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Steve Hach
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Steve Hach is the Senior Editor at ValuEngine.com, a Newtown, Pennsylvania-based stock valuation and forecast service. ValuEngine utilizes Ivy League financial research as the basis for its coverage of more than 7000 US, Japanese, and Canadian, and other foreign stocks. Hach utilizes... More
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  • Latest Bank Of America/SEC Settlement News Changes Little For The Stock

    VALUATION WATCH IS OFF: Overvalued stocks now make up 59% of our stocks assigned a valuation and 20% of those equities are calculated to be overvalued by 20% or more. Fifteen sectors are calculated to be overvalued--one by double digits.

    Settled

    --Bank of America Settles with SEC Over Capital Reporting "Errors"

    Bank of America Corporation (NYSE:BAC) is a bank holding company, and a financial holding company. Bank of America is a financial institution, serving individual consumers, small and middle market businesses, corporations and Governments with a range of banking, investing, asset management and other financial and risk management products and services.

    The Wall Street Journal reports that the company has agreed to pay an almost $8 million fine to the SEC over a series of capital reporting "errors" it made dating back to 2009. The company tried to exclude losses associated with the purchase of Merrill Lynch and over time the misreporting grew so that by the end of 2013 it ballooned to more than $4 billion. The failure to properly report capital levels also stymied the company's share buy-back plans (but left a proposed 0.05$/share dividend intact.) while the bank was not completely accurate in its reporting, the SEC notes that they were cooperative with the investigation, self-reported the error, and at no time did they fall under regulatory requirements for minimum capital ratios.

    While we don't expect this fine or news to have much effect on BAC shares, we nonetheless find that the forecast for the bank is not good. ValuEngine continues its SELL recommendation on Bank of America for 2014-09-26. Based on the information we have gathered and our resulting research, we feel that Bank of America has the probability to UNDERPERFORM average market performance for the next year. The company exhibits UNATTRACTIVE Sharpe Ratio and P/E Ratio.

    Below is today's data on BAC:


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month16.91-0.72%
    3-Month16.81-1.31%
    6-Month16.79-1.39%
    1-Year15.57-8.58%
    2-Year18.035.90%
    3-Year15.49-9.04%

     















    Valuation & Rankings
    Valuation25.52% overvaluedValuation Rank(?) 15
    1-M Forecast Return-0.72%1-M Forecast Return Rank 11
    12-M Return20.95%Momentum Rank(?) 76
    Sharpe Ratio-0.05Sharpe Ratio Rank(?) 38
    5-Y Avg Annual Return-1.78%5-Y Avg Annual Rtn Rank 38
    Volatility36.64%Volatility Rank(?) 54
    Expected EPS Growth120.90%EPSGrowth Rank(?) 87
    Market Cap (billions)179.16Size Rank 100
    Trailing P/E Ratio28.86Trailing P/E Rank(?) 42
    Forward P/E Ratio13.07Forward P/E Ratio Rank 68
    PEG Ratio0.24PEG Ratio Rank 74
    Price/Sales1.81Price/Sales Rank(?) 50
    Market/Book1.13Market/Book Rank(?) 75
    Beta1.67Beta Rank 21
    Alpha-0.21Alpha Rank 29

    Tags: BAC
    Sep 29 1:31 PM | Link | Comment!
  • Aerospace, BlackBerry, And Valuations From ValuEngine.com

    VALUATION WARNING: Our Valuation WARNING is OFF. Recent market pull backs have resulted in market overvaluation figures lower than any time since May, 2013. Overvalued stocks now make up 58% of our stocks assigned a valuation and 18.89% of those equities are calculated to be overvalued by 20% or more. Fifteen sectors are calculated to be overvalued--four by double digits.

    ValuEngine Index Overview

     

     

     

     

     

    IndexWeek OpenFriday AMChange% ChangeYTD
    DJIA17271.7117021.7-250.01-1.45%2.68%
    NASDAQ4568.454483.95-84.5-1.85%7.36%
    RUSSELL 20001141.991114.24-27.75-2.43%-4.25%
    S&P 5001965.991971.615.620.29%6.67%

     

    ValuEngine Market Overview

     

     


     

    Summary of VE Stock Universe
    Stocks Undervalued41.9%
    Stocks Overvalued58.1%
    Stocks Undervalued by 20%13.36%
    Stocks Overvalued by 20%18.89%
    ValuEngine Sector Overview

     
















    SectorChangeMTDYTDValuationLast 12-MReturnP/E Ratio
    Consumer Staples-1.41%-3.80%1.55%15.38% overvalued10.49%24.90
    Computer and Technology-1.55%-4.34%2.59%12.24% overvalued10.16%31.64
    Multi-Sector Conglomerates-1.20%-3.89%0.86%11.89% overvalued9.68%22.00
    Medical-1.47%-3.80%8.53%11.36% overvalued16.87%30.92
    Aerospace-1.03%-1.20%-1.48%9.91% overvalued22.47%19.63
    Transportation-1.11%-2.99%4.65%8.61% overvalued14.32%20.09
    Retail-Wholesale-1.20%-3.88%-6.27%8.19% overvalued0.54%24.06
    Finance-0.88%-2.55%2.28%7.31% overvalued6.87%17.56
    Consumer Discretionary-0.65%-3.45%-3.94%6.58% overvalued5.55%28.79
    Auto-Tires-Trucks-1.37%-6.41%-0.91%5.33% overvalued6.68%16.98
    Business Services-1.64%-3.78%-2.17%5.21% overvalued16.05%24.01
    Utilities-1.14%-3.63%5.50%4.82% overvalued9.15%20.04
    Oils-Energy-1.68%-8.60%7.21%4.59% overvalued10.38%25.18
    Industrial Products-1.37%-4.66%-3.80%3.88% overvalued7.17%22.49
    Construction-1.04%-5.15%-2.06%2.94% overvalued7.94%24.36
    Basic Materials-0.98%-7.42%1.02%6.26% undervalued-2.12%25.51

    Free Download for Readers

    As a bonus to our Free Weekly Newsletter subscribers,
    we are offering a FREE DOWNLOAD of one of our Stock Reports

    BlackBerry Limited is involved in the design, manufacture and marketing of wireless solutions for the mobile communications market. Its integrated hardware, software and services provide platforms and solutions for seamless access to information which includes e-mail, voice, instant messaging, short message service, Internet and intranet-based applications and browsing. The company operates in North America, Europe, Asia Pacific and Latin America. BlackBerry Limited, formerly known as Research In Motion Limited, is headquartered in Waterloo, Canada.

    ValuEngine continues its STRONG SELL recommendation on BLACKBERRY LTD for 2014-09-25. Based on the information we have gathered and our resulting research, we feel that BLACKBERRY LTD has the probability to UNDERPERFORM average market performance for the next year. The company exhibits UNATTRACTIVE Sharpe Ratio and P/E Ratio.

    As a bonus to our Newsletter readers,
    we are offering a FREE DOWNLOAD of one of our Stock Reports

    Read our Complete Detailed Valuation Report on BlackBerry HERE.

    Sector Talk--Aerospace

    Below, we present the latest data on Aerospace stocks from our Institutional software package (Pending:VEI). Top five lists are provided for each category. We applied some basic liquidity criteria--share price greater than $3 and average daily volume in excess of 100k shares.

    Please Click Here to Download a FREE Demo of ValuEngine's Professional VEI Software Package.

    Top-Five Aerospace Stocks--Short-Term Forecast Returns

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    ATKALLIANT TECHSYS130.51-6.6434.35
    ARTXAROTECH CORP3.21-7.6181.36
    WAIRWESCO AIRCRAFT17.25-14.86-17.19
    ERJEMBRAER AIR-ADR37.781.6313.08
    SPRSPIRIT AEROSYS38.287.1558.57

    Top-Five Aerospace Stocks--Long-Term Forecast Returns

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    ATKALLIANT TECHSYS130.51-6.6434.35
    ARTXAROTECH CORP3.21-7.6181.36
    WAIRWESCO AIRCRAFT17.25-14.86-17.19
    ERJEMBRAER AIR-ADR37.781.6313.08
    SPRSPIRIT AEROSYS38.287.1558.57

    Top-Five Aerospace Stocks--Composite Score

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    ATKALLIANT TECHSYS130.51-6.6434.35
    SPRSPIRIT AEROSYS38.287.1558.57
    ERJEMBRAER AIR-ADR37.781.6313.08
    BABOEING CO127.14-1.547.28
    HIIHUNTINGTON INGL104.18.4454.5

    Top-Five Aerospace Stocks--Most Overvalued

     

     

     

     

     

     

    TickerNameMkt PriceValuation(%)Last 12-M Retn(%)
    GDGENL DYNAMICS125.0143.7842.48
    ORBORBITAL SCIENCE28.4530.4838.04
    TDGTRANSDIGM GROUP182.6225.7134.61
    ATROASTRONICS CORP49.7523.52-2.14
    AIRAAR CORP25.1720.62-7.33

    Find out what Wall Street Investment and Media Professionals already know,
    ValuEngine offers sophisticated stock valuation and forecast research as well as a variety of portfolio screening and creation tools.

    If you are reading this you should sign up for ValuEngine's award-winning stock valuation and forecast service
    NO OBLIGATION, 30 DAY FREE TRIAL!
    To Sign Up for a FREE TRIAL, Please Click HERE
    What's Hot--With Latest Market Action, Overvaluation Down Again

    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 combine all of the equities with a valuation calculation to track market valuation figures and use them as a metric for making calls about the overall state of the market. Two factors can lower these figures-- a market pullback, or a significant rise in EPS estimates. Whenever we see overvaluation levels in excess of @ 65% for the overall universe and/or 27% for the overvalued by 20% or more categories, we issue a valuation warning. We issued our latest valuation warning on August 19, 2014. At that time, the S&P was at 1971.74.

    We now calculate that 58% of stocks are overvalued and 18.89% of those stocks are overvalued by 20% or more. This week's market pull back-- combined with changes in earnings and stock prices-- have resulted in figures that are now the lowest recorded since May 6, 2013.

    With these sorts of numbers, we no longer have a "Valuation Warning." We find ourselves back in "normal" range from a valuation perspective. This does not mean we have a "buy" signal yet. In the recent past these declines have only lasted a few days.

    Middle East unrest, the Ukrainian Crisis, and other world events have created uncertainty for investors, but we do not believe foreign policy crises as currently configured will have a long-term impact for the market. Apple is such a behemoth that it's botched iPhone 6 rollout can rattle the entire market--see the bulletin on that topic HERE. And the news that Bill Gross is out at Pimco is also a big event. Of more import is the end of the Fed's QE program and how/if rates will increase. Janet Yellen seems to have the issue in hand. We still believe that if the final piece of the recovery puzzle can be placed--employment, equities could post another big leg up.

    In any case, we expect that this will only be a temporary respite and that overvaluation will soon exceed the 60% level required for a Valuation Watch within a few days.

    Subscribers Get FULL ACCESS to our Market and Sector Overviews

    The chart below tracks the valuation metrics from January 2014. It shows levels in excess of 65% when we are under a Valuation Warning.

    (click to enlarge)

    This chart shows overall universe over valuation in excess of 65% vs the S&P 500 from January 2013

    (click to enlarge)

    This chart shows overall universe under and over valuation in excess of 50% vs the S&P 500 from March 2007*

    (click to enlarge)

    *NOTE: Time Scale Compressed Prior to 2011.

    In addition to the overall valuation metrics, we see that on a sector basis the declines in overvaluation have also relived some pressure. While fifteen of sixteen sectors remain overvalued according to our Valuation Model, only four of them remain calculated to be overvalued by double digits.

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Tags: ATK, ARTX, WAIR, ERJ, SPR, BA, HII, GD, ORB, TDG, ATRO, AIR, BBRY, aerospace
    Sep 26 2:55 PM | Link | Comment!
  • Navios Drops Yet Again, Dry Bulk Carnage...

    VALUATION WATCH: Overvalued stocks now make up 61.83% of our stocks assigned a valuation and 21.71% of those equities are calculated to be overvalued by 20% or more. Fifteen sectors are calculated to be overvalued--three by double digits.

    Short Score

    --Shipper Navios Marine Leads Short-Side of VE Market Neutral Newsletter

    Navios Maritime Holdings Inc. is a seaborne shipping and logistics company engaged in the transport and transshipment of drybulk commodities including iron ore, coal and grain. It operates in three segments: Drybulk Vessel Operations, Tanker Vessel Operations and Logistics Business. The Company also engages in operating ports and transfer station terminals and handles vessels, barges, and push boats, as well as operates upriver transport facilities in the Hidrovia region. Navios Maritime Holdings Inc. is headquartered in Piraeus, Greece.

    Navios Maritime has been on a decline of late, posting a new one-year yesterday and currently down more than 8% during today's market sell-off. It currently leads the way for our Forecast 16 Market Neutral subscribers. As a short-pick for this month's newsletter, the stock is down more than 20% as of yesterday's close.

    We keep an eye on dry-bulk shippers like Navios because they are considered a leading indicator of economic activity by many analysts. When dry-bulks boom it is good news, when they swoon it is bad because their cargo forms the basis of the global economy. YTD the Baltic Dry Index is down @50%.

    ValuEngine continues its STRONG SELL recommendation on Navios Maritime Holdings for 2014-09-24. Based on the information we have gathered and our resulting research, we feel that Navios Maritime Holdings has the probability to UNDERPERFORM average market performance for the next year. The company exhibits UNATTRACTIVE P/E Ratio and Momentum.

    As a bonus to our Daily Bulletin readers,
    we are offering a FREE DOWNLOAD of one of our Stock Reports

    Read our Complete Detailed Valuation Report on NM HERE.

    Below is today's data on NM:


     






    ValuEngine Forecast
     Target
    Price*
    Expected
    Return
    1-Month102.34-0.30%
    3-Month102.60-0.03%
    6-Month103.751.08%
    1-Year98.99-3.55%
    2-Year117.8914.86%
    3-Year62.39-39.21%

     















    Valuation & Rankings
    Valuation13.00% overvaluedValuation Rank(?) 34
    1-M Forecast Return-1.19%1-M Forecast Return Rank 3
    12-M Return-10.99%Momentum Rank(?) 27
    Sharpe Ratio0.34Sharpe Ratio Rank(?) 66
    5-Y Avg Annual Return14.73%5-Y Avg Annual Rtn Rank 77
    Volatility43.00%Volatility Rank(?) 45
    Expected EPS Growth378.81%EPSGrowth Rank(?) 96
    Market Cap (billions)0.68Size Rank 61
    Trailing P/E Ration/aTrailing P/E Rank(?) 16
    Forward P/E Ratio5.91Forward P/E Ratio Rank 98
    PEG Ratio0.04PEG Ratio Rank 91
    Price/Sales1.30Price/Sales Rank(?) 61
    Market/Book0.80Market/Book Rank(?) 86
    Beta2.02Beta Rank 13
    Alpha0.03Alpha Rank 67

    Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Sep 25 2:33 PM | Link | Comment!
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