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Healthcare ETFs Have More Room To Run

Summary The Healthcare sector could continue to perform this year. Fundamental factors continue to contribute to growth. Biotech is the leading sub-sector in the healthcare industry. The Healthcare sector exchange traded funds have been outpacing the broader markets and could remain healthy as rising profits diminish concerns over frothy valuations. Over the past year, the Health Care Select Sector SPDR ETF (NYSEARCA: XLV ) rose 25.2%, while the SPDR S&P 500 Trust ETF (NYSEARCA: SPY ) gained 17.1%. Year-to-date, XLV is up 2.5% and SPY is 0.6% higher. Specialized drug treatments, an aging population and industry-wide consolidation, among other factors, will continue to help healthcare stocks, reports Eric Platt for Financial Times . “More than any other sector, healthcare is benefiting from strong demographic and secular trends: aging population, expanding insurance coverage, growing middle-class around the world, new product launches,” Dubravko Lakos-Bujas, equity strategist with J.P. Morgan, said in the Financial Times article. Strong earnings results will support the healthcare sector ‘s rising prices. Healthcare companies reported organic growth of all sectors, including 11% revenue growth and 22% earnings growth over the fourth quarter. Looking ahead, S&P Capital IQ projects S&P 500 healthcare earnings per share to rise 8.9% in 2015 year-over-year, compared to a 1.7% gain in the broader blue-chip index. Barclays strategists also point out that the biotech sub-sector has been a significant contributing factor to earnings growth within the healthcare industry. Over the past year, the iShares Nasdaq Biotechnology ETF (NASDAQ: IBB ) rose 27.2% and the Market Vectors Biotech ETF (NYSEARCA: BBH ) increased 21.9%. The biotech sub-sector makes up 20.3% of XLV’s holdings. “Our conviction level is high on the industry given what we believe will be another strong year for biotech innovation and a differentiated earnings growth profile versus the broader markets,” Geoffrey Meacham, an analyst with Barclays, said in the Financial Times article. Moreover, merger and acquisition (M&A) activity will strengthen valuations. As the market anticipates more deals ahead , consolidations have provided a floor on share prices. Fueling further M&A activity, Marshall Gordon, senior healthcare analyst at ClearBridge Investments, argues that large companies still need to acquire more products, especially as large blockbuster drug patents expire, and financing remains inexpensive. Health Care Select Sector SPDR ETF (click to enlarge) Max Chen contributed to this article . Disclosure: The author is long SPY. (More…) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it. The author has no business relationship with any company whose stock is mentioned in this article.

Agribusiness ETFs: Commodity Slump Pressures Farmers

Summary Depressed commodity prices are hurting farmers. As farmers’ profits fall, the agribusiness industry could slow. Overview of current agriculture industry. Agribusiness exchange-traded funds could experience stunted growth as depressed grain prices squeeze farmers’ profit margins. Over the past year, the Market Vectors Agribusiness ETF (NYSEARCA: MOO ) rose 7.7% and the PowerShares Global Agriculture Portfolio ETF (NASDAQ: PAGG ) increased 7.6% higher. “U.S. farmers are beginning to cut back on farming equipment as the low crop prices and rising costs diminish income,” reports Alan Bjerga for Bloomberg . The U.S. government projects that farm income this year is heading toward the third consecutive decline and will post its largest fall since the Great Depression. Net-cash income from farm activity is expected to plunge 22% to $89.4 billion, the biggest drop off since 1932. For instance, Illinois grower Jason Lay stated that he will purchase 30% less fertilizer for 2,500 acres of corn and soybeans, 7% fewer seeds for spring planting and no new equipment, with crop futures now trading near a five-year low. “You spend when times are prosperous so you don’t need to when they’re not,” Lay said in the Bloomberg article. “That’s how you make it through.” Over the past year, the Teucrium Corn ETF (NYSEARCA: CORN ) has declined 17.0% and the Teucrium Soybean Fund (NYSEARCA: SOYB ) fell 14.1%. “The U.S. Department of Agriculture has predicted lower-than-expected U.S. corn stockpiles next year of 1.827 billion bushels, down from 1.877 billion, but raised its global stockpile projections to 189.6 million metric tons from 189.2 million,” reports Jesse Newman for the Wall Street Journal . “Combined grain supplies are substantial, and the market will not shift attention to the spring-planting progress and crop development across the Northern Hemisphere,” Jerry Gidel, the chief feed-grain analyst at Rice Dairy LLC, said in a Bloomberg article. Market Vectors Agribusiness (click to enlarge) Max Chen contributed to this article . Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More…) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it. The author has no business relationship with any company whose stock is mentioned in this article.

Hawaiian Electric Industries (HE) Q4 2014 Results – Earnings Call Webcast

The following audio is from a conference call that will begin on February 12, 2015 at 17:00 PM ET. The audio will stream live while the call is active, and can be replayed upon its completion. Are you Bullish or Bearish on ? Bullish Bearish Neutral Results for ( ) Thanks for sharing your thoughts. Submit & View Results Skip to results » Share this article with a colleague