136.28 -1.70 (-1.23%)
Pre-Market: 8:45AM EST
|Bid||136.25 x 3200|
|Ask||136.49 x 1000|
|Day's Range||137.01 - 138.19|
|52 Week Range||121.54 - 152.95|
|Beta (5Y Monthly)||1.34|
|PE Ratio (TTM)||16.03|
|Forward Dividend & Yield||6.48 (4.70%)|
|Ex-Dividend Date||Nov 05, 2019|
|1y Target Est||N/A|
U.S. stock index futures hit new all-time highs on Friday, with investor optimism bolstered by an upbeat set of U.S. corporate earnings reports and indications of resilience in the Chinese economy. Optimism over a Phase 1 U.S.-China trade deal signed on Wednesday and recent upbeat data have raised hopes that the global economy may be picking up.
(Bloomberg) -- Follow Bloomberg on Telegram for all the investment news and analysis you need.It’s a tantalizing prospect for traders whose success often hinges on microseconds: a desktop PC algorithm that crunches market data faster than today’s most advanced supercomputers.Japan’s Toshiba Corp. says it has the technology to make such rapid-fire calculations a reality -- not quite quantum computing, but perhaps the next best thing. The claim is being met with a mix of intrigue and skepticism at financial firms in Tokyo and around the world.Toshiba’s “Simulated Bifurcation Algorithm” is designed to harness the principles behind quantum computers without requiring the use of such machines, which currently have limited applications and can cost millions of dollars to build and keep near absolute zero temperature. Toshiba says its technology, which may also have uses outside finance, runs on PCs made from off-the-shelf components.“You can just plug it into a server and run it at room temperature,” Kosuke Tatsumura, a senior research scientist at Toshiba’s Computer & Network Systems Laboratory, said in an interview. The Tokyo-based conglomerate, while best known for its consumer electronics and nuclear reactors, has long conducted research into advanced technologies.Toshiba has said it needs a partner to adopt the algorithm for real-world use, and financial firms have taken notice as they grapple for an edge in markets increasingly dominated by machines. Banks, brokerages and asset managers have all been experimenting with quantum computing, although viable applications are generally considered to be some time away.Why Quantum Computers Will Be Super Awesome, Someday: QuickTakeArbitrage OpportunitiesToshiba said its system is capable of calculating arbitrage opportunities for currencies in microseconds. The company has hired financial professionals to work on the project and aims to complete a real-world trial by March 2021.“Finance is the most familiar application,” Toshiba Chief Executive Officer Nobuaki Kurumatani said in an interview. “But there are so many uses. This is a technology with real potential.”Toshiba’s algorithm seems to outperform rival approaches on mathematical benchmarks, but how it will perform on real-world problems is anyone’s guess. Access to the company’s backtesting in currency trading and portfolio optimization isn’t publicly available and adopting the technology to a new problem would likely require rebuilding the algorithm from scratch.“There is a lot of talk about applications of quantum computing in finance, but it’s not very clear where it would be all that necessary,” said Takanobu Mizuta, a fund manager and senior researcher at Sparx Group Co. Optimizing a portfolio is not something that needs to be done in microseconds and calculations involved in high-frequency trading, where speed counts, are not very complicated, Mizuta said.Toshiba may choose to use the algorithm for areas outside finance. Other applications could include things like plotting complex shipping and logistics routes and developing new drugs with molecular precision, according to the company.First IdeaThe idea first arose in 2015, when senior research scientist Hayato Goto was exploring how the qualities of some complex systems can suddenly change with additional input, a phenomenon he describes as bifurcation. But it took him two years, he said, to realize the discovery could be used to craft algorithms that can efficiently sift through a huge number of possibilities -- like a quantum computer without the onerous requirements to run one.Goto partnered with Tatsumura, whose semiconductor expertise was crucial in making the calculations work on multiple processors in parallel.“We will see some ideas for specific applications of quantum computing coming out over the next five years,” said Masayuki Ohzeki, an associate professor at Tohoku University whose research focuses on the technology. “But real implementation will depend on when there is a good match between improvement in performance and techniques that simplify the calculations.”Toshiba revealed its Simulated Bifurcation Algorithm in April, initially garnering little attention outside the scientific community. In October, the company announced that its model had identified potential arbitrage opportunities in currency trading in just 30 microseconds -- fast enough, it claimed, to give it a 90% chance of making profitable trades. That triggered inquiries from financial institutions in Japan and abroad, Toshiba said.Quantum ComputingInvestment banks are already eyeing quantum computing as an opportunity and a threat. Goldman Sachs Group Inc. has been building an in-house research team and late last year joined forces with startup WC Ware to speed up the search for a “quantum advantage.” Japan’s Nomura Holdings Inc. has partnered with Ohzeki’s lab at Tohoku University to explore applications in asset management using a machine made by Canada’s D-Wave Systems Inc.“Right now, what you can do with it is still hypothetical,” said Kazuyuki Takeda, a general manager at Mizuho-DL Financial Technology Co., a research arm of one of Japan’s biggest financial groups. “It will take quite a bit of time before we have practical uses of quantum computing. At least 10 years or so.”Alphabet Inc.’s Google claimed in October that its quantum computer -- built on a custom processor with bespoke cryogenic cooling -- could perform a task in 200 seconds that would take today’s fastest supercomputer 10,000 years. Researchers at IBM have countered, saying that their supercomputer can match Google’s Sycamore processor “in a matter of days.” But that cluster of machines occupies an area the size of two basketball courts inside the Oak Ridge National Laboratory. In either case, the cost of quantum-like computational capability appears to still be prohibitively high for most applications.In the meantime, Toshiba is hoping it will succeed in commercializing its new algorithms -- whether in finance or elsewhere -- by delivering a computational edge with existing technology.“We give ourselves about a one-year lead for the stuff that we release publicly,” Goto said. “The more cutting-edge knowledge we have internally gives us confidence that we won’t be easily caught up with.”(Updates with expert comment and latest developments in quantum computing.)\--With assistance from Michael Patterson.To contact the reporters on this story: Pavel Alpeyev in Tokyo at email@example.com;Grace Huang in Tokyo at firstname.lastname@example.org;Shoko Oda in Tokyo at email@example.comTo contact the editors responsible for this story: Edwin Chan at firstname.lastname@example.org, Vlad Savov, Tom RedmondFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
With most blue-chip companies' earnings scheduled over the coming weeks and sentiments being mixed, investors should closely monitor the movement of the Dow ETF.
Soft enterprise spending could set up a big challenge for International Business Machines Inc. in 2020, so how Big Blue spins its forecast for the year will carry a lot of weight when the company reports earnings.
DOW UPDATE Shares of UnitedHealth and Pfizer are posting positive momentum Wednesday morning, sending the Dow Jones Industrial Average into positive territory. The Dow (DJIA) is trading 153 points, or 0.
IBM's Q4 performance is likely to have gained from growing adoption of cloud solutions. However, currency rate fluctuations and declines in IBM Z product cycle may have been concerns.
Some U.S. tech companies have a simple solution to a raft of new laws that impact their businesses: Fight them in court or interpret them in the best light possible.
Companies set a record for the largest number of U.S. patents in 2019, boosted in part by a patent surge from Chinese giants like Huawei.
International Business Machines (IBM) reports Q4 earnings after market close on January 21, 2020. Can the company boost revenue in its Global Technology Services segment?
Shoppers everywhere like to find the best value; that’s a given. And investors? Well, investors are just a special case of shoppers – in this case, shopping for stocks. So, how can we define a good value when it comes to stocks? In short, we’re looking for high upside and high dividend yields.TipRanks, a platform that tracks and measures the performance of analysts, offers a set of tools to search the raw data collected from 5,700 Wall Street financial experts and 6,500 publicly traded companies. The basic tool, the Stock Screener, gives investors a set of filters to screen the data and find the stocks that fit the desired profile.Setting the filters to show us stocks with a price target upside above 10% and a dividend yield above 2.5% brings the list down to a manageable 46 companies – that will offer investors a true value for their stock purchase. Let’s look at three of them that have a top spot in the S&P 500.Broadcom, Inc. (AVGO)We’ll start with Broadcom, a stand-by of the semiconductor chip industry. Broadcom’s 2019 sales numbers are not in yet, but it finished 2018 as the sixth largest chip maker by revenues, bringing in $18.46 billion. Riding high from that sales figure, Broadcom stock gained 28% in 2019, matching the broader stock market figures.In December’s fiscal Q4 earnings report, AVGO showed revenue and earnings both above the forecasts. The top-line sales figure was $5.78 billion, up 6.25% year-over-year and up 5% sequentially from Q3. Earnings showed a less impressive gain, but the annual EPS of $5.39 beat the expectation by a half-percent.AVGO shares are well positioned for price appreciation; they are also one of the market’s true dividend champions. The company raised the December dividend payment, to $3.25 per quarter, making the annual payment $13 and the yield 4.34%. That yield is well above the 2% average among S&P-listed companies, and the December increase caps a three-year run of consistent dividend increases.Top analysts see AVGO as a healthy investment. Writing from Morgan Stanley, 5-star analyst Craig Hettenbach says, “We think the stock is poised to outperform after meaningfully lagging the past 2 years… If Broadcom is able to execute in software it would add to what we view as a very compelling franchise in semis (66% weighted market share across 60% of revenue in duopoly structures), creating a diversified and highly profitable and cash generative business.”Hettenbach accordingly rates the stock a Buy, and puts a price target of $367 on the shares, indicating an upside potential of 23%. (To watch Hettenbach’s track record, click here)Mark Lipacis, the eighth-ranked analyst overall in the TipRanks database, agrees that AVGO is poised for gains. Noting that the “company's dividend policy is to return 50% of previous year's FCF to shareholders in the form of a dividend,” he goes on to add, “AVGO expects 6-8% growth in Core Semiconductor business over the next few years. Software business is becoming more predictable and expected to be $7bn in F2020.”In line with his optimism and Buy rating, Lipacis bumped his price target here up by 8%, to $350, implying a 17%. (To watch Lipacis’ track record, click here)Broadcom’s Strong Buy consensus rating is based on 21 analyst reviews, including 16 Buys and 5 Holds. Shares are not cheap, at $299.22, but the average price target suggests room for a 18% upside growth potential this year. (See Broadcom stock analysis at TipRanks)Chevron Corporation (CVX)Chevron, one of the world’s largest oil producers, with a market cap of $220 billion, is facing rough market conditions. Prices in the oil markets are low – 2H19 saw market bottoms near $52 for WTI – while overhead costs remain high. The combination pushed revenue down from ~$14 billion in 2018 to ~$12 billion in 2019.In CVX’s most recent earnings report, for Q3 2019, the company showed a 6% miss on EPS, with the bottom-line number at $1.36 for the quarter. Revenues were down by 4%, at $36.12 billion. During the quarter, the price of crude oil and natural gas liquids fell 24%, from $62 one year ago to $47 per barrel equivalent. A 3% increase in total production helped mitigate the losses.Even though revenues and EPS are down, CVX has been able to maintain its high dividend payout. Oil is an essential commodity, so there will always be a market for it, and cash flow for the oil companies. CVX uses those facts to back up a 4.09% dividend yield, with an annualized payment of $4.76. This yield is approximately double the S&P’s average dividend yield, and well over double the yield of the 2-year and 10-year US Treasury bonds.Piper Sandler analyst Ryan Todd sees the bottom line on CVX supporting a Buy rating. He writes, “Despite the well-telegraphed headwinds, we continue to see CVX’s peer-leading portfolio breakeven and attractive FCF outlook as supporting leading growth in dividends/shareholder returns amongst its peers.”Todd’s $143 price target on CVX shares implies room for a 23% upside. (To watch Todd’s track record, click here.)Roger Read, reviewing CVX for Well Fargo, lays out an upbeat track for the company in 2020: “Driven by its unconventional plays, deepwater assets and LNG projects, [we see CVX bringing in] modest, returns-focused production growth expectations, expanding margins from high-grading and cost controls, dividend growth, potential share repurchases and solid balance sheet.”Read gives CVX a Buy rating with a $142 price target, showing his confidence in 22% forward growth. (To watch Read’s track record, click here)The difficulties of the oil market can be seen in Chevron’s analyst consensus, a Moderate Buy rating based on 6 Buys, 3 Holds, and 1 Sell. The average price target of $137 implies an upside of 18% from the $116 current trading price. (See Chevron’s stock analysis at TipRanks)International Business Machines (IBM)The last stock on our list is an old-name blue-chip standard of the markets, and a long-time component of the Dow Jones index, IBM. It’s a name that everyone knows – IBM got its start in business tech when that meant gear-driven mechanical calculators and card-punch time clocks. After WWII, IBM was at the forefront of the electronic computer revolution, evolving from punch card machines to magnetic tape drives to the early floppy disks. The ubiquitous PC got its start with an IBM operating system. Today, business tech is moving toward the cloud, and IBM acquired cloud innovator Red Hat last year, to get a foothold in the cloud market. With a market cap of $121 billion and annual revenues in the neighborhood of $80 billion, IBM has plenty of resources to change direction.Staying at the top isn’t cheap, though. IBM had to spend $34 billion on the Red Had acquisition, and saw a major bookkeeping loss in its most recent reported quarter, Q3 of 2019. The quarterly revenue hit was heavy – the top line was down $190 million to, to $18.03 billion. On the positive side, Red Hat, in its first quarter as a subsidiary, saw revenues rise 20%, and EPS was in line with the forecasts, at $2.68.While closing the Red Hat deal, IBM management announced that it would freeze the dividend at current levels for at least the next year. While this forestalls growth, the actual payment remains high - $1.62 per quarter. Annually, this translates to $6.48 and a yield of 4.74%. IBM has, since 2011, committed to maintaining the dividend payment, as a boon to investors.Matthew Cabral, 4-star analyst with Credit Suisse, is upbeat on IBM. He notes the “solid start” of Red Hat as part of the IBM parent company, and then adds, “[W]e think that inflection starts in 4Q, with an early boost from mainframe before passing the baton to Red Hat and the related pull-through of “core” IBM in CY20. Indeed, early progress on Red Hat is encouraging and we continue to believe the acquisition significantly improves IBM’s standing in the rapid push toward hybrid cloud.”Cabral backs his outlook with a Buy rating and a $173 price target. His target suggests room for 26% share appreciation in 2020. (To watch Cabral’s track record, click here)IBM’s Moderate Buy consensus rating reflects the company’s recent mixed results on revenues, and debt from the Red Hat purchase. The stock has an even split – 4 Buy ratings and 4 Holds. Shares sell for $136, and the average price target of $162.67 implies an upside potential of 19%. (See IBM stock analysis at TipRanks)
(Bloomberg) -- Huawei Technologies Co. broke into the top 10 recipients of U.S. patents last year, according to an analysis of filings with the U.S. Patent and Trademark Office, the latest sign that Chinese companies are aggressive in pursuing the U.S. lead in global technology.The telecom company’s 2,418 patents, along with 2,177 new patents issued to display-screen maker BOE Technology Group, help propel China into the rank of fourth-biggest recipient of U.S. patents, behind Japan and South Korea but ahead of Germany for the first time, according to the analysis by Fairview Research’s IFI Claims Patent Services.“China’s growing rapidly but they’re still way behind the U.S. in terms of patents,” said Larry Cady, a senior analyst with IFI.International Business Machines Corp. retained its title of top recipient of patents for the 27th year, with a record 9,262 patents, far ahead of No. 2 Samsung Electronics Co. and No. 3 Canon Inc.Overall, the patent office issued 333,530 patents, an all-time high and a 15% jump after a decline in 2018. Cady said the increase likely reflects efforts to release a bottleneck over what can qualify for a patent, such as in the fields of artificial intelligence.AI, cloud computing, blockchain and security were among the top areas for IBM, the Armonk, New York, company said. The IBM patents reflect the work of more than 8,500 inventors over 45 states and 54 countries, the company added.While IBM may be consistently the top recipient of patents, its holdings aren’t the largest, IFI found. That title belongs to Samsung Electronics Co. of South Korea, with Canon Inc. of Japan the second-largest corporate owner of patents. The difference, Cady said, is that IBM doesn’t keep all of its patents.“We really look at new patents as an indication of innovation and we regularly review and prune our patent assets,” said Jason McGee, chief technology officer for IBM Cloud Platform. “We may get rid of ones that we don’t think are strategic or could be better served with someone else.”IBM also announced that it’s joined the License on Transfer, or LOT, Network, which was co-founded by Red Hat Inc. IBM bought the software company for $34 billion last year.Group members pledge that all network members will get a license to any patent that ends up with what’s known as a “patent assertion entity,” meaning a company that doesn’t make products and whose sole purpose is to extract royalties from those who do. The group helps protects automakers and retailers who are just entering the technology arena that’s often marked by lawsuits.“If you want to be any successful company, you have to be a successful high-tech company,” said Ken Seddon, head of the LOT Network.Overall, the list of top recipients is dominated by American and Asian technology companies. Behind IBM, Samsung and Canon are Microsoft Corp., Intel Corp., LG Electronics Inc. and Apple Inc. topping the list after Canon. Ford Motor Co., which broke into the top 10 last year, was just ahead of Amazon.com Inc. and then Huawei.While the numbers are small, the fastest-growing patent classifications were in the gene-splicing technology known as CRISPR, hybrid plants, 3-D printing and cancer therapies, the analysis showed.Many of the patents issued to Huawei relate to things like high-frequency transmission that are needed for the next generation of wireless technology known as 5G.President Donald Trump’s administration in May moved to restrict U.S. companies from doing business with Huawei. The administration has said Huawei gear could be used for spying -- an allegation the company denied.“The U.S. is kind of at a funny position with Huawei -- we’re threatening them with limiting access to technology and access to the markets,” Cady said. “At the same time, 5G is rolling out and they’re the dominant in 5G.”To contact the reporters on this story: Susan Decker in Washington at email@example.com;Christopher Yasiejko in Wilmington, Delaware, at firstname.lastname@example.orgTo contact the editors responsible for this story: Jon Morgan at email@example.com, Elizabeth Wasserman, John HarneyFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
“ITG is focused on the [information technology] modernization and cloud market, which is a rapidly growing market in the federal arena,” Wasson said in an interview. “It’s a scenario where we’ve been building organically, but we certainly needed and wanted more scale and greater depth of capabilities in this area.” The $255 million deal, funded by a mix of ICF's operating cash flow and company credit, bolsters the larger company's holdings in the technology consulting market by adding capabilities such as enterprise architecture development, cloud platform implementation, agile systems engineering and next-generation tech — all markets that ITG specializes in and ICF now hopes can help fulfill the federal government’s thirst for lucrative digital transformation contracts.
Evercore ISI analyst Amit Daryanani reduced his rating on IBM stock to In Line from Outperform, while trimming his price target on the tech giant’s shares to $145 from $160.
Shares of International Business Machines Corp. are off 0.5% in premarket trading Monday after Evercore ISI analyst Amit Daryanani downgraded the stock to in-line from outperform. "We see macro headwinds combined with a difficult H1:20 setup that warrants incremental caution especially given the current net leverage," he wrote. While Daryanani thinks that the combined IBM/Red Hat is "well positioned to enable the shift to hybrid era for large enterprises," he worries that the company's December-quarter expectations might be too aggressive "given slower enterprise backdrop highlighted by IBM itself in addition to comments from peers such as Cisco, Dell, etc," even if the mainframe business offsets those challenges. Looking ahead, Daryanani said that the consensus revenue estimate for 2020 suggests 1% to 2% organic growth (excluding Red Hat), which he said is "optimistic versus peer commentary." He lowered his price target to $145 from $160. IBM's stock has falled 4.3% over the past three months, as the S&P 500 has added 9.9%.
Ivanka Trump was greeted with polite applause despite some bruising words in the days leading up to Tuesday’s keynote presentation on future work at CES with Consumer Technology Association Chief Executive Gary Shapiro.
It's that time of year when Wall Street offers up its many forecasts for the coming 52 weeks, based on anything from earnings growth to interest rates to the possibility of a coming recession - and in 2020, the incessant noise coming from Washington.Investors are glued to their screens waiting for these oft-faulty prognostications. That's unfortunate, because there's a better way to plan out your year: the Dogs of the Dow.The Dogs of the Dow is a set-it-and-forget-it plan involving Dow dividend stocks (more on that in a minute). It takes decision-making out of your hands by deferring to the market itself. As long as three concepts are true - the market moves higher in the long run, stocks move into and out of favor, and Dow companies tend to be blue-chip stocks that are intelligently managed and financially stable - the Dogs will do well over time.That third concept might be debatable when you look back on all the companies that have been booted from the Dow. Remember: General Electric (GE) and Sears (SHLD) used to be members. But for the most part, the Dow remains a blue-chip index.Read on as we explain the Dogs of the Dow, then analyze the 10 Dow stocks this strategy says you should buy. SEE ALSO: The 20 Best Stocks to Buy for 2020