Category: Stock Market

More investors watching stocks this summer may decrease volatility, top strategist tells Yahoo Finance

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The rally we’re experiencing in the stock markets has become something of a sensation. While equities generally are down some 15% from their all-time high levels, reached back in February, the rebound has been substantial. The S&P 500 is almost 33% from its March 23 trough.The big factor, of course, is the coronavirus crisis and the COVID-19 pandemic. The virus has – justifiably – taken the lion’s share of the news broadcasts. But that intense focus on one item has left investors with an incomplete picture. BMO Chief Investment Strategist Brian Belski has issued a report to correct this, by broadening the picture to point out other factors that are impacting markets and investor sentiment."While the COVID-19 virus is obviously still the big concern out there in the market, several others have also been recently brought up in our client interactions, including high market cap concentration atop the S&P 500, a surge in negative dividend actions by companies, and several sector weights approaching lows […] While we do believe these data trends should certainly continue to be monitored in the coming months, our analysis suggests that they may not be the roadblocks to US stock market performance moving forward that many investors appear to be expecting," Belski wrote.Belski says that the dividend stocks on the S&P 500 are still strong, and have not yet deteriorated as far as they did in the 2009 financial crisis. With the real possibility that an economic recovery may start in 2H20 – several states, including powerhouses like Texas and Florida, are moving to reopen now – this makes dividend stocks a valuable insurance policy for investors.With this in mind, we’ve used TipRanks database to pull up the details on three high-yield dividend stocks recommended by BMO analysts, in line with Belski’s report. Citizens Financial Group (CFG)We’ll start with Citizens Financial, one of the top retail banking companies in the US. Citizens offers an array of deposit, insurance, investment, and loan services in the commercial and retail segments.The company’s earnings, which had been solid in the $0.95 to $1.00 range for much of 2018 and 2019, slipped to just 9 cents per share in Q1 2020, and have a similar outlook for Q2. Through all of this, CFG has kept up its dividend. In fact, the company has raised the payment 5 times in the past three years. The current payment, at 39 cents per share quarterly, annualizes to $1.56 and gives a 7.2% yield. This compares highly favorably to the 2.16% average yield found among peers in the financial sector.The overall outlook is not perceived as grim – at least, not yet. The bank showed increased income from fees, clear gains in both mortgage and trust banking, and improvement in deposit balances. While low rates are bad for the loan business, CFG also showed an uptick in loan balances that bodes well. CFG has set up a small-business grant program, which is likely to both help the business sector most harmed by the COVID-19 epidemic and drum up longer-term business for the bank. In addition, the company has shored up its liquidity position through an issue of $1.5 billion in senior notes.Looking at the whole picture, BMO’s 5-star analyst Lana Chan says, “We believe that its capital and liquidity position appears sufficient to weather the COVID-19 related economic downturn.” In a more detailed outlook, she writes, “NII +low-mid single digits as strong loan growth more than offsets sizeable decrease in NIM, noninterest income down low-mid SDs, noninterest expense up slightly, LLP will depend on depth of recession and pace of recovery, significant loan growth reflecting commercial line draws, government programs, and increased demand in education.”Chan puts a $28 price target on CFG, backing her Buy rating. This target implies an upside for the stock of 31% in the coming year. (To watch Chan’s track record, click here)All in all, the analyst consensus view on Citizen’s Financial is a Strong Buy, based on 12 reviews that include 11 Buy and only a single Hold. Shares are deeply discounted and trading at $21.45, while the $28.50 average price target suggests an upside of 33%. (See Citizen Financial stock analysis at TipRanks)Ares Capital Corporation (ARCC)Next up is Ares Capital, an asset management company. Ares is well known for strong dividends, even in a business niche that usually pays out high yields. The company is currently paying out $1.60 annually, or 40 cents quarterly, making its dividend yield a robust 11.2%. Ares also has a history of adjusting its dividend payment to keep it in line with earnings, and sustainable.The company’s earnings, which took a hard hit from the coronavirus-inspired shutdowns, had already been trending down for three quarters – but remained in positive territory in Q1. EPS came in at 41 cents, missing the forecast by 4.6%. However, investors were heartened by the company’s lower reported expenses and positive activity in its portfolio. Ares also had taken successful efforts to shore up its liquidity position and overall balance sheet. These were seen as outweighing the generally expected drop in earnings.BMO’s Lana Chan was impressed by the company’s cash position. She noted, “ARCC currently has ~$460 million in cash and $2.1 billion in undrawn credit commitments. This gives it flexibility to support existing borrowers (with tighter loan documentation) and dry powder to take advantage of mis-priced opportunities (including select credit investments, large portfolios, or M&A). This extra liquidity and capital strength has the power to be a differentiating factor among BDCs…”While keeping her Buy rating on this stock, Chan lowered her price target to $16 – but this still indicates confidence in an 12% upside potential. (To watch Chan’s track record, click here)Ares Capital has a unanimous Strong Buy analyst consensus rating, based on no fewer than 14 Buy reviews. The stock’s price is trading at $14.36, and the average price target implies a modest upside of 6.4%. (See Ares Capital stock analysis at TipRanks)WP Carey & Company (WPC)You can’t talk about dividend stocks without at least mentioning one real estate investment trust. REITs are known high-performers among dividend plays, and WP Carey, with a market cap exceeding $10 billion, is one of the larger companies in the niche. The company specializes in commercial real estate, leasing properties long-term to clients in the US, and Northern and Western Europe.While most companies saw a steep earnings hit in Q1, due to this year’s pandemic, WPC managed to avoid that. The long-term nature of the company’s leases provided insulation, and Q1 FFO (funds from operations) came in at $1.25, beating the forecast by 5%, and broadly in-line with the previous five quarters’ income reports.WPC is currently paying out $1.04 per share in quarterly dividends, which annualizes to $4.16 and produces a strong yield of 7%. Like the stocks above, this dividend is sharp – and favorable – contrast to the average yields found among peer companies. WPC has a history of reliable payments, and has grown the dividend gradually over the past 6 years. The payout ratio is 83%, comparable to other REITs, and indicating that the payments are affordable at current income levels.WPC impressed BMO’s Jeremy Metz, and the analyst set a $70 price target, suggesting a 13% upside, to back his Buy rating. (To watch Metz’s track record, click here)In his comments, Metz wrote, “Our bull case on WPC in the current environment has been its revenue composition with limited relative exposure to retail, and at risk retail in particular (~2%)… the balance sheet/ liquidity remains in good shape.”Wall Street is both bullish and cautious on this stock. The Moderate Buy consensus rating is based on 2 Buy and 1 Hold set in recent months, while the $62 average price target projects a minimal upside – less than 1%. The share price has been mostly range-bound since early April, suggesting that it has found resistance at the average price target level. (See WPC stock analysis at TipRanks)To find good ideas for dividend stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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Ottawa-based Shopify, which briefly became Canada’s most valuable company earlier this month, had more than 5,000 employees and contractors worldwide as of December. “As of today, Shopify is a digital by default,” Tobi Lutke, who is also the founder of Shopify, said in a tweet. “Office centricity is over.”

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Pharmaceutical company AstraZeneca secures $1.2 billon to produce the University of Oxford’s COVID-19 vaccine. Yahoo Finance’s Anjalee Khemlani breaks down the latest developments.

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Is it May 2020 or March 2009? As Wall Street observers traverse the confused economic environment, flashbacks of the Great Recession are coming to mind. Those looking at the glass half empty will point out the bear market that emerged took 18 months to reach the lowest point. However, the optimists are singing a different tune.Among the bulls is Morgan Stanley’s head of U.S. equity strategy, Michael Wilson. In a recent note to clients, he argues that the current state of the market bears a striking resemblance to March 2009, the period in which the U.S. economy began to recover, with the S&P 500 embarking on what would become the longest bull-market run on record.“Markets are tracking the Great Financial Crisis period very closely in many ways,” Wilson wrote. To support this claim, the strategist highlights the fact that stocks are bouncing back in a “similar pattern," at the same time the amount of stocks, especially cyclicals, that have exceeded their 200-day moving average is on the rise. This is important as cyclicals usually lead the charge when a market recovery kicks off. Wilson also notes that the equity-risk premium, or the expected earnings yield for the S&P 500 minus the ten-year Treasury yield, looks the same as it did in March 2009, which played into his decision to call a stock-market bottom on March 16 of this year.Taking Wilson’s views into consideration, risk-tolerant investors are on the hunt for promising names now trading at lower levels, specifically within the biotech space. As it just takes one positive catalyst like strong data or a favorable FDA ruling to send shares skyrocketing, massive returns are on the table. That being said, as the opposite also holds true, these stocks come with their fair share of risk.Acknowledging the risk involved, we used TipRanks’ database to pinpoint compelling, yet affordable biotech stocks. We found three trading for under $5 that have not only received enough bullish recommendations from analysts to earn a “Strong Buy” consensus rating, but also sport colossal upside potential.Gamida Cell Ltd. (GMDA)It has certainly been a rough week for Gamida Cell, which develops therapies that could potentially cure blood cancers and other blood diseases.On Tuesday, the company unveiled the pricing for its underwritten public offering of 13,333,334 ordinary shares, which landed at $4.50 per share. The fund raise sent shares tumbling, with GMDA walking away from the day’s trading session down 26%. However, the new share price, $4.42, offers an attractive entry point, according to the analyst community.Weighing in for Oppenheimer, five-star analyst Mark Breidenbach cites recently released positive top-line data from its randomized Phase 3 trial of omidubicel in patients receiving bone marrow transplants as a key component of his bullish thesis. The trial had 125 participants between the ages of 12-65 with high-risk hematologic malignances (AML, CML, MDS, lymphoma), and GMDA’s candidate was studied against standard umbilical cord blood (UCB) grafts.Not only did omidubicel meet its primary endpoint, but the asset’s failure rate came in at 4% while the UCBs had a failure rate of 12%. After the readout, the company announced that it plans on initiating a rolling BLA submission in the fourth quarter.Expounding on the implications of the results, Breidenbach stated, “While expecting to see full results are at a medical meeting later this year (likely ASH), we believe these data could support a 2021 FDA approval and help spur uptake at transplant centers.” He added, “We believe omidubicel has been de-risked with the successful Phase 3 results.”Adding to the good news, Breidenbach argues that the results show omidubicel is “competitive with more widely used grafts, including matched unrelated donor (MUD) and mismatched-related donor grafts.” He noted, “As such, these data may support wider adoption of omidubicel among transplant physicans, although longer follow-up will be required to assess relapse rates and treatment-related mortality.”Based on all of the above, Breidenbach keep an Outperform (i.e. Buy) rating on the stock. Along with his bullish call, he also bumped up the price target from $18 to $20. This implies upside potential of a massive 352%. (To watch Breidenbach’s track record, click here) Turning now to the rest of the Street, other analysts are on the same page. Only Buy ratings have been received in the last three months, 3, in fact, so the consensus rating is a Strong Buy. In addition, the $18 average price target puts the upside potential at 307%. (See Gamida Cell stock analysis on TipRanks)VBI Vaccines (VBIV)Using its enveloped virus-like particle (eVLP) platform, VBI Vaccines develops vaccines that could be capable of addressing unmet needs in infectious disease and immuno-oncology. With one analyst, Canaccord Genuity’s John Newman, expecting a “catalyst-rich” second half of the year for the company, its $2.49 share price could mean that now is the time to pull the trigger.The five-star analyst tells investors the fourth quarter of 2020 will see VBIV submit regulatory approval filings for Sci-B-Vac, its vaccine against hepatitis B. These will be comprised of data from the CONSTANT and PROTECT Phase 3 trials in the U.S., Europe and Canada. “We continue to expect the agencies will view Sci-B-Vac's regulatory applications favorably and expect approvals in 2021…We continue to believe a key factor for VBIV will be whether the Advisory Committee on Immunization Practices (ACIP) recommends Sci-B-Vac at a two-dose immunization schedule, for their commercial launch,” he commented.As for its chronic hepatitis B virus (HBV) therapy, VBI-2601, initial human proof-of-concept data from the Phase 1b/2a study could be published in the second half of this year as well.Looking at its VBI-1901 asset, which was designed for use in recurrent Glioblastoma Multiforme (rGBM) patients, expanded immunologic, tumor and clinical data from the GM-CSF arm and initial immunologic and tumor response data from the AS01B arm are slated for release mid-year and in Q4, respectively. “We look for continued positive data for VBI-1901 in GBM,” Newman said.If that wasn’t enough, a pan-coronavirus vaccine is in the works, with VBIV expecting IND-enabling animal testing for the candidate, VBI-2901, to start in the second quarter. On top of this, the company could have clinical candidates selected and enough clinical supply ready in Q4 2020.As VBIV’s operations through 2021 will most likely be supported by the $57.5 million equity raise last month and its $35.8 million in cash as of Q1 2020, it’s no wonder Newman is optimistic. In addition to maintaining a Buy recommendation, he did trim the price target by $1 to account for share dilution. That being said, the $3 figure still leaves room for a possible twelve-month gain of 20%. (To watch Newman’s track record, click here)Do other analysts agree with Newman? As it turns out, they do. With 100% Street support, or 3 Buy ratings to be exact, the consensus is unanimous: VBIV is a Strong Buy. At $4.33, the average price target is more aggressive and suggests 74% upside potential. (See VBI Vaccines stock analysis on TipRanks)Cyclacel Pharmaceuticals (CYCC)The last biotech on our list, Cyclacel Pharmaceuticals, uses cell cycle, transcriptional regulation and DNA damage response biology to develop cancer therapies. Currently going for $4.59 apiece, some members of the Street are telling investors to get onboard before shares take off on an upward trajectory.Writing for Roth Capital, analyst Jonathan Aschoff believes the strength of CYCC’s development program makes it a stand-out. The company is focused on solid tumors, with it conducting its clinical trials so that it can still report updated fadraciclib Phase 1 data with the higher frequency IV dosing schedule in advanced solid tumors, initial Phase 1 safety and PK results with oral fadraciclib as well as kick off its Phase 1/2 precision medicine trial in early 2021. It should be noted that oral fadraciclib has already demonstrated concordance with IV pharmacokinetics based on early clinical data.With this strong technology, Aschoff argues that CYCC is targeting the unmet need in the cyclin E overexpressing tumors of the breast, endometrium/uterus and ovaries space. “The solid tumor program is key to our CYCC valuation, as projected revenue from this cyclin E overexpressing population represents more than 70% of projected revenue. We note that cyclin E is overexpressed in one-third of HR+ breast cancer patients resistant to first-line therapy, where patients could receive fadraciclib alone or potentially in combination with hormonal therapy. This population, combined with resistant second-line ovarian and endometrial/uterine cancer patients with high cyclin E amount to just over 100,000 patients in the U.S.,” he explained.Additionally, CYCC is set to publish initial Phase 1 fadraciclib/ venetoclax results in rel/ref AML/MDS and CLL, initial Phase 1 sapacitabine/venetoclax results in rel/ref AML/MDS and initial Phase 1 CYC140 data in advanced leukemias. While Phase 1b/2 sapacitabine/olaparib results in BRCA mutant metastatic breast cancer are also expected, the timing is uncertain.Some investors have expressed concern regarding COVID-19's impact on the company’s trials, but Aschoff points out that thus far, CYCC hasn’t experienced any enrollment delays. He added, “CYCC recently announced its intent to study the potential of fadraciclib to be an early inhibitor of the detrimental inflammatory response observed in COVID-19 patients, specifically to induce MCL1 downregulation and apoptosis of inflammatory neutrophils.”Consider all of this combined with its $27.3 million cash position that will support its development programs through 2022, and it makes sense why Aschoff remains squarely in the bull camp. To this end, he reiterated a Buy rating and $24 price target, indicating 423% upside potential. (To watch Aschoff’s track record, click here)Like Aschoff, other analysts also take a bullish approach. CYCC’s Strong Buy consensus rating breaks down into 3 Buys and zero Holds or Sells. Given the $16.33 average price target, shares could soar 256% in the next year. (See Cyclacel stock analysis on TipRanks)To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

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Chinese tech stock Baidu (BIDU) may delist from Nasdaq and transfer to an exchange closer to China, such as Hong Kong, Reuters reports. According to three Reuters sources, Baidu would use the move to boost its valuation as tension continues to escalate between the US and China over investments.“For a good company, there are many choices of destinations for listing, not limited to the U.S.,” CEO Robin Li recently told the China Daily newspaper.On May 20, the Senate passed legislation forcing US-listed companies to confirm that “they are not owned or controlled by a foreign government.”Shares in Baidu are currently trading down 14% on a year-to-date basis, and 43% on a three-year basis.“We believe the shares are undervalued, as we estimate core EBITDA growing 23% in FY21. Target assumes 7x ’21E core EBITDA vs. our 10x target multiple for Google core search” pointed out Oppenheimer analyst Jason Helfstein, as he reiterated his buy rating with a $155 price target (43% upside potential).Indeed Baidu scores a bullish Strong Buy consensus from the Street, with an average analyst price target of $147 (35% upside potential). (See BIDU stock analysis on TipRanks).The ‘Google of China’, as Baidu is sometimes known, has just reported solid first quarter earnings, with Q1 Non-GAAP EPS of $1.25 beating consensus expectations by $0.69. Revenue of $3.18B dropped 7% from a year ago, but easily beat the $3.1 billion consensus.Following earnings KeyBanc analyst Hans Chung ramped up his price target from $136 to $145. “Though ad demand for offline related business has not fully recovered from the COVID-19 pandemic, recovery is tracking ahead of expectations” he said.Related News: President Trump Takes Aim at Digital Tech Giants From Google to Twitter Amazon Urges Congress to Establish a Law Against Price Gouging iQIYI Sinks 4% As Online Ad-Revenue Falls Sharply More recent articles from Smarter Analyst: * 3 Biotech Stocks Under $5 With Massive Upside Potential * Amazon Rolls Out First Solar Energy Facility In China * Akorn Plummets 27% In Pre-Market On Bankruptcy Filing * AstraZeneca Can Make Up To 1B Covid-19 Vaccine Doses, Signs First Supply Pacts

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Yahoo Finance’s Alexis Christoforous, Brian Sozzi, and Anjalee Khemlani discuss the latest coronavirus news.

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Today we'll take a closer look at Intel Corporation (NASDAQ:INTC) from a dividend investor's perspective. Owning a…

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