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Cisco, Tilray, Aurora Cannabis, Alibaba, Trade Talks – 5 Things You Must Know

Here are five things you must know for Wednesday, May 15:

1. — Stock Futures Lower Amid Subsiding Trade War Worries

U.S. stock futures were lower Wednesday though sentiment was lifted by a softening of the rhetoric from Donald Trump in the U.S.-China trade war and suggestions that talks could resume in the coming weeks.

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Markets also were soothed by weaker-than-expected economic data from China that pointed to not only slowing growth in the world’s second-largest economy but also a weakening bargaining position in Beijing’s trade standoff with Washington.

With Trumps describing the dispute with China as “a little squabble” on Tuesday, as well as confirmation from the U.S. Treasury that Secretary Steven Mnuchin will soon travel to Beijing to resume trade talks, markets were happy to add risk following Tuesday’s gains on Wall Street.

Contracts tied to the Dow Jones Industrial Average fell 85 points, futures for the S&P 500 declined 8.70 points, and Nasdaq futures were down 23 points.

The economic calendar in the U.S. Wednesday includes Retail Sales for April at 8:30 a.m. ET, the Empire State Manufacturing Survey for May at 8:30 a.m., Industrial Production for April at 9:15 a.m., and Oil Inventories for the week ended May 10 at 10:30 a.m.

2. — Cisco, Alibaba and Macy’s Report Earnings Wednesday

Alibaba Group Holding (BABAGet Report)  posted stronger-than-expected fiscal fourth-quarter earnings as consumer growth on its online marketplace surged and its tie-up with Starbucks (SBUXGet Report) , the world’s biggest coffee chain, helped boost revenue and its cloud computing sales surged.

Macy’s (MGet Report)  earned 44 cents a share on an adjusted basis in the first quarter, higher than estimates of 33 cents. Same-store sales rose 0.7% in the quarter vs. estimates that called for a decline of 0.6%.

Earnings reports are also expected Wednesday from Cisco Systems (CSCOGet Report) and Jack in the Box (JACKGet Report) .

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3. — Tilray Rises After Revenue Beat, Aurora Cannabis Slumps

Tilray  (TLRY) shares were rising 4% to $50.71 in premarket trading Wednesday after the Canadian cannabis company posted stronger-than-expected first-quarter sales, while its domestic rival Aurora Cannabis (ACBGet Report) slumped after revenue missed analysts’ forecasts amid caps on retail store growth in the Canadian market.

Tilray said first-quarter revenue rose 195% from a year earlier to $23 million, as sales in Canada surged following the country’s decision to legalize cannabis for recreational use. The adjusted loss in the quarter was 27 cents a share, wider than analysts’ estimates, after a 5.7% drop in the average price per kilogram sold.

CEO Brendan Kennedy also said Tilray was looking to further its partnerships with U.S. and international companies as the potential $150 billion global market for cannabis undergoes a generational change in both regulation and consumer acceptance.

“We’ve been inundated with contacts from Fortune 500 companies who are interested in exploring partnerships with Tilray,” Kennedy told investors on a conference call late Tuesday. “And it’s a range of companies from a broad variety of industries.”

“We’re also starting to have conversations with U.S. retailers who are interested in carrying CBD product in the second half of this year,” he added.

Aurora Cannabis, meanwhile, was tumbling 4.7% to $7.99 in premarket trading after its fiscal third-quarter revenue of C$75.2 million missed Wall Street forecasts of C$77.2 million and consumer cannabis sales were just under C$30 million as provincial regulators limited the number of retail outlets.

The company reported a loss attributable to shareholders in the quarter of $C158 million said Aurora Cannabis said it was “well positioned to achieve positive EBITDA beginning in fiscal Q4.”

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4. — Walmart Considering IPO for U.K. Unit Asda

Walmart (WMTGet Report) is considering an initial public offering for its U.K. grocery subsidiary Asda, a listing that that could value the company at as much as an estimated 8.5 billion pounds ($11 billion), Bloomberg reported.

The news comes just weeks after U.K. antitrust regulators blocked a planned merger between Asda, Britain’s fourth-largest supermarket, and rival J Sainsbury.

“While we are not rushing into anything, I want you to know that we are seriously considering a path to an IPO,” Judith McKenna, the company’s international chief, told employees at an event in Leeds, according to a summary of the event provided by Asda. Any preparations for going public would “take years,” she said, Bloomberg reported.

5. — Nelson Peltz’s Trian May Wage Activist Campaign at Legg Mason – Report

Nelson Peltz’s Trian Fund Management may wage an activist campaign at Legg Mason (LMGet Report) and push the mutual fund company to improve its flagging results, The Wall Street Journal reported, citing people familiar with the matter.

It would be the second time in 10 years that Trian has targeted the mutual fund company, according to Reuters.

Trian recently has held discussions with Legg Mason about the need to cut costs and improve profit margins, the people told the Journal. The two sides may still negotiate a settlement that sidesteps a proxy fight, the sources added.

On a conference call with analysts Monday, Legg Mason CEO Joseph Sullivan said the company was moving to slash expenses.

“While there is much work to be done, we now have increased visibility into and have gained even greater confidence in our ability to deliver $100 million or more of annual savings now within two years,” he said.

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Source: Cisco, Tilray, Aurora Cannabis, Alibaba, Trade Talks – 5 Things You Must Know

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Stock Market Correction – 4 Crucial Steps To Position Your Watch List And Portfolio

Many investors are scratching their heads when it comes to positioning the portfolio in the stock market correction. However, we think that there are four crucial steps that every investor should take into an account. Without further ado, let’s see these steps.

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Stock Market Correction – 4 Crucial Steps To Position Your Watch List And Portfolio

Analyze the Stock Market

Before anything, you should analyze the stock market conditions. The reason for this is that many stocks tend to move in the same direction as the stock market. A stock market correction by the vertical violation or slice below the 50-day line tend to have a very high failure rate for the follow-through day.

Furthermore, the market is, for the big part, driven by news. The investors should always have their mind opened for the new stock market uptrend.

Hedge Your Portfolio

You should manage your trades like a portfolio. After the market turn in the Q4 2018 market correction, IBD’s team added ProShares UltraPro S&P 500 (UPRO). Thanks to this decision, the risk levels were managed against the S&P 500. Let’s not forget that UPRO, when converted to an ETF, corresponds to three times the daily performance of the S&P 500.

Utilize Swing Trading

IBD is constantly scanning for new ideas for its SwingTrader platform. This can be quite an efficient method. For example, we had seven names on the IBD’s swing trading list in September 2018. But, by the end of the month, there weren’t any quality stocks. If the pickings are slim, the general rule is that stock market conditions are weakening.

Make a Watchlist

Finally, make your own watchlist. You need to be able to spot the top stocks and then add them to the watchlist. When you do that, you’ll be able to monitor your selected stocks and carefully choose which one to invest in.

Source: https://www.investors.com/how-to-invest/stock-market-correction-watchlist-portfolio/

Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.

Source: Stock Market Correction – 4 Crucial Steps To Position Your Watch List And Portfolio – stock market correction 2019, stock market correction 2018

What Is the Best Time to Invest in Stocks? – How to Buy and Sell Stocks

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The worst of times in the market, or at least when it appears that things couldn’t go further below from that point, might actually be the best time to buy stocks and start investing.

We often forget that people actually tend to buy everything when it drops below its original price – think about discounted items in the grocery store for instance – you would rather buy products from your grocery list on a discount, but not the stocks?

This might be a mistake and there are several reasons why.

Table of Contents

Buy Stocks When Below Their Highs – When Is the Best Time to Invest in Stocks?

Ideally, you will decide to buy a stock you are holding interest in when the stock falls below its monthly, quarterly or yearly high, because you will make a profit once the stock starts to show signs of rebounding.

However, perhaps the most ideal time to buy a stock is when the stock comes near -20% below its high price – in addition, you need to make sure that the stock has a proven historical record that supports the theory that the stock won’t go far from -20% dip before it takes a rebound.

Invest in High Beta Scores for Top ROI

Almost as by a rule, whenever a stock that has benevolent, or high, beta score, drops below its initial high value, that same stock tends to take an upward turn against the downside trend.

This behavior should result in flattering returns; however, you need to note that sometimes you need to be patient when buying high beta stocks at lows.

Learn How to Trim Your Stock Positions

Trimming can be a rather favorable strategy for generating more cash through your ROI. You can for example take a quarter or the fifth of the stock you own, you may take tenth even if you will, and sell it when you see a rebound.

You use that cash later on to buy more stocks in that position when the stock hits another low, repeating the process based on the market trends in order to generate cash.

Disclaimer: The information on this site is provided for discussion purposes only, and should not be misconstrued as investment advice. Under no circumstances does this information represent a recommendation to buy or sell securities.

Source: What Is the Best Time to Invest in Stocks? – How to Buy and Sell Stocks

Stock Market Vs. Real Estate: The Right Approach For Passive Income Investors

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For new and hopeful passive investors, most of the accessible information on the topic of the stock market versus real estate presents widely varying opinions and tends to over complicate things by assuming you have a solid education in both fields. Rather than feeling informed, this type of guidance tends to leave you in a state of confusion.

For newcomers to the debate of real estate or the stock market, I prefer to share an oversimplification of the subject to ensure you can capture the basics, providing enough information so you can start asking better questions as you embark on an investing path.

First, I am assuming that you want to grow your retirement funds in a safe investment that will produce decent returns. Second, I am assuming you are busy and don’t have the time to gain the in-depth knowledge and experience needed to actively trade or invest in the stock market or real estate and are rather looking for simple solutions.

When it comes to your retirement and the stock market, the most common passive investments are mutual funds. If you’re fortunate enough to average a 10% return on your investments and then you factor in inflation and fees, your eventual return may be lower than anticipated.

In real estate, your passive opportunities are in private lending and rental properties. Private lending commonly involves lending funds to a real estate investor or business in exchange for a set return and length of time. (Full disclosure: I am co-partner of a turnkey investment company.) Turnkey rental properties allow the investor to be as hands-off as they like. This means a turnkey company purchases, rehabs, tenants and manages the property. To truly make this a passive investment, turnkey companies do all the work for you.

Here’s what several key factors of a passive investment looks like in real estate and the stock market:

Control: With the stock market, you are at the mercy of the fund and management. With private lending, you control who you invest with, the rate of return, the length of time you want to invest and approval of the asset your money is secured by. With rental properties, you are in control of what you buy, the improvements that will increase rents and what costs are passed onto the tenants, such as landscaping and shared utility expenses.

Tangible asset: With the stock market, you lack anything tangible. With private lending and rental real estate, your funds are secured by a physical asset.

Cash flow: With the stock market, if we hit a down cycle, your profits are instantly lost. In real estate, in any economic downturn, private lenders have up to 50% equity already built in, and investors with rental properties keep netting their monthly cash flow from their tenants despite the dip.

Leverage: With the stock market, you invest your retirement savings or cash on hand. The same is true for private lending. You can leverage rental properties four-to-one, sometimes five-to-one, meaning your $50,000 investment can buy you $200,000-250,000 in real estate. In a rising market, this is a good thing and will maximize your cash on cash return.

Tax advantages: If you purchased $50,000 in stock that is now worth $200,000, you will pay taxes on that amount when you sell it. Rental properties provide opportunities for multiple tax advantages such as depreciation, deductions and a 1031 Exchange.

Appreciation: You don’t get to factor in added appreciation when investing in the stock market or private lending, but you do with a tangible asset like rental real estate. When you bring together the advantage of real estate being tangible, there’s really no comparison for the passive investor.

The math: Assuming a $50,000, 15-year investment in the passive opportunities we’ve discussed in this article:

• A mutual fund investment averaging 10% returns after fees ends up at a 7% net annualized return = Almost $138,000 after 15 years.

• Private lending investment with no fees averaging 12% net annualized return = Over $273,000 after 15 years.

• A turnkey rental property investment leveraging your $50,000 to buy $200,000 in real estate, averaging 6% in net annualized return after expenses and 3% annual appreciation of the asset = Over $431,000 after 15 years.

Whether you’re investing for your approaching retirement or beginning your passive income approach well ahead of time, passive investing is for anyone who seeks true financial peace of mind and passive income. If you had $10,000 month coming in passively, what would you be doing today? You don’t have to be an active real estate investor to achieve your goals — but you do need to find passive ways to direct some of your money into real estate.

By: Dani Lynn Robison

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