9.27 -0.01 (-0.11%)
After hours: 7:47PM EDT
|Bid||9.30 x 45100|
|Ask||9.30 x 38500|
|Day's Range||9.18 - 9.31|
|52 Week Range||7.41 - 10.56|
|Beta (3Y Monthly)||0.97|
|PE Ratio (TTM)||17.19|
|Earnings Date||Oct 23, 2019|
|Forward Dividend & Yield||0.60 (6.45%)|
|1y Target Est||10.73|
Apple-backed DiDi Chuxing has received a license to operate a fleet of self-driving cars on a pilot basis in part of the Jiading district in Shanghai.
InvestorPlace columnist Mark Hake recently argued that Ford (NYSE:F) might not be able to afford to pay its 15-cent quarterly dividend on Ford stock. Source: r.classen / Shutterstock.com InvestorPlace - Stock Market News, Stock Advice & Trading TipsAs part of Hake's argument, he pointed to the suspension of the special dividend as an indication that Ford's free cash flow isn't keeping up with its financial commitments to shareholders. Given the slowdown of the company's free cash flow, Hake is right to argue that Ford stock is not necessarily the dividend star its current 6.4% yield would imply. However, I believe that the problem isn't the special dividend, but rather the regular dividend. Here's why. Adjusted Free Cash FlowAs Hake's article stated, Ford's adjusted free cash flow in the first six months of fiscal 2019, was $2.1 billion, 80% higher than a year earlier. Of that $2.1 billion, $1.2 billion went to the company's quarterly dividend. If Ford had continued to pay its annual special dividend, it would have had to shell out approximately $600 million for it, the same amount it paid last year. From this perspective, my belief that Ford shouldn't have cut its 13-cent special dividend seems off the mark. That's especially true because Ford's free cash flow is expected to drop dramatically for the rest of 2019 and into fiscal 2020. That's because it continues to implement its Global Redesign to meet the future demand for electric vehicles. According to Hake, because of the Global Redesign, the company won't have enough adjusted free cash flow to afford other pressing obligations, including its pension contributions and its debt repayments.If you own Ford stock, I recommend that you read Hake's entire article. It does a very good job explaining why Ford's dividend yield is a double-edged sword. The Special Dividend Leaves Ford With OptionsThe problem with regular dividends is that they become addictive. Companies brag about how many years they've increased their annual dividend.For companies that have increased their dividends for many years in a row, it becomes increasingly difficult to cut or suspend the dividend. If shareholders are disappointed by the reduction of a dividend, many of them will probably sell their shares. While the special dividend is intended to be a perk that rewards shareholders when there is excess cash, I believe Ford should use it in place of permanent dividends. It would be up to the company to decide whether to pay out up to 50% of its free cash flow on an annual basis through one or more special dividends. The argument against this kind of arrangement is that shareholders pile in to capture the dividend payment and then pile out after it's been paid. However, if the board were under no obligation to pay the special dividend, it could instead decide to use the money for other purposes, including repurchases of Ford stock, debt repayments, etc. As a result, it would be much tougher for investors to know when or if Ford would pay a special dividend. Ford stock has traded under $10 for the better part of the last year. If it's really worth more than $10 per share, the company ought to be buying back F stock, not paying out quarterly dividends. The Bottom Line on Ford StockOver the past year, while Ford stock has soured, I've become more of a fan. In July, I argued that the chances were good that F stock could get to $20 within four years. A couple of months later, nothing has changed to make me think otherwise. However, as long as the company is obligated to pay out almost $5 billion per year of dividends, its free cash flow generation is being unnecessarily pressured. Forget the dividend. Ford needs to switch to something special. At the time of this writing Will Ashworth did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Momentum Stocks to Buy On the Dip * 7 Dow Titans Breaking Higher * 5 Growth Stocks to Sell as Rates Move Higher The post Why Ford Shouldn't Cut Its Special DividendÂ on Ford Stock appeared first on InvestorPlace.
The Trump administration will announce as early as Wednesday it is revoking California’s authority to set its own greenhouse gas and vehicle fuel efficiency standards and barring all states from setting such rules, two auto industry officials said on Tuesday. The move is sure to spark legal challenges over issues including states' rights and climate change that administration officials say could ultimately be decided by the U.S. Supreme Court. Trump met with senior officials last Thursday and agreed to greenlight the plan to bar California from setting tailpipe emission standards or requiring zero emission vehicles, Reuters reported last week.
There's not a stock in the market with a more pitched bull and bear divide than Tesla (NASDAQ:TSLA) stock. Bulls cite a massive growth opportunity -- and a company that can help improve life on Earth. Bears point to the company's lack of profitability, a long list of broken promises and an arguably inflated valuation.Source: Hadrian / Shutterstock.com I've long leaned toward the bearish side of the argument (and taken bearish option positions in the stock, though I'm currently on the sidelines) for one simple reason: I don't trust its management. That concern isn't really based on the arguments over the infamous "funding secured" tweet and the still-lengthening list of broken promises.Rather, it comes down to the fact that auto manufacturing is a notoriously difficult and capital-intensive business. As both TSLA bulls and bears will point out (for very different reasons), among U.S. manufacturers, only Tesla and Ford (NYSE:F) have never gone bankrupt.InvestorPlace - Stock Market News, Stock Advice & Trading TipsYet Tesla, drama aside, has hardly executed well -- or, in my opinion, been managed well. The company announced in late February it was closing all its stores, then reversed field two weeks later. Prices constantly move around. The decision to avoid model years has created issues in parts and services. This is too difficult an industry to not have detailed strategies and top-notch execution.TSLA bulls for the most part have been forgiving, and chosen to put their faith in CEO Elon Musk. At this point, I wonder whether it's still possible to ignore his critics. Do You Believe in Robo-Taxis?At Tesla's Autonomy Day in April, Musk said the company was on its way to fully autonomous driving. He announced that the company would have 1 million "robo-taxis" on the road by the end of 2020.Musk doubled down on that claim on an investor call a little over a week later. He told listeners that in three years existing Tesla models would be worth $150,000-$250,000. In July, that figure came down a bit, but on Twitter Musk still put the value at $100,000-$200,000. * 7 Momentum Stocks to Buy On the Dip So a key question for anyone considering Tesla stock is this: Do you believe those claims?Few do. TSLA stock actually declined 4% in trading on the day of the Autonomy Day (though, to be fair, it regained those losses the following session). Noted TSLA bull Gene Munster of Loup Ventures said in the context of Apple (NASDAQ:AAPL) that "autonomy is going to take longer than people think." Most auto executives believe it will be at least a decade. Autonomy leader Waymo, a unit of Alphabet (NASDAQ:GOOG,NASDAQ:GOOGL), believes it's even further away.In fact, it certainly doesn't seem like Tesla itself believes its CEO. After all, the company is cutting the price of both the Model 3 and the Model Y. Why, exactly, is Tesla selling "appreciating assets," as Musk termed them, for 40% of the company's low estimate of their value? Tesla closed the second quarter with $5 billion in cash. Surely, it could lower deliveries and either sell the cars at a bigger profit or keep them for an in-house fleet.After all, Tesla is guiding for total production of 10,000 units a week by the end of the year. 500,000 units annually at $100,000 each would be worth $50 billion. That's roughly equivalent to Tesla's current enterprise value. What Does That Mean for TSLA Stock?The dubiousness of Musk's claims in turn leads to another question: Can an investor buy Tesla stock if he or she doesn't believe the CEO?Obviously, many investors believe the answer is "yes." Tesla has a large retail shareholder base. Institutions -- and Wall Street analysts -- in many cases have stuck behind the company, and behind TSLA stock.And maybe the opportunity is such that the stock is worth the risk. After all, an investor could plausibly argue that even if Musk is exaggerating, TSLA stock still has upside. If the robo-taxis are worth $50,000 and won't arrive for a few years, that still suggests potentially higher prices down the line.That might be true. But remember: This is a brutally difficult industry. It requires huge amounts of capital (as Tesla has learned). It requires execution and strategy that are on point.And Musk is making what appears to be a ridiculously optimistic claim about something that is a big part of the Tesla business model -- and the bull case for Tesla stock. This isn't random musing about life on Mars. The 1 million robo-taxis by next year claim was made at an event specifically designed to highlight the company's plans in autonomy. It wasn't an off-hand remark made on an earnings call or at a conference.From here, if an investor can't believe that goal, that investor can't, and shouldn't, own Tesla stock. For now, many investors see it differently. That may not be the case forever.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Momentum Stocks to Buy On the Dip * 7 Dow Titans Breaking Higher * 5 Growth Stocks to Sell as Rates Move Higher The post Can Tesla Stock Investors Trust Elon Musk? appeared first on InvestorPlace.
Ford Motor Company will release its third quarter U.S. sales results at approximately 9:15 a.m. ET Wednesday, October 2, 2019. At 10:00 a.m. ET, Mark LaNeve, Ford vice president, U.S.
The new trading week didn't get started on a particularly impressive foot. Even with the intraday recovery effort, the S&P 500 still ended the day lower by 0.31%. Surging oil prices, thanks to an attack in the Middle East, sparked concern of a ripple effect.Source: Shutterstock Overstock.com (NASDAQ:OSTK) was the proverbial problem child, falling more than 20% to log a second day of losses following last week's big runup. Ford (NYSE:F) fell a more nominal 1.6%, with investors digesting the response to a recent UAW threat to go on strike, in addition to news that the company is recalling more than 300,000 Explorers due to dangerous seat edges. * 10 Recession-Resistant Services Stocks to Buy Headed into today's trading action, it's the stock charts of Southwest Airlines (NYSE:LUV), Visa (NYSE:V) and Coca-Cola (NYSE:KO) that have earned a closer inspection. Here's why, and what to look for.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Coca-Cola (KO)It has been one of the healthier trades this year, despite the drinking public's growing aversion to sugary beverages. In fact, Coca-Cola shares have rallied an amazing 20% since March's low, overcoming its February stumble with relative ease.The sheer speed and span of the move in an environment that doesn't favor most of the company's fare, however, has left KO stock vulnerable to some profit-taking. One more technical misstep could push Coca-Cola shares over that edge. * Click to EnlargeThe "edge" in question is the straight-line support that connects the bulk of the lows seen since March's pivot. It's plotted as a dashed blue line on both stock charts. * KO shares are no stranger to big swings. In fact, they make them on a rather reliable basis. All of the recent cases where the weekly chart's RSI line entered overbought territory led to major setbacks. * Although up for the past couple of months, take note of the fact that there's been more bearish volume than bullish volume. * The purple 50-day moving average line may also be a make-or-break support level at this time. It has been in the past. Southwest Airlines (LUV)Airline stocks are inherently erratic, impacted not just by the ebb and flow of demand for travel, but by the ebb and flow of oil prices. The two differing factors don't always behave with respect to one another as one might expect. Southwest Airlines has been no exception to this norm.There has been a method to the madness though. LUV stock has hammered out the formation of a familiar and telling shape. And, it has done so with a fairly predictable context that implies a breakout thrust could be brewing. * 7 Momentum Stocks to Buy On the Dip * Click to EnlargeThe bigger-picture pattern is a converging wedge shape, marked in blue lines on both stock charts. The lower edge of the wedge patterns, as can only be seen on the weekly chart, extends all the way back to 2015. * There's also something important but easy to overlook in the moving average lines plotted on both stock charts. They're all essentially converged now, setting the stage for a divergence from this point forward. * Tilting the scales in a bullish direction is the high-volume gains that started to materialize last week, and the subsequent push above a not entirely perfect upper boundary of the wedge shape. Visa (V)Finally, Visa has dished out some unexpectedly lengthy and sizable rallies since the beginning of 2017. In fact, the only real rough patch was the weakness most other stocks suffered in the final quarter of last year. And even then, V stock snapped back to an even stronger rally.As could be expected though, the weight of that eight-month gain is starting to prove unbearable. Visa shares have been hit hard a couple of times since last month, and while the advance hasn't been shattered yet, it's nearing that point. * Click to EnlargeThe weekly chart puts things in perspective. Last week's high had V shares more than 17% above the 200-day moving average line marked in white on both stock charts. That's the biggest divergence in years. * The line in the sand, so to speak, is the 100-day moving average line marked in gray. * Possible landing points include the $156.70 area marked in yellow on the daily chart, where V shares found support a couple of times in May, and then the 38.2% Fibonacci retracement line at $162.16, marked on the weekly chart.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about him at his website jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Momentum Stocks to Buy On the Dip * 7 Dow Titans Breaking Higher * 5 Growth Stocks to Sell as Rates Move Higher The post 3 Big Stock Charts for Tuesday: Southwest Airlines, Visa and Coca-Cola appeared first on InvestorPlace.
India's goods and services tax (GST) panel is unlikely to approve lowering the tax for the auto and allied components sector this week, as a study has warned of major revenue losses, two government officials said. A government study, attached to the agenda of a Sept. 20 GST panel meeting, has said the total annual revenue loss could be as much as 500 billion rupees ($6.95 billion), if the panel decided to lower tax rates for the auto sector to 18% from 28%. Meanwhile, state officials in Kerala, Punjab and West Bengal say they are also opposed to any cut in tax rates in the autos sector, or even consumer goods, because of lacklustre tax collections this fiscal year.
Ford's (NYSE:F) senior unsecured rating might have been downgraded to junk status by Moody's, but Ford stock has still not been downgraded. The impact of the junk status rating on F stock was limited and indicates that investors are not worried about any credit stress.Source: Philip Lange / Shutterstock.com It is worth noting that F stock price is exactly at the same level as it was a year before. Clearly, the markets are waiting for the next trigger, but market participants have not given up on Ford.I am in agreement with the markets and I believe that Ford can still survive and grow. This coverage will discuss the factors that can be potential positive catalysts.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Ford is Battling To SurviveWeak sales in the traditional car segment have already been discounted in F stock price. The markets are now focused on how the company's electric vehicle plans shape-up. * 10 Stocks to Sell in Market-Cursed September Ford is betting big on the EV segment, which can potentially transform the organization and the growth outlook. To put things into perspective, Ford plans to launch a series of electric vehicles in the next 2-3 years. By 2022, the company expects 50% of sales to come from electric vehicles.It is true that the EV segment already has significant competition. However, Allied Market Research expects the EV market to grow at a CAGR of 22.3% between 2018 and 2025. Therefore, the market has enough potential to absorb new entrants.It is also worth noting that China has a market share of 57% in the EV segment. Ford has big plans for China with 10 new EVs to be launched within the next three years. This can help Ford accelerate revenue growth.While Ford will launch several models, I believe that consumers will be looking forward to the Mustang Electric Performance SUV that will arrive in 2020. Further, with the crossover segment gaining popularity, the Puma EcoBoost Hybrid will also be eagerly awaited.The bottom line is that Ford is changing in sync with industry trends and will keep the markets excited with several new launches.It remains to be seen if this translates into top-line growth. However, the EV segment is growing fast and it is very likely that the de-growth trend will reverse. Ford has Ample Liquidity HeadroomI am also of the opinion that Ford has ample liquidity for restructuring and growth investments. In June 2019, the company reported $22 billion in cash and $16 billion in marketable securities, bringing the total liquidity buffer to $38 billion.While Ford stock does have automotive segment debt of $13.9 billion, I don't see servicing as a concern. The annualized interest expense on automotive debt is likely to be in the range of $900 million to $1 billion.With adjusted EBIT of $1.7 billion for the second quarter of 2019, the annualized adjusted EBIT is likely to be $6.8 billion. Therefore, the EBIT interest coverage is likely to be in the range of 6.0 to 7.0. Clearly, there is no debt servicing concern.In addition, the company's adjusted free cash flow for the last 12 months was $3.7 billion. This provides additional liquidity cushion. However, I believe that Ford needs to reduce dividends. This will allow the company to save cash for growth initiatives planned for the next few years. Final Words on Ford StockFord does have concerns as evidence in its sales decline. In addition, weak global macro-economic conditions add to the challenge. However, it is too early to write-off Ford stock.Be it the electric vehicle segment or advances in development of autonomous vehicles, Ford has been changing to cater to the current demand. * 7 Tech Stocks You Should Avoid Now F stock has also been sideways for a year and indicates that the markets are waiting for the next trigger. I do believe that it's likely to be positive with a series of new model launches in 2020 and beyond. This can possibly take F stock price higher after the current consolidation.Even from a credit perspective, Ford is not on the brink of a major balance sheet stress. However, I do believe that reducing dividends and conserving cash would be a good strategy.Overall, Ford stock is worth accumulating at current levels with a two-to-three year investment horizon. Of course, a quarterly review of the investment decision is necessary after analysis on revenue impact of new model launches.As of this writing, Faisal Humayun did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Recession-Resistant Services Stocks to Buy * 7 Hot Penny Stocks to Consider Now * 7 Tech Stocks You Should Avoid Now The post Despite Junk Credit, Ford Stock Still Hasn't Been Downgraded by the Markets appeared first on InvestorPlace.
Andrew Wheeler, the head of the Environmental Protection Agency, said on Tuesday that the US government would move to prevent California from enacting tougher standards than President Donald Trump plans to impose on a national level. Barack Obama granted California a special licence to set it own emissions rules in 2013. After the Trump administration said last year it intended to roll back the former president’s national standards, the state said it would continue to apply them anyway.
General Motors was hit with its first strike since 2007 — which could cost the largest U.S. carmaker $10s of millions per day, analysts said.
GM strike 2019 news is spreading following a walk out of 50,000 United Auto Workers (UAW) members on Sunday night.Source: Katherine Welles / Shutterstock.com The strike against General Motors (NYSE:GM) comes as it negotiates with workers that are part of the UAW union. These members are negotiating for higher pay, better benefits and more job security.The GM strike 2019 is the result of the two groups not being able to come to terms on a deal. GM says that it is offering higher pay and better profit sharing. However, it appears that the UAW wasn't happy with the offer.InvestorPlace - Stock Market News, Stock Advice & Trading TipsThe GM strike 2019 is the largest that has happened since 2007 when UAW members spoke out against pay and benefits then too. GM and UAW are meeting again today, but it's unknown if they will reach an agreement this time around, reports CNNBusiness."The fight more is for the future. The middle class has been eroding. We've been losing, losing. We've been making concessions for the past three contracts…" Celso Duque, a GM employee, told Fox Business. "The main issue isn't that they're building in Mexico. The issue is that they're building in Mexico and then shipping the cars up here to sell." * 7 Tech Stocks You Should Avoid Now It's worth noting that the GM strike 2019 is important for more than just GM. UAW members also work at Ford (NYSE:F) and Fiat Chrysler (NYSE:FCAU). Whatever happens here could affect negotiations with those two companies further down the line.GM stock was down 4% as of noon Monday. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Recession-Resistant Services Stocks to Buy * 7 Hot Penny Stocks to Consider Now * 7 Tech Stocks You Should Avoid Now As of this writing, William White did not hold a position in any of the aforementioned securities.The post GM Strike 2019: 50,000 Auto Workers Walk Out appeared first on InvestorPlace.
General Motors is focusing on profitable SUVs now and self-driving cars for the future. But a new GM strike adds to challenges. Is GM stock a buy now? Take a look under the hood.
Management will soon have the opportunity to give Nio (NYSE:NIO) stock the push it needs to trigger a continuation rally so it can dig itself out of this hole, but it won't be easy.Source: xiaorui / Shutterstock.com Thanks to companies like Tesla (NASDAQ:TSLA) and NIO, e-cars are gaining momentum on the internal combustion engine. For decades the idea was silly, and for some reason manufacturers made their electric cars look odd. * 7 Tech Stocks You Should Avoid Now Now the cars are gorgeous. As a result, the electric car market is growing rapidly and gaining serious momentum. Even the major global auto manufacturers are joining the e-car movement. Most notably Porsche with its Taycan debut.InvestorPlace - Stock Market News, Stock Advice & Trading TipsNIO operates in China, which is a huge market for electric vehicles. While it is growing its business, however, its stock has gone the wrong way. Sporadically, NIO stock rallied fiercely especially after a TV special that propelled the stock to almost $11 per share, only to fail miserably mere hours later. Now, six months later, the NIO stock price is 70% lower and mired just above its all-time lows.From here, it is best to only trade Nio stock. Otherwise, one has to own it for the really long-term hopium of a comeback. For that there are two necessary assumptions. The first is that electric cars in general will succeed in becoming mainstream. This will probably require the help of legislation on the global level and there are signs that this is possible. The second assumption is that NIO stock will succeed in its own mission inside the overall market success.For shorter-term, there are clues for trading the stock from the charts. In my last write-up, I noted that the NIO stock was broken but the company still had a chance. While this is true, it is little consolation for those stuck in the stock from higher levels. But if someone hung on this long there is more upside potential than downside risk, so it's probably too late to exit now.There is an earnings report coming soon which adds another temporary layer of risk as recent reactions to those have been negative on Wall Street. NIO Stock Headed Into Wild Action SoonSour investment sentiment alone is not an indication of doomsday forecast for the company. Case in point: TSLA stock is also miles away from its highs and so far the company is still executing on its expansion plans. So NIO stock woes are not necessarily a sign of a dying company. But it is important that management delivers some good operational news so that investors don't capitulate out of the stock in a week when they report earnings.Meanwhile, September has been good for NIO stock as it bounced hard off of the $2.60 per share low. This also marks the point of control for the period, meaning that this is where buyers and sellers fought the hardest, so it is supported until proven otherwise.Unfortunately the NIO stock price is now headed into resistance because of a price cluster near $3.50 per share. If I'm not yet long the stock, I would wait until the bulls are able to push prices above that before chasing it. This is also a place to book some profits for those long off the $2.50 base.Depending on what happens today with the news from Saudi Arabia and how it affects oil and electric car stock prices, there could be technical opportunity in NIO stock. If the bulls are able to establish the $3.20 as a base, they could extend this rally to retest $4 which was a recent failure point from early July. Otherwise, I expect another dip to establish a better base closer to $3 per share. Nio Stock Bottom LineThis is just part of normal price action in any stock and says nothing about NIO itself. So the best way to trade its stock here is to trade off these lines that matter on the lower time frames. The idea is to wait for the breeches as they happen and chase them in that direction.The alternative would be for investors to buy NIO on a leap of faith into the next earnings report hoping that the company gives Wall Street reasons to celebrate with a rally. Otherwise there's no guarantee that the recent lows will hold. Having a low $2.50 stock price doesn't mean it is cheap because it can go lower. Especially if management fails again in its quarterly goals. Click to EnlargeIt is important to not get emotional about an investment. For some reason, electric car stocks draw a lot of emotions on Wall Street. Using the charts helps separating feelings from strategy. There is great information in charts as price action always unfolds to historical patterns regardless of headlines. As they say, "price is truth," and in the end that's the only thing that matters here.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room for free here. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Recession-Resistant Services Stocks to Buy * 7 Hot Penny Stocks to Consider Now * 7 Tech Stocks You Should Avoid Now The post NIO Stock Headed Into Wild Action Soon appeared first on InvestorPlace.
General Motors' (GM) troubles seem to be increasing. The UAW (United Automobile Workers) called for a strike, which would impact thousands of workers.
In the electric pickup truck market, legacy automakers Ford and GM are set to take on established electric vehicle maker Tesla and startups such as Rivian.
Stock futures fell and crude oil prices leapt as a drone attack halved Saudi output. UAW began a GM strike. Apple iPhone preorders "look good" with Apple stock near a buy.
Jim Ratcliffe, one of Britain’s richest men, is close to signing a deal to build a sport utility vehicle in the Welsh town where Ford is closing its factory, potentially offering a lifeline to hundreds of workers and injecting new energy into the UK automotive sector. A deal between Ineos and the Welsh government over a site in Bridgend is set to be announced this week, according to three people familiar with the plans.
GM shares trade lower Monday after nearly 50,000 members of the United Auto Workers Union goes on strike in a move that could shut down production at the biggest U.S. carmaker for several days.
Benzinga has examined the prospects for many investor favorite stocks over the past week. Bullish calls included the iPhone maker, a Big 3 automaker and a restructured industrial company. Bearish calls ...
After strong market gains through the summer, August was a volatile month for the stocks. The S&P 500 fell 5.6% in the first week, then bounced around for three weeks before charging into September with another 5.6% shift – a surge back up to its current 3,007.The stock market turnaround is just one of several positive economic indicators so far this month. The August jobs report, while showing low job creation numbers, also showed increasing wages, and last week, Labor Department numbers showed that there are 1.17 million more jobs than openings in the US. It’s a bright picture. But not every stock is on its way back up. Some are struggling to gain traction.Finding the right stock in this environment can be a challenge. That’s why TipRanks provides a variety of stock screening tools, offering you the ability to sort through the market for the right investment.We’ve opened up TipRanks’ Trending Stocks tool to find three stocks that are underperforming right now, but are also showing high upside potential in the face of idiosyncratic headwinds. These are investment opportunities that have attracted attention from top analysts, and have the seeds for future market gains. Domino’s Pizza, Inc.With the rise of third-party delivery companies, such as GrubHub (GRUB – Get Report), the fast food space generally is coming to resemble the pizza delivery niche. With a phone call or an online order, the customer’s meal is only half an hour away. Michigan-based Domino’s Pizza (DPZ – Get Report), which built its customer base in the 1990s on a promise of fast delivery, has been feeling the pressure as fast food delivery diversifies. DPZ shares are down 1% so far this year, despite a general S&P gain of 19%.This doesn’t mean that Domino’s feels itself vulnerable. Back in July, the company beat the earnings forecast in Q2, reporting $2.19 per share against a predicted $2 even. And it did that despite missing the revenue forecast by 2.5%, or $22 million. Even with the revenue miss, DPZ reported strong resources: cash on hand was up, at $108.3 million, while long-term debt was down 2.2%.BTIG analyst Peter Saleh is impressed by DPZ’s use of resources to create innovations in the delivery space. The company is not entering into third-party agreements, but is keeping delivery in-house. Earlier this month, Saleh attended DPZ’s Innovation Garage event, and saw how Domino’s is investing in autonomous vehicle delivery and GPS tracking. He writes, “while Domino's Pizza is facing competitive headwinds from delivery aggregators, it is starting to fight back with promotions and measures to improve efficiency.” Saleh gives DPS a $325 price target, suggesting an impressive 32% upside potential.From Oppenheimer, Brian Bittner gives DPZ shares a $295 price target and 20% upside. He sees Domino’s as “well-prepared for the delivery challengers and ready to go it alone.” In his comments, he adds, “Management believes it ultimately has technological, economic and service superiority over [competing] vendors which will be a benefit over the cycle. Nearer term, the company does not plan to react by deep-discounting or discounted/free delivery.”Overall, DPZ has a 16% upside potential, derived from its $285 average price target and $245 current share price. The stock has a Moderate Buy rating from the analyst consensus, based on 14 buys, 7 holds, and 1 sell. Ford Motor CompanyThe second largest domestic automaker, Ford (F – Get Report) possesses a combination of resources and liabilities. On the negative side of the ledger, Moody’s credit rating agency has just lowered the company’s rating below investment grade. Moody’s cited Ford’s “operating and marketing challenges” as reasons for the downgrade, and added that the company is at the start of a long restructuring effort in a bearish industry.Ford, for its part, does not seem worried by the credit downgrade. S&P and Fitch still rate the company as investment grade, and the restructuring noted by Moody’s includes an $11 billion investment in electric and hybrid vehicles. The capital investment includes new spending on factories as well as vehicle design and autonomous driving systems.Still, a downgrade from a credit rating agency looks bad in the headlines. Ford shares lost 1.3% by mid-week. The stock has been highly volatile this year, swinging between a low of $7.44 and a high point of $10.36.Two analysts weighed in with buy ratings on the stock. Credit Suisse’s Dan Levy noted that Ford has $23 billion in cash on hand, giving it plenty of resources to fund its global restructuring effort. He writes, “For now, Moody’s downgrade doesn’t change the Ford story. We think the core focus at Ford remains the path to profit recovery, which we continue to believe remains intact.” Levy’s $12 price target implies an upside of 26% for Ford.Analyst John Murphy, of Merrill Lynch, agrees that Ford has upbeat prospects. He says, “We believe Ford’s self-help turnaround should start to get more credit among investors, while improved execution and communication may also allow Ford’s multiple to recover, although the downgrade news was somewhat disappointing.” Countering the disappointment, he notes that Ford remains committed to maintaining its shareholder dividend, with an impressive 6.35% yield, and that the primary source of bad news – slowing car sales in the European and Asian markets – has already been baked into the share price. He puts a $13 price target on F shares, indicating an upside potential of 37%.Ford holds a Moderate Buy from the analyst consensus, based on 4 buys and 3 holds from the last three months. Shares sell for $9.45, and the average price target of $11.58 suggests an upside of 22%. Netflix, Inc.The early adopter in the online TV content streaming space, Netflix (NFLX – Get Report) has the advantage of incumbency against the much-hyped competition from Disney (DIS – Get Report) and Apple (AAPL – Get Report) which will be starting this fall.Netflix’s main advantage, of course, is its library of 400+ original programs to run on the streaming service. This will be less of an advantage against Disney, which brings its own famous Disney Vault to the party, but Netflix having proven winners like Stranger Things and talent like Samuel L. Jackson and Oprah Winfrey on board is a clear sign of strength in the content creation market.Disappointing subscriber numbers from the second quarter, however, depressed Netflix’s share price, and the company's year-to-date gain is only 9%. Netflix lost 15% after reporting net subscription adds of only 2.7 million, against the forecast 5 million. Even worse, the company’s core US market saw a decline of 100,000 subscribers instead of the expected 300,000. And to keep the hits coming, Apple announced last week that its Apple TV streaming service, to be priced at just $4.99 per month, will be significantly less expensive than the $8.99 Netflix charges for its most basic service.The analysts, however, seem to agree that the fears for Netflix are overblown, and that the company’s resources are sufficient to meet the challenges. 5-star analyst Michael Olson, of Piper Jaffray, writes: “Preliminary search index analysis suggests Q3 domestic subscriber growth of 6.4% year-over-year, and international growth in the range of 33%-35%. Further, the number of U.S. YouTube trailer views for major Netflix originals is up 10% quarter-over-quarter from Q2, signaling a more engaging content slate. Expect Netflix to continue to capture a significant portion of traditional content dollars despite an onslaught of new streaming services currently casting a cloud of concern.” Olson sets a $440 price target on NFLX, indicating confidence in a 49% upside.Imperial Capital analyst David Miller agrees, believing that “the market is too focused on price points rather than the value for that said price point.” His $451 price target implies an even more robust 53% upside for the streaming giant.Overall, Netflix maintains a Strong Buy from the analyst consensus, based on a whopping 25 buy ratings set in the last three months, along with only 5 holds and 1 sell. Shares are expensive, at $295, and the average price target of $411 suggests an upside potential of 39%.Visit TipRanks’ Trending Stocks page today, to see what else has the attention of Wall Street’s best analysts.
(Bloomberg) -- Michael Bennet, who didn’t make the cut for Thursday’s Democratic debate in Houston, is taking to the airwaves in Iowa with his first media buy of the campaign.The presidential candidate and Colorado senator reserved at least $32,891 in the Des Moines and Ceder Rapids markets, according to Advertising Analytics, which tracks political advertising. The ads are slated to air starting Tuesday.Bennet failed to meet either requirement set by the Democratic National Committee for making the debate stages. The 10 candidates who participated had at least 130,000 unique donors and reached 2% in four national polls. Bennet will need to reach those marks by Oct. 1 to make the cut for the next round, scheduled to begin Oct. 15 in Westerville, Ohio.Spending on ads can boost a candidate’s standing in the polls, but they’re expensive. Billionaire Tom Steyer, who qualified for the October debate after entering the race in July, has spent about $14.3 million on broadcast and cable spots. That’s four times the amount Bennet’s campaign has raised.Democrats Set Next Debate for Oct. 15 in Ohio (2:36 p.m.)The Democratic National Committee announced Friday that the fourth debate of presidential candidates will take place Oct. 15, possibly with a second night on Oct. 16, depending on how many candidates qualify.The forum at Otterbein University in Westerville, Ohio, will be co-hosted by the New York Times and CNN. Eleven candidates have already met the criteria: the 10 who participated in the third debate on Thursday, along with billionaire Tom Steyer, who only qualified recently.To qualify for the debate, candidates must receive at least 2% support in four approved polls conducted nationally or in Iowa, New Hampshire, South Carolina and Nevada. They must also raise money from a minimum of 130,000 unique donors, including 400 contributors in each of at least 20 states by Oct. 1.The October debate will be moderated by CNN’s Anderson Cooper and Erin Burnett and Marc Lacey from the Times. The format has not yet been announced. -- Ryan Teague BeckwithHarris Asks for Inquiry into Probe of Carmakers (11:44 a.m.)Senator Kamala Harris asked the Justice Department’s internal watchdog to investigate the legal underpinnings of an antitrust probe into four automakers that agreed to meet compromise tailpipe emissions targets offered by California regulators.In a letter to the department’s inspector general released Friday by her office, the California Democrat and presidential candidate said the antitrust inquiry “raises serious concerns about whether federal law enforcement is being used to coerce” the companies into abandoning efforts to produce lower-emitting vehicles. The probe also raises questions about whether the Justice Department is being used for political purposes, she wrote.At issue is a July agreement by Ford Motor Co., Honda Motor Co., BMW AG and Volkswagen AG to meet future vehicle greenhouse gas emissions targets offered by California regulators that are more stringent than under a rollback proposed by the Trump administration but easier than rules adopted by the Obama administration in effect today.Harris’ request comes after other congressional Democrats have vowed to scrutinize the probe, revealed last week. The House Judiciary committee on Monday said it planned to hold hearings and request documents from the White House and Justice Department related to the antitrust probe. -- Ryan BeeneCastro Denies Slap at Biden’s Memory Was Unfair (8:02 a.m.)Julian Castro said he has no regrets about questioning former Vice President Joe Biden’s memory during the 2020 Democratic presidential debate in Houston on Thursday -- a moment that drew boos from the crowd.“I wouldn’t do it differently,“ the former Housing and Urban Development secretary told CNN in an interview early Friday. “That was not a personal attack, this was about a disagreement over what the vice president said regarding health-care policy.“Castro, a former Obama administration colleague of Biden’s, argued during the debate that his health-care proposal was better than Biden’s because people who qualified would automatically be enrolled, rather than having to opt in to Biden’s Medicare plan.“They wouldn’t have a buy in,” Castro said during the debate.When Biden shot back, “They do not have to buy in,” Castro pounced. “Are you forgetting what you said two minutes ago?” he said. “You’re forgetting that?”Castro defended his comments in his CNN interview, saying it’s necessary to highlight the policy differences between Democratic presidential contenders. “The vice president has been around for a long time,“ he said. “When we’re up there, we’re up there to debate.“ -- Kathleen MillerCOMING UPElizabeth Warren will appear Saturday at the Massachusetts Democratic Convention in Springfield.Biden will speak Sunday at the 16th Street Baptist Church in Birmingham, Alabama, to commemorate the 56th anniversary of a bombing that killed four girls and injured 22 other people.On Monday, Biden, Bernie Sanders, Amy Klobuchar, Tulsi Gabbard, Pete Buttigieg and Bill DeBlasio will attend the Galivants Ferry Stump in South Carolina.Also on Monday, Warren will speak at a rally in New York City’s Washington Square Park.Many candidates will appear at the LGBTQ Presidential Forum in Cedar Rapids, Iowa, on Friday. Contenders who have confirmed they will attend are: Biden, Cory Booker, Buttigieg, Castro, Gabbard, Kamala Harris, Klobuchar, Joe Sestak, Warren and Marianne Williamson.\--With assistance from Kathleen Miller, Ryan Beene and Ryan Teague Beckwith.To contact the reporter on this story: Bill Allison in Washington DC at firstname.lastname@example.orgTo contact the editors responsible for this story: Wendy Benjaminson at email@example.com, Steve GeimannFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Ford Credit de México S.A. de C.V., SOFOM, ER and other ratings that are associated with the same analytical unit. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future. Credit ratings and outlook/review status cannot be changed in a portfolio review and hence are not impacted by this announcement.