Archive for December, 2020

• Merry Christmas
  Eddy Elfenbein, December 25th, 2020 at 7:18 am

  

  One of the most recognized statues in Manhattan, a 7,000-pound bronze “Charging Bull,” sculpted and owned by Arturo Di Modic stands on a sidewalk on lower Broadway near wall Street in New York City, December 21, 2004. The sculpture is for sale by Di Modica for a minimum bid of $5 million provided that the buyer keep the pavement-pawing statue where it stands in the financial district and donate it to the city of New York. REUTERS/Mike Segar

  I wanted to take this opportunity to wish everyone a Merry Christmas and a happy, healthy and profitable new year.

  This has been a challenging year for all of us. The coronavirus has upended our lives and brought a terrible toll. Fortunately, a vaccine is on its way and I hope our lives can soon get back to normal.

  We’ve also had our successes this year. The Buy List was up again in 2020. The blog continues to grow its readership. The newsletter now has a record number of subscribers and our Twitter following is growing as well.

  Our ETF turned four years old. I want to thank all our shareholders for their trust and confidence in me.

  I also want to thank my tireless editor, Marcia Hippen. She also posts the invaluable morning news links. I also want to acknowledge some of my fellow financial bloggers Barry Ritholtz, Josh Brown, Morgan Housel, Michael Batnick, Howard Lindzon, Tadas Viskanta, Jeff Miller and many, many others for their continued support.

  I’d also like to thank the people who follow and interact with me each day on Twitter.

  Most of all, I want to thank all of my readers for your continued support.

  Let’s hope 2021 brings us more success!

• Morning News: December 25, 2020
  Eddy Elfenbein, December 25th, 2020 at 7:02 am

  ‘Parting Is Such Sweet Sorrow’: EU and UK Clinch Narrow Brexit Accord

  Brexit Trade Deal Sparks Relief but UK Market Will Bear Scars

  Pelosi Sets New Vote as GOP Foils Move on Trump’s $2,000 Checks

  Benchmark 30-year Mortgage Rate Drops to Record Low 2.66%

  Small Donations Aiming to Make a Big Splash

  “DeJoy is the Real-Life Grinch”: Postmaster General’s Pre-Election Sabotage Fuels Christmas Delays

  ‘Stay Alive and Survive’: Ski Resorts Brace for a Pandemic Season

  Japan Considers Fines to Get Bars to Close Early Due to Virus

  ‘You Checked Tesla the Most’: Robinhood Recaps From a Volatile Year

  Musk Says It’s ‘Impossible’ to Take Tesla Private, Mulls New IPO

  The Plant-Based Meat Industry Has Grown Into A $20 Billion Business — But Challenges Remain

  ‘Wonder Woman’ Likely to Lasso More TV Viewers Than Theatergoers

  Howard Lindzon: More Howie Predictions – Loyalty Is Up For Review

  Be sure to follow me on Twitter.

• Light Trading on Christmas Eve
  Eddy Elfenbein, December 24th, 2020 at 10:50 am

  The stock market closes at 1 pm ET. Trading is pretty light today. There’s not much action going on. Trex (TREX) came within a few pennies of a new high. The stock is up 92% for us this year.

  In Washington, they’re fighting again over stimulus. Democrats want to send $2,000 checks but many Republicans want smaller checks.

  House Republicans on Thursday blocked a Democratic attempt to pass $2,000 direct payments to Americans, as the fate of the massive coronavirus relief package passed by Congress earlier in the week hangs in the balance.

  The Democrats moved to increase the size of the checks after President Donald Trump threatened to oppose the $2 trillion pandemic aid and federal funding bill because it included only $600 in direct payments rather than $2,000.

  Congress passed the proposal Monday after Trump took no role in weeks of talks. The plan included $900 billion in coronavirus relief.

• Morning News: December 24, 2020
  Eddy Elfenbein, December 24th, 2020 at 7:56 am

  On Cusp of Brexit Trade Deal, EU and UK Haggle Over Fish

  With Money, and Waste, China Fights for Chip Independence

  China Targets Jack Ma’s Alibaba Empire in Monopoly Probe

  The Year the Fed Changed Forever

  New Signs of Economic Distress Emerge as Trump Imperils Aid Deal

  Pandemic Prompts Wall Street to Look South for Florida’s Life and Work Benefits

  M&A Deals Come Roaring Back as Executives Plot Post-Covid Future

  How The Santa Claus Rally Could Predict January And 2021 Returns

  ‘What’s the Alternative?’ SolarWinds Boosts Security Firms’ Bottom Lines

  Poultry Farms in Apartment 13D Show Scale of Pandemic-Aid Fraud

  Ben Carlson: A Short History of Chasing The Best Performing Funds

  Michael Batnick: 3 Reasons Why You Shouldn’t Wait For the Stock Market to Crash

  Howard Lindzon: Howie’s 2021 Predictions…

  Joshua Brown: We Must Give More Relief To Americans For The Fake Virus I Said Would Disappear On Its Own & Interview With This Year’s Best Active Manager, Cathie Wood

  Be sure to follow me on Twitter.

• Jobless Claims Fall to 803,000
  Eddy Elfenbein, December 23rd, 2020 at 10:29 am

  The stock market is up again this morning, and the S&P 500 is back above 3,700. Today is a particularly good day for cyclical stocks. Many energy stocks are doing well as are many banks. At the other end, many tech stocks are lagging the market.

  On our Buy List, Check Point Software (CHKP) has been quite strong lately. I suppose that a massive government hack is good for business. Over Friday, Monday and Tuesday, the shares gained more than 11%.

  We also had some good news, finally, from the weekly jobless claims report. The number of Americans filing claims fell to 803,000. Economists had been expecting 888,000. The number for last week’s report was revised higher by 7,000 to 892,000.

  President Trump said that he wants Congress to revise the stimulus bill it just passed. The president said he wants to see larger checks and less wasteful items. This news blind-sided official Washington. If the president refuses to sign the bill, the government will shut down on December 29.

  

• Morning News: December 23, 2020
  Eddy Elfenbein, December 23rd, 2020 at 7:02 am

  Global Cargo Logjam Deepens, Delaying Goods Bound For Retailers, Automakers

  Pound’s Brexit Jolt Will Be Wilder Now That Liquidity Is Thin

  Investors Bet Weak Dollar Will Keep Risk Rally Going in 2021

  China-E.U. Talks Hit Another Snag as Biden Camp Objects

  There’s a Way Biden Can Raise More From the Rich Without Higher Taxes

  The Tech That Was Fixed in 2020 and the Tech That Still Needs Fixing

  How China Lost Patience With Jack Ma, Its Loudest Billionaire

  Facebook Support for Liability Reform Has Little Guys Nervous

  Walmart Sued Over Role It Played In Opioid Crisis

  Amazon to Face U.S. Union Push in Year Ahead

  Nick Maggiulli: Running Out of Time Before Running Out of Money

  Ben Carlson: Investing In Stocks At All-Time Highs

  Michael Batnick: Animal Spirits: Never Stop Buying Lottery Tickets

  Howard Lindzon: The SPAC Fantasy Stock Market

  Joshua Brown: Beat the Compound! A Simulated Stock Trading Game Coming in January! & The Big 2021 Surprise for Investors

  Be sure to follow me on Twitter.

• Q3 GDP Revised Slightly Higher
  Eddy Elfenbein, December 22nd, 2020 at 10:43 am

  This morning, the government released the final revision to Q3 GDP. The U.S. economy grew at a 33.4% annualized rate for the third quarter of the year. That’s a 0.3% increase over the previous estimate. That’s a very large number but it comes after the big drop during Q2.

  This morning’s existing-home-sales report saw a larger drop than expected.

  The National Association of Realtors said on Tuesday that existing home sales fell 2.5% to a seasonally adjusted annual rate of 6.69 million units last month. Economists polled by Reuters had forecast sales declining 1.0% to a rate of 6.70 million units in November.

  Existing home sales, which account for the bulk of U.S. home sales, surged 25.8% on a year-on-year basis in November.

  Congress also officially passed the stimulus bill. Here’s a chart of real GDP.

  

• Morning News: December 22, 2020
  Eddy Elfenbein, December 22nd, 2020 at 7:03 am

  Virus Disrupts Travel and Trade Between U.K and Europe

  Who Takes the Eurostar? Almost No One, as the Pandemic Fuels a Rail Crisis

  Europe’s Embattled Banks Look to Mergers as Way Out of Malaise

  Airbus to Lose Over $5 Billion in Orders Under AirAsia X’s Proposed Restructuring

  Massive Package of Virus Relief, Federal Funding Passes Congress

  Confusion Reigns As Companies, Industries Try to Navigate U.S. COVID-19 Vaccine Rollout

  Commercial Real Estate’s Pandemic Pain Is Only Just Beginning

  Covid Spurs Families to Shun Nursing Homes, a Shift That Appears Long Lasting

  Cryptos Dive As Ripple Expects To Be Sued by the SEC

  Apple Targets Car Production by 2024 and Eyes ‘Next Level’ Battery Technology

  Google and Facebook’s Antitrust Pileup: A Readers Guide

  SoftBank Just Filed for a $525 Million SPAC IPO. Here’s Why.

  Ben Carlson: What If You Only Invested at Market Peaks?

  Michael Batnick: This Is The Way

  Howard Lindzon: Extra Special Momentum Monday- Everyone Knows The Narrative…Ben Hunt Joins Me On Panic With Friends

  Be sure to follow me on Twitter.

• The “Lock-Down Trade” Reappears
  Eddy Elfenbein, December 21st, 2020 at 1:46 pm

  The good news is that Congress finally came to an agreement on another stimulus bill. Treasury Secretary Steven Mnuchin said that stimulus checks could go out as soon as next week.

  The bill would extend aid to millions of struggling households through stimulus checks, enhanced federal unemployment benefits and money for small businesses, schools and child care, as well as for vaccine distribution. It also repurposes $429 billion in unused funds provided by the Cares Act for emergency lending programs run by the Federal Reserve.

  For Wall Street, the stimulus is already old news. I think some agreement was assumed several weeks ago. The stock market slipped early this morning on worries of a new virus strain in the U.K. Within minutes, the S&P 500 was down nearly 2%.

  Once again, we saw the “lockdown trade” take shape. This was the pattern that was so prevalent earlier this year; travel stocks like airlines, hotels and vacation businesses took a big hit. Meanwhile, the stay-at-home and financial stocks did the best, or least-worst.

  The stock market hit its lowest before 10:30 and it’s been making back lost ground since then. The Dow is already positive. FactSet is doing poorly today despite a good earnings report.

• FactSet Earns $2.88 per Share
  Eddy Elfenbein, December 21st, 2020 at 9:16 am

  Earnings are out for FactSet (FDS). For its fiscal Q1, FactSet earned $2.88 per share. That beat Wall Street’s estimate of $2.75 per share. That’s up 11.6% over last year’s Q1.

  Adjusted operating margin improved 0.4% to 34.3%. Annual Subscription Value (ASV) plus professional services rose 5% to $1.56 billion. User count increased by 5,187 to 138,238. Annual ASV retention was greater than 95%. When expressed as a percentage of clients, annual retention was 90%.

  Here’s FactSet’s guidance:

  Organic ASV plus professional services is expected to increase in the range of $55 million and $85 million over fiscal 2020.

  GAAP revenue is expected to be in the range of $1,570 million and $1,585 million.

  GAAP operating margin is expected to be in the range of 29.5% and 30.5%.

  Adjusted operating margin is expected to be in the range of 32.0% and 33.0%.

  FactSet’s annual effective tax rate is expected to be in the range of 15.0% and 16.5%.

  GAAP diluted EPS is expected to be in the range of $10.05 and $10.45. Adjusted diluted EPS is expected to be in the range of $10.75 and $11.15.

  Both GAAP operating margin and GAAP diluted EPS guidance do not include certain effects of any non-recurring benefits or charges that may arise in fiscal 2021. Please see the back of this press release for a reconciliation of GAAP to adjusted metrics.