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Category: topSource: washpostOct 13th, 2021

A Look At Tesla’s Relatively Tiny Numerical Sequential Sales Growth

Stanphyl Capital’s commentary for the month ended September 30, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). Q2 2021 hedge fund letters, conferences and more We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which currently has a diluted market cap of $868 billion, roughly equal to the $870 […] Stanphyl Capital’s commentary for the month ended September 30, 2021, discussing their short position in Tesla Inc (NASDAQ:TSLA). if (typeof jQuery == 'undefined') { document.write(''); } .first{clear:both;margin-left:0}.one-third{width:31.034482758621%;float:left;margin-left:3.448275862069%}.two-thirds{width:65.51724137931%;float:left}form.ebook-styles .af-element input{border:0;border-radius:0;padding:8px}form.ebook-styles .af-element{width:220px;float:left}form.ebook-styles .af-element.buttonContainer{width:115px;float:left;margin-left: 6px;}form.ebook-styles .af-element.buttonContainer input.submit{width:115px;padding:10px 6px 8px;text-transform:uppercase;border-radius:0;border:0;font-size:15px}form.ebook-styles .af-body.af-standards input.submit{width:115px}form.ebook-styles .af-element.privacyPolicy{width:100%;font-size:12px;margin:10px auto 0}form.ebook-styles .af-element.privacyPolicy p{font-size:11px;margin-bottom:0}form.ebook-styles .af-body input.text{height:40px;padding:2px 10px !important} form.ebook-styles .error, form.ebook-styles #error { color:#d00; } form.ebook-styles .formfields h1, form.ebook-styles .formfields #mg-logo, form.ebook-styles .formfields #mg-footer { display: none; } form.ebook-styles .formfields { font-size: 12px; } form.ebook-styles .formfields p { margin: 4px 0; } Get Our Activist Investing Case Study! Get the entire 10-part series on our in-depth study on activist investing in PDF. Save it to your desktop, read it on your tablet, or print it out to read anywhere! Sign up below! (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q2 2021 hedge fund letters, conferences and more We remain short the biggest bubble in modern stock market history, Tesla Inc. (TSLA), which currently has a diluted market cap of $868 billion, roughly equal to the $870 billion (non-diluted) combined market caps of Toyota ($253 billion), VW ($141 billion), Daimler ($96 billion), GM ($76 billion), BMW ($65 billion), Stellantis ($60 billion), Ford ($57 billion), Honda ($53 billion), Hyundai ($49 billion) and Nissan ($20 billion), despite annualized sales for Tesla of around 800,000 cars a year to their over 50 million. The core points of our Tesla short thesis are: Tesla has no “moat” of any kind; i.e., nothing meaningfully proprietary in terms of electric car technology, while existing automakers—unlike Tesla­—have a decades-long “experience moat” of knowing how to mass-produce, distribute and service high-quality cars consistently and profitably, as well as the ability to subsidize losses on electric cars with profits from their conventional cars. Excluding sunsetting emission credit sales Tesla is barely profitable. Growth in sequential unit demand for Tesla’s cars has slowed to a crawl. Elon Musk is a pathological liar who under the terms of his SEC settlement cannot deny having committed securities fraud. Tesla's Expected Q3 Sales Growth Latest estimates are that Tesla is expected to report around 29,000 more deliveries for Q3 vs. Q2 (approximately 230,000 vs. Q1’s 201,000), a rounding error for an auto company trading at even one-tenth of Tesla’s valuation. If in any quarter GM or VW or Toyota sold 2.55 million vehicles instead of 2.58 million or 2.525 million, no one would pay the slightest bit of attention to the difference. Well guess what? Seeing as Tesla is being valued at more than eleven GMs, it’s time to start looking at its relatively tiny numerical sequential sales growth, rather than Wall Street’s sell-side hype of “percentage off a small base.” In other words, if you want to be valued at a giant multiple of “the big boys,” it’s time you were treated as a big boy! Meanwhile in July, thanks to an suspiciously high gross margin and very “non-growthy” reduced R&D expense, Tesla reported an improved Q2 2021, claiming to have earned $788 million excluding $354 million of pure-profit emission credit sales (excluded because they’ll almost entirely disappear some time next year when other automakers will have enough EVs of their own). However, that earnings number also includes what I estimate to be around $300 million in unsustainably low warranty provisioning, and after adjusting for that plus the credit sales, I believe Tesla earned a sustainable .43/share, which annualizes to $1.72. An auto industry PE multiple of 10x would thus make TSLA worth around $17/share (admittedly, more than the “$0” I previously expected). A “growth multiple” of 20x would value it at $34, which is more than a 95% discount to September’s closing price of $775. And before you tell me that a 100% premium to the industry’s PE ratio isn’t enough, keep in mind that—as noted earlier—Tesla’s sequential unit growth is an auto industry rounding error. In fact, one could argue that Tesla’s multiple should carry a discount, considering the massive legal and financial liabilities continually generated by its pathologically lying CEO. Meanwhile, on the Q2 earnings call Musk admitted that the so-called “Full Self Driving” he’s been selling for five years (and that Consumer Reports calls outright dangerous) doesn’t work, and he said it again in August following an “AI Day” in which he tried to cover up the Tesla’s autonomy cluelessness with an inert plastic statue of a robot and a man dancing in a unitard. (You had to see it to believe it and then you still wouldn’t believe it!)  In a saner regulatory environment Tesla’s selling of “Full Self Driving” for five years now would be considered “consumer fraud,” and indeed in August two U.S. Senators finally demanded an FTC investigation while the NHTSA opened yet another safety investigation. (For all known Tesla deaths see TeslaDeaths.com.) Will there be major write-downs and refunds given, killing the company’s slight “profitability”? Stay tuned! And remember, the 2021 overview from Guidehouse Insights rates Tesla dead last among autonomous competitors: The Chinese Government's Love Affair With Tesla Is Over Another favorite hype story from Tesla fans has been “the China market.” Sadly, that government’s love affair with Tesla is over and Q2 Tesla sales there were down 10% from Q1 while Q3 looks to be down approximately 10% more. In July Tesla sold just 8621 cars in China (with the balance of that month’s production exported to Europe) and in August only 12,885. This an absolute disaster for Tesla, as massive July price cuts on both the Model Y and the Model 3 meant that in August in China it was supposed to sell around 30,000; instead it had to export all that excess capacity. (It still may sell around 50,000 in China in September, but so what? With insignificantly small sequential growth for three quarters now, Tesla’s Chinese “hypergrowth” story is over.) Remember when Musk claimed Tesla would have so much domestic Chinese demand that it would need multiple factories there to satisfy it? Ah, the good old days! Another favorite Tesla hype story has been built around so-called “proprietary battery technology.” In fact though, Tesla has nothing proprietary there—it doesn’t make them, it buys them from Panasonic, CATL and LG, and it’s the biggest liar in the industry regarding the real-world range of its cars. A recent story has been the supposedly imminent arrival of a new “4680” design that Teslemmings and their sell-side Wall Street shills claim will allow Tesla to “leapfrog” the batteries of its competitors. Sadly for them though, in a June interview with the CEO of Tesla’s primary battery supplier Panasonic, we learned that not only are these cells still in the “production testing” phase (and thus nowhere near ready for commercial production), but that if they *do* work, Panasonic will sell them to anyone.  And then news broke that Tesla extended its current battery supply deal with CATL until the year 2025, and in August it revealed it will even be using those Chinese-made batteries in the U.S. If those great proprietary 4680s were coming any time soon, why would Tesla need to do that? Obviously it wouldn’t, which explains why in the Q2 earnings press release (and on the call) Musk admitted they don’t know how long (if ever) it will take to get those 4680 batteries into production. Oh well… I guess it’s on to the next nonsensical stock pump! Meanwhile, the quality of the Model Y—is awful, and that car faces current (or imminent) competition from the much better built electric Audi Q4 e-tron, BMW iX3, Mercedes EQA, Volvo XC40 Recharge, Volkswagen ID.4, Ford Mustang Mach E, Nissan Ariya, Hyundai Ioniq 5 and Kia EV6. And Tesla’s Model 3 now has terrific direct “sedan competition” from Volvo’s beautiful Polestar 2 and the premium version of Volkswagen’s ID.3 (in Europe), and later this year from the BMW i4, plus multiple local competitors in China. And in the high-end electric car segment worldwide the Audi e-tron and Porsche Taycan outsell the Models S & X (and the newly updated Tesla models with their dated exteriors and idiotic shifters & steering wheels won’t change this), while the spectacular new Mercedes EQS and Audi e-Tron GT make any Tesla look like a Yugo, while the extremely well reviewed new BMW iX does the same to the Tesla Model X. And oh, the joke of a “pickup truck” Tesla previewed in 2019 (and still hasn’t shown in production-ready form) won’t be much of “growth engine” either, as it will enter a dogfight of a market; in fact, in May Ford formally introduced its terrific new all-electric F-150 Lightning which now has over 150,000 reservations and Rivian’s pick-up has gotten fantastic early reviews. Also, the Tesla semi-truck  has been delayed until at least 2022 (and possibly forever, as it depends on the aforementioned “4680” batteries that don’t exist). Meanwhile, Tesla quality ranks 30th among 33 brands in the most recent J.D. Power dependability survey… …and second-to-last in the most recent Consumer Reports reliability survey: …while the most recent What Car? survey shows similar results with Tesla finishing #29 out of 31, and now quality is slipping in China. Flawed Autopilot System Regarding safety, as noted earlier in this letter, Tesla continues to deceptively sell its hugely dangerous so-called “Autopilot” system, which Consumer Reports has completely eviscerated; God only knows how many more people this monstrosity unleashed on public roads will kill, despite the NTSB condemning it. Elsewhere in safety, in 2020 the Chinese government forced the recall of tens of thousands of Teslas for a dangerous suspension defect the company spent years trying to cover up, and now Tesla has been hit by a class-action lawsuit in the U.S. for the same defect. Tesla also knowingly sold cars that it knew were a fire hazard and did the same with solar systems, and after initially refusing to do so voluntarily, it was forced to recall a dangerously defective touchscreen. In other words, when it comes to the safety of customers and innocent bystanders, Tesla is truly one of the most vile companies on Earth. Meanwhile the massive number of lawsuits of all types against the company continues to escalate. So here is Tesla’s competition in cars... (note: these links are regularly updated) Porsche Taycan Porsche Taycan Cross Turismo Porsche Macan Electric SUV Officially Coming in 2023 Volkswagen ID.3 Headlines VW's Electrified Future Volkswagen ID.4 Electric SUV Volkswagen ID 6 to arrive with 435-mile range in 2023 Volkswagen Aero B: new electric Passat equivalent spied VW’s Cupra brand counts on performance for Born EV Cupra, VW brand to get entry-level battery-powered cars Audi e-tron Audi e-tron Sportback Audi E-tron GT Audi Q4 e-tron Audi Q6 e-tron confirmed for 2022 launch Audi previews long-range A6 e-tron EV Audi TT set to morph into all-electric crossover Hyundai Ioniq 5 Hyundai Ioniq 6 spotted ahead of 2022 launch Hyundai Kona Electric Genesis reveals their first EV on the E-GMP platform, the electric GV60 crossover Genesis aims to go all-electric from 2025 Kia Niro Electric: 239-mile range & $39,000 before subsidies Kia EV6: Charging towards the future Kia EV4 on course to grow electric SUV range Jaguar’s All-Electric i-Pace Jaguar to become all-electric brand; Land Rover to Get 6 electric models Daimler will invest more than $47B in EVs and be all-electric ready by 2030 Mercedes EQS: the first electric vehicle in the luxury class Mercedes EQS SUV takes shape Mercedes-Benz unveils EQE electric sedan with impressive 400-mile range Mercedes EQC electric SUV available now in Europe & China Mercedes-Benz Launches the EQV, its First Fully-Electric Passenger Van Mercedes-Benz EQB Makes Its European Debut, US Sales Confirmed Mercedes-Benz unveils EQA electric SUV with 265 miles of range and ~$46,000 price Ford Mustang Mach-E Available Now Ford F-150 Lightning electric pick-up available 2022 Ford set to launch ‘mini Mustang Mach-E’ electric SUV in 2023 Ford to offer EV versions of Explorer, Aviator, ‘rugged SUVs' Volvo Polestar 2 Volvo XC40 Recharge Volvo C40 electric sedan to challenge Tesla Model 3, VW ID3 Polestar 3 will be an electric SUV that shares its all-new platform with next Volvo XC90 Chevy updates, expands Bolt EV family as price drops Cadillac All-Electric Lyriq Available Spring 2022 GMC ALL-ELECTRIC SUPERTRUCK HUMMER EV GM to build electric Silverado in Detroit with estimated range of more than 400 miles GMC to launch electric Hummer SUV in 2023 GM will offer 30 all-electric models globally by 2025 GM Launches BrightDrop to Electrify the Delivery of Goods and Services Nissan vows to hop back on EV podium with Ariya Nissan LEAF e+ with 226-mile range is available now BMW leads off EV offensive with iX3 BMW expands EV offerings with iX tech flagship and i4 sedan 2022 BMW iX1 electric SUV spied BMW 3-series EV coming Rivian R1T Is the Most Remarkable Pickup We’ve Ever Driven Renault upgrades Zoe electric car as competition intensifies Renault Dacia Spring Electric SUV Renault to boost low-volume Alpine brand with 3 EVs Renault's electric Megane will debut new digital cockpit Stellantis promises 'heart-of-the-market SUV' from new, 8-vehicle EV platform Alfa Romeo is latest Stellantis brand to get all-electric future Peugeot e-208 PEUGEOT E-2008: THE ELECTRIC AND VERSATILE SUV Peugeot 308 will get full-electric version Citroen compact EV challenges VW ID3 on price Maserati to launch electric sports car Mini Cooper SE Electric Toyota steps up electric vehicle push with plans for 15 new models Opel sees electric Corsa as key EV entry 2021 Vauxhall Mokka revealed as EV with sharp looks, massive changes Skoda Enyaq iV electric SUV offers range of power, battery sizes Electric Skoda Enyaq coupe to muscle-in on Tesla Model 3 Skoda plans small EV, cheaper variants to take on French, Korean rivals Nio to launch in five more European countries after Norway BYD will launch electric SUV in Europe The Lucid Air Achieves an Estimated EPA Range of 517 Miles on a Single Charge Bentley converting to electric-only brand Rolls-Royce is working on EV called 'Silent Shadow' Aston Martin will build electric vehicles in UK from 2025 Meet the Canoo, a Subscription-Only EV Pod Coming in 2021 Two new electric cars from Mahindra in India; Global Tesla rival e-car soon Former Saab factory gets new life building solar-powered Sono Sion electric cars Foxconn aims for 10% of electric car platform market by 2025 And in China… How VW Group plans to dominate China's EV market VW Goes Head-to-Head With Tesla in China With New ID.4 Crozz Electric SUV Volkswagen’s ID.3 EV to be produced by JVs with SAIC, FAW in 2021 2022 VW ID.6 Revealed With Room For Seven And Two Electric Motors China-built Audi e-tron rolls off production line in Changchun Audi Q2L e-tron debuts at Auto Shanghai Audi will build Q4 e-tron in China Audi in cooperation company for local electric car production with FAW FAW Hongqi starts selling electric SUV with 400km range for $32,000 FAW (Hongqi) to roll out 15 electric models by 2025 BYD goes after market left open by Tesla with four cheaper models for budget-conscious buyers BYD said to launch premium NEV brand ‘Dolphin’ in 2022 Top of Form Bottom of Form Daimler & BYD launch DENZA electric vehicle for the Chinese market Geely announces premium EV brand Zeekr Geely, Mercedes-Benz launch $780 million JV to make electric smart-branded cars Mercedes styled Denza X 7-seat electric SUV to hit market Mercedes ‘makes mark’ with China-built EQC BMW, Great Wall to build new China plant for electric cars BAIC Goes Electric, & Establishes Itself as a Force in China’s New Energy Vehicle Future BAIC BJEV, Magna ready to pour RMB2 bln in all-electric PV manufacturing JV Toyota, BYD will jointly develop electric vehicles for China Lexus to launch EV in China taking on VW and Tesla GAC Aion about to start volume production of 1,000-km range AION LX GAC Toyota to ramp up annual capacity by 400,000 NEVs GAC kicks off delivery of HYCAN 007 all-electric SUV Nio – Ready For Tomorrow Nio steps up plans for mass-market brand to compete with VW, Toyota Xpeng Motors sells multiple EV models SAIC-GM to build Ultium EV platform in Wuhan Chevrolet Menlo Electric Vehicle Launched in China Buick Launches VELITE 6 PLUS MAV Electric Vehicle in China Buick Velite 7 EV And Velite 6 PHEV Launch In China Dongfeng launches the all-electric Voyah  PSA to accelerate rollout of electrified vehicles in China SAIC, Alibaba-backed EV brand IM begins presale of first model L7 Hyundai Motor Transforming Chongqing Factory into Electric Vehicle Plant Polestar said to plan China showroom expansion to compete with Tesla Jaguar Land Rover's Chinese arm invests £800m in EV production Renault reveals series urban e-SUV K-ZE for China Renault & Brilliance detail electric van lineup for China Renault forms China electric vehicle venture with JMCG Honda to roll out over 20 electric models in China by 2025 Geely launches new electric car brand 'Geometry' – will launch 10 EVs by 2025 Geely, Foxconn form partnership to build cars for other automakers Fiat Chrysler, Foxconn Team Up for Electric Vehicles Baidu to create an intelligent EV company with automaker Geely Leapmotor starts presale of C11 electric SUV on Jan. 1 2021 Changan forms subsidiary Avatar Technology to develop smart EVs with Huawei, CATL WM Motors/Weltmeister Chery Seres Enovate China's cute Ora R1 electric hatch offers a huge range for less than US$9,000 Singulato JAC Motors releases new product planning, including many NEVs Seat to make purely electric cars with JAC VW in China Iconiq Motors Hozon Aiways Skyworth Auto Youxia CHJ Automotive begins to accept orders of Leading Ideal ONE Infiniti to launch Chinese-built EV in 2022 Human Horizons Chinese smartphone giant Xiaomi to launch electric car business with $10 billion investment Lifan Technology to roll out three EV models with swappable batteries in 2021 Here’s Tesla’s Competition In Autonomous Driving... Waymo ranked top & Tesla last in Guidehouse leaderboard on automated driving systems Tesla has a self-driving strategy other companies abandoned years ago Fiat Chrysler, Waymo expand self-driving partnership for passenger, delivery vehicles Waymo and Lyft partner to scale self-driving robotaxi service in Phoenix Volvo, Waymo partner to build self-driving vehicles Jaguar and Waymo announce an electric, fully autonomous car Renault, Nissan partner with Waymo for self-driving vehicles Cruise and GM Team Up with Microsoft to Commercialize Self-Driving Vehicles Cadillac Super Cruise Sets the Standard for Hands-Free Highway Driving Honda Joins with Cruise and General Motors to Build New Autonomous Vehicle Honda launching Level 3 autonomous cars Volkswagen moves ahead with Autonomous Driving R&D for Mobility as a Service Volkswagen teams up with Microsoft to accelerate the development of automated driving VW taps Baidu's Apollo platform to develop self-driving cars in China Ford's electric Mustang will offer hands-free driving technology in 2021 ARGO AI AND FORD TO LAUNCH SELF-DRIVING VEHICLES ON LYFT NETWORK BY END OF 2021 Hyundai and Kia Invest in Aurora Toyota, Denso form robotaxi partnership with Aurora Aptiv and Hyundai Motor Group complete formation of autonomous driving joint venture Amazon’s Zoox unveils electric robotaxi that can travel up to 75 mph Nvidia and Mercedes Team Up to Make Next-Gen Vehicles Daimler's heavy trucks start self-driving some of the way SoftBank, Toyota's self-driving car venture adds Mazda, Suzuki, Subaru Corp, Isuzu Daihatsu  Continental & NVIDIA Partner to Enable Production of Artificial Intelligence Self-Driving Cars Mobileye and Geely to Offer Most Robust Driver Assistance Features Mobileye Starts Testing Self-Driving Vehicles in Germany Mobileye and NIO Partner to Bring Level 4 Autonomous Vehicles to Consumers Lucid Chooses Mobileye as Partner for Autonomous Vehicle Technology AutoX, backed by Alibaba Nissan gives Japan version of Infiniti Q50 hands-free highway driving Hyundai to start autonomous ride-sharing service in Calif. Pony.ai raises $462 million in Toyota-led funding Baidu kicks off trial operation of Apollo robotaxi in Changsha Toyota to join Baidu's open-source self-driving platform Baidu, WM Motor announce strategic partnership for L3, L4 autonomous driving solutions Volvo will provide cars for Didi's self-driving test fleet BMW and Tencent to develop self-driving car technology together BMW, NavInfo bolster partnership in HD map service for autonomous cars in China GM Invests $300 M in Momenta to deliver self-driving technologies in China FAW Hongqi readies electric SUV offering Level 4 autonomous driving Tencent, Changan Auto Announce Autonomous-Vehicle Joint Venture Huawei teams up with BAIC BJEV, Changan, GAC to co-launch self-driving car brands GAC Aion, DiDi Autonomous Driving to co-develop driverless NEV model BYD partners with Huawei for autonomous driving Lyft, Magna in Deal to Develop Hardware, Software for Self-Driving Cars Xpeng releases autonomous features for highway driving Nuro Becomes First Driverless Car Delivery Service in California Deutsche Post to Deploy Test Fleet Of Fully Autonomous Delivery Trucks ZF autonomous EV venture names first customer Magna’s new MAX4 self-driving platform offers autonomy up to Level 4 Groupe PSA’s safe and intuitive autonomous car tested by the general public Mitsubishi Electric to Exhibit Autonomous-driving Technologies in New xAUTO Test Vehicle Apple acquires self-driving startup Drive.ai Motional to begin robotaxi testing with Hyundai Ioniq 5 in Los Angeles JD.com Delivers on Self-Driving Electric Trucks NAVYA Unveils First Fully Autonomous Taxi Fujitsu and HERE to partner on advanced mobility services and autonomous driving Here’s where Tesla’s competition will get its battery cells… Panasonic (making deals with multiple automakers) LG Samsung SK Innovation Toshiba CATL BYD Volkswagen to Build Six Electric-Vehicle Battery Factories in Europe How GM's Ultium Battery Will Help It Commit to an Electric Future Ultium (General Motors & LG joint venture) GM to develop lithium-metal batteries with SolidEnergy Systems Ford, SK Innovation announce EV battery joint venture BMW & Ford Invest in Solid Power to Secure All Solid-State Batteries for Future Electric Vehicles Daimler joins Stellantis as partner in European battery cell venture ACC Renault signs EV battery deals with Envision, Verkor for French plants Nissan to build $1.4bn EV battery plant in UK with Chinese partner UK companies AMTE Power and Britishvolt plan $4.9 billion investment in battery plants Toyota's game-changing solid-state battery en route for 2021 debut Freyr Verkor Farasis Microvast Akasol Cenat Wanxiang Eve Energy Svolt Romeo Power ProLogium Hyundai Motor developing solid-state EV batteries Daimler Morrow Here’s Tesla’s Competition In Charging Networks... Electrify America is spending $2 billion building a high-speed U.S. charging network GM, EVgo partner to expand U.S. charging network Circle K Owner Plans Electric-Car Charging Push in U.S., Canada 191 U.S. Porsche dealers are installing 350kw chargers ChargePoint to equip Daimler dealers with electric car chargers GM and Bechtel plan to build thousands of electric car charging stations across the US Ford introduces 12,000 station charging network, teams with Amazon on home installation Shell Plans To Deploy Around 500,000 Charging Points Globally By 2025 Petro-Canada Introduces Coast-to-Coast Canadian Charging Network Volta is rolling out a free charging network Ionity Europe E.ON and Virta launch one of the largest intelligent EV charging networks in Europe Volkswagen plans 36,000 charging points for electric cars throughout Europe Smatric has over 400 charging points in Austria Allego has hundreds of chargers in Europe PodPoint UK charging stations BP Chargemaster/Polar is building stations across the UK Instavolt is rolling out a UK charging network Fastned building 150kw-350kw chargers in Europe Aral To Install Over 100 Ultra-Fast Chargers In Germany Deutsche Telekom launches installation of charging network for e-cars Total to build 1,000 high-powered charging points at 300 European service-stations NIO teams up with China’s State Grid to build battery charging, swapping stations Volkswagen-based CAMS launches supercharging stations in China Volkswagen, FAW Group, JAC Motors, Star Charge formally announce new EV charging JV BMW to Build 360,000 Charging Points in China to Juice Electric Car Sales BP, Didi Jump on Electric-Vehicle Charging Bandwagon Evie rolls out ultrafast charging network in Australia Evie Networks To Install 42 Ultra-Fast Charging Sites In Australia And here’s Tesla’s competition in storage batteries… Panasonic Samsung LG BYD AES + Siemens (Fluence) GE Bosch Hitachi ABB Toshiba Saft Johnson Contols EnerSys SOLARWATT Schneider Electric Sonnen Kyocera Generac Kokam NantEnergy Eaton Nissan Tesvolt Kreisel Leclanche Lockheed Martin EOS Energy Storage ESS UET electrIQ Power Belectric Stem ENGIE Redflow Renault Primus Power Simpliphi Power redT Energy Storage Murata Bluestorage Adara Blue Planet Tabuchi Electric Aggreko Orison Moixa Powin Energy Nidec Powervault Kore Power Shanghai Electric Schmid 24M Ecoult Innolith LithiumWerks Natron Energy Energy Vault Ambri Voltstorage Cadenza Innovation Morrow Gridtential Villara Elestor Thanks and stay healthy, Mark Spiegel Updated on Oct 1, 2021, 11:05 am (function() { var sc = document.createElement("script"); sc.type = "text/javascript"; sc.async = true;sc.src = "//mixi.media/data/js/95481.js"; sc.charset = "utf-8";var s = document.getElementsByTagName("script")[0]; s.parentNode.insertBefore(sc, s); }()); window._F20 = window._F20 || []; _F20.push({container: 'F20WidgetContainer', placement: '', count: 3}); _F20.push({finish: true});.....»»

Category: blogSource: valuewalkOct 1st, 2021

Stocks Up for the Week After Soaring Over 2% in 2 Days

Stocks Up for the Week After Soaring Over 2% in 2 Days Not only did yesterday’s post-Fed rally continue on Thursday, but it also picked up steam and left the major indices with a chance for their first positive weekly performance since the beginning of September. The Dow surged by 1.48% (or about 506 points) to 34,764.82, while the S&P jumped 1.21% to 4448.98. The NASDAQ improved 1.04% (or around 155 points) to 15,052.24. All of these indices are now up more than 2% in the past 2 days. We’re enjoying the first real rally for stocks during this difficult month of September. In fact, it’s the first time the major indices all advanced by more than 1% since July 20. And now stocks are in striking distance of snapping a two-week slump with a solid performance on Friday. (The Dow has actually been in the red for three straight weeks.) Big moves after a Fed statement are normal… and sometimes this action goes in the oppositive direction as the day before. However, investors are obviously still feeling pretty good about what they heard yesterday. Basically, the stimulus policies that helped us survive the pandemic will stay put for now. However, we’re growing closer to scaling back the asset purchase program now that the Fed’s inflation and employment mandates are nearly met. We’ll most likely get an announcement in the next Fed meeting before the end of the year. “Despite the more hawkish tone from Fed Chair Powell yesterday afternoon, it seemed to be what the markets wanted to hear,” said Dan Laboe in Headline Trader. “As I have said in previous commentaries, a tapering timetable from the Fed now comes as a relief due to its implications on our economic health.” In a nutshell, the economic recovery is still moving forward despite the delta variant, and the progress is so substantial that it’s time to start thinking about throwing the crutches away. The Evergrande situation continues to be a potential problem, as China’s largest property developer remains precariously close to defaulting after taking on a debt load of approximately $300 billion. The company resolved a $36 million interest payment yesterday, which allowed for some breathing room on Thursday. But Evergrande is still in trouble as investors wonder if the Chinese government will let it fail or not. We’ll be watching this story with great interest in the days ahead. We’ll also be keeping a close eye on Washington here at home as it attempts to stop a government shutdown by raising the debt ceiling. The jobless claims report on Thursday was a bit of a disappointment, but fortunately it didn’t get much attention considering all the other news. The print came to 351,000 claims last week, which was more than expectations of 320K and the previous week’s 335K. It would be quite a feat for stocks to finish this week in the green after such a rough start on Monday. Let’s see what happens tomorrow... Today's Portfolio Highlights: Technology Innovators: The market is heating up after a cold start to September, so Brian decided to turn up the temperature in this portfolio by adding Thermon Group Holding (THR). This Zacks Rank #2 (Buy) is engaged in thermal solutions, known as heat tracing, for process industries such as energy, chemical processing and power generation. The editor thinks that this company, which has maintained profitability throughout the last year, is poised to turn around and head back to recent highs. THR saw topline growth of 25% in the most recent quarter while margins have advanced to 5.9% from 3.7%, which could potentially boost EPS moving forward. Read the full write-up for more on this new buy and get ready for two additions next week as Brian works to get the portfolio fully invested with 15 names. Home Run Investor: If you want to get more aggressive in your portfolio (as Brian wants to do with the market on the rise), then the chip space is a good place to make that happen. The editor bought again on Thursday by picking up Camtek (CAMT), which makes automatic optical inspection systems for several industries, including semiconductor manufacturing & packaging. The company has beaten the Zacks Consensus Estimate three times and matched once over the past four quarters, while rising earnings estimates gave CAMT a Zacks Rank #2 (Buy) status. Meanwhile, Brian also sold defensive pick BellRing Brands (BRBR) for a slight loss. See the complete commentary for more on all of today’s action. Stocks Under $10: The staffing business is booming right now, which is why Brian added RCM Technologies (RCMT) over a week ago. The stock is still in the red since being picked up on September 14, but things may be about to change. The stock was the best performer among all ZU names on Thursday with a surge of nearly 14%. Remember, the service’s biggest winner is staffing firm Cross Country Health (CCRN), which has soared 157% in ten months. See You Friday, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 24th, 2021

Dow Jumps 1.4% as Stocks Gain for Second Straight Week

Dow Jumps 1.4% as Stocks Gain for Second Straight Week The Dow needed a really good session on Friday to finish this week in the green… and that’s exactly what it got! Encouraging vaccine news – combined with the market’s overall resilience to rising coronavirus cases – led to solid gains for each of the major indices. The Dow began the day lower by 0.4% for the week, but finished with an ADVANCE of just under 1% for the five days. The index jumped 1.44% (or nearly 370 points) today to 26,075.30. The S&P rose 1.05% to 3185.04 to finish the week with a 1.8% advance. We know how influential the daily headlines can be on this market right now, and luckily we got a positive one today. Gilead’s remdesivir vaccine candidate had some good trial data by showing a reduction in the risk of death for coronavirus patients. The market absolutely LOVES this kind of news because nothing would help the economic recovery more than eradicating this virus once and for all. In fact, stocks that are tied to the reopenings did well today. But don’t feel too bad for the trailblazing tech space, which has been leading the market higher for a while now. The NASDAQ did uncharacteristically underperform its counterparts today, but the index still added 0.66% (or nearly 70 points) to log another record high of 10,617.44. It was up 4% for the week. The indices now have back-to-back winning runs after the NASDAQ and S&P both jumped 4% last week and the Dow advanced 3.2%. We’ll have to deal with all the same challenges and concerns when we get back to work on Monday, especially the rising number of cases and stalled reopening plans. As if that wasn’t enough, we’ll also be watching the beginning of earnings season in the days ahead. Economic data has been pretty good of late and stocks are largely shrugging off the case count, but what will the quarterly results tell us? Let’s enjoy the weekend and get ready for another crazy week in the market. Today's Portfolio Highlights: Surprise Trader: For the second time this week, the portfolio added a name from the highly ranked transportation – truck industry (top 37%). Dave bought Heartland Express (HTLD) on Wednesday and today he picked up Marten Transport (MRTN). This Zacks Rank #2 (Buy) long-haul truckload carrier beat by nearly 4.2% in its last report, and now has a positive Earnings ESP of 4.35% for the one coming after the bell on Thursday, July 16. The editor added MRTN on Friday with a 12.5% allocation. He also sold Franklin Covey (FC), which turned out to be a “total dud from the start”. Read the full write-up for more on today’s moves. By the way, this portfolio had a the best performer of the day among all ZU names as Sleep Number (SNBR) jumped nearly 13.2%. Technology Innovators: It may take a little more intestinal fortitude, but Brian is looking to add stocks that are near their highs right now. On Friday, he picked up PLDT (PHI), a Zacks Rank #1 (Strong Buy) wireless play in the Philippines. The stock bounced higher earlier this month and looks like it will continue to run well into the $30s. And as its high Zacks Rank shows, earnings estimates are moving upward for this year and next. The editor even likes its valuation. PHI may be able to get into the mid-$40s down the road, so Brian is adding it now. Read the full write-up for more. The portfolio also had the second best performer of the session with Tesla (TSLA) gaining 10.8%.  Counterstrike: "The market has no fear of the virus. In fact, it seems to think a vaccine will come soon or the new surge will blow over. Its pretty amazing to get this euphoria in this COVID atmosphere, but the Fed’s easy money policy had sparked the fire. New buys on Monday." -- Jeremy Mullin Have a Great Weekend! Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

S&P, Dow Reach Record Highs for Fourth Consecutive Session

S&P, Dow Reach Record Highs for Fourth Consecutive Session If it weren’t for all the new highs, you could call this a boring week for the market. Two of the major indices grinded higher and set fresh records throughout the period, yet their weekly advances were less than 1% amid a deluge of economic data and earnings reports. The S&P was the best performer on Friday with a mighty rise of 0.16% to 4468, while the Dow increased 0.04% (or about 15 points) to 35,515.38. That makes four consecutive days of record highs for both indices, yet advances of only 0.7% and 0.9%, respectively, for the week. The NASDAQ was also up 0.04% (or around 6 points) to 14,822.90 today, giving it a tiny loss of just under 13 points (or less than 0.1%) for the five days. We kicked things off on Monday still excited by news that the economy added 943K jobs in July, and then learned that the Senate approved the $1 trillion infrastructure bill. The next two days included inflation indicators (CPI & PPI) that showed prices still rocketing higher, but not as badly as many investors feared. And jobless claims yesterday were acceptable with a decline week over week and the print staying below 400K. The data deluge continued on Friday, as the University of Michigan consumer confidence number dipped to 70.2 for August. That’s well below expectations and the previous month’s result in the low 80s. “We could speculate why this is, but I think its simply the combination of the delta variant and inflation headlines,” said Jeremy Mullin in Counterstrike. “We are bombarded with this news and I think the consumer is reacting to that news.” “Bombarded” is a good word. Yet throughout all the data, stocks grinded higher as the economic recovery seems to be moving along despite the challenges. And the strong earnings season has certainly helped to keep the market’s spirits up. The number of S&P companies that have beaten earnings and revenue expectations so far remain over 85% for each. Our Director of Research Sheraz Mian continues to analyze the numbers and just posted his most recent Earnings Preview article titled: “3 Things to Know About the Q2 Earnings Season”. And we’re not done yet, as some of the biggest retailers are set to come to the plate next week. We’ll be seeing reports from the likes of Walmart (WMT), Target (TGT), Home Depot (HD), Lowes (LOW), Deere (DE) as well as a few tech stragglers like NVIDIA (NVDA), Cisco (CSCO) and Applied Materials (AMAT). Over 95% of the S&P will have reported by the end of next week. Today's Portfolio Highlights: Surprise Trader: The final addition of the week is Agilent Tech (A), which will look to continue its streak of positive earnings surprises when it reports again after the bell on Tuesday, August 17. This Zacks Rank #2 (Buy) is an OEM of a broad-based portfolio of test and measurement products serving multiple end markets. It beat the Zacks Consensus Estimate by 18% last time and has a small positive Earnings ESP heading into next week’s print. Dave added A on Friday with a 12.5% allocation, while also selling the underperforming Rackspace (RXT) and GrowGeneration (GRWG) positions. See the complete commentary for more on today’s action. Counterstrike: Shares of F5 Networks (FFIV) soared to just under all-time highs after a solid quarterly report last month, but has since pulled back in what looks like a technical move down to the 21-day at $200. That makes it a great candidate for this portfolio. FFIV is a Zacks Rank #2 (Buy) provider of multi-cloud application services that beat earnings estimates by 11% recently while also boosting its fourth-quarter outlook. Jeremy added FFIV on Friday with a small 5% allocation with plans to add if the support holds. The editor also sold the stalling Thor Industries (THO) for a 10% return in just under two months and half of Ulta Beauty (ULTA) for 9.7% in about the same amount of time. He also sold Foot Locker (FL) ahead of its earnings report next month. Read the full write-up for more on today’s moves and the portfolio in general.     Insider Trader: A nice small cluster buy from a few key insiders at Dun & Bradstreet (DNB) convinced Tracey to add this provider of business decisioning data and analytics on Friday. The company has been around for decades, but it only went IPO last year. Shares are down 32% since the IPO, including a slide of 15% in the wake of the earnings report. But here’s the thing… nobody thinks the earnings report was that bad. So the selloff was overdone and the stock is now a value. Earlier this week, the CEO, the CFO and the Chief Legal Officer all bought shares… and you know how much the editor likes to see the usually-conservative chief lawyer put some money to work. She decided to join the bandwagon and add DNB with a 10% allocation today. Get more specifics in the complete write-up. Have a Great Weekend! Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Stocks Down Again but Positive Week Still Possible

Stocks Down Again but Positive Week Still Possible SPECIAL ALERT: Remember, the September episode of the Zacks Ultimate Strategy Session is now available for viewing! Don’t miss your chance to hear:   ▪ Kevin Cook and Dr. John Blank Agree to Disagree on where the S&P 500 will end in 2021   ▪ Kevin Matras answers questions covering Breakaway, Runaway and Exhaustion gaps in Zacks Mailbag ▪ Sheraz Mian and Daniel Laboe choose one portfolio to give feedback for improvement ▪ Market conditions from both fundamental and technical views ▪ The full list of top-performing stocks over the past 30 days ▪ New stocks added to the Zacks Ultimate portfolio ▪ And much more Simply log on to Zacks.com and view the September episode here. And please let us know what you think of these monthly episodes. Email all feedback to mailbag@zacks.com. The good thing about this short and boring week is that it’s almost over. All of the major indices declined for a second straight session on Thursday, while two of them now have four-day losing streaks as investors worry about the delta variant impacting growth. The S&P slipped 0.46% today to 4493.28, while the Dow was off 0.43% (or about 151 points) to 34,879.38. These indices haven’t closed in the green since last Thursday just before the disheartening jobs report for August. The NASDAQ held up well under these challenges early on and even reached a new record on Tuesday but has now slumped for two straight sessions. It was off 0.25% (or about 38 points) today to 15,248.25. “The broader public equity market is yet to show any directional impetus since September began,” said Dan Laboe in Headline Trader. “As we all know, September is historically the weakest month for equities, and precariously, market participants are determining whether the recovering economic momentum from the Delta-dent will push the stocks another leg higher or if it's time to start taking some protective measures.” But despite all the declines in recent days, it’s important to note that volume has been very low. Stocks are still in the neighborhood of all-time highs and could possibly finish the week on positive ground with a late rally. The Dow is down by about 1.4% over the past three days heading into Friday, while the other major indices are off by less than 1%. “Right now, the bears are in charge, but they don't have their hands tightly on the reins. The bulls could be back at any time,” said Tracey Ryniec in Insider Trader. We received another encouraging jobless claims report on Thursday, as the print came to only 310,000. The result was better than expectations at 335K and the previous week’s 340K. It also marks another pandemic-era low, which is a welcomed development for an economy that's wondering about the health of this recovery. Well, let’s see if the market can finally pick a direction and rally out this short week on Friday. Maybe we can still finish with gains for these four days. Weirder things have happened… Today's Portfolio Highlights: Insider Trader: Have you experienced any trouble buying clothes recently? Seen a lot of “sold out” signs of late? The problem is that many apparel retailers are suffering from severe supply chain issues that have many investors wondering if there’ll be enough product to match the rising demand. That’s what happened to Abercrombie (ANF), as shares plunged after its second quarter report despite “crushing” expectations and earning more in one quarter than in any year since 2013. Even with these complications though, a director bought 1000 shares on Sept 2. Tracey thinks this insider sees a bargain after the pullback. The editor added ANF on Thursday with a 10% position, though warns this is a “risky addition” that could be very volatile. In other news, Tracey also sold half of Digital Turbine (APPS) for a nice 21% return in less than two weeks and all of Dollar Tree (DLTR) since “it’s not going anywhere”. Read the full write-up for more on all of today’s action. Meanwhile, APPS was also a top performer today by climbing 4.8%, while ONESPAN (OSPN) made the list with a gain of 4.2%. Blockchain Innovators: Simply put, you don’t offer wire transfer and processing services in the 21st century without blockchain. Therefore, International Money Express (IMXI) is a pure play in the field, especially when you consider that the company partners with Ripple to use their On-Demand Liquidity product to send money in real time across international borders. IMXI is a Zacks Rank #2 (Buy) with a strong earnings trend that started back in the second half of 2020. Revenue growth is impressive at 24.72% this year and 12.36% next year. Dave added IMXI to the portfolio on Thursday, while also selling CalAmp (CAMP). Read the full write-up for more on today’s moves. In other news, this portfolio also had the top performer on Thursday as iClick Interactive Asia Group (ICLK) jumped 11.5%.  Headline Trader: "It was another fruitless battle between bulls and bears who have shown progressively less conviction on each side of both sides of the equation. "All the major blue-chip indices oscillated around even for most of the day with no substantial enough catalyst to persuade market-moving institutions to gain any bullish traction, leading to a broad afternoon market spill. "The recent market price action indicates that public equities are fully (if not more than adequately) priced at these levels. I would love to see a broader public equity dip, which would undoubtedly inspire fresh bullish capital to slingshot the markets another level higher." -- Dan Laboe See You Friday, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Truist Financial (TFC) Q3 Earnings Beat Despite Higher Costs

Truist Financial (TFC) records a marginal rise in revenues in the third quarter of 2021. Truist Financial’s TFC third-quarter 2021 adjusted earnings of $1.42 per share easily surpassed the Zacks Consensus Estimate of $1.20. The bottom line jumped 46.4% from the prior-year quarter.Results were aided by strong performance from its insurance business, wealth management business, investment banking business, and card and payment related fees. This supported fee income growth, which along with provision benefits acted as a tailwind.However, lower interest rates and a fall in loan balances hurt net interest income (NII). Higher operating expenses posed another undermining factor.Results for the reported quarter excluded restructuring and BB&T-SunTrust Banks merger-related charges, incremental operating expenses related to the merger, and one-time professional fee expenses. After considering these, net income available to common shareholders (GAAP basis) was $1.62 billion or $1.20 per share, up from $1.07 billion or 79 cents per share in the prior-year quarter.Revenues Improve Marginally, Expenses RiseTotal revenues were $5.60 billion, up marginally year over year. The top line beat the Zacks Consensus Estimate of $5.52 billion.Tax-equivalent NII decreased 3.8% from the year-ago quarter to $3.26 billion. The decline was due to a fall in purchase accounting accretion, lower rates on earning assets and a decrease in loans, partially offset by growth in the securities portfolio, lower funding costs, higher fees on Payroll Protection Program loans and fewer interest deferrals on COVID-19 loan accommodations.Net interest margin contracted 29 basis points (bps) year over year to 2.81%.Non-interest income increased 7% to $2.37 billion. Excluding securities gains, fee income grew 12% year over year.Non-interest expenses were $3.80 billion, up 1.1% from the prior-year quarter. Adjusted expenses rose 3.5%.The adjusted efficiency ratio was 57.9%, up from 57.3% in third-quarter 2020. A rise in efficiency ratio indicates deterioration in profitability.As of Sep 30, 2021, total average deposits were $402.7 billion, up 1.6% from the prior quarter. Average total loans and leases of $290.3 billion declined nearly 1% sequentially.Credit Quality ImprovesAs of Sep 30, 2021, total non-performing assets (NPAs) were $1.2 billion, down 8.4% year over year. As a percentage of total assets, NPAs were 0.23%, decreasing 3 bps year over year.Allowance for loan and lease losses was 1.65% of total loans and leases held for investment, which decreased 26 bps. Provision for credit losses was a benefit of $324 million against a provision of $421 in the prior-year quarter. Reserve releases, owing to improving economic outlook, led to provision benefits.Net charge-offs were 0.19% of average loans and leases, down 23 bps from the year-ago quarter.Profitability & Capital Ratios RobustAt the end of the reported quarter, return on average assets was 1.28%, up from 0.91% in the prior-year quarter. Return on average common equity was 10.2%, up from 6.9% in the third quarter of 2020.As of Sep 30, 2021, Tier 1 risk-based capital ratio was 11.9% compared with 12.2% recorded in the prior-year quarter. Common equity Tier 1 ratio was 10.1% as of Sep 30, 2021, up from 10.0% as of Sep 30, 2020.Capital Deployment UpdateIn the quarter under review, Truist Financial did not repurchase any shares.The company continues to expect to be able to deploy $4-$5 billion of capital (either in the form of share buybacks or acquisitions) through third-quarter 2022.Our TakeTruist Financial’s efforts to capitalize on the investment banking and insurance businesses bode well. It completed the acquisition of the insurance distribution platform, Constellation Affiliated Partners. Moreover, with an aim to augment its point-of-sale (POS) lending business, it has agreed to acquire Service Finance Company for $2 billion. These efforts will further aid fee income growth. However, the low interest-rate environment is expected to continue to hurt margin growth. Mounting expenses (as witnessed in the third quarter as well) remains another major concern.Truist Financial Corporation Price, Consensus and EPS Surprise  Truist Financial Corporation price-consensus-eps-surprise-chart | Truist Financial Corporation QuoteTruist Financial currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Other Major BanksBank of America’s BAC third-quarter 2021 earnings of 85 cents per share beat the Zacks Consensus Estimate of 71 cents. The bottom line compared favorably with 51 cents earned in the prior-year quarter. Results in the quarter included a reserve release of $1.1 billion.Robust advisory business, reserve release and a modest rise in demand for loans drove JPMorgan’s JPM third-quarter 2021 earnings of $3.74 per share. The bottom line outpaced the Zacks Consensus Estimate of $3.00.First Republic Bank FRC delivered an earnings surprise of 4.4% in third-quarter 2021 on solid top-line strength. Earnings per share of $1.91 surpassed the Zacks Consensus Estimate of $1.83. The bottom line improved 18.6% from the year-ago quarter’s figure. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>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 Bank of America Corporation (BAC): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report First Republic Bank (FRC): Free Stock Analysis Report Truist Financial Corporation (TFC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 15th, 2021

Stocks Rally on Strong Earnings and Low Jobless Claims

Stocks Rally on Strong Earnings and Low Jobless Claims The wind was certainly at the market’s back on Thursday as investors enjoyed good news on several fronts, including earnings reports, jobless claims and even inflation. Stocks soared well over 1.5% and are poised for a second straight week of gains. The NASDAQ jumped 1.73% (or about 251 points) to 14,823.43, while the S&P rose 1.71% to 4438.26. Meanwhile, the Dow snapped its four-day losing streak in a big way by soaring 1.56% (or nearly 535 points) to 34,912.56. The market doesn’t always respond positively to solid earnings reports, but today it sure did. Investors are feeling some relief at such strong results in the face of crippling global supply chain issues, rising inflation and other factors that threaten to slow the economic recovery. But on Thursday we were all treated to double-digit earnings surprises from several of the country’s largest financial institutions, including Bank of America (BAC), Wells Fargo (WFC), Morgan Stanley (MS), Citigroup (C) and US Bancorp (USB). And there were plenty positive surprises outside of the big banks, including Taiwan Semiconductor (TSM), UnitedHealth (UNH) and Walgreens Boots Alliance (WBA), among others. In other news on Thursday, jobless claims for last week came in at 293,000, which was much better than expectations of around 320K. It was also the first result below 300K since Covid began, which means we're back at a pandemic-era low for the first time in a month. And we even received some decent inflation data today, as the PPI rose ‘only’ 0.5% in September. That result was better than expectations for a 0.6% advance and an improvement from August’s 0.7% increase. Of course, inflation remains abnormally high any way you look at it, as evidenced by producer prices rising 8.6% year over year. Nevertheless, that’s two “could’ve been worse” inflation reports in as many days, which should keep investors calm while we wait for the Fed’s “transitory” prediction to come through. So what’s in store for tomorrow? More of the same, of course! We’ll be getting a new round of earnings reports and a bit more economic data, including retail sales. The major indices are higher for the week heading into Friday, but more gains would certainly be appreciated… Today's Portfolio Highlights: Home Run Investor: The portfolio is a bit light these days, so Brian added for a second consecutive session on Thursday. He picked up Health Catalyst (HCAT), a provider of data and analytics technology and services to healthcare organizations. This Zacks Rank #2 (Buy) topped the Zacks Consensus Estimate in each of the past four consecutive quarters, but the editor considers the most recent beat to be a “watershed moment”. HCAT broke even in that quarter, which not only beat expectations for a 13-cent loss but could also be signaling a move into profitability. If the company does get to the plus side, then Brian thinks we could see “a dramatic shift in estimates”. And with topline growth expectations of 23.5% for this year and 28.5% for next; HCAT seems ready to move into the black. Read the full write-up for more on today’s addition.   Surprise Trader: Earnings season is heating up with several of the country’s biggest banks already reporting, but Dave is leaving the big city and going out to the farm for today’s addition. The editor added Tractor Supply (TSCO), the well-known retail farm and ranch store chain that has eclipsed the Zacks Consensus Estimate for six straight quarters. In fact, the last four surprises come to an average beat of 22.5%. This Zacks Rank #2 (Buy) has a positive Earnings ESP for its next report that’s scheduled for Thursday, October 21 before the bell. Dave added TSCO today with a 12.5% allocation, while also selling half of Dave & Busters (PLAY) for an 8.3% return in a little more than a month. Read the full write-up for more. Insider Trader: "The data continues to be better than expected so that's lighting a fire under the stock market again. Remember, the market is forward looking. It has already priced in the supply chain issues. "And yes, a lot of companies are going to talk about those issues and inflation in their earnings calls. But the Street knows this and is already thinking its transitory. "The Street is already looking beyond the next few weeks and into next year. 2022 looks better as the supply chain issues work themselves out which should also help with some of the inflationary pressures." -- Tracey Ryniec See You Friday, Jim Giaquinto Recommendations from Zacks' Private Portfolios: Believe it or not, this article is not available on the Zacks.com website. The commentary is a partial overview of the daily activity from Zacks' private recommendation services. If you would like to follow our Buy and Sell signals in real time, we've made a special arrangement for readers of this website. Starting today you can see all the recommendations from all of Zacks' portfolios absolutely free for 7 days. Our services cover everything from value stocks and momentum trades to insider buying and positive earnings surprises (which we've predicted with an astonishing 80%+ accuracy). Click here to "test drive" Zacks Ultimate for FREE >>  Zacks Investment Research.....»»

Category: topSource: zacksOct 15th, 2021

Wells Fargo Tumbles After Another Ugly Quarter: Loans Shrink Again As Home Lending Tumbles

Wells Fargo Tumbles After Another Ugly Quarter: Loans Shrink Again As Home Lending Tumbles In a day when the big banks reported generally stellar earnings (especially Bank of America and Morgan Stanley on the back of record advisory fees), easing the bitter aftertaste from yesterday's disappointing report from JPMorgan, even perennial Wall Street disappointment Wells Fargo managed to beat expectations with net Interest margin posting a much awaited bounce, although there was the usual "but" of higher expenses and failure to post an increase in loan growth.. Wells Fargo reported EPS of $1.17, beating expectations of $0.99, thanks to revenue of $18.83BN, also stronger than the $18.37Bn expected. This translated into income of $5.1 billion, which however was padded by a $1.7 billion reserve release "due to continued improvements in the economic environment", resulting in an allowance coverage for total loans down 22 bps from 2Q21 and down 52 bps from 3Q20.  The firm also took a $250 million charge related to its latest regulatory order, which drove costs higher than analysts expected.   The company's earnings summarized: There was some much awaited good news on the Net Interest front, where both net interest income and margin posted a modest sequential improvement, rising $109MM or 1% from Q1, due to rising yields in Q3. Still, on a Y/Y basis, net interest income decreased $470 million or 5%, "reflecting the impact of lower loan balances due to soft demand and elevated prepayments, and the impact of lower yields on earning assets, partially offset by a decline in long-term debt and lower mortgage-backed securities (MBS) premium amortization."  In any case, since Wells Fargo is the most net interest income-reliant bank in the US, the reversal in NIM was certainly good news. With NIM down Y/Y, expenses followed and the bank reported that noninterest expense (which consists mostly of personnel expenses) was flat sequentially and down 12.6% from a year ago, though analysts had expected a 14% drop. And even though headcount fell to 253,871, from 259,196 at the end of June, personnel expenses actually rose 1% from a year ago "as lower salaries expense driven by reduced headcount reflecting efficiency initiatives was more than offset by higher incentive and revenue-related compensation." But perhaps the most important, and disappointing aspect of Wells' results was that total average loans shrank again, and while commercial loans posted a small increase sequentially of $1.2BN to $478.2BN, Consumer Loans dropped by almost $2BN from $377.7BN to $375.9BN in Q3, and down a whopping $58.1BN from a year ago. The total average loan yield of 3.29%, was down 4 bps from 2Q21 and down 12 bps YoY reflecting the repricing impacts of lower interest rates, as well as lower consumer real estate loans. Meanwhile, as we have been discussing for the past 5 quarters, average deposits - a proxy for the Fed's QE - were up $51.9 billion, or 4%, YoY "as growth across most businesses was partially offset by targeted actions to manage to the asset cap, primarily in Corporate Treasury and Corporate and Investment Banking." The good news it that this remains the cheapest funding possible for Wells - at an average deposit cost of 3 bps, it was stable with 2Q21 and down 6 bps YoY reflecting the lower interest rate environment. The biggest U.S. banks have been struggling with weak loan growth as consumers and businesses, bolstered by massive government stimulus programs during the pandemic, refrained from borrowing. The rise of the delta variant has also delayed a return to normal and slowed economic activity. Average loans fell 8%, Wells Fargo said. There was more bad news in the bank's consumer banking and lending group, where total revenue was down 4% YoY. Some more details: CSBB up 2% YoY primarily due to an increase in consumer activity, including higher debit card transactions, and lower COVID-19-related fee waivers; up 2% from 2Q21 primarily driven by higher deposit-related fees and higher net interest income on higher deposits Credit Card up 4% YoY on higher point-of-sale volume and lower customer accommodations and fee waivers provided in response to COVID-19 Auto up 10% YoY and up 7% from 2Q21 on higher loan balances What was most disappointing was that Home Lending - where Wells Fargo once dominated the market - was down 20% YoY primarily due to lower mortgage banking income on lower gain on sale margins, origination volumes, and servicing fees, as well as lower net interest income on lower loans outstanding. In short, it is the biggest housing bubble in US history - bigger even that 2007- and Wells still can't capitalize on it! Finally, while for Wells, Banking and Sales and Trading are mostly an afterthought - after all, who would pick the trading desk at Wells over, well, anyone else - and the bank is not even close in the same ballpark as its bigger peers, it did post a modest, 2% increase in corporate and ibanking revenue to $3.385 billion, which was also up 1%, or $47MM, from last quarter. Banking revenue was up 12% YoY "on higher advisory and equity origination fees, and higher loan balances, partially offset by lower deposit balances predominantly due to actions taken to manage under the asset cap" Commercial Real Estate revenue up 10% YoY reflecting higher commercial servicing income, loan balances, and capital markets results on stronger commercial mortgage gain on sale volumes and margins and higher underwriting fees; down 7% from 2Q21 on lower capital markets volumes and commercial mortgage servicing income Yet here too there was a disappointment, as markets revenue dropped 15% YoY to just $1.176BN on "lower trading activity across most asset classes primarily due to market conditions" As Bloomberg notes, the mixed results were a reminder that challenges remain for Scharf, who took the helm of Wells Fargo in 2019. The bank has been cutting jobs and slashing costs as Scharf seeks to boost the firm’s profitability after years of scandals, which have continued this year as the bank has seen several settlements with regulators, a sordid legacy of its ugly past. “The significant deficiencies that existed when I arrived must remain our top priority,” Scharf said in the statement. “We are a different company today and the operational and cultural changes we’ve made are enabling us to execute with significantly greater discipline than we have in the past.” Or not: during the quarter, Wells Fargo was hit with a new regulatory action and a $250 million fine over its lack of progress addressing long-standing problems -- a topic that is sure to come up on the bank’s analyst call. The firm is also still under a Federal Reserve-imposed asset cap, which limits its balance sheet. Bottom line: another swing and another miss, with Wells shares the worst performing of all banks this morning. Tyler Durden Thu, 10/14/2021 - 10:19.....»»

Category: blogSource: zerohedgeOct 14th, 2021

Oil-Dri Announces Fourth Quarter and Fiscal 2021 Results

CHICAGO, Oct. 13, 2021 (GLOBE NEWSWIRE) -- Oil-Dri Corporation of America (NYSE:ODC), producer and marketer of sorbent mineral products, today announced results for its fourth quarter and fiscal year 2021.   Fourth Quarter Year to Date (in thousands, except per share amounts) Ended July 31 Ended July 31   2021   2020   Change 2021 2020 Change Consolidated Results             Net Sales $78,129 $64,844   20  % $304,981 $283,227 8  % Net Income Attributable to Oil-Dri $603 $5,886   (90 )% $11,113 $18,900 (41 )% Earnings per Common Diluted Share $0.08 $0.83   (90 )% $1.57 $2.65 (41 )% Business to Business             Net Sales $30,022 $26,628   13  % $110,120 $104,260 6  % Segment Operating Income* $3,791 $6,255   (39 )% $25,086 $26,882 (7 )% Retail and Wholesale             Net Sales $48,107 $38,216   26  % $194,861 $178,967 9  % Segment Operating Income (Loss)* $3,283 ($825 ) 498  % $11,916 $13,079 (9 )% *Segment operating income (loss) for fiscal year 2020 has been adjusted. See Note 1 of the Notes to the Consolidated Financial Statements in our Annual Report on form 10-K for the year ended July 31, 2021. Daniel S. Jaffee, President and Chief Executive Officer, stated, "Our performance in the fourth quarter and fiscal year 2021 was disappointing despite tremendous top-line growth with record high consolidated net sales for both periods. Our profitability was greatly reduced due to significant cost inflation across all input channels. Not only did the price of resin used in our jugs and pails spike, but higher lumber costs for pallets also contributed to the considerable increase in our overall packaging expenses. Dramatic increases in freight, natural gas and other material costs also negatively impacted our margins. In response to these rising costs, we implemented price increases across our product portfolio. However, it is clear we did not keep up with the rapid pace of inflation. Additionally, our supply chain was challenged as a result of trucking and ocean carrier capacity constraints combined with a nationwide labor shortage. Despite these headwinds, we achieved many of our strategic goals and delivered increased dividends to our shareholders during the fiscal year. We continue to push forward with our two biggest growth opportunities: mineral-based antibiotic alternative feed additives and lightweight cat litter. I am excited to report that our animal health products are currently in several trials across the globe. In addition, consumer demand for our lightweight cat litter remains strong, and our branded and private label products continue to surpass category growth. Our new Cat's Pride UltraClean and Cat's Pride Flushable items were recently launched, and we are convinced consumers will enjoy the products' unique benefits. As we begin fiscal year 2022, we will continue to focus on developing our value-added businesses and enhancing profitability." Full Year ResultsConsolidated net sales for fiscal year 2021 reached an all-time record high of $305 million, reflecting an 8% increase over the prior year. This was primarily due to higher demand of our cat litter and agricultural products which increased 9% and 19%, respectively, in fiscal year 2021 compared to the prior year. Revenues from our fluid purification products were 3% greater than last year, while sales of animal health and nutrition products were essentially flat. Industrial and sports business revenues grew 9% year over year, and we experienced steady sales gains of 2% from our co-packaging coarse cat litter business. Annual consolidated gross profit decreased by $3.5 million, as margins were reduced to 21% in fiscal 2021 from 24% in the prior year. Severe inflationary pressures caused domestic cost of goods sold per manufacturing ton to increase approximately 8% in the twelve month period compared to the prior year. Domestic freight, packaging and natural gas per manufactured ton rose 13%, 19%, and 15%, respectively over the prior year. U.S. non-fuel manufacturing costs per ton increased approximately 3%, primarily driven by higher costs of purchased materials. Included in fiscal year 2020's results, was the one-time pre-tax receipt of $13 million in connection with an intellectual property license agreement which occurred in the fourth quarter of the same year. Selling, general and administrative ("SG&A") expenses for fiscal year 2021 decreased 8% from the prior year primarily due to lower advertising spending, estimated annual incentive bonus accrual and pension expense. Fiscal 2020 SG&A expenses included a legal contingency offset by a curtailment gain related to our Supplemental Executive Retirement Plan. In addition, a change in the allocation of expenses from SG&A to cost of goods sold affected quarterly segment operating income in both fiscal years 2021 and 2020 by $5.3 million and $7.1 million, respectively. This reclassification did not affect consolidated operating or net income. Consolidated annual operating income was $13 million, reflecting a 47% decrease from the prior year. Excluding the aforementioned one-time pre-tax receipt of $13 million in fiscal 2020, operating income for fiscal 2021 was 10% greater than last year. Other income (expense), net in fiscal year 2021 included approximately $600,000 of settlement costs under our pension plan, compared to $2 million in fiscal year 2020. Full year net income attributed to Oil-Dri was $11.1 million, reflecting a 41% decrease from the prior year. Cash and Cash Equivalents decreased to $24.6 million in fiscal 2021 from $41 million in fiscal 2020, as a result of higher cost of goods sold and a significant fiscal 2020 bonus payout which was paid in fiscal 2021. Debt decreased to $9 million in fiscal 2021 from $10 million in the prior year. Fourth Quarter ResultsConsolidated net sales in the fourth quarter reached an all-time quarterly high of $78 million, or a 20% increase over the prior year. Sales from our cat litter, industrial and sports, and agricultural businesses drove the majority of this growth. Demand for fluids purification products and co-packaged coarse cat litter also increased in the fourth quarter over the prior year, while revenues from our animal health and nutrition products were essentially flat. Fourth quarter consolidated gross profit decreased by approximately $1.5 million, while margin was reduced to 19% in fiscal 2021 from 21% in fiscal 2020. Although revenues grew significantly in the quarter, these gains were offset by a 7% increase in domestic cost of goods sold per manufactured ton compared to the prior year. Trucking capacity constraints and high fuel costs resulted in a 7% increase in domestic freight per manufactured ton compared to the same period last year. Due to extreme inflation on resin and lumber prices, domestic packaging costs per manufactured ton increased 40%. Further contributing to the reduction in margin was higher domestic natural gas per manufactured ton which increased 67% in the fourth quarter over the prior year. In the fourth quarter of fiscal 2021, consolidated operating income was $1.7 million compared to $9.1 million in fiscal 2020. Revenue increases and a $4 million, or 24%, reduction in SG&A expenses were partially offset by significantly higher cost of goods sold. Also, impacting the quarterly results comparison was the one-time pre-tax receipt of $13 million resulting from an intellectual property license agreement which occurred in the fourth quarter of fiscal 2020. Last year's results included a legal contingency as well as an accrual which was no longer deemed necessary in fiscal year 2021. In addition, a change in the allocation of expenses from SG&A to cost of goods sold affected quarterly segment operating income in both fiscal years 2021 and 2020 by $755,000 and $2.2 million, respectively. This reclassification did not affect consolidated operating or net income. Fourth quarter consolidated net income attributed to Oil-Dri was $603,000 in fiscal 2021 compared to $5.9 million in fiscal 2020. Product Group ReviewThe Business to Business Products ("B2B") Group's fourth quarter revenues reached a record $30 million, a 13% gain over the prior year. This increase was primarily driven by strong revenue growth from the agricultural and fluid purification businesses. Sales of agricultural products increased by 37% over the prior year, as demand from one of our largest customers rose in the quarter. The B2B Products Group also benefited from a 7% increase in revenues within the fluids purification business. Sales of bleaching clay products were strong in North America and Latin America, while softer revenues were experienced in Europe and Asia. COVID-19 continued to limit our ability to conduct and participate in product tests at edible oil plants, thus resulting in lower than expected sales growth. The ongoing pandemic also negatively impacted our jet fuel business in regions such as Europe and Asia where air travel is still at low levels. Our co-packaging coarse cat litter experienced sales gains of 16% in the fourth quarter compared to the prior year, primarily due to increased pricing. Fourth quarter revenues of animal health products remained flat compared to the same period last year. African Swine Fever and the ongoing pandemic created challenges for the global animal protein production market, including feed additives. Despite this, we achieved sales increases of 66% in China during the fourth quarter compared to the prior year, as well as top line growth in Asia, Latin America, and North America. However, these increases were offset by lower revenues in Mexico, as fiscal 2020 included the sale of animal health related equipment that did not recur this year. Operating income for the B2B Products Group was $3.8 million in the fourth quarter of fiscal 2021 compared to $6.3 million in fiscal 2020. The prior year's results reflect the reallocation of $943,000 between SG&A expenses and cost of goods sold. Higher sales were offset by inflationary headwinds and an 11% increase in SG&A expenses over the previous fourth quarter. These elevated SG&A costs were a result of increased compensation and travel expenses, reflecting investments in our animal health business through additional sales personnel and leadership. The Retail and Wholesale ("R&W") Products Group's fourth quarter revenues were $48 million, a 26% increase over the prior year. This was driven by a 25% increase in domestic cat litter sales due to strong demand for our branded and private label products. We exceeded category sales growth of 12.1% for the 12-week period ended July 17, 2021, according to third-party market research data for retail sales1. Demand for our branded and private label lightweight litter products continued to rise as demonstrated by the 43% increase in fourth quarter sales over the prior year. Our e-commerce business experienced double-digit revenue gains for the fourth quarter compared to the same period last year. As more consumers have broadened their online purchases since the onset of the pandemic, e-commerce retailers have increased their Cat's Pride product offerings, including some of our newly launched products. Revenues from our Canadian subsidiary demonstrated strong top line growth due to higher demand of cat litter and industrial absorbent products. Our domestic industrial and sports products business also contributed to the R&W Products Group's revenue improvement in the fourth quarter of fiscal 2021 with sales increasing 36% over the prior year. This gain can be attributed to the return of pre-pandemic industrial product purchasing levels and the reopening of sports fields across the United States. Operating income for the R&W Products Group was $3.3 million in the fourth quarter of fiscal year 2021 compared to ($825,000) in the prior year. Prior year's results reflect the reallocation of $1.3 million between SG&A expenses and cost of goods sold. SG&A expenses for the fourth quarter of fiscal year 2021 declined by 10% from last year. This was primarily due to a reduction in advertising spending as a result of a shift in timing of our marketing campaign from the fourth quarter of fiscal 2021 to fiscal 2022. We expect advertising costs for the upcoming fiscal 2022 to be higher than fiscal 2021. The Company will host its fourth quarter of fiscal 2021 earnings teleconference on Friday, October 15, 2021 at 10:00 a.m. Central Time. Participation details are available on our website's Events page. 1Based in part on data reported by NielsenIQ through its Scantrack Service for the Cat Litter Category in the 12-week period ended July 17, 2021, for the U.S. xAOC+Pet Supers market. Copyright © 2021 Nielsen. Oil-Dri Corporation of America is a leading manufacturer and supplier of specialty sorbent products for the pet care, animal health and nutrition, fluids purification, agricultural ingredients, sports field, industrial and automotive markets. Oil-Dri is vertically integrated which enables the company to efficiently oversee every step of the process from research and development to supply chain to marketing and sales. With 80 years of experience, the company continues to fulfill its mission to Create Value from Sorbent Minerals. "Oil-Dri" and "Cat's Pride" are registered trademarks of Oil-Dri Corporation of America. Certain statements in this press release may contain forward-looking statements that are based on our current expectations, estimates, forecasts and projections about our future performance, our business, our beliefs, and our management's assumptions. In addition, we, or others on our behalf, may make forward-looking statements in other press releases or written statements, or in our communications and discussions with investors and analysts in the normal course of business through meetings, webcasts, phone calls, and conference calls. Words such as "expect," "outlook," "forecast," "would," "could," "should," "project," "intend," "plan," "continue," "believe," "seek," "estimate," "anticipate," "may," "assume," or variations of such words and similar expressions are intended to identify such forward-looking statements, which are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks, uncertainties and assumptions that could cause actual results to differ materially including, but not limited to, the dependence of our future growth and financial performance on successful new product introductions, intense competition in our markets, volatility of our quarterly results, risks associated with acquisitions, our dependence on a limited number of customers for a large portion of our net sales and other risks, uncertainties and assumptions that are described in Item 1A (Risk Factors) of our most recent Annual Report on Form 10-K and other reports we file with the Securities and Exchange Commission. Should one or more of these or other risks or uncertainties materialize, or should underlying assumptions prove incorrect, our actual results may vary materially from those anticipated, intended, expected, believed, estimated, projected or planned. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Except to the extent required by law, we do not have any intention or obligation to update publicly any forward-looking statements after the distribution of this press release, whether as a result of new information, future events, changes in assumptions, or otherwise. Category: Earnings Contact:Leslie A. GarberManager of Investor RelationsOil-Dri Corporation of AmericaInvestorRelations@oildri.com(312) 321-1515 CONSOLIDATED STATEMENTS OF INCOME   (in thousands, except per share amounts)   (unaudited)   Fourth Quarter Ended July 31     2021   % of Sales   2020   % of Sales Net Sales   $ 78,129     100.0  %   $ 64,844     100.0  % Cost of Sales (1)   (63,323 )   (81.0 )%   (51,521 )   (79.5 )% Gross Profit   14,806     19.0  %   13,323     20.5  % Other Operating Income (2) —     —  %   13,000     20.0  % Selling, General and Administrative Expenses (1)(3) (13,122 )   (16.8 )%   (17,190 )   (26.5 )% Operating Income 1,684     2.2  %   9,133     14.1  % Interest Expense (180.....»»

Category: earningsSource: benzingaOct 13th, 2021

Solid Demand Aids Illinois Tool (ITW), Supply Chain & Costs Hurt

Illinois Tool (ITW) is benefiting from healthy end-market demand. Supply-chain restrictions and inflation in prices of raw materials are concerning, and likely to impact margins. Illinois Tool Works Inc. ITW engages in manufacturing engineered products and specialty systems for use in multiple end markets. The Glenview, IL-based company has operations spread globally.The company belongs to the Zacks Manufacturing - General Industrial industry, which, in turn, comes under the ambit of the Zacks Industrial Products sector. The industry is benefiting from the recovery in economic activities and manufacturing operations. However, prevailing headwinds related to supply-chain restrictions and cost-related inflation are concerning for the players.There are a number of factors that are influencing the company’s prospects. A brief discussion on the important factors and the company’s projections is given below:Diversified Operations: The company’s exposure in multiple end markets and geographies raises its attractiveness. Weakness in one or more markets/geographies might be offset by strength in others. Regarding markets, the company’s products are used by customers in food retail, general industrial, construction, consumer durables, restaurants and others.Geographically, the company has a significant presence in the United States, Canada/Mexico, Europe, the Middle East, Africa, the Asia Pacific and South America. Its products are available in more than 52 countries worldwide.Shareholders’ Rewards: Healthy liquidity position equips Illinois Tool to pay dividends and execute share buybacks programs. In the first half of 2021, the company rewarded its shareholders with dividend payments totaling $721 million and share repurchases of $500 million.Notably, the quarterly dividend payout rate was increased by 7% or 8 cents to $1.22 per share in August 2021. A share buyback program worth $3 billion was approved in May. In addition to the May program, the company is left to repurchase $740 million worth of shares from its August 2018 approved share buyback program.Financial Projections: The company anticipates earnings of $8.55-$8.95 per share for 2021, suggesting mid-point growth of 32% from the year-ago reported figure. The projection was announced in July and reflected an increase from $8.20-$8.60 stated earlier.Total revenues in the year are projected to increase 14-16% year over year, with organic sales growth of 11-13%. Earlier, total revenues were guided to grow 12-14%, with an organic sales increase of 10-12%. Enterprise initiatives — including Business Structure Simplification, Portfolio Management and Strategic Sourcing — are likely to contribute 100 basis points (bps) to the operating margin in 2021.Cost Woes: In second-quarter 2021, the company experienced adverse impacts of high raw material costs and restricted supply of components in Automotive OEM. Its costs of sales grew 35.7% year over year, and it recorded a 21% increase in selling, administrative, and research and development expenses.For 2021, the company expects supply-chain and raw material cost headwinds to persist. With effective pricing actions, these woes will have a neutral impact on earnings (on a dollar basis). However, the operating margin will have an adverse impact of 100 bps.Some other players in the industry that have been adversely impacted by the above-mentioned prevailing headwinds are IDEX Corporation IEX, Dover Corporation DOV and Altra Industrial Motion Corp. AIMC.International Operations and High Debts: Though reflective of its growing businesses, international exposure has raised some concerns for Illinois Tools over time. Threats from local competition, unfavorable movements in foreign currencies, and geopolitical issues are expected to impact performances. Macroeconomic challenges might be concerning as well.A highly leveraged balance sheet, with long-term debts of $7,056 million exiting second-quarter 2021, is concerning. Huge debts are unwelcoming as it raises risks of inflation in financial obligations and might hurt profitability. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>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 Illinois Tool Works Inc. (ITW): Free Stock Analysis Report Dover Corporation (DOV): Free Stock Analysis Report IDEX Corporation (IEX): Free Stock Analysis Report Altra Industrial Motion Corp. (AIMC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 13th, 2021

Mondelez (MDLZ) Troubled by Elevated Costs, Acquisitions Aid

Mondelez (MDLZ) is encountering input cost inflation like many other food companies. However, the company's prudent acquisitions have been boosting the top line. Mondelez International, Inc. MDLZ has been keen on expanding its business through acquisitions and alliances. Apart from this, strength in the emerging markets and pricing efforts have been working well for the company, which is battling cost inflation. Mondelez’s gum and candy business is also below the pre-pandemic levels. Let’s delve deeper.Factors Working Well for MondelezTalking of alliances and buyouts, the company recently teamed up with MissFresh to introduce Oreo Zero on the latter’s popular online retail platform. Earlier, it announced a deal to buy Chipita S.A., which is a major producer of sweet and salty snacks in Central and Eastern Europe.  Prior to this, in 2021 itself, Mondelez took over a renowned sports performance and active nutrition brand — Grenade. Further, the company has acquired Australia-based food company — Gourmet Food Holdings — which operates in the premium biscuit and cracker category. Mondelez completed the acquisition of Hu Master Holdings, the parent company of Hu Products on Jan 4. The Hu, Grenade and Gourmet Food buyouts contributed to the company’s top-line growth in the second quarter of 2021. Earlier, the company acquired majority interest in Give & Go (in April 2020), which is a pioneer in fully-finished sweet baked goods.Moving on, Mondelez remains encouraged by the underlying emerging market strength. In second-quarter 2021, revenues from the emerging markets increased 19.6% to $2,293 million, while the same jumped 16.5% on an organic basis. During the quarter, it saw double-digit growth in India, Brazil, Mexico and Russia as well as a high-single-digit improvement in China. The company is focused on boosting its presence in the emerging markets, as evident from the addition of 60,000 and 20,000 respective stores in China and India in the second quarter.Concerning FactorsThe restricted consumer mobility amid the pandemic had dented Mondelez’s gum & candy business. In the second quarter of 2021, however, the category registered robust growth as it saw favorable comparisons with the year-ago period’s major decline. Also, better mobility trends in the quarter aided growth. That said, the gum and candy business declined more than 7% on a two-year basis, reflecting a downside from the pre-pandemic level. While management expects better growth in the second half of 2021, it is still cautious about the dynamics of the gum category. Its guidance for 2021 doesn’t suggest a complete recovery to the pre-pandemic levels.Apart from this, Mondelez’s margins in the second quarter were somewhat affected by the elevated raw-material costs and adverse product mix. Also, increased advertising and consumer promotions spend weighed on the adjusted operating income to an extent. Management envisions the commodity, logistics and labor costs to further flare up in the second half of 2021. While Mondelez is focused on managing these costs, it does anticipate some pressure points during the second half. A number of other food companies, Kellogg K, Conagra Brands CAG and TreeHouse Foods THS, are encountering higher cost challenges.Wrapping UpMondelez has been focused on undertaking saving and robust pricing actions. During second-quarter 2021, the company’s adjusted operating income margin expanded 30 basis points (bps) to 16.2%, courtesy of decreased manufacturing costs, better pricing and reduced overheads. Management, on its second-quarter earnings call, stated that it is focused on revenue growth management capacity, including simplification and pricing initiatives, mainly to combat commodity, logistics and labor cost inflation. However, it remains to be seen if these actions can completely offset the hurdles. Zacks Names "Single Best Pick to Double" From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all. You know this company from its past glory days, but few would expect that it's poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks' Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.Free: See Our Top Stock and 4 Runners Up >>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 Conagra Brands (CAG): Free Stock Analysis Report Kellogg Company (K): Free Stock Analysis Report TreeHouse Foods, Inc. (THS): Free Stock Analysis Report Mondelez International, Inc. (MDLZ): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksOct 13th, 2021

Futures Reverse Losses Ahead Of Key CPI Report

Futures Reverse Losses Ahead Of Key CPI Report For the second day in a row, an overnight slump in equity futures sparked by concerns about iPhone sales (with Bloomberg reporting at the close on Tuesday that iPhone 13 production target may be cut by 10mm units due to chip shortages) and driven be more weakness out of China was rescued thanks to aggressive buying around the European open. At 800 a.m. ET, Dow e-minis were up 35 points, or 0.1%, S&P 500 e-minis were up 10.25 points, or 0.24%, and Nasdaq 100 e-minis were up 58.50 points, or 0.4% ahead of the CPI report due at 830am ET. 10Y yields dipped to 1.566%, the dollar was lower and Brent crude dropped below $83. JPMorgan rose as much as 0.8% in premarket trading after the firm’s merger advisory business reported its best quarterly profit. On the other end, Apple dropped 1% lower in premarket trading, a day after Bloomberg reported that the technology giant is likely to slash its projected iPhone 13 production targets for 2021 by as many as 10 million units due to prolonged chip shortages. Here are some of the biggest U.S. movers today: Suppliers Skyworks Solutions (SWKS US), Qorvo (ORVO) and Cirrus Logic (CRUS US) slipped Tuesday postmarket Koss (KOSS US) shares jump 23% in U.S. premarket trading in an extension of Tuesday’s surge after tech giant Apple was rebuffed in two patent challenges against the headphones and speakers firm Qualcomm (QCOM US) shares were up 2.7% in U.S. premarket trading after it announced a $10.0 billion stock buyback International Paper (IP US) in focus after its board authorized a program to acquire up to $2b of the company’s common stock; cut quarterly dividend by 5c per share Smart Global (SGH US) shares rose 2% Tuesday postmarket after it reported adjusted earnings per share for the fourth quarter that beat the average analyst estimate Wayfair (W US) shares slide 1.8% in thin premarket trading after the stock gets tactical downgrade to hold at Jefferies Plug Power (PLUG US) gains 4.9% in premarket trading after Morgan Stanley upgrades the fuel cell systems company to overweight, saying in note that it’s “particularly well positioned” to be a leader in the hydrogen economy Wall Street ended lower in choppy trading on Tuesday, as investors grew jittery in the run-up to earnings amid worries about supply chain problems and higher prices affecting businesses emerging from the pandemic. As we noted last night, the S&P 500 has gone 27 straight days without rallying to a fresh high, the longest such stretch since last September, signaling some fatigue in the dip-buying that pushed the market up from drops earlier this year. Focus now turn to inflation data, due at 0830 a.m. ET, which will cement the imminent arrival of the Fed's taper.  "A strong inflation will only reinforce the expectation that the Fed would start tapering its bond purchases by next month, that's already priced in," said Ipek Ozkardeskaya, senior analyst at Swissquote Bank. "Yet, a too strong figure could boost expectations of an earlier rate hike from the Fed and that is not necessarily fully priced in." The minutes of the Federal Reserve's September policy meeting, due later in the day, will also be scrutinized for signals that the days of crisis-era policy were numbered. Most European equities reverse small opening losses and were last up about 0.5%, as news that German software giant SAP increased its revenue forecast led tech stocks higher. DAX gained 0.7% with tech, retail and travel names leading. FTSE 100, FTSE MIB and IBEX remained in the red. Here are some of the biggest European movers today: Entra shares gain as much as 10% after Balder increases its stake and says it intends to submit a mandatory offer. Spie jumps as much as 10%, the biggest intraday gain in more than a year, after the French company pulled out of the process to buy Engie’s Equans services unit. Man Group rises as much as 8.3% after the world’s largest publicly traded hedge fund announced quarterly record inflows. 3Q21 net inflows were a “clear beat” and confirm pipeline strength, Morgan Stanley said in a note. Barratt Developments climbs as much as 6.3%, with analysts saying the U.K. homebuilder’s update shows current trading is improving. Recticel climbs 15% to its highest level in more than 20 years as the stock resumes trading after the company announced plans to sell its foams unit to Carpenter Co. Bossard Holding rises as much as 9.1% to a record high after the company reported 3Q earnings that ZKB said show strong growth. Sartorius gains as much as 5.9% after Kepler Cheuvreux upgrades to hold from sell and raises its price target, saying it expects “impressive earnings growth” to continue for the lab equipment company. SAP jumps as much as 5% after the German software giant increased its revenue forecast owing to accelerating cloud sales. Just Eat Takeaway slides as much as 5.8% in Amsterdam to the lowest since March 2020 after a 3Q trading update. Analysts flagged disappointing orders as pandemic restrictions eased, and an underwhelming performance in the online food delivery firm’s U.S. market. Earlier in the session, Asian stocks posted a modest advance as investors awaited key inflation data out of the U.S. and Hong Kong closed its equity market because of typhoon Kompasu. The MSCI Asia Pacific Index rose 0.2% after fluctuating between gains and losses, with chip and electronics manufacturers sliding amid concerns over memory chip supply-chain issues and Apple’s iPhone 13 production targets. Hong Kong’s $6.3 trillion market was shut as strong winds and rain hit the financial hub.  “Broader supply tightness continues to be a real issue across a number of end markets,” Morgan Stanley analysts including Katy L. Huberty wrote in a note. The most significant iPhone production bottleneck stems from a “shortage of camera modules for the iPhone 13 Pro/Pro Max due to low utilization rates at a Sharp factory in southern Vietnam,” they added. Wednesday’s direction-less trading illustrated the uncertainty in Asian markets as traders reassess earnings forecasts to factor in inflation and supply chain concerns. U.S. consumer price index figures and FOMC minutes due overnight may move shares. Southeast Asian indexes rose thanks to their cyclical exposure. Singapore’s stock gauge was the top performer in the region, rising to its highest in about two months, before the the nation’s central bank decides on monetary policy on Thursday. Japanese stocks fell for a second day as electronics makers declined amid worries about memory chip supply-chain issues and concerns over Apple’s iPhone 13 production targets.  The Topix index fell 0.4% to 1,973.83 at the 3 p.m. close in Tokyo, while the Nikkei 225 declined 0.3% to 28,140.28. Toyota Motor Corp. contributed the most to the Topix’s loss, decreasing 1.3%. Out of 2,181 shares in the index, 608 rose and 1,489 fell, while 84 were unchanged. Japanese Apple suppliers such as TDK, Murata and Taiyo Yuden slid. The U.S. company is likely to slash its projected iPhone 13 production targets for 2021 by as many as 10 million units as prolonged chip shortages hit its flagship product, according to people with knowledge of the matter Australian stocks closed lower as banks and miners weighed on the index. The S&P/ASX 200 index fell 0.1% to close at 7,272.50, dragged down by banks and miners as iron ore extended its decline. All other subgauges edged higher. a2 Milk surged after its peer Bubs Australia reported growing China sales and pointed to a better outlook for daigou channels. Bank of Queensland tumbled after its earnings release. In New Zealand, the S&P/NZX 50 index rose 0.2% to 13,025.18. In rates, Treasuries extended Tuesday’s bull-flattening gains, led by gilts and, to a lesser extent, bunds. Treasuries were richer by ~2bps across the long-end of the curve, flattening 5s30s by about that much; U.K. 30-year yield is down nearly 7bp, with same curve flatter by ~6bp. Long-end gilts outperform in a broad-based bull flattening move that pushed 30y gilt yields down ~7bps back near 1.38%. Peripheral spreads widen slightly to Germany. Cash USTs bull flatten but trade cheaper by ~2bps across the back end to both bunds and gilt ahead of today’s CPI release. In FX, the Bloomberg Dollar Spot Index fell by as much as 0.2% and the greenback weakened against all of its Group-of-10 peers; the Treasury curve flattened, mainly via falling yields in the long- end, The euro advanced to trade at around $1.1550 and the Bund yield curve flattened, with German bonds outperforming Treasuries. The euro’s volatility skew versus the dollar shows investors remain bearish the common currency as policy divergence between the Federal Reserve and the European Central Bank remains for now. The pound advanced with traders shrugging off the U.K.’s weaker-than-expected economic growth performance in August. Australia’s sovereign yield curve flattened for a second day while the currency underperformed its New Zealand peer amid a drop in iron ore prices. The yen steadied after four days of declines. In commodities, crude futures hold a narrow range with WTI near $80, Brent dipping slightly below $83. Spot gold pops back toward Tuesday’s best levels near $1,770/oz. Base metals are in the green with most of the complex up at least 1%. To the day ahead now, and the main data highlight will be the aforementioned US CPI reading for September, while today will also see the most recent FOMC meeting minutes released. Other data releases include UK GDP for August and Euro Area industrial production for August. Central bank speakers include BoE Deputy Governor Cunliffe, the ECB’s Visco and the Fed’s Brainard. Finally, earnings releases include JPMorgan Chase, BlackRock and Delta Air Lines. Market Snapshot S&P 500 futures up 0.1% to 4,346.25 STOXX Europe 600 up 0.4% to 459.04 MXAP up 0.2% to 194.60 MXAPJ up 0.4% to 638.16 Nikkei down 0.3% to 28,140.28 Topix down 0.4% to 1,973.83 Hang Seng Index down 1.4% to 24,962.59 Shanghai Composite up 0.4% to 3,561.76 Sensex up 0.8% to 60,782.71 Australia S&P/ASX 200 down 0.1% to 7,272.54 Kospi up 1.0% to 2,944.41 Brent Futures down 0.4% to $83.12/bbl Gold spot up 0.5% to $1,768.13 U.S. Dollar Index down 0.23% to 94.30 German 10Y yield fell 4.2 bps to -0.127% Euro little changed at $1.1553 Brent Futures down 0.4% to $83.12/bbl Top Overnight News from Bloomberg Vladimir Putin wants to press the EU to rewrite some of the rules of its gas market after years of ignoring Moscow’s concerns, to tilt them away from spot-pricing toward long-term contracts favored by Russia’s state run Gazprom, according to two people with knowledge of the matter. Russia is also seeking rapid certification of the controversial Nord Stream 2 pipeline to Germany to boost gas deliveries, they said. Federal Reserve Vice Chairman for Supervision Randal Quarles will be removed from his role as the main watchdog of Wall Street lenders after his title officially expires this week. The EU will offer a new package of concessions to the U.K. that would ease trade barriers in Northern Ireland, as the two sides prepare for a new round of contentious Brexit negotiations. U.K. Chancellor of the Exchequer Rishi Sunak is on course to raise taxes and cut spending to control the budget deficit, while BoE Governor Andrew Bailey has warned interest rates are likely to rise in the coming months to curb a rapid surge in prices. Together, those moves would mark a simultaneous major tightening of both policy levers just months after the biggest recession in a century -- an unprecedented move since the BoE gained independence in 1997. Peter Kazimir, a member of the ECB’s Governing Council, was charged with bribery in Slovakia. Kazimir, who heads the country’s central bank, rejected the allegations A more detailed look at global markets courtesy of Newsquawk Asia-Pac stocks were mixed following the choppy performance stateside with global risk appetite cautious amid the rate hike bets in US and heading into key events including US CPI and FOMC Minutes, while there were also mild headwinds for US equity futures after the closing bell on reports that Apple is set to reduce output of iPhones by 10mln from what was initially planned amid the chip shortage. ASX 200 (unch.) was little changed as gains in gold miners, energy and tech were offset by losses in financials and the broader mining sector, with softer Westpac Consumer Confidence also limiting upside in the index. Nikkei 225 (-0.3%) was pressured at the open as participants digested mixed Machinery Orders data which showed the largest M/M contraction since February 2018 and prompted the government to cut its assessment on machinery orders, although the benchmark index gradually retraced most its losses after finding support around the 28k level and amid the recent favourable currency moves. Shanghai Comp. (+0.4%) also declined as participants digested mixed Chinese trade data in which exports topped estimates but imports disappointed and with Hong Kong markets kept shut due to a typhoon warning. Finally, 10yr JGBs were steady with price action contained after the curve flattening stateside and tentative mood heading to upcoming risk events, although prices were kept afloat amid the BoJ’s purchases in the market for around JPY 1tln of JGBs predominantly focused on 1-3yr and 5-10yr maturities. Top Asian News Gold Edges Higher on Weaker Dollar Before U.S. Inflation Report RBA Rate Hike Expectations Too Aggressive, TD Ameritrade Says LG Electronics Has Series of Stock-Target Cuts After Profit Miss The mood across European stocks has improved from the subdued cash open (Euro Stoxx 50 +0.5%; Stoxx 600 +0.3%) despite a distinct lack of newsflow and heading into the official start of US earnings season, US CPI and FOMC minutes. US equity futures have also nursed earlier losses and trade in modest positive territory across the board, with the NQ (+0.5%) narrowly outperforming owing to the intraday fall in yields, alongside the sectorial outperformance seen in European tech amid tech giant SAP (+4.7%) upgrading its full FY outlook, reflecting the strong business performance which is expected to continue to accelerate cloud revenue growth. As such, the DAX 40 (+0.7%) outperformed since the cash open, whilst the FTSE 100 (-0.2%) is weighed on by underperformance in its heavyweight Banking and Basic Resources sectors amid a decline in yields and hefty losses in iron ore prices. Elsewhere, the CAC 40 (+0.3%) is buoyed by LMVH (+2.0%) after the luxury name topped revenue forecasts and subsequently lifted the Retail sector in tandem. Overall, sectors are mixed with no clear bias. In terms of individual movers, Volkswagen (+3.5%) was bolstered amid Handelsblatt reports in which the Co was said to be cutting some 30k jobs as costs are too high vs competitors, whilst separate sources suggested the automaker is said to be mulling spinning off its Battery Cell and charging unit. Chipmakers meanwhile see mixed fortunes in the aftermath of sources which suggested Apple (-0.7% pre-market) is said to be slashing output amid the chip crunch. Top European News The Hut Shares Swing as Strategy Day Feeds Investor Concern U.K. Economy Grows Less Than Expected as Services Disappoint Man Group Gets $5.3 Billion to Lift Assets to Another Record Jeff Ubben and Singapore’s GIC Back $830 Million Fertiglobe IPO In FX, the Dollar looks somewhat deflated or jaded after yesterday’s exertions when it carved out several fresh 2021 highs against rival currencies and a new record peak vs the increasingly beleaguered Turkish Lira. In index terms, a bout of profit taking, consolidation and position paring seems to have prompted a pull-back from 94.563 into a marginally lower 94.533-246 range awaiting potentially pivotal US inflation data, more Fed rhetoric and FOMC minutes from the last policy meeting that may provide more clues or clarity about prospects for near term tapering. NZD/GBP - Both taking advantage of the Greenback’s aforementioned loss of momentum, but also deriving impetus from favourable crosswinds closer to home as the Kiwi briefly revisited 0.6950+ terrain and Aud/Nzd retreats quite sharply from 1.0600+, while Cable has rebounded through 1.3600 again as Eur/Gbp retests support south of 0.8480 yet again, or 1.1800 as a reciprocal. From a fundamental perspective, Nzd/Usd may also be gleaning leverage from the more forward-looking Activity Outlook component of ANZ’s preliminary business survey for October rather than a decline in sentiment, and Sterling could be content with reported concessions from the EU on NI customs in an effort to resolve the Protocol impasse. EUR/CAD/AUD/CHF - Also reclaiming some lost ground against the Buck, with the Euro rebounding from around 1.1525 to circa 1.1560, though not technically stable until closer to 1.1600 having faded ahead of the round number on several occasions in the last week. Meanwhile, the Loonie is straddling 1.2450 in keeping with WTI crude on the Usd 80/brl handle, the Aussie is pivoting 0.7350, but capped in wake of a dip in Westpac consumer confidence, and the Franc is rotating either side of 0.9300. JPY - The Yen seems rather reluctant to get too carried away by the Dollar’s demise or join the broad retracement given so many false dawns of late before further depreciation and a continuation of its losing streak. Indeed, the latest recovery has stalled around 113.35 and Usd/Jpy appears firmly underpinned following significantly weaker than expected Japanese m/m machinery orders overnight. SCANDI/EM - Not much upside in the Sek via firmer Swedish money market inflation expectations and perhaps due to the fact that actual CPI data preceded the latest survey and topped consensus, but the Cnh and Cny are firmer on the back of China’s much wider than forecast trade surplus that was bloated by exports exceeding estimates by some distance in contrast to imports. Elsewhere, further hawkish guidance for the Czk as CNB’s Benda contends that high inflation warrants relatively rapid tightening, but the Try has not derived a lot of support from reports that Turkey is in talks to secure extra gas supplies to meet demand this winter, according to a Minister, and perhaps due to more sabre-rattling from the Foreign Ministry over Syria with accusations aimed at the US and Russia. In commodities, WTI and Brent front-month futures see another choppy session within recent and elevated levels – with the former around USD 80.50/bbl (80.79-79.87/bbl) and the latter around 83.35/bbl (83.50-82.65/bbl range). The complex saw some downside in conjunction with jawboning from the Iraqi Energy Minster, who state oil price is unlikely to increase further, whilst at the same time, the Gazprom CEO suggested that the oil market is overheated. Nonetheless, prices saw a rebound from those lows heading into the US inflation figure, whilst the OPEC MOMR is scheduled for 12:00BST/07:00EDT. Although the release will not likely sway prices amidst the myriad of risk events on the docket, it will offer a peek into OPEC's current thinking on the market. As a reminder, the weekly Private Inventory report will be released tonight, with the DoE's slated for tomorrow on account of Monday's Columbus Day holiday. Gas prices, meanwhile, are relatively stable. Russia's Kremlin noted gas supplies have increased to their maximum possible levels, whilst Gazprom is sticking to its contractual obligations, and there can be no gas supplies beyond those obligations. Over to metals, spot gold and silver move in tandem with the receding Buck, with spot gold inching closer towards its 50 DMA at 1,776/oz (vs low 1,759.50/oz). In terms of base metals, LME copper has regained a footing above USD 9,500/t as stocks grind higher. Conversely, iron ore and rebar futures overnight fell some 6%, with overnight headlines suggesting that China has required steel mills to cut winter output. Further from the supply side, Nyrstar is to limit European smelter output by up to 50% due to energy costs. Nyrstar has a market-leading position in zinc and lead. LME zinc hit the highest levels since March 2018 following the headlines US Event Calendar 8:30am: Sept. CPI YoY, est. 5.3%, prior 5.3%; MoM, est. 0.3%, prior 0.3% 8:30am: Sept. CPI Ex Food and Energy YoY, est. 4.0%, prior 4.0%; MoM, est. 0.2%, prior 0.1% 8:30am: Sept. Real Avg Weekly Earnings YoY, prior -0.9%, revised -1.4% 2pm: Sept. FOMC Meeting Minutes DB's Jim Reid concludes the overnight wrap So tonight it’s my first ever “live” parents evening and then James Bond via Wagamama. Given my daughter (6) is the eldest in her year and the twins (4) the youngest (plus additional youth for being premature), I’m expecting my daughter to be at least above average but for my boys to only just about be vaguely aware of what’s going on around them. Poor things. For those reading yesterday, the Cameo video of Nadia Comanenci went down a storm, especially when she mentioned our kids’ names, but the fact that there was no birthday cake wasn’t as popular. So I played a very complicated, defence splitting 80 yard through ball but missed an open goal. Anyway ahead of Bond tonight, with all this inflation about I’m half expecting him to be known as 008 going forward. The next installment of the US prices saga will be seen today with US CPI at 13:30 London time. This is an important one, since it’s the last CPI number the Fed will have ahead of their next policy decision just 3 weeks from now, where investors are awaiting a potential announcement on tapering asset purchases. Interestingly the August reading last month was the first time so far this year that the month-on-month measure was actually beneath the consensus expectation on Bloomberg, with the +0.3% growth being the slowest since January. Famous last words but this report might not be the most interesting since it may be a bit backward looking given WTI oil is up c.7.5% in October alone. In addition, used cars were up +5.4% in September after falling in late summer. So given the 2-3 month lag for this to filter through into the CPI we won’t be getting the full picture today. I loved the fact from his speech last night that the Fed’s Bostic has introduced a “transitory” swear jar in his office. More on the Fedspeak later. In terms of what to expect this time around though, our US economists are forecasting month-on-month growth of +0.41% in the headline CPI, and +0.27% for core, which would take the year-on-year rates to +5.4% for headline and +4.1% for core. Ahead of this, inflation expectations softened late in the day as Fed officials were on the hawkish side. The US 10yr breakeven dropped -1.9bps to 2.49% after trading at 2.527% earlier in the session. This is still the 3rd highest closing level since May, and remains only 7bps off its post-2013 closing high. Earlier, inflation expectations continued to climb in Europe, where the 5y5y forward inflation swap hit a post-2015 high of 1.84%. Also on inflation, the New York Fed released their latest Survey of Consumer Expectations later in the European session, which showed that 1-year ahead inflation expectations were now at +5.3%, which is the highest level since the survey began in 2013, whilst 3-year ahead expectations were now at +4.2%, which was also a high for the series. The late rally in US breakevens, coupled with lower real yields (-1.6bps) meant that the 10yr Treasury yield ended the session down -3.5bps at 1.577% - their biggest one day drop in just over 3 weeks. There was a decent flattening of the yield curve, with the 2yr yield up +2.0bps to 0.34%, its highest level since the pandemic began as the market priced in more near-term Fed rate hikes. In the Euro Area it was a very different story however, with 10yr yields rising to their highest level in months, including among bunds (+3.5bps), OATs (+2.9bps) and BTPs (+1.0bps). That rise in the 10yr bund yield left it at -0.09%, taking it above its recent peak earlier this year to its highest closing level since May 2019. Interestingly gilts (-4.0bps) massively out-performed after having aggressively sold off for the last week or so. Against this backdrop, equity markets struggled for direction as they awaited the CPI reading and the start of the US Q3 earnings season today. By the close of trade, the S&P 500 (-0.24%) and the STOXX 600 (-0.07%) had both posted modest losses as they awaited the next catalyst. Defensive sectors were the outperformers on both sides of the Atlantic. Real estate (+1.34%) and utilities (+0.67%) were among the best performing US stocks, though some notable “reopening” industries outperformed as well including airlines (+0.83%), hotels & leisure (+0.51%). News came out after the US close regarding the global chip shortage, with Bloomberg reporting that Apple, who are one of the largest buyers of chips, would revise down their iPhone 13 production targets for 2021 by 10 million units. Recent rumblings from chip producers suggest that the problems are expected to persist, which will make central bank decisions even more complicated over the coming weeks as they grapple with increasing supply-side constraints that push up inflation whilst threatening to undermine the recovery. Speaking of central bankers, Vice Chair Clarida echoed his previous remarks and other communications from the so-called “core” of the FOMC that the current bout of inflation would prove largely transitory and that underlying trend inflation was hovering close to 2%, while admitting that risks were tilted towards higher inflation. Atlanta Fed President Bostic took a much harder line though, noting that price pressures were expanding beyond the pandemic-impacted sectors, and measures of inflation expectations were creeping higher. Specifically, he said, “it is becoming increasingly clear that the feature of this episode that has animated price pressures — mainly the intense and widespread supply-chain disruptions — will not be brief.” His ‘transitory swear word jar’ for his office was considerably more full by the end of his speech. As highlighted above, while President Bostic spoke US 10yr breakevens dropped -2bps and then continued declining through the New York afternoon. In what is likely to be Clarida’s last consequential decision on monetary policy before his term expires, he noted it may soon be time to start a tapering program that ends in the middle of next year, in line with our US economics team’s call for a November taper announcement. In that vein, our US economists have updated their forecasts for rate hikes yesterday, and now see liftoff taking place in December 2022, followed by 3 rate increases in each of 2023 and 2024. That comes in light of supply disruptions lifting inflation, a likely rise in inflation expectations (which are sensitive to oil prices), and measures of labour market slack continuing to outperform. For those interested, you can read a more in-depth discussion of this here. Turning to commodities, yesterday saw a stabilisation in prices after the rapid gains on Monday, with WTI (+0.15%) and Brent Crude (-0.27%) oil prices seeing only modest movements either way, whilst iron ore prices in Singapore were down -3.45%. That said it wasn’t entirely bad news for the asset class, with Chinese coal futures (+4.45%) hitting fresh records, just as aluminium prices on the London Metal Exchange (+0.13%) eked out another gain to hit a new post-2008 high. Overnight in Asia, equity markets are seeing a mixed performance with the KOSPI (+1.24%) posting decent gains, whereas the CSI (-0.06%), Nikkei (-0.22%) and Shanghai Composite (-0.69%) have all lost ground. The KOSPI’s strength came about on the back of a decent jobs report, with South Korea adding +671k relative to a year earlier, the most since March 2014. The Hong Kong Exchange is closed however due to the impact of typhoon Kompasu. Separately, coal futures in China are up another +8.00% this morning, so no sign of those price pressures abating just yet following recent floods. Meanwhile, US equity futures are pointing to little change later on, with those on the S&P 500 down -0.12%. Here in Europe, we had some fresh Brexit headlines after the UK’s Brexit minister, David Frost, said that the Northern Ireland Protocol “is not working” and was not protecting the Good Friday Agreement. He said that he was sharing a new amended Protocol with the EU, which comes ahead of the release of the EU’s own proposals on the issue today. But Frost also said that “if we are going to get a solution we must, collectively, deliver significant change”, and that Article 16 which allows either side to take unilateral safeguard measures could be used “if necessary”. Elsewhere yesterday, the IMF marginally downgraded their global growth forecast for this year, now seeing +5.9% growth in 2021 (vs. +6.0% in July), whilst their 2022 forecast was maintained at +4.9%. This masked some serious differences between countries however, with the US downgraded to +6.0% in 2021 (vs. +7.0% in July), whereas Italy’s was upgraded to +5.8% (vs. +4.9% in July). On inflation they said that risks were skewed to the upside, and upgraded their forecasts for the advanced economies to +2.8% in 2021, and to +2.3% in 2022. Looking at yesterday’s data, US job openings declined in August for the first time this year, falling to 10.439m (vs. 10.954m expected). But the quits rate hit a record of 2.9%, well above its pre-Covid levels of 2.3-2.4%. Here in the UK, data showed the number of payroll employees rose by +207k in September, while the unemployment rate for the three months to August fell to 4.5%, in line with expectations. And in a further sign of supply-side issues, the number of job vacancies in the three months to September hit a record high of 1.102m. Separately in Germany, the ZEW survey results came in beneath expectations, with the current situation declining to 21.6 (vs. 28.0 expected), whilst expectations fell to 22.3 (vs. 23.5 expected), its lowest level since March 2020. To the day ahead now, and the main data highlight will be the aforementioned US CPI reading for September, while today will also see the most recent FOMC meeting minutes released. Other data releases include UK GDP for August and Euro Area industrial production for August. Central bank speakers include BoE Deputy Governor Cunliffe, the ECB’s Visco and the Fed’s Brainard. Finally, earnings releases include JPMorgan Chase, BlackRock and Delta Air Lines. Tyler Durden Wed, 10/13/2021 - 08:13.....»»

Category: blogSource: zerohedgeOct 13th, 2021

Markets Still Seeking Equilibrium

Markets fought bravely into the green following a soft open to start a new trading week, only to slide to session lows right at the close. Markets fought bravely into the green following a soft open to start a new trading week, only to slide back into the red midday, then slide to session lows right at the close of regular trading. The Dow dropped -245 points, -0.72%, and trades beneath 34,500 once again. The S&P 500 was down -0.69%, -30 points, while the tech-heavy Nasdaq went -0.64% on the day. The small-cap Russell 2000 fell -0.56%.Materials and Real Estate led industries, while Communication Services and Utilities were down. Oil prices spiked, with the West Texas Intermediate (WTI) spot price reaching its highest level in seven years. The 10-year bond sticks at 1.6%; bond markets were closed Monday to honor Indigenous Peoples and Christopher Columbus, and will open for trading once again Tuesday morning.Further analysis of the U.S. labor market took hold upon discussions of Southwest Airlines LUV difficulties over the weekend, where the major airline carrier cancelled some 2000 flights since Saturday. Aside from weather issues, the company cited a “worker shortage;” some analysts are interpreting this as an internal battle between the front office and labor. Shares of the stock tumbled -4.2% by Monday’s close.There are reportedly 11 million open jobs in the U.S. right now — many of which offer relatively low pay in “people-facing” service industries, where issues like Covid infection remain high on workers’ lists of concerns. Of the 3.1 million fewer people in the workforce from February 2020 — the last month prior to the pandemic shutdown — 2 million of these are women. New retiree numbers have surged since the pandemic began, and a dearth of immigrants for the past five years have put a damper on that job growth.Markets appear to continue seeking some sort of equilibrium, but now seem to be taking a downward bias as opposed to last week, which was more positive. Perhaps news of progress in the passage of one or both infrastructure bills into law might salve market irritation. Relying on the Fed to announce the start of its asset tapering will likely have to wait another four weeks: the next two-day Federal Open Market Committee (FOMC) meeting is not until November 2nd-3rd.In the meantime, Q3 earnings reports are on deck for finished goods supplier Fastenal FAST Tuesday and JPMorgan JPM and Delta Air Lines DAL Wednesday. Once the first wave of reports have filtered through, we’ll have a better idea of how the quarter — and projections for the full year — are transpiring. Currently, with only a smattering of Q3 earnings data, results are thus far slightly underwhelming.Questions or comments about this article and/or its author? Click here>> Tech IPOs With Massive Profit Potential In the past few years, many popular platforms and like Uber and Airbnb finally made their way to the public markets. But the biggest paydays came from lesser-known names. For example, electric carmaker X Peng shot up +299.4% in just 2 months. Think of it this way… If you had put $5,000 into XPEV at its IPO in September 2020, you could have cashed out with $19,970 in November. With record amounts of cash flooding into IPOs and a record-setting stock market, this year’s lineup 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 JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Delta Air Lines, Inc. (DAL): Free Stock Analysis Report Southwest Airlines Co. (LUV): Free Stock Analysis Report Fastenal Company (FAST): Free Stock Analysis Report SPDR S&P 500 ETF (SPY): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research 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.....»»

Category: topSource: zacksOct 12th, 2021

Markets Up 3rd Day in a Row

The Dow gained +0.98%, +337 points (it was +558 points at its high), while the S&P 500 was +0.83% to close a hair beneath 4400, and the Nasdaq grew 152 points, or +1.05%. Markets performed well again today — the third-straight up day for the Dow, S&P 500 and Nasdaq since Monday’s deep sell-off — though closed off the session highs. The Dow gained +0.98%, +337 points (it was +558 points at its high), while the S&P 500 was +0.83% to close a hair beneath 4400, and the Nasdaq grew 152 points, or +1.05%. The small-cap Russell 2000 beat the field, garnering +1.59% in regular trading.The Dow is now within 2% of its all-time highs, not seen since mid-August. The early days of September brought the latest all-time highs in the S&P, which is now 3% off those highs. The Nasdaq, which took the biggest hit during the most-recent sell-off, is now within 5% of its all-time highs set September 7th. The S&P leads the major indexes year to date, +19%, followed by the Nasdaq and then the Dow, both around +15%.New Consumer Credit numbers for August were released earlier this afternoon, with results notably below expectations: $14.4 billion is a big step down from the upwardly revised $17.3 billion we saw for July — and another world removed from June’s whopping $38.2 billion. This amounts to a 4% increase month over month — the slowest since January — due partially to a slowdown in auto sales. (Although we saw good September sales numbers for General Motors GM and Ford F earlier today.)Market participants may have been keeping some powder dry today, however, ahead of tomorrow’s big Employment Situation report from the U.S. Bureau of Labor Statistics (BLS). Recall a month ago when August jobs numbers came in drastically light of estimates. For tomorrow, an even 500K new jobs were expected to have been created last month. The Unemployment Rate is expected to tick down to a fresh post-Covid low 5.1%. But the proof will be in the pudding.So we’ve now had the 5% sell-off, we’ve fought through what looks to be the biggest challenges of the Covid-19 pandemic, we see the Fed taking its time tapering asset purchases but finally facing that direction. What besides a new jobs report is there to focus on? Earnings. Although we’ve seen results already this cycle from companies like FedEx FDX and Nike NKE, late next week brings us the big banks like JPMorgan JPM.Supply chain issues will be key this earnings season, likely as much so as low base comparisons to a year ago were for the fantastic Q2. Thus, we expect peak earnings to be in our rearview mirror at this point; that said, positive earnings surprises (which we have not seen so far from FedEx or Nike) could bolster markets through the end of the year. Supply chains have already been at least partly priced-into valuations.Questions or comments about this article and/or its author? Click here>> Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough 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 JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Ford Motor Company (F): Free Stock Analysis Report NIKE, Inc. (NKE): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report FedEx Corporation (FDX): Free Stock Analysis Report SPDR S&P 500 ETF (SPY): ETF Research Reports SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports To read this article on Zacks.com click here. Zacks Investment Research 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.....»»

Category: topSource: zacksOct 8th, 2021

Bank Stock Roundup: Expansion Plans of RF, USB, BK & Dividend Hike of OZK in Focus

Business expansion initiatives, steepening of the yield curve, and solid economic growth will keep aiding major banks. So, banks like Regions (RF), U.S. Bancorp (USB), BNY Mello (BK), and Bank OZK (OZK) will gain from such favorable developments. Over the past five trading sessions, the performance of major bank stocks depicted an optimistic stance. The continued market optimism on the back of the Federal Reserve’s slightly hawkish stance on monetary policy is driving the bank stocks.Thus, yields on both 10-year and 30-year Treasury bonds have risen over the past week despite concerns related to the debt ceiling and continued inflationary pressure. The rate on the 10-year Treasury bond stands at 1.58% while that for the 30-year Treasury bond is 2.14%.The steepening yield curve, as well as the expectation of solid economic growth, will benefit major banks’ net interest margins amid a low interest rate environment. This, in turn, will support major banks’ top-line growth. With banks’ financials directly tied to the health of the economy, investors are now expecting improved profitability for major banks in the quarters ahead.Now talking about bank-specific developments, the key theme during the past five trading sessions was business expansion efforts. As major banks face revenue growth challenges, they are constantly undertaking measures to further diversify operations and fuel top-line growth. Image Source: Zacks Investment Research(Read: Bank Stock Roundup for the Week Ending Sep 24, 2021) Important Developments of the Week1. Regions Financial RF is on an expansion spree. The company’s subsidiary, Regions Bank, completed the deal (announced in June) to acquire the specialized home improvement lender, EnerBank USA, from CMS Energy Corporation. Estimated transaction proceeds (including customary adjustments at closing) for CMS Energy are $1 billion.   Additionally, Regions Financial’s subsidiary, Regions Bank, has inked a transaction to acquire Sabal Capital Partners, LLC, a diversified financial services firm leveraging tech-driven origination and servicing platform for the small-balance commercial real estate market. While the financial terms of the transaction, expected to close in the fourth quarter of 2021, have not been disclosed, the acquisition of Sabal is likely to expand Regions’ real estate solutions across the full gamut of agency offerings.2. U.S. Bancorp’s USB primary subsidiary, U.S. Bank, which is foraying into the cryptocurrency arena, is garnering custody access to its Global Fund Services clients. It has launched a cryptocurrency custody service for institutional investment managers having private funds in the Cayman Islands and the United States, who would fancy a safe solution for their Bitcoins.3. BNY Mellon BK is strengthening its transactional & custody foreign exchange (FX) offerings. Effective immediately, the company is adding new trading capabilities, which will turn it into “a transparent open architecture that can be leveraged by a variety of client types for their rules-based, end-to-end transaction needs.”Driven by the changes, the clients in the company’s FX trading programs will now be able to personalize how they trade currencies through it. This will lead to more transparency and provide increased flexibility for participants.Through the enhancement of FX offerings, clients will be able to “design elements of their standing orders.” This will also help in portfolio customization as well as upgrade “trade micro-timestamping facilitates” and offer more clarity as to how the instructions are being executed.BNY Mellon’s new offerings will help upgrade Asia’s capabilities. Specifically, it will enhance offering across the APAC markets and at the same time broaden the client coverage team across the region.This new development will complement BNY Mellon’s launch of an API FX solution in July last year, which lowered “confirmation times for restricted emerging market currencies from hours to seconds.” Also, the company’s expanded FX capabilities in Singapore, which started in June 2020, will capitalize on these new offerings.4. Bank OZK OZK has yet again announced a dividend hike. The company declared a quarterly cash dividend of 29 cents per share, reflecting a rise of 1.8% from the prior payout. This marks the 45th consecutive quarter of dividend hike by the company.Price PerformanceHere is how the seven major stocks performed: Image Source: Zacks Investment ResearchOver the past five trading days, both JPMorgan and Bank of America recorded maximum gains, with their shares rallying 2.4% each. Also, shares of both U.S. Bancorp and PNC Financial have gained 1.8% during the same period.Over the past six months, shares of Capital One and Wells Fargo have jumped 27.5% and 20.2%, respectively, while PNC Financial has gained 14.7%.What’s Next?Over the next five trading days, third-quarter earnings for banks will begin in full swing. Like always, the Wall Street giant JPMorgan will kick start the banking earnings season, reporting on Oct 13. Other big names – Bank of America, Citigroup, and PNC Financial – are scheduled to announce quarterly numbers on Oct 14. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>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 Regions Financial Corporation (RF): Free Stock Analysis Report The Bank of New York Mellon Corporation (BK): Free Stock Analysis Report U.S. Bancorp (USB): Free Stock Analysis Report Bank OZK (OZK): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 8th, 2021

Zebra (ZBRA) Buys antuit.ai, Enhances Retail Software Portfolio

Zebra's (ZBRA) acquisition of antuit.ai will boost its advanced analytics, AI, and automation solution offerings for the consumer products industries. Zebra Technologies Corporation ZBRA yesterday announced that it has closed the acquisition of antuit.ai. The buyout, which was announced in August 2021, was funded through cash.Zebra’s shares declined 0.4% yesterday to eventually close the trading session at $504.41.Headquartered in Dallas, TX, antuit.ai belongs to a consortium managed by Goldman Sachs Asset Management. The company offers artificial intelligence (AI)-driven Software-as-a-Service (SaaS) solutions for retail and consumer packaged goods industries. Its solutions facilitate consumer product companies in executing various business processes like demand forecasting, optimizing inventory allocation, and order delivery procedures as well as formulating prices and promotion.Inside the HeadlinesZebra’s acquisition of antuit.ai will complement its Enterprise Asset Intelligence offerings that empower users with operational visibility and provide important business, market, and customer insights. The addition of antuit.ai’s proficiency in the demand forecasting space will enable Zebra to combine it with its SaaS portfolio to provide advanced analytics, AI, and automation solutions for its customers. This will facilitate them in effective planning and executing business process with better insights into the supply chain, thus enhancing their margins and profitability.With the acquisition, Zebra will enhance the planning and demand forecasting module for its retail software portfolio that includes Workforce Connect and SmartCount solutions. The company expects this buyout, together with the launch of its fixed industrial scanning and machine vision portfolio, to strengthen its position in the consumer products industries.Other Notable BuyoutsIn August 2021, Zebra completed the Fetch Robotics, Inc. buyout for $290 million, which is likely to boost its position as a provider of comprehensive line of advanced robotics solutions. Also, in May 2021, it acquired Adaptive Vision, which has been enhancing its offerings in fixed industrial scanning and machine vision markets.In September 2020, Zebra acquired Reflexis Systems, Inc, which has been complementing its software offerings across retail and other key markets. In second-quarter 2021, acquisitions had a contribution of 1.6% to the company’s net sales.Zacks Rank, Price Performance and Estimate RevisionsZebra, with approximately $27 billion market capitalization, currently carries a Zacks Rank #3 (Hold). The company stands to benefit from the solid demand environment for its products and solutions, acquired assets, strong cash flows, and organic growth investments in the quarters ahead. However, escalating costs and expenses along with supply chain challenges pose major concerns for the company.Image Source: Zacks Investment ResearchYear to date, the company’s share price has increased 31.1% compared with the industry’s growth of 32.3%.The Zacks Consensus Estimate for the company’s earnings has been stable at $17.43 for 2021 in the past 60 days. The consensus estimate for 2022 earnings is pegged at $18.10, down 1% over the same time frame.Stocks to ConsiderSome better-ranked stocks from the Zacks Industrial Products sector are Alcoa Corporation AA, Stanley Black & Decker, Inc. SWK, Standex International Corporation SXI. While Alcoa currently sports a Zacks Rank #1 (Strong Buy), Stanley Black and Standex carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Alcoa pulled off an earnings surprise of 42.70%, on average, in the trailing four quarters.Stanley Black pulled off an earnings surprise of 11.87%, on average, in the trailing four quarters.Standex pulled off an earnings surprise of 10.52%, on average, in the trailing four quarters. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>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 Alcoa Corp. (AA): Free Stock Analysis Report Stanley Black & Decker, Inc. (SWK): Free Stock Analysis Report Standex International Corporation (SXI): Free Stock Analysis Report Zebra Technologies Corporation (ZBRA): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 8th, 2021

Is GM a "Buy" After Setting Ambitious Growth Targets?

While General Motors (GM) impresses investors with ambitious financial targets laid out during its Investor Day, the stock still does not hold a 'Buy' rating. Read on to know more. General Motors’ GM two-day investor event, which began on Oct 6, seems to have managed to woo investors. Shares of the U.S. auto giant rose 4.7% to close the session at $56.44 yesterday, as the firm laid out a detailed roadmap to become the frontrunner in the auto industry, both in terms of technology development and profitability. CEO Marry Barra made a bold claim indicating that General Motors is on track to become the U.S. market share leader in the electric vehicle (EV) space. Despite all the buzz, the company still currently carries a Zacks Rank #4 (Sell). Why is that so? Does the growth target seem a bit far-fetched? Or is it just the right time to take profits in the stock as General Motors may decline (on temporary headwinds like a global chip crunch and rising costs) before it sees an upside again? Before delving into all that, here’s what the company stated about future growth plans during the much-awaited Investor Day event.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Golden Nuggets From the EventGeneral Motors believes that its compelling hardware and software platforms, electrification strides as well as aggressive autonomous vehicle (AV) development will result in major revenue growth by the end of the decade. The auto giant aims to double its five-year average annual revenues of $140 billion by 2030, with software and new businesses witnessing a CAGR of 50% through the decade-end. To that end, the company expects $80 billion in new revenues from software-enabled services, Cruise unit, BrightDrop business and OnStar insurance line.Revenues from the software and services platform are expected in the range of $20-$25 billion per year from an estimated 30 million connected vehicles. Part of the software and services revenue growth will stem from its OnStar subscription business, which is projected to generate annual sales of $6 billion by 2030. Last month, General Motors unveiled the Ultifi platform, a new end-to-end software platform in vehicles starting from 2023, built to unleash new vehicle experiences and seamlessly integrate customers’ digital lives. Its BrightDrop unit has the potential of generating $5 billion revenues by mid-decade and $10 billion by 2030-end. With the roll-out of the BrightDrop delivery business, General Motors is able to capitalize on the surging demand for urban last-mile delivery, while reducing carbon impact on the planet. Furthermore, the automaker has provided a one-stop-shop solution for commercial customers, enabling them to deliver goods in an efficient and more sustainable manner. This new business unit has unlocked fresh opportunities in the B2B sector for the company. BrightDrop recently completed the first production builds of the EV600 van and has planned to add a second van, the EV410, to its vehicle line-up in 2023. General Motors’ AV unit — Cruise — anticipates generating $50 billion in revenues as it scales up operations over the next couple of years. Last month, Cruise received a driverless deployment permit in California, becoming the first autonomous ride-hail company to secure the same. The company plans to charge for rides as early as next year, with a modified version of the Chevrolet Bolt electric car. Meanwhile, taking its AV game a notch higher, General Motors recently unveiled Ultra Cruise — an all-new technology enabling true hands-free drivingin 95% of scenarios that will be available in a handful of high-end vehicles starting 2023.Meanwhile, General Motors projects annual EV revenues to scale from $10 billion in 2023 to $90 billion by the decade-end. As stated earlier this year, the automaker plans to roll out 30 fresh EV models by 2025-end and transition to an all-electric fleet by 2035. The firm’s own modular battery platform, the Ultium Drive system, will aid in the transition to an all-electric portfolio down the road. The array of Ultium-powered EVs will include popular models, including a $30,000 Chevrolet crossover, Buick crossovers, Chevrolet trucks, GMC Hummer EV and Cadillac Lyriq crossover EV. The company will also offer an electric version of GMC’s Sierra pickup truck. General Motors plans to set up two new battery cell manufacturing plants in the United States by mid-decade, in addition to the facilities in Ohio and Tennessee. It recently set the stage for battery tech innovation with the announcement of establishing a new research facility in Michigan — Wallace Battery Innovation Center.Will GM be Able to Overtake the EV King?The fact that General Motors is eying to take the leadership position in the U.S. EV market share basically implies that the company believes that it can overtake Tesla’s TSLA crown in the coming years. With a market cap of around $78 billion, General Motors is currently far behind Tesla, which boasts a market value of $775 billion. Though General Motors is only second to Tesla in terms of U.S. EV sales, the latter leads by a huge margin. While the legacy auto giant claims to have transformed from an automaker to a platform innovator and is indeed putting out all the stops to stay ahead of much of the competition in electrification, software technology and driverless capabilities, will it be able to surpass Tesla’s EV prowess? General Motors also stated that 50% of its plants in North America and China will be capable of EV production by 2030 and become all-electric only by 2035. While the target in itself seems good enough, but since the company plans to beat Tesla’s market share, would that be sufficient? Well, it’s still too early to say if it would manage to overtake Tesla in the EV space. Jefferies analyst Philippe Houchois is of the opinion that “it may take time for markets to digest how realistic GM's roadmap is.” This indicates that its expectations might be too lofty.Temporary Hurdles in PathWhile General Motors manages to tick all the boxes to make the most out of the electrified and autonomous future while successfully attempting to transform itself into a technology play, its near-term prospects don’t seem too bright.Currently, General Motors ——which shares space with other auto biggies like Ford F, Toyota TM and Volkswagen VWAGY among others— is battling the global shortage of semiconductor supply. The company had already warned during the second-quarter earnings call that it expects challenges in the second half of 2021 due to plant downtime. Importantly, General Motors’ third-quarter sales took a nasty hit amid supply constraints and historically low inventories. Sales plummeted 33% year over year to 446,997 vehicles. Per U.S. Automotive News, this marks the company's lowest three-month tally since its 2009 bankruptcy. While General Motors’ big spending of $35 billion through 2025 for EV and AV development will prove beneficial in the long term, it is likely to strain the company’s near-term financials. As it is, the firm’s total debt to capitalization stands at 65%. Its long-term automotive debt at quarter-end increased to $16.4 billion from $16.2 billion as of Dec 31, 2020. It envisions 2021 adjusted automotive free cash flow in the band of $1-$2 billion, indicating a decline from $2.6 billion recorded in 2020. Capex for 2021 is anticipated between $9 billion and $10 billion, including $2 billion of deferred capex from 2020 as well as ramped-up EV spending. The forecast implies a significant uptick from the 2020 capex of $5.2 billion. This will hurt the company’s cash flows, especially at a time when sales are under pressure amid chip deficit. It should also be noted here that General Motors anticipates operating margins of 12-14% by 2030, implying just a modest improvement from 12.8% recorded in the first half of 2021.Last WordIndeed, General Motors might be hitting the right notes, but it’s a stock with quite a few short-term headwinds. So, it might not be the right time to hit the buy button on the stock. Instead, you can cash in on the share price gains currently, and buy it at an opportune time when the price dips. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>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 Ford Motor Company (F): Free Stock Analysis Report Toyota Motor Corporation (TM): Free Stock Analysis Report General Motors Company (GM): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Volkswagen AG (VWAGY): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 8th, 2021

Lululemon (LULU) Down 5% Since Last Earnings Report: Can It Rebound?

Lululemon (LULU) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues. It has been about a month since the last earnings report for Lululemon (LULU). Shares have lost about 5% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Lululemon due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. lululemon Q2 Earnings & Sales Beat, Solid Viewlululemon reported robust second-quarter fiscal 2021 results, with the top and bottom lines surpassing the Zacks Consensus Estimate as well as improving year over year. Also, the company noted that all key metrics reflected marked improvements from the second quarter of fiscal 2019, which represents the pre-pandemic level. Results were driven by robust response to the company’s products, improved store productivity and continued momentum in e-commerce.However, it has been witnessing supply-chain challenges, driven by the pandemic-led factory closures, congestion at ports and reduced airfreight capacity, which are likely to impact its business in the second half of fiscal 2021. Recently, some of the factories in Vietnam, which are used to source lululemon’s products, have closed due to another wave of COVID-19 outbreak in the region. This has delayed deliveries of products in recent months. The ongoing issues at the ports and reduced airfreight capacity have not only led to delays but also resulted in increased freight costs. The factors have impacted the company’s margins to some extent in the fiscal second quarter.Despite the headwinds related to COVID-19, including supply-chain disruptions, the company raised its guidance for fiscal 2021. Management noted that its strong business momentum continued in the second half of fiscal 2021.Q2 Numberslululemon’s adjusted earnings of $1.65 per share in the fiscal second quarter beat the Zacks Consensus Estimate of $1.21 and increased substantially from earnings of 74 cents in the year-ago quarter.The company’s quarterly revenues advanced 60.8% year over year to $1,450.6 million and surpassed the Zacks Consensus Estimate of $1,330 million. On a constant-dollar basis, revenues increased 56%. Top-line growth was driven by strength across all categories, channels and geographies. The momentum in brick-and-mortar stores, driven by improved footfall, as well as continued expansion in the e-commerce channel was a driver.Compared with the second quarter of fiscal 2019, earnings per share were up 71.9% from 96 cents, while net revenues improved 64%. On a two-year compounded annual growth rate basis, revenues rose 28%.In the reported quarter, revenues at company-operated stores advanced 142% year over year and 9% on a 2-year CARG basis to $695.1 million. It continued to witness strong traffic trends, which increased more than 150% from the last year. Management pointed out that in-store productivity was in line with comparable fiscal 2019 levels and reflected an improvement from 88% productivity in first-quarter fiscal 2021. Direct-to-consumer sales rose 8% to $597.4 million and were up 4% in constant currency. Direct-to-consumer revenues represented 41.2% of the company’s total revenues compared with 61.4% in second-quarter fiscal 2020.In the digital channel, revenues increased 66% on a two-year CAGR basis, benefiting from strength in traffic and conversions. Digital comps rose 4% in the fiscal second quarter compared with a 157% increase in the year-ago quarter. The increase in the year-ago quarter was driven by online warehouse sales and events that were not repeated this year.The company’s revenues improved 63% in North America and 49% in international markets on a year-over-year basis. It notes that revenues increased across each of its major regions, delivering revenue growth of 26% in North America and 43% in international markets on a 2-year CAGR basis. The improvement in international markets was driven by strong double-digit sales growth on a 2-year CAGR basis across all major regions.MarginsGross profit advanced 72% year over year to $842.7 million in second-quarter fiscal 2021. The gross margin expanded 390 basis points (bps) year over year to 58.1%.  On a two-year basis, the gross margin increased 310 bps from 55%, driven by 290-bps leverage in occupancy, product team costs and depreciation, and 60 bps of favorable foreign exchange, offset by a 40-bps decline in product margin. The decline in product margin was mainly driven by a 120-bps increase in airfreight expenses due to COVID-19, partly negated by lower markdowns than in 2019.SG&A expenses of $541.3 million increased 53.4% year over year and 70.3% on a two-year basis. SG&A expenses, as a percentage of sales, declined 180 bps year over year and increased 130 bps on a two-year basis to 37.3%. SG&A expense leverage on a year-over-year basis is mainly related to a higher top line than the COVID-impacted second-quarter fiscal 2020. The deleverage from the 2019 levels was mainly due to the consolidation of MIRROR’s results this year and deleverage on foreign exchange.Adjusted income from operations rose 120.2% year over year to $299.2 million in the fiscal second quarter. Adjusted operating margin of 20.6% expanded 560 bps year over year and 160 bps on a two-year basis.Store UpdatesIn the fiscal second quarter, the company opened 11 stores. As of Aug 1, 2021, it operated 534 stores. As the COVID-led restrictions ease, it currently has 95% of its stores open across the globe.In fiscal 2021, the company expects to open 45-55 net new company-operated stores, including 35-40 stores in the international markets.Financialslululemon exited the fiscal second quarter with total liquidity of $1.57 billion, which indicates a strong financial position. This included $1,170 million of cash and cash equivalents, and 397.2 million available under its revolving credit facility. Its stockholders' equity was $2,671.2 million as of Aug 1, 2021.Inventories were up 17.4% year over year to $789.8 million at the end of the fiscal second but below the company’s expectations of a 25-30% increase. The lower-than-expected inventory stemmed from the top-line outperformance as well as industry-wide supply-chain disruptions. On a 2-year CAGR basis, inventory grew 26%.In the first half of fiscal 2021, the company generated an operating cash flow of $499.8 million. It incurred a capital expenditure of $80 million in the fiscal second quarter compared with $53 million in second-quarter fiscal 2020. The capital spending is mainly related to store capital for new locations, relocation, and renovations; supply-chain investment; and technology spend to support business growth.At the end of third-quarter fiscal 2021, the company expects inventory levels to increase 15-20% from that reported in third-quarter fiscal 2020. The company is witnessing some delayed inventory receipts due to congestion at the ports and the recent COVID-related closures of certain factories in Southern Vietnam. While the expected inventory level is enough to support its revenue projection, it is lower thanFor fiscal 2021, the company anticipates incurring a capital expenditure of $365-$375 million.OutlookFor third-quarter fiscal 2021, it expects net sales of $1.4-$1.43 billion, indicating two-year CAGR growth of 24-25%. The company currently has 95% of its stores open. Management expects the gross margin to expand 50-100 bps from that reported in second-quarter fiscal 2019. Gross margin growth from the fiscal 2019 comparable period can be attributed to higher e-commerce penetration, and occupancy and depreciation cost leverage. The company’s gross margin guidance for the fiscal third quarter includes a 200-bps impact of higher airfreight costs, owing to port congestion and capacity constraints.The company expects SG&A expenses for the fiscal third quarter to deleverage 300-350 bps from that reported in the second quarter of fiscal 2019. The deleverage mainly relates to higher depreciation due to accelerated investments to support the e-commerce business in 2020 and 2021, consolidation of MIRROR’s results this year, and increased investments in brand-building for its growth initiative.Adjusted earnings are anticipated to be $1.33-$1.38 per share, whereas it reported $1.16 in the prior-year quarter and 96 cents in third-quarter fiscal 2019. This includes the operating results of MIRROR but excludes acquisition and integration costs.For fiscal 2021, it now expects net revenues of $6.19-$6.26 billion compared with $5.83-$5.91 billion stated earlier. The sales guidance implies a 2-year CAGR of 25%, which is higher than the 3-year CARG of 19%, leading up to 2020 and is significantly ahead of the low-teens CAGR targeted in the Power of Three growth plan.The sales guidance now assumes e-commerce sales growth in the mid-teens, whereas it saw outsized strength in 2020. Earlier, the company predicted high-single-digit e-commerce growth. The fiscal 2021 view assumes phased reopening of the factories used for sourcing products in Vietnam in mid-September.The gross margin for fiscal 2021 is expected to expand 150-120 bps, whereas it reported modest gross margin growth in fiscal 2020. The gross margin view for fiscal 2021 now includes an estimated 150-200 bps negative impact of additional freight costs compared with a 50-bps impact mentioned earlier. However, the gross margin view surpasses the modest annual gross margin expansion targeted under the Power of Three growth plan. The company now anticipates a year-over-year SG&A deleverage of 10-30 bps for fiscal 2021, including its investment in MIRROR brand building. The company earlier predicted SG&A deleverage of 30-50 bps.Adjusted earnings per share are expected to be $7.38-$7.48 compared with $6.73-$6.86 mentioned earlier. This includes a modest dilution of 3-5% related to the MIRROR acquisition.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed an upward trend in estimates revision.VGM ScoresCurrently, Lululemon has a great Growth Score of A, though it is lagging a bit on the Momentum Score front with a B. However, the stock was allocated a grade of D on the value side, putting it in the bottom 40% for this investment strategy.Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Lululemon has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>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 lululemon athletica inc. (LULU): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksOct 8th, 2021

Futures Drift Before Taper-Triggering Jobs Report

Futures Drift Before Taper-Triggering Jobs Report US equity-index drifted in a tight range overnight, in a tight range before key jobs data that could provide clues on the Federal Reserve’s policy. As noted in our preview, unless the jobs report is a disaster, it will virtually assure the Fed launches tapering in one month. Markets drifted higher on Thursday after the Senate averted the risk of an immediate default, pushing global stocks on course for their best week since early September, but a late day selloff wiped away most gains and closed spoos below the critical 4400 level. At 07:30 a.m. ET, Dow e-minis were up 35 points, or 0.10%, S&P 500 e-minis were up 5.00 points, or 0.1%, and Nasdaq 100 e-minis were up 10.75 points, or 0.07%. Treasury Yields were 1 point higher after earlier tagging 1.60%, the highest since June. The dollar was flat while Brent topped $83 before paring gains. Bitcoin traded above $55,000. Uncertainty over the debt ceiling negotiations and a run-up in U.S. Treasury yields over elevated inflation were major concerns among investors earlier this week, injecting volatility in equity markets this week. High-growth FAAMG stocks slipped in premarket trading following sharp gains in previous session. Energy firms including Chevron Corp and Exxon Mobil gained about 0.8% tracking crude prices, while major U.S. lenders also edged up as the benchmark 10-year yield hit its highest level since June 4. Here are some of the biggest movers and stocks to watch today: Tesla (TSLA US) shares in focus after Elon Musk says a global shortage of chips and ships is the only thing standing in the way of the company maintaining sales growth in excess of 50% Sundial Growers (SNDL US) shares rise as much as 19% in U.S. premarket after the Canadian cannabis producer said it will buy liquor and pot retailer Alcanna for $276m in stock Allogene Therapeutics (ALLO US) plunges 36% in U.S. premarket trading after an early-stage study of its cell therapy was put on hold by U.S. regulators Prelude Therapeutics (PRLD US) fell in U.S. premarket trading, adding to Thursday’s 40% plunge on early- stage data for the company’s experimental cancer treatments that Barclays says came in below expectations Vaxart (VXRT US) rises 8% in U.S. premarket trading after its oral tablet vaccine candidate cut transmission of Covid-19 in animals, according to data from a study led by Duke University Faraday Future (FFIE US) slides 4% in U.S. premarket trading after J Capital says it is short on the stock. The short-seller says they don’t think the company “will ever sell a car” Codiak Biosciences (CDAK US) shares fell 6% in Thursday postmarket trading after disclosing that Sarepta Therapeutics is terminating a research license and option agreement Agile Therapeutics (AGRX US) tumbled Thursday postmarket after the women’s health-care company said that it intends to offer and sell shares of its common stock, as well as warrants to purchase shares of its common stock, in an underwritten public offering Looking to today's main event, economists expect September hiring to have surged by 500,000 jobs as the summer wave of COVID-19 infections began to subside, and as millions of Americans no longer receive jobless benefits, positioning the Fed to start scaling back its monthly bond buying.  “All roads lead to non-farm payrolls data which will decide, in the market’s minds, whether the start of the Fed taper is a done deal for December,” said Jeffrey Halley, senior market analyst at OANDA. “I do not believe that markets have priced in the Fed taper and its implications to any large degree yet. Even a weak number probably only delays the inevitable for another month.” Even “reasonably soft” payrolls and unemployment figures wouldn’t be enough to change the minds of its officials, according to Ipek Ozkardeskaya, senior analyst at Swissquote. “Only a shockingly low figure could do that,” she said. “The persistent rise in oil prices can only continue boosting inflation fears and the central bank hawks, limiting the upside potential in case of a further recovery in stocks.” “As soon as you start thinking about tapering it’s really hard to not then think about what that means for the Fed funds rate and when that might start to increase,” Kim Mundy, currency strategist and international economist at Commonwealth Bank of Australia in Sydney, said on Bloomberg Television. “We do see scope that markets can start to price in a more aggressive Fed funds rate hike cycle.” In Europe, tech companies led the Stoxx Europe 600 Index down 0.2%, with energy stocks and carmakers being the only industry groups with meaningful gains. Chip stocks fell, especially Apple suppliers, following a profit warning from Asian peer and fellow supplier AAC Technologies. On the other end, European travel stocks rose after U.K. confirmed the travel “red list” will be cut to just seven countries; British Airways parent IAG and TUI led the advances. Here are some of the biggest European movers today: Daimler shares gains as much as 3.2%, outperforming peers, after UBS upgrades stock to buy from neutral, calling it an earnings momentum story that stands to gain from strong demand, electrification trends and its future focus on passenger cars. Adler shares rise as much as 13% after shareholder Aggregate sells a call option to Vonovia for a 13.3% stake in the German real estate investment firm at a strike price of EU14 per share. Cewe Stiftung shares jump as much as 4.2%, their best day in over three months, after the photography services firm gets a new buy rating at Hauck & Aufhaeuser. Weir shares fall as much as 6.3%, to the lowest since Nov. 13, after the U.K. machinery maker announced that a ransomware attack will affect full-year profitability; Jefferies says it’s unlikely that guidance beyond that will be revised. Zur Rose slumps as much as 9.2% after Berenberg downgrades the Swiss online pharmacy to hold from buy, citing the expected negative impact from a delay in the implementation of mandatory e-prescriptions in Germany. Czech digital-payments provider Eurowag shares slide as much as 10% as it starts trading in London, after pricing its IPO below an initial range and making its debut a day later than planned. Asian stocks rose for a second day as China’s market reopened higher and the U.S. Senate approved a short-term increase in the debt ceiling. The MSCI Asia Pacific Index advanced as much as 1% in a rally led by consumer discretionary shares. Alibaba and Tencent were among the biggest contributors to the gauge’s climb. Shares in mainland China surged more than 1% as investors returned from the Golden Week holiday. Chinese property shares fell after a report that more than 90% of China’s top 100 property developers’ sales declined in September by an average of 36% from the same period last year, while investor concerns about developers’ liquidity rose after Fantasia bonds were suspended from trading. In mainland: CSI 300 Real Estate Index drops as much as 2%, Seazen Holdings falls as much as 5%, Poly Developments -4%. Asia’s stock benchmark is slightly down for the week, as rising bond yields weighed on tech-heavy indexes in South Korea, Taiwan and Japan. The gauge is down more than 1% this month amid an energy shortage in China and India.  “Markets may not want to commit directionally” given that we have non-farm payrolls data on the docket, making a follow-through of today’s rally suspect, said Ilya Spivak, the head of Greater Asia at DailyFX. Traders are expecting today’s U.S. employment data to provide clues on the direction of the world’s largest economy. On Thursday, the U.S. averted what would have been its first default on a debt payment. Most major benchmarks in Asia climbed, led by Japan, Indonesia and Australia. India’s central bank kept its lending rates at a record low at a policy meeting today. In Australia, the S&P/ASX 200 index rose 0.9% to close at 7,320.10. All industry groups edged higher. The benchmark rose 1.9% for the week, the biggest weekly gain since early August. Miners led the charge, having the best week since July, banks the best since the start of March. EML Payments tumbled after an update on its Ireland subsidiary from the country’s central bank. Chalice Mining continued its rebound, finishing the session the strongest performer in the mining subgauge.  There is a risk of excessive borrowing due to low interest rates and rising house prices, Reserve Bank of Australia said in its semiannual Financial Stability Review released Friday. In New Zealand, the S&P/NZX 50 index fell 0.1% to 13,086.60 In rates, Treasury futures remained under pressure after paring declines that pushed 10-year yield as high as 1.5995% during European morning, highest since June 4; the 1.60% zone is thought to have potential to spur next wave of convexity hedging. U.K. 10-year is higher by 4bp, German by 2.3bp - gilts underperformed, weighing on Treasuries as money markets continue to bring forward BOE rate-hike expectations. During U.S. session, September jobs report may seal case for Fed taper announcement in November.  In FX, the greenback traded in a narrow range versus G10 peers while 10-year Treasury yields approached 1.6%, outperforming Bunds.  Gilt yields rose 5-6bps across the curve; demand for downside protection in the pound eases this week as the U.K. currency moves off cycle lows amid money markets repricing. U.K. wage growth rose at its strongest pace on record in a survey of job recruiters, indicating strains from a shortage of workers are persisting. Turkish lira initially weakens above 8.96/USD before recouping half of its losses In commodities, oil extended a rebound, on track for a seventh weekly gain. Crude futures pushed to the best levels for the week. WTI rises 1.5% near $79.50, Brent pops back on to a $83-handle. Spot gold trades a $5 range near $1,757/oz. Base metals are mostly positive, with LME nickel gaining over 3.5%. Looking at the day ahead, the highlight will be the aforementioned September jobs report. Central bank speakers include ECB President Lagarde and the ECB’s Panetta. Market Snapshot S&P 500 futures little changed at 4,389.50 STOXX Europe 600 down 0.3% to 457.18 MXAP up 0.4% to 194.72 MXAPJ up 0.2% to 636.80 Nikkei up 1.3% to 28,048.94 Topix up 1.1% to 1,961.85 Hang Seng Index up 0.6% to 24,837.85 Shanghai Composite up 0.7% to 3,592.17 Sensex up 0.7% to 60,070.61 Australia S&P/ASX 200 up 0.9% to 7,320.09 Kospi down 0.1% to 2,956.30 Brent Futures up 1.4% to $83.09/bbl Gold spot up 0.0% to $1,756.25 U.S. Dollar Index little changed at 94.29 German 10Y yield up +3.4 bps to -0.151% Euro little changed at $1.1549 Top Overnight News from Bloomberg Global talks to reshape the corporate tax landscape are set to resume on Friday after Ireland’s decision to adhere to the world consensus on a minimum rate removed one hurdle to an agreement that still hangs in the balance Germany’s Social Democrats hailed a positive start in their effort to form a government after their first meeting with the Greens and the pro-business Free Democrats A U.S. nuclear-powered attack submarine struck an object while submerged in international waters in the Indo- Pacific region last week, the Navy said, adding that no life- threatening injuries were reported China drained the most short- term liquidity from the banking system in a year on a net basis as it reduced support after a week-long holiday. Government bond futures slid by the most since August China’s central bank will continue to push for the reform of its benchmark loan rate and make deposit rates more market-based, according to a senior official India’s central bank surprised markets by suspending its version of quantitative easing, signaling the start of tapering pandemic-era stimulus measures as an economic recovery takes hold U.K. government bond yields have climbed to levels last seen before the Brexit referendum in 2016 relative to German peers, as traders brace for inflation in Britain over the next decade to far outpace the rate in Europe’s largest economy A detailed look at global markets courtesy of Newsquawk Asia-Pac stocks traded mostly higher as the region conformed to the global upbeat mood after the agreement in Washington to raise the debt ceiling which the Senate approved, with the overnight bourses also invigorated by the return of China and strong Caixin PMI data. The ASX 200 (+0.9%) was led higher by strength in mining names with underlying commodity prices boosted as Chinese buyers flocked back to market which helped the ASX disregard a record increase in daily COVID-19 cases in Victoria state. Nikkei 225 (+1.3%) was the biggest gainer and reclaimed the 28k level as exporters benefitted from a softer currency, while attention turns to PM Kishida who will outline his policy program today and is reportedly planning to present an additional budget after the election. Furthermore, there were recent comments from an ally of the new PM who suggested that capital gains tax could be raised to 25% from the current 20% without affecting stock prices, although this failed to dent the mood in Tokyo and weaker than expected Household Spending was also brushed aside. The gains for the KOSPI (-0.1%) were later reversed alongside the tentative price action in index heavyweight Samsung Electronics after its Q3 prelim. results showed oper. profit likely rose to its highest in three years but missed analysts’ forecasts. Hang Seng (+0.6%) and Shanghai Comp. (+0.7%) were mixed with the latter jubilant on reopen from the Golden Week holiday after improved Caixin Services and Composite PMI data which both returned to expansionary territory. This helped mainland stocks overlook the recent developer default fears and largest daily liquidity drain by the PBoC since October last year, although Hong Kong initially lagged amid heavy Northbound Stock Connect trade. Finally, 10yr JGBs declined on spillover selling from T-notes and with havens shunned amid the gains across riskier assets, although downside in JGBs was limited given the BoJ’s presence in the market for nearly JPY 1.5tln of JGBs with up to 10yr maturities. Top Asian News Gold Steadies Ahead of Key U.S. Jobs Report as Yields Climb Investors Fear Tax Talk in Kishida’s ‘New Japanese Capitalism’ China Coal Prices Plunge as Producers Vow to Ease Shortages China Developer Stocks Fall After Report of Monthly Sales Drop An initially contained to marginally-firmer European cash open followed an upbeat APAC handover (ex-Hang Seng) was short-lived with bourses coming under moderate pressure; Euro Stoxx 600 -0.3%. As such, major indices are all in the red, except for of the UK FTSE 100 which is essentially unchanged and bolstered by strength in heavy-weight energy and mining names given broader price action the return of China. Sectors were initially mixed at the open, but in-fitting with the action in indices, has turned to a predominantly negative performance ex-energy. Crossing to the US, futures have directionally been following European peers, but the magnitude has been more contained, with the ES unchanged as we await the September labour market report for any read across to the Fed’s policy path; however, officials have already made it clear that it would have to be a very poor report to spark a deviation from its announced intentions, where it is expected to announce an asset purchase tapering in November. Returning to Europe, Daimler (+2.5%) stands out in the individual stocks space, firmer after a broker upgrade and notable price target lift at UBS; Marks & Spencer (+1.5%) is also supported on broker action. To the downside lies Weir Group (-3.0%) after reports of a ransomware attack. Top European News Adler’s Largest Shareholder Sells Option on Stake to Vonovia; A Controversial Tycoon Sits on Adler’s $9 Billion Pile of Debt Chip Stocks Drag Tech Gauge Lower as Asian Apple Supplier Warns European Gas Rises as Bumpy Ride Continues With Cold Air Coming Lira Weakens to Fresh Low as Rising U.S. Yields Add Pressure In FX, the Dollar is trying to regroup and firm up again after its latest downturn amidst a further rebound in US Treasury yields, more pronounced curve re-steepening, and perhaps some relief that the Senate finally passed the debt ceiling extension bill, albeit by a slender margin and only delaying the issue until early December. Looking at the DXY as a benchmark, a marginally higher low above 94.000 and lower high below 94.500 is keeping the index contained as the clock ticks down to September’s jobs report that is expected to show a recovery in hiring after the prior month’s shortfall, but anecdotal data has been rather mixed to offer little clear pointers for the bias around consensus - full preview of the latest BLS release is available via the Research Suite under the Ad-hoc Economic Analysis section. From a technical perspective, near term support for the DXY resides at 94.077 (vs the current 94.139 base) and resistance sits at 94.448 (compared to a 94.338 intraday high). TRY - A double whammy for the already beleaguered Lira as oil prices come back to the boil and ‘sources’ suggest that Turkish President Erdogan’s patience is wearing thin with the latest CBRT Governor as the Bank waited until September to cut rates. Recall, Erdogan has already ousted a CBRT chief for not loosening monetary policy in his belief that lowering the cost of borrowing will bring inflation down, and although the reports have been by a senior member of his administration there is a distinct feeling of no smoke without fire in the markets as Usd/Try remains bid having only held below 9.0000 by short distance between 8.9707-8.8670 parameters. CHF/JPY - No real surprise that the low yielders and funders are underperforming, even though broadly upbeat risk sentiment during APAC hours has not rolled over to the European session. The Franc has retreated to 0.9300 vs the Buck and Yen is trying to fend off pressure on the 112.00 handle after failing to sustain momentum through 111.50 before weaker than expected Japanese household spending data overnight. However, decent option expiry interest from 111.85-75 (1.4 bn) may weigh on Usd/Jpy pending the aforementioned US payrolls outcome. AUD - Some payback for the Aussie after Thursday’s outperformance, as Aud/Usd loses a bit more momentum following its rebound beyond 0.7300 and with hefty option expiries at 0.7335 (2.7 bn) capping the upside more than smaller size at the round number (1.1 bn) cushions the downside. In commodities, WTI and Brent remain on an upward trajectory after the mid-week pullback; as it stands, crude benchmarks are near fresh highs for the week, with WTI for November eyeing USD 80/bbl once again. Fresh news flow for the complex has been sparse, aside from substantial UK press focus on the domestic energy price cap potentially set to increase next year. More broadly, US officials have largely reiterated commentary from the Energy Department provided on Thursday around not currently intending act on energy costs with a reserve release. The session ahead has just the Baker Hughes rig count specifically for crude scheduled, though the complex may well get dragged into a broader risk move depending on the initial reaction to and analysis on NFP. For metals, spot gold and silver are contained around the unchanged mark and haven’t been affected by any significant amount by the firmer USD or elevated yield space thus far. Elsewhere, base metals are buoyed by China’s return and strong Caixin data from the region, although it is worth highlighting that the likes of LME copper are well off earlier highs. US Event Calendar 8:30am: Sept. Change in Nonfarm Payrolls, est. 500,000, prior 235,000 Change in Private Payrolls, est. 450,000, prior 243,000 Change in Manufact. Payrolls, est. 25,000, prior 37,000 Unemployment Rate, est. 5.1%, prior 5.2% Sept. Underemployment Rate, prior 8.8% Labor Force Participation Rate, est. 61.8%, prior 61.7% Average Weekly Hours All Emplo, est. 34.7, prior 34.7 Average Hourly Earnings MoM, est. 0.4%, prior 0.6% Average Hourly Earnings YoY, est. 4.6%, prior 4.3% 10am: Aug. Wholesale Trade Sales MoM, est. 0.9%, prior 2.0%; Wholesale Inventories MoM, est. 1.2%, prior 1.2% DB's Jim Reid concludes the overnight wrap I’ve never quite understood why you’d go to the cinema if you’ve got a nice telly at home but such has been the nature of life over the last 19 months that I was giddy with excitement last night at booking tickets for James Bond at the local cinema next week. We’ve booked it on the same night as our first ever physical parents evening where I’ll maybe have the first disappointing clues that my three children aren’t going to be child prodigies and that maybe they’ll even have to settle for a career in finance! Markets have been stirred but not completely shaken this week and yesterday they continued to rebound thanks to the near-term resolution on the US debt ceiling alongside subsiding gas prices, which took the sting out of two of the most prominent risks for investors over the last couple of weeks. That provided a significant boost to risk appetite, and by the close of trade, the S&P 500 had recovered +0.83% in its 3rd consecutive move higher, which put it back to just -3.0% beneath its all-time high in early September, whilst Europe’s STOXX 600 was also up +1.60% and closed before a later US sell-off. Attention will today focus squarely on the US jobs report at 13:30 London time, which is the last one before the Fed’s next decision in early November, where a potential tapering announcement is likely bar an extraordinarily poor number today, or an exogenous event in the next few weeks. Starting with the debt ceiling, yesterday saw Democratic and Republican Senators agree to pass legislation to raise the ceiling by enough to get to early December, meaning we won’t have to worry about it for another 8 whole weeks. The Senate voted 50-48 with no Republicans blocking the legislation to increase the debt limit by $480bn, with House Majority leader Hoyer saying that the House would convene on Tuesday to pass the measure as well. To raise it for a longer period, the chatter out of Washington made it clear that Democrats would need to need to raise the debt ceiling in a partisan manner as part of the reconciliation process. As we mentioned in yesterday’s edition, this extension means that a number of deadlines have now been punted into the year end, including the government funding and the debt ceiling (both now expiring the first Friday of December), just as the Democrats are also seeking to pass Biden’s economic agenda through a reconciliation bill containing much of their social proposals, alongside the $550bn bipartisan infrastructure package. And on top of that, we’ve also got the decision on whether Chair Powell will be re-nominated as Fed Chair, with the decision 4 years ago coming at the start of November. So a busy end to the year in DC. The other main story yesterday was the sizeable decline in European natural gas prices, with the benchmark future down -10.73% to post its biggest daily loss since August. Admittedly, they’re still up almost five-fold since the start of the year, but relative to their intraday peak on Wednesday they’ve now shed -37.5%. So nearly a double bear market all of a sudden! The moves follow Wednesday’s signal that Russia could supply more gas to Europe. However, even as energy prices were starting to fall back from their peak, the effects of inflation were being felt elsewhere, with the UN’s world food price index climbing to its highest level in a decade in September. Looking ahead, today’s main focus will be on the US jobs report for September later on. Last month the report significantly underwhelmed expectations, coming in at just +235k, which was well beneath the +733k consensus expectation and the slowest pace since January. That raised questions as to the state of the labour market recovery, and helped to complicate a potential decision on tapering, with nonfarm payrolls still standing over 5m beneath their pre-Covid peak. This month, our US economists are expecting a somewhat stronger +400k increase in nonfarm payrolls, which should see the unemployment rate tick down to a post-pandemic low of 5.1%. On the bright side at least, the ADP’s report of private payrolls for September on Wednesday came in at an above-forecast 568k (vs. 430k expected), while the weekly initial jobless claims out yesterday for the week through October 2 were beneath expectations at 326k (vs. 348k expected). Ahead of that, global equities posted a decent rebound across the board, with cyclicals leading the march higher on both sides of the Atlantic. As mentioned at the top, the S&P 500 advanced +0.83%, which was part of a broad-based advance that saw over 390 companies move higher on the day. That said the index was up as much as +1.5% in early US trading before slipping lower in the US afternoon. The pullback was partly due to new headlines that China’s central bank plans to continue addressing monopolistic actions in internet companies that operate in the payments sector. Nonetheless, Megacap tech stocks were among the big winners yesterday, with the FANG+ index up +2.08%, whilst the small-cap Russell 2000 index was also up +1.58%. In Europe, the STOXX 600 (+1.60%) posted its strongest daily gain since July, and the broader gains helped the STOXX Banks index (+1.61%) surpass its pre-pandemic high, taking it to levels not seen since April 2019, even as sovereign bond yields moved lower. Speaking of sovereign bonds, yesterday saw a divergent set of moves once again, with yields on 10yr Treasuries up +5.2bps to 1.573%, their highest level since June, whereas those across the European continent moved lower. The US increase came against the backdrop of that debt ceiling resolution, and there was a noticeable rise in yields for Treasury bills that mature in December, which is where the debt ceiling deadline has now been kicked to. Elsewhere in North America, the Bank of Canada’s Macklem joined the global central bank chorus and noted inflation pressures were likely to be temporary, even if they’ve been more persistent than previously expected. Meanwhile over in Europe, lower inflation expectations helped yields move lower, with those on 10yr bunds (-0.3bps), OATs (-1.1bps) and BTPs (-3.6bps) all moving back. Overnight in Asia, all markets are trading in the green with the Nikkei (+2.16%) leading the way, along with CSI (+1.34%), Shanghai Composite (+0.60%), KOSPI (+0.22%) and Hang Seng (+0.04%). Chinese markets reopened after a week-long holiday so the focus will again be back on property market debt, and today the PBOC injected just 10bn Yuan with its 7-day reverse repos, resulting in a net liquidity withdrawal of 330bn Yuan. That comes as the services and composite PMIs did see a pickup from August level, with the services PMI up to 53.4 (vs. 49.2 expected), moving back above the 50 mark that separates expansion from contraction. In Japan however, household spending was down -3.0% year-on-year in August (vs. -1.2% expected) which came amidst a surge in the virus there. There’s also some news on the ESG front, with finance minister Shunichi Suzuki saying that the country would introduce ESG factors when considering the finance ministry’s foreign reserves. Looking forward, S&P 500 futures (+0.06%) are pointing to a small move higher. In Germany, as talks got underway today on a potential traffic-light coalition, it was reported by DPA that CDU leader Armin Laschet had signalled his willingness to stand down, with the report citing unidentified participants from internal discussions. In televised remarks last night, Laschet said that his party needs fresh voices across the board and that new leadership will be in place soon. This moves comes as Germany’s Social Democratic Party held talks with the Greens and the Free Democratic Party to enact a new three-way ruling coalition, which would leave the CDU out of power entirely. There wasn’t a massive amount of data yesterday, though German industrial production fell by -4.0% in August (vs. -0.5% expected), which follows the much weaker than expected data on factory orders the previous day. Elsewhere, the Manheim used car index increased +5.3% in September, its first positive reading in 4 months. Our US economics team points out that there tends to be around a two month lag between wholesale prices and CPI prints, so we aren’t likely to see this impact next week’s CPI print but it will likely prevent a bigger fall towards the end of the year. To the day ahead now, and the highlight will be the aforementioned September jobs report from the US. Central bank speakers include ECB President Lagarde and the ECB’s Panetta. Tyler Durden Fri, 10/08/2021 - 07:50.....»»

Category: smallbizSource: nytOct 8th, 2021

5 Top-Ranked Small Hidden Gems That Can Be Game Changers in Q4

We have narrowed down our search to six small business operators that have surged in the past month and have more upside left for the rest of 2021. These are: CLFD, CDOR, METC, AOSL and SBOW. Wall Street is resembling its historically fluctuating trade in October after a tumultuous September. While market participants are predominantly concerned about the performance of large-cap stocks, it was the small-cap segment that suffered the least in September’s mayhem.In September, the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — plunged 4.3%, 4.8% and 5.3%, respectively. The mid-cap-centric S&P 400 plummeted 4.1%. However, the small-cap-specific Russell 2000 and the S&P 600 slid only 3.1% and 2.6%, respectively.Several small-cap stocks have surged in the past month defying market volatility. A handful of these stocks sport a Zacks Rank #1 (Strong Buy) with solid upside left. These stocks have provided double-digit returns in the past month while the market’s benchmark the S&P 500 Index fell 4%. At this stage, investment in these stocks should be prudent in the near future.Importance of Small BusinessesSmall businesses create a significant number of jobs in the U.S. economy. More than 50% of the newly created jobs in the private sector originate here. These people constitute a large part of customers for big businesses.Moreover, small companies are a major part of the supply chain management systems of large companies for innovative and technologically superior inputs. Additionally, small businesses more often than not form a vital cog in corporate America's customer base.Given their small-scale of operations, small businesses are generally cash-starved. These organizations operate on a thin profit margin and most new businesses are yet to achieve profitability. Consequently, the reopening of the economy immensely benefitted small businesses.Future CatalystsAs new cases of the highly-infectious Delta variant of coronavirus subdued last month, the reopening-oriented small-businesses are likely to benefit more. Per CDC, in the United States, 7-day average new cases came in at 97,909 as of Oct 4, compared with 160,284 a month ago. Nationwide vaccination drives also resulted in faster-than-expected reopening.Both business spending and consumer spending remain firm in the third quarter of 2021. Massive pent-up demand for both intermediary and final products ramped up small business activities. Holiday season sales in the fourth quarter are likely to boost small businesses.On Sep 14, the National Federation of Independent Business (NFIB) reported that its Small Business Optimism Index rose 0.4 points in August to reach 100.1 from 99.7 in July. Market participants were expecting this index to pullback to 99 on average. However, a shortage of skilled manpower and prolonged disturbance in the supply-chain system took a tool on small business operators.Our Top PicksWe have narrowed down our search to six small business (market capital < 1 billion) operators that have surged in the past month with more upside left for the rest of 2021. These stocks have seen positive earnings estimate revisions within the last 60 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 in the past month.Image Source: Zacks Investment ResearchSilverBow Resources Inc. SBOW is engaged in the exploration, development and production of oil and natural gas properties. Its primary projects include the Eagle Ford wells, Burr Ferry, South Bearhead Creek and Lake Washington fields. SilverBow Resources Inc.The company has an expected earnings growth rate of more than 100% for fourth-quarter 2021. The Zacks Consensus Estimate for its fourth-quarter earnings improved 8.5% over the last 30 days. The stock price has soared 25.7% in the past month.Condor Hospitality Trust Inc. CDOR is a self-administered real estate investment trust. it specializes in the investment and ownership of upper midscale and upscale, premium-branded select-service, extended stay and limited-service hotels.The company has an expected earnings growth rate of more than 100% for fourth-quarter 2021. The Zacks Consensus Estimate for its fourth-quarter earnings improved 66.7% over the last 60 days. The stock price has jumped 22.3% in the past month.Ramaco Resources Inc. METC is an operator and developer of metallurgical coal primarily in southern West Virginia, southwestern Virginia and southwestern Pennsylvania. It operates principally in Charleston, West Virginia.The company has an expected earnings growth rate of more than 100% for fourth-quarter 2021. The Zacks Consensus Estimate for its fourth-quarter earnings improved 66.7% over the last 60 days. The stock price has climbed 21.3% in the past month.Clearfield Inc. CLFD manufactures, markets and sells standard and custom passive connectivity products to the fiber-to-the-premises, enterprises and original equipment manufacturers markets in the United States and internationally.The company has expected earnings growth of 43.5% for the quarter ending Dec 31. The Zacks Consensus Estimate for the quarter ending Dec 31 improved by 10% over the last 7 days. The stock price has surged 11.2% in the past month.Alpha and Omega Semiconductor Ltd. AOSL designs, develops, and supplies power semiconductor products for computing, consumer electronics, communication, and industrial applications in Hong Kong, China, South Korea, the United States, and internationally.The company has expected earnings growth of 29.2% for the quarter ending Dec 31. The Zacks Consensus Estimate for the quarter ending Dec 31 improved by 18.3% over the last 60 days. The stock price has advanced 10.7% in the past month. Breakout Biotech Stocks with Triple-Digit Profit Potential The biotech sector is projected to surge beyond $2.4 trillion by 2028 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases. Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Recommendations from previous editions of this report have produced gains of +205%, +258% and +477%. The stocks in this report could perform even better.See these 7 breakthrough 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 Alpha and Omega Semiconductor Limited (AOSL): Free Stock Analysis Report Clearfield, Inc. (CLFD): Free Stock Analysis Report Condor Hospitality Trust, Inc. (CDOR): Free Stock Analysis Report Ramaco Resources, Inc. (METC): Free Stock Analysis Report SilverBow Resources Inc. (SBOW): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksOct 7th, 2021