Deutsche Bank’s John Inch and Karen Lau argue that Honeywell International (HON) is “achieving Asian critical mass.” They explain:
After over a decade of aggressive and earnest Asian investment including seed planting and cultivation of local Asian talent, we believe Honeywell has emerged from behind other western countries in China and the rest of Asia to leading position across its served markets. Honeywell claims (and we believe it is true) that it has become the Chinese/Asian competitor that local rivals look to emulate. Honeywells profit margins in China are above the corporate averages across the companys businesses. Meanwhile, we learned that Honeywell is sometimes even the local price leader, such as for scanning and mobility products.
Within China, we estimate Honeywells sales to be closing in on $2.8bn (6-7% of company total), roughly flat last year (dragged last year by PMTs down results due to the collapse in oil prices and associated project deferral), up low to mid single-digits this year (ACS is running up double-digits YTD) and up double-digits next year (and beyond). As part of the $2.8bn, the company reportedly has realized ~$750mm in sales that it classifies as East for East (E4E) developed and produced almost entirely in local markets for local customers (i.e., ACS and turbo with some PMT product applications). We believe the $750mm to be a laudable achievement particularly given the rapid pace of change of Chinas economy over the past decade coupled with aggressive local competition. Honeywell retains #1/#2 positions across a swath of the markets it serves.
Hot Up And Coming Companies To Invest In Right Now: DragonWave Inc(DRWI)
DragonWave Inc. (DragonWave) is a provider of packet microwave solutions for Internet protocol (IP) networks. The Company operates through broadband wireless backhaul equipment segment. The principal application of DragonWave’s products is mobile network backhaul. Additional applications include leased line replacement, last mile fiber extension and enterprise networks. The Company’s product lines include Harmony, Horizon, Avenue and NetViewer. The Harmony product line is a multi-service wireless platform enabling time division multiplexing (TDM) and packet-based services across wireless or wireline infrastructure. The Company’s Horizon product family is an Ethernet microwave portfolio and consists of Horizon Compact+ and Horizon Quantum. Its NetViewer is a multi-service, multi-product network management platform. The NetViewer enables provisioning, management, monitoring and configuration across the line of products in a single graphical user interface (GUI)-based system. Advisors’ Opinion:
- [By Monica Gerson]
DragonWave (NASDAQ: DRWI) dropped 17% to $2.05 after the company priced US$25 million public offering of units.
SmartPros (NASDAQ: SPRO) dropped 11.82% to $1.79. SmartPros’ trailing-twelve-month ROE is -16.31%.
Hot Up And Coming Companies To Invest In Right Now: Marsh & McLennan Companies, Inc.(MMC)
Marsh & McLennan Companies, Inc., a professional services firm, provides advice and solutions in the areas of risk, strategy, and people worldwide. It operates through two segments, Risk and Insurance Services; and Consulting. The Risk and Insurance Services segment offers risk management services, such as risk advice, risk transfer, risk control, and mitigation solutions, as well as insurance, reinsurance broking, catastrophe and financial modeling services, and related advisory services. This segment serves businesses, public entities, insurance companies, associations, professional services organizations, and private clients. The Consulting segment provides health, retirement, talent, and investments consulting services and products; and specialized management, and economic and brand consulting services. This segment assists public and private sector employers in the design, management, and administration of employee health care programs; provides a range of strategic and compliance-related retirement services and solutions to corporate, governmental, and institutional clients; advises organizations on the engagement, management, and rewarding of employees; and offers investment consulting and other services to the sponsors of pension funds, foundations, endowments, other investors, and wealth management companies. Marsh & McLennan Companies, Inc. was founded in 1871 and is headquartered in New York, New York.
- [By Reuters]
Wendy Maeda/The Boston Globe via Getty Images NEW YORK — Walgreen is moving 120,000 employees to a private health insurance exchange from coverage provided directly from carriers, the company will announce Wednesday. The pharmacy chain will join 17 other large employers on the Aon Hewitt Corporate Health Exchange as part of a growing movement to offer employees fixed dollar amounts to purchase their own plans on such exchanges. The end-cost to employees depends on the plan chosen, but they typically get more options than under traditional arrangements. Private exchanges mimic the coverage mandated as part of the Affordable Care Act. Enrollment in the public exchanges starts Oct. 1. “What happens to employer contributions over time? Will they put in as much as they put in the past? These are unanswered questions but potential negatives,” says Paul Fronstin, a senior research associate with the Employee Benefit Research Institute. The benefit to Walgreen and other employers is unknown at this point, as their cost-savings aren’t clear. Of the 180,000 Walgreen (WAG) employees eligible for health care insurance, 120,000 opted for coverage for themselves and 40,000 family members. Another 60,000 employees, many of them working part-time, weren’t eligible for health insurance. Aon Hewitt (AON) says other participants in its program include retailer Sears Holding (SHLD) and Darden Restaurants (DRI). These new additions raise enrollment to 330,000 from 100,000 last year, and Aon Hewitt estimates enrollment will jump to 600,000 next year, a fivefold increase from 2012. By 2017, nearly 20 percent of employees nationwide could get their health insurance through a private exchange, according to Accenture Research (ACN). A recent report by the National Business Group on Health said that 30 percent of large employers are considering moving active employees to exchanges by 2015. Other major providers of private exchanges include Mercer, a division of Marsh & Mc
Top 5 Diversified Bank Stocks To Buy For 2017: Baker Hughes Incorporated(BHI)
Baker Hughes Incorporated supplies oilfield services, products, technology, and systems to the oil and natural gas industry worldwide. The company offers drilling and evaluation products and services, which include drill bits for performance drilling, hole enlargement, and coring; conventional and rotary steerable systems used to drill wells; measurement-while-drilling and logging-while-drilling systems to perform reservoir navigation services; drilling optimization services; tools for coil tubing drilling and wellbore re-entry systems; coring drilling systems; surface logging; emulsion and water-based drilling fluids systems; reservoir drill-in fluids; and fluids environmental services. Its drilling and evaluation products and services also comprise wire line services, such as tools for open hole and cased hole well logging to gather data to perform petro physical and geophysical analysis; reservoir evaluation coring; casing perforation; fluid characterization; production logging; well integrity testing; pipe recovery; and seismic and micro seismic services. In addition, the company provides completion and production products and services consisting of completion systems used to control the flow of hydrocarbons within a wellbore; wellbore intervention products and services to enhance the performance of existing wellbores; intelligent production system products and services to monitor and control the production from individual wells or fields; artificial lifts, such as electric submersible pump systems, progressing cavity pump systems, gas lift systems, and surface horizontal pumping systems to lift oil and water; chemicals and chemical application systems; and cementing, stimulation, and coil tubing services. Further, it offers industrial products and services to the downstream chemicals, and process and pipeline industries. The company was founded in 1972 and is headquartered in Houston, Texas.
- [By Ben Levisohn]
A Structural Favorite. Halliburton remains one of our favorite stocks in the group and the management team’s relentless pursuit of efficiency and aggressive positioning for the upcycle will likely make the stock one of the top performers in the OFS space. Within the diversified peer group, we believe Halliburtonis best positioned to benefit from the unfolding increase in oilfield services activity in North America, as it remains markedly more levered to North America compared to its competitors. Once the recovery (which is already in a nascent stage) further takes hold, NAM activity will react the quickest and the strongest, which should allow Halliburtonto see higher company-wide revenue growth and margin expansion than its peers. Internationally, and following Baker Hughes’ (BHI) decision to exit some international markets and product lines, we expect the international dominance of Halliburtonand Schlumberger (SLB) (which allowed for +20% margins pre-20 09) to return, with Halliburtonas the primary beneficiary of market share gains and better pricing. In anticipation of the upturn, the company continues to execute and gain market share through the downturn. We see a path to $4.00+ in EPS and a $60+ stock price in the not too distant future.
- [By Ben Levisohn]
It’s a deal made for late-night television. Last night, the Wall Street Journal reported that General Electric (GE) was considering buying Baker Hughes (BHI). General Electric denied the news immediately, saying simply that it was considering joint ventures with Baker Hughes. Baker Hughes, meanwhile, has confirmed there are talks but “no guarantee anything will be included.” Now, it appears that the discussion is about combining General Electric’s oil and gas business with Baker Hughes. Citigroup’s Scott Gruber and Andrew Kaplowitz offer their thoughts:
Hot Up And Coming Companies To Invest In Right Now: Bank of the Ozarks(OZRK)
Bank of the Ozarks, Inc., incorporated on June 15, 1981, is a bank holding company. The Company owns an Arkansas state chartered subsidiary bank, Bank of the Ozarks (the Bank). The Company, through the Bank, conducts operations through approximately 257 offices, including over 80 offices in Arkansas, approximately 30 in Georgia, over 20 in North Carolina, over 20 in Texas, approximately 44 in Florida, over three in Alabama, approximately two each in South Carolina and New York and one in California. It owns Ozark Capital Statutory Trust II, Ozark Capital Statutory Trust III, Ozark Capital Statutory Trust IV and Ozark Capital Statutory Trust V (collectively, the Ozark Trusts). It owns Intervest Statutory Trust II, Intervest Statutory Trust III, Intervest Statutory Trust IV and Intervest Statutory Trust V (collectively, the Intervest Trusts, and together with the Ozark Trusts, the Trusts).
The Company provides a range of retail and commercial banking services. Its deposit services include checking, savings, money market, time deposit and individual retirement accounts. Its loan services include various types of real estate, consumer, commercial, industrial and agricultural loans and various leasing services. It also provides mortgage lending; treasury management services for businesses, individuals and non-profit and governmental entities, including wholesale lock box services; remote deposit capture services; trust and wealth management services for businesses, individuals and non-profit and governmental entities, including financial planning, money management, custodial services and corporate trust services; real estate appraisals; automated teller machines (ATMs); telephone banking; online and mobile banking services, including electronic bill pay and consumer mobile deposits, and debit cards, gift cards and safe deposit boxes, among other products and services. Through third-party providers, it offers credit cards for consumer s and businesses, processing of merchant debit and credit ca! rd transactions, and full-service investment brokerage services.
The Company’s loan portfolio includes purchased loans, such as various types of real estate loans, consumer loans, commercial and industrial loans, agricultural loans and other types of loans. Its portfolio of real estate loans includes loans secured by residential one- to four-family, non-farm/non-residential, agricultural, construction/land development, multifamily residential properties and other land loans. Non-farm/non-residential loans include those secured by real estate mortgages on owner-occupied commercial buildings of various types, leased commercial, retail and office buildings, hospitals, nursing and other medical facilities, hotels and motels, and other business and industrial properties. Agricultural real estate loans include loans secured by farmland and related improvements, including some loans guaranteed by the Farm Service Agency. Real estate cons truction/land development loans include loans secured by vacant land, loans to finance land development or construction of industrial, commercial, residential or farm buildings or additions or alterations to existing structures. Its residential one- to four-family loans include home equity lines of credit.
The Company’s portfolio of consumer loans includes loans to individuals for household, family and other personal expenditures. Its commercial and industrial loan portfolio consists of loans for commercial, industrial and professional purposes, including loans to fund working capital requirements (such as inventory, floor plan and receivables financing), purchases of machinery and equipment and other purposes. It offers a range of commercial and industrial loan arrangements, including term loans, balloon loans and lines of credit, including some loans guaranteed by the Small Business Administration, with the purpose and collateral supporting a particular loan d etermining its structure. Its portfolio of agricultural (non! -real est! ate) loans includes loans for financing agricultural production, including loans to businesses or individuals engaged in the production of timber, poultry, livestock or crops. As of December 31, 2015, its loans and leases included a total of $8.33 billion.
The Company classifies its investment securities portfolio as available for sale. Its investment securities include obligations of states and political subdivisions, the United States Government agency securities, corporate obligations, the Community Reinvestment Act (CRA) qualified investment fund and other equity securities. As of December 31, 2015, the Company’s investment securities totaled to a fair value of $602.3 million.
Sources of Funds
The Company offers an array of deposit products consisting of non-interest bearing checking accounts, interest bearing transaction accounts, business sweep accounts, savings accounts, money market accounts, t ime deposits, including access to products offered through the various CDARS programs, and individual retirement accounts. As of December 31, 2015, its total deposits were $7.97 billion.
- [By Lisa Levin]
Bank Of The Ozarks Inc (NASDAQ: OZRK) reported better-than-expected earnings for its second quarter on Monday.
Bank of the Ozarks disclosed net income of $54.5 million for the second quarter compared to $44.8 million representing an increase of 21.7 percent. On a per share basis, earnings grew 17.6 percent to $0.60 from $0.51 in the year-ago quarter. This was higher by a penny from the Street analysts' expectations.
Hot Up And Coming Companies To Invest In Right Now: Hatteras Financial Corp(HTS)
Hatteras Financial Corp. operates as an externally-managed mortgage real estate investment trust (REIT) in the United States. It invests primarily in single-family residential mortgage real estate assets, such as mortgage-backed securities (MBS), mortgage servicing rights (MSR), residential mortgage loans, and other financial assets. The companys MBS are pass-through securities comprising a pool of mortgage loans, which issued or guaranteed by the United States Government agency or by the United States Government-sponsored enterprise. It also acquires, invests in, securitizes, and manages non-agency mortgage loans; and operates as a broker-dealer. The company has elected to be taxed as a REIT under the Internal Revenue Code of 1986, and would not be subject to Federal income tax to the extent that it distributes 100% of its taxable income. Hatteras Financial Corp. was incorporated in 2007 and is based in Winston Salem, North Carolina.
- [By Ben Levisohn]
Hatteras Financial (HTS) has jumped 9.4% to $15.60 after agreeing to be purchased byAnnaly Capital Management (NLY) for $1.5 billion.Annaly Capital Management has dropped 1.1% to $$10.30.
Hot Up And Coming Companies To Invest In Right Now: Ashford Hospitality Trust Inc(AHT)
Ashford Hospitality Trust, Inc. is a publicly owned real estate investment trust. The firm engages in investment and management of properties in the hospitality industry. It invests in the real estate markets of the United States. The firm primarily invests in hotels with a focus on the ownership of upper-upscale and upscale full-service and select service hotels in primary, secondary and resort markets. It also invests in mid-scale and luxury hotels. The firm invests across all segments and at all levels of the capital structure, including direct hotel investments, first mortgages, mezzanine loans, construction loans, and sale-leaseback transactions. It primarily concentrates among Marriott, Hilton, Hyatt, and Starwood brands. Ashford Hospitality Trust, Inc. was founded in 1968 and is based in Dallas, Texas.
- [By Lisa Levin] Related AHT 25 Biggest Mid-Day Gainers For Friday Mid-Day Market Update: Hortonworks Drops Following Weak Results; Freshpet Shares Spike Higher Ashford Hospitality Trust's (AHT) CEO Montgomery Bennet on Q2 2016 Results – Earnings Call Transcript (Seeking Alpha) Related NEWS Mid-Morning Market Update: Markets Open Higher; Micron To Lower Jobs Mid-Morning Market Update: Markets Open Lower; Broadcom Profit Beats Expectations NewStar Financial's (NEWS) CEO Tim Conway on Q2 2016 Results – Earnings Call Transcript (Seeking Alpha)