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Global Stocks Trending in the News for March 15th, 2019

Mar 15, 2019

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Global Consumer Stocks Trending in the News

  • BMW AG (DB:BMW) Oracle reported a 7.9% drop in ebit to 9.12 billion euros.  BMW declared a full year dividend of 3.50 euros per shares, below the 3.86 consensus.  BMW’s CEO said the coming year is full of significant challenges for BMW, the company will shrink its lineup to deal with these challenges.  BMW sees a slight rise in deliveries in 2019.  BMW AG is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.
  • Casino (ENXTPA:CO) announced it has increased its asset disposal plan to at least 2.5 billion euros by the first quarter of 2020.  Casino completed it original 1.5 billion euro plan ahead of schedule and said it received additional indications of interest that led it to increase the size of the plan. Casino guided it looks to open 300 premium and convenience stores by 2021 and increase e-commerce sales to 30% of sales in 2021 up from 18% today.  Casino is rated “Unattractive” in our European SMID-Cap Global Top Stock Ideas.
  • Dollar General (DG) reported fourth quarter EPS of USD$1.84 just a touch below USD$1.88 consensus.  Dollar General reported same store sales growth of 4% beating consensus of 2.6%.  Its quarterly dividend was hiked to 31 cents per share from 29 cents.  Dollar General gave fiscal 2019 EPS guidance of USD$6.30-6.50, below consensus of USD$6.65.  Dollar General is rated “Top Buy” in our US Large-Cap and “Top Buy” in our US Consumer Discretionary Global Top Stock Ideas.
  • Tenneco (TEN) shares slide by double-digits after the company announced CY4Q2018 earnings that missed analyst estimates. Tenneco reported an adjusted EPS of USD$1.30 in CY4Q2018 while consensus called for USD$1.41. Tenneco also announced revenue of USD$4.27bn in CY4Q2018, edging past consensus of USD$4.28bn. Tenneco is rated “Attractive” in our US SMID-Cap and “Neutral” in our US Consumer Discretionary Global Top Stock Ideas.
  • Volkswagen (XTRA:VOW3) increased its electric vehicle (EV) sales guidance by 50%.  On March 12th Volkswagen said it will launch 70 EV models and produce 22 million vehicles by 2028, up from 50 models and 15 million vehicles from its previous guidance.  For comparison, Volkswagen sold 80,000 EVs in 2018.  Volkswagen is rated “Neutral” in our European Large-Cap Global Top Stock Ideas.

Global Information Technology & Communication Services Stocks Trending in the News

  • Adobe (ADBE) Oracle reported fiscal first quarter 2019 EPS of USD$1.71 beating consensus of USD$1.62.  Oracle reported fiscal first quarter 2019 revenue of USD$2.60 billion beating consensus of USD$2.55 billion.  Adobe gave second quarter EPS guidance of around USD$1.77.  Adobe is rated “Attractive” in our US Large-Cap and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Apple (AAPL) was rated buy at Cowen in its initiation report on the stock.  Apple’s growth in services should propel it higher, with that unit being described as “an annuity.”   While acknowledging there exist challenges around its mature iPhone business Cowen sees many opportunities to grow revenue with value-added services.  Apple is rated “Neutral” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • AT&T’s (T) is hiking the price of its TV service for the second time since January.  AT&T told a judge that prices would fall if it were allowed to buy Time Warner during an antitrust case last year.  But here were are with prices rising again, with many critics complaining that regulators are not protecting customers.  AT&T is rated “Unattractive” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas.
  • Cloudera Inc. (CLDR) shares fell intraday by the most in nearly a year after the company announced guidance for a loss and weaker-than-expected sales in its next fiscal year. Cloudera told investors that it expects FY2020 revenue between USD$835mm and USD$855mm and a loss per share of between USD$0.32 and USD$0.36. Cloudera Inc. is rated “Unattractive” in our US Large-Cap and “Top Short” in our US Information Technology Global Top Stock Ideas.
  • Facebook (FB) suffered large-scale outages for its Facebook and Instagram networks yesterday, with users unable to use the site for up to 11 hours in various regions of the world. Sporadic outages still appear to be happening but mostly the site seems to be back to normal.  Facebook has already mentioned the possibility of refunding advertisers whose advertisement that were paid for were never broadcast.  It is very unusual for such a mature site to be down so long.  Facebook is rated “Neutral” in our US Large-Cap and “Attractive” in our US Information Technology Global Top Stock Ideas.
  • Micron (MU) was downgraded at Cross Research to hold from buy.  Merill Lynch maintains its buy rating and USD$50 price target but warns of falling selling prices in the second quarter of 2019.  This is expected to be temporary with a turnaround coming by the fourth quarter.  Micron is rated “Unattractive” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Microsoft (MSFT) announced it is working with Oxford Biomedica Plc (LSE:OXB) on developing better ways to repair genes in those with life-threatening diseases.  Microsoft will contribute its Azure cloud and machine learning software to help Oxford increase the productivity and purity of the viruses it uses in the repair of malformed genes.  The initial collaboration is for 2 years with the option to extend it.  Microsoft is rated “Neutral” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas.  Oxford Biomedica Plc is not rated in our Global Top Stock Ideas.
  • MongoDB Inc. (MDB) shares spiked to record levels after the company announced a far better-than-expected revenue outlook. The guidance initiated a slew of price target hikes, upgrades, and bullish commentary from analysts at Morgan Stanley, Rosenblatt Securities, and other Wall Street firms. Shares traded as much as 28% higher on the news while the stock is now 80% higher from its January low. MongoDB is rated “Neutral” in our US Large-Cap and “Unattractive” in our US Information Technology Global Top Stock Ideas.
  • Oracle (ORCL) reported fiscal third quarter 2019 EPS of 87 cents beating consensus of 84 cents.  Oracle reported fiscal third quarter 2019 revenue of USD$9.62 billion in line with consensus of USD$9.59 billion.  Oracle increased its quarterly dividend to 24 cents per share from 19 cents.  Oracle is rated “Neutral” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Snap Inc. (SNAP) shares surged to their highest levels since September 2018 after BTIG announced a Street-high price target of USD$15/share. In a note to clients, BTIG analyst Rich Greenfield wrote, “Virtually everything that could go wrong for Snapchat over the past couple years since going public has gone wrong.” Greenfield believes that overseas advertisers will take advantage of Snap Inc.’s relatively low bid prices for ad inventory in the US, driving a stronger FY2019 than the previous year. Snap Inc. is rated “Top Short” in our US Large-Cap and “Unattractive” in our US Information Technology Global Top Stock Ideas.
  • Spotify’s (SPOT) CEO commented today his company has suffered greatly from the restrictions Spotify alleges Apple has placed on it.  These alleged restrictions are the reason Spotify complained to the EU, demanding an investigation of Apple’s business practices.  He added that one of the biggest complaints from customers is their inability to get Spotify to work on Apple’s products.  The EU antitrust regulator said it would take the complaint seriously.  Spotify is not rated in our Global Top Stock Ideas.  Apple is rated “Neutral” in our US Large-Cap and “Neutral” in our US Information Technology Global Top Stock Ideas.
  • Take Two Interactive Software (TTWO) shares spiked on Wednesday following rumors that the company’s board is in high-level talks to be acquired by Sony Interactive Entertainment (TSE: 6758). Sony has since rebuked rumors with spokesman Hirotaka Fukushima saying on the phone that there is, “no truth,” behind the reports. Take Two is rated “Attractive” in our US Large-Cap and “Top Buy” in our US Information Technology Global Top Stock Ideas. Sony is rated “Attractive” in our Japan Large-Cap Global Top Stock Ideas.

 

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We Crunch the Numbers, You Make the Trade.We Crunch the Numbers, You Make the Trade.

 

Global Financials Stocks Trending in the News

  • Brookfield Asset Management Inc. (TSX: BAM.A) has agreed to purchase a majority stake in Oaktree Capital Group LLC (OAK), a combination that will rival Blackstone Group LP (OAK) as the world’s largest alternative asset manager. Brookfield will pay USD$4.7bn for a ~62% stake in Oaktree Capital Group. Combined, the firms will have roughly USD$475bn of assets under management that generates about USD$2.5bn of fee-related revenue. Brookfield Asset Management is rated “Unattractive” in our Canada All-Cap Global Top Stock Ideas. Oaktree Capital Group is rated “Attractive” in our US SMID-Cap Global Top Stock Ideas.  Blackstone Group LP is rated “Unattractive” in our US SMID-Cap Global Top Stock Ideas.
  • Commerzbank’s (DB:CBK) potential merger with Deutsche Bank (DB:DBK) is opposed by the top employee representative at Commerzbank.  The deputy chairman of the board at Commerzbank made the comment about how the workers’ council at the bank is opposed to any merger.  Earlier in the week labor leaders at Deutsche Bank expressed the same opposition to any merger with Commerzbank.   Commerzbank is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.  Deutsche Bank is rated “Unattractive” in our European Large-Cap Global Top Stock Ideas.

Global Industrials Stocks Trending in the News

  • Air Canada (TSX:A C) has suspended financial guidance for the coming quarter and full year given the grounding of the 737 Max jets.  Air Canada said it is devising a contingency plan for the loss of the jets but does not have anything to announce yet.  Macquarie is recommending clients use the weakness in the stock as a buying opportunity.  Air Canada is rated “Attractive” in our Canada All-Cap Global Top Stock Ideas. 
  • Boeing (BA) has seen all of its 737 Mac aircraft around the world grounded.  It has USD$600 billion in a backlog of orders for the model and buyers are already suggesting they may cancel and opt for Airbus (AIR) models instead.  There have not been any cancelations yet, though a number of buyers have expressed the potential for canceling.    Boeing is rated “Attractive” in our US Large-Cap and “Neutral” in our US Industrials Global Top Stock Ideas.
  • Embraer (ERJ) reported fourth quarter revenue of USD$1.67 billion, matching consensus; with ebitda of USD$1.8.1 million.  Embraer reaffirmed 2019 guidance and said 2019 will be a year of operational break-even.  Embraer added that Boeing’s (BA) problems with the 737 Max will not affect Embaer’s JV with Boeing.  Embaer is rated “Unattractive” in our Brazil All-Cap Global Top Stock Ideas.  Boeing is rated “Attractive” in our US Large-Cap and “Neutral” in our US Industrials Global Top Stock Ideas.
  • Equifax (EFX) was initiated at Exane BNP Paribas with a neutral.  Equifax saw its price target set at USD$106.  The average price target in the market is USD$117.64 presently.   S&P downgraded Equifax’s credit rating to BBB- with a negative outlook saying its revenues will continue to be pressured by one-time costs and investment spending.  Equifax is rated “Neutral” in our US Large-Cap and “Unattractive” in our US Industrials Global Top Stock Ideas.
  • General Electric (GE) said it will burn through USD$2 billion in cash over the coming year as it works to turnaround the company.  CEO Larry Culp said the “Challenges are complex but clear” and highlighted that performance in 2020 and 2021 will be noticeably better than 2019.  GE has seen USD$170 billion in market cap evaporate since its problems started.  General Electric is rated “Neutral” in our US Large-Cap and “Unattractive” in our US Industrials Global Top Stock Ideas.

Global Commodities & Power Stocks Trending in the News

  • ExxonMobil (XOM) said today it intends to lower the cost of pumping oil in the Permian Basin to USD$15 per barrel.  For comparison, that is a low cost that can only be found in the huge fields of the Middle East.  The Permian Basin total production is close to 4 million barrels per day, equal to all the production in Iraq today.  ExxonMobil is deploying 55 rigs there by 2024 and total production there is expected to double by that time.  ExxonMobil is rated “Unattractive” in our US Large-Cap Global Top Stock Ideas.
  • K+S AG (DB: SDF) shares soared after the company forecasted an earnings surge in FY2019 following a 110mm euro loss in profit in FY2018 due to an inability to dispose process water into German rivers because of a drought. K+S sees operating profit growing by as much as 40% in FY2019 to as high as 850mm euros. K+S is rated “Unattractive” in our European SMID-Cap Global Top Stock Ideas.
  • Legacy Reserves Inc. (LGCY) shares tanked after the company announced that it is reviewing all strategic options, including a sale. Legacy Reserves has reached out to Tudor Pickering & Hold L.P. and Perella Weinberg Partners L.P. as financial advisors for its next strategic choice. Legacy Reserves is rated “Unattractive” in our US SMID-Cap Global Top Stock Ideas.

Global Healthcare Stocks Trending in the News

  • BioScrip (BIOS) and Option Care Enterprises have agreed to merge in an all stock transaction.  Upon completion, the resulting company will be 80% owned by investment funds that are affiliated with Madison Dearborn Partners and Walgreens Boots Alliance (WBA).  The company will remain listed in Nasdaq.  Bioscrip is rated “Attractive” in our US SMID-Cap Global Top Stock Ideas.  Walgreens Boots Alliance is rated “Attractive” in our US Large-Cap and “Neutral” in our US Consumer Staples Global Top Stock Ideas.

 

Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS
Global Top Stock IdeasTOP LONG & TOP SHORT STOCK IDEAS FOR GLOBAL MARKETSMONTHLY TOP IDEAS FROM OUR MULTI-FACTOR QUANTITATIVE MODELS