Intense competition leads to low profit margins for automakers
The auto industry has lower margins primarily because of intense competition. It makes it difficult for companies to pass on increases in raw material prices to the customer.
Financials
Why Cliffs plans to reduce its capex going forward
Cliffs Natural Resources’ (CLF) estimation for the 2015 annual capital expenditure, or capex, is $125–$150 million.
What impacts an insurer’s profits?
In 2013, the top ten life and health insurance companies had just above 50% market share in terms of direct premiums written.
How cost structures and distribution channels impact profit
As customers use Internet-based aggregators to purchase insurance policies, insurers use online sales to interact directly with customers and reduce costs.
How investment income drives profit
The impact of interest rate movements is lower in the P&C segment, as their products can be repriced annually to keep in line with interest rate movements.
How key drivers impact insurance sales
For P&C insurers such as AIG and ACE, various mandatory requirements may drive sales of vehicle, workers’ compensation, and homeowners insurance.
The US insurance industry: Largest in the world
Insurance premiums have grown at a modest pace after a dip in 2009 due to the financial crisis, which the industry was able to navigate.
Life insurance, P&C insurance, and reinsurance
P&C products have commoditized characteristics, resulting in sharp competition in the market and business cycles. AIG and ACE are key players in this space.
Making sense of an insurer’s liabilities
Policyholder liabilities, or policyholder reserves, represent the future claims that may arise for the pool of policies the insurer writes.
How valuation of insurance companies works
Financial market movements not only impact income from invested assets, but also the value of assets carried at fair value on an insurer’s balance sheet.
Global money supply and its link to gold
The gold price increase kept pace with the global money supply until recently. The relationship between the two appears to have broken.
Get Real: Recession Fears, Is It Time to Panic?
In today’s Get Real, we saw the rationale of recession fears, the latest about Tesla’s European Gigafactory, Nike’s departure from Amazon, and more.
Market Crash Imminent, Say Super Rich: Time to Panic?
According to CNBC, a UBS survey of high-net-worth individuals has found that more than half of the respondents foresee a market crash next year.
Apple Card in Hot Water Over Alleged Credit Limit Bias
The Apple Card is currently under regulatory scrutiny related to gender-biased credit limit approvals, according to a Bloomberg report on November 9.
Consumer Goods Impact
Plastic packaging waste has become an important issue for consumer packaged-goods companies.
Get Real: Big Tech Companies Dominate
In today’s Get Real, we saw updates on big tech companies’ latest happenings. Plus, more earnings results, projections, and expectations.
How Are Citadel Advisors Hedging their Portfolio?
Kenneth Cordele Griffin is the CEO of investment management firm Citadel Advisors LLC. He is the hedge fund manager and he founded Citadel in 1990.
Tesla’s Real Competition: Automakers or Mega-Tech?
Tesla (TSLA) stock has been polarizing like no other. Analysts and investors have very strong views about the stock on either side.Financials Richard Fisher explains why excess reserves can create velocity
Richard Fisher also discussed the impact of quantitative easing (or QE) on excess reserve balances held by depository institutions at his speech at the London School of Economics on Monday, March 24.
US GDP Shatters Expectations, Pessimists Run for Cover
The US GDP increased at an impressive rate of 1.9% for the third quarter. The growth beat the expectations of around 1.6% for the quarter.Financials Why do investors continue to prefer floating-rate notes?
Last week’s Treasury auctions included $13 billion two-year Treasury FRNs auctioned on May 28. The FRNs were indexed to the May 19 13-week Treasury bill auction high rate,.Financials Issuers like Wells Fargo and Verizon take advantage of low yields
Major deals included debt issues by Wells Fargo (WFC), Baidu, AT&T, and Verizon (VZ).Financials Investing in fixed income: What motivates bond investors?
We can understand the investment objectives of fixed income investors in terms of returns, risks, and constraints. There are two categories of investors.Financials Must-know: Spain’s economy
Spain’s potential rating upgrade rests largely on its debt ratio being brought to a declining trend within the forecast period, which ends in 2015. According to an export performance Organization of Economic Co-operation and Development (or OECD) indicator, Spain has gained market share for the past 20 years.
Why the price-to-book value ratio’s the most used valuation
The price-book value ratio is the ratio of the market value of equity to the book value of equity. Price stands for the current market price of a stock. Book value is the total assets minus liabilities, or net worth, which is the accounting measure of shareholders’ equity in the balance sheet.
Overview: Davidson Kempner Capital Management’s 2Q14 positions
Davidson Kempner Capital Management LLC is a hedge fund manager. It manages ~$22 billion in assets. In 2Q14, Davidson Kempner Capital added new positions in Ally Financial Inc. (ALLY), WL Ross Holding (or WLRH), Newell Rubbermaid (NWL), and B/E Aerospace (BEAV).
Must-Know: Credit and Liquidity Risks in Banking
The top risks that every bank faces are credit risk and liquidity risk. We’ll look at the banks that managed this risk safely, and those that didn’t.
Bank Risks: Everything You Need to Know
The banking sector faces several risks. Given the sector’s systemic importance, it’s important that bank risks are properly understood and addressed.
Amazon: Analysts Revise Target Price, Earnings Are a Concern
Amazon (AMZN) shares are trading close to 4% in early-market today. The company announced its third-quarter results on Thursday.
Bank of America Stock: Analysts Are Upbeat
Most of the analysts covering Bank of America stock recommend a “buy.” On Tuesday, Atlantic Equities upgraded the stock to “overweight” from “neutral.”
Adobe, Workday, and ServiceNow Fall Due to Downgrades
Adobe (ADBE), Workday (WDAY), and ServiceNow shares have lost significant market value in early-market trading today. Adobe stock has fallen close to 4%.
Get Real: Misunderstood and Undervalued?
In today’s Get Real, we focused on Bill Ackman’s Berkshire Hathaway comments, Mexico’s major cannabis milestone, earnings season, and much more.
Mike Wilson: Growth Stocks Could Decline 20-30%
On October 10, in an interview with CNBC, Mike Wilson said investors should focus on the fundamental story. He’s worried about expensive growth stocks.
Are ‘Tesla-Killers’ Free Advertising for Tesla?
Last week, Porsche unveiled its Taycan. While the model has attracted a lot of attention, it may also be providing a form of free advertisement for Tesla.
Could Microsoft Enter the Indian Banking Domain?
Last week, Microsoft (MSFT) was the stock to watch. Jefferies Group LLC raised the target price for Microsoft shares to $160 this week.
China’s De-Dollarization amid Trade War: Gold’s Upside?
China continued buying gold for the tenth consecutive month in September. The country also continued its de-dollarization bid.
A November Stock Market Crash? Think Guns N’ Roses
Unofficial job numbers showed a slowdown in job creation. This hit the stock market hard. The S&P500 dropped 1.8% yesterday while Dow Jones fell 1.9%.
Boeing to Miss Aircraft Delivery Aim by 50% on MAX Woes
Boeing (BA) will fall short of its 2019 aircraft delivery target by over 50%, according to Jefferies analyst Sheila Kahyaoglu.
Why Apple Services Are Overshadowing the iPhone
By 2020, Apple aims to double its Services revenue from 2016. Meanwhile, the iPhone is looking less and less important for the company.
Ex-Fed Official Says Crypto Won’t Replace US Dollar
Former Fed official Simon Potter seemed to side with Trump and Powell, critiquing crypto and defending fiat money. Is he right to take this position?
Soros Exits, Buffet Increases: Who Is Right on Apple?
In Q4 2018, legendary investor George Soros sold all his holding in Apple (AAPL). In Q3 2018, Apple represented around 0.2% of his total portfolio.
Apple’s iPhone 11 Could Drive Fiscal 2020 Sales
Apple’s (AAPL) iPhone 11 preorders have been encouraging. Furthermore, demand for the iPhone 11, Pro, and Pro Max are exceeding supply chain expectations.
Verizon and Wells Fargo Are Getting on the Blockchain
Verizon (VZ) and Wells Fargo (WFC) are taking steps to integrate blockchain technology into their business models. Here’s why.
Goldman Sachs: Expect Volatile October, Rising Gold
Yesterday, Goldman Sachs’ strategist warned of high volatility in October. Based on Goldman Sachs’ data, since 1928 volatility in October is 25% higher.
Gundlach Discussed the Fed, Trade Deal, and Gold
Gundlach thinks that we’ve already seen a bottom in interest rates for 2019. US Treasury yields have been hitting lows in 2019.
Dow Jones Index Falls after Rising for Eight Days
The Dow Jones Industrial Average Index has fallen 0.4% or by 115 points today. The index is trading lower after rising for eight consecutive trading sessions.
How Apple Stock Performed Last Week
Apple stock rose 2.6% last week. Its performance was a tad volatile, with its shares rising 4.6% in the first four days and falling 2% on Friday.
An Overview of the US Banking Sector
The banking sector plays a pivotal role in our daily lives. This series explores the sector, its driving factors, and its key indicators and latest trends.
Coupa Index Flashes Red Light on Economy after PMI
Today, the third-quarter Coupa Business Spend Index was released. It’s a relatively new economic indicator that offers insights into corporate spending.
HEXO: What’s the Word on the Street?
HEXO stock has suffered since it reported lower-than-expected third-quarter results in June. The stock has fallen 31.8% since its earnings on June 12.