Daniel Cullinane CPA
25 Plaza 5 25th fl Jersey City NJ phone 732-516-1648 fax 732-516-9778
2500 Plaza 5 25th fl Jersey City NJ 07311 phone 732-516-1648 fax 732-516-9778
TECH COMPANIES PAY DIVIDENDS
Facebook Inc. (NASDAQ: FB), which said this week that the number of its users had reached 2 billion, is shifting gears in its mission statement and looking to combat extremism on its platforms as the largest social media app tries to take greater responsibility for its burgeoning influence in people’s daily lives.
The latest announcement about the user milestone from Chief Executive Officer Mark Zuckerberg follows an announcement from the social media kingpin that Facebook was changing its mission statement and looking to engage communities rather than individuals. Zuckerberg said on a Facebook post:
We want to help 1 billion people join meaningful communities. If we can do this it will not only reverse the whole decline in community membership we’ve seen around the world … but it will also strengthen our social fabric and bring the world closer together.
Facebook’s milestone comes as the social-media colossus has been under fire for how it has handled the dissemination of so-called fake news. It is also taking a more prominent role in combating terrorism. To take steps to address extremism on its platforms, Facebook and other technology companies Monday formed the Global Internet Forum to Counter Terrorism.
Facebook, which went public in 2012, passed the 1 billion user mark in the third quarter of that year. It was the first social media network to do so, according to online statistics portal Statista.Facebook’s announcement follows the announcement last week that YouTube now has 1.5 billion logged-in users, putting the video-sharing site second behind Facebook.
Messaging apps WhatsApp and Messenger, which are owned by Facebook, have more than 1.2 billion monthly active users, and Instagram has more than 700 million monthly active users, according to Forbes.
Facebook has been on an upward trajectory since it was founded 13 years ago by Zuckerberg, Dustin Moskovitz, Chris Hughes and Eduardo Saverin. After moving to Palo Alto, California, in June 2004, Facebook launched Facebook Wall in September 2004, where people could post messages. By December 1 of that year, Facebook had 1 million active users, according to a timeline on its website.
Here are the user totals year by year.
Facebook users by year
2004 1 million
2005 6 million
2006 12 million
2007 58 million
2008 100 million
2009 360 million
2010 608 million
2011 845 million
2012 1.056 billion
2013 1.228 billion
2014 1.393 billion
2015 1.591 billion
2016 1.860 billion
Sources: Facebook Inc., Statista
JUNE NEWSLETTER 5
Until recently, investors owned technology stocks for their growth. Now investors are still buying growth in technology but they are can also get solid dividends. Some of the dividends are more than impressive. It is no secret that investors love dividends. Some dividends are needed for retirement income, but it should be kept in mind that dividends account for up to half of all shareholder returns over time.
24/7 Wall St. conducted a fresh review of the top dividends from America’s largest companies, and there were 25 companies that yielded 3.5% and more. This yield represents what is officially more than one full percentage point higher than the average yield of the S&P and Dow, and it was over 100 basis points higher than a blend of long-term Treasury bonds. Because of that history of lower dividends, it almost felt surprising that four of the top technology stocks with large market capitalizations were on the list.
The big difference between the Treasury yields and equity yields is that the former are locked in place, and most buyers of Treasury notes and bonds are not buying them with major long-term capital gains in mind. Companies are expected to grow in size and raise their dividends over time. That is particularly true of the major technology companies. Investors assume today that revenue and earnings growth, followed by dividend growth, in future years will translate to higher share prices in the years ahead.
At the start of the last week in June, the average yield was 2.37% in the S&P 500 Index and the average yield of the 30 Dow stocks was 2.43%. The yield of the 10-year Treasury note was last seen at just 2.13% and the yield on the 30-year Treasury bond was just 2.70%. These tech giants have dividend yields that blow those yields away, and again the investing community expects that the technology giants should see their stock prices rise in the years ahead.
24/7 Wall St. used trading data and the consensus analyst price targets (mean as an average) from Thomson Reuters. Additional color has also been provided. Here are the top large cap technology dividends of the S&P 500 Index with potential share price appreciation ahead.
Seagate Technology PLC (NASDAQ: STX) had the highest technology dividend yield, at just over 5.9%. The company is best known for its storage devices. It operates globally and dominates in the storage devices space with rival Western Digital. Its focus is on hard drives, solid state drives and portable drives.
Seagate shares just took a serious breather of over 6% on concerns that NAND trends and drive buying may have peaked, but this duopoly of drive-makers has managed to surprise the critics year after year. If you have followed the cost of 1 terabyte over the past two decades, you also would have been concerned at just how these companies could keep thriving and growing. That is why the old disk-drive makers have already branched out into many other segments around storage and memory.
At $39.75 a share after a recent 6% drop, Seagate had a pre-drop average target price of about $46, and its 52-week trading range is $20.77 to $50.96. Seagate has a market cap of just about $12 billion, half that of its rival Western Digital.
Qualcomm’s dividend hikes helped get the yield up, but so did a falling share price. At $55.75 a share, its yield is 4.0% and its market cap is about $83 billion. Qualcomm has a 52-week trading range of $50.84 to $71.62 and an average analyst target price of $61.55.
International Business Machines Corp. (NYSE: IBM) has been a large buyback and dividend payer for years. After having to abandon part of its artificial earnings per share growth efforts to get to that elusive $20 in earnings per share, IBM has focused on growing in its emerging opportunities in cloud, Watson and other efforts. Big Blue’s big problem is that its legacy IT-consulting operations have been bleeding off faster than IBM can grow its emerging tech businesses. IBM still has around 380,000 employees.
A slew of earnings disappointments has been a thorn in its side, and IBM may need new leadership quite soon if it cannot get that turnaround underway. Its revenue was almost $80 billion in 2016 and was down consecutively each year since at least 2012. Still, IBM has market cap of about $145 billion.24/7 Wall St.
25 Great American Companies Paying High Dividends
IBM shares recently traded at $155.10, and that generated a dividend yield right at 3.9%. That is meant to reward shareholders while it tries to get that turnaround going into organic growth again. IBM’s consensus analyst target is up at $165.07, and its 52-week range week has been $142.50 to $182.79.
Cisco Systems Inc. (NASDAQ: CSCO) has been one of the top technology companies in networking for two decades. The company has made hundreds of small bolt-on acquisitions around future technologies, and Cisco hopes that security integration can help bolster its sales ahead. Long-time CEO John Chambers has fully turned the helm over to Chuck Robbins, and Cisco has been in the midst of two large restructurings in the past five years in an effort to “right-size” its headcount and unit structure.
Cisco’s revenue was $37 billion in 2016, and it has been stable but choppy over the past five years, but without any real growth. Cisco shares also remain well down from the tech bubble days back in 1999 to 2000. Choppy earnings have prevented Cisco from participating in the technology rally as much as many of its large-cap old technology peers.
At $31.89 per share, Cisco’s dividend yield is up at 3.61%. Its mean price target from analysts is $35.43, and its 52-week range is $27.13 to $34.60. Cisco remains one of the world’s largest technology equipment and services providers, with a market cap of $161.5 billion, and it also can claim to be one of the largest buyers of its own shares in the history of corporate America.
Apple Inc. (NASDAQ: AAPL), also now a Dow Jones Industrial Average stock, is still quite far from the top dividend yield. Still, its $750 billion market cap and 1.7% yield means it is paying more out each year than most technology companies, with about $13 billion in total dividend dollars spent at the current annualized rate. Apple has been more focused on stock buybacks, and those buybacks of the past and those scheduled ahead may be what prevents Apple from becoming the world’s first $1 trillion company by market cap.
Despite President Trump's .push to turn out the lights on Energy Star. The 25 year old program will shine on, at least for the immediate future. Hundreds of businesses are joining environmentalists and energy groups to save it, and Congress, tasked with a slew of other priorities, is sure to heed the call. Though it takes up only $50 million of the annual budget, the federal program is credited with saving consumers more than $30 billion a year in energy costs
USERS HIT 2 BILLION
2 BILLION USERS
A new report details the extent of Americans’ drug consumption, which are the narcotics of choice, which states’ residents spend the most to get the drugs and what some people are willing to do to get them.The report, published and funded by drug-counseling organization Addictions.com, comes at a time as more states legalize marijuana and local officials weigh the costs of legalization to their communities.A data scientist conducted the study by polling 1,000 drug users across the United States and compiling data based on their state, substance of choice and educational background.
Marijuana is the drug of choice, making up more than 70% of all drug use among those polled, followed by cocaine at 6.5%. Cocaine users spent the most money on their drug, around $83 a day, followed by heroin users ($51.60 per day). Marijuana users spend $25 a day on weed.Alaskans spend a daily average of $384 on drugs, nearly five times the average of other states. Experts attribute this to a surging use of heroin in that state.
Other states were daily drug spending is high are Ohio ($77.50), West Virginia ($55.00), Alabama ($54.90) and Indiana ($51.00). A surge in the use of opioids is a major factor in the increase in drug spending. On the lower side, drug users in Nebraska and Idaho spend 50 cents a day, followed by Mississippi ($2.50) and North Dakota and New Mexico ($5.00).
Researchers claim that those who become addicted to cocaine could spend more than $16,000 over their lifetime on the drug. Users of ecstasy would spend $14,209 over their lifetime, the second-highest total. The report also found that college graduates are the most likely to turn to sex work to bankroll their drug habit.
Those in the study between the ages of 30 and 39 spend the most per day on their drug habit of any age cohort, $39.74 a day. Also, those with a graduate degree spend the most per day on drugs, $65.65.Drug dependence has divisive repercussions for the families of drug abusers. More than 38% of users of hallucinogenic mushrooms said they stole money from family members to support their drug use, followed by users of crack cocaine (33.0%), ecstasy (28.6%) and cocaine (28.0%)
Experts are concerned that with more states legalizing cannabis for recreational and medical use, the numbers for addiction will increase as the drug becomes more acceptable to use.
Medical and recreational use of marijuana is legal in Massachusetts, Colorado, Washington, Alaska, Oregon, Nevada, California and Maine. Twenty-one states and the District of Columbia restrict marijuana for medical use only.
Opioid use has become a scourge in communities across the nation, with abuse of prescription opiates, including hydrocodone, oxycodone and fentanyl, responsible for nearly half of U.S. opioid-related deaths
Facebook, Inc. (NASDAQ: FB) shares took a dip on Tuesday despite the social media giant announcing a pivotal milestone. The social network has now broken 2 billion monthly active users (MAU), making it the first ever to reach this mark.
In other terms this is about one quarter of the entire world’s population and more than half of the people on the internet.
This number absolutely blows any other social media site out of the water. The next closest would be Google’s YouTube which recently reported that it has approximately 1.5 billion logged-in users in a month.
Separately, Facebook’s Instagram platform has 700 million users and Twitter only boasts about 328 million users.
According to Bloomberg Tech:
Facebook is reaching the milestone just a few days after co-founder and Chief Executive Officer Mark Zuckerberg declared that simply adding more people to the social network isn’t enough. He outlined a new mission for the Menlo Park, California-based company, centered on helping people build strong bonds, in response to isolationist and nationalist movements around the world.
Excluding Tuesday’s move, Facebook has outperformed the broad markets with the stock up 33.5% year to date. Over the past 52-weeks the stock is actually up closer to 37%.
Shares of Facebook were last trading down 1.5% at $151.26, with a consensus analyst price target of $169.30 and a 52-week range of $110.55 to $156.50.
Copyright © Daniel Cullinane CPA.
Pandora Media Inc. (NYSE: P) continued to rally this week following news that its chief executive officer, Tim Westergren, would be stepping down from his executive role and from his position on the board of directors. Effective immediately, it was announced, Chief Financial Officer Naveen Chopra will take over as the interim CEO. Pandora also appointed Jason Hirschhorn to its board, filling a recently vacated seat.Prior to Monday’s move, the stock was actually down 36.5% so far in 2017, which is very weak in comparison to the broad markets. Over the past 52 weeks, the stock is down closer to 32%.
For some quick background: Chopra was hired on at Pandora back in February. Chopra previously served as the CEO and CFO at TiVo and is currently on the board of directors at Vonage.Westergren is a 17-year industry veteran who actually co-founded the company, although he did not spend his entire time as the CEO. It is strange, however, to see a founder relinquish his role in the company like this, especially his spot on the board. Uber is seeing a similar situation with its CEO, although under different circumstances. In a release from Pandora, Westergren commented:
I am incredibly proud of the company we have built. We invented a whole new way of enjoying and discovering music and in doing so, forever changed the listening experience for millions. I came back to the CEO role last year to drive transformation across the business. We accomplished far more than we anticipated. We rebuilt Pandora’s relationships with the music industry; launched a fantastic Premium on-demand service, and brought a host of tech innovations to our advertising business. With these in place, plus a strengthened balance sheet, I believe Pandora is perfectly poised for its next chapter.
Shares of Pandora were last seen up 5.4% at $8.95 on Wednesday, with a consensus analyst price target of $11.59 and a 52-week trading range of $6.76 to $14.98. Over the past week, the stock is up 8%.
PANDORA CONTINUES TO RISE
UPS Adding Green Vehicles, Looks to Cut Emissions 12% by 2025
Package delivery giant United Parcel Service Inc. (NYSE: UPS) has said it plans to cut greenhouse gas (GHG) emissions in its fleet of delivery vehicles over the next three years by purchasing at least 25% of new non-conventionally powered vehicles. The company’s total ground fleet currently numbers about 114,000 of which about 8,300 are alternative fuel and advanced technology vehicles.
In the company’s latest Sustainability Report, released Monday, the company set a goal of a 12% reduction in GHG emissions across its global ground operations by 2025.
The company’s aircraft fuel GHG emissions comprise 58% of UPS’s total emissions, but the company said it is not setting a target for an absolute reduction in airplane fuel consumption because there is no economically feasible alternative available.
UPS has set three targets it sees as critical to reducing GHG emissions:
We’re aiming for 25 percent of total electricity to come from renewable sources by 2025, a significant increase from the less than 1 percent in 2016. We’ve already started, investing $18 million in on-site solar at eight U.S. facilities, which will expand our solar capacity nearly five-fold.
We’re expanding our rolling laboratory, our fleet of more than 8,300 vehicles used to develop and test low-carbon fuels and technologies. By 2020, a quarter of annual vehicle purchases will be alternative fuel or advanced technology vehicles, up from 16 percent in 2016.By 2025, we’re sourcing 40 percent of all ground fuel from sources other than conventional gasoline and diesel, nearly double the ratio used in 2016.
Carbon intensity — the amount of carbon dioxide-equivalent emissions per package delivered — has dropped by 17.9% in U.S. small package operations, 9.1% in global airline fuel use and 30.9% in U.S. supply chain and freight operations.
UPS TO CUT EMMISSIONS
Virtual realtiy is poised to get a boost from so called internet fast lanes coming up in the next few years, after the Federal Trade Commission rolls back utility style web regs later this year. Businesses will be able to cut deals with web providers to speed up certain data intensive content, such as VR games or remote health care. The goal: Ensuring that high quality video streams smoothly. Consumer advocates will howl that the practice is unfair to both users and small businesses. Intense broadbankd competition will help limit blowback as wired and wireless web providers battle for cutomers and drop data prices.
The new guy on the work site? A "seeing" computer that spots safety hazards with artificial intelligence tools that mine video data in real time to analyze activity on a factory floor, a construction site and elsewhere. Microsoft and other tech firms are working on systems that detect misplaced tools, careless employees and more. Workers and managers will automatically receive alerts, making it easier to correct dangerous situations as well as comply with workplace safety regulations