Month: August 2020

(Bloomberg) — Tech behemoths have been Wall Street’s obsession all year. But the tiniest of stocks have surreptitiously been making a comeback — in a big way.The Russell Microcap Index, whose members have a value of $300 million on average, is up more than 60% from this year’s stock-market lows, outperforming both the tech-heavy Nasdaq 100 and the S&P 500. The tiny-stock gauge is having its best month relative to the U.S. equity benchmark since September 2017.“The good-looking big boys and girls have been touted as the only game in town this year. These large, domestic, safe, easily recognized, fast-growing, …read more […]

Bernstein expects Apple’s services segment to generate double-digit revenue growth for at least 2 to 3 years as other parts of the tech giant’s business may grow at a slower pace.Nonetheless, Bernstein analyst Toni Sacconaghi reiterated a Hold rating on Apple (AAPL) with a price target of $400 (13% downside potential) .”While we see many of Apple’s existing businesses (e.g. App Store, iCloud, and Apple Music) decelerating to high single digit growth as incremental penetration/increased ARPU [average revenue per user] becomes more challenging, we believe there is significant runway (to $7-12B in annual revenues) from Apple’s new services, which could …read more […]

Alibaba’s fintech arm Ant Group has started the process to dual list in Shanghai and Hong Kong.The group, China’s biggest mobile payments company, has now made a preparatory filing with China’s securities regulator, according to a report from Reuters.Meanwhile China’s Caixin states that Ant Group is hoping to sell 10% of its shares on Shanghai’s Nasdaq-like STAR board and 5% on the Hong Kong Stock Exchange.BABA currently owns 33% of Ant, while Alibaba (BABA) co-founder and former executive chairman Jack Ma owns 8.8%, but with over 50% of voting power.According to Reuters, Ant is seeking a valuation of over $200B …read more […]

Billionaire Warren Buffett’s investment conglomerate Berkshire Hathaway built up a new position in Toronto-based miner Barrick Gold and continued to divest shares in a number of large US banks during the second quarter.According to a SEC filing released late on Friday, Berkshire (BRK.A) bought 20.9 million shares in Barrick Gold worth about $563.6 million. Following the disclosure, the stock surged 8.1% to $29.18 in after-market trading.Barrick shares (GOLD) have been on a steady gaining streak since mid-March appreciating some 45% this year, as surging gold prices have driven stock prices of gold miners to multi-year highs. This comes as the …read more […]

Barclays reduced the price target on Micron Technology but maintained a Buy rating on the stock. Shares in the chipmaker declined 1.2% on Friday.Barclays analyst Blayne Curtis lowered Micron’s (MU) price target to $55 (20.6% upside potential) from $60, after the company warned that it could miss 1Q revenue guidance. The new PT reflects “near-term softness after the company indicated they are seeing a softer demand environment in the Enterprise channel as well as some impact from later qualifications of their 1Z products, which add up to make their August-end quarter revenue much more back-end loaded than anticipated.”In addition, UBS …read more […]

Chinese tech giant Baidu (BIDU) has announced that it has now taken its 2020 Share Repurchase Program from $1 billion to $3 billion, effective through December 31, 2022.During the second quarter Baidu returned $540 million to shareholders, bringing its cumulative repurchase for the last two years to approximately $1.9 billion.The announcement came as part of the company’s second quarter earning results, which saw the stock crater 6% in Friday’s trading. News of an SEC investigation into Baidu-owned online streaming provider iQIYI (IQ) also weighed on shares.Baidu reported overall revenues RMB 26.03B, down 1% year-over-year but up 15% from the previous …read more […]

Merrill Lynch upgraded Tesla to Hold from Sell citing the company’s “unlimited” access to low-cost capital. Merrill Lynch analyst John Murphy also ramped up the stocks’s price target to $1,750 (6% upside potential) from $800.In a note to investors, Murphy said: “While we remain skeptical that TSLA (TSLA) will be the dominant EV automaker in the long-run, if a big global footprint can be built with no-cost capital, the ‘growth’ story would carry the day for the stock.” The analyst also added that Tesla’s unlimited access to low-cost capital should “accelerate its revenue growth rate to 50% annually over the …read more […]

The Bureau of Land Management has approved ConocoPhillips’ (COP) proposed Willow Master Development Plan (MDP) for drilling in Alaska’s National Petroleum Reserve.According to the bureau’s final environmental impact statement (EIS), the Willow MDP Project could produce in excess of 160,000 barrels of oil per day (with a processing capacity of 200,000 barrels of oil per day) over its anticipated 30-year life, producing up to approximately 590 million total barrels of oil.More than 1,000 jobs are expected during peak construction with more than 400 jobs during operations- which will help offset declines in production from the North Slope oil fields and …read more […]

Lockheed Martin (LMT) has been awarded a $62 billion ten-year, indefinite-delivery/indefinite-quantity (IDIQ), fixed-price-incentive contract for new production of F-16 Foreign Military Sale (FMS) aircraft.The total value for the initial delivery order is $4,941,105,246 and will be awarded on the same date, the US Department of Defense wrote on August 14.According to the statement, the initial delivery order is for 90 aircraft, including both the pre-priced recurring core configuration costs at $2,862,797,674 and the engineering change proposal/ undefinitized contract action for the non-recurring costs not-to-exceed $2,078,307,572 obligated at approximately $1,018,370,710.Work will be primarily performed in Greenville, South Carolina; and Fort Worth, …read more […]

After Labor Day, volatility should pick up again especially if the VIX falls over the next three weeks. This will be our complacency indicator. …read more […]

DraftKings (DKNG) is in the spotlight following an internal IRS memo suggesting that daily fantasy sports (DFS) operators will have to pay tax on their entry fees.An IRS Chief Counsel Memorandum determined that DFS entry fees are taxable wagers, writing: “A DFS entry fee is a wager of money by the participant with respect to a sports event or contest placed with a person engaged in the business of accepting such wagers.”It also stated that if a DFS operator is liable to pay excise taxes on wagers, then each DFS operator is liable to pay the occupational excise tax and …read more […]

Gold bulls are still nursing their wounds after the precious metal suffered its worst decline since March. …read more […]

(Bloomberg) — A growing number of amateur stock traders in China are making their biggest decisions in the dead of night.It was 4 a.m. when Li Bohao, a 23-year-old Beijing native, got a panicked call from a friend telling him to sell all his shares of Nio Inc., the U.S.-listed Chinese electric-car company dubbed the “Tesla of China.” The stock was on the slide and analysts were speculating it could soon be worthless. Li took the advice — and missed out. Nio’s shares are now worth over four times more than when he sold in March. The comic animation entrepreneur, …read more […]

U.S. President Donald Trump said on Saturday he could exert pressure on more Chinese companies such as technology giant Alibaba after he moved to ban TikTok. Asked at a news conference whether there were other particular China-owned companies he was considering a ban on, such as Alibaba, Trump replied: “Well, we’re looking at other things, yes.” Trump has been piling pressure on Chinese-owned companies, such as by vowing to ban short-video app TikTok from the United States. …read more […]

* This weekend’s Barron’s suggests ways to play U.S.-China tensions and the stock-splitting trend. * Other featured articles look at how the election could affect health care stocks and what to expect from big-box retail earnings. * Also, the prospects for a pharmaceutical giant, regional bank dividends, pet stocks and more.How to Profit From the U.S.-China Cold War” by Reshma Kapadia explains why investors should watch for certain risks and opportunities in the escalating tensions between the United States and China. Does Barron’s believe Nike Inc (NYSE: NKE) is a play?Al Root’s “How to Play Stock-Split Mania” points …read more […]