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.

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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


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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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Zero Hedge

Johns Hopkins, Bristol-Myers Face $1 Billion Suit For Infecting Guatemalan Hookers With Syphilis 

Courtesy of ZeroHedge. View original post here.

A federal judge in Maryland said Johns Hopkins University, pharmaceutical company Bristol-Myers Squibb and the Rockefeller Foundation must face a $1 billion lawsuit over their roles in a top-secret program in the 1940s ran by the US government that injected hundreds of Guatemalans with syphilis, reported Reuters.

Several doctors from Hopkins an...



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Phil's Favorites

This Is The One Chart Every Trader Should Have "Taped To Their Screen"

Courtesy of Zero Hedge

After a year of tapering, the Fed’s balance sheet finally captured the market’s attention during the last three months of 2018.

By the start of the fourth quarter, the Fed had finished raising the caps on monthly roll-off of its balance sheet to the full $50bn per month (peaking at $30bn USTs, $20bn MBS, although on many months the (balance sheet) B/S does not actually shrink by this full amount which depends on the redemption schedule) and by end-Q4 markets also experienced some of the largest volatility and drawdowns in nearly a decade.

As Nomura&...



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ValueWalk

The Competition For Capital Has Made Stocks Cheap

By Michelle Jones. Originally published at ValueWalk.

The new year is upon us, and now is the time many investors look at what 2018 was and prepare for what 2019 might be. Recession jitters are starting to pick back up again, especially now that the full picture of 2018 is in the books. But what if you could pick only one theme for 2018? Jefferies strategist Sean Darby and team have a suggestion which is especially timely given that it appears to mark the end of an era.

StockSnap / PixabayVolatility carries into the new year

This past year was one of extremes, and the markets ended i...



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Kimble Charting Solutions

Stock declines did not break 9-year support, says Joe Friday

Courtesy of Chris Kimble.

We often hear “Stocks take an escalator up and an elevator down!” No doubt stocks did experience a swift decline from the September highs to the Christmas eve lows. Looks like the “elevator” part of the phrase came true as 2018 was coming to an end.

The first part of the “stocks take an escalator up” seems to still be in play as well despite the swift decline of late.

Joe Friday Just The Facts Ma’am- All of these indices hit long-term rising support on Christmas Eve at each (1), where support held and rallies have followed.

If you find long-term perspectives helpf...



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Digital Currencies

Transparency and privacy: Empowering people through blockchain

 

Transparency and privacy: Empowering people through blockchain

Blockchain technologies can empower people by allowing them more control over their user data. Shutterstock

Courtesy of Ajay Kumar Shrestha, University of Saskatchewan

Blockchain has already proven its huge influence on the financial world with its first application in the form of cryptocurrencies such as Bitcoin. It might not be long before its impact is felt everywhere.

Blockchain is a secure chain of digital records that exist on multiple computers simultaneously so no record can be erased or falsified. The...



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Insider Scoop

Cars.com Explores Strategic Alternatives, Analyst Sees Possible Sale Price Around $30 Per Share

Courtesy of Benzinga.

Related 44 Biggest Movers From Yesterday 38 Stocks Moving In Wednesday's Mid-Day Session ...

http://www.insidercow.com/ more from Insider

Chart School

Weekly Market Recap Jan 13, 2019

Courtesy of Blain.

In last week’s recap we asked:  “Has the Fed solved all the market’s problems in 1 speech?”

Thus far the market says yes!  As Guns n Roses preached – all we need is a little “patience”.  Four up days followed by a nominal down day Friday had the market following it’s normal pattern the past nearly 30 years – jumping whenever the Federal Reserve hints (or essentially says outright) it is here for the markets.   And in case you missed it the prior Friday, Chairman Powell came back out Thursday to reiterate the news – so…so… so… patient!

Fed Chairman Jerome Powell reinforced that message Thursday during a discussion at the Economic Club of Washington where he said that the central bank will be “fle...



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Members' Corner

Why Trump Can't Learn

 

Bill Eddy (lawyer, therapist, author) predicted Trump's chaotic presidency based on his high-conflict personality, which was evident years ago. This post, written in 2017, references a prescient article Bill wrote before Trump even became president, 5 Reasons Trump Can’t Learn. ~ Ilene 

Why Trump Can’t Learn

Donald Trump by Gage Skidmore (...



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Biotech

Opening Pandora's Box: Gene editing and its consequences

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

 

Opening Pandora's Box: Gene editing and its consequences

Bacteriophage viruses infecting bacterial cells , Bacterial viruses. from www.shutterstock.com

Courtesy of John Bergeron, McGill University

Today, the scientific community is aghast at the prospect of gene editing to create “designer” humans. Gene editing may be of greater consequence than climate change, or even the consequences of unleashing the energy of the atom.

...

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Mapping The Market

Trump: "I Won't Be Here" When It Blows Up

By Jean-Luc

Maybe we should simply try him for treason right now:

Trump on Coming Debt Crisis: ‘I Won’t Be Here’ When It Blows Up

The president thinks the balancing of the nation’s books is going to, ultimately, be a future president’s problem.

By Asawin Suebsaeng and Lachlan Markay, Daily Beast

The friction came to a head in early 2017 when senior officials offered Trump charts and graphics laying out the numbers and showing a “hockey stick” spike in the nationa...



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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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About Ilene:

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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