Tag: Stocks

Village Farms International, Inc., together with its subsidiaries, produces, markets, and distributes greenhouse-grown tomatoes, bell peppers, and cucumbers in North America. But in 2017, the company partnered with Emerald Health Therapeutics, a Canada-based, medical-marijuana research company and formed a 50-50 joint venture called Pure Sunfarms.

Because Village Farms International is still known as a produce grower the valuation is almost half those of other companies in the cannabis started.  But behind the scenes, they are converting their greenhouses to produce cannabis.  And what I didn’t know is the company has one of the lowest cost / gram equating to very good margins.  Thus, it only makes sense that the company had three straight quarters of recorded a profit with an avg. profit margin exceeding 20%.

Village Farms also has a hand in the hemp sector, so they have expansion opportunities in the US with the passing for the Farm Bill I 2018.

The 2018 farm bill, which legalized industrial hemp cultivation, has opened up new opportunities for cannabidiol (CBD) extraction in the U.S. that otherwise weren’t available to producers. Village Farms is looking to test the waters in this regard, initially growing and selling hemp biomass, as well as CBD oil on the wholesale market to boost its near-term cash flow. To do this, the company also has a separate hemp-based joint venture which includes over 920 acres across four states. Village Farms also expects to eventually sell CBD products directly to major retailers sometime in 2020. While there isn’t too much to say about this hemp joint venture considering the lack of significant financial results, it will be interesting to see just how successful its initial hemp/CBD efforts will be.

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Village Farms offer investors an opportunity to come into the cannabis space through the back door.  While other companies have been overhyped and haven’t been able to deliver, Village Farms is slowing starting to flex their muscles in the cannabis space.  And I particularly like their medical marijuana research company because in the future, the marijuana will be a low margin commodity.  So how should potential investors get into the stock, lets go to the charts.

Well, price did react to the daily demand at $9.60, but there are no more unfilled buy orders at that level.

Thus, the next stack of unfilled buy orders are at the daily demand at $6.50.

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.

5G ((short for 5th Generation) is the next generation of mobile communication. 5G brings three new aspects to the table: greater speed (to move more data), lower latency (to be more responsive), and the ability to connect a lot more devices at once (for sensors and smart devices). 5G will be a whole new kind of network, enabling new experiences that will change how we live, work, and play.

Equity analysts Kyle McNealy and George Notter have just come out with a recommendation for investors to buy Apple, and a target for shares to rise to $260. They say Wall Street fails to appreciate how much the company stands to benefit from fifth generation cellular network technology, which basically promises faster data connection

“In our view, current expectations for Apple’s first 5G iPhone lineup are too low. They underestimate Apple’s competitive position for 5G devices,” they said.

They expect better iPhone sales than Wall Street, where current consensus forecasts call for 190 million iPhone units sold in fiscal year 2021 — seen as a big year for 5G devices. That’s 9% below the 6-year unit shipment average for iPhone product cycles, said the analysts, who expect sales of 208 million for 2021.

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But this post isn’t about Apple, it’s about Viavi Solutions. 

While widespread 5G use isn’t a household name yet, engineers are beginning to move parts and subsystems into characterization, validation, production, and deployment.  And that were Viavi Solutions comes into play. 

Viavi Solutions Inc. provides network test, monitoring, and assurance solutions to communications service providers, enterprises, network equipment manufacturers, civil government, military, and avionics customers worldwide.  And it just so happens to be 1 of 2 players in the space that makes 5G testing gear.

Viavi Solutions Inc. announced their first quarter earnings a couple of weeks ago.   Viavi Solutions Inc raised their revenue guidance from a range of $273 million to $293 million to a range of $282 million to $294 million; and raised their earning per share guidance from a range of 14-16 cents to a range of 15-17 cents.  In addition, the company approved a stock repurchase program for up to $200 million of the company’s common stock.

So if you believe in 5G, here’s an opportunity to ride the wave with a company with only a 3.5 billion market cap.  So how does one get on board, well lets go to the charts. The weekly demand at $13 is all used up,

so if price gets down to the weekly demand at $10.50, the chart suggests to take it 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.

On Tuesday the Fed Powell
will discuss US monetary policy and on Weds will announce whether he is keeping
interest rates on hold or dropping them.  In July Fed Powell lowered interest rates for
the first time in a decade.  Wall Street
is expecting the same on Weds, pricing in an 86% chance of a quarter-basis
point cut.

If the US equity markets are going to continue their climb higher, the Russell 2000 must fall inline.  The Russell 2000 index represents the largest 2000 small cap public companies in the US.  But in recent months the Russell 2000 have been stubborn to rise with the DOW, NASDAQ and S&P 500 as indicated by the green line.

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Usually towards the end of the business cycle, rising interest rates hurt smaller companies the most because they have a higher debt to earnings ratio and lower free cash flow relative to much larger companies.  Also, smaller companies are more volatile and tend to react and respond to changes in economic conditions and changes in investor sentiment first. However, if rates are going to continue to get cut, that should help the Russell 2000 to finally join the party. And based on the Russell 2000 outpacing its friends last week, I think it things a rate cut is already “money in the bag.”

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The iShares Russell 2000 ETF, which tracks the Russell 2000 Index of stocks with smaller market capitalizations, saw its largest weekly inflows in nearly a year during the week that ended September 6. Those inflows totaled $1.5 billion and followed a $340 million inflow during the final days of August. Since bottoming out on August 27, the iShares ETF has rallied nearly 9% compared to the S&P 500’s gain of 5% over the same period.

There is the possibility that the resurgence could be longer lasting if the Federal Reserve’s interest rate cut at the end of July is more than just a one-off and marks the beginning of a rate-cutting cycle.

Judging by history, further rate cuts would be supportive of small-cap equities. During the first year following the start of a Fed rate-cut cycle, small caps have risen on average 28% compared with just 15% for large caps, according to investment banking firm Jeffries, per the FT.

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Thus the chart suggests the two levels to monitor above price are the daily supply at $1630 and $1665.

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.