wall street – Beacon at Bangsar http://beaconatbangsar.com/ Wed, 16 Mar 2022 12:20:34 +0000 en-US hourly 1 https://wordpress.org/?v=5.9.3 https://beaconatbangsar.com/wp-content/uploads/2021/03/cropped-icon-32x32.png wall street – Beacon at Bangsar http://beaconatbangsar.com/ 32 32 First Community Co. (NASDAQ:FCCO) Expected to Report Quarterly Sales of $14.21 Million https://beaconatbangsar.com/first-community-co-nasdaqfcco-expected-to-report-quarterly-sales-of-14-21-million/ Sun, 13 Mar 2022 06:11:15 +0000 https://beaconatbangsar.com/first-community-co-nasdaqfcco-expected-to-report-quarterly-sales-of-14-21-million/

Analysts are predicting First Community Co. (NASDAQ:FCCO – Get Rating) to post $14.21 million in revenue for the current quarter, according to Zacks Investment Research. Three analysts have released estimates of First Community’s earnings, with estimates ranging from $14.20 million to $14.23 million. First Community recorded sales of $13.86 million in the same quarter last year, which would indicate a positive growth rate of 2.5% year over year. The company is expected to release its next quarterly earnings report on Wednesday, April 20.

On average, analysts expect First Community to report annual sales of $59.02 million for the current year, with estimates ranging from $58.67 million to $59.20 million. For the next fiscal year, analysts expect the company to record sales of $63.44 million, with estimates ranging from $62.16 million to $64.36 million. Zacks sales calculations are an average based on a survey of research companies that cover First Community.

First Community (NASDAQ:FCCO – Get Rating) last released its results on Wednesday, January 19. The bank reported earnings per share (EPS) of $0.52 for the quarter, beating the Zacks consensus estimate of $0.49 by $0.03. First Community had a return on equity of 11.32% and a net margin of 25.18%.

(A d)

Decision makers are finally waking up to the powerful medicinal properties of herbal medicines and Ei.Ventures is working to lead that charge.

A number of research companies have weighed in on FCCO recently. Zacks Investment Research downgraded shares of First Community from a “buy” rating to a “hold” rating in a Friday, Jan. 21 research note. Raymond James downgraded First Community shares from an “outperforming” rating to a “market performing” rating in a Thursday, Jan. 20, research note. Finally, StockNews.com began covering First Community stocks in a research note on Thursday. They issued a “hold” rating on the stock.

A number of hedge funds have recently increased or reduced their stake in FCCO. Royal Bank of Canada increased its stake in First Community shares by 167.0% in the second quarter. Royal Bank of Canada now owns 1,781 shares of the bank valued at $36,000 after purchasing an additional 1,114 shares during the period. CWM LLC purchased a new stake in First Community stock in the fourth quarter worth approximately $78,000. Two Sigma Advisers LP purchased a new stake in First Community stock in the third quarter worth approximately $257,000. Goldman Sachs Group Inc. increased its stake in First Community shares by 46.8% in the second quarter. Goldman Sachs Group Inc. now owns 17,709 shares of the bank valued at $358,000 after purchasing an additional 5,642 shares during the period. Finally, Ancora Advisors LLC increased its stake in First Community shares by 20.7% in the third quarter. Ancora Advisors LLC now owns 30,865 shares of the bank valued at $611,000 after purchasing an additional 5,300 shares during the period. Institutional investors hold 51.60% of the company’s shares.

FCCO opened at $21.25 on Friday. The stock has a fifty-day moving average of $20.88 and a 200-day moving average of $20.59. The company has a market capitalization of $160.31 million, a P/E ratio of 10.37 and a beta of 0.64. First Community has a 12 month minimum of $18.00 and a 12 month maximum of $23.42. The company has a quick ratio of 0.68, a current ratio of 0.69 and a debt ratio of 0.11.

The company also recently declared a quarterly dividend, which was paid on Tuesday, February 15. Shareholders of record on Tuesday, February 1 received a dividend of $0.13 per share. This represents a dividend of $0.52 on an annualized basis and a yield of 2.45%. This is a boost from First Community’s previous quarterly dividend of $0.12. The ex-dividend date was Monday, January 31. First Community’s dividend payout ratio is 25.37%.

First Community Company Profile (Get an assessment)

First Community Corp. is a bank holding company that provides commercial banking services through its subsidiary, First Community Bank. It operates through the following segments: Commercial and Retail Banking, Mortgage Banking, Investment Advisory and Non-Depository, and Corporate.

Featured articles

Get a free copy of Zacks‘ research report on First Community (FCCO)

For more information on Zacks Investment Research’s research offerings, visit Zacks.com

Earnings history and estimates for the first community (NASDAQ:FCCO)

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in First Community right now?

Before you consider First Community, you’ll want to hear this.

MarketBeat tracks Wall Street’s top-rated, top-performing research analysts daily and the stocks they recommend to their clients. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market takes off…and First Community wasn’t on the list.

While First Community currently has a “Hold” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> BRP (NASDAQ:DOOO) Sets New 1-Year Low on Analyst Downgrade https://beaconatbangsar.com/brp-nasdaqdooo-sets-new-1-year-low-on-analyst-downgrade/ Sat, 05 Mar 2022 16:24:13 +0000 https://beaconatbangsar.com/brp-nasdaqdooo-sets-new-1-year-low-on-analyst-downgrade/

Shares of BRP Inc. (NASDAQ:DOOO – Get Rating) hit a fresh 52-week low midday on Friday after National Bank Financial lowered its price target on the stock from C$128.00 at CA$124.00. The stock traded as low as $66.27 and last traded at $66.30, with a volume of 1171 shares traded. The stock previously closed at $69.31.

Other research analysts have also recently published research reports on the stock. CIBC raised its price target on BRP shares from C$134.00 to C$135.00 and gave the stock an “outperform” rating in a Thursday, Dec. 2 research report. Scotiabank assumed coverage from BRP in a research report on Friday, Dec. 17. They issued an “outperformance” rating on the stock. National Bankshares lowered its price target on BRP from CA$135.00 to CA$131.00 and set an “outperform” rating for the stock in a Wednesday, November 24 research note. Zacks Investment Research upgraded BRP from a “sell” rating to a “hold” rating in a Friday, Dec. 3 research note. Finally, they raised their target price on BRP shares from C$125.00 to C$130.00 and gave the stock a “buy” rating in a Thursday, Dec. 2 research note. One research analyst has assigned the stock a hold rating, fifteen have issued a buy rating and one has assigned the company a strong buy rating. According to data from MarketBeat, the company currently has a consensus rating of “Buy” and a consensus price target of $133.14.

Hedge funds have recently changed their stakes in the company. Mackenzie Financial Corp increased its stake in BRP shares by 20.2% in the fourth quarter. Mackenzie Financial Corp now owns 5,746,540 shares of the company valued at $503,373,000 after purchasing an additional 966,038 shares during the period. FIL Ltd increased its stake in BRP by 42.0% in the third quarter. FIL Ltd now owns 1,617,904 shares of the company valued at $149,757,000 after acquiring an additional 478,167 shares in the last quarter. Artemis Investment Management LLP increased its position in BRP by 6.6% in the fourth quarter. Artemis Investment Management LLP now owns 733,009 shares of the company worth $64,297,000 after acquiring an additional 45,171 shares during the period. FMR LLC increased its stake in BRP by 700.7% during the first quarter. FMR LLC now owns 655,115 shares of the company worth $18,178,000 after acquiring an additional 573,296 shares in the last quarter. Finally, Morgan Stanley increased its stake in BRP by 40.6% during the second quarter. Morgan Stanley now owns 547,611 shares of the company worth $42,912,000 after acquiring an additional 158,122 shares in the last quarter. 53.84% of the shares are currently held by institutional investors.

(A d)

Small cap stocks – and penny stocks in particular – tend to march to the beat of their own beater.

Low-priced, “penny” stocks like these offer a great way to make money regardless of the direction of the markets as a whole…

Click here to see how you can get the names and stock symbols of the four penny stocks.

The company has a market capitalization of $5.35 billion, a price-earnings ratio of 9.02 and a beta of 2.70. The company has a 50-day moving average price of $79.62 and a 200-day moving average price of $85.15.

BRP (NASDAQ:DOOO – Get Rating) last released its quarterly earnings data on Wednesday, December 1. The company reported earnings per share (EPS) of $1.48 for the quarter, beating the consensus estimate of $0.94 by $0.54. The company posted revenue of $1.59 billion for the quarter, compared to analysts’ estimates of $1.76 billion. BRP had a net margin of 11.90% and a negative return on equity of 223.71%. During the same period of the previous year, the company achieved EPS of $1.60. Research analysts predict that BRP Inc. will post earnings per share of 7.41 for the current year.

BRP Company Profile (NASDAQ: DOOO)

BRP, Inc is a holding company engaged in the design, development, manufacture, distribution and marketing of powersports vehicles and marine products. The Company operates through Powersports and Marine segments. The Powersports segment includes year-round products, seasonal products, and PA&A and OEM engines for powersports.

Featured articles

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in BRP right now?

Before you consider BRP, you’ll want to hear this.

MarketBeat tracks Wall Street’s top-rated, top-performing research analysts daily and the stocks they recommend to their clients. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market goes big…and BRP wasn’t on the list.

Although BRP currently has a “Buy” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> Sunrun Inc. (NASDAQ:RUN) Expected to Post Quarterly Sales of $390.04 Million https://beaconatbangsar.com/sunrun-inc-nasdaqrun-expected-to-post-quarterly-sales-of-390-04-million/ Wed, 02 Mar 2022 08:12:04 +0000 https://beaconatbangsar.com/sunrun-inc-nasdaqrun-expected-to-post-quarterly-sales-of-390-04-million/

Brokers expect Sunrun Inc. (NASDAQ:RUN – Get Rating) to post sales of $390.04 million for the current quarter, according to Zacks. Six analysts released Sunrun earnings estimates. The highest sales estimate is $421.90 million and the lowest is $346.04 million. Sunrun recorded sales of $334.79 million in the same quarter last year, suggesting a positive year-over-year growth rate of 16.5%. The company is expected to announce its next results on Wednesday, May 4.

On average, analysts expect Sunrun to report annual sales of $1.75 billion in the current fiscal year, with estimates ranging from $1.60 billion to $1.91 billion. For next year, analysts expect the company to register sales of $2.00 billion, with estimates ranging from $1.80 billion to $2.23 billion. Zacks sales averages are an average average based on a survey of research companies that track Sunrun.

Sunrun (NASDAQ:RUN – Get Rating) last released its quarterly earnings data on Thursday, February 17. The energy company reported ($0.19) EPS for the quarter, missing analyst consensus estimates of $0.10 per ($0.29). Sunrun had a negative net margin of 4.93% and a negative return on equity of 0.70%. During the same period of the previous year, the company posted ($0.06) EPS.

(A d)

Last year, the Fed claimed that inflation was transitory. Well, now we know that wasn’t true. And the Americans are paying dearly for it. Discover a little-known opportunity that savvy investors have used for the past 20 years.

Several analysts have published reports on the company. Piper Sandler cut her price target on Sunrun from $77.00 to $57.00 in a Friday, January 7 report. Royal Bank of Canada cut its price target on Sunrun from $81.00 to $79.00 and set an “outperform” rating for the company in a Friday, November 5 report. Evercore ISI reissued a “buy” rating and set a price target of $75.00 on Sunrun shares in a report on Friday, February 18. TheStreet downgraded Sunrun from a “c-” rating to a “d+” rating in a Monday, December 20 report. Finally, Zacks Investment Research downgraded Sunrun from a “buy” rating to a “hold” rating in a Thursday, Nov. 4, research rating. Two analysts gave the stock a hold rating and eighteen gave the company a buy rating. Based on data from MarketBeat.com, the company currently has a consensus rating of “Buy” and an average target price of $63.72.

In related news, insider Jeanna Steele sold 782 shares of Sunrun in a trade dated Friday, Dec. 17. The stock was sold at an average price of $33.85, for a total value of $26,470.70. The sale was disclosed in a document filed with the Securities & Exchange Commission, accessible via this link. Additionally, COO Christopher Dawson sold 9,875 shares of Sunrun in a trade dated Wednesday, December 15. The stock was sold at an average price of $33.39, for a total value of $329,726.25. The disclosure of this sale can be found here. During the last quarter, insiders sold 30,136 shares of the company worth $954,953. Insiders of the company hold 4.40% of the shares of the company.

Several institutional investors have recently bought and sold shares of RUN. BlackRock Inc. increased its stake in Sunrun shares by 14.8% during the fourth quarter. BlackRock Inc. now owns 29,631,513 shares of the energy company worth $1,016,363,000 after purchasing an additional 3,814,952 shares during the period. Viking Global Investors LP increased its stake in Sunrun to 97.1% in the third quarter. Viking Global Investors LP now owns 8,800,183 shares of the energy company valued at $387,208,000 after buying an additional 4,336,069 shares last quarter. BNP PARIBAS ASSET MANAGEMENT Holding SA increased its stake in Sunrun by 10.1% in the fourth quarter. BNP PARIBAS ASSET MANAGEMENT Holding SA now owns 8,432,752 shares of the energy company valued at $289,243,000 after buying an additional 772,818 shares last quarter. BNP Paribas Asset Management Holding SA increased its stake in Sunrun by 55.8% in the third quarter. BNP Paribas Asset Management Holding SA now owns 7,659,934 shares of the energy company valued at $337,037,000 after buying an additional 2,742,575 shares last quarter. Finally, State Street Corp increased its stake in Sunrun shares by 3.8% during the 4th quarter. State Street Corp now owns 6,644,379 shares of the energy company worth $227,902,000 after buying an additional 244,354 shares last quarter. 98.02% of the shares are currently held by institutional investors and hedge funds.

Sunrun stock opened at $28.13 on Wednesday. The stock has a market capitalization of $5.86 billion, a PE ratio of -70.32 and a beta of 2.14. The company has a debt ratio of 0.95, a quick ratio of 1.03 and a current ratio of 1.53. Sunrun has a one-year low of $18.61 and a one-year high of $68.88. The stock has a fifty-day moving average of $27.92 and a 200-day moving average of $40.19.

Sunrun Company Profile (Get a rating)

SunRun, Inc. is engaged in the design, development, installation, sale, ownership and maintenance of residential solar energy systems. It sells solar service offerings and installs solar power systems for homeowners through its direct-to-consumer channel. The company also offers plans such as monthly lease, full amount lease, purchase system and monthly loan.

Read more

Get a Free Copy of Zacks Research Report on Sunrun (RUN)

For more information on Zacks Investment Research’s research offerings, visit Zacks.com

Earnings history and estimates for Sunrun (NASDAQ:RUN)

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in Sunrun right now?

Before you consider Sunrun, you’ll want to hear this.

MarketBeat tracks Wall Street’s top-rated, top-performing research analysts daily and the stocks they recommend to their clients. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market takes off…and Sunrun wasn’t on the list.

Although Sunrun currently has a “Buy” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> Fairfax stock is a buy after reporting its best year https://beaconatbangsar.com/fairfax-stock-is-a-buy-after-reporting-its-best-year/ Mon, 21 Feb 2022 09:14:00 +0000 https://beaconatbangsar.com/fairfax-stock-is-a-buy-after-reporting-its-best-year/

Welcome Inside/iStock via Getty Images

Fairfax (OTCPK: FRFHF) was one of my top holdings for almost four years, and during that time it was a lousy investment. Prem Watsa, the once-legendary value investor, had to clean up some stupid mistakes, but Fairfax still couldn’t regain investor confidence.

Figure 1 shows the strong underperformance of FRFHF against the S&P 500 index measured during my early purchases of the company.

Fig. 1

Fairfax stock price performance against the S&P 500

BAML and author’s calculations

The guilty? Poor investments and a difficult interest rate environment.

blackberry (NYSE:BB), Greece, inflation hedges, short markets, new African consumer banks. They have all eaten away at the insurance company’s book value, while its portfolio of fixed-income assets continues to languish at rates near zero.

Figure 2 presents the investment performance of FRFHF broken down over several time periods. In the early days of the business, it can be seen that the investments performed well. But in recent years, performance has been mediocre at best.

Figure 2

Growth in book value per share, average combined ratio, investment performance

Fairfax Annual Report 2020

Over the past decade, FRFHF has struggled to reach 5% on its investment portfolio, while the S&P 500 has steadily hit new highs, fueled by growth and technology stocks. This led to below-average growth in book value well below its self-imposed target of 15% per year.

This year, however, Fairfax posted record performances for its 36-year history on nearly every key metric:

  • $26.5 billion in revenue up 34% over the previous year
  • 3.4 billion USD in net profit up almost 15 times from the previous year
  • 15 billion USD in equity, up 20% compared to the previous year
  • Consolidated combined ratio: 95% less than 97.8% the previous year

The real question now is: what is the next step? Does this performance mark the long-awaited turning point for stocks or another false start for this Berkshire (NYSE: BRK.A) desire? Let’s first look at the core business of the company: insurance to better understand the management of tomorrow.

The driving force: insurance

Fairfax has spent years building a global insurance platform and creating a conservative underwriting culture. From 1985 to 2021, global premiums grew at a compound rate of 23% to nearly $23 billion or $1,000 per share.

At the same time, the average combined ratio of its insurance portfolio continued to decline. In Figure 2, from 1986 to 1990, the company had an average consolidated combined ratio of 106.7%. Over the past five years, its average consolidated combined ratio has been 98.7% with a median of 97.3%.

Combined ratios are a key measure of the profitability of insurance companies. They measure expected insurance losses plus underwriting costs relative to earned premiums. The lower the combined ratio, the more profitable the insurance company.

They are also an important indication of whether insurance float or premiums collected but not yet paid have a cost. Profitable underwriting for insurance companies, as in the case of Fairfax, means that the returns on investment all go to shareholders.

Figure 3

2017-2021 annual combined ratios for Fairfax Insurance

Fairfax Annual Reports

We can see in Figure 3 that Fairfax has significantly improved its combined ratio from 106.6% in 2017 to 95% in 2021. The difficult market conditions, when insurance companies have the power to raise prices , certainly helped. Gross written premiums at Fairfax increased 25% to $23.9 billion in 2021 from a year ago.

Expect these conditions to persist in the form of social inflation or a tendency for juries to award higher amounts to plaintiffs; disasters crowd out weak carriers; and rising general inflation to conspire for a hard market.

Despite these positive developments, Fairfax investors should beware of some difficult to quantify risks.

Climate change and its impact on weather conditions can put pressure on (re)insurance companies. The view that there will be more frequent, severe and unexpected weather disasters cannot be ignored. For example, Fairfax’s explosive year included another $1.1 billion in catastrophe losses, reducing its combined ratio by 7.2 points; excluding catastrophes, the combined ratio would have been 87.8%!

But that’s why a cautious and adaptive underwriting culture is needed, and I haven’t seen anything to suggest that Fairfax won’t adapt to these new climate realities. Investors, however, should take note of the progress the company has made here.

In addition, the ongoing conflict between Ukraine and Russia could negatively impact Fairfax’s European insurance business. In 2020, the company wrote gross premiums of USD 144 million in Ukraine and USD 114 million in Poland. Brit, which is a UK-based insurer, paid 13% of gross premiums that year.

Inflation will be good for Fairfax

Inflation has been an afterthought in the developed world for more than a decade, but the global pandemic has raised concerns among central bankers about runaway prices. Self-imposed lockdowns and workers reluctant to re-enter the labor market have put enormous pressure on global supply chains, causing consumer prices to rise rapidly.

The US consumer price index, for example, rose 7.5% year-on-year in January, the biggest 12-month increase since 1982. Wall Street, therefore, is forecasting up to seven rate hikes by the US Federal Reserve, while the Bank of Canada could quickly follow suit.

The insurance industry has long suffered from low rates, as their portfolios typically have a large portion of bonds to cover claims. But in a prescient move, Fairfax kept its portfolio short-term by keeping about 50% of its $43 billion in assets invested in cash and short-term instruments.

This means that as rates rise, his portfolio will be more resilient to changes in market value, as longer-dated fixed income instruments are discounted relative to better-priced ones.

Short duration assets do not face the same volatility in rising rate environments. Fairfax may also use its cash to purchase bonds and fixed income instruments when rates better reflect the credit risk being taken. A significant development since interest and dividends represented 28% of (re)insurance operating income in 2021.

Is Mr. Watsa finally giving the floor on share buybacks?

Mr Watsa has been chipping away at the company’s share count since 2018, reducing outstanding shares by an unimpressive 6% through 2020. But in a surprising year-end move, Fairfax launched a buyout of $1 billion primarily using proceeds from a sale of a minority stake in his wholly owned insurance unit of the Odyssey Group.

It was a decision Watsa had been hinting at for a while.

In his 2018 annual letter he wrote about Teledyne’s late great Henry Singleton (NYSE: TDY) fame, which retired 90% of Teledyne shares and generated a 3,000% return for shareholders during this period. Clearly, Watsa still has a long way to go to equal that record, but a stock cut of around 7% isn’t a bad start!

But the transaction was interesting beyond the mere merits of the takeover. It also gave watchful shareholders a window into the company’s undervaluation.

For $900 million, the Canada Pension Plan Investment Board and OMERS purchased a total of 9.99% or 4.995% each of Odyssey Group, the reinsurance and specialty insurance business of the Stamford, CT-based company.

This valued the unit at over $9 billion, or 1.83 times what Fairfax held for the Odyssey Group in 2020 ($4.9 billion in equity attributed to Odyssey).

How does this compare to the set?

Fairfax total common shareholders’ equity was $15 billion at the end of 2021, and the market capitalization of the entire company traded at $13.4 billion recently. The true value of the Odyssey Group was then a startling 60% of book value and 67% of market value.

When you consider Fairfax’s other attractive insurance properties, private business interests and controlling positions in Fairfax India and Africa, it is clear that the intrinsic value of the company is far greater than where the shares are listed today. today.

In sum

It can be silly to predict where the stock price will go next. I certainly didn’t have a crystal ball four years ago when I created my job at Fairfax and prices were languishing. But I continue to hold my stocks and buy on the downside taking comfort in Benjamin Graham’s mantra:

In the short term, the market is a voting machine but in the long term, it is a weighing machine.

Fairfax has been in the best shape for years.

The company’s (re)insurance operations are profitable, improving and thriving in a tough market that looks set to continue. Higher interest rates will allow the team to improve its interest income, a long thorn in investment performance. And it seems clear from the sale of the Odyssey Group’s stake that the Fairfax pieces aren’t getting the credit they deserve.

I suspect Mr. Watsa is closing the intrinsic value gap with accretive buyouts and creative financing that “weight” will be on the rise as the market begins to realize the value of this undervalued company.

]]>
PCB Bancorp (NASDAQ:PCB) sees a significant drop in short-term interest https://beaconatbangsar.com/pcb-bancorp-nasdaqpcb-sees-a-significant-drop-in-short-term-interest/ Mon, 14 Feb 2022 12:21:33 +0000 https://beaconatbangsar.com/pcb-bancorp-nasdaqpcb-sees-a-significant-drop-in-short-term-interest/

PCB Bancorp Inc (NASDAQ:PCB) benefited from a sharp decline in short interest in January. As of January 31, there was selling interest totaling 118,300 shares, down 39.5% from the total of 195,400 shares as of January 15. Based on an average daily volume of 50,600 shares, the day-to-cover ratio is currently 2.3 days. Currently, 1.0% of the stock’s shares are sold short.

PCB has been the subject of several recent analyst reports. Zacks Investment Research upgraded PCB Bancorp from a “hold” rating to a “buy” rating and set a target price of $25.00 on the stock in a Wednesday, Feb. 2 research note. Raymond James raised its price target on PCB Bancorp from $21.00 to $24.00 and gave the stock an “outperform” rating in a Monday, November 1 research note.

Separately, director Sang Young Lee purchased 10,300 shares of the company in a transaction that took place on Friday, November 26. The stock was purchased at an average price of $22.09 per share, for a total transaction of $227,527.00. The acquisition was disclosed in a filing with the SEC, which is available on the SEC’s website. Additionally, director Daniel Cho sold 7,597 shares of the company in a trade that took place on Thursday, February 3. The shares were sold at an average price of $23.82, for a total value of $180,960.54. The disclosure of this sale can be found here. Insiders purchased a total of 27,350 shares of the company valued at $608,974 during the last quarter. Insiders of the company own 22.54% of the shares of the company.

(A d)

This company aims to delay aging and now has an exciting Phase 2 trial on the way!

A number of institutional investors and hedge funds have recently increased or reduced their stakes in the stock. Dimensional Fund Advisors LP increased its position in PCB Bancorp shares by 54.2% during the second quarter. Dimensional Fund Advisors LP now owns 115,900 shares of the company valued at $1,866,000 after purchasing an additional 40,757 shares during the period. Jump Financial LLC bought a new position in PCB Bancorp stock during the second quarter worth approximately $214,000. Ancora Advisors LLC purchased a new position in PCB Bancorp stock during the second quarter valued at approximately $1,008,000. Renaissance Technologies LLC increased its position in PCB Bancorp shares by 44.6% during the second quarter. Renaissance Technologies LLC now owns 79,276 shares of the company valued at $1,276,000 after purchasing an additional 24,444 shares during the period. Finally, Marshall Wace LLP purchased a new position in PCB Bancorp stock during the second quarter worth approximately $845,000. Institutional investors hold 37.38% of the company’s shares.

NASDAQ: PCB opened at $24.52 on Monday. The company has a current ratio of 1.05, a quick ratio of 1.04 and a debt ratio of 0.04. The company’s 50-day simple moving average is $22.80. The company has a market capitalization of $363.93 million, a PE ratio of 9.36 and a beta of 0.85. PCB Bancorp has a 52-week low of $13.22 and a 52-week high of $26.04.

PCB Bancorp Inc (NASDAQ:PCB) last released its results on Thursday, January 27. The company reported earnings per share (EPS) of $0.70 for the quarter, beating Thomson Reuters consensus estimate of $0.64 by $0.06. PCB Bancorp had a return on equity of 16.55% and a net margin of 40.14%. The company had revenue of $24.93 million for the quarter. As a group, research analysts expect PCB Bancorp to post EPS of 2.15 for the current year.

The company also recently announced a quarterly dividend, which will be paid on Friday, February 18. Shareholders of record on Friday, February 11 will receive a dividend of $0.15. This represents an annualized dividend of $0.60 and a dividend yield of 2.45%. This is a boost from PCB Bancorp’s previous quarterly dividend of $0.12. The ex-date of this dividend is Thursday, February 10. PCB Bancorp’s payout rate is 22.90%.

Bancorp PCB Company Profile

PCB Bancorp operates as a bank holding company for Pacific City Bank which provides various banking products and services to individuals and small and medium businesses in Southern California. The company offers demand, savings, money market and term deposits, as well as certificates of deposit; and remote deposit capture, courier deposit services, positive pay services, zero balance accounts and transfer accounts.

Recommended Stories

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in PCB Bancorp right now?

Before you consider PCB Bancorp, you’ll want to hear this.

MarketBeat tracks daily the highest rated and most successful research analysts on Wall Street and the stocks they recommend to their clients. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market takes hold…and PCB Bancorp was not on the list.

Although PCB Bancorp currently has a “Buy” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> Jerash Holdings (US) (NASDAQ:JRSH) Reports Quarterly Earnings, Beats Expectations by $0.03 EPS https://beaconatbangsar.com/jerash-holdings-us-nasdaqjrsh-reports-quarterly-earnings-beats-expectations-by-0-03-eps/ Sat, 12 Feb 2022 18:46:13 +0000 https://beaconatbangsar.com/jerash-holdings-us-nasdaqjrsh-reports-quarterly-earnings-beats-expectations-by-0-03-eps/

Jerash Holdings (US) (NASDAQ:JRSH) announced its quarterly results on Thursday. The company reported EPS of $0.13 for the quarter, beating Thomson Reuters consensus estimate of $0.10 by $0.03, MarketWatch Earnings reports. Jerash Holdings (US) posted a return on equity of 12.24% and a net margin of 5.96%. In the same quarter last year, the company posted EPS of $0.01. Jerash Holdings (US) has updated its Q4 2022 EPS guidance.

JRSH traded down $0.15 during Friday’s trading, hitting $6.65. The company’s stock had a trading volume of 1,350 shares, compared to an average volume of 14,378. The company’s 50-day moving average price is $6.53 and its 200-day moving average price is $7.09. The stock has a market capitalization of $82.02 million, a PE ratio of 10.62 and a beta of 0.75. Jerash Holdings has a 12-month low of $5.75 and a 12-month high of $9.20.

The company also recently declared a quarterly dividend, which will be paid on Tuesday, February 22. Shareholders of record on Tuesday, February 15 will receive a dividend of $0.05. The ex-dividend date is Monday, February 14. This represents an annualized dividend of $0.20 and a yield of 3.01%. The dividend payout ratio (DPR) of Jerash Holdings (USA) is currently 31.75%.

A hedge fund recently increased its stake in the shares of Jerash Holdings (USA). Dimensional Fund Advisors LP increased its holdings in Jerash Holdings (US), Inc. (NASDAQ:JRSH) by 22.0% in Q4, according to its latest 13F filing with the SEC. The fund held 21,111 shares of the company after acquiring an additional 3,812 shares during the period. Dimensional Fund Advisors LP held 0.17% of Jerash Holdings (US) worth $137,000 at the end of the most recent reporting period. 2.96% of the shares are currently held by hedge funds and other institutional investors.

(A d)

This guide will help you identify and execute an options trading strategy that fits your specific needs and risk profile.

Take your trading to the next level with the Options Strategy Guide.

JRSH has been the subject of several research reports. Lake Street Capital raised its price target on Jerash Holdings (US) from $9.00 to $12.00 in a research report on Friday. Zacks Investment Research upgraded Jerash Holdings (US) from a “sell” to a “hold” rating in a Tuesday, January 18 research report. Finally, Aegis reiterated a “buy” rating on Jerash Holdings (US) shares in a Monday, November 15 research report. One equity research analyst gave the stock a hold rating and three gave the company a buy rating. Based on data from MarketBeat.com, the stock currently has a consensus rating of “Buy” and an average target price of $10.44.

Company Profile Jerash Holdings (USA)

Jerash Holdings (US), Inc operates as a holding company. It manufactures custom readymade outerwear from knitted fabrics and exports produced garments for retailers such as Walmart, Costco, Sears, Hanes, Columbia, Land’s End, VF Corp. and Philip-Van Heusen. The company offers pants and outerwear in urban style and different types of natural and synthetic materials.

See also

Earnings history for Jerash Holdings (US) (NASDAQ: JRSH)

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in Jerash Holdings (US) right now?

Before you consider Jerash Holdings (USA), you’ll want to hear this.

MarketBeat tracks daily the highest rated and most successful research analysts on Wall Street and the stocks they recommend to their clients. MarketBeat identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market goes higher…and Jerash Holdings (US) was not on the list.

While Jerash Holdings (US) currently has a “Buy” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> Column: Historic central bank drain questions ‘buy the dip’ https://beaconatbangsar.com/column-historic-central-bank-drain-questions-buy-the-dip/ Thu, 10 Feb 2022 09:28:00 +0000 https://beaconatbangsar.com/column-historic-central-bank-drain-questions-buy-the-dip/

A US 100 dollar bill is seen on December 17, 2009.

Join now for FREE unlimited access to Reuters.com

ORLANDO, Fla., Feb 9 (Reuters) – The odds that investors will avoid a rare year of stock declines are diminishing as central banks prepare to undertake the biggest liquidity drain in history.

The US Federal Reserve, European Central Bank and Bank of England are signaling a reversal in emergency monetary settings in the event of a pandemic. The combination of higher interest rates, a halt to bond purchases and a possible reduction in their bloated balance sheets will sap billions of dollars of liquidity from global markets over the next 12 months and beyond. .

How well historically high stock prices can absorb this shock is the investment question of the year.

Join now for FREE unlimited access to Reuters.com

Morgan Stanley analysts estimate that G4 central banks will drain $2.2 trillion of liquidity from the global financial system over 12 months, in what they called “the largest quantitative tightening in history.”

They estimate that the G4 central bank’s combined balance sheet will peak in May and that the $2.2 trillion cut will be more than four times the $500 billion drained in the last “quantitative tightening” attempt in 2018.

Morgan Stanley

It is worth noting. Global stocks fell 20% from peak to trough that year as the Fed raised rates and began shrinking its balance sheet. The eventual toll on the markets has forced the Fed to put these particular policy tools back in their box.

Could a 20% drop – technically ushering in a bear market – be on the cards this year? With the Fed under political pressure to control inflation and play politics for Main Street rather than Wall Street, and with BoE and even ECB tightening now on the table, this is a credible prospect.

Citi strategist Matt King notes that while the relationship between central bank liquidity and financial markets in the months ahead is as strong as it has been over the past decade, stocks and other markets are vulnerable.

G4 central banks expanded their balance sheets by $8 trillion in 2020 and another $3 trillion last year. Their overall balance sheet is over $26 trillion.

Aggregate

It was jet fuel for last year’s equity boom, King says, which generated total returns of nearly 30% for the S&P 500. If it’s the relative change rather than the absolute level of liquidity that drives markets, removing even a fraction of post-pandemic support could be huge.

“It’s not a global arms race in terms of crunch, but there is an interconnection in their policies, which collectively creates a global movement. And that matters for risk assets,” King said.

“QE has produced a ‘rally of everything.’ At a minimum, that liquidity is no longer pushing everything higher. So logically, you should be worried about the risk of a ‘sell of everything,'” he adds. .

City
City

Others argue that the greatest impact on asset prices of quantitative easing or tightening is felt on the announcement, as investors react quickly to reassess expected levels of interest rates, earnings companies and valuations.

Admittedly, the minutes of the Fed’s December policy meeting released on Jan. 5 detailing the QT discussion dealt a major blow to market sentiment. Wall Street and global stocks fell about 10% before managing to halve those losses.

But if Citi’s King is correct that QE or QT won’t really hit the markets until the process begins and liquidity is actually added or removed, risky assets will experience a hotter period over the next two years.

Bank of America analysts estimate that the Fed’s balance sheet will shrink to 31% of GDP by the end of this year from 36% currently, while that of the ECB will shrink to 56% of GDP from 69% currently.

These are among the boldest predictions, but if correct, it could represent cash losses of up to $1.5 trillion and $2 trillion, respectively. These are huge sums, perhaps too large for the markets.

(Views expressed here are those of the author, columnist for Reuters.)

Join now for FREE unlimited access to Reuters.com

By Jamie McGeever; Editing by Andrea Ricci

Our standards: The Thomson Reuters Trust Principles.

]]>
$1.30 billion in sales expected for The Western Union Company (NYSE:WU) this quarter https://beaconatbangsar.com/1-30-billion-in-sales-expected-for-the-western-union-company-nysewu-this-quarter/ Sun, 30 Jan 2022 06:45:00 +0000 https://beaconatbangsar.com/1-30-billion-in-sales-expected-for-the-western-union-company-nysewu-this-quarter/

Wall Street analysts expect The Western Union Company (NYSE:WU) to post sales of $1.30 billion for the current fiscal quarter, Zacks reports. Five analysts have made estimates of Western Union’s earnings, with the lowest sales estimate of $1.28 billion and the highest estimate of $1.31 billion. Western Union posted sales of $1.27 billion in the same quarter last year, suggesting a positive year-over-year growth rate of 2.4%. The company is expected to release its next results after the market closes on Thursday, February 10.

According to Zacks, analysts expect Western Union to report annual revenue of $5.08 billion in the current fiscal year, with estimates ranging from $5.06 billion to $5.10 billion. of dollars. For next year, analysts expect the company to post sales of $5.23 billion, with estimates ranging from $5.00 billion to $5.39 billion. Zacks sales averages are an average average based on a survey of sell-side analysts who cover Western Union.

Western Union (NYSE:WU) last released its quarterly results on Monday, November 1. The credit services provider reported earnings per share of $0.63 for the quarter, beating the consensus estimate of $0.58 by $0.05. The company posted revenue of $1.29 billion in the quarter, versus $1.31 billion expected by analysts. Western Union achieved a return on equity of 311.01% and a net margin of 16.10%. In the same quarter last year, the company posted EPS of $0.57.

A number of equity research analysts have recently released reports on WU shares. Credit Suisse Group lowered its price target on Western Union from $23.00 to $19.00 and set an “underperform” rating for the company in a Wednesday, Nov. 3 research note. Susquehanna cut its price target on Western Union from $23.00 to $21.00 and set a “neutral” rating on the stock in a Wednesday, Nov. 3, report. Northland Securities cut its price target on Western Union from $32.00 to $25.00 and set an “outperform” rating on the stock in a Wednesday, Nov. 3, report. Citigroup lowered its target price on Western Union from $25.00 to $24.00 and placed a “buy” rating on the stock in a research note on Wednesday. Finally, Deutsche Bank Aktiengesellschaft lowered its price target on Western Union from $25.00 to $18.00 and placed a “hold” rating on the stock in a Wednesday, Nov. 3 research note. Four research analysts gave the stock a sell rating, seven gave the company a hold rating and two gave the company a buy rating. According to data from MarketBeat, the stock has a consensus rating of “Hold” and an average target price of $22.25.

(A d)

This guide will help you identify and execute an options trading strategy that fits your specific needs and risk profile.

Take your trading to the next level with the Options Strategy Guide.

Institutional investors have recently bought and sold shares of the company. BRITISH COLUMBIA INVESTMENT MANAGEMENT Corp increased its holdings of Western Union shares by 12.9% in the second quarter. BRITISH COLUMBIA INVESTMENT MANAGEMENT Corp now owns 76,113 shares of the credit service provider worth $1,748,000 after buying 8,699 more shares in the last quarter. Baird Financial Group Inc. acquired a new stake in Western Union stock during Q2 valued at approximately $2,565,000. Commonwealth Equity Services LLC increased its position in Western Union shares by 16.4% during the second quarter. Commonwealth Equity Services LLC now owns 33,770 shares of the credit services provider valued at $775,000 after acquiring an additional 4,762 shares during the period. Xponance Inc. increased its position in Western Union shares by 26.4% during the 2nd quarter. Xponance Inc. now owns 33,257 shares of the credit service provider valued at $764,000 after acquiring an additional 6,945 shares during the period. Finally, Jennison Associates LLC increased its position in Western Union shares by 152.9% during the second quarter. Jennison Associates LLC now owns 162,598 shares of the credit services provider worth $3,735,000 after purchasing an additional 98,304 shares in the last quarter. Institutional investors hold 98.87% of the company’s shares.

NYSE:WU opened at $18.84 on Friday. The company has a market capitalization of $7.57 billion, a price-earnings ratio of 9.52 and a beta of 0.95. Western Union has a 1-year low of $15.69 and a 1-year high of $26.61. The company has a 50-day simple moving average of $17.84 and a 200-day simple moving average of $19.83. The company has a debt ratio of 7.74, a current ratio of 0.93 and a quick ratio of 0.93.

The company also recently disclosed a quarterly dividend, which was paid on Friday, December 31. Shareholders of record on Friday, December 17 received a dividend of $0.235. This represents an annualized dividend of $0.94 and a dividend yield of 4.99%. The ex-dividend date was Thursday, December 16. Western Union’s payout rate is currently 47.47%.

Western Union Company Profile

The Western Union Co is a holding company that provides money transfer and payment services. It operates through the following segments: Consumer-to-Consumer; Business solutions; and other. The Consumer-to-Consumer segment facilitates money transfers between two consumers. The Business Solutions segment offers payment and foreign exchange solutions, cross-border and multi-currency transactions, for small and medium enterprises and other organizations and individuals.

Further reading: net income

Get a Free Copy of Zacks Research Report on Western Union (WU)

For more information on Zacks Investment Research’s research offerings, visit Zacks.com

Earnings history and estimates for Western Union (NYSE:WU)

This instant alert was powered by MarketBeat’s narrative science technology and financial data to provide readers with the fastest and most accurate reports. This story was reviewed by MarketBeat’s editorial team prior to publication. Please send questions or comments about this story to [email protected]

Should you invest $1,000 in Western Union right now?

Before you consider Western Union, you’ll want to hear this.

MarketBeat tracks Wall Street’s top-rated, top-performing research analysts daily and the stocks they recommend to their clients. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the market takes hold…and Western Union wasn’t on the list.

While Western Union currently has a “Hold” rating among analysts, top-rated analysts believe these five stocks are better buys.

See the 5 actions here

]]> Cuentas adds new features to mobile banking app https://beaconatbangsar.com/cuentas-adds-new-features-to-mobile-banking-app/ Tue, 25 Jan 2022 14:07:00 +0000 https://beaconatbangsar.com/cuentas-adds-new-features-to-mobile-banking-app/


Enter Wall Street with StreetInsider Premium. Claim your one week free trial here.


Get paid 2 days early via direct deposit. New products in the mobile app digital store.

MIAMI, FL/ACCESSWIRE/January 25 2022 / Cuentas, Inc. (NASDAQ: CUEN)(NASDAQ: CUENW) (“Cuentas”), a leading financial technology provider of mobile banking and payment solutions, has added several new features to its mobile banking application.

Available on the Apple App Store and Google Play Store, the Cuentas app is the convenient mobile banking app that gives consumers access to their money, whenever they want. In the latest version of the app, Cuentas offers cardholders more flexibility and convenience than ever before, with:

  • Access to payment 2 days earlier with direct deposit: Cuentas cardholders can now access their money up to two days faster when directly depositing their paychecks or government benefit checks.
  • Free P2P payments: Cuentas cardholders can send or request money directly to or from family and friends who are also cardholders directly from the Cuentas app. There are no charges for app-to-app transfers made on the Cuentas app.
  • More retail digital products with discounts in the Cuentas digital store: Exclusive for cardholders, Cuentas allows users to shop even more popular brands than ever before at discounted prices from the Cuentas digital store in the Cuentas app. Cardholders just click and save, and the app will automatically calculate and display each discount during the purchase process. Discounts can vary from 2% to 50%, depending on the product.

New features to manage money

App users can be notified whenever they send or receive money, view their transaction history at any time, and choose from other notification options to more easily manage the flow of funds directly in their Cuentas account.

Anyone 18 or older can download Cuentas app and ask for a card. There is no credit check or bank account required, and cardholders can register with an Individual Tax Identification Number (ITIN) or Social Security Number (SSN) and matrícula consular is also accepted as a form of secondary identification. It’s easy to load money to get started, learn more about cuentas.com.

“With these new features and products, we continue to improve the user experience for new and current Cuentas cardholders,” said Jeff Johnson, CEO of Cuentas. “These advancements should also provide stronger retention stats,” Johnson added.

About Cuentas

Cuentas, Inc. (NASDAQ:CUEN)(NASDAQ:CUENW) is a fintech e-commerce and banking services provider with proprietary technology that provides digital financial services to underbanked Hispanic, Latino and immigrant populations and unbanked, including mobile and online banking, prepaid debit, ACH and mobile deposits, cash back, peer-to-peer money transfer and other services. The Cuentas General Purpose Reloadable Card (GPR) includes a digital wallet, discounts for purchases at major physical and online retailers, rewards, and the ability to purchase digital content. For more information, visit https://cuentas.com.

Forward-looking statements

This press release contains “forward-looking statements”, as that term is defined in Section 27a of the United States Securities Act of 1933, as amended, and Section 21e of the United States Securities Exchange Act of 1934, as amended. The statements in this press release, which are not purely historical, are forward-looking statements and include all statements regarding beliefs, plans, expectations or intentions regarding the future. Except for historical information presented herein, the matters discussed in this press release contain forward-looking statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from any future results, performance or achievements expressed or implied by these statements. Statements that are not historical facts, including statements that are preceded, followed or that include words such as “believe”, “plan” or “expect” or similar statements, are forward-looking statements.

Investor Relations
Cuentas, Inc.
800-611-3622
info@cuentas.com

THE SOURCE: Cuentas, Inc.

See the source version on accesswire.com:
https://www.accesswire.com/685312/Cuentas-Adds-New-Features-to-Mobile-Banking-App

]]>
Is the market crashing? No. Here’s what’s happening to stocks, bonds as the Fed aims to end the days of easy money, analysts say https://beaconatbangsar.com/is-the-market-crashing-no-heres-whats-happening-to-stocks-bonds-as-the-fed-aims-to-end-the-days-of-easy-money-analysts-say/ Sat, 22 Jan 2022 23:03:00 +0000 https://beaconatbangsar.com/is-the-market-crashing-no-heres-whats-happening-to-stocks-bonds-as-the-fed-aims-to-end-the-days-of-easy-money-analysts-say/ As the stock market has fallen and bond yields have surged in recent weeks, culminating in a so-called correction in the Nasdaq Composite Index, average Americans are wondering what’s wrong with Wall Street.

Increasingly, Google searches have focused on the state of the market (and the economy), and for good reason.

The Dow Jones Industrial Average DJIA,
-1.30%
posted its worst weekly loss since October 2020 and the S&P 500 SPX,
-1.89%
and Nasdaq Composite COMP,
-2.72%
posted their worst weekly percentage declines since March 20, 2020, according to Dow Jones Market Data shows.

Read: First Federal Reserve meeting of 2022 looms as risk of inflation beyond policymakers’ control rises

Google searches included the following popular queries: Is the market collapsing? And why is the market collapsing?

What is a stock market crash?

Certainly, the market does not collapse insofar as the term “collapse” is even a quantifiable market condition. Declines in stocks and other assets are sometimes portrayed in hyperbolic terms that offer little real substance about the significance of the move.

There is no precise definition of an “accident”, but it is generally described in terms of duration, suddenness and/or severity.

Jay Hatfield, chief investment officer at Infrastructure Capital Management, told MarketWatch on Saturday that he could characterize a crash as a drop in an asset of at least 50%, which could happen quickly or over a year, but said recognized that the term is sometimes used too loosely to describe ordinary slowdowns. He saw Bitcoin’s BTCUSD,
-0.45%
move like an accident, for example.

He said the current global stock market crash by no means met his definition of a crash, but said stocks were in a fragile state.

“He doesn’t crash but he’s very weak,” Hatfield said.

What is happening?

Equity benchmarks are significantly recalibrated from high highs as the economy heads for a new monetary policy regime in the fight against the pandemic and soaring inflation. In addition to this, doubts about parts of the economy and events outside the country, such as China-US relations, the Russian-Ukrainian conflict and unrest in the Middle East, also contribute to a bearish tone or pessimistic to investors. .

The confluence of uncertainties has markets in or near a correction or heading into a bear market, which are terms that are used more accurately when discussing a market decline.

The recent decline in stocks, of course, is nothing new, but it may seem a little unsettling for new investors, and perhaps even for some veterans.

The Nasdaq Composite entered a correction last Wednesday, registering a drop of at least 10% from its recent peak on November 19, which is Wall Street’s commonly used definition of a correction. The Nasdaq Composite last entered a correction on March 8, 2021. On Friday, the Nasdaq Composite was up more than 14% from its November high and heading into a so-called bear market, generally described by the market techs like a drop of at least 20% from a recent high.

Meanwhile, blue-chip Dow industrials were 6.89% below their all-time high on Jan. 4, or 3.11 percentage points from a correction, as of Friday’s close; while the S&P 500 was down 8.31% from its January 3 high, putting it just 1.69 percentage points since entering a correction.

Also of note is the RUT Russell 2000 Small Cap Index,
-1.78%
was 18.6% from its recent peak.

The shift in bullish sentiment hinges on the Federal Reserve’s three-pronged approach to tighter monetary policy: 1) reduce market-friendly asset purchases, with a view to completing those purchases by March; 2) raise benchmark interest rates, which currently range between 0% and 0.25%, at least three times this year, based on market-based projections; 3) and shrinking its balance sheet by nearly $9 trillion, which grew significantly as the central bank sought to act as a safety net for markets during a March 2020 slump caused by the pandemic rocking the economy .

Taken together, the central bank’s tactics to fight a surge in high inflation would pull hundreds of billions of dollars of liquidity out of markets that have been awash with Fed funds and government fiscal stimulus during the pandemic.

Uncertainty about economic growth this year and the prospect of higher interest rates are forcing investors to revalue technology and high-growth stocks, whose valuations are particularly tied to the present value of their cash flows, as well as undermining speculative assets, including crypto. like bitcoin BTCUSD,
-0.45%
and Ether ETHUSD,
-0.38%
on the Ethereum blockchain.

“Excessive Fed liquidity has had the effect of inflating many asset classes, including meme stocks, unprofitable tech stocks, SPACs[special-purpose acquisition companies]and cryptocurrency,” Hatfield said.

He said that the rise in yields of the 10-year Treasury note TMUBMUSD10Y,
1.762%,
which climbed more than 20 basis points in 2022, marking the strongest advance at the start of a new year since 2009, is more a symptom of the expectation of a liquidity squeeze.

“Liquidity is the main driver, not interest rates, as almost all publicly traded stocks have roughly the same duration/interest rate sensitivity, so tech stocks are unaffected disproportionately by rate hikes, despite market comments to the contrary,” Hatfield said.

Either way, the Federal Open Market Committee responsible for setting rates will likely spend its Jan. 25-26 meeting laying the groundwork for another policy shift, which the market is trying to price into valuations.

How often does the market collapse

Investors should be forgiven for thinking that markets are only going up. The stock market has shown resilience, even during the pandemic.

Yet declines of 5% or more are common on Wall Street.

Sam Stovall, chief investment strategist at CFRA, said he viewed the current market drop as “a very typical drop.”

“Is it an accident? No. But it’s an average drop, believe it or not, it is,” he told MarketWatch over the weekend.

“I would say the market does what it does. A bull market goes up the escalator but bear markets go down the elevator, and as a result people are very scared when the market goes down,” he said.

Stovall prefers to categorize market declines by overall magnitude and does not offer specific criteria for a “crash”.

“[Declines of] zero to 5% I call noise, but the closer we get to 5% the louder the noise,” he said. He said a drop of 5-10% is considered a pullback, a drop of at least 10% is a correction for him, and a drop of 20% or more is a bear market.

Salil Mehta, a statistician and former director of analysis for the U.S. Treasury Department’s TARP program following the 2008 financial crisis, told MarketWatch that given the more than 8% decline in the S&P 500, the likelihood of a 10-14% decline from here is 31%, while there is a one in five chance of a total decline of 30% or more from current levels.

The statistician said there is “a similar probability that the current decline will eventually turn into something twice as large. And a similar probability that the current pullback will be over.

Stovall said it’s important to know that markets can rebound quickly from a downturn. He said it took the S&P 500 an average of 135 days to come to a peak-to-trough correction and only 116 days on average to break even based on data dating back to World War II.

Stovall says this slowdown may also be exacerbated by seasonal factors. The researcher said markets tend to fare poorly in a president’s second year in office. “We call it the second crisis,” he said.

“The volatility was 40% higher in the second year, compared to the other three years of the presidential term,” he said.

Stovall said another factor to consider is that markets tend to digest a lot after a year when returns have been 20% or more. The S&P 500 has posted a 26.89% gain in 2021 and is down 7.7% so far in 2022.

There were 20 other occasions when the S&P 500 index posted a gain of 20% or more over the calendar year and fell by at least 5% the following year. When such a drop, after a big gain the previous year, happened in the first half of the new year, and did so on 12 occasions, the market returned to equilibrium 100% of the time.

Stovall notes that this is not statistically significant but still noticeable.

What should investors do?

The best strategy in a downturn may be no strategy at all, but it all depends on your risk tolerance and time horizon. “Doing nothing is often the best strategy,” Hatfield said.

He also highlighted defensive sectors, such as consumer staples XLP,
+0.08%,
XLU utilities,
-0.19%
and XLE energy,
-1.98%,
which often pay healthy dividends and higher yielding investments like preferred stocks as a good option for investors looking to hedge against possibly greater volatility.

Financial experts normally warn against rash action, but they also say some Americans have more reason to worry than others, depending on their age and investment profile. An older person may want to discuss the situation with their financial advisor and a younger investor may be able to hold their own if they are comfortable with their current investment setup, strategists say.

Withdrawals can be opportunities for asset accumulation if an investor is careful and judicious in selecting their investments. However, slowdowns often result in hive thinking, with market players selling in droves.

Market declines “shake investor confidence and tend to drive more sales,” Hatfield said.

Ultimately, though, investors need to be careful and smart about how they think about the market, even in the face of so-called crashes.

]]>