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Dow Jones Crashes 1,000 Points But Warren Buffett Says Don’t Panic – CCN.com

Published

5 years ago

February 24, 2020

The Dow Jones nosedived Monday, but investors who are willing to take a risk could use this dip to nab value stocks.
Warren Buffett reminded investors not to panic over the weekend as coronavirus spread throughout Italy.
While the virus is likely to dent global growth, the impact is still likely to be temporary

It seems the U.S. stock market has finally started to panic about the coronavirus after weeks of shrugging off its growing severity. The Dow Jones lost 2% last week and this week looks likely to bring on more of the same after coronavirus cases in Italy skyrocketed over the weekend.

In a bull market that’s been stretching on as long as this one, a sell-off is a terrible thing to waste. At least, that’s what famed investor Warren Buffett alluded to over the weekend.

The Oracle of Omaha has been under-fire for sitting on a $128 billion cash horde through 2019, but we might see his investment company Berkshire Hathaway (NYSE:BRK) start taking up positions. Buffett is known for seeking out valuable companies whose long-term growth stories are being undervalued by the broader market.

Don’t let the Dow’s decline scare you; according to Warren Buffett, investors should stay the course. | Image: Johannes EISELE / AFP

Over the weekend as Dow futures continued to tumble, Buffett told CNBC that coronavirus isn’t a reason to panic despite its worrying spread:

Has the 10-year or 20-year outlook for American businesses changed in the last 24 or 48 hours? You’ll notice many of the businesses we partially own, American Express, Coca-Cola — those are businesses and you don’t buy or sell your business based on today’s headlines. If it gives you a chance to buy something you like and you can buy it even cheaper then it’s your good luck.

Of course, increasing your stake in equity holdings right now is risky— there’s still no telling exactly how much of an impact the coronavirus is going to have on the global economy. But most agree that as it stands now, the damage will be short-term.

As Federated Investors portfolio manager Steve Chiavarone put it,

We view this as headline risk. Our base case view is that coronavirus continues to represent demand delayed and not demand destroyed.

The Dow Jones is nose-diving, but that could make for a buying opportunity if you’re brave. |Source: Yahoo Finance

Plus, China appears to be over the worst of the virus as the daily number of new cases has finally dropped below the daily number of recovered patients.

With the Dow starting the week down 3.6%, it seems there’s plenty of good luck to be had. Here’s a look at some of the best bargains to buy as the stock market comes back down to earth.

Energy Stock: Valero Energy (NYSE:VLO)

While the oil and gas sector is likely to see continued volatility over the next year, there’s a compelling argument to start building a position in the industry. Not only can investors find some of the best dividend players on the market in the oil and gas sector, but it looks like coronavirus worries could be rock-bottom for the industry.

Valero makes a great play in the energy space due to it’s willingness to reward shareholders. | Source: Yahoo Finance

Valero makes for a good pick because management’s focus on capital discipline has kept free cash flow healthy. The firm is shareholder friendly with a goal of returning beset 40% and 50% of its operating cash flow to investors. At the end of January management raised Valero stock’s dividend payments and the firm offers a juicy yield of 4.73%.

Tech Stock: Qualcomm (NASDAQ:QCOM)

Another great value play that has seen its share price discounted in the wake of coronavirus is chipmaker Qualcomm. Qualcomm stock has lost 5% over the past week after management warned that coronavirus will likely dent future earnings as demand for smartphones in China wanes.

Coronavirus will likely hurt Qualcomm’s earnings, but that’s already been priced in. | Source: Yahoo Finance

That’s definitely worth considering from a risk standpoint, but the coronavirus impact is likely fully priced in to QCOM shares at this point. Management was cautious in their guidance, meaning they’re probably using a wort-case scenario model.

This could be a great buying opportunity for long-term investors as Qualcomm looks set to capitalize on the shift toward 5G networks. Once coronavirus fears start to subside, investors likely won’t get another opportunity to buy a growth play like Qualcomm at such a deep discount.

Dow Stock: Caterpillar (NYSE:CAT)

Caterpillar is the world’s largest construction equipment maker, so the firm tends to be a winner during periods of economic growth. CAT stock has dropped 12% since the start of the year as trade war concerns and coronavirus fears weigh on investor sentiment. Weak EPS guidance for 2020 coupled with worries about economic growth have hit Caterpillar stock hard.

Caterpillar stock has been plunging on recession fears, but if they’re unfounded investors could be in the money. | Source: Yahoo Finance

Still, that could make for a great buying opportunity if you’ve got time to wait out the turbulence. Caterpillar stock’s current slump suggests we could be heading for a recession—something most analysts agree is unlikely. If a recession doesn’t materialize, Caterpillar could deliver gains of around 20% this year.

As of this writing, Laura Hoy did not hold a position in any of the aforementioned securities. The above should not be considered trading advice from CCN.com. The opinions expressed in this article do not necessarily reflect the views of CCN.com.

This article was edited by Sam Bourgi.

Last modified: February 24, 2020 9:23 PM UTC

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What Difference Will You Make to an Employer?

Published

18 hours ago

October 21, 2024

Nick Kossovan

It’s common knowledge that companies don’t hire the most qualified candidates. Employers hire the person they believe will deliver the best value in exchange for their payroll cost.

Since most job seekers know the above, I’m surprised that so few mention their Employee Value Proposition (EVP). Most job seekers list their education, skills, and experience without substantiating them and expect employers to determine whether they can benefit their company; hence, most resumes and LinkedIn profiles are just a list of opinions—borderline platitudes—that are meaningless and, therefore, have no value. Job seekers need to better explain, along with providing evidence, how they’ll contribute to an employer’s success.

Employers don’t hire opinions (read: talk is cheap); they hire results.

You’re not offering anything tangible when you claim:

I’m a great communicator.
I’m detail oriented.
I’m a team player.

Tangible:

“At Global Dynamics, I held quarterly town hall meetings with my 22 sales reps, highlighting our accomplishments, identifying opportunity areas, and recognizing outstanding performers.”
“For eight years, I managed Vandelay Industries IT department, overseeing a staff of 18 and a 12-million-dollar budget while coordinating cross-specialty projects. My strong attention to detail is why I never exceeded budget.”
“While working at Cyberdyne Systems, I was part of the customer service team, consisting of nine of us, striving to improve our response time. Through collaboration and sharing of best practices, we reduced our average response time from 48 to 12 business hours, resulting in a 35% improvement in customer feedback ratings.”

These examples of tangible answers provide employers with what they most want to hear from candidates but rarely do; what value the candidate will bring to the company. Typically, job seekers present their skills, experience, and unsubstantiated opinions and expect recruiters and employers to figure out their value, which is a lazy practice.

Getting hired isn’t based on “I have an MBA in Marketing and Sales,” “I’ve been a web designer for over 15 years,” “I’m young, beautiful and energetic,” blah, blah, blah. Likewise, being rejected isn’t based on “I’m overqualified,” “I’m too old,” “I don’t have enough education,” blah, blah, blah. Getting hired depends entirely on showing employers that you can add value and substance to their company; that you’ll serve a purpose.

When you articulate a solid value offer, the “blah, blah, blah” doesn’t matter. Job seekers focus too much on the “blah, blah, blah,” and when not hired, they say, “It’s not me, it’s…” The biggest mistake I see job seekers make is focusing on the “blah, blah, blah”—their experience and education—believing this is what interests employers. Hiring managers are more interested in whether you can solve the problems the position exists to solve than in your education and experience.

Not impressive: Education

Impressive: A track record of achieving tangible results.

You aren’t who you say you are; you are what you do.

If you want to be somebody who works hard, you have to actually work hard. If you want to be somebody who goes to the gym, you actually have to go to the gym. If you want to be a good friend, spouse, or colleague, you have to actually be a good friend, spouse, or colleague. Actions build reputations, not words.

The biggest challenge job seekers face today is differentiating themselves. To stand out and be memorable, don’t be like most job seekers, someone who’s all talk and no action. Any recruiter or hiring manager will tell you that the job market is heavily populated with job seekers who talk themselves up, talk a “good game” about everything they can “supposedly” do, drop names, etc., but have nothing to show for it.

More than ever, employers want to hear candidates offer a value proposition summarizing what value they bring. If you’re looking for a low-hanging fruit method to differentiate yourself, do what job seekers hardly ever do and make a hard-to-ignore value proposition.

Increase sales: “Based on my experience managing Regina and Saskatoon for PharmaKorp, I’m confident that I can increase BioGen’s sales by no less than 25% in Winnipeg and the surrounding area by the end of 2025.”
Reduce cost: “During my 12 years as Taco Town’s head of purchasing, I renegotiated contracts with key suppliers, resulting in 15% cost savings, saving the company over $450,000 annually. I know I can do the same for The Pasta House.”
Increase customer satisfaction:“During my time at Globex Corporation, I established a systematic feedback mechanism that enabled customers to share their experiences. This led to targeted improvements, increasing our Net Promoter Score by 15 points. I can increase Dunder Mifflin’s net promoter score.”
Save time: “As Zap Delivery’s dispatcher, I implemented advanced routing software that analyzed traffic patterns, reducing average delivery times by 20%. My implementation of this software at Froggy’s Delivery can reduce your delivery times by at least 20%, if not more.”

If you want to achieve job search success as soon as possible, structure your job search with a single thread that’s evident and consistent throughout your résumé, LinkedIn profile, cover letters and especially during interviews; clearly convey what difference you’ll make to the employer.

_____________________________________________________________________

Nick Kossovan, a well-seasoned veteran of the corporate landscape, offers “unsweetened” job search advice. You can send Nick your questions to artoffindingwork@gmail.com.

Business

Netflix’s subscriber growth slows as gains from password-sharing crackdown subside

Published

5 days ago

October 17, 2024

Anne Joseph

Netflix on Thursday reported that its subscriber growth slowed dramatically during the summer, a sign the huge gains from the video-streaming service’s crackdown on freeloading viewers is tapering off.

The 5.1 million subscribers that Netflix added during the July-September period represented a 42% decline from the total gained during the same time last year. Even so, the company’s revenue and profit rose at a faster pace than analysts had projected, according to FactSet Research.

Netflix ended September with 282.7 million worldwide subscribers — far more than any other streaming service.

The Los Gatos, California, company earned $2.36 billion, or $5.40 per share, a 41% increase from the same time last year. Revenue climbed 15% from a year ago to $9.82 billion. Netflix management predicted the company’s revenue will rise at the same 15% year-over-year pace during the October-December period, slightly than better than analysts have been expecting.

The strong financial performance in the past quarter coupled with the upbeat forecast eclipsed any worries about slowing subscriber growth. Netflix’s stock price surged nearly 4% in extended trading after the numbers came out, building upon a more than 40% increase in the company’s shares so far this year.

The past quarter’s subscriber gains were the lowest posted in any three-month period since the beginning of last year. That drop-off indicates Netflix is shifting to a new phase after reaping the benefits from a ban on the once-rampant practice of sharing account passwords that enabled an estimated 100 million people watch its popular service without paying for it.

The crackdown, triggered by a rare loss of subscribers coming out of the pandemic in 2022, helped Netflix add 57 million subscribers from June 2022 through this June — an average of more than 7 million per quarter, while many of its industry rivals have been struggling as households curbed their discretionary spending.

Netflix’s gains also were propelled by a low-priced version of its service that included commercials for the first time in its history. The company still is only getting a small fraction of its revenue from the 2-year-old advertising push, but Netflix is intensifying its focus on that segment of its business to help boost its profits.

In a letter to shareholder, Netflix reiterated previous cautionary notes about its expansion into advertising, though the low-priced option including commercials has become its fastest growing segment.

“We have much more work to do improving our offering for advertisers, which will be a priority over the next few years,” Netflix management wrote in the letter.

As part of its evolution, Netflix has been increasingly supplementing its lineup of scripted TV series and movies with live programming, such as a Labor Day spectacle featuring renowned glutton Joey Chestnut setting a world record for gorging on hot dogs in a showdown with his longtime nemesis Takeru Kobayashi.

Netflix will be trying to attract more viewer during the current quarter with a Nov. 15 fight pitting former heavyweight champion Mike Tyson against Jake Paul, a YouTube sensation turned boxer, and two National Football League games on Christmas Day.

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All Magic Spells (TM) : Top Converting Magic Spell eCommerce Store

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5 days ago

October 17, 2024

Sven Eggers

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