Sunday, June 26, 2016

Barrons weekend summary

Barrons weekend summary: positive on TSCO and GS 

Cover story: Shock waves from the Brexit are likely to rattle markets and economies around the globe for some time; Felix Zulauf of Zulauf Asset Management says the Brexit isn't an isolated happening, but a swing against the political establishment and probably the beginning of the disintegration of the EU; "Whatever central banks do or don't do, global markets face a prolonged stretch of political and economic uncertainty, which will tend to reinforce each other." 

1) The drop in U.S. stock indexes following the Brexit vote doesn't signal the end of the bull market, since U.S. stocks remain more insulated from global developments than those in any other major equity market; 
2) "For investors bullish on Puerto Rico's prospects, the best bet is its $12.7B of general-obligation bonds, plus some $5.7B of less-liquid commonwealth-guaranteed debt"; 
3) Positive on TSCO: Company is one of this year's most successful retailers because two megatrends-aging baby boomers and the craze for organic food-has led to a boom in hobbyist farming; 
4) Positive on GS: Firm's ability to cut costs, along with a strong balance sheet, should help it in the current downturn, and its reasonably priced shares could gain 30%. 

Tech Trader: Positive on AMZN, GOOGL, MSFT: Cloud computing will continue to make these tech giants increasingly powerful, while FB will benefit from the shift in ad dollars from TV, radio, and print to online; Cautious on FIT: Company's step trackers and smartwatches face fierce competition from AAPL, GRMN, and Samsung. 

Trader: The Brexit will favor North American financial stocks over European ones, says Brian Belski of BMO Capital Markets; Positive on UNF: Along with WFM, company is one of the few sizeable pure plays in organic food; a turnaround focused on faster-growing and higher-margin foods make the stock attractive. 

Retirement Investing: Barron's list of the Top 50 Annuities for 2016 looks at how new rules, lower interest rates, and longer lives are set to affect the sector. 

Profile: Marcus Hughes of the LHC Capital Australia High Conviction fund; the firm owns just 10 stocks and has average annual gains of more than 23%. 

Interview: Bruce Geller of New York money manager Dalton Greiner Hartman Maher looks for stocks that have been forgotten because they're too small or their performance and potential is hidden for some reason. 

Small Caps: Positive on AFI: Company may not be as strong as rival AWI, but with leading market share in most hardwood floors and management working to turn around the business, shares have upside. 

European Trader: The U.K. may end up paying a heavy price for its departure from the EU, as foreign direct investment slows, unemployment rises, and consumer spending falls. 

Asian Trader: With the departure of SoftBank Group president Nikesh Arora and the decision of Masayoshi Son to remain as CEO, the Japanese company "increasingly looks like a debt-fueled venture capital firm that's reluctant to sell its investments." 

Emerging Markets: Among the countries hardest hit by the global selloff following the Brexit were the volatile developing nations of Greece, Poland, South Africa, and Turkey. 

Commodities: A global shortage of zinc has sent prices up, making it one of this year's best performing metals. 

Streetwise: "Bigger dividends and stock buybacks won't solve banks' profitability problem, but at least it eases the pain while investors await a solution."