Incoming Lazard Ltd.
LAZ,
Chief Executive Peter Orszag on Thursday said he plans to steer the investment bank to double its revenue by 2030, according to a letter posted on its website. The investment bank is currently projected to generate about $2.48 billion in revenue in 2023, according to FactSet consensus estimates. Doubling that figure would translate to about $5 billion in revenue over the next seven years. Orszag formally begins work as chief executive on Oct. 1. The firm’s 2030 revenue target would be realized through double-digit revenue growth annually on average, which would be “more in line with how similarly sized peers have grown through the cycle,” Orszag said. The revenue increase will be split about evenly between Lazard’s asset management unit and its advisory business Lazard also plans to average total shareholder return of 10% to 15% per year through 2030. Among the executive changes at the firm, Alexandra Soto, a senior partner, was named as Lazard’s chief operating officer. Chris Weideman will join Lazard as general counsel after working previously at Apollo Global Management Inc.
APO,
Lazard stock was up 1.1% in premarket trades.
Caesars confirms cyber attack, says it has ‘taken steps’ to assure stolen data was deleted
Caesars Entertainment Inc.
CZR,
disclosed Thursday that it has recently identified “suspicious activity” in its information technology network resulting from a “social engineering attack” on an outsourced IT support vendor. The casino operator said it determined that the cyber attacker acquired a copy of its loyalty program database, which includes driver’s license numbers and/or social security number for “a significant number” of members. “We have taken steps to ensure that the stolen data is deleted by the unauthorized actor, although we cannot guarantee this result,” Caesars said. The company said it has incurred, and may continue to incur, certain expenses related to the attack, including expenses to respond to, remediate and investigate the matter. The disclosure comes after The Wall Street Journal reported that Caesars paid roughly half of the $30 million the attackers demanded from the attack, which reports first surfaced over the weekend. the Separately, fellow casino operator MGM Resorts International
MGM,
said Thursday it was still working to resolve a cybersecurity issue. Caesars’ stock rose 0.9% in premarket trading, after falling 4.7% week to date through Wednesday.
Delta Air Lines stock bounces, after profit outlook was cut but revenue view was upbeat
Shares of Delta Air Lines Inc.
DAL,
rallied 2.4% in premarket trading Thursday, to bounce off a three-month low, after the air carrier lowered its third-quarter profit outlook but was upbeat on revenue. The company said it now expects earnings per share for the quarter that ends September of $1.85 to $2.05, down from previous guidance of $2.20 to $2.50, and below the FactSet consensus of $2.31. But revenue is expected to be in the “upper half” of its previous growth guidance of 11% to 14%, while the FactSet consensus of $14.48 billion implies 12.7% growth. Like all the carriers providing updates in the past week, Delta also raised its estimate for fuel costs per gallon, to $2.75 to $2.90 from $2.50 to $2.70. And Delta said non-fuel costs are expected to be up 1% to 2% from last year, above initial guidance, due to higher-than-expected maintenance costs. Delta’s stock had dropped 2.8% on Wednesday to its lowest close since June 8 after rival American Airlines Group Inc.
AAL,
cut its earnings outlook. Delta’s stock has still rallied 20.4% year to date through Wednesday, while the U.S. Global Jets ETF
JETS,
has gained 4.9% and the S&P 500
SPX,
has advanced 16.4%.
AMC stock rises 7.5% in premarket trades
Shares of AMC Entertainment Holdings Inc.
AMC,
continued their rally in premarket trades Thursday, rising 7.5%. The stock ended Wednesday’s session up 8.9% for its largest single-day percentage gain since Aug. 30, when it gained 16.7%. The shares also extended their winning streak to three days after Friday’s record-low close. AMC shares plunged last week after the movie-theater chain and meme-stock darling filed a prospectus for the sale of up to 40 million shares.
SHORT SELLING STOCKS – William O'Neil – How To Make Money Selling Stocks Short (Shorting Stocks)
Cathie Wood’s ARK Innovation ETF sold nearly $14 million worth of Tesla’s stock
Cathie Wood’s ARK Innovation ETF
ARKK,
has sold nearly $14 million worth of Tesla Inc. shares
TSLA,
the ETF’s first sale of the EV maker’s stock in September. But Tesla remains by far the ETF’s largest holding with a weight of 11.38% as of Sept. 14, while 2nd-place Roku Inc.’s
ROKU,
weighting is 8.08%. The ETF said it sold 51,155 shares of Tesla on Wednesday, which based on the closing price of $271.30 would be valued at $13.88 million. That follows the sale of a total of 114,799 Tesla shares in August, which based on the Aug. 31 closing price of $258.08 would be valued at $29.63 million. Tesla’s stock rose 0.7% in premarket trading Thursday. The ETF also said it sold 178,672 shares of DraftKings Inc.
DKNG,
which would be valued at $5.49 million at Wednesday’s close. The digital sports entertainment and gaming company is the ETF’s 8th-largest holding with a weighting of 4.1%. Separately, the ETF said it bought 458,265 shares of Roblox Corp. shares
RBLX,
valued at $12.71 million at Wednesday’s close. The online gaming services company is the ETF’s 17th-largest holding with a 2.87% weighting. The ETF, which gained 0.9% in premarket trading, has run up 39.0% year to date through Wednesday, while the S&P 500
SPX,
has advanced 16.4%.
7 EV Stocks That Will Create Long-Term Millionaires
The EV market is, by now, well established. Investors are well aware of the proliferation of publicly traded EV stocks available.
EV firms are well represented in ETFs and many investors thus have some degree of exposure to the market in general. Yet, it also makes sense to invest directly in individual stocks in the sector across the industry.
Those investors who hold a mix of EV manufacturers, lithium producers, infrastructure players, and even battery recycling firms will do best overall. They’ll be diversified and protected while also being exposed to strong growth overall.
The result is that those who invest in EVs today have every possibility of becoming long-term millionaires.
Tesla (TSLA)
Investors are going to continue to have trouble predicting Tesla (NASDAQ:TSLA) stock. CEO Elon Musk is notoriously unpredictable, which means it’s difficult to know where the firm is headed for long.
Earlier this year, it resulted in lower prices aimed at increasing market share. Pundits then worried that Tesla’s resultant falling margins would negatively affect share prices. That hasn’t been the case, as Tesla has been among the better performers this year.
Now the company is changing tack. It has increased prices on its overhauled Model 3 in China. The Model 3’s range has been increased and its interior improved. It’s also a high-volume seller.
The improvements justify the price hikes and should lead to greater Model 3 sales. That’ll increase margins because it’s a high-volume seller and help to allay greater investor worries.
We will see the results over the short-to-mid term but it remains likely that Tesla will be a long-term winner.
Li Auto (LI)
Li Auto (NASDAQ:LI) stock receives far less attention than its main competitors, Nio (NYSE:NIO) and XPeng (NYSE:XPEV). All three firms are vying to grab as great a share of the EV market in China as possible with the latter two garnering more headline space. However, that’s an opportunity for investors because Li Auto is very much worth investing in.
When you look at Li Auto’s growth figures, you’ll be reminded just how quickly the EV sector is growing in China. Li’s deliveries increased by 202% in Q2. That’s a phenomenal rate of growth but what also impresses is the actual figures.
The firm delivered 86,533 vehicles. That’s a high figure and serves to remind investors that China is a massive market worth considering. Margins are increasing and the firm turned losses into gains during the period. That makes it exactly the kind of growth firm to consider.
The firm anticipates delivering more than 100,000 vehicles in the third quarter, a number that could catalyze greater interest overall.
ChargePoint (CHPT)
ChargePoint (NYSE:CHPT) is reaching a critical point that could result in great progress and improvement of its stock.
Make no mistake, CHPT shares are risky but they’re clearly full of potential at the same time. ChargePoint is falling after releasing second-quarter earnings but continues to possess substantial upside.
Wall Street and Main Street are right to be cautiously pessimistic about ChargePoint’s losses. They increased from $93 million to $124 million in Q2.
The 33% increase in losses doesn’t help ChargePoint at all. Investors are hungry for evidence that the company is moving toward profitability and not away from it. Q2 results indicated the opposite.
That said, there’s reason to believe in ChargePoint and reason for optimism. For one, revenue growth -at 39% – outstripped growth in net losses. Further, the company is restructuring to address growing losses.
It is cutting 10% of its workforce, which is expected to reduce operating expenses by $30 million in Q3. Meanwhile, revenues are expected to be between $150-165 million, or 26% higher at the midpoint in Q3.
My guess is that CHPT stock will make a lot of investors money in Q3 while addressing a few long-term obstacles.
Lithium Americas (LAC)
Lithium Americas (NYSE:LAC) stock is expected to be both a short-term and long-term winner.
In the short term, the firm’s most obvious catalyst is the separation of its operations into two distinct operating entities. Those who invest now will be investing in the Thacker Pass operations in Nevada.
Thacker Pass holds the second-largest lithium deposit on earth. The separation has passed voting and will take effect in October. It’s reasonable to believe that the event will boost share prices.
Thacker Pass is being developed currently. It’s all about potential. That’s clearly the reason that Lithium Americas enacted the separation. Management recognizes the strategic importance of Thacker Pass.
LAC shares will benefit as the development of Thacker Pass continues. It holds enough lithium for 4 plus decades of mining. It is poised to become a major supply chain leader for EV production in the West.
It’s one of the most straightforward and obvious opportunities as North American EVs continue to grow.
Blink Charging (BLNK)
I believe Blink Charging (NASDAQ:BLNK) and its stock are beginning to make a lot more sense to investors.
The opportunity is predicated upon rate cycles, profitability, and the convergence of both for the firm. That combination will make Blink Charging much more attractive in the mid-to-long term.
The company is projecting EBITDA breakeven by the end of 2024. That’s a positive but investors continue to be hesitant of growth firms in this sensitive rate environment. Blink lost more than $41 million in Q2.
Those losses draw more attention now that capital is much more expensive due to rate hikes. Investors care less that revenues increased by 186% during the same period.
However, rate hikes are nearing an end and it’s reasonable to expect rate decreases by late 2024. Remember, Blink Charging should reach EBITDA breakeven by that time.
It’ll be way more attractive because of the combination of profitability and cheaper financing. Growth stocks including BLNK will be much more attractive then.
Li-Cycle Holdings (LICY)
Li-Cycle Holdings (NYSE:LICY) is another EV stock to consider for the long term. The company’s business centers on the emerging issue of battery recycling.
Inevitably, every EV will die. EVs have massive batteries that pose a serious environmental risk. Opponents of the industry argue that the risk invalidates the economic case behind EVs entirely. That’s unlikely.
Instead, battery recycling is an emerging growth opportunity within the broader EV sector. LICY shares are one such opportunity to consider.
The company is developing a spoke-and-hub network from which it expects to produce up to 25,000 tons of lithium carbonate annually. The company is building a global network of recycling facilities. The network spans North America, Europe, Asia.
Spokes refer to pre-processing facilities where end-of-life batteries are processed into a powder from which nickel, lithium, and cobalt are derived. Hubs are processing plants where that powder is processed into battery-grade materials.
Li-Cycle Holdings makes minimal revenues currently but has a first-mover advantage, strong liquidity, and significant future funding from the Department of Energy bolstering its prospects.
Albemarle (ALB)
Albemarle (NYSE:ALB) is, like Lithium Americas, a vital link in the EV supply chain. The firm is currently established whereas Lithium Americas is more of a future bet.
Both are worth considering for those who understand the geopolitical implications of lithium. I won’t belabor that point but domestic lithium production is important and will be important.
Albemarle already sells vast quantities of lithium and is a vital link in the EV supply chain. It’s grown rapidly over the past few years as the EV industry has matured and its sales have grown.
Those sales remain impressive. In Q2, Albemarle’s sales totaled $2.4 billion, an increase of 60%. Lithium demand is strong but commodity prices are also volatile. That makes Albemarle risky and prone to price fluctuations. The result is a beta of 1.55.
Investing in ALB shares is likely to require the patience to ride out the ups and downs but it’s well-connected to the industry and will remain vitally important to the domestic market for a long time.
On the date of publication, Alex Sirois did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
UAW strike could affect auto-parts companies Lear, Magna the most: CFRA
Auto-parts suppliers Lear Corp.
LEA,
and Magna International Inc.
MGA,
are the companies with the “greatest counterparty exposure” to a possible UAW strike, Garrett Nelson at CFRA said in a note Wednesday. “One of the major risks in the event of a prolonged strike is degradation of the supply chain and the financial health of the parts and equipment suppliers,” the analyst said. In contrast, Aptiv Plc
APTV,
and Autoliv Inc.
ALV,
are among the ones with the least exposure, he said. “For the other suppliers, their exposure to the Detroit Three is less clear due to lack of disclosure, and not as substantial as either [Lear or Magna], but it is still significant.” The UAW contract is set to expire at 11:59 p.m. Eastern on Thursday and a gulf remains between the autoworkers’ demands and Ford Motor Co.
F,
General Motors Co.
GM,
and Stellantis NV
STLA,
offers. In what would be a break with tradition, the UAW reportedly is looking at targeted strikes at specific assembly lines of all three auto makers.
7 F-Rated REITs to Sell to Avoid Dividend Disappointments
If you’re an income investor, then you’re probably aware of the benefits of investing in real estate investment trusts, or REITs. But not all REITs are good buys. There are unfortunately several F-rated REITs to sell from which you need to steer clear.
REITs are popular with income investors because they have a structure that’s unique from traditional stocks. They don’t pay federal corporate income tax as long as they distribute at least 90% of their taxable income to shareholders as dividends.
That’s great for investors who are looking for a regular income stream.
The performance of REITs can be affected by the economy, of course. If you think corporations are going to continue to allow employees to work a hybrid or remote schedule, then office REITs probably aren’t a good pick. There are a couple on this list of f-rated REITs to sell.
During the Covid-19 pandemic, hotel and hospitality REITs took a big hit. Consumer confidence can affect residential REITs whether someone is going to own a home or rent. If they can afford to take on a mortgage or pay higher rent on a year-over-year basis.
While there are some fine REITs on the market, each of the equities on this list has some fatal flaws that help lower their grades to an “F” rating in the Portfolio Grader.
Extra Space Storage (EXR)
If you’re downsizing your home, closing down an office or just have too much stuff for your home, then you may use a facility owned by Extra Space Storage (NYSE:EXR).
After completing its merger with Life Storage in June, the Utah-based REIT is the largest storage operator in the U.S., with over 3,500 locations in 43 states.
You expect REITs to have a solid yield, but Extra Space Storage has a yield of less than 2%. The stock performance has been a disappointment, down nearly 14% this year, making it one of the f-rated REITs to sell before it’s too late.
Earnings for the second quarter missed on both top and bottom lines, coming in at $440.75 million in revenue and EPS of $1.50.
I think you can find REITs that will give you better performance. EXR stock has an “F” rating in the Portfolio Grader.
Gladstone Commercial Corporation (GOOD)
Gladstone Commercial Corporation (NASDAQ:GOOD) is an equity REIT, meaning it invests in and owns income-producing real estate.
Gladstone’s role is in single-tenant and anchored multi-tenant industrial and office properties.
The company has 136 properties in 27 states, stretching from Nevada to Massachusetts. Tenants include offices, drugstores, paper companies, industrial complexes and retailers.
Covid-19’s taken a toll on Gladstone, which is working on liquidating its office properties that underperformed so far in 2023 and is focusing on industrial buildings.
That helps explain why GOOD stock is down 28% so far this year. The dividend of 40% a year, paid quarterly, helps, with a yield of 9%. However, the stock gets an “F” rating in the Portfolio Grader.
Medical Properties Trust (MPW)
Medical and hospital REITs are another category of which you can invest. Medical Properties Trust (NYSE:MPW) is perhaps the biggest of these, with over 440 properties and 44,000 hospital beds.
The company operates in 10 countries—the U.S., the U.K., Germany, Switzerland, Spain, Italy, Portugal, Finland, Colombia and Australia.
But bigger isn’t better. Medical Properties Trust is sagging badly in 2023, down more than 40%, making it one of the f-rated REITs to sell ASAP.
The company was the focus of a blistering report in the Wall Street Journal in August that raised questions about the company’s finances.
Second-quarter earnings of $337.4 million were down 15% from a year ago, and missed analysts’ expectations for $348.4 million. Earnings per share was a disaster – analysts expected a profit of 20 cents per share and the company instead reported a loss of 5 cents per share.
The company also cut its dividend nearly in half, from 29 cents per quarter to 15 cents in an effort to build up cash. That’s not what income investors want to hear.
MPW stock gets an “F” rating in the Portfolio Grader.
Crown Castle (CCI)
Crown Castle (NYSE:CCI) can best be described as a telecom REIT. The company owns more than 40,000 cell towers, 85,000 miles of fiberoptic cable and 120,000 on-air or under-contract small cell nodes. The company claims to have a presence in every major market in the U.S.
The company reclassified as a REIT in 2014 for tax purposes, so you can expect to see oversized dividend payments, and CCI delivers with a 6.4% yield.
But why is it a bad REIT to buy? The answer is the headwinds facing the telecom industry these days.
For instance, the investment management company Carillon Tower Advisers issued a note of caution to investors in its second-quarter letter: “Crown Castle detracted from performance as telecom companies have temporarily slowed their deployment of additional cellular spectrum. This slowdown could impair future growth for cell tower companies.”
Analysts downgraded their outlooks for many telecom stocks this summer after reports that many companies own lead-covered cables, a source of potential liability.
CCI stock is down 27% this year and gets an “F” rating in the Portfolio Grader.
Power REIT (PW)
From its name alone, you may think that Power REIT (NYSE:PW) is somehow involved in the utility industry, leasing land to power plants or having ownership in utility lines, wells or pipelines. But you’d be wrong.
Power REIT is instead in the sustainable real estate business. The company has greenhouses, and solar farmland where it grows food and cannabis. It also has a wholly owned subsidiary, the Pittsburgh & West Virginia Railroad, that includes 132 miles of railroad leased to Norfolk Southern (NYSE:NSC).
But this hasn’t been a good year for Power REIT. Shares are down 65% this year. Revenue in the second quarter was only $217,000, a drop of 90% from a year ago. The company also lost $2.19 million in the quarter, or 69 cents per share.
And this is a REIT that doesn’t pay a dividend. Tt hasn’t issued a payout since January 2013. What’s the point of owning a REIT that doesn’t offer an incentive to income investors?
PW stock has an “F” rating in the Portfolio Grader.
Agree Realty (ADC)
Agree Realty (NYSE:ADC) is a Michigan-based retail REIT. The company has more than 2000 properties that include grocery stores, pharmacies, automotive retailers, used car lots, convenience stores and fast-food restaurants.
Agree also stands out on this list because instead of paying a quarterly dividend, it has a monthly payout. That could be enticing for investors wanting a consistent income stream, and the current payout is 4.8%.
But ADC also suffers from headwinds in the retail sector. Some commercial real estate is suffering from rising interest rates. Brick-and-mortar retailers are under significant pressure. And as the economy suffers, it’s reasonable to expect that some of these businesses working with ADC will also suffer.
Agree Realty stock is down 15% this year and gets an “F” rating in the Portfolio Grader.
Ashford Hospitality Trust (AHT)
Ashford Hospitality Trust (NYSE:AHT) is a hotel and hospitality REIT. The Dallas-based company owns full-service hotels in 25 states and the District of Columbia.
But not all is well in the hotel business, which suffered mightily during the Covid-19 pandemic. Even though travelers are returning, Ashford continues to have some struggles.
In July, Bloomberg reported that Ashford was planning to return 19 hotels to lenders, saving $225 million in required debt payments and $80 million in needed capital expenditures. The hotels weren’t performing well enough to cover the REIT’s 8.8% interest rate on the loans, Bloomberg said.
The company brought in revenues of only $375.5 million in the second quarter, up 8% from a year ago. And the stock price is down 32% in 2023.
Ashford is also one of those puzzling dividend stocks that don’t pay a dividend – this REIT hasn’t made a payment to investors since January 2020. For that and other reasons listed here, AHT gets an “F” rating in the Portfolio Grader.
On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.
Howard Schultz steps down from Starbucks board of directors
Starbucks Corp. on Wednesday said former Chief Executive Howard Schultz is stepping down from its board of directors, capping a nearly 40-year career during which the company grew from a handful of stores in Seattle into a global coffee chain.
Schultz’s retirement from the board, which ends his involvement in the company’s leadership, took effect Wednesday and was part of a planned transition, the coffee chain said. Schultz stepped down as Starbucks
SBUX,
chief executive in March.
The company on Wednesday also said that it had elected Wei Zhang to its board of directors, effective Oct. 1. Zhang was most recently a senior adviser to Chinese e-commerce giant Alibaba Group
BABA,
and also held leadership positions at News Corp China and CNBC China.
Shares of Starbucks were down 0.7% after hours on Wednesday.
Starbucks said Schultz “will now turn his attention with his wife, Sheri, to focus on a range of philanthropic and entrepreneurial investments to create greater opportunity, accessible to all.” The company noted that the two were co-founders of the Schultz Family Foundation in 1996, and of the emes project.
Although he was not technically the founder of the coffee chain, Schultz became the modern face of it. Schultz joined Starbucks in 1982 as its director of operations and marketing. After a brief hiatus from the company, he returned in 1987 as chief executive and bought the business with backing from local investors, according to a biography on the Starbucks website. The chain went public in 1992.
As the chain’s footprint expanded beyond the U.S., Schultz stepped down from the CEO role in 2000 but returned in 2008. He retired from Starbucks in 2018, then came back as interim chief executive and board member last year.
Over those years, Starbucks has banked on China for international growth — even as that country’s economy remains turbulent following the postpandemic reopening. It also added food and cold and customizable drinks to its menus and built out its mobile-ordering infrastructure.
The company has branded itself as a progressive employer and a supporter of social justice. But over the past two years, the company, and Schultz in particular, have faced criticism over the handling of employees who were trying to unionize. Union members have accused the chain of unfair labor practices, retaliation for organizing and delaying contract negotiations, leading to deeper scrutiny from lawmakers.
“We hope this is an opportunity for Starbucks to change course and leave their union-busting behind them,” Starbucks Workers United, the union representing those workers, said Wednesday in a tweet.
Still, even as inflation has eaten into consumer savings, Schultz said coffee has remained an “affordable luxury” for many customers. And Starbucks management said that younger, loyal consumers and customizable drinks would help sustain demand.
According to a filing on Wednesday, Schultz will still be connected to the company in other ways. Starbucks said it would amend Schultz’s retirement agreement from 2018 and continue to provide him and his spouse with security services.
“The security services will be provided for a period of 10 years and will be evaluated on an annual basis,” the filing said. “In recognition of Mr. Schultz’s leadership as the company’s founder and chairman emeritus, the company will also provide Mr. Schultz with the reimbursement of his monthly healthcare insurance premiums.”