Category Archives: Stocks

by | May 4, 2015 · 5:00 pm

Hitachi expands globally

Internet of Things (IoT) will become the biggest business ever! You can read more about it in my article; The Internet of Things (IoT) dated September 3, 2014. Many companies will try to position them self in the new market. Hitachi is one of them.

Hitachi, Ltd is a diversified company. Information and Telecommunication System segment offers system integration services and automated teller machines. Electricity System segment offers power generation systems. Social and Industrial System segment offers industrial machinery.

Electronic Device and System segment offers liquid crystal displays. Construction segment offers hydraulic shovels and wheel loaders. High Functional Material segment offers electric wires and cables. Automotive System segment offers engine management and in-car information systems.

Digital Media and Consumer Product segment offers optical disk drives and refrigerators. The Others (Logistics and Service) segment provides logistics, real estate related services. Financial Service segment offers leasing and loan services.

 

Hitachi

 

Japan`s $100 billion conglomerate see big opportunity in IoT and expect to earn billions in this business by 2020. Their goal is to enter this business by combining the technology capabilities of their subsidiary Hitachi Data Systems and data from millions of sensors that they already have installed in industrial equipment over the years.

Hitachi is not only trying to focus on industrial solutions but do what others are doing right now; focusing on smart cities and driverless cars. Connected healthcare systems is also a market they want to penetrate.

CEO Hiroaki Nakanishi said Hitachi need to change their business model rapidly.

Hitachi will move from a storage hardware company to a social innovation company. They will offer more IoT solutions and Nakanishi said; «We now need to commercialize these solutions to increase our revenue.»

Hitachi have what it takes to take a big stake in this market, but they need to change to a pure IoT company and try to use the sensor data they have today in their new components that they want to sell in the new market.

CEO Hiroaki Nakanishi is best known as a turnaround business leader, and Hitachi is now looking to pursue global expansion aggressively. Focusing only on becoming Japan`s No. 1 is not enough. Through acquisitions, they want to grow and be bigger in Europe, China and the Middle East.

Hitachi see big opportunities in Europe`s railway sector, and have a track record in the U.K. This is why the company is looking for more businesses to acquire and also enter into strategic partnerships to better penetrate the European market.

They recently inked an 809 million euro deal to acquire rail assets of Finmeccanica, and moved closer to its competitors like Siemens, Alstom and Bombardier in the rail signaling segment. Hitachi hopes the acquisition will help their expansion in Australia, New Zealand, India and the Middle East.

Hitachi is down -8% YTD. Market Cap is 33,33B, and P/E is 15,12. The stock Hitachi, Ltd (OTCMKTS: HTHIY) is trading at $69,00.

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | April 27, 2015 · 11:59 pm

The Apple is getting bigger

Apple is for me the best marketing company on this planet right now. How is it possible to make so many people around the globe to sleep day and night outside to wait for an Apple store to sell their new product?

Apple is a great success in the West but China will become a more important player in the future. Revenue in China grew 71 percent, to $16,8 billion, Apple said in its financial earnings report earlier today.

Revenue in total jumped 27 percent to $58 billion ($45,6 billion in 2014), and their profit for its Q2 jumped from $10,2 billion last year to $13,6 billion in 2015. That`s above Wall Streets estimates, which is awesome.

Apple-Watch-logo-main1

CEO Tim Cook said that their March quarter is the best ever, and reported a higher rate of people switching from Android smartphones to iPhones wich is profitable for Apple. Last year they sold 43,7 million iPhones, but this year they sold 61,2 million.

This is thanks to sales in greater China, which is mainland China, Taiwan and Hong Kong. While iPhones sales goes up, the iPad sales goes down. They sold 16,4 million iPads last year, but now the sale declined to 12,6 million, but what is the difference between an iPad and a big screen iPhone?

Apple`s capital return program increased by 50 percent, using a total of $200 billion in cash by the end of March 2017. The money will be used to increase share repurchases and lift Apple`s dividend.

Apple started to sell Apple Watch on friday and they said the demand is exceeding initial supply. They will reveal sales figures for the new Watch later together with other products. How many units do you think Apple have sold so far? 2 million? 2,5 million? 3 million?

Pebble sold 1 million in one year. Samsung sold 1,2 million last year. This is what Apple have sold in one single day! But how fancy is the Watch market actually? Not as fancy as the mobile phone. 1,2 billion smartphones were sold last year. About 5 – 6 million sold in the smartwatch market I guess.

But the smartwatch market can grow. Yes, of course it can, but I`m in doubt (Sorry Tim Cook). Yes, I know that Apple didn`t sell many iPod`s at the early stage, but it took off and killed the MP3 players from Sony. Now, both are dead.

People was skeptical about the new iPhone too, and said «no BlackBerry-killer.» But we all know the rest of the story. Iphone is a big success. So can the new Apple Watch be. Not only a success in sales volume, but the most profitable too. It depends on how you measure success?

Apple Watch prices start as low as $349 and goes as high as $20,000. You can imagine the margins? I know that Pre-order inventories of the most expensive watch, which is the gold Apple Watch Edition, was sold out in less than one hour in China.

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | April 22, 2015 · 6:43 pm

Tech reports on the way

Earnings reports are back on track again, and this time I will as usual follow tech companies. It is a huge day for tech company earnings tomorrow, and we will see reports from Amazon.com (AMZN), Google Inc (GOOG/GOOGL), Digi International Inc (DIII), Ericsson (ERIC), Verisign Inc (VRSN) and the good old Bill Gates company Microsoft Inc (MSFT).

It is a very important day for Amazon.com tomorrow. More important than their previous reports, and analysts expect a loss of 12 cents per share on a revenue of $22,43 billion. Some people I have talked with expect profits of 1 cent per share.

The most exited issue about the report tomorrow will probably be their AWS (Amazon Web Services) revenue number.

Amazon Prime Air

We will probably see an all time high if the AWS numbers is good, and this is why Amazon.com is some different from Google and Microsoft. Synergy Research Group said Amazon`s AWS has a market share of 28 percent of the global cloud infrastructure market. Microsoft have 10 percent and Google 5 percent, but be aware that we are in an early stage.

Keep in mind that Amazon also can start to deliver packages at the cost of only $1! Last year, Amazon announced Prime Air which is Amazon`s company to deliver packages to the customers by a drone (UAV). If FAA say yes for this business, I think the traditional transport sector will be hit hard and shares of Amazon will fly high. Amazon shares is up 26,8% YTD, trading at $389,53.

Google and Microsoft will both report earnings on thursday, and the big question is; can Microsoft`s Nr. 2 search-engine Bing challenge the internet search giant Nr 1 Google?

Microsoft has been a Nr 2 for a while with 19,8% market share. Google is a clear winner in the U.S search market with a market share of 64,5%.

Google is still big and dominant, but Bing has become a major player in the search market. To compare; Yahoo is the third biggest in the U.S with a market share of 12,8%. AOL; 1,1%. But this is based on desktop search.

Desktop is one thing, but mobile is another. Google dominates the mobile search market with a 93% market share. Bing`s desktop market share can rise up if their Windows 10 are taking off with Bing as a major default search engine, but taking market share in the mobile market will be more difficult.

It will more difficult because Bing has no presence on Apple iOS, nor Android devices.

More exited tech reports and news is coming out. Not only on thursday, but on monday next week. I guess Apple and CEO Tim Cook will talk about Apple Watch on monday. Tim Cook`s first major product launch under his leadership.

Tim Cook is stepping out from Steve Jobs` enormous shadow and Apple Watch officially goes on sale on Friday. Apple haven`t revealed any pre-order sales data, but third-party estimates look great so far.

Any awful news for other smartwatch companies on monday?

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | April 14, 2015 · 11:57 pm

The world`s largest P2P lending marketplace

It is ok to have a credit card, but sometimes it can be very expensive. That is not ok for you, but it is big business for your bank. They will earn a lot of money on you. But what if I say that you can cut your credit card rate by several percentage points?

If you have too much money, what if I say that you can earn 8% on your cash? You are not stupid, so you wouldn`t say no to that. You would be interested in borrowing, but you would be interested in earning an 8% rate on your cash too. You will earn no matter what you do. How is that possible?

SurveySaysNegotiatingCredit1

It`s possible because of the new system called peer-to-peer (P2P) lending.

This is a new platform where borrowers meets lenders with the aim of cutting out banks entirely. It`s more like debt-based crowdfunding, and one of the companies in this business went on the stock exchange at the same time when Alibaba entered the IPO market.

When everybody talked about the Alibaba IPO, nobody talked about the new IPO in the P2P lending market. LendingClub Corporation (LC) entered the market in 2014 and are the world`s largest P2P lending marketplace.

This is a company that started in 2007 and their loan origination have totaled over $7,6 billion from 2007 to 2014. They are small, but they are growing fast, and more P2P lending companies can enter the scene.

Their business model is simple. Lenders receive 13% and after deducting 1% for fees and adjusting for a 4% annual default rate, it`s 8% left to the investor. You will win as an investor, but as a borrower, you will too, because they are competitive to other banks.

Without a doubt, this is a threat to the traditional banking model.

This is a threat to traditional Credit Card Cartel like JPMorgan Chase, Bank of America, American Express, Capital One, U.S Bancorp, Discover and Citigroup. They account for about three-quarters of U.S credit card transactions, so consumer lending is big business.

The financial institutions will try to infiltrate the market.

Santander Consumer USA purchased 25% of LendingClub`s total origination for a term of three years in 2013, and LendingClub have seen a growing influx of capital from institutional investors who have begun to dominate the industry.

That`s hedge funds, asset managers, pension funds and family offices to name a few. An analytics firm called Orchard Platform, that caters directly to institutional investors can help them deploy capital at scale via lending platforms.

The shares of LendingClub Corp rose +4,21% today after announcing partnership with Citigroup Inc and Varadero Capital. What will the bank regulators say to that kind of partnership if this is the trend? Will they require that LendingClub have more of its own capital at risk?

LendingClub will work with Citigroup to provide as much as $150 million in affordable loans to underserved borrowers. The loans will be issued by WebBank, based in Utah, and purchased by Varadero Capital via a credit facility from New York-based Citigroup.

LendingClub and their competitor Prosper Marketplace Inc are leading a technology-driven push to lower borrowing costs, and that`s less than a decade after bad lending decisions led to a global credit crisis. I`m worried right now when I think of where we are in the credit cycle.

We need more competition in the banking sector and Lending clubs can do something with that.

What we see now is bank innovation. Probably a bank revolution.

Online credit marketplaces is the future.

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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by | March 25, 2015 · 11:59 pm

The 5th largest food company in the world

One of the worlds richest and one of the best investors,Warren Buffet, is on the way to build a food empire. Ketchup maker Heinz, backed by Berkshire Hathaway Inc, which is own by Warren Buffet and the private equity firm 3G Capital, which is own by Brazil`s richest man, Jorge Paulo Lemann, will combine with Kraft Foods Group Inc (KRFT.O).

It is a $46 billion deal and that makes it the third largest North American food company. The transaction will create a global food behemoth with annual sales of $28 billion, and Heinz ketchup, Maxwell House coffee, Polly-O Cheese and Jell-O desserts will be some of the brands under its corporate umbrella.

heinz-tomato-ketchup-lid-sterling-silver-hallmarked-ljm

The complicated deal will result in Heinz shareholders owning 51 percent of the company, and Kraft shareholders getting 49 percent. Owners of Kraft shares will also get a hefty $16,50 a share special dividend, funded by the Brazilian firm 3G and Berkshire.

Kraft Heinz will be the fifth-largest food company in the world.

Warren Buffet has long said he want to do more «elephant»-style deals with all the money he has on hand. I think he like food and beverage, because both 3G and Bershire has been fairly acquisitive over the past few years.

They bought Burger King and Tim Hortons, as well as Heinz.

The Dow was losing 300 points today and momentum stocks getting hit harder, so why was the legendary investor Warren Buffet so hungry today, and why hasn`t he lost faith in stocks?

Fist of all; M&A now is lucrative, given ample liquidity and still low-interest rates globally. This is not only happening in the food and beverage industry, but also in tech, health care and biotech industries. I wouldn`t be surprised if that stock catches a further bid on this M&A news.

Berkshire will own more than 300M shares of the new firm and will have paid less than $30 each for them. Naturally, The Oracle has no intention of taking profits. «You won`t see Berkshire reduce is interest,» says Buffet.

«We will be in this stock forever.»

The new company will be publicly traded under the name Kraft Heinz Co, and it expects to save about $1,5 billion in annual costs by the end of 2017. Jorge Paulo Lemann, and his company 3G, has a reputation for introducing aggressive cost cuts at other companies.

Kraft Foods Group Inc is up 35,62% today. Trading at $83,17. Berkshire Hathaway Inc is trading at $217,000 today. EPS; 12,090,84, with a market cap of 356,07B.

It is a shift in the market at the moment as consumers are demanding more healthier food.

Maybe Warren Buffet and Jorge Paulo Lemann will do something with that?

 

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Disclaimer: The views expressed in this article are those of the author and may not reflect those of Shiny bull. The author has made every effort to ensure accuracy of information provided; however, neither Shiny bull nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Shiny bull and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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