symbol
stringlengths 1
9
| title
stringlengths 1
701
| text
stringlengths 1
140k
|
|---|---|---|
WFC | Wells Fargo Agrees To 65 Million Settlement With New York State | Wells Fargo Company NYSE WFC is a diversified community based financial services company with 1 9 trillion in assets Wells Fargo s vision is to satisfy our customers financial needs and help them succeed financially Headquartered in San Francisco Wells Fargo provides banking insurance investments mortgage and consumer and commercial finance through more than 8 400 locations 13 000 ATMs the internet wellsfargo com and mobile banking and has offices in 42 countries and territories to support customers who conduct business in the global economy With approximately 268 000 team members Wells Fargo serves one in three households in the United States
Want to learn more about ValuEngine Our methods Our history
Fallout from Wells Fargo s shady business practices continues to damage the banking firm Today it was announced that they would pay 65 million to the state of New York in order to settle a suit filed by the New York State Attorney General
Wells Fargo engaged in a variety of illegal activities as part of its cross selling scandal This payment settles one aspect of the case the one related to lying to investors about the cross selling and its role in boosting the financial appeal of the bank
The NY AG was quick to point out that they are still looking at a variety of other illegal practices These activities included setting up new accounts for customers who never asked for them so that managers and others could garner big bonus payments The bank in fact set up as many as two million accounts without customers knowing about them Bank employees also enrolled customers in a variety of services without consent
Shares of the bank dropped on the news
VALUENGINE RECOMMENDATION ValuEngine continues its HOLD recommendation on Wells Fargo Company for 2018 10 19 Based on the information we have gathered and our resulting research we feel that Wells Fargo Company has the probability to ROUGHLY MATCH average market performance for the next year The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Price Sales Ratio
You can download a free copy of our summary report on Wells Fargo Company WFC from the link below |
WFC | Wells Fargo WFC Gains But Lags Market What You Should Know | Wells Fargo WFC closed the most recent trading day at 53 55 moving 0 6 from the previous trading session This move lagged the S P 500 s daily gain of 0 65 Elsewhere the Dow gained 0 79 while the tech heavy Nasdaq added 1 01
Coming into today shares of the biggest U S mortgage lender had gained 1 1 in the past month In that same time the Finance sector lost 4 88 while the S P 500 lost 6 82
WFC will be looking to display strength as it nears its next earnings release which is expected to be January 11 2019 On that day WFC is projected to report earnings of 1 19 per share which would represent year over year growth of 22 68 Meanwhile the Zacks Consensus Estimate for revenue is projecting net sales of 21 27 billion down 3 53 from the year ago period
Looking at the full year our Zacks Consensus Estimates suggest analysts are expecting earnings of 4 29 per share and revenue of 86 13 billion These totals would mark changes of 4 38 and 2 29 respectively from last year
It is also important to note the recent changes to analyst estimates for WFC These revisions typically reflect the latest short term business trends which can change frequently With this in mind we can consider positive estimate revisions a sign of optimism about the company s business outlook
Research indicates that these estimate revisions are directly correlated with near term share price momentum Investors can capitalize on this by using the Zacks Rank This model considers these estimate changes and provides a simple actionable rating system
Ranging from 1 Strong Buy to 5 Strong Sell the Zacks Rank system has a proven outside audited track record of outperformance with 1 stocks returning an average of 25 annually since 1988 Within the past 30 days our consensus EPS projection has moved 0 52 lower WFC is currently a Zacks Rank 3 Hold
Digging into valuation WFC currently has a Forward P E ratio of 12 42 This represents a premium compared to its industry s average Forward P E of 11 37
Meanwhile WFC s PEG ratio is currently 1 19 The PEG ratio is similar to the widely used P E ratio but this metric also takes the company s expected earnings growth rate into account Banks Major Regional stocks are on average holding a PEG ratio of 1 2 based on yesterday s closing prices
The Banks Major Regional industry is part of the Finance sector This group has a Zacks Industry Rank of 71 putting it in the top 28 of all 250 industries
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors Our research shows that the top 50 rated industries outperform the bottom half by a factor of 2 to 1
To follow WFC in the coming trading sessions be sure to utilize Zacks com |
WFC | Wells Fargo WFC Up 3 1 Since Last Earnings Report Can It Continue | A month has gone by since the last earnings report for Wells Fargo WFC Shares have added about 3 1 in that time frame outperforming the S P 500
Will the recent positive trend continue leading up to its next earnings release or is Wells Fargo due for a pullback Before we dive into how investors and analysts have reacted as of late let s take a quick look at its most recent earnings report in order to get a better handle on the important drivers Wells Fargo Misses on Q3 Earnings Shows Cost ControlImpacted by lower mortgage banking revenues Wells Fargo recorded a negative earnings surprise of 3 4 in third quarter 2018 Earnings of 1 13 per share missed the Zacks Consensus Estimate of 1 17 However the bottom line compared favorably with 83 cents recorded in the prior year quarter Including non recurring items net income for the quarter came in at 6 billion compared with 4 5 billion reported a year ago Lower provisions and higher net interest income aided results Moreover expenses declined However reduced fee income was an undermining factor Further reduction in loans and deposits acted as headwinds in the quarter The quarter s total revenues came in at 21 9 billion in line with the Zacks Consensus Estimate Also the reported figure compared favorably with the prior year quarter figure of 21 8 billion On a year over year basis quarterly revenue generation at the business segments disappointed The Community Banking segment s total quarterly revenues increased 2 6 Wholesale Banking revenues were down 2 7 and revenues in the Wealth and Investment Management unit dipped nearly 1 Loans Non Interest Income Fall Costs Decline NII ImprovesWells Fargo s net interest income NII in the third quarter came in at 12 6 billion up 1 year over year Increased interest income from debt securities mortgages held for sale loans equity securities along with higher other interest income were mostly offset by higher interest expenses Further net interest margin expanded 8 bps year over year to 2 94 Non interest income at Wells Fargo came in at 9 4 billion down marginally year over year primarily due to fall in almost all components of income including mortgage banking and insurance income This was partly offset by net gains from trading activities and equity securities As of Sep 30 2018 total loans were 942 3 billion down around 1 year over year This was contributed by reduction in consumer loans partly offset by higher commercial loans Total deposits came in at 1 3 trillion down 3 1 from the prior year quarter Non interest expenses at Wells Fargo were around 13 8 billion down 4 from the year earlier quarter This decline in costs primarily stemmed from fall in commission and incentive compensation along with lower other expenses Notably decreased operating losses mainly related to non litigation expenses remained a positive The company s efficiency ratio of 62 7 came in below 65 7 recorded in the year ago quarter A fall in efficiency ratio indicates improvement in profitability Credit Quality ImprovesWells Fargo s credit quality metrics improved in the third quarter Allowance for credit losses including the allowance for unfunded commitments totaled 11 billion as of Sep 30 2018 down 9 5 year over year Provision for credit losses was 580 million falling 19 Net charge offs were 680 million or 0 29 of average loans in the third quarter down 5 2 from the year ago quarter s net charge offs of 717 million 0 30 Non performing assets were down 18 8 to 7 6 billion from 9 3 billion reported a year ago Capital PositionWells Fargo has maintained a strong capital position In the July September quarter the company returned 8 9 billion to shareholders through common stock dividends and net share repurchases Wells Fargo s Tier 1 common equity under Basel III fully phased in decreased to 148 8 billion from 152 6 billion recorded in the prior year quarter The Tier 1 common equity to total risk weighted assets ratio was estimated at 11 9 under Basel III fully phased in as of Sep 30 2018 compared with 11 8 recorded in the year earlier quarter Book value per share advanced to 37 55 from 36 92 recorded a year ago OutlookFourth quarter 2018Management currently projects the fourth quarter 2018 effective income tax rate to be approximately 19 Mortgage originations for the quarter are expected to be down due to seasonality in the purchase market Pricing margins remain historically tight due to excess capacity in the industry Further despite stabilization in pricing margins in recent quarters production margin is expected to be within this year s quarterly range of 77 to 97 bps Based on trends in customer behavior Wells Fargo accelerated branch closures since 2016 The company remains confident to complete the divesture of 52 branches in Indiana Ohio Michigan and part of Wisconsin in the fourth quarter 2018 Full Year 2018Net interest income is expected to be up modestly in 2018 reflecting better than expected deposit betas On technology advancement and other factors total branch network is expected to decline to around 5 000 by the end of 2020 Wells Fargo is also reducing properties and other businesses including standalone mortgage locations which stand by more than 10 in 2017 and transitioning operational activities in auto business from 57 regional banking centers into three larger regional sites The consolidation is likely to be completed in 2018 The bank is on track to achieve the targeted 4 billion of expense reductions An initial 2 billion of targeted expense savings is expected by year end 2018 supporting the company s ongoing investment in the businesses which includes a number of key areas such as enhancing the compliance and risk management capability building a better bank and strengthening core infrastructure These projected savings do not include the completion of core deposit intangible amortization expense at the end of 2018 which will amount to 769 million in full year 2018 and also does not include completion of the FDIC special assessment which is anticipated by the end of 2018 Additionally expense savings due to business divestitures are excluded Management anticipates full year 2018 total expenses of 53 5 54 5 billion This expectation includes approximately 600 million of operating losses in 2018 and excludes any outside litigation and remediation accruals or penalties Further quarterly efficiency ratio above 59 is estimated by the end of 2018 excluding any outside litigation accruals Near termManagement estimates the additional 2 billion targeted annual expense reductions by the end of 2019 to trickle down to the bottom line and be fully recognized in 2020 Also expenses are projected to be in the 52 53 billion range for 2019 and 50 51 billion range for 2020 Moreover ROE is anticipated to be 12 15 over the next two years while ROTCE is expected to be 14 17 After declining for five consecutive quarters auto originations have stabilized over the past three quarters With completion of the centralization of collection and funding activities the bank is positioned to start increasing originations over time and currently expects the portfolio of balances to begin growing in mid 2019
How Have Estimates Been Moving Since Then
It turns out fresh estimates flatlined during the past month
VGM Scores
At this time Wells Fargo has an average Growth Score of C a grade with the same score on the momentum front Charting a somewhat similar path the stock was allocated a grade of B on the value side putting it in the second quintile for this investment strategy
Overall the stock has an aggregate VGM Score of B If you aren t focused on one strategy this score is the one you should be interested in
Outlook
Wells Fargo has a Zacks Rank 3 Hold We expect an in line return from the stock in the next few months |
EBAY | Rumor mill drives up eBay 6 | Shares of eBay NASDAQ EBAY are up 5 99 after some unsubstantiated rumors of Carl Icahn taking an interest in the company circulate around The outsized rally is rather surprising considering that at this point there isn t much to the Icahn chatter beyond Twitter posts Trading volume on eBay is already over 8M shares vs the daily average of 10 2M shares Now read |
EBAY | PayPal quarterly profit beats estimates shares rise | By Anna Irrera NEW YORK Reuters PayPal Holdings Inc O PYPL on Thursday reported a third quarter profit that beat analysts estimates as the company signed up more new customers and volume of payments processed rose Net income rose to 436 million or 36 cents per share in the third quarter from 380 million or 31 cents per share a year earlier Revenue rose to 3 68 billion from 3 24 billion Excluding one time items the company earned 58 cents per share beating the average analyst estimate of 54 cents according to Refinitiv For the fourth quarter PayPal expects revenue between 4 20 billion and 4 28 billion in line with analysts estimates of 4 21 billion estimate Shares of the company which separated from ecommerce site eBay Inc O EBAY in 2015 were up 7 percent in trading after the bell on Thursday In September it completed the purchase of Swedish payments firm iZettle its largest ever acquisition As pleased as I am with our financials the highlight of the quarter was our growth in net new actives and engagement PayPal Chief Executive Dan Schulman said on a call with analysts The company added a record 9 1 million new active accounts in the third quarter compared to an increase of 8 2 million a year earlier PayPal processed 143 billion in payments over the period up 24 percent from a year earlier Venmo its peer to peer payment app popular with younger consumers processed 17 billion of payments in the third quarter growing 78 percent And while it is still early our monetization efforts appear to be reaching a tipping point Schulman said
He added that 24 percent of Venmo users have now participated in a monetizable action up from 17 percent last quarter |
EBAY | eBay Pops After Capitulating to Activist Shareholders | Summary
eBay NASDAQ EBAY rose by as much as 4 Friday morning after it announced it had entered into cooperation agreements with two activist shareholders
However at this stage in its current market cycle we see downside risk in the coming months
eBay EBAY Stock Weekly Chart
eBay announced that it had entered into cooperation agreements with activist shareholders Elliott Management and Starboard Value and will add two independent directors to the board This will involve an operating review of its portfolio of services including StubHub and eBay Classifieds
CEO Devin Wenig explained that We see tremendous opportunity ahead and want to see eBay s full potential realized over the long term The initiatives we are announcing today are the result of this constructive dialogue
In reviewing the market cycles for eBay we can see it is still in the rising phase of the current cycle This is an improved stock after a gap in January extended gains Yet we can see in our analysis that a declining phase is likely due before its current cycle ends in April
While in the near term the stock could move higher our forecast is for a dip to near 36 which looks like a nice long side opportunity |
WFC | Exclusive Wells Fargo says auto insurance remediation will not wrap up until 2020 | This version of the story has been refiled to correct date of story By Patrick Rucker WASHINGTON Reuters Wells Fargo NYSE WFC Co will not finish paying back the estimated 600 000 customers it wrongly charged for auto insurance until at least 2020 the bank said in a letter to U S lawmakers seen by Reuters U S regulators slapped Wells Fargo with a 1 billion penalty in April when it admitted to wrongly forcing drivers into auto insurance policies That agreement envisioned the customer payouts would finish within months We will be contacting customers and providing them with compensation in multiple stages throughout 2019 with the final stage scheduled for January 2020 the bank said in a letter dated Oct 9 to the Senate Banking Committee s top Republican and Democrat As Wells Fargo tries to complete a drawn out remediation bank executives are also trying to convince the Federal Reserve to lift a cap on growth put in place due to a string of past sales practice abuses Bank executives have said they expect the Fed to lift that asset cap by the first part of 2019 And while the bank disclosed the auto insurance issue in July 2017 the amount it expects to pay back customers has grown In August Wells Fargo said that it expected to pay back drivers 212 million The bank had originally estimated it would pay out 64 million in cash remediation when it disclosed the problems Drivers who bought a car through Wells Fargo and let their insurance lapse could be charged for force place policies The bank enrolled about 2 million drivers into such policies and more than a quarter of those were not needed regulators have said We regret how this issue impacted our customers We are finalizing our remediation plan which is designed to provide each customer with appropriate compensation for their individual circumstances We look forward to providing our customers with the full compensation they deserve Wells Fargo spokeswoman Catherine Pulley said Wells Fargo plans to automatically refund insurance for drivers in five states but will require drivers in other states to prove that they are entitled to a rebate according to the letter State law in Arkansas Michigan Mississippi Tennessee and Washington demands that drivers be given a chance to dispute force place policies before they are charged and Wells Fargo said it will presume drivers in those states were wronged But drivers in other states must submit evidence that they were pushed into unneeded insurance before Wells Fargo will consider a complete refund according to the letter to Republican Senator Mike Crapo from Idaho and Democratic Senator Sherrod Brown from Ohio Wells Fargo promised to repay customers under a 1 billion settlement the bank reached with the Consumer Financial Protection Bureau CFPB and the Office of the Comptroller of the Currency OCC in April But regulators rejected the bank s payout plan this summer and told Wells Fargo it must do more to make sure that it can find and repay everyone who was overcharged Reuters reported in September Customers who were charged for unneeded insurance could face overdraft fees damaged credit or vehicle repossession As part of its settlement agreement Wells Fargo had to review several years worth of bank and insurance paperwork for those customers
In the letter Wells Fargo said it will make appropriate adjustments to consumer credit scores that might have been hurt by the improper insurance |
WFC | Wise named PGA Tour rookie of the year | Reuters Aaron Wise was named the PGA Tour s rookie of the year on Tuesday after posting four top 10 finishes including his first career win at the AT T NYSE T Byron Nelson The 22 year old resident of Las Vegas was one of eight rookies to qualify for the FedExCup playoffs but the only one to advance to the season ending TOUR Championship Also a runner up at the Wells Fargo NYSE WFC Championship Wise beat Austin Cook of the United States and Japan s Satoshi Kodaira who were the only other PGA Tour rookies to collect wins On behalf of the PGA Tour our congratulations to Aaron Wise on being voted PGA Tour rookie of the year said PGA Tour commissioner Jay Monahan in a statement For Aaron to have won on the PGA Tour the Web com Tour and Mackenzie Tour before the age of 22 is remarkable and qualifying for the TOUR Championship as a rookie proved there is no stage too big for him The rookie of the year is voted by the PGA Tour s membership and is open to those who have played in at least 15 FedExCup events during the season |
WFC | Canada dollar to rally as global gloom lifts say strategists Reuters poll | By Fergal Smith
TORONTO Reuters The Canadian dollar will rally over coming months on a recovery in demand for riskier assets and as a solid domestic economy supports more interest rate hikes from a hawkish central bank according to a Reuters poll
The poll of more than 40 currency market strategists predicted the currency would climb to C 1 2850 to the greenback in three months from the C 1 3150 it was trading at on Wednesday
The currency is expected to climb to C 1 2600 in a year weaker than the C 1 2500 forecast in October s poll
The Canadian dollar declined 1 9 percent in October its worst monthly performance since February as optimism after a deal to revamp the North American Free Trade Agreement was overshadowed by a plunge in global stocks
Over the same month the U S dollar DXY climbed 2 percent against a basket of major currencies
The loonie is currently penalized by investors low risk appetite said Hendrix Vachon senior economist at Desjardins This situation is not expected to last as the economic fundamentals are still encouraging
Global equities have been pressured by a trade war between the world s two largest economies the United States and China
Canada runs a current account deficit and is a major exporter of commodities including oil so its economy could be hurt if the global flow of trade or capital slows
In October oil prices posted the worst monthly performance since mid 2016 amid worries about the outlook for demand and evidence of rising global crude supply
To make matters worse for Canada the price of its heavy crude traded at a record discount to U S oil during the month due to pipeline congestion The differential slumped to more than 50 before recovering some ground according to Shorcan Energy Brokers
Still the Bank of Canada was encouraged enough last week by prospects for the economy to lift its key interest rate to 1 75 percent It said the rate would need to rise further to a neutral stance of about 3 percent to achieve its inflation target and opened the door to a faster pace of tightening
Economists in a separate Reuters poll this week expected the central bank to raise interest rates three times next year
The Canadian dollar should attract support from a fairly hawkish Bank of Canada said Erik Nelson a currency strategist at Wells Fargo NYSE WFC Canadian growth remains above potential driven by solid domestic demand while the resolution of NAFTA uncertainty should help rebalance the economy toward investment rather than consumer spending
Canada s economy will continue to grow faster than its potential over the coming quarters as U S fiscal stimulus boosts demand for its exports a Reuters poll of economists showed last month
Still Canada s productivity and credit growth face a threat from a flattening yield curve as it makes it less appealing to invest in long term projects and less still if the Bank of Canada meets its goal of a 3 percent interest rate
Other stories from the global foreign exchange poll nL3N1XB3NZ |
WFC | Chart Of The Day Are Treasurys Eclipsing Wells Fargo s Rich Dividend | Wells Fargo s NYSE WFC 3 23 dividend has been one of the the most compelling reasons to own the stock given its string of scandals in recent years
But now that the 10 year Treasury note is yielding about the same investors looking for reliable fixed income may see the government bond as a much safer bet
As Friday s Q3 earnings report nears and with WFC shares currently trading 11 77 lower year to date it s decision time for investors In our opinion earnings have to be dramatically better than expected to overcome the loss of trust both consumers and investors have suffered over the past few years
But even if Wells Fargo outperforms investors would be wise to consider another equity with a similar dividend or perhaps a less risky asset such as the 10 year The 10 year note is right near Wells Fargo s yield so why risk capital on a falling stock when you can get the same income with virtually no risk
On Sept 10 the bank s stock price fell below its uptrend line from October 2016 for the second time since March 19 Friday the price crossed below the 200 DMA which has traced the neckline of a head and shoulders top A fall below the 50 level would trigger stop losses and tip the market balance to oversupply
Trading Strategies Short Position Setup
Conservative traders should wait for at least a 3 penetration and or three days in which the price was below the neckline preferably to include a Friday which demonstrates traders commitment to their positions Then they may wait for a return move to confirm resistance with at least one long red candle engulfing a preceding red or small candle of any color
Moderate traders may be satisfied with a 2 penetration and or two days with the price below the neckline to avoid a bear trap Then they may wait for a return move for a better entry but not necessarily for confirmation of the new trend
Aggressive traders may enter a short after a 1 penetration and or one day for the price to remain below the neckline |
EBAY | US Jobs Off To A Great Start To 2019 Sector ETF Winners | U S employers added 304 000 new jobs in January after a downwardly revised 222 000 in December The number breezed past market expectations of 165 000 There was also an upward revision in November jobs data from 176 000 to 196 000 Considering all revisions job gains have averaged over the past three months
The unemployment rate however increased to 4 last month from 3 9 in December and above market expectations of 3 9 This points to tumults created by the government shutdown Average hourly earnings rose by 3 cents to 27 56 Over the year average hourly earnings increased 3 2
Winning Sector ETFs
Against this backdrop investors can consider betting on ETFs that are the largest beneficiaries of the January jobs data report Below we have highlighted some of these that will likely see smooth trading in the days ahead
Leisure Hospitality
Job gains in the leisure hospitality industry were most prominent with 74 000 new vacancies being filled in January Within the industry job creation in food services and drinking places 37 000 and in amusements gambling and recreation 32 000 deserve special mention Over the year the industry added 410 000 jobs
Invesco Dynamic Food Beverage ETF and Casino ETF VanEck Vectors Gaming ETF may see some solid trading in the near term thanks to the January jobs report
Construction
Per tradingeconomics about 52 000 jobs were created in the construction sector in the month In the span of a year the sector has generated about 338 000 jobs Nonresidential 19 000 and residential 15 000 components of specialty trade contractors as well as heavy and civil engineering construction 10 000 and residential building 9 000 saw an uptick in job creation
Obviously such upbeat data makes us keep a close watch on Invesco Dynamic Building Construction ETF The underlying index of the fund picks building and construction stocks on the basis of factors like growth stock valuation and investment timeliness read
Healthcare
New job additions jumped by 42 000 in the sector in January wherein ambulatory health care services and hospitals added a respective 22 000 and 19 000 These two segments have been creating solid jobs for three months in a row The sector overall saw an annual increase of 368 000 jobs read
Transportation
There were 27 000 job additions in transportation and warehousing in January Within the industry warehousing and storage saw 15 000 job growth and couriers and messengers saw another 7 000 additions
Year over year employment in transportation and warehousing rose by 219 000 This puts the spotlight on iShares Transportation Average ETF and First Trust Nasdaq Transportation ETF
Retail
There were 21 000 job additions in retail trade in January Within the industry porting goods hobby book and music stores saw 17 000 job additions Retail trade employment increased by 26 000 over a year January jobs reports thus put VanEck Vectors Retail ETF V RTH and ProShares Online Retail ETF in focus read
Want key ETF info delivered straight to your inbox
Zacks free Fund Newsletter will brief you on top news and analysis as well as top performing ETFs each week |
WFC | Wells Fargo pays 65 million to settle cross sell fraud claims with New York | Reuters Wells Fargo NYSE WFC Co will pay 65 million to settle claims that it misled investors about its cross selling business strategy the New York Attorney General s office said on Monday A push by Wells Fargo to get existing customers to buy more of the bank s products known as cross selling was at the center of a fake customer accounts scandal that has dogged the bank for two years Wells Fargo failed to disclose to investors that the success of its cross selling was built on sales practice misconduct Underwood s office said The misconduct at Wells Fargo was widespread across the bank and at every level of management impacting both customers and investors who were misled New York Attorney General Barbara Underwood said in a statement The bank which has paid hundreds of millions of dollars in regulatory fines and settlements related to the scandal said in a statement it had previously accrued the penalty costs
Since the sales scandal came to light in 2016 Wells Fargo has overhauled management and is trying to regain trust including through an ad campaign saying that Wells Fargo was established in 1852 and re established in 2018 |
WFC | Wells Fargo declares 0 43 dividend adds to buyback | Wells Fargo NYSE WFC declares 0 43 share quarterly dividend in line with previous Forward yield 3 32 Payable Dec 1 for shareholders of record Nov 9 ex div Nov 8 In addition board of directors increased the company s authority to repurchase common stock by an additional 350 million shares See WFC Dividend Scorecard Yield Chart Dividend Growth |
WFC | Two Wells Fargo executives go on leave of absence amid sales scandal review | By Imani Moise Reuters Wells Fargo NYSE WFC Co said on Wednesday it put two executives on leave in connection with ongoing regulatory reviews into the bank s retail sales practices Chief Administration Officer Hope Hardison and Chief Auditor David Julian have begun leaves of absence and will no longer be members of the bank s operating committee the bank said The bank declined to comment on the reason for the moves which it announced in a press release Hardison is a 24 year veteran of Wells Fargo and assumed the CAO role in 2015 according to the company website Julian joined Wells through its merger with Wachovia Corp and has served as chief auditor since 2012 according to LinkedIn NYSE LNKD Wells Fargo has been coping with the fallout of a sales practice scandal since late 2016 when it was revealed that millions of fake accounts may have been opened in customers names by bankers facing lofty sales targets Since then the bank has been hit with penalties including a 1 billion fine and a cap on assets put in place by the Federal Reserve Earlier this week the bank settled for 65 million with the New York attorney general s office which alleged that the bank misled investors about its sales practices The fourth largest U S lender is still facing inquiries into its customer sales abuses by the Department of Justice the Securities and Exchange Commission and the Department of Labor according to Wells Fargo s most recent regulatory disclosure The bank is also facing several class action lawsuits from angry customers
We remain steadfast in our focus on making things right for customers and building a better Wells Fargo Chief Executive Officer Tim Sloan said in a statement on Wednesday |
WFC | Forex Dollar Hits More Than 1 Month High on Sterling Slump | Investing com The dollar rose to a more than one month high against its rivals Thursday shrugging off mostly bearish U S economic data as a slump in sterling supported sentiment
The U S dollar index which measures the greenback against a trade weighted basket of six major currencies rose by 0 32 to 96 49
The greenback remained on track to notch its second weekly gain in a row even as data showed weakness in the labor market and signs of slowing momentum in business spending ahead of the all important third quarter U S GDP data due Friday
The Commerce Department said on Wednesday core durable goods orders rose 0 1 last month missing economists forecast for a 0 5 rise
While the trends for orders are still firmly positive the indications about business spending were soft in the report as capital goods orders fell for the second straight month Wells Fargo NYSE WFC said There are signals that business capex is fading
The U S Department of Labor reported Thursday that initial jobless claims increased by 5 000 to a seasonally adjusted 215 000 for the week ended Oct 20 higher than economists forecast for a rise to 214 000
The soft patch for U S housing activity meanwhile eased somewhat after the National Association of Realtors pending home sales index rose 0 5 to 104 6 last month
The mostly downbeat economic data however did little to keep a lid on the greenback s advance following weakness in both the euro and sterling
GBP USD fell 0 5 to 1 2818 as the pair struggled to hold early session gains which had followed news that UK Prime Minister Theresa had received the backing from members of her Conservative party laying to rest at least temporarily a challenge to her leadership
EUR USD fell 0 30 to 1 1358 as European Central Bank President Mario Draghi said the bank would pursue its tightening policy despite lingering fears about the bloc s economic and political future
Direction for the single currency will likely be uncertain until a verdict is given on Italy s S P credit rating TD Securities said
USD CAD meanwhile rose 0 19 to C 1 1309 as the loonie gave up some of its gains from a day earlier when the Bank of Canada hiked rates and turned more hawkish on monetary policy dropping a reference to gradual in its statement
The yen meanwhile was shunned after risk appetite returned in the wake of a rally in global markets
USD JPY rose 0 33 to Y113 62 |
WFC | Wells Fargo says aware about issues with ATM and credit card transactions | Reuters Wells Fargo NYSE WFC Co on Thursday said it was aware of issues with its debit and credit card transactions
Wells Fargo is working on a resolution the bank said in a tweet apologizing for the problem |
WFC | Wells Fargo hit with lawsuit over robocalls to wrong numbers | By Dena Aubin Reuters A proposed class action lawsuit in San Francisco federal court accuses Wells Fargo NYSE WFC of making tens of thousands of automatically dialed or robo calls to cell phones without consumers consent Filed on Thursday on behalf of a nationwide class the lawsuit accuses Wells Fargo of calling wrong numbers with auto dialing equipment and failing to honor requests to stop The complaint seeks triple damages under the U S Telephone Consumer Protection Act or up to 1 500 for each call A spokesman for Wells Fargo could not immediately be reached for comment The lawsuit makes use of a recent 9th U S Circuit Court of Appeals ruling in Marks v Crunch San Diego a consumer class action against a gym operator That decision broadened the definition of automatically dialed calls which are barred by the TCPA if made to cell phones Previously autodialers were defined as devices that randomly generate phone numbers and call them But the 9th Circuit on Sept 20 ruled that the definition also includes equipment that automatically dials numbers stored on a list The 9th Circuit s ruling sparked an outcry from business groups which have been urging the Federal Communications Commissions to issue an interpretative rule restoring a narrower definition of an auto dialer In a comment letter to the FCC on Oct 24 the American Bankers Association said the 9th Circuit s ruling ignores Congress intent in restricting auto dialing when it passed the TCPA in 1991 Congress meant to ban mass calls to random numbers not calls to lists of a company s customers or similar stored numbers the ABA said Citing the 9th Circuit s decision Thursday s lawsuit said Wells Fargo s equipment meets the definition of an automatic dialing system because it automatically dials numbers from stored lists Wells Fargo often leaves prerecorded messages on cell phones which is also barred by the TCPA the lawsuit alleged The lawsuit was filed by Michigan resident Lisa Barnes who alleged that Wells Fargo began calling her cell phone in 2016 asking to speak to a Richard Loutman a man Barnes did not know Barnes was never a Wells Fargo customer and did not consent to be called the complaint said Barnes asked Wells to stop calling but the calls continued her lawsuit said The Federal Communications Commission has been reconsidering its rules on auto dialers since May when it issued a notice seeking comments The case is Barnes v Wells Fargo Bank U S District Court Northern District of California No 18 6520 |
WFC | This Bank Stock Just Broke Below Its 200 DMA Here s The Trade | Many of the leading bank stocks took a hit Wednesday Wells Fargo NYSE WFC in particular caught my eye trading lower by 1 29 to 56 09 a share It also broke its important 200 day moving average which is a negative position for the stock There are still many support levels still in play for WFC but this sign of weakness should lead to further downside in the coming weeks
Support To Watch
Traders and investors should note that the next key support area for the stock is around 52 This important level was defended in late April 2018 and will likely serve as major support when retested I ll be closely watching this price point for a long side trade in this banking giant |
WFC | EUR USD Euro s False Start | Before the announcement of the results of the Fed meeting investors are in no hurry to open medium term positions in the EUR USD
The EUR USD bulls tried to resume the attacks and re tested the psychologically important mark of 1 18 against the background of moderately hawkish comments by Mario Draghi However everything quickly fell into place and the main currency pair returned to its original positions Investors are well aware that the supply is on the side of the Fed Prior to the updated forecasts of the Federal Reserve and Jerome Powell s speech no one wants to get into trouble which increases the risks of short term consolidation of the euro in the range of 1 165 1 185
Looking at how often representatives of the European Central Bank do not hesitate to talk about the normalization of monetary policy there is a feeling that they are quite satisfied with the current levels of the EUR USD Member of the Governing Council and concurrently one of the main contenders for the post of ECB head Benoit Coeur and chief economist Peter Praet argue that the markets should pay attention to the speed of the monetary restriction and not its terms Head of the Bank of Austria Ewald Nowotny states that the eurozone economy is strong and it is necessary to raise rates earlier than investors currently expect Finally retiring Mario Draghi suggested that under the influence of a strong labor market and the acceleration of wages core inflation in 2020 could grow to 1 8 the ECB forecast is 1 7
Dynamics Of European inflation
Source Bloomberg
It is obvious that the shift in the timing of the ECB s rate hikes to an earlier period than September 2019 will become a serious bullish euro driver but one should also take into account the dollar s trumps According to the median forecast of Bloomberg experts the Fed will continue to tighten monetary policy once a quarter until June of next year after which it will take a pause in September The federal funds rate will reach 3 by the summer of 2019 although the previous poll had a figure of 2 75 If we take this scenario as a basic one then the strengthening of the trade conflict the fading of the fiscal stimulus effect and the proximity of the rate to neutral levels may slow down the normalization and against the background of its start in the euro area will help the EUR USD advance in the direction of 1 25
Dynamics Of Federal Funds Rate Source Bloomberg
Curiously Deutsche Bank DE DBKGn believes that the euro will become the main beneficiary of the trade war and will grow to 1 2 in the near future on the background of the substitution of Chinese imports to the US by the European imports In any case the escalation of the conflict has not given any support to the dollar yet The states are trying to conduct military operations on several fronts after Canada and China Washington began to exert pressure on Japan threatening with duties on the supply of cars Wells Fargo NYSE WFC notes that such drivers of the USD index growth as a divergence in monetary policy and in economic growth have exhausted themselves but the development of the policy of protectionism by Donald Trump increases the risks of currency wars and the US administration will clearly play down
Thus the medium and long term outlook for the greenback is by no means optimistic but if the Fed wants to support it on the short term horizon we will find out very soon |
WFC | Cryptocurrency Market Review Bitcoin Consolidates Despite Major News | Bitcoin and other top 50 altcoins were little changed in value Bitcoin in particular continued its consolidation below the Ichimoku Kinko Hyo s cloud on the daily chart inside a triangle chart pattern A break above or below the triangle or the thinning future Ichimoku cloud could confirm the direction of Bitcoin s value in October
In other news Bitfinex one of the leading crypto exchanges for active traders is reportedly now banking with HSBC through a private account of Global Trading Solutions Bitfinex used to bank with the US based Wells Fargo NYSE NYSE WFC but ended up suing it in April 2017 the bank blocked deposits to Bitfinex and disrupted its operations If Bitfinex can sustain its partnership with HSBC it may have a positive impact on the exchange and the crypto market as a whole
Among last week s other hot topics was the America brokerage firm TD Ameritrade who invested in ErisX a crypto related futures market that will integrate Ethereum Bitcoin Cash and Litecoin along with Bitcoin But even this news didn t do much to move the crypto prices
The week ahead may bring more volatility to the cryptocurrency market so plan your strategies in advance invest responsibly and subscribe for more updates
This article was originally published on Invest Diva |
EBAY | eBay Pops 8 As Activist Investor Gets Involved | Summary
eBay NASDAQ EBAY traded 8 higher on Tuesday morning after an activist investor floated the idea of splitting the company into smaller firms
Our analysis is that while the stock has made an important bottom there may be better opportunities to take a position in the near future
Elliott Management an investment manager that owns 4 of eBay recommended splitting the e commerce giant into smaller firms to maximize shareholder value Its Enhance eBay Plan includes spinning off ticket exchange StubHub online classified properties and other reforms
In a letter to eBay s board Elliot said Significant underperformance occurred despite strong end market performance As the broader internet universe has flourished especially e commerce peers eBay s stock has floundered Elliott believes its plan would double the share price
Our analysis of the market cycles for EBAY is that the stock is in the rising phase of its current cycle We see 36 as resistance with a pullback likely in the near term While the stock has been in a negative pattern indications are it has made an important bottom which was confirmed by today s breakaway gap As such we expect minor pullbacks and then higher prices in the spring summer
For more from Slim or to learn about cycle analysis check out the askSlim Market Week show every Friday on our YouTube channel |
EBAY | EBay EBAY Q4 Earnings And Revenues Top Estimates | EBay EBAY came out with quarterly earnings of 0 84 per share beating the Zacks Consensus Estimate of 0 68 per share This compares to earnings of 0 59 per share a year ago These figures are adjusted for non recurring items
This quarterly report represents an earnings surprise of 23 53 A quarter ago it was expected that this e commerce company would post earnings of 0 55 per share when it actually produced earnings of 0 56 delivering a surprise of 1 82
Over the last four quarters the company has surpassed consensus EPS estimates three times
EBay which belongs to the Zacks Internet Commerce industry posted revenues of 2 88 billion for the quarter ended December 2018 surpassing the Zacks Consensus Estimate by 0 47 This compares to year ago revenues of 2 61 billion The company has topped consensus revenue estimates two times over the last four quarters
The sustainability of the stock s immediate price movement based on the recently released numbers and future earnings expectations will mostly depend on management s commentary on the earnings call
EBay shares have added about 21 2 since the beginning of the year versus the S P 500 s gain of 5 5
What s Next for eBay
While eBay has outperformed the market so far this year the question that comes to investors minds is what s next for the stock
There are no easy answers to this key question but one reliable measure that can help investors address this is the company s earnings outlook Not only does this include current consensus earnings expectations for the coming quarter s but also how these expectations have changed lately
Empirical research shows a strong correlation between near term stock movements and trends in earnings estimate revisions Investors can track such revisions by themselves or rely on a tried and tested rating tool like the Zacks Rank which has an impressive track record of harnessing the power of earnings estimate revisions
Ahead of this earnings release the estimate revisions trend for eBay was mixed While the magnitude and direction of estimate revisions could change following the company s just released earnings report the current status translates into a Zacks Rank 3 Hold for the stock So the shares are expected to perform in line with the market in the near future You can see the complete list of today s Zacks 1 Rank Strong Buy stocks here
It will be interesting to see how estimates for the coming quarters and current fiscal year change in the days ahead The current consensus EPS estimate is 0 61 on 2 66 billion in revenues for the coming quarter and 2 59 on 11 17 billion in revenues for the current fiscal year
Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well In terms of the Zacks Industry Rank Internet Commerce is currently in the top 40 of the 250 plus Zacks industries Our research shows that the top 50 of the Zacks ranked industries outperform the bottom 50 by a factor of more than 2 to 1 |
WFC | Why Hedge Funds Will Stick With Ever Risky Short Volatility Trades | Bloomberg It s a familiar spectacle on Wall Street the short volatility complex takes a beating and prophets of doom warn money managers the strategy is running out of steam
But while assets in passive products that bet against equity price swings have shrunk to their smallest since 2013 and late cycle bears are sharpening their claws the trade isn t going to be pounded into submission
Market and technical forces practically guarantee hedge funds will keep calm and carry on setting the stage for the next wash out say volatility speculators
There are monetary conditions still supporting the trade said Yannis Couletsis director at volatility hedge fund Credence Capital Management Ltd As long as central banks take a gradual and incremental pace of deleveraging and their rhetoric continues to actually function as a volatility absorber the short vol carry will still make money
The VIX experienced its most violent shudder since February on Oct 11 on the heels of a two day 5 percent rout in the S P 500 Index That left short sellers holding the bag as the price of near term futures surged above those further out on the curve
Lincoln Edwards of Houndstooth Capital Management LLC a 9 million hedge fund in Austin Texas that reaped 6 000 percent in February s meltdown estimates the losses on some of those short futures positions to be around 420 million
But in relative terms the pain is limited
The breakout in the VIX this month is less extreme than the February tumult and fewer funds are leveraged to the hilt suggesting short sellers are sitting tight according to Tobias Hekster co chief investment officer at hedge fund True Partner Capital Their choking levels simply were not reached
The take away It s likely business as usual for the short vol trade and thus setting us up for the next hiccup somewhere down the road Hekster said
Pretty Premium
The classic version of the strategy depends on the shape of the futures curve and the tendency of implied volatility to be more elevated than its realized counterpart a dynamic some say is exacerbated by the tide of central bank liquidity
Sellers of volatility expose themselves to the prospect of unlimited losses in tail scenarios while the pain for option buyers is limited to the premium paid That asymmetry keeps the difference between future expectations of volatility and what actually comes to pass at a persistent spread all but guaranteeing short sellers make money except when the VIX suddenly surges as per moves seen last week
One key reason for the likely lack of lasting pain is the absence of the short volatility exchange traded products said to have exacerbated the hurt earlier this year
According to the now famous theory volatility related ETPs scrambling to rebalance their holdings snapped up VIX futures in the grip of February s meltdown effectively pushing up the price of the contracts and eventually the underlying index
The AUM of these products is a ghost of what it once was said Houndstooth s Edwards That s actually a really good thing for short volatility speculators since they re less likely to get squeezed like they did on February 5th
More to the point data suggests short sellers were sticking to their guns despite ominous signs like the inversion of the VIX futures curve Speculators were net short some 113 000 VIX futures contracts on Oct 9 four days after the curve inverted CFTC data show
Given the degree to which volatilities were depressed going into this there is no doubt in my mind that the volatility short trade was alive and kicking said Hekster
These investors have developed nerves of steel in recent years thanks to the frequency of outsized VIX spikes
Sudden bursts of volatility have become a more frequent phenomenon in the past few years Pravit Chintawongvanich equity derivatives strategist at Wells Fargo NYSE WFC Securities wrote in a note He points out that since 2007 there have been six such events compared with five in the preceding 50 years
Such bursts can be lethal for the short volatility punt unless traders have had the foresight to implement hedges In a twist that further feeds the volatility complex Large VIX moves create yet another opportunity to short the index on the way down
Regardless it is the investing strategy s bread and butter the tendency of longer dated futures to be more expensive than shorter dated contracts that will feed hedge funds and retail investors anew
Although large VIX spikes create the best opportunity to short volatility I still believe that over 70 percent of the short vol income comes from the futures curve roll down said Couletsis |
WFC | Wells Fargo to shift EU hub to Paris in Brexit plan | Reuters Wells Fargo Co N WFC said on Tuesday it had applied for an investment firm license in France as part of a Brexit strategy that will shift its servicing of European mainland customers out of London The San Francisco based bank whose purchase of a high profile location near the Bank of England two years ago was seen as a vote of confidence in the Brexit process said it would continue to service UK and non EU clients from London It said its new subsidiary based in Paris would provide capital markets and investment banking services for European and international customers who require access to the EU and the European Economic Area The company gave no indication whether the move would lead to job cuts in London or how many it would employ in Paris A spokesperson did not immediately provide details on how many employees Wells Fargo has in London With Brexit on the horizon Wells Fargo is committed to providing a transition which is as seamless as possible for its markets and investment banking customers said Alicia Reyes head of Wells Fargo Securities for Europe the Middle East and Africa The new Paris based unit will be called Wells Fargo Securities Europe S A French Prime Minister Edouard Philippe said in July that the country would ease financial regulations to EU minimums and introduce new tax incentives to make Paris a more attractive finance hub Paris is competing with the likes of Frankfurt Dublin and Luxembourg to win over finance jobs in the wake of Britain s departure from the EU next March The Paris Europlace financial sector lobby said in July that Paris was set to win 3 500 financial sector jobs leaving Britain due to Brexit HSBC L HSBA would make up the bulk with 1 000 jobs while French banks moving posts back to their base in Paris would add another 1 000 jobs The rest would come from a host of Wall Street banks and other financial firms the lobby had said Companies from across the EU use London for currency trading derivatives and managing investment funds Some EU policymakers want parts of these activities shifted to the continent after Brexit to avoid relying on what will then be a foreign financial center Wells Fargo said it will make more announcements on its Brexit strategy in the near future
This refiled version of the story fixes typo in the fourth paragraph |
EBAY | PayPal to acquire fraud prevention company Simility for 120 million | By Anna Irrera Reuters PayPal Holdings Inc O PYPL has agreed to acquire fraud prevention technology company Simility for 120 million in cash it said on Thursday Palo Alto California based Simility sells machine learning based technology to help online merchants spot fraudsters and improve risk management PayPal plans to make Simility s services available to its merchants following the close of the transaction which is expected by the end of the third quarter it said The acquisition underscores PayPal s broader ambition to offer small online merchants the same capabilities of bigger e commerce providers Bill Ready the company s chief operating officer said in an interview We are buying a company that provides great tools that merchants can use on their own Ready said For example merchants will be able to use Simility s technology to adjust their fraud controls based on what kind of products they sell The acquisition is the fourth deal announced by PayPal in little over a month as it continues to aggressively expand its business beyond just online payment processing Since separating from online marketplace eBay O EBAY in 2015 PayPal in San Jose California has sought to transform itself via partnerships and acquisitions from mostly processing online transactions for its parent company to offering a suite of digital financial services These range from lending to small businesses to facilitating money transfers between merchants and customers In May it said it had agreed to acquire Swedish payments company iZettle for 2 2 billion in its largest ever acquisition nL3N1SO5IE This week it announced an agreement to acquire Hyperwallet Systems Inc a company that helps online individual and small business sellers accept payments while earlier this month it revealed plans to buy prediction platform Jetlore The Simility deal comes as the threat of fraud for e commerce companies continues to grow as more business moves online and fraudsters refine their techniques The rate of e commerce fraud in the United States grew more than 30 percent in 2017 from a year earlier according to a study by credit bureau Experian Plc L EXPN Simility s services will benefit from the ability to draw upon PayPal s extensive data set on fraud he added
We have one of the largest data sets about how online fraud happens Ready said |
EBAY | Report EBay cuts hundreds of workers | EBay NASDAQ EBAY has cut hundreds of workers from its rolls today Bloomberg is reporting The company has let go a low single digit percentage of a global workforce that runs about 14 100 Shares fell 2 1 today and reached their lowest point since December They tagged a 52 week low of 33 95 on Nov 29 Now read |
EBAY | Will EBay EBAY Beat Estimates Again In Its Next Earnings Report | Looking for a stock that has been consistently beating earnings estimates and might be well positioned to keep the streak alive in its next quarterly report EBay EBAY which belongs to the Zacks Internet Commerce industry could be a great candidate to consider
This e commerce company has an established record of topping earnings estimates especially when looking at the previous two reports The company boasts an average surprise for the past two quarters of 2 87
For the last reported quarter eBay came out with earnings of 0 56 per share versus the Zacks Consensus Estimate of 0 55 per share representing a surprise of 1 82 For the previous quarter the company was expected to post earnings of 0 51 per share and it actually produced earnings of 0 53 per share delivering a surprise of 3 92
Price and EPS Surprise
Thanks in part to this history there has been a favorable change in earnings estimates for eBay lately In fact the Zacks Earnings ESP Expected Surprise Prediction for the stock is positive which is a great indicator of an earnings beat particularly when combined with its solid Zacks Rank
Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank 3 Hold or better produce a positive surprise nearly 70 of the time In other words if you have 10 stocks with this combination the number of stocks that beat the consensus estimate could be as high as seven
The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change The idea here is that analysts revising their estimates right before an earnings release have the latest information which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier
EBay has an Earnings ESP of 1 47 at the moment suggesting that analysts have grown bullish on its near term earnings potential When you combine this positive Earnings ESP with the stock s Zacks Rank 3 Hold it shows that another beat is possibly around the corner The company s next earnings report is expected to be released on January 30 2019
When the Earnings ESP comes up negative investors should note that this will reduce the predictive power of the metric But a negative value is not indicative of a stock s earnings miss
Many companies end up beating the consensus EPS estimate but that may not be the sole basis for their stocks moving higher On the other hand some stocks may hold their ground even if they end up missing the consensus estimate
Because of this it s really important to check a company s Earnings ESP ahead of its quarterly release to increase the odds of success Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they ve reported |
WFC | In crackdown U S FDA seeks details on new electronic cigarettes | By Chris Kirkham LOS ANGELES Reuters Faced with a proliferation of new electronic cigarettes and a sharp rise in teen vaping the U S Food and Drug Administration on Friday sent letters to 21 electronic cigarette manufacturers seeking information to assess whether the products are being marketed illegally An FDA rule banned the sale of new e cigarette products after August 2016 without regulatory approval In September Reuters reported that startups and big tobacco firms launched more than a dozen new high nicotine e cigarette products mimicking the popular Juul devices after the FDA imposed the deadline The agency on Friday sent letters to companies including Reynolds American Inc NYSE RAI a unit of British American Tobacco LON BATS Plc which makes the Vuse Alto device asking for evidence that the products were on the market before the August 2016 cutoff FDA Commissioner Scott Gottlieb said the agency will not allow the proliferation of e cigarettes being sold without proper approval The agency also sent letters to Fontem Ventures a unit of Imperial Brands LON IMB Plc seeking information about its myblu e cigarettes as well as smaller companies including Kandypens Myle Vapor and VGOD Shares of British American Tobacco on Friday were down 3 9 percent and Imperial Brands fell 6 percent in London A spokesman for British American Tobacco said the company will provide to the FDA information to show it is in compliance with the rule He said the company notified the FDA in May that the product was a repackaged and re branded version of a product that was on the market before August 2016 A spokesman for Imperial Brands said the myblu products are in compliance with FDA rules adding that the company will provide the requested documentation soon Representatives for the other companies did not respond to requests for comment If the FDA determines the e cigarettes were introduced after the August 2016 deadline companies could face fines or have their products seized from store shelves Gottlieb said the agency was concerned about sweet flavors in several of the products which he said are one of the principal drivers of the youth appeal of e cigarettes POPULAR AMONG TEENS The FDA has faced increased pressure to act as the sleek Juul e cigarettes have surged in popularity among U S teenagers Juul Labs Inc s share of the e cigarette market rose to more than 70 percent now up from 13 6 percent in early 2017 according to a Wells Fargo NYSE WFC analysis of Nielsen retail data that does not include online sales Juul sales grew from 2 2 million devices sold in 2016 to 16 2 million devices last year according to the U S Centers for Disease Control and Prevention Many high schools have resorted to locking bathrooms jokingly called Juul rooms by students The Juul design mimics a flash drive with plug in cartridges of concentrated nicotine juice It is far more compact than earlier vaping devices and produces less vapor making it easy to use without being detected an attribute some health advocates say attracts teenagers Juul was on the market before the August 2016 FDA deadline but other companies have introduced new copycat devices after the cutoff date without regulatory consequences Anti smoking advocates including the Campaign for Tobacco Free Kids complained about the Juul lookalikes in an August letter to the FDA saying the companies that had evaded the review process
The FDA has recently cracked down on what it calls an epidemic of youth e cigarette use threatening last month to ban Juul and four other leading e cigarette products unless their makers take steps to prevent use by minors |
WFC | Sketchers More Pain to Come | Skechers NYSE SKX traded 27 lower Friday morning after posting earnings below estimates and lowered guidance
The company reported earnings per share of 0 29 and total revenue of 1 1 billion compared to analyst expectations of 0 41 and 1 1 billion As well Skechers revised its projections for Q3 earnings per share to 0 50 0 55 and revenue to 1 20 1 22 billion below estimates of 0 68 and 1 26 billion
Analysts including Wells Fargo NYSE WFC and Susquehanna downgraded the stock and lowered their price targets to 24 and 26 respectively Meanwhile the stock posted a new 52 week low today
In analyzing the SKX market cycles we can see that it has fallen below the price at which it started it current cycle Having happened early in the cycle this indicates the stock has plenty of time to follow through on a possible move lower In fact our new target zone derived from Fibonacci extensions is below 22
For more from Slim or to learn about cycle analysis check out the askSlim Market Week show every Friday on our YouTube channel |
EBAY | eBay could end up with 5 percent stake in Dutch fintech firm Adyen report | AMSTERDAM Reuters eBay Inc NASDAQ EBAY could end up with a stake of up to 5 percent in Adyen as part of a deal the two companies agreed in January that will see the Dutch fintech company become eBay s primary payment processor a Dutch newspaper reported on Monday Warrants will be given to eBay in four tranches on the condition that the auction site routes a substantial portion of its payments via Adyen the Het Financieele Dagblad newspaper reported citing sources familiar with the matter A spokesman for Adyen declined to comment on the report eBay could not immediately be reached for comment Adyen this month plans to sell a 15 percent stake in an initial public offering in Amsterdam expected to value the company at 7 billion to 11 billion Shares in eBay rose by 15 percent on Feb 1 after it announced the Adyen deal which it said would add 500 million to operating profit when it goes into effect in mid 2020 Shares in eBay s former in house service PayPal which eBay spun off three years ago fell 8 percent
Adyen is due to publish its prospectus on Tuesday with listing to follow at mid month |
WFC | Wells Fargo touts good deeds to get back in lawmakers good graces | By Imani Moise and Pete Schroeder WASHINGTON Reuters Tired of being cast as the poster child for big banks behaving badly Wells Fargo NYSE WFC Co has been expanding its presence in the nation s capital to convince lawmakers it has changed and talking up its charitable work in their districts In the past the bank s lobbying efforts had been modest but over the past 18 months Wells Fargo has added more than 15 people to its Washington team tripling its size and is still hiring The bank has also contracted big name firms including Ogilvy and Federal Street Strategies whose principals previously worked for powerful lawmakers financial regulators or President Donald Trump according to interviews and filings reviewed by Reuters Wells Fargo has also been highlighting millions of dollars spent on programs dedicated to homelessness housing for veterans and financial literacy in key lawmakers districts to win back their favor bank representatives said We have a lot of projects in a lot of communities that we are proud of and we do have those conversations with elected officials David Moskowitz head of government relations and public policy at the fourth largest U S lender told Reuters Our plan is to engage with virtually everyone on Capitol Hill on both sides of the aisle Moskowitz said he expected his team to meet with important government officials or staff almost every day Wells Fargo launched its charm offensive to limit the blowback from a sales scandal that erupted in September 2016 with revelations that employees opened potentially millions of phony accounts in customers names without their permission The bank has disclosed other problems since then including enrolling hundreds of thousands of customers in costly products such as auto insurance that they did not need or want In an unprecedented move in February the U S Federal Reserve imposed an asset cap on Wells Fargo In April two U S regulators jointly fined the bank 1 billion for mistreating auto borrowers Authorities including the Department of Justice the Securities and Exchange Commission and the Department of Labor are still conducting their own probes WHIPPING BOY Each negative headline about Wells Fargo extends how long the bank will remain in the regulatory doghouse said Isaac Boltansky director of policy research at Washington based Compass Point Research Trading There s a belief among some policymakers that Wells Fargo wants to right the ship and that it will take time to do so he said But in the meantime they will remain the rhetorical whipping boy for lingering populist anger The scandal related fallout has started to hit Wells Fargo s profits as it needs to work harder to win new customers and additional marketing costs keep expenses high In the first half of the year Wells Fargo earned 10 3 billion 10 percent less than a year earlier Its full year profits before taxes are expected to be 5 percent lower according to Refinitiv The bank s Washington team is trying to shift the conversation to what the bank is doing now for communities and away from the misdeeds of the past Success could mean fewer negative headlines and a looser regulatory leash In interviews Wells Fargo representatives said they had been telling lawmakers what the bank is doing to remedy customer abuses and prevent them from happening again They also offer up the bank s expertise on lending and economic trends tout the number of people Wells Fargo employs in lawmakers districts and outline philanthropic programs that appeal to them For instance Wells Fargo said it has provided 11 3 million in down payment help to homeowners in Los Angeles which is represented in part by Democrat Maxine Waters Waters is positioned to chair the House Financial Services Committee if Democrats take control of that chamber in the Nov 6 mid term election and has been one of Wells Fargo s harshest critics in Congress She has said expanding access to affordable housing would be a top priority as committee chair Wells also says it has donated over 10 million to various nonprofits in Waters district over the last two years Wells Fargo Chief Executive Officer Tim Sloan has asked Waters for a meeting her representative said and bank representatives met with her staff in July She looks forward to meeting with him once their schedules align said Charla Ouertatani staff director for Waters on the House Financial Services Committee The committee plans to revisit Wells Fargo s treatment of customers and its compliance with consumer protection laws after the election she said Wells Fargo also donated 3 3 million last year to nonprofits and schools around Baltimore represented by Democrat Elijah Cummings tipped to chair the House Oversight Committee if his party wins There are many exceptional organizations that are transforming lives in Baltimore and throughout Maryland with limited resources Cummings said in a statement Whenever Wells Fargo or any company chooses to assist their efforts I applaud that decision If Democrats take control of the House Waters and Cummings would enjoy broad authority to examine Wells s business operations as well as demand bank executives testify on past wrongdoing if they saw fit Wells Fargo said the bank had also donated 4 5 million to nonprofits across Iowa in 2017 a fact it highlights to the state s mostly Republican lawmakers including Senator Chuck Grassley who chairs the powerful Senate Judiciary Committee LONG PATH In total Wells Fargo has pledged to give away 400 million to charitable causes in 2018 and 2 percent of after tax profits in following years That could position it as the top corporate cash donor in the United States according to the Chronicle of Philanthropy which tracks corporate giving The bank was the top donor among financial firms in 2017 and the second largest among corporations Graphic In 2015 prior to the sales scandal the bank donated 281 million though Wells credits tax cuts implemented at the start of this year for part of this year s increase Even with those good deeds in hand Wells Fargo will probably remain in the political crosshairs for some time according to analysts and congressional staff On Oct 4 Senate Banking Committee Democrats called for Sloan and Wells Fargo Chair Elizabeth Duke to testify about widespread and persistent failures at the bank Wells Fargo s plan to cut its workforce by up to 10 percent is also attracting ire from Democrats The bank has to make up ground with regulators too Last week Comptroller of the Currency Joseph Otting told lawmakers he was not comfortable with the bank s efforts to make things right with 600 000 auto loan borrowers During the hearing Hawaii Democrat Brian Schatz characterized the bank as beyond repair Wells s efforts have been noticed but the reception has been mixed according to members of Congress and staff interviewed by Reuters While some say the bank is taking the right steps on a long path to a repaired reputation distrust of banks stills runs deep particularly among Democrats Some lawmakers such as Senator Elizabeth Warren have said the bank is still not doing enough to right past wrongs Representative Bill Huizenga a Michigan Republican who is a senior member of the House Financial Services Committee said Wells Fargo has a lot more work to do before lawmakers will take its efforts seriously
Trust is a tricky thing he told Reuters And it s a lot easier to lose it than it is to gain it |
WFC | Daily Market Report 12 07 2018 | Commodities
We start with the US energy information administration which last night reported the largest drop in production in 3 years 12 million barrels The news came just after news that Libya was ready to resume production after both Canada and Iranian output expectations were revised down The result a 4 plunge in prices from 74 The post EIA recovery hasn t done much for prices though
US
Equity markets throughout Europe and the US were down yesterday as the Trump administration prepares to levy that extra 200 billion in tariffs against China In other news producer inflation yesterday climbed 3 4 year on year but wholesale inventories came in below expectations at 0 6 And the Bank of Canada surprisingly increased interest rates to 1 5 despite NAFTA tensions 76 of Canadian goods make their way to the US that s about a third of the nation s GDP Still wages are growing nicely and the Loonie s support at 75 80 is definitely higher than last month s Now we need to hope that increased interest won t hurt the local homes market
Asia
Last night s foreign investments in Japan grew by 74 bn yen that s after investors pulled out of Japanese stocks in June to the tune of 300 bn Still the yen IS struggling after Tuesday s machinery orders which fell 4 month on month And China has said it would once again retaliate to Trump s tariffs but the US doesn t export that much to China so the question remains how Clearly Europe stands to lose more from this that Asia as equities are showing ASIAN indexes on the other hand ended this morning with excellent gains 2 9 in Shezhen and 2 2 in Shanghai
Europe
The UK last night posted an impressive 2 increase in house prices for June that s up from May s 3 contraction Meanwhile the pound is looking for support at 1 32 40 as it tries to recover from its 3 month drop against the dollar and the FTSE lost another percent point 30 as markets closed last night Other European indexes didn t fare much better the dax and CAC 40 down by a percent and a half
Shares
Tomorrow we have quarterly earnings reports from JP Morgan Citi and Wells Fargo NYSE WFC In Q1 they all showed major gains and analysts are expecting a repeat for Q2
Events
Today we ve got industrial production still coming from the EU at 9 GMT and jobless claims from the US at noon and a half Canada s housing prices will be in at the same time with exports and imports for China coming overnight |
EBAY | PayPal Stock Entering High Risk Territory | PayPal Holdings NASDAQ PYPL was spun off from eBay NASDAQ EBAY in 2015 and judging from its share price three years later it has been a tremendous investment PayPal stock fell to 30 a share in August 2015 By September 2018 it was trading above the 93 mark Following last month s dip to 74 66 the stock is on the rise again currently in the vicinity of 90
PayPal stock s 200 total return in three years translates into 44 2 compounded annually This is something even the best money managers out there can only dream of What bothers us that people tend to extrapolate the recent past into the distant future This creates the belief that what has worked before will continue to work Unfortunately all the stock market crashes in history suggest otherwise
So is PayPal stock still a good investment Is it time to join the bulls or get defensive Let s see if the Elliott Wave Principle can help us answer these questions
The daily chart reveals the structure of PYPL stock s bull market The rally from 30 to almost 94 can be seen as the first three waves labeled I II III of a five wave impulse The sub waves of wave III and the sub waves of wave 3 of III are also clearly visible
This means the recent dip to under 75 in October stands for wave IV down and wave V up is now in progress Since wave V is supposed to exceed the top of wave III it follows that 100 a share is within the bulls reach in the short term
Danger Lurking Ahead for PayPal stock investors
On the other hand the Elliott Wave theory states that we can expect a three wave correction in the opposite direction as soon as wave V is over The bearish RSI divergence between waves 3 and 5 of III also indicate PayPal stock is losing momentum
Besides PayPal s 2018 guidance is for EPS of 1 69 which gives the stock a forward price to earnings ratio of almost 53 This is a very high ratio which means a lot of optimism is already priced in PayPal s valuation And where optimism is strong disappointment lurks
In conclusion PayPal stock seems determined to reach 100 a share Instead of joining the bulls though investors should proceed with caution We believe a 30 decline to the support near 70 is just around the corner for the online payments provider
Original post |
EBAY | EBay EBAY Gains But Lags Market What You Should Know | eBay EBAY closed at 28 17 in the latest trading session marking a 1 move from the prior day This change lagged the S P 500 s 1 06 gain on the day Elsewhere the Dow gained 0 83 while the tech heavy Nasdaq added 1 72
Coming into today shares of the e commerce company had lost 12 9 in the past month In that same time the Retail Wholesale sector lost 1 06 while the S P 500 lost 2 09
Wall Street will be looking for positivity from EBAY as it approaches its next earnings report date This is expected to be January 30 2019 The company is expected to report EPS of 0 68 up 15 25 from the prior year quarter Meanwhile the Zacks Consensus Estimate for revenue is projecting net sales of 2 87 billion up 9 81 from the year ago period
For the full year our Zacks Consensus Estimates are projecting earnings of 2 30 per share and revenue of 10 74 billion which would represent changes of 15 and 12 24 respectively from the prior year
Any recent changes to analyst estimates for EBAY should also be noted by investors Recent revisions tend to reflect the latest near term business trends As a result we can interpret positive estimate revisions as a good sign for the company s business outlook
Based on our research we believe these estimate revisions are directly related to near team stock moves We developed the Zacks Rank to capitalize on this phenomenon Our system takes these estimate changes into account and delivers a clear actionable rating model
The Zacks Rank system which ranges from 1 Strong Buy to 5 Strong Sell has an impressive outside audited track record of outperformance with 1 stocks generating an average annual return of 25 since 1988 The Zacks Consensus EPS estimate has moved 0 33 higher within the past month EBAY is holding a Zacks Rank of 3 Hold right now
Looking at its valuation EBAY is holding a Forward P E ratio of 12 11 Its industry sports an average Forward P E of 25 81 so we one might conclude that EBAY is trading at a discount comparatively
It is also worth noting that EBAY currently has a PEG ratio of 1 26 This popular metric is similar to the widely known P E ratio with the difference being that the PEG ratio also takes into account the company s expected earnings growth rate EBAY s industry had an average PEG ratio of 2 2 as of yesterday s close
The Internet Commerce industry is part of the Retail Wholesale sector This industry currently has a Zacks Industry Rank of 169 which puts it in the bottom 34 of all 250 industries
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors Our research shows that the top 50 rated industries outperform the bottom half by a factor of 2 to 1
Be sure to follow all of these stock moving metrics and many more on Zacks com |
EBAY | Why Is Paypal PYPL Up 9 8 Since Last Earnings Report | It has been about a month since the last earnings report for Paypal PYPL Shares have added about 9 8 in that time frame outperforming the S P 500
Will the recent positive trend continue leading up to its next earnings release or is Paypal due for a pullback Before we dive into how investors and analysts have reacted as of late let s take a quick look at its most recent earnings report in order to get a better handle on the important drivers PayPal s Earnings Revenues Beat Q3 EstimatesPayPal Holdings reported non GAAP earnings of 58 cents per share in the third quarter of 2018 which surpassed the Zacks Consensus Estimate by 4 cents The figure was in line with the last reported quarter s earnings but increased 26 1 on a year over year basis Net revenues declined 4 7 sequentially but increased 14 year over year to 3 68 billion beating the Zacks Consensus Estimate of 3 66 billion The year over year growth in top line can be attributed to expanding customer engagement on PayPal s platform which significantly boosted net new active accounts in the third quarter Further robust performance of Venmo One Touch and Choice drove the results Moreover the company s strategic partnerships remained positive throughout the quarter However sale of the U S consumer credit receivables portfolio to Synchrony negatively impacted revenues Without the impact of the same revenues would have exhibited growth of 21 Top Line in DetailBy Type Transaction revenues came in at 3 34 billion 90 8 of net revenues up 17 from the year ago quarter The product diversification strategy of PayPal aided the same across all its operative geographies Other value added services generated 340 million of revenues accounting for 9 2 of net revenues decreasing 10 8 year over year This was primarily due to the sale of its U S consumer credit receivables portfolio to Synchrony By Geography Revenues from the United States came in at 1 96 billion 53 3 of net revenues surging 13 on a year over year basis International revenues were 1 72 billion 46 7 of revenues increasing 15 from the prior year quarter Quarter in DetailPayPal s strategic partnerships expanding product services portfolio along with strengthening presence in the global market led to massive increase in total payment volume TPV Moreover strong Venmo monetization efforts of the company remained positive throughout the quarter It recorded 17 growth in the number of Venmo users who have actively participated in monetization activity in the quarter compared with the last reported quarter Further PayPal s monthly active user base supported by Pay with Venmo efforts expanded significantly in September growing 185 from August Additionally the company s partnership with Uber boosted the adoption rate of Venmo across Uber and Uber Eats platform Also Venmo cart contributed significantly to the growth of monthly active users of the company Additionally the company s solid initiatives toward enhancement of Choice resulted in its growing adoption worldwide Further PayPal completed the buyout of iZettle This will expand omnichannel business in the global market Additionally the company announced the partnership with Ita Unibanco Holding SA This will allow PayPal to gain traction among the bank s customers by offering them services Key Metrics to ConsiderSupported by these endeavors the company recorded 15 4 year over year growth in total active accounts by the addition of 9 1 million net new active accounts during the reported quarter The total number of active accounts was 254 million in the quarter beating the Zacks Consensus Estimate of 251 million Additionally the total number of payment transactions came in at 2 46 billion up 27 on a year over year basis The figure topped the Zacks Consensus Estimate of 2 43 billion Further the company s payment transactions per active user were 36 5 million which increased 9 6 from the year ago quarter The figure lagged the Zacks Consensus Estimate of 36 6 million TPV came in at 143 billion in the third quarter exhibiting 24 1 and 25 year over year growth on spot rate and currency neutral basis respectively However the figure missed the Zacks Consensus Estimate of 145 03 billion Nevertheless strong performance of Venmo which accounted for 17 billion of TPV surging 78 on a year over year basis during the reported quarter Further PayPal processed 57 billion in mobile payment volume up 45 year over year accounting for 40 of TPV Moreover the company benefited from the increasing use of internet and mobile The company recorded 112 million customers and 10 4 million merchants using One Touch in the third quarter Also payment volume on P2P platform was 36 billion up 50 from the year ago quarter accounting for 25 of TPV Additionally merchant services volume was 127 billion up 28 year over year eBay NASDAQ EBAY volume increased 3 from the year ago quarter accounting for 11 of TPV Operating DetailsNon GAAP operating margin came in at 21 4 which expanded 150 basis points bps on a year over year basis and 10 bps sequentially Further non GAAP net income was 694 million up 23 9 on a year over year basis but declined 1 3 sequentially Adjusted operating expenses were 3 19 billion in the third quarter climbing 13 1 from the prior year quarter but declining 2 7 on a sequential basis Balance Sheet Cash FlowAs of Sep 30 2018 cash equivalents and investments came in at 10 5 billion up from 6 3 billion on Jun 30 2018 PayPal generated free cash flow of 4 45 billion during the third quarter compared with the negative figure of 170 million in the last reported quarter GuidanceFor fourth quarter 2018 PayPal expects revenues between 4 19 billion and 4 27 billion growing in the range of 13 15 on both current spot rate and FX neutral basis Non GAAP earnings are anticipated in the range of 65 67 cents per diluted share The company also projects stock based compensation expense and related payroll taxes between 210 million and 230 million For 2018 PayPal expects revenues between 15 42 billion and 15 50 billion growing at 18 19 at current spot rates and 17 18 on an FX neutral basis Further non GAAP earnings are expected in the range of 2 38 2 40 per share
How Have Estimates Been Moving Since Then
In the past month investors have witnessed an upward trend in fresh estimates The consensus estimate has shifted 5 2 due to these changes
VGM Scores
Currently Paypal has a strong Growth Score of A though it is lagging a bit on the Momentum Score front with a B However the stock was allocated a grade of D on the value side putting it in the bottom 40 for this investment strategy
Overall the stock has an aggregate VGM Score of B If you aren t focused on one strategy this score is the one you should be interested in
Outlook
Estimates have been trending upward for the stock and the magnitude of these revisions looks promising It comes with little surprise Paypal has a Zacks Rank 2 Buy We expect an above average return from the stock in the next few months |
EBAY | EBay EBAY Outpaces Stock Market Gains What You Should Know | In the latest trading session eBay EBAY closed at 28 34 marking a 0 64 move from the previous day This move outpaced the S P 500 s daily gain of 0 3 At the same time the Dow 0 and the tech heavy Nasdaq gained 0 92
Prior to today s trading shares of the e commerce company had gained 3 85 over the past month This has outpaced the Retail Wholesale sector s loss of 3 96 and the S P 500 s loss of 4 06 in that time
Wall Street will be looking for positivity from EBAY as it approaches its next earnings report date This is expected to be January 30 2019 In that report analysts expect EBAY to post earnings of 0 68 per share This would mark year over year growth of 15 25 Our most recent consensus estimate is calling for quarterly revenue of 2 87 billion up 9 81 from the year ago period
For the full year our Zacks Consensus Estimates are projecting earnings of 2 30 per share and revenue of 10 74 billion which would represent changes of 15 and 12 24 respectively from the prior year
Investors might also notice recent changes to analyst estimates for EBAY Recent revisions tend to reflect the latest near term business trends With this in mind we can consider positive estimate revisions a sign of optimism about the company s business outlook
Research indicates that these estimate revisions are directly correlated with near term share price momentum To benefit from this we have developed the Zacks Rank a proprietary model which takes these estimate changes into account and provides an actionable rating system
The Zacks Rank system which ranges from 1 Strong Buy to 5 Strong Sell has an impressive outside audited track record of outperformance with 1 stocks generating an average annual return of 25 since 1988 Over the past month the Zacks Consensus EPS estimate has moved 0 38 higher EBAY is currently a Zacks Rank 3 Hold
In terms of valuation EBAY is currently trading at a Forward P E ratio of 12 31 Its industry sports an average Forward P E of 26 so we one might conclude that EBAY is trading at a discount comparatively
Meanwhile EBAY s PEG ratio is currently 1 28 This popular metric is similar to the widely known P E ratio with the difference being that the PEG ratio also takes into account the company s expected earnings growth rate The Internet Commerce industry currently had an average PEG ratio of 2 02 as of yesterday s close
The Internet Commerce industry is part of the Retail Wholesale sector This industry currently has a Zacks Industry Rank of 148 which puts it in the bottom 42 of all 250 industries
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors Our research shows that the top 50 rated industries outperform the bottom half by a factor of 2 to 1
You can find more information on all of these metrics and much more on Zacks com |
WFC | Wells Fargo confident on Five Below | Wells Fargo NYSE WFC walks away from a meeting with Five Below FIVE 3 8 management impressed with the retailer s outlook The company s tone on its top line prospects especially around holiday was clearly positive It sees rising retail cost pressures associated with issues like wages and freight as manageable and sounds confident in its ability to continue to achieve its goal of 20 annual earnings growth through 2020 reads the WF update On the topic of tariffs Five Below reminded that only 15 of its sales would be impacted based on the current target list and that it plans to work with vendors raise prices and geographically shift sourcing to mitigate the issue Wells keeps an Outperform rating on Five Below due to its high expectations for the remainder of the year |
WFC | Deutsche Bank Wealth Management names two managing directors | Reuters Asset management company Deutsche Bank DE DBKGn Wealth Management named Wendy McMillan and Richard Aguiar as managing director and private banker McMillan and Aguiar will be based in San Francisco and Los Angeles respectively the company said in a statement on Wednesday Prior to this McMillan was managing director in the investment solutions group at Wells Fargo NYSE WFC Securities Llc while Aguiar joins from U S Trust where he was senior relationship manager |
WFC | Brazil s Far Right Candidate Jair Bolsonaro Is Having a Bad Day | Bloomberg Brazil s far right presidential candidate Jair Bolsonaro is not having a good day A key adviser is under investigation the market is off and a member of Pink Floyd called him a neo fascist
After more than a week of optimism over the rising prospects that Bolsonaro could win the presidency markets have swung against the former paratrooper The Bovespa stock index fell over 2 percent and the real lost more than 1 percent as investors re evaluated the extent of his pro market stance and prosecutors probed his key adviser Paulo Guedes
Brazilian assets had surged after Bolsonaro performed strongly in the first round vote on Sunday but sank on Wednesday as investors chewed over an interview he gave to local media In it he nixed the chances of getting pension reform approved this year and limited the scope of privatization in state run oil and energy companies In recent days there have been disjointed messages from his campaign team on the urgency of reforms further raising investor doubts
Bolsonaro signaled he would not be willing to vote for a version of pension reform proposed by current President Michel Temer a possible sign that a reform push under Bolsonaro may not be as strong as markets hope Wells Fargo NYSE WFC strategists Erik Nelson and Nick Bennenbroek wrote in a report
Analysts consider the pension reform crucial to manage the country s rising levels of public debt If the current rules remain in place Brazil would end up spending 23 percent of its GDP on pensions by 2060 according to finance ministry data from earlier this year Failure to approve the bill could also contribute to a further downgrade of the country s sovereign credit rating government officials have warned
In the TV interview on Tuesday night Bolsonaro also ruled out privatizing Brazilian state firms that generate electricity and said that he wants to keep the core of Petrobras under government control Shares in the oil company fell by as much as 4 4 percent on Wednesday while Eletrobras fell by as much as 14 9 percent
Guru Investigated
Much of investors enthusiasm for Bolsonaro is because of his economic adviser Guedes a University of Chicago trained economist The front runner in the presidential race has repeatedly admitted his ignorance on economics and stated he plans to outsource decision making in that area to Guedes
So the news that the public prosecutor s office in Brasilia was investigating him over alleged links to pension fund fraud added to investor nervousness
It is not good news said Tania Escobedo a strategist at RBC Capital Markets in New York But I don t see it having a sustained impact unless it escalates quickly |
WFC | SeaSpine Holdings readies stock offering | SeaSpine Holdings NASDAQ SPNE commenced an underwritten public offering of shares of its common stock Underwriters have a 30 day option to purchase up to an additional 15 of the shares of common stock offered in the public offering The offering is subject to market conditions and there can be no assurance as to whether or when the offering may be completed or as to the actual size or terms of the offering Net proceeds will be used to repay all of its outstanding borrowings under the Company s credit facility with Wells Fargo NYSE WFC Bank National Association and for general corporate purposes including general and administrative expenses capital expenditures and general working capital purposes Shares 5 3 Press ReleaseNow read |
EBAY | Squaring The Circle On Square Inc Is Possible | You don t need to be a mathematician to be able to calculate Square Inc s NYSE SQ valuation You do need to circle back on your assumptions about whether PayPal Holdings Inc NASDAQ PYPL provides a good point of comparison When Square is held up next to PayPal it shows that though their business models may differ in some ways they give a good reference It then points SQ likely undervalued relative to PYPL However PYPL itself is overvalued
A PayPal ComparisonIt s been proposed that PayPal offers a good point of comparison for Square They both operate as payment service providers that allow businesses to accept payments SQ hit the scene with their easy to use the dongle that turned your phone into a payment processor PYPL operates almost exclusively online In fact for years they remained unchallenged until startups like Stripe decided to disrupt their business model
Where the two differ come in where they operate Square firmly sits in the real world while PayPal lives in the digital These trends are changing with SQ actively working on establishing their online platform and PYPL s acquisition of iZettle
However you get the sense Square is more interested in becoming the true one stop shop for payment processing than PayPal Both make things easier such as payroll However PYPL seems to point to existing ways of using their program IE mass payments rather than SQ Payroll which made a specific application for payroll
Price to Sales Growth Rate NormalizationIt s been pointed out Square trades at a much higher P S multiple than competitors like eBay Inc NASDAQ EBAY But that makes sense considering how much faster SQ continues to grow PYPL is no slouch Their 5 year average is 18 26 and their most recent YOY was 20 77 with the latest quarter at 22 99
Source Morningstar PayPal Analysis
That s not the same thing as SQ People pay more for it because the company threw up a 5 year average of 61 20 and the most recent YOY of 29 59 with the latest quarter at 47 77
Source Morningstar Square Analysis
At the moment you have the P S for PayPal at 6 7x and Square at 11 32x Well that kind of makes sense If you assume PYPL at fair value then if SQ puts up 2x 3x their growth pretty consistently over the years you would expect the P S to be double that of PYPL
In fact you really could only make the argument it s overvalued based on the 2017 numbers At the paltry 29 59 growth YOY they should only be 1 42x the P S ratio of PYPL instead of the 1 69x they re at now or a 9 51x P S and 62 a share
But if you took the 3 year average you would be at 2 12x the value of PayPal or 14 2x for an equivalent P S and using the 5 year average you would be 3 35x the value of PYPL or at 22 46x for an equivalent P E That would put the share prices at 93 and 147 per share Where their growth will land is debatable But when you compare the valuation to that of PYPL unless the overall market itself changes it would be tough to see share prices drop much below 60
P E NormalizationLet s consider what the P E ratio would look like for Square if they hit operating margins similar to those of PayPal Right now PYPL runs an 18 82 margin If that margin is applied to SQ s TTM they will put out Net Income of 505m That equates to 1 28 per share At the current price you end up with 57 86x P E That s a good bit higher than PYPL who sits at 44 33x
If you consider these companies equivalent and ignore the growth aspects then a similar valuation of Square would give a share price of 56 74 That s not too far below the low end of what was noted above for the P S analysis Again let s consider what happens when you account for the higher growth Using the 3 year growth rate you d take 44 33 x 2 12 93 98 P E and the 5 year 44 33 x 3 35 148 5 P E That would give share prices of 120 and 190 respectively
It s fair to point out that the business models between the two don t work in the same way Square actually manages not just software but hardware devices PayPal is only just moving into that area
Source Morningstar Square Analysis
Source Morningstar Square Analysis
Why PayPal Doesn t Deserve It s PremiumSo far the article discussed why the valuation of Square relative to PayPal is not outlandish as well as where potential floors and ceilings might exist However that relies on the assumption of PYPL being fairly valued
Referring to the PayPal financials you can see the expansion most years Current margins sit near 18 82 up from 17 3 the prior year It would be very unlikely that operating margins will get much higher than 20 The costs of the business simply make this prohibitive unless you decided to redefine revenues and expenses which is another discussion for another day
Take a step back to the growth rates that PayPal currently sees Right now they ve seen averages that sit between 18 20 per year Let s consider the S P 500 The S P 500 trades at a P S of 2 14x and a P E of 22 60x The earnings growth rate ranged from 6 0 to 14 41 for 5 year and 3 year periods respectively Just using the 18 point you would get a multiplier for PYPL of 1 24x 3 0x
Using these multipliers you would expect to get a range of P S on PayPal between 2 65x 6 42x and a P E of 28 02x 67 8x Considering that the current earnings growth rate for the S P 500 sits at 17 75 on a relative and short term basis the stock is overvalued But in considering the median for the S P 500 sits at 12 28 you d be looking at a P S of 3 17x and P E of 33 12x That would give you a P E derived price of 55 64 and a P S price of 40 12
However the story doesn t end there Remember that PayPal has been expanding their operating margin That gives another multiplier to consider The PEG ratio for PYPL sits at 2 24x The S P 500 sits at 1 25x This would imply that PYPL is being overvalued and better priced at 47 32
ConclusionIf you consider Square relative to PayPal it appears to be fairly valued if not somewhat underpriced However PYPL itself seems to be trading at a premium and has further to fall This would indicate that SQ also has further to fall That would mean it likely to find a stable value base around 60 The easiest way to trade these pairs is to take a long short on any oscillations that cause compression in values If SQ trades lower to PYPL or PYPL higher to SQ it becomes a no brainer |
EBAY | EBay EBAY Stock Sinks As Market Gains What You Should Know | In the latest trading session eBay EBAY closed at 29 86 marking a 0 3 move from the previous day This change lagged the S P 500 s daily gain of 2 12 At the same time the Dow added 2 13 and the tech heavy Nasdaq gained 2 64
Heading into today shares of the e commerce company had lost 10 01 over the past month lagging the Retail Wholesale sector s loss of 2 5 and the S P 500 s loss of 4 4 in that time
Investors will be hoping for strength from EBAY as it approaches its next earnings release which is expected to be January 30 2019 In that report analysts expect EBAY to post earnings of 0 68 per share This would mark year over year growth of 15 25 Our most recent consensus estimate is calling for quarterly revenue of 2 87 billion up 9 81 from the year ago period
For the full year our Zacks Consensus Estimates are projecting earnings of 2 30 per share and revenue of 10 74 billion which would represent changes of 15 and 12 24 respectively from the prior year
Any recent changes to analyst estimates for EBAY should also be noted by investors These recent revisions tend to reflect the evolving nature of short term business trends With this in mind we can consider positive estimate revisions a sign of optimism about the company s business outlook
Our research shows that these estimate changes are directly correlated with near term stock prices To benefit from this we have developed the Zacks Rank a proprietary model which takes these estimate changes into account and provides an actionable rating system
The Zacks Rank system which ranges from 1 Strong Buy to 5 Strong Sell has an impressive outside audited track record of outperformance with 1 stocks generating an average annual return of 25 since 1988 Within the past 30 days our consensus EPS projection has moved 0 32 higher EBAY is holding a Zacks Rank of 3 Hold right now
Investors should also note EBAY s current valuation metrics including its Forward P E ratio of 13 02 For comparison its industry has an average Forward P E of 29 55 which means EBAY is trading at a discount to the group
It is also worth noting that EBAY currently has a PEG ratio of 1 36 This metric is used similarly to the famous P E ratio but the PEG ratio also takes into account the stock s expected earnings growth rate EBAY s industry had an average PEG ratio of 2 31 as of yesterday s close
The Internet Commerce industry is part of the Retail Wholesale sector This group has a Zacks Industry Rank of 184 putting it in the bottom 28 of all 250 industries
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors Our research shows that the top 50 rated industries outperform the bottom half by a factor of 2 to 1
Make sure to utilize Zacks Com to follow all of these stock moving metrics and more in the coming trading sessions |
WFC | Noble Bank Faces Sale Has Broken from Tether and Bitfinex | a financial entity based in Puerto Rico is said to be for sale for 5 to 10 million as reported by Bloomberg The mystery around the bank thickens as an unnamed source close to the bank also alleged that Noble also abandoned its most prominent clients the Tether company and Bitfinex
If the sources are correct in their allegations that would leave Tether without access to a legal bank account after Wells Fargo NYSE WFC dropped the crypto project a few months ago
reported further that the unnamed source mentioned Noble Bank still has a banking license to operate as an international financial company in Puerto Rico and that is the basis for the selling price tag
The news of troubles with the banking of Tether has reigni |
WFC | Wells Fargo has not done enough to refund cheated drivers regulator | By Patrick Rucker and Pete Schroeder WASHINGTON Reuters Wells Fargo NYSE WFC Co has not convinced U S regulators it is doing enough to repay 600 000 drivers who were wrongly pushed into buying auto insurance a leading bank regulator said on Tuesday We are not comfortable where we are with them Joseph Otting the Comptroller of the Currency said at a hearing of the U S Senate Banking Committee In a statement the bank declined to comment on Otting s remarks specifically but said it was working with regulators to repay drivers We regret how this issue has impacted our customers the fourth largest U S bank by assets said in a statement Otting s office this summer rejected Wells Fargo s plan to repay customers who were pushed into unnecessary auto insurance and told the bank it must do more to find and compensate every driver who was hurt Reuters reported in September The rejection was the latest setback for Wells Fargo which has been rocked by two years of scandals over its sales practices In September 2016 the bank paid a 190 million fine after admitting employees had opened perhaps millions of phony customer accounts to hit sales goals In April the bank paid a 1 billion fine to U S regulators for auto insurance and mortgage lending abuses and promised to make sure customers were repaid Drivers who bought a car with a loan from Wells Fargo and let their insurance lapse could be charged for forced place policies The bank enrolled about 2 million drivers into such policies and more than a quarter of those were not needed officials have said The OCC does not have a deadline for when it must approve the plan but Wells Fargo cannot finish its work without that all clear from regulators Democratic Senator Brian Schatz asked Otting when Wells Fargo customers should expect a refund for the faulty charges
I don t have the particular date in front of me Otting said but he said he trusts OCC employees to push the bank to get the job done correctly |
WFC | Wells Fargo planning its first post crisis mortgage bond Bloomberg | Reuters Wells Fargo Co N WFC is planning its first post crisis offering of bonds tied to U S home loans without government backing Bloomberg reported on Thursday citing people familiar with the matter The 441 million non agency bond will include top portions which will be rated AAA and the sale will be finalized next week according to the report
Wells Fargo spokesman Tom Goyda declined to comment on the Bloomberg report |
WFC | 4 Trade Ideas For Wells Fargo Bonus Idea | Wells Fargo Ticker WFC
Wells Fargo WFC moved higher at the end of 2016 pausing over 51 before continuing to a top in March 2017 It pulled back to 51 from there into April and began a sideways movement in a range between 51 and 56 40 that would last for 8 months with only a minor false break down in September that year The move higher from December to January 2018 seemed to have put that range far behind but then it gapped down and into the range bounced and then fell back into it for good It has been in the prior range for 3 months now
Friday it ended at the top of the range and just under the 100 and 200 day SMA s The RSI is in the bullish zone with the MACD crossing up and positive These support a move higher The Bollinger Bands are shifting higher as well There is resistance at 56 40 and 58 55 then 60 and 62 with a gap to fill to 64 and then 66 Support lower comes at 55 20 and 53 30 then 52 90 and 51 Short interest is low under 1 and the company is expected to report earnings next on Friday July 13th
The June monthly options chain shows the largest open interest is at the 55 strike on both sides so it is possible that it ends little changed this week The weekly chains out to July 6 Expiry also show 55 as the biggest open interest The July 13 Expiry the first after the earnings report shows the largest open interest at the 58 Call strike though The July monthly chain falls back to the 55 strike as most popular And finally the August chain shows the 60 Call as most popular followed by the 55 Call
Trade Idea 1 Buy the stock on a move over 56 40 with a stop at 55
Trade Idea 2 Buy the stock on a move over 56 40 and add a July 55 52 50 Put Spread 70 cents as protection Sell the August 60 Call 44 cents to lower the cost
Trade Idea 3 Buy the July 13 Expiry 55 50 58 Call Spread 1 05 and sell the July 13 Expiry 52 Put 31 cents
Trade Idea 4 Buy the August 55 60 Call Spread 1 88 and sell the August 52 50 Put 81 cents
After reviewing over 1 000 charts I have found some good setups for the week These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which heading into the FOMC June meeting and monthly Options Expiration sees the equity markets looking strong
Elsewhere look for Gold to continue to consolidation around 1300 while Crude Oil consolidates after pulling back The US Dollar Index looks to continue lower while US Treasuries are biased lower in broad consolidation The Shanghai Composite is consolidating at 52 week lows and Emerging Markets remain in a pullback in the uptrend
Volatility looks to remain very low keeping the bias higher for the equity index ETF s SPY IWM and QQQ Their charts show the IWM the strongest and leading on the longer timeframe with the SPY and QQQ building strength as well Use this information as you prepare for the coming week and trad em well
The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment I or my affiliates may hold positions or other interests in securities mentioned in the Blog please see my Disclaimer page for my full disclaimer
Original post |
EBAY | Meg Whitman to lead Katzenberg s mobile media startup NewTV | Reuters Departing Hewlett Packard Enterprise Co CEO Meg Whitman will become chief executive of DreamWorks co founder Jeffrey Katzenberg s mobile media firm NewTV a move that places her back into uncharted territory One of the most powerful women in U S business and a former candidate for California governor Whitman will be moving into a nascent sector much like when she took over eBay Inc NASDAQ EBAY in its early stages and turned it into a multi billion dollar business Getting Meg was a coup as many companies wanted her GBH Insights analyst Daniel Ives said on Wednesday Whitman starts March 1 at Katzenberg s startup firm which plans to make Hollywood style short form videos for mobile use This is a change of pace for Meg after stepping down from HP as NewTV and Katzenberg have created a unique business model which has a long runway ahead of it for the coming years Ives said Several media reports said NewTV is trying to raise about 2 billion which would be a significant first round of financing for a digital media startup The firm declined to comment on the funding Katzenberg is chairman of NewTV Whitman who was reportedly a leading candidate for the chief executive job at ride hailing firm Uber before it was given to Dara Khosrowshahi steps down as CEO of Hewlett Packard Enterprise Co on Feb 1 At HPE she pulled off one of the biggest corporate breakups in history She spun off Hewlett Packard Co into HPE and PC and printer business HP Inc in 2015 as part of a plan to turn around the corporation Whitman previously served on the board of DreamWorks Animation which Katzenberg co founded
This Jan 24 story has been refiled to fix typo in the first paragraph |
EBAY | PayPal down more than 8 after eBay drops | In its Q4 report after the close yesterday PayPal NASDAQ PYPL announced it would remain as a checkout option for eBay NASDAQ EBAY until at least 2023 A few hours later though eBay announced its plan to drop PayPal as its payment processor sending PYPL down as much as 15 Netherlands based Adyen will gradually take PayPal s spot beginning this year and will handle a majority of transactions in 2021 A major setback for PayPal says DA Davidson s Gil Luria Though PayPal s total payments volume is less dependent on eBay than in the past it s still a substantial share BTIG s Mark Palmer downgrades to Neutral noting the stock was priced for near perfection and the news makes things far less perfect PYPL lower by 8 3 premarket eBay 12 25 Previously Post earnings rally for eBay Jan 31 Previously PayPal bulls take just a few in profits after strong Q4 Jan 31 Now read |
EBAY | Here Is Where eBay Gets A Bid | Last week electronic commerce company eBay NASDAQ EBAY dropped sharply after reporting earnings and issuing weaker guidance Traders should note that the stock actually peaked on February 1 2018 at 46 99 a share Since that pivot high the shares have plunged and are currently trading a 33 58 eBay is now trading below its important 50 and 200 day moving averages This chart formation now puts the stock in a weak technical position
Support To Watch
There are two key support levels for eBay coming up The first level will be around the 30 00 area This is where the 200 week moving average is located If price comes directly into this moving average it should serve as support when tested The second major support level for the stock stock is around 27 50 which is where the stock was defended in November 2016 Often stocks will find important support when a major pivot area gets retested |
EBAY | PayPal Will Q3 Earnings Show It s Recovering From The eBay Split | Reports Thursday October 18 after the market close
Revenue Expectation 3 66B
EPS 0 54
After surging more than 80 last year shares of online payment giant PayPal Holdings NASDAQ PYPL have done little to impress investors lately Trading at 80 as of yesterday s close the stock was down 15 from the 52 week high of almost 94
After this dismal performance PayPal lovers are left wondering whether this is just a blip or a sign of the stock having peaked The company s third quarter earnings scheduled for release today Thursday October 18 after the market closes may provide some clues
PayPal stock lost its luster earlier this year when eBay NASDAQ EBAY announced that it planed to take over crucial payments processing duties for its core Marketplace e commerce offering a role that PayPal had handled for the e commerce site under a deal signed when the two companies split in 2015 EBAY expects to fully transition to the new system by 2021 with the help of its new payments partner Adyen
As eBay has played a crucial role in PayPal s growth accounting for roughly 13 of total payments processed by the company this shocking announcement sent PayPal shares tumbling from their remarkable rally
PayPal management insists that this loss is manageable as it believes the company is on the right track to expand its offerings To offset the loss the company is mainly focusing on the promotion of Venmo a payment app that has been very popular with smartphone users as well as on acquisitions
When PayPal releases third quarter results later today investors will look for solid evidence that the company has succeeded in monetizing Venmo a feat PayPal has been unable to accomplish until now Just last week PayPal said it will charge 1 when Venmo account holders transfer money quickly to their bank accounts raising the charge from 0 25 per transaction
An aggressive acquisition drive is another part of PayPal s strategy to diversify its payment processing business in order to become less dependent on eBay s business As part of this push the company has bought several companies including Swedish small business payments service iZettle for 2 2 billion
Analysts surveyed by FactSet expect PayPal to report adjusted earnings per share of 0 54 for the last quarter up from 0 46 a year earlier on the sales of 3 66 billion
If PayPal can indeed show significant growth in total volume due to acquisitions and new partnerships we believe its shares will break out of their bearish slump Such an outcome would be important in order to quell investor fears about the company s growth potential over the next three years after the divorce from eBay |
WFC | Judge blocks U S fund s lawsuit against Wells Fargo over vol mageddon | By Trevor Hunnicutt NEW YORK Reuters A Chicago fund manager cannot pursue a lawsuit against a Wells Fargo Co N WFC unit over claims the bank cost the fund manager millions by forcing it to sell its holdings during a February market rout a judge ruled on Tuesday LJM Partners Ltd run by Anthony Caine returned investors money after its complex trades failed spectacularly in the Feb 5 reversal of fortune in U S stocks and related markets that some investors called vol mageddon Funds run by LJM and an affiliate saw losses of 80 percent or more The fund would not have suffered such extreme losses had Wells Fargo Securities LLC WFS not directed it to sell its holdings immediately after initial losses and at depressed prices LJM said in response to a March lawsuit by Wells Fargo Wells Fargo disputed that it had forced the liquidation Wells Fargo said it had been required to cover the company s margin and losses with the Chicago Mercantile Exchange LJM denied those claims and countersued in May But United States District Judge Katherine Forrest in Manhattan said contracts between Wells Fargo and LJM provided broad authority for the bank to tell the fund to trade when the market is stressed The agreement provides broad authority for WFS to terminate the agreement and direct LJM to liquidate its open positions even through specific trades Forrest wrote A spokeswoman for Wells Fargo and lawyers for LJM did not immediately respond to a request for comment
Wells Fargo s lawsuit against LJM is ongoing Investors are suing Caine and Anish Parvataneni a portfolio manager at the company who previously worked for well known fund investor Ken Griffin s Citadel over what they said were inadequate disclosures about the risks of LJM s approach |
WFC | U S producer prices post first drop in one and a half years | By Lucia Mutikani WASHINGTON Reuters U S producer prices unexpectedly fell in August recording their first drop in 1 1 2 years as declines in the prices of food and a range of trade services offset an increase in the cost of energy products Despite the surprise weakness in producer prices reported by the Labor Department on Wednesday overall inflation is steadily rising driven by a tightening labor market and robust economy The Federal Reserve is expected to raise interest rates later this month for the third time this year Inflation pressures should intensify in coming quarters said Ryan Sweet a senior economist at Moody s Analytics in West Chester Pennsylvania The unemployment rate is low GDP growth is above trend wage growth is accelerating and fiscal policy is supportive for the economy The producer price index for final demand slipped 0 1 percent last month after being unchanged in July August s fall in the PPI was the first since February 2017 That further lowered the annual increase in the PPI to 2 8 percent from 3 3 percent in July Economists polled by Reuters had forecast the PPI increasing 0 2 percent in August and advancing 3 2 percent year on year A key gauge of underlying producer price pressures that excludes food energy and trade services edged up 0 1 percent last month The so called core PPI gained 0 3 percent in July In the 12 months through August the core PPI increased 2 9 percent after rising 2 8 percent in July The dollar was trading lower against a basket of currencies while U S Treasury prices rose Stocks on Wall Street were mixed DECLINING MARGINS The correlation between producer and consumer prices has weakened after the government revamped the PPI basket and changed the methodology several years ago The Fed s preferred inflation measure the personal consumption expenditures PCE price index excluding food and energy increased 2 0 percent in July hitting the U S central bank s 2 percent target for the third time this year Government data on Thursday is expected to show consumer prices rising 0 3 percent in August after gaining 0 2 percent in July according to a Reuters survey of economists There has so far been no widespread price increases from the Trump administration s import tariffs on lumber washing machines solar panels steel and aluminum as well as a range of Chinese goods But with the trade war between the United States and China escalating economists believe this will change and expect the import duties to boost inflation in the coming months Recent manufacturing surveys continue to show increases in raw material prices amid growing strains on the supply chain Wholesale food prices fell 0 6 percent in August pulled down by sharp declines in the costs of eggs and fresh fruits and melons Food prices which dipped 0 1 percent in July have now decreased for three straight months Wholesale energy prices rose 0 4 percent in August with gasoline prices surging 0 6 percent after slipping 0 1 percent in the prior month Energy prices fell 0 5 percent in July Overall the cost of wholesale goods was unchanged in August after edging up 0 1 percent in July Prices for iron and steel scrap fell 5 6 percent last month the biggest drop since October 2017 Nonferrous scrap prices decreased 8 7 percent the largest decline since January 2009 The cost of services slipped 0 1 percent last month led by a 0 9 percent decline in the index for trade services which measures changes in margins received by wholesalers and retailers Services dipped 0 1 percent in July Over 80 percent of the drop in the cost of services last month was attributed to margins for machines and equipment wholesaling which fell 1 7 percent Declining margins at machinery and equipment firms suggest producers may be struggling to pass on rising input costs related to recent tariffs said Sarah House a senior economist at Wells Fargo NYSE WFC Securities in Charlotte North Carolina The cost of healthcare services rose 0 3 percent as a 0 5 percent drop in prices for hospital outpatient care was offset by a 0 6 percent jump in the cost of doctor visits which was the largest gain since June 2010 There were also increases in prices of hospital inpatient and dental care
Healthcare prices ticked up 0 1 percent in July Those healthcare costs feed into the core PCE price index |
WFC | Wells Fargo sees total expenses dropping by 3 billion by 2020 CFO | Reuters Wells Fargo NYSE WFC Co s chief financial officer said on Friday the bank expects to reduce total expenses by about 3 billion by 2020 Speaking at an industry conference CFO John Shrewsberry said the bank was on track to reach its target of 53 5 to 54 5 billion by the end of 2018 He sees expenses in the range of 50 0 billion to 51 0 billion in 2020
The outlook excludes remediation and penalty costs associated with the widespread regulatory and legal problems at the bank For the current quarter the company expects approximately 200 million in costs from ongoing efforts to repay customers who were overcharged for various services |
WFC | Wells Fargo to cut headcount by 5 10 percent in next three years | Reuters Wells Fargo Co N WFC said on Thursday it would reduce its headcount by about 5 percent to 10 percent within the next three years as part of a turnaround plan As of June 30th the nation s fourth largest bank had roughly 264 500 employees making a 10 percent reduction representative of about 26 450 jobs Wells Fargo said the latest reduction would reflect displacements as well as normal team member attrition The cuts will help Wells reach its goal of reducing costs by 4 billion by 2020 as it tries to grow profits and recover from a series of scandals while operating under the Federal Reserve s asset cap Wells Fargo has also said it will reduce its branch count by about 800 by 2020 and sell non core businesses to lower costs and become more efficient Last month the bank laid off 600 employees in its mortgage division which has faced headwinds amid a slowdown in refinancing demand The layoffs were not a surprise according to Keefe Bruyette Woods analyst Brian Kleinhanzl and that sentiment was reflected in Wall Street s muted reaction to the news The stock rose 0 6 percent to 55 55 during Thursday trading Employee related costs are the largest expense so that was likely where the cuts were coming he said Automation also lowers the need for staffing over time The bank did not specify which departments or regions would be impacted by the reductions but it said the cuts will be made to reflect changing consumer preferences as more customers perform banking tasks using self service technology Wells Fargo takes very seriously any change that involves its team members and as always we will be thoughtful and transparent and treat team members with respect said Chief Executive Tim Sloan in a statement Wells Fargo reported a lower than expected quarterly profit in July as lending activity slowed and the bank said much of the decline had to do with moves to avoid riskier loans
Wells Fargo s shares rose 0 6 percent to 55 55 in late afternoon trading on Thursday |
WFC | High nicotine e cigarettes flood market despite FDA rule | By Chris Kirkham Reuters The sleek Juul electronic cigarettes have become a phenomenon at U S high schools vexing educators and drawing regulatory scrutiny over their sweet flavors and high nicotine content Now a new wave of lower priced Juul knock offs is showing up at convenience stores vape shops and online despite a U S Food and Drug Administration rule banning the sale of new e cigarette products after August 2016 without regulatory approval Start ups and major tobacco firms have launched more than a dozen new high nicotine devices with Juul like designs since the FDA imposed the deadline according to a Reuters review of the companies online advertisements social media posts and public statements The FDA earlier this month threatened to ban Juul and four other leading vaping products unless their makers take steps to prevent use by minors But the warning came after companies introduced a slew of new Juul copycats following the August 2016 deadline with no regulatory consequences In a statement to Reuters the agency said it was investigating whether certain brands are being improperly sold without FDA approval and that it plans to take additional action on this front very soon The agency said it would focus on products with high nicotine concentrations and flavors appearing to target young people and take swift action wherever appropriate The FDA set the August 2016 deadline to rein in the fast growing industry but allowed sales of Juul and other older devices to continue without regulatory approval until 2022 The companies that started marketing new devices after the deadline include startup firms such as Kandypens Myle Vapor and VGOD as well as large multinational tobacco companies including British American Tobacco LON BATS Plc and Imperial Brands LON IMB Plc Kandypens touted its new Rubi vaping device last October more than 14 months after the August 2016 cutoff with an Instagram post saying it had been working hard over here for the last 12 months on the product Vaping distributor VGOD posted on its website in May that it was an honor to finally introduce the STIG referencing its Stig Pods a disposable three pack of high nicotine devices British American Tobacco chief executive Nicandro Durante said on a July 2018 earnings call that the company would be launching its higher nicotine Vuse Alto product in the United States the following month Imperial Brands announced its myblu brand of e cigarettes in a February 2018 press release Kandypens Myle and VGOD did not respond to requests for comment Spokespeople for Imperial Brands and British American Tobacco said their products were compliant and on the market before August 2016 Imperial Brands said it had purchased an existing e cigarette brand and renamed it British American Tobacco did not respond to questions about its marketing or sales A spokeswoman for Juul Labs Inc Victoria Davis said the company is cooperating with regulators and working to prevent underage use of a product designed to help adult smokers quit tobacco cigarettes No minor or non nicotine user should ever try Juul Davis said E cigarettes vaporize a liquid that contains nicotine the addictive stimulant that gives smokers a rush The Juul design mimics a flash drive with plug in cartridges of concentrated nicotine juice It is far more compact than earlier vaping devices and produces less vapor making it easy to use without being detected an attribute some health advocates say attracts teenagers Juul s imitators are also small and compatible with higher nicotine blends though some can also be filled with lower strength juice The Chinese company Suorin introduced several such devices to the United States over the past year Many high schoolers and college students said they have switched to these products because buying widely available nicotine liquids is less expensive than Juul pods In a statement Suorin said it didn t have clear guidance from the FDA on regulations governing its newer products but hopes to better understand how to fully comply The company said its products are only intended for adult smokers One Juul pod has the nicotine content of about 20 cigarettes the number in a traditional pack according to Juul s marketing A pod can be consumed in a day by a heavy user according to interviews with Juul customers Many of the newest blends from Juul and its imitators called nicotine salts in the industry contain a compound called benzoic acid which lowers the pH level of the liquid That reduction allows users to take in more nicotine without a bitter taste according to the U S Centers for Disease Control and Prevention CDC In addition to the devices dozens of high nicotine e liquids have arrived on the market with names such as frozen mystery pop rainbow drops and Tokyo chocolate banana which critics say are designed to attract young customers Vaping proponents argue the Juul and similar new products give cigarette smokers looking to quit a much better option than lower nicotine e cigarettes It gives the same exact sensation as a cigarette except you don t wake up coughing at 2 a m said Charles Trejo a manager at V for Vape a Los Angeles retailer Public health researchers say high nicotine vaping devices like the Juul have proven adept at drawing in new customers including teenagers who never used tobacco What they re doing is creating addicts in large numbers said Dr Robert Jackler a professor who heads a group studying the impact of tobacco advertising at Stanford University High nicotine vaping devices amount to a weaponisation of the drug he said citing research showing young people are particularly susceptible to nicotine addiction which could lead them to other addictions including cigarettes HIGH SCHOOL JUUL ROOMS The companies launched the copycat devices as Juul s market share surged from 13 6 percent of the e cigarette market in early 2017 to more than 70 percent now according to a Wells Fargo NYSE WFC analysis of Nielsen retail data which does not include online sales The FDA s regulation of e cigarettes has come under scrutiny in recent months as Juul s popularity has taken off Anti smoking advocates complained about the Juul lookalikes in an August letter to the FDA saying the agency had failed to assert its authority over companies that had evaded the review process The FDA said it planned to respond to the letter but declined further comment Vaping increased by nearly eightfold between 2011 and 2017 among U S high school students according to the most recent CDC data Experts say last year s survey likely underestimates the increase because it was conducted before a surge in Juul sales Many high schools have resorted to locking bathrooms jokingly called Juul rooms by students Marcella Bianco who helps develop school anti vaping curriculum for the non profit organization Catch My Breath said elementary schools have recently started requesting materials Educators fear the high nicotine devices could erode decades of progress in reducing youth tobacco use Smoking among high school students declined from 15 8 percent to 7 6 percent between 2011 and 2017 according to the CDC but e cigarette use grew from 1 5 percent to 11 7 percent over the same period It s like a flashback to 20 years ago said Kathryn Hensley a school board member in St Lucie County Fla Are we starting all over again E cigarettes have occupied a regulatory gray area in the United States since they emerged a decade ago Only in 2016 did the FDA finalize rules to regulate e cigarettes including the requirement that companies get approval for new products Research on the long term health effects of e cigarettes is limited They are widely viewed as safer than tobacco cigarettes because they don t contain the same cocktail of toxic and cancer causing chemicals The U K Royal College of Physicians said in a 2016 report that e cigarettes were 95 percent less harmful than smoking tobacco citing a reduction in the risk of serious disease and death The CDC has said e cigarettes are safer than conventional cigarettes but has not assigned a specific risk reduction because the products can vary widely Some health experts are particularly worried about the impact of nicotine from e cigarettes on adolescents Research from a 2016 U S Surgeon General s report found that such exposure could have lasting adverse consequences for brain development and cognition on teenagers A study released by the National Academy of Sciences this year cited evidence that vaping among young people increases the risk of eventually smoking tobacco BANNED IN OTHER COUNTRIES High nicotine vaping devices and liquids are not allowed in many other parts of the world including in the European Union and the United Kingdom which have both set nicotine limits at 20 mg mL in e cigarette liquids Regulators said that level was effective for most smokers trying to quit Juul pods are rated at 59 mg mL according to the company s marketing Israeli regulators last month banned Juul out of concern over its high nicotine content saying the device posed serious danger to public health Davis the Juul Labs spokeswoman said in August the company was incredibly disappointed with what it called the Israeli government s misguided decision to crack down on healthier alternatives to tobacco cigarettes The company has since introduced a lower nicotine version of the product in Israel that it says complies with regulations there Davis said Juul believes the higher nicotine version of the product still provides the best option for smokers trying to quit Imperial Brands new myblu product arrived in the United States earlier this year Matt Kessler a spokesman for Fontem Ventures the Imperial Brands unit that owns myblu said the brand complies with the FDA rules because it is a re imagination of a similar e cigarette that was marketed by a company that Imperial brands acquired a year earlier The new myblu brand however offers 4 percent nicotine strength meaning at least 40 mg mL according to company advertising higher than any previously offered by the earlier e cigarette model called My Von Erl Devices that vaporize higher nicotine liquids fall under the definition of new products subject to FDA review according to the 2016 regulation Kessler declined to comment further on nicotine levels in myblu saying only that the product is compliant with FDA regulations Durante the CEO of British American Tobacco acknowledged on the July earnings call that its Vuse Alto device had not been widely available before the August 2016 deadline He said that s not required under FDA rules To be grandfathered by the FDA he said you could be in market in one store two stores only in the whole country The FDA declined to comment on whether myblu and Vuse Alto are compliant or if availability in one or two stores would be considered on the market The agency said it would consider the totality of the evidence to decide a whether a vaping product had been commercially available before the regulatory deadline STRUGGLE TO QUIT As new high nicotine Juul competitors arrive vaping enthusiasts on YouTube are posting reviews of the next Juul killer aiming to take a piece of the red hot market Milo Gringlas a freshman at Cornell University said Juul has become so ubiquitous on campus that a popular late night food truck now sells vaping devices and nicotine liquids Everybody either has one or is looking for one he said Austin Tompkins who lives in Los Angeles has struggled for the last six months to kick his addiction to Juul which he started using about three years ago when he was 19 He realized he needed to stop when he would wake up in the middle of the night needing another hit In his latest attempt he s made it two months without vaping The urge hasn t gone away
I m telling you right now I would love a hit of a Juul he said |
WFC | Is STYAX A Strong Bond Fund Right Now | Any investors hoping to find a Government Mortgage Intermediate fund could think about starting with Wells Fargo NYSE WFC Core Plus Bond A STYAX bears a Zacks Mutual Fund Rank of 1 Strong Buy which is based on nine forecasting factors like size cost and past performance ObjectiveSTYAX is one of many Government Mortgage Intermediate funds to choose from Government Mortgage Intermediate funds focus on the mortgage backed securities MBS market This market takes mortgages packages them together and sells off the pooled securities to investors This particular category focuses on MBS that usually have at least three years to maturity but less than 10 giving a medium risk and yield profile to funds here History of Fund ManagerWells Fargo is based in San Francisco CA and is the manager of STYAX Since Wells Fargo Core Plus Bond A made its debut in July of 1998 STYAX has garnered more than 239 57 million in assets A team of investment professionals is the fund s current manager PerformanceInvestors naturally seek funds with strong performance This fund carries a 5 year annualized total return of 2 53 and it sits in the top third among its category peers If you re interested in shorter time frames do not dismiss looking at the fund s 3 year annualized total return of 2 52 which places it in the top third during this time frame When looking at a fund s performance it is also important to note the standard deviation of the returns The lower the standard deviation the less volatility the fund experiences The standard deviation of STYAX over the past three years is 3 19 compared to the category average of 7 13 Over the past 5 years the standard deviation of the fund is 3 4 compared to the category average of 7 15 This makes the fund less volatile than its peers over the past half decade Bond DurationModified duration is a measure of a given bond s interest rate sensitivity and is a metric that s a good way to judge how fixed income securities will respond in a shifting rate environment If you believe interest rates will rise this is an important factor to look at STYAX has a modified duration of 5 92 which suggests that the fund will decline 5 92 for every hundred basis point increase in interest rates IncomeSince income is of course a big reason for purchasing a fixed income security it is always important to consider the fund s average coupon This metric calculates the fund s average payout in a given year For example this fund s average coupon of 3 5 means that a 10 000 investment should result in a yearly payout of 350 A higher coupon is good for those seeking a strong level of current income but it could also pose a reinvestment risk if rates are lower in the future when compared to the initial purchase date of the bond Since income is just one part of the bond picture investors need to consider risk relative to broad benchmarks With a beta of 1 05 this fund is less volatile than a broad market index of fixed income securities Taking this into account STYAX has a positive alpha of 1 which measures performance on a risk adjusted basis RatingsInvestors should also consider a bond s rating which is a grade AAA to D given to a bond that indicates its credit quality With this letter scale in mind STYAX has 52 97 in high quality bonds rated at least AA or higher while 30 85 are of medium quality with ratings of A to BBB The fund has an average quality of AA and focuses on high quality securities ExpensesFor investors taking a closer look at cost related metrics is key since costs are increasingly important for mutual fund investing Competition is heating up in this space and a lower cost product will likely outperform its otherwise identical counterpart all things being equal In terms of fees STYAX is a load fund It has an expense ratio of 0 94 compared to the category average of 0 83 Looking at the fund from a cost perspective STYAX is actually more expensive than its peers Investors should also note that the minimum initial investment for the product is 1 000 and that each subsequent investment needs to be at 100 Bottom LineOverall Wells Fargo Core Plus Bond A has a high Zacks Mutual Fund rank and in conjunction with its comparatively strong performance average downside risk and higher fees Wells Fargo Core Plus Bond A looks like a good potential choice for investors right now Want even more information about STYAX Then go over to Zacks com and check out our mutual fund comparison tool and all of the other great features that we have to help you with your mutual fund analysis for additional information And don t forget Zacks has all of your needs covered on the equity side too Make sure to check out Zacks com for more information on our screening capabilities Rank and all our articles as well |
EBAY | BMO Capital positive on eBay | Shares of eBay NASDAQ EBAY perk up in early trading after BMO Capital takes its rating to Outperform from Market Perform The firm says eBay s Promoted Listing products is tracking above expectations and sees upside with other new initiatives BMO s price target on eBay of 45 reps 25 upside potential for shares EBAY 2 53 premarket to 36 09 Now read |
EBAY | Why Is EBay EBAY Down 7 2 Since Its Last Earnings Report | It has been about a month since the last earnings report for eBay Inc NASDAQ EBAY Shares have lost about 7 2 in that time frame
Will the recent negative trend continue leading up to its next earnings release or is EBAY due for a breakout Before we dive into how investors and analysts have reacted as of late let s take a quick look at its most recent earnings report in order to get a better handle on the important drivers eBay Q1 Earnings Match Estimates Revenues MisseseBay Inc first quarter 2018 earnings matched the Zacks Consensus Estimate while the revenues missed the same by a slight margin Pro forma earnings of 53 cents improved 9 year over year Gross revenues of 2 58 billion were up 12 on a year over year basis up 7 on an Fx neutral basis and within the guided range of 2 57 2 61 billion Revenues were below the Zacks consensus estimate of 2 598 billion Shares gained 4 3 in after hours trading in response to the company s weaker than expected revenue growth Also in the past 12 months the stock has gained 19 1 underperforming its industry s growth of 42 4 On the call management sounded impressed with the progress of the company s transformation and the positive response of customers to it eBay is leveraging on its structured data and Artificial Intelligence AI strength to build product catalogs enhance mobile platform roll out new browse inspired shopping journeys enhance customer to customer C2C business and strengthen its brand It accelerated its AI efforts through structured data personalization image search technology and customer support initiatives in several areas During the quarter eBay announced that it will acquire Giosis Japan business including the Qoo10 jp platform The deal which is expected to close in the second quarter of 2018 will likely expand eBay s footprint in Japan Overall we remain positive about eBay s replatforming and brand enhancement initiatives Its unique capabilities backed by technological improvements give it an edge over competitors such as Etsy ETSY Alibaba NYSE BABA and Facebook NASDAQ FB Revenues and GMVIn the first quarter the Marketplace platform contributed 22 5 billion of gross merchandise volume GMV and 2 1 billion of revenues Marketplace GMV grew 13 year over year on a reported basis and 7 on an FX Neutral basis The increase was aided by continued expansion of new user experiences StubHub contributed 1 billion of GMV up 14 on a year over year basis and revenues of 232 million up 9 year over year The increase was driven by a robust sports landscape including a record Super Bowl and strong international growth Classifieds platforms also performed well with contribution of 246 million of revenues up 24 both on a year over year and 10 on a FX Neutral basis driven primarily by strength in Germany Total GMV of 23 6 million in the first quarter grew 13 year over year on a reported During the quarter global active buyers customers increased 4 from the year ago quarter to 171 million Margins and IncomePro forma gross margin for the quarter was 78 3 up 60 basis points bps year over year Adjusted operating expenses of 1 36 billion increased 16 1 from the prior year quarter Pro forma operating margin was 27 9 down 100 bps year over year The decrease was due to increased investments in sales and marketing and product development GAAP net income was 5 4 billion compared with 5 6 million in the year ago quarter Balance Sheet and Cash FloweBay s balance sheet is highly leveraged with long term debt of 9 2 billion Cash and short term investments balance were 4 8 billion at the end of first quarter versus 5 9 billion in the prior quarter eBay generated 495 million in cash from operating activities and spent 158 million on capex Free cash flow during the quarter was 337 million and the company repurchased shares worth 1 billion OutlookFor the second quarter of 2018 eBay expects revenues to grow 6 8 on an Fx neutral basis to 2 64 2 68 billion better than the Zacks Consensus Estimate of 2 68 billion Non GAAP earnings are expected within 50 52 cents and the Zacks Consensus Estimate is pegged at 52 cents GAAP earnings per share from continuing operations are expected in the range of 33 37 cents eBay maintained its full year guidance The company expects full year revenues between 10 9 billion and 11 1 billion The Zacks Consensus Estimate is pegged at 11 02 Adjusted earnings per share are expected between 2 25 and 2 30 The Zacks Consensus Estimate is pegged at 2 29
How Have Estimates Been Moving Since Then
In the past month investors have witnessed a downward trend in fresh estimates There have been two revisions higher for the current quarter compared to five lower
eBay Inc Price and Consensus VGM Scores
At this time EBAY has an average Growth Score of C though it is lagging a bit on the momentum front with a D Following the exact same course the stock was allocated a grade of D on the value side putting it in the bottom 40 for this investment strategy
Overall the stock has an aggregate VGM Score of D If you aren t focused on one strategy this score is the one you should be interested in
The company s stock is suitable solely for growth based on our styles scores
Outlook
Estimates have been broadly trending downward for the stock and the magnitude of these revisions indicates a downward shift Notably EBAY has a Zacks Rank 3 Hold We expect an in line return from the stock in the next few months |
WFC | Canadian dollar to rally say strategists betting on trade deal Reuters poll | By Fergal Smith TORONTO Reuters Canada s dollar is likely to rally over the coming months according to foreign exchange strategists in a Reuters poll who forecast that trade uncertainty will fade and the Bank of Canada will continue to raise interest rates The latest poll of more than 35 market strategists taken Sept 1 4 predicted the Canadian dollar would rally to C 1 30 against the U S dollar or about 77 U S cents in three months from nearly a seven week low of C 1 32 on Tuesday The currency which has weakened nearly 5 percent this year is expected to reverse that trend and climb to C 1 26 in a year matching the forecast of the August poll At the end of the day we expect Canada to acquiesce to a trade deal so that does remove some level of uncertainty said Mazen Issa a senior FX strategist at TD Securities The problem however is timing The loonie hit a nearly seven week low on Tuesday at C 1 3208 after Canada and the United States ended talks last week to revamp the North American Free Trade Agreement without reaching a deal Canadian officials are due to resume talks with their U S counterparts on Wednesday Canada sends about 75 percent of its exports to the United States so the economy is likely to suffer if a deal is not reached The Bank of Canada which has worried that trade uncertainty will hold back business investment will wait at least until October before raising interest rates again according to a separate Reuters poll taken late last week The central bank has raised rates four times since July 2017 taking its policy rate to 1 50 percent from 0 50 percent We are generally constructive on commodity prices and we do expect the Bank of Canada to tighten rates a little bit more relative to the U S Fed over the next 12 months said Shaun Osborne chief currency strategist at Scotiabank Those two things we think should combine to give the CAD a bit of support at least over that sort of time frame The price of oil CLc1 one of Canada s major exports has rallied more than 15 percent this year But industrial metals have been pressured by a trade dispute between the United States and China and investor worries that global growth will lose momentum Copper futures HGc1 have fallen more than 20 percent since December Canada runs a current account deficit so its economy depends on the global flow of capital Still obstacles for the Canadian dollar such as trade uncertainty U S dollar strength and investor dislike of risk sensitive currencies could fade over time said Erik Nelson a currency strategist at Wells Fargo NYSE WFC We think all three of those things are going to turn more favorable for the Canadian dollar in the six to 12 months or so Nelson said
Other stories from the global foreign exchange poll |
WFC | Faced with trade war risk yuan to manage only modest rise Reuters poll | By Vivek Mishra BENGALURU Reuters The Chinese yuan will trim only some of its recent losses against the dollar over the coming year with the People s Bank of China increasingly likely to intervene to support the currency against a still rampant dollar a Reuters poll found Trading in the partly managed yuan which has lost about 5 percent since the start of the year was volatile this week amid threats that U S President Donald Trump could impose additional tariffs on Chinese goods worth 200 billion But in the last few weeks China s central bank stepped in to support the currency and avoid heavy capital outflows strengthening the yuan by about 1 5 percent against the greenback from its weakest level this year on August 15 Chinese authorities having allowed the yuan to weaken in response to the trade escalation have now signaled that they are unwilling to let the currency slide further beyond the 6 95 7 00 level last seen in late 2016 noted Khoon Goh Head of Asia Research at ANZ In the past the authorities have been successful in eventually turning yuan weakness around Trade tension is unresolved and the PBoC is likely to further support growth But even with this the signal the PBoC is sending suggests the yuan could be due for a rebound in the near term The yuan is expected to gain 1 percent to 6 77 per dollar in a year according to the poll of over 50 foreign exchange strategists taken Sept 3 5 from around 6 84 late on Wednesday However 18 of 40 common contributors have now revised their forecasts to a weaker yuan compared with a poll taken last month citing the risk that global trade tensions worsen Thirteen of them kept their projections unchanged and the remaining 9 revised them to reflect a stronger currency Nine strategists see the yuan weakening to 7 to the dollar or higher at some point over the 12 month period two more than in the poll taken one month ago The PBoC has taken multiple steps to arrest the sharply depreciating yuan by making the currency expensive for investors to bet on helping to ease market speculation in a bid to avoid a repeat of the shock devaluation of the renminbi seen in 2015 One of the measures the PBoC undertook to shore up the yuan was to reintroduce the counter cyclical factor to its daily fixing mechanism at the end of August This would allow investors to trade 2 percent above or below the daily reference rate set by the central bank Following this bearish bets on the renminbi were sharply reduced a separate Reuters survey showed ASIA FXP We are fairly bearish on the U S dollar over the near term and see weakness in the yuan as a multi reflection of dollar strength said Erik Nelson currency strategist at Wells Fargo NYSE WFC and the top forecaster for Asian currencies in 2017 In the very near term the Chinese currency is out of the woods but I think by early next year we will see a decisive recovery in the yuan and decisive resumption of greenback weakness But the wider Reuters foreign exchange poll found the U S dollar which has had its best run so far this year since 2015 will hold on to the gains until December and not beyond EUR POLL Still the 12 month forecast for the yuan was the most pessimistic median in Reuters polls conducted this year Several currency strategists said renewed pressure on the yuan is inevitable as the Sino U S trade war escalates threatening to put more pressure on China s already cooling economy ECILT CN Seventeen of 50 participants said the yuan will weaken below the current level of 6 84 in a year with the most pessimistic forecast expecting it to fall to 7 30 a level not seen since last financial crisis Policy tightening from the U S Federal Reserve and rising Treasury yields could affect the yuan s stability The prospect of a new trade war could hurt China s export competitiveness and the PBoC is loosening monetary policy to cope with credit contraction So I don t deny for a moment that yuan will face depreciation pressure said Li Yishuang FX analyst at China Securities in Beijing
The chance of yuan falling below 7 in the short term is low but in the long term the movement will depend on dollar index Polling by Khushboo Mittal and Vivek Mishra Editing by Ross Finley and Matthew Mpoke Bigg |
WFC | U S dollar to keep currency crown this year but not next Reuters poll | By Hari Kishan BENGALURU Reuters The U S dollar which has had its best yearly performance since 2015 so far in 2018 will hold on to those gains for the rest of the year but beyond that is unlikely to maintain its ascendancy a Reuters poll showed A majority of foreign exchange strategists in Reuters polls since the dollar s resurgence in April had predicted a reversal in its fortunes with the upward trend not expected to last more than three months But the current rally has outlasted those expectations Still the latest poll of over 50 strategists taken Aug 31 Sept 5 showed the dollar up over 3 percent this year would reverse that trend with most currencies including battered emerging market currencies forecast to gain in a year s time That thinking is driven by expectations that U S economic growth momentum has peaked as well as the fact that many of the things underpinning the dollar ranging from expected Federal Reserve interest rate hikes to the U S China trade dispute have now been priced in The substantial U S dollar rally was not widely expected even within the context of looking over the past long term downtrend in the dollar against major currencies It has definitely gone on for long and has been a surprise based on the length and magnitude of this corrective bounce in the dollar said Nick Bennenbroek head of FX strategy at Wells Fargo NYSE WFC But over time once the fiscal stimulus eventually fades we do expect the dollar to soften over time and there are indications that it might be getting closer to the end While there has been no let up in the trade wrangling between the United States and China with President Donald Trump set to ramp up tariffs on more Chinese imports the dollar s performance over the past month has been mixed Currency speculators reduced bets in favor of the U S currency in the latest week for the first time in 11 weeks after net long dollar positions hit a more 1 1 2 year high the previous week Still the latest poll showed the U S currency is not likely to fall in the near term Indeed the median probability of a dollar correction of 5 percent or more by year end was only 20 percent according to responses to an additional question The dollar is overvalued and the Fed isn t doing anything to send it higher but that s enough for it to remain top dog in currency markets in the absence of good news elsewhere noted Kit Juckes global head of FX strategy at Societe Generale PA SOGN The winner is the currency that doesn t lose And right now that s still the dollar There s not much to make me think the dollar should be going up but there s plenty to make me nervous about other currencies In a year s time though the euro which is down more than 3 percent against the dollar this year is forecast to gain 4 percent to 1 21 from around 1 16 on Wednesday Sterling will gain around 6 percent against the dollar in a year but expectations for that rise are conditional upon Britain leaving the European Union with a deal which is not certain GBP POLL The Japanese yen which is also considered a safe bet during times of economic distress is forecast to gain over 2 percent against the dollar in a year USD remains supported across the board due to market fears about a U S led global trade war a booming U S economy and continuing Fed policy normalization all of which underscore the appeal of the currency noted strategists at CA CIB Over the long term we anticipate renewed USD underperformance on the back of a flatter U S Treasury yield curve concerns about the U S s deteriorating twin deficits and the diminishing positive growth impact from President Trump s fiscal stimulus
Reuters FX poll graphic Polling by Sarmista Sen and Nagamani L Editing by Ross Finley and Janet Lawrence |
WFC | Justice Department probing Wells Fargo s wholesale banking unit WSJ | Reuters The U S Justice Department is probing whether employees committed fraud in Wells Fargo NYSE WFC Co s wholesale banking unit following revelations that employees improperly altered customer information the Wall Street Journal reported on Thursday citing people familiar with the matter The department has sought more information from the bank to see if management pressure prompted the employees to improperly alter or add the information prior to a regulatory deadline the Journal reported citing the same people The Justice Department is interested in learning if there is a pattern of unethical and potentially fraudulent employee behavior tied to management pressure the WSJ reported The incident happened in 2017 and early 2018 as Wells Fargo was trying to meet a deadline to comply with a regulatory consent order related to the bank s anti money laundering controls according to a WSJ report in May The report had also said the bank had reported the problem to the Office of the Comptroller of the Currency and the agency was probing the problem Wells Fargo smarting from a prolonged sales scandal in its retail banking business has been a subject of a number of regulatory probes Wells Fargo did not immediately comment on the report
Shares of Wells Fargo were down 1 percent at 58 40 |
WFC | Cboe reports August options total contract volume falls 3 2 Y Y | Cboe Global Markets CBOE 0 4 reports August trading volume Options total volume fell 3 2 to 156 7M contracts Y Y total average daily volume of 6 8M vs 7 0M Futures total volume decline 36 to 5 8M contracts Y Y total ADV 253 000 vs 399 000 U S equities total volume fell 5 8 to 25 0B shares Y Y total ADV 1 1B vs 1 2B European equities total notional volume rose 11 to EUR205 6M Y Y total average daily notional volume EUR 8 9M vs EUR8 0M Global FX total notional volume rose 29 to 802B Y Y total ADNV 34 9B vs 27 1B Previously Cboe Global Markets sees H2 tax rate at higher end of year guidance range Aug 3 Now read |
WFC | Exclusive U S regulators reject Wells Fargo s plan to repay customers sources | By Patrick Rucker WASHINGTON Reuters U S regulators have rejected Wells Fargo Co s N WFC plan to repay customers who were pushed into unnecessary auto insurance telling the bank it must do more to ensure it has found and compensated every affected driver three sources familiar with the matter told Reuters Wells Fargo gave regulators the plan in June as required by a 1 billion settlement the bank reached with the Consumer Financial Protection Bureau CFPB and the Office of the Comptroller of the Currency OCC in April After reviewing the plan which could involve contacting some 600 000 drivers the OCC told Wells Fargo it needed more assurances that the bank would find and repay everyone who was overcharged said the sources who were not authorized to speak publicly about the rejection The rejection is the latest wrinkle in Wells Fargo s long running sales scandal which began in September 2016 with revelations that the bank had opened perhaps millions of accounts in customers names without permission to hit aggressive sales targets Since then Wells has disclosed more customer abuses in businesses including mortgage lending wealth management and the auto loans at issue here Representatives for Wells Fargo the OCC and the CFPB declined to comment Drivers who bought a car through Wells Fargo and let their insurance lapse could be charged for forced place policies Wells enrolled about 2 million drivers into such policies and more than a quarter of those were not needed officials have said Customers who were charged for unneeded insurance could face overdraft fees damaged credit or vehicle repossession As part of its settlement agreement Wells Fargo had to review several years worth of bank and insurance paperwork for those customers Although Wells Fargo gave regulators details on the number of customers harmed what financial consequences they suffered and how the bank planned to compensate them the OCC wants to see work behind the calculations before it will approve the plan the sources said The regulator also wants an explanation of how workers are performing day to day remediation tasks they said The OCC does not have a deadline for when it must approve the plan but Wells Fargo cannot finish its work without that all clear from regulators It is not unusual for banks and regulators to haggle over the fine print of a settlement and large banks tend to satisfy regulator demands quickly after a large penalty said the sources and former officials
Last year Wells Fargo estimated that it would need 64 million to pay back customers but lawyers representing drivers say that estimate is way too low |
WFC | Is The Rally In U S Dollar ETFs Short Lived | The greenback has been on an ascent with PowerShares DB US Dollar Index Bullish Fund returning about 3 1 in the last one month as of May 22 2018 Steady U S economic recovery which has proved sturdier than other developed economies in recent times and a prospects of faster than expected Fed rate hikes this year boosted the greenback
The first reading of the U S GDP for the first quarter of 2018 advanced at a 2 3 annual rate of growth above market expectations of 2 U S consumer spending has also gained momentum read
On the other hand the European Central Bank ECB hinted at moderation in economic growth and the need to keep the policy rate constant The British economy also marked the weakest growth rate in Q1 The Japanese economy contracted in Q1 against the markets expectation of no growth
Will the Uptrend Continue
Maybe the recent rally in the U S dollar is temporary We ll have to wait for a quarter to see whether the slowdown in other developed economies is momentary or fundamental This will give us an idea about the long term course of currencies
Apart from this a Wells Fargo NYSE WFC strategist noted in March that there is pain ahead for dollar bulls The strategist pointed to a more fundamental factor that over the last 50 years the greenback has actually treaded lower
could be one of the factors behind this High U S debt load as much as 19 trillion can have an adverse impact on the value of its currency read
Brandywine Global Investment Management recently forecast the greenback to slide about 5 by the end of 2018 Dollar s its recent rally resulted in rich valuations and the ought to put some pressure on the dollar said senior vice president for portfolio management at the Legg Mason Inc NYSE LM
The U S budget deficit ballooned to in the first half of the fiscal year the Treasury Department said last month as quoted on Bloomberg The recent tax cuts and fiscal reflation approved by Trump are expected to goad the deficit to 804 billion in fiscal 2018 and then exceed the 1 trillion level by 2020
Moreover a range bound U S Treasury yields might cap the dollar rally According to Pacific Investment Management Co U S 10 year Treasury yield will hover in a 3 3 5 range for the rest of the year
ETFs in Focus
Dollar bulls can play WisdomTree Bloomberg U S Dollar Bullish Fund apart from UUP USDU is up 3 2 in the past one month However investors who are cautious about the long term prospects of the greenback should focus on PowerShares DB US Dollar Index Bearish Fund The bear fund is down 3 1 in the past one month as of May 22 2018 read
Want key ETF info delivered straight to your inbox
Zacks free Fund Newsletter will brief you on top news and analysis as well as top performing ETFs each week |
EBAY | StubHub inks deal with NFL | StubHub announces a multi year agreement with the National Football League to become the league s authorized ticket resale marketplace The arrangement will begin next year with the 2018 2019 season The company says the deal will mark the the first time that the NFL has permitted an independent marketplace to integrate directly into the primary ticketing systems of its 32 clubs StubHub is a subsidiary of eBay EBAY 2 2 Source Press ReleaseNow read |
EBAY | EBay Stock Dips On In Line Q1 Earnings Revenue Miss | EBay NASDAQ EBAY just released its first quarter financial results posting adjusted earnings of 0 53 per share and revenues of 2 58 billion
EBay is currently a Zacks Rank 2 Buy which is subject to change based on today s results Shares of EBay are up 25 5 over the last year and 2 4 in the last four weeks EBay dipped slightly on Wednesday to hit 40 97 per share prior to the release of its first quarter earnings results
EBay stock is currently down 4 56 to 39 10 per share in after hours trading shortly after its earnings report was released
EBAY
Matched earnings estimates The company posted adjusted earnings of 0 53 per share matching the Zacks Consensus Estimate
Missed revenue estimates The company saw revenue figures of 2 58 billion missing our consensus estimate of 2 6 billion
EBay s Q1 revenues jumped roughly 12 from 2 30 billion in the year ago period Meanwhile the online seller s quarterly earnings climbed 9 from 0 49 per share
Looking ahead to the second quarter EBay expects to post adjusted earnings in the range of 0 50 per share to 0 52 per share which falls in line with our current estimates
Here s a graph that looks at EBAY s Price Consensus and EPS Surprise history eBay Inc Price Consensus and EPS Surprise Check back later for our full analysis on EBAY s earnings report
Investor Alert Breakthroughs PendingA medical advance is now at the flashpoint between theory and realization Billions of dollars in research have poured into it Companies are already generating substantial revenue and even more wondrous products are in the pipeline Cures for a variety of deadly diseases are in sight and so are big potential profits for early investors Zacks names 5 stocks to buy now |
WFC | Mexican Peso Rally Shows Traders Are Betting a Nafta Deal Is Near | Bloomberg Traders are taking an optimistic view on Mexico s peso amid conflicting reports about the outlook for trade talks with the U S
The currency strengthened as much as 1 1 percent Wednesday as investors bet on a positive resolution to discussions over a revamped North American Free Trade Agreement Bloomberg News reported that the U S and Mexico are moving closer to a deal despite key sticking points in negotiations overshadowing comments from a U S Trade Representative official who said that major Nafta issues remain and cautious signals from Mexico s incoming Nafta negotiator who also sought to walk back expectations
The USTR may have denied a deal is imminent but there is rarely smoke without fire and I think it s clear that a deal can be struck said Christian Lawrence a currency analyst at Rabobank in New York It looks like there is some progress
Nafta headlines have buffeted the currency since Donald Trump took office but positive news along with a more conciliatory attitude toward the business community from incoming Mexican president Andres Manuel Lopez Obrador have helped send the peso to a world beating rally this year
The peso was volatile Wednesday as the contradicting news reports came out but was 0 6 percent stronger at 18 8373 per dollar as of 11 20 a m in New York
Markets are hesitant to commit firmly to headlines until there is an actual formal deal announced said Erik Nelson a strategist for Wells Fargo NYSE WFC in New York However there is potential for a larger peso rally if a deal is in fact reached in the near term
A bilateral deal between the U S and Mexico Canada isn t participating in the current round of talks will probably be a precursor to a broader Nafta agreement according to Frances Hudson an Edinburgh based global strategist at Aberdeen Standard Investments which oversees more than 770 billion of assets She said that s a positive for Mexico s peso as it would encourage U S investment and reduce geopolitical uncertainties
It s a stark turnaround from the days after Trump s election and inauguration when the peso sunk to record lows on concern the countries relationship would suffer
I m not sure what the new Nafta deal looks like but the fact that Nafta is here is clearly unambiguously a win for Mexico relative to what people feared when Trump first took office said Jan Dehn the head of research at Ashmore Group PLC in London |
WFC | Wells Fargo lays off more than 600 mortgage workers | By Imani Moise Reuters Wells Fargo Co N WFC is laying off more than 600 workers as it grapples with a slowdown in its mortgage business a bank spokesman said on Friday The fourth largest U S bank has given 60 days notice to 638 mortgage employees across the country Wells Fargo spokesman Tom Goyda said in an emailed statement with cuts concentrated in Orlando Florida Ranch Cordova California Colorado Springs Colorado and Charlotte North Carolina After carefully evaluating market conditions and consumer needs we are reducing to better align with current volumes Goyda said Wells Fargo has been making sporadic cuts to its mortgage workforce as part of a bid to rein in costs These layoffs are the largest so far this year The home lending business has struggled as rising interest rates hurt refinancing demand Wells Fargo s mortgage banking income fell 33 percent in the second quarter from a year earlier The latest cuts were mainly to retail fulfillment and servicing jobs Goyda said reflecting a continued slump in application volumes Analysts have said such moves address overcapacity and will improve the bank s efficiency Wells Fargo has vowed to cut 4 billion in costs by 2020 in order to grow profits as it operates under a punitive asset cap levied by the Federal Reserve
The Orlando Sentinel reported the layoffs on Thursday |
WFC | Forex Dollar Ditched Amid Optimism Over Trade | Investing com The dollar continued its retreat against its rivals Tuesday shrugging off mostly positive U S economic data as the United States deal with Mexico eased trade concerns reducing demand for the greenback
The U S dollar index which measures the greenback against a trade weighted basket of six major currencies fell by 0 23 to 94 45
Optimism over trade relations after the U S struck a deal with Mexico on Monday prompted traders to continue to unwind their bullish bets on dollar some of which had been made on the back of trade uncertainties
Still lingering trade tensions remained as investor focus shifted to U S Canada trade talks which got underway on Tuesday U S Treasury Secretary Steven Mnuchin said Tuesday the Trump administration s objective is to try to get Canada on board quickly
President Trump on Monday announced his administration had reached a deal with Mexico on issues that have upended the renegotiation of the North American Free Trade Agreement NAFTA the current trilateral trade agreement among the U S Canada and Mexico
USD MSN rose 1 10 to 18 9712 while USD CAD fell 0 38 to C 1 2918
Upbeat data showing consumer confidence hit an 18 year high and strong regional manufacturing drew a modest advance from lows in the dollar
The Conference Board s consumer confidence gauge rose to 133 4 in August from 127 9 in July beating economists forecast for a reading of 126 7
The Richmond Fed manufacturing index rose by 4 points to a reading of 24 in August from the prior month beating expectations for a reading of 18
Analysts attributed the rise in consumer confidence to a tightening labor market underpinning expectations for rises in wage growth
Current optimism continues to be a reflection of the tightening labor market Consumers generally expect their incomes to rise over the next six months while employment conditions are expected to remain fairly stable Wells Fargo NYSE WFC said in a note to clients
Also keeping a lid on the dollar s advance was a rise in the euro against the greenback to 1 1717 up 0 33 despite concerns over political uncertainty in Italy
The main downside risk to the outlook for EUR USD in the near term continues to be posed by Italian political developments MUFG said
GBP USD was flat at 1 2889 as fears of a no Brexit deal which would see the U K crash out of the European Union without a trade deal with the member bloc continued to limit gains in the pair
USD JPY fell 0 01 to Y111 06 |
WFC | Wells Fargo fires bankers after probe into doctoring of expense receipts Wall Street Journal | Reuters Wells Fargo Co N WFC has fired or suspended more than a dozen employees in its investment bank over alleged violations of the company s expense policy regarding after hours meals the Wall Street Journal reported on Thursday citing people familiar with the matter The bank is investigating dozens of others ranging from analysts to managing directors in New York San Francisco and Charlotte for doctoring receipts on dinners that they charged to the bank the Journal reported citing the people |
WFC | 4 Trade Ideas For Wells Fargo Bonus Idea | Here is your Bonus Idea with links to the full Top Ten
Wells Fargo NYSE WFC reported earnings April 13th and saw it s stock trade down through support The company then received a 1 billion fine for their mortgage business last week Yikes the trouble seems to never end at this bank But the stock price ended last week with a 2 day rally and back over that support In fact there are some indications that the worst may be over
The Bollinger Bands have squeezed in as it rose the last 2 days The RSI made a higher high as it approaches the bullish one The MACD has crossed up and is rising All support a move to the upside There is resistance at 53 35 and a move over that could trigger a big run There is resistance above that at 54 25 and 54 75 then 56 35 and 58 50 then 60 and a gap to fill above that to 64 Support lower comes at 51 10 and 50 30 then 49 60 and 46 80 before 44 65 Short interest is low under 1
The May options chain shows the biggest open interest at the 55 strike on the call side 3x that at the 50 strike on the put side June options show a cluster from 47 50 to 57 50 on the put side with the call side seeing 2 spikes in open interest around 55 and 65 The July options after the next earnings report have biggest open interest in the call side at 52 50 65 and 70
Wells Fargo Ticker WFC
Trade Idea 1 Buy the stock on a move over 53 50 with a stop at 51
Trade Idea 2 Buy the stock on a move over 53 50 and add a July 52 50 47 50 Put Spread 1 58 for protection
Trade Idea 3 Buy a July 47 5 55 bullish Risk Reversal 54 cents
Trade Idea 4 Buy a May July 55 Call Calendar 90 cents
After reviewing over 1 000 charts I have found some good setups for the week These were selected and should be viewed in the context of the broad picture reviewed Friday which with April options expiration in the rearview mirror sees the markets head into the last full week of April trading Here in Northeast Ohio the weather is mixed with sunshine but very cold temperatures and some snow hardly spring time and stocks look the same confused sometimes strong and then weak again
Elsewhere look for Gold to consolidate in a broad range while Crude Oil continues to be the strongest market rising higher The US Dollar Index churns along sideways while US Treasuries are now in a downtrend The Shanghai Composite has also turned downward while Emerging Markets continue to mark time at the highs
Volatility has been stuck in a more normal range and does not look to be changing that anytime soon This has left the equity index ETF s SPDR S P 500 NYSE SPY iShares Russell 2000 NYSE IWM and PowerShares QQQ Trust Series 1 NASDAQ QQQ to blaze their own path Their charts continue to frustrate in the short term falling back from lower highs but longer term continue to consolidate in broad ranges at the top Use this information as you prepare for the coming week and trad em well
DISCLAIMER The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment I or my affiliates may hold positions or other interests in securities mentioned in the Blog please see my page for my full disclaimer |
WFC | Dollar ETFs Bounce Back Can The Rally Continue | The greenback has regained luster over the last few days touching the on May 1 PowerShares DB US Dollar Index Bullish Fund is down 1 8 in the year to date frame but has gained about 3 5 since Apr 16
What Drives the Recent Rally
Better Positioned U S Economy Fed Rate Hikes
The U S economy has been enjoying an edge over other developed regions which made the U S dollar relatively more compelling The first reading of the U S GDP for the first quarter of 2018 advanced at a 2 3 annual rate of growth above market expectations of 2 read
U S consumer spending grew in March while the Fed s preferred inflation gauge touched the central bank s 2 goal for the first time in a year The personal consumption expenditures PCE price index marked the biggest increase since February 2017
Such growth and the inflation data should give the Fed enough confidence to proceed with its policy tightening spree The Fed has already enacted a hike in March and is expected to enact two more in 2018 However many market watchers expect this year
On the other hand the European Central Bank s ECB latest meeting held on Apr 26 2018 hinted at moderation in economic growth and the need to keep the policy rate constant The ECB reaffirmed its intention to go slow when it comes to the possibilities of policy tightening read
The British economy also marked the weakest growth rate in Q1 of this year since a 0 1 shrinkage seen in the fourth quarter of 2012 The rate of inflation in the U K dropped to in March 2018 from 2 7 in the prior month below market expectations of 2 7 This indicates dovishness in the Bank of England BoE s future policies
Compelling Valuation
The dollar ETF lost about 9 in the past one year despite the Trump rally and U S economic growth One of the reasons behind the weakening of dollar was Trump s intent to have a weaker currency for enjoying trade competitiveness Now that the U S economic and monetary policy backdrop is in favor of the greenback investors will understandably want to cash in on the low valuation
Will the Uptrend Continue
Maybe the recent rally in the U S dollar is short lived We ll have to wait for a quarter to see whether the slowdown in other developed economies is momentary or fundamental This will give us an idea about the long term course of currencies
Apart from this a Wells Fargo NYSE WFC strategist noted in March that there is pain ahead for dollar bulls The strategist pointed to a more fundamental factor that over the last 50 years the greenback has actually treaded lower
could be one of the factors behind this High U S debt load as much as 19 trillion can have an adverse impact on the value of its currency read
Also most recently Trump tweeted that Russia and China are playing as the U S keeps raising interest rates Not acceptable This tweet ensures that trade war game via weak currency should not be ruled out over the long term read
ETFs in Focus
Dollar bulls can play WisdomTree Bloomberg U S Dollar Bullish Fund apart from UUP USDU is down 2 5 this year but up 3 1 since Apr 16 However investors who are cautious about the long term prospect of the greenback should focus on PowerShares DB US Dollar Index Bearish Fund read
Want key ETF info delivered straight to your inbox
Zacks free Fund Newsletter will brief you on top news and analysis as well as top performing ETFs each week |
EBAY | Semtech SMTC To Report Q4 Earnings What s In Store | Semtech Corporation NASDAQ SMTC is set to report fiscal fourth quarter 2018 results on Mar 14 Last quarter it posted a positive earnings surprise of 10 2 The company s surprise history has been pretty impressive It beat estimates in each of the last four quarters with an average of 6 9 Coming to share price movement Semtech s stock has returned only 0 87 in the last year underperforming the s gain of 24 9 Let s see how things are shaping up for this announcement Factors at PlaySemtech reported mixed fiscal third quarter 2018 results with earnings beating the Zacks Consensus Estimate but revenues missing the same The company s improved profitability was driven by differentiated growth drivers and diversification strategy Key growth drivers for Semtech are product differentiation operational flexibility and a specific focus on fast growing segments and regions In the fiscal third quarter the company saw strong demand for high end consumer and industrial end markets The growing need for more efficient energy management in home and industrial settings increasing electronic system requirements for mobile devices and propagation of green standards will continue to drive demand in these segments However weakness in the enterprise computing and communications markets could impact results Also concerns about the company s exposure to seasonality a competitive market and foreign exchange risk persist For fiscal fourth quarter 2018 on a non GAAP basis management expects revenues in the range of 138 142 million This implies 7 1 sequential decline at the mid point of the guided range Non GAAP gross profit margin is expected within 61 0 and 62 0 Management projects SG A expenses within 26 27million and research and development expenses in the range of 23 24 million Non GAAP earnings per share are expected to come in at 40 42 cents Earnings WhispersOur proven model does not conclusively show that Semtech will beat on earnings this quarter This is because a stock needs to have both a positive and a Zacks Rank 1 Strong Buy 2 Buy or 3 Hold for this to happen That is not the case here as you will see below Zacks ESP The Earnings ESP for the company is 0 41 You can uncover the best stocks to buy or sell before they re reported with our Zacks Rank Semtech carries a Zacks Rank 3 which when combined with a 0 00 ESP makes a surprise prediction difficult We caution against stocks with a Zacks Rank 4 or 5 Sell rated going into the earnings announcement especially when the company is seeing negative estimate revisions Semtech Corporation Price and EPS Surprise
Stocks to ConsiderWe see a likely earnings beat for each of the following companies EVINE Live Inc NASDAQ EVLV has an Earnings ESP of 13 79 and Zacks Rank 2 You can see FactSet Research Systems Inc NYSE FDS has an Earnings ESP of 0 18 and a Zacks Rank 3 eBay Inc NASDAQ EBAY has an Earnings ESP of 0 44 and a Zacks Rank 3 The Hottest Tech Mega Trend of All Last year it generated 8 billion in global revenues By 2020 it s predicted to blast through the roof to 47 billion Famed investor Mark Cuban says it will produce the world s first trillionaires but that should still leave plenty of money for regular investors who make the right trades early |
WFC | Forex Swashbuckling Dollar Powers to Nearly 18 Month Highs as Euro Slumps | Investing com The dollar rose against its rivals to an 18 month high Tuesday supported by a slump in the euro as concerns over Turkey s vulnerable economy persisted despite a rebound in the lira
The U S dollar index which measures the greenback against a trade weighted basket of six major currencies rose by 0 342 to 96 56
The lira rose more than 7 against the greenback clawing back some earlier losses suffered on Friday and Monday But analysts said Turkey was experiencing a crisis of confidence warning there may yet be more pain to come
In our experience most confidence issues are not one and done they often need to get worse before they get better Furthermore a crisis of confidence is usually a very fluid and dangerous situation because investor and market sentiment can turn for the worse very quickly Wells Fargo NYSE WFC said
Turkey s central bank on Monday said it would provide as much liquidity as necessary cutting lira and foreign currency reserve requirements for Turkish banks
That however did little stem concerns as analysts continued to questioned Turkey central bank s independence from the government the biggest issue for most investors
The currency lira remains in free fall as long as the Turkish central bank s independence from the government is an issue Commerzbank DE CBKG analysts said
Concerns about European banks exposure to Turkey weighed on the euro lifting the greenback as the single currency shrugged off data showing faster than expected economic growth in the member bloc
EUR USD fell 0 61 o 1 1340
Elsewhere the dollar was also boosted by an ongoing plunge in the pound as data showed U K wage growth slowed amid investors fears that Britain s departure from the European Union will be fractious
The rebound in the lira saw demand for safe haven yen and the Swiss franc ease
USD JPY rose 0 34 to 111 07 while USD CHF fell 0 03 to 0 9936
USD CAD fell 0 27 to C 1 3099 |
WFC | Royal Bank of Scotland pays 4 9 billion for crisis era misconduct | By Pete Schroeder WASHINGTON Reuters Royal Bank of Scotland L RBS will pay 4 9 billion to settle U S claims that it misled investors on residential mortgage backed securities between 2005 and 2008 the U S Justice Department said on Tuesday The Justice Department said the penalty is the largest ever imposed on a bank for misconduct leading up to the financial crisis The bank announced in May that it had reached the settlement in principle The government alleges RBS misled investors in underwriting and issuing residential mortgage backed securities understating the risks behind many of the loans and providing inaccurate data Despite assurances by RBS to its investors RBS s deals were backed by mortgage loans with a high risk of default Andrew E Lelling U S Attorney for the District of Massachusetts said in a statement The Justice Department said that RBS disputes the allegations and does not admit wrongdoing although the bank said in a statement it was happy to move on There is no place for the sort of unacceptable behavior alleged by the DoJ at the bank we are building today RBS Chief Executive Ross McEwan said In conjunction with the settlement the bank also said it would be paying out an interim ordinary dividend of 2 pence per share on Oct 12 to shareholders The dividend is the bank s first since its near collapse and 45 5 billion pound 58 billion state bailout in 2008 The DOJ settlement and the resumption of dividends were two of the last big milestones in RBS s decade long journey back to normality The looming Justice Department fine had weighed on the bank s share price and prevented it from paying out to its shareholders Together with hefty cuts made to its investment bank and international business a return to dividends could help shift the bank s profile with investors from a risky bet into a safe predictable value stock It also expands the market for future government share sales by enabling a broader array of investors to look at buying the bank s shares Tuesday s announcement marks the latest in a long running series of massive settlements struck between the U S government and large global banks over conduct leading up to the financial crisis
On Aug 1 the Justice Department struck a settlement with Wells Fargo NYSE WFC which agreed to pay 2 09 billion to settle similar claims |
WFC | Gold Prices Fall Despite Softer U S dollar | Investing com Gold prices dropped on Thursday while the U S dollar also slid despite higher demand in safe haven assets amidst the Turkish lira crisis
Gold Futures for December delivery went down by 0 48 to 1 179 2 per troy ounce at 12 02AM ET 04 02 GMT on the Comex division of the New York Mercantile Exchange
The U S dollar index that tracks the greenback against a basket of six other currencies also pulled back to 96 36 down by 0 24 after hitting a 13 month high in the previous session
While traders remain concerned that the Turkish lira crisis might escalate into a new global financial disaster most analysts believe it would not develop into a full blown crisis as the country accounts for only less than 1 of the world economy
Turkey s crisis raises concerns about more fragile emerging market countries that similarly carry larger current account deficits like Brazil South Africa and Argentina Wells Fargo NYSE WFC Investment Institute said in a report
The Turkish lira recovered on Wednesday after Qatar promised to invest 15 billion in the country
Soner Cagaptay political scientist at the Washington Institute said in a tweet that the meeting is a big deal that could build investor confidence in Turkey staving off potential economic collapse
The Turkish lira crisis began last Friday when the U S announced sanctions against its NATO ally and doubled the tariffs on Turkish steel and aluminum sending the lira down by over 20 |
WFC | Wells Fargo Flashes Weakness Ahead | Wells Fargo NYSE WFC has been under pressure since January 29 2018 when it traded as high as 66 31 a share Since that pivot high the stock has been steadily declining On Tuesday WFC traded at 50 91 a share It should be noted that the stock is now trading below its important 50 and 200 day moving averages This technical chart position usually indicates further weakness in the stock price near term
Watch This Price
Traders must now keep an eye on the 48 area as the next major support level This is where the stock broke out in November 2016 Often prior breakout levels will be defended when initially retested |
EBAY | PayPal to expand lending offering with acquisition | By Anna Irrera NEW YORK Reuters Payments firm PayPal Holdings Inc O PYPL has agreed to acquire online lending company Swift Financial in a bid to expand its business that provides working capital to merchants The acquisition will allow PayPal to offer loans to the larger businesses that process payments through its platform and better provide credit to firms that are not yet users of its services the company said on Thursday San Jose California based PayPal did not disclose terms of the deal which is subject to regulatory approval Founded in 2006 Delaware based Swift Financial extends credit to businesses through loans and advances PayPal has been offering short term loans to its smaller merchants through a division called PayPal Working Capital since 2013 It uses data on the payments it processes for its merchants to assess their credit worthiness The company has lent more than 3 billion to 115 000 small businesses in loans of up to 125 000 since inception The deal will enable PayPal to start offering term loans of up to 500 000 to its larger merchants and take advantage of Swift Financial s data capabilities to lend to companies that may not be long time users of its services This is an area where customers have been asking for more Darrell Esch vice president and commercial officer of global credit at PayPal said in an interview Since breaking off from eBay Inc NASDAQ EBAY in 2015 PayPal has been expanding partnerships and acquiring new services to gain advantage over rivals in a highly competitive digital payments market Online lending which took off after banks retreated from offering loans to small businesses and consumers in the wake of the 2007 2009 financial crisis takes advantage of digital technologies to offer loans at lower costs Online lenders say they are better at servicing new types of e commerce companies because their business models may not fit the established underwriting parameters used by traditional financial institutions such as banks Linda Lightman chief executive of an online luxury consignment business she started from her home 17 years ago and a long time PayPal user secured a loan from it in June as the payments company launched its first loan product for larger businesses with Swift Financial
With a bank it is a much more elongated experience Lightman told Reuters For PayPal it was a day They understand our business to begin with |
EBAY | EBay Stock Pops As Q4 Revenues Surge 9 | eBay Inc NASDAQ EBAY just released its fourth quarter 2017 financial results posting adjusted earnings of 0 59 per share and revenues of 2 61 billion Currently eBay is a Zacks Rank 5 Strong Sell and is up over 7 to 43 50 per share in after hours trading shortly after its earnings report was released
EBAY
Matched earnings estimates The company posted adjusted earnings of 0 59 per share matching the Zacks Consensus Estimate of 0 59 per share
Matched revenue estimates The company saw revenue figures of 2 61 billion which also met our consensus estimate of 2 61 billion
EBay reported quarterly revenues that popped 9 year over year driven in large part by a 10 gain in gross merchandise volume Total GMV reached 24 4 billion in Q4
The online marketplace giant posted a GAAP net loss of 2 6 billion in the fourth quarter or 2 51 per share due to a 3 1 billion tax charge from the new Republican Tax law On an adjusted basis eBay posted net income of 618 million in Q4
The company saw its active buyers jump by 5 to end its fiscal year with 170 million global active buyers
Q4 was a record quarter for eBay representing the fifth quarter in a row of volume acceleration in our US Marketplace CEO Devin Wenig said in a statement
We have made great progress transforming eBay while delivering meaningful growth and we expect further acceleration in 2018 as we continue to execute our strategy
Here s a graph that looks at EBAY s Price Consensus and EPS Surprise history eBay Inc Price Consensus and EPS Surprise eBay Inc is a global commerce leader which includes our Marketplace StubHub and Classifieds platforms Collectively eBay connect millions of buyers and sellers around the world The technologies and services that power platforms are designed to enable sellers worldwide to organize and offer their inventory for sale and buyers to find and purchase it virtually anytime and anywhere
Check back later for our full analysis on EBAY s earnings report
The Hottest Tech Mega Trend of AllLast year it generated 8 billion in global revenues By 2020 it s predicted to blast through the roof to 47 billion Famed investor Mark Cuban says it will produce the world s first trillionaires but that should still leave plenty of money for regular investors who make the right trades early |
EBAY | PayPal And eBay No Longer Friends | PayPal Holdings NASDAQ PYPL announced earnings of 0 55 per share yesterday which exceeded Wall Street expectations of 0 52 per share However the stock was trading lower as their forward guidance did not meet expectations
Things got worse when eBay NASDAQ EBAY announced that it would begin using a Dutch firm called Adyen as its primary payments provider This would lower the cost of doing business on eBay by reducing transactions costs for its merchants
PayPal will remain and option for customers at least until 2023 However eBay expects most of its payments to be processed by Adyen by 2021
In Thursday morning trading EBAY was trading 13 higher on the news while PYPL was down 9
Our analysis of the EBAY chart below shows the stock moving higher as it begins a new market cycle Our near term projection is 49
Our analysis of the PYPL chart shows possible continued price action to the downside into May with a price target near 68
The market cycles on the charts below are designated by the black semicircles at the bottom of the chart |
WFC | Wells Fargo to pay 2 09 billion fine over decade old mortgage loans | Reuters Wells Fargo N WFC has agreed to pay 2 09 billion in penalty to settle claims related to mortgage loans originated in the run up to the financial crisis The civil fine is for alleged origination and sale of residential mortgage loans that the lender knew contained misstated income information and did not meet the quality that Wells Fargo represented the U S Department of Justice said in a statement on Wednesday Today s agreement holds Wells Fargo responsible for originating and selling tens of thousands of loans that were packaged into securities and subsequently defaulted said Alex Tse acting U S attorney in San Francisco The loans in question included subprime and other relatively risky home loans We are pleased to put behind us these legacy issues regarding claims related to residential mortgage backed securities activities that occurred more than a decade ago Wells Fargo CEO Tim Sloan said The settlement amount was fully accrued as of June 30 the bank said This is the latest blow to the San Francisco based bank as it tries to recover from a sales scandal that has hurt its results and tarnished its reputation In April the company paid 1 billion in fines to resolve probes into auto insurance and mortgage lending abuses
Since the sales scandal surfaced about two years ago the bank has overhauled management and replaced John Stumpf as CEO It is also running campaigns to regain trust including an ad saying Wells Fargo was established in 1852 and re established in 2018 |
WFC | Fed Leaves Key Rate Unchanged With Economy Growing at Strong Rate | Bloomberg Federal Reserve officials left U S interest rates unchanged and stuck with a plan to gradually lift borrowing costs amid strong growth that backs bets for a hike in September
Economic activity has been rising at a strong rate and unemployment has stayed low the Federal Open Market Committee said Wednesday in a statement released in Washington Household spending and business fixed investment have grown strongly
While leaving rates on hold as expected the committee repeated guidance for further gradual increases in its policy benchmark lining up September s FOMC meeting for the third hike of the year
President Donald Trump lashed out at the Fed last month saying he wasn t thrilled it was raising rates The comments threw a political cloud over the central bank s decisions though economists and investors had widely anticipated Wednesday s decision
Policy makers are not really affected or paying close attention to the political commentary said Laura Rosner senior economist at Macropolicy Perspectives
Stocks and bonds shrugged off the Fed announcement with the Standard Poor s 500 Index closing down 0 1 percent and the 10 year Treasury yield at 3 percent at 4 p m New York time Odds for a rate hike at the central bank s Sept 25 26 meeting held around 80 percent
The FOMC did nothing to the statement that would suggest a lower likelihood of a September hike said former Fed Governor Laurence Meyer who runs a policy research firm in Washington The market has now priced a September rate hike as a near certainty and we agree with that assessment
Fed Chairman Jerome Powell is trying to nurture the second longest U S expansion on record by slowly reducing the amount of support that monetary policy provides to growth The economy is riding a tailwind from tax cuts and higher federal spending though a trade war threatens to dent growth
The committee described risks to the outlook as roughly balanced and restated that monetary policy remains accommodative while leaving the target range for its benchmark policy rate at 1 75 percent to 2 percent
Most Fed officials in June projected three or four rate hikes for 2018 implying one or two more moves this year
There s a lot of concern that the trade negotiations and the heightened rhetoric surrounding trade negotiations might lead to slower economic activity later in the year said Mark Vitner senior economist at Wells Fargo NYSE WFC Securities LLC in Charlotte North Carolina While it certainly looks like it s all systems are go for another rate hike in September and another one in December the text hasn t been written just yet on that
Pricing in federal funds futures markets imply odds slightly above 60 percent for a fourth rate hike in December
Policy makers weighed their action against a generally positive backdrop The U S economy grew at a 4 1 percent pace in the second quarter its fastest pace since 2014 Inflation is close to the Fed s 2 percent goal rising at 2 2 percent for the year ending June while the core rate that excludes food and energy was up 1 9 percent
The committee noted in the statement that both headline and core inflation remain near 2 percent
Unemployment was 4 percent in June below the Fed s 4 5 percent estimate of the level that reflects full employment The gradual pace of rate increases shows that officials want to see if tight labor markets can continue to draw more people into the workforce and produce higher wages without sparking unwanted inflation
Wednesday s decision was unanimous 8 0 Voting members shifted chairs at this meeting with John Williams voting for the first time as New York Fed president and FOMC vice chairman with Kansas City Fed chief Esther George taking his place as an alternate for San Francisco while it seeks a new president |
WFC | Forex Dollar Inches Lower as U S Jobs Services Activity Disappoint | Investing com The dollar fell against its rivals Friday as data showed the U S economy created fewer jobs than expected and services activity slowed in July
The U S dollar index which measures the greenback against a trade weighted basket of six major currencies fell by 0 15 to 94 86
The U S economy added just 157 000 jobs in June well below forecasts for 193 000 new jobs while the unemployment rate was unchanged at 3 9 the Labor Department said on Friday
Analysts played down the weaker nonfarm payrolls saying the underlying trend of U S job creation remained on track
Even with today s miss the trend in payroll growth remains solid Wells Fargo NYSE WFC said
Average hourly earnings grew 0 3 in July and 2 7 in the 12 months through July in line with economists forecasts But analysts said the timid wage growth does little to support the Fed s position that tighter labor markets would lead to price pressures
Wages are moving up but we re not seeing a spike in wages that would concern the market about a sudden rise in inflation said Evan Brown director of asset allocation at UBS Asset Management There s not much of a reaction in markets at the moment
The services sector a critical component of the US economy accounting for roughly 80 of U S private sector gross domestic product GDP unexpectedly weakened in July according to the Institute of Supply Management s Index
ISM non manufacturing data for July showed an drop to 55 7 missing expectations of 58 6
A rise in yen on safe haven demand amid fresh U S China trade war fears also held back the dollar
China is reportedly preparing to retaliate against the United States recent threat to raise trade penalties on goods imported from China with tariffs on about 60 billion worth of U S goods
USD JPY fell 0 38 to Y111 23 while USD CHF fell 0 25 even as the Swiss National Bank said there was room to lower rates if needed
EUR USD rose 0 05 to 1 1591 while USD CAD fell 0 35 to C 1 2978
GBP USD fell 0 01 to 1 3017 amid Brexit related angst after the Bank of England governor Mark Carney said the risk of a no deal Brexit was uncomfortably high |
WFC | Wells Fargo faces tax credit probes new problems with mortgage borrowers | NEW YORK Reuters Wells Fargo Co N WFC is facing government probes into its use of low income housing tax credits and has also set aside 8 million to compensate borrowers who were incorrectly denied mortgage modifications under a federal assistance program the bank said in a regulatory filing on Friday The new disclosures add to Wells Fargo s numerous regulatory penalties private lawsuits and remediation efforts Most stem from a sales practices scandal that has touched on all of the bank s major business units The tax inquiries are being conducted by multiple agencies which Wells Fargo did not name in its 10 Q filing with the U S Securities and Exchange Commission They focus on how the bank purchased or negotiated the purchase of the credits in connection with financing of low income housing developments Representatives for the Internal Revenue Service the Federal Housing Finance Agency and the U S Department of Housing and Urban Development did not immediately respond to requests for comment The 8 million accrual is intended for roughly 625 borrowers who should have qualified for a loan modification under a program the Treasury Department set up in 2009 to help Americans who were struggling to make mortgage payments An error in Wells Fargo s underwriting tool improperly excluded those borrowers 400 of whom eventually had their homes foreclosed upon the bank said
The bank also updated disclosures on issues it has discovered in auto lending wealth management fiduciary and custody accounts foreign exchange trading mortgage rate lock extensions add on products like identity theft protection and frozen or closed bank accounts |
EBAY | Opening Bell Politics Data Roil EUR Bitcoin Shoots Past 8K | Key Events
Late yesterday just four days shy of the two month anniversary of the German general election Chancellor Angela Merkel who had already lost 20 of the votes she d garnered during the previous 2013 election saw her attempt to cobble together a coalition government collapse This after a month of exploratory coalition talks between Merkel s Christian Democratic Party the Green Party and the smaller though in this case lynchpin Free Democratic Party Negotiations reached an impasse before midnight Sunday on a dispute over migration policy and the FDP broke off talks
On September 25 the day after the election we noted
The electoral results in Germany may mean that Merkel will be unable to form a viable coalition for months introducing considerable uncertainty for the single currency
Sure enough there is already talk of a possible new election However according to the analysts said none of Germany s parties had an obvious contender to assume her mantel
The euro dropped as much as 0 64 percent during the early Asian session but between 2 and 4 AM EDT it rebounded on positive economic news when German PPI MoM and YoY met expectations rising 0 3 percent and 2 7 percent respectively After the release previous losses were wiped out and the single currency actually climbed 0 8 percent higher than it had been when trading started There s nothing like cold hard economic data with which to erase any whiff of instability generated by political pundits
Also this morning Germany s DAX fell to a seven week low to start the trading week leading major European benchmarks lower However after gapping down 0 61 percent the DAX pared losses to just 0 16 percent as of 4 07 EDT As with the euro it demonstrates that investors think less of politics and more about economics The continued sustainable economic growth in Germany and the eurozone is providing all the certainty investors require in lieu of political stability
Global Economic Affairs
After China s ongoing regulatory crackdown on risky highly leveraged trades seemed to enter yet another phase late Friday Chinese equities including the Shanghai Composite were hit this morning
However as investors had an opportunity to take a closer look at the details of the newly drafted rules including the prohibition of implicit guarantees regarding returns markets rebounded
With the exception of China equities in other parts of Asia extended losses The MSCI Asia Pacific Index slipped half of one percent last week ending a rally that moved the index 6 percent higher The rally halted at the pre 2008 crash high spurring many technical analysts including to forecast a massive double top as equities in Asia show fatigue In other words investors may be too scared to keep supporting additional rallies
The spread between 2 year and 10 year Treasury yields is the stuff that gives institutional investors heartburn It s returned to its narrowest level in a decade a clear indication of a lack of faith in sustainable US economic growth now being expressed via the spread by the smart money
The battered British pound which has been locked in a range since October 13 received a boost from reports the UK may increase their divorce fee offer to the EU ahead of the critical meeting with EU leaders in December
Bitcoin climbed past 8 000 for the first time on Sunday after traders were able to set aside technology concerns that had led the most popular cryptocurrency into a 29 percent crash Speculation that a SegWit2x hard fork might still be a possibility may have also driven the digital currency s price higher
Bitcoin has had a remarkable year so far The opening price at the beginning of 2017 was 966 60 On January 30 it broke the 1 000 level and reached 1 241 30 on March 2 besting the price of gold for the first time which was then trading at 1 1 25
On May 15 Bitcoin broke above 2 000 and less than a month later on June 12 it hit an intra day high of 3 000 As June closed the cryptocurrency moved past the 3 000 mark settling at 3 265 40 By August 8 it had closed above 3 500 nearly triple the price of gold at the time which was then trading at 1 262 60
That said the gold market is worth trillions while Bitcoin s market cap was only about 57 billion at the time However by August 13 the cryptocurrency had climbed above 4 000 and rapidly moved toward the 5 000 level which it reached on September 2 On October 20 it passed through the 6 000 mark and on November 2 it broke the 7 000 barrier barely two weeks later it s topped 8 000 And there s still more than a month to go before the close of 2017
While this may sound like a fairy tale and it surely must be for early Bitcoin investors one should always keep in mind the oft repeated disclaimer popular in financial literature past performance is not indicative of future results Since this is largely a sentiment driven market it s highly unpredictable Like Facebook NASDAQ FB and eBay NASDAQ EBAY previously which didn t start as businesses by happy accident they all turned into some of the most successful ventures in history That s a lot riding on happy accident
We ve tried to use the principles of technical analysis to forecast future BTC moves but didn t succeed Still based on studying the digital currency s balance of supply and demand posting a price higher than a previous peak signals a resumption of an uptrend whereupon a long trade may be entered
WTI crude held on to gains above 56 after Friday s surge which was spurred by Saudi Arabia s supply cut extension plans In yesterday s Week Ahead post we indicated that WTI s price had formed a weekly hanging man When it s confirmed with a following closing price beneath the hanging man s real body it suggests a decline will ensue Thus far the price is 3 cents below as of 4 53 AM
Up Ahead
Federal Reserve Chair Janet Yellen gives a talk at New York University on Tuesday
Reports on sales of previously owned homes and durable goods orders for October are due in the U S on Tuesday and Wednesday respectively
The minutes from the Fed s latest policy meeting are out on Wednesday Market participants will get a fresh read on Fed officials eagerness to boost the benchmark interest rate in December something widely expected by markets
On Tuesday US but early Wednesday Asia Taiwan updates on October unemployment and Hong Kong s October CPI is out Singapore s 3Q GDP is due on Thursday New Zealand s October Trade and South Korea s November Consumer Confidence figures are also due out later in the week
The U K releases its budget Wednesday Great Britain could see a significant economic downgrade amid a continued impasse in its negotiations with the EU on Brexit
Market Moves
Stocks
The Stoxx Europe 600 Index dipped less than 0 05 percent as of 8 45 a m London time
The U K s FTSE 100 fell 0 4 percent to its lowest in more than seven weeks
Germany s DAX sank 0 2 percent to the lowest in almost four weeks
Japan s Nikkei 225 decreased by 0 6 percent
The MSCI Asia Pacific Index declined 0 1 percent
The MSCI Emerging Markets rose 0 1 percent to the highest in more than six years
S P 500 Futures decreased 0 2 percent to 2 572 00
Currencies
The Dollar Index dipped 0 02 percent paring a 39 percent gain
The euro rose 0 1 percent to 1 1798 the strongest in almost four weeks
The British pound climbed 0 4 percent to 1 3264 the strongest in almost three weeks
The Japanese yen declined less than 0 05 percent to 112 13 per dollar
Bonds
The yield on 10 year Treasuries fell one basis point to 2 34 percent
Germany s 10 year yield increased less than one basis point to 0 36 percent
Britain s 10 year yield climbed one basis point to 1 309 percent
Japan s 10 year yield increased less than one basis point to 0 038 percent
Commodities
West Texas Intermediate crude gained 0 1 percent to 56 62 a barrel the highest in a week
Gold dipped less than 0 05 percent to 1 291 81 an ounce
Copper fell 0 3 percent to 3 08 a pound |
WFC | Wells Fargo wholesale exec making exit | Richard Yorke chief operating officer of the key wholesale business at Wells Fargo NYSE WFC is leaving the bank in August The Wall Street Journal reports The wholesale division contributes about half of Wells Fargo s overall profit Yorke also oversaw the bank s international group that group until mid 2017 had oversight of a foreign exchange business under investigation the WSJ notes Now read |
WFC | Air India seeks additional equity from government to pay vendors source | By Aditi Shah and Abinaya Vijayaraghavan Reuters State owned carrier Air India has sought 21 21 billion rupees 309 million of additional equity from the government for the fiscal year 2018 19 to make pending payments to its vendors a source at the airline told Reuters on Monday Air India owes about 18 billion rupees to its vendors including lessors and banks that have demanded payment from the beleaguered airline after the government s unsuccessful efforts to find a buyer for its 76 percent stake The airline expects to receive the additional equity within the next 7 to 10 days after which it will be able to clear all dues the source said adding that this is above the 6 5 billion rupees it has already received for the year India last month shelved a plan to sell a majority stake in Air India due to lack of interest from bidders in the latest setback in its ambitious efforts to rescue the ailing airline that has survived for years using taxpayer funds The government will continue to support the loss making airline s financial requirements while it works on alternatives Junior Civil Aviation Minister Jayant Sinha had said without giving a specific timeline for a new plan Three banks and two aircraft leasing firms have served default notices on Air India over the last few weeks the Business Standard newspaper reported earlier on Monday raising concerns about the state owned carrier s finances and credit worthiness San Francisco United States based Wells Fargo NYSE WFC Trust Services and UAE s state owned Dubai Aerospace Enterprise DAE have sent letters of demand for pending rental payments the newspaper said citing sources A DAE spokesman told Reuters that they were not owed 10 million by Alliance Air and that they had not issued a notice of default to Alliance Alliance Air is a unit of Air India that operates regional flights to smaller towns and cities in India Wells Fargo could not be reached outside usual U S business hours Three lenders from a 22 bank consortium have also written to Air India raising concerns that the company is turning into a non performing asset Business Standard said The three banks are Standard Chartered LON STAN Bank Dena Bank NS DENA and Bank of India Ltd NS BOI The airline has received a notice from banks for non payment of dues that is being looked into by the government the source confirmed A Standard Chartered spokesman in India declined to comment Bank of India and Dena Bank did not immediately respond to requests for comment |
WFC | Preferred Apartment buys 29 story office tower in Raleigh NC | Preferred Apartment Communities NYSEMKT APTS acquires Wells Fargo NYSE WFC Capitol Center a 559 591 square foot 29 story office tower in Raleigh NC s central business district The transaction was financed with a non recourse first mortgage loan for 114 4M bearing interest at a fixed rate of 4 27 per year it has a 10 year term and amortizes beginning in year three based on a 30 year schedule No loan guarantees were provided by Preferred Apartment or its operating partnership The transaction increases Preferred Apartment s office portfolio to six assets totaling about 2 1M square feet Source Press ReleasePreviously Preferred Apartment Q2 reflects focus on results at property level July 30 Now read |
WFC | Cryptocurrencies Prices Plunge Binance Acquires Trust Wallet | Investing com Cryptocurrencies prices continued to dive on Wednesday after hitting its one week low in the previous session Binance the second largest cryptocurrency exchange by volume announced its acquisition of the Trust Wallet on Tuesday
Bitcoin was down 7 72 from the last 24 hours to 7 538 at 1 02AM ET 05 02 GMT on the Bitifinex exchange
Ethereum also plunged 9 42 to 415 52 on the Bitifinex exchange
Ripple fell 2 3 to 0 4301 on the Poloinex exchange while Litecoin traded at 77 306 down by 6 02 in the last 24 hours
Binance said on Tuesday that it acquired Trust Wallet a mobile wallet founded in 2017 that supports Ethereum and more than 20 000 different Ethereum based tokens The merge of an undisclosed amount is expected to improve Binance s services and safety for users according to some analysts
Trust Wallet founder Viktor Radchenko said that the company plans to also add support for other blockchains including Bitcoin in the future
In other news Coinbase one of the largest cryptocurrency exchanges in the U S hired the former global head of compliance at Pershing LLC Jeff Horowitz to be its chief compliance officer
Asiff Hirji Coinbase president said in a blog post that as Coinbase along with the cryptocurrency space as a whole grows and matures continued regulatory compliance across all the varying jurisdictions globally will be critical
Meanwhile reports suggested that confidence in cryptocurrency seemed to be growing in Australia as the government invested 1 6 million on Tuesday in a blockchain initiative to boost its sugar production industry which is estimated to be valued at 1 2 billion in 2016 17 The distributed ledger technology is expected to reduce costs increase efficiency and enhance transparency according to reports
However a survey from Gallup and commissioned by Wells Fargo NYSE WFC revealed that only 2 of investors in the U S own bitcoin and only 1 plan to investment in cryptocurrencies in the near future
Nobel Prize winner Paul Krugman is also skeptical about the development of cryptocurrencies In his column on The New York Times on Tuesday he said that a total collapse is a real possibility |
WFC | Wells Fargo s WFC Q1 Earnings Revenues Beat Estimates | Have you been eager to see how Wells Fargo Company NYSE WFC performed in Q1 in comparison with the market expectations Let s quickly scan through the key facts from this San Francisco based money center bank s earnings release this morning An Earnings BeatWells Fargo came out with earnings per share of 1 12 beating the Zacks Consensus Estimate of 1 07 Moreover results were up from the prior year quarter earnings of 1 03 Results were benefitted from lower provisions and higher interest income partially offset by elevated interest expense and non interest expenses Notably results are preliminary which might be impacted on resolution of matters with Consumer Financial Protection Bureau CFPB and Office of the Comptroller of the Currency OCC related to the bank s compliance risk management program with a charge of 1 billion in civil money penalties How Was the Estimate Revision Trend You should note that the earnings estimate for Wells Fargo depicted neutral stance prior to the earnings release The Zacks Consensus Estimate has remained unchanged over the last seven days Wells Fargo has a decent earnings surprise history Before posting earnings beat in Q1 the company delivered positive surprises in two of the prior four quarters Overall the company surpassed the Zacks Consensus Estimate by an average of 0 32 in the trailing four quarters Wells Fargo Company Price and EPS Surprise Revenue Came In Higher Than Expected Wells Fargo posted revenues of 21 9 billion outpacing the Zacks Consensus Estimate of 21 7 billion Yet revenues decreased from 22 3 billion in the year ago quarter Key Stats to Note
Pre tax pre provision profit PTPP 7 7 billionROA net income to average assets 1 26 ROE net income applicable to common stock to shareholders equity 12 37 What Zacks Rank SaysThe estimate revisions that we discussed earlier have driven a Zacks Rank 3 Hold for Wells Fargo However since the latest earnings performance is yet to be reflected in the estimate revisions the rank is subject to change While things apparently look favorable it all depends on what sense the just released report makes to the analysts You can see How the Market Reacted So FarFollowing the earnings release Wells Fargo shares were up more than 1 in the pre trading session This is in line with what the stock witnessed in the prior day s session Clearly the initial reaction shows that the investors have considered the results in their favor However the full session s price movement may indicate a different picture Check back later for our full write up on this Wells Fargo earnings report later Will You Make a Fortune on the Shift to Electric Cars Here s another stock idea to consider Much like petroleum 150 years ago lithium power may soon shake the world creating millionaires and reshaping geo politics Soon electric vehicles EVs may be cheaper than gas guzzlers Some are already reaching 265 miles on a single charge With battery prices plummeting and charging stations set to multiply one company stands out as the 1 stock to buy according to Zacks research It s not the one you think |
EBAY | Price match guarantee launched by eBay | EBay EBAY 0 1 announces that it launched a price match guarantee on more than 50K deals in the U S The vast majority of our deals are already lower priced or equal to our competitors but if a shopper finds it for less we ll gladly match the price of our competitors says eBay exec Hal Lawton Numbers check eBay has 169 million active buyers worldwide 87 of GMV on eBay is fixed price 1 1 billion listings are available at any given time 80 of merchandise sold on eBay is new 2 3 of eBay packages are delivered within 3 days or less eBay apps have been downloaded 349 million times across the globe Source Press Release Now read |
WFC | Wells Fargo in process of refunding customers for add on products WSJ | Reuters Wells Fargo Co N WFC is in the process of refunding millions of dollars to customers for adding services to their accounts without their full understanding the Wall Street Journal reported on Thursday citing sources Wells Fargo charged monthly fees for these products ranging from pet insurance to legal services that customers did not fully understand the Journal reported citing people familiar with the matter The Consumer Financial Protection Bureau is probing the matter according to the report Wells Fargo said in its latest quarterly filing that there was an ongoing review of add on products across the company adding it had started remediation efforts where it had identified impacted customers The lender has been trying to recover from a sales scandal for close to two years now
It has acknowledged opening millions of accounts in customers names without their permission signing others up for unwanted auto insurance charging some for a mortgage rate lock feature they did not request and tacking other costly add ons to accounts |
WFC | Wells Fargo looks to sell its Eastdil Secured real estate division Wall Street Journal | Reuters Wells Fargo Co N WFC is exploring a sale of its Eastdil Secured real estate division the Wall Street Journal reported on Thursday citing people familiar with the matter The U S bank has been weighing a sale of Eastdil which provides financial advisory services to real estate owners for at least a few months now the Journal said Wells Fargo is hoping the division will draw the attention of private equity firms for a deal the Journal reported The report did not clarify how much Eastdil may be worth Eastdil Secured is present in 11 states in the United States two countries in Europe and two in Asia according its website
Wells Fargo which bought Eastdil in 1999 was not immediately available for comment |
WFC | Wells Fargo apologizes to customers for recent account problems | NEW YORK Reuters Wells Fargo Co N WFC apologized on Friday to customers who were having issues with their bank accounts after getting a stream of complaints on social media about checks not clearing or mobile deposits not working We apologize to our customers who may be experiencing an issue with certain types of transactions Wells Fargo s Twitter account posted Thanks for your patience while we research this issue If you are impacted please check back here for updates
A representative did not immediately respond to a request for comment about the type and extent of account issues reported by customers |
WFC | Wells Fargo wealth management sales goals reported to be focus of probe WSJ | Wells Fargo NYSE WFC financial advisers at the bank s wealth management business allegedly pushed clients into products that generated more fees and sometimes moved client assets between different products or investing platforms to generate more revenue and larger bonuses the Wall Street Journal reports citing more than 24 former employees and documents A Wells Fargo spokeswoman told the WSJ that the bank is thoroughly reviewing the wealth and investment management business and is making significant progress in identifying and fixing any issues The U S Department of Justice and the U S Securities and Exchange Commission are investigating allegations made by six Wells Fargo financial advisers since September Previously Wells Fargo is said to pressure high net worth wealth managers to focus on sales Yahoo NASDAQ AABA Finance July 18 Now read |
EBAY | EU to launch more e commerce antitrust investigations | By Julia Fioretti BRUSSELS Reuters The European Union plans to launch more antitrust investigations into e commerce companies after a two year inquiry uncovered business practices that restrict competition the European Commission said on Wednesday In its report on the initial inquiry the EU executive said it had found an increased use of contractual restrictions to control product distribution which could be in breach of EU antitrust rules Certain practices by companies in e commerce markets may restrict competition by unduly limiting how products are distributed throughout the EU Competition Commissioner Margrethe Vestager said in a statement The e commerce sector inquiry is part of the European Commission s campaign to overhaul the bloc s digital market in a bid to boost growth and catch up with the United States and Asia The Commission collected about 8 000 distribution and license agreements and gathered information from retailers manufacturers price comparison websites e commerce platforms and providers of films sports fiction TV and music The insight gained from the sector inquiry will enable the Commission to target EU antitrust enforcement in European e commerce markets which will include opening further antitrust investigations the Commission said The EU executive found that manufacturers increasingly use selective distribution systems where products can only be sold by pre authorized sellers giving them more control over distribution price and brand image Almost half of the manufacturers using selective distribution systems blocked pure online retailers such as eBay Inc O EBAY from selling their products The online shopping platform welcomed the report and encouraged the Commission to launch targeted investigations The report also shows that marketplace bans prevent a significant number of small business entrepreneurs from selling products on online marketplaces and that these bans harm consumers by limiting choice increasing prices and hindering cross border trade said Paul Todd senior vice president for eBay in EMEA The report showed that almost 60 percent of providers of digital content such as music films and TV shows have agreed with the copyright holder to geoblock namely restricting consumers access to products and services based on where they are located Some licensing practices may also make it more difficult for new online business models and services to emerge the Commission said It pointed to long term licensing agreements between rights holders and distributors as a possible barrier to new entrants
EU antitrust scrutiny of the pharmaceutical energy and financial services industries over the past decade prompted investigations into companies in all three sectors |
EBAY | Investment firms TPG Dragoneer reveal stake in Etsy | By Lauren Hirsch Reuters Investment firms TPG Group Holding Advisers Inc and Dragoneer Investment Group LLC jointly reported an 8 percent stake in Etsy Inc O ETSY the Brooklyn based online retailer of handmade goods Etsy disclosed in filings on Monday The disclosure comes just weeks after activist hedge fund Black and White Capital LP which owns roughly 2 percent of Etsy urged the company to explore a potential sale Etsy s shares have fallen more than 30 percent since their initial public offering IPO two years ago Etsy shares jumped more than 8 percent in after hours trading to 12 30 TPG has contacted representatives of Etsy to offer to engage in discussions regarding strategic alternatives it said in a filing with the U S Securities and Exchange Commission where it disclosed a 4 3 percent stake Dragoneer has a 3 7 percent stake We are now reviewing our strategic and operational plans to ensure Etsy is focused on the most value enhancing near and long term opportunities Etsy s CEO Josh Silverman said in a statement in response to the filings on Monday Silverman a former eBay Inc O EBAY executive was appointed CEO two weeks ago He took the role from Chairman and CEO Chad Dickerson who stepped down after nine years in the seat The role of chairman went to Etsy board director Fred Wilson Etsy was a darling of the artisanal set at the time of its IPO but it has struggled as sales have slowed and new channels such as Facebook Inc s O FB Instagram Inc have created alternative platforms for the independent sellers Etsy caters to The company has also had to pour more money into marketing after years of being able to rely on word of mouth Etsy which reported a net loss of 421 000 this quarter announced it is laying off 80 people roughly 8 percent of its workforce earlier this month It is not uncommon for private equity firms to do so called toehold investments for reasons that include long term investing and getting to know management While such investments can sometimes morph into deals as with Leonard Green Partners LP s investment in BJ s Wholesale Club Inc they often do not
Dragoneer an early stage investor in Etsy has worked with TPG before including its investment in music streaming service Spotify Ltd |
EBAY | EBay Revenues Beat Estimates Stock Slumps On Soft Guidance | eBay Inc NASDAQ EBAY just released its third quarter 2017 financial results posting earnings of 48 cents per share and revenues of 2 4 billion Currently EBAY is a Zacks Rank 4 Sell and is down 4 95 to 36 09 per share in after hours trading shortly after its earnings report was released
eBay
Matched earnings estimates The company posted earnings of 48 cents per share missing the Zacks Consensus Estimate of 48 cents
Beat revenue estimates The company saw revenue figures of 2 41 billion beating our consensus estimate of 2 37 billion
On a year over year basis eBay s net revenues climbed 9 while its earnings per share gained 7 Non GAAP net income was up 1 to 514 million GAAP operating margin decreased to 24 0 from 24 4 in the prior year quarter and non GAAP operating margin decreased to 29 6 from 29 9 Gross merchandise volume in the quarter was 21 7 billion an increase of 8 year over year
eBay s Marketplace generated about 20 5 billion of gross merchandising volume and 1 9 billion in revenue The company s StubHub ticket resale platform generated 1 2 billion of gross merchandising volume and 275 million in revenue
In Q3 we drove acceleration across all three of our platforms delivering strong top and bottom line financial results and our fastest volume growth in over three years said CEO Devin Wenig Our customers are responding to the significant product enhancements we have been making and this is reflected in our results
The company expects Q4 revenue in the range of 2 58 billion and 2 62 billion while GAAP earnings are expected to fall between 0 40 0 45 and non GAAP earnings are projected to land between 0 57 0 59 This is on the low end of our current Zacks Consensus Estimate which is calling for earnings of 59 cents per share
Here s a graph that looks at eBay s earnings surprise history eBay Inc Price Consensus and EPS Surprise eBay is one of the world s largest online trading communities eBay creates a powerful marketplace for the sale of goods and services by a passionate community of individuals and small businesses eBay enables trade on a local national and international basis with local sites in numerous markets
Check back later for our full analysis on eBay s latest earnings report
Want more stock market analysis from this author Make sure to follow on Twitter
The Hottest Tech Mega Trend of All
Last year it generated 8 billion in global revenues By 2020 it s predicted to blast through the roof to 47 billion Famed investor Mark Cuban says it will produce the world s first trillionaires but that should still leave plenty of money for regular investors who make the right trades early |
EBAY | EBay EBAY Q3 Earnings Match Estimates Revenues Beat | eBay Inc NASDAQ EBAY reported decent third quarter 2017 results with earnings matching the Zacks Consensus Estimate and revenues beating the same by a slight margin Pro forma earnings of 48 cents improved 6 7 year over year Gross revenues of 2 41 billion were up 8 7 on a year over year basis up 8 on an Fx neutral basis and came ahead of the guided range Both top and bottom line growth was driven by strength across all three platforms Marketplace Classifieds and StubHub in the United States and internationally Shares however fell 5 9 in after hours trading in response to the company s weaker than expected fourth quarter as well as annual earnings outlook At the call management appeared impressed with the progress of the company transforming itself and the positive response of customers eBay is leveraging on its structured data and Artificial Intelligence AI strength to build product catalogs enhance mobile platform roll out new browse inspired shopping journeys enhance customer to customer C2C business and strengthen its brand It accelerated its AI efforts through structured data personalization image search technology and customer support effort in several areas In the third quarter eBay rolled out group listings a new way of searching that enables users to organize search results by products rather than listing It partnered with Spring to offer a wide range of apparel and accessories through ebay com It has also extended its price matching program to international markets eBay will soon launch Guaranteed Delivery program on 20 million items that arrive in three business days or less Overall we remain positive on eBay s replatforming and brand enhancement initiatives Its unique capabilities backed by technological improvements give it an edge over competitors such as Etsy NASDAQ ETSY Alibaba NYSE BABA and Facebook NASDAQ FB However expected results may take some time to show up due to weak global economy slow e commerce growth and increasing competition Year to date the stock has underperformed its industry gaining only 27 9 compared with the gain of 52 7 Let s delve deeper into the numbersRevenues and GMVIn the third quarter the Marketplace platform contributed 20 5 billion of gross merchandise volume GMV and 1 9 billion of revenues Marketplace GMV grew 9 year over year on a reported basis and 7 on an FX Neutral basis StubHub made a contribution of 1 2 billion of GMV up 2 on a year over year basis and revenues of 275 million up 5 year over year eBay Inc Revenue TTM Classifieds platforms also performed well with contribution of 235 million of revenues up 19 year over year on a reported basis and 13 on an FX Neutral basis GMV of 21 7 million grew 8 year over year on a reported basis and 7 on an Fx neutral basis GMV growth was fastest since 2014 Active buyers customers increased 5 from the year ago quarter to 168 million This figure excludes domestic active buyers in India that eBay is no longer reporting after the sale of its India business to Flipkart Margins and IncomePro forma gross margin for the quarter was 77 2 down 64 basis points bps year over year but up 101 bps sequentially Cost of revenues increased 11 6 on a year over year basis primarily due to first party inventory program in Korea Adjusted operating expenses of 1 1 billion decreased 1 9 from the prior year quarter and 10 7 sequentially Pro forma operating margin was 29 6 down 30 bps year over year but up 230 bps sequentially GAAP net income was 523 million 48 cents per share compared with 418 million 36 cents per share in the year ago quarter Balance Sheet and Cash FloweBay s balance sheet is highly leveraged with total debt of 10 billion eclipsing cash and short term investments balance of 6 billion The company generated 877 million in cash from operating activities and spent 157 million on capex Share repurchases were 907 million in the quarter OutlookFor the fourth quarter of 2017 eBay expects revenues to grow 6 8 on an Fx neutral basis to 2 58 billion 2 62 billion better than the Zacks Consensus Estimate of 2 57 billion Non GAAP earnings are expected within 57 cents 59 cents The mid point of the range is lower than the Zacks Consensus Estimate of 59 cents GAAP earnings per share from continuing operations are expected in the range of 40 cents 45 cents eBay revised its full year guidance The company now expects full year revenues between 9 53 billion and 9 57 billion up from its previous range of 9 3 billion to 9 5 billion and better than the Zacks Consensus Estimate of 9 49 Adjusted earnings per share are expected between 1 99 and 2 01 compared with its previous range of 1 98 to 2 03 The Zacks Consensus Estimate is pegged at 2 01 Zacks RankCurrently eBay carries a Zacks Rank 4 Sell You can see Today s Stocks from Zacks Hottest StrategiesIt s hard to believe even for us at Zacks But while the market gained 18 8 from 2016 Q1 2017 our top stock picking screens have returned 157 0 128 0 97 8 94 7 and 90 2 respectively And this outperformance has not just been a recent phenomenon Over the years it has been remarkably consistent From 2000 Q1 2017 the composite yearly average gain for these strategies has beaten the market more than 11X over Maybe even more remarkable is the fact that we re willing to share their latest stocks with you without cost or obligation |
Subsets and Splits
No saved queries yet
Save your SQL queries to embed, download, and access them later. Queries will appear here once saved.