Tag Archives: ETF

GE: Improving Baseline With More Focused GE Capital [Seeking Alpha]

General Electric Company (GE), with a market cap of $239.26B, is a diversified technology and financial services company and a leader in all markets in which it competes. While all industrial segments had positive earnings growth with expanding margins in the last quarter, the progress of GE Capital (which comprises around 28.6% of GE’s value currently) had significantly improved GE’s bottom line in the past 2 years.

Improving GE Capital, Declining ENI Balance and Improving Earnings

The management continues to shrink GE Capital while improving its quality. GE uses ENI, Ending Net Investment, to measure the size of GE Capital segment. Investors should monitor ENI Balance to quantify how GE is performing against its previously communicated goal to reduce the size of financial services segment.

Below is the detail for GE Capital’s ENI as of Q4, 2012:


(Click to enlarge)

In the past 2 years, ENI had declined from $461B to $419B and achieved progress every quarter. The GECC Tier 1 common ratio had also improved from 9.9% in Q1, 2011 to 10.2% in Q4, 2012. Most importantly, the earnings had improved from $6.6B in 2011 to $7.4B in 2012, with the breakdown seen in the table below.

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Priceline And Expedia: Waiting To Buy For Long-Term Growth [Seeking Alpha]

Priceline.com Inc. (PCLN) and Expedia Inc. (EXPE) are two online travel companies, with solid growth and strong ROE. Both stocks had received positive calls from analysts recently and will be reviewed fundamentally and technically in this article. Investing strategies will also be presented.

Priceline.com Inc.

PCLN was down 0.52% and closed at $683.99 on March 21, 2013. PCLN had been trading in the range of $553.42-$774.96 in the past 52 weeks. PCLN has a market cap of $34.11B with a beta of 1.29. With estimated 19.51% annual EPS growth for the next 5 years, PCLN still has more room for upside.

On March 21, 2013, Evercore Partners assumed coverage on PCLN with an overweight rating and a price target of $850.00. Analysts currently have a mean target price of $819.08 and a median target price of $822.50 for PCLN, suggesting 19.75%-20.25% upside potential. Analysts, on average, are estimating an EPS of $5.28 with revenue of $1.28B for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $38.61 with revenue of $6.51B, which is 23.70% higher than 2012.

PCLN had announced a new long-term agreement with United Airlines, owned by United Continental Holdings Inc. (UAL), where Priceline.com customers will continue to have access to United fare content, and United and priceline.com will work together to develop innovative ancillary products and services to be delivered through the United Technology Application.

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Halliburton And Weatherford: More Upside Fueled By EPS Growth [Seeking Alpha]

Halliburton Company (HAL) and Weatherford International Ltd (WFT) are two oil well services and products providers, both with higher revenue growth and lower Forward P/E as compared to their peers. Both companies had received analysts’ upgrades recently and will be analyzed fundamentally and technically in this article. Investing strategies will also be presented.

Halliburton Company

HAL was up 0.08% and closed at $39.47 on March 21, 2013. HAL had been trading in the range of $26.28-$43.96 in the past 52 weeks. HAL has a market cap of $36.78B with a beta of 1.61. After years of integrating its drilling services, HAL has an edge with more optimized services with lower cost. By standardizing on Halliburton’s services, which placed its drilling engineering applications under one roof, customers could obtain substantially greater well performance and reduce the levels of nonproductive time.

On March 21, 2013, Guggenheim upgraded HAL from neutral to buy with a price target of $48.00 (from $42.00). Analysts currently have a mean target price of $48.63 and a median target price of $48.00 for HAL, suggesting 21.61%-23.21% upside potential. Analysts, on average, are estimating an EPS of $0.58 with revenue of $6.89B for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $3.00 with revenue of $29.69B, which is 4.20% higher than 2012.

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Intel And Microsoft: Worth A Look As Flight To Quality Begins [Seeking Alpha]

Intel Corporation (INTC) and Microsoft Corporation (MSFT) are two underdogs in the mobile and wireless market at this moment. However, it may be a good thing for investors to evaluate both undervalued stocks now as too much optimism may already be baked in for the market while it trades at a level near multi-year highs. INTC and MSFT, both with strong cash flow and trading at low Forward P/E, will be analyzed fundamentally and technically in this article. Investing strategies will also be presented.

Intel Corporation

INTC was down 0.54% and closed at $21.26 on March 18, 2013. INTC had been trading in the range of $19.23-$29.27 in the past 52 weeks. INTC has a market cap of $105.15B with a beta of 1.00.

INTC was last upgraded by Drexel Hamilton from sell to hold with a price target of $22.00 (from $18.00) on February 26, 2013. Analysts currently have a mean target price of $22.96 and a median target price of $23.00 for INTC, suggesting 8%-8.18% upside potential. Analysts are estimating an EPS of $0.42 with revenue of $12.69B for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $1.93 with revenue of $53.97B, which is 1.20% higher than 2012.

Intel is working aggressively to catch up with Qualcomm (QCOM) in the wireless market and is opening up its manufacturing technology for foundry business.

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General Motors And Johnson Controls: Low Forward P/E, Steady EPS Growth, Upgraded [Seeking Alpha]

General Motors Company (GM) and Johnson Controls, Inc. (JCI) are two auto-related companies, with low forward P/E and high expected EPS growth (next five years), receiving analysts’ upgrades recently. Both stocks will be analyzed fundamentally and technically in this article. Investing strategies will also be presented.

General Motors Company

GM was up 0.18% and closed at $28.21 on March 15, 2013. GM had been trading in the range of $18.72-$30.68 in the past 52 weeks. GM has a market cap of $38.55B.

On March 15, 2013, Equities researchers at Deutsche Bank boosted their target price on shares of GM from $38.00 to $39.00 with a “buy” rating on the stock. Analysts currently have a mean target price of $34.88 and a median target price of $35.00 for GM. Analysts are estimating an EPS of $0.56 with revenue of $36.72B for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $3.39 with revenue of $157.33B, which is 3.30% higher than 2012.

According to RDI report, signs of an improving U.S. housing market combined with upbeat readings on U.S. consumer confidence have continued to fuel the auto industry’s rally in 2013. The Fed’s policy of keeping interest rates near-zero has benefited the auto industry as a majority of Americans rely on loans to purchase new vehicles. Marketing firm LMC Automotive projects new vehicle sales to grow to 15.3 million in 2013.

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General Motors And Johnson Controls: Low Forward P/E, Steady EPS Growth, Upgraded [Seeking Alpha]

General Motors Company (GM) and Johnson Controls, Inc. (JCI) are two auto-related companies, with low forward P/E and high expected EPS growth (next five years), receiving analysts’ upgrades recently. Both stocks will be analyzed fundamentally and technically in this article. Investing strategies will also be presented.

General Motors Company

GM was up 0.18% and closed at $28.21 on March 15, 2013. GM had been trading in the range of $18.72-$30.68 in the past 52 weeks. GM has a market cap of $38.55B.

On March 15, 2013, Equities researchers at Deutsche Bank boosted their target price on shares of GM from $38.00 to $39.00 with a “buy” rating on the stock. Analysts currently have a mean target price of $34.88 and a median target price of $35.00 for GM. Analysts are estimating an EPS of $0.56 with revenue of $36.72B for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $3.39 with revenue of $157.33B, which is 3.30% higher than 2012.

According to RDI report, signs of an improving U.S. housing market combined with upbeat readings on U.S. consumer confidence have continued to fuel the auto industry’s rally in 2013. The Fed’s policy of keeping interest rates near-zero has benefited the auto industry as a majority of Americans rely on loans to purchase new vehicles. Marketing firm LMC Automotive projects new vehicle sales to grow to 15.3 million in 2013.

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2 High-Margin Apparel Brands With Recent Upgrades: Michael Kors And Coach [Seeking Alpha]

Michael Kors Holdings Ltd (KORS) and Coach, Inc. (COH) are two large-cap companies with high margins, strong ROE and cash flow, and a healthy balance sheet. Both stocks had received positive upgrades from analysts recently and will be analyzed fundamentally and technically in this article. Investing strategies will also be reviewed.

Michael Kors Holdings Ltd

KORS was up 3.96% and closed at $58.51 on March 13, 2013. KORS had been trading in the range of $35.50-$65.10 in the past 52 weeks. KORS has a market cap of $11.72B.

On Mach 13, 2013, Avondale Partners upgraded KORS from market perform to market outperform. This upgrade was based on favorable risk/reward and checks that indicate favorable trends at the end of February, 2013. On March 3, 2013, Sterne Agee initiated coverage on KORS with a neutral rating and a price target of $63.00. Analysts currently have a mean target price of $74.08 with a median target price of $75.00 for KORS. Analysts, on average, are estimating an EPS of $0.39 with revenue of $548.05M for the current quarter ending in March, 2013. For 2013, analysts are projecting an EPS of $1.86 with revenue of $2.12B, which is 63.10% higher than 2012.

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2 Recovering Stocks With More Upside Potential: Yum Brands And VeriFone [Seeking Alpha]

Yum Brands, Inc. (YUM) and VeriFone Systems, Inc. (PAY) are two companies showing positive signs for improvements. Both stocks had received positive calls from the analysts, including the PT increases for YUM and analyst’s upgrade for PAY. Both stocks will be analyzed fundamentally and technically. Investing strategies will also be reviewed.

Yum Brands, Inc.

YUM is a quick service restaurant company based on a number of system units, including KFC, Pizza Hut, and Taco Bell. YUM was up 1.31% and closed at $68.73 on March 12, 2013. YUM had been trading in the range of $59.68-$74.75 in the past 52 weeks. YUM has a market cap of $30.98B with a beta of 0.83.

As reported by Fox Business, YUM estimated same-store sales tumbled 24% in its KFC China division during Q1, which includes only the two months of January and February. The company’s Pizza Hut chain of restaurants suffered a preliminary same-store sales decline of just 2%. Overall, same-store sales slumped 20%, beating the company’s forecast for a drop of 25%.

On March 12, 2013, Goldman Sachs maintained a neutral rating on YUM and raised its price target to $65.00 (from $63.00). Adjusted for the new year shift, YUM’s China same-store-sales declined 13 percent in February compared to a decline of 22 percent in January. In the view of analysts, the improvement signals the worst is behind YUM’s in China. The analyst, Michael Kelter, said,

The improvement in underlying trend suggests that the acute phase of YUM’s recent chicken PR issue is finally behind it. The focus now is on the length of time before trends return to positive; until that time the P&L is under a significant amount of stress from China fixed cost de-leverage.

Deutsche Bank also maintained its hold rating on YUM and increased the price target to $68 (from $62).

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Oracle Keeps Buying, Growing, And Upgrading [Seeking Alpha]

Oracle Corporation (ORCL) is a provider of enterprise software and computer hardware products and services, including databases, middleware and applications. ORCL has spent $38B on acquisitions since 2005 and an active acquisition program contributes to the fundamental component of Oracle’s overall strategy.

On March 13, 2013, Oracle announced its acquisition of Nimbula, a provider of private cloud infrastructure management software. As quoted, “Nimbula’s technology helps companies manage infrastructure resources to deliver service, quality and availability, as well as workloads in private and hybrid cloud environments. Nimbula’s product is complementary to Oracle, and is expected to be integrated with Oracle’s cloud offerings. The transaction is expected to close in the first half of 2013.” According to Jim Xavier from Silicon Valley Business Journal, Nimbula could help Oracle shore up a major weakness in its product portfolio. As quoted,

“Nimbula reportedly has a very solid software, and it’s got some big customers, notably Yandex, the Russian internet firm that is sometimes called the Google of Russia.”

On March 13, 2013, Canaccord Genuity upgraded ORCL from hold to buy with a price target of $42.00 (from $35.00). Analyst Richard Davis said the firm is set up well to gain 20% this year. He expects Oracle deliver 9 to 11 percent EPS growth this year and thinks its multiple relative to peers IBM (IBM) and SAP AG (SAP) can expand given its current 10 to 25 percent discount valuation.

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Continental Resources And Hecla Mining: Strong Growth, Upgraded, Great Potential [Seeking Alpha]

Continental Resources, Inc. (CLR) and Hecla Mining Company (HL), both with strong sales growth and high margins, had received both upgrades from analysts recently. Recent developments will be updated for both companies. Both stocks will also be analyzed fundamentally and technically in this article. Investing strategies will also be presented.

Continental Resources, Inc.

Continental Resources, Inc., one of the largest oil producers in North Dakota’s prolific Bakken shale, is an independent crude oil and natural gas exploration and production company with operations in the North, South and East regions of the United States. CLR was up 1.17% and closed at $91.15 on March 8, 2013. CLR had been trading in the range of $61.02-$91.89 in the past 52 weeks. CLR has a market cap of $16.92B with a beta of 1.81.

On March 8, 2013, JPMorgan upgraded CLR from neutral to overweight with a price target of $122.00. On March 4, 2013, investment analysts at Robert W. Baird increased their target price on shares of CLR from $92.00 to $102.00 with a neutral rating. Analysts currently have a mean target price of $99.13 and a median target price of $99.00 for CLR. Analysts, on average, are estimating an EPS of $1.10 with revenue of $760.63M for the current quarter ending in March, 2013. For 2013, analyst are projecting an EPS of $5.00 with revenue of $3.44B, which is 44.70% higher than 2012.

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