Tag Archives: apple

Apple iPhone Encryption Fight With Feds Enters New Phase

Apple ’s ( AAPL ) fight with the federal government over the encryption software on its iPhones only took a short pause after the Justice Department backed down in the San Bernardino, Calif., shooter case. Apple is facing renewed challenges on the issue from several fronts. The Justice Department on Friday said it will continue to seek a court order to require Apple to help it access data from a locked iPhone seized in a New York drug investigation, the Wall Street Journal reported . A judge in the Brooklyn drug case had previously refused to force Apple to help open the iPhone. That case had been overshadowed by the San Bernardino terrorist probe. On March 28, federal prosecutors withdrew their demand that Apple help it hack an iPhone 5C belonging to deceased killer Syed Farook, saying it had found a way to unlock the phone using a third party. But that solution only works on older iPhones, FBI Director James Comey said Wednesday, NBC News reported . Federal law enforcement officials reportedly have at least a dozen criminal investigations in which they are trying to get Apple to unlock iPhones. Apple CEO Tim Cook has maintained that government demands for it to hack its iPhone software would set a dangerous precedent. If Apple is forced to write software to get around its security, it would be creating a back door that criminals, hackers and spies could exploit, he said. That would jeopardize the privacy and security of the personal and financial data on millions of iPhones, Cook said. Meanwhile, Sens. Richard Burr, R-N.C., and Dianne Feinstein, D-Calif., are preparing legislation titled the “Compliance With Court Orders Act of 2016.” As drafted, the legislation would require any individual or company to comply with any U.S. court order and hand over data to authorities, including data that is encrypted or made “unintelligible” by other means. Gaurav Laroia, policy counsel with the Free Press Action Fund, called the proposed bill a “massive overreach” by the government. It “would undermine any technology that helps secure people’s private communications,” he said in a statement. Burr and Feinstein “have forgotten the rights guaranteed to Americans under the Constitution,” Laroia said. Daniel Castro, vice president of the Information Technology and Innovation Foundation, also slammed the proposed bill. He said the bill would force companies to create workarounds for their software, even when it is the customer who controls the encryption keys.

AT&T, Verizon Wireless Q1 Margin Boost Might Last Until iPhone 7

Wireless profit margins at AT&T ( T ) and Verizon Communications ( VZ ) should improve when they report first-quarter earnings — owing to fewer customers upgrading to new smartphones — a trend that might continue until Apple ( AAPL ) rolls out its iPhone 7 in the fall. The improving wireless margins at Verizon and AT&T has its roots in financing plans with monthly installment payments and accounting methods. Michael Rollins, an analyst at Citigroup, says upgrade rates are falling as wireless customers hang onto devices longer. “The longer device embrace by customers should help carrier financials for the first quarter,” Rollins said in a research report Friday. Apple’s iPhone 6S refresh was only a “marginal improvement” over the earlier iPhone 6, but the iPhone 7 should be different, Rollins says. “The iPhone 7 could lead to another industrywide upgrade cycle, as has been seen by each new ‘number’ of iPhone, and we await more details about the innovations it will contain,” he wrote. “Even with faster device sales in Q4, we are starting to see signs that the device cycle could eventually extend to 27 to 30 months, up from more traditional pacing of 24-26 months back in 2014-2015.” Jefferies analyst Mike McCormack has a similar view. “We expect lower volumes as upgrades hit record lows, supporting stronger industry margins,” McCormack said in a research note Thursday. “We expect this theme to prevail going forward, at least until the iPhone 7 launch this fall. We see opportunity for margin outperformance at both AT&T and Verizon, and continued positive momentum at T-Mobile US ( TMUS ).” Verizon kicks off the telecom Q1 earnings season on April 21, followed by AT&T on April 26. UBS analyst John Hodulik was ahead of the pack with a report out March 18. “The move to installment sales for handsets has been a big driver of improved industry profitability given the accounting treatment,” wrote Hodulik. “However, installment plans are also having more tangible effects on the industry by lengthening upgrade cycles for postpaid phones. “This is putting pressure on upgrade rates, which is in turn driving lower churn and fewer gross adds. We believe this will be a key theme for Q1 earnings, driving another quarter of strong sector profitability, especially at AT&T and Verizon.” Shares of both AT&T and Verizon were up a fraction in afternoon trading in the stock market today .

3 Healthcare Funds To Buy On Biotech Rebound

After being beaten down during the first three months of the year, biotech stocks made a remarkable rebound over the past few days. Though the iShares Nasdaq Biotechnology ETF (NASDAQ: IBB ) is still down 17% in the year-to-date frame, it posted an increase of 5.9% on Wednesday, witnessing the best percentage gain since March 12, 2009. In fact, the 7.9% rise in IBB over the past one-month period also propelled healthcare mutual funds, which gained 2.9% during the same period. Mutual funds from this category may be profitable for investors, who are looking to gain from this encouraging trend. Reasons for the Recent Surge Strong gains of 5% and 3.5% respectively in Pfizer Inc. (NYSE: PFE ) and Allergan plc (NYSE: AGN ) played an important role in lifting biotech stocks on Wednesday. The increase was prompted when the companies mutually called off their merger after tougher tax inversion rules were imposed by the U.S. Treasury Department and Internal Revenue Service. Leaving the deal behind, Allergan CEO Brent Saunders said that the company, “could act immediately if” it gets “the right opportunity with the right growth profile and the right strategic logic.” Meanwhile, it is now speculated that names of other UK-based firms like GlaxoSmithKline plc (NYSE: GSK ) are on Pfizer’s radar. Moreover, a surge of nearly 17% in shares of Edwards Lifesciences Corp. (NYSE: EW ) gave a boost to this sector. According to the company, data from the trial revealed that a procedure which uses its SAPIEN 3 valve shows better results than open heart procedures for certain patients. What’s Ahead? In spite of the recent surge, some of the concerns that affected the performance of biotech stocks at the start of 2016 may continue to impact the sector in the near future. Calls for reducing the prices of several drugs had played an important role in dragging down the sector. Hillary Clinton’s comments on the prohibitive pricing of certain medications drew much attention last year, weighing down on the sector’s stocks. Moreover, the U.S. Treasury Department’s adaptation of new rules to contain inversion-related deals may lower the volume of overseas merger and acquisition deals in the near term. Moreover, mixed earnings results during the fourth quarter affected the sector to quite an extent. Also, continued decline in the first-quarter earnings forecast is likely to hurt the sector’s performance in the days ahead. First-quarter earnings from the healthcare sector are anticipated to grow only 0.6% from the year-ago level compared with 9.3% growth witnessed in the previous quarter. Moreover, the year-on-year revenue growth rate is projected to decline to 8.8%, lower than the fourth quarter’s growth pace of 9.7%. However, an innovative product pipeline, product approvals and impressive performances by key products may act as growth catalysts and help the sector to overcome the above-mentioned concerns. Moreover, favorable valuation can make smaller companies within the sector attractive bets for acquisition. Separately, positive results from clinical trials also lift the sector’s stocks. They are difficult to predict, but come as welcome surprises for investors. 3 Healthcare Funds Picks Given this strong recovery, we have highlighted three healthcare mutual funds that either have a Zacks Mutual Fund Rank #1 (Strong Buy) or #2 (Buy). We expect these funds to outperform their peers in the future. Remember, the goal of the Zacks Mutual Fund Rank is to guide investors to identify potential winners and losers. Unlike most of the fund-rating systems, the Zacks Mutual Fund Rank is not just focused on past performance, but also on the likely future success of the fund. These funds have encouraging one-month and three-year annualized returns. The minimum initial investment is within $5000. Also, these funds have a low expense ratio and no sales load. Delaware Healthcare Fund I (MUTF: DLHIX ) invests a large chunk of its assets in equity securities of companies that are engaged in operations such as production, development and of products and services related to healthcare sector. DLHIX is a non-diversified fund. Along with a Zacks Mutual Fund Rank #1, DLHIX has one-month and three-year annualized returns of 5.9% and 16.8%, respectively. Annual expense ratio of 1.11% is lower than the category average of 1.35%. Fidelity Select Biotechnology Portfolio (MUTF: FBIOX ) seeks growth of capital. FBIOX invests the lion’s share of its assets in companies primarily involved in the research, development, manufacture, and distribution of various biotechnological products. The fund invests in securities of companies throughout the globe. Along with a Zacks Mutual Fund Rank #2, FBIOX has one-month and three-year annualized returns of 5.1% and 16.8%, respectively. Annual expense ratio of 0.72% is lower than the category average of 1.35%. Live Oak Health Sciences Fund (MUTF: LOGSX ) invests the majority of its assets in common stocks of healthcare companies or those related to medicine and life sciences. Though LOGSX primarily focuses on acquiring domestic securities, it may allocate a small portion of its assets in securities of foreign firms and ADRs. Along with a Zacks Mutual Fund Rank #2, LOGSX has one-month and three-year annualized returns of 3.9% and 15.9%, respectively. Annual expense ratio of 1.08% is lower than the category average of 1.35%. Link to the original post on Zacks.com