Earnings Distortion Scorecard: Week of 4/27/20-5/1/20
For the week of 4/27/20-5/1/20, we focus on the Earnings Distortion Scores for 173 companies.
Matt Shuler, Investment Analyst II
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Matt Shuler, Investment Analyst II
United Technologies Overpaid for Rockwell Collins
Simply put, the price UTX will pay for this acquisition – which comes to ~$33 billion when accounting for all forms of debt and unfunded pension liabilities – makes it almost impossible for the deal to create long-term value for shareholders.
Sam McBride
3-Year Average Return on Invested Capital: Explanation & Examples
3-year average return on invested capital (seen in Figure 1) provides additional insights into a firm’s track record of prudent capital management.
Kyle Guske II, Senior Investment Analyst, MBA
GAAP-Based Return on Invested Capital: Explanation & Examples
GAAP-based ROIC is based on a simplified after-tax profit (NOPAT) and invested capital that can easily be calculated using only the income statement and balance sheet.
Kyle Guske II, Senior Investment Analyst, MBA
Salesforce.com Investors Lose Big In Demandware Acquisition
Under even the most optimistic integration scenarios, we believe that Salesforce.com’s proposed acquisition of Demandware for $75/share or $2.85 billion represents an unacceptable transfer of wealth from CRM to DWRE shareholders.
Kyle Guske II, Senior Investment Analyst, MBA
Price Target Update: Square Inc. (SQ)
Due to change in market mentality, and in light of the recent downturn in the market, we felt it time to revise our price target for Square Inc. (SQ)
Kyle Guske II, Senior Investment Analyst, MBA
The Market Values High ROIC Companies
Last month, Fortune released its list of the top 50 businesspeople of the year. The recognition these CEO’s are receiving shows that the market cares about ROIC, even if many investors aren’t explicitly talking about it.
Sam McBride
Danger Zone: Square, Inc. (SQ)
Recent IPO Square (SQ) is in the Danger Zone this week despite its noble cause of providing payment solutions for small to medium businesses because it checks many of the Danger Zone boxes: questionable non-GAAP accounting, non-competitive business models, and an extremely risky valuation.
Kyle Guske II, Senior Investment Analyst, MBA
The Truth About M&A: How To Measure True Value
In this special webinar, CEO David Trainer will walk you through how to determine whether or not a corporate acquisition is in your — the investor's — best interests.
David Trainer, Founder & CEO
Danger Zone: Utility Funds
Utility sector ETFs and mutual funds are in the Danger Zone this week.
David Trainer, Founder & CEO