Tag: scripsio

Valero Energy Corporation
operates as an independent petroleum refining and ethanol producing company in
the United States, Canada, the United Kingdom, Ireland, and internationally. The
company is involved in oil and gas refining, marketing, and bulk selling activities.
It produces conventional and premium gasolines, diesel fuels and other distillates.

This past week, Valero
Energy Corp. beat analysts’ expectations in the third quarter, reporting a
profit of $609 million, or $1.48 per share. 
It was a better-than-expected quarter despite making $250 million less
in profit than the company reported during the same period last year, when the
company reported $856 million in profit, or $2.01 per share.

Valero also makes ethanol.  Ethanol is made from corn and almost 50% of corn
crop in the US is used to make ethanol. 
However, this past Spring into Summer the Midwest was hit with massive
flooding, which lead to record slow planting season for corn.  The end result was corn prices were high, which
is an input cost for Valero, which lead to low margins.

Valero can utilize its midstream network to process cheaper crude oils. However, the fall in spreads between discounted (medium or heavy) crudes and Brent affected the company’s refining earnings. The Brent-WTI, Brent-LLS (Louisiana Light Sweet), Brent-ANS (Alaskan North Sweet), Brent-Maya, and Brent-ASCI (Argus Sour Crude Index) spreads narrowed YoY in the third quarter.

The Brent-ANS spread fell from $0.4 per barrel in the third quarter of 2018 to -$0.9 per barrel in the third quarter of 2019. The Brent-Maya spread also narrowed from $9.7 per barrel to $5.4 per barrel. Similarly, the Brent-ASCI spread fell from $5.1 per barrel in the third quarter of 2018 to $3.2 per barrel in the third quarter of 2019. The most important of all, Brent-WTI, fell from $6.2 per barrel in the third quarter of 2018 to $5.6 per barrel in the third quarter of 2019.

Further, in the third quarter, gasoline cracks declined in the US Gulf Coast, US Midcontinent, and North Atlantic. However, the crack rose in the US West Coast. Diesel cracks also put up a mixed trend.

Source

The crack spread is the one parameter that determines a refiner’s earnings.  The crack spread entails the cost of the raw material input, oil and what the finished product, gasoline, diesel, and jet fuel can be sold for.

Since there are 42
gallons of oil in a barrel, you can multiply this ratio by 42 to get the actual
profit margin per unit. At today’s ratio of .0295, multiplying by 42 gives us
1.24. That means a profit margin of 24% for every gallon of crude oil refined into gasoline.

But during the earnings call, Valero forecasted favorable market conditions for the current quarter, based on improved gasoline and distillate cracks from the lower levels and sour crude weakness resulting from the IMO low-sulfur fuel oil mandate, which goes into effect on January 1, 2020. And this is why Valero broke out after consolidating for the past 10 months.

Thus, the chart suggests there is room for price to run up to $108, which would represent another 9% increase in price.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Bitcoin fan and Twitter CEO Jack Dorsey said today at a Twitter media event in New York City. He said “hell no” when asked if he would join the Libra Association.

He then went on to explain that the Facebook-created stablecoin didn’t need to be a cryptocurrency to pull off its broader goals of democratizing the financial system.

“I don’t know if it’s a gimmick,” said Dorsey “but a cryptocurrency wasn’t necessary to make that work”

“It’s not an internet open standard that was born on the internet,”

“It was born out of a company’s intention, and it’s not consistent with what I personally believe and what I want our company to stand for.”

Source

Jack is the CEO of not only Twitter, but Square as well.  Square, Inc. provides payment and point-of-sale solutions in the United States and internationally. The company’s commerce ecosystem includes point-of-sale software and hardware that enables sellers to turn mobile and computing devices into payment and point-of-sale solutions.

I have come to like Square over the last two years, not because I’m a customer, but because I see them as a Disruptor.  I’m bias to Square because of their first to market initiatives into Cryptocurrencies.  Back in April of 2018, Square allowed customers buy and sell bitcoins via its Cash App in all 50 U.S. states.

Then in March Square announced Square Crypto.  Square Crypto’s goal is to help improve the Bitcoin ecosystem.  Team members include: Valentine Wallace joins from Lightning Labs, Jeffrey Czyz from Google, and Arik Sozman from Facebook, where he was building the Calibra wallet for Facebook’s blockchain project, Libra and Matt Corallo, co-founder of Blockstream.

But is not just the crypto space that Square is focused on.  Over the next few weeks, Square will start allowing customers to buy and sells stocks for free on its cash payments app.  And yesterday Square announced the rollout of fractional stock trading services on its Cash App.  As an example, this means you can buy just a fraction of one Amazon stock vs. dishing out over $1700 / share.

So where is the price of Square heading next, the last several weeks, price has been sideways, but if price gets down to the weekly demand at $46, the chart suggests to buy and go long.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

World Wrestling Entertainment, Inc., an integrated media and entertainment company, engages in the sports entertainment business in North America, Europe, the Middle East, Africa, the Asia Pacific, and Latin America.

Along with watching the kung fu movies on Sat. it was all about watching wrestling on TV as well.  My era of wrestlers didn’t involve WWE superstar, John Cena, and his signature “you can’t see me” hand gesture.  Nor did I ever see Dwayne “The Rock” Johnson wrestle.  The only screen I ever see Dwayne on are the moving screen.  My era involved André the Giant and Hulk Hogan.  The rivalry that had is perhaps is one of the most important in professional wrestling history.

Andre the Giant’s real name was André René Roussimoff who also happen to be a French actor as well.  But his wrestling name was so fitting.  By the time Andre was 12, he was already 6 foot 3 and 240 lbs and later grew to 7 foot 4 and 540 lbs.

Terry Gene Bollea aka Hulk Hogan, was the Man.  He was the face of the WWE back then and is one the most popular professional wrestlers of all-time. However, I never got the pleasure to play his video game, Hulk Hogan’s Main Event.

Then I grew up and found out the WWE doesn’t exist to really entertain us, it’s about making money.  If you had held the stock in the last five years, well you would be up about 400% with EPS growth of 45% per year the last three years.  But if you still hold the stock, well you would be down about 30% since April.  The decline in the stock in recent months is largely due to declines in their viewership.  For example, SmackDown TV ratings declined 13% in the first quarter 2019 and the average attendance at WWE’s live events across North America fell 4% in June.

However, with the company’s third-quarter earnings report less than a week away, analysts remain bullish on WWE’s longer-term outlook.

Morgan Stanley Weighs In

On Wednesday, Morgan Stanley analyst Benjamin Swinburne reiterated his Overweight rating and $85 price target for WWE.

Swinburne said WWE has simply been struggling to meet high expectations in the past two quarters, but he said little has changed about the company’s fundamental outlook.

“Expectations aside, WWE continues to offer exposure to an asset with unique IP, rapidly growing revenues and FCF, and now at its lowest multiple since late ’17,” he wrote in a note.

Morgan Stanley is forecasting high single-digit EBITDA growth for WWE through 2025, and Swinburne said the 2019 sell-off is a buying opportunity.

Source

And the Smart Money is taking notice because today I noticed bullish buying in the January $75 call options where they bought over 6,000 contracts.

At the moment, the momentum is to the downside, but limit. With three months before these contracts expire, there is plenty of time for momentum to reverse…and the catalyst could be when WWE announces earnings next week.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Beyond Meat priced its initial public offering at $25 and skyrocket 800% in less than four months. Beyond Meat, a maker of plant-based meat controls about 10% of the plant based meat market.  And because they have achieved “first to market” they are the new IT THING on Wall Street.  But there valuation is beyond ridiculous.   Their valuation is higher than roughly 25% of the companies in the S&P 500 index and their “first to market” competitive advantage expired.

Kellogg (K) introduced “Incogmeato” and their plant-based burger patties, Chik’n tenders, and Chik’n nuggets which go on sale in early 2020.  Hormel Foods announced its plant-based meat substitute called “Happy Little Plants” is available at select retailers.  The Impossible Foods launched the Impossible Burger through Burger King in August.  Kroger said they will sell a new line of branded plant-based burgers, other meatless products like dips, pasta sauces and cookie dough in the coming months under their Simple Truth Plant Based label.

Beyond Meat Inc. was initiated at sell with a $120 price target at CFRA, with analyst Arun Sundaram saying the plant-based meat company will be overtaken by bigger players entering the space.

“We think larger packaged food companies will end up as the category leaders in the space given their vast global footprint and embedded relationships throughout the supply chain,” Sundaram wrote in a note. “Yet we expect Beyond Meat to be the greatest disrupter in this space since no public packaged food peer comes close to Beyond Meat in terms of research and development spend as a percentage of sales.”

Sundaram notes that “many think Impossible Foods’ Impossible Burger tastes better than the Beyond Burger.”

Source

The call is a bit late and should have been made when the chart was suggesting that price was going lower.

But now we are just $10 from that $100 level I talked about one month ago.

The $100 level represents price at a discount.  But, don’t listen to me, just pay attention to what the Smart Money is doing.

Heading into the third quarter of 2019, a total of 16 of the hedge funds tracked by Insider Monkey held long positions in this stock, a change of 16 from one quarter earlier.

With a general bullishness amongst the heavyweights, some big names have jumped into Beyond Meat, Inc. (NASDAQ:BYND) headfirst. Citadel Investment Group, managed by Ken Griffin, created the most valuable call position in Beyond Meat, Inc. (NASDAQ:BYND). Citadel Investment Group had $117.8 million invested in the company at the end of the quarter. OZ Management also initiated a $11.9 million position during the quarter. The other funds with brand new BYND positions are Brad Farber’s Atika Capital, Robert Henry Lynch’s Aristeia Capital, and Anthony Bozza’s Lakewood Capital Management.

Source

I personally envision the $100 level will be an accumulation level for the Smart Money.  I think price will hang out near the $100 level for a bit, until the Smart Money is able to fill all their buy orders and then I think price will move higher.

Prediction…Beyond Meat Goes Down To $100 First Before Up To $200

Prediction…Beyond Meat Goes Down To $100 First Before Up To $200 – Part 2

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Intuitive Surgical, Inc. designs, manufactures, and markets da Vinci surgical systems, and related instruments and accessories. Its da Vinci Surgical System transforms the surgeon’s natural hand movements outside the body into corresponding micro-movements inside the patient’s body.

Intuitive Surgical, Inc. has been at the forefront of robot-assisted surgery for more than two decades. The beauty of their products is they allow quicker recovery times for patients undergoing surgery through minimally-invasive surgery which lower the bill for all parties involved.

Traditional open surgery involves a large cut so the surgeon can see the part of the bodying being worked on.  Minimally invasive surgery involves small cuts and accessories like small tools, cameras, and lights that fit through several tiny cuts in your skin.  And minimally invasive surgeries done by robotic technology allows for more precise control through an operative field in 3-D resulting in a speedier recovery spent at home vs. in the hospital. 

Robotic surgery is steadily carving its niche across a wide array of surgical fields within MedTech. In neurosurgery, image-guided robots enable the examination of brain lesions without resulting in any major damage to adjacent tissues.   In orthopedics, robotic surgery helps shape the femur to precisely fit prosthetic hip-joint replacements. Currently, an increasing number of orthopedic surgeons are opting for robot-assisted surgery for knee, hip and spine.  Robot-assisted surgery has also been finding its application in urology, especially in prostatectomy. Complex gynecological surgeries have also been witnessing the increasing adoption of robotics, using the Da Vinci Surgical System.

Source

It’s no wonder that over
the last five years, Intuitive Surgical earnings per share have grown 21% per
year, which has translated for their stock price increasing 28% per year during
that same time frame.  And this past
week, their earning results continue to impress.

Intuitive Surgical
reported earnings per share of $3.43 a share in the third quarter, beating
expectations of $2.96.  Revenue also
topped expectations at $1,128 million, compared to $921 million in the third
quarter of 2018.

The company credited the earnings beat due to increased U.S. general surgery and worldwide urologic procedures utilizing their da Vinci robot.

275 da Vinci robot were shipped in the quarter, an increase of 19% vs. the year-earlier period.  There are now there were 5,406 installed da Vinci systems worldwide and this number will only increase as the cost of health care continues to rise.

Source

Speaking of rising, where is the stock heading next, let go to the charts to find out? Right now the playing field is between the weekly demand at $450 and the weekly supply at $580.

Thus, the chart suggests to go short if price makes it up to the daily supply at $580.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

WD-40 which stands for “water displacing” was first used by the military in the ’50s to clean up Atlas missile parts. Throughout the years, people have found over 2000 uses for WD-40. Growing up in the projects of NYC, I have seen my fair share of roaches, but I just found out I in addition to using Raid Roach spray, I could of used WD-40 for instant kills as well.

Three months ago, I wrote a post about WD-40,

Did You Go Out And Buy WD-40 Too???

We all know it, have seen it, probably even take it for granted. I’m talking about WD-40. It has infinite uses and is the real utility knife. Just to get you acquainted again with WD-40, here are just 10 of the the 2000 uses of WD-40.

Despite the bump up in price this week, the levels in play and to monitor are the $150 level on the downside and the $188 level on the upside.

I like to think I’m creative with my titles, so the title three months ago was a play on words. Everyone should have WD-40 in the cabinet. However, WD-40 wasn’t a buy three months ago simply put, because the upper limit was $190, the reward wasn’t worth the risk. But thinking about this further, I guess it’s all relative and depends on what type of investor / trader you are. Anyway lets get back to WD-40.

WD-40 is a straight cash money making machine.  The company has grown their dividends on a year basis that’s equivalent to 9% over the last 10 years.  WD-40 has been growing its earnings per share at 13% each year over the past 5 years.  It’s no wonder institutional investors hold almost 90% of the stock. 

WD-40 reported earnings this past week. Although they beat earnings expectations, their outlook was below expectations and on the news the stock price fell the next trading day, but came storming back closing $7 up on the day. However, the fact that price breached a major resistance/support line, I think the risk is to the downside now.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

The U.S.-China trade war will cut 2019 global growth to its slowest pace since the 2008-2009 financial crisis, the International Monetary Fund warned on Tuesday, adding that the outlook could darken considerably if trade tensions remain unresolved.

Earlier this week, the International Monetary Fund (IMF) said its latest projections for the world economy show 2019 GDP growth at 3.0%, down from 3.2% in a July forecast.  The main culprit was the US-China trade war which is expected to cut 2019 global growth to its slowest pace since the Great Recession. 

Although, the US and China reached a phase I trade deal last week, the IMF stated if deal isn’t reached in the near future, the slowdown in the world economy could worsen, case in point….China.

China’s growth outlook for the remainder of the year and into 2020 is expected to weaken further because of obstacles including drag from the ongoing trade war with the United States, analysts said.

The next mile marker in China’s economic slowdown will come on Friday, when the country reports third quarter growth. Analysts expect it to slow to 6.1 per cent from the 6.2 per cent rate seen in the second quarter, which was the lowest growth rate since the government started publishing quarterly gross domestic product (GDP) statistics in the first quarter of 1992.

But analysts are rapidly revising down their expectations for 2020 below the lower end of this year’s growth range. Most forecasts put next year’s growth between 5.5 per cent and 5.9 per cent, with the International Monetary Fund’s just-released projection at 5.8 per cent.

Source

The MSCI Emerging Markets Index stands for Morgan Stanley Capital International (MSCI) and is an index used to measure equity market performance in global emerging markets.   The MSCI ETF that tracks this index is heavily exposed to China.  So where is price of the MSCI ETF headed, lets go to the charts?

Monthly Chart (Curve Time Frame) – monthly demand is at $120.

Weekly Chart (Trend Time Frame) – the trend is still up, but momentum appears to be stalling.

Daily Chart (Entry Time Frame) – the chart suggests once the support breaks, to look for shorts to the down side with a first target at the weekly demand at $172.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

This past weekend I came
across an article on Motley Fool titled,

Better Buy: ExxonMobil vs. Dow

I immediately thought
about the which one is the lesser of two evils…very similar when Hillary was
running against Trump a couple of years ago. 

Nevertheless, I wanted to
get a tidbit from the article before I give you my opinion.

ExxonMobil (NYSE:XOM) is an old hand with a diversified business model. While the name Dow (NYSE:DOW) is old, it’s really a new company today, with a focus on the chemical space. Here’s a few things you need to think about to decide which one of these iconic names is a better fit for your portfolio.

Exxon is working through a difficult period for oil prices and spending heavily to improve its business. It has a rock-solid balance sheet and looks relatively cheap from a historical basis (the yield is higher than it has been in decades). It is hardly risk-free, but it has a long history of success behind it. Even conservative investors would be OK jumping aboard here.

Dow has a great name and solid businesses, but is really a new company today with a very limited history. Its balance sheet isn’t as strong as Exxon’s, but it also isn’t likely to face the same top- and bottom-line swings. That also suggests its target payout ratio is reasonable. However, with little track record, most investors would probably be better off giving the company at least a year or so to get its house in order before jumping on this high-yield stock.

Source

Sector SPDR ETFs have become one of the most popular ways to invest in specific sectors of the stock market. Sector SPDRs track 11 different sectors in the S&P 500.  It’s important to note that 39% of a stock’s move is due to the sector that it belongs to.  The remaining balance is 41% of a stock’s move is due to the index and only 20% of a stock’s move is due to the company itself.

Since May I started tracking the SPDR sectors based on a moving average and a rating system I developed.  It’s been fairly accurate in identifying the strongest and weakest sectors. Please note Exon belongs to the XLE sector and Dow belongs to the XLB sector.

Here are the results from
last week.

Here are the results from
wk of 5/13/19

As you can see, both companies have been in the worse sector five months ago and today. And when I look at the monthly chart for both companies, the chart suggests ExxonMobil will fall to the monthly demand at $68,

while the chart for DOW suggests price will fall to weekly demand at $42.

If I was Motley Fool, I would of probably titled the article, “Better Buy In the Future: ExxonMobil Or Dow” because neither one of them is worth buying at this point.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.