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DodoOne

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04-22

Thank you for sharing. It is interesting reading and learning from your perspective.

Sorry, the original content has been removed

02-06

Let's see where it goes from here

2023-09-05

Food for thought. This makes sense to me. So, what does it mean? Should I buy ETF or not?Get out of the market?? What do you think?

Sorry, the original content has been removed

2023-06-22

Food for thought

7 Stocks to Sell Immediately Before the Bubble Bursts

2023-06-22

Interesting...

Retail Investors Set New Record, Pour $1.5B Into Single Stocks In A Week — Tesla, Apple, Nvidia Get Bulk Of Inflows

2023-06-14

Food for thought...

Stocks Are Dangerously Overvalued With More Rate Hikes To Come

2023-06-10

Always learning.... let's learn together!

Debt Metrics: How To Interpret Them And When They Matter

2023-05-19

Makes sense...

@JC888:Top 3 Stocks To Exit In A US Debit Limit Meltdown.

2023-04-04

Be careful....

JPMorgan’s Kolanovic Warns Stocks Are in "Calm Before the Storm"

2023-04-03

Name to remember - Manan Gosalia

SVB’s Fall Stunned Even the One Stock Analyst Who Said to Sell

2023-04-03

Name to remember - Manan Gosalia

Sorry, the original content has been removed

2023-03-20

Interesting...

@ToughCoyote:The People's Bank of China once again announced to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points, which is the same as the RRR cut in December last year. RMB 100 million, the weighted average deposit reserve ratio of financial institutions after the reduction is about 7.6%, this move is contrary to the Fed's interest rate hike situation, which causes the inversion of the evil interest to become larger and larger. In disguised investors, the funds of investors continue to stay in the investment of US bonds, bank fixed deposits and stock markets, which may once again affect the outflow of large foreign giants. situation. The reason for the domestic government's RRR cut is that the economic data is not as expected, and the year-on-year growth of r

2023-03-20

Good to know...

@MaverickWealthBuilder:How will Credit Suisse Crisis Affect Global Banks?

2023-03-20

Alternatives..

@FundMall:Tiger Vault| A Good Alternative to Bank Deposits?

2023-03-20

Great ariticle, would you like to share it?

@MaverickWealthBuilder:How will Credit Suisse Crisis Affect Global Banks?

2023-03-20

Great ariticle, would you like to share it?

@Tiger_comments:Wanna Know| How to Draw & Use a Support/Resistance Line

2023-03-20

Great ariticle, would you like to share it?

@Capital_Insights:Banking Crisis is Over? Impact to Economy & Central Banks

2023-03-20

Great ariticle, would you like to share it?

Sorry, the original content has been removed

2023-02-08

Not true! https://tigr.link/HjFgZ

BBBY Rebounded Over 11% in Premarket Trading After Receiving $225 Million in Funding

2022-12-15

Thanks for an interesting article

Tesla: I'd Buy After A 53.4% Drop

Go to Tiger App to see more news

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It is interesting reading and learning from your perspective.","listText":"Thank you for sharing. It is interesting reading and learning from your perspective.","text":"Thank you for sharing. It is interesting reading and learning from your perspective.","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/297871838871808","repostId":"2429563099","repostType":2,"isVote":1,"tweetType":1,"viewCount":26,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":271132045447288,"gmtCreate":1707232130593,"gmtModify":1707232135109,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Let's see where it goes from here","listText":"Let's see where it goes from here","text":"Let's see where it goes from here","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/271132045447288","isVote":1,"tweetType":1,"viewCount":134,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":216654715240472,"gmtCreate":1693927619305,"gmtModify":1693927623565,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Food for thought. This makes sense to me. &nbsp;So, what does it mean? Should I buy ETF or not?Get out of the market?? What do you think?&nbsp;","listText":"Food for thought. This makes sense to me. &nbsp;So, what does it mean? Should I buy ETF or not?Get out of the market?? What do you think?&nbsp;","text":"Food for thought. This makes sense to me. So, what does it mean? Should I buy ETF or not?Get out of the market?? What do you think?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/216654715240472","repostId":"2365054063","repostType":2,"isVote":1,"tweetType":1,"viewCount":98,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":190085112057864,"gmtCreate":1687433018686,"gmtModify":1687433021951,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Food for thought","listText":"Food for thought","text":"Food for thought","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/190085112057864","repostId":"1150488641","repostType":2,"repost":{"id":"1150488641","pubTimestamp":1687447634,"share":"https://www.laohu8.com/m/news/1150488641?lang=&edition=full","pubTime":"2023-06-22 23:27","market":"us","language":"en","title":"7 Stocks to Sell Immediately Before the Bubble Bursts","url":"https://stock-news.laohu8.com/highlight/detail?id=1150488641","media":"InvestorPlace","summary":"Deciding on which stocks to sell before a bubble burst depends on first defining where bubbles exist","content":"<html><head></head><body><p>Deciding on which stocks to sell before a bubble burst depends on first defining where bubbles exist. That’s difficult to predict as the U.S. economy continues to confound even the best economic minds. That’s not to say there aren’t high-risk bubble stocks to sell. There are. In fact, despite positive signs, bubbles continue to exist everywhere. Macroeconomic factors suggest the U.S. economy is not healthy overall. U.S. debt remains sky-high at the government level. The deficit is growing and recent theatrics in Congress haven’t changed anything for the better. In addition, bubbles extend to credit card debt, car loan debt, student loan debt, the housing market, the commercial real estate market, and tech stocks that have propped up a surging stock market. A severe recession remains entirely possible. Whether that occurs or not it makes sense to drop riskier stocks currently. </p><h2 style=\"text-align: start;\">High-Risk Bubble Stocks: Wells Fargo (WFC)</h2><p>Investors should seriously consider dropping <strong>Wells Fargo</strong> (NYSE:<strong><u>WFC</u></strong>). Trust in banks has taken a hit in 2023. Among big banks, only <strong>JPMorgan Chase</strong> (NYSE:<strong><u>JPM</u></strong>) has been spared in 2023. That’s largely due to its size and the leading role it played when regional banks collapsed months earlier. </p><p style=\"text-align: start;\">The point here is that Wells Fargo was already suffering a lack of trust prior to the most recent meltdown. The company already got caught for creating fake accounts in order to make its operations appear stronger than they were. It’s a wild and concerning thing to do for any bank, especially one of the largest in the U.S. The bank was trying to put that scandal behind it. It clearly did a poor job as it recently was fined $1 billion for overstating its progress in cleaning up that scandal. </p><p style=\"text-align: start;\">I believe it’s fair to state that Wells Fargo is not a trustworthy bank at this point. Given that you shouldn’t inherently trust banks overall, that’s probably saying something. Again, consider Wells Fargo a high-risk bubble stock to sell now.</p><h2 style=\"text-align: start;\">High-Risk Bubble Stocks: Regions Financial (RF)</h2><p><strong>Regions Financial</strong> (NYSE:<strong><u>RF</u></strong>) is a regional bank and stock that offers a catch-22 in terms of investing. It’s also another high-risk bubble stock to sell. The company appears to be doing well based on its first-quarter results. Earnings are up, revenues increased by 22%, and it seems to be heading toward a better place. That’s the magic of increased interest rates that increase net interest income. </p><p style=\"text-align: start;\">Regions Financial serves the southeast, deep south, and midwest. But it is most concentrated across Tennessee, Mississippi, Alabama, Georgia, and Florida. Florida, Mississippi, Alabama, and Georgia all happen to be among the states that struggle the most with credit card debt. So, with credit card debt above $1 trillion and a clear bubble at hand, Regions Financial is at risk. </p><p style=\"text-align: start;\">Commercial real estate and mortgage loans make up roughly one-third of its outstanding loans. Those are bubbles of their own. The overall picture for RF stock is a high-risk bank exposed to serious bubbles that continue to brew.  </p><h2 style=\"text-align: start;\">High-Risk Bubble Stocks: SoFi Technologies (SOFI)</h2><p>The clearest reason to sell<strong> SoFi Technologies</strong> (NASDAQ:<strong><u>SOFI</u></strong>) stock today is simply that it has gotten too hot, too quickly. The stock was one of the big winners to emerge from the debt ceiling deal. That deal set a clear date for the resumption of federal student loan payments. SoFi Technologies, which holds significant student loans, is a clear beneficiary of the deal then. </p><p style=\"text-align: start;\">Share prices basically doubled due to the discussions and deal. So, investors should sell it in order to simply capture their profit. But that’s not really why I’m bearish on SOFI stock. Instead, I believe that SoFi Technologies now suffers from the real risk that the restart of repayments won’t be as strong as analysts believe. </p><p style=\"text-align: start;\">There’s a very real risk that strained student loan holders will default in record numbers in the coming months. They were already defaulting at record rates prior to the pause. They have less money now than they did then so it only makes sense that things are going t get worse. </p><h2 style=\"text-align: start;\">Vornado Realty Trust (VNO)</h2><p>I’ve written about<strong> Vornado Realty Trust </strong>(NYSE:<strong><u>VNO</u></strong>) as a stock to avoid several times recently. I continue to believe it should be avoided today. The commercial real estate firm is heavily concentrated across office spaces in New York, Chicago, and San Francisco. It should be high on any list of commercial real estate bubble stocks. Vornado Realty Trust has postponed dividend payments until the end of 2023. REIT stocks use high-yield dividends to lure investors. When they pay things are great. It was paying a very high 11%. That income now no longer exists. </p><p style=\"text-align: start;\">In the first quarter, Vornado’s net income was five-fold. San Francisco has recently been in the headlines as hotels close after failing to make payments. Cracks are emerging in the commercial real estate sector. Vornado’s markets also suffer from being in geographies in which workers have much more sway. Return-to-office mandates aren’t going to go over well in San Francisco, New York, and Chicago. It all spells continued trouble and bigger losses. </p><h2 style=\"text-align: start;\">Nvidia (NVDA)</h2><p>If there is a single tech stock at the most risk, <strong>Nvidia</strong> (NASDAQ:<strong><u>NVDA</u></strong>) has to be it. The emergence of AI has catalyzed a recent surge across the tech industry. That surge has been powerful enough to raise markets overall, accounting for a great percentage of overall market gains of late. </p><p style=\"text-align: start;\">Nvidia’s chips have emerged to be a keystone to the generative AI progress that promises to rapidly increase productivity and revenues along with it. The firm’s huge Q1 earnings release and second-quarter guidance took it from a potential AI champion to the clear winner. </p><p style=\"text-align: start;\">Concerns of an AI bubble cropped up as soon as earnings were released. They died down and NVDA shares jumped higher again. </p><p style=\"text-align: start;\">I’m not saying investors should dump Nvidia now. I have no way to accurately say it’s going to cool off. Honestly, I thought it would stay at $390 but I was wrong. It’s now at $430. Yet, more and more bears are emerging drawing comparisons between AI and the Dot com bubble. It’s almost moot to say take profits now. I’m sure most readers will have done that if they’ve been lucky enough to buy it months ago. Yet, it’s fair to warn that buying in now is clearly risky. </p><h2 style=\"text-align: start;\">Armour Residential REIT (ARR)</h2><p><strong>Armour Residential REIT’s</strong> (NYSE:<strong><u>ARR</u></strong>) price chart tells investors a great deal about the stock. Inflation concerns that cropped up in late 2021 and culminated in rate hikes beginning in March of 2022 correlate nicely with its arc. </p><p style=\"text-align: start;\">Share prices have more than halved since then. Funnily enough, the company was arguably doing worse prior to Fed rate hikes. Its net loss in the first quarter of 2022 totaled $66.43 million. It narrowed to $34.35 million in the first quarter of this year. That was mostly on account of securities trading discrepancies during those two respective periods. </p><p style=\"text-align: start;\">Net interest income dropped by a factor of three. That means interest rate increases are hurting the firm.  What’s particularly troublesome is that the company almost brags about raising $181 million in capital by issuing 30 million new shares in the first quarter. There are only 190 million in total. That should be dilutive. The dividend yielding 18.4% is a siren song that investors should avoid. Vornado Realty Trust, just above, should tell investors all they need to know in that regard. </p><h2 style=\"text-align: start;\">UBS Group (UBS)</h2><p><strong>UBS Group</strong> (NYSE:<strong><u>UBS</u></strong>) emerged as a winner as U.S. regional bank meltdown contagion spread to Europe and claimed <strong>Credit Suisse</strong>. UBS was forced to save Credit Suisse by regulators. It initially bristled at the prospect of doing so but the result is that there is no one single European money manager for the global elite. </p><p style=\"text-align: start;\">The forced merger will result in tens of thousands of jobs lost as UBS sheds Credit Suisse employees in the aftermath. As sympathetic as I am to them, that’s no reason to suggest it’s time to sell UBS. Frankly, it should benefit share prices due to the implied increase in efficiency. </p><p style=\"text-align: start;\">The reason is that it isn’t a well-run bank despite its association with the global elite and a previously untouchable Swiss banking sector. Multiple financial metrics indicate real distress. In particular, UBS’ equity-to-asset ratio is very weak. The lower the ratio, the more likely a bank is to be reliant on debt financing. UBS’ ratio is worse than 9 out of 10 banks. Further, it simply doesn’t create value as revealed by a return on investment of 0%.  </p></body></html>","source":"investorplace","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>7 Stocks to Sell Immediately Before the Bubble Bursts</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\n7 Stocks to Sell Immediately Before the Bubble Bursts\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-22 23:27 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://investorplace.com/2023/06/7-stocks-to-sell-immediately-before-the-bubble-bursts-high-risk-bubble-stocks/><strong>InvestorPlace</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Deciding on which stocks to sell before a bubble burst depends on first defining where bubbles exist. That’s difficult to predict as the U.S. economy continues to confound even the best economic minds...</p>\n\n<a href=\"https://investorplace.com/2023/06/7-stocks-to-sell-immediately-before-the-bubble-bursts-high-risk-bubble-stocks/\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"RF":"地区金融","UBS":"瑞银","ARR":"ARMOUR住宅房地产公司","SOFI":"SoFi Technologies Inc.","WFC":"富国银行","VNO":"沃那多房信","NVDA":"英伟达"},"source_url":"https://investorplace.com/2023/06/7-stocks-to-sell-immediately-before-the-bubble-bursts-high-risk-bubble-stocks/","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1150488641","content_text":"Deciding on which stocks to sell before a bubble burst depends on first defining where bubbles exist. That’s difficult to predict as the U.S. economy continues to confound even the best economic minds. That’s not to say there aren’t high-risk bubble stocks to sell. There are. In fact, despite positive signs, bubbles continue to exist everywhere. Macroeconomic factors suggest the U.S. economy is not healthy overall. U.S. debt remains sky-high at the government level. The deficit is growing and recent theatrics in Congress haven’t changed anything for the better. In addition, bubbles extend to credit card debt, car loan debt, student loan debt, the housing market, the commercial real estate market, and tech stocks that have propped up a surging stock market. A severe recession remains entirely possible. Whether that occurs or not it makes sense to drop riskier stocks currently. High-Risk Bubble Stocks: Wells Fargo (WFC)Investors should seriously consider dropping Wells Fargo (NYSE:WFC). Trust in banks has taken a hit in 2023. Among big banks, only JPMorgan Chase (NYSE:JPM) has been spared in 2023. That’s largely due to its size and the leading role it played when regional banks collapsed months earlier. The point here is that Wells Fargo was already suffering a lack of trust prior to the most recent meltdown. The company already got caught for creating fake accounts in order to make its operations appear stronger than they were. It’s a wild and concerning thing to do for any bank, especially one of the largest in the U.S. The bank was trying to put that scandal behind it. It clearly did a poor job as it recently was fined $1 billion for overstating its progress in cleaning up that scandal. I believe it’s fair to state that Wells Fargo is not a trustworthy bank at this point. Given that you shouldn’t inherently trust banks overall, that’s probably saying something. Again, consider Wells Fargo a high-risk bubble stock to sell now.High-Risk Bubble Stocks: Regions Financial (RF)Regions Financial (NYSE:RF) is a regional bank and stock that offers a catch-22 in terms of investing. It’s also another high-risk bubble stock to sell. The company appears to be doing well based on its first-quarter results. Earnings are up, revenues increased by 22%, and it seems to be heading toward a better place. That’s the magic of increased interest rates that increase net interest income. Regions Financial serves the southeast, deep south, and midwest. But it is most concentrated across Tennessee, Mississippi, Alabama, Georgia, and Florida. Florida, Mississippi, Alabama, and Georgia all happen to be among the states that struggle the most with credit card debt. So, with credit card debt above $1 trillion and a clear bubble at hand, Regions Financial is at risk. Commercial real estate and mortgage loans make up roughly one-third of its outstanding loans. Those are bubbles of their own. The overall picture for RF stock is a high-risk bank exposed to serious bubbles that continue to brew.  High-Risk Bubble Stocks: SoFi Technologies (SOFI)The clearest reason to sell SoFi Technologies (NASDAQ:SOFI) stock today is simply that it has gotten too hot, too quickly. The stock was one of the big winners to emerge from the debt ceiling deal. That deal set a clear date for the resumption of federal student loan payments. SoFi Technologies, which holds significant student loans, is a clear beneficiary of the deal then. Share prices basically doubled due to the discussions and deal. So, investors should sell it in order to simply capture their profit. But that’s not really why I’m bearish on SOFI stock. Instead, I believe that SoFi Technologies now suffers from the real risk that the restart of repayments won’t be as strong as analysts believe. There’s a very real risk that strained student loan holders will default in record numbers in the coming months. They were already defaulting at record rates prior to the pause. They have less money now than they did then so it only makes sense that things are going t get worse. Vornado Realty Trust (VNO)I’ve written about Vornado Realty Trust (NYSE:VNO) as a stock to avoid several times recently. I continue to believe it should be avoided today. The commercial real estate firm is heavily concentrated across office spaces in New York, Chicago, and San Francisco. It should be high on any list of commercial real estate bubble stocks. Vornado Realty Trust has postponed dividend payments until the end of 2023. REIT stocks use high-yield dividends to lure investors. When they pay things are great. It was paying a very high 11%. That income now no longer exists. In the first quarter, Vornado’s net income was five-fold. San Francisco has recently been in the headlines as hotels close after failing to make payments. Cracks are emerging in the commercial real estate sector. Vornado’s markets also suffer from being in geographies in which workers have much more sway. Return-to-office mandates aren’t going to go over well in San Francisco, New York, and Chicago. It all spells continued trouble and bigger losses. Nvidia (NVDA)If there is a single tech stock at the most risk, Nvidia (NASDAQ:NVDA) has to be it. The emergence of AI has catalyzed a recent surge across the tech industry. That surge has been powerful enough to raise markets overall, accounting for a great percentage of overall market gains of late. Nvidia’s chips have emerged to be a keystone to the generative AI progress that promises to rapidly increase productivity and revenues along with it. The firm’s huge Q1 earnings release and second-quarter guidance took it from a potential AI champion to the clear winner. Concerns of an AI bubble cropped up as soon as earnings were released. They died down and NVDA shares jumped higher again. I’m not saying investors should dump Nvidia now. I have no way to accurately say it’s going to cool off. Honestly, I thought it would stay at $390 but I was wrong. It’s now at $430. Yet, more and more bears are emerging drawing comparisons between AI and the Dot com bubble. It’s almost moot to say take profits now. I’m sure most readers will have done that if they’ve been lucky enough to buy it months ago. Yet, it’s fair to warn that buying in now is clearly risky. Armour Residential REIT (ARR)Armour Residential REIT’s (NYSE:ARR) price chart tells investors a great deal about the stock. Inflation concerns that cropped up in late 2021 and culminated in rate hikes beginning in March of 2022 correlate nicely with its arc. Share prices have more than halved since then. Funnily enough, the company was arguably doing worse prior to Fed rate hikes. Its net loss in the first quarter of 2022 totaled $66.43 million. It narrowed to $34.35 million in the first quarter of this year. That was mostly on account of securities trading discrepancies during those two respective periods. Net interest income dropped by a factor of three. That means interest rate increases are hurting the firm.  What’s particularly troublesome is that the company almost brags about raising $181 million in capital by issuing 30 million new shares in the first quarter. There are only 190 million in total. That should be dilutive. The dividend yielding 18.4% is a siren song that investors should avoid. Vornado Realty Trust, just above, should tell investors all they need to know in that regard. UBS Group (UBS)UBS Group (NYSE:UBS) emerged as a winner as U.S. regional bank meltdown contagion spread to Europe and claimed Credit Suisse. UBS was forced to save Credit Suisse by regulators. It initially bristled at the prospect of doing so but the result is that there is no one single European money manager for the global elite. The forced merger will result in tens of thousands of jobs lost as UBS sheds Credit Suisse employees in the aftermath. As sympathetic as I am to them, that’s no reason to suggest it’s time to sell UBS. Frankly, it should benefit share prices due to the implied increase in efficiency. The reason is that it isn’t a well-run bank despite its association with the global elite and a previously untouchable Swiss banking sector. Multiple financial metrics indicate real distress. In particular, UBS’ equity-to-asset ratio is very weak. The lower the ratio, the more likely a bank is to be reliant on debt financing. UBS’ ratio is worse than 9 out of 10 banks. Further, it simply doesn’t create value as revealed by a return on investment of 0%.","news_type":1},"isVote":1,"tweetType":1,"viewCount":79,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":190082892607608,"gmtCreate":1687432477153,"gmtModify":1687432481014,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Interesting...","listText":"Interesting...","text":"Interesting...","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/190082892607608","repostId":"1129801578","repostType":2,"repost":{"id":"1129801578","pubTimestamp":1687424680,"share":"https://www.laohu8.com/m/news/1129801578?lang=&edition=full","pubTime":"2023-06-22 17:04","market":"us","language":"en","title":"Retail Investors Set New Record, Pour $1.5B Into Single Stocks In A Week — Tesla, Apple, Nvidia Get Bulk Of Inflows","url":"https://stock-news.laohu8.com/highlight/detail?id=1129801578","media":"Benzinga","summary":"ZINGER KEY POINTSMost of the inflow into single stocks reportedly went into Tesla, Apple and Nvidia.","content":"<html><head></head><body><h4 style=\"text-align: start;\">ZINGER KEY POINTS</h4><ul><li><p><strong>Most of the inflow into single stocks reportedly went into Tesla, Apple and Nvidia.</strong></p></li><li><p><strong>Nvidia has registered over 200% gains since the beginning of the year while Tesla has witnessed over 140% rise.</strong></p></li><li><p><strong>Analysts have sounded out alarms about the possibility of a correction.</strong></p></li></ul><p>Retail investors appear to be unperturbed by the strong momentum that equity markets witnessed so far into the year and are reluctant to take a break from infusing fresh funds into stocks.</p><p style=\"text-align: start;\">According to data compiled by <strong>JPMorgan Chase &amp; Co.</strong> strategist <strong>Peng Cheng, </strong>the category of non-professional investors bought a whopping $1.5 billion of single stocks in the week ending Tuesday, marking an all-time high, reported Bloomberg.</p><p style=\"text-align: start;\">Most of the inflow into single stocks went into just three names — <strong>Tesla Inc</strong>, <strong>Apple Inc </strong>and <strong>NVIDIA Corp</strong>, which accounted for 43% of the <strong>S&amp;P 500&#39;s </strong>gains this year, the report said.</p><p>Nvidia has registered over 200% gains since the beginning of the year while Tesla has witnessed over 140% rise during the period. Apple shares have gained over 47% on a year-to-date basis. At the same time, the S&amp;P 500 has risen just over 14% while the Nasdaq Composite has gained about 30% in 2023, according to Benzinga Pro.</p><p style=\"text-align: start;\"><strong>Skepticism:</strong> Much of the rally this year was a result of AI-led optimism. Retail investors jumped on the wagon not intending to be left behind after institutions piled into such stocks. What is noteworthy is the fact that the rally came in the midst of a banking crisis in the U.S., consecutive rate hikes by the <strong>Federal Reserve</strong> to tackle decades-high inflation and a lingering debt ceiling crisis that almost pushed the government into default.</p><p>Analysts, however, are wary of the momentum and have repeatedly sounded out alarms about the possibility of a correction. For instance, <strong>Morgan Stanley’s</strong> top equity strategist <strong>Mike Wilson</strong> recently reiterated his year-end target of 3,900 for the S&amp;P 500 while warning that a profit recession is still underway. “Inflation is going to come down. It’s not going to be good for stocks because that is where the earnings power has been coming from,” said Wilson.</p></body></html>","source":"lsy1606299360108","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Retail Investors Set New Record, Pour $1.5B Into Single Stocks In A Week — Tesla, Apple, Nvidia Get Bulk Of Inflows</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nRetail Investors Set New Record, Pour $1.5B Into Single Stocks In A Week — Tesla, Apple, Nvidia Get Bulk Of Inflows\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-22 17:04 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.benzinga.com/markets/equities/23/06/32959895/retail-investors-set-new-record-pour-1-5b-into-single-stocks-in-a-week-tesla-apple-nvidia-get-bu><strong>Benzinga</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>ZINGER KEY POINTSMost of the inflow into single stocks reportedly went into Tesla, Apple and Nvidia.Nvidia has registered over 200% gains since the beginning of the year while Tesla has witnessed over...</p>\n\n<a href=\"https://www.benzinga.com/markets/equities/23/06/32959895/retail-investors-set-new-record-pour-1-5b-into-single-stocks-in-a-week-tesla-apple-nvidia-get-bu\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"NVDA":"英伟达","AAPL":"苹果","TSLA":"特斯拉"},"source_url":"https://www.benzinga.com/markets/equities/23/06/32959895/retail-investors-set-new-record-pour-1-5b-into-single-stocks-in-a-week-tesla-apple-nvidia-get-bu","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1129801578","content_text":"ZINGER KEY POINTSMost of the inflow into single stocks reportedly went into Tesla, Apple and Nvidia.Nvidia has registered over 200% gains since the beginning of the year while Tesla has witnessed over 140% rise.Analysts have sounded out alarms about the possibility of a correction.Retail investors appear to be unperturbed by the strong momentum that equity markets witnessed so far into the year and are reluctant to take a break from infusing fresh funds into stocks.According to data compiled by JPMorgan Chase & Co. strategist Peng Cheng, the category of non-professional investors bought a whopping $1.5 billion of single stocks in the week ending Tuesday, marking an all-time high, reported Bloomberg.Most of the inflow into single stocks went into just three names — Tesla Inc, Apple Inc and NVIDIA Corp, which accounted for 43% of the S&P 500's gains this year, the report said.Nvidia has registered over 200% gains since the beginning of the year while Tesla has witnessed over 140% rise during the period. Apple shares have gained over 47% on a year-to-date basis. At the same time, the S&P 500 has risen just over 14% while the Nasdaq Composite has gained about 30% in 2023, according to Benzinga Pro.Skepticism: Much of the rally this year was a result of AI-led optimism. Retail investors jumped on the wagon not intending to be left behind after institutions piled into such stocks. What is noteworthy is the fact that the rally came in the midst of a banking crisis in the U.S., consecutive rate hikes by the Federal Reserve to tackle decades-high inflation and a lingering debt ceiling crisis that almost pushed the government into default.Analysts, however, are wary of the momentum and have repeatedly sounded out alarms about the possibility of a correction. For instance, Morgan Stanley’s top equity strategist Mike Wilson recently reiterated his year-end target of 3,900 for the S&P 500 while warning that a profit recession is still underway. “Inflation is going to come down. It’s not going to be good for stocks because that is where the earnings power has been coming from,” said Wilson.","news_type":1},"isVote":1,"tweetType":1,"viewCount":134,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":187048537161808,"gmtCreate":1686705422596,"gmtModify":1686705427608,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Food for thought...","listText":"Food for thought...","text":"Food for thought...","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/187048537161808","repostId":"2343567514","repostType":2,"repost":{"id":"2343567514","pubTimestamp":1686704403,"share":"https://www.laohu8.com/m/news/2343567514?lang=&edition=full","pubTime":"2023-06-14 09:00","market":"us","language":"en","title":"Stocks Are Dangerously Overvalued With More Rate Hikes To Come","url":"https://stock-news.laohu8.com/highlight/detail?id=2343567514","media":"Seekingalpha","summary":"Douglas Rissing The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will ","content":"<html><head></head><body><p>The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the Fed to revise its summary of economic projections to show a higher inflation outlook and more rate hikes on the dot plot.</p><p>This means that yields across the curve are likely to stay elevated and move higher in the months ahead at a time when liquidity is now being withdrawn from the overall market and equities are dangerously overvalued.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/2120bacd7ae744d7a9b26b91f6d1a51d\" tg-width=\"640\" tg-height=\"286\"/></p><p>Bloomberg</p><h2>More Rate Hikes</h2><p>The market is not predicting a June rate hike, with the odds at just 10% as of this writing, and it seems unlikely that Fed will try and surprise the market, given its history. But Fed Fund futures are pricing a nearly 70% chance of a rate hike by July. With the next FOMC meeting coming at the end of July, the Fed will have more data to assess its projected rate path. However, given the hotter core CPI and searing labor market reports, it will probably mean that the dot plot will reflect another rate hike or two in 2023.</p><p>The reason is that core inflation is expected to remain sticky, and the Cleveland Fed estimates Core CPI for June at 5.1%. This means the chance the Fed is done raising rates seems slim at this point, and that will likely be reflected in the dot plots when the Summary of Economic Projections comes out.</p><p>Additionally, headline CPI on a non-seasonal adjusted basis rose by 0.3% in May. That has inflation rising at a 4.4% annualized rate of change over the past three and six months. This does suggest that it may be challenging to get inflation down now that it is entering this 3% to 4% range. It&#39;s important to remember that CPI on a year over year is measured on a non-seasonally adjusted basis, and using a seasonally adjusted CPI metric to annualize the rate of change may understate actual inflation due to changes in seasonal adjustments, which happened in 2022.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/538b5d9f6f2e8956f767d8f53d71b8c9\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>This is why bond yields aren&#39;t coming down and are rising following the CPI report. Especially when looking at the back of the curve, as markets price in a higher for longer monetary policy from the Fed, with the 30-year rate rising back to 3.92%. But more importantly, real rates are pushing higher, with the 10-Yr TIP rate now trading at 1.58% and approaching that critical level of resistance that could lead to a big break out and push to new highs.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/b14a0538cce121027cd003790fb61875\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>The 10-yr TIP is a critical rate to follow because assets such as long duration growth are priced using real rates, with the Nasdaq 100 being key. The spread between the Nasdaq 100 earnings yield and the 10-yr real yield is now at 1.93%, levels not seen since the mid-2000s, when the Nasdaq was in the middle of a valuation reset from the 2000 bubble. More importantly, the Nasdaq 100 earnings yield is 235 bps below the historical average of the last 10 years.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/763a5b0d5b2b8c255726b71f988c02aa\" tg-width=\"640\" tg-height=\"363\"/></p><p>Bloomberg</p><p>The other piece of the puzzle is that liquidity is now starting to be withdrawn from the Nasdaq 100 futures market, as measured by the depth of the book. The last time the depth of the book declined was back in August of 2022, which also marked a significant top in the market.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/810669f93ed838683f831e50269496db\" tg-width=\"640\" tg-height=\"480\"/></p><p>CME Group</p><p>The addition and withdrawal of liquidity in the Nasdaq futures market in August 2022 coincided with a move up and down reserve balances held at the Federal Reserve. Currently, reserve balances are likely to decline due to the refill of the Treasury General Account. Further, as we move into the quarter end, the reverse repo activity should begin to climb, leading to lower reserves.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/9fc60fcb97695095105c1677befc4bd5\" tg-width=\"640\" tg-height=\"294\"/></p><p>Bloomberg</p><p>The path for inflation is sticky and will continue not to be smooth, and if the current rate of changes remains, headline inflation could very well begin to accelerate in the second half of 2023 as the base effects of the first half of 2022 wane. Translating into yields staying elevated and leaving stock particularly vulnerable as the equity risk premium gets dangerously narrow and liquidity is withdrawn from the market.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Stocks Are Dangerously Overvalued With More Rate Hikes To Come</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nStocks Are Dangerously Overvalued With More Rate Hikes To Come\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-14 09:00 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come><strong>Seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the ...</p>\n\n<a href=\"https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{".SPX":"S&P 500 Index",".IXIC":"NASDAQ Composite",".DJI":"道琼斯"},"source_url":"https://seekingalpha.com/article/4611258-stocks-are-dangerously-overvalued-with-more-rate-hikes-to-come","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2343567514","content_text":"The CPI report shows that inflation has remained stubbornly slow to fall, with the CORE CPI rising at 5.3%, surpassing expectations for 5.2%, creating a problem for the Fed. This will likely lead the Fed to revise its summary of economic projections to show a higher inflation outlook and more rate hikes on the dot plot.This means that yields across the curve are likely to stay elevated and move higher in the months ahead at a time when liquidity is now being withdrawn from the overall market and equities are dangerously overvalued.BloombergMore Rate HikesThe market is not predicting a June rate hike, with the odds at just 10% as of this writing, and it seems unlikely that Fed will try and surprise the market, given its history. But Fed Fund futures are pricing a nearly 70% chance of a rate hike by July. With the next FOMC meeting coming at the end of July, the Fed will have more data to assess its projected rate path. However, given the hotter core CPI and searing labor market reports, it will probably mean that the dot plot will reflect another rate hike or two in 2023.The reason is that core inflation is expected to remain sticky, and the Cleveland Fed estimates Core CPI for June at 5.1%. This means the chance the Fed is done raising rates seems slim at this point, and that will likely be reflected in the dot plots when the Summary of Economic Projections comes out.Additionally, headline CPI on a non-seasonal adjusted basis rose by 0.3% in May. That has inflation rising at a 4.4% annualized rate of change over the past three and six months. This does suggest that it may be challenging to get inflation down now that it is entering this 3% to 4% range. It's important to remember that CPI on a year over year is measured on a non-seasonally adjusted basis, and using a seasonally adjusted CPI metric to annualize the rate of change may understate actual inflation due to changes in seasonal adjustments, which happened in 2022.BloombergThis is why bond yields aren't coming down and are rising following the CPI report. Especially when looking at the back of the curve, as markets price in a higher for longer monetary policy from the Fed, with the 30-year rate rising back to 3.92%. But more importantly, real rates are pushing higher, with the 10-Yr TIP rate now trading at 1.58% and approaching that critical level of resistance that could lead to a big break out and push to new highs.BloombergThe 10-yr TIP is a critical rate to follow because assets such as long duration growth are priced using real rates, with the Nasdaq 100 being key. The spread between the Nasdaq 100 earnings yield and the 10-yr real yield is now at 1.93%, levels not seen since the mid-2000s, when the Nasdaq was in the middle of a valuation reset from the 2000 bubble. More importantly, the Nasdaq 100 earnings yield is 235 bps below the historical average of the last 10 years.BloombergThe other piece of the puzzle is that liquidity is now starting to be withdrawn from the Nasdaq 100 futures market, as measured by the depth of the book. The last time the depth of the book declined was back in August of 2022, which also marked a significant top in the market.CME GroupThe addition and withdrawal of liquidity in the Nasdaq futures market in August 2022 coincided with a move up and down reserve balances held at the Federal Reserve. Currently, reserve balances are likely to decline due to the refill of the Treasury General Account. Further, as we move into the quarter end, the reverse repo activity should begin to climb, leading to lower reserves.BloombergThe path for inflation is sticky and will continue not to be smooth, and if the current rate of changes remains, headline inflation could very well begin to accelerate in the second half of 2023 as the base effects of the first half of 2022 wane. Translating into yields staying elevated and leaving stock particularly vulnerable as the equity risk premium gets dangerously narrow and liquidity is withdrawn from the market.","news_type":1},"isVote":1,"tweetType":1,"viewCount":105,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":185497733431312,"gmtCreate":1686327072511,"gmtModify":1686327077213,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Always learning.... let's learn together!","listText":"Always learning.... let's learn together!","text":"Always learning.... let's learn together!","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/185497733431312","repostId":"2342211315","repostType":2,"repost":{"id":"2342211315","pubTimestamp":1686242362,"share":"https://www.laohu8.com/m/news/2342211315?lang=&edition=full","pubTime":"2023-06-09 00:39","market":"us","language":"en","title":"Debt Metrics: How To Interpret Them And When They Matter","url":"https://stock-news.laohu8.com/highlight/detail?id=2342211315","media":"seekingalpha","summary":"artoleshko/iStock via Getty Images Introduction Coming out of the pandemic, the Federal Reserve raised interest rates at an unprecedented pace. Over the course of about 15 months, the federal funds ra","content":"<html><body><p><figure><picture><img height=\"1025px\" loading=\"lazy\" sizes=\"(max-width: 768px) calc(100vw - 36px), (max-width: 1024px) calc(100vw - 132px), (max-width: 1200px) calc(66.6vw - 72px), 600px\" src=\"https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w750\" srcset=\"https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w1536 1536w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w1280 1280w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w1080 1080w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w750 750w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w640 640w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w480 480w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w320 320w, https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg?io=getty-c-w240 240w\" width=\"1536px\"/></picture><figcaption><p>artoleshko/iStock via Getty Images</p></figcaption></figure></p> <h2>Introduction</h2> <p>Coming out of the pandemic, the Federal Reserve raised interest rates at an unprecedented pace. Over the course of about 15 months, the federal funds rate was raised to 5.25%, a level not seen since<span> the </span>Great Recession<span>. What was unthinkable three years ago is now a reality, and it increasingly looks as if the days of \"easy money\" are finally over. Companies are facing a higher cost of capital, which puts them at risk especially those who succumbed to the siren songs and took on excessive debt. Debt is not a bad thing per se, but with extremely low interest rates, malinvestments are increasingly common. Companies are being acquired at ridiculous valuations (e.g., V.F. Corp. (</span>VFC<span>) </span>purchased<span> fashion label Supreme for 3.7 times sales), shares are being bought back at<span> all-time highs (e.g., The Home Depot, Inc. (</span></span>HD<span>) </span>bought back<span> $14.8 billion worth of stock at an average price of $388), and some companies would quickly </span>cease to exist<span> without a steady infusion of capital.</span></p> <p>I've probably looked at more than 100 companies in the last two years and rarely have I seen one that hasn't increased its debt to a more or less significant degree. On the surface, this looks like a pretty bad setup in an environment where interest rates are likely to remain high for a significant period of time. The devil is in the details, and it is important to take a close look at a company's debt using a number of metrics. However, some of the more or less commonly available ratios can easily be misinterpreted, leading to false positives or, probably worse, false negatives.</p> <p>In this article, I will discuss the most common leverage ratios - how they are defined, when they should be used, and when they can produce misleading results. Don't worry, no mathematical equations are used, and in fact, my preferred metrics can be explained in a sentence or two and provide illustrative results.</p> <h2>Debt To Assets, Debt To Capital</h2> <p>This is a straightforward ratio that puts debt in relation to a company's total assets, and is sometimes also referred to as the gearing ratio. \"Debt\" refers to all of a company's liabilities, such as interest-bearing debt and other liabilities, but definitions vary. Sometimes only funded debt is considered. In general, subtracting equity from total assets yields the most conservative version of the ratio because it implicitly takes into account all liabilities.</p> <p>The debt to capital ratio can be viewed as a variant of the debt to assets ratio, since \"capital\" includes both debt and equity. However, investors should be careful not to compare debt to asset or debt to capital ratios from different sources, and it is important to know what is included in debt and capital. In my view, given the simplicity of the approach, investors should take the time to look at the balance sheet and calculate the ratios themselves or stick with a single source.</p> <p>In general, a low debt to assets ratio indicates conservative management because a relatively high proportion of assets are financed by equity (Figure 1), which has no contractual right to interest payments, making the company more financially robust in a downturn. All other things being equal, a company with a low debt to assets ratio has a high loss-absorbing capacity (see below). A ratio greater than 1 means that a company has more liabilities than assets and is typically very inflexible in an economic downturn and increasingly at the mercy of its creditors (i.e., an increased risk of insolvency).</p> <p><figure contenteditable=\"false\"><picture><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862293416813943.png\"/></picture><figcaption><p>Figure 1: Comparison of a balance sheet with a low debt to assets ratio (left) and a high debt to assets ratio (right) (own work)</p></figcaption></figure></p> <p>Conversely, the higher the debt to assets ratio, the lower the loss absorption capacity and the higher the theoretical probability that there will not be enough left over to satisfy the claims of suppliers, pensioners, bondholders, shareholders and other stakeholders in the event of bankruptcy. This, of course, raises the question of the actual value of a company's assets in the event of bankruptcy - a question that is difficult (impossible?) to answer ex ante.</p> <p>While I acknowledge that most investors look at a company on a going concern basis and therefore do not necessarily have to know the \"true\" value of the assets, it is still important to watch for a potentially inflated asset base. Take, for example, a company that grows through acquisitions, assuming goodwill (the premium paid in addition to the value of the assets) in the process. If a company at some point in the future determines that the fair value of the acquired cash-generating unit is less than its carrying amount, the goodwill (and possibly other intangible assets) is impaired. This reduces the assets and affects the company's equity, resulting in an increase in the debt to assets ratio (Figure 2).</p> <p><figure contenteditable=\"false\"><picture><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862295396476214.png\"/></picture><figcaption><p>Figure 2: Schematic representation of the decrease in equity when a company recognizes a goodwill impairment charge (own work)</p></figcaption></figure></p> <p>Common sense tells us that companies whose assets consist of a high percentage of goodwill may need to recognize impairment charges at some point. Kraft Heinz Co (KHC), for example, had a debt to assets ratio of 45% at the end of 2017. 37% of assets consisted of goodwill and 50% consisted of other intangible assets (e.g., trademarks). In 2018, KHC incurred impairment charges of $7.0 billion and $8.9 billion on goodwill and other intangible assets, respectively. The company did not incur any additional debt in 2018, so impairment charges were the primary reason for the 500 basis point increase in KHC's debt to assets ratio.</p> <p>All in all, I'm not a big fan of using debt to assets ratios as a measure of leverage. They do not take into account a company's earnings power and require at least a rough idea of the value of a company's assets. Such ratios are problematic when calculated for balance sheets with a high percentage of goodwill or an inventory position prone to markdowns (see my article on Target Corporation (TGT)). I acknowledge that the ratio provides an indication of how conservatively or aggressively a company is financed, but there are several other ratios that serve the same purpose and provide additional insight. In closing, I personally do not pay much attention to debt to assets ratios.</p> <h2>Debt To Equity</h2> <p>The debt to equity ratio is another leverage ratio that is similarly easy to calculate as the debt to assets ratio, but in its pure form only requires data from the right side of the balance sheet (total debt divided by total equity). As above, several definitions exist. An investor may choose to deduct cash and cash equivalents if they represent a significant percentage of total assets and are not needed for day-to-day operations. Of course, it is not always easy to determine the true percentage of excess cash.</p> <p>The ratio may be \"simpler\" in that it requires only inputs from the right side of the balance sheet, but that makes an investor potentially prone to ignoring the asset base. Recall Figure 2 - an investor looking only at the liability side of the balance sheet may be lulled into a false sense of security by the 50% equity funding.</p> <p>This is especially relevant when looking at banks' balance sheets. Regulators require banks to hold a certain amount of equity relative to their so-called risk-weighted assets (RWA, see this article for a \"simple\" approach based on internal ratings - IRB approach). Looking at a bank's equity ratio or debt to equity ratio can be extremely misleading, as the unfortunate example of Silicon Valley Bank (OTCPK:SIVBQ) has taught us (see my explanation and outlook on banks). Other banks' assets have also come under increased scrutiny, particularly those with a large amount of equity at risk of being eroded by large unrealized losses in their investment portfolios. Truist Financial Corporation (TFC) and <a href=\"https://laohu8.com/S/USBOV\">U.S. Bancorp</a> (USB) are two particularly notable examples, as they had unrealized losses of $8.8 billion and $9.6 billion, respectively, in their held-to-maturity portfolios at the end of the first quarter of 2023. While the theoretical impact on their respective equity is certainly significant and potentially devastating (Figure 3), I still consider the two stocks speculative buys and have recently added them to my portfolio.</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862300327339408.png\"/></span><figcaption><p>Figure 3: Truist Financial Corporation [TFC] vs. U.S. Bancorp [USB]: Comparison of debt to equity ratios before and after hypothetical realization of the losses in their held-to-maturity portfolios (own work, based on the companies' 2023 first quarter 10-Qs).</p></figcaption></figure></p> <p>However, a high leverage ratio is not necessarily an indication of problems. Such static ratios do not take into account a company's <em>cash</em> earnings power and can therefore lead to false positives. A good example is Philip Morris International Inc. (PM), which aggressively bought back shares after its spin-off from Altria Group Inc. (MO) in 2008 and whose debt to equity ratio therefore actually turned negative in 2012 (Figure 4). Even though PMI's debt to equity and debt to assets ratios have looked pretty scary since 2012, I would argue that the company can easily manage its negative equity thanks to its very stable earnings and cash flow, as well as its notorious profitability as a major tobacco company.</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862302132049923.png\"/></span><figcaption><p>Figure 4: Philip Morris International Inc. [PM]: Debt to assets and debt to equity ratio since the spin-off from Altria Group, Inc. [MO] (own work, based on the company's 2009 to 2022 10-Ks)</p></figcaption></figure></p> <p>The buybacks have significantly improved PMI's earnings per share, but I would not go so far as to conclude that management bought back stock to boost otherwise poor earnings. There are other companies, such as Kimberly-Clark Corporation (KMB), that I am confident have bought back stock to prop up earnings and cash flow per share. As I discussed in another article, KMB's free cash flow has been treading water since at least 2010, but has increased by more than 22% when share repurchases are taken into account.</p> <p>In summary, the debt to equity ratio is very easy to calculate, but its usefulness is limited. It provides a quick view of how aggressively a company is financed. Like the debt to assets ratio, this metric should only be used to compare companies in a particular industry. A high debt to equity ratio indicates that a company may be over-reliant on debt, while a low ratio suggests that management may be too conservative and not using debt appropriately to expand (as a reminder, equity is always more expensive than debt). An increase in the debt to equity ratio over time due to:</p> <ul> <li>impairment of goodwill and other intangible assets,</li> <li>accelerated depreciation and amortization of fixed assets and other assets,</li> <li>incurring debt to fund unpromising projects,</li> <li>or incurring debt to aggressively repurchase shares to boost earnings per share.</li> </ul> <p>... may indicate a deterioration in fundamentals. However, a high debt to equity ratio does not necessarily signal problems, as the example of Philip Morris International Inc. showed. As will be discussed below, I believe it is very important to consider a company's cash earnings power when assessing the manageability of its debt.</p> <h2>Debt To EBITDA</h2> <p>The ratio of debt to earnings before interest, taxes, depreciation and amortization (EBITDA) provides a dynamic view of the debt of a company. While the above ratios are useful for a quick peer group comparison and for identifying potentially problematic trends, they do not allow a conclusion to be drawn about the sustainability of the debt. Before we take a closer look at the ratio, a word of caution. EBITDA is often referred to as a cash flow metric. I won't go into detail about why this is problematic, and I think it suffices to quote the comments of Warren Buffett and Charlie Munger in the 2000 annual report of Berkshire Hathaway Inc. (BRK.A, BRK.B):</p> <blockquote> <p><em>\"Investors are often led astray by CEOs and Wall Street analysts who equate depreciation charges with the amortization charges we have just discussed. In no way are the two the same: With rare exceptions, depreciation is an economic cost every bit as real as wages, materials, or taxes. Certainly that is true at Berkshire and at virtually all the other businesses we have studied. Furthermore, we do not think so-called EBITDA (earnings before interest, taxes, depreciation and amortization) is a meaningful measure of performance. Managements that dismiss the importance of depreciation - and emphasize \"cash flow\" or EBITDA - are apt to make faulty decisions, and you should keep that in mind as you make your own investment decisions.</em>\"</p> <p>Page 65, 2000 annual report, Berkshire Hathaway Inc.</p> </blockquote> <p>The debt to EBITDA ratio typically relates all interest-bearing debt to EBITDA. It is critical to make a meaningful estimate of EBITDA, and investors should be wary of one-time charges or tailwinds. I usually look at the three-year average of EBITDA, but of course, that doesn't help with companies that are growing aggressively or are in decline. It's a very descriptive metric because it shows the number of years it theoretically takes a company to pay down its debt. Of course, this is where the problems start, because I have yet to come across a company that does not have to make regular investments and pay taxes and interest.</p> <p>Suffice it to say, I don't like to use the debt to EBITDA ratio because of these serious flaws and only use it for companies that don't have actual free cash flow, such as utilities. In a nutshell, the debt to EBITDA ratio assumes an indefinite life of the company's assets. I acknowledge that the investments of these companies tend to be very long-lived, but they eventually depreciate, so I remain very cautious about utility debt in general, and especially in the current high interest rate environment.</p> <p>Take the example of The Southern Company (SO), a utility I have reported on in the past. Metrics such as net financial debt to assets and net financial debt to equity are not helpful in this context:</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-1686231258402452.png\"/></span><figcaption><p>Figure 5: The Southern Company [SO]: Net financial debt to assets and net financial debt to equity ratio since 2017 (own work, based on the company's 2017 to 2022 10-Ks)</p></figcaption></figure></p> <p>If one takes into account (adjusted) EBITDA as a proxy for earnings, things look different. Of course, one could argue that the substantial capital expenditures associated with the construction of Vogtle Units 3 and 4 will result in higher earnings later on and that the cost overruns are one-time in nature, but I would argue that there is always a way to make debt metrics look good. However, even using EBITDA before \"special items,\" it is clear that Southern's debt only knows one direction. In 2012, net financial debt was 3.0 times adjusted EBITDA, and by 2022 it had increased to 5.6 times.</p> <p>Although this all sounds very negative and perhaps implies that the debt to EBITDA ratio is a more or less useless metric, investors should still keep an eye on the ratio, as many creditors have formulated debt covenants based on this ratio. Not only can they directly impact a company's access to sources of liquidity, but a breach of debt covenants can quickly lead to a dividend cut or other unpleasant management decisions.</p> <p>In this regard, diversified manufacturer Leggett &amp; Platt, Inc. (LEG) serves as a good example. Due to the cyclical nature of its earnings, management acted prudently in 2020 and agreed with its creditors to modify some of the debt covenants. For example, the debt covenant associated with LEG's revolving credit facility was changed from gross debt to net debt in May 2020 and again in September 2021, to 3.5 times net debt to EBITDA from 2.5 times previously (p. 94, 2021 10-K), creating more headroom for short-term liquidity needs. Figure 6 shows the evolution of Leggett's leverage since the first quarter of 2020. Those who have followed my articles on the company know that free cash flow fell off a cliff in 2021, underscoring the usefulness of adjusted EBITDA in the context of debt covenants, as it is less sensitive to short-term fluctuations than actual free cash flow.</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862316960432389.png\"/></span><figcaption><p>Figure 6: Leggett &amp; Platt, Inc. [LEG]: Net financial debt to trailing 12-month adjusted EBITDA since 2020 (own work, based on the company's quarterly earnings releases)</p></figcaption></figure></p> <h2>Debt To Free Cash Flow</h2> <p>My regular readers know that I place great emphasis on free cash flow. As an income-oriented investor, I need to ensure that the companies I own generate enough cash to fund their operations, grow, and pay a (growing) dividend. I acknowledge that a meaningful estimate of the debt to free cash flow ratio requires a bit of work. For one, the analyst must be wary of seemingly non-cash costs (e.g., stock-based compensation and related share repurchases to offset dilution). It is also important to have a good understanding of working capital movements, especially for companies with high working capital needs and/or those operating in cyclical industries. Those interested in calculating debt relative to free cash flow themselves should read this article detailing my adjustments to conventional free cash flow.</p> <p>Putting (interest-bearing) debt in relation to free cash flow gives a similar illustrative number to the ratio of debt to EBITDA. One can subtract regular expenses such as dividends to shareholders to arrive at a more conservative estimate of a company's leverage. The debt to free cash flow ratio is definitely my preferred leverage metric, in combination with the interest coverage ratio (see below).</p> <p>It is impossible to make a recommendation for an appropriate debt to free cash flow ratio. Companies with reliable cash flows and low capital expenditures, such as tobacco companies or IT companies with robust subscription models such as Microsoft Corporation (MSFT), can obviously handle much higher leverage ratios than cyclical industrial companies such as <a href=\"https://laohu8.com/S/MMM\">3M</a> Company (MMM). In this context, it is of course interesting to note that Microsoft is extremely conservatively financed (Figure 7) despite its highly reliable cash flows, while 3M's leverage is becoming more of a problem, in part due to high expected settlement charges and declining cash flows from operations - which is attributable to increasing competition, its cyclicality, and operational inefficiencies.</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-1686231972653794.png\"/></span><figcaption><p>Figure 7: Microsoft Corporation [MSFT]: Gross and net financial debt to normalized free cash flow; note that Microsoft's negative net debt to nFCF ratio indicates that the company has a net cash position on its balance sheet (own work, based on the company's fiscal 2016 to fiscal 2022 10-Ks)</p></figcaption></figure></p> <p>In principle, I consider a leverage ratio of up to four times net debt to free cash flow to be unproblematic, even for rather cyclical companies. Of course, an increase in this ratio over the years should be appropriately questioned, as it could indicate earnings problems or other challenges. It is also important to consider working capital. The post-pandemic period showed us how quickly cash flow can evaporate when, for example, supplies get stuck in transit or parts needed for completion are unavailable.</p> <p>Finally, if a company's management is fairly conservative and maintains a low (or even negative) net debt to free cash flow ratio, I take that into account in my valuation. I am willing to pay a premium for companies with reliable free cash flow and low debt. Besides Microsoft, names like The Procter &amp; Gamble Company (PG) come to mind. Under pressure from activist investor Nelson Peltz, the portfolio has been streamlined, debt repayment has been accelerated through divestitures, and cost-cutting measures have helped to significantly improve profitability. As a result, PG's net debt is now about 1.4 to 1.8 times the normalized free cash flow. And even after paying dividends, the company would only need three to four years to pay off all its interest-bearing financial liabilities.</p> <h2>Interest Coverage Ratio</h2> <p>This is my second go-to metric when assessing a company's leverage. According to many textbooks, the interest coverage ratio is obtained by dividing a company's net operating profit after taxes (NOPAT) by the net interest expense incurred. Again, it is important that the data be meaningful (e.g., use two- or three-year averages). In its foundation, the ratio is easy to calculate and very descriptive. The higher it is, the better, as the company only has to spend a comparatively small percentage of its operating profit on interest payments.</p> <p>As always, the devil is in the details. For example, it can be dangerous to take net interest expense at face value. While a company with a substantial cash position may offset some of its interest expense with interest income from short-term investments, this income is sensitive to fluctuations in interest rates, while the weighted-average interest rate on the company's total debt adjusts relatively slowly. In this context, I find it extremely helpful to consider the debt maturity profile, also calculating the weighted-average interest rate on debt maturing over a given period. In my recent article on The Home Depot, Inc. and Lowe's Companies, Inc. (LOW), I discussed several important implications of interest rates, noting, for example, that HD is likely to face higher interest expense due to the comparatively low interest rate on its debt maturing in the next few years:</p> <p><figure contenteditable=\"false\"><span><img contenteditable=\"true\" loading=\"lazy\" src=\"https://static.seekingalpha.com/uploads/2023/6/8/49694823-16862323874477353.png\"/></span><figcaption><p>Figure 8: The Home Depot, Inc. [HD]: Long-term debt maturities as of year-end 2022 (own work, based on the company's 2022 10-K)</p></figcaption></figure></p> <p>In the context of interest rates, it is very important to look for potential debt with adjustable rates. Organon &amp; Co. (OGN), the women's health-focused spin-off from Merck &amp; Co. (MRK) that I recently reported on, is a good example. At the end of the second quarter of 2022, management expected interest expense to be $400 million, and although the company voluntarily repaid $250 million of its long-term debt in the first quarter of 2023, interest expense in 2023 is expected to be $515 million.</p> <p>Since earnings are relatively easy to manage, I prefer to calculate interest coverage using normalized free cash flow before interest. I realize that adding net interest expense to free cash flow is not entirely accurate, as it does not take into account the tax shield effect of interest expense, but it is a sufficient proxy in my opinion. An interest coverage ratio of six times free cash flow before interest is perfectly acceptable, and I am willing to pay a premium for a company whose interest coverage ratio is well above the peer group average.</p> <p>Finally, I think it can be worthwhile to do scenario analyses. The year 2022 has taught us that we should not be fooled by the apparent \"new normal\" of a zero interest rate environment. Investors who made sure their companies could withstand a high interest rate environment before interest rates rose could gracefully avoid companies with a problematic capital structure. At the same time, calculating the interest coverage ratio under stress scenarios can also help in the context of a potential rating downgrade, which is usually associated with an increase in the company's cost of capital. In this article, I have explained a simple approach to performing such calculations that can be easily implemented in Excel or a similar spreadsheet program.</p> <h2>A Few Final Words Of Caution</h2> <p>The interest coverage ratio and the debt to free cash flow ratio are the two ratios I use most often when evaluating a company's debt. They require a little work, but they provide a very transparent and easy-to-understand view of the situation. Debt due diligence doesn't end there, however, and I'd like to end the article with two final words of caution.</p> <p>Operating leases have historically not been recognized on the balance sheet. However, leases can be significant, especially for retailers, and the associated contractual payments can become problematic in an economic downturn or when company-specific issues arise. Beginning in 2019, operating leases must be recognized on the balance sheet (ASC 842 and IFRS 16), so it has become more difficult to overlook this item. There are several ways to account for operating leases. I personally account for them by calculating a modified version of the debt to free cash flow ratio. In this context, it is important to only compare members of a representative peer group.</p> <p>Second, pension-related obligations may also be considered more or less sensitive to interest rates. In particular, \"old economy\" companies with rather conventional compensation models may have significant unfunded pension-related obligations on their balance sheets. I discussed Lockheed Martin Corporation's (LMT) pension obligations in another article, noting positively that the company has transferred a significant portion of the obligations to retirement services companies such as <a href=\"https://laohu8.com/S/ATH\">Athene Holding Ltd</a>. (ATH.PB, ATH.PC, ATH.PD), thereby taking pressure off its own balance sheet.</p> <h2>Conclusion</h2> <p>The article provided an overview of several more or less common ratios that can be used to assess a company's leverage.</p> <p>Ratios such as debt to assets (debt to capital) or debt to equity, with all their nuances, are easy to determine and can provide an initial indication of a company's vulnerability in an economic downturn or point to inefficiencies due to inappropriate use of debt. However, because they are static ratios, they provide only a very limited picture, so it is important to review the evolution of these ratios over several years. The debt to equity ratio is very easy to obtain, as the asset side of the balance sheet can be ignored. However, this puts the analyst at risk of overlooking assets that are susceptible to write-downs, which directly impact equity and, therefore, loss absorption capacity. The asset side of the balance sheet should be critically examined, and this is particularly true for banks or companies with a high proportion of goodwill and other intangible assets.</p> <p>However, as the example of Philip Morris International and The Southern Company has shown, these ratios can produce misleading results. In the first case, investors may be unjustifiably alarmed, while in the second case, a potential deterioration in the company's fundamentals may be overlooked.</p> <p>Dynamic metrics such as debt to EBITDA or debt to free cash flow provide better insight into the situation. However, since EBITDA is not a true earnings metric (all companies have to pay taxes, make regular investments, and pay more or less interest), investors should be cautious when comparing debt to EBITDA. Nevertheless, this ratio is important in the context of debt covenants and should therefore be reviewed on a regular basis, especially for cyclical companies and/or companies at risk of short-term liquidity issues. Debt covenants also often directly impact a company's ability to pay dividends.</p> <p>My favorite metrics are the debt to free cash flow ratio and the interest coverage ratio. Using actual cash earnings instead of reported earnings elegantly avoids several pitfalls and can provide a fairly transparent view of a company's debt servicing ability. Consideration of the debt maturity profile allows identification of a potential near-term increase in interest expense, and proper analysis of free cash flow volatility (particularly in terms of working capital movements) allows an informed conclusion about a company's debt servicing ability in any economic climate.</p> <p>However, debt due diligence does not end with an examination of a company's interest-bearing debt. It is important to also consider more or less sector-specific obligations such as operating leases and pension obligations. Analysis should always be limited to a specific peer group. It makes no sense to compare the leverage of a retailer with high operating leases with that of a company with low assets such as a tobacco company or an asset manager. Similarly, it makes no sense to lament the high leverage of bank balance sheets and compare them to those of non-financial companies.</p> <p>Finally, it is important to always compare debt and interest expense to balance sheet or earnings ratios. It makes no sense to avoid a company because of its seemingly high debt in absolute terms. At times, news outlets indulge in sensational reports that a company has racked up tens of billions of dollars in debt, without putting the number into proper perspective.</p> <p>Also, investors need to be careful when comparing debt metrics from different data providers. There are a number of definitions, and it is important to know what actually went into the calculation. Sometimes data providers' calculations are opaque, or the necessary information is difficult to obtain.</p> <div></div> <p>As always, please consider this article only as a first step in your own due diligence. Thank you for taking the time to read my latest article. Whether you agree or disagree with my conclusions, I always welcome your opinion and feedback in the comments below. And if there is anything I should improve or expand on in future articles, drop me a line as well.</p></body></html>","source":"seekingalpha","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Debt Metrics: How To Interpret Them And When They Matter</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nDebt Metrics: How To Interpret Them And When They Matter\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-06-09 00:39 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4610322-debt-metrics-how-to-interpret><strong>seekingalpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>artoleshko/iStock via Getty Images Introduction Coming out of the pandemic, the Federal Reserve raised interest rates at an unprecedented pace. Over the course of about 15 months, the federal funds ...</p>\n\n<a href=\"https://seekingalpha.com/article/4610322-debt-metrics-how-to-interpret\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"https://static.seekingalpha.com/cdn/s3/uploads/getty_images/899096598/image_899096598.jpg","relate_stocks":{"BK4075":"烟草","LU0011850046.USD":"贝莱德全球长线股票 A2 USD","BK4576":"AR","IE00BWXC8680.SGD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A5\" (SGD) ACC","LU0061474705.USD":"THREADNEEDLE (LUX) GLOBAL DYNAMIC REAL RETURN \"AU\" (USD) ACC","BK4558":"双十一","BK4206":"工业集团企业","KMB":"金佰利","BK4559":"巴菲特持仓","BK4538":"云计算","SG9999015358.SGD":"United Income Focus Trust Dis SGD-H","IE00BFSS8Q28.SGD":"Janus Henderson Balanced A Inc SGD-H","IE0034235188.USD":"PINEBRIDGE GLOBAL FOCUS EQUITY \"A\" (USD) ACC","LU1267930490.SGD":"TEMPLETON GLOBAL EQUITY INCOME \"AS\" (SGD) INC A","BK4588":"碎股","LU1244550577.SGD":"FTIF - Franklin Global Multi-Asset Income A (Mdis) SGD-H1","BK4550":"红杉资本持仓","BK4503":"景林资产持仓","LU0738911758.USD":"Blackrock Global Equity Income A6 USD","SG9999014542.SGD":"United Income Focus Trust Acc SGD","BK4589":"SVB概念","LU0211331839.USD":"FRANKLIN MUTUAL GLB DISCOVERY \"A\" (USD) ACC","MRK":"默沙东","LU0289739343.SGD":"SUSTAINABLE GLOBAL THEMATIC PORTFOLIO \"A\" (SGD) ACC","BK4097":"系统软件","BK4581":"高盛持仓","IE00BFSS7M15.SGD":"Janus Henderson Balanced A Acc SGD-H","SG9999001176.SGD":"UOB UNITED GLOBAL HEALTHCARE \"SGD\" (ACC)","LU0238689110.USD":"贝莱德环球动力股票基金","IE0004445239.USD":"JANUS HENDERSON US FORTY \"A2\" (USD) ACC","LU0053666078.USD":"摩根大通基金-美国股票A（离岸）美元","LEG":"礼恩派","IE0009355771.USD":"骏利亨德森环球生命科技A Acc","LU0079474960.USD":"联博美国增长基金A","IE0009356076.USD":"JANUS HENDERSON GLOBAL TECHNOLOGY AND INNOVATION \"A2\" (USD) ACC","LOW":"劳氏","LU1093756325.SGD":"FTIF - Franklin K2 Alt Strat Fd A (acc) SGD-H1","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC","IE00BKVL7J92.USD":"Legg Mason ClearBridge - US Equity Sustainability Leaders A Acc USD","IE00B2B36J28.USD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"I1\" (USD) INC","SG9999011175.SGD":"Nikko AM Global Dividend Equity Dis SGD-H","IE00BJT1NW94.SGD":"JANUS HENDERSON GLOBAL LIFE SCIENCES \"A2\" (SGDHDG) ACC","LU0234572021.USD":"高盛美国核心股票组合Acc","IE00BSNM7G36.USD":"NEUBERGER BERMAN SYSTEMATIC GLOBAL SUSTAINABLE VALUE \"A\" (USD) ACC","SO":"美国南方公司","LU0158827948.USD":"ALLIANZ GLOBAL SUSTAINABILITY \"A\" (USD) INC","LU0320765646.SGD":"FTIF - Franklin Income A MDIS SGD-H1","LU2237438978.USD":"Amundi Funds US Pioneer A2 (C) USD","KHC":"卡夫亨氏","IE00BZ1G4Q59.USD":"LEGG MASON CLEARBRIDGE US EQUITY SUSTAINABILITY LEADER \"A\"(USD) INC (A)"},"source_url":"https://seekingalpha.com/article/4610322-debt-metrics-how-to-interpret","is_english":true,"share_image_url":"https://static.laohu8.com/5a36db9d73b4222bc376d24ccc48c8a4","article_id":"2342211315","content_text":"artoleshko/iStock via Getty Images Introduction Coming out of the pandemic, the Federal Reserve raised interest rates at an unprecedented pace. Over the course of about 15 months, the federal funds rate was raised to 5.25%, a level not seen since the Great Recession. What was unthinkable three years ago is now a reality, and it increasingly looks as if the days of \"easy money\" are finally over. Companies are facing a higher cost of capital, which puts them at risk especially those who succumbed to the siren songs and took on excessive debt. Debt is not a bad thing per se, but with extremely low interest rates, malinvestments are increasingly common. Companies are being acquired at ridiculous valuations (e.g., V.F. Corp. (VFC) purchased fashion label Supreme for 3.7 times sales), shares are being bought back at all-time highs (e.g., The Home Depot, Inc. (HD) bought back $14.8 billion worth of stock at an average price of $388), and some companies would quickly cease to exist without a steady infusion of capital. I've probably looked at more than 100 companies in the last two years and rarely have I seen one that hasn't increased its debt to a more or less significant degree. On the surface, this looks like a pretty bad setup in an environment where interest rates are likely to remain high for a significant period of time. The devil is in the details, and it is important to take a close look at a company's debt using a number of metrics. However, some of the more or less commonly available ratios can easily be misinterpreted, leading to false positives or, probably worse, false negatives. In this article, I will discuss the most common leverage ratios - how they are defined, when they should be used, and when they can produce misleading results. Don't worry, no mathematical equations are used, and in fact, my preferred metrics can be explained in a sentence or two and provide illustrative results. Debt To Assets, Debt To Capital This is a straightforward ratio that puts debt in relation to a company's total assets, and is sometimes also referred to as the gearing ratio. \"Debt\" refers to all of a company's liabilities, such as interest-bearing debt and other liabilities, but definitions vary. Sometimes only funded debt is considered. In general, subtracting equity from total assets yields the most conservative version of the ratio because it implicitly takes into account all liabilities. The debt to capital ratio can be viewed as a variant of the debt to assets ratio, since \"capital\" includes both debt and equity. However, investors should be careful not to compare debt to asset or debt to capital ratios from different sources, and it is important to know what is included in debt and capital. In my view, given the simplicity of the approach, investors should take the time to look at the balance sheet and calculate the ratios themselves or stick with a single source. In general, a low debt to assets ratio indicates conservative management because a relatively high proportion of assets are financed by equity (Figure 1), which has no contractual right to interest payments, making the company more financially robust in a downturn. All other things being equal, a company with a low debt to assets ratio has a high loss-absorbing capacity (see below). A ratio greater than 1 means that a company has more liabilities than assets and is typically very inflexible in an economic downturn and increasingly at the mercy of its creditors (i.e., an increased risk of insolvency). Figure 1: Comparison of a balance sheet with a low debt to assets ratio (left) and a high debt to assets ratio (right) (own work) Conversely, the higher the debt to assets ratio, the lower the loss absorption capacity and the higher the theoretical probability that there will not be enough left over to satisfy the claims of suppliers, pensioners, bondholders, shareholders and other stakeholders in the event of bankruptcy. This, of course, raises the question of the actual value of a company's assets in the event of bankruptcy - a question that is difficult (impossible?) to answer ex ante. While I acknowledge that most investors look at a company on a going concern basis and therefore do not necessarily have to know the \"true\" value of the assets, it is still important to watch for a potentially inflated asset base. Take, for example, a company that grows through acquisitions, assuming goodwill (the premium paid in addition to the value of the assets) in the process. If a company at some point in the future determines that the fair value of the acquired cash-generating unit is less than its carrying amount, the goodwill (and possibly other intangible assets) is impaired. This reduces the assets and affects the company's equity, resulting in an increase in the debt to assets ratio (Figure 2). Figure 2: Schematic representation of the decrease in equity when a company recognizes a goodwill impairment charge (own work) Common sense tells us that companies whose assets consist of a high percentage of goodwill may need to recognize impairment charges at some point. Kraft Heinz Co (KHC), for example, had a debt to assets ratio of 45% at the end of 2017. 37% of assets consisted of goodwill and 50% consisted of other intangible assets (e.g., trademarks). In 2018, KHC incurred impairment charges of $7.0 billion and $8.9 billion on goodwill and other intangible assets, respectively. The company did not incur any additional debt in 2018, so impairment charges were the primary reason for the 500 basis point increase in KHC's debt to assets ratio. All in all, I'm not a big fan of using debt to assets ratios as a measure of leverage. They do not take into account a company's earnings power and require at least a rough idea of the value of a company's assets. Such ratios are problematic when calculated for balance sheets with a high percentage of goodwill or an inventory position prone to markdowns (see my article on Target Corporation (TGT)). I acknowledge that the ratio provides an indication of how conservatively or aggressively a company is financed, but there are several other ratios that serve the same purpose and provide additional insight. In closing, I personally do not pay much attention to debt to assets ratios. Debt To Equity The debt to equity ratio is another leverage ratio that is similarly easy to calculate as the debt to assets ratio, but in its pure form only requires data from the right side of the balance sheet (total debt divided by total equity). As above, several definitions exist. An investor may choose to deduct cash and cash equivalents if they represent a significant percentage of total assets and are not needed for day-to-day operations. Of course, it is not always easy to determine the true percentage of excess cash. The ratio may be \"simpler\" in that it requires only inputs from the right side of the balance sheet, but that makes an investor potentially prone to ignoring the asset base. Recall Figure 2 - an investor looking only at the liability side of the balance sheet may be lulled into a false sense of security by the 50% equity funding. This is especially relevant when looking at banks' balance sheets. Regulators require banks to hold a certain amount of equity relative to their so-called risk-weighted assets (RWA, see this article for a \"simple\" approach based on internal ratings - IRB approach). Looking at a bank's equity ratio or debt to equity ratio can be extremely misleading, as the unfortunate example of Silicon Valley Bank (OTCPK:SIVBQ) has taught us (see my explanation and outlook on banks). Other banks' assets have also come under increased scrutiny, particularly those with a large amount of equity at risk of being eroded by large unrealized losses in their investment portfolios. Truist Financial Corporation (TFC) and U.S. Bancorp (USB) are two particularly notable examples, as they had unrealized losses of $8.8 billion and $9.6 billion, respectively, in their held-to-maturity portfolios at the end of the first quarter of 2023. While the theoretical impact on their respective equity is certainly significant and potentially devastating (Figure 3), I still consider the two stocks speculative buys and have recently added them to my portfolio. Figure 3: Truist Financial Corporation [TFC] vs. U.S. Bancorp [USB]: Comparison of debt to equity ratios before and after hypothetical realization of the losses in their held-to-maturity portfolios (own work, based on the companies' 2023 first quarter 10-Qs). However, a high leverage ratio is not necessarily an indication of problems. Such static ratios do not take into account a company's cash earnings power and can therefore lead to false positives. A good example is Philip Morris International Inc. (PM), which aggressively bought back shares after its spin-off from Altria Group Inc. (MO) in 2008 and whose debt to equity ratio therefore actually turned negative in 2012 (Figure 4). Even though PMI's debt to equity and debt to assets ratios have looked pretty scary since 2012, I would argue that the company can easily manage its negative equity thanks to its very stable earnings and cash flow, as well as its notorious profitability as a major tobacco company. Figure 4: Philip Morris International Inc. [PM]: Debt to assets and debt to equity ratio since the spin-off from Altria Group, Inc. [MO] (own work, based on the company's 2009 to 2022 10-Ks) The buybacks have significantly improved PMI's earnings per share, but I would not go so far as to conclude that management bought back stock to boost otherwise poor earnings. There are other companies, such as Kimberly-Clark Corporation (KMB), that I am confident have bought back stock to prop up earnings and cash flow per share. As I discussed in another article, KMB's free cash flow has been treading water since at least 2010, but has increased by more than 22% when share repurchases are taken into account. In summary, the debt to equity ratio is very easy to calculate, but its usefulness is limited. It provides a quick view of how aggressively a company is financed. Like the debt to assets ratio, this metric should only be used to compare companies in a particular industry. A high debt to equity ratio indicates that a company may be over-reliant on debt, while a low ratio suggests that management may be too conservative and not using debt appropriately to expand (as a reminder, equity is always more expensive than debt). An increase in the debt to equity ratio over time due to:  impairment of goodwill and other intangible assets, accelerated depreciation and amortization of fixed assets and other assets, incurring debt to fund unpromising projects, or incurring debt to aggressively repurchase shares to boost earnings per share.  ... may indicate a deterioration in fundamentals. However, a high debt to equity ratio does not necessarily signal problems, as the example of Philip Morris International Inc. showed. As will be discussed below, I believe it is very important to consider a company's cash earnings power when assessing the manageability of its debt. Debt To EBITDA The ratio of debt to earnings before interest, taxes, depreciation and amortization (EBITDA) provides a dynamic view of the debt of a company. While the above ratios are useful for a quick peer group comparison and for identifying potentially problematic trends, they do not allow a conclusion to be drawn about the sustainability of the debt. Before we take a closer look at the ratio, a word of caution. EBITDA is often referred to as a cash flow metric. I won't go into detail about why this is problematic, and I think it suffices to quote the comments of Warren Buffett and Charlie Munger in the 2000 annual report of Berkshire Hathaway Inc. (BRK.A, BRK.B):  \"Investors are often led astray by CEOs and Wall Street analysts who equate depreciation charges with the amortization charges we have just discussed. In no way are the two the same: With rare exceptions, depreciation is an economic cost every bit as real as wages, materials, or taxes. Certainly that is true at Berkshire and at virtually all the other businesses we have studied. Furthermore, we do not think so-called EBITDA (earnings before interest, taxes, depreciation and amortization) is a meaningful measure of performance. Managements that dismiss the importance of depreciation - and emphasize \"cash flow\" or EBITDA - are apt to make faulty decisions, and you should keep that in mind as you make your own investment decisions.\" Page 65, 2000 annual report, Berkshire Hathaway Inc.  The debt to EBITDA ratio typically relates all interest-bearing debt to EBITDA. It is critical to make a meaningful estimate of EBITDA, and investors should be wary of one-time charges or tailwinds. I usually look at the three-year average of EBITDA, but of course, that doesn't help with companies that are growing aggressively or are in decline. It's a very descriptive metric because it shows the number of years it theoretically takes a company to pay down its debt. Of course, this is where the problems start, because I have yet to come across a company that does not have to make regular investments and pay taxes and interest. Suffice it to say, I don't like to use the debt to EBITDA ratio because of these serious flaws and only use it for companies that don't have actual free cash flow, such as utilities. In a nutshell, the debt to EBITDA ratio assumes an indefinite life of the company's assets. I acknowledge that the investments of these companies tend to be very long-lived, but they eventually depreciate, so I remain very cautious about utility debt in general, and especially in the current high interest rate environment. Take the example of The Southern Company (SO), a utility I have reported on in the past. Metrics such as net financial debt to assets and net financial debt to equity are not helpful in this context: Figure 5: The Southern Company [SO]: Net financial debt to assets and net financial debt to equity ratio since 2017 (own work, based on the company's 2017 to 2022 10-Ks) If one takes into account (adjusted) EBITDA as a proxy for earnings, things look different. Of course, one could argue that the substantial capital expenditures associated with the construction of Vogtle Units 3 and 4 will result in higher earnings later on and that the cost overruns are one-time in nature, but I would argue that there is always a way to make debt metrics look good. However, even using EBITDA before \"special items,\" it is clear that Southern's debt only knows one direction. In 2012, net financial debt was 3.0 times adjusted EBITDA, and by 2022 it had increased to 5.6 times. Although this all sounds very negative and perhaps implies that the debt to EBITDA ratio is a more or less useless metric, investors should still keep an eye on the ratio, as many creditors have formulated debt covenants based on this ratio. Not only can they directly impact a company's access to sources of liquidity, but a breach of debt covenants can quickly lead to a dividend cut or other unpleasant management decisions. In this regard, diversified manufacturer Leggett & Platt, Inc. (LEG) serves as a good example. Due to the cyclical nature of its earnings, management acted prudently in 2020 and agreed with its creditors to modify some of the debt covenants. For example, the debt covenant associated with LEG's revolving credit facility was changed from gross debt to net debt in May 2020 and again in September 2021, to 3.5 times net debt to EBITDA from 2.5 times previously (p. 94, 2021 10-K), creating more headroom for short-term liquidity needs. Figure 6 shows the evolution of Leggett's leverage since the first quarter of 2020. Those who have followed my articles on the company know that free cash flow fell off a cliff in 2021, underscoring the usefulness of adjusted EBITDA in the context of debt covenants, as it is less sensitive to short-term fluctuations than actual free cash flow. Figure 6: Leggett & Platt, Inc. [LEG]: Net financial debt to trailing 12-month adjusted EBITDA since 2020 (own work, based on the company's quarterly earnings releases) Debt To Free Cash Flow My regular readers know that I place great emphasis on free cash flow. As an income-oriented investor, I need to ensure that the companies I own generate enough cash to fund their operations, grow, and pay a (growing) dividend. I acknowledge that a meaningful estimate of the debt to free cash flow ratio requires a bit of work. For one, the analyst must be wary of seemingly non-cash costs (e.g., stock-based compensation and related share repurchases to offset dilution). It is also important to have a good understanding of working capital movements, especially for companies with high working capital needs and/or those operating in cyclical industries. Those interested in calculating debt relative to free cash flow themselves should read this article detailing my adjustments to conventional free cash flow. Putting (interest-bearing) debt in relation to free cash flow gives a similar illustrative number to the ratio of debt to EBITDA. One can subtract regular expenses such as dividends to shareholders to arrive at a more conservative estimate of a company's leverage. The debt to free cash flow ratio is definitely my preferred leverage metric, in combination with the interest coverage ratio (see below). It is impossible to make a recommendation for an appropriate debt to free cash flow ratio. Companies with reliable cash flows and low capital expenditures, such as tobacco companies or IT companies with robust subscription models such as Microsoft Corporation (MSFT), can obviously handle much higher leverage ratios than cyclical industrial companies such as 3M Company (MMM). In this context, it is of course interesting to note that Microsoft is extremely conservatively financed (Figure 7) despite its highly reliable cash flows, while 3M's leverage is becoming more of a problem, in part due to high expected settlement charges and declining cash flows from operations - which is attributable to increasing competition, its cyclicality, and operational inefficiencies. Figure 7: Microsoft Corporation [MSFT]: Gross and net financial debt to normalized free cash flow; note that Microsoft's negative net debt to nFCF ratio indicates that the company has a net cash position on its balance sheet (own work, based on the company's fiscal 2016 to fiscal 2022 10-Ks) In principle, I consider a leverage ratio of up to four times net debt to free cash flow to be unproblematic, even for rather cyclical companies. Of course, an increase in this ratio over the years should be appropriately questioned, as it could indicate earnings problems or other challenges. It is also important to consider working capital. The post-pandemic period showed us how quickly cash flow can evaporate when, for example, supplies get stuck in transit or parts needed for completion are unavailable. Finally, if a company's management is fairly conservative and maintains a low (or even negative) net debt to free cash flow ratio, I take that into account in my valuation. I am willing to pay a premium for companies with reliable free cash flow and low debt. Besides Microsoft, names like The Procter & Gamble Company (PG) come to mind. Under pressure from activist investor Nelson Peltz, the portfolio has been streamlined, debt repayment has been accelerated through divestitures, and cost-cutting measures have helped to significantly improve profitability. As a result, PG's net debt is now about 1.4 to 1.8 times the normalized free cash flow. And even after paying dividends, the company would only need three to four years to pay off all its interest-bearing financial liabilities. Interest Coverage Ratio This is my second go-to metric when assessing a company's leverage. According to many textbooks, the interest coverage ratio is obtained by dividing a company's net operating profit after taxes (NOPAT) by the net interest expense incurred. Again, it is important that the data be meaningful (e.g., use two- or three-year averages). In its foundation, the ratio is easy to calculate and very descriptive. The higher it is, the better, as the company only has to spend a comparatively small percentage of its operating profit on interest payments. As always, the devil is in the details. For example, it can be dangerous to take net interest expense at face value. While a company with a substantial cash position may offset some of its interest expense with interest income from short-term investments, this income is sensitive to fluctuations in interest rates, while the weighted-average interest rate on the company's total debt adjusts relatively slowly. In this context, I find it extremely helpful to consider the debt maturity profile, also calculating the weighted-average interest rate on debt maturing over a given period. In my recent article on The Home Depot, Inc. and Lowe's Companies, Inc. (LOW), I discussed several important implications of interest rates, noting, for example, that HD is likely to face higher interest expense due to the comparatively low interest rate on its debt maturing in the next few years: Figure 8: The Home Depot, Inc. [HD]: Long-term debt maturities as of year-end 2022 (own work, based on the company's 2022 10-K) In the context of interest rates, it is very important to look for potential debt with adjustable rates. Organon & Co. (OGN), the women's health-focused spin-off from Merck & Co. (MRK) that I recently reported on, is a good example. At the end of the second quarter of 2022, management expected interest expense to be $400 million, and although the company voluntarily repaid $250 million of its long-term debt in the first quarter of 2023, interest expense in 2023 is expected to be $515 million. Since earnings are relatively easy to manage, I prefer to calculate interest coverage using normalized free cash flow before interest. I realize that adding net interest expense to free cash flow is not entirely accurate, as it does not take into account the tax shield effect of interest expense, but it is a sufficient proxy in my opinion. An interest coverage ratio of six times free cash flow before interest is perfectly acceptable, and I am willing to pay a premium for a company whose interest coverage ratio is well above the peer group average. Finally, I think it can be worthwhile to do scenario analyses. The year 2022 has taught us that we should not be fooled by the apparent \"new normal\" of a zero interest rate environment. Investors who made sure their companies could withstand a high interest rate environment before interest rates rose could gracefully avoid companies with a problematic capital structure. At the same time, calculating the interest coverage ratio under stress scenarios can also help in the context of a potential rating downgrade, which is usually associated with an increase in the company's cost of capital. In this article, I have explained a simple approach to performing such calculations that can be easily implemented in Excel or a similar spreadsheet program. A Few Final Words Of Caution The interest coverage ratio and the debt to free cash flow ratio are the two ratios I use most often when evaluating a company's debt. They require a little work, but they provide a very transparent and easy-to-understand view of the situation. Debt due diligence doesn't end there, however, and I'd like to end the article with two final words of caution. Operating leases have historically not been recognized on the balance sheet. However, leases can be significant, especially for retailers, and the associated contractual payments can become problematic in an economic downturn or when company-specific issues arise. Beginning in 2019, operating leases must be recognized on the balance sheet (ASC 842 and IFRS 16), so it has become more difficult to overlook this item. There are several ways to account for operating leases. I personally account for them by calculating a modified version of the debt to free cash flow ratio. In this context, it is important to only compare members of a representative peer group. Second, pension-related obligations may also be considered more or less sensitive to interest rates. In particular, \"old economy\" companies with rather conventional compensation models may have significant unfunded pension-related obligations on their balance sheets. I discussed Lockheed Martin Corporation's (LMT) pension obligations in another article, noting positively that the company has transferred a significant portion of the obligations to retirement services companies such as Athene Holding Ltd. (ATH.PB, ATH.PC, ATH.PD), thereby taking pressure off its own balance sheet. Conclusion The article provided an overview of several more or less common ratios that can be used to assess a company's leverage. Ratios such as debt to assets (debt to capital) or debt to equity, with all their nuances, are easy to determine and can provide an initial indication of a company's vulnerability in an economic downturn or point to inefficiencies due to inappropriate use of debt. However, because they are static ratios, they provide only a very limited picture, so it is important to review the evolution of these ratios over several years. The debt to equity ratio is very easy to obtain, as the asset side of the balance sheet can be ignored. However, this puts the analyst at risk of overlooking assets that are susceptible to write-downs, which directly impact equity and, therefore, loss absorption capacity. The asset side of the balance sheet should be critically examined, and this is particularly true for banks or companies with a high proportion of goodwill and other intangible assets. However, as the example of Philip Morris International and The Southern Company has shown, these ratios can produce misleading results. In the first case, investors may be unjustifiably alarmed, while in the second case, a potential deterioration in the company's fundamentals may be overlooked. Dynamic metrics such as debt to EBITDA or debt to free cash flow provide better insight into the situation. However, since EBITDA is not a true earnings metric (all companies have to pay taxes, make regular investments, and pay more or less interest), investors should be cautious when comparing debt to EBITDA. Nevertheless, this ratio is important in the context of debt covenants and should therefore be reviewed on a regular basis, especially for cyclical companies and/or companies at risk of short-term liquidity issues. Debt covenants also often directly impact a company's ability to pay dividends. My favorite metrics are the debt to free cash flow ratio and the interest coverage ratio. Using actual cash earnings instead of reported earnings elegantly avoids several pitfalls and can provide a fairly transparent view of a company's debt servicing ability. Consideration of the debt maturity profile allows identification of a potential near-term increase in interest expense, and proper analysis of free cash flow volatility (particularly in terms of working capital movements) allows an informed conclusion about a company's debt servicing ability in any economic climate. However, debt due diligence does not end with an examination of a company's interest-bearing debt. It is important to also consider more or less sector-specific obligations such as operating leases and pension obligations. Analysis should always be limited to a specific peer group. It makes no sense to compare the leverage of a retailer with high operating leases with that of a company with low assets such as a tobacco company or an asset manager. Similarly, it makes no sense to lament the high leverage of bank balance sheets and compare them to those of non-financial companies. Finally, it is important to always compare debt and interest expense to balance sheet or earnings ratios. It makes no sense to avoid a company because of its seemingly high debt in absolute terms. At times, news outlets indulge in sensational reports that a company has racked up tens of billions of dollars in debt, without putting the number into proper perspective. Also, investors need to be careful when comparing debt metrics from different data providers. There are a number of definitions, and it is important to know what actually went into the calculation. Sometimes data providers' calculations are opaque, or the necessary information is difficult to obtain.  As always, please consider this article only as a first step in your own due diligence. Thank you for taking the time to read my latest article. Whether you agree or disagree with my conclusions, I always welcome your opinion and feedback in the comments below. And if there is anything I should improve or expand on in future articles, drop me a line as well.","news_type":1},"isVote":1,"tweetType":1,"viewCount":238,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9970200669,"gmtCreate":1684425784051,"gmtModify":1684425787625,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Makes sense...","listText":"Makes sense...","text":"Makes sense...","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9970200669","repostId":"9970624756","repostType":1,"repost":{"id":9970624756,"gmtCreate":1684409317976,"gmtModify":1684409616631,"author":{"id":"3570103090255456","authorId":"3570103090255456","name":"JC888","avatar":"https://community-static.tradeup.com/news/f3e3c0218599fca5c4e265ddbee1fb32","crmLevel":4,"crmLevelSwitch":1},"themes":[],"title":"Top 3 Stocks To Exit In A US Debit Limit Meltdown.","htmlText":"It was a “pleasant” surprise to wake in the morning to find that US market has staged a 1-day rally where gains were quite “substantial”. As mentioned in my <a href=\"https://ttm.financial/post/9970892786\" target=\"_blank\">Tue, 16 May post</a>’s opening paragrahs, “pointless” to celebrate because market will struggle thru this week, in a “confused” state. See what I mean? US market’s futures for Thu, 18 May is a “red” wash all over again. Without a national issue eg. Debt Limit, the US market is already “unpredictable” at times; let alone with one now, the US market is going to get even crazier. While trying to play the devil’s advocate on the US Debt Limit issue, I stumbled upon the article by The Council of Economic Advisors (CEA) on the economic impact based on different degrees of Debt","listText":"It was a “pleasant” surprise to wake in the morning to find that US market has staged a 1-day rally where gains were quite “substantial”. As mentioned in my <a href=\"https://ttm.financial/post/9970892786\" target=\"_blank\">Tue, 16 May post</a>’s opening paragrahs, “pointless” to celebrate because market will struggle thru this week, in a “confused” state. See what I mean? US market’s futures for Thu, 18 May is a “red” wash all over again. Without a national issue eg. Debt Limit, the US market is already “unpredictable” at times; let alone with one now, the US market is going to get even crazier. While trying to play the devil’s advocate on the US Debt Limit issue, I stumbled upon the article by The Council of Economic Advisors (CEA) on the economic impact based on different degrees of Debt","text":"It was a “pleasant” surprise to wake in the morning to find that US market has staged a 1-day rally where gains were quite “substantial”. As mentioned in my Tue, 16 May post’s opening paragrahs, “pointless” to celebrate because market will struggle thru this week, in a “confused” state. See what I mean? US market’s futures for Thu, 18 May is a “red” wash all over again. Without a national issue eg. Debt Limit, the US market is already “unpredictable” at times; let alone with one now, the US market is going to get even crazier. While trying to play the devil’s advocate on the US Debt Limit issue, I stumbled upon the article by The Council of Economic Advisors (CEA) on the economic impact based on different degrees of Debt","images":[{"img":"https://community-static.tradeup.com/news/582be0e3a7ad364f73ddd8810fd117bd","width":"1176","height":"274"},{"img":"https://community-static.tradeup.com/news/94a9fc0f6b4032fd20e5b43a823ad910","width":"1162","height":"40"},{"img":"https://community-static.tradeup.com/news/441a150fd7800a440ba2caa444933128","width":"1109","height":"329"}],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9970624756","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":10,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":233,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9941728052,"gmtCreate":1680600805477,"gmtModify":1680600810483,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Be careful....","listText":"Be careful....","text":"Be careful....","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":1,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9941728052","repostId":"2324996847","repostType":2,"repost":{"id":"2324996847","pubTimestamp":1680585300,"share":"https://www.laohu8.com/m/news/2324996847?lang=&edition=full","pubTime":"2023-04-04 13:15","market":"us","language":"en","title":"JPMorgan’s Kolanovic Warns Stocks Are in \"Calm Before the Storm\"","url":"https://stock-news.laohu8.com/highlight/detail?id=2324996847","media":"Bloomberg","summary":"Past two weeks of inflows driven by short squeeze, fall in VIXEquities likely to ‘retest last year’s","content":"<html><head></head><body><ul><li><p>Past two weeks of inflows driven by short squeeze, fall in VIX</p></li><li><p>Equities likely to ‘retest last year’s low,’ Kolanovic says</p></li></ul><p>A risk-on mood fueling this year’s equities rally is likely to falter, with headwinds from bank turbulence, an oil shock and slowing growth poised to send stocks back toward their 2022 lows, according to JPMorgan strategist Marko Kolanovic.</p><p style=\"text-align: start;\">“The Fed indicated no intention to cut interest rates this year, yet risk assets are exhibiting an unprecedented rally, with European stocks trading near all-time highs and US stocks recovering recent losses,” Kolanovic wrote in a note to clients Monday. “We expect a reversal in risk sentiment and the market retesting last year’s low over the coming months.”</p><p style=\"text-align: start;\">Stocks have remained resilient this year despite rising interest rates that have dented corporate profits, slowed growth and triggered a series of bank collapses in the US and overseas. The benchmark S&amp;P 500 rose 7% in the first quarter after dropping nearly 20% in 2022, while gains across technology stocks have pushed the Nasdaq 100 up 20% since the start of January and into a bull market.</p><p style=\"text-align: start;\">Tech’s outperformance has become even more magnified recently as traders ramp up bets that banking-system stresses will prompt the Federal Reserve to hit the brakes on its tightening campaign.</p><p style=\"text-align: start;\">But in Kolanovic’s view, the inflows into stocks over the past few weeks “make little sense” and were largely driven by systemic investors, a short squeeze and a decline in the Cboe Volatility Index, or VIX. </p><p>A drop in the VIX below 20, a level associated with less stressful periods, suggests investors believe the banking crisis is contained in the near term. However, Kolanovic characterizes the present market backdrop as “the calm before the storm.” </p><p style=\"text-align: start;\">“It is worth noting the accordion-like nature of risk sentiment, where restrictive rates produced an issue for various carry trades and the ensuing pullback in yields mitigated some of the stress,” Kolanovic wrote. “Although central banks are still communicating, there is ground to cover on fighting inflation and pushing back against the market’s assumption of cuts, so the original source of stress, rates higher for longer, can reenter the picture.”</p></body></html>","source":"lsy1584095487587","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>JPMorgan’s Kolanovic Warns Stocks Are in \"Calm Before the Storm\"</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nJPMorgan’s Kolanovic Warns Stocks Are in \"Calm Before the Storm\"\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-04-04 13:15 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.bloomberg.com/news/articles/2023-04-03/jpmorgan-s-kolanovic-warns-stocks-are-in-calm-before-the-storm?srnd=markets-vp><strong>Bloomberg</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Past two weeks of inflows driven by short squeeze, fall in VIXEquities likely to ‘retest last year’s low,’ Kolanovic saysA risk-on mood fueling this year’s equities rally is likely to falter, with ...</p>\n\n<a href=\"https://www.bloomberg.com/news/articles/2023-04-03/jpmorgan-s-kolanovic-warns-stocks-are-in-calm-before-the-storm?srnd=markets-vp\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"IE00B1BXHZ80.USD":"Legg Mason ClearBridge - US Appreciation A Acc USD","LU1244550221.USD":"FRANKLIN GLOBAL MULTI-ASSET  INCOME \"A\" (USDHEDGED) INC (M)","BK4550":"红杉资本持仓","LU0971096721.USD":"富达环球金融服务 A","LU1244550577.SGD":"FTIF - Franklin Global Multi-Asset Income A (Mdis) SGD-H1","LU0976567544.SGD":"FTIF - Templeton Global Income A Mdis SGD-H1","LU0149725797.USD":"汇丰美国股市经济规模基金","BK4534":"瑞士信贷持仓","LU1267930490.SGD":"TEMPLETON GLOBAL EQUITY INCOME \"AS\" (SGD) INC A","IE0034235188.USD":"PINEBRIDGE GLOBAL FOCUS EQUITY \"A\" (USD) ACC","LU0211326839.USD":"TEMPLETON GLOBAL INCOME \"A\" (USD) INC","BK4504":"桥水持仓","LU0211327993.USD":"TEMPLETON GLOBAL EQUITY INCOME \"A\" (USD) ACC","LU0882574139.USD":"富达环球消费行业基金A ACC","BK4533":"AQR资本管理(全球第二大对冲基金)","LU1668664300.SGD":"Blackrock World Financials A2 SGD-H","BK4581":"高盛持仓","LU1244550494.USD":"FRANKLIN GLOBAL MULTI-ASSET INCOME \"A\" (USDHEDGED) ACC","LU0256863811.USD":"ALLIANZ US EQUITY \"A\" INC","BK4207":"综合性银行","LU1496350171.SGD":"FRANKLIN DIVERSIFIED BALANCED \"A\" (SGDHDG) ACC","LU0211328371.USD":"TEMPLETON GLOBAL EQUITY INCOME \"A\" (MDIS) (USD)   INC","LU1496350502.SGD":"FRANKLIN DIVERSIFIED DYNAMIC \"A\" (SGDHDG) ACC","LU0170899867.USD":"EASTSPRING INVESTMENTS WORLD VALUE EQUITY  \"A\" (USD) ACC","LU0417517546.SGD":"Allianz US Equity Cl AT Acc SGD",".DJI":"道琼斯","LU0208291251.USD":"FRANKLIN MUTUAL U.S. VALUE \"A\" (USD) INC",".IXIC":"NASDAQ Composite","LU1162221912.USD":"FRANKLIN INCOME \"A\" (USD) ACC","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC",".SPX":"S&P 500 Index","BK4585":"ETF&股票定投概念","LU1261432733.SGD":"Fidelity World A-ACC-SGD","BK4566":"资本集团","SG9999002232.USD":"Allianz Global High Payout USD","LU0310799852.SGD":"FTIF - Templeton Global Equity Income A MDIS SGD","LU0211326755.USD":"TEMPLETON GLOBAL INCOME \"A\" (USD) ACC","LU0320765646.SGD":"FTIF - Franklin Income A MDIS SGD-H1","SG9999002224.SGD":"Allianz Global High Payout SGD","LU1363072403.SGD":"Fidelity Global Financial Services A-ACC-SGD","LU0106831901.USD":"贝莱德世界金融基金A2","LU0320765489.SGD":"FTIF - Franklin Mutual US Value A Acc SGD","LU0496365809.HKD":"TEMPLETON GLOBAL INCOME \"A\" (HKD) INC (Q)","IE00BWXC8680.SGD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A5\" (SGD) ACC","LU0070302665.USD":"FRANKLIN MUTUAL U.S. VALUE \"A\" (USD) ACC","BK4588":"碎股"},"source_url":"https://www.bloomberg.com/news/articles/2023-04-03/jpmorgan-s-kolanovic-warns-stocks-are-in-calm-before-the-storm?srnd=markets-vp","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"2324996847","content_text":"Past two weeks of inflows driven by short squeeze, fall in VIXEquities likely to ‘retest last year’s low,’ Kolanovic saysA risk-on mood fueling this year’s equities rally is likely to falter, with headwinds from bank turbulence, an oil shock and slowing growth poised to send stocks back toward their 2022 lows, according to JPMorgan strategist Marko Kolanovic.“The Fed indicated no intention to cut interest rates this year, yet risk assets are exhibiting an unprecedented rally, with European stocks trading near all-time highs and US stocks recovering recent losses,” Kolanovic wrote in a note to clients Monday. “We expect a reversal in risk sentiment and the market retesting last year’s low over the coming months.”Stocks have remained resilient this year despite rising interest rates that have dented corporate profits, slowed growth and triggered a series of bank collapses in the US and overseas. The benchmark S&P 500 rose 7% in the first quarter after dropping nearly 20% in 2022, while gains across technology stocks have pushed the Nasdaq 100 up 20% since the start of January and into a bull market.Tech’s outperformance has become even more magnified recently as traders ramp up bets that banking-system stresses will prompt the Federal Reserve to hit the brakes on its tightening campaign.But in Kolanovic’s view, the inflows into stocks over the past few weeks “make little sense” and were largely driven by systemic investors, a short squeeze and a decline in the Cboe Volatility Index, or VIX. A drop in the VIX below 20, a level associated with less stressful periods, suggests investors believe the banking crisis is contained in the near term. However, Kolanovic characterizes the present market backdrop as “the calm before the storm.” “It is worth noting the accordion-like nature of risk sentiment, where restrictive rates produced an issue for various carry trades and the ensuing pullback in yields mitigated some of the stress,” Kolanovic wrote. “Although central banks are still communicating, there is ground to cover on fighting inflation and pushing back against the market’s assumption of cuts, so the original source of stress, rates higher for longer, can reenter the picture.”","news_type":1},"isVote":1,"tweetType":1,"viewCount":293,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9941558021,"gmtCreate":1680484886664,"gmtModify":1680484888419,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Name to remember - Manan Gosalia","listText":"Name to remember - Manan Gosalia","text":"Name to remember - Manan Gosalia","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9941558021","repostId":"1184542811","repostType":2,"repost":{"id":"1184542811","pubTimestamp":1680396356,"share":"https://www.laohu8.com/m/news/1184542811?lang=&edition=full","pubTime":"2023-04-02 08:45","market":"us","language":"en","title":"SVB’s Fall Stunned Even the One Stock Analyst Who Said to Sell","url":"https://stock-news.laohu8.com/highlight/detail?id=1184542811","media":"Bloomberg","summary":"Morgan Stanley’s Gosalia was only one with sell rating on SVBHalf of Wall Street analysts had buy ra","content":"<html><head></head><body><ul><li><p>Morgan Stanley’s Gosalia was only one with sell rating on SVB</p></li><li><p>Half of Wall Street analysts had buy ratings up until the end</p></li></ul><p>Morgan Stanley’s Manan Gosalia saw risks gathering over Silicon Valley Bank as tech startups burned through cash.</p><p style=\"text-align: start;\">So in early December, he issued a warning: It was time to cut exposure to shares of SVB Financial Group, the bank’s parent company. He would remain a lone bearish voice among Wall Street analysts. </p><p style=\"text-align: start;\">Only days before a panic drove Silicon Valley Bank into a collapse in less than 48 hours, banking analysts remained widely optimistic about the company. Half of the two dozen who tracked it were still advising investors to buy the stock, according to data compiled by Bloomberg. One forecast the share price would nearly double to $500 in a year. Even some who saw the toxic mix that would later sink the bank stuck to their hold ratings — a neutral stance that amounts to sitting on the sidelines.</p><p style=\"text-align: start;\">In short, just like regulators and investors, they were caught off-guard by a Twitter-age bank run that shook global markets, shining a spotlight on a thorny issue that Wall Street has wrestled with for decades: The almost unfailingly rosy analysis produced by many of its research divisions. </p><p>Yet even Gosalia was shocked by how quickly Silicon Valley Bank became biggest bank failure since 2008. “No one expected the pace at which this happened,” he said.</p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/98c7328efe0c53a7a601cdf61585faf3\" tg-width=\"977\" tg-height=\"646\"/></p><p></p><p>In retrospect, though, the warning signs seem clear. A deposit base concentrated in a boom-and-bust industry. Rising interest rates. And massive bond holdings hit by the worst losses in decades. All it took was a catalyst to rattle the faith of its fleet-footed customers.</p><p style=\"text-align: start;\">Still, those risks weren’t enough to prompt calls to sell from Wall Street analysts, who saw a lucrative franchise in Silicon Valley Bank’s status as the tech industry’s go-to lender. Its share price more than doubled in the two years through 2021, tracking a rally in growth stocks as the Federal Reserve flooded the markets with cash. </p><p></p><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ffd0b2076275c5eaa5da8845b418e545\" tg-width=\"979\" tg-height=\"554\"/></p><p></p><p>In July, when the stock dropped on disappointing earnings, Michael Diana, an analyst with Maxim Group, told investors to buy the dip. “Here is the chance to buy the most unique/best-positioned bank for 2023 and the longer-term,” he wrote in a note to clients. </p><p style=\"text-align: start;\">Diana remained Wall Street’s biggest bull, with a $500 price target on the stock right before the bank’s demise. He didn’t pull his buy rating until Silicon Valley Bank was taken over by the Federal Deposit Insurance Corp. on March 10. Diana declined to comment.</p><p style=\"text-align: start;\">Chris Kotowski at Oppenheimer said he wishes he had cut SVB all the way to a sell, instead of just to hold. In a January note to clients, he said the bank’s securities holdings would “be like a stone anchor.” But, like nearly a dozen others, he kept a hold rating on the stock, stopping short of advising investors to get out. He said the debacle has been a lesson in the risk of investing in banks whose fates are tied too closely to a narrow base of clients. </p><p style=\"text-align: start;\">“There’s all these venture-capital funded companies that have $5, $10, $20, $25, sometimes hundreds of millions of dollars parked with this little bank,” he said. “And you can move money with the click of a mouse now. And then they’re all talking to one another. So in retrospect, it’s like yeah, should have seen that one coming more easily.” </p><p>In early October, Morgan Stanley’s Gosalia downgraded SVB to equal-weight, the equivalent of a hold, anticipating that the downturn in venture-capital funding would linger. At the time, he said the bank had enough liquidity to cover deposit outflows and that venture-capital funding had the potential to “accelerate significantly” once the economic outlook turned.</p><p style=\"text-align: start;\">Later that month, the stock slipped further after SVB dialed back its forecast for net-interest income — a key metric — while assuring that its underlying business was strong.</p><p>Gosalia had doubts. In early December, he and his colleagues said they expected SVB to remain under pressure as venture—capital companies burned through funds.</p><p style=\"text-align: start;\">Those concerns finally prompted Gosalia to downgrade SVB to underweight, the equivalent of a sell. But he saw broader industry troubles from rising funding costs, too: He dropped Signature Bank to equal-weight and cut two others — Silvergate Capital Corp. and First Republic Bank — to underweight. The first two went on to fail; First Republic’s shares tumbled nearly 90% in March on worries about its solvency.</p><p style=\"text-align: start;\">While SVB’s shares rallied earlier this year as the company’s guidance supported a more optimistic outlook, Gosalia held firm. The rating, he said by email, was based on anticipation that “ongoing pressure on VC deployment and cash burn would weigh on the bank’s net interest income, and that the pain was not over.”</p><p style=\"text-align: start;\">The collapse began on the evening of March 8, when SVB said it planned to raise more than $2 billion of additional capital after unloading its available-for-sale securities at a loss. That snowballed into a meltdown in hours. </p><p style=\"text-align: start;\">On March 10, the bank was taken over by the FDIC, and First Citizens BancShares Inc. has since agreed to buy Silicon Valley Bank. SVB was delisted from the Nasdaq stock exchange with a last closing price of $106. When it started trading on the over-the-counter market in late March, it hit as little as 1 cent. </p><p style=\"text-align: start;\">The fears that undid Silicon Valley Bank have since shifted to other lenders, even with the pressures easing as US regulators take steps to restore faith in the industry. But Gosalia is mindful of what he said was a lesson of the last few weeks: “Things can change quickly in financial markets.”</p></body></html>","source":"lsy1584095487587","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>SVB’s Fall Stunned Even the One Stock Analyst Who Said to Sell</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nSVB’s Fall Stunned Even the One Stock Analyst Who Said to Sell\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-04-02 08:45 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.bloomberg.com/news/articles/2023-04-01/svb-s-fall-stunned-even-the-one-stock-analyst-who-said-to-sell?srnd=premium><strong>Bloomberg</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>Morgan Stanley’s Gosalia was only one with sell rating on SVBHalf of Wall Street analysts had buy ratings up until the endMorgan Stanley’s Manan Gosalia saw risks gathering over Silicon Valley Bank as...</p>\n\n<a href=\"https://www.bloomberg.com/news/articles/2023-04-01/svb-s-fall-stunned-even-the-one-stock-analyst-who-said-to-sell?srnd=premium\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"SIVBQ":"硅谷银行"},"source_url":"https://www.bloomberg.com/news/articles/2023-04-01/svb-s-fall-stunned-even-the-one-stock-analyst-who-said-to-sell?srnd=premium","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1184542811","content_text":"Morgan Stanley’s Gosalia was only one with sell rating on SVBHalf of Wall Street analysts had buy ratings up until the endMorgan Stanley’s Manan Gosalia saw risks gathering over Silicon Valley Bank as tech startups burned through cash.So in early December, he issued a warning: It was time to cut exposure to shares of SVB Financial Group, the bank’s parent company. He would remain a lone bearish voice among Wall Street analysts. Only days before a panic drove Silicon Valley Bank into a collapse in less than 48 hours, banking analysts remained widely optimistic about the company. Half of the two dozen who tracked it were still advising investors to buy the stock, according to data compiled by Bloomberg. One forecast the share price would nearly double to $500 in a year. Even some who saw the toxic mix that would later sink the bank stuck to their hold ratings — a neutral stance that amounts to sitting on the sidelines.In short, just like regulators and investors, they were caught off-guard by a Twitter-age bank run that shook global markets, shining a spotlight on a thorny issue that Wall Street has wrestled with for decades: The almost unfailingly rosy analysis produced by many of its research divisions. Yet even Gosalia was shocked by how quickly Silicon Valley Bank became biggest bank failure since 2008. “No one expected the pace at which this happened,” he said.In retrospect, though, the warning signs seem clear. A deposit base concentrated in a boom-and-bust industry. Rising interest rates. And massive bond holdings hit by the worst losses in decades. All it took was a catalyst to rattle the faith of its fleet-footed customers.Still, those risks weren’t enough to prompt calls to sell from Wall Street analysts, who saw a lucrative franchise in Silicon Valley Bank’s status as the tech industry’s go-to lender. Its share price more than doubled in the two years through 2021, tracking a rally in growth stocks as the Federal Reserve flooded the markets with cash. In July, when the stock dropped on disappointing earnings, Michael Diana, an analyst with Maxim Group, told investors to buy the dip. “Here is the chance to buy the most unique/best-positioned bank for 2023 and the longer-term,” he wrote in a note to clients. Diana remained Wall Street’s biggest bull, with a $500 price target on the stock right before the bank’s demise. He didn’t pull his buy rating until Silicon Valley Bank was taken over by the Federal Deposit Insurance Corp. on March 10. Diana declined to comment.Chris Kotowski at Oppenheimer said he wishes he had cut SVB all the way to a sell, instead of just to hold. In a January note to clients, he said the bank’s securities holdings would “be like a stone anchor.” But, like nearly a dozen others, he kept a hold rating on the stock, stopping short of advising investors to get out. He said the debacle has been a lesson in the risk of investing in banks whose fates are tied too closely to a narrow base of clients. “There’s all these venture-capital funded companies that have $5, $10, $20, $25, sometimes hundreds of millions of dollars parked with this little bank,” he said. “And you can move money with the click of a mouse now. And then they’re all talking to one another. So in retrospect, it’s like yeah, should have seen that one coming more easily.” In early October, Morgan Stanley’s Gosalia downgraded SVB to equal-weight, the equivalent of a hold, anticipating that the downturn in venture-capital funding would linger. At the time, he said the bank had enough liquidity to cover deposit outflows and that venture-capital funding had the potential to “accelerate significantly” once the economic outlook turned.Later that month, the stock slipped further after SVB dialed back its forecast for net-interest income — a key metric — while assuring that its underlying business was strong.Gosalia had doubts. In early December, he and his colleagues said they expected SVB to remain under pressure as venture—capital companies burned through funds.Those concerns finally prompted Gosalia to downgrade SVB to underweight, the equivalent of a sell. But he saw broader industry troubles from rising funding costs, too: He dropped Signature Bank to equal-weight and cut two others — Silvergate Capital Corp. and First Republic Bank — to underweight. The first two went on to fail; First Republic’s shares tumbled nearly 90% in March on worries about its solvency.While SVB’s shares rallied earlier this year as the company’s guidance supported a more optimistic outlook, Gosalia held firm. The rating, he said by email, was based on anticipation that “ongoing pressure on VC deployment and cash burn would weigh on the bank’s net interest income, and that the pain was not over.”The collapse began on the evening of March 8, when SVB said it planned to raise more than $2 billion of additional capital after unloading its available-for-sale securities at a loss. That snowballed into a meltdown in hours. On March 10, the bank was taken over by the FDIC, and First Citizens BancShares Inc. has since agreed to buy Silicon Valley Bank. SVB was delisted from the Nasdaq stock exchange with a last closing price of $106. When it started trading on the over-the-counter market in late March, it hit as little as 1 cent. The fears that undid Silicon Valley Bank have since shifted to other lenders, even with the pressures easing as US regulators take steps to restore faith in the industry. But Gosalia is mindful of what he said was a lesson of the last few weeks: “Things can change quickly in financial markets.”","news_type":1},"isVote":1,"tweetType":1,"viewCount":78,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9941551493,"gmtCreate":1680484861413,"gmtModify":1680484865047,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Name to remember -&nbsp;Manan Gosalia","listText":"Name to remember -&nbsp;Manan Gosalia","text":"Name to remember - Manan Gosalia","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9941551493","repostId":"1184542811","repostType":2,"isVote":1,"tweetType":1,"viewCount":77,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943892243,"gmtCreate":1679325275882,"gmtModify":1679325279824,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Interesting...","listText":"Interesting...","text":"Interesting...","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943892243","repostId":"9943344322","repostType":1,"repost":{"id":9943344322,"gmtCreate":1679195034667,"gmtModify":1679195420413,"author":{"id":"4098573842489750","authorId":"4098573842489750","name":"ToughCoyote","avatar":"https://static.tigerbbs.com/58563f63b7e52669e57762bb4ebee968","crmLevel":2,"crmLevelSwitch":0},"themes":[],"htmlText":"The People's Bank of China once again announced to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points, which is the same as the RRR cut in December last year. RMB 100 million, the weighted average deposit reserve ratio of financial institutions after the reduction is about 7.6%, this move is contrary to the Fed's interest rate hike situation, which causes the inversion of the evil interest to become larger and larger. In disguised investors, the funds of investors continue to stay in the investment of US bonds, bank fixed deposits and stock markets, which may once again affect the outflow of large foreign giants. situation.&nbsp; The reason for the domestic government's RRR cut is that the economic data is not as expected, and the year-on-year growth of r","listText":"The People's Bank of China once again announced to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points, which is the same as the RRR cut in December last year. RMB 100 million, the weighted average deposit reserve ratio of financial institutions after the reduction is about 7.6%, this move is contrary to the Fed's interest rate hike situation, which causes the inversion of the evil interest to become larger and larger. In disguised investors, the funds of investors continue to stay in the investment of US bonds, bank fixed deposits and stock markets, which may once again affect the outflow of large foreign giants. situation.&nbsp; The reason for the domestic government's RRR cut is that the economic data is not as expected, and the year-on-year growth of r","text":"The People's Bank of China once again announced to reduce the deposit reserve ratio of financial institutions by 0.25 percentage points, which is the same as the RRR cut in December last year. RMB 100 million, the weighted average deposit reserve ratio of financial institutions after the reduction is about 7.6%, this move is contrary to the Fed's interest rate hike situation, which causes the inversion of the evil interest to become larger and larger. In disguised investors, the funds of investors continue to stay in the investment of US bonds, bank fixed deposits and stock markets, which may once again affect the outflow of large foreign giants. situation. The reason for the domestic government's RRR cut is that the economic data is not as expected, and the year-on-year growth of r","images":[],"top":1,"highlighted":2,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943344322","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":133,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943892699,"gmtCreate":1679325233811,"gmtModify":1679325237327,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Good to know...","listText":"Good to know...","text":"Good to know...","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943892699","repostId":"9943069699","repostType":1,"repost":{"id":9943069699,"gmtCreate":1678969988011,"gmtModify":1678970042055,"author":{"id":"4102740236684050","authorId":"4102740236684050","name":"MaverickWealthBuilder","avatar":"https://community-static.tradeup.com/news/bbf0f514b8e5abb92266789b89f6e1e6","crmLevel":1,"crmLevelSwitch":0},"themes":[],"title":"How will Credit Suisse Crisis Affect Global Banks?","htmlText":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","listText":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","text":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","images":[],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943069699","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":78,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943892882,"gmtCreate":1679325163247,"gmtModify":1679325167072,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Alternatives..","listText":"Alternatives..","text":"Alternatives..","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943892882","repostId":"9949409979","repostType":1,"repost":{"id":9949409979,"gmtCreate":1678796237291,"gmtModify":1697535674342,"author":{"id":"3585780691540522","authorId":"3585780691540522","name":"FundMall","avatar":"https://static.laohu8.com/default-avatar.jpg","crmLevel":2,"crmLevelSwitch":0},"themes":[],"title":"Tiger Vault| A Good Alternative to Bank Deposits?","htmlText":"After&nbsp;the <a href=\"https://ttm.financial/post/9949547935\" target=\"_blank\">Silicon Valley Bank (SVB) Crash</a>, investors alike have rushed to withdraw their money from the U.S Banks in fear. If you, like these investors are worried about where to park your cash, we might just have the solution for you. Alternative to Bank Deposits Here at Tiger Brokers, <a href=\"https://www.tigerbrokers.com.sg/market/tiger-vault\" target=\"_blank\">Tiger Vault</a> is a cash management solution that provides investors yields of up to 4.54%* on their idle funds. You can select from mutual funds with relatively stable returns, low risk ratings, and high liquidity in the global markets. Is Tiger Vault impacted by the fall of SVB? The funds that we’ve handpicked to be part of Tiger Vault do not have any expo","listText":"After&nbsp;the <a href=\"https://ttm.financial/post/9949547935\" target=\"_blank\">Silicon Valley Bank (SVB) Crash</a>, investors alike have rushed to withdraw their money from the U.S Banks in fear. If you, like these investors are worried about where to park your cash, we might just have the solution for you. Alternative to Bank Deposits Here at Tiger Brokers, <a href=\"https://www.tigerbrokers.com.sg/market/tiger-vault\" target=\"_blank\">Tiger Vault</a> is a cash management solution that provides investors yields of up to 4.54%* on their idle funds. You can select from mutual funds with relatively stable returns, low risk ratings, and high liquidity in the global markets. Is Tiger Vault impacted by the fall of SVB? The funds that we’ve handpicked to be part of Tiger Vault do not have any expo","text":"After the Silicon Valley Bank (SVB) Crash, investors alike have rushed to withdraw their money from the U.S Banks in fear. If you, like these investors are worried about where to park your cash, we might just have the solution for you. Alternative to Bank Deposits Here at Tiger Brokers, Tiger Vault is a cash management solution that provides investors yields of up to 4.54%* on their idle funds. You can select from mutual funds with relatively stable returns, low risk ratings, and high liquidity in the global markets. Is Tiger Vault impacted by the fall of SVB? The funds that we’ve handpicked to be part of Tiger Vault do not have any expo","images":[{"img":"https://community-static.tradeup.com/news/6c1b766bdb425403abc7dd4587b15524","width":"542","height":"569"},{"img":"https://community-static.tradeup.com/news/6cefd16514d53fd06fc1492555fd4249","width":"225","height":"225"},{"img":"https://community-static.tradeup.com/news/dc7b1de23fcee2c9d2fc3e2379417d2a","width":"300","height":"168"}],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9949409979","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":4,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":135,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943892161,"gmtCreate":1679324974653,"gmtModify":1679324978681,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Great ariticle, would you like to share it?","listText":"Great ariticle, would you like to share it?","text":"Great ariticle, would you like to share it?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943892161","repostId":"9943069699","repostType":1,"repost":{"id":9943069699,"gmtCreate":1678969988011,"gmtModify":1678970042055,"author":{"id":"4102740236684050","authorId":"4102740236684050","name":"MaverickWealthBuilder","avatar":"https://community-static.tradeup.com/news/bbf0f514b8e5abb92266789b89f6e1e6","crmLevel":1,"crmLevelSwitch":0},"themes":[],"title":"How will Credit Suisse Crisis Affect Global Banks?","htmlText":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","listText":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","text":"What happened to Credit Suisse? On March 9, Credit Suisse announced that it had received technical inquiries from the SEC regarding its previously disclosed revisions to its consolidated cash flow statements for 2020 and 2019, and therefore delayed the release of its 2022 annual report. On March 14, Credit Suisse said it had identified “material weaknesses” in its internal controls over financial reporting for 2021 and 2022, and received an adverse opinion from its auditors. Credit Suisse’s share price fell by 24% on March 15, while its five-year CDS rose to nearly 1000, higher than Deutsche Bank’s crisis in 2016 and the eurozone debt crisis in 2013. This was mainly due to investor concerns about Credit Suisse and its potential adverse consequences. Credit default swaps (CDS) are credit ri","images":[],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943069699","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":213,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943896543,"gmtCreate":1679324905383,"gmtModify":1679324908863,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Great ariticle, would you like to share it?","listText":"Great ariticle, would you like to share it?","text":"Great ariticle, would you like to share it?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943896543","repostId":"9949254059","repostType":1,"repost":{"id":9949254059,"gmtCreate":1678711240472,"gmtModify":1678772009725,"author":{"id":"3501196737273098","authorId":"3501196737273098","name":"Tiger_comments","avatar":"https://community-static.tradeup.com/news/227887b200e9925968650d5db4a8bfb3","crmLevel":1,"crmLevelSwitch":0},"themes":[],"title":"Wanna Know| How to Draw & Use a Support/Resistance Line","htmlText":"Hi,&nbsp;tigers.&nbsp;On&nbsp;the&nbsp;most-concerned&nbsp;questions&nbsp;of&nbsp;how&nbsp;to&nbsp;decide&nbsp;when&nbsp;to&nbsp;buy&nbsp;and&nbsp;sell&nbsp;stocks,&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/U/4087786607644270\"></a><a href=\"https://ttm.financial/U/4087786607644270\">@Ron18</a> and&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/U/3570619054429964\"></a><a href=\"https://ttm.financial/U/3570619054429964\">@Evey77</a> asked&nbsp;me&nbsp;how&nbsp;to&nbsp;draw&nbsp;a&nbsp;support&nbsp;and&nbsp;resistance&nbsp;lines.&nbsp;This&nbsp;article&nbsp;gonna&nbsp;show&nbsp;you&nbsp;the&nbsp;easiest&nbsp;part&nbsp;in&nbsp;technical&nbsp;analysis&nbsp;-&nbsp;draw&nbsp;a&nbsp;support/resistance&nbsp;line.1.&nbsp;How to draw a support/resistance line?Support/resistance lines are h","listText":"Hi,&nbsp;tigers.&nbsp;On&nbsp;the&nbsp;most-concerned&nbsp;questions&nbsp;of&nbsp;how&nbsp;to&nbsp;decide&nbsp;when&nbsp;to&nbsp;buy&nbsp;and&nbsp;sell&nbsp;stocks,&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/U/4087786607644270\"></a><a href=\"https://ttm.financial/U/4087786607644270\">@Ron18</a> and&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/U/3570619054429964\"></a><a href=\"https://ttm.financial/U/3570619054429964\">@Evey77</a> asked&nbsp;me&nbsp;how&nbsp;to&nbsp;draw&nbsp;a&nbsp;support&nbsp;and&nbsp;resistance&nbsp;lines.&nbsp;This&nbsp;article&nbsp;gonna&nbsp;show&nbsp;you&nbsp;the&nbsp;easiest&nbsp;part&nbsp;in&nbsp;technical&nbsp;analysis&nbsp;-&nbsp;draw&nbsp;a&nbsp;support/resistance&nbsp;line.1.&nbsp;How to draw a support/resistance line?Support/resistance lines are h","text":"Hi, tigers. On the most-concerned questions of how to decide when to buy and sell stocks, @Ron18 and @Evey77 asked me how to draw a support and resistance lines. This article gonna show you the easiest part in technical analysis - draw a support/resistance line.1. How to draw a support/resistance line?Support/resistance lines are h","images":[{"img":"https://community-static.tradeup.com/news/52f03293898f7e07ed63358bc7e214b7","width":"-1","height":"-1"},{"img":"https://community-static.tradeup.com/news/f6b08740f2548b60389c56f436a3edca","width":"-1","height":"-1"},{"img":"https://community-static.tradeup.com/news/7c48a9dcc8d48e5d2d1efddafd0ed18d","width":"-1","height":"-1"}],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9949254059","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"subType":2,"comments":[],"imageCount":5,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":101,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943896641,"gmtCreate":1679324846784,"gmtModify":1679324850699,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Great ariticle, would you like to share it?","listText":"Great ariticle, would you like to share it?","text":"Great ariticle, would you like to share it?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943896641","repostId":"9943920139","repostType":1,"repost":{"id":9943920139,"gmtCreate":1679054414522,"gmtModify":1679055167379,"author":{"id":"3527667668165440","authorId":"3527667668165440","name":"Capital_Insights","avatar":"https://static.tigerbbs.com/cfdc66fff48bb2b9e2d328ac5eb33100","crmLevel":1,"crmLevelSwitch":0},"themes":[],"title":"Banking Crisis is Over? Impact to Economy & Central Banks","htmlText":"On Thursday, 11 U.S. banks led by <a target=\"_blank\" href=\"https://ttm.financial/S/JPM\">$JPMorgan Chase(JPM)$</a> , <a target=\"_blank\" href=\"https://ttm.financial/S/BAC\">$Bank of America(BAC)$</a> , and&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/S/C\">$Citigroup(C)$</a> banded together to inject $30 billion in uninsured deposits into stumbling lender <a target=\"_blank\" href=\"https://ttm.financial/S/FRC\">$First Republic Bank(FRC)$</a> .Fears of a global banking crisis have eased following the rollout of multi-billion-dollar lifelines for troubled lenders in Europe and the United States.&nbsp;Stocks rose in China, Japan, South Korea, Malaysia, Australia, the Philippines and Hong Kong on Friday:&nbsp;China’s blue-chip index gained 0.8%, while","listText":"On Thursday, 11 U.S. banks led by <a target=\"_blank\" href=\"https://ttm.financial/S/JPM\">$JPMorgan Chase(JPM)$</a> , <a target=\"_blank\" href=\"https://ttm.financial/S/BAC\">$Bank of America(BAC)$</a> , and&nbsp;<a target=\"_blank\" href=\"https://ttm.financial/S/C\">$Citigroup(C)$</a> banded together to inject $30 billion in uninsured deposits into stumbling lender <a target=\"_blank\" href=\"https://ttm.financial/S/FRC\">$First Republic Bank(FRC)$</a> .Fears of a global banking crisis have eased following the rollout of multi-billion-dollar lifelines for troubled lenders in Europe and the United States.&nbsp;Stocks rose in China, Japan, South Korea, Malaysia, Australia, the Philippines and Hong Kong on Friday:&nbsp;China’s blue-chip index gained 0.8%, while","text":"On Thursday, 11 U.S. banks led by $JPMorgan Chase(JPM)$ , $Bank of America(BAC)$ , and $Citigroup(C)$ banded together to inject $30 billion in uninsured deposits into stumbling lender $First Republic Bank(FRC)$ .Fears of a global banking crisis have eased following the rollout of multi-billion-dollar lifelines for troubled lenders in Europe and the United States. Stocks rose in China, Japan, South Korea, Malaysia, Australia, the Philippines and Hong Kong on Friday: China’s blue-chip index gained 0.8%, while","images":[{"img":"https://community-static.tradeup.com/news/0475db1ef70984e2477b560b4ab5c09e","width":"219","height":"230"}],"top":1,"highlighted":2,"essential":2,"paper":2,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943920139","isVote":1,"tweetType":1,"viewCount":0,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":1,"langContent":"EN","totalScore":0},"isVote":1,"tweetType":1,"viewCount":129,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9943896054,"gmtCreate":1679324659079,"gmtModify":1679324662659,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Great ariticle, would you like to share it?","listText":"Great ariticle, would you like to share it?","text":"Great ariticle, would you like to share it?","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9943896054","repostId":"2320450548","repostType":2,"isVote":1,"tweetType":1,"viewCount":101,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9954058209,"gmtCreate":1675865467402,"gmtModify":1675866329191,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Not true! https://tigr.link/HjFgZ","listText":"Not true! https://tigr.link/HjFgZ","text":"Not true! https://tigr.link/HjFgZ","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":0,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9954058209","repostId":"1123101999","repostType":2,"repost":{"id":"1123101999","weMediaInfo":{"introduction":"Providing stock market headlines, business news, financials and earnings ","home_visible":1,"media_name":"Tiger Newspress","id":"1079075236","head_image":"https://static.tigerbbs.com/8274c5b9d4c2852bfb1c4d6ce16c68ba"},"pubTimestamp":1675846906,"share":"https://www.laohu8.com/m/news/1123101999?lang=&edition=full","pubTime":"2023-02-08 17:01","market":"us","language":"en","title":"BBBY Rebounded Over 11% in Premarket Trading After Receiving $225 Million in Funding","url":"https://stock-news.laohu8.com/highlight/detail?id=1123101999","media":"Tiger Newspress","summary":"Bed Bath & Beyond rebounded over 11% in premarket trading after receiving $225 million in funding.It","content":"<html><head></head><body><p><a href=\"https://laohu8.com/S/BBBY\">Bed Bath &amp; Beyond</a> rebounded over 11% in premarket trading after receiving $225 million in funding.<img src=\"https://static.tigerbbs.com/f85b1afad823ed4daa6ae287cc2253fc\" tg-width=\"661\" tg-height=\"533\" width=\"100%\" height=\"auto\"/></p><p>It had raised about $225 million in an equity offering and that it was expecting to receive $800 million more in future installments, in a move that could help it stave off bankruptcy.</p></body></html>","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>BBBY Rebounded Over 11% in Premarket Trading After Receiving $225 Million in Funding</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nBBBY Rebounded Over 11% in Premarket Trading After Receiving $225 Million in Funding\n</h2>\n\n<h4 class=\"meta\">\n\n\n<a class=\"head\" href=\"https://laohu8.com/wemedia/1079075236\">\n\n\n<div class=\"h-thumb\" style=\"background-image:url(https://static.tigerbbs.com/8274c5b9d4c2852bfb1c4d6ce16c68ba);background-size:cover;\"></div>\n\n<div class=\"h-content\">\n<p class=\"h-name\">Tiger Newspress </p>\n<p class=\"h-time\">2023-02-08 17:01</p>\n</div>\n\n</a>\n\n\n</h4>\n\n</header>\n<article>\n<html><head></head><body><p><a href=\"https://laohu8.com/S/BBBY\">Bed Bath &amp; Beyond</a> rebounded over 11% in premarket trading after receiving $225 million in funding.<img src=\"https://static.tigerbbs.com/f85b1afad823ed4daa6ae287cc2253fc\" tg-width=\"661\" tg-height=\"533\" width=\"100%\" height=\"auto\"/></p><p>It had raised about $225 million in an equity offering and that it was expecting to receive $800 million more in future installments, in a move that could help it stave off bankruptcy.</p></body></html>\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"BBBY":"3B家居"},"source_url":"","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"1123101999","content_text":"Bed Bath & Beyond rebounded over 11% in premarket trading after receiving $225 million in funding.It had raised about $225 million in an equity offering and that it was expecting to receive $800 million more in future installments, in a move that could help it stave off bankruptcy.","news_type":1},"isVote":1,"tweetType":1,"viewCount":29,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0},{"id":9921249347,"gmtCreate":1671072772389,"gmtModify":1676538485513,"author":{"id":"4105324811361770","authorId":"4105324811361770","name":"DodoOne","avatar":"https://community-static.tradeup.com/news/cad27e45edc4c5fda582f35521fe85b5","crmLevel":5,"crmLevelSwitch":0},"themes":[],"htmlText":"Thanks for an interesting article","listText":"Thanks for an interesting article","text":"Thanks for an interesting article","images":[],"top":1,"highlighted":1,"essential":1,"paper":1,"likeSize":5,"commentSize":0,"repostSize":0,"link":"https://ttm.financial/post/9921249347","repostId":"2291571778","repostType":4,"repost":{"id":"2291571778","pubTimestamp":1671084084,"share":"https://www.laohu8.com/m/news/2291571778?lang=&edition=full","pubTime":"2022-12-15 14:01","market":"us","language":"en","title":"Tesla: I'd Buy After A 53.4% Drop","url":"https://stock-news.laohu8.com/highlight/detail?id=2291571778","media":"Seeking Alpha","summary":"SummaryTesla is a stock I'd be extra cautious about because its founder is involved in ever-more int","content":"<html><head></head><body><h2>Summary</h2><ul><li>Tesla is a stock I&#39;d be extra cautious about because its founder is involved in ever-more intense political controversies.</li><li>I&#39;ve covered it in past articles, getting fair value estimates near $250 on the assumption that the company keeps growing fairly quickly.</li><li>Nevertheless, I always rated it &#39;hold&#39; because I thought that the uncertainty surrounding the company undermined any thesis based on future growth assumptions.</li><li>In this article, I explain why I&#39;d buy Tesla at $75, a 53.4% drop, even though its financials and growth trajectory would seem to suggest it&#39;s worth more than that.</li></ul><p class=\"t-img-caption\"><img src=\"https://static.tigerbbs.com/ecebf7dbd139bf94cb13d4dce8d8da49\" tg-width=\"1080\" tg-height=\"704\" referrerpolicy=\"no-referrer\"/><span>Dimitrios Kambouris</span></p><p><b>Tesla</b>(NASDAQ:TSLA) is one of the toughest stocks out there to analyze. On the one hand, it has strong historical growth and adominant position in its market. On the other hand, it is veryexpensive (going by valuation multiples) and its founder is constantly getting in trouble for his provocative statements. In some cases, Musk has faced legal consequences for things he has said; for example, he once had to pay a $20 million fine for claiming that he had secured funding to take Tesla private.</p><p>This time around, Twitter is what’s getting people worried about their Tesla stock holdings. Elon Musk’s acquisition of Twitter was controversial in itself, now Elon musk is raising eyebrows for his posts on the platform. It would be hard to directly quote Musk’s recent posts without running afoul of Seeking Alpha’s political comment guidelines, so I will simply leave links to them off-platform here and here. Suffice it to say, the comments made some people very,<i>very</i> upset.</p><p>Shortly after Elon posted his two notorious Tweets, Tesla stock fell 6.3% in a single trading day. There was little material news about TSLA on the day that crash happened; the most recent big story was a bullish one about a surge in deliveries from Tesla Shanghai. Most likely, Musk’s tweets caused the selloff. Given the lack of other negative news, it’s the default assumption.</p><p>For me personally, nothing Musk is doing makes Tesla an “avoid at any price” stock. Tesla has great brand recognition, strong growth, and just recently got its tax credits back. The stock has a lot of things going for it. However, Musk’s risk taking is a serious enough concern for me to demand some kind of discount.</p><p>In past articles, I got fair value estimates for Tesla well above the current stock price. However, I never rated the stock any higher than a hold; in one article I rated it a sell. The reason for that is the immense uncertainty that Tesla is subject to. Whether it’s Musk’s Tweets or the federal investigation of the Twitter deal, there are many risk factors, some of which could impede the growth that makes the stock appear to have such a great future. For this reason, I’d want to see a price of $75 or lower before I’d buy the stock, even though I get value estimates above $200 when I value it by conventional means.</p><h2>My Past Coverage of Tesla</h2><p>In past articles, I’ve usually found Tesla to be worth something like $200-$300, going by a combination of multiples and discounted cash flows. In some cases, those prices were above the market price, but I never gave the stock a ‘buy’ rating, because I felt there were too many risks to the growth story. Some examples of valuations I arrived at include:</p><ul><li><p>$338 in “Tesla: the $4 Trillion Price Target is a Red Flag.”</p></li><li><p>$879 ($293 in post-split terms) in “Tesla: the EV Tax Credit is a Huge Catalyst.”</p></li><li><p>A sell rating (no specific price target) in “Long BYD, Short Tesla: a Great Tactical Pair Trade.”</p></li></ul><p>Now, you might wonder why I keep rating Tesla ‘hold’ or ‘sell’ when my models always give it upside. The reason has to do with how discounted cash flow models are constructed. You have to estimate future cash flows in order to make the math work, there’s no way around it. Tesla’s historical growth is extremely strong, and even if you cut the future growth estimates to half or a third of the actual historical growth, you still end up with pretty high price targets. In some of my previous articles, I cut Tesla’s future growth estimate down to the projected growth in the EV industry, which is a lot slower than Tesla’s actual growth rate. It still resulted in upside.</p><p>Still, I can’t rate the stock a buy, because I do think the risks here are serious enough to potentially end Tesla’s growth streak.</p><p>The first is demographics. Musk’s recent Twitter posts haven’t been received well by the demographics that tend to buy electric cars. Recently, Musk appeared on stage at a Dave Chapelle performance in San Francisco–the city with the second highest number of EV chargers in the U.S.--and was ‘booed’ by some audience members. This evidence might seem anecdotal, but it is known that Musk has low approval ratings in EV-friendly states like Oregon. Combining hard data with news reports, one gets the sense that Elon Musk isn’t being received well in States that are pushing green energy.</p><p>EV ownership in the U.S. skews toward affluent, educated, progressive-leaning individuals. Tesla has more conservative customers than other EV companies do, but it still has more democrat than republican owners. Many commentators believe that Musk’s recent Twitter posts have been designed to court conservative support. It is known that Musk is popular among conservatives, and he seems to be trying to shore up that support, but the problem is that Tesla’s customers come from other groups.</p><p>It’s not clear that Musk has angered enough people to get large numbers of them abandoning Tesla. A few people have said that they would buy Chevy Bolts in retaliation for Musk’s Twitter posts, but sales forecasts suggest there aren’t that many of them. By all accounts, Tesla’s sales are growing, not declining. Still, there is a possibility of Elon Musk alienating his core customer base; if he does so, we’d expect Tesla’s sales to take a hit.</p><p>There’s no shortage of companies selling electric cars. We’ve got European companies like <b>Volkswagen</b> (OTCPK:VWAGY), American companies like <b>General Motors</b> (GM) and Chinese companies like <b>NIO</b> (NIO) building EVs now. If the people who are upset about Musk’s job at Twitter wanted to ditch Tesla, they could do so. So a loss of sales is in principle a potential risk factor.</p><p>There’s also Musk’s selling of Twitter stock. As a long-term value investor, this does not really count as a risk to me, but it is a risk to those taking short term positions. Musk had to sell Tesla stock to put up collateral for the Twitter loans. He has sold at least $16.4 billion worth of TSLA, or 3.15% of the float. Insider selling of that magnitude can push a stock’s price downward, as stock prices are a function of supply and demand. If you don’t own Tesla stock now, and want to take a long-term position in the future, this is only good news, but for somebody who already owns Tesla stock, with no plans to average down, it’s very bad. If you already own Tesla and are hoping to get back to purchase prices well above $200, you might be waiting a while. Musk is rattling investor confidence and he may have more sales planned. If you don’t own Tesla stock, or own a little and plan on averaging down, then read on, because in the next section I explain why Tesla stock would be genuinely interesting at $75.</p><h2>Why Tesla Would Be Interesting at $75</h2><p>In previous sections, I explained why Tesla, with moderate growth assumptions, appeared to be worth $200 or more. In a DCF model it only takes about 20% growth in free cash flow for TSLA to come out with a fair value estimate well above $200. However, two things have to be kept in mind:</p><ol><li><p>Interest rates are rising.</p></li><li><p>There are genuine risks to Tesla’s operating performance.</p></li></ol><p>Interest rates going up takes a bite out of the value of cash flows from any company, and Elon Musk’s political commentary puts Tesla’s U.S. revenue at risk. So, a new Tesla model is needed to account for the risks. In past models, I discounted TSLA stock at just 8%. That’s a discount rate that includes a risk premium, but not a very large one. Today, Tesla is in the political crosshairs to an extent not seen when I wrote my last Tesla article, so more risk needs to be accounted for.</p><p>There are two ways to do this:</p><ol><li><p>Simply run one of my previous models at a far higher discount rate.</p></li><li><p>Lower the growth assumption.</p></li></ol><p>The first method is pretty straightforward. If you take my previous model that got a $338 FV estimate, and up the discount rate to 15%, you get a $111 price target. I think buying Tesla at that level would be basically sensible, but it helps to go even stricter still. Remember: when you buy TSLA shares, you’re paying for a lot of future growth. The nature of a ‘financial risk’ is that it can cause growth to disappear, and profits to turn into losses, so we need to account for those scenarios.</p><p>I do not think we need to model for a scenario where Tesla’s growth becomes negative. Tesla sells a lot of cars in China, a country that is not plugged into U.S. social media discourse, and where Elon Musk’s private behavior probably isn’t a concern for very many people. The U.S. market position does seem to be at risk, so we can model for a scenario where growth declines to 0%, based on current trends continuing in China while U.S. sales decline. Note that I don’t think this scenario will actually occur, it just helps to model worst case scenarios.</p><p>Under zero growth assumptions, we can simply value TSLA in terms of terminal value. This is where you discount free cash flow at a chosen discount rate. The range we get for Tesla, using 3.5% (no risk premium) and 15% (extremely large risk premium) is shown below.</p><p><img src=\"https://static.tigerbbs.com/e0f7a6ae9f247b5aac92b75634596020\" tg-width=\"735\" tg-height=\"138\" referrerpolicy=\"no-referrer\"/></p><p>So, to sum up, our total range of values under, when we account for immense risk, goes from:</p><ul><li><p>$19.33 (high discount rate, no growth).</p></li><li><p>$111 (high discount rate, high growth).</p></li></ul><p>The mean of the high and low values is $65. If you want to be extremely conservative, aim for $65 before buying Tesla. Personally, I’d probably buy at $75, because the worst-case scenarios I’m modelling for here are rather extreme. Most likely Tesla will do better than 0% growth. But in an environment of rising rates, it pays to play it safe. For the most risk averse investors, Tesla does not appear to be a buy.</p><p>This article is written by Growth at a Good Price for reference only. Please note the risks.</p></body></html>","source":"seekingalpha_fund","collect":0,"html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Tesla: I'd Buy After A 53.4% Drop</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; 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}\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nTesla: I'd Buy After A 53.4% Drop\n</h2>\n\n<h4 class=\"meta\">\n\n\n2022-12-15 14:01 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://seekingalpha.com/article/4564344-tesla-stock-buy-post-53-4-percent-drop><strong>Seeking Alpha</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SummaryTesla is a stock I'd be extra cautious about because its founder is involved in ever-more intense political controversies.I've covered it in past articles, getting fair value estimates near $...</p>\n\n<a href=\"https://seekingalpha.com/article/4564344-tesla-stock-buy-post-53-4-percent-drop\">Web Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","type":0,"thumbnail":"","relate_stocks":{"LU0056508442.USD":"贝莱德世界科技基金A2","LU0719512351.SGD":"JPMorgan Funds - US Technology A (acc) SGD","IE00B1XK9C88.USD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A\" (USD) ACC","LU0820561909.HKD":"ALLIANZ INCOME AND GROWTH \"AM\" (HKD) INC","IE00BSNM7G36.USD":"NEUBERGER BERMAN SYSTEMATIC GLOBAL SUSTAINABLE VALUE \"A\" (USD) ACC","BK4585":"ETF&股票定投概念","BK4534":"瑞士信贷持仓","TSLA":"特斯拉","LU0234572021.USD":"高盛美国核心股票组合Acc","BK4533":"AQR资本管理(全球第二大对冲基金)","BK4555":"新能源车","LU2063271972.USD":"富兰克林创新领域基金","IE00BWXC8680.SGD":"PINEBRIDGE US LARGE CAP RESEARCH ENHANCED \"A5\" (SGD) ACC","LU0097036916.USD":"贝莱德美国增长A2 USD","BK4527":"明星科技股","LU2087621335.USD":"ALLSPRING GLOBAL FACTOR ENHANCED EQUITY \"A\" (USD) ACC","LU0689472784.USD":"安联收益及增长基金Cl AM AT Acc","LU1852331112.SGD":"Blackrock World Technology Fund A2 SGD-H","LU1720051017.SGD":"Allianz Global Artificial Intelligence AT Acc H2-SGD","BK4550":"红杉资本持仓","LU1861215975.USD":"贝莱德新一代科技基金 A2","LU0198837287.USD":"UBS (LUX) EQUITY SICAV - USA GROWTH \"P\" (USD) ACC","LU1548497426.USD":"安联环球人工智能AT Acc","LU0316494557.USD":"FRANKLIN GLOBAL FUNDAMENTAL STRATEGIES \"A\" ACC","LU1861558580.USD":"日兴方舟颠覆性创新基金B","LU1861220033.SGD":"Blackrock Next Generation Technology A2 SGD-H","BK4574":"无人驾驶","LU0820561818.USD":"安联收益及增长平衡基金Cl AM DIS","LU0082616367.USD":"摩根大通美国科技A（dist）","BK4551":"寇图资本持仓","LU1551013425.SGD":"Allianz Income and Growth Cl AMg2 DIS H2-SGD","BK4581":"高盛持仓","LU0348723411.USD":"ALLIANZ GLOBAL HI-TECH GROWTH \"A\" (USD) INC","BK4099":"汽车制造商","LU1720051108.HKD":"ALLIANZ GLOBAL ARTIFICIAL INTELLIGENCE \"AT\" (HKD) ACC","BK4511":"特斯拉概念","LU0943347566.SGD":"安联收益及增长平衡基金AM H2-SGD","BK4548":"巴美列捷福持仓","LU2357305700.SGD":"Allianz Global Artificial Intelligence ET H2-SGD","LU0234570918.USD":"高盛全球核心股票组合Acc Close","LU1861559042.SGD":"日兴方舟颠覆性创新基金B SGD","LU1839511570.USD":"WELLS FARGO GLOBAL FACTOR ENHANCED EQUITY \"I\" (USD) ACC","LU0053666078.USD":"摩根大通基金-美国股票A（离岸）美元","LU0823411888.USD":"法巴消费创新基金 Cap","LU1551013342.USD":"Allianz Income and Growth Cl AMg2 DIS USD"},"source_url":"https://seekingalpha.com/article/4564344-tesla-stock-buy-post-53-4-percent-drop","is_english":true,"share_image_url":"https://static.laohu8.com/e9f99090a1c2ed51c021029395664489","article_id":"2291571778","content_text":"SummaryTesla is a stock I'd be extra cautious about because its founder is involved in ever-more intense political controversies.I've covered it in past articles, getting fair value estimates near $250 on the assumption that the company keeps growing fairly quickly.Nevertheless, I always rated it 'hold' because I thought that the uncertainty surrounding the company undermined any thesis based on future growth assumptions.In this article, I explain why I'd buy Tesla at $75, a 53.4% drop, even though its financials and growth trajectory would seem to suggest it's worth more than that.Dimitrios KambourisTesla(NASDAQ:TSLA) is one of the toughest stocks out there to analyze. On the one hand, it has strong historical growth and adominant position in its market. On the other hand, it is veryexpensive (going by valuation multiples) and its founder is constantly getting in trouble for his provocative statements. In some cases, Musk has faced legal consequences for things he has said; for example, he once had to pay a $20 million fine for claiming that he had secured funding to take Tesla private.This time around, Twitter is what’s getting people worried about their Tesla stock holdings. Elon Musk’s acquisition of Twitter was controversial in itself, now Elon musk is raising eyebrows for his posts on the platform. It would be hard to directly quote Musk’s recent posts without running afoul of Seeking Alpha’s political comment guidelines, so I will simply leave links to them off-platform here and here. Suffice it to say, the comments made some people very,very upset.Shortly after Elon posted his two notorious Tweets, Tesla stock fell 6.3% in a single trading day. There was little material news about TSLA on the day that crash happened; the most recent big story was a bullish one about a surge in deliveries from Tesla Shanghai. Most likely, Musk’s tweets caused the selloff. Given the lack of other negative news, it’s the default assumption.For me personally, nothing Musk is doing makes Tesla an “avoid at any price” stock. Tesla has great brand recognition, strong growth, and just recently got its tax credits back. The stock has a lot of things going for it. However, Musk’s risk taking is a serious enough concern for me to demand some kind of discount.In past articles, I got fair value estimates for Tesla well above the current stock price. However, I never rated the stock any higher than a hold; in one article I rated it a sell. The reason for that is the immense uncertainty that Tesla is subject to. Whether it’s Musk’s Tweets or the federal investigation of the Twitter deal, there are many risk factors, some of which could impede the growth that makes the stock appear to have such a great future. For this reason, I’d want to see a price of $75 or lower before I’d buy the stock, even though I get value estimates above $200 when I value it by conventional means.My Past Coverage of TeslaIn past articles, I’ve usually found Tesla to be worth something like $200-$300, going by a combination of multiples and discounted cash flows. In some cases, those prices were above the market price, but I never gave the stock a ‘buy’ rating, because I felt there were too many risks to the growth story. Some examples of valuations I arrived at include:$338 in “Tesla: the $4 Trillion Price Target is a Red Flag.”$879 ($293 in post-split terms) in “Tesla: the EV Tax Credit is a Huge Catalyst.”A sell rating (no specific price target) in “Long BYD, Short Tesla: a Great Tactical Pair Trade.”Now, you might wonder why I keep rating Tesla ‘hold’ or ‘sell’ when my models always give it upside. The reason has to do with how discounted cash flow models are constructed. You have to estimate future cash flows in order to make the math work, there’s no way around it. Tesla’s historical growth is extremely strong, and even if you cut the future growth estimates to half or a third of the actual historical growth, you still end up with pretty high price targets. In some of my previous articles, I cut Tesla’s future growth estimate down to the projected growth in the EV industry, which is a lot slower than Tesla’s actual growth rate. It still resulted in upside.Still, I can’t rate the stock a buy, because I do think the risks here are serious enough to potentially end Tesla’s growth streak.The first is demographics. Musk’s recent Twitter posts haven’t been received well by the demographics that tend to buy electric cars. Recently, Musk appeared on stage at a Dave Chapelle performance in San Francisco–the city with the second highest number of EV chargers in the U.S.--and was ‘booed’ by some audience members. This evidence might seem anecdotal, but it is known that Musk has low approval ratings in EV-friendly states like Oregon. Combining hard data with news reports, one gets the sense that Elon Musk isn’t being received well in States that are pushing green energy.EV ownership in the U.S. skews toward affluent, educated, progressive-leaning individuals. Tesla has more conservative customers than other EV companies do, but it still has more democrat than republican owners. Many commentators believe that Musk’s recent Twitter posts have been designed to court conservative support. It is known that Musk is popular among conservatives, and he seems to be trying to shore up that support, but the problem is that Tesla’s customers come from other groups.It’s not clear that Musk has angered enough people to get large numbers of them abandoning Tesla. A few people have said that they would buy Chevy Bolts in retaliation for Musk’s Twitter posts, but sales forecasts suggest there aren’t that many of them. By all accounts, Tesla’s sales are growing, not declining. Still, there is a possibility of Elon Musk alienating his core customer base; if he does so, we’d expect Tesla’s sales to take a hit.There’s no shortage of companies selling electric cars. We’ve got European companies like Volkswagen (OTCPK:VWAGY), American companies like General Motors (GM) and Chinese companies like NIO (NIO) building EVs now. If the people who are upset about Musk’s job at Twitter wanted to ditch Tesla, they could do so. So a loss of sales is in principle a potential risk factor.There’s also Musk’s selling of Twitter stock. As a long-term value investor, this does not really count as a risk to me, but it is a risk to those taking short term positions. Musk had to sell Tesla stock to put up collateral for the Twitter loans. He has sold at least $16.4 billion worth of TSLA, or 3.15% of the float. Insider selling of that magnitude can push a stock’s price downward, as stock prices are a function of supply and demand. If you don’t own Tesla stock now, and want to take a long-term position in the future, this is only good news, but for somebody who already owns Tesla stock, with no plans to average down, it’s very bad. If you already own Tesla and are hoping to get back to purchase prices well above $200, you might be waiting a while. Musk is rattling investor confidence and he may have more sales planned. If you don’t own Tesla stock, or own a little and plan on averaging down, then read on, because in the next section I explain why Tesla stock would be genuinely interesting at $75.Why Tesla Would Be Interesting at $75In previous sections, I explained why Tesla, with moderate growth assumptions, appeared to be worth $200 or more. In a DCF model it only takes about 20% growth in free cash flow for TSLA to come out with a fair value estimate well above $200. However, two things have to be kept in mind:Interest rates are rising.There are genuine risks to Tesla’s operating performance.Interest rates going up takes a bite out of the value of cash flows from any company, and Elon Musk’s political commentary puts Tesla’s U.S. revenue at risk. So, a new Tesla model is needed to account for the risks. In past models, I discounted TSLA stock at just 8%. That’s a discount rate that includes a risk premium, but not a very large one. Today, Tesla is in the political crosshairs to an extent not seen when I wrote my last Tesla article, so more risk needs to be accounted for.There are two ways to do this:Simply run one of my previous models at a far higher discount rate.Lower the growth assumption.The first method is pretty straightforward. If you take my previous model that got a $338 FV estimate, and up the discount rate to 15%, you get a $111 price target. I think buying Tesla at that level would be basically sensible, but it helps to go even stricter still. Remember: when you buy TSLA shares, you’re paying for a lot of future growth. The nature of a ‘financial risk’ is that it can cause growth to disappear, and profits to turn into losses, so we need to account for those scenarios.I do not think we need to model for a scenario where Tesla’s growth becomes negative. Tesla sells a lot of cars in China, a country that is not plugged into U.S. social media discourse, and where Elon Musk’s private behavior probably isn’t a concern for very many people. The U.S. market position does seem to be at risk, so we can model for a scenario where growth declines to 0%, based on current trends continuing in China while U.S. sales decline. Note that I don’t think this scenario will actually occur, it just helps to model worst case scenarios.Under zero growth assumptions, we can simply value TSLA in terms of terminal value. This is where you discount free cash flow at a chosen discount rate. The range we get for Tesla, using 3.5% (no risk premium) and 15% (extremely large risk premium) is shown below.So, to sum up, our total range of values under, when we account for immense risk, goes from:$19.33 (high discount rate, no growth).$111 (high discount rate, high growth).The mean of the high and low values is $65. If you want to be extremely conservative, aim for $65 before buying Tesla. Personally, I’d probably buy at $75, because the worst-case scenarios I’m modelling for here are rather extreme. Most likely Tesla will do better than 0% growth. But in an environment of rising rates, it pays to play it safe. For the most risk averse investors, Tesla does not appear to be a buy.This article is written by Growth at a Good Price for reference only. Please note the risks.","news_type":1},"isVote":1,"tweetType":1,"viewCount":20,"authorTweetTopStatus":1,"verified":2,"comments":[],"imageCount":0,"langContent":"EN","totalScore":0}],"hots":[],"lives":[]}