iShares Russell 1000 Value
Why the US labor market recovery is weaker than it looks
This article takes a closer look at the unemployment rate in the U.S. and considers the implications for equity investors.
Why Structural Hurdles Could Thwart US Economic Progress
The American economy is facing major structural issues that have the potential to thwart economic progress. The most important hurdle facing the US economy is an aging population.
What Happened to ENI’s Segments 1Q16?
E&P is Eni’s largest segment in contributions to earnings. In 1Q15, the E&P segment contributed about $1.3 billion, to Eni’s adjusted operating income.
Labor Market Slack Impacts Prices and Wages
If the unemployment gap is declining and the participation gap is rising, it could be due to an increase in labor market slack.
Understanding AMD’s Strategy to Improve Cash and Profits
Advanced Micro Devices (AMD) is looking to grow margins by targeting enterprise customers and gamers in the PC space through its new Polaris GPU.
Microsoft Responds to Expected Surge in Enterprise Mobile Apps
The launch of PowerApps holds importance, as the enterprise mobile apps market is expected to surge significantly.
A Look at Shell’s Stock in 4Q15 Prior to Its Earnings Release
In 2015, Royal Dutch Shell’s stock fell. Shell’s stock lost 38% in the trailing twelve months to January 26, 2016.
How GPU Stocks Have Outperformed Semiconductor Stocks
GPU (graphic processing unit) providers NVIDIA and Advanced Micro Devices (AMD) have outperformed other semiconductor stocks.
Why the housing market impacts consumption and equity investors
This article considers the importance of investment, including residential investment, in the support of U.S. consumption data and the implications for investors.
What Does Tesoro’s Refining Index for 2Q16 Suggest?
Before analyzing Tesoro’s (TSO) refining index for 2Q16, let’s take a look at TSO’s refining margin trend up to 1Q16.
What to Expect from Intel’s 1Q16 Earnings
Intel (INTC), a leader in the semiconductor space, is due to announce its fiscal 1Q16 earnings on April 19, 2016.
Oasis Petroleum—small cap growth investors’ oasis?
This article considers the prospects for small cap growth shares such as OAS within the context of the Fed’s dovish March 31 commentary, which has continued to support the equity market.
Part 4: Mid Caps—why value rallies and growth weakens post Fed taper announcement
Value for the long haul The below graph reflects the recent outperformance of mid cap value shares relative to mid cap growth shares since the 2008 crisis, with a more pronounced 10% outperformance since 2013. The prior article in this series demonstrates that mid cap value dominates mid cap growth in the long run, though […]
Why Is Sprint Offering a Discount to Competitors’ Customers?
In this part, we’ll look at one of the reasons behind Sprint’s 50% discount for competitors’ customers.
Citadel Advisors Starts a New Position in Altera Corporation
During 4Q14, Citadel Advisors started a new position in Altera Corporation (ALTR).
Walmart: Price Wars In The United Kingdom’s Grocery Market
The United Kingdom has been one of the most successful overseas forays for Walmart (WMT). The company operates ~576 stores in the country.
How Is Sprint’s Offer for Competitors’ Customers Faring?
Sprint’s offer to the customers of other wireless carriers is for monthly charges associated with the service plan as well as the access line.
Is It Time to Fix America’s Ailing Infrastructure?
The consistent decline in public spending over the last 20 years has led to weak and inefficient infrastructure in the US. According to the Bureau of Economic Analysis, the average age of highways and streets is 28.4 years.
Greenspan’s lament: Consumption is no substitute for investment
Why it’s becoming increasingly difficult to expect sustainable prosperity from additional consumption in the U.S. economy.
What Do Analysts Recommend for Kinder Morgan?
Currently, ~52.6% of analysts rate Kinder Morgan a “buy,” ~42.1% rate it a “hold,” and ~5.3% rate it a “sell.”
Is rising business inventory growth a bull market indicator?
This article considers the implications of growing business inventories in the context of an improving investment environment and the outlook for investors.
Januvia and Janument: An Update on Merck’s Diabetes Franchise after 2Q17
In 2Q17, Merck’s (MRK) Januvia generated revenues of around $948 million, which reflected an ~11% decline on a year-over-year basis and 13% growth on a quarter-over-quarter basis.
Why Was Cloud the Chief Focus for Microsoft in 2015?
Cloud technology is one area that highly dominated Microsoft’s reports, filings, and presentations in 2015.
Kinder Morgan Lowered Its Project Backlog by $3.1 Billion
Kinder Morgan (KMI) decided to slash its quarterly dividend by 75% in the 2016 outlook it released few days ago.
Walmart’s Plan to Return Value to Shareholders
The dividend and share buybacks are likely to provide some appeasement to Walmart shareholders in the face of anticipated headwinds. But what’s behind the value return plan are more troublesome.
Citadel Advisors Raises Position in United Technologies Corporation
United Technologies Corporation (UTC) provides high technology products and services to the building systems and aerospace industries worldwide.
Why the private investment recovery supports the bull market
This series examines the current U.S. macroeconomic data pertaining to domestic investment and considers the implications for both equity and fixed income investors.
Understanding Zimmer Biomet’s Latest Dividend Announcement
On December 18, 2017, Zimmer Biomet Holdings (ZBH) announced a quarterly cash dividend of $0.24 per share for fiscal 4Q17.
Is U.S. consumer spending losing momentum?
While optimists point to this recovery as indisputable evidence that the U.S. economy is the most resilient and dynamic in the world, this reasoning may not fully recognize a variety of risk factors.
T-Mobile’s Capital Expenditures: Expected to Increase in 2Q15
T-Mobile’s capital expenditures are expected to grow 20.3% year-over-year to $1.1 billion in 2Q15. Wall Street expects T-Mobile to generate sufficient cash flows to fund its capital investments in 2Q15.
Wireless Service and Equipment Revenues Decline for Sprint
Sprint’s revenues also declined 3% on a quarter-over-quarter basis by $255 million due to lower revenues in the equipment and wireless revenue segments.
Will Shell’s BG Acquisition and Divestments Affect Its Leverage?
While Shell’s leverage curve will likely rise in the short term, the evolution of its long-term leverage curve will depend on a variety of factors.
What Can We Expect from Marathon Petroleum’s 4Q15 Results?
Marathon Petroleum (MPC) is expected to post its 4Q15 results on February 3, 2016.
Sprint’s Value Proposition in the US Telecom Industry
As of January 21, 2016, EV-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) was 5.6x for Sprint, 7x for AT&T, 6.3x for Verizon, and 7.3x for T-Mobile.
Deflation, Sales Leverage Drove Wendy’s 1Q16 Earnings Margin
In 1Q16, Wendy’s Company (WEN) posted EBIT (earnings before interest and tax) of $63.8 million, which represented an EBIT margin of 16.9%.
Shutdown 101: Why perceived wealth distribution isn’t the reality
Inequality: The which of you with patient ears attend The below chart illustrates the dramatic difference in the reality versus the perception of wealth distribution in the US. The top 20% of the US holds 84% of the wealth, which is quite different from European countries, such as Sweden, which holds closer to 36%. For […]
Shutdown 101: Robert Reich versus Larry Kudlow and US debt
Exploding US debt: Going to Vegas, or garden-variety Keynesianism? The below graph reflects the doubling of publicly held debt under the Obama Administration from roughly 35% to 70% of gross domestic product. However, it also reflects the doubling of publicly held debt under the Reagan Bush Administrations from 1981 to 1993. Given the severity of […]
Kudlow’s lament: Is capital on strike in the U.S.?
Investment in the United States The below graph reflects the capital strike in fixed domestic investment in the United States. The “strike” of U.S. capital is the notion raised by CNBC commentator Larry Kudlow that despite record profits at U.S. companies, profits and capital aren’t recycling back into the U.S. economy as investment. As displayed below, U.S. […]
Retirement pick: Gold and the long-term investor
There is often a debate among academics, financial gurus, asset managers, and advisors as to the place for non-traditional assets in a portfolio.
The taper could affect momentum stocks like Keurig Green Mountain
This article considers the risks associated with investing in high momentum stocks in the current environment of declining Fed bond purchases.
The fed tapers: Will small caps weaken relative to large caps?
Determining which index, with its specific risk factors, is the most appropriate for an investor depends upon the investor’s appetite for risk.
Will the S&P 500 outperform the Russell 2000 under rising rates?
Should interest rates begin rising as a result of a progressive Fed taper, post-2008 investment returns based on index-specific allocation could see major changes.
Why growth beat value by 20% post-2008 but may not continue to
Despite the recent outperformance of growth stocks in the post-2008 economic recovery, in the long run, and over several business cycles, academic studies tend to show that value stocks outperform growth stocks.
Why large cap growth stocks may hold up better with rising rates
This article illustrates the extent to which growth stocks can, and have, drastically outpaced value stocks for short periods of time.
Must-know: Momentum trading the Fed taper and your portfolio
This article considers the role momentum has in investing versus simply day trading, and the implications for equity investors.
Tactics or strategy: Momentum trading the taper and your portfolio
This article considers role momentum has in investing versus simply day trading and the implications for equity investors.
Why external factors affect ISM’s purchasing managers’ index
The ISM will release the manufacturing PMI for August on September 2. The PMI is a composite measure of economic activity. It’s based on surveys of private-sector firms.
Is the Financialization of Education Leading to a US Bubble?
The financialization of education, especially in the United States (IWF) (IWD), has led to an important and emergent risk to the country’s economic future.
The $1.3 Trillion Student Debt Bubble
The rise in the balance of student debt has been driven by an increase in the number of borrowers and a rise in the average debt by each student.
Millennials or Baby Boomers: Who’s Affected Most by Student Debt?
The Baby Boomer generation has also been increasingly contributing to the student debt crisis.
Why Student Debt May Not Affect the US Economy Like Sub-Prime
According to the White House Council of Economic Advisers, “Student debt is less likely to make a recession more severe or slow an expansion in the way that mortgage debt may have.”
US Nominal GDP Seems to Be Signaling a Recession
During his latest webcast, “Turning Points,” Jeffrey Gundlach presented a chart that seems to be signaling a recession in the making.
Clinton or Trump: Who Would Add More to Debt Burden in 10 Years?
According to the CRFB, Hillary Clinton’s plan would increase public debt in the United States (IVV) (VOO) by about $200 billion over the next ten years
Bill Gross Says We Shouldn’t Expect a ‘New Trump Bull Market’
In his investment outlook for November 2016, Bill Gross advises investors to be prepared for lower stock earnings and PE (price-to-earnings) ratios in the future.
Why the biggest risk to equity portfolios is the equity market
The Federal Reserve Bank could end its bond buying program by the end of this year, so it’s important for investors to know how this development could impact their portfolio.
Why Did Microsoft’s Stock Fall after LinkedIn Offer?
After Microsoft’s announcement, LinkedIn’s stock rose 47% to $192.21 while Microsoft’s stock fell 2.6% to $50.14 on June 13, 2016.
Pfizer’s Stock Performance and Earnings Trends
On December 17, Pfizer’s stock price closed at $43.11, which is an ~1.58% decline from its close of $43.80 on December 14.
Stelara and Simponi Drive Johnson & Johnson’s Immunology Business
Johnson & Johnson’s (JNJ) immunology business generated revenue of $3.4 billion in the third quarter.
ADP: May Payrolls Could Be below 180,000
According to the ADP National Employment Report, the US private sector added 178,000 jobs in May.
ADP: US Job Market Could Be Overheating
According to the ADP April National Employment Report, US private sector employment added 204,000 jobs in April.
TMO’s Launch of New Research Assay for Cancer
On December 7, 2017, Thermo Fisher Scientific announced the launch of a new targeted NGS (next-generation sequencing) research panel.
Can Smart Beta Go Wrong?
The smart beta approach aims to benefit from market inefficiencies to deliver higher risk-adjusted returns and improve diversification.
How Merck’s Zepatier and Isentress Are Positioned
Zepatier revenue In 3Q17, Merck’s (MRK) Zepatier generated revenue of $468 million, compared with $164 million in 3Q16. In 3Q17, Zepatier revenue fell 9% QoQ (quarter-over-quarter). During the first nine months of 2017, Zepatier generated revenue of $1.4 billion, compared with $326 million during the same period in 2016. Higher sales growth in the United States, […]
Zimmer Biomet’s Plan to Revive Growth amid Supply Disruptions
Zimmer Biomet Holdings has laid down a dual sourcing strategy to resolve production issues at its Warsaw facility.
Baxter International’s Latest Guidance for Fiscal 2017
Baxter International’s sales growth guidance for fiscal 2017 is expected to be ~4% on a reported basis.
J&J Completed the Divestiture of Its Neurosurgery Business
Johnson & Johnson’s (JNJ) medical device business has been restructuring in order to focus on higher growth areas with potential expansion opportunities.
Abbott’s Breakthrough CGM Device Freestyle Libre Wins FDA Approval
On September 27, Abbott Laboratories (ABT) announced the FDA approval of its Flash CGM (continuous glucose monitoring) device, Freestyle Libre.
HVAD Expected to Expand Medtronic’s Presence in LVAD Segment
On September 27, 2017, the FDA approved Medtronic’s HVAD (HeartWare ventricular assist device) system as a destination therapy for advanced heart failure patients.
MDT’s Diabetes Segment’s Supply Headwinds Expected to Impact Fiscal 2018
In fiscal 1Q18, Medtronic’s (MDT) Diabetes Group reported revenues of $449 million, which represents a year-over-year sales decline of ~1%.
Dentsply Sirona’s Technologies Segment Sales Declined in 2Q17
In 2Q17, Dentsply Sirona’s (XRAY) Technologies business contributed ~44% to the company’s total revenues and registered sales of ~$439 million.
How ProQuad/MMR-II/Varivax Vaccines Are Expected to Perform in 2017
In 2016, Merck’s (MRK) ProQuad reported revenues of ~$495 million, which reflected 9% year-over-year growth.
Medtronic’s Agreement Will Expand the Use of Its Tyrx Envelopes
Medtronic’s (MDT) Tyrx envelope is an antibacterial and fully-absorbable device that helps prevent surgical site infections.
ETFs Are Expected to Post Strong Growth
The total size of the US ETF (VOO) (IWD) industry rose 32% in 2016 to $2.8 trillion due to continued improvement in markets during the period.
Zimmer Biomet’s Inorganic Growth Strategy Is Helping Performance
In October 2016, Zimmer Biomet Holdings announced the acquisition of the RespondWell telerehabilitation platform.
Understanding Thermo Fisher’s Growth Strategy
Thermo Fisher Scientific (TMO) has always focused on innovation as a key growth strategy.
Quest Diagnostics’ Multi-Pronged Strategy to Accelerate Growth
Quest Diagnostics (DGX) expects to witness a 3.0%–5.0% long-term revenue growth rate in the future with earnings growth of 5.0%–9.0%.
Januvia, Vaccines May Drive Merck’s Revenue Growth in 2017
In 2016, Merck & Co.’s (MRK) Januvia franchise managed to report revenue of nearly $6.1 billion, a year-over-year (or YoY) rise of ~2%.
Why Marathon Petroleum’s Adjusted Refining Earnings Fell in 4Q16
Marathon Petroleum witnessed a decline in its adjusted refining earnings in 4Q16. During the quarter, its refining margin fell due to turnaround costs.
Marvell’s Divestment Strategy: Where It’s Headed
Marvell’s (MRVL) restructuring program will involve selling off non-strategic businesses.
Ron Baron’s Investment Strategy to Beat Inflation in the Long Run
Inflation is expected to reduce the value of assets if the price rise of the asset doesn’t catch up with inflation. Core inflation in the United States is growing at a rate of ~2%.
Merck Continues to Dominate with Its Januvia Franchise
Despite more competition and pressures, Merck’s Januvia franchise continued to maintain its leadership in the DPP-4 inhibitor class of diabetes drugs.
How Is Thermo Fisher Scientific’s FEI Integration Process Going?
Thermo Fisher Scientific (TMO) completed the acquisition of FEI Company on September 19, 2016.
Medtronic’s RTG Sales in Fiscal 2Q17: The Brain and Restorative Therapies Story
Of Medtronic’s ~$7.3 billion in worldwide revenue in fiscal 2Q17, ~$1.8 billion came from its RTG segment, representing ~25% of the company total.
Inside WFT’s Free Cash Flow Expectation for 4Q16
Weatherford International’s CFO was negative in 3Q16, although it improved marginally over 2Q16. WFT generated -$106 million in CFO in 3Q16.
Toviaz Expected to Report Stable Revenues in 2016
A strong patent estate for Toviaz and multiple other products has enabled Pfizer (PFE) to pose strong competition to other big pharma players such as Merck (MRK), Eli Lilly (LLY), and Novartis (NVS).
What’s Fueling the Bull Run? Richard Bernstein Explains
A bull run with legs In Richard Bernstein Advisors’ October Insights newsletter, after dismissing the belief that the Federal Reserve is to blame for stock price inflation (IWD) (VTV), Richard Bernstein moved on to explain the reason for the current bull run. Stating that “fundamentals have improved dramatically, and have been a major support to the […]
Where Petrobras’s Forward Valuations Stand Compared to Its Peers’
Petrobras is trading at a two-year forward EV-to-EBITDA ratio of 4.8x, below the peer average of 5.4x.
BP’s Forward Valuations: A Peer Comparison
In this article, we’ll consider BP’s forward valuations compared to those of its peers. BP’s market cap stands at ~$105 billion.
Why WFT Expects Its Free Cash Flow to Improve in 2H16
In this article, we’ll analyze how Weatherford International’s (WFT) operating cash flow has trended over the past few quarters.
Which Sectors Will Benefit from Rising Prices?
The Janus Asset Allocation team believes the demand-pull inflation will help the consumer discretionary sector.
Are Stocks Really Cheap Relative to Bonds?
Based on the Fed Model, Bank of America Merrill Lynch argues that stocks are still cheap compared to bonds despite the recent rally in the S&P 500 (IVV) (SPY).
Total’s 2Q16 Earnings Surpass Estimates: How Do They Compare?
Total SA (TOT) posted its 2Q16 results on July 28, 2016. In this series, we’ll compare Total’s 2Q16 numbers with its estimates and evaluate its 2Q16 segmental performance.
Analysts’ Recommendations for JNJ after 2Q16 Earnings
The consensus 12-month target price for JNJ is $124.20, which represents a drop of 0.9% from the stock’s closing price of $125.20 on July 19, 2016.
Where Does SU’s Implied Volatility Stand ahead of Its Earnings?
Suncor Energy’s (SU) implied volatility currently stands at 28.1. Since February 11, 2016, SU’s implied volatility has fallen by 46%.
How Innovation Is Driving Thermo Fisher Scientific’s Growth
Thermo Fisher Scientific now has more than 800,000 products in its portfolio and has an extensive product pipeline.
How Did Spansion Merger Synergies Affect Cypress’s Earnings?
Unlike the gross margin, Cypress’ non-GAAP (generally accepted accounting principles) operating margin did not take a hit due to the Spansion merger.
What Will Drive Intel’s Profits Going Forward?
Intel dominates the data center processor market with a market share of over 99%.
ExxonMobil’s Downstream Portfolio Fortifies Its Integrated Model
ExxonMobil is expanding, modernizing, and upgrading its downstream assets to augment the use of its upstream and midstream capabilities.
How Did Shell’s BG Group Acquisition Affect Its Leverage?
Shell’s net debt almost doubled over 1Q14 to $70 billion in 1Q16. This was led by a 77% rise in its total debt over 1Q14 to $81 billion in 1Q16.
ExxonMobil Plans to Exit the Bass Strait Oilfields
ExxonMobil (XOM) is churning its upstream portfolio to retain the most competitive assets in a low energy price environment.