...January 20, 2013 Fortnightly Market Wrap -Up This week’s content: Macro Strategy – page 3 World Markets – page 9 Cautious optimism for 2013 By Swasti Gupta, Analyst, BSc Economics Eurozone – page 5 Currency wars: Is it me or is it getting hot in here? By Eliott Anderson, Co-Editor, BSc Management China – page 13 The EU: In or Out? By Christopher Viggor, Analyst, MSc Economics Eurozone – page 7 Take-off instead of hard landing? By Wodzik Kicinski, Analyst, BSc Economics Japan – page 15 Italy – is politics enough? By Andrei Damaschin, Co-Editor, BSc Accounting and Finance Challenges facing Japan By Melson Chun, Analyst, Law Warwick Investment Club Research Team 2 January 20, 2013 Fortnightly Market Wrap -Up Macro Strategy Cautious Optimism for 2013 By Swasti Gupta, Analyst, 2nd-year BSc Economics The S&P 500 closed on a 5-year high at 1,485.98 on Friday, after increasing for a third consecutive week since the New Year. The rally comes in response to strong fourth quarter earnings results, announced by banks and industrials earlier this week. Meanwhile Wall’s Street’s fear gauge, as measured by the VIX volatility index 1, closed the week at its lowest level since 2007 amidst speculation of a “great rotation”2. The CBOE VIX index is a measure of volatility perceived by investors. A forward looking measure, it is based on the pricing of options which investors use to protect their portfolios against losses in the S&P 500...
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...SAN FRANCISCO (MarketWatch) — Facebook Inc. isn’t the only social-media company marking the anniversary of its public trading debut this week. LinkedIn Corp. LNKD, +0.36% will celebrate the second anniversary of its initial public offering on Sunday, a day after Facebook FB, -1.53% marks its first birthday as a public company. In LinkedIn’s case, “celebrate” is the appropriate word. “LinkedIn has been the belle of the social IPO ball,” analyst Roger Kay of Endpoint Technologies Associates told MarketWatch. While it didn’t attract the pop culture frenzy that Facebook enjoyed, the LinkedIn IPO will be remembered as one of the most successful social-media trading debuts in history. LinkedIn shares edged up by a fraction to close at $182.35 on Friday. That’s roughly four times their IPO price of $45. When it debuted on May 19, 2011, the stock more than doubled to close at $94.25. On the other hand, Facebook ended its debut trading day with a gain of 23 cents. LinkedIn’s debut was supposed to be just the first wave of social-media IPOs that was expected to reach a high point with Facebook. LinkedIn didn't just have a far more successful trading debut, it has maintained a solid momentum. ‘LinkedIn has tapped into a core set of jobs that professionals want to get done around managing your professional network, looking for a new job, refining your skills. They kind of disrupted the Rolodex.’ Crawford Del Prete, IDC analyst LinkedIn has more than 225...
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...fourth quarter 2013 and first quarter 2014. Additionally, fourth quarter 2014 and first quarter 2015 reflects the discontinuance of Canadian operations and the closing of 133 stores abroad. Forecasted 2014 profits are indicative of the organizations struggle as they worked hard to regain trust and profits from massive data breach. Although Target’s 2014 Annual Report has not been made available, information listed at marketwatch.com indicated a decline in sales from $73.3 billion 2013 to $72.6 billion in 2014. Considering the potential damage that a massive security breach and troubled global expansion could cause, the modest decline noted an overall .4% fall in store sales (Marketwatch, 2015b)....
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...Investment Project CIGNA In Partial Fulfillment of the Requirements of: FINC5210- Investments Fall 1, 2012 Table of Contents Page 1: Background Page 2: CEO, Earnings and Finance Page 3: ROA and ROE Page 4: Net Profit Margin, Cigna Comparisons Page 5: Historical Stock Prices/ Future Stock Price Valuation Page 6: Stock Pricing, Dividends, Historical Returns Page 7: Trailing PE, Forward PE, and Forward PEG Page 8: References CIGNA 1 With roots dating back to 1972, CIGNA is a leading provider of healthcare and health benefits. The current iteration of CIGNA officially formed in 1982 after the merger of Connecticut General Insurance Corporation and INA Corporation. While Philadelphia is the home of CIGNA’s operations, the company has a diverse footprint located throughout the United States and internationally. Operating in five segments: healthcare, disability and life, international, run-off reinsurance and other operations, CIGNA is able to compete within nearly every aspect of the healthcare sector. CIGNA also operates retail pharmacies, even further diversifying its business model. However, the majority of CIGNA’s revenues come from its health care plans for companies who self- insure. One major differing aspect of CIGNA, compared to its competitors, is that the majority of its pretax operating income comes from its investment income. Unfortunately, this may make the company...
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...86% of big-cap fund managers trailed S&P 500 in 2014 - MarketWatch http://www.marketwatch.com/story/86-of-big-cap-fund-managers-trail... Time (EDT) 6 of 9 3/12/2015 5:38 PM 86% of big-cap fund managers trailed S&P 500 in 2014 - MarketWatch http://www.marketwatch.com/story/86-of-big-cap-fund-managers-trail... 9 comments 23 PEOPLE LISTENING + Follow NEWEST OLDEST Share | s robbins 7 hours ago No surprise here, but it continues to puzzle me. I built a test portfolio four months ago, picked eight stocks of companies I admire and watching how I do versus the S&P500....results: S&P flat, portfolio up 8%. Easy peasey......why can't fund mgrs do the same? Glenn Cheswick 7 hours ago @s robbins Only 14% beat the SPX this year. The stats get worse when you consider that each year only about 15-20% beat the index, and that list rotates. This means that over time, less than 10% consistently beat the index. Your portfolio may be up, and it may look easy, but can you do this on a regular basis? The answer is probably no. A better strategy is to use the SPX as an investment base, and let the other 90% try to beat you. Better to be the house. Tyler Buchanan @Glenn Cheswick @s robbins Also consider survivorship bias, if you consider all the funds that have closed it looks even worse for managed funds. 6 hours ago Glenn Cheswick @Tyler Buchanan @Glenn Cheswick @s robbins Excellent point Tyler. Thx. 6 hours ago Victor Reklaitis ...
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...June 23, 2015 Research Memorandum FROM: Dan Vo SUBJECT: Oprah’s Pontiac G6 Giveaway Problem Oprah opened her 2004-2005 season by giving away 276 Pontiac G6 on September 13, 2004. The problem arises when the people who received the cars should or should not include the value of the car in their taxable income for that year. The car’s designated value was $28,000. There has been debate on whether Oprah’s car was a gift or a prize. The IRS determined it was a prize because the audience had to apply for the seats on the show, and Oprah responded by picking people who needed the cars (MarketWatch, 2004). IRS Regulation 1.74-1 states “Prizes or awards which are includible in gross income include (but are not limited to) amounts received from radio and television giveaway shows.” Evidence In 2000, the first season of Survivor aired and its winner was rewarded $1 million. Richard Hatch claimed his prize as the winner of that season. However, he failed to claim the earnings on his taxable income for the next 6 years and was convicted of tax evasion. In the case United States v. Richard Hatch, Hatch violated 26 U.S.C. §§ 7201, which states “any person who willfully attempts in any manner to evade or defeat any tax imposed by this title shall be imprisoned…” He also violated 26 U.S.C. §§ 7206, which prevents fraud and false statements. Hatch was sentenced to 51 months in prison, and was still forced to pay his taxes. In another case, Turner v. Commissioner, the defendant...
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...Competitive Strategies and Government Policies Mar Viens ECO/365 January 26, 2015 Muhammad Bashir Competitive Strategies and Government Policies Globalization is the increasing integration of economies, cultures, and institutions across the world (Colander, 2013 ). Globalization is a cause for increased competition in smartphones leading to lower prices. Corporations producing smartphones face an increase in the number of competitors with the integration of economics in the global world. China is dominating many areas of the global consumer electronics, according to Global Consumer Electronics Market Outlook 2015 (MarketWatch, 2014), forcing domestic corporations to compete with foreign countries. The increased competition has corporations working harder to gain an advantage in the industry that allows companies to produce at lower prices than their competitors. Some government policies and regulations affect the industry, such as patents, anti-dumping laws, and electronic waste legislation. Some companies are motivated by patents to innovate while others are discouraged to innovate because of the patents. Companies can develop smartphones using patent protected devices or the processes are prevented from producing technological innovations. A few corporations have created better products than patent protected devices but are unable to sell the product. The lack of changes at times makes it hard to differentiate between phones. New devices such as the iPhone...
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...the time, along with the failure of the United States’ government fiscal departments to react in a timely fashion to curtail the spiraling affects being seen. Introduction The housing market in the United States during the late 1990’s and early 2000’s was booming. Low mortgage rates and high consumer confidence made the real estate market explode with activity. However, there was a downside to all this lending. Billions upon billions of dollars were lent to consumers with little vetting of their overall financial situation. These risky loans were bundled together and sold as mortgage backed securities. Eventually, the market collapsed for these securities, issuing in the start of The Great Recession. Housing Market According to MarketWatch (2007), 30-year mortgage rates at the end of 2006 were sitting at 6.37%. This was wonderful news for new prospective housing customers, as well as existing mortgage holders. New mortgage customers purchased their dream home while keeping their payments reasonably low. Existing mortgage holders took advantage of the lower mortgage rates, too, by refinancing their existing loans. The Bureau of Labor Statistics (2017) data shows that 49% of unemployed jobseekers in 2007 took on average less than five weeks to find employment. This data supports that the United States’ economy was in good shape, as almost half of all jobseekers located a new job in a short amount of time. However, by the end of 2009, this feel good scenario was over...
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...FINANCIAL RELATIONSHIP [aNALYSIS OF NESTLÉ’S RATIOS] | | | | Submit for: Mark Paronich Submit by: Tam Nguyen – 001794465 | | COMPANY OVERVIEW: Nestlé is the world’s leading multinational company in food and beverage manufacture, with headquarters in Switzerland. Nestlé has a wide range of products such as baby foods and cereals, milked-base products, snack food and health related products. Since it was founded in 1866, Nestlé has been growing and operating through six segments: Zone Europe; Zone Americas; Zone Asia, Oceania and Africa; Nestlé Waters; Nestlé Nutrition; and Other (MarketWatch 2015). Currently, Nestlé employs total of 339,000 people around the world. (Source: Annual Report, Nestlé Company 2014) ANALYSIS OF FINANCIAL RATIOS: To begin with, it is important to consider analysis of financial statements as one of key components to “measure profitability and financial conditions of a company” (Mark 2014). There are three basic financial statements consisting of: * The balance sheet: which summarize what a firm owns and owes at a given moment of time * The income statement: which reports on how much a company earned for a specific period of analysis * The statement of cash flows: which records on cash inflows and outflows to the firm during the period of analysis In this paper, some of typical ratios relating...
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...AIG: From Bailout to Bonuses (2008) Based on a paper by: Paige Vandermyn & Holden Canty Summary by: Andrew F. Roberts During 2008's "too big to fail" bailouts exercised by the federal reserve, many struggling multi-national companies were awarded cash in hopes of avoiding bankruptcy. One company deemed simply too big to fail was the American International Group, Inc. (AIG for short), which provides insurance for individuals and businesses. The company, which would have almost certainly been forced into bankruptcy if not for the bailout, received hundreds of millions of dollars to keep from drowning. However, in an utterly shocking series of events, the company paid $218 million to top executives in bonus money. In a completely unethical fashion, the company used taxpayer bailout money to fund vacations and private jet flights to the executives who many blamed for causing AIG's financial troubles in the first place. Additionally, many senior employees were flown to California for a "retreat" including spa treatments and golf outings. This retreat cost over $400,000 dollars. By the end of 2008, AIG had received over $100 billion in bailout money. Unfortunately, the general public was not sure if the money was going toward improving business of simply paying for luxuries of the organization. These actions by AIG completely ignored each and every theory related to the study of ethics. In regards to the individualistic theory of ethics, AIG seemingly followed...
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...PEPSICO a Solid Investment. By: Alexandra Fell For: Dr. Guendo0 Yorkville University July 2014 BUSI 1023 A pharmacist named Caleb Bradham invented Pepsi in 1893, it was originally named “Brad’s Drink”, before changing to it’s widely recognized name Pepsi-Cola, in 1898. Although Pepsi has faced many tough financial times historically, two bankruptcies and three offers to Coca-Cola to purchase the company between 1922-1933, the company has always managed to reinvent itself, and carve out its own market share, and today is not any different. In order for PepsiCo to see continued success they must be able to expand into different markets, increasing their consumer base and maximizing profits. PepsiCo is broken down into these four operating units: PepsiCo Americas Foods, which includes food and snack businesses in North America and Latin America. PepsiCo Americas Beverages, which includes all of their North American and Latin American beverage businesses. PepsiCo Europe. PepsiCo Asia, Middle East and Africa. PepsiCo’s main competitors in the non-alcoholic beverage industry are the Coca-Cola Company and Dr. Pepper Snapple Group Inc, their main competitor and long time rival is Coca-Cola. Coca-Cola has the larger market share of carbonated soda drinks, however; PepsiCo holds strong with its larger market share in liquid refreshment beverages like Gatorade and Tropicana. PepsiCo also has a leadership position in the snack industry world wide, against other food and...
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...Royal Dutch Shell Introduction and strategic profile of the firm 1. The company and the industry Royal Dutch Shell, commonly known as Shell, is a company incorporated in the United Kingdom, headquartered in the Netherlands, the Anglo-Dutch multinational oil and gas companies. Created by the merger of Royal Dutch Petroleum and UK-based Shell Transport & Trading, which is the largest company in the world. Shell's business is very extensive, including exploration and exploitation of oil and natural gas, petroleum products and chemical products marketing, coal and natural gas production, processing, marketing, power generation business, as well as renewable energy. 2. Overview of firm’s corporate, business, and international strategies Shell operates 10% of the global oil and gas resources for exploration and exploitation in more than 50 countries worldwide and operates in more than 100 countries and regions. The industry of shall is consisted by 14 segments, each operating oil, gas, chemical products, non-ferrous metals, coal and so on, where oil and fossil fuel production and sales capacity ranks second in the world. Shell invests in more than 130 countries, has more than 100,000 employees, and total assets over 100 billion dollars. Today, Shell companies business involve in many countries, more than any other oil groups. The key of Shell's international strategy is that explore gas and oil in about fifty countries, petroleum refining in 34 countries, and the oil...
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...Financial Statement Review Elisha Cervantes ACC 561 Seth Fargen November 16, 2015 Financial Statement Review The Walt Disney Company is the corporation chosen for the financial statement review. The Walt Disney Company (Disney) “operates through five business segments: Media Networks, Parks & Resorts, Studio Entertainment, Consumer Products and Interactive Media” (Forbes, 2015, p. 1). These segments include television and cable networks, radio networks, Resorts, motion picture studios, and retail stores (Forbes, 2015). Walt Disney is one of the largest corporations and brands in the world. Net Income Walt Disney reported a net income of $8,004 million in 2014 and net income of $6,636 million in 2013 (The Walt Disney Company, 2014). The net income increased in 2014 compared to the net income in 2013. Investors of Walt Disney found the increase in net income important because it shows Walt Disney is increasing profits by making positive decisions for the company. Money-zine.com states, “Perhaps the single most important measure of a company's profitability is net income. That's because generating profits is the most important responsibility that for-profit companies have to their shareholders” (Money-zine.com, 2015, p. 1). Stakeholder’s Equity The ending balance of stockholders’ equity for Walt Disney in 2014 was $44,598 million. Labor unions are interested in the stockholders’ equity to sponsor "proposals that would increase their negotiating leverage...
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...Monique Davis Strayer University – Online Campus FIN 534 Professor Ronal Lentz Monique Davis December 11, 2011 Company profile ITT Corporation (NYSE: ITT) is a global manufacturer and top 10 U.S. defense contractor specializing in electronics and fluids with annual revenues of about $11 billion. As the largest supplier of pumps and systems in the transport and treatment of water, ITT offers its services to local governments in the U.S. and to the governments of developing nations. ITT also manufactures electronics such as night vision goggles and communication systems for the U.S. military. The future of ITT's fluids business depends on the global demand for clean water, especially in developing countries such as China and India. The growth in agriculture, increasingly wealthy populations, and widespread pollution in these developing countries have contributed to the rising demand for clean water. ITT is just one of many competitors working to bring clean water to developing nations. (WIKI Invest, 2011) provides that during the financial period about 58% of ITT's revenue is generated by its defense and information solutions business segment. As a result, a significant proportion of ITT's revenues come directly from U.S. government contracts. Since the September 11, 2001 terrorist attacks, U.S. defense spending has risen over 35%, reaching $896.2 billion in 2010. ITT consists of three business segments: Defense Electronics...
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...Democratic presidential frontrunner Hillary Rodham Clinton is promoting tax measures that would increase federal revenues by $1.1 trillion over the coming decade, according to a new analysis. Compared to Republican plans, which typically cut taxes, her proposal could help stabilize the nation’s ballooning debt if she also finds a way to reduce existing government spending. Related Stories [$$] GOP Candidates Need Better, Pro-Growth Tax Plans The Wall Street Journal Bernie Sanders' Tax Plan: Here's How Much the Wealthiest Americans Would Pay Motley Fool How Much in Taxes Does Bernie Sanders Want You to Pay? Fortune Will Americans Get "Berned" by Sanders' Tax Plan? Motley Fool 4 tough questions that Trump and Sanders need to answer MarketWatch Peter Schiff: China will Lose the Currency War Wall Street Daily Sponsored Clinton’s proposals for boosting taxes on high-income earners, modifying taxation of multi-national corporations, doing away with fossil fuel tax incentives and increasing the estate and gift taxes would fall hardest on the top 1 percent of taxpayers, while leaving 95 percent of Americans relatively unscathed, according to an analysis released on Thursday by a joint venture of the Urban Institute and the Brookings Institution. Clinton’s tax plan, including some leftover ideas from the Obama administration, would almost certainly encounter stiff opposition from the GOP controlled Congress which opposes any tax increases. Moreover, Clinton has advanced a raft...
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