Amazon Refrains From Announcing Actual Sales Figure; Analysts Remain Curious

The online shopping sales went great in the holiday season as per reports, however the retail giant refrained from giving out proper figures to the market

Amazon.com Inc does not seem to be doing whatthe industry analysts and shareholders in the company want it to do, as according to a recent press conference, the retail giant turned out to be rather covering the sales numbers and figures that it has scored in the holiday season. This factor has not only disappointed the analysts and investors, but it has also raised their curiosity as to what exactly has been done by the giant in the recent sales season. The Thanksgiving sales was being seen as a great catalyst to boost up sales of the company, but the details that were given by the giant in the press release did not mention anything which could help the analysts to make an opinion about how the company actually performed.

In a blog post that was made by Amazon management, it was seen that the retail giant experienced great sales for its Amazon devices which it mentioned in the social media post. As discussed by the management, it was seen that a great response by the public was received in the holiday season, which turned out to be one of the best seasons in terms of sales for the giant. Furthermore, it was also stated that the year over growth that was seen by the retail company in the sales was mind boggling, even though no numbers or figures were presented by the giant. This alone raised many concerned eyebrows of the industry pundits, as it is not usual that the e-commerce giant keeps away such important information from the shareholders.

Moreover, analysts are aware of the fact that Amazon business sometimes tends to tell only half the information to the press about its sales, but the most recent holiday season sales is something that the whole industry seemed to be waiting to hear, something that never happened. Investors have turned out to believe that there might be some important information that must be kept hidden from them by the company, but analysts are of the opinion that they should rather not doubt the potential that has been shown by the giant so far.

A report by Slice Intelligence informed that throughout the Black Friday Sales, Amazon shopping app experienced a heavier active user base which resulted in its sales gong up by a massive 7% as compared to the sales experienced by other online shopping platforms.  This has agitated the investors more as they cannot wait to know how much the company actually generated in the revenue’s department from the sales. 

Citigroup Receives A 'Buy' Rating By Merrill Lynch

When speaking of the banks currently operating in the United States, it will be seen that recently a lot of high end volatility was observed on the stock index right after a couple of new decisions were made by the Federal Reserve, which were to determine the way banks carried out their operations in the near future. The investors in the investment banks were keen to know how the changes will affect the banking system at large and it looks like Citigroup has already been given a raised stock value by some prominent analysts of Merrill Lynch equity firm.

Merrill Lynch analysts have been tracking down the changes that could be brought about by the changes in the interest rate getting raised by the government and it looks like things might just get better for Citigroup in the upcoming days, as analysts have suggested a raised price of around $65 to the Citigroup stock. This is majorly backed up by the positivity that was shown by the earnings that were released by the investment firm some time back. Furthermore, analysts also believe that for the book value of the stock, the value that should be considered should come around $60.

Citigroup bank has also managed to announce a revenue generation for the past quarter at $18.5 billion which did disappoint the investors for the obvious reasons that the revenue on a year over year basis fell by a huge 7% while the EPS remained at $1.42 for the quarter. However, there were some positives to be considered in the earnings call and it was most definitely the net income, which was reported at an increase of a colossal 23% as compared to the same quarter in the year before and was noted down at $4.2 billion.  

As for the more important things for the bank, the fact that Citigroup finance has worked out a successful plan of cutting down on costs and making its revenue generation still better is perfectly working out for the giant. The Merrill Lynch analysts also believe that the bank will soon be coming right up to the target of achieving its Return On Assets for the current year and when it does, it will still be in a better position than before and its stock price might also increase as well.

On a completely different side, the EPS targets for the next quarter have been lowered down by most of the analysts, where first it was $1.25 and after the amendments, it has now been made to $1.16.

Merrill Lynch Rated Citigroup Stock As Buy

Citigroup has already been given a raised stock value by some prominent analysts of Merrill Lynch equity firm

When speaking of the banks currently operating in the United States, it will be seen that recently a lot of high end volatility was observed on the stock index right after a couple of new decisions were made by the Federal Reserve, which were to determine the way banks carried out their operations in the near future. The investors in the investment banks were keen to know how the changes will affect the banking system at large and it looks like Citigroup has already been given a raised stock value by some prominent analysts of Merrill Lynch equity firm.
Merrill Lynch analysts have been tracking down the changes that could be brought about by the changes in the interest rate getting raised by the government and it looks like things might just get better for Citigroup in the upcoming days, as analysts have suggested a raised price of around $65 to the Citigroup stock. This is majorly backed up by the positivity that was shown by the earnings that were released by the investment firm some time back. Furthermore, analysts also believe that for the book value of the stock, the value that should be considered should come around $60.
Citigroup bank has also managed to announce a revenue generation for the past quarter at $18.5 billion which did disappoint the investors for the obvious reasons that the revenue on a year over year basis fell by a huge 7% while the EPS remained at $1.42 for the quarter. However, there were some positives to be considered in the earnings call and it was most definitely the net income, which was reported at an increase of a colossal 23% as compared to the same quarter in the year before and was noted down at $4.2 billion. 
As for the more important things for the bank, the fact that Citigroup finance has worked out a successful plan of cutting down on costs and making its revenue generation still better is perfectly working out for the giant. The Merrill Lynch analysts also believe that the bank will soon be coming right up to the target of achieving its Return On Assets for the current year and when it does, it will still be in a better position than before and its stock price might also increase as well.
On a completely different side, the EPS targets for the next quarter have been lowered down by most of the analysts, where first it was $1.25 and after the amendments, it has now been made to $1.16.

IBM Corp To Announce Earnings On October 19

The software company is all set to announce its earnings on October 19, which will determine the sentiments investors should be having towards the stock of the company

International Business Machine Corporation has witnessed some important highs in the recent times, in which the giant has experienced a rise in the stock price coming around at 5 percent, which has also been appreciated by analysts who are covering the stock of the company. Despite the increase, it was also seen that the shares of the tech giant observed a lower than 6 percent share values on a year to year basis. In the quarter before the current one, the revenue that was collected by the giant came around to be at a drop of 32 percent in the hardware department, whereas the software sales also dropped which brought a downfall to the revenue by 10 percent, another alarming figure to be taken into consideration by the giant.

Analysts who are looking at the IBM stock closely are talking about how the shareholders will be able to know what the stock holds for them once the earnings are released on October 19. Keeping in mind the kind of sales it has recently been making the industry, most of the equity analysts are expected to downgrade the giant’s stock for the earnings call. However, for analysts who choose to focus on the dividend yield that is offered by the management of the company at around 3.5 percent, are sure to upgrade the stock of the firm in the near future.

The CEO of IBM, Ginni Remetty, has spoken to the press on a lot of occasions and has expressed how the slow shift of the company from old school computers to the new technology is what has made the firm a little backward in the tech industry. In the same manner, rival Microsoft has also gone through the same efforts of trying to keep up with the fast moving changes in the industry, which has been on the giant’s expense for a really long time.

The tech and software giant, however, is not thought to be working up to Microsoft’s level so far as it has still not grasped the massive changes being made in the cloud computing business. However, the giant has still been growing in terms of its data storage network. According to its previous quarter, the growth has come out to be at 20 percent, which is being considered by the analysts to be more than what Microsoft has achieved, even though it is supposedly on top of the cloud and tech business when it comes to production of PCs.

Petrobras Corruption Losses Surpassed $5.3 Billion

Petrobras may have lost more in the corruption scandal than it previously revealed

Petroleo Brasileiro SA-Petrobras has been involved in a corruption scandal took place in April last year. An investigation was started in March 2014, followed by prosecutors’ alleged ex-officials of the company of working a contract kickbacks arrangement, together with a number of suppliers who charged excess amount to the Brazilian oil company for its schemes.

Falling prices of oil and the scandal have left the company struggling, along with Petrobras taking around impairment charges of around $17 billion in April this year, shown in its financial results. The company said, $2.1 of the charges was linked to overpayments in the corruption outrage.

However, a federal prosecutor of the country Deltan Dallagnol believes that the corruption related overpayments applied this year was “just the tip of the iceberg.” On Friday, Mr. Dallagnol said that the real losses of corruption might exceed $5.32 billion, as per Reuters. The forecast accounts for complete losses along with the illegal profit made by construction companies from charging extra to Petrobras, said Mr. Dallagnol.

Mr. Dallagnol leads the interrogation into Brazil’s biggest scandal and is amongst the Brazilian task force. Over 100 people have been arrested since the start of the corruption investigation including major company and political figures.

As he believes the real amount loss to be higher than two fold, shareholders are concerned regarding the additional possible impairment charges.

As the company faced the corruption scandal, the situation gets worse by a significant decline in oil prices, caused by increasing supply of oil across the globe. Crude oil prices declined from more than $100 bpd last year to 6 years lows to approximately $37. Presently, WTI futures stand at $49.63 a barrel, whereas Brent oil stands at $52.65 a barrel.

Due to the corruption scandal the company has witnessed significant losses. Petrobras stock which went up to $19.57 last year in August has declined to $5.66 currently. In the last 12 months, the company’s stock has lost approximately 70% of its market value, as corruption related news derailed its production plans and growth.

Petrobras stock news suggests that in spite of positive movement of stock price at the moment, the company witnesses’ major challenges. Petrobras debt burden is more than $20 billion, which is the highest debt for any energy company across the globe. The scandal is still a big challenge. As economy of Brazil is remains uneven, the company has a bumpy long road ahead of itself.

Credit Suisse Upgraded McDonald's Corporation Stock

McDonald’s Corporation stock trades are in the green today, following an upgrade at Credit Suisse.

Credit Suisse upgraded McDonald’s Corporation stock yesterday, resulting in pre-market gain in the value of the stock. Jason West, an analyst for the sell side firm raised the price target by $12 to a new price target of $112, and updated the stock from Neutral to Outperform.

The analyst cited in the research report that though the Chief Executive Officer of the fast food company has declared various financial and operational steps that McDonald's will take, so the coming period will witness additional improvements. The analyst also said that the checks reflect a progress in the same-store sales in the United States, which has not been accounted for in the analysts’ expectations for McDonald’s stock.

The stock has not performed up to the market standard, as it stayed flat since 2011. While, the analysts expects the present risk reward standing for McDonalds stock looks attractive. The experts expect a 2% to 3% downside and 20% of upside potential.

The analyst provided three main reasons to clarify the upgrade. Firstly, a progress in the sales will be a key driver for the company’s stock upside movement. The fast food company has previously specified that it believes the international same-store sales to become affirmative by the third quarter of fiscal year 2015. Secondly, the company has an upside of 5% to 6% to the forecasts for 2016, driven by higher SG&A, SSS cuts. Lastly, he mentions that if the stock fell from its present price level, it will be supported by the expected dividends stream.

The price target of $112 is computed by using a Direct Cash flow based valuation model, using weighted average cost of capital of 7.5% and an EV/EBITDA multiple of 12 times. The price target implies a multiple of 13 times for the estimated EBITDA for FY16 and a 22 times multiple for the earnings per share estimate for the similar period.

The analysts believe that the price target does not entirely account for the bull-case earnings. He also said that an enhancement in investors’ sentiment is likely, as McDonald's has successfully managed to converse years of downgrade earnings and weak same-store sales. 

McDonald’s stock news shows that the Street is bullish on McDonald’s stock with 20 out of nearly 32 analysts rating the stock as Hold, nine giving a Buy rating and 3 giving it a Sell.

The average price target for the stock is $103.63; reflecting 8% of upside potential from the current closing price. 

Netflix Stock Update By Sell-Side Firms

Despite mounting competitive threats from established and budding streaming rivals, the Street is considerably bullish on Netflix’s prospects.

Netflix Inc. stock has dropped nearly 17% since mid-August due to enormous pressure from streaming competitors. Regardless of shareholder concerns over the company’s leadership position, equity analysts at the Street’s remain bullish on the streaming giant’s stock.

The Service Video on Demand (SVOD) has now become a well-known household name in the United States, achieving substantial diffusion in the country. While, nearly two thirds of the households are not even subscribed to the service. Therefore, as the company increases in popularity, the overall addressable market might churn out number of subscriber’s for Netflix domestically.

Moreover, its global expansion strategy portend well for substantial growth in the long term. The streaming giant has plans to make its service available to an overall of 200 nations by the end of next year. Once the international rollout is done, the streaming giant might see substantial growth by the addition of subscribers in the global market. This will result in higher revenue growth.

The streaming giant recently disclosed its plan to introduce its service in four critical market in Asia, namely Hong Kong, South Korea, and Taiwan by the start of next year. Analysts are optimistic that these launches of new services will help the company in maintaining strong subscriber growth over the coming few years.

According to the data gathered by Bloomberg, out of 45 analysts having coverage to Netflix stock, over 50% are bullish of the company’s stock. 23 gave it a Buy, 16 recommend a Hold, while only six suggested a Sell rating to the stock. The average twelve month consensus price target stands at $117.38, reflecting 14.8% upside potential in the coming future.

Jeffery Wlodarczak, an analyst at Pivotal Research Group LLC holds a bullish target price on the stock. Mr. Wlodarczak suggests a rating of Buy on Netflix stock and expects stock to increase to $175 mark next year reflecting an upside potential of over 71% from the present price levels.

On the other hand, Michael Pachter of Wedbush Securities continues his bearish outlook on the stock. He recommends $40 price target with an Underperform rating.

However, majority of popular equity Investment Company’s hold a positive viewpoint for the company. Morgan Stanley assigns $127 of price target, JP Morgan suggests it at $127 while Credit Suisse and UBS place target price of $110 and $143, respectively.

The stock year-to-date performance also showed its growth and following appreciation in price. Netflix stock news reveals that the stock was down 1.46% to $102.24.

Jefferies Reiterate Buy Rating On CVS Health Stock

CVS reports strong quarterly results for 2QFY15, leading to a positive outlook on the stock from Jefferies

CVS Health Corp. announced its second quarter results for fiscal year 2015 earlier last week. However, the stock declined during the trading session, after the earnings release, it started to recover the next day. The earnings announcement resulted in many sell side firm to revise their viewpoint on the company’s stock. Here is what Jefferies think about the stock.

CVS Health Corp. was able to report adjusted earnings of $1.22 per share for the recent quarter, surpassing analysts’ estimates by almost 2.6 cents. The company beat analysts’ expectation for the fifth time in a row. The figure enhanced by $0.09 year over year, as adjusted earnings for the prior year quarter was $1.13 per share.

The revenue for the company came in at $37.17 billion, despite of strong growth, it fell short of consensus estimate by 0.01%, and this was the first revenue for the company in past 13 quarters. The revenue figure for the period reflected a year over year growth of over 7%.

Jefferies has given the stock a Buy rating, with a price target of $125. The firm’s analyst having coverage on CVS stock believes more than expected retail, strong growth in Rx, and a robust beginning to pharmacy benefit manager for the current year is the main reason for the bullish stance on the company’s stock. For pharmacy benefit manager, CVS has announced gross latest business wins of around $12 billion up till now, together with $11 billion in net wins. Adding to this, the specialty Rx growth of 28% has surpassed growth in the division.

Investors’ negative reaction after the earnings announcement was primarily because of the reduction in guidance by the company’s management for third quarter. However, according to analysts it should not bother investors, as CVS has much of its emphasis on acquisition this year. CVS Health has also cut $1 billion from the amount due for share buyback to support funding of its Omnicare and Target Pharmacy acquisition.

The $125 price target given by the sell side firm uses a 20.5x of multiple for price to earnings ratio, using the expected figures for FY16, according to CVS stock analysis.

The Street is still bullish on company’ stock. Almost 28 analysts at Bloomberg covered the stock, 25 gave it a Buy, 3 rate it a Hold, while none suggests it a Sell rating, as reported by CVS stock news. The consensus price target is $119.35, which shows a 7.5% of return potential compared to current closing price.

RBC Capital Markets analyst Fran G. Morgan is most bullish with an Outperform rating and target price of $132 on the stock, while Morgan Stanley analyst Ricky Goldwasser is the most bearish with $111 target price and Overweight rating.

Gilead Sciences Inc. Recent Bull Pattern Might Not Last Long

The bullish pattern of the leading biotech company’s stock has been continuing since early May; it has however come to an end with the recent hit on June 25

Gilead Sciences, Inc. is the definite leader of the rapidly increasing Hepatitis C market, but with growing competition against its best seller Harvoni and Sovaldi, Hepatitis C drugs, it would see its bull period reaching to an end quickly.

Since the start of last month, Gilead Sciences stock has gained roughly 18.89%, and earlier this month the bull pattern increased as the share price surpassed its last year’s high and reached a new record high of $123.37 last week. The stock of the company has also been substantially outshining the shares NASDAQ Biotech index, which has gone up by 11.72% from the beginning of May till June 26.

Gilead share has gained a heavy 18.89% in the similar period. The Gilead's stock was also expressively more than the S&P 500 Index that has only gained 0.77% during the similar time period. However, June 25^th marked an extreme hit to the top biotechnology stock as it captured around 2% to reach the lowest stock price of $119.81, followed by a large number of stock selling, the upside potential stock trader has been much below the mean since it touches its lowest stock price.

The latest hit to the Gilead stock can mainly be due to the increasing success rate of its biggest competitor, AbbVie Inc.’s HCV drug namely Viekira Pak. The latest results from a late stage clinical test shows a 100% cure rate for the use of Viekira Pak, whether or not it is used in combination with ribavirin. This development is the biggest threat to Gilead Sciences Hepatitis C drug , Sovaldi, which has to be administered along with ribavirin only.

The stock is going down since then, the company’s share traded low on Friday and closed at $119.50. The momentum of the stock is dying out now, showing the fact that shareholders are not interested to bid higher stock prices.

The hit shows the level of the blow rivals’ progress in the HCV field can trouble Gilead in the upcoming years as well. Another rival of Gilead, Merck & Co. is planning to introduce a shorter treatment drug for HCV, which is most likely to impact the company’s stock when it will get launch.

However, the sell side firm is significantly bullish on company’s stock. Almost 28 analysts covered Gilead stock, out of which 23 gave it a Buy, 4 assigned a Hold; while just one recommend a Sell rating. The twelve month stock price recommended by analysts stands at $123.79.