PowerShares S&P 500 Low Volatility ETF
Betting against Volatility: Worth the Risk?
The CBOE Volatility Index (VIX) measures the volatility in the US stock market as represented by the S&P 500 Index (SPY) (SPX-Index).
Why ETFs Are Seeing Increased Popularity
Mutual fund ownership of equities is at the lowest level in ~13 years, while ETFs (SPY) (IVV) are gradually increasing their share in the stock market.
Quest Diagnostics Projects Run Rate Savings by End of 2017
Quest Diagnostics (DGX) has projected a run rate savings worth $1.3 billion by the end of 2017. In 2016, it managed to save up to $1.1 billion.
Why Most Analysts Are Neutral on McCormick
McCormick (MKC) stock is covered by 14 analysts, who have rated the company a 2.8 on a scale of 1.0 (“strong buy”) to 5.0 (“strong sell”).
How Is Stryker Moving Forward with International Growth?
Stryker is a highly diversified company with a presence across the world. However, a majority of the company’s revenue, or 72%, comes from its US business.
Narayana Kocherlakota on Trump and the Federal Reserve
Narayana Kocherlakota, 12th president of the Federal Reserve Bank of Minneapolis, said central banks have been able to control inflation better when left alone by the government.
Will Becton, Dickinson and Company’s Revenue Rise?
Wall Street estimated that Becton, Dickinson and Company’s fiscal 4Q16 revenue will be ~$3.22 billion—growth of around 5.2% on a YoY basis.
How Should Fund Investors Approach the US Presidential Election and the Fed’s Impending Rate Hike?
If you’ve reached your investment horizon and have seen substantial gains, it would be wise to liquidate or reallocate to more conservative funds.
Richard Bernstein: Don’t Fear the Bear Market
A legitimate bull market In this series, we’ve taken a look at Richard Bernstein’s views on investors’ fear of an impending bear market. In Richard Bernstein Advisors’ October Insights newsletter, he rejects the notion that the current rise in US stocks (SPLV) (OEF) has been brought about only by the Fed’s easy monetary policy. In the […]
A Look at the Fund Flows in Low-Volatility ETF SPLV
The anticipated views of the Federal Reserve members are expected to make way for utilities (IDU) (VPU) and for low-volatility funds.
Why Are Low-Volatility Funds Witnessing Higher Instability?
Low-volatility funds generally have higher exposure to stocks that are insulated from large swings in the broader markets.
Delving into Zimmer Biomet’s Acquisition of CD Diagnostics
On August 15, 2016, Zimmer Biomet Holdings (ZBH) announced the acquisition of CD Diagnostics.
How MAKO Robots Could Contribute to SYK’s Orthopedics Growth
Stryker (SYK) entered the robot-assisted surgery market with its acquisition of MAKO Surgical in December 2013.
Does Richard Bernstein Think US Stocks Are Fairly Valued?
Richard Bernstein Advisors is bullish on US equities. A major reason that drives its enthusiasm for US stocks is its assessment that the worst of the corporate profits recession is already over.
What Could Benefit J.M. Smucker’s 1Q17 Earnings?
Analysts are expecting J.M. Smucker’s adjusted EPS to be $1.74 in fiscal 1Q17 compared to 1Q16 EPS of $1.32.
What Could Benefit Hormel Foods’ Revenue in Fiscal 3Q16?
Analysts expect revenue of $2.2 billion for Hormel Foods (HRL) in fiscal 3Q16—3% higher than revenue of $2.19 billion in fiscal 3Q15.
C.R. Bard Registered Strong 2Q16 Performance, Beat Estimates
On July 26, 2016, C.R. Bard (BCR) released its 2Q16 earnings. After the announcement, BCR’s share price rose by ~1%, driven by its better-than-expected 2Q16 results.
Will Kellogg Report Lower Revenue Again in 2Q16?
Analysts expect Kellogg’s revenue to be $3.36 billion for fiscal 2Q16. This represents a decline of 4% compared to revenue of $3.50 billion in 2Q15.
How Does Ingredion Compare to Peers on Key Moving Averages?
On July 15, 2016, Ingredion (INGR) closed at $132.84. It traded 15.6% above its 100-day moving average, 8.3% above its 50-day moving average, and 3.9% above its 20-day moving average.
What Are Analysts Saying about Ingredion before 2Q16 Results?
As of July 15, 2016, Ingredion (INGR) was trading at $130.90. Analyst recommendations remained the same with an update in the target price.
How Is Mead Johnson Improving Its Product Portfolio in China?
China accounts for around one-third of Mead Johnson’s global business.
Why Did Hershey’s Stock Rise on June 30?
The Hershey Company (HSY) has a market cap of $24.2 billion. Its stock rose by 16.8% to close at $113.49 per share on June 30, 2016.
J.M. Smucker’s Coffee, Pet Foods Segments Drove Its Fiscal 4Q16
J.M Smucker derives its revenue from the U.S. Retail Coffee, U.S. Retail Consumer Foods, U.S. Retail Pet Foods, and the International and Foodservice segments.
Earnings Growth Led J.M. Smucker’s Stock Performance
The J.M. Smucker Company (SJM) reported its fiscal 4Q16 and fiscal 2016 results on June 9, 2016. The company ended fiscal 2016 with strong earnings.
General Mills Declared Increased Dividend in Fiscal 4Q16
With its fiscal 4Q16 earnings release, the General Mills board approved a quarterly dividend of $0.48 per share. It will be paid on August 1, 2016.
How Has Becton Dickinson’s Stock Performed?
Becton Dickinson has returned ~20% over the last one year. It outperformed the S&P 500 Index, which returned around -1.2% during the same period.
How Has Zimmer Biomet’s Stock Performed Recently?
Zimmer Biomet Holdings (ZBH) was trading at $116.5 as of June 17, 2016. It has a 50-day moving average of $118.5 and a 200-day moving average of $106.1.
How Does Varian Medical Systems Compare to Peers on Valuation?
On June 16, 2016, Varian Medical Systems (VAR) was trading at a forward PE (price-to-earnings) ratio of ~17.7x.
Varian Medical Systems: A Leading Oncology Device Manufacturer
Varian Medical Systems (VAR), headquartered in Palo Alto, California, is a leading radiation oncology treatment device and software manufacturer. It reported revenues of approximately $3.1 billion in 2015.
Richard Bernstein Advisors Expects Corporate Profits to Grow 20%
Richard Bernstein Advisors’ earnings forecast for the 12-month period until June 2017 is ~$115. The S&P 500 PE multiple is ~24.
Could the Grey Swan Event Elude Stocks and Bonds?
Analyzing the superior performance of stocks and bonds over the past 40 years, Bill Gross called the run a “grey swan” if not a black swan event.
What Could Benefit J.M. Smucker’s 4Q16 Earnings?
Analysts are expecting J.M. Smucker’s adjusted EPS to be $1.19 in fiscal 4Q16—compared to 4Q15 EPS of $0.98. It represents a tremendous rise of 21%.
Analyzing ADM’s Balanced Capital Allocation Framework
In 2016, Archer Daniels Midland’s priority is its balanced capital allocation framework. It started by selling a 50% interest in its Brazilian port in 2015.
Jeffrey Gundlach: Buy Mortgage REITs, Short Utilities
Gundlach thinks that investors should short low volatility equity funds. People invest in them thinking that they’re safe, but they aren’t.
By How Much Did Altria’s 1Q16 Earnings Outperform Estimates?
Altria Group (MO) released its 1Q16 earnings on April 28, 2016. Its adjusted diluted EPS (earnings per share) rose 14.3% to $0.72 in 1Q16.
Baxter Exhibits Strong 1Q16 Performance, Beat Estimates
On April 26, 2016, Baxter International (BAX) released its 1Q16 earnings. After the announcement, Baxter’s share price rose ~1% from $43.63 on April 25, 2016, due to the company’s better-than-expected 1Q16 results.
Why Kellogg Didn’t Have a Good End to 2015
For fiscal 2015, Kellogg’s reported net sales fell by 7.2%. The currency-neutral adjusted net sales rose by 1.2%. Sales fell for all of the segments in 4Q15.
What Are Archer Daniels Midland’s Priorities for 2016?
In 2016, Archer Daniels Midland’s priority is its balanced capital allocation framework. It started by selling a 50% interest in its Brazilian port in 2015.
Is Bunge Expected to Report Lower Earnings in 1Q16?
In 2015, Bunge returned $549 million to shareholders through dividends and share repurchases. In 2014 and 2015, the company purchased a total of $600 million in shares.
Baxter Is Expected to Witness Lower Revenues in 1Q16
Wall Street has estimated Baxter’s 1Q16 revenues to be about $2.4 billion, a marginal decline as compared to last quarter’s revenues of ~$2.5 billion.
Will the Old Spice Lawsuit Hurt P&G’s Margin in Fiscal 3Q16?
With the lawsuit filed against P&G’s Old Spice, margins could contract in the coming quarter as revenue would be affected.
How Does General Mills Maintain Its Strong Margin Discipline?
General Mills displayed a fifth consecutive quarter of operating margin expansion. The adjusted operating profit margin increased by 60 basis points to 15.9% compared to 15.3% in fiscal 3Q15.
General Mills’ Fiscal 3Q16: Green Giant Divestiture Caused Sales Dip
The Green Giant divestiture, along with continued foreign exchange headwinds, impacted the net sales of General Mills (GIS), as anticipated by the company.
What Analysts Are Saying about Becton Dickinson Now
Analysts estimate that Becton Dickinson has a potential to return ~6.4% over the next 12 months. The 12-month target price for BDX is $163.10 per share.
How Does McCormick Compare to Peers on Key Moving Averages?
McCormick & Company (MKC) closed at $95.84 on March 23. It is trading 10% above its 100-day moving average, 7% above its 50-day moving average, and 2% above its 20-day moving average.
Gauging the Impact of Foreign Currency Exchange on CPG Companies
CPG companies are geographically diverse and face stiff competition from internationally and nationally advertised brands across categories.
How Did Snyder’s-Lance End Fiscal 2015?
Snyder’s-Lance reported its fiscal 2015 results on February 29. The final results met the preliminary results that the company reported at the end of January.
Why Did Campbell Soup’s Fiscal 2Q16 Earnings Rise 22%?
In its preliminary results for 2Q16, Campbell Soup mentioned that it expected its adjusted EPS for the quarter to be ~$0.87. It was in line with the expectations.
Did WhiteWave Foods’ Revenue Meet Expectations in 4Q15?
WhiteWave Foods (WWAV) was expected to report revenue of $1,034 million for 4Q15, a rise of 13.5% YoY (year-over-year). The company reported $1,027 million, an increase of ~13% compared to 4Q14.
Tyson Foods’s Revenue Is Expected to Fall 7% in Fiscal 1Q16
Tyson Foods’s (TSN) revenue is expected to fall by 7.2% to $10.0 billion for fiscal 1Q16. Although positive, the revenue growth has been on a declining trend.
McCormick Expects Its Sales to Grow in Fiscal 2015
McCormick has a dividend yield of 2.0% as of January 21. Management has raised the dividend at an average annual rate of 9.2% over the last five years.
Costco’s Industry Positioning: A Porter’s 5 Force Analysis
Costco’s suppliers include companies like PepsiCo (PEP), Procter & Gamble (PG), and the Kraft Heinz Company (KHC). No single supplier accounts for over 5% of revenue.
General Mills’ Restructuring Initiatives for Its International Segment
During fiscal 1Q16, General Mills (GIS) paid $34 million in cash related to restructuring projects. In fiscal 1Q16, the company approved “Project Compass.”
What Impacted General Mills’ Sales in Fiscal 1Q16?
General Mills’ net sales for fiscal 1Q16 fell by 1% to $4.2 billion. The foreign currency exchange effect caused the growth to fall by five percentage points.
Diamond Foods’ Earnings Missed Estimates in Fiscal 1Q16
Diamond Foods missed estimates by 12.5% for the first time in the last five quarters. It had surpassed estimates for EPS in all the four quarters of fiscal 2015.
What Affected Diamond Foods’ Declining Sales?
Diamond Foods reported a fall in sales in fiscal 4Q15 of 7.9% compared to the same quarter in the prior fiscal year. It also reported net sales of $201.8 million.
Will Diamond Foods Continue Its Growth in Earnings?
Diamond Foods surpassed estimates for EPS in all the four quarters of fiscal 2015. In its last reported fiscal 4Q15, the company beat EPS estimates by 10%.
Bill Gross Shuns the Taylor Rule and the Phillips Curve
The Taylor rule is a backward-looking model used to determine short-term interest rates in an economy. Bill Gross prefers a corollary to Gresham’s law.
A Comparative Analysis of SPLV’s Portfolio with the Market
SPLV’s top five holdings are Plum Creek Timber (PCL), Paychex (PAYX), PepsiCo (PEP), ACE (ACE), and Republic Services (RSG).
An Overview on SPLV’s Low Volatility Holdings
SPLV maintains a portfolio of 100 stocks on the basis of minimal volatility. It majorly invests in the financial, consumer staples, and industrial sectors.
A Structural Analysis of SPLV
The PowerShares S&P 500 Low Volatility ETF (SPLV) seeks to replicate the performance result of the S&P 500 Low Volatility Index.
A Fund Flow Analysis of SPLV
For the current year, SPLV’s share redemptions have exceeded share purchases, which has resulted in negative fund flow, or an outflow, for the ETF.
An Overview of Smart Beta Fund SPLV
SPLV’s top holdings of include PepsiCo (PEP), ACE (ACE), Republic Services (RSG), Procter & Gamble (PG), and McDonald’s (MCD).
What’s the Biggest Driver of Earnings Growth?
Economic growth is the biggest driver of earnings growth. Earnings growth seems to follow the same trajectory of GDP growth.
Asia Segment Contributed 49% to Mead Johnson’s Sales in 3Q15
On October 20, 2015, Mead Johnson’s board of directors approved a new share repurchase authorization of $1.5 billion of the company’s common stock.
How Minimum Volatility ETFs Are Affected by the Volatility Index
The VIX is a measure of the total implied volatility of the market. It has an inverse relationship with minimum volatility funds.
A Comparative Analysis of Smart Beta Funds
Smart beta fund indexes are tweaked to acquire active management factors such as value, quality, size, and growth.
Diamond Foods Beat Consensus Earnings Estimates by 10%
Diamond Foods provided annual adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) guidance of $131–$136 million.
Snacks Segment Contributed 64% to the Net Sales in 4Q15
The Snacks segment offers microwave popcorn products and potato chips. The net sales for the quarter were reported $129.8 million.
General Mills’ Restructuring Plans for Its International Segment
In 1Q16, General Mills paid $34 million related to restructuring initiatives. The company expects to incur ~$71 million in other project-related costs.
General Mills 1Q16 Performance: Further Breakdowns
General Mills’ total segment operating profit rose by 20% to $826 million. On a constant-currency basis, its total operating profit increased by 23%.
ConAgra Foods’s Disappointing Performance in 1Q16
ConAgra Foods (CAG) recorded 1Q16 diluted earnings per share (EPS) from continuing operations at $0.38. This is in comparison to EPS of $0.22 for 1Q15.
Coffee Holding: How Did It Perform in 3Q15?
Coffee Holding (JVA) reported its 3Q15 financial results on September 14, 2015. Net sales increased to $27.0 million compared to $26.6 million in 3Q14.
Minimum Volatility Portfolios of USMV and SPLV Reduce Risk
The iShares MSCI USA Minimum Volatility ETF (USMV) selects stocks for its portfolio on the basis of volatility. USMV’s top holdings include AT&T (T), McDonald’s (MCD), and AutoZone (AZO).
A Must-Read Comparative Analysis of SPLV and USMV
The iShares MSCI USA Minimum Volatility ETF (USMV) and PowerShares S&P 500 Low Volatility Portfolio (SPLV) are two smart beta ETFs that include only those stocks from the S&P 500 index (SPY) that have low volatility.
Understanding the Investment Strategy of SPLV
SPLV currently manages a total portfolio of $4.48 billion distributed over 100 stocks. It has a net expense ratio of 0.25%
J.M. Smucker Reports Better-Than-Expected 1Q16 Results
J.M. Smucker’s (SJM) 1Q16 earnings showed strong sales growth in coffee and pet food. The results include the operations of Big Heart and Sahale Snacks, which Smucker acquired this fiscal year.
J.M. Smucker Stock: Its Reaction to the Earnings Release
On August 27, the J.M. Smucker Company (SJM) announced results for 1Q16, which ended July 31. SJM stock rose 6.54% that day, closing at $116.29, and has been rising since.
What Were Hain Celestial’s Achievements in Fiscal 2015?
Hain Celestial provided annual guidance for fiscal 2016. The total net sales range from $2.97 billion to $3.11 billion—a rise of ~10%–15% compared to fiscal 2015.
Kraft Heinz: What Happened after the Merger?
The Pittsburgh-based, privately owned ketchup maker H.J. Heinz Holding Corporation acquired Kraft Foods last month.
The Coca-Cola Bottler Merger’s Strategic Benefits
The new company, Coca-Cola European Partners PLC (or CCEP), expects to realize significant synergies from the transaction.
CVS Health’s Financial Performance in 2015
CVS Health posted a strong financial performance in 1Q15. Adjusted EPS in 1Q15 grew 12.2% year-over-year to $1.14. CVS came in ahead of its own guidance by a long margin.
How CVS Plans to Make Target’s Pharmacies Profitable
CVS is planning to transfer Target’s generic business to Red Oak Sourcing. Target currently sources from McKesson.
What Happens to Waste? The Basics of Municipal Waste Management
In simple terms, municipal solid waste is trash or garbage discarded by households and commercial establishments.
Why Walmart’s Stock Is Less Volatile
Walmart (WMT) has a history of increasing dividends. Its stock is classified as a dividend aristocrat. At 2.4%, Walmart’s dividend yield is healthy.
Currency-hedged ETFs: Focus shifts to emerging markets
Yen’s historic decline in 2013 may have magnified the benefits of currency hedging.
An overview of some of the ETFs designed to manage volatility
Here is a brief overview of some ETFs/ETPs that are designed for managing volatility: Low volatility ETFs and VIX-based ETPs.