/* Article Data (Server Side) article (o): [object Object] Content (s): Article Not Found. relatedData (o:Array(16)): 0 (o): [object Object] Headline (s): Another cliff looming for Congress? Teaser (s): Washington (CNN) Congress narrowly avoided taking the Department of Homeland Security off a cliff this week, but they're heading right back to the edge with the debt limit deadline looming. Source (s): CNN DocumentDate (s): 18 minutes ago DocumentDate_raw (n): 1425662100000 Link (s): http://www.cnn.com/2015/03/06/politics/congress-debt-limit-looming/ DocumentKey (s): HTTPwww.cnn.com/2015/03/06/politics/congress-debt-limit-looming/ DMSourceID (s): Google ContentType (s): Article 1 (o): [object Object] Headline (s): Denied by Supermarket, Man Swindles Girl Scouts With Counterfeit $100 Bill Teaser (s): Police say this man used a fake $100 bill to buy three boxes of Girl Scout cookies. When a man was turned away from a grocery store for trying to pay with a fake $100 bill, police say he found a more unsuspecting victim: Girl Scouts. Source (s): NBC Southern California DocumentDate (s): 1 hour ago DocumentDate_raw (n): 1425659400000 Link (s): http://www.nbclosangeles.com/news/local/Denied-by-Supermarket-Man-Swindles-Girl-Scouts-With-Counterfeit-100-Bill-295350481.html DocumentKey (s): HTTPwww.nbclosangeles.com/news/local/Denied-by-Supermarket-Man-Swindles-Girl-Scouts-With-Counterfeit-100-Bill-295350481.html DMSourceID (s): Google ContentType (s): Article 2 (o): [object Object] Headline (s): Laser weapon blasts through truck Teaser (s): Lockheed Martin ATHENA laser weapon system defeats a truck target by disabling the engine, demonstrating its military effectiveness against enemy ground vehicles. Source (s): Fox News DocumentDate (s): 1 hour ago DocumentDate_raw (n): 1425659400000 Link (s): http://www.foxnews.com/tech/2015/03/06/lockheed-martin-demos-high-powered-laser-weapon-blasts-through-truck/ DocumentKey (s): HTTPwww.foxnews.com/tech/2015/03/06/lockheed-martin-demos-high-powered-laser-weapon-blasts-through-truck/ DMSourceID (s): Google ContentType (s): Article 3 (o): [object Object] Headline (s): Employment Report Bolsters Case for Fed Rate Increase in June Teaser (s): (Bloomberg) -- A stronger-than-forecast U.S. payrolls report strengthens the argument for the Federal Reserve to begin raising interest rates in June, after the jobless rate reached the range that officials view as full employment. Source (s): Bloomberg DocumentDate (s): 2 hours ago DocumentDate_raw (n): 1425655653000 Link (s): http://www.bloomberg.com/news/articles/2015-03-06/employment-report-bolsters-case-for-fed-rate-increase-in-june DocumentKey (s): HTTPwww.bloomberg.com/news/articles/2015-03-06/employment-report-bolsters-case-for-fed-rate-increase-in-june DMSourceID (s): Google ContentType (s): Article 4 (o): [object Object] Headline (s): iDow: Apple to join iconic Dow stock index Teaser (s): The Dow Jones industrial average might soon be nicknamed the iDow. On Friday, the keepers of the iconic stock index said Apple, the maker of the iPhone and iPad, would be added to the blue-chip stock index when trading opens on Thursday, March 19. Source (s): USA TODAY DocumentDate (s): 3 hours ago DocumentDate_raw (n): 1425651321000 Link (s): http://www.usatoday.com/story/money/markets/2015/03/06/apple-added-to-dow/24491631/ DocumentKey (s): HTTPwww.usatoday.com/story/money/markets/2015/03/06/apple-added-to-dow/24491631/ DMSourceID (s): Google ContentType (s): Article 5 (o): [object Object] Headline (s): US STOCKS-Wall St set for lower open after payrolls report Teaser (s): ... * Feb payrolls top expectations. * International trade deficit narrows. * Foot Locker climbs in premarket after results. * Bank of America climbs after Fed stress tests. Source (s): Reuters DocumentDate (s): 3 hours ago DocumentDate_raw (n): 1425650625000 Link (s): http://www.reuters.com/article/2015/03/06/markets-stocks-usa-idUSL1N0W80Q520150306 DocumentKey (s): HTTPwww.reuters.com/article/2015/03/06/markets-stocks-usa-idUSL1N0W80Q520150306 DMSourceID (s): Google ContentType (s): Article 6 (o): [object Object] Headline (s): Malaysia Airlines Flight 370: A year of mystery, pain Teaser (s): Students from an international school in east China city Zhuji pray for the passengers onboard Malaysia Airlines flight MH370 by lighting candles on March 10, 2014. Source (s): New York Daily News DocumentDate (s): 3 hours ago DocumentDate_raw (n): 1425648800000 Link (s): http://www.nydailynews.com/news/world/malaysian-airlines-flight-370-year-article-1.2139581 DocumentKey (s): HTTPwww.nydailynews.com/news/world/malaysian-airlines-flight-370-year-article-1.2139581 DMSourceID (s): Google ContentType (s): Article 7 (o): [object Object] Headline (s): US labor market flexes muscles as February payrolls soar Teaser (s): WASHINGTON (Reuters) - U.S. employers stepped up hiring in February and the jobless rate fell to a more than 6-1/2-year low of 5.5 percent, which could put pressure on the Federal Reserve to raise interest rates in June. Source (s): Reuters DocumentDate (s): 11 hours ago DocumentDate_raw (n): 1425621979000 Link (s): http://www.reuters.com/article/2015/03/06/us-usa-economy-idUSKBN0M20E620150306 DocumentKey (s): HTTPwww.reuters.com/article/2015/03/06/us-usa-economy-idUSKBN0M20E620150306 DMSourceID (s): Google ContentType (s): Article 8 (o): [object Object] Headline (s): All 31 top banks clear 1st phase of stress tests Teaser (s): The nation's 31 largest banks stand to shed close to half a trillion dollars if the economy slumped into a deep depression, the Federal Reserve said Thursday. Source (s): USA TODAY DocumentDate (s): 19 hours ago DocumentDate_raw (n): 1425591700000 Link (s): http://www.usatoday.com/story/money/2015/03/05/stress-tests-banks-/24446599/ DocumentKey (s): HTTPwww.usatoday.com/story/money/2015/03/05/stress-tests-banks-/24446599/ DMSourceID (s): Google ContentType (s): Article 9 (o): [object Object] WSODIssue (s): |46089|72887506|255804|266905 DMSourceID (s): KAPITALL Source (s): Kapitall Headline (s): Myanmar is opening up to foreign firms, but is it time to invest? Link (s): http://folionation.squarespace.com/news/2015/3/5/myanmar-is-opening-up-to-foreign-firms-but-is-it-time-to-inv.html Thumbnail (s): DocumentDate_raw (n): 1425587940000 DocumentDate (s): March 5, 2015 DocumentDate_smart (s): 20 hours ago DocumentKey (s): 1107-290734296785735258508-31VO5R01QBCPBOI9DIPMRA1O96 ContentType (s): Article TrackingPixel (s): Teaser (s):

Myanmar, closed to all foreign investment until recently, is blowing up. Here's how you can invest.

Myanmar has only been slightly democratic since 2010, when the miliatry-junta-turned-political-party won the country's first elections in decades. The international community mostly condemned the elections as a farce, but in the years since Myanmar has continued to make incremental steps towards becoming a free-ish, fair-ish country.

Part of this process involves opening up to foreign companies and investors. On February 25, for example, Google (GOOGannounced that Gmail is now available in Burmese, or Myanma bhasa. Google search has been available in Burmese since April 2013.

Internet penetration is still very low, but it has exploded from a mere 202 users in 2002 to around 2.6 million today, or 4.9 percent of the estimated population of 53 million.

This change is largely due to the introduction of mobile phones. In June 2013, the government signed a deal with two carriers, Qatar's Ooredoo and Norway's Telenor (TELNY), in an effort to boost mobile penetration to the 75-80 percent range by 2016. In January 2015, Telenor announced it would aim to issue 1.5 million new SIM cards every month as it expanded its network throughout the country.

Banking has also begun to enter the country. In 2014, the number of bank branches in the country—all of which were at least in part government-owned—lagged behind that of Haiti and Afghanistan and only just beat South Sudan. All payments were in cash, which was transported and counted by hand. 

The government authorized nine foreign banks to operate in the country in October, albeit under stricts regulations. These include Australia and New Zealand Banking Group (ANZBY) and Sumitomo Mitsui Financial Group (SMFG). 

International investment in Myanmar will only continue to rise, assuming the government doesn't backtrack on its reforms. Foreign direct investment between March 2012 and April 2013 nearly quintupled compared to the previous year. Aung Tun Thet, an economic advisor to President Thein Sein, said the country was on track to become another Autstria, an economic gateway between different markets. In Myanmar's case, those markets would be India and China.

But the future isn't all bright for investors, leaders, or citizens in Myanmar. The country is 157th out of 175 according to Transparency International's corruption rankings. The government is embroiled in multiple wars with a shifting list of ethnic separatist armies. Fighting with the Ta'ang National Liberation Army, on one front, and the allied Arakan Army and Kachin Independence Army, intensified on Union Day, February 12, this year. 

Many investors will also be reluctant to support the current regime, even indirectly, with investment dollars. The Rohingya, a tiny Muslim minority in an overwhelmingly Buddhist country, are currently confined to internment camps under terrible conditions. Doctors Without Borders has been prevented from coming to their aid, and the Rohingya have been denied the right to vote.

On the other hand, many consider foreign investment a catalyst for positive change, in that it subjects leaders to more scrutiny from the international community.

 

Click on the interactive chart to view data over time. 

1. Australia and New Zealand Banking Group Limited (ANZBY, Earnings, Analysts, Financials): Provides banking and financial products and services to retail, small business, corporate, and institutional clients primarily in Australia and New Zealand. Market cap at $75.07B, previous close at $27.86.

 

 

2. Google Inc. (GOOG, Earnings, Analysts, Financials): Google is the world's most popular search engine. Market cap at $390.25B, most recent closing price at $573.37.

 

 

3. Sumitomo Mitsui Financial Group Inc. (SMFG, Earnings, Analysts, Financials): Provides various banking and financial products and services in Asia and the Oceania, the Americas, Europe, the Middle East, and Africa. Market cap at $54.91B, most recent closing price at $7.84.

 

 

4. Telenor ASA (TELNY, Earnings, Analysts, Financials): Operates as a telecommunication company. Market cap at $30.19B, previous close at $59.00.

 

 

 

(List compiled by David Floyd. Monthly returns data sourced from Zacks Investment Research. All other data sourced from FINVIZ.)

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© Kapitall, Inc. All rights reserved. Kapitall Wire is a division of Kapitall, Inc. Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.

Kapitall Wire offers free cutting edge investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by Kapitall Inc., and its affiliate companies.

Open a free account today get access to virtual cash portfolios, cutting-edge tools, stock market insights, and a live brokerage platform through our affiliated company, Kapitall Generation, LLC. 

Securities products and services are offered by Kapitall Generation, LLC - a FINRA/SIPC member.

10 (o): [object Object] Headline (s): Why AbbVie May Have Overpaid for Cancer Drug Maker Teaser (s): AbbVie's chief executive may have overpaid once again. Richard Gonzalez prompted the pharmaceutical giant to cough up $1.6 billion last year to free it from its bid for Irish drug manufacturer Shire. Source (s): New York Times DocumentDate (s): 21 hours ago DocumentDate_raw (n): 1425587020000 Link (s): http://www.nytimes.com/2015/03/06/business/dealbook/why-abbvie-may-have-overpaid.html DocumentKey (s): HTTPwww.nytimes.com/2015/03/06/business/dealbook/why-abbvie-may-have-overpaid.html DMSourceID (s): Google ContentType (s): Article 11 (o): [object Object] WSODIssue (s): |7069859|1607179|149059|167459|205778|218647 DMSourceID (s): KAPITALL Source (s): Kapitall Headline (s): What's wrong with HP? Link (s): http://folionation.squarespace.com/news/2015/3/5/whats-wrong-with-hp.html Thumbnail (s): DocumentDate_raw (n): 1425573540000 DocumentDate (s): March 5, 2015 DocumentDate_smart (s): Mar 5, 2015 DocumentKey (s): 1107-290734296785735258101-5OGCDG128I1N7G3MQ93JFTTODP ContentType (s): Article TrackingPixel (s): Teaser (s):

 Can HP recover from a revenue miss in the first quarter, or is it more of the same ahead?

Hewlett-Packard (HPQ) fell over 9 percent last week after it shocked investors with a revenue miss in its quarterly report. HP reported revenue of $26.8 billion for the first quarter, vs an expected $27.2 billion. Its adjusted earnings per share (EPS) was $0.92, higher than the estimated $0.91, but the company’s guidance for the second quarter was a dismal $0.84-$0.88.

Especially in light of the company’s financial outlook, the bullish case for HP is now much less convincing.

The bad news

HP blamed high separation costs for its poor results. The company is in the midst of splitting its PC and printing businesses. In the process, it expects to spend $1.3 billion this fiscal year and another $500 million in fiscal 2016. Although these charges look daunting, they account for less than 2 percent of the company’s annual operating costs.

Enterprise service sales were weak, as revenue fell 11 percent over last year.

Printing revenue declined 5 percent year-over year, or 4 percent in constant currency, which HP blamed on weak demand in Russia.

Software revenue was also down 5 percent, or 3 percent in constant currency, due to difficulties in shifting sales from software to SaaS (software as a service).

The good news

HP expects continued growth in the PC market, even though the business is contracting. Branding, channel, and scale will complement a strong product line-up.

HP’s printing unit boasted a 19.2 percent profit margin, but that was in part due to a weak yen. HP needs to keep innovating, which means more development costs and capital expenditure for printing. Investment now will benefit Multi Jet Fusion, its 3D printing initiative.

Other players

Strong hardware sales suggest Intel (INTC) and Nvidia (NVDA) could have a good year. Both are up this year, by 38.6 percent and 21.0 percent, respectively. Intel will benefit from customers upgrading their PCs’ CPUs. Nvidia’s graphics chip will also experience strong demand from the upgrade cycle. In the last quarter though, Intel’s stock is down around 8 percent. If HP’s optimism for PC sales is any indication, demand for Intel chips should be strong in 2015.

Microsoft (MSFT) is releasing Windows 10. On the server market, demand should be strong. Windows 2003 support is ending, which means enterprise customers will need to upgrade to Intel-based chips and HP servers.

Acquisition

HP announced it is buying Aruba Networks (ARUN) for $2.7 billion. According to the LA Times, the merger will help HP compete with rivals like Cisco Systems (CSCO) and gain new access to Asian markets.

The acquisition is probably less risky than its ill-fated purchase of Autonomy for $11 billion in 2011. Autonomy’s alleged accounting abuses forced HP to write down $8.8 billion from the merger.

Bottom line

HP expects earnings will be $2.03 to $2.23 per share in fiscal 2015, which means, at $34.84, the stock trades at a forward P/E of as high as 17.2. This is somewhat high for a firm that will face some turbulence as it restructures. The complexity of the separation may distract HP. Therefore, investors looking for exposure to the PC refresh cycle might be better off investing elsewhere, like in Intel or Nvidia. 

Written by Chris Lau

 

Click on the interactive chart to view data over time. 

 

1. Aruba Networks Inc. (ARUN, Earnings, Analysts, Financials): Provides distributed enterprise networks that securely connect local and remote users to corporate information technology resources worldwide. Market cap at $2.68B, most recent closing price at $24.40.

 

 

2. Cisco Systems Inc. (CSCO, Earnings, Analysts, Financials): Designs, manufactures, and sells Internet protocol (IP)-based networking and other products related to the communications and information technology industry worldwide. Market cap at $149.72B, most recent closing price at $29.33.

 

 

3. Hewlett-Packard Company (HPQ, Earnings, Analysts, Financials): Hewlett-Packard Company offers various products, technologies, software, solutions, and services to individual consumers and small- and medium-sized businesses (SMBs), as well as to the government, health, and education sectors worldwide. Market cap at $62.48B, most recent closing price at $34.19.

 

 

4. Intel Corporation (INTC, Earnings, Analysts, Financials): Engages in the design, manufacture, and sale of integrated circuits for computing and communications industries worldwide. Market cap at $161.59B, most recent closing price at $34.12.

 

 

5. Microsoft Corporation (MSFT, Earnings, Analysts, Financials): Develops, licenses, and supports a range of software products and services for various computing devices worldwide. Market cap at $353.21B, most recent closing price at $43.06.

 

 

6. NVIDIA Corporation (NVDA, Earnings, Analysts, Financials): Provides visual computing, high performance computing, and mobile computing solutions that generate interactive graphics on various devices ranging from tablets and smart phones to notebooks and workstations. Market cap at $12.19B, most recent closing price at $22.43.

 

 

(List compiled by Chris Lau. Monthly returns data sourced from Zacks Investment Research. All other data sourced from FINVIZ.)

 

Analyze These Ideas: Getting Started

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ABOUT US

© Kapitall, Inc. All rights reserved. Kapitall Wire is a division of Kapitall, Inc. Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.

Kapitall Wire offers free cutting edge investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by Kapitall Inc., and its affiliate companies.

Open a free account today get access to virtual cash portfolios, cutting-edge tools, stock market insights, and a live brokerage platform through our affiliated company, Kapitall Generation, LLC. 

Securities products and services are offered by Kapitall Generation, LLC - a FINRA/SIPC member.

12 (o): [object Object] WSODIssue (s): |36699565|25427545|264204 DMSourceID (s): KAPITALL Source (s): Kapitall Headline (s): InvenSense is on the rebound, but can it keep up momentum? Link (s): http://folionation.squarespace.com/news/2015/3/4/invensense-is-on-the-rebound-but-can-it-keep-up-momentum.html Thumbnail (s): DocumentDate_raw (n): 1425490740000 DocumentDate (s): March 4, 2015 DocumentDate_smart (s): Mar 4, 2015 DocumentKey (s): 1107-290734296785735256765-39RBSJP0QPUBBMVL6CC71E6L31 ContentType (s): Article TrackingPixel (s): Teaser (s):

Motion sensor maker Invensense is on its way back from a fall in January. Is the rebound a blip or a sign of what's to come? 

Unless the company is Synaptics (SYNA) or NXP Semiconductor (NXPI), smaller device supplier firms aren’t performing well on the stock market. InvenSense (INVN), which makes motion sensors for smartphones and tablets, fell after its quarterly earnings, but it is rebounding. Thanks partly to strong first quarter from Apple (AAPL), investors are still bidding shares higher.

Wearables, IoT market is bright

Matt Ramsay, an analyst at Canaccord Genuity, expects profit margin to improve as InvenSense supplies to the Internet of Things (IoT) and wearables market. The company relies heavily on Samsung (SSNLF) and Apple as its customer. This would explain why its non-GAAP profit margin was just 45.7 percent in the last quarter.

Looking ahead, as smart watches and IoT-related solutions are released, InvenSense will have the opportunity to sell components at a higher price. The company’s single-chip solution is attractive for IoT: the chip saves space, costs less for OEMs to implement,and allows for full connectivity and memory powering. InvenSense showcased its microelectromechanical (MEM) sensor “Sensing everything” at CES this year.

The future, less so

In its January 29 conference call, InvenSense estimated total fourth-quarter 2015 revenue would fall between $95M and $98M. Non-GAAP gross margin will be between 46 and 47 percent, and non-GAAP earnings will be between $0.11 and $0.13 per share.

Looking beyond the current quarter, if InvenSense shifts its revenue to markets outside of mobile, the stock may rebound.

Risks

Limited profitability in the smartphone and tablet space will weigh on InvenSense. If the company's gross margins fail to improve, the stock will have limited upside.

Bottom line

Even though InvenSense is up 10 percent in the last week, the stock price is stabilizing. If profitability improves, the stock will rally back to the $20 range, up sharply from its recent $16.67 closing price.

Written by Chris Lau

Click on the interactive chart to view data over time. 

1. InvenSense Inc. (INVN, Earnings, Analysts, Financials): Designs, develops, markets, and sells micro-electro-mechanical system (MEMS) gyroscopes for motion tracking devices in consumer electronics. Market cap at $1.50B, most recent closing price at $16.87.

 

 

2. NXP Semiconductors NV (NXPI, Earnings, Analysts, Financials): Provides mixed signal solutions and semiconductor components primarily in Japan, Europe, South Korea, Rest of Asia Pacific, and the Americas. Market cap at $24.65B, most recent closing price at $98.73.

 

 

3. Synaptics Inc. (SYNA, Earnings, Analysts, Financials): Develops and supplies custom-designed human interface solutions that enable people to interact with various mobile computing, communications, entertainment, and other electronic devices. Market cap at $2.99B, most recent closing price at $80.71.

 

 

(Monthly return data sourced from Zacks Investment Research. All other data soruced from FINVIZ.)

Analyze These Ideas: Getting Started

Dig Deeper: Access Company Snapshots, Charts, Filings

ABOUT US

© Kapitall, Inc. All rights reserved. Kapitall Wire is a division of Kapitall, Inc. Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.

Kapitall Wire offers free cutting edge investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by Kapitall Inc., and its affiliate companies.

Open a free account today get access to virtual cash portfolios, cutting-edge tools, stock market insights, and a live brokerage platform through our affiliated company, Kapitall Generation, LLC. 

Securities products and services are offered by Kapitall Generation, LLC - a FINRA/SIPC member.

13 (o): [object Object] WSODIssue (s): |90864|66115342|284935 DMSourceID (s): KAPITALL Source (s): Kapitall Headline (s): 3 stocks to watch when the Misery Index drops Link (s): http://folionation.squarespace.com/news/2015/3/3/3-stocks-to-watch-when-the-misery-index-drops.html Thumbnail (s): DocumentDate_raw (n): 1425416160000 DocumentDate (s): March 3, 2015 DocumentDate_smart (s): Mar 3, 2015 DocumentKey (s): 1107-290734296785735255459-5P0TI51SQT6CT5B1PC70S8AEI2 ContentType (s): Article TrackingPixel (s): Teaser (s):

Whether you knew it or not, you're less miserable than you've been at any time since 1959. Thanks, Misery Index.

Well, it's official. Americans are the least miserable they've been since the 1950s, according to Arthur Okun's misery index. The Wall Street Journal reported on Monday that the Misery Index, the sum of US inflation and the unemployment rate, hit its lowest level since 1959. Does that mean that we're back to the days of consumer paradise, when cars were 15 feet long and our only fear was nuclear obliteration?

Perhaps, perhaps not. But we can make some educated guesses about politics and the economy based on the Misery Index's historical data.

First, there's an inverse correlation between the index and incumbent presidents' odds of winning second terms, but that's irrelevant at the moment.

Second, there's a strong inverse correlation between the index and the forward P/E ratio—a valuation metric that incorporates expected growth—of the the S&P 500. So if misery goes up, forward P/E goes down. And when misery goes down, forward P/E goes up.

This probably isn't much of a revelation, but it inspired us to look for stocks that might derive particular benefit from a return to mid-century boom times. Since conventional wisdom has it that consumers devote more of their money to retail spending during good periods in the cycle, we began with the holdings of the SPDR S&P Retail ETF (XRT). To identify companies that could take the most advantage of increased consumer spending, we screened for stocks with higher gross, pretax and operating margins in the trailing twelve months (TTM) than the industry average. That ought to make anyone happy.

Click on the interactive chart to view data over time. 

1. Dollar Tree Inc. (DLTR, Earnings, Analysts, Financials): Operates discount variety stores in the United States and Canada. Market cap at $16.44B, most recent closing price at $79.92.

TTM gross margin at 37.66% vs. industry average at 34.38%. TTM operating margin at 12.42% vs. industry average at 7.84%. TTM pretax margin at 11.09% vs. industry average at 6.64%.

 

2. Sprouts Farmers Market Inc. (SFM, Earnings, Analysts, Financials): Operates as a specialty retailer of fresh, natural, and organic food in the United States. Market cap at $5.44B, most recent closing price at $35.85.

TTM gross margin at 31.89% vs. industry average at 24.06%. TTM operating margin at 6.85% vs. industry average at 5.04%. TTM pretax margin at 5.87% vs. industry average at 4.47%.

 

3. Whole Foods Market Inc. (WFM, Earnings, Analysts, Financials): Engages in the ownership and operation of natural and organic food supermarkets. Market cap at $20.26B, most recent closing price at $56.22.

TTM gross margin at 38.12% vs. industry average at 24.06%. TTM operating margin at 6.5% vs. industry average at 5.04%. TTM pretax margin at 6.57% vs. industry average at 4.48%.

 

(List compiled by David Floyd. Monthly returns data sourced from Zacks Investment Research. Profitability data sourced from Fidelity. All other data sourced from FINVIZ.)

 

Analyze These Ideas: Getting Started

Dig Deeper: Access Company Snapshots, Charts, Filings

ABOUT US

© Kapitall, Inc. All rights reserved. Kapitall Wire is a division of Kapitall, Inc. Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.

Kapitall Wire offers free cutting edge investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by Kapitall Inc., and its affiliate companies.

Open a free account today get access to virtual cash portfolios, cutting-edge tools, stock market insights, and a live brokerage platform through our affiliated company, Kapitall Generation, LLC. 

Securities products and services are offered by Kapitall Generation, LLC - a FINRA/SIPC member.

 

14 (o): [object Object] WSODIssue (s): |36276|109353|40431866|204192|268527 DMSourceID (s): KAPITALL Source (s): Kapitall Headline (s): Apple Watch could crush watchmakers Link (s): http://folionation.squarespace.com/news/2015/3/3/apple-watch-could-crush-watchmakers.html Thumbnail (s): DocumentDate_raw (n): 1425413580000 DocumentDate (s): March 3, 2015 DocumentDate_smart (s): Mar 3, 2015 DocumentKey (s): 1107-290734296785735255392-69UQJFRME4DU05KTS2RCB1BMJ7 ContentType (s): Article TrackingPixel (s): Teaser (s):

The Apple Watch release is looming over traditional watchmakers. Will they be able to adapt?

Apple (AAPL) has slated its Watch event for March 9, and the unveiling could initiate strong demand for wearable technology. Apple sold a staggering number of iPhones in the previous quarter—74.5 million, to be exact. The stock, not surprisingly, has soared. 

Yet if we believe IDC, a significant slowdown in market growth for smartphones could be ahead: year-on year increases in sales could drop to 6.2 percent by 2018, compared to a roaring 39 percent in 2013. If this proves to be the case, the Apple Watch could be a crucial step to transition into new markets.

Watchmakers in trouble

Demand for Apple Watch could grow rapidly if the firm manages to create a light, thin device with decent battery life. CEO Tim Cook appears confident that the battery could last an entire day, which might spell trouble for traditional watchmakers.

Firms such as Movado Group (MOV), Fossil (FOSL), Tiffany & Co (TIF) and Michael Kors (KORS) could all be on the ropes in the years ahead.

These stocks are already down by as much as 33 percent in the last year, in the case of Movado. The decline might be due to investors’ fears of competition from wearable technology. Swatch (UHRNz), for one, has embraced the trend and is updating its Swatch Touch. The new Swatch Touch Zero One is specifically marketed to volleyball players and can track hits, high hits, power hits and high fives.

Swiss watchmakers, who have been pressed by the Swiss franc’s rising value, are already raising prices for luxury watches. Their bet, write Pierre Taillefer and Nina Larson for AFP, is that consumers will be willing to pay more for “true luxury and perfection.”

Bottom line

If met with solid demand, the Apple Watch release could be a defining moment for Apple, already the world's largest company by market capitalization, and bad news for watchmakers.

Written by Chris Lau.

Click on the interactive chart to view data over time. 

1. Apple Inc. (AAPL, Earnings, Analysts, Financials): Designs, manufactures, and markets personal computers, mobile communication and media devices, and portable digital music players, as well as sells related software, services, peripherals, networking solutions, and third-party digital content and applications worldwide. Market cap at $751.92B, most recent closing price at $129.09.

 

2. Fossil Group Inc. (FOSL, Earnings, Analysts, Financials): Designs, develops, markets, and distributes fashion accessories worldwide. Market cap at $4.36B, most recent closing price at $86.62.

 

 

3. Michael Kors Holdings Limited (KORS, Earnings, Analysts, Financials): Engages in the design, marketing, distribution, and retailing of branded women's apparel and accessories, and men's apparel. Market cap at $13.64B, most recent closing price at $67.95.

 

 

4. Movado Group Inc. (MOV, Earnings, Analysts, Financials): Designs, sources, markets, and distributes fine watches and jewelry. Market cap at $649.90M, most recent closing price at $25.81.

 

 

 

5. Tiffany & Co. (TIF, Earnings, Analysts, Financials): Engages in the design, manufacture, and retail of fine jewelry worldwide. Market cap at $11.72B, most recent closing price at $90.60.

 

 

(List compiled by Chris Lau. Monthly returns data sourced from Zacks Investment Research. All other data sourced from FINVIZ.)

 

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With dud movies, disappointing earnings and massive layoffs, is Dreamworks a bargain or just a bad investment?

Seeing that Disney (DIS) is trading 1.8 percent from its yearly high, while for Time Warner (TWX) the figure is 6 percent, one might assume that a fellow entertainment company like Dreamworks Animation (DWA) would follow the trend. 

It turns out that's not the case. In 2014, shares traded as high as $31.35, stabilizing between $22 and $24 as investors speculated the firm would be taken over. That did not happen, and now, in the wake of disappointing fourth quarter earnings, the company must prove it can survive.

In the fourth quarter, Dreamworks lost $0.75 per share on revenue of $234.24 million. The firm was hit by restructuring charges of $210.1 million. Movies like The Penguins of Madagascar and Mr. Peabody did poorly. Its restructuring plan resulted in a staff reduction of 500. The firm also sold its campus for $185 million to SunTrust Equity Funding (STI).

The issue

The core issue is that Dreamworks is spending too much on titles that are not guaranteed to be hits. By allowing the project budget to get out of control, Dreamworks let losses grow in 2014.

One bright spot was its revenue from Television Series and Specials, which grew 7.7 percent to $50.7 million. To boost liquidity for the short term, Dreamworks increased its revolving credit facility, from $400 million to $450 million.

Risks elevated

Restructuring is never a pretty thing for companies. For Dreamworks, the company will be running with fewer staff this year. While costs will fall, it still means the company needs to release movie titles that attract an audience.

Bottom line

Dreamworks looks like a bargain stock right now, but it is filled with risks. Rumors the firm will be bought out might buoy the stock. There are no other positive catalysts at this time, but if the firm releases a hit this year, profits, and its stock price, might improve. In the meantime, it’s probably better to avoid this company.

Written by Chris Lau.

Click on the interactive chart to view data over time. 

1. The Walt Disney Company (DIS, Earnings, Analysts, Financials): Operates as an entertainment company worldwide. Market cap at $176.89B, most recent closing price at $104.08.

 

 

2. DreamWorks Animation SKG Inc. (DWA, Earnings, Analysts, Financials): Engages in the development, production, and exploitation of animated feature films and characters worldwide. Market cap at $1.82B, most recent closing price at $21.41.

 

 

3. SunTrust Banks Inc. (STI, Earnings, Analysts, Financials): Operates as the holding company for SunTrust Bank, which provides various financial services to consumer and corporate customers in the United States. Market cap at $21.51B, most recent closing price at $41.0.

 

 

4. Time Warner Inc. (TWX, Earnings, Analysts, Financials): Operates as a media and entertainment company in the United States and internationally. Market cap at $68.11B, most recent closing price at $81.86.

 

(List compiled by Chris Lau. Monthly returns data sourced from Zacks Investment Research. All other data sourced from FINVIZ.)

 

Analyze These Ideas: Getting Started

Dig Deeper: Access Company Snapshots, Charts, Filings

ABOUT US

© Kapitall, Inc. All rights reserved. Kapitall Wire is a division of Kapitall, Inc. Kapitall Generation, LLC is a wholly owned subsidiary of Kapitall, Inc.

Kapitall Wire offers free cutting edge investing ideas, intended for educational information purposes only. It should not be construed as an offer to buy or sell securities, or any other product or service provided by Kapitall Inc., and its affiliate companies.

Open a free account today get access to virtual cash portfolios, cutting-edge tools, stock market insights, and a live brokerage platform through our affiliated company, Kapitall Generation, LLC. 

Securities products and services are offered by Kapitall Generation, LLC - a FINRA/SIPC member.

 

 

 

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