- U.S Economy:
- U.S unemployment claims were up to 278000, but the increase is smaller than expected
- The U.S Economy Added 247,000 jobs in January, well above expectation
- Oil tumbled for the second day in a row, with the U.S benchmark slipping back below 50 a barrel.
- The ECB to stop accepting Greek debt as collateral
- China reported weaker than expected export(Downto 3.3%) and import data on Sunday, raising concern that China’s growth is slowing.
- Verizon: sell its wireless tower to American Tower for 5.1 bill and its local fixed line assets.
- Time Warner reported 1% decrease in revenue last quarter
- Apple’s market cap reaches 700 bill Giant as the first U.S Company with Market Cap exceeding 700 bill.
Porter’s Five Force
Porter’s Five forces is an analysis tool to analyze the competition level of a company. Here are the five forces:
- Easiness of entry for new participants
- Number and activity of the company’s rivals
- The possibility of new product
- Bargaining power of the industry suppliers
- The consumer’s bargaining powe
For more information on Porter’s Five Forces, please check the video posted on Investopedia:
MIT Asia Business Conference
Saturday, March 7th, 2015 8AM – 7PM
MIT Media Lab, 75 Amherst St. Cambridge, MA 02139
Target Audience: 500 (300 students, 200 professionals)
For more details, please visit:
ISM index is at 58.7 in Nov., which is a little lower than what it was in Oct.
In china, the HSBC purchasing managers index dropped to six months low, raising fears of a slowing Chinese economy.
Retail sales dropped 11% than last year during thanksgiving.
People’s Bank of China cut its one- year loan rate by 0.4percentage points
The ECB makes its policy announcement Thursday 11.21. Persistently low inflation and a flagging economic recovery have ramped up the pressure on the central bank.
GM and Chrysler on Tuesday posted their best Nov. U.S. sales figures in several years. Ford Motor Co. reported a decline.
Announced that it declined to cut oil production.
Oil price dropped significantly on Friday.
Life Time Fitness, Inc.
Estb. 1992 in Chanhassen, MN
13 fitness centers
Designs, builds and operates fitness and athletic centers
Prev. Close: 54.47
Industry Statistics 2013
US HealthClub Industry Revenue: 2.4% growth past 5 years
US Health Club Memberships: 2.5% growth past 5 years
Core Members 2% growth past 5 years
in Q3 2014, total revenue grew 6.6%
Total revenue for the first nine months of 2014 grew 6.6%
Membership dues: 6% increase
In center revenue: 9% increase
Operating Cash Flow: 245M
Debt: Equity = 0.49
Expect 6.6% increase in revenue due to holiday season and expansion.
In the News
Dec 3: Acquired ShapeMed- wellness and non- surgical aesthetics company
Jan1-4: Million Workout Weekend
Holiday season memberships expected.
They are expected to grow because of expansion
Suggest to be a short term holding
Monday: Japanese stocks suffered their worst daily drop in more than 3 months
The Nakkei Average tumbled 3%
U.S stocks mostly lowered on Monday due to Japanese recession
WMT’s revenue growth has slightly outpaced the industry average of 0.9%
Net operating cash flow has significantly increased.
Sales grew in the home goods, apparel and health categories, as well as at the smaller Neighborhood Market stores. Online shopping was another bright spot
Total sales increased 2.8%, beating the industry average
Gross profit at the U.S. segment inched up to 0.2%
Baker Hughes and Halliburton Merger
Halliburton, an oilfield- services provider, says it can slash 2 billion after acquiring its similar- sized rival
Actavis to buy Allergan
Bill Ackman’s stake in Allergan Inc. has almost doubled in revenue.
Actavis will purchase Botox maker Allergan in a 66 billion deal
The combined firm expects to have revenues of 23 billion in 2015
J&J Snack Foods
1971 Pennsauken, NJ
Consumer Goods; Processed& Packaged Goods
Manufactures, markets and distributes foods and beverages
U.S., Mexico, and Canada
Food Service, Retail supermarket and frozen Beverages
P/E 26.9 (little bit higher than industry)
Net sales increased 7% for the quarter and 6% for the year
Very low in debt
Operating cash flow(100 mill)
Sufficient to fund future growth
Acquisitions can be a potential growth
In the News
Partnership with Mondelez International
Oreo Churros (a new product):
The churros can be served with OREO cookie creme dip, supplied by J&J Snack Foods
Risk and Competitors
Part of the risk with any food/ beverage/ service company is the ever- present threat of a downturn in consumer sentiment/spending
Given subsidiaries located and operating Canada, Mexico- risk lie in those markets
Competitors with similar products: Snyder Lance& Mrs. Fields
Growth: 5.84% in 2015, 6.50% in 2016
PE: 25.35 in 2015, 23.83 in 2016
Unemployment fall10000 to 278 000
ECB keeps the key interest rate unchanged.
Euro has very low rate inflation
Comcast: service providers slipping: Obama urge FCC to adopt net neutrality
Stock price up to 120(most because of bachelor’s day). Sales volume reached 9B
Tmall recently began allowing foreign brands to reach Chinese consumers directly through its network
Shares up 15.7% last Thursday on strong third quarter earning result
Net sales grew by 30%
Strength: notable ROE, revenue growth and good cash flow from operations
Weakness: higher debt management risk
To acquire video advertising company Brightroll for $640 million
Combine yahoo’s premium desktop and mobile video adverting inventory with Brightroll’s platform
Government spending out of total GDP increases rapidly in recent 30 years
$8508 personal spending on health care in 2013
Hospital mergers can lead to price increases of up to 20.3%
Enter barriers: new drug development; demand for doctors; build a new hospital
FDA: New Drug Development Process: an average of 12 years
More joint hospital overseas
4 concerns: aging population and chronic diseases; cost and quality; access to cares; technology
Numerous digital and e-health/data initiatives are gaining critical mass
A leading company of glucose Mortaring
2005- IPO ON NASDAQ
Ambulatory product line
In- Hopspital Product Line
Importance of Glucose Monitoring
Limitations of Existing Glucose Monitoring Products
Fraud and Abuse Laws NAD other Compliance Requirement
FDA Approves Dexcom Share
Collaboration with Animas AND Tandem
Wearable Device (corporation with Apple)
JP Morgan will be presenting two different events on campus next week each highlighting different JP Morgan programs. Come join us and don’t miss out the great opportunities!
Date: Wednesday, November 12
Place: Wyndham Ely Room
Rick Mayell, Managing Director from the N.Y. office of JP Morgan will be talking about the 2015 Global Wealth Management Summer Analyst Program. Tri-College interviews will be conducted for selected juniors here in February. The job description is posted in Lantern Link. Both sophomore and juniors are invited to attend the Information Session to learn more about the program.
Date: Thursday, November 13
Place: Thomas 110
JP Morgan panelists including our own Bluma Millman (BMC 2014) will discuss the Financial Analyst Development Program. Internship opportunities for sophomores and juniors will be discussed as well as full time opportunities for seniors. Internship and full time opportunities for both of these positions are posted in LanternLink. Students are encouraged to bring copies of their resume to this Information Session. Sophomore, juniors and seniors welcome.
The end of QE:
Officially announced last week that it end its QE program this month
Earning of 43 cents per share
Increase of 49% from last quarter
Facebook surprised investors, declaring 2015 a “Significant Investment Year”
Michael Kors Qtrly Earnings:
Net earnings of$1 per share on 1.06 billion in revenue.
Comparable store sales grew 16.4%, but fell short of the 19% growth forecast.
Following the release of the earnings results, shares of Michael Kors plunged as much as 11% in pre- market trading action
NTT and VZ were add into the portfolio
- Largest wireless service provider in the U.S by retail connections and revenue.
Completed 100% stake acquisition of Vodafone Group Feb 2014
- Two sections: Verizon Wireless& Verizon Wireline
Stock and Financials Overview
- Market Cap207.13B
- P/E 10.78
- 3rd quarter report: increase in revenue
- Added 1.5 million new subscribers to its wireless service, beating analysts’ estimate.
- Missed expected 92 cents per share
- Significant domestic and global competition faced by both the Wireless and Wireline segment.
- Rapid technological development and changing consumer demand
- Verizon’s has a significant amount of debt and it could further increase if Verizon incurs additional debt or does not retire existing debt.
- Increasing demand in mobile data and broadband service
- Strong subscriber addition:
- Wireless segment adds 1/4M postpaid connections
- Wireline: Verizon added 130,000 net new FiOS Internet connections and 100,000 net new FiOS Video connections
- Market trend dip last week but bounced back since 10/21
General concern in the market: increasing interest rate
- Third quarter report is out:
- Boeing shows strong 3rd quarter result: 17% increase in earning
- Yahoo’s earning exceeds expectation but not very impressive compared to other companies.
- Snap chat start to raise more money.
- The world’s largest independent exploration and production (E&P) company.
- Explore for, produce, transport and market crude oil, bitumen, natural gas, liquefied natural gas (LNG) and natural gas liquids on a worldwide basis.
- Have operations and activities in 27 countries.
- Six operating segments defined by geographic region: Alaska, Lower 48 and Latin America, Canada, Europe, Asia Pacific and Middle East, and Other International.
- No dominating competitors for any segment of business.
- Goal: 3-5 % annual production and margin growth.
- Prices of crude oil, bitumen, natural gas, natural gas liquids and liquefied natural gas.
- Decline in volume of reserves.
- Expenses on compliance with existing and future environmental laws and regulations.
- Change in domestic and worldwide political and economic environment.
- Changes in governmental regulations may impose price controls and limitations on production of crude oil, natural gas, bitumen, and natural gas liquids.
Decline in oil price- strategic focus
- Higher cash margin developments by reducing production cost.
- ConocoPhillps produces oil and gas at comparatively low rate compare to other oil and gas producers.
- 179%annual reserve placement in 2013
- Continue adding deep water discoveries.
- Increased production on reserves.
- Has enough assets to cover liability
- Net tangible assets have been growing since 2012