Tag Archives: VALE

Top Undervalued Stocks To Invest In 2018

The steel industry is garnering a lot of attention this year due to expectations of increased economic activity and the President’s announcement that new oil and gas pipeline construction will be built with U.S.-manufactured steel, observes Crista Huff, editor of Cabot Undervalued Stocks Advisor.

I’m adding Schnitzer Steel Industries (SCHN) to the Buy Low Opportunities Portfolio. Schnitzer Steel is both a recycler of scrap metals, and a manufacturer of steel products that are used in nonresidential construction.

The company also owns over 50 stores that sell used auto parts. Schnitzer is based in Oregon and exports 60% of its steel products to international destinations. The company is run by a woman who has an investment banking background. Schnitzer is considered to be well managed and benefiting from a recent focus on cost cutting.

Schnitzer’s full-year 2016 earnings per share were $0.48 (August year-end). Wall Street expects $1.21 and $1.48 EPS in fiscal 2017 and 2018, representing earnings growth of 152% and 22.3%. The corresponding P/Es are 19.6 and 16.0. The company’s long-term debt-to-capitalization ratio is 27%, down from 32% three years ago. Schnitzer last announced a quarterly dividend increase in April of 2012. The current yield is 3.1%. The number of basic shares outstanding has been relatively unchanged over the last five years. 91% of those shares are held by financial institutions, which means that professional investors think that SCHN is a good investment.

Top Undervalued Stocks To Invest In 2018: Westar Energy, Inc.(WR)

Advisors’ Opinion:

  • [By Lisa Levin]

    In trading on Thursday, utilities shares fell by 0.34 percent. Meanwhile, top losers in the sector included Westar Energy Inc (NYSE: WR), down 7 percent, and Companhia de Saneamento Basico (ADR) (NYSE: SBS), down 5 percent.

  • [By Lisa Levin]

    On Thursday, utilities shares rose by 0.02 percent. Top gainers in the sector included Westar Energy Inc (NYSE: WR), Westar Energy Inc (NYSE: AT), and NRG Energy Inc (NYSE: NRG).

  • [By Jayson Derrick]

    According to a report by Bloomberg, Westar Energy Inc (NYSE: WR) is a potential takeover target from rival Ameren Corp (NYSE: AEE) and a consortium of investors, including Toronto-based Borealis Infrastructure Management and the Canada Pension Plan Investment Board.

  • [By Dan Caplinger]

    Yet even on a good day, some stocks couldn’t keep up, and Ocwen Financial (NYSE:OCN), Westar Energy (NYSE:WR), and United Rentals (NYSE:URI) were among the worst performers. Below, we’ll look more closely at these stocks to tell you why they did so poorly.

Top Undervalued Stocks To Invest In 2018: Vanguard Extended Duration Treasury ETF (EDV)

Advisors’ Opinion:

  • [By Todd Shriber, ETF Professor]

    The 11 ETF fee cuts unveiled by Vanguard include a significant portion of the issuer's fixed income lineup. All of the following saw annual fees reduced to 0.07 percent from 0.1 percent:

    Vanguard Extended Duration Treasury ETF (NYSE: EDV). Vanguard Intermediate-Term Bond ETF (NYSE: BIV). Vanguard Intmdte Tm Govt Bd ETF (NASDAQ: VGIT). Vanguard Long Term Corporate Bond ETF (NASDAQ: VCLT). Vanguard Lg Term Govt Bd ETF (NASDAQ: VGLT). Vanguard Mortgage Bkd Sects ETF (NASDAQ: VMBS).

    and the Vanguard Short Term Corporate Bond ETF (NASDAQ: VCSH).

Top Undervalued Stocks To Invest In 2018: 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.

Top Undervalued Stocks To Invest In 2018: VALE S.A.(VALE)

Advisors’ Opinion:

  • [By Ben Levisohn]

    Mosaic (MOS) tumbled to the bottom of the S&P 500 today after announcing that it would buy Vale’s (VALE) fertilizer unit.

    Getty Images

    Mosaicdropped 1.1% to $27.77 today, while the S&P 500 advanced 0.2% to 2,262.53.

  • [By Craig Jones]

    On CNBC's Fast Money Halftime Report, Jon Najarian spoke about unusually high put options activity in Arconic Inc (NYSE: ARNC) and Vale SA (ADR) (NYSE: VALE).

Fridays Vital Data: Time Warner Inc. (TWX), Wells Fargo & Co (WFC) and Vale S.A. (ADR) (VALE

U.S. stock futures are headed for record territory in the last day of trading before Christmas. Wall Street is continuing to cheer the passage of the Republican tax plan, which only needs President Donald Trump’s signature to become law. Already, AT&T Inc. (NYSE:T) and Wells Fargo & Co (NYSE:WFC) have pledged to raise wages and pay out bonuses if the legislation is signed this year.

Friday’s Vital Data: Time Warner Inc. (TWX), Wells Fargo & Co (WFC) and Vale S.A. (ADR) (VALE)Meanwhile, traders will be flooded with data before leaving to spend time with their families. Economic reports today include durable goods orders, core capital orders, personal income, and consumer spending and core inflation for November, as well as November new-home sales and the December consumer sentiment reading.

Heading into the open, futures on the Dow Jones Industrial Average are down 0.01%, S&P 500 futures have added 0.02% and Nasdaq-100 futures have lost 0.02%.

Options volume was below average on Thursday, as many traders appear to have already left for home. Overall, about 15.6 million calls and 11.7 million puts changed hands on the session. The CBOE single-session equity put/call volume ratio heald at 0.56 and the 10-day moving average ticked lower to 0.56, yet another 52-week low.

Drilling down on Thursday’s options activity, Time Warner Inc (NYSE:TWX) attracted several large call blocks yesterday, with one spread betting heavily on a successful buyout from AT&T. Meanwhile, options traders are signaling that Wells Fargo may be an underdog banking stock following the passage of the Republican tax plan, and Vale S.A. (ADR) (NYSE:VALE) trades ex-dividend today.

Friday’s Vital Options Data: Time Warner Inc. (TWX), Wells Fargo & Company (WFC) and Vale S.A. (VALE)investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-300×138.png 300w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-65×30.png 65w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-200×92.png 200w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-400×184.png 400w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-116×53.png 116w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-100×46.png 100w,https://investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-109×50.png 109w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-78×36.png 78w, investorplace.com/wp-content/uploads/2017/12/12-22-2017-Top-Ten-Options-170×78.png 170w” sizes=”(max-width: 546px) 100vw, 546px” />

Time Warner Inc. (TWX)

Since the deal was announced last year, TWX stock has bounced around well below AT&T’s proposed purchase price of $107.50 per share. Uncertainty is the main reason for TWX not rallying to within reach of AT&T’s offer, with Justice Department scrutiny and the current lawsuit remaining a cloud over the deal.

However, optimism that the deal will go through has risen in recent weeks, and TWX options traders are beginning to bet on a positive outcome. TWX volume yesterday rose to over 193,000 contracts, or more than four times the stock’s daily average. Calls gobbled up 73% of the day’s take.

One trader took that optimism to another level, however. According to Trade-Alert.com, blocks totaling 30,000 contracts and marked “spread” traded on each of TWX’s July $82.50 put, $95 call and $105 call. The $95 calls purchased, while both the other contracts were sold. The total outlay for this spread was $1.34, or $134 per trio of contracts.

Assuming these contracts crossed as marked, and were a spread, the trader could pocket $866 per contract if TWX trades at or above $105 when July options expire — a strike that is just below AT&T’s purchase price.

Wells Fargo & Company (WFC)

WFC stock was left behind in the banking sector’s tax-plan driven run higher this year. The shares have added a mere 15% compared to the Financial Select Sector SPDR ETF’s (NYSE:XLF) gain of roughly 30%. But WFC stock traders are beginning to finally come around as the tax plan heads toward implementation. In fact, analysts at Buckingham upgraded WFC to “buy” from “neutral” on the news, lifting WFC’s price target to $75 from $57.

Options traders were also in a bullish mood yesterday. Volume on WFC rose to 145,000 contracts, with calls making up 81% of the day’s take. There is still some acceptance to be had among speculative traders, as the January 2018 put/call open interest ratio rests at an elevated reading of 0.81 for WFC. That reading should drop sharply in the coming weeks, however, as more traders realize the potential upside for WFC stock following the tax plan’s passage.

Vale S.A. (VALE)

It’s ex-dividend day for Vale. The Brazilian mining company is set to pay out a quarterly dividend of 9.8 cents per share on March 22, 2018. Shareholders of record by the close last night are eligible for the dividend payout.

As a result, VALE stock was flooded with call activity yesterday, as options traders sought to capture the quarterly payout. Volume topped 163,000 contracts, and calls accounted for 93% of the overall activity. Options traders typically buy in-the-money calls as a way to gain control of a stock ahead of its ex-dividend date, resulting in heavy dividend-capture activity the day prior.

As of this writing, Joseph Hargett did not hold a position in any of the aforementioned securities.

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Americo Introduces a Single-Premium Immediate LTCI Policy

A long-running lawsuit between the Trump administration, House Republicans and Democratic attorneys general over billions of dollars of Affordable Care Act public exchange plan subsidies has been settled, according to an agreement filed in federal court Friday.

The settlement agreement, details of which weren’t available in the filings but described as “conditional,” could pave the way for eventual payment of the cost-sharing reduction payments, or CSRs. The CSRs had been paid to health insurers as a way to subsidize some lower-income patients’ insurance co-payments and deductibles, allowing them easier access to health care.

(Related: ACA Mandate Clobbers ACA Subsidy: CBO)

The Trump administration had stopped making the payments, throwing the Affordable Care Act’s markets into chaos and causing premiums to rise, and state Democratic attorneys general continued the legal effort to try and preserve the subsidies.

candlestick chart: Investment Technology Group, Inc.(ITG)

Advisors’ Opinion:

  • [By Jon C. Ogg]

    Investment Technology Group Inc. (NYSE: ITG) was downgraded to Market Perform from outperform by KeefeBruyette & Woods.

    Liquidity Services Inc. (NASDAQ: LQDT) was raised to Buy from Underperform, and the price target was raised up to $45 from $28.50, at Merrill Lynch.

candlestick chart: Nu Skin Enterprises Inc.(NUS)

Advisors’ Opinion:

  • [By Ben Levisohn]

    Citigroup’s Beth Kite calls Nu Skin Enterprises’ (NUS) earnings and guidance “awfully disappointing.” She explains why:

    “Frustrating” Describes 4Q15 & 2016 Guidance:Nu Skin (i) reported 4Q15 EPS of $0.62, 11 cents below consensus and us, and (ii) lowered 2016 EPS guidance, from $3.25-$3.40 to $2.40-$2.60.Nu Skin had three LTO’s in 4Q152 succeeded and 1 failed. The failure had far less to do with the product than with the sales strategy…

    Is Guidance Too Conservative or Is It Really This Bad? We get that Me failed to sell well in South Korea with the 12-month cartridge commitment. But given the strength in reps globally, the strength of Youth from its two LTOs in 2H15, and good results from Me when sold in Japan without the 12-month commitment, we wonder if guidance is aggressive to the downside. Indeed, the word “conservative” was said a lot by mgmt on the brief earnings call when describing guidance revisions.

    Maintaining Buy: While we now have less confidence in mgmt, from an external perspective, to forecast its results accurately, and from an internal perspective, to course correct quicklyi.e., why didn’t they drop the 12-month plan for Me in South Korea when it so obviously wasn’t workingwe are still confident in Youth & Me. The rep growth in South Asia/Pacific from Youth in 3Q led to better 4Q sales than we’d expected, Youth’s Americas LTO in 4Q drove lc sales up 26% YoY, and Me not only sold through in Japan in 4Q but also drove reps higher. We imagine that investors may have little patience or confidence in Nu Skin for a while, understandably. But the bar seems set fairly low now, so we are cautiously optimistic that Nu Skin can dig itself out of this hole as we go through 2016 and Me & Youth roll out more fully.

    Shares of Nu Skin have tumbled 13% to $27.31 at 2:11 p.m. today.

  • [By Roberto Pedone]

    Nu Skin Enterprises (NUS) is a direct selling company, which develops and distributes personal care products and nutritional supplements that are sold under the Nu Skin and Pharmanex brands. This stock closed up 5.4% at $92.96 in Monday’s trading session.

    Monday’s Volume: 2 million

    Three-Month Average Volume: 900,802

    Volume % Change: 85%

    From a technical perspective, NUS ripped higher here right above some near-term support at $85 with heavy upside volume. This move pushed shares of NUS into breakout and new 52-week-high territory, since the stock took out some near-term overhead resistance levels at $88.20 to $89.69. This move also pushed shares of NUS above the upper-end of its recent range that saw the stock trend between $82 to just above $89.

    Traders should now look for long-biased trades in NUS as long as it’s trending above support at $85 and then once it sustains a move or close above Monday’s high of $93.33 with volume that this near or above 900,802 shares. If we get that move soon, then NUS will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that move are $100 to $105.

  • [By Scott Rubin]

    Stock gainers included Mercadolibre Inc (NASDAQ: MELI), up almost 14 percent, and Nu Skin Enterprises, Inc. (NYSE: NUS), which added 12 percent. The positive gains in both stocks were due to strong earnings reports. Shares of Liberty Interactive Group (NASDAQ: QVCA) plunged almost 22 percent on Friday due to disappointing sales growth in its fiscal second quarter. Pharmaceutical giant Bristol-Myers Squibb Co (NYSE: BMY) lost 16 percent after a disappointing study involving its Opdivo drug.

  • [By Craig Jones]

    Nu Skin Enterprises, Inc. (NYSE: NUS) is trading sharply higher on Friday, but options traders are buying puts in the name, said Jon Najarian. Traders were buying the June 50 puts and they paid around 6 percent for them, so they don't see much upside in Nu Skin Enterprises, explained Najarian. He followed the trade and he is planning to hold the position for a month.

candlestick chart: Vanguard Extended Duration Treasury ETF (EDV)

Advisors’ Opinion:

  • [By Todd Shriber, ETF Professor]

    The 11 ETF fee cuts unveiled by Vanguard include a significant portion of the issuer's fixed income lineup. All of the following saw annual fees reduced to 0.07 percent from 0.1 percent:

    Vanguard Extended Duration Treasury ETF (NYSE: EDV). Vanguard Intermediate-Term Bond ETF (NYSE: BIV). Vanguard Intmdte Tm Govt Bd ETF (NASDAQ: VGIT). Vanguard Long Term Corporate Bond ETF (NASDAQ: VCLT). Vanguard Lg Term Govt Bd ETF (NASDAQ: VGLT). Vanguard Mortgage Bkd Sects ETF (NASDAQ: VMBS).

    and the Vanguard Short Term Corporate Bond ETF (NASDAQ: VCSH).

candlestick chart: VALE S.A.(VALE)

Advisors’ Opinion:

  • [By Craig Jones]

    On CNBC's Fast Money Halftime Report, Jon Najarian spoke about unusually high put options activity in Arconic Inc (NYSE: ARNC) and Vale SA (ADR) (NYSE: VALE).

  • [By Ben Levisohn]

    Mosaic (MOS) tumbled to the bottom of the S&P 500 today after announcing that it would buy Vale’s (VALE) fertilizer unit.

    Getty Images

    Mosaicdropped 1.1% to $27.77 today, while the S&P 500 advanced 0.2% to 2,262.53.

candlestick chart: Intercontinental Exchange Inc.(ICE)

Advisors’ Opinion:

  • [By WWW.THESTREET.COM]

    In the Lightning Round, Cramer was bullish on Altria (MO) , Intercontinental Exchange (ICE) and Micron Technology (MU) .

    Cramer was bearish on NVIDIA (NVDA) and Reynolds American (RAI) .

candlestick chart: Vanda Pharmaceuticals Inc.(VNDA)

Advisors’ Opinion:

  • [By Roberto Pedone]

    Another biotechnology player that looks poised to trigger a big breakout trade is Vanda Pharmaceuticals (VNDA), which is focused on the development and commercialization of clinical-stage drug candidates for central nervous system disorders. This stock has been on fire so far in 2013, with shares up a whopping 258%.

    If you take a look at the chart for Vanda Pharmaceuticals, you’ll notice that this stock has recently broke out above some near-term overhead resistance levels at $12.34 to $12.66 a share with solid upside volume. So far, this breakout has held and now shares of VNDA are quickly moving within range of triggering an even bigger breakout trade.

    Traders should now look for long-biased trades in VNDA if it manages to break out above its 52-week high at $13.30 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action 908,467 shares. If that breakout hits soon, then VNDA will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are $15 to $17 a share.

    Traders can look to buy VNDA off any weakness to anticipate that breakout and simply use a stop that sits right below some near-term support at $12 a share. One could also buy VNDA off strength once it takes out $13.30 a share with volume and then simply use a stop that sits a comfortable percentage from your entry point.

The Likely Rise Of Electric Vehicles And The Impact On Metals

The take-up of electric vehicles (EVs) may well be in a growth pattern which could rival that of the price of bitcoin, but is unlikely, like the latter to push sales into bubble territory. As range anxiety and long charging times recede into obscurity with the enormous developments in battery technology, the environmental, and ultimately the cost, benefits of electric drive for automobiles over internal combustion engine (ICE)-driven small vehicles is likely to become paramount.

The potential exponential growth pattern for EV sales will have likely an enormous impact on the sales volume, and price, of the metals utilized in EV production. These are notably lithium, cobalt, manganese, nickel, graphite, and some rare earths in battery manufacture, copper (an electric vehicle utilizes far more copper than a conventional ICE-driven vehicle) and perhaps aluminum to keep body panel weight down – and maybe as a substitute for copper in electrical wiring systems. Conversely, the longer term future for platinum group metals, predominantly utilized in ICE engine exhaust cleaning catalysts may well be bleak, and we see a serious downturn for these commencing in the next decade – and getting worse from there.

We thus see several major keys necessary to stimulate the more general take-up of EVs, rather than plug-in hybrids (PHEVs). The first, and most important, is ever-improving battery technology, perhaps coupled with the expansion of a nationwide fast charging network to handle distance driving demand. Range anxiety will be countered by battery life improvements, while an interim solution could be the inclusion in EVs of small range extending ICEs designed primarily to charge the batteries rather than for driving the vehicles.

Up until the current year, there were few EVs on the market capable of achieving a range of much more than 100 miles, but this is changing now quite rapidly, although the 300-400 miles of range between charges, which is probably necessary to achieve true sales lift-off, is mainly only available at the high end of the price range. But every time a new model is announced, range tends to be one of the aspects which is being expanded. We would anticipate 250-350 mile range to be the norm, rather than the exception, even in many low-end EVs by the end of the current decade.

So, if one looks at the extremely rapid pattern of technological battery improvement in computers and in mobile phones, there has to be the likelihood that battery technology research will continue to raise vehicle range between charges, and reduce costs as a combination of technological advance and scale of production leads to savings here. No doubt rapid charging technology will also develop alongside, as will the installation of more and more charging points across the nation – this being the other main bugbear, along with vehicle cost, affecting EV take-up. Ultimately, we suspect that far greater ranges may become the norm – maybe even 1,000 miles on a single charge before too long, certainly for high end vehicles.

This would likely be a nail in the coffin of the internal combustion engine (ICE) as would likely increasing legislation to ban ICE-driven vehicles from urban areas which we are already seeing in some major cities around the world as urban administrations in particular do battle with air pollution, to which gas and diesel driven vehicles are a major contributor. Indeed some nations are already looking to ban sales of ICE-driven vehicles. Norway, for example, is proposing to ban all fossil-fuelled cars from its roads. As the UK’s Guardian newspaper reports, Norway already has the highest per capita number of all-electric [battery only] cars in the world: more than 100,000 in a country of 5.2 million people. In 2016, EVs constituted nearly 40% of the nation’s newly registered passenger cars. And the Norwegian experiment shows every sign of accelerating. Earlier this year, Norway opened the world’s largest fast-charging station, which can charge up to 28 vehicles in about half an hour. The country, joined by Europe’s No. 2 in electromobility, the Netherlands, intends to phase out all fossil fuel-powered automobiles by 2025.

New types of battery technology may also be a factor here. At the moment most, if not all, EVs run on lithium-ion technology, but research is under way into so-called solid-state batteries which offer (in theory at least) lighter weights, longer ranges, shorter charging times, and lower costs than current standard lithium-ion batteries. But so far, the technology has not been able to be transferred from the laboratory to the kind of size necessary to drive a full-size EV efficiently. Even with lithium-ion technology, though, Elon Musk’s Tesla (NASDAQ:TSLA) – perhaps the principal driver in the advance of EV design and implementation – is achieving a claimed 600 mile range between charges in some of its latest, currently available high-end vehicles – and is already on the way to achieving this on its ‘affordable’ Model 3 range.

Tesla has also announced an all-electric semi truck which appears expensive in relation to diesel driven trucks but claims a 2-year cost payback, given how much cheaper it is to run an all-electric vehicle than an ICE-powered one, and performance and range figures are impressive. Tesla also claims driver environment and substantial safety benefits for its semis. PepsiCo (NYSE:PEP) has already ordered 100 of these and expects to start taking delivery by 2019/20.

Other manufacturers are also planning to produce and sell all-electric trucks by the end of the current decade – Reuters reports that Navistar International Corp. (NYSE:NAV) and Volkswagen AG’s (OTCPK:VLKAF) Truck and Bus are working together to launch an electric medium duty truck by late 2019, while rival Daimler AG (OTCPK:DDAIF) has delivered the first of a smaller range of electric trucks to customers in New York. These are designed for shorter ranges than the Tesla semi but will likely see expanded ranges as battery technology advances.

Re the solid state battery, in the UK, Sir James Dyson, of vacuum cleaner fame, is working to develop a Dyson EV by 2020 and is reportedly putting 拢2.5 billion towards its development. Dyson is also reportedly nailing his colors to the solid-state battery mast, although again whether a solid state battery sufficient to power an EV will be available in that timescale remains to be seen!

Japanese mainstream auto manufacturer Toyota (NYSE:TM) also reckons to be working on a solid-state battery-driven EV which it hopes to have on the market in the early 2020s. Undoubtedly, other mainstream manufacturers, virtually all of whom are working on EV design and production, will also be looking at the potential of solid state batteries because if they can be produced commercially will, eventually, offer the range, rapid charging and lower costs required to make EVs the norm rather than the exception.

With the kinds of technology growth patterns we have been seeing, we would anticipate total EV dominance of the automobile market far faster than recent projections might suggest – perhaps within 20 years. Already Volvo (OTCPK:VOLAF) has announced that every new car it launches from 2019 will have an electric motor (this will include hybrids so is not phasing out the ICE totally – yet – but is an indicator of the way the market is trending).

While battery technology/range is perhaps the most important factor for EV manufacture and sales going forward, cost is another hugely important factor. Despite the apparent drive-train simplicity of electric-powered vehicles, those on the market at the moment are much more costly than similar-sized conventional vehicles, and only attractive through the availability of government subsidies. Insurance costs are higher too.

But there are some other key advantages of electrically driven vehicles which will be major sales points assuming battery technology factors can be overcome – which they will be. Rapid torque availability – which means very fast acceleration – the far easier integration with new computer technology, potentially far lower running costs and the convenience of home charging, for those with that possibility, or with easy access to overnight charging points, rather than having to fill up at a gas station are all key points. But most of all the perceived environmental benefits of electric drive over ICE-driven vehicles are becoming paramount.

The capital and maintenance costs for EVs are likely to come down as take-up increases, but it may take time, and the continuation of subsidies until the market has truly taken off is probably key for any serious short-term growth momentum

Model Availability

Suffice it to say that the numbers of EVs available to the market will be increasing exponentially over the next few years with most mainstream manufacturers offering all-electric models already. However, one does have to credit Elon Musk’s Tesla company with bringing EVs into mainstream thought with its spectacular high end Model S and Model X EVs, offering a degree of luxury and incredible performance only previously seen in high-end supercars. And now, Musk’s company is in the throes of bringing his production vehicles into the ‘affordable’ category – if $35,000 plus is seen as ‘affordable’. Pre-orders for the Tesla Model 3 are such that, provided it can meet its production targets, without going bust first, would make Tesla one of the world’s largest automakers.

Musk is a visionary and is not stopping there and has just shown the all-electric-powered truck (mentioned above), and the ‘Insane’ Tesla Roadster capable of 0-60 mph in 1.9 seconds and with a claimed 620 mile range, but many think Musk’s company is hugely overstretched and will crash and burn under its huge debt burden.

But it is probably Musk’s amazing vision and drive which has stimulated the EV sector into action. Whether Tesla will survive, or will be overtaken by mostly mainstream auto manufacturers, who now have been dragged into the realization that EVs are almost certainly the future, remains to be seen. The mainstream manufacturers are battling to cut into Tesla’s undoubted lead in the sector and are already coming out with possible Tesla killers – like the Chevy Bolt which offers similar pricing and performance to the Tesla Model 3 – but somehow lacks its kerb appeal.

Metals Demand

The global automobile market is enormous and a switch to EVs could have a huge impact. Below is a barchart from Visual Capitalist based on the change in metals demand with a 100% take-up of all-electric battery driven cars but only based on the battery technology used in the Chevy Bolt – GM’s (NYSE:GM) direct competitor with the Tesla Model 3, which uses a different battery make-up – and would be very different still once solid state batteries have come into use. However, it is valuable in demonstrating some of the likely beneficiary metals in a switch to EVs.

Naturally, lithium tops the bill, but here, there is plenty of future production coming on stream to meet demand so a lithium play may not be as beneficial as it would seem from the chart. It is perhaps some of the other metals where supply may not be able to keep up with demand and prices may rocket, but because these metals are often produced as byproducts, securing an investment that may take off accordingly may be more difficult to do.

Of the primary metals, the biggest beneficiaries could be copper, nickel, and aluminum – the former because the average EV uses around twice as much copper as existing ICE-driven vehicles, nickel, and aluminum are both used in some battery technologies in a big way, while the latter will almost certainly get increasing use in body panels to keep vehicle weights down. Of the byproduct metals cobalt has obviously the most potential as do the rare earths – specifically dysprosium which is utilized in some electric drive technologies.

London quoted Glencore [LSE: GLEN] is comfortably the world’s biggest cobalt producer, but cobalt only represents a small part of the company’s product mix, but nickel is important too. An ADR is available to U.S. Investors: Glencore ADR (OTCPK:GLNCY). Canada’s Sherritt International [TSX: S] which will also benefit as a major nickel producer could be of interest and again is available on the OTC market in the U.S. – Sherritt International (OTCPK:SHERF). Another major cobalt miner with a U.S. ADR quote is Brazil’s Vale (NYSE:VALE) but, like Glencore, is one of the world’s largest diversified miners, and cobalt represents a fairly small part of its overall revenues – but Vale is also the world’s second largest nickel producer after Russia’s Norilsk (OTCPK:NILSY).

Dysprosium is the rare earths wild card, but there is little or no significant production outside China, although Australia’s Northern Minerals [ASX: NTU] has brought is Browns Range mine into production and reckons to be the world’s next significant dysprosium producer outside China. But its mining operation, high in heavy rare earths of which dysprosium is particularly significant, is only at pilot plant construction stage at the moment.

Graphite, which may be the other major beneficiary ‘metal’, is primarily produced in China, India, Brazil, Turkey, and North Korea. Graphite investment options in North America are largely restricted to the risky junior sector, and none are full board quoted. There have been articles on Seeking Alpha about these, but for the moment, this writer is steering clear. The junior sector seems just too speculative. Rather look to the major stocks which may benefit as the downsides are much more limited.

Of the major metals, copper appears to be the likely major beneficiary of significant growth in the EV sector, while maintaining significant demand in the ICE-driven vehicle sector. The world’s biggest producer remains the Chilean state-owned Codelco, but the remaining big producers apart from the U.S. company, Freeport McMoran (NYSE:FCX) are mostly the big diversified miners. Glencore and Vale, both mentioned above as major nickel and cobalt miners, are among these as are BHP Billiton (BHP) and Rio Tinto (RIO), the world’s two biggest diversified miners. Both these are headquartered elsewhere – BHP’s joint HQ are in the UK and Australia, and Rio Tinto in the UK. Once again, because these are such big diversified mining companies, demand growth in a particular sector like copper may be less significant yet still give a useful boost to earnings.

The same applies to aluminum. Alcoa (NYSE:AA) is the biggest North American producer, but any impact due to growth in the automobile production sector won’t have a particularly significant impact overall as it will only represent a tiny portion of overall demand.

While this article primarily looks at the likely growth potential for EVs and some of the likely long term beneficiaries (virtually, none of the anticipated gains in the major sector are likely to eventuate until the next decade), one should also take a look at the eventual losers. The most notable is the market for platinum, palladium, and rhodium, all of which have their primary usage in ICE exhaust emission control catalytic technology. Here again, the problems are likely to appear long term – not short term where global recovery may still lead to some good gains – particularly if precious metals’ prices (driven by gold) rise. We would expect the platinum and palladium prices to rebalance in favor of platinum, given the change in the pricing differential is likely to result in a switch to platinum catalysts in at least a part of the gasoline ICE exhaust control market.

The current high palladium price of over $1,000 an ounce does not seem yet to have impacted stocks like Sibanye-Stillwater (SBGL). While the company is also expanding its platinum exposure through the just-announced purchase of Lonmin, it is not really being given the credit for its palladium exposure through Stillwater, and also in South Africa, where the majority of its production is based. Its holdings there are predominantly in mines producing primarily from the platinum richer Merensky reef, but it has the capability to add to its production on the UG2 reef which has a marginally higher palladium and rhodium content. But overall, both Stillwater and the South African producers are at best marginal operations at current pgm prices, although the higher palladium and rhodium prices may be slightly improving the economics.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Editor’s Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks.

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Top 10 Stocks To Watch For 2018

CBS (CBS) is up 34.5% in 2016, but JPMorgan thinks the stock can keep going strong next year.

Analyst Alexia Quadrani reiterated an Overweight rating and $69 price target on the stock Wednesday, writing that CBSs streamlined assets and savvy management means that it should easily pass $4 in EPS this year, a target that many questioned at the start of 2016.

Quadrani believes that CBS can continue to steam ahead next year, despite the lack of the Super Bowl and political ad spending, thanks to strong content sales, although a potential tie-up with Viacom (VIAB) may remain in the spotlight near term.

More detail from her note:

. 2017 will see a difficult comp from the absence of the Super Bowl and political ad dollars, which in our estimation account for ~$200m in operating income (possibly higher depending on the ultimate amount of election spending). The largest counterbalance to this will be retransmission and reverse comp revenue. Management has previously stated growth in 2017 should outpace 2016, given 21% of the retrans and 14% of the reverse comp footprint is up for renewal; we note that of the 21%, we expect roughly half of that early in the year with Fios, with the remainder toward the end of 2017 with Dish. Combined with guidance that total retrans/reverse in 2016 should surpass $1b, and the 39% growth YTD, we believe 2017 growth should be able to at least offset the operating income deficit from the Super Bowl and political.

Top 10 Stocks To Watch For 2018: Pershing Gold Corporation(PGLC)

Advisors’ Opinion:

  • [By Sara Cornell]

    Leading the way is CEO Edward Karr. As a founder of Pershing Gold Corp (NASDAQ:PGLC), he currently serves on their Board of Directors, and has been active in the natural resource industry for many years. With a background in finance and investment banking, Karr is credited with raising capital to begin operations at US Gold Corp, and establishing financing for both the operational and exploration sides of the company.

Top 10 Stocks To Watch For 2018: VALE S.A.(VALE)

Advisors’ Opinion:

  • [By Ben Levisohn]

    Mosaic (MOS) tumbled to the bottom of the S&P 500 today after announcing that it would buy Vale’s (VALE) fertilizer unit.

    Getty Images

    Mosaicdropped 1.1% to $27.77 today, while the S&P 500 advanced 0.2% to 2,262.53.

  • [By Craig Jones]

    On CNBC's Fast Money Halftime Report, Jon Najarian spoke about unusually high put options activity in Arconic Inc (NYSE: ARNC) and Vale SA (ADR) (NYSE: VALE).

Top 10 Stocks To Watch For 2018: Atlas Air Worldwide Holdings(AAWW)

Advisors’ Opinion:

  • [By Paul Ausick]

    Amazon leased 40 planes from Air Transport Services Group Inc. (NASDAQ: ATSG) and Atlas Air Worldwide Holdings Inc. (NASDAQ: AAWW). Each carrier is supplying 20 Boeing jets to Prime Air.

Top 10 Stocks To Watch For 2018: Exelon Corporation(EXC)

Advisors’ Opinion:

  • [By Horizon Investments]

    For the past year, Exelon Corp. (EXC) has had a roller coaster ride, with the stock having plummeted 15% since September 2012 – the company had announced a dividend cut of 41%, which led to a drop in the share price. Separately, the recent weak PJM auction prices did not bode well for the company. However, I believe the worst is priced in the stock price, and the company’s management is committed to improving its financial flexibility and cost structure in order to strengthen its financial performance. Also, the company is planning to incur capital expenditure (CAPEX) in the upcoming years, which will result in rate base growth for Exelon.

  • [By Casey Wilson]

    That brings us to General Electric Co. (NYSE: GE). The 125-year-old American mainstay signed a deal with Exelon Corp. (NYSE: EXC) last fall for the energy utility to use its own predictive analytics software, fittingly dubbed “Predix.”

  • [By Lisa Levin]

    Utilities shares climbed by 0.64 percent in trading on Friday. Meanwhile, top gainers in the sector included Exelon Corporation (NYSE: EXC), and FirstEnergy Corp. (NYSE: FE).

  • [By Monica Gerson]

    Analysts are expecting Exelon Corporation (NYSE: EXC) to have earned $0.68 per share on revenue of $7.52 billion in the latest quarter. Exelon shares rose 0.34 percent to close at $35.38 on Thursday.

Top 10 Stocks To Watch For 2018: American Financial Group, Inc.(AFG)

Advisors’ Opinion:

  • [By Lee Jackson]

    Aco-chief executive officer of American Financial Group Inc. (NYSE: AFG), Carl Linder, sold a total of 200,000 shares of the property and casualty insurance products provider at prices that ranged from $90.63 to $91.62. The total for the sale was set at $18 million. The shares closed Friday at $91.55, in a52-week range of $65.38 to $92.38. The consensus price target is $95.50.

Top 10 Stocks To Watch For 2018: Interpublic Group of Companies, Inc. (The)(IPG)

Advisors’ Opinion:

  • [By Laurie Kulikowski]

    The debt-to-equity ratio is somewhat low, currently at 0.94, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.96 is somewhat weak and could be cause for future problems.

     

  • [By Laurie Kulikowski]

    Net operating cash flow has significantly increased by 59.42% to $280.90 million when compared to the same quarter last year. In addition, INTERPUBLIC GROUP OF COS has also vastly surpassed the industry average cash flow growth rate of 8.14%.

     

  • [By Laurie Kulikowski]

    Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Media industry and the overall market, INTERPUBLIC GROUP OF COS’s return on equity significantly exceeds that of both the industry average and the S&P 500.

     

  • [By Paul Ausick]

    The Interpublic Group of Companies Inc. (NYSE: IPG) dropped about 4% Wednesday to post a new 52-week low of $21.28 after closing Tuesday at $22.16. The 52-week high is $25.71. Volume reached nearly 10 million shares traded, more than double the daily average of around 3.8 million. Tuesday’s weak earnings report continued to weigh on the share price.

  • [By Lisa Levin] Related TRST Earnings Scheduled For October 21, 2016 Major Accounting Changes Are Coming To The Financial Industry
    Related MORN One Of The World's Most Powerful Women, Fidelity Personal Investing President Kathleen Murphy, To Tell Her Story At The Benzinga Global Fintech Awards The 2017 Benzinga Global Fintech Awards Will Include An 'Unprecedented Group' Of Judges Morningstar Packs Conference Lineup For Financial Advisors (Investor’s Business Daily) Companies Reporting Before The Bell
    Rockwell Collins, Inc. (NYSE: COL) is estimated to report quarterly earnings at $1.31 per share on revenue of $1.33 billion.
    General Electric Company (NYSE: GE) is expected to report quarterly earnings at $0.17 per share on revenue of $26.46 billion.
    Honeywell International Inc. (NYSE: HON) is estimated to report quarterly earnings at $1.60 per share on revenue of $9.32 billion.
    Interpublic Group of Companies Inc (NYSE: IPG) is expected to report quarterly earnings at $0.03 per share on revenue of $1.76 billion.
    Schlumberger Limited. (NYSE: SLB) is estimated to report quarterly earnings at $0.26 per share on revenue of $7.02 billion.
    SunTrust Banks, Inc. (NYSE: STI) is expected to report quarterly earnings at $0.83 per share on revenue of $2.21 billion.
    ManpowerGroup Inc. (NYSE: MAN) is projected to report quarterly earnings at $1.11 per share on revenue of $4.68 billion.
    Kansas City Southern (NYSE: KSU) is estimated to report quarterly earnings at $1.15 per share on revenue of $593.82 million.
    Stanley Black & Decker, Inc. (NYSE: SWK) is projected to report quarterly earnings at $1.19 per share on revenue of $2.74 billion.
    WABCO Holdings Inc. (NYSE: WBC) is estimated to report quarterly earnings at $1.44 per share on revenue of $721.89 million.

Top 10 Stocks To Watch For 2018: Aurinia Pharmaceuticals Inc(AUPH)

Advisors’ Opinion:

  • [By Lisa Levin]

    Aurinia Pharmaceuticals Inc (NASDAQ: AUPH) shares shot up 24 percent to $4.60 after the company disclosed that Voclosporin met 48-week remission endpoints.

  • [By Todd Campbell]

    After positive mid-stage trial data suggested earlier this year that it might be able to reshape the treatment of kidney failure in lupus patients, Aurinia Pharmaceuticals (NASDAQ:AUPH)has announced plans for a late-stage study that could eventually allow it to win regulatory OKs in the U.S., Europe, and Japan.

  • [By Lisa Levin] Related NVCN 18 Biggest Mid-Day Losers For Wednesday Legal Overhangs Keep Ladenburg Neutral On Neovasc Despite Positive Tiara Clinical Data Boston Scientific closes Neovasc transaction (Seeking Alpha)
    Related BSX Watch These 10 Huge Call Purchases In Monday Trade Wonderful Wearables Get Their Own ETF Boston Scientific closes Neovasc transaction (Seeking Alpha) Gainers
    Neovasc Inc (US) (NASDAQ: NVCN) rose 17.3 percent to $2.65 in pre-market trading after the company reported the close of its $75 million transaction with Boston Scientific Corporation (NYSE: BSX).
    aTyr Pharma Inc (NASDAQ: LIFE) shares rose 12.3 percent to $4.10 in pre-market trading after the company disclosed 'promising' signals in myopathies with Resolaris in exploratory trials.
    Globus Maritime Ltd (NASDAQ: GLBS) shares rose 10.1 percent to $6.90 in pre-market trading after climbing 5.03 percent on Monday.
    Aurinia Pharmaceuticals Inc (NASDAQ: AUPH) shares rose 9.9 percent to $3.00 in pre-market trading. Aurinia Pharmaceuticals appointed Lorin Jeffry “Jeff” Randall to its board and Chairman of the Audit Committee.
    Ocean Rig UDW Inc. (NASDAQ: ORIG) shares rose 8.7 percent to $2.89 in pre-market trading after surging 19.82 percent on Monday.
    Full House Resorts, Inc. (NASDAQ: FLL) shares rose 5.1 percent to $2.08 in pre-market trading after declining 1.98 percent on Monday.
    Seadrill Ltd (NYSE: SDRL) rose 5.1 percent to $4.13 in pre-market trading after surging 3.15 percent on Monday.
    Noble Corporation (NYSE: NE) rose 5.1 percent to $7.60 in pre-market trading after declining 5.37 percent on Monday.
    Arbutus Biopharma Corp (NASDAQ: ABUS) rose 5.1 percent to $3.10 in pre-market trading. Arbutus issued additional data from its ARB-1467 Phase II

Top 10 Stocks To Watch For 2018: Intuit Inc.(INTU)

Advisors’ Opinion:

  • [By Lisa Levin]

    Benzinga's newsdesk monitors options activity to notice unusual patterns. These large volume (and often out of the money) trades were initially published intraday in Benzinga Professional . These trades were placed during Thursday’s regular session.

  • [By Chris Lange]

    The stock posting the largest daily percentage gain in the S&P 500 ahead of the close Wednesday was Intuit Inc. (NASDAQ: INTU) which jumped nearly 7% to $137.88. The stocks 52-week range is $101.81 to $140.25. Volume was 4.8 million on the day compared to the average of 1.9 million.

  • [By Asit Sharma]

    It’s tax season — the four months when tax and small-business software providerIntuit Inc.(NASDAQ:INTU) makes most of its profit for the year. On Thursday, Intuit filed its fiscal second-quarter 2017 earnings report and issued a progress report on its tax business so far this year.Tax volumes are well off last year’s pace: Let’s review the details, as well as management’s interpretation, after a look at the headline numbers.

  • [By Shauna O’Brien]

    Morgan Stanley reported on Wednesday that it has downgraded financial management solution provider Intuit Inc. (INTU).

    The firm has cut its rating on INTU to “Underweight,” and has given the company a $62 price target. This price target suggests a 6% decline from the stock’s current price of $66.30. This downgrade reflects the company’s slowing growth of its tax business.

    Intuit shares were mostly flat during pre-market trading Wednesday. The stock is up 11% YTD.

  • [By Monica Gerson]

    Intuit Inc. (NASDAQ: INTU) reported upbeat results for its third quarter and raised its FY16 guidance. Intuit shares dropped 2.15 percent to $105.00 in the after-hours trading session.

Top 10 Stocks To Watch For 2018: Teekay Offshore Partners L.P.(TOO)

Advisors’ Opinion:

  • [By Lisa Levin]

    Teekay Offshore Partners L.P. (NYSE: TOO) shares dropped 21 percent to $2.66. Morgan Stanley downgraded Teekay Offshore from Equal-Weight to Underweight.

  • [By Lisa Levin]

    In trading on Friday, energy shares fell 0.83 percent. Meanwhile, top losers in the sector included Teekay Offshore Partners L.P. (NYSE: TOO), down 10 percent, and Approach Resources Inc. (NASDAQ: AREX), down 8 percent.

  • [By Lisa Levin]

    Energy shares rose by 1.46 percent in the US market on Monday. Top gainers in the sector included Diamond Offshore Drilling Inc (NYSE: DO), CARBO Ceramics Inc. (NYSE: CRR), and Teekay Offshore Partners L.P. (NYSE: TOO).

  • [By Lisa Levin]

    In trading on Friday, energy shares fell 0.62 percent. Meanwhile, top losers in the sector included Teekay Offshore Partners L.P. (NYSE: TOO), down 9 percent, and Whiting Petroleum Corp (NYSE: WLL), down 7 percent.

Top 10 Stocks To Watch For 2018: 8point3 Energy Partners LP(CAFD)

Advisors’ Opinion:

  • [By Travis Hoium]

    Don’t look now, but the demise of the solar yieldco industry may have been overstated. In the past six months, NextEra Energy Partners (NYSE:NEP), NRG Yield (NYSE:NYLD), and Pattern Energy Group (NASDAQ:PEGI) have all outperformed the market, and even the maligned 8point3 Energy Partners (NASDAQ:CAFD) has come close.

  • [By Travis Hoium]

    Leading the charge are two yieldcos — NextEra Energy Partners (NYSE:NEP) and 8point3 Energy Partners (NASDAQ:CAFD) — and utility company AES Corporation (NYSE:AES). Here’s a look at why they’re good dividend stocks to own today.

  • [By Travis Hoium]

    Axiom Capital Management’s Gordon Johnson made a startling comparison this week, saying that yieldco 8point3 Energy Partners (NASDAQ:CAFD) looks a lot like the now bankrupt SunEdison and the recently bailed-out SolarCity. If he’s right and the yieldco is built on unstable ground, it could justify the stock’s drop over the last few months and be a warning for investors.

  • [By Shanthi Rexaline]

    Wells Fargo Securities downgraded shares of 8Point3 Energy Partners LP (NASDAQ: CAFD) and lowered its price target on Thursday, citing growth/strategic concerns given future sponsorship uncertainties.