McCormick (MKC) Q1 2019 Earnings Conference Call Transcript

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McCormick (NYSE:MKC) Q1 2019 Earnings Conference CallMarch 26, 2019 8:00 a.m. ET

Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:

Kasey Jenkins -- Vice President of Investor Relations

Good morning. This is Kasey Jenkins, vice president of McCormick investor relations. Thank you for joining today's first-quarter earnings call. To accompany this call, we posted a set of slides at ir.mccormick.com.

[Operator instructions] We'll begin with remarks from Lawrence Kurzius, chairman, president, and CEO; and Mike Smith, executive vice president, and CFO. During our remarks, we will refer to certain non-GAAP financial measures. These include information in constant currency as well as adjusted operating income, adjusted income tax rate and adjusted earnings per share that exclude the impact of special charges and for 2018, transaction and integration expenses related to the acquisition of our Frank's and French's brands as well as the net nonrecurring income tax benefit associated with the December 2017 U.S. tax reform legislation.

Reconciliations to the GAAP results are included in this morning's press release and slides. In our comments, certain percentages are rounded. Please refer to our presentation, which includes the complete information. In addition, please note that all comparisons discussed today, both for results and outlook, are calculated from a 2018 date that had been recast for the two accounting standard updates we adopted on a retrospective basis in the first quarter of 2019 as well as for certain other reclassifications noted in this morning's first-quarter results press release.

Please refer to the recast 2018 financials section of the press release and the Form 8-K we furnished on March 11 for further detail as well as the filing of our Form 10-Q later today, which reflects all the changes to our previously reported 2018 results and the historical financial information that has been recast. As a reminder, today's presentation contains projections and other forward-looking statements. Actual results could differ materially from those projected. The company undertakes no obligation to update or revise publicly any forward-looking statement, whether because of new information, future events or other factors.

As seen on Slide 2, our forward-looking statement also provides information on risk factors that could affect our financial results. It is now my pleasure to turn the discussion over to Lawrence.

Lawrence Kurzius -- Chairman, President, and Chief Executive Officer

Thank you, Kasey. Good morning, everyone. Thanks for joining us. Our first-quarter results were a great start to the year, delivering sales, operating income and adjusted earnings-per-share growth as well as margin expansion.

Our successful execution of our strategies and engagement of employees around the world has driven strong performance across both of our segments, and we're confident they will continue to drive our momentum and success as we go through the year. Starting on Slide 4. Our broad and advantaged global flavor portfolio continues to position us to meet the demand for flavor around the world and grow our business. Among our first-quarter highlights across our portfolio, we drove growth on our consumer segment with the strength particularly in the U.S.

spices and seasonings, recipe mixes and new Frank's and Zatarain's frozen products as well as in China sauces and chicken bouillon. In our flavor solutions segment, our Americas and EMEA regions drove significant growth in flavors, branded foodservice and condiments with strong contributions from both new products and the base business. We are confident our breadth and reach will continue to differentiate McCormick and be the foundation of our sales growth as consumer demand for flavor continues to rise. No matter where or what you choose to eat or drink, you will probably enjoy something flavored by McCormick every day.

Now let me go into more detail on our first-quarter performance, as seen on Slide 5, as well as provide some business comments before turning it over to Mike, who will go more in depth on the quarter-end results and the details of our 2019 outlook. As we said on our year-end earnings call in January and at CAGNY in February, we had confidence in our strategies and are well-positioned to deliver strong results in 2019. You can see this beginning with our first-quarter performance with the strong sales growth, operating profit growth, margin growth and EPS growth. Starting with our top line for the first quarter.

Versus the year-ago period, we grew sales 1%, and in constant currency, sales grew 4% for the total company with strength in both segments. This growth was due to higher volume and product mix and was entirely organic, driven by the base business and new products as we have no acquisition impact in the quarter. In our consumer segment, sales were flat, including an unfavorable impact from currency, and grew 3% in constant currency. In our flavor solutions segment, sales grew 3%, and in constant currency, grew 6%.

In addition to our top-line growth, we grew adjusted operating income and expanded our adjusted operating margin. With our higher sales and cost savings led by our Comprehensive Continuous Improvement Program, or CCI, we grew the first quarter's adjusted operating income 4%, or 6% in constant currency, and expanded our adjusted operating margin 40 basis points. At the bottom line, our first-quarter adjusted earnings per share of $1.12 was 12% higher than $1 in the first-quarter of 2018, driven primarily by our adjusted operating income growth and the lower adjusted tax rate. And this 12% adjusted earnings-per-share growth includes an unfavorable impact from currency.

Our solid first-quarter results were in line with our expectations and our outlook for our 2019 performance, which we shared on our January earnings call, continues to be strong. I'd like to turn now to a business update with a focus this morning on highlights from our consumer and flavor solutions segments, our exciting new products for the first half of 2019, and finally, touch on some of our recent announcements. Turning on Slide 6 with our consumer segment. As I just mentioned, we grew constant currency sales 3% with increases in each of our three regions.

In the Americas, we grew constant currency sales 3%, driven by higher volume and product mix. In the U.S., the unusual impacts we had in the fourth quarter, as we previously indicated on our January earnings call and at CAGNY, are behind us. Our IRI data indicates U.S. spice and seasonings scanner scales through multi-outlets grew 4% for the category and 5% for McCormick branded, reflecting a continuation of the strong consumption and share trend improvement realized in the fourth quarter.

In fact, we grew spice and seasoning share in the first quarter. Our performance on the market is being driven by new products and expanded distribution, together with our strong marketing programs and merchandising execution. Additionally, we again had strong growth in unmeasured channels, including club, e-commerce and Hispanic retail chains. Overall, combining strong consumption growth in other parts of our U.S.

branded portfolio with spices and seasonings, we continue to see an acceleration in our consumption trend, which shows we're winning with consumers across our portfolio. McCormick branded dry recipe mixes continued their momentum of consumption and share growth, and Stubb's barbecue sauce consumption growth again outpaced its category. Frank's RedHot sauce, Grill Mates and Lawry's marinades all grew consumption, partially driven by leveraging Super Bowl marketing and promotional programs across our condiment portfolio. New products, including Frank's RedHot frozen wings and Zatarain's frozen items, are also gaining momentum and contributed to first-quarter growth.

As I mentioned, our strong marketing programs contributed to driving our growth. We've also increased our effectiveness and are getting more value out of each marketing dollar. In the first quarter, we funded increases in our working media with decreases in our nonworking spend. Our newly formed marketing excellence organization, which I discussed at CAGNY, is optimizing our brand marketing spend and driving greater speed and effectiveness.

For instance, with our innovative approach for Frank's brand support, we had a big win on Super Bowl Sunday. We spent significantly less than the cost of a Super Bowl commercial and leveraged the power of social media with a strong creative idea. With our playful splat, Frank's garnered over 250 million consumer impressions and was awarded Twitter's brand interception award for driving the highest percentage of branded conversations during the big game without a national television ad. Not only did we win the award, we won with significant Frank's consumption growth.

Now turning to the Europe, Middle East and Africa, the EMEA region. Constant currency growth was driven by new products as well as expanded distribution and successful promotional activity. New product launches in the U.K. in the second half of the year, first choice, our brand renovation initiative, and Street Food Seasonings, which are adventurous flavors for millennials, continue to do well and we're excited to build on strong early results with continued expansion to additional markets in 2019.

In the Asia Pacific region, our constant currency growth was led by China, driven by new products as well as the base business growth due to successful merchandising execution and expanded distribution. We're also excited about the momentum we're gaining on Frank's and French's. At the end of the first quarter, products with localized Chinese labels are beginning to be listed in retail stores, and we expect distribution to build over the year. Turning now to Slide 7.

In our flavor solutions segment, our sales performance was excellent. Our constant currency sales growth was 6%, driven by higher volume and product mix on base business as well as new products in the Americas and EMEA regions. We're continuing to win with our customers through new products, expanded distribution and promotional activities. In the Americas, we drove constant currency sales growth of 7%.

We had strong sales growth to quick service restaurants as well as in our flavor product category. Our flavor sales were driven by snack seasonings, particularly due to new products and our customers' promotions, and by products that deliver the clean label and better-for-you attributes our customers are seeking. We also had strong branded food-service growth, driven by an increased distribution with national and regional customers, promotional activity with operators and expansion in emerging channels. In branded foodservice, we continue to realize the benefit of leveraging our full portfolio of McCormick spices and seasonings and Frank's, French's and Cattlemen's products across operators.

Our sales growth in EMEA was outstanding, 9% in constant currency. It was broad based across the portfolio, both from a product category and customer perspective. The momentum we built in this region last year carried into the first quarter. We drove sales growth to quick service restaurants, partially due to their strong promotional activities, and to packaged food companies with new products being a key driver.

Our new products are an important point to differentiate our brands and drive growth. Now I am happy to share with you our consumer segment's robust plans for new products in the first half of 2019 as seen on Slide 8. We're delivering against consumer demand for healthy options and transparency in the quality and source of ingredients. In the U.S., we have launched the Zatarain's Garden District Kitchen range.

These meal solutions, inspired by the rich culinary heritage of New Orleans, are plant based and high in both protein and fiber, and we continue to renovate our dry recipe mixes for simple and clean ingredient statements that still deliver delicious flavor. We are continually improving our portfolio to strengthen our relevance with consumers. In the U.S., we're expanding our McCormick Gourmet line with a range of premium salts and peppers. In France, we launched a range of Ducros, grown in France herbs for the French consumer who values provenance and local sourcing.

And in China, we are relaunching our packaging of new graphics that drive premium perception and better shelf visibility. With this inconvenience remaining a key driver of consumer trends, we are offering consumers convenience with flavor. In the U.S., we've launched new Grill Mates marinade flavors, which provide a convenient way to introduce bold flavors to grilling, and French's dipping sauces, which deliver fantastic taste with the convenience of ready to eat. We've also launched Zatarain's frozen entrees rice bowls, made with clean ingredients and leveraged the popularity of cilantro lime with shrimp and chicken.

And we'll be launching our ONE product platform, a set of one-dish recipe mix flavors to make dinners easy, which includes new flavors created using the combination of artificial intelligence and our consumer insights. And finally, we continue to introduce new flavors and varieties to drive flavor exploration and experimentation. In Canada, we're innovating our line of La Grille barbecue sauces with a new bottle and reformulated flavors. In the U.K., we're targeting the millennial consumer with the launch of a new range of rapid recipe mixes, which capitalize on the sandwich wraps trend at home and in restaurant menus.

And also targeting the millennial consumer, we're launching a new range of co-branded Tasty-McCormick recipe mix blends in the U.S., Canada and the U.K., which I will expand on further in a few minutes. Turning to flavor solutions on Slide 9. While we do not get specific with our product development in this segment, we're continuing to capitalize on our culinary foundation and customer collaboration, both of which differentiate us with customers. This unique combination allows us to continue our new product momentum as our customers continue to move their portfolios to on-trend flavors and more natural and better-for-you product, while ensuring that taste is not compromised.

We have a broad portfolio of product platforms and technologies to deliver a range of natural solutions for our customers. Along the natural flavor spectrum, clean flavor is the next emerging space. We're excited to have relaunched our new clean and natural platform, FlavorReal. McCormick is setting the benchmark for development of on-trend, organic, non-GMO and better-for-you products with our unparalleled natural ingredient supply chain and technologies enabling clean label transparency.

To support the consumer movement to healthier and more natural, our proprietary modulation technology called FlavorFull solves common flavor challenges, including masking bitter or sour notes and enhancing sweet, salt or fat. We can solve for any low or no challenge without sacrificing iconic flavor. And finally, our two flavor delivery technologies deliver optimal flavor experiences. Our patented FlavorCell is a controlled-release encapsulation technology designed to deliver flavor where and when and how you need it, while our FlavorSpice technology delivers flexible natural replacements for ground spices and herbs for increased concentration and solubility.

Our strategy to begin with understanding real food and beverage to create authentic flavors, combined with the breadth of our product platforms and technologies, is driving our new product wins with our customers with sales from product launches a key growth driver on our first-quarter results. Now I'd like to highlight some recent news on Slide 10. As announced in early February, McCormick has partnered with IBM to pioneer the application of artificial intelligence, or AI, for flavor and product development. We're entering in a new era of flavor innovation.

This proprietary cutting-edge technology, which we have previously discussed as computational creativity, sets McCormick apart across our consumer and flavor solutions segments. Our product developers are now able to explore flavor territories across the globe more quickly and efficiently, utilizing technology to extract key insights for millions of data points across sensory science, consumer preference and flavor palette. As we continue to expand the use of this system, we've launched our first AI-enabled consumer product platform, ONE, which I mentioned a few moments ago, in my new product comment. I also mentioned earlier a new range of co-branded Tasty products, which I'd like to expand on further.

During the first quarter, we launched a global partnership with BuzzFeed Tasty, the No. 1 cooking video website in the world for millennials and Gen Z with over 2 billion views a month. This partnership allows us to gain significant reach as we are now the official spice in the videos and recipes these generations use, while seeking recipe inspiration through social media. In the second quarter, we will be launching our Seasoning Blends range, which will be available both through the direct-to-consumer channel and retail.

We're thrilled with this new partnership, which will deliver substantial incremental impressions and reach to an audience primarily under 35 years of age and further accelerate our digital platform. In February, we were recognized on Barron's 2019 100 Most Sustainable Companies list for the second straight year. At McCormick, we're driven to do the right thing for people, communities and our planet and as such, we're recognized as a leader in sustainability. On a final note, I'd like to acknowledge Mike Fitzpatrick, who is retiring from our board of directors after serving as a director since 2001.

We sincerely appreciate Mike's contributions to our success over the last 18 years and thank him for his service. Now I'd like to provide a few summary comments, as seen on Slide 11, before turning it over to Mike. At the foundation of our sales growth is the rising consumer demand for flavor. We are aligned with the consumer's increased interest in bolder flavors, demand for convenience and focus on fresh, natural ingredients as well as with emerging purchase drivers such as greater transparency around the sourcing and quality of food.

With this increased interest, flavor continues to be an advantaged global category, which combined with our execution against effective strategies, will drive strong results. We have a solid foundation in an environment that continues to be dynamic and fast paced. We're ensuring we remain agile, relevant and focused on sustainable growth. Our experienced leaders and employees are executing against our strategies, which are designed to build long-term value for our shareholders.

Our first-quarter financial results across both our consumer and flavor solutions segments were a great start to the year. We delivered these results according to our plans and are excited by our momentum. Our fundamentals are strong and we're confident the initiatives we have under way position us to continue our growth trajectory. We're balancing our resources and efforts to drive sales with our work to lower cost to build fuel for growth and higher margins.

We have confidence in our fiscal-year outlook and are well-positioned to deliver another strong year in 2019. Around the world, McCormick employees are driving our momentum and our success, and I thank them for their efforts and engagement. Thank you for your attention, and it is now my pleasure to turn it over to Mike for additional remarks on our first-quarter financial results and 2019 outlook.

Mike Smith -- Executive Vice President and Chief Financial Officer

Thanks, Lawrence, and good morning, everyone. As Lawrence indicated, we delivered strong growth with our first-quarter results. I'll begin with a discussion of our results and then follow with details of our full-year 2019 financial outlook. Turning on Slide 13.

We grew sales 4% in constant currency. And as Lawrence mentioned earlier, this was entirely organic growth driven by the base business and new products as we had no acquisition impact in the quarter. Both our consumer and flavor solutions segments delivered strong top-line constant currency growth driven by volume and product mix. The consumer segment grew sales 3% in constant currency with growth in all three regions.

On Slide 14, consumer segment sales in the Americas rose 3% in constant currency versus the first quarter of 2018. As Lawrence described earlier, this increase was primarily driven by higher volume and product mix across several product lines, spices and seasonings, dry recipe mixes and frozen products. Pricing related to the incremental impact of 2018 actions also contributed to the increase. In EMEA, constant currency consumer sales were up 1% from a year ago.

Higher volume and product mix were driven by new products, distribution gains and promotional activities. This growth was partially offset by pricing actions, including those related to planned trade promotional activity for new products and the holiday season. We grew consumer sales in the Asia Pacific region 4% in constant currency, led by China growth, with strength in new World Flavor sauces and chicken bouillon as well as herbs and spices. Turning to our flavor solutions segment in Slide 17.

We grew first-quarter constant currency sales 6%, attributable to a strong growth in the EMEA and Americas regions. In the Americas, flavor solutions constant currency sales increased 7% with broad-based growth across the portfolio, driven by quick service restaurants and continued flavors momentum. New products, expanded distribution and our customers' promotional activities all contributed to the sales increase. In EMEA, we grew flavor solutions sales 9% in constant currency, driven by new products and volume growth on the base business.

Sales increased to both packaged food companies and quick service restaurants, partially due to their promotional activity and spend across all categories. In the Asia Pacific region, flavor solutions sales in constant currency were flat to the year-ago period due to the timing of our quick service restaurant customers' promotional activities. Across both segments, adjusted operating income, which excludes special charges, and for 2018 the transaction and integration cost related to the acquisition of our Frank's and French's brands, rose 4% in the first quarter versus the year-ago period. Excluding the impact of unfavorable currency, rose 6%.

Adjusted operating income in the consumer segment rose to $135 million. And in the flavor solutions segment, we rose to $64 million, both of which were a 4% increase. In constant currency, adjusted operating income increased 6% in the consumer segment and 7% in the flavor solutions segment. For each segment, the increase was driven by higher sales and CCI-led cost savings.

As seen on Slide 22, in the first quarter, we expanded adjusted operating margin 40 basis points. This expansion was driven by leverage from sales growth, CCI-led cost savings and lower brand marketing, partially offset by investments to drive future growth. Turning to income taxes on Slide 23. Our first-quarter adjusted effective income tax rate was 13.9% as compared to 18.9% in the year-ago period.

Our first-quarter adjusted rate was favorably impacted by discrete tax items, primarily one related to our entity structure as we mentioned in our January earnings call. We continue to project our full-year 2019 adjusted effective tax rate to approximate 22%. Income from unconsolidated operations was $10 million compared to $8 million in the first quarter of 2018 with the increase led by our joint venture in Mexico. For 2019, we continue to expect a low single-digit increase in our income from unconsolidated operations.

At the bottom line, as shown on Slide 25, first-quarter 2019 adjusted earnings per share was $1.12, up 12% from $1 for the year-ago period, mainly due to higher adjusted operating income and the lower adjusted income tax rate. And this increase included an unfavorable impact from currency. On Slide 26, we summarized highlights for cash flow and the quarter-end balance sheet. Our cash flow provided from operations was $104 million in the first quarter of 2019 compared to an outflow of $21 million in the first quarter of 2018.

This increase was driven by higher operating income and working capital improvements. As we execute against programs to achieve working capital reductions such as extending supplier payment terms and inventory management programs, we continue to see improvements in our cash conversion cycle, finishing the first quarter down four days versus our fiscal year-end. We returned $75 million of cash to shareholders through dividends and used $25 million for capital expenditures this period. We expect 2019 to be another year of strong cash flow driven by profit and working capital initiatives.

And our priority is to continue to have a balanced use of cash, making investments to drive growth, returning a significant portion to our shareholders through dividends and to pay down debt. Let's now move to our current financial outlook for 2019 on Slide 27. We are reaffirming our 2019 outlook for another year of strong performance with our broad and advantaged flavor portfolio, effective growth strategies and focus on profit realization. We continue to estimate, based on prevailing rates, a 2-percentage-point unfavorable impact from currency rates on net sales, adjusted operating income and adjusted earnings per share.

We expect unfavorable currency impact will be greater in the first half of the year than in the second half. At the top line, we reaffirm our guidance to grow sales 1% to 3%, which in constant currency is a 3% to 5% projected growth rate. As a reminder, this will be entirely organic growth-driven, primarily by higher volumes and product mix as well as the impact of pricing to offset any anticipated low single-digit cost increase. We continue to project our 2019 gross profit margin to be 25 to 75-basis-point higher than in 2018, in part driven by our CCI-led cost savings.

We reaffirm our adjusted operating income growth of 7% to 9% from $930 million in 2018, which in constant currency is a 9% to 11% projected growth rate and reflects our continued focus on profit realization. Our cost-savings target is approximately $110 million, and we expect brand marketing to be comparable to 2018. As I previously mentioned, we continue to expect our 2019 adjusted effective income tax rate to approximate 22% based upon our estimated mix of earnings by country, in addition to our state tax rates. This projection is lower than our underlying effective tax rate of 24% due to the favorable first-quarter discrete impact I mentioned a few moments ago.

Our full-year 22% outlook versus our 2018 adjusted effective tax rate of 19.6% is approximately a 300-basis-point headwind to our 2019 adjusted earnings-per-share growth. We reaffirm our guidance for the adjusted earnings per share in 2019 of $5.17 to $5.27. This compares to $4.97 of adjusted earnings per share in 2018 and represents a 4% to 6% increase, which in constant currency is a 6% to 8% increase. This increase includes the expected tax headwind I just mentioned.

In summary, we are projecting strong growth in our 2019 constant currency outlook for sales, adjusted operating profit and adjusted earnings per share following record double-digit performance across each objective in 2018. I'd like to now turn it back to Lawrence for some additional remarks before we move to your questions.

Lawrence Kurzius -- Chairman, President, and Chief Executive Officer

Thank you, Mike. Now that Mike has shared our financ

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There's a Whole New Way to Profit in the Red-Hot Marijuana Sector

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Greg Miller

It's hard to overstate the importance of the 2018 Farm Bill for the American cannabis business – and the folks who've had the foresight to follow along with our cannabis investing research.

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Greg Miller

About the Author

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Greg Miller started working on Wall Street in September, 1987, just a month before the "Black Monday" stock market crash.

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Has The Social Media Vote-Rigging Been Stopped? Brexit Will Be The Test

&l;p&g;&l;img class=&q;dam-image getty wp-image-1136507676 size-large&q; src=&q;https://specials-images.forbesimg.com/dam/imageserve/1136507676/960x0.jpg?fit=scale&q; alt=&q;&q; data-height=&q;957&q; data-width=&q;960&q;&g;

Once upon a time you could predict the outcome of events by looking at the markets. That all changed and it turned out that the reason markets and bookmakers stopped acting as good indicators on the voters mood was that elections were being &a;lsquo;fixed&a;rsquo; by social media meddling.

By targeting swing voters with &a;rsquo;fake news&a;rsquo; elections that would have gone one way went another and mainstream polls didn&a;rsquo;t pick this up because it was only the tiny focal point of these campaigns that made the difference, which was invisible to the mass.

These series of upsets are clear and one of them is likely to be the Brexit vote.

You might say these tactic are no different than other political advertising which too are laced with lies and manipulation and that is in a way true. However, there is something very sinister about stalking individuals by using their social media footprint and then feeding them lies that play on their fears to get them to vote a certain way.

Once the penny dropped that this was going on the scandal of it shocked anybody who cares to fear the likes of Cambridge Analytics rigging elections.

The question now is, has this been stopped?

We are about to find out with Brexit.

The stock market seems to think we are in for a soft or no Brexit result. The book makers see no likelihood of a Hard Brexit.

&l;img class=&q;size-full wp-image-59637&q; src=&q;http://blogs-images.forbes.com/investor/files/2019/03/ftsebrexit190319.jpg?width=960&q; alt=&q;The stock market doesn&s;t think we will have a Hard Brexit&q; data-height=&q;589&q; data-width=&q;900&q;&g; The stock market doesn&s;t think we will have a Hard Brexit

Here are the odds:

&l;/p&g;&l;div class=&q;table-wrapper&q;&g;&l;table&g;&l;tbody&g;&l;tr&g;&l;td width=&q;350&q;&g;Brexit second referendum&l;/td&g; &l;td width=&q;77&q;&g;5/2&l;/td&g; &l;/tr&g;&l;tr&g;&l;td width=&q;350&q;&g;Article 50 extension&l;/td&g; &l;td width=&q;77&q;&g;1/6 on&l;/td&g; &l;/tr&g;&l;tr&g;&l;td width=&q;350&q;&g;Hard Brexit&l;/td&g; &l;td width=&q;77&q;&g;5/1&l;/td&g; &l;/tr&g;&l;tr&g;&l;td width=&q;350&q;&g;Brexit date this year &a;ndash; even money&l;/td&g; &l;td width=&q;77&q;&g;50/50&l;/td&g; &l;/tr&g;&l;tr&g;&l;td width=&q;350&q;&g;Second UK referendum and votes to remain&l;/td&g; &l;td width=&q;77&q;&g;4/1&l;/td&g; &l;/tr&g;&l;/tbody&g;&l;/table&g;&l;/div&g;

So the market says soft Brexit and so do the bookies.

The punters say, Article 50 extension, Brexit this year, no Hard Brexit and no second referendum.

Personally, I&a;rsquo;d take the second referendum bet and the Hard Brexit bet if I was a gambling man. The odds are good even if it doesn&a;rsquo;t turn out that way. Luckily for me I am not a betting man.

So if you believe in markets as oracles and then the stock market indication and the bookmaker odds turn out totally wrong, again, then we might rest easy that the political data-miners are not the reason the last election&a;rsquo;s results were such a surprise to the markets and oddsmakers.

If these informal pollsters get it right this time, as they used to before the sinister phenomena of social media data and &a;lsquo;fake news&a;rsquo; raised its ugly head, it&a;rsquo;s another warning that social media manipulation of public opinion and voting is very real. When it comes to polls if there are forces at work manipulating the vote away from the wisdom of the crowd to the benefit of those with the best data and algos then we are in great peril.

Of all the dangers to our freedom and democracy the perils of the covert manipulation of the public vote is the paramount danger.

&a;nbsp;

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Insider Selling: Abbott Laboratories (ABT) Insider Sells 9,188 Shares of Stock

Abbott Laboratories (NYSE:ABT) insider Roger Bird sold 9,188 shares of the business’s stock in a transaction dated Wednesday, March 13th. The stock was sold at an average price of $79.06, for a total value of $726,403.28. Following the sale, the insider now owns 60,195 shares in the company, valued at $4,759,016.70. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink.

Shares of NYSE ABT traded up $0.36 during trading hours on Thursday, reaching $78.98. 5,382,111 shares of the stock traded hands, compared to its average volume of 6,356,053. The stock has a market cap of $137.43 billion, a price-to-earnings ratio of 27.42, a P/E/G ratio of 2.09 and a beta of 1.13. The company has a current ratio of 1.62, a quick ratio of 1.20 and a debt-to-equity ratio of 0.63. Abbott Laboratories has a 52-week low of $56.81 and a 52-week high of $79.14.

Get Abbott Laboratories alerts:

Abbott Laboratories (NYSE:ABT) last announced its quarterly earnings data on Wednesday, January 23rd. The healthcare product maker reported $0.81 earnings per share for the quarter, meeting the Zacks’ consensus estimate of $0.81. The company had revenue of $7.77 billion for the quarter, compared to analysts’ expectations of $7.82 billion. Abbott Laboratories had a return on equity of 16.55% and a net margin of 7.74%. Abbott Laboratories’s revenue for the quarter was up 2.3% compared to the same quarter last year. During the same period last year, the firm posted $0.74 EPS. On average, analysts forecast that Abbott Laboratories will post 3.2 EPS for the current fiscal year.

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, May 15th. Investors of record on Monday, April 15th will be issued a dividend of $0.32 per share. The ex-dividend date of this dividend is Friday, April 12th. This represents a $1.28 dividend on an annualized basis and a dividend yield of 1.62%. Abbott Laboratories’s dividend payout ratio is 44.44%.

Several hedge funds and other institutional investors have recently made changes to their positions in ABT. First Trust Advisors LP grew its position in shares of Abbott Laboratories by 30.2% in the 3rd quarter. First Trust Advisors LP now owns 56,019 shares of the healthcare product maker’s stock worth $4,110,000 after buying an additional 12,978 shares during the last quarter. Robeco Institutional Asset Management B.V. grew its position in shares of Abbott Laboratories by 49.8% in the 3rd quarter. Robeco Institutional Asset Management B.V. now owns 365,246 shares of the healthcare product maker’s stock worth $26,794,000 after buying an additional 121,364 shares during the last quarter. WINTON GROUP Ltd grew its position in shares of Abbott Laboratories by 58.5% in the 3rd quarter. WINTON GROUP Ltd now owns 9,540 shares of the healthcare product maker’s stock worth $700,000 after buying an additional 3,520 shares during the last quarter. Forbes J M & Co. LLP grew its position in shares of Abbott Laboratories by 1,508.3% in the 3rd quarter. Forbes J M & Co. LLP now owns 144,636 shares of the healthcare product maker’s stock worth $10,611,000 after buying an additional 135,643 shares during the last quarter. Finally, Virginia Retirement Systems ET AL grew its position in shares of Abbott Laboratories by 52.3% in the 3rd quarter. Virginia Retirement Systems ET AL now owns 283,200 shares of the healthcare product maker’s stock worth $20,776,000 after buying an additional 97,200 shares during the last quarter. 74.31% of the stock is currently owned by institutional investors.

ABT has been the topic of a number of research analyst reports. Wells Fargo & Co restated a “buy” rating on shares of Abbott Laboratories in a report on Thursday. Credit Suisse Group initiated coverage on Abbott Laboratories in a research report on Monday, December 17th. They issued an “outperform” rating and a $82.00 price target for the company. Argus increased their price target on Abbott Laboratories to $90.00 and gave the company an “in-line” rating in a research report on Friday, January 25th. They noted that the move was a valuation call. Barclays set a $84.00 price target on Abbott Laboratories and gave the stock a “buy” rating in a research note on Friday, March 8th. Finally, Morgan Stanley raised their target price on Abbott Laboratories from $80.00 to $82.00 and gave the stock an “overweight” rating in a research note on Tuesday, December 4th. One equities research analyst has rated the stock with a sell rating, four have given a hold rating and fourteen have given a buy rating to the company’s stock. Abbott Laboratories has a consensus rating of “Buy” and a consensus target price of $79.71.

ILLEGAL ACTIVITY WARNING: This article was first posted by Ticker Report and is the sole property of of Ticker Report. If you are reading this article on another domain, it was stolen and reposted in violation of US and international copyright & trademark law. The legal version of this article can be read at https://www.tickerreport.com/banking-finance/4221581/insider-selling-abbott-laboratories-abt-insider-sells-9188-shares-of-stock.html.

About Abbott Laboratories

Abbott Laboratories discovers, develops, manufactures, and sells health care products worldwide. The company's Established Pharmaceutical Products segment offers branded generic pharmaceuticals for the treatment of pancreatic exocrine insufficiency; irritable bowel syndrome or biliary spasm; intrahepatic cholestasis or depressive symptoms; gynecological disorders; hormone replacement therapy; dyslipidemia; hypertension; hypothyroidism; Ménière's disease and vestibular vertigo; pain, fever, and inflammation; migraines; and anti-infective clarithromycin, as well as provides influenza vaccine and products that regulate physiological rhythm of the colon.

Featured Story: Diversification in Investing

Why Aurora's Latest Strategy Smells Like Desperation

Aurora Cannabis (NYSE:ACB) recently made a silly attempt to convince investors they could look forward to adults making smart decisions in the boardroom, and it worked. Shares of Aurora finished Wednesday's session 13.9% higher because the company hired an activist investor to set up some meetings with large consumer-goods companies eager to make a deal. 

If you don't understand why this investor relations stunt isn't worth a press release, you need to read this now. 

What activist investors do

Activist investors generally run large funds that take large stakes in a company's stock in an attempt to wield influence over it. This is often a CEO's worst nightmare, but for everyday investors like us, it can be a dream come true.

How CEOs normally feel when an activist investor takes interest in their company. Image source: Getty Images.

For example, Jana Partners is an activist hedge fund that took up an 8% stake in Whole Foods in early 2017. That was enough to get the ball rolling and gather together shareholders who wanted the struggling grocer to put itself up for sale. Within a few months, Amazon.com swooped in with $13.7 billion in cash, which immediately raised Whole Foods' stock price 28% higher.

Whole Foods CEO John Mackey called Jana Partners "greedy bastards," but the struggling grocer's investors are probably better off.

Who hires an activist to act as an advisor? 

Generally, activists try to help shareholders by getting management to do something it doesn't want to do in the first place. Hiring one as an advisor is pointless.

That didn't stop enthusiastic investors from piling in after Aurora Cannabis told investors that Nelson Peltz, a well-known activist investor with a great deal of food distribution experience, is officially a part of Aurora's management team as a "senior strategic advisor." Although Peltz is the CEO of Trian Fund Management, his fund hasn't disclosed any investment stake in Aurora Cannabis.

If Trian Fund doesn't own a piece of the company, Aurora's managers don't have to take the advice they're paying Peltz to provide. Despite slim odds that this partnership will produce more than a press release, Aurora Cannabis' market cap rose by roughly $1 billion on the day of the announcement.

Image source: Getty Images.

Now you want advice?

Peltz and Aurora will work on finding partnerships and expanding the company's global footprint, but those boats sailed a long time ago. Between August 2016 and December 2018, Aurora Cannabis undertook 15 acquisitions and made investments into 12 others. Now that the company has already expanded operations to 24 separate countries at great expense, any more expanding before we have proof these markets are viable seems like a bad idea.  

If Peltz were given a board seat, he would most likely put an end to the dilutive acquisitions that have already made it impossible for long-term Aurora shareholders to realize a decent return. This company has been using its own shares to expand at all costs, which is a lot more expensive than most investors realize.

Aurora Cannabis stock has risen an exciting 396% over the past two years, but most investors have overlooked the number of new shares the company's created to keep everyone interested. Over the same time frame, the number of outstanding shares nearly tripled. To provide the return investors were hoping for, profits needed to rise three times higher than investors were expecting.

Strategy lessons from this guy?

Peltz is a well known activist investor, but not because he's been particularly successful lately. In 2015, his fund poured $2.5 billion into General Electric (NYSE:GE), and shares of the conglomerate have underperformed the S&P 500 by 86% since Trian Fund Management disclosed its stake.

Shortly after pulling the trigger on GE, the Trian Fund opened a position in Procter & Gamble (NYSE:PG) that's become its largest at $3.5 billion. A decade ago, P&G had a handful of competitors that could even dream of launching a new brand of men's razor. Now, the big consumer-goods companies are all scrambling to buy start-ups that are competing in ways that just weren't possible a very short time ago.  

Experienced cannabis consumers in Canada already know that Aurora's brands can't compete with their favorite mom-and-pop operations in terms of quality. Try to imagine a can of Budweiser versus a fresh pint of ale at the brewery it was born in. The big difference is that small-batch marijuana tends to be significantly less expensive.

Peltz is having a rough time with P&G's established brands, but that's nothing compared to the challenges ahead of Aurora. The company's attempt to build brands in heavily taxed markets, with competition from untaxed illicit markets breathing down its neck, is going to be an uphill slog.

Image source: Getty Images.

What Peltz could bring to the table

Nearly every week, at least one marijuana stock rises after the company announces an all-stock purchase decision that would send stocks from any other industry tumbling. The marijuana industry isn't going to stop partying like it's the internet in 1999, and Peltz isn't going to stop Aurora from using its shares the way my son uses Monopoly money.

Aurora's stunt smells like desperation, but paying Peltz to be an advisor does bring an air of partnership possibility to Aurora's image that someone might find appealing. Hoping another desperate company with failing brands makes a bad decision, though, isn't a very good investing strategy. 

Roku Shares Hit With 2 Downgrades

So far in 2019, shares of streaming TV platform Roku (NASDAQ:ROKU) have staged a massive comeback, gaining 131% year to date through yesterday's close. The stock is now nearly back to where it was before the broad market turmoil in the fourth quarter. To be clear, Roku has given investors a lot to be optimistic about in recent months. Core operating metrics like active accounts, hours streamed, and average revenue per user (ARPU) all continue to march into record territory, and Roku expects to hit $1 billion in revenue this year, a significant milestone for the company.

But the market could be getting ahead of itself.

Image source: Roku.

A tale of two downgrades

Roku was hit with two separate downgrades today, thanks to Loop Capital and Macquarie, with analysts at both firms pointing to stretched valuation at current levels.

Loop Capital dropped its rating on Roku shares from hold to sell, while keeping a $45 price target. Analyst Alan Gould argues that the stock has reached "excessive valuation" levels and believes Roku could suffer from intensifying competition on the horizon. The streaming wars are heating up, with a multitude of traditional telecom and media giants bringing over-the-top (OTT) services to market this year. That could help Roku's hardware business, even while putting competitive pressure on the platform segment.

Gould also notes that there has been an uptick in insider selling, which doesn't inspire a lot of confidence. For example, regulatory filings show CEO Anthony Wood converted and sold 35,000 shares earlier this month as part of a pre-arranged Rule 10b5-1 trading plan at prices between $66.81 and $69.82. Roku also filed a mixed shelf offering this week for an unspecified number of shares, suggesting some dilution is in store.

Separately, Macquarie downgraded its rating on Roku to neutral, similarly pointing to "a full valuation" at current levels. Beyond the upcoming onslaught of traditional companies jumping into the streaming space, Macquarie is also concerned about Apple's upcoming video-streaming service, which will be unveiled in less than two weeks. That service could garner 100 million subscribers within a few years of launch, according to estimates from Wedbush.

Macquarie is also concerned that Roku's ad business could get hurt, as the media giants are now collaborating on a new consortium led by TV manufacturer Vizio called Project OAR, which stands for "Open Addressable Ready." The goal is to create an open standardized advertising platform for the industry's ongoing shift to streaming, facilitating targeted ads akin to how online ad networks are able to target eyeballs with uncanny accuracy. That initiative was just announced this week and isn't expected to officially launch until next year, but it could eventually threaten to undermine Roku's proprietary ad platform and poach advertisers.

Roku's platform segment is largely driven by advertising, with revenue sharing of subscription and a-la-carte purchases representing a smaller portion of that business. Much of Roku's ARPU gains -- which are calculated as total platform revenue divided by active accounts on a trailing-12-month (TTM) basis -- are attributable to growth in advertising revenue. ARPU hit a record $17.95 in 2018.

Roku is facing many potential headwinds going forward, and intensifying competition combined with a lofty valuation is a recipe for a pullback.

Igloo recalls select coolers after boy locked…

Igloo Products Corp. is voluntarily recalling coolers from its Marine Elite line after reports that a Florida boy was trapped inside one.

According to WSVN, 5-year-old Nicholas Wanes climbed inside his family's 72-quart Marine Elite cooler on March 2. The Florida news station reports that he was in the cooler playing hide-and-seek with the lid open before it shut and he was locked in.

Nicholas' father, Robert Wanes of Pompano Beach, said in a Facebook post that his security camera caught the incident, which he posted on March 5.

"So we always see the good stuff and although this story ended well, hopefully there is something to be learned," Robert Wanes wrote in the post. "My son Nicholas got locked inside an igloo cooler. He was playing by himself and thought it was a good idea."

After the incident, Igloo issued a safety alert on its website announcing the voluntary recall that identifies eight models and item numbers, four of which the company says were sold at West Marine.

"It is possible that the stainless-steel latch could, inadvertently close where a person could potentially become locked inside," the safety alert states.

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Pasta recall: Chef Boyardee recalls beef ravioli bowls mislabeled as rice with chicken and veggies

Drug recall: 126 lots of popular blood pressure medication recalled for cancer risk

"We stand behind the quality of our products, and because your safety and satisfaction are our top priority, we wanted to let you know that we are voluntarily recalling the Igloo Marine Elite coolers," Igloo said in a statement on its website. "This recall concerns only those Igloo Marine Elite coolers with stainless-steel ability to lock latches."

The affected items are:

Igloo Marine Elite 72 quart; Item #00049375Igloo Marine Elite 54 quart; Item #00049374Igloo Marine Elite 94 quart; Item #00049574Igloo Marine Elite 110 quart; Item #00034108Igloo Marine Elite 72 quart; Item #00044476 (West Marine)Igloo Marine Elite 128 quart; Item #00044479 (West Marine)Igloo Marine Elite 94 quart; Item #00044478 (West Marine)Igloo Marine Elite 162 quart; Item #00044480 (West Marine)

The latch-replacement kits have been sent to some customers, but those who haven't received a kit can call Igloo at 866-509-3503. 

"We sincerely apologize for any inconvenience this issue may have caused you," Igloo said in the statement. "Our goal is to do everything we can to get you back out on the water using and loving your Igloo cooler."

Igloo did not immediately respond to USA TODAY's request for comment.

Follow Kelly Tyko on Twitter: @KellyTyko

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Bus ushers walk past red flags on Tiananmen Square during a plenary session of the Chinese People's Political Consultative Conference at the Great Hall of the People in Beijing. Ng Han Guan, APFullscreenMourners attend a memorial service in Addis Ababa, Ethiopia. Authorities in Ethiopia, China and Indonesia grounded all Boeing 737 Max 8 aircraft Monday following the crash of an Ethiopian Airlines jetliner that killed 157 people. Samuel Habtab, APFullscreenFormer Trump campaign foreign policy advisor George Papadopoulos and his wife Simona Mangiante walk through the Hart Senate Office Building in Washington, DC. Mangiante was scheduled to meet with the Senate Intelligence Committee. Mark Wilson, Getty ImagesFullscreenRevellers participate in a carnival procession in Basel, Switzerland. GEORGIOS KEFALAS, EPA-EFEFullscreenKashmiris flee their villages after one person was killed and three others were injured as Indian forces fired mortar shells from across the Line of Control, at the border between Pakistani and Kashmir. AMIRUDDIN MUGHAL, EPA-EFEFullscreenA boy picks up a burning wooden disc for the traditional 'Scheibenschlagen', in Plattis, Switzerland. In this tradition a glowing disc of wood, dedicated to a loved person, is hurled towards the valley and on the same day, the so-called "Funkensonntag", a big fire is lit to drive winter away. GIAN EHRENZELLER, EPA-EFEFullscreenHot air balloons are seen rising over Lake Burley-Griffin during the Canberra International Balloon festival in Canberra, Australia. The festival is considered one of the biggest hot air balloon festivals in the world. LUKAS COCH, EPA-EFEFullscreenA woman protects herself as she walks during an unexpected snowfall in Minsk, Belarus. Sergei Grits, APFullscreenPoeple fly kites on Filopappou hill overlooking the ancient Acropolis in Athens. "Clean Monday" marks the end of the carnival and the start of the 40-day fasting period of Lent, leading up to Orthodox Easter. LOUISA GOULIAMAKI, AFP/Getty ImagesFullscreenIndonesian Siti Aisyah waves after a press conference in Jakarta. Shock and delight rippled through the Indonesian town of Sindangsari as residents got word that a local woman accused of assassinating the North Korean leader's half-brother had been freed. ADEK BERRY, AFP/Getty ImagesFullscreenThis is the construction site with the world's tallest tower Burj Khalifa (background) in the Gulf emirate of Dubai. KARIM SAHIB, AFP/Getty ImagesFullscreenLee Spencer, a 49-year-old former British marine, known as 'The Rowing Marine', holds a red flare and his prosthesis as he arrives in Cayenne, French Guiana after smashing solo Atlantic rowing record from mainland Europe to South America. Spencer spent 60 days offshore to cross the Atlantic through 3,800 nautical miles, becoming the first physically disabled person to make the solo crossing. JODY AMIET, AFP/Getty ImagesFullscreenInterested in this topic? You may also want to view these photo galleries:Replay1 of 122 of 123 of 124 of 125 of 126 of 127 of 128 of 129 of 1210 of 1211 of 1212 of 12AutoplayShow ThumbnailsShow CaptionsLast SlideNext Slide

 

Top 10 Heal Care Stocks To Buy Right Now

tags:KONE,EGL,COL,IPHI,KMG,SEM,AMRN,NTP,VAL,IMKTA,

For our top pick in 2017, I used my guru-based screening application to look for stocks with high scores from at least two of my guru models, explains John Reese, editor of Validea.

I focused on fundamental strategies based on Buffett, Graham, Lynch, Zweig, Neff and a number of others and stocks with the lowest relative strength, meaning the stocks that have underperformed the most over the past 12 months.

Since this is an aggressive pick, we can look for a name that looks to be extremely oversold and being priced for a worst case scenario.

These are the types of stocks that Ben Graham called cigar butt stocks in the sense that you may be able to pick them up and take one last, but really good puff and get it for virtually free.

One of the stocks that meets this criteria is GNC Holdings (GNC), an $890 million specialty retailer of health, wellness and performance products.

Top 10 Heal Care Stocks To Buy Right Now: Kingtone Wirelessinfo Solution Holding Ltd(KONE)

Advisors' Opinion:

• [By Money Morning News Team]

  While a 209% gain is exciting, FunctionX's gains are in the past. After looking at the 10 top penny stocks to watch this week, we'll show you a small-cap stock with serious profit potential ahead of it…

  Penny Stock Current Share Price Law Week's Gain FunctionX Inc. (OTCMKTS: FNCX) $0.03 209% Turtle Beach Corp. (Nasdaq: HEAR) $4.48 52.73% DPW Holdings Inc. (NYSE: DPW) $1.16 51.31% Energy XXI Gulf Coast Inc. (Nasdaq: EGC) $5.62 49.33% MYnd Analytics Inc. (Nasdaq: MYND) $1.91 49.21% Kingtone Wirelessinfo Solutions Holding Ltd. (Nasdaq: KONE) $6.43 48.42% Rennova Health Inc. (OTCMKTS: RNVA) $0.02 44.30% International Tower Hill Mines Ltd. (NYSE: THM) $0.72 41.64% Blonder Tongue Labs Inc. (NYSE: BDR) $1.13 41.14% Bellicum Pharmaceuticals Inc. (Nasdaq: BLCM) $8.87 40.53%

  As the gains above suggest, penny stocks can provides tremendous returns for investors very quickly. However, it's important to note that investing in penny stocks is also inherently risky.

Top 10 Heal Care Stocks To Buy Right Now: Engility Holdings, Inc.(EGL)

Advisors' Opinion:

• [By Joseph Griffin]

  Get a free copy of the Zacks research report on Engility (EGL)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Daniel Sparks]

  The stock's decline followed SAIC's better-than-expected second-quarter results, as well as an announcement from SAIC that it's acquiring Engility Holdings (NYSE:EGL), a staffing and outsourcing services company. The acquisition, which is valued at $2.5 billion when including the assumption of Engility's $900 million in debt, is a significant undertaking given that SAIC's total market capitalization is only around $3.5 billion.

• [By Logan Wallace]

  Get a free copy of the Zacks research report on Engility (EGL)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Ethan Ryder]

  Get a free copy of the Zacks research report on Engility (EGL)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

Top 10 Heal Care Stocks To Buy Right Now: Rockwell Collins, Inc.(COL)

Advisors' Opinion:

• [By Stephan Byrd]

  Rockwell Collins, Inc. (NYSE:COL) saw some unusual options trading activity on Tuesday. Stock investors bought 1,159 call options on the stock. This represents an increase of 1,367% compared to the typical daily volume of 79 call options.

• [By Lee Samaha]

  Investors in United Technologies (NYSE:UTX) should prepare for some pretty big changes at the conglomerate. It's been a long time coming, but the company's acquisition of Rockwell Collins (NYSE:COL) should be completed by the end of September, and within a couple of months, management will publicly outline the results of its review of strategic options. They are widely expected to deliver a breakup plan. Here's the lowdown, and why splitting up the business makes sense.

• [By Lee Samaha]

  Meanwhile, UTAS reported yet another strong quarter of growth in commercial aftermarket, and with the forthcoming addition of Rockwell Collins (NYSE:COL), UTAS is well positioned to benefit from a buoyant commercial aerospace market.

• [By Ethan Ryder]

  Get a free copy of the Zacks research report on Rockwell Collins (COL)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Max Byerly]

  These are some of the media headlines that may have impacted Accern Sentiment Analysis’s rankings:

  Get Rockwell Collins alerts: Military Avionics Systems Market by leading Industry Players (Avidyne, GE Aviation, Honeywell, Rockwell Collins) and Growth Rate (2018-2025) (emailwire.com) Program aims to connect Maryland’s college students and international businesses (msn.com) Rockwell Collins (COL) Expected to Announce Earnings of $1.89 Per Share (americanbankingnews.com) KAI and Rockwell Collins team up for Korean Chinook upgrade (janes.com) German auto giant boosts bet on cutting-edge AR from Silicon Valley (finance.yahoo.com)

  Several research firms have commented on COL. Royal Bank of Canada reiterated a “hold” rating and issued a $143.00 price objective on shares of Rockwell Collins in a report on Friday, April 6th. Zacks Investment Research downgraded shares of Rockwell Collins from a “buy” rating to a “hold” rating in a research note on Thursday, February 22nd. Cowen restated a “hold” rating and issued a $135.00 price target on shares of Rockwell Collins in a research note on Friday, January 26th. Finally, Canaccord Genuity decreased their price target on shares of Rockwell Collins from $140.00 to $137.00 and set a “hold” rating on the stock in a research note on Tuesday, January 30th. Two equities research analysts have rated the stock with a sell rating, seventeen have assigned a hold rating, three have given a buy rating and one has given a strong buy rating to the company. The stock currently has a consensus rating of “Hold” and an average price target of $134.13.

Top 10 Heal Care Stocks To Buy Right Now: Inphi Corporation(IPHI)

Advisors' Opinion:

• [By ]

  There are some companies that have weak fundamentals and are regularly incurring losses but that are valued strongly by the market purely based on one metric: revenue growth. Inphi Corporation (NYSE:IPHI) is the perfect example of such a company that has enjoyed a very high valuation despite being a loss-making unit for a large period within the past five years. The company's revenue growth was phenomenal and the profits were expected soon. In fact, the company did end up with a good profit in 2016 when the EV/Sales multiple shot up above 7.

• [By Max Byerly]

  News coverage about Inphi (NYSE:IPHI) has trended somewhat positive this week, according to Accern Sentiment Analysis. The research group identifies negative and positive news coverage by analyzing more than twenty million blog and news sources in real time. Accern ranks coverage of companies on a scale of negative one to one, with scores nearest to one being the most favorable. Inphi earned a media sentiment score of 0.15 on Accern’s scale. Accern also assigned news coverage about the semiconductor company an impact score of 46.0564611984507 out of 100, meaning that recent news coverage is somewhat unlikely to have an effect on the company’s share price in the near term.

• [By Max Byerly]

  Get a free copy of the Zacks research report on Inphi (IPHI)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Ethan Ryder]

  Inphi Co. (NYSE:IPHI) VP Ron Torten sold 12,342 shares of Inphi stock in a transaction dated Monday, August 27th. The stock was sold at an average price of $35.00, for a total value of $431,970.00. Following the sale, the vice president now directly owns 64,386 shares of the company’s stock, valued at approximately $2,253,510. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink.

• [By Timothy Green]

  Shares of Inphi Corp. (NYSE:IPHI) dropped on Wednesday following a mixed first-quarter report and a subsequent analyst downgrade. The company's revenue declined sharply and came in just short of analyst expectations. The stock was down about 9.5% at 2:45 p.m. EDT.

• [By Paul Ausick]

  Inphi Corp. (NYSE: IPHI) fell about 8.6% Friday to post a new 52-week low of $32.36 after closing at $35.40 on Thursday. The 52-week high is $51.78. Volume of about 3 million was roughly five times the daily average of around 680,000 shares traded. The company had no specific news.

Top 10 Heal Care Stocks To Buy Right Now: KMG Chemicals, Inc.(KMG)

Advisors' Opinion:

• [By Joseph Griffin]

  Morgan Dempsey Capital Management LLC lowered its stake in KMG Chemicals, Inc. (NYSE:KMG) by 57.1% in the first quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission. The fund owned 15,424 shares of the specialty chemicals company’s stock after selling 20,490 shares during the period. Morgan Dempsey Capital Management LLC owned 0.10% of KMG Chemicals worth $925,000 at the end of the most recent quarter.

• [By Shane Hupp]

  Huntsman (NYSE: KMG) and KMG Chemicals (NYSE:KMG) are both basic materials companies, but which is the superior stock? We will compare the two companies based on the strength of their risk, earnings, dividends, institutional ownership, valuation, profitability and analyst recommendations.

• [By Motley Fool Staff]

  KMG Chemicals (NYSE:KMG) Q3 2018 Earnings Conference CallJun. 11, 2018 5:00 p.m. ET

  Contents: Prepared Remarks Questions and Answers Call Participants Prepared Remarks:

  Operator

Top 10 Heal Care Stocks To Buy Right Now: Select Medical Holdings Corporation(SEM)

Advisors' Opinion:

• [By Stephan Byrd]

  Strs Ohio boosted its position in Select Medical Holdings Co. (NYSE:SEM) by 5.1% during the second quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 67,500 shares of the health services provider’s stock after buying an additional 3,300 shares during the quarter. Strs Ohio owned 0.05% of Select Medical worth $1,225,000 at the end of the most recent quarter.

• [By ]

  Cramer was bearish on Oclaro (OCLR) , Stratasys (SSYS) , Washington Prime Group (WPG) and Select Medical Holdings (SEM) .

  No-Huddle Offense 

  In his "No-Huddle Offense" segment, Cramer proclaimed that it's a fallacy to think that a low price/earnings multiple always means a stock is too cheap. Sometimes, the earnings estimates are simply too high.

• [By Joseph Griffin]

  Get a free copy of the Zacks research report on Select Medical (SEM)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Max Byerly]

  Get a free copy of the Zacks research report on Select Medical (SEM)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Ethan Ryder]

  Highbridge Capital Management LLC acquired a new stake in shares of Select Medical Holdings Co. (NYSE:SEM) during the first quarter, according to its most recent Form 13F filing with the SEC. The fund acquired 166,839 shares of the health services provider’s stock, valued at approximately $2,878,000. Highbridge Capital Management LLC owned 0.12% of Select Medical at the end of the most recent quarter.

• [By Ethan Ryder]

  Select Medical Holdings Co. (NYSE:SEM) insider Scott A. Romberger sold 5,000 shares of Select Medical stock in a transaction dated Monday, June 11th. The shares were sold at an average price of $18.63, for a total transaction of $93,150.00. Following the completion of the transaction, the insider now directly owns 158,485 shares of the company’s stock, valued at $2,952,575.55. The transaction was disclosed in a legal filing with the SEC, which is accessible through the SEC website.

Top 10 Heal Care Stocks To Buy Right Now: Amarin Corporation PLC(AMRN)

Advisors' Opinion:

• [By Beth McKenna]

  Amarin (NASDAQ:AMRN) stock gained 28.6% in January, according to data from from S&P Global Market Intelligence. For context, the the S&P 500 returned 8% last month.

• [By Cory Renauer]

  None of these biotech stocks are tiny, but they're still small enough to produce the dramatic gains this industry is known for. Here's what you need to know about the catalysts heading their way.

  Company (Symbol) Market Cap Candidate Trial Amarin Corporation plc (NASDAQ:AMRN) $966 million Vascepa Reduce-IT Geron Corporation (NASDAQ:GERN) $1.1 billion Imetelstat IMbark  Omeros Corporation (NASDAQ:OMER) $1.3 billion OMS721 IgA

  Data source: Yahoo! Finance, company filings.

• [By Dan Caplinger]

  The stock market came into the new week on a negative note, with the Dow Jones Industrial Average seeing the biggest declines among the major benchmarks. Renewed trade fears and political concerns out of Washington seemed to worry investors, and some trepidation about the speed with which interest rates have risen in recent days also weighed on some portions of the market. Yet some individual companies had good news that sent their shares higher despite the downbeat mood generally. Barrick Gold (NYSE:ABX), Amarin (NASDAQ:AMRN), and California Resources (NYSE:CRC) were among the best performers on the day. Here's why they did so well.

• [By Stephan Byrd]

  Amarin Co. plc (NASDAQ:AMRN)’s share price gapped up prior to trading on Tuesday . The stock had previously closed at $3.05, but opened at $3.16. Amarin shares last traded at $3.29, with a volume of 6172422 shares changing hands.

Top 10 Heal Care Stocks To Buy Right Now: Nam Tai Property Inc.(NTP)

Advisors' Opinion:

• [By Ethan Ryder]

  News coverage about Nam Tai Property (NYSE:NTP) has trended somewhat positive recently, according to Accern. Accern rates the sentiment of media coverage by reviewing more than 20 million news and blog sources in real-time. Accern ranks coverage of companies on a scale of -1 to 1, with scores closest to one being the most favorable. Nam Tai Property earned a news impact score of 0.20 on Accern’s scale. Accern also gave news coverage about the electronics maker an impact score of 47.3059674665332 out of 100, indicating that recent media coverage is somewhat unlikely to have an effect on the company’s share price in the next few days.

Top 10 Heal Care Stocks To Buy Right Now: Valspar Corporation (VAL)

Advisors' Opinion:

• [By Shane Hupp]

  Shares of ValiRx Plc (LON:VAL) rose 5.6% during mid-day trading on Thursday . The company traded as high as GBX 1.90 ($0.02) and last traded at GBX 1.90 ($0.02). Approximately 587,748 shares were traded during trading, a decline of 85% from the average daily volume of 3,820,000 shares. The stock had previously closed at GBX 1.80 ($0.02).

• [By Max Byerly]

  Valorbit (CURRENCY:VAL) traded 0% higher against the dollar during the 1 day period ending at 11:00 AM Eastern on June 9th. One Valorbit coin can currently be bought for approximately $0.0001 or 0.00000001 BTC on exchanges. Valorbit has a market cap of $537,598.00 and $0.00 worth of Valorbit was traded on exchanges in the last 24 hours. In the last seven days, Valorbit has traded up 5.8% against the dollar.

• [By Stephan Byrd]

  Valorbit (CURRENCY:VAL) traded up 0% against the U.S. dollar during the 1 day period ending at 0:00 AM E.T. on June 18th. One Valorbit coin can now be bought for approximately $0.0001 or 0.00000001 BTC on popular exchanges. Valorbit has a total market capitalization of $537,598.00 and $0.00 worth of Valorbit was traded on exchanges in the last day. During the last week, Valorbit has traded 5.8% higher against the U.S. dollar.

Top 10 Heal Care Stocks To Buy Right Now: Ingles Markets Incorporated(IMKTA)

Advisors' Opinion:

• [By Shane Hupp]

  Get a free copy of the Zacks research report on Ingles Markets (IMKTA)

  For more information about research offerings from Zacks Investment Research, visit Zacks.com

• [By Joseph Griffin]

  BidaskClub lowered shares of Ingles Markets (NASDAQ:IMKTA) from a buy rating to a hold rating in a research report report published on Tuesday.

  IMKTA has been the topic of several other reports. Zacks Investment Research cut shares of Ingles Markets from a hold rating to a sell rating in a research note on Wednesday, August 15th. ValuEngine raised shares of Ingles Markets from a strong sell rating to a sell rating in a research note on Tuesday, July 31st.

• [By Stephan Byrd]

  News articles about Ingles Markets (NASDAQ:IMKTA) have been trending somewhat positive recently, Accern Sentiment reports. Accern identifies negative and positive news coverage by monitoring more than twenty million news and blog sources in real-time. Accern ranks coverage of publicly-traded companies on a scale of -1 to 1, with scores closest to one being the most favorable. Ingles Markets earned a news impact score of 0.20 on Accern’s scale. Accern also assigned media headlines about the company an impact score of 46.3498595843486 out of 100, indicating that recent news coverage is somewhat unlikely to have an impact on the company’s share price in the next few days.

• [By Ethan Ryder]

  Ingles Markets, Incorporated (NASDAQ:IMKTA) declared a quarterly dividend on Tuesday, July 3rd, Wall Street Journal reports. Investors of record on Thursday, July 12th will be given a dividend of 0.165 per share on Thursday, July 19th. This represents a $0.66 dividend on an annualized basis and a dividend yield of 2.04%. The ex-dividend date of this dividend is Wednesday, July 11th.

Controladora Vuela Co Avcn SA CV (VLRS) Lifted to Buy at Goldman Sachs Group

Goldman Sachs Group upgraded shares of Controladora Vuela Co Avcn SA CV (NYSE:VLRS) from a sell rating to a buy rating in a report issued on Tuesday, Marketbeat Ratings reports.

Several other research firms have also recently weighed in on VLRS. Deutsche Bank upgraded shares of Controladora Vuela Co Avcn SA CV from a hold rating to a buy rating in a report on Monday, February 25th. Imperial Capital upgraded shares of Controladora Vuela Co Avcn SA CV from an underperform rating to an outperform rating and lifted their price target for the company from $4.50 to $11.50 in a report on Tuesday, February 26th. ValuEngine cut shares of Controladora Vuela Co Avcn SA CV from a buy rating to a hold rating in a report on Friday, March 1st. Zacks Investment Research upgraded shares of Controladora Vuela Co Avcn SA CV from a strong sell rating to a hold rating in a report on Saturday, January 19th. Finally, UBS Group upgraded shares of Controladora Vuela Co Avcn SA CV from a sell rating to a neutral rating in a report on Thursday, January 17th. Four research analysts have rated the stock with a hold rating and seven have assigned a buy rating to the stock. The company currently has an average rating of Buy and an average target price of $8.54.

Get Controladora Vuela Co Avcn SA CV alerts:

NYSE:VLRS opened at $8.78 on Tuesday. The firm has a market capitalization of $858.07 million, a P/E ratio of -25.09 and a beta of 1.03. Controladora Vuela Co Avcn SA CV has a twelve month low of $4.87 and a twelve month high of $9.11.

Institutional investors and hedge funds have recently bought and sold shares of the company. Zacks Investment Management purchased a new position in shares of Controladora Vuela Co Avcn SA CV in the 4th quarter worth about $62,000. Stevens Capital Management LP purchased a new position in shares of Controladora Vuela Co Avcn SA CV in the 4th quarter worth about $73,000. Virtu Financial LLC purchased a new position in shares of Controladora Vuela Co Avcn SA CV in the 4th quarter worth about $139,000. First Mercantile Trust Co. purchased a new position in shares of Controladora Vuela Co Avcn SA CV in the 4th quarter worth about $323,000. Finally, Pendal Group Ltd purchased a new position in shares of Controladora Vuela Co Avcn SA CV in the 3rd quarter worth about $723,000.

Controladora Vuela Co Avcn SA CV Company Profile

Controladora Vuela Compañía de Aviación, SAB. de C.V. provides air transportation services for passengers, cargo, and mail in Mexico and internationally. As of December 31, 2017, the company operated a fleet of 71 Airbus narrow-body aircraft, which include 12 Airbus A319s, 44 A320s, and 10 A321s. It operates approximately 319 daily flight segments on routes that connect 40 cities in Mexico and 27 cities in the United States and Central America.

Further Reading: Hedge Funds

Is DexCom a Buy?

DexCom (NASDAQ:DXCM) has been a home run stock for early investors. Its shares have thrashed the S&P 500 over the last one, three, and five years, showing no signs of slowing.

Can this winner keep thriving? Let's dig into the bull and bear cases for the California-based company to find out.

The business

DexCom, a medical device company focused on diabetes, sells a popular continuous glucose monitor (CGM) system called the DexCom G6. This device is worn on the body and constantly monitors a patient's blood glucose levels. That data is uploaded to a handheld controller, smartphone, or smartwatch that provides information needed to keep blood glucose levels in a healthy range.

Image source: DexCom.

DexCom operates on a razor-and-blade business model. The permanent "razor" is the company's handheld device that receives and displays the data, while the disposable "blades" are its sensors that are inserted directly into a patient's body. After 10 days of use, they need to be properly tossed and replaced, thus providing a dependable source of recurring revenue.

This business model has allowed DexCom's top line to grow at a breakneck pace as it brings on new patients over time.

DXCM revenue (TTM). Data by YCharts.

Reasons for optimism

DexCom's revenue growth has been incredibly impressive, and it remains strong to this day. In 2018, its top line rose by 44%, sending it over the $1 billion mark.

Can the company keep its double-digit growth rate going? The odds look good for a number of reasons:

Dexcom has captured less than 20% of the 3.2 million patients in the U.S. who require intensive insulin therapy. The penetration rate looks even smaller when you factor in the international opportunity.  According to the company, several other groups of patients could benefit from CGM therapy. This includes people with gestational diabetes, those who require non-intensive insulin therapy, and intermittent CGM use in the hospital setting. Together, these opportunities add up to tens of millions of potential users in the U.S. alone.  Dexcom has struck up numerous partnerships with other diabetes companies like Tandem Diabetes Care, Insulet, Eli Lilly, and Novo Nordisk to help get the word out.  The company has teamed up with Alphabet's healthcare division, Verily, to develop a next-generation sensor, which aims to be smaller, cheaper, and fully disposable. 

Management forecasts that the company will pull in between $2 billion and $2.5 billion in total revenue by 2023 and improve profitability significantly. If those numbers prove to be anywhere close to accurate, shareholders should be nicely rewarded.

Reasons for caution

Dexcom would be a no-brainer investment if the company had the CGM market all to itself. Unfortunately, it faces a fair amount of competition. 

Its primary competitor is medical device giant Medtronic (NYSE:MDT), which has enjoyed a strong foothold in the diabetes market for decades, through its insulin pump division. It also launched a combination insulin pump/CGM system a few years ago, a device thath increased patient convenience and has proven quite popular with patients.

Another heavy hitter in the CGM space is Abbott Labs (NYSE:ABT), which won FDA approval for a CGM device called the Freestyle Libre in 2017. The Libre was the first CGM system that did not require its users to perform daily finger sticks for calibration, and was also marketed at a much lower price point than DexCom's CGM. The Freestyle Libre has experienced a lot of market success. 

Thus far, DexCom hasn't had any problems growing even with the competition from these well-funded giants, but it's possible that could change.

Another potential pitfall that could work against investors who buy today is Dexcom's generous valuation. The company is currently trading for more than 12 times sales and about 150 times next year's earnings estimates. Those figures suggest that Wall Street is pricing in a lot of growth. If it fails to deliver on its ambitious growth targets, shareholders could be in a for a world of hurt.

Is DexCom a buy?

While DexCom isn't an appropriate stock for risk-averse investors, I still think there is a lot like about the company. Its product is innovative, and the company has secured numerous partnership agreements, which should ensure it continues to win more than its fair share of the new business. What's more, the diabetes market is so huge that it could easily support multiple winners.

If you're a growth-focused investor who doesn't mind paying up for a high-growth business, DexCom could be a nice addition to your portfolio.