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2 Reasons to Buy Nio Stock Before 2022

InvestorPlace - Stock Market News, Stock Advice & Trading Tips Nio stock could be your best bet of 2022. There are two major catalysts driving the success story of Nio to will increase sales and revenue. The post 2 Reasons to Buy Nio Stock Before 2022 appeared first on InvestorPlace. More From InvestorPlace Stock Prodigy Who Found NIO at $2… Says Buy THIS Now Man Who Called Black Monday: “Prepare Now.” #1 EV Stock Still Flying Under the Radar Interested in Crypto? Read This First........»»

Category: topSource: investorplaceNov 24th, 2021

Why Should You Add ProAssurance (PRA) to Your Portfolio?

Riding on inorganic growth and cost-curbing measures, ProAssurance (PRA) holds the potential to reap benefits for investors. ProAssurance Corporation PRA is continuously favored by investors on the back of its growing revenues, cost-cutting initiatives and strategic measures. Operational and investment excellence also drive the stock.Over the past seven days, the stock has witnessed its 2021 earnings estimate move 2.1% north.Here we discuss the reasons for adding this currently Zacks Rank #2 (Buy) ProAssurance to your investment portfolio. You can see  the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Given PRA’s strong fundamentals, it is well-placed for long-term growth.ProAssurance achieved significant inorganic growth via successful acquisitions and integrations of companies. Its financial size and strength helped it in this regard.PRA also completed the NORCAL Mutual buyout, which intensified its focus on the Medical Professional Liability Insurance (MPLI) space and enhanced its size and scale in the same. This makes the combined entity the nation's third-largest specialty writer of liability insurance for healthcare professionals and facilities. The integration plan is expected to be concluded by 2022.The insurer witnessed solid gross premiums over a period, evident from its 2015-2019 revenue stream. The metric, however, declined in 2020 due to lower premiums across the Specialty P&C segment, Workers’ Compensation Insurance segment and the Segregated Portfolio Cell Reinsurance segment. In the first nine months of 2021, gross premiums written improved 22.5% from the prior-year comparable period’s level on the back of higher new business written and strong retention rates.ProAssurance is making concerted efforts to reduce its overall costs. Total expenses declined 12.1% in the first nine months of 2021 from the prior-year comparable period’s tally. PRA’s expense ratio fell in all segments in the first nine months of 2021, barring Segregated Portfolio Cell Reinsurance.PRA has a good solvency position on the back of cash inflows. As of Sep 30, 2021, it had cash and cash equivalents of $203 million, a revolving credit facility of up to $250 million and the possibility of a $50-million accordion feature. The insurance company has robust cash-generating abilities in place, which enabled it to pursue growth-related initiatives and prudently deploy capital through share repurchases and dividend payments.ProAssurance is poised well for growth owing to solid volumes and a diversified footprint.However, we are concerned about its high expenses, which are likely to put pressure on its margins going forward.The insurer’s 2021 earnings estimate stands at 97 cents, indicating an upside of 286.5% from the year-ago reported figure.Price PerformanceShares of this property and casualty (P&C) insurer have gained 30.2% year to date compared with the industry’s growth of 9.3%. Image Source: Zacks Investment ResearchOther top-ranked stocks in the insurance space are Berkshire Hathaway (BRK.B), RLI Corp. RLI and Kinsale Capital Group KNSL. While Berkshire Hathaway and RLI Corp. currently have a Zacks Rank #2 (Buy), Kinsale Capital sports a Zacks Rank #1 (Strong Buy).Berkshire Hathaway owns more than 90 subsidiaries in insurance, rail roads, utilities, manufacturing services, retail and home building. BRK.B managed to deliver trailing a four-quarter surprise of 5.53%. Its shares have gained 21.7% year to date.RLI Corp. is a specialty property-casualty (P&C) underwriter that caters primarily to the niche markets through its main operating subsidiary RLI Insurance Company. RLI’s shares have gained 6.3% in the past year. RLI’s earnings managed to surpass estimates in all the trailing four quarters, the average being 39.84%.Kinsale Capital offers various insurance and reinsurance products across all 50 states of the United States, the District of Columbia, the Commonwealth of Puerto Rico and the U.S. Virgin Islands. KNSL came up with a trailing four-quarter surprise of 37.6%, on average, and the stock has gained 3.6% year to date. Tech IPOs With Massive Profit Potential: Last years top IPOs surged as much as 299% within the first two months. With record amounts of cash flooding into IPOs and a record-setting stock market, this year could be even more lucrative. See Zacks’ Hottest Tech IPOs Now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report RLI Corp. (RLI): Free Stock Analysis Report Berkshire Hathaway Inc. (BRK.B): Free Stock Analysis Report ProAssurance Corporation (PRA): Free Stock Analysis Report Kinsale Capital Group, Inc. (KNSL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 30th, 2021

Should You Buy the Dip on the Omicron Scare?

We can make the most of the current volatility in the market to load up on some shares. The stock markets went into a bit of a tizzy Friday, as fears of a new variant of the coronavirus hit the markets. Omicron, as it’s being called, appears to have originated in South Africa and has now been detected in a number of European countries, as well as Canada, Israel, Hong Kong and Australia. A number of countries have imposed travel restrictions from South African countries.Early reports do, however, indicate that the variant while being more contagious, is doing less damage than Delta. But who knows how things will finally play out?So yes, people are scared. They are not rushing outdoors and thinking that maybe there will be lockdowns or partial lockdowns all over again.In response to the uncertainties, investors piled into bonds on Friday, ditching stocks, especially the reopening plays like airlines, restaurants and retail. As may be expected, the vaccine makers were more in demand, especially Moderna, which was quick to say that it would have a vaccine for Omicron in early 2022.But investors returned to the market by Monday to take advantage of the dip. So major indexes are again in the green. What’s more, the volatility index (VIX) is down over 12% as of this writing, indicating that investors are back in action.  So there’s a narrow window of opportunity for those still hoping to buy the dip. And SNDR, ARCB, ARW, CC and CLS could help you do just that-Schneider National Inc. SNDRSchneider is a leading transportation and logistics services company offering premier truckload, intermodal, dry van, bulk transport and supply chain management. It has one of the largest for-hire truck fleets in North America.Reopening encourages people to use more services while the virus pushes people back indoors, making it more of a goods economy. So any virus scare is generally advantageous for companies that deal in goods. Plus truckers are currently in huge demand because of supply chain issues.Analysts are optimistic about Schneider’s growth prospects in 2022 and think that its revenue and earnings will be up 6.5% and 4.1%, on top of the very strong double-digit growth this year. The estimate revisions trend is also encouraging, with the 2022 estimate climbing 13.2% in the last 90 days.That’s why Schneider’s 1.4% dip over the past week does not make much sense and may be considered an opportunity to buy.Supporting that thesis is the valuaton. Schneider trades at 11.4X 2022 earnings (P/E), 0.85X sales (P/S) and 0.66X earnings growth (PEG).The shares carry a Zacks Rank #1 (Strong Buy).ArcBest Corporation ARCBArcbest offers freight transportation services and solutions for road, air and ocean transportation of goods, as well as customizable supply chain solutions and integrated warehousing services in the U.S. and internationally.So the factors helping Schneider at the moment also apply to Arcbest.Additionally, analysts are extremely optimistic about the company’s growth in 2022. Even coming off the strong double-digit growth this year, they expect the company to grow its earnings by 15.2% on revenue that’s expected to grow 18.7%. The estimate revisions trend is positive with the 2022 earnings estimates having jumped 41.3% over the past 90 days.Therefore, the 4.0% decline in its share prices over the past week doesn’t make much sense. But it does help the valuation, which is attractive to say the least. Arcbest shares currently trade at a P/E multiple of 12.0X, a P/S multiple of 0.75X and a PEG ratio of 0.30X.The shares carry a Zacks Rank #1.Arrow Electronics Inc. ARWArrow Electronics is one of the world’s largest distributors of electronic components and enterprise computing products. It also offers value-added-services.Being an enabler of the digital economy, Arrow stands to gain from the growing volumes of online sales, remote working and other digitally dependent activity. And as we all know, digitization has accelerated over the past year because of the pandemic.So Arrow has seen good growth over the past year and analysts expect more to follow this year. They currently see earnings growing 6.5% in 2022 on revenue growth of 1.5%. The estimate revisions trend (up 9.0% in the last 90 days) indicates that final growth numbers could be considerably stronger.So the 1.8% decline in Arrow’s share prices is an invitation to buy. Especially because its valuation based on P/E of 8.0X, P/S of 0.25X and PEG of 0.31 makes it really cheap at these levels.The shares carry a Zacks Rank #2 (Buy).The Chemours Company CCChemours is a leading provider of performance chemicals that are key ingredients in end-products and processes across a host of industries including plastics and coatings, refrigeration and air conditioning, mining and general industrial manufacturing and electronics.Industrial production and manufacturing activity has picked up as far as possible given materials and labor constraints. And tightness in the supply chain is allowing Chemours to pass on raw material cost inflation to customers.The possibility of a slowdown in the economy, or of a slowdown in manufacturing and industrial operations, is therefore a bit of a concern for Chemours and explains the 2.8% decline in its share prices over the past week.But the estimate revisions trend remains positive as of now with the 2022 earnings estimate up 10.6% in the last 90 days. Moreover, analysts are looking for 8.2% earnings growth in 2022 on top of the 105.5% growth this year. The revenue growth estimate of 6.4% is also encouraging.Chemours’ valuation is also attractive with P/E, P/S and PEG at 7.03X, 0.83X and 0.22, respectively.The shares carry a Zacks Rank #1.Celestica Inc. CLSCelestica is one of the largest electronics manufacturing services companies in the world, serving the computer, and communications sectors. The company provides competitive manufacturing technology and service solutions for printed circuit assembly and system assembly, as well as post-manufacturing support to many of the world's leading original equipment manufacturers.Given the nature of its business, Celestica is a beneficiary of the increased digitization over the past year and a half. Coronavirus-related shutdowns/restrictions would increase our digital dependency, which would be positive for a company like Celestica. But there are many other reasons for increased digitization, which is the way the world is moving. One concern is related to infection rates, which if they hit the electronics supply chain can be a big impediment for the company. That’s probably why we’ve seen its shares retreat 3.9% over the past week.The lone analyst providing estimates on Celestica sees revenue and earnings growth of 12.4% and 19.8%, respectively in 2022. And he appears to have erred on the side of caution for the most part, in the past. The 2022 estimate is up 17.3% over the past 90 days.Celestica’s valuation is also attractive, as seen from its P/E multiple of 7.3X, P/S of 0.25X and PEG of 0.86.Celestica shares carry a Zacks Rank #2.3 Month Price MovementImage Source: Zacks Investment Research Investor Alert: Legal Marijuana Looking for big gains? Now is the time to get in on a young industry primed to skyrocket from $13.5 billion in 2021 to an expected $70.6 billion by 2028. After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could kick start an even greater bonanza for investors. Zacks Investment Research has recently closed pot stocks that have shot up as high as +147.0% You’re invited to immediately check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.Today, Download Marijuana Moneymakers 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 report Arrow Electronics, Inc. (ARW): Free Stock Analysis Report Celestica, Inc. (CLS): Free Stock Analysis Report ArcBest Corporation (ARCB): Free Stock Analysis Report The Chemours Company (CC): Free Stock Analysis Report Schneider National, Inc. (SNDR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 29th, 2021

After "Red Friday" Rout, Will The Fed Slow Their Roll?

After 'Red Friday' Rout, Will The Fed Slow Their Roll? Authored by Lance Roberts via RealInvestmentAdvice.com, “Black Friday” As Market Plunges Last week, we discussed the weakness of the underlying market as “FOMO” had returned to the market. “The only concern we have is the lack of breadth as of late. As shown, the number of stocks above the 50-dma turned sharply lower this week. Furthermore, they are well below levels when markets typically make new highs. The same goes for the number of stocks trading above their 200-dma’s.” Chart updated through Friday. Over the last couple of weeks, the market has been warning to the risk of a downturn, all that was needed was a catalyst to change sentiment. That occurred as news of a new “Covid” variant broke, stocks marked “Black Friday” by plunging firmly through the 20-dma and support at recent lows. Notably, that downside break broke the consolidation pattern (blue box in the chart below) that began in early November. While there is some minor support around 4550, critical support lies at the 50-dma at 4527. That support level also corresponds to the September peak. With mutual fund distributions running through the first two weeks of December, there is additional downside pressure on stocks near term. However, our “money flow sell” signal is firmly intact and confirmed by the MACD signal. Such suggests we continue to maintain slightly higher levels of cash. Notably, the market is getting oversold near-term, with the money-flow signal depressed. Such suggests that any further weakness will provide a short-term trading opportunity. As discussed last week, the statistical odds are high that we will see a “Santa Rally” as most professional managers will position for year-end reporting. Just remember, nothing is guaranteed. We can only make educated guesses. Will The Fed Slow Their Roll While “Black Friday” usually marks the beginning of the retail shopping season, the question is whether the new “variant,” which is flaring concerns of additional lock-downs, will reverse the current economic recovery. As Barron’s notes, it will be worth watching the Fed closely. “Fixed-income markets are signaling that the Federal Reserve will have to increase interest rates sooner than expected, which could put a dent in the stock market. The yield on the 2-year Treasury note has gone from 0.5% in early November to 0.64% as of Wednesday. The move suggests that investors expect the Fed to raise interest rates to combat inflation that remains higher than expected because of soaring consumer demand and supply chains that are struggling to match demand. Indeed, minutes released Wednesday from the Fed’s meeting earlier this month show that members of the central bank are prepared to increase rates sooner than previously anticipated if inflation remains high.” Of course, this was before “Black Friday” sent yields plunging 10% lower in a single day. Suddenly, the bond market is starting to question the sanity of hiking rates in the face of an ongoing pandemic. While many pundits have suggested higher interest rates won’t matter to stocks, as we will discuss momentarily, they do matter and often matter a lot. The surge in the new variant gives the Fed an excuse to hold off tightening monetary policy even though inflationary pressures continue to mount. But, what is most important to the Fed is the illusion of “market stability.” What “Black Friday’s” plunge showed was that despite the Fed’s best efforts, “instability” is the most significant risk to the market and you. More on this in a moment. Time To Buy Oil? Once a quarter, I review the Commitment Of Traders report to see where speculators place their bets on bonds, the dollar, volatility, the Euro, and oil. In October’s update, I looked at oil prices that were then pushing higher as speculators were sharply increasing their net-long positioning on crude oil. We suggested then that “the current extreme overbought, extended, and deviated positioning in crude will likely lead to a rather sharp correction. (The boxes denote previous periods of exceptional deviations from long-term trends.) The dollar rally was the most crucial key to a view of potentially weaker oil prices. Given that commodities are globally priced in U.S. dollars, the strengthening of the dollar would reduce oil demand. To wit: “The one thing that always trips the market is what no one is paying attention to. For me, that risk lies with the US Dollar. As noted previously, everyone expects the dollar to continue to decline, and the falling dollar has been the tailwind for the emerging market, commodity, and equity ‘risk-on trade.” – June 2021 Since then, as expected, the dollar rally is beginning to weigh on commodity prices, and oil in particular. While the dollar could certainly rally further heading into year-end, oil prices are becoming much more attractive from a trading perspective. The recent correction did violate the 50-dma, which will act as short-term resistance. However, prices are beginning to reach more attractive oversold levels. There are also reasons to believe higher oil prices are coming. Higher Oil Prices Coming The Biden administration released oil from the “Strategic Petroleum Reserve,” attempting to lower oil prices. He also tasked the DOJ to “investigate oil companies for potential price gouging.” These actions are thinly veiled attempts to regain favor with voters but will not lower oil prices. Oil prices are NOT SET by producers. Instead, speculators and hedgers set oil prices on the NYMEX. Think about it this way: If oil companies are setting prices to “reap profits,” why did oil prices go below ZERO in 2020? Furthermore, would producers need to “hedge” current production against future delivery? There are two drivers reflecting positioning by speculators and hedgers: The expected supply and demand for oil; and, The value of the dollar. The more critical problem comes from the Administrations’ attack on production over “climate change” policies. As noted in Crude Investing: Energy Stocks & ESG (kailashconcepts.com): “This isn’t rocket science.  Look at the sharply lagging rig response to the rise in energy prices post the Covid crash. This is an anomaly.  According to history, there should be ~1,300 rigs in operation today based on current oil prices. With only ~480 rigs running today, oil’s prospects may be bright over the long haul.” With output at such low levels, OPEC+ refusing to increase production, and “inefficient clean energy” increasing demand on “dirty energy,” higher future prices are likely. If the economy falls into a tailspin, oil prices will fall along with demand, so nothing is assured. However, the ongoing decline in CapEx in the industry suggests production will continue to contract, leaving it well short of future demand. Chart courtesy of Kailash Concepts That is the perfect environment for higher prices. Higher Interest Rates Will Lead To Market Volatility Did “Black Friday’s” plunge send a warning about rates? Last week, we discussed that it isn’t a question of if, but only one of when. I showed the correlation between interest rates and the markets. With the sharp drop in rates, it is worth reminding you of the analysis. It is all about “instability.” The chart below is the monthly “real,” inflation-adjusted return of the S&P 500 index compared to interest rates. The data is from Dr. Robert Shiller, and I noted corresponding peaks and troughs in prices and rates. To try and understand the relationship between stock and bond returns over time, I took the data from the chart and broke it down into 46 periods over the last 121-years. What jumps is the high degree of non-correlation between 1900 and 2000. As one would expect, in most instances, if rates fell, stock prices rose. However, the opposite also was true. Rates Matter Notably, since 2000, rates and stocks rose and fell together. So bonds remain a “haven” against market volatility. As such, In the short term, the markets (due to the current momentum) can DEFY the laws of financial gravity as interest rates rise. However, as interest rates increase, they act as a “brake” on economic activity. Such is because higher rates NEGATIVELY impact a highly levered economy: Rates increases debt servicing requirements reducing future productive investment. Housing slows. People buy payments, not houses. Higher borrowing costs lead to lower profit margins. The massive derivatives and credit markets get negatively impacted. Variable rate interest payments on credit cards and home equity lines of credit increase, reducing consumption. Rising defaults on debt service will negatively impact banks which are still not as well capitalized as most believe. Many corporate share buyback plans and dividend payments are done through the use of cheap debt. Corporate capital expenditures are dependent on low borrowing costs. The deficit/GDP ratio will soar as borrowing costs rise sharply. Critically, for investors, one of the main drivers of assets prices over the last few years was the rationalization that “low rates justified high valuations.” Either low-interest rates are bullish, or high rates are bullish. Unfortunately, they can’t be both. What “Black Friday’s” plunge showed was the correlation between rates and equity prices remains. Such is due to market participants’ “risk-on” psychology. However, that correlation cuts both ways. When something changes investor sentiment, the “risk-off” trade (bonds) is where money flows. The correlation between interest rates and equities suggests that bonds will remain a haven against risk if something breaks given exceptionally high market valuations. The market’s plunge on “Black Friday” was likely a “shot across the bow.” It might just be worth evaluating your bond allocation heading into 2022. Tyler Durden Sun, 11/28/2021 - 10:30.....»»

Category: blogSource: zerohedgeNov 28th, 2021

4 Reasons Why You Should Add Sarepta (SRPT) to Your Portfolio

Sarepta's (SRPT) stock creates a significant opportunity for investors on the back of solid demand for its commercialized drugs and steady progress with its key pipeline candidates. Sarepta Therapeutics SRPT concentrates on developing exon-skipping drug candidates targeting Duchenne muscular dystrophy (DMD), a rare genetic disorder affecting children and also the most common type of muscular dystrophy. SRPT’s top line is driven by its three FDA-approved DMD drugs, namely Exondys 51, Vyondys 53 and Amondys 45.Sarepta is also developing gene therapies targeting different muscular dystrophies and central nervous system disorders. Its lead gene therapy candidate SRP-9001 is being developed in a pivotal study as a potential treatment of DMD.Here we discuss four reasons why adding the Sarepta stock to one’s portfolio may prove to be beneficial in 2021.Top Rank, Rising Estimates and Share Price: Sarepta currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Earnings estimates for Sarepta’s loss per share have narrowed 28.2% for 2021 and 25.3% for 2022 over the past 30 days.  The stock has gained 5.3% in the past six months against a decrease of 12.3% for the industry.Image Source: Zacks Investment ResearchStrong Performance of DMD Drugs: Sarepta’s Exondys 51 is the first approved disease-modifying therapy for DMD in the United States and its first product to receive marketing approval. Exondys 51 recorded impressive sales growth in the last few quarters despite the COVID-19 pandemic. Vyondys 53, approved in 2019, is boosting SRPT’s top line by bringing in additional sales. Moreover, Amondys 45 has been showing a strong demand trend since its launch earlier in 2021.Strong performance of its three DMD drugs in the first nine months of 2021 led Sarepta to raise its revenue guidance for 2021 on its third quarter earnings call. SRPT expects product revenues in the range of $605-$615 million, indicating growth of nearly 34% from the year-ago reported figure at the midpoint. We expect robust growth in product revenues to continue in 2022.Gene Therapy Pipeline: Sarepta is one of the pioneers in gene therapy development. Earlier this year, SRPT initiated the first pivotal study — EMBARK — to evaluate a gene therapy candidate for DMD patients.In January 2021, management had announced that SRP-9001 met the biological endpoint of a mid-stage study during its evaluation in DMD patients but failed to achieve a statistically significant improvement in the functional endpoint of the study. This caused a massive decline in Sarepta’s share price in the same month. However, SRPT advanced the development of SRP-9001 to the pivotal EMBARK study based on favorable trends observed for function endpoint in the mid-stage study.The pivotal study is also evaluating commercially-represented material for SRP-9001. Any positive update from the pivotal study will be a key catalyst for the stock. Sarepta is developing the micro-dystrophin-encoding gene therapy candidate in collaboration with Roche RHHBY.Sarepta and Roche entered into a licensing agreement to develop SRP-9001 in 2019. Per the agreement, Roche has exclusive rights to launch and commercialize SRP-9001 in the ex-U.S. markets. Roche made $1.15-billion upfront payments and will pay up to $1.7 billion in regulatory and sales milestones to Sarepta.Apart from DMD, Sarepta is developing gene therapies for treating Limb-girdle muscular dystrophy, Mucopolysaccharidosis type IIIA (MPS IIIA) and Pompe Disease in different clinical-stage studies.Next-Generation Exon-Skipping Pipeline: Sarepta is looking to build its DMD pipeline beyond PMO-based exon-skipping treatments. SRPT is developing SRP-5051, an exon 51 skipping candidate from SRPT’s next-generation PPMO-technology, for treating DMD patients. The new technology aided in achieving a more durable response compared to PMO.SRP-5051 targets a similar patient population as that of Sarepta’s lead drug Exondys 51. The candidate showed significantly better responses in patients with its once-monthly doses in clinical studies than the once-weekly doses of Exondys 51.Successful development will offer DMD patients a better alternative with a much lower dose and a new drug with longer patent protection. SRPT initiated the pivotal part B of the MOMENTUM study in the fourth quarter of 2021.ConclusionStrong demand for its commercial DMD drugs and promising pipeline progress represents an opportunity for investors to gain from Sarepta’s potential growth over the next few quarters. On the flip side, shares of SRPT declined more than 50% on Jan 8, 2021, following a negative clinical update on its DMD gene therapy candidate, SRP-9001. However, any positive update from the ongoing pivotal study on SRP-9001 will likely be a catalyst for the stock’s substantial upside going forward.A few other companies also developing gene therapies targeting DMD patients are Pfizer PFE and REGENXBIO RGNX. Successful development of these gene therapy candidates may increase competition for Sarepta.Pfizer began dosing in the phase III CIFFREO study last December. The study is evaluating the safety and efficacy of its gene therapy candidate PF-06939926 for treating DMD. Pfizer is the closest competitor of Sarepta in developing a DMD gene therapy with both companies evaluating their respective candidates in late-stage studies. Pfizer’s DMD candidate enjoys fast track, orphan drug and rare pediatric disease designations in the United States.REGENXBIO plans to start a clinical study next year to evaluate its gene therapy candidate RGX-202 for treating DMD. RGX-202 was designed using REGENXBIO's proprietary NAV AAV8 vector to deliver an optimized microdystrophin transgene to develop a targeted therapy for improved resistance to muscle damage associated with DMD. REGENXBIO received an orphan drug designation for the candidate earlier this month.Sarepta Therapeutics, Inc. Price Sarepta Therapeutics, Inc. price | Sarepta Therapeutics, Inc. Quote Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Roche Holding AG (RHHBY): Free Stock Analysis Report Pfizer Inc. (PFE): Free Stock Analysis Report Sarepta Therapeutics, Inc. (SRPT): Free Stock Analysis Report REGENXBIO Inc. (RGNX): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 26th, 2021

Pfizer (PFE) COVID Vaccine & Pill Drive Stock Up This Year

Pfizer's (PFE) stock is up 38.8% this year so far, riding high on the success of its two-shot vaccine for COVID-19. Pfizer’s PFE stock has risen 38.8% this year so far, outperforming an increase of 14.5% for the industry.Image Source: Zacks Investment ResearchThe increase is mainly related to Pfizer’s success with COVID-19 vaccine and medicines for treating the disease, which is expected to significantly boost its revenues in 2022 and thereafter. No company is as strongly placed in the COVID vaccines/treatment market as Pfizer right now.Here we discuss the reasons in detail.A Successful COVID-19 VaccinePfizer has been riding high on the success of its two-shot vaccine for COVID-19, Comirnaty, which it developed in partnership with Germany-based company, BioNTech BNTX. The vaccine was developed in record time and is now approved for emergency/temporary use in several countries and has become a key contributor to the top line.In the first nine months of 2021, the vaccine contributed $24.3 billion to Pfizer’s global sales. The pharma giant expects to record $36.0 billion in revenues from Comirnaty in 2021.Pfizer and BioNTech have already shipped 2 billion doses to 152 countries. They expect to manufacture in total up to 3 billion doses by the end of December 2021. Pfizer and BioNTech’s vaccine was approved for younger patients (5-17 years) while a booster vaccine dose was also approved in the United States in 2021.A COVID Anti-Viral Pill on Its WayPfizer has filed an application to the FDA seeking Emergency Use Authorization (EUA) for its promising oral antiviral candidate for COVID-19, Paxlovid, for the treatment of mild-to-moderate COVID-19 in patients at increased risk of hospitalizations or deathPfizer’s regulatory application was based on clinical data from an interim analysis of a phase II/III study, EPIC-HR study. Data from the study showed that Paxlovid (administered in combination with low dose ritonavir) reduced the risk of hospitalization or death by 89% in non-hospitalized adult patients with COVID-19 at high risk of progressing to severe illness compared to placebo within three days of symptom onset. Similar benefits were observed in patients treated within five days of symptom onset.At the recommendation of an independent Data Monitoring Committee, Pfizer stopped the study early due to the high efficacy observed in the interim analysis. Pfizer has begun rolling submissions in several countries including the United Kingdom, Australia, New Zealand and South Korea.If approved by the FDA, Paxlovid can be the first oral antiviral medicine, which can be prescribed as at-home treatments for mild-to-moderate COVID-19 to reduce the severity of the disease. It can help prevent hospitalization in patients with a mild-to-moderate form of the disease but at a high risk of severe COVID-19.Strong Pipeline and Collaboration DealsPfizer boasts a sustainable pipeline with multiple late-stage programs that can drive growth.Pfizer has committed a significant number of resources toward the development of treatments in the fields of oncology, internal medicine, rare diseases, immunology, inflammation, vaccines and hospital. In fact, its phase III success rate, on a five-year rolling average, has improved from 70% to 85%.In 2021, Pfizer’s Prevnar-20, a 20-valent pneumococcal conjugate vaccine, was approved in the United States in June. Prevnar-20 is under review in the EU.Regulatory applications for some of its pipeline candidates are under review including Cibinqo/abrocitinib, its JAK selective inhibitor for atomic dermatitis and somatrogon to treat children with growth hormone deficiency. FDA decisions for these applications are expected next year, which, if approved, could bring in more new products for the company.Key cancer drug, Bavencio (avelumab) is being evaluated for different types of cancer while being already approved for Merkel cell carcinoma and in combination with Inlyta for first-line treatment of advanced kidney cancer.Pfizer is also working on expanding the labels of approved products like Ibrance, Xeljanz, Xalkori and Eliquis.ConclusionOverall, the Consumer Healthcare (CHC) joint venture with Glaxo GSK and the merger of the Upjohn unit with Mylan (now Viatris [VTRS]) has made this Zacks #3 Ranked stock a smaller company with a diversified portfolio of innovative drugs and vaccines.Pfizer’s CHC segment, an over-the-counter (OTC) medicines business, was merged with Glaxo’s unit in July 2019 to form a new joint venture (JV).  Pfizer owns a 32% stake in the JV and Glaxo owns the remaining 68%.Pfizer completed the transaction to divest its Upjohn Business and combine it with Mylan N.V. to form Viatris in November last year. However, its Upjohn unit was a cash-rich business and its divestiture to Viatris has reduced the company’s cash flowNonetheless, Pfizer’s stock is expected to continue to do well, driven by strong growth of key brands like Ibrance, Inlyta and Eliquis, revenue contribution from its COVID-19 vaccine and potentially the COVID pill and regular positive pipeline and regulatory updates.Pfizer currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>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 GlaxoSmithKline plc (GSK): Free Stock Analysis Report Pfizer Inc. (PFE): Free Stock Analysis Report BioNTech SE Sponsored ADR (BNTX): Free Stock Analysis Report Viatris Inc. (VTRS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

Thanks to Wall Street for a Wonderful Rally YTD: 5 Top Picks

We have narrowed the search to five U.S. corporate behemoths that have skyrocketed more than 50% year to date. These are: GOOGL, TSLA, LOW, HD and XOM. Wall Street started 2021 from where it ended in 2020. Year to date, U.S. stock markets have seen an impressive rally after completing an astonishing 2020 despite being pandemic-ridden. Instead of the technology-driven rally like last year, Wall Street is witnessing a broad-based rally this year — across all segments (large, mid and small caps) and various sectors of the economy. Very few economists and financial analysts had anticipated such a powerful rally at the beginning of this year.At this stage, it will be prudent to invest in corporate giants that have popped in 2021 with a favorable Zacks Rank and strong upside left. Here are five such stocks — Tesla Inc. TSLA, Alphabet Inc. GOOGL, The Home Depot Inc. HD, Exxon Mobil Corp. XOM and Lowe's Companies Inc. LOW.Impressive 2021 So FarWall Street has had a dream run so far this year. The pandemic is not over yet and the resurgence of the Delta variant of coronavirus disrupted U.S. economic recovery this summer. To make the situation worse, inflation is currently at its peak in more than three decades thanks to prolonged global supply-chain bottleneck and acute labor shortage.Despite these headwinds, year to date, the three large-cap centric indexes — the Dow, the S&P 500 and the Nasdaq Composite — have surged 17%, 24.9% and 22.4%, respectively. The small-cap specific Russell 2000 and S&P 600 Index have advanced 17.9% and 28.1%, respectively. The mid-cap benchmark S&P 400 Index has surged 24.6% in the same period.Year to date, all 11 broad sectors of the market’s benchmark – S&P 500 Index – are in positive territory. Aside from the technology sector, cyclical sectors like energy, financials, consumer discretionary, materials and industrials have contributed significantly to the S&P 500 rally.The momentum of U.S. stocks markets is likely to continue and will pave the way for a year-end rally. Here are the reasons:Government’s Spending PlansOn Nov 15, President Joe Biden signed a bipartisan infrastructure bill of $550 billion in addition to the previously approved funds of $450 billion for five years. Total spending may go up to $1.2 trillion if the plan is extended to eight years.The infrastructure development project will be a major catalyst for the U.S. stock markets in 2022. Various segments of the economy such as basic materials, industrials, telecommunications and utilities will benefit immensely with more job creation for the economy.On Nov 19, the House of Representatives passed a massive $1.75 trillion social safety net and climate bill proposed by the Biden administration. The bill will now head toward the Senate. Moreover, the White House has put pressure on Congress to quickly pass legislation providing $52 billion to help computer chip manufacturers and ease a shortage of the components vital for a range of industries.Strong Projections for Holiday SalesThe National Retail Federation has projected November/December retail sales in 2021 to go up 8.5% to 10.5% from 2020. Deloitte forecasts retail sales growth of 7% to 9% during the November-to-January period.Digital Commerce 360 has estimated that holiday retail sales through all channels, including physical stores, will likely rise 9.4% during the season. KPMG expects 2021 U.S. holiday sales to be 7% higher than last year. Mastercard SpendingPulse forecasts a 7.4% year-over-year rise in U.S. holiday sales.Solid Growth of U.S. GDP and Corporate ProfitIn its latest projection on Nov 17, the Atlanta Fed reported that the U.S. economy will grow by 8.2% in fourth-quarter 2021. U.S. GDP grew 6.4%, 6.7% and 2%, in the first, second and third quarters of this year, respectively.As of Nov 17, total third-quarter earnings of the market's benchmark — the S&P 500 Index — are projected to jump 40.3% from the same period last year on 17.2% higher revenues. Moreover, in fourth-quarter 2021, total earnings of the S&P 500 index are expected to up 19.4% year over year on 11.1% higher revenues.Our Top PicksWe have narrowed the search to five U.S. corporate behemoths (market capital > $100 billion) that have skyrocketed more than 50% year to date. These stocks still have more upside left for the rest of 2021 and have seen positive earnings estimate revisions within the last 30 days. Each of our picks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.The chart below shows the price performance of our five picks year to date.Image Source: Zacks Investment ResearchAlphabet Inc. has been strongly emphasizing AI techniques and the home automation space that should aid business growth in the long term. Solid momentum across search, advertising, cloud and YouTube businesses aided the results of GOOGL. Further, the growing proliferation of consumer online activities and rising advertiser spending remained as tailwinds.Alphabet's robust cloud division continues to be the key catalyst. Expanding data centers will continue to bolster its presence in the cloud space. Further, major updates in its search segment are enhancing the search results. Moreover, GOOGL’s mobile search is constantly gaining traction.Alphabet has an expected earnings growth rate of 84% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 5.9% over the last 30 days. The stock price of GOOGL has soared 66.4% year to date.Tesla Inc. has acquired a substantial market share within the electric car segment. Increasing Model 3 delivery, which forms a significant chunk of TSLA’s overall deliveries, is aiding its top line. Along with Model 3, Model Y is contributing to its revenues.In addition to increasing automotive revenues, Tesla’s energy generation and storage revenues boost its earnings prospects. The automaker said that its overall deliveries surged 20% in the third quarter from its previous record in the second quarter, marking the sixth consecutive quarter-on-quarter gain.Tesla has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings improved 9.7% over the last 30 days. The stock price of TSLA has jumped 57.2% year to date.The Home Depot Inc. is witnessing significant benefits from the execution of the “One Home Depot” investment plan, which focuses on expanding supply chain facilities, technology investments and enhancement to the digital experience.Amid the pandemic, customers have been increasingly blending the physical and digital elements of the shopping experience, making the interconnected One Home Depot strategy most relevant. The Home Depot is effectively adapting to the demand for renovations and construction activities, driven by prudent investments. HD is gaining from growth in Pro and DIY customer categories as well as digital momentum.The Home Depot has an expected earnings growth rate of 28.2% for the current year (ending January 2022). The Zacks Consensus Estimate for current-year earnings has improved 5.3% over the last 7 days. The stock price of HD has surged 53.8% year to date.Exxon Mobil Corp. made multiple world-class oil discoveries at the Stabroek Block, located off the coast of Guyana. XOM has raised the estimate for discovered recoverable resources from the Stabroek Block to approximately 10 billion oil-equivalent barrels.Exxon Mobile’s bellwether status and an optimal integrated capital structure, which has historically produced industry-leading returns make it a relatively lower-risk energy sector play. The integrated oil behemoth expects to reduce greenhouse gas emissions by 30% in its upstream business. By the same time, XOM expects to reduce flaring and methane emissions by 40%.Exxon Mobil has an expected earnings growth rate of more than 100% for the current year. The Zacks Consensus Estimate for current-year earnings improved 0.2% over the last 7 days. The stock price of XOM has advanced 53.2% year to date.Lowe's Companies Inc. remains well-positioned to capitalize on the demand in the home improvement market backed by investments in technology, merchandise category and strength in Pro business. Management is committed toward expanding LOW’s market share and boosting the operating margin.Lowe's Companies new total home strategy, which includes providing complete solutions for various types of home repair and improvement, bodes well. The strategy is an extension of LOW’s retail-fundamentals approach.Lowe's Companies has an expected earnings growth rate of 33.8% for the current year (ending January 2022). The Zacks Consensus Estimate for current-year earnings has improved 4.2% over the last 7 days. The stock price of LOW has climbed 57% year to date. Zacks’ Top Picks to Cash in on Artificial Intelligence This world-changing technology is projected to generate $100s of billions by 2025. From self-driving cars to consumer data analysis, people are relying on machines more than we ever have before. Now is the time to capitalize on the 4th Industrial Revolution. Zacks’ urgent special report reveals 6 AI picks investors need to know about today.See 6 Artificial Intelligence Stocks With Extreme Upside Potential>>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 Exxon Mobil Corporation (XOM): Free Stock Analysis Report Lowe's Companies, Inc. (LOW): Free Stock Analysis Report The Home Depot, Inc. (HD): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Alphabet Inc. (GOOGL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 24th, 2021

Futures Slide As Dollar Jumps, Yields Rebound Ahead Of Massive Data Dump

Futures Slide As Dollar Jumps, Yields Rebound Ahead Of Massive Data Dump For the third day in a row, US equity futures have been weighed down by rising (real) rates even as traders moderated their expectations for monetary-policy tightening after New Zealand’s measured approach to rate hikes where the central banks hiked rates but not as much as some had expected. Traders also braced for an epic data dump in the US, which includes is an epic data dump which includes an update to Q3 GDP, advance trade balance, initial jobless claims, wholesale and retail inventories, durable goods, personal income and spending, UMich consumer sentiment, new home sales, and the FOMC Minutes The two-year U.S. yield shed two basis points. The dollar extended its rising streak against a basket of peers to a fourth day. At 730am, S&P 500 e-mini futures dropped 0.3%, just off session lows, while Nasdaq futures dropping 0.34%. In premarket trading, Nordstrom sank 27% after the Seattle-based retailer posted third-quarter results featuring what Citi called a big earnings per share miss. The company reported higher labor and fulfillment costs in the third quarter while sales remained stubbornly below pre-pandemic levels and profit missed analyst estimates. Telecom Italia SpA surged in Europe on enhanced takeover interest. Oil prices fluctuated as producers and major consuming nations headed for a confrontation. Other notable premarket movers: Gap (GPS US) sank 20% premarket after the clothing retailer reported quarterly results that missed estimates and cut its net sales forecast for the full year. Analysts lowered their price targets. Nordstrom (JWN US) tumbles 27% in premarket after the Seattle-based retailer posted third-quarter results featuring what Citi called a big earnings per share miss. Jefferies, meanwhile, downgrades the stock to hold from buy as transformation costs are rising. Guess (GES US) posted quarterly results which analysts say included impressive sales and margins, and showed the company navigating supply-chain issues successfully. The shares closed 9.2% higher in U.S. postmarket trading. HP (HPQ US) shares are up 8.4% in premarket after quarterly results. Analysts note strong demand and pricing in the personal computer market. Meme stocks were mixed in premarket after tumbling the most since June on Tuesday as investors bailed out of riskier assets. Anaplan (PLAN US) slides 18% in premarket as a narrower-than-expected quarterly loss wasn’t enough to stem a downward trend. Analysts slashed price targets. Autodesk (ADSK US) shares slump 14% in premarket after the building software maker narrowed its full-year outlook. Analysts are concerned that issues with supply chains and the pandemic could impact its targets for 2023. GoHealth (GOCO US) gained 8.4% in postmarket trading after the insurer’s CEO and chief strategy officer added to their holdings. As Bloomberg notes, investors are on the edge as they face a wall of worry from a resurgence of Covid-19 in Europe to signs of persistent consumer-price growth. Damping inflation is now center-stage for policy makers, with ultra-loose, pandemic-era stimulus set to be wound down. The slew of U.S. data as well as Federal Reserve minutes due today may provide the next catalysts for market moves. In Europe, the Stoxx 600 Index erased earlier gains of up to 0.4% to trade down -0.1%, with tech and travel and leisure leading declines. Miners gained 0.8%, tracking higher copper prices on easing concerns over Chinese demand, while travel stocks slid over 1% on prospects of harsher travel curbs: Italy and France are debating new measures to cope with Covid’s resurgence while Germany isn’t ruling out fresh curbs. Oil stocks rose 1.2%, set for their biggest jump in over a month, with crude prices inching higher as investors remained sceptical about the effectiveness of a U.S.-led release of oil from strategic reserves. Here are some of the most notable European equity movers: Mulberry shares surge as much as 24%, the most since March 12, after the U.K. luxury company swung to a 1H profit from a year earlier and reported an increase in sales. Telecom Italia shares rise as much as 10% following a Bloomberg report that KKR is considering to raise its offer for the company after top investor Vivendi said the bid was too low. However, the stock is still trading below the initial non-binding offer from KKR. Golden Ocean gains as much as 9.6%, most since Feb., after earnings. DNB says “Golden Ocean delivered solid Q3 results” and adds “Furthermore, guidance for Q4 should lift consensus estimates and solidify further dividend potential in our view.” Intertek shares gain as much as 6.7%, the most since May 2020, after the company issued a trading update. UBS says the company’s accelerating momentum and reiterated targets are “reassuring.” Aegon shares rise as much as 5.5% after Credit Suisse upgraded its recommendation to outperform from neutral and raised the PT to EU5.30 from EU4.00. IQE shares slump as much as 21% for the biggest intraday drop since March 2020, falling to their lowest level since June 2020 after the semiconductor company said it sees softening demand in 4Q. Genus shares fall as much 15% after the animal genetics firm lowered its FY22 earnings guidance, leading Peel Hunt and Liberum to cut estimates. European stocks are on course for weekly losses, as the return of COVID-19 curbs, rate hike and inflation concerns sparked fears of a weaker economic growth outlook. "There's a two-way pull between macro concerns and what's happening bottoms-up in terms of corporate profits," said Nick Nelson, head of European equity strategy at UBS, adding that while the third quarter has been one of the decade's best reporting seasons for Europe, macro concerns such as a rise in U.S. bond yields and COVID-19 cases have been holding stocks back. Earlier in the session, Asian equities declined, on track for a third-straight session of losses, as higher U.S. Treasury yields continued to weigh on technology stocks in the region. The MSCI Asia Pacific Index slid as much as 0.6%, with Japan stocks leading losses as traders returned from a holiday to access the prospect of tighter U.S. monetary policy to curb inflation. TSMC and Tencent were among the biggest drags on the regional gauge. READ: Samsung Plans $17 Billion Texas Chip Plant, Creating 2,000 Jobs The renomination of Jerome Powell as Federal Reserve chair earlier this week has sent U.S. 10-year Treasury yields to about levels near 1.65%, implying higher borrowing costs. That’s adding to concerns about weak earnings growth in Asia as well as ongoing supply-chain constraints. Investors will now turn their attention to U.S. gross domestic product data and FOMC minutes due out after Asian markets close Wednesday.  “A cautious tone may still seem to prevail for now,” Jun Rong Yeap, a market strategist at IG Asia, said in a note. “Markets continue to shift their expectations towards a tighter Fed monetary policy.” New Zealand’s stock gauge added 0.6% after the central bank raised interest rates by 25 basis points, less than the 50 points that some economists had predicted. Singapore authorities, meanwhile, expect gross domestic product to expand 3% to 5% next year, a slower pace than this year as the country rebounds from the pandemic. Indian stocks fell ahead of the November monthly expiry on Thursday, led by technology companies. The S&P BSE Sensex slipped 0.6% to 58,340.99 in Mumbai to close at its lowest level in two months. The gauge gained 0.3% on Tuesday, snapping four sessions of selloff.   The NSE Nifty 50 Index declined 0.5% on Wednesday, reversing intraday gains of as much as 0.6%. Software exporter Infosys Ltd. was the biggest drag on both gauges and slipped more than 2%. Of the 30 shares in the Sensex, 21 dropped and nine rose.  Investors roll over positions ahead of the expiry of derivatives contracts on the last Thursday of every month. Fourteen of 19 sub-indexes compiled by BSE Ltd. fell, led by a measure of IT companies. “The scheduled monthly expiry would keep the traders busy on Thursday,” Ajit Mishra, vice president research at Religare Broking Ltd. wrote in a note. “We suggest continuing with negative bias on the index while keeping a check on leveraged positions.” In Fx, the most notable movers was the drop in the kiwi: New Zealand’s currency ironically slid to the weakest in nearly two months and the nation’s bond rallied as the central bank’s 25 basis-point rate hike disappointed traders betting on a bigger increase. The central bank projected 2% benchmark borrowing costs by the end of 2022. The Bloomberg Dollar Spot Index advanced a fourth consecutive day as the greenback gained versus all Group-of-10 peers apart from the yen, which reversed its losses after falling to the lowest since March 2017. The euro underperformed, nearing the $1.12 handle amid broad dollar strength even before data showing German business confidence took another hit in November and amid renewed fears that Germany may be considering a full lockdown and mandatory vaccines. RBNZ Governor Adrian Orr said policy makers considered a 50bps move before deciding on 25bps, and he sees the OCR climbing to around 2.5% by end-2023.  Elsewhere, Turkey’s lira stabilized after Tuesday’s plunge. MSCI’s gauge of emerging-market stocks edged lower for a sixth session.   In rates, Treasuries were richer by 1bp to 2bp across the curve, paced by European bonds ahead of a raft of U.S. data preceding Thursday’s market close. 10-year Treasury yields were richer by ~1bp on the day at around 1.655%, slightly trailing bunds; most curve spreads are within a basis point of Tuesday’s close with comparable shifts across tenors. During Asia session, Treasuries were supported by wider gains across Kiwi bonds after RBNZ hiked policy rates, but still erred on the dovish side. Bunds remain supported during European morning as haven demand stems from prospect of a nationwide German lockdown. Italian bonds snapped a two-day decline. In commodities, oil futures in New York swung between gains and losses following an announcement by the U.S. and other nations of a coordinated release of strategic reserves. Focus now turns to OPEC+ on how the group will respond to the moves. The alliance has already said that such releases were unjustified by market conditions and it may reconsider plans to add more supply at a meeting next week. Base metals are well bid with LME nickel adding over 2% to outperform peers. LME copper rises over 1% to best levels for the week. Crude futures fade a modest push higher fading after a brief push through Tuesday’s best levels. WTI trades flat, having briefly printed above $79; Brent prints highs of $83 before fading. Spot gold holds a narrow range close to $1,790/oz To the day ahead now, and there’s a significant amount of US data ahead of tomorrow’s Thanksgiving holiday. That includes the weekly initial jobless claims, the second estimate of Q3 GDP, October’s personal income and personal spending, new home sales, and the preliminary October readings for durable goods orders and core capital goods orders. Over in Germany, there’s also the Ifo’s business climate indicator for November. Finally on the central bank side, there’s the release of the FOMC’s November meeting minutes, and speakers include the ECB’s Panetta and Schnabel, and the BoE’s Tenreyro. Market Snapshot S&P 500 futures down 0.1% to 4,683.50 STOXX Europe 600 up 0.3% to 480.66 MXAP down 0.5% to 196.76 MXAPJ down 0.1% to 643.18 Nikkei down 1.6% to 29,302.66 Topix down 1.2% to 2,019.12 Hang Seng Index up 0.1% to 24,685.50 Shanghai Composite up 0.1% to 3,592.70 Sensex down 0.3% to 58,499.84 Australia S&P/ASX 200 down 0.2% to 7,399.44 Kospi down 0.1% to 2,994.29 Brent Futures up 0.4% to $82.63/bbl Gold spot up 0.1% to $1,791.37 U.S. Dollar Index little changed at 96.57 German 10Y yield little changed at -0.22% Euro down 0.2% to $1.1231 Top Overnight News from Bloomberg Olaf Scholz is set to succeed Angela Merkel as German chancellor after forging an unprecedented alliance that aims to revamp Europe’s largest economy by tackling climate change and promoting digital technologies The European Commission is set to announce the recommendations for the entire EU as soon as Thursday, Politico’s Playbook newsletter reported, citing three unidentified officials and diplomats Italy’s government is debating tough new measures to stem an increase in coronavirus cases, which could include restrictions on unvaccinated people and be approved as soon as Wednesday The ECB’s pandemic purchasing program may enter a “waiting room” rather than be abolished completely once net purchases are set to end in March, Governing Council member Robert Holzmann said at briefing in Vienna The U.K.’s biggest business lobby group has urged Prime Minister Boris Johnson to back down in its dispute with the European Union over Northern Ireland and not follow through with threats to suspend parts of the Brexit divorce deal Polish central bank Governor Adam Glapinski said further weakening of the zloty wouldn’t be consistent with the country’s economic fundamentals, helping lift the embattled currency from 12-year lows The supply crunch that’s helped drive inflation to multi- decade highs shows some signs of easing in the U.S. -- but it’s still getting worse in Europe. That’s the takeaway from the latest readings on Bloomberg Economics’ new set of supply indicators The unraveling of the Turkish lira threatens to erode Recep Tayyip Erdogan’s grasp on the economy and is already emboldening his political opponents. Small protests erupted in Istanbul and Ankara overnight, calling for an end to economic mismanagement that’s unleashed rapid inflation and triggered the currency’s longest losing streak in two decades A more detailed breakdown of global news courtesy of newsquawk Asia-Pac equity indices were mixed following the choppy performance of their US counterparts where energy rallied despite the SPR announcement and tech lagged as yields continued to gain, with the latest RBNZ rate hike, as well as looming FOMC Minutes and US data releases adding to the tentative mood. ASX 200 (-0.2%) was rangebound with the index subdued by losses in tech and gold miners which suffered from the rising yield environment, but with downside cushioned by strength in the largest weighted financials sector and with outperformance in energy after oil prices rallied in the aftermath of the widely anticipated SPR announcement. The strength in oil was attributed to several reasons including a “sell the rumour/buy the news” play and expectations of a response from OPEC+, while an administration official kept the prospect of an oil export ban on the table which is seen as bullish as it would remove US supply from the global market. Nikkei 225 (-1.6%) was the laggard on return from holiday amid flows into the local currency and with reports also suggesting the BoJ is considering tweaking its pandemic relief program. Hang Seng (+0.1%) and Shanghai Comp. (+0.1%) swung between gains and losses with early indecision due to the broad tech weakness tech which was not helped by reports that Chinese cyberspace regulators and police summoned Alibaba (9988 HK) and Baidu’s (9888 HK) cloud unit for telecoms network fraud, although the losses for Chinese bourses were eventually reversed amid gains in the energy heavyweights and after a mild PBoC liquidity injection. Finally, 10yr JGBs opened lower on spillover selling from global peers but gradually pared some of the losses after rebounding from support at 151.50 and with the BoJ in the market for nearly JPY 1.5tln of JGBs with up to 10yr maturities. Top Asian News Shinsei Drops Poison Pill Against SBI in Japan Takeover Saga Morgan Stanley to Repay Hong Kong Staff $5,100 for Quarantine KKR, Equinix Among Suitors for $11 Billion Global Switch Japan to Issue $192 Billion in Debt for Stimulus: Nikkei European equities attempted to claw back some of the week’s losses (Euro Stoxx 50 -0.2%; Stoxx 600 -0.2%) at the open with Monday and Tuesday’s session dominated by ongoing COVID angst in the region. Lockdown measures were enough to see investors shrug off yesterday’s better-than-expected PMI metrics for the Eurozone with today’s slightly softer than hoped for German Ifo report having little sway on price action. Despite the upside seen at the open, optimism has faded throughout the session as speculation mounts over whether the announcement of the German coalition deal (set to be unveiled at 14:00GMT) could prompt further lockdown measures for the nation. Furthermore, reports note that the Italian government is debating potential restrictions on the unvaccinated; measures could be approved as soon as today. On a more positive footing French Finance Minister Le Maire says at the moment he does not see any need for further COVID-related restrictions in France. However, it remains to be seen how long this viewpoint can be sustained. Stateside, futures are a touch softer with losses across the majors of a relatively equal magnitude (ES -0.1%) in the final full session of the week ahead of the Thanksgiving Holiday. Given the shortened week, today sees a deluge of data from the US with releases including key personal income, spending and PCE data for October, a second look at Q3 GDP, final Michigan consumer sentiment data, as well as weekly jobless claims and energy inventory data. All of which is followed by the FOMC minutes from the November meeting. In a recent note, BNP Paribas stated it is of the view that equities will go on to provide the highest returns across asset classes in 2022 with the French bank targeting 5100 (currently 4690) for the S&P 500 by the end of next year. From a European perspective, BNP expects the Euro Stoxx 50 to close 2022 out at 4500 (currently 4300) with the market “too pessimistic” on margins; albeit the Bank concedes that the resurgence of COVID presents a risk to its view. Sectors in Europe are mostly constructive with Oil & Gas and Basic Resources underpinned by gains in the underlying commodities with the former continuing to garner support post-yesterday’s SPR announcement. The Travel & Leisure sector lags peers with the Travel element of the group hampered by reports that the European Commission is preparing new COVID travel recommendations for the whole of the EU. For Leisure names, Entain (-5.0%) and Flutter Entertainment (-3.0%) have been hit by news that over 160 UK MPs and peers are said to be demanding that online gambling limits are lowered. Finally, Telecom Italia (+9.7%) is the best performer in the Stoxx 600 after source reports suggesting that KKR is considering a higher bid for the Co. in an attempt to win over support from Vivendi.   Top European News Scholz Seals Coalition Deal to Become Next German Chancellor Italy Readies Curbs on the Unvaccinated as Covid Cases Rise Booking Agrees to Buy CVC’s Etraveli for About EU1.63b Orange CEO Convicted in $453 Million Arbitration Fraud Case In FX, the Dollar index has gained traction and continued its gains above 96.500+ status in early European hours before eclipsing resistance at 96.700 to a fresh YTD peak at 96.758, with US players also preparing to wind down for the long weekend. Before that, the Buck will be facing a plethora of Tier 1 US data, including Prelim GDP (Q3), weekly Jobless Claims, and monthly PCE in the run-up to the FOMC Minutes – which will be eyed for clues on what could warrant an adjustment of the pace of tapering (Full preview available in the Newsquawk Research Suite). On the downside, immediate support will likely be at yesterday’s 96.308 low before this week’s current 96.035 trough. In terms of early month-end FX flows (on account of the holiday-shortened week), Morgan Stanley’s model points towards USD weakness against most G10 peers. EUR, GBP - The single currency dipped a 16-month low just before the release of the German Ifo survey, which unsurprisingly voiced cautiousness against the backdrop of COVID and supply chain issues – with Ifo forecasting a growth stagnation this current quarter, whilst ING believe that today’s Ifo signals that “The risk of stagnation or even recession in the German economy at the turn of the year has clearly increased.” The currency came under further pressure in what coincided with reports that Germany is mulling a full COVID lockdown and mandatory vaccinations, although the piece failed to cite any sources nor officials and seemed to be more an extrapolation of recent remarks from the German Health Minister. EUR/USD fell through pivotal support at 1.1210 to a current low at 1.1206 ahead of 1.1200. Traders should also be cognizant of several chunky OpEx clips including EUR 1.3bln between 1.1195-1.1200. Ahead, the SPD, Greens and FDP set to unveil their coalition deal at 14:00GMT. ECB speak today include from the likes Schnabel after Panetta and Holzmann failed to spur action across EU assets. Elsewhere, the GBP/USD is flat intraday and saw little reaction to BoE Governor Bailey yesterday, suggesting he does not think the MPC will go back to a hard form of guidance and stated that it is not off the table that they give no guidance at all on rates. Bailey also stated that decisions are made meeting by meeting and that they have a very tight labour market. From a political standpoint, European Commission VP Sefcovic said EU-UK talks on Northern Ireland trade rules will probably drag into 2022. Cable remains within a 1.3353-89 range whilst EUR/GBP trades on either side of 0.8400. Looking ahead, BoE’s Tenreyro speaking at the Oxford Economics Society – with early-Nov commentary from the MPC member suggesting that monetary policy will have to bite if there are signs of second-round inflation effects, but policy cannot fix energy price spikes. NZD, AUD - The Kiwi stands as the G10 laggard following a dovish 25bps hike by the RBNZ, with the board citing optionality. Desks suggest that FX was clearly gearing for a hawkish surprise from the central bank, with markets pricing some 35% of a 50bps hike heading into the meeting given the inflation survey earlier this month. Money markets were also disappointed, with participants flagging that the 2yr swap fell over 15bps despite the RBNZ upping its 2023 OCR forecast to 2.3% (prev. 1.7%). NZD/USD fell further beneath the 0.7000 mark to a current 0.6957 low. AUD meanwhile sees its losses cushioned from another day of firm gains in iron ore, whilst cross-currency flows help the AUD/NZD test 1.0450 to the upside. Nonetheless, the cautious market mood keeps AUD/USD around the flat mark after the pair found support at 0.7200. JPY - The traditional haven outperforms as risk aversion creeps into the market. USD/JPY pivots the 115.00 market after hitting an overnight high of 115.23. Some desks suggest that offers are seen from 115.30 on Wednesday, with more around the 115.50 area, according to IFR citing Tokyo sources. In terms of notable OpEx, USD/JPY sees USD 1.7bln between 115.00-10. In commodities, WTI and Brent Jan futures consolidate following yesterday’s gains post-SPR announcement. The release disappointed the oil bears given the widely telegraphed nature of the announcement coupled with relatively small contributions from members. Desks have also highlighted that the reserves will need to be replenished at some time in the future, and thus, analysts have passed the effects from the SPR release as temporary; although, cautioning that if the desired impact is not achieved, then further action can be taken – with a temporary export ban still on the table. Meanwhile, on the demand side, futures dipped after CNBC reported that Germany could head into a full lockdown, but the piece did not make a mention of officials nor sources but seemed to be more an extrapolation of recent comments from the Germany Health Minister, with an announcement on this matter potentially to come today. Further, tomorrow could see revised travel guidance for the whole of the EU, according to Politico sources, although "The biggest overall change will be a move away from a country-based approach and to a person-based one, which takes into account a citizen’s individual COVID status." Despite this month’s European COVID developments, JPMorgan sees global oil demand growing by another 3.5mln BPD next year to reach 99.8mln BPD (280k BPD above 2019 level); 2023 demand is expected to average around 101.5mln BPD (1.9mln BPD above pre-COVID levels) and suggested that global oil demand is on track to exceed 2019 levels by March 2022 and strengthen further. As a reminder, next week also sees the OPEC+ meeting whereby the group is expected to continue with plans of monthly output increases of 400k BPD, with a risk of a more dovish decision and/or commentary. WTI Jan trades around USD 78.50/bbl (vs high 79.23/bbl) and Brent Jan around USD 82.25/bbl (vs high 83.00/bbl). Elsewhere, spot gold is interestingly unfazed by the rampant Dollar as prices remain caged within a cluster of DMAs (100 around 1,793, 200 around 1,791 and 50 around 1,788). Copper prices are again on the grind higher with LME around USD 9,800/t at the time of writing – with participants citing underlying demand, particularly from China. US Event Calendar 8:30am: 3Q GDP Annualized QoQ, est. 2.2%, prior 2.0% 8:30am: 3Q GDP Price Index, est. 5.7%, prior 5.7% 8:30am: 3Q PCE Core QoQ, est. 4.5%, prior 4.5% 8:30am: 3Q Personal Consumption, est. 1.6%, prior 1.6% 8:30am: Oct. Durable Goods Orders, est. 0.2%, prior -0.3% 8:30am: Oct. Cap Goods Orders Nondef Ex Air, est. 0.5%, prior 0.8%; - Less Transportation, est. 0.5%, prior 0.5% 8:30am: Oct. Cap Goods Ship Nondef Ex Air, est. 0.5%, prior 1.4% 8:30am: Oct. Retail Inventories MoM, est. 0.3%, prior -0.2%; Wholesale Inventories MoM, est. 1.0%, prior 1.4% 8:30am: Oct. Advance Goods Trade Balance, est. - $95b, prior -$96.3b 8:30am: Nov. Initial Jobless Claims, est. 260,000, prior 268,000; Continuing Claims, est. 2.03m, prior 2.08m 9:45am: Nov. Langer Consumer Comfort, prior 50.7 10am: Oct. Personal Income, est. 0.2%, prior -1.0%; 10am: Oct. Personal Spending, est. 1.0%, prior 0.6% 10am: Oct. Real Personal Spending, est. 0.6%, prior 0.3% 10am: Oct. New Home Sales, est. 800,000, prior 800,000 10am: Oct. New Home Sales MoM, est. 0%, prior 14.0% 10am: Oct. PCE Deflator MoM, est. 0.7%, prior 0.3% 10am: Oct. PCE Core Deflator MoM, est. 0.4%, prior 0.2% 10am: Oct. PCE Deflator YoY, est. 5.1%, prior 4.4% 10am: Oct. PCE Core Deflator YoY, est. 4.1%, prior 3.6% 10am: Nov. U. of Mich. Sentiment, est. 67.0, prior 66.8 10am: Nov. U. of Mich. 5-10 Yr Inflation, prior 2.9% 10am: Nov. U. of Mich. 1 Yr Inflation, prior 4.9% 10am: Nov. U. of Mich. Current Conditions, prior 73.2 10am: Nov. U. of Mich. Expectations, prior 62.8 2pm: Nov. FOMC Meeting Minutes DB's Jim Reid concludes the overnight wrap We’ve had a number of requests to bring back our Covid tables in the EMR. At the moment I’m resisting as they take a considerable amount of time. While we work out an efficient form of articulating the current wave on a daily basis, in today’s EMR we show graphs of the daily rolling 7-day cases and fatalities per million in the population for the G7. We’ve also included Austria, given how topical that is, and also The Netherlands, given mounting problems there. These act as a useful reference point for some of the more stressed countries. The cases chart should be in the text below and the fatalities one visible when you click “view report”. Germany is probably the main one to watch in the G7 at the moment and overnight reported 66,884 new cases (a record) compared with 45,362 the day before. A reminder that yesterday we published our 2022 credit strategy outlook. See here for the full report. Craig has also put out a more detailed HY 2022 strategy document here and Karthik a more detailed IG equivalent here. Basically we think spreads will widen as much as 30-40bps in IG and 120-160bps in HY due to a response to a more dramatic appreciation of the Fed being well behind the curve. This sort of move is consistent with typical mid-cycle ranges through history. We do expect this to mostly retrace in H2 as markets recover from the shock and growth remains decent and liquidity still high. We also published the results of our ESG issuer and investor survey where around 530 responded. Please see the results here. As we hit Thanksgiving Eve and a US data dump of a day given the holiday tomorrow, the big story over the last 2-3 business days has been real rates in the US. As recently as Friday, after the Austria lockdown news, 10yr real rates hit -1.2%. Yesterday they traded above -0.95% before closing at -0.97%, +4.0bps higher than the previous close. Our view in the 2022 credit strategy document is that credit is more tied to real rates than nominal rates and if the market attacks the Fed as we expect, then they should go up. However, note that I’ve also said I suspect they’ll stay negative for the rest of my career so while higher real yields are likely, I suspect that this is a trade rather than a structural long-term journey given likely long-term financial repression. Anyway, rising real yields, a fresh covid wave and belief over a less dovish Fed post the Powell reappointment saw a tough day for equities, especially in Europe, before the US managed to eke out a gain into the close. The S&P 500 (+0.17%) was up for the first time in 3 days, whilst Europe’s STOXX 600 (-1.28%) posted its worst daily performance in nearly 2 months. On a sector level, it was the same story in the US, where energy (+3.04%) shares benefitted from climbing oil prices and financials (+1.55%) gained on steeper and higher yields. Larger tech firms retreated on the higher discount rates, with the Nasdaq declining -0.50%. Meanwhile the VIX index of volatility was back above the 20-mark for the first time in over a month, coinciding with a broader tightening of financial conditions. However, we dipped back below 20 into the stronger close. Honing in on bonds now and there was a major selloff yesterday that hit a number of European countries in particular. By the close of trade, yields on 10yr bunds were up +8.1bps, which is their single-biggest daily increase in over a year, actually since the day we found out that the Pfizer/BioNTech vaccine had proven successful in trials and was set to be rolled out. The move came about entirely due to higher real rates, with Germany 10yr inflation breakevens actually down -2.0bps on the day. Similar moves were seen elsewhere on the continent, with yields on 10yr OATs (+8.6bps) and BTPs (+10.5bps) seeing sharp rises of their own, which occurred in part on the back of stronger than expected flash PMI data raising the prospect of a quicker drawdown in monetary stimulus, not least with inflation still running some way ahead of the ECB’s target. For US Treasuries, yields were a touch more subdued, and the yield curve twist steepened. 2yr yields declined -1.8bp whilst every other maturity increased, and all tenors out to 7 years are at post-pandemic highs. The 5yr nominal yield increased +2.2bps to 1.34%. The 10yr was up +4.1bps to 1.67% due, as we discussed above, to real yields. 10yr breakevens were flat (+0.2bp) at 2.63%. The 10 year is 7.5bps off of 2021 closing highs and in the 430 plus business days since the pandemic started there have only been 14 days with a higher close than last nights. Elsewhere yesterday, we had an important piece of news on the energy front, as the US announced that it would be releasing 50m barrels of oil from the Strategic Petroleum Reserve, with the move occurring alongside similar decisions in China, India, Japan, South Korea and the UK. 32m of those 50m will be an exchange, whereby oil is released over the next few months that is then returned over the coming years, while another 18m are coming from an acceleration of an oil sale that Congress had already authorised. Oil prices rose following the release however, with Brent crude (+3.27%) and WTI (+2.28%) both seeing decent advances, in part because the contribution from other nations was smaller than many had anticipated, but also because the potential release from the SPR had been widely reported in advance, thus sending prices lower from their peak around a month ago. Even with the news, there’s no sign that inflationary pressures will be going away just yet, since much of what happens next will depend on the reaction of the OPEC+ group. If they move to cancel plans to increase production, then that could put upward pressure on prices again and help counter the impact of the move from the various energy consumers. And as we’ve been discussing, inflationary pressures have been widening for some time now, stretching beyond specific categories like energy and used cars to an array of other areas. Overnight in Asia stocks are trading mostly in the red with the CSI (-0.03%), Hang Seng (-0.06%), Shanghai Composite (-0.10%), KOSPI (-0.48%) and the Nikkei (-1.35%) all lower. The Reserve Bank of New Zealand has raised interest rates for the second consecutive month and lifted the official cash rate 25bps to 0.75%. There was some who expected 50bps so bonds are rallying with 2yr and 10yrs -5.5bps and -7.5bps lower, respectively. The central bank were pretty hawkish in their comments though. US Treasuries are 2-4bps lower across the curve overnight as well. Staying on New Zealand, the country eased its travel restrictions by allowing fully vaccinated travellers (and other eligible travellers) from Australia without any isolation from Jan 17 and those from the rest of the world from February 14. Elsewhere, South Korea reported its highest ever daily new cases of 4,115 with 586 critical cases with the PM announcing the situation is "more serious than expected". Futures are indicating a slightly weaker start in the US and Europe with the S&P 500 (-0.24%) and DAX (-0.09%) lower. Over in Europe, there’s no sign of the pandemic letting up just yet, with French health minister Veran saying in parliament that “we are sadly well and truly in a fifth wave of the epidemic” as France announced 30,454 new cases yesterday. Austria has been the main country in the headlines recently as it moved into a nationwide lockdown, but the reality is that the trend lines have been moving higher across the continent, raising the prospect of fresh restrictions. In terms of yesterday’s developments, the Netherlands announced that social distancing would be reintroduced on a mandatory basis, and that people should stay 1.5m apart, and Poland saw the biggest daily increase in hospitalisations since April. Elsewhere, Slovakia’s PM said that he was considering following the steps adopted in Austria, and the outgoing Czech PM said that mandatory vaccines for the over-60s were being considered. In spite of the growing Covid wave across Europe, the flash PMIs released yesterday actually proved better than the consensus was expecting, and even saw something of an uptick from the October readings. The Euro Area composite PMI ended a run of 3 successive declines as it rose to 55.8 (vs. 53.0 expected), with both manufacturing (58.6) and services (56.6) rising relative to a month ago. And both the German (52.8) and the French (56.3) composite PMIs were also better than expected. On the other hand, the US had somewhat underwhelming readings, with the flash services PMI down to 57.0 (vs. 59.0 expected), as the composite PMI fell to 56.5. To the day ahead now, and there’s a significant amount of US data ahead of tomorrow’s Thanksgiving holiday. That includes the weekly initial jobless claims, the second estimate of Q3 GDP, October’s personal income and personal spending, new home sales, and the preliminary October readings for durable goods orders and core capital goods orders. Over in Germany, there’s also the Ifo’s business climate indicator for November. Finally on the central bank side, there’s the release of the FOMC’s November meeting minutes, and speakers include the ECB’s Panetta and Schnabel, and the BoE’s Tenreyro. Tyler Durden Wed, 11/24/2021 - 08:07.....»»

Category: blogSource: zerohedgeNov 24th, 2021

Will Pfizer ETFs Soar on Positive COVID-19 Vaccine Updates?

Here we highlight some ETFs with high exposure to Pfizer (PFE) that can gain from the encouraging updates in the coronavirus vaccine. Investors have multiple reasons to cheer the Pfizer Inc. PFE stock as several positive updates about the Pfizer and BioNTech SE BNTX COVID-19 vaccine have hit the market. To begin with, the FDA has broadened the emergency use authorization (EUA) approval of the COVID-19 vaccine booster shot to adults aged 18 and above. The U.S. Centers for Disease Control and Prevention’s Advisory Committee on Immunization Practices (ACIP) has also issued a recommendation suggesting a booster dose. In fact, all the 11 ACIP members unanimously recommended the booster dose.In another development, Pfizer has announced positive results from a longer-term analysis of their COVID-19 vaccine’s safety and efficacy levels in individuals aged 12 through 15 years. Per the new findings from the companies’ pivotal Phase 3 trial, a two-dose series of the Pfizer-BioNTech COVID-19 Vaccine (30-µg per dose) delivered 100% effectiveness against COVID-19, measured seven days through over four months after the second dose.Market participants willing to ride Pfizer’s gains from the latest nod on the booster shots can consider ETFs like iShares U.S. Pharmaceuticals ETF IHE, First Trust Morningstar Dividend Leaders Index Fund FDL, iShares Evolved U.S. Innovative Healthcare ETF IEIH and Invesco Dynamic Pharmaceuticals ETF PJP.It is important to note that the booster shot can be administered to all individuals aged 18 years and above and have completed the primary vaccination with any of the authorized or approved COVID-19 vaccines. One can opt for the booster shot at least six months post-completion of the second dose of the primary series.Presently, Pfizer and BioNTech’s Comirnaty stands to be the only COVID-19 vaccine to have received “full” FDA approval for immunization of adults. The approval was granted by the FDA in August 2021. According to the FDA, the approval was provided after evaluating enormous vaccine data covering about 40,000 trial participants and reflecting 91% efficiency in preventing COVID-19 (per a CNBC article).Pfizer and BioNTech’s vaccine is also authorized for emergency use in children aged six to 11 years as well as adolescents aged 12 years and above in the United States and Canada. It is also authorized for use in adolescents and adults in Europe.ETFs to Shine BrightThe full FDA approval has been increasing the confidence for imposing vaccine mandates. Also, the unvaccinated population is now more likely to opt for vaccinations. Now, the nod for booster shots can likely enhance the confidence toward jabs, resulting in more people opting for the vaccination. This update is going to accelerate demand for coronavirus vaccines and boost the company’s financials.Considering the important role played by the coronavirus vaccines in Pfizer’s recent earnings results, the latest developments can be a positive for the stock. Interestingly, Pfizer has earned revenues of $24.3 billion in the first nine months from the sale of Comirnaty. It is expected to witness total sales of roughly $36 billion at the end of 2021. The early receipt of regulatory authorization for paediatrics and adolescents in the United States has put Pfizer and BioNTech in an advantageous position to gain a lead in the COVID-19 vaccine space. Pfizer expects to generate total sales of approximately $29 billion by delivering 1.7 billion doses of Comirnaty in 2022.Thus, let’s take a look at ETFs with high exposure to Pfizer that can gain from the recent development:iShares U.S. Pharmaceuticals ETFiShares U.S. Pharmaceuticals ETF provides exposure to U.S. companies that manufacture prescription or over-the-counter drugs or vaccines.iShares U.S. Pharmaceuticals ETF 47 stocks in its basket, with Pfizer making up 21.7% share. The product has AUM of about $384.4 million. iShares U.S. Pharmaceuticals ETF charges 42 basis points (bps) in fees and expenses (read: Wave of Solid Q3 Earnings Push Pharma ETFs Higher).First Trust Morningstar Dividend Leaders Index Fund First Trust Morningstar Dividend Leaders Index Fund replicates as closely as possible, before fees and expenses, the price and yield of the Morningstar Dividend Leaders Index and holds 100 stocks in its basket.Pfizer holds 6.6% weight in the fund. The product has amassed $1.67 billion in its asset base. First Trust Morningstar Dividend Leaders Index Fund has an expense ratio of 0.45%.iShares Evolved U.S. Innovative Healthcare ETF iShares Evolved U.S. Innovative Healthcare ETF employs data science techniques to identify companies with exposure to the innovative healthcare sector and holds 248 stocks in its basket, with Pfizer making up for a 7.7% share.iShares Evolved U.S. Innovative Healthcare has AUM of about $41.9 million. The fund charges 18 bps in fees and expenses (read: JNJ Posts Mixed Q3 Bag, Ups View: ETFs in Focus).Invesco Dynamic Pharmaceuticals ETFInvesco Dynamic Pharmaceuticals ETF seeks investment results that correspond generally to the price and yield, before fees and expenses, of the Dynamic Pharmaceutical Intellidex Index and holds 23 stocks in its basket, with Pfizer making up for a 6.5% share.Invesco Dynamic Pharmaceuticals ETF has AUM of about $437.4 million. The fund charges 58 bps in fees and expenses. 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 report Pfizer Inc. (PFE): Free Stock Analysis Report Invesco Dynamic Pharmaceuticals ETF (PJP): ETF Research Reports iShares U.S. Pharmaceuticals ETF (IHE): ETF Research Reports First Trust Morningstar Dividend Leaders ETF (FDL): ETF Research Reports iShares Evolved U.S. Innovative Healthcare ETF (IEIH): ETF Research Reports BioNTech SE Sponsored ADR (BNTX): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 23rd, 2021

Why This Cheap Stock is a Strong Buy Right Now

Home audio standout Sonos (SONO) topped fourth quarter fiscal 2021 earnings estimates on November 17. The company also raised its guidance in the face of global supply chain worries... Home audio standout Sonos SONO topped fourth quarter fiscal 2021 earnings estimates on November 17. The company also raised its guidance in the face of global supply chain worries. And those are just a few of the reasons why investors might want to consider the lower-priced tech-focused retailer.Turning Up the VolumeSonos is a speaker company that competes against Bose and others such as Apple AAPL in the higher-end home audio market. The Santa Barbra, California-based company specializes in wireless and multi-room sound systems.Sonos sells a range of sleek, connected speakers, subwoofers, soundbars for TVs, and more. Its baseline speakers start at around $200 and packages can cost over $2,000. The company in April finally entered the popular portable smart speaker space with its new $179 mass-market Roam speaker. And it also sells what it calls architectural speakers that can be built into walls or ceilings.Sonos has benefited from the larger shift to modern, connected devices and it’s poised to gain as more people spend on home-based upgrades. The firm is also expanding its non-speaker business, with an ad-free streaming tier of its music service dubbed Sonos Radio HD. The subscription service costs $7.99 a month and competes against Spotify, Apple Music, and other streaming platforms.Image Source: Zacks Investment ResearchGrowing Even Louder?Sonos went public in 2018 and its revenue climbed 11% in fiscal 2019 and 5% last year. The company then posted blowout results in its FY21, which ended on October 2. Its full-year revenue soared 30% to $1.72 billion and its adjusted earnings skyrocketed from $0.67 to $1.77 a share. The company also easily topped our Q4 EPS estimate.Broad-based, home-focused spending helped support some of the growth. The firm also stands to benefit for years to come as people invest in modern, tech-infused offerings for their homes, offices, and beyond.Perhaps most importantly, Sonos has built up a loyal customer base, full of repeat buyers. Its total households climbed 15% last year to 12.6 million. “We consistently see our existing customers adding more products to their systems, and with every new household that we add, that flywheel begins…” CEO Patrick Spence said in prepared fourth quarter remarks.  “Total products per household increased to 3.0, underscoring the power of our model and we are poised to drive further increases in customer lifetime value as we continue to innovate and introduce new products and services.”Sonos executives raised their 2022 guidance in the face of global supply chain bottlenecks. Plus, the firm said its “powerful momentum” has it “ahead of schedule” for reaching the fiscal 2024 financial targets it first laid out last March. The company said it’s “confident in” its “ability to deliver an approximately 13% revenue CAGR, 45% to 47% gross margin, and 15% to 18% adjusted EBITDA margin through fiscal 2024.”Looking ahead, Zacks estimates call for Sonos revenue to climb 14% this year and another 12.3% in FY23 to reach $2.19 billion. Its adjusted earnings are projected to slip from its hard-to-compete-against FY21, before bouncing back in FY23. And its overall FY22 and FY23 consensus EPS estimates have climbed since its release.Bottom LineThe speaker firm's strong bottom-line revisions help it grab a Zacks Rank #1 (Strong Buy) right now. Plus, Sonos has now crushed our bottom-line estimates over the last year-plus. The stock also grabs “A” grades for Growth and Momentum in our Style Scores system, and five of the seven brokerage recommendations Zacks has are either “Strong Buys” or “Buys,” with nothing below a “Hold.” And Sonos executives announced a new stock buyback program recently.Despite the strong results, the stock is trading below where it was on November 17. SONO is also down around 17% in the last three months and it closed regular hours Monday about 27% below its April records at $32.21 a share. Plus, its current Zacks consensus price target of $47.80 a share marks roughly 50% upside to Monday’s levels.Sonos does sit below both its 50-day and 200-day moving averages and it has continued to struggle over the last several months after its huge covid rally sent it from under $10 in March 2020 to over $40 in April. On the valuation front, Sonos is trading right near its own year-long lows at 23.8X forward 12-month earnings. This marks a 50% discount to its own high during this stretch and it comes in not too far above its industry’s average. Zacks' Top Picks to Cash in on Artificial Intelligence In 2021, this world-changing technology is projected to generate $327.5 billion in revenue. Now Shark Tank star and billionaire investor Mark Cuban says AI will create "the world's first trillionaires." Zacks' urgent special report reveals 3 AI picks investors need to know about today.See 3 Artificial Intelligence Stocks With Extreme Upside Potential>>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 Apple Inc. (AAPL): Free Stock Analysis Report Sonos, Inc. (SONO): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 23rd, 2021

Fed "Taper" Is Good News For The Bond Market

Fed "Taper" Is Good News For The Bond Market Authored by Lance Roberts via RealInvestmentAdvice.com, Investors are fretting over the prospect of a “Fed Taper,” but history shows such will likely be good news for the bond market. Currently, it doesn’t seem that way, with rates rising post-announcement. As noted by CNBC: “While the Fed has gone into policy retreat before, it has never pulled back from such a dramatically accommodative position. For the past eighteen months, it bought at least $120 billion of bonds each month, Such provided unprecedented support to financial markets that it now will walk back. The bond purchases have added more than $4 trillion to the Fed’s balance sheet which now stands at $8.5 trillion. Roughly, $7 trillion of which is the assets bought up through the Fed’s quantitative easing programs. The purchases helped keep interest rates low. Such provided support to markets that malfunctioned badly during the pandemic, and fueled a powerful run for the stock market.” Previously, when the Fed began to taper their bond-buying programs, the market buckled as the “risk-on” trade reversed. As was the case previously, Wall Street analysts quickly assumed that this time would be different despite the previous debacles. “When Federal Reserve officials talked about pulling back on accommodative policies in 2013, anxious investors sent markets into a tizzy. The opposite is happening now: The Fed signaled it started discussions of reducing bond-purchase programs. Investors, however, remain placid. The markets, in short, are taking everything in stride.” – WSJ That is the case for now. Now let’s take a look at how the potential impact of the Fed’s announcement to taper may possibly be good news for the bond market. Global Liquidity Is Slowing While Wall Street is eternally optimistic, there are two problems with the view the Fed can cut liquidity without consequence. To begin with, it isn’t just the Fed cutting liquidity. Liquidity globally, from both Central Banks and Governments, has started reversing heading into 2022. *Global liquidity via central banks has already peaked and now in sharp decline ~ indicating world business conditions and growth to follow downwards The rate of change is what matters - thus w/ liquidity in steep decline = increasing downside in economy (w/ a lag) Deflationary pic.twitter.com/lbIeuvPGtC — Adem Tumerkan (@RadicalAdem) September 23, 2021 The hope, of course, is the economy is now strong enough to “stand on its own” without ongoing support. But, as discussed in “Reversion To The Mean,” economic growth is already falling well below expectations. “Over the next few quarters, the year-over-year comparisons will become much more challenging. Q2-2021 will likely mark the peak of the economic recovery.“ During each previous QE cycle, as soon as the liquidity flows slowed or stopped, undesired outcomes were close by. Awaken The Bond Bull The recent “pop” in rates, when the Fed announced they will taper bond purchases, was not surprising. Such is the expectation if one of the primary sources of bond-buying is getting removed. “In theory, tapering should lead to higher interest rates. By tapering its bond purchases, the Fed is increasing the supply that must get absorbed by the market. Such signals that policy is becoming less accommodative.” – Schwab However, over the last decade, a reversal in Fed policy has repeatedly provided bond-buying opportunities. In the past, rates rose during QE programs as money rotated out of the “safety of bonds” back into equities (risk-on.). When those programs ended, rates fell as investors reversed their risk preferences. As the Fed begins tapers, investors’ risk preferences will change as liquidity wanes. There are three reasons such will be the case. All interest rates are relative. With trillions in global debt globally sporting negative interest rates, the assumption that rates in the U.S. are about to spike higher is likely wrong. Higher yields in U.S. debt attracts flows of capital from countries with negative yields which push rates lower in the U.S. The coming budget deficit balloon. Given the lack of fiscal policy controls, and promises of continued largesse, the budget deficit will swell beyond $4 Trillion in coming years. Such will require more government bond issuance to fund future expenditures. Central Banks will continue to be a buyer of bonds to maintain market stability, but will become more aggressive buyers during each recession.” With the current Administration and the Treasury pushing the idea of more government spending, the budget deficit is already rising, with economic growth running well below expectations. Such will foster more, not less, demand for bonds in the future and this is potentially good news for the bond market.  Bonds May Outperform Here is the primary point. While market punditry continues to push a narrative that “stocks are the only game in town,” such will likely turn out to be poor advice. But that is the nature of a media-driven analysis with a lack of historical experience or perspective. From many perspectives, the absolute risk of the heavy equity exposure in portfolios gets outweighed by the potential for further reward. The realization of “risk,” when it occurs, will lead to a rapid unwinding of the markets pushing volatility higher and bond yields lower. Such is why we continue to acquire bonds on rallies in the markets to hedge against a future market dislocation. In other words, we get paid to hedge risk, lower portfolio volatility, and protect capital. Bonds aren’t dead.In fact, they are likely going to be your best investment in the not too distant future. In the short term, the market could surely rise further, especially if the Fed continues reinvesting the proceeds from their balance sheet. Such is a point I will not argue as investors are historically prone to chase returns until the very end. But over the intermediate to longer-term time frame, the consequences are entirely negative. As my mom used to say: “It’s all fun and games until someone gets their eye put out.” Tyler Durden Tue, 11/23/2021 - 06:30.....»»

Category: blogSource: zerohedgeNov 23rd, 2021

BofA Is Bearish On Markets Ahead Of The 2022 "Rates Shock"

BofA Is Bearish On Markets Ahead Of The 2022 "Rates Shock" For those who have been following BofA CIO Michael Hartnett's sometimes disjointed thoughts and observations, dutifully jotted down in his weekly Flow Show report (and summarized here), it will come as no surprise that the Bank of America strategist has been turning decisively bearish in recent months (see BofA Chief Strategist: Markets Are About To Be Hit With Three Shocks; This Is How One Bank Will Trade The Bursting Of The Biggest Ever Asset Bubble In 2022; and ""2022: The Year Of The Rate Shock": The Fed's Policy Mistake Already Happened And Next Year Everyone Pays"). Even so, it was certainly helpful for Hartnett's clients (and our readers) to be presented with a more structured and organized version of the CIO's views for the year ahead, which is what he did overnight in his latest periodical The Thundering Word, titled appropriately "Fin de Siecle" in which he finally makes it clear that "we are market bearish" for many of the same reasons we have discussed previously namely that the "growth show" of 2020, which was followed by the "inflation shock" of 2021 will be followed by the "rates shock" in '22 (as described here). The sharply higher rates, a taste of which we got today when real rates spiked following news that Powell will be renominated for another 4 years... ... will tighten financial conditions via Wall St and/or policy action; and since asset prices are driven by rates & profits, with short rates rising in 2022 (as QE ends, threatening to invert the yield curve) and as EPS sharply slow... ... Hartnett expects low/negative and  volatile asset returns in '22 after 18 months of fat returns in crypto, credit & US equities. Hartnett's bearish views aside, the strategist admits that BofA economists and strategists predict robust GDP growth with weak China the outlier; and while inflation is predicted to be above consensus like GDP it too should decelerate next 12 months; All this leads to the bank's house view of 3 Fed rate hikes forecast in '22 (unlike Morgan Stanley which stubbornly expects no rate hikes in 2022 and with more covid lockdowns on the way, may well be right) with 10-year Treasuries ending the year at 2%; BofA also expects the US dollar & oil to remain well-bid (oil peaks around $117/barrel in Q2), and gold will appreciate. So with that macro background in mind, here is Hartnett summarizing 2021, or "The Year Behind"... The Year Behind: ’21 started with an insurrection, ended with inflation, narratives flipped from political “blue waves”, China credit/regulatory crackdowns, institutionalization of cryptocurrencies, US infrastructure, supply-chain disruptions and so on, but 3 dominant investment themes were… The Vaccine: number of global vaccinations against COVID-19 surged from 10 million jabs to over 7 billion; this in turn led to a "reopening" of the US & European economies and a surge in corporate profits (e.g. US EPS flipped from -20% in '20 to 49% in '21); at the same time the world was unable to say "end of COVID" and summer delta fear and “growth shock” in Aug/Sept engorged the bull via prolonging… The Stimulus: policy makers added almost $9tn in policy stimulus this year ($4tn fiscal, $5tn QE) to the $23tn announced in '20 ($15tn fiscal, $8tn QE); central banks remained exceptionally dovish & behind-the-curve, led by the Fed (see real rates); the vaccine & the stimulus led to… The Inflation: excess stimulus/demand clashed with insufficient supply across a wide range of sectors and markets including transportation, energy, goods, services, housing and labor. 2021 in Returns: Inflation explains commodities (up 46% for best year since '73) & government bonds (down 8% for worst year since '49)... ... as well as outperformance of energy & banks (Table 2). Excess liquidity helps explain the ascent of cryptocurrencies (a transformative technology). Dovish central banks & V-shape in EPS explain splendid performance of stocks ($1.0tn of institutional flows to stocks in ’21), particularly US stocks which have outperformed the RoW by most since '97 (19.8pps); note 10-year rolling outperformance of US stocks vs government bonds widest since 1964 (12.2pps). China & monetary tightening meant miserable performance of Emerging Markets (LatAm stocks relative to US just hit lowest level since LTCM crisis of 1998). * * * Which brings us to 2022: The Year Ahead, and the bank's three scenarios Base case… 2021-22 investment backdrop similar to early stagflation of late-60s, early-70s…period of inflation & interest rates breaking higher from secular low/stable trading ranges on back of high budget deficits, Vietnam, “Great Society” policies, civil unrest, political & acquiescent Fed; late-60s/70s “stagflation” winners were real assets, real estate, commodities, volatility, cash, EM, all of which held their own vs inflation; losers were bonds, credit, equities, tech, all of which ultimately struggled (see Stagflation Quilt chart below); we think we’re in the ’69-’71 period. Hartnett is convinced 2020 was the secular low point on inflation and interest rates; last 2 great inflection points for bond markets were 1966, 1980...2020 watershed driven by social/economic shifts from Wall St to Main St, Deregulation to Intervention, Globalization to Isolationism, Wealth to Health, Capital to Labor…COVID simply the accelerator. The CIO also believes that the 2020s will see secular bull markets in volatility & commodities beginning, while the bull market in stocks & credit ending (as shown in secular return charts 5-10); He also expects the US dollar to peak in 2022; note the "permanent portfolio" of 25/25/25/25 of cash, commodities, stocks, bonds appreciated 15.4% annualized in 2021 highlighting an era where greater diversification rewarded also beginning. For 2022, Hartnett sees consensus bullishly positioned for another year of “stocks go up, bonds go nowhere, and Fed does nothing.” And indeed, BofA's Bull & Bear Indicator does not suggest an immediate “short” opportunity but as in 2018 that can change quickly. Here Hartnett is quick to note that asset price sensitivity to central bank liquidity has been extremely high in past decade, and a global tapering has begun (G5 liquidity add was $8.5tn in 2020, $2.1tn in 2021, will be just $0.1 in 2022); meanwhile BofA's global EPS growth model peaked at 40% in June, it is currently running around 30% and predicts further EPS deceleration to 10%, CPI>5%, house prices >20%, largest worker shortages in 50 years…this most unconventional of cycles highly unlikely to follow a conventional path…the-mother-of-all bubbles in crypto & tech remains a “fat tail”. More prosaically stock market upside could continue if it becomes clear in H1 that Fed determined to keep real rates deeply negative (expect a market narrative that the Fed can’t “bankrupt” US Treasury), and US monetary policy dictated by a credo of Wall St "too big to fail" (this goes without saying but a "big fall in credit & stocks prices quickest route to recession, civil unrest, institutional crisis and so on"). Bear case… By far the biggest downside risk is Fed stays hawkish even if Wall Street corrects because fears of wage-price spiral grow; in addition a return of bond vigilantes across developed world (they returned in EM in 2021) causes bond & currency volatility. Even more extreme downside risks include a crypto-derivatives crash, geopolitical events related to China & Taiwan, and that a receding liquidity wave exposes credit-events to the detriment of private & public equity. Not even the bearish Hartnett expects these to materialize (just yet). Finally, this is how BofA will trade based on these views: Macro trades: long US$, MOVE, VIX (tighter financial conditions); long quality, defensives e.g. staples, telco, big pharma (EPS deceleration); long oil, energy (inflation); long real asset (best inflation hedge), short copper/semis (IP lower); short PE/XBD (wider credit spreads). Contrarian trades: long GT30 & gold (yield curve inversion/recession); long EM (spring peak in US dollar); long CRE/CMBS (global reopening); long China credit; long small cap value (hedge for US tech bubble); long income streams in commodity markets (dollar debasement); short Nasdaq (rates & regulation). Tyler Durden Mon, 11/22/2021 - 19:20.....»»

Category: blogSource: zerohedgeNov 22nd, 2021

Allstate (ALL) Announces Quarterly Dividend: Worth a Look?

Despite Allstate's (ALL) moves to boost shareholder values, high debt burden and declining profits are concerning. The Allstate Corporation ALL recently announced a quarterly dividend of 81 cents. The amount is in line with the previous quarter but up 50% from the year-ago period. It has hiked dividends annually for the past few years. The dividend will be paid out on Jan 3 next year to shareholders on record as of Nov 30.The dividend amount translates to $3.24 per share on an annualized basis. Considering Nov 19’s closing price of $111.94 per share, Allstate’s dividend yield currently stands at 2.9%. Not only is the yield attractive for income investors but it also represents a steady income stream. Further, the yield is impressive compared with the industry average of 0.4%. Additionally, the company has an impressive share repurchase plan in place. This August, ALL approved a new $5-billion share repurchase authorization to be completed by Mar 31, 2023. This authorization leads to the continuation of Allstate's strong track record of providing cash returns to shareholders.Despite its moves to boost shareholder value, prudent investors are cautiously watching the stock from the sidelines. There can be multiple reasons why many investors are cautious on Allstate.Let’s delve deeper.Debt Burden: At third quarter-end, Allstate had only $690 million in cash and long-term debt of $7,980 million. Its high debt level remains a concern, which results in increased interest expenses. The metric rose 3.4% during the first nine months of 2021 from the prior-year comparable period. Hence, the company must service its debt uninterruptedly, or else creditworthiness could be dented.Profits Decline: Even though the company is witnessing a significant rise in revenues, profits are falling, primarily due to increased claim expenses. As COVID-19 restrictions are being eased off, more and more travelers are hitting the roads, leading to a higher number of incidents. This is resulting in higher claims and severity of claims.Supply Chain Disruption: The pandemic has affected the supply chain, which in turn, has reduced the availability of car parts. This has boosted the cost of repairs and reduced the profits of car insurers like Allstate. ALL now has to rely on increasing premiums to boost profitability, which is not likely to make customers happy.Exposure to Catastrophe Losses: Due to Allstate’s relatively large property insurance business, it is significantly exposed to catastrophic events. In the first nine months of 2021, the company incurred $2.8 billion of catastrophe losses, which increased 17.8% from the prior-year comparable period.Price PerformanceThe stock has declined 18.4% in the past six months compared with the 2.9% fall of the industry.Image Source: Zacks Investment ResearchZacks Rank & Stocks to ConsiderThe company currently has a Zacks Rank #5 (Strong Sell). Some better-ranked players in the finance space include Alerus Financial Corporation ALRS, Blackstone Inc. BX and Houlihan Lokey, Inc. HLI, each carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Alerus Financial’s bottom line for 2021 is expected to jump 11.5% year over year to $2.81 per share. It has witnessed three upward estimates in the past 30 days and no movement in the opposite direction. Alerus Financial beat earnings estimates thrice in the past four quarters and missed once, with an average surprise of 23.6%.Based in Grand Forks, ND, Alerus Financial provides numerous financial services to clients. Its financial strength is reflected by massive total assets of $3.2 billion at third quarter-end, which increased 5.4% for the first nine months of 2021. Rising investment securities will likely keep boosting the company’s asset position in the coming quarters.Blackstone’s 2021 earnings are expected to rise 64.2% to $4.35 per share. It has witnessed five upward estimate revisions in the past 30 days compared with none in the opposite direction. The company beat earnings estimates in all the last four quarters, with an average of 23.7%.Headquartered in New York, Blackstone is well poised to benefit from its fund-raising ability, revenue mix and inorganic expansion strategies. The company’s fee-earning assets under management (AUM) and total AUM consistently demonstrate strong growth, aided by increasing net inflows. Over the last four years (2017-2020), fee-earning AUM witnessed a CAGR of 11.9% and total AUM saw a CAGR of 12.5%.Houlihan Lokey — headquartered in Los Angeles, CA — provides multiple financial services to clients all over the world. Its growing footprint in Europe and Asia’s investment banking services field will help the company boost strategic and shareholder value in the coming days. Rising average transaction fees will increase corporate finance revenues.Full-year fiscal 2022 bottom line of Houlihan Lokey is expected to rise 36.8% year over year to $6.32 per share. In the past 30 days, it has witnessed four upward estimate revisions and no downward movement. The company beat earnings estimates in all the last four quarters, with an average of 39.5%. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>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 Blackstone Inc. (BX): Free Stock Analysis Report The Allstate Corporation (ALL): Free Stock Analysis Report Houlihan Lokey, Inc. (HLI): Free Stock Analysis Report Alerus Financial (ALRS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 22nd, 2021

Most Popular Hedge Fund Stocks Suffer Record Stretch Of Underperformance: Here"s Why

Most Popular Hedge Fund Stocks Suffer Record Stretch Of Underperformance: Here's Why Three months ago, we reported that according to Goldman calculations, the first half of 2021 was the worst 6 months since the financial crisis, with the bank noting that "one factor weighing on hedge fund returns has been the extraordinarily weak performance of the most popular hedge fund long positions" coupled with continued strong gains by the most popular shorts, which served as a double whammy to hedge fund alpha. Among the various reasons cited for the poor performance of long books was the collapse in Chinese stocks, very popular among hedge funds at the start of the year, which had been clobbered in 2021 as a result of Xi Jinping's new "shared prosperity" drive and escalating crackdowns against whole sectors of the market which sent some of the most popular Chinese names into a tailspin. Fast forward to this weekend, when Goldman's Ben Snider writes in the bank's latest Hedge Fund Trend Monitor report (which analyzes 799 hedge funds with $2.9 trillion of gross equity positions ($2 trillion long and $918 billion short) based on 13F filings as of Nov 15), that the pain extended for one more quarter, and as of Sept 30, "the most popular hedge fund long positions have suffered a record stretch of underperformance this year." This comes at a time when according to HFR, the typical US equity hedge fund has returned just 13% YTD (Goldman Sachs Prime Services data show an average return of 11% YTD through October), roughly half the return of the broader S&P500, with nearly 10 percentage points of that return generated in the first four months of the year. Specifically, since February, Goldman's Hedge Fund VIP list of the most popular hedge fund long positions (GSTHHVIP) "has lagged the S&P 500 by 16 percentage points (+6% vs. +22%), exceeding the period in 2015-2016 as the basket’s worst on record." As shown in the chart below, the Hedge Fund VIP list (GSTHHVIP) of the most popular hedge fund long positions has lagged the S&P 500 by 16 percentage points since February (+6% vs. +22%), exceeding the period in late 2015 and early 2016 as the worst stretch for the basket relative to the market in its history of nearly 20 years. As discussed here in recent weeks, while hedge fund leverage remains elevated relative to history, it is below recent highs, suggesting funds were not fully prepared for the market rally at the start of 4Q. Aggregate hedge fund net leverage calculated based on publicly-available data registered 55% at the start of 4Q, above the historical average but below the 58% exposure at the start of 2021. Higher-frequency exposures calculated by Goldman Sachs Prime Services show hedge fund net leverage that peaked in June and now ranks close to the average level of the past 12 months, though still in the 80th percentile of the past three years. Consistent with elevated hedge fund net leverage, and perhaps following the catastrophic - for shorts - Q1, short interest for the typical stock remains close to the lowest level on record. Short interest for the median S&P 500 stock declined from 2.2% of cap at the start of 2020 to 1.5% at the start of 2021 and has remained roughly stable since. This matches the degree of short interest during the Tech Bubble in 2000 as the lowest in at least 25 years. Short interest in every sector ranks below the 25-year average. In retrospect, it's a good thing hedge funds trimmed their short exposure: it's no secret that while popular shorts generally underperformed the market during 3Q, they have rallied sharply in recent weeks, weighing again on hedge fund returns. In fact, according to Snider, a monthly-rebalanced basket of the most concentrated short positions (GSCBMSAL) lagged the Russell 3000 by over 20 percentage points between the end of June 2021 and the end of October (-16% vs. +5%). However, during the first week of November, the shorts jumped by 16%, outperforming by 13 pp. As we have frequently discussed over the past month, this surge was coincident with a rise in retail trading activity. Drilling down into the pain, on a sector basis, concentrated shorts have created the most pain in the Consumer Discretionary and Materials sectors YTD. Portfolios of the most concentrated shorts in those sectors have dramatically outperformed both the most popular hedge fund positions and the aggregate sectors this year. In other words, for yet another quarter, going long the most popular shorts - something we first said in 2013 is the only winning strategy in this broken, manipulated market - has been the best trade! Adding insult to injury, in addition to the latest squeeze, at a factor level funds entered 4Q with their smallest Growth tilt since early 2015, but Growth has outperformed so far this quarter. Funds are typically tilted to Growth but began to rotate toward Value in mid-2020 as the economy and equity market began to rebound. Funds temporarily shifted back to Growth in 2Q 2021 but resumed their rotation to Value during 3Q. Since the start of 4Q, Goldman's sector-neutral, long/short Growth factor (GSMEFGRO) has returned 4% and the Russell 1000 Growth index has outperformed the Value index by 7%. Here it's worth noting that while hedge funds took down their overall market exposure in Q3, retail investors did the opposite, and as Snider notes, one reason short interest has declined so dramatically is the still-elevated degree of retail trading activity in the equity market. After surging in late 2020 and early 2021, retail trading activity appeared to stabilize this summer but has risen again in the last several weeks, particularly in call options. Since early last year, changes in retail trading activity have been reflected in the performance of the most popular retail stocks as well as in the stocks with the most concentrated short interest. During the last few weeks, as retail trading activity increased, a basket of the most concentrated short positions (GSCBMSAL) rallied by 16% vs. 4% for the Russell 3000. The chart below shows the top 30 Russell 3000 stocks based on the estimated retail share of trading volume during the past month. As before, the stocks in this list generally carry higher short interest than the typical Russell 3000 stock. Of these 30 stocks, only AMD and NVDA are constituents of the Hedge Fund VIP list. We will have more to say on the retail most popular/most shorted stocks in a subsequent post. Still, before you cry for hedge funds, it's worth noting that they are now suffering the consequences of their own greedy actions. As Goldman notes in its HF tracker, "surprisingly, while hedge funds rotated long portfolios toward Value during 3Q, they also lifted the weight of high-multiple growth stocks to a new record." In other words, they took the barbell trade to absolute extremes, betting on deep value and extremely overvalued, high growth names. While stocks with EV/sales ratios over 10x account for 23% of Russell 3000 market cap, they account for a third of US equity hedge fund long portfolios in aggregate, up from 31% at the start of 2021 and 16% at the start of 2020. That said, funds slightly trimmed their exposure to stocks with EV/sales multiples over 20x. While it's obvious by now, Snider explains that "extremely low interest rates [i.e., thank you, Fed] and investor focus on future growth have created a large premium for stocks with very fast revenue growth without regard for the profitability of those companies. The average Russell 3000 stock with consensus 2023 revenue growth greater than 20% and a profit margin over 20% trades at 11x FY2 EV/sales, roughly the same multiple as a stock with 20%+ growth but low or no profitability." Goldman cautions that while many of these high growth, low profit companies have attractive outlooks, the dependence of their current valuations on long-term future cash flows makes them particularly vulnerable to the risks of rising interest rates or disappointing revenues. The outperformance of highly profitable growth stocks this year, particularly during 1Q when real interest rates jumped, underscores their attractiveness relative to growth stocks with low profitability. As mentioned above, a key reason for hedge fund underperformance in Q3 was the continued aversion to all things Chinese. While prices of US-listed China stocks generally stabilized in recent months, during 3Q hedge funds cut their exposures to the stocks to the lowest level since late 2018. China ADR share prices declined by more than 50% between mid-February and late August. The drop weighed on the returns of hedge funds, which entered 3Q 2021 with the largest exposure to China ADRs on record. The share of US hedge funds in Goldman's sample with a long position in at least one China ADR registered 33% entering 3Q but dropped to 25% by the start of 4Q as prices fell and funds cut exposure. Turning attention to portfolio construction next, Goldman finds that hedge fund portfolio concentration rose modestly in 3Q 2021 but still remains far below pre-COVID levels. The typical hedge fund holds 64% of its long portfolio in its top 10 positions, slightly above the historical average but well below the 70% share at the end of 1Q 2020 - this underscores the importance of VIPs for overall hedge fund returns. Unlike the slight increase in concentration within hedge fund portfolios, crowding across hedge fund portfolios remained flat in the quarter; that said, Goldman's crowding Index remains near the record highs of early 2016 and 2020. Amid the relentless market confusion of 2021 in general and Q3 in particular, portfolio paralysis has set in and as the net chart shows, portfolio position turnover continued its recent trend and declined in 3Q 2021. The average fund turned over 23% of distinct equity positions in 3Q, the lowest in at least 20 years. Turnover decreased in 10 of the 11 sectors with Consumer Staples the only exception. Looking at sector exposure, as before, Info Tech represents the largest sector net exposure (24%) but a large underweight (-317 bp) relative to the Russell 3000. Health Care Tech represents 19% of funds’ net exposure and is the largest overweight (+553 bp). Hedge fund and mutual fund sector tilts are generally in the same direction, with Financials representing a notable exception: Mutual funds carry a large overweight in the sector, but hedge funds have a net underweight tilt relative to the Russell 3000. Consumer Discretionary is the other point of disagreement between hedge funds (overweight) and mutual funds (underweight). While IT remains unloved, funds increased net tilts to Industrials by 128 bp, the largest change in any sector. The current 368 bp hedge fund overweight in Industrials is the largest tilt at any point since at least 2007. Unfortunately, the sector has underperformed the S&P 500 by 11 pp since May, but Goldman economists expect economic growth to reaccelerate from 2.0% in 3Q 2021 to 4.5% in 4Q 2021 and 1Q 2022, which should benefit the most cyclical pockets of the sector (we'll see about that after another round of covid lockdowns in the US). Within Industrials, hedge funds added the most to Trucking and Electrical Components & Equipment. Six Industrials stocks currently screen into Goldman's Hedge Fund VIP list: BLDR, INFO, KSU, TDG, UBER, WSC. Finally, at the subsector level, hedge funds increased tilts to both secular growth and cyclical equities in 3Q. Funds added to tilts in Trucking, Autos, and Software while cutting exposure to Diversified Banks, Internet Retail, and Biotech. The current fund tilts in Energy and Communication Services rank as nearly the smallest positions in the past decade. While the Energy tilt is very small relative to history, during 3Q funds moved from underweight to overweight the sector relative to the Russell 3000. While professional subscribers have access to the full report in the usual spot, in a subsequent post we will drill down into the 30 most popular as well as 30 most hated/shorted names for those who wish to put on the most successful trade of the past decade - going long the most hated names and shorting the most popular basket. Tyler Durden Mon, 11/22/2021 - 07:24.....»»

Category: blogSource: zerohedgeNov 22nd, 2021

Bull of the Day: LendingClub Corporation (LC)

LendingClub Corporation (LC) stock has soared over the last year and it could be set to keep on growing as part of a booming fintech space... LendingClub Corporation LC went public in 2014 as a purely digital peer-to-peer lending firm. LC struggled for years for various reasons. The firm then found new life amid the global fintech boom and LendingClub changed its long-term trajectory when it purchased Radius Bancorp in the early part of 2021.LC’s Fintech Story LendingClub is a diversified, web-based lending company that allows customers to take out loans for almost any purpose, from auto loans and other larger purchases such as home improvements to paying down credit card debt. The firm normally allows people to borrow up to $40,000, typically with a fixed term and fixed interest rate, on a regular monthly payment schedule.The company boosted its long-term outlook when it bought digital-only bank Radius Bancorp. The acquisition, which closed in February 2021, enabled LendingClub to keep more of the loans it generates on its own balance sheet.For example, it retained $636 million of loans, or about 20% of originations during Q3. This was “in line” with its 15% to 25% target. The practice allows the firm to collect recurring interest income instead of simply selling off all of the loans it generates. The deal also provides a more direct pathway to becoming a modern, digital-based bank, with a consumer focus.The company utilizes its AI-driven “credit decisioning” and machine-learning models to help determine what customers it will provide loans. LendingClub boasts that its models help it offer lower credit rates, while also reducing its own delinquency rates—35% lower delinquency rates compared to the competitive set. Since its founding in 2007, nearly 4 million members have taken on various loans through the company.LendingClub’s growth potential is rather large in a world driven by credit and digital financial services, both large-scale and on the consumer level. Its digital focus will help it grow and the firm is already seeing “half of its members come back for a second loan.” CEO Scott Sanborn said on its earnings call that it benefits since the “loans originate at a fraction of the cost compared to loans to new members and demonstrate lower credit risk.”The revamped LendingClub is currently expanding its portfolio with newer products. These include products like auto loan refinancing and its entry into the red-hot “buy now, pay later” space. More broadly, the revamped LendingClub aims to offer a “broad range of products, helping our customers manage their lending, spending and savings.”Image Source: Zacks Investment ResearchRecent Performance and Outlook LendingClub topped our Q3 estimates at the end of October, with revenue up 246% YoY and 20% sequentially, which is a better comparison given the timing of its Radius Bancorp deal. Meanwhile, new recurring stream of net interest income grew 42% sequentially and marketplace revenue grew 15% sequentially.The company’s deposits grew 12% sequentially to $2.8 billion. And it crushed our adjusted earnings estimate for the third period running.Looking ahead, Zacks estimates call for LendingClub’s fiscal 2021 revenue to soar 156% to $804.1 million, with FY22 set to climb another 41% higher to $1.13 billion. And it’s expected to swing from an adjusted loss of -$1.53 a share to +$0.11 this year and then skyrocket all the way to +$1.52 in 2022.The nearby chart shows how far LC’s consensus earnings estimate have climbed since its report, with FY21 up from -$0.12 to its current levels and 33% higher for FY22. This bottom-line positivity helps LendingClub earn a Zacks Rank #1 (Strong Buy) right now.  Image Source: Zacks Investment ResearchOther Fundamentals LendingClub shares have certainty skyrocketed in the last 12 months, up well over 500% from under $7 a share to Thursday’s $41 per share levels. Luckily, LC shares have cooled off a bit as Wall Street took profits after its huge post-Q3 release surge from around $32 a share to nearly $50 in only a few sessions.The stock is now trading around 15% below its recent highs and it’s fallen from above overbought RSI levels (70 or higher) back down near neutral at 52. LendingClub is also trading at a 33% discount to where it was three months ago at 30.1X forward 12-month earnings. This backdrop could provide the stock with room to climb, especially considering some analysts have raised their price targets to well over $50 a share recently. Bottom LineLendingClub is part of a larger group of fintech companies expanding their scope in an effort to become something akin to modern digital native banks poised to thrive in the digital-everything world.LC is currently focused on the consumer side, while others such as Square SQ are trying to do both. But Square stock trades at around $230 a share. This makes Square a bit less attainable for some investors and SQ trades at sky-high forward 12-month earnings multiples.LendingClub lands an “A” grade for Growth in our Style Scores system and its industry sits in the top 30% of over 250 Zacks industries. Plus, three of the five brokerage recommendations Zacks has are “Strong Buys,” with nothing beneath a “Hold.”  More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report LendingClub Corporation (LC): Free Stock Analysis Report Square, Inc. (SQ): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Why Fast-paced Mover The Children"s Place (PLCE) Is a Great Choice for Value Investors

If you are looking for stocks that have gained strong momentum recently but are still trading at reasonable prices, The Children's Place (PLCE) could be a great choice. It is one of the several stocks that passed through our 'Fast-Paced Momentum at a Bargain' screen. Momentum investing is essentially an exception to the idea of "buying low and selling high." Investors following this style of investing are usually not interested in betting on cheap stocks and waiting long for them to recover. Instead, they believe that "buying high and selling higher" is the way to make far more money in lesser time.Everyone likes betting on fast-moving trending stocks, but it isn't easy to determine the right entry point. These stocks often lose momentum when their future growth potential fails to justify their swelled-up valuation. In that phase, investors find themselves invested in shares that have limited to no upside or even a downside. So, betting on a stock just by looking at the traditional momentum parameters could be risky at times.It could be safer to invest in bargain stocks that have been witnessing price momentum recently. While the Zacks Momentum Style Score (part of the Zacks Style Scores system), which pays close attention to trends in a stock's price or earnings, is pretty useful in identifying great momentum stocks, our 'Fast-Paced Momentum at a Bargain' screen comes handy in spotting fast-moving stocks that are still attractively priced.The Children's Place (PLCE) is one of the several great candidates that made it through the screen. While there are numerous reasons why this stock is a great choice, here are the most vital ones:A dash of recent price momentum reflects growing interest of investors in a stock. With a four-week price change of 35%, the stock of this children's clothing and accessories chain is certainly well-positioned in this regard.While any stock can see a spike in price for a short period, it takes a real momentum player to deliver positive returns for a longer time frame. PLCE meets this criterion too, as the stock gained 24.6% over the past 12 weeks.Moreover, the momentum for PLCE is fast paced, as the stock currently has a beta of 2.24. This indicates that the stock moves 124% higher than the market in either direction.Given this price performance, it is no surprise that PLCE has a Momentum Score of B, which indicates that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.In addition to a favorable Momentum Score, an upward trend in earnings estimate revisions has helped PLCE earn a Zacks Rank #2 (Buy). Our research shows that the momentum-effect is quite strong among Zacks Rank #1 and #2 stocks. That's because as covering analysts raise their earnings estimates for a stock, more and more investors take an interest in it, helping its price race to keep up. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Most importantly, despite possessing fast-paced momentum features, PLCE is trading at a reasonable valuation. In terms of Price-to-Sales ratio, which is considered as one of the best valuation metrics, the stock looks quite cheap now. PLCE is currently trading at 0.87 times its sales. In other words, investors need to pay only 87 cents for each dollar of sales.So, PLCE appears to have plenty of room to run, and that too at a fast pace.In addition to PLCE, there are several other stocks that currently pass through our 'Fast-Paced Momentum at a Bargain' screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Children's Place, Inc. (PLCE): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksNov 19th, 2021

AdvanSix (ASIX) Shows Fast-paced Momentum But Is Still a Bargain Stock

If you are looking for stocks that have gained strong momentum recently but are still trading at reasonable prices, AdvanSix (ASIX) could be a great choice. It is one of the several stocks that passed through our 'Fast-Paced Momentum at a Bargain' screen. Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher."Everyone likes betting on fast-moving trending stocks, but it isn't easy to determine the right entry point. These stocks often lose momentum when their future growth potential fails to justify their swelled-up valuation. In that phase, investors find themselves invested in shares that have limited to no upside or even a downside. So, betting on a stock just by looking at the traditional momentum parameters could be risky at times.A safer approach could be investing in bargain stocks with recent price momentum. While the Zacks Momentum Style Score (part of the Zacks Style Scores system) helps identify great momentum stocks by paying close attention to trends in a stock's price or earnings, our 'Fast-Paced Momentum at a Bargain' screen comes handy in spotting fast-moving stocks that are still attractively priced.There are several stocks that currently pass through the screen and AdvanSix (ASIX) is one of them. Here are the key reasons why this stock is a great candidate.Investors' growing interest in a stock is reflected in its recent price increase. A price change of 10.3% over the past four weeks positions the stock of this polymer resins producer well in this regard.While any stock can see a spike in price for a short period, it takes a real momentum player to deliver positive returns for a longer time frame. ASIX meets this criterion too, as the stock gained 41.4% over the past 12 weeks.Moreover, the momentum for ASIX is fast paced, as the stock currently has a beta of 1.77. This indicates that the stock moves 77% higher than the market in either direction.Given this price performance, it is no surprise that ASIX has a Momentum Score of A, which indicates that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.In addition to a favorable Momentum Score, an upward trend in earnings estimate revisions has helped ASIX earn a Zacks Rank #1 (Strong Buy). Our research shows that the momentum-effect is quite strong among Zacks Rank #1 and #2 stocks. That's because as covering analysts raise their earnings estimates for a stock, more and more investors take an interest in it, helping its price race to keep up. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Most importantly, despite possessing fast-paced momentum features, ASIX is trading at a reasonable valuation. In terms of Price-to-Sales ratio, which is considered as one of the best valuation metrics, the stock looks quite cheap now. ASIX is currently trading at 0.86 times its sales. In other words, investors need to pay only 86 cents for each dollar of sales.So, ASIX appears to have plenty of room to run, and that too at a fast pace.In addition to ASIX, there are several other stocks that currently pass through our 'Fast-Paced Momentum at a Bargain' screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AdvanSix (ASIX): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Recent Price Trend in Kura Sushi (KRUS) is Your Friend, Here"s Why

Kura Sushi (KRUS) could be a great choice for investors looking to make a profit from fundamentally strong stocks that are currently on the move. It is one of the several stocks that made it through our "Recent Price Strength" screen. Most of us have heard the dictum "the trend is your friend." And this is undeniably the key to success when it comes to short-term investing or trading. But it isn't easy to ensure the sustainability of a trend and profit from it.The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the stock alive.Investors looking to make a profit from stocks that are currently on the move may find our "Recent Price Strength" screen pretty useful. This predefined screen comes handy in spotting stocks that are on an uptrend backed by strength in their fundamentals, and trading in the upper portion of their 52-week high-low range, which is usually an indicator of bullishness.Kura Sushi (KRUS) is one of the several suitable candidates that passed through the screen. Here are the key reasons why it could be a profitable bet for "trend" investors.A solid price increase over a period of 12 weeks reflects investors' continued willingness to pay more for the potential upside in a stock. KRUS is quite a good fit in this regard, gaining 45.8% over this period.However, it's not enough to look at the price change for around three months, as it doesn't reflect any trend reversal that might have happened in a shorter time frame. It's important for a potential winner to maintain the price trend. A price increase of 60.6% over the past four weeks ensures that the trend is still in place for the stock of this company.Moreover, KRUS is currently trading at 85% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout.Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), which means it is in the top 20% of more than the 4,000 stocks that we rank based on trends in earnings estimate revisions and EPS surprises -- the key factors that impact a stock's near-term price movements.The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Another factor that confirms the company's fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is highly optimistic about the stock's near-term price performance.So, the price trend in KRUS may not reverse anytime soon.In addition to KRUS, there are several other stocks that currently pass through our "Recent Price Strength" screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Kura Sushi USA, Inc. (KRUS): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksNov 19th, 2021

Community Health Systems (CYH) Shows Fast-paced Momentum But Is Still a Bargain Stock

If you are looking for stocks that have gained strong momentum recently but are still trading at reasonable prices, Community Health Systems (CYH) could be a great choice. It is one of the several stocks that passed through our 'Fast-Paced Momentum at a Bargain' screen. Momentum investing is essentially the opposite of the tried-and-tested Wall Street adage -- "buy low and sell high." Investors following this investing style typically avoid betting on cheap stocks and waiting long for them to recover. They believe instead that one could make far more money in lesser time by "buying high and selling higher."Everyone likes betting on fast-moving trending stocks, but it isn't easy to determine the right entry point. These stocks often lose momentum when their future growth potential fails to justify their swelled-up valuation. In that phase, investors find themselves invested in shares that have limited to no upside or even a downside. So, betting on a stock just by looking at the traditional momentum parameters could be risky at times.A safer approach could be investing in bargain stocks with recent price momentum. While the Zacks Momentum Style Score (part of the Zacks Style Scores system) helps identify great momentum stocks by paying close attention to trends in a stock's price or earnings, our 'Fast-Paced Momentum at a Bargain' screen comes handy in spotting fast-moving stocks that are still attractively priced.There are several stocks that currently pass through the screen and Community Health Systems (CYH) is one of them. Here are the key reasons why this stock is a great candidate.Investors' growing interest in a stock is reflected in its recent price increase. A price change of 25% over the past four weeks positions the stock of this operator of accute care hospitals well in this regard.While any stock can see a spike in price for a short period, it takes a real momentum player to deliver positive returns for a longer time frame. CYH meets this criterion too, as the stock gained 16.5% over the past 12 weeks.Moreover, the momentum for CYH is fast paced, as the stock currently has a beta of 1.71. This indicates that the stock moves 71% higher than the market in either direction.Given this price performance, it is no surprise that CYH has a Momentum Score of B, which indicates that this is the right time to enter the stock to take advantage of the momentum with the highest probability of success.In addition to a favorable Momentum Score, an upward trend in earnings estimate revisions has helped CYH earn a Zacks Rank #2 (Buy). Our research shows that the momentum-effect is quite strong among Zacks Rank #1 and #2 stocks. That's because as covering analysts raise their earnings estimates for a stock, more and more investors take an interest in it, helping its price race to keep up. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Most importantly, despite possessing fast-paced momentum features, CYH is trading at a reasonable valuation. In terms of Price-to-Sales ratio, which is considered as one of the best valuation metrics, the stock looks quite cheap now. CYH is currently trading at 0.15 times its sales. In other words, investors need to pay only 15 cents for each dollar of sales.So, CYH appears to have plenty of room to run, and that too at a fast pace.In addition to CYH, there are several other stocks that currently pass through our 'Fast-Paced Momentum at a Bargain' screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Community Health Systems, Inc. (CYH): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksNov 19th, 2021

Here"s What Could Help Samsonite International S.A. Unsponsored ADR (SMSEY) Maintain Its Recent Price Strength

Samsonite International S.A. Unsponsored ADR (SMSEY) could be a great choice for investors looking to make a profit from fundamentally strong stocks that are currently on the move. It is one of the several stocks that made it through our "Recent Price Strength" screen. While "the trend is your friend" when it comes to short-term investing or trading, timing entries into the trend is a key determinant of success. And increasing the odds of success by making sure the sustainability of a trend isn't easy.The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the stock alive.Our "Recent Price Strength" screen, which is created on a unique short-term trading strategy, could be pretty useful in this regard. This predefined screen makes it really easy to shortlist the stocks that have enough fundamental strength to maintain their recent uptrend. Also, the screen passes only the stocks that are trading in the upper portion of their 52-week high-low range, which is usually an indicator of bullishness.There are several stocks that passed through the screen and Samsonite International S.A. Unsponsored ADR (SMSEY) is one of them. Here are the key reasons why this stock is a solid choice for "trend" investing.A solid price increase over a period of 12 weeks reflects investors' continued willingness to pay more for the potential upside in a stock. SMSEY is quite a good fit in this regard, gaining 13.3% over this period.However, it's not enough to look at the price change for around three months, as it doesn't reflect any trend reversal that might have happened in a shorter time frame. It's important for a potential winner to maintain the price trend. A price increase of 3.2% over the past four weeks ensures that the trend is still in place for the stock of this company.Moreover, SMSEY is currently trading at 90% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout.Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), which means it is in the top 20% of more than the 4,000 stocks that we rank based on trends in earnings estimate revisions and EPS surprises -- the key factors that impact a stock's near-term price movements.The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Another factor that confirms the company's fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is highly optimistic about the stock's near-term price performance.So, the price trend in SMSEY may not reverse anytime soon.In addition to SMSEY, there are several other stocks that currently pass through our "Recent Price Strength" screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Samsonite International S.A. Unsponsored ADR (SMSEY): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021

Here"s What Could Help Olympus Corp. (OCPNY) Maintain Its Recent Price Strength

Olympus Corp. (OCPNY) could be a great choice for investors looking to make a profit from fundamentally strong stocks that are currently on the move. It is one of the several stocks that made it through our "Recent Price Strength" screen. While "the trend is your friend" when it comes to short-term investing or trading, timing entries into the trend is a key determinant of success. And increasing the odds of success by making sure the sustainability of a trend isn't easy.The trend often reverses before exiting the trade, leading to a short-term capital loss for investors. So, for a profitable trade, one should confirm factors such as sound fundamentals, positive earnings estimate revisions, etc. that could keep the momentum in the stock alive.Our "Recent Price Strength" screen, which is created on a unique short-term trading strategy, could be pretty useful in this regard. This predefined screen makes it really easy to shortlist the stocks that have enough fundamental strength to maintain their recent uptrend. Also, the screen passes only the stocks that are trading in the upper portion of their 52-week high-low range, which is usually an indicator of bullishness.There are several stocks that passed through the screen and Olympus Corp. (OCPNY) is one of them. Here are the key reasons why this stock is a solid choice for "trend" investing.A solid price increase over a period of 12 weeks reflects investors' continued willingness to pay more for the potential upside in a stock. OCPNY is quite a good fit in this regard, gaining 10.7% over this period.However, it's not enough to look at the price change for around three months, as it doesn't reflect any trend reversal that might have happened in a shorter time frame. It's important for a potential winner to maintain the price trend. A price increase of 6.5% over the past four weeks ensures that the trend is still in place for the stock of this company.Moreover, OCPNY is currently trading at 80.7% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout.Looking at the fundamentals, the stock currently carries a Zacks Rank #2 (Buy), which means it is in the top 20% of more than the 4,000 stocks that we rank based on trends in earnings estimate revisions and EPS surprises -- the key factors that impact a stock's near-term price movements.The Zacks Rank stock-rating system, which uses four factors related to earnings estimates to classify stocks into five groups, ranging from Zacks Rank #1 (Strong Buy) to Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record, with Zacks Rank #1 stocks generating an average annual return of +25% since 1988. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>Another factor that confirms the company's fundamental strength is its Average Broker Recommendation of #1 (Strong Buy). This indicates that the brokerage community is highly optimistic about the stock's near-term price performance.So, the price trend in OCPNY may not reverse anytime soon.In addition to OCPNY, there are several other stocks that currently pass through our "Recent Price Strength" screen. You may consider investing in them and start looking for the newest stocks that fit these criteria.This is not the only screen that could help you find your next winning stock pick. Based on your personal investing style, you may choose from over 45 Zacks Premium Screens that are strategically created to beat the market.However, keep in mind that the key to a successful stock-picking strategy is to ensure that it produced profitable results in the past. You could easily do that with the help of the Zacks Research Wizard. In addition to allowing you to backtest the effectiveness of your strategy, the program comes loaded with some of our most successful stock-picking strategies.Click here to sign up for a free trial to the Research Wizard today. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Olympus Corp. (OCPNY): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksNov 19th, 2021