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WFC | Wells Fargo Files Patent for Tokenization System to Protect Sensitive Data | San Francisco based bank Wells Fargo NYSE WFC has outlined a patent for a tokenization system that would protect data according to a filing published by the U S Patent and Trademark Office USPTO July 17
The newly published application details a system in which any type of data element whether a document graphic or database value could be located accessed and protected by means of tokenization |
EBAY | EBay finds material weakness in controls over accounting for tax | Reuters EBay Inc O EBAY said on Monday it had found that it improperly accounted for tax on certain transactions completed in December which constituted a material weakness in its internal control over financial reporting However eBay said it would not have to restate financial results for any prior period due to the issue which impacted the deferred tax asset and income tax benefit accounts
The company said it plans to implement certain reviews and documentation standards by the first quarter and expects to remedy the issue by the end of this year |
WFC | Wells Fargo Company Falls 3 09 As Investors Eye Earnings | Investing com Wells Fargo NYSE WFC Company fell by 3 09 to trade at 54 30 by 09 40 13 40 GMT on Friday on the NYSE exchange down 3 09 on the day The volume of Wells Fargo Company shares traded since the start of the session was 3 79M
Wells Fargo Company has traded in a range of 54 27 to 55 08 on the day The stock has traded at 57 08 at its highest and 54 29 at its lowest during the past seven days |
WFC | Wells Fargo Struggles To Regain A Foothold | Wells Fargo NYSE WFC is struggling to re enter its long term upward trending Andrew s Pitchfork channel as shown on the following monthly chart of WFC
The momentum indicator has fallen below the zero level on this timeframe and has formed a lower swing low hinting of further weakness ahead And as I mentioned in this major support is at 50 00 so a break and hold below would likely see price retest the October 2016 lows or drop lower
UPDATE at close WFC continued its intraday drop and closed near its low of the day at 52 26
And this report just out doesn t bode well for a sustainable rally any time soon |
EBAY | Facebook FB Plans To Expand Its Marketplace Offerings | Facebook NASDAQ FB announced plans to expand what types of products will be listed in its Craigslist like Marketplace including auto and ticket sales
Launched this past October Facebook Marketplace facilitates peer to peer shopping Using Facebook profiles users can find out more information about the person they re buying from or selling to while its integration with Facebook Messenger allows users to haggle prices and arrange meet ups
Facebook has previously limited posting in the Marketplace to individual pages If a user wanted to buy tickets or a specific item they would have to visit a company s shopping page Now Facebook is allowing businesses to enter the Marketplace directly
However Facebook doesn t know exactly which products people will want to buy so the social media giant will experiment with different offerings before moving into the most popular areas
We ll kind of look and see what s popular what people want to engage with said Deb Liu the Facebook VP who oversees Marketplace in an interview with So if people are searching or looking for something we want to make that available to them
One such area will be auto sales with Marketplace featuring local car dealerships Facebook also intends to integrate real estate listings
Facebook has not announced if it will be partnering with any specific companies in these areas But the company has already collaborated with eBay NASDAQ EBAY to offer Facebook users daily deals from eBay directly in Facebook s app so additional partnerships could happen in the future
Shares of Facebook closed the day up 0 30 on Friday at 167 41 per share
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EBAY | EBay Down 6 3 Since Earnings Report Can It Rebound | It has been about a month since the last earnings report for eBay Inc NASDAQ EBAY Shares have lost about 6 3 in that time frame underperforming the market
Will the recent negative trend continue leading up to the stock s next earnings release or is it due for a breakout Before we dive into how investors and analysts have reacted of late let s take a quick look at the most recent earnings report in order to get a better handle on the important catalysts eBay Q2 Earnings Miss Estimates Revenues Beat eBay s second quarter 2017 earnings of 0 34 per share missed the Zacks Consensus Estimate by 2 cents Revenues of 2 33 billion however beat the Zacks Consensus Estimate by a slight margin and came ahead of the guided range RevenuesGross revenues of 2 3 billion were up 4 4 on a y y basis up 7 on an Fx neutral basis In the second quarter the Marketplace platform contributed 20 5 billion of gross merchandise volume GMV and 1 9 billion of revenues Marketplace GMV grew 3 year over year on a reported basis and 6 on an FX Neutral basis StubHub also showed signs of accelerated growth with contribution of 1 billion of GMV down 5 on a y y basis and revenues of 236 million up 5 year over year Classifieds platforms also performed well with contribution of 219 million of revenues up 6 year over year on a reported basis and 11 on an FX Neutral basis Gross merchandise volume grew 3 year over year on a reported basis and 5 on an Fx neutral basis to 21 5 Active buyers customers increased 4 from the year ago quarter Margins and IncomePro forma gross margin for the quarter was 76 2 down 191 basis points bps year over year and 93 bps sequentially Cost of revenues increased 13 8 on a y y basis primarily due to expenses associated with TicketbiS operations incremental investments in customer support and the expansion of first party inventory program in Korea Adjusted operating expenses of 1 3 billion increased 5 9 from the prior year quarter and 11 9 sequentially Operating margin shrank 267 bps year over year and 430 bps sequentially to 21 GAAP net income was 27 million 0 02 per share compared with 437 million 0 38 per share in the year ago quarter Balance Sheet and Cash FloweBay s balance sheet is highly leveraged with total debt of 11 5 billion eclipsing cash and short term investments balance of 9 billion The company generated 699 million in cash from operating activities and spent 182 million on capex Share repurchases were 507 million in the quarter OutlookFor the third quarter of 2017 eBay expects revenues to grow 6 8 on an Fx neutral basis to 2 35 billion 2 39 billion Non GAAP earnings are expected within 0 46 0 48 GAAP earnings per share from continuing operations are expected in the range of 0 30 0 32 In 2017 eBay expects revenues to grow 6 on an Fx neutral basis to 9 3 billion 9 5 billion
How Have Estimates Been Moving Since Then
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions
eBay Inc Price and Consensus VGM Scores
At this time eBay s stock has a poor Growth Score of F a grade with the same score on the momentum front 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 F If you aren t focused on one strategy this score is the one you should be interested in
Our style scores indicate investors will probably be better served looking elsewhere
Outlook
The stock has a Zacks Rank 3 Hold We expect in line returns from the stock in the next few months |
EBAY | Stock In Focus eBay | OCTOBER This is one of the peculiarly dangerous months to speculate in stocks in The other are July January September April November May March June December August and February Mark Twain
There are two times in a man s life when he should not speculate when he can t afford it and when he can Mark Twain
Tradition technical analysis a discipline full of moving averages stochastics relative strength chart patterns and volume is largely inconsistent and opinion driven Bull and bears attempt to enter the trend through interpretation that s as much opinion art form as discipline experience and skill Successful trading investing focuses solely on discipline through the study of price volume and time Price volume and time define the message of the market
eBay Inc NASDAQ EBAY is a multinational e commerce corporation facilitating online consumer to consumer and business to consumer sales chart Ebay s trend a series of higher highs and higher lows defines a bullish trend Traditional technical analysis however fails to recognize and anticipate normal rhythms within the trend Traders and investors can profit from these oscillators
Trends generally breathe or oscillate up and down within broader secular trends The alignment between price and volume trends defined for subscriber in 40 key market in defines aligned impulses up and down and consolidations within a secular up trend that tradition technical analysis cannot reveal chart 2
Ebay s aligned up impulse has produced a current maximum and minimum annualized return profile of 23 449 and 0 0 means the trade has produced no drawdown since 1 17 17 Impressive The computer warns bulls tempted to chase a winning position that the last 16 aligned up impulse since 1999 averaged 30 weeks The current impulse is 32 weeks old |
WFC | Pfizer delays drug price hikes after talking with Trump | By Yasmeen Abutaleb and Michael Erman
WASHINGTON NEW YORK Reuters Pfizer Inc N PFE said on Tuesday it was deferring drug price increases for no more than six months after the company s chief executive officer had an extensive conversation with U S President Donald Trump
The rollback came a day after Trump took aim at Pfizer and other U S drugmakers for raising prices on some of their medicines saying in a tweet that they should be ashamed and that his administration would respond
Pfizer on Tuesday said it would defer price increases that went into effect on July 1 until the end of the year or until the president s drug pricing blueprint goes into effect whichever is sooner The company said it would return drug prices to their pre July 1 levels as soon as technically possible
On Tuesday Trump said in a tweet that Pfizer had agreed to roll back drug price hikes after he and U S Health and Human Services Secretary Alex Azar spoke with the company s CEO Ian Read
We applaud Pfizer for this decision and hope other companies do the same Trump who is traveling in Europe said in a tweet
Pfizer one of the largest pharmaceutical companies now likely will not raise drug prices until after the 2018 midterm elections in November That gives Trump who made lowering prescription drug prices a top 2016 presidential campaign issue a short term victory he can point to in the run up to the elections which are being closely watched to see if Trump s fellow Republicans will be able to maintain control of both the Senate and the House of Representatives
Pfizer raised list prices on around 40 medicines earlier this month Those include Viagra cholesterol drug Lipitor and arthritis treatment Xeljanz according to Wells Fargo NYSE WFC List prices do not include rebates and discounts drugmakers may offer
The Trump administration has not yet taken significant action to lower drug prices Azar has said lowering prices long term will take years because of the complexity of the healthcare system
Trump rolled out a blueprint in May on how his administration planned to lower drug prices Trump said in May that some drug companies would announce voluntary massive price decreases in two weeks though none have materialized yet
Pharmaceutical company shares rose after Trump unveiled his drug pricing blueprint
Azar praised Pfizer on Tuesday I commend Pfizer for its constructive and professional approach and its desire to work with President Trump to be part of the solution and not part of the problem he said in a statement |
WFC | Poll Investors Optimistic But Wary of Extended Market Volatility | investing com It s been a volatile year for the U S stock market but investors remain largely positive about the investment climate even if they expect more volatility to come according to a new poll The Wells Fargo NYSE WFC Gallup Investor Optimism Index hit 103 in the second quarter Though that s down from a 117 reading in the first quarter it s the sixth straight quarter that the index was over 100 Despite the overall optimism 55 of investors were either somewhat or very concerned about future market volatility Only 5 had no concern What s more a high percentage of investors expect volatility to continue in 2018 with the worst of it yet to come Investors were concerned with other issues as well according to the poll The biggest concern was the political climate in Washington Almost eight of 10 surveyed were either very or somewhat concerned Concern about the size of the federal budget deficit was a close second The least source of worry for investors was the economy About 50 expressed some degree of concern |
WFC | What Is Tether USDT A Stablecoin Fully Backed by US Dollars Some Think Not | was first launched in July 2014 under the name Realcoin A few months later in November Realcoin was rebranded to Tether in order to avoid association with other altcoins
What is Tether and why it was created
Tether is a cryptocurrency claimed to be one to one pegged to the US dollar issued by a private company called Tether Limited Its creators claim that every USDT token in circulation is backed by a dollar in the bank The ultimate goal of Tether is to bring stability in the crypto world and provide an easier way for people to get in and out of a position
There is a huge demand for such a service in the crypto space It is extremely useful for most exchanges because they can use Tether and not deal with fiat currencies avoiding some legal headaches
For instance if market volatility is going crazy people can easily convert their cryptocurrencies into USDT and stay calm on the sidelines until they feel confident enough to enter a long position again In addition Tether allows traders to move money between crypto exchanges rather than using bank wire transfers
In theory anyone who holds USDT has nothing to worry about because at any given time Tether tokens can be redeemed for real US dollars
Controversy
There are however some aspects of Tether which anyone who is holding USDT should be familiar with
First the state of Tether s reserve has been a subject of controversy for months The company claims that one USDT in circulation is backed by one dollar in their bank account and it will be like this forever However there aren t many significant proofs that this is true
In June 2018 Tether finally published a third party report which declared that as of June 1 2018 the USDT circulating supply is even less than company s bank accounts balances which stood at USD 2 55 billion In other words the report claimed that everything is fine the money is there there is nothing to worry about
However this couldn t manage to settle the debate in the crypto community
The report was prepared by a law firm called Freeh Sporkin Sullivan FSS but it wasn t a full audit Eventually FSS maintains that all Tethers in circulation as of June 1 2018 are fully backed by existing USD reserves
However the firm also states that FSS has not performed any procedures or made any conclusions for activity prior to or subsequent to June 1st 2018 which means that those were the balances just for that particular day
Even Tether s general counsel Stuart Hoegner has admitted that this was not a full audit because the barriers to getting audited are simply too big to overcome for the moment Until Tether doesn t produce an independent audit no one can be absolutely certain that it is reserved 1 for 1
Second when you convert your coins to USDT you basically trust that a private company will turn your tokens into cash when you want so However as a private company Tether Limited has its own and part of that documentation states that Tether reserves the right to refuse to issue or redeem Tether Tokens if there is some sort of violation of their service
For many people this sounds like a potential risk that Tether might use their terms of service to create a reason not to allow a user to redeem their USDT
Another controversial issue with Tether is its link to crypto exchange Bitfinex The managers who run both companies are the same The CEO is JL van der Velde CFO is Giancarlo Devasini and CSO until June 2018 when he resigned was Phil Potter
The problem is that until November both companies insisted that the two operations were separate However leaked documents dubbed Paradise Papers revealed Bitfinex and Tether are run by the same individuals
The Omni Protocol the technology behind Tether
Originally Tether was using the Mastercoin protocol but since 2015 it was rebranded to Omni Protocol Omni consists of three layers
The first one is the Bitcoin blockchain where the Tether transaction ledger is embedded
The second is the Omni Layer Protocol which basically offers new rules without changing the foundation of Bitcoin It has three main functions
to allow the creation and destruction of digital tokens on the Bitcoin blockchain
to track and report the current circulation of USDT
to enable users to transact and store Tethers and other assets tokens
The Omni protocol was originally specified to embed data using fake Bitcoin addresses but it later came up with a friendlier message that embeds the data in a multi signature transaction instead
The final layer is Tether Limited the business entity whose responsibilities are to control the creation and revocation of USDT to report publicly the Proof of Reserves and to manage the technology behind Tether in order to increase its adoption
Tether vs TrueUSD
In terms of market value and adoption we may say that Tether doesn t have significant competitors being the 10th biggest cryptocurrency ranked by market capitalization Probably the only competitor worth mentioning is TrueUSD TUSD which is also a stablecoin backed 1 for 1 for US dollars TrueUSD is built on the TrustToken Platform where you can easily create asset backed tokens As of July 2018 it has only 79 million TUSD in circulation Compared to Tether s 2 6 billion this is quite irrelevant
Nevertheless TUSD is already available on some of the biggest exchanges like Binance and Bittrex so it may increase its adoption in the future
USDT manages to stay stable
USDT is trading since March 2015 and we may say that Tether is pretty much accomplishing its goal to be a During most of the time of its existence the value of 1 USDT is hovering around 1 One of the bigger deviations was in April 2017 when the value of 1 USDT fell to 0 913 in less than a week This is the current all time low of USDT
The reason for this drop was that Bitfinex s international wires had been cut off by Wells Fargo NYSE WFC and the Taiwanese bank the exchange was partnering with Back then there was a lot of uncertainty whether the money from Tether accounts could be withdrawn and as a result many people were willing to sell their USDT for less than one dollar per coin
On the upside when cryptocurrency prices dropped at the end of May 2017 more people wanted to use Tether in order to enter a position The increased demand resulted in a spike of Tether s value On May 27 2017 the USDT price reached USD 1 19 which is its current all time high
The increased circulating supply fueled the controversy
Being a stablecoin where every unit of USDT should be backed by a US dollar it is probably far more interesting to see the evolution of the circulating supply of Tether than its price development
The circulating supply of Tether is the reason why this cryptocurrency became one of the most controversial projects in the space
We ve seen a dramatic rise in the total amount of USDT in circulation It spiked from 60 million in May 2017 to 440 million in September the same year However the subsequent run from 450 million in November to 2 2 billion in January 2018 was even more impressive As of July 2018 the total number of USDT in circulation is 2 6 billion
The increasing market capitalization of Tether resulted in increasing speculation regarding its legitimacy Reasonably more people started to doubt Tether s statements that all those newly created coins are backed by actual cash because there wasn t any audit to support those numbers
What is the long term potential of Tether
There is a strong need for a coin like Tether in the crypto market It is extremely useful to have a cryptocurrency which is not supposed to fluctuate in price However at the moment I don t think there is a trustless way to prove that Tether or any other similar coin is fully backed by US dollars
All those speculations that the team behind USDT is the same who runs one of the largest cryptocurrency exchanges in the world as well as the facts surrounding Tether make this project not very reliable to me If those rumors are true this basically means that a few people can buy steal a significant percentage of a big cryptocurrency project by creating monopoly money
In my opinion holding your capital in USDT exposes you to even higher risk than just holding your money on an exchange The main purpose people use Tether is to make trading easier on the biggest exchanges
However cryptocurrencies are meant to be decentralized and to eliminate the middlemen not to increase them If you hold USDT on an exchange first you risk losing your money if the exchange gets hacked and second you add more risk to lose your investment if something happens to the private company creating and managing this cryptocurrency
If we are heading to a world where paper money will be obsolete how much time do you think will pass before the US government takes action against a private company basically claiming that it is creating digital dollars
I personally don t see long term potential in Tether In my opinion the more its market cap grows the sooner the bubble will burst
I believe we will get to the point where most national currencies will have their blockchain representation If this happens the need for coins like Tether will be pretty much eliminated
Disclaimer The views and opinions expressed by the contributor in this text should not be considered financial or investment advice neither treated as an expression of Cryptovest s view Neither the author nor the publication takes any responsibility or liability for any investments profits or losses you may incur as a result of this information
Cryptocurrency trading and investing is risky and market participants are advised to always conduct a thorough research |
WFC | Wells Fargo starts Arris at 23 upside | Wells Fargo NYSE WFC starts Arris NASDAQ ARRS at Outperform with a 32 price target a 23 upside to yesterday s close Source Bloomberg First Word Arris shares are down 0 04 premarket to 25 97 Now read |
WFC | An Early Preview Of Wells Fargo s WFC Q1 Earnings Outlook | Shares of Wells Fargo NYSE WFC surged near the end of last year and this momentum carried over into the early part of 2018 Then in early February Wells Fargo saw its stock price tumble along with many other companies Now amid this newly volatile market investors might be even more focused on Wells Fargo s upcoming Q1 financial results
Wells Fargo s very public and serious business related scandals including its massive fake account fiasco caused some damage to its reputation and its stock price over the last year These self inflicted wounds might still taint how outsiders and investors perceive the company But the real question is does the perception of Wells Fargo correspond with its current first quarter earnings outlook
With that said let s take a look at what to expect from Wells Fargo s upcoming Q1 financial results to see if the embattled banking power seems poised to turn things around
Latest Outlook and Valuation
Wells Fargo s first quarter revenues are expected to dip by 1 5 to hit 21 67 billion based on our current Zacks Consensus Estimates Meanwhile the bank is projected to see its earnings climb by 6 to reach 1 06 per share
However Wells Fargo s earnings estimate revision activity has been mixed recently The company has earned two upward earnings estimate revisions and six downward revisions all within the last 60 days These revisions lowered Wells Fargo s consensus earnings estimate by 2 cents
WFC is currently trading with a Forward P E of 10 6 This marks a discount compared to the Banks Major Regional industry which is currently trading at an average of 11 6x forward earnings
This also marks a discount compared to where Wells Fargo was trading at just a few months ago Wells Fargo s newly discounted valuation can be attributed for the most part to its recently declining stock price which far outpaces its industry s dip
Most Recent Results
Wells Fargo posted adjusted earnings of 0 97 per share in the fourth quarter which fell short of our Zacks Consensus Estimate that called for EPS of 1 04 The company reported revenues of 22 1 billion which just missed our 22 4 billion estimate
These results are no indication of what Wells Fargo might report going forward but they give investors some sense of how the company compared against estimates in its most recently reported quarter
Price Performance and Surprise History
Another important thing to consider ahead of Wells Fargo s Q1 report is the company s history of earnings surprises and the effect that these surprises have had on share prices Wells Fargo Company Price Consensus and EPS Surprise We can see that Wells Fargo has posted relatively strong results over the last couple of years It is also worth noting that Wells Fargo s stock has performed somewhat inconsistently following the release of its quarterly earnings results
For instance Wells Fargo stock surged in the immediate aftermath of an earnings miss last quarter while its stock price sank following a second quarter earnings beat
Bottom Line
Past performance does not always guarantee future success And we can see that Wells Fargo s price performance has been a bit harder to gauge over its recent scandal ridden stretch
Investors should remember that the bank s bottom line is projected to expand in the first quarter and note that Wells Fargo is currently a Zacks Rank 3 Hold
Wells Fargo is scheduled to report its first quarter 2018 financial results before markets open on Friday April 13
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 | Facebook launches Marketplace and shares in eBay tumble 3 | Investing com Shares of eBay were down more than 3 in pre market trade on Monday as Facebook introduced a new section that could compete with the online sales firm
According to Facebook s director of product management Mary Ku over 450 million of its users already visit buy and sell groups each month
Hence the strategy was to create the section called Marketplace which Ku defined as a convenient destination to discover buy and sell items with people in your community
Facebook said that the Marketplace will roll out to everyone over 18 years old on its app for iPhone and Android in the U S U K Australia and New Zealand in the next few days
We will continue expanding to additional countries and make Marketplace available on the desktop version of Facebook in the coming months it said
While shares of Facebook Inc NASDAQ FB saw little movement in pre market trade eBay Inc NASDAQ EBAY seemed to suffer from speculation over the impact from increased competition and tumbled 3 65 to 31 70 at 9 07AM ET 13 08GMT |
EBAY | EBay EBAY Q2 Earnings Miss Estimates Revenues Beat | eBay Inc s NASDAQ EBAY second quarter 2017 earnings of 34 cents per share missed the Zacks Consensus Estimate by 2 cents Shares fell 5 19 in after hours trading in response to the earnings miss
Adjusted earnings per share exclude one time items but include stock based compensation expense
In the quarter increase in cost of revenues and operating expenses predominantly sales and marketing weighed on eBay s bottom line
Revenues of 2 33 billion however beat the Zacks Consensus Estimate by a slight margin and came ahead of the guided range
Revenue growth was driven by strength in international markets increase in active buyers expansion of new user experience and brand advertising eBay added 2 million active buyers in the second quarter taking the total to 171 million
Management appeared to be impressed with the progress of replatforming efforts The company continues to strengthen its core platform and improve user experience The company accelerated its efforts by building product catalogs on structured data enhancing mobile platform rolling out new browse inspired shopping journeys rejuvenating customer to customer C2C business and strengthening its brand
In the second quarter eBay collaborated with Shopify to allow sellers to synchronize inventory information sell products ordered on eBay and view eBay buyer messages directly from Shopify accounts The company partnered with Disney to offer exclusive Pirates of the Caribbean merchandise It also rolled out nest and EGI as new brands on its platform eBay also has extended its price matching program to the U K The company s new home page has been expanded to eight geographies
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 underperformed its industry gaining only 22 5 compared with the gain of 48 4
Let s delve deeper into the numbers
Revenues
Gross revenues of 2 3 billion were up 4 4 on a year over year basis up 7 on an Fx neutral basis In the second quarter the Marketplace platform contributed 20 5 billion of gross merchandise volume GMV and 1 9 billion of revenues Marketplace GMV grew 3 year over year on a reported basis and 6 on an FX Neutral basis StubHub also showed signs of accelerated growth with contribution of 1 billion of GMV down 5 on a year over year basis and revenues of 236 million up 5 year over year
Classifieds platforms also performed well with contribution of 219 million of revenues up 6 year over year on a reported basis and 11 on an FX Neutral basis
Gross merchandise volume grew 3 year over year on a reported basis and 5 on an Fx neutral basis to 21 5 Active buyers customers increased 4 from the year ago quarter
Margins and Income
Pro forma gross margin for the quarter was 76 2 down 191 basis points bps year over year and 93 bps sequentially
Cost of revenues increased 13 8 on a year over year basis primarily due to expenses associated with TicketbiS operations incremental investments in customer support and the expansion of first party inventory program in Korea
Adjusted operating expenses of 1 3 billion increased 5 9 from the prior year quarter and 11 9 sequentially Operating margin shrank 267 bps year over year and 430 bps sequentially to 21
GAAP net income was 27 million 2 cents per share compared with 437 million 38 cents per share in the year ago quarter
eBay Inc Price Consensus and EPS Surprise
Balance Sheet and Cash Flow
eBay s balance sheet is highly leveraged with total debt of 11 5 billion eclipsing cash and short term investments balance of 9 billion The company generated 699 million in cash from operating activities and spent 182 million on capex Share repurchases were 507 million in the quarter
Outlook
For the third quarter of 2017 eBay expects revenues to grow 6 8 on an Fx neutral basis to 2 35 2 39 billion better than the Zacks Consensus Estimate of 2 32 billion Non GAAP earnings are expected within 46 48 cents The Zacks Consensus Estimate is pegged at 39 cents GAAP earnings per share from continuing operations are expected in the range of 30 32 cents
In 2017 eBay expects revenues to grow 6 8 on an Fx neutral basis to 9 3 9 5 billion
Zacks Rank
Currently eBay carries a Zacks Rank 3 Hold You can see
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 |
WFC | Take Five World markets themes for the week ahead | LONDON Reuters Following are five big themes likely to dominate thinking of investors and traders in the coming week and the Reuters stories related to them
1 THE ART OF WAR
As U S tariffs on Chinese imports kick in President Donald Trump is threatening to tax goods worth 500 billion roughly the value of all U S imports from China in 2017
What could Beijing do to ease the impact on its economy In theory it could ease policy It has also subtly hinted at using yuan depreciation as a retaliatory tool by allowing the currency to post its biggest monthly loss on record in June
Though capital outflows are a risk Upcoming data will provide a crucial insight into China s economy the weekend brings the latest FX reserves picture consumer and factory inflation figures emerge on July 10 trade data due July 13 will show if trade angst had already hit exports and imports in June All that will set markets up for Q2 GDP due the following week Tensions with Washington may already have slowed economic growth Reuters polls predict
GRAPHIC Trade tensions in China s stock currency markets
2 SAY THE WORDS YOU LONG TO HEAR
The Fed is pressing ahead with raising interest rates global financial conditions are tightening and investors are nervous about the global economy Emerging markets are under the cosh and bond yield curves are flattening the U S yield curve is less than 30 basis points from inversion the signal that recession is coming
This is the backdrop to a series of speeches next week from some of the world s most powerful central bankers Bank of Japan governor Kuroda European Central Bank chief Draghi Bank of England boss Carney and Bank of Canada s Poloz all take the stand The BoC will likely also raise interest rates next week
Here s the balance they will try to strike signal an exit from crisis era stimulus but not so fast that growth and investor confidence will plummet It won t be easy As it stands the current economic expansion and bull market are very long in the tooth Fed tightening alone could be enough to end them both
GRAPHIC U S Yield Curve
3 EARN BABY EARN
Amid trade wars signs of slowing economic growth world markets remain relatively robust Bumper U S company earning are part of the reason Thanks to tax cut tailwinds Q1 earnings growth clocked in at 26 6 percent and the second quarter starting next week should moderate only slightly to 20 7 percent
However the season is being clouded by trade tensions and their impact on corporate profits So analysts will closely scrutinize outlook statements to see whether to adjust numbers for the rest of 2018 Right now 23 4 percent earnings growth is forecast for the third quarter and 20 2 percent for the fourth
U S quarterly earnings graphic
Financials stocks won big from the tax cuts their Q1 bottom lines were possibly fattened by as much as 5 billion many estimate So eyes will be on Wells Fargo NYSE WFC Citi and JP Morgan reports on July 13 Thomson Reuters I B E S forecast banks Q2 growth at 22 percent
But numbers are seen less toppy next year slimming to 7 3 percent in the first quarter and just over ten percent for the three subsequent
GRAPHIC S P500 earnings Q2
4 MAY WAY OR THE HIGHWAY
Britain s markets are in for another bumpy ride next week
They will be digesting the outcome of a crunch Brexit showdown at the government s country retreat on Friday Resignations rebellions and coup plots have all been rumored if Prime Minister Theresa May doesn t back a clean break from the EU At the same time British industrial giants are sounding shrill warnings of mass exodus if EU trade ties are lost
May will then get a visit from Germany s Angela Merkel on Tuesday assuming she hasn t been ousted by then Merkel s visit is part of a Western Balkans summit where ironically the main agenda is EU integration But she will make time for a Brexit powwow with May
And it s not just politics On Tuesday Britain publishes monthly growth estimates for the first time a move intended to give policymakers more timely information about the economy The numbers will be released alongside output data for the services industrial and construction sectors and trade figures
GRAPHIC The fall and rise of sterling since Brexit vote
5CRUDE THREATS
Coming days may being more volatility to oil markets too They have already been on a rollercoaster rising almost to 80 per barrel after output cuts by the Organization of Petroleum Exporting Countries OPEC and allies
OPEC has agreed to ease output curbs but prices are receiving fresh impetus from Washington s new sanctions against Tehran Those in turn have led Iran s Revolutionary Guards to threaten a blockade of the Strait of Hormuz the world s most important oil artery through which a fifth of the world s oil consumption passes Tensions are running high with the U S Navy standing ready to ensure free navigation through the channel
High oil prices are wiping out any benefits the U S economy might enjoy from Trump s tax cuts But while he has lashed out at the cartel and urged it to raise production he is also pressuring governments to stop Iranian purchases Such rhetoric may push oil prices higher still As will any outbreak of hostilities in Hormuz
GRAPHIC Global crude oil supply demand balance |
WFC | Two Firms Raise Facebook Stock Price Targets | Investing com Research firm BTIG raised it stock price target on Facebook NASDAQ FB more than 50 saying both its Instagram unit and core social media site are performing better than expected BTIG boosted its 12 month forecast to 275 a share the highest among Wall Street firmsBTIG says Instagram Stories now has more than 400 million daily active users twice that of rival Snapchat Instagram recently launched a new app called IGTV which allows users to watch full screen hour long videos BTIG also says Facebook does not appear to be losing as many young users as previously thought Wells Fargo NYSE WFC recently raised its price forecast to 250 Facebook shares are up 11 this year having recovered from a sharp selloff triggered by a data breach scandal in March |
EBAY | EBay beats revenue estimate bumps up forecasts | By Arunima Banerjee and Anya George Tharakan Reuters Online retailer eBay Inc NASDAQ EBAY reported better than expected quarterly revenue and raised its sales forecast for the year as efforts to revamp its online marketplace start to pay off EBay shares were up 8 percent after the bell on Wednesday after the company s board also authorized an additional 2 5 billion stock buyback program The company which spun off PayPal last July has tackled slowing growth by focusing on small business sellers while offering a bigger selection of products Gross merchandise volume or the total value of all goods sold on its sites was up 4 percent at 20 9 billion in the second quarter ended June 30 helped by strength in its U S business The number of active buyers rose 4 percent to 164 million The company s revenue also got a boost from robust sales at Stubhub which won a 6 5 year revenue sharing deal to resell tickets for the New York Yankees last month Stubhub s revenue jumped 40 percent to 225 million in the latest quarter EBay raised its full year revenue forecast to a range of 8 85 billion to 8 95 billion from 8 6 billion to 8 8 billion and adjusted profit from continuing operations in the range of 1 85 to 1 90 from 1 82 to 1 87 per share The improved forecast was a positive surprise this early in the year Wedbush Securities analyst Gil Luria said For the third quarter the company forecast revenue of 2 16 billion to 2 19 billion and adjusted profit from continuing operations of 42 to 44 cents per share Analysts on average expect profit of 44 cents per share and revenue of 2 14 billion according to Thomson Reuters I B E S The company s net income rose to 435 million or 38 cents per share in the latest quarter from 83 million or 7 cents per share a year earlier Excluding one time items eBay earned 43 cents per share beating analysts expectations by 1 cent Revenue rose 5 7 percent to 2 23 billion ahead of analysts average estimate of 2 17 billion
Up to Wednesday s close shares of the San Jose California based company had fallen 5 6 percent in the past 12 months |
EBAY | Shares in eBay surge 6 after sales increase for second straight quarter | Investing com Shares in eBay Inc NASDAQ EBAY surged more than 6 on Wednesday in after hours trading after the global e commerce leader saw its sales rise sharply over the previous quarter marking the Silicon Valley based company s second straight period of quarterly gains
During eBay s second quarter of Fiscal Year 2016 which ended in late June the company finished with sales of 2 23 billion for the three month period representing an increase of 5 7 on a year over year basis It came as eBay s gross merchandise volume GMV soared by 6 on a currency neutral basis driving net income and helping generate more than 760 million of free cash flow over the quarter
Consequently eBay reported net profit of 435 million or 0 38 per share up considerably from earnings of 83 million or 0 07 from the same period a year ago The company also reported adjusted earnings per share excluding certain items of 0 43 topping analysts expectations of 0 42
The second quarter was another good quarter where we delivered strong results and had acceleration in growth said Devin Wenig President and CEO of eBay Inc We are now one year into executing our strategy to provide the best choice the most relevance and the most powerful selling platform and there are signs of momentum in our business We continue to invest in our platforms to ensure eBay is a global commerce leader for years to come
In addition eBay announced on Wednesday that its Board of Directors authorized a 2 5 stock repurchase program in July The program is designed to offset the effects of eBay s equity compensation program the company said in a statement
Shares in eBay jumped 1 81 or 6 71 to 28 80 in after hours trading |
EBAY | EBay Reports Q2 Revenue Beat GMV Growth Of 3 | eBay Inc NASDAQ EBAY just released its second quarter 2017 financial results posting adjusted earnings of 0 34 per share and revenues of 2 33 billion Currently EBAY is a Zacks Rank 3 Hold and is down 1 69 to 36 55 per share in trading shortly after its earnings report was released
eBay
Missed earnings estimates The company posted earnings of 34 cents per share excluding 32 cents from non recurring items missing the Zacks Consensus Estimate of 0 36 Investors should note that Zacks adjusts for stock options expenses in its consensus estimates eBay reported non GAAP earnings of 45 cents per share which were in line with Street estimates
Beat revenue estimates The company saw revenue figures of 2 328 billion just edging out our consensus estimate 2 311 billion
Total revenues were up nearly 4 4 year over year Gross merchandise volume reached 20 457 billion up about 3 from the prior year quarter Net revenues from eBay s marketplace were up about 5 while net revenues from StubHub grew 1
eBay expects net revenue between 2 35 billion and 2 39 billion in the third quarter which would represent organic FX neutral growth of 6 8 The company also said it expects non GAAP earnings per diluted share from continuing operations in the range of 0 46 0 48 and GAAP earnings per diluted share from continuing operations in the range of 0 30 0 32
In Q2 eBay delivered strong top and bottom line financial results led by Marketplace acceleration said CEO Devin Wenig During the past two years we have made significant progress to modernize eBay and drive growth by improving the customer experience creating a product catalog that covers more than half of our inventory and sharpening the eBay brand We are on track and focused on creating an even stronger eBay for years to come
Here s a graph that looks at eBay s recent earnings performance 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 in the United States and country specific sites in the United Kingdom Canada Germany Austria France Italy Japan Korea and Australia
Check back later for our full analysis on eBay s earnings report
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3 Top Picks to Ride the Hottest Tech Trend
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Last year it was generating 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 those who make the right trades early |
WFC | Junk bond yield jumps to 18 month high with surge in issuance | The yield on the Bloomberg Barclays LON BARC US jumped to the highest since December 2016 with surging issuance and fund outflows Bloomberg reports While yesterday was the busiest day of the year for high yield issuance June looks to be the slowest sixth month in five years Wells Fargo NYSE WFC cut 2018 issuance outlook to 175B from prior view 305B Lipper reports outflow of 1 13B for week ended June 27 BB and single B yields rose to 20 month highs and CCC yields closed at a three week high yesterday ETFs HYG JNK DHY HIX EAD PHT HYT HYLD JQC ACP ANGL CIK MCI DSU SJB KIO NHS CIF ARDC IVH GGM AIF MPV FHY PHF JSD VLT HYLS DHG PCF MHY UJB FALN CJNK HYIH HYLB HYXE WFHY HYDB BSJP HYUP USHYNow read |
WFC | Lawsuit targets hidden fees in Wells Fargo finance programs | By Dena Aubin NEW YORK Reuters Wells Fargo NYSE WFC Co has been hit with a lawsuit by a Texas jewelry company accusing it of encouraging thousands of retailers nationwide to charge hidden fees to customers using financing programs created by the bank Then lawsuit filed on Thursday in San Francisco federal court said retailers were told to build financing fees into the price of goods and advertise that purchases could be financed interest free In reality the higher purchase price amounted to a hidden double digit interest charge the lawsuit said It alleges violations of the U S Truth in Lending Act which requires lenders to clearly disclose financing charges The complaint was filed by El Paso Texas based J Edwards Jewelry Distributing and its president John Silverman as a proposed class action on behalf of over 5 000 retailers nationwide Wells Fargo spokeswoman Hilary O Byrne said the bank has received the lawsuit and is reviewing its claims but cannot comment further on pending litigation The finance programs went by such names as Wells Fargo Jewelry Advantage or Wells Fargo Home Projects The fourth biggest U S bank Wells Fargo has also been grappling with a sales scandal involving unauthorized accounts In April it agreed to pay 1 billion to settle regulators allegations that it forced unneeded auto insurance on consumers and charged homebuyers excessive fees Thursday s lawsuit said the financing programs were advertised at retailers stores and on their websites but Wells Fargo controlled how merchants could describe them Retailers were told they could not charge a fee for customers using Wells Fargo financing but could inflate a purchase price to cover the fees the lawsuit said In a typical purchase a customer might pay 3 000 for a ring and zero interest if the full amount was paid within 60 months the complaint said The retailer forfeited 22 5 percent of the cost to Wells Fargo in exchange for the zero percent financing the lawsuit said Customers could buy the same ring for just 2 325 if they paid in cash saving 675 the lawsuit said Customers using Wells Fargo financing were thus paying 675 in undisclosed finance charges it said Wells Fargo likely collects as much as 800 million a year in hidden finance charges through the programs the lawsuit said Because finance charges were built into a purchase price the lawsuit said retailers also had to remit more sales taxes to local governments than they otherwise would have The case is Silverman et al v Wells Fargo Co U S District Court California Northern District No 18 3886 |
WFC | March Builders Confidence On A Solid Footing 5 Picks | Homebuilders confidence data for March was solid Does this imply that builders are shaking off worries associated with rising costs of materials owing to new tariffs on lumber aluminum and steel as well as apprehensions related to higher mortgage rates The latest reading surely points at renewed strength in the sector According to the latest report of the National Association of Home Builders NAHB and Wells Fargo NYSE WFC Housing Market Index reading is still very strong at 70 Homebuilder confidence in the United States saw a modest decrease down 1 point from last month as expected Builders optimism continues to be fueled by growing consumer demand for housing and confidence in the market said NAHB Chairman Randy Noel a custom homebuilder from LaPlace Louisiana However builders are reporting challenges in finding buildable lots which could limit their ability to meet this demand Housing Market Index primarily reflects builders perceptions of current single family home sales and sales expectations for the next six months Notably buyer traffic fell three points to 51 Sales prediction for the next six months dropped two points to 78 However the component gauging current sales conditions remained unchanged from the previous month at 77 Consumer Demand Remains ElevatedThe latest report from the Mortgage Bankers Association or MBA shows that mortgage applications for new home purchases were 4 6 higher in February compared with a year ago and up 3 from January 2018 and inventory of previously owned homes was at multi decade lows U S homebuilding performed well in 2017 giving investors ample scope to rake in handsome gains This year the industry looks equally attractive courtesy of solid economic growth and job market Consistent job growth growing interest from first time homebuyers as well as high homebuilder confidence are adding to the momentum Yet builders are concerned about growing labor shortage and limited land availability that are shrinking margins thereby prompting them to push prices higher Apart from concerns related to a series of interest rate hikes by the Federal Reserve homebuilders are now worried about higher material costs thanks to newly imposed tariffs on aluminum and steel These are restricting homebuilders from responding to growing demand Construction costs escalated in February driven by price increases for a wide range of building materials including steel and aluminum per the latest March report released by the Associated General Contractors of America of Labor Department Association officials have also warned that newly imposed tariffs on these metals will create steeper increases that will squeeze budgets for infrastructure school districts and commercial projects That said consumer confidence shot up to 130 8 in February the best since November 2000 when it logged a reading of 132 60 its highest level so far Robust economic conditions and impressive employment rate boosted consumer confidence For the fifth month in a row the jobless rate remained unchanged at 4 1 in February a 17 year low Improving economic growth supported by a better employment picture generally boosts housing activity and provides the basis for stronger demand With these economic fundamentals in place the overall homebuilding picture is pretty encouraging for 2018 Stocks to Bet OnAdding some housing stocks to your portfolio looks like a smart move at this point as there are plenty of reasons to be optimistic about the broader housing sector over both the short and the long term However picking winning stocks may be difficult With the help of the we have zeroed in on five stocks that have a Zacks Rank 1 Strong Buy or 2 Buy and favorable metrics A top Zacks Rank indicates that these stocks have been witnessing positive estimate revisions which generally translates into rapid price appreciation Boise Cascade Company NYSE BCC a wood products manufacturer and building materials distributor has an expected earnings growth rate of 36 7 for the current year The Zacks Consensus Estimate for 2018 earnings has risen 17 6 over the last 30 days for this Zacks Rank 1 stock You can see Louisiana Pacific Corporation NYSE LPX is a manufacturer of building products primarily for new home construction and outdoor structures The company sports a Zacks Rank 1 and has been witnessing upward estimate revisions for 2018 up 36 6 in the last 60 days The Zacks Consensus Estimate projects EPS growth of 13 3 for 2018 Potlatch Corporation NASDAQ PCH also a Zacks Rank 1 stock is an integrated forest products company with substantial timber resources Earnings are expected to rise 26 3 in 2018 The stock has witnessed 9 6 upward revision in earnings estimates for 2018 over the last 60 days Meritage Homes Corporation NYSE MTH is one of the leading homebuilders in the United States The Zacks Consensus Estimate for earnings for the current year has increased 8 6 in the last 60 days thus reflecting optimism about the stock s prospects and substantiating its Zacks Rank 2 The company s EPS is expected to grow 30 4 in the current year Lyon William Homes NYSE WLH is primarily engaged in design construction marketing and sale of single family detached and attached homes in California Arizona Nevada and Colorado The company carries a Zacks Rank 2 and earnings estimates for the current year have also gone up by 10 5 in the last 30 days It has an expected earnings growth rate of 38 for 2018 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 | EBay tops analyst s sales forecasts in spite of currency headwinds | Investing com Shares in eBay Inc inched up in after hours trading after the multinational e commerce company topped analysts revenue forecasts last quarter while posting its first quarter of sales gains in more than a year
During EBay s NASDAQ EBAY first quarter of Fiscal Year 2016 the San Jose based company reported earnings of 482 million or 0 41 per share down from 626 million or 0 51 from the same period a year earlier On an adjusted earnings per share basis which stripped out stock based compensation expenses EBay suffered a slight decline from 0 48 to 0 47 for the quarter
At the same time EBay increased its revenue on the period by 3 7 to 2 14 billion amid gross merchandise volume of 20 5 billion for the first three months of the year On a currency neutral basis EBay sales jumped by approximately 6 in the first quarter Analysts expected to see earnings per share of 0 45 on revenues of 2 08 billion
The first quarter represents another quarter of solid results as we continue to position eBay for long term success said Devin Wenig President and CEO of eBay Inc We are executing our plan and making progress on our strategic priorities to ensure our buyers have the best choice of products and a simple personalized shopping experience while sellers benefit from our powerful selling platform
Also on Tuesday EBay disclosed that the company repurchased approximately 1 0 billion of its common stock or 42 3 million shares during the first quarter As of March 31 EBay s total repurchase authorization stood at 0 8 billion the company said in a statement
Moving forward EBay expects next revenue between 2 14 and 2 19 billion during the second quarter with currency neutral growth between 4 and 6 In addition EBay expects to report GAAP earnings per diluted share from continuing operation between 0 32 and 0 34
Shares in EBay gained 0 23 or 0 94 to 24 72 in after hours |
EBAY | Gawker privacy lawsuit evolves into battle of tech billionaires | By Sarah McBride SAN FRANCISCO Reuters Billionaire media owner Pierre Omidyar is backing news and entertainment web site Gawker Media in its lawsuit against wrestler Hulk Hogan adding a new twist to a case pitting technology money against press freedom Omidyar owner of The Intercept publisher First Look Media is asking other media outlets to file legal briefs in support of Gawker First Look said in a statement on Friday First Look said its goal was to protect constitutional rights The possibility that Gawker may have to post a bond for 50 million or more just to be able to pursue its right to appeal the jury s verdict raises serious concerns about press freedom said Lynn Oberlander general counsel at First Look in a statement Gawker is battling an invasion of privacy lawsuit brought by Hogan who won a 140 million judgment against it enough to cripple the company which this week said it was exploring financial options In 2012 Gawker had published a sex tape of Hogan whose real name is Terry Bollea The saga has become a lightning rod for debate about the role of money in the legal system and civic affairs Omidyar who made a fortune co founding online auction site eBay O EBAY would support Gawker in its legal fight financially as well as via the court briefs a person familiar with the situation said But Omidyar has no interest in buying a stake in Gawker itself the person said Gawker said in a statement it welcomed the support from First Look but did not provide details Media outlets including Dow Jones the New York Times Co and Turner Broadcasting did not immediately respond to requests for comment on whether First Look had approached them A previous motion to intervene in the case was supported by several news outlets First Look said including Turner s Cable News Network and the Associated Press Earlier this week Peter Thiel an early backer of Facebook O FB and a co founder of PayPal O PYPL acknowledged that he had played a lead role in financing Bollea s litigation Gawker posted a 2007 article about Thiel entitled Peter Thiel is totally gay people Omidyar a long time liberal said on Twitter his actions were not personal Thiel is backing presumptive Republican nominee Donald Trump for U S president Also I ve never met Peter respect his work as VC and obv disagree on Trump and press there is no bad blood he wrote in response to a Twitter comment A spokesman for Thiel declined to comment on Omidyar s backing of Gawker Many in Silicon Valley rushed to Thiel s defense once news broke of his support of Hogan Click bait journalists need to be taught lessons Far less ethics and more click chasing in press today I m for theil tweeted another prominent venture capitalist Vinod Khosla on Thursday Khosla is fighting his own legal battle over whether the public may access the beach on property he owns in San Mateo County California Thiel has donated to the Committee to Protect Journalists which advocates for journalists who encounter beatings threats and other intimidation
The New York Post first reported the news of Omidyar s latest push to support Gawker |
WFC | Mulvaney led U S CFPB slashes payday lender penalty sources | By Patrick Rucker WASHINGTON Reuters Mick Mulvaney head of the U S Consumer Financial Protection Bureau cut in half a fine that his Obama era predecessor sought against a payday lender and dropped some of the agency s earlier claims in the case three people familiar the matter told Reuters Mulvaney appointed by President Donald Trump has vowed to dial back what he says is overreach by the independent agency which was created following the 2007 2009 financial crisis to stamp out predatory lending The CFPB fined South Carolina based lender Security Finance 5 million on June 13 for harassing borrowers when collecting debt and mishandling credit report data Richard Cordray Mulvaney s predecessor had wanted to seek additional charges against the company for pushing borrowers to buy personal insurance that was bundled into loans Cordray wanted Security Finance to pay 11 million with 3 million as a penalty for the debt collection and credit reporting abuses and at least 8 million to compensate consumers who felt pushed into insurance the sources said Mulvaney dropped the insurance claims meaning the settlement with Security Finance leaves no money for customers Cordray wanted to remediate Reuters reported in March that Mulvaney was reviewing the case We are agreeing to this settlement to close the matter and move forward in serving our customers said Security Finance chief Susan Bridges in a statement The company declined to comment on its insurance business John Czwartacki spokesman for the CFPB said the agency s claims in the consent order were based on what was supported by evidence The enforcement arms of government should not be used in order to shake down the productive sector just because we can especially when the legal case is shaky at best he said The CFPB has prevailed in many cases involving add on products in the past and the industry will be watching to see if Mulvaney is pulling back from such cases said Christopher Peterson a former CFPB attorney The CFPB s job is to deter illegal activity not look the other way said Peterson who now teaches at the University of Utah If the agency eases up industry will notice Mulvaney has also dropped several cases begun by Cordray Reuters has reported The Security Finance penalty was only the second in Mulvaney s seven months leading the bureau following a record 1 billion fine against Wells Fargo Co N WFC for auto insurance and mortgage lending abuses Security Finance routinely charges triple digit interest on short term loans and sent collection agents to 1 3 million customers at home and at work threatening and in some cases physically assaulting borrowers according to the CFPB settlement
Security Finance also delivered millions of faulty reports to credit bureaus CFPB determined In its settlement Security Finance promised it would keep accurate records for the credit bureaus |
WFC | Conference Board Leading Economic Index Another Record High In January | The latest LEI for January increased to 108 1 from 107 0 in December The Coincident Economic Index CEI came in at 103 0 up from the previous month
The Conference Board LEI for the U S increased for the fourth consecutive month in January Large positive contributions from building permits and the financial subcomponents were the main drivers of the strong gain In the six month period ending January 2018 the leading economic index increased 3 8 percent about a 7 8 percent annual rate faster than the growth of 2 3 percent about a 4 6 percent annual rate during the previous six months In addition the strengths among the leading indicators remain very widespread in PDF
Here is a log scale chart of the LEI series with documented recessions as identified by the The use of a log scale gives us a better sense of the relative sizes of peaks and troughs than a more conventional linear scale
For additional perspective on this indicator see the latest which includes this overview
The U S LEI accelerated further in January and continues to point to robust economic growth in the first half of 2018 While the recent stock market volatility will not be reflected in the U S LEI until next month consumers and business outlook on the economy had been improving for several months and should not be greatly impacted said Ataman Ozyildirim Director of Business Cycles and Growth Research at The Conference Board The leading indicators reflect an economy with widespread strengths coming from financial conditions manufacturing residential construction and labor markets
For a better understanding of the relationship between the LEI and recessions the next chart shows the percentage off the previous peak for the index and the number of months between the previous peak and official recessions
LEI and Its Six Month Smoothed Rate of Change
Based on suggestions from Neile Wolfe of LLC and Dwaine Van Vuuren of we can tighten the recession lead times for this indicator by plotting a smoothed six month rate of change to further enhance our use of the Conference Board s LEI as a gauge of recession risk
As we can see the LEI has historically dropped below its six month moving average anywhere between 2 to 15 months before a recession The latest reading of this smoothed rate of change suggests no near term recession risk Here is a twelve month smoothed out version which further eliminates the whipsaws
The Conference Board also includes its Coincident Economic Index CEI in each release It measures current economic activity and is made up of four components nonagricultural payroll personal income less transfer payments manufacturing and trade sales and industrial production Based on observations when the LEI begins to decline the CEI is still rising Here s a chart including both the CEI and LEI
Here is a chart of the LEI CEI ratio which is also a leading indicator of recessions |
EBAY | EBay s Price Target Raised By Credit Suisse Rating Upgraded | eBay Inc s NASDAQ EBAY price target was recently raised by more than 29 to 44 from 34 by investment firm Credit Suisse SIX CSGN Additionally analysts upgraded the stock s rating to Outperform from Neutral Following the upgrade eBay s shares were up 0 65 to 35 55 Also in the last one year the stock has outperformed the Zacks Internet Commerce industry The stock gained 48 2 compared with the industry s growth of 46 2 Why the Upgrade Credit Suisse s analyst Paul Bieber remains encouraged by the company s growth in its marketplace business He believes that the platform changes product innovation and investment in marketing will help in driving growth in the marketplace business through the second half of 2017 In order to further expand its growth Marketplace rolled out a number of new consumer experiences built on eBay s structured data efforts In the recently reported first quarter the company also rolled out a new personalized homepage in the Netherlands and announced new services like Guaranteed Delivery program on 20 million items that arrive in three days or less An authentication program to enhance consumer confidence related to high end merchandise purchase was also introduced Additionally Bieber is also positive about eBay s classified and StubHub businesses The analyst expects the combined value of these businesses to be worth 9 5 12 8 billion or 25 35 of current enterprise value Recently StubHub became the official ticket resale marketplace for Los Angeles Angels and Toronto Blue Jays Classifieds launched a personalized homepage feed on Marktplaats nl and continued integrating inventory with the Marketplace platform across multiple regions Moreover the analyst is positive about the company s share repurchase program Bieber expects the share repurchases to add 10 cents to the company s earnings in 2018 The company has repurchased roughly 350 million shares in the first quarter Bottom lineeBay is one of the world s largest online trading communities with a powerful marketplace for sale of goods and services by individuals and small businesses The company enables trade on a local national and international basis with local sites in numerous markets of the U S the U K Canada Germany Austria France Italy Japan Korea and Australia eBay continues to increase user engagement and satisfaction by driving traffic to its top rated sellers Although its growth rate has come down after PayPal s spinoff standalone eBay offers a convincing opportunity with a desirable marketplace format It has no inventory risk better margins and greater capital efficiency than most retailers Numerous initiatives including structured data application of artificial intelligence enhancing mobile experience increased use of social media to drive traffic focus on a discovery based user experience category merchandising and an easier listing process are tailwinds However intensifying competition in the e Commerce space as well as foreign exchange headwinds remain major concerns for the stock eBay Inc Price and Consensus
Zacks Rank Stocks to ConsiderCurrently eBay has a Zacks Rank 3 Hold Some stocks that have been performing well in the same space are Autobytel Inc NASDAQ ABTL Mercadolibre Inc NASDAQ MELI and PetMed Express Inc NASDAQ PETS each carrying a Zacks Rank 1 Strong Buy You can see Autobytel Inc delivered a positive earnings surprise of 41 98 on average in the trailing four quarters Mercadolibre Inc delivered a positive earnings surprise of 26 74 on average in the trailing four quarters PetMed Express Inc delivered a positive earnings surprise of 9 32 on average in the trailing four quarters Looking for Stocks with Skyrocketing Upside Zacks has just released a Special Report on the booming investment opportunities of legal marijuana Ignited by new referendums and legislation this industry is expected to blast from an already robust 6 7 billion to 20 2 billion in 2021 Early investors stand to make a killing but you have to be ready to act and know just where to look |
WFC | Wealth management startup SigFig secures 50 million round led by General Atlantic | By Anna Irrera NEW YORK Reuters SigFig a San Francisco based startup that provides wealth management technology to financial companies has raised 50 million from investors it said on Tuesday The fundraising round was led by investment firm General Atlantic with participation from existing investors including UBS Group AG Eaton Vance Corp and Bain Capital Ventures SigFig will use the funding to invest in developing new technology and expanding the type of services it offers clients including large banks such as UBS Wells Fargo NYSE WFC and Citizens Bank it said Founded in 2007 the company sells software to established large financial institutions to enable them to offer new digital service such as automated wealth management known as robo advice SigFig also provides robo advice directly to consumers It also provides technology to enable human financial advisors to enhance their services We have seen a remarkable uptick in banks wanting to partner with fintech companies Mike Sha CEO and co founder of SigFig said in an interview Sha said the company could also offer products to help bank branch employees provide advice to clients SigFig s investment round comes as traditional wealth managers and banks seek to improve their online and digital offerings in the face of changing customer demands and more competition from tech savvy startups In November Wells Fargo launched a robo advice service developed with technology from SigFig while Citizens Bank partnered with the startup in late 2016 to help manage portfolios of middle income people saving for retirement The market for digitally native investment advisors continues to grow due to increasing customer demand for accessible and affordable financial advice Paul Stamas managing director at General Atlantic who will join the company s board of directors said in a statement SigFig had last raised 40 million in a round led by Eaton Vance in 2016 The round announced on Tuesday was not much larger because SigFig was a very capital efficient business and does not need to spend lots of money on marketing Sha said He added that the company was not profitable yet by choice because it was reinvesting in growing the business
Other investors in the round included DCM Ventures New York Life Nyca Partners and Union Square NYSE SQ Ventures |
WFC | Gold s Slump May Be Far From Over | Investing com Gold prices have been hitting new lows for the year and some analysts say get used to it The precious metal staged several modest rallies above the 1 350 an ounce level during the first few months of the year Since mid April however gold has been on a steady decline falling below 1 300 Gold and silver for that matter are trapped in a bear super cycle according to the Wells Fargo NYSE WFC Investment Institute That cycle began in mid 2011 when gold peaked at more than 1 900 and is likely to last another five years the firms says Analysts say the fundamental force driving down prices is excess supply which can takes a decade to erase graphic Title Forces Undermining Gold Strong Dollar Higher Interest RatesMarket forces are also playing a role The strong dollar and rising interest rates have made gold s return less attractive say analysts and that s unlikely to change anytime soon Gold is now much closer to the high end of Wells Fargo s bear market range than the low end which means there s more room for pain than there is for gain |
WFC | Credit Suisse prevails in lawsuit seeking 300 million for brokers U S judge | By Jonathan Stempel Reuters A federal judge on Thursday dismissed a lawsuit accusing Credit Suisse SIX CSGN Group AG of withholding up to 300 million of compensation from U S based brokers when it closed their private banking unit in 2015 U S District Judge William Orrick in San Francisco ruled that the plaintiff Christopher Laver was bound by an agreement to arbitrate employment related disputes and could not pursue his proposed class action on behalf of roughly 200 brokers The judge also said any arbitration details should be worked out in New York where Credit Suisse thought the case belonged A lawyer for Laver did not immediately respond to requests for comment Credit Suisse said it was pleased with the decision Laver had sued on behalf of brokers who refused or claimed they were unable to move to Wells Fargo NYSE WFC Co which was given exclusive recruiting rights when Credit Suisse shut the 275 broker private banking unit He said Credit Suisse s decision to enter a recruiting agreement with Wells Fargo rather than formally sell the unit and trigger payouts enabled the Swiss bank to stiff brokers by claiming they had all voluntarily resigned Credit Suisse has said it was standard industry practice for brokerages such as Wells Fargo to pay the deferred compensation at issue to new hires Plaintiffs cannot be paid the same money twice Credit Suisse spokeswoman Karina Byrne said Laver who lived near San Francisco joined UBS AG after ending his 13 year stint at Credit Suisse He has worked in financial services since 1981 Wells Fargo was not a defendant and was not accused of wrongdoing
The case is Laver v Credit Suisse Securities USA LLC U S District Court Northern District of California No 18 00828 |
WFC | Wells Fargo fined by SEC over investment sales misconduct | By Jonathan Stempel and Imani Moise Reuters Wells Fargo Co N WFC will pay more than 5 1 million to settle U S Securities and Exchange Commission charges it improperly pushed retail customers to actively trade complex investments in order to generate higher fees The SEC on Monday said the payout includes a 4 million civil fine plus the return of ill gotten gains and interest over misconduct by the Wells Fargo Advisors brokerage in its sale of so called market linked investments Wells Fargo was accused of reducing investor returns by encouraging customers to actively trade the investments though they were intended to be held to maturity and despite an internal policy prohibiting short term trading and flipping The San Francisco based bank did not admit or deny wrongdoing but has taken steps to address sales practices that occurred from January 2009 to June 2013 the SEC said Wells Fargo said in a statement it has made policy and management changes related to the SEC charges and is committed to helping customers achieve their investment goals Wells Fargo has been plagued for nearly two years by scandals over how it treated its customers including by selling them products they did not need to meet internal sales goals It 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
Market linked investments are fixed maturity products whose interest rate is determined by the performance of a particular asset or market measure such as equity and commodity indexes |
WFC | Market Volatility And VIX based Exchange Traded Notes | Our covered call writing and put selling portfolios have been significantly impacted the past few weeks from extreme In addition to rising wages inflation concerns and projected interest rate hikes volatility based exchange traded notes are also playing a role in the market decline
What is the VIX
The VIX is also known as the CBOE Volatility Index It demonstrates the market s expectation of 30 day volatility based on option pricing It measures market risk and is frequently called the investor fear gauge
What are exchange traded notes ETNs
ETNs are unsecured debt securities based on the performance of a market benchmark like the VIX less applicable fees They are traded on major US exchanges during traditional trading hours ETNs have a maturity and are backed only by the credit of the issuer a key factor to consider When they mature the financial institution takes out fees and gives the investor cash based on the performance of the underlying index
Risks of ETNs
Investors must be directionally correct on index and cover expenses as well
The issuer may not be able to pay the cash on time
The issuer may default on the loan
Limited secondary market may result in large losses or gains
FINRA has warned against volatility linked ETNs and even required Wells Fargo NYSE WFC to pay investors 3 4 million for improper sales of these products
Current market and ETNs
In 2017 the VIX was historically low remaining under 15 while the S P 500 returned more than 20 Many hedge funds were playing the current market conditions by purchasing stocks and ETNs that targeted a declining market volatility This strategy works when the market continues to accelerate and volatility remains low But we all know what transpired the past few weeks Wage growth inflation concerns and projections of interest rate hikes rattled the market causing significant price declines and dramatic increases in volatility The screenshot below shows a tripling of the VIX in the past month
Volatility Spikes as Market Declines
Many inverse VIX ETNs lost more than 90 of their value as a result of the trade no longer working The chart below shows the VelocityShares Daily Inverse VIX Short Term ETN XIV dropping from 144 to 5 in a few days
XIV Drops more than 90 in a Few Days
These events with volatility based inverse ETNs have resulted in a secondary exacerbation of market volatility as institutional investors unwind these ETN positions and sell stock shares to reduce their leverage Investors are concerned about VIX related trading volume and revenues declining and impacting the CBOE itself because 25 of CBOE global market revenue is generated from VIX related products This concern is reflected in the chart below
CBOE Price Decline
Discussion
Volatility based ETNs are extremely risky and not appropriate for most retail investors However it is beneficial to understand how these products may be a secondary factor in impacting our option selling positions in extreme market conditions
Volatility and our covered call positions re published from last week s blog commentary
Many of our members who have never experienced the type of market volatility we have experienced recently have been inquiring about how to incorporate volatility into our investment decisions I have moved from more aggressive positions out of the money strikes to more defensive positions in the money strikes Both can generate cash into our brokerage accounts I will also be discussing volatility in this weekend s blog article
All other factors being the same I favor OTM strikes when the VIX is below 20 and either declining or consolidation moving sideways I favor ITM strikes when the VIX moves above 20 and confirms the inverse relationship between the VIX and the S P 500
It is so important to trade in a non emotional manner as aberrations like we recently have been experiencing will rear their ugly heads from time to time and we need to eliminate fear and greed from our trading influences
It is true that a market acceleration can make ITM strikes appear to be a bad decision but in an environment of high volatility defensive trading makes more sense especially for retail investors looking to generate cash flow in a low risk manner
The chart I created below highlights how I address volatility and my option selling positions as they relate to volatility
Volatility and our Covered Call Positions
THE WEEK AHEAD
Mon Feb 19th
None President s day
Tue Feb 20th
None
Wed Feb 21st
Markit manufacturing PMI Feb
Markit services PMI
Existing home sales
Thu Feb 22nd
Weekly jobless claims through 2 17
Leading economic indicators Jan
Fri Feb 23rd
None
For the week the S P 500 rose by 4 30 for a year to date return of 2 19
Summary
IBD Market in confirmed uptrend
2 6 Sell signal since market close of February 7 2018
BCI Due to the market volatility I will be selling only in the money calls until market volatility subsides I remain bullish on the economy and the market moving forward
WHAT THE BROAD MARKET INDICATORS S P 500 AND VIX ARE TELLING US
The 6 month charts point to a neutral outlook In the past six months the S P 500 was up 11 while the VIX 19 46 moved up by 64
Wishing you much success |
EBAY | South Korea gives initial approval for first online only banks | SEOUL Reuters South Korea s financial regulator has given preliminary approval to two consortia backed by Kakao Corp and an affiliate of China s Alibaba N BABA Group Holding Ltd to set up the country s first online only banks Kakao which runs South Korea s most popular mobile chat service is part of a consortium of 11 partners including units of Tencent Holdings Ltd and eBay Inc O EBAY that won approval late on Sunday from the Financial Services Commission Another consortium of 21 partners led by telecom company KT Corp with Alibaba s Alipay Holding Ltd also received approval to open an online bank Shares in KT were up 2 2 percent as of 0340 GMT 10 40 p m ET while Kakao gained as much as 11 percent before paring gains on Monday The Kakao backed consortium in which Korea Investment Securities KOINVS UL Kookmin Bank KOOKM UL and Loen Entertainment are also partners plans to invest an initial 300 billion won 259 72 million into the bank with 400 billion won more to be invested in 2018 the regulator said The consortium plans to start operations as early as next year after final approvals expected in early 2016 KT s consortium whose partners also include Woori Bank and Hyundai Securities plan to invest an initial 250 billion won in the bank the regulator said In a bid to spur growth in its banking sector South Korea is allowing non financial firms to open banks but it still bars large industrial conglomerates such as Samsung KS 005930 Group and Hyundai Motor Group from taking part |
EBAY | EBay And TrueCar Collaborate For New Car Buying Service | eBay Inc s NASDAQ EBAY eBay Motors sealed a partnership with online automotive information and communications platform TrueCar NASDAQ TRUE to provide a new car buying service The partnership will give eBay shoppers access to TrueCar s pricing information and Certified Dealers network According to eBay s Vice President of North America Merchandising Hard Goods Together with TrueCar eBay shoppers will gain deep insights on new car prices further enhancing their automotive shopping journey eBay to Boost ClassifiedseBay is currently replatforming itself by building product catalogs on structured data enhancing mobile platform rolling out new browse inspired shopping journeys rejuvenating customer to customer C2C business and strengthening its brand eBay Inc Revenue TTM With the new move eBay Motor is putting its newly improved homepage which enables shoppers to search for auto parts new or used vehicles daily deals and engage with the eBay Garage Community and blog to some serious work Shoppers can now access TrueCar s website directly from eBay Motors enhanced homepage We believe that with the move eBay is trying to boost its Classifieds platforms that includes Motors We note that over the last one year the stock has underperformed the Zacks Internet Commerce industry It gained 43 7 compared with the industry s gain of 42 6 We expect replatforming and brand enhancement initiatives to lead to an upside TrueCar to Gain Strength on the Dealer FrontThe new move can be seen as a step to boost TrueCar s transaction revenues that consist of fees paid by dealers participating in the TrueCar Certified Dealers network Dealers pay this fee either on a per vehicle basis for sales to TrueCar s platform users or as subscription fees TrueCar s inclusion in eBay s platform will help attract more dealers to the network and improve revenues Zacks RankCurrently eBay has a Zacks Rank 3 Hold Better ranked stocks in the broader technology sector include Monolithic Power Systems Inc NASDAQ MPWR and Marchex Inc NASDAQ MCHX each carrying a Zacks Rank 2 Buy You can see Long term expected earnings per share growth rates for Marchex and Monolithic Power are 15 and 17 respectively The Best Worst of ZacksToday you are invited to download the full up to the minute list of 220 Zacks Rank 1 Strong Buys free of charge From 1988 through 2015 this list has averaged a stellar gain of 25 per year Plus you may download 220 Zacks Rank 5 Strong Sells Even though this list holds many stocks that seem to be solid it has historically performed 6X worse than the market |
WFC | Cryptos Struggle to Gain Momentum After Bitcoin Hack | Investing com Cryptocurrencies continued to fall on Tuesday as virtual coins struggled to gain ground after a steep fall on Monday following news that South Korean exchange Coinrail was hacked
Bitcoin was trading at 6 740 00 falling 0 52 the Bitfinex exchange as of 9 18 AM ET 13 18 GMT
Other digital coins were lower on Tuesday with Ethereum the world s second largest cryptocurrency by market cap falling 1 39 to 522 72 on the Bitfinex exchange Ripple the third largest virtual currency decreased 0 65 to 0 57433 while Litecoin was at 104 79 down 1 05
South Korean cryptocurrency exchange Coinrail announced on Twitter over the weekend that it was hacked prompting a sell off in bitcoin The incident sparked new concerns over cyber security at virtual coin platforms
South Korea is one of the top cryptocurrency trading centers with many of the biggest exchanges The hack of Coinrail is also just the latest of numerous virtual currency exchange cyber attacks which has weighed on market sentiment
The coin market cap was also lower with total market capitalization at 294 billion at the time of writing compared to 297 billion on Friday
In regulation news the Financial Action Task Force is considering introducing binding rules over cryptocurrency exchanges The Paris based group of 37 nation groups will look at existing guidelines which include exchanges being registered and applying Know Your Customer rules The group will determine if the rules should be changed or added to
Meanwhile Wells Fargo NYSE WFC is the latest bank to go after virtual coins The bank announced Monday that it was banning the use of its credit cards to purchase digital coins Other banks that have also banned |
WFC | Wells Fargo workers push for more board access so far in vain | By Ross Kerber and Imani Moise Reuters A labor backed group is stepping up pressure on Wells Fargo Co N WFC to add an employee to a council that has the ear of the bank s board and management arguing workers deserve a voice as Wells Fargo works to get past a damaging scandal over sales practices This raises the sensitive issue of how much of a voice the fourth largest U S bank is prepared to give to its roughly 265 000 workers some of whom were excessively pressured by managers to sell products to customers and whose support the bank may need to repair relations with U S regulators Wells Fargo has not definitively answered the requests from the union backed Committee for Better Banks for a worker representative to be added to Wells Fargo s recently formed Stakeholder Advisory Council The committee which also includes consumer and community advocates first made the request privately to management last June and repeated it in a May 29 letter seen by Reuters The May letter sent to Wells Fargo Chief Executive Tim Sloan called for another meeting with management and the committee says it has so far gone unanswered At Wells Fargo s annual shareholder meeting in April Sloan said the idea of adding a worker to the council was a fair one but also highlighted other efforts to connect with employees The council s current members include consumer and community groups such as the Interfaith Center on Corporate Responsibility which earlier this year persuaded Wells Fargo to undertake a review of its governance and risk management lapses Wells Fargo spokesman Ancel Martinez said the stakeholder council reviews employee feedback and noted other worker outreach initiatives such as internal message boards He declined to comment on whether the bank was working on adding an employee to the council Cornelius Hurley a Boston University law professor said it makes sense for a stakeholder council to have a workers representative but bank leaders might be shy of union ties at the CBB The group is backed by community consumer and labor groups including the Communications Workers of America and has called for changes at other banks including the U S operations of Spain s Banco Santander MC SAN Bankers go apoplectic when you talk about organized labor he said Erin Mahoney an organizer for the CBB and the Communications Workers of America labor union said the lack of a worker on the council stands out considering the other reforms put in place by bank leaders over the past year under pressure from regulators I d have to agree that so far it has been a missed opportunity she said The bank named its stakeholder council in late 2017 to advise on a range of topics as it works to improve oversight and governance to show that it has rooted out any customer abuses Its scandals erupted in 2016 after employee whistleblowers helped reveal customer abuses involving workers opening potentially millions of unauthorized accounts to hit sales targets That led to hefty fines and a cap on assets until the bank proves to U S regulators its governance has improved The stakeholder council meets with Wells Fargo s management and board which is chaired by Elizabeth Duke a former Federal Reserve governor who once headed the U S central bank s consumer and community affairs committee NEXT STEPS The bank has already taken other steps aimed at rebuilding the trust of employees and in turn investors including eliminating product sales goals for retail workers granting stock and raising wages Sloan said last fall the bank had hired back nearly 2 000 workers who quit or were fired At the same time Wells Fargo is under investor pressure to improve expenses per dollar of revenue One of the CBB s requests is for all Wells Fargo employees to be paid at least 20 an hour up from a base wage of 15 an hour No Wells Fargo employees are labor union members Just 46 000 or 1 1 percent of U S finance workers were union members Labor Department statistics for 2017 show the lowest percentage of any U S industry workforce Alex Ross a Wells Fargo bankruptcy specialist in the Minneapolis area and a CBB member said several dozen colleagues got in touch after he raised the group s issues with Sloan at the April meeting I think for organized labor to survive it needs to start looking to organize people in un organized sectors Ross said A seat at the council would let workers speak without fear of manager retaliation he said However bank leaders could be wary of giving workers more influence as a digital banking push changes its workforce needs said Ben Bystrom instructor at the Shidler College of Business in Hawaii Some members of the stakeholder council said they would be open to the idea of adding a worker
Mr Sloan seemed amenable I hope it will happen soon said member Nora Nash who is also director of Corporate Social Responsibility for the Sisters of St Francis of Philadelphia |
WFC | Wells Fargo receives final approval to settle 142 million lawsuit | Reuters Wells Fargo NYSE WFC Co said on Friday it received final approval from a district court in California to settle a 142 million class action lawsuit which compensates customers affected by a sales scandal related to phony bank accounts The settlement in which Wells had received a preliminary approval in July last year sets aside funds for compensating customers after the bank opened consumer or small business accounts credit cards or lines of credit without their knowledge between 2002 and April 2017 The United States fourth biggest bank is dealing with the fallout of two years of investigations agreeing in April to pay 1 billion to settle with regulators who say it forced auto insurance on hundreds of thousands and routinely hit homebuyers with excessive fees Last month the bank also agreed to pay 480 million to resolve a securities fraud lawsuit filed with the District Court for the Northern District of California which alleged the bank made certain misstatements and omissions in disclosures related to its sales practices Chief Executive Officer Tim Sloan said Friday s announcement was a significant step forward in making things right for our customers and restoring trust all of Wells Fargo s stakeholders Customers have until July 7 to claim money Announcing the settlement with regulators in August the bank also said that the mortgage and auto programs together ensnared more than 600 000 customers and would require nearly 300 million in refunds Analysts worry the scandal has hurt Wells Fargo both by distracting executives with investigations and lawsuits and through its impact on the bank s public image In February the U S Federal Reserve imposed a consent order on Wells that restricted it to grow assets beyond the 1 95 trillion it had at the end of last year until it sufficiently improves its governance and controls Sloan since then has reassured shareholders numerous times that the bank was stable and open for business Employees have also sought to downplay the scandal s impact on profitability or market share and have said that few customers have left the bank
Wells Fargo s shares were up 0 3 percent at 54 92 on Friday |
WFC | Wells Fargo mulls combining wealth management divisions | Reuters Wells Fargo Co N WFC said Monday it is considering restructuring and possibly combining two of its retail brokerage businesses a move to increase efficiency among the two legacy units The two divisions the private client group overseen by David Kowach and wealth brokerage services overseen by Jay Welker have long overlapped Both employ financial advisers who work with mass affluent clients However the businesses are organized in different channels Wealth brokerage services which employs brokers who work in bank branches is in the same section of the bank as the private bank which employs wealth managers who advise the ultra rich During the bank s investor day conference in March Jon Weiss head of wealth and investment management said Wells Fargo is exploring ways to increase efficiency among the bank s wealth businesses Wells Fargo Advisors spokeswoman Shea Leordeanu wrote in an emailed statement No final decisions have been made because that work continues Whatever the outcome we will continue to serve our clients across multiple channels community bank branches advisor led branches FiNet online and by phone because our clients expect that from us Wells Fargo Weiss is expected to address the plans on Thursday during a town hall style meeting with brokers The bank s plans to restructure were reported earlier on Monday by the Wall Street Journal
The bank had said in March it was examining its wealth and investment management division for possible customer abuse including overcharging and inappropriate referrals after inquiries from government agencies |
WFC | Chart Of The Day Is Wells Fargo Actually A Buying Opportunity | Investors buy shares seeking growth The last thing shareholders want to hear is that the company they ve invested in has been involved in something illegal That definitely doesn t fuel investment growth
Still that s exactly what investors heard when the Fed announced on Friday that due to widespread consumer abuses which were disclosed in 2016 and for which the bank has already paid an 185 Million settlement Wells Fargo NYSE WFC will be restricted from growing beyond its total assets as of the end of 2017 until the bank has made sufficient improvements
Investors rapidly cut off ties to the bank when markets opened yesterday as if it had the plague Traders joined in the fun since the selling promised to become a big move At least five Wall Street firms turned the knife by downgrading WFC shares
The price of the stock plunged 9 2 percent Nevertheless taking a contrarian stance Bank of America reiterated its recommendation advising to buy the weakness Our technical analysis agrees
Traders have been trading the stock within a rising channel since October 2016 The fall is halfway of the range which is natural for supply demand dynamics Moreover the plunge stopped both above the uptrend line since September 2017 and above a support resistance line since December 2016 It is this line that made the neckline for a H S bottom spurring the December January 18 percent rise
That line is the meeting of the hopes and dreams of traders right and wrong encouraged to repeat a right or discouraged to repeat a wrong This line is where traders have learned their lesson and joined the other team rightly or wrongly as conditions may have changed which also provides support Note how the three major weekly moving averages 50 100 and 200 are between the price current level and the uptrend line or the channel bottom They too are expected to provide support
In the daily chart we can more easily see the channel and the uptrend line since September 2017 and the support resistance line since December 2016 While the price fell below the 50 dma green it found support by the 100 dma blue which aligned with both the uptrend line since September of last year and the support resistance line since December 2016 It is also interesting to note that both trendlines meet at this point
At 29 the RSI suggests that the asset is oversold having reached its lowest since September when the uptrend line started
Trading Strategies Long Position
Conservative traders would wait for a save entry if the price reached the channel bottom at 52 at the current angle Then they would wait for evidence of demand as a long green candle would cover the preceding red candle
Moderate traders may enter a long position at this level after a green candle covers yesterday s real body open to close price disregarding shadows or intraday moves
Aggressive traders may enter a long now
Equity Management
A trade should be entered only after establishing the equity management plan Risk reward ratio should be at a minimum of 1 3 Therefore entry target and stop loss must be selected accordingly
Stop Losses 1 Below 57 55 low of yesterday or 2 55 54 200 dma red
Targets 66
Example An entry now at 58 16 with even the conservative stop loss at 57 00 provides a 1 16 or 2 percent risk with a 7 84 or almost 1 7 risk reward ratio better than double the classic 1 3 Obviously waiting for a potential return to the uptrend line since September 2017 would provide that much better a risk reward ratio and therefore statistical winning probabilities Alternatively the price might not return to the uptrend line and get away as the trader loses the opportunity Every safety measure as well as every risk has a cost That is how the balance is kept |
WFC | Is Wells Fargo Endeavor Select A STAEX A Strong Mutual Fund Pick Right Now | Having trouble finding a Large Cap Growth fund Wells Fargo NYSE WFC Endeavor Select A is a potential starting point STAEX holds a Zacks Mutual Fund Rank of 1 Strong Buy which is based on nine forecasting factors like size cost and past performance ObjectiveWe classify STAEX in the Large Cap Growth category an area rife with potential choices Large Cap Growth funds invest in many large U S companies that are expected to grow much faster compared to other large cap stocks To be considered large cap companies must have a market cap over 10 billion History of Fund ManagerSTAEX finds itself in the Wells Fargo family based out of San Francisco CA Wells Fargo Endeavor Select A debuted in December of 2000 Since then STAEX has accumulated assets of about 13 20 million according to the most recently available information The fund s current manager Michael T Smith has been in charge of the fund since February of 2010 PerformanceObviously what investors are looking for in these funds is strong performance relative to their peers This fund has delivered a 5 year annualized total return of 13 72 and is in the bottom third among its category peers Investors who prefer analyzing shorter time frames should look at its 3 year annualized total return of 11 84 which places it in the middle 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 STAEX s standard deviation over the past three years is 11 18 compared to the category average of 9 31 The fund s standard deviation over the past 5 years is 10 91 compared to the category average of 10 92 This makes the fund less volatile than its peers over the past half decade Risk FactorsInvestors should always remember the downsides to a potential investment and this segment carries some risks one should be aware of STAEX lost 50 91 in the most recent bear market and underperformed comparable funds by 2 02 This could mean that the fund is a worse choice than comparable funds during a bear market Even still the fund has a 5 year beta of 0 96 so investors should note that it is hypothetically less volatile than the market at large Because alpha represents a portfolio s performance on a risk adjusted basis relative to a benchmark which is the S P 500 in this case one should pay attention to this metric as well Over the past 5 years the fund has a negative alpha of 1 11 This means that managers in this portfolio find it difficult to pick securities that generate better than benchmark returns HoldingsExploring the equity holdings of a mutual fund is also a valuable exercise This can show us how the manager is applying their stated methodology as well as if there are any inherent biases in their approach For this particular fund the focus is mostly on equities that are traded in the United States This fund is currently holding about 88 32 stock in stocks with an average market capitalization of 221 66 billion The fund has the heaviest exposure to the following market sectors TechnologyFinanceTurnover is about 53 34 so those in charge of the fund make fewer trades than the average comparable fund ExpensesAs competition heats up in the mutual fund market costs become increasingly important Compared to its otherwise identical counterpart a low cost product will be an outperformer all other things being equal Thus taking a closer look at cost related metrics is vital for investors In terms of fees STAEX is a load fund It has an expense ratio of 1 22 compared to the category average of 1 12 From a cost perspective STAEX 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 Endeavor Select A has a high Zacks Mutual Fund rank and in conjunction with its comparatively weak performance average downside risk and higher fees Wells Fargo Endeavor Select A looks like a good potential choice for investors right now For additional information on this product or to compare it to other mutual funds in the Large Cap Growth make sure to go to 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 |
WFC | Low Beta ETFs To Buy As Bulls Play Hide Seek | The stock market bulls are playing hide and seek as the Dow Jones Industrial Average has been trading in wild swings this week The blue chip index fluctuated in a range of 1 600 and 1 200 on Monday and Tuesday respectively marking the two biggest intraday ranges in history The index also swung in a range of more than 500 points on Wednesday indicating heightened volatility read Renewed concerns over faster than expected rates hike have shaken complacency off the stock market The panic was created late last week after the January jobs data which showed that wages increased at the fastest pace in more than eight years The strong number has sparked fears of inflation that might force the Fed to adopt speedy rate hikes The Fed intends to increase interest rates three times this year but the rise in inflation could lead to four hikes Higher than expected rise in interest rates would lead to a rise in borrowing cost thereby dulling the appeal for equities As a result bond yields have risen sharply with 10 year yields climbing to 2 845 from 2 77 at the start of the month Further political turmoil and threats of overvaluation are also weighing on the bull market which is drawing closer to its ninth anniversary However the stock market is currently in a much better condition thanks to encouraging domestic and international fundamentals better than expected corporate earnings and the new tax legislation The massive 1 5 trillion tax cuts will create an economic surge boosting job growth and earnings of corporates About halfway through the earnings season the picture appears to be solid with all around strength and momentum Not only is an above average proportion of companies beating top and bottom line expectations but estimates for the current period are also materially going up the per read Investors seeking to remain invested in the equity world could consider low beta ETFs stocks as long as the chaos prevails Why Low Beta Beta measures the price volatility of stocks or funds relative to the overall market It has direct relationship to market movements A beta of 1 indicates that the price of the stock or fund tends to move with the broader market A beta of more than 1 indicates that the price tends to move higher than the broader market and is extremely volatile while a beta of less than 1 indicates that the price of the stock or fund is less volatile than the market That said low beta products exhibit greater levels of stability than their market sensitive counterparts and will usually lose less when the market is crumbling Despite lesser risks and lower returns these are considered safe and resilient amid uncertainty However when markets soar these low beta funds experience lesser gains than the broader market counterparts and thus lag their peers Below we have highlighted five ETFs using our that could be intriguing options for investors until the market track clears These funds do not track a particular sector or industry but are instead exposed to broader market risk and reward PowerShares Financial Preferred Portfolio TO PGF Beta 0 07This fund tracks the Wells Fargo NYSE WFC Hybrid and Preferred Securities Financial Index which measures the performance of preferred securities traded in the U S market by financial institutions It holds 86 securities in its basket and charges 63 bps in annual fees The ETF has amassed 1 6 billion and trades in average volume of 308 000 shares per day It charges 63 bps in annual fees and has lost 0 5 in a one week timeframe see Legg Mason Low Volatility High Dividend ETF Beta 0 52This fund provides exposure to U S companies with a relatively high yield low price and earnings volatility by tracking the QS Low Volatility High Dividend Index Holding 86 stocks in its basket LVHD has 498 8 million in AUM and trades in moderate volume of 61 000 shares It charges 27 bps in fees and lost 4 6 over the past week Global X SuperDividend U S ETF TO DIV Beta 0 57This fund provides exposure to 51 of the highest dividend yielding equity securities in the United States by tracking the INDXX SuperDividend U S Low Volatility Index It has amassed 400 7 million in its asset base while trades in moderate volume of about 78 000 shares The ETF charges 45 bps in fees per year from investors and is down 3 5 in the same time frame Horizons NASDAQ 100 Covered Call ETF Beta 0 59This ETF follows the CBOE NASDAQ 100 BuyWrite V2 Index which is designed to buy a NASDAQ 100 stock index portfolio and writing or selling the near term NASDAQ 100 Index covered call option generally on the third Friday of each month The product has 171 6 million in AUM and trades in a lower volume of under 47 000 shares a day on average Expense ratio came in at 0 60 QYLD has lost 2 7 read Pacer Trendpilot US Large Cap ETF Beta 0 60This ETF follows the Pacer Trendpilot US Large Cap Index which uses an objective rules based methodology to implement a systematic trend following strategy that directs exposure 100 to the S P 500 index or 50 to the S P 500 and 50 to 3 Month US Treasury bills or 100 to 3 Month US Treasury bills depending on the relative performance of the S P 500 index its 200 business day historical simple moving average The fund has AUM of 808 5 million and charges 60 bps in annual fees Average daily volume is good as it exchanges 130 000 shares in hand PTLC has lost 5 1 over the past week Bottom LineInvestors should note that these products are not meant for generating outsized returns Instead these provide stability in the portfolio protecting the initial investment In particular these products could be worthwhile for low risk tolerant investors looking to safeguard their portfolio in a rocky market and some outperformance especially if market uncertainty prevails in the coming months 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 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WFC | Taking A Look At The Main Market Indicators | There is no change to the risk budget this month For the moderate risk investor the allocation to bonds is 50 risk assets 45 and cash 5 Despite the selloff of the last week I don t believe any portfolio action is warranted While the overbought condition has largely been corrected now the S P 500 is far from the opposite condition oversold At the lows this morning the S P 500 was officially in correction territory down 10 from the recent highs That in and of itself is not sufficient in our process to dictate a change in allocation
When I last wrote an asset allocation update on January 4 the S P 500 closed at 2723 99 As I write this late on February 6th the S P 500 is trading at 2695 14 a drop of 1 1 Now if that was the only information you had how would you feel about the stock market Worried Panicked Kind of hard to get worked up about isn t it Of course we do have other information and know that the market actually traded in a 280 point range during that time First a quick 5 5 rally to the top and then an even quicker nearly 10 drop mostly compressed into two and half trading days Does that matter Can you just ignore what happened in between and concentrate on the end result
Mostly I think that is pretty good advice We know from research that the more often people look at their accounts the worse their returns You can always find something to do with your portfolio fear and greed are eternal and checking your account makes it that much more likely that you will And the more changes you make the more likely it is you ll make a mistake Investment advisers have to guard against this more than the average person because it is our job to look at the markets and most of us do it every day And most of us are still human and susceptible to the same foibles as other investors
And besides despite the big numbers the selloff of the last three days is pretty unremarkable in market history There are over 100 previous trading days with worse percentage losses than Monday and most of them are forgotten Remember August 2011 No The 8th and the 10th of that month were both worse than Monday That selloff took the S P all the way down to 1101 54 and the market has only managed a 145 gain since then In the big picture those two bad days meant absolutely nothing Will the last three days be similarly forgotten Probably
However I do think that the events of the last few weeks may be important from a psychological standpoint Remember this game we call investing is akin to poker in that we are playing the other players John Maynard Keynes said the stock market was like a beauty contest where the judge s job was not to choose the most attractive contestant but rather to choose the contestant the other judges deemed the most attractive It sounds similar and it is but getting it right means knowing as much about the judges as the contestants So the rally and subsequent correction may be important to the future course of the stock market if it affects how other investors perceive the market With all the easy money trades blowing up recently investors may start actually thinking before they jump into the latest new fangled investment they don t understand Nah that s not going to happen
A big part of the sell off Monday was an unwinding of the short volatility trade that had become ubiquitous How ubiquitous In August of last year the New York Times ran an article about Seth Golden a former Target logistics manager who ran his net worth from 500k to 12 million in five years shorting various volatility linked securities Stock markets have been remarkably calm this entire bull market and betting that it would stay that way had become the most crowded trade on the street I hope Mr Golden put some of that 12 million aside in something safe because the trade came unglued over the last couple of days with the VIX spiking to over 50 from record lows under 10 Being short something that goes up by five times in a few days is a great way to do a round trip back to Target logistics manager not that there s anything wrong with that
The VelocityShares Daily Inverse VIX Short Term linked To SP 500 VIX Short Fut Exp 4 Dec 2030 NASDAQ XIV a popular short volatility trading vehicle for retail investors traded at a high of 146 44 on January 11 It closed today at 7 34 and will be liquidated later this month by its sponsor Stories are already emerging of amateur traders blowing small fortunes earned over a few years of shorting vol in a few days I have zero sympathy for them If God wanted us to have free lunches He would have given us Star Trek replicators by now
Likewise bitcoin which while not directly related to the stock market swoon is also an easy money trade suddenly not so easy I took some heat for saying that Bitcoin s intrinsic value is zero and even under 6000 this morning it still is way above nil but it is down from 20 000 not an insignificant drop of 70 On second thought is the great cryptocurrency massacre related to the stock market swoon Is it just coincidence that we see a rise in volatility just as the Fed starts to reduce the size of its massive balance sheet Volatility is nothing but the inverse of liquidity and reducing the size of the balance sheet would seem to qualify as a liquidity reducing event And I would also note that the reduction in January was the largest monthly drawdown since they announced their balance sheet diet plan The Fed itself well Bernanke said that QE would raise asset prices and produce a wealth effect and he seems to have been right about that although not much and not much else in my opinion Shouldn t a reversal produce the opposite Or was QE another free lunch
I don t know whether the reversal of QE is responsible for the recent stock market selloff or the bitcoin selloff It may be nothing more than an interesting coincidence What I do know is that there was little change in the fundamentals of the market since January 26th when we made the all time high If anything as you ll see below the fundamentals improved It just goes to show once again that the market is not the economy and the economy is not the market Somewhere around 2 85 on the 10 year Treasury note yield good news for the economy suddenly turned into bad news for stocks Or at least that is the most popular reason cited for the selloff Supposedly the average hourly earnings reported as part of the full employment report incited inflation fears and the prospect of more or faster tightening by the Fed spooked the market Flighty thing isn t it
There are lots of problems with that narrative and you can go read about it if you feel the need I d just remind you before you do that we ve seen these one month pops plenty of times before and they turned out to be nothing One month does not a trend make Janet Yellen has been waiting patiently for the Phillips Curve to kick into high gear this entire business cycle and I doubt that it finally showed up her last day on the job Did the market sell off because interest rates are rising I suppose that could be part of the cause but stocks were fine when rates were 10 basis points lower What was it about that last 10 basis points that flipped the switch to sell Or did the market sell off because Yellen decided her exit interview would be an excellent time to tell the public that gee look at that stocks sure are expensive Or maybe it sold off because her successor Jerome Powell is seen as less likely to have the market s back if things start to get ugly Or maybe it was because Yellen decided to throw Wells Fargo NYSE WFC under the bus on her way out the door Or maybe as is most often the case we really don t know what motivated sellers
The volatility of the last few days is really nothing more than markets getting back to normal It is the complete lack of volatility the last few years that is abnormal And it is that lack of volatility provided by the Fed s obsession with transparency and a huge dollop of excess liquidity that led investors to believe they had discovered a perpetual money machine in the short vol trade The Fed s obsession with stamping out all kinds of volatility economic and market has led our economy to this state where Target logistics managers find it more appealing and profitable at least for a while to speculate in derivatives than manage logistics Here s hoping there is no such thing as the Powell put
By the way we think the most important decisions you make are the ones you make before you invest What do you do when we get these episodes of volatility Do you have a process to follow or will you succumb to emotion You can do a lot of right things minimize costs by using index funds for instance and it won t matter a bit if you make emotional decisions Now on to our market indicators that guide our investment process
Yield Curve
As I said above some of our economic indicators actually improved since the last update and the yield curve is one of them The 10 2 curve actually steepened a small amount since the last update And it is in a bullish way with long term rates moving up faster than short term rates It isn t a large move and it may get reversed in time but it is in the right direction
More important I think is that the rise in long term rates has been driven by a rise in real rates an indication that real growth expectations are rising Yes there has been a rise in inflation expectations too but the most recent move was more about real growth 10 year iShares 0 5 Year TIPS Bond NYSE STIP yields have returned to the top half of the trading range that has prevailed since mid 2013 A break out that is sustained would be very good news for the economy Would it be good for stocks Long term almost certainly Short term Maybe not Again the economy is not the market and the negative of higher interest rates may offset the positive of better growth for a while But this hasn t broken to new highs yet and I don t see any reason to try and anticipate the next move
Credit Spreads
Spreads widened by 20 basis points since the last update on 1 4 and 37 basis points since the stock market peak on 1 26 Such a small move is not sufficient to warrant an allocation change
Valuations
The market selloff was not large enough to change valuations by any significant amount Earnings estimates have been rising though as analysts factor in tax cuts So far it looks like bottom up estimates are up about 4 for Q1 which is consistent with my thinking but may be somewhat less vigorous than the market expects On the other hand I would just note that the largest part of the expected rise in earnings for 2018 is in the energy sector And those gains are largely dependent on analysts predictions about oil prices which seems pretty shaky ground upon which to build an investment story As I ve noted before much of the gain in corporate investment over the last 18 months has been from drilling new wells after the oil price recovery To achieve a more balanced expansion we need to see a handoff from the energy sector to other parts of the economy and so far I don t see it The rise in real rates is a positive note in that regard though and certainly worth watching
Momentum
Obviously short term momentum for the S P 500 has turned lower but longer term measures are so far only correcting the previous overbought condition We tend to focus on intermediate and long term momentum and put a lot less emphasis on short term measures We are getting the expected bounce right now and how that plays out could play a big role in whatever moves we make or don t in coming months
One of the interesting things about this correction is that it was not accompanied by what we ve come to expect in these episodes The rise in volatility was in many ways a global event and I would have expected the dollar to rally But the response was tepid at best and I think goes to demonstrate the disdain for the dollar globally I still think a move back up to the low 90s is likely before resuming the downtrend We may have corrected one of the markets at an extreme stocks but there are others where speculators still haven t gotten their comeuppance The long Euro trade is very crowded right now
We have been overweight international assets for over a year because of the falling dollar and it has been a good decision in some ways Long term momentum still favors international over US stocks but it has not been a smooth transition iShares MSCI EAFE NYSE EFA did outperform SPY NYSE SPY on this pullback though with a top to bottom move of less than 8 while SPY almost hit 10 And the weekly trend is intact although momentum is not supportive right now Still my focus is on the long term momentum shift Currency trends tend to be long lived and history tells us that international assets tend to outperform when the dollar is falling
The correction in EM stocks was about the same as the US and short term momentum there has also rolled over But intermediate and long term momentum remain positive and EM stocks continue to outperform the more general international indexes
Japan s correction was similar to the overall EAFE drop of around 8 Japan continues to outperform iShares MSCI EAFE NYSE EFA short term and the long term shift continues to favor Japan as well I am considering shifting some from EFA to EWJ but I want to see whether the Yen breaks out and how that impacts the market if it does I swapped from WisdomTree Japan Hedged Equity NYSE DXJ to iShares MSCI Japan NYSE EWJ a couple of years ago and that has been to our benefit but the Yen uptrend stalled in 2017
The weak dollar continues to support commodity prices The commodity ETFs corrected with stocks but much less severely
Similar to the long term momentum shift to international equities the weak dollar is also influencing the long term shift in momentum to commodities from stocks It is tenuous but ongoing
Gold also performed well during the correction
Not much in the bond area performed well but TIPS continue to outperform nominal Treasuries
There weren t many winners over the last month but all of them are weak dollar related in a way The losers are concentrated in interest sensitive items with REITs taking it on the chin as US rates rose
There are no changes to the portfolios this month As a reminder here is the moderate portfolio allocation I posted last month
By the way as a firm we did some rebalancing in January to bring these percentages back to the targets We also rebalanced all of our passive accounts which mostly meant selling stocks and buying bonds If you haven t rebalanced in a while you probably ought to consider it If you don t know what rebalancing is please get in touch with us Soon |
WFC | Bank Of England s Feb Super Thursday | The Bank of England is expected to proceed largely as normal today on Super Thursday when the central bank releases its policy decision and statement plus the Inflation Report
US Fed s Dudley spoke at an event jointly hosted by Thomson Reuters and the European American Chamber of Commerce in New York about Banking Culture Dudley made comments that there has been progress in bank culture but more can be done They are not expecting a huge bank deregulatory swing The Fed is focused on feedback loops in the markets The stock market bump has no effect on economic outlook but a sustained drop would impact outlook The market is generally functioning OK and general liquidity is pretty good The Fed will continue to study the effects of regulations on liquidity
US Consumer Credit Change Dec was 18 45B v an expected 20 00B from a previous 27 95B
The Reserve Bank of New Zealand Interest Rate Decision was left on hold as expected at 1 75 The Rate Statement and the Monetary Policy Statement were released at the same time Some of the comments from the RBNZ were that policy will remain accommodative for a considerable period The forecast is for rates to rise in the second quarter of 2019 Numerous uncertainties remain and policy may need to adjust The RBNZ sees inflation reaching 2 in Q3 of 2020 versus Q2 of 2018 It cut the Q1 2018 growth forecast to 0 8 from 1 2 previously The move in NZD is largely due to the move in USD The CPI is forecast to trend upwards towards the midpoint of the target and domestic economic growth is projected to strengthen House price inflation has increased somewhat but housing credit growth continues to be moderate Labor market conditions continue to improve The RBNZ has revised down the impact of new government policies in the near term The NZD USD fell to session lows of 0 72088 when this data was released
Comments from the RBNZ Press Conference discussing the rate decision and monetary policy statement were that the next rate move could be up or it could be down Market volatility is seen as a bit of a warning sign and shows nervousness towards interest rate normalization but there was no reason to change forecasts after equity market volatility The RBNZ remains confident about heading towards the inflation target and that its policy stance is sensible If volatility translates into interest rate markets it would be an upside risk on the bank s interest rate track RBNZ Governor Spencer said that we are reasonably close to a neutral level of unemployment About the NZD he stated he is not concerned about it is comfortable where it is and expects it to drift lower but stay in this vicinity and normalization of rates will happen the risk is if it happens quickly The NZD USD has continued its decline to 0 71804
US FOMC Member Williams spoke at a community leader s luncheon in Honolulu Hawaii He does not see the economy as a bubble or headed into overdrive and he sees inflation picking up this year He said that he can see productivity continuing to moderate The Federal Government has an unsustainable fiscal path and the Fed is focusing on inflation as the job market has tightened He said that he is not worried about the debt crisis right now and if the economy continues to add 2M jobs this year he expects to see inflation pressures The recent market turmoil has not changed policy or economic outlook The US economy can clearly handle gradually rising interest rates He also made the comment that the goal of Wells Fargo NYSE WFC penalties was to send a message banks in the US must follow laws and regulations
Japanese Foreign Bond Investment Feb 2 was 886 6B from 41 1B previously which was revised down to 16 4B Foreign Investment in Japanese Stocks Feb 2 came in at 126 7B from 300 5B previously which was revised up to 171 8B USD JPY hit a low of 109 114 after the release before retracing higher
Chinese Exports YoY Jan were 11 1 v an expected 9 6 from 10 9 previously Imports YoY Jan were 36 9 v an expected 9 8 from 4 5 previously Trade Balance USD Jan was 20 34B v an expected 54 10B from a prior 54 69B Exports CNY YoY Jan were 6 0 from 10 8 previously which was revised down to 7 4 Imports CNY YoY Jan was 30 2 from 18 7 previously Trade Balance CNY Jan was 135 80B v an expected 325 00B from a prior of 361 98B The miss in the trade balance has caused USD CNH to move up 0 50 to 6 35201
Japanese Economy Watchers Survey Current Jan was 49 9 v an expected 53 7 from 53 9 prior Economy Watchers Survey Outlook Jan was 52 4 v an expected 53 5 from 52 7 prior USD JPY continued its move higher to reach 109 766 from 109 557 when the data was released
EUR USD is unchanged overnight trading around 1 22636
USD JPY is up 0 42 in early session trading at around 109 765
GBP USD is up 0 08 to trade around 1 38890
USD CNH is up 0 62 overnight trading around 6 35860
NZD USD is down 0 75 overnight at around 0 71828
Gold is down 0 55 in early morning trading at around 1 310 70
WTI is down 0 15 this morning trading around 61 51
Major data releases for today
At 07 00 GMT German Current Account n s a Dec is expected to be 25 0B from a previous 25 4B Exports MoM Dec are expected to be 1 0 from 4 1 previously Imports MoM Dec are expected to be 0 5 from 2 3 previously Trade Balance s a Dec is expected to be 21 7B from a prior 22 3B EUR pairs could move because of this data release
At 08 45 GMT German Buba President Weidmann will speak on Monetary Policy in the European Context at the Monetary and Economic Policies on both sides of the Atlantic conference in Frankfurt
At 09 00 GMT RBA Governor Lowe will be speaking at the A50 Australian Economic Forum in Sydney His comments have the potential to influence trades on AUD
At 13 30 GMT the Bank of England Interest Rate Decision is expected to be left unchanged at 0 5 The BOE Minutes BOE Quarterly Inflation Report and the Monetary Policy Statement will be released at the same time The BOE Asset Purchase Facility is expected to come in unchanged at 435B GBP crosses could see a spike in volatility after this data is released
At 13 15 GMT Canadian Housing Starts s a YoY Jan are expected to be 210K from a previous 217K
At 13 30 GMT US Initial Jobless Claims Feb 2 are expected to be 232K from a previous 230K Continuing Jobless Claims Jan 26 are expected to be 1 945M from 1 953M previously
At 14 00 GMT US FOMC Member Kaskari will be speaking USD crosses and US assets may experience volatility around this time in reaction to his comments and audience questions
At 14 00 GMT Canadian BOC Governing Council Member Wilkins will be speaking on innovation and inclusive growth at the G7 Symposium in Quebec CAD crosses could be volatile around this time in reaction to comments made |
EBAY | EBay EBAY Posts Q1 Earnings Beat Revenue Climbs 4 | eBay Inc NASDAQ EBAY just released its first quarter 2017 financial results posting earnings of 0 49 per share and revenues of 2 22 billion Currently eBay is a Zacks Rank 3 Hold and is down 0 13 to 33 81 per share in after hours trading shortly after its earnings report was released
Beat earnings estimates The company posted earnings of 0 49 per share excluding 0 51 from non recurring items topping the Zacks Consensus Estimate of 0 40 per share
Beat revenue estimates The company saw revenue figures of 2 22 billion beating our consensus estimate of 2 21 billion
eBay s revenue was 2 22 billion up 4 from 2 14 billion last quarter The company s increased quarterly revenue was spurred in part by its revamped web platform eBay added two million active buyers across its platforms in the first quarter which helped lead to a 20 9 billion Gross Merchandise Volume
eBay generated 582 million of operating cash flow and 447 million of free cash flow The company repurchased 350 million of common stock
eBay expects net revenues between 2 28 billion and 2 32 billion in the second quarter For full year 2017 the company expects net revenues between 9 3 billion and 9 5 billion
The first quarter was a strong start to the year with accelerating growth in active buyers revenue and our core U S business Devin Wenig eBay s president and CEO said in a press release
We are on the right path as we continue to evolve our shopping platform for consumers leverage our technology advantages and market a sharpened eBay brand globally
Here s a graph that looks at eBay s Price Consensus and EPS 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 in the United States and country specific sites in the United Kingdom Canada Germany Austria France Italy Japan Korea and Australia Company Press Release
Check back later for our full analysis on eBay s earnings report
5 Trades Could Profit Big League from Trump Policies
If the stocks above spark your interest wait until you look into companies primed to make substantial gains from Washington s changing course Today Zacks reveals 5 tickers that could benefit from new trends like streamlined drug approvals tariffs lower taxes higher interest rates and spending surges in defense and infrastructure |
EBAY | EBay EBAY Beats Earnings And Revenue Estimates In Q1 | eBay Inc s NASDAQ EBAY first quarter 2017 earnings and revenues came ahead of expectations Earnings of 43 cents per share surpassed the Zacks Consensus Estimate by 3 cents Adjusted earnings per share exclude one time items but include stock based compensation expense Revenues of 2 2 billion beat the Zacks Consensus Estimate by a slight margin and came ahead of the company s guidance at the mid point The better than expected results were driven by strength in international markets growth of active buyers integration of the Ticketbis acquisition expansion of new user experience and brand advertising eBay added 2 million active buyers in the first quarter taking the total to 169 million eBay is currently replatforming itself and there was significant progress on this front in the first quarter The company accelerated its efforts by building product catalogs on structured data enhancing mobile platform rolling out new browse inspired shopping journeys rejuvenating customer to customer C2C business and strengthening its brand In the first quarter Marketplace rolled out a number of new consumer experiences built on eBay s structured data efforts The company also rolled out a new personalized homepage in Netherlands and announced new services like Guaranteed Delivery program on 20 million items that arrive in three days or less An authentication program to enhance consumer confidence related to high end merchandise purchase was also introduced Further StubHub became the official ticket resale marketplace for the Los Angeles Angels and Toronto Blue Jays Classifieds launched a personalized homepage feed on Marktplaats nl and continued integrating inventory with the Marketplace platform across multiple regions At the call management sounded upbeat about its recent deal with Flipkart and expects it to help eBay increase penetration in India 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 Over the last one year the stock underperformed the Zacks Internet Commerce industry It gained 36 9 compared with the industry s gain of 37 4 eBay Inc Price Consensus and EPS Surprise Let s delve deeper into the numbersRevenuesGross revenues of 2 2 billion were up 3 7 on a year over year basis up 7 on an Fx neutral basis In the first quarter the Marketplace platform contributed 20 billion of gross merchandise volume GMV and 1 8 billion of revenues Marketplace GMV grew 2 year over year on a reported basis and 5 on an FX Neutral basis On the other hand StubHub also showed signs of accelerated growth with contribution of 916 million of GMV up 6 on a year over year basis and revenues of 210 million up 18 year over year on a reported basis and 19 on an FX Neutral basis Classifieds platforms also performed well with contribution of 199 million of revenues up 7 year over year on a reported basis and 10 on an FX Neutral basis Gross merchandise volume grew 2 year over year on a reported basis and 5 on an Fx neutral basis Active buyers customers increased 4 3 from the year ago quarter Margins and IncomePro forma gross margin for the quarter was 77 1 down 78 basis points bps year over year and 74 bps sequentially Cost of revenues increased 8 on a year over year basis primarily due to expenses associated with TicketbiS operations and the expansion of first party inventory program in Korea Adjusted operating expenses of 1 1 billion increased 10 4 from the prior year quarter but decreased 5 2 sequentially Operating margin shrank 390 bps year over year and 196 bps sequentially to 25 3 Excluding the impact of intangibles amortization and other items on a tax adjusted basis pro forma net income came in at 467 million compared with 481 million in the year ago period Including the special items GAAP net income was 1 03 billion 94 cents per share compared with 482 million 41 cents per share in the year ago quarter Balance Sheet and Cash FloweBay s balance sheet is highly leveraged with total debt of 9 billion eclipsing cash and short term investments balance of 6 8 billion The company generated 582 million in cash from operating activities and spent 135 million on capex Share repurchases were 350 million in the quarter OutlookFor the second quarter of 2017 eBay expects revenues to grow 5 7 on a Fx neutral basis to 2 28 billion 2 32 billion The Zacks Consensus Estimate is pegged at 2 32 billion Non GAAP earnings are expected within 43 cents 45 cents The Zacks Consensus Estimate is pegged at 39 cents GAAP earnings per share from continuing operations are expected in the range of 20 cents 40 cents In 2017 eBay expects revenues to grow 6 8 on an Fx neutral basis to 9 3 billion 9 5 billion Zacks RankCurrently eBay carries a Zacks Rank 3 Hold You can see Zacks 2017 IPO Watch ListBefore looking into the stocks mentioned above you may want to get a head start on potential tech IPOs that are popping up on Zacks radar Imagine being in the first wave of investors to jump on a company with almost unlimited growth potential This Special Report gives you the current scoop on 5 that may go public at any time One has driven from 0 to a 68 billion valuation in 8 years Four others are a little less obvious but already show jaw dropping growth |
EBAY | Why We Are Still Avoiding Ebay Stock | Our outlook on eBay Inc NASDAQ EBAY has been negative since early 2015 And indeed eBay stock went exactly nowhere after moving up and down during the rest of 2015 and the first half of 2016 Things changed in the second half of last year when the bulls decided they have had enough and lifted the price to a new all time high The uptrend continued and as of today eBay shares will cost you more than 34 a piece Does this mean it is time to give up and start buying According to the the answer is still no The following price chart explains why
The weekly logarithmic chart of eBay stock allows us to see the wave structure of the entire uptrend since March 2009 It has been more than 8 years Enough time for the price to draw a complete five wave between 4 17 and 34 74 so far Waves I and IV even obey the rule of alternation since wave I is a sharp zig zag while wave IV is an Furthermore the structure of wave V can hardly be any clearer Unfortunately for investors the Elliott Wave theory postulates that every impulse is followed by a correction of three waves of similar magnitude in the opposite direction So instead of trusting the bulls and joining them near 34 a share we think we would be better off to continue avoiding eBay stock for now because a major pullback is likely to occur soon Calling a top is difficult of course which is why shorting is also not recommended The best decision it seems is to simply stay aside
In conclusion
eBay stock has been rising for over 8 years
the trend seems to be exhausted
from an Elliott Wave perspective staying aside is preferable right now |
WFC | Morgan Stanley Is Hunkering Down for Summer of Rising Volatility | Bloomberg Wall Street strategists have a word of warning for investors hoping to recuperate this summer after a tumultuous stretch of market trading Don t rest on your laurels
While the sunny season in Western Europe and the U S is typically characterized by lower trading volumes a multitude of political risks from Brexit to trade frictions aren t showing signs of letting up
We re heading into a summer that is going to remain volatile Andrew Sheets Morgan Stanley s London based head of cross asset strategy said in an interview with Bloomberg TV s Francine Lacqua
We have upcoming headlines on steel tariffs we have upcoming headlines on China trade negotiations we have Nafta we have an uncertain political backdrop in Italy we have a new government potentially in Spain There s a lot for the market to digest
Sheets recommends taking positioning down and paring risk exposures to a more neutral stance Even as jitters over Italy s new populist government abate its ability to lead is already being questioned by the likes of George Soros who warned over the weekend that differing agendas could spark renewed crisis and may ultimately doom the coalition
Italy is the bigger uncertainty Sheets said We re still not sure what the first steps the government take are
Meanwhile the stars may be aligning to extend the dollar s lucky break tightening financial conditions for overseas borrowers and increasing the prospect of volatility for embattled emerging markets
The dollar s outlook over the summer remains bullish Mansoor Mohi uddin head of FX strategy at Natwest Markets Plc wrote in a note He cites Federal Reserve rate hikes trade protectionism and the European Central Bank s challenge to normalize policy amid political risks in the euro area
Perfect storm
A fraught summer of Brexit negotiations meanwhile threatens to overtake Bank of England policy as the biggest driver of the pound according to strategists at ING Groep AS INGA NV A summit with European Union officials kicks off at the end of the month ahead of Britain s scheduled exit in March 2019 with the U K still struggling to forge a proposal on post Brexit customs arrangements
For credit investors it s time to get defensive to weather what is likely to be a relatively volatile summer according to Wells Fargo NYSE WFC Co strategists led by George Bory They cite heightened concerns about trade wars and the prospect of tighter monetary policy overshadowing an otherwise healthy economic backdrop
There could be one silver lining U S high grade supply may continue to be unusually muted over the coming months thanks in large part to tax reform according to Peter Tchir the New York based head of macro strategy at Academy Securities Inc |
WFC | Delaware sports betting first out of gate but competitors close in | By Laila Kearney NEW YORK Reuters Delaware gained a competitive edge on Tuesday in newly legal sports betting as the first U S state in a quarter century to expand its athletics gambling program but the boost could be short lived as rival states close in analysts said At 1 30 p m EDT the second smallest state went live accepting bets on a gamut of professional sports the first to roll out its betting program since last month s U S Supreme Court decision struck down a 1992 ban Delaware also became the only East Coast state to offer legal athletics wagering Being first out of the gate may offer some first mover advantages said Randy Gerardes director of municipal securities research for Wells Fargo NYSE WFC Securities in New York But it s difficult to ascertain exactly how much activity that will stimulate or how much revenue he said Along with Nevada Montana and Oregon which has since suspended its sports betting operations Delaware was given a partial reprieve from the Professional and Amateur Sports Protection Act of 1992 Under the exemption Delaware was allowed only multi game betting on professional football As of Tuesday it was set to also offer single game and future betting on professional baseball football basketball hockey golf soccer and auto racing Wagering will at first be confined to the state s three casinos and then expand online By already having limited sports betting Delaware had the rules and infrastructure in place to swiftly expand gambling options when the SCOTUS decision landed said Marcy Block senior director at Fitch Ratings in New York They were already several steps ahead of a lot of other people Block said Still Delaware and other U S states with sports gambling operations should not expect a windfall Block said We believe that it s still going to be a very small part of the overall gaming market she said In a recent analysis Moody s Investors Service said that even if every state broadly legalized athletics wagering it would generate a combined 1 5 billion annually That is less than 0 2 percent of states combined operating funds Despite Delaware s head start analysts said any competitive edge could quickly soften as more states get betting systems up and running Initially they will be able to draw customers from nearby Pennsylvania and Maryland but that s going to disappear really fast as more states enact legal sports betting said Frank Fantini who heads Delaware based gaming industry research firm Fantini Research Nearby West Virginia and Pennsylvania which have already legalized sports betting are plowing ahead with their programs New Jersey on Monday advanced its bill to legalize sports betting Elsewhere Mississippi Rhode Island and Connecticut had legalized the practice in anticipation of the SCOTUS decision More than a dozen other states have introduced legislation to legalize the practice since the ruling As those states come on line players will likely place bets close to home rather than drive across state lines to Delaware
Casinos are very much a matter of conveniences just like banks and 7 Elevens Fantini said |
WFC | More U S companies shelve refinancings as markets turn choppy | By Jonathan Schwarzberg and Yun Li NEW YORK LPC At least two more US companies have postponed opportunistic leveraged loan refinancings after failing to attract investors at the proposed terms on heightened worries about global volatility sources told Thomson Reuters LPC Looking to be better compensated for their risk lenders stood on the sidelines as tactical and operational equipment logistics company ADS Tactical and decorative lighting company VC GB Holdings marketed a total of US 925m in refinancing loans adding to a handful of other deals that have been shelved in recent weeks Lenders this year have generally been willing to allow companies to lower the pricing on their existing loan holdings as values in the secondary market have strengthened rather than allow companies to do full on refinancings and potentially losing the paper As a bevy of new deals hit the market over the last month and secondary prices have dipped investors have been focusing on which credits they really want to own I think managers are just figuring out right now what they need to sell an investor said On top of that you had a little volatility in the background while this was happening which caused the overall risk environment to pause just a little bit Meager supply for loans and a large appetite for floating rate assets has left little room for pushback this year but political turmoil in Italy and tensions with North Korea over potential denuclearization have tipped the balance When paired with increased deal activity investors now have the option to be choosy You have a little bit of weakness as you start to push back on some of the repricings so you can focus your time on the ones you like the most a portfolio manager said There s a lot of stuff on the market The SMi100 an index that tracks the 100 most widely held loans dropped slightly to 98 4 on June 4 from 98 6 on May 1 MARKET FATIGUE In addition to global macroeconomic concerns these issuers came to market at a time when investors were showing fatigue at simply allowing issuers to reprice loans at will several sources said Gaming and entertainment property owner VICI Properties automotive supplies producer American Axle Manufacturing and handling systems maker MHS Holdings all postponed repricings in late May as previously reported by Thomson Reuters LPC ADS Tactical originally proposed a new US 330m seven year term loan to refinance its existing term loan due in 2022 and senior secured notes due in 2022 Guidance initially went out at 425bp over Libor and after receiving pushback the company increased the spread to 525bp over Libor and revised the structure to include a US 250m term loan and a US 75m secured note but the deal was ultimately shelved We were just testing the waters said John Dunn chief financial officer at ADS It just wasn t good enough for us to pull the trigger to move forward with it Wells Fargo NYSE WFC led the ADS deal and did not return a request for comment VC GB Holdings known as Visual Comfort also postponed a US 595m covenant lite seven year term loan B The company circulated guidance of 325bp over Libor on the loan which was slated to pay down a US 505m first lien term loan due in 2024 and a US 150m second lien term loan due in 2025 Deutsche Bank DE DBKGn led this transaction and declined comment Visual Comfort did not return requests for comment The market s disinterest in the deals does not reflect investors concerns with the credits or an obvious weakness in the credit markets Rather these deals represent a rebalancing of the market a banker said |
WFC | Rising exports push U S trade deficit to seven month low | By Lucia Mutikani WASHINGTON Reuters The U S trade deficit fell to a seven month low in April as exports rose to a record high lifted by an increase in shipments of industrial materials and soybeans Wednesday s report from the Commerce Department was the latest sign of robust economic growth in the second quarter But a protectionist trade policy being pursued by President Donald Trump which has seen the United States slapping tariffs on imports from a host of countries including China Mexico and Canada as well as those in the European Union poses a threat to the otherwise rosy economic outlook One is hard pressed as to not concur that the U S economy not only remains on solid footing but is likely to show an accelerated pace of growth in the second quarter said Sam Bullard a senior economist at Wells Fargo NYSE WFC Securities in Charlotte North Carolina Still trade tensions remain a threat to the outlook and clearly have the potential to derail economic growth he said The Commerce Department said the trade gap narrowed 2 1 percent to 46 2 billion the smallest since September Data for March was revised to show the trade deficit falling to 47 2 billion instead of the previously reported 49 0 billion Economists polled by Reuters had forecast the trade deficit unchanged at 49 billion in April When adjusted for inflation the trade gap narrowed to 77 5 billion from 78 2 billion in March The so called real trade deficit is below its 82 5 billion average in the first quarter If the trend in the real trade deficit is maintained trade could contribute to gross domestic product in the second quarter after having a neutral impact in the January March period Prices for U S Treasuries were trading lower The dollar fell against a basket of currencies while stocks on Wall Street rose Trump in March announced tariffs on steel and aluminum imports to protect domestic industries from what he says is unfair competition from foreign producers Last week he extended the duties to steel and aluminum imports from Canada Mexico and the European Union Mexico has retaliated with measures targeting a wide range of U S farm and industrial products Canada has said it would slap tariffs on imports from the United States including whiskey orange juice steel aluminum and other products Exports to Mexico Canada and the European Union have recorded double digit growth so far this year RISKY TRADE STRATEGY We fail to understand the strategy of risking a trade war with Europe Canada and Mexico particularly at a time when the U S appears to be expanding strongly in these markets said John Ryding chief economist at RDQ Economics in New York A trade war is also brewing with China Washington and Beijing have threatened tit for tat tariffs on goods worth up to 150 billion each Trump claims the United States is being taken advantage of by its trading partners but economists warn that tariffs will undercut the economy raising prices and destroying jobs for Americans Economists say tariffs will do little to shrink the trade deficit partly because of the dollar s status as the global reserve currency and the low U S saving rate including a fiscal deficit that has been blown up by a 1 5 trillion tax cut package The politically sensitive goods trade deficit with China increased 8 1 percent to 28 0 billion in April The United States had a 0 8 billion goods trade deficit with Canada and a 5 7 billion shortfall with Mexico Exports of goods and services rose 0 3 percent to a record 211 2 billion in April It was the third monthly increase in exports They were in April supported by a 1 3 billion increase in deliveries of industrial supplies and materials such as fuel oil and petroleum products Exports of industrial supplies and materials were the highest on record in April Soybean exports increased 0 3 billion and corn shipments also rose by a similar amount But exports of commercial aircraft tumbled 2 8 billion Imports of goods and services slipped 0 2 percent to 257 4 billion in April Imports of consumer goods dropped 2 8 billion weighed by a 2 2 billion decline in imports of cellphones and other household goods Motor vehicle imports fell 1 0 billion Economists said the drop in imports was likely temporary given strong domestic demand Crude oil imports rose 1 0 billion in April with prices averaging 54 50 per barrel
American consumers love affair with exotic foreign goods remains ongoing said Chris Rupkey chief economist at MUFG in New York Many U S companies are also hooked on foreign goods to help make their own finished products as well |
WFC | Phony bank accounts not a systemic issue U S regulator | By Pete Schroeder WASHINGTON Reuters A U S bank regulator said on Thursday that an industry wide review prompted by Wells Fargo Co s N WFC sales practices scandal had uncovered some instances of phony accounts at other lenders but little evidence of a systemic problem The Office of the Comptroller of the Currency reviewed more than 40 large and midsize banks after Wells Fargo s phony accounts scandal first erupted in 2016 wrapping up the process at the end of 2017 The full findings have not been made public The OCC said in a statement that it had not identified any systemic issues at the other banks mirroring those at Wells Fargo where bank employees had created potentially millions of unauthorized accounts in customers names to meet sales goals But the review did uncover some weaknesses in internal sales practices the OCC statement said In particular few banks had a centralized approach to risk governance over sales practices before the regulatory review The OCC said it had notified banks earlier in 2018 of any particular issues that turned up in the review and that most banks took timely actions to address those weaknesses after they were identified by the regulator The OCC also found some instances in which accounts were opened without customer consent It did not specify how many improper accounts it had found at other banks but said reasons why the accounts were opened had included sales promotions lacking in risk controls or isolated instances of employee misconduct There was no evidence that any of the unauthorized accounts found at other banks had been opened by bank employees in order to meet to sales incentives or quotas the OCC said Those banks have either already addressed any unauthorized accounts or are taking remedial action including closing the accounts and refunding any improper fees the OCC said
A Wells Fargo spokesperson declined to comment |
WFC | ITG reports May trading volume | NYSE ITG U S trading volumes of 2 7B shares average daily volume of 124M shares for 22 trading days in May against trading volume of 3 2B shares 148M of average daily volume for 22days in May 2017 19 Y Y increase in average daily trading commissions in Canadian European and Asia Pacific businesses Press Release Now read |
WFC | US Bank Wells Fargo Bans Crypto Purchases With Its Credit Cards | San Francisco based bank Wells Fargo NYSE WFC has announced that it will no longer allow its customers to purchase cryptocurrency using its credit cards Fortune reported June 11
Wells Fargo which is the third largest bank by assets in the US said that its customers are now prohibited from purchasing digital currency on their credit cards issued by the financial institution A bank spokesperson said that the decision was made in order to avoid multiple risks associated with cryptocurrency usage |
EBAY | Alibaba hasn t hit bottom yet Barron s | Reuters Shares of Alibaba Group Holding Ltd N BABA which recently slipped below their initial offering price after having rocketed 75 percent in their first two months of trading could lose another 50 percent of their value Barron s said in the cover story of its Sept 14 issue The reasons the weekly financial newspaper gave for the dour outlook China s struggling economy increasing competition in e commerce and more scrutiny of the company s culture and governance Alibaba spokesman Bob Christie said the article contains factual inaccuracies and selective use of information and the conclusions the reporter draws are misleading The company has posted on the internet a letter to Barron s editor complaining about the story The company runs two big retail websites and recently warned of lower than expected transaction volumes after having reported that volume growth in the June quarter declined to 34 percent from the 50 percent plus rates of the past That may only worsen as China s economic growth drops to its lowest pace in six years Barron s said The recent share price puts a market value on the company of 160 billion But the stock is trading at about 25 times the average earnings estimate from analysts and Barron s said it should be closer to the 15 times multiple of eBay Inc O EBAY
Alibaba said in its letter that the price earnings multiple comparison is flawed and a more appropriate comparison would be to Chinese peers rather than eBay which does not operate in China |
EBAY | Tencent eBay join Kakao bid for new South Korean Internet bank | SEOUL Reuters Kakao Corp the operator of South Korea s largest mobile messaging app said Tencent Holdings Ltd and eBay Inc NASDAQ EBAY have joined its bid for a new South Korean Internet bank license Tencent and eBay will make their investments through subsidiaries which are expected to take stakes of 4 percent or less in the bank should a license be gained a Kakao spokesman said He declined to comment on financial terms South Korea is expected to grant one or two licenses for Internet banks this year Kakao s bid is one of at least three known bids
An Internet bank provides banking and financial services without physical branches |
EBAY | Mets winning mojo helps team flex post Madoff financial muscle | By Ben Klayman Reuters Fans of the New York Mets had bemoaned the negative impact of the Bernie Madoff financial scandal on the Major League Baseball team s payroll until Thursday night s series clinching victory over the Los Angeles Dodgers With believers now dreaming of the team s first World Series appearance since 2000 the Mets have enjoyed a similar boost off the field with higher attendance and TV ratings That leads analysts and bankers to believe the club could be at the start of a virtuous cycle where winning begets higher revenue and even more winning for years to come Fresh off advancing to the National League Championship Series against the Chicago Cubs another rising team with a compelling hard luck history the Mets have combined low cost young talent with the amenities of a relatively new home park Citi Field which opened in 2009 The best of seven Mets Cubs series begins on Saturday The stadium combined with aggressive marketing combined with youth hope are a great triple play said Rick Horrow sports lecturer at Harvard Law School That optimism seemed far away when owners Fred Wilpon and Saul Katz were caught up in Madoff s Ponzi scheme which was uncovered in late 2008 and cost investors 17 billion in principal While Wilpon denied it analysts and bankers said the scandal certainly led to the team s lower payrolls The Mets in 2009 had the second highest payroll in baseball at 142 2 million but that fell to 21st last year at 84 million according to Baseball Prospectus This year it has risen to 101 3 million which still ranks as 21st In 2010 the trustee in charge of recovering money for Madoff victims filed a 1 billion lawsuit against Wilpon Katz and more than 100 other defendants claiming they turned a blind eye to the fraud a charge they denied The figure was later limited to 386 million by a federal judge Wilpon and Katz settled that lawsuit in 2012 by agreeing to give up their claims to all but 16 million of the 178 million they lost in the Madoff fraud though it is unlikely they will recover any funds In addition the settlement calls for Wilpon and Katz to pay as much as 29 million over the next two years to help repay other Madoff customers who lost money in the scheme But the team and its finances are now on an upward trajectory We were trending upward before the start of the season Mets chief revenue officer Lou DePaoli said citing ticket sales and sponsorship deals Both have accelerated particularly over the past two months and we are already in the process of working to grow all these elements for 2016 YOUTH DRIVEN REBOUND The Mets have racked up wins on the field relying on young inexpensive star pitchers like Jacob deGrom and Noah Syndergaard which allowed the team to also add Cuban slugger Yoenis Cespedes in July This week s playoff run glued some of the biggest names on Wall Street and finance to their TVs laptops or smartphones for Thursday night s clinching divisional series win against the Dodgers Devin Wenig CEO of eBay Inc O EBAY attended last weekend s games in Los Angeles As a displaced New Yorker I have carried my love of the Mets to Silicon Valley he told Reuters There is a sense of renewal for a franchise long overdue for its moment in the spotlight Mohamed El Erian the chief economic adviser for financial services company Allianz SE DE ALVG and self described long suffering fan posted a congratulatory tweet Mets Cubs Should be a great NLCS Congratulations Mets and LetsGoMets The team s winning this year has helped boost attendance and TV ratings which translates to higher revenue pushing the value of the franchise higher Forbes magazine valued the team at 1 35 billion in March the seventh highest valuation in the sport and up 69 percent from the year before Only three other teams had higher estimated growth Mets attendance totaled 2 569 753 people this season an increase of 18 percent from last year However that still lags the more than 3 1 million the team drew in Citi Field s first year in 2009 and analysts said there is no excuse for a New York team not to draw at least 3 million fans When you have teams like the Mets that have struggled for a few years when the team starts to perform well it is really heartening for our business to see the fans flock back MLB Commissioner Rob Manfred told Reuters REVENUE SWEET SPOT While ticket prices at Citi Field rank only 18th in the 30 team league at an average of 25 apiece according to Team Marketing Report there is risk with raising prices too fast and then having a possibly mediocre 2016 said Robert Tilliss chief executive of sports banker Inner Circle Sports You ve generated a little bit more revenue in that case but now you ve agitated your fan base It s definitely a delicate balance he said One element in the team s favor is a wealthy fan base that has been waiting for a winner to return which suggests huge upside for team revenue It s kind of like cicadas said Marc Ganis president of consulting firm Sportscorp Ltd They stay dormant under the ground but my goodness when they come out seven years later they come out in force and are as loud as can be That is reflected in higher merchandise sales almost double last year s levels compared with industry average growth of 5 6 percent Mets viewer ratings also spiked 68 percent this year on SportsNet New York the regional sports TV network the team partly owns and that translates to higher ad rates analysts and bankers said It was the most watched season since 2010 Meanwhile Madoff 77 the man blamed by many for the Mets years of losing is serving his 150 year prison term after pleading guilty in 2009 to masterminding the scheme Listed under the register number 61727 054 he is not set to be released until Nov 14 2139 according to the Federal Bureau of Prisons website
Madoff could not be reached for comment from the Federal Correctional Complex in Butner North Carolina where he is being held But there is plenty of reason for him along with Mets fans everywhere to have hopes for better days ahead for the team |
EBAY | EBAY Breaking Out | Breakout
eBay Inc NASDAQ EBAY is breaking out today as we are clearing well above the downtrend resistance red and the recent horizontal resistance blue with a strong bullish candle as the stock is up nearly 3 as I write this article We have strong Double Bottom Reversal fully confirming while cultivating a healthy uptrend characteristics of higher lows and higher highs As of today we are also now trading well above the 100SMA not shown in the chart Bullish price action
My Position Target
I ve been watching Ebay since the ER gap down back in 10 20 16 as I was anticipating for an entry When there is fear I look for an entry and when there is greed I look for an exit And definitely there has been much fear and nervousness among investors traders after it plunged about 18 since late September My plan was to buy the dip at 27ish as I ve out on 11 1 2016 In my long term forecast analysis I came to a conclusion that 27 level was a good level for a bounce
My Breakout Target is at 32 50 which I would close out about 1 2 of my positions there if we can able to clear well above 33 and stay up I think 36 37 might even be possible |
WFC | Wells Fargo Sees Stock Market Breakout | Investing com Stocks have been stuck in a volatile trading range since the correction of February but one Wall Street firm says that will soon yield to another move higher In a note to clients the Wells Fargo NYSE WFC Investment Institute says technical data indicate a breakout and a resumption of the trend that was in place before the correction The firm points to the fact that on several recent occasions the S P 500 has closed above its 200 day moving average which is viewed as a key indicator for determining long term price trends Wells says history shows that once a breakout begins investors will feel a sense of missing out on the market gains and invest new money pushing prices even higher The firm has a year end price target for the S P 500 of 2 950 which is about 3 higher than the index s record peak in late January |
WFC | Bank of Nova Scotia beats by C 0 03 beats on revenue | Bank of Nova Scotia NYSE BNS Q2 EPS of C 1 70 beats by C 0 03 Revenue of C 7 06B 7 3 Y Y beats by C 120M Press ReleaseNow read |
WFC | Wells Fargo Asset Management adds to multi asset solutions team | Wells Fargo NYSE WFC Asset Management hires Eddie Cheng as head of international portfolio management within the multi asset solutions team Cheng comes to WFC from Schroders LON SDR where he was a senior portfolio manager with its multi asset team Chenfei Ma and Stephane Renevier also recently joined WFAM s multi asset solutions team Ma as an investment analyst and Renevier as a portfolio manager Source Press ReleasePreviously Report Wells Fargo eyes Dublin hiring as Brexit plan May 18 Now read |
WFC | Wells Fargo CFO says sales practices review virtually complete | Reuters Wells Fargo Co s N WFC finance chief said on Wednesday that the bank s review process to root out possible sales practices issues was virtually complete and the lender has shared everything material it knows with investors I don t think at this point that there s anything meaningful that we aren t already talking about Chief Financial Officer John Shrewsberry told an investor conference Shareholders and analysts have been looking for signs the fourth biggest U S lender by assets will be able to put a wide ranging sales practices scandal that erupted in 2016 firmly behind it Overall while the bank has not seen a lot of attrition when it comes to established customers we haven t sold or deepened relationships as rapidly as we thought we would in terms of a recovery Shrewsberry said
Shrewsberry also said commercial loan demand was not shaping up to where he would have expected for 2018 despite the broad business optimism that has followed last year s U S tax code overhaul |
EBAY | Tinder says founder Sean Rad returning as CEO | Reuters Online dating application Tinder said on Wednesday night that it had re appointed the app s founder Sean Rad as its chief executive Rad returns after being replaced in March by former eBay Inc NASDAQ EBAY executive Chris Payne CEO We mutually determined that this wasn t going to be optimal and thought that a quick transition served everybody best the company statement quoted Payne as saying In another announcement the company said Greg Blatt will be appointed as the executive chairman of Tinder Blatt also serves as chairman of The Match Group |
EBAY | Paypal seen rising 40 percent from post spinoff lows Barron s | NEW YORK Reuters PayPal Holdings Inc O PYPL the e commerce group trading sharply off its recent offering price could rise 40 percent to 46 a share if it succeeds with investments tied to payments systems innovation the Aug 31 edition of Barron s said Spun off in July by auctioneer eBay Inc O EBAY PayPal is now clear to do deals with big vendors like Staples and move into back office operations and other services according to Barron s
PayPal shares last week traded at 34 60 or over 4 less than its offering price in July Barron s said |
EBAY | Investors Await eBay Gift Giving | eBay Inc NASDAQ EBAY recently posted 0 49 percent change and stood at 28 21 which is 31 09 percent away from its 52 week low and is down by 15 percent from its peak It posted a 5 day performance of 1 05 percent which changed hands at an average volume of approximately 10 53 million shares
The stock s 1 month performance stood at 0 93 percent and is 2 66 percent year to date at the close Additionally its outstanding shares settled at 1 08 billion sending its market capitalization at 30 39 billion The share price hit 0 77 percent versus its SMA20 5 23 percent versus its SMA50 and 3 48 percent versus its SMA200
Subsequently there were reports claiming that almost three quarters of Americans are more excited to practice gift giving to a charity eBay Inc s Giving Tuesday makes it easier than ever for shoppers give a hand to those that matter most by delivering various selection of gifts which backs nonprofits
eBay Inc Among Investors Watch ListeBay Inc reported its financial earnings for the last quarter on October 19 2016 The company belongs to Retail Wholesale sector which dropped by about 0 49 in value after settling at 28 21 in the last trading session Meanwhile the company s stock achieved 9 3 percent Return on Assets ROA 27 6 percent Return on Equity ROE and 13 percent Return on Investment ROI
The retail giant s 52 week high reached 33 19 on September 29 2016 while its 52 week low stood at 21 52 on February 8 2016 eBay Inc s earnings per share EPS stood at 1 59 according to the data The quarterly growth forecast for the retail giant is 8 percent while the estimated growth forecast for the next quarter is 8 5 percent Evidently the company s stock has grown by about 2 53 percent in the last five years
Thus analysts are expecting the company to grow by 7 7 percent in the next five more years
Analysts Recommendations Shares of eBay Inc declined 0 49 to settle at 28 21 on Tuesday with the stock price trading in a range between 28 03 29 39 The stock traded approximately 10 39 million shares beating its average daily volume of 9 83 million shares
Analysts have set a mean recommendation of 2 60 on eBay Inc s stock with less than 2 being as Buy rating 3 as Hold rating 4 as Sell rating and 5 as Strong Sell rating Moreover the stock is likely positioning below its 52 week highs and is down by 2 56 for the last five trading sessions
Current Stance of eBay Inc StocksThe chart below illustrates eBay Inc stock s movement ahead of reporting its financial earnings for the last quarter including eBay s Giving Tuesday Charity Shop Given a bullish tone on the stock it is shown here that the stock is likely attempting a consolidation below resistance 28 98 in a light trading volume Thus the stock is still prone to an upside bias after a four consecutive stocks on the green movement during earlier sessions
ConclusionAs shares of eBay Inc are currently in a bullish tone market participants are recommended to wait on the sidelines as there aren t any supporting candles present as of today s session |
EBAY | Today s Trading Plan Rate Day | Technical Analysis
The S P 500 SPX keeps marching higher with little resistance to counter its momentum rising another 14 points towards the goal of 2300
Even more so the Dow Jones Industrial Average DJIA is up 22 of the last 26 days over 84 win rate and has made new all time highs 7 days in a row
Despite all of this bullish price action you have the VIX that has risen for the fourth time in the last five days and breadth in the market isn t resoundingly strong
Today the Federal Reserve will likely announce a rate hike in its FOMC Statement at 2pm eastern followed by a press conference with Janet Yellen at 2 30pm eastern Expect there to be some volatility in price movement for the stock market
Last year when the FOMC announced its expected rate hike on December 16 2015 the market actually rallied hard that day but the two days that followed resulted in a sharp sell off
Volume on SPDRs S P 500 SPY NYSE SPY saw an increase in its volume for a second consecutive day as well as above average volume overall
If there was ever a moment for a blow off top a buy the rumor sell the news kind of price action this would be it The banks and the market as a whole has largely priced in a rate hike so it would not surprise me at all if we eventually see a sell off reminiscent to the sell off we saw in December last year
Light Sweet Crude Oil Futures CL has struggled to move beyond the trading range of the past two days and stands to sell off some today Some retraction in oil prices is likely a given at this point in time
Nasdaq COMPQ decided to get be a market leader once again and the main reason for yesterday s broad market strength
Though it went through the end of the day ritual of getting pummeled prior to the close the CBOE Volatility Index still managed to close higher on the day At this point there is a divergence in equities and the price action I am seeing on VIX but it is not drastic enough to do anything with at this point
SPX 30 minute chart remains very much overextended That is really all you can say about it at this point
My Trades
Sold eBay Inc NASDAQ EBAY at 29 98 yesterday for a 0 5 profit
I did not add any additional positions ot the portfolio
I may look to add some new swing trades to the portfolio following the FOMC Statement today
I am currently 30 Long 10 Short 60 Cash
Chart for SPX |
EBAY | eBay Inc Average Hold Rating | Several analysts issued a hold rating on the social media giant before the actual results for the quarter
eBay Inc NASDAQ EBAY stocks have been issued a consensus rating of Hold by forty three research firms that are currently covering the company Four analysts of which gave a Sell rating on the stock twenty have issued a Hold rating seventeen affirmed a Buy rating and two recommended a Strong Buy rating to the company Meanwhile the average 12 month target price among research firms that have issued ratings on the stock stood at 33 60 last year
Many analysts currently weigh in on eBay Inc stocks with Susquehanna issuing a positive rating and set a price objective of 34 00 up from 32 00 of the company s shares on July 21st Mizuho upgraded their price objective on the stock from an earlier reading of 31 00 to 32 00 and gave a neutral rating on October 20th
Eyes on eBay Inc StockMarket players are closely watching on shares of eBay Inc with a current six month price index of 1 28794 on the stock which is calculated by dividing the current share price to the share price six months earlier
In essence the ratio over one corresponds to a significant increase in the stock price in a span of six month time Thus the ratio under one suggests that the price downgraded over that specific time
Analysts Outlook
Ahead of the current six month price index of the stock private investors were also eyeing to how researchers would respond A research firm with more than 30 years of experience Zachs Research compiles all of this brokerage information and had produced rankings including analytical data
Subsequently sell side analysts are expecting eBay Inc s shares to hit as high as 24 40 with a consensus target price of 32 037
Some analysts are expecting the social media giant to post a quarterly share earnings of about 0 47 citing the reported actual earnings in the last quarter stood at 0 38 Interested parties are anticipated to wait for the moment when the company will report their actual results on January 25 2017
Current Stance of eBay Inc StockThe chart below illustrates the eBay Inc stock ahead of the most awaited earnings report on January 25 2017
Given a bullish tone of the stock market participants indulge in buying the stock and are anticipating a rally before the actual results for the quarter Thus the stock is currently prone to an upside bias as soon as the candle breaks through resistance 29 79
ConclusionAs shares of eBay Inc are currently in a bullish tone market participants are recommended to wait on the sidelines as there aren t any supporting candle present as of writing |
WFC | Golf U S Open champion Glover said on 911 call that wife was lying to police | A tape of the 911 call the wife of former U S Open champion Lucas Glover made claiming she was attacked by her mother in law released Wednesday reveals Glover answered a call back from the St John s Sheriff s Office in Florida and told police his wife was lying Yeah hi I think we got our lines crossed here This is the husband the sane one of the bunch Glover says on the call My wife has called you Now she s trying to blame it on my mother which is not the case at all My wife has gone crazy Krista Glover was arrested Saturday in Ponte Vedra Beach Fla for allegedly attacking Lucas Glover s mother during an altercation after he missed the 54 hole cut at The Players Championship Krista Glover was taken to St John s County Jail before being released on 2 500 bond Sunday She is facing misdemeanor charges of domestic violence and resisting arrest According to the incident report she attacked her husband s mother when the latter tried to intervene during an altercation between Lucas Glover and his wife After being arrested police say Krista Glover became combative and unruly and repeatedly kicked the car door The arrest reports also states Lucas Glover told the deputy his wife calls him a loser among other insults after he plays poorly in a tournament and that she had been drinking The world s 104th ranked golfer Lucas Glover was one of nine players to be eliminated from The Players under the made cut did not finish designation after 54 holes During the call Lucas Glover told the sheriff s office that sending a rescue squad wouldn t be necessary He also told the operator she couldn t speak to his wife saying She s going to lie to you That s what I m telling you That s why I answered the phone She s telling lies She s in the house with my daughter And when deputies get here they need to talk to the male that would be me because these other two are out of their heads at the moment Lucas Glover tweeted a statement on Tuesday reading On May 12 my wife and mother were involved in an argument to which the police were called Everyone is fine Regrettably although Krista was charged we are comfortable that the judicial system is able to address what actually happened and Krista will be cleared in this private matter We thank you for respecting our privacy as we work through this unfortunate situation
Lucas Glover won the 2009 U S Open and has two other career PGA wins with the most recent coming at the Wells Fargo NYSE WFC Championship in 2011 Field Level Media |
WFC | Wells Fargo employees altered business customers information WSJ | Reuters Some employees in a Wells Fargo Co N WFC unit that handles business banking improperly changed information on documents related to corporate customers the Wall street Journal reported on Thursday citing people familiar with the matter Wells Fargo s shares were down 1 4 percent in early trading The employees in Wells Fargo s so called wholesale unit which is separate from its retail bank added or altered information without customers knowledge the Journal reported The information added varied from social security numbers to addresses to dates of birth for people associated with business banking clients 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 the report said Wells Fargo became aware of the behavior in recent months from employees according to the Journal The bank has reported the problem to the Office of the Comptroller of the Currency and the agency is probing the problem the WSJ said citing a person familiar with the matter The bank smarting from a prolonged sales scandal in its retail banking business is still leading to probes by regulators
Wells Fargo did not immediately comment on the matter |
WFC | Golf Leishman leads Wise by one at low scoring Byron Nelson | Reuters Australian Marc Leishman backed up his lowest round on tour with a five under par 66 on Friday to take a one stroke lead over fast closing American Aaron Wise at the AT T NYSE T Byron Nelson in Dallas Early starter Leishman rolled in six birdies including a 55 footer at the 12th against one bogey to finish two rounds at 15 under 127 at Trinity Forest Golf Club after his sparkling 61 on Thursday South African born Wise who started hours after Leishman came close to catching the Australian with an eight under 63 Six birdies and an eagle put the 21 year old at 14 under 128 a stroke ahead of American Brian Gay whose nine under 62 was the low round of the day Americans Jimmy Walker 67 Eric Axley 65 and Kevin Nau 65 shared fourth on 131 while former world number one Adam Scott of Australia 65 was in a group of five players one shot further back Leishman found the links style Trinity Forest the tournament s new home much to his liking I enjoy this type of golf the world number 16 told reporters It reminds me of back in Australia I like how the ball is running out on the fairways I m reading the greens well and I m hitting the ball well Leishman said there was a big difference in him shooting a four over 76 in the final round of last week s Players Championship and his play in Dallas My speed has been really great he told the Golf Channel Last week at The Players I hit a lot of really good putts that lipped out and this week they re going in Some weeks you read them really well and some weeks you re not sure if a 10 footer is slightly uphill or downhill and that affects your speed and line and everything Wise who tied for second in the Wells Fargo NYSE WFC Championship two weeks ago said he used the Australian as an incentive I saw Marc Leishman way up there at 15 under and I started the day at six under so I knew I had a long ways to go Wise told PGA Tour Radio It was nice when I started getting it going to see his numbers still ahead of me so I could keep chasing and chasing Even though I was playing tough I felt like I had to go get him a little bit which was fun Gay had as many birdies as Leishman on Thursday 10 but a bogey at the par four fourth spoiled his chances of equaling Leishman s round Six of his birdies came on the back nine My putting has been really down the last month or two and that s my strong suit so I have just been waiting for it to turn around Gay admitted
Hometown favorite Jordan Spieth found improvement with a solid 66 but was still eight strokes off the pace on a low scoring day |
WFC | Dollar scales 5 month peak as U S China trade tensions ease | By Gertrude Chavez Dreyfuss NEW YORK Reuters The dollar climbed to a five month peak on Monday as news of a truce between the United States and China on trade tariffs prompted investors to pare back their short positions on the greenback Investors have been short the dollar since July last year but since mid February the dollar index has rallied nearly 7 percent The dollar has been mainly bolstered by generally solid U S economic data that has backed the Federal Reserve s tightening stance this year The prospect of a resolution to the U S China trade tension has further added to the dollar s shine The two world s largest economies have agreed to drop their tariff threats for now U S Treasury Secretary Steven Mnuchin and President Donald Trump s top economic adviser Larry Kudlow said on Sunday the agreement reached by Chinese and American negotiators on Saturday set up a framework for addressing trade imbalances in the future While there have seemingly been few signs of concrete progress in those negotiations the more constructive tone from the two sides appears to be lending some support to the risk environment said Erik Nelson currency strategist at Wells Fargo NYSE WFC Securities in New York That news also boosted U S equities and Treasury yields underpinning the dollar as a result In mid morning trading the dollar index DXY rose 0 1 percent to 93 748 after earlier hitting a five month high above 94 This week the dollar s fate rests on the Federal Reserve with several Fed officials speaking this week and the minutes of the U S central bank s last monetary policy meeting due out on Wednesday If the minutes take note of inflation creeping higher it could open the door to faster rate hikes and a stronger dollar said Joe Manimbo senior market analyst at Western Union Business Solutions in Washington In other currency pairs the dollar rose to a four month high against the yen at 111 39 and was last at 111 13 up 0 4 percent The yen has been pressured by recent weaker Japanese data a U S China trade war truce and elevated U S Treasury yields analysts said The euro meanwhile was flat against the dollar at 1 1770 after earlier falling to its lowest since around mid November Europe s single currency has been affected by concerns about political uncertainty in Italy This week will bring about a further test for stubborn euro bulls with the release of May flash PMI data on Wednesday where markets will be waiting to see whether the first quarter slowdown in Europe has spilled over to the subsequent months Currency bid prices at 10 23AM 1423 GMT Description RIC Last U S Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro Dollar EUR 1 1754 1 1775 0 18 2 02 1 1781 1 1717 Dollar Yen JPY 111 2300 110 7400 0 44 1 28 111 3900 110 7400 Euro Yen EURJPY 130 74 130 36 0 29 3 28 130 9900 130 3800 Dollar Swiss CHF 0 9979 0 9975 0 04 2 41 1 0001 0 9968 Sterling Dollar GBP 1 3418 1 3471 0 39 0 70 1 3483 1 3391 Dollar Canadian CAD 1 2844 1 2880 0 28 2 12 1 2890 1 2830 Australian Doll AUD 0 7553 0 7511 0 56 3 18 0 7561 0 7504 ar Euro Swiss EURCHF 1 1730 1 1742 0 10 0 35 1 1759 1 1708 Euro Sterling EURGBP 0 8757 0 8740 0 19 1 42 0 8773 0 8723 NZ Dollar Dolar NZD 0 6920 0 6910 0 14 2 34 0 6933 0 6885 Dollar Norway NOK 8 0869 8 1124 0 31 1 46 8 1370 8 0672 Euro Norway EURNOK 9 5057 9 5548 0 51 3 48 9 5585 9 5000 Dollar Sweden SEK 8 7137 8 7525 0 58 6 24 8 7812 8 6926
Euro Sweden EURSEK 10 2427 10 3026 0 58 4 10 10 3084 10 2365 |
EBAY | Ebay sells Craigslist stake back to Craigslist | Reuters EBay Inc O EBAY said it has sold its 28 4 percent stake in Craigslist Inc back to the online classified advertising company Under a confidential settlement agreement all litigation between the companies will also be dismissed eBay said in a blog post The companies have been feuding for years in civil court over allegations that eBay took a stake in Craigslist and then misappropriated confidential information while secretly planning its own classifieds site
EBay which launched classified ad service Kijiji in the United States in 2007 bought the Craigslist stake in 2004 |
EBAY | eBay announces July spin off of PayPal | Investing com eBay Inc NASDAQ EBAY announced on Friday that its Board of Directors approved a highly anticipated spin off of PayPal Inc
Shareholders of eBay as of July 8 will receive one share of common stock in Pay Pal for each share of eBay stock owned through a pro rata distribution The distribution remains subject to conditions described in Form 10 regulatory filings including an approval from the European Central Bank eBay said in a statement
PayPal will be listed on the NASDAQ under the ticker PYPL while eBay will continue to be traded on the NASDAQ under the ticker EBAY
In mid May PayPal announced the composition of its board while filing a second amendment to Form 10 Current eBay CEO John Donahoe will serve as PayPal s Chairman of the Board following the separation Devin Wenig will serve as CEO designee at eBay while Dan Schulman will occupy a similar post with PayPal
eBay and PayPal are two great special businesses eBay CEO John Donahoe said in a statement As separate independent companies eBay led by Devin and PayPal led by Dan will each have a sharper focus and greater flexibility to pursue future success in their respective global commerce and payments markets I am confident that eBay and PayPal each have the right leadership team strategy structure and operational discipline to create sustainable long term value for stockholders and deliver great opportunities and experiences for customers worldwide
eBay increased revenues by 4 in the first quarter to 4 5 billion bolstered by a 14 spike in its PayPal subsidiary
Goldman Sachs Co and Allen Company LLC are serving as financial advisors for the divestiture |
EBAY | Thomas H Lee in the lead to buy eBay s enterprise unit sources | By Liana B Baker and Greg Roumeliotis Reuters Private equity firm Thomas H Lee Partners LP is in advanced talks to acquire the enterprise business of eBay Inc O EBAY for close to 1 billion according to people familiar with the matter Thomas H Lee has so far outbid other parties in the auction for the business though disagreements over price persist and there is no certainty that a deal will be reached the people said this week The sources asked not to be identified because the negotiations are confidential Representatives for Thomas H Lee and eBay declined to comment EBay s enterprise business formerly known as GSI Commerce helps retailers around the world beef up their online presence and e commerce capabilities EBay said in January that it would explore strategic alternatives for the unit which does not fit neatly with its PayPal and marketplace divisions It generated 288 million in revenue in the first quarter GSI Commerce was acquired by eBay for 2 4 billion in 2011 It has lost customers and seen sluggish growth in the past few years as its clients move their online operations in house PayPal Holdings Inc which has separated from eBay will start trading officially under the ticker PYPL on the Nasdaq later this month Toys R Us Inc a client of GSI Commerce since 2006 announced on Thursday it was launching its own online platform a move that could take away more business from the unit Based in Boston Thomas H Lee has raised approximately 21 billion of equity capital and invested in more than 130 portfolio companies with an aggregate value of over 150 billion since it was founded in 1974
Bloomberg News reported last month that Thomas H Lee was one of the remaining bidders for eBay s enterprise unit |
EBAY | eBay nearing deal to sell enterprise unit for about 900 million WSJ | Reuters E commerce company eBay Inc NASDAQ EBAY is nearing a deal to sell its enterprise business to a consortium led by private equity firm Permira for about 900 million the Wall Street Journal reported The deal could be announced as soon as Thursday along with the company s second quarter results the Journal reported citing people familiar with the matter The people said there was no guarantee a deal would be reached the newspaper reported Earlier this month people familiar with the matter told Reuters that private equity firm Thomas H Lee Partners LP was in talks to buy eBay s enterprise unit for close to 1 billion EBay said in January that it would explore a sale or public offering of the enterprise business which did not fit neatly with its PayPal or marketplace divisions EBay s enterprise business formerly known as GSI Commerce helps retailers around the world beef up their online presence and e commerce capabilities It generated 288 million in revenue in the first quarter GSI Commerce was acquired by eBay for 2 4 billion in 2011 It has lost customers and seen sluggish growth in the past few years with clients moving their online operations in house An eBay spokeswoman said the company does not comment on rumor or speculation
Permira could not be reached for comment outside regular business hours |
EBAY | Should Facebook FB Buy EBay EBAY | Shares of online marketplace eBay NASDAQ EBAY are down over 10 since the company reported its fiscal 2016 results after the closing bell Wednesday Investors are reacting negatively to eBay s sluggish holiday season guidance however some on the internet are pointing to the company s new partnership with Facebook NASDAQ FB as an encouraging sign for growth or a potential buyout
Lackluster Guidance
eBay posted third quarter earnings of 45 cents per shares which beat average analyst expectations by a penny The company saw revenue figures of 2 22 billion beating our consensus estimate of 2 182 billion and gaining 5 6 year over year
Despite two beats investors punished eBay for what was seen as relatively lackluster guidance For the fourth quarter eBay expects to see revenue of 2 36 billion to 2 41 billion and adjusted earnings of 52 to 54 cents per share Wall Street analysts were previously calling for revenue of 2 40 billion and earnings of 54 cents per share also read
Perhaps the worst part about eBay s weak fourth quarter guidance is that by all accounts this year is gearing up to have a solid holiday shopping season
Research from the predicts that holiday sales excluding autos gas and restaurant sales will increase 3 6 which is significantly higher than the 10 year average of 2 5 and above the seven year post recovery average of 3 4 also read
New Relationship with Facebook
While eBay s fourth quarter guidance is unsettling some investors are looking forward to the company s new partnership with Facebook The social media site has employed eBay to help it launch a shopping bot on its Messenger app
Once dubbed ShopBot the artificial intelligence technology is expected to drive sales to Facebook which has been looking for ways to employ bots without overloading users Facebook s Messenger application has over one billion users but the company currently does not have a way to monetize the transactions that take place on the platform
A struggling eBay s new found friendship has of course sparked rumors and commentary on the web with many suggesting that Facebook should go even further by buying out the online marketplace
We do know that Facebook is gaining interest in e commerce the site just recently launched Marketplace a sort of Craigslist eBay hybrid that allows users to buy and sell items from other users that are within the same geographical area also read
If Facebook is willing to try out its own online shopping platform is it too unrealistic to think that it might want to carve out a main competitor Personally I don t think it is crazy at all especially considering the fact that eBay is basically the original online re selling platform
Marketplace could keep its focus on local sales and eBay could continue to allow shipping to anywhere Listings could be cross posted on both sites and using Facebook s plethora of user data customers could be targeted with products that would interest them specifically
Bottom Line
At this point any conversation about Facebook buying out eBay is simply an unfounded internet rumor However just because a rumor is unfounded doesn t mean it s inherently a bad idea In my humble opinion if the price is right an eBay buyout could make sense for Facebook
You are invited to download the full up to the minute list of 220 Zacks Rank 1 Strong Buys free of charge Many of these companies are almost unheard of by the general public and just starting to get noticed by Wall Street They have been pinpointed by the Zacks system that nearly tripled the market from 1988 through 2015 with a stellar average gain of 26 per year |
EBAY | eBay Drops On Low Q4 Guidance | eBay NASDAQ EBAY recently announced stronger than expected third quarter earnings after the market close on Wednesday However the company provided fourth quarter guidance that was lower than the average analyst estimate sending shares plunging in after hours trading
The company posted revenue of 2 2 billion surpassing the consensus estimate of 2 18 billion The figures indicate a 1 percent increase year over year but a slowdown from 6 percent growth in the second quarter eBay disclosed earnings of 45 cents per share beating analysts forecast of 44 cents
Shares of eBay lost 7 69 percent to 30 02 in after hours trading following the company s announcement of a soft outlook for the current quarter After the market close eBay said it projects adjusted per share earnings between 52 cents and 54 cents on revenue between 2 36 billion and 2 41 billion for the fourth quarter
Attempts to generate more value from its data and utilize that to create revenue got the company a target hike ahead of third quarter earnings Market experts increased their price target on eBay stock to 36 from 34 considering the company s opportunity on its structured data initiative The initiative is developed to prompt faster user growth reduce the cost of traffic acquisition and improve the user experience making it easier for customers to find the best products on its site
According to eBay s President and CEO Devin N Wenig the company s plan was to maintain a low to mid single digit top line growth rate and keep margins and cash flow high
eBay Introduces New Portal
eBay recently launched a new portal named eBay Collective which will feature high end artwork furniture and interior designs in an attempt to curate a variety of products for its customers
The company s new platform will apply an AI powered tool to assist shoppers in searching for items which could help this initiative attain a good outcome by boosting conversion rates
The new site is centered on rare and high end items The company reviewed and partnered with particular dealers to participate in the program and it is offering a white glove managed shipping service that grants flat rate on longer distance shipments in the United States Despite a possible crossover with rivals eBay seems to be promoting inventory from popular designers that carry rare and high priced products
A Shop the Room feature is added to the new platform This suggests specific items for purchase that mirrors generic items in a picture
The success of the new eBay portal will depend on the performance of its artificial intelligence in driving conversions eBay Collective may grapple to drive actual sales as shoppers will likely be hesitant to purchase a vintage or rare item over the internet without seeing it in person On the other hand sales of larger items such as furniture are moving to the web |
EBAY | The Week Ahead Time For A Portfolio Transition | There is some important data on the schedule for this week along with earnings and the expected doses of FedSpeak None of that will attract much attention Instead expect all Trump all the time The slant in financial media will be the implications for investors As we get news of the leadership transition I expect the punditry to be asking
Do investment portfolios need a transition
Last Week
Last week s economic news was all good but less important than the election
Theme Recap
In my last WTWA I predicted a focus on the election and the chances for greater economic and financial clarity The election expectation was obvious and there was indeed a focus on the implications for investors That said I embraced the consensus expectations which proved to be dramatically incorrect I did correctly note that the crystal ball would remain cloudy but that proved to be quite an understatement
The Story in One Chart
I always start my personal review of the week by looking at this great chart of the S P 500 from Doug Short He captures the post election rally as well as the Friday fizzling
Doug has a special knack for pulling together all the relevant information His charts save more than a thousand words Read his entire post where he adds analysis grounded in data and several more charts providing long term perspective Here is one additional example
The big story of the trading week does not show up in the stock market data As the Trump victory became apparent overnight trading in stock futures showed a massive decline This chart shows the selling and the morning rebound
The News
Each week I break down events into good and bad Often there is an ugly and on rare occasion something very positive My working definition of good has two components The news must be market friendly and better than expectations I avoid using my personal preferences in evaluating news and you should too
This week s news was quite good If I missed something for the bad list please feel free to suggest it in the comments
The Good
Election uncertainty ended This was a known market friendly event although the amount of the reaction was a surprise
Framing lumber demand drives higher prices Those who prefer market data to other source should take note of the
Earnings reports continue strength on all measures Earnings growth results versus expectations sales versus expectations and outlook are all solid It is not getting much attention but the earnings recession is over provided the first alert on this dramatic shift and now points to a possible expansion in multiples Ed Yardeni shows the impact via changed expectations
Michigan sentiment showed strength with a reading of 91 6 solidly beating the prior month and expectations The survey was before the election
JOLTS remained positive This may be the most misunderstood indicator Pundits use it to analyze job growth because that is what they want to know about Many other measures do that job better JOLTS is about the structure of the labor market How tight things are and whether employees freely leave jobs for others If you do not understand the Beveridge Curve you do not understand JOLTS
Initial jobless claims declined to 254K marking 88 consecutive weeks below 300K This is the best record since 1970 Calculated Risk and a helpful chart
The Bad
OPEC output jumped This calls into question the planned production cuts Whether you agree with me that stock prices should not be linked to oil prices that continues to be the reality Thus this news is market unfriendly
The Ugly
Financial abuse of the elderly Reshma Kapadia of Barron s has a great on this topic describing the various scams and consequences Here are a few of the top ones
The Silver Bullet
I occasionally give the Silver Bullet award to someone who takes up an unpopular or thankless cause doing the real work to demonstrate the facts No award this week Nominations are welcome
Noteworthy
Could you pass the U S Citizenship Test You might enjoy the Example Who was not one of the writers of the Federalist papers John Jay James Madison Alexander Hamilton or Thomas Jefferson Mrs OldProf tells me that this one is too easy if you scored a ticket to and paid attention
The Week Ahead
We would all like to know the direction of the market in advance Good luck with that Second best is planning what to look for and how to react That is the purpose of considering possible themes for the week ahead You can make your own predictions in the comments
The Calendar
We have an important week for economic data with a special focus on housing
The A List
Housing starts and building permits Th Different directions in recent reports
Retail sales T Continuing strength expected
Initial claims Th The best concurrent indicator for employment trends
The B List
Philly Fed Th Continuing small gains expected in an early read on November
Industrial production W Small growth expected despite recent weakness
PPI W Still not a major market factor but moving higher
CPI Th Not the Fed s official inflation indicator but it is moving beyond the target
Business inventories T September data but relevant for final Q3 GDP
Crude inventories W Recently showing even more impact on oil prices Rightly or wrongly that spills over to stocks
There are still some earnings reports including housing stocks Once again we also have almost daily Fedspeak We ll get to watch some dancing around the political questions
Next Week s Theme
In a different year this would be a week for special attention to housing The economic data feature some important forward looking indicators and earnings reports include important housing related stocks Instead the surprised investment community is scrambling to identify the implications of a Trump presidency and a GOP Congress Regular media will have daily reports of transition plans cabinet appointments and shifting policy stances Financial media will focus on what it means for investors Expect this question to be a common theme
Does your portfolio need a complete remake
Here are the important issues
Has the best asset allocation shifted More stocks less bonds
Is the overall market more dangerous Time for more cash
What are the likely economic consequences in both the short and long terms The has a nice general summary loaded with charts about the economy Mr Trump will inherit
Which stock sectors are likely to benefit and by how much
Are there specific stock favorites
Traders rushed to act frequently on hastily and ill formed ideas The overnight futures trading is a spectacular example but most of the other conclusions are also quite speculative Consider how wrong many of the big names in investments have been Citi Goldman and Bridgewater Associates all expected declines of 3 10 on a Trump victory Even after the market was rallying many of the pros were expecting the story to end at any moment As the three errors included the event itself the impact and the aftermath
I in a message to my readers the morning after Clients got more detail Check out the post for my list of four key points
As one person noted in the comments using patience left you behind on some day trading possibilities True enough if you guessed well Would stocks down 6 continue to decline or stocks up 6 keep ascending
I ll have a few ideas of my own about what comes next in today s Final Thoughts
Quant Corner
We follow some regular great sources and the best insights from each week
Risk Analysis
Whether you are a trader or an investor you need to understand risk Think first about your risk Only then should you consider possible rewards I monitor many quantitative reports and highlight the best methods in this weekly update
The Indicator Snapshot
The increased yield on the ten year note has lowered the risk premium a bit I suspect much more to come
The Featured Sources
Bob Dieli The C Score which is a weekly estimate of his Enhanced Aggregate Spread the most accurate real time recession forecasting method over the last few decades His subscribers get including both an economic overview of the economy and employment
Holmes Our cautious and clever watchdog who sniffs out opportunity like a great detective but emphasizes guarding assets
Brian Gilmartin Analysis of for the overall market as well as coverage of many individual companies
Doug Short The Big Four Update the World Markets Weekend Update and much more
Georg Vrba The and much more for an array of interesting methods Georg Bob Dieli s enhanced aggregate spread considering when it might first give a recession signal Georg thinks it is still a year away It is interesting to watch this approach along with our weekly monitoring of the C Score
RecessionAlert Many for both economic and market analysis While we feature his recession analysis Dwaine also has several interesting approaches to asset allocation Try out his new public
How to Use WTWA important for new readers
In this series I share my preparation for the coming week I write each post as if I were speaking directly to one of my clients Most readers can just listen in If you are unhappy with your current investment approach we will be happy to talk with you I start with a specific assessment of your personal situation There is no rush Each client is different so I have six different programs ranging from very conservative bond ladders to very aggressive trading programs A key question
Are you preserving wealth or like most of us do you need to create more wealth
My objective is to help all readers so I provide several free resources Just write to info at newarc dot com We will send whatever you request We never share your email address with others and send only what you seek Like you we hate spam Free reports include the following
Understanding Risk what we all should know
Income investing better yield than the standard dividend portfolio and less risk
Holmes and friends the top artificial intelligence techniques in action
Why it is a great time to own for Value Stocks finding cheap stocks based on long term earnings
You can also check out my website for and a discussion of the I welcome questions on this subject What scares you
Thanks also to readers for the interest and early comments for my latest paper The Top Twelve Investor Pitfalls and How to Avoid Them Readers of WTWA can get a copy by sending an email to info at newarc dot com We will not share your address with anyone
Best Advice for the Week Ahead
The right move often depends on your time horizon Are you a trader or an investor
Insight for Traders
We consider both our models and the top sources we follow
Felix and Holmes
We continue with a strongly bullish market forecast Felix is fully invested Oscar holds several aggressive sectors The more cautious Holmes also remains fully invested Now joined by Athena the group has a regular Thursday night discussion which they call the This week s question was the effectiveness of technical analysis in the aftermath of a disruptive event You can see that discussion as well as the most recent ideas for consideration and you can ask questions
Top Trading Advice
against overtrading simply because things are boring Not so much this week but that might make it the best time to consider a great lesson
He also presents an an interesting comparison to our approaches
Bill Luby shows that the volatility crush was among the top 25 in history If you have been trading VIX as a long plenty of agility was necessary to limit your losses If it was a hedge you needed significant positions in the right sectors to make a profit Check out for the full story
Insight for Investors
Investors have a longer time horizon The best moves frequently involve taking advantage of trading volatility
Best of the Week
If I had to pick a single most important source for investors to read this week it would be the cool headed and accurate analysis from Liz Ann Sonders This coverage of Schwab s IMPACT 2016 the largest conference in the investor business Robert Huebscher continually brings the best analysis to advisors through special posts I always read them along with many other advisors but they are not a secret You too can see what the advisor community is following Here is a key quote on valuation
Valuation metrics can support any view of the market she said The metrics that are dependent on an inflation or interest rate component show that the market is cheap she said But metrics such as the forward P E ratio show a median valuation Sonders said that valuations tend to be highest when inflation is 2 3 just above its current range But inflation going higher is a risk for P E ratios she explained
A slavish devotion to valuation indicators that ignore low interest rates has been an expensive mistake for investors Here is a chart of the ETF modeled on Prof Shiller s famous CAPE ratio Despite the professor s repeated statements that he is personally invested and recommends a significant stock allocation his work is most frequently cited as indicating potential for a market crash That is not his personal interpretation The Barclay s ETF uses CAPE to find the most attractive sectors and it remains fully invested
Suppose that each of the CAPE devotees who went to cash because of alarming valuations had allocated just 25 of the portfolio to the CAPE fund Not that this has been the very best choice but it illustrates the Shiller contrast very well
Stock Ideas
Companies that may participate in rebuilding the aging infrastructure Here are eleven stocks that could benefit from the 2 75 trillion that The American Society of Civil Engineers sees as necessary Some of the ideas might surprise you
Barron s has a for those interested in immediate pursuit of the Trump theme
Our trading model Holmes has joined our other models in a weekly market discussion Each one has a different personality and I get to be the human doing fundamental analysis We have an enjoyable discussion every week with four or five specific ideas that we are also buying Holmes likes Tractor Supply NASDAQ TSCO Check out the post for my own reaction and more information about the trading models
While we cannot verify the suitability of specific stocks for everyone who is a reader the ideas have worked well so far My hope is that it will be a good starting point for your own research Holmes may exit a position at any time If you want more information about the exits just sign up via holmes at newarc dot com You will get an email update whenever we sell an announced position
plays the semi contrarian with his eBay NASDAQ EBAY idea
has a very important post combining an analysis of the risk from increased market volatility with the analysis of specific stocks Investors should be reading Chuck s work carefully every week
Personal Finance
Professional investors and traders have been making Abnormal Returns a daily stop for over ten years If you are a serious investor managing your own account you should join us in adding this to your daily reading Every investor should make time for a weekly trip on Wednesday Tadas always has first rate links for investors in his There are always several great choices worth reading My personal favorite this week is the advice on how to handle market volatility from Christine Benz She easily clears the first hurdle the temptation to give blanket advice Each investor is different She offers time frame as one important consideration If investors want to copy what I do with clients this article provides a good basic outline
As you gauge whether to make any changes in light of the volatility the really important concept to keep on your radar is risk capacity what sort of losses can you endure without having to rework a goal
If you still have a reasonably long time until retirement say 10 years or more you have a fairly high risk capacity That means that regardless of how you feel about near term losses you re likely to recover from them during your time horizon In fact stocks have generated positive returns in more than 90 of rolling 10 year periods For that reason such investors ought to have aggressively positioned portfolios with at least 50 in stocks given today s low bond and cash yields a more conservatively positioned portfolio will barely preserve purchasing power let alone grow
Seeking Alpha Editor Gil Weinreich was one of the few to highlight the possibility of a Trump victory and do so with confidence He reasoned from the Brexit precedent and a sense of the popular uprising In a helpful and constructive fashion he disagreed with my highlighted sources in last week s WTWA While his work is popular among investment advisors writing on Seeking Alpha the topics are frequently important for active individual investors
Out of the several helpful posts last week my favorite was the and appreciated the mention to follow your plan rather than the election This is especially persuasive from someone who called the election result The money line from Gil
But as we all know investing is best accomplished unemotionally
Other ideas
For the most conservative investors who normally stick to Treasuries it may be time to switch to TIPS that inflation fears have now given the edge to the inflation protected securities
Emergency fund idea bad advice explains why paying off credit cards is more important Do the math
Blue Harbinger provides on Business Development Companies BDCs The article ranks many of the opportunities and provides criteria for evaluation This is a good start for anyone considering investments in this space
Watch out for
Dividend stocks Many observers opined that this week s decline in the bond substitutes was only the start I agree The have a different take While they are looking for buying opportunities here are the early returns
Final Thoughts
Last week I embraced the conclusions from the polling community which was dramatically incorrect They are preparing post mortems They will try to figure out the sources of error and improve their methods because that is what professionals do Of the sources I cited last week Nate Silver was the best Even his methods gave Mr Trump only about a 30 chance That is not high enough to predict the outcome but it should get one s attention I will be doing my own review of what went wrong with the pollsters and whether we gave them too much credit
I was more accurate concerning what investors should be doing about the election I have expected a market rally after the election if only because a big element of uncertainty would be removed I also have warned that plenty of uncertainty will remain
If you allowed your political preferences to influence your investing you probably have had poor results If you have been sticking to the fundamentals a solid portfolio of cheap stocks you are doing well
What s Next
As I write this we have already seen a change in the Trump transition leadership and acceptance of some elements of ObamaCare Each policy needs fresh scrutiny using the following elements
The possible difference between candidate Trump and President Trump
Which proposals were serious
The effect of actual responsibility
The influence of the team
The limitations of power See this on what Truman said about Eisenhower
The potential for compromises
I will look at these questions on a policy by policy basis discovering the changes in value in the related stocks Many journalists and pundits are on this job of course but the instant conclusions are unreliable Even the best journalists and financial analysts have little experience in analyzing the workings of the policymaking process
For most investors a portfolio review is in order and a remake might be As the leadership transitions so should your asset allocation and stock selection It is a job that should be done carefully and done right You have a lot at stake |
EBAY | EBay Stock Hasn t Recovered Since Earnings Will This Slump Continue | It has been about a month since the last earnings report for eBay EBAY Shares have lost nearly a double digit percentage value in the past month easily underperforming major benchmarks in that time frame
Will the recent negative trend continue leading up to their next earnings release or is the stock due for a breakout Before we dive into how investors and analysts have reacted as of late let s take a quick look at the most recent earnings report in order to get a better handle on the important drivers
Recent Earnings
eBay s Q2 Earnings and Revenues Beat Estimates eBay Inc NASDAQ EBAY reported second quarter 2016 earnings of 36 cents per share matching the Zacks Consensus Estimate of 36 cents Adjusted earnings per share exclude one time items but include stock based compensation expense Management sounded upbeat and mentioned several initiatives including the collection of data from sellers application of artificial intelligence for a better user experience increased use of social media to drive traffic and focus on discovery based user experience to name a few eBay seeks to attract more customers to its online properties engage them and thus generate revenues Therefore the best way to understand the business is through its revenue volume growth customer growth revenue per customer and cash flow RevenuesGross revenue of 2 23 billion was up 5 7 on a year over year basis up 7 on an Fx neutral basis In the second quarter the Marketplace platforms contributed 19 8 billion of GMV and 1 8 billion of revenue On the other hand StubHub also showed signs of accelerated growth with contribution of 1 1 billion of GMV up 35 on a year over year basis and revenue of 0 2 billion up 40 on a year over year basis Gross Merchandise Volume GMV grew 6 year over year on an Fx neutral basis Active buyers customers totaled 164 million flat sequentially but up 6 from the year ago quarter By geography the U S generated 8 5 billion of GMV up 5 accelerating two points versus Q1 The acceleration was driven equally by Marketplace and StubHub International delivered 12 3 billion of GMV up 6 year over year MarginsPro forma gross margin for the quarter was 78 1 down 164 basis points bps year over year but up 21 bps sequentially Cost of revenue increased 160 basis points on a year over year basis that was driven primarily by the addition of PayPal processing costs and the impact of foreign exchange Adjusted operating expenses of 1 21 billion increased 7 4 from the prior year quarter and 16 7 sequentially Operating margin shrank 249 bps year over year and 552 bps sequentially to 23 7 Excluding the impact of intangibles amortization and other items on a tax adjusted basis pro forma net income came in at 411 million compared with 396 million in the year ago period Including the special items GAAP net income was 437 million 38 cents per share compared with 430 million 35 cents per share in the year ago quarter OutlookFor the third quarter of 2016 eBay expects revenues to grow 6 7 on an Fx neutral basis to 2 16 billion 2 19 billion Non GAAP earnings are expected within 42 cents 44 cents GAAP earnings per share from continuing operations are expected in the range of 35 cents 37 cents In 2016 eBay expects revenues to grow 5 on an Fx neutral basis to 8 85 billion 8 95 billion
How have estimates been moving since then
Following the release and in the last month investors have witnessed an upward trend for fresh estimates There have been three revisions higher for the current quarter compared to zero lower in the past thirty days However this has done little to move the consensus estimate as we can see in the chart below EBAY INC Price and Consensus VGM Scores
At this time eBay s stock has a subpar Growth score of D a grade with the same score on the momentum front However the stock was allocated a grade of B on the value side putting it in the second quintile for this investment strategy This solid grade on the value front does little for EBAY s overall picture though as the company currently retains a D Grade for its VGM score making it a poor overall choice from a fundamental look
Outlook
While estimates have been trending upward for the stock the magnitude of these revisions has been almost zero Interestingly shares of EBAY have a Zacks Rank 3 hold so we are looking for an in line return from EBAY in the next few months and no real upside for investors right now
Want the latest recommendations from Zacks Investment Research Today you can download 7 Best Stocks for the Next 30 days |
WFC | No longer a favorite Woods happy to be in Players field | By Andrew Both PONTE VEDRA BEACH Fla Reuters Tiger Woods is not among the favorites for this week s Players Championship no longer the man to beat at the age of 42 even if he remains the one most fans wants to watch Woods is around a 33 1 betting outsider at the TPC Sawgrass a course where he twice has won the PGA Tour s flagship event in 2001 and again in 2013 Though he contended twice on the PGA Tour in Florida less than two months ago subsequent mediocre performances at the U S Masters and last week at the Wells Fargo NYSE WFC Championship have diminished his stock But that hardly worries Woods who apparently pain free after a spinal fusion last April bounded into the media interview room on Tuesday looking relaxed as he flashed his broad smile to a crowded room Trust me I m fully aware of how special this is for me he said recalling that 12 months ago he could barely walk without severe pain let alone swing a golf club I wouldn t say it s gravy but I m just so thankful to be able to have this opportunity again because I didn t know if I would ever have had it Woods is not quite ready to take on the role of a ceremonial player but will need to improve every facet of his game to have a chance against perhaps the strongest field of the year WIDE OPEN Australian Jason Day coming off a win in Charlotte on Sunday is the marginal favorite in a wide open field ahead of the other usual suspects such as Jordan Spieth Rory McIlroy Justin Thomas and Dustin Johnson As rank outsider Kim Si woo showed by winning here last year however that it is an unpredictable event Winners over the years have ranged from favorites such as Woods Phil Mickelson Greg Norman and David Duval to the likes of outsiders such as South Korean Kim New Zealander Craig Perks South African Tim Clark and Canadian Stephen Ames Look at the winners here and it s all over the place said world number two Thomas who tied for third two years ago It really is a total package golf course You have to be in total control of your ball working it one way off the tee working it another way into the green having your distances down to where you re putting from the right spots Newly crowned Masters champion Patrick Reed predicted low scores I played the back nine today and it s absolutely perfect he said The course is set up for where if you hit a quality shot it s going to reward you and if you don t you re going to be penalized
I m hitting the ball well enough especially off the tee that there s no reason not to be aggressive |
WFC | Qatar s Commercial Bank hires banks for first public bond since Gulf dispute | DUBAI Reuters Commercial Bank QA COMB Qatar s third largest lender by assets has mandated banks to arrange a series of fixed income investor meetings ahead of a potential U S dollar denominated bond
The planned transaction would be the first public bond issue by a Qatari bank since a political dispute erupted in June last year between Qatar Saudi Arabia the United Arab Emirates Bahrain and Egypt
Qatari banks have sought to diversify their funding since the boycott started
Commercial Bank said last month it had borrowed 250 million through a loan syndicated in the Asian market and earlier this year it sold bonds in the Swiss franc market
Its larger peer Qatar National Bank also resorted to various niche markets issuing private placements Australian dollar denominated bonds and Formosa bonds in Taiwan
But the Qatari government issued last month its first public bonds since the Gulf rift started raising 12 billion and opening the way for other Qatari entities to issue public international bonds
The deal which was largely oversubscribed set a benchmark that investors can now use to price Qatari debt issues amid the ongoing regional diplomatic crisis
Qatar s Commercial Bank has hired BofA Merrill Lynch Al Khaliji Barclays LON BARC QNB Capital Standard Chartered LON STAN Bank and Wells Fargo NYSE WFC as joint lead managers for the planned debt sale it said on Wednesday
The five year senior unsecured bond will be of benchmark size which normally means upwards of 500 million the bank said in a statement on Wednesday
Commercial Bank representatives will meet investors in Asia and Europe starting from May 10 |
WFC | Golf Back injury forces world number 12 Casey out of Players | PONTE VEDRA BEACH Fla Reuters Englishman Paul Casey has withdrawn from the Players Championship due to a back injury the PGA Tour announced on Wednesday American Kevin Mitchell is Casey s replacement in the 144 man field at TPC Sawgrass where the tournament gets underway on Thursday World number 12 Casey has been in excellent form this year The 40 year old won the Valspar Championship in Florida in March holding off Tiger Woods and Masters champion Patrick Reed by one stroke Casey also threatened the course record of 63 in the final round at the U S Masters in April before finishing with two straight bogeys for a 65
He tied for fifth last Sunday at the Wells Fargo NYSE WFC Championship in Charlotte |
WFC | McIlroy seeks to solve Sawgrass puzzle as Day eyes another win | By Andrew Both PONTE VEDRA BEACH Fla Reuters Former world number ones Rory McIlroy and Jason Day have different comfort levels entering the Players Championship one knowing what it takes to win at TPC Sawgrass and the other still seeking to solve the puzzle of the famous course While Day blew away the field for a dominating four stroke victory two years ago McIlroy has not finished better than sixth in the event But the Northern Irishman says he has slowly learned the keys to success after missing the cut on his first three visits and has at least given himself a chance of contending in his past few starts I sort of learned to play the course a little bit better and reined myself in on some tee shots and that s what s brought me a little bit of success here McIlroy said on Wednesday Once I started to be a little more conservative I started to sort of top 10 it and give myself half a chance This is my ninth time here so I m not a spring chicken anymore I think it is about time to step up and give myself a chance of victory McIlroy has not had a bad season highlighted by a victory at the Arnold Palmer Invitational in March but this week will be his first high pressure test since last month s U S Masters disappointment Playing the final round with eventual winner Patrick Reed McIlroy was never a factor after missing a four foot eagle putt at the second hole I took a lot of positives from the fact I probably didn t have my best stuff at Augusta and I still was able to play my way into the final group and contend he said So yeah it gives you motivation There s a lot of golf to play We re not even halfway through the season We have got the other three major championships McIlroy a Manchester United fan also offered his best wishes to Alex Ferguson as the club s former manager seeks to recover from a brain hemorrhage I ve gotten to know Sir Alex pretty well over the years he said He s a very driven individual He says complacency is a disease Complacency will not be a problem for Day who has a burning desire to regain his world number one ranking Day has been focused on mechanics since winning the Wells Fargo NYSE WFC Championship on Sunday despite struggling with his swing He says his swing got knocked around in the wind last week and that he started hitting big hooks so he has been working hard with coach Col Swatton I don t usually bring Col into tournament only because I typically like to work with him before events Day said But I ve had a three week stretch here and I feel the swing s getting a little bit loose so we just tried to even out the path a little bit It s still not quite there I just need to hit the back of the ball with a square clubface Pretty easy right |
WFC | Wells Fargo trims expected hit from regulatory cap on assets | By Ross Kerber BOSTON Reuters Wells Fargo NYSE WFC Co on Thursday said a cap on the bank s growth imposed by regulators after sales practices scandals would hurt earnings less than it thought this year and forecast 2019 expenses below Wall Street expectations Analysts were upbeat about the expense outlook financial targets and lessened fallout from the regulatory restrictions though Wells Fargo said that reflected slower loan and deposit growth But some had hoped for more revenue details at the bank s annual investor day While we expect the market to view this financial outlook favorably portfolio managers keep on telling us they need to see the negative headlines abate and revenue growth to return Barclays LON BARC analyst Jason Goldberg wrote in a note Wells Fargo is under Federal Reserve orders to keep its assets below 1 95 trillion until governance and controls improve Chief Executive Tim Sloan said the bank now the fourth largest U S lender by assets is making plans to operate under that limit for the first part of 2019 He acknowledged the bank previously had not executed so well on compliance and risk oversight but pushed back on the idea that it has a lot more work to do and said some news headlines were getting tiresome I think we re through most of the historical review Sloan said during a question and answer period at the daylong meeting in Charlotte North Carolina which was webcast The bank previously expected the asset cap to hit after tax net income by up to 400 million but lower deposit and loan growth gave it room under the limit and caused it to cut that figure to less than 100 million Treasurer Neal Blinde said Well Fargo said net interest income or the difference in what it pays for deposits and what it earns on loans will be relatively flat in 2018 as lower earning assets and higher deposit costs offset higher interest rates The bank s shares closed at 54 65 on Thursday up 1 7 percent Wells Fargo Chief Financial Officer John Shrewsberry said the bank would not provide updated guidance on its efficiency ratio Investors and analysts have watched for improvements in that key measure of costs per dollar of revenue since the sales scandal erupted in 2016 Shrewsberry said under one scenario for 2020 it is possible the bank would have expenses of 50 billion to 51 billion and revenue consistent with 2017 results but cautioned that was not a formal projection Under questioning from analysts he declined to offer more specific revenue forecasts citing the many variables at play Noninterest expenses for 2019 would total 52 billion to 53 billion excluding litigation and remediation items the bank said compared to analyst expectations of 53 2 billion according to Thomson Reuters I B E S Barclays analyst Goldberg noted that two profitability targets Wells Fargo gave on Thursday roughly met his expectations a two year return on equity of 12 percent to 15 percent and two year return on average tangible common equity of 14 percent to 17 percent Perry Pelos who leads Wells Fargo s wholesale business said it remains the primary bank of about 11 percent of U S middle market companies While the bank s issues have prompted client questions Pelos said by and large they have hung with us |
WFC | Fed to put Wells Fargo remediation plan to public board vote letter | By Michelle Price WASHINGTON Reuters The Federal Reserve board will hold a public vote on whether to lift growth restrictions on scandal hit Wells Fargo NYSE WFC following pressure from Democratic Senator Elizabeth Warren the Massachusetts lawmaker said on Friday The Fed s policy shift could make it tougher for Wells Fargo to shake off the unprecedented sanctions that the bank said on Thursday are expected to crimp earnings by around 100 million In February the Fed ordered Wells Fargo to keep its assets below 1 95 trillion until it had improved its governance and risk controls following a wave of sales practices scandals The regulator previously said Fed staff would assess the adequacy of the bank s remediation plan which would also be reviewed by an independent third party During a congressional hearing in March and in a follow up letter however Senator Warren pressed Fed Chair Jerome Powell to submit the bank s remediation plan to a board vote and to consider publishing the third party review On May 10th Powell wrote to Warren that he accepted the request for a board vote After further consideration the decision about terminating the asset growth restriction will be made by a vote of the Board of Governors Powell wrote in the letter published by Warren s office on Friday He added that when the third party review is ready we will review that report to determine whether and to what extent the report can be publicly disclosed The Fed declined to comment on Friday beyond Powell s letter A spokeswoman for Wells Fargo declined to comment on the Fed s decision On Thursday Wells Fargo told investors the cap would hurt earnings less than it thought this year The bank previously expected the asset cap to hit after tax net income by up to 400 million but lower deposit and loan growth gave it room under the limit and caused it to cut that figure to less than 100 million Treasurer Neal Blinde said The bank said in financial filings that it had received detailed feedback from the Fed regarding its remediation plan In order to have enough time to incorporate this feedback Chief Executive Tim Sloan said the bank was planning to operate under the cap for the first part of 2019
I m glad the Fed s Board of Governors changed course Warren said in a statement The Fed must strictly enforce its order to show Wells Fargo that it means business |
WFC | Wells Fargo WFC Q4 Earnings Rises Records Tax Benefit | Have you been eager to see how Wells Fargo Company NYSE WFC performed in Q4 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 Earnings Improve Y YWells Fargo came out with adjusted earnings per share of 97 cents up from the prior year quarter earnings of 96 cents Results excluded estimated tax benefit from the reduction to net deferred income taxes and other adjustments The Zacks Consensus Estimate was 1 04 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 an impressive earnings surprise history The company delivered positive surprises in three of the prior four quarters Overall the company surpassed the Zacks Consensus Estimate by an average of 2 75 in the trailing four quarters Wells Fargo Company Price and EPS Surprise Revenue Came In Lower Than Expected Wells Fargo posted revenues of 22 1 billion lagging the Zacks Consensus Estimate of 22 4 billion Yet results improved from 21 6 billion in the year ago quarter Key Stats to Note Pre tax pre provision profit PTPP 5 3 billionROA net income to average assets 1 26 ROE net income applicable to common stock to shareholders equity 12 7 Results included 3 35 billion after tax benefit or 67 cents per share from the Tax Cuts Jobs Act and other itemsWhat 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 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 down 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 not 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 Zacks Editor in Chief Goes All In on This StockFull disclosure Kevin Matras now has more of his own money in one particular stock than in any other He believes in its short term profit potential and also in its prospects to more than double by 2019 Today he reveals and explains his surprising move in a new Special Report |
EBAY | Hillary Clinton woos technorati draws comparison to Eleanor Roosevelt | By Sarah McBride SAN FRANCISCO Reuters Hillary Clinton makes the final stop on Friday on a California fundraising tour where she has courted technology titans for her 2016 campaign and where one of her admirers tried comparing her to fellow former first lady Eleanor Roosevelt Clinton the frontrunner for the Democratic presidential nomination is gladhanding her way through the Bay Area s establishment and the newer technology class that could serve as an important source of money votes and credibility among the broader electorate On Friday she will attend a fundraiser at the Silicon Valley home of eBay O EBAY chief executive John Donahoe and his wife Eileen director of global affairs for the advocacy group Human Rights Watch The event is expected to attract many of the area s power players Silicon Valley provides a literal and metaphorical wealth of support for candidates It s a community of people focused on the future said Dan Newman a strategist at SCN Partners a campaign consultancy And of course to paraphrase bank robber Willie Sutton it s where the donors live The event on Friday follows San Francisco fundraisers hosted by hedge fund manager and environmentalist Tom Steyer and entrepreneur Susie Buell At Steyer s Wednesday gathering at his home Clinton was asked by a guest whether she was the Eleanor Roosevelt of her day or if Roosevelt was the Clinton of her day according to an attendee who didn t want to be named because the event was private Clinton drew laughs with a self deprecating response that downplayed the comparison to the storied national icon and feminist activist the attendee said Later in the day she visited the city s Century Club for an event hosted by Buell co founder of the clothing chain Esprit There she spoke for about 30 minutes on topics ranging from student debt to healthcare to immigration according to a guest who also declined to be identified Clinton who called earlier this week for a pathway to citizenship for undocumented immigrants is expected to return to the immigration issue on Friday before a crowd that will likely include a high percentage of technology players
Immigration represents the top political issue for many Silicon Valley executives who would like to hire more foreign engineers data scientists and other highly educated workers due to what they say is a shortage of U S workers in those fields |
EBAY | Lunch with Warren Buffett auctioned for 2 35 million | By Jonathan Stempel Reuters The chairman of a Chinese company that develops online games has agreed to pay 2 345 678 for a private lunch with billionaire investor Warren Buffett winning a charity auction This year s auction was the 16th to benefit the Glide Foundation a nonprofit in San Francisco s Tenderloin district that provides food health care rehabilitation and other services to the poor and homeless Glide said Zhu Ye chairman of Beijing based Dalian Zeus Entertainment Co SZ 002354 submitted the highest of 76 bids to win the five day auction on eBay O EBAY which concluded on Friday night His bid was well below the 3 456 789 winning bid in 2012 still a record for an eBay charity auction but will help Glide meet its 16 million annual budget The 16 auctions have raised about 20 2 million What we try to do is work to empower our people to make sure that people find some way to have hope the Rev Cecil Williams a Glide co founder said after the auction ended We were overjoyed when the count came in The winner can invite up to seven friends to eat with Buffett at the Smith Wollensky steakhouse in Manhattan Buffett 84 will talk about almost anything including philanthropy and life but not what he is buying and selling Some past winners chose to eat with Buffett at a steakhouse in Omaha Nebraska where he has run Berkshire Hathaway Inc N BRKa for 50 years The auctions began in 2000 after Buffett s first wife Susan introduced him to Glide She died in 2004 None of the first three winners paid more than 25 000 but the price soared once the auctions which had been live only moved online in 2003 One past winner Ted Weschler ended up working for Buffett as a Berkshire portfolio manager after paying 5 25 million to win the 2010 and 2011 auctions Just eight people submitted bids this year probably because the high bid reached seven figures on the first day Smith Wollensky founder Alan Stillman also donates to Glide Buffett is worth 69 2 billion ranking fourth worldwide according to Forbes magazine He is donating nearly all his wealth to charity The following are the winning bids in the Glide auctions 2000 Anonymous 25 000 2001 Anonymous 18 000 2002 Anonymous 25 000 2003 David Einhorn Greenlight Capital 250 100 2004 Jason Choo Singapore 202 100 2005 Anonymous 351 100 2006 Yongping Duan California 620 100 2007 Mohnish Pabrai Guy Spier Harina Kapoor 650 100 2008 Zhao Danyang China 2 110 100 2009 Salida Capital Canada 1 680 300 2010 Ted Weschler 2 626 311 2011 Ted Weschler 2 626 411 2012 Anonymous 3 456 789 2013 Anonymous 1 000 100 2014 Andy Chua Singapore 2 166 766
2015 Zhu Ye Dalian Zeus Entertainment Co China 2 345 678 |
EBAY | New York AG questions eBay PayPal on revised user agreements | Reuters New York law enforcement officials have written to eBay Inc O EBAY and PayPal Inc this week saying the companies revised user policies raise issues under consumer protection laws The updated user agreements would allow the e commerce company and the payments division it is spinning off to contact users by phone for offers and promotions to collect a debt or to poll their opinions through surveys and questionnaires Ebay s updated user agreement is scheduled to take effect on Monday and PayPal s will become effective on July 1 Consumer choice and privacy preferences are protected by state and federal laws including laws that specifically aim to stop companies from using invasive robocalls to promote products to consumers who do not wish to receive them Melissa Grace a spokeswoman for New York Attorney General Eric Schneiderman said The letters written by Kathleen McGee chief of the attorney general s Internet Bureau said the only way for users to opt out of the possibility of marketing calls or text messages was to stop using the auction site or payment processor entirely A representative of PayPal told Reuters the company had received the letter of inquiry and would respond to it adding that PayPal customers could choose not to receive autodialed or prerecorded message calls
EBay did not immediately respond to requests for comments outside regular U S business hours |
EBAY | Facebook Takes On E Commerce With Marketplace | On Monday social media giant Facebook Inc NASDAQ FB has launched what it calls Marketplace a way for users to buy sell and discover items in their local community
Marketplace will be rolled out to Facebook users 18 and older in the U S the U K Australia and New Zealand in the coming days To access it users will need to open the Facebook app and tap the shop icon at the bottom it opens up with pictures of items that people near your location have listed for sale You can also search to find something specific and results can be filtered by price location and category
If you re a seller the process is quite simple take a photo of the item you are trying to sell enter a product name price and description confirm your location select a category and post
If you re a customer and end up finding something you would like to buy the purchase process is also easy you simply have to send the seller a direct message from Marketplace and make an offer From there any further details are worked out between you and the seller Facebook s director of product management Mary Ku said in a the company will not facilitate the payment or delivery of items in Marketplace
As pointed out Facebook has been trying to enter the commerce market for a while now and Marketplace is a sort of evolution of its past efforts including users ability to use Messenger to send payments Because of its huge user base it recently reached over 1 5 billion users Facebook s Marketplace has the opportunity to surpass e commerce stalwarts like eBay Inc NASDAQ EBAY and Craigslist
There s also an element of trust with Marketplace that is absent from a platform like Craigslist as your Facebook profile can be viewed by potential buyers It will be much more difficult for scammers to be successful on Marketplace than on Craigslist It s also a convenient way to shop Instead of exiting the Facebook app and opening another shopping app users can browse through a wide range of products after they scroll through their News Feed
Image via Facebook
We found that the vast majority of people just like to browse They don t have a specific item in mind They are just scrolling through the feed and seeing if there s anything that might interest them said Marketplace product manager Bowen Pan to TechCrunch
It mimics some of the offline shopping behavior of going to a Sunday market or to the mall You might not know the items you want but you re open to seeing them Pan continued And this is true With Marketplace Facebook has the opportunity to capitalize on shoppers browsing habits online as well as in brick and mortar stores
If Marketplace proves successful in the four initial countries Facebook expects to continue to expand the service to additional countries via its iOS and Android apps over the next few months |
EBAY | After Facebook Marketplace What s EBay s Next Move | Though companies like eBay Inc NASDAQ EBAY and Etsy NASDAQ ETSY are well established players in the e commerce space and also have a first mover advantage it appears that Facebook Inc NASDAQ FB is slowly trying to explore the space Very recently it unveiled Facebook Marketplace that allows users to buy and sell items within their local communities This facility is already available through its Groups feature but the company is gradually enhancing its functionality to enhance the transaction experience Undoubtedly e commerce with a large user base worldwide has turned out to be a sweet spot and the additional advantage that Facebook has is its huge user base The company stated that over 450 million people buy and sell groups on its site each month Facebook s accelerating push in to the peer to peer e commerce market is a posing a threat to eBay but we believe that the impact will not be significant given eBay s scale brand awareness and advanced e commerce capacities at least in the short term eBay s Unique Capabilities eBay has introduced several measures to fuel growth in its Marketplaces business It now offers a local feature that allows a customer to buy something online and then pick it up at a local store at their convenience Aside from increased customer satisfaction owing to the added choice it lowers shipping costs The other initiative involves a discovery feature wherein eBay sellers can create a collection of items for customers to discover Additionally eBay continues to increase user engagement and satisfaction by driving traffic to its top rated sellers As a result same store sales at these retailers continue to grow at a healthy rate The company expanded the use of social channels which is significantly increasing traffic growth eBay s Classifieds portfolio provides a very important way to capture the local customer to customer opportunity which often represents customers who are selling items more suited to a local transaction Revamping Seller Policies eBay continues to revamp seller policies to help small and medium sized sellers and better reward those who provide quality service to buyers The company is also allowing sellers to tailor the way they manage returns based on their specific business needs with as much involvement from eBay as they desire It has launched a Seller hub which puts sellers listing and marketing tools along with deep data insights and selling recommendations at one central place The platform allows professional sellers to manage end to end business on eBay It also focuses on areas designed to drive more engagement from consumer sellers For instance the company is expanding its intermediated selling service eBay Valet In comparison Facebook s Marketplace is still at a beta stage and a lot remains to be done before it can contend with market leaders Considering eBay s strong position and unique capabilities in the space and Facebook s previous failures with similar attempts we don t find any reason for eBay to worry at least in the near term EBAY INC Price Focus on Technological ImprovementIn its efforts to deliver a more robust commerce platform eBay is building a solid foundation of structured data through a three pronged approach The company has started gathering product data from sellers inventory list eBay uses machine learning to process that data to improve user experience Getting a product identifier is very helpful after the company associates that product information to similar products The company is planning to acquire SalesPredict in order to strengthen its effort toward artificial intelligence machine learning and structured data The company has also announced the acquisition of Ticketbis to expand StubHub beyond North America to Europe Asia Pacific and Latin America Zacks Rank and Stocks to Consider Currently eBay is a Zacks Rank 2 Buy stock Another stock worth considering in the broader technology sector include LinkedIn Corporation NYSE LNKD sporting a Zacks Rank 1 Strong Buy You can see Linkedin has seen estimates for the full year rise over the past 60 days by more than 100 Confidential from Zacks Beyond this Analyst Blog would you like to see Zacks best recommendations that are not available to the public Our Executive VP Steve Reitmeister knows when key trades are about to be triggered and which of our experts has the hottest hand |
EBAY | Facebook Blames Technical Issue For Illegal Listings On Marketplace | Just one day after the launch of its new e commerce platform Marketplace was marred by listings for illegal products Facebook NASDAQ FB is saying that a technical issue is to blame for numerous posts advertising drugs animals and adult services on the site
Facebook director of product management Mary Ku told that the company is working to fix the problem
The social media giant rolled out the new Marketplace platform to all users over the age of 18 in the U S U K Australia and New Zealand this week after several months of testing in limited markets A new shop icon was added to the Facebook app allowing users to see pictures of items for sale near them
Transactions are finalized through direct message communication between the buyer and seller and all the other details including payment method and delivery are worked out without the help of Facebook
If this business model sounds familiar it s probably because you ve already heard of or used Craigslist a location based online marketplace that connects buyers and sellers Just like Craigslist Marketplace is relatively hands off and users have to arrange meeting up on their own
Marketplace actually seems to improve upon Craigslist s ideas by allowing potential buyers to view the Facebook profiles of sellers which should deter scammers Facebook s entrance into the e commerce business should also scare other reselling websites like eBay NASDAQ EBAY
For more on the launch of Marketplace check out our full story |
EBAY | EBay Reports Earnings Beat Slumps 6 5 On Weak Holiday Guidance revised | eBay Inc NASDAQ EBAY just released its third quarter fiscal 2016 financial results posting earnings of 45 cents per diluted share and revenue of 2 22 billion EBAY is a Zacks Rank 3 Hold and is down 6 5 to 30 40 per share in after hours trading shortly after its earnings report was released
Beat earnings estimates The company posted earnings of 45 cents per diluted share surpassing average analyst expectations of 44 cents per share
Beat revenue estimates The company saw revenue figures of 2 22 billion beating our consensus estimate of 2 182 billion and gaining 5 6 year over year
eBay reported gross merchandise volume of 20 1 billion increasing 5 on a foreign exchange FX neutral basis and 3 on an as reported basis
During the quarter the company generated 802 million of operating cash flow and 617 million of free cash flow from continuing operations while also repurchasing 500 million of its common stock
For the upcoming holiday quarter eBay forecast revenue of 2 36 billion to 2 41 billion and adjusted profit from continuing operations of 52 to 54 cents per share for the current quarter Analysts on average were expecting revenue of 2 40 billion and earnings of 54 cents per share
In Q3 we delivered good top and bottom line financial results led by consistent performance across our business said Devin Wenig President and CEO of eBay Inc We continued to transform the shopping experience on eBay delivered more personalization capabilities and began to activate our updated brand messaging
Here s a graph that looks at eBay s price and consensus over the past year
EBAY INC Price and Consensus
eBay is one of the world s largest online trading communities The company 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 in the United States and country specific sites in the United Kingdom Canada Germany Austria France Italy Japan Korea and Australia
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EBAY | Cooper Tire Rubber Monsanto And EBay Highlighted As Zacks Bull And Bear Of The Day | For Immediate Release
Chicago IL October 20 2016 highlights definitely Cooper Tire Rubber NYSE as the Bull of the Day and Monsanto Company NYSE MON NYSE as the Bear of the Day In addition Zacks Equity Research provides analysis on eBay Inc NASDAQ EBAY NASDAQ
Here is a synopsis of all three stocks
Headquartered in Findlay OH Cooper Tire Rubber NYSE manufactures and markets passenger cars and light truck tires and related products They have over 9 100 employees and 52 manufacturing distribution retail stores technical centers and office facilities located in more than one dozen countries around the world
Their operations are divided into four business segments North America Latin America Europe and Asia Based on sales volume they are the twelfth largest tire manufacturer in the world and the fifth largest in the US Solid Quarterly Results
The company reported earnings of 1 27 per share for Q2 significantly ahead of the Zacks Consensus Estimate of 1 07 Earnings were also much higher than 1 03 per share reported in the year ago quarter
Revenues however fell slightly short of the Zacks Consensus Estimate due to the adverse impact of price and mix and currency headwinds
The balance sheet remained strong with more than 400 million in cash and cash equivalents as of June 30 2016 and low leverage Returning Cash to Shareholders
On August 3 the company announced its 178th consecutive quarterly dividend They have also been returning cash to shareholders via buybacks They completed 372 million in share repurchases from August 2014 through August 3 2016 17 of outstanding and an additional 152 million of repurchase authorization remains through December 31 2017 Rising Estimates
Analysts have been raising their estimates for the company in the past few weeks Zacks Consensus Estimates for the current and next year are now 4 29 per share and 3 95 per share up from 4 08 and 3 81 respectively before Q2 results
Headquartered in St Louis Missouri Monsanto Company NYSE is a leading global provider of agricultural products It has two operating segments Seeds and Genomics and Agricultural Productivity
The Seeds and Genomics segment produces corn soybeans canola and cotton seeds as well as vegetable and fruit seeds This segment also develops biotechnology traits to control insects and weeds
The Agricultural Productivity segment consists of other glyphosate based herbicides for agricultural industrial ornamental and turf applications and lawn and garden herbicides Results Better than Expected but Guidance Disappoints
The company reported better than expected results for its fiscal Q4 ended Aug 31 2016
Adjusted earnings came in at 0 07 per share beating the Zacks Consensus Estimate of a loss of 0 02 and much better than the year ago loss of 0 19 per share
For fiscal 2017 the management expects earnings to be between 3 83 to 4 35 per share which was lower than street estimates Falling Estimates
Analysts have slashed their estimates for the company in view of the negative outlook Zacks Consensus Estimates for the current and the next fiscal year are 4 72 per share and 5 26 per share respectively down from 4 90 and 5 68 30 days ago Declining estimates sent the stock to a Zacks Rank 5 Strong Sell
Additional content
eBay Reports Earnings Beat Slumps on Weak Holiday Guidance
eBay Inc NASDAQ just released its third quarter fiscal 2016 financial results posting earnings of 45 cents per diluted share and revenue of 2 22 billion EBAY is a Zacks Rank 3 Hold and is down 6 5 to 30 40 per share in after hours trading shortly after its earnings report was released
Beat earnings estimates The company posted earnings of 45 cents per diluted share surpassing average analyst expectations of 44 cents per share
Beat revenue estimates The company saw revenue figures of 2 22 billion beating our consensus estimate of 2 182 billion and gaining 5 6 year over year
eBay reported gross merchandise volume of 20 1 billion increasing 5 on a foreign exchange FX neutral basis and 3 on an as reported basis
During the quarter the company generated 802 million of operating cash flow and 617 million of free cash flow from continuing operations while also repurchasing 500 million of its common stock
For the upcoming holiday quarter eBay forecast revenue of 2 36 billion to 2 41 billion and adjusted profit from continuing operations of 52 to 54 cents per share for the current quarter Analysts on average were expecting revenue of 2 40 billion and earnings of 54 cents per share
In Q3 we delivered good top and bottom line financial results led by consistent performance across our business said Devin Wenig President and CEO of eBay Inc We continued to transform the shopping experience on eBay delivered more personalization capabilities and began to activate our updated brand messaging
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WFC | Wells Fargo to pay 480 million to resolve lawsuit related to sales scandal | Reuters Wells Fargo NYSE WFC Co said on Friday it will pay 480 million to resolve a securities fraud lawsuit related to a sales scandal that surfaced in 2016 The class action lawsuit in the District Court for the Northern District of California alleged that the bank made certain misstatements and omissions in disclosures related to its sales practices The lawsuit sought damages for investors who bought Wells Fargo stocks between February 2014 and September 2016 It also accused the bank s executives of trumpeting the bank s success at cross selling while opening millions of accounts illegally
Wells Fargo had denied the claims and allegations and said it entered into an agreement to avoid the cost and disruption of further litigation |
WFC | Woods makes cut at Wells Fargo despite putting woes | Reuters Tiger Woods blamed his inability to adjust to slow greens for another mediocre putting performance in the second round at the Wells Fargo NYSE WFC Championship in North Carolina on Friday Woods missed five putts from inside 10 feet and flirted with missing the cut before scraping through with a two over par 73 at Quail Hollow in Charlotte A 13 foot birdie at his final hole was by far the longest putt he sank all day I m on a hot streak right now I made the last putt he said after posting a two over 144 halfway total that left him nine strokes behind halfway leader Peter Malnati The huge gallery that had turned up early to watch the 14 times major champion groaned almost in unison as Woods missed a four footer and a couple of six footers Not only did he squander a handful of excellent birdie chances several of them did not even threaten the hole I ve struggled with the greens being as slow as they are Woods told reporters Yesterday I was blocking them today I was pulling them trying to hit them harder and release the toe of my putter and I just wasn t doing it right I ve had ample time to make the adjustment and I haven t Playing a full schedule again this year after a successful spinal fusion in April 2017 Woods appeared to be getting his game back on track when he contended for victory twice in Florida on the PGA Tour in March Despite ultimately falling short both times he entered the U S Masters last month as one of the favorites but was never a factor as he tied for 32nd He blamed mediocre iron play for his lackluster performance at Augusta and has put a new set of irons his own signature brand into the bag this week It was his putting not his iron shots that he planned to practise on Friday afternoon I m going to do some work to get some more hit in the stroke he said I have to trust it |
WFC | Golf Leader Day gets feet wet at Wells Fargo | Reuters Jason Day needed to get his feet wet at the final hole to salvage a four under par 67 and take a two stroke lead after the third round of the Wells Fargo NYSE WFC Championship in North Carolina on Saturday
The Australian took off his shoes and socks and stood in a small creek to play a shot to the green at the 18th before coming through with a par putt to stand at 10 under 203 two strokes ahead of Nick Watney 66
Tiger Woods who has struggled with his putting this week was nine strokes off the lead after a 68 while Rory McIlroy rebounded from his 76 on Friday by going 10 strokes lower to sit seven off the lead
Day struggled to get going but four birdies in six holes on the back nine saw him break free of the pack
It was a bit of a struggle through eight holes the former world number one told CBS television
Then a nice shot into the ninth hole for a tap in birdie and a good drive down 10 kind of really started getting things in the right direction
Rookie Aaron Wise had tracked Day for most of the afternoon but bogeys on two of his last three holes dropped him into a tie for third with Peter Uihlein who narrowly missed the course record with a nine under 62 Bryson DeChambeau 66 and Englishman Paul Casey 69
Phil Mickelson also took advantage of the softer greens to shoot a seven under 64 and move into 10th at five under 208
Woods picked up six birdies to reach one under 212 but finished the round on a sour note with a three putt bogey on 18
The former world number one had moved to four under with three consecutive birdies from the 13th
I was so close to shooting about seven eight under today he told reporters I still didn t have enough pace on a couple that I left on the lip
I m close I m hitting the ball well enough to contend to win this golf tournament but I just haven t made putts
Uihlein had five consecutive birdies from the fifth an eagle at 10 and added two more birdies at the 14th and 15th as he missed McIlroy s 2015 Quail Hollow record by one shot
The way the golf course was set up today it felt like you could get after it a bit he said It played a little easier than it did the first two days
McIlroy at three under 210 had four birdies in a row before also bogeying the last
I m just not that comfortable with anything right now McIlroy told Golf Channel I m trying really hard to hit it in the fairway and then trying really hard to get my irons on line It s all just a little bit of a struggle |
WFC | Golf Woods slumps to 55th after birdie free final round | Reuters Tiger Woods had his first birdie free round since 2014 to finish equal 55th at the Wells Fargo NYSE WFC Championship in North Carolina on Sunday his second worst result of the year Woods closed with a 74 to finish at two over par 286 at Quail Hollow in Charlotte 14 strokes behind winner Jason Day It was only the 11th time in more than 1 000 rounds as a professional on the PGA Tour that Woods failed to record a birdie or eagle He again lamented poor putting but also failed to hit his approach shots close enough to the hole He had only one birdie chance from inside 10 feet a five footer that he missed at the par five 10th I hit the ball halfway decent today so I wasn t disappointed with that Woods told reporters Again just did not putt well and didn t make a birdie today I got shut out It was just a bad week In his seventh start of the year Woods 42 is well into a full throttled comeback after last April s successful back surgery He has made the cut in all but one start and seemed to be nearing his old form when he contended for victory in consecutive events in Florida in March Woods was rated among the favorites at the U S Masters in April but finished equal 32nd and blamed poor iron play He used a new set of irons at Quail Hollow his own signature brand While hardly knocking the pins down on Sunday he hit his irons well enough for the most part over the four rounds to suggest he is adjusting quickly to them The 14 times major champion said he would work on all facets of his game before the Players Championship starts in Florida on Thursday at TPC Sawgrass where he has won twice I m very pleased with the way I m swinging he said I need obviously to do some practising with my putter It s just a matter of making sure I get the right speed for those greens because they are going to be a little bit quicker than here That s a golf course you can t fake it around there and
you have to hit the ball well You can t get away with hitting it poorly |
WFC | Golf Day hits spectacular shot en route to Quail Hollow win | Reuters Former world number one Jason Day has a burning ambition to get back to the top of the rankings and he made a huge leap with a two stroke victory at the Wells Fargo NYSE WFC Championship in North Carolina on Sunday Day had an awful day of wayward driving and squandered a three shot lead on the back nine with consecutive bogeys before rising to the occasion and hitting one of the best clutch shots of his life After a birdie at the par four 16th he took aim at the par three 17th with a seven iron from 230 yards and launched his ball 142 feet as high as a 14 storey building into the air It landed some 40 feet short of the pin and finally clattered against the bottom of the flagstick on the fifth bounce Day was unlucky not to make a hole in one but the stick also saved his ball from rolling off the back of the green When I hit it it was on a cracking line it was beautiful the Australian told reporters after securing his 12th PGA Tour victory And then it just had this massive bounce hit on the downslope and fortunately hit the pin which was nice and went to about two or three feet Things like that is what you need to win golf tournaments The ensuing birdie restored Day s two shot lead and he parred the last to shoot 68 and finish at 12 under 272 two strokes ahead of Americans Aaron Wise 68 and Nick Watney 69 at Quail Hollow in Charlotte Day rated the victory one of the best of his career not because of the quality of his play but more due to his ability to get the job done without his best game I was fighting demons out there because when you re not hitting it good it just feels like the life is getting sucked out of you he said I had no idea where the ball was going today I had no confidence in my ability to hit proper tee shots I was just trying to keep it inside the tree line My short game stood the test which is nice This is probably one of the best wins I ve ever had just because of how hard everything was today It is only two years since Day dominated the game but he lost his way a bit last year A win at Torrey Pines in January showed that he was back in business and his Quail Hollow victory is projected to elevate him to seventh in the world rankings I got burnt out being number one said the 30 year old You ve got to give a lot of time to a lot of people and sometimes you don t get a lot of time to yourself Last year was a good kick in the butt not playing great and then seeing a lot of the other guys succeed So I really kind of re dedicated myself to getting back to number one
This is a good kick in the right direction having two wins this kind of early in the season My next step is to try to win a major this year |
WFC | Investors May Pay Dearly For Trying To Dodge A Bear Market | Investing com Investors unnerved by the market correction and now worried about the possibility of a bear market may be tempted to sell while stock prices are still high but they may wind up regretting that decision to try to time the market History shows the final year of a bull market is marked by some of the strongest gains according to an analysis by the Wells Fargo NYSE WFC Investment Institute Large cap stocks gain an average of about 24 in the 12 months before the bear market sets in while small cap stocks gain even more about 36 Such gains which are usually greater than the two prior years are typically driven by investors afraid of missing out on the bull market Wells Fargo advises investors should consider maintaining full equity exposure because U S economic data supports the case for continued economic recovery and further stock market gains Stock prices have been unusually volatile since an early February correction knocked more than 10 off the major averages Wells Fargo is one of the few Wall Street firms to raise its S P 500 year end forecast after the correction It s 2 950 price target is about 3 higher than the market s January peak |
WFC | U S job openings hit record high more workers quitting | By Lucia Mutikani WASHINGTON Reuters U S job openings surged to a record high in March suggesting that a recent slowdown in hiring was probably the result of employers having difficulties finding qualified workers The monthly Job Openings and Labor Turnover Survey or JOLTS released by the Labor Department on Tuesday also showed more workers voluntarily quit their jobs in March a sign of confidence in the labor market that economists believe will help to push up wage growth this year The JOLTS report bolsters expectations that inflation will accelerate and keep the Federal Reserve on track to raise interest rates at least two more times this year The U S central bank hiked interest rates in March The labor market is hot and getting hotter by the day so central bankers need to continue to take the punch bowl away because higher wages and greater inflation are on the way said Chris Rupkey chief economist at MUFG in New York Job openings a measure of labor demand increased by 472 000 to a seasonally adjusted 6 6 million March s job openings were the highest since the data series started in December 2000 For a graphic see The job openings rate rose three tenths of a percentage point to 4 2 percent also an all time high But hiring fell to 5 4 million from 5 5 million in February suggesting a skills mismatch Job growth slowed in March and April after increasing by the most in more than 1 1 2 years in February The skills mismatch was also corroborated by an NFIB survey on Tuesday showing lack of qualified workers as the single most important problem for a fifth of small businesses in April Businesses are looking for workers in just about every nook and cranny of the economy said Joel Naroff chief economist at Naroff Economic Advisors in Holland Pennsylvania FASTER WAGE INFLATION SEEN There were 112 000 additional vacancies in the professional and business services industries The construction industry had 68 000 more job openings and companies in the transportation warehousing and utilities sector had 37 000 unfilled positions In March job openings were concentrated in the Midwest and Northeast regions There was 1 0 unemployed worker per job opening in March The unemployment rate fell to a near 17 1 2 year low of 3 9 percent in April About 3 3 million Americans voluntarily quit their jobs in March up from 3 2 million in February As a result the quits rate which policymakers and economists view as a measure of job market confidence rose one tenth of a percentage point to 2 3 percent Quits accounted for a record 62 percent of separations in March At the depths of the recession they made up just a third For a graphic see Quits are also a source of upward pressure on wages said Sarah House a senior economist at Wells Fargo NYSE WFC Securities in Charlotte North Carolina The majority of workers who voluntarily change jobs receive a pay bump generating stronger wage growth for job switchers Wage growth as measured by average hourly earnings has remained moderate increasing 2 6 percent year on year in April But other gauges of wage growth have been more robust The Employment Cost Index widely seen by policymakers and economists as one of the better measures of labor market slack showed wages rising at their fastest pace in 11 years in the first quarter
Layoffs fell 56 000 to 1 56 million in March |
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