, the stock has jumped more than 15% in the past six months. It currently sports a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.Legg Mason, Inc. LM has been witnessing upward estimate revisions for the last 60 days. Also, the company’s shares have surged nearly 40.5% over the past six months. It flaunts a Zacks Rank #1, at present.Eaton Vance Corporation EV has been witnessing upward estimate revisions for the last 60 days. Over the past six months, the company’s share price has been up more than 21%. Currently, it carries a Zacks Rank #2 (Buy).The Hottest Tech Mega-Trend of AllLast year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.See Zacks' 3 Best Stocks to Play This Trend >>
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 reportEaton Vance Corporation (EV) : Free Stock Analysis ReportLegg Mason, Inc. (LM) : Free Stock Analysis ReportFranklin Resources, Inc. (BEN) : Free Stock Analysis ReportVictory Capital Holdings, Inc. (VCTR) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Boeing makes $100 million pledge for 737 MAX crash-related support
By Eric M. Johnson and Tracy Rucinski
SEATTLE/CHICAGO (Reuters) - Boeing Co said on Wednesday it would give $100 million over multiple years to local governments and non-profit organizations to help families and communities affected by the deadly crashes of its 737 MAX planes in Indonesia and Ethiopia.
The move appears to be a step toward repairing the image of the world's largest planemaker, which has been severely dented by the crash of an Ethiopian Airlines plane in March just five months after a similar crash of a Lion Air flight in Indonesia.
The two crashes killed a total of 346 people.
Boeing is the target of a U.S. Department of Justice criminal investigation into the development of the 737 MAX, regulatory probes and more than 100 lawsuits by victims' families.
The multi-year payout is independent of the lawsuits and would have no impact on litigation, a Boeing spokesman said.
The $100 million, which is less than the list price of a 737 MAX 8, is meant to help with education and living expenses and to spur economic development in affected communities, Boeing said. It did not specify which authorities or organizations would receive the money.
Many of the passengers on board the Ethiopian Airlines flight were aid workers or involved with health, food, or environmental programs.
"If the money is spent on furthering the work of the people on that airplane it would be money well spent," said Justin Green, a New York-based attorney representing several of the Ethiopia crash victims.
But he said the fund would not affect his clients' courtroom strategy: "What families really want to know is why this happened. Could this have been avoided?"
Anton Sahadi, a representative of relatives of the Lion Air crash victims, said the families appreciated the $100 million fund but it did not mean they would stop lawsuits.
"We will continue to fight for our rights in the courts," he said. "Boeing is doing this to build their image back."
CHARM OFFENSIVE
After the Lion Air crash on Oct. 29 Boeing started developing a software https://www.reuters.com/article/us-ethiopia-airplane-southwest/boeing-sees-fix-for-latest-737-max-software-flaw-in-september-idUSKCN1TS26Q?enowpopup fix on a stall-prevention system called MCAS believed to have played a role in that disaster, as well as in the Ethiopian crash.
The 737 MAX was grounded worldwide after the second crash and regulators must approve the fix and new pilot training before the jets can fly again.
But just last month, regulators identified a new problem that will delay commercial flight for the jets until October at the earliest.
Boeing is in settlement talks over the Lion Air litigation and has separately offered to negotiate with families of Ethiopian Airlines victims, but some families have said they are not ready to settle, exposing the planemaker to a lengthy court battle.
"The Boeing brand is worth far more than $100 million and the board and executive leadership understand that is what is at stake," said William Klepper, a Columbia Business School professor.
Following an initial response that public relations experts criticized as stilted and lawyer-driven, Boeing has been on a charm offensive, with executives at the Paris Airshow last month repeatedly apologizing for the loss of life. Boeing Chief Executive Officer Dennis Muilenburg posts regular Twitter updates on efforts to safely return the 737 MAX to service and win back public confidence.
Robert Clifford, a Chicago-based attorney with several of the Ethiopian crash cases, suggested some of Boeing's $100 million pledge could be spent assisting efforts to return the remains of victims to their families.
"These families are distraught about the effort to get back their loved ones," Clifford said. "They want closure."
Boeing has also offered to match any employee donations in support of the families and communities impacted by the accidents through December.
(Reporting by Eric M. Johnson in Seattle and Tracy Rucinski in Chicago; additional reporting by Cindy Silviana in Jakarta and Tina Bellon in New York; editing by Bill Rigby and Grant McCool)
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Does MasterCraft Boat Holdings, Inc.'s (NASDAQ:MCFT) P/E Ratio Signal A Buying Opportunity?
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This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll show how you can use MasterCraft Boat Holdings, Inc.'s (NASDAQ:MCFT) P/E ratio to inform your assessment of the investment opportunity.MasterCraft Boat Holdings has a price to earnings ratio of 8.37, based on the last twelve months. That means that at current prices, buyers pay $8.37 for every $1 in trailing yearly profits.
View our latest analysis for MasterCraft Boat Holdings
Theformula for P/Eis:
Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS)
Or for MasterCraft Boat Holdings:
P/E of 8.37 = $20.01 ÷ $2.39 (Based on the year to March 2019.)
A higher P/E ratio means that buyers have to paya higher pricefor each $1 the company has earned over the last year. That is not a good or a bad thingper se, but a high P/E does imply buyers are optimistic about the future.
Generally speaking the rate of earnings growth has a profound impact on a company's P/E multiple. Earnings growth means that in the future the 'E' will be higher. That means unless the share price increases, the P/E will reduce in a few years. A lower P/E should indicate the stock is cheap relative to others -- and that may attract buyers.
Notably, MasterCraft Boat Holdings grew EPS by a whopping 36% in the last year. And earnings per share have improved by 6.0% annually, over the last five years. With that performance, I would expect it to have an above average P/E ratio.
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 (18.7) for companies in the leisure industry is higher than MasterCraft Boat Holdings's P/E.
Its relatively low P/E ratio indicates that MasterCraft Boat Holdings 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. It is arguably worth checkingif insiders are buying shares, because that might imply they believe the stock is undervalued.
One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. In other words, it does not consider any debt or cash that the company may have on the balance sheet. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth.
Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context.
Net debt is 32% of MasterCraft Boat Holdings's market cap. While that's enough to warrant consideration, it doesn't really concern us.
MasterCraft Boat Holdings's P/E is 8.4 which is below average (18.2) in the US market. The company does have a little debt, and EPS growth was good last year. If it continues to grow, then the current low P/E may prove to be unjustified. Since analysts are predicting growth will continue, one might expect to see a higher P/E soit may be worth looking closer.
Investors should be looking to buy stocks that the market is wrong about. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' So thisfreevisualization of the analyst consensus on future earningscould help you make theright decisionabout whether to buy, sell, or hold.
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.
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AOC accuses Trump of provoking border crisis to ‘squeeze out money for a wall’
Congresswoman Alexandria Ocasio-Cortez (D-NY)toldHunter Walker of Yahoo News that blame for the funding crisis ultimately falls on President Donald Trump and his effort to pay for a long-sought border wall.
“He creates a political moment where he can squeeze out money for a wall,” said Ocasio-Cortez, who is also known as AOC. “The reason that he does this is to create this outrage and to say we need more money.”
She added that the situation “is completely engineered by him.”
The comments came hours after Ocasio-Cortez on Monday toured migrant detention facilities run by Customs and Border Patrol (CBP), which shedescribedas “horrifying.”
A reportreleased by an internal government watchdogon Tuesday found the harsh conditions within migrant detention facilities are more pervasive than had initially been made public. Thereportdetails overcrowding, insufficient food provisions, and health problems that result from the conditions.
“In addition to the overcrowding we observed,” the Homeland Security Inspector General report noted, “Border Patrol’s custody data indicates that 826 (31 percent) of the 2,669 children at these facilities had been held longer than the 72 hours generally permitted under the TEDS standards and the Flores Agreement.”
President Trump has blamed Democrats for the immigration crisis based on the failure to strike a bipartisan immigration reform deal. He has also claimed child separation began under President Obama.
However, while some children were separated from their families during the prior administration, the scale of separations and detentions dramatically increased after the Trump administration began implementing a “zero tolerance” policy at the border in April 2018.
The border wall funding fight has been ongoing for months.
In February, after a 35-day partial governmentshutdown, lawmakers declined to appropriate $5.7 billion for the wall but agreed to give $1.4 billion for fencing and other barriers. Trump then declared a national emergency to reallocate as much as $6.7 billion by drawing on emergency authorization.
In March, then-acting Defense Secretary Patrick Shanahanannounceda plan to transfer $1 billion for the building of 57 miles of new border fencing. Last week, Trumpappealeda federal court ruling that had blocked the reallocation of $2.5 billion that had been intended to fight drug activities.
Ocasio-Cortez criticized what she considers Trump’s selective willingness to call for a state of emergency when it suits his policy aims.
“He declared a national emergency to move funds to build a wall,” Ocasio-Cortez told Walker. “If he actually cared about these kids lives he could have snapped his fingers and done that easily to get them the care that they needed.”
On Monday, Trumpsigneda $4.6 billion funding package for the U.S.-Mexico border that provides resources for CBP and other federal agencies to alleviate overcrowding in their facilities. The measure alsocalls for$200 million in funding for Immigration and Customs Enforcement and $110 million in overtime pay for CBP workers.
Ocasio-Cortez asserted that the “whole congressional allocation was a farce because if he really cared about human lives he wouldn’t have needed us the same way he bypasses us for a wall.”
The border funding measure split congressional Democrats, many of whom initially backed a House bill that put additional restrictions on the funds but later voted for a Senate version of the bill that didn’t include the protections. House Speaker Nancy Pelosi, among those who initially rejected the Senate version of the measure,saidshe later backed it “in order to get resources to the children fastest.”
Ocasio-Cortez condemned lawmakers in her own party for supporting a flawed border funding measure, referring to those who backed the Senate version of the measure as “horrible Democrats.”
Check out AOC’s exclusive interview with Yahoo News >
Max Zahn is a reporter for Yahoo Finance.
Read more:
• How black women could give Kamala Harris a financial boost in 2020
• Democratic debate showed most every 2020 candidate talks like Bernie Sanders on wealth inequality
• How Donald Trump strengthened The New York Times and grew a Mexican billionaire's fortune
• Read the latest financial and business news from Yahoo Finance
Follow Yahoo Finance onTwitter,Facebook,Instagram,Flipboard,SmartNews,LinkedIn,YouTube, andreddit.
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USA Truck, Inc. (NASDAQ:USAK) Delivered A Better ROE Than Its Industry
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While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to examine USA Truck, Inc. (NASDAQ:USAK), by way of a worked example.
USA Truck has a ROE of 15%, based on the last twelve months. Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.15.
See our latest analysis for USA Truck
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for USA Truck:
15% = US$13m ÷ US$83m (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.
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, all else equal,investors should like a high ROE. 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. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. Pleasingly, USA Truck has a superior ROE than the average (12%) company in the Transportation industry.
That's what I like to see. I usually take a closer look when a company has a better ROE than industry peers. For exampleyou might checkif insiders are buying shares.
Virtually all companies need money to invest in the business, to grow profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first 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. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking.
USA Truck clearly uses a significant amount of debt to boost returns, as it has a debt to equity ratio of 2.00. while its ROE is respectable, it is worth keeping in mind that there is usually a limit to how much debt a company can use. Investors should think carefully about how a company might perform if it was unable to borrow so easily, because credit markets do change over time.
Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have the same ROE, then I would generally prefer the one with less debt.
Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. 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:USA Truck 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.
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Trump defends cost of having tanks and military planes at his July 4 celebration
On the eve of his planned July 4 celebration in Washington, D.C., President Trump pushed back against criticism over the amount of money it is costing American taxpayers. According to the Washington Post , the National Park Service is diverting nearly $2.5 million in entrance and recreation fees primarily intended to improve parks across the country to cover costs. The White House has refused to disclose the actual cost of the event. The cost of our great Salute to America tomorrow will be very little compared to what it is worth, Trump tweeted Wednesday morning. We own the planes, we have the pilots, the airport is right next door (Andrews), all we need is the fuel. We own the tanks and all. Fireworks are donated by two of the greats. Nice! On Tuesday, the president announced that Phantom Fireworks and Fireworks by Grucci were donating their services for the biggest fireworks show Washington D.C. has ever seen. (Yahoo News photo Illustration; photos: AP, Getty Images) Our July 4th Salute to America at the Lincoln Memorial is looking to be really big, Trump added in a tweet Wednesday. It will be the show of a lifetime! Trumps insistence on putting on such a show replete with tanks, military bands, fireworks and flyovers has drawn sharp criticism from Democrats, city officials and reportedly some U.S. military chiefs . Washington, D.C., Mayor Muriel Bowser told NPR that she has some concerns about a president not celebrating the military but glorifying military might. That scares me the most. [ Related: Trumps July 4 celebration: Patriotic or self-promoting? ] The White House is distributing VIP tickets to Republican donors and political appointees for the event, prompting objections from Democratic lawmakers who say that the Trump campaign should foot the bill. The Trump administration also distributed 5,000 tickets to the Department of Defense. This is beyond the pale, tweeted Sen. Tom Udall, D-N.M., who sits on the Senate Appropriations Subcommittee on the Interior, Environment and Related Agencies. The American people pay these entrance fees to make improvements at our national parks not to boost President Trumps campaign. The National Mall is not the place to hold a de facto political rally. Story continues One of two Bradley Fighting Vehicles is parked next to the Lincoln Memorial ahead of President Trump's Salute to America event. (AP photo/Andrew Harnik) Meanwhile, the Pentagon is reportedly grappling with how to move a pair of 70-ton M1A2 Abrams tanks to the National Mall. Part of the concern is that the vehicles will pulverize pavement in Washington, as they did during a parade in June 1991 after the Gulf War, and that the city will be left with the bill, the Post reported. According to the newspaper, the tanks will be stationary and moved into place on flatbeds pulled by heavy-hauler trucks. CNN reported Wednesday that military chiefs raised concerns about the politicization of Trumps event during its planning, expressing reservations about having tanks or other armored vehicles on display. The president, who attended the Bastille Day parade in France in 2017, has long hoped to replicate a similar display in the United States. Last year, Trumps efforts to stage a Veterans Day military parade down Pennsylvania Avenue were scrapped over cost concerns. ___ Read more from Yahoo News: AOC says U.S. is 'headed to fascism' after tour of border detention facilities Migrant children report verbal abuse, threats while in Border Patrol custody Ocasio-Cortez: Ivanka Trump is not a 'qualified diplomat' Trump administration to print census forms without citizenship question Trump on blight of homelessness in U.S. cities: Its disgraceful
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Lots of Good News For Invesco KBW Bank ETF
This article was originally published onETFTrends.com.
As has been widely reported in the recent days, the results from the Federal Reserve's Comprehensive Capital Analysis and Review, or CCAR, were mostly impressive, providing an avenue for major domestic banks to significantly increase capital returns to shareholders, both in the form of dividends and buybacks.
CCAR “evaluated the capital planning processes and capital adequacy of 18 of the largest banking firms, including the firms' planned capital actions, such as dividend payments and share buybacks,”said the Federal Reserve. “Strong capital levels act as a cushion to absorb losses and help ensure that banking organizations have the ability to lend to households and businesses even in times of stress.”
TheInvesco KBW Bank ETF (KBWB) is one exchange traded fund poised to benefit from those higher dividends and larger buybacks.
KBWB “tracks the KBW Nasdaq Bank Index and as the fund and index names imply, the products are dedicated to bank stocks, unlike diversified financial services, which usually future exposure to capital markets firms and insurance providers,”according to Nasdaq.
Inside KBWB
Because KBWB is a dedicated bank ETF, it stands to benefit more from the CCAR news than a traditional diversified financial services fund.
The all clear signal paved the way for banks to raise dividends and stock buybacks that would strengthen their company stocks left behind in the market rally. The 18 banks, a group that includes prominent U.S. lenders like JPMorgan Chase & Co. and Bank of America Corp., are expected to raise payouts to over 100% of expected earnings.
“Several marquee KBWB holdings, including Bank of America (BAC), JPMorgan Chase & Co. (JPM) and US Bancorp (USB), are expected to have higher payout ratios this year than they did following the 2018 CCAR, meaning dividends are growing,” notes Nasdaq.
J.P. Morgan Chase raised dividend by 13% to 90 cents a share from 80 cents a share and said it can repurchase up to $29.4 billion in stocks, compared to $20.7 billion last year.
Bank of America hiked up its dividend to 18 cents a share from 15 cents and could repurchase up to $30.9 billion in stock.
Indicating that the CCAR results are in fact good news for bank stocks, KBWB is up nearly 4% over the past week.
For more information on the financial sector, visit ourfinancial category.
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Scientists claim to have developed world's first vaccine with artificial intelligence
AI could revolutionise the development of drugs and vaccines, experts believe - PA A new flu vaccine designed by artificial intelligence has gone on trial in the United States in what researchers are claiming is a world first. Scientists at Flinders University in Australia have developed what they describe as a turbo-charged flu vaccine with an extra component that stimulates the human immune system to make more antibodies against the flu virus than a normal vaccine, thus making it more effective. Nikolai Petrovsky, professor of medicine at Flinders University in Australia and the lead researcher on the vaccine, said that as far as he knew this was the first time a flu vaccine had been developed using AI that had progressed to a trial in humans. He said that the use of AI had accelerated the vaccine discovery process, cut costs massively and had enabled the development of a more effective vaccine. He said using AI streamlined the vaccine development process. Normally, big companies like GSK will screen millions of compounds, with thousands of people working week in week out on this for about five years. It costs hundreds of millions of dollars to come up with one lead, he said. By contrast Prof Petrovsky's small research team had taken around two years to develop this new vaccine with the help of AI. Earlier this year the World Health Organization warned that better tools to prevent, detect, control and treat both pandemic and seasonal influenza were urgently needed , including a better vaccine. The vaccine against seasonal flu does not offer full protection - the vaccine used during the 2017-18 flu season in the UK had only a 10 per cent efficacy among the over 65s and an average of 15 per cent across all age groups, Public Health England said. The Australian researchers created a computer programme called Sam which they taught how to recognise vaccines that worked against the flu and those that did not. They then created another computer programme, which Prof Petrovsky likened to a mad chemist, to create trillions of imaginary compounds. It then came up with a shortlist of what it considered to be the 10 most effective targets. Story continues So rather than screening millions of compounds we only worked with a handful. It took just a few weeks to synthesise them and then we tested them on human blood. The compounds then went through animal testing and are now in humans, he said. The advantage of using AI is that it not only speeds up the process but it also finds the most effective compounds, he said. AI uses artificial neural networks, which mimic the human brain, recognising patterns and adapting to change. But it can take in and process far more information than the human brain ever could. The study, funded by the National Institute of Allergy and Infectious Diseases in the US, is looking to recruit about 240 volunteers and will test their immune response to the vaccine. Prof Petrovsky said that in 20 years AI would be routinely used in drug development. AI has been progressively used in clinical decision-making - which drugs should I use for which patient. But drug design has been considered such a difficult thing to do it was thought to be beyond the capability of current AI. But weve shown that we can do it, he said. Prof Petrovsky believes that the vaccine could be available in about three years if it jumps all the final hurdles. Given the need and the pull to provide a better flu vaccine this is not something thats going to sit on the shelf for the next 10 years, he said. Protect yourself and your family by learning more about Global Health Security
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The Best Places to Live in Pennsylvania
What part of PA do you want to call home? If Pennsylvania is the state you want to call home, there's no shortage of suitable options. Whether you need to be in a big-city setting, prefer a more suburban vibe or would rather embrace a rural hometown, Pennsylvania has it all, from the City of Brotherly Love to Amish country. Out of the 125 most populous metro areas in the U.S., eight are in Pennsylvania. We've compiled information from the Best Places to Live rankings, which look at desirability, affordability, access to quality health care and more, to help you decide which major metro area in the Keystone State is right for you. Philadelphia Best Places to Live 2019 Rank: 102 Metro Population: 6,065,644 Median Home Value: $200,142 Median Annual Salary: $54,940 Philadelphia is the most populous metro area in Pennsylvania, and the first U.S. city to earn World Heritage City status from the Organization of World Heritage Cities. Of the factors contributing to the area's Best Places to Live ranking, Philadelphia receives its best score for its job market. While the metro area has a median annual salary of $54,940, $4,000 above the national average, its unemployment rate is above average at 4.2%. Learn more about Philadelphia . Scranton Best Places to Live 2019 Rank: 98 Metro Population: 557,942 Median Home Value: $100,600 Median Annual Salary: $41,980 Located in the northwestern part of Pennsylvania, Scranton receives the seventh-highest score out of the 125 most populous metro areas in the U.S. for its proximity to quality health care, based on U.S. News Best Hospitals data. Scranton residents spend 22.67% of the median annual household income on housing costs. But the unemployment rate in Scranton is high at 5%, compared to the national average of 3.9%. Learn more about Scranton . Allentown Best Places to Live 2019 Rank: 93 Metro Population: 832,790 Median Home Value: $174,858 Median Annual Salary: $46,920 The U.S. Census Bureau considers parts of New Jersey to be within the Allentown metro area, a connection felt commonly by many residents who regularly travel between Pennsylvania, New Jersey and even New York. Allentown has the 10th-highest score out of the 125 metro areas in the Best Places to Live rankings for its proximity to quality health care. Story continues Learn more about Allentown . York Best Places to Live 2019 Rank: 87 Metro Population: 442,216 Median Home Value: $164,258 Median Annual Salary: $44,740 Located close to Pennsylvania's border with Maryland, York offers a more rural setting. The cost of living in York requires a smaller share of the median household income than Philadelphia, but it's still higher than other Pennsylvania metro areas at 23.08%. The unemployment rate in the area is just below the national average at 3.8%. Learn more about York . Reading Best Places to Live 2019 Rank: 84 Metro Population: 415,500 Median Home Value: $151,900 Median Annual Salary: $46,100 The smallest Pennsylvania metro area on the list by population, Reading ties with Lancaster and York for first place out of the 125 most populous metro areas in the U.S. when it comes to having nearby access to top-notch health care. Additionally, low property crime and murder rates lead Reading to rank 22nd for crime out of the 125 most populous metro areas in the U.S. Reading residents spend 23.44% of the median annual household income on housing costs. Learn more about Reading . Pittsburgh Best Places to Live 2019 Rank: 50 Metro Population: 2,348,143 Median Home Value: $140,855 Median Annual Salary: $48,580 With a cost of living requiring just 20.51% of the median annual household income, Pittsburgh is the most affordable place to live out of the eight Pennsylvania metro areas on this list. However, the low cost of living hasn't created an influx of new residents. Between 2013 and 2017, the Pittsburgh metro area's population decreased by 0.28% due to net migration, according to data from the U.S. Census Bureau. Learn more about Pittsburgh . Lancaster Best Places to Live 2019 Rank: 48 Metro Population: 536,494 Median Home Value: $196,025 Median Annual Salary: $43,760 If the slower, rural life in the heart of Amish country checks your boxes for a future hometown, look no further than Lancaster. The Lancaster metro area ranks second for quality of life on the overall Best Places to Live list, following Santa Barbara, California, for college readiness among high school students, access to quality health care, resident well-being based on the Gallup-Sharecare Well-Being Index, crime rates and average commute time. Learn more about Lancaster . Harrisburg Best Places to Live 2019 Rank: 44 Metro Population: 565,008 Median Home Value: $162,967 Median Annual Salary: $48,270 The highest-ranked Pennsylvania metro area on the Best Places to Live list is also the state's capital. Harrisburg's highest score is for its affordability, with residents spending just 21.98% of the median annual household income on housing. Additionally, Harrisburg ranks fourth overall -- following York, Lancaster and Reading -- for its proximity to quality health care options. Learn more about Harrisburg . The best places to live in Pennsylvania are: -- Harrisburg -- Lancaster -- Pittsburgh -- Reading -- York -- Allentown -- Scranton -- Philadelphia More From US News & World Report The 25 Best Places to Live in the U.S. for Quality of Life in 2019 The 20 Best Places to Live in the U.S. for the Weather in 2019 The 25 Best Places People Are Moving to in 2019
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Should You Think About Buying MGP Ingredients, Inc. (NASDAQ:MGPI) Now?
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MGP Ingredients, Inc. (NASDAQ:MGPI), which is in the beverage business, and is based in United States, received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to $88.06 at one point, and dropping to the lows of $60.21. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether MGP Ingredients's current trading price of $65.62 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at MGP Ingredients’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.
Check out our latest analysis for MGP Ingredients
The stock seems fairly valued at the moment according to my relative valuation model. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 29.59x is currently trading slightly below its industry peers’ ratio of 30.59x, which means if you buy MGP Ingredients today, you’d be paying a fair price for it. And if you believe MGP Ingredients should be trading in this range, then there isn’t much room for the share price grow beyond where it’s currently trading. Although, there may be an opportunity to buy in the future. This is because MGP Ingredients’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company’s shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company's future expectations. With profit expected to grow by a double-digit 20% in the upcoming year, the short-term outlook is positive for MGP Ingredients. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.
Are you a shareholder?MGPI’s optimistic future growth appears to have been factored into the current share price, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at MGPI? Will you have enough conviction to buy should the price fluctuate below the true value?
Are you a potential investor?If you’ve been keeping an eye on MGPI, now may not be the most optimal time to buy, given it is trading around its fair value. However, the optimistic forecast is encouraging for MGPI, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on MGP Ingredients. You can find everything you need to know about MGP Ingredients inthe latest infographic research report. If you are no longer interested in MGP Ingredients, you can use our free platform to see my list of over50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Kellogg News: K Stock Surges on Plant-Based Meat Chatter
Kellogg news for Wednesday about its plant-based meat offerings have K stock heading higher.
Source: Shutterstock
Kellogg(NYSE:K) is the owner of MorningStar Farms, which is a brand that deal is fake meat. It’s origins date back to the 1970s and is the largest maker of plant-based meat. This includes both chicken and burgers.
There’s a major buzz around fake meat right now that could have Kellogg cashing in on this brand. Other companies, such asBeyond Meat(NASDAQ:BYND) andImpossible Burger, are seeing growth as their business picks up in the raising market.
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The real surprise from the Kellogg news is that the company isn’t looking to capitalize on this. There areno known plansfrom the company to hold an IPO for MorningStar Farms or attempt to revitalize the brand.
High estimates claim that MorningStar Farms is pulling in revenue of roughly $450 million a year. On the low end that may be closer to $300 million. Even at these values, that’s still above revenue estimates of $210 million for Beyond Meat in 2019, reportsMarketWatch.
• 10 Stocks That Should Be Every Young Investor's First Choice
All of this talk about Kellogg potentially having an incredible value hidden among its brands has K stock on its way up today. The stock was up 6% as of Wednesday morning, but is down 5% since the start of the year. It also hasn’t been performing well for the last few years. It peaked at $85.99 back in July 2019, but was trading at $53.31 when markets closed on Tuesday.
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As of this writing, William White did not hold a position in any of the aforementioned securities.
The postKellogg News: K Stock Surges on Plant-Based Meat Chatterappeared first onInvestorPlace.
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Putin signs bill suspending participation in nuclear treaty
MOSCOW (AP) — President Vladimir Putin has signed a bill suspending Russia's participation in a pivotal nuclear arms treaty. Putin's decree, released on Wednesday, formalizes Russia's departure from the 1987 Intermediate-Range Nuclear Forces treaty with the United States following Washington's withdrawal from the pact. The U.S. gave notice of its intention to withdraw from the INF in February, setting the stage for it to terminate in six months unless Moscow returns to compliance. Russia has denied any breaches, and accused the U.S. of violating the pact. Moscow followed Washington's example in February, also suspending its obligations under the treaty. The INF treaty, signed by U.S. President Ronald Reagan and Soviet leader Mikhail Gorbachev, banned production, testing and deployment of land-based cruise and ballistic missiles with a range of 500 to 5,500 kilometers (310 to 3,410 miles). The intermediate-range weapons were seen as particularly destabilizing as they take a shorter time to reach their targets compared to the intercontinental ballistic missiles. That would leave practically no time for decision-makers, raising the likelihood of a global nuclear conflict over a false launch warning. Putin has vowed that Russia will not be the first to deploy new intermediate-range missiles and warned the U.S. against deploying new missiles in Europe, saying that Russia will retaliate by fielding new fast weapons that will take just as little time to reach their targets.
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4 Oil Stocks to Sell Now
Global equities took a breather on Tuesday as crude oil slipped lower despite OPEC plus Russia confirming a deal tocontinue oil production cutsat their meeting. West Texas Intermediate Crude has been battling with the confluence of its 50-day and 200-day moving averages, struggling to push definitively above the $60-a-barrel level.
Also working against risk assets was President Donald Trump’s fresh trade swipe at Europe, just as tensions with China are calming. European factory activity is already quite weak, so this is raising fears a protracted standoff could well send the Eurozone into recession.
• 10 Stocks That Should Be Every Young Investor's First Choice
Recessions, of course, are no good for energy demand. Here are four major oil and gas stocks to sell now ahead of a possible pullback:
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Shares ofExxon Mobil(NYSE:XOM) are rolling down out of multimonth resistance near $78 to drop back below its 50-day and 200-day moving averages. This coincides with the May trading range and risks a return to the late-May lows, which would be worth a loss of roughly 8% from here.
The company will next report results on Aug. 2 before the bell. Analysts are looking for earnings of 97 cents per share on revenues of $69.6 billion. When the company last reported on April 26, earnings of 55 cents per share missed estimates by 19 cents on a 6.7% decline in revenues.
Chevron(NYSE:CVX) shares are dropping away from the prior highs hit in March and April, setting the stage for a test of the April-May lows near $114, which would be worth a loss of roughly 7% from here. The company recently backed away from a competing offer forAnadarko(NYSE:APC) afterOccidental(NYSE:OXY) made a highly motivated offer.
• 7 F-Rated Stocks to Sell for Summer
The company will next report results on Aug. 2 before the bell. Analysts are looking for earnings of $1.98 per share on revenues of $41.2 billion. When the company last reported on April 26, earnings of $1.39 beat estimates by nine cents per share on a 6.8% decline in revenues.
EOG Resources(NYSE:EOG) shares are dropping back below their 50-day moving average and were unable to break above the 200-day moving average that has contained the upside since last October. The company was recently upgraded from neutral to buy by analysts atGoldman Sachs(NYSE:GS), just in time for what looks like a retest of the early June lows.
The company will next report results on Aug. 1 after the close. Analysts are looking for earnings of $1.39 per share on revenues of $4.5 billion. When the company last reported on May 2, earnings of $1.19 per share beat estimates by 16 cents on a 10.3% rise in revenues.
Shares ofConocoPhillips(NYSE:COP) are bonking into resistance from the mid-May highs. This continues a downtrend that has been in place since February and sets the stage for a drop back to its December lows near $56. That would be worth a loss of roughly 8% from here. Shares were recently upgraded byMizuho analysts. They gave it a “buy” rating with an $80 price target.
• The 7 Top Small-Cap Stocks Of 2019
The company will next report results on July 30 before the bell. Analysts are looking for earnings of $1.09 per share on revenues of $9.7 billion. When the company last reported on April 30, earnings of $1 per share beat estimates by 10 cents on more than $9 billion in revenues.
As of this writing, William Roth did not hold a position in any of the aforementioned securities.
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The post4 Oil Stocks to Sell Nowappeared first onInvestorPlace.
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Should You Worry About Air Transport Services Group, Inc.'s (NASDAQ:ATSG) CEO Salary Level?
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Joe Hete became the CEO of Air Transport Services Group, Inc. (NASDAQ:ATSG) in 2007. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. This process should give us an idea about how appropriately the CEO is paid.
View our latest analysis for Air Transport Services Group
Our data indicates that Air Transport Services Group, Inc. is worth US$1.4b, and total annual CEO compensation is US$2.3m. (This figure is for the year to December 2018). While this analysis focuses on total compensation, it's worth noting the salary is lower, valued at US$750k. We examined companies with market caps from US$1.0b to US$3.2b, and discovered that the median CEO total compensation of that group was US$4.0m.
This would give shareholders a good impression of the company, since most similar size companies have to pay more, leaving less for shareholders. However, before we heap on the praise, we should delve deeper to understand business performance.
You can see a visual representation of the CEO compensation at Air Transport Services Group, below.
On average over the last three years, Air Transport Services Group, Inc. has grown earnings per share (EPS) by 50% each year (using a line of best fit). The trailing twelve months of revenue was pretty much the same as the prior period.
Overall this is a positive result for shareholders, showing that the company has improved in recent years. It's good to see a bit of revenue growth, as this suggests the business is able to grow sustainably. It could be important to checkthis free visual depiction ofwhat analysts expectfor the future.
Most shareholders would probably be pleased with Air Transport Services Group, Inc. for providing a total return of 87% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size.
Air Transport Services Group, Inc. is currently paying its CEO below what is normal for companies of its size. Since the business is growing, many would argue this suggests the pay is modest. And given most shareholders are probably very happy with recent returns, you might even think that Joe Hete deserves a raise!
Most shareholders like to see a modestly paid CEO combined with strong performance by the company. The cherry on top would be if company insiders are buying shares with their own money. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Air Transport Services Group (free visualization of insider trades).
Arguably, business quality is much more important than CEO compensation levels. So check out thisfreelist of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Boasting A 42% Return On Equity, Is LyondellBasell Industries N.V. (NYSE:LYB) A Top Quality Stock?
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One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine LyondellBasell Industries N.V. (NYSE:LYB), by way of a worked example.
Over the last twelve monthsLyondellBasell Industries has recorded a ROE of 42%. Another way to think of that is that for every $1 worth of equity in the company, it was able to earn $0.42.
View our latest analysis for LyondellBasell Industries
Theformula for ROEis:
Return on Equity = Net Profit ÷ Shareholders' Equity
Or for LyondellBasell Industries:
42% = US$4.3b ÷ US$10b (Based on the trailing twelve months to March 2019.)
It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company.
ROE 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, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies.
By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As is clear from the image below, LyondellBasell Industries has a better ROE than the average (15%) in the Chemicals industry.
That is a good sign. We think a high ROE, alone, is usually enough to justify further research into a company. For exampleyou might checkif insiders are buying shares.
Virtually all companies need money to invest in the business, to grow profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used.
LyondellBasell Industries has a debt to equity ratio of 0.97, which is far from excessive. The combination of modest debt and a very impressive ROE does suggest that the business is high quality. Judicious use of debt to improve returns can certainly be a good thing, although it does elevate risk slightly and reduce future optionality.
Return on equity is 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 the same ROE, then I would generally prefer the one with less debt.
But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. 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.
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Boeing Sets Aside $100M For 737 Max Crash Victims
Boeing(NYSE:BA)has set aside 0 million in fundsfor community needs of those affected by tragic accidents of Lion Air Flight 610 and Ethiopian Airlines Flight 302.
The funds will support education, hardship and living expenses for impacted families, community programs, and economic development. The investment will be made over multiple years.
On March 10, the Ethiopian Airlines Flight 302, a Boeing 737 MAX jet was scheduled from Addis Ababa Bole International Airport in Ethiopia to Jomo Kenyatta International Airport in Nairobi, Kenya the flight crashed near the town of Bishoftu six minutes after takeoff, killing all 157 people aboard.
The 737 Max jets have been grounded since March after two fatal crashes in five months.
Boeing shares traded around $352.89 at time of publicaiton. The stock is down more than 9% year to date.
Related Links:
The Boeing 737 MAX Has Been Grounded Since March: How Are Airlines Responding?
Delta's Solid Q2 Guidance Boosts Airline Stocks
Photo credit: Jeff Hitchcock, Wikimedia
See more from Benzinga
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© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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Is It Time To Consider Buying U.S. Concrete, Inc. (NASDAQ:USCR)?
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U.S. Concrete, Inc. (NASDAQ:USCR), which is in the basic materials business, and is based in United States, saw a significant share price rise of over 20% in the past couple of months on the NASDAQCM. With many analysts covering the stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. But what if there is still an opportunity to buy? Today I will analyse the most recent data on U.S. Concrete’s outlook and valuation to see if the opportunity still exists.
View our latest analysis for U.S. Concrete
Good news, investors! U.S. Concrete is still a bargain right now. My valuation model shows that the intrinsic value for the stock is $86.39, which is above what the market is valuing the company at the moment. This indicates a potential opportunity to buy low. Although, there may be another chance to buy again in the future. This is because U.S. Concrete’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity.
Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. In the upcoming year, U.S. Concrete’s earnings are expected to increase by 51%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.
Are you a shareholder?Since USCR is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.
Are you a potential investor?If you’ve been keeping an eye on USCR for a while, now might be the time to enter the stock. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy USCR. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on U.S. Concrete. You can find everything you need to know about U.S. Concrete inthe latest infographic research report. If you are no longer interested in U.S. Concrete, you can use our free platform to see my list of over50 other stocks with a high growth potential.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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This Free, No-Reno Trick Will Make Your Space Look So Much Bigger
Photo credit: Shophouse Design From House Beautiful Let's be honest: Sometimes the best solutions are the simplest ones, and that's certainly true in interior design. While there are myriad tricks in the book for making small spaces feel larger (proper rug placement, large-scale wallpaper, properly sized furniture), Betsy Helm and Kiley Baun of Shophouse Design, July/August 2019's Next Wave designers, may have offered up the simplest one yet. The duo's suggestion for instantly opening up a space (at least visually) requires no renovation, no remodeling, and—best of all—no cash. When asked for their best under-$100 trick to improve a space, the duo said "pull the furniture away from the wall!" Photo credit: Hearst Owned Creeping to the center of the room may sound counter-intuitive in a small space, but trust us—and these designers—it works. When all furniture is pushed to the edge, it creates a heavy border around the room, only emphasizing the small size. Having space behind furniture allows the room to breathe a bit, promoting light flow and instantly making it feel more open. Plus, having furniture arranged somewhere other than as absolutely far out as you can push it indicates there's more thought to the arrangement of furniture than just "get it out of the way as much as possible." So, if you're feeling a little cramped in your current home, try moving things around a bit—after all, if you decide you don't like it, you can just move it back. Follow House Beautiful on Instagram . ('You Might Also Like',) 7 Secrets HomeGoods Employees Won't Tell You 19 Closet Organization Ideas You'll Want to Steal Immediately 15 Styling Tricks That Make A Small Living Room Seem Bigger Than It Is
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Charges dropped against Phillies OF Herrera
Domestic violence charges against Philadelphia Phillies outfielder Odubel Herrera were dropped Wednesday in New Jersey. At a hearing in Atlantic City Municipal Court, prosecutor Kelley Blanchet said the case couldn't go forward without the cooperation of the alleged victim, who declined to press charges. Herrera was accused of domestic assault against his girlfriend on May 27 at the Golden Nugget Hotel and Casino in Atlantic City. Officers found the 20-year-old woman with "visible signs of injury to her arms and neck that was sustained after being assaulted by her boyfriend," police said at the time. The police report said scratches and "handprint markings" were found on her neck. Herrera, 27, was facing charges of simple assault and knowingly causing bodily injury. His girlfriend, Melany Martinez-Angulo told Judge Billie J. Moore through an interpreter that she didn't want to press charges and hadn't been pressured into that decision. Moore dismissed the case contingent upon Herrera completing counseling. His attorney, Thomas Calcagni, said Herrera would take part in counseling for 60 more days. Blanchet said prosecutors did not have enough evidence to pursue the case without the woman's testimony. The couple left the courthouse holding hands and declined to comment. Herrera has been on MLB-issued administrative leave since the incident, last playing May 26. Scott Lauber of The Philadelphia Inquirer reported after the hearing that Herrera will remain on administrative leave through Friday. The domestic violence policy agreed to by the league and the players association allows the commissioner to enact a punishment whether or not a player has been convicted of a crime, and a ruling on Herrera's status could come this weekend, according to the report. Herrera played in 39 games before the incident, batting .222 with one homer and 16 RBIs. He was an All-Star in 2016 when he batted .286 with a career-high 25 stolen bases. --Field Level Media
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Boeing pledges $100 million for families affected by deadly 737 Max crashes
Boeing (BA) is setting aside $100 million to help the families of the victims from the two tragic 737 Max crashes that killed over 300 people.
Boeing said the funds, dispersed over multiple years, will help finance “education, hardship and living expenses” for families and communities affected by the crash.
"We at Boeing are sorry for the tragic loss of lives in both of these accidents and these lives lost will continue to weigh heavily on our hearts and on our minds for years to come. The families and loved ones of those on board have our deepest sympathies, and we hope this initial outreach can help bring them comfort," said Dennis Muilenburg, Boeing chairman, president and CEO, in apress releaseon Wednesday.
The company also said its employees can make donations to the relief money, which Boeing will match through the end of 2019.
In October 2018, Lion Air Flight 610, a Boeing 737 Max 8, crashed near Indonesia killing all on board. Months later in March 2019, Ethiopian Airlines Flight 302, also a Boeing 737 Max 8, went down in Ethiopia, killing all on board.
The tragic crashes led to a worldwide grounding of the 737 Max. The U.S. airlines that fly the jet include Southwest Airlines (LUV), American Airlines (AAL) and United Continental (UAL).
"We know every person who steps aboard one of our airplanes places their trust in us. We are focused on re-earning that trust and confidence from our customers and the flying public in the months ahead,” Muilenberg noted.
Boeing is reportedly working with the Federal Aviation Administration on a software update for the grounded 737 Max jet.
Scott Gamm is a reporter at Yahoo Finance. Follow him on Twitter@ScottGamm.
More from Scott:
• The earnings picture for 2019 is showing more signs of deterioration
• The next rate cut is unlikely to be caused by weak growth, economist explains
• Why Trump should be worried about the stock market selloff
• What the plunging 10-year Treasury yield says about the economy and stock market
• Why one top strategist is bullish on tech even with lingering trade worries
Follow Yahoo Finance onTwitter,Facebook,Instagram,Flipboard,LinkedIn, andreddit.
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Are Investors Undervaluing Southwest Airlines Co. (NYSE:LUV) By 40%?
Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card!
In this article we are going to estimate the intrinsic value of Southwest Airlines Co. (NYSE:LUV) by projecting its future cash flows and then discounting them to today's value. I will use the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple!
Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
View our latest analysis for Southwest Airlines
We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value:
[{"": "Levered FCF ($, Millions)", "2020": "$2.7b", "2021": "$2.9b", "2022": "$2.9b", "2023": "$3.0b", "2024": "$3.1b", "2025": "$3.1b", "2026": "$3.2b", "2027": "$3.3b", "2028": "$3.4b", "2029": "$3.5b"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x6", "2021": "Analyst x1", "2022": "Est @ 1.76%", "2023": "Est @ 2.05%", "2024": "Est @ 2.25%", "2025": "Est @ 2.4%", "2026": "Est @ 2.5%", "2027": "Est @ 2.57%", "2028": "Est @ 2.62%", "2029": "Est @ 2.65%"}, {"": "Present Value ($, Millions) Discounted @ 8.54%", "2020": "$2.5k", "2021": "$2.4k", "2022": "$2.3k", "2023": "$2.2k", "2024": "$2.0k", "2025": "$1.9k", "2026": "$1.8k", "2027": "$1.7k", "2028": "$1.6k", "2029": "$1.5k"}]
("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= $20.0b
The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (2.7%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 8.5%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$3.5b × (1 + 2.7%) ÷ (8.5% – 2.7%) = US$61b
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$61b ÷ ( 1 + 8.5%)10= $26.97b
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $46.92b. The last step is to then divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of $86.39. Compared to the current share price of $51.43, the company appears quite good value at a 40% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent.
Now the most important inputs to a discounted cash flow are the discount rate, and of course, the actual cash flows. If you don't agree with these result, have a go at the calculation yourself and play with the assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Southwest Airlines as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 8.5%, which is based on a levered beta of 0.975. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price to differ from the intrinsic value? For Southwest Airlines, I've put together three relevant factors you should look at:
1. Financial Health: Does LUV have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does LUV's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of LUV? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the NYSE every day. If you want to find the calculation for other stocks justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Embraer’s New Praetor 600 Could Be the Best-Performing Super-Midsize Jet Ever Made
Click here to read the full article. New aircraft models come around rarely, but Brazil-based Embraer has a fresh one that’s about to take off. If the company’s right, and that’s a big if, the Praetor 600 business jet just might be “the best-performing super-midsize jet ever developed.” Embraer asserts that the Praetor 600 holds rank as the farthest-flying super-midsize jet because it can fly nonstop between London and New York, São Paulo and Miami, Dubai and London. With four passengers and significant fuel reserves, the jet has an intercontinental range of 4,018 nautical miles. And take-off airfield length for such a mission is only 4,436 feet, compared to 5,640 feet for the Bombardier Challenger 650 , which has a similar size, range and passenger capacity. The Praetor 600 is the first in its category with full fly-by-wire technology, which uses side-stick controls to reduce pilot workload and provide added safety. A special turbulence-reduction feature ensures a smooth and efficient flight. Okay, then, bring us on board. Related stories Cirrus vs. HondaJet: Which Makes the Best Personal Jet? The New Flying-V Jet, Inspired by a Gibson Guitar, Would Seat Passengers in the Wings From Private Jets to VTOLS, the 8 Best Aircraft of the Year Beyond performance, the plane features a six-foot-tall flat-floor cabin with eight fully reclining club seats (which transform into four beds), a full-size galley, a vacuum-service lavatory and a large wardrobe. The 5,800-foot cabin altitude will keep passengers comfortable and combat jet lag. With this new aircraft, Embraer introduces its top-notch Bossa Nova interior, “inspired by our Brazilian heritage,” says Jay Beever, vice president of interior design. The cabin features carbon-fiber materials, shiny piano-black details and stylized stitching inspired by the sidewalks of Rio de Janeiro’s Ipanema Beach. Dialing in the temperature, entertainment, blinds and lights, the Praetor 600’s tech panel also displays flight information and is available on personal devices through Honeywell Ovation Select. High-capacity and high-speed connectivity is offered via Viasat’s Ka-band, with speeds of up to 16 Mbps and unlimited streaming, even big files and movies. The cockpit features Collins Aerospace’s newest edition of the Pro Line Fusion flight deck, which includes a vertical weather display, air-traffic-control-like situational awareness, predictive wind-shear radar capability, an Embraer Enhanced Vision System with a head-up display (it’s transparent so the pilot doesn’t need to look down for info) and more. Two fuel-efficient Honeywell HTF7500E turbofan engines, reported as the greenest in their class, keep the aircraft moving. The jet should be ready to fly this month. Sign up for Robb Report's Newsletter . For the latest news, follow us on Facebook , Twitter , and Instagram .
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Is Atlantic Power Corporation (TSE:ATP) Trading At A 49% Discount?
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Today we will run through one way of estimating the intrinsic value of Atlantic Power Corporation (TSE:ATP) by taking the expected future cash flows and discounting them to today's value. I will be using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward.
Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model.
Check out our latest analysis for Atlantic Power
We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. In the first stage we need to estimate the cash flows to the business over the next ten years. Seeing as no analyst estimates of free cash flow are available to us, we have extrapolate the previous free cash flow (FCF) from the company's last reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years.
A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we need to discount the sum of these future cash flows to arrive at a present value estimate:
[{"": "Levered FCF ($, Millions)", "2020": "$77.2m", "2021": "$60.6m", "2022": "$51.8m", "2023": "$46.9m", "2024": "$44.0m", "2025": "$42.4m", "2026": "$41.6m", "2027": "$41.2m", "2028": "$41.2m", "2029": "$41.5m"}, {"": "Growth Rate Estimate Source", "2020": "Est @ -31.57%", "2021": "Est @ -21.51%", "2022": "Est @ -14.48%", "2023": "Est @ -9.55%", "2024": "Est @ -6.1%", "2025": "Est @ -3.69%", "2026": "Est @ -2%", "2027": "Est @ -0.81%", "2028": "Est @ 0.01%", "2029": "Est @ 0.59%"}, {"": "Present Value ($, Millions) Discounted @ 9.95%", "2020": "$70.2", "2021": "$50.1", "2022": "$39.0", "2023": "$32.1", "2024": "$27.4", "2025": "$24.0", "2026": "$21.4", "2027": "$19.3", "2028": "$17.6", "2029": "$16.1"}]
("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= $317.2m
The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (1.9%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 9.9%.
Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = US$41m × (1 + 1.9%) ÷ (9.9% – 1.9%) = US$529m
Present Value of Terminal Value (PVTV)= TV / (1 + r)10= $US$529m ÷ ( 1 + 9.9%)10= $204.83m
The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is $522.07m. To get the intrinsic value per share, we divide this by the total number of shares outstanding. This results in an intrinsic value estimate in the company’s reported currency of $4.76. However, ATP’s primary listing is in United States, and 1 share of ATP in USD represents 1.308 ( USD/ CAD) share of TSX:ATP,so the intrinsic value per share in CAD is CA$6.23.Relative to the current share price of CA$3.16, the company appears quite undervalued at a 49% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind.
The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Atlantic Power as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 9.9%, which is based on a levered beta of 1.342. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business.
Whilst important, DCF calculation shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price to differ from the intrinsic value? For Atlantic Power, I've put together three additional factors you should further research:
1. Financial Health: Does ATP have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk.
2. Future Earnings: How does ATP's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart.
3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of ATP? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing!
PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the TSE every day. If you want to find the calculation for other stocks justsearch here.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Top Ranked Growth Stocks to Buy for July 3rd
Here are four stocks with buy ranks and strong growth characteristics for investors to consider today, June 27th:
Oasis Midstream Partners LP(OMP): This provider of crude oil, natural gas and water-related midstream services, which carries a Zacks Rank #1 (Strong Buy), has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.9% over the last 60 days.
Oasis Midstream Partners LP Price and Consensus
Oasis Midstream Partners LP price-consensus-chart | Oasis Midstream Partners LP Quote
Oasis Midstream has a PEG ratio of 0.60, compared with 2.94 for the industry. The company possesses a Growth Scoreof B.
Oasis Midstream Partners LP PEG Ratio (TTM)
Oasis Midstream Partners LP peg-ratio-ttm | Oasis Midstream Partners LP Quote
United Continental Holdings, Inc.(UAL): This provider of air transportation services, which carries a Zacks Rank #2 (Buy), has witnessed the Zacks Consensus Estimate for its current year earnings increasing 0.2% over the last 60 days.
United Airlines Holdings Inc Price and Consensus
United Airlines Holdings Inc price-consensus-chart | United Airlines Holdings Inc Quote
United Continental has a PEG ratio of 0.38, compared with 0.56 for the industry. The company possesses a Growth Score of A.
United Airlines Holdings Inc PEG Ratio (TTM)
United Airlines Holdings Inc peg-ratio-ttm | United Airlines Holdings Inc Quote
JinkoSolar Holding Co., Ltd.(JKS): This photovoltaic products manufacturer, which carries a Zacks Rank #1 (Strong Buy), has witnessed the Zacks Consensus Estimate for its current year earnings increasing 0.3% over the last 60 days.
JinkoSolar Holding Company Limited Price and Consensus
JinkoSolar Holding Company Limited price-consensus-chart | JinkoSolar Holding Company Limited Quote
JinkoSolar has a PEG ratio of 0.38, compared with 1.69 for the industry. The company possesses a Growth Score of A.
JinkoSolar Holding Company Limited PEG Ratio (TTM)
JinkoSolar Holding Company Limited peg-ratio-ttm | JinkoSolar Holding Company Limited Quote
SeaWorld Entertainment, Inc.(SEAS): This theme park and entertainment company, which carries a Zacks Rank #1 (Strong Buy), has witnessed the Zacks Consensus Estimate for its current year earnings increasing 19.4% over the last 60 days.
SeaWorld Entertainment, Inc. Price and Consensus
SeaWorld Entertainment, Inc. price-consensus-chart | SeaWorld Entertainment, Inc. Quote
SeaWorld has a PEG ratio of 3.06, compared with 3.58 for the industry. The company possesses a Growth Score of A.
SeaWorld Entertainment, Inc. PEG Ratio (TTM)
SeaWorld Entertainment, Inc. peg-ratio-ttm | SeaWorld Entertainment, Inc. Quote
See thefull list of top ranked stocks here
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>
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 reportUnited Airlines Holdings Inc (UAL) : Free Stock Analysis ReportSeaWorld Entertainment, Inc. (SEAS) : Free Stock Analysis ReportOasis Midstream Partners LP (OMP) : Free Stock Analysis ReportJinkoSolar Holding Company Limited (JKS) : Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment Research
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Have Insiders Been Selling The Liberty SiriusXM Group (NASDAQ:LSXM.K) Shares?
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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 sellThe Liberty SiriusXM Group(NASDAQ:LSXM.K), you may well want to know whether insiders have been buying or selling.
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.'
View our latest analysis for Liberty SiriusXM Group
Over the last year, we can see that the biggest insider sale was by the , Richard Baer, for US$830k worth of shares, at about US$41.51 per share. So we know that an insider sold shares at around the present share price of US$38.60. While insider selling is a negative, to us, it is more negative if the shares are sold 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. Richard Baer was the only individual insider to sell over the last year.
You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love thisfreelist of companies. (Hint: insiders have been buying them).
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Liberty SiriusXM Group insiders own 10% of the company, worth about US$1.3b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
The fact that there have been no Liberty SiriusXM Group insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Liberty SiriusXM Group insider transactions don't fill us with confidence. Therefore, you should should definitely take a look at thisFREEreport showing analyst forecasts for Liberty SiriusXM Group.
Of courseLiberty SiriusXM Group may not be the best stock to buy. So you may wish to see thisfreecollection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor ateditorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
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Stock Market News: Tesla Delivers New Auto Records; Cannabis Pioneer Linton Out at Canopy Growth
Wednesday morning brought new highs for the stock market, as investors continued to believe that improved conditions for the global economy are right around the corner. The naming of Christine Lagarde to take Mario Draghi's place as head of the European Central Bank brought new optimism for Europe's struggling economy. As of 11:15 a.m. EDT, theDow Jones Industrial Average(DJINDICES: ^DJI) was up 95 points, to 26,882. TheS&P 500(SNPINDEX: ^GSPC) gained 14 points, to 2,987, and theNasdaq Composite(NASDAQINDEX: ^IXIC) was higher by 45 points, to 8,154.
In North America, a couple of high-profile news items had major implications for the companies involved.Tesla(NASDAQ: TSLA) got good news on the delivery front, validating CEO Elon Musk's assertions about the electric-vehicle specialist being able to meet its goals. On the other hand, the surprise departure ofCanopy Growth(NYSE: CGC) co-CEO Bruce Linton shocked many cannabis investors, even though the stock's response to the change in the executive suite was surprisingly muted.
Shares of Tesla climbed more than 6% Wednesday morning following the release ofsecond-quarter production and delivery informationfrom the carmaker. The company successfully delivered 95,200 vehicles during the period, setting a new quarterly record and reassuring those who had feared that ongoing logistical challenges might cause a disappointing set of numbers.
The gain in deliveries came entirely from skyrocketing movement of the mass-market Model 3 sedan. Tesla delivered 77,550 Model 3s during the period, which was more than quadruple the roughly 18,450 cars it delivered in the second quarter of 2018.
Elsewhere, some Tesla watchers were troubled by the fact that upscale Model S and Model X vehicles once again saw substantial year-over-year declines. Deliveries of the two higher-end models were down more than 20%, to 17,650. However, Tesla managed to get more of these vehicles to customers than they did during the first quarter of 2019, with sequential growth coming in at 46%.
Even more encouraging for Tesla shareholders is the fact that even with higher delivery numbers, backlog for outstanding orders grew. That signals that demand for the vehicles remains high, and most of those following Tesla expect that the company should be able to meet the target of 360,000 to 400,000 vehicle deliveries for the full 2019 year.
Shares of Canopy Growth were unchanged Wednesday morning as they recovered from losses of as much as 5% earlier in the session. The move followed news that Bruce Linton would step down from Canopy's board of directors and give up his co-CEO title.
Canopy tried to position the transition as a necessary step in the cannabis company's evolution. As Linton said in the press release announcing the move: "Creating Canopy Growth began with an abandoned chocolate factory and a vision. The board [of directors] decided today, and I agreed, my turn is over." Yet in interviews following the announcement, Linton said that the decision to terminate his employment wasn't voluntary.
Mark Zekulin, who was co-CEO with Linton, will remain in the role during a transition phase. Yet Zekulin acknowledges his own eventual destiny, saying that, "I personally remain committed to a successful transition over the coming year as we begin a process to identify new leadership that will drive our collective vision forward."
Going forward,Canopy will find outjust how important individual personalities are to the budding cannabis industry. Linton earned substantial respect for his achievements at Canopy, and his leadership likely opened doors where other executives wouldn't have been able to succeed. Shareholders seem convinced that the co-CEO's ouster won't hurt the company, but it's far from certain that Canopy will find a new leader who can match what Linton accomplished.
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Dan Caplingerhas no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Tesla. The Motley Fool has adisclosure policy.
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Democrats are fighting a dangerous battle against the profit motive
Profits are bad, according to many Democrats running for president.
“There are too many people profiteering off of the pain of people in America, from pharmaceutical companies to insurers,” Sen. Cory Booker of New Jersey said at the Democratic debate on June 26.
“The insurance companies last year alone sucked $23 billion in profits out of the health care system,” Sen. Elizabeth Warren of Massachusetts fumed in the same debate.
In another debate the following night, Sen. Kirsten Gillibrand of New York argued that “I would not be spending money in for-profit prisons to lock up children and asylum-seekers.”
And Bernie Sanders of Vermont insisted that “health care is a human right, not something to make huge profits off of.”
Are profits really that bad? Not if you count the efficiencies they create alongside the salaries and bonuses they put in the pockets of executives and shareholders.
Profits are an elemental component of capitalism. Without the prospect of financial gain, nobody would take risks on new businesses, new products or new ideas. An organization without profits is often one with lackluster management, unmotivated workers and angry customers.
We do shackle the profit motive for certain matters of public interest, such as delivering mail or providing energy to homes. The Sanders-Warren wing of the Democratic party now insists we should extend the same logic to health care, prescription drugs, prison management and even higher education.
This is dangerous thinking because it ignores what the profit motive actually accomplishes. To be profitable, private-sector companies must optimize efficiency. In a market with healthy competition, companies pass on some of the cost savings to consumers and continually improve their offerings, to lure new customers and increase revenue. Government, in a healthy system, sets and enforces rules assuring nobody cheats.
Capitalism has many flaws, but it’s usually better than government-run production with no profits. Warren talks as if moving to a single-payer health care system will leave everything the same, except there will be an extra $23 billion in former profits to spend on patient care. But this assumes efficiency in the health care system would remain the same, which it almost certainly wouldn’t.
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Doctors would get paid less in a government-run system, causing some to leave the field. There’d be minimal incentive to reduce patient wait times or improve care. And in place of pressure to boost profits there would be pressure to meet budgets and make sure no new tax revenue is required. Oh, there would also be meddling by self-interested and possibly corrupt politicians.
Economists haveargued for decadeswhether a publicly run health system, with no profit motive, would be better for patients and taxpayers than one with big for-profit providers. There’s no conclusive answer. The current system is a hybrid. Private insurance and out-of-pocket spending—the for-profit part of the health care industry—account for about 44% of the $3.8 trillion in annual spending on health in the United States. Government programs such as Medicare and Medicaid cover about 41%. There’s an important caveat, though: Medicare and Medicaid are government programs, but they mostly pay private-sector caregivers working at for-profit organizations.
There are other signs the for-profit health care industry works reasonably well. Arecent survey by the Kaiser Family Foundationfound that 61% of people who get insurance through an employer in the private system are satisfied with their coverage. Only 6% are deeply unsatisfied. That suggests the profit motive is working.
Warren, Sanders et. al. want to bring more of the US economy under government control, with Uncle Sam picking up the tab for college attendance, directing an overhaul of the energy and transportation sectors and perhaps evenmanufacturing some prescription drugs. Exerting government control might seem like a reliable way to solve pernicious problems. But government spending generates its own problems, such as thenotorious $600 toilet seats the Pentagon once purchased.And from time to time it becomes popular to move workoutof the government sector, because private contractors can often do the job cheaper, faster and better.
In the 1990s, for instance, President Bill Clinton pushed a “reinventing government” initiative focused on the kind of performance metrics common in business at the time. It was fashionable then to outsource government work—such as running prisons—to private contractors. The pendulum may be swinging back, but it’s worth recalling that critics have labeled government-run prisonsjust as inhumaneas some say privately run prisons are today. Windfall savings and dramatic improvements never seem to materialize as promised.
Rick Newman is the author of four books, including “Rebounders: How Winners Pivot from Setback to Success.” Follow him on Twitter:@rickjnewman
Confidential tip line:rickjnewman@yahoo.com.Encrypted communication available. Click here toget Rick’s stories by email.
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Iowa Supreme Court takes a right turn under Gov. Reynolds
DES MOINES, Iowa (AP) Republican Gov. Kim Reynolds is transforming the Iowa Supreme Court from one that leaned liberal to a solidly conservative body, prompting concerns among critics that it could erode past support for civil liberties as well as abortion and gay rights. Through a combination of coincidence, a mandatory retirement age of 72 for judges and changes in the selection process that favor Republicans, Reynolds could make the most appointments to the seven-member court since former Democratic Gov. Tom Vilsack named five from 1999 to 2007. Governor for just over two years, Reynolds already has appointed two justices one due to illness and another a retirement . One of her appointees is a member of the conservative Federalist Society, which has been instrumental in vetting judges for President Donald Trump's aggressive push to remake the federal courts. The current balance of the court is 5-2 Republican, although GOP appointee Chief Justice Mark Cady often sides with liberals. Reynolds will get to replace Brent Appel, a Democratic appointee, who turns 72 in 2022, the last year of her current term. If she runs and wins a second term as governor she could replace David Wiggins in 2023, the last retiring Democrat appointee and Cady in 2025 to complete the conservative transformation. It marks a stark contrast from the recent past, when an Iowa Supreme Court ruling in 2009 made it the third state in the nation to legalize same-sex marriage. As recently as 2018, the court established the foundation for a fundamental right to abortion under the Iowa constitution. Reynolds' appointments to the court were after that ruling. Since then the court majority has begun to assert itself. Last week in a 4-3 decision , the court concluded that police can continue to charge drivers with crimes they weren't initially stopped for, a practice civil rights groups say is racial discrimination. In May, the court supported by a 4-3 vote a 2017 law that removed bargaining rights for many state employees. Story continues Republicans this year used their advantage of control over the governor's office and majorities in both chambers of the Legislature to change the selection process for judges from a nonpartisan commission to one giving the governor more power. Under the previous system established in the 1960s, potential judges and justices were chosen by a commission made up of lawyers elected by lawyers and appointees named by the governor. The equal balance of legal professionals and political appointees was seen as a way to minimize political influence. The commission was chaired by the senior justice of the state Supreme Court. The commission reviewed applications for openings on the bench and sent three finalists to the governor, who names justices. Supreme Court justices in Iowa face retention elections every eight years and must earn a majority of votes to remain on the bench. Republicans complained that the lawyers appointed to the commission tended to be more to the left and sent liberal nominees to the governor. They cited a law professor's 2017 research suggesting that Iowa's courts leaned to the left of its citizens more than any state except New Hampshire of the 36 states that used judicial commissions to help select judges. "Iowa was near the top in terms of leftward judiciary," said Vanderbilt University law professor Brian Fitzpatrick, who studied 3,000 state appellate judges tracking campaign contributions, party registration and primary voting data to reflect political leaning. Reynolds signed into law in May a change that removed the senior Supreme Court justice as the chairman and replaced him with the governor's appointee , giving her a majority on the commission. "We're certainly concerned now because the governor does have more power and I think is more partisan," said Connie Ryan, chairwoman of Justice Not Politics, a group that pushes to keep politics out of the courts. The changes prompted several Democratic lawmakers to sue, saying the new law was legislative overreach and violated the state constitution. But the lawsuit was dismissed last week. The lawmakers have appealed to the Iowa Supreme Court. Religious conservatives are thrilled with the changes, hoping that a Republican-dominated court will endorse restrictions on abortion. "It's an improvement. Our biggest thing is to put power back to the people and get judges favorable to the constitution," said Bob Vander Plaats, an influential Christian conservative activist who heads a group called The Family Leader. "We believe the sanctity of human life is constitutional, that our plan for marriage is constitutional." ___ Follow David Pitt on Twitter: https://twitter.com/davepitt
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Megan Rapinoe gives thoughtful answer on her values as an American
LYON, France — Megan Rapinoe on Wednesday defended her outspoken political nature, tried to speak directly to her critics and labeled herself as “uniquely American” as her United States national team prepared for Sunday’s World Cup final. The American forward has long been a political activist. She found herself in a dust-up with Donald Trump earlier this tournament when a months-old video of her saying she wouldn’t go to the White House if the U.S. won the title resurfaced. Trump, in a series of tweets, encouraged her to focus on winning first and criticized her past kneeling during the pre-match national anthem as well as her current decision not to place her hand on her heart or sing the Star Spangled Banner. She now follows U.S. Soccer rules and "stands respectfully." Rapinoe has mostly responded on the field thus far, scoring four goals in the knockout stages for the Americans and positioning herself as a candidate for the Golden Ball, given to the most valuable player of a World Cup. On Wednesday, she was asked about people who don’t believe she is American enough to represent the national team. “I think I am particularly American and very deeply American, if you want to talk about the ideals that we stand for and what we were founded on,” Rapinoe said. “I think I am extremely American.” The 33-year-old from the timber country of Redding, California, is openly gay. She has been a vocal advocate for both her community and others that she says are marginalized in America, especially, she said, under the Trump Administration. She understands that rubs many the wrong way, including that she is talking about political issues at all. However, she says many of her statements stem from her trying to honestly answer questions posed to her and always being true to herself and her beliefs. “I think for the detractors, I would have them look and look hard on what I am actually saying [and] the actions I am doing,” Rapinoe said. “Maybe you don’t agree with every single way that I do it or [what] gets discussed. I know I am not perfect. Story continues Megan Rapinoe offered some thoughtful words on her values and what it means to be an American. (Getty) “But I know I stand for honesty and for truth and for wanting to have the conversation,” Rapinoe continued. “And for looking at the country honestly and saying, ‘Yes, we are a great country and there are so many things that are amazing and I feel very fortunate to be in this country.’ “I’d never be able to do this in a lot of other places,” Rapinoe acknowledged. “But also that doesn’t mean we can’t get better. That doesn’t mean we shouldn’t always strive to be better. I think this country was founded on a lot of great ideals but it was also founded on slavery. And I think we just need to be really honest about that and be really open talking about that so we can reconcile that and hopefully move forward and make this country better for everyone.” Rapinoe has declined to speak specifically about politics during this tournament, although she pointed anyone interested in her views or positions to research past comments. Her main focus, she said, is helping the United States win the World Cup again. Part of that is rehabbing a strained right hamstring injury that kept her out of a semifinal victory over England. She says she expects to be fully ready to play on Sunday against either Sweden or the Netherlands. Rapinoe said she was surprised when the video of her saying she wasn’t “going to the [expletive] White House” emerged during the tournament. It was an off-the-cuff remark during a behind-the-scenes filming of a photo shoot from nearly six months ago. “I don’t really plot these things out,” Rapinow said. “I say what I feel. I don’t ever say anything I’m really unsure about. I feel sure about everything I do say so [that] I feel confident and comfortable with dealing with it if it comes up later or comes around again. “I sort of live my life that way,” she continued. “I didn’t expect any of it but I expect all of it at the same time.” The video led to waves of criticism from Trump supporters, including some willing to now root for the U.S. to lose. (Trump, himself, is often seen during the anthem without his hand on his heart or singing the anthem, not that forced patriotism is very patriotic.) The fight has also increased Rapinoe’s profile and popularity on the opposite side of the spectrum. The battle was mostly about each figure – Trump and Rapinoe – winning additional support from their respective bases. Other than that, it was pretty much harmless and toothless. Megan Rapinoe isn't backing down from anything, and her teammates aren't backing down in support of her. (Getty) Rapinoe's teammates have rallied around her. The team is diverse in many ways – racially, geographically, politically and so on. There are young players and older ones. There’s a Bible study and prayer circle group that is a dozen strong. One player, Jessica McDonald, is a mother. Yet the team has expressed universal public support for Rapinoe and mostly ignored all outside talk, including that about White House visits or social media campaigns. “She stands up for what she believes in,” goalkeeper Alyssa Naeher said. “I have a lot of respect for her.” Rapinoe said she didn’t expect for Trump to condemn the White House visit remark, although considering the intensity of her past comments about him, it shouldn’t have been too surprising that he would defend himself. She’s called him almost every name in the book. “I expect him to have a lot better things to do before that got to the to-do list,” Rapinoe said. “I’m sure he skipped over a lot of things.” Standing in the bright sunlight in front of the team hotel on Wednesday afternoon here, as a bus idled awaiting to take the Americans to training, she was as calm and relaxed as ever. She answered the question asked of her. She didn’t bring it up. Yet she spoke with the same tone of voice and focus as anything about soccer. If nothing else, Rapinoe is wholly comfortable in her own skin and whether her politics mesh with everyone’s or not, she fully embraces the American ideal of speaking her mind and standing her ground. “I think becoming older and a little bit more just secure of myself, I’m probably becoming more brazen,” Rapinoe said. She certainly isn’t backing down now. Or ever. More from Yahoo Sports: What kept Rapinoe on the bench in USWNT’s win Twitter celebrates Morgan’s epic troll of England Tracing the timeline of KD and Kyrie’s plan to join Nets Root for the USWNT in style with our favorite apparel
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Walmart said to lose over $1B, weighs selling off money-losing online units
Walmart (WMT) is expected tolose at least $1 billion this year in its e-commerce divisionand may sell off money-losing units as the retail giant struggles to compete with Amazon (AMZN), according to a new report published on Wednesday.
Vox’s Recode cited multiple sources claiming Walmart’s efforts to challenge Amazon are falling short, leading to internal strains and a push to curb losses in its e-commerce division. The unit is projecting losses of over $1 billion on revenues between $21-22 billion, Vox reported.
According to the publication, Walmart is frustrated withJet— an online shopping site it purchased for $3.3 billion back in 2016. The mounting losses have put CEO Marc Lore on the hotseat with the company’s leadership, the report said.
Walmart’sboard of directors and CEO, Doug McMillon, want Lore and his online business to cut losses, Vox reported. They are also reportedly upset by the credit Lore’s division has received in the media and on Wall Street about Walmart’s huge online grocery shopping growth.
Besides improving internal tensions,Walmartwill look to sell at least one of its three fashion brands that was bought under Lore:Bonobosfor $310 million, Eloquii for $100 million and Modcloth for less than $50 million. All three businesses are unprofitable, Vox’s report said.
Walmart declined to comment on the story to Yahoo Finance.
The company, which is a retail powerhouse in its own right, has seen its stock rally to new 52-week highs near $112. That move came on the heels ofstrong quarter in which online sales skyrocketed 43%.
Although Walmartis bolstering its online shopping offerings,it’s been in a long battle to ward off the disruptive effect of Amazon, to little avail.
Lore is reportedly in favor of adding more fulfillment warehouses to aid in the delivery process.Walmarthas no more than 20 warehouses currently whileAmazonhas 110.
Donovan Russo is a writer for Yahoo Finance. Follow him@Donovanxrusso.
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