Monthly Archives: September 2017

Hurricane Irma takes aim at Florida businesses

Even as Houston struggles to recover from the devastation of Hurricane Harvey, people and businesses in Florida are preparing for massive damage that could accompany the even more powerful Hurricane Irma.

Irma probably won’t reach Florida until the weekend, and it could still curve away. But the state is already steeling itself for the worst.

Tourists have already been ordered out of the Florida Keys starting sunrise Wednesday. Tourism is by far the largest industry on that string of islands, accounting for $2.7 billion of business a year, 60% of spending and 54% of jobs in the county.

While the tourism season has ended in the Keys, authorities and business leaders there worry about the damage Irma could do to hotels and other buildings, and what that might mean when tourism picks up again in December and January.

“We’re just holding our breath and of course hoping it makes a turns back out into the Atlantic,” said Elizabeth Moscynski, president of the Key Largo Chamber of Commerce.

The Florida mainland is also carefully watching forecasts, hoping and preparing. The state’s economy is in relatively good shape: Unemployment is down to 4.1%, lower than the national average. But some already troubled industries are at risk from the hurricane.

Among those is the Flo rida citrus industry. Growers have been struggling with a disease known as citrus greening, which has cut production by about two-thirds in recent years.

This is the start of picking season for the citrus industry. Even if the trees survive strong winds, officials worry the fruit will be stripped off them and a crucial harvest essentially lost.

“The citrus industry here is fighting for its very existence,” said Lisa Lochridge, spokeswoman for the Florida Fruit & Vegetable Association “This is the last thing we need.”

Prices of such commodities as orange juice, cotton and lumber shot higher on Tuesday because of concerns that the storm might cripple supplies.

Orange juice futures, which reflect the prices that wholesalers pay, closed up about 5%, while cotton was up 3.7%. Lumber prices closed up 2.4%. Lumber could become more expensive both because of tighter supply in the Southeast and higher demand for rebuilding after both Harvey and Irma.

Agriculture, fishing and horticulture are worth nearly $150 billion a year to the Florida economy. Other crops might not be as much at risk, but it depends on how the storm hits the state.

“We’re a long way from knowing right now,” said Lochridge. “Obviously the biggest concerns are the winds and water. A little bit of wind or rain is not necessarily a bad thing, but a lot of either would be problem.”

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Rob Pettman has announced that LPL Financial’s robo-offering, Guided Wealth Portfolios, will launch this month.

Pettman, executive vice president of product and platform management, said during Tuesday’s general session at LPL Focus in Boston that the first wave of invitations to the digital platform will go out Aug. 15.

“So first lesson learned is it’s not just for millennials,” he said.

Some advisors in the pilot “really embraced” the platform as an extension to their practice, according to Pettman. “You’ve got a couple that have over 50 accounts already and they’ve been going at it for a couple months,” he said.

At its Focus conference, CEO Dan Arnold shares details about a mobile app for clients and the IBD’s experiments with…

Hot Financial Stocks To Buy Right Now: East West Bancorp Inc.(EWBC)

Advisors’ Opinion:

  • [By Ben Levisohn]

    The twenty stocks in Worth’s basket are: Ameriprise Financial (AMP) Bank of America, Banner (BANR), Citigroup, Citizens Financial Group (CFG), East West Bancorp (EWBC), First NBC Bank Holding (FNBC), HFF (HF), KeyCorp(KEY), Legacy Texas Financial Group (LTXB), Lincoln National (LNC), Morgan Stanley, Old National Bancorp (ONB), PacWest Bancorp (PACW), PNC Financial Services Group (PNC), Principal Financial Group (PFG), Stifel Financial (SF), SVB Financial Group (SIVB), TCF Financial (TCB), and Wells Fargo.

Hot Financial Stocks To Buy Right Now: American International Group Inc.(AIG)

Advisors’ Opinion:

  • [By Ben Levisohn]

    American International Group (AIG) tumbled to the bottom of the S&P 500 today after its earnings fell well short of the Street consensus.

    Agence France-Presse/Getty Images

    AIG dropped 8.9% to $60.85 today, while the S&P 500 gained 0.5% to 2,349.25.

    Yes, AIG’s earnings were bad. It reported an operating loss of $2.72 a share, missing forecasts for a profit of 42 cents, according to Bloomberg. And it didn’t help that John Paulson’s Paulson & Co. cut its stake in the insurer.

    You’ll notice the forecast is different than what it was in my earlier post on AIG–and an AIG spokesperson even reached out to tell me that the consensus, at least according to FactSet, should had been for a loss of 61 cents a share. Why the confusion? RBC’s Mark Dwelle and Scott Heleniak have your answer:

    In reporting results AIG has recast all of its business segments, transferring various pieces to a Legacy unit, reallocating corporate expenses and net investment income as well as making some changes as to what is included within operating income, the most notable of which is that loss reserve discount effects in U.S. Commercial Insurance (and the Legacy unit) are now excluded from Operating Income. Accordingly, comparisons to prior reported results, and to some extent our 4Q16 estimates, require some reconciliation.

    Macquarie’sAmit Kumar considers the bull and bear cases on AIG:

    On 2/14, after market close, AIG reported a Q4 operating loss of $2.72 per share vs. our estimate of a $0.52 loss and street consensus of a $0.54 loss. Results are not directly comparable to street consensus due to lack of unanimity in terms of reserve adjustment estimates. Results included a higher than estimated $5.6 billion or $3.56/share of adverse development. The company had previously announced the possibility of a material reserve charge in the quarter. The bulls on the stock would note that this quar

  • [By Ben Levisohn]

    BMO’s Charles Sebaski explains why he upgraded American International Group (AIG) to Outperform from market Perform:

    Agence France-Presse/Getty Images

    AIG has been trading at discount to its tangible book given its mid-single digit return profile; however, we expect AIGs valuation to keep increasing with its improving return profile. We are now forecasting AIG to generate a 9.9% operating return on tangible common equity (ROtE) in 2018, which would be a 450 bp improvement from 2016. A double-digit return profile warrants the 1x multiple that we are applying to its tangible book value per share. While we expect AIGs return profile to benefit from lower taxes, we also expect the companys life and retirement business to improve from the rising interest rates as those spread businesses are more interest rate sensitive than the P&C business. That said, we expect continued improvement on both the loss and expense sides of the P&C as contributing factors to the ROtE improve.

    BMO also upgraded Arch Capital Group (ACGL), Brown & Brown (BRO), and Travelers (TRV).

    Shares of American International Group have declined 0.4% to $65.60 at 3:36 p.m. today, whileArch Capital Group has gained 2% to $87.90,Brown & Brown has advanced 0.5% to $44.65, andTravelers has risen 1.3% to $120.79.

  • [By Dan Caplinger]

    Wednesday was yet another record-setting day for the stock market, as the Dow climbed triple digits and the S&P 500 and Nasdaq Composite followed the venerable average to unprecedented heights. Economic data showing rising inflation made it more likely that the Federal Reserve will look to boost interest rates at its next Federal Open Market Committee meeting next month, and the ripples throughout the bond market sent many investors to consider stocks instead. Yet despite the substantial rally, some stocks missed out on the move higher, and American International Group (NYSE:AIG), Teck Resources (NYSE:TECK), and Movado Group (NYSE:MOV) 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.

  • [By Ben Levisohn]

    Heading into its earnings following the close of trading yesterday, shares of American International Group (AIG) had gained 34% from its low on Jun. 28 to Feb. 14. Then the bottom fell out.

  • [By Lisa Levin]

    Some of the stocks that may grab investor focus today are:

    Wall Street expects Dr Pepper Snapple Group Inc. (NYSE: DPS) to report quarterly earnings at $1.06 per share on revenue of $1.57 billion before the opening bell. Dr Pepper Snapple shares fell 0.07 percent to close at $93.49 on Monday. Analysts expect American International Group Inc (NYSE: AIG) to post quarterly earnings at $1.01 per share on revenue of $12.87 billion after the closing bell. AIG shares gained 0.38 percent to $66.39 in after-hours trading. Flowers Foods, Inc. (NYSE: FLO) reported in-line earnings for its fourth quarter, while sales missed expectations. Flowers Foods shares fell 1.87 percent to $20.45 in the after-hours trading session. Before the markets open, Diebold Nixdorf Inc (NYSE: DBD) is projected to report its quarterly earnings at $0.32 per share on revenue of $1.31 billion. Diebold Nixdorf shares slipped 0.73 percent to close at $27.20 on Monday.

    Find out what's going on in today's market and bring any questions you have to Benzinga's PreMarket Prep.

Hot Financial Stocks To Buy Right Now: Territorial Bancorp Inc.(TBNK)

Advisors’ Opinion:

  • [By Lisa Levin]

    Territorial Bancorp (NASDAQ: TBNK) shares touched a new 52-week low of $21.31. Territorial Bancorp shares have dropped 9.43% over the past 52 weeks, while the S&P 500 index has gained 16.18% in the same period.

Hot Financial Stocks To Buy Right Now: Virtus Investment Partners Inc.(VRTS)

Advisors’ Opinion:

  • [By Lisa Levin]

    Shares of Virtus Investment Partners Inc (NASDAQ: VRTS) got a boost, shooting up 19 percent to $111.05 following Q3 results. Virtus Investment posted Q3 earnings of $1.64 per share on revenue of $82.3 million.

Benzinga's Option Alert Recap From September 13

Related TPX Tempur Sealy Is Taking Market Share In A Weak Bedding Environment Benzinga's Top Upgrades, Downgrades For August 22, 2017 Tempur Sealy International Trying To Close In On Key Technical Measure (Investor’s Business Daily) Related Under Armour Shoes Stink; Analyst Rates Stock Underperform On Growth Concerns Lululemon Is Gaining Men's Approval, China Is Growing Rapidly

Benzinga Pro provides its subscribers with real-time alerts of potentially market-moving options activity.

Here's a recap of the options alerts from Wednesday, September 13, 2017. All time stamps are in Eastern Time.

3:55:57 pm: TPX Tempur Sealy Jan 19 $70 Calls Sweep (29) at the Ask: 798 @ $2.685 vs 356 OI; Ref=$61.6999

2:43:58 pm: UAA Under Armour Sep 29 $18.5 Puts at the Ask: 2500 @ $0.87 vs 43 OI; Ref=$18.14

2:18:59 pm: JUNO JUNO Oct 20 $45 Puts Sweep (23) at the Ask: 609 @ $3.3 vs 272 OI; Ref=$45.39

1:52:20 pm: CL Colgate Palmolive Oct 20 $75 Calls Above Ask!: 3000 @ $0.5 vs 2055 OI; Ref=$71.8

12:55:32 pm: NVDA Nvidia Mar 16 $130 Calls at the Ask: 10000 @ $45.951 vs 8 OI; Ref=$170.7783

12:15:51 pm: AAPL Apple Oct 27 $150 Puts at the Ask: 587 @ $1.621 vs 308 OI; Ref=$159.0456

12:05:25 pm: IRBT iRobot Fri $92.5 Calls Sweep (3) at the Bid: 510 @ $0.651 vs 141 OI; Ref=$89.275

11:51:58 am: C Citi Sep 22 $69.5 Calls Sweep (24) at the Ask: 846 @ $0.721 vs 500 OI; Ref=$69.43

11:49:58 am: HES Hess Jan 19 $42.5 Calls Sweep (21) at the Bid: 3027 @ $2.905 vs 805 OI; Ref=$42.35

11:36:50 am: AAPL Apple Oct 13 $160 Puts Sweep (2) at the Ask: 2001 @ $4.3 vs 680 OI; Ref=$158.81

11:24:09 am: FRGI Fiesta Rest Gp Oct 20 $17.5 Puts at the Ask: 762 @ $0.651 vs 69 OI; Ref=$17.55

11:22:10 am: HCA HCA Healthcare Jan 19 $80 Calls Sweep (24) at the Ask: 942 @ $3.901 vs 261 OI; Ref=$78.92

11:19:29 am: REN Resolute En Dec 15 $32 Calls at the Bid: 3000 @ $1.75 vs 251 OI; Ref=$28.14

11:09:18 am: PAH Platform Spec Oct 20 $10 Calls Sweep (23) at the Bid: 794 @ $2.0 vs 30 OI; Ref=$11.93

11:01:31 am: C Citi Nov 17 $75 Calls Sweep (31) at the Ask: 1412 @ $0.45 vs 1347 OI; Ref=$69.46

10:52:46 am: HZNP Horizon Pharma Fri $14 Puts Sweep (41) at the Ask: 1000 @ $1.069 vs 279 OI; Ref=$12.96

9:42:05 am: SIG Signet Jewelers Dec 15 $70 Puts Sweep (39) at the Ask: 508 @ $8.472 vs 4 OI; Ref=$68.945

9:39:29 am: HP Helmerich & Payne Oct 20 $50 Calls Sweep (37) at the Ask: 1000 @ $1.4 vs 227 OI; Ref=$48.85

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Nest branches out with alarm system and face-detecting doorbell

Nest wants to keep you from being robbed, as well as help you track your kids and let your dog out to pee at 3 am.

The Alphabet (GOOG) owned company announced a trio of new products on Wednesday, all designed keep your home safe with a combination of motion sensors and constant video monitoring. They include optional face detection to tell who is outside your house, ringing your doorbell, or making waffles in your kitchen.

It’s launching Nest Secure, a home alarm system, Nest Cam IQ, a new version of its outdoor camera, and Nest Hello, a doorbell that includes a tiny security camera. Nest is also adding the ability to talk to Google Assistant through its indoor camera.

Nest Secure security system

The Nest Guard is the hub of the security system. It looks like a decapitated Google Home with a keypad on top, and replaces the usual wall-mounted security keypad. If triggered, the Guard blares its internal alarm.

Use one of the so-called Nest Tags — discs with NFC sensors that go on a keychain — to disarm and arm the system instead of entering a code. If you give a tag to a friend or dog walker, you can program it to only work during certain hours. You can also turn it on and off with the Nest app, or go ahead and enter a code with your human fingers.

In addition to the motion sensor in the Guard, the separate Nest Detect door and window sensors can send alerts to the app or trigger the alarm, as well as detect people walking by. The Detect looks like a little robot finger with a button for a nail, which you can press if you want to open a door without triggering the entire alarm system.

There will be an option for professional round-the-clock monitoring by MONI but no prices have been announced. The Nest Secure system, available in November, will cost $499 for the base, two tags and two door sensors. Extra tags cost $25 each, and sensors are $59 each.

A doorbell that w atches

The Nest Hello doorbell looks like an Amazon Dash button and features a camera that can see who’s at the door. You can get alerts when anyone is at your door and watch them from the app. It will also have optional face detection.

The idea is far from original. Startup Ring currently dominates the connected doorbell market, and August announced its own version earlier this week. To stand out, Nest is adding a Naptime option to mute the ringer for a spell. There’s also an option to reply to the person standing outside with a canned response like “You can leave it, thanks!” in the usual Nest robotic voice.

The device won’t be out until sometime next year, and Nest did not release a price.

Face detection comes to the outdoor camera

Nest Cam IQ outdoor includes features recently added to the company’s indoor camera. It can tell the difference between people and things, and can zoom in and follow subjects. If you pay for the opti onal Nest Aware service, the camera adds face detection, which uses the same technology found in Google Photos. Nest says its face-library is stored separately from Google’s on Nest’s own servers.

The $349 device looks the same as the earlier version, but now you have to drill a hole to connect the power cable, which can be an extra layer of security or a bigger hassle.

Same aesthetic, new direction

It’s been a busy year for the 7-year-old company, which released a cheaper version of its thermostat last month and updated indoor camera in May. However, it has been slow to release original products.

After it was acquired by Google in 2014 for $3.2 billion, Nest struggled with internal drama and complaints about founder and CEO Tony Fadell’s management style. Fadell resigned in 2016, and now the company is being led by Marwan Fawaz, who was previously a technical adviser to home security company ADT.

So far the devices appe ar to be faithful to the Nest brand. They all work together via the app, and have that Nest look. Clean, rounded and boring, like how sci-fi movies imagine rich people live in the future.

Your home is secure, but how about your data?

A house outfitted with Nest products can gather a ton of data about its occupants, including faces if the cameras use face-detection. Michele Turner, a general manager at Nest who has overseen development of the security devices, says the company has gone to great lengths to keep that data safe. In addition to adding “extra layers of encryption,” Nest has gone through a Google security audit.

“Google’s security is probably some of the best in the world, and everything we do passes their security audit,” Turner told CNN Tech. “We execute to their standards.”

The company also will not use or sell the information it collects, says Turner.

“Your data is private. We are fanatical about that.”

Economy Looks Like Early Stages Of An Economic Boom

As I said on Friday, people continue to look for what could bust the economy from here, and are missing out on what looks like the early stages of a boom.

We constantly hear about how the fundamentals don’t support the move in stocks.  Yet, we’ve looked at plenty of fundamental reasons to believe that view (the gloom view) just doesn’t match the facts.

Remember, the two primary sources that carry the megaphone to feed the public’s appetite for market information both live in economic depression, relative to the pre-crisis days.  That’s 1) traditional media, and 2) Wall Street.

As we know, the traditional media business, has been made more and more obsolete. And both the media, and Wall Street, continue to suffer from what I call "bubble bias."  Not the bubble of excess, but the bubble surrounding them that prevents them from understanding the real world and the real economy.

As I’ve said before, the Wall Street bubble for a very long time was a fat and happy one. But the for the past ten years, they came to the realization that Wall Street cash cow wasn’t going to return to the glory days.  And their buddies weren’t getting their jobs back.  And they’ve had market and economic crash goggles on ever since. Every data point they look at, every news item they see, every chart they study, seems to be viewed through the lens of "crash goggles." Their bubble has been and continues to be dark.

Also, when we hear all of the messaging, we have to remember that many of the "veterans" on the trading and the news desks have no career or real-world experience prior to the great recession.  Those in the low to mid 30s only know the horrors of the financial crisis and the global central bank sponsored economic world that we continue to live in today. What is viewed as a black swan event for the average person, is viewed as a high probability event for them And why shouldn’t it?  They’ve seen the near collapse of the global economy and all of the calamity that has followed. Everything else looks quite possible!

Still, as I’ve said, if you awoke today from a decade-long slumber, and I told you that unemployment was under 5%, inflation was ultra-low, gas was $2.60, mortgage rates were under 4%, you could finance a new car for 2% and the stock market was at record highs, you would probably say, 1) that makes sense (for stocks), and 2) things must be going really well!  Add to that, what we discussed on Friday:  household net worth is at record highs, credit growth is at record highs and credit worthiness is at record highs.

We had nearly all of the same conditions a year ago.  And I wrote precisely the same thing in one of my August Pro Perspective pieces.  Stocks are up 17% since.