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A Closer Look At Distil plc's (LON:DIS) Uninspiring ROE Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. To keep the lesson grounded in practicality, we'll use ROE to better understand Distil plc (LON:DIS). Over the last twelve monthsDistil has recorded a ROE of 5.0%. Another way to think of that is that for every £1 worth of equity in the company, it was able to earn £0.050. See our latest analysis for Distil Theformula for return on equityis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Distil: 5.0% = UK£160k ÷ UK£3.2m (Based on the trailing twelve months to March 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is the capital paid in by shareholders, plus any retained earnings. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets. ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies. Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As is clear from the image below, Distil has a lower ROE than the average (20%) in the Beverage industry. Unfortunately, that's sub-optimal. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Nonetheless, it could be useful todouble-check if insiders have sold shares recently. Most companies need money -- from somewhere -- to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Shareholders will be pleased to learn that Distil has not one iota of net debt! Although I don't find its ROE that impressive, it's worth remembering it achieved these returns without debt. At the end of the day, when a company has zero debt, it is in a better position to take future growth opportunities. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So you might want to check this FREEvisualization of analyst forecasts for the company. Of courseDistil may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
These Fundamentals Make Destiny Media Technologies Inc. (FRA:DME) Truly Worth Looking At Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Destiny Media Technologies Inc. (FRA:DME) is a company with exceptional fundamental characteristics. Upon building up an investment case for a stock, we should look at various aspects. In the case of DME, it is a financially-robust company with a great track record of performance, trading at a discount. Below is a brief commentary on these key aspects. For those interested in digger a bit deeper into my commentary, take a look at thereport on Destiny Media Technologies here. DME delivered a satisfying double-digit returns of 23% in the most recent year. Unsurprisingly, DME surpassed the Interactive Media and Services industry return of 27%, which gives us more confidence of the company's capacity to drive earnings going forward. DME is financially robust, with ample cash on hand and short-term investments to meet upcoming liabilities. This indicates that DME has sufficient cash flows and proper cash management in place, which is a key determinant of the company’s health. Investors should not worry about DME’s debt levels because the company has none! This implies that the company is running its operations purely on off equity funding. which is typically normal for a small-cap company. DME has plenty of financial flexibility, without debt obligations to meet in the short term, as well as the headroom to raise debt should it need to in the future. DME's share price is trading at below its true value, meaning that the market sentiment for the stock is currently bearish. Investors have the opportunity to buy into the stock to reap capital gains, if DME's projected earnings trajectory does follow analyst consensus growth, which determines my intrinsic value of the company. Compared to the rest of the interactive media and services industry, DME is also trading below its peers, relative to earnings generated. This bolsters the proposition that DME's price is currently discounted. For Destiny Media Technologies, I've put together three fundamental factors you should further research: 1. Future Outlook: What are well-informed industry analysts predicting for DME’s future growth? Take a look at ourfree research report of analyst consensusfor DME’s outlook. 2. Dividend Income vs Capital Gains: Does DME return gains to shareholders through reinvesting in itself and growing earnings, or redistribute a decent portion of earnings as dividends? Ourhistorical dividend yield visualizationquickly tells you what your can expect from DME as an investment. 3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of DME? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Does Temenos AG's (VTX:TEMN) Share Price Indicate? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Let's talk about the popular Temenos AG (VTX:TEMN). The company's shares saw a significant share price rise of over 20% in the past couple of months on the SWX. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, could the stock still be trading at a relatively cheap price? Today I will analyse the most recent data on Temenos’s outlook and valuation to see if the opportunity still exists. Check out our latest analysis for Temenos According to my relative valuation model, the stock is currently overvalued. In this instance, I’ve used the price-to-earnings (PE) ratio given that there is not enough information to reliably forecast the stock’s cash flows. I find that Temenos’s ratio of 70.24x is above its peer average of 28.83x, which suggests the stock is overvalued compared to the Software industry. But, is there another opportunity to buy low in the future? Given that Temenos’s share is fairly volatile (i.e. its price movements are magnified relative to the rest of the market) this could mean the price can sink lower, giving us another chance to buy in the future. This is based on its high beta, which is a good indicator for share price volatility. Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Temenos’s earnings over the next few years are expected to increase by 80%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value. Are you a shareholder?It seems like the market has well and truly priced in TEMN’s positive outlook, with shares trading above its fair value. At this current price, shareholders may be asking a different question – should I sell? If you believe TEMN should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed. Are you a potential investor?If you’ve been keeping an eye on TEMN for a while, now may not be the best time to enter into the stock. The price has surpassed its industry peers, which means it is likely that there is no more upside from mispricing. However, the optimistic prospect is encouraging for TEMN, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop. Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Temenos. You can find everything you need to know about Temenos inthe latest infographic research report. If you are no longer interested in Temenos, you can use our free platform to see my list of over50 other stocks with a high growth potential. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Did DNO ASA (OB:DNO) Insiders Buy Up More Shares? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we'll take a look at whether insiders have been buying or selling shares inDNO ASA(OB:DNO). It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information. Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.' See our latest analysis for DNO While no particular insider transaction stood out, we can still look at the overall trading. Happily, we note that in the last year insiders bought 13000 shares for a total of øre232k. In the last twelve months DNO insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction! There are plenty of other companies that have insiders buying up shares. You probably donotwant to miss thisfreelist of growing companies that insiders are buying. There was some insider buying at DNO over the last quarter. Deputy Managing Director Christopher Spencer shelled out US$51k for shares in that time. It's good to see the insider buying, as well as the lack of recent sellers. However, in this case the amount invested recently is quite small. I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From what we can see in our data, insiders own only about øre5.4m worth of DNO shares. We might be missing something but that seems like very low insider ownership. The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on DNO stock. Of course,the future is what matters most. So if you are interested in DNO, you should check out thisfreereport on analyst forecasts for the company. Of courseDNO may not be the best stock to buy. So you may wish to see thisfreecollection of high quality companies. For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Why Terna Energy Societe Anonyme Commercial Technical Company (ATH:TENERGY) Looks Like A Quality Company Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Terna Energy Societe Anonyme Commercial Technical Company (ATH:TENERGY). Our data showsTerna Energy Societe Anonyme Commercial Technical has a return on equity of 14%for the last year. One way to conceptualize this, is that for each €1 of shareholders' equity it has, the company made €0.14 in profit. See our latest analysis for Terna Energy Societe Anonyme Commercial Technical Theformula for return on equityis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Terna Energy Societe Anonyme Commercial Technical: 14% = €56m ÷ €417m (Based on the trailing twelve months to March 2019.) It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all earnings retained by the company, plus any capital paid in by shareholders. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets. Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the profit over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal,investors should like a high ROE. That means it can be interesting to compare the ROE of different companies. By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As is clear from the image below, Terna Energy Societe Anonyme Commercial Technical has a better ROE than the average (5.7%) in the Renewable Energy industry. That's clearly a positive. I usually take a closer look when a company has a better ROE than industry peers. For example,I often check if insiders have been buying shares. Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. Terna Energy Societe Anonyme Commercial Technical does use a significant amount of debt to increase returns. It has a debt to equity ratio of 2.05. There's no doubt the ROE is respectable, but it's worth keeping in mind that metric is elevated by the use of debt. Debt increases risk and reduces options for the company in the future, so you generally want to see some good returns from using it. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. In my book the highest quality companies have high return on equity, despite low debt. All else being equal, a higher ROE is better. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company. Of courseTerna Energy Societe Anonyme Commercial Technical may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Now The Time To Put Urban Logistics REIT (LON:SHED) On Your Watchlist? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling short, can easily find investors. But as Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.' So if you're like me, you might be more interested in profitable, growing companies, likeUrban Logistics REIT(LON:SHED). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed. Check out our latest analysis for Urban Logistics REIT In the last three years Urban Logistics REIT's earnings per share took off like a rocket; fast, and from a low base. So the actual rate of growth doesn't tell us much. Thus, it makes sense to focus on more recent growth rates, instead. It's good to see that Urban Logistics REIT's EPS have grown from UK£0.20 to UK£0.22 over twelve months. That's a 13% gain; respectable growth in the broader scheme of things. One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. The good news is that Urban Logistics REIT is growing revenues, and EBIT margins improved by 14.2 percentage points to 75%, over the last year. That's great to see, on both counts. The chart below shows how the company's bottom and top lines have progressed over time. Click on the chart to see the exact numbers. Since Urban Logistics REIT is no giant, with a market capitalization of UK£112m, so you shoulddefinitely check its cash and debtbeforegetting too excited about its prospects. Like that fresh smell in the air when the rains are coming, insider buying fills me with optimistic anticipation. Because oftentimes, the purchase of stock is a sign that the buyer views it as undervalued. Of course, we can never be sure what insiders are thinking, we can only judge their actions. The good news for Urban Logistics REIT shareholders is that no insiders reported selling shares in the last year. So it's definitely nice that Non-Executive Director Bruce Anderson bought UK£10k worth of shares at an average price of around UK£1.22. One important encouraging feature of Urban Logistics REIT is that it is growing profits. Not every business can grow its EPS, but Urban Logistics REIT certainly can. The icing on the cake is that an insider bought shares during the year, which inclines me to put this one on a watchlist. While we've looked at the quality of the earnings, we haven't yet done any work to value the stock. So if you like to buy cheap, you may want tocheck if Urban Logistics REIT is trading on a high P/E or a low P/E, relative to its industry. The good news is that Urban Logistics REIT is not the only growth stock with insider buying. Here'sa list of them... with insider buying in the last three months! Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Evotec Completes Acquisition Of Just Biotherapeutics • ACQUISITION EXTENDS EVOTEC'S MULTIMODALITY OFFERING, WITH INTEGRATED SOLUTIONS FOR SMALL MOLECULES AND BIOLOGICS • EXPANDS EVOTEC'S US FOOTPRINT IN SEATTLE AND MACHINE LEARNING CAPABILITIES • DEAL VALUE OF $ 90 M INCLUDING POTENTIAL EARN-OUTS HAMBURG, GERMANY / ACCESSWIRE / July 3, 2019 /Evotec SE (Frankfurt Stock Exchange: EVT, TecDAX, ISIN: DE0005664809) today announced that the strategic transaction to acquire Just Biotherapeutics ("Just.Bio"), signed on 20 May 2019, has been completed. The acquisition accelerates Evotec's long-term strategy to be the industry partner of choice for external end-to-end innovation, strengthening Evotec's multimodality approach to R&D. Evotec acquired Just.Bio to integrate their cutting-edge machine-learning technologies and agile, flexible methods for the design, development, and manufacturing of biologics into Evotec's drug discovery offerings. Just.Bio's approx. 95 employees and its state-of-the-art biologic development and manufacturing site located in Seattle, WA, USA, will expand Evotec's US footprint. Just.Bio's capabilities and expertise comprise an in-house,integrated technologyplatform, J.DESIGN, enabling smart and efficient biologics' drug development from design and lead optimisation to manufacturing: • J.MD(TM)is a technology-based process development tool using Abacus(TM), a machine learning-based computer-aided design tool, to predict and select optimal molecules for further development • JP3(R)includes lab and computational tools for rapid development of a high-yielding manufacturing process along with a cGMP early clinical manufacturing facility • Significant further potential lies in the company's J.POD(R)technology for flexible and modular, larger scale manufacturing of clinical and commercial-stage biologics Transaction structure summary In less than four years, Just.Bio has been able to build their J.DESIGN platform and attract a diversified customer portfolio resulting in strong financial growth with reported 2018 revenues of approx. $ 20 m. Evotec will pay a total consideration of up to $ 90 m including potential earn outs in the next three years. The initial consideration upon closing is $ 60 m subject to customary net debt and working capital adjustments. The acquisition of 100% of the issued and outstanding equity interests of the company will be paid in cash to a syndicate of institutional investors of ARCH Venture Partners, Merck & Co., Lilly Asia Ventures and the Bill & Melinda Gates Foundation. The acquisition will add to Evotec's revenue growth and will strengthen Evotec's overall strategic vision. A guidance update will be given upon reporting of half-year 2019 figures. Just.Bio will be financially fully consolidated under the Evotec Group. Dr Werner Lanthaler, Chief Executive Officer of Evotec, said:"We are pleased to have been able to swiftly close the acquisition of Just.Bio. With the integration of Just.Bio's expertise in biologics and their outstanding human talent, we will accelerate our ability to build better molecules with cutting-edge technologies for our customers as well as our own pipeline. We warmly welcome the Just.Bio employees to the Evotec Group." Dr James Thomas, EVP, Global Head, Biotherapeutics, President US Operations of Evotec, commented:"Starting with a small group of creative and passionate employees, we've made remarkably fast progress building a state-of-the-art technology platform for expanding global access to biologics. Joining forces with Evotec will build upon these accomplishments and accelerate expansion of our advanced capabilities in Seattle, a growing hub of technology innovation. We are thrilled to be part of the excellent Evotec global team." ABOUT EVOTEC SE Evotec is adrug discoveryalliance and development partnership company focused on rapidly progressing innovative product approaches with leading pharmaceutical and biotechnology companies, academics, patient advocacy groups and venture capitalists. We operate worldwide and our more than 2,800 employees provide the highest qualitystand-alone and integrated drug discovery and development solutions. We cover all activities from target-to-clinic to meet the industry's need for innovation and efficiency in drug discovery and development (EVT Execute). The Company has established a unique position by assembling top-class scientific experts and integrating state-of-the-art technologies as well as substantial experience and expertise in key therapeutic areas including neuronal diseases, diabetes and complications of diabetes, pain and inflammation, oncology, infectious diseases, respiratory diseases and fibrosis. On this basis, Evotec has built a broad and deep pipeline of approx. 100 co-owned product opportunities at clinical, pre-clinical and discovery stages (EVT Innovate). Evotec has established multiple long-term alliances with partners including, Bayer, Boehringer Ingelheim, Celgene, CHDI, Novartis, Novo Nordisk, Pfizer, Sanofi, Takeda, UCB and others. For additional information please go towww.evotec.comand follow us on Twitter@Evotec. FORWARD LOOKING STATEMENTS Information set forth in this press release contains forward-looking statements, which involve a number of risks and uncertainties. The forward-looking statements contained herein represent the judgement of Evotec as of the date of this press release. Such forward-looking statements are neither promises nor guarantees, but are subject to a variety of risks and uncertainties, many of which are beyond our control, and which could cause actual results to differ materially from those contemplated in these forward-looking statements. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any such statements to reflect any change in our expectations or any change in events, conditions or circumstances on which any such statement is based. Contact Evotec SE: Gabriele Hansen, VP Corporate Communications, Marketing & Investor Relations, Phone: +49.(0)40.56081-255,[email protected] SOURCE:Evotec AG View source version on accesswire.com:https://www.accesswire.com/550722/Evotec-Completes-Acquisition-Of-Just-Biotherapeutics
SGS SA (VTX:SGSN) Is Employing Capital Very Effectively Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we are going to look at SGS SA (VTX:SGSN) to see whether it might be an attractive investment prospect. To be precise, we'll consider its Return On Capital Employed (ROCE), as that will inform our view of the quality of the business. First up, we'll look at what ROCE is and how we calculate it. Then we'll compare its ROCE to similar companies. And finally, we'll look at how its current liabilities are impacting its ROCE. ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business. In general, businesses with a higher ROCE are usually better quality. Overall, it is a valuable metric that has its flaws. Author Edwin Whitingsaysto be careful when comparing the ROCE of different businesses, since 'No two businesses are exactly alike.' The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for SGS: 0.23 = CHF946m ÷ (CHF6.1b - CHF2.0b) (Based on the trailing twelve months to December 2018.) Therefore,SGS has an ROCE of 23%. View our latest analysis for SGS ROCE can be useful when making comparisons, such as between similar companies. In our analysis, SGS's ROCE is meaningfully higher than the 15% average in the Professional Services industry. I think that's good to see, since it implies the company is better than other companies at making the most of its capital. Putting aside its position relative to its industry for now, in absolute terms, SGS's ROCE is currently very good. You can see in the image below how SGS's ROCE compares to its industry. Click to see more on past growth. When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. ROCE can be misleading for companies in cyclical industries, with returns looking impressive during the boom times, but very weak during the busts. ROCE is, after all, simply a snap shot of a single year. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company. Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. Due to the way the ROCE equation works, having large bills due in the near term can make it look as though a company has less capital employed, and thus a higher ROCE than usual. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets. SGS has total assets of CHF6.1b and current liabilities of CHF2.0b. As a result, its current liabilities are equal to approximately 33% of its total assets. SGS has a medium level of current liabilities, boosting its ROCE somewhat. Despite this, it reports a high ROCE, and may be worth investigating further. SGS looks strong on this analysis,but there are plenty of other companies that could be a good opportunity. Here is afree listof companies growing earnings rapidly. I will like SGS better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Here's Why I Think Cpl Resources (ISE:DQ5) Might Deserve Your Attention Today Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it completely lacks a track record of revenue and profit. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. So if you're like me, you might be more interested in profitable, growing companies, likeCpl Resources(ISE:DQ5). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. While a well funded company may sustain losses for years, unless its owners have an endless appetite for subsidizing the customer, it will need to generate a profit eventually, or else breathe its last breath. View our latest analysis for Cpl Resources If a company can keep growing earnings per share (EPS) long enough, its share price will eventually follow. Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. We can see that in the last three years Cpl Resources grew its EPS by 14% per year. That's a pretty good rate, if the company can sustain it. One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. Cpl Resources maintained stable EBIT margins over the last year, all while growing revenue 13% to €545m. That's a real positive. The chart below shows how the company's bottom and top lines have progressed over time. Click on the chart to see the exact numbers. Since Cpl Resources is no giant, with a market capitalization of €181m, so you shoulddefinitely check its cash and debtbeforegetting too excited about its prospects. Many consider high insider ownership to be a strong sign of alignment between the leaders of a company and the ordinary shareholders. So we're pleased to report that Cpl Resources insiders own a meaningful share of the business. In fact, they own 36% of the shares, making insiders a very influential shareholder group. I'm always comforted by solid insider ownership like this, as it implies that those running the business are genuinely motivated to create shareholder value. In terms of absolute value, insiders have €66m invested in the business, using the current share price. That's nothing to sneeze at! It means a lot to see insiders invested in the business, but I find myself wondering if remuneration policies are shareholder friendly. A brief analysis of the CEO compensation suggests they are. I discovered that the median total compensation for the CEOs of companies like Cpl Resources with market caps between €89m and €354m is about €603k. Cpl Resources offered total compensation worth €458k to its CEO in the year to June 2018. That comes in below the average for similar sized companies, and seems pretty reasonable to me. CEO remuneration levels are not the most important metric for investors, but when the pay is modest, that does support enhanced alignment between the CEO and the ordinary shareholders. It can also be a sign of good governance, more generally. One important encouraging feature of Cpl Resources is that it is growing profits. The fact that EPS is growing is a genuine positive for Cpl Resources, but the pretty picture gets better than that. Boasting both modest CEO pay and considerable insider ownership, I'd argue this one is worthy of the watchlist, at least. Of course, just because Cpl Resources is growing does not mean it is undervalued. If you're wondering about the valuation, check outthis gauge of its price-to-earnings ratio, as compared to its industry. Although Cpl Resources certainly looks good to me, I would like it more if insiders were buying up shares. If you like to see insider buying, too, then thisfreelist of growing companies that insiders are buying, could be exactly what you're looking for. Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Auto Trader Group (LON:AUTO) Shareholders Have Enjoyed A 71% Share Price Gain Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Auto Trader Group plc(LON:AUTO) shareholders might be concerned after seeing the share price drop 10% in the last month. But don't let that distract from the very nice return generated over three years. After all, the share price is up a market-beating 71% in that time. Check out our latest analysis for Auto Trader Group To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. Auto Trader Group was able to grow its EPS at 18% per year over three years, sending the share price higher. We don't think it is entirely coincidental that the EPS growth is reasonably close to the 20% average annual increase in the share price. This suggests that sentiment and expectations have not changed drastically. Rather, the share price has approximately tracked EPS growth. The image below shows how EPS has tracked over time (if you click on the image you can see greater detail). We know that Auto Trader Group has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Auto Trader Group willgrow revenue in the future. As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Auto Trader Group's TSR for the last 3 years was 77%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted thetotalshareholder return. Pleasingly, Auto Trader Group's total shareholder return last year was 29%. That's including the dividend. So this year's TSR was actually better than the three-year TSR (annualized) of 21%. The improving returns to shareholders suggests the stock is becoming more popular with time. Most investors take the time to check the data on insider transactions. You canclick here to see if insiders have been buying or selling. We will like Auto Trader Group better if we see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Does Dassault Systèmes SE’s (EPA:DSY) 13% ROCE Say About The Business? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we'll evaluate Dassault Systèmes SE (EPA:DSY) to determine whether it could have potential as an investment idea. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires. First of all, we'll work out how to calculate ROCE. Then we'll compare its ROCE to similar companies. And finally, we'll look at how its current liabilities are impacting its ROCE. ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business. In general, businesses with a higher ROCE are usually better quality. In brief, it is a useful tool, but it is not without drawbacks. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'. Analysts use this formula to calculate return on capital employed: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Dassault Systèmes: 0.13 = €840m ÷ (€8.7b - €2.1b) (Based on the trailing twelve months to March 2019.) So,Dassault Systèmes has an ROCE of 13%. See our latest analysis for Dassault Systèmes When making comparisons between similar businesses, investors may find ROCE useful. It appears that Dassault Systèmes's ROCE is fairly close to the Software industry average of 12%. Separate from Dassault Systèmes's performance relative to its industry, its ROCE in absolute terms looks satisfactory, and it may be worth researching in more depth. You can click on the image below to see (in greater detail) how Dassault Systèmes's past growth compares to other companies. Remember that this metric is backwards looking - it shows what has happened in the past, and does not accurately predict the future. Companies in cyclical industries can be difficult to understand using ROCE, as returns typically look high during boom times, and low during busts. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Since the future is so important for investors, you should check out ourfreereport on analyst forecasts for Dassault Systèmes. Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To counter this, investors can check if a company has high current liabilities relative to total assets. Dassault Systèmes has total assets of €8.7b and current liabilities of €2.1b. As a result, its current liabilities are equal to approximately 24% of its total assets. A fairly low level of current liabilities is not influencing the ROCE too much. Overall, Dassault Systèmes has a decent ROCE and could be worthy of further research. Dassault Systèmes looks strong on this analysis,but there are plenty of other companies that could be a good opportunity. Here is afree listof companies growing earnings rapidly. If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Treatt plc's (LON:TET) High P/E Ratio A Problem For Investors? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Treatt plc's (LON:TET), to help you decide if the stock is worth further research.Treatt has a price to earnings ratio of 28.72, based on the last twelve months. In other words, at today's prices, investors are paying £28.72 for every £1 in prior year profit. View our latest analysis for Treatt Theformula for P/Eis: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Treatt: P/E of 28.72 = £4.61 ÷ £0.16 (Based on the trailing twelve months to March 2019.) The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.' P/E ratios primarily reflect market expectations around earnings growth rates. That's because companies that grow earnings per share quickly will rapidly increase the 'E' in the equation. And in that case, the P/E ratio itself will drop rather quickly. Then, a lower P/E should attract more buyers, pushing the share price up. Treatt shrunk earnings per share by 11% over the last year. But EPS is up 17% over the last 5 years. We can get an indication of market expectations by looking at the P/E ratio. The image below shows that Treatt has a higher P/E than the average (26.5) P/E for companies in the chemicals industry. Treatt's P/E tells us that market participants think the company will perform better than its industry peers, going forward. Shareholders are clearly optimistic, but the future is always uncertain. So further research is always essential. I often monitordirector buying and selling. The 'Price' in P/E reflects the market capitalization of the company. So it won't reflect the advantage of cash, or disadvantage of debt. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth. Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof). Since Treatt holds net cash of UK£9.4m, it can spend on growth, justifying a higher P/E ratio than otherwise. Treatt trades on a P/E ratio of 28.7, which is above the GB market average of 16.3. The recent drop in earnings per share would make some investors cautious, but the relatively strong balance sheet will allow the company time to invest in growth. Clearly, the high P/E indicates shareholders think it will! Investors should be looking to buy stocks that the market is wrong about. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' So thisfreevisualization of the analyst consensus on future earningscould help you make theright decisionabout whether to buy, sell, or hold. Of courseyou might be able to find a better stock than Treatt. So you may wish to see thisfreecollection of other companies that have grown earnings strongly. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is ECO Animal Health Group plc (LON:EAH) A Smart Pick For Income Investors? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Is ECO Animal Health Group plc (LON:EAH) a good dividend stock? How can we tell? Dividend paying companies with growing earnings can be highly rewarding in the long term. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments. While ECO Animal Health Group's 2.8% dividend yield is not the highest, we think its lengthy payment history is quite interesting. Some simple research can reduce the risk of buying ECO Animal Health Group for its dividend - read on to learn more. Explore this interactive chart for our latest analysis on ECO Animal Health Group! Companies (usually) pay dividends out of their earnings. If a company is paying more than it earns, the dividend might have to be cut. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Looking at the data, we can see that 63% of ECO Animal Health Group's profits were paid out as dividends in the last 12 months. A payout ratio above 50% generally implies a business is reaching maturity, although it is still possible to reinvest in the business or increase the dividend over time. We also measure dividends paid against a company's levered free cash flow, to see if enough cash was generated to cover the dividend. ECO Animal Health Group paid out 280% of its free cash flow last year, which we think is concerning if cash flows do not improve. Paying out more than 100% of your free cash flow in dividends is generally not a long-term, sustainable state of affairs, so we think shareholders should watch this metric closely. While ECO Animal Health Group's dividends were covered by the company's reported profits, free cash flow is somewhat more important, so it's not great to see that the company didn't generate enough cash to pay its dividend. Were it to repeatedly pay dividends that were not well covered by cash flow, this could be a risk to ECO Animal Health Group's ability to maintain its dividend. We update our data on ECO Animal Health Group every 24 hours, so you can always getour latest analysis of its financial health, here. From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. ECO Animal Health Group has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. During the past ten-year period, the first annual payment was UK£0.071 in 2009, compared to UK£0.11 last year. Dividends per share have grown at approximately 4.4% per year over this time. Modest growth in the dividend is good to see, but we think this is offset by historical cuts to the payments. It is hard to live on a dividend income if the company's earnings are not consistent. Examining whether the dividend is affordable and stable is important. However, it's also important to assess if earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see ECO Animal Health Group has grown its earnings per share at 32% per annum over the past five years. With recent, rapid earnings per share growth and a payout ratio of 63%, this business looks like an interesting prospect if earnings are reinvested effectively. We'd also point out that ECO Animal Health Group issued a meaningful number of new shares in the past year. Trying to grow the dividend when issuing new shares reminds us of the ancient Greek tale of Sisyphus - perpetually pushing a boulder uphill. Companies that consistently issue new shares are often suboptimal from a dividend perspective. When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. ECO Animal Health Group gets a pass on its dividend payout ratio, but it paid out virtually all of its cash flow as dividends. This may just be a one-off, but we'd keep an eye on this. Next, earnings growth has been good, but unfortunately the dividend has been cut at least once in the past. While we're not hugely bearish on it, overall we think there are potentially better dividend stocks than ECO Animal Health Group out there. You can also discover whether shareholders are aligned with insider interests bychecking our visualisation of insider shareholdings and trades in ECO Animal Health Group stock. If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Does Aperam S.A.'s (AMS:APAM) P/E Ratio Signal A Buying Opportunity? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today, we'll introduce the concept of the P/E ratio for those who are learning about investing. To keep it practical, we'll show how Aperam S.A.'s (AMS:APAM) P/E ratio could help you assess the value on offer. Based on the last twelve months,Aperam's P/E ratio is 9.13. That corresponds to an earnings yield of approximately 11%. Check out our latest analysis for Aperam Theformula for price to earningsis: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Aperam: P/E of 9.13 = €24.58 ÷ €2.69 (Based on the year to March 2019.) A higher P/E ratio means that buyers have to paya higher pricefor each €1 the company has earned over the last year. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.' Generally speaking the rate of earnings growth has a profound impact on a company's P/E multiple. If earnings are growing quickly, then the 'E' in the equation will increase faster than it would otherwise. Therefore, even if you pay a high multiple of earnings now, that multiple will become lower in the future. So while a stock may look expensive based on past earnings, it could be cheap based on future earnings. Aperam saw earnings per share decrease by 24% last year. But EPS is up 10% over the last 3 years. One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. We can see in the image below that the average P/E (10.3) for companies in the metals and mining industry is higher than Aperam's P/E. This suggests that market participants think Aperam will underperform other companies in its industry. Since the market seems unimpressed with Aperam, it's quite possible it could surprise on the upside. You should delve deeper. I like to checkif company insiders have been buying or selling. It's important to note that the P/E ratio considers the market capitalization, not the enterprise value. So it won't reflect the advantage of cash, or disadvantage of debt. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash). Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof). Net debt totals just 5.4% of Aperam's market cap. It would probably trade on a higher P/E ratio if it had a lot of cash, but I doubt it is having a big impact. Aperam's P/E is 9.1 which is below average (17.8) in the NL market. The debt levels are not a major concern, but the lack of EPS growth is likely weighing on sentiment. When the market is wrong about a stock, it gives savvy investors an opportunity. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. So thisfreevisualization of the analyst consensus on future earningscould help you make theright decisionabout whether to buy, sell, or hold. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Want To Invest In Apar Industries Limited (NSE:APARINDS)? Here's How It Performed Lately Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Examining Apar Industries Limited's (NSE:APARINDS) past track record of performance is a valuable exercise for investors. It enables us to understand whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess APARINDS's latest performance announced on 31 March 2019 and weigh these figures against its longer term trend and industry movements. See our latest analysis for Apar Industries APARINDS's trailing twelve-month earnings (from 31 March 2019) of ₹1.4b has declined by -6.0% compared to the previous year. Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 14%, indicating the rate at which APARINDS is growing has slowed down. What could be happening here? Well, let’s take a look at what’s occurring with margins and if the rest of the industry is experiencing the hit as well. In terms of returns from investment, Apar Industries has fallen short of achieving a 20% return on equity (ROE), recording 11% instead. Furthermore, its return on assets (ROA) of 6.7% is below the IN Industrials industry of 7.2%, indicating Apar Industries's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Apar Industries’s debt level, has declined over the past 3 years from 34% to 29%. While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors affecting its business. I recommend you continue to research Apar Industries to get a more holistic view of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for APARINDS’s future growth? Take a look at ourfree research report of analyst consensusfor APARINDS’s outlook. 2. Financial Health: Are APARINDS’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Chinas obsession with looking good is filtering into facial-recognition payments China, the worlds third-largest consumer of plastic surgery and an avid user of beauty filters on photo and video apps, is bringing self-enhancement into the financial domain. Alipay , the mobile payment arm of fintech giant Ant Financial , said on Tuesday (July 2) that, by popular demand, it would soon adopt beautifying filters (in Chinese) in its facial-recognition payment systems at retail locations across the nation. The announcement comes after a recent poll (in Chinese) held by tech news portal Sina Technology that asked people whether scanning their faces when making payments made them feel ugly. Over 60% of the more than 40,000 respondents said yes. Scientists may have found a better way to spot early signs of dementia: our eyes I have noticed you guys think I made you look ugly. Alipay will roll out beautifying filters for all of its offline facial-recognition payment systems within a weeks time: be ware youll then look even better than in a beauty camera! the official account of Alipay said on social media platform Weibo, part of Sina. The system will still use unretouched images of users for processing, according to the company, but customers will see a beautified version of themselves at the digital till for the brief seconds when they scan their faces. It also said it has already incorporated such filters in its mobile phone app. The announcement is a reflection of the widespread beauty-filter culture in China, where many young peoples sense of self has been shaped by selfie and live-streaming apps such as HK-listed Meitu (which is now segueing into beauty care). As a result, they can feel a disconnect from untouched images of themselvesa situation thats not unique to China . Theres even a label for the digitally enhanced look, which can take as much time as an offline makeover: internet celebrity face . Created in 2004 to provide a payment service for the Amazon-like giant Alibaba, and later spunoff into the company that became Ant, Alipay launched offline mobile payments via barcodes in 2011 . Retail payments using facial-recognition technology arrived in 2017, at a KFC outlet. The company, along with its local e-wallet partners, says it now has around 1 billion active users. Its biggest rival, WeChat Pay, the payment system of Tencents ubiquitous messaging app WeChat, had around 1 billion active monthly users as of May last year. Tens of thousands of merchants now use an Alipay plug-and play device called Dragon Fly to take face payments. Story continues Porsche and BMW are known as broken shoes and dont touch me in China China has been far quicker than other countries to adopt facial-recognition for public and commercial use. Its been used for everything from identifying jaywalkers to dispensing toilet paper . However, the technology is also posing privacy concerns and ethical challenges, as China shifts to using it to profile groups such as the countrys persecuted largely Muslim Uyghur ethnic minority . Update: This story was updated with the latest user numbers for Alipay and its partners. Sign up for the Quartz Daily Brief , our free daily newsletter with the worlds most important and interesting news. More stories from Quartz: Why so many people believe the moon landing was faked In India, toddlers are starting to write computer codes before they can talk
Do Insiders Own Lots Of Shares In Ascendas Hospitality Trust (SGX:Q1P)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! The big shareholder groups in Ascendas Hospitality Trust (SGX:Q1P) have power over the company. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented. Ascendas Hospitality Trust isn't enormous, but it's not particularly small either. It has a market capitalization of S$1.1b, which means it would generally expect to see some institutions on the share registry. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. Let's take a closer look to see what the different types of shareholder can tell us about Q1P. View our latest analysis for Ascendas Hospitality Trust Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing. As you can see, institutional investors own 7.4% of Ascendas Hospitality Trust. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Ascendas Hospitality Trust's earnings history, below. Of course, the future is what really matters. We note that hedge funds don't have a meaningful investment in Ascendas Hospitality Trust. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage. While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO. Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances. Our most recent data indicates that insiders own some shares in Ascendas Hospitality Trust. In their own names, insiders own S$87m worth of stock in the S$1.1b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checkingif those insiders have been selling. The general public, mostly retail investors, hold a substantial 51% stake in Q1P, suggesting it is a fairly popular stock. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio. Our data indicates that Private Companies hold 29%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. We can see that public companies hold 4.1%, of the Q1P shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further. I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. I always like to check for ahistory of revenue growth. You can too, by accessing this free chart ofhistoric revenue and earnings in thisdetailed graph. If you would prefer discover what analysts are predicting in terms of future growth, do not miss thisfreereport on analyst forecasts. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Neste Oyj (HEL:NESTE) Trading At A 34% Discount? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! In this article we are going to estimate the intrinsic value of Neste Oyj (HEL:NESTE) by projecting its future cash flows and then discounting them to today's value. I will be using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward. We generally believe that a company's value is the present value of all of the cash it will generate in the future. However, a DCF is just one valuation metric among many, and it is not without flaws. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model. See our latest analysis for Neste Oyj We are going to use a two-stage DCF model, which, as the name states, takes into account two stages of growth. The first stage is generally a higher growth period which levels off heading towards the terminal value, captured in the second 'steady growth' period. To begin with, we have to get estimates of the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, and so the sum of these future cash flows is then discounted to today's value: [{"": "Levered FCF (\u20ac, Millions)", "2020": "\u20ac984.0m", "2021": "\u20ac1.1b", "2022": "\u20ac1.5b", "2023": "\u20ac1.8b", "2024": "\u20ac2.0b", "2025": "\u20ac2.2b", "2026": "\u20ac2.4b", "2027": "\u20ac2.5b", "2028": "\u20ac2.6b", "2029": "\u20ac2.7b"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x10", "2021": "Analyst x9", "2022": "Analyst x3", "2023": "Analyst x1", "2024": "Est @ 13.39%", "2025": "Est @ 9.54%", "2026": "Est @ 6.84%", "2027": "Est @ 4.95%", "2028": "Est @ 3.63%", "2029": "Est @ 2.7%"}, {"": "Present Value (\u20ac, Millions) Discounted @ 6.9%", "2020": "\u20ac920.5", "2021": "\u20ac979.8", "2022": "\u20ac1.2k", "2023": "\u20ac1.4k", "2024": "\u20ac1.5k", "2025": "\u20ac1.5k", "2026": "\u20ac1.5k", "2027": "\u20ac1.5k", "2028": "\u20ac1.4k", "2029": "\u20ac1.4k"}] ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= €13.2b After calculating the present value of future cash flows in the intial 10-year period, we need to calculate the Terminal Value, which accounts for all future cash flows beyond the first stage. The Gordon Growth formula is used to calculate Terminal Value at a future annual growth rate equal to the 10-year government bond rate of 0.5%. We discount the terminal cash flows to today's value at a cost of equity of 6.9%. Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = €2.7b × (1 + 0.5%) ÷ (6.9% – 0.5%) = €42b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €€42b ÷ ( 1 + 6.9%)10= €21.62b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is €34.83b. To get the intrinsic value per share, we divide this by the total number of shares outstanding.This results in an intrinsic value estimate of €45.38. Relative to the current share price of €29.87, the company appears quite undervalued at a 34% discount to where the stock price trades currently. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. We would point out that the most important inputs to a discounted cash flow are the discount rate and of course the actual cash flows. You don't have to agree with these inputs, I recommend redoing the calculations yourself and playing with them. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Neste Oyj as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 6.9%, which is based on a levered beta of 0.977. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Whilst important, DCF calculation shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. What is the reason for the share price to differ from the intrinsic value? For Neste Oyj, There are three essential factors you should look at: 1. Financial Health: Does NESTE have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Future Earnings: How does NESTE's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart. 3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of NESTE? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the HEL every day. If you want to find the calculation for other stocks justsearch here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Should Investors Know About The Future Of ATOSS Software AG's (ETR:AOF)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Since ATOSS Software AG (ETR:AOF) released its earnings in March 2019, analyst consensus outlook seem in-line with its track record, as upcoming earnings growth is expected to be 13% next year, similar to the range of average earnings growth for the past five years of 14% per year. Presently, with latest-twelve-month earnings at €11m, we should see this growing to €13m by 2020. I will provide a brief commentary around the figures and analyst expectations in the near term. Readers that are interested in understanding the company beyond these figures shouldresearch its fundamentals here. Check out our latest analysis for ATOSS Software The 2 analysts covering AOF view its longer term outlook with a positive sentiment. Generally, broker analysts tend to make predictions for up to three years given the lack of visibility beyond this point. I've plotted out each year's earnings expectations and inserted a line of best fit to calculate an annual growth rate from the slope in order to understand the overall trajectory of AOF's earnings growth over these next few years. By 2022, AOF's earnings should reach €17m, from current levels of €11m, resulting in an annual growth rate of 14%. This leads to an EPS of €4.46 in the final year of projections relative to the current EPS of €2.82. With a current profit margin of 18%, this movement will result in a margin of 19% by 2022. Future outlook is only one aspect when you're building an investment case for a stock. For ATOSS Software, there are three important factors you should further research: 1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Valuation: What is ATOSS Software worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether ATOSS Software is currently mispriced by the market. 3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of ATOSS Software? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Arbonia AG (VTX:ARBN) A Volatile Stock? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Anyone researching Arbonia AG (VTX:ARBN) might want to consider the historical volatility of the share price. Volatility is considered to be a measure of risk in modern finance theory. Investors may think of volatility as falling into two main categories. First, we have company specific volatility, which is the price gyrations of an individual stock. Holding at least 8 stocks can reduce this kind of risk across a portfolio. The second sort is caused by the natural volatility of markets, overall. For example, certain macroeconomic events will impact (virtually) all stocks on the market. Some stocks are more sensitive to general market forces than others. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one. See our latest analysis for Arbonia Given that it has a beta of 1.15, we can surmise that the Arbonia share price has been fairly sensitive to market volatility (over the last 5 years). If the past is any guide, we would expect that Arbonia shares will rise quicker than the markets in times of optimism, but fall faster in times of pessimism. Share price volatility is well worth considering, but most long term investors consider the history of revenue and earnings growth to be more important. Take a look at how Arbonia fares in that regard, below. With a market capitalisation of CHF893m, Arbonia is a small cap stock. However, it is big enough to catch the attention of professional investors. It has a relatively high beta, which is not unusual among small-cap stocks. Because it takes less capital to move the share price of a smaller company, actively traded small-cap stocks often have a higher beta that a similar large-cap stock. Since Arbonia has a reasonably high beta, it's worth considering why it is so heavily influenced by broader market sentiment. For example, it might be a high growth stock or have a lot of operating leverage in its business model. In order to fully understand whether ARBN is a good investment for you, we also need to consider important company-specific fundamentals such as Arbonia’s financial health and performance track record. I urge you to continue your research by taking a look at the following: 1. Future Outlook: What are well-informed industry analysts predicting for ARBN’s future growth? Take a look at ourfree research report of analyst consensusfor ARBN’s outlook. 2. Past Track Record: Has ARBN been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of ARBN's historicalsfor more clarity. 3. Other Interesting Stocks: It's worth checking to see how ARBN measures up against other companies on valuation. You could start with thisfree list of prospective options. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Read This Before Buying Amadeus IT Group, S.A. (BME:AMS) Shares Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sellAmadeus IT Group, S.A.(BME:AMS), you may well want to know whether insiders have been buying or selling. It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market. We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard Universitystudyfound that 'insider purchases earn abnormal returns of more than 6% per year.' See our latest analysis for Amadeus IT Group Over the last year, we can see that the biggest insider sale was by the President, Luis Maroto Camino, for €1.7m worth of shares, at about €70.10 per share. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of €71.14. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 21.7% of Luis Maroto Camino's holding. Luis Maroto Camino was the only individual insider to sell over the last year. Luis Maroto Camino sold a total of 99173 shares over the year at an average price of €69.50. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date! For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket. For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Amadeus IT Group insiders own about €24m worth of shares. That equates to 0.08% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders. An insider sold Amadeus IT Group shares recently, but they didn't buy any. And even if we look to the last year, we didn't see any purchases. But since Amadeus IT Group is profitable and growing, we're not too worried by this. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! Of course,the future is what matters most. So if you are interested in Amadeus IT Group, you should check out thisfreereport on analyst forecasts for the company. If you would prefer to check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt. For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Quotes from Lee Iacocca about U.S. leadership, borrowing money and Henry Ford (Reuters) - Lee Iacocca was known for never holding back an opinion. Here are a few of his notable quotes: - "This is the day that makes the last three miserable years all seem worthwhile. We at Chrysler borrow money the old-fashioned way. We pay it back." - His 1983 speech announcing Chrysler, now part of Fiat Chrysler Automobiles, was paying back the $1.2 billion in government-backed loans that helped save the company. The money was paid back seven years early. "In my book, if you're not No. 1, you've got to innovate." - Discussing the genesis of the torrid-selling Chrysler minivan in his autobiography "Iacocca." - "If a guy is over 25% jerk, he's in trouble. And Henry was 95%." - A 2001 Time magazine interview on Henry Ford II, who fired him in 1978 after 32 years with Ford Motor Co. In his autobiography, Iacocca described Ford, head of the car company and the family dynasty, as cruel, crude and paranoid. - "A fiasco." - From a 2007 CBS News interview describing Chrysler's 1998 merger with German automaker Daimler-Benz after he had turned over the company a few years earlier to hand-picked successor Robert Eaton. He called the selection of Eaton the "worst decision I ever made." - "We've got a gang of clueless bozos steering our ship of state right over a cliff, we've got corporate gangsters stealing us blind and we can't even clean up after a hurricane much less build a hybrid car. But instead of getting mad, everyone sits around and nods their heads when the politicians say, 'Stay the course' ... I hardly recognize this country anymore." - The first page of his 2007 book "Where Have All the Leaders Gone?," which was especially critical of President George W. Bush - "I spent 24 hours with Snoop Dogg and didn't understand a word he said to me the whole time." - Telling an interviewer about the Chrysler commercials he made with the rapper in 2005. (Compiled by Bill Trott; Editing by Diane Craft and Lisa Shumaker)
Dassault Aviation SA (EPA:AM): Is It A Smart Long Term Opportunity? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! After Dassault Aviation SA's (EPA:AM) earnings announcement in December 2018, it seems that analyst expectations are fairly bearish, as a 11% rise in profits is expected in the upcoming year, compared with the higher past 5-year average growth rate of 13%. With trailing-twelve-month net income at current levels of €573m, we should see this rise to €635m in 2020. Below is a brief commentary around Dassault Aviation's earnings outlook going forward, which may give you a sense of market sentiment for the company. For those keen to understand more about other aspects of the company, you canresearch its fundamentals here. See our latest analysis for Dassault Aviation The 10 analysts covering AM view its longer term outlook with a positive sentiment. Given that it becomes hard to forecast far into the future, broker analysts tend to project ahead roughly three years. To reduce the year-on-year volatility of analyst earnings forecast, I've inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line. From the current net income level of €573m and the final forecast of €716m by 2022, the annual rate of growth for AM’s earnings is 7.5%. This leads to an EPS of €86.04 in the final year of projections relative to the current EPS of €69.06. Margins are currently sitting at 11%, which is expected to expand to 12% by 2022. Future outlook is only one aspect when you're building an investment case for a stock. For Dassault Aviation, there are three important factors you should look at: 1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Future Earnings: How does Dassault Aviation's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart. 3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of Dassault Aviation? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Do Insiders Own Lots Of Shares In Novisource N.V. (AMS:NOVI)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! A look at the shareholders of Novisource N.V. (AMS:NOVI) can tell us which group is most powerful. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented. Novisource is not a large company by global standards. It has a market capitalization of €15m, which means it wouldn't have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have not yet purchased shares. We can zoom in on the different ownership groups, to learn more about NOVI. Check out our latest analysis for Novisource Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors. There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Novisource, for yourself, below. We note that hedge funds don't have a meaningful investment in Novisource. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known. The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO. Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group. We can see that insiders own shares in Novisource N.V.. As individuals, the insiders collectively own €1.2m worth of the €15m company. It is good to see some investment by insiders, but I usually like to see higher insider holdings. It might be worth checkingif those insiders have been buying. The general public, who are mostly retail investors, collectively hold 72% of Novisource shares. With this size of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to decline an acquisition or merger that may not improve profitability. With a stake of 17%, private equity firms could influence the NOVI board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public. It seems that Private Companies own 3.3%, of the NOVI stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company. It's always worth thinking about the different groups who own shares in a company. But to understand Novisource better, we need to consider many other factors. I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow for free. Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
BOJ policymaker sees no need for immediate easing By Leika Kihara HIROSHIMA, Japan (Reuters) - The Bank of Japan does not need to ramp up monetary stimulus for now as a moderate recovery is expected later in the year but should be ready to loosen policy further if external pressure on the economy intensifies, board member Yukitoshi Funo said on Wednesday. Funo said Japan's economy was moving in line with the central bank's projection but risks, such as U.S.-China trade tensions, could disrupt the path toward achieving the central bank's 2% inflation target. "We can expect Japan's economy to recover in the latter half of this year. As such, I see no need to ease policy further now," Funo told a news conference after meeting with business leaders in Hiroshima, western Japan. "But we must act without hesitation if changes in overseas and domestic economic conditions hurt Japan's price momentum or the current favourable job market." The comments were the most direct signal to date by a BOJ policymaker that the central bank was in no rush to expand stimulus as long as the economy sustains a moderate recovery. Prime Minister Shinzo Abe praised the BOJ's massive stimulus for creating jobs and pulling Japan out of deflation. "The BOJ's policies weren't mistaken," Abe said. "I hope the BOJ continues to guide policy with an eye on achieving 2% inflation," he said on Wednesday in a debate with opposition party leaders in Tokyo. He added that the BOJ shouldn't persist in meeting its target at all cost. A former auto executive, Funo has consistently voted with the majority of the nine-member board. HANDS NOT TIED The widening fallout from the U.S.-China trade war and slowing global demand have forced many major central banks to cut interest rates or shift to a more dovish policy stance. The BOJ kept policy steady last month but governor Haruhiko Kuroda stressed his readiness to boost stimulus if the economy loses momentum to achieve his 2% inflation target. Some analysts say the central bank could ease policy further as early as this month, when it conducts a quarterly review of its growth and inflation forecasts. Funo said the trade conflict had yet to affect companies' plans for capital expenditure. Japanese manufacturers have also become more resilient to the effects of a strong yen on profits as they shift more production overseas, he said. But he warned that external risks warranted close attention as they could force changes to the BOJ's projection that Japan's economic growth will rebound in the latter half of this year. "I don't see the need to top up stimulus now," he said. "But we'll keep an eye out on how things unfold ahead of this month's meeting and those beyond," he said. Funo said overseas demand will likely pick up as stimulus measures taken by China prop up growth and help boost Japan's exports. Japan's economy expanded by an annualised 2.1% in the first quarter but many analysts predict growth will slow in the coming months as the U.S.-China tariff row hurts business sentiment and profits. A scheduled sales tax hike in October may also curb consumption, they warn. The BOJ faces a dilemma. Years of heavy money printing has failed to fire up inflation and strained financial institutions' profits by narrowing their margins with ultra-low rates. It is also left with little ammunition to battle the next recession, as its aggressive bond buying has led to it owning nearly half of the country's long-term debt and crushed bond yields to levels at or below zero. Funo said the BOJ would take into account the impact any further easing might have on Japan's banking system, but added that there was still room to top up monetary support. "I don't think our hands are tied in terms of what we can do" if the BOJ were to ease further, he said. Under a policy dubbed yield curve control (YCC), the BOJ guides short-term rates at minus 0.1% and long-term rates around 0% via heavy asset buying to accelerate inflation to its target. (Additional reporting by Tetsushi Kajimoto in Tokyo; Editing by Shri Navaratnam and Jacqueline Wong)
Does Public Joint Stock Company Territorial Generating Company No. 1 (MCX:TGKA) Have A High Beta? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! If you're interested in Public Joint Stock Company Territorial Generating Company No. 1 (MCX:TGKA), then you might want to consider its beta (a measure of share price volatility) in order to understand how the stock could impact your portfolio. Modern finance theory considers volatility to be a measure of risk, and there are two main types of price volatility. The first type is company specific volatility. Investors use diversification across uncorrelated stocks to reduce this kind of price volatility across the portfolio. The other type, which cannot be diversified away, is the volatility of the entire market. Every stock in the market is exposed to this volatility, which is linked to the fact that stocks prices are correlated in an efficient market. Some stocks are more sensitive to general market forces than others. Beta can be a useful tool to understand how much a stock is influenced by market risk (volatility). However, Warren Buffett said 'volatility is far from synonymous with risk' in his 2014 letter to investors. So, while useful, beta is not the only metric to consider. To use beta as an investor, you must first understand that the overall market has a beta of one. A stock with a beta greater than one is more sensitive to broader market movements than a stock with a beta of less than one. View our latest analysis for Territorial Generating Company No. 1 Zooming in on Territorial Generating Company No. 1, we see it has a five year beta of 0.83. This is below 1, so historically its share price has been rather independent from the market. This means that -- if history is a guide -- buying the stock would reduce the impact of overall market volatility in many portfolios (depending on the beta of the portfolio, of course). Beta is worth considering, but it's also important to consider whether Territorial Generating Company No. 1 is growing earnings and revenue. You can take a look for yourself, below. Territorial Generating Company No. 1 is a small company, but not tiny and little known. It has a market capitalisation of RUруб42b, which means it would be on the radar of intstitutional investors. Small companies can have a low beta value when company specific factors outweigh the influence of overall market volatility. That might be happening here. One potential advantage of owning low beta stocks like Territorial Generating Company No. 1 is that your overall portfolio won't be too sensitive to overall market movements. However, this can be a blessing or a curse, depending on what's happening in the broader market. This article aims to educate investors about beta values, but it's well worth looking at important company-specific fundamentals such as Territorial Generating Company No. 1’s financial health and performance track record. I highly recommend you dive deeper by considering the following: 1. Future Outlook: What are well-informed industry analysts predicting for TGKA’s future growth? Take a look at ourfree research report of analyst consensusfor TGKA’s outlook. 2. Past Track Record: Has TGKA been consistently performing well irrespective of the ups and downs in the market? Go into more detail in the past performance analysis and take a look atthe free visual representations of TGKA's historicalsfor more clarity. 3. Other Interesting Stocks: It's worth checking to see how TGKA measures up against other companies on valuation. You could start with thisfree list of prospective options. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Allianz SE's (FRA:ALV) P/E Ratio Really That Good? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! This article is written for those who want to get better at using price to earnings ratios (P/E ratios). To keep it practical, we'll show how Allianz SE's (FRA:ALV) P/E ratio could help you assess the value on offer.Allianz has a P/E ratio of 12.24, based on the last twelve months. That means that at current prices, buyers pay €12.24 for every €1 in trailing yearly profits. See our latest analysis for Allianz Theformula for P/Eis: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Allianz: P/E of 12.24 = €215.6 ÷ €17.62 (Based on the year to March 2019.) A higher P/E ratio means that investors are payinga higher pricefor each €1 of company earnings. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.' Earnings growth rates have a big influence on P/E ratios. If earnings are growing quickly, then the 'E' in the equation will increase faster than it would otherwise. That means even if the current P/E is high, it will reduce over time if the share price stays flat. A lower P/E should indicate the stock is cheap relative to others -- and that may attract buyers. Most would be impressed by Allianz earnings growth of 12% in the last year. And earnings per share have improved by 6.1% annually, over the last five years. With that performance, you might expect an above average P/E ratio. We can get an indication of market expectations by looking at the P/E ratio. The image below shows that Allianz has a lower P/E than the average (13.4) P/E for companies in the insurance industry. Allianz's P/E tells us that market participants think it will not fare as well as its peers in the same industry. While current expectations are low, the stock could be undervalued if the situation is better than the market assumes. If you consider the stock interesting, further research is recommended. For example, I often monitordirector buying and selling. It's important to note that the P/E ratio considers the market capitalization, not the enterprise value. So it won't reflect the advantage of cash, or disadvantage of debt. Hypothetically, a company could reduce its future P/E ratio by spending its cash (or taking on debt) to achieve higher earnings. Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio. Net debt totals 15% of Allianz's market cap. It would probably deserve a higher P/E ratio if it was net cash, since it would have more options for growth. Allianz's P/E is 12.2 which is below average (20.1) in the DE market. The EPS growth last year was strong, and debt levels are quite reasonable. The low P/E ratio suggests current market expectations are muted, implying these levels of growth will not continue. Investors should be looking to buy stocks that the market is wrong about. If it is underestimating a company, investors can make money by buying and holding the shares until the market corrects itself. So thisfreevisual report on analyst forecastscould hold the key to an excellent investment decision. You might be able to find a better buy than Allianz. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Why FW Thorpe Plc's (LON:TFW) CEO Pay Matters To You Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Mike Allcock has been the CEO of FW Thorpe Plc ( LON:TFW ) since 2010. First, this article will compare CEO compensation with compensation at similar sized companies. Then we'll look at a snap shot of the business growth. Third, we'll reflect on the total return to shareholders over three years, as a second measure of business performance. This method should give us information to assess how appropriately the company pays the CEO. See our latest analysis for FW Thorpe How Does Mike Allcock's Compensation Compare With Similar Sized Companies? According to our data, FW Thorpe Plc has a market capitalization of UK£372m, and pays its CEO total annual compensation worth UK£629k. (This figure is for the year to June 2018). While we always look at total compensation first, we note that the salary component is less, at UK£256k. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of UK£159m to UK£635m. The median total CEO compensation was UK£682k. So Mike Allcock receives a similar amount to the median CEO pay, amongst the companies we looked at. While this data point isn't particularly informative alone, it gains more meaning when considered with business performance. You can see, below, how CEO compensation at FW Thorpe has changed over time. AIM:TFW CEO Compensation, July 3rd 2019 Is FW Thorpe Plc Growing? FW Thorpe Plc has increased its earnings per share (EPS) by an average of 10.0% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 1.6%. I'm not particularly impressed by the revenue growth, but it is good to see modest EPS growth. So there are some positives here, but not enough to earn high praise. You might want to check this free visual report on analyst forecasts for future earnings . Has FW Thorpe Plc Been A Good Investment? Most shareholders would probably be pleased with FW Thorpe Plc for providing a total return of 51% over three years. So they may not be at all concerned if the CEO were to be paid more than is normal for companies around the same size. Story continues In Summary... Mike Allcock is paid around what is normal the leaders of comparable size companies. The company isn't showing particularly great growth, but shareholder returns have been pleasing. So all things considered I'd venture that the CEO pay is appropriate. So you may want to check if insiders are buying FW Thorpe shares with their own money (free access). Important note: FW Thorpe may not be the best stock to buy. You might find something better in this list of interesting companies with high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor at [email protected] . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Asahi India Glass Limited's (NSE:ASAHIINDIA) CEO Salary Justified? Want to participate in a short research study ? Help shape the future of investing tools and you could win a $250 gift card! Sanjay Labroo became the CEO of Asahi India Glass Limited ( NSE:ASAHIINDIA ) in 1990. This report will, first, examine the CEO compensation levels in comparison to CEO compensation at companies of similar size. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels. View our latest analysis for Asahi India Glass How Does Sanjay Labroo's Compensation Compare With Similar Sized Companies? At the time of writing our data says that Asahi India Glass Limited has a market cap of ₹52b, and is paying total annual CEO compensation of ₹38m. (This number is for the twelve months until March 2018). While we always look at total compensation first, we note that the salary component is less, at ₹21m. As part of our analysis we looked at companies in the same jurisdiction, with market capitalizations of ₹28b to ₹110b. The median total CEO compensation was ₹24m. Thus we can conclude that Sanjay Labroo receives more in total compensation than the median of a group of companies in the same market, and of similar size to Asahi India Glass Limited. However, this doesn't necessarily mean the pay is too high. We can get a better idea of how generous the pay is by looking at the performance of the underlying business. You can see a visual representation of the CEO compensation at Asahi India Glass, below. NSEI:ASAHIINDIA CEO Compensation, July 3rd 2019 Is Asahi India Glass Limited Growing? Over the last three years Asahi India Glass Limited has grown its earnings per share (EPS) by an average of 27% per year (using a line of best fit). Its revenue is up 11% over last year. This shows that the company has improved itself over the last few years. Good news for shareholders. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. It could be important to check this free visual depiction of what analysts expect for the future . Story continues Has Asahi India Glass Limited Been A Good Investment? Asahi India Glass Limited has served shareholders reasonably well, with a total return of 26% over three years. But they probably wouldn't be so happy as to think the CEO should be paid more than is normal, for companies around this size. In Summary... We examined the amount Asahi India Glass Limited pays its CEO, and compared it to the amount paid by similar sized companies. Our data suggests that it pays above the median CEO pay within that group. However we must not forget that the EPS growth has been very strong over three years. We also think investors are doing ok, over the same time period. You might wish to research management further, but on this analysis, considering the EPS growth, we wouldn't call the CEO pay problematic. Whatever your view on compensation, you might want to check if insiders are buying or selling Asahi India Glass shares (free trial). Arguably, business quality is much more important than CEO compensation levels. So check out this free list of interesting companies, that have HIGH return on equity and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. If you spot an error that warrants correction, please contact the editor at [email protected] . This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Does Ucar SA's (EPA:ALUCR) P/E Ratio Tell You? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll show how you can use Ucar SA's (EPA:ALUCR) P/E ratio to inform your assessment of the investment opportunity. Based on the last twelve months,Ucar's P/E ratio is 29.87. In other words, at today's prices, investors are paying €29.87 for every €1 in prior year profit. See our latest analysis for Ucar Theformula for price to earningsis: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Ucar: P/E of 29.87 = €16.6 ÷ €0.56 (Based on the trailing twelve months to December 2018.) A higher P/E ratio means that buyers have to paya higher pricefor each €1 the company has earned over the last year. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E. Earnings growth rates have a big influence on P/E ratios. That's because companies that grow earnings per share quickly will rapidly increase the 'E' in the equation. That means even if the current P/E is high, it will reduce over time if the share price stays flat. A lower P/E should indicate the stock is cheap relative to others -- and that may attract buyers. Ucar increased earnings per share by 4.0% last year. And it has improved its earnings per share by 1.4% per year over the last three years. In contrast, EPS has decreased by 2.4%, annually, over 5 years. We can get an indication of market expectations by looking at the P/E ratio. The image below shows that Ucar has a higher P/E than the average (10.7) P/E for companies in the transportation industry. That means that the market expects Ucar will outperform other companies in its industry. Clearly the market expects growth, but it isn't guaranteed. So investors should delve deeper. I like to checkif company insiders have been buying or selling. It's important to note that the P/E ratio considers the market capitalization, not the enterprise value. Thus, the metric does not reflect cash or debt held by the company. The exact same company would hypothetically deserve a higher P/E ratio if it had a strong balance sheet, than if it had a weak one with lots of debt, because a cashed up company can spend on growth. Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context. Since Ucar holds net cash of €1.6m, it can spend on growth, justifying a higher P/E ratio than otherwise. Ucar has a P/E of 29.9. That's higher than the average in the FR market, which is 18. Earnings improved over the last year. Also positive, the relatively strong balance sheet will allow for investment in growth -- and the P/E indicates shareholders that will happen! Investors should be looking to buy stocks that the market is wrong about. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock. But note:Ucar may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Type Of Shareholder Owns TXCOM Société Anonyme's (EPA:ALTXC)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Every investor in TXCOM Société Anonyme (EPA:ALTXC) should be aware of the most powerful shareholder groups. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.' With a market capitalization of €7.9m, TXCOM Société Anonyme is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutions don't own shares in the company. We can zoom in on the different ownership groups, to learn more about ALTXC. Check out our latest analysis for TXCOM Société Anonyme We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common. There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to fund under management, so the institition does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of TXCOM Société Anonyme, for yourself, below. TXCOM Société Anonyme is not owned by hedge funds. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held. While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO. I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions. It seems that insiders own more than half the TXCOM Société Anonyme stock. This gives them a lot of power. Given it has a market cap of €7.9m, that means they have €5.6m worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You canclick here to see if those insiders have been buying or selling. With a 10% ownership, the general public have some degree of sway over ALTXC. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run. With a stake of 19%, private equity firms could influence the ALTXC board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public. I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. I always like to check for ahistory of revenue growth. You can too, by accessing this free chart ofhistoric revenue and earnings in thisdetailed graph. Of coursethis may not be the best stock to buy. So take a peek at thisfreefreelist of interesting companies. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Roche says one-dose Xofluza flu drug as good as older Tamiflu in kids ZURICH (Reuters) - Swiss drugmaker Roche said its new one-dose flu medicine Xofluza was comparable to its 20-year-old drug Tamiflu in reducing the duration of symptoms of the viral disease, citing a study of the drug in children aged one to 12 years old. Xofluza, an oral treatment, was well tolerated in children, said Roche, whose medicine is already approved broadly in Japan and for people older than 12 in the United States. The company is seeking to establish Xofluza as a more-convenient alternative to its older Tamiflu, which must be taken twice daily for five days and which is off patent, allowing cheap copies to crowd in. Xofluza's list price is about $150, while generic Tamiflu, also called oseltamivir, can cost less. (Reporting by John Miller; Editing by Michael Shields) View comments
Investors Who Bought Altia Oyj (HEL:ALTIA) Shares A Year Ago Are Now Down 16% Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! It's easy to match the overall market return by buying an index fund. But if you buy individual stocks, you can do both better or worse than that. For example, theAltia Oyj(HEL:ALTIA) share price is down 16% in the last year. That contrasts poorly with the market return of 2.3%. Altia Oyj may have better days ahead, of course; we've only looked at a one year period. The silver lining is that the stock is up 2.6% in about a week. Check out our latest analysis for Altia Oyj While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). Unfortunately Altia Oyj reported an EPS drop of 18% for the last year. This proportional reduction in earnings per share isn't far from the 16% decrease in the share price. So it seems that the market sentiment has not changed much, despite the weak results. Rather, the share price is remains a similar multiple of the EPS, suggesting the outlook remains the same. You can see below how EPS has changed over time (discover the exact values by clicking on the image). Dive deeper into Altia Oyj's key metrics by checking this interactive graph of Altia Oyj'searnings, revenue and cash flow. It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. In the case of Altia Oyj, it has a TSR of -11% for the last year. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted thetotalshareholder return. While Altia Oyj shareholders are down 11% for the year (even including dividends), the market itself is up 2.3%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. The share price decline has continued throughout the most recent three months, down 1.9%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Keeping this in mind, a solid next step might be to take a look at Altia Oyj's dividend track record. Thisfreeinteractive graphis a great place to start. If you like to buy stocks alongside management, then you might just love thisfreelist of companies. (Hint: insiders have been buying them). Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on FI exchanges. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Dear finance minister, your budget could seal Indian aviation’s fate For a while now, India’s aviation industry has been on a wing and a prayer. Burdened by high fuel prices, rising cost of airport operations , and taxes, the sector will be high on hope as finance minister Nirmala Sitharaman presents her first union budget on July 5. Scientists may have found a better way to spot early signs of dementia: our eyes Policy initiatives have become imperative as the dire straits that airlines are in show. India’s oldest private carrier halted operations over two months ago and has now been referred by lenders to the debt tribunal for bankruptcy proceedings . State-run Air India, meanwhile, may not be able to pay salaries beyond October as it is burdened by debt repayments, reported the Economic Times newspaper, quoting senior officials. This has had an impact on domestic passenger traffic, which, for the first time in five years, contracted by 4.5% year-on-year in April, data from sector regulator directorate general of civil aviation show. “Given the strong contribution of the aviation sector to the economy, the union budget should address the challenges related to complex policies, a multi-tiered tax system and (poor) infrastructure,” Indiver Rastogi, president and group head of global business travel at Thomas Cook (India), told Quartz. Porsche and BMW are known as “broken shoes” and “don’t touch me” in China Here’s what experts want Sitharaman to focus on: Regional connectivity Budget carriers IndiGo and SpiceJet have started to reap the benefits of introducing flights to non-metro cities . “There is a huge surge in demand from smaller cities for domestic travel. While RCS (regional connectivity scheme) has made notable progress, steps should be taken to encourage more airlines to fly to some of the tier 2 and tier 3 regional airports,” said Aloke Bajpai, CEO and co-founder of the Gurugram-based travel portal Ixigo. In 2017, India launched the Ude Desh ka Aam Nagrik (UDAN), which aims to increase regional connectivity by capping airfares on these routes. Air India’s subsidiary Airline Allied Services, SpiceJet, IndiGo, Air Deccan, Air Odisha and Turbo Megha are the main flight operators under UDAN. Experts say more airlines should be included and the scope of RCS initiatives should be expanded. “Sustained delivery on key initiatives like UDAN, Heritage City Development and Augmentation Yojana (HRIDAY), and integrated development of pilgrimage destinations through Pilgrimage Rejuvenation and Spirituality Augmentation Drive (PRASAD) is the need of the hour,” said Mahesh Iyer, executive director and chief executive officer, Thomas Cook (India). Story continues Lower taxes Aviation Turbine Fuel (ATF) in India has not yet been brought under the goods and services tax (GST) regime. The central government currently charges an 11% excise duty on ATF and state-level taxes can go as high as 30%. “There is a need for bringing air turbine fuel within the ambit of the goods and services tax, thereby effectively capping the tax rate at 28% and ensuring seamless flow of input tax credits,” Anuj Prasad, partner, Shardul Amarchand Mangaldas, a Delhi-based corporate law firm, told Quartz. Airlines and travel portals say they are also burdened by tax collected at source (TCS) when they sell a services. “As this sector is one of the most tax compliant in India, we hope the government will take necessary actions to remit or remove TCS entirely. This will alleviate the unnecessary financial burden on airlines and OTAs (Open Travel Alliance, a group of major airlines, hoteliers, and others in the travel industry),” said Indroneel Dutt, chief financial officer at Cleartrip, a Mumbai-based online travel firm. Allied sectors Analysts’ hopes for sectors tied to the aviation industry are also high. For instance, the Maintenance, Repair and Overhaul (MRO) industry, should get tax cuts, they say. “The budget should try to address the tax issues faced by MRO industry by reducing the GST rate. Currently airlines prefer getting cheaper services from countries like Sri Lanka, Singapore, Malaysia and not from India. So a policy providing some relief in that aspect is expected,” said Vishal Kotecha, associate director at India Ratings & Research Private Limited, a New Delhi-based credit rating agency. Focus on providing superior infrastructure is also in the budget wish list. “The government must incentivise infrastructure activities in the sector, such as development of new commercial airports in high customer density areas,” Prasad said. Rajeev Kale, president and country head for holidays at Thomas Cook (India) advocated strengthening of overall infra ecosystem. “A focus on increasing allocation to development of new tourism circuits and attractions, along with improvement of roads, railways, airports, waterways and sanitation will catalyse growth.” Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: Why so many people believe the moon landing was faked In India, toddlers are starting to write computer codes before they can talk View comments
Purple Bricks to pull out of US as losses jump 88% A for sale sign for Purple Bricks in Southend on Sea, England. Photo: John Keeble/Getty Images Online real estate agency Purple Bricks ( PURP.L ) will pull out of the United States, the company announced Wednesday. Operating losses at the firm jumped by 88% to £52.3m in its most recent financial year. The company had already said it would scale back its ambitions in the US in May, when it ousted its CEO and withdrew from the Australian market. The latest announcement came as part of the company’s full-year results. While losses at the firm almost doubled, group revenue was up 55% to £136.5m. Revenue in the UK, which accounted for two-thirds of all revenue, jumped 21% to £90.1m. The company said it made an operating profit of £5.3m in the UK. Its Canadian division, following its July 2018 acquisition of Quebec real estate firm DuProprio, contributed revenue of £23.7m. But its US and Australian divisions posted a combined operating loss of £51.1m. “We have taken the difficult decisions to exit our businesses in both Australia and the US as it is very important that we now focus our resources on the UK and Canada,” the company’s new CEO, Vic Darvey, said on Wednesday. Darvey said the withdrawals from Australia and the US would be conducted “in an orderly manner” and are expected to be complete by the end of 2019. In May, Purple Bricks founder and CEO Michael Bruce departed the company. Chairman Paul Pindar said its rate of geographic expansion was “too rapid,” and that the quality of execution had “suffered.” While the company on Wednesday reiterated its medium-term goal of gaining 10% of the UK market, it pointed to Brexit. Purple Bricks said “current economic and political uncertainty” mean conditions “remain challenging.” The downward trend in volume, however, was partially offset by higher average revenues, the company said. Taking into account closure costs, total losses in Purple Bricks’ Australian and US businesses are expected to be between £10m and £14m in its 2020 financial year, the company’s CFO, James Davies, said on Wednesday. Story continues Purple Bricks was founded in 2012 with the aim of disrupting the real estate market. It has no local branches, and charges an up-front fee for advertising properties and arranging viewings, rather than a sale commission. The company said on Wednesday that it saved UK customers £77m in commission last year. Last month, German publishing group Axel Springer ( SPR.DE ) announced it had doubled its stake in Purple Bricks . Axel Springer now holds 26.6% of the company, up from its previous 12.4% stake. The publishing group’s previous investment, in March 2018, was supposed to help the company accelerate its overseas expansion.
Why Public Joint Stock Company ALROSA (MCX:ALRS) Is A Financially Healthy Company Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Small-caps and large-caps are wildly popular among investors; however, mid-cap stocks, such as Public Joint Stock Company ALROSA (MCX:ALRS) with a market-capitalization of RUруб614b, rarely draw their attention. Despite this, commonly overlooked mid-caps have historically produced better risk-adjusted returns than their small and large-cap counterparts. ALRS’s financial liquidity and debt position will be analysed in this article, to get an idea of whether the company can fund opportunities for strategic growth and maintain strength through economic downturns. Remember this is a very top-level look that focuses exclusively on financial health, so I recommend a deeper analysisinto ALRS here. See our latest analysis for ALROSA ALRS has built up its total debt levels in the last twelve months, from RUруб59b to RUруб107b , which includes long-term debt. With this increase in debt, the current cash and short-term investment levels stands at RUруб68b to keep the business going. Moreover, ALRS has generated RUруб104b in operating cash flow in the last twelve months, leading to an operating cash to total debt ratio of 98%, indicating that ALRS’s operating cash is sufficient to cover its debt. At the current liabilities level of RUруб77b, it seems that the business has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 2.29x. The current ratio is the number you get when you divide current assets by current liabilities. For Metals and Mining companies, this ratio is within a sensible range as there's enough of a cash buffer without holding too much capital in low return investments. ALRS’s level of debt is appropriate relative to its total equity, at 39%. This range is considered safe as ALRS is not taking on too much debt obligation, which may be constraining for future growth. We can check to see whether ALRS is able to meet its debt obligations by looking at the net interest coverage ratio. A company generating earnings before interest and tax (EBIT) at least three times its net interest payments is considered financially sound. In ALRS's, case, the ratio of 22.84x suggests that interest is comfortably covered, which means that lenders may be inclined to lend more money to the company, as it is seen as safe in terms of payback. ALRS’s debt level is appropriate for a company its size, and it is also able to generate sufficient cash flow coverage, meaning it has been able to put its debt in good use. Furthermore, the company will be able to pay all of its upcoming liabilities from its current short-term assets. This is only a rough assessment of financial health, and I'm sure ALRS has company-specific issues impacting its capital structure decisions. You should continue to research ALROSA to get a better picture of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for ALRS’s future growth? Take a look at ourfree research report of analyst consensusfor ALRS’s outlook. 2. Valuation: What is ALRS worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether ALRS is currently mispriced by the market. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Should You Be Excited About TeamLease Services Limited's (NSE:TEAMLEASE) 18% Return On Equity? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand TeamLease Services Limited (NSE:TEAMLEASE). Over the last twelve monthsTeamLease Services has recorded a ROE of 18%. That means that for every ₹1 worth of shareholders' equity, it generated ₹0.18 in profit. See our latest analysis for TeamLease Services Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for TeamLease Services: 18% = ₹980m ÷ ₹5.4b (Based on the trailing twelve months to March 2019.) It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets. ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the yearly profit. That means that the higher the ROE, the more profitable the company is. So, as a general rule,a high ROE is a good thing. Clearly, then, one can use ROE to compare different companies. By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, TeamLease Services has a higher ROE than the average (9.4%) in the Professional Services industry. That's what I like to see. We think a high ROE, alone, is usually enough to justify further research into a company. One data point to check is ifinsiders have bought shares recently. Most companies need money -- from somewhere -- to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. That will make the ROE look better than if no debt was used. While TeamLease Services does have a tiny amount of debt, with debt to equity of just 0.02, we think the use of debt is very modest. The combination of modest debt and a very respectable ROE suggests this is a business worth watching. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises. Return on equity is one way we can compare the business quality of different companies. In my book the highest quality companies have high return on equity, despite low debt. If two companies have around the same level of debt to equity, and one has a higher ROE, I'd generally prefer the one with higher ROE. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. It is important to consider other factors, such as future profit growth -- and how much investment is required going forward. So I think it may be worth checking thisfreereport on analyst forecasts for the company. Of courseTeamLease Services may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Should Investors Know About Yuzhou Properties Company Limited's (HKG:1628) Growth? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Yuzhou Properties Company Limited's (HKG:1628) most recent earnings update in April 2019 indicated that the company gained from a robust tailwind, eventuating to a double-digit earnings growth of 23%. Investors may find it useful to understand how market analysts perceive Yuzhou Properties's earnings growth outlook over the next couple of years and whether the future looks even brighter than the past. I will be looking at earnings excluding extraordinary items to exclude one-off activities to get a better understanding of the underlying drivers of earnings. Check out our latest analysis for Yuzhou Properties Analysts' expectations for next year seems positive, with earnings climbing by a robust 27%. This growth seems to continue into the following year with rates reaching double digit 55% compared to today’s earnings, and finally hitting CN¥6.3b by 2022. Although it is useful to be aware of the growth each year relative to today’s figure, it may be more beneficial to gauge the rate at which the company is rising or falling every year, on average. The benefit of this technique is that we can get a better picture of the direction of Yuzhou Properties's earnings trajectory over the long run, irrespective of near term fluctuations, which may be more relevant for long term investors. To compute this rate, I've inserted a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 20%. This means that, we can anticipate Yuzhou Properties will grow its earnings by 20% every year for the next couple of years. For Yuzhou Properties, there are three essential factors you should further examine: 1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Valuation: What is 1628 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether 1628 is currently mispriced by the market. 3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of 1628? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Brexit Withdrawal Agreement will stand as it is, says German ambassador LONDON, July 3 (Reuters) - Germany will be willing to explore any ideas put forward by a new British prime minister to break the Brexit deadlock but the Withdrawal Agreement "will stand as it is", Germany's ambassador to London said on Wednesday. "Once there is a new prime minister in this country we will explore the new ideas that are being presented but with a point that is important in mind that the withdrawal agreement will stand as it is," Peter Wittig told BBC Radio. Britain's ruling Conservative Party is due to name either Boris Johnson or Jeremy Hunt as the new prime minister on July 23. (Reporting by Kate Holton; editing by Guy Faulconbridge)
These Factors Make Titanium Oyj (HEL:TITAN) An Interesting Investment Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Building up an investment case requires looking at a stock holistically. Today I've chosen to put the spotlight on Titanium Oyj (HEL:TITAN) due to its excellent fundamentals in more than one area. TITAN is a company with great financial health as well as a an impressive track record of performance. Below is a brief commentary on these key aspects. If you're interested in understanding beyond my broad commentary, take a look at thereport on Titanium Oyj here. Over the past few years, TITAN has more than doubled its earnings, with its most recent figure exceeding its annual average over the past five years. This strong performance generated a robust double-digit return on equity of 26%, which is an optimistic signal for the future. TITAN's strong financial health means that all of its upcoming liability payments are able to be met by its current cash and short-term investment holdings. This indicates that TITAN has sufficient cash flows and proper cash management in place, which is a crucial insight into the health of the company. Looking at TITAN's capital structure, the company has no debt on its balance sheet. This means it is running its business only on equity capital funding, which is typically normal for a small-cap company. Investors’ risk associated with debt is virtually non-existent and the company has plenty of headroom to grow debt in the future, should the need arise. For Titanium Oyj, there are three fundamental aspects you should further research: 1. Future Outlook: What are well-informed industry analysts predicting for TITAN’s future growth? Take a look at ourfree research report of analyst consensusfor TITAN’s outlook. 2. Valuation: What is TITAN worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether TITAN is currently mispriced by the market. 3. Other Attractive Alternatives: Are there other well-rounded stocks you could be holding instead of TITAN? Exploreour interactive list of stocks with large potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Now The Time To Put OEM International (STO:OEM B) On Your Watchlist? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! For beginners, it can seem like a good idea (and an exciting prospect) to buy a company that tells a good story to investors, even if it completely lacks a track record of revenue and profit. But as Peter Lynch said inOne Up On Wall Street, 'Long shots almost never pay off.' If, on the other hand, you like companies that have revenue, and even earn profits, then you may well be interested inOEM International(STO:OEM B). Now, I'm not saying that the stock is necessarily undervalued today; but I can't shake an appreciation for the profitability of the business itself. In comparison, loss making companies act like a sponge for capital - but unlike such a sponge they do not always produce something when squeezed. Check out our latest analysis for OEM International If you believe that markets are even vaguely efficient, then over the long term you'd expect a company's share price to follow its earnings per share (EPS). Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. OEM International managed to grow EPS by 15% per year, over three years. That's a pretty good rate, if the company can sustain it. One way to double-check a company's growth is to look at how its revenue, and earnings before interest and tax (EBIT) margins are changing. While we note OEM International's EBIT margins were flat over the last year, revenue grew by a solid 13% to kr3.2b. That's progress. You can take a look at the company's revenue and earnings growth trend, in the chart below. For finer detail, click on the image. While profitability drives the upside, prudent investors alwayscheck the balance sheet, too. I like company leaders to have some skin in the game, so to speak, because it increases alignment of incentives between the people running the business, and its true owners. As a result, I'm encouraged by the fact that insiders own OEM International shares worth a considerable sum. Indeed, they have a glittering mountain of wealth invested in it, currently valued at kr1.2b. That equates to 21% of the company, making insiders powerful and aligned with other shareholders. So it might be my imagination, but I do sense the glimmer of an opportunity. As I already mentioned, OEM International is a growing business, which is what I like to see. If that's not enough on its own, there is also the rather notable levels of insider ownership. That combination appeals to me, for one. So yes, I do think the stock is worth keeping an eye on. Now, you could try to make up your mind on OEM International by focusing on just these factors,oryou couldalsoconsider how its price-to-earnings ratio compares to other companies in its industry. Of course, you can do well (sometimes) buying stocks thatare notgrowing earnings anddo nothave insiders buying shares. But as a growth investor I always like to check out companies thatdohave those features. You can accessa free list of them here. Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Tanks roll into Washington DC for Trump's 4 July parade, as $2.5m ‘diverted from parks funding’ to help pay for it Tanks have rolled into Washington DC as preparations for Donald Trump ‘s so-called “salute to America” extravaganza on 4 July neared completion. M1 Abrams main battle tanks were transported to the capital by rail alongside Bradley fighting vehicles, and are expected to be among a wide array of military hardware on show. Flyovers by the US Navy’s Blue Angels display team and Air Force One, and potentially F-22 and F-35 stealth fighters, a B2 bomber plus US Marine Corps helicopters, are also set to take place, shutting down air traffic at Ronald Reagan airport. It came as the National Park Service was forced to divert some $2.5m (£2m) in entrance fees to help pay for the event, according to the Washington Post . Such funds are ordinarily used to maintain habitats inside parks or repair roads, the paper reported. The White House has not said how much it expects the celebrations, reminiscent of France’s Bastille Day festivities which Mr Trump witnessed in 2017, to cost overall. The Pentagon postponed a military parade planned for last November after estimates it could set taxpayers back $90m (£72m). The Post also reported on fears that the weight of tanks could damage the Lincoln Memorial, where Mr Trump plans to give a speech. Engineers were assessing whether the 62-ton Abrams vehicles could affect underground rooms at the site. Washington’s legislature, the Council of the District of Columbia, said the war machines could damage local roads and tweeted: “Tanks, but no tanks.” Mr Trump’s opponents have questioned whether he will turn the independence day celebrations into a political rally. His address at the Lincoln Memorial is intended “to honour America’s armed forces”, the Interior Department has previously said, though the president has a notoriously freewheeling style of public speaking. The plans constituted “a shameful misuse of our military for a gratuitous display of strength by a president who relishes the attention of despots and dictators,” claimed congresswoman Betty McCollum. Story continues Presidents have not traditionally sought a prominent role in 4 July celebrations. Hogan Gidley, the White House spokesman, called any suggestion Mr Trump could politicise the event “absolutely ridiculous”. “This is all about a salute to America. The president is not going to get political,” he told Fox Business Network. Regardless of the content of his address, Mr Trump will face protests with anti-war group Code Pink having secured permission to bring a Trump baby blimp to the capital – though, reportedly, not to fill it with helium that would allow it to float. Additional reporting by agencies
Do You Know What Oxford Metrics Plc's (LON:OMG) P/E Ratio Means? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! This article is written for those who want to get better at using price to earnings ratios (P/E ratios). We'll look at Oxford Metrics Plc's (LON:OMG) P/E ratio and reflect on what it tells us about the company's share price.Oxford Metrics has a price to earnings ratio of 27.13, based on the last twelve months. That corresponds to an earnings yield of approximately 3.7%. View our latest analysis for Oxford Metrics Theformula for price to earningsis: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for Oxford Metrics: P/E of 27.13 = £0.95 ÷ £0.035 (Based on the trailing twelve months to March 2019.) A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't necessarily good or bad, but a high P/E implies relatively high expectations of what a company can achieve in the future. When earnings fall, the 'E' decreases, over time. That means unless the share price falls, the P/E will increase in a few years. So while a stock may look cheap based on past earnings, it could be expensive based on future earnings. Oxford Metrics's earnings made like a rocket, taking off 86% last year. The sweetener is that the annual five year growth rate of 57% is also impressive. So I'd be surprised if the P/E ratio wasnotabove average. Unfortunately, earnings per share are down 13% a year, over 3 years. The P/E ratio essentially measures market expectations of a company. If you look at the image below, you can see Oxford Metrics has a lower P/E than the average (29.8) in the software industry classification. This suggests that market participants think Oxford Metrics will underperform other companies in its industry. Many investors like to buy stocks when the market is pessimistic about their prospects. If you consider the stock interesting, further research is recommended. For example, I often monitordirector buying and selling. Don't forget that the P/E ratio considers market capitalization. So it won't reflect the advantage of cash, or disadvantage of debt. Hypothetically, a company could reduce its future P/E ratio by spending its cash (or taking on debt) to achieve higher earnings. Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context. Since Oxford Metrics holds net cash of UK£11m, it can spend on growth, justifying a higher P/E ratio than otherwise. Oxford Metrics's P/E is 27.1 which is above average (16.3) in the GB market. Its net cash position is the cherry on top of its superb EPS growth. So based on this analysis we'd expect Oxford Metrics to have a high P/E ratio. When the market is wrong about a stock, it gives savvy investors an opportunity. If the reality for a company is better than it expects, you can make money by buying and holding for the long term. So thisfreevisual report on analyst forecastscould hold the key to an excellent investment decision. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Renewed Ransomware Menace Hits Georgia Court System Ransomware, which recently totallydisrupted the government in Baltimore, has nowovertaken a court system in Georgia. After receiving a ransom note, officials in Georgia decided to take a system offline to be safe. Bruce Shaw, an official with the state court system, said: “Our systems have been compromised, so we have quarantined our servers and shut off our network to the outside. We haven’t figured that out yet, we would love to. It could be a matter of opportunity, I think.” In this case, no private information would have been compromised. The system could have been sacrificed if need be, but after receiving the note, officials reacted with haste. Taking the system offline gives them a fighting chance to rid it of malware and potentially guard against future attacks. There are numerous ways for a computer system to become infected, including e-mail phishing attacks and malware from browsing the internet. Read the full story on CCN.com.
A Look At The Intrinsic Value Of Talenom Oyj (HEL:TNOM) Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! How far off is Talenom Oyj (HEL:TNOM) from its intrinsic value? Using the most recent financial data, we'll take a look at whether the stock is fairly priced by estimating the company's future cash flows and discounting them to their present value. I will be using the Discounted Cash Flow (DCF) model. It may sound complicated, but actually it is quite simple! Companies can be valued in a lot of ways, so we would point out that a DCF is not perfect for every situation. Anyone interested in learning a bit more about intrinsic value should have a read of theSimply Wall St analysis model. Check out our latest analysis for Talenom Oyj We use what is known as a 2-stage model, which simply means we have two different periods of growth rates for the company's cash flows. Generally the first stage is higher growth, and the second stage is a lower growth phase. To start off with, we need to estimate the next ten years of cash flows. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. Generally we assume that a dollar today is more valuable than a dollar in the future, so we discount the value of these future cash flows to their estimated value in today's dollars: [{"": "Levered FCF (\u20ac, Millions)", "2020": "\u20ac7.2m", "2021": "\u20ac9.6m", "2022": "\u20ac11.6m", "2023": "\u20ac12.1m", "2024": "\u20ac12.5m", "2025": "\u20ac12.8m", "2026": "\u20ac13.0m", "2027": "\u20ac13.2m", "2028": "\u20ac13.3m", "2029": "\u20ac13.5m"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x2", "2021": "Analyst x2", "2022": "Analyst x2", "2023": "Analyst x2", "2024": "Est @ 3.12%", "2025": "Est @ 2.34%", "2026": "Est @ 1.8%", "2027": "Est @ 1.42%", "2028": "Est @ 1.16%", "2029": "Est @ 0.97%"}, {"": "Present Value (\u20ac, Millions) Discounted @ 6.75%", "2020": "\u20ac6.7", "2021": "\u20ac8.4", "2022": "\u20ac9.5", "2023": "\u20ac9.3", "2024": "\u20ac9.0", "2025": "\u20ac8.6", "2026": "\u20ac8.2", "2027": "\u20ac7.8", "2028": "\u20ac7.4", "2029": "\u20ac7.0"}] ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= €82.1m The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (0.5%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 6.7%. Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = €13m × (1 + 0.5%) ÷ (6.7% – 0.5%) = €218m Present Value of Terminal Value (PVTV)= TV / (1 + r)10= €€218m ÷ ( 1 + 6.7%)10= €113.57m The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is €195.66m. To get the intrinsic value per share, we divide this by the total number of shares outstanding.This results in an intrinsic value estimate of €28.08. Relative to the current share price of €33.4, the company appears around fair value at the time of writing. Valuations are imprecise instruments though, rather like a telescope - move a few degrees and end up in a different galaxy. Do keep this in mind. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Talenom Oyj as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 6.7%, which is based on a levered beta of 0.953. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Valuation is only one side of the coin in terms of building your investment thesis, and it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Talenom Oyj, I've compiled three essential factors you should further research: 1. Financial Health: Does TNOM have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Future Earnings: How does TNOM's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart. 3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of TNOM? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the HEL every day. If you want to find the calculation for other stocks justsearch here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Are Dividend Investors Getting More Than They Bargained For With Tullow Oil plc's (LON:TLW) Dividend? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Is Tullow Oil plc (LON:TLW) a good dividend stock? How can we tell? Dividend paying companies with growing earnings can be highly rewarding in the long term. If you are hoping to live on the income from dividends, it's important to be a lot more stringent with your investments than the average punter. A slim 1.8% yield is hard to get excited about, but the long payment history is respectable. At the right price, or with strong growth opportunities, Tullow Oil could have potential. When buying stocks for their dividends, you should always run through the checks below, to see if the dividend looks sustainable. Explore this interactive chart for our latest analysis on Tullow Oil! Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Tullow Oil paid out 79% of its profit as dividends, over the trailing twelve month period. It's paying out most of its earnings, which limits the amount that can be reinvested in the business. This may indicate limited need for further capital within the business, or highlight a commitment to paying a dividend. As Tullow Oil has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A quick check of its financial situation can be done with two ratios: net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and net interest cover. Net debt to EBITDA measures total debt load relative to company earnings (lower = less debt), while net interest cover measures the ability to pay interest on the debt (higher = greater ability to pay interest costs). Tullow Oil has net debt of 3.79 times its EBITDA, which is getting towards the limit of most investors' comfort zones. Judicious use of debt can enhance shareholder returns, but also adds to the risk if something goes awry. Net interest cover can be calculated by dividing earnings before interest and tax (EBIT) by the company's net interest expense. Interest cover of 1.00 times its interest expense is starting to become a concern for Tullow Oil, and be aware that lenders may place additional restrictions on the company as well. Consider gettingour latest analysis on Tullow Oil's financial position here. From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. For the purpose of this article, we only scrutinise the last decade of Tullow Oil's dividend payments. During the past ten-year period, the first annual payment was US$0.082 in 2009, compared to US$0.048 last year. The dividend has shrunk at around 5.2% a year during that period. A shrinking dividend over a ten-year period is not ideal, and we'd be concerned about investing in a dividend stock that lacks a solid record of growing dividends per share. The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. It's not great to see that Tullow Oil's have fallen at approximately 20% over the past five years. If earnings continue to decline, the dividend may come under pressure. Every investor should make an assessment of whether the company is taking steps to stabilise the situation. Dividend investors should always want to know if a) a company's dividends are affordable, b) if there is a track record of consistent payments, and c) if the dividend is capable of growing. Tullow Oil's payout ratios are within a normal range for the average corporation, and we like that its cashflow was stronger than reported profits. Earnings per share are down, and Tullow Oil's dividend has been cut at least once in the past, which is disappointing. Ultimately, Tullow Oil comes up short on our dividend analysis. It's not that we think it is a bad company - just that there are likely more appealing dividend prospects out there on this analysis. Without at least some growth in earnings per share over time, the dividend will eventually come under pressure either from costs or inflation. See if the 16 analysts are forecasting a turnaround in ourfree collection of analyst estimates here. Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Asian Shares Lower, but Australian Market Bucks the Trend The major Asian stock indexes are down across the board on Wednesday, but shares are higher in Australia. Asian investors are worried about global trade concerns, while Australian investors seem to be pleased with their central bank’s monetary policy decisions. The early price action indicates the euphoria from the weekend announcement of renewed trade talks between the United States and China appears to have worn off. At 06:03 GMT, Japan’s Nikkei 225 Index is trading 21608.66, down 145.61 or -0.67%. Hong Kong’s Hang Seng Index is at 28788.49, down 87.07 or -0.30% and South Korea’s KOSPI is trading 2095.57, down 26.45 or -1.25%. China’s Shanghai Index is trading 3017.89, down 26.06 or -0.86% and Australia’s S&P/ASX 200 Index is at 6685.10, up 31.90 or +0.48%. Concerns Over U.S. Trade Policy Driving the Action Concerns over U.S. trade policy may have only capped gains in the United States on Tuesday, but they’re pressuring stocks in Asia and likely to lean on European stocks. Offsetting the optimism surrounding the Trump-Xi trade truce is a threat by the U.S. government on Monday to impose tariffs on $4 billion of additional European goods in a long-running dispute over aircraft subsidies. The new threat is telling investors that there may be no end in sight to the trade disputes and that any thoughts that the resumption of trade talks between the U.S. and China helped eliminate the Fed’s uncertainties have been erased. Australia Outshines Asian Markets Shares in Australia are being boosted by the Reserve Bank of Australia’s (RBA) decision to cut interest rates for the second consecutive month. This places rates at an historic low. After the announcement Governor Lowe said that the bank will now wait and “monitor developments in the labor market closely and adjust monetary Policy if needed”. Higher commodity prices are also providing support for the Australian stock market. They are being driven by rapidly rising iron ore prices. They rose to a fresh five-year high on Tuesday. The rally is being fueled by stronger Chinese steel demand and lower supply from the largest producers, Brazil and Australia. The news is helping to boost shares of miner stocks. Story continues While the broad-based index may be rising, banking shares are trending lower on fears of stricter lending policies. Furthermore, lower interest rates tend to reduce the profits of banks. This article was originally posted on FX Empire More From FXEMPIRE: Gold Consolidates Ahead US Employment Report; Trump Tweets Again Palladium Sets Up Another Double Top Pattern USD/CAD Daily Forecast – Overhead Ichimoku Clouds Deterring the Upside Actions GBP/USD Price Forecast – British pound shows weakness again during holiday Bitcoin Tech Analysis – Recap and Mid-Day Review – 04/07/19 AUD/USD Price Forecast – Australian dollar stalls on thin holiday trading
Did Tokmanni Group Oyj (HEL:TOKMAN) Use Debt To Deliver Its ROE Of 20%? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. By way of learning-by-doing, we'll look at ROE to gain a better understanding of Tokmanni Group Oyj (HEL:TOKMAN). Our data showsTokmanni Group Oyj has a return on equity of 20%for the last year. One way to conceptualize this, is that for each €1 of shareholders' equity it has, the company made €0.20 in profit. View our latest analysis for Tokmanni Group Oyj Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Tokmanni Group Oyj: 20% = €35m ÷ €175m (Based on the trailing twelve months to March 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is the capital paid in by shareholders, plus any retained earnings. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets. ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, all else being equal,a high ROE is better than a low one. That means it can be interesting to compare the ROE of different companies. Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. You can see in the graphic below that Tokmanni Group Oyj has an ROE that is fairly close to the average for the Multiline Retail industry (20%). That's not overly surprising. ROE tells us about the quality of the business, but it does not give us much of an idea if the share price is cheap. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket. Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the use of debt will improve the returns, but will not change the equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Tokmanni Group Oyj clearly uses a significant amount of debt to boost returns, as it has a debt to equity ratio of 1.03. There's no doubt the ROE is respectable, but it's worth keeping in mind that metric is elevated by the use of debt. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have the same ROE, then I would generally prefer the one with less debt. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company. Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Topdanmark A/S's (CPH:TOP) 23% ROE Better Than Average? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine Topdanmark A/S (CPH:TOP), by way of a worked example. Over the last twelve monthsTopdanmark has recorded a ROE of 23%. One way to conceptualize this, is that for each DKK1 of shareholders' equity it has, the company made DKK0.23 in profit. Check out our latest analysis for Topdanmark Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Topdanmark: 23% = ø1.5b ÷ ø6.5b (Based on the trailing twelve months to March 2019.) Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all the money paid into the company from shareholders, plus any earnings retained. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets. ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the yearly profit. That means that the higher the ROE, the more profitable the company is. So, all else being equal,a high ROE is better than a low one. That means ROE can be used to compare two businesses. By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. As you can see in the graphic below, Topdanmark has a higher ROE than the average (9.3%) in the Insurance industry. That is a good sign. In my book, a high ROE almost always warrants a closer look. For exampleyou might checkif insiders are buying shares. Companies usually need to invest money to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. Although Topdanmark does use debt, its debt to equity ratio of 0.40 is still low. Its ROE is very impressive, and given only modest debt, this suggests the business is high quality. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities. Return on equity is useful for comparing the quality of different businesses. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt. But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreereport on analyst forecasts for the company. But note:Topdanmark may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Does Teleste Corporation's (HEL:TLT1V) Balance Sheet Tell Us About It? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Investors are always looking for growth in small-cap stocks like Teleste Corporation (HEL:TLT1V), with a market cap of €107m. However, an important fact which most ignore is: how financially healthy is the business? Assessing first and foremost the financial health is essential, as mismanagement of capital can lead to bankruptcies, which occur at a higher rate for small-caps. Let's work through some financial health checks you may wish to consider if you're interested in this stock. However, this is not a comprehensive overview, so I recommend youdig deeper yourself into TLT1V here. Over the past year, TLT1V has maintained its debt levels at around €33m – this includes long-term debt. At this stable level of debt, TLT1V's cash and short-term investments stands at €18m to keep the business going. Moreover, TLT1V has generated cash from operations of €11m over the same time period, resulting in an operating cash to total debt ratio of 34%, indicating that TLT1V’s current level of operating cash is high enough to cover debt. At the current liabilities level of €65m, it seems that the business has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.6x. The current ratio is the number you get when you divide current assets by current liabilities. For Communications companies, this ratio is within a sensible range since there is a bit of a cash buffer without leaving too much capital in a low-return environment. With a debt-to-equity ratio of 46%, TLT1V can be considered as an above-average leveraged company. This is a bit unusual for a small-cap stock, since they generally have a harder time borrowing than large more established companies. We can check to see whether TLT1V is able to meet its debt obligations by looking at the net interest coverage ratio. A company generating earnings before interest and tax (EBIT) at least three times its net interest payments is considered financially sound. In TLT1V's, case, the ratio of 59.28x suggests that interest is comfortably covered, which means that debtors may be willing to loan the company more money, giving TLT1V ample headroom to grow its debt facilities. TLT1V’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow. Since there is also no concerns around TLT1V's liquidity needs, this may be its optimal capital structure for the time being. Keep in mind I haven't considered other factors such as how TLT1V has been performing in the past. I suggest you continue to research Teleste to get a more holistic view of the small-cap by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for TLT1V’s future growth? Take a look at ourfree research report of analyst consensusfor TLT1V’s outlook. 2. Valuation: What is TLT1V worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether TLT1V is currently mispriced by the market. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is There Now An Opportunity In MGI Digital Technology Société Anonyme (EPA:ALMDG)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! MGI Digital Technology Société Anonyme (EPA:ALMDG), which is in the tech business, and is based in France, saw a decent share price growth in the teens level on the ENXTPA over the last few months. As a small cap stock, hardly covered by any analysts, there is generally more of an opportunity for mispricing as there is less activity to push the stock closer to fair value. Is there still an opportunity here to buy? Let’s take a look at MGI Digital Technology Société Anonyme’s outlook and value based on the most recent financial data to see if the opportunity still exists. View our latest analysis for MGI Digital Technology Société Anonyme According to my relative valuation model, the stock seems to be currently fairly priced. I’ve used the price-to-earnings ratio in this instance because there’s not enough visibility to forecast its cash flows. The stock’s ratio of 22.12x is currently trading in-line with its industry peers’ ratio, which means if you buy MGI Digital Technology Société Anonyme today, you’d be paying a relatively reasonable price for it. Furthermore, it seems like MGI Digital Technology Société Anonyme’s share price is quite stable, which means there may be less chances to buy low in the future now that it’s fairly valued. This is because the stock is less volatile than the wider market given its low beta. Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to grow by 73% over the next couple of years, the future seems bright for MGI Digital Technology Société Anonyme. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation. Are you a shareholder?It seems like the market has already priced in ALMDG’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the track record of its management team. Have these factors changed since the last time you looked at ALMDG? Will you have enough confidence to invest in the company should the price drop below its fair value? Are you a potential investor?If you’ve been keeping tabs on ALMDG, now may not be the most advantageous time to buy, given it is trading around its fair value. However, the optimistic forecast is encouraging for ALMDG, which means it’s worth diving deeper into other factors such as the strength of its balance sheet, in order to take advantage of the next price drop. Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on MGI Digital Technology Société Anonyme. You can find everything you need to know about MGI Digital Technology Société Anonyme inthe latest infographic research report. If you are no longer interested in MGI Digital Technology Société Anonyme, you can use our free platform to see my list of over50 other stocks with a high growth potential. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
TransCanna To Provide Corporate Update on Conference Call Vancouver, British Columbia--(Newsfile Corp. - July 3, 2019) -TransCanna Holdings Inc.(CSE: TCAN) (OTC PINK: TCNAF) (FSE: TH8) ("TransCanna" or the "Company") will be providing a corporate update to its shareholders and investors on Wednesday, July 3rd at 1:15pm PST. The call in numbers are (US) 888-585-9008, (Canada) (888) 299-2873 and (Germany) 0 800 723 5123. The Conference room pin is 477 995 281. TransCanna management will discuss the progress of the proposed acquisitions involving GoodFellas, Soldaze, Lyfted Farms and Biovelle, as well as a general update on the licensing process for the 196,000 sq ft facility in Modesto, CA and the 10,000 sq ft facility in Adelanto, CA. For further information, please visit the Company's website atwww.transcanna.com About TransCanna Holdings Inc. TransCanna Holdings Inc. is a Canadian-based company focused on providing integrated branding, transportation and distribution services, through its wholly-owned California subsidiaries, to a range of industries including the cannabis marketplace. For further information, please visit the Company's website atwww.transcanna.comor email the Company [email protected]. Media [email protected] On behalf of the Board of Directors James PakulisChief Executive OfficerTelephone: (604) 609-6199 The information in this news release includes certain information and statements about management's view of future events, expectations, plans and prospects that constitute forward looking statements. These statements are based upon assumptions that are subject to significant risks and uncertainties. Because of these risks and uncertainties and as a result of a variety of factors, the actual results, expectations, achievements or performance may differ materially from those anticipated and indicated by these forward looking statements. Any number of factors could cause actual results to differ materially from these forward-looking statements as well as future results. Although the Company believes that the expectations reflected in forward looking statements are reasonable, it can give no assurances that the expectations of any forward looking statements will prove to be correct. Except as required by law, the Company disclaims any intention and assumes no obligation to update or revise any forward looking statements to reflect actual results, whether as a result of new information, future events, changes in assumptions, changes in factors affecting such forward looking statements or otherwise. Neither the Canadian Securities Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Canadian Securities Exchange) accepts responsibility for the adequacy or accuracy of this release. To view the source version of this press release, please visithttps://www.newsfilecorp.com/release/46056
Where Ercros, S.A.'s (BME:ECR) Earnings Growth Stands Against Its Industry Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Improvement in profitability and outperformance against the industry can be important characteristics in a stock for some investors. Below, I will assess Ercros, S.A.'s (BME:ECR) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. See our latest analysis for Ercros ECR's trailing twelve-month earnings (from 31 March 2019) of €39m has declined by -12% compared to the previous year. Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 47%, indicating the rate at which ECR is growing has slowed down. Why is this? Well, let’s take a look at what’s going on with margins and whether the entire industry is feeling the heat. In terms of returns from investment, Ercros has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 7.7% exceeds the ES Chemicals industry of 5.8%, indicating Ercros has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Ercros’s debt level, has declined over the past 3 years from 13% to 6.8%. While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors impacting its business. I suggest you continue to research Ercros to get a better picture of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for ECR’s future growth? Take a look at ourfree research report of analyst consensusfor ECR’s outlook. 2. Financial Health: Are ECR’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Here's What Alkali Metals Limited's (NSE:ALKALI) P/E Is Telling Us Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today, we'll introduce the concept of the P/E ratio for those who are learning about investing. We'll show how you can use Alkali Metals Limited's (NSE:ALKALI) P/E ratio to inform your assessment of the investment opportunity. Looking at earnings over the last twelve months,Alkali Metals has a P/E ratio of 22.43. In other words, at today's prices, investors are paying ₹22.43 for every ₹1 in prior year profit. View our latest analysis for Alkali Metals Theformula for P/Eis: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Alkali Metals: P/E of 22.43 = ₹41.5 ÷ ₹1.85 (Based on the year to March 2019.) The higher the P/E ratio, the higher the price tag of a business, relative to its trailing earnings. That is not a good or a bad thingper se, but a high P/E does imply buyers are optimistic about the future. Companies that shrink earnings per share quickly will rapidly decrease the 'E' in the equation. That means even if the current P/E is low, it will increase over time if the share price stays flat. So while a stock may look cheap based on past earnings, it could be expensive based on future earnings. Notably, Alkali Metals grew EPS by a whopping 44% in the last year. Unfortunately, earnings per share are down 5.8% a year, over 3 years. We can get an indication of market expectations by looking at the P/E ratio. You can see in the image below that the average P/E (13.6) for companies in the chemicals industry is lower than Alkali Metals's P/E. Its relatively high P/E ratio indicates that Alkali Metals shareholders think it will perform better than other companies in its industry classification. Clearly the market expects growth, but it isn't guaranteed. So further research is always essential. I often monitordirector buying and selling. The 'Price' in P/E reflects the market capitalization of the company. So it won't reflect the advantage of cash, or disadvantage of debt. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth. While growth expenditure doesn't always pay off, the point is that it is a good option to have; but one that the P/E ratio ignores. Alkali Metals has net debt equal to 41% of its market cap. While that's enough to warrant consideration, it doesn't really concern us. Alkali Metals has a P/E of 22.4. That's higher than the average in the IN market, which is 15.3. The company is not overly constrained by its modest debt levels, and its recent EPS growth is nothing short of stand-out. So to be frank we are not surprised it has a high P/E ratio. When the market is wrong about a stock, it gives savvy investors an opportunity. As value investor Benjamin Graham famously said, 'In the short run, the market is a voting machine but in the long run, it is a weighing machine.' We don't have analyst forecasts, but shareholders might want to examinethis detailed historical graphof earnings, revenue and cash flow. But note:Alkali Metals may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
How the Trump administration's 2018 trade aid package works MINNEAPOLIS (AP) The Trump administration's Market Facilitation Program is meant to compensate farmers for income they've lost due to the U.S. trade war with China . Data provided to The Associated Press from the U.S. Department of Agriculture under the Freedom of Information Act gives some insights into where the money goes. Here's how the program works: Farmers didn't have to prove their losses on their 2019 crops and livestock, just their production. The program sets a $125,000 cap in each of three categories of commodities: one for soybeans and other row crops, one for pork and dairy, and one for cherries and almonds. Farmers can claim payments in more than one category. Individual farmers who produce both soybeans and hogs, for example, could collect up to $250,000 if their production of each was high enough. Older, bigger farm subsidy programs also contain $125,000 caps with similar ways to get around them. Large-scale farming operations do that by structuring themselves as partnerships, in which each family member or "legal entity" gets their own cap. USDA rules specify that each member must be "actively engaged in farming," but the rules are vague, said Anne Weir Schechinger, senior economic analyst at the Environmental Working Group, which has long tracked where subsidies go and has been studying similar data on the program it obtained through its own open records request. Many relatives are exempt from the "actively engaged" requirement including parents, spouses, siblings and children who can each qualify for their own $125,000 cap. First cousins, nieces and nephews were added to the list in the 2018 farm bill. "When the Trump administration created the MFP they did not have to apply the same broken rules to MFP payments that they had applied to other payments," said Scott Faber, senior vice president of government affairs at the group. "The administration could have chosen to say we're going to have a 125,000 dollar cap with no loopholes, and we're going to have a real means test to ensure that millionaires and billionaires aren't receiving trade bailout payments." Story continues But farm law attorney Robert Serio of Clarendon, Arkansas, whose business is focused on helping large farming operations structure themselves to maximize their ability to collect federal farm subsidies, called payment limits "pure political nonsense." If the purpose of the program is to compensate farms for their losses caused by the government's trade policies, he said, it shouldn't make a difference whether a farm is large or small. USDA data provided to AP through May 31 show that nearly 578,000 Market Facilitation Program applicants had received aid payments, with 83% of the dollars $7 billion going to soybean producers. The second most-subsidized commodity under the program was cotton, nearly 6% of the total at $480 million. Most payments were not large. The average for soybeans was $16,976; for cotton, $13,637; and for corn, $385. But the averages were pushed up by a number of high payments. The median payments paint a better picture of what most farmers got because half got more and half got less. They were $6,438 for soybeans, $3,194 for cotton and $152 for corn. Nearly 60,000 applicants received less than $200, while nearly 5,000 received less than $10. Five states all top soybean producers accounted for nearly half the total payments: Illinois, Iowa, Minnesota, Nebraska and Indiana. The data also show that 91% of the payments, or $7.7 billion, went to counties that Trump carried in the 2016 election not surprising since Trump fared much better in rural America than in urban areas. For row crops the payments ranged from $1.65 per bushel for soybeans to 14 cents per bushel for wheat, to just 1 cent per bushel for corn. Other payments were $8 per head for hogs and 12 cents per hundredweight for milk. Details of who will qualify for payments under the $16 billion 2019 edition of the Market Facilitation Program have not been announced. ___ Associated Press reporters Balint Szalai and Riin Aljas contributed to this story from Washington.
What Kind Of Shareholders Own Mota-Engil, SGPS, S.A. (ELI:EGL)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! A look at the shareholders of Mota-Engil, SGPS, S.A. (ELI:EGL) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.' Mota-Engil SGPS is a smaller company with a market capitalization of €438m, so it may still be flying under the radar of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let's take a closer look to see what the different types of shareholder can tell us about EGL. Check out our latest analysis for Mota-Engil SGPS Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. As you can see, institutional investors own 16% of Mota-Engil SGPS. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Mota-Engil SGPS's earnings history, below. Of course, the future is what really matters. Mota-Engil SGPS is not owned by hedge funds. Quite a few analysts cover the stock, so you could look into forecast growth quite easily. The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO. Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances. I can report that insiders do own shares in Mota-Engil, SGPS, S.A.. It has a market capitalization of just €438m, and insiders have €33m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checkingif those insiders have been selling. The general public holds a 17% stake in EGL. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders. It seems that Private Companies own 59%, of the EGL stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company. I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. I like to dive deeperinto how a company has performed in the past. You can accessthisinteractive graphof past earnings, revenue and cash flow, for free. Ultimatelythe future is most important. You can access thisfreereport on analyst forecasts for the company. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Do You Know What Banco Products (India) Limited's (NSE:BANCOINDIA) P/E Ratio Means? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today, we'll introduce the concept of the P/E ratio for those who are learning about investing. We'll show how you can use Banco Products (India) Limited's (NSE:BANCOINDIA) P/E ratio to inform your assessment of the investment opportunity.What is Banco Products (India)'s P/E ratio?Well, based on the last twelve months it is 10.29. That means that at current prices, buyers pay ₹10.29 for every ₹1 in trailing yearly profits. Check out our latest analysis for Banco Products (India) Theformula for price to earningsis: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for Banco Products (India): P/E of 10.29 = ₹119.85 ÷ ₹11.65 (Based on the trailing twelve months to March 2019.) A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. All else being equal, it's better to pay a low price -- but as Warren Buffett said, 'It's far better to buy a wonderful company at a fair price than a fair company at a wonderful price.' If earnings fall then in the future the 'E' will be lower. That means unless the share price falls, the P/E will increase in a few years. Then, a higher P/E might scare off shareholders, pushing the share price down. Banco Products (India) saw earnings per share decrease by 29% last year. And over the longer term (5 years) earnings per share have decreased 1.5% annually. This growth rate might warrant a below average P/E ratio. We can get an indication of market expectations by looking at the P/E ratio. If you look at the image below, you can see Banco Products (India) has a lower P/E than the average (14.8) in the auto components industry classification. Its relatively low P/E ratio indicates that Banco Products (India) shareholders think it will struggle to do as well as other companies in its industry classification. Many investors like to buy stocks when the market is pessimistic about their prospects. It is arguably worth checkingif insiders are buying shares, because that might imply they believe the stock is undervalued. It's important to note that the P/E ratio considers the market capitalization, not the enterprise value. So it won't reflect the advantage of cash, or disadvantage of debt. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth. Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof). With net cash of ₹1.4b, Banco Products (India) has a very strong balance sheet, which may be important for its business. Having said that, at 17% of its market capitalization the cash hoard would contribute towards a higher P/E ratio. Banco Products (India)'s P/E is 10.3 which is below average (15.3) in the IN market. The recent drop in earnings per share would almost certainly temper expectations, the relatively strong balance sheet will allow the company time to invest in growth. If it achieves that, then there's real potential that the low P/E could eventually indicate undervaluation. When the market is wrong about a stock, it gives savvy investors an opportunity. If the reality for a company is not as bad as the P/E ratio indicates, then the share price should increase as the market realizes this. Although we don't have analyst forecasts, you could get a better understanding of its growth by checking outthis more detailed historical graphof earnings, revenue and cash flow. You might be able to find a better buy than Banco Products (India). If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Elanders AB (publ) (STO:ELAN B) An Attractive Dividend Stock? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Could Elanders AB (publ) (STO:ELAN B) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. Yet sometimes, investors buy a stock for its dividend and lose money because the share price falls by more than they earned in dividend payments. In this case, Elanders likely looks attractive to dividend investors, given its 3.2% dividend yield and seven-year payment history. We'd agree the yield does look enticing. Some simple analysis can reduce the risk of holding Elanders for its dividend, and we'll focus on the most important aspects below. Click the interactive chart for our full dividend analysis Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. Looking at the data, we can see that 38% of Elanders's profits were paid out as dividends in the last 12 months. A medium payout ratio strikes a good balance between paying dividends, and keeping enough back to invest in the business. Besides, if reinvestment opportunities dry up, the company has room to increase the dividend. In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. Elanders's cash payout ratio last year was 13%, which is quite low and suggests that the dividend was thoroughly covered by cash flow. It's positive to see that Elanders's dividend is covered by both profits and cash flow, since this is generally a sign that the dividend is sustainable, and a lower payout ratio usually suggests a greater margin of safety before the dividend gets cut. As Elanders has a meaningful amount of debt, we need to check its balance sheet to see if the company might have debt risks. A rough way to check this is with these two simple ratios: a) net debt divided by EBITDA (earnings before interest, tax, depreciation and amortisation), and b) net interest cover. Net debt to EBITDA measures total debt load relative to company earnings (lower = less debt), while net interest cover measures the ability to pay interest on the debt (higher = greater ability to pay interest costs). With net debt of 5.83 times its EBITDA, Elanders could be described as a highly leveraged company. While some companies can handle this level of leverage, we'd be concerned about the dividend sustainability if there was any risk of an earnings downturn. We calculated its interest cover by measuring its earnings before interest and tax (EBIT), and dividing this by the company's net interest expense. Interest cover of 4.88 times its interest expense is starting to become a concern for Elanders, and be aware that lenders may place additional restrictions on the company as well. Low interest cover and high debt can create problems right when the investor least needs them, and we're reluctant to rely on the dividend of companies with these traits. Remember, you can always get a snapshot of Elanders's latest financial position,by checking our visualisation of its financial health. Before buying a stock for its income, we want to see if the dividends have been stable in the past, and if the company has a track record of maintaining its dividend. Elanders has been paying a dividend for the past seven years. During the past seven-year period, the first annual payment was kr0.50 in 2012, compared to kr2.90 last year. Dividends per share have grown at approximately 29% per year over this time. The dividend has been growing pretty quickly, which could be enough to get us interested even though the dividend history is relatively short. Further research may be warranted. Examining whether the dividend is affordable and stable is important. However, it's also important to assess if earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. Strong earnings per share (EPS) growth might encourage our interest in the company despite fluctuating dividends, which is why it's great to see Elanders has grown its earnings per share at 20% per annum over the past five years. A company paying out less than a quarter of its earnings as dividends, and growing earnings at more than 10% per annum, looks to be right in the cusp of its growth phase. At the right price, we might be interested. When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. It's great to see that Elanders is paying out a low percentage of its earnings and cash flow. Next, earnings growth has been good, but unfortunately the company has not been paying dividends as long as we'd like. Overall we think Elanders scores well on our analysis. It's not quite perfect, but we'd definitely be keen to take a closer look. Now, if you want to look closer, it would be worth checking out ourfreeresearch on Elandersmanagement tenure, salary, and performance. Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
India's budget likely to hike spending to combat slumping growth By Manoj Kumar and Aftab Ahmed NEW DELHI (Reuters) - Prime Minister Narendra Modi's government on Friday will unveil a budget that is expected to cut taxes on business and raise spending in a bid to shore up consumption and faltering economic growth. Analysts say Modi, boosted by a sweeping election victory, hopes to use the budget to restart reforms and deal with a series of economic woes. In January-March, annual growth slumped to 5.8%, the slowest pace in 20 quarters. Growth for the financial year that ended in March was 6.8%, also a five-year low, and indicators such as plummeting industrial output and automobile sales have stoked fears of a deeper slowdown. A shortfall in monsoon rains, pivotal for the farm sector that employs nearly half of India's workers, has increased concerns of rural distress and strengthened the case for intervention, a leader of Modi's ruling Bharatiya Janata Party (BJP) said. "The focus of the budget will be to boost domestic consumption, address the rural crisis and support small manufacturers," Gopal Krishna Agarwal, BJP's economic affairs spokesman, told Reuters. Shilan Shah at Capital Economics in Singapore said in a note "Given the recent economic slowdown, the finance minister is likely to announce more accommodative tax and spending measures." In February, then-Finance Minister Piyush Goyal presented an interim budget for the year beginning April 1, to maintain government functions while a weeks-long election was under way. BIG INVESTMENT PLANS On Friday, new minister Nirmala Sitharaman will present a full-year budget that Agarwal said could lower corporate taxes for small and medium-sized businesses as well as personal ones to revive consumption by the middle class that gave Modi a second term, while withdrawing some tax exemptions. In 2018, Indian government reduced the corporate tax rate to 25% from 30% for companies with annual turnover of 2.5 billion Indian rupees ($36.3 million) or less. Following election promises, the government could present a plan for investing up to 100 trillion rupees ($1.45 trillion) on highways, railways and ports while budgeting another 25 trillion rupees for increasing farm productivity over five years, BJP officials said. To meet the funds required for all that, Sitharaman may need to increase February's 3.4% target for fiscal deficit to gross domestic product to 3.6%, said a senior government official. A Reuters poll showed economists expected a 3.5% target. Sitharaman is also likely to seek a higher dividend from the central bank, draw up plans to raise funds from a 5G telecom auction and propose more privatisation, sources said. After becoming prime minister in 2014, Modi improved public finances, trimming the fiscal deficit to 3.4% from 4.5% in 2013/14, mostly through cuts in subsidies and higher retail taxes on fuel. However, he is now under pressure to loosen the purse strings to meet election promises and jack up the growth rate. FALLING RURAL DEMAND "A large part of the economy is facing a recession with a fall in rural demand and private investments," said Ashwani Mahajan, chief of the economic wing of the Rashtriya Swayamsevak Sangh, the ideological parent of Modi's ruling group. "It is the right time to expand the fiscal deficit up to 4% of GDP," he said adding the budget could provide tax incentives for food processing, logistics and small businesses as well as affordable housing. Private investment in India rose an annual 7.2% in January-March, down from 8.4% the previous quarter. Capital investment growth slowed to 3.6% from 10.6%. Economists expect spending to rise as the government plans to expand cash benefits to farmers and inject more funds into state-run banks - saddled with nearly $150 billion stressed assets - to support lending. Modi has set an ambitious target of turning India into a $5 trillion in the next five years from $2.7 trillion, which will require an annual growth rate of over 10%, economists said. But that will require a big second wave of reforms that Modi shied from during his first term, economists say. To unlock potential and growth more robustly, in their view, India needs to make land acquisition easier and amend labour laws that make hiring and firing of workers difficult. BJP's Agarwal says the budget speech "will lay a roadmap of economic reforms for the next five years, with an objective of boosting economic growth." ($1 = 68.86 Indian rupees) (Reporting by Aftab Ahmed and Manoj Kumar; Editing by Sanjeev Miglani and Richard Borsuk)
How Good Is ELES Semiconductor Equipment S.p.A. (BIT:ELES), When It Comes To ROE? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! One of the best investments we can make is in our own knowledge and skill set. With that in mind, this article will work through how we can use Return On Equity (ROE) to better understand a business. We'll use ROE to examine ELES Semiconductor Equipment S.p.A. (BIT:ELES), by way of a worked example. ELES Semiconductor Equipment has a ROE of 12%, based on the last twelve months. That means that for every €1 worth of shareholders' equity, it generated €0.12 in profit. View our latest analysis for ELES Semiconductor Equipment Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for ELES Semiconductor Equipment: 12% = €740k ÷ €6.4m (Based on the trailing twelve months to March 2019.) It's easy to understand the 'net profit' part of that equation, but 'shareholders' equity' requires further explanation. It is all the money paid into the company from shareholders, plus any earnings retained. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company. Return on Equity measures a company's profitability against the profit it has kept for the business (plus any capital injections). The 'return' is the profit over the last twelve months. A higher profit will lead to a higher ROE. So, as a general rule,a high ROE is a good thing. Clearly, then, one can use ROE to compare different companies. By comparing a company's ROE with its industry average, we can get a quick measure of how good it is. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. The image below shows that ELES Semiconductor Equipment has an ROE that is roughly in line with the Semiconductor industry average (11%). That isn't amazing, but it is respectable. ROE can give us a view about company quality, but many investors also look to other factors, such as whether there are insiders buying shares. If you are like me, then you willnotwant to miss thisfreelist of growing companies that insiders are buying. Virtually all companies need money to invest in the business, to grow profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. It's worth noting the significant use of debt by ELES Semiconductor Equipment, leading to its debt to equity ratio of 1.41. while its ROE is respectable, it is worth keeping in mind that there is usually a limit to how much debt a company can use. Debt does bring extra risk, so it's only really worthwhile when a company generates some decent returns from it. Return on equity is one way we can compare the business quality of different companies. In my book the highest quality companies have high return on equity, despite low debt. If two companies have the same ROE, then I would generally prefer the one with less debt. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So I think it may be worth checking thisfreethisdetailed graphof past earnings, revenue and cash flow. If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Serco electronic tagging scandal: firm fined by UK watchdog A Serco flag is seen flying alongside a Union flag outside Doncaster Prison. Photo: Darren Staples/Reuters Outsourcing giant Serco has been fined £19.2m by the Serious Fraud Office (SFO) over the electronic tagging scandal. The firm’s UK subsidiary Serco Geografix admitted responsibility for three offences of fraud and two of false accounting for understating its profits from government contracts. The scandal came after a government audit found outsourcing firms had billed the taxpayer to tag and monitor prisoners who were never tagged, back in prison, or even dead. The firm also agreed to pay £3.7m in costs as part of a “deferred prosecution agreement” and said on Wednesday it was “mortified” by the scandal over the Ministry of Justice contract. READ MORE: Dad calls for crackdown on online betting ads after son takes own life over his gambling addiction The fine was discounted by 50% by the SFO because Serco reported the offences itself and had cooperated with the investigation. “Serco apologised unreservedly at the time, and we do so again,” Serco’s chief executive Rupert Soames said in a statement. “The management and culture of Serco, and the transparency with which we conduct our affairs, have changed beyond all recognition, and we are pleased that this has been acknowledged by both the SFO and by the government.” The firm has already paid compensation as part of a £70m civil settlement in 2013. Former justice secretary Chris Grayling. Photo: Isabel Infantes/PA Images The investigation, which involves the firm’s behaviour between 2010 and 2013, has now concluded without Serco facing any criminal charges. When then-justice minister Chris Grayling announced a review into the scandal in 2013, the UK government temporarily blocked G4S and Serco from applying for government contracts. The controversy sparked debate over the role of private firms in providing public services, with senior figures at both firms resigning over the scandal. But Soames said the company’s management and culture had now “changed beyond all recognition,” with no one on its board or executive management team at the time still at the firm today.
Here's What Global EcoPower Société Anonyme's (EPA:ALGEP) ROCE Can Tell Us Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we are going to look at Global EcoPower Société Anonyme (EPA:ALGEP) to see whether it might be an attractive investment prospect. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires. First of all, we'll work out how to calculate ROCE. Next, we'll compare it to others in its industry. Last but not least, we'll look at what impact its current liabilities have on its ROCE. ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Author Edwin Whitingsaysto be careful when comparing the ROCE of different businesses, since 'No two businesses are exactly alike.' The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Global EcoPower Société Anonyme: 0.35 = €5.0m ÷ (€42m - €28m) (Based on the trailing twelve months to December 2018.) So,Global EcoPower Société Anonyme has an ROCE of 35%. Check out our latest analysis for Global EcoPower Société Anonyme ROCE can be useful when making comparisons, such as between similar companies. Using our data, we find that Global EcoPower Société Anonyme's ROCE is meaningfully better than the 9.8% average in the Construction industry. We consider this a positive sign, because it suggests it uses capital more efficiently than similar companies. Putting aside its position relative to its industry for now, in absolute terms, Global EcoPower Société Anonyme's ROCE is currently very good. In our analysis, Global EcoPower Société Anonyme's ROCE appears to be 35%, compared to 3 years ago, when its ROCE was 8.5%. This makes us wonder if the company is improving. The image below shows how Global EcoPower Société Anonyme's ROCE compares to its industry, and you can click it to see more detail on its past growth. It is important to remember that ROCE shows past performance, and is not necessarily predictive. ROCE can be deceptive for cyclical businesses, as returns can look incredible in boom times, and terribly low in downturns. ROCE is only a point-in-time measure. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company. Liabilities, such as supplier bills and bank overdrafts, are referred to as current liabilities if they need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets. Global EcoPower Société Anonyme has total liabilities of €28m and total assets of €42m. As a result, its current liabilities are equal to approximately 66% of its total assets. Global EcoPower Société Anonyme's high level of current liabilities boost the ROCE - but its ROCE is still impressive. So we would be interested in doing more research here -- there may be an opportunity! Global EcoPower Société Anonyme looks strong on this analysis,but there are plenty of other companies that could be a good opportunity. Here is afree listof companies growing earnings rapidly. I will like Global EcoPower Société Anonyme better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Safe Haven Assets Restore Gains as Risk Appetite Falters Despite US-China Trade Truce Open your FXTM account today Anxious investors flocked to safe haven assets, sending Gold back above the psychological $1400 level, the Japanese Yen to sub-108 levels against the US Dollar, and yields on 10-year US Treasuries below two percent. Asian stocks are currently lower, while most Asian currencies are gaining against the US Dollar. The feel-good sentiment that followed the Trump-Xi meeting proved fleeting as investors were fed with a slew of manufacturing PMI data that exposed economic shortcomings across Asia and Europe. The threat of more US tariffs on EU goods hasn’t done risk appetite any favours, as tariffs on shipments between the US and China remain in place and continue inflicting damage on the global economy. Downside risks continue to feed into market trepidation that the global economy will experience a steeper-than-expected slowdown. Whether or not policymakers will have enough ammunition to cushion the fall remains to be seen, leaving market optimism hanging by a thread as US-China trade tensions remain the key antagonist to the global growth outlook. The Dollar Index (DXY)is steadying around the 96.7 marks at the time of writing, with Friday’s non-farm payrolls (NFP) data set to trigger the next major move in the Dollar. The June US jobs data, to be announced after the 4th of July holiday, is expected to show 164,000 new jobs being added last month, a marked improvement from May’s dismal 75,000 print. The latest employment data will be used by investors to ascertain how the Federal Reserve will act on its monetary policy setting during its July meeting, even as markets price in a 100 percent chance of a Fed rate cut this month. Should the upcoming US jobs report come in below market expectations, then the path for a larger-than-expected US interest rate cut becomes clearer, potentially allowing Dollar bears the chance to push the Greenback lower. Brentfutures are now up 0.6 percent to trade at $62.78/bbl at the time of writing, while WTI crude is higher by 0.5 percent at $56.55/bbl, slightly blunting Tuesday’s steep drop as US inventories reportedly fell by some five million barrels last week. Oil prices are testing the floor set by the OPEC+ decision to extend its supply cuts through the first quarter of 2020, even as global manufacturing activity contracted for a second straight month in June. Concerns over faltering demand continue to swirl in the markets, exposing Oil’s downside. Investors have yet to buy into the OPEC narrative that keeping the supply cuts at current levels for the next nine months will be enough to rebalance global markets. Disclaimer:The content in this article comprises personal opinions and should not be construed as containing personal and/or other investment advice and/or an offer of and/or solicitation for any transactions in financial instruments and/or a guarantee and/or prediction of future performance. ForexTime (FXTM), its affiliates, agents, directors, officers or employees do not guarantee the accuracy, validity, timeliness or completeness, of any information or data made available and assume no liability as to any loss arising from any investment based on the same. Thisarticlewas originally posted on FX Empire • Crude Oil Price Forecast – Crude oil markets quiet during holiday trading • The Long And Short Plays For Gold Traders • Soybeans Bounced at 8.700 and Turned Positive; Coffee Hits 115.00 • Crazy Time in Bond Land – Buy Everything Part 2 • Can New ECB Head Christine Lagarde Help the EUR? • Investing in a late-cycle Economy
Dah Sing Financial Holdings Limited (HKG:440): What Can We Expect From This High Growth Stock? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Dah Sing Financial Holdings Limited's (HKG:440) latest earnings announcement in April 2019 suggested that the business experienced a robust tailwind, leading to a double-digit earnings growth of 22%. Below, I've laid out key growth figures on how market analysts perceive Dah Sing Financial Holdings's earnings growth outlook over the next few years and whether the future looks even brighter than the past. I will be using net income excluding extraordinary items in order to exclude one-off volatility which I am not interested in. Check out our latest analysis for Dah Sing Financial Holdings Analysts' expectations for next year seems rather subdued, with earnings rising by a single digit 6.7%. The growth outlook in the following year seems much more buoyant with rates generating double digit 24% compared to today’s earnings, and finally hitting HK$2.7b by 2022. While it is useful to understand the growth rate each year relative to today’s figure, it may be more insightful to determine the rate at which the earnings are growing on average every year. The pro of this technique is that it ignores near term flucuations and accounts for the overarching direction of Dah Sing Financial Holdings's earnings trajectory over time, which may be more relevant for long term investors. To calculate this rate, I put a line of best fit through the forecasted earnings by market analysts. The slope of this line is the rate of earnings growth, which in this case is 11%. This means that, we can assume Dah Sing Financial Holdings will grow its earnings by 11% every year for the next couple of years. For Dah Sing Financial Holdings, I've put together three relevant aspects you should look at: 1. Financial Health: Does it have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Valuation: What is 440 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether 440 is currently mispriced by the market. 3. Other High-Growth Alternatives: Are there other high-growth stocks you could be holding instead of 440? Exploreour interactive list of stocks with large growth potentialto get an idea of what else is out there you may be missing! We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Baby of murdered pregnant woman dies four days after she was stabbed A baby that was delivered by paramedics after his pregnant mother was stabbed has died, police have said. Kelly Mary Fauvrelle was stabbed at her home in Thornton Heath, south London, in the early hours of Saturday when she was eight months pregnant. Paramedics managed to deliver her baby son , who her family named Riley, but he died in hospital in the early hours of Wednesday morning, police said. The news came as Scotland Yard as the force released CCTV footage of a man seen walking towards the address before running away from the scene minutes later. Kelly Mary Fauvrelle was stabbed in the early hours of Saturday morning Kelly Mary Fauvrelle Detective Chief Inspector Mick Norman, from the Met's Homicide and Major Crime Command said: "This morning, we heard the sad news that Kelly's baby son, Riley, has died in hospital. Our thoughts remain with their family. "This tragic development makes it even more important that anyone with information comes forward as a matter of urgency. READ MORE New Chinese magnetic levitation train ‘is faster than going by plane’ "We have released footage as the next step in what has been a fast-paced, and extremely challenging investigation. "We need to identify the man shown in the footage urgently, even if only to eliminate him from our inquiries. I need to hear from anyone who knows who he is. "If this is you, it is imperative that you contact my team immediately." In the footage, a man is seen walking towards Ms Fauvrelle's address at 3.11am and running back just over 10 minutes later. Kelly Mary Fauvrelle Scotland Yard have released CCTV footage of a man seen walking towards the address where Kelly Mary Fauvrelle was stabbed before running away from the scene minutes later (Picture: Metropolitan Police/PA Wire) Det Ch Insp Norman said a dedicated team of detectives are working day and night on the investigation but the force is unable to say whether Ms Fauvrelle's attacker was known to her and officers are keeping an open mind. "We have assured Kelly's family - and I want to assure local residents and the wider public too - that we are doing absolutely everything in our power to find the person responsible,” he said, "One of the key aims of my investigation is to build a complete picture of Kelly's life and the people with whom she was in contact, but I also need to consider other possible scenarios. Story continues "Members of the public may have useful information, and I am today reiterating my appeal for anyone who may know anything that will assist the investigation to make contact as soon as possible." Two men have been arrested on suspicion of murder. One, aged 37, was released under investigation on Sunday, and a second, aged 29, has been released on bail until early August. Watch the latest videos from Yahoo UK
Has Elmos Semiconductor AG (ETR:ELG) Improved Earnings Growth In Recent Times? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! For investors with a long-term horizon, examining earnings trend over time and against industry peers is more insightful than looking at an earnings announcement in one point in time. Investors may find my commentary, albeit very high-level and brief, on Elmos Semiconductor AG (ETR:ELG) useful as an attempt to give more color around how Elmos Semiconductor is currently performing. See our latest analysis for Elmos Semiconductor ELG's trailing twelve-month earnings (from 31 March 2019) of €37m has jumped 35% compared to the previous year. Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 19%, indicating the rate at which ELG is growing has accelerated. How has it been able to do this? Let's see whether it is merely due to an industry uplift, or if Elmos Semiconductor has experienced some company-specific growth. In terms of returns from investment, Elmos Semiconductor has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 9.9% exceeds the DE Semiconductor industry of 7.0%, indicating Elmos Semiconductor has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Elmos Semiconductor’s debt level, has increased over the past 3 years from 7.1% to 16%. While past data is useful, it doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Elmos Semiconductor to get a better picture of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for ELG’s future growth? Take a look at ourfree research report of analyst consensusfor ELG’s outlook. 2. Financial Health: Are ELG’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Read This Before Judging Chesnara plc's (LON:CSN) ROE Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). We'll use ROE to examine Chesnara plc (LON:CSN), by way of a worked example. Over the last twelve monthsChesnara has recorded a ROE of 5.4%. Another way to think of that is that for every £1 worth of equity in the company, it was able to earn £0.054. See our latest analysis for Chesnara Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Chesnara: 5.4% = UK£24m ÷ UK£446m (Based on the trailing twelve months to December 2018.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all the money paid into the company from shareholders, plus any earnings retained. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company. ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the amount earned after tax over the last twelve months. The higher the ROE, the more profit the company is making. So, all else equal,investors should like a high ROE. Clearly, then, one can use ROE to compare different companies. One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. Importantly, this is far from a perfect measure, because companies differ significantly within the same industry classification. As is clear from the image below, Chesnara has a lower ROE than the average (16%) in the Insurance industry. That's not what we like to see. We'd prefer see an ROE above the industry average, but it might not matter if the company is undervalued. Nonetheless, it might be wise tocheck if insiders have been selling. Companies usually need to invest money to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used. Although Chesnara does use debt, its debt to equity ratio of 0.29 is still low. I'm not impressed with its ROE, but the debt levels are not too high, indicating the business has decent prospects. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises. Return on equity is one way we can compare the business quality of different companies. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better. But when a business is high quality, the market often bids it up to a price that reflects this. Profit growth rates, versus the expectations reflected in the price of the stock, are a particularly important to consider. So I think it may be worth checking thisfreethisdetailed graphof past earnings, revenue and cash flow. If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
A Closer Look At Elementis plc's (LON:ELM) Uninspiring ROE Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). We'll use ROE to examine Elementis plc (LON:ELM), by way of a worked example. Our data showsElementis has a return on equity of 5.4%for the last year. Another way to think of that is that for every £1 worth of equity in the company, it was able to earn £0.054. See our latest analysis for Elementis Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Elementis: 5.4% = US$50m ÷ US$916m (Based on the trailing twelve months to December 2018.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets. ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the yearly profit. A higher profit will lead to a higher ROE. So, all else being equal,a high ROE is better than a low one. Clearly, then, one can use ROE to compare different companies. One simple way to determine if a company has a good return on equity is to compare it to the average for its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. If you look at the image below, you can see Elementis has a lower ROE than the average (10%) in the Chemicals industry classification. Unfortunately, that's sub-optimal. We prefer it when the ROE of a company is above the industry average, but it's not the be-all and end-all if it is lower. Nonetheless, it might be wise tocheck if insiders have been selling. Companies usually need to invest money to grow their profits. That cash can come from retained earnings, issuing new shares (equity), or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. Although Elementis does use debt, its debt to equity ratio of 0.65 is still low. I'm not impressed with its ROE, but the debt levels are not too high, indicating the business has decent prospects. Conservative use of debt to boost returns is usually a good move for shareholders, though it does leave the company more exposed to interest rate rises. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. A company that can achieve a high return on equity without debt could be considered a high quality business. If two companies have the same ROE, then I would generally prefer the one with less debt. But when a business is high quality, the market often bids it up to a price that reflects this. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to check this FREEvisualization of analyst forecasts for the company. Of courseElementis may not be the best stock to buy. So you may wish to see thisfreecollection of other companies that have high ROE and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
What Kind Of Shareholder Owns Most BreadTalk Group Limited (SGX:CTN) Stock? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! The big shareholder groups in BreadTalk Group Limited (SGX:CTN) have power over the company. Institutions will often hold stock in bigger companies, and we expect to see insiders owning a noticeable percentage of the smaller ones. Warren Buffett said that he likes 'a business with enduring competitive advantages that is run by able and owner-oriented people'. So it's nice to see some insider ownership, because it may suggest that management is owner-oriented. With a market capitalization of S$423m, BreadTalk Group is a small cap stock, so it might not be well known by many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholder can tell us about CTN. Check out our latest analysis for BreadTalk Group Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index. BreadTalk Group already has institutions on the share registry. Indeed, they own 9.3% of the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of BreadTalk Group, (below). Of course, keep in mind that there are other factors to consider, too. BreadTalk Group is not owned by hedge funds. Quite a few analysts cover the stock, so you could look into forecast growth quite easily. While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves. I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions. Our information suggests that insiders own more than half of BreadTalk Group Limited. This gives them effective control of the company. So they have a S$223m stake in this S$423m business. It is good to see this level of investment. You cancheck here to see if those insiders have been buying recently. With a 24% ownership, the general public have some degree of sway over CTN. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run. We can see that public companies hold 14%, of the CTN shares on issue. It's hard to say for sure, but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership. I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph. But ultimatelyit is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look atthis free report showing whether analysts are predicting a brighter future. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Here's What EL.En. S.p.A.'s (BIT:ELN) P/E Ratio Is Telling Us Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). To keep it practical, we'll show how EL.En. S.p.A.'s (BIT:ELN) P/E ratio could help you assess the value on offer.What is EL.En's P/E ratio?Well, based on the last twelve months it is 21.5. That is equivalent to an earnings yield of about 4.7%. See our latest analysis for EL.En Theformula for price to earningsis: Price to Earnings Ratio = Price per Share ÷ Earnings per Share (EPS) Or for EL.En: P/E of 21.5 = €18.71 ÷ €0.87 (Based on the trailing twelve months to March 2019.) A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E. If earnings fall then in the future the 'E' will be lower. Therefore, even if you pay a low multiple of earnings now, that multiple will become higher in the future. So while a stock may look cheap based on past earnings, it could be expensive based on future earnings. EL.En's earnings per share grew by -7.4% in the last twelve months. And its annual EPS growth rate over 5 years is 11%. Unfortunately, earnings per share are down 13% a year, over 3 years. One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. If you look at the image below, you can see EL.En has a lower P/E than the average (31.9) in the medical equipment industry classification. This suggests that market participants think EL.En will underperform other companies in its industry. While current expectations are low, the stock could be undervalued if the situation is better than the market assumes. You should delve deeper. I like to checkif company insiders have been buying or selling. One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. So it won't reflect the advantage of cash, or disadvantage of debt. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash). While growth expenditure doesn't always pay off, the point is that it is a good option to have; but one that the P/E ratio ignores. EL.En has net cash of €62m. This is fairly high at 17% of its market capitalization. That might mean balance sheet strength is important to the business, but should also help push the P/E a bit higher than it would otherwise be. EL.En has a P/E of 21.5. That's higher than the average in the IT market, which is 16. Recent earnings growth wasn't bad. Also positive, the relatively strong balance sheet will allow for investment in growth -- and the P/E indicates shareholders that will happen! Investors have an opportunity when market expectations about a stock are wrong. If the reality for a company is better than it expects, you can make money by buying and holding for the long term. So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock. Of course,you might find a fantastic investment by looking at a few good candidates.So take a peek at thisfreelist of companies with modest (or no) debt, trading on a P/E below 20. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Yip's Chemical Holdings Limited (HKG:408): Time For A Financial Health Check Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! While small-cap stocks, such as Yip's Chemical Holdings Limited (HKG:408) with its market cap of HK$1.4b, are popular for their explosive growth, investors should also be aware of their balance sheet to judge whether the company can survive a downturn. Understanding the company's financial health becomes crucial, since poor capital management may bring about bankruptcies, which occur at a higher rate for small-caps. We'll look at some basic checks that can form a snapshot the company’s financial strength. Nevertheless, potential investors would need to take a closer look, and I recommend youdig deeper yourself into 408 here. 408 has built up its total debt levels in the last twelve months, from HK$2.5b to HK$2.6b , which includes long-term debt. With this rise in debt, 408's cash and short-term investments stands at HK$1.3b , ready to be used for running the business. On top of this, 408 has generated cash from operations of HK$741m in the last twelve months, leading to an operating cash to total debt ratio of 28%, meaning that 408’s current level of operating cash is high enough to cover debt. With current liabilities at HK$3.6b, the company has maintained a safe level of current assets to meet its obligations, with the current ratio last standing at 1.67x. The current ratio is calculated by dividing current assets by current liabilities. Usually, for Chemicals companies, this is a suitable ratio since there is a bit of a cash buffer without leaving too much capital in a low-return environment. With debt reaching 77% of equity, 408 may be thought of as relatively highly levered. This is somewhat unusual for small-caps companies, since lenders are often hesitant to provide attractive interest rates to less-established businesses. We can test if 408’s debt levels are sustainable by measuring interest payments against earnings of a company. Ideally, earnings before interest and tax (EBIT) should cover net interest by at least three times. For 408, the ratio of 5.59x suggests that interest is appropriately covered, which means that debtors may be willing to loan the company more money, giving 408 ample headroom to grow its debt facilities. 408’s high cash coverage means that, although its debt levels are high, the company is able to utilise its borrowings efficiently in order to generate cash flow. This may mean this is an optimal capital structure for the business, given that it is also meeting its short-term commitment. I admit this is a fairly basic analysis for 408's financial health. Other important fundamentals need to be considered alongside. You should continue to research Yip's Chemical Holdings to get a better picture of the small-cap by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for 408’s future growth? Take a look at ourfree research report of analyst consensusfor 408’s outlook. 2. Valuation: What is 408 worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? Theintrinsic value infographic in our free research reporthelps visualize whether 408 is currently mispriced by the market. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Crude Oil Pummeled, Where Is It Going Next? On Tuesday, July 2, 2019, the price of Crude Oil fell over -4.5% on continued expectations of global economic weakness and supply gluts. We found this interview rather interesting because it attempts to suggest a narrative that ignores Iranian issues while pushing the supply side fundamental for the current price decline (Source: CNBC ). Back on May 21, 2019, we shared a post that is still very relevant today. The same price pattern is still in place and the same type of price action is working through the completion of an extended Pennant/Flag formation. We suggest all our follower read this May 21 post to catch up to current market levels. May 21, 2019, Technical Analysis Post: GLOBAL ECONOMIC TENSIONS TRANSLATE INTO OIL VOLATILITY Our researchers believe the technical reason why Crude Oil will continue lower is that price rotation has continued to support a downside price trend (Bearish) and that recent price resistance near the upper price channel has been rejected. This is a near perfect example of how the Fibonacci price theory works in real markets. The price must always attempt to establish “new price highs” or “new price lows” AT ALL TIMES. After the deep price bottom in December 2018 near $42.50, oil price began an upside price move reaching just above our $66 target in late April 2019. Since then, another downside price move, which we called in our May 21 article, has driven oil prices to the $50.60 level. The current upside price move has recently retested the $60 resistance level and has pulled back to where we are today around $56 per barrel. The price rejection and subsequent collapse in price on July 2 represents a clear rotation from the $60 price level. This failure to achieve a “higher high” price level ($60 is lower than the previous peak near $66) is a very clear indication that price MUST move lower in an attempt to establish a new “lower low” – near or below $50.60. This is how the Fibonacci price theory works. Story continues We believe the last level of support for Oil is currently near $54.50. If this level is breached, we should see a very clear and quick price move lower targeting the $50.60 to $52.50 level where historical support resides. If that level fails, then a move to deeper historical support, near $42 if very likely. Everything hinges on what Oil will do near the $54.50 level as the price continues to push lower from the recent peak near $60. Technical traders should be prepared for a bit of volatility over the next few days, but we believe the $54.50 level will be breached and that oil prices will continue to fall back towards the previous low price level near $50.60. If price fails to find support there, it really has only one target left to reach – that is the $42 level. CONCLUDING THOUGHTS: In a previous article, we’ve shown you when the bottom was in for oil and stocks using our simple trade setup technique we use to identify entry and exit points for SP500 and Crude Oil – the 100% Fibonacci Extension Move. Now a month later we are providing more insight about oils potential drop to $42 if support is broken. If the price drops below $52 would also create selling pressure as the price will have fallen below the 200-period historical moving average level. This technical condition would suggest price weakness to the masses and could result in additional selling pressure from traders exiting the oil market and potentially even short selling pressure. I can tell you that huge moves are about to start unfolding not only in crude oil, but real estate, metals, stocks, and currencies. Some of these super cycles are even going to last years. Brad Matheny goes into great detail with his simple to understand charts and guide about this. His financial market research is one of a kind and a real eye-opener. PDF guide: 2020 Cycles – The Greatest Opportunity Of Your Lifetime As a technical analysis and trader since 1997, I have been through a few bull/bear market cycles. I believe I have a good pulse on the market and timing key turning points for both short-term swing trading and long-term investment capital. The opportunities are massive/life-changing if handled properly. Chris Vermeulen www.TheTechnicalTraders.com This article was originally posted on FX Empire More From FXEMPIRE: The Long And Short Plays For Gold Traders AUD/USD Price Forecast – Australian dollar stalls on thin holiday trading Silver Price Forecast – Silver markets drift lower during holiday GBP/USD Price Forecast – British pound shows weakness again during holiday GBP/USD Daily Forecast – British Pound Range Bound in Holiday Thinned Trading Bitcoin Tech Analysis – Recap and Mid-Day Review – 04/07/19
Can Alfa Financial Software Holdings PLC (LON:ALFA) Maintain Its Strong Returns? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. We'll use ROE to examine Alfa Financial Software Holdings PLC (LON:ALFA), by way of a worked example. Over the last twelve monthsAlfa Financial Software Holdings has recorded a ROE of 25%. Another way to think of that is that for every £1 worth of equity in the company, it was able to earn £0.25. Check out our latest analysis for Alfa Financial Software Holdings Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Alfa Financial Software Holdings: 25% = UK£18m ÷ UK£73m (Based on the trailing twelve months to December 2018.) Most know that net profit is the total earnings after all expenses, but the concept of shareholders' equity is a little more complicated. It is all the money paid into the company from shareholders, plus any earnings retained. Shareholders' equity can be calculated by subtracting the total liabilities of the company from the total assets of the company. ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the amount earned after tax over the last twelve months. That means that the higher the ROE, the more profitable the company is. So, as a general rule,a high ROE is a good thing. That means it can be interesting to compare the ROE of different companies. Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. As you can see in the graphic below, Alfa Financial Software Holdings has a higher ROE than the average (9.2%) in the Software industry. That's clearly a positive. In my book, a high ROE almost always warrants a closer look. For exampleyou might checkif insiders are buying shares. Most companies need money -- from somewhere -- to grow their profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the use of debt will improve the returns, but will not change the equity. Thus the use of debt can improve ROE, albeit along with extra risk in the case of stormy weather, metaphorically speaking. Alfa Financial Software Holdings is free of net debt, which is a positive for shareholders. Its impressive ROE suggests it is a high quality business, but it's even better to have achieved that without leverage. After all, when a company has a strong balance sheet, it can often find ways to invest in growth, even if it takes some time. Return on equity is one way we can compare the business quality of different companies. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better. Having said that, while ROE is a useful indicator of business quality, you'll have to look at a whole range of factors to determine the right price to buy a stock. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So I think it may be worth checking thisfreereport on analyst forecasts for the company. Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Elos Medtech AB (publ)’s (STO:ELOS B) Return On Capital Employed Any Good? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we'll look at Elos Medtech AB (publ) (STO:ELOS B) and reflect on its potential as an investment. Specifically, we'll consider its Return On Capital Employed (ROCE), since that will give us an insight into how efficiently the business can generate profits from the capital it requires. First up, we'll look at what ROCE is and how we calculate it. Next, we'll compare it to others in its industry. Then we'll determine how its current liabilities are affecting its ROCE. ROCE measures the amount of pre-tax profits a company can generate from the capital employed in its business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Renowned investment researcher Michael Mauboussinhas suggestedthat a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'. The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Elos Medtech: 0.059 = kr50m ÷ (kr1.0b - kr168m) (Based on the trailing twelve months to March 2019.) Therefore,Elos Medtech has an ROCE of 5.9%. View our latest analysis for Elos Medtech When making comparisons between similar businesses, investors may find ROCE useful. Using our data, Elos Medtech's ROCE appears to be around the 7.1% average of the Medical Equipment industry. Setting aside the industry comparison for now, Elos Medtech's ROCE is mediocre in absolute terms, considering the risk of investing in stocks versus the safety of a bank account. Readers may find more attractive investment prospects elsewhere. You can see in the image below how Elos Medtech's ROCE compares to its industry. Click to see more on past growth. It is important to remember that ROCE shows past performance, and is not necessarily predictive. ROCE can be misleading for companies in cyclical industries, with returns looking impressive during the boom times, but very weak during the busts. ROCE is only a point-in-time measure. Future performance is what matters, and you can see analyst predictions in ourfreereport on analyst forecasts for the company. Liabilities, such as supplier bills and bank overdrafts, are referred to as current liabilities if they need to be paid within 12 months. Due to the way ROCE is calculated, a high level of current liabilities makes a company look as though it has less capital employed, and thus can (sometimes unfairly) boost the ROCE. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets. Elos Medtech has total liabilities of kr168m and total assets of kr1.0b. As a result, its current liabilities are equal to approximately 16% of its total assets. It is good to see a restrained amount of current liabilities, as this limits the effect on ROCE. With that in mind, we're not overly impressed with Elos Medtech's ROCE, so it may not be the most appealing prospect. Of course,you might also be able to find a better stock than Elos Medtech. So you may wish to see thisfreecollection of other companies that have grown earnings strongly. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is Alcadon Group AB (publ)'s (STO:ALCA) 15% ROE Strong Compared To Its Industry? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). To keep the lesson grounded in practicality, we'll use ROE to better understand Alcadon Group AB (publ) (STO:ALCA). Over the last twelve monthsAlcadon Group has recorded a ROE of 15%. That means that for every SEK1 worth of shareholders' equity, it generated SEK0.15 in profit. View our latest analysis for Alcadon Group Theformula for ROEis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Alcadon Group: 15% = kr29m ÷ kr202m (Based on the trailing twelve months to March 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all earnings retained by the company, plus any capital paid in by shareholders. The easiest way to calculate shareholders' equity is to subtract the company's total liabilities from the total assets. ROE measures a company's profitability against the profit it retains, and any outside investments. The 'return' is the amount earned after tax over the last twelve months. A higher profit will lead to a higher ROE. So, all else equal,investors should like a high ROE. That means ROE can be used to compare two businesses. Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. However, this method is only useful as a rough check, because companies do differ quite a bit within the same industry classification. If you look at the image below, you can see Alcadon Group has a similar ROE to the average in the Electronic industry classification (14%). That isn't amazing, but it is respectable. ROE tells us about the quality of the business, but it does not give us much of an idea if the share price is cheap. I will like Alcadon Group better if I see some big insider buys. While we wait, check out thisfreelist of growing companies with considerable, recent, insider buying. Virtually all companies need money to invest in the business, to grow profits. That cash can come from issuing shares, retained earnings, or debt. In the first two cases, the ROE will capture this use of capital to grow. In the latter case, the debt used for growth will improve returns, but won't affect the total equity. That will make the ROE look better than if no debt was used. Although Alcadon Group does use debt, its debt to equity ratio of 0.76 is still low. The fact that it achieved a fairly good ROE with only modest debt suggests the business might be worth putting on your watchlist. Careful use of debt to boost returns is often very good for shareholders. However, it could reduce the company's ability to take advantage of future opportunities. Return on equity is a useful indicator of the ability of a business to generate profits and return them to shareholders. Companies that can achieve high returns on equity without too much debt are generally of good quality. If two companies have the same ROE, then I would generally prefer the one with less debt. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So I think it may be worth checking thisfreereport on analyst forecasts for the company. If you would prefer check out another company -- one with potentially superior financials -- then do not miss thisfreelist of interesting companies, that have HIGH return on equity and low debt. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
U.S. rapper A$AP Rocky arrested in Sweden after brawl: prosecutor STOCKHOLM (Reuters) - U.S. rapper A$AP Rocky was arrested early on Wednesday on suspicion of serious assault after a brawl in Sweden's capital, prosecutors said. The 30-year-old performer, producer and model was held with three others in connection with a fight that took place on Sunday, a Prosecution Authority spokeswoman said. "One person was arrested for assault and three people were arrested for serious assault, and the artist is one of those three," she added. A$AP Rocky was detained around 1 a.m. (2300 GMT Tuesday), the prosecution said, a few hours after his appearance at the Smash hip hop festival in Stockholm. A Swedish lawyer representing the artist told Reuters his client denied wrongdoing. "We are working hard with this and confident that the prosecutor will take a decision in favour of my client when he gets the full picture," lawyer Henrik Olsson Lilja said. (Reporting by Simon Johnson; Additional reporting by Esha Vaish; Editing by Andrew Heavens and Hugh Lawson)
Should You Think About Buying Enea AB (publ) (STO:ENEA) Now? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Enea AB (publ) (STO:ENEA), which is in the it business, and is based in Sweden, received a lot of attention from a substantial price movement on the OM over the last few months, increasing to SEK157 at one point, and dropping to the lows of SEK133. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Enea's current trading price of SEK140 reflective of the actual value of the small-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Enea’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change. View our latest analysis for Enea Good news, investors! Enea is still a bargain right now. My valuation model shows that the intrinsic value for the stock is SEK190.73, but it is currently trading at kr140 on the share market, meaning that there is still an opportunity to buy now. Although, there may be another chance to buy again in the future. This is because Enea’s beta (a measure of share price volatility) is high, meaning its price movements will be exaggerated relative to the rest of the market. If the market is bearish, the company's shares will likely fall by more than the rest of the market, providing a prime buying opportunity. Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. Though in the case of Enea, it is expected to deliver a relatively unexciting earnings growth of 9.7%, which doesn’t help build up its investment thesis. Growth doesn’t appear to be a main reason for a buy decision for the company, at least in the near term. Are you a shareholder?Even though growth is relatively muted, since ENEA is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. However, there are also other factors such as capital structure to consider, which could explain the current undervaluation. Are you a potential investor?If you’ve been keeping an eye on ENEA for a while, now might be the time to enter the stock. Its future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy ENEA. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed investment decision. Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Enea. You can find everything you need to know about Enea inthe latest infographic research report. If you are no longer interested in Enea, you can use our free platform to see my list of over50 other stocks with a high growth potential. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
The First Diamond Mine in Europe? Site-Visit Report on the Timantti-Diamond Project in Finland The First Diamond Mine in Europe? 50 km south of the Arctic Circle, Arctic Star aims to make that happen ZURICH, SWITZERLAND / ACCESSWIRE / July 3, 2019 /Rockstone has been following Arctic Star Exploration Corp. (TSX.V: ADD; OTC PINK: ASDZF; Frankfurt: 82A1) for several years now. In light of the recent discovery in Finland of the world's newest diamond field, the time has come to visit the project and meet the team behind Arctic Star. Although I am already a shareholder of Arctic Star, I must admit that the site-visit somewhat changed my perspective about this project and that I plan to participate in the next equity financing to increase my position. Frankly put, I don't want to miss the chance when the big picture gets recognized by the market as not only I, but the entire team behind Arctic Star, believes that this has great potential to become a diamond mine, which actually would be the first ever diamond producer in the European Union. When you watch the short site-visit video (3 minutes), you can only catch a glimpse of the project and what we have actually seen and discussed during our 4 day stay in Finland:Watch on YouTube:https://youtu.be/prncOgcjUH8 When you watch the presentation by Hugh O'Brien from the Geological Survey of Finland (GTK) in combination with the presentation by Roy Spencer, you may also come to the conclusion that this diamond project has encouraging signs to become a success, especially when considering that the people behind this project are highly experienced and have been extremely successful in diamond exploration (Buddy Doyle and Roy Spencer have discovered multi-billion-dollar diamond mines in Canada and Russia). Now, they are fully dedicated and eager to find the next diamond mine - this time in Finland, to be precise on the same craton where Roy discovered the Grib Diamond Pipe in Russia approximately 450 km away. The full report can be accessed with the following links: English (web version):https://www.rockstone-research.com/index.php/en/research-reports/5518-Site-Visit-Report-on-the-Timantti-Diamond-Project-in-FinlandEnglish (PDF):https://www.rockstone-research.com/images/PDF/ArcticStar10en.pdfGerman (PDF):https://www.rockstone-research.com/images/PDF/ArcticStar10de.pdfGerman (web version):https://www.rockstone-research.com/index.php/de/research-reports/5519-Site-Visit-Report-ueber-das-Timantti-Diamantenprojekt-in-Finnland Disclaimer: This report contains forward-looking information or forward-looking statements (collectively "forward-looking information") within the meaning of applicable securities laws. Forward-looking information is typically identified by words such as: "believe", "expect", "anticipate", "intend", "estimate", "potentially" and similar expressions, or are those, which, by their nature, refer to future events. Rockstone Research, Zimtu Capital Corp., and Arctic Star Exploration Corp. caution investors that any forward-looking information provided herein is not a guarantee of future results or performance, and that actual results may differ materially from those in forward-looking information as a result of various factors. The reader is referred to the Arctic Star Exploration Corp.'s public filings for a more complete discussion of such risk factors and their potential effects which may be accessed through the Arctic Star Exploration Corp.´s profile on SEDAR atwww.sedar.com.Please read the full disclaimer within the full research report as a PDF as fundamental risks and conflicts of interest exist.The author, Stephan Bogner, holds a long position in Arctic Star Exploration Corp. and is being paid by Zimtu Capital Corp., which company also holds a long position in Arctic Star Exploration Corp., whereas the featured company Arctic Star Exploration Corp. pays Zimtu Capital Corp. for the preparation, publication and additional distribution of this report. Arctic Star has also paid the travel-related expenses incurred by the author to visit Arctic Star's Timantti Project in Finland. SOURCE:Rockstone Research View source version on accesswire.com:https://www.accesswire.com/550728/The-First-Diamond-Mine-in-Europe-Site-Visit-Report-on-the-Timantti-Diamond-Project-in-Finland
A Look At The Fair Value Of Romande Energie Holding SA (VTX:HREN) Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we'll do a simple run through of a valuation method used to estimate the attractiveness of Romande Energie Holding SA (VTX:HREN) as an investment opportunity by taking the expected future cash flows and discounting them to their present value. I will be using the Discounted Cash Flow (DCF) model. Don't get put off by the jargon, the math behind it is actually quite straightforward. Remember though, that there are many ways to estimate a company's value, and a DCF is just one method. If you want to learn more about discounted cash flow, the rationale behind this calculation can be read in detail in theSimply Wall St analysis model. View our latest analysis for Romande Energie Holding We're using the 2-stage growth model, which simply means we take in account two stages of company's growth. In the initial period the company may have a higher growth rate and the second stage is usually assumed to have a stable growth rate. In the first stage we need to estimate the cash flows to the business over the next ten years. Where possible we use analyst estimates, but when these aren't available we extrapolate the previous free cash flow (FCF) from the last estimate or reported value. We assume companies with shrinking free cash flow will slow their rate of shrinkage, and that companies with growing free cash flow will see their growth rate slow, over this period. We do this to reflect that growth tends to slow more in the early years than it does in later years. A DCF is all about the idea that a dollar in the future is less valuable than a dollar today, so we need to discount the sum of these future cash flows to arrive at a present value estimate: [{"": "Levered FCF (CHF, Millions)", "2020": "CHF56.3m", "2021": "CHF62.5m", "2022": "CHF68.7m", "2023": "CHF76.3m", "2024": "CHF82.4m", "2025": "CHF87.9m", "2026": "CHF92.8m", "2027": "CHF97.3m", "2028": "CHF101.6m", "2029": "CHF105.8m"}, {"": "Growth Rate Estimate Source", "2020": "Analyst x1", "2021": "Analyst x1", "2022": "Analyst x1", "2023": "Analyst x1", "2024": "Est @ 8.01%", "2025": "Est @ 6.59%", "2026": "Est @ 5.59%", "2027": "Est @ 4.9%", "2028": "Est @ 4.41%", "2029": "Est @ 4.07%"}, {"": "Present Value (CHF, Millions) Discounted @ 8.04%", "2020": "CHF52.1", "2021": "CHF53.6", "2022": "CHF54.4", "2023": "CHF56.0", "2024": "CHF56.0", "2025": "CHF55.2", "2026": "CHF54.0", "2027": "CHF52.4", "2028": "CHF50.7", "2029": "CHF48.8"}] ("Est" = FCF growth rate estimated by Simply Wall St)Present Value of 10-year Cash Flow (PVCF)= CHF533.2m The second stage is also known as Terminal Value, this is the business's cash flow after the first stage. For a number of reasons a very conservative growth rate is used that cannot exceed that of a country's GDP growth. In this case we have used the 10-year government bond rate (3.3%) to estimate future growth. In the same way as with the 10-year 'growth' period, we discount future cash flows to today's value, using a cost of equity of 8%. Terminal Value (TV)= FCF2029× (1 + g) ÷ (r – g) = CHF106m × (1 + 3.3%) ÷ (8% – 3.3%) = CHF2.3b Present Value of Terminal Value (PVTV)= TV / (1 + r)10= CHFCHF2.3b ÷ ( 1 + 8%)10= CHF1.06b The total value, or equity value, is then the sum of the present value of the future cash flows, which in this case is CHF1.59b. In the final step we divide the equity value by the number of shares outstanding.This results in an intrinsic value estimate of CHF1541.82. Compared to the current share price of CHF1250, the company appears about fair value at a 19% discount to where the stock price trades currently. The assumptions in any calculation have a big impact on the valuation, so it is better to view this as a rough estimate, not precise down to the last cent. The calculation above is very dependent on two assumptions. The first is the discount rate and the other is the cash flows. Part of investing is coming up with your own evaluation of a company's future performance, so try the calculation yourself and check your own assumptions. The DCF also does not consider the possible cyclicality of an industry, or a company's future capital requirements, so it does not give a full picture of a company's potential performance. Given that we are looking at Romande Energie Holding as potential shareholders, the cost of equity is used as the discount rate, rather than the cost of capital (or weighted average cost of capital, WACC) which accounts for debt. In this calculation we've used 8%, which is based on a levered beta of 0.800. Beta is a measure of a stock's volatility, compared to the market as a whole. We get our beta from the industry average beta of globally comparable companies, with an imposed limit between 0.8 and 2.0, which is a reasonable range for a stable business. Although the valuation of a company is important, it shouldn’t be the only metric you look at when researching a company. The DCF model is not a perfect stock valuation tool. Rather it should be seen as a guide to "what assumptions need to be true for this stock to be under/overvalued?" If a company grows at a different rate, or if its cost of equity or risk free rate changes sharply, the output can look very different. For Romande Energie Holding, I've put together three pertinent factors you should further examine: 1. Financial Health: Does HREN have a healthy balance sheet? Take a look at ourfree balance sheet analysis with six simple checkson key factors like leverage and risk. 2. Future Earnings: How does HREN's growth rate compare to its peers and the wider market? Dig deeper into the analyst consensus number for the upcoming years by interacting with ourfree analyst growth expectation chart. 3. Other High Quality Alternatives: Are there other high quality stocks you could be holding instead of HREN? Exploreour interactive list of high quality stocksto get an idea of what else is out there you may be missing! PS. The Simply Wall St app conducts a discounted cash flow valuation for every stock on the VTX every day. If you want to find the calculation for other stocks justsearch here. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
With 3.9% Earnings Growth, Did The Hi-Tech Gears Limited (NSE:HITECHGEAR) Outperform The Industry? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Analyzing The Hi-Tech Gears Limited's (NSE:HITECHGEAR) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess HITECHGEAR's recent performance announced on 31 March 2019 and compare these figures to its long-term trend and industry movements. See our latest analysis for Hi-Tech Gears HITECHGEAR's trailing twelve-month earnings (from 31 March 2019) of ₹356m has increased by 3.9% compared to the previous year. However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 18%, indicating the rate at which HITECHGEAR is growing has slowed down. What could be happening here? Well, let's look at what's transpiring with margins and whether the whole industry is feeling the heat. In terms of returns from investment, Hi-Tech Gears has fallen short of achieving a 20% return on equity (ROE), recording 13% instead. Furthermore, its return on assets (ROA) of 7.5% is below the IN Auto Components industry of 7.9%, indicating Hi-Tech Gears's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Hi-Tech Gears’s debt level, has declined over the past 3 years from 17% to 12%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 24% to 148% over the past 5 years. While past data is useful, it doesn’t tell the whole story. Companies that have performed well in the past, such as Hi-Tech Gears gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research Hi-Tech Gears to get a more holistic view of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for HITECHGEAR’s future growth? Take a look at ourfree research report of analyst consensusfor HITECHGEAR’s outlook. 2. Financial Health: Are HITECHGEAR’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Those Who Purchased HSIL (NSE:HSIL) Shares A Year Ago Have A 23% Loss To Show For It Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Investors can approximate the average market return by buying an index fund. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. That downside risk was realized byHSIL Limited(NSE:HSIL) shareholders over the last year, as the share price declined 23%. That contrasts poorly with the market return of 3.8%. Longer term shareholders haven't suffered as badly, since the stock is down a comparatively less painful 9.9% in three years. On top of that, the share price has dropped a further 9.1% in a month. Check out our latest analysis for HSIL While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS). Unhappily, HSIL had to report a 5.5% decline in EPS over the last year. The share price decline of 23% is actually more than the EPS drop. Unsurprisingly, given the lack of EPS growth, the market seems to be more cautious about the stock. You can see below how EPS has changed over time (discover the exact values by clicking on the image). Dive deeper into HSIL's key metrics by checking this interactive graph of HSIL'searnings, revenue and cash flow. Investors should note that there's a difference between HSIL's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that HSIL's TSR, which was a 22%dropover the last year, was not as bad as the share price return. HSIL shareholders are down 22% for the year (even including dividends), but the market itself is up 3.8%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 1.7%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. Before deciding if you like the current share price, check how HSIL scores on these3 valuation metrics. Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of companies we expect will grow earnings. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Cuba Eyes Cryptocurrency as Solution to Sanctions, Financial Woes Cuba has announced it is considering the use of cryptocurrency in order to bolster its finances. According to areportfrom SBS-AAP, the country’s Communist government announced on state-run TV that it would potentially use crypto as part of a package aimed to boost incomes for as much as a quarter of Cubans and assist with market reforms. The move is possibly influenced by the nation’s ally, Venezuela, which launched its own “petro” cryptocurrency early last year. It’s not clear from the report if Cuba might launch its own token or use existing alternatives. Related:A New Bitcoin Exchange On the Colombian-Venezuelan Border Will Help Refugees Like Venezuela, Cuba is suffering from tough U.S.-led sanctions and has also seen a drop-off in aid from Venezuela which is undergoing both financial and political crises of its own. In the TV announcement, Cuba’s President Miguel Diaz-Canel indicted that the cryptocurrency plan is aimed to raise national production and demand in order to boost growth. The package would reportedly boost some pensions and wages for employees within public administration, social services and state-run media, almost doubling their average monthly wage. If so, the state appears to be placing a lot of hope in its crypto dreams. Venezuela has not seen its petro token take off internationally, despite havingtouted itat OPEC as a means for the world to pay for oil. Related:Venezuela Tries to Avoid US Sanctions By Trading In Rubles and Crypto Soon after launch, U.S. President Donald Trump alsoadded the petroto its list of sanctioned assets. Companies assisting the project in avoiding sanctions could also get in hot water. A Russian bank was itselfsanctioned by the U.S. Treasuryafter it was considered to have assisted financing of the petro. Cuban graffitiimage via Shutterstock • What’s Holding Back Bitcoin in Venezuela? This Group Is Investigating • Bitcoin Can’t Fix Venezuela: I Should Know
Terrorists are trafficking looted antiquities with impunity on Facebook Networks of criminals are trading priceless Middle Eastern antiquitiesfrom entire Roman mosaics to full Pharaonic coffinson Facebook, and there are no rules to stop them. The Athar Project , a group of volunteer anthropologists, have released a new report based on their monitoring of 95 Arabic-language Facebook groups where individuals in conflict zones like Syria, Yemen and Libya offer artifacts for sale, including to US buyers. According to their network analysis, one of the most important individuals in the trafficking network is based in Michigan City, Indiana. Jeffrey Epsteins fortune is built on fraud, a former mentor says The researchers identified several extremist groups, some fighting in Syria and others connected to Al Qaeda or ISIS, that benefitted from these sales. Some managers of the private Facebook groups, for instance, require new members seeking access to pay a tax on the sales generated by their participation. The organizers use the same Arabic term for the tax, khums , that was used by ISIS to profit from antiques trafficking during its brief existence as a state. [This] also reveals a more concerning issue: that the institutionalization of antiquities trafficking first established under ISIS was never fully dismantled, it just moved to a new medium, the report says. The FBI has warned art dealers that purchasing artifacts plundered by terrorist groups could be illegal. The US government has imposed restrictions on the import of antiquities from Egypt, Libya, Syria and Iraq. The export of such goods is largely illegal in countries across the Middle East. But Facebook has no legal responsibility to prevent these sales as part of the broad immunity technology companies receive for the conduct of third-parties on their platform. The company did not reply to a request for comment about its policies on the trafficking of cultural artifacts by suspected terrorists on its platform. The simplest way to improve your credit score is by using your email Story continues Participants in the groups also traded knowledge. In one example, members posted Google Earth screenshots of archaeological sites and offered pointers on how best to loot them. Members used Facebook Stories to post images of the antiquities that would be erased in 24 hours, and Facebooks encrypted chat to communicate. The report says there is reason to believe some of these transactions are conducted on Facebook payments, noting thatadmins seeking a khums tax are not going to have the same in-person exchange of goods that the buyer and seller will engage in. Therefore, this payment is likely carried out through a digital transaction. All of this activity was monitored and archived by Athars ream of researchers. This is really valuable war crimes evidence that can actually be used in prosecution, Katie Paul, an anthropologist who is the co-director of the Athar Project, said. These are links to real peoples profiles. In 2015, the International Criminal Court sentenced Ahmad Al-Faqi Al-Mahdi, an alleged member of the Malian Islamist militant group Ansar Al Dine, to nine years in prison for his part in destroying ancient Islamic tombs in Timbuktu. The key evidence in that case, Paul says, was a YouTube video of the destruction, and she hopes the copious evidence she has collected online will help bring justice to others who commit cultural crimes. Facebook, she says, typically deletes these groups when they are identified, instead of preserving the evidence of their activities. The projects co-director is the Syrian archaeologist Amr Al-Azm, who has been working to protect his countrys cultural heritage from the conflict that began in 2012. Syria is one of the oldest homes of humanity, with heritage important to Muslim, Christian and Jewish believers as well as vital clues about the history of Roman, Greek and ancient civilizations. Al-Azm works with a network of people on the ground in Syria to track antiquities theft, and those sources have helped link Facebook postings to real individuals. In several cases, antiquities photographed within Syria or spotted on weapons-trading forums later resurfaced in Facebooks antiquities trading groups. More than a third of the posts on these Facebook groups are from users in conflict zones, and 44% were from countries bordering conflict zones, according to Athars analysis. The chaos of war prevents domestic governments from enforcing laws against exporting antiquities . Only Egypt has been able to take action on this front, arresting several individuals for selling antiquities on Facebook last year (link in Arabic). At least one prominent American antiquities dealer was found to be Facebook friends with a Syrian organizer who manages four of these Facebook groups. Paul wouldnt share the Americans identity but said she reported it to the authorities. It would not be the first time a prominent US collector has been found buying questionable antiquities; The family behind the Hobby Lobby store franchise paid $1.6 million for ancient cuneiform tablets and smuggled them into the US through Israel. They ultimately forfeited the artifacts and paid a $3 million fine. High net-worth companies and individuals, if they get caught, they can afford the million dollar fine, and they simply forfeit the assets and continue building their collections elsewhere, Paul said. Besides the obvious problems of financing terror groups abroad and the loss of important historical artifacts to researchers, the looting of cultural goods also damages the economic future of these countries. Tourism is a vital part of the Middle Easts economybefore the Egyptian revolution, it accounted for a ludicrous 11% of the countrys GDP. Widespread destruction of famous sites in Syria like the Temples at Palmyra isnt just a loss to our collective heritage, it will make it that much harder for a future, peaceful Syria to find prosperity again. Paul began her work on antiquities trafficking doing research on post-revolution Egypt, when activists and archaeologists worked to restore the collection of the Egyptian Museum after it was looted in 2011, sometimes using online tools to ID and track missing objects. In doing so, I was searching some of the Arabic key terms for antiquities, and I totally by chance stumbled upon these groups, Paul said. Thanks to Facebooks lovely algorithm, each time I would join one group it would recommend three more. Sign up for the Quartz Daily Brief , our free daily newsletter with the worlds most important and interesting news. More stories from Quartz: The glow of the historic accord between Ethiopia and Eritrea has faded Zimbabwe banned the US dollar from being used so local bitcoin demand is soaring again
What is KuCoin? KuCoin is a cryptocurrency exchange initially from China that relocated to Hong Kong for a more favourable regulatory climate. It has a solid reputation for being user-friendly (great for beginners), trustworthy, and secure. The platform is currently ranked number 41 in the list of largest crypto exchanges by CoinMarketCap, with an adjusted 24-hour trading volume of almost $200 million. KuCoin lists over 400 cryptocurrencies and tokens and is known for being an early adopter of new digital coins. Traders who are looking to experiment with new cryptocurrencies are likely to find this platform a useful resource. KuCoin also has a native cryptocurrency called KuCoin Shares (KCS) which powers a loyalty scheme for end users. Low fees and incentives KuCoin doesn’t have deposit fees. The trading fee is 0.1%, while withdrawal fees vary depending on the cryptocurrency. Relative to other exchanges, withdrawal fees are low – just 0.0005 for BTC, 0.01 for ETH, or 4.2 for USDT. NEO and GAS have zero withdrawal fees. Transactions on the platform are fast. KuCoin processes low-value withdrawals in seconds while larger withdrawals require about 10 minutes to be completed. The exchange processes deposits in two minutes or less. KuCoin uses a series of bonuses to encourage users to buy and use its native cryptocurrency, KuCoin Shares. Holders receive dividends daily and benefit from discounts on withdrawal and trading fees. Moreover, users that hold KCS get exclusive promotions and extra rewards for their activity. This is a way for the platform to share part of its profits with KCS owners and encourage adoption at the same time. People who have an account on the platform can receive incentives for bringing in new users. A trader who invites new members receives a portion of the trading fees collected from the new users. If this sounds a little like a pyramid scheme, that’s because it is. Most probably, the platform will have to end this practice as it will prove expensive as the number of invitations grows. Story continues No fiat currency The downside of using KuCoin is that the exchange doesn’t work with fiat currency. So, you’ll need to use a different service to get Bitcoin or Ethereum before trading on KuCoin. While most digital coins can be purchased with BTC or ETH only, some cryptocurrencies can be bought with NEO, USDT, or KCS. Besides this inconvenience, the platform works like most crypto exchanges on the market. Users can keep track of their assets easier and manage their funds through a modern, straightforward interface. The exchange also has a two-factor authentication feature that adds an extra layer of security to users’ accounts. KuCoin features KuCoin has been working to build a solid reputation with more than just low fees. The Chinese cryptocurrency exchange relies on a tried and tested mix of features meant to separate its service from competitors. Among these, the platform lists the most advanced API in the market, excellent customer service, scalability, safety, and an exceptional team of cryptocurrency experts. API The platform has a powerful API interface. KuCoin APIs are divided into REST APIs (with four categories of private and public data) and WebSocket feeds (which mostly provide public market data). Customer service The exchange provides 24/7 support through email, hotline, and directly on the website. Note that customer support is located in Hong Kong, so you may need to overcome cultural barriers when speaking to a consultant. Scalability The platform continues to add new cryptocurrencies and claims to support an infinite number of trading pairs. It is a pioneer in implementing pairs that aren’t yet listed by other platforms. Safety The crypto exchange has implemented a series of security levels to protect users’ funds. It has a standard transfer encryption protocol to ensure the privacy of its users. Moreover, the platform uses a private network powered by Amazon Web Services Cloud to store micro-wallets. The team KuCoin was designed and developed by a group of blockchain enthusiasts with a solid professional background in the industry. The team focuses on research and development as essential elements for success. KuCoin Shares The KuCoin cryptocurrency, KCS, is a decentralised cryptocurrency based on top of the Ethereum protocol. It also works with all Ethereum wallets. It started with a total volume of 200 million KCS. The platform has issued a plan for buyback disposal, which aims to keep a constant 100 million tokens on the market. According to KuCoin, the company will use 10% of each quarter’s net profit to buy back and destroy KCS. The takeaway At first glance, KuCoin isn’t just another cryptocurrency exchange. The team appears to have a long-term plan, a vision for creating a viable service, and encouraging crypto adoption at a global level. Despite not supporting any fiat currency, the platform continues to gain users thanks to its willingness to share profits and improve services. The post What is KuCoin? appeared first on Coin Rivet .
Will Slack change work before work changes Slack? On a winter day in 2017, a researcher in Slack’s offices in San Francisco began walking five people through a new version of Slack for the first time. They were testing out a new signup flow designed by Merci Grace, one of Slack’s product managers. It so happened that Stewart Butterfield, Slack’s co-founder, was going… Sign up for the Quartz Daily Brief , our free daily newsletter with the world’s most important and interesting news. More stories from Quartz: The glow of the historic accord between Ethiopia and Eritrea has faded Zimbabwe banned the US dollar from being used so local bitcoin demand is soaring again
Sainsbury's sales drop for third straight quarter By James Davey LONDON (Reuters) - Sainsbury's sales fell for a third straight quarter as demand for clothes and general merchandise cooled, and the British supermarket group warned investors against expecting an upturn any time soon with Brexit looming. After the company's 7.3 billion pound ($9.2 billion) bid for rival Asda was blocked by Britain's competition regulator, and with its shares down 37% over the last year, CEO Mike Coupe is under pressure to show Sainsbury's can prosper on its own. But he indicated on Wednesday that in a highly competitive and promotional market, and with the consumer outlook uncertain, investors would have to be patient for a return to sales growth. "I'm not going to make myself a hostage to fortune by predicting the future," he told reporters. "There are lots of things - we talked about Brexit as an example - that could significantly disrupt our business and our industry." Echoing recent comments from market leader Tesco, Coupe said the Oct. 31 departure date for Britain to leave the European Union - pushed back from the original deadline of March 29 - was "not far off the worst day that you could possibly choose" due to the proximity of Halloween, Black Friday and Christmas, warning of a possible impact on fresh food and toy imports if trade flows are disrupted. Coupe, who was paid 3.9 million pounds in 2018-19, will face investors on Thursday at the group's annual shareholder meeting. Sainsbury's is cutting prices on daily essentials while investing in stores, technology and online services to meet the challenges of a fast-changing industry, where customers are shopping more frequently, demanding more convenience, buying more online and also flocking to discount stores. So far prices have been cut on over 1,000 own brand products including dairy, meat, fish, poultry and fresh fruit and vegetables - adding to the competitive pressure in the sector. Data on Wednesday showed British shop prices in June fell for the first time since October. “We think we’ve done a pretty good job in our added value food ranges, where we have a challenge is in commodities. We’ve started to address that issue and actually we’re pleased with the progress we’ve made," said Coupe. He pointed to "market leading" prices on items such as a 250g pack of strawberries cut from 1.50 pound to 1 pound, and a 640g pack of chicken breast fillets cut to 3.60 pounds from 4.30 pounds, which have boosted sales volumes. SALES FALL GETTING WORSE Sainsbury's said its like-for-like sales, excluding fuel, fell 1.6% in the 16 weeks to June 29, its fiscal first quarter. That compared with analysts' forecasts for a fall of 1.1% to 2% and a drop of 0.9% in the previous quarter. While total grocery sales fell 0.5%, general merchandise sales dropped 3.1% and clothing sales were down 4.5%. Shares in Sainsbury's reversed initial losses to trade up in early morning trade. "There might be some relief that things aren't getting worse in grocery," said Bernstein analyst Bruno Monteyne. Despite the sales declines, Sainsbury's said its premium "Taste the Difference" own-brand food range gained market share, as did clothing and key general merchandise categories such as consumer electronics, technology, furniture and toys. Recent official data and updates from peers, including Tesco, had already painted a gloomy picture for retailers, reflecting political and economic uncertainty and a tough comparison with the same quarter last year when Britain enjoyed a heatwave and major events including a royal wedding and the men's soccer World Cup. Sainsbury's finance chief Kevin O'Byrne said he was comfortable about analysts' consensus profit forecast for the 2019-20 financial year, which currently stands at 632 million pounds, just below the 635 million made in 2018-19. ($1 = 0.7957 pounds) (Reporting by James Davey; Editing by Kate Holton and Mark Potter)
AUD/USD and NZD/USD Fundamental Daily Forecast – US ADP Report Should Set the Tone Today The Australian and New Zealand Dollars are trading mixed on Wednesday as investors weigh fresh domestic economic data against concerns over a global economic slowdown and a slew of European and U.S. data due later today. Investors in both currencies are also considering the possibility of future rate cuts by their respective central banks as well as the strong probability of rate cut by the European Central Bank and U.S. Federal Reserve in July. At 07:32 GMT, theAUD/USDis trading .6992, down 0.0002 or -0.03% and theNZD/USDis at .6678, up 0.0006 or +0.10%. On Tuesday, traders had a chance to react to the RBA’s latest interest rate decision and monetary policy statement. Earlier today, it was domestic data on Building Approvals and the Trade Balance that were their major concerns. The Australian Bureau of Statistics said on Wednesday that building approvals rose by 0.7 percent in May as apartment growth ended a two-month run of declines. Approvals for private sector houses fell a seasonally adjusted 0.3 percent in the month, but the “other dwellings” category that includes apartment blocks and townhouses, rose 1.2 percent to lift the overall figure. Over the 12 months to May, total building approvals for dwellings fell by 19.6 percent. Traders don’t expect the RBA’s back-to-back rate cuts to be seen in approvals figures for some time. Additionally, Australia’s trade surplus hit a record $5.7 billion in May after a $925 million monthly rise driven entirely by iron ore exports to China. The $5.75 billion surplus was up 19 percent in seasonally adjusted terms, the Australian Bureau of Statistics said on Wednesday, and it handily beat expectations of a $5.25 billion surplus. In New Zealand, traders are responding to a weak business confidence report. The latest NZIER Quarterly Survey of Business Opinion (QSBO) shows business confidence fell to its lowest level since March 2009, with a net 31 percent of businesses expecting a deterioration in general economic conditions over the coming months. Additionally, Statistics New Zealand reported that the number of building consents rose 13% in May after falling 7.9% in April. The early trading ranges are tight, but volatility could hit the Forex market later in the session with the release of several U.S. reports that could have an impact on Fed policy later in the month. At 12:15 GMT, investors will get the opportunity to react to the ADP Non-Farm Employment Change report. It is expected to show the private sector of the economy added 140K jobs in June. A report on ISM Non-Manufacturing PMI is expected to come in at 56.1, slightly below the previously released 56.9. This report will be released at 14:00 GMT. The ADP report is likely to generate the biggest reaction by investors because it is often used as a proxy for Friday’s U.S. Non-Farm Payrolls report. A better-than-expected number could dampen the chances of a July Fed rate cut. Basically, stronger-than-expected U.S. data is likely to put pressure on the AUD/USD and NZD/USD. Thisarticlewas originally posted on FX Empire • S&P 500 Price Forecast – Stock market futures quiet during Holiday • Forex Daily Recap – Cable Extended a 2-Day Halt at 78.6% Fib Level • Natural Gas Forecast – Natural gas markets do nothing on Independence Date • Investing in a late-cycle Economy • EUR/USD Daily Forecast – Volatility Drops as US Traders Celebrate 4th of July • Crazy Time in Bond Land – Buy Everything Part 2
Is Logitech International S.A. (VTX:LOGN) A High Quality Stock To Own? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Many investors are still learning about the various metrics that can be useful when analysing a stock. This article is for those who would like to learn about Return On Equity (ROE). By way of learning-by-doing, we'll look at ROE to gain a better understanding of Logitech International S.A. (VTX:LOGN). Over the last twelve monthsLogitech International has recorded a ROE of 22%. Another way to think of that is that for every CHF1 worth of equity in the company, it was able to earn CHF0.22. Check out our latest analysis for Logitech International Theformula for return on equityis: Return on Equity = Net Profit ÷ Shareholders' Equity Or for Logitech International: 22% = US$258m ÷ US$1.2b (Based on the trailing twelve months to March 2019.) Most readers would understand what net profit is, but it’s worth explaining the concept of shareholders’ equity. It is all the money paid into the company from shareholders, plus any earnings retained. You can calculate shareholders' equity by subtracting the company's total liabilities from its total assets. ROE looks at the amount a company earns relative to the money it has kept within the business. The 'return' is the amount earned after tax over the last twelve months. That means that the higher the ROE, the more profitable the company is. So, all else equal,investors should like a high ROE. Clearly, then, one can use ROE to compare different companies. Arguably the easiest way to assess company's ROE is to compare it with the average in its industry. The limitation of this approach is that some companies are quite different from others, even within the same industry classification. Pleasingly, Logitech International has a superior ROE than the average (9.5%) company in the Tech industry. That's what I like to see. I usually take a closer look when a company has a better ROE than industry peers. One data point to check is ifinsiders have bought shares recently. Most companies need money -- from somewhere -- to grow their profits. The cash for investment can come from prior year profits (retained earnings), issuing new shares, or borrowing. In the case of the first and second options, the ROE will reflect this use of cash, for growth. In the latter case, the debt required for growth will boost returns, but will not impact the shareholders' equity. In this manner the use of debt will boost ROE, even though the core economics of the business stay the same. Shareholders will be pleased to learn that Logitech International has not one iota of net debt! Its ROE already suggests it is a good business, but the fact it has achieved this -- and doesn't borrowings -- makes it worthy of further consideration, in my view. After all, with cash on the balance sheet, a company has a lot more optionality in good times and bad. Return on equity is one way we can compare the business quality of different companies. A company that can achieve a high return on equity without debt could be considered a high quality business. All else being equal, a higher ROE is better. But ROE is just one piece of a bigger puzzle, since high quality businesses often trade on high multiples of earnings. The rate at which profits are likely to grow, relative to the expectations of profit growth reflected in the current price, must be considered, too. So you might want to take a peek at thisdata-rich interactive graph of forecasts for the company. Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Should You Be Tempted To Sell HiQ International AB (publ) (STO:HIQ) Because Of Its P/E Ratio? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! The goal of this article is to teach you how to use price to earnings ratios (P/E ratios). To keep it practical, we'll show how HiQ International AB (publ)'s (STO:HIQ) P/E ratio could help you assess the value on offer. Based on the last twelve months,HiQ International's P/E ratio is 18.74. That means that at current prices, buyers pay SEK18.74 for every SEK1 in trailing yearly profits. View our latest analysis for HiQ International Theformula for P/Eis: Price to Earnings Ratio = Share Price ÷ Earnings per Share (EPS) Or for HiQ International: P/E of 18.74 = SEK52 ÷ SEK2.78 (Based on the trailing twelve months to March 2019.) A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't a good or a bad thing on its own, but a high P/E means that buyers have a higher opinion of the business's prospects, relative to stocks with a lower P/E. Probably the most important factor in determining what P/E a company trades on is the earnings growth. Earnings growth means that in the future the 'E' will be higher. That means even if the current P/E is high, it will reduce over time if the share price stays flat. And as that P/E ratio drops, the company will look cheap, unless its share price increases. HiQ International shrunk earnings per share by 1.0% last year. But EPS is up 5.9% over the last 5 years. One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. You can see in the image below that the average P/E (18.4) for companies in the it industry is roughly the same as HiQ International's P/E. HiQ International's P/E tells us that market participants think its prospects are roughly in line with its industry. So if HiQ International actually outperforms its peers going forward, that should be a positive for the share price. Checking factors such asdirector buying and selling. could help you form your own view on if that will happen. One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. In other words, it does not consider any debt or cash that the company may have on the balance sheet. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash). Spending on growth might be good or bad a few years later, but the point is that the P/E ratio does not account for the option (or lack thereof). The extra options and safety that comes with HiQ International's kr233m net cash position means that it deserves a higher P/E than it would if it had a lot of net debt. HiQ International has a P/E of 18.7. That's higher than the average in the SE market, which is 17. The recent drop in earnings per share would make some investors cautious, but the healthy balance sheet means the company retains potential for future growth. If fails to eventuate, the current high P/E could prove to be temporary, as the share price falls. When the market is wrong about a stock, it gives savvy investors an opportunity. If the reality for a company is better than it expects, you can make money by buying and holding for the long term. So thisfreereport on the analyst consensus forecastscould help you make amaster moveon this stock. You might be able to find a better buy than HiQ International. If you want a selection of possible winners, check out thisfreelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Nokia's digitalization of its 5G Oulu factory recognized by the World Economic Forum as an "Advanced 4th Industrial Revolution Lighthouse" Press Release • The Oulu factory, powered by Nokia`s own technology, generated productivity gains of 30 percent and 50 percent savings in time of product delivery to market • By demonstrating industrial IoT productivity gains for enterprises, Nokia paves the way for other enterprises to digitally transform for the Industry 4.0 era, adopting critical technologies at scale 3 July 2019 Espoo, Finland - Nokia`s 5G "factory of the future" in Oulu, Finland was selected by McKinsey and the World Economic Forum as an Advanced 4thIndustrial Revolution (4IR) Lighthouse, reflecting leadership and proven success in adopting and implementing 4IR technologies at scale. Leveraging Nokia technologies to digitalize its own pre-production facility demonstrates Nokia`s ability to digitally transform and modernize its customers` manufacturing facilities for Industry 4.0. Designed to showcase Industry 4.0 concepts for the manufacturing of Nokia 4G and 5G base stations, the "factory of the future" in Oulu leverages Nokia`sprivate (4.9G/LTE) wirelessnetworks for secure and reliable connectivity for all assets within and outside the factory,IoT analyticsrunning onEdge cloud, and a real-time digital twin of operations data. The factory, which produces 1,000 4G and 5G base stations per day, generated significant annual improvements, including more than 30 percent productivity gains, 50 percent savings in time of product delivery to market, and an annual cost savings of millions of euros. The Lighthouse program, conducted in collaboration with McKinsey, includes select Lighthouse factories that are transforming work to make it safer, less repetitive, diversified and productive. Nokia was selected as a Lighthouse by an expert panel based on its implementation of 4IR technologies that drove financial and operational impact in the Oulu factory. As part of the Global Lighthouse Network, Nokia will collaborate with other world leaders to share knowledge and best practices to help enterprises and manufacturers adopt the technologies of the future, and overcome key challenges enterprises face during their digital transformation journeys. Kathrin Buvac, President of Nokia Enterprise and Chief Strategy Officer, said:"We are paving the way for enterprise customers to realize the vision of Industry 4.0 and industrial automation by applying our technology to our manufacturing needs. For our Oulu 5G facility, we created a `factory of the future` environment leveraging private wireless networks for reliable and secure in-factory connectivity, edge cloud and IoT analytics. We are very pleased that our technology has delivered productivity gains of over 30 percent for our factory and we look forward to share this expertise with customers, helping them accelerate growth and unlock their full potential." Most manufacturers seek to increase flexibility while automating and reconfiguring factories. Nokia`s expertise adjusting to high-demand environments ensures that the company is well equipped to lead enterprises into the Industry 4.0 era. The award-winning factory of the future illustrates how customer facilities can reap the benefits of increased productivity, agility, product quality, and product lead time for their businesses, as achieved in Oulu. Demonstrated use cases in Oulu pre-production factory include: • Virtualization of new product introduction (NPI) • Flexible robotics to ensure high-productivity and agility for continuous new ramp-ups • 4.9G/LTE Private wireless network to speed up NPI line re-layout • Cloud-based digital data control, enabling real-time process management • No-touch internal logistics automation via connected mobile robots Heikki Romppainen, Head of Oulu Factory, Nokia, said:"For factory employees, the automation of our Oulu manufacturing environment increases flexibility and adaptability. The `conscious factory` has evolved the working ecosystem - increasing motivation and the wellbeing of employees by automating the traditionally repetitive tasks, making work more diversified and productive." Resources: • Images - use cases:Industry 4.0 use cases at Nokia Oulu factory • WEF White paper:Fourth Industrial Revolution: Beacons of Technology and Innovation in Manufacturing • Strategic White paper:Networking solutions for the new age of industry • Webpage:Edge cloud • Video:Nokia and Telia leverage 5.0 performance for Industry 4.0 • Images:Nokia for Industries media library About Nokia for IndustriesNokia has deployed over 1,000 mission-critical networks with leading customers in the transport, energy, large enterprise, manufacturing, webscale and public sector segments around the globe. Leading enterprises across industries are leveraging our decades of experience building some of the biggest and most advanced IP, optical, and wireless networks on the planet. The Nokia Bell Labs Future X for industries architecture provides a framework for enterprises to accelerate their digitalization and automation journey to Industry 4.0. About NokiaWe create the technology to connect the world. We develop and deliver the industry`s only end-to-end portfolio of network equipment, software, services and licensing that is available globally. Our customers include communications service providers whose combined networks support 5.7 billion subscriptions, as well as enterprises in the private and public sector that use our network portfolio to increase productivity and enrich lives. Through our research teams, including the world-renowned Nokia Bell Labs, we are leading the world to adopt end-to-end 5G networks that are faster, more secure and capable of revolutionizing lives, economies and societies. Nokia adheres to the highest ethical business standards as we create technology with social purpose, quality and integrity.nokia.com Media Inquiries:Nokia CommunicationsPhone: +358 10 448 4900Email:[email protected] This announcement is distributed by West Corporation on behalf of West Corporation clients.The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.Source: NOKIA via GlobeNewswireHUG#2246813
Should You Be Happy With Midwich Group Plc's (LON:MIDW) 8.6% Earnings Growth? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Increase in profitability and industry-beating performance can be essential considerations in a stock for some investors. In this article, I will take a look at Midwich Group Plc's (LON:MIDW) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers. Check out our latest analysis for Midwich Group MIDW's trailing twelve-month earnings (from 31 December 2018) of UK£15m has increased by 8.6% compared to the previous year. However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 28%, indicating the rate at which MIDW is growing has slowed down. Why could this be happening? Well, let's examine what's transpiring with margins and if the rest of the industry is feeling the heat. In terms of returns from investment, Midwich Group has invested its equity funds well leading to a 26% return on equity (ROE), above the sensible minimum of 20%. However, its return on assets (ROA) of 7.4% is below the GB Electronic industry of 7.6%, indicating Midwich Group's are utilized less efficiently. Furthermore, its return on capital (ROC), which also accounts for Midwich Group’s debt level, has declined over the past 3 years from 57% to 32%. Midwich Group's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. While Midwich Group has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I recommend you continue to research Midwich Group to get a better picture of the stock by looking at: 1. Future Outlook: What are well-informed industry analysts predicting for MIDW’s future growth? Take a look at ourfree research report of analyst consensusfor MIDW’s outlook. 2. Financial Health: Are MIDW’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out ourfinancial health checks here. 3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore ourfree list of these great stocks here. NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 2018. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Is mobilezone holding ag (VTX:MOZN) A Great Dividend Stock? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Dividend paying stocks like mobilezone holding ag (VTX:MOZN) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. If you are hoping to live on the income from dividends, it's important to be a lot more stringent with your investments than the average punter. A high yield and a long history of paying dividends is an appealing combination for mobilezone holding ag. It would not be a surprise to discover that many investors buy it for the dividends. There are a few simple ways to reduce the risks of buying mobilezone holding ag for its dividend, and we'll go through these below. Explore this interactive chart for our latest analysis on mobilezone holding ag! Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. As a result, we should always investigate whether a company can afford its dividend, measured as a percentage of a company's net income after tax. In the last year, mobilezone holding ag paid out 59% of its profit as dividends. This is a healthy payout ratio, and while it does limit the amount of earnings that can be reinvested in the business, there is also some room to lift the payout ratio over time. Another important check we do is to see if the free cash flow generated is sufficient to pay the dividend. Last year, mobilezone holding ag paid a dividend while reporting negative free cash flow. While there may be an explanation, we think this behaviour is generally not sustainable. Remember, you can always get a snapshot of mobilezone holding ag's latest financial position,by checking our visualisation of its financial health. One of the major risks of relying on dividend income, is the potential for a company to struggle financially and cut its dividend. Not only is your income cut, but the value of your investment declines as well - nasty. mobilezone holding ag has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. During the past ten-year period, the first annual payment was CHF0.33 in 2009, compared to CHF0.60 last year. Dividends per share have grown at approximately 6.2% per year over this time. Companies like this, growing their dividend at a decent rate, can be very valuable over the long term, if the rate of growth can be maintained. The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. It's good to see mobilezone holding ag has been growing its earnings per share at 11% a year over the past 5 years. mobilezone holding ag's earnings per share have grown rapidly in recent years, although more than half of its profits are being paid out as dividends, which makes us wonder if the company has a limited number of reinvestment opportunities in its business. We'd also point out that mobilezone holding ag issued a meaningful number of new shares in the past year. Regularly issuing new shares can be detrimental - it's hard to grow dividends per share when new shares are regularly being created. To summarise, shareholders should always check that mobilezone holding ag's dividends are affordable, that its dividend payments are relatively stable, and that it has decent prospects for growing its earnings and dividend. mobilezone holding ag gets a pass on its dividend payout ratio, but it paid out virtually all of its cash flow as dividends. This may just be a one-off, but we'd keep an eye on this. That said, we were glad to see it growing earnings and paying a fairly consistent dividend. While we're not hugely bearish on it, overall we think there are potentially better dividend stocks than mobilezone holding ag out there. Are management backing themselves to deliver performance? Check their shareholdings in mobilezone holding ag inour latest insider ownership analysis. Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Market report: Sainsbury's slips, Lagarde at the ECB, and Serco fine Mike Coupe, CEO of Sainsbury's and Martin Scicluna, chairman of Sainsbury's, pose for a portrait at the company headquarters in London. Photo: Toby Melville/Reuters Here are the top business, market, and economic stories you should be watching today in the UK, Europe, and abroad: Sainsbury’s slips Sainsbury’s ( SBRY.L ) missed analysts’ forecasts with first quarter results on Wednesday but pointed to market share gains “in a tough trading environment.” The retailer saw like-for-like sales slide by 1.6% in the 16 weeks to 29 June, as its decline accelerated from 0.9% in the previous quarter. The slide was worse than the 1.5% dip in sales City analysts expected. Bruno Monteyne, an analyst at Bernstein, said Sainsbury’s quarterly fall “compares unfavourably against the Q1 like-for-like performance of its big-4 peers (Tesco UK +0.4% ex. Booker, Asda +0.5% ex. cal, Morrisons +0.2%).” Grocery sales fell by 0.5%, which beat forecasts, but general merchandise sales dropped by 3.1% and clothing sales fell by 4.5%. “We continue to adapt our business to changing shopping habits and made good progress in a challenging market,” Sainsbury’s CEO Mike Coupe said. Coupe is expected to face criticism from some investors at the supermarket’s annual general meeting on Thursday, following the collapse of its planned mega-merger with Asda earlier this year. Sainsbury’s shares fell by as much as 1.5% at the open but have recovered and are trading down 0.3% at 8.45am. Lagarde at the ECB International Monetary Fund head Christine Lagarde has been picked to take over as head of the European Central Bank. Lagarde will replace Mario Draghi, who has run the ECB since 2011 and will leave the central bank in October. Lagarde has been director of the IMF since 2011 and is set to be the first woman to lead the ECB, as well as the first non-economist. Her background is in law and politics. European leaders agreed on new appointees for all of the top jobs at a summit in Brussels on Tuesday evening. German defence minister Ursula von der Leyen will become European Commission president, and the first woman to hold the job. Belgian prime minister Charles Michel is poised to become Council president and Spanish foreign minister Josep Borrell will be the new high representative for foreign affairs. Story continues Serco fine Outsourcing giant Serco ( SRP.L ) has been fined £19.2m, plus £3.7m in costs, as part of a settlement with the Serious Fraud Office (SFO) over fraud and false accounting relating to electronic tagging contracts with the Ministry of Justice. Serco said its UK subsidiary, Serco Geografix, has taken responsibility for the three offences of fraud and two of false accounting committed between 2010 and 2013. The issue was reported by Serco to the SFO in 2013. The settlement sees the lengthy investigations brought to an end without any criminal charges. Serco previously paid a £70m settlement to the Ministry of Justice in December 2013. Telford takeover US real estate services firm CBRE has agreed to buy London-focused house builder Telford Homes ( TEF.L ) in a deal worth £267.4m. The property group — which is listed in New York — said it offered to pay 350p-a-share for Telford, which represents an 11% premium to its closing price on Tuesday. “The board believes that the offer from CBRE represents fair value for shareholders in light of Telford Homes’ market positioning, the current operating environment, and the underlying value of Telford Homes’ site portfolio and pipeline,” Andrew Wiseman, chairman of Telford Homes, said. Telford shares jumped by 11% to 352p at the open. Purplebricks losses jump Online real estate agency Purple Bricks ( PURP.L ) will pull out of the United States, the company announced Wednesday. Operating losses at the firm jumped by 88% to £52.3m in its most recent financial year. The company had already said it would scale back its ambitions in the US in May, when it ousted its CEO and withdrew from the Australian market. The announcement came as part of the company’s latest full-year results. While losses at the firm almost doubled, group revenue was up 55% to £136.5m. Facebook warned on Libra One of Britain’s top regulators has warned Facebook ( FB ) against adopting “a move fast and break things” approach to its new cryptocurrency project Libra. “Historically, this may have been a sector that has lived by the mantra of ‘move fast and break things,’ but the issues raised here require deep thought and detail,” Chris Woolard, the Financial Conduct Authority (FCA)’s executive director of strategy and competition, said in a speech on Tuesday. Separately, members of US Congress wrote to Facebook late on Tuesday calling for Facebook to immediately halt development of Libra “until regulators and Congress have an opportunity to examine these issues and take action.” European stocks solid European stocks were enjoying modest gains on Wednesday morning. The FTSE was helped by a sliding pound, which was weighed down by a gloomy speech from Bank of England governor Mark Carney on Tuesday afternoon. (Many of the Footsie constituents report earnings in dollars, so a weak pound makes share prices look attractive.) Britain's FTSE 100 ( ^FTSE ) was up by 0.5%, Germany's DAX ( ^GDAXI ) was up by 0.5%, France’s CAC 40 ( ^FCHI ) was up by 0.4%, and the Euronext 100 was up by 0.5%. The pound was down by 0.1% against the dollar to $1.257 ( GBPUSD=X ) and flat against the euro at €1.114 ( GBPEUR=X ). The euro was flat against the dollar at $1.128 ( EURUSD=X ). Asian markets dipped overnight. Japan's Nikkei 225 ( ^N225 ) ended down by 0.5%, China's benchmark Shanghai Composite ( 000001.SS ) was down by 0.9%, and the Hong Kong's Hang Seng index ( ^HSI ) was down by 0.2%. What to expect in the US US stock futures were pointing to a higher open later today. S&P 500 futures ( ES=F ) were up by 0.1%, Dow Jones Industrial Average futures ( YM=F ) were up by 0.1%, and Nasdaq futures ( NQ=F ) were up by 0.2%.
What To Know Before Buying Evonik Industries AG (FRA:EVK) For Its Dividend Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Dividend paying stocks like Evonik Industries AG (FRA:EVK) tend to be popular with investors, and for good reason - some research suggests a significant amount of all stock market returns come from reinvested dividends. If you are hoping to live on your dividends, it's important to be more stringent with your investments than the average punter. Regular readers know we like to apply the same approach to each dividend stock, and we hope you'll find our analysis useful. With a five-year payment history and a 4.5% yield, many investors probably find Evonik Industries intriguing. It sure looks interesting on these metrics - but there's always more to the story . There are a few simple ways to reduce the risks of buying Evonik Industries for its dividend, and we'll go through these below. Explore this interactive chart for our latest analysis on Evonik Industries! Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable - hardly an ideal situation. Comparing dividend payments to a company's net profit after tax is a simple way of reality-checking whether a dividend is sustainable. Evonik Industries paid out 58% of its profit as dividends, over the trailing twelve month period. This is a fairly normal payout ratio among most businesses. It allows a higher dividend to be paid to shareholders, but does limit the capital retained in the business - which could be good or bad. Another important check we do is to see if the free cash flow generated is sufficient to pay the dividend. Evonik Industries paid out 73% of its free cash flow last year, which is acceptable, but is starting to limit the amount of earnings that can be reinvested into the business. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously. We update our data on Evonik Industries every 24 hours, so you can always getour latest analysis of its financial health, here. From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. Looking at the data, we can see that Evonik Industries has been paying a dividend for the past five years. During the past five-year period, the first annual payment was €1.00 in 2014, compared to €1.15 last year. This works out to be a compound annual growth rate (CAGR) of approximately 2.8% a year over that time. We like that the dividend hasn't been shrinking. However we're conscious that the company hasn't got an overly long track record of dividend payments yet, which makes us wary of relying on its dividend income. The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. Evonik Industries has grown its earnings per share at 7.9% per annum over the past five years. Earnings per share are growing at an acceptable rate, although the company is paying out more than half of its profits, which we think could constrain its ability to reinvest in its business. When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. First, we think Evonik Industries is paying out an acceptable percentage of its cashflow and profit. Second, earnings growth has been ordinary, and its history of dividend payments is shorter than we'd like. Ultimately, Evonik Industries comes up short on our dividend analysis. It's not that we think it is a bad company - just that there are likely more appealing dividend prospects out there on this analysis. Companies that are growing earnings tend to be the best dividend stocks over the long term. See what the 18 analysts we track are forecasting for Evonik Industriesfor freewith publicanalyst estimates for the company. Looking for more high-yielding dividend ideas? Try ourcurated list of dividend stocks with a yield above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
PrestoDoctor Expands Medical Marijuana Recommendation Telemedicine Service to Missouri MESQUITE, NV / ACCESSWIRE / July 3, 2019 /Cannabis Sativa, Inc. (CBDS) is proud to announce that PrestoDoctor (https://prestodoctor.com/) is now offering their online Medical recommendation services to cannabis patients in the "Show Me" state of Missouri. PrestoDoctor, the #1 patient-rated medical cannabis telemedicine service brings years of experience and compassionate telemedicine care to the emerging Missouri medical cannabis market. The Company's Co-Founder & COO Rob Tankson, shares his excitement about the expansion, stating "our proprietary telemedicine portal is now providing Missouri's cannabis patients easy and confidential access and education with an online appointment with a licensed medical doctor." On November 6, 2018, Missouri voters enacted medical cannabis legalization through Amendment 2 with 61% of the vote. Amendment 2 requires that the state begin taking applications for qualifying patients no later than June 4, 2019. PrestoDoctor has provided medical recommendations to over 100,000 patients in five states. The state of New York and the newly-opened Oklahoma market have exhibited robust demand and the Company expects further growth in 2019 and beyond. About PrestoDoctor: PrestoDoctor launched in California in the summer of 2015, and has since expanded into Nevada, New York, Oklahoma and Missouri. PrestoDoctor has facilitated over a hundred thousand appointments and maintains the highest customer satisfaction rating for any telemedicine service online. PrestoDoctor has over 4,000 5-star reviews, and is the first medical marijuana company to be accepted into the American Telemedicine Association. PrestoDoctor is HIPAA and HITECH compliant. PrestoDoctor plans to continue to expand its services in 2019. About Cannabis Sativa, Inc.: Cannabis Sativa, Inc. ("CBDS") is engaged in the licensing of cannabis related intellectual property, marketing and branding for cannabis based products and services, operation of cannabis related technology services, and ancillary business activities. CBDS licenses the "hi" and "White Rabbit" brands, holds a U.S. patent on the Ecuadorian Sativa strain of Cannabis, a U.S. Patent for a marijuana lozenge; a Cannabis-based pharmaceutical composition for the treatment of hypertensive disorders by submucosal delivery and trade secret formulas and processes, and operates subsidiaries including: PrestoDoctor®(https://prestodoctor.com), Wild Earth Naturals®(https://wildearthnaturals.com), and iBudtender (https://ibudtender.com). The Company is the official licensee for Virgin Mary Jane Brand (https://virginmaryjanebrand.com). In addition, CBDS seeks strategic partners for acquisition of operating companies, intellectual property and other assets which fit within the CBDS corporate vision. Forward-Looking Statements: This press release contains "forward-looking statements." Although the forward-looking statements in this release reflect the good faith judgment of management, forward-looking statements are inherently subject to known and unknown risks and uncertainties that may cause actual results to be materially different from those discussed in these forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in our reports filed with the Securities and Exchange Commission, including the risk factors that attempt to advise interested parties of the risks that may affect our business, financial condition, results of operation and cash flows. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Underlying assumptions include without limitation, the ongoing enactment of legislation favorable to the production of and the commercialization of cannabis products and the Company's success in capitalizing on that legislation. Readers are urged not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. We assume no obligation to update any forward-looking statements in order to reflect any event or circumstance that may arise after the date of this release. Contact Information: Investor RelationsMesquite, NV 89027702-345-4074http://www.cannabissativainc.com SOURCE:Cannabis Sativa, Inc. View source version on accesswire.com:https://www.accesswire.com/550695/PrestoDoctor-Expands-Medical-Marijuana-Recommendation-Telemedicine-Service-to-Missouri
Don't Sell Hiscox Ltd (LON:HSX) Before You Read This Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! This article is for investors who would like to improve their understanding of price to earnings ratios (P/E ratios). We'll apply a basic P/E ratio analysis to Hiscox Ltd's (LON:HSX), to help you decide if the stock is worth further research. Based on the last twelve months,Hiscox's P/E ratio is 48.99. That means that at current prices, buyers pay £48.99 for every £1 in trailing yearly profits. View our latest analysis for Hiscox Theformula for price to earningsis: Price to Earnings Ratio = Share Price (in reporting currency) ÷ Earnings per Share (EPS) Or for Hiscox: P/E of 48.99 = $22.11(Note: this is the share price in the reporting currency, namely, USD )÷ $0.45 (Based on the trailing twelve months to December 2018.) A higher P/E ratio implies that investors paya higher pricefor the earning power of the business. That isn't necessarily good or bad, but a high P/E implies relatively high expectations of what a company can achieve in the future. When earnings fall, the 'E' decreases, over time. That means even if the current P/E is low, it will increase over time if the share price stays flat. A higher P/E should indicate the stock is expensive relative to others -- and that may encourage shareholders to sell. Hiscox's 275% EPS improvement over the last year was like bamboo growth after rain; rapid and impressive. Unfortunately, earnings per share are down 20% a year, over 5 years. One good way to get a quick read on what market participants expect of a company is to look at its P/E ratio. The image below shows that Hiscox has a significantly higher P/E than the average (16.2) P/E for companies in the insurance industry. Hiscox's P/E tells us that market participants think the company will perform better than its industry peers, going forward. Clearly the market expects growth, but it isn't guaranteed. So further research is always essential. I often monitordirector buying and selling. One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. Thus, the metric does not reflect cash or debt held by the company. Theoretically, a business can improve its earnings (and produce a lower P/E in the future) by investing in growth. That means taking on debt (or spending its cash). Such spending might be good or bad, overall, but the key point here is that you need to look at debt to understand the P/E ratio in context. Hiscox has net cash of US$2.1b. This is fairly high at 33% of its market capitalization. That might mean balance sheet strength is important to the business, but should also help push the P/E a bit higher than it would otherwise be. Hiscox has a P/E of 49. That's significantly higher than the average in the GB market, which is 16.3. The excess cash it carries is the gravy on top its fast EPS growth. So based on this analysis we'd expect Hiscox to have a high P/E ratio. When the market is wrong about a stock, it gives savvy investors an opportunity. People often underestimate remarkable growth -- so investors can make money when fast growth is not fully appreciated. So thisfreevisual report on analyst forecastscould hold the key to an excellent investment decision. But note:Hiscox may not be the best stock to buy. So take a peek at thisfreelist of interesting companies with strong recent earnings growth (and a P/E ratio below 20). We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Does Lookers plc's (LON:LOOK) CEO Pay Reflect Performance? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! In 2014 Andy Bruce was appointed CEO of Lookers plc (LON:LOOK). This analysis aims first to contrast CEO compensation with other companies that have similar market capitalization. After that, we will consider the growth in the business. And finally - as a second measure of performance - we will look at the returns shareholders have received over the last few years. This method should give us information to assess how appropriately the company pays the CEO. Check out our latest analysis for Lookers According to our data, Lookers plc has a market capitalization of UK£192m, and pays its CEO total annual compensation worth UK£633k. (This number is for the twelve months until December 2018). We think total compensation is more important but we note that the CEO salary is lower, at UK£368k. We examined companies with market caps from UK£79m to UK£318m, and discovered that the median CEO total compensation of that group was UK£509k. So Andy Bruce is paid around the average of the companies we looked at. This doesn't tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context. You can see a visual representation of the CEO compensation at Lookers, below. Earnings per share at Lookers plc are much the same as they were three years ago, albeit with a positive trend. It achieved revenue growth of 3.9% over the last year. I'd prefer higher revenue growth, but the modest improvement in EPS is good. It's clear the performance has been quite decent, but it it falls short of outstanding,based on this information. You might want to checkthis free visual report onanalyst forecastsfor future earnings. Since shareholders would have lost about 45% over three years, some Lookers plc shareholders would surely be feeling negative emotions. It therefore might be upsetting for shareholders if the CEO were paid generously. Andy Bruce is paid around the same as most CEOs of similar size companies. The company cannot boast particularly strong per share growth. And we think the shareholder returns - over three years - have been underwhelming. So it would take a bold person to suggest the pay is too modest. CEO compensation is one thing, but it is also interesting tocheck if the CEO is buying or selling Lookers (free visualization of insider trades). Of course,you might find a fantastic investment by looking elsewhere.So take a peek at thisfreelist of interesting companies. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Relaxo Footwears Limited (NSE:RELAXO) Is Employing Capital Very Effectively Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Today we'll look at Relaxo Footwears Limited (NSE:RELAXO) and reflect on its potential as an investment. In particular, we'll consider its Return On Capital Employed (ROCE), as that can give us insight into how profitably the company is able to employ capital in its business. Firstly, we'll go over how we calculate ROCE. Next, we'll compare it to others in its industry. Last but not least, we'll look at what impact its current liabilities have on its ROCE. ROCE measures the 'return' (pre-tax profit) a company generates from capital employed in its business. Generally speaking a higher ROCE is better. Ultimately, it is a useful but imperfect metric. Author Edwin Whitingsaysto be careful when comparing the ROCE of different businesses, since 'No two businesses are exactly alike.' The formula for calculating the return on capital employed is: Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities) Or for Relaxo Footwears: 0.23 = ₹2.6b ÷ (₹16b - ₹4.6b) (Based on the trailing twelve months to March 2019.) Therefore,Relaxo Footwears has an ROCE of 23%. See our latest analysis for Relaxo Footwears ROCE can be useful when making comparisons, such as between similar companies. Relaxo Footwears's ROCE appears to be substantially greater than the 12% average in the Luxury industry. We would consider this a positive, as it suggests it is using capital more effectively than other similar companies. Independently of how Relaxo Footwears compares to its industry, its ROCE in absolute terms appears decent, and the company may be worthy of closer investigation. The image below shows how Relaxo Footwears's ROCE compares to its industry, and you can click it to see more detail on its past growth. When considering this metric, keep in mind that it is backwards looking, and not necessarily predictive. ROCE can be misleading for companies in cyclical industries, with returns looking impressive during the boom times, but very weak during the busts. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Since the future is so important for investors, you should check out ourfreereport on analyst forecasts for Relaxo Footwears. Current liabilities include invoices, such as supplier payments, short-term debt, or a tax bill, that need to be paid within 12 months. The ROCE equation subtracts current liabilities from capital employed, so a company with a lot of current liabilities appears to have less capital employed, and a higher ROCE than otherwise. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets. Relaxo Footwears has total assets of ₹16b and current liabilities of ₹4.6b. As a result, its current liabilities are equal to approximately 28% of its total assets. A fairly low level of current liabilities is not influencing the ROCE too much. With that in mind, Relaxo Footwears's ROCE appears pretty good. Relaxo Footwears shapes up well under this analysis,but it is far from the only business delivering excellent numbers. You might also want to check thisfreecollection of companies delivering excellent earnings growth. For those who like to findwinning investmentsthisfreelist of growing companies with recent insider purchasing, could be just the ticket. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Should Hill & Smith Holdings PLC (LON:HILS) Be Part Of Your Dividend Portfolio? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! Could Hill & Smith Holdings PLC (LON:HILS) be an attractive dividend share to own for the long haul? Investors are often drawn to strong companies with the idea of reinvesting the dividends. If you are hoping to live on the income from dividends, it's important to be a lot more stringent with your investments than the average punter. A slim 2.7% yield is hard to get excited about, but the long payment history is respectable. At the right price, or with strong growth opportunities, Hill & Smith Holdings could have potential. Some simple analysis can reduce the risk of holding Hill & Smith Holdings for its dividend, and we'll focus on the most important aspects below. Explore this interactive chart for our latest analysis on Hill & Smith Holdings! Dividends are typically paid from company earnings. If a company pays more in dividends than it earned, then the dividend might become unsustainable - hardly an ideal situation. So we need to form a view on if a company's dividend is sustainable, relative to its net profit after tax. In the last year, Hill & Smith Holdings paid out 53% of its profit as dividends. This is a fairly normal payout ratio among most businesses. It allows a higher dividend to be paid to shareholders, but does limit the capital retained in the business - which could be good or bad. In addition to comparing dividends against profits, we should inspect whether the company generated enough cash to pay its dividend. The company paid out 63% of its free cash flow, which is not bad per se, but does start to limit the amount of cash Hill & Smith Holdings has available to meet other needs. It's encouraging to see that the dividend is covered by both profit and cash flow. This generally suggests the dividend is sustainable, as long as earnings don't drop precipitously. We update our data on Hill & Smith Holdings every 24 hours, so you can always getour latest analysis of its financial health, here. From the perspective of an income investor who wants to earn dividends for many years, there is not much point buying a stock if its dividend is regularly cut or is not reliable. For the purpose of this article, we only scrutinise the last decade of Hill & Smith Holdings's dividend payments. During the past ten-year period, the first annual payment was UK£0.094 in 2009, compared to UK£0.32 last year. Dividends per share have grown at approximately 13% per year over this time. Dividends have been growing pretty quickly, and even more impressively, they haven't experienced any notable falls during this period. The other half of the dividend investing equation is evaluating whether earnings per share (EPS) are growing. Growing EPS can help maintain or increase the purchasing power of the dividend over the long run. It's good to see Hill & Smith Holdings has been growing its earnings per share at 15% a year over the past 5 years. Earnings per share have been growing rapidly, but given that it is paying out more than half of its earnings as dividends, we wonder how Hill & Smith Holdings will keep funding its growth projects in the future. When we look at a dividend stock, we need to form a judgement on whether the dividend will grow, if the company is able to maintain it in a wide range of economic circumstances, and if the dividend payout is sustainable. Hill & Smith Holdings's is paying out more than half its income as dividends, but at least the dividend is covered by both reported earnings and cashflow. We like that it has been delivering solid improvement in its earnings per share, and relatively consistent dividend payments. Overall we think Hill & Smith Holdings is an interesting dividend stock, although it could be better. Earnings growth generally bodes well for the future value of company dividend payments. See if the 6 Hill & Smith Holdings analysts we track are forecasting continued growth with ourfreereport on analyst estimates for the company. If you are a dividend investor, you might also want to look at ourcurated list of dividend stocks yielding above 3%. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
Do Insiders Own Lots Of Shares In Hexatronic Group AB (publ) (STO:HTRO)? Want to participate in ashort research study? Help shape the future of investing tools and you could win a $250 gift card! A look at the shareholders of Hexatronic Group AB (publ) (STO:HTRO) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.' Hexatronic Group is a smaller company with a market capitalization of kr1.9b, so it may still be flying under the radar of many institutional investors. Taking a look at our data on the ownership groups (below), it's seems that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about HTRO. See our latest analysis for Hexatronic Group Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing. We can see that Hexatronic Group does have institutional investors; and they hold 35% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Hexatronic Group's earnings history, below. Of course, the future is what really matters. It looks like hedge funds own 13% of Hexatronic Group shares. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track. The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves. Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances. Our most recent data indicates that insiders own a reasonable proportion of Hexatronic Group AB (publ). Insiders have a kr278m stake in this kr1.9b business. This may suggest that the founders still own a lot of shares. You canclick here to see if they have been buying or selling. With a 34% ownership, the general public have some degree of sway over HTRO. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies. Our data indicates that Private Companies hold 4.8%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company. While it is well worth considering the different groups that own a company, there are other factors that are even more important. I like to dive deeperinto how a company has performed in the past. You can findhistoric revenue and earnings in thisdetailed graph. If you would prefer discover what analysts are predicting in terms of future growth, do not miss thisfreereport on analyst forecasts. NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures. We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.If you spot an error that warrants correction, please contact the editor [email protected]. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.

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