Archive for 2014
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Cognizant Technology Upgrade By UBS
Eddy Elfenbein, April 2nd, 2014 at 12:48 pmShares of Cognizant Technology Solutions ($CTSH) have recovered after a recent dip. Steven Milunovich at UBS Securities just upped CTSH to a buy and raised his price target to $58 per share.
Milunovich expects EPS ex items this year of $2.55 to $2.57, vs. $2.02 last year. The consensus estimate of analysts polled by Thomson Reuters is $2.35.
Milunovich also expects revenue to rise 17.5% to 18.5%, where analysts expect 16.5%.
“We like Cognizant because it is well positioned for the current demand environment. Cognizant is well positioned for the current IT environment in that IT budgets are under pressure with a focus on cost optimization,” Milunovich wrote.
The company’s technology and expansion into Europe “could double its available market, helping maintain upper-teen revenue growth,” he said.
The stock was below $48 a week ago, and it broke above $53 this morning.
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Taming Momentum Crashes
Eddy Elfenbein, April 2nd, 2014 at 12:40 pmThis looks interesting. Some academics applied 10% stops to a momentum-based strategy and found that it boosted overall performance. This makes sense since it harnesses the natural trend effects of financial markets.
Taming Momentum Crashes: A Simple Stop-Loss Strategy
Yufeng Han
University of Colorado at Denver – Business SchoolGuofu Zhou
Washington University in St. Louis – Olin School of BusinessMarch 10, 2014
Abstract:
In this paper, we propose a simple stop-loss strategy to limit the downside risk of the well-known momentum strategy. At a stop-level of 10%, we find empirically with data from January 1926 to December 2011 that the monthly losses of the equal-weighted momentum strategy can go down substantially from -49.79% to within -11.34%. For the value-weighted momentum strategy, the losses reduce from -65.34% to within -23.69% (to within -14.85% if year 1932 is excluded). At the same time, the average returns and the Sharpe ratios with use of the stops are more than doubled. Our results indicate that the abnormal profitability of the momentum strategy is unlikely explained by crash risk. -
Morning News: April 2, 2014
Eddy Elfenbein, April 2nd, 2014 at 7:26 amBRICs Casualty Seen in ETFs New Confidence Without China
RBI to Give New Bank Licenses Within the Next 10-15 Days After Election Commission’s Nod
Greece to Issue First Long-term Bond Since Bailout
Clearstream Banking and Iran Central Bank Probed by U.S.
Sen. Paul: Give Caterpillar Award for Tax Strategy
Apple and Samsung Reprise Patent Fight (With Google a Shadow Presence)
What Intel’s Big Data Bet Means for Cloudera
Goldman to Sell Designated Market-maker Unit to IMC
Lufthansa Pilot Strike Halts Jets in Airline’s Worst Walkout
Prada Posts Less Than 1% Gain in 2013 Profit, Missing Estimates
One Buck Zuck and Other $1-Per-Year CEOs
Sheryl Sandberg Sells half Her Stake in Facebook
Did Someone Front Run Michael Lewis?
Jeff Carter: Does It Affect You? If You Believe in Free Market Capitalism It Does
Roger Nusbaum: People Make Their Finances More Complicated Than They Need To Be
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March ISM Rises to 53.7
Eddy Elfenbein, April 1st, 2014 at 2:42 pmThis morning’s ISM report increased from 53.2 in February to 53.7 for March. It was below the Street’s expectations of 54.0 but I think it’s important that it was a monthly increase.
The monthly ISM is a good coincident indicator of the economy. In January, the ISM took a surprise dip, which was probably due to the weather. It looks like we’ve shaken that off.
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Paddy Hirsch Explains HFT
Eddy Elfenbein, April 1st, 2014 at 2:02 pm -
The S&P 500 Total Return Index
Eddy Elfenbein, April 1st, 2014 at 10:58 amHere’s a look at the S&P 500 Total Return Index since 1988. From the March 2009 low, the index has returned 208%.
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S&P 500 Hits All-Time High
Eddy Elfenbein, April 1st, 2014 at 10:45 amThe S&P 500 broke out to an all-time intra-day high today. The index has been as high as 1,884.60 this morning. The previous high was on March 21 at 1,883.97.
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Ford’s Sales Rise in March
Eddy Elfenbein, April 1st, 2014 at 9:58 amAlthough the economy was hurt by some severe weather this spring, Ford seems to be bouncing back. The automaker reported that March sales rose by 3.3%.
Ford deliveries rose 3.3 percent to 243,417 cars and light trucks. Ford’s F-Series pickups gained 5.1 percent to 70,940, while Fusion sales rose 8.8 percent to 32,963, the Dearborn, Michigan-based automaker said in a statement. The second-largest U.S. automaker topped the average of nine analysts who projected a gain of 1.1 percent.
The stock broke above $16 per share this monring.
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Morning News: April 1, 2014
Eddy Elfenbein, April 1st, 2014 at 6:33 amDraghi Europe Scenario Points to Lowflation Still Painful
Europe Goes From M&A Laggard to Leader as Crisis Mode Subsides
UK Manufacturing Growth Cools in March – PMI
Japan Ends Half-Century Ban on Weapons Exports
India to Widen Scope for Currency Hedging by Foreign Investors
One More Time, Watch What Yellen Says
Congress Passes Bill Averting Medicare Pay Cut For Doctors
Fault Runs Deep in Ultrafast Trading
GM’sj Barra Apologizes to Families in Testimony
GM’s Recall Woes Worsen as CEO Prepares for House Hearing
Caterpillar Set to Defend Its Tax Bill
BlackBerry v. Typo: Why Worry Over The ‘Dead’ Keyboard?
FCC Tightens Rule on TV Ad Sale Alliances
Cullen Roche: Thoughts on Thomas Piketty’s “Capital”
John Hempton: Charlotte: An Old Meeting With Bank of America
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The First Quarter Is On the Books
Eddy Elfenbein, March 31st, 2014 at 4:22 pmThe S&P 500 rose 1.30% for the first three months of 2014, and our Buy List gained 2.08%. Adjusted for dividends, the S&P 500 is up 1.81% for the quarter. Including dividends, our Buy List is up 2.42% for the year.
Eddy Elfenbein is a Washington, DC-based speaker, portfolio manager and editor of the blog Crossing Wall Street. His