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September 2017

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Demand is unlikely to get better for Statasys, Ltd’s products, says Piper Jaffray

Stratasys, Ltd. (NASDAQ:SSYS) has received a downgrade at Piper Jaffray, a financial research firm. The analyst justified his action by stating that the demand for SSYS products have hit an all-time low and as things are, it is unlikely to get better. SSYS is considered among the industry leaders in 3D printing industry and despite being a very technologically advanced industry, the demand has been meagre at best. The channel checks hint towards further weakness and demand is likely to continue to fall in the near term. Unless a new innovative feature is introduced that makes 3D printing more practical, the demand is unlikely to bounce back.

Piper Jaffray analyst, Troy Jensen did a survey regarding the recent demand trends in 3D printing space and the results were far below optimal. Not only SSYS but 3d printing industry as a whole has seen some major slowdowns in the past few months, specially, towards the end of June quarter. The market sentiment is deteriorating at a rapid pace and given the situation it is unlikely to get better. The weakness is likely to carry over to the second half of the year, however, slightly better demand is expected owing to seasonality.

The analyst advises investors to stay clear of the 3D printing industry and unless a major change occurs. SSYS is also expected to reduce guidance numbers significantly and as a result Piper Jaffray has also cut their estimates for years 2016 and 2017. The rating for the stock now goes to Neutral from Overweight, while, the price target gets trimmed down to $24 from $32.

The analyst opinion for SSYS has two Buy, four Outperform, 12 Hold, two Underperform and one Sell rating. The stock now trades at $22.50 after having declined by 3.39% since the open of the premarket.

We might continue to see normal console cycles after PlayStation 4

Sony Corp.’s (ADR) (NYSE:SNE) PlayStation 4 Neo is the company’s approach to extend the console’s capabilities to support new technologies like 4K TVs and virtual reality. It was confirmed after various rumors and leaks that an upgraded PlayStation 4 model is indeed coming, but Sony did not say when it would arrive.

The console’s announcement breaks the traditional lifecycle where we used to see one console being carried on throughout its tenure until it was replaced by a successor. Talks of a mid-generation console refresh emerged earlier this year with Sony and Microsoft Corporation (NASDAQ:MSFT) both using this strategy. Both console manufacturers are officially working on new systems, and while the move strongly suggests that traditional console lifecycle will now be replaced, Sony believes it to be otherwise.

In an interview, Sony President of Worldwide Studio Shuhei Yoshida commented on whether PlayStation 4 Neo spells a shorter lifecycle for the console, to which Yoshida San clearly said we should not expect as such. He added that “PS4 is PS4” and “high-end PS4 is still PS4,” suggesting that both consoles will be phased out together at their appointed time.

Previously, Sony Interactive Entertainment President Andrew House expressed in an interview with The Guardian that Sony is not moving away from the traditional console lifecycle: “I’m certainly not making that statement” he said.

PlayStation 4 Neo is a high-end model of the existing console meant to deliver better resolution and higher visual fidelity. For all we know thus far, with the rise of 4K TV fervor in the market, Sony saw an opportunity to cater to that segment which wants more performance. One of the reasons Andrew House explained during the interview was potential customers eventually moving to PCs, due to console hardware which grows outdated over time.

Mercedes-Benz announces plan to roll out all-electric HD truck by 2020 with range of 120 miles

Last week, Tesla Motors Inc (NASDAQ:TSLA) announced an expansion plan to cover all the major forms of terrestrial transport, which included a heavy-duty truck (Tesla Semi) for commercial market. Now, Mercedes-Benz has joined the all-electric semi-trailer truck race, according to Bloomberg.

The German luxury automaker expects to offer zero-emission HD truck in five-year time. Daimler AG, parent company of Mercedes, said earlier today that the vehicle, named ‘Mercedes-Benz Urban eTruck,’ will likely have range of 200 km (120 miles) per charge and will be able to handle as much as 26 metric tons of loads.

The vehicle will address “inner-city tasks” like deliveries to supermarkets, and will likely hit the roads by the beginning of the next decade. Truck and car manufacturer are going towards electrification to meet stricter emission standards; though there are limited options due to scarcity of durable batteries to thrust fully-loaded automobile for extensive driving time.

Daimler Trucks head, Wolfgang Bernhard, said, “Until now, there were extremely few commercial vehicles with electric powertrains.” He believes that battery packs now offer significantly better performance, charging times, and costs. American startup, Nikola Motor, expects to unveil an electric truck prototype by the end of this year, which will have the range of 1,200 miles, along with natural gas range extender.  Additionally, Daimler’s Fuso brand is testing 6-ton Canter e-Cell truck.

Although there are limited details on Tesla Semi, we do know that the former Model S Program Director, Jerome Guillen, now heads the truck division. CEO Elon Musk said that Tesla Semi will significantly bring down cargo transport cost and increase safety.

IHS Markit analyst, Tom De Vleesschauwer, believes that commercial customers will be hesitant to buy an unproven technology, but Tesla can overcome those skepticisms by working with Wrightspeed’s CEO Ian Wright, who is also a co-founder of Tesla. Mr. Wright’s company builds electric garbage trucks.

Mr. De Vleesschauwer said that Tesla and Nikola Motor have ignited the market and expects electric trucks sales to account for 4% of American and EU medium and HD truck sales by 2025.

Proceeds from Hit Refresh will be going to Microsoft Philanthropies

Microsoft Corporation (NASDAQ:MSFT) CEO Satya Nadella is writing a book titled “Hit Refresh”, in which he will talk about the company, his personal life, and the impact that technology has had on our life and would further have in the future.

Hit Refresh is not a first of its kind project for Mr. Nadella, as he has previously contributed to Slate and Financial Times in the form of opinionated pieces. The book is set to hit the shelves in the Fall of next year in collaboration with Harper Business. According to the now-writer himself, Hit Refresh will not be a typical “how to succeed” book or a memoir of any sort. Mr. Nadella has said that the book will be targeting Microsoft employees, customers, team members, and partners, and the proceeds generated from the book sales will be donated towards Microsoft Philanthropies.

In the words of the publishers Harper Business, Hit Refresh will primarily talk about three major topics, or transformations that have undergone or are undergoing today. One is of Satya Nadella’s life, the other is the transformation that is taking place inside the company that was once the biggest monopoly in the world and now has projects varying from cloud services, to office essentials and gaming consoles, and the third is the transformation and change that has occurred in our lives, and occurs daily through technology.

Hit Refresh represents the act of transforming that we’ve encountered in our day to day lives, and the book will talk about how Mr. Nadella and Microsoft have hit refresh to generate ideas, produce the required energy, and maintaining relevance in this ever-changing landscape of technology. While you would think that Satya Nadella would have a lot on his plate at Microsoft – the changes that have taken place inside the company would back your judgement up – but Mr. Nadella has taken this step to let the world know how the company hopes to hit refresh and how the world of today does so every day without fail.

Here’s why BP’s downstream segment could improve

On the back of gasoline supply glut, refining margins have declined consistently hampering performance of BP plc (ADR) (NYSE:BP). Even integrated oil majors like BP have faced headwinds and their downstream segment’s performance has been impacted.

For example in BP’s last quarterly performance, the profitability from downstream segment declined by around 17% as compared to 1Q, and was around 21% lower on Year-over-Year (YoY) basis. The higher utilization rates of refineries have created a supply glut, which continues to weigh on refining margins, as reflected in the company’s downstream performance in the image below:

 

 

The refining margins declined after 3Q last year, until of recent past when the margins have shown some signs of improvement. The gradual increase in demand for gasoline in US is one of the reason for improving margins, coupled with lower utilization rates of refineries as they go towards a maintenance at end of summer season.

As a result, the gasoline inventories are slowly being cleared up, but still are higher than the inventory levels which have persisted in past. Moreover, we continue to remain bullish for BP’s downstream segment as we expect the gasoline demand to increase in future.

Even Energy Information Administration (EIA) in its short term energy outlook released on August 9 noted that it expects an increase in gasoline’s demand by around 150,000 barrels per day by the year end. This, if increased would result in around 9.3 million barrels per day, and would at record levels.

The major reason behind surge in US gasoline demand is the surge in highway travel in the SU region, which is expected to soar higher by 2.3%, which is on back of lower level of gasoline prices coupled with better labor market situation.

The US Refinery realization rates are already on a decline, and has been lower than as compared to last year’s rate, and is pretty much close to five year average utilization rate.

The efficiency of BP’s downstream segment would serve as another value addition for company’s overall performance. For example, company’s advantaged crude oil processing has improved by around 25%, coupled with a modest 4% increase in its refining utilization.

As a result, company’s margins are improving. More importantly, on back of better processing of feedstock, the pre-tax earnings are also on consistent rise, as shown in image below: 

 

Hence, the efficiency of company’s downstream segment coupled with better outlook for the segment might turn the table for company in future.

That’s a 2:1 ratio this generation

A report by video games research firm, Electronic Entertainment Design and Research (EEDAR), has revealed some insight on the progress of current-generation consoles. The firm presented their report during this year’s Game Developers Conference and now, the report is available online and can be viewed here.

According to the report, Microsoft Corporation’s (NASDAQ:MSFT) Xbox One is currently at 20 million consoles sold worldwide, as of December 2015. This is an estimate based on the data the firm has gathered, the actual numbers may be more or less.

Microsoft’s console has been holding the second spot tightly this generation thus far. Sony Corp.’s (NYSE:SNE) PlayStation 4 is placed close to 40 million units sold. The last official numbers from Sony placed the console at 36 million back in January, so the report has arrived at a safe conclusion.

Microsoft has always been shy of sharing the sales of Xbox One from the beginning. The firm has never revealed sold-through numbers and instead relied on shipped-to-retailer figures or consolidated Xbox One and Xbox 360 hardware sales together in their earnings reports.

It would not be wrong to say that PlayStation 4 has almost double the sales of Microsoft’s console, a situation that is likely to stick around for the entirety of the eight generation. On the other hand, Xbox 360 is sitting at around 81 million lifetime sales, but PlayStation 3 has emerged as the victor of last-generation with around 82 million sales. That is an impressive achievement considering Microsoft had a 10 million unit head-start by the time PlayStation 3 entered the market.

The action-horror franchise will be making another appearance soon in March

In a surprise announcement, Capcom is once again bringing its beloved Resident Evil franchise to current-generation consoles. However, we’re not talking about newer installments. Three of the previous-generation releases in the series will be released, yet again, but this time for Sony Corp.’s (NYSE:SNE) PlayStation 4 and Microsoft Corporation’s (NASDAQ:MSFT) Xbox One.

In a detailed post on the Capcom Unity blog, the developer announced that all three games are going to be available in digital format at the cost of $19.99 each. The games are going to be available in physical medium as well, but only if you’re residing in North America. As for availability, fans of the series might have to wait longer to play their favorite one out of the three. Capcom has confirmed that the games will not be released simultaneously, giving a grace period between each release.  

Rather than following the chronological order, Capcom is going to release Resident Evil 6 first on March 29. The fifth installment will then follow in the summer, leaving Resident Evil 4 as the last to release in fall of this year. Since Resident Evil 4 is widely regarded to be one of the best installments in the series, or at least among the three, Capcom may be keeping the best for last.

The announcement has been met with mixed reactions from fans. There are those who believe that this is a great opportunity to replay these games or at least experience them for the first time after missing out on them previously. On the other hand there are those who think Capcom should have brought the first three games instead. A remake treatment of the highly popular Resident Evil 2 is the number one fan request.

Perhaps after the success of these titles, Capcom will consider porting, or even remaking, previous games to the current-generation platforms.

 

Nike Inc is likely to face pressure from increased competition and weakness in basketball products

Nike Inc. (NYSE:NKE) is among the most popular apparel, sports accessories, sports equipment and footwear producer in the world. The headquarters of Nike are situated in the state of Oregon and it is among the largest multinational corporations in America. The company’s current market capitalization is $92.69 billion and has an average trading volume of 11.15 million shares. The current CEO of the company is Mr. Mark Parker who joined the office in 2006.

Edward Plank, an experienced Jefferies analyst, believes that Nike is headed towards an in line quarter. Although the earnings report will be of critical important the focus of the call will be fixated upon the commentary by the management and the guidance updates for the year 2017. Nike is expected to end the year on a low note as it faces increased pressure from rising competition and slowness in basketball business.

Nike is expected to hold the Q4 earnings call on June 28, after the close of market. Nike is currently faced with a problem of inventory fills and given the competitive pressure from Adidas and Under Armour the company will struggle in maintaining a healthy level of ASPs given the headwinds. As the Olympic games get closer, Nike is likely to increase marketing spend in order to create demand ramps, specially, in the United States. The investors are likely to remain concerned in the near term and are likely to wait on the sidelines to gain clarity as Olympic draws closer.

The analyst reaffirmed a Buy rating, but cut the price target for NKE as the ASP headwinds grow. The analyst opinion for the stock has nine Strong Buy, 15 Buy and eight Hold ratings. The stock now trades at a price of $54.99 and has gained 1.15% in terms of price since the opening of the market.

A triple top formation makes us a bit skeptical about its trend in today’s session

The recent developments that have taken place in Amazon.com Inc. (NASDAQ:AMZN) may have gained traction from many investors, however, a word of caution is advised to investors. Although the Bellevue based retailer’s stock registered three 52-week highs in yesterday’s session, a triple top formation makes us a bit skeptical about its trend in today’s session.

Anyone having an idea about technical analysis would sure know that Triple top is a reversal pattern, after which prices tend to revert back. Although a glance at the pre-market trading may reckon the continuity of the bullish trend in today’s session, prices may pull back from these levels. The bulls are currently the dominant force here, as the bull/bear power indicator suggests, but it is also a risky level for fresh entry.

There have been positive developments over the weekend which reckon that Amazon stock still has a lot of potential, it seems more of a profit taking level. The $370 billion company’s stock is trading near yesterday’s resistance level in the pre-market session, but a pullback is very much on the cards. TheCountryCaller has been holding bullish views for a while now and we believe that it is a lucrative pick in the e-commerce sector.

But the current situation demands a lot of patience by investors. The recent financial results of the company hint that Jeff Bezos is well on his way for a bright future ahead. TheCountryCaller has also discussed the possibility of four-digit stock prices in June, our view has been complemented by renowned brokerages such as Bank of America Corp. The consensus PT stands at $854, which reckons an upside potential of over 10%. We expect the stock to take a dip before it gets going to new heights.

After first being announced back in September last year, Facebook has finally launched Canvas

Facebook Inc. (NASDAQ: FB) is doing everything it can to stay ahead of its competition. In fact, it has been quite successful in this regard. Even though Twitter is trying to utilize the same approach, it is unable to catch up with Facebook. It seems that the media giant does not want to stop there, as it has released yet another great feature for its site: interactive mobile ads, which are better referred to as ‘Canvas’.

Canvas was first announced back in September 2015 and has finally been released by Facebook. The announcement of its launch was made during an event in New York this week.

The feature is designed to cater to the needs and requirements of marketers. It is an improved version of Carousel ads, which essentially gave users the ability to go through brand and product photos to get more information, especially if they are interested. But Canvas, on the other side, has a lot more to offer than just this.

With Canvas, marketers will now be able to create full screen ads, which means that they will be able to create smaller websites within Facebook, around their product or service.

That being said, the ads will not interfere with a user while they are on the social media site, as they are designed to be no different from the normal ads that can be found on the News Feed. However, such ads will offer a separate prompt to gain access to the full experience. Fortunately, they load up and exit quickly, rather than being a hassle.

The feature is available for use through canvas.facebook.com for free. Moreover, the feature does not require third party software or coding to create new ads, which should make it a lot more appealing to marketers who are having a difficult time reaching their target audience.