Archive for 2018

Analysts Lower Big Lots Price Targets After Q3 Print

Courtesy of Benzinga.

Analysts Lower Big Lots Price Targets After Q3 Print

Two Street analysts stuck with their bullish stances on Big Lots, Inc. (NYSE: BIG) after the stock plummeted more than 20 percent Friday in reaction to a concerning third-quarter report. 

The Analysts

Raymond James analyst Dan Wewer maintains an Outperform rating on Big Lots with a price target lowered from $48 to $36.

Bank of America Merrill Lynch’s Jason Haas maintains a Buy rating on Big Lots with a price target lowered from $56 to $40.

Raymond James Highlights Attractive Valuation

Big Lots’ Q3 report was marked by a 15-cent EPS miss, but the retailer showed an improvement in same-store sales growth from 1 percent last year to 3.4 percent, Wewer said in a note.

Sales performance was strong in the quarter across multiple categories, but Big Lots indicated comp sales decelerated in the first month of the fourth quarter, the analyst said. 

The “Store of the Future” remodel initiative is showing signs of success based on stores recording above-average growth in their second year after the remodel, Wewer said. The roughly 200 store remodels are accretive to EBIT, he said. 

The Q3 earnings miss does mark a “speed bump” in the company’s momentum and suggests the “investment thesis is beginning to appear vulnerable” due to inconsistent sales, according to Raymond James.

Nevertheless, the stock is supported by its valuation, which is among the most attractive in the hardline retail space, Wewer said. Shares are trading at an EV/EBITDA multiple of 5.5 times fiscal 2019 estimates, which is a 41-percent discount to the sector average and backed by a trailing dividend yield of 3.8 percent, which is among the highest in the space, he said. 

BofA Sees Favorable 2019

The Q3 print was disappointing, and Big Lots’ Q4 guidance fell short of expectations, Haas said in a note.

Looking forward to 2019, the ”Store of the Future” initiative could translate to comps in the high-single digit to low-double digit range, the analyst said. 

Higher-margin categories like furniture, soft home and seasonal continue to comp above the company average with no signs of reversal,


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Aurora Cannabis Expands South With Acquisition Of Farmacias Magistrales

Courtesy of Benzinga.

Aurora Cannabis Expands South With Acquisition Of Farmacias Magistrales

Leading marijuana producer Aurora Cannabis Inc (NYSE: ACB) has announced plans to establish a foothold in Mexico through the acquisition of Farmacias Magistrales. The deal announcement comes less than one week after Aurora announced an exclusive supply agreement with Farmacias Magistrales.

What Happened

Canada-based Aurora Cannabis will acquire Farmacias Magistrales SA through an all-stock deal. The exact value of the deal was not announced. The acquisition follows an agreement between Aurora Cannabis and Farmacias that calls for Aurora to supply the Mexican company with medical cannabis.

Prior to that, Farmacias Magistrales received the first and only import license for medical marijuana in the country. 

See execs from companies like these live at the Cannabis Capital Conference — learn more here!

Why It’s Important

Not only does Farmacias hold the only license to import medical marijuana into Mexico, it has also received licenses to store raw CBD and THC materials, as well as to manufacture and distribute CBD and THC products.

Farmacias has a strong distribution network across the country, with 80,000 retail points for CBD products and 500 pharmacies and hospitals for THC products. It has a 12,000-square-foot facility for the production of pharmaceuticals. 

What’s Next

Although Aurora’s latest acquisition is focused on the medical marijuana segment, the timing of the transaction should also be taken into account. In November, the country’s constitutional court ruled that a blanket ban on recreational marijuana was unconstitutional. Soon after that, Sen. Olga Sanchez, President Andres Manuel Lopez Obrador’s choice for interior minister, introduced a bill that would legalize recreational weed

Related Links:

Elon Musk Talks GM, Marijuana And More In ’60 Minutes’ Interview

Marlboro Maker Altria Takes 45% Stake In Cronos Group

Posted-In: Aurora Cannabis Cannabis in Mexico Cannabis M&ACannabis News Emerging Markets M&A Markets Best of Benzinga





10 Biggest Price Target Changes For Monday

Courtesy of Benzinga.

  • B. Riley FBR cut the price target for Comerica Incorporated (NYSE: CMA) from $107 to $84. Comerica shares closed at $74.03 on Friday.
  • Jefferies raised the price target on Equinix Inc (NASDAQ: EQIX) from $454 to $479. Equinix shares closed at $386.47 on Friday.
  • Goldman Sachs lowered the price target for Navistar International Corp (NYSE: NAV) from $43 to $23. Navistar shares closed at $28.69 on Friday.
  • B. Riley FBR cut the price target for Polaris Industries Inc. (NYSE: PII) from $126 to $99. Polaris Industries shares closed at $88.46 on Friday.
  • Keefe Bruyette & Woods lifted the price target for RenaissanceRe Holdings Ltd. (NYSE: RNR) from $143 to $168. RenaissanceRe shares closed at $139.20 on Friday.
  • Seaport Global raised the price target on Concho Resources Inc (NYSE: CXO) from $145 to $160. Concho Resources shares closed at $122.41 on Friday.
  • KeyBanc cut the price target for Micron Technology, Inc. (NASDAQ: MU) from $73 to $61. Micron shares closed at $35.31 on Friday.
  • Goldman Sachs cut Granite Construction Inc. (NYSE: GVA) price target from $58 to $50. Granite Construction shares closed at $45.49 on Friday.
  • Loop Capital raised Five Below Inc (NASDAQ: FIVE) price target from $110 to $120. Five Below shares closed at $95.58 on Friday.
  • Stifel Nicolaus boosted Synchronoss Technologies, Inc. (NASDAQ: SNCR) price target from $3 to $7. Synchronoss shares closed at $5.99 on Friday.

Posted-In: Price Target ChangesPrice Target Intraday Update Analyst Ratings





Economic Data Scheduled For Monday

Courtesy of Benzinga.

  • The Labor Department’s JOLTS report for October is schedule for release at 10:00 a.m. ET.
  • The Treasury is set to auction 3-and 6-month bills at 11:30 a.m. ET.
  • The TD Ameritrade Investor Movement Index for November will be released at 12:30 p.m. ET.

Posted-In: Economic DataNews Economics Pre-Market Outlook Markets





Dollar Slides After Goldman Capitulates, Pulls March Rate Hike Forecast

Courtesy of ZeroHedge. View original post here.

For months, Goldman's optimistic take on the economy drew raised eyebrows across both the sell and buyside, and nowhere more so than the bank's forecast for 4 Fed rate hikes in 2019, a number that is even higher than the Fed's own dot plot forecast which anticipates 3 rate hikes next year, not to mention the market's own implied prediction of less than 1 rate hike in the coming year.

Well, on Sunday night Goldman capitulated and in a note titled "The Ides of March" published late on Sunday by Jan Hatzius, the banks capitulated on its optimistic, and hawkish, projections, and now calls for less than a 50% probability of a rate hike in the March.

How does Hatzius justify this long-overdue capitulation? It's hardly the recent economic data, which while conceding that it has slowed down, Goldman notes that it has transitioned from "exceptionally strong to merely strong."

Relative to the turmoil in the financial markets, the economic numbers have been remarkably stable recently. Admittedly, jobless claims have risen and November payrolls fell somewhat short of expectations. But a report showing 155k new jobs and a decline in the (unrounded) unemployment rate to a new 48-year low of 3.67% is hardly weak in an absolute sense. Combined with the rebound in the November ISMs and firm consumer confidence readings, Friday’s report kept our current activity indicator (CAI) at 2.8% in November. This is down from a pace of 3.6% over the summer but still roughly 1 percentage point above the economy’s potential growth rate. In other words, our CAI implies that growth has transitioned from exceptionally strong to merely strong

Hatzius also observes a similar softening in inflation data, even if not one in wage growth; even so, "the wage and price inflation misses have been relatively minor, and we expect an increase in nominal wage growth to the 3¼-3½% range as well as a pickup in core PCE inflation to 2.2% by the end of 2019."

However, while Hatizus refuses to admit a slowdown in either jobs or inflation, he notes that a "much more significant change is the sharp tightening in financial conditions." As Hatzius adds, "for a variety of reasons—including an initial bout of concern about Chairman Powell’s…
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Jamie Dimon Is The New Banking ‘God’ That Wall Street Protesters Love To Hate

Courtesy of ZeroHedge. View original post here.

Jamie Dimon is now the only head of a major US Bank that was also in charge prior to the 2008 financial crisis. This is, at a bare minimum, somewhat of a testament to the job he’s been doing at the helm of the biggest US bank, which has seen its stock rise dramatically over the last 10 years.

It also makes Dimon, a billionaire, a popular target for activists and protesters who publicly take exception with how the bank profits off of industries that they don't agree with. In short, Dimon is the new banking God of Wall Street - a title previously ascribed to Lloyd Blankfein who curiously departed the Goldman helm just as the bank's 1MBD troubles hit the spotlight – and that has made him an easy target. Dimon is taking it in stride.

During Dimon's recent appearance at a community college in Ohio in November, one such activist wound up raising a banner on stage that said “Chase: Stop profiting off dirty energy.” Dimon responded in seemingly bemused fashion, according to Bloomberg, by adjusting his tie. 

Protesters that are following Dimon around are critical that the bank isn’t doing enough to fight an array of issues, ranging from climate change to private prisons to human rights abuses. In addition to showing up at events that he speaks at, they have also scaled flag poles on Park Avenue, blocked Seattle traffic with teepees and played audio of crying children outside of Dimon's apartment.

The activists have only become emboldened since Donald Trump took office. With Occupy Wall Street now out of Manhattan, the protest against Dimon represents one of the largest movements against anything in finance. It also could be a harbinger of what to expect if Dimon decides to run for President, an idea that has been tossed around, but one that Dimon has shown little public interest in.

Moira Birss, an environmentalist who interpreted for Spanish-speaking activists at the bank’s shareholder meeting, told Bloomberg: "When government actors are ignoring their responsibility to listen to regular people who don’t have lots of money, these other avenues, like corporate actors, are all the more important. People like Jamie Dimon should welcome…
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Saudi Arabia is allying with Russia to shore up oil prices as OPEC’s power wanes

 

Saudi Arabia is allying with Russia to shore up oil prices as OPEC's power wanes

File 20181207 128193 19dil0d.jpg?ixlib=rb 1.1

Saudi Minister of Energy, Industry and Mineral Resources Khalid Al-Falih. AP Photo/Ronald Zak

Courtesy of Gregory Brew, Southern Methodist University

The Organization of the Petroleum Exporting Countries likes to look united.

That’s evident when OPEC leaders meet in Vienna at the end of each year to decide how much oil its members will aim to produce the next year. There is always a show of togetherness and the appearance of the quasi-cartel’s ability to move markets.

But the truth is, OPEC is in the midst of a major crisis made more evident by Qatar’s announcement that it would be leaving OPEC, partly to protest Saudi dominance over the group.

My research has taken me through the history of oil, particularly the relationship between oil revenues, economic development and the geopolitical balance of power in the 1960s and 1970s. I believe that rather than the arbiter of global energy, OPEC has often been held back by division, disagreement and divergent interests.

This weakness helps explain why OPEC has struggled to move markets in effective ways since the 2014 collapse of oil prices. The latest production cuts, which were bigger than expected but followed considerable acrimony, are further proof that OPEC’s disunity remains intact.

Early days: Divided and powerless

OPEC was formed from frustration. In the 1950s, the world was awash in oil as small nations in the Middle East and Latin America discovered enormous deposits.

To gain access to those deposits, the major oil companies, known as the “Seven Sisters,” signed concessionary agreements with local governments. This arrangement gave the companies control over the oil – they set production levels and prices – while governments simply collected a check.

In February 1959, amid an oil glut, the Seven Sisters decided that a price correction was necessary. Acting unilaterally, they cut the price of oil, from US$2.08 to $1.80 by August 1960.

That may sound odd today, but back then oil prices didn’t always follow market forces and were typically set by the companies.…
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Is Silicon Valley Morphing Into The Morality Police?

Courtesy of ZeroHedge. View original post here.

Authored by Adrian Cohen via Creators.com,

Silicon Valley used to be technology companies. But it has become the "morality police," controlling free speech on its platforms.

What could go wrong?

In a speech Monday, Apple CEO Tim Cook said:

"Hate tries to make its headquarters in the digital world. At Apple, we believe that technology needs to have a clear point of view on this challenge. There is no time to get tied up in knots. That's why we only have one message for those who seek to push hate, division and violence: You have no place on our platforms."

Here's the goliath problem:

Who gets to define what words and phrases protected under the First Amendment constitute hate — a catchall word that is often ascribed to any offensive speech someone simply doesn't like?

Will Christians who don't support abortion rights or having their tax dollars go toward Planned Parenthood be considered purveyors of hate for denying women the right to choose? Will millions of Americans who support legal immigration, as opposed to illegal immigration, be labeled xenophobes or racists and be banned from the digital world?

Yes and yes. How do we know? It's already happening, as scores of conservatives nationwide are being shadow banned and/or censored on social media, YouTube, Google and beyond.

Their crime?

Running afoul of leftist Silicon Valley executives who demand conformity of thought and simply won't tolerate any viewpoint that strays from their rigid political orthodoxy.

For context, consider that in oppressive Islamist regimes throughout the Middle East, the "morality police" take it upon themselves to judge women's appearance, and if a woman doesn't conform with their mandatory and highly restrictive dress code — e.g., wearing an identity-cloaking burqa — she could be publicly shamed, arrested or even stoned in the town square.

In modern-day America, powerful technology companies are actively taking the role of the de facto morality police — not when it comes to dress but when it comes to speech — affecting millions. Yes, to date, those affected are not getting stoned, but they are being blocked in the…
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Eric Peters: “So You Guys Are Making Money, Who’s Losing It?”

Courtesy of ZeroHedge. View original post here.

Submitted by Eric Peters, CIO of One River Asset Management

“My guys out there all have 4-5 things going on,” said the CIO, excited, his army of traders sprawled across Gotham.

“They tell me this curve is distorted, that one isn’t. This price is out of line but not that one. They’re doing things in cash bonds versus futures. They box trades and hedge out idiosyncratic risks.”

Relative-value rates trading is offering real opportunities this year. Firms with decades in the space are reaping the rewards. “But it’s that time of year when we have to decide what to hold over year-end. What to sell. Got to take down our balance sheet.”

* * *

“So you guys are making money, who’s losing it?” I asked. When you pick up pennies and leverage it for a living, it helps to know who’s dropping them and why.

“Distressed sellers? ETFs? Bid/ask spreads widening? Are your guys getting paid to provide liquidity?” I asked.

He smiled, then answered, “Bond issuance is rising. Endless trillion-dollar deficits are just starting. And the runoff from the Fed’s balance sheet reduction keeps coming. Auctions are getting sloppy. Most people haven’t seen this environment. So now lots of people are paying us.”

“Our industry has still not adjusted to Dodd Frank,” explained the same CIO. “When markets aren’t really moving, it appears everything is fine. But when there’s any kind of volatility, it’s a very different story.”

A decade of infinite liquidity lulled us to sleep. It’s over. We’re waking. Repo rates surged Tuesday, inexplicably.

“Here’s an example: money market funds can’t lend to me. So they give cash to banks, and I get it from them, but that bloats their balance sheets, which they’re desperate to shrink. And this distorts rates, creates inefficiencies.”





Japan GDP Tumbles After Biggest CapEx Collapse Since Financial Crisis

Courtesy of ZeroHedge. View original post here.

In a world where economic growth is rapidly slowing down, and in many case contracting outright, the latest news out of Japan will hardly boost confidence that an economic recovery is just around the corner.

Moments ago Japan's Cabinet Office reported that the already contracting Q3 GDP was far worse than initially estimated, printing at -2.5% Q/Q annualized, below the -2.0% expected, and more than twice as bad as the original estimate of -1.2%. On a sequential basis, nominal GDP declined 0.7%, below the 0.5% consensus estimate.

While private consumption declined -0.2% Q/Q, slightly worse than the -0.1% expected…

…it was business spending that tumbled, plunging -2.8%, far worse than the -0.2% initial estimate, and worse than the -1.8% consensus estimate.  It was also the biggest QoQ drop in business spending since the financial crisis.

The capex slump was triggered by a series of typhoons that disrupted supply chains and a quake that knocked out power in northern Japan. Still, economists expect the impact of those one-time factors will fade, and growth should rebound in 4Q, with October industrial output data suggesting the economy rode out the 3Q bumps. Then again, it is also possible that Japan's economy has been gripped by the broader contraction resulting from the trade war between the US and China.

Whether Q4 GDP prints green, or Japan enters a technical recession, Bloomberg economists admit that further out a mild slowdown in Japan's growth is expected next year, just as the BOJ is forced to taper its QE even more.

And with Japan's GDP declining even more, this means that under the "independent" eye of Kuroda, and the watchful eye (and lower colon) of Abe, The Bank of Japan's balance sheet (553.6 trillion yen as on November 10th ) is now even larger than Japan’s annualized nominal seasonally-adjusted GDP.

Meanwhile, Japan's GDP contraction is only the latest to hit developed countries around the globe in recent weeks, from Sweden…

… to Italy…

… to Germany…

… all the way to Switzerland…

… and it is only a matter of time before the US itself follows into the red.





 
 
 

Zero Hedge

Americans' Economic Hope Has Collapsed

Courtesy of ZeroHedge. View original post here.

Which came first, the confidence or the stock market rally?

One thing is for sure, the crash in stocks in December has crushed the hope of Americans that their economic future is going to be better under President Trump.

Overall confidence dipped to 58.1 - a 4-month low, but, U.S. consumers this month were the most downbeat on the economy since November 2016, a third straight drop after expectations reached a 16-year high just three months earlier, as the partial government shutdown wears on toward a fourth week.

...



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Kimble Charting Solutions

Triple Breakout Test In Play For S&P 500!

Courtesy of Chris Kimble.

Is the rally of late about to run out of steam or is a major breakout about to take place in the S&P 500? What happens at current prices should go a long way in determining this question.

This chart looks at the equal weight S&P 500 ETF (RSP) on a daily basis over the past 15-months.

The rally from the lows on Christmas Eve has RSP testing the top of a newly formed falling channel while testing the underneath side of the 2018 trading range and its falling 50-day moving average at (1).

At this time RPS is facing a triple resistance test. Wil...



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Phil's Favorites

Brexit deal flops, Theresa May survives -- so what happens now?

 

Brexit deal flops, Theresa May survives -- so what happens now?

Courtesy of Victoria Honeyman, University of Leeds

As the clock ticks down to March 29 2019, all of the political manoeuvring, negotiating, arguing and fighting is coming to a peak. In the two and a half years since the 2016 EU referendum, views on both sides have hardened and agreement still seems as far away as it was the day after the referendum.

With Theresa May’s withdrawal agreement disliked by all sides, and voted down by an unprecedented majority in the House of Commons, everyone is wondering what can and should be done next?

...



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Digital Currencies

Crypto-Bubble: Will Bitcoin Bottom In February Or Has It Already?

Courtesy of Michelle Jones via ValueWalk.com

The new year has been relatively good for the price of bitcoin after a spectacular collapse of the cryptocurrency bubble in 2018. It’s up notably since the middle of December and traded around the psychological level of $4,000... so is this a sign that the crypto market is about to recover?

Of course, it depends on who you ask, but one analyst discovered a pattern which might point to a bottom next month.

A year after the cryptocurrency bubble popped

CCN...



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ValueWalk

D.E. Shaw Investment Calls For Leadership Change At EQT

By ActivistInsight. Originally published at ValueWalk.

Elliott Management has offered to acquire QEP Resources for approximately $2.1 billion, contending the oil and gas explorer’s turnaround efforts have done little to lift the company’s share price. The company responded and said that a thorough review of the proposition is imperative in order to properly act in the best interests of shareholders, “taking into account the company’s other alternatives and current market conditions.” The news came only a month after Travelport Worldwide agreed to sell itself to Siris Capital Group and Elliott’s private equity arm Evergreen Coast Capital for $4.4 billion in cash and two months after Athenahealth was bought by Veritas and Evergreen for $5.7 bi...



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Insider Scoop

UBS Says Disney's Streaming Ambition Gives It A 'New Hope'

Courtesy of Benzinga.

Related DIS Despite Some Risks, Analysts Still Expecting Double Digit Growth From Communications Services In Q4 ...

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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