Given the stock market’s propensity to humiliate those who dare predict its course, it is especially ironic that 2013’s dazzling returns come in the same year the Nobel Prize was conferred on economists whose work forecasted quite opposite results.
That is the message of Research Affiliates’ chief investment officer, Jason Hsu, in the investment research firm’s December “Fundamentals” newsletter, which notes that 2013’s near 30% stock market returns are at odds with Nobel laureates Eugene Fama’s and Robert Shiller’s award-winning asset-pricing models.
While the two economists’ approaches are very different, even opposite, Hsu argues that both “conclude that market valuation ratios forecast five-year returns with satisfactory accuracy.”
Again, despite their many differences, both would agree that high P/E ratios and low dividend yields reflect high equity demand.
“This willingness to bid up prices must, at some point, result in lower-than-average future return,” writes Hsu, who notes that the Shiller cyclically adjusted P/E (CAPE) ratio “spectacularly forecasted the carnage of the 2000 tech bust and the 2008 global financial crisis.”
Best Heal Care Companies To Invest In 2015: Intel Corporation(INTC)
Intel Corporation engages in the design, manufacture, and sale of integrated circuits for computing and communications industries worldwide. It offers microprocessor products used in notebooks, netbooks, desktops, servers, workstations, storage products, embedded applications, communications products, consumer electronics devices, and handhelds. The company also provides system on chip products that integrate its core processing functionalities with other system components, such as graphics, audio, and video, onto a single chip. In addition, it offers chipset products that send data between the microprocessor and input, display, and storage devices, including keyboard, mouse, monitor, hard drive, and CD, DVD, or Blu-ray drives; motherboards designed for desktop, server, and workstation platforms, and that has connectors for attaching devices to the bus; and wired and wireless connectivity products consisting of network adapters and embedded wireless cards used to translate and transmit data across networks. Further, the company provides NAND flash memory products primarily used in portable memory storage devices, digital camera memory cards, and solid-state drives; software products comprising operating systems, middleware, and tools used to develop, run, and manage various enterprise, consumer, embedded, and handheld devices; and software development tools that enable the creation of applications. Additionally, it develops computing platforms, which are integrated hardware and software computing technologies designed to offer an optimized solution. The company sells its products principally to original equipment manufacturers, original design manufacturers, PC components and other products users, and other manufacturers of industrial and communications equipment. It has a strategic alliance with Scientific Conservation Inc. Intel Corporation was founded in 1968 and is based in Santa Clara, California.
Advisors' Opinion:- [By Steven Russolillo]
Apple, which started paying a regular dividend last year, is illustrative of the Nasdaq�� trend. The iPhone and iPad maker has transformed from a high-flying growth stock to one that’s more characteristic of a plodding value stock over the past year, a fate similar to the likes of Microsoft, Cisco and Intel Corp.(INTC)
- [By Jon C. Ogg]
24/7 Wall St. found that four of the thirty DJIA stocks are overvalued if you look at the average estimates from Wall Street analysts. Stocks have to be assigned some sort of value, and the Thomson Reuters consensus price target is one metric which many investors use as a judge of a stock’s upside potential. This shows that investors have to start thinking about what to do in shares of American Express Company (NYSE: AXP), Intel Corporation (NASDAQ: INTC), 3M Co. (NYSE: MMM) and Microsoft Corp. (NASDAQ: MSFT).
- [By Selena Maranjian]
Intel (NASDAQ: INTC )
To earn their high scores, the companies above engaged in a variety of good practices such as paying employees for some of their volunteering time, loaning talent, and permitting the use of facilities. Each company's total annual giving was also considered.
Digging deeper
So what, exactly, are these companies doing right? Here are a few examples of their philanthropic practices: - [By Steve Heller]
Picture an Apple (NASDAQ: AAPL ) iPad running on Intel's (NASDAQ: INTC ) upcoming Bay Trail tablet processor, making it capable of running the full version of Mac OS X. That's the thought behind an iPad Pro tablet. With the prospect of tablets running the full version of Microsoft (NASDAQ: MSFT ) Windows 8 on the horizon, Apple may be forced to enter the hybrid computing space. In this video, Fool contributor Steve Heller and analyst Rex Moore discuss the prospect of an iPad Pro tablet and what it could mean for Apple investors longer term.
5 Best Dividend Stocks To Buy For 2014: Verizon Communications Inc.(VZ)
Verizon Communications Inc. provides communication services. The company operates through two segments, Domestic Wireless and Wireline. The Domestic Wireless segment offers wireless voice and data services; and sells equipment in the United States. The Wireline segment provides voice, Internet access, broadband video and data, Internet protocol network, network access, long distance, and other services in the United States and internationally. The company serves consumer, business, and government customers, as well as carriers. As of December 31, 2010, its network covered a population of approximately 292 million and provided service to a customer base of approximately 94.1 million. The company was formerly known as Bell Atlantic Corporation and changed its name to Verizon Communications Inc. in June 2000. Verizon Communications Inc. was founded in 1983 and is based in New York, New York.
Advisors' Opinion:- [By Jonas Elmerraji]
Communications giant Verizon (VZ) is the league leader in just about every business it operates: The firm boasts the biggest landline network in the country, the biggest wireless network in the country, and arguably the fastest residential broadband solution in the country in FiOS. That collection of services is key for one very big reason: Verizon's cross-selling opportunities are massive.
Capital allocation hasn't been a problem for VZ. The firm has massive (and growing) infrastructure, and expansion and upkeep come with some serious costs. Verizon has done a good job of reducing its total debt by selling off non-core businesses, leaving more cash available to pay for current operations -- and for dividends. For many consumers, Verizon is synonymous with wireless. The firm's mobile phone arm provides service to around 100 million customers across the U.S., but unlike top rival AT&T (T), VZ only owns 55% of its cellular business.
And while it works to convince its minority partner to sell their stake, VZ is sitting on a whole lot of balance sheet liquidity. That leaves room for the firm to reward patient shareholders with a dividend hike. Right now, VZ pays a 51.5-cent quarterly dividend that adds up to a 4.24% yield. Shareholders could see a raise happen this fall.
5 Best Dividend Stocks To Buy For 2014: United Parcel Service Inc.(UPS)
United Parcel Service, Inc., a package delivery company, provides transportation, logistics, and financial services in the United States and internationally. It operates in three segments: U.S. Domestic Package, International Package, and Supply Chain & Freight. The U.S. Domestic Package segment engages in the time-definite delivery of letters, documents, and packages in the United States. The International Package segment offers air and ground delivery of small packages and letters to approximately 220 countries and territories, including shipments outside the United States, as well as shipments with either origin or distribution outside the United States; export services; and domestic services move shipments within a country?s borders. The Supply Chain & Freight segment provides forwarding and logistics services, such as supply chain design and management, freight distribution, customs brokerage, mail, and consulting services in approximately 195 countries and territorie s; and less-than-truckload and truckload services to customers in North America. In addition, the company offers various technology solutions for automated shipping, visibility, and billing; information technology systems and distribution facilities to various industries comprising healthcare, technology, and consumer/retail; and a portfolio of financial services that provides customers with short-term working capital, government guaranteed lending, global trade financing, credit cards, and export financing. It operates a fleet of approximately 99,800 package cars, vans, tractors, and motorcycles; an air fleet of 527 aircraft; and 33,800 containers used to transport cargo in its aircraft. The company was founded in 1907 and is headquartered in Atlanta, Georgia.
Advisors' Opinion:- [By WALLSTCHEATSHEET]
United Parcel Service is a package delivery company that offers its services to consumers and companies around the world. Labor union problems have still not been resolved which may be a problem during the upcoming holiday season. The stock has been surging higher over the last several years and is now trading slightly below all time high prices. Over the last four quarters, earnings have been decreasing while revenues have been increasing which has produced mixed feelings among investors about recent earnings announcements. Relative to its peers and sector, United Parcel Service has been a weak year-to-date performer. WAIT AND SEE what United Parcel Services reports during its upcoming earnings release.
- [By Chuck Saletta]
When bad news is good and good news is better
Either way, not every pick in the portfolio rose last week. Package delivery giant United Parcel Service (NYSE: UPS ) actually dropped around 1.6% on the week, driven in large part from Friday's earnings pre-announcement. By both indicating that it would miss expectations and that it was guiding down forward-looking earnings projections, UPS sent its shares tumbling down almost 6% on the day.
5 Best Dividend Stocks To Buy For 2014: Nucor Corporation(NUE)
Nucor Corporation, together with its subsidiaries, engages in the manufacture and sale of steel and steel products in North America and internationally. It operates through three segments: Steel Mills, Steel Products, and Raw Materials. The Steel Mills segment produces hot and cold-rolled sheet steel; plate steel; structural steel comprising wide-flange beams, beam blanks, and sheet piling; and bar steel, such as blooms, billets, concrete reinforcing bar, merchant bar, and special bar quality products. The Steel Products segment offers steel joists and joist girders, steel deck, fabricated concrete reinforcing steel, cold finished steel, steel fasteners, metal building systems, light gauge steel framing, steel grating and expanded metal, and wire and wire mesh products. The Raw Materials segment produces direct reduced iron (DRI); brokers ferrous and nonferrous metals, pig iron, hot briquetted iron, and DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap metal products. The company?s operations also include various international trading companies that buy and sell steel and steel products. It sells its hot-rolled steel and cold-rolled steel to steel service centers, fabricators, and manufacturers; steel joists and joist girders, and steel deck to general contractors and fabricators; and cold finished steel and steel fasteners to distributors and manufacturers. The company?s products are used by contractors in constructing highways, bridges, reservoirs, utilities, hospitals, schools, airports, stadiums, and high-rise buildings. Nucor Corporation was founded in 1940 and is based in Charlotte, North Carolina.
Advisors' Opinion:- [By Ben Levisohn]
United States Steel (X) has gained 3.1% to $19.39 today, while AK Steel (AKS) has gained 4.6% to $3.73 and Steel Dynamics (STLD) has jumped 3.2% to $16.33. The odd man out: Nucor (NUE), which has dropped 1% to $48.71.
No comments:
Post a Comment