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Steve Hach is the Senior Editor at ValuEngine.com, a Melbourne, Florida-based stock valuation and forecast service. ValuEngine utilizes Ivy League financial research as the basis for its coverage of more than 8000 US, Canadian, and other foreign stocks. Hach utilizes ValuEngine's complex... More
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  • Facebook, THE Social Network?

    VALUATION WATCH: Overvalued stocks now make up 51.86% of our stocks assigned a valuation and 19.67% of those equities are calculated to be overvalued by 20% or more. Nine sectors are calculated to be overvalued--with three at or near double digits.

    --Facebook, THE Social Network? Facebook Beats Expectations With Good Quarter

    Facebook Inc. (NASDAQ:FB) operates a social networking website worldwide. The Company's products for users are free of charge and available on the Web, mobile Web, and mobile platforms, such as Android and iOS. Its website enables users to connect, share, discover, and communicate with each other. The Facebook Platform is a set of tools and application programming interfaces that developers can use to build social apps on Facebook or to integrate their Websites with Facebook. It offers products that enable advertisers and marketers to engage with its users. Facebook Inc. is headquartered in Menlo Park, California.

    Unlike the latest from Twitter we discussed yesterday, Facebook reported a far brighter earnings and growth picture with its earnings for Q2. Facebook exceeded Wall St. expectations AND maintained good user-base growth. For the quarter, revenue rose 39% to $4.04 billion--up from $2.91 billion a year ago. Net income was $719 million, or $0.25/share, compared to $0.30/share a year ago. The company reported a profit of $0.50/share, which beat analyst estimates of $0.47/share.

    The company's "monthly active users" (MAU) in this quarter totaled 1.49 billion, and increase of 13% year-over-year. Increases in users were within that range in all categories. Those are the sort of numbers advertisers like to see, and the company's advertising revenues increased accordingly--43% year-over-year.

    Analysts note that the company growth and associated revenues have scaled up nicely, and its rate of growth is similar to Google's when it was at its height. Mobile growth has been very strong, and the stock price has responded in kind. Facebook's performance stands in stark contrast to Twitter and other sites along the same "flight path"--such as Yelp.

    Despite this growth, our forecasts remain a bit flat long term. This may change as price movements are digested and analysts increase their earnings estimates moving forward. Facebook is expected to begin to monetize Instagram, the popular photo sharing site, and if it can duplicate its success there, then revenues could dramatically increase as well.

    For now, ValuEngine continues its HOLD recommendation on FACEBOOK INC-A for 2015-07-29. Based on the information we have gathered and our resulting research, we feel that FACEBOOK INC-A has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Price Sales Ratio.

    Below is today's more extensive data on FB:


     

     

     

     

     

     

    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month96.79-0.20%
    3-Month96.44-0.57%
    6-Month97.300.32%
    1-Year94.64-2.43%
    2-Year113.4616.99%
    3-Year77.68-19.91%

     















    Valuation & Rankings
    Valuation17.47% overvaluedValuation Rank(?) 23
    1-M Forecast Return-0.20%1-M Forecast Return Rank 35
    12-M Return31.58%Momentum Rank(?) 88
    Sharpe Ratio0.75Sharpe Ratio Rank(?) 85
    5-Y Avg Annual Return34.50%5-Y Avg Annual Rtn Rank 96
    Volatility45.70%Volatility Rank(?) 37
    Expected EPS Growth35.59%EPSGrowth Rank(?) 70
    Market Cap (billions)271.28Size Rank 100
    Trailing P/E Ratio82.19Trailing P/E Rank(?) 31
    Forward P/E Ratio60.62Forward P/E Ratio Rank 6
    PEG Ratio2.31PEG Ratio Rank 19
    Price/Sales20.08Price/Sales Rank(?) 6
    Market/Book17.25Market/Book Rank(?) 7
    Beta0.48Beta Rank 74
    Alpha0.22Alpha Rank 87

    Jul 30 12:31 PM | Link | Comment!
  • ValuEngine Top-Five Upgrades For The Day

    VALUATION WATCH: Overvalued stocks now make up 56.35% of our stocks assigned a valuation and 20.49% of those equities are calculated to be overvalued by 20% or more. Eleven sectors are calculated to be overvalued--five by double digits.

    Top Upgrades

    --ValuEngine Top-Five Upgrades for the Day

    ValuEngine tracks more than 7000 US equities, ADRs, and foreign stock which trade on US exchanges as well as @1000 Canadian equities. When EPS estimates are available for a given equity, our model calculates a level of mispricing or valuation percentage for that equity based on earnings estimates and what the stock should be worth if the market were totally rational and efficient--an academic exercise to be sure, but one which allows for useful comparisons between equities, sectors, and industries. Using our Valuation Model, we can currently assign a VE valuation calculation to more than 2800 stocks in our US Universe.

    We also use trading data to provide forecast estimates for a variety of time horizons for almost ever equity in our database. Our Buy/Sell/Hold recommendations are based upon the 1-year forecast return figure. Using valuation and forecast figures, you can rank and rate our covered stocks against each other, to find out, in an objective and systematic way, the most attractive investment targets based on your own risk/reward parameters. We re-calculate the entire database every trading day, so you are assured that every proprietary valuation and forecast datapoint is as up-to-date as possible.

    Below, we present the latest top-five list of 5-Engine STRONG BUY upgraded stocks from our models. They are ranked according to their one-year forecast figures. These stocks represent the "best of the best."

    Here are the brand new STRONG BUY upgrades for the day:

     

     

     

     

     

     

    TickerCompany NameMarket PriceValuationLast 12-M Return1-M Forecast Return1-Yr Forecast ReturnP/E RatioSector Name
    BBWBUILD-A-BEAR WK16.03-16.77%27.42%1.25%15.00%13.58Retail-Wholesale
    PLUSEPLUS INC75.35-1.57%31.09%1.18%14.22%13.29Computer and Technology
    CHLCHINA MOBLE-ADR62.66N/A27.36%1.11%13.35%13.97Computer and Technology
    HTHHILLTOP HLDGS23.711.78%9.41%1.09%13.10%11.08Finance
    OCIROCI RESOURCES25.4N/A-0.16%1.03%12.36%10.58Basic Materials

    Below is today's more extensive data on BBW:

    VALUENGINE RECOMMENDATION: ValuEngine updated its recommendation from BUY to STRONG BUY for BUILD-A-BEAR WK on 2015-07-06. Based on the information we have gathered and our resulting research, we feel that BUILD-A-BEAR WK has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE P/E Ratio and Price Sales Ratio.


     

     

     

     

     

     

    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month16.211.09%
    3-Month16.02-0.05%
    6-Month16.070.25%
    1-Year18.1413.15%
    2-Year14.44-9.92%
    3-Year12.62-21.28%

     















    Valuation & Rankings
    Valuation19.78% undervaluedValuation Rank(?) 85
    1-M Forecast Return1.09%1-M Forecast Return Rank 99
    12-M Return14.01%Momentum Rank(?) 74
    Sharpe Ratio0.35Sharpe Ratio Rank(?) 65
    5-Y Avg Annual Return17.16%5-Y Avg Annual Rtn Rank 82
    Volatility48.90%Volatility Rank(?) 33
    Expected EPS Growth19.49%EPSGrowth Rank(?) 58
    Market Cap (billions)0.28Size Rank 48
    Trailing P/E Ratio13.58Trailing P/E Rank(?) 82
    Forward P/E Ratio11.37Forward P/E Ratio Rank 79
    PEG Ratio0.70PEG Ratio Rank 55
    Price/Sales0.72Price/Sales Rank(?) 76
    Market/Book2.78Market/Book Rank(?) 41
    Beta1.27Beta Rank 35
    Alpha0.11Alpha Rank 78

    Tags: BBW, PLUS, CHL, HTH, OCIR, upgrades
    Jul 07 3:47 PM | Link | Comment!
  • BP Settles With US Government And Gulf States

    VALUATION WATCH: Overvalued stocks now make up 61.71% of our stocks assigned a valuation and 25.81% of those equities are calculated to be overvalued by 20% or more. Fifteen sectors are calculated to be overvalued--eight by double digits.

    --We're Sorry... Really Sorry BP Settles With US Government and Gulf States

    BP p.l.c. is the holding company of one of the world's largest petroleum and petrochemicals groups. Their main activities are exploration and production of crude oil and natural gas; refining, marketing, supply and transportation; and manufacturing and marketing of petrochemicals. They have a growing activity in gas and power and in solar power generation. BP has well-established operations in Europe, North and South America, Australasia and Africa.

    The media are reporting today that BP has reached a settlement related to damages associated with the massive 2010 Gulf of Mexico oil spill. Details have not yet been released, but according to Bloomberg, press conferences are scheduled for this morning by the Attorney Generals of states effected by the spill--Louisiana, Mississippi, Alabama, and Florida.

    The 2010 spill was a disaster for the Gulf and BP's reputation, exposing lax safety practices and a seeming lack of concern on the part of the firm and CEO Tony Hayward. Hayward's legendary "Sorry" speech, which was a PR disaster, led to his widespread ridicule and eventual resignation.

    Since then, the company has spent almost $30 billion on clean up and associated costs--out of a war chest of @$44 billion. But, the company has been fighting claims along the way and trying to avoid big payouts to states and cities under the US federal Oil Pollution Act.

    BP was an interesting case from a quant research perspective, because as shareholders dumped the stock, the price dived yet earnings as calculated by analysts remained the same. So, it actually looked more attractive to computer-based stock forecasting and valuation models.

    Angry environmentally-conscious investors berated firms who ranked the BP a BUY despite the milions of barrels of oil pouring into the Gulf. This was yet another example of the fact that computers can only measure financial data, and until qualitative analysts adjusted earnings data to reflect the liabilities associated with the spill, a true picture of the company's health was impossible to obtain. The stock has never returned to where it was before the spill, and is currently up @23% from the low it hit in June, 2010--although it had been up from the low almost 70% in July, 2014

    Below is today's more extensive data on BP:

    VALUENGINE RECOMMENDATION: ValuEngine continues its HOLD recommendation on BP PLC for 2015-06-30. Based on the information we have gathered and our resulting research, we feel that BP PLC has the probability to ROUGHLY MATCH average market performance for the next year. The company exhibits ATTRACTIVE Company Size but UNATTRACTIVE Earnings Growth Rate.


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month40.080.31%
    3-Month40.872.28%
    6-Month41.413.63%
    1-Year41.433.68%
    2-Year39.15-2.03%
    3-Year45.5313.93%

     















    Valuation & Rankings
    Valuation1.64% overvaluedValuation Rank(?) 59
    1-M Forecast Return0.31%1-M Forecast Return Rank 74
    12-M Return-20.79%Momentum Rank(?) 28
    Sharpe Ratio-0.02Sharpe Ratio Rank(?) 42
    5-Y Avg Annual Return-0.71%5-Y Avg Annual Rtn Rank 41
    Volatility32.50%Volatility Rank(?) 54
    Expected EPS Growth-27.64%EPSGrowth Rank(?) 11
    Market Cap (billions)121.44Size Rank 100
    Trailing P/E Ratio12.18Trailing P/E Rank(?) 87
    Forward P/E Ratio16.84Forward P/E Ratio Rank 49
    PEG Ration/aPEG Ratio Rank n/a
    Price/Sales0.38Price/Sales Rank(?) 88
    Market/Book1.54Market/Book Rank(?) 63
    Beta1.97Beta Rank 13
    Alpha-0.38Alpha Rank 21

    Tags: BP, energy, oil
    Jul 02 9:30 AM | Link | Comment!
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