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Category: Dow Jones Industrial Average (DJIA)
Last updated: 31 August 2020 (21: 00 ET) This page takes a look at the performance of the Dow Jones Industrial Average (DJIA) for the month of August 2020 on a calendar. July 2020 was a pretty wild ride for the markets. Lets see what August 2020 holds.
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The index covers all industries except transportation and utilities. The market cap of the Dow Jones firms amounts to $8.411 trillion as at end of July 2020. "
About the Dow Jones Industrial Average (DJIA)
The Dow Jones Industrial Average® (The Dow®), is a price-weighted measure of 30 U.S. blue-chip companies. The DJIA covers all industries except transportation and utilities. The market cap of the Dow Jones firms amounts to $8.058 trillion as at end of July 2020. The Dow Jones Industrial Average has a trailing PE ratio of 21.6 and the PE is projected (forward PE) is at 23.7 with a indicated dividend yield of 2.63% and a price to book value of 3.88
Dow Jones Industrial Average (DJIA) performance during August 2020
The graphic below shows the daily performance of the Dow Jones Industrial Average (The Dow) on a calendar for the month of August 2020. The index levels used in the calculation of the daily performance of the Dow Jones Industrial Average is obtained from Macrotrends.net
For August 2020 the Dow Jones ended up the month by 7.66%
For August 2020 the Dow Jones ended up the month by 7.66%
Market news and website updates during August 2020
31 August 2020: The Dow Jones ended the last trading day of August 2020 down by -0.78%
Dow Jones Updates:
(7:52 ET): Dow Jones futures are currently trading down by 0.21%
Website Updates:
We compared the stock of BJ's Wholesale Club to that of Big Lots in order to determine which one is best placed to provide investors with superior returns over the next couple of years. Below a short extract of the article.
So let's take a look at the fundamentals and the valuation metrics in order to determine which of these two firms offers the most value at their current stock price.
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. The higher this ratio the less value a stock offers, and the lower this value the more value a stock offers. At a ratio of 1.51 for Big Lots is actually pretty low. However a stockholders deficit shows that a company's assets is less than its liabilities. And this is the case for BJ's Wholesale Club. So if they sell all their assets they wont be able to pay all their liabilities. So if they are liquidated debt holders will get any cash left and stockholders will get nothing
Next up cash as percentage of stock price:
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
Next up the PE ratio of the stock price:
Price relative to our valuation:
So BJ's Wholesale Club has a stockholders deficit, and Big Lots has a relatively low price/stockholders equity per share ratio. BJ's Wholesale is trading a higher PE ratio than Big Lots. For the cash as percentage of total assets Big Lots (BIG) cash makes up a far greater portion of their total assets than that of BJ's Wholesale Club. BJ's Wholesale Club is trading at a premium to our stock price valuation while Big Lots is trading at a discount to our latest valuation of the group.. Based on current stock prices, BJ's Wholesale is overvalued by almost 8% while Big Lots is undervalued by 13.1%.
Based on all the above if we have to buy one of these two retail giants we rate the stock of Big Lots (BIG) hands down as the WINNER in the battle between BJ's Wholesale stock vs Big Lots.
Read the full article
27 August 2020: The Dow Jones ended the day up by 0.57%
Dow Jones Updates:
(03:51 ET): Dow Jones futures are currently trading down by -0.2%
Website Updates:
The list below (sorted alphabetically) shows the newest list of Dow Jones Industrial Average constituents effective from the end of August 2020: The new additions highlighted in green:
The three constituents that were dropped:
Read the full article here
26 August 2020: The Dow ended the day up by 0.3%
Dow Jones Updates:
(0:14 ET): Dow Jones futures are currently trading down by -0.12%
Website Updates:
Yesterday we looked at another stock bubble forming, and this time its in the stock price of Overstock (OSTK). Below a short extract of that article
Overview of Overstock's latest earnings
Read the full article here
25 August 2020: The Dow Jones ended the day down by -0.21%
Dow Jones Updates:
(6:29 ET): Dow Jones futures are currently trading down -0.53%
Website Updates:
Read the full article here
24 August: The Dow Jones ended the day up by 1.35%
Dow Jones Updates:
(03:50 ET): Dow Jones Futures are currently trading up by 0.58%
Website Updates:
We covered the latest earnings report of NIO, a Chinese Electric Vehicle Manufacturer
The data below refers to their 2nd quarter 2020 earnings report:
Deliveries of vehicles were 10,331 in the second quarter of 2020, including 8,068 ES6s and 2,263 ES8s, compared with 3,553 vehicles delivered in the second quarter of 2019 and 3,838 vehicles delivered in the first quarter of 2020.
Read the full article here
20 August 2020: The Dow ended the day up by 0.17%
Dow Jones updates:
(01:38 ET): Dow Jones futures are currently trading down by -0.54%
Website updates:
We covered the latest earnings report of the 8th biggest retailer in the USA, Target Corporation (TGT). Below a short extract.
So what do we value Target Corporation's stock at based on their 4th quarter 2019 earnings report and their fiscal guidance provided? Based on Target Corporation's earnings report and the fiscal guidance provided our valuation model provides a target (full value) price for Target Corporation' stock at $130 (up from our 1st quarter 2020 earnings valuation of Target Corporation) We therefore believe the stock of Target Corporation's is overvalued at its current price of $154.22
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $130. A good entry point into Target would therefore be at $117 or below. We therefore expect the stock of Target to pull back from current levels to levels closer to our target price in coming weeks and months as we believe the stock price rally has gone to far.
Read the full article here
19 August 2020: The Dow ended the day down by -0.31%
Dow Jones updates:
(13:07 ET): Dow Jones futures are currently trading up by 0.19%
(09:07 ET): Dow Jones futures are currently trading up by 0.08%
(01:38 ET): Dow Jones futures are currently trading down by -0.14%
Website updates:
We covered the latest earnings report of the world's largest DIY store. The Home Depot. Below a short extract
So what is Home Depot stock worth based on their 2nd quarter 2020 earnings report? Based on their earnings report our valuation model provides a target price (full value price) for Home Depot at $203.70 a stock (up from our 1st quarter 2020 earnings report review of Home Depot).
We therefore believe the stock of The Home Depot is overvalued at its current price of $285
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target (full value) price, which in this case is $203.70, thus a good entry point into The Home Depot would be at $183.30 or below.
We expect the stock of Home Depot to pull back from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is overvalued and has been for some time and we believe once the spending of stimulus checks at stores such as the Home Depot and Walmart fades their reported earnings and stock prices will decline to reflect these lower sales.
Read the full article here
And we also covered the latest earnings release of Lowe's, The Home Depot's biggest rival. Below a short extract from that article
So what do we value Lowe's at based on their 2nd quarter 2020 earnings report? Based on Lowe's earnings report our valuation model provides a target price (full value price) for Lowe's stock at $149.60 (up from our 1st quarter 2020 earnings review of Lowe's). We therefore believe the stock of Lowe's is overvalued at its stock price of $157.91
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $149.60. A good entry point into Lowe's would therefore be at $134.60 or below. We expect the stock of Lowe's to trade in a narrow range around our target price (full value price) in coming weeks and months.
Read the full article here
18 August 2020: The Dow Jones ended the day down -0.24%
Dow Jones updates:
(09:38 ET): Dow Jones is currently trading at 0.05%
Website updates:
We covered the latest earnings report of Walmart. Below a short extract of this article.
So what do we believe Walmart stock is worth after their latest earnings report and their fiscal guidance provided? Based on their very strong 2nd quarter 2021 earnings report our valuation model provides a target price (full value price) for Walmart stock at $145.10 a stock .
We therefore believe the stock of Walmart is slightly undervalued at its current price.
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target (full value) price which in this case is $145.10. A good entry point into Walmart would therefore be at $130.60 or below. We expect the stock of Walmart (WMT) to kick up from its current levels to levels closer to our target price (full value price) in coming weeks and months.
Read the full article here
17 August 2020: The Dow Jones ended the day down by -0.31%
Dow Jones updates:
(12:00 ET) The Dow Jones is currently trading down by -0.27%
(1:23 ET): Dow Jones futures are currently trading down up by 0.37%
Website updates:
Yesterday we covered Cracker Barrel Old Country Store announcement that they will be updating their menu. Below an extract from that article
Guests will find these new dishes featured across three menu categories – Home Cooked Classics Starting at $7.99, Down Home Daily Dinners Under $10 and Cracker Barrel Favorites:
Read the full article here
14 August 2020: The Dow Jones ended the day up by 0.12%
Dow Jones updates:
(2:00 ET): Dow Jones futures are currently trading down up by 0.22%
Website updates:
Yesterday we compared the stock of Domino's Pizza to that of Papa Johns in our battle of the pizza franchise stocks
So let's take a look at the fundamentals and the valuation metrics in order to determine which of these two firms offers the most value at their current stock price.
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. The higher this ratio the less value a stock offers. However a stockholders deficit shows that a company's assets is less than its liabilities. And this is the case for both Domino's Pizza and Papa Johns.
Next up cash as percentage of stock price:
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
Next up the PE ratio of the stock price:
Price relative to our valuation:
Neither of the two companies has stockholders equity, as both are trading at stockholders deficits. Domino's Pizza is in the better cash position than Papa Johns based on the their cash as percentage of total assets percentage. And it is also trading at lower PE ratio than that of Papa Johns but it is trading at further away from our stock price target than what Papa Johns is. And it is for this reasons that we rate the stock of Papa Johns as the winner.
Read the full article here
13 August 2020:
Dow Jones updates:
(12:10 ET): The Dow Jones is currently trading down by -0.18%
(1:30 ET): Dow Jones futures are currently trading down by -0.04%
Website updates:
Yesterday we looked at the market capital of the 10 biggest stocks listed on the NASDAQ. Below a short extract from that article
Market Capital of the 10 largest Nasdaq listed firms (including Microsoft (MSFT), Apple (APPL), Cisco (CSCO) and Intel which is part of the Dow Jones), sorted from the biggest to the 10th biggest
So the top 10 stocks listed on the Nasdaq (including those included in the Dow Jones Industrial Average) total market capital amounts to $7.81 trillion, or about 97.8% of the total market capital of the Dow Jones Industrial Average (which is 30 stocks).
Read the full article here
12 August 2020: The Dow Jones ended the day up by 1.05%
Dow Jones updates:
(14:03 ET): The Dow Jones is currently trading 1%
(07:00 ET): Dow Jones futures are currently trading up by 0.95%
(0:56 ET): Dow Jones futures are currently trading up by 0.21%
Website updates:
Earlier we covered the latest earnings report of Grocery Outlet a retailer with a market cap of over $4 billion and whose sales topped $800 million for their latest report quarter.
So what do we value Grocery Outlet at based on their 2nd quarter 2020 earnings report a? Based on the latest earnings report from Grocery Outlet our valuation model provides a target price (full value price) for Grocery Outlet stock at $36.70 a stock. We therefore believe the stock of Grocery Outlet is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $36.70. So we would suggest looking to enter into the stock of Grocery Outlet at $33 or below.
We expect the stock of Grocery Outlet to pull back from its current price to levels closer to our target price in coming weeks and months.
Read the full article here
11 August 2020: The Dow ended the day down by -0.38%
Dow Jones updates:
(14:27 ET): The Dow Jones is currently trading up by 1.1%
(4:10 ET): Dow Jones futures are currently trading up by 1.03%
(1:46 ET): Dow Jones futures are currently trading up by 0.37%
Website updates:
Earlier we covered the latest earnings report of Royal Caribbean Group, formerly known as Royal Caribbean Cruises. Below a short extract
So what do we value Royal Caribbean Group at based on their 2nd quarter 2020 earnings report and the fact that made a significant loss during 1Q 2020? Based on their earnings report and the fact that they are loss making we have decided to value RCL at their stockholders equity per share which is $42.80 a stock. We therefore believe the stock of Royal Caribbean Group is slightly overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $48.92, so we would suggest looking to enter into the stock of Royal Caribbean Group at $38.50 or below.
We expect the stock of Royal Caribbean Group to pull back slightly from its current price to levels closer to our target price in coming weeks and months.
Read the full article here
10 August 2020: The Dow Jones ended the day up by 1.3%
Dow Jones Updates:
(13:57 ET) The Dow Jones is currently trading up by 1.01%
(4:45 ET): Dow Jones futures are currently trading up by 0.41%
(1:14 ET): Dow Jones futures are currently trading up by 0.33%
Website Updates:
Yesterday we covered the latest earnings report of general home retailer, Conn's (CONN). Below a short extract from that article
So based on Conn's 1st quarter 2021 earnings report what do we value their stock at? It is always hard to value a loss making firm. In the case where a firm is loss making we tend to use the stockholders equity per share as the base of our valuation. And Conn's stockholders equity per share is currently sitting at $17.20. And this is what we will value the group's stock at.
We therefore believe the stock of Conn's is undervalued. Also keep in mind if you buy the stock at $11.03, 90% of that price is made up by cash on the balance sheet. So the rest of the business is purchased for the oter $2 per stock.
We expect the stock of Conn's to rise sharply as the impact of Covid-19 eases.
Read the full article here
7 August: The Dow Jones ended the day up by 0.17%
Dow Jones Updates:
(06:55 ET): Dow Jones futures are currently trading down at -0.22%
(01:00 ET): Dow Jones futures are currently trading down at -0.36%
Website Updates:
Yesterday we looked at the stockholders equity per share of Berkshire Hathaway (BRKA). The summary below shows the stockholders equity and stockholders equity per share of Berkshire Hathaway (BRKA) for December 2019 and March 2020. Over the period the stockholders equity of Berkshire Hathaway declined by -12.4%
March 2020 December 2019
Total shareholders’ equity: $375.235 billion $428.563 billion
Total stockholders equity per share: $231 626 $261 438
Read the full article here
6 August 2020: The Dow Jones ended the day up by 0.68%
Dow Jones updates:
(01:11 ET): Dow futures are currently trading up by 0.16%
Website updates:
Yesterday we asked whether its a good time to buy the stock of Apple (APPL)
Is this a good time to buy the stock of Apple (APPL)? The short simple answer to this question is absolutely.. NOT. Its overvalued and if you buying into the stock now you run the risk of significant losses should the stock price correction takes place to bring it back to more realistic valuations.
Read the full article here
5 August 2020: The Dow Jones ended the day up by 1.39%
Dow Jones updates:
(11:28ET): The Dow is currently trading up by 1.24%
(06:44 ET): Dow futures are currently trading up by 0.72%
(01:27 ET): Dow futures are currently trading up by 0.12%
Website updates:
Yesterday we covered the market capital of the 10 biggest stocks on the NASDAQ and compared it to the total market capital of the Dow Jones. Below an extract of the article.
Market Capital of the 10 largest Nasdaq listed firms (including Microsoft (MSFT), Apple (APPL), Cisco (CSCO) and Intel which is part of the Dow Jones)
So the top 10 stocks listed on the Nasdaq (including those included in the Dow Jones Industrial Average) total market capital amounts to $7.96 trillion, or about 98.8% of the total market capital of the Dow Jones Industrial Average (which is 30 stocks).
This just shows how the tech heavy Nasdaq is growing and becoming ever more important in the world of financial markets. Who knows, over time perhaps the Nasdaq will replace the Dow Jones as the most quoted and used major market index.
Read the full article here
4 August: The Dow Jones ended the day up 0.62%
Dow Jones Updates:
(15:09 ET): The Dow Jones is currently trading up by 0.35%
(06:47 ET): Dow Jones futures are currently trading down by -0.18%
(0:27 ET): Dow Jones futures are currently trading up by 0.03%
Website Updates:
We covered the latest earnings report of Dunkin' Brands. Below a short extract of that article
So what do we value Dunkin' Brands stock at after the release of their 2nd quarter 2020 earnings report? Based on Dunkin' Brands earnings report our valuation models provides a target price (full value price) of Dunkin' Brands at $46.10 a stock. We therefore believe that the stock of Dunkin' Brands is overvalued.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $46.10 therefore we believe a good entry point into Dunkin' Brands stock is at $41.50 or below. We expect the stock of Dunkin' Brands to pull back from current levels to levels closer to our target price (full value price) in coming weeks and moths as we believe it is significantly overvalued at this point in time.
We therefore rate Dunkin' Brands as a sell
Read the full article here
3 August: The Dow Jones ended the day up by 0.89%
Dow Jones Updates:
(13:08 ET): The Dow Jones is currently trading up by 0.85%
(0:27 ET): Dow Jones futures are currently trading down by -0.21%
Website Updates:
Apple (APPL) vs Amazon (AMZN) vs Alphabet (GOOGL). Who comes out on top?
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
Based on this metric Alphabet offers far more value than Amazon and Apple. Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. What it shows that if a firm was to be liquited now, all assets sold, liabilities paid and the rest paid out to stockholders, that amount is expressed as a ratio to the stock price.
Next up cash as percentage of stock price:
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
PE ratio:
Apple has the lowest PE ratio and Amazon by far the highest
Price/Valuation ratio: This ratio is the current stock price divided by our latest valuation price for each stock
So based on this Alphabet offers the most value right now, but its still almost 20% more than our target price, while Amazon is trading at more than double our valuation price and Apple roughly 71% our valuation price.
Read the full article here
Yesterday we covered the latest earnings report of Alphabet (GOOGL). Below a short extract of that article
So what do we value Alphabet at based on their latest earnings report, their earnings per share, cash generated from their operations and the group's future prospects. Based on Alphabet's latest earnings report our valuation model provides a target price (full value price) at $1240.20 a Alphabet stock (up slightly from our 1st quarter 2020 earnings report valuation of Alphabet). We therefore believe the stock of Alphabet is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $1240.20 so we would suggest looking to buy Alphabet at around $1116 a stock. Since the stock of Alphabet (GOOGL) is trading at well above our suggested entry point into the stock we will go against popular market and pundits opinions and rate the stock of Alphabet as a sell
Read the full article here
Dow Jones Updates:
(7:52 ET): Dow Jones futures are currently trading down by 0.21%
Website Updates:
We compared the stock of BJ's Wholesale Club to that of Big Lots in order to determine which one is best placed to provide investors with superior returns over the next couple of years. Below a short extract of the article.
So let's take a look at the fundamentals and the valuation metrics in order to determine which of these two firms offers the most value at their current stock price.
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
- Price/Stockholders equity per share for BJ's Wholesale Club (BJ): Stockholders deficit so this ratio cannot be calculated
- Price/Stockholders equity per share for Big Lots (BIG): 1.51
Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. The higher this ratio the less value a stock offers, and the lower this value the more value a stock offers. At a ratio of 1.51 for Big Lots is actually pretty low. However a stockholders deficit shows that a company's assets is less than its liabilities. And this is the case for BJ's Wholesale Club. So if they sell all their assets they wont be able to pay all their liabilities. So if they are liquidated debt holders will get any cash left and stockholders will get nothing
Next up cash as percentage of stock price:
- Cash as percentage of stock price for BJ's Wholesale Club (BJ): 2.6%
- Cash as percentage of stock price for Big Lots (BIG): 44.9%
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
- Cash as percentage of stock price for BJ's Wholesale Club (BJ): 3.2%
- Cash as percentage of stock price for Big Lots (BIG): 21.5%
Next up the PE ratio of the stock price:
- PE ratio of BJ's Wholesale Club (BJ): 15.8
- PE ratio for Big Lots (BIG) : 7
Price relative to our valuation:
- BJ's Wholesale Club (BJ): 7.8% overvalued based on our latest stock valuation
- Big Lots (BIG): 13.1% undervalued based on our latest stock valuation
So BJ's Wholesale Club has a stockholders deficit, and Big Lots has a relatively low price/stockholders equity per share ratio. BJ's Wholesale is trading a higher PE ratio than Big Lots. For the cash as percentage of total assets Big Lots (BIG) cash makes up a far greater portion of their total assets than that of BJ's Wholesale Club. BJ's Wholesale Club is trading at a premium to our stock price valuation while Big Lots is trading at a discount to our latest valuation of the group.. Based on current stock prices, BJ's Wholesale is overvalued by almost 8% while Big Lots is undervalued by 13.1%.
Based on all the above if we have to buy one of these two retail giants we rate the stock of Big Lots (BIG) hands down as the WINNER in the battle between BJ's Wholesale stock vs Big Lots.
Read the full article
27 August 2020: The Dow Jones ended the day up by 0.57%
Dow Jones Updates:
(03:51 ET): Dow Jones futures are currently trading down by -0.2%
Website Updates:
The list below (sorted alphabetically) shows the newest list of Dow Jones Industrial Average constituents effective from the end of August 2020: The new additions highlighted in green:
- 3M Co.
- American Express Co.
- Amgen
- Apple Inc
- Boeing Co.
- Caterpillar Inc.
- Chevron Corp.
- Cisco Systems, Inc.
- Coca-Cola Co
- Dow Inc
- Goldman Sachs Group, Inc.
- Home Depot, Inc.
- Honeywell
- IBM
- Intel Corp.
- Johnson & Johnson
- JPMorgan Chase & Co.
- McDonald's Corp
- Merck & Co Inc
- Microsoft Corporation
- Nike, Inc. - Class B Shares
- Procter & Gamble Co.
- Salesforce
- Travelers Companies Inc.
- Unitedhealth Group Inc
- Verizon Communications Inc
- Visa Inc - Class A Shares
- Walgreens Boots Alliance Inc
- Walmart Inc
The three constituents that were dropped:
- Exxon
- Pfizer
- Raytheon
Read the full article here
26 August 2020: The Dow ended the day up by 0.3%
Dow Jones Updates:
(0:14 ET): Dow Jones futures are currently trading down by -0.12%
Website Updates:
Yesterday we looked at another stock bubble forming, and this time its in the stock price of Overstock (OSTK). Below a short extract of that article
Overview of Overstock's latest earnings
- Total net revenue was $783 million, an increase of 109% year over year
- Gross profit was $180 million or 23.0% of total net revenue, an improvement of 321 basis points year over year
- Net income attributable to stockholders of Overstock.com, Inc. was $36 million, an improvement of $61 million year over year
- Diluted earnings per share was $0.84, an improvement of $1.53 year over year
- PE ratio of 119.8
- So investors are paying $119.8 for every $1 in profits that Overstock makes. That's a yield of 0.84% on your investment. Not exactly the greatest yield out there.
- Adjusted EBITDA (non-GAAP) was $42 million, an improvement of $55 million year over year
- YTD net cash provided by operating activities was $170 million, an improvement of $236 million year over year
- YTD free cash flow (non-GAAP) improved $237 million year over year
- At the end of the second quarter, cash and cash equivalents totaled $319 million
- Cash per share: $7.87
- Cash makes up 6.5% of Overstock's stock price
- Stockholders equity in Overstock: $203.348 million
- Stockholders equity per share: $5
- So Overstock is trading at 23.9 times its stockholders equity per share. This is well outside the expected range of between 2 and 4 times that most firms tend.
- If Overstock were to sell all its assets, pay all its liabilities and distribute what is left evenly amongst stockholders you will get $5 a stock. So why on earth would you pay $119 per stock?
Read the full article here
25 August 2020: The Dow Jones ended the day down by -0.21%
Dow Jones Updates:
(6:29 ET): Dow Jones futures are currently trading down -0.53%
Website Updates:
- Total net revenue was $783 million, an increase of 109% year over year
- Gross profit was $180 million or 23.0% of total net revenue, an improvement of 321 basis points year over year
- Net income attributable to stockholders of Overstock.com, Inc. was $36 million, an improvement of $61 million year over year
- Diluted earnings per share was $0.84, an improvement of $1.53 year over year
- PE ratio of 119.8
- So investors are paying $119.8 for every $1 in profits that Overstock makes. That's a yield of 0.84% on your investment. Not exactly the greatest yield out there.
- Adjusted EBITDA (non-GAAP) was $42 million, an improvement of $55 million year over year
- YTD net cash provided by operating activities was $170 million, an improvement of $236 million year over year
- YTD free cash flow (non-GAAP) improved $237 million year over year
- At the end of the second quarter, cash and cash equivalents totaled $319 million
- Cash per share: $7.87
- Cash makes up 6.5% of Overstock's stock price
- Stockholders equity in Overstock: $203.348 million
- Stockholders equity per share: $5
- So Overstock is trading at 23.9 times its stockholders equity per share. This is well outside the expected range of between 2 and 4 times that most firms tend.
- If Overstock were to sell all its assets, pay all its liabilities and distribute what is left evenly amongst stockholders you will get $5 a stock. So why on earth would you pay $119 per stock?
- For some perspective the average price to book ratio of firms in the S&P 500 is 3.7 times
Read the full article here
24 August: The Dow Jones ended the day up by 1.35%
Dow Jones Updates:
(03:50 ET): Dow Jones Futures are currently trading up by 0.58%
Website Updates:
We covered the latest earnings report of NIO, a Chinese Electric Vehicle Manufacturer
The data below refers to their 2nd quarter 2020 earnings report:
- Vehicle Sales in US $ : 493.4 million
- Vehicle Margin: 9.7%
- Gross profit: $44.3 million
- Net loss: -$166.5 million
- Net loss per share: -$0.16
Deliveries of vehicles were 10,331 in the second quarter of 2020, including 8,068 ES6s and 2,263 ES8s, compared with 3,553 vehicles delivered in the second quarter of 2019 and 3,838 vehicles delivered in the first quarter of 2020.
Read the full article here
20 August 2020: The Dow ended the day up by 0.17%
Dow Jones updates:
(01:38 ET): Dow Jones futures are currently trading down by -0.54%
Website updates:
We covered the latest earnings report of the 8th biggest retailer in the USA, Target Corporation (TGT). Below a short extract.
So what do we value Target Corporation's stock at based on their 4th quarter 2019 earnings report and their fiscal guidance provided? Based on Target Corporation's earnings report and the fiscal guidance provided our valuation model provides a target (full value) price for Target Corporation' stock at $130 (up from our 1st quarter 2020 earnings valuation of Target Corporation) We therefore believe the stock of Target Corporation's is overvalued at its current price of $154.22
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $130. A good entry point into Target would therefore be at $117 or below. We therefore expect the stock of Target to pull back from current levels to levels closer to our target price in coming weeks and months as we believe the stock price rally has gone to far.
Read the full article here
19 August 2020: The Dow ended the day down by -0.31%
Dow Jones updates:
(13:07 ET): Dow Jones futures are currently trading up by 0.19%
(09:07 ET): Dow Jones futures are currently trading up by 0.08%
(01:38 ET): Dow Jones futures are currently trading down by -0.14%
Website updates:
We covered the latest earnings report of the world's largest DIY store. The Home Depot. Below a short extract
So what is Home Depot stock worth based on their 2nd quarter 2020 earnings report? Based on their earnings report our valuation model provides a target price (full value price) for Home Depot at $203.70 a stock (up from our 1st quarter 2020 earnings report review of Home Depot).
We therefore believe the stock of The Home Depot is overvalued at its current price of $285
We usually recommend long term fundamental or value investors look to enter a stock at least 10% below our target (full value) price, which in this case is $203.70, thus a good entry point into The Home Depot would be at $183.30 or below.
We expect the stock of Home Depot to pull back from current levels in coming weeks and months to levels closer to our target price (full value price), as their stock is price is overvalued and has been for some time and we believe once the spending of stimulus checks at stores such as the Home Depot and Walmart fades their reported earnings and stock prices will decline to reflect these lower sales.
Read the full article here
And we also covered the latest earnings release of Lowe's, The Home Depot's biggest rival. Below a short extract from that article
So what do we value Lowe's at based on their 2nd quarter 2020 earnings report? Based on Lowe's earnings report our valuation model provides a target price (full value price) for Lowe's stock at $149.60 (up from our 1st quarter 2020 earnings review of Lowe's). We therefore believe the stock of Lowe's is overvalued at its stock price of $157.91
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target price (full value price) which in this case is $149.60. A good entry point into Lowe's would therefore be at $134.60 or below. We expect the stock of Lowe's to trade in a narrow range around our target price (full value price) in coming weeks and months.
Read the full article here
18 August 2020: The Dow Jones ended the day down -0.24%
Dow Jones updates:
(09:38 ET): Dow Jones is currently trading at 0.05%
Website updates:
We covered the latest earnings report of Walmart. Below a short extract of this article.
So what do we believe Walmart stock is worth after their latest earnings report and their fiscal guidance provided? Based on their very strong 2nd quarter 2021 earnings report our valuation model provides a target price (full value price) for Walmart stock at $145.10 a stock .
We therefore believe the stock of Walmart is slightly undervalued at its current price.
We usually recommend that long term fundamental or value investors look to enter a stock at least 10% below our target (full value) price which in this case is $145.10. A good entry point into Walmart would therefore be at $130.60 or below. We expect the stock of Walmart (WMT) to kick up from its current levels to levels closer to our target price (full value price) in coming weeks and months.
Read the full article here
17 August 2020: The Dow Jones ended the day down by -0.31%
Dow Jones updates:
(12:00 ET) The Dow Jones is currently trading down by -0.27%
(1:23 ET): Dow Jones futures are currently trading down up by 0.37%
Website updates:
Yesterday we covered Cracker Barrel Old Country Store announcement that they will be updating their menu. Below an extract from that article
Guests will find these new dishes featured across three menu categories – Home Cooked Classics Starting at $7.99, Down Home Daily Dinners Under $10 and Cracker Barrel Favorites:
- Home Cooked Classics include the Maple Bacon Grilled Chicken, complete with two grilled chicken breasts topped with sweet n' smoky maple glaze, bacon and melted cheese, plus choice of two country sides, and buttermilk biscuits or corn muffins.
- Down Home Daily Dinners offer a different meal each day of the week with Saturdays featuring the Country Fried Pork Chops, two crispy hand-breaded fried pork chops smothered in roasted pan gravy, plus choice of two country sides; and Sundays spotlighting the Pot Roast Supper, an oven-braised beef roast with red potatoes, carrots, onions, celery and tomatoes in a savory beef broth – plus, each daily dinner includes a choice of buttermilk biscuits or corn muffins.
- Cracker Barrel Favorites pay homage to Cracker Barrel's signature, craveable dishes highlighted by the introduction of the Barrel-Cut Sugar Ham, a generous portion of Cracker Barrel's extra thick-sliced bone-in Sugar Ham steak, served with choice of three country sides, and buttermilk biscuits or corn muffins.
Read the full article here
14 August 2020: The Dow Jones ended the day up by 0.12%
Dow Jones updates:
(2:00 ET): Dow Jones futures are currently trading down up by 0.22%
Website updates:
Yesterday we compared the stock of Domino's Pizza to that of Papa Johns in our battle of the pizza franchise stocks
So let's take a look at the fundamentals and the valuation metrics in order to determine which of these two firms offers the most value at their current stock price.
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
- Price/Stockholders equity per share for Papa Johns (PZZA): Stockholders deficit so this ratio cannot be calculated
- Price/Stockholders equity per share for Domino's Pizza (DPZ): Stockholders deficit so this ratio cannot be calculated
Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. The higher this ratio the less value a stock offers. However a stockholders deficit shows that a company's assets is less than its liabilities. And this is the case for both Domino's Pizza and Papa Johns.
Next up cash as percentage of stock price:
- Cash as percentage of stock price for Papa Johns: 2.5%
- Cash as percentage of stock price for Domino's Pizza (DPZ): 1.53%
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
- Cash as percentage of stock price for Papa Johns (PZZA): 5.1%
- Cash as percentage of stock price for Domino's Pizza (DPZ): 15.7%
Next up the PE ratio of the stock price:
- PE ratio for Papa Johns: 48.3
- PE ratio for Domino's Pizza : 34
Price relative to our valuation:
- Papa Johns (PZZA): 41.8% overvalued based on our latest stock valuation
- Domino's Pizza (DPZ): 89.5% overvalued based on our latest stock valuation
Neither of the two companies has stockholders equity, as both are trading at stockholders deficits. Domino's Pizza is in the better cash position than Papa Johns based on the their cash as percentage of total assets percentage. And it is also trading at lower PE ratio than that of Papa Johns but it is trading at further away from our stock price target than what Papa Johns is. And it is for this reasons that we rate the stock of Papa Johns as the winner.
Read the full article here
13 August 2020:
Dow Jones updates:
(12:10 ET): The Dow Jones is currently trading down by -0.18%
(1:30 ET): Dow Jones futures are currently trading down by -0.04%
Website updates:
Yesterday we looked at the market capital of the 10 biggest stocks listed on the NASDAQ. Below a short extract from that article
Market Capital of the 10 largest Nasdaq listed firms (including Microsoft (MSFT), Apple (APPL), Cisco (CSCO) and Intel which is part of the Dow Jones), sorted from the biggest to the 10th biggest
- Apple (APPL): $1.87 trillion
- Microsoft (MSFT): $1.54 trillion
- Amazon (AMZN): $1.54 trillion
- Alphabet (GOOGL): $1.01 trillion
- Facebook (FB): $729.7billion
- Nvidia (NVDA): $266.9 billion
- Paypal (PYPL): $221.8 billion
- Netflix (NFLX): $209.5billion
- Adobe (ADBE): $208.8 billion
- Intel (INTC): $204.9 billion
So the top 10 stocks listed on the Nasdaq (including those included in the Dow Jones Industrial Average) total market capital amounts to $7.81 trillion, or about 97.8% of the total market capital of the Dow Jones Industrial Average (which is 30 stocks).
Read the full article here
12 August 2020: The Dow Jones ended the day up by 1.05%
Dow Jones updates:
(14:03 ET): The Dow Jones is currently trading 1%
(07:00 ET): Dow Jones futures are currently trading up by 0.95%
(0:56 ET): Dow Jones futures are currently trading up by 0.21%
Website updates:
Earlier we covered the latest earnings report of Grocery Outlet a retailer with a market cap of over $4 billion and whose sales topped $800 million for their latest report quarter.
So what do we value Grocery Outlet at based on their 2nd quarter 2020 earnings report a? Based on the latest earnings report from Grocery Outlet our valuation model provides a target price (full value price) for Grocery Outlet stock at $36.70 a stock. We therefore believe the stock of Grocery Outlet is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $36.70. So we would suggest looking to enter into the stock of Grocery Outlet at $33 or below.
We expect the stock of Grocery Outlet to pull back from its current price to levels closer to our target price in coming weeks and months.
Read the full article here
11 August 2020: The Dow ended the day down by -0.38%
Dow Jones updates:
(14:27 ET): The Dow Jones is currently trading up by 1.1%
(4:10 ET): Dow Jones futures are currently trading up by 1.03%
(1:46 ET): Dow Jones futures are currently trading up by 0.37%
Website updates:
Earlier we covered the latest earnings report of Royal Caribbean Group, formerly known as Royal Caribbean Cruises. Below a short extract
So what do we value Royal Caribbean Group at based on their 2nd quarter 2020 earnings report and the fact that made a significant loss during 1Q 2020? Based on their earnings report and the fact that they are loss making we have decided to value RCL at their stockholders equity per share which is $42.80 a stock. We therefore believe the stock of Royal Caribbean Group is slightly overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $48.92, so we would suggest looking to enter into the stock of Royal Caribbean Group at $38.50 or below.
We expect the stock of Royal Caribbean Group to pull back slightly from its current price to levels closer to our target price in coming weeks and months.
Read the full article here
10 August 2020: The Dow Jones ended the day up by 1.3%
Dow Jones Updates:
(13:57 ET) The Dow Jones is currently trading up by 1.01%
(4:45 ET): Dow Jones futures are currently trading up by 0.41%
(1:14 ET): Dow Jones futures are currently trading up by 0.33%
Website Updates:
Yesterday we covered the latest earnings report of general home retailer, Conn's (CONN). Below a short extract from that article
So based on Conn's 1st quarter 2021 earnings report what do we value their stock at? It is always hard to value a loss making firm. In the case where a firm is loss making we tend to use the stockholders equity per share as the base of our valuation. And Conn's stockholders equity per share is currently sitting at $17.20. And this is what we will value the group's stock at.
We therefore believe the stock of Conn's is undervalued. Also keep in mind if you buy the stock at $11.03, 90% of that price is made up by cash on the balance sheet. So the rest of the business is purchased for the oter $2 per stock.
We expect the stock of Conn's to rise sharply as the impact of Covid-19 eases.
Read the full article here
7 August: The Dow Jones ended the day up by 0.17%
Dow Jones Updates:
(06:55 ET): Dow Jones futures are currently trading down at -0.22%
(01:00 ET): Dow Jones futures are currently trading down at -0.36%
Website Updates:
Yesterday we looked at the stockholders equity per share of Berkshire Hathaway (BRKA). The summary below shows the stockholders equity and stockholders equity per share of Berkshire Hathaway (BRKA) for December 2019 and March 2020. Over the period the stockholders equity of Berkshire Hathaway declined by -12.4%
March 2020 December 2019
Total shareholders’ equity: $375.235 billion $428.563 billion
Total stockholders equity per share: $231 626 $261 438
Read the full article here
6 August 2020: The Dow Jones ended the day up by 0.68%
Dow Jones updates:
(01:11 ET): Dow futures are currently trading up by 0.16%
Website updates:
Yesterday we asked whether its a good time to buy the stock of Apple (APPL)
Is this a good time to buy the stock of Apple (APPL)? The short simple answer to this question is absolutely.. NOT. Its overvalued and if you buying into the stock now you run the risk of significant losses should the stock price correction takes place to bring it back to more realistic valuations.
Read the full article here
5 August 2020: The Dow Jones ended the day up by 1.39%
Dow Jones updates:
(11:28ET): The Dow is currently trading up by 1.24%
(06:44 ET): Dow futures are currently trading up by 0.72%
(01:27 ET): Dow futures are currently trading up by 0.12%
Website updates:
Yesterday we covered the market capital of the 10 biggest stocks on the NASDAQ and compared it to the total market capital of the Dow Jones. Below an extract of the article.
Market Capital of the 10 largest Nasdaq listed firms (including Microsoft (MSFT), Apple (APPL), Cisco (CSCO) and Intel which is part of the Dow Jones)
- Apple: $1.89 trillion
- Microsoft: $1.64 trillion
- Amazon: $1.56 trillion
- Alphabet: $1.01 trillion
- Facebook: $718.4 billion
- Nvidia: $270.9 billion
- Paypal: $231.4 billion
- Netflix: $219.9 billion
- Adobe: $214.9 billion
- Intel: $205.4 billion
So the top 10 stocks listed on the Nasdaq (including those included in the Dow Jones Industrial Average) total market capital amounts to $7.96 trillion, or about 98.8% of the total market capital of the Dow Jones Industrial Average (which is 30 stocks).
This just shows how the tech heavy Nasdaq is growing and becoming ever more important in the world of financial markets. Who knows, over time perhaps the Nasdaq will replace the Dow Jones as the most quoted and used major market index.
Read the full article here
4 August: The Dow Jones ended the day up 0.62%
Dow Jones Updates:
(15:09 ET): The Dow Jones is currently trading up by 0.35%
(06:47 ET): Dow Jones futures are currently trading down by -0.18%
(0:27 ET): Dow Jones futures are currently trading up by 0.03%
Website Updates:
We covered the latest earnings report of Dunkin' Brands. Below a short extract of that article
So what do we value Dunkin' Brands stock at after the release of their 2nd quarter 2020 earnings report? Based on Dunkin' Brands earnings report our valuation models provides a target price (full value price) of Dunkin' Brands at $46.10 a stock. We therefore believe that the stock of Dunkin' Brands is overvalued.
We usually suggest that long term and fundamental investors get in at least 10% below our target (full value) price which in this case is $46.10 therefore we believe a good entry point into Dunkin' Brands stock is at $41.50 or below. We expect the stock of Dunkin' Brands to pull back from current levels to levels closer to our target price (full value price) in coming weeks and moths as we believe it is significantly overvalued at this point in time.
We therefore rate Dunkin' Brands as a sell
Read the full article here
3 August: The Dow Jones ended the day up by 0.89%
Dow Jones Updates:
(13:08 ET): The Dow Jones is currently trading up by 0.85%
(0:27 ET): Dow Jones futures are currently trading down by -0.21%
Website Updates:
Apple (APPL) vs Amazon (AMZN) vs Alphabet (GOOGL). Who comes out on top?
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
- Price/Stockholders equity per share for Alphabet: 5.05
- Price/Stockholders equity per share for Amazon : 21.2
- Price/Stockholders equity per share for Apple : 23.2
Based on this metric Alphabet offers far more value than Amazon and Apple. Most firms tend to trade at a ratio of between 2 and 4 times its stockholders equity per share. What it shows that if a firm was to be liquited now, all assets sold, liabilities paid and the rest paid out to stockholders, that amount is expressed as a ratio to the stock price.
Next up cash as percentage of stock price:
- Cash as percentage of stock price for Alphabet: 1.7%
- Cash as percentage of stock price for Amazon: 2.4%
- Cash as percentage of stock price for Apple: 1.9%
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
- Cash as percentage of stock price for Alphabet: 6.4%
- Cash as percentage of stock price for Amazon: 16.02%
- Cash as percentage of stock price for Apple: 10.5%
PE ratio:
- PE ratio of Alphabet: 35.6
- PE ratio of Amazon: 76.3
- PE ratio of Apple: 28.2
Apple has the lowest PE ratio and Amazon by far the highest
Price/Valuation ratio: This ratio is the current stock price divided by our latest valuation price for each stock
- Price/Valuation ratio of Alphabet: 1.19
- Price/Valuation ratio of Amazon: 2.13
- Price/Valuation ratio of Apple: 1.71
So based on this Alphabet offers the most value right now, but its still almost 20% more than our target price, while Amazon is trading at more than double our valuation price and Apple roughly 71% our valuation price.
Read the full article here
Yesterday we covered the latest earnings report of Alphabet (GOOGL). Below a short extract of that article
So what do we value Alphabet at based on their latest earnings report, their earnings per share, cash generated from their operations and the group's future prospects. Based on Alphabet's latest earnings report our valuation model provides a target price (full value price) at $1240.20 a Alphabet stock (up slightly from our 1st quarter 2020 earnings report valuation of Alphabet). We therefore believe the stock of Alphabet is overvalued
We usually recommend that long term fundamental or value investors look to enter a stock at at least 10% below our target price, which in this case is $1240.20 so we would suggest looking to buy Alphabet at around $1116 a stock. Since the stock of Alphabet (GOOGL) is trading at well above our suggested entry point into the stock we will go against popular market and pundits opinions and rate the stock of Alphabet as a sell
Read the full article here