Will Facebook Finally Break Through $200?

Posted on by Noah Kiedrowski

Noah Kiedrowski - INO.com Contributor - Biotech


Introduction

Facebook Inc. (NASDAQ:FB) is on tap to report Q4 FY2017 earnings along with its full-year FY2017 numbers. Facebook recently breached the $189 level as earnings approached, however it recently sold off from these highs following news that Facebook would overhaul its news feed in favor of “meaningful social interactions” versus “relevant content.” I think this news was timely with the upcoming earnings announcement as Facebook will once again deliver phenomenal growth numbers across the business with beats on both top and bottom lines. Once the growth trajectory is affirmed with EPS moving in lock-step, the stock only becomes cheaper, and thus this pull-back could be a rare buying opportunity before the stock breaking through the $200 barrier. Facebook ended 2017 with a monster return of 53%, however, considering its growth the stock remains relatively cheap with a P/E of 34.8 and PEG of 1.23 implying an annual EPS growth rate of 28.3%. Once the newly designed news feed launches in conjunction with earnings later this month, I think the stock could break through the $200 level imminently. I feel that Facebook represents value even after this massive run through 2017 and I maintain my long thesis with a price target of $230 by the end of 2018.

News Feed Overhaul

Facebook announced major changes are coming to its news feed to prioritize “meaningful social interactions” on the social media’s news feed as opposed “relevant content.” With this reformatting, users will start seeing less public content from businesses or publishers and more posts from their friends. Mark Zuckerburg expects that the time people spend on the social media network will decrease as a result however it will be “more valuable.” Facebook sold-off on the news as investors and analysts regarded this as an overall negative impact on earnings. Facebook sold-off over 5% on the news or $10 per share as analysts weighed in on the new roll-out. Overwhelmingly, analysts remain positive on shares of Facebook with JP Morgan’s Doug Anmuth maintaining his overweight rating and a $230 target price. I feel that the news feed overhaul will be negligible to earnings, especially over the long term. This sell-off is an excellent opportunity to enter the stock before what will likely be a fantastic earnings announcement. Continue reading "Will Facebook Finally Break Through $200?" →

Farewell Janet, Welcome Jay

Posted on by George Yacik

George Yacik - INO.com Contributor - Fed & Interest Rates


After four years as Federal Reserve chair, Janet Yellen makes her swansong at this week’s monetary policy meeting (no disrespect to Ms. Yellen, but it seems like a lot longer, doesn’t it?), at which time she will likely welcome her successor, Jerome Powell, who was finally confirmed by the Senate. Her term officially ends on February 3, at which time she has said she would also step down from the Fed’s Board of Governors, where she was entitled to remain for another six years.

While most observers believe Powell won’t deviate too far from the dovish, don’t-rock-the-boat policies of his predecessor, I think he’s likely to be a little more hawkish in raising interest rates, if for no other reason than to skim some of the froth from the stock market. Another quarter-point increase in the federal funds rate at next week’s meeting would be a good signal about what to expect from the Powell Fed going forward.

I’m still not entirely sold that inflation won’t at some point in the future rear its ugly head once again, mandating a more aggressive interest rate-raising policy, but the bond market – based on still relatively low long-term Treasury bond rates – apparently has yet to be convinced. Still, inflation, whether just boiling under the surface or several years down the road, isn’t the only reason the Fed needs to be more hawkish. Taking some air out of asset bubbles – whether they be in old-fashioned equities or yet-to-be-tested cybercurrencies – that has primarily been the result of the Fed’s overly accommodative monetary policies is a good enough reason to do so. Continue reading "Farewell Janet, Welcome Jay" →

Weekly Futures Recap With Mike Seery

Posted on by The INO.com Team

We've asked Michael Seery of SEERYFUTURES.COM to give our INO readers a weekly recap of the Futures market. He has been Senior Analyst for close to 15 years and has extensive knowledge of all of the commodity and option markets.

Michael frequently appears on multiple business networks including Bloomberg news, Fox Business, CNBC Worldwide, CNN Business, and Bloomberg TV. He is also a guest on First Business, which is a national and internationally syndicated business show.

Silver Futures

Silver futures in the March contract settled last Friday in New York at 17.03 an ounce while currently trading at 17.35 up about $0.30 for the trading week and traded as high as 17.70 in yesterday's trade before selling off. Profit-taking was to blame as that was a four-month high. I have been recommending a bullish position from around the 17.50 level and if you took that trade continue to place the stop loss under the two-week low standing at 16.73 as the chart structure will not improve for another seven trading days. You're going to have to accept the monetary risk as the volatility certainly has come back, which is a terrific thing to see in my opinion. The U.S. dollar has hit a three year low this week continuing its bearing trend which is helping support the precious metals as gold prices were also higher this week. Continue to play this to the upside, and if you did not take the original trade, I'm still recommending it at today's price level as the risk is about $750 per mini contract plus slippage & commission. Silver prices are trading above their 20 and 100-day moving average as the trend as positive as I am bullish all commodity sectors including the stock market as my only bearish recommendation is in the bond market as 2018 could see terrific trends to the upside.
TREND: HIGHER
CHART STRUCTURE: EXCELLENT
VOLATILITY: INCREASING
Continue reading "Weekly Futures Recap With Mike Seery" →

Stocks Rise On Strong Earnings

Posted on by The INO.com Team

Hello traders everywhere. Both the DOW and the S&P 500 have hit new intra-day highs and are looking to close out the week at record highs. This latest move higher has been driven by a weaker U.S. Dollar and a strong earnings season so far.

This week has seen some overall market volatility, but a strong finish today will put the three main indexes on track for their best four-week rally since 2016.

Stocks Rise Strong Earnings

The latest saga in the Bitcoin/cryptocurrency space continues to be a lack of regulation. One of Japan's largest cryptocurrency exchanges, Coincheck, said that about $400 million in NEM tokens were lost after the coins were sent "illicitly" outside the venue, spooking investors in a country that's still wary of digital-token exchanges four years after the collapse of Mt. Gox.

Cryptocurrency exchanges, many of which operate with little to no regulation, have suffered a series of outages and hacks amid the trading boom that propelled Bitcoin and its peers to record highs last year. What lasting effect will these continued hacks and outages have on the cryptocurrency space moving forward?

Key levels to watch next week: Continue reading "Stocks Rise On Strong Earnings" →

Global Oil Stocks to Build in 2018

Posted on by Robert Boslego

Robert Boslego - INO.com Contributor - Energies


OPEC released its Monthly Oil Market Report (MOMR) for January, and its projections for 2018 imply a 29 million barrel global stock build, in contrast to 140 million barrel draw it estimated for 2017. As a result, it will not clear the glut, which OPEC estimates to be at 133 million barrels, at the end of November, based on the “latest five-year average.”

In 2017, OPEC production averaged about 32.5 million barrels per day (mbd), adjusting for the change in OPEC membership (i.e., with Indonesia’s 740,000 b/d).

global oil inventory 2017

In 2018, I have assumed OPEC production averages 33.2 mmbd, which is OPEC’s forecast (December) of its 2018 production. However, OPEC production averaged 32.416 mmbd in December.

global oil inventory 2018

OPEC projections imply that global stocks will build much more quickly in the first half of 2018 than they did during the same period in 2017. And the stock draws in the second half of 2018 are expected to be smaller than they were in 2017. Continue reading "Global Oil Stocks to Build in 2018" →