Saturday, October 21, 2017

Barron's weekend summary

Barron's weekend summary: cover on concerns about FB, AMZN & GOOGL; positive features on COH, CZR, DWPW 
Cover story: FB, AMZN, and GOOGL are key drivers of recent stock market highs, but regulators are beginning to challenge the way they dominate their respective sectors; Beyond antitrust issues, there is concern about the huge amounts of personal data they store, and these challenges could affect their valuations. 

Features: 1) Positive on COH: Handbag maker, which is set to rebrand itself as Tapestry (TPR), is finally on the right track after years of declining sales, and shares could return 30% during the next 12 months; 2) Positive on DWDP: As chief executive Edward Breen restructures the company, the shares could post gains of as much as 15-30% over the next year, including dividends; investors should buy before it splits into three businesses; 3) Positive on CZR: The largest U.S.-focused gaming company has emerged from a difficult bankruptcy with a stronger balance sheet and less debt, and under a quality management team it appears poised for growth. 

Trader: Optimism about the market refuses to be dented, and “there’s little evidence to suggest that dips in the market shouldn’t be bought” as it continues to slowly move upward; With Japan’s economy growing more consistently than it has in a decade, the market seems poised to break out; The fact that UAL can get pounded for poor earnings while AAL and DAL drop just a little suggests the market is distinguishing between the carriers. 

Interview: Laura Geritz, manager of Rondure New World and Rondure Overseas “has a laserlike focus on stock analysis and a deep conviction that the best returns can be found overseas” (picks: WH Smith, SBUX, Create SD Holdings, Matsumotokiyoshi, Cosmos Pharmaceutical, Aselsan, Bharat Electronics). 

Profile: Stephen Liberatore, manager of TIAA-CREF Social Choice Bond, which has averaged an annual return of 3% during its five-year existence and beats 88% of all intermediate-term bond funds (top sectors: foreign government/corporate USD denominated bonds, U.S. agency & U.S. Treasury, municipal, mortgage-backed securities). 

Follow-Up: MS “hasn’t abandoned investment banking and trading even as it’s reduced its dependence on those volatile units,” and the firm has been a top player in mergers and acquisitions this year. 

European Trader: Cautious on Deutsche Lufthansa: Carrier will benefit from the collapse of Air Berlin, but the real reasons to buy are its recent five-year deal with pilots, its stellar reputation, and strong demand. 

Asian Trader: Positive on Samsung Electronics: Company has gotten past its Galaxy Note 7 problems, and shares—up 50% this year, better than AAPL—are still cheap. 

Emerging Markets: China’s onshore bond market is opening up rapidly amid Beijing’s financial reforms, and global and emerging market indexes are expanding to include Chinese bonds. 

Commodities: “Gold has outperformed mining shares so far this year, but the tide may turn in coming months if mining companies report strong results and optimism rises over the outlook for precious-metals prices.”