Four Buy List Earnings Reports This Morning
Posted by Eddy Elfenbein on April 19th, 2018 at 8:58 am

This is a very busy morning for us. We’ve had four of our Buy List stocks report earnings. Let’s go through them.

Alliance Data Systems (ADS) had adjusted earnings of $4.44 per share. That beat expectations of $4.23 per share. Revenue came in a bit light at $1.88 billion. Analysts were expecting $1.92 billion. The company reiterated their full-year guidance of $22.50 to $23 per share with revenue of $8.35 billion.

Danaher (DHR) had a very good report. For Q1, they made 99 cents per share. They also raised their guidance. The old range was $4.25 to $4.35 per share. The new range is $4.38 to $4.45.

Snap-on (SNA) earned $2.79 per share. The stock looks to gap up over 5% this morning.

Signature Bank (SBNY) earned $2.48 per share for Q1. But excluding the company’s loss on medallion loans, they made $2.69 per share which was two cents more than estimates.

Morning News: April 19, 2018
Posted by Eddy Elfenbein on April 19th, 2018 at 7:06 am

China’s Big Bang

An Oil Deal Between Saudi and Russia Worked. Now What?

NY Attorney General Seeks Power to Bypass Presidential Pardons

VIX Rigging Talk Erupts on Wall Street After Another Wild Swing

Amazon’s Bezos Says Company Topped 100 Million Prime Members

P&G to Acquire Merck KGaA’s Consumer-Health Unit

Qualcomm Might Be Collateral Damage in a U.S.-China Trade War

China Wary of Qualcomm’s $44 Billion NXP Deal Amid Tensions With U.S.

Fox Rejected Higher Comcast Bid Due to Antitrust Concerns

Bye-Bye, Bon-Ton: Liquidation Is Coming

SunPower Buys U.S. Rival SolarWorld to Head Off Trump Tariffs

Can Training Eliminate Biases? Starbucks Will Test the Theory

Cullen Roche: These Are Not Good Indexing Criticisms

Jeff Carter: Transparency Is Good

Howard Lindzon: A Market of Stocks is Not For Everyone and Jeff Bezos Annual Letter

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Torchmark Earned $1.47 per Share
Posted by Eddy Elfenbein on April 18th, 2018 at 4:15 pm

After the closing bell, Torchmark (TMK) reported Q1 net operating earnings of $1.47 per share. That’s up from $1.15 per share one year ago. Wall Street had been expecting $1.45 per share. Here are some highlights:

Net income as an ROE(1) was 11.5%. Net operating income as an ROE excluding net unrealized gains on fixed maturities(1) was 14.6%.
Life underwriting margins increased over the year-ago quarter by 7% and health underwriting margins increased over the year-ago quarter by 9%.
Life premiums increased over the year-ago quarter by 9% at American Income and health premiums increased by 8% at Family Heritage.
Net health sales increased over the year-ago quarter by 11%.
Average producing agent counts increased over the year-ago quarter by 15% at Liberty National and 11% at Family Heritage.
1.0 million shares of common stock were repurchased during the quarter.
(1) Includes the impact of the change in the corporate income tax rate from 35% to 21% due to the recent tax reform. See further discussion of the tax reform on page 2.

The company sees full-year net operating income ranging between $5.93 and $6.07. Wall Street had been expecting $6.03 per share.

A Bounce for Energy
Posted by Eddy Elfenbein on April 18th, 2018 at 12:56 pm

Here’s a look at one of the more remarkable stock charts of the last 20 years. This shows the relative strength of the energy sector.

Energy stocks outpaced the market by a good margin until 2008. The peak came on Jul 1, 2008. Since then, energy stocks have badly lagged the market.

But in the last month, energy stocks have gapped up strongly. It’s hard to say if this rally is for real when so many other bounces were false rallies.

Even after the recent bump, some big energy stocks, like XOM and CVX, yield close to 4%.

Morning News: April 18, 2018
Posted by Eddy Elfenbein on April 18th, 2018 at 7:09 am

U.S. Moves to Block Sales by Chinese Telecom Equipment Makers

Taxpayers Get an Extra Day to File After IRS Computers Fail

Facebook to Follow Privacy Rules in Europe, Then Everywhere Else

IBM Margin Slump Hits Stock as Investors Lose Patience With Big Blue Turnaround

Toys ‘R’ Us Rejects Rescue Offer From Little Tikes’ Larian

Bon-Ton Assets Snapped Up by Liquidation Firms, Bondholders

Electric Scooters Are Giving U.S. Cities Uber Déjà Vu

Supreme Court Weighs Internet Sales-Tax Case

Alesia Haas Is Leaving Och-Ziff to Become Coinbase’s CFO

Goldman Profit Surges but Investors Lament Buyback Pause

Down $1 Trillion, World’s Worst Stocks Near Make-or-Break Level

Ben Carlson: Why It Makes No Sense to Compare Dividend Yields to Bond Yields

Michael Batnick: At First Glance & Animal Spirits: Some Things We Learned

Joshua Brown: The Most Hated Tax Cut Ever?

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Morning News: April 17, 2018
Posted by Eddy Elfenbein on April 17th, 2018 at 7:11 am

China to Allow Full Foreign Ownership in Auto Industry

VW to Tesla Set to Win From China Move to Remove Ownership Caps

In New Sign of Trade Battle, China Slaps U.S. Sorgum Producers With 179% Deposit

U.S. Ban Risks Leaving China’s Rising Tech Star ‘Half Dead’

Trump Picks Monetary Expert For No. 2 Job at the Fed

Washington Would Be Crazy to Break Up Amazon

What Would a Paid Facebook Look Like?

Will You Soon Have To Pay Sales Tax On Every Online Purchase?

Johnson & Johnson: Is Zytiga Patent Loss Priced In?

Netflix Subscriber Gains Keep the Cash-Hungry Machine Humming

UnitedHealth Increases Guidance For the Year

Elon Musk Just Poured More Than $100 Million Into The Boring Company

Michael Batnick: The What-Ifs

Joshua Brown: Instant Fact Check

Nick Maggiulli: In the Land of the Lost

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The S&P 500 Is Up 1% Today
Posted by Eddy Elfenbein on April 16th, 2018 at 1:31 pm

This is turning out to be quite a good day for the stock market.

Our Buy List is doing even better. There a few things I wanted to point out. Notice how we’ve bounced from the 200-day moving average (the blue line). However, the latest bounce is much less than the previous one.

Also, notice how much smaller the daily crosses were in January compared to later. That’s how much volatility has shifted.

Retail Sales +0.6%
Posted by Eddy Elfenbein on April 16th, 2018 at 10:59 am

The market is getting a nice bounce this morning. We learned that retail sales rose by 0.6% in March. In the last year, retail sales are up 4.5%. Retail sales excluding gasoline was up 0.6% in March.

Today’s rally is quite broad. Many sectors are joining in. Since March 23, the S&P 500 has been locked in a band about 3% wide. Right now, we’re “testing” the upper end, which is about 2,670 or so. I’ll be curious to see if the bulls have enough confidence to push us higher.

TDI Podcast
Posted by Eddy Elfenbein on April 16th, 2018 at 10:47 am

This weekend, Andrew Horowitz invited me on the Disciplined Investor Podcast. I had a great time. We covered a lot of topics including the history of Crossing Wall Street. Check it out.

Morning News: April 16, 2018
Posted by Eddy Elfenbein on April 16th, 2018 at 7:11 am

Wall Street Economists See Global Growth Cresting Not Collapsing

Oil Prices Drop as Fears About Syria Strikes Fallout Wane

If Fed Moves Unlock Billions at Banks, Here’s Who Might Win Most

Silicon Valley Venture Capitalists Prepare for an I.P.O. Wave

Wall Street Titan Takes Aim at Law That Tripped Him Up

Adecco Buys General Assembly in $412.5 Million Deal to Boost Growth

WPP CEO Departure May Herald Empire Breakup, Strategy Shift

Pentagon Cited Boeing Over Quality Concerns Going Back Years

Shire to Sell Oncology Unit for $2.4 Billion as Takeda Mulls Takeover

Ola Wants a Million Electric Rides on India’s Roads by 2021

How Tesla’s Elon Musk Makes a Strategy Out of Defiance

Elliott Stake Adds to Pressure for Whitbread Split, Analysts Say

Howard Lindzon: Reminders …The Markets and Your Data Never Sleep

Ben Carlson: 3 Ways to Make Up For a Retirement Savings Shortfall

Lawrence Hamtil: Factor Performance and Drawdown Duration in the U.S., Europe, and Japan

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