Sunday, May 7, 2017

Barrons weekend summary

Barrons weekend summary: positive on AMZN, NVS, TJX, ROST, BURL, GM, Ford 
Cover story: Barron's list of the best ETFs for income was chosen by Michael Arone of State Street Global Advisors (IEF, CWB, SRLN, ITE, FCVT), Jay Hatfield of Infrastructure Capital Management (PFF, SDY, AMLP, AMZA, PFFR), Putri Pascualy of Paamco (EMB, BKLN, SJNK, SHYG), and Fran Rodilosso of VanEck (FLOT, EMLC, FLRN, FLTR). 

1) Positive on AMZN: Shares could reach $1,000 by summer and $1,100 within a year, for a gain of close to 20%; By the end of the decade, the company's profits will balloon as revenues overwhelm costs and investments; 
2) Positive on TJX, ROST, BURL: Companies have managed to avoid being trounced by AMZN because they are in the off-price clothing business, and they stock stores opportunistically; 
3) Positive on NVS: "After a period of weak financial performance, Novartis could be poised for a multiyear run of earnings gains starting in 2018," driven by new drugs and a promising pipeline; 
4) Positive on GM, F: Shares are among the cheapest on a price/earnings basis in the S&P 500, but their valuations could rise in a turnaround, while TSLA's may drop if its Model 3 doesn't live up to expectations. 

Tech Trader: With AAPL, Wall Street is betting on momentum heading toward the next iPhone release, part of trend in which investors focus on a theme or narrative instead of how well the business is doing. 

Trader: Jason Pride of Glenmede says the final healthcare bill won't likely resemble what came out of the House, which passed by only the narrowest of margins; The stock buyback trend seems to be slowing, with $146B from S&P 500 companies through April 27, down 15% from the same period a year ago; Positive on REGN: Two issues face the company's investors: its valuation is high, and and it has been trading in a range for much of the year. 

Profile: Andy Johnson, manager of the Neuberger Berman Strategic Income fund, looks for stable income in a low-yield environment (top 10 sectors: mortgage-backed securities, U.S. investment grade credit, U.S. high yield, non-agency RMBS, U.S. nominal Treasury, U.S. TIPS, bank loans, global Treasuries, emerging market). 

Small Caps: Positive on OCFC: In a sector that offers less value than in the past, OceanFirst is worth considering because of an attractive, low-cost deposit base, modest credit costs, and good profitability. 

Follow-Up: Positive on MHK: Shares of world's largest flooring company are down following second-quarter results, a pullback that offers a fresh opportunity to buy. 

European Trader: Large integrated oil majors such as BP, Royal Dutch Shell, and Statoil have had a tough few years, but strong Q1 results are a sign cost-cutting and streamlining efforts are bearing fruit. 

Asian Trader: The upcoming presidential election in South Korea could boost inexpensive stocks, based on the winner's policies toward China, North Korea, and local chaebols. 

Emerging Markets: Greece's recent deal with the IMF for debt relief suggest it could be time for investors to consider the country's equities again. 

Commodities: "A cocoa glut has driven prices down near the lowest levels in 10 years, but analysts think prices need to weaken further to win back chocolate lovers." 

Streetwise: Stephanie Pomboy of MacroMavens thinks it's remarkable that AMZN is moving into the grocery business, since groceries as a percentage of retail sales are declining-has Jeff Bezos "run out of frontiers to conquer, or is it a hedge against what's to come?"