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  • Square Stock – Buy Before It Grows

    Square Stock – Buy Before It Grows

    Square Stock - Buy Before It Grows
    Square, the fintech company has the same chief executive as Twitter, Jack Dorsey. Does SQ stock have another big run in store for investors? 

    By Guy Avtalyon

    The Square stock had a big drop back in August and it isn’t recovered yet. And as always it happened, traders who panicked started to sell, that caused individual investors to sell too. Since the drop in August and also, after the Q2 announcement the Square stock price held steady.

    This was a rocky year for Square stock. At the beginning of this year, the price grew, but the last quarter was disappointing for investors. The Square stock fell 25% during the past 3 months. But as far as we know, it could be a great opportunity to buy them.
    That decision depends on personal estimation on whether the stock is a chance today or it is at the risk of further dropping.

    The quarterly result expected to be released in November could be very important. The expectations among investors are lower this time but Square is still under pressure to reach its corrected estimates. If the company show increasing earnings that would be helpful for stock to rise. Analysts are expecting $597.5 million in Q3 revenue. Could they be wrong?

    Square’s revenue in the second quarter was higher by 46%. The company was generating $1.17 billion in revenue. So, we can say that this company is making money. 

    Surprisingly low guidance is what pulled the Square stock price down in the last quarter. So, the Q3 report could be a nice surprise in a positive meaning. Well, you have to know that sometimes the companies depress expectations to provide a space for recovery.

    Why to by Square stock

    Square shares are currently traded at $58.36 (the closing price on Wednesday, October, 23) which is a depressed price. The coming earnings announcement easily could put the stock price higher. 

    So, what we know from the past is – buy low, sell high. Having this in mind, this is the right time to buy Square stocks.

    The field in which Square could happen future extension is in the cannabis industry. Square’s service is open for companies selling hemp-derived CBD products legalized under the Farm Bill. As we know the cannabis industry will grow more and more. So, that is a great potential for the company and investors too. 

    Only the U.S. market is worth as much as $6 billion by 2025.

    Also, there is the company’s Cash App. Over the past 3 months, they had a great increase in users and activities. So big that the company had sales growth of 44%. This phone Cash App is a great potential for getting more customers and gain more profit. 

    Someone may say that the stock is too expensive. Yes, $58.36 isn’t cheap but it is lower than previously. But this is a fast-growing high-tech company. Keep in mind that Square’s extension isn’t done. There is still a lot of potential for developing. For long-term investors, it is a good choice. At least, it is always better to buy now before its recovery and watch how it is growing in the future. Square stock ranks among the top 10 fintech companies. It’s not unusual for big winners like SQ stock to improve more than 50% after scoring a huge run

  • Is PEG Ratio Really Useful?

    Is PEG Ratio Really Useful?

    Is PEG Ratio Really Useful?

    The PEG ratio is one of the most popular metrics. It is so easy to calculate it. It never takes more than 10 secs even if you are not good at math. 

    But, what do you think, is this extremely simple metric, this PEG ratio really useful?

    Let’s see. Let’s examine it a bit more on some examples.

    First of all, the PEG ratio or the price/earnings to growth ratio is a stock valuation measure. Investors use it to evaluate a company’s performance and investment risk. It is a measure, so it can be calculated. 

    When the PEG ratio value is 1 we can say there is an excellent bond between the company’s market value and its expected earnings growth. If the PEG ratio is higher than 1, the stock is overvalued. But when the PEG ratio is lower than 1, the stock is undervalued.

    The formula for PEG ratio is:

    PE Ratio (Price/Earnings) / Expected Growth Rate = PEG Ratio

    Assume we are examining two stocks with different characteristics

    Stock A company: 

    price – $20/share
    earnings – $4/share
    expected EPS growth – 5%

    Stock B company: 

    price – $40/share
    earnings – $4/share
    expected EPS growth = 20%

    For stock A company

    P/E ratio = $20/$4 = 5
    PEG ratio = 5/5 = 1

    For stock B company

    P/E ratio = $40/$4 = 10
    PEG ratio = 10/20 = 0.5

    If we study the P/E ratio for valuation plans, we will discover that the stock B company has an advantage because it has a P/E ratio that is 50% less than that stock A company has. But if you find that company A is going to improve its earnings 5 times faster than company B, you may modify your opinion. If you use the price to earnings growth, you will see that the stock A company trades at a lower PEG ratio than stock B company. So, what can we conclude? Company A stock may give a better value.

     

    But is that really true?

    Well, there are some weaknesses connected to the PEG ratio. Earnings growth is not an isolated thing in the market minds. To get a whole picture of the stock value you have to take care of many factors such as cash flow, dividends, revenue growth, etc.

    Further, when it comes to “growth” in the phrase “price/earnings to growth ratio” you will be faced with one problem when you are trying to value a company. You actually don’t know the rate of earnings growth. In the best case, you can guess or rely on Wall Street analysts. Having thin in mind, your PEG will be as good as your data is.

    Well, something is good with the PEG ratio. It is very useful for smaller companies but for large companies (for example Disney or Ford) where the growth isn’t so important to total returns, it can cheat.

     

    So, is the PEG ratio really useful?

    You have to keep in mind that it isn’t a mathematical result. The method is as good as its inputs. The future growth rate could be the main problem in this PEG formula. When you or any analyst make forecasts about the future it can be wrong.

    To make it clear, it is easy to calculate the PEG ratio for companies with weak growth. But, mature companies with excellent earnings and great dividends, have a slow growth rate. So, such companies will never have a PEG ratio of 1 or less. Right?

    It is almost the same for companies with fast growth.

    For instance, a company growing in a surplus of 30% per year will be incapable to maintain such a growth rate. Can you see how the PEG ratio is as good as its inputs? A huge amount of failures in the future earnings growth rises from a too optimistic or too pessimistic viewpoint for the company or industry. Getting an exact PEG ratio depends on what factors you use in the calculation. You may find that the PEG ratio is incorrect if you use historical growth rates. This one especially can lead to mistakes when future growth varies from the past.

    Bottom line

    Traders-Paradise wants to give some spotlight on the pros and cons of using the PEG ratio. As the answer to a question Is PEG ratio really useful, we can say: the PEG ratio is useful but only when you use it to improve a more precise discounted cash flow analysis or relative valuation.

     

  • NuVim Inc – Marijuana Penny Stock Under The Radar

    NuVim Inc – Marijuana Penny Stock Under The Radar

    NuVim Inc - Marijuana Penny Stock Under The Radar

    By Gorica Gligorijevic

    This company has two subsidiaries Stolle Milk Biologics, Inc., NuVim Powder, LLC. and stock price under one dollar

    Maybe you still didn’t notice this stock. But don’t worry, many didn’t. NuVim Inc stock is currently very cheap as penny stocks. It was traded at $0.0133 at the close of trading on October 21. But it is a stock worth looking out.

    Market cap $299,468
    Current price $0,0133

    NuVim Inc is a company from New Jersey. Actually, it was established in 1999 and is based in Lewes, Delaware. It sells vitamins and dietary supplement drinks. Why this particular stock is interesting to watch?

    Well, its current CEO Rick Kundrat was VP at Unilever’s Thomas J. Lipton Inc and managed the merger with Pepsi in 1991. This deserves to be noticed because of the fast-expanding cannabidiol (CBD) market global. Rick Kundrat has talked about a possible merger for NuVim merger partners. If the company moves into CBD-infused drinks it could be huge progress and stocks could be a goldmine.

    Cannabidiol is used for pain reduction. Moreover, it speeds up healing muscles and joints when have been weakened from hard exercise. But maybe the most important effect is in the field of arthritis or similar illnesses where it can help to reduce chronic pain. 

    NuVim, Inc. produces, distributes and sells beverage products

    The NuVim is a dietary supplement accessible in the refrigerated juice sections of elite supermarkets and fitness stores. You can find it in three flavors: chocolate, vanilla, and strawberry.  It helps to sustain the immune system, improves calcium absorption and digestion. NuVim contains a clinically proven natural prebiotic fiber. 

    NuVim INc is a small company with only 3 full-time employees, according to data from Yahoo Finance. From everything we know about this company, it falls into the packaged foods industry. The Company covers a range of user needs, like joint pain, muscle flexibility, wellness, weight control, nutrient supplement, and muscle recovery.

    When we put this company under the phrase “under the radar” we didn’t have its unrecognition among the investors in mind. The lack of information is obvious. It is very hard to find full information about them. The last info came from the short report:

    “During the second quarter of 2019, the company sold 1,000,000 shares of stock to Derek Spence for $10,000.”

    This was really cheap.

    As Traders-Paradise found, Derek R. Spence is Vi3’s CEO and Chairman of the Board. He joined Vi3 as an investor in 2012 and became a board member in 2014.

    Bottom line

    But what we all can see from its 3-months chart is the stock is doing well.
    Yes, it is a very low float stock that is actively seeking and interviewing merger partners. The merger could send this stock very high. Grab this stock while it is cheap and wait for it to grow.
    It isn’t expensive, honestly, it is very cheap. But this company has interesting potential. As support for this opinion, let’s repeat where is its focus. It is cannabidiol that is fast-expanding and becoming part of medicines, supplements, drinks. This company wants success and seeking for partnership telling us a lot. Grab it.

     

  • How To Know If a Stock is Worth Buying

    How To Know If a Stock is Worth Buying

    How To Know If a Stock is Worth Buying
    How to recognize if a stock is worth investing in?
    What causes a stock to be good or bad?
    What things to consider?

    By Guy Avtalyon

    How to know if a stock is worth buying? Let’s assume you are new in this field and how you can decide what stock to buy. For some investors, it is a tricky part. To be honest, it is hard for everyone. The risk is involved, the volatility of stock or market, the investment goal. Everything is on the table. But if you follow some rules connected to the estimation you can figure out how to know if the stock is worth buying. Yes, many people will tell you stock investing is like a wheel of fortune. And they are wrong. Investing is like solving the problem. Everyone has its own way, own style, but the goal is the same: solving a problem.

    Prudent investors must enter the stock investing as if they have to solve a problem. Step by step. 

    Buying stock isn’t like buying a new sofa and when you find it isn’t for your room you can take it back. When you buy stocks, you have to be convinced they will hold their value, increase in value, and you will gain profit when you sell or deliver to you notable dividends over time. The main point is to know when a stock is worth buying. 

    Look at the price

    When you have to decide if some stock is worth buying the first thing you will find is its price. You have to figure out how much the ownership of shares in some companies will cost you.

    The amount of money you have in your hands will determine how many shares you can buy but the most important is to know historical data about particular stock prices. If you find the stock has steadily increased over time you will know that you can expect a good value in the future. 

    Pay attention to revenue growth

    Share prices will grow if a company is growing. A company is growing when rising its revenue. Increasing revenue will show you if the company is strong. We can say it is a major indicator often called top line. The important part is not looking at revenue isolated. You have to observe all rise and drops in each quarter and year. And here is the tricky part. The positive trendline is good for the stock price but the revenue may be dropping or be flat and it is important to understand why that is.

    You should check the company’s current holdings, projections for future operations and stability. If you hear or read some news, no matter if they are local or even rumors that the company is doing bad, it is better to step back. You wouldn’t like to hold stocks with so much stress. Your money is involved and you could lose everything invested. So, check the company’s revenue, it is easy since almost all companies have their official websites where you can find all this info. 

    But keep one thing in mind. If it is a temporary situation and historical data shows its stock was good in price that can be good for you to buy a stock at a low price and wait for it to rebound over time.

    Some stocks may temporarily drop in price and it can be a good deal to buy them now because they have the potential to recover.

    What is the company’s earnings per share

    This info is important and you can easily count it. Just divide the leftover amount at the end of each quarter by the number of shares the company has sold, and you get the earnings per share. For example, if a company made $100 million in profits in the prior year and has 52 million shares, the earnings per share is $1.92. As an investor, you should pay attention to this since the higher earnings per share (EPS) shows you that the company is in good shape. And the tricky part again arises. Some companies can manipulate with EPS. The process is simple. They do it by buying back their shares. In that way, they are boosting EPS but not increasing profits.

    Use the technical and fundamental analysis to know if a stock is worth buying

    You will have some idea about stock’s quality if you check the prices over the past 200 days, for example. And you will see the trends. Trends are repeating. 

    Analysts think that by observing the movement over a determined period, you can define the baseline, the point where the stock should recover. Here the advice, don’t buy the stock at its highs, wait to come close to the baseline or to hit it. Some may ask how is good stock if hits the baseline. Well, when the stock hits the peak it is expensive, the price is increased, and the stock has no more space to run so the only possible scenario is to go down. If you buy a stock at its peak you will lose your money. So, it isn’t a good time to buy a stock.

    Also, perform fundamental analysis. That will show the current and projected financial aspect. Use that info to discover now’s value. Use the company’s statement and balance sheet to determine the business strength. It isn’t a 100% indicator,  but it is enough good sign of what you can expect from the company in the foreseeable future.

    How to know if a stock is worth buying

    One thing is sure and you must have that in mind when you are trying to know if a stock is worth buying.

    A company can’t manage every single thing that might affect the business. The general economy can influence the health of a company and its stock play. For example, consumer prices, the changes to interest rates can affect how a company is doing. That is not in connection with its own business. But, the stable economy produces companies’ wealth and share increases come with that. And opposite, share prices can stumble during times of economic uncertainty.

    You will find many analysts that issue reports and tips about individual stocks. These tips appear with “buy” or “sell” ratings. But analysts often disagree, so it isn’t recommended to depend on one report. Always compare several to know if a stock is worth buying.

  • This Week is Full of Q3 Earnings Reports – Stay, Watch and Monitor

    This Week is Full of Q3 Earnings Reports – Stay, Watch and Monitor

    Q3 earnings reports

    This week will start with Q3 earnings reports on Monday with Halliburton and TD Ameritrade.

    The question arises, will economic instability and trade worries continue to frighten investors? Let’s see what we can expect from the Q3 earnings reports.

    Tuesday is a day D for Procter & Gamble, McDonald’s, Kimberly-Clark, United Technologies, Chipotle Mexican Grill.

    Procter & Gamble (NYSE: PG)

     

    It will be on the schedule before the morning bell. Wall Street wants a profit of $1.24 per share and revenue of $17.4 billion to start off the company’s 2020 fiscal year.

    Procter & Gamble’s stock has grown from $81.91 in September 2018 to $117.47 now. In Septembre this year, it was $123.

    This company managed to grow earnings at a rate of 7% per year, but revenue has risen by a slight more 1% per year over the past 3 years. It is expected that the company will report earnings per share at $1,24. For the first quarter, it was $1.12. Also, the analysts’ consensus estimates revenue at $17.43 billion. That is 4.4% bigger than the $16.7 billion gained last year.

    In the last quarter of 2019, earnings rose by 17% and revenue rose by 4%. Analysts foresee earnings to increase by 7% in fiscal 2020, and revenue to increase by 3.5%. The return on equity was 23.9% and a profit margin of 21.9% which is solid for the management’s effectiveness.

    Yes, someone may say it isn’t so good if compare with some high-tech stock, but Procter & Gamble is giant, one of the oldest in the US and the consumer packaged goods company.

    McDonald’s (MCD)

     

    It looks like Mickey D’s hits an increase in third-quarter profits and sales. Investors will like to know how McDonald’s will capitalize on two new trends such as the chicken sandwich craze and the demand for meat-alternative burgers. In September, McDonald’s began testing a Beyond Meat plant-based burger in Canada. 

    McDonald’s is scheduled to report earnings on Tuesday, Oct. 22, before the market bell. According to analysts’ consensus estimate, the company is expected to report $2.21 a share profit on sales of $5.49 billion.

    McDonald’s shares are displaying peaking and finished the week at $208.50. 

    It looks that new products such as all-day breakfast or doughnut sticks attracted new consumers and Mickey D’s global sales gain a great increase. Investments in new technologies continue to pay off and are increasing traffic. Good news for investors because share momentum again revives.

    On Wednesday Ford is scheduled for Q3 Earnings Reports

    Ford Motor Company (NYSE:F)

    It will release Q3 earnings on October 23, after the market close. The fears among investor is great. The largest automakers is challenging difficulties in improving demand for its cars. Analysts forecast that the company will report $0.26 a share profit on sales of $36.86 billion.

    Ford has several very hard years behind. After so many successful years, this carmaker giant is forced to restructure because the demand for its sedan cars is decreased.

    This restructuring will result in cutting salaried jobs, some oversea factories may be closed and also the car dealer. Ford has to build the capacity to manufacture electric and driverless cars if wants to stay in the focus of buyers. And yes, the management already took some steps toward this. But the company’s shares are still under pressure and currently are traded at $9,29. At the end of the last trading week, the stock rose by 2%.

    Thursday is for Intel’s Q3 Earnings Reports.

    Intel (NASDAQ:INTC)

    Q3 Earnings Reports

     

    The globe’s largest chipmaker will also come under intense analysis when it reports earnings on Thursday, Oct. 24. It is scheduled after the close. According to analyst consensus, it is expected to report $1.23 a share profit on revenue of $18.02 billion.

    Its last report showed that the company is able to outdo everyone’s expectations. Over that period Intel Intel profited from growing demand for personal computers, and sales of higher-priced server chips. Investors will check is this semiconductor giant was able to maintain that demand surge in Q3. Also, they would like to know what are the company’s plans for the end of the year.

    Intel shares were closed at $51.36 on Friday. But have underperformed the benchmark S&P 500 Index this year. The main reason is concerns due to the trade war. If it escalates and China raises tariffs it can be tricky for this company because China is a major semiconductor market.

    Coming Q3 earnings reports could help exclude some of those questions.

    Bottom line

    This week is overflowing with questions about whether economic instability and trade worries will continue to scare investors. It will be a very hard week for many companies. What investors can do is to watch and monitor to be able to react if it is necessary.

     

  • Shefa Gems Mining Company Stock

    Shefa Gems Mining Company Stock

    Shefa Gems Mining Company Stock
    Shefa Gems is an Israeli company, a miner concentrated on precious stones.

    By Guy Avtalyon

    Shefa Gems projects are taken in Northern Israel. It is the explorer of globally recognized Carmeltazite. It is from Israel and listed on the London Stock Exchange.

    Market Cap ÂŁ8.6mln
    Price: 5 GBX

    Updated: October 29, 2019

    Shefa Gems Ltd (LON:SEFA) Death of Director Abraham Ben Leah (Avi)
    Shefa Gems announced that Avi Taub, Chief Executive Officer of the Company, has passed away following a short illness.
    Vered Toledo, Chief Operating Officer said: “We all stayed with Avi vision and we have a mission to fulfill now – open the first alluvial gems mine in the Kishon Mid Reach northern Israel – I’m sure that with the help of God we will do it all for Abraham Ben Leah blessed memory.”
    Our condolences to his family and the Shafa team.

    Is Shefa Gems publicly listed

    Shefa Gems is listed on the London Stock Exchange (LSE) under the ticker: SEFA

    In the USA trading in the Shefa Gems Shares is available via brokers such as Fidelity or Charles Schwab

    Shefa Gems Ltd (LON: SEFA) is an Israel-based exploration mining company with its operations orientated to the north of the country.

    Shefa Gems Mining Company Stock

     

    About Shefa Gems Ltd.

    Shefa Gems, formerly known as Shefa Yamim, is essentially a precious stone miner. It discovered rubies, sapphires, Carmel sapphires, and diamonds.
    Shefa Gems’ focus is on exploration targets that it believes to have the highest upside and can be taken into production at an almost low cost. The company offers its services in Israel where founded in 1999.

    Shefa Gems is a pioneer in precious stones exploration in Israel.

    We found on its official website: “The first and only company in Israel focusing exclusively in mining exploration of precious stones in the North of the holy land.”
    Shefa Gems Ltd (LON: SEFA) has delivered the highest grade results to date from Zone 2 of its Kishon Mid-Reach project in Northern Israel.
    Shefa Gems (LSE: SEFA) is currently moving towards trial mining and revenue generation at its Kishon Mid-Reach project in the Mount Carmel region of Northern Israel. Besides regulatory and operational works to reach the result, the company is developing an intelligent marketing strategy. They are creating a jewelry collection in cooperation with the internationally acclaimed designers.

    The company is a multi-commodity explorer and the Kishon Mid-Reach is its primary asset. It a 4.5km-long and 150m-wide ground. The company has separated this field into three zones. Every zone is at different stages of exploration and development. Currently, most of the work is in Zone 1

    Shefa Gems finished an independent technical-economic evaluation on Zone 1 in February 2019 and found that the first mine should be able to process 1.5Mts of gravel over 11 years. This capacity can probably be doubled, showed the result of the evaluation, by halving unit operating costs to $10.15/t.

    The Possibilities

    The company owns two prospectings and one exploration permit in northern Israel, covering a total area of 614 square kilometers. The main exploration spots are the primary volcanic sources on Mount Carmel and the secondary sources of valley-filled sediment deposits everywhere the Kishon River.

    At Mount Carmel, the company has permission for 4 sources: Rakefet Magmatic Complex, Muhraka, Har Alon, and Beit Oren.

    To date, most of the exploration work has been carried out on the Rakefet Magmatic Complex. The geological mapping and rock and soil sampling are completed. The gems and industrial minerals are found.

    At Kishon, the main exploration target is the Kishon Mid-Reach. There is the company’s most high-level exploration project and open-ended exploration activities are being initiated to determine a SAMREC compliant Mineral Resource. 

    In October this year, the company performed its highest degree results to date from Zone 2 of its Kishon Mid-Reach project in Northern Israel. A sample yielding resulted in a mineral collection grade of 467 carats per 100 tonnes.

    The company renewed its license for Zone 1 in August this year for added 12 months.

    Shefa Yamim, today Shefa Gems Ltd. is listed on the London Stock Exchange in December 2017 after a placing and subscription at 110p per ordinary share. The company’s initial market capitalization was approximately ÂŁ15.3mln. The company was 75% in the ownership of the subsidiary of Shefa Yamim Ltd, listed on the Tel Aviv Stock Exchange. After the London entry, the shareholding of Shefa Yamim Ltd has reduced to 48.9%. Traders-Paradise’s opinion is that investing this stock can have potential in the future.

     

  • AT&T – This Stock Can Beat Any Recession

    AT&T – This Stock Can Beat Any Recession

    AT&T - This Stock Can Beat Any Recession
    Why this stock is a good choice

    By Guy Avtalyon

    Could AT&T really beat a recession? According to historical data, it is a company with very good performances, a true winner. But let’s go a bit deeper.

    The high dividend yield of more than 6% is awesome
    35 years of continuously increasing
    More than 100 million customers in the US and Latin America 

    AT&T Ticker symbol T (NYSE)
    Market Cap $276.278B

    AT&T - This Stock Can Beat Any Recession

    AT&T Inc. has a great history, actually, it is the history of modern civilization. When 1874 Alexander Graham Bell invented the telephone. Two financial backers found the company that became AT&T. One year later the Bell Telephone Company, the first forerunner company to AT&T, is set up and issues stock to the seven principal shareowners. In 1946 AT&T started offering pre-cellular mobile telephone service. With only three channels available for operation, it was able to provide12 to 20 simultaneous calls in a whole area. But still…

    Next year AT&T develops the theory of cellular telephony. At that time, the technology to realize the theory did not yet exist. Actually, AT&T pioneered almost everything in telephony and communications. 

    A century and a half long history, visions, development, continuously ups, beating the crisis, and becoming greater and greater. 

    AT&T stock today

    Today, AT&T Inc. is one of the best investments you can imagine. The company offers various services like cable, wireless, satellite TV, and broadband telecommunications. This means the company has an extremely well-diversified portfolio. Revenue at more than $170 billion was up by 18% in the most recent quarter. In the same period earnings per share expanding 1.2%. 

    The company’s important $85 billion investment in Time Warner will provide AT&T access to mass-media brands such as HBO, CNN, TBS,  and TNT. Additional competitive edge comes from programming from the NBA, the NFL, MLB. Also, its acquisition of DirecTV in 2015, constituted it among the world’s biggest media companies. The management’s expectations are that this will produce earnings per share of $3.60 by the end of the fiscal year.

    AT&T dividends

    The annual ongoing dividend makes it a top pick for income investors.

    Those businesses give AT&T a wide moat, but it still has gaps. The company’s long term debt is about $158 billion, reported last quarter. The company is maybe too large scope and its wireless growth is a bit slow, the news about the number of its pay-TV customers is not good. 

    Moreover, the activists are forcing AT&T to consider some new opportunities for streamlining its stretched out business. First on the list is a spin-off of DirecTV. 

    Several weeks ago Elliott Management revealed its stake in AT&T and pushed the company to lower costs and make management reforms. One of them is to boost the stock price. Elliott stated its programs, which incorporate an important study of assets that could be traded or spun off, could raise the stock by at least 60% by the end of 2021.

    Relationship with Elliott Management 

    On Thursday, 17/10/19,  AT&T shares rose 0.74% in premarket trading to $38.09. The stock has increased 32.48% year to date and 16.34% during the past 52 weeks.
    The agreement could be reached very soon, maybe by the end of this month. But there are possibilities for agreement to fall apart, also. We will see.

    Nevertheless, analysts anticipate AT&T’s revenue to stay approximately the same next year and that earnings could rise just 2%. Those increase rates look weak, but the stock pays a yield of 5.5%. It’s also boosted its dividend annually for over 35 years.
    The company spent just 50% of its free cash flow on its dividend over the past 12 months. It expects to produce over $28 billion in free cash flow this year. That will be up from $22.4 billion in 2018. 

    AT&T and 5G 

    That could have an important influence on the company’s outlook and earnings next year. AT&T already started deploying 5G in 2018. In April this year, 19 cities had access to the company’s 5G network.  AT&T says the network will be more broadly available across the country next year.

    Investing in AT&T is a great opportunity to grow and there is an extraordinary dividend too. Having its history in mind and its penchant for developing new technologies, AT&T is the obvious winner. Moreover, it is a company that can beat any recession.

  • Invest in Saudi Arabia

    Invest in Saudi Arabia

    Invest in Saudi Arabia
    The Saudi Arabian economy, one of the strongest and most stable in the region, and has started a phase of transition. That is a great opportunity for investors.

    By Guy Avtalyon

    Invest in Saudi Arabia can be profitable but it is connected with some drawbacks. Saudi Arabia is the biggest economy in the Middle East. Its economy is growing, but at a more moderate rate than earlier, for example, during the oil growth at the beginning of this decade. Saudi Arabia’s government is spending about 7% to US$295 billion this year to encourage economic growth.

     

    The economy is still supported by rich oil reserves, but oil prices are at the lowest in the past decade. 

    The Saudi government has endorsed a national plan called ‘Vision 2030’. This plan aims to modernize and diversify the economy. They have entrusted a huge quantity of assets to the Public Investment Fund (PIF). The goal is to increase employment, especially in the private sector, in retail, healthcare, and education.

    Foreign investments are welcome too. To encourage them, the government opened the Saudi Arabian Stock Exchange, named Tadawul. 

    Tadawul

    Tadawul is the only securities exchange in Saudi Arabia with about 150 listed companies and itis controlled by the Capital Market Authority. The exchange is weighted towards the financial services and energy industries but covers many other industries. 

    The Tadawul All Share Index (TASI),  is very similar to the S&P 500. 

    The foreign investment rules are now more liberal than ever. The most important, listings and capital raises in Saudi Arabia were strong over the earlier year, while capital markets in other regional and oil-driven economies have dried up.

    Saudi Arabia can be a very attractive investment target when oil prices are rising. At the same time, it is the trickiest part. The country is depending on crude oil and it is a limited source. Despite the government’s efforts, the diversification in other industries may not show the sustained result. We will see. But there are other benefits of investing in Saudi Arabia.

    Relying on oil has some crucial benefits. Oil revenues are directed to the economic development programs managed by the government funds. Further, the government has already taken steps to privatize some industries, for example, telecom and electricity. Actually, they want to open up their market to fresh investment from foreign investors and especially in non-energy markets.

    Where to invest in Saudi Arabia

    Saudi Arabia has currently over 500 domestic funds in operation. That is the largest number of funds in the Middle East by a large margin. You can invest in asset classes such as listed equities, money market instruments, and corporate and sovereign debt. Also, private funds invest in real estate. That is the main asset for high net worth and institutional Saudi investors. Nowadays, there is an increase in private equity and venture capital due to the support of the CMA, SMEA, and other government authorities and various stimulus programs. 

    Saudi Arabia adopted seven Guiding Principles for Investment Policymaking in 2019. It includes among others, non- discrimination, investment protection, investment sustainability, transparency, protection of public policy concerns. And foreign investors are there.

    For example, Aubin Group from the UK invested $743 million, DuPont, and Alphabet. 

    The stock of foreign direct investment rose last year and reached $230 billion. Foreign investments are essentially located in the chemical industry, tourism, fuel, automobiles, etc.

    The case of Saudi Aramco

    With a net income, last year of $111.1 billion, Saudi Aramco, the kingdom’s oil company, and the world’s most profitable company is not listed in Tadawul.

    And the criteria for listing on the Tadawul aren’t as rigorous as some other exchanges like the London Stock Exchange or the New York Stock Exchange, for example.

    “What we have always said is that Aramco is ready for listing whenever the shareholders make a decision to list,” Aramco President and CEO Amin Nasser told recently to reporters at the World Energy Conference in Abu Dhabi.

    “The primary listing is to list locally but we are ready also for listing outside in other districts,” Nasser added.

    Why invest in Saudi Arabia

    If you want to invest in Saudi Arabia you should know some things. Saudi Arabia is ranked as 5th in the world for fiscal freedom. Also, it is the 3rd most rewarding tax system in the world. This country is among the 20 biggest economies and the biggest in the Middle East. It is one of the world’s fastest-growing countries and the largest free market in the Middle East. Also, Saudi Arabia is the biggest recipient of Foreign Direct Investment (FDI) among the Arab countries. The downside of investing in Saudi Arabia can be limited resources. But you can find plenty of companies to invest in. For example, it is recommended buying these stocks: THOB AL ASEEL CO., or ABDULLAH SAAD MOHAMMED ABO MOATI FOR BOOKSTORES CO., or BAAZEEM TRADING CO. Check them.

    But stay tuned, there will be more about Saudi Arabia companies good to invest in.

  • European Undervalued Stocks to Buy and Hold

    European Undervalued Stocks to Buy and Hold

    European Undervalued Stocks

    European stocks pulled back on Wednesday. Headlines on Britain’s last efforts to progress a deal with the EU left investors attached to the outcome.

    The pan-European STOXX 600 index closed down 0.1% with London’s exporter-laden FTSE 100. FTSE index, which tends to fall when the pound increases, closed with 0.6% of the decline. It looks that the expectations of a no-deal Brexit weakened.

    Germany’s GDAXI. DAX gained 0.3%, and France’s CAC 40.FCHI was flat.

    The interesting thing is that investors’ focus turns to Europe’s earnings season. Analysts assume an earnings recession to expand. Several reasons are behind this expectation. The companies fight with uncertainties about Brexit, a U.S.-China trade and Germany’s recession.

    Experts are expecting for STOXX 600 companies to report a fall of 3.7% in third-quarter earnings. Just a week ago they were forecasting a decline of  3%, so the result will be worse.

    We said this before but investing in European undervalued stocks can be very profitable despite the media reports. After Traders-Paradise gave you and short view on Asian undervalued stocks, there are some European undervalued stocks worth buying.  

    Henkel 

    Ticker symbol HENKY
    Market cap $42.215B
    Current price $23.49

    European Undervalued Stocks

     

    Here is the last half-year report for 2019 from Henkel. The company was founded in 1876 in Aachen. They marketed his first product a universal detergent with silicate used as a base.

    Today it is a big company, the German glue, and detergent maker with headquarter in DĂźsseldorf, Germany.

    At the beginning of this year, Henkel has warned profitability will fall in 2019. The company redirected investment to encourage growth in “a challenging market”. The performance last year wasn’t good and shares in Henkel dropped more than 10% after the announcement in January. Despite the company’s announcement that planned a more generous dividend policy from this year. The producer of Persil and Loctite had to informed investors that adjusted earnings per share growth would be lower than in 2018.

    Henkel still has organic growth. In the first six months of this year, sales rise by 2.8% to 4,969 million euros, organic growth +0.7%. The free cash flow in the first quarter of this year was considerably higher than in the previous year when it was 22 million euros. The company is investing in growth and improving competitiveness.

    Compared to Procter & Gamble Henkel is quite cheap. Its stocks are a very good long-term investment.

    Roche Holding AG

    Ticker symbol RHHBY
    Market Cap $245.384B
    Current price $35.74

     

    Roche Holding was founded in 1896 by Fritz Hoffmann-La Roche. In the beginning, the company was known as the producer of various vitamin preparations. Later, in 1934, the company was the first to mass-produce synthetic vitamin C, known as Redoxon. In 1957 it started production of benzodiazepines, for example, Valium and Rohypnol are the best-known. Roche has produced different HIV tests and antiretroviral drugs. Today it is the leader in manufacturing and selling various cancer drugs.

    It is a research-based healthcare company. The company operates businesses organized into two parts: Pharmaceuticals and Diagnostics. Roche develops medicines for oncology, immunology, infectious diseases, ophthalmology, and neuroscience. Its best known pharmaceutical products are Avastin, Bactrim, Bondronat, Cotellic, Dilatrend, Dormicum, Invirase, Kadcyla, Lariam,  Madopar, Neupogen, Pulmozyme, Rocaltrol, Roferon-A, among others. 

    The suggestion is to buy stock in Roche Holding AG. The company has a steady rating since September.

    BASF

    Ticker symbol BASFY
    Market Cap $67.285B
    Current price $18.27

    Its headquarters is in Ludwigshafen, Germany. The company was founded in 1865, as Badische Anilin-und Soda-Fabrik AG. There are some facts connected to its operations, actually not the bright one.  BASF was extremely influenced company from 1924 to 1947, also BASF was helping to secretly rearm Germany, at that time being a part of IG Farben. Near the end of WWII, the BASF production facilities at Ludwigshafen were bombed. 

    Today BASF SE is a chemical company and one of the largest chemical producers in the world. The BASF Group operates in more than 80 countries and contains almost 390 production sites in Europe, Asia, Australia, America, and Africa. The company has customers in more than 190 countries. 

    At the end of 2017, the company hired around 115,500 workers. The company developed its international enterprises in Asia, for example in places near Nanjing and Shanghai, China and Mangalore, India.

    The investment analysts suggest buying or holding stock in BASF SE. 

    Bottom line

    These European undervalued stocks are the companies with good competitive power, with stable balance sheets, low debts, and good cash flows. They are the cheapest in the same industry but the range of their increase can be huge and hence the profit along with it. Anyway, they are undervalued now for different reasons. That can be re-structuring, investing in researching, or something else. Everything influences the stock price as investors already know.

    Traders-Paradise chooses these three European undervalued stocks based on their market potential.

     

  • Sterling Weakened But Demands Increased

    Sterling Weakened But Demands Increased

    Sterling Weakened But Demands Increased

    Sterling weakened from five-month highs.
    Stocks in London dropped on Wednesday.
    The UK and the EU close to concluding a draft agreement on Brexit.

    Sterling has experienced decreasing from five-month highs. At the same time stocks in London fell on Wednesday. This disturbing situation came on concerns of talks between the UK and the EU to secure a Brexit deal. At this moment it looks like everything may fall apart.

    This was the second volatile day in the UK markets caused by political uncertainty about the Brexit. At the end of last week talks about Brexit were continued. To the end of last week, sterling has surged about 5%. But on Wednesday the negotiations were paused. The national currency and stocks dropped on that news. The fresh news about Michel Barnier’s optimism about getting a deal couldn’t help.

    Sterling has surged some 5% since late last week when London and Brussels restarted intense Brexit talks.

    Wednesday morning showed a bad result for sterling. Sterling was down 0.3% at $1.2731, off session lows. Also, it a lot below a five-month high of $1.28 hit the day before.

    Sterling weakened 0,3% against the euro too.

    Trading volumes have grown in recent days.  According to Refinitiv data, investors purchased and sold much more pounds than any other day in the past 12 months.
    UK and EU officials renewed talks on Wednesday, but without an agreement before the summit that will be held on Thursday. The companies listed on the London market that operate at home, such as housebuilders or banks, grown last week. For example, JP Morgan’s domestic asset basket has beaten some exporters and the blue-chip FTSE 100.
    Trading in sterling options showed high volatility in the currency.
    British government bonds profited from the restored uncertainty. The10-year yields down 3 basis points at 0.66 %. September inflation data had a limited market influence.
    Britain’s inflation rate slipped to grow as expected in September. The reason should seek in petrol prices. They dropped at the fastest rate in more than three years.

     

    But demand for the British pound has continued Wednesday.

    Investors are focused on the situation concerning Brexit. So, yesterday fresh news appeared. The UK and the EU are close to achieving an agreement on Brexit. The only concerns are will Boris Johnson gets support from Northern Ireland’s Democratic Unionist Party. Investors are waiting for the summit on Thursday. After that, the scenario of Brexit will be more clear. 

    The GBP stabilized after an important rally last week. Optimism toward the agreement of the Brexit process started to decline. EU diplomats want additional concessions from UK PM Boris Johnson. The important economic reports from the UK should come soon.