• When To Buy Growth Stocks: Cup Without Handle Can Pour The Gains
    Investor's Business Daily

    When To Buy Growth Stocks: Cup Without Handle Can Pour The Gains

    Think stock chart analysis in growth stocks is bewildering? Take comfort knowing only a few patterns are worth identifying. Learn the cup without handle.

  • Paying your bills in bitcoin? Watch out for these tax issues

    Paying your bills in bitcoin? Watch out for these tax issues

    Bottom line: virtual currency has gone mainstream. In fact, virtual currency transactions are a hot-button issue with the IRS, and you can understand why. Coinbase claims it has now has over 30 million accounts.

  • Nvidia (NVDA) Up 22.3% Since Last Earnings Report: Can It Continue?

    Nvidia (NVDA) Up 22.3% Since Last Earnings Report: Can It Continue?

    Nvidia (NVDA) reported earnings 30 days ago. What's next for the stock? We take a look at earnings estimates for some clues.

  • Goldman Is Using JPMorgan’s Own Tactics Against It in ETF Battle

    Goldman Is Using JPMorgan’s Own Tactics Against It in ETF Battle

    (Bloomberg) -- Goldman Sachs Group Inc. is throwing everything but the kitchen sink at boosting its share of the $4 trillion U.S. market for exchange-traded funds -- even mimicking one of its Wall Street foes.The bank is adopting an approach pioneered by JPMorgan Chase & Co., filing for a line of broad-based index products that could start trading at rock-bottom prices as early as next week, regulatory records show.After getting off to a blistering start four years ago on the back of a dirt-cheap factor ETF, Goldman dropped behind its Wall Street competitor, which has ridden a strategy dubbed “bring your own assets” to a $29 billion business.Essentially cloning popular ETFs and moving client cash from those products into its own, the controversial approach may be Wall Street’s best hope for challenging the dominance of State Street Corp., BlackRock Inc. and Vanguard Group.“As we continue to grow and build out our ETF business, along with our recent acquisitions, it just makes sense in some areas for us to have the building blocks that fuel those portfolios,” said Steve Sachs, head of capital markets for ETFs at Goldman.Even before this latest chapter, the race between the Wall Street giants had enough twists and turns to power a thriller.Goldman emerged in 2015, establishing itself as a leader in factor investing with its ActiveBeta U.S. Large Cap Equity fund, ticker GSLC. The product wowed the ETF industry with a fee of just 9 basis points, unheard-of for smart beta strategies -- but newer ventures have stumbled. This year, it introduced a handful of thematic strategies, but they’ve collected less than $50 million.JPMorgan was relatively quiet until June 2018, when it kickstarted its business with a suite of vanilla ETFs called BetaBuilders. Unlike the more specialized products the bank was hawking up until then, the funds tracked broad developed-market benchmarks -- at thrift-store prices.It was an inspired play, tripling JPMorgan’s ETF assets to near $30 billion within a 14-month span and powering it ahead of Goldman.“JPMorgan saw this as a smart move ahead of anyone,” said Bloomberg Intelligence analyst Eric Balchunas. “We’ve seen how hard it is to get any assets. But bringing your own assets gets you mojo, and mojo gets people in the door and investors on the phone.”The bank made smart moves elsewhere, winning a foothold in the nascent but growing fixed-income ETF market, and planting a flag early in Europe, whose industry is around half the size of the U.S. but growing rapidly.Goldman has yet to list an ETF in the region despite some high-profile hires, though it plans to commence the business before year-end, a spokesman in London said. That puts it several years behind JPMorgan, which has $2.8 billion in assets there.Now Goldman hopes to turn the tables on its investment-banking rival by embracing the bring-your-own-assets strategy. The firm already has some experience in the area as the largest owner of GSLC, and its latest foray is fueled by a recent acquisition spree. The bank scooped up S&P’s model portfolio business and United Capital this year, giving it fresh pipelines for flows into its own funds.However, the approach isn’t without its critics, who argue there are conflicts in directing wealthy clients to a bank’s own ETFs.“We have internal affiliates in our products, but they are institutional clients and we treat them as such with their own due diligence,” said Jillian DelSignore, head of ETF distribution for JPMorgan’s asset management arm.The bank’s transfers into BetaBuilders have saved clients about $42 million a year thanks to their low price tag, according to an analysis by Bloomberg Intelligence.Ironically, if Goldman succeeds in moving wealthy clients to its in-house products, BlackRock may turn out to be the biggest loser, according to an analysis of regulatory filings.United Capital’s clients hold some $4 billion in the firm’s iShares line, which could be redeployed into Goldman’s new products. That’s especially true if the funds are cheap.“The advisers -- by being so brutal with cost obsession -- have created this monster of cost migration,” said Balchunas. “By making moves like this, the banks are able to own the end client and the flows. It’s brutal out there.”\--With assistance from Morgan Tarrant.To contact the reporters on this story: Carolina Wilson in New York City at cwilson166@bloomberg.net;Ksenia Galouchko in London at kgalouchko1@bloomberg.net;Elizabeth Rembert in New York at erembert@bloomberg.netTo contact the editors responsible for this story: Brad Olesen at bolesen3@bloomberg.net, Yakob Peterseil, Rachel EvansFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Barrons.com

    Analysts’ views on Netflix, Chipotle, TD Ameritrade, and Varian Medical

    Netflix’s original slate dwarfs the new entrants. As the industry transitions toward a larger mix of digital transactions, we believe that Chipotle is in a leading position to establish a digital moat.

  • Barrons.com

    Book Excerpt: The Making of a Contrarian Investor

    Ariel Investments’ Rupal J. Bhansali explains how to prosper by betting against the crowd. A smart wager on Microsoft, a hard look at France

  • Goldman Sachs (GS) Gains As Market Dips: What You Should Know

    Goldman Sachs (GS) Gains As Market Dips: What You Should Know

    In the latest trading session, Goldman Sachs (GS) closed at $219.90, marking a +0.53% move from the previous day.

  • Square (SQ) Gains As Market Dips: What You Should Know

    Square (SQ) Gains As Market Dips: What You Should Know

    Square (SQ) closed the most recent trading day at $58.32, moving +0.92% from the previous trading session.

  • WeWork Plows Ahead With IPO, Reshapes Board to Counter Skepticism

    WeWork Plows Ahead With IPO, Reshapes Board to Counter Skepticism

    (Bloomberg) -- WeWork is pressing ahead with plans for a public listing, announcing a series of governance changes aimed at shoring up a sagging valuation and assuaging critics who say it gave too much power to a polarizing co-founder.The company will trim the voting advantage that gives chief executive officer Adam Neumann sway over the board, and no member of his family will be allowed to sit on the board, it said in a regulatory filing Friday. WeWork will also announce a lead independent director by year’s end.The moves aim to give potential investors a check on Neumann’s control of the company and address some of the most unusual dealings between founder and firm. But it left in place a rare three-class stock structure and Neumann still maintains a voting majority, so it’s unclear how much the changes will appease both investors and the banks in charge of managing WeWork’s IPO.Questions remain about how investors will value the fast-growing, money-losing office leasing business that’s backed by SoftBank. Both of the company’s lead financial advisers -- JPMorgan Chase & Co. and Goldman Sachs Group Inc. -- have previously voiced concerns about proceeding with an IPO at a valuation around $15 billion, people briefed on the discussions have said.The company and its advisers were discussing a valuation range of $15 billion to $20 billion Friday, people with knowledge of the talks said. SoftBank Group Corp., which with its affiliates is WeWork’s biggest backer with a 29% collective stake and invested in January at a valuation of $47 billion, is in discussions to buy about $750 million worth of additional stock in the offering, the people said. The company has been looking to raise at least $3 billion in the IPO, and SoftBank’s purchase would limit its dilution.Spokespeople for SoftBank and WeWork declined to comment. The Wall Street Journal reported SoftBank’s plans earlier Friday.The company plans to start its IPO roadshow as soon as Monday, though that timeline could be delayed depending on investor demand, said a person with knowledge of the matter. WeWork said Friday it picked Nasdaq as its listing venue.The new filing revealed that Neumann will return any profits he receives from the real estate transactions he has entered into with the company, and that any CEO who succeeds Neumann will be selected by board of directors.The board will have the ability to remove the CEO, and the updated prospectus has taken out a clause that previously said Neumann’s wife Rebekah -- who’s listed as a founder and chief brand and impact officer of WeWork -- will have a role choosing any new chief. Some criticized the changes as not going far enough.“This is an example of posturing,” Jeffrey Cunningham, who teaches management at Arizona State University and has served on several corporate boards, said of WeWork’s changes. The company appears to be facing pressure “to go public at a time that is inappropriate and with a governance record that is questionable.”Still, the moves drove WeWork bonds to be the biggest price gainers in high-yield bond trading for part of Friday. A Fitch Ratings analyst said the changes addressed many of the issues that the ratings company raised in downgrading WeWork’s credit grade last month.“A key component of WeWork’s model is the ability to restrain growth in the event of a downturn and these governance changes increase the likelihood that an independent board will have the power to enforce such a decision," Kevin McNeil, a director at Fitch, said in an emailed statement.WeWork, which leases and owns spaces in office buildings and then rents desks to businesses ranging from startups to large corporations, has raised more than $12 billion since its founding nine years ago and has never turned a profit.WeWork had been targeting a share sale of about $3.5 billion in September, people familiar with the matter said in July. A listing of that size would be second only to Uber Technologies Inc.’s $8.1 billion listing this year.After the company filed publicly for the offering in August, its valuation shrank amid investor scrutiny.WeWork has been driving ahead with its desire to IPO, in part to gain access to much needed capital. The company needs to raise at least $3 billion through an IPO to tap into an additional $6 billion credit line that bankers have been setting up in recent weeks. The facility requires the company to carry out its offering by Dec. 31, the people said.Share ClassesThe original IPO plan included three classes of common stock, with holders of Class A shares getting one vote per share, while Class B and Class C owners got 20 votes for each. This arrangement would have given Neumann the vast majority of the voting power.The company is changing its high-vote stock from 20 votes to 10 votes a share. But it’s keeping the different classes, which it says “may result in a lower or more volatile market price” of its Class A common stock in part because certain indices like the S&P 500 exclude companies with such structures.The high-vote stock will automatically decrease to one vote per share in the event that Neumann becomes permanently incapacitated or dies, something that would previously only have occurred if Neumann’s ownership fell to 5% or lower.The company already has taken some steps to improve its governance, such as adding a woman to its board and having Neumann return $5.9 million of partnership interests initially granted to him as compensation for trademarks used in a rebranding. Yet its IPO filing last month raised a variety of other concerns. Among them: The company paid Neumann rent and lent him money.Neumann will also limit his ability to sell stock in each of the second and third years following this offering to no more than 10% of his shareholdings. WeWork’s Class A stock has been approved for listing on Nasdaq under symbol “WE”.The New York-based company, which changed its name to the We Co. this year, disclosed in its filings that it had lost $2.9 billion in the past three years and $690 million in just the first six months of 2019. Its annual revenue, though, had more than doubled to $1.8 billion in 2018, compared with $886 million the previous year.(Adds latest valuation talks in fifth paragraph.)\--With assistance from Anders Melin, Tom Giles and Sarah McBride.To contact the reporters on this story: Gillian Tan in New York at gtan129@bloomberg.net;Giles Turner in London at gturner35@bloomberg.net;Michelle F. Davis in New York at mdavis194@bloomberg.netTo contact the editors responsible for this story: Liana Baker at lbaker75@bloomberg.net, Michael J. Moore, Dan ReichlFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • 14 Stocks Already Hurt by President Donald Trump's Tariffs

    14 Stocks Already Hurt by President Donald Trump's Tariffs

    America's nearly two-year-old trade war with China, as well as salvos with Europe and Mexico, has battered a wide swath of stocks. President Donald Trump's tariffs (and retaliatory duties) have weighed on companies in various forms, such as higher input costs and unsold inventory.The pinch is being felt on a wide scale. Global growth was already slowing, though market analysts and foreign leaders alike think the trade war is making things worse. Here at home, manufacturing is thinning, reflecting waning demand. ISM's purchasing managers' index reading for August was just 49.1. Anything under 50 signals a contraction in activity, meaning August was the first month in three years that American manufacturing receded.The result has been a pullback in numerous stocks. Buying these tariff-assisted dips is risky because some of the companies face headwinds outside of trade uncertainty. But a resolution between the U.S. and China would bring much-needed relief to many companies, and perhaps a bounceback in their shares. You can see the potential every time the market rallies on the smallest of optimistic hints."(These) value stocks will deliver attractive returns after the tariff resolution, like a coiled spring that pops up," says Michael Underhill, chief investment officer of Capital Innovations in Pewaukee, Wisconsin. He thinks the market could continue to move higher heading into October's negotiations. If more concrete progress is made, a sustained rally will continue, he says.Here, then, are 14 stocks that have already felt the burn from President Donald Trump's tariffs (and retaliatory taxes). Some represent potential should Washington reel in its tariff threats, but they may continue to suffer any time trade tensions reignite. And a few are trying to pivot their businesses out of harm's way. SEE ALSO: 25 Dividend Stocks That Analysts Love the Most

  • Moody's

    Advanced Micro Devices, Inc. -- Moody's upgrades Advanced Micro Devices' CFR to Ba2 and senior unsecured rating to Ba3; outlook positive

    Moody's Investors Service ("Moody's") upgraded Advanced Micro Devices, Inc.'s ("AMD") corporate family rating to Ba2 from Ba3 and senior unsecured rating to Ba3 from B1. The speculative grade liquidity rating of SGL-1 remains unchanged.

  • Is Shopify Stock A Buy Right Now? Huge Stock Market Winner Is Flashing A Long-Term Sell Signal
    Investor's Business Daily

    Is Shopify Stock A Buy Right Now? Huge Stock Market Winner Is Flashing A Long-Term Sell Signal

    Shopify has been a huge winner in 2019. Earnings are booming and the company plans to compete more with Amazon. But with software stocks under pressure, is SHOP stock a buy now?

  • Dividend Growth ETFs for Long Term Investors

    Dividend Growth ETFs for Long Term Investors

    Dividend growth ETFs hold companies with solid balance sheets and rising earnings.

  • Apple Says TV+ Service Won’t Harm Results, Rebutting Goldman

    Apple Says TV+ Service Won’t Harm Results, Rebutting Goldman

    (Bloomberg) -- Apple Inc. said a new video service won’t have a material impact on its financial results, seeking to counter research from a Goldman Sachs analyst who cut his share price target on concern that aggressive pricing of the TV+ offering will trim profit.Earlier this week, Apple outlined a strategy that involved lower prices on several devices and services, including a monthly cost of $4.99 for TV+. It will also be free for one year with purchases of new Apple devices. This is relatively rare for a company that has historically charged premium prices to support healthy profit margins.Rod Hall, the Goldman Sachs analyst who covers Apple, cut his price target on Apple shares to $165 from $187, saying the company’s plan to offer a trial period for TV+ was “likely to have a material negative impact” on average selling prices and earnings per share.“We do not expect the introduction of Apple TV+, including the accounting treatment for the service, to have a material impact on our financial results,” Apple said in an email.The stock jumped after the statement, trimming losses from earlier in the day. It traded down 1.8% at $219 at 2:56 p.m. in New York.The TV+ service is entering a crowded video-streaming field that already includes Netflix Inc., Amazon.com Inc., Hulu and AT&T Inc.’s HBO. In November, Walt Disney Co. plans to launch a Disney+ streaming service, with a giant catalog of titles, for $6.99 a month. Netflix’s entry-level subscription is $8.99 a month in the U.S.Apple, which doesn’t currently have a back catalog of content for TV+, announced the $4.99-a-month pricing on Tuesday, sparking a rally in its shares and declines in Netflix and Disney stock. In India, the TV+ service will be 99 rupees ($1.40) a month. (Updates with background on TV+ in final paragraphs.)To contact the reporters on this story: Mark Gurman in San Francisco at mgurman1@bloomberg.net;Nico Grant in San Francisco at ngrant20@bloomberg.netTo contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net, Alistair BarrFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.

  • Deutsche Bank Remains Sidelined on AMD Stock; Here’s Why

    Deutsche Bank Remains Sidelined on AMD Stock; Here’s Why

    Put another tech conference in the record books.On Tuesday, Deutsche Bank wrapped up its 2019 Technology Conference in Las Vegas, at which Advanced Micro Devices (AMD) CFO Devinder Kumar presented. In a note following the presentation, 5-star Deutsche Bank analyst Ross Seymore summarized the bank's "key takeaways" form the talk.As you'd expect from AMD, it was a tale of two cities -- or rather, different tales concerning AMD's two main divisions, Computing and Graphics (C&G) and Enterprise, Embedded, and Semi-Custom (EESC). Let's tackle the bad news first.EESCWith only $2.35 billion in sales last year, EESC is the smaller of AMD's two main business divisions, and by far the slower-growing as well. (It also boasts worse profit margins than C&G). Last year, AMD's EESC sales grew barely 3% year over year, and in fact remain stuck below sales levels of four years ago. Now, it looks like things will be taking a turn for the worse.Worse, through the end of 2019, AMD is looking for about a 35% decline in sales from the "semi-custom" portion of the business.That's the bad news. The good news is that elsewhere within EESC, things are going swimmingly -- and even in semi-custom, the news isn't quite as bad as the 2019 sales decline makes it look.For one thing, AMD is making great gains in its server business, targeting "double-digit" server market share at some point within the next two to four quarters. Buoyed by "significant traction" in sales of 7-nanometer CPUs, and a greater number of platforms adopting AMD's wares, the company even believes that it will eventually reach, then surpass, the 25% market share in servers that it once held more than a decade ago. Rivals Intel and NVIDIA are expected to respond to these gains, but AMD doesn't see their responses as much of a risk to its plans, calling them neither "broad-based" nor "pervasive."Meanwhile in semi-custom, the company is predicting that this year's sales slump will be followed by a ramp in sales in the second half of next year as Microsoft places orders to outfit its new Xbox gaming console in the latest in AMD tech.C>urning to AMD's flagship C&G division, with its $4.125 billion in annual sales and robust 11.4% operating profit margin, AMD is predicting growth in graphics chips in both Q3 and Q4 of 2019 (and in 2020 as well) "driven by both datacenter GPU and client GPU."Average sale prices for "compute" chips are also "up gen-on-gen for the latest generation of Ryzen, which should have a margin tailwind over time," Seymore reports. On the graphics side of the business, the analyst sees sales more than doubling in the second half (year over year), while in "compute," he's looking for more modest, but still respectable growth of 22%.Overall, Seymore is predicting 49% year over year sales growth in the C&G division in this year's second half -- a very rapid growth rate indeed.All that being said, at a share price approaching $30, and with most analysts still forecasting only about $0.47 per share in GAAP earnings this year, there's a very real question of whether AMD's prospects are already baked into the share price at its current valuation of more than 64 times earnings. Granted, Seymore takes a more optimistic view of earnings this year (predicting per-share profits of $0.64, so 47 times current-year earnings). But his 2020 prediction of $0.89 falls short of consensus estimates for $0.95 per share -- indicating that future growth may not be as robust as other analysts expect.Accordingly, despite all the good news AMD unveiled in Las Vegas this week, Seymore continues to stick with its "hold" rating on the stock, and its $29 price target.

  • The Hidden Reason to Buy Intel Stock

    The Hidden Reason to Buy Intel Stock

    As tech stocks go, Intel (NASDAQ:INTC) provides investors with potential upside while also providing a reasonable amount of downside protection should the global economy slow. Most InvestorPlace contributors, including myself, consider Intel stock a smart play at this point in the economic cycle. Source: JHVEPhoto / Shutterstock.com InvestorPlace - Stock Market News, Stock Advice & Trading TipsIf you're looking for a stock with a sound balance sheet and healthy free cash flow generation, there aren't many that can compete with INTC stock. Intel Stock Is a Safer PlayAt $53, the Intel stock price has room to move higher. In mid-August, InvestorPlace's Luke Lango suggested three catalysts existed that would move Intel stock to $60 within a few quarters. Since Luke made this call, INTC is up 12% and definitely on the move. * 7 Discount Retail Stocks to Buy for a Recession A few days before Lango's Intel buy recommendation, IP's James Brumley was positive about the company despite the fact it was well behind Advanced Micro Devices (NASDAQ:AMD) when it comes to launching a 7-nanometer processor. In early June, I argued that Intel's free cash flow yield of 6.7% suggested that it was getting closer to value territory. Up almost 20% in the three-and-a-half months since, its free cash flow yield has dropped to 5.4%, a good, if not great FCF yield. All things considered, Intel stock remains a safer play than some of its more volatile competitors. A Hidden Reason to Buy INTC StockFree cash flow and a sound balance sheet are smart reasons to own Intel. However, there's another reason why some investors might consider buying its stock: Cloudera (NYSE:CLDR), the leading enterprise data cloud provider.The California-based company has had a crazy year on the markets. Down 17% year to date through Sept. 12, it has gained back 82% of those losses in the past 90 days, a chunk of it coming in the past week as a result of better-than-expected Q2 earnings. In June, after reporting disappointing Q1 2019 results, CEO Tom Reilly announced his resignation effective July 31. The company has struggled with its $5.2 billion merger with HortonWorks, a combination that gives it more than $700 million in sales and 2,500 customers.What's this got to do with Intel?Intel owns 26.1 million shares of Cloudera, making it one of the company's largest shareholders with 9.3% of its stock. Intel originally invested $742 million in Cloudera in May 2014. With the HortonWorks merger, Intel's ownership stake was diluted down to less than 10%.In the three months ended July 31, Cloudera lost $87 million on $196.7 million in revenue. On a non-GAAP basis, it lost $7.4 million from operations in the quarter, $90 million less than a year earlier on a 16% increase in annualized recurring revenue. In 2020, it expects to lose between 24 cents and 28 cents a share on a non-GAAP basis with as much as $775 million in revenue. While Cloudera has great potential, the fact that it's struggling to make money has made it a difficult stock for analysts to get behind, with just six making it a buy out of 20 covering it. Carl Icahn Likes Intel Stock and ClouderaHowever, the company's troubles have caught the attention of Carl Icahn, who owns more than 18% of its stock. Although Cloudera is losing business to Amazon (NASDAQ:AMZN), Icahn believes that Cloudera stock is undervalued. Currently, Intel's ownership stake is worth much less than Cloudera's $15 IPO price. If you like Cloudera but are nervous about making a bet on it while it's still searching for a permanent CEO, buying Intel stock is a smart way to protect your potential downside. 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 * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money The post The Hidden Reason to Buy Intel Stock appeared first on InvestorPlace.

  • Sarah Ketterer's Favorite Tech Stocks

    Sarah Ketterer's Favorite Tech Stocks

    3 are among her top 10 holdings Continue reading...

  • Big Tech Troubles: Will Google Staff Work Hard?
    Market Realist

    Big Tech Troubles: Will Google Staff Work Hard?

    This week has been rough for big tech companies. On Monday, 50 states and territories announced that they're launching an antitrust investigation into Google.

  • Activision and 3 more momentum stocks to watch

    Activision and 3 more momentum stocks to watch

    Activision Blizzard (ATVI) rose 54 cents to $55.45 on 10.9 million shares Thursday, more than 1 1/2 times its average volume. The move, on an analyst upgrade of the electronic gaming company, popped the stock to as high as $57.52 intraday, above lateral resistance, before it backed off. Lattice Semiconductor (LSCC) jumped 88 cents, or 4.3%, to $21.01 on no news.

  • Billionaire Leon Cooperman Can’t Stop Talking About How Cheap These 5 Stocks Are
    Insider Monkey

    Billionaire Leon Cooperman Can’t Stop Talking About How Cheap These 5 Stocks Are

    I listened to Leon Cooperman’s talk at an event hosted by the New York Alternative Investment Roundtable. There were a few members of the media present at the event and they decided that the most interesting part of Cooperman’s talk was his comments regarding the private equity industry. “I think it’s a scam personally” Cooperman […]

  • Apple’s Cheapest iPad: A Better Deal than Competitors?
    Market Realist

    Apple’s Cheapest iPad: A Better Deal than Competitors?

    In terms of pricing, Apple’s seventh-generation iPad is a reasonable proposition compared to its predecessor. Now let’s see how it fares against its peers.

  • Broadcom Stock: Why Is It Falling Today?
    Market Realist

    Broadcom Stock: Why Is It Falling Today?

    Broadcom stock hasn't been a great performer compared to its semiconductor peers this year. So far, the stock has fallen more than 4% today.

  • Zumiez, Vista Outdoor, GameStop, Microsoft and Sony highlighted as Zacks Bull and Bear of the Day

    Zumiez, Vista Outdoor, GameStop, Microsoft and Sony highlighted as Zacks Bull and Bear of the Day

    Zumiez, Vista Outdoor, GameStop, Microsoft and Sony highlighted as Zacks Bull and Bear of the Day

  • New Highs for AMZN Stock Will Come After Growth Challenges End

    New Highs for AMZN Stock Will Come After Growth Challenges End

    Over the past decade, Wall Street has witnessed the meteoric rise of Amazon (NASDAQ:AMZN). With a market cap of about $910 billion, AMZN stock is now one of the largest publicly listed companies. In the U.S. as well as in many other countries, it is the dominant online retailer. In recent years, Amazon has also expanded into other growth areas such as cloud computing where it has already become a leader.Source: Jonathan Weiss / Shutterstock.com However, since early July, long-term AMZN shareholders have been somewhat concerned with the stock's price action. On July 11, Amazon stock hit an 52-week high of $2035.80. On Aug. 26, it saw a recent low of $1743.51. Currently the Amazon stock price is hovering around $1850.Now many investors are wondering if this quarter AMZN stock goes and stays over $2000, a price that has become an important resistance level.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Discount Retail Stocks to Buy for a Recession Until its next earnings report on Oct. 24, I expect AMZN to stay range-bound, possibly between $1750 and $1900. In other words, Amazon stock would need to show strong Q3 financial numbers that would act as catalyst to push the stock over $2,000 again. Here is why. Amazon Stock's Unimpressive Q2 EarningsIn July, when Amazon reported earnings for its second fiscal quarter of 2019 , it missed on the bottom line as it warned profits would disappoint in Q3, too. Amazon stock's EPS in the quarter was $5.22, compared to the forecast EPS of $5.56.The retail giant beat analysts' average revenue estimate by a small amount. Its Q2 revenue came at $63.4 billion. Wall Street was looking for $62.5 billion. In Q2 2018, Amazon had posted $52.9 billion in sales.Amazon stock's revenue comes from five main segments: * Retail Products (about 65% of its revenues) * Retail Third-Party Sellers (about 12% of its revenues) * Amazon Web Services, or AWS (about 15% of its revenues) * Subscriptions such as Amazon Prime (about 5% of its revenues) * Other, such as credit card agreements and advertising (about 3% of its revenues)During the quarter, Amazon's U.S. sales increased by 17% to $35.8 billion. The group's international sales grew by 9% to $16.2 billion.Amazon stock's AWS segment is the growth driver operating at high margins. The group especially uses the cash generated from AWS to fund the growth in other segments.Wall Street noted that Subscriptions, which mainly constitute Amazon Prime members, were up 37% to $4.7 billion.Investors noted that the group's renewed investments into the company are paying off as sales increased. However, this sales growth is coming at the expense of lower profit margins.Since the release of the quarterly results, investors have decreased growth expectations for the coming months, as partly reflected by the sharp drop in the AMZN stock price. Wall Street Needs to See Revenue Growth in AMZN StockNot only has Amazon stock changed the world of e-commerce, but the company has been disrupting how consumer shop overall. Yet, these earnings results show that the revenue growth of Amazon's online store, third-party sellers, and subscriptions has been decelerating.Furthermore, AWS, or Amazon's cloud business, reported its slowest growth rate in several years. Its AWS revenue hit $8.4 billion. However, the consensus estimate was for $8.5 billion. In Q2 2018, the unit revenue had been $6.1 billion. Investors were especially concerned that the growth in AWS is not offsetting the top-line declines of other segments.Over the past few years, revenue and operating profits of AWS have grown extremely quickly. However, its mouth-watering operating margins have also attracted serious competition from other tech giants.Microsoft's (NASDAQ:MSFT) Azure, Alphabet's (NASDAQ:GOOG, NASDAQ:GOOGL) Google Cloud, and Alibaba's (NYSE:BABA) cloud operations have become important competitors.Going forward, Amazon expects its investments to increase, another factor that will negatively affect its bottom line and potentially Amazon stock in the near future. The company is expected to invest heavily in its advertising business, Prime Video, international growth, shipping, and logistics.When the company releases Q3 earnings in late October, analysts will be paying attention to the various growth metrics that Amazon reports. Management gave Q3 net sales guidance to be between $66-$70 billion. This guidance would mean a growth of between 17% and 24% compared with third-quarter 2018.To me, earnings results in the past few quarters show that AMZN stock is becoming increasingly dependent on AWS for revenue growth. Therefore, in Q3 I would be interested to see the metrics for each segment. Is It Time to Buy Amazon Stock Now?If you are wondering whether you should buy Amazon stock right now, the answer depends on your evaluation of Amazon's fundamentals and on your investing time horizon.In the coming weeks, I expect AMZN stock to trade in a range between $1,750 and $1,900. If Amazon stock stays above the $1,820 level, it is likely to test $1,900 and above soon.Year-to-date AMZN share price is up over 21%. If you already own AMZN stock, you might want to hold onto your shares. However, within the parameters of your portfolio allocation and risk/return profile, you may consider placing a stop loss about 3%-5% below the current price point, especially if you want to protect your paper profits.AMZN is a is a high beta stock at 1.55. The stock market has a beta of 1.0. Therefore Amazon stock's beta measures its volatility in relation to the market. In other words, in general, AMZN stock rises more than the market in bullish conditions and decreases more when markets are falling. Short-term traders should exercise caution if they want to participate in Amazon stock's wide daily swings.Patient investors who continue to believe in AMZN may see any price dip towards or below the $1,750 level as an opportunity to go long AMZN stock and ride out its daily volatility.Amazon stock will need to stabilize and build a base again before it can deliver a long-term, sustained rally that would take the shares over $2,000. The Bottom Line on AMZN StockWhen Amazon next reports its Q3 results in October, investors will scrutinize the company's fundamentals. If the results show that the company's growth has slowed further, investors may decide that Amazon is now a maturing company. As a result, they may think that the current valuation of Amazon stock is excessive.Nonetheless, it is important to remember that a mega-company with fundamentals as robust as Amazon's could withstand several months of uncertainty. And, eventually, AMZN's management will make decisions that will move the company forward.On Sep. 25, Amazon will be holding its next hardware event. Wall Street would be looking to see what Alexa-enabled products may be introduced in the coming months.Management also continues to invest heavily in original video content development and online streaming services. I'd also continue to observe that space for its potential effect on AMZN stock revenue.In two to three years, I expect AMZN stock investors to be rewarded handsomely. Eventually, fundamental catalysts will drive Amazon stock higher, and the stock price will rise above $2,000 again.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 * 10 Big IPO Stocks From 2019 to Watch * 7 Discount Retail Stocks to Buy for a Recession * 7 Stocks to Buy Benefiting From Millennial Money The post New Highs for AMZN Stock Will Come After Growth Challenges End appeared first on InvestorPlace.

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