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Category: topSource: marketwatchMay 26th, 2021

The "Great Game" Moves On

The 'Great Game' Moves On Authored by Alasdair Macleod via GoldMoney.com, Following America’s withdrawal from Afghanistan, her focus has switched to the Pacific with the establishment of a joint Australian and UK naval partnership. The founder of modern geopolitical theory, Halford Mackinder, had something to say about this in his last paper, written for the Council on Foreign Relations in 1943. Mackinder anticipated this development, though the actors and their roles at that time were different. In particular, he foresaw the economic emergence of China and India and the importance of the Pacific region. This article discusses the current situation in Mackinder’s context, taking in the consequences of green energy, the importance of trade in the Pacific region, and China’s current deflationary strategy relative to that of declining western powers aggressively pursuing asset inflation. There is little doubt that the world is rebalancing as Mackinder described nearly eighty years ago. To appreciate it we must look beyond the West’s current economic and monetary difficulties and the loss of its hegemony over Asia, and particularly note the improving conditions of the Asia’s most populous nations. Introduction Following NATO’s defeat in the heart of Asia, and with Afghanistan now under the Taliban’s rule, the Chinese/Russian axis now controls the Asian continental mass. Asian nations not directly related to its joint hegemony (not being members, associates, or dialog partners of the Shanghai Cooperation Organisation) are increasingly dependent upon it for trade and technology. Sub-Saharan Africa is in its sphere of influence. The reality for America is that the total population in or associated with the SCO is 57% of the world population. And America’s grip on its European allies is slipping. NATO itself has become less relevant, with Turkey drawn towards the rival Asian axis, and its EU members are compromised through trading and energy links with Russia and China. Furthermore, France is pushing the EU towards establishing its own army independent of US-led NATO — quite what its role will be, other than political puffery for France is a mystery. It is against this background that three of the Five Eyes intelligence partnership have formed AUKUS – standing for Australia, UK, and US — and its first agreement is to give Australia a nuclear submarine capability to strengthen the partnership’s naval power in the Pacific. Other capabilities, chiefly aimed at containing the Chinese threat to Taiwan and other allies in the Pacific Ocean, will surely emerge in due course. The other two Five Eyes, Canada and New Zealand, appear to be less keen to confront China. But perhaps they will also have less obvious roles in due course beyond pure intelligence gathering. The US, under President Trump, had failed to contain China’s increasing economic dominance and its rapidly developing technological challenge to American supremacy. Trump’s one success was to peel off the UK from its Cameron/Osbourne policy of strengthening trade and financial ties with China by threatening the UK’s important role in its intelligence partnership with the US. For the UK, the challenge came at a critical time. Brexit had happened, and the UK needed global partners for its future trade and geopolitical strategies, the latter needed to cement its re-emergence onto the world stage following Brexit. Trump held out the carrot of a fast-tracked US/UK trade deal. The Swiss alternative of neutrality in international affairs is not in the UK’s DNA, so realistically the decision was a no-brainer: the UK had to recommit itself entirely to the Anglo-Saxon Five-Eyes partnership with the US, Canada, Australia, and New Zealand and turn its back on China. But gathering intelligence and building naval power in the Pacific won’t defeat the Chinese. All simulations show that the US, with or without AUKUS, cannot win a military conflict against China. But AUKUS is not a formal model on NATO lines which commits its members by treaty to aggression against a common enemy. While Taiwan remains a specific problem, the objective is almost certainly to discourage China from territorial expansion and protect and give other Pacific nations on the Asian periphery the security to be independent from the SCO behemoth. The trade benefits of closer relationships with these independent nations are also an additional reason for the UK to join the CPTPP — the Comprehensive and Progressive Agreement for Trans-Pacific Partnership. It qualifies for membership through its sovereignty over the Pitcairn Islands. And that is why China has also applied to join. Therefore, AUKUS’s importance is in the signal sent to China and the whole Pacific region, following the abandonment of land-based operations in the Middle East and Afghanistan. The maritime threat to China is a line which must not be crossed. We are entering a new era in the Great Game, where the objective has changed from dominance to containment. Having lost its position of ultimate control in the Eurasian land mass America has selected its partners to retain control over the high seas. And the UK has found a new geopolitical purpose, re-establishing a global role now that it is independent from the EU. The French cannot join the CPTPP being bound into the common trade policies of the EU. Seeing the British escape the strictures of the EU and rapidly obtain more global influence than France could dream of has touched a raw nerve. Mackinder vindicated The father of geopolitics, Halford Mackinder, is frequently quoted and his theories are still relevant to the current situation. Much has been written about Mackinder’s prophecies. His concept of the World Island was first mentioned in his 1904 presentation to the Royal Geographic Society in London: “a pivot state, resulting in its expansion over the marginal lands of Euro-Asia”. In 1943 he updated his views in an article for the Council on Foreign Relations, adding to his heartland theory. Written during the Second World War, his commentary reflected the combatants and their positions at that time. But despite this, he made a perceptive comment relative to the situation today and AUKUS: “Were the Chinese for instance organised by the Japanese to overthrow the Russian Empire and conquer its territory they might constitute the yellow peril to the world’s freedom just because they would add an oceanic frontage to the resources of the great continent.” When Mackinder wrote his article the Japanese had already invaded Manchuria, but their subsequent defeat removed them from an active geopolitical role, and in place of a Soviet defeat China has entered a peaceful partnership with Russia that extends to all its old Central Asian soviet satellites. It is the focus on the ocean frontage that matters, upon which the maritime silk road depends. The article brings into play another aspect mentioned by Mackinder, and that is the Heartland’s tremendous natural resources, “…including enough coal in the Kuznetsk and Krasnoyarsk basins capable of supplying the requirements of the whole world for 300 years”. And: “In 1938 Russia produced more of the following food stuffs than any other country in the world: wheat, barley, oats, rye, and sugar beets. More manganese was produced in Russia than in any other country. It was bracketed with United States in the first place as regards iron and it stood second place in production of petroleum”. Through its partnership with Russia all these latent resources are available to the Chinese and Russian partnership. And the real potential for industrialisation, held back by communism and now by Russian corruption, has barely commenced. After presciently noting that one day the Sahara may become the trap for capturing direct power from the sun (foreseeing solar panels), Mackinder’s article ended on an optimistic note: “A thousand million people of ancient oriental civilisation inhabit the monsoon lands of India and China [today 3 billion, including Pakistan]. They must grow to prosperity in the same years in which Germany and Japan are being tamed to civilisation. They will then balance that other thousand million who live between the Missouri and the Yenisei [i.e., Central and Eastern America, Britain, Europe and Russia beyond the Urals]. A balanced globe of human beings and happy because balanced and thus free.” Both China and now India are rapidly industrialising, becoming part of a balanced globe of humanity. While the West tries to hang on to what it has got rather than progressing, China and India along with all of under-developed Asia are moving rapidly in the direction of individual freedom of economic choice and improvements in living conditions, to which Mackinder was referring. Obviously, there is some way for this process yet to go, displacing western hegemony in the process. America particularly has found the political challenges of change difficult, with its deep state unable to come to terms easily with the implications for its military and economic power. We must hope that Mackinder was right, and the shift of economic power is best to be regarded as the pains of geopolitical evolution rather than conditions for escalating conflict. But in pursuing its green agenda and eschewing carbon fuels, the West is unwittingly handing a gift to Mackinder’s Heartland, because despite diplomatic noises to the contrary China, India and all the SCO membership will continue to use cheap coal, gas, and oil which Asia has in abundance while Western manufacturers are forced by their governments to use expensive and less reliable green energy. Green obsessions and global trade Meanwhile, the West has gone green-crazy. Banning fossil fuels without there being adequate replacements must be a new definition of insanity, for which the current fuel crises in Europe attest. With over 95% of European logistics currently being shifted by diesel power, switching to battery power or hydrogen by 2030 by banning sales of new internal combustion engine vehicles is a hostage to fortune. While it is hardly mentioned, presumably the Western powers think that by banning carbon fuels they will take the wind out of Russia’s energy quasi-monopoly, because including gas Russia is the largest exporter of fossil fuels in the world. Instead, the West is creating an energy shortage for itself, a point driven home by Gazprom withholding gas flows through its pipelines to Europe, thereby driving up Europe’s energy costs sharply and ensuring a far more severe energy crisis this winter. Even if Russia turns on the taps tomorrow, there is insufficient gas storage in reserve for the winter months. And Europe and the UK have got ahead of themselves by decommissioning coal and gas-fired electricity. In the UK, a massive undersea gas storage facility off the Yorkshire coast has been closed, leaving precious little national storage capacity. As we have seen with the post-covid supply chain chaos, energy problems will not only become acute this winter, but are likely to persist through much of next year. And even that assumes Russia relents and moderates its energy stance to European customers. By way of contrast, though its partnership with Russia China is gifted unlimited access to all carbon fuels. She is still building coal-fired electricity power stations at an extraordinary rate — according to a BBC report there are 61 new ones being commissioned. A further 51 outside China are planned. As a sop to the West China has only said she won’t finance any more outside her territory. And India relies on coal for over two-thirds of its electrical energy. While Europe and America through their green obsessions are denying themselves the availability and technologies that go with carbon fuels, the Russian/Chinese axis will continue to reap the full benefits. The West’s response is likely to be to decry Chinese pollution and its contribution to global warming, but realistically there is little it can do. Demand for Chinese-manufactured goods will continue because China now has a quasi-monopoly on global manufacturing for export. In the unlikely event western consumers become avid savers while their governments continue to run massive budget deficits, their trade deficits will rise even more, allowing Chinese exporters to increase prices for consumers and intermediate goods without losing export sales. While there is nothing it can do about China’s production methods, AUKUS members will undoubtedly lean on other exporting CPTPP members to comply with global green policies. But they will be competing with China, and while they may pay lip service to the climate change agenda, in practice they are unlikely to implement it without holding out for unrealistic subsidies from the western nations driving the climate change agenda. Under current circumstances, it seems unlikely that China’s CPTPP application will lead to membership, given the CPTPP requirement for China’s central government to relinquish ownership of its SOEs and to permit the free flow of data across its borders. In any event, China is focused on developing its Regional Comprehensive Economic Partnership (RCEP), a free trade agreement with ratification signed so far by China, Japan, South Korea, Australia, and New Zealand. It will come into effect when ratified by ten out of the fifteen signatories, likely to be in the first half of 2022, and in terms of population will be two and a half times the size of the EU and the US/Mexico/Canada (USMCA) trade agreements combined. With four out of five of the signatories being American allies, RCEP demonstrates that the AUKUS defence partnership is an entirely separate issue from trade. While the US may not like it, if RCEP goes ahead freer trade will almost certainly undermine a belligerent stance in due course. Despite hiccups, the progression of trade dealing in the Pacific region promises to prove Mackinder right about the prospect of a more balanced world. All being well and guaranteed by a balance of naval capabilities between AUKUS and China, a free-trading Pacific region will render the European and American trade protectionist policies an anachronism. But the threat is now from another direction: financial instability, with western nations pulling in one direction and China in another. Since the Lehman collapse and the ensuing financial crisis, China has been careful to prevent financial bubbles. Figure 1 shows that the Shanghai Composite Index has risen 82% since 2008, while the S&P500 rose 430%. While the US has seen financial asset values driven by a combination of QE and investor speculation, these factors are absent and discouraged in China. Government debt to GDP is about half that of the US. It is true that industrial debt is high, like that of the US. But the difference is that in China debt is more productive while in America there has been a growing preponderance of debt zombies, only kept solvent by zero interest rate policies. China’s policy of ensuring that the expansion of bank credit is invested in production and not speculation differs fundamentally from the US approach, which is to deliberately inflate financial assets to perpetuate a wealth effect. China avoids the destabilising potential of speculative flows unwinding because it lays the economy open to the possibility that America will use financial instability to undermine China’s economy. In a speech to the Chinese Communist Party’s Central Committee in April 2015, Major-General Qiao Liang, the People’s Liberation Army strategist, identified a cycle of dollar weakness against other currencies followed by strength, which first inflated debt in foreign countries and then bankrupted them. Qiao argued it was a deliberate American policy and would be used against China. In his words, it was time for America to “harvest” China. Drawing on Chinese intelligence reports, in early 2014 he was made aware of American involvement in the “Occupy Central” movement in Hong Kong. After several delays, the Fed announced the end of QE the following September which drove the dollar higher, and “Occupy Central” protests broke out the following month. To Qiao the two events were connected. By undermining the dollar/yuan rate and provoking riots, the Americans had tried to crash China’s economy. Within six months the Shanghai stock market began to collapse with the SSE Composite Index falling from 5,160 to 3,050 between June and September 2015. One cannot know for certain if Qiao’s analysis was correct, but one can understand the Chinese leadership’s continued caution based upon it. For this and other reasons, the Chinese leadership is extremely wary of having dollar liabilities and the accumulation of unproductive, speculative money in the economy. It justifies their strict exchange control regime, whereby dollars are not permitted to circulate in China, and all inward capital flows are turned into yuan by the PBOC. Furthermore, domestic monetary policy appears deliberately different from that of America and other western nations. While everyone else has been inflating their way through covid, China has been restricting domestic credit expansion and curtailing shadow banking. The discount rate is held up at 2.9% with market rates slightly lower at 2.2%, and the only reason it is that low is because alternative dollar rates are at zero and EU and Japanese rates are negative. It is this restrictive monetary policy that has led to the current crisis in property developers, with the very public difficulties of Evergrande. Far from being a surprise event, with cautious monetary policies it could have been easily foreseen. Moreover, the government has a sensible policy of not rescuing private sector businesses in trouble, though it is likely to take steps to limit financial contagion. In their glass houses, Western critics continually throw stones at China. But at least her policy makers have attempted to avoid contributing to the global inflation cycle. With prices beginning to rise at an accelerating pace in western currencies, a new global financial crash is in the making. China and her SCO cohort would be adversely affected, but not to the same extent. The fruits of China’s policies of restricting credit expansion are showing in the commodity prices she pays, which in her own currency have increased by ten per cent less than for dollar-based competition, judging by the exchange rate movements since the Fed reduced its funds rate to the zero bound and instigated monthly QE of $120bn on 19-23 March 2020 (see Figure 2). And while both currencies have moved broadly sideways since January, there is little doubt that the fundamentals point to an even stronger yuan and weaker dollar. The domestic benefits of a relatively stronger yuan outweigh the margin compression suffered by China’s exporters. It is worth noting that as well as moderating credit demand, China is attempting to increase domestic consumer spending at the expense of the savings rate, so consumer demand will begin to matter more than exports to producers. It is in line with a long-term objective of China becoming less dependent on exports, and exporters will benefit from domestic sales growth instead. Furthermore, with China dominating global exports of intermediate and consumer goods and while western budget deficits are increasing and leading to yet greater trade deficits, Chinese exporters should be able to secure higher prices anyway. There can be little doubt that the budget deficits financed by monetary inflation in America, the EU, Japan and the UK, plus central bank stimulus packages are now undermining the purchasing power of all the major currencies. The consequences for their purchasing powers are now becoming apparent and attempts to calm markets and consumers by describing them as transient cuts little ice. In terms of their purchasing powers, these currencies are now in a race to the bottom. Not only are the costs of production rising sharply, but following a brief pause of three months, commodity and energy prices look set to rise sharply. Figure 3 shows the Invesco commodity tracker, which having almost doubled since March 2020 now appears to be attempting a break out on the upside. Since global competitiveness is no longer a priority, China would be sensible to let its yuan exchange rate rise against western currencies to help keep a lid on domestic prices and costs. It is, after all, a savings driven economy, with the sustainable characteristics of a strong currency relative to the dollar. Conclusions Having failed in their land-based military objectives, America’s undeclared tariff and financial wars against China are also coming to an end, to be replaced by a policy of maritime containment through the AUKUS partnership. Attempts to stem strategic losses in Asia have now ended with the withdrawal from Afghanistan and from other interventions.The change in geopolitical policy is not yet widely appreciated. But the parlous state of US finances, dollar market bubbles, persistent and increasing price inflation and the inevitability of interest rate increases will make a policy backstop of maritime containment the only geostrategic option left to America. By pursuing more cautious monetary policies, China is less exposed to the inevitable consequences of global monetary inflation. While yuan currency rates are managed instead of set by markets, it is now in China’s interest to see a stronger yuan to contain domestic price and cost inflation. Even though fiat currencies could be destroyed by imploding asset bubbles, these factors contribute to a set of circumstances that appear to lead to a more peaceable outcome for the world than appeared likely before America and NATO withdrew from Afghanistan. There’s many a slip between cup and lip; but it was an outcome forecast by Halford Mackinder nearly eighty years ago. Let us hope he was right. Tyler Durden Sun, 09/26/2021 - 08:10.....»»

Category: personnelSource: nyt19 hr. 5 min. ago

Methanex (MEOH) Announces a New 5% Share Buyback Program

Methanex's (MEOH) purchases pursuant to the NCIB will be made on the open market through the facilities of the NASDAQ Global Select Market and alternative trading systems in the United States. Methanex Corporation’s MEOH board recently approved a Normal Course Issuer Bid (“NCIB”), wherein the company will purchase for cancellation up to 3,810,464 common shares. This represents 5% of the 76,209,280 shares issued and outstanding as of Sep 16, 2021.Purchases under the NCIB will begin on Sep 24, 2021 and get completed by Sep 23, 2022. Purchases will be made from time to time at the then current market price of the shares and all shares purchased under the NCIB will be cancelled.Purchases pursuant to the NCIB will be made on the open market through the facilities of the NASDAQ Global Select Market and alternative trading systems in the United States, per Rule 10b-18 under the U.S. Securities Exchange Act of 1934.The daily repurchases under the plan through the NASDAQ and alternative trading systems in the United States, subject to certain exceptions for block purchases, will not exceed 25% of the company’s average daily trading volume for the four week period before the date of purchase. Methanex entered into an automatic securities purchase plan with its broker related to purchases to be made under the program.Methanex’s strong financial position and a strong methanol price environment enables it to generate significant cash flow to maintain its business, fund the remaining capital costs for the Geismar 3 project as well as return excess cash to shareholders.Shares of Methanex have surged 101.3% in the past year compared with a 21.7% rise of the industry.Image Source: Zacks Investment ResearchMethanex, in its last earnings call, stated that its outlook for the methanol industry is positive, owing to the ongoing favorable industry conditions. Strong methanol demand along with the industry supply challenges continues to drive tight market conditions into the third quarter. New industry supply and the Geismar 3 project are requisites for catering to the methanol demand growth.The company is optimistic about its Geismar 3 project to strengthen its portfolio and support its future cash generation as well as future shareholder distribution increases. It also anticipates the recent shipping partnership between its subsidiary, Waterfront Shipping, and Mitsui O.S.K. Lines, Ltd. to strengthen financial position.Methanex Corporation Price and Consensus  Methanex Corporation price-consensus-chart | Methanex Corporation Quote Zacks Rank & Other Key PicksMethanex currently sports a Zacks Rank #1 (Strong Buy).Some other top-ranked stocks in the basic materials space are Nucor Corporation NUE, The Chemours Company CC and Olin Corporation OLN.Nucor has a projected earnings growth rate of around 534.4% for the current year. The company’s shares have surged 119.7% in a year. It currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.Chemours has an expected earnings growth rate of around 86.4% for the current year. The company’s shares have gained 39.5% in the past year. It currently flaunts a Zacks Rank #1.Olin has an expected earnings growth rate of around 639.3% for the current fiscal. The company’s shares have surged 309.8% in the past year. It currently carries a Zacks Rank #2 (Buy). Time to Invest in Legal Marijuana If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027. After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%. You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.Today, Download Marijuana Moneymakers FREE >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nucor Corporation (NUE): Free Stock Analysis Report Methanex Corporation (MEOH): Free Stock Analysis Report Olin Corporation (OLN): Free Stock Analysis Report The Chemours Company (CC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 24th, 2021

This Top Computer and Technology Stock is a #1 (Strong Buy): Why It Should Be on Your Radar

Wondering how to pick strong, market-beating stocks for your investment portfolio? Look no further than the Zacks Rank. It doesn't matter if you're a growth, value, income, or momentum-focused investor -- building a successful investment portfolio takes skill, research, and a little bit of luck.But how do you find the right combination of stocks? Funding your retirement, your kids' college tuition, or your short- and long-term savings goals certainly requires significant returns.Enter the Zacks Rank.What is the Zacks Rank?A unique, proprietary stock-rating model, the Zacks Rank uses earnings estimate revisions, or changes to a company's earnings expectations, to help investors create a winning portfolio.There are four main factors behind the Zacks Rank: Agreement, Magnitude, Upside, and Surprise.Agreement is the extent to which all brokerage analysts are revising their earnings estimates in the same direction. The greater the percentage of analysts revising their estimates higher, the better chance the stock will outperform.Magnitude is the size of the recent change in the consensus estimate for the current and next fiscal years.Upside is the difference between the most accurate estimate, which is calculated by Zacks, and the consensus estimate.Surprise is made up of a company's last few quarters' earnings per share surprises; companies with a positive earnings surprise are more likely to beat expectations in the future.Each one of these factors is given a raw score that's recalculated every night, and then compiled into the Zacks Rank. Using this data, stocks are classified into five groups, ranging from "Strong Buy" to "Strong Sell."The Power of Institutional InvestorsThe Zacks Rank also allows individual investors, or retail investors, to benefit from the power of institutional investors.Institutional investors are responsible for managing the trillions of dollars invested in mutual funds, hedge funds, and investment banks. Research has shown that these investors can and do move the market due to the large amount of money they deal with, and thus, the market tends to move in the same direction as them.These investors are known for designing valuation models that focus on earnings and earnings expectations in order to figure out the fair value of a company and its shares. If earnings estimates are raised, it puts a higher value on a company.With these changes, institutional investors will act, usually buying stocks with rising estimates and selling those with falling estimates. An increase in earnings expectations can potentially lead to higher stock prices and bigger gains for the investor.Because it can take a long time for an institutional investor to build a position -- sometimes weeks, if not months -- retail investors who get in at the first sign of upward revisions have a distinct advantage over these larger investors, and can benefit from the expected institutional buying that will follow.Not only can the Zacks Rank help you take advantage of trends in earnings estimate revisions, but it can also provide a way to get into stocks that are highly sought after by professionals.How to Invest with the Zacks RankThe Zacks Rank is known for transforming investment portfolios. In fact, a portfolio of Zacks Rank #1 (Strong Buy) stocks has beaten the market in 26 of the last 32 years, with an average annual return of +25.41%.Moreover, stocks with a new #1 (Strong Buy) ranking have some of the biggest profit potential, while those that fell to a #4 (Sell) or #5 (Strong Sell) have some of the worst.Let's take a look at Apple (AAPL), which was added to the Zacks Rank #1 list on September 9, 2021.Apple’s business primarily runs around its flagship iPhone. However, the Services portfolio that includes revenues from cloud services, App store, Apple Music, AppleCare, Apple Pay, and licensing and other services now became the cash cow.For fiscal 2021, 11 analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.40 to $5.59 per share. AAPL boasts an average earnings surprise of 23.7%.Analysts are expecting earnings to grow 70.4% for the current fiscal year, with revenue forecasted to rise 33.8%.Additionally, AAPL has climbed higher over the past four weeks, gaining 0.5%. The S&P 500 is down 0.6% in comparison.Bottom LineWith a #1 (Strong Buy) ranking, positive trend in earnings estimate revisions, and strong market momentum, Apple should be on investors' shortlist.If you want even more information on the Zacks Ranks, or one of our many other investing strategies, check out the Zacks Education home page.Discover Today's Top StocksOur private Zacks #1 Rank List, based on our quantitative Zacks Rank stock-rating system, has more than doubled the S&P 500 since 1988. Applying the Zacks Rank in your own trading can boost your investing returns on your very next trade. See Today's Zacks #1 Rank List >> Time to Invest in Legal Marijuana If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027. After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%. You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.Today, Download Marijuana Moneymakers FREE >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Apple Inc. (AAPL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 24th, 2021

How to Find Strong Buy Retail and Wholesale Stocks Using the Zacks Rank

Finding strong, market-beating stocks with a positive earnings outlook becomes easier with the Zacks Rank. Whether you're a growth, value, income, or momentum-focused investor, building a successful investment portfolio takes skill, research, and a little bit of luck.How do you find the right combination of stocks that will generate returns that could fund your retirement, or your kids' college tuition, or your short- and long-term savings goals?Enter the Zacks Rank.What is the Zacks Rank?A unique, proprietary stock-rating model, the Zacks Rank uses earnings estimate revisions, or changes to a company's earnings expectations, to help investors create a winning portfolio.There are four main factors behind the Zacks Rank: Agreement, Magnitude, Upside, and Surprise.Agreement is the extent to which all brokerage analysts are revising their earnings estimates in the same direction. The greater the percentage of analysts revising their estimates higher, the better chance the stock will outperform.Magnitude is the size of the recent change in the consensus estimate for the current and next fiscal years.Upside is the difference between the most accurate estimate, which is calculated by Zacks, and the consensus estimate.Surprise is made up of a company's last few quarters' earnings per share surprises; companies with a positive earnings surprise are more likely to beat expectations in the future.Each one of these factors is given a raw score that's recalculated every night, and then compiled into the Zacks Rank. Using this data, stocks are classified into five groups, ranging from "Strong Buy" to "Strong Sell."The Power of Institutional InvestorsThe Zacks Rank also allows individual investors, or retail investors, to benefit from the power of institutional investors.Institutional investors are responsible for managing the trillions of dollars invested in mutual funds, hedge funds, and investment banks. Research has shown that these investors can and do move the market due to the large amount of money they deal with, and thus, the market tends to move in the same direction as them.In order to determine the fair value of a company and its shares, institutional investors design valuation models that focus on earnings and earnings estimates. Because if you raise earnings estimates, it then creates a higher fair value for a company and its stock price.With these changes, institutional investors will act, usually buying stocks with rising estimates and selling those with falling estimates. An increase in earnings expectations can potentially lead to higher stock prices and bigger gains for the investor.Retail investors who get in at the first sign of upward revisions have a distinct advantage over larger investors since it can often take weeks, if not months, for an institutional investor to build a position. They'll also benefit from the expected institutional buying that could follow.Not only can the Zacks Rank help you take advantage of trends in earnings estimate revisions, but it can also provide a way to get into stocks that are highly sought after by professionals.How to Invest with the Zacks RankThe Zacks Rank is known for transforming investment portfolios. In fact, a portfolio of Zacks Rank #1 (Strong Buy) stocks has beaten the market in 26 of the last 32 years, with an average annual return of +25.41%.Moreover, stocks with a new #1 (Strong Buy) ranking have some of the biggest profit potential, while those that fell to a #4 (Sell) or #5 (Strong Sell) have some of the worst.Let's take a look at Lithia Motors (LAD), which was added to the Zacks Rank #1 list on July 24, 2021.Lithia Motors, Inc. is one of the leading automotive retailers of new and used vehicles, and related services in the United States. As of Dec 31, 2020, the company offered 33 vehicle brands across 209 stores in 22 states within the United States. The core brands offered by Lithia Motors include Chrysler, General Motors, Toyota, Subaru, Honda, Acura, Ford, BMW, MINI, Nissan and Hyundai.Four analysts revised their earnings estimate upwards in the last 60 days for fiscal 2021. The Zacks Consensus Estimate has increased $7.02 to $35.11 per share. LAD boasts an average earnings surprise of 28.3%.Analysts are expecting earnings to grow 93% for the current fiscal year, with revenue forecasted to rise 69%.Even more impressive, LAD has gained in value over the past four weeks, up 2.2% compared to the S&P 500's loss of 0.6%.Bottom LineWith a #1 (Strong Buy) ranking, positive trend in earnings estimate revisions, and strong market momentum, Lithia Motors should be on investors' shortlist.If you want even more information on the Zacks Ranks, or one of our many other investing strategies, check out the Zacks Education home page.Discover Today's Top StocksOur private Zacks #1 Rank List, based on our quantitative Zacks Rank stock-rating system, has more than doubled the S&P 500 since 1988. Applying the Zacks Rank in your own trading can boost your investing returns on your very next trade. See Today's Zacks #1 Rank List >> Time to Invest in Legal Marijuana If you’re looking for big gains, there couldn’t be a better time to get in on a young industry primed to skyrocket from $17.7 billion back in 2019 to an expected $73.6 billion by 2027. After a clean sweep of 6 election referendums in 5 states, pot is now legal in 36 states plus D.C. Federal legalization is expected soon and that could be a still greater bonanza for investors. Even before the latest wave of legalization, Zacks Investment Research has recommended pot stocks that have shot up as high as +285.9%. You’re invited to check out Zacks’ Marijuana Moneymakers: An Investor’s Guide. It features a timely Watch List of pot stocks and ETFs with exceptional growth potential.Today, Download Marijuana Moneymakers FREE >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Lithia Motors, Inc. 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Category: topSource: zacksSep 24th, 2021

Futures Slide Alongside Cryptocurrencies Amid China Crackdown

Futures Slide Alongside Cryptocurrencies Amid China Crackdown US futures and European stocks fell amid ongoing nerves over the Evergrande default, while cryptocurrency-linked stocks tumbled after the Chinese central bank said such transactions are illegal. Sovereign bond yields fluctuated after an earlier selloff fueled by the prospect of tighter monetary policy. At 745am ET, S&P 500 e-minis were down 19.5 points, or 0.43%, Nasdaq 100 e-minis were down 88.75 points, or 0.58% and Dow e-minis were down 112 points, or 0.33%. In the biggest overnight news, Evergrande offshore creditors remain in limbo and still haven't received their coupon payment effectively starting the 30-day grace period, while also in China, the State Planner issued a notice on the crackdown of cryptocurrency mining, will strictly prohibit financing for new crypto mining projects and strengthen energy consumption controls of new crypto mining projects. Subsequently, the PBoC issued a notice to further prevent and dispose of the risks from speculating on cryptocurrencies, to strengthen monitoring of risks from crypto trading and such activities are illegal. The news sent the crypto space tumbling as much as 8% while cryptocurrency-exposed stocks slumped in U.S. premarket trading. Marathon Digital (MARA) drops 6.5%, Bit Digital (BTBT) declines 4.7%, Riot Blockchain (RIOT) -5.9%, Coinbase -2.8%. Big banks including JPMorgan, Citigroup, Morgan Stanley and Bank of America Corp slipped about 0.5%, while oil majors Exxon Mobil and Chevron Corp were down 0.4% and 0.3%, respectively, in premarket trading.Mega-cap FAAMG tech giants fell between 0.5% and 0.6%. Nike shed 4.6% after the sportswear maker cut its fiscal 2022 sales expectations and warned of delays during the holiday shopping season. Several analysts lowered their price targets on the maker of sports apparel and sneakers after the company cut its FY revenue growth guidance to mid-single- digits. Here are some of the biggest U.S. movers today: Helbiz (HLBZ) falls 10% after the micromobility company filed with the SEC for the sale of as many as 11m shares by stockholders. Focus Universal (FCUV), an online marketing company that’s been a favorite of retail traders, surged 26% in premarket trading after the stock was cited on Stocktwits in recent days. Vail Resorts (MTN) falls 2.7% in postmarket trading after its full-year forecasts for Ebitda and net income missed at the midpoint. GlycoMimetics (GLYC) jumps 15% postmarket after announcing that efficacy and safety data from a Phase 1/2 study of uproleselan in patients with acute myeloid leukemia were published in the journal Blood on Sept. 16. VTV Therapeutics (VTVT) surges 30% after company says its HPP737 psoriasis treatment showed favorable safety and tolerability profile in a multiple ascending dose study. Fears about a sooner-than-expected tapering amid signs of stalling U.S. economic growth and concerns over a spillover from China Evergrande’s default had rattled investors in September, putting the benchmark S&P 500 index on course to snap a seven-month winning streak. Elaine Stokes, a portfolio manager at Loomis Sayles & Co., told Bloomberg Television, adding that “what they did is tell us that they feel really good about the economy.” While the bond selloff vindicated Treasury bears who argue yields are too low to reflect fundamentals, others see limits to how high they can go. “We’d expected bond yields to go higher, given the macro situation where growth is still very strong,” Sylvia Sheng, global multi-asset strategist with JPMorgan Asset Management, said on Bloomberg Television. “But we do stress that is a modest view, because we think that upside to yields is still limited from here given that central banks including the Fed are still buying bonds.” Still, Wall Street’s main indexes rallied in the past two session and are set for small weekly gains. European equities dipped at the open but trade off worst levels, with the Euro Stoxx 50 sliding as much as 1.1% before climbing off the lows. France's CAC underperformed at the margin. Retail, financial services are the weakest performers. EQT AB, Europe’s biggest listed private equity firm, fell as much as 8.1% after Sweden’s financial watchdog opened an investigation into suspected market abuse. Here are some of the other biggest European movers today: SMCP shares surge as much as 9.9%, advancing for a 9th session in 10, amid continued hopes the financial troubles of its top shareholder will ultimately lead to a sale TeamViewer climbs much as 4.2% after Bankhaus Metzler initiated coverage with a buy rating, citing the company’s above-market growth AstraZeneca gains as much as 3.6% after its Lynparza drug met the primary endpoint in a prostate cancer trial Darktrace drops as much as 9.2%, paring the stock’s rally over the past few weeks, as a technical pattern triggered a sell signal Adidas and Puma fall as much as 4% and 2.9%, respectively, after U.S. rival Nike’s “large cut” to FY sales guidance, which Jefferies said would “likely hurt” shares of European peers Earlier in the session, Asian stocks rose for a second day, led by rallies in Japan and Taiwan, following U.S. peers higher amid optimism over the Federal Reserve’s bullish economic outlook and fading concerns over widespread contagion from Evergrande. Stocks were muted in China and Hong Kong. India’s S&P BSE Sensex topped the 60,000 level for the first time on Friday on optimism that speedier vaccinations will improve demand for businesses in Asia’s third-largest economy. The MSCI Asia Pacific Index gained as much as 0.7%, with TSMC and Sony the biggest boosts. That trimmed the regional benchmark’s loss for the week to about 1%. Japan’s Nikkei 225 climbed 2.1%, reopening after a holiday, pushing its advance for September to 7.7%, the best among major global gauges. The Asian regional benchmark pared its gain as Hong Kong stocks fell sharply in late afternoon trading amid continued uncertainty, with Evergrande giving no sign of making an interest payment that was due Thursday. Among key upcoming events is the leadership election for Japan’s ruling party next week, which will likely determine the country’s next prime minister. “Investor concerns over the Evergrande issue have retreated a bit for now,” said Hajime Sakai, chief fund manager at Mito Securities Co. in Tokyo. “But investors will have to keep downside risk in the corner of their minds.” Indian stocks rose, pushing the Sensex above 60,000 for the first time ever. Key gauges fell in Singapore, Malaysia and Australia, while the Thai market was closed for a holiday. Treasuries are higher as U.S. trading day begins after rebounding from weekly lows reached during Asia session, adding to Thursday’s losses. The 10-year yield was down 1bp at ~1.42%, just above the 100-DMA breached on Thursday for the first time in three months; it climbed to 1.449% during Asia session, highest since July 6, and remains 5.2bp higher on the week, its fifth straight weekly increase. Several Fed speakers are slated, first since Wednesday’s FOMC commentary set forth a possible taper timeline.  Bunds and gilts recover off cheapest levels, curves bear steepening. USTs bull steepen, richening 1.5bps from the 10y point out. Peripheral spreads are wider. BTP spreads widen 2-3bps to Bunds. In FX, the Bloomberg Dollar Spot Index climbed back from a one-week low as concern about possible contagion from Evergrande added to buying of the greenback based on the Federal Reserve tapering timeline signaled on Wednesday. NZD, AUD and CAD sit at the bottom of the G-10 scoreboard. ZAR and TRY are the weakest in EM FX. The pound fell after its rally on Thursday as investors looked ahead to BOE Governor Andrew Bailey’s sPeech next week about a possible interest-rate hike. Traders are betting that in a contest to raise borrowing costs first, the Bank of England will be the runaway winner over the Federal Reserve. The New Zealand and Aussie dollars led declines among Group-of-10 peers. The euro was trading flat, with a week full of events failing “to generate any clear directional move,” said ING analysts Francesco Pesole and Chris Turner. German IFO sentiment indeces will “provide extra indications about the area’s sentiment as  businesses faced a combination of delta variant concerns and lingering supply disruptions”. The Norwegian krone is the best performing currency among G10 peers this week, with Thursday’s announcement from the Norges Bank offering support In commodities, crude futures hold a narrow range up around best levels for the week. WTI stalls near $73.40, Brent near $77.50. Spot gold extends Asia’s gains, adding $12 on the session to trade near $1,755/oz. Base metals are mixed, LME nickel and aluminum drop ~1%, LME tin outperforms with a 2.8% rally. Bitcoin dips after the PBOC says all crypto-related transactions are illegal. Looking to the day ahead now, we’ll hear from Fed Chair Powell, Vice Chair Clarida and the Fed’s Mester, Bowman, George and Bostic, as well as the ECB’s Lane and Elderson, and the BoE’s Tenreyro. Finally, a summit of the Quad Leaders will be held at the White House, including President Biden, and the Prime Ministers of Australia, India and Japan. Market Snapshot S&P 500 futures down 0.3% to 4,423.50 STOXX Europe 600 down 0.7% to 464.18 German 10Y yield fell 8.5 bps to -0.236% Euro little changed at $1.1737 MXAP up 0.4% to 201.25 MXAPJ down 0.5% to 643.20 Nikkei up 2.1% to 30,248.81 Topix up 2.3% to 2,090.75 Hang Seng Index down 1.3% to 24,192.16 Shanghai Composite down 0.8% to 3,613.07 Sensex up 0.2% to 60,031.83 Australia S&P/ASX 200 down 0.4% to 7,342.60 Kospi little changed at 3,125.24 Brent Futures up 0.4% to $77.57/bbl Gold spot up 0.7% to $1,755.38 U.S. Dollar Index little changed at 93.14 Top Overnight News from Bloomberg China Evergrande Group’s unusual silence about a dollar-bond interest payment that was due Thursday has put a focus on what might happen during a 30-day grace period. The Reserve Bank of Australia’s inflation target is increasingly out of step with international counterparts and fails to account for structural changes in the country’s economy over the past 30 years, Westpac Banking Corp.’s Bill Evans said. With central banks from Washington to London this week signaling more alarm over faster inflation, the ultra-stimulative path of the euro zone and some of its neighbors appears lonelier than ever. China’s central bank continued to pump liquidity into the financial system on Friday as policy makers sought to avoid contagion stemming from China Evergrande Group spreading to domestic markets. A more detailed look at global markets courtesy of Newsquawk Asian equity markets traded mixed with the region failing to fully sustain the impetus from the positive performance across global counterparts after the silence from Evergrande and lack of coupon payments for its offshore bonds, stirred uncertainty for the company. ASX 200 (-0.4%) was negative as underperformance in mining names and real estate overshadowed the advances in tech and resilience in financials from the higher yield environment. Nikkei 225 (+2.1%) was the biggest gainer overnight as it played catch up to the prior day’s recovery on return from the Autumnal Equinox holiday in Japan and with exporters cheering the recent risk-conducive currency flows, while KOSPI (-0.1%) was lacklustre amid the record daily COVID-19 infections and after North Korea deemed that it was premature to declare that the Korean War was over. Hang Seng (-1.2%) and Shanghai Comp. (-0.8%) were indecisive after further liquidity efforts by the PBoC were offset by concerns surrounding Evergrande after the Co. failed to make coupon payments due yesterday for offshore bonds but has a 30-day grace period with the Co. remaining quiet on the issue. Finally, 10yr JGBs were lower on spillover selling from global counterparts including the declines in T-notes as the US 10yr yield breached 1.40% for the first time since early-July with the pressure in bonds also stemming from across the Atlantic following a more hawkish BoE, while the presence of the BoJ in the market today for over JPY 1.3tln of government bonds with 1yr-10yr maturities did very little to spur prices. Top Asian News Rivals for Prime Minister Battle on Social Media: Japan Election Asian Stocks Rise for Second Day, Led by Gains in Japan, Taiwan Hong Kong Stocks Still Wagged by Evergrande Tail Hong Kong’s Hang Seng Tech Index Extends Decline to More Than 2% European equities (Stoxx 600 -0.9%) are trading on the back foot in the final trading session of the week amid further advances in global bond yields and a mixed APAC handover. Overnight, saw gains for the Nikkei 225 of 2.1% with the index aided by favourable currency flows, whilst Chinese markets lagged (Shanghai Comp. -0.8%, Hang Seng -1.6%) with further liquidity efforts by the PBoC offset by concerns surrounding Evergrande after the Co. failed to make coupon payments due yesterday for offshore bonds. As context, despite the losses in Europe today, the Stoxx 600 is still higher by some 1.2% on the week. Stateside, futures are also on a softer footing with the ES down by 0.4% ahead of a busy Fed speaker schedule. Back to Europe, sectors are lower across the board with Retail and Personal & Household Goods lagging peers. The former has been hampered by losses in Adidas (-3.0%) following after hours earnings from Nike (-4.2% pre-market) which saw the Co. cut its revenue guidance amid supply chain woes. AstraZeneca (+2.1%) sits at the top of the FTSE 100 after announcing that the Lynparza PROpel trial met its primary endpoint. Daimler’s (+0.1%) Mercedes-Benz has announced that it will take a 33% stake in a battery cell manufacturing JV with Total and Stellantis. EQT (-6.5%) sits at the foot of the Stoxx 600 after the Swedish FSA announced it will open an investigation into the Co. Top European News EQT Investigated by Sweden’s FSA Over Suspected Market Abuse Gazprom Says Claims of Gas Under-supply to Europe Are ‘Absurd’ German Sept. Ifo Business Confidence 98.8; Est. 99 German Business Index at Five-Month Low in Pre-Election Verdict In FX, the rot seems to have stopped for the Buck in terms of its sharp and marked fall from grace amidst post-FOMC reflection and re-positioning in the financial markets on Thursday. Indeed, the Dollar index has regained some poise to hover above the 93.000 level having recoiled from 93.526 to 92.977 over the course of yesterday’s hectic session that saw the DXY register a marginal new w-t-d high and low at either end of the spectrum. Pre-weekend short covering and consolidation may be giving the Greenback a lift, while the risk backdrop is also less upbeat ahead of a raft of Fed speakers flanking US new home sales data. Elsewhere, the Euro remains relatively sidelined and contained against the Buck with little independent inspiration from the latest German Ifo survey as the business climate deteriorated broadly in line with consensus and current conditions were worse than forecast, but business expectations were better than anticipated. Hence, Eur/Usd is still stuck in a rut and only briefly/fractionally outside 1.1750-00 parameters for the entire week, thus far, as hefty option expiry interest continues to keep the headline pair in check. However, there is significantly less support or gravitational pull at the round number today compared to Thursday as ‘only’ 1.3 bn rolls off vs 4.1 bn, and any upside breach could be capped by 1.1 bn between 1.1765-85. CAD/NZD/AUD - Some payback for the non-US Dollars following their revival, with the Loonie waning from 1.2650+ peaks ahead of Canadian budget balances, though still underpinned by crude as WTI hovers around Usd 73.50/brl and not far from decent option expiries (from 1.2655-50 and 1.2625-30 in 1.4 bn each). Similarly, the Kiwi has faded after climbing to within single digits of 0.7100 in wake of NZ trade data overnight revealing a much wider deficit as exports slowed and imports rose, while the Aussie loses grip of the 0.7300 handle and skirts 1.1 bn option expiries at 0.7275. CHF/GBP/JPY - The Franc is fairly flat and restrained following a dovish SNB policy review that left in lagging somewhat yesterday, with Usd/Chf and Eur/Chf straddling 0.9250 and 1.0850 respectively, in contrast to Sterling that is paring some hawkish BoE momentum, as Cable retreats to retest bids circa 1.3700 and Eur/Gbp bounces from sub-0.8550. Elsewhere, the Yen has not been able to fend off further downside through 110.00 even though Japanese participants have returned to the fray after the Autumn Equinox holiday and reports suggest some COVID-19 restrictions may be lifted in 13 prefectures on a trial basis. SCANDI/EM/PM/CRYPTO - A slight change in the pecking order in Scandi-land as the Nok loses some post-Norges Bank hike impetus and the Sek unwinds a bit of its underperformance, but EM currencies are bearing the brunt of the aforementioned downturn in risk sentiment and firmer Usd, with the Zar hit harder than other as Gold is clings to Usd 1750/oz and Try down to deeper post-CBRT rate cut lows after mixed manufacturing sentiment and cap u readings. Meanwhile, Bitcoin is being shackled by the latest Chinese crackdown on mining and efforts to limit risks from what it describes as unlawful speculative crypto currency trading. In commodities, WTI and Brent are set the conclude the week in the green with gains in excess of 2% for WTI at the time of writing; in-spite of the pressure seen in the complex on Monday and the first-half of Tuesday, where a sub USD 69.50/bbl low was printed. Fresh newsflow has, once again, been limited for the complex and continues to focus on the gas situation. More broadly, no update as of yet on the Evergrande interest payment and by all accounts we appear to have entered the 30-day grace period for this and, assuming catalysts remain slim, updates on this will may well dictate the state-of-play. Schedule wise, the session ahead eyes significant amounts of central bank commentary but from a crude perspective the weekly Baker Hughes rig count will draw attention. On the weather front, Storm Sam has been upgraded to a Hurricane and is expected to rapidly intensify but currently remains someway into the mid-Atlantic. Moving to metals, LME copper is pivoting the unchanged mark after a mixed APAC lead while attention is on Glencore’s CSA copper mine, which it has received an offer for; the site in 2020 produced circa. 46k/T of copper which is typically exported to Asia smelters. Elsewhere, spot gold and silver are firmer but have been very contained and remain well-within overnight ranges thus far. Which sees the yellow metal holding just above the USD 1750/oz mark after a brief foray below the level after the US-close. US Event Calendar 10am: Aug. New Home Sales MoM, est. 1.0%, prior 1.0% 10am: Aug. New Home Sales, est. 715,000, prior 708,000 Central Bank Speakers 8:45am: Fed’s Mester Discusses the Economic Outlook 10am: Powell, Clarida and Bowman Host Fed Listens Event 10:05am: Fed’s George Discusses Economic Outlook 12pm: Fed’s Bostic Discusses Equitable Community Development DB's Jim Reid concludes the overnight wrap WFH today is a bonus as it’s time for the annual ritual at home where the latest, sleekest, shiniest iPhone model arrives in the post and i sheepishly try to justify to my wife when I get home why I need an incremental upgrade. This year to save me from the Spanish Inquisition I’m going to intercept the courier and keep quiet. Problem is that such speed at intercepting the delivery will be logistically challenging as I remain on crutches (5 weeks to go) and can’t grip properly with my left hand due to an ongoing trapped nerve. I’m very glad I’m not a racehorse. Although hopefully I can be put out to pasture in front of the Ryder Cup this weekend. The big news of the last 24 hours has been a galloping global yield rise worthy of the finest thoroughbred. A hawkish Fed meeting, with the dots increasing and the end of QE potentially accelerated, didn’t quite have the ability to move markets but the global dam finally broke yesterday with Norway being the highest profile developed country to raise rates this cycle (expected), but more importantly a Bank of England meeting that saw the market reappraise rate hikes. Looking at the specific moves, yields on 10yr Treasuries were up +13.0bps to 1.430% in their biggest daily increase since 25 February, as both higher real rates (+7.9bps) and inflation breakevens (+4.9bps) drove the advance. US 10yr yields had been trading in a c.10bp range for the last month before breaking out higher, though they have been trending higher since dropping as far as 1.17% back in early-August. US 30yr yields rose +13.2bps, which was the biggest one day move in long dated yields since March 17 2020, which was at the onset of the pandemic and just days after the Fed announced it would be starting the current round of QE. The large selloff in US bonds saw the yield curve steepen and the long-end give back roughly half of the FOMC flattening from the day before. The 5y30y curve steepened 3.4bps for a two day move of -3.3bps. However the 2y10y curve steepened +10.5bps, completely reversing the prior day’s flattening (-4.2bps) and leaving the spread at 116bp, the steepest level since first week of July. 10yr gilt yields saw nearly as strong a move (+10.8bps) with those on shorter-dated 2yr gilts (+10.7bps) hitting their highest level (0.386%) since the pandemic began.That came on the back of the BoE’s latest policy decision, which pointed in a hawkish direction, building on the comment in the August statement that “some modest tightening of monetary policy over the forecast period is likely to be necessary” by saying that “some developments during the intervening period appear to have strengthened that case”. The statement pointed out that the rise in gas prices since August represented an upside risks to their inflation projections from next April, and the MPC’s vote also saw 2 members (up from 1 in August) vote to dial back QE. See DB’s Sanjay Raja’s revised rate hike forecasts here. We now expect a 15bps hike in February. The generalised move saw yields in other European countries rise as well, with those on 10yr bunds (+6.6bps), OATs (+6.5bps) and BTPs (+5.7bps) all seeing big moves higher with 10yr bunds seeing their biggest climb since late-February and back to early-July levels as -0.258%. The yield rise didn’t stop equity indices recovering further from Monday’s rout, with the S&P 500 up +1.21% as the index marked its best performance in over 2 months, and its best 2-day performance since May. Despite the mood at the end of the weekend, the S&P now starts Friday in positive territory for the week. The rally yesterday was led by cyclicals for a second straight day with higher commodity prices driving outsized gains for energy (+3.41%) and materials (+1.39%) stocks, and the aforementioned higher yields causing banks (+3.37%) and diversified financials (+2.35%) to outperform. The reopening trade was the other main beneficiary as airlines rose +2.99% and consumer services, which include hotel and cruiseline companies, gained +1.92%. In Europe, the STOXX 600 (+0.93%) witnessed a similarly strong performance, with index led by banks (+2.16%). As a testament to the breadth of yesterday’s rally, the travel and leisure sector (+0.04%) was the worst performing sector on this side of the Atlantic even while registering a small gain and lagging its US counterparts. Before we get onto some of yesterday’s other events, it’s worth noting that this is actually the last EMR before the German election on Sunday, which has long been signposted as one of the more interesting macro events on the 2021 calendar, the results of which will play a key role in not just domestic, but also EU policy. And with Chancellor Merkel stepping down after four terms in office, this means that the country will soon be under new management irrespective of who forms a government afterwards. It’s been a volatile campaign in many respects, with Chancellor Merkel’s CDU/CSU, the Greens and the centre-left SPD all having been in the lead at various points over the last six months. But for the last month Politico’s Poll of Polls has shown the SPD consistently ahead, with their tracker currently putting them on 25%, ahead of the CDU/CSU on 22% and the Greens on 16%. However the latest poll from Forschungsgruppe Wahlen yesterday suggested a tighter race with the SPD at 25, the CDU/CSU at 23% and the Greens at 16.5%. If the actual results are in line with the recent averages, it would certainly mark a sea change in German politics, as it would be the first time that the SPD have won the popular vote since the 2002 election. Furthermore, it would be the CDU/CSU’s worst ever result, and mark the first time in post-war Germany that the two main parties have failed to win a majority of the vote between them, which mirrors the erosion of the traditional big parties in the rest of continental Europe. For the Greens, 15% would be their best ever score, and exceed the 9% they got back in 2017 that left them in 6th place, but it would also be a disappointment relative to their high hopes back in the spring, when they were briefly polling in the mid-20s after Annalena Baerbock was selected as their Chancellor candidate. In terms of when to expect results, the polls close at 17:00 London time, with initial exit polls released immediately afterwards. However, unlike the UK, where a new majority government can immediately come to power the day after the election, the use of proportional representation in Germany means that it could potentially be weeks or months before a new government is formed. Indeed, after the last election in September 2017, it wasn’t until March 2018 that the new grand coalition between the CDU/CSU and the SPD took office, after attempts to reach a “Jamaica” coalition between the CDU/CSU, the FDP and the Greens was unsuccessful. In the meantime, the existing government will act as a caretaker administration. On the policy implications, it will of course depend on what sort of government is actually formed, but our research colleagues in Frankfurt have produced a comprehensive slidepack (link here) running through what the different parties want across a range of policies, and what the likely coalitions would mean for Germany. They also put out another note yesterday (link here) where they point out that there’s still much to play for, with the SPD’s lead inside the margin of error and with an unusually high share of yet undecided voters. Moving on to Asia and markets are mostly higher with the Nikkei (+2.04%), CSI (+0.53%) and India’s Nifty (+0.52%) up while the Hang Seng (-0.03%), Shanghai Comp (-0.07%) and Kospi (-0.10%) have all made small moves lower. Meanwhile, the Evergrande group missed its dollar bond coupon payment yesterday and so far there has been no communication from the group on this. They have a 30-day grace period to make the payment before any event of default can be declared. This follows instructions from China’s Financial regulators yesterday in which they urged the group to take all measures possible to avoid a near-term default on dollar bonds while focusing on completing unfinished properties and repaying individual investors. Yields on Australia and New Zealand’s 10y sovereign bonds are up +14.5bps and +11.3bps respectively this morning after yesterday’s move from their western counterparts. Yields on 10y USTs are also up a further +1.1bps to 1.443%. Elsewhere, futures on the S&P 500 are up +0.04% while those on the Stoxx 50 are down -0.10%. In terms of overnight data, Japan’s August CPI printed at -0.4% yoy (vs. -0.3% yoy expected) while core was unchanged in line with expectations. We also received Japan’s flash PMIs with the services reading at 47.4 (vs. 42.9 last month) while the manufacturing reading came in at 51.2 (vs. 52.7 last month). In pandemic related news, Jiji reported that Japan is planning to conduct trials of easing Covid restrictions, with 13 prefectures indicating they’d like to participate. This is likely contributing to the outperformance of the Nikkei this morning. Back to yesterday now, and one of the main highlights came from the flash PMIs, which showed a continued deceleration in growth momentum across Europe and the US, and also underwhelmed relative to expectations. Running through the headline numbers, the Euro Area composite PMI fell to 56.1 (vs. 58.5 expected), which is the lowest figure since April, as both the manufacturing (58.7 vs 60.3 expected) and services (56.3 vs. 58.5 expected) came in beneath expectations. Over in the US, the composite PMI fell to 54.5 in its 4th consecutive decline, as the index hit its lowest level in a year, while the UK’s composite PMI at 54.1 (vs. 54.6 expected) was the lowest since February when the country was still in a nationwide lockdown. Risk assets seemed unperturbed by the readings, and commodities actually took another leg higher as they rebounded from their losses at the start of the week. The Bloomberg Commodity Spot index rose +1.12% as Brent crude oil (+1.39%) closed at $77.25/bbl, which marked its highest closing level since late 2018, while WTI (+1.07%) rose to $73.30/bbl, so still a bit beneath its recent peak in July. However that is a decent rebound of roughly $11/bbl since its recent low just over a month ago. Elsewhere, gold (-1.44%) took a knock amidst the sharp move higher in yields, while European natural gas prices subsidised for a third day running, with futures now down -8.5% from their intraday peak on Tuesday, although they’re still up by +71.3% since the start of August. US negotiations regarding the upcoming funding bill and raising the debt ceiling are ongoing, with House Speaker Pelosi saying that the former, also called a continuing resolution, will pass “both houses by September 30,” and fund the government through the first part of the fiscal year, starting October 1. Treasury Secretary Yellen has said the US will likely breach the debt ceiling sometime in the next month if Congress does not increase the level, and because Republicans are unwilling to vote to raise the ceiling, Democrats will have to use the once-a-fiscal-year tool of budget reconciliation to do so. However Democrats, are also using that process for the $3.5 trillion dollar economic plan that makes up the bulk of the Biden agenda, and have not been able to get full party support yet. During a joint press conference with Speaker Pelosi, Senate Majority Leader Schumer said that Democrats have a “framework” to pay for the Biden Economic agenda, which would imply that the broad outline of a deal was reached between the House, Senate and the White House. However, no specifics were mentioned yesterday. With Democrats looking to vote on the bipartisan infrastructure bill early next week, negotiations today and this weekend on the potential reconciliation package will be vital. Looking at yesterday’s other data, the weekly initial jobless claims from the US for the week through September 18 unexpectedly rose to 351k (vs. 320k expected), which is the second week running they’ve come in above expectations. Separately, the Chicago Fed’s national activity index fell to 0.29 in August (vs. 0.50 expected), and the Kansas City Fed’s manufacturing activity index also fell more than expected to 22 in September (vs. 25 expected). To the day ahead now, and data highlights include the Ifo’s business climate indicator from Germany for September, along with Italian consumer confidence for September and US new home sales for August. From central banks, we’ll hear from Fed Chair Powell, Vice Chair Clarida and the Fed’s Mester, Bowman, George and Bostic, as well as the ECB’s Lane and Elderson, and the BoE’s Tenreyro. Finally, a summit of the Quad Leaders will be held at the White House, including President Biden, and the Prime Ministers of Australia, India and Japan. Tyler Durden Fri, 09/24/2021 - 08:12.....»»

Category: blogSource: zerohedgeSep 24th, 2021

Make the Most of Soaring Natural Gas Prices with These 5 Plays

Soaring energy prices and cheap valuations make this group attractive. Natural gas prices have been rising this year. The reason, according to the U.S. Energy Information Administration (EIA) is a warmer-than-usual summer that boosted electricity consumption for air conditioning, increased liquid natural gas (LNG) exports and flat production, which in combination led to a lower inventory build for the winter. The fact that hurricane Ida disrupted production in August also didn’t help.The other contributing factor was that natural gas prices typically rise in times of economic expansion, because of its use in the commercial sector, as well as processing in several industrial segments like chemicals, fertilizers, paper and glass. And we know how rapidly the economy has turned around.It’s now expected that prices will remain elevated through the winter because of the low inventories and increased demand from consumer, commercial and industrial users. And that is despite electric power consumption dropping an estimated 8.3% this year as the sector shifts some consumption to coal (the usual fallback when prices continue to rise). The electric power sector is the largest end-use case for natural gas, and it’s highly sensitive to prices. Less elastic demand comes from things like lease and plant fuel, pipeline and distribution use, and vehicle use and these segments are likely to see steady growth through 2022.The EIA estimates that despite increased production, natural gas inventories will be 5% below the 5-year average at the end of the 2021 injection season (October-end). Next year, demand from electricity suppliers will fall further, as additional clean energy sources come online.Important NumbersHenry Hub spot prices in August were $1.77 per million British thermal units (MMBtu) higher than in August 2020.U.S. consumption of natural gas will average 82.5 billion cubic feet per day (Bcf/d) in 2021, down 0.9% from 2020, remaining more or less steady at 82.6 Bcf/d in 2022.Residential and commercial natural gas consumption combined will rise by 1.2 Bcf/d, industrial consumption will rise by 0.6 Bcf/d and the electric power sector’s consumption will drop by 2.7 Bcf/d, or 8.3% in 2021.Dry natural gas production will average 92.7 Bcf/d in the U.S. during 2H21—up from 91.7 Bcf/d in 1H21—and then rise to 95.4 Bcf/d in 2022.U.S. natural gas inventories ended August 2021 at about 2.9 trillion cubic feet (Tcf); inventories will end the 2021 injection season (end of October) at almost 3.6 Tcf, which would be 5% below the five-year average.LNG ExportsSince the U.S. is more or less replete in natural gas resource, the domestic market is well-developed with consumption balancing production more often than not, leading to low and steady prices. But the last few years have seen increased recognition across the world of LNG as a clean fuel and countries like China have made it part of their clean energy strategy. The high demand in Europe and Asia has sent global prices soaring, which in turn has encouraged U.S. manufacturers to export. The expansion of the domestic LNG market is changing the operating dynamics with the potential for prices to rise and stay higher in the future (because of increased international demand).Most players are involved in both natural gas and crude operations, although there’s an increased focus on natural gas of late.Let’s consider a few cases-Cheniere Energy, Inc. LNGHouston, TX-based Cheniere Energy is primarily engaged in businesses related to liquefied natural gas (or LNG) through its two business segments: LNG terminal and LNG and natural gas marketing. The company, through its controlling interest in Cheniere Energy Partners L.P., owns and operates the Sabine Pass LNG terminal in Louisiana – North America’s first large-scale liquefied gas export facility. Furthermore, Cheniere Energy owns and operates the 94-mile Creole Trail Pipeline – an interconnect between the Sabine Pass receiving terminal and the downstream markets – through its subsidiary.Cheniere Energy intends to construct up to six trains at Sabine Pass with each train expected to have a capacity of about 4.5 million tons per annum. While Trains 1, 2, 3 and 4 are functional; Train 5 is undergoing commissioning. Train 6 is being commercialized and has secured the necessary regulatory approvals.Cheniere Energy Partners is also developing a liquefaction and export terminal in Corpus Christi, TX. Train 1 commissioning is complete, Train 2 is under construction and Train 3 is commercialised with necessary approvals in place. The facility came online in 2019. Cheniere Energy intends to develop seven midscale liquefaction trains adjacent to the Corpus Christi Liquefaction facility (CCL). The company has initiated the regulatory approval process. The total production capacities for these trains are expected to be approximately 9.5 Mtpa.Additionally, Cheniere Energy is involved in LNG and natural gas marketing activities through its subsidiary, Cheniere Marketing LLC.Global LNG demand is likely to continue growing for the next few years. Cheniere Energy, the U.S.’s only listed LNG export pure play, foresees the fundamentals of LNG to be favorable in the long run, considering the secular shift to the cleaner burning fuel for power generation worldwide and in the Asia-Pacific region in particular. While the increasing demand for gas in the European power sector will be a key factor driving near-term LNG supply, longer-term consumption is set to come from Asian importers like China, India, South Korea and Pakistan.Being in the expansion phase of a capital-intensive business isn’t easy and the company has acquired a significant amount of debt. At the same time, its long-term contracts ensure steady cash flow and provide excellent visibility into the future.It’s therefore particularly encouraging that Cheniere’s expected earnings growth of 976.5% this year and 119.7% next year are significantly higher than its expected revenue growth of 46.4% and 13.6%. After a correction 30 days ago, its estimates are again on the rise.The shares carry a Zacks Rank #2 (Buy) and at 16.1X P/E, they’re trading below their median level over the past year. Definitely worth considering.Range Resources Corp. RRCBased in Fort Worth, TX, Range Resources is an independent oil and gas company engaged in the exploration, development and acquisition of oil and gas properties, primarily in the Appalachian Basin and North Louisiana. It is among the top 10 natural gas producers in the U.S. and is among the top NGL producers in the domestic market.The Appalachian Basin incorporates prolific acreages in Marcellus, Utica and Upper Devonian shale formations. In the Marcellus formation of the basin, it has a multi-decade inventory of premium drilling locations. Of the 3,100 undrilled wells in the region, 2,600 wells are liquids-rich and the rest have a natural gas predominance. Following the merger with Memorial Resource Development Corporation a few years back, Range Resources created a core acreage position in North Louisiana comprising 140,000 net acers with multiple formations of productive oil and natural gas.The company primarily sells its produced natural gas to midstream firms, utilities, marketing companies and industrial users. It also sells natural gas liquids (NGLs) and crude oil.As of Dec 31, 2020, total proved reserves were 17.2 trillion cubic feet equivalent (Tcfe), almost flat year over year. Around 95% of the company’s total proved reserves are located in the Marcellus region. Of the total proved reserves, roughly 57% was developed.Despite its considerable liquid resources, the company has been focusing on natural gas production because of growing global demand for clean energy. In 2020, its total production averaged 2.23 million cubic feet equivalent per day, of which 69.4% was natural gas. A similar trend is seen this year.Range Resources’ revenue is expected to grow 38.9% in 2021 and 3.6% in 2022. Earnings are expected to increase 2000% and 45.5%, respectively in the two years. Estimates for both years have been rising steadily: the 2021 estimate increased 47.4% in the last 90 days while the 2022 estimate increased 93.0%.The shares carry a Zacks Rank #1 (Strong Buy). At 8.7X P/E, they’re trading below their median level over the past year, making them really cheap at these levels.Continental Resources, Inc. CLROklahoma City, OK-based Continental Resources is an explorer and producer of oil and natural gas. The company operates premium resources in the North Dakota Bakken and Montana Bakken (among the country’s largest onshore oilfields) in northern U.S., the SCOOP and STACK plays of Oklahoma in southern U.S. and undeveloped leasehold acreage in eastern U.S. It also has strategic water assets in Bakken and Oklahoma.Given its presence in prolific regions, the company expects oil equivalent production growth of 8-10% CAGR from 2019 to 2023 which is expected to translate to average annual free cash flow of $3.5-$4 billion over the five-year period.At the end of 2020, the company’s estimated proved reserves were 1,103.8 MMBoe. During 2020, the company produced 300,090 barrels of oil equivalent per day (Boe/d), lower than 340,395 Boe/d in the year-ago quarter. Of the total production, oil accounted for nearly 58.2%.The company’s 2021 revenue and earnings are currently expected to grow 101.9% and 436.8%, respectively. While analysts still expect 2022 growth to be negative, estimates for both years continue to increase substantially (from $2.35 to $3.94 in 2021 and from $1.97 to $3.68 in 2022). The stronger pricing this year is clearly driving the numbers.The shares of this Zacks Rank #1 company are currently trading at a P/S of 2.99X, which is between their median and high values over the past year, although much lower than the S&P 500. While not cheap, they can’t be considered expensive either.Goodrich Petroleum Corp. GDPHouston, Texas-based Goodrich Petroleum is an exploration and production company. It primarily holds interests in the Haynesville Shale Trend in northwest Louisiana and East Texas; Tuscaloosa Marine Shale Trend located in southwest Mississippi and southeast Louisiana; and the Eagle Ford Shale Trend in South Texas. The company owns interests in 189 producing oil and natural gas wells located in 37 fields in six states of the United States.As of December 31, 2020, it had estimated proved reserves of approximately 543 billion cubic feet equivalent, which included 540 billion cubic feet of natural gas and 0.5 million barrels of crude oil or other liquid hydrocarbons of oil and condensate.The company’s revenues are expected to grow 60.5% this year and another 22.4% in the next. Its earnings are expected to grow 1676.2% this year followed by 25.3% growth in the next. Estimates for both years are galloping ahead. In the past 90 days, they’ve gone from $2.17 to 3.73 for 2021 and from 2.74 to 4.67 for 2022.Shares of this Zacks Rank #1 stock currently trade at 4.9X P/E, which is below their median level over the past year, and of course much lower than the S&P. They’re a steal at these levels.Magnolia Oil & Gas Corp. MGYMagnolia Oil & Gas is an independent upstream operator engaged in the exploration, development and production of natural gas, crude oil and natural gas liquids. Headquartered in Houston, TX, the firm is focused on the high-quality Eagle Ford Shale and Austin Chalk formations in South Texas.In South Texas, Magnolia’s position consists of more than 460,000 net acres, of which around 23,500 net acres are located in the highly productive Karnes County and nearly 440,000 net acres in the re-emerging Giddings Field.At Dec 31, 2020, Magnolia's total estimated proved reserves were 49.3 million barrels ((MMBbls) of oil, 28.5 MMBbls of natural gas liquids (“NGL”) and 207.6 billion cubic feet (Bcf) of natural gas, totaling 112.3 million barrels of oil-equivalent (MMboe) — 69% liquids, 76% developed.The company focuses on growth through a combination of acquisitions and active drilling. Since its inception in 2018, Magnolia has spent around 60% of operating cash flow on capital expenditures, 26% on acquisitions, 8% on stock buybacks, while preserving the remaining 6% as cash. In particular, Magnolia is focused on returning significant cash to its shareholders: it aims to repurchase 1% of its total scrips outstanding each quarter and introduce a semi-annual cash dividend in 2021.Given the COVID-related disruption in 2020, it’s understandable that revenue and earnings are expected to jump 88.7% and 10050% this year. But the 6.7% revenue growth and flattish earnings slated for the following year are particularly encouraging.The Zacks Rank #1 shares are trading cheap at 8.23X earnings (below median level of 12.09X over the past year). One-Month Price PerformanceImage Source: Zacks Investment Research More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Range Resources Corporation (RRC): Free Stock Analysis Report Cheniere Energy, Inc. (LNG): Free Stock Analysis Report Continental Resources, Inc. (CLR): Free Stock Analysis Report Goodrich Petroleum Corporation (GDP): Free Stock Analysis Report Magnolia Oil & Gas Corp (MGY): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

: Lockheed Martin raises dividend by nearly 8%, buybacks by $5 billion

Lockheed Martin Corp. LMT said late Thursday its board raised its dividend and its authority to buy back stock. The aerospace company said its fourth-quarter dividend of $2.80 a share represents a 7.6% increase and is payable Dec. 27 to shareholders as of Dec.1. The board also authorized an additional $5 billion of share buyback power, raising the company’s total authority to $6 billion. Lockheed Martin shares were up 0.5% after hours, following a 0.7% rise in the regular session to $344.20. Shares have fallen 10% over the past 12 months, compared with a 37% gain on the S&P 500 index SPX.Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news......»»

Category: topSource: marketwatchSep 23rd, 2021

Toll Brothers (TOL) Down 5.1% Since Last Earnings Report: Can It Rebound?

Toll Brothers (TOL) 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 Toll Brothers (TOL). Shares have lost about 5.1% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Toll Brothers due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts. Toll Brothers Q3 Earnings & Revenues Top, Margin UpToll Brothers, Inc. reported strong third-quarter fiscal 2021 (ended Jul 31, 2021) results. Both the top and bottom lines topped the Zacks Consensus Estimate and increased significantly on a year-over-year basis. The company has been benefiting from its strategy of broadening the product lines, price points and geographies.Douglas C. Yearley, Jr., chairman and chief executive officer, said, “Demand continues to be very strong. Net signed contracts were up 35% in dollars to approximately $3 billion compared to the prior year period. The housing market is being driven by many strong fundamentals, including low mortgage rates, favorable millennial-driven demographics, a decade of pent-up demand, low new home supply, and a tight resale market. We expect strong and sustainable demand for our homes in the years to come.”He continued, “Our record backlog, our focus on capital and operating efficiency, and the continued strength of the housing market give us confidence that our full FY 2022 margins will significantly exceed the strong margins we project for our FY 2021 fourth quarter and that our return on beginning equity will exceed 20% in FY 2022 and beyond.”On Aug, 24, 2021, Toll Brothers announced a strategic partnership with Equity Residential to selectively acquire and develop sites for new rental apartment communities in Metro Boston, MA; Atlanta, GA; Austin, TX; Denver, CO; Orange County/San Diego, CA; Seattle, WA, and Dallas-Fort Worth, TX.Earnings & Revenue DiscussionThe country’s leading luxury homebuilder reported earnings of $1.87 per share, surpassing the Zacks Consensus Estimate of $1.52 by 23%. Also, the said figure grew 74.4% from the year-ago figure of 90 cents per share as a result of higher revenues and margins.Revenues of $2.26 billion topped the consensus mark of $2.22 billion by 1.7% and increased 26.8% year over year, backed by solid demand during the quarter.Segment DetailToll Brothers operates under two reportable segments, namely Traditional Home Building and Urban Infill ("City Living").Revenues from Traditional Home Building totaled $2.15 billion, up 28.1% year over year, and that of City Living increased more than 594% to $184 million.Inside the Headline NumbersHome sales revenues grew 37% from the prior year to $2.23 billion. Homes delivered grew 28% year over year to 2,597 units. Deliveries increased in all regions served by the company. The average price of homes delivered was $806,600 for the quarter, up 1.7% from the year-ago level of $793,100.The number of net signed contracts for the reported quarter was 3,154 units, up 11% year over year. The value of net signed contracts was $2.98 billion, reflecting a rise of 35% from the year-ago quarter. These marked record third-quarter numbers.At fiscal third quarter-end, Toll Brothers had a backlog of 10,661 homes, representing a 47% year-over-year increase. Also, potential revenues from backlog improved 55% year over year to $9.44 billion. Backlog for the quarter, in both dollars and units, marked an all-time record high. The average price of homes in backlog totaled $885,200, up from $840,600 at the end of the comparable period of fiscal 2020.Cancellation rate for the reported quarter was 3.1% compared with 8% in the prior-year period.MarginsThe company’s home sales adjusted gross margin was 25.6%, expanding 170 basis points (bps) for the quarter.SG&A expenses — as a percentage of home sales revenues — were 10.5%, which decreased from 11.9% in the year-ago quarter.FinancialsToll Brothers had $946 million cash and cash equivalents as of Jul 31, 2021 compared with $1.37 billion at fiscal 2020-end. At fiscal third quarter-end, it had $1.79 billion available under the $1.905-billion bank revolving credit facility, scheduled to mature in November 2025.Total debt at fiscal third quarter-end was $3.59 billion, down from $3.96 billion at fiscal 2020-end. Debt to capital was 41.6% at fiscal third quarter-end versus 44.8% a year ago.During the quarter, the company repurchased nearly 1.7 million shares of its common stock at an average price of $57.66 per share for approximately $95.4 million.Fiscal Fourth-Quarter GuidanceToll Brothers expects home deliveries of 3,450 units (indicating an improvement from 2,940 units delivered in the prior-year quarter) at an average price of $840,000 (suggesting a rise from $805,000 a year ago).Adjusted home sales gross margin is now expected to be 25.6% (up from prior projection of 24.8), implying an increase from 21.9% in the year-ago period. SG&A expenses are estimated to be 9.8% of home sales revenues (pointing to fall from 9.9% a year ago). The projection has improved from prior expectation of 11.6%. The company expects effective tax rate to be 26%.Fiscal 2021 GuidanceFor full-year fiscal 2021, home deliveries are now anticipated to be 10,100 units (indicating an improvement from 8,496 units reported in fiscal 2020) at an average price of $830,000. Average price in the year-ago quarter was $816,500.Toll Brothers expects adjusted home sales gross margin of 24.9% (reflecting a marginal increase from 24.6% projected earlier). The current projection implies growth from 23.5% recorded in the year-ago period. SG&A expenses, as a percentage of home sales revenues, for full-year fiscal 2021 are projected to be 11.3% (suggesting fall from 12.5% in fiscal 2020). The current estimate reflects a decrease from the prior projection of 11.8%.How Have Estimates Been Moving Since Then?It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 5.27% due to these changes.VGM ScoresAt this time, Toll Brothers has a nice Growth Score of B, though it is lagging a bit on the Momentum Score front with a C. However, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Toll Brothers has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Toll Brothers Inc. (TOL): Free Stock Analysis Report To read this article on Zacks.com click here......»»

Category: topSource: zacksSep 23rd, 2021

Vistra (VST) Increases Greenhouse Gas Emission Reduction Target

Vistra (VST) continues on its journey to achieve net-zero emission by 2050 and is well placed to reach its new emission reduction milestone set for 2030 from the 2010 baseline. Vistra Corp. VST has raised its greenhouse gas emission reduction target set for 2030 from the 2010 baseline. In 2020, the company set an emission reduction target of net zero by 2050 and lowered emission by 45% in the year from the 2010 levels. Currently, the company targets to achieve a 60% reduction in its Scope 1 and Scope 2 CO2 equivalent emissions by 2030 from the 2010 baseline. This new emission reduction target will assist the company to meet in net-zero carbon emission goal set for 2050.Path to Net-Zero EmissionVistra has already chalked out detailed plans for the transformation of its existing generation portfolio and is focused to add more clean assets in generation. At present, the company has nearly 4,000 megawatt (MW) of zero-carbon generation online or under development.  Vistra aims to add 9,000 MW of zero-emission generation in its production portfolio by 2030. The company will invest in solar plants and battery storage projects.Vistra has plans to shut down nearly 8,000 MW of its coal-fueled power plants by 2027 to reduce emission from its electricity generation process. By 2030, the company targets to produce nearly 90% of its electricity from low to zero carbon emission sources.Transition in Utility SpaceA clear transition is evident in the Utility space of the United States as an increasing number of utility operators on their own are setting net-zero emission targets in electricity production.  Per the International Energy Agency, to reach net-zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around $4 trillion. Utilities are making investment to adopt clean energy sources and are trying to find and produce electricity from commercially viable clean sources.   The ongoing development in technology and research and development, alternate sources of energy like wind, water, and solar power are being utilized to produce energy. The supportive legislation of the U.S. government has helped in the development and usage of clean energy sources.  Nuclear energy is also a clean energy source and with government support can be a solution to the emission problem. It generated more than 50% emission-free electricity in the United States in 2020.  Recently, Exelon Corporation EXC received regulatory support to continue operating its Byron and Dresden nuclear plants in Illinois, which were scheduled to shut down by end of this year.Utilities like Dominion Energy D and Duke Energy Corporation DUK, among an increasing group of utilities, have already pledged net-zero emission by 2050. Both these companies are focused to add more alternate clean sources of energy to produce electricity and lower emission.Price PerformanceIn the past six months, shares of the company have gained 3.6%, outperforming the industry’s rise of 1.6%. Image Source: Zacks Investment ResearchZacks RankVistra currently carries a Zacks Rank #4 (Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Exelon Corporation (EXC): Free Stock Analysis Report Duke Energy Corporation (DUK): Free Stock Analysis Report Dominion Energy Inc. (D): Free Stock Analysis Report Vistra Corp. (VST): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

RBC Bearings (ROLL) Offers Common & Preferred Stocks to Public (Revised)

RBC Bearings (ROLL) offers common and convertible preferred stocks to the public. It intends on using the proceeds for the DODGE buyout and pay related fees, and satisfy general corporate purposes. RBC Bearings Incorporated ROLL announced the public offerings of its common shares and Series A mandatory convertible preferred stock. It also expects granting options to underwriters with respect to these offerings.The company’s shares gained 0.44% yesterday, ending the trading session at $215.55.Inside the HeadlinesRBC Bearings’ common share offering is for 3 million shares, while the other offering is for $400 million worth of preferred stock. Notably, the preferred stock has a liquidation preference of $100 per share. It is worth noting here the preferred stocks will be converted into the company’s common shares on Oct 15, 2024.The company intends on giving the underwriters an option to buy additional 0.45 million common stocks and Series A mandatory convertible preferred stocks worth $60 million. The option for underwriters is valid for 30 days. The net proceeds from the common stock offering are expected to be $605.6 million or $696.5 million if the underwriters exercise their options. Meanwhile, the preferred stock offering is expected to yield net proceeds of $387.2 million or $445.4 million if the underwriters exercise their options.RBC Bearings anticipates using the net proceeds from the common stock and preferred stock offerings to fund the acquisition of Asea Brown Boveri Ltd’s DODGE mechanical power transmission division. The deal, valued at $2.9 billion, was announced by RBC Bearings in July and is anticipated to be complete in third-quarter fiscal 2022 (ending December 2021).In addition, RBC Bearings plans on using the proceeds for paying fees and expenses related to the DODGE acquisition and satisfy general corporate purposes.It is worth mentioning here that RBC Bearings’ shares outstanding at the end of first-quarter fiscal 2022 (ended Jul 3, 2021) were 25.3 million. We believe that the above-mentioned common stock offering along with preferred stocks, when converted into common stock, will increase the company’s common stock outstanding balance. A rise in shares outstanding will likely have adverse impacts on the company’s earnings per share.Zacks Rank, Price Performance and Estimate TrendWith a market capitalization of $5.5 billion, RBC Bearings currently carries a Zacks Rank #3 (Hold). Strength in industrial markets, healthy backlog and favorable shareholder-friendly policies are beneficial. However, the persistence of weakness in the aerospace markets is concerning.In the past three months, the company’s shares have gained 9.5% against the industry’s decline of 3.4%. Image Source: Zacks Investment Research In the past 60 days, the Zacks Consensus Estimate for its earnings has decreased 3.7% to $1.05 per share for the second quarter of fiscal 2022 (ending September 2021). The consensus estimate for fiscal 2022 (ending March 2022) at $4.49 and for fiscal 2023 (ending March 2023) at $5.14 reflects 0.2% and 0.8% increases from the 60-day-ago figures, respectively.RBC Bearings Incorporated Price and Consensus  RBC Bearings Incorporated price-consensus-chart | RBC Bearings Incorporated QuoteStocks to ConsiderThree better-ranked stocks in the industry are EnPro Industries, Inc. NPO, Kadant Inc. KAI and Nordson Corporation NDSN. All companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.In the past 60 days, earnings estimates for these companies have improved for the current year. Further, positive earnings surprise for the last reported quarter was 25.81% for EnPro Industries, 33.11% for Kadant and 14.15% for Nordson.(We are reissuing this article to correct a mistake. The original article, issued on September 21, 2021, should no longer be relied upon.) More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nordson Corporation (NDSN): Free Stock Analysis Report Kadant Inc (KAI): Free Stock Analysis Report EnPro Industries (NPO): Free Stock Analysis Report RBC Bearings Incorporated (ROLL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

Yum China (YUMC) & Lavazza Plan to Open 1K Lavazza Cafes in China

Yum China (YUMC) and Lavazza Group announces a plan to increase the footprint of Lavazza cafes in China. Yum China Holdings, Inc. YUMC and Lavazza Group, which is an Italian manufacturer of coffee products, recently announced a plan to broaden the footprint of Lavazza cafés in China. In the beginning of 2020, Yum China and Lavazza Group formed a joint venture (JV) to expand the Lavazza café concept in China.Through the JV, the companies plan to open 1,000 Lavazza cafés by 2025. In an effort to drive growth, the companies together will invest $200 million. It is worth mentioning that Yum China has a 65% stake in the JV, while Lavazza owns the remaining 35%.Since the first Lavazza flagship store in Shanghai, which was opened in April 2020, Lavazza has continued to increase its store count to more than 20 stores in China across cities like Shanghai, Hangzhou, Beijing and Guangzhou.Joey Wat, CEO of Yum China said, “The recent progress of Lavazza cafés in China has been encouraging and reaffirms our belief that our partnership is well positioned to capture the significant coffee opportunity in China with accelerated store network development. We are excited about what the future holds for this iconic Italian brand.”The companies plan to expand Lavazza presence in higher tier cities with a variety of store formats. As of Aug 31, 2021, Lavazza had 22 stores, the JV is planning to increase the store count to more than double by the end of 2021.Image Source: Zacks Investment ResearchPrice PerformanceSo far this year, shares of Yum China have declined 4.1% against the Zacks Retail - Restaurants industry’s 14% rise. The company is benefiting from its gradual shift toward digital and content marketing to expand its customer base. Also, continuous menu innovation, strategic investment in unit expansion and strong brand recognition are expected to effectively drive sales in 2021 and beyond.Yum China carries a Zacks Rank #3 (Hold).Other Solid Restaurant BetsSome better-ranked stocks in the same Zacks Retail - Restaurants industry include Jack in the Box Inc. JACK, Chipotle Mexican Grill, Inc. CMG and The Wendy's Company WEN, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Jack in the Box has a trailing four-quarter earnings surprise of 26.4%, on average.Chipotle earnings for 2021 are expected to rise 137.5%.Wendy's earnings for 2021 are anticipated to increase 42.1%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Jack In The Box Inc. (JACK): Free Stock Analysis Report Chipotle Mexican Grill, Inc. (CMG): Free Stock Analysis Report The Wendys Company (WEN): Free Stock Analysis Report Yum China Holdings Inc. (YUMC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

RBC Bearings (ROLL) Prices Stock Offerings, To Offer Notes

RBC Bearings (ROLL) offers common and convertible preferred stocks to the public and intends on offering senior notes privately. Proceeds are to be primarily used for funding the DODGE buyout. RBC Bearings Incorporated ROLL announced the pricing of public offerings of its common shares and 5.00% Series A mandatory convertible preferred stock. Concurrently, the company communicated that its wholly-owned subsidiary, Roller Bearing Company of America, Inc., intends on issuing $500 million of senior notes.Yesterday, RBC Bearings’ shares gained 5.43%, ending the trading session at $199.57.Inside the HeadlinesFor 3 million common share offerings, RBC Bearings priced each share at $185.00. Underwriters have been given the option to purchase additional 0.45 million common stocks. Discount offered to the underwriters totals $27.8 million (at the rate of $9.25 per common stock for 3 million shares) or $31.9 million (at the rate of $9.25 per common stock for 3.45 million shares). The net proceeds from the common stock offering are expected to be $526.4 million (for 3 million share offering) or $605.5 million if the underwriters exercise their options entirely.For a $400-million preferred stock offering, the company priced each stock at $100.00. At this price, its offerings are for 4 million preferred stocks or 4.6 million stocks, including underwriters’ option to buy additional 0.6 million stocks. Notably, each preferred stock has a liquidation preference of $100.The annual dividend rate for the preferred stock is 5%. Payouts will be made quarterly on Jan 15, Apr 15, Jul 15 and Oct 15. The first disbursement is scheduled for Jan 15, 2022, and the last payment is on Oct 15, 2024.Notably, the preferred stocks will be converted into the company’s common shares on Oct 15, 2024. The initial minimum and maximum conversion rates are 0.4413 and 0.5405, respectively, while the initial minimum and maximum conversion prices are $185.00 per share and $226.63 per share, respectively.The underwriters’ discount totals $12 million (at the rate of $3.00 per preferred stock for 4 million shares) or $13.8 million (at the rate of $3.00 per preferred stock for 4.6 million shares). Net proceeds are expected to be 387.2 million (for 4 million shares) or $445.4 million if the underwriters exercise their options entirely.The option for underwriters in both offerings is valid for 30 days. Also, net proceeds are after adjusting discounts for underwriters, commissions, and expenses related to the offerings. The settlement date for both offerings is set at Sep 24, 2021.RBC Bearings anticipates using the net proceeds from the common stock and preferred stock offerings to fund the acquisition of Asea Brown Boveri Ltd’s DODGE mechanical power transmission division. The deal, valued at $2.9 billion, was announced by RBC Bearings in July and is anticipated to be complete in third-quarter fiscal 2022 (ending December 2021). In addition, the company plans on using the proceeds for paying fees and expenses related to the DODGE acquisition and satisfy general corporate purposes.Regarding the senior notes offering, RBC Bearings’ subsidiary proposes to offer senior notes due to mature in 2029. The private offering of notes is subject to the satisfaction of the market and other necessary conditions. The proceeds raised from the offerings will be used for financing the acquisition of Asea Brown Boveri Ltd’s DODGE mechanical power transmission division. Also, buyout-related expenses and other costs will be financed.It is worth mentioning here that RBC Bearings’ shares outstanding at the end of first-quarter fiscal 2022 (ended Jul 3, 2021) were 25.3 million, while its long-term debts are $10.8 million.We believe that the above-mentioned common stock offering along with preferred stocks, when converted into common stock, will increase the company’s common stock outstanding balance. A rise in shares outstanding will likely have adverse impacts on the company’s earnings per share. Also, the issuance of senior notes will inflate the debts.Zacks Rank, Price Performance and Estimate TrendWith a market capitalization of $4.8 billion, RBC Bearings currently carries a Zacks Rank #3 (Hold). Strength in industrial markets, healthy backlog and favorable shareholder-friendly policies are beneficial. However, the persistence of weakness in the aerospace markets is concerning.In the past three months, the company’s shares have decreased 2.3% compared with the industry’s decline of 3.9%. Image Source: Zacks Investment Research In the past 60 days, the Zacks Consensus Estimate for its earnings has decreased 3.7% to $1.05 per share for the second quarter of fiscal 2022 (ending September 2021). The consensus estimate for fiscal 2022 (ending March 2022) at $4.49 and for fiscal 2023 (ending March 2023) at $5.14 reflects 0.2% and 0.8% increases from the 60-day-ago figures, respectively.RBC Bearings Incorporated Price and Consensus  RBC Bearings Incorporated price-consensus-chart | RBC Bearings Incorporated QuoteStocks to ConsiderThree better-ranked stocks in the industry are Kadant Inc. KAI, Nordson Corporation NDSN and EnPro Industries, Inc. NPO. While Kadant and Nordson presently sport a Zacks Rank #1 (Strong Buy), EnPro Industries carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.In the past 60 days, earnings estimates for these companies have improved for the current year. Further, positive earnings surprise for the last reported quarter was 33.11% for Kadant, 14.15% for Nordson and 25.81% for EnPro Industries. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Nordson Corporation (NDSN): Free Stock Analysis Report Kadant Inc (KAI): Free Stock Analysis Report EnPro Industries (NPO): Free Stock Analysis Report RBC Bearings Incorporated (ROLL): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

SmileDirectClub (SDC) to Boost Europe Presence, Enter France

SmileDirectClub (SDC) since its foray into Europe in 2019 has been seeing remarkable market penetration of its oral care products. SmileDirectClub SDC, in its efforts to expand its international footprint, plans to foray into France in the beginning of the fourth quarter of 2021. France will be the seventh European country in which the company will have a presence.SmileDirectClub plans to launch its premium clear aligners, telehealth platform, and whitening system at its first France SmileShop in Paris. This will be followed by the company’s entry in additional locations.More About the NewsCustomers who want to undergo clear aligner treatment using the SmileDirectClub telehealth platform will be able to book a free appointment at a SmileShop to capture a 3D image of their teeth. They can also visit the company’s website to request a dentist-prescribed impression kit.The company noted that the clear aligner treatment with SmileDirectClub is directed and managed remotely using telehealth by an affiliated and locally registered dentist or orthodontist, from initial diagnosis to completion.Strategic SignificanceSo far, SmileDirectClub has seen huge market opportunities for its advanced, easy-to-use, and affordable clear aligners and telehealth platform. The company, since its foray into Europe in 2019, has experienced remarkable market penetration of its brand.As France is Europe’s third-largest market, the company expects to see meaningful consumer demand for its oral care products. According to SmileDirectClub, approximately 80% of French consumers seek to improve the straightness of their teeth. However, the huge cost of orthodontic treatment is a big barrier for them. The company’s affordable clear aligners, which are priced at 60% less than braces, are expected to capture this market well.Global Market Opportunity for Clear AlignersGoing by a Fortune Business Insights Report, the global clear aligners market is projected to grow from $2.85 billion in 2021 to $10.04 billion in 2028 at a CAGR of 19.7%.Recent International Developments by SDCIn terms of the retail partnership, SmileDirectClub’s oral care products are getting rolled out at Walmart and Shoppers Drug Mart locations across Canada. By the end of 2021, the company’s ancillary product portfolio will be available through every retail channel, including drug stores, grocery stores, club stores, mass retailers, and e-commerce. Image Source: Zacks Investment ResearchIn March 2021, SmileDirectClub announced its plan to continue the company’s international expansion with a launch in Mexico. The first two SmileShop locations were opened in Mexico City. This marks the company’s entry in Latin America as it pursues the massive global market opportunity for its innovative, premium, and affordable telehealth solution for orthodontia.Share Price PerformanceOver the past year, shares of SmileDirectClub have underperformed the industry. The stock has declined 39.5% against the industry’s 36.3% rise.Zacks Rank and Key PicksCurrently, SmileDirectClub carries a Zacks Rank #4 (Sell).A few better-ranked stocks from the Medical-Products industry are Envista Holdings Corporation NVST, VAREX IMAGING VREX, and BellRing Brands, Inc. BRBR.Envista Holdings, which carries a Zacks Rank #1 (Strong Buy), has a long-term earnings growth rate of 27.4%. You can see the complete list of today’s Zacks #1 Rank stocks here.VAREX, carrying a Zacks Rank #2 (Buy), has a long-term earnings growth rate of 5%.BellRing Brands, with a Zacks Rank #2, has a long-term earnings growth rate of 29.1%. More Stock News: This Is Bigger than the iPhone! It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 77 billion devices by 2025, creating a $1.3 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 4 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2022.Click here for the 4 trades >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report VAREX IMAGING (VREX): Free Stock Analysis Report SmileDirectClub, Inc. (SDC): Free Stock Analysis Report Envista Holdings Corporation (NVST): Free Stock Analysis Report BellRing Brands, Inc. (BRBR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 23rd, 2021

Existing-Home Sales Retreat in August

Existing-home sales backed up in August, after two consecutive months of increases, according to the National Association of REALTORS® (NAR). Each of the four major U.S. regions experienced declines on both a MoM and YoY basis. Total existing-home sales decreased by 2.0% from July to a seasonally adjusted annual rate of 5.88 million in August. […] The post Existing-Home Sales Retreat in August appeared first on RISMedia. Existing-home sales backed up in August, after two consecutive months of increases, according to the National Association of REALTORS® (NAR). Each of the four major U.S. regions experienced declines on both a MoM and YoY basis. Total existing-home sales decreased by 2.0% from July to a seasonally adjusted annual rate of 5.88 million in August. Year-over-year, sales dropped 1.5% from last year (5.97 million in August 2020). Single-family home sales decreased to a seasonally adjusted annual rate of 5.19 million in August, down 1.9% from 5.29 million in July and down 2.8% from last year. Existing condo and co-op sales recorded at a seasonally adjusted annual rate of 690,000 units in August, down 2.8% from 710,000 in July but up 9.5% from last year. By Region: Midwest Existing-Home Sales: 1.37 million (-2.1% YoY) Median Price: $272,200 (+10.5% YoY) Northeast Existing-Home Sales: 730,000 (-2.7% YoY) Median Price: $407,800 (+16.8% YoY) South Existing-Home Sales: 2.55 million (-0.8% YoY) Median Price: $303,200 (+12.8% YoY) West Existing-Home Sales: 1.23 million (-1.6% YoY) Median Price: $507,900 (+11.4% YoY) What the industry is saying: “Sales slipped a bit in August as prices rose nationwide. Although there was a decline in home purchases, potential buyers are out and about searching, but much more measured about their financial limits, and simply waiting for more inventory. High home prices make for an unbalanced market, but prices would normalize with more supply. Securing a home is still a major challenge for many prospective buyers. A number of potential buyers have merely paused their search, but their desire and need for a home remain.” — Lawrence Yun, Chief Economist, NAR “We will continue working with federal policymakers and stakeholders from across the industry in an effort to increase housing supply and ensure the American Dream of homeownership remains accessible to as many people as possible.” — Charlie Oppler, President, NAR “While housing activity has clearly cooled from its frenzy during the midst of the pandemic, home sales remain well-above the pre-pandemic pace and the median sales price continues to grow, albeit at a slower pace. A still-large number of young households are driving housing market activity, and leveraging the boost in purchasing power provided by low mortgage rates. Despite this, rising home prices mean that today’s buyers are spending larger shares of their paychecks to buy the typical home, and that trend could eventually cause some buyers to put home searches on hold, especially if mortgage rates begin to rise in response to expected tapering of asset purchases by the Fed later this year. “Those who continue their home searches in the cooler months ahead are likely to be pleasantly surprised. Not only do we expect to see the usual seasonal respite from the competitiveness of the spring and summer home-buying season—making early fall the best time to buy a home—the return of sellers to the housing market driven by the improving economy and diminishing health risks could accentuate this trend. “Additionally, recent construction figures show that builders continued to ramp up production in August and their outlook remained high in September, even as supply-chain challenges continue. These modest improvements are welcome, but haven’t changed the big-picture state: there are not enough homes for sale. Despite the recent improvement, single-family construction would still need to double to close the gap with household formation that accumulated over the last decade within the next five to six years.” — Danielle Hale, Chief Economist, realtor.com® “Moving into the fall we continue to expect to see year-over-year declines in home sales related primarily to a return to normal seasonal patterns. This is a result of the base-effect created by the abnormal surge in home sales we saw in late Q3 and Q4 of 2020. The economy has continued to strengthen despite the recent surge in the Delta variant and we see the fundamentals behind housing demand remain strong looking at the rest of 2021 and into 2022. “Home prices remain our primary source of concern as affordability becomes an increasing challenge, particularly for first time homebuyers who have not had the opportunity to benefit from the wealth created from recent surges in home equity. We expect that the Federal Reserve will likely give further indication on timing this week on reductions in Mortgage Backed Securities purchases. “In multiple meetings, the Fed has pointed to trends in home prices as potential justification for reducing asset purchases, implying the upward pressure on mortgage rates would be useful in helping slow the pace of home price appreciation. Overall we think home sales will remain strong going into next year, but we should see inventory levels continue to slowly trend toward more normal levels and home price appreciation begin to slow over time.” — Ruben Gonzalez, Chief Economist, Keller Williams  For more information, please visit www.nar.realtor. The post Existing-Home Sales Retreat in August appeared first on RISMedia......»»

Category: realestateSource: rismediaSep 22nd, 2021

Tractor Supply (TSCO) Expands Portfolio With PORTER-CABLE Deal

Tractor Supply (TSCO) makes ties with the PORTER-CABLE brand to expand power tools and accessories offerings across its stores and online portals. It plans several launches in the year ahead. Tractor Supply Company TSCO has partnered with the PORTER-CABLE brand to provide power tools and accessories across its stores in the United States. PORTER-CABLE, which is an original portable power tool brand, will feature in all Tractor Supply stores. The company also has plans to expand the tools and accessories line with the launch of exclusive cordless product innovations in 2022.The partnership will help PORTER-CABLE to expand its reach through Tractor Supply’s extensive retail footprint in the United States. It is expected to result in greater demand for PORTER’s products, with innovations like PORTER-CABLE 20V MAX cordless systems and accessories on the cards.For Tractor Supply, the addition of the latest line is likely to help in meeting customers’ needs better. The deal will give the company access to nearly 12 million shoppers already owning the PORTER-CABLE 20V battery platform.Tractor Supply plans to launch the PORTER-CABLE products in its stores and online through its Neighbor's Club and "Ultimate Workshop" promotion. This is expected to be completed by fourth-quarter 2021. Coming to the expansion of PORTER-CABLE, the brand is expected to roll out cordless tool and accessory innovations by 2022, featuring exclusively in Tractor Supply’s stores and online portal.Shares of Tractor Supply did not react much to the news. Overall, the Zacks Rank #2 (Buy) company’s shares have risen 15.3% in the past three months against the industry’s decline of 15.8%. Image Source: Zacks Investment Research What’s In Store for Tractor Supply?Tractor Supply is on track to build up on its Out Here lifestyle assortment and convenient shopping format to gain customers and market share. The strategy is essentially based on five key pillars, which include customers, digitization, execution, team members, and total shareholder return. Some of the key initiatives undertaken to support the strategy are boosting space productivity, enhancing omni-channel initiatives, the evolution of Neighbor’s Club loyalty program, and augmenting in-store merchandising execution.As part of the Life Out Here Strategy, the company provided long-term financial growth targets for three to five years, after the normalizing of macro conditions from the impacts of the COVID-19 pandemic. It envisions achieving net sales growth of 6-7%, while comps are expected to grow 4-5%. The operating margin is expected to be 9-9.5% and earnings per share are expected to increase 8-10%.The company launched the Field Activity Support Team, and is implementing various technology and service enhancements across the enterprise. It is also in the initial phase of transforming its side lots and mature stores to improve space productivity, bringing the latest merchandising strategies to life and advancing efforts to remain nationally strong and locally relevant.Tractor Supply is benefiting from the rollout of capabilities like stockyard in-store kiosk and mobile point-of-sale in all its stores as well as enhancing the Tractor Supply credit card offering and investments in its supply chain. Its newly launched mobile app as well as the Neighbor's Club loyalty program have been key growth drivers.Notably, its mobile app recorded more than 1.6 million downloads in second-quarter 2021 and now accounts for more than 10% of its digital sales. The Neighbor's Club added 5 million members year over year, representing nearly 65% of sales. The expansion of its Buy Online Pickup in Store service to include drive-through pickup service is also likely to aid growth in the near term.The company plans 150-200 Side Lot transformations and 150-200 Project Fusion store remodels of existing Tractor Supply stores as part of its Life Out Here Strategy. Tractor Supply currently boasts 160 Project Fusion stores, which have been performing well with positive customer feedback. The company has completed 60 side lot transformations, with more than 150 to be completed by the end of 2021.Better-Ranked Stocks to WatchUlta Beauty Inc. ULTA has a long-term earnings growth rate of 16.5%. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Abercrombie & Fitch Company ANF, with a Zacks Rank #1 at present, has a long-term earnings growth rate of 18%.Tapestry, Inc. TPR, also a Zacks Rank #1 stock, has a long-term earnings growth rate of 11.7%. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Abercrombie & Fitch Company (ANF): Free Stock Analysis Report Tractor Supply Company (TSCO): Free Stock Analysis Report Ulta Beauty Inc. (ULTA): Free Stock Analysis Report Tapestry, Inc. (TPR): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 22nd, 2021

Caesars (CZR) Boosts Partnership With Nobu, Expands Footprint

Caesars (CZR), which is set to strengthen its collaboration with Nobu Hospitality, announces the opening of hotels and restaurants in three new locations across the United States. Caesars Entertainment, Inc. CZR recently announced the expansion of its collaboration with Nobu Hospitality, with two new Nobu Hotels and restaurants at Harrah's New Orleans and Caesars Atlantic City, a Nobu restaurant at Paris Las Vegas and a refresh of the first Nobu Hotel at Caesars Palace, Las Vegas.Nobu hotels feature a mixture of modern luxury with a touch of Japanese tradition in their products and services. Hotels of each location will have a blend of local features, along with Nobu's signature style. A Nobu restaurant and lounge at Paris Las Vegas is expected to open in early 2022 and Nobu Hotel Atlantic City is anticipated to open in the summer of 2022. Furthermore, Nobu Hotel and restaurant at New Orleans  are expected to open in 2024.With respect to the collaboration, Gary Selesner, president of Caesars Development, said, “We couldn't be happier to have the opportunity to raise that bar with Chef Nobu, Robert and Meir. Together, we will create incredible new experiences steeped in Nobu's signature style and sophistication to Las Vegas, Atlantic City and New Orleans.”This association between Caesars and Nobu Hospitality has brought the concept of the world's first celebrity-branded hotel raising the bar of the overall hotel industry.Continuous Partnerships Boosting ExpansionCaesars Entertainment continues to focus on partnerships to drive growth. Earlier, the company expanded its partnership with the Arizona Diamondbacks and Caesars Superdome. It is committed toward expanding its relationships with leagues and professional sports teams.On Aug 12, 2021, the company announced a collaboration with an American football team — Houston Texans — which has made Caesars Entertainment its official casino partner. Fiesta Bowl Organization is the most recent addition to Caesars Entertainment’s list of growing sports relationships. The company emphasizes on sports betting expansion. To this end, the company formed a new Caesars Digital segment comprising of sports betting, iGaming and poker. It also integrated its digital offerings with Caesars Rewards, at both online and physical casinos. As of Jun 30, 2021, the company operates sports betting in 17 states (plus Washington, D.C.), out of which 13 offer mobile sports betting.Currently, Caesars has a Zacks Rank #3 (Hold). So far this year, shares of Caesars have gained 41.4% compared with the Zacks Leisure and Recreation Services industry’s 10.2% growth. Image Source: Zacks Investment Research3 Leisure Stocks Worth BuyingA few better-ranked stocks in the same industry include Bluegreen Vacations Holding Corporation BVH, SeaWorld Entertainment, Inc. SEAS and RCI Hospitality Holdings, Inc. RICK. Bluegreen Vacations and SeaWorld Entertainment sport a Zacks Rank #1 (Strong Buy), while RCI Hospitality has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Bluegreen Vacations and SeaWorld Entertainment’s earnings for2021 are expected to surge 172% and 176.4%, respectively.RCI Hospitality’s earnings for fiscal 2021 are expected to rise 523.5%. Infrastructure Stock Boom to Sweep America A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made. The only question is “Will you get into the right stocks early when their growth potential is greatest?” Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.Download FREE: How to Profit from Trillions on Spending for Infrastructure >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Caesars Entertainment, Inc. (CZR): Free Stock Analysis Report RCI Hospitality Holdings, Inc. (RICK): Free Stock Analysis Report SeaWorld Entertainment, Inc. (SEAS): Free Stock Analysis Report Bluegreen Vacations Holding Corporation (BVH): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 22nd, 2021

Futures Bounce On Evergrande Reprieve With Fed Looming

Futures Bounce On Evergrande Reprieve With Fed Looming Despite today's looming hawkish FOMC meeting in which Powell is widely expected to unveil that tapering is set to begin as soon as November and where the Fed's dot plot may signal one rate hike in 2022, futures climbed as investor concerns over China's Evergrande eased after the property developer negotiated a domestic bond payment deal. Commodities rallied while the dollar was steady. Contracts on the S&P 500 and Nasdaq 100 flipped from losses to gains as China’s central bank boosted liquidity when it injected a gross 120BN in yuan, the most since January... ... and investors mulled a vaguely-worded statement from the troubled developer about an interest payment.  S&P 500 E-minis were up 23.0 points, or 0.53%, at 7:30 a.m. ET. Dow E-minis were up 199 points, or 0.60%, and Nasdaq 100 E-minis were up 44.00 points, or 0.29%. Among individual stocks, Fedex fell 5.8% after the delivery company cut its profit outlook on higher costs and stalled growth in shipments. Morgan Stanley says it sees the company’s 1Q issues getting “tougher from here.” Commodity-linked oil and metal stocks led gains in premarket trade, while a slight rise in Treasury yields supported major banks. However, most sectors were nursing steep losses in recent sessions. Here are some of the biggest U.S. movers: Adobe (ADBE US) down 3.1% after 3Q update disappointed the high expectations of investors, though the broader picture still looks solid, Morgan Stanley said in a note Freeport McMoRan (FCX US), Cleveland- Cliffs (CLF US), Alcoa (AA US) and U.S. Steel (X US) up 2%-3% premarket, following the path of global peers as iron ore prices in China rallied Aethlon Medical (AEMD US) and Exela Technologies (XELAU US) advance along with other retail traders’ favorites in the U.S. premarket session. Aethlon jumps 21%; Exela up 8.3% Other so-called meme stocks also rise: ContextLogic +1%; Clover Health +0.9%; Naked Brand +0.9%; AMC +0.5% ReWalk Robotics slumps 18% in U.S. premarket trading, a day after nearly doubling in value Stitch Fix (SFIX US) rises 15.7% in light volume after the personal styling company’s 4Q profit and sales blew past analysts’ expectations Hyatt Hotels (H US) seen opening lower after the company launches a seven-million-share stock offering Summit Therapeutics (SMMT US) shares fell as much as 17% in Tuesday extended trading after it said the FDA doesn’t agree with the change to the primary endpoint that has been implemented in the ongoing Phase III Ri-CoDIFy studies when combining the studies Marin Software (MRIN US) surged more than 75% Tuesday postmarket after signing a new revenue-sharing agreement with Google to develop its enterprise technology platforms and software products The S&P 500 had fallen for 10 of the past 12 sessions since hitting a record high, as fears of an Evergrande default exacerbated seasonally weak trends and saw investors pull out of stocks trading at lofty valuations. The Nasdaq fell the least among its peers in recent sessions, as investors pivoted back into big technology names that had proven resilient through the pandemic. Focus now turns to the Fed's decision, due at 2 p.m. ET where officials are expected to signal a start to scaling down monthly bond purchases (see our preview here).  The Fed meeting comes after a period of market volatility stoked by Evergrande’s woes. China’s wider property-sector curbs are also feeding into concerns about a slowdown in the economic recovery from the pandemic. “Chair Jerome Powell could hint at the tapering approaching shortly,” said Sébastien Barbé, a strategist at Credit Agricole CIB. “However, given the current uncertainty factors (China property market, Covid, pace of global slowdown), the Fed should remain cautious when it comes to withdrawing liquidity support.” Meanwhile, confirming what Ray Dalio said that the taper will just bring more QE, Governing Council member Madis Muller said the  European Central Bank may boost its regular asset purchases once the pandemic-era emergency stimulus comes to an end. “Dovish signals could unwind some of the greenback’s gains while offering relief to stock markets,” Han Tan, chief market analyst at Exinity Group, wrote in emailed comments. A “hawkish shift would jolt markets, potentially pushing Treasury yields and the dollar past the upper bound of recent ranges, while gold and equities would sell off hunting down the next levels of support.” China avoided a major selloff as trading resumed following a holiday, after the country’s central bank boosted its injection of short-term cash into the financial system. MSCI’s Asia-Pacific index declined for a third day, dragged lower by Japan. Stocks were also higher in Europe. Basic resources - which bounced from a seven month low - and energy were among the leading gainers in the Stoxx Europe 600 index as commodity prices steadied after Beijing moved to contain fears of a spiraling debt crisis. Entain Plc rose more than 7%, extending Tuesday’s gain as it confirmed it received a takeover proposal from DraftKings Inc. Peer Flutter Entertainment Plc climbed after settling a legal dispute.  Here are some of the biggest European movers today: Entain shares jump as much as 11% after DraftKings Inc. offered to acquire the U.K. gambling company for about $22.4 billion. Vivendi rises as much as 3.1% in Paris, after Tuesday’s spinoff of Universal Music Group. Legrand climbs as much as 2.1% after Exane BNP Paribas upgrades to outperform and raises PT to a Street-high of EU135. Orpea shares falls as much as 2.9%, after delivering 1H results that Jefferies (buy) says were a “touch” below consensus. Bechtle slides as much as 5.1% after Metzler downgrades to hold from buy, saying persistent supply chain problems seem to be weighing on growth. Sopra Steria drops as much as 4.1% after Stifel initiates coverage with a sell, citing caution on company’s M&A strategy Despite the Evergrande announcement, Asian stocks headed for their longest losing streak in more than a month amid continued China-related concerns, with traders also eying policy decisions from major central banks. The MSCI Asia Pacific Index dropped as much as 0.7% in its third day of declines, with TSMC and Keyence the biggest drags. China’s CSI 300 tumbled as much as 1.9% as the local market reopened following a two-day holiday. However, the gauge came off lows after an Evergrande unit said it will make a bond interest payment and as China’s central bank boosted liquidity.  Taiwan’s equity benchmark led losses in Asia on Wednesday, dragged by TSMC after a two-day holiday, while markets in Hong Kong and South Korea were closed. Key stock gauges in Australia, Indonesia and Vietnam rose “A liquidity injection from the People’s Bank of China accompanied the Evergrande announcement, which only served to bolster sentiment further,” according to DailyFX’s Thomas Westwater and Daniel Dubrovsky. “For now, it appears that market-wide contagion risk linked to a potential Evergrande collapse is off the table.” Japanese equities fell for a second day amid global concern over China’s real-estate sector, as the Bank of Japan held its key stimulus tools in place while flagging pressures on the economy. Electronics makers were the biggest drag on the Topix, which declined 1%. Daikin and Fanuc were the largest contributors to a 0.7% loss in the Nikkei 225. The BOJ had been expected to maintain its policy levers ahead of next week’s key ruling party election. Traders are keenly awaiting the Federal Reserve’s decision due later for clues on the U.S. central banks plan for tapering stimulus. “Markets for some time have been convinced that the BOJ has reached the end of the line on normalization and will remain in a holding pattern on policy until at least April 2023 when Governor Kuroda is scheduled to leave,” UOB economist Alvin Liew wrote in a note. “Attention for the BOJ will now likely shift to dealing with the long-term climate change issues.” In the despotic lockdown regime that is Australia, the S&P/ASX 200 index rose 0.3% to close at 7,296.90, reversing an early decline in a rally led by mining and energy stocks. Banks closed lower for the fourth day in a row. Champion Iron was among the top performers after it was upgraded at Citi. IAG was among the worst performers after an earthquake caused damage to buildings in Melbourne. In New Zealand, the S&P/NZX 50 index rose 0.3% to 13,215.80 In FX, commodity currencies rallied as concerns about China Evergrande Group’s debt troubles eased as China’s central bank boosted liquidity and investors reviewed a statement from the troubled developer about an interest payment. Overnight implied volatility on the pound climbed to the highest since March ahead of Bank of England’s meeting on Thursday. The British pound weakened after Business Secretary Kwasi Kwarteng warnedthat people should prepare for longer-term high energy prices amid a natural-gas shortage that sent power costs soaring. Several U.K. power firms have stopped taking in new clients as small energy suppliers struggle to meet their previous commitments to sell supplies at lower prices. Overnight volatility in the euro rises above 10% for the first time since July ahead of the Federal Reserve’s monetary policy decision announcement. The Aussie jumped as much as 0.5% as iron-ore prices rebounded. Spot surged through option-related selling at 0.7240 before topping out near 0.7265 strikes expiring Wednesday, according to Asia- based FX traders.  Elsewhere, the yen weakened and commodity-linked currencies such as the Australian dollar pushed higher. In rates, the dollar weakened against most of its Group-of-10 peers. Treasury futures were under modest pressure in early U.S. trading, leaving yields cheaper by ~1.5bp from belly to long-end of the curve. The 10-year yield was at ~1.336% steepening the 2s10s curve by ~1bp as the front-end was little changed. Improved risk appetite weighed; with stock futures have recovering much of Tuesday’s losses as Evergrande concerns subside. Focal point for Wednesday’s session is FOMC rate decision at 2pm ET.   FOMC is expected to suggest it will start scaling back asset purchases later this year, while its quarterly summary of economic projections reveals policy makers’ expectations for the fed funds target in coming years in the dot-plot update; eurodollar positions have emerged recently that anticipate a hawkish shift Bitcoin dropped briefly below $40,000 for the first time since August amid rising criticism from regulators, before rallying as the mood in global markets improved. In commodities, Iron ore halted its collapse and metals steadied. Oil advanced for a second day. Bitcoin slid below $40,000 for the first time since early August before rebounding back above $42,000.   To the day ahead now, and the main highlight will be the aforementioned Federal Reserve decision and Chair Powell’s subsequent press conference. Otherwise on the data side, we’ll get US existing home sales for August, and the European Commission’s advance consumer confidence reading for the Euro Area in September. Market Snapshot S&P 500 futures up 0.4% to 4,362.25 STOXX Europe 600 up 0.5% to 461.19 MXAP down 0.7% to 199.29 MXAPJ down 0.4% to 638.39 Nikkei down 0.7% to 29,639.40 Topix down 1.0% to 2,043.55 Hang Seng Index up 0.5% to 24,221.54 Shanghai Composite up 0.4% to 3,628.49 Sensex little changed at 59,046.84 Australia S&P/ASX 200 up 0.3% to 7,296.94 Kospi up 0.3% to 3,140.51 Brent Futures up 1.5% to $75.47/bbl Gold spot up 0.0% to $1,775.15 U.S. Dollar Index little changed at 93.26 German 10Y yield rose 0.6 bps to -0.319% Euro little changed at $1.1725 Top Overnight News from Bloomberg What would it take to knock the U.S. recovery off course and send Federal Reserve policy makers back to the drawing board? Not much — and there are plenty of candidates to deliver the blow The European Central Bank will discuss boosting its regular asset purchases once the pandemic-era emergency stimulus comes to an end, but any such increase is uncertain, Governing Council member Madis Muller said Investors seeking hints about how Beijing plans to deal with China Evergrande Group’s debt crisis are training their cross hairs on the central bank’s liquidity management A quick look at global markets courtesy of Newsquawk Asian equity markets traded mixed as caution lingered ahead of upcoming risk events including the FOMC, with participants also digesting the latest Evergrande developments and China’s return to the market from the Mid-Autumn Festival. ASX 200 (+0.3%) was positive with the index led higher by the energy sector after a rebound in oil prices and as tech also outperformed, but with gains capped by weakness in the largest-weighted financials sector including Westpac which was forced to scrap the sale of its Pacific businesses after failing to secure regulatory approval. Nikkei 225 (-0.7%) was subdued amid the lack of fireworks from the BoJ announcement to keep policy settings unchanged and ahead of the upcoming holiday closure with the index only briefly supported by favourable currency outflows. Shanghai Comp. (+0.4%) was initially pressured on return from the long-weekend and with Hong Kong markets closed, but pared losses with risk appetite supported by news that Evergrande’s main unit Hengda Real Estate will make coupon payments due tomorrow, although other sources noted this is referring to the onshore bond payments valued around USD 36mln and that there was no mention of the offshore bond payments valued at USD 83.5mln which are also due tomorrow. Meanwhile, the PBoC facilitated liquidity through a CNY 120bln injection and provided no surprises in keeping its 1-year and 5-year Loan Prime Rates unchanged for the 17th consecutive month at 3.85% and 4.65%, respectively. Finally, 10yr JGBs were flat amid the absence of any major surprises from the BoJ policy announcement and following the choppy trade in T-notes which were briefly pressured in a knee-jerk reaction to the news that Evergrande’s unit will satisfy its coupon obligations tomorrow, but then faded most of the losses as cautiousness prevailed. Top Asian News Gold Steady as Traders Await Outcome of Fed Policy Meeting Evergrande Filing on Yuan Bond Interest Leaves Analysts Guessing Singapore Category E COE Price Rises to Highest Since April 2014 Asian Stocks Fall for Third Day as Focus Turns to Central Banks European equities (Stoxx 600 +0.5%) trade on a firmer footing in the wake of an encouraging APAC handover. Focus overnight was on the return of Chinese participants from the Mid-Autumn Festival and news that Evergrande’s main unit, Hengda Real Estate will make coupon payments due tomorrow; however, we await indication as to whether they will meet Thursday’s offshore payment deadline as well. Furthermore, the PBoC facilitated liquidity through a CNY 120bln injection whilst keeping its 1-year and 5-year Loan Prime Rates unchanged (as expected). Note, despite gaining yesterday and today, thus far, the Stoxx 600 is still lower to the tune of 0.7% on the week. Stateside, futures are also trading on a firmer footing ahead of today’s FOMC policy announcement, at which, market participants will be eyeing any clues for when the taper will begin and digesting the latest dot plot forecasts. Furthermore, the US House voted to pass the bill to fund the government through to December 3rd and suspend the debt limit to end-2022, although this will likely be blocked by Senate Republicans. Back to Europe, sectors are mostly firmer with outperformance in Basic Resources and Oil & Gas amid upside in the metals and energy complex. Elsewhere, Travel & Leisure is faring well amid further upside in Entain (+6.1%) with the Co. noting it rejected an earlier approach from DraftKings at GBP 25/shr with the new offer standing at GBP 28/shr. Additionally for the sector, Flutter Entertainment (+4.1%) are trading higher after settling the legal dispute between the Co. and Commonwealth of Kentucky. Elsewhere, in terms of deal flow, Iliad announced that it is to acquire UPC Poland for around USD 1.8bln. Top European News Energy Cost Spike Gets on EU Ministers’ Green Deal Agenda Travel Startup HomeToGo Gains in Frankfurt Debut After SPAC Deal London Stock Exchange to Shut Down CurveGlobal Exchange EU Banks Expected to Add Capital for Climate Risk, EBA Says In FX, trade remains volatile as this week’s deluge of global Central Bank policy meetings continues to unfold amidst fluctuations in broad risk sentiment from relatively pronounced aversion at various stages to a measured and cautious pick-up in appetite more recently. Hence, the tide is currently turning in favour of activity, cyclical and commodity currencies, albeit tentatively in the run up to the Fed, with the Kiwi and Aussie trying to regroup on the 0.7000 handle and 0.7350 axis against their US counterpart, and the latter also striving to shrug off negative domestic impulses like a further decline below zero in Westpac’s leading index and an earthquake near Melbourne. Next up for Nzd/Usd and Aud/Usd, beyond the FOMC, trade data and preliminary PMIs respectively. DXY/CHF/EUR/CAD - Notwithstanding the overall improvement in market tone noted above, or another major change in mood and direction, the Dollar index appears to have found a base just ahead of 93.000 and ceiling a similar distance away from 93.500, as it meanders inside those extremes awaiting US existing home sales that are scheduled for release before the main Fed events (policy statement, SEP and post-meeting press conference from chair Powell). Indeed, the Franc, Euro and Loonie have all recoiled into tighter bands vs the Greenback, between 0.9250-26, 1.1739-17 and 1.2831-1.2770, but with the former still retaining an underlying bid more evident in the Eur/Chf cross that is consolidating under 1.0850 and will undoubtedly be acknowledged by the SNB tomorrow. Meanwhile, Eur/Usd has hardly reacted to latest ECB commentary from Muller underpinning that the APP is likely to be boosted once the PEPP envelope is closed, though Usd/Cad is eyeing a firm rebound in oil prices in conjunction with hefty option expiry interest at the 1.2750 strike (1.8 bn) that may prevent the headline pair from revisiting w-t-d lows not far beneath the half round number. GBP/JPY - The major laggards, as Sterling slips slightly further beneath 1.3650 against the Buck to a fresh weekly low and Eur/Gbp rebounds from circa 0.8574 to top 0.8600 on FOMC day and T-1 to super BoE Thursday. Elsewhere, the Yen has lost momentum after peaking around 109.12 and still not garnering sufficient impetus to test 109.00 via an unchanged BoJ in terms of all policy settings and guidance, as Governor Kuroda trotted out the no hesitation to loosen the reins if required line for the umpteenth time. However, Usd/Jpy is holding around 109.61 and some distance from 1.1 bn option expiries rolling off between 109.85-110.00 at the NY cut. SCANDI/EM - Brent’s revival to Usd 75.50+/brl from sub-Usd 73.50 only yesterday has given the Nok another fillip pending confirmation of a Norges Bank hike tomorrow, while the Zar has regained some poise with the aid of firmer than forecast SA headline and core CPI alongside a degree of retracement following Wednesday’s breakdown of talks on a pay deal for engineering workers that prompted the union to call a strike from early October. Similarly, the Cnh and Cny by default have regrouped amidst reports that the CCP is finalising details to restructure Evergrande into 3 separate entities under a plan that will see the Chinese Government take control. In commodities, WTI and Brent are firmer this morning though once again fresh newsflow for the complex has been relatively slim and largely consisting of gas-related commentary; as such, the benchmarks are taking their cue from the broader risk tone (see equity section). The improvement in sentiment today has brought WTI and Brent back in proximity to being unchanged on the week so far as a whole; however, the complex will be dictated directly by the EIA weekly inventory first and then indirectly, but perhaps more pertinently, by today’s FOMC. On the weekly inventories, last nights private release was a larger than expected draw for the headline and distillate components, though the Cushing draw was beneath expectations; for today, consensus is a headline draw pf 2.44mln. Moving to metals where the return of China has seen a resurgence for base metals with LME copper posting upside of nearly 3.0%, for instance. Albeit there is no fresh newsflow for the complex as such, so it remains to be seen how lasting this resurgence will be. Finally, spot gold and silver are firmer but with the magnitude once again favouring silver over the yellow metal. US Event Calendar 10am: Aug. Existing Home Sales MoM, est. -1.7%, prior 2.0% 2pm: Sept. FOMC Rate Decision (Lower Boun, est. 0%, prior 0% DB's Jim Reid concludes the overnight wrap All eyes firmly on China this morning as it reopens following a 2-day holiday. As expected the indices there have opened lower but the scale of the declines are being softened by the PBoC increasing its short term cash injections into the economy. They’ve added a net CNY 90bn into the system. On Evergrande, we’ve also seen some positive headlines as the property developers’ main unit Hengda Real Estate Group has said that it will make coupon payment for an onshore bond tomorrow. However, the exchange filing said that the interest payment “has been resolved via negotiations with bondholders off the clearing house”. This is all a bit vague and doesn’t mention the dollar bond at this stage. Meanwhile, Bloomberg has reported that Chinese authorities have begun to lay the groundwork for a potential restructuring that could be one of the country’s biggest, assembling accounting and legal experts to examine the finances of the group. All this follows news from Bloomberg yesterday that Evergrande missed interest payments that had been due on Monday to at least two banks. In terms of markets the CSI (-1.11%), Shanghai Comp (-0.29%) and Shenzhen Comp (-0.53%) are all lower but have pared back deeper losses from the open. We did a flash poll in the CoTD yesterday (link here) and after over 700 responses in a couple of hours we found only 8% who we thought Evergrande would still be impacting financial markets significantly in a month’s time. 24% thought it would be slightly impacting. The other 68% thought limited or no impact. So the world is relatively relaxed about contagion risk for now. The bigger risk might be the knock on impact of weaker Chinese growth. So that’s one to watch even if you’re sanguine on the systemic threat. Craig Nicol in my credit team did a good note yesterday (link here) looking at the contagion risk to the broader HY market. I thought he summed it up nicely as to why we all need to care one way or another in saying that “Evergrande is the largest corporate, in the largest sector, of the second largest economy in the world”. For context AT&T is the largest corporate borrower in the US market and VW the largest in Europe. Turning back to other Asian markets now and the Nikkei (-0.65%) is down but the Hang Seng (+0.51%) and Asx (+0.58%) are up. South Korean markets continue to remain closed for a holiday. Elsewhere, yields on 10y USTs are trading flattish while futures on the S&P 500 are up +0.10% and those on the Stoxx 50 are up +0.21%. Crude oil prices are also up c.+1% this morning. In other news, the Bank of Japan policy announcement overnight was a non-event as the central bank maintained its yield curve target while keeping the policy rate and asset purchases plan unchanged. The central bank also unveiled more details of its green lending program and said that it would immediately start accepting applications and would begin making the loans in December. The relatively calm Asian session follows a stabilisation in markets yesterday following their rout on Monday as investors looked forward to the outcome of the Fed’s meeting later today. That said, it was hardly a resounding performance, with the S&P 500 unable to hold on to its intraday gains and ending just worse than unchanged after the -1.70% decline the previous day as investors remained vigilant as to the array of risks that continue to pile up on the horizon. One of these is in US politics and legislators seem no closer to resolving the various issues surrounding a potential government shutdown at the end of the month, along with a potential debt ceiling crisis in October, which is another flashing alert on the dashboard for investors that’s further contributing to weaker sentiment right now. Looking ahead now, today’s main highlight will be the latest Federal Reserve decision along with Chair Powell’s subsequent press conference, with the policy decision out at 19:00 London time. Markets have been on edge for any clues about when the Fed might begin to taper asset purchases, but concern about tapering actually being announced at this meeting has dissipated over recent weeks, particularly after the most recent nonfarm payrolls in August came in at just +235k, and the monthly CPI print also came in beneath consensus expectations for the first time since November. In terms of what to expect, our US economists write in their preview (link here) that they see the statement adopting Chair Powell’s language that a reduction in the pace of asset purchases is appropriate “this year”, so long as the economy remains on track. They see Powell maintaining optionality about the exact timing of that announcement, but they think that the message will effectively be that the bar to pushing the announcement beyond November is relatively high in the absence of any material downside surprises. This meeting also sees the release of the FOMC’s latest economic projections and the dot plot, where they expect there’ll be an upward drift in the dots that raises the number of rate hikes in 2023 to 3, followed by another 3 increases in 2024. Back to yesterday, and as mentioned US equity markets fell for a second straight day after being unable to hold on to earlier gains, with the S&P 500 slightly lower (-0.08%). High-growth industries outperformed with biotech (+0.38%) and semiconductors (+0.18%) leading the NASDAQ (+0.22%) slightly higher, however the Dow Jones (-0.15%) also struggled. Europe saw a much stronger performance though as much of the US decline came after Europe had closed. The STOXX 600 gained +1.00% to erase most of Monday’s losses, with almost every sector in the index ending the day in positive territory. With risk sentiment improving for much of the day yesterday, US Treasuries sold off slightly and by the close of trade yields on 10yr Treasuries were up +1.2bps to 1.3226%, thanks to a +1.8bps increase in real yields. However, sovereign bonds in Europe told a different story as yields on 10yr bunds (-0.3bps), OATs (-0.3bps) and BTPs (-1.9bps) moved lower. Other safe havens including gold (+0.59%) and silver (+1.02%) also benefited, but this wasn’t reflected across commodities more broadly, with Bloomberg’s Commodity Spot Index (-0.30%) losing ground for a 4th consecutive session. Democratic Party leaders plan to vote on the Senate-approved $500bn bipartisan infrastructure bill next Monday, even with no resolution to the $3.5tr budget reconciliation measure that encompasses the remainder of the Biden Administration’s economic agenda. Democrats continue to work on the reconciliation measure but have turned their attention to the debt ceiling and government funding bills.Congress has fewer than two weeks before the current budget expires – on Oct 1 – to fund the government and raise the debt ceiling. Republicans yesterday noted that the Democrats could raise the ceiling on their own through the reconciliation process, with many saying that they would not be offering their support to any funding bill. Democrats continue to push for a bipartisan bill to raise the debt ceiling, pointing to their votes during the Trump administration. If Democrats are forced to tie the debt ceiling and funding bills to budget reconciliation, it could limit how much of the $3.5 trillion bill survives the last minute negotiations between progressives and moderates. More to come over the next 10 days. Staying on the US, there was an important announcement in President Biden’s speech at the UN General Assembly, as he said that he would work with Congress to double US funding to poorer nations to deal with climate change. That comes as UK Prime Minister Johnson (with the UK hosting the COP26 summit in less than 6 weeks’ time) has been lobbying other world leaders to find the $100bn per year that developed economies pledged by 2020 to support developing countries as they reduce their emissions and deal with climate change. In Germany, there are just 4 days to go now until the federal election, and a Forsa poll out yesterday showed a slight narrowing in the race, with the centre-left SPD remaining on 25%, but the CDU/CSU gained a point on last week to 22%, which puts them within the +/- 2.5 point margin of error. That narrowing has been seen in Politico’s Poll of Polls as well, with the race having tightened from a 5-point SPD lead over the CDU/CSU last week to a 3-point one now. Turning to the pandemic, Johnson & Johnson reported that their booster shot given 8 weeks after the first offered 100% protection against severe disease, 94% protection against symptomatic Covid in the US, and 75% against symptomatic Covid globally. Speaking of boosters, Bloomberg reported that the FDA was expected to decide as soon as today on a recommendation for Pfizer’s booster vaccine. That follows an FDA advisory panel rejecting a booster for all adults last Friday, restricting the recommendation to those over-65 and other high-risk categories. Staying with the US and vaccines, President Biden announced that the US was ordering 500mn doses of the Pfizer vaccine to be exported to the rest of the world. On the data front, there were some strong US housing releases for August, with housing starts up by an annualised 1.615m (vs. 1.55m expected), and building permits up by 1.728m (vs. 1.6m expected). Separately, the OECD released their Interim Economic Outlook, which saw them upgrade their inflation expectations for the G20 this year to +3.7% (up +0.2ppts from May) and for 2022 to +3.9% (up +0.5ppts from May). Their global growth forecast saw little change at +5.7% in 2021 (down a tenth) and +4.5% for 2022 (up a tenth). To the day ahead now, and the main highlight will be the aforementioned Federal Reserve decision and Chair Powell’s subsequent press conference. Otherwise on the data side, we’ll get US existing home sales for August, and the European Commission’s advance consumer confidence reading for the Euro Area in September. Tyler Durden Wed, 09/22/2021 - 08:05.....»»

Category: blogSource: zerohedgeSep 22nd, 2021

Foot Locker (FL) Closes WSS Buyout, Expansion Plan on Track

Foot Locker (FL) is committed to expanding its portfolio via smart buyouts. It completed the buyout of the U.S.-based footwear and apparel retailer Eurostar, Inc. (WSS). Foot Locker, Inc. FL steadily focuses on improving its performance through operational and financial initiatives. Talking of its operational strategy, this New York-based athletic retailer is continuously making prudent investments and undertaking strategic buyouts to attain sustainable growth. In early August, Foot Locker had entered into agreements to acquire Eurostar, Inc. (WSS) for $750 million and Text Trading Company, K.K. (atmos) for $360 million.On Sep 20, it concluded the buyout of WSS. This U.S.-based athletic footwear and apparel retailer mainly operates on the West Coast.In relation to the buyout, Foot Locker announced the appointment of Anthony Aversa as the chief operating officer of WSS, which is effective immediately. He will supervise the brand's market planning, real estate and customer experience activities, and report directly to Rick Mina, the senior vice president & general manager of WSS.More on the WSS BuyoutWSS is a complementary addition to Foot Locker’s portfolio and boasts an impressive customer base rooted in the Hispanic community. Since its inception 37 years back, WSS has successfully developed a high-growth business by pioneering the neighborhood-based store model and focusing on a full-family offering. Hence, this brand enhances the company’s product mix and looks forward to reinforce the buyer’s foothold with a complete off-mall store fleet across major markets. This buyout will help the company expand into new markets and customer segments apart from enhancing its relationships with vendor partners.Foot Locker is likely to gain from WSS' assortment of classic styles, a unique market position, robust customer base and a real-estate portfolio. In fiscal 2020, WSS delivered revenues of about $425 million, reflecting a three-year CAGR of 15%.WSS will maintain its own name post acquisition, thus operating as a new brand across the company's portfolio. Management had earlier stated that both the WSS and atmos transactions will drive the company’s earnings per share in fiscal 2021. It had also projected these deals to be accretive to earnings, which on an annualized basis, are estimated to be 44-48 cents in fiscal 2022. Foot Locker anticipates WSS delivering annual sales growth in low-double digits and EBITDA margins in low-double-to-mid-teen digits in the coming five years.Wrapping UpFoot Locker is consistently gaining from healthy demand from customers as outdoor activities are picking up the pace amid relaxation of the pandemic norms. The company continues to invest in digital platforms, improve supply-chain efficiencies and effectively manage inventory. In addition, management’s commitment to develop power stores is encouraging. Foot Locker’s strategic deals including partnership with NIKE NKE to enhance its assortment and drive growth will keep yielding positive results. The company is progressing well with its FLX membership program as well.Image Source: Zacks Investment ResearchSo far in the year, shares of this currently Zacks Rank #1 (Strong Buy) stock have increased 23.6%, outperforming the industry’s 3.8% growth. You can see the complete list of today’s Zacks #1 Rank stocks here.More Key Picks in RetailCapri Holdings CPRI has a long-term earnings growth rate of 27.2% and a Zacks Rank #1, currently.Abercrombie ANF has a Zacks Rank of 1 and a long-term earnings growth rate of 18% at present. 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 NIKE, Inc. (NKE): Free Stock Analysis Report Abercrombie & Fitch Company (ANF): Free Stock Analysis Report Foot Locker, Inc. (FL): Free Stock Analysis Report Capri Holdings Limited (CPRI): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

RBC Bearings (ROLL) Offers Common & Preferred Stocks to Public

RBC Bearings (ROLL) offers common and convertible preferred stocks to the public. It intends on using the proceeds for the DODGE buyout and pay related fees, and satisfy general corporate purposes. RBC Bearings Incorporated RBC announced the public offerings of its common shares and Series A mandatory convertible preferred stock. It also expects granting options to underwriters with respect to these offerings.The company’s shares gained 0.44% yesterday, ending the trading session at $215.55.Inside the HeadlinesRBC Bearings’ common share offering is for 3 million shares, while the other offering is for $400 million worth of preferred stock. Notably, the preferred stock has a liquidation preference of $100 per share. It is worth noting here the preferred stocks will be converted into the company’s common shares on Oct 15, 2024.The company intends on giving the underwriters an option to buy additional 0.45 million common stocks and Series A mandatory convertible preferred stocks worth $60 million. The option for underwriters is valid for 30 days. The net proceeds from the common stock offering are expected to be $605.6 million or $696.5 million if the underwriters exercise their options. Meanwhile, the preferred stock offering is expected to yield net proceeds of $387.2 million or $445.4 million if the underwriters exercise their options.RBC Bearings anticipates using the net proceeds from the common stock and preferred stock offerings to fund the acquisition of Asea Brown Boveri Ltd’s DODGE mechanical power transmission division. The deal, valued at $2.9 billion, was announced by RBC Bearings in July and is anticipated to be complete in third-quarter fiscal 2022 (ending December 2021).In addition, RBC Bearings plans on using the proceeds for paying fees and expenses related to the DODGE acquisition and satisfy general corporate purposes.It is worth mentioning here that RBC Bearings’ shares outstanding at the end of first-quarter fiscal 2022 (ended Jul 3, 2021) were 25.3 million. We believe that the above-mentioned common stock offering along with preferred stocks, when converted into common stock, will increase the company’s common stock outstanding balance. A rise in shares outstanding will likely have adverse impacts on the company’s earnings per share.Zacks Rank, Price Performance and Estimate TrendWith a market capitalization of $5.5 billion, RBC Bearings currently carries a Zacks Rank #3 (Hold). Strength in industrial markets, healthy backlog and favorable shareholder-friendly policies are beneficial. However, the persistence of weakness in the aerospace markets is concerning.In the past three months, the company’s shares have gained 9.5% against the industry’s decline of 3.4%. Image Source: Zacks Investment Research In the past 60 days, the Zacks Consensus Estimate for its earnings has decreased 3.7% to $1.05 per share for the second quarter of fiscal 2022 (ending September 2021). The consensus estimate for fiscal 2022 (ending March 2022) at $4.49 and for fiscal 2023 (ending March 2023) at $5.14 reflects 0.2% and 0.8% increases from the 60-day-ago figures, respectively.RBC Bearings Incorporated Price and Consensus  RBC Bearings Incorporated price-consensus-chart | RBC Bearings Incorporated QuoteStocks to ConsiderThree better-ranked stocks in the industry are EnPro Industries, Inc. NPO, Kadant Inc. KAI and Nordson Corporation NDSN. All companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.In the past 60 days, earnings estimates for these companies have improved for the current year. Further, positive earnings surprise for the last reported quarter was 25.81% for EnPro Industries, 33.11% for Kadant and 14.15% for Nordson. 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 Regal Beloit Corporation (RBC): Free Stock Analysis Report Nordson Corporation (NDSN): Free Stock Analysis Report Kadant Inc (KAI): Free Stock Analysis Report EnPro Industries (NPO): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021

Rio Tinto (RIO) to Triple Solar Capacity at Weipa Mine

Rio Tinto (RIO) is working toward tripling the Weipa solar capacity and adding battery storage to help power operations. Rio Tinto Plc RIO recently announced that it has partnered with leading global energy producer, EDL. Per the deal, EDL will expand an existing solar installation at Rio Tinto’s Weipa mine in Queensland. Australia. EDL will add a 4 MW solar power generating capacity and 4 MW/4 MWh of battery storage, which will effectively triple the supply of clean, reliable energy to Rio Tinto’s bauxite mine operations in Weipa and the remote township. This move is in sync with Rio Tinto’s focus on lowering its carbon footprint across its operations and marks a step toward its goal of attaining net zero emissions by 2050.Rio Tinto’s Weipa operations includes three bauxite mines (East Weipa, Andoom and Amrun), processing facilities, shiploaders, an export wharf, two ports, power stations, a rail network and ferry terminals. The development of Amrun, its newest mine that was completed in 2018, has extended the life of the Weipa bauxite operations by several decades.In 2015, Rio Tinto had announced the launch of the Weipa Solar plant, which was the largest solar facility at an off-grid Australian mine site at that time. It was a pathbreaking project, which exhibited the viability of renewable energy systems in remote locations. EDL will now build, own and operate a new 4 MW solar plant and 4 MW/4 MWh of battery storage at Weipa that will complement the existing 1.6 MW solar farm. Work on the project is expected to be completed by late next year.Once operational, the combined 4 MW solar capacity and 4 MW/4 MWh battery will have an annual capacity of 11 gigawatt hours of energy. Combined with upgrades to the existing Weipa power generation network, it will effectively cut down Weipa Operations’ diesel consumption by around 7 million litres per year. It will also help lower its annual carbon dioxide emissions by about 20,000 tons — the equivalent of taking more than 3,750 cars off the road.Rio Tinto has earmarked approximately $1 billion in investments over the next five years to get its operations down to net zero emissions by 2050. Earlier this month, the company announced that it has teamed up with Caterpillar, Inc. CAT to develop zero-emissions autonomous haul trucks for use at Gudai-Darri, which is Rio Tinto’s most technically advanced iron ore mine in the Pilbara region, Western Australia. Earlier in June, the company announced that it will deploy the world’s first fully autonomous water truck at its Gudai-Darri mine also in partnership with Caterpillar.Price PerformanceImage Source: Zacks Investment ResearchIn the past year, shares of Rio Tinto have gained 7.5%, compared with the industry’s growth of 9.0%.Zacks Rank & Stocks to ConsiderRio Tinto currently has a Zacks Rank #5 (Strong Sell).Some better-ranked stocks in the basic materials space are Nucor Corporation NUE and The Chemours Company CC.Nucor has a projected earnings growth rate of around 508% for the current year. The company’s shares have soared 112% in a year. It currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.Chemours has an expected earnings growth rate of around 86.4% for the current year. The company’s shares have gained 39% in the past year. It currently carries a Zacks Rank #2 (Buy).  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 Rio Tinto PLC (RIO): Get Free Report Caterpillar Inc. (CAT): Free Stock Analysis Report Nucor Corporation (NUE): Free Stock Analysis Report The Chemours Company (CC): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research.....»»

Category: topSource: zacksSep 21st, 2021