How well can dividend forecasts for individual stocks predict their future prices? That's a question that we took on earlier this year, where we resuscitated an old stock price prediction technique to see how well it might work to identify potential investment opportunities for five companies, whose stocks had been identified as strong candidates for dividend increases during 2017-Q1. The five stocks and their dividend increase forecasts were: Comcast (NASDAQ: CMCSA) - 15% increase Home Depot (NYSE: HD) - 14% increase Cisco Systems (NASDAQ: CSCO) - 15% increase TJX Companies (NYSE: TJX) - 16% increase Vulcan Materials (NYSE: VMC) - 25% increase We then took annual dividend data and the stock prices recorded for each of these firms on the first day of trading in each year going back over the last several years, and plotted a relationship between them. We then used that relationship to identify if any stock prices in early 2017 were either potentially overvalued or undervalued with respect to the trends we identified. And then we sat back until we had results to see how the stock prices for each changed after they declared their dividends during the quarter. We now have the results for 4 of the 5 companies, where we're only awaiting TJX's next dividend declarations to officially close the books on this experiment. The following chart shows the historical data we used to generate the trendlines for each stock, their forecast annual dividend for 2017, where their stock prices went on the day they declared their dividends and also where they were as of the close of trading on 20 March 2017. In our original forecast, we had only identified two stocks that offered any sort of investment potential based on the value of their stock prices with respect to their trendlines: Home Depot (NYSE: HD), which looked to be undervalued, and Vulcan Materials (NYSE: VMC), which looked to be overvalued. In the nearly two months since that analysis, we see that both assessments were correct. In VMC's case, we see that as VMC's dividend came in as expected, its stock price has moved downward to converge with its trendline. In Home Depot's case however, we see that company's dividend hike was far in excess of what had been forecast for it as the company reported a blowout quarter, where its stock price has risen, but not as strongly as its trendline would have suggested it might. And in truth, it has been diverging away from its historic trendline even as it has risen, which perhaps suggests that older trend may no longer be in effect and needs to be redrawn. There was one real surprise for the quarter where these five stocks were concerned. Bucking the best-laid plans of professional dividend forecasters, Comcast (NASDAQ: CMCSA) pulled a fast one and split its stock on a 2:1 ratio, halving its dividend and very nearly also its stock price! The fun part of that change is that the stock price appears to have continued to track along its trendline, although it is now on the high side of it, suggesting that the stock is somewhat overvalued. Meanwhile, the stock price for Cisco Systems (NASDAQ: CSCO) behaved almost exactly as expected, keeping comparatively close to both its forecast and its historic trendline. After TJX has declared its next dividend, which we think will be in April, we'll update the original version of this post on our site.
On Tuesday night, President Donald Trump gave his first address to a joint session of Congress, and during the speech, the president called on Congress to approve a $1 trillion infrastructure bill to create "a new program of national rebuilding."
The fourth-quarter earnings season is on its last leg with 92.3% construction companies in the S&P 500 cohort already having released quarterly results.
The fourth-quarter earnings season is on its last leg with 92.3% construction companies in the S&P 500 cohort already having released quarterly results.
Martin Marietta Materials, Inc. (MLM) is set to report fourth-quarter 2016 results on Feb 14, before market opens.
Vulcan Materials Company's (VMC) fourth-quarter 2016 adjusted earnings of 69 cents per share missed the Zacks Consensus Estimate of 83 cents by 16.8%. Also, the bottom line decreased 6.7% from the prior-year quarter.
Vulcan Materials Company (VMC) is the largest producer of construction aggregates in the U.S.
The Q4 earnings season has so far seen quarterly releases from 53.8% of the construction companies in the S&P 500 cohort. Total earnings at these construction companies increased 10.2% on 10.7% higher revenues.
Vulcan Materials Company (VMC) is scheduled to release fourth-quarter 2016 financial numbers, before the opening bell on Feb 7.
How can you tell if a given company's stock is overvalued, undervalued or priced just right? If you're the kind of trader who likes to try their hand at picking winners and avoiding losers, that's the million dollar question, isn't it? But for stocks of firms that pay dividends, there may be a tangible way to determine the answer to that question, provided that you know how those firms will act to change their dividends in the future. And as it happens, we have a speculative forecast for how five S&P 500 firms are expected to do just that in 2017, but who, as yet, have not declared what they will do. The following list summarizes the forecast for dividends for each of the companies: Comcast (NASDAQ: CMCSA) - 15% increase Home Depot (NYSE: HD) - 14% increase Cisco Systems (NASDAQ: CSCO) - 15% increase TJX Companies (NYSE: TJX) - 16% increase Vulcan Materials (NYSE: VMC) - 25% increase Being able to do something useful with this knowledge requires some familiarity with the concept of the dividend discount model, where stock prices are recognized as representing the approximate net present value of all dividends that will be paid to shareholders in the future, and also the part of the efficient market hypothesis that says that stock prices will almost instantaneously incorporate information about the future as it becomes known. [In reality, the relationship between the current prices of stocks and their expected future dividends per share is more complex than these two simple assumptions suggest, but we can still put them to work to do something interesting. (Remember the motto: All models are wrong, but some are useful!)] The way we'll do that is to chart the relationship between the stock prices at the beginning of the last several years and the actual annual dividends per share that each company would go on to pay out during each of those years. For the historical data shown in this chart, what we're effectively doing is pretending that investors had perfect knowledge of what dividends each firm would pay out during the year to come, which they incorporated into the closing stock price for each company on the first trading day of each year. We then calculated linear trend lines to approximate the relationship between the first trading day of the year's stock price for each company and the forward annual dividends per share that each would pay, extending the trend lines out past the point of the forecast dividends per share for 2017. We then added one last point, indicating the forecast annual dividends per share for 2017 for each company along with its stock price as of the close of 6 January 2017. As you can see, we obtained some pretty interesting results. For three of the firms, Comcast, TJX and Cisco Systems, we find that the forecast data points for 2017 are all within a fairly small margin of error of the trendlines projected from the historic data. This result suggests that the stock prices of these firms are priced about right. But we have some significant deviations when we look at the forecast values for both Home Depot and Vulcan Materials, where Home Depot's stock would appear to be undervalued and Vulcan Materials would appear to be overvalued. Are they though? Could VMC be experiencing something of a speculative bubble that could soon pop? Or could investors be expecting the board of Vulcan materials to boost the company's dividend by more than what has been forecast for 2017? Similar questions arise about Home Depot. Is the stock price being unnaturally depressed by investor pessimism about the company's future prospects? Or does HD's board have plans for a much smaller dividend increase than the forecast anticipates? And how might potential changes in either Home Depot's or VMC's stock buyback programs change the dividend per share math (and stock prices) for the firms? All you need to do to pick winning trades is to answer questions like these! We should know most of the answers to the questions we've asked in this post by the end of 2017-Q1, if not early in 2017-Q2. On a final note, the kind of analysis we just showed isn't new by any stretch, but more often than not, when it has been presented, has typically been purely backwards-looking. What we're doing that's new is applying it to look forward in time with information that is still potentially actionable. We're looking forward to finding out how it all plays out.
Under the patchwork system, some of Trump's mega wealthy picks could get voted on before their financial disclosures are made public.
T. Rowe Price Mid-Cap Value (TRMCX) a Zacks Rank #1 (Strong Buy) seeks long-term capital appreciation by investing primarily in mid-sized companies believed to be undervalued.
Donald Trump, America's Pathological Liar-in-Chief and First Bully, has nominated a cabinet of billionaires, corporate raiders, right-wing conspiracy theorists, and war hawks. In many cases, they oppose the mission of the agencies they've been picked to run. As a group, their web of affiliations and disdain for the common good should disqualify them from any policy-making position. As a group, they should be called the Conflict of Interest Network (COIN). They include: 1. A Secretary of Labor (Andrew Puzder), CEO of the company that operates Carl's Jr. and Hardee's restaurants, who hates workers, unions, the minimum wage, and worker safety laws and whose company was found guilty (by the DOL) of labor violations - including wage theft offenses, such as failing to pay the minimum wage or overtime - in 60% of its inspections at these two fast food chains. 2. A Secretary of Education (Betsy DeVos) who opposes public education and has spent hundreds of millions of dollars promoting private charter schools. 3. An EPA director (Scott Pruitt) who, as Oklahoma Attorney General, sued the EPA to help oil companies and who doesn't believe climate change is real 4. A Secretary of HUD (Ben Carson) who believes that government efforts to end racial discrimination is a form of socialism and who made a fortune shilling for a scam diet supplement company. 5. A Secretary of State (Rex Tillerson, CEO of Exxon Mobil) who has made billions by endangering the planet with fossil fuels and is good friends with the leader of country (Russia) that interfered with the U.S. election. 6. A national security advisor (Michael Flynn) who was fired as director of the Defense Intelligence Agency, has promoted what the New York Times called "unsubstantiated claims about Islamic law's spreading in the United States and about the attack on the American diplomatic compound in Benghazi, Libya, ." has profited from his work for defense contractors, and whose penchant for lying led his one-time employees at the DIA to identify his falsehoods as "Flynn facts." 7. A director of the National Economic Council (Gary Cohn) who is president of Goldman Sachs, a bank that helped bring down the economy with reckless and risky lending practices. 8. A Secretary of the Treasury (Steve Mnuchin) who, as head of OneWest Bank, engaged in racial discrimination, foreclosed on tens of thousands of innocent homeowners, and preyed on senior citizens. He used his political connections to purchase the bank throught a sweetheart deal with the federal government. Judges and government regulators criticized OneWest for its predatory practices. He's soon be in charge of dismantling the Consumer Financial Protection Bureau. 9. A Secretary of Commerce (Wilbur Ross) who "made a fortune purchasing bankrupt businesses and flipping them for a profit," according to Forbes, and who owned a coal mining company that responsible for the deaths of 12 coal miners who suffocated after an explosion at its Sago coal mine in West Virginia mine that had a history of safety violations. Earlier this year, his private equity firm, WL Ross & Co. agreed to pay a $2.3 million fine to the Securities and Exchange Commission for failing to properly disclose fees it charged investors. 10. An Attorney General (Jefferson Beauregard Sessions III), Senator from Alabama, who was rejected for a federal judgeship by the Senate because of his racist views. He once called the NAACP "un-American" and "Communist-inspired" and that he thought the KKK was "OK until I found out they smoked pot." He is against any form of immigration reform, is pro-life, opposes the Voting Rights Act, and opposes same-sex marriage. 11. A Budget Director (Cong. Mick Mulvaney of South Carolina) who is an member of the extremist Freedom (Tea Party) Caucus and, according to the New York Times, "a fierce advocate of deep spending cuts." 12. A Secretary of Enegy (Rick Perry) who in 2012 wanted to eliminate the Department of Energy (but, "oops," forgot its name), never saw an oil well he didn't love and who, as Texas guv, was an outspoken climate change denier and a fierce champion of the oil and gas industry, from whom he raised more than $11 million from 1998 to 2010. 13. A senior White House advisor (Steve Bannon), an outrageous anti-Semite and former Goldman Sachs banker who, as head of the right-wing extremist website Breitbart News, promoted white supremacists, anti-Muslim hate mongers, anti-Semites, nativists, and misogynists. 14. A Secretary of Health and Human Services (Cong. Tom Price of Georgia) who opposed the popular Children's Health Insurance Program, which insures eight million children, calling it "government-run socialized medicine." He wants to privatize Medicare. He's opposed to abortion and same-sex marriage. He'll be put in charge of dismantling the Affordable Care Act. 15. A Secretary of Defense (General James Mattis) whose nicknames are "Warrior Monk" and "Mad Dog," and who said that it is "a hell of a lot of fun to shoot" people and "Actually, it's a lot of fun to fight. You know, it's a hell of a hoot. I'll be right up front with you. I like brawling." 16. A Secretary of Transportation (Elaine Chao) who made $1.2 million as a director of Wells Fargo Bank during the period the company admitted to creating millions of fake customer accounts. She served as President George W. Bush's fiercely anti-union labor secretary. When she left government, she joined the boards of Rupert Murdoch's News Corp., Ingersoll-Rand Co., and Vulcan Materials as well as Wells Fargo. She was clearly chosen because she's the wife of Senate Majority Leader Mitch McConnell, who Trump will need to translate his crazy ideas into legislation, including his infrastructure program (written by Commerce Secretary Ross) that is a corporate welfare scam to give tax breaks to private businesses to build roads and bridges. As a group, they could be the board of directors of the Heritage Foundation, the Cato Institute, Bob Jones University, and the White Citizens Council. Peter Dreier is professor of politics and chair of the Urban & Environmental Policy Department at Occidental College. His most recent book is The 100 Greatest Americans of the 20th Century: A Social Justice Hall of Fame (Nation Books) -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.
Vulcan Materials Company is the largest producer in the United States of construction aggregates, asphalt mix, and ready-mixed concrete. The Birmingham, Ala.-based company has benefited from public construction projects including highways, bridges, airports, schools, and buildings.government funded projects, as well as from private industry demands. Additionally, its calcium operations provide [...]
Housing starts climbed 25.5% in October as builders ramped up construction of both single and multi-family homes
D.R. Horton Inc. (DHI) is scheduled to report fourth-quarter fiscal 2016 results on Nov 8, before the opening bell.