Top 5 Warren Buffett Stocks To Own Right Now

tags:SHOP,POT,CAT,PEB,FCAU,

Just how contrarian are you? How to know when the onrushing herd has it right? When following Warren Buffett's credo to be greedy when others are fearful, where's the line between brave and foolhardy?

These are the self-directed questions of an investor today mulling Wall Street's most-hated trade: owning the classic American consumer-staples stocks.

Exactly how much does Wall Street hate the packaged-food and household-products group? Let's count the ways:

The shares of Campbell Soup, General Mills, Kraft Heinz, Procter & Gamble, Colgate-Palmolive and Clorox are down between 17 and 30 percent year to date, compared with a slight gain for the S&P 500. Aside from Kraft Heinz, those stocks currently carry buy ratings from one-third or fewer of the analysts who cover them versus a bit more than 50 percent buys among all large-cap stocks. Goldman Sachs strategists calculate that hedge funds collectively have a bigger bet shorting the consumer-staples stocks than owning them. An already disliked group got another kick Friday with Campbell Soup's lousy results accompanying the hasty departure of its CEO of seven years, Denise Morrison. She joins the former heads of Mondelez and General Mills in a gust of CEO turnover atop Big Food, a sign that the operating climate itself is forcing abrupt change.

Top 5 Warren Buffett Stocks To Own Right Now: Shopify Inc.(SHOP)

Advisors' Opinion:

• [By Neha Chamaria, Jason Hall, and Dan Caplinger]

  Shopify (NYSE:SHOP) is the poster boy for growth stocks: Shares of the cloud-based e-commerce platform have returned a staggering 441% since listing in mid-2015. It's not easy to replicate those returns, but that doesn't mean there aren't other stocks out there with similar or even greater returns potential.

• [By Jon C. Ogg]

  Shopify Inc. (NYSE: SHOP) was up 1.4% at $175.55 on Tuesday in reaction to earnings and shares were indicated up another 2% at $179.00 on Wednesday. RBC Capital Markets upgraded it to Outperform from Sector Perform and raised the target price to $230 from $180. Wedbush Securities reiterated its Outperform rating and $200 price target, noting that Shopify is well positioned to keep gaining its share of e-commerce wallets over time and to capture more merchants across the entire spectrum of size from aspirational to established companies to enterprise level.

• [By Jim Crumly]

  As for individual stocks, Pfizer (NYSE:PFE) fell on a top-line miss and shares of Shopify (NYSE:SHOP) dropped despite the company reporting a strong quarter.

• [By Rich Duprey, Rich Smith, and Travis Hoium]

  Since going public in mid-2015, e-commerce platform developer Shopify (NYSE:SHOP) has nearly quintupled in value, for around a 60% annual compounded growth rate. Of course, predicting those kinds of returns is impossible, but Shopify's business model represents a unique opportunity that hit the market at just the right time.

• [By Chris Lange]

  Shopify Inc. (NYSE: SHOP) released its most recent quarterly report before the markets opened on Thursday. The company said that it had a net loss of $0.03 per share on $222.8 million in revenue, compared with consensus estimates that called for earnings of $0.05 per share $209.28 million in revenue. The same period of last year reportedly had no earnings and revenue of $130.38 million in.

Top 5 Warren Buffett Stocks To Own Right Now: Potash Corporation of Saskatchewan Inc.(POT)

Advisors' Opinion:

• [By Joseph Griffin]

  PotCoin (CURRENCY:POT) traded 0.6% higher against the US dollar during the 24 hour period ending at 23:00 PM E.T. on May 12th. PotCoin has a total market capitalization of $23.95 million and approximately $62,522.00 worth of PotCoin was traded on exchanges in the last 24 hours. During the last seven days, PotCoin has traded 17.8% lower against the US dollar. One PotCoin coin can now be purchased for approximately $0.11 or 0.00001293 BTC on popular cryptocurrency exchanges including Cryptopia, CoinExchange, Trade By Trade and Tux Exchange.

• [By Ethan Ryder]

  Headlines about Potash Co. of Saskatchewan (NYSE:POT) (TSE:POT) have trended positive this week, according to Accern Sentiment Analysis. The research group rates the sentiment of news coverage by reviewing more than twenty million news and blog sources. Accern ranks coverage of public companies on a scale of negative one to positive one, with scores nearest to one being the most favorable. Potash Co. of Saskatchewan earned a news impact score of 0.43 on Accern’s scale. Accern also gave media coverage about the fertilizer maker an impact score of 45.4285202328488 out of 100, meaning that recent news coverage is somewhat unlikely to have an impact on the stock’s share price in the next few days.

• [By Shane Hupp]

  Media stories about Potash Co. of Saskatchewan (NYSE:POT) (TSE:POT) have trended somewhat positive recently, Accern reports. The research firm ranks the sentiment of news coverage by reviewing more than twenty million blog and news sources. Accern ranks coverage of publicly-traded companies on a scale of negative one to one, with scores closest to one being the most favorable. Potash Co. of Saskatchewan earned a daily sentiment score of 0.23 on Accern’s scale. Accern also gave media coverage about the fertilizer maker an impact score of 45.852138495875 out of 100, meaning that recent news coverage is somewhat unlikely to have an effect on the company’s share price in the next few days.

• [By Max Byerly]

  PotCoin (CURRENCY:POT) traded 4% lower against the U.S. dollar during the 24-hour period ending at 0:00 AM Eastern on June 4th. PotCoin has a total market capitalization of $18.72 million and approximately $73,221.00 worth of PotCoin was traded on exchanges in the last 24 hours. In the last seven days, PotCoin has traded up 2.6% against the U.S. dollar. One PotCoin coin can now be purchased for approximately $0.0850 or 0.00001147 BTC on exchanges including CoinExchange, Tux Exchange, Trade By Trade and Bleutrade.

Top 5 Warren Buffett Stocks To Own Right Now: Caterpillar, Inc.(CAT)

Advisors' Opinion:

• [By Ethan Ryder]

  Get a free copy of the Zacks research report on Caterpillar (CAT)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Ethan Ryder]

  Get a free copy of the Zacks research report on Caterpillar (CAT)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Paul Ausick]

  Caterpillar Inc. (NYSE: CAT) traded up 2.13% at $159.02. The stock’s 52-week range is $101.81 to $173.24. Volume was about equal to the daily average of around 5.4 million. The company had no specific news today, but another big exporter gets a bump from the easing of tensions with China.

• [By ]

  U.S. stocks finished sharply lower on Tuesday as earnings from Caterpillar Inc. (CAT) , despite rising, disappointed investors as the heavy machinery maker said material cost increases this year likely will come in above estimates because of higher steel prices.

• [By Paul Ausick]

  The second-worst Dow stock so far this year is Goldman Sachs Group Inc. (NYSE: GS), which is down 16.1%. That is followed by 3M Co. (NYSE: MMM), down 15.8%, Procter & Gamble Co. (NYSE: PG), down 14%, and Caterpillar Inc. (NYSE: CAT), down 9.8%. Of the 30 Dow stocks, 14 trade lower so far in 2018.

• [By Paul Ausick]

  The Dow stock posting the largest daily percentage gain ahead of the close Friday was Caterpillar Inc. (NYSE: CAT) which traded up 2.47% at $139.63 in a 52-week range of $112.69 to $173.24. Volume was about 20% above the daily average of around 4.4 million shares.

Top 5 Warren Buffett Stocks To Own Right Now: Pebblebrook Hotel Trust(PEB)

Advisors' Opinion:

• [By Logan Wallace]

  Get a free copy of the Zacks research report on Pebblebrook Hotel (PEB)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Max Byerly]

  Get a free copy of the Zacks research report on Pebblebrook Hotel Trust (PEB)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Max Byerly]

  Pebblebrook Hotel Trust (NYSE:PEB) has received a consensus rating of “Hold” from the thirteen research firms that are currently covering the firm, MarketBeat Ratings reports. Two research analysts have rated the stock with a sell rating, four have given a hold rating and six have given a buy rating to the company. The average 1 year price objective among brokers that have issued ratings on the stock in the last year is $36.19.

Top 5 Warren Buffett Stocks To Own Right Now: Fiat Chrysler Automobiles N.V.(FCAU)

Advisors' Opinion:

• [By Paul Ausick]

  Of the Detroit Three, Fiat Chrysler Automobiles N.V. (NYSE: FCAU) saw its January market share in the EU dip from 6.7% in 2018 to 6.0%. Unit sales totaled 71,310, down by 14.9% year over year. Sales of the Fiat brand fell by 19.6%, while Jeep sales dropped by 1.9%.

• [By Rich Duprey]

  The aftermarket segment remains the real weak spot for the powersports vehicle manufacturer. I was never very keen on the acquisition in part because it bought into a weakening market for Jeeps and light-duty trucks. Despite the massive 45% gain Fiat Chrysler (NYSE:FCAU) scored in Jeep sales in March (it was the brand's biggest gain ever), sales had been down 11% in 2017 as fleet sales were reduced, suggesting TAP's performance for Polaris could be a volatile one.

• [By Elizabeth Balboa]

  The correlation is meaningful to companies like General Motors Company (NYSE: GM) and Fiat Chrysler Automobiles NV (NYSE: FCAU), both of which have long shifted investment from passenger cars toward higher-margin and better-selling trucks and SUVs.

• [By Danny Vena]

  Waymo, the self-driving subsidiary of Google-parent Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG), took its first delivery of 100 Chrysler Pacifica minivans supplied by Fiat Chrysler Automobiles (NYSE:FCAU) in December of 2016, adding an additional 500 to its corral in April 2017. Earlier this year, the companies announced that Waymo would be adding "thousands" more minivans to its fleet, though it didn't specify how many. 

• [By Ethan Ryder]

  Shares of Fiat Chrysler Automobiles (NYSE:FCAU) gapped up before the market opened on Thursday . The stock had previously closed at $20.62, but opened at $21.17. Fiat Chrysler Automobiles shares last traded at $21.39, with a volume of 6406287 shares traded.

• [By Garrett Baldwin]

  Markets have been under pressure once again by the U.S. Federal Reserve. Inflation levels are going through the roof… but the people in charge of managing it have been lying to Americans for years. Now it's time to get even. Money Morning Liquidity Specialist Lee Adler has the perfect way to make a lot of money when no one is looking. Read it here.

  The Top Stock Market Stories for Tuesday Despite all of the political noise, both China and the United States have agreed to take a step back and seriously pursue talks that may prevent further tariff impositions. The biggest development on the trade front is that the Trump administration is considering a plan to lift a sales ban on Chinese mobile giant ZTE. Shares of Micron Technology Inc. (Nasdaq: MU) are pushing higher after the company announced a $10 billion plan to buy back stock. Micron reported earnings on Monday, and the Boise-based firm easily topped Wall Street expectations. Facebook Inc. (Nasdaq: FB) was pushing a bit higher on Tuesday as the firm prepared to address data privacy issues in Europe. The social media giant's CEO, Mark Zuckerberg, is set to speak before European lawmakers this morning. Zuckerberg will testify this morning, just three days after the European Union enforced more stringent laws on consumer data protection. Three Stocks to Watch Today: GM, KSS, TSLA Shares of General Motors Co. (NYSE: GM) were pushing higher after the auto giant reported that China will be lifting restrictions on U.S. automotive parts and cars. But GM isn't the only beneficiary. Look for shares of Ford Motor Co. (NYSE: F) and Fiat Chrysler Automobiles NV (Nasdaq: FCAU) to also get a boost out of the Chinese economy. Shares of Kohl's Corp. (NYSE: KSS) popped 5% after the firm beat earnings expectations and easily topped same-store sales during the first quarter. The company also raised its 2019 earnings numbers, which helped fuel investor sentiment. Shares of Tesla Inc. (Nasdaq: TSLA) are in focus

Is Acceleron Pharma a Buy?

Drug development is a risky endeavor. So when a small-cap company with a promising pipeline brings in a deep-pocketed partner to front development and commercialization expenses, then announces its lead drug candidate shined in two late-stage trials, investors should be able breathe a sigh of relief. But despite recent success in the clinic, Acceleron Pharma (NASDAQ:XLRN) hasn't been able to put uncertainty behind it just yet.

The $2 billion development-stage company and Celgene (NASDAQ:CELG) partnered to develop the red blood cell-boosting treatment luspatercept. Positive results in multiple phase 3 trials in 2018 stoked confidence that the drug candidate could become the preferred treatment option for certain blood disorders that typically require blood transfusions. Some even speculated Celgene would move to acquire its partner, which wasn't entirely out of the question considering it already owns a roughly 13% stake.

(Image Source: Getty Images)

Little did investors know Celgene would be the company getting gobbled up -- for a cool $74 billion offered by Bristol-Myers Squibb in early 2019. That likely means Acceleron Pharma will remain a stand-alone company for the foreseeable future, as does a recent share offering that stuffed $264 million in gross proceeds into the company's coffers. Assuming an exit through Celgene is off the table, should investors with a long-term mind-set consider the stock a buy? 

Luspatercept has blockbuster potential

Acceleron Pharma and Celgene are on track to file for marketing approval from the U.S. Food and Drug Administration (FDA) of luspatercept during the first half of 2019, and it appears likely to succeed.

The drug candidate is being developed as a treatment for myelodysplastic syndromes (MDS), beta-thalassemia, and myelofibrosis -- blood disorders characterized by abnormal red blood cell development. Patients with late stages of the diseases have to undergo frequent and costly blood transfusions to address the deficiency. While treatment works, complications can significantly reduce quality of life.

Results from multiple phase 3 trials investigating luspatercept have suggested a promising future for patients. The Medalist (MDS) and Believe (beta-thalassemia) trials showed individuals taking the drug candidate could create meaningfully more healthy red blood cells on their own and the need for blood transfusions was significantly reduced over long periods of time. If luspatercept becomes the go-to treatment option in the United States and Europe, then Acceleron Pharma thinks it can reach peak annual sales of more than $2 billion. 

A promising pipeline is an expensive pipeline

Luspatercept seems likely to earn marketing approval from the FDA. While Celgene must pay for commercialization and marketing costs, Acceleron Pharma stands to receive significant milestone payments (up to $211 million total at the time the partnership was announced in 2011), split profits on North American sales, and low- to mid-20% royalties on European sales. It figures to be a pretty sweet deal for the development-stage company.

That said, management is already beginning to dedicate more bandwidth to the rest of the pipeline. Acceleron Pharma has four ongoing or planned phase 2 trials for two additional drug candidates: ACE-083 in neuromuscular disorders and sotatercept in pulmonary arterial hypertension (PAH). None of the programs are currently partnered, which hints operating expenses are about to rise significantly.

That will be an area for investors to watch, especially considering in the first nine months of 2018, the business delivered an operating loss of $87 million, operating cash outflows of $66 million, and a 15% increase in research and development expenses compared to the same period last year. 

It should be no surprise, that the business has been accumulating cash lately, exiting September 2018 with cash, cash equivalents, and short-term investments of nearly $320 million. Add that to $260 million in gross proceeds from Acceleron's recent share offering, and the $2 billion company should have around $500 million in cash, cash equivalents, and short-term investments at the end of the first quarter of 2019. 

That suggests cash won't be an issue for Acceleron Pharma anytime soon, which is especially true if luspatercept earns marketing approval and hits the ground running in 2020. However, the company stated it may use some of the proceeds from its recent share offering for the "potential acquisitions of rights to additional programs from third parties." That could mean anything, but investors may want to consider the company might buy out Celgene's rights to sotatercept in PAH.

Image Source: Getty Images

Sotatercept was originally developed by Acceleron Pharma, then licensed to Celgene for study in a variety of diseases, but the originator reacquired the rights in PAH in late 2017 after discovering the drug candidate's disease-modifying potential. Individuals with PAH suffer from constricted lung arteries marked by significantly elevated blood pressure within their lungs. The debilitating disease makes daily activities cause shortness of breath, and the five-year survival rate is a sobering 57%. Acceleron Pharma thinks sotatercept has the potential to turn PAH into a manageable disease, though that judgment is based on animal data alone. 

Nonetheless, if Acceleron Pharma can buy out Celgene before results are announced from the ongoing phase 2 trial in early 2020, and the midstage study corroborates findings from promising animal studies (which often don't hold up in humans), then the company could have another potential blockbuster on its hands. PAH treatments have annual sales of $4 billion in the United States. And since sotatercept works through a unique mechanism of action, it could be combined with existing treatment options, potentially increasing its market potential beyond the existing opportunity. 

Acceleron Pharma has a favorable risk-reward profile

Investors with a long-term mindset should feel relatively comfortable with a position in Acceleron Pharma. The market potential for luspatercept is significant, and the drug's launch might be a key area of focus for growth-hungry Bristol-Myers Squibb once the dust settles from its Celgene acquisition.

If the drug is successfully commercialized, then Acceleron Pharma would significantly de-risk the development of its remaining clinical assets, including the under-the-radar drug candidate sotatercept in PAH. While the asset has yet to prove its worth in the clinic, Acceleron Pharma found its potential significant enough to reacquire the development and commercialization rights from Celgene in late 2017.

Now flush with cash, and with midstage data for the drug candidate on the way in the first half of 2020, investors should be intrigued by the possibility that Acceleron Pharma won't be a one-trick pony for much longer. That could mean the stock has more upside than Wall Street, which is currently focused on luspatercept alone, expects.

Will This Regulation Derail Amazon in India?

Amazon.com (NASDAQ:AMZN) stock took a haircut after the company's fourth-quarter results were released. Wall Street was disappointed with the e-commerce giant's guidance as it calls for first-quarter sales growth of 14% at the midpoint, while analysts were looking for a 19% jump. But that was not the only bad news for shareholders on earnings day.

This is definitely not what Amazon wanted

Amazon has been hit hard by a change in e-commerce regulations in India that came into effect Feb. 1. According to a note issued by India's Department of Industrial Policy and Promotion, e-commerce players with foreign investments cannot hold stakes in wholesale companies that sell on their marketplaces. Additionally, retail companies cannot get more than 25% of sales from just one platform.  

Unnamed sources told the Economic Times that sales via Amazon and Flipkart dropped by a third following the policy changes.

Amazon has been forced to pull product listings from its Indian site as it relied on two sellers -- Cloudtail and Appario Retail -- for the majority of its sales. Amazon holds a 49% stake in both of these entities, which means that it cannot sell inventory owned by them anymore. As Cloudtail was reportedly supplying around 40% of Amazon's sales, the e-commerce giant's India sales are surely taking a massive hit right now.

Image source: Getty Images.

The implications

India's fast-growing smartphone and internet penetration have been driving rapid e-commerce growth in the country, and the market is expected to reach $200 billion in sales by 2026. Amazon didn't want to miss this gravy train so it committed billions of dollars to make a mark in India's e-commerce space.

More importantly, the company's investments were paying off nicely, and by the end of 2017 it had nearly tripled its share of India's e-commerce market in just three years. But the latest regulations are expected to put the brakes on India's e-commerce growth story. Consulting giant PricewaterhouseCoopers estimates that the regulatory changes could lead to a $46 billion drop in online sales in India by 2022.

That could knock the wind out of Amazon's India sales and hurt the company in the long run as it now gets 30% of its revenue from international operations. Amazon doesn't explicitly mention how much revenue it gets from India, but it can be safe to assume that this market would have been a solid long-term growth driver.

Amazon's international revenue increased 15% year over year during the final quarter of 2018, down from the 29% growth it had clocked in the year-ago period.

What next?

But all is not lost for Amazon as it's looking to find a way out of this mess by restructuring its India operations. The company is reportedly exploring a conversion of Cloudtail and Appario into wholesale entities that will be engaged in business-to-business transactions, selling their goods to other third-party sellers that will then make the final sale to consumers.

People with knowledge of the matter, as reported by the Economic Times, have said that category managers at Amazon are already in the process of looking for preferred sellers who will buy goods from Appario and Cloudtail. Alternatively, reports suggest that Amazon could offload its stake in both these entities so that it can continue selling through them.

In all, Amazon seems to be confident that the change won't affect its India operations as Cloudtail and Appario haven't canceled any purchase orders just yet. However, it remains to be seen how Amazon copes with the latest regulatory challenge thrown its way by the Indian government.

Top Growth Stocks To Own For 2019

tags:RLGY,VEEV,HSBA, Britain has registered its first rise in unemployment since the Brexit referendum in 2016.

The increase in the jobless rate to 4.4% surprised economists, and the pound dropped by about 0.6% against the dollar as investors pondered whether the new data could delay the next rise in UK interest rates.

In the three months to December, 46,000 people were added to the unemployment tally, representing the biggest increase since early 2013. It took the total to 1.47 million.

Despite the rise, the unemployment rate remains just 0.1 percentage points above its lowest levels in decades.

Growth in the UK economy slowed last year, partly because of uncertainty over the outcome of negotiations on the future trade relationship with the European Union after Brexit takes effect in March 2019.

At the same time, British companies continue to create new jobs. There were 823,000 vacancies in the three months to January 2018, 70,000 more than at the same time last year.

Top Growth Stocks To Own For 2019: Realogy Holdings Corp.(RLGY)

Advisors' Opinion:

• [By Stephan Byrd]

  Canada Pension Plan Investment Board decreased its position in shares of Realogy Holdings Corp (NYSE:RLGY) by 0.4% in the 2nd quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission. The institutional investor owned 7,600,000 shares of the financial services provider’s stock after selling 33,100 shares during the period. Canada Pension Plan Investment Board owned about 0.06% of Realogy worth $173,280,000 as of its most recent filing with the Securities and Exchange Commission.

• [By Stephan Byrd]

  Realogy Holdings Corp (NYSE:RLGY) has been given an average recommendation of “Hold” by the eleven ratings firms that are currently covering the stock, Marketbeat.com reports. Five investment analysts have rated the stock with a sell recommendation, one has issued a hold recommendation and four have assigned a buy recommendation to the company. The average 1 year price target among brokerages that have issued a report on the stock in the last year is $32.29.

• [By Shane Hupp]

  Realogy (NYSE:RLGY) had its target price trimmed by Citigroup from $37.00 to $35.00 in a report released on Friday morning. The firm currently has a buy rating on the financial services provider’s stock.

• [By Max Byerly]

  Old Mutual Global Investors UK Ltd. trimmed its holdings in Realogy Holdings Corp (NYSE:RLGY) by 11.2% in the first quarter, HoldingsChannel.com reports. The fund owned 2,142,930 shares of the financial services provider’s stock after selling 269,939 shares during the period. Old Mutual Global Investors UK Ltd.’s holdings in Realogy were worth $58,459,000 at the end of the most recent quarter.

• [By Max Byerly]

  Get a free copy of the Zacks research report on Realogy (RLGY)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Ethan Ryder]

  Realogy Holdings Corp (NYSE:RLGY)’s share price hit a new 52-week low during trading on Friday . The stock traded as low as $20.02 and last traded at $21.29, with a volume of 184103 shares changing hands. The stock had previously closed at $21.82.

Top Growth Stocks To Own For 2019: Veeva Systems Inc.(VEEV)

Advisors' Opinion:

• [By Shane Hupp]

  Veeva Systems Inc (NYSE:VEEV) insider Eleni Nitsa Zuppas sold 7,200 shares of the stock in a transaction dated Tuesday, September 11th. The stock was sold at an average price of $103.30, for a total transaction of $743,760.00. Following the sale, the insider now owns 12,398 shares of the company’s stock, valued at approximately $1,280,713.40. The sale was disclosed in a document filed with the SEC, which can be accessed through this link.

• [By Lisa Levin]

   

  Companies Reporting After The Bell Ross Stores, Inc. (NASDAQ: ROST) is projected to post quarterly earnings at $1.07 per share on revenue of $3.54 billion. Autodesk, Inc. (NASDAQ: ADSK) is expected to post quarterly earnings at $0.03 per share on revenue of $557.65 million. Gap, Inc. (NYSE: GPS) is projected to post quarterly earnings at $0.46 per share on revenue of $3.60 billion. Quality Systems, Inc. (NASDAQ: QSII) is estimated to post quarterly earnings at $0.13 per share on revenue of $131.95 million. Splunk Inc. (NASDAQ: SPLK) is expected to post quarterly loss at $0.09 per share on revenue of $297.67 million. Shoe Carnival, Inc. (NASDAQ: SCVL) is projected to post quarterly earnings at $0.71 per share on revenue of $262.02 million. Deckers Outdoor Corporation (NYSE: DECK) is expected to post quarterly earnings at $0.19 per share on revenue of $375.41 million. Zoe's Kitchen, Inc. (NYSE: ZOES) is estimated to post quarterly loss at $0.01 per share on revenue of $105.30 million. DXC Technology Company (NYSE: DXC) is expected to post quarterly earnings at $2.23 per share on revenue of $6.12 billion. 8x8, Inc. (NASDAQ: EGHT) is estimated to post quarterly loss at $0.05 per share on revenue of $76.93 million. Viasat, Inc. (NASDAQ: VSAT) is projected to post quarterly loss at $0.45 per share on revenue of $424.46 million. ePlus inc. (NASDAQ: PLUS) is estimated to post quarterly earnings at $1.01 per share on revenue of $1.60 billion. Lions Gate Entertainment Corp. (NYSE: LGF.A) is expected to post quarterly loss at $0.04 per share on revenue of $1.04 billion. Agilysys, Inc. (NASDAQ: AGYS) is estimated to post quarterly loss at $0.08 per share on revenue of $32.58 million. Nutanix, Inc. (NASDAQ: NTNX) is estimated to post quarterly loss at $0.19 per share on revenue of $278.98 million. Veeva Systems Inc. (NYSE: VEEV) is projected to post quarterly earnings at $0.31 per share on revenue
• [By Dan Caplinger]

  Friday saw a breakout session for the stock market, as major benchmarks like the S&P 500 and the Nasdaq Composite set record highs. For the broad-based S&P 500, the record was the first it had set since early this year, and for many investors, it served as confirmation that the bull market in stocks could continue as it approaches its 10th anniversary in early 2019. Several positive news items from individual companies also helped lead indexes higher. Netflix (NASDAQ:NFLX), Autodesk (NASDAQ:ADSK), and Veeva Systems (NYSE:VEEV) were among the best performers on the day. Here's why they did so well.

Top Growth Stocks To Own For 2019: HSBC Holdings PLC (HSBA)

Advisors' Opinion:

• [By Max Byerly]

  HSBC Holdings plc (LON:HSBA) has received an average recommendation of “Hold” from the sixteen analysts that are covering the company, MarketBeat Ratings reports. Two investment analysts have rated the stock with a sell recommendation, ten have issued a hold recommendation and four have assigned a buy recommendation to the company. The average 12-month price objective among brokerages that have issued a report on the stock in the last year is GBX 768.33 ($9.80).

• [By Joseph Griffin]

  HSBC (LON:HSBA) had its target price lowered by equities research analysts at Shore Capital from GBX 721 ($9.60) to GBX 625 ($8.32) in a report issued on Tuesday. The brokerage presently has a “sell” rating on the financial services provider’s stock. Shore Capital’s price objective indicates a potential downside of 14.71% from the company’s previous close.

• [By Max Byerly]

  Credit Suisse Group set a GBX 720 ($9.32) price target on HSBC (LON:HSBA) in a research report sent to investors on Tuesday morning. The firm currently has a neutral rating on the financial services provider’s stock.

• [By Ethan Ryder]

  HSBC (LON:HSBA) had its price target dropped by equities research analysts at Citigroup from GBX 810 ($10.78) to GBX 800 ($10.65) in a report released on Tuesday. The brokerage currently has a “buy” rating on the financial services provider’s stock. Citigroup’s price target points to a potential upside of 9.59% from the stock’s previous close.

• [By Max Byerly]

  HSBC (LON:HSBA) was upgraded by equities research analysts at Credit Suisse Group to a “neutral” rating in a research report issued to clients and investors on Thursday. The firm presently has a GBX 720 ($9.38) target price on the financial services provider’s stock, up from their previous target price of GBX 680 ($8.86). Credit Suisse Group’s price target suggests a potential upside of 5.82% from the company’s previous close.

• [By Stephan Byrd]

  Morgan Stanley set a GBX 855 ($10.91) price target on HSBC (LON:HSBA) in a research note issued to investors on Tuesday. The brokerage currently has a buy rating on the financial services provider’s stock.

Why Did CenturyLink Decide to Cut Its Dividend?

CenturyLink (NYSE:CTL) shareholders got some unwelcome news last week...

... or did they?

On the company's fourth-quarter earnings conference call, management disclosed it would be cutting the telecom service provider's annual dividend from $2.16 to $1.00 per share. CenturyLink's share price had declined a lot since summer, driving its dividend yield over 15%, so clearly some investors anticipated this possibility. Even after the cut, CenturyLink's yield stands at over 7%.

Still, many were surprised, since management had regularly expressed confidence in the dividend throughout 2018, and the company's free cash flow handily covered the payout. So why did management make this decision?

CenturyLink's dividend cut irked some investors. Image source: Getty Images.

What management had to say

On the company's earnings call, CEO Jeff Storey said:

... this change in policy isn't about a diminished view of our business. It is driven by our view that the long-term interests of shareholders are best served by proactively accelerating delevering to a new lower target range of 2.75 to 3.25 times net-debt to adjusted EBITDA ... By reallocating more of our capital to leverage reduction, we believe [we] will improve our cost of capital, return a significant amount of cash to shareholders at a very sustainable payout ratio, and provide additional flexibility to respond to market opportunities and any potential interest rate challenges that may occur.

In essence, management thinks even though CenturyLink could preserve the dividend, it would be better for the long-term health of the business to invest in the network, lower the company's $36 billion debt load, or make potential acquisitions. CenturyLink is also still saddled with some legacy copper-based products, such as landline phones and slower internet. Those headwinds are currently more than offsetting the company's fiber-based growth businesses, leading to current revenue declines on an overall basis.

The new debt-to-EBITDA (earnings before interest, taxes, depreciation, and amortization) range is a three-year target, reflecting not only the debt paydown, but also EBITDA growth from investments in new products and capabilities.

An analyst pushes back

Many investors, and at least one analyst, may have been confused by management's decision, especially in light of pretty decent 2019 guidance. For the upcoming year, CenturyLink guided to a slight increase in adjusted EBITDA, from $8.94 billion last year to a range of $9.0 billion-$9.2 billion in 2019. However, the company's free cash flow guidance was $3.1 billion-$3.4 billion, down from this year's adjusted free cash flow of $4.22 billion, due to increased capital expenditures and the comparative effect of a lowered tax expense in 2018. Still, that free cash flow guidance would have handily covered the old $2.3 billion dividend payout -- though as we'll see below, just covering the dividend payout doesn't tell the whole story. 

Analyst David Barden of Bank of America pushed back on management's decision to pay down debt early, asking, "...between the $6 billion of cash flow that you're gonna generate and the $3.6 billion of debt that matures and everything's trading above par, [it] doesn't really make sense to pay it down early."

Barden's point was that while CenturyLink has over $36 billion in debt, only $3.6 billion matures over the next three years. Those bonds are all trading "above par," meaning that bond investors did not appear worried about CenturyLink's ability to service that debt.

I'm not sure Barden's numbers were correct, unless something has changed since CenturyLink's last quarterly report. As of its third-quarter report, it looks like roughly $5 billion is set to mature in that time frame, with another $5.3 billion due the following year in 2022.

Year

CenturyLink Long-Term Debt Maturities (in millions)

2019	$651
2020	$1,202
2021	$3,115
2022	$5,323
2023 and thereafter	$25,785

Data source: CenturyLink Q3 10Q. Table by author.

Of course, CenturyLink doesn't necessarily have to pay all debt when due, if it can refinance it with new notes. However, given the rising interest rate environment and the market dislocation in December, it appears management didn't want to take that risk. If a company needs to refinance a lot of debt, there's no guarantee it will obtain the interest rate it likes, and if there's a market crash, debt markets may not be open at all.

CFO Neel Dev said, "Our view is paying down about a couple billion of long-term obligations per year over the next three years makes sense, but you have a different view." 

Safety first

While it appears CenturyLink had the ability to pay the old dividend, reduce debt, and invest in its network, management apparently decided things were too close for comfort and is taking pre-emptive action. While dividend-focused investors are likely disappointed, the de-risking of the business was likely the safest move. Removing the debt maturity risk overhang could even help CenturyLink's flailing share price in the medium term, which investors shouldn't mind at all.

Stock Buyback Program Approved by Cisco Systems (CSCO) Board

Cisco Systems (NASDAQ:CSCO) announced that its Board of Directors has initiated a stock buyback program, which permits the company to buyback $15.00 billion in outstanding shares on Wednesday, February 13th. This buyback authorization permits the network equipment provider to purchase up to 6.5% of its shares through open market purchases. Shares buyback programs are generally a sign that the company’s board of directors believes its shares are undervalued.

CSCO has been the topic of several analyst reports. Citigroup boosted their target price on Cisco Systems from $52.00 to $56.00 and gave the company a “buy” rating in a research report on Thursday. Credit Suisse Group boosted their target price on Cisco Systems from $44.00 to $47.00 and gave the company a “neutral” rating in a research report on Thursday. JPMorgan Chase & Co. reissued a “buy” rating on shares of Cisco Systems in a research report on Thursday, November 15th. KeyCorp boosted their target price on Cisco Systems from $52.00 to $53.00 and gave the company an “overweight” rating in a research report on Thursday, November 15th. Finally, Loop Capital raised Cisco Systems from a “hold” rating to a “positive” rating and set a $45.00 target price on the stock in a research report on Thursday, November 15th. They noted that the move was a valuation call. Seven analysts have rated the stock with a hold rating, twenty have issued a buy rating and one has issued a strong buy rating to the company. The stock presently has a consensus rating of “Buy” and an average price target of $53.22.

Get Cisco Systems alerts:

Shares of Cisco Systems stock opened at $49.43 on Friday. The firm has a market capitalization of $228.83 billion, a price-to-earnings ratio of 21.12, a price-to-earnings-growth ratio of 2.78 and a beta of 1.16. The company has a debt-to-equity ratio of 0.42, a quick ratio of 2.05 and a current ratio of 2.11. Cisco Systems has a 52 week low of $40.19 and a 52 week high of $49.68.

Cisco Systems (NASDAQ:CSCO) last announced its quarterly earnings data on Wednesday, February 13th. The network equipment provider reported $0.73 EPS for the quarter, beating the Thomson Reuters’ consensus estimate of $0.72 by $0.01. The company had revenue of $12.45 billion for the quarter, compared to the consensus estimate of $12.43 billion. Cisco Systems had a return on equity of 26.99% and a net margin of 25.31%. Cisco Systems’s quarterly revenue was up 4.7% on a year-over-year basis. During the same quarter in the prior year, the company posted $0.63 EPS. On average, equities analysts expect that Cisco Systems will post 2.7 EPS for the current fiscal year.

The firm also recently disclosed a quarterly dividend, which will be paid on Wednesday, April 24th. Shareholders of record on Friday, April 5th will be given a $0.35 dividend. This represents a $1.40 annualized dividend and a yield of 2.83%. The ex-dividend date of this dividend is Thursday, April 4th. This is an increase from Cisco Systems’s previous quarterly dividend of $0.33. Cisco Systems’s dividend payout ratio is 56.41%.

In other news, Director M Michele Burns sold 4,744 shares of the stock in a transaction on Wednesday, December 19th. The stock was sold at an average price of $44.06, for a total transaction of $209,020.64. Following the transaction, the director now owns 74,164 shares of the company’s stock, valued at approximately $3,267,665.84. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, CFO Kelly A. Kramer sold 70,000 shares of the stock in a transaction on Thursday, November 29th. The stock was sold at an average price of $47.44, for a total value of $3,320,800.00. Following the transaction, the chief financial officer now directly owns 492,301 shares in the company, valued at approximately $23,354,759.44. The disclosure for this sale can be found here. Insiders sold a total of 166,067 shares of company stock worth $7,804,662 in the last ninety days. 0.03% of the stock is currently owned by corporate insiders.

ILLEGAL ACTIVITY NOTICE: This piece was originally posted by Ticker Report and is owned by of Ticker Report. If you are reading this piece on another publication, it was copied illegally and republished in violation of US & international copyright and trademark laws. The legal version of this piece can be read at https://www.tickerreport.com/banking-finance/4155595/stock-buyback-program-approved-by-cisco-systems-csco-board.html.

Cisco Systems Company Profile

Cisco Systems, Inc designs, manufactures, and sells Internet Protocol based networking and other products related to the communications and information technology industry worldwide. The company offers switching products; routing products that interconnect public and private wireline and mobile networks; data center products; and wireless access points for use in voice, video, and data applications.

Further Reading: Does the Step Transaction Doctrine Affect a Backdoor Roth IRA?

Varonis Systems (VRNS) Stock Rating Reaffirmed by Jefferies Financial Group

Jefferies Financial Group reiterated their buy rating on shares of Varonis Systems (NASDAQ:VRNS) in a report published on Tuesday, MarketBeat.com reports. Jefferies Financial Group currently has a $73.00 price objective on the technology company’s stock, down from their prior price objective of $81.00. Jefferies Financial Group also issued estimates for Varonis Systems’ Q1 2019 earnings at ($0.63) EPS, Q2 2019 earnings at ($0.27) EPS, Q4 2019 earnings at $0.05 EPS, FY2019 earnings at ($0.99) EPS, Q1 2020 earnings at ($0.51) EPS, Q2 2020 earnings at ($0.22) EPS, Q3 2020 earnings at ($0.18) EPS, Q4 2020 earnings at ($0.01) EPS and FY2020 earnings at ($0.88) EPS.

A number of other analysts have also recently issued reports on the company. Robert W. Baird reissued a buy rating and set a $60.00 target price (down from $75.00) on shares of Varonis Systems in a research note on Tuesday. BidaskClub raised Varonis Systems from a hold rating to a buy rating in a research note on Thursday, January 31st. Craig Hallum raised Varonis Systems from a hold rating to a buy rating in a research note on Tuesday, January 29th. Morgan Stanley lowered their target price on Varonis Systems from $70.00 to $68.00 and set an equal weight rating for the company in a research note on Tuesday, October 30th. Finally, Wedbush reissued a hold rating and set a $68.00 target price on shares of Varonis Systems in a research note on Tuesday, October 30th. Eight analysts have rated the stock with a hold rating and twelve have assigned a buy rating to the company’s stock. The stock has an average rating of Buy and a consensus target price of $67.48.

Get Varonis Systems alerts:

Shares of NASDAQ:VRNS opened at $54.45 on Tuesday. The company has a market capitalization of $1.63 billion, a P/E ratio of -55.56 and a beta of 0.99. Varonis Systems has a fifty-two week low of $48.67 and a fifty-two week high of $83.10.

Varonis Systems (NASDAQ:VRNS) last announced its quarterly earnings results on Monday, February 11th. The technology company reported $0.20 earnings per share for the quarter, beating analysts’ consensus estimates of $0.09 by $0.11. The business had revenue of $87.52 million for the quarter, compared to the consensus estimate of $87.33 million. Varonis Systems had a negative net margin of 10.57% and a negative return on equity of 24.02%. Research analysts predict that Varonis Systems will post -0.93 earnings per share for the current fiscal year.

In other news, CEO Yakov Faitelson sold 30,000 shares of the firm’s stock in a transaction that occurred on Thursday, February 14th. The shares were sold at an average price of $54.72, for a total transaction of $1,641,600.00. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this link. 4.20% of the stock is owned by company insiders.

Several institutional investors and hedge funds have recently modified their holdings of the company. Coe Capital Management LLC grew its stake in shares of Varonis Systems by 3.2% during the 3rd quarter. Coe Capital Management LLC now owns 21,405 shares of the technology company’s stock worth $1,568,000 after acquiring an additional 660 shares in the last quarter. Teachers Advisors LLC grew its stake in shares of Varonis Systems by 1.6% during the 3rd quarter. Teachers Advisors LLC now owns 53,837 shares of the technology company’s stock worth $3,944,000 after acquiring an additional 863 shares in the last quarter. United Services Automobile Association grew its stake in shares of Varonis Systems by 27.0% during the 3rd quarter. United Services Automobile Association now owns 4,243 shares of the technology company’s stock worth $311,000 after acquiring an additional 902 shares in the last quarter. Strs Ohio grew its stake in shares of Varonis Systems by 6.3% during the 4th quarter. Strs Ohio now owns 16,900 shares of the technology company’s stock worth $894,000 after acquiring an additional 1,000 shares in the last quarter. Finally, Swiss National Bank grew its stake in shares of Varonis Systems by 2.2% during the 3rd quarter. Swiss National Bank now owns 50,118 shares of the technology company’s stock worth $3,671,000 after acquiring an additional 1,100 shares in the last quarter. 83.75% of the stock is owned by institutional investors.

Varonis Systems Company Profile

Varonis Systems, Inc provides software solutions that protect data from insider threats and cyberattacks. The company, through its software, allows organizations to protect data stored on premises and on cloud, such as sensitive files and emails; confidential customer, patient and employee data; financial records; strategic and product plans; and other intellectual property.

Featured Story: How Does the Quiet Period Work?