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Steve Hach
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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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  • Rotten Apple?

    VALUATION WATCH: Overvalued stocks now make up 49.1% of our stocks assigned a valuation and 17.41% of those equities are calculated to be overvalued by 20% or more. Nine sectors are calculated to be overvalued--with two at or near double digits.

    --Rotten Apple? Apple Shares Enter Correction Territory

    Apple Inc. (NASDAQ:AAPL) is engaged in designing, manufacturing and marketing mobile communication and media devices, personal computers, and portable digital music players. The Company's products and services include iPhone, iPad, Mac, iPod, Apple TV, a portfolio of consumer and professional software applications, the iOS and Mac OS X operating systems, iCloud, and a range of accessory, service and support offerings. It sells its products worldwide through its online stores, its retail stores, its direct sales force, third-party wholesalers, and resellers. Apple Inc. is headquartered in Cupertino, California.

    It is rare to talk poorly of Apple shares, in fact, most of our discussions of the company are typically of the "fanboy" variety. We know about the category-leading products--indeed, Apple invented many of the categories! We know about the massive market cap--and the stock's resultant ability to move whole indices, the design wizards led by Jony Ive, the "can do no wrong" juggernaut of Cupertino, untouched by rumours of Asian sweatshops, bad wifi antennae, bendable cases, etc.

    And yet here we are: over the past few weeks the stock has shed lots of value, and is now down more than 10% since it released quarterly earnings in July. It is now pretty much flat for 2015. Sales of the "killer app" for Apple, as it were, the iPhone--responsible for more than 60% of the company's revenue, have not been quite as impressive as investors have come to expect.

    In addition, the jury is still out on the company's latest "must have" product-- that consumers did not even know they needed to have until Apple made it--the Apple Watch. Without mega growth in iPhones and a success with the Apple Watch, it is pretty much a given that the company will not be able to keep up its impressive record of growth and dominance.

    As we have noted in the past, Apple simply cannot continue to perform as it has because it is now far too large. The numbers just don't make sense when they get so big. How much cash can they keep on hand? How much of the market can they dominate in the face of cheaper Android phones, and--GASP-- a resurgent Microsoft with its latest OS release Windows 10?

    But, shares are not quite as expensive as they were the last time we saw a dip like this. They certainly have more room to fall but the company remains the one, the only, Apple after all. This may be just a temporary glitch. In the past, the stock has shed 10% or more on numerous occasions only to come roaring back stronger than ever--the last time this happened, in 2012, the shares lost almost half their value only to come back 200%.

    In addition, the company retains ample cash reserves to support the stock via a buy back program if they so desire. And, that new model iPhone is coming soon. If users leapfrog the iPhone 6 models for the newest and best smart phone from Cupertino, then the stock may shake off this correction and soar yet again.

    Betting against this company has been a bad move in the past, and dips were best considered to be buying opportunities. For now, our models remain enamored of the shares. ValuEngine continues its BUY recommendation on APPLE INC for 2015-08-04. Based on the information we have gathered and our resulting research, we feel that APPLE INC has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE Company Size and Sharpe Ratio.

    Below is today's more extensive data on AAPL:


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month115.801.02%
    3-Month116.551.67%
    6-Month118.093.01%
    1-Year128.6112.19%
    2-Year120.294.93%
    3-Year98.00-14.52%

     















    Valuation & Rankings
    Valuation0.99% undervaluedValuation Rank(?) 52
    1-M Forecast Return1.02%1-M Forecast Return Rank 98
    12-M Return19.93%Momentum Rank(?) 79
    Sharpe Ratio0.99Sharpe Ratio Rank(?) 93
    5-Y Avg Annual Return23.88%5-Y Avg Annual Rtn Rank 92
    Volatility24.09%Volatility Rank(?) 67
    Expected EPS Growth7.49%EPSGrowth Rank(?) 37
    Market Cap (billions)667.75Size Rank 100
    Trailing P/E Ratio13.01Trailing P/E Rank(?) 83
    Forward P/E Ratio12.11Forward P/E Ratio Rank 74
    PEG Ratio1.74PEG Ratio Rank 27
    Price/Sales2.98Price/Sales Rank(?) 32
    Market/Book5.71Market/Book Rank(?) 23
    Beta0.89Beta Rank 50
    Alpha0.16Alpha Rank 84

    ValuEngine.com is an independent research provider, producing buy/hold/sell recommendations, target price, and valuations on over 7,000 US and Canadian equities every trading day.
    Visit our website for more information and a free trial.

    Aug 06 10:42 AM | Link | Comment!
  • ValuEngine STRONG BUY Toyota Impresses With Earnings

    VALUATION WATCH: Overvalued stocks now make up 48.67% of our stocks assigned a valuation and 17.08% of those equities are calculated to be overvalued by 20% or more. Nine sectors are calculated to be overvalued--with two at or near double digits.

    --A Yen for Profit... ValuEngine STRONG BUY Toyota Impresses with Earnings

    Toyota Motor Corporation (NYSE:TM) produces, sells, leases, and repairs passenger cars, trucks, buses, boats, airplanes and other products in Japan and most foreign countries. The Company is also involved in the businesses of real estate, civil engineering, insurance,etc.

    Toyota posted US sales figures this week and the numbers were rather flat with a 0.6% increase overall led by the ever-popular--and reliable--Camry model. The Tacoma and Tundra pick ups were also good sellers for the company--up more than 15%.

    Overall, the company is posting stronger earnings numbers thanks to a weaker yen and strong overseas sales. That blip in exchange rates helped boost the company to an increased profit rather than a decline. The company possesses stronger margins than its rivals and some good benefits from plants located within Japan. The question mark for Toyota--and all auto makers, remains China. That market is now in a position to make or break all of the manufacturers. It is too early to tell how a slowdown there will effect the bottom line.

    ValuEngine continues its STRONG BUY recommendation on TOYOTA MOTOR CP for 2015-08-03. Based on the information we have gathered and our resulting research, we feel that TOYOTA MOTOR CP has the probability to OUTPERFORM average market performance for the next year. The company exhibits ATTRACTIVE Company Size and P/E Ratio.

    Below is today's more extensive data on TM:


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month134.460.96%
    3-Month136.522.51%
    6-Month139.604.82%
    1-Year148.4811.49%
    2-Year144.458.46%
    3-Year123.17-7.51%

     















    Valuation & Rankings
    Valuation3.15% overvaluedValuation Rank(?) 43
    1-M Forecast Return0.96%1-M Forecast Return Rank 97
    12-M Return12.75%Momentum Rank(?) 73
    Sharpe Ratio0.68Sharpe Ratio Rank(?) 85
    5-Y Avg Annual Return12.84%5-Y Avg Annual Rtn Rank 79
    Volatility18.91%Volatility Rank(?) 76
    Expected EPS Growth18.40%EPSGrowth Rank(?) 56
    Market Cap (billions)209.46Size Rank 100
    Trailing P/E Ratio11.56Trailing P/E Rank(?) 87
    Forward P/E Ratio9.76Forward P/E Ratio Rank 85
    PEG Ratio0.63PEG Ratio Rank 55
    Price/Sales0.85Price/Sales Rank(?) 71
    Market/Book1.30Market/Book Rank(?) 67
    Beta0.63Beta Rank 61
    Alpha0.07Alpha Rank 76

    ValuEngine.com is an independent research provider, producing buy/hold/sell recommendations, target price, and valuations on over 7,000 US and Canadian equities every trading day.
    Visit our website for more information and a free trial.

    Tags: TM, autos
    Aug 04 4:25 PM | Link | Comment!
  • 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!
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