76.62 -0.03 (-0.03%)
After hours: 4:46PM EDT
|Bid||76.27 x 1100|
|Ask||76.94 x 900|
|Day's Range||76.40 - 76.87|
|52 Week Range||59.92 - 82.66|
|PE Ratio (TTM)||N/A|
|YTD Daily Total Return||21.09%|
|Beta (3Y Monthly)||1.31|
|Expense Ratio (net)||0.13%|
Geopolitical tensions continue to weigh on investors as events like the September 14th attack on Saudi Arabia’s oil production test overall sentiment. Brandon Pizzurro, GuideStone Capital Management Portfolio Manager, joins Yahoo Finance's On The Move to discuss.
It may seem hard to believe following the carnage seen on Friday, Aug 23, but the S&P 500 is still higher by 1.2% over the past 90 days. Perhaps what is not surprising is that with stocks being smacked around on the back of trade tensions, tariff-sensitive sectors are suffering. This is true for some industrial ETFs as well.While not as export-dependent as the energy or technology sectors, industrials aren't as export-defensive as, say, healthcare, real estate or utilities. As such, the Industrial Select Sector SPDR (NYSEARCA:XLI), the largest industrial ETF, is lower by a market-lagging half a percent.To be fair, there are some bright spots among industrial ETFs, thanks in large part to a recent rebound by Dow component Boeing (NYSE:BA), meaning some aerospace and defense have been holding up. Conversely, some other industrial ETFs are languishing.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Tech Industry Dividend Stocks for Growth and Income Here, we'll look at some of the industrial ETFs investors would be best served by leaving alone for the time being. Invesco S&P SmallCap Industrials ETF (PSCI)Source: Shutterstock Expense ratio: 0.29%When small-cap stocks are part of the problem (and they currently are), not part of the solution, investors ought to steer clear of the related sector funds, including the Invesco S&P SmallCap Industrials ETF (NASDAQ:PSCI).Perhaps the best thing that can be said of this industrial ETF is that over the past 90 days, the fund has performed less poorly than the S&P SmallCap 600 Index. Then again, PSCI has been nearly three times as bad as the large-cap XLI over the same period.Two other marks again PSCI in the current climate. First, the fund devotes nearly 39% of its weight to growth stocks, a corner of the market under pressure due to trade tensions. Second, this industrial ETF's weight of just around 13% to aerospace and defense stocks is not large enough to offset weakness in its other industry exposures. iShares Transportation Average ETF (IYT)Source: Shutterstock Expense ratio: 0.43%Opportunities may still exist with transportation funds, but the iShares Transportation Average ETF (CBOE:IYT) is one of the more economically sensitive industrial ETFs out there and that's saying something. In a vacuum, IYT's 3.6% three-month slide is concerning, but it's even more concerning in the broader context of transportation stocks being viewed as accurate tells of broader market direction.Residing more than 16% below its 52-week high, this industrial ETF face near-term technical challenges because it also labors below its 50- and 200-day moving averages. IYT fits the bill as an industrial ETF to watch, but not one to buy right now. * 10 Companies Using AI to Grow "Just as some equity analysts were providing commentary about potentially becoming more constructive on the transportation stocks, the next shoe dropped," according to Freight Waves. "While investors were purportedly sniffing around the space looking for bargains, likely not interested in a full basket approach to owning the transports, a new round of Chinese tariffs were announced, taking the breath out of the transports." First Trust RBA American Industrial Renaissance ETF (AIRR)Source: Shutterstock Expense ratio: 0.70%The First Trust RBA American Industrial Renaissance ETF (NASDAQ:AIRR) would be one of those industrial ETFs that when the sector is working, it could really deliver for investors. However, that is not the current state of affairs for the sector and last Friday's price action suggests AIRR's 8.41% month-to-date loss could easily increase.AIRR isn't a pure industrial ETF; it allocates about 10% of its weight to financial services stocks, but if industrial exposure is going to be augmented right, best not to do it with another scuffling sector. Compounding that issue is that AIRR's bank holdings are located in states that are major manufacturing centers, a trait that is only valuable if the U.S. can continue avoiding a recession.Hopefully, that will be the case, but this industrial ETF has another reason to avoid it: the median market value of its 56 holdings is around $1.5 billion, meaning it's a small-cap fund at a time when smaller stocks are languishing. John Hancock Multifactor Industrials ETF (JHMI)Source: Shutterstock Expense ratio: 0.40%The John Hancock Multifactor Industrials ETF (NYSEARCA:JHMI) is another example of an industrial ETF that would certainly be worth embracing if sentiment surrounding the sector wasn't as dour as it is now. Technically speaking, there are concerns here, chief among that a drop of the 200-day line that JHMI is clinging to could lead to rapid share price erosion.JHMI is advertised as a multi-factor fund, but the factors it emphasizes -- value, size and profitability -- are not used in its security selection process. JHMI and other Hancock's other sector ETFs track indexes developed by Dimensional Fund Advisors."Dimensional's approach to sector indexing directly targets factors associated with higher expected returns, provide broad diversification to increase the reliability of capturing sector beta relative to strategies that are concentrated or ignore market prices, and aim to limit turnover to trades that meaningfully affect expected returns," according to ETF Trends. * 7 of Worst ETFs -- Boot These From Your Portfolio Right Now In fairness to this industrial ETF, it has been performing less poorly this month traditional industrial ETFs, indicating that if risk appetite is renewed and cyclical stocks rally, this fund is poised for some upside. iShares Global Industrials ETF (EXI)Source: Shutterstock Expense ratio: 0.46%As its name implies, the iShares Global Industrials ETF (NYSEARCA:EXI) is a global ETF, meaning investors should expect hefty exposure to domestic equities with sprinkles of industrial stocks from other large developed markets. That would be an alluring combination if the world's two largest economies weren't mired in a trade war and some other big economies weren't flirting with recessions.However, those are conditions investors are contending with right now and as a result, EXI is trailing the MSCI All-Country World Index by 100 basis points this month. EXI allocates over 68% of its combined weight to the U.S. and Japan, but a significant portion of the remaining portfolio is allocated to Europe, a region where several major economies are weakening. Oh yeah, President Trump could easily target Europe with trade tariffs, too.Even if cyclical stocks can get their mojo back, the moving geographical parts of EXI may say that investors looking to wade back into industrials would be better served doing so with a domestic focus. EXI only trades at a slight discount to the MSCI ACWI Index, which could be too much optimism given the recent lethargy in the industrial sector.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Tech Industry Dividend Stocks for Growth and Income * 7 Stocks the Insiders Are Buying on Sale * 7 of the Worst Stocks on Wall Street The post Just Leave These 5 Industrial ETFs Alone for Now appeared first on InvestorPlace.
Inverted yield curve is not as scary as it seems to be. Wall Street staged a rally on many such occasions. So, investors can easily bet on these top-ranked ETFs.
On CNBC's "Fast Money Halftime Report," Jon Najarian said he saw unusually high options activity in the Nov. $39 calls in iShares FTSE/Xinhua China 25 Index (NYSE: FXI ). Almost 16,000 contracts ...
While the delay in tariff has been greeted by the broad stock market, sectors which are the most sensitive to trade issues, seem to be the biggest beneficiaries.
The release of earnings results of four major players in the industrial sector makes us study the impact on certain ETFs with high exposure to these in-focus companies.
With General Electric scheduled to release Q2 earnings soon, we discuss some ETFs with high exposure to this American multinational conglomerate.
The Industrial Select Sector SPDR (XLI) , the largest industrial exchange traded fund by assets, is higher by more than 23% year-to-date and that upside could be extended if the Federal Reserve, as expected, proceeds with cutting interest rates at its meeting this week. “All is not ideal for industrial stocks right now,” reports Al Root for Barron's.
General Electric (GE) is slated to report its Q2 results on Wednesday. Let’s look at what analysts expect from the company in the second quarter.
Given Caterpillar's woes, investors wanting to avoid CAT could consider industrial ETFs that have no exposure to this machinery giant. However, risk-tolerant investors might consider this as a buying opportunity.
On Wednesday, the Dow Jones fell while other major US indexes moved up. The Dow was mainly pulled down by two of its high-weighted stocks—Boeing (BA) and Caterpillar (CAT).
3M Company (NYSE:MMM), a coveted member of the Dow Jones Industrial Average since 1976, is an industrial conglomerate. The group got its start in the early 20th century by extracting corundum mineral.Source: Shutterstock These days, however, 3M stock has expanded beyond corundum to the point of recent conundrum. After reaching an all-time high of $259.77 in Jan. 2018, MMM stock price has been in a multi-month decline. Year-to-date, 3M stock price which has missed the broader market rally in 2019, is down about 8%.As MMM stock gets ready to report earnings on July 25, many of our readers are wondering whether July may offer a good entry point into MMM shares, which are currently trading around $175. Here is a candid look at the the prospects for 3M stock so that potential investors may decide if the shares should belong in their long-term portfolio.InvestorPlace - Stock Market News, Stock Advice & Trading Tips How Does 3M Stock Make Money?Although most consumers first think of 3M's ever-popular signature products, e.g., Scotch Tapes and Post-it Pads, the company produces and sells a diverse line of products ranging from adhesive tapes to air filters, filters for computer screens, heatshrink tubing, knee supports, lint rollers, lubricants, safety goggles, and sand paper.To be more precise, its current product range includes over 50,000 items. In other words, most consumers would probably feel somewhat lost while looking through 3M's website. And very few companies would have the capital, time, or technology to build market share in many of the lines of business.The group divides its business into five segments: * Industrial (such as tapes, adhesives, and supply chain management software); * Safety and Graphics (such as protective gear and security products); * Electronics and Energy (such as fibers and circuits); * Health Care (such as medical and surgical products as well as drug delivery systems); and * Consumer (such office supplies and home improvement products).However, with this kind of growth and business range, a big headache has also come; 3M Company is simply too large to run efficiently, i.e., bigger is not necessarily better. MMM Stock's First-Quarter Results Were DisappointingOn Apr. 25, 3M released Q1 2019 results with lower-than-expected earnings. CEO Mike Roman summed up the earnings results in one sentence when he said "The first quarter was a disappointing start to the year for 3M." * 10 Stocks to Sell for an Economic Slowdown MMM stock's EPS came at $2.23, adjusted vs. $2.49 expected. Revenue was $7.863 billion, instead of the expected $8.025 billion. Management partly blamed a litigation-related pretax charge of $548 million, or 72 cents per share, for the poor results.The group also cut 2019 guidance and announced plans to lay off 2,000 workers. Wall Street was not impressed and the stock tumbled.Going forward 3M's five business segments will be restructured into four. Management has been trying to paint a better future picture for MMM stock as the company believes it will increase productivity, reduce costs, and increase cash flow levels.However, Wall Street is not necessarily hopeful about the company's upcoming Q2 results as many analysts do not necessarily expect 3M stock's results to show any signs of real recovery. Is MMM Stock's Dividend Safe?In a low-interest rate environment, stock investors pay special attention to shares with robust dividend yields. Dividend stocks can be one of the best ways to generate a regular passive income for long-term shareholders.In general, big blue-chip names tend to be consistently generous dividend payers. And 3M, which has increased its dividend for decades, has traditionally been regarded as a safe dividend play.Yet with the recent poor results and on-going issues, analysts have also started wondering whether MMM stock's dividend may also be cut.The dividend payout ratio can show investors if a stock is paying out either less or more than the company earns. In other words, if a company earns $1 per share but pays a dividend of $1.30, management may have to decrease the dividend at some point in the near future. A payout ratio of over 100% means that a company is paying out more in dividends than it earns.MMM stock's payout ratio is 0.59 which makes the dividend sustainable as long as the company keeps the earnings around the current levels. However, in case of a miss in earnings, I'd become sceptical of the dividend amount and would even expect a cut.Experienced dividend investors also pay close attention to a company's free cash flow as dividends are ultimately paid out of cash.Free cash flow is what remains in the bank after 3M has paid interest on its debt, paid any taxes owed, and made all of the capital expenditures necessary to run and invest in the giant business. MMM stock's capital structure has been under stress due to legal liabilities and decreasing revenue.Companies do not cut dividends in good times. And 3M Company is clearly going thorugh a difficult patch in its history. If there were further external events (such as increased trade tensions with China or a slowing down of the U.S. economy) as well as company-specific problems, it is possible that management may take the extraordinary measure of cutting MMM stock's dividend. Where is 3M Stock Price Now?On June 3, MMM stock hit a 52-week low at $159.32. In other words, as it hovers around $175, 3M stock is trading just above its 52-week lows right now. The downtrend since Jan. 2018 as well as Apr. 25, 2019 is a stark reminder that its all-time high of $259.77 is now in the rear-view mirror.If you are an investor who also pays attention to technical analysis, then you may want to know that over the past 18 months, 3M stock has suffered from a damaging technical picture.In addition to its long-term technical chart which still looks weak, MMM stock's short-term technical chart, trend lines and support and resistance levels, are telling investors to exercise caution.Although MMM stock's momentum indicators, which describe the speed at which prices move over a given time period, are currently in oversold territory, they can stay oversold for quite a long time, especially when the overall trend is down.Therefore, buy signals based on momentum indicators need to be conﬁrmed with further chart analysis before the stock is a buy from a technical standpoint.Among 10 Wall Street analysts, there is one strong buy rating, seven hold ratings (which effectively mean sell) and two sell ratings on 3M stock. Recently its price target was cut from $201 to $182. In other words, could MMM share price have already seen the high for 2019?If there is any broader market weakness, say due to market worries over U.S.-China trade wars, 3M stock price may be further adversely affected. * 7 Dependable Dividend Stocks to Buy At this point, the bulls are not yet in control and the selling pressure has increased especially after the Q1 earnings report of April 25. Therefore MMM shares will need a catalyst to make them attractive in the eyes of long-term investors, who are probably still skeptical about the near-term prospects for the company. The Bottom Line on MMM StockI am of the camp that 3M stock's price weakness is a clear reflection of investor sentiment and major fundamental worries, especially regarding a large conglomerate with legal woes and which is going through a major restructuring process amidst falling revenues.If you aren't already long MMM stock, you may want to remain on the sidelines until the earnings report on July 25 to give yourself time to study the balance sheet as well as the outlook by the management. Many questions, such as the effects of the current trade wars, decreasing margins, falling revenues, viability of the dividend as well as the level of free cash flow, remain yet to be answered.If you already own 3M shares, you may also consider initiating covered call positions in conjunction with being long MMM stock. For example, Aug. 16 expiry at-the-money (ATM) covered calls may enable you to hedge your long position in case of profit-taking following the earnings report. You would also be able to participate in a further up move in 3M stock price.If you are considering investing in 3M stock, you may want to start building a position between the $150 and $160, and expect to hold the stock for several years.Investors who are interested in buying into 3M Company shares, but do not want to commit all their capital to a single stock may also consider investing in various exchange-traded Funds (ETFs) that have MMM stock as a holding, including the SPDR Dow Jones Industrial Average ETF (NYSEARCA:DIA), Industrial Select Sector SPDR (NYSEARCA:XLI), or iShares Core High Dividend ETF (NYSEARCA:HDV).As of this writing, the author did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks Top Investors Are Buying Now * The 10 Best Cryptocurrencies to Keep on Your Radar * 7 Marijuana Penny Stocks That Could Triple (But You Won't Make Money) The post Ahead of Next Week's Earnings, Should Investors Buy 3M Stock Into Weakness? appeared first on InvestorPlace.