What is a Value Stock?
A value stock traditionally has a lower price when compared to stock prices of companies in the same industry. This indicates that the company may be undervalued, as investors are not expressing as much interest in such companies. The most commonly used way to check for value is with the price-to-earnings multiple, or P/E. A low P/E multiple is a good indication that the stock is undervalued.
The following stocks are considered to be notable value stocks in the technology sector:
- NCR (NYSE: NCR) – P/E: 5.99
- China Index Holdings (NASDAQ: CIH) – P/E: 3.59
- Inpixon (NASDAQ: INPX) – P/E: 0.04
- Ebix (NASDAQ: EBIX) – P/E: 6.81
- Canadian Solar (NASDAQ: CSIQ) – P/E: 7.09
NCR has reported Q2 earnings per share at 0.27, which has decreased by 12.9% compared to Q1, which was 0.31. NCR does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
China Index Holdings looks to be undervalued. It possesses an EPS of 0.1, which has not changed since last quarter (Q1). China Index Holdings does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
This quarter, Inpixon experienced an increase in earnings per share, which was -0.92 in Q1 and is now -0.21. Inpixon does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
Ebix saw a decrease in earnings per share from 0.96 in Q1 to 0.88 now. Its most recent dividend yield is at 1.2%, which has decreased by 0.23% from 1.43% in the previous quarter.
Canadian Solar has reported Q2 earnings per share at 0.09, which has decreased by 95.11% compared to Q1, which was 1.84. Canadian Solar does not have a dividend yield, which investors should be aware of when considering holding onto such a stock.
These 5 value stocks were selected by Benzinga Insights based on quantified analysis. While this methodical judgment process is not meant to make final decisions, our technology can give investors additional perception into the sector.
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© 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Lithuanian port caught in Belarus crossfire
A vital maritime trade hub for landlocked Belarus, the Lithuanian port of Klaipeda now faces economic fallout from the Baltic state’s hard line against President Alexander Lukashenko.
The embattled Belarusian leader has threatened to re-route import and export cargo through Russian ports after Lithuania and its neighbours Estonia and Latvia last month imposed sanctions against him.
Their move came as the strongman staged brutal crackdowns against protesters who demanded that he step down following a disputed August 9 presidential election.
Klaipeda is the largest port in the Baltic states and handles more than 45 million tonnes of goods a year — more than quarter of it from and to Belarus via Lithuanian rail.
“Belarusian cargo is very important for the port of Klaipeda,” Algis Latakas, director general of the port, told AFP, standing near carriages and a ship loaded with Belarusian fertilizer.
Andrius Romanovskis, president of Lithuania’s business confederation, said companies operating in Klaipeda were “very sensitive and are closely following” the latest news from Belarus.
“For some companies, it would mean quite a strong negative economic effect,” he said.
– ‘It may be possible’ –
Lukashenko, facing the biggest challenge to his 26-year rule, threatened to cut off the route through neighbouring Lithuania after Vilnius imposed sanctions for election fraud.
His tough talk has been backed up by Russia, his main ally that wants to divert oil shipments from Lithuanian to Russian ports.
Apart from oil products, Belarus also uses Klaipeda to export fertilizer from Belaruskali, the world’s largest producer of potash.
Latakas said a boycott would be purely political and would make no sense economically.
“We think that in the near term, politically it may be possible but it would prove rather complicated practically because it needs technologies and a concerted logistics chain.
“Klaipeda is the closest location to Belarusian fertilizer factories, and since 2006 Belarusian cargo has mostly sailed to the rest of the world through Klaipeda,” Latakas said.
He said the port and Lithuania’s railways have not seen any changes so far except that Lithuanian truckers have reported more thorough checks at the land border in recent days.
– Deal with Russia imminent? –
Before the presidential election, Belarus had been using oil imports through Klaipeda — including spot purchases from the United States and Saudi Arabia — to reduce its reliance on Russia.
Since the vote and mass protests that ensued, the Belarusian government has changed tack as Lukashenko became heavily reliant on his single most important backer.
Russian Energy Minister Alexander Novak visited Minsk to raise the issue earlier this month, sparking speculation about an imminent deal.
“We need to create the economic conditions that will be beneficial to both sides,” he said, voicing hope that a deal could be reached with Belarus by the end of the month.
Russian officials have said any Belarusian cargo could transit instead through the Russian Baltic Sea ports of Ust-Luga and Kaliningrad.
Even though this might be more expensive, some experts believe Moscow could be willing to compensate Belarus to get the cargo and punish EU and NATO member Lithuania.
Lithuania has particularly angered Minsk in recent weeks as it has been hosting opposition presidential candidate Svetlana Tikhanovskaya, who fled soon after claiming victory against Lukashenko and has inspired mass protests.
But Lithuanian President Gitanas Nauseda brushed aside the prospect of any impact if Belarus switches its trade to Russia, insisting that Belarus would not harm itself economically.
Earlier this month, he told AFP in an interview: “I do not want to speculate what is happening in the minds of these people but the economic reality is that Belarus benefits most from transporting its cargo through Klaipeda.”
7 Debt-Free Stocks to Buy For Peace of Mind In Volatile Markets
During times of uncertainty, investors crave a sure thing. There are times to be “risk-on” and there are times to be “risk-off.” When investors flock to the latter, they often look for companies with no debt.
That doesn’t mean these stocks won’t fluctuate with the overall market. But there is a level of comfort in owning stocks with financial stability.
Look back at how most individual stocks performed in March. The market threw a tantrum and nearly every name was punished. But those that were punished the most are those with the shakiest financials.
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Plus, who wants to own a stock with poor financial positioning? There’s a reason people say “cash is king.”
Here are 7 companies with no debt you need to know about:
Intuitive Surgical (NASDAQ:ISRG)
Monster Beverage (NASDAQ:MNST)
Lululemon Athletica (NASDAQ:LULU)
At the end of the day, the companies with the biggest bank accounts have the most flexibility, and can better withstand long economic disruptions. They can lean on M&A, taking investments stakes in other companies and outmuscling their debt-ridden peers.
Companies With No Debt: Intuitive Surgical (ISRG)
Source: Sundry Photography / Shutterstock.com
Rarely do you see a balance sheet like that of Intuitive Surgical, making it a great candidates to kick off our list of stocks with no debt.
The company has $10.1 billion in total assets with just $1.3 billion in total liabilities. A robust balance sheet may boast a five-to-one ratio between total assets and total liabilities, but there aren’t many companies in that category. Intuitive Surgical’s asset-to-liability ratio sits at nearly 10.
Of those assets, almost $4.5 billion is held in cash. Not only does that give the company flexibility in a time of uncertainty, it should also give investors relief knowing that it will not suffer a liquidity event. The downside to Intuitive Surgical is this year’s growth estimates. Analysts expect sales and earnings to decline this year, before snapping back to very strong results in 2021.
Known mostly for its Da Vinci Device, the health field is one that will continue to grow and innovate over time. Admittedly, the novel coronavirus has disrupted the medical industry, but ultimately procedures will go on.
As CEO Gary Guthart said in the most recent earnings report, “We’ve seen hospitals with adequate supplies of staff, PPE and physical resources returned to above 90% of pre-COVID procedure run rates over a few months period.”
Source: Nopparat Khokthong / Shutterstock.com
Pinterest is one of my favorite names on this list. Considered a social media stock, it’s not just the conventional social online platform we’ve come to know.
The company is one of the most efficient at turning ad dollars into revenue, something that makes Pinterest a very lucrative platform for businesses. That’s also helped to fuel its top-line growth. Despite the slowdown from the novel coronavirus, Pinterest still found a way to grow sales last quarter. Analysts are forecasting more than 26% growth for the year despite the economic uncertainty.
But the real beauty lies in the way management handles its finances. Pinterest is expected to swing to profitability this year, from roughly break-even operations in 2019. The company is also free cash flow positive on a trailing basis.
With no debt, $1.7 billion in cash and plenty of long-term growth potential, Pinterest is a stock to own for long-term investors.
Monster Beverage (MNST)
Source: Domagoj Kovacic / Shutterstock.com
Everyone looks to tech when thinking about the biggest long-term winners. Few think of Monster Beverage.
While shares are up modestly over the past few years, this stock has been a beast over the long term. Monster Beverage is up 942% over the last 10 years and an unimaginable 80,000% over the last 20 years.
Obviously we’re not going to get those returns again, but that doesn’t make Monster one to avoid. The stock is forecast to have steady growth in 2020 and 2021. Analysts expect 7% sales growth this year and an acceleration to 10.7% growth next year. For earnings, estimates call for 10.3% and 13.3% growth this year and next year, respectively.
On top of it, the balance sheet is enviable. Monster boasts $5.15 billion in total assets, more than five-fold the $979 million it holds in total liabilities. Of course, it’s a stock with no debt.
Finally, Coca-Cola (NYSE:KO) acquired a 16.7% stake in the company in 2015. That stake has climbed to almost 20% thanks to Monster’s buybacks. Perhaps Coca-Cola is content with its stake — but perhaps it will be interested in an eventual takeover too.
Source: Lori Butcher / Shutterstock.com
DraftKings is the youngest public company on the list. The company went public via a SPAC offering earlier this year and it has been on fire ever since.
While newness doesn’t automatically equate to riskiness, investors have to size up everything about DraftKings.
Its positives include the secular trend toward legalizing online gaming and sports gambling. It has surprisingly solid growth given the massive disruption we’ve seen in the world this year.
DraftKings is also a play on the economy reopening and a return to sports. The latter catalyst is also a risk, though. Should sports leagues postpone again and/or should the economy begin to lock down, DraftKings could find itself on the wrong side of the bet.
Further, as of the most recent quarter, the company was not cash flow positive, nor is profitable yet. That said, some of those concerns are alleviated when considering the current circumstances. That includes realizing that the prior quarter came off the one of the quietest sporting periods in decades.
Further, one must realize that DraftKings can bide its time through the unrest. With minimal cash burn, $1.2 billion in cash and no debt, there’s no need to worry about a liquidity situation.
Lululemon Athletica (LULU)
Source: Richard Frazier / Shutterstock.com
Lululemon Athletica probably isn’t a name many investors expected on this list.
Years ago, the retailer had trouble finding the sweet spot. However, that’s all changed as Lululemon is now a premiere retailer on Wall Street. The company has strong growth, in-demand products and, naturally, a robust balance sheet.
The company’s deep liquidity will allow it to restart its buyback plan, a move the retailer announced on September 22. Further, that liquidity allowed Lululemon to scoop up Mirror for $500 million earlier this year. The startup is an in-home fitness company and should help Lululemon expand into a new growth avenue.
While that deal may slightly add to company debt, it’s not something investors will need to worry about. At a time where retailers are dropping like flies and under severe pressure due to the coronavirus, Lululemon continues to thrive. Aside from its balance sheet strength, it continues to boast strong growth.
Lululemon also continues to see direct-to-consumer (DTC) strength. DTC sales were up 157% year-over-year last quarter, representing more than 60% of all revenue.
A rarely discussed name, Progyny may be a stock investors want to keep on their radar.
The company focuses its work on infertility, a trend that has been growing for quite some time now. That has translated to frustrated couples who have difficulty conceiving. That’s where Progyny comes in to help — and it’s also where it has found solid growth.
Coronavirus-related costs have weighed on Progyny this year, which is expected to earn just 12 cents per share this year. That’s only up a penny from 11 cents per share in 2019. However, estimates call for a big-time acceleration in 2021, with more than 230% earnings growth to 40 cents per share.
Further, revenue growth is no joke. Estimates call for almost 50% growth this year followed by 60% growth in 2021. Progyny is free-cash flow positive over the trailing 12 months, is profitable and has no debt.
This stock has had its ups and downs, falling almost 60% from its February high to the March low. However, the dip gives investors an opportunity to take a closer look at this name.
Source: Pavel Kapysh / Shutterstock.com
Let me preface this by saying that Fastly does technically have some debt. However it’s very minute compared with its market cap and cash position.
Fastly, a recent Wall Street darling, has $5.2 million in current debt and long-term debt of just $20.1 million. $25.3 million in combined debt vs. $385 million in cash and a market cap pushing $10 billion is nothing.
Detractors will say that Fastly is just an edge-computing company in a commoditized market. Bulls would argue that it offers a superior product compared to its peers. Thanks to its superb management, Fastly is carving out a dominant position in an area that’s rapidly becoming important in our Covid-19 world.
As traffic grows and as data demand increases, more and more companies are moving to the edge. With the company’s latest acquisition of Signal Science, it’s also making a push into cybersecurity. This should open up another growth avenue for the company, driving long-term value. The cash and stock deal should also prevent a notable strain on the balance sheet.
While Fastly stock may be a bit pricey due to its monstrous run, shares should still be primed for more upside in the future. The recent demand from increased internet and cloud use isn’t going to subside overnight — or in some bulls’ estimates, at all.
On the date of publication, Bret Kenwell held long positions in PINS and FSLY.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell.
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Maine lobster business salvaged its summer despite pandemic
PORTLAND, Maine (AP) — Maine’s lobster fishermen braced for a difficult summer this year because of the coronavirus pandemic, but then the unexpected happened. They kept catching lobsters, and people kept buying them.
The pandemic has posed significant challenges for the state’s lobster fishery, which is the nation’s largest, but members of the industry reported a steady catch and reasonable prices at the docks. Prices for consumers and wholesalers were low in the early part of the summer but picked up in August to be about on par with a typical summer.
The Maine lobster industry is in the midst of a multiyear boom, and fishermen have caught more than 100 million pounds (45,360,000 kilograms) for a record nine years in a row.
It’s hard to guess whether they’ll reach that total again, but summer 2020 hasn’t been half bad for a season in which many fishermen expected collapse, said Kristan Porter, president of the Maine Lobstermen’s Association.
“Especially early in the season when nothing was open, no restaurants were open. We were thinking it would be a complete disaster,” Porter said. “If it stays like this, we can struggle through and have a season, and then get ready to fish next year.”
Lobster fishermen harvest the seafood species using underwater traps, and the busiest part of the season is the summer. Maine’s lobster fishery is by far the largest in the country. Lobsters are also closely tied to tourism in Maine, which also took a hit from the pandemic.
The lobster industry was apparently helped by the fact that many consumers who typically eat lobster in restaurants started buying them retail, said John Sackton, an industry analyst and founder of SeafoodNews.com. The catch might have been less than recent summers, but that kept prices from falling, he said.
Live lobsters were selling in the $8 range in the wholesale market in mid-September, not too far off from recent seasons.
“Even with Maine travel and quarantine restrictions, there was probably heavier tourist usage in Maine than it appeared that there would be,” Sackton said.
Some lobster businesses pivoted to a direct-to-consumer model during the early stages of the pandemic in an attempt to keep moving product. That allowed the industry to weather the months in which shipping was disrupted and restaurants were almost completely shut down. And lobsters remained easy to find in Maine supermarkets throughout the summer.
Farther from home, the slow reemergence of China as a market for the seafood also bodes well for the lobster business’s future, industry members said.
Lobster has been a major piece of President Donald Trump’s trade hostilities with China. The U.S. shipped almost $26 million in lobster to China through July — far less than the record year of 2018 but more than $6.5 million ahead of the 2019 pace.
That allowed Stephanie Nadeau, owner of The Lobster Co. in Arundel, to rehire most of her crew, which she laid off during the disruptions of the trade war. It has been a hectic year, she said, but the increase in international shipping is a positive sign.
“It’s like riding a bucking bronco,” she said. “You never know which way the bronco’s going to break.”
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