Category "Business"


4 min read


This story originally appeared on MarketBeat

With cybersecurity in the news lately, are stocks like Fortinet (NASDAQ: FTNT) well-positioned for gains?

The stock rebounded Thursday, along with the broader market. 

In addition to the hacking of the Colonial pipeline, the growing work-from-home movement shed light on cybersecurity risks for enterprise. This week, President Joe Biden signed an executive order designed to strengthen the nation’s cybersecurity. 

Fortinet has specialized in core firewall protection, but it’s expanding into a new networking technology called SD-WAN. 

Analysts have great expectations for the company for the next two years. Unlike many companies whose revenue and net income hit the skids in 2020, Fortinet saw annual earnings growth of 35% and revenue growth of 20%. 

This year, Wall Street expects earnings per share of $3.74, up 12%. Next year, that’s expected to be $4.35, a gain of 16%.

At the company’s virtual investor day in March, Fortinet said it expects revenue to reach $4 billion by 2023. 

SD-WAN is short for “software-defined, wide-area network” technology. It serves a need very much in demand these days: Connecting a company’s various offices, as well as at-home workers. 

Corporations Change Approach To Security

This business line ramped up fast, with events of 2020 boosting Fortinet’s SD-WAN revenue. Billings in the category nearly doubled, to $355 million. 

Enterprise customers are changing their approach to cybersecurity and connectivity. That bodes well for Fortinet, whose firewall products have built-in SD-WAN. 

In addition, the SD-WAN rollout is a good move for Fortinet, as firewall business is slowing industrywide, as more and more enterprise users switch to cloud storage. 

Fortinet’s trade has been choppy since its earnings report after the close on April 29. However, much of that chop was due to a decline in the broader market. Fortinet, as a large cap, is part of the S&P 500 index, so it’s appropriate to gauge its performance to the broader index. 

Fortinet is down 2.78% in May, trading Thursday at around $198. As a point of comparison, the S&P 500 is down just 1.54% this month. 

That’s not a big enough discrepancy to become concerned about, especially with a company that’s situated in a growing industry, and one that’s in the spotlight these days. 

What Does Chip Shortage Mean?

One potential headwind is the global semiconductor shortage. In the April earnings call, chief financial officer Keith Jensen addressed that challenge. He discussed the products themselves within Fortinet’s inventory mix.

“One thing about Fortinet, in addition to having different form factors, is the inventory balances that we carry, a two times inventory turns, you’re looking at basically six months of inventory that we’re carrying on our balance sheet,” he said.

However, he acknowledged that supply chain issues related to chips will be a constant this year and into next year. “But I think in terms of when we sit down and talk about our expectations for the year, I think we have a fairly good understanding of how to work that in,” he added. 

Although this stock has a lot going for it, this is not the right time to buy, especially with the broader market in a correction. Downside volume has been lower than upside volume lately, which is a great sign for the stock. However, more selling could be ahead. 

There’s a great deal of chatter right now about investors being spooked by inflation, but the reality is: The stock rallied 42.37% over the past year and 32.65% year-to-date. After those rallies, it’s not surprising to see institutional investors take some profits and prepare for the next run-up.

The industry outlook is good, as well. Rivals in the firewall space include Palo Alto Networks (NYSE: PANW) and Checkpoint Software (NASDAQ: CHKP). Smaller cybersecurity stocks include Identiv (NASDAQ: INVE) and Proofpoint, which is being acquired by private equity firm Thomas Bravo.
Look For Fortinet To Post Double-Digit Earnings Growth In Next Two Years

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Shares of Wolverine Worldwide are down more than 10% from their recent high and in deep correction despite better than expected earnings and positive guidance.


4 min read


This story originally appeared on MarketBeat

Wolverine Worldwide, Inc Forecasts Strong Rebound 

Wolverine Worldwide, Inc (NYSE: WWW) and the shoe industry at large didn’t have a fantastic 2020. Like other retailers of apparel, there was little impetus for demand due to social distancing and work-from-home trends. At least in the beginning. Now, more than a year into the crisis, not only is the shoe industry at large posting a nice little rebound but the trends are accelerating. Assuming the reopening continues unabated we expect to see Wolverine World Wide outpace even its own updated and very positive guidance. 

“We believe 2021 will be a breakthrough year for the Company, and our first-quarter performance was an excellent start,” said Blake W. Krueger, Wolverine Worldwide’s Chairman and Chief Executive Officer “ … Our brands are well-positioned in trending, performance-oriented product categories like running, hiking, and work; and their momentum remains strong. We anticipate growth to continue to accelerate moving forward.”

Wolverine World Wide Falls On Market-Beating Results 

Wolverine World Wide had a great quarter and one in which sequential growth continued for the 4th quarter. The $510.7 million in net revenue is up 16.3% from last year and beat the consensus if only by a slim 25 basis point margin. Gains were driven by strength in the company’s two top brands as well as eCommerce. The Merrel brand saw its sales surge 25% while Saucony sales jumped 55% and eCommerce 84%. 

The revenue gains were translated into higher margins as well and despite the impact of upward price pressures. The gross margin widened by 210 basis points GAAP and 290 basis points adjusted to hit 4.3% and drive operating gains of larger proportion. The operating margins widened by 760 bps GAAP and 320 bps adjusted to drive significant improvement in earnings. At the GAAP level, the $0.45 in EPS is up 200% from last year and beat the consensus by 1000 basis points. At the adjusted level the $0.40 in reported earnings is up 55% but missed consensus by a penny, that’s the only bad news we could find. 

Guidance for the remainder of the year is equally positive if a little light in regards to earnings. The company upped its target for revenue to $2.24 to $2.3 billion versus the $2.23 consensus which is estimating 25% to 28% YOY growth. The adjusted EPS target was also increased but to a range that brackets the consensus with the consensus above the mid-point of the range. In our view, the guidance but possibly cautious in light of our expectation for the economic rebound. The Fed’s GDPNow tool is tracking Q2 GDP in the double-digit range and we think GDP could accelerate from there before it cools off. 

Wolverine Worldwide Could Increase Its Dividend 

Wolverine Worldwide is not a well-recognized dividend-grower but it does have a history of increases. Based on the Q1 results, the outlook, and the balance sheet we think the company could not only sustain its current payment but increase it as well. Not only is the payout ratio very low but free cash flow is good and on the rise too. The company paid down a substantial amount of debt over the past year that has improved liquidity, leverage, coverage, and FCF. If these trends continue the next dividend increase could be substantial as well. 

The Technical Outlook: Wolverine Worldwide Enters Correction

Shares of Wolverine Worldwide shed more than 8% and are on the verge of a deeper correction because of the Q1 earnings. The earnings weren’t bad, nor was the outlook, but what they were was not enough to spark buying in the face of a broader market sell-off. What this means is share prices for this stock are going to continue falling until finding a firmer level of support that can sustain price action until market conditions improve. In our view, this stock could fall another 10% to 12% before hitting major support but, if it does, we’d be buyers. At that price point, near $34 to $36, the stock would be trading about 17.5X to 18.5X its earnings at the low end of the range and present a much better value-to-yield.

Wolverine Worldwide, Inc Is A Buy On Post-Earnings Weakness 

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5 min read

Opinions expressed by Entrepreneur contributors are their own.


CEOs are not told the truth about the most vital corporate issues. The reason is simple: No employee wants to be the messenger who’s shot. Unfortunately, there is a high price to keeping the truth from the CEO — errors spread like a virus in the corporate body. One of the most malignant viruses is the high-placed, incompetent executive who leads a charmed life.

Don’t cross an incompetent employee

A former client recently said to me, “beware of crossing an incompetent employee; every such person has survived because he fulfills a purpose for someone else.” This comment caused me to reflect on the underlying reasons for a CEO to protect an employee who’s widely known to be incompetent at best and harmful at worst.  

One reason is obvious — a dirty secret. For example, the incompetent employee might have knowledge of financial misdeeds. Explicitly or implicitly, there might be a payoff for silence. If the person is capable of holding that leverage over their CEO, what could they do to you?

Related: 4 Ways Effective Leaders Deal With Incompetent People

The incompetent employee might be the CEO’s “security blanket”

A few years ago, I was advising a distressed company. One member of the executive team was clearly not equipped for his position. I asked his colleague on the executive team if he had addressed the problem with the CEO. The colleague became agitated and responded that he had raised the issue but the CEO had responded with such hostility that he feared returning to the subject.

Confident of my relationship with the CEO, I decided to take the bull by the horns. I was polite but firm and, I thought, persuasive. The CEO listened intently and assured me he would consider taking action. As I was leaving his office, the executive in question entered and asked if he could bring the CEO lunch. When I saw the CEO’s face, I knew my mission had failed. He was suddenly more relaxed and comfortable. The CEO did not need his employee to bring him lunch, but he needed him for comfort and security. The executive had been with him for years,  was dedicated to him, was totally reliant on him, and the executive was safety.

Later I extrapolated from this incident, and others I have observed, another reason why many incompetent executives are protected by CEOs. These executives have no power base in the company — no one respects them. An executive who is totally beholden to their patron will always do their bidding, thereby providing a reliable source of support and predictability for their boss. 

Related: 3 Signs That Managers, Not Employees, Are the Problem With Performance Management

The benefit to the CEO is a cancer to the organization

The benefit the executive provides, however, is a cancer to the organization: The incompetent officer serves the CEO, not the company. The CEO will give the employee latitude and perks denied to others. This disparate treatment and these inconsistent standards undermine trust among other employees — trust that’s vital if they’re expected to perform to their highest potential.

According to a Harvard Business Review article by Ron Ashkenas, subordinates respond with fear and sycophancy “if the boss is insecure or capricious.” To keep the executive happy, the CEO might even allow them to meddle in areas that are outside their nominal skill sets. Out of self-preservation, other employees fear challenging the executive or confronting the CEO, so the virus spreads throughout the organization. 

CEOs tend to blame external factors for their failures, such as a confluence of bad luck (the “perfect storm”), unreasonable lenders, the economy and so on (I have heard them all). But CEOs should recognize that often the fault lies not in the stars but in themselves. This is a hard message for them to accept, but the success of a company depends on the CEO’s willingness to act responsibly.

A CEO can overcome the problem

It is difficult for human beings to recognize their faults and weaknesses. Identifying the “security blanket” issue and taking the necessary steps is a challenge for a CEO. But there are clear indicators of problems if the CEO is not willingly blind: The “security blanket” employee will lack the respect of their peers and those with whom they interact. 

Let’s go deeper. What about a CEO who lacks even this self-awareness and ignores the signs?  Although personal growth would be ideal, it is not a programmatic solution. I suggest that the solution might be found by addressing the root of the problem — the isolation and insecurity of the CEO. The underlying problem can be overcome by having a trusted sounding board. 

Related: What Kind of Leader Are You Based on Your Emotional Intelligence?

An active, independent board would be best, but a confident advisor could fill the role. As Bill George explains in his article “Why Leaders Lose Their Way,” “Reliable mentors are entirely honest and straight with us, defining reality and developing action plans.” Neither the board nor the advisor should be employees or “yes men.”  They need to tell the CEO what they will not tolerate their employees to say, and what they hide from themselves. 

At the end of the day, however, no method will succeed unless the CEO is committed to the ultimate good of the company and possesses at least a modicum of self-awareness. The CEO must listen to their sounding board, examine their motivations and fears frankly, and then take the steps necessary to combat the virus lurking in their moldy security blanket.

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Duke Energy (NYSE:DUK) continues to charge higher on higher volume after a split result on its earnings report. The utility giant delivered earnings that beat analysts’ expectations.


4 min read


This story originally appeared on MarketBeat

Duke Energy (NYSE:DUK) continues to charge higher on higher volume after a split result on its earnings report. The utility giant delivered earnings that beat analysts’ expectations. The $1.26 EPS beat estimates for $1.24 and was a 10% year-over-year (YOY) gain. This was particularly significant since the company reported a four cents per share loss in their commercial renewables business due to the severe winter storms in Texas in February.  

However in what is becoming a bit of a too-familiar story, the company missed its consensus revenue target. The $6.15 billion was just 0.9% lower than estimates. And although this makes it four straight quarters that Duke has come in below revenue expectations, the income was 3% higher YOY.  

Investing in utility stocks is practical, but it’s not always very exciting. You’re getting defensive stocks that tend to perform well even when the economy is struggling. And in this case, when the economy is growing, utility stocks rise as well.  

This is a situation that investors can see playing out with Duke Energy which continues to earn its placee as a leader among utility stocks. DUK stock is up 25% in the last 12 months; it’s up 14% in 2021; and the stock is up 49% since the onset of the Covid-19 pandemic. 

Forward Guidance Remains On Track 

As the economy begins to strengthen, analysts are paying attention to a company’s forward guidance. If that’s the case with DUK stock, then investors have to like what they heard. The company reaffirmed its yearly estimate of between $5 and $5.30 adjusted EPS with a growth rate through 2025 of 5% to 7%. 

An ESG Investment You Can Bank On 

By now, you’re familiar with environmental, social and governance (ESG) investing. The phrase involves companies taking an active role in doing good things for the world around them. If you focus on the first word “environmental” then you can understand why DUK stock is so appealing. The company has plans to triple its renewable energy portfolio by 2030. And the company will be accomplishing that while delivering a 50% to 70% reduction in active coal units by 2030.  

Location, Location, Location 

One differentiating factor for Duke Energy at the moment is location. There were many skeptics that doubted the flight of Americans from select U.S. states. But the recent information from the U.S. Census has left no doubt. Population is shifting and Duke primarily operates in the Midwest and eastern states, including Florida and the Carolinas.  

These areas have gained during the pandemic. However, they have also been the target of upwardly mobile millennials prior to the pandemic. That’s a demographic that’s started to buy homes, which will be another catalyst for a utility stock.  

And Then There’s That Dividend 

Another reason to buy utility stocks is for the dividend. And Duke Energy offers one that’s among the best of the bunch. Although dividend investors know they shouldn’t assign too much importance to a dividend yield, Duke does offer an impressive 3.76% yield. However, more importantly, the company has increased its dividend for the last 14 consecutive years. Plus, over the last three years, Duke has increased its dividend by an average of 9.46%.  

Duke Energy Remains a Buy 

Over the next decade, Duke is well-positioned to be part of the country’s transition to renewable energy. And it stands to benefit from a renewed investment in the nation’s energy grid.  

Even with the company’s stock brushing up against the high end of analysts’ 12-month price target, DUK stock remains a solid performer. I expect to see improved price targets that will support a higher stock price. And investors will still have the opportunity to collect the company’s dividend.  

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6 min read

Opinions expressed by Entrepreneur contributors are their own.


Once upon a time, there was a young and scrappy entrepreneur who sent an email to a famous billionaire he didn’t know and ended up getting a $1 million investment.

This isn’t a fairy tale; it’s what happened when I sat at my desk one evening and decided to take a shot and email Mark Cuban. I’ve always admired his ideas and his approach to business, and I thought he’d appreciate my startup, SAVRpak, which helps keep takeout, packaged foods and produce fresher for longer. So I found his address, dropped him a note, and forgot all about it, thinking there was little-to-no chance the man who stars on ABC’s Shark Tank and owns the Dallas Mavericks would rush to answer my email.

A few hours later, while cooking dinner for some friends, I pulled out my phone to check something and, by force of habit, took a quick look at my inbox. And there it was. A reply from Mark Cuban. It was just a few words long, but I didn’t care; it was an invitation to an engagement, an engagement that, in my case, ended with Cuban becoming my investor.

I’ll be honest: If this wasn’t my story, and if I had heard the very tale I’m telling you now, I might’ve dismissed it as a one-off, some crazy fantasy that never really happens in the real world to guys like me. But having lived through this thrilling and deeply instructive experience, allow me to offer five pieces of advice on how you, too, can take the sort of initiative that might end with a very famous investor and a very large check in the bank.

Take the chance!

It might sound obvious, but it’s not. Anyone looking over my shoulder as I drafted that initial note to Cuban might have very well advised me not to waste my time. Such a critic might’ve noted that cold-emailing celebrity billionaires is hardly the most prudent and logical approach, and such a critic would’ve been right. But business, like life, isn’t always rational, and sometimes just jumping right in and making an ask defies logic and rewards the bold. So, as the old and wise slogan goes, just do it.

Related: Black-Owned Vegan Burger Brand Lands $300,000 Investment on ‘Shark Tank’; Reached Six-Figure Revenues Within 24 Hours

Treat it like a sport

How to do it, however, is an entirely different question, one that I can answer with great joy: Treat it like a sport. There’s a reason why so many business people are fond of using athletic metaphor, like saying a deal is a home run or that the negotiations are on the five-yard line. It’s because capitalism, like sport, is, at its best, a respectful and rule-bound, yet playful and muscular competition. My conversation with Cuban is a case in point: One or two emails into our conversations, the famously outspoken investor tried to rattle my confidence by dismissing the potential worth of my business. I remained polite, of course — you’d be foolish not to when talking to a man who knows a thing or two about business — but shot back with my own reply, which not only delivered facts and figures I thought Cuban should know but also showed him that I can play the game.

Related: The Shocking 4-Letter Word Mark Cuban Uttered on the Set of Shark Tank

Have a conversation

This leads me to my third point: When engaging a high-profile potential investor, you’re not really pitching; you’re having a conversation. Once Cuban was convinced that I was someone who knew his business and had the wherewithal to stand his ground and champion his own cause, he asked excellent and insightful questions and made great suggestions that I happily followed. I didn’t just try to sell him on my company; I listened, and this engagement is what took our exchange from a random back-and-forth online to a real and fruitful business relationship.

Of course, in business, like in, say, dating, you can hardly get very far unless you have a pretty good idea of what the other side likes. Before writing Cuban that first note, I spent a good bit of time reading up on him and getting a good sense of how he approached deal-making. I learned how he liked to communicate and what he considered to be an utter waste of time, which helped me hit the right notes early and make our interaction a meaningful one.

Related: 13 Million-Dollar Businesses That Turned Down ‘Shark Tank’ Deals

Have fun

Again, like dating, make sure everyone is having fun. For example, when Cuban wrote and tweaked me by suggesting that my company wasn’t worth as much as I believed, I didn’t respond with an indignant missive or a spreadsheet dense with numbers. I just sent him a sad face emoji before writing back a short and polite response stating my opinion. That silly little gesture isn’t the sort of tactic they teach you at business school, but it told Cuban a lot about me and how I approach life, showing him that I’m serious about business but also a down-to-earth guy who isn’t above a bit of banter when the occasion calls for it. This is exactly the sort of realness that moves a relationship forward fast, even — or especially — when the person you’re trying to court is one of the world’s busiest and most sought-after investors.

Follow these lessons, and you might not land a business partner of Cuban’s caliber, but I guarantee you’ll do much, much better than you would have otherwise. Trust me: If you take chances and have fun, do your work and stand your ground, engage and educate and enchant, you, too, will have your happily ever after. 

Related: The One Investing Tip From Billionaire Mark Cuban That’s Perfect For Entrepreneurs

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Putting your effort in upfront and collecting the returns forever after is the foundation of financial freedom.


12 min read

Opinions expressed by Entrepreneur contributors are their own.


Passive income has long been the holy grail for entrepreneurs looking to free up their time, untethering the cord of daily duties and responsibilities from the potential to generate healthy monthly revenues. While the importance of passive income isn’t often doubted, the monumental hurdle often required to achieve a respectable amount of cash flow from automatically-recurring revenue streams is often too great for most to bear.

Clearly, it’s hard to generate passive income. It requires the upfront investment of a significant amount of our time, usually with little to no returns for extended periods. We can go months and even years without a single dollar produced from passive income activities, making even the most astute entrepreneur shake their head in sheer and utter frustration.

The truth of the matter is that time is far more valuable than money. While money can be spent and earned, time can only be spent once, then it’s gone forever. As we age and grow older, we understand the importance of time and being able to freely choose what we do with those precious moments that we do have in life.

Related: 11 Ways to Make Money While You Sleep

 

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A developer asked the businessman for permission to create a video game about SpaceX and finally received a response.


2 min read

This article was translated from our Spanish edition using AI technologies. Errors may exist due to this process.


There is no doubt that perseverance does pay off. A video game creator set out to get Elon Musk’s attention and he succeeded! After 154 attempts to reach the CEO of SpaceX via Twitter , the enthusiastic programmer got a response.

The independent developer Lyubomir Vladimirov , promised to publish the same message for the daily businessman for a year. His intention was to ask Musk for permission to develop a game inspired by SpaceX , his space exploration company.

Dear Elon. I am a game developer and I am making a game about the colonization of Mars with you and SpaceX. If you think it’s cool, all I need is a ‘go ahead’ to use your name and logos. I will post this every day for a year or until I get a ‘yes’ or a ‘no’. 154/365 ” , says the video game creator’s post.

After 22 weeks of prodding, the CEO of Tesla finally heeded him and answered Vladimirov’s request.

“You can steal our name / logos and we probably won’t sue you ,” the Space CEO replied from his Twitter account.

 

 

After receiving the long-awaited response from Elon Musk , the tweeter promised that a good part of the video game’s profits would go to SpaceX .

“I want to give 80% of the profits from the game to SpaceX. In that way, the game will not only serve the important purpose of entertaining people and arousing their interest in Mars, but will also help Elon Musk and SpaceX to achieve this, ” wrote the programmer, who promised to show more progress soon.

Vladimirov has shown that he wasted no time while waiting for Musk’s permission. In his profile you can find several videos showing the interface of the game.

 

 

 

 



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5 min read


This story originally appeared on MarketBeat

U.S. mid-cap stocks are off to a strong start in 2021. The S&P 400 mid cap index is up 17% year-to-date compared to 11% for its large cap counterpart the S&P 500.

Many investors like to buy mid-cap companies because they reside in the sweet spot of the capitalization spectrum. Not too big, and not too small. This is where we find mature companies that are well-established in their respective markets but still have a lot of room to grow.

Here we highlight three undervalued mid cap companies that have a good chance of graduating to large cap status.

Is the Badger Meter Pullback a Buy Opportunity?

Not long ago Badger Meter (NYSE:BMI) was considered a small cap stock. Today, the $2.7 billion stock is hanging out with the mid cap crowd and may be on its way to the big leagues.

The Wisconsin-based company makes a range of products that measure water flow and related technology solutions. Its offerings are used by customers around the world to optimize water flow and be a part of the world’s push towards sustainable water usage.

Badger Meter is considered the global leader in the so-called ‘smart water’ market. Its smart water metering and flow measurement technologies are seeing record demand from utilities and industrial customers. In the first quarter of this year, the company posted 9% top line growth and exited the period with a record backlog of smart water product orders. The gross margin is also moving in the right direction and led to 15% EPS growth last quarter.

Just as the pandemic has accelerated many pre-existing trends like e-commerce and telemedicine, it has also sped up the adoption of digital smart water solutions. Water safety and security is an increasingly important issue for utilities and municipalities—and sales of Badger Meter’s electronic solutions should continue to benefit from these trends.

Badger Meter has a leading position in a smart water market that is viewed as an oligopoly. Over the next few years, software and electronics will increasingly be used to monitor water quality and for automated water reading in many parts of the world. This translates to international expansion opportunities for Badger Meter. The recent $20 pullback to the low $90’s screams buy opportunity for this mid cap growth winner.

Is Herbalife Nutrition Stock Undervalued?

On February 18th Herbalife Nutrition (NYSE:HLF) stock gapped lower after the company reported fourth quarter results that fell short of the Street’s expectations. Quarterly sales grew 16% but adjusted EPS fell 7% year-over year.

The market punished the stock in a classic case of nearsightedness. The bigger picture here is that Herbalife had its best year yet in 2020. Despite COVID-19 making in-person meetings a challenge for the company’s army of independent entrepreneurs, annual sales were the highest they’ve ever been.

Herbalife is benefitting from increased consumer interest in health and nutrition in the wake of the pandemic. It’s a trend that is only likely to get stronger as people stay vigilant about healthy eating and exercise habits to build immunity in the post-COVID world.

And as global employment trends improve people will have more money to spend on Herbalife’s weight management, specialty nutrition, fitness, skin, and hair care products. The fourth quarter overreaction also glazed over management’s raised guidance for 2021 and a new $1.5 billion stock buyback program.

This week Herbalife reported strong first-quarter 2021 results that got value investors rethinking the stock. Sales jumped 19% to $1.5 billion, and EPS jumped 71% to $1.42 (albeit with easy comparison to the prior-year quarter). Still, both figures beat the consensus expectations, and management once again upgraded its full-year outlook.

Herbalife stock gapped higher in heavy volume on the Q1 news which accompanied by a timely press release about 28 NFL draft picks having been trained with Herbalife products. At just 13x forward earnings, investors will want to make this undervalued mid cap a high draft priority.

Is Integra LifeSciences Stock a Buy?

Integra LifeSciences (NASDAQ:IART) is a $6.3 billion health care company that makes medical devices for neurosurgery, orthopedic joint reconstruction, and wound repair. It doesn’t take a brain surgeon to know that this stock is undervalued.

The 25x forward P/E is well below that of the medical device industry average as is the 4.5x price-to-sales ratio. Integra LifeSciences is trading near an all-time high but has pulled back this week after touching $77.40. The down volume has dwindled in each of the last four days since May 3rd suggesting the selloff is losing steam.

Buying the mid-cap here would give investors inexpensive exposure to a growing medical device company with an expanding product lineup and international growth prospects. Mainly through acquisition, Integra has broadened its product line in sync with trends in hospital demand. It bought regenerative medicine company ACell to strengthen its regenerative tissue and wound care product portfolio. Regenerative medicine is an area that is expected to be a strong source of growth for the company as spine and orthopedic elective procedures resume post-COVID.

Integra’s largest overseas market is the Asia-Pacific region which is seeing strong demand for surgical equipment and products as hospital operating conditions begin to normalize. Last quarter Integra posted double digit revenue growth in both China and Japan. These two markets along with other parts of Asia will be key growth avenues.

Look for Integra to capitalize on its international growth opportunities and derive growth from more value-added acquisitions that complement its product portfolio. Given the momentum in the business, it won’t be long before this mid cap stock trades in the $80’s.

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4 min read


This story originally appeared on MarketBeat

In true Rocky Balboa fashion, Rocky Brands (NASDAQ:RCKY) has picked itself off the mat and staged a remarkable comeback. Since the pandemic landed an uppercut and sent the stock below $20 for the first time since 2018, Rocky Brands has more than tripled.

The Ohio-based footwear company has been kicking butt over the past 12 months thanks to a string of knockout earnings reports and prospects for continued growth. After a strong start to fiscal 2021, Rocky Brands is now trading at an all-time high above $60. Is it too late to try on for size? 

What Does Rocky Brands Do?

Rocky Brands is a lesser-known consumer discretionary company, yet it has been making premium footwear, apparel, and accessories for almost 90 years. Its history on the public stock exchange dates back to 1993.

Its portfolio of in-house brands caters to a range of blue-collar customers from construction workers and outdoorsmen to military personnel and country-western types. In addition to its popular Rocky, Durango, Lehigh, and Georgia Boot products, it sells Michelin footwear through a licensing agreement. Yes, this is the same Michelin makes tires—and, in fact, the technology used to make the tires is the same used to make Michelin shoe soles.

Over the years, Rocky Brands has added to its brand lineup by reaching into unexpected corners of the corporate world. Earlier this year, it acquired Honeywell International’s footwear business for $230 million. It is best known for The Original Muck Boot Company brand and owns a leading outfitter for the commercial fishing market called XTRATUF that Alaskan fishermen have been sporting for decades. The deal will significantly boost to Rocky’s performance footwear lineup, sales, and is expected to be immediately accretive to earnings.  

How Did Rocky Brands Do in 2021 Q1?

On the heels of three consecutive big earnings beats, Rocky Brands was at it again to kickoff fiscal 2021. The company reported record first-quarter numbers that included 57% year-over-year revenue growth to $87.7 million. The wholesale business did particularly well growing sales 69% while the recovering retail business notched 42% growth. Sales in the much smaller third segment, Military, were up 16% to $4.4 million.

Adjusted net income was soared 344% to $8.7 million and adjusted earnings per share (EPS) came in at $1.19. This was the result of an impressive 5.4% gross margin expansion to 40.1%. It was also encouraging that Rocky Brands’ largest segment, Wholesale, experienced the largest margin expansion.

To be fair, however, Rocky Brands faced an easy comparison in Q1 given the impact of COVID-19 on the first quarter of 2020. The pandemic forced the temporary closure of the company’s manufacturing facilities and led to a $1 million operating expense.

Nevertheless, both the top and bottom-line results trounced analysts’ forecast of $71.3 million in revenue and adjusted EPS of $0.59. This along with management’s upbeat tone drove the stock up 15% as of midday Cinco de Mayo trading.

 Is Rocky Brands Stock a Buy?

Its hard not to like Rocky Brands. Not only does it have a strong, growing portfolio of high-quality footwear brands, but the company is shareholder-friendly. It pays a 2% dividend, an uncommon yield for a company its size (~$380 million). Management also recently announced a new $7.5 million stock buyback program that will take the place of the one that just expired.

With this said, Rocky Brands is getting a bit overheated. The stock is up more than 120% year-to-date compared to 21% for the S&P 600 small-cap index. It has also stretched outside the upper Bollinger band, an area that has historically been followed by a correction. Investors should therefore look for a better entry point on this one. Another low volume pullback like what we saw prior to this week’s earnings would be an ideal time to jump in.

But there isn’t a need to be too picky with the entry point here. That’s because Rocky Brands is still inexpensive at roughly15x forward earnings. This is considerably below the footwear and apparel industry average of 23x.

The two sell-side analysts that cover Rocky Brands both reiterated their ratings post-earnings, one being a buy, the other a hold. Their $65 and $68 price targets, however, suggest limited upside from here and confirms what the technical picture says about finding a better entry.

Rocky Brands in the low to mid $50’s would be a good time to step into the ring and ride a comeback Sylvester Stallone would be proud of.

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Digital media company LiveXLive Media (NASDAQ: LIVX) stock has been a bit of a rollercoaster experiencing extreme spikes and drops as a speculative play on streaming music and video content.


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This story originally appeared on MarketBeat

Digital media company LiveXLive Media (NASDAQ: LIVX) stock has been a bit of a rollercoaster experiencing extreme spikes and drops as a speculative play on streaming music and video content. The independent network offers music-related live and streaming audio and video content along with niche events like its “Social Gloves: Battle of the Platforms: YouTubers vs. TikTokers” pay-per-view boxing event, catering to social media fans and millennials. It also operates Slacker Radio and various podcasts. LiveXLive claims to have transcended the 1 million paying subscriber mark and always carries the potential for an acquisition if their portfolio is compelling enough. The Company is also trying to gain from the non-fungible token (NFT) momentum by opening an NFT division that will mint performances, video and audio content, and digital playing cards. This could be an up-and-coming viable network utilizing social media in an underground manner. This small-cap company is a purely speculative play suitable for nimble traders and seasoned speculators that can keep stop-losses and tolerate high-volatility and periods of thin liquidity.

Q3 Fiscal 2021 Earnings Release

On Feb.11, 2021, LiveXLive released its fiscal third-quarter 2021 results for the quarter ending December 2020. The Company reported an earnings-per-share (EPS) losses of (-$0.12) missing analyst estimates for a loss of (-$0.10) by (-$0.02). Revenues came in at $19.1 million versus $17.7 million consensus. The Company raised full-year fiscal 2022 revenue estimates to come in between $90 million to $100 million versus $91.3 million consensus analyst estimates.

Raised Guidance Estimates

On April 5, 2020, LiveXLive raised it’s full-year fiscal 2021 revenue guidance to a range of $64.5 million to $65.5 million versus analyst estimates for $64.09 million. Adjust fiscal 2021 operating income is expected between $1 million to $3 million. The Company expects full-year 2022 revenues to come in between $100 million to $110 million versus $99.13 million consensus analyst estimates. The Company ended Q4 and fiscal 2021 with over 1.075 million paid subscribers and has livestreamed over 140 live music events and 1,781 artists across the LiveXLive platform, generating over 150 million live stream views compared to 42 events, 256 artists and 69 million live streams in prior year. The Company saw 533% growth in its Q4 fiscal 2021 livestream views hitting 38 million versus 6 million views in the same year ago period. LiveXLive’s 24-hour linear OTT streaming channel reaches over 300 million people. It’s PodcastOne generated more than 2.25 billion downloads in 2020, with over 234 exclusive podcast shows and now produces more than 400 podcast episode weekly. Total social media reach across the exclusive PodcastOne talent roster exceeds 240 million.

Samsung Free and PodcastOne Deal

On April 9, 2021, LiveXLive inks a deal with Samsung (OTCMKTS: SSNLF) for all PodcastOne distributed content to be available on Samsung Free service via the Listen tab. PodcastOne President, Kit Gray stated, “Listening to all your favorite hosts and shows shouldn’t be more than a one tap process and our agreement with Samsung brings fluid accessibility to podcast fands in a new way.”

Growth Drivers

LiveXLive could be an up-and-coming network both in terms of digital streaming platform and its podcast network. In Hollywood, the saying “Fake it ‘til you make it” could apply here. In its Nov. 16, 2020 conference call, LiveXLive CEO Rob Ellin summed it up, “Today, LiveXLive has grown and evolved to be a leading talent-first platform focusing on connecting artists with their superfans, building long-term sustainable valuable franchises, audio music, podcasting, vodcasting, OTT and pay-per-view, live streaming and video on demand and our distribution, which continues to expand. LiveXLive’s 24 hour OTT streaming channel now has a reach of over 300 million people on platforms like Amazon Fire and Roku, Apple TV, SLING, Xumo, STIRR, and both Samsung Smart TVs and Samsung TV Plus.” It’s worth noting that LiveXLive has had a partnership with Tesla (NASDAQ: TSLA) for 8 years where LiveXLive subscriptions are pre-installed in every Tesla vehicle sold in America. The LiveXLive app is pre-installed in 85 other automobiles as well as major carriers including T-Mobile (NASDAQ: TMUS) and Verizon (NYSE: VZ). Time will tell whether the Company is hype or the real deal. 

LiveXLive Media Stock is a Risky But Compelling Streaming Network Play

LIVX Opportunistic Pullback Levels

Using the rifle charts on the weekly and daily time frames provides a precision near-term view of the playing field for LIVX shares. The weekly rifle chart uptrend peaked out near the $7.02 Fibonacci (fib) level and abruptly collapsed to the $3.38 fib support, which has proven to be a sturdy support area. The weekly 5-period moving average (MA) is at $4.04 with 15-period MA at $4.29 as the weekly stochastic tries to mini inverse pup lower. However, the recent spike to the $4.53 fib has stalled out the weekly downtrend until the daily rifle chart resolves its uptrend, which may be peaking out. The daily market structure high (MSH) sell triggered on the breakdown below $5.16. However, the daily market structure low (MSL) buy trigger sits at $3.91. The daily 5-period MA support overlaps at $4.24 but is on the verge of a potential MSH trigger if the $4.20 fib breaks. Nimble traders and seasoned speculators can monitor for opportunistic pullback levels at the $3.72 fib, $3.38 fib, $3.08 fib, $2.57 fib, and the $2.22 fib. As a small-cap stock, liquidity could be a problem so it’s important that only seasoned traders and speculators are suited for this high-risk stock.

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