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GameStop Shares Continue To Bleed Lower: What"s Next?

GameStop Corp. (NYSE: GME) shares are trading lower Friday alongside other retail and apparel stocks following data that shows a drop in retail sales. The stock has recently fallen below the higher low trendline in what traders call an ascending triangle pattern. read more.....»»

Category: blogSource: benzingaJan 14th, 2022

A former Hollywood ad producer who now lives on Airbnb shares her top tips for long-term travel and nomadic living

After the death of her father, Denise Netzley used her inheritance to move out of Los Angeles and spend six months living in Mexico and South Africa. Denise Netzley embracing nomadic living.Denise Netzley Airbnb is seeing users book longer stays, with 20% of nights booked for a month or more. One long-term traveller told Insider she has been living on Airbnb for the past six months. Although she's funding the trip with an inheritance, her monthly costs are comparable to her former rent. The decision came — as life-changing ones tend to do — in the middle of the night.It was January of last year and Denise Netzley said she had been thinking for several weeks about moving out of her apartment in Los Angeles and living for the foreseeable future on Airbnb."I woke up," she told Insider, "and I was just like, 'Yeah, I'm doing this, 100% I'm doing this.'"The following morning she started getting rid of what belongings she could, moved the rest into storage, and made reservations on Airbnb.At 59 years old, Netzley had some savings from a career producing ads for Hollywood films, followed by a personal assistant business that was winding down. She also received an inheritance following the death of her father three years ago, which she said made the whole plan possible.Denise NetzleyDenise NetzleyIn becoming a full-time Airbnb guest, Netzley was joining a growing set of power users who are booking longer and longer reservations on the platform.Company data show that roughly a fifth of nights booked were for stays longer than a month, CEO Brian Chesky said in a recent Twitter thread in which he announced that he too is now "living on Airbnb."The first reservation Netzley made was the one where she's currently living — in her father's birthplace of Kansas City, Missouri. From there she worked backwards, filling in the months with stays in Mexico and South Africa.In making the reservations, Netzley discovered by accident that some hosts offer discounts ranging from 15% to 50% when a reservation passes a certain length.In May of last year, Netzley handed over the keys to her LA apartment and departed for a six-week stay in Playa Del Carmen, Mexico."The first few days there I was completely overwhelmed, a fish out of water," she said. "But after the first week I got the lay of the land and I got comfortable enough to rent a car and start taking these day trips to different places, like Tulum."Denise Netzley in South Africa.Denise NetzleyNetzley's advice to similarly out-of-water fish is simple: "Sit at the bar in any restaurant when you go, people are going to be more inclined to be conversational. The bartender is going to help make connections. I just always sit at the bar almost anywhere I go."She spent August in a Kansas City neighborhood that she was considering to live post-travel before jetting off to Cape Town where a condo in a ten-unit building became her two-month base-camp for shorter jaunts around Africa."I found that I like having a home base," she said. "I just love the idea that I didn't have to schlep everything. I could just take a small bag and leave my stuff."Netzley added that she was able to get by with bringing about half the amount of stuff to Africa that she had brought with her to Mexico.And although she wasn't keeping a close eye on her budget, the purchasing power of the US dollar overseas meant that she was effectively living at a similar or lower monthly cost to what she would have paid in rent and expenses had she simply stayed in LA.On her way back to the US in December, she passed through Uganda and went on a gorilla trek that she said was the "absolute pinnacle" of the six-month journey.Now back in Kansas City at the same Airbnb host she stayed with in August, Netzley says she's "at a crossroads" trying to determine how she can continue to support her future travels, including launching a new business idea.Before she had set out in the first place, she had decided not to become attached to the inheritance money from her father, and now she's determined not to let this new business take over too much of her life."I've discovered in this travel — and in this year — that there's so much joy out there," Netzley said." I would never give up that for money, ever."Read the original article on Business Insider.....»»

Category: worldSource: nyt19 hr. 5 min. ago

Bank Stock Roundup: JPM, C, WFC, BAC & PNC in Focus on Q4 Earnings Beat

Major banks, including JPM, C, WFC, BAC & PNC, surpass Q4 earnings estimates on revenue strength, solid loan balance and provision benefit. Yet, rising cost expectations lead to bearish investor sentiments. Major banks’ Q4 earnings have been in full swing over the past four trading days. Almost all banks, including JPMorgan JPM, Citigroup C, Wells Fargo WFC, Bank of America BAC and PNC Financial PNC that announced quarterly results, beat earnings estimates on revenue strength, decent rise in loan demand and provision benefit.During the fourth quarter, a modest rise in loan demand drove net interest income (NII). However, major banks’ net interest margin growth was hampered by considerable deposits in their balance sheets and lower interest rates.On the fee income front, major banks’ top line received support from the solid performance of investment banking (IB) and equity trading businesses, while dismal fixed-income trading performance and weakness in mortgage banking were disappointing. Consumer banking business improved, as reflected in the increase in usage of debit/credit cards.Reserve release by major banks (driven by improving economic outlook) supported the results. Overall, banks’ balance sheet and liquidity positions remained solid.On the other hand, as major banks continued to spend heavily on technology upgrades and undertook efforts to streamline operations, expenses rose during the quarter. Also, a rise in compensation and benefit costs led to higher costs. Further, management commentary surrounding expenses disappointed investors, leading to a pessimistic stance.This, along with bearish sentiments across the broader markets, weighed heavily on major banks’ share price movement over the past four trading sessions.Image Source: Zacks Investment Research(See the last bank stock roundup here: Bank Stock Roundup for the Week Ending Dec 24, 2021)Re-cap of the Week’s Important Earnings1. Robust advisory business, reserve release and a rise in loan demand drove JPMorgan’s fourth-quarter 2021 earnings of $3.33 per share. The bottom line handily outpaced the Zacks Consensus Estimate of $3.01. Results included net credit reserve releases. Excluding this, earnings came in at $2.86 per share.However, disappointing trading performance, lower interest rates and an increase in operating expenses were the major headwinds for JPMorgan’s quarterly results. Also, the company’s mortgage fees and related income plunged during the quarter.2. Citigroup delivered an earnings surprise of 5.04% in fourth-quarter 2021. Income from continuing operations per share of $1.46 beat the Zacks Consensus Estimate of $1.39. However, the reported figure declined 24% from the prior-year quarter.Citigroup’s investment banking revenues jumped, driven by equity underwriting and growth in advisory revenues. The dismal consumer banking business and higher operating expenses were the major headwinds.3. Wells Fargo’s fourth-quarter 2021 earnings per share of $1.38 surpassed the Zacks Consensus Estimate of 1.09. Also, the bottom line improved 86% year over year. Results included certain non-recurring items.Improved IB and other asset-based fees and strong equity gains in WFC’s affiliated venture capital and private equity businesses, as well as lower costs, supported the bank’s performance. Yet, a decline in NII due to low yields from earning assets and lower loans were the undermining factors.4. Bank of America’s fourth-quarter 2021 earnings of 82 cents per share beat the Zacks Consensus Estimate of 76 cents. The bottom line compared favorably with 59 cents earned in the prior-year quarter. Results in the quarter included a net reserve release of $851 million.Solid improvement in the lending scenario, consumer spending and economic rebound supported Bank of America’s NII growth. Further, robust IB performance and asset management business acted as tailwinds. However, trading numbers were not so impressive.5. PNC Financial pulled off a fourth-quarter 2021 earnings surprise of 1.94% on substantial recapturing of credit losses. Earnings per share, as adjusted (excluding pre-tax integration costs related to the BBVA USA acquisition), of $3.68 surpassed the Zacks Consensus Estimate of $3.61 and improved 12.5% year over year.Fee income growth on higher asset management revenues and corporate services supported PNC Financial’s results. However, higher expenses, margin contraction and a decline in loans were the headwinds.Price PerformanceHere is how the seven major stocks performed: Image Source: Zacks Investment ResearchOver the past four trading sessions, shares of U.S. Bancorp plunged 10%, while that of PNC Financial tanked 6.9%.What’s Next in the Banking Space?Over the next five trading days, the earnings season will continue full-fledged, with a number of banks coming out with their quarterly numbers. Also, investors will watch for clues on the timing of interest rate hikes at the end of the two-day FOMC meeting, which is scheduled on Jan 25-26. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Bank of America Corporation (BAC): Free Stock Analysis Report Wells Fargo & Company (WFC): Free Stock Analysis Report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Citigroup Inc. (C): Free Stock Analysis Report The PNC Financial Services Group, Inc (PNC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

Bank OZK (OZK) Beats on Q4 Earnings as Revenues Rise Y/Y

Bank OZK (OZK) records a year-over-year increase in revenues and expenses in the fourth quarter of 2021. Bank OZK’s OZK fourth-quarter 2021 earnings per share of $1.17 surpassed the Zacks Consensus Estimate of 98 cents. The bottom line reflects growth of 25.8% from the year-earlier quarter’s number.Results were aided by an improvement in revenues, partly offset by higher expenses. The company also recorded provision benefits in the quarter, which was a major tailwind.Net income available to common shareholders was $149.8 million, up 24.3% from the year-ago quarter.For 2021, earnings per share of $4.47 surpassed the Zacks Consensus Estimate of $4.28. The bottom line reflects growth of 97.8% from 2020. Net income available to common shareholders was $579 million, up 98.4% from the previous year.Revenues Improve, Expenses RiseQuarterly net revenues were $296.1 million, up 11.2% year over year. The top line surpassed the Zacks Consensus Estimate of $273 million.Net revenues for 2021 were $1.11 billion, up 11.3% year over year. The top line surpassed the Zacks Consensus Estimate of $1.08 billion.Quarterly net interest income was $266.4 million, up 12.1% year over year. Net interest margin, on a fully-taxable-equivalent basis, grew 53 basis points (bps) to 4.41%.Non-interest income was $29.7 million, up 3.6% from the year-ago quarter. The rise was due to an increase in almost all fee income components, except for gains on sales of other assets, loan service, maintenance and other fees, and increase in cash surrender value.Non-interest expenses were $110.1 million, up 6.5%. The rise was due to an increase in almost all cost components except for deposit insurance and assessments, telecommunication services, write-downs of foreclosed and other assets, and amortization of intangibles.Bank OZK’s efficiency ratio was 37.06%, down from 38.61% in the prior-year quarter. A fall in the efficiency ratio indicates an improvement in profitability.As of Dec 31, 2021, net loans were $18.09 billion, down from $18.91 billion recorded as of Dec 31, 2020. As of the same date, total deposits amounted to $20.21 billion, down from $21.45 billion at the end of December 2020.Credit Quality ImprovesThe ratio of non-performing loans, as a percentage of total loans, contracted 6 bps year over year to 0.19% as of Dec 31, 2021.In the reported quarter, the company recorded a provision benefit of $8 million against provision for credit losses of $6.8 million in the year-ago quarter. Net charge-off ratio to average total loans decreased 10 bps year over year to 0.04%.Profitability Ratios ImproveAt the end of the fourth quarter, return on average assets was 2.25%, up from 1.79% in the year-earlier quarter. Return on average common equity was 13.08%, up from 11.36%.Share Repurchase UpdateIn the reported quarter, Bank OZK repurchased 3,387,421 shares for $156.4 million.Our TakeBank OZK’s solid loan balance, along with its business restructuring and branch consolidation initiatives, are expected to continue aiding revenue growth. However, operating expenses are likely to stay elevated on the back of the bank’s efforts to improve technology and invest in franchise, which will likely hurt profits.Bank OZK Price, Consensus and EPS Surprise  Bank OZK price-consensus-eps-surprise-chart | Bank OZK QuoteBank OZK currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Performance of Large BanksRobust advisory business, reserve releases and a rise in loan demand drove JPMorgan’s JPM fourth-quarter 2021 earnings of $3.33 per share. The bottom line handily outpaced the Zacks Consensus Estimate of $3.01. Results included net credit reserve releases. Excluding this, earnings were $2.86 per share.JPM’s equity markets revenues and fixed-income markets revenues fell 2% and 16%, respectively, on a year-over-year basis. Total markets revenues of $5.3 billion declined 11%. While lower rates continued to hurt JPMorgan’s interest income, it was more than offset by a rise in loan balances.Bank of New York Mellon Corporation’s BK fourth-quarter 2021 adjusted earnings of $1.04 per share surpassed the Zacks Consensus Estimate of $1.02. The bottom line represents a rise of 8.3% from the prior-year quarter.BK's quarterly results were aided by provision benefits and a rise in fee income. Growth in asset balances was another tailwind. However, a marginal fall in net interest income and higher expenses were the undermining factors.Citigroup C delivered an earnings surprise of 5.04% in fourth-quarter 2021. Income from continuing operations per share of $1.46 handily outpaced the Zacks Consensus Estimate of $1.39. However, the reported figure declined 24% from the prior-year quarter.Citigroup’s investment banking revenues jumped in the quarter under review, driven by equity underwriting as well as growth in advisory revenues. However, fixed-income revenues were down due to declining rates and spread products. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report JPMorgan Chase & Co. (JPM): Free Stock Analysis Report Citigroup Inc. (C): Free Stock Analysis Report The Bank of New York Mellon Corporation (BK): 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: zacksJan 21st, 2022

Schlumberger (SLB) Q4 Earnings & Revenues Beat Estimates

Higher contributions from Europe/CIS/Africa and strong North America rig activities aid Schlumberger's (SLB) Q4 earnings. Schlumberger Limited SLB has announced fourth-quarter 2021 earnings of 41 cents per share (excluding charges and credits), which beat the Zacks Consensus Estimate of 39 cents. The bottom line significantly increased from the year-ago quarter’s earnings of 22 cents.The oilfield service giant recorded total revenues of $6,225 million, outpacing the Zacks Consensus Estimate of $6,094 million. The top line also improved 12.5% from the year-ago quarter’s $5,532 million.The strong quarterly earnings resulted from higher contributions from Europe/CIS/Africa, strong North America rig activity and increased well construction activities in the U.S. Gulf of Mexico.Segmental PerformanceRevenues in the Digital & Integration unit totaled $889 million, up 7% from the year-ago quarter’s levels. Pre-tax operating income of $335 million was up 25% year over year. The outperformance resulted from higher contributions from Europe/CIS/Africa, and increased sales in offshore North America and the Permian. The positives were partially offset by lower contributions from the Asset Performance Solutions (APS) projects.Revenues in the Reservoir Performance unit increased 3% year over year to $1,287 million. Pre-tax operating income was $200 million, surging 111% year over year. The upside in profit was led by a surge in stimulation activities in the Middle East & Asiaalong with higher intervention activities across the international offshore markets, particularly in the U.K. and Latin America.Revenues in the Well Construction segment rose 28% from the year-earlier quarter’s level to $2,388 million. Pre-tax operating income improved 101% year over year to $368 million. Strong North America rig activities and increased well construction activities in the U.S. Gulf of Mexicoaided the segment.Revenues in the Production Systems segment amounted to $1,765 million, up 7% from the year-ago quarter’s numbers. Pre-tax operating income rose 3% from the prior-year quarter’s levels to $159 million. Increased revenues in subsea, well production, and midstream production systems were responsible for the improvements. This was offset partially by a decline in revenues in surface production systems.Cash FlowDespite the company’s $22 million of severance payments through the December-end quarter, the oilfield service firm generated a free cash flow of $1.3 billion.FinancialsCapital expenditure in the quarter was $447 million. As of Dec 31, 2021, the company had approximately $3,139 million in cash and short-term investments. It had long-term debt of $13,286 million at the end of the fourth quarter, representing a debt to capitalization of 48.2%.Forward ViewFor 2022, Schlumberger projects a capital investment of $1.9-$2 billion.  Last year, the figure was $1.7 billion.Fuel demand has improved drastically, so has oil price, owing to the roll-out of coronavirus vaccines at a massive scale. The company expects the trend to continue for the next few years, which will drive upstream investment, especially in international resources. Being a leading player in the oilfield service space, the company expects to capitalize on the improving demand for oilfield services.Zacks Rank & Stock to ConsiderThe company currently carries a Zacks Rank #3 (Hold).Investors interested in the energy sector might look at the following companies that presently flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.BP plc BP, based in London, the U.K., is a fully integrated energy company, with a strong focus on renewable energy. BP has a strong portfolio of upstream projects, which has been backing impressive production growth. BP announced that before declaring results for the December-end quarter, it has intended to execute an additional $1.25 billion of share repurchases. The company continues to anticipate buying back $1 billion worth of shares by every quarter, considering Brent crude price at $60 per barrel. On the dividend front, the company projects a hike in the annual dividend per ordinary share of 4% through 2025.Royal Dutch Shell plc (RDS.A) is a fully integrated energy company, as it participates in every aspect related to energy, from oil production to refining and marketing. As of 2020 end, Shell likely had proved reserves of 9.1 billion oil-equivalent barrels.The BG acquisition has made Shell the largest liquefied natural gas (or LNG) producer in the world. With LNG demand likely to rise significantly in the near-to-medium term, Shell’s position as a major supplier of LNG should help meet the fuel’s growing demand and improve the cash flow.Eni SPA E is among the leading integrated energy players in the world. Its upstream operations involve the exploitation and production of oil and natural gas resources. Through midstream activities, the company transports and stores hydrocarbons. Eni also engages in refining hydrocarbons and distributing the end products in 71 nations. Apart from providing natural gas, the company generates and sells electricity.Eni currently has a Zacks Style score of A for Momentum, and B for Value and Growth. Eni beat the Zacks Consensus Estimate three times in the last four quarters and missed once, with an earnings surprise of 0.43%, on average. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report BP p.l.c. (BP): Free Stock Analysis Report Schlumberger Limited (SLB): Free Stock Analysis Report Royal Dutch Shell PLC (RDS.A): Free Stock Analysis Report Eni SpA (E): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

Cintas (CTAS) Down 12.6% Since Last Earnings Report: Can It Rebound?

Cintas (CTAS) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues. A month has gone by since the last earnings report for Cintas (CTAS). Shares have lost about 12.6% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Cintas due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts. Cintas Beats Q2 Earnings & Sales Estimates, Raises ViewCintas delivered better-than-expected results for the second quarter of fiscal 2022 (ended Nov 30, 2021). Its earnings surpassed the Zacks Consensus Estimate by 5.34%.The company's earnings in the reported quarter were $2.76 per share, surpassing the Zacks Consensus Estimate of $2.62. On a year-over-year basis, the bottom line increased 5.3% from the year-ago figure of $2.62. The impacts of the sales increase were partially offset by higher costs and expenses.Excluding the impacts of 25 cents per share of pre-tax gain recorded in second-quarter fiscal 2021, the company's reported quarter's earnings reflect a year-over-year increase of 16.5%.Revenue DetailsIn the quarter under review, Cintas' net sales were $1,922.3 million, reflecting growth of 9.4% from the year-ago quarter. Organic sales in the reported quarter were up 9.3% year over year. The top line surpassed the Zacks Consensus Estimate by 0.86%.The company has two reportable segments — Uniform Rental and Facility Services, and First Aid and Safety Services. Other businesses like Uniform Direct Sale and Fire Protection Services are included in All Other. Quarterly sales data is briefly discussed below.Revenues from the Uniform Rental and Facility Services segment (representing 79.9% of the reported quarter's net sales) were $1,535.3 million, increasing 8.8% year over year.Revenues from the First Aid and Safety Services segment (representing 10.5% of the reported quarter's net sales) totaled $202.2 million, increasing 4% year over year.Revenues from the All Other business (representing 9.6% of the reported quarter's net sales) were $184.9 million, increasing 21.5% year over year.Margin ProfileIn the quarter under review, Cintas' cost of sales (comprising costs related to uniform rental and facility services as well as others) increased 10.7% year over year to $1,037.1 million. It represented 54% of net sales. Gross profit in the reported quarter increased 8% year over year to $885.1 million. The gross margin was 46%, down from 46.7% in the year-ago quarter. High labor and energy expenses played spoilsports in the quarter.Selling and administrative expenses totaled $503.9 million, reflecting a 7.9% increase from the year-ago figure. It represented 26.2% of net sales. The operating margin (adjusted) in the reported quarter increased 70 bps year over year to 19.8%. Interest expenses decreased 10.8% to $21.9 million.Balance Sheet and Cash FlowExiting the fiscal second quarter, Cintas had cash and cash equivalents of $113.2 million, up 42% from $79.7 million at the end of the previous quarter. Long-term debt was $1,343.4 million, reflecting no change from the previous quarter.In the first half of fiscal 2022, the company repaid debts of $250 million.In the first half of fiscal 2021, it generated net cash of $593.8 million from operating activities, increasing 3.6% from the year-ago period. Capital expenditure totaled $108.6 million, reflecting a year-over-year increase of 88.4%. Free cash flow decreased 5.9% year over year to $485.2 million.In the six months of the fiscal year, the company repurchased shares worth $664.7 million, up from $71.4 million used in the year-ago period. Dividend payments totaled $177.9 million in the first half of this fiscal year.OutlookFor fiscal 2022 (ending May 2022), Cintas anticipates revenues of $7.63-$7.70 billion, higher than $7.58-$7.67 billion stated earlier. The company expects earnings per share of $10.70-$10.95 compared with $10.60-$10.90 mentioned earlier.The tax rate for the fiscal year is expected to be 19%, indicating an increase from 13.7% recorded in fiscal 2021. High taxes are likely to lower earnings by 72 cents per share and affect year-over-year earnings growth by 700 bps.How Have Estimates Been Moving Since Then?In the past month, investors have witnessed a downward trend in fresh estimates.VGM ScoresAt this time, Cintas has an average Growth Score of C, however its Momentum Score is doing a bit better with a B. Charting a somewhat similar path, the stock was allocated a grade of C on the value side, putting it in the middle 20% for this investment strategy.Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Cintas has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Cintas Corporation (CTAS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

What Makes Fulton Financial (FULT) a Strong Momentum Stock: Buy Now?

Does Fulton Financial (FULT) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Fulton Financial (FULT), a company that currently holds a Momentum Style Score of B. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Fulton Financial currently has a Zacks Rank of #1 (Strong Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if FULT is a promising momentum pick, let's examine some Momentum Style elements to see if this financial holding company holds up.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For FULT, shares are up 3.28% over the past week while the Zacks Banks - Northeast industry is up 0.08% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 6.38% compares favorably with the industry's 1.18% performance as well.While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of Fulton Financial have risen 10.76%, and are up 26.37% in the last year. In comparison, the S&P 500 has only moved -0.89% and 17.95%, respectively.Investors should also take note of FULT's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, FULT is averaging 856,215 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with FULT.Over the past two months, 5 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost FULT's consensus estimate, increasing from $1.30 to $1.41 in the past 60 days. Looking at the next fiscal year, 1 estimate has moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that FULT is a #1 (Strong Buy) stock and boasts a Momentum Score of B. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Fulton Financial on your short list. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Fulton Financial Corporation (FULT): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

Commercial Metals (CMC) Is Up 6.49% in One Week: What You Should Know

Does Commercial Metals (CMC) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Commercial Metals (CMC), which currently has a Momentum Style Score of A. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Commercial Metals currently has a Zacks Rank of #1 (Strong Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if CMC is a promising momentum pick, let's examine some Momentum Style elements to see if this manufacturer and recycler of steel and metal products holds up.Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For CMC, shares are up 6.49% over the past week while the Zacks Steel - Producers industry is up 2.81% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 1.34% compares favorably with the industry's 6.42% performance as well.While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of Commercial Metals have risen 11.16%, and are up 69.04% in the last year. In comparison, the S&P 500 has only moved -0.89% and 17.95%, respectively.Investors should also take note of CMC's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, CMC is averaging 896,018 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with CMC.Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost CMC's consensus estimate, increasing from $4.10 to $5.72 in the past 60 days. Looking at the next fiscal year, 1 estimate has moved upwards while there have been no downward revisions in the same time period.Bottom LineTaking into account all of these elements, it should come as no surprise that CMC is a #1 (Strong Buy) stock with a Momentum Score of A. If you've been searching for a fresh pick that's set to rise in the near-term, make sure to keep Commercial Metals on your short list. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Commercial Metals Company (CMC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

Here"s Why Momentum Investors Will Love Tenaris S.A. (TS)

Does Tenaris S.A. (TS) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Tenaris S.A. (TS), a company that currently holds a Momentum Style Score of A. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Tenaris S.A. Currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if TS is a promising momentum pick, let's examine some Momentum Style elements to see if this company holds up.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For TS, shares are up 6.2% over the past week while the Zacks Steel - Pipe and Tube industry is up 2.51% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 15.67% compares favorably with the industry's 9.12% performance as well.Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Shares of Tenaris S.A. Have increased 5.89% over the past quarter, and have gained 51.39% in the last year. On the other hand, the S&P 500 has only moved -0.89% and 17.95%, respectively.Investors should also pay attention to TS's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. TS is currently averaging 1,864,705 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with TS.Over the past two months, 2 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost TS's consensus estimate, increasing from $1.63 to $1.68 in the past 60 days. Looking at the next fiscal year, 3 estimates have moved upwards while there have been 1 downward revision in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that TS is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Tenaris S.A. On your short list. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Tenaris S.A. (TS): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 21st, 2022

Here"s Why Momentum Investors Will Love Patterson-UTI (PTEN)

Does Patterson-UTI (PTEN) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Patterson-UTI (PTEN), a company that currently holds a Momentum Style Score of A. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Patterson-UTI currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if PTEN is a promising momentum pick, let's examine some Momentum Style elements to see if this provider of onshore contract drilling services holds up.Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For PTEN, shares are up 6.95% over the past week while the Zacks Oil and Gas - Drilling industry is up 6.34% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 12% compares favorably with the industry's 12% performance as well.Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Shares of Patterson-UTI have increased 7.81% over the past quarter, and have gained 64.43% in the last year. On the other hand, the S&P 500 has only moved -0.89% and 17.95%, respectively.Investors should also take note of PTEN's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, PTEN is averaging 2,161,415 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with PTEN.Over the past two months, 2 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost PTEN's consensus estimate, increasing from -$1.91 to -$1.90 in the past 60 days. Looking at the next fiscal year, 6 estimates have moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that PTEN is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Patterson-UTI on your short list. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report PattersonUTI Energy, Inc. (PTEN): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksJan 21st, 2022

ConnectOne Bancorp (CNOB) is a Great Momentum Stock: Should You Buy?

Does ConnectOne Bancorp (CNOB) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at ConnectOne Bancorp (CNOB), which currently has a Momentum Style Score of A. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. ConnectOne Bancorp currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?Let's discuss some of the components of the Momentum Style Score for CNOB that show why this holding company for ConnectOne Bank shows promise as a solid momentum pick.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area.For CNOB, shares are up 3.97% over the past week while the Zacks Banks - Northeast industry is up 0.08% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 9.58% compares favorably with the industry's 1.18% performance as well.While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of ConnectOne Bancorp have risen 6.12%, and are up 66.6% in the last year. In comparison, the S&P 500 has only moved -0.89% and 17.95%, respectively.Investors should also pay attention to CNOB's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. CNOB is currently averaging 136,464 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with CNOB.Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost CNOB's consensus estimate, increasing from $3.20 to $3.21 in the past 60 days. Looking at the next fiscal year, 1 estimate has moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that CNOB is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep ConnectOne Bancorp on your short list. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2021. Previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report ConnectOne Bancorp, Inc. (CNOB): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksJan 21st, 2022

Washington Federal (WAFD) Q1 Earnings Beat Estimates, Stock Up

Higher revenues, strong balance sheet and robust loans support Washington Federal's (WAFD) fiscal Q1 results. However, an increase in expenses is a major headwind. Shares of Washington Federal WAFD gained nearly 1% in after-hours in response to the announcement of its first-quarter fiscal 2022 (ended Dec 31) results. Earnings of 71 cents per share surpassed the Zacks Consensus Estimate of 69 cents. The figure reflects a year-over-year jump of 39%.Results primarily benefited from increased revenues, decreased provision for credit losses and a robust loan balance. The company’s balance-sheet position remained strong during the quarter. However, an increase in expenses was the undermining factor.Net income was $50.3 million, surging 29.1% from the prior-year period.Revenues & Expenses RiseNet revenues were $152.8 million, up 13.7% from the year-ago quarter. The top line beat the Zacks Consensus Estimate of $147.8 million.Net interest income was $134.1 million, up 11.3% from the year-earlier period. Net interest margin was 2.87%, rising 12 basis points.Total other income of $18.7 million soared 34.5%. This jump was mainly driven by a drastic improvement in other income and higher deposit fee income.Other expenses amounted to $89.6 million, up 10.1% year over year. Higher compensation and benefits, occupancy and other expenses largely led to this rise.The company’s efficiency ratio was 58.64%, down from 60.58% recorded a year ago. A fall in efficiency ratio indicates improved profitability.At the end of the fiscal first quarter, return on average common equity was 10.12%, up from the 7.65% witnessed at the end of the year-earlier quarter. Return on average assets was 1.02%, up from 0.83%.Loans and Deposit RiseAs of Dec 31, 2021, net loans receivables amounted to $14.6 billion, up 5.5% sequentially. Also, total customer deposits were $15.9 billion, up 2.3% from Sep 30, 2021.Credit Quality ImprovesAs of Dec 31, 2021, the allowance for credit losses (including reserve for unfunded commitments) was 1.18% of gross loans outstanding, down from 1.22% recorded on Sep 30, 2021. The ratio of non-performing assets to total assets was 0.27% compared with 0.22% as on Sep 30, 2021.During the quarter, the company recorded a provision for credit losses of $0.5 million, substantially lower than $3 million in the prior-year quarter.Share Repurchase UpdateDuring the quarter, Washington Federal repurchased 84,114 shares at an average price of $35.34 per share.Our ViewpointSolid loans and deposit balances along with strong credit quality will likely continue to support Washington Federal’s profitability. However, elevated operating expenses remain a major headwind. Washington Federal, Inc. Price, Consensus and EPS Surprise Washington Federal, Inc. price-consensus-eps-surprise-chart | Washington Federal, Inc. QuoteCurrently, Washington Federal carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Earnings Release & Expectations of Other BanksHancock Whitney Corporation HWC is scheduled to release fourth quarter and full-year 2021 results on Jan 18.Over the past 30 days, the Zacks Consensus Estimate for Hancock’s quarterly earnings has moved 1.5% upward to $1.35. This indicates a 40.6% increase from the prior-year quarter.Associated Banc-Corp ASB is scheduled to release fourth quarter and full-year 2021 results on Jan 20.Over the past 30 days, the Zacks Consensus Estimate for Associated Banc-Corp’s quarterly earnings has remained unchanged at 43 cents. This implies a 7.5% increase from the prior-year quarter.Bank OZK OZK is scheduled to release fourth quarter and full-year 2021 results on Jan 20.Over the past 30 days, the Zacks Consensus Estimate for Bank OZK’s quarterly earnings has remained unchanged at 98 cents. Also, this suggests a 5.4% increase from the prior-year quarter. 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 5 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 Washington Federal, Inc. (WAFD): Free Stock Analysis Report Associated BancCorp (ASB): Free Stock Analysis Report Hancock Whitney Corporation (HWC): 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: zacksJan 14th, 2022

Houlihan Lokey (HLI) Is Up 7.53% in One Week: What You Should Know

Does Houlihan Lokey (HLI) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Houlihan Lokey (HLI), a company that currently holds a Momentum Style Score of A. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Houlihan Lokey currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?Let's discuss some of the components of the Momentum Style Score for HLI that show why this investment banking company shows promise as a solid momentum pick.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For HLI, shares are up 7.53% over the past week while the Zacks Financial - Miscellaneous Services industry is up 0.03% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 15.15% compares favorably with the industry's 0.49% performance as well.Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Over the past quarter, shares of Houlihan Lokey have risen 14.82%, and are up 65.06% in the last year. On the other hand, the S&P 500 has only moved 7.17% and 23.92%, respectively.Investors should also pay attention to HLI's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. HLI is currently averaging 403,105 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with HLI.Over the past two months, 3 earnings estimates moved higher compared to none lower for the full year. These revisions helped boost HLI's consensus estimate, increasing from $6.32 to $6.69 in the past 60 days. Looking at the next fiscal year, 2 estimates have moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that HLI is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Houlihan Lokey on your short list. 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 5 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 Houlihan Lokey, Inc. (HLI): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 14th, 2022

Are You Looking for a Top Momentum Pick? Why Ford Motor Company (F) is a Great Choice

Does Ford Motor Company (F) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.While many investors like to look for momentum in stocks, this can be very tough to define. There is a lot of debate surrounding which metrics are the best to focus on and which are poor quality indicators of future performance. The Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Ford Motor Company (F), a company that currently holds a Momentum Style Score of B. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Ford Motor Company currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if F is a promising momentum pick, let's examine some Momentum Style elements to see if this company holds up.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It's also helpful to compare a security to its industry; this can show investors the best companies in a particular area.For F, shares are up 17.67% over the past week while the Zacks Automotive - Domestic industry is down 2.33% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 22.95% compares favorably with the industry's 1.4% performance as well.Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Over the past quarter, shares of Ford Motor Company have risen 51.18%, and are up 146.02% in the last year. On the other hand, the S&P 500 has only moved 7.17% and 23.92%, respectively.Investors should also pay attention to F's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. F is currently averaging 104,483,528 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with F.Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost F's consensus estimate, increasing from $1.88 to $1.89 in the past 60 days. Looking at the next fiscal year, 1 estimate has moved upwards while there have been no downward revisions in the same time period.Bottom LineTaking into account all of these elements, it should come as no surprise that F is a #2 (Buy) stock with a Momentum Score of B. If you've been searching for a fresh pick that's set to rise in the near-term, make sure to keep Ford Motor Company on your short list. 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 5 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 To read this article on Zacks.com click here......»»

Category: topSource: zacksJan 14th, 2022

Howard Marks January 2022 Memo: Selling Out

Howard Marks memo to Oaktree clients for the month of January 2022, titled, “Selling Out.” Q4 2021 hedge fund letters, conferences and more As I’m now in my fourth decade of memo writing, I’m sometimes tempted to conclude I should quit, because I’ve covered all the relevant topics. Then a new idea for a memo […] Howard Marks memo to Oaktree clients for the month of January 2022, titled, “Selling Out.” 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 The Full Series in PDF Get the entire 10-part series on Charlie Munger in PDF. Save it to your desktop, read it on your tablet, or email to your colleagues. (function($) {window.fnames = new Array(); window.ftypes = new Array();fnames[0]='EMAIL';ftypes[0]='email';}(jQuery));var $mcj = jQuery.noConflict(true); Q4 2021 hedge fund letters, conferences and more As I’m now in my fourth decade of memo writing, I’m sometimes tempted to conclude I should quit, because I’ve covered all the relevant topics. Then a new idea for a memo pops up, delivering a pleasant surprise. My January 2021 memo Something of Value, which chronicled the time I spent in 2020 living and discussing investing with my son Andrew, recounted a semi-real conversation in which we briefly discussed whether and when to sell appreciated assets. It occurred to me that even though selling is an inescapable part of the investment process, I’ve never devoted an entire memo to it. The Basic Idea Everyone is familiar with the old saw that’s supposed to capture investing’s basic proposition: “buy low, sell high.” It’s a hackneyed caricature of the way most people view investing. But few things that are important can be distilled into just four words; thus, “buy low, sell high” is nothing but a starting point for discussion of a very complex process. Will Rogers, an American film star and humorist of the 1920s and ’30s, provided what he may have thought was a more comprehensive roadmap for success in the pursuit of wealth: Don’t gamble; take all your savings and buy some good stock and hold it till it goes up, then sell it. If it don’t go up, don’t buy it. The illogicality of his advice makes clear how simplistic this adage – like many others – really is. However, regardless of the details, people may unquestioningly accept that they should sell appreciated investments. But how helpful is that basic concept? Origins Much of what I’ll write here got its start in a 2015 memo called Liquidity. The hot topic in the investment world at that moment was the concern about a perceived decline in the liquidity provided by the market (when I say “the market,” I’m talking specifically about the U.S. stock market, but the statement has broad applicability). This was commonly attributed to a combination of (a) the licking investment banks had taken in the Global Financial Crisis of 2008-09 and (b) the Volcker Rule, which prohibited risky activities such as proprietary trading on the part of systemically important financial institutions. The latter constrained banks’ ability to “position” securities, or buy them, when clients wanted to sell. Maybe liquidity in 2015 was less than it had previously been, and maybe it wasn’t. However, looking beyond the events of the day, I closed that memo by stating my conviction that (a) most investors trade too much, to their own detriment, and (b) the best solution for illiquidity is to build portfolios for the long term that don’t rely on liquidity for success. Long-term investors have an advantage over those with short timeframes (and I think the latter describes the majority of market participants these days). Patient investors are able to ignore short-term performance, hold for the long run, and avoid excessive trading costs, while everyone else worries about what’s going to happen in the next month or quarter and therefore trades excessively. In addition, long-term investors can take advantage if illiquid assets become available for purchase at bargain prices. Like so many things in investing, however, just holding is easier said than done. Too many people equate activity with adding value. Here’s how I summed up this idea in Liquidity, inspired by something Andrew had said: When you find an investment with the potential to compound over a long period, one of the hardest things is to be patient and maintain your position as long as doing so is warranted based on the prospective return and risk. Investors can easily be moved to sell by news, emotion, the fact that they’ve made a lot of money to date, or the excitement of a new, seemingly more promising idea. When you look at the chart for something that’s gone up and to the right for 20 years, think about all the times a holder would have had to convince himself not to sell. Everyone wishes they’d bought Amazon at $5 on the first day of 1998, since it’s now up 660x at $3,304. But who would have continued to hold when the stock hit $85 in 1999 – up 17x in less than two years? Who among those who held on would have been able to avoid panicking in 2001, as the price fell 93%, to $6? And who wouldn’t have sold by late 2015 when it hit $600 – up 100x from the 2001 low? Yet anyone who sold at $600 captured only the first 18% of the overall rise from that low. This reminds me of the time I once visited Malibu with a friend and mentioned that the Rindge family is said to have bought the entire area – all 13,330 acres – in 1892 for $300,000, or $22.50 per acre. (It’s clearly worth many billions today.) My friend said, “I’d like to have bought all of Malibu for $300,000.” My response was simple: “you would have sold it when it got to $600,000.” The more I’ve thought about it since writing Liquidity, the more convinced I’ve become that there are two main reasons why people sell investments: because they’re up and because they’re down. You may say that sounds nutty, but what’s really nutty is many investors’ behavior. Selling Because It’s Up “Profit-taking” is the intelligent-sounding term in our business for selling things that have appreciated. To understand why people engage in it, you need insight into human behavior, because a lot of investors’ selling is motivated by psychology. In short, a good deal of selling takes place because people like the fact that their assets show gains, and they’re afraid the profits will go away. Most people invest a lot of time and effort trying to avoid unpleasant feelings like regret and embarrassment. What could cause an investor more self-recrimination than watching a big gain evaporate? And what about the professional investor who reports a big winner to clients one quarter and then has to explain why the holding is at or below cost the next? It’s only human to want to realize profits to avoid these outcomes. If you sell an appreciated asset, that puts the gain “in the books,” and it can never be reversed. Thus, some people consider selling winners extremely desirable – they love realized gains. In fact, at a meeting of a non-profit’s investment committee, a member suggested that they should be leery of increasing endowment spending in response to gains because those gains were unrealized. I was quick to point out that it’s usually a mistake to view realized gains as less transient than unrealized ones (assuming there’s no reason to doubt the veracity of the unrealized carrying values). Yes, the former have been made concrete. However, sales proceeds are generally reinvested, meaning the profits – and the principal – are put back at risk. One might argue that appreciated securities are more vulnerable to declines than new investments in assets currently deemed to be attractively priced, but that’s far from a certainty. I’m not saying investors shouldn’t sell appreciated assets and realize profits. But it certainly doesn’t make sense to sell things just because they’re up. Selling Because It’s Down As wrong as it is to sell appreciated assets solely to crystalize gains, it’s even worse to sell them just because they’re down. Nevertheless, I’m sure many people do it. While the rule is “buy low, sell high,” clearly many people become more motivated to sell assets the more they decline. In fact, just as continued buying of appreciated assets can eventually turn a bull market into a bubble, widespread selling of things that are down has the potential to turn market declines into crashes. Bubbles and crashes do occur, proving that investors contribute to excesses in both directions. In a movie that plays in my head, the typical investor buys something at $100. If it goes to $120, he says, “I think I’m onto something – I should add,” and if it reaches $150, he says, “Now I’m highly confident – I’m going to double up.” On the other hand, if it falls to $90, he says, “I’m going to think about increasing my position to reduce my average cost,” but at $75, he concludes he should reconfirm his thesis before averaging down further. At $50, he says, “I’d better wait for the dust to settle before buying more.” And at $20 he says, “It feels like it’s going to zero; get me out!” Just like those who are afraid of surrendering gains, many investors worry about letting losses compound. They might fear their clients will say (or they’ll say to themselves), “What kind of a lame-brain continues to hold a security after it’s gone from $100 to $50? Everyone knows a decline like that can foreshadow further declines. And look – it happened.” Do investors really make behavioral errors such as those I’ve described? There’s plenty of anecdotal evidence. For example, studies have shown that the average mutual fund investor performs worse than the average mutual fund. How can that be? If she merely held her positions, or if her errors were unsystematic, the average fund investor would, by definition, fare the same as the average fund. For the studies’ findings to occur, investors have to on balance reduce the amount of capital they have in funds that subsequently do better and increase their allocation to funds that go on to do worse. Let me put that another way: on average, mutual fund investors tend to sell the funds with the worst recent performance (missing out on their potential recoveries) in order to chase the funds that have done the best (and thus likely participate in their return to earth). We know that “retail investors” tend to be trend-followers, as described above, and their long-term performance often suffers as a result. What about the pros? Here the evidence is even clearer: the powerful shift in recent decades toward indexing and other forms of passive investing has taken place for the simple reason that active investment decisions are so often wrong. Of course, many forms of error contribute to this reality. Whatever the reason, however, we have to conclude that, on average, active professional investors held more of the things that did less well and less of the things that outperformed, and/or that they bought too much at elevated prices and sold too much at depressed prices. Passive investing hasn’t grown to cover the majority of U.S. equity mutual fund capital because passive results have been so good; I think it’s because active management has been so bad. Back when I worked at First National City Bank 50 years ago, prospective clients used to ask, “What kind of return do you think you can make in an equity portfolio?” The standard answer was 12%. Why? “Well,” we said (so simplistically), “the stock market returns about 10% a year. A little effort should enable us to improve on that by at least 20%.” Of course, as time has shown, there’s no truth in that. “A little effort” didn’t add anything. In fact, in most cases, active investing detracted: most equity funds failed to keep up with the indices, especially after fees. What about the ultimate proof? The essential ingredient in Oaktree’s investments in distressed debt – bargain purchases – has emanated from the great opportunities sellers gave us. Negativity reaches a crescendo during economic and market crises, causing many investors to become depressed or fearful and sell in panic. Results like those we target in distressed debt can only be achieved when holders sell to us at irrationally low prices. Superior investing consists largely of taking advantage of mistakes made by others. Clearly, selling things because they’re down is a mistake that can give the buyers great opportunities. When Should Investors Sell? If you shouldn’t sell things because they’re up, and you shouldn’t sell because they’re down, is it ever right to sell? As I previously mentioned, I described the discussions that took place while Andrew and his family lived with Nancy and me in 2020 in Something of Value. That experience truly was of great value – an unexpected silver lining to the pandemic. That memo evoked the strongest reaction from readers of any of my memos to date. This response was probably attributable to (a) the content, which mostly related to value investing; (b) the personal insights provided, and especially my confession regarding my need to grow with the times; or (c) the recreated conversation that I included as an appendix. The last of these went like this, in part: Howard: Hey, I see XYZ is up xx% this year and selling at a p/e ratio of xx. Are you tempted to take some profits? Andrew: Dad, I’ve told you I’m not a seller. Why would I sell? H: Well, you might sell some here because (a) you’re up so much; (b) you want to put some of the gain “in the books” to make sure you don’t give it all back; and (c) at that valuation, it might be overvalued and precarious. And, of course, (d) no one ever went broke taking a profit. A: Yeah, but on the other hand, (a) I’m a long-term investor, and I don’t think of shares as pieces of paper to trade, but as part ownership in a business; (b) the company still has enormous potential; and (c) I can live with a short-term downward fluctuation, the threat of which is part of what creates opportunities in stocks to begin with. Ultimately, it’s only the long term that matters. (There’s a lot of “a-b-c” in our house. I wonder where Andrew got that.) H: But if it’s potentially overvalued in the short term, shouldn’t you trim your holding and pocket some of the gain? Then if it goes down, (a) you’ve limited your regret and (b) you can buy in lower. A: If I owned a stake in a private company with enormous potential, strong momentum and great management, I would never sell part of it just because someone offered me a full price. Great compounders are extremely hard to find, so it’s usually a mistake to let them go. Also, I think it’s much more straightforward to predict the long-term outcome for a company than short-term price movements, and it doesn’t make sense to trade off a decision in an area of high conviction for one about which you’re limited to low conviction. . . . H: Isn’t there any point where you’d begin to sell? A: In theory there is, but it largely depends on (a) whether the fundamentals are playing out as I hope and (b) how this opportunity compares to the others that are available, taking into account my high level of comfort with this one. Aphorisms like “no one ever went broke taking a profit” may be relevant to people who invest part-time for themselves, but they should have no place in professional investing. There certainly are good reasons for selling, but they have nothing to do with the fear of making mistakes, experiencing regret and looking bad. Rather, these reasons should be based on the outlook for the investment – not the psyche of the investor – and they have to be identified through hardheaded financial analysis, rigor and discipline. Stanford University professor Sidney Cottle was the editor of the later versions of Benjamin Graham and David L. Dodd’s Security Analysis, “the bible of value investing,” including the edition I read at Wharton 56 years ago. For that reason, I knew the book as “Graham, Dodd and Cottle.” Sid was a consultant to the investment department at First National City Bank in the 1970s, and I’ve never forgotten his description of investing: “the discipline of relative selection.” In other words, most of the portfolio decisions investors make are relative choices. It’s patently clear that relative considerations should play an enormous part in any decision to sell existing holdings. If your investment thesis seems less valid than it did previously and/or the probability that it will prove accurate has declined, selling some or all of the holding is probably appropriate. Likewise, if another investment comes along that appears to have more promise – to offer a superior risk-adjusted prospective return – it’s reasonable to reduce or eliminate existing holdings to make room for it. Selling an asset is a decision that must not be considered in isolation. Cottle’s concept of “relative selection” highlights the fact that every sale results in proceeds. What will you do with them? Do you have something in mind that you think might produce a superior return? What might you miss by switching to the new investment? And what will you give up if you continue to hold the asset in your portfolio rather than making the change? Or perhaps you don’t plan to reinvest the proceeds. In that case, what’s the likelihood that holding the proceeds in cash will make you better off than you would have been if you had held onto the thing you sold? Questions like these relate to the concept of “opportunity cost,” one of the most important ideas in financial decision-making. Switching gears, what about the idea of selling because you think a temporary dip lies ahead that will affect one of your holdings or the whole market? There are real problems with this approach: Why sell something you think has a positive long-term future to prepare for a dip you expect to be temporary? Doing so introduces one more way to be wrong (of which there are so many), since the decline might not occur. Charlie Munger, vice chairman of Berkshire Hathaway, points out that selling for market-timing purposes actually gives an investor two ways to be wrong: the decline may or may not occur, and if it does, you’ll have to figure out when the time is right to go back in. Or maybe it’s three ways, because once you sell, you also have to decide what to do with the proceeds while you wait until the dip occurs and the time comes to get back in. People who avoid declines by selling too often may revel in their brilliance and fail to reinstate their positions at the resulting lows. Thus, even sellers who were right can fail to accomplish anything of lasting value. Lastly, what if you’re wrong and there is no dip? In that case, you’ll miss out on the ensuing gains and either never get back in or do so at higher prices. So it’s generally not a good idea to sell for purposes of market timing. There are very few occasions to do so profitably and very few people who possess the skill needed to take advantage of these opportunities. Before I close on this subject, it’s important to note that decisions to sell aren’t always within an investment manager’s control. Clients can withdraw capital from accounts and funds, necessitating sales, and the limited lifespan of closed-end funds can require managers to liquidate holdings even though they’re not ripe for selling. The choice of what to sell under these conditions can still be based on a manager’s expectations regarding future returns, but deciding not to sell isn’t among the manager’s choices. How Much Is Too Much to Hold? Certainly there are times when it’s right to sell one asset in favor of another based on the idea of relative selection. But we mustn’t do this in a mechanical manner. If we did, at the logical extreme, we would put all of our capital into the one investment we consider the best. Virtually all investors – even the best – diversify their portfolios. We may have a sense for which holding is the absolute best, but I’ve never heard of an investor with a one-asset portfolio. They may overweight favorites to take advantage of what they think they know, but they still diversify to protect against what they don’t know. That means they sub-optimize, potentially trading off some of their chance at a maximal return to increase the likelihood of a merely excellent one. Here’s a related question from my reconstructed conversation with Andrew: H: You run a concentrated portfolio. XYZ was a big position when you invested, and it’s even bigger today, given the appreciation. Intelligent investors concentrate portfolios and hold on to take advantage of what they know, but they diversify holdings and sell as things rise to limit the potential damage from what they don’t know. Hasn’t the growth in this position put our portfolio out of whack in that regard? A: Perhaps that’s true, depending on your goals. But trimming would mean selling something I feel immense comfort with based on my bottom-up assessment and moving into something I feel less good about or know less well (or cash). To me, it’s far better to own a small number of things about which I feel strongly. I’ll only have a few good insights over my lifetime, so I have to maximize the few I have. All professional investors want good investment performance for their clients, but they also want financial success for themselves. And amateurs have to invest within the limits of their risk tolerance. For these reasons, most investors – and certainly most investment managers’ clients – aren’t immune to apprehension regarding portfolio concentration and thus susceptibility to untoward developments. These considerations introduce valid reasons for limiting the size of individual asset purchases and trimming positions as they appreciate. Investors sometimes delegate the decision on how to weight assets in portfolios to a process called portfolio optimization. Inputs regarding asset classes’ return potential, risk and correlation are fed into a computer model, and out comes the portfolio with the optimal expected risk-adjusted return. If an asset appreciates relative to the others, the model can be rerun, and it will tell you what to buy and sell. The main problem with these models lies in the fact that all the data we have regarding those three parameters relates to the past, but to arrive at the ideal portfolio, the model needs data that accurately describes the future. Further, the models need a numerical input for risk, and I absolutely insist that no single number can fully describe an asset’s risk. Thus, optimization models can’t successfully dictate portfolio actions. The bottom line: we should base our investment decisions on our estimates of each asset’s potential, we shouldn’t sell just because the price has risen and the position has swelled, there can be legitimate reasons to limit the size of the positions we hold, but there’s no way to scientifically calculate what those limits should be. In other words, the decision to trim positions or to sell out entirely comes down to judgment . . . like everything else that matters in investing. The Final Word on Selling Most investors try to add value by over- and underweighting specific assets and/or through well-timed buying and selling. While few have demonstrated the ability to consistently do these things correctly (see my comments on active management on page 4), everyone’s free to have a go at it. There is, however, a big “but.” What’s clear to me is that simply being invested is by far “the most important thing.” (Someone should write a book with that title!) Most actively managed portfolios won’t outperform the market as a result of manipulation of portfolio weightings or buying and selling for purposes of market timing. You can try to add to returns by engaging in such machinations, but these actions are unlikely to work at best and can get in the way at worst. Most economies and corporations benefit from positive underlying secular trends, and thus most securities markets rise in most years and certainly over long periods. One of the longest-running U.S. equity indices, the S&P 500, has produced an estimated compound average return over the last 90 years of 10.5% per year. That’s startling performance. It means $1 invested in the S&P 500 90 years ago would have grown to roughly $8,000 today. Many people have remarked on the wonders of compounding. For example, Albert Einstein reportedly called compound interest “the eighth wonder of the world.” If $1 could be invested today at the historic compound return of 10.5% per year, it would grow to $147 in 50 years. One might argue that economic growth will be slower in the years ahead than it was in the past, or that bargain stocks were easier to find in previous periods than they are today. Nevertheless, even if it compounds at just 7%, $1 invested today will grow to over $29 in 50 years. Thus, someone entering adulthood today is practically guaranteed to be well fixed by the time they retire if they merely start investing promptly and avoid tampering with the process by trading. I like the way Bill Miller, one of the great investors of our time, put it in his 3Q 2021 Market Letter: In the post-war period the US stock market has gone up in around 70% of the years... Odds much less favorable than that have made casino owners very rich, yet most investors try to guess the 30% of the time stocks decline, or even worse spend time trying to surf, to no avail, the quarterly up and down waves in the market. Most of the returns in stocks are concentrated in sharp bursts beginning in periods of great pessimism or fear, as we saw most recently in the 2020 pandemic decline. We believe time, not timing, is the key to building wealth in the stock market. (October 18, 2021. Emphasis added) What are the “sharp bursts” Miller talks about? On April 11, 2019, The Motley Fool cited data from JP Morgan Asset Management’s 2019 Retirement Guide showing that in the 20-year period between 1999 and 2018, the annual return on the S&P 500 was 5.6%, but your return would only have been 2.0% if you had sat out the 10 best days (or roughly 0.4% of the trading days), and you wouldn’t have made any money at all if you had missed the 20 best days. In the past, returns have often been similarly concentrated in a small number of days. Nevertheless, overactive investors continue to jump in and out of the market, incurring transactions costs and capital gains taxes and running the risk of missing those “sharp bursts.” As mentioned earlier, investors often engage in selling because they believe a decline is imminent and they have the ability to avoid it. The truth, however, is that buying or holding – even at elevated prices – and experiencing a decline is in itself far from fatal. Usually, every market high is followed by a higher one and, after all, only the long-term return matters. Reducing market exposure through ill-conceived selling – and thus failing to participate fully in the markets’ positive long-term trend – is a cardinal sin in investing. That’s even more true of selling without reason things that have fallen, turning negative fluctuations into permanent losses and missing out on the miracle of long-term compounding. * * * When I meet people for the first time and they find out I’m in the investment business, they often ask (especially in Europe) “what do you trade?” That question makes me bristle. To me, “trading” means jumping in and out of individual assets and whole markets on the basis of guesswork as to what prices will do in the next hour, day, month or quarter. We don’t engage in such activity at Oaktree, and few people have demonstrated the ability to do it well. Rather than traders, we consider ourselves investors. In my view, investing means committing capital to assets based on well-reasoned estimates of their potential and benefitting from the results over the long term. Oaktree does employ people called traders, but their job consists of implementing long-term investment decisions made by portfolio managers based on assets’ fundamentals. No one at Oaktree believes they can make money or advance their career by selling now and buying back after an intervening decline, as opposed to holding for years and letting value lift prices if fundamental expectations prove out. When Oaktree was formed in 1995, the five founders – who at that point had worked together for nine years on average – established an investment philosophy based on what we’d successfully done in that time. One of the six tenets expressed our view on trying to time markets when buying and selling: Because we do not believe in the predictive ability required to correctly time markets, we keep portfolios fully invested whenever attractively priced assets can be bought. Concern about the market climate may cause us to tilt toward more defensive investments, increase selectivity or act more deliberately, but we never move to raise cash. Clients hire us to invest in specific market niches, and we must never fail to do our job. Holding investments that decline in price is unpleasant, but missing out on returns because we failed to buy what we were hired to buy is inexcusable. We’ve never changed any of the six tenets of our investment philosophy – including this one – and we have no plans to do so. January 13, 2022 Updated on Jan 14, 2022, 12:38 pm (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: valuewalkJan 14th, 2022

Discover Financial (DFS) Up 10.6% in Past Month: Growth Ahead?

Discover Financial (DFS) is well poised to capitalize on the resumption of loan growth as the economy keeps recovering from the pandemic. Discover Financial Services’ DFS shares have jumped 10.6% in the past month, outperforming the 5.9% increase of the industry, thanks to new account growth and consistently strong credit performance. The company has been gaining from the ongoing economic recovery, which is good for the payment services market and has positioned itself for better returns for the future.Image Source: Zacks Investment ResearchHeadquartered in Riverwoods, IL, Discover Financial is a digital banking and payment services company in the United States. The company offers credit cards, personal, student and home loans as well as multiple deposit products. DFS currently has a market cap of $37.7 billion.Can It Retain Momentum?The answer is yes and before we get into the details, let us show you how its estimates for full-year 2021 stand. The Zacks Consensus Estimate for Discover Financial’s 2021 earnings is pegged at $17.65 per share, indicating a 390.3% rise from $3.60 a year ago. The company beat earnings estimates in each of the last four quarters, with an average of 34.7%. The consensus estimate for 2021 revenuesstands at $12 billion, signaling an 8.4% year-over-year rise.Now let’s delve into what’s driving the Zacks Rank #3 (Hold) stock.Discover Financial is well poised to capitalize on the resumption of loan growth as the economy keeps recovering from the pandemic. Also, the expectation of Federal Reserve rate hikes this year to control inflation is beneficial for DFS. The continued digitization of payments, primarily led by the COVID-19 pandemic, is benefiting DFS’ business.The company’s revenues are expected to keep growing in the upcoming quarters on the back of its solid market position, expansion of the global payments business and attractive core business. In the first nine months of the year, card sales of the company increased 28% year over year.Discover Financial's balance sheet position remains impressive. Its net debt-to-capital ratio stands at 18.2X, lower than the industry's average of 34.1X. As of Sep 30, 2021, DFS had cash and investment securities worth $20.6 billion, much higher than its long-term borrowings of $18.5 billion. Thus, its solvency position looks strong.The company’s ability to generate cash from operations is impressive. In fact, in the trailing 12-month period, its free cash flow increased 2.9% to $6.1 billion. This reflects DFS’ operating strength.RisksDespite the upside potential, there are a few factors that are impeding the stock’s growth lately. Escalating costs and expenses are hurting its bottom line. Also, increasing provision for loan losses is one of the headwinds faced by the company. Nevertheless, we believe that a systematic and strategic plan of action will drive long-term growth.Stocks to ConsiderSome better-ranked players in the Finance sector include Ryan Specialty Group Holdings, Inc. RYAN, Houlihan Lokey, Inc. HLI, and Brown & Brown, Inc. BRO, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Based in Chicago, IL, Ryan Specialty provides numerous specialty products and solutions for insurance brokers, agents, and others. It acts as a wholesale broker and managing underwriter to provide risk management services. Ryan Specialty’s bottom line for the next year is expected to jump 13.6% year over year to $1.22 per share. RYAN has witnessed one upward estimate revision in the past 30 days and no movement in the opposite direction.Houlihan Lokey — headquartered in Los Angeles, CA — provides multiple financial services to clients all over the world. Its growing footprint in Europe and Asia’s investment banking services field will help HLI boost strategic and shareholder value in the coming days. Rising average transaction fees will help HLI increase corporate finance revenues. The bottom line of Houlihan Lokey for the current year is expected to rise 44.8% year over year to $6.69 per share.Headquartered in Daytona Beach, FL, Brown & Brown boasts an impressive growth potential driven by organic means and a prudent inorganic story. Its strategic efforts continue to drive commission and fees, and sturdy performance is boosting cash flows. Brown & Brown’s 2022 earnings per share are expected to rise 5.1% year over year to $2.27. It has witnessed one upward estimate revision in the past 30 days versus none in the opposite direction. Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Discover Financial Services (DFS): Free Stock Analysis Report Brown & Brown, Inc. (BRO): Free Stock Analysis Report Houlihan Lokey, Inc. (HLI): Free Stock Analysis Report Ryan Specialty Group Holdings, Inc. (RYAN): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 14th, 2022

Lindsay (LNN) Rides on Irrigation Demand Amid Cost Woes

Lindsay (LNN) is well-poised on improving agricultural commodity prices that will drive farm income and thereby demand for irrigation equipment. High costs are anticipated to dent near-term margins. Lindsay Corporation LNN is well-poised to gain on improving farm dynamics in the United States on the back of higher commodity prices. However, inflated costs and supply chain issues that are currently rampant in the industry are expected to hurt Lindsay’s near-term results. The company’s infrastructure business is positioned well for the long run, courtesy of strong demand for transportation safety products and higher infrastructure spending. A strong balance sheet, focus on introducing technologically advanced products, and investment in organic growth and acquisitions will drive growth for the company.Irrigation Demand to Remain StrongCorn and soybeans are the most important grains for cash crop farming in the United States. After a solid gain of 23% in 2021, corn price is currently at $6 a bushel amid solid demand and production concerns due to dry weather in South America, supply constraints and elevated global fertilizer prices. Soybean is at $13.8 per bushel and is being supported by supply worries stemming from drought conditions in Argentina and southern Brazil. In northern Brazil, rains have slowed down early harvest. Owing to high fertilizer prices, farmers are opting for soybean as it is a less fertilizer-intensive crop. High commodity prices will drive farm income and persuade farmers to continue spending on agricultural equipment. This, in turn, will drive Lindsay’s top line.Infrastructure Business Poised to GrowLower Road Zipper System sales have been weighing on the infrastructure segment revenues since last year as the timing of certain projects was impacted by coronavirus-related delays. With the emergence of different variants of coronavirus, the same might be repeated this year as well. However, the company anticipates an increase in project activity in the second half of fiscal 2022.Nevertheless, in the long run, Lindsay’s Road Zipper System is expected to be a key catalyst for the segment. It is a highly differentiated product that positively addresses key infrastructure needs such as reducing congestion, lowering carbon emission, and increasing driver safety, which has led to its global popularity.Demand for the company’s transportation safety products is highly dependent on government spending for road construction. The signing of the Infrastructure Investment and Jobs Act (IIJA) into law on Nov 15, 2021 will act as a tailwind for the infrastructure business. This legislation introduced $110 billion in incremental federal funding to repair roads, bridges and support other transformational projects, which will translate into higher demand for Lindsay’s transportation safety products. The IIJA includes a five-year $370 billion reauthorization of Fixing America’s Surface Transportation (Fast Act).Investment in Technology to Provide Competitive EdgeFocus on bringing technologically advanced products to the market will fuel Lindsay’s top line. In April 2020, the company completed the buyout of Net Irrigate, LLC, which will expand the number of irrigated acres managed under the company’s FieldNET platform. This acquisition strengthened Lindsay’s market position in remote monitoring capabilities. The company is witnessing strong growth in technology penetration, which will drive performance in the days ahead. The company anticipated new product revenues as a percentage of total revenues to go up from 2% in fiscal 2017 to 15% in 2023.A Solid Balance SheetBacked by a strong balance sheet, Lindsay continues to invest in organic growth, make synergistic acquisitions while enhancing returns to stockholders. As of Nov 30, 2021, the company had available liquidity of $164.9 million, with $114.9 million in cash, cash equivalents and marketable securities and $50 million available under the revolving credit facility. The company’s total debt to capital ratio was 0.25 as of Nov 30, 2021 — much lower than the industry’s total debt to capital ratio of 0.74. The company's times interest earned ratio is 12.2, much better than the industry's 7.8.Costs, Supply Chain Issues PrevailLindsay has been witnessing a rapid increase in input costs, particularly of steel and zinc used in the production of its products. Transportation costs have gone up. Constraints on the availability of raw materials, labor and trucking resources have led to higher lead times for deliveries. The company continues to introduce appropriate sales price adjustments to combat cost inflation. However, competitive market pressures may affect its ability to pass price adjustments to its customers. These factors will impact margins in the short term.Price PerformanceImage Source: Zacks Investment ResearchLindsay’s shares have declined 0.4% in the past year compared with the industry’s rally of 20.3%.Zacks Rank & Stocks to ConsiderAt present, Lindsay carries a Zacks Rank #3 (Hold).Some better-ranked stocks in the Industrial Products sector are Berry Global Group, Inc. BERY, Titan International TWI and Sealed Air Corporation SEE. While BERY and TWI flaunt a Zacks Rank #1 (Strong Buy), SEE carried a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Berry Global Group has an estimated earnings growth rate of around 2.8% for fiscal 2022. In the past 60 days, the Zacks Consensus Estimate for fiscal 2022 earnings has been revised upward by 18%.In a year, the company’s shares have increased 35.7%. Berry Global has a trailing four-quarter earnings surprise of 16.5%, on average.Titan Industrial has a projected earnings growth rate of 48% for fiscal 2022. The Zacks Consensus Estimate for fiscal 2022 earnings has been revised upward by 13% in the past 60 days.TWI’s shares have gained 55.7% in a year. Titan Industrial has a trailing four-quarter earnings surprise of 32%, on average.Sealed Air has an expected earnings growth rate of 16% for fiscal 2022. The Zacks Consensus Estimate for fiscal 2022 earnings has been revised upward by 1% in the past 60 days.Sealed Air’s shares have appreciated 50% in the past year. SEE has a trailing four-quarter earnings surprise of 6.54%, on average. Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Lindsay Corporation (LNN): Free Stock Analysis Report Sealed Air Corporation (SEE): Free Stock Analysis Report Titan International, Inc. (TWI): Free Stock Analysis Report Berry Global Group, Inc. (BERY): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksJan 14th, 2022

What Makes First Commonwealth Financial (FCF) a Strong Momentum Stock: Buy Now?

Does First Commonwealth Financial (FCF) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at First Commonwealth Financial (FCF), a company that currently holds a Momentum Style Score of A. We also talk about price change and earnings estimate revisions, two of the main aspects of the Momentum Style Score.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. First Commonwealth Financial currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?Let's discuss some of the components of the Momentum Style Score for FCF that show why this financial holding company shows promise as a solid momentum pick.Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area.For FCF, shares are up 7.15% over the past week while the Zacks Banks - Northeast industry is up 2.54% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 15.29% compares favorably with the industry's 3.86% performance as well.While any stock can see its price increase, it takes a real winner to consistently beat the market. That is why looking at longer term price metrics -- such as performance over the past three months or year -- can be useful as well. Over the past quarter, shares of First Commonwealth Financial have risen 19.38%, and are up 36.86% in the last year. In comparison, the S&P 500 has only moved 9.04% and 25.94%, respectively.Investors should also pay attention to FCF's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. FCF is currently averaging 597,400 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score also takes into account trends in estimate revisions, in addition to price changes. Please note that estimate revision trends remain at the core of Zacks Rank as well. A nice path here can help show promise, and we have recently been seeing that with FCF.Over the past two months, 1 earnings estimate moved higher compared to 1 lower for the full year. These revisions helped boost FCF's consensus estimate, increasing from $1.40 to $1.41 in the past 60 days. Looking at the next fiscal year, 3 estimates have moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that FCF is a #2 (Buy) stock and boasts a Momentum Score of A. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep First Commonwealth Financial on your short list. Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Commonwealth Financial Corporation (FCF): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 14th, 2022

Are You Looking for a Top Momentum Pick? Why Hess Midstream Partners LP (HESM) is a Great Choice

Does Hess Midstream Partners LP (HESM) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing is all about the idea of following a stock's recent trend, which can be in either direction. In the 'long' context, investors will essentially be "buying high, but hoping to sell even higher." And for investors following this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving in that direction. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Hess Midstream Partners LP (HESM), which currently has a Momentum Style Score of B. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Hess Midstream Partners LP currently has a Zacks Rank of #2 (Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if HESM is a promising momentum pick, let's examine some Momentum Style elements to see if this company holds up.A good momentum benchmark for a stock is to look at its short-term price activity, as this can reflect both current interest and if buyers or sellers currently have the upper hand. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area.For HESM, shares are up 3.62% over the past week while the Zacks Energy and Pipeline - Master Limited Partnerships industry is up 5.88% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 15.38% compares favorably with the industry's 15.16% performance as well.While any stock can see a spike in price, it takes a real winner to consistently outperform the market. Over the past quarter, shares of Hess Midstream Partners LP have risen 10.78%, and are up 35.72% in the last year. On the other hand, the S&P 500 has only moved 9.04% and 25.94%, respectively.Investors should also take note of HESM's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, HESM is averaging 398,005 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with HESM.Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost HESM's consensus estimate, increasing from $1.84 to $1.96 in the past 60 days. Looking at the next fiscal year, 2 estimates have moved upwards while there have been no downward revisions in the same time period.Bottom LineGiven these factors, it shouldn't be surprising that HESM is a #2 (Buy) stock and boasts a Momentum Score of B. If you're looking for a fresh pick that's set to soar in the near-term, make sure to keep Hess Midstream Partners LP on your short list. Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Hess Midstream Partners LP (HESM): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksJan 14th, 2022

Here"s Why Momentum Investors Will Love Nucor (NUE)

Does Nucor (NUE) have what it takes to be a top stock pick for momentum investors? Let's find out. Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock characteristic, it can be tough to define. Debate surrounding which are the best and worst metrics to focus on is lengthy, but the Zacks Momentum Style Score, part of the Zacks Style Scores, helps address this issue for us.Below, we take a look at Nucor (NUE), which currently has a Momentum Style Score of B. We also discuss some of the main drivers of the Momentum Style Score, like price change and earnings estimate revisions.It's also important to note that Style Scores work as a complement to the Zacks Rank, our stock rating system that has an impressive track record of outperformance. Nucor currently has a Zacks Rank of #1 (Strong Buy). Our research shows that stocks rated Zacks Rank #1 (Strong Buy) and #2 (Buy) and Style Scores of A or B outperform the market over the following one-month period.You can see the current list of Zacks #1 Rank Stocks here >>>Set to Beat the Market?In order to see if NUE is a promising momentum pick, let's examine some Momentum Style elements to see if this steel company holds up.Looking at a stock's short-term price activity is a great way to gauge if it has momentum, since this can reflect both the current interest in a stock and if buyers or sellers have the upper hand at the moment. It is also useful to compare a security to its industry, as this can help investors pinpoint the top companies in a particular area.For NUE, shares are up 0.25% over the past week while the Zacks Steel - Producers industry is up 0.91% over the same time period. Shares are looking quite well from a longer time frame too, as the monthly price change of 6.01% compares favorably with the industry's 11.89% performance as well.Considering longer term price metrics, like performance over the last three months or year, can be advantageous as well. Over the past quarter, shares of Nucor have risen 9.09%, and are up 102.29% in the last year. On the other hand, the S&P 500 has only moved 9.04% and 25.94%, respectively.Investors should also take note of NUE's average 20-day trading volume. Volume is a useful item in many ways, and the 20-day average establishes a good price-to-volume baseline; a rising stock with above average volume is generally a bullish sign, whereas a declining stock on above average volume is typically bearish. Right now, NUE is averaging 2,907,229 shares for the last 20 days.Earnings OutlookThe Zacks Momentum Style Score encompasses many things, including estimate revisions and a stock's price movement. Investors should note that earnings estimates are also significant to the Zacks Rank, and a nice path here can be promising. We have recently been noticing this with NUE.Over the past two months, 1 earnings estimate moved higher compared to none lower for the full year. These revisions helped boost NUE's consensus estimate, increasing from $23.16 to $23.30 in the past 60 days. Looking at the next fiscal year, 4 estimates have moved upwards while there have been no downward revisions in the same time period.Bottom LineTaking into account all of these elements, it should come as no surprise that NUE is a #1 (Strong Buy) stock with a Momentum Score of B. If you've been searching for a fresh pick that's set to rise in the near-term, make sure to keep Nucor on your short list. Bitcoin, Like the Internet Itself, Could Change Everything Blockchain and cryptocurrency has sparked one of the most exciting discussion topics of a generation. Some call it the “Internet of Money” and predict it could change the way money works forever. If true, it could do to banks what Netflix did to Blockbuster and Amazon did to Sears. Experts agree we’re still in the early stages of this technology, and as it grows, it will create several investing opportunities. Zacks’ has just revealed 3 companies that can help investors capitalize on the explosive profit potential of Bitcoin and the other cryptocurrencies with significantly less volatility than buying them directly. See 3 crypto-related stocks now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nucor Corporation (NUE): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksJan 14th, 2022

JPMorgan (JPM) Q4 Earnings Beat on M&A Boom, Reserve Release

Solid advisory business performance, a decent rise in loans and credit release support JPMorgan's (JPM) Q4 earnings amid lower rates, and weak trading and mortgage banking performance. Robust advisory business, reserve release and a rise in loan demand drove JPMorgan’s JPM fourth-quarter 2021 earnings of $3.33 per share. The bottom line handily outpaced the Zacks Consensus Estimate of $3.01.Results included net credit reserve releases. Excluding this, earnings came in at $2.86 per share.Despite reporting better-than-expected earnings, shares of the company have lost almost 3.8% in pre-market trading. Investors seem to be disappointed with JPMorgan’s trading business performance and 2022 expense outlook. Equity markets revenues and fixed income markets revenues fell 2% and 16%, respectively, on a year-over-year basis. So, total markets revenues of $5.3 billion declined 11%.During the quarter, operating expenses recorded an increase. Management expects adjusted non-interest expenses to be $77 billion this year.Also, mortgage fees and related income plunged 59% to $315 million. Further, Commercial Banking average loan balances were down 2% year over year.During the fourth quarter, the company reported net reserve releases of $1.8 billion on the back of “continued resilience in the macroeconomic environment.”Regarding investment banking (“IB”) performance, equity and debt underwriting fees rose 12% and 14%, respectively. Continued stellar deal-making activities across the globe during the quarter led JPMorgan to record an 86% surge in advisory fees. Hence, IB fees jumped 37% from the prior-year quarter. Also, the company ranked #1 for global investment banking fees with a 9.5% wallet share for 2021.While lower rates continued to hurt the bank’s interest income, it was more than offset by a rise in loan balance (up 6% year over year and 3% from the prior quarter).Among other positives, Asset & Wealth Management average loan balances grew 18% from the year-ago quarter. Debit and credit card sales volume increased 26%, reflecting a steadily improving consumer confidence and economic outlook.The overall performance of JPMorgan’s business segments, in terms of net income generation, was dismal. All segments, except Asset & Wealth Management, reported a decrease in net income on a year-over-year basis.Thus, net income decreased 14% from the prior-year quarter to $10.4 billion. Excluding the above-mentioned reserve releases, net income was $9 billion.Revenues Stable, Costs RiseNet revenues as reported were $29.26 billion, relatively stable year over year. The top line lagged the Zacks Consensus Estimate of $29.95 billion.Net interest income grew 3% year over year to $13.6 billion.Non-interest income declined 3% to $15.6 billion, primarily due to a fall in mortgage banking and related fees, card income and principal transactions. These were partially offset by solid IB performance.Non-interest expenses (on managed basis) were $17.9 billion, up 11%. This upswing was mainly due to a rise in compensation expenses.Credit Quality ImprovesProvision for credit losses was a net benefit of $1.3 billion compared with a benefit of $1.9 million in the prior-year quarter. Further, net charge-offs plunged 48% to $550 million.As of Dec 31, 2021, non-performing assets were $8.3 billion, down 23% from Dec 31, 2020 level.Solid Capital PositionTier 1 capital ratio (estimated) was 15% at the fourth quarter-end, on par with the prior-year quarter level. Tier 1 common equity capital ratio (estimated) was 13%, down from 13.1%. Total capital ratio was 16.8% (estimated) compared with 17.3% as of Dec 31, 2020.Book value per share was $88.07 as of Dec 31, 2021, compared with $81.75 in the corresponding period of 2020. Tangible book value per common share was $71.53 at the end of December, up from $66.11.Share Repurchase UpdateDuring the quarter, JPMorgan repurchased shares worth $1.9 billion.Our ViewNew branch openings, strategic acquisitions, global expansion plan and robust IB performance are likely to continue supporting JPMorgan’s revenues. A rise in loan balance is a major tailwind as the economy re-opens. However, lower rates and disappointing trading and mortgage banking performance are near-term concerns. JPMorgan Chase & Co. Price, Consensus and EPS Surprise JPMorgan Chase & Co. price-consensus-eps-surprise-chart | JPMorgan Chase & Co. QuoteJPMorgan currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Earnings Dates & Expectations of Other Major BanksThe PNC Financial Services Group PNC is slated to report fourth-quarter and full-year 2021 results on Jan 18.Over the past 30 days, the Zacks Consensus Estimate for PNC Financial’s quarterly earnings has moved marginally lower to $3.61. This indicates a 10.7% rise from the prior-year quarter.Truist Financial TFC is scheduled to announce fourth-quarter and 2021 numbers on Jan 18.Over the past 30 days, the Zacks Consensus Estimate for Truist’s quarterly earnings has moved almost 1% lower to $1.26, suggesting a 6.8% increase from the prior-year reported number.Bank of America BAC is scheduled to announce fourth-quarter and full-year 2021 numbers on Jan 19.Over the past 30 days, the Zacks Consensus Estimate for Bank of America’s quarterly earnings has moved 2.6% south to 96 cents, implying a 28.8% jump from the prior-year reported number. 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 5 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 The PNC Financial Services Group, Inc (PNC): 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: zacksJan 14th, 2022