Mixed housing data, among rising interest rates are already hurting shares of companies related to the housing market. What�� more, higher vitality and uncertainty related to the geopolitical risk in Syria affect the global financial markets. Let�� analyze three stocks of companies directly related to the housing market through wood building products they make.
Highly Dependent on General Market Conditions And Particular Customers
Universal Forest Products Inc. (UFPI) is a holding company that provides capital, management and administrative resources to subsidiaries that design, manufacture and market wood and wood-alternative products. It currently consumes about 7 percent of North American softwood lumber production per year.
On the bright side, an increase in home improvement spending and national housing starts is likely to benefit the company. Management is focusing its energy on business expansion and new product initiatives, to gain market share. Last November they purchased Nepa Pallet assets that strengthened the company�� position in the Northwest region of the US. What�� more, in January they have also acquired Custom Caseworks that enabled growth of industrial business through new product offerings.
Top 10 Forestry Companies To Invest In 2015: Post Properties Inc. (PPS)
Post Properties, Inc., a real estate investments trust (REIT), together with its subsidiaries, engages in the development, ownership, and management of multifamily apartment communities in the United States. As of December 31, 2007, the company owned 22,578 apartment units in 63 apartment communities, including 1,747 apartment units in 2 communities held in unconsolidated entities and 2,266 apartment units in 7 communities. It is also developing and selling 535 for-sale condominium homes in 4 communities and converting 349 apartment homes into for-sale condominium homes in 2 communities. The company primarily operates in Atlanta, Georgia; Dallas, Texas; Washington, D.C.; and Tampa, Florida metropolitan areas. Post Properties has elected to be taxed as REIT under the Internal Revenue Code and would not be subject to federal income taxes, if it distributes approximately 90% of its taxable income to its shareholders. The company was founded in 1971 and is based in Atlanta, Ge orgia.
Advisors' Opinion:- [By Philip Springer]
Post Properties Inc. (NYSE: PPS): 14.7%
Here are the largest homebuilders and their shares’ performance so far this year:
Lennar Corp. (NYSE: LEN): -2.3% - [By Sally Jones] ng>Rate of Return: 30.76%
Down 6% over 12 months, Post Properties Inc., a residential REIT, has a market cap of $2.46 billion; its shares were traded at around $45.02. The tangible book value is 20.98. PPS trades with a P/E ratio of 29.00 and a P/B of 2.10. The earnings yield is 2.80%.
Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 422,734 shares values at around $20.9 million.
PPS is a relatively new holding for the firm, first bought in the second quarter of 2013. The firm bought 422,734 shares at an average price of $49.04, for a loss of 8.2%.
Track historical pricing, revenue and net income since 1993:
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Valley National Bancorp (VLY)
Rate of Return: 26.4%
Up 5% over 12 months, Valley National Bancorp has a market cap of $2.07 billion; its shares were traded at around $10.40. The tangible book value is 5.28. VLY trades with a P/E ratio of 14.60 and a P/B of 1.30. The earnings yield is 3.80%.
Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 1,462,501 shares values at around $13.8 million.
VLY is another new holding for Third Avenue, first buying 1,462,501 shares in the second quarter of 2013, at an average price of $9.34, for a gain of 11.3%.
Track historical pricing, revenue and net income since 1990:
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Brookdale Senior Living Inc. (BKD)
Rate of Return: 23.14%
Up 11% over 12 months, Brookdale Senior Living Inc. has a market cap of $3.35 billion; its shares were traded at around $26.94. The tangible book value is 5.97. BKD trades with a P/B of 3.30. The earnings yield is 1.80%.
Guru Action: As of Sept. 30, 2013, Third Avenue Management holds 658,866 shares values at around $17.429 million.
Bought in the second quarter of 2013, BKD is another new holding for Third Avenue. The firm made a new buy of 658,866 shares at an average price of $27.55, for a 2.2% loss.
Track historical pricing,
Hot Building Product Companies To Own In Right Now: SunCoke Energy Partners LP (SXCP)
SunCoke Energy Partners, L.P., incorporated on July 30, 2012, manufactures coke, which is used in the blast furnace production of steel. The Company's sponsor owns the remaining 35% interest in each of Haverhill and Middletown. The Company's sponsor, through its subsidiary, owns a 55.9% partnership interest in the Company owns and controls its general partner which holds a 2% general partner interest in the Company. The Company's cokemaking ovens utilize efficient, modern heat recovery technology designed to combust the coal's volatile components liberated during the cokemaking process and use the resulting heat to create steam or electricity for sale. The Company operates in cokemaking facilities located in Ohio. In September 2013, SunCoke Energy Partners, L.P completed its acquisition of Lakeshore Coal Handling Corporation. In October 2013, the Company acquired Kanawha River Terminals LLC (KRT).
The Company licenses this advanced heat recovery cokemaking process from its sponsor. The Company's sponsor designed, developed and built, and owns and operates five cokemaking facilities in the United States, including Haverhill and Middletown with an aggregate coke production capacity of approximately 4.2 million tons per year and designed and operates one cokemaking facility in Vitoria, Brazil with a coke production capacity of approximately 1.7 million tons per year. Approximately 90% or 17.5 million tons, was for blast furnace steelmaking operations and the remaining 10% was for foundry and other non-steelmaking operations. The Company's cokemaking capacity represents stated capacity for the production of blast furnace coke. The Middletown capacity on a run of oven basis is approximately 578,000 tons per year.
The first phase of the Company's Haverhill facility or Haverhill 1, includes steam generation facilities which use hot flue gas from the cokemaking process to produce steam. The steam is sold to a third-party pursuant to a steam supply and purchase agreement. The Company! 's Middletown facility and the second phase of the Company's Haverhill facility, or Haverhill 2, include cogeneration plants that use the hot flue gas created by the cokemaking process to generate electricity. The electricity is either sold into the regional power market or to AK Steel pursuant to energy sales agreements. The Company has Approximately 400 acres in Franklin Furnace (Scioto County), Ohio, on which the Haverhill cokemaking facility is located and 250 acres in Middletown (Butler County), Ohio near AK Steel�� Middletown Works facility, on which the Middletown cokemaking facility is located.
Advisors' Opinion:- [By Robert Rapier] There were a half a dozen initial public offerings (IPOs) by master limited partnerships in the first half of the year, and all but one are now in the green while one has nearly doubled in value.
The first MLP IPO of 2013 debuted on Jan. 15. USA Compression Partners (NYSE: USAC), which I mentioned in last week’s issue, provides compression services for the oil and gas industry. Units have advanced 36 percent since the IPO, and at the current price yield 7.3 percent.
The day after the USA Compression Partners IPO, CVR Refining (NYSE: CVRR) made its debut. CVRR was spun off from CVR Energy (NYSE: CVI), and both companies remain majority-owned by Carl Icahn. CVR Refining’s primary assets are two refineries located in Kansas and Oklahoma with a combined processing capacity of approximately 185,000 barrels per day (bpd). These refineries are strategically located near the major Cushing, Oklahoma shipment and storage hub, with easy access to discounted feedstock from the nearby Permian basin, as well as the Bakken shale and Canadian oil sands.
But refiners have struggled with diminished margins in 2013 because of a much lower Brent-WTI differential. After the recently concluded second quarter, CVRR declared a distribution of $1.35 per unit, bringing its per-unit distributions for the first half of the year to $2.93. At the same time, CVR Refining lowered its annual distribution target to a range of $4.10 to $4.80 per unit. This was lower than the outlook issued in March, when it foresaw annual distributions of $5.50 to $6.50. CVRR units slid on the news, and are presently trading slightly below the $25 IPO price. The lower end of the revised forecast implies distributions of $1.17 per unit in the second half of the year, for a forward annualized yield of 10 percent based on the recent $23.50 unit price.
SunCoke Energy Partners (NYSE: SXCP) was the third IPO to debut during a very busy third week of January. SXCP is the first M - [By Aimee Duffy]
But this too is starting to shift. If you look at the most-recent IPOs on the New York Stock Exchange, you'll find many corners of the energy industry represented:
Tallgrass Energy Partners�-- Natural gas midstream, debuted May 14 KNOT Offshore Partners (NYSE: KNOP ) -- Shuttle tankers, debuted April 10 SunCoke Energy Partners (NYSE: SXCP ) -- Coal/coke making, debuted Jan. 18 CVR Refining (NYSE: CVRR ) -- Mid-continent refining, debuted Jan. 17There have also been a few MLP-related funds to hit the market this year, including Global X Junior MLP ETF�and Neuberger Berman MLP Income Fund.
- [By Ben Levisohn]
We like [SunCoke Energy] due to its growth optionality and believe this business model is well positioned to benefit from the steel industry’s over-leveraged balance sheet, lack of profitability, and historically low asset valuations.�[SunCoke Energy] brings to the table a low cost of capital and proven business model. We estimate that�[SunCoke Energy] has business development opportunities across various industries (including coke making, coal handling and ferrous) which could be worth as much as 3-4x in annual EBITDA as the company�� current asset base. [SunCoke Energy] has very low commodity price exposure relative to steel mills and coal miners.�[SunCoke Energy] also maintains a 55.9% common unit interest and a GP interest in [SunCoke Energy Partners (SXCP)] (the MLP) which allows�[SunCoke Energy] to benefit disproportionately from the MLP�� growth given their incentive distribution rights.
Hot Building Product Companies To Own In Right Now: First Merchants Corporation(FRME)
First Merchants Corporation, a financial holding company, provides financial and banking products and services. Its deposit products include demand deposits, savings deposits, and certificates and other time deposits. The company?s loan products portfolio comprises commercial and industrial loans; agricultural production financing and other loans to farmers; real estate loans, including construction, commercial and farmland, and residential loans; individuals? loans for household and other personal expenditures; tax-exempt loans; lease financing; consumer loans; and other loans. It also rents safe deposit facilities; and provides personal and corporate trust services, brokerage services, and other corporate services, as well as letters of credit and repurchase agreements. The company operates through 79 banking locations in 23 Indiana and 2 Ohio counties, as well as through ATMs, check cards, interactive voice response systems, and Internet technology. In addition, First Merchants Corporation operates as a property, casualty, personal lines, and employee benefit insurance agency; and involves in life reinsurance business. The company was founded in 1893 and is headquartered in Muncie, Indiana.
Advisors' Opinion:- [By Sean Williams]
For this week's round of "Better Know a Stock," I'm going to take a closer look at First Merchants (NASDAQ: FRME ) .
What First Merchants does
First Merchants is a financial holding company that provides community and commercial banking services primarily throughout Indiana, but also in Ohio. As of the first-quarter, First Merchants had $4.3 billion in total assets with total loans outstanding equaling $2.9 billion.
Hot Building Product Companies To Own In Right Now: Vertex Pharmaceuticals Incorporated(VRTX)
Vertex Pharmaceuticals Incorporated engages in discovering, developing, manufacturing, and commercializing small molecule drugs for the treatment of serious diseases worldwide. Its products include telaprevir, a prescription medicine used for the treatment of patients with genotype 1 hepatitis C virus (HCV) infection; and Ivacaftor, a prescription medicine used for the treatment of cystic fibrosis. The company markets its products under the INCIVEK brand name in the United States and Canada; INCIVO brand in the United Kingdom, Germany, France, Sweden, Austria, Finland, Denmark, Switzerland, and Norway; KALYDECO brand in the United States; and TELAVIC brand in Japan. Its drug candidates comprise VX-222, a Phase II clinical trial drug candidate, and ALS-2200 and ALS-2158, a Phase I clinical trial drug candidates that are designed to inhibit the replication of HCV; VX-809 and VX-661, a Phase II clinical trial drug candidates that improve the function of defective cystic fibro sis; VX-509, a Phase II clinical trial drug candidate for the treatment of patients with rheumatoid arthritis and other immune-mediated inflammatory diseases; VX-765, a Phase II clinical trial drug for the treatment of epilepsy; and VX-787, an investigational drug candidate for the treatment of influenza A. The company was founded in 1989 and is headquartered in Cambridge, Massachusetts.
Advisors' Opinion:- [By Sue Chang and Saumya Vaishampayan]
Vertex Pharmaceuticals Inc. (VRTX) �shares gained 3.9%. Geoff Meacham, an analyst at J.P. Morgan, said last week that he rates the drug maker�� stock at overweight due to opportunities for the company in the cystic fibrosis area.
- [By Jon C. Ogg]
A larger concern is this “lost in translation” issue. This REIT is acquiring 2 biomedical office buildings that are 96% occupied, with a 15-year term with Vertex Pharmaceuticals Inc. (NASDAQ: VRTX). Vertex is now worth almost $20 billion and is expected to be profitable in 2015. Senior Housing will almost certainly get an earnings boost from this lease, but there is one small problem here – most investors believe that they are investing in�a company that makes its bread and butter from senior living facilities. Owning biotech leases of healthy large companies is not a bad business; it just changes the focus of the company because this will add about 20% or so in size.
- [By Ben Levisohn]
Shares of Regeneron have jumped 3.5% to $316.39–and the S&P 500′s best performer today. Novartis (NVS), which makes Lucentis, has dipped 0.5% to $76.73, while Roche (RHHBY), which makes Avastin, has gained 0.2% to $67.54. Vertex Pharmaceuticals (VRTX), meanwhile, has gained 0.9% to $76.77, making it the 10th best perform in the S&P 500.
Hot Building Product Companies To Own In Right Now: Spreadtrum Communications Inc.(SPRD)
Spreadtrum Communications, Inc., through its subsidiaries, operates as a fabless semiconductor company that designs, develops, and markets baseband processor and RF transceiver solutions for wireless communications and mobile television markets. It offers a portfolio of integrated baseband processor solutions that support a range of wireless communications standards, including global system for mobile communication (GSM), general packet radio service (GPRS), enhanced data rates for GSM evolution (EDGE), time division synchronous code division multiple access (TD-SCDMA), and high speed packet access (HSPA), as well as offer an array of multimedia capabilities, such as MP3 digital audio playback, touch screen, JAVA acceleration, digital camera support, motion JPEG, MPEG4, AVS and H.264 digital video playback, and 64-channel polyphonic ringtone playback. The company also provides single-chip CMOS multi-mode RF transceivers that perform across various standards covering GSM/GP RS, EDGE, wideband code division multiple access, TD-SCDMA, and high speed uplink/downlink packet access. In addition, it designs, develops, and markets a CMMB-based channel demodulator and audio/video decoder processor solution for the mobile television market. The company sells its products directly, as well as through distributors to brand manufacturers, independent design houses, and original design manufacturers primarily in China, Hong Kong, and Macau. Spreadtrum Communications, Inc. was founded in 2001 and is headquartered in Shanghai, the People?s Republic of China.
Advisors' Opinion:- [By Brian Pacampara]
What: Shares of Chinese smartphone chip maker Spreadtrum Communications (NASDAQ: SPRD ) surged 17% today after Tsinghua University, through its subsidiary Tsinghua Unigroup, offered to acquire it for $1.4 billion.
- [By Brian Pacampara]
What: Shares of smartphone chip maker Spreadtrum Communications (NASDAQ: SPRD ) popped 13% today after Chinese state-owned company Tsinghua Unigroup agreed to acquire it for about $1.8 billion.
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