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Bombardier_(TSX:BBD.B)_July_17_2018For those of you considering shorting Bombardier, I think there is still some upside left or atleast the time is not yet ripe to short the stock just yet. Granted, that based on historical performance (atleast the past 5 years) the stock has reached close to all time highs (since about 2012). Furthermore, the $5.00 mark seems to act as a key resistance level which the stock is having trouble breaching through. However, as traders we should focus more on logic and less on intuition for better overall portfolio performance. An analysis of the Moving Averages(MA) indicate the the stock is in a uptrend. The price is above the MA, the short MA has crossed the long MA and both MA have an upward trend. In addition, the Accumulation-Distribution (AD) also has an upward trend. With news that the partnership with Airbus has been formalised, their new line of business jets about to enter service and the train division doing well it would be unwise to short the stock until and unless the trends indicate otherwise. The greatest risk to the company is its large debt that will act as a huge burden in a rising interest rate environment. With relations souring between USA, Canada and Europe, BBD.B is going to receive additional support from the Canadian government. Also Canadian and European Airlines are going to be prodded by the government to buy more CSeries Aircraft rather than the competing Boeing 737's. With Airbus coming into the fold and marketing the CSeries as one of their aircraft (as it has been rumoured), Bombardier seems to be well positioned to sell more planes. How much of that profit is going to go to BBD.B is a question for another day. My prediction is that the stock is going through a period of consolidation. If you hold the stock then do not sell just yet but depending upon your risk profile you may want to determine a good exit point in case the stock price indeed goes south. If you are yet to buy the stock, this consolidation might be a good time to buy but you want to set your stop loss at a appropriate level so that you do not lose a huge portion of your capital.
TSX:BBD.B
by advisacorp
Deutsche_Bank_(NYSE:DB)_May_29_2018Deutsche Bank is one of the largest banks in the world by assets. Along with DB’s home market of Germany, it has a presence in more than 50 countries around the world stretching from the Americas (North and South), Asia-Pacific, Central /Eastern Europe, Middle East and Africa. The bank has three primary business segments: 1) Private & Commercial Banking 2) Asset Management 3) Corporate and Investment Banking Since 2014, the stock has been in a downtrend due to a variety of issues (As per Wikipedia, since 2016 the bank has been involved in some 7800 legal disputes). These controversies range from tax evasion, market rigging, money laundering and sanctions violations. However, I believe the price has dropped to levels that make it extremely attractive for long term value investors. Yes, there are certainly concerns of declining revenue, flight of key human resources and more potential fines; however if there is one lesson from history that stock investors should take note off is “Buy Low and Sell High”. The price has dropped below key support levels and reached all time lows. The 20 day and 50 day moving averages indicate a downtrend while the AD indicator indicates an uptrend which usually occurs when the trend is poised for a reversal. However, this should to be confirmed by price action. For contrarian investors, I believe this is an excellent price to buy into the stock. For more risk averse investors, you want to wait till there is a confirmation from the price action such as the price crosses the Moving Average and the slope of the average is positive.
NYSE:DB
by advisacorp
Corus_Entertainment_(TSX:CJR.B)_May_17_2018Corus is a Canadian Media company with interests in the radio, publishing, and television sectors. It was a part of Shaw Communication till 1999 when it was spinned off as a separate company. Since 2014, CJR.B has been in a state of decline owing to the rise of Netflix and other internet based media networks which has impacted advertising revenue. However, even though Television viewership is shrinking, it will not completely die out. There will always be customers for speciality television shows such as those that Corus Entertainment owns and operates. Radio was long presumed to be dead but has found a niche market; I believe television will find its own market. Currently, my analysis indicates that a symmetric triangle is developing. Volume is contracting as the price moves towards the peak of the triangle. Depending upon which way CJR.B breaks outs, we may want to buy or short the stock. However, at these prices CJR.B is yielding over 15% dividend. I think there is sufficient support for the stock around $6.00 as evident by the strong volume at that price level. Earnings are also above analyst estimates (the last earnings was). Based on the probabilities, I would take a gamble at the stock around $6 and hold it till the sector goes strong again. Even though the price may never reach the peak levels of 2014, a 15% dividend is not bad these days. Ofcourse the dividend can be reduced; which any sensible management would do. But in this case, the management seems extremely shareholder friendly with almost firm reassurance that the dividend will not be impacted.
TSX:CJR.B
by advisacorp
1
Blackberry_(NYSE:BB)_May_16_2018Since the demise of Nortel, Blackberry was the darling of the Canadian Tech Sector till about 2008. However, the rise of Apple combined with the Great Recession of 2008 caused the stock price of BB to drop from $130 to $40. Proliferation of touch screen phones running on Google's Android platform since then further contributed to the stock's decline. The stock was trading around the $9-10 range in 2016-2017. However there has been some recent interest in the company owing to its expertise in developing corporate security products and how those same technologies could be leveraged for the Internet of Things (IOT) world. Currently, the intermediate term trend is bullish; the short term trend is bearish. I think the chart pattern can be either classified as: 1) Descending Triangle 2) Symmetric Triangle The burden of proof leads me to believe that a descending triangle is more appropriate. I think by the next earnings call (later this month) we will know which way BB will break out. If the breakout is towards the positive side, I see the stock price trading in the $14 price range. If the breakout is negative, I see support around $10.25. Based on the last few earnings report, my guess will be that the stock will make a breakout in a bullish manner. however, I will wait a few more days to confirm the trend before buying in. Happy Trading!!!
NYSE:BB
by advisacorp
Exxon_(NYSE: XOM)_May_14_2018The Exxon stock suffered setbacks after the Q1 earnings report where it emerged that the revenue did not grow in line with rising oil prices. Furthermore, the debt burden was quite huge at over USD 30 billion. Compared to competitors such as Chevron, Royal Dutch Shell, BP, XOM was lagging in key metrics. This triggered a sell-off that brought the stock price to almost 2 year lows since oil prices crashed. Now the stock has surged past two key support/ resistance levels and there seems to be a bullish support underneath. However, if the oil price rally does not continue, I expect XOM to fall to $75-$80 trading range. On the other hand, if the oil price stays at current levels or move higher (which I doubt as the oil market itself has fundamentally changed; lot more focus on renewables and with shale oil, it is beneficial for the producers to just keep pumping more), I am confident that XOM will be soon staring at $90. I am bullish on XOM in the long term. In the near term, I would wait to see if the price holds up at the key support level before taking on a position around $79-80. I will also wait to confirm that the slope of the 200 day SMA turns positive. The 20 day SMA has crossed the 50 day SMA in a bullish manner. For the confirmation of a long term bullish trend all three SMA need to have a positive slope with the short term SMA crossing the long term SMA.
NYSE:XOMLong
by advisacorp
Facebook_(NASDAQ:FB)_May_13_2018Facebook has been one of the top performing stocks of 2017 and is part of the FANG group of companies that represent the best of the tech sector. Since the disclosure of the activities of Cambridge Analytica, the stock has taken some beating before finally finding the path to recovery. Currently, the stock is trading within a bullish channel pattern. However, I expect stock price to come down in the near term to about $180 levels. This is because the bounceback has been too severe and the initial heavy volume that was evident during the price drop from the Cambridge Analytica incident has been tapering off. As shown by MACD, the gap between the MACD and signal line is diverging which further lends to the burden of proof that a price drop may be coming. Any indication of price drop may result in some investors taking profits which may prompt even more investors to sell off their securities.
NASDAQ:META
by advisacorp
Google_(NASDAQ:GOOG)_May_11_2018Since the 2000's Google has always been a growth story. As individuals in this information age it is hard to imagine a life without GOOG. From searching up information to sharing photos, advertising to booking flights, google has become an indispensable part of our lives. Privacy concerns since the publication of Cambridge Analytica's activities dented the growth of the FANG stocks for a short while but the growth seems to be on track now. With the recent product demos involving AI and Machine Learning, I feel that Google is going be a lead player in most markets (if not by itself then through partnerships; such as the partnership with Walmart to prevent Amazon from cornering all the product search market). There will surely be competition, but Google has the first mover advantage. The current pattern seems to be that of an ascending triangle (which in general is a bullish pattern). However, I would wait till a breakout occurs before buying into it. If I want to take a really long position, I might buy when there is a slight pullback from the current levels where there is support from the hypotenuse of the ascending triangle. However, the risk is that the FANG stocks trade at incredible valuations (high P/E; an indication of their future earning potential). Any big shock to the market is going to send these crashing down till the market reaches some kind of equilibrium as evidenced by the Facebook and the Cambridge Analytica incident. Happy trading!!!
NASDAQ:GOOGLong
by advisacorp
Ford_(NYSE:F)_March_11_2018Ford along with GM and FCA are known as the big three and is synonymous with the American Automotive Industry. Since being founded by Henry Ford in the early 1900's Ford has lasted a century braving through the ups and downs of history. During the Great Recession of 2008, Ford was the only automaker to have not filed for bankruptcy, giving credence to their management team and strong leadership culture. However, since reaching a high of about $18 in 2013-2014, the stock price has been in a steady decline. Last year when the entire world economy was bullish, the Ford stock kept edging lower finally finding support around $10. Currently, it seems that the stock is experiencing some upside as confirmed by the bullish channel pattern that has formed over the last few months. The short moving average (50 day) is approaching the long moving average (200 day) in a bullish manner. However, the factory fire resulting in complete shutdown of the F150 production has dented the pattern somewhat. I think, Ford may be a long based on the current pattern. Although, I want to confirm that the support formed by the lower bound of the channel holds in the next few days. If that holds, the stock may rise upto $12 as indicated by the Fib Analysis. The coming few days will tell how good/ bad the situation is.
NYSE:FLong
by advisacorp
Enbridge_(TSX: ENB)_May_10_2018Enbridge is one of the largest energy infrastructure companies in North America. It operates in five segments: Liquids Pipelines, Gas Transmission and Midstream, Gas Distribution, Green Power and Transmission, and Energy Services. It's primary area of operations include Canada and the United States. The stock has treaded downwards since it announced the acquisition of Spectra Energy in 2016 resulting in a debt of close to $60 billion dollars. However, the company has started to sell several non-core assets for which the has received considerable interest from potential buyers. In the long run as oil and gas prices increase, Enbridge is surely going to benefit from the increase in prices. In the short to medium term, the price has cross the upper bound of the channel. Buyers interested in buying should wait till the stock pull back to the upper support of the channel and confirm that the support holds. However, I strongly believe that at these prices the stock is a steal compared to the assets and potential income from those assets.
TSX:ENBLong
by advisacorp
General_Electric_(NYSE:GE)_May_10_2018GE one of the finest companies representing Americal instrutrial prowess and technological marvel. However, in the last 52 weeks, the company's performance has be too poor to garner any positive mention. The bearish sentiment resulted primarily from GE Capital and GE Power. On the other hand, GE still has many crown jewels such as GE Aviation, GE HealthCare. My analysis indicates, the worst may be over for GE and as long as the management avoids short sighted decisions (that may boost profit now but will hurt outlook later). I think in the near term the price is expected to climb towards the $15-18 range. Long term however, I see GE as a $25+ stock. Although, the dividend has been cut and the cash flow does not look great (along with an underfunded pension plan), GE does have the potential to climb back up into the SP500's top performers. GE has always been an innovator. As long as that culture is imbued within the employees and managements takes steps to retain key employees, I see the outlook as very positive. The worst case scenario for GE would be another recession as the demand for industrial products can drop significantly leading to lower revenues. However, I think at this point, it is an excellent opportunity to buy into GE.
NYSE:GELong
by advisacorp
Hydro_One_(TSX:H)_May_09_2018Hydro One is an electricity transmission and distribution utility serving the Canadian province of Ontario. Currently, Hydro One is trading at historic lows since its IPO. The underlying trend is bearish, while the chart pattern is Broadening Bottom. At this point the price can go either way. Currently, the support is being tested at the trendline (Dividend is around 4.4%). If price drops further (below CAD $20, then the probability that the price may go down further increases. However, if price does not drop further within the next few days, this is an excellent entry point as the probability of a price rise after an broadening bottom with an underlying bearish trend is over 50%. The elections in Ontario (to be held in June) will be a critical factor in determining the mid to long term outlook for the stock. Currently, all parties (political) do not want the price of electricity to go up (the government is a large shareholder of the utility). However, after the elections these poll pledges might disappear as energy prices across all sectors tend to rise (especially during the summer months).
TSX:H
by advisacorp
1
Bombardier (TSX: BBD.B)_May_08_2018Bombardier has had an excellent run since the stock reached all time lows of close to CAD$ 0.65 in 2016. Currently, the stock has move either way depending on key market conditions. BBD has quite the large debt (close to $9 Billion). The news of the CSeries partnership with Airbus, their upcoming Business Jet, excellent sales on the transportation sector and sale of underutilised assets has generated considerable buzz and increased confidence in the company and leadership team. However, the coming few weeks/months will be crucial as the sale of the CSeries to Airbus is supposed to clear all regulatory hurdles this year; as well as their new business jet the Global 7000 is getting certified this year; the transportation sector is also expecting new orders esp. in BBD's home state of Quebec. If these events go smoothly, the stock might push the CAD 5-6. On the other hand, if the CSeries deal emerges as a freebie to Airbus and there is delay in the business jet entry into service coupled with any renewed tensions from the US in regards to NAFTA, the stock might fell back in the CAD$ 2-3 price range.
TSX:BBD.B
by advisacorp
Johnson & Johnson (NYSE: JNJ)_May_08_2018JNJ has had a good run since the beginning of 2017. Although, the stock price has dropped from a high of $148 to $122, I think reality is catching up with investors that equity valuations have been quite expensive and that it is time for some correction. I believe the fundamentals of the company remain strong although the liabilities with rising interest rates may be a cause for concern. I believe the current scenario presents an opportunity to short the stock. Based on the head the shoulder pattern, the price is expected to drop to $110-$115 range.
NYSE:JNJShort
by advisacorp
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