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>>> GE raises $1.5 billion as pressure mounts to fix balance sheet
By Matt Egan
CNN Business
November 16, 2018
https://www.cnn.com/2018/11/16/business/ge-capital-debt/index.html
GE changed our lives. Why is it struggling?
New York (CNN Business)General Electric boss Larry Culp is making good on his promise to swiftly unload assets to pay down the company's mountain of debt.
In the second major deal this week, GE (GE) said on Friday it's raising $1.5 billion by selling a GE Capital portfolio of healthcare equipment leases and loans to TIAA Bank.
The transaction, combined with a plan announced on Tuesday to sell a $4 billion stake in oil-and-gas giant Baker Hughes (BHGE), underscores GE's scramble to raise cash that can be used to repair the balance sheet. Last month Culp also slashed GE's cherished dividend to a penny.
Years of poorly-timed deals and shrinking cash flow have sparked a cash crunch at GE, which makes everything from light bulbs and jet engines to MRI machines and wind turbines. GE's stock price has been cut in half this year, on track for its worst performance since 2008.
Culp, who became CEO on October 1, vowed to move with a "sense of urgency" to repair GE's finances. "This is the challenge of a lifetime given where we find the company today," Culp told CNBC.
Prior to 2008, GE Capital was a major growth engine at the company. It provided affordable financing that allowed customers go out and purchase GE's industrial products. But GE Capital came under enormous pressure during the financial crisis, nearly taking down the entire company. And its problems are still haunting GE.
GE Capital's long-term care insurance business took a $6 billion charge earlier this year. And the company faces a potentially-costly settlement with the Justice Department over WMC, the subprime mortgage lender acquired in 2004.
Jeff Immelt, the widely-criticized former CEO of GE, said on Thursday he wishes he'd been able to get rid of GE Capital more quickly. "Believe me, it wasn't for a lack of trying," Immelt said from the World Business Forum in New York. "It was just hard to do."
GE Capital provides financing used by hospitals to purchase CT scan and other equipment made by the health care division.
Now under Culp, GE Capital is unloading this $1.5 billion healthcare portfolio of loans and leases that financed purchases of medical equipment by 1,100 hospitals and 3,600 physician practices and medical centers across the United States. The equipment includes everything from ultrasound and respiratory machines to surgical and lab materials.
As part of the deal, GE and TIAA Bank entered into a five-year vendor financing agreement for GE Healthcare's US customers. GE said that the leadership and sales force of the healthcare equipment finance team will integrated into GE Healthcare in 2019. GE plans to spin off the profitable health care division in a bid to raise more cash.
Jacksonville, Florida, based TIAA Bank is part of TIAA, the retirement giant that was founded by steel magnate Andrew Carnegie in 1918. Today, TIAA manages around $1 trillion of assets.
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>>> The dismantling of GE continues: It is selling yet another business
By Matt Egan
CNN Business
November 6, 2018
https://www.cnn.com/2018/11/06/business/general-electric-current-sale-lighting/index.html
New York (CNN Business)General Electric's slow-motion breakup with the lighting industry it pioneered continues.
GE announced on Tuesday it's selling commercial LED maker Current to private-equity firm American Industrial Partners.
It's the latest business that GE is saying goodbye to as it races to pay down debt by raising cash and cutting costs. GE's (GE) debt-riddled balance sheet forced the company to slash its dividend to just a penny last week.
GE did not disclose a sale price for Current. Analysts said that suggests the unit, which was put up for sale a year ago, fetched an insignificant sum. The deal marks an unceremonious ending for a business that GE launched just three years ago as a next-generation energy efficiency solution for companies.
LED pricing has come under heavy pressure and Current generated just $900 million of sales during the first nine months of 2018. In addition to LED technology, Current makes sensors, controls and software for customers that include Walmart (WMT) and JPMorgan Chase (JPM). As part of the proposed sale, Current will keep using the iconic GE brand under a licensing agreement.
Current's new home will be American Industrial Partners, a New York-based private equity firm focused on improving industrial companies.
"The firm's deep expertise in operations and engineering, combined with its highly successful track record of industrial business investments, would help us accelerate Current's growth," Current CEO Maryrose Sylvester said in a statement.
GE is still trying to find a buyer for its famous consumer light bulb business, which was not included in the Current sale. GE first announced plans to sell the lighting unit in mid-2017.
"GE remains actively engaged in the process to sell this business," the company said in a statement.
GE's financial problems -- debt is too high and earnings are shrinking -- have forced the conglomerate to dismantle itself in a bid to raise $20 billion.
In recent months, GE has agreed to sell its century-old locomotive division and announced plans to spin off GE Healthcare, which makes MRI machines. GE also reiterated plans last week to eventually exit its majority stake in the oil-and-gas giant Baker Hughes.
And on Tuesday, GE finalized the $3.25 billion sale of its distributed power business to private equity firm Advent International. The sale of the unit, which makes gas engines that are used to generate electricity in remote places, was first announced in June.
The flurry of dealmaking is a sign that new CEO Larry Culp is working hard to repair GE's balance sheet.
Wall Street has grown frustrated with the speed of GE's turnaround, which began under former CEO John Flannery. The stock, trading near nine-year lows, has declined nine straight days. GE has lost 45% of its value this year. That's the third-worst performance in the entire S&P 500 and mirrors GE's 2017 loss.
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>>> GE slashes 119-year old dividend to a penny
By Matt Egan
CNN Business
October 30, 2018
https://www.cnn.com/2018/10/30/investing/ge-dividend-cut-earnings-culp/index.html
New York (CNN Business)General Electric is under such financial stress that new CEO Larry Culp is slashing the troubled conglomerate's 119-year-old dividend to just a penny a share.
GE revealed on Tuesday worse-than-expected results and a $22 billion accounting writedown for its beleaguered power division. Culp plans to split up the power division to accelerate a turnaround.
In a bid to fix GE's debt-riddled balance sheet, Culp announced the company will cut its quarterly dividend from 12 cents a share starting in 2019. By paying just a token dividend, GE (GE) will save about $3.9 billion of cash per year.
Analysts had been anticipating a potential dividend cut, though not one of this magnitude.
It's an especially painful move for a company that long viewed its stable dividend as a source of pride. But years of bad decisions forced GE to halve its dividend last November for just the second time since the Great Depression. The dividend cuts deal a blow to the many GE retirees and mom-and-pop shareholders who long relied on the cherished payouts.
"We are on the right path to create a more focused portfolio and strengthen our balance sheet," Culp said in a statement.
Culp, who was suddenly named CEO on October 1, promised to move "with speed to improve our financial position."
Dividend cuts are very rare these days, because the US economy is booming. Most companies, flush with cash from tax cuts, are ramping up their dividends. At least 291 S&P 500 companies have hiked their dividend so far this year, according to Howard Silverblatt of S&P Dow Jones Indices. Just two S&P 500 companies had cut their dividend as of early October, Silverblatt said.
GE's power division remains the biggest source of trouble at the company. Revenue tumbled 33% last quarter due to "continued market and execution challenges." GE Power swung to a loss of $631 million, compared with a profit of $464 million the year before.
GE Power, which makes turbines for power plants, has been caught badly off guard by the shift away from coal and gas in favor of renewable energy. Under former CEO Jeff Immelt, GE doubled down on fossil fuels by spending $9.5 billion in 2015 to acquire Alstom's power business. The deal turned out to be a disaster, underscored by the $22 billion goodwill impairment charge recorded last quarter.
GE said on Tuesday it will reorganize the power business by creating two units, one focused on natural gas and the other holding the steam, nuclear and other assets. And Culp, who was known for running a tight ship at Danaher, plans to "consolidate" GE Power's headquarters structure.
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>>> Medicare Part B premiums devouring many retirees' Social Security increase, survey shows
•A quarter of older Americans say that after their Medicare Part B premium is deducted from their Social Security check, they're left with no more than they had last year.
•Another 18 percent say they've seen a boost of less than $5 a month.
•This is coming after several years of many Social Security recipients paying less than the standard premium amount due to being protected by the so-called "hold harmless" provision.
Sarah O'Brien
29 May 2018
https://www.cnbc.com/2018/05/24/medicare-part-b-premiums-devour-social-security-increase-survey-shows.html?__source=msn%7Cmoney%7Cinline%7Cstory%7C&par=msn&doc=105297754
For many of the 47 million older Americans on Social Security, getting a 2 percent cost-of-living increase in their 2018 benefits has been a bust.
More than 40 percent of the over-65 crowd say they have watched the extra amount get completely or mostly eaten up by the cost of Medicare Part B premiums, according to a recent survey by the Senior Citizens League.
Specifically, 25 percent say that after the deduction for the premium, their check is unchanged. Another 18 percent say the increase has been less than $5.
Older Americans report little boost in 2018 Social Security checks
Amount in 2018 is...
Lower than in 2017 7%
Same as in 2017 25%
Up to $5.00 higher 18%
$5.01 to $10.00 higher 23%
$10.01 to $25 higher 20%
More than $25 higher 7%
"They've had nothing left over to deal with other increased costs," said Mary Johnson, Social Security and Medicare policy analyst for the Senior Citizens League, which surveyed 1,116 retirees across the country earlier this year.
The reason for the premiums devouring all or much of the extra Social Security amount is due largely to the so-called hold harmless rule that's been triggered in recent years.
For most retirees — about 70 percent of them — the rule prevents Medicare Part B premiums from rising more than their Social Security cost-of-living adjustment, commonly called COLA.
Higher earners, who pay extra for their premiums, are not protected by the hold harmless rule. (See chart for what higher earners pay.) Nor are certain others, including those who first sign up for Medicare right before an increase takes effect.
Medicare Part B premiums
What you pay monthly in 2018
$85,000 or less $170,000 or less $85,000 or less $134
Above $85,000 up to $107,000 Above $170,000 up to $214,000 Not applicable $187.50
Above $107,000 up to $133,500 Above $214,000 up to $267,000 Not applicable $267.90
Above $133,500 up to $160,000 Above $267,000 up to $320,000 Not applicable $348.30
Above $160,000 Above $320,000 Above $85,000 $428.60
For people affected by the provision, the rule means they won't see their Social Security check get lowered in any given year if paying more for Part B would reduce it. (The premiums are typically deducted from Social Security checks.)
When the premium jumped to $134 in 2017 from $121.80 the previous year, 70 percent of Medicare Part B enrollees instead paid an average of $109 due to already being held harmless in previous years with meager COLA increases.
And although the Part B premium hasn't changed from last year's $134, the extra money generated from the 2 percent Social Security COLA for 2018 is going toward the difference between what most recipients were paying and the standard premium amount.
Even for those whose checks are more than last year, just 7 percent said the boost is more than $25.
"Social Security increases, even when they come, are not huge and don't really make any meaningful difference in quality of life," said Kathryn Hauer, a certified financial planner with Wilson David Investment Advisors.
The survey also showed that 7 percent of respondents said their check is lower. Johnson, of the Senior Citizens League, said those people have uncommon circumstances that led to a lower check, none of which are related to the hold harmless provision.
Exactly whether retirees will be shelling out more from their Social Security checks next year for Part B depends both on whether those premiums rise and what the Social Security Administration determines the 2019 COLA will be.
Last July the Medicare trustees report forecast that 2019 Part B monthly premiums will remain at about $134. After that, they are expected to rise about 5 percent each year through 2026. The Centers for Medicare and Medicaid typically announces the next year's premium amount in November.
The 2019 Social Security COLA, meanwhile, is scheduled to be announced in October.
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>>> What you don't know about Medicare can cost you, big time
CNBC
by Darla Mercado
6-30-18
https://www.msn.com/en-us/money/personalfinance/what-you-dont-know-about-medicare-can-cost-you-big-time/ar-AAzfEiT?OCID=ansmsnnews11
Though Medicare is an essential part of retirement, pre-retirees continue to have misconceptions on how the federal program works.
Close to 90 percent of older Americans either enrolled in Medicare or plan to sign up for coverage, according to a recent survey from Nationwide Retirement Institute.
The insurer’s research arm worked with The Harris Poll to survey 1,007 adults over age 50 with a household income of at least $150,000.
More than 7 out of 10 participants said that they wish they better understood Medicare coverage.
“Health care costs are the biggest expense in retirement and should be a major factor when estimating retirement expenses, since they are often costly and unexpected,” said John Carter, president of retirement plans for Nationwide.
“It’s an opportunity for financial advisors to educate their clients and for consumers to ask questions,” he said.
Here are three major facts that even affluent pre-retirees are getting wrong about Medicare.
“Coverage for outpatient care is free.”
More than half of the individuals in the poll did not know that Medicare Part B — which covers doctor’s services and outpatient care — is not free.
Nearly 3 in 10 of the participants believed Medicare costs the same for everyone.
It’s not true.
The standard Part B premium amount is $134 per month in 2018 for singles with a modified adjusted gross income (MAGI) of $85,000 or less in 2016 ($170,000 for married joint filers).
High-income beneficiaries can expect to shell out more for this coverage. See below.
Participants in Medicare’s program for prescription drugs, or Part D, can expect to pay more if their 2016 MAGI exceeded $85,000 ($170,000 if married).
Part A, hospital insurance, is free if you and your spouse paid Medicare taxes while you were working.
There is also Medigap, which supplements Part A and B, helping you handle the cost of deductibles and copays, as well as offering you coverage you may not otherwise receive through your plans.
“You can enroll at any time.”
a group of people looking at a laptop© Provided by CNBC
More than 20 percent of the participants erroneously believed you could sign up for Medicare whenever you want.
The reality is that you have a seven-month initial enrollment period once you first become eligible for Medicare to sign up for the program. That seven-month period kicks off three months before the month in which you turn 65 and ends three months after your 65th birthday.
Medicare also offers another opportunity to sign up during a “general enrollment period” from Jan. 1 to March 31.
Special enrollment periods are available for those who have coverage under a workplace plan and who may not need to apply for Medicare at age 65.
Keep an eye on your calendar: Failure to sign up for Medicare Part B when you’re first eligible and no qualifying exceptions may result in a penalty. Your premium may go up 10 percent for each year that you could’ve had coverage but failed to sign up for it.
You’ll be paying this higher premium as long as you are enrolled in the program.
“You can’t switch plans.”
A sample medicare benefit card and prescription drugs card.© Provided by CNBC A sample medicare benefit card and prescription drugs card.
More than a third of participants believed that once you’ve signed up for Medicare, you’re stuck with the plan you’ve selected.
That’s not true.
Medicare open enrollment — which runs from Oct. 15 to Dec. 7 — gives beneficiaries a chance to swap from Medicare Parts A and B to an Advantage Plan (known as Medicare Part C), or to shift from an Advantage Plan to Parts A and B.
You can also change your existing Advantage Plan or change your Part D plan.
Even if you’re happy with your plan, you should review it every year and shop around: Premiums, deductibles and copayments can change.
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Teva, Apple - >>> Warren Buffett's Berkshire Hathaway buys more Teva and Apple; sells some Wells Fargo
USA Today
Adam Shell
5-16-18
https://www.msn.com/en-us/finance/companies/warren-buffetts-berkshire-hathaway-buys-more-teva-and-apple-sells-some-wells-fargo/ar-AAxng1W
It wasn't just Apple shares that Warren Buffett's Berkshire Hathaway was gobbling up in the first three months of the year.
The billionaire investor also more than doubled his stake in generic drug maker Teva Pharmaceutical Industries and boosted his holdings in agriculture products giant Monsanto.
Teva shares, which Berkshire started buying in the final quarter of 2017, jumped 3% to $21 in Wednesday afternoon trading. It's not uncommon for stocks to rise in value after Buffett's purchase of them is made public.
The moves in Buffett's closely watched Berkshire stock portfolio were revealed in a quarterly regulatory filing that provided an update on holdings through March 31.
Ahead of Berkshire's annual meeting May 5, Buffett revealed that he had purchased nearly 75 million shares of Apple stock. That was confirmed in the filing released Tuesday night. Berkshire's total stake in the iPhone maker is now nearly 240 million shares, valued at roughly $44.7 billion as of last night's closing price of $186.44.
Here are the major stock purchases and sales executed by Buffett in Berkshire's $173 billion stock portfolio in the first three months of 2018.
What Buffett is buying:
Apple: Buffett has bought aggressively over the past year after steering clear of the company for more than three decades. It's now Berkshire's top stock holding. At the company's annual meeting this month, Buffett touted the iPhone for becoming an integral part of Americans' lives. He also backed Apple's recent decision to repurchase $100 billion of its own stock, a move Buffett said would boost his investment.
“I’m delighted to see them repurchasing shares,” Buffett told Berkshire shareholders at the annual meeting. “I love the idea of having our 5%, or whatever it is, maybe grow to 6 or 7% without our laying out a dime. But you have to have a very, very special product, which has an enormously widespread ecosystem, and the product is extremely sticky.”
Teva Pharmaceutical: Berkshire bought 21.7 million more shares of Teva, an Israeli-based drug maker, in the first quarter, more than doubling its stake to 40.5 million shares, according to the filing. It's unclear if Buffett himself is behind the growing Teva stake, or if it is an investment favored by one or both of his stock-picking lieutenants Ted Weschler or Todd Combs. Both money managers, Buffett said at the recent annual meeting, now manage stock portfolios valued at $12 to $15 billion. The filing does not disclose which money manager bought the stock.
Monsanto: Buffett's Berkshire boosted its position in Monsanto, the giant agriculture products maker, by more than 60% with a purchase of 7.3 million shares. Berkshire's total position now totals nearly 19 million shares.
Berkshire also added to its holdings in two banks, U.S. Bancorp and Bank of New York Mellon, as well as Delta Air Lines.
What Buffett is selling:
Graham Holdings: Buffett dumped a newspaper holding that dates to the 1970s. He shed all 107,575 shares of Graham Holdings, the former publisher of The Washington Post.
Wells Fargo: Buffett trimmed his position in his former biggest holding, Wells Fargo, a bank that has been roiled in controversy the past two years due to revelations that it had created accounts for clients without their consent. In the first quarter, Buffett sold 1.72 million shares, leaving him with a still-sizable holding of 456.5 million shares. Buffett defended the bank at Berkshire's recent annual meeting, saying he still likes the stock and supports CEO Tim Sloan.
Phillips 66: Berkshire trimmed its stake in the energy-related company by 35 million shares, or more than 40%. But the sale was previously disclosed by Buffett's company, and it was done to keep Berkshire's total investment below the 10% ownership level that triggers additional regulation and oversight. Berkshire still owns 45.7 million shares of the oil refiner.
IBM: Buffett finally exited his entire position in IBM, selling the final 2 milion shares Berkshire owned. He has long said that buying Big Blue, his first tech purchase, was one of his biggest investment mistakes.
Other small stock sales by Buffett in the first quarter of 2018 included a 266,518 share reduction in Charter Communications, and a 505,600 share sale of United Continental.
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Apple - >>> Warren Buffett’s Berkshire Hathaway bought 75 million Apple shares in first quarter
By Mike Murphy
May 5, 2018
https://www.marketwatch.com/story/warren-buffetts-berkshire-hathaway-bought-75-million-apple-shares-in-first-quarter-2018-05-03
Company already owned 3.3% of Apple’s shares outstanding
Warren Buffett’s company loaded up on Apple Inc. stock in the first quarter, buying a whopping 75 million shares, CNBC reported Thursday night.
That’s in addition to the 165.3 million Apple shares US:AAPL that Berkshire Hathaway US:BRK owned at the end of 2017 — about 3.3% of shares outstanding at the time. As of the end of last year, Apple was Berkshire’s second-largest holding, valued at about $28 billion, behind its stake in Wells Fargo & Co. US:WFC valued at about $29 billion. The latest buying spree likely put Apple in first place.
“It is an unbelievable company,” Buffett told CNBC. “If you look at Apple, I think it earns almost twice as much as the second most profitable company in the United States.”
“Over the last year we’ve bought more Apple than anything else,” Buffett told CNBC in February.
Apple shares rallied 3.3% by midday Friday. On Thursday, the shares closed at $177, up 4.5% year to date and 20.3% in the past year, compared with the Dow Jones Industrial Average’s US:DJIA 3.9% loss this year and 14.2% gain over the past year.
Berkshire’s class B shares ended Thursday at $191.61, and are down 3.3% this year, though up 15% over the past year.
Read: Here’s how Warren Buffett’s stock picks for Berkshire Hathaway have performed in 2018
The latest purchase of Apple stock was reported ahead of an interview with Buffett scheduled to air Friday morning on CNBC’s “Squawk Box.”
Berkshire Hathaway will hold its annual investors’ meeting Saturday in Omaha, Neb.
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>>> 10 companies set to dominate the next decade
http://www.msn.com/en-us/money/companies/10-companies-set-to-dominate-the-next-decade/ss-AAvQeXn#image=2
The Walt Disney Company
Walt Disney (DIS) is still the same magical company it was when you were a kid, but it’s grown into an even bigger powerhouse than it was before. The company’s $4 billion purchase of Marvel Studios back in 2009 gave Disney access to the most popular superhero movie franchises. Then, in 2012, Disney made another gigantic move with its $4 billion purchase of Lucasfilm, giving it ownership of all-things Star Wars, including movies, licensing, and merchandise.
On top of all of that, Disney struck a deal to buy 21st Century Fox’s film and television studios, its cable entertainment networks and TV business for $52 billion in stock at the end of last year. The deal still needs to pass regulatory approval, but if it does Disney will gain all of the aforementioned, as well as the rights to X-Men, Avatar, FX Networks, The Simpsons, and gain a controlling interest in the video streaming service Hulu.
And let’s not forget the company’s dominant position in its theme parks, which will benefit from all of these purchases, and whose revenue already jumped 13% in the most recent quarter. There’s no other company that’s quite like Disney, and with its recent acquisitions it’s making sure it stays that way for a very long time.
Alphabet
Alphabet (GOOG, GOOGL) is the parent company of more than 20 smaller companies, including the tech giant Google. Try to imagine a world where you went just one day without “Googling” something, logging into Gmail, seeing a Google ad on a website, or noticing someone on an Android phone and you’ll begin to realize the tremendous influence of this company.
At the core of Alphabet’s business is, of course, its commanding presence in online advertising through Google. Advertising accounts for nearly all of Alphabet’s sales, which reached a staggering $110.8 billion in 2017. Alphabet’s online advertising dominance helps fund the company’s ventures into new areas like artificial intelligence, driverless car technology and cloud computing, all of which should keep Alphabet safely outpacing its tech rivals for years to come.
Netflix
Netflix (NFLX) has built out such a robust and growing list of original and third-party video content that the company’s streaming subscription has grown into a must-have service for many viewers. If you don’t believe me, then consider the 117.5 million members the company had at the end of 2017, which was a 25% year-over-year jump.
More and more add-on streaming services are hitting the market these days, but that doesn’t mean they’ll take the place of Netflix any time soon. In fact, about 33% of people who have a television streaming services subscribe to two services -- and Netflix is by far the No. 1 choice.
The company is dominating because of its first-mover advantage in the streaming content market and it should continue to hold onto that position as it invests more into its original programming. Netflix has said that it will spend between $7.5 billion and $8 billion this year to create original shows and movies for its streaming service. When you add to all of this the fact that more and more Americans are ditching cable for streaming services it’s easy to see that this company is perfectly poised to lead the pack for the next 10 years.
Facebook
Facebook (FB) is still reeling from revelations that a political research firm, Cambridge Analytica, improperly used and failed to destroy data from tens of millions of Facebook users. The company is facing government investigations as to how it collected and handles Facebook user data and all of this came on the heels of Facebook’s platform being used to show politically divisive ads during the 2016 U.S. election, which were paid for by the Russian government.
But despite all of that mess, I don’t think there’s any reason to believe Facebook won’t continue to dominate the social media landscape for the next decade or more. Consider that Facebook has 2 billion users right now. Two. Billion. A user base like that simply doesn’t fade away, even with the problems Facebook is currently facing.
The Facebook brand itself is taking a hit for sure, but it’s also important to remember that the company also owns other popular social media apps, like Instagram and WhatsApp. The company’s massive reach, successes in digital advertising, and its ability to snatch up popular social media companies are all creating a bright future for Facebook, even if it is experiencing some cloudy days right now.
Apple
A lot of naysayers have been predicting Apple’s (AAPL) decline for years … only to be proven wrong time and time again. Sure, the post-Steve Jobs Apple isn’t the same, but under CEO Tim Cook Apple has thrived and the company remains one of the most dominant tech companies in the world. Apple’s bread and butter is still sales of its iPhone, which have slowed a bit recently, but not to worrying levels.
Apple’s continued success lies in its ecosystem of both products and services, and on that front the company is firing on all cylinders. For example, the company’s services revenue grew 18.5% in the first quarter fiscal 2018, to $8.5 billion. Apple said last year that it wants to double its services business over the next four years and it’s already making great progress. Services sales were up 22% in the trailing twelve-months to $31.2 billion.
It’s also worth mentioning that the company’s Apple Watch sales have now made the company the largest wearable device maker on the planet and its cash hoard of $285 billion means this company has plenty of reserves to continue innovating for years to come. Apple may not seem like the same company it was years ago, but it’s long-term viability is as strong as ever.
Mastercard
Mastercard (MA) and its rival Visa essentially have a duopoly in the payment processing market -- and business is booming. The company charges a fee each time a transaction is made between a cardholder, merchant, or banks, and in the most recent quarter Mastercard’s sales were up 20% from the year ago quarter and its gross dollar volume popped 13% to $1.4 trillion. Mastercard has about 2.3 billion cards issued by 22,000 financial institutions and it makes money every time each one is used. You just can’t beat that type of global reach.
Technology is changing how financial transactions are made, but Mastercard is evolving right along with them. For example, Apple Pay and PayPal’s Venmo app are growing in popularity because of their ease of use in making merchant and peer-to-peer payments. But Mastercard still benefits from these digital payments trends because the cardholders, merchants, and banks are still at to core of the transaction.
Amazon
Amazon.com's (AMZN) influence in the marketplace is staggering. What other company can claim that it provides its customers everything from bed sheets to cloud computing services?
The company built its empire from its e-commerce platform of course, but it has expanded that dominance by offering its own television streaming service and selling its own consumer tech devices like its Fire tablets and Echo smart speakers. To understand how the company’s benefited from building its own ecosystem of devices and services consider that Amazon customers who have an Echo device spend about 70% more on the platform than the average Amazon customer and that Amazon Prime members spend $600 more each year on the site than non-Prime members, according to data from Consumer Intelligence Research Partners.
Any argument that the company is too diversified falls apart pretty quickly when you look at Amazon’s results. The company’s full-year 2017 sales were up 31% from the previous year, it has about 90 million U.S. Prime members spending gobs of money on its website, and its Amazon Web Services (AWS) public cloud computing company dominates the industry with more than 62% market share. Amazon’s ability to enter new markets, while capitalizing on existing ones, means this company can’t be stopped for years to come.
Nike
It’s difficult for any company to reach the level of brand recognition that Nike (NKE) has. Nike has built its retail empire over the past 50 years through superior marketing and sponsorship deals with the world’s most elite athletes. The company’s ability to promote its products and improve upon them year after year is what compels the average customer and full-time athlete to comeback to Nike’s products again and again.
Nike has experienced a bit of a slowdown from its U.S. sales as of late, but it’s balanced that out with diversification in other markets across the globe. Nike has committed itself to bringing new innovations into its manufacturing process, which has already helped the company make its products faster, cheaper, and with less environmental impact than before. This, along with the company’s unparalleled brand, is what will continue driving this company forward for the next decade.
Tesla
Tesla (TSLA) is one of those companies that people either love or hate. Its customers are often its biggest evangelizers (a great sign), while its competitors often point out the company’s missed sales projections and lofty goals set by its CEO, Elon Musk. But when you cut out all of the drama, what you’re left with is an American automaker that is pushing the limits of all-electric vehicles and forcing its rivals to do the same.
Just a few years ago, Tesla was beginning to ramp up manufacturing of its Model S sedan, now it’s building its Model X SUV, has unveiled a road map for its battery-powered semi truck and new roadster, and is building its much-anticipated, mid-priced Model 3. Tesla lags behind the production numbers of bigger rivals -- it built just 34,500 vehicles in the first quarter of 2018 -- but its long-term advantage comes from being one of the only all-electric automakers. Electric vehicles will account for 30% of new vehicle sales by 2040, up from just 1% today.
Naysayers might poke fun at Tesla’s missed production goals now, but if the company continues to make the fastest, sexiest, electric cars on the market it won’t be long before Tesla has the last laugh.
3M
If you’re looking for a company that knows a thing or two about longevity, then look no further than 3M (MMM). The company has been around for more than 100 years and has an enviable track record of raising its dividend for 60 consecutive years. You probably know 3M for its popular Post-It note and Scotch tape consumer products, but the company make a range of products -- 60,000 in all -- including industrial adhesives and films for tech devices.
3M’s advantage over its competitors not only comes from its 112,000 patents and its laundry-list of products, but also from the company’s commitment to spend about 6% of its revenue on research and development to find new products. That type of long-term planning is what has helped 3M not only grow its sales but also see its share price outpace the S&P 500 over the past five, 10, and even 25 years
>>> 10 Safe Dividend Stocks for the Second Quarter
These stocks have been paying their shareholders for a long time
https://investorplace.com/2018/04/10-safe-dividend-stocks-for-the-second-quarter/
By Brian Bollinger
Simply Safe Dividends
With the U.S. stock market fresh off its first quarterly loss since 2015, many conservative investors are in need of dividend stock ideas that can provide safe income and preserve their capital over the long term.
Using Dividend Safety Scores, a system created by Simply Safe Dividends to help investors avoid dividend cuts in their portfolios, we identified 10 high-quality dividend stocks from traditionally defensive sectors like telecom, healthcare and consumer staples.
These stocks have an impeccable record of paying continuous dividends over the years given their durable business models, strong cash flows and disciplined approach to capital allocation.
Many of these companies are also in Simply Safe Dividends’ list of the best high dividend stocks here and trade at yields above their five-year averages, providing an attractive combination of current income and growth.
Let’s take a look at 10 of the best safe dividend stocks for the second quarter.
AT&T (T)
Sector: Telecom Services
Industry: Integrated Telecommunication Services
Dividend Yield: 5.6%
5-Year Average Yield: 5.2%
AT&T Inc. (NYSE:T) is a global leader in telecommunications, media and technology. The company provides wireless and wireline communications services, including data, broadband and voice, digital video services, telecommunications equipment and other services.
AT&T has a huge customer base consisting of 157 million wireless subscribers, over 12 million internet subscribers and around 25 million video customers.
Few companies can compete with AT&T’s massive scale, which allows it to invest heavily in the quality and coverage of its cable, wireless, and satellite networks. In fact, AT&T is planning to deploy the next generation 5G wireless technology in 12 U.S. markets by late 2018.
Should AT&T’s acquisition of Time Warner be completed, the deal has potential to create value for shareholders and customers by combining its strong distribution capabilities with Time Warner’s large content portfolio.
While this deal will increase AT&T’s debt burden, Simply Safe Dividends estimates that the combined company’s free cash flow payout ratio will sit around 70% to 80%, which is sustainable for a cash cow with recession-resistant services like AT&T. Investors can read the firm’s in-depth dividend stock analysis on AT&T here.
AT&T has recorded 34 consecutive years of quarterly dividend growth and last raised its payout by 2% in late 2017. An improving balance sheet and moderately growing demand for faster delivery of video and data services should enable the company to continue raising its dividend at a low single-digit pace.
Pfizer (PFE)
Sector: Healthcare
Industry: Pharmaceuticals
Dividend Yield: 3.8%
5-Year Average Yield: 3.5%
Pfizer Inc. (NYSE:PFE) is a global biopharmaceutical giant engaged in the development and manufacture of healthcare products. It is one of the largest global pharmaceuticals companies, with 2017 revenues exceeding $52 billion.
Founded in 1849, Pfizer has come a long way to become a leading healthcare company, with manufacturing sites in 63 locations and sales in 125 countries. The company has a wide portfolio of medicines, vaccines and consumer healthcare products and is known for popular drugs like Prevnar and Viagra, among others.
The company’s business can be divided into two distinct business segments — Pfizer Innovative Health (focusing on six therapeutic areas like oncology) which accounted for 60% of 2017 revenues and Pfizer Essential Health (legacy drugs that have lost patent protection) comprising the remaining 40%.
A relatively recession-proof business model, diversified portfolio of R&D intensive products, and global scale create a competitive moat around the company.
Pfizer is also benefiting from U.S. tax reform, which has driven the firm to repatriate most of its cash held overseas and aggressively return cash to shareholders.
The company last raised its dividend by 6.3% in December 2017, and mid-single-digit growth is likely to continue. In fact, management expects 11% earnings growth in 2018, and rising global demand for healthcare should continue to serve as a long-term tailwind.
Income investors can read Simply Safe Dividends’ comprehensive analysis on Pfizer’s business here.
Procter & Gamble (PG)
Sector: Consumer Staples
Industry: Household Products
Dividend Yield: 3.5%
5-Year Average Yield: 3.1%
Procter & Gamble Co (NYSE:PG) is a leading global consumer goods company. With more than 180 years of existence, the company is today an international household name, selling products in more than 175 countries.
Accounting for 32% of total sales in 2017, fabric and home care is Procter & Gamble’s biggest segment, followed by baby, feminine and family care (28%), beauty (18%), grooming (11%) and health (11%) segments.
By geography, North America is P&G’s largest market (45% of sales) while developing economies account for 35% of its total sales.
A diverse portfolio of iconic brands (Ariel, Bounty, Braun, Olay, Pantene etc.), strong consumer loyalty, and a global sales network have made P&G one of strongest consumer goods companies in the world.
In recent years the company has restructured its brand portfolio (from 170 in 2013 to 65 today) to focus more on stronger product lines with faster growth and greater profitability. The company also has targeted to save $10 billion in operating costs between fiscal year 2017 and 2021.
Despite its modest growth profile, Procter & Gamble has an impeccable record of paying consecutive dividends over the last 127 years. It last raised its dividend by 3% in 2017, marking it the 61st consecutive dividend increase and reinforcing its status as a dividend king (see all the dividend kings here).
The company is targeting up to $70 billion in capital returns through fiscal 2019 and 5% to 7% in core earnings per share growth. This should enable the company to comfortably continue its dividend growth streak.
United Parcel Services (UPS)
Sector: Industrials
Industry: Air Freight and Logistics
Dividend Yield: 3.4%
5-Year Average Yield: 2.9%
United Parcel Service, Inc. (NYSE:UPS) is a holding in Warren Buffett’s dividend portfolio here and is the world’s largest package delivery and logistics company. It is also a premier provider of global supply chain management solutions.
The company operates through three segments: U.S. Domestic Package (62% of 2017 revenue), International Package (20%) and Supply Chain & Freight (18%).
UPS has a balanced presence globally delivering 20 million packages and documents each day in more than 220 countries. The US is its largest market with 79% of sales while Europe is the largest among international markets (21%).
The company has an extensive global logistics and distribution system consisting of 2,500 worldwide operating facilities, 119,000 vehicles and over 500 aircraft. Upstarts and smaller rivals cannot afford to invest in such a transportation network, and they lack UPS’s package volumes which help the company achieve meaningful cost efficiencies.
Thanks to its advantages, UPS has been paying generous cash dividends for the last 50 years. The company’s recent payout boost in late 2017 represented a 10% increase over the prior year, and analysts expect 2018 adjusted diluted earnings per share to grow by 20% thanks largely to tax reform.
Given the continued surge in global online shopping trends and long-term growth in global trade, the company should be able to continue increasing its dividend comfortably in the high single to low double-digit range.
Verizon Communications (VZ)
Sector: Telecom Services
Industry: Integrated Telecommunication Services
Dividend Yield: 4.9%
5-Year Average Yield: 4.5%
Verizon Communications Inc (NYSE:VZ) is the biggest provider of wireless service in the U.S. with 116.3 million retail customers and enjoys a duopoly position with AT&T, Sprint Corp (NYSE:S) and T-Mobile US Inc (NASDAQ:TMUS).
The company has the largest 4G LTE network (with 97.9 million retail postpaid connections) and is available to over 98% of the U.S. population. Although wireless operations generate over 80% of the company’s cash flow, Verizon’s superior fiber-optic technology also enables high speed broadband internet and has been ranked No.1 for internet speed ten years in a row by PC Magazine.
Customers prefer Verizon for its highly reliable wireless services, which are made possible by substantial investments in its network each year. The company also owns highly valuable and scarce telecom spectrum licenses, which form a strong entry barrier for new entrants.
Verizon is also leading the 5G wireless technology development over the last few years to reinforce its strong position, and it has plans to launch 5G wireless residential broadband services in three to five U.S. markets this year.
With tax reform freeing up several billion dollars more of cash flow this year, and management’s plans to cut $10 billion in costs by 2022, Verizon’s dividend remains on solid ground.
Verizon recorded its 11th consecutive dividend increase in 2017 with a 2.2% raise, and low-single-digit growth is likely to continue in the years ahead as the company trims its cost base and benefits from growing demand for high speed data and internet.
Coca-Cola (KO)
Sector: Consumer Staples
Industry: Soft Drinks
Dividend Yield: 3.5%
5-Year Average Yield: 3.2%
The Coca-Cola Co (NYSE:KO) is one of the largest beverage companies in the world, manufacturing and distributing more than 500 non-alcoholic drink brands. It owns four of the world’s top five sparkling soft drink brands — Coca-Cola, Diet Coke, Fanta and Sprite.
Coca-Cola’s activities can be grouped into five operating segments — Europe, Middle East and Africa (21% of 2017 revenues); Latin America (11%); North America (24%); Asia Pacific (14%); and Bottling Investments (30%).
Coca-Cola owns the world’s largest distribution system that enables seamless sales to 27 million customer outlets in more than 200 international markets. This distribution network serves as a major advantage as the company evolves its product mix.
As a result of increased customer health awareness, the company is focusing on constructing a healthier portfolio by introducing products like Coca-Cola zero sugar.
The Coca-Cola Company is a dividend aristocrat (see all the aristocrats here) that has increased dividends in each of the last 56 years and last raised its payout by 5%. The company has a target of a 75% payout ratio and 7% to 9% earnings growth over the long term.
Given its industry leading position, strong brands, and huge international presence, Coca-Cola should be able to continue delivering mid-single-digit dividend growth in future.
Merck (MRK)
Sector: Healthcare
Industry: Pharmaceuticals
Dividend Yield: 3.6%
5-Year Average Yield: 3.1%
Merck & Co., Inc. (NYSE:MRK) is a global healthcare company with a rich operating history exceeding 120 years. The company provides a host of prescription medicines, vaccines, biologic therapies and animal health products.
Geographically, the U.S. is its largest market with 43% of 2017 revenues, followed by EMEA, Asia Pacific, Japan, Latin America and others.
Merck’s core product categories include drugs for diabetes and cancer as well as vaccines and hospital acute care. A few of Merck’s best-selling products are Januvia (industry leading diabetic drug), Keytruda (cancer drug), Zetia and Remicade. The company’s 12 main drugs accounted for 53% of total sales in 2017.
The company spends heavily on R&D (18% of sales in 2017) to continuously rebuild its drug pipeline and deliver innovative health solutions. As a result, Merck is in a solid position to benefit from the growing demand for oncology treatments. The company has also been restructuring its business to cut long-term costs.
Merck has a rich history of paying uninterrupted dividends for nearly three decades and has increased dividends for seven years in a row. Its last dividend was raised by 2%, which is in line with its 10-year annual dividend growth rate.
Given the company’s disciplined capital allocation and reasonable payout ratio below 50%, Merck is poised to continue growing its payout in the future.
Altria (MO)
Sector: Consumer Staples
Industry: Tobacco
Dividend Yield: 4.4%
5-Year Average Yield: 4.0%
Altria Group Inc (NYSE:MO) is the undisputed market leader in the U.S. tobacco industry. The company has exclusive rights to sell cigarettes under a handful of leading brands including Marlboro, Virginia Slims, Parliament and Benson & Hedges. Altria also sells cigars, chewing tobacco and wine.
Marlboro has been the leading U.S. cigarette brand for over 40 years, and Copenhagen and Skoal account for more than 50% of the smokeless products category. Cigarette brands tend to have a high degree of stickiness, with customers having a very low preference to switch to other brands and a greater tolerance to pay higher prices given the addictive nature of tobacco.
With a long history of manufacturing cigarettes dating back 180 years, Altria has built a dominant market position over the years, resulting in a steady and growing stream of cash flow that has funded solid dividend growth.
In fact, Altria’s latest dividend raise earlier this year was 6%, representing its 52nd dividend increase in the past 49 years. Altria has a target dividend payout ratio of 80% with annual earnings growth of 7% to 9% expected over the long term. This should allow the company to keep growing dividends at a mid to high single-digit clip going forward.
AbbVie (ABBV)
Sector: Healthcare
Industry: Biotechnology
Dividend Yield: 4.2%
5-Year Average Yield: 3.5%
AbbVie Inc (NYSE:ABBV) is a research-driven global healthcare company, focusing on developing and delivering drugs in therapeutic areas like immunology, oncology, neuroscience, virology and general medicine. The company generates over 60% of its revenue (and an even greater share of profits) from its arthritis drug Humira.
Humira’s revenue stream in the U.S. is expected to be largely protected from competition through 2022 thanks to a number of patents owned by AbbVie. Meanwhile, AbbVie’s R&D expertise has helped the company develop a strong late-stage pipeline of promising medicines across several therapeutic areas which could potentially be converted into successful products in the near future.
The company recently experienced a setback as Rova-T, a lung cancer drug that was a key part of AbbVie’s plans to diversify its future profits, experienced achieved disappointing trial results, suggesting its overall impact on the company’s future results would be somewhat muted.
However, the company remains a cash cow with a handful of growth drivers and a reasonable payout ratio near 50%. Management continues cranking up the dividend, most recently announcing a 35% boost earlier this year.
New product launches and increasing demand for medicines both from developed and developing economies should help AbbVie grow its dividends at a solid rate going forward, but investors considering the stock do need to have a stomach for volatility given AbbVie’s drug concentration.
Cisco (CSCO)
Sector: Information Technology
Industry: Communications Equipment
Dividend Yield: 3.2%
5-Year Average Yield: 3.2%
Cisco Systems, Inc. (NASDAQ:CSCO) is a leading global technology company inventing new technologies and products that have been powering the internet for more than three decades.
Product sales account for approximately 75% of total sales while services comprise the remainder of the business. Switching and routing are the most prominent product categories followed by collaboration, data center, wireless, security and service provider video.
The company’s service revenue is composed of software, subscriptions, and technical support offered across its different segments. Cisco’s customers are highly diversified and include businesses of all sizes, public institutions, governments and service providers.
Cisco has a large worldwide sales and marketing network with field offices in 95 countries, strong R&D capabilities, and a massive patent portfolio. Market leadership, breadth of portfolio, global scale and customer loyalty are its key competitive advantages. Investors can read in-depth analysis of Cisco’s business here.
Cisco is also shifting its business towards a software and subscriptions model which will lead to a higher visibility of its cash flows. Currently, recurring revenue accounts for 33% of total sales, and more than half of software revenue is subscription based revenue.
Cisco recently increased its dividend by 14% and has targeted to return at least half of its free cash flow to shareholders annually. The company’s solid cash flow and sub-50% payout ratio should allow for continued dividend growth in the years ahead.
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>>> Avoid these mistakes with inherited IRAs
By Eric Vogt
Jan 24, 2018
https://www.marketwatch.com/story/avoid-these-mistakes-with-inherited-iras-2018-01-24
Here are some guidelines to consider when incorporating an inherited IRA into your financial plan.
Intergenerational wealth transfers create opportunities and risks, especially for those inheriting a large sum of money. And with boomer heirs on the precipice of the largest wealth transfer in history — an estimated $30 trillion over the next few decades — understanding the finer points of an inherited IRA is more important than ever.
Because it is someone else’s retirement plan, an inherited IRA can come across as almost alien to those on the receiving end, and recipients often have many questions: What options do I have for taking distributions? What are the tax implications? How do I incorporate this inheritance into my existing financial plan?
To make understanding the options a little simpler, below are some guidelines to consider when incorporating an inherited IRA into your financial plan. As you’ll see, it helps to distinguish between an IRA you inherit from your spouse and an IRA you inherit from a parent, sibling or someone else (where you’re determined to be a non-spouse inheritor).
Inheriting a traditional IRA from your spouse
You can roll over this inherited IRA into an IRA you already have and the earnings will continue growing tax-deferred. You’ll pay income taxes on any distributions you take but, if you’re over age 59½, you won’t owe the 10% tax penalty for early withdrawals.
Rolling over an inherited IRA can be appealing, since you will gain control over the distributions. You just need to be sure the amount you withdraw is above the annual Required Minimum Distribution (RMD), the minimum amount you must withdraw from your IRA account each year once you have reached 70½.
It’s important to realize that taking inherited IRA distributions — especially a lump sum distribution — may bump you into a higher tax bracket, since the money will be counted as earned income for the year. Depending on your age, financial situation and immediate needs, however, a lump sum distribution can still make sense, since it will let you access the entire benefit right away. There is no 10% early withdrawal penalty for a lump sum distribution, but it will incur income taxes.
If you prefer to forego an immediate payout in favor of investing the inherited IRA, identify your investment goals and then incorporate your IRA allocation into your overall financial plan.
Inheriting a traditional IRA from a parent or sibling
Here, too, you’ll pay income taxes on distributions from the inherited traditional IRA. You can’t, however, roll the inherited IRA into an existing IRA and you must begin withdrawing assets no later than December 31 of the year after the account holder died.
These distributions will be considered part of your annual income, and could bump you into a higher tax bracket. Conversely, if you don’t take the necessary distributions, you will incur a 50% tax penalty on the amount taken out below the RMD.
Inherited IRA distribution rules
Beneficiaries of inherited IRAs can choose to take distributions as an RMD over the course of their lifetime (what’s known as the life expectancy method), over a five-year period or as a lump sum.
The life expectancy option means a RMD will be set each year by the IRS, which must be made each year to avoid paying the 50% penalty on the amount taken below the RMD.
The five-year option gives you the ability to withdraw the funds throughout the five years, there are no RMDs and there is no early withdrawal penalty. After five years, any remaining funds in the account will need to be withdrawn.
The lump sum distribution results in a full payout of the account, paid out immediately after inheriting an IRA. You won’t incur a 10% early withdrawal penalty, but you will owe income taxes.
For most situations, the life expectancy option will be the most beneficial distribution method, since the funds remaining in the IRA will provide a lifetime of tax-free growth, before distribution.
The rules for inherited Roth IRAs
A Roth IRA is a retirement account funded with posttax income that lets the account owner take distributions without paying income tax. When you inherit a Roth IRA, you also won’t pay income tax on your distributions, nor will the distributions count as taxable income when determining your tax bracket.
However, if you elect to take the life expectancy method, distributions that fall below the RMD will still be subject to the 50% penalty.
Mistakes people make with inherited IRAs
People typically make two mistakes when inheriting IRAs: They either forget to take the RMDs, or, with traditional IRAs, they take a lump sum distribution in a high-income year.
The first mistake results in a 50% penalty on the amount taken below the RMD. The second may cause the entire distribution amount to be taxed at a higher rate than necessary.
For individuals inheriting an IRA, understanding your options as well as the requirements and potential liabilities of those options is essential to making an informed election and to maximizing your potential benefits.
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Sub .01 Silicon Valley Biotech ********
Arrayit (ARYC) is located in the heart of Silicon Valley (927 Thompson Place
Sunnyvale, CA 94085
USA) and product sales are comparable to a company with a Market Cap 40X + where it is currently. We are awaiting completion of the audit covering 2014, 2015, 2016, and Q1 - Q3 of 2017. Upon the completion we expect share price to multiply many times. Most companies trade at 15-28X earnings, ARYC is trading at less than 1 times earnings.
Please do your due diligence and review these links I am providing.
Shareholders are welcome to visit the company which is something that is almost never found in sub $ stocks.
Arrayit's products are selling, in the tens of thousands of dollars .... every single day (@Arrayit on Twitter) Trading at under a penny per share and the float is almost entirely locked. Anyone selling their shares currently has not done any real due diligence on the company. Arrayit has, and is, undergoing drastic changes and is in the process of getting current in their financials using the prestigious audit firm RRBB.
A link to their products list:
http://www.arrayit.com/Products/products.html
The company is working to increase your share price and has actually stated that is its intention. Do not miss an opportunity, buy as many shares as possible, I know the share price for Arrayit has potential to reach $.25 to .75 a share, easily, with PPS potential of $1+ next year. This is an opportunity of a lifetime.
ARYC: Arrayit
http://www.arrayit.com/
@Arrayit
Check out their website:
www.arrayit.com
Arrayit Corporation
927 Thompson Place
Sunnyvale, CA 94085
USA
Phone 408-744-1331
FAX 408-744-1711
Email arrayit@arrayit.com
Web www.arrayit.com
Dont forget FNHI! Soon to be a big one!
Q1, Q2, Q3, Current, QB, CSE STOCK EXCHANGE!, FUNDING, REVENUE GROWTH!
10 bagger, 20 bagger, 30 bagger easily from here!
GE - >>> There’s still some good at GE — but much more bad and ugly
By Jeff Reeves
Nov 14, 2017
https://www.marketwatch.com/story/theres-still-some-good-at-ge-but-much-more-bad-and-ugly-2017-11-13?siteid=bigcharts&dist=bigcharts
Stagnant thinking, a Dow death watch and more
This is not the time to take a chance on General Electric.
Shares in the industrial giant GE, -5.52% have fallen to fresh 52-week lows after the industrial giant slashed its dividend in half, the second reduction in payouts in less than a decade. The longer-term picture also is ugly: The stock is down almost 40% so far this year, compared with 15% gains for the S&P 500 SPX, -0.29% .
The dividend cut is part of a series of big items revealed in the company’s “investor day” event on Monday. And while a few of the items were encouraging, plenty of other items are working against the stock.
Personally, I don’t see General Electric as a wise bet. Momentum was against the stock before the dividend cut, and the burden is on GE to disprove the existing narrative of mismanagement and stagnant growth prospects.
Here’s what’s good, bad and ugly about GE right now.
The good
A fresh start under Flannery: Sure, CEO John Flannery is admittedly a GE insider and not a transformative outside hire, but a fresh face at the top is an important first step in changing the culture and trajectory. Given GE’s complicated corporate structure, it may not be possible to find a better outside hire — and at least the company did expedite a changing of the guard with ex-CEO Jeff Immelt stepping down early. Flannery came off as pragmatic and level-headed at investor day, which is encouraging.
Deeper cuts: The big dividend cut is only the start of reduced spending at GE. There is a planned reduction in board seats, which will save salary as well as simplify management as top execs are compensated more in equity stakes than in cash to align incentives with shareholders. And previous rumors of “aggressive” layoffs show that positions are being cut all around as the company streamlines. All in, GE expects to cut costs by over $3 billion going forward, with $2 billion in cost reductions in the next year.
Expected exits: While there may not be a major corporate shake-up, Flannery admitted in his investor day commentary that “complexity has hurt us.” General Electric is tactically exiting smaller parts of its non-core businesses. There are reports that the company will unload its majority stake in Baker Hughes BHGE, -5.45% after a recent merger between the firm and GE’s oil and gas business as one example. That would both help streamline the business and raise cash.
Funding growth: Cutting alone won’t turn GE around. So it was encouraging to see a vow in the investor day presentation to spend more on key areas. Notably, there were hints at investments in the growing Life Science division as well as opportunistic spend in its Aviation unit to capitalize on military demand under the expansionary defense policies in Washington. Both are logical in the scope of GE and in the broader business environment.
More transparency: When I warned investors off GE in an October column, I mentioned GE’s hard-to-understand operations as a big red flag. This is a common complaint from investors, and GE on Monday pledged to make its balance sheet simpler to understand. This gesture was undoubtedly in part born out of a “comment letter” from the Securities and Exchange Commission in July warning that its filings were potentially misleading, but the change is a welcome one for GE investors nevertheless.
The bad
Dividend cut: The big news is that GE cut its dividend in half, from 24 cents quarterly to 12 cents. Worse, this is the second mammoth dividend cut in less than eight years, after it slashed payouts from 31 cents to 10 cents in 2009 after the financial crisis.
Third-quarter earnings miss:Say what you want about the top-line troubles, but GE had previously been remarkably consistent about meeting expectations on earnings. That didn’t happen in its third-quarter report, however — the first miss in 2½ years.
Forward guidance: Worse, that earnings trouble doesn’t seem like an isolated incident. At its investor day meeting, the company announced significantly lower earnings and free cash flow numbers. That is worrisome in the near term.
No big breakup: GE has pledged a bigger focus on its three core lines of aviation, power and health care. But thus far, there is no radical restructuring or breakup plans involved — just a “granular diagnostic of each GE business” as it was so tediously framed in the investor day presentation. Investors have been turned off by the lack of urgency and slow progress to transform this conglomerate, and it’s worth asking when General Electric will ever truly “right-size” its business if it won’t do so after the pain of 2017.
Pessimistic analysts: A widely followed Cowen analyst recently calculated a valuation for GE stock, giving it a total price tag of $11 to $15 per share if the company was parceled off and sold for parts. That’s an ugly 25% to 45% downside from here, and doesn’t show a lot of value to be had from selling off lesser parts of the business. Elsewhere, J.P. Morgan reiterated an “underweight” rating in early November after earnings, with a target of just $17. Even after the pain thus far in 2017, some investors think there is more downside to come.
The ugly
Downside momentum: Like the declines we saw during the 2008 market crash, the waterfall declines in GE stock show no sign of abating. Shares are down nearly 40% from their January high in an almost steady downward spiral to prices not seen since 2012. Longer term, shares have declined roughly 50% since November 2001. It’s hard to believe in a stock with a history like this.
Stagnant thinking: Despite a pretty ugly track record of the last decade or so, General Electric is an insular company that doesn’t seem to care about looking outside itself for solutions. A great Bloomberg piece this summer highlighted how top executives under Immelt moved on to run other companies, among them Boeing, Home Depot and Honeywell — and starved GE of brain power. Now, when things look grim at GE, we once again have an insider taking the helm. A lack of outside perspective is fine if you’re succeeding, but that hardly seems wise at a struggling firm like GE.
Pension problems: Pension obligations loom large over GE, and the $31 billion shortfall remains a big concern. The company hinted at these liabilities in its “capital allocation principles” at investor day, and it’s clear that some of the savings from cost-cutting will be going into this black hole and not into actually making GE a better company.
Dow death watch: For a long time, GE has been seen as one of the weakest components in the Dow Jones Industrial Average despite being the only company that has been included since the blue-chip index was founded. Just as once dominant Alcoa and AT&T got bumped from the index for the likes of Apple and Visa, GE could easily be bumped for a corporation that is more representative of the 21st century economy. That loss of a spot in a benchmark index in the age of index fund dominance could be a very bad thing for an already struggling GE.
Wasted buybacks: GE’s investor day presentation continued to tout “opportunistic use of buybacks.” However, the history of repurchases at the industrial giant hardly seem opportunistic given the roughly $45 billion spent on buybacks in 2015 and 2016 rather than allocated toward long-term business solutions. That hardly seems a wise use of capital, and hints any extra cash may be misspent again in 2018.
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>>> GE shares tumble 5% after CEO's pledge for 'more focused' company fails to sway investors
CNBC
11-13-17
https://www.cnbc.com/2017/11/13/ge-announces-broad-restructuring-to-keep-health-care-aviation-and-energy-units.html
•General Electric announces it will cut its dividend in half as part of a broader corporate restructuring.
•It plans a renewed focus on health care, aviation and energy.
•CEO John Flannery apologizes on investor day for the company's performance and says GE would be "more focused."
General Electric set forth a new agenda on Monday as it tries to restructure its way back to stronger growth, with earnings estimates lower than Wall Street forecasts, a reduced dividend and an aggressive corporate restructuring.
The Boston-based 125-year-old industrial conglomerate also said it was cutting the number of seats on its board as part of what its chief executive called "a reset year" in 2018. GE also will be slicing 25 percent of staff from the home office.
Investors recoiled at the news about the dividend and restructuring, sending shares down nearly 6 percent in heavy trading.
"The GE of the future is going to be a more focused industrial company," CEO John Flannery said during his presentation at the company's investor day Monday. "It will leverage a lot of game-changing capabilities."
The event happened amid a plunging share price and as Flannery announced an "extremely painful" halving of the quarterly dividend to 12 cents a share. The restructuring plan said the dividend was set "with a path to grow going forward" but marks the largest cut by an S&P 500 during an nonfinancial crisis year.
"This is the opportunity really of a lifetime to reinvent an iconic company," Flannery added.
There will be a renewed focus on health care, aviation and energy, according to a presentation released for investors prior to the meeting. That's in contrast to the current wide-ranging set of interests that also includes media, railroads, chemicals, marine engines and banking.
For Flannery, it also represents a divergence in management style away from the high-flying aggressiveness of Jeff Immelt and Jack Welch.
"I was forced to confront a lot of the sort of deeper questions about the company," Flannery said. "What's the essence of the company I love so much?"
The company now sees adjusted earnings for the year ahead of $1 to $1.07 a share and free cash flow still at significantly reduced levels of $6 billion to $7 billion, which it pledged to improve. As expected, GE said it is looking to exit more than $20 billion of assets as it tries to sharpen its focus on "what makes a 'GE' business."
In addition, the company said it will "address overcapacity" and simplify its portfolio. While it slashed its dividend in half, the company also set a $3 billion share buyback priority. Addressing its pension plan shortfalls, Flannery said the company will borrow $6 billion to take advantage of the current rate environment.
The board of directors will be reduced from 18 to 12, with three new members slated "with relevant industry experience." Directors will have 15-year term limits.
"We have not performed well for our owners," Flannery said. "This is unacceptable, and the management team is completely devoted to doing what it takes to correct that."
Employee bonuses also will be restructured, with elimination of the three-year cash long-term performance awards and a switch to a program that conforms to "market norms."
The dividend allocation will be $4.2 billion for 2018, pushing it from above 100 percent of free cash flow to 60 percent to 70 percent, and the dividend yield from 4.7 percent to 2.3 percent. The yield had been the highest in 30 years not counting the financial crisis.
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>>> Verizon Communications Inc. Stock is a Dividend Investor’s Dream
There's a bull case for why Verizon is primed for growth
Nov 1, 2017
By Chris MacDonald
https://investorplace.com/2017/11/verizon-communications-inc-stock-is-a-dividend-investors-dream/#.WgfAV8KWzht
Verizon Communications Inc. (NYSE:VZ) is a difficult company for many long-term investors to own due to the tectonic plates of the wireless and telecommunications industry that remain in a constantly shifting state. VZ stock is down more than 10% going into the final two months of the year.
A series of price wars has ensued between VZ and its largest competitors in a bid to stave off what would has become an all-out assault on traditional television, cable, and FiOS video providers. This past quarter, VZ lost 18,000 FiOS customers, 5% more than analyst estimates for the segment.
With margin erosion and long-term headwinds prevailing for many of the core businesses operated by VZ, it can be difficult to put a bull case together for the company.
Investors have begun to flee VZ stock in favor of companies with perceived advantages in their sectors, largely ignoring many of the key growth initiatives which stand to create a new VZ more in line with what consumers are looking for and where consumers are spending their money.
In this article, I’m going to discuss a few of the factors I believe will set VZ apart from its competitors, and why VZ remains very attractively valued when considering the company’s dividend and future cash flow generating abilities.
Where’s the Long-Term Value in Verizon
VZ’s core product offerings have done well of late, and despite dropping more than 10% since Jan. 1, VZ has posted a solid rally since late summer when the company dipped below $43 per share on news that subscriber growth outpaced analyst expectations and was among the best of its peers. During the company’s fiscal third quarter, more than 600,000 wireless customers were added to VZ’s platform, a number which was boosted (at least temporarily) by all-you-can-use unlimited data plans introduced earlier this year.
Besides spurring higher-than-expected top- and bottom-line performances for the previous quarter, what is particularly notable is that this increase is likely to result in some investors giving VZ more rope as the company rolls out new initiatives linked to its recent acquisitions of Yahoo! Inc. and AOL, Inc. (which have now been rolled into Oath). The goal will be for VZ to grow its online advertising business to challenge rivals Alphabet Inc (NASDAQ:GOOGL) and Facebook Inc (NASDAQ:FB) in this high-margin space, an attractive opportunity which deserves to be fairly valued.
VZ will also continue its search for a partner in its bid to launch an online television service, a project which has been delayed several times already and may continue to be postponed. With the devil in the details in rolling out a massive project like this, I anticipate many investors will sleep better knowing VZ’s management team is taking its time in rolling this out to avoid a failure which may be catastrophic for the organization. This will be the major “make-or-break” project for VZ in the upcoming quarters.
VZ Still a Best-of-the-Dow
In terms of fundamentals, VZ remains one of the best companies currently in the Dow Jones Industrial Average. It is hard to miss VZ stock’s massive dividend of nearly 5%, a dividend which has grown as the stock’s value has declined in the last 10 months.
In terms of valuation, VZ remains cheaply valued at approximately 10x operating cash flow. While the company does carry a large debt load, as is commonplace in the industry, its recent acquisitions have not served its liquidity ratios well, and management will need to continue to monitor the company’s debt load accordingly.
With top-line numbers continuing to improve and the company’s gross and net margins remaining very robust, it is important to note that the majority of analysts believe Verizon remains in a solid position to take advantage of future capital intensive opportunities at its current state.
Bottom Line on VZ Stock
Verizon is a company with excellent potential for growth in a mature industry with relatively simple cash flows to value looking forward. With analyst estimates for growth somewhat muted, and perhaps not encompassing many of the growth initiatives underway, I expect room for increased valuation multiple expansion as market sentiment for VZ stock becomes increasingly more bullish.
A strong balance sheet supports a management team with a proven track record (three decades’ worth) of returning value to shareholders in the form of a robust and growing dividend. Long-term income-focused investors should consider picking up shares of VZ on any dips moving forward as the company continues its transition toward utilizing its asset base more effectively.
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>>> Duke Realty Corporation is a self-managed real estate investment trust (REIT). The Company and Duke Realty Limited Partnership collectively specialize in the ownership, management and development of bulk distribution (industrial) and medical office real estate. It operates through three segments, the first two of which consist of the ownership and rental of industrial and medical office real estate investments. The operations of its industrial and medical office properties, as well as its rental operations, are collectively referred to as Rental Operations. The third segment includes real estate services, such as property management, asset management, leasing, development, general contracting and construction management. Its Service Operations segment also includes its taxable REIT subsidiary, through which certain of the segment's operations are conducted. It maintains a Baa1 rating from Moody’s Investor Service, Inc. and a BBB+ rating from Standard & Poor's Financial Services LLC. <<<
>>> Philip Morris hopes smokeless is the new smoking
By Saabira Chaudhuri
Nov 6, 2017
https://www.marketwatch.com/story/philip-morris-hopes-smokeless-is-the-new-smoking-2017-11-06?siteid=bigcharts&dist=bigcharts
‘Heat not burn’ products have become an obsession for the company’s CEO
Bloomberg
Philip Morris International is hoping smokers will prefer IQOS, which heats tobacco, instead of existing e-cigarette options that heat a nicotine-laced liquid but contain no tobacco.
Cigarette maker Philip Morris International Inc. PM, +0.55% is betting big on smokeless products with a device called IQOS that heats but doesn’t burn tobacco.
The number of cigarettes big companies sell is declining and, with regulations continuing to tighten, the companies are focused on future-proofing their business, investing in e-cigarettes and “heat not burn” products that they say are less harmful than traditional cigarettes. Philip Morris has joined with Altria Group Inc. MO, +0.79% to apply for Food and Drug Administration approval to market IQOS in the U.S. as a less risky alternative to cigarettes.
Philip Morris, spun off from Altria in 2008, sells cigarettes only outside the U.S.; Altria sells cigarettes only in the U.S. If Philip Morris’s IQOS wins FDA approval, it will be sold in the U.S. by Altria in a licensing agreement with Philip Morris, which will receive royalties from U.S. sales.
Making IQOS—pronounced eye-koss—a success has become an obsession for the company’s chief executive, André Calantzopoulos.
A tobacco industry lifer and former smoker, Calantzopoulos is a walking advertisement for his new product, puffing away on the cigarette-shaped device through the day. He’s counting on lower taxes and looser marketing restrictions than those levied on traditional cigarettes to push smokers to switch to these new, higher-margin products.
He’s also betting many smokers will prefer IQOS, which heats tobacco, to existing e-cigarette options that heat a nicotine-laced liquid but contain no tobacco, making for an experience that’s less like traditional smoking.
Philip Morris has poured money into clinical trials that have shown IQOS is safer than smoking. The company maintains that combustion, rather than the tobacco or nicotine in cigarettes, is what’s harmful. Critics say more long-term studies and independent research are needed to evaluate IQOS’s health effects.
The company in January relaunched its website, stripping away prominent mentions of big moneymakers like Marlboro and Benson & Hedges cigarettes and touting its decision to “develop, market, and sell smoke-free alternatives, and switch our adult smokers to these alternatives, as quickly as possible around the world.” In September, Philip Morris pledged $1 billion to create a foundation to encourage people to switch to smoke-free alternatives.
Critics note the company is still aggressively selling traditional cigarettes while challenging display bans and rules in some places that require plain packaging with graphic health warnings.
“I don’t see any sign at all they’re backing off the very aggressive effort to sell as many traditional Marlboros to as many people as they can,” says Matthew Myers, head of the Campaign for Tobacco-Free Kids.
In an interview with The Wall Street Journal, Calantzopoulos discussed how Philip Morris sees the future of smoking and why he thinks IQOS is the key to the company’s success. Edited excerpts follow.
Filling a gap
WSJ: With e-cigarettes already available in so many markets, why do we need IQOS?
Calantzopoulos: The problem we had with electronic cigarettes since the beginning of development was the satisfaction of the smoker. Because the taste is dramatically different and, at the initial stages, the nicotine pharmacokinetics were very slow. You could not get the satisfaction. It’s not so easy to crack this code.
The taste satisfaction is very important. The closest you are to this, the more chances you have to switch people. It’s very nice to have a zero-risk product, but if nobody uses it, you don’t have any reduction in public health risk.
Which markets are likely to be the biggest ones for these new, alternative products?
Calantzopoulos: When you look at the potential of these products you need to understand what is the readiness of smokers to switch. That relates to public-health concerns, social pressure, concern for people around you and many other more subtle things. You cannot say that Indonesia is at the same level of readiness as the U.K, Western Europe or the U.S.
The potential is in every market, because eventually I think people will switch to these products as they become available. There are two unmet needs in smokers: something that is much better for my health and something that bothers others much less or doesn’t bother them. These are things cigarettes can’t resolve. These new products are developed to address these needs.
What’s more profitable for you, IQOS or traditional cigarettes?
Calantzopoulos: Today it’s IQOS because of the lower taxes.
You say you don’t want to encourage new cigarette smokers. If that’s true, will you have a business in 40 years? What’s the long-term plan?
Calantzopoulos: First, I don’t think it’s 40 years we’re talking about here. It’s much longer. Second, we only have, if you include China, a 15.4% share of the world [cigarette market outside the U.S.] With [alternatives to traditional cigarettes] we have seen we can grow our market share even if the market reduces. Plus we’ve started introducing accessories for the product.
At over $100 for the starter kit, IQOS isn’t cheap. Can you explain your pricing strategy?
Calantzopoulos: Innovation, in the minds of people, cannot be something extremely cheap. If you are an average person and you hear that something that is much better than cigarettes comes to the market at the cheapest possible price, you’ll not trust it. This is the reason we didn’t initially manufacture in China, because you need to create that credibility.
Over time you need to make the products available and affordable to different categories of people.
The big shift
You redesigned your website recently to describe yourself as “committed to a smoke-free future” even though most of your business is still in traditional cigarettes. Why?
Calantzopoulos: We developed the website because we needed to make clear to our own stakeholders and employees here that this is the direction of the company.
This is not an easy thing, because we are entering into a territory that is very unknown. It’s not your traditional competitors.
Our industry has been a fairly linear and predictable industry. You know what’s going to happen every year. You know from time to time you are going to have a tax increase, you are going to have regulatory restriction, but, as it applies to everybody, I think we are doing very well.
But now you move to a model that from linear can become exponential for a period of time. It’s much more technology-driven, much more digital-driven. Competitors other than our traditional competitors can come in, whether legitimate or fly-by-night ones, and you have to anticipate all those things. We are the first ones to be in the category, so we anticipated quite a lot. We are learning every day. The whole organization has to gear up to this new reality and these new competitive rules around it.
There are still many regions of the world where you’re actively trying to grow revenues in your traditional cigarette business. How do you reconcile those actions with your mission statement of switching adult smokers to alternatives as quickly as possible?
Calantzopoulos: Shifting the company to these products doesn’t mean that I will give market share to my competitors free of charge. In the markets where we are not present with IQOS yet or the other reduced-risk products, you still need to defend your share of the market.
They still represent the bulk of our income, and so far they have financed the billions of dollars we have put behind these new products. But once we go national in a market, and absent capacity constraints, then you shift your resources and your focus to these new products.
But isn’t there an inherent contradiction here? Your new efforts are being funded by your traditional cigarette business, so it’s important that you keep that going.
Calantzopoulos: Take a market like Indonesia as an example. If I just take my foot off the pedal completely, nothing is going to happen to the total market except that I lose share.
The logic says you don’t do this until you go with IQOS.
We are focusing the organization much more on the new business. We will have very few new traditional product introductions, and as markets switch to IQOS we would remove resources [from the old business] completely.
Next year IQOS becomes profitable, so even the financing from these traditional businesses isn’t necessary anymore, because it becomes fully self-sustaining.
What should the regulatory environment look like for cigarettes and these new products?
Calantzopoulos: It’s pretty clear that we will need measures to accelerate the conversion to new products. Governments can either make measures even worse for cigarettes or do something different on these [new] products to show consumers they are different. I think they should do both.
I think over time the fiscal environment on cigarettes will become different, and the regulatory environment has to differentiate the products. If that is at the expense of cigarettes, so be it—it’s not a problem for me. But we need some logical forum where we don’t talk ideology but rather we talk about what can really accelerate the conversion. If you do display bans everywhere in the world on cigarettes but you can display IQOS, that’s a differentiating measure for me. Then I’m more than willing to accept these measures because they are really conducive to make people switch.
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Cenovus - >>> ConocoPhillips shares rally on sale of oil sands interest to Cenovus
By Wallace Witkowski
Mar 29, 2017
https://www.marketwatch.com/story/conocophillips-shares-rally-on-sale-of-oil-sands-interest-to-cenovus-2017-03-29?siteid=bigcharts&dist=bigcharts
ConocoPhillips COP, -1.01% shares rallied in the extended session Wednesday after the oil company agreed to sell its interest in an oil sands joint venture to Cenovus Energy Inc. CVE, -1.14% ConocoPhillips shares rallied 5.7% to $48.58, while Cenovus shares fell 8.3% to $12 after hours. Under the agreement, Cenovus will acquire ConocoPhillips's 50% stake in the FCCL Partnership, which is operated by Cenovus, for $17.7 billion, or $14.1 billion cash and 208 million Cenovus shares. The companies expect the deal to close in the second quarter.
<<<
>>> CEO says AT&T ‘prepared to litigate’ over Time Warner acquisition
By Drew FitzGerald and Brent Kendall
Nov 9, 2017
https://www.marketwatch.com/story/ceo-says-att-prepared-to-litigate-over-time-warner-acquisition-2017-11-09
Justice Department reportedly seeks major divesture
AT&T Inc.’s T, +0.65% chief executive said Thursday he is prepared to go to court to defend the telecom giant’s proposed takeover of Time Warner Inc. TWX, +4.08% if settlement discussions with antitrust regulators fail.
“We are prepared to litigate now” if the companies can’t reach a negotiated settlement with the Justice Department, AT&T CEO Randall Stephenson said at an industry conference Thursday.
Stephenson said the company would continue to pursue a settlement but was prepared to litigate if it determined that the conditions of such a deal were worse than the outcome of a courtroom fight.
After a long antitrust review, the Justice Department recently raised the prospect that the telecom giant would have to divest either the Turner television unit or the satellite DirecTV business, said people familiar with the matter.
<<<
>>> Duke Energy Corporation (Duke Energy) is an energy company. The Company operates through three segments: Electric Utilities and Infrastructure; Gas Utilities and Infrastructure, and Commercial Renewables. The Company operates in the United States through its direct and indirect subsidiaries. The Electric Utilities and Infrastructure segment provides retail electric service through the generation, transmission, distribution and sale of electricity to approximately 7.5 million customers within the Southeast and Midwest regions of the United States. The operations include electricity sold wholesale to municipalities, electric cooperative utilities and other load-serving entities. The Gas Utilities and Infrastructure segment serves residential, commercial, industrial and power generation natural gas customers. The Commercial Renewables primarily acquires, builds, develops and operates wind and solar renewable generation throughout the continental United States. <<<
>>> CSX Corporation is a transportation company. The Company provides rail-based freight transportation services, including traditional rail service and transport of intermodal containers and trailers, as well as other transportation services, such as rail-to-truck transfers and bulk commodity operations. The Company categorizes its products into three primary lines of business: merchandise, intermodal and coal. The Company's intermodal business links customers to railroads through trucks and terminals. The Company's merchandise business consists of shipments in markets, such as agricultural and food products, fertilizers, chemicals, automotive, metals and equipment, minerals and forest products. The Company's coal business transports domestic coal, coke and iron ore to electricity-generating power plants, steel manufacturers and industrial plants, as well as export coal to deep-water port facilities. <<<
>>> ConocoPhillips is an independent exploration and production company. The Company explores for, produces, transports and markets crude oil, bitumen, natural gas, liquefied natural gas (LNG) and natural gas liquids. The Company operates through five segments: Alaska, Lower 48, Canada, Europe and North Africa, Asia Pacific and Middle East, and Other International. The Alaska segment explores for, produces, transports and markets crude oil, natural gas liquids, natural gas and LNG. The Lower 48 segment consists of operations located in the United States Lower 48 states and the Gulf of Mexico. Its Canadian operations consists of oil sands developments in the Athabasca Region of northeastern Alberta. The Europe and North Africa segment consists of operations and exploration activities in Norway, the United Kingdom and Libya. The Asia Pacific and Middle East segment has exploration and production operations in China, Indonesia, Malaysia and Australia. <<<
>>> Cenovus Energy Inc is a Canada-based integrated oil company. It operates in the business of developing, producing and marketing crude oil, Natural Gas Liquids (NGLs) and natural gas in Canada. The Company also conducts marketing activities and owns refining interests in the United States (U.S.). Its segments include: Oil Sands, which includes the development and production of bitumen and natural gas in northeast Alberta; Conventional, which includes the development and production of conventional crude oil, NGLs and natural gas in Alberta and Saskatchewan, including the heavy oil assets at Pelican Lake, the carbon dioxide (CO2) enhanced oil recovery (EOR) project at Weyburn and emerging tight oil opportunities; Refining and Marketing, which includes transporting and selling crude oil and natural gas and joint ownership of refineries in the U.S., as well as Corporate and Eliminations. <<<
>>> AT&T Inc. is a holding company. The Company is a provider of communications and digital entertainment services in the United States and the world. The Company operates through four segments: Business Solutions, Entertainment Group, Consumer Mobility and International. The Company offers its services and products to consumers in the United States, Mexico and Latin America and to businesses and other providers of telecommunications services worldwide. It also owns and operates three regional TV sports networks, and retains non-controlling interests in another regional sports network and a network dedicated to game-related programming, as well as Internet interactive game playing. Its services and products include wireless communications, data/broadband and Internet services, digital video services, local and long-distance telephone services, telecommunications equipment, managed networking, and wholesale services. Its subsidiaries include AT&T Mobility and SKY Brasil Servicos Ltda. <<<
>>> Aqua America, Inc. is a holding company. The Company is engaged in providing water or wastewater services concentrated in Pennsylvania, Ohio, Texas, Illinois, North Carolina, New Jersey, Indiana and Virginia. The Company is the holding company for its primary subsidiary, Aqua Pennsylvania, Inc. Its market-based activities are conducted through Aqua Resources, Inc. (Aqua Resources) and Aqua Infrastructure, LLC (Aqua Infrastructure). Aqua Resources, Inc. provides water and wastewater service through operating and maintenance contracts with municipal authorities and other parties close to its utility companies' service territories, and offers, through a third party, water and sewer line repair service and protection solutions to households. Aqua Infrastructure provides non-utility raw water supply services for firms in the natural gas drilling industry. The Company owns several wastewater collection systems that convey the wastewater to a municipally-owned facility for treatment. <<<
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