EQUITIES ANALYSTS ISSUED AWAITATIONS FOR BORGWARNER INC.’S FY2018 REVENUE (NYSE:BWA)

BorgWarner Inc. (NYSE:BWA) – Equities researchers at Jefferies Financial Group issued their FY2018 earnings estimates for shares of BorgWarner in a research note issued to investors on Monday, December 3rd, Zacks Investment Research reports. Jefferies Financial Group analyst D. Kelley anticipates that the auto parts company will post earnings of $4.35 per share for the year. Jefferies Financial Group currently has a “Buy” rating and a $50.00 price objective on the stock. Jefferies Financial Group also issued estimates for BorgWarner’s Q4 2018 earnings at $1.07 EPS, FY2019 earnings at $4.61 EPS and FY2020 earnings at $4.96 EPS.

EQUITIES ANALYSTS ISSUE FORECASTS FOR HD SUPPLY STAKE INC’S FY2019 REVENUE (HDS)

HD Supply Holdings Inc (NASDAQ:HDS) – Equities research analysts at SunTrust Banks boosted their FY2019 EPS estimates for shares of HD Supply in a research report issued to clients and investors on Wednesday, December 5th, Zacks Investment Research reports. SunTrust Banks analyst K. Hughes now expects that the industrial products company will post earnings of $3.35 per share for the year, up from their prior estimate of $3.27. SunTrust Banks also issued estimates for HD Supply’s Q4 2019 earnings at $0.65 EPS, Q1 2020 earnings at $0.85 EPS, Q2 2020 earnings at $1.10 EPS, Q4 2020 earnings at $0.55 EPS and FY2020 earnings at $3.36 EPS.

Are Equities Pointing To Global Recession?

Summary

  • The equity market is a leading indicator of slowdown or recession, and US equities have declined sharply in the past 3 months.
  • The PMI index for US, Europe and China points to a slowdown in the global economy, and global growth is likely to be muted in 2019.
  • While the probability of recession is still not significant, equities can continue to decline with the dollar gaining in strength on tight monetary policies.
  • It is advisable to increase exposure to gold and cash for the coming months, as risk-off trade is dominant in increasing global risk.

Equity Market Overview

The S&P 500 index touched 2018 highs of 2,944 on September 21, 2018. Subsequently, the index is down by 16.1% to current levels of 2,470. The sharp decline in equity markets in the United States has been associated with fundamental factors, and this article will discuss some of the critical factors that have translated into market correction.

Before talking about the fundamental factors, it is important to note that the S&P 500 index bottomed out at 683 on March 6, 2009. However, the US economy emerged from recession only in the third quarter of 2009. The point I am trying to make here is that the markets serve as leading indicators of potential recovery or recession.

With a significant market decline in the past 3 months, this article will discuss some of the key fundamental factors that have impacted equities. Further, the article will discuss the probability of US and global recession in the coming quarters.

The Dollar and Equities

Before talking specifically about the indicators of US and global economic activity, I would briefly like to discuss the dollar movement in the recent past.

The dollar index is currently at 96.4, and this is the highest level in the past 12 months. I wanted to mention this point as US equity movement is a function of dollar strength as well. Just to put things into perspective, when the dollar is strong, it is a symptom of tightening global liquidity. In such a scenario, equities trend lower. On the other hand, when the dollar is weak, it is a symptom of easing global liquidity, and in such a scenario, equities trend higher.

Top Trade Idea for 2019: Long Pound, Short US Equities, Long Gold

Often, I am asked where a currency or market will be at a specific date into the future. My response will almost always start with “I don’t know.” Everything in trading is a probability. There are no certainties, and to assume where a market will be and at a specific time is to whittle down the probabilities of success to almost ensure your assumptions will be disproven. That said, there are certain events with such significant weight that markets will inevitably change as they unfold or after they pass. Brexit is one of those events. Considering how volatile the discussions have been through 2018, it is reasonable to anticipate further switchbacks in these negotiations through the opening months of 2019. I have little interest in attempting to trade anything more than very short-term opportunities in the Sterling as they arise through that uncertainty. However, when there is a clear resolution, the lifting of uncertainty will allow for a trend – though that could be ambiguous to direction. A no deal will likely see the Sterling drop further, but once early trade deals are struck with key counterparts, the currency will start to recover from a further depressed level. If there is a compromise – and this is true of most scenarios in this middle ground – the Pound will start to rise over the subsequent months as it is implemented. If there is a second referendum, some degree of uncertainty will remain until the vote is tallied. Revoking the initial Brexit will lead to a Sterling rally while reaffirming the initial decision would push back the time frame for the eventual recovery – the only scenario I wouldn’t expect a more systemic Pound recovery. There are no explicit times or levels in this, but that is the nature of trading – the less obvious the key levels and timetable, the more significant the ultimate move. For pairings, my preference runs less towards those explicitly risk oriented and more dependent on liquidity: GBPUSD and EURGBP.

Imperial Capital Equities Analysts Boost Earnings Estimates for Discovery Communications Inc. (DISCA)

Discovery Communications Inc. (NASDAQ:DISCA) – Imperial Capital raised their FY2019 earnings per share estimates for shares of Discovery Communications in a note issued to investors on Tuesday, December 4th, according to Zacks Investment Research. Imperial Capital analyst D. Miller now forecasts that the company will earn $2.69 per share for the year, up from their previous estimate of $2.59. Imperial Capital has a “Inline” rating and a $31.00 price target on the stock. Imperial Capital also issued estimates for Discovery Communications’ Q1 2020 earnings at $0.71 EPS, Q3 2020 earnings at $0.82 EPS and FY2020 earnings at $3.38 EPS.

Equities Analysts Set Expectations for Schlumberger Limited.’s Q1 2019 Earnings (NYSE:SLB)

Schlumberger Limited. (NYSE:SLB) – Equities researchers at Capital One Financial cut their Q1 2019 earnings per share (EPS) estimates for Schlumberger in a report issued on Wednesday, December 5th, according to Zacks Investment Research. Capital One Financial analyst L. Lemoine now forecasts that the oil and gas company will post earnings per share of $0.33 for the quarter, down from their previous forecast of $0.39. Capital One Financial also issued estimates for Schlumberger’s Q2 2019 earnings at $0.45 EPS, Q3 2019 earnings at $0.58 EPS and FY2019 earnings at $2.05 EPS.

Equities Analysts Issue Forecasts for NCI Building Systems Inc’s Q1 2019 Earnings (NCS)

NCI Building Systems Inc (NYSE:NCS) – Investment analysts at DA Davidson upped their Q1 2019 earnings per share (EPS) estimates for shares of NCI Building Systems in a report issued on Thursday, December 20th. DA Davidson analyst B. Thielman now expects that the construction company will post earnings of $0.17 per share for the quarter, up from their prior estimate of $0.14. DA Davidson currently has a “Neutral” rating and a $7.50 target price on the stock. DA Davidson also issued estimates for NCI Building Systems’ Q3 2019 earnings at $0.47 EPS and FY2020 earnings at $1.51 EPS.

Alexandria Real Estate Equities, Inc. (ARE) Investors Focused Stock

Alexandria Real Estate Equities, Inc. (ARE) At the moment, stock is trading at $117.42 and moved -2.10%. Meanwhile, the stock investors and analysts deem this stock on the go as it shuffled with 0.91 million shares contrasting its Average Volume of 0.68 million shares. The trading company has the Market Cap of $12677.84. ARE stock about -11.08% away from the 52-week high and closed 3.00% away from the 52-week low. The total dollar value of all 107.97 million outstanding shares is 12.68 billion. Price earnings ratio (P/E) ratio of Alexandria Real Estate Equities, Inc. (ARE) is 28.30. ARE has price to earnings growth (PEG) ratio of 283.01 and Forward P/E of 51.16.

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