Post by yogibearbull on Jul 31, 2021 16:36:51 GMT
Pg 10-11.
REVIEW. Forget crypto ETFs, mutual fund/OEF BTCFX based on front-month Bitcoin futures started trading on Wednesday. It will require monthly roll of Bitcoin futures and may diverge from Bitcoin spot prices.
PREVIEW. General Electric/GE easily beat earnings estimates and raised guidance for free cash flow. CULP’s turnaround since 2018 remains on track despite the hit from pandemic. Bullish analyst targets for GE are in mid/high-teens.
DATA THIS WEEK. ISM manufacturing PMI, construction spending on MONDAY; factory orders on TUESDAY; auto sales, ISM services PMI, ADP national employment on WEDNESDAY; international trade deficit on THURSDAY; jobs report (+800K), unemployment rate (5.8%) on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. GlaxoSmithKline (GSK; stock has lagged for almost a decade; new aggressive plans for growth; spinning off consumer-healthcare joint venture in 2022; activist Elliott Management is involved; pg 13);
small-cap Atlas Technical Consultants (ATCX; fwd P/E 14; fwd EV/EBITDA 8; net debt/EBITDA 5.5 (high); simplifying complex capital structure; became public in early-2020 via SPAC merger; businesses include engineering and design services, inspection and certification of buildings and public works, public and private infrastructure projects; 30% revenue from new projects, 70% from inspection and maintenance of existing buildings and infrastructure; very strong backlog; industry consolidator; pg 17).
BEARISH. See other stories.
Pg 14: FUNDS. ACTIVISTS are targeting underperforming CEFs. Those run by famous managers are not spared – Saba has 20% stake in HASENSTAB’s GIM and won 4 board seats. Saba is also involved with HIE, SOR, VTA; Bulldog is involved with NDP. Vulnerable are ADX, RGT, FUND. But a bill in CONGRESS may restrict activist activities by (1) limiting activists to 10% ownership of CEFs (but they may join hands with other activists), (2) allowing CEFs to invest more than 15% in illiquid private funds (venture-capital, private-equity) and that would make quick tender offers or liquidations difficult. Even now, the hedge funds are limited to owning 3% of CEFs, but they get around this restriction by owning CEFs through affiliated entities. STATES also have securities laws that make it difficult for hedge funds to takeover CEFs. It would be interesting to see how all this plays out among the fund industry (and ICI), activists, the SEC, states and Congress.
Pg 19: 100 YEARS OF BARRON’S reviews the history of RESTAURANT industry and factors affecting it – modern kitchen equipment, franchises, driving culture, drive-in features, coin-operated music, notions of fast-food, casual and fast-casual dining, variety of ethnic foods, etc.
Pg 27: FUNDS. Matthew MOBERG of large-cap growth FKDNX (ER 0/85% for class A; no-load/NTF at Fidelity and Schwab) looks for innovative companies with high earnings growth and their trailing P/Es may be high.
Pg 29: CHINA’s crackdown on big techs, private education industry and the US-listed Chinese companies has investors scrambling. It seems that Chinese government and regulators can pick any target and cause havoc without considering implications for investors. Avoid individual companies and use ETFs (MCHI, A-shares ASHS, energy CHIE, utilities CHIU, materials CHIM) and active funds (FHKCX, OBCHX, MCSMX).
Pg 30: TECH TRADER. Big tech big earnings came and went, and investors were unimpressed. The pandemic boom may be over even with Covid-19-Delta gaining strength. Spending patterns are shifting from online to physical purchases (travel, restaurants, events, etc). Component shortage are widespread. Digital transformation is continuing, and cloud business is strong. Regulatory threats to big techs remain.
Pg 31: INCOME. PINDER (UBS) has a model to identify high dividend-growth stocks: MS, GS, BC, RJF, PHM, SWKS, DE, LEN, etc.
Stocks with high potential for dividend restoration include MAR, WFC, etc.
Pg 32: Richard PARSONS, former Chairman of Citigroup/C, former CEO of Time Warner, former Chairman of CBS. Now on several corporate boards (LAZ, EL, MSGS) and blockchain related Celo Foundation (Celo is a phone-based payment platform). Surprisingly, media content and distribution don’t create synergies. Digital trends are accelerating – streaming, etc. Cable will be around, but cable TV bundles may disappear. Theaters are also not going away as people enjoy the big screen and theater experience. There is room for 2 or more big players in every media area, but smaller players will also linger. Digital transformation is coming to financial services via cryptos. Issues with minorities and underserved communities cannot be addressed overnight. Sustained efforts are needed to promote education, entrepreneurship and opportunities.
Pg 34. OTHER VOICES. Gina RAIMONDO, US Secretary of Commerce. America’s CARE-economy (involving kids, aging parents, care workers) is in crisis. Unavailable or unaffordable care can impact return-to-work plans and economic recovery; care was expensive even before Covid-19. 7.5 million UNEMPLOYED workers cite childcare issues and 1.9 million unemployed cite eldercare issues. The SANDWICH-generation is caught between job and caregiving demands. WOMEN are more impacted – almost 2 million women have left the workforce since February 2020 and women’s workforce participation is now the lowest in 30 years. INVESTMENTS are needed to make care affordable, care-worker training, new care facilities, flexible work environment and policies. Every $1 invested in childcare and early education can return $8.60 in societal benefits. CONGRESS needs to pass some related laws.
(EXTRAS from online Friday that didn’t make the weekend paper version)
FOLLOWUP. CRASH in Chinese stocks/ADRs listed (only) in the US has made investors aware of their hidden risks from the US and Chinese regulators. Their VIE structure is under scrutiny both from the US and China (and those seem to be feeding on each other) and the fear now is that the VIE may be declared fraudulent. Some affected companies have dual-listed in HK or China Mainland, but others may be forced to go private (as they may be unable to meet new US and/or Chinese rules). Both the US and China have now put restrictions on any such new IPOs. The ETF PGJ that is based on the US-listed Chinese stocks is down -44% since mid-February. Chinese education stocks TAL, EDU are down -90% and DIDI crashed soon after its US IPO – on adverse Chinese actions/reactions. More cooperating Jack MA of BABA is laying low after the Ant IPO was forcibly scrapped. Chinese big techs now trade like value stocks (BABA fwd P/E 18) compared to their US or global counterparts. Investors would be wise to access Chinese stocks (listed anywhere) via mutual funds and ETFs.
FUNDS. Robinhood/HOOD had a dismal IPO, but Cathie WOOD (Ark Investment) bought it for ARKK.
LINK
REVIEW. Forget crypto ETFs, mutual fund/OEF BTCFX based on front-month Bitcoin futures started trading on Wednesday. It will require monthly roll of Bitcoin futures and may diverge from Bitcoin spot prices.
PREVIEW. General Electric/GE easily beat earnings estimates and raised guidance for free cash flow. CULP’s turnaround since 2018 remains on track despite the hit from pandemic. Bullish analyst targets for GE are in mid/high-teens.
DATA THIS WEEK. ISM manufacturing PMI, construction spending on MONDAY; factory orders on TUESDAY; auto sales, ISM services PMI, ADP national employment on WEDNESDAY; international trade deficit on THURSDAY; jobs report (+800K), unemployment rate (5.8%) on FRIDAY.
www.barrons.com/magazine?mod=BOL_TOPNAV
BULLISH. GlaxoSmithKline (GSK; stock has lagged for almost a decade; new aggressive plans for growth; spinning off consumer-healthcare joint venture in 2022; activist Elliott Management is involved; pg 13);
small-cap Atlas Technical Consultants (ATCX; fwd P/E 14; fwd EV/EBITDA 8; net debt/EBITDA 5.5 (high); simplifying complex capital structure; became public in early-2020 via SPAC merger; businesses include engineering and design services, inspection and certification of buildings and public works, public and private infrastructure projects; 30% revenue from new projects, 70% from inspection and maintenance of existing buildings and infrastructure; very strong backlog; industry consolidator; pg 17).
BEARISH. See other stories.
Pg 14: FUNDS. ACTIVISTS are targeting underperforming CEFs. Those run by famous managers are not spared – Saba has 20% stake in HASENSTAB’s GIM and won 4 board seats. Saba is also involved with HIE, SOR, VTA; Bulldog is involved with NDP. Vulnerable are ADX, RGT, FUND. But a bill in CONGRESS may restrict activist activities by (1) limiting activists to 10% ownership of CEFs (but they may join hands with other activists), (2) allowing CEFs to invest more than 15% in illiquid private funds (venture-capital, private-equity) and that would make quick tender offers or liquidations difficult. Even now, the hedge funds are limited to owning 3% of CEFs, but they get around this restriction by owning CEFs through affiliated entities. STATES also have securities laws that make it difficult for hedge funds to takeover CEFs. It would be interesting to see how all this plays out among the fund industry (and ICI), activists, the SEC, states and Congress.
Pg 19: 100 YEARS OF BARRON’S reviews the history of RESTAURANT industry and factors affecting it – modern kitchen equipment, franchises, driving culture, drive-in features, coin-operated music, notions of fast-food, casual and fast-casual dining, variety of ethnic foods, etc.
Pg 27: FUNDS. Matthew MOBERG of large-cap growth FKDNX (ER 0/85% for class A; no-load/NTF at Fidelity and Schwab) looks for innovative companies with high earnings growth and their trailing P/Es may be high.
Pg 29: CHINA’s crackdown on big techs, private education industry and the US-listed Chinese companies has investors scrambling. It seems that Chinese government and regulators can pick any target and cause havoc without considering implications for investors. Avoid individual companies and use ETFs (MCHI, A-shares ASHS, energy CHIE, utilities CHIU, materials CHIM) and active funds (FHKCX, OBCHX, MCSMX).
Pg 30: TECH TRADER. Big tech big earnings came and went, and investors were unimpressed. The pandemic boom may be over even with Covid-19-Delta gaining strength. Spending patterns are shifting from online to physical purchases (travel, restaurants, events, etc). Component shortage are widespread. Digital transformation is continuing, and cloud business is strong. Regulatory threats to big techs remain.
Pg 31: INCOME. PINDER (UBS) has a model to identify high dividend-growth stocks: MS, GS, BC, RJF, PHM, SWKS, DE, LEN, etc.
Stocks with high potential for dividend restoration include MAR, WFC, etc.
Pg 32: Richard PARSONS, former Chairman of Citigroup/C, former CEO of Time Warner, former Chairman of CBS. Now on several corporate boards (LAZ, EL, MSGS) and blockchain related Celo Foundation (Celo is a phone-based payment platform). Surprisingly, media content and distribution don’t create synergies. Digital trends are accelerating – streaming, etc. Cable will be around, but cable TV bundles may disappear. Theaters are also not going away as people enjoy the big screen and theater experience. There is room for 2 or more big players in every media area, but smaller players will also linger. Digital transformation is coming to financial services via cryptos. Issues with minorities and underserved communities cannot be addressed overnight. Sustained efforts are needed to promote education, entrepreneurship and opportunities.
Pg 34. OTHER VOICES. Gina RAIMONDO, US Secretary of Commerce. America’s CARE-economy (involving kids, aging parents, care workers) is in crisis. Unavailable or unaffordable care can impact return-to-work plans and economic recovery; care was expensive even before Covid-19. 7.5 million UNEMPLOYED workers cite childcare issues and 1.9 million unemployed cite eldercare issues. The SANDWICH-generation is caught between job and caregiving demands. WOMEN are more impacted – almost 2 million women have left the workforce since February 2020 and women’s workforce participation is now the lowest in 30 years. INVESTMENTS are needed to make care affordable, care-worker training, new care facilities, flexible work environment and policies. Every $1 invested in childcare and early education can return $8.60 in societal benefits. CONGRESS needs to pass some related laws.
(EXTRAS from online Friday that didn’t make the weekend paper version)
FOLLOWUP. CRASH in Chinese stocks/ADRs listed (only) in the US has made investors aware of their hidden risks from the US and Chinese regulators. Their VIE structure is under scrutiny both from the US and China (and those seem to be feeding on each other) and the fear now is that the VIE may be declared fraudulent. Some affected companies have dual-listed in HK or China Mainland, but others may be forced to go private (as they may be unable to meet new US and/or Chinese rules). Both the US and China have now put restrictions on any such new IPOs. The ETF PGJ that is based on the US-listed Chinese stocks is down -44% since mid-February. Chinese education stocks TAL, EDU are down -90% and DIDI crashed soon after its US IPO – on adverse Chinese actions/reactions. More cooperating Jack MA of BABA is laying low after the Ant IPO was forcibly scrapped. Chinese big techs now trade like value stocks (BABA fwd P/E 18) compared to their US or global counterparts. Investors would be wise to access Chinese stocks (listed anywhere) via mutual funds and ETFs.
FUNDS. Robinhood/HOOD had a dismal IPO, but Cathie WOOD (Ark Investment) bought it for ARKK.
LINK