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BenzingaEditorial

High Quality Companies- The Only Bet You Can Make for Your Future

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Keep in mind that we’re in uncertain times as this unprecedented health crisis has put the world and the global economy at a virtual standstill. Nobody knows what will happen tomorrow and therefore only rare ones dare to forecast short-term market movements. We know we are in for an economic downturn but how bad will it be? And more intriguingly, how different will the world be? But, if there is a rule when it comes to recessions is that they tend to clean the market of weakest players, but they help strong players become great players.

As long as you don’t need this money in the next few years, growth stocks are a good way to go as they are literally planted seeds which are bound to flourish in the future. Growth stock investing isn’t about making a quick buck, they are all about future rewards.

Three high-quality stocks that should have years of growth ahead of them surely are PayPal Holdings (NASDAQ:PYPL), Nike (NYSE:NKE) and a little bit less known animal health company, Zoetis (NYSE:ZTS).

PayPal

PayPal will only be growing and growing as it secured its placement being the first digital payment processor in China. Its app is rallying and it is forcing its endless rivals up their game in the digital sphere. And we don’t just mean startups but also Wall Street big shots such as Bank of America, Citigroup and JP Morgan. Although PayPal is losing its primary payment processor status at eBay (NASDAQ:EBAY), it has sufficient activity to compensate this loss thanks to its other partners: with Argentinian MercadoLibre (NASDAQ:MELI) even going against the e-commerce giant Amazon (NASDAQ:AMZN) itself. PayPal has positioned itself wisely to capture both the Chinese and Latin America markets.

Nike

Nike is a well-managed company that’s simply masterful when it comes to promoting and growing its brand as it is surely among the most valuable brands in the whole world.

The pandemic has led to closure of its stores and factories in China but its fiscal third quarter of 2020 which ended on February 29th was impressive to say the least as digital sales came to the rescue and resulted in a strong double-digit growth that approached a triple digit growth.  Moreover, the pandemic will surely result in consumer behaviour as we learn more about health and wellness, and these are all the values embodied by the Nike swoosh. And by navigating this storm, yet again, Nike showed the world how things are to be done by just doing it.

Along with expanding margins and well-managed expenses and impressive earnings per share prior to the outbreak, Nike proved yet again that it is so much more than a sportswear manufacturer. Its growing online presence is warming up Nike so it can keep running ahead. And for many years ahead.

Zoetis

Committed pet owners will always make sure their beloved furry family members are well taken care of and this has led to so many new businesses such as pet grooming and even clothing. But one thing that is not debatable is health and veterinary medicine has progressed so much to enable our furry friends to be in our lives as long as possible.

Zoetis sells medicines, vaccines, diagnostics, and biodevices for companion and farm animals. And considering animal shelters in the U.S. have reported a boom in pet adoptions during the pandemic along with long-term global growth in pet ownership, this company will have its hands full! Last year alone, sales in the companion-animal segment that make up a half of its total revenue grew a strong 23% excluding currency effects. As for its full year revenue, it grew 7.5% whereas adjusted earnings per share jumped 16%.

This company has the potential to grow even faster over the long term due to its new product innovations. It has what it takes to make through this downturn due to strategic acquisitions that build its integral pet care portfolio such as by acquiring the medical and veterinary diagnostics company Abaxis.

The bottom-line

How do you define these companies as they are playing on entirely different fields? By what they have in common and that is that their product and services are of great value to their customers. So, no matter which scenario we wake up to tomorrow, and we already know that it won’t be a pleasant one, these companies will do just fine and so will their investors.

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

BenzingaEditorial

Should Salesforce Shareholders Rejoice or Be Concerned?

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Mid Cap Stocks

Salesforce (NYSE: CRM) will have its annual meeting of stockholders on Thursday, June 11, 2020, but in virtual form. The stock of the global leader in CRM tumbled immediately following its recent first-quarter results. The months before and at the initial phase of the pandemic were exceptionally good. But it is the second-quarter and full-year fiscal 2021 guidance for the year ending Jan. 31, 2021 that resulted in a downgrade. Yet despite the damage and costs brought on by COVID-19, its shareholders have a lot of positive development to rejoice in.

Impressive growth considering the circumstances

Considering the global climate, the fact that Salesforce continued to grow at a fast pace is beyond admirable. Moreover, highlights from the start of the year include the largest deal that Salesforce ever booked and it is with AT&T (NYSE:T). The telecommunications giant will be building a new unified view of all its customer data using Salesforce. It will begin upgrading its services to create a better customer experience during summer.

Market domination

As for the fiscal 2021, the CRM giant clearly dominated the market with $20 billion of expected annual sales. In addition, the pandemic accelerated the switch to cloud computing. Over the recent months, businesses have rushed to implement work-from-home solutions. This is expected to only further boost the company’s SaaS businesses. As for 2019, it was well ahead of SAP SE (NYSE:SAP) and Oracle (NYSE:ORCL) with 18.4% in market share as opposed to 5.3% and 5.2% respectively, according to research firm IDC.

Altered Revenue Structure

While Salesforce has been known as a SaaS powerhouse throughout its entire 21-year existence, this has now changed. Its largest and fastest-growing business is now “Platform and Other” as it topped Service, Sales, Marketing and Commerce. Moreover, the shape of the enterprise is continually evolving. That’s a profound development for a company which occupies third place on the Cloud list. It is just behind the mighty Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN). Moreover, this is a very clear indicator that the world’s top cloud providers are doing everything in their power to enhance their offerings. The cloud is after all becoming the new IT foundation of the digital economy.

Going strong despite headwinds

Overall, this software giant proved it managed to become and remain an essential ingredient of many organizations’ operational needs. And what’s even more impressive, it maintained its status during such difficult times. The mega-cap cloud computing leader that has a current market cap of $157 billion, along with growing sales of nearly 20% and a stable free cash flow amid a deep recession, is still in an admirable position. And one that is surely envied by its many peers. This tech giant has plenty of liquidity to continue aggressively investing its development along with taking care of both its customers and employees. Moreover, the pace of digital transformation is only accelerating with lifestyles getting significantly altered by COVID-19. And like one of the pioneers leading this transformation, Salesforce has nothing to fear as it is both changing and thriving in the current climate.

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

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BenzingaEditorial

Slack Fails to Deliver Another COVID-19 Blockbuster

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Stock Market Tumble

Unlike Zoom Video Communications Inc (NASDAQ:ZM), Slack Technologies Inc (NYSE:WORK) didn’t manage to deliver a blockbuster quarter. By no means was it bad as the company reported steady revenue growth with usage increasing over the pandemic. Even Amazon (NASDAQ:AMZN) will be offering Slack to its employees. But expectations were quite higher  so shares ended up dropping 17% in extended trading on Thursday.

First quarter earnings report

Revenue of $201.7 million resulted in an adjusted loss of 2 cents per share. The company added a record 12,000 paid customers in the quarter. This is more than 5,000 in the two previous quarters. Slack’s top competitor, Microsoft’s Teams, saw an explosive expansion of 70% in April as it reached more than 75 million daily active users.

For the next quarter, the company’s guidance for revenue is $206 million to $209 million with an adjusted loss of 4 cents to 3 cents per share.

AWS investment

Besides Amazon offering Slack to its employees, Slack will adopt Amazon Web Services’ Chime video-calling technology to enhance its calling features. Slack amended its initial agreement with AWS where it commited to at least $250 million in a five-year period that ended in 2023. It will now pay least $425 million over a five-year period that ends in April 2025.

Slack didn’t board the blockbuster boat but still did good

Revenue growth was 50% which is pretty much the same as 49% in the previous quarter. Zoom pulled off a 169% revenue growth, more than doubling guidance and exceeding forecasts. Not to mention the skyrocketing usage of Microsoft Corporation (NASDAQ:MSFT) Microsoft Teams. Slack didn’t manage to board that boat. But Zoom’s executives have a different way of looking at it. They find it as a great indication that they are not apples-to-apples rivals as the products are not truly competitive with one another. If we exclude the after-hours move, its shares did go up about 70% since the beginning of the year. But can Slack afford not catching up to the popularity of Zoom and Microsoft is a question that subsequent quarters will answer. Yet, many analysts see the pandemic as the point that either makes or breaks such companies whose products benefit from social distancing. If not now, when?

This article is not a press release and is contributed by Ivana Popovic who is a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . Ivana Popovic does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com Questions about this release can be send to ivana@iamnewswire.com

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BenzingaEditorial

Even Oil Giants Are Under Tremendous Pressure

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Canadian Oil

The global oil market is in a state of hysteria. And not only COVID-19 is to blame, although its impact is being felt all over the globe. It is inevitable for the near future to be filled with bankruptcies, cost savings and cuts in spending as businesses are looking for ways to get through this historically difficult period.

The troubled industry

The year already began with over supply thanks to decades worth of expansion in U.S. onshore production. The price war between OPEC and Russia only further amplified the oversupply problem. That issue has at least been resolved. But the real hit was the global economic shutdown from COVID-19 which resulted in a drop in demand. With too much oil and too little demand, oil prices have plummeted to historic lows.

Cutting dividends

The current headwinds are intense, and have led many energy companies to trim their dividends. Royal Dutch Shell (NYSE:RDS.B) and Equinor are two direct competitors that have taken this drastic step to ensure they have ample cash to survive and they have a long histories of reliably returning cash to investors. Even Helmerich & Payne (NYSE:HP) which had a streak of 47 annual dividend hikes under its belt along with a rock-solid balance sheet still felt it necessary to cut the dividend in March.

It’s only logical to question whether or not peers ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX) will be forced to do the same.

Chevron cutting jobs

Chevron has increased its dividend annually for 33 consecutive years. At the end of the first quarter, Chevron’s total long-term debt had increased roughly 20% from the start of the year. At the end of May, it announced a 15 percent cut of its global workforce.

Exxon has no layoff plans

Exxon’s dividend streak is even longer as it has increased its dividend annually for 37 consecutive years. But Exxon’s long-term debt jumped even more than Chevron since the beginning of the year as it rose by nearly a third.

Top and bottom lines at Exxon and Chevron are clearly driven by the price of oil which reached historic lows. Even Russia’s second-largest oil producer PJSC Lukoil (OTC:LUKOY) hurt by lower oil prices as it reported a first-quarter net loss of $669 million on Wednesday.

Shell and Equinor Vs Exxon and Chevron

Thus, Shell and Equinor chose to preserve cash by cutting their dividends. Starting out with much lower leverage, Exxon and Chevron have more balance sheet flexibility and they are using to protect their dividends, for now. Paying a consistent and growing dividend is important to the boards of these energy giants. But the energy market is at a painful place right now.

The boards of Exxon and Chevron will make the hard call to cut their dividends if need be.

Whichever the scenario, the big guys actually have a shot at pulling through thanks to the help of the Trump Administration, unlike many of their small peers which won’t even be able to afford Chapter 11 bankruptcies.

Uncertain future

There have been multiple ups and downs in the historically cyclical energy sector over the last three decades. But the biggest change is yet to take place: the green revolution. Exxon and Chevron have taken steps toward the low-carbon future. Exxon is developing biofuels from algae, while Chevron has invested in solar, wind and geothermal power sources. But environmental activists say they haven’t done enough. So, even with the support of the Trump administration, oil has an uncertain future. And even oil giants will need to fight for survival in the post-COVID-19 era.

This article is not a press release and is contributed by a verified independent journalist for IAMNewswire. It should not be construed as investment advice at any time please read the full disclosure . IAM Newswire does not hold any position in the mentioned companies. Press Releases – If you are looking for full Press release distribution contact: press@iamnewswire.com Contributors – IAM Newswire accepts pitches. If you’re interested in becoming an IAM journalist contact: contributors@iamnewswire.com

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