#MICUS: Value Managers Say Their Style Is Far From Over
Note of Chuck Bath, David Wallack, and Ramona Persaud's presentation from the 2020 Morningstar Investment Conference. Q2 2020 hedge fund letters, conferences and more Dead Again? Value Managers Say Their Style Is Far From Over For more than a decade, large value has been one of the most difficult factors to own. Moderator Linda Abu Read More
- US: Dow: 12676.00 (0.47%), S&P 500: 1337.89 (-0.03%), NASDAQ: 2854.24 (-0.31%)
- Europe: CAC: 3081.74 (0.23%), DAX: 6406.52 (0.25%), FTSE: 5498.32 (-0.02%).
- Asia-Pacific: Australia: 4123.90 (-0.23%), China: 2136.15 (-0.39%), Hong Kong: 18877.33 (-0.14%), India: 5109.60 (-0.36%), Japan: 8365.90 (-1.45%).
- Metals: Gold: 1608.10 (2.02%), Silver: 27.47 (2.44%), Copper: 3.37 (0.64%)
- Energy: Crude Oil: 88.97 (0.53%), Natural Gas: 3.07 (-3.67%)
- Commodities: Corn: 7.88 (1.25%), Soya Bean: 16.15 (2.93%), Wheat: 9.15 (3.01%)
- Currency: Euro (€) / US Dollar ($) (EURUSD): 1.2152 (-0.74%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.5496 (0.04%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 78.1650 (-0.00%)
- 10 year US Treasury: 1.397% (0.010)
Market and Economy News Update
U.S. markets end mixed: The Dow Jones Industrial Average snapped a three day losing steak to end higher on Wednesday amid better than expected earnings from The Boeing Company (NYSE:BA) and Caterpillar Inc. (NYSE:CAT). The S&P 500 however erased gains in the final hour of trading. The Dow Jones Industrial Average (INDEXDJX:.DJI) gained 58.73 points, or 0.47 percent, to finish at 12,676.05. The S&P 500 (INDEXSP:.INX) slid 0.42 points, or 0.03 percent, to end at 1,337.89, while the NASDAQ Composite (INDEXNASDAQ:.IXIC) dipped 8.75 points, or 0.31 percent, to close at 2,854.24.
Oil prices rise: Oil prices increased for the second consecutive day amid hopes that the Federal Reserve will initiate more steps to provide stimulus to the economy. Investors, however shrugged off Energy Department data that showed U.S. stockpiles unexpectedly climbed last week as production increased to the highest level in 13 years. Crude oil for August delivery gained 0.5 percent, to settle at $88.97 a barrel on the New York Mercantile Exchange. Brent oil for September settlement increased 0.9 percent to $104.38 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
· Visa Inc (NYSE:V) posted fiscal third-quarter adjusted earnings of $1.1 billion, or $1.56 a share that beat consensus estimates of $1.45 a share. Revenue increased 10 percent to $2.6 billion that also beat estimates of $2.52 billion.
· Online game maker Zynga Inc (NASDAQ:ZNGA) reported second quarter earnings per share of 1 cent, on revenue of $332 million that missed analysts’ expectations 5 cents a share on revenue of $344 million. The company also slashed its full-year earnings outlook.
· Whole Foods Market, Inc. (NASDAQ:WFM) reported third quarter net income of $116.8 million, or 63 cents per share. Analysts were expecting a profit of 61 cents per share. Same-store sales at the upscale grocer increased 8.2 percent, against expectations of a gain of 8.4 percent.
· Western Digital Corp. (NASDAQ:WDC) posted fourth quarter earnings excluding one-time items of $3.35 a share, on revenue of $4.75 billion that easily beat Street estimates of earnings excluding items of $2.47 profit on $4.25 billion in revenue.
· Symantec Corporation (NASDAQ:SYMC) unexpectedly fired its chief executive Enrique Salem, and replaced him with its chairman Steve Bennett, after reporting a 9.9 percent decline in first-quarter profits, and providing soft guidance for the current quarter.
· Tech company Akamai Technologies, Inc. (NASDAQ:AKAM) posted earnings excluding one-time items of 43 cents a share, on revenue of $331 million that beat consensus estimates of earnings of 37 cents a share on revenue of $326 million.
· WellPoint, Inc. (NYSE:WLP) posted second quarter earnings excluding items of $2.04 per share, 4 cents below the average analysts’ estimate. Revenue increased 2 percent to $15.17 billion, also missing estimates. The second-largest U.S. health insurer also cut its full-year profit forecast.
· US Airways Group, Inc. (NYSE:LCC) reported second quarter earnings excluding items of $1.61 a share, 5 cents above Street expectations. Revenue increased 7.2 percent to $3.75 billion, in line with analysts’ expectations.
- Shoe manufacturer Crocs, Inc. (NASDAQ:CROX) posted second quarter earnings that beat expectations, but revenue trailed estimates. The company also raised its current quarter and full-year earnings outlook.
- Photo-publishing site Shutterfly, Inc. (NASDAQ:SFLY) reported lower than expected second quarter loss on revenue that topped consensus estimates. The company also provided full-year guidance at the higher end of the estimated range.
- Altera Corporation (NASDAQ:ALTR) posted better than expected second quarter profit and revenue topped, forecast strong third quarter sales on robust demand for its wireless-communications gear.
- International Game Technology (NYSE:IGT) reported third quarter adjusted earnings of 23 cents a share on revenue of $532.8 million that missed the average analysts’ estimate of earnings of 28 cents a share on $563.8 million in revenue.
- Cigarette maker Lorillard Inc. (NYSE:LO) reported second quarter earnings excluding certain items of $2.19 per share that missed the consensus estimate of $2.32 a share. Sales rose 2.3 percent to $1.73 billion, but total wholesale shipments fell 1.2 percent.
- Drug and medical device maker Baxter International Inc. (NYSE:BAX) increased its quarterly dividend by 34 percent and approved a new $2 billion share repurchase program.
- Biopharmaceutical company Regeneron Pharmaceuticals Inc (NASDAQ:REGN) reported a better-than-expected second quarter profit, and raised its full-year sales forecast for its eye drug Eylea, for the third time this year.
- Offshore deepwater drilling company, Seadrill Ltd (NYSE:SDRL) has won a deal worth approximately $4 billion from a major oil company for three ultra-deepwater drill ships to be used in the Gulf of Mexico.
- Oil refinery company Marathon Petroleum Corp (NYSE:MPC) raised its quarterly dividend by 40 percent from 25 cents per share to 35 cents per share.
- MetLife Inc (NYSE:MET)has named John Hele as its new CFO.
Hedge Fund News Update
- New York-based hedge-fund manager BlueMountain Capital Management LLC said its Credit Alternatives Fund recorded a 1.43 percent gain in June, bringing its first half returns to 10.17 percent.
- German finance ministry has proposed a new bill that plans to restrict direct investment in hedge funds to professionals in order to protect investors from suffering big losses on risky assets.
- Jean-Noel Payer, a former trader at Nomura Holdings Inc has received regulatory clearance this week to launch a $250 million Asia-focused volatility hedge fund, Voltex Asia Capital Ltd.
- Specialist currency funds suffered their biggest loss in three months in June as a sharp turnaround in the euro frustrated investors who were expecting it to extend its decline against the dollar.
- OrbiMed Advisors is planning to close its flagship hedge fund, Caduceus Capital, to new investment, as early as this quarter. Caduceus Capital, which currently has $1.8 billion in assets under management, will stop accepting new investments when it reached the $2 billion mark.
Brokerage Upgrades and Downgrades on Wednesday, July 25, 2012
- Amgen, Inc. (NASDAQ:AMGN) was raised to “outperform” from “neutral” by analysts at Credit Suisse.
- Dole Food Company, Inc. (NYSE:DOLE) was raised to “buy” from “underperform” by analysts at Bank of America
- Global Payments Inc (NYSE:GPN) was lifted to “buy” from “neutral” by analysts at Goldman Sachs.
- Illumina, Inc. (NASDAQ:ILMN) was upgraded to “outperform” from “sell” by analysts at Credit Agricole.
- Kirby Corporation (NYSE:KEX) was lifted to “buy” from “neutral” by analysts at Bank of America.
- Regions Financial Corporation (NYSE:RF) was raised to “buy” from “neutral” by analysts at SunTrust.
- Regeneron Pharmaceuticals Inc (NASDAQ:REGN) was upgraded to “outperform” from “market perform” by analysts at BMO Capital Markets.
- Sunstone Hotel Investors Inc (NYSE:SHO) was lifted to “outperform” from “neutral” by analysts at Robert W. Baird with a target price of $12.
- Symantec Corporation (NASDAQ:SYMC) was raised to “outperform” from “sector perform” by analysts at RBC Capital Markets.
- Whirlpool Corporation (NYSE:WHR) was upgraded to “outperform” from “market perform” by analysts at Raymond James.
- Avery Dennison Corporation (NYSE:AVY) was downgraded to “underperform” from “neutral” by analysts at Bank of America.
- C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW) was cut to “hold” from “buy” by analysts at Deutsche Bank.
- Ctrip.com International, Ltd. (ADR) (NASDAQ:CTRP) was downgraded to “equal weight” from “overweight” at Morgan Stanley.
- Dice Holdings, Inc. (NYSE:DHX) was lowered to “hold” from “buy” by analysts at Stifel Nicolaus.
- Enbridge Energy Partners, L.P. (NYSE:EEP) was cut to “neutral” from “overweight” by analysts at JPMorgan Chase.
- Hatteras Financial Corp. (NYSE:HTS) was downgraded to “market perform” from “outperform” by analysts at Wells Fargo & Co.
- International Game Technology (NYSE:IGT) was downgraded by analysts at Credit Suisse from “outperform” to “neutral.”
- Safe Bulkers, Inc. (NYSE:SB) was cut by analysts at Bank of America from “neutral” to “underperform.”
- Southwest Gas Corporation (NYSE:SWX) was lowered to “neutral” from “buy” by analysts at Citigroup.
Earnings Calendar for Thursday, July 26, 2012
Before market open:
AmerisourceBergen Corp. (NYSE:ABC)
Ball Corporation (NYSE:BLL)
Bemis Company, Inc. (NYSE:BMS)
Boston Scientific Corporation (NYSE:BSX)
BorgWarner Inc. (NYSE:BWA)
Cameron International Corporation (NYSE:CAM)
Celgene Corporation (NASDAQ:CELG)
CME Group Inc (NASDAQ:CME)
The Dow Chemical Company (NYSE:DOW)
Dr Pepper Snapple Group Inc. (NYSE:DPS)
FLIR Systems, Inc. (NASDAQ:FLIR)
Starwood Hotels & Resorts Worldwide, Inc. (NYSE:HOT)
The Hershey Company (NYSE:HSY)
International Paper Company (NYSE:IP)
Interpublic Group of Companies, Inc. (NYSE:IPG)
Iron Mountain Incorporated (NYSE:IRM)
Kimberly Clark Corp (NYSE:KMB)
Leggett & Platt, Inc. (NYSE:LEG)
L-3 Communications Holdings, Inc. (NYSE:LLL)
Moody’s Corporation (NYSE:MCO)
The McGraw-Hill Companies, Inc. (NYSE:MHP)
Mead Johnson Nutrition CO (NYSE:MJN)
3M Co (NYSE:MMM)
Mylan Inc. (NASDAQ:MYL)
Noble Energy, Inc. (NYSE:NBL)
NextEra Energy, Inc. (NYSE:NEE)
National-Oilwell Varco, Inc. (NYSE:NOV)
MetroPCS Communications Inc (NYSE:PCS)
PulteGroup, Inc. (NYSE:PHM)
ProLogis Inc (NYSE:PLD)
Sprint Nextel Corporation (NYSE:S)
United Technologies Corporation (NYSE:UTX)
Vulcan Materials Company (NYSE:VMC)
Ventas, Inc. (NYSE:VTR)
Waste Management, Inc. (NYSE:WM)
Watson Pharmaceuticals, Inc. (NYSE:WPI)
Exxon Mobil Corporation (NYSE:XOM)
During market hours:
CONSOL Energy Inc. (NYSE:CNX)
Invesco Ltd. (NYSE:IVZ)
Raytheon Company (NYSE:RTN)
Zimmer Holdings, Inc. (NYSE:ZMH)
After market close:
Amgen, Inc. (NASDAQ:AMGN)
Amazon.com, Inc. (NASDAQ:AMZN)
CA, Inc. (NASDAQ:CA)
The Chubb Corporation (NYSE:CB)
Cerner Corporation (NASDAQ:CERN)
Cincinnati Financial Corporation (NASDAQ:CINF)
Expedia Inc (NASDAQ:EXPE)
Federated Investors Inc (NYSE:FII)
McKesson Corporation (NYSE:MCK)
Principal Financial Group Inc (NYSE:PFG)
Republic Services, Inc. (NYSE:RSG)
Starbucks Corporation (NASDAQ:SBUX)
VeriSign, Inc. (NASDAQ:VRSN)
Time not specified:
Colgate-Palmolive Company (NYSE:CL)
CMS Energy Corporation (NYSE:CMS)
KLA-Tencor Corporation (NASDAQ:KLAC)
Occidental Petroleum Corporation (NYSE:OXY)
Precision Castparts Corp. (NYSE:PCP)