Archive for 2016

Assessing Hillary’s Recount Odds

Courtesy of Mish.

Salil Mehta, founder of Statistical Ideas comments on Hillary’s recount odds in his post Losers Who Won’t Lose.

Mehta says “Based on statistical randomness of re-assessing voter intent, the chance of Hillary emerging as the victor is far less than 10%.”

I believe Mehta overstates Hillary’s odds (and I bet he agrees with my analysis).

First let’s see what Mehta has to say (emphasis his) …

The only viable path for a Hillary Clinton victory at this stage is to astoundingly uncover a wide-spread (across three states) fraud.  And that’s equally unlikely, since the basis for the voting aberrations occurred in less populated counties and anyway the three states employ three different voting mechanisms, so the fraud would have had to somehow jointly occur through different transmission vehicles (paper voting, and electronic voting) and we would require a speedy judicial resolution for states such as Pennsylvania that sidestepped back-up recordings from their direct voting equipment.

We should note the following statistical facts about the electoral vote in the three recount states:

  • 10 votes, Wisconsin (Trump leads by 0.9 percentage points)
  • 20 votes, Pennsylvania (Trump leads by 1.1 percentage points)
  • 16 votes, Michigan (Trump leads by 0.2 percentage points)

Given that Mr. Trump won by 74 electoral votes, Ms. Clinton would need to flip all three states noted above, in order to liquidate this deficit (i.e., >74/2 = >37 votes).  The leads described above however, among 4.4 million voters from these three states, is highly statistically significant on a state-level (and certainly when all three states are combined).  It would be remarkably unlikely (>5σ event) that we would arbitrarily second-guess every one of these millions of voters’ intents and, convert any (certainly let alone all) of these three states.

Hillary must be cognizant of this improbability, and so instead is foolishly piggy-backing off of the second most reasonable recount rationale: not that errors in intent occurred, but rather straight-fraud on such a scale that would flip most of these states.  While tempting for Democrat supporters, this fraud scenario is of course dubious and a humiliating ploy at this stage.  Because for it to work, we would need to suppose that such fraud occurred in three different ways at once:

  • Michigan is a paper-ballot state (no equipment hacking possible) so electronic fraud is virtually unlikely to come about
  • Wisconsin does have


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Baird Maintains Outperform On Costco Ahead Of Wednesday’s November Comps Results

Courtesy of Benzinga.

Baird Maintains Outperform On Costco Ahead Of Wednesday's November Comps Results

Baird reiterated its Outperform rating on Costco Wholesale Corporation (NASDAQ: COST) ahead of the membership warehouse operator’s November sales results due out Wednesday.

The brokerage, which has a price target of $175 on the Costco shares, expects global core comps of 2 percent (similar to October), while its reported comp estimate of 1–2 percent is in line with the Street’s 1.5 percent.

Analyst’s Take

Analyst Peter Benedict noted that the higher traffic should be a key driver of Costco‘s near-term sales and should help the company weather continued deflationary pressures on average ticket and weakness in tobacco.

“While compares ticked up ~100bps (~200bps in the U.S.), the shift in Halloween into the November reporting period (Halloween is a strong traffic day for COST) and moving past hurricane-related disruption should benefit U.S. comps relative to October,” Benedict wrote in a note.

In addition, easing comparisons and increased recognition by members of the new co-branded Visa credit card should boost near-term results. The analyst’s bullish thesis is also based on potential U.S./Canadian fee increase and probability of even another special dividend.

At last check, shares of Costco were flat at $151.88.

Latest Ratings for COST

Date Firm Action From To
Nov 2016 Edward Jones Upgrades Hold Buy
Oct 2016 Northcoast Research Upgrades Neutral Buy
Oct 2016 Wells Fargo Initiates Coverage On Market Perform

View More Analyst Ratings for COST


View the Latest Analyst Ratings

Posted-In: Analyst Color Earnings Long Ideas News Price Target Previews Reiteration Analyst Ratings Best of Benzinga





Vetr Crowd Thinks GameStop Is Ready To Play

Courtesy of Benzinga.

On Monday, the Vetr Crowd upgraded their rating for GameStop Corp. (NYSE: GME) from 2.5 stars (Buy) to 3 stars (Strong Buy). Crowd sentiment for the stock is good, with 72 percent of Vetr user ratings bullish.

This upgrade come after a rough couple of months for the video game retailer, whose shares declined 35.5 percent from $32.16 to a year-long low of $20.73 on November 4. Shares  were looking a little healthier, fluctuating around $25.11 on Mponday afternoon.

Overall analyst sentiment is still middling after Autumn losses. Piper Jaffray downgraded the stock earlier this month to Neutral in light of the company’s early November dip.

See how crowdsourced ratings could help you time the markets.

Vetr’s crowd target price is down at $24.79, which is well below the average analyst target price of $30.97. Less than 2 percent of Vetr users hold GME in their watch lists.

Posted-In: VetrUpgrades Crowdsourcing Analyst Ratings General





Insurance Stocks May Have Risen Too Far Too Fast

Courtesy of Benzinga.

Insurance Stocks May Have Risen Too Far Too Fast

Randy Binner of FBR Capital Markets has downgraded Metlife Inc (NYSE: MET), Hartford Financial Services Group Inc (NYSE: HIG) and Maiden Holdings, Ltd. (NASDAQ: MHLD) to Market Perform, saying the risk/reward for these stocks have become less attractive after the election rally.

Following Donald Trump’s win, Binner said, on average, life names have climbed 15 percent, property/casualty have risen 11 percent and mortgage insurers have advanced 7 percent.

The rally was attributed to the higher rate environment, potential benefit from a lower corporate tax rate and the benefit of deregulation.

Insurance Rally Specifics

“In general, our analysis indicates that insurance stocks have factored in many of these potential benefits. The challenge, of course, is that yields could again move lower, and tax reform and deregulation are not certain,” Binner wrote in a note.

On Metlife, Binner said his analysis shows shares efficiently discounting spread, tax and deregulation factors post-election, while the upcoming spin catalyst and associated buyback are now better priced into shares.

On Hartford, the post-election rally has put shares close to FBR’s $47 price target, while Maiden shares jumped 17 percent despite seen only marginally benefiting from higher rates.

“Given its Bermuda domicile, the name does not see much potential tax benefit, nor a benefit from deregulation. MHLD is trading at 92 percent of its five-year min/max P/E valuation,” Binner continued.

Under-Discounted Stocks

The analyst said the following stocks have under discounted the benefit of the post-election environment:

  • AFLAC Incorporated (NYSE: AFL).
  • Allstate Corp (NYSE: ALL).
  • AmTrust Financial Services Inc (NASDAQ: AFSI).
  • MGIC Investment Corp. (NYSE: MTG).
  • NMI Holdings Inc (NASDAQ: NMIH).
  • Progressive Corp (NYSE: PGR).
  • Radian Group Inc (NYSE: RDN).
  • Travelers Companies Inc (NYSE: TRV).

Analyst’s Changes

Further, Binner raised the price targets of the following companies.

market.png

Latest Ratings for AFL

Date Firm Action From To
Oct 2016 Credit Suisse Initiates Coverage on Underperform
Sep 2016 Wells Fargo Assumes Market Perform
Aug 2016 SunTrust Robinson Humphrey Maintains Neutral

View More Analyst Ratings for AFL


View the Latest Analyst Ratings

Posted-In: Analyst Color Long Ideas News Short Ideas Downgrades Price Target Reiteration Analyst Ratings Best of Benzinga





Benzinga’s Volume Movers

Courtesy of Benzinga.

  • China Petroleum & Chemical Corp (ADR) (NYSE: SNP) surged 1.7 percent to $70.84. The volume of China Petroleum & Chemical shares traded was 704 percent higher than normal. China Petroleum shares have surged 12.62 percent over the past 52 weeks, while the S&P 500 index has gained 6.39 percent in the same period.
  • Time Inc (NYSE: TIME) shares moved up 16.5 percent to $15.85. The volume of Time traded was 616 percent higher than normal. Time rejected an $18 per share bid from Edgar Bronfman Jr., the New York Post reported.
  • Cognizant Technology Solutions Corp (NASDAQ: CTSH) shares gained 8.9 percent to $57.98. The volume of Cognizant shares traded was 397 percent higher than normal. Elliott issued a letter to Cognizant outlining value-enhancement plan.
  • Health Insurance Innovations Inc (NASDAQ: HIIQ) shares rose 13.6 percent to $12.77. The volume of Health Insurance shares traded was 217 percent higher than normal. Health Insurance shares have jumped 107.56 percent over the past 52 weeks, while the S&P 500 index has gained 6.39 percent in the same period.

Posted-In: volume moversNews Intraday Update Markets Movers





Technical Alert: S&P 500 Index Futures Lower

Courtesy of Benzinga.

  • 2211.75 – Friday high (all-time-high)
  • 2211.25 – Friday close (all-time-high close)
  • 2209.50 – Intraday high as of 11:26 AM
  • 2203.00 – Current price as of 11:26 AM
  • 2199.50 – Current low as of 11:26 AM
  • 2192.00 – November 22 low

Posted-In: Futures Technicals Intraday Update Markets Movers Trading Ideas





Under Armour’s Endorsement Spending Could Hamper Top-, Bottom-Line Growth

Courtesy of Benzinga.

Under Armour's Endorsement Spending Could Hamper Top-, Bottom-Line Growth

The aggressive spending by Under Armour Inc (NYSE: UA) on endorsements could weigh on its margins while setting a high bar for revenue growth, according to a recent note from Stifel.

The brokerage, which has a Hold rating on the stock, said Under Armour’s aggressive endorsement commitments in recent years “set a high bar for revenue growth and heighten the risk of material earnings power compression if sales growth slows, even modestly.”

Filings

The regulatory filings show that the athletic footwear maker spent $127 million in year one commitments and $858 million in total commitments in 2015. But, this year, the company is investing heavily on endorsements, potentially leading to the greatest percentage increase in sponsorship commitments with the next 10K filing.

“Assuming 25 percent revenue and 40 percent endorsement growth fueled by recent and anticipated commitments, we estimate a 190bps headwind from endorsement commitments over five years (from 2.6 percent to 4.5 percent of sales),” analyst Jim Duffy wrote in a note.

Further, the analyst noted that endorsement obligations could result in 360bps deleverage and pressure margins, assuming 40 percent endorsement growth and 17.5 percent revenue growth.

As such, Duffy believes the company’s top-line growth prospects are balanced against imminent margin pressure, primarily driven by heavy endorsement spending. The analyst also cut the price target to $28 from $33.

At last check, shares of Under Armour had risen 2.61 percent on the day to trade at $31.40.

Latest Ratings for UA

Date Firm Action From To
Oct 2016 Mizuho Downgrades Buy Neutral
Oct 2016 Atlantic Equities Downgrades Overweight Neutral
Oct 2016 Cowen & Co. Downgrades Outperform Market Perform

View More Analyst Ratings for UA


View the Latest Analyst Ratings

Posted-In: Jim Duffy StifelAnalyst Color News Price Target Reiteration Analyst Ratings Movers Best of Benzinga





Key Trends In Online Shopping This Holiday Season

Courtesy of Benzinga.

Key Trends In Online Shopping This Holiday Season

As online retailers kick off Cyber Monday sales, early Black Friday numbers this holiday season seem to be mixed. The National Retail Federation (NRF) is reporting that 154 million shoppers made purchases over Black Friday weekend, up from 151 million in 2015. However, those 154 million consumers spent an average of only $290, down from $300 last year.

Further Mixed Results

NRF data also shows no surprises when it comes to the secular shift from brick-and-mortar retail to e-commerce. This weekend, more than 108 million shoppers made online purchases, up from 103 million in 2015. Only 99 million shoppers went to stores during Black Friday weekend, 3 million less than a year ago.

For retail investors, perhaps the most important statistic that NRF reported is that only 9 percent of shoppers say they finished their holiday shopping over the weekend, meaning there’s still plenty of holiday business remaining.

Looking ahead to the rest of the holiday season, comScore believes technology will dominate online shopping.

“[The] 2016 holiday season will be all about gadgets – more connected devices than ever before are gaining adoption for the first time or becoming mainstream,” the firm said.

Streaming TV devices, such as Rokus, Amazon.com, Inc. (NASDAQ: AMZN)’s fire TV, Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL)’s Chromecast and Apple Inc. (NASDAQ: AAPL)’s Apple TV, remain the most popular in-home connected devices.

ComScore noted that the 2016 holiday shopping season should get a boost from two extra calendar days than 2015, strong spending momentum from the first three quarters of the year, low gas prices and an uptick in wage growth.

However, there are plenty of headwinds as well. The firm mentions post-election hangover, increasingly negative consumer sentiment, job security concerns and weather among the factors retail investors should monitor closely.

At last check, the SPDR S&P Retail (ETF) (NYSE: XRT) was down 0.77 percent on the day to trade at $46.28. Over the past five trading days, however, the ETF is up 2.1 percent.

Posted-In: News Topics Events Econ #s Movers Tech Trading Ideas General Best of Benzinga





Benzinga’s Top Downgrades

Courtesy of Benzinga.

Benzinga's Top Downgrades

  • Jefferies downgraded Citigroup Inc (NYSE: C) from Buy to Hold. Citigroup shares fell 0.93 percent to $56.25 in pre-market trading.
  • Analysts at B. Riley downgraded Tupperware Brands Corporation (NYSE: TUP) from Neutral to Sell. The price target for Tupperware has been lowered from $64 to $47. Tupperware shares fell 2.13 percent to $58.02 in pre-market trading.
  • Evercore ISI Group downgraded Marriott International Inc (NASDAQ: MAR) from Buy to Hold. Marriott shares fell 0.22 percent to $78.34 in pre-market trading.
  • FBR Capital downgraded Metlife Inc (NYSE: MET) from Outperform to Market Perform. MetLife shares dropped 0.45 percent to $55.20 in pre-market trading.
  • Analysts at Wedbush downgraded Panera Bread Co (NASDAQ: PNRA) from Outperform to Neutral. Panera Bread shares fell 0.34 percent to close at $217.16 on Tuesday.
  • BTIG Research downgraded H & R Block Inc (NYSE: HRB) from Neutral to Sell. H&R Block shares rose 1.27 percent to close at $23.98 on Friday.
  • Analysts at Credit Suisse downgraded Mentor Graphics Corp (NASDAQ: MENT) from Outperform to Neutral. Mentor Graphics shares gained 0.55 percent to close at $36.76 on Friday.
  • RBC Capital downgraded Robert Half International Inc. (NYSE: RHI) from Outperform to Sector Perform. Robert Half International shares rose 1.03 percent to close at $45.26 on Friday.
  • Maxim Group downgraded Darden Restaurants, Inc. (NYSE: DRI) from Buy to Hold. Darden Restaurants shares fell 0.73 percent to $74.40 in pre-market trading.
  • Analysts at Compass Point downgraded Unum Group (NYSE: UNM) from Buy to Neutral. Unum shares dropped 0.44 percent to $42.70 in pre-market trading.

Latest Ratings for C

Date Firm Action From To
Nov 2016 Jefferies Downgrades Buy Hold
Nov 2016 Macquarie Downgrades Outperform Neutral
Nov 2016 Morgan Stanley Upgrades Equal-Weight Overweight

View More Analyst Ratings for C


View the Latest Analyst Ratings

Posted-In: Top DowngradesDowngrades Analyst Ratings





The Market In 5 Minutes: Castro, Trump And Oil In Focus

Courtesy of Benzinga.

The Market In 5 Minutes: Castro, Trump And Oil In Focus

Macro Focus

Futures for the Dow Jones Industrial Average fell 63 points to 19,081.00, while the Standard & Poor’s 500 index futures dropped 7 points to 2,204.25. Futures for the Nasdaq 100 index declined 11.25 points to 4,857.25.

Oil prices traded lower as Brent crude futures fell 0.42 percent to trade at $47.04 per barrel, while US WTI crude futures also fell 0.46 percent to trade at $45.85 a barrel.

  • The Dallas Fed general activity index for November will be released at 10:30 a.m. ET.
  • The Treasury is set to auction 3-and 6-month bills at 11:30 a.m. ET.

BZ News Desk Focus

“Since 1987 the Dow has posted gains from Black Friday close until year end 22 out of 28 times.”

That means the year-end trade has worked more than 78 percent of the time for nearly three decades. Benzinga took a closer look at the numbers over the past 10 years.

Sell-Side Themes

Jefferies changed its tune on a few financial stocks. Among others, Wells Fargo (NYSE: WFC) and Citigroup (NYSE: C) were downgraded to Hold, while Comerica (NYSE: CMA) and US Bancorp (NYSE: USB) were upgraded to Buy.

Sell-Side’s Most Noteworthy Calls

  • Wedbush downgraded Panera Bread (NASDAQ: PNRA) to neutral.
  • FBR Capital downgraded MetLife (NYSE: MET) to Market Perform.
  • Goldman Sachs upgraded ConocoPhillips (NYSE: COP) to Buy.
  • Evercore ISI upgraded Fiat Chrysler (NYSE: FCAU) to Buy.
  • Rodman & Renshaw started Imprimis Pharma (NASDAQ: IMMY) at Buy.


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Phil's Favorites

Congress is considering privacy legislation - be afraid

 

Congress is considering privacy legislation – be afraid

Courtesy of Jeff Sovern, St. John's University

Supreme Court Justice Louis Brandeis called privacy the “right to be let alone.” Perhaps Congress should give states trying to protect consumer data the same right.

For years, a gridlocked Congress ignored privacy, apart from occasionally scolding companies such as Equifax and Marriott after their major data breaches. In its absence, ...



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Zero Hedge

Key Events This Week: Trade War, EU Elections, Durables, PMIs And Fed Minutes

Courtesy of ZeroHedge

Looking at this week's key events, Deutsche Bank's Craig Nicol writes that while the unpredictable nature of US-China trade developments will likely continue to be the main focus for markets again next week, we also have the European Parliament elections circus to look forward to as well as various survey reports including the flash May PMIs which may offer some insight into the impact of trade escalation on economic data. The FOMC and ECB meeting minutes are also due, along with a heavy calendar of Fed officials speaking.

The European Parliament elections will kick off next Thursday with voting continuing into the weekend across the continent, with results expected on Sunday. With the elections surrounded by internal and external challenges for the EU, members di...



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Kimble Charting Solutions

Will S&P 500 Double Top Derail The Rally?

Courtesy of Chris Kimble.

The rally off the December stock market lows has been strong, to say the least. The S&P 500 rallied 25 percent before hitting and testing the 2018 high.

The old highs proved to be formidable resistance and ushered in some volatility in May… and a 5 percent pullback.

In today’s 2-pack, we look at that resistance level – could that be a double top? We can see similar patterns develop on the S&P 500 Index and its Equal Weight counterpart.

Both indexes are testing short-term Fibonacci retracement levels of the recent decline at point (2).

What takes place here after potential double top highs will be important. Stay tuned...



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Insider Scoop

60 Biggest Movers From Friday

Courtesy of Benzinga.

Gainers
  • Fastly, Inc. (NYSE: FSLY) shares jumped 50 percent to close at $23.99 on Friday. Fastly priced its 11.25 million share IPO at $16 per share.
  • Outlook Therapeutics, Inc. (NASDAQ: OTLK) shares climbed 37.3 percent to close at $2.10 on Friday after the stock rose over 68 percent Thursday following an Oppenheimer initiation at Outperform with a price target of $12.
  • Cray Inc. (NASDAQ: CRAY) shares rose 22.5 percent to close at $36.52 after Hewlett Packard Enterpri...


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Chart School

Weekly Market Recap May 18, 2019

Courtesy of Blain.

China – U.S. trade talk continued to dominate the week.   A heavy selloff Monday was followed by 3 up days, with Friday moderately down.

On Monday, Chinese officials announced retaliatory tariffs against the U.S., hitting $60 billion in annual exports to China with new or expanded duties that could reach 25%.

Then on Wednesday:

The Trump administration plans to delay a decision on instituting new tariffs on car and auto part imports for up to six months, according to media reports.

...

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Digital Currencies

Cryptocurrencies are finally going mainstream - the battle is on to bring them under global control

 

Cryptocurrencies are finally going mainstream – the battle is on to bring them under global control

The high seas are getting lower. dianemeise

Courtesy of Iwa Salami, University of East London

The 21st-century revolutionaries who have dominated cryptocurrencies are having to move over. Mainstream financial institutions are adopting these assets and the blockchain technology that enables them, in what ...



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Biotech

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

Reminder: We are available to chat with Members, comments are found below each post.

 

DNA as you've never seen it before, thanks to a new nanotechnology imaging method

A map of DNA with the double helix colored blue, the landmarks in green, and the start points for copying the molecule in red. David Gilbert/Kyle Klein, CC BY-ND

Courtesy of David M. Gilbert, Florida State University

...



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ValueWalk

More Examples Of "Typical Tesla "wise-guy scamminess"

By Jacob Wolinsky. Originally published at ValueWalk.

Stanphyl Capital’s letter to investors for the month of March 2019.

rawpixel / Pixabay

Friends and Fellow Investors:

For March 2019 the fund was up approximately 5.5% net of all fees and expenses. By way of comparison, the S&P 500 was up approximately 1.9% while the Russell 2000 was down approximately 2.1%. Year-to-date 2019 the fund is up approximately 12.8% while the S&P 500 is up approximately 13.6% and the ...



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Members' Corner

Despacito - How to Make Money the Old-Fashioned Way - SLOWLY!

Are you ready to retire?  

For most people, the purpose of investing is to build up enough wealth to allow you to retire.  In general, that's usually enough money to reliably generate a year's worth of your average income, each year into your retirement so that that, plus you Social Security, should be enough to pay your bills without having to draw down on your principle.

Unfortunately, as the last decade has shown us, we can't count on bonds to pay us more than 3% and the average return from the stock market over the past 20 years has been erratic - to say the least - with 4 negative years (2000, 2001, 2002 and 2008) and 14 positives, though mostly in the 10% range on the positives.  A string of losses like we had from 2000-02 could easily wipe out a decades worth of gains.

Still, the stock market has been better over the last 10 (7%) an...



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Mapping The Market

It's Not Capitalism, it's Crony Capitalism

A good start from :

It's Not Capitalism, it's Crony Capitalism

Excerpt:

The threat to America is this: we have abandoned our core philosophy. Our first principle of this nation as a meritocracy, a free-market economy, where competition drives economic decision-making. In its place, we have allowed a malignancy to fester, a virulent pus-filled bastardized form of economics so corrosive in nature, so dangerously pestilent, that it presents an extinction-level threat to America – both the actual nation and the “idea” of America.

This all-encompassing mutant corruption saps men’s souls, crushes opportunities, and destroys economic mobility. Its a Smash & Grab system of ill-gotten re...



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OpTrader

Swing trading portfolio - week of September 11th, 2017

Reminder: OpTrader is available to chat with Members, comments are found below each post.

 

This post is for all our live virtual trade ideas and daily comments. Please click on "comments" below to follow our live discussion. All of our current  trades are listed in the spreadsheet below, with entry price (1/2 in and All in), and exit prices (1/3 out, 2/3 out, and All out).

We also indicate our stop, which is most of the time the "5 day moving average". All trades, unless indicated, are front-month ATM options. 

Please feel free to participate in the discussion and ask any questions you might have about this virtual portfolio, by clicking on the "comments" link right below.

To learn more about the swing trading virtual portfolio (strategy, performance, FAQ, etc.), please click here ...



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Promotions

Free eBook - "My Top Strategies for 2017"

 

 

Here's a free ebook for you to check out! 

Phil has a chapter in a newly-released eBook that we think you’ll enjoy.

In My Top Strategies for 2017, Phil's chapter is Secret Santa’s Inflation Hedges for 2017.

This chapter isn’t about risk or leverage. Phil present a few smart, practical ideas you can use as a hedge against inflation as well as hedging strategies designed to assist you in staying ahead of the markets.

Some other great content in this free eBook includes:

 

·       How 2017 Will Affect Oil, the US Dollar and the European Union

...

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About Phil:

Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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Ilene is editor and affiliate program coordinator for PSW. She manages the site market shadows, archives, more. Contact Ilene to learn about our affiliate and content sharing programs.

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