Monthly Archives: February 2018

The Fallout From Carillion’s Failure: Could Interserve Be The Next Domino To Fall?

&l;p&g;Another day, another U.K. construction company on the ropes. Following Carillion&s;s failure and Capita&s;s profits warning, the next domino that could be about to fall is Interserve. Its share price &l;a href=&q;http://www.thisismoney.co.uk/money/markets/article-5437559/Now-hedge-funds-target-Interserve-shares-slump-12.html&q; target=&q;_blank&q;&g;was hammered yesterday&l;/a&g;, falling 12% on &l;a href=&q;https://www.telegraph.co.uk/business/2018/02/24/interserve-crisis-grows-debt-talks-stumble/&q; target=&q;_blank&q;&g;a report in the U.K.&a;rsquo;s &l;em&g;Telegraph&l;/em&g; newspaper&l;/a&g; that the company was having trouble refinancing its estimated &a;pound;500 million debt pile. Although the share price recovered somewhat after Interserve&a;nbsp;&l;a href=&q;http://www.cityam.com/281202/interserve-share-price-hits-back-insisting-refinancing-has-not-stumbled&q; target=&q;_blank&q;&g;robustly denied the report&l;/a&g;, the stock is heavily shorted, suggesting that the share price has further to fall. For Interserve, this could be bad news.

&l;img class=&q;dam-image getty size-large wp-image-905907352&q; src=&q;https://specials-images.forbesimg.com/dam/imageserve/905907352/960×0.jpg?fit=scale&q; data-height=&q;602&q; data-width=&q;960&q;&g; A general view of signage at Interserve&s;s headquarters in Twyford near Reading in Berkshire, England, as shares in the company plunged amid reports that the Government is keeping a close eye on the outsourcing giant&s;s financial health following Carillion&s;s collapse. (Photo by Steve Parsons/PA Images via Getty Images)

Interserve is experiencing severe cash flow problems, mainly due to its waste management business on which it has been taking heavy losses for some time. In 2016, it decided to exit from this business, and it is now taking on no more work in this sector. But it is still running down a bunch of contracts on which cash outflows are significantly exceeding inflows. Seeing these contracts through to completion is raising Interserve&a;rsquo;s short-term borrowing requirement, forcing it to seek additional funding from banks.

Interserve insists that the problems are short-term, arising only from the run-off of the waste management business. If this is true, then it would be reasonable to extend short-term finance to keep the company going until its cash flow recovers. But Carillion also insisted that its problems were simply short-term liquidity problems due to difficulties with a few contracts, and would be solved in a few months if only someone would bung it some cash. It turned out to be deeply insolvent. Banks that took large losses when Carillion failed are therefore understandably wary of extending more finance to a company that, on the face of it, appears to be in a similar mess.

So, is Interserve similar to Carillion? Is it concealing insolvency under a blanket of cash flow strains, as Carillion was? Not just the banks, but the &l;a href=&q;http://www.interserve.com/about-us&q; target=&q;_blank&q;&g;80,000 people worldwide&l;/a&g; whose jobs would be at risk if it failed, deserve to know the truth.

The &l;a href=&q;http://www.interserve.com/docs/default-source/investors/financial-reports/presentation-results/2016/2016-annual-report.pdf?sfvrsn=8&q; target=&q;_blank&q;&g;2016 full-year accounts&l;/a&g; reveal a deeply distressed company. Interserve made a loss of &a;pound;101 million in 2016, and operating cash flow was significantly negative. However, this was almost entirely due to the waste management business. Since the contracts are loss-making, they have to be run off rather than sold. Consequently, the waste management business did not meet the criteria for &a;ldquo;held for sale&a;rdquo; or &a;ldquo;discontinued operations.&a;rdquo; So Interserve listed it under &a;ldquo;exceptional items,&a;rdquo; implying that expenses from the waste management contracts were one-off items that would not recur.

The notes to the accounts reveal that Interserve&a;rsquo;s management knew perfectly well that this was a fudge:

&l;/p&g;&l;blockquote&g;IAS 1 requires material items to be disclosed separately in a way that enables users to assess the quality of a company&a;rsquo;s profitability. In practice, these are commonly referred to as &a;ldquo;exceptional&a;rdquo; items, but this is not a concept defined by IFRS and therefore there is a level of judgement involved in determining what to include in headline profit.&l;/blockquote&g;

The fudge magically turned a &a;pound;101&a;nbsp;&l;span&g;million&l;/span&g; loss into a &a;pound;94&a;nbsp;&l;span&g;million&l;/span&g; profit, justifying a dividend payment to shareholders of &a;pound;34.1 &l;span&g;million&l;/span&g;.

But the losses turned out not to be &a;ldquo;one-offs that would not recur.&a;rdquo; The company continued to hemorrhage money. By June 2017, &l;a href=&q;http://www.interserve.com/docs/default-source/investors/financial-reports/presentation-results/2017/2017-half-year-report.pdf?sfvrsn=3&q; target=&q;_blank&q;&g;Interserve&a;rsquo;s cash flow was failing&l;/a&g;. Cash from operations turned sharply negative as net cash inflows from other parts of the business dropped while cash continued to drain from the waste management business. Interserve&a;rsquo;s net debt rose by &a;pound;113 &l;span&g;million&l;/span&g;, an increase of some 25% in six months.

Not only did Interserve&a;rsquo;s net debt rise, but the average maturity shortened too, as short-term borrowing rose by &a;pound;155 &l;span&g;million&l;/span&g;. For me, sharply rising short-term debt is always a red flag, especially when combined with negative cash flow. But Interserve was sanguine about it all. It cheerfully forecast that the company&a;rsquo;s cash position would improve in the second half of the year.

It didn&a;rsquo;t. In September, two weeks after the new CEO, Debbie White, started work, the company issued its &l;a href=&q;http://otp.investis.com/clients/uk/interserve/rns/regulatory-story.aspx?cid=720&a;amp;newsid=924887&q; target=&q;_blank&q;&g;first profit warning&l;/a&g;. Here&a;rsquo;s what it said:

&l;blockquote&g;Trading in the UK in July and August was disappointing, particularly in support services, but also in the construction division. As a result of this, the Board now believes that the outturn for the year will be significantly below its previous expectations.

Further progress continues to be made on contracts within our exited Energy from Waste business. However, the anticipated timing and complexities of completion mean that the Board now considers it likely that the final costs will significantly exceed the &a;pound;160&a;nbsp;&l;span&g;million&l;/span&g; currently provided&l;span&g;.&l;/span&g;&l;/blockquote&g;

So Interserve&a;rsquo;s profits warning was not primarily due to losses on a few contracts, although the losses were bigger than expected. It was due to a general downturn in two of its core U.K. divisions. This is beginning to look a lot more like Carillion, isn&a;rsquo;t it?

&l;!–nextpage–&g;

The company issued a &l;a href=&q;http://otp.investis.com/clients/uk/interserve/rns/regulatory-story.aspx?cid=720&a;amp;newsid=941191&q; target=&q;_blank&q;&g;further trading update&l;/a&g; in October 2017, in which it admitted that third-quarter trading was even worse than in the first half of the year. It said that profit for the second half of the year would only be half that of the second half-year in 2016, and warned that it was potentially going to breach its loan covenants, the next test for which would be in December.

This was a game changer. The share price, which had fallen off a cliff after the first profit warning but then recovered somewhat, fell again and remained low until December, when the company &l;a href=&q;http://otp.investis.com/clients/uk/interserve/rns/regulatory-story.aspx?cid=720&a;amp;newsid=958019&q; target=&q;_blank&q;&g;announced&l;/a&g; that it had deferred the loan covenant test until March and had secured additional bank financing of &a;pound;180&a;nbsp;&l;span&g;million&l;/span&g; for three months.

&l;img class=&q;size-large wp-image-2940&q; src=&q;http://blogs-images.forbes.com/francescoppola/files/2018/02/Interserve-share-price-1200×801.jpg?width=960&q; alt=&q;&q; data-height=&q;801&q; data-width=&q;1200&q;&g; Interserve share price

But it is the reason for the second profit warning that should give everyone pause for thought &l;em&g;(my emphasis)&l;/em&g;:

&l;blockquote&g;In &l;strong&g;U.K.&l;/strong&g;&l;strong&g; support services&l;/strong&g;, this was driven by the &l;b&g;continued employment cost pressures in the business, the cost of contract mobilizations, margin deterioration driven by a cost base which has not been flexible enough and contract performance in the justice business&l;/b&g;. Our &l;strong&g;U.K.&l;/strong&g;&l;strong&g; construction business&l;/strong&g; has seen further deterioration in operating profit as &l;strong&g;challenging market conditions and cost pressures as well as operational delivery issues have continued to impact performance&l;/strong&g;.&a;nbsp; Our equipment services business is performing well and as anticipated, the international support services business has started to improve versus the first half performance and in international construction we have maintained a stable performance.&l;/blockquote&g;

The primary cause of the company&a;rsquo;s collapsing profits is rising costs, low margins and poor contract performance in two of its three core divisions. Waste management doesn&a;rsquo;t even get a mention.

I don&a;rsquo;t know why experienced analysts such as &l;a href=&q;http://www.bbc.co.uk/news/business-42902066&q; target=&q;_blank&q;&g;the BBC&a;rsquo;s Simon Jack&l;/a&g; are still saying that its problems mainly stem from its loss-making waste management contracts:

&l;blockquote&g;Carillion had a number of major projects that went sour whereas Interserve&s;s problems stem primarily from one line of business – its energy-from-waste business – from which it is extricating itself.&l;/blockquote&g;

That&a;rsquo;s not what the figures or the company&a;rsquo;s trading updates say. Interserve&a;rsquo;s immediate problem is the financing cliff edge that it faces in March. But the underlying issue is that its core businesses are performing extremely badly.

Like most companies of its kind, Interserve&a;rsquo;s balance sheet is made up largely of intangible assets. And it is very highly indebted. The profitability decline in its core businesses therefore threatens its solvency &a;ndash; and the jobs of 80,000 people.

Interserve cannot continue to pretend that its problems are simply cash flow. It needs to deleverage rapidly, and that means tapping shareholders for cash. The new CEO announced a restructuring program last September, but the behaviour of the share price since then does not suggest that investors have a great deal of confidence in her plans. The share price has fallen from 236 pence per share a year ago to 60 pence per share now, and the company&a;rsquo;s market cap is a paltry &a;pound;92 &l;span&g;million&l;/span&g;. The question now is whether the new CEO has left it too late for the rights issue and radical restructuring that is so evidently needed.

&a;nbsp;

Hot Blue Chip Stocks To Invest In Right Now

NEW YORK Stocks fellWednesday as the Dow dropped more than 100 points, putting more distance between the blue chipsand that elusive 20,000 mark.

Dow 20,000 has been in sight for several days now, with the index getting as close as a couple of dozen points from the milestone but never reaching it.

At the 4 p.m. ET close, the Dow stood0.6% lower for the day, off 111points and 166away from 20,000. Meanwhilethe Nasdaqsank 0.9% andthe S&P 500 lost0.8%.

The broad decline wiped out most of the gains from the day before, when the Nasdaq composite index closed at a record high.

Trading was quiet in a light week of economic and company news before the New Years Day holiday weekend.

Shares of luxury handbag maker Kate Spade (KATE) leaped 23.1%after news reports surfaced about a possible sale of the company.

Hot Blue Chip Stocks To Invest In Right Now: Cytokinetics, Incorporated(CYTK)

Advisors’ Opinion:

  • [By Paul Ausick]

    Cytokinetics Inc. (NASDAQ: CYTK) dropped about 37% Tuesday to post a new 52-week low of $7.00 after closing at $11.10 on Monday. The 52-week high is $17.20. Volume was around 7 million, about 14 times the daily average of less than 500,000. The company’s ALS drug failed ti meet its endpoint in a phase 3 study.

  • [By Lisa Levin]

    Cytokinetics, Inc. (NASDAQ: CYTK) shares dropped 27 percent to $8.12 on the back of negative trial results for its amyotrophic lateral sclerosis, or ALS, treatment candidate tirasemtiv in a late-stage study. The results of the international Phase 3 study showed tiraemtive did not meet the primary endpoint of change from baseline in slow vital capacity, or SVS, evaluated at 24 weeks, as well the secondary endpoints evaluated at 48 weeks.

  • [By Chris Lange]

    Cytokinetics, Inc. (NASDAQ: CYTK) saw its shares take a massive step back in Tuesdays session after the firm reported negative results for its trial in amyotrophic lateral sclerosis (ALS). Specifically, the firms Phase 3 clinical trial of tirasemtiv did not meet the primary endpoint or any of the secondary endpoints.

  • [By Lisa Levin] Gainers
    Marathon Patent Group Inc (NASDAQ: MARA) shares surged 30.2 percent to $5.01 after dropping 40.86 percent on Tuesday. Marathon Patent Group filed for sale of 1.85 million shares of common stock by selling stockholders.
    Capricor Therapeutics Inc (NASDAQ: CAPR) shares jumped 17.2 percent to $2.25 after the company reported the FDA clearance of Investigational New Drug application for CAP-1002.
    Rite Aid Corporation (NYSE: RAD) gained 13.2 percent to $2.15 following 16.5 percent rally on Tuesday.
    Photronics, Inc. (NASDAQ: PLAB) shares climbed 11.8 percent to $10.45 after the company reported stronger-than-expected earnings for its fourth quarter.
    China Distance Education Hldgs Ltd (ADR) (NYSE: DL) shares surged 11.3 percent to $8.67. China Distance Education reported Q4 profit of $5.9 million on revenue of $41.7 million.
    Cytokinetics, Inc. (NASDAQ: CYTK) shares gained 11 percent to $8.05 after falling 7.05 percent on Tuesday.
    Ooma Inc (NYSE: OOMA) shares surged 8.5 percent to $10.85 as the company posted strong Q3 results.
    Nuance Communications Inc. (NASDAQ: NUAN) climbed 8 percent to $17.12 after the company reported stronger-than-expected results for its fourth quarter on Tuesday.
    American Superconductor Corporation (NASDAQ: AMSC) surged 7.8 percent to $3.59 after the company reported $8 million in D-VAR system orders.
    Thermon Group Holdings Inc (NYSE: THR) rose 6.3 percent to $24.17. William Blair upgraded Thermon Group from Market Perform to Outperform.
    Domino's Pizza, Inc. (NYSE: DPZ) surged 6.1 percent to $182.88. Nomura upgraded Domino's from Neutral to Buy.
    Xencor Inc (NASDAQ: XNCR) rose 5.9 percent to $21.17. Cantor Fitzgerald initiated coverage on Xencor with an Overweight rating.
    Idera Pharmaceuticals Inc (NASDAQ: IDRA) gained 5.1 percent to $2.28 after the company disclosed that it has been granted FDA Fast Track designation for IMO-2125.
    Regal Entertainment Group (NYSE: RGC) gained 5.1 percent to

Hot Blue Chip Stocks To Invest In Right Now: Deer Valley Corporation (DVLY)

Advisors’ Opinion:

  • [By SEEKINGALPHA.COM]

    Deer Valley (OTCPK:DVLY)

    This company manufactures factory-made homes which are marketed to 14 states in the US. After the financial crisis it has been able to pick up its operations and continue to create sustainable free cash flow and increasing profits. It might be that another similar shock to housing is not necessarily around the corner and therefore they could sustain this in the foreseeable future.

Hot Blue Chip Stocks To Invest In Right Now: Viking Therapeutics, Inc.(VKTX)

Advisors’ Opinion:

  • [By Lisa Levin]

     

    Losers
    DBV Technologies SA – ADR (NASDAQ: DBVT) shares tumbled 50.6 percent to $23.73 after the company disclosed that its peanut allergy trial failed to meet primary endpoint.
    Connecture Inc (NASDAQ: CNXR) shares declined 40.8 percent to $0.290. Connecture reported that it will voluntarily delist from the NASDAQ for OTCQX Market.
    Walter Investment Management Corp (NYSE: WAC) slipped 19.2 percent to $0.410. On Friday, Walter Investment Management disclosed that it has reached an agreement with term lenders and senior noteholders on financial restructuring.
    Eldorado Gold Corp (USA) (NYSE: EGO) shares dropped 15.9 percent to $1.83. Eldorado Gold lowered its production guidance for its Kisladag operation.
    Seanergy Maritime Holdings Corp. (NASDAQ: SHIP) shares fell 15.4 percent to $1.04.
    Future Fintech Group Inc (NASDAQ: FTFT) dropped 13.6 percent to $1.53. Future FinTech reported filing of proxy statement, including proposal for corporate restructuring.
    Concordia International Corp (NASDAQ: CXRX) shares fell 12.3 percent to $0.500 after dipping 38.71 percent on Friday.
    Aemetis Inc (NASDAQ: AMTX) shares declined 11.3 percent to $0.550
    OncoSec Medical Inc (NASDAQ: ONCS) dipped 10.5 percent to $1.12. OncoSec reported a $7.1 million registered direct at-the-market offering at a price of $1.34375 per share.
    Evoke Pharma Inc (NASDAQ: EVOK) shares fell 10.35 percent to $3.08 after the company disclosed 'positive' topline results from comparative exposure pharmacokinetic study for Gimoti.
    Eiger Biopharmaceuticals Inc (NASDAQ: EIGR) shares dropped 9.4 percent to $11.60 as the company disclosed Phase 2 interim 24-week data with pegylated interferon lambda in Hepatitis Delta Virus infection at the American Association for the Study of Liver Diseases Meeting.
    Viking Therapeutics Inc (NASDAQ: VKTX) shares slipped 6.6 percent to $2.80. Viking Therapeutics presented results from proof-of-concept study of VK0214 in in vivo

  • [By William Romov]

    Currently trading at $4.52 per share, Viking Therapeutics Inc. (Nasdaq: VKTX) develops drugs to treat fatty liver disease and post-hip surgery rehabilitation. It has the highest share price of the penny stocks on our list today.

  • [By Lisa Levin]

    Viking Therapeutics Inc (NASDAQ: VKTX) shares dropped 39 percent to $1.17 after the company priced 7.5 million share offering at $1.25 per share.

Hot Blue Chip Stocks To Invest In Right Now: Panasonic Corporation (PCRFY)

Advisors’ Opinion:

  • [By SEEKINGALPHA.COM]

    A Unilever vs. Panasonic (OTCPK:PCRFY) showdown seems to be something out of an alternative, weird universe. But that’s exactly what has been happening in the Asia-Pacific region, where Unilever is now a major seller of air and water purification devices. The acquisitions of Qinyuan and Pureit water purifiers, as well as the acquisition of Sweden-based Blueair in 2016, reflects Unilever’s latest growth strategy of reducing exposure to low-growth brands in favor of greater investments in higher-growth products with strong social and environmental credentials.

  • [By Ben Levisohn]

    During the early stages of a new innovation, interdependent architectures and integrated companies best optimize performance and functionality. This trend has played out in computing and handsets, and we see the same trend playing out in EVs. We find Tesla and BYD1 , by far, the most vertically integrated players in EVs, with huge scale advantages. In addition, LG Chem, Panasonic (PCRFY), Samsung SDI, BYD, and CATL are clear scale leaders in batteries (CATL is not publicly traded. All but Samsung SDI and BYD are not covered by Bernstein.).

  • [By SEEKINGALPHA.COM]

    SMMYY is a subsidiary of the Sumitomo Group. SMMYY is a major smelter and refiner of copper, nickel and gold in Japan, and has a 27.5% stake in the Ambatovy Nickel Project in Madagascar, along with Sherritt International and Korea Resources Corp. Feedstock for the refinery is nickel cobalt mixed sulphide from its Taganito and Coral Bay mines in the Philippines (noting the Philippines is a risky supply source at this time). Sumitomo supply Panasonic (OTCPK:PCRFY) who supply Tesla (NASDAQ:TSLA); however, this can change. Generally, I like the stock; however, at this time, valuation looks full, trading on a 2017 PE of 32.8, and 2018 PE of 14.8. Good to buy after a pullback if that occurs.

  • [By SEEKINGALPHA.COM]

    JOLED is a company that was established in 2014 by by Japan Display, Sony (NYSE:SNE) and Panasonic (OTCPK:PCRFY). And they are not the only ones:

    During an OLED display Seminar in Korea, UniJet’s CEO Kim Seok-Soon said that new advances in Ink-Jet printing technologies could enable displays that are over 500 PPI – and so make printing a viable technology to produce small and medium-sized OLED panels.

  • [By SEEKINGALPHA.COM]

    Clean Technica reported on September 1 that “Sony is entering the EV battery manufacturing industry”. And “considering that electric vehicle batteries are going to be the main supply bottleneck for the upcoming auto market’s embrace of EVs, the entry of Sony into the field is very notable. Most of the other manufacturers (Panasonic (OTCPK:PCRFY), LG Chem (OTC:LGCLF), etc.) already have more or less all of their production capacity locked up for the coming years – meaning there’s not much left for the auto manufacturers that are running behind, thereby limiting potential EV sales for the firms in question. Sony’s (NYSE:SNE) entry into the field should open things up a bit more”. Certainly a good move by Sony and helpful for the EV companies that will find themselves in need of batteries, and limited availability, should EVs reach 10% by 2020.

Hot Blue Chip Stocks To Invest In Right Now: Toro Company (The)(TTC)

Advisors’ Opinion:

  • [By WWW.THESTREET.COM]

    In his “Homework” segment, Cramer followed up on a few stocks that had stumped him during earlier shows. He said that he’s taking a pass on Toro (TTC) , a stock that’s just off its highs and trades at a premium to rival Deere & Company (DE) .

  • [By Mitchell Clark]

     The Toro Company (NYSE:TTC) is one of my favorite small-caps for medium- to long-term investors. Selling specialized equipment for turf management and other industries, Toro is a proven winner that has provided very consistent growth in sales and earnings over the years.

    It’s not the fastest growing small-cap business, but it pays a decent dividend and has a loyal customer base in the golf course and contractor markets.

    Toro is now offering sprinkler refit equipment for water-starved jurisdictions like California. This company’s share price performance has been exemplary.

The Price of Gold Has Been Volatile, but a Rally Is Coming

Peter KrauthPeter Krauth

There’s been no shortage of forces pushing and pulling on the price of gold over the past week.

Federal Reserve minutes, stocks, the dollar, rising bond yields, budget deficits, inflation, sentiment, and even simple demand versus supply.

Price of gold

Gold gave up most of the gains it managed to tack on in the previous week. The bulk of that weakness came on Tuesday, as traders were preparing for the Fed’s January meeting minutes due out Wednesday.

Then came Wednesday, and gold put on a brave rally in response to the Fed, but quickly reversed to end the day.

Some Fed Open Market Committee members see economic growth accelerating faster than they did at their previous meeting. That caused the Dow to pop – along with gold prices – initially.

But then traders digested that and became concerned it could cause the Fed to raise rates faster than expected, perhaps hiking rates four times rather than three this year.

This Niche Gold Investment Could Soar While the Rest of the Market Drops

Bonds sold off, pushing the 10-year yield to near 3%, a level not seen since late 2013. In response, stocks sold off and gold joined them, losing a few dollars on the day.

But what’s been striking is gold’s quiet resilience in the face of a bouncing dollar and rising yields.

I think this year will mark a clear resumption to rallying gold prices, and after we recap last week’s gold price performance, I’ll show you exactly why…

Why the Price of Gold Moved Last Week

After the quiet trading day for gold on President’s Day (Feb. 19), the precious metal followed up with weakness as traders turned their attention to the next set big catalyst: the Fed minutes.

On Tuesday, Feb. 20, the U.S. Dollar Index (DXY) enjoyed a early morning rally, perhaps in anticipation of news that the Fed may be more hawkish on rates.

The DXY ran up from 89.35 to 89.70 by 9:00 a.m. Gold opened at $1,339 but sold off into late morning, reaching $1,329 by 1:00 p.m. The DXY held steady to 89.7 at 5:00 p.m., while gold then also moved sideways to close at $1,329.

Wednesday (Feb. 21) was the day FOMC meeting minutes were released. And like I detailed above, the minutes showed Fed officials were anticipating higher-than-expected economic growth. But faster economic growth could mean quicker rate hikes and higher bond yields, which compete with gold.

So the yellow metal, which opened at $1,328 and spiked to $1,335 just after 2:00 p.m., did an immediate reversal and sold down to $1,322 before a minor rebound to $1,323 by the close.

Check out how the dollar spiked on Wednesday after the minutes were released…

gold

Gold would suffer a bit more weakness overnight Wednesday into Thursday, as the DXY bounced above 90 and stayed there until just before 9:00 a.m. The DXY then sold off to around 89.75, allowing gold to regain some strength. The precious metal opened at $1,323, then rallied throughout the day to reach $1,331 by the 5:00 p.m. close.

And finally, to end the trading week, gold pulled back once again as the DXY made another run for 90 but hovered for most of the day around 89.9. Gold moved sideways, opening at $1,330, and by late afternoon, it was still trading at that level.

While gold prices showed some signs of weakness, they’ve actually held up better than expected. That’s giving me more reason to expect a gold price rally this year.

Here’s my gold price target after last week’s price action…

How High Gold Prices Will Rise in 2018

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Peter KrauthPeter Krauth

About the Author

Browse Peter’s articles | View Peter’s research services

Peter Krauth is the Resource Specialist for Money Map Press and has contributed some of the most popular and highly regarded investing articles on Money Morning. Peter is headquartered in resource-rich Canada, but he travels around the world to dig up the very best profit opportunity, whether it’s in gold, silver, oil, coal, or even potash.

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Top Gold Stocks To Own Right Now

Gold stocks had an incredible run to start the year.   The VanEck Vectors Gold Miners Fund (GDX) – the most popular exchange-traded fund for gold stocks – rocketed more than 150% from its January low to its August peak.   Since then, it has pulled back more than 30%. That trend will likely continue through the end of the month. And that creates a great opportunity to profit…   Take a look at the following chart of GDX…  
  You may not realize it, but it is common for the share prices of gold stocks to fall this time of year. That's because of a strategy called "tax-loss selling."

Top Gold Stocks To Own Right Now: Golden Star Resources Ltd(GSS)

Advisors’ Opinion:

  • [By Cameron Saucier]

    Golden Star (NYSEMKT: GSS) is a gold mining and exploration company, and operates gold mines in Ghana, West Africa. GSS is up 396% YTD after it announced in July that it had begun pre-commercial production of gold in an underground mine in Ghana. GSS is trading at $0.825 per share on Monday intraday.

Top Gold Stocks To Own Right Now: NEW GOLD INC.(NGD)

Advisors’ Opinion:

  • [By Dan Caplinger]

    The stock market lost ground on Monday, sending major market benchmarks lower by more than half a percentage point. The Dow lost its grip on the 20,000 mark in the wake of concerns about economic growth and new U.S. immigration policy, and some believe that the broader geopolitical climate could have a negative impact on global commerce that in turn could start affecting multinational corporations’ business prospects. In addition, bad news from some individual companies weighed on the markets, and Transocean (NYSE:RIG), Rite Aid (NYSE:RAD), and New Gold (NYSEMKT:NGD) were among the worst performers on the day. Below, we’ll look more closely at these stocks to tell you why they did so poorly.

Top Gold Stocks To Own Right Now: CME Group Inc.(CME)

Advisors’ Opinion:

  • [By ]

    My pick this week has created a faster, more centralized marketplace for bond traders… and it’s led by a guy who once worked the trading floors of the Chicago Mercantile Exchange (CME). Better yet, recently passed regulations could force traders’ hands in joining this new system.

  • [By ]

    Market Exchanges like the CME Group (Nasdaq: CME) have just started allowing trading in bitcoin futures and could attract an entirely new type of retail user as well as allowing institutional clients access to the bitcoin theme. Exchanges make their money on transactional volume, so a bursting of the bitcoin bubble wouldn’t necessarily mean weakness for shares.

  • [By David Zeiler]

    Bitcoin futures trading started at the CBOE Global Markets Inc. (Nasdaq: CBOE) on Dec. 10 and on the much larger CME Group Inc. (Nasdaq: CME) on Dec. 18. Nasdaq Inc. (Nasdaq: NDAQ) plans to begin trading Bitcoin futures in the first half of next year.

  • [By ]

    CME Group (Nasdaq: CME) is the world’s largest and most diverse futures exchange group, operating in four segments — the Chicago Mercantile Exchange, the Chicago Board of Trade, the New York Mercantile Exchange and the Commodity Exchange.

Top Gold Stocks To Own Right Now: Pilot Gold Inc (PLGTF)

Advisors’ Opinion:

  • [By SEEKINGALPHA.COM]

    Wesdome Gold (OTC:WDOFF) is confirming the potential of its Kiena Deeps discovery with the latest batch of drill results from this venue. Itinerant Musings subscribers who joined us in this trade will be pleased. Treasury Metals (OTC:TSRMF) needs to find more underground ore to justify a construction decision of its Goliath gold project, and it’s doing just that as reported in the latest news release and explained in this article. NuLegacy Gold (OTCQX:NULGF) finally announced results from the twin hole of the Avocado discovery. A detailed discussion will be forthcoming for Itinerant Musings subscribers shortly. Pilot Gold (OTCPK:PLGTF) is making progress at its Goldstrike project in Utah. The latest set of results confirmed the Peg Leg and Covington targets as valid targets for further drilling. Arizona Mining (OTC:WLDVF) is countering controversy by releasing more drill results, and reporting the discovery of Taylor Deeps. The roller coaster continues.

Top 5 Penny Stocks To Own Right Now

I have a well-deserved reputation as a cheapskate. I brown bag my lunches most days, keep my thermostat at 79 degrees, and — if my wife doesn’t intervene — I’ll generally wear my clothes until they’re moth-eaten and threadbare. I’m good with that. As Benjamin Franklin said, a penny saved is a penny earned.

Source: Shutterstock

Perhaps not shockingly, I take the same approach in my investing. I like cheap stocks and, specifically, cheap dividend stocks. I like getting paid in cold, hard cash, after all.

Top 5 Penny Stocks To Own Right Now: Eagle Bulk Shipping Inc.(EGLE)

Advisors’ Opinion:

  • [By Lisa Levin]

    Shares of Eagle Bulk Shipping Inc (NASDAQ: EGLE) were down 49 percent to $0.381. Eagle Bulk Shipping announced after Wednesday’s close it has reached an agreement with its lenders and holders of its equity to raise $105 million.

Top 5 Penny Stocks To Own Right Now: Tyson Foods Inc.(TSN)

Advisors’ Opinion:

  • [By Elizabeth Balboa]

    It’s the same mentality that drove Tyson Foods, Inc. (NYSE: TSN), known primarily for its poultry, beef and pork products, to invest last year in pea protein company Beyond Meat, which produces vegetarian burgers.

  • [By WWW.THESTREET.COM]

    On Monday, Cramer said, he’ll be looking out for Tyson Foods (TSN) , Jack in the Box (JACK) and Palo Alto Networks (PANW) . Tyson is good, but out of favor, Cramer said while remaining bullish on Jack and Palo Alto.

  • [By Lisa Levin] Companies Reporting Before The Bell
    Tyson Foods, Inc. (NYSE: TSN) is expected to report quarterly earnings at $1.38 per share on revenue of $9.86 billion.
    Aecom (NYSE: ACM) is projected to report quarterly earnings at $0.71 per share on revenue of $4.67 billion.
    JD.Com Inc(ADR) (NASDAQ: JD) is estimated to report quarterly earnings at $0.11 per share on revenue of $12.60 billion.
    58.com Inc (ADR) (NYSE: WUBA) is projected to report quarterly earnings at $0.28 per share on revenue of $383.60 million.
    Kamada Ltd (NASDAQ: KMDA) is expected to report quarterly earnings at $0.02 per share on revenue of $25.00 million.
    Palatin Technologies, Inc. (NYSE: PTN) is projected to report quarterly earnings at $0.06 per share on revenue of $28.00 million.
    TheStreet, Inc. (NASDAQ: TST) is estimated to report a quarterly loss at $0.02 per share on revenue of $15.81 million.
    Atlantica Yield PLC (NASDAQ: ABY) is projected to report quarterly earnings at $0.45 per share on revenue of $290.80 million.
    Asure Software Inc (NASDAQ: ASUR) is estimated to report quarterly earnings at $0.15 per share on revenue of $15.26 million.
    Cyren Ltd (NASDAQ: CYRN) is expected to report quarterly loss at $0.06 per share on revenue of $7.90 million.
    Viewray Inc (NASDAQ: VRAY) is estimated to report quarterly loss at $0.12 per share on revenue of $18.58 million.

     

Top 5 Penny Stocks To Own Right Now: NRG Energy Inc.(NRG)

Advisors’ Opinion:

  • [By Rich Duprey]

    I ran a screen to identify the best-performing stocks from the S&P 500 in January. The top three performers during the month were Alcoa (NYSE:AA), CSX (NASDAQ:CSX), and NRG Energy (NYSE:NRG). Let’s see why they were the big standouts and whether they can keep it going.

  • [By Chris Lange]

    The stock posting the largest daily percentage gain in the S&P 500 ahead of the close Thursday was NRG Energy, Inc. (NYSE: NRG) which rose over 5% to $22.20. The stocks 52-week range is $9.84 to $23.36. Volume was over 35 million compared to its average volume of 5.8 million.

  • [By Lisa Levin]

    Non-cyclical consumer goods & services sector was the top gainer in the US market on Wednesday. Top gainers in the sector included Cia Energetica de Minas Gerais CEMIG-ADR (NYSE: CIG), Companhia Paranaense de Energia (ADR) (NYSE: ELP), and NRG Energy Inc (NYSE: NRG).

Top 5 Penny Stocks To Own Right Now: The Hackett Group Inc.(HCKT)

Advisors’ Opinion:

  • [By Lisa Levin]

    In trading on Wednesday, industrial shares were relative laggards, down on the day by about 0.20 percent. Meanwhile, top losers in the sector included The Hackett Group, Inc. (NASDAQ: HCKT), down 22 percent, and PC Tel Inc (NASDAQ: PCTI), down 18 percent.

Top 5 Penny Stocks To Own Right Now: Brocade Communications Systems Inc.(BRCD)

Advisors’ Opinion:

  • [By Lisa Levin]

    Broadcom Limited (NASDAQ: AVGO) and Brocade Communications Systems Inc. (NASDAQ: BRCD) disclosed a definitive deal through which the former would acquire the latter for $12.75 a share in cash. This would translate into a valuation of about $5.9 billion, including $0.4 billion of net debt.