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Will CONE Midstream Partners LP (CNNX) Fizzle Or Continue To Sizzle

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Our task today will be to comprehensively evaluate recent data for CONE Midstream Partners LP (CNNX) to determine whether or not we have something approaching a “value” in the market.

In the most basic sense, the “value investing” methodology really has its roots in the college textbook “Security Analysis”, which was published six decades ago by Graham and Dodd. But today, the term “value investing” is generally applied to any approach that focuses first and foremost on the concept of valuation, seeking out viable companies that are “cheap” based on various measures.

In this case, the company’s forward price-to-earnings ratio — perhaps the most common default measure of valuation — is currently at 9.81. That’s based on estimates looking for earnings of 0.41 coming up the pike in the company’s next financial report card.

That said, we all know that the forward data on a stock like this requires faith in those making projections: the analysts. Currently, the forward projections are driven by a group of 6 analysts. And, naturally, no one knows if those 6 folks are way off base for some reason. It’s happened before. That’s why some investing legends only trust the trailing earnings data.

In this case, that valuation ration is sitting right at 10.08.

However, to get a real sense of how this measures up, we will need to dig deeper. Benjamin Graham, the legendary value investor and one of the authors of the seminal text mentioned above, commonly relied on a simple formula for more aggressive investments: Current assets should be at least 1½ times current liabilities, debt should not be more than 110% of net current assets, there should be some level of dividend payments, and the Price-to-book-value ratio should be less than 120% of net tangible assets.

With that in mind, let’s see how CONE Midstream Partners LP (CNNX) stacks up to this challenge.

First off, the company’s current ratio (the ration of current assets to current liabilities) is sitting at 1.41. Remember, according to Graham, that should be at least 1.5. Next, we can see debt-to-equity at 22.17. In addition, if you search the company’s recent dividend rate, you will get 1.11. How about price-to-book ratio? Right now, it clocks in at 2.87.

That should speak to what Graham might say if he came across this stock at its current price. But there are certainly other factors involved in the concept of value in today’s market that should be appreciated.

For example, CONE Midstream Partners LP (CNNX) has managed to generate a return on its assets of 8.81%. That has been achieved through operating margins of 54.84%. Naturally, in the most basic sense, the concept of value is rooted in an ability to generate returns on invested capital. It is fundamentally about gaining access to the machine that has demonstrated its capability to generate those returns, and to do so for a price that is beneath what it is truly worth.

Perhaps the final measure that speaks to this idea is what investors currently have to pay for the company’s sales. In this case, the company’s price-to-sales ratio currently clocks in at 2.48.

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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Stocks To Watch: Lowe’s Companies, Inc. (LOW), Signet Jewelers Limited (SIG), Campbell Soup Company (CPB), Palo Alto Networks, Inc. (PANW)

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The following stocks are set to release their earnings today and need to be on top of your radar. These include Lowe’s Companies, Inc. (LOW), Signet Jewelers Limited (SIG), Campbell Soup Company (CPB), Palo Alto Networks, Inc. (PANW)

In the previous session, stock of Lowe’s Companies, Inc. (LOW) opened at $80.66 and last traded at $80.66 x 300. More than 7,507,099 shares exchanged hands compared to an average daily volume of 6,599,563 shares. At the current pps, the market capitalization stands at 67.84B.

The Analyst Chirp:

Lowe’s Companies, Inc. (LOW) has received an average target price from analysts of $86.29 amounting to a recommendation rating of Overweight. That comes from 31 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 17.23. To give a sense of trend, the same data point on the estimate for next year is currently sitting at 15.14 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 27.00. That shift to 27.00 heading into next quarter.

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. Lowe’s Companies, Inc. (LOW) currently has a Beta value of 0.99 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at Lowe’s Companies, Inc current P/E ratio. Lowe’s Companies, Inc. (LOW) currently has a PE ratio of 23.13. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at Lowe’s Companies, Inc beta and P/E ratio, the EPS cannot be ignored. Lowe’s Companies, Inc EPS for the trailing twelve months was 3.52. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. Lowe’s Companies, Inc is estimated to release its next earnings report on 1 / 2018 (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

 

Technical chart:



 

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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Earnings Preview For Dollar Tree, Inc. (DLTR), Guess’, Inc. (GES), Urban Outfitters, Inc. (URBN), Hormel Foods Corporation (HRL)

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The following stocks are set to release their earnings today and need to be on top of your radar. These include Dollar Tree, Inc. (DLTR), Guess’, Inc. (GES), Urban Outfitters, Inc. (URBN), Hormel Foods Corporation (HRL)

In the previous session, stock of Dollar Tree, Inc. (DLTR) opened at $95.12 and last traded at $99.25 x 100. More than 5,270,702 shares exchanged hands compared to an average daily volume of 2,372,381 shares. At the current pps, the market capitalization stands at 23B.

The Analyst Chirp:

Dollar Tree, Inc. (DLTR) has received an average target price from analysts of $94.17 amounting to a recommendation rating of Overweight. That comes from 26 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 19.92. To give a sense of trend, the same data point on the estimate for next year is currently sitting at 18.01 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 22.00. That shift to 22.00 heading into next quarter.

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. Dollar Tree, Inc. (DLTR) currently has a Beta value of 0.83 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at Dollar Tree, Inc current P/E ratio. Dollar Tree, Inc. (DLTR) currently has a PE ratio of 24.84. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at Dollar Tree, Inc beta and P/E ratio, the EPS cannot be ignored. Dollar Tree, Inc EPS for the trailing twelve months was 3.91. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. Dollar Tree, Inc is estimated to release its next earnings report on 1 / 2018 (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

 

Technical chart:



 

 

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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Will GameStop Corp. (GME) Earnings Surprise Investors ?

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In the previous session, stock of GameStop Corp. (GME) opened at $16.40 and last traded at $16.68 x 300. More than 3,796,717 shares exchanged hands compared to an average daily volume of 2,649,384 shares. At the current pps, the market capitalization stands at 1.67B.

Retailer Offers Holiday Shoppers the Lowest Prices Available on Consoles, Games, Toys and Collectibles

Fundamentals you simply cannot ignore

Investors try to use stocks with high beta values to quickly recoup their investments after sharp market losses. GameStop Corp. (GME) currently has a Beta value of 0.97 . Beta is a measurement of a stock’s price fluctuations, which is often called volatility and is used by investors to gauge how quickly a stock’s price will rise or fall. A stock with a beta of greater than 1.0 is riskier and has greater price fluctuations, while stocks with beta values of less than 1.0 are steadier and generally larger companies. Beta is often measured against the S&P; 500 index. An S&P; 500 stock with a beta of 2.0 produced a 20 percent increase in returns during a period of time when the S&P; 500 Index grew only 10 percent. This same measurement also means the stock would lose 20 percent when the market dropped by only 10 percent. Next, let’s take a look at GameStop Corp current P/E ratio. GameStop Corp. (GME) currently has a PE ratio of 4.95. PE ratio is an important parameter to look at when trading a stock mostly because it is easy to calculate. There are a couple of ways to calculate PE ratio either by dividing share price by earnings per share or dividing the market cap by net income. It is important to note that the earnings are usually taken from the trailing twelve months (TTM). Nevertheless, P/E tells us how much an investor is willing to pay for $1 of a company’s earnings. The long-term average P/E is around 15, so on average, investors are willing to pay $15 for every dollar of earnings. Another useful way to look at this: Turn the P/E ratio around to look at the E/P ratio, which when expressed as a percentage gives us the earnings yield. For instance: 1/15 gives us an earnings yield of 6.67%.

While we have already looked at GameStop Corp beta and P/E ratio, the EPS cannot be ignored. GameStop Corp EPS for the trailing twelve months was 3.32. Traders and investors often use earnings per share (TTM) to determine a company’s profitability for the past year. So in essence, EPS is the amount of a company’s net income per share of common stock. Earnings per share equal the company’s net income less any dividends paid on preferred stock divided by the weighted average number of common stock shares outstanding during the year. GameStop Corp is estimated to release its next earnings report on 1 / 2018 (N/A-Not know at this time). It would be interesting to see how the earnings fair out considering the recent developments.

 

Technical chart:



 

The Analyst Chirp:

GameStop Corp. (GME) has received an average target price from analysts of $22.05 amounting to a recommendation rating of Hold. That comes from 13 different analysts. Perhaps, the driver for that assessment comes from the company’s valuations. Right now, we are looking at a median price-to-earnings ratio for this calendar year of 4.92. To give a sense of trend, the same data point on the estimate for next year is currently sitting at 4.95 times earnings. Drilling down a bit further, this quarter, we are looking at an average estimate from analysts for earnings per share level of 12.00. That shift to 12.00 heading into next quarter.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of argusjournal.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please click HERE

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