Economy:
June New Residential Construction.pdf Privately owned housing starts last month were reported at a seasonally adjusted annual rate of 1.643M, a 6.3% increase from the downwardly revised May 2021 number and up 29.1% from June 2020. Those numbers include apartments. Single family home starts were up 28% Y-O-Y.
Chart: Sticky Price Consumer Price Index less Food and Energy-St. Louis Fed
Sticky-Price CPI - Federal Reserve Bank of Atlanta ("The Atlanta Fed's sticky-price consumer price index (CPI)—a weighted basket of items that change price relatively slowly—increased 3.5 percent (on an annualized basis) in June, following a 4.5 percent increase in May. On a year-over-year basis, the series is up 2.7 percent.")
Chart: Median Consumer Price Index-St. Louis Fed
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Markets and Market Commentary:
Is the Market Still Overvalued? - dshort - Advisor Perspectives
Shiller PE Ratio - 150 Year Chart | Longtermtrends
Market Cap to GDP-The Buffett Indicator-Updated Historical Chart | Longtermtrends
OPEC, allies agree to fully end oil production cuts by September 2022 (7/18/21)
DoubleLine CEO Jeffrey Gundlach says dollar 'doomed' over the long term
Taiwan Semiconductor's Earnings Raise Doubts Over Outlook | Barron's
Don't Give Up on Value Stocks. 10 That Can Beat the Market. | Barron's Notes that Yardeni found that the S & P 500's Growth Index has a forward P/E 11.7 points higher than the Value Index or almost 3 times greater than the average differential over the past decade.
iShares U.S. Medical Devices ETF (IHI) had a 6 for 1 stock split. I own shares but have not discussed my purchases here. (Sponsor's website: iShares U.S. Medical Devices ETF | IHI, expense ratio at .42%)
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Earnings Reports-Owned Stocks:
Generally, bank earnings in the 2021 second quarter are benefiting from recapturing loan loss reserves taken in 2020. I just view that component of E.P.S. as meaning that earnings were not as bad as reported last year due to excessive loan loss reserves and are not as good as they appear now.
For most of the reports that I have reviewed, net interest margin ("NIM") has declined from the 2020 second quarter due to the FED's extremely abnormal monetary policies.
American Electric Power (AEP) Reports Strong Second-Quarter 2021 Earnings (Non-GAAP net income of $589.5M or $1.18 per share with the consensus at $1.133 per share per Fidelity; GAAP E.P.S. at $1.16; revenue at $3.8B; "reaffirmed its 2021 operating earnings guidance range of $4.55 to $4.75 per share.")
Avangrid (AGR)(Non-GAAP net income of $122M or $.35 per share, missing estimates due to May 2021 issuance of 78M shares; "Given its strong first half performance and its outlook for the remainder of the year, AVANGRID is increasing its 2021 U.S. GAAP and non-U.S. GAAP Adjusted Net Income outlook to $700-$765 and $730-$795 million, respectively. U.S. GAAP and non-U.S. GAAP earnings per share are expected to be in the range of $1.95-$2.14 per share and $2.04-$2.22 per share, respectively. Earnings per share used in the updated outlook reflect the May 2021 share issuance of approximately 78 million shares which increases AVANGRID's weighted average shares to 358 million for the full year 2021. The Company's previous earnings per share outlook assumed 309.5 million shares. In addition, these outlook ranges assume the close of the PNM Resources merger occurs at the end of 2021."; the stock was sold at $51.4 per share to a wholly owned subsidiary of the Qatar Investment Authority and to AGR's majority shareholder Iberdrola- 8-K)
BCB Bancorp, Inc. (BCBP) Earns $8.1 Million in Second Quarter (net income of $8.1M; E.P.S. = $.45 with consensus at $.40; increased quarterly dividend by 2 cents to $.16 per share; efficiency ratio 48.9%; NIM = 3.47%; ROA = 1.12%; ROE = 12.6%; Coverage Ratio = 169%; NPL Ratio = .94%; tangible book value per share = $13.32)
Citizens Financial (CFG) SEC Filed Earnings Press Release (E.P.S. of $1.44 with the consensus E.P.S. at $1.104 per Fidelity; net income $648M; efficiency ratio = 62%; NIM = 2.72%, down from 2.88% in the 2020 second quarter; ROTE = 17.5%; ROA = 1.41%; Charge off Ratio = .25%; NPL Ratio = .64%; Coverage Ratio = 267%; total capital ratio 13.5%; tangible book value per share = $33.95
First Horizon (FHN) SEC Filed Press Release (net income of $295M or $.53 per share; non-GAAP E.P.S. was $.58 which excludes 5 cents per share of items related to FHN's acquisition of Iberiabank; consensus E.P.S. at $.435 per Fidelity; NIM = 2.47%, down from 2.9% in the 2020 second quarter; net recoveries of .07%; adjusted ROTE = 22.2%; adjusted ROA = 1.54%; adjusted efficiency ratio = 59.17%; NPL Ratio = .61% total capital ratio = 13.21%)
F.N.B. Corp. (FNB) SEC Filed Earnings Press Release (E.P.S. of $.31 with the consensus at $.288 per Fidelity; NIM = 2.7%, down from 2.88% in the 2020 second quarter; efficiency ratio = 56.83%; ROE = 8.14%; ROTE = 15.85%; ROA = 1.01%; NPL Ratio = .51%; coverage ratio 278.2%; Charge off ratio = .06%; tangible book value per share = $8.2)
Hope Bancorp (HOPE) Reports 2021 Second Quarter Financial Results (net income of $53.8M or $.43 per share; consensus at $.382 per share per Fidelity; NIM = 3.11%, up from 2.79%; efficiency ratio = 53.12%, up from 55.27% in the 2020 second quarter; ROA= 1.25%; ROE 10.41% ROTE =13.5%; Charge off ratio = .35%; Coverage Ratio = 113.36%; NPL Ratio = 1.24% (high); total risk based capital ratio = 13.16%)
IBM Reports 2021 Second-Quarter Results {GAAP E.P.S. continuing operations = $1.47; operating E.P.S. = $2.33 beating the consensus estimate of $2.29 per Fidelity; revenues up 3% to $18.7B but flat adjusted for divested businesses and currency; free cash flow - $1B; "GAAP earnings per share results include a ($1.58) per-share impact for charges related to amortization of purchased intangible assets and other acquisition-related charges, retirement-related charges, U.S. tax reform enactment impacts, and transaction costs associated with the Kyndryl separation. The impact of the Kyndryl separation costs was ($0.20) per share." I am down to 9 shares with an AC of $106.37 per share, see Item # 2.M. Sold 1 IBM at $151.33}
KeyCorp (KEY) SEC Filed Press Release (net income of $698M or $.72 per share with the consensus at $.72 per share; NIM 2.52%, down from 2.76% in the 2020 second quarter; ROTE = 22.34%; ROE = 18.34%; ROA = 1.64%; Charge 0ff ratio = .09%; Coverage Ratio = 175.8%; NPL Ratio = .69%; total capital ratio 123.2%)
M&T Bank Corporation (MTB) Announces Second Quarter Results (GAAP net income of $458M or $3.41 per share includes $.02 per share in merger related expenses; consensus E.P.S. at $3.616 per Fidelity; ROA = 1.22%; ROE = 11.55%; ROTE = 16.68%; NIM = 2.77%, down from 3.13% in the 2020 second quarter; efficiency ratio = 58.4%; Charge off ratio = .19%; NPL Ratio = 2.31%, up from 1.18% in the 2020 second quarter). I have changed my opinion to negative based primarily on the extremely high and growing NPL ratio which calls into question management's competence. This is the worst regional bank report that I have reviewed so far. MTB will soon be acquiring PBCT, which I also own. PBCT reported a NPL ratio of .79% for the 2021 second quarter. People's United Financial Reports Second Quarter Net Income of $170.8 Million, or $0.39 per Common Share
Seagate Technology (STX) Reports Fourth Quarter and Fiscal Year 2021 Financial Results (GAAP E.P.S. $2.07; Non-GAAP E.P.S. = $2 beating the consensus of $1.84; revenues up 20% to $3B; company bought back 2.6M shares in the quarter; free cash flow of $354M for the quarter; 2021 F/Y ending 7/2/21 GAAP E.P.S. $5.36 with Non-GAAP at $5.64 compares to $4.95 in F/Y 2020; Non-GAAP E.P.S. guidance for the 2022 fiscal first quarter is $2.20 plus or minus 15 cents; declared quarterly dividend of $.67 per share)
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Trump PAC has not used any of the $75M its raised this year to help fund election audits: report | TheHill; Trump’s PAC collected $75 million this year, but so far the group has not put money into pushing for the 2020 ballot reviews he touts - The Washington Post Just another scam by Don the Con.
Debunking Trump's Latest Arizona Election Claims - FactCheck.org Donald is incapable of being truthful.
Several Arizona Republicans continue to make false claims in furtherance of their brazenly bogus audit of the November 2020 Maricopa County election results. This is to be expected from them. Fact check: Arizona audit chief baselessly raises suspicion about 74,000 ballots; Arizona GOP Official Slams Cyber Ninjas' 'Simply Not Accurate' Election Numbers; Arizona election auditors say they don't have enough information to finish report - CBS News; The Republicans are trying to prevent any independent scrutiny of what they are doing. Arizona's Bizarre Election Audit Likely Can't Keep Documents Secret, Judge Rules I would note that the Maricopa Election Board of Supervisors has 5 members and 4 of them are Republicans. Those republicans signed off on the validity of the reported results. GOP-dominated Arizona board of supervisors call for end to election audit - CBS News
Trump attacks Republican who has criticized Arizona audit | TheHill
Republican Arizona State Senator Wendy Rogers (R) Calls for New Election, Says Biden Electors Must Be Recalled The idea is to keep holding elections until Donald wins.
More Trump Election Distortions - FactCheck.org This is to be expected from the sociopathic leader of America's anti-democracy party.
Trump Supporter: Capitol Rioters 'There to Overthrow the Government': Book The Republicans who stormed the Capitol knew that Congress had convened to receive the certified election results and wanted at a minimum to disrupt the Constitutional process confirming Biden as the next President.
Florida man gets 8 months in prison in 1st felony sentence from Capitol riot The felony is obstructing an official proceeding which carries a maximum sentence of 20 years.
“You’re Gonna Have a Fucking War”: Mark Milley’s Fight to Stop Trump from Striking Iran | The New Yorker; Top U.S. general feared Trump would attempt coup after election loss, new book says - CBS News
A Republican's unwillingness to accept Trump's Big Election Lie will lead to ouster from party positions. Jason Roe, Michigan GOP official critical of Trump, resigns from executive director post - The Washington Post A refusal to lie is not permitted in Trump's party since lying all of the time about almost everything is Trump's new "conservative" value.
Vaccine hesitancy becomes vaccine hostility as opposition to shots hardens - The Washington Post
How Republican Coronavirus Vaccine Opposition Got to This Point - The New York Times 47% of Republicans said in a recent poll that they were not likely to get vaccinated. Post-ABC poll finds Biden popular but Republicans resisting the coronavirus vaccine. - The Washington Post In TrumpWorld, it is Biden's fault that they refused to be vaccinated.
Details of what happened on Jan. 6 : ‘I Alone Can Fix It’ book excerpt - The Washington Post This is an excerpt from this recently published book: I Alone Can Fix It: Donald J. Trump's Catastrophic Final Year The book has almost a minute by minute account of what happened on 1/6/21.
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1. Added 100 AX.UN:CA at C$11.53:
Quote: Artis Real Estate Investment Trust - A Canadian REIT that owns property located in Canada and the U.S. Portfolio Map – Artis REIT
Website: Artis REIT
Artis has been selling properties with the most recent transaction being the disposition of 26 properties in the Greater Toronto Area, raising C$696.7M. Two additional industrial properties in that geographic area will soon by sold for C$53.3M in gross proceeds. "The total sale price for the portfolio of $750.0 million represents a price per square foot of $297. After adjusting for one outstanding mortgage of approximately $15.2 million and anticipated closing costs, the transaction will generate total net proceeds of approximately $734 million, exceeding the REIT's most recently reported International Financial Reporting Standards fair value of $550.7 million by 36.2%." Artis Real Estate Investment Trust Closes the Sale of GTA Industrial Portfolio
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
I currently own 200 shares of the CAD price units.
My last trade was to sell all of my ARESF units. Item # 1 Eliminated ARESF-Sold 280 at US$8.51 (12/25/20 Post)(profit snapshot = $77.08)
Dividend: Monthly at C$.05 per share
Distribution History – Artis REIT
Artis Real Estate Investment Trust Announces Monthly Cash Distribution
Yield at C$11.54 TC = 5.2%
Last Earnings Report (Q/E 3/31/21): Artis Real Estate Investment Trust Releases First Quarter Results and Q1-21 MDA:
Portfolio Dispositions 1st quarter:
Last Round-Trips on CAD priced units: Item # 3.A. Pared Artis REIT: Sold 200 AX-UN.CA at C$12.94 (3/8/17 Post); Item # 1 Sold 300 AX-UN:CA at C$15.71 (9/26/14 Post)
Other Material Recent News: Artis Real Estate Investment Trust Enters Into Agreement with Sandpiper Asset Management Inc.
2. Small Ball:
A. Added to CET in Schwab Account-Bought 2 at $42.07:
Quote: Central Securities Corp
Sponsor's website: Central Securities Corporation
SEC Filing-Holdings as of 3/31/21
Largest Investments as of 12/31/2020:
As explained in a 7/2/21 comment, this purchase resulted from a brain malfunction.
Last Discussed: Item # 1.L. Started CEF in Fidelity Taxable Account-Bought 5 at $32.03 (1/16/21 Post) I still own those shares. As previously discussed, the largest holding is in the private company Plymouth Rock that had a cost basis of $710+K and an estimated market value of $241.604M as of 3/31/21. CET sells shares back to Plymouth Rock from time to time.
Schwab Account Position: 7 shares with an average cost of $34.83 per share.
Data as of 6/30/21 (updated weekly):
Closing Net Asset Value per share: $50.17
Closing Market Price: $42.19
Discount: -15.91%
Average 5 year discount: -17.28%
Sourced: CET-CEF Connect
B. Started AFIN in Vanguard Taxable-Bought 20 at $8.38; 5 at $8.16; 5 at $8:
Quote: American Finance Trust, Inc. Cl A (AFIN)-Externally Managed REIT
Investment Category: Equity REIT Common and Preferred Stock Basket Strategy
Last Discussed: Item # 1.B. Bought 50 AFIN at $9; 10 at $8.3-Fidelity Taxable (7/2/21 Post) I have nothing substantive to add to that recent discussion.
AC this Account: $8.28 (30 shares)
Dividend: Quarterly at $.2125 per share ($.85 annually)
Yield at $8.28 = 10.27%
Last Ex Dividend: 7/9/21
In this Vanguard account, I owned 20 of the 30 shares on the ex dividend date and received a cash dividend of $4.25:
C. Pared GDO in Fidelity Taxable-Sold 10+ at $18.62:
Quote: Western Asset Global Corp Defined Opportunity Fund Inc. (GDO)-A Leveraged Bond CEF that will liquidate on or about 12/2/24.
Sponsor's Website: WA Global Corporate Defined Opportunity Fund Inc.
Western Asset Global Corporate Defined Opportunity Fund Inc. (GDO)-SEC Filed Shareholder Report for the period ending 4/30/21 (cost $344.255+M/Value then at $384.164+M)
Leverage Details as of 4/30/21:
Profit Snapshot: +$16.47
New AC per share this Account: $15.12 (56+ shares)
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| Snapshot Intraday on 7/1/21 after pare |
The average cost per share was reduced from $15.42.
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| Snapshot Intraday 7/1 before pare |
Dividend: Monthly at $.101 per share ($1.212 annually)
Yield at $15.12 = 8.02%
Data Date of 7/2/21 Trade:
Closing Net Asset Value Per Share: $18.67
Closing Market Price: $18.62
Discount: -.27% (7/2/21 NAV per share and $18.62 closing price)
Average 5 Year Discount. = -6.59%
Sourced: GDO-CEF Connect
Last Elimination: Item # 1.B. Eliminated GDO-Sold 224+ at $16.47-Used Commission Free Trade (3/3/19 Post)(contains snapshot of prior trades)
Recent Buy Discussions: Item # 1.A. Bought 100 GDO at $16.72 in Schwab Taxable Account (11/7/2020 Post)(I still own that 100 share lot); Item # 2.A. Added 35 GDO at $16.78; 5 at $15.6: 5 at $14.34; 5 at $13.75; 5 at $12.3; 5 at $11.4 (4/11/20 Post)
D. Bought 1 LGND at $119.5:
Quote: Ligand Pharmaceuticals Inc.
Ligand "is a revenue-generating biopharmaceutical company focused on developing or acquiring technologies that help pharmaceutical companies discover and develop medicines. Our business model creates value for stockholders by providing a diversified portfolio of biotech and pharmaceutical product revenue streams that are supported by an efficient and low corporate cost structure. . . . We partner with other pharmaceutical companies to leverage what they do best (late-stage development, regulatory management and commercialization) to ultimately generate our revenue. Ligand’s OmniAb® technology platform is a patent-protected transgenic animal platform used in the discovery of fully human mono- and bispecific therapeutic antibodies. The Captisol platform technology is a patent-protected, chemically modified cyclodextrin with a structure designed to optimize the solubility and stability of drugs. Ligand’s Protein Expression Technology is a robust, validated, cost-effective and scalable platform for recombinant protein production, and is especially well-suited for complex, large-scale protein production where traditional systems are not suitable. Ab Initio™ technology and services for the design and preparation of customized antigens enable the successful discovery of therapeutic antibodies against difficult-to-access cellular targets. Ligand has established multiple alliances, licenses and other business relationships with the world’s leading pharmaceutical companies including Amgen, Merck, Pfizer, Sanofi, Janssen, Takeda, Servier, Gilead Sciences and Baxter International."
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| Snapshot Intraday 7/6/21 after pare |
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| Snapshot Intraday 7/7/21 after pare |
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| Snapshot Intraday on 7/7/21 after pare |
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| Vanguard 10 shares at an AC of $36.07 |
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| Schwab 5 Shares AC at $34.61 |
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| Snapshot Intraday on 7/12/21 after pare |
