Nasdaq News

By Julia Malacoff

With the positive direction of the U.S. economy, growth and profit expectations will continue to trend higher as evidenced by the positive earnings results we have witnessed thus far. Here are this week’s stocks to keep an eye on

Saving for retirement is one of the most important things you can do with your money. Unfortunately, most Americans don't think they're doing it very well. In fact, according to a recent TD Ameritrade study, the majority of Americans would give themselves a grade of C or lower o

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Over the past few years, Meritage Homes (NYSE: MTH) has gradually shifted its focus away from "move-up" homes, and made entry-level housing its biggest business. This was a bold step by the company, already a top-10 homebuilder at the time, to shift away from a business model

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I consider myself to be a reasonably consistent saver. I regularly fund my retirement plan, and I generally make sure I have at least six months of living expenses in my savings account so I'm covered in the face of emergencies.

We are already in February and the New Year’s resolutions made back at the start of last month are but a distant memory. Often topping the list of pledges to oneself at the start of each year is the promise to cut down on the bad stuff and get into shape. An oft neglected activity, though, once the daily routine kicks back in again.

Consumers, though, are increasingly aware of the benefits of a healthy lifestyle, and the trend has spawned a whole industry catering to the fitness minded public.

With this in mind (and body), we thought we’d investigate further. Using TipRanks’ Stock Comparison tool, we’ve lined up two fitness focused stocks side by side on the treadmill, to take a closer look at why some on the Street believe these two are compelling buys right now. Let’s jump right in.

Peloton Interactive (PTON)

One of 2019’s high profile IPOs, Peloton caused quite a stir when going public last September; the stationary bicycle company was valued at $8.1 billion on its first day of trading. By the second, it had shed $1 billion of its value, making the company’s trading debut one of the worst of the decade. Peloton dusted itself off, got back on the bike and finished off the year on a more positive note, back to roughly its original IPO price.

The company, though, is drawing negative sentiment again this week, following the release of its FQ2 2020 earnings report. Peloton posted revenue of $466.3 million, a year-over-year increase of 77%, and handily beating the estimate of $423.7 million. Net loss per share of $0.20 topped the Street’s $0.30 call, too. Estimates which called for 688,800 connected fitness subscribers were left in the dust by the figure of 712,005 – a 96% year-over-year gain.

Despite the positive print, following the earnings call, PTON shares were sent tumbling down by over 7% due to soft guidance for the next quarter. For Q3, Peloton expects revenue of between $470 million and $480 million, less than the Street’s call of $494 million.

With a 94% customer retention rate, though, Stifel’s Scott Devitt remains bullish on the bike maker. Devitt points out that the lower Q3 revenue guide was caused by shorter than expected delivery times, which shifted 6,000 Connected Fitness subscribers into Q2 from Q3. The 5-star analyst believes a higher total second half is implied in the company’s updated outlook. Peloton’s investments in content development and new markets, in addition to its ability to drive engagement with new and existing product offerings, are further encouraging signs.

What does it all mean, then? It means the 5-star analyst’s rating remains the same, a Buy, but the price target changes gear, up from $37 to $38. The new figure implies upside potential of 36%. (To watch Devitt’s track record, click here)

The Street is up for the ride, too. 17 Buys and 2 Holds add up to a Strong Buy consensus rating. At $36.94, the average price target suggests possible upside of 33%. (See Peloton stock-price forecast on TipRanks)

Planet Fitness (PLNT)

Planet Fitness’ ‘everyone is welcome’ strategy is paying off. The affordable gyms and “judgement free” atmosphere they generate has seen the company provide handsome returns to investors. Over the last five years, PLNT’s share price has increased by 427%.

Looking at the business’ growth, it’s no wonder investors have been impressed. Totaling over 14 million members, in 2019, the gym franchise added another 261 locations, a 15%-unit growth. The final day of the year saw the opening of its 2000th location in Colorado Springs. PLNT intends to open an additional 1,000 in the next five years, with its sights set on adding the 80% of people over the age of 14 in the US and Canada without a gym membership. The expansion is not limited to North America, either; Planet has just opened its first two locations in Australia. According to the company, a minimum of 35 new additions down under should be expected over the next several years.

Macquarie’s Paul Golding believes that relative to its peers, Planet Fitness stock is "substantially undervalued". Given the company’s annualized growth rate, the 4-star analyst thinks PLNT’s low price-point is appealing and its focus on the US market positions it "defensively". In addition, PLNT’s penetration rates are rising, with an increasing gym count and further potential runway for comp reacceleration.

Therefore, Golding kept his Outperform rating and $90 price target as is. This conveys the analyst’s belief PLNT will add a further 9% over the next year. (To watch Golding’s track record, click here)

The Street takes a break from the workout and nods in agreement. PLNT’s Strong Buy consensus rating breaks down into a unanimous 5 Buys. The average price target comes in at $86.80 and suggests possible gains in the shape of 5%. (See Planet Fitness price targets and analyst ratings on TipRanks)

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.

Putting together a strong portfolio is more an art than a science. You have to balance share appreciation, potential upside, fundamental strength, and dividend yield to find the stock that will meet your needs. Do you want your investments to pay for themselves right away, or do you prefer a steady long-term gain? These are just a few of the factors to consider.

It’s complicated by the sheer size of the stock markets. TipRanks tracks data on over 6,500 publicly traded stocks – and that’s just the tip of the iceberg. Fortunately, the Stock Screener tool makes it easy to find the right investment. Set the filters to sort out the stocks with a “Strong Buy” consensus rating, add in ‘very high’ dividend yields, above 5%, and you’ll get the list down to only a handful of names. Here are three of them that may be worth your attention.

Enterprise Products Partners LP (EPD)

The oil and gas midstream sector – that is, the companies that move the product between the wellheads, storage farms, terminals, and the customers – is a profitable niche. The companies here control pipelines, railroad assets, river barges, terminals, and storage tanks, as well as make it possible to move fossil fuels. Enterprise Products owns and operates 50,000 miles of such pipelines, and controls storage capacity for 160 million barrels of oil and 14 billion cubic feet of natural gas. Enterprise also holds import/export terminal facilities on the Gulf Coast of Texas.

Low prices for oil and gas in 2019 hurt the company’s bottom line last year, but EPD appears to be holding up well. Even though the Q3 numbers missed the estimates, Q4, reported last week, was strong. Revenue came in above the forecast, at $8.01 billion, while the EPS of 54 cents was in-line with expectations. Both numbers are down year-over-year but up sequentially.

Enterprise is committed to sharing profits with investors, and pays out a regular – and reliable – dividend. With a yield of 7%, the dividend provides a return more than three times higher than the S&P 500 average, while the 81% payout ratio indicates that it is sustainable for the company. EPD’s history of dividend reliability goes back over 10 years.

5-star analyst TJ Schultz, of RBC Capital, sees EPD as a solid choice for investors. He writes, “EPD offers investors broad exposure to a full spectrum of the midstream value chains for NGLs and, increasingly, crude and petrochemical products. Furthermore, the partnership's multi-year organic growth backlog helps provide visibility on long-term distribution growth. EPD has grown and should continue to grow its fee-based cash flows as announced projects enter service and ramp.”

Schultz puts a $36 price target on EPD, implying an impressive upside potential of 41%, to back up his Buy rating on the stock. (To watch Schultz’s track record, click here)

Overall, EPD gets a Strong Buy from the analyst consensus, and that rating is unanimous. The stock has received 7 buy ratings in recent weeks. Shares are a bargain considering the high yield, priced at $25.56. The average price target of $34.50 suggests room for an upside of 35%. (See Enterprise Products stock analysis on TipRanks)

Kimbell Royalty Partners LP (KRP)

Kimbell Royalty is another player in the Texas oil boom, operating at the source. Kimbell owns oil and gas operations in 28 states, with major exploration, drilling, and extraction activity in the Permian Basin and Eagle Ford areas of Texas, North Dakota’s Bakken formation, and across Appalachia. Kimbell’s largest area of activity, which includes 43% of the company’s active wells, is in the Permian Basin of Texas.

Where Enterprise, above, saw a tough time in 2H19, Kimbell posted record high revenue in Q3 of that year. The top line came in with a 79% year-over-year gain, to $33 million. In addition to high revenues, KRP was able to acquire two competing companies, Haymaker and Phillips, during the reporting period.

Even better for investors, KRP has been using its positive cash flow generation to maintain a strong dividend. The company’s quarterly payment, 38 cents, annualizes to $1.52, for an impressive yield of 11.1%. That’s more than five times the average yield among S&P listed companies, and is powerful incentive for investors.

Looking at Kimbell for KeyBanc, analyst Leo Mariani was impressed enough by the company’s performance to initiate coverage with a Buy rating. He cites, “…anticipated dividend increases in 2020 and the recent pullback in the shares…” as reasons to enter this stock.

Mariani gives KRP an $18 price target to back the Buy rating, seeing room for 31% share growth here. (To watch Mariani’s track record, click here)

The Strong Buy consensus view on KRP shares is bolstered by 8 recent reviews, including 7 Buys and 1 Hold. The stock sells for just $13.70, and the average price target of $20.14 suggests an upside potential of 47%. (See Kimbell stock analysis on TipRanks)

New Mountain Finance Corporation (NMFC)

The energy industry isn’t the only place to find great dividend yields. Investment management companies, which control and administer private and corporate investment portfolios for profit, by nature generate a high cash flow. New Mountain uses its cash flow to maintain a dividend, returning profits to investors.

The dividend here is definitely worth talking about. NMFC pays out 34 cents per quarter, and has done so consistently since 2013. This gives a yield of 9.6% and an annualized payment of $1.36. The payout ratio is 98%, indicating that New Mountain returns all of its profits to investors – as expected, in an investment management company.

Like Kimbell, above, New Mountain has attracted a new analyst thanks to its solid financial performance. Derek Hewett, from Merrill Lynch, writes in support of his Buy rating, “We see an attractive dividend yield, and believe New Mountain is well positioned to capitalize on a supply/demand imbalance in the unrated middle market.”

Hewett’s price target, $14.50, suggests a modest upside of 2% in a stock that has already shown 4% appreciation so far this year. (To watch Hewett’s track record, click here)

With 3 recent Buy reviews, NMFC’s Strong Buy analyst consensus rating is unanimous. The stock offers a low cost of entry, at $14.23, and the average price target of $14.58 implies room for another 2.5% growth. The real benefit here is the dividend return. (See New Mountain stock analysis on TipRanks)

FXEmpire.com - The U.S. Dollar surged against a basket of major currencies on Friday, putting it within striking distance of its October 1, 2019 main top at 98.735. The catalysts driving the greenback higher were safe-haven demand due to concerns over the economic impact of the

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