Risk/Reward archive
On Thursday (2/21), Brightcove (BCOV) reported somewhat disappointing 2019 fourth quarter performance and guidance which caused its stock to plummet 12.8% on the open and end the day down 7.2% (from the previous close). Yet, buyers emerged quickly…
Continue reading →2019 was a solid year for U.S. housing. While still subject to modest revisions, government figures show that new residential sales increased 10.4% from an estimated 617,000 units in 2018 to 681,000 units in 2019. Single-family housing starts…
Continue reading →Under new CEO Steve Westhoven, the business portfolio of New Jersey Resources (NJR) has evolved as it typically does in response to changes in its operating environment. Its regulated utility operations, New Jersey Natural Gas (NJNG) and its…
Continue reading →A key change at Brightcove since my last post has been the turnover at the top. In August 2017, after three consecutive quarters of earnings misses, Dave Mendels, who had served as CEO for more than four years,…
Continue reading →Homebuilding stocks have been the best performing of the 150-odd sectors in the Dow Jones U.S. Total Market Index, up 44.4% over the past 12 months as of November 8. Last year, they declined sharply in the face…
Continue reading →At its 2019 Securities Analyst meeting (SAM) held in New York City on October 23, the senior management of Hewlett Packard Enterprise (HPE) said that the company was poised to enter the third phase of its evolution: pivoting…
Continue reading →SNH has set a goal of $900 million in announced or closed asset sales in 2019. With more than nine months of the year gone, it has completed only $119.1 million in asset sales and has an estimated…
Continue reading →The five publicly-traded REITs that are managed by the RMR Group, Inc. (RMR), a Newton, Mass.-based property manager, have often traded at significant discounts to their peers. The discount has been attributed to the nature of the relationship…
Continue reading →The cover story in this week’s Sunday New York Times Magazine is “What Really Caused the Deadly Crashes of the Boeing 737 Max?“. While acknowledging that malfunctions caused the crashes, it also documents in detail the errors made…
Continue reading →On August 15, 2019, Harry Markopolos, who gained fame as the person who exposed the fraud perpetrated by Bernie Madoff, released a 175-page report entitled “General Electric, A Bigger Fraud Than Enron.” GE’s stock fell 11.3% on the…
Continue reading →In response to the financial difficulties of its primary tenant, Five Star Senior Living (FVE), Senior Housing Properties Trust (SNH) has been forced to negotiate a change in the structure of their business relationship. Specifically, SNH has agreed…
Continue reading →Five Star Senior Living (FVE) and its landlord Senior Housing Properties Trust (SNH) have previously announced a restructuring of their commercial arrangements whereby SNH will cancel the five master leases that cover 181 senior living and skilled nursing…
Continue reading →A typical analysis from policy makers, like the Federal Reserve, points out that activity in the housing market has declined so far this year; but that assertion focuses primarily on housing starts. A more complete picture from the…
Continue reading →On June 20, Merck held an investor day, its first in five years, to highlight its goals and objectives and provide a broad perspective on its five-year performance outlook. Although its blockbuster cancer treatment, KEYTRUDA (pembrolizumab), has been…
Continue reading →Shares of Bluegreen Vacations Corporation (BXG) received a double whammy in May from the parent company BBX Capital’s (BBX) decision to back out of its offer to buyback BXG’s public float – equal to 10% of outstanding shares…
Continue reading →As anticipated, the market for new single-family houses rebounded from a steep 2018 fourth quarter slide to post modest gains in the 2019 first quarter against fairly strong 2018 first quarter levels. The primary driver of the housing…
Continue reading →The net income and EPS figures for the 2019 first quarter for Baker Hughes, a GE company, are confusing as presented. The company reported net income (before income or loss allocated to the non-controlling interest, which is GE)…
Continue reading →AT&T reported diluted EPS of $0.56 per share, down from $0.75 a year ago. Non-GAAP adjusted EPS of $0.86 per share was up slightly from $0.85 last year and in line with consensus estimates. The difference between GAAP…
Continue reading →Arch reported 18Q1 diluted EPS of $3.91, up from $2.75 in 17Q1 and well ahead of the consensus estimate of $2.71. The gain in earnings came despite a 3.5% decline in revenues to $555.2 million, primarily because of…
Continue reading →The company reported diluted EPS of $0.24 per share, up from $0.21 a year ago. Sales declined 1% to $31.4 million due mostly to a non-repeat of a large order from a distributor who was launching a first…
Continue reading →Earnings of $1.80 per share included a $0.21 charge related to merchant fees litigation. Excluding that charge, AXP’s 2019 first quarter EPS would have been $2.01, up from $1.86 a year ago and in line with market expectations. …
Continue reading →After reporting a 2018 fourth quarter loss of $23 million, negative EBITDA for the quarter of $12.5 million and a $51 million drawdown on its bank credit facility, it is clear that Five Star, SNH’s largest tenant, must…
Continue reading →The outlook for housing (or more precisely, sentiment about the outlook for housing) has improved in recent weeks, primarily because of the decline in mortgage rates. The average rate on the 30-year mortgage has fallen by 57 basis…
Continue reading →General Electric (GE) posted 2018 fourth quarter results that were viewed positively by the financial community primarily because there were no new major negative surprises. Although management gave an update on the company’s recent progress and certain aspects…
Continue reading →American Water Works Company (AWK) has delivered superior operating, financial and stock price performance over the past eight years. Its 2018 performance did not match the eight year average in either absolute or relative terms. However, management is…
Continue reading →2018 was a rough year for investors in Acme United Corporation’s (ACU) stock, including CEO Walter Johnsen who owns 15% of the outstanding shares. ACU’s 2018 total return was -38%, worse than the Zack’s Micro Cap Index’s 17%…
Continue reading →Despite progress recorded in both its restructuring and its financial performance, HPE's shares underperformed the market. Several factors contributed to the underperformance; but the shares should have upside if the company can deliver on its guidance.
Continue reading →SJI's stock has underperformed peers due in part to disappointing guidance for 2018 given at its recent analyst meeting. However, if management is able to deliver on its 2019 guidance, the stock should have reasonable upside, especially since…
Continue reading →As a result of recent operating losses, Five Star Senior Living faces a restructuring with its landlord, Senior Housing Properties Trust.
Continue reading →It has certainly been a rough year for homebuilding stocks, but not nearly so bad for the housing market. The Lark Research Homebuilder Stock Price Index, an equal weighted average of eleven publicly-traded homebuilder stocks, was down 29.2%…
Continue reading →Since floating the IPO in November 2017, Bluegreen Vacations Corporation’s (BXG) share price has come full circle. The stock opened its first day of trading at $13.55, rallied to a high of $25.91 in July and has since…
Continue reading →General Electric (GE) reported 2018 third quarter results on Tuesday, October 30. This was the first conference call for newly-installed Chairman and CEO H. Lawrence (Larry) Culp, Jr.
Continue reading →On May 18, 2018, in conjunction with the release of fiscal 2018 third quarter earnings report, Campbell Soup Company (CPB) announced a “CEO transition.” Denise M. Morrison, who had served as Campbell’s President and CEO since August 2011,…
Continue reading →AT&T completed its acquisition of Time Warner on June 14, 2018. Under the merger agreement, Time Warner shareholders received $53.75 per share in cash and 1.437 shares of AT&T stock for each TWX share held. In total, Time…
Continue reading →2018 has been rough for homebuilding stocks. The Lark Research Homebuilder Stock Index, which is an equal-weighted measure of the price performance of ten publicly-traded homebuilders, was down 19.9% year-to-date through August 3rd, far worse than the gains…
Continue reading →Besides the recent weakness at Power and Oil & Gas, GE has been grappling with legacy issues at GE Capital. Although it has been downsizing for more than a decade now – reducing its assets from $660 billion…
Continue reading →On June 26, General Electric (GE) announced the outcome of its strategic review. Besides divestiture actions already announced, the company said that it will spin-off its Healthcare business over the next 12-18 months and distribute its 62.5% stake…
Continue reading →General Electric reported disappointing 2018 second quarter GAAP earnings attributable to shareholders of $736 million or $0.07 per share, down 30% from $1.03 billion or $0.10 per share last year. Adjusted (Non-GAAP) EPS, according to the company’s definition,…
Continue reading →2018 First Quarter Results. On April 26, Arch Coal reported disappointing 2018 first quarter results. Adjusted EPS for the quarter was $2.95, up from $2.82 last year, but behind the consensus forecast of $4.22. Revenues declined 4.3% to…
Continue reading →Pressure from Declining Occupancy; But SNH Has Sufficient Financial Flexibility to Cope for Next Two Years or More.
Continue reading →CWCO reported first quarter net earnings attributable to stockholders $2.1 million or $0.14 cents per diluted share. That compares with 17Q1 net income of $2.6 million or $0.18 per diluted share. Revenues declined 2.2% to $15.7 million.
Continue reading →GAAP loss of $1.18 billion or $0.14 per share vs. a 17Q1 loss of $0.12 billion or $0.01 per share. This quarter’s loss included a $1.55 billion ($0.17 per share) charge representing the estimated cost of settling potential…
Continue reading →On Friday (4/13), General Electric (GE) filed an 8-K that quantified the impact of adopting new accounting standards (and certain voluntary changes in accounting policies) on its previously reported results for 2016 and 2017. In total, these changes…
Continue reading →On March 6, Bluegreen Vacations (BXG) reported 2017 fourth quarter net earnings attributable to shareholders of $66.5 million or $0.93 per diluted share, compared with $25.6 million or $0.36 per share in the prior year quarter.
Continue reading →Bluegreen Vacations (BXG) completed its IPO in November 2017. The company had been wholly-owned by BBX Capital (BBX). In the IPO, Bluegreen offered a total of 7.47 million shares (including, with the overallotment option, 3.74 million shares owned…
Continue reading →GE announced this morning that it will take an after-tax charge of $6.2 billion in the 2017 fourth quarter against the value of GE Capital’s run-off insurance portfolio, North American Life & Health (NALH). In addition, GE Capital…
Continue reading →Affordable Housing. According to U.S. News and World Report, Massachusetts ranks as the best state in the nation in 2017, with top 5 scores in education, health care and economy. All around the state, there has been a…
Continue reading →The Massachusetts economy is experiencing its most robust expansion since the late 1980s. Third quarter GDP growth was clocked at 5.9%, according to Mass Benchmarks. Leading indicators anticipate 2017 fourth quarter GDP growth of 3.3% and 2018 first…
Continue reading →“You can’t grow long-term if you can’t eat short-term. Anybody can manage short. Anybody can manage long. Balancing those two things is what management is” -Jack Welch As everyone knows, this has been a tough year for…
Continue reading →Key takeaways: Through its HPE Next transformation plan, HPE will spend $1.1 billion over the next two years to achieve annualized cost cuts of $1.5 billion by the end of 2020. It will reinvest about half of the…
Continue reading →Ken Chennault announces retirement in February 2018 and Steve Squeri will become Chairman & CEO Third Quarter EPS of $1.50 vs. $1.20 last year and consensus of $1.48 Management raised full year 2017 guidance from $5.40-$5.80 to $5.80-$5.90…
Continue reading →On Friday (10/6), after the market close, General Electric (GE) announced that three of its senior executives, all Vice Chairs – John Rice, CEO of GE’s Global Growth Operations, Beth Comstock, CEO of GE’s Business Innovations and Jeff…
Continue reading →Imperial Oil (IMO), in which Exxon Mobil Corp. has a 69.6% stake, is the largest integrated oil company in Canada. Across the value chain, it is a leading producer of oil (primarily through its assets in the Athabasca…
Continue reading →Since it was spun off from Hewlett-Packard Company in November 2015, Hewlett Packard Enterprise Company (HPE) has made several important strategic moves to remake its business.
Continue reading →Baker Hughes and General Electric completed their merger on July 3, 2017. Baker Hughes shareholders received $17.50 in cash and one share of new Baker Hughes stock (BHGE).
Continue reading →Shares of Five Star Senior Living (FVE) have performed poorly over the past two years, even underperforming FVE’s peer group, which has significantly underperformed both the health care sector and the broader market. The industry is suffering from…
Continue reading →Although the Greek economy looked like it was beginning to achieve liftoff in late 2014, its progress was set back in early 2015 by the newly-installed Tsipras administration’s effort to obtain major changes to the country’s bailout program.…
Continue reading →Public Service Enterprise Group (PSEG) is a public utility holding company whose principal direct operating subsidiaries include Public Service Electric & Gas (PSE&G), which serves 2.2 million electric customers and 1.8 million gas customers along a northeast to…
Continue reading →Arch Coal emerged from bankruptcy on October 5, 2016 and recently filed its 2016 10-K which included its fourth quarter performance (Oct. 2 to Dec. 31) as a reorganized (i.e. successor) company. With its quick emergence from Chapter…
Continue reading →UPS held an investor day in New York City on February 22, three weeks after reporting disappointing fourth quarter results. Its stock fell sharply on the earnings news, giving back all of its Trump rally gains. So far…
Continue reading →The Massachusetts Water Resources Authority (MWRA) was created by the Massachusetts Water Resources Authority Act, Chapter 372 of the Acts of 1984 of the Commonwealth of Massachusetts. Its operating territory covers 61 communities (i.e. cities, towns and special…
Continue reading →The Massachusetts Bay Transportation Authority (MBTA or the Authority) is a body politic and corporate and a political subdivision of the Commonwealth of Massachusetts. It is also a component of the Massachusetts Department of Transportation. Created in 1964,…
Continue reading →The Conference was held on December 7, 2016.
Continue reading →Shares of Consolidated Water (CWCO) have struggled over the past several months, extending a period of underperformance vs. peers that stretches back for more than a year. Year-to-date (through 12/9), CWCO has posted a loss (including dividends) of…
Continue reading →On October 5, Arch Coal officially exited the bankruptcy process. The exit came just short of nine months after it had filed for bankruptcy on January 11, 2016. This was a remarkable achievement, given the company’s size, the…
Continue reading →Tenaris S.A. (TS) is one of the world’s leading manufacturers of seamless and welded steel casing and tubing, otherwise known as “oil country tubular goods.” Its products are used mostly in oil & gas drilling operations.
Continue reading →On July 6, the bankruptcy court approved Arch Coal’s Third Amended Bankruptcy Plan and Disclosure Statement. That set in motion the voting process which is scheduled to end on August 31. If there are no hitches and creditors…
Continue reading →The Dow Jones U.S. Coal Mining Sector Index has more than doubled so far this year, up 117.6% through July 15, obviously much better than the broader DJ US Total Market Index’s gain of 5.7%. Much of coal’s gains…
Continue reading →PayPal’s stock has underperformed the broader market since reaching a new high of $41.75 on March 22. The stock bottomed at $34.00 on June 27 and has since bounced back to close at $38.15 today. Year-to-date, the stock…
Continue reading →Very few industries have suffered a decline as steep as coal’s. In just five years, the coal industry has gone from relatively healthy to almost entirely bankrupt. Major coal producers – including Peabody Energy, Arch Coal, and Alpha…
Continue reading →Arch Coal, the second largest U.S. coal producer, is another casualty of the sharp decline in coal consumption. After a steady slide in its business that began in 2011 and accelerated when oil and natural gas prices plunged…
Continue reading →Product Pipeline Successes. Merck has enjoyed a couple of notable successes in its product pipeline over the past year. The first and most important is Keytruda (pembrolizumab), the company’s anti-PD-1 (programmed death receptor-1) immunotherapy treatment for cancer. Keytruda…
Continue reading →Shareholders of the American Express Company have had a pretty rough ride over the past few years. Since 2013, when AXP’s stock earned nearly twice the S&P 500, the stock has underperformed the broader market significantly
Continue reading →Greece’s quest to pass the next milestone on it bailout plan will get a hearing on Monday in Brussels at a meeting of EU finance ministers. Press reports suggest that the EU and IMF are still looking for about…
Continue reading →This has been an eventful year for General Electric (GE), one that brought about the most significant changes that the company has seen in its 127 year history. The company has repositioned its business mix, drastically reducing its…
Continue reading →2015 has been another strong year for the stock of American Water Works (AWK). Year-to-date (through Dec. 18), it is up 11.7% on price and has delivered a 14.5% total return. By comparison, the S&P 500 is down…
Continue reading →Although the recovery in the Eurozone is underway, Greece has so far been left behind. Europe is growing now at an overall rate of 2% per year. Even the other peripheral countries that had been experiencing difficulties– Ireland,…
Continue reading →Author’s Note: Municipal bonds have been on my radar for some time, even though my focus has been on stocks and corporate bonds. I have attended the Massachusetts Investor Conference for the past four years, as a way to…
Continue reading →Campbell Soup (CPB) reported fiscal 2016 first quarter GAAP earnings of $0.62 per diluted share, compared with $0.78 in the comparable prior year period. Excluding special items, the company’s non-GAAP earnings were $0.95, compared with $0.78 last year.
Continue reading →Consolidated Water (CWCO) reported 2015 third quarter earnings of $0.12 per share, compared with $0.13 per share in the prior year comparable quarter. Revenues of $14.6 million, were down 14% from $17.0 million last year. Both earnings and…
Continue reading →The company reported a third quarter GAAP loss of $0.04 per share, much better than last year’s $0.12 loss. Adjusted (non-GAAP) EPS, which excludes (non-cash) stock-based compensation and merger-related costs was positive at $0.03, a reversal of last…
Continue reading →Consolidated Water reported net income attributable to stockholders of $2.23 million or 15 cents per share for the 2015 second quarter ended June 30. This was below last year’s $2.76 million or $0.19 per share and also a…
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