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Read: JD.COM- What’s Your Competitive Advantage

JD.com: What’s Your Competitive Advantage?

  • JD.com had a productive year so far, but their performance is still average in their competitive industry.
  • A global company with such potential should have higher revenue.
  • Is JD a quality long-term investment for you?

JD (JD.com Inc., $33.16) is China’s second largest e-commerce retail website and as affordable, the stock price is, many investors are anxious for better financial results.

Fast Analysis

JD has a history of low GPM (gross profit margins) ranging from 11% to 14% from 2014 to 2017. Leading corporations that have a higher competitive advantage may have a percentage that lies in 20% or above such as BABA (Alibaba Group Holdings) at 57% and AMZN (Amazon.com Inc.) at 23%.

Investors are also mindful of JD’s earnings history. Limited or erratic growth in earnings may be a sign of the company’s poor management of supply- also known as “boom and bust”.

Image Credit

Though investors do not solely use GPM’s or earnings as a sole deal-breaker for investing, a company that shows consistent growth in these areas is a positive sign of long-term durability.

Read: Honda VS. Toyota- Which Stock Is The Better Buy?

Recent Acquisitions, Mergers & Investments

JD had a busy summer with the large partnership made with GOOGL (Google/Alphabet) and acquisition of a large european fashion brand, Finish Line.

JD also partnered with L. Catterton Asia for a convertible note investment of $175 million in SECO (Secoo Holding Limited), one of the world’s leading online luxury brand. This joint venture was made to further expand revenue and audience in the online retail market.

Related: Alibaba Group Holdings Ltd: The International Powerhouse

Image Credit

On the other hand, analysts such as Zack’s are currently listing JD as a “strong sell” due to the low annualized return rate below 5%.

Should investors wait until the trade dispute subsides between Asia and the United States? JD is taking immediate action through the right investments to broaden their audience.

Please see About Me & Disclaimer for additional information about Black Tea.

Information Attainted:

Nasdaq.com, Zacks.com, Msn.com/Money, CNBC.com

Sysco Corporation (SYY): Ready, Set, Goals!

A company that sets and achieves goals is a company for me.

SYY (Sysco Corporation, $72.83) is one of America’s leading foodservice distributor. Found in the “Consumer Defensive” sector on the NYSE, this powerhouse controls more than 17%, approx. $300 billion in its market. From servicing educational facilities to hospitals, the company stays on top by staying committed to one of the things they see most important, goals.

(Even Jim Cramer has his own humble opinion on SYY)

SYY has consistently created and completed their goals and keep a 3-year plan to hold themselves accountable to. This year they have a plan to finish strong with only three goals in mind:

  • “Enriching the Customer Experience,”
  • “Delivering Operational Excellence,”
  • “Optimizing the Business and Activating the Power of Our People.”

Improving the company from the inside out, the company also set strong goals for the year 2020:

  1. Sales growth of increased 4% or 4.5%.
  2. Adjusted income growth of 9%.
  3. Adjusted net earnings of 9%.
  4. Adjusted diluted earnings per share in the range of $3.40 to $3.50, and an increase of approximately 12%.
  5. Reaching $600 million to $700 million of adjusted operating expenses.
  6. Achieving 16% in adjusted return on invested capital for existing businesses.

SYY is prepared to carry through with the action of accelerating locally managed customer case growth and driving leverage between the growth of gross profit and expense growth.

So Far…

SYY’s achieved $0.94 quarterly earnings (pers hare) from analysts estimates of $0.72 per share last year. Revenue growth grew to $15.32 billion for the quarter ending in July of 2018 and sales increased by 6.1%. The company has now passed consensus EPS estimates three times, great stuff SYY.

Related: Alibaba Group Holdings LTD: Ther International Powerhouse

Many investors compare SYY to other stocks such as KR (The Kroger Corp.), UNFI (United Natural Foods Inc.), CORE (Core-Mark Holding Co., Inc), or SVU (SUPERVALU Inc.). However, investors enjoy investing in SYY for their history of consistent dividends cash payments- recent cash payment amount was $0.36 cents, effective date 10/4/2018)

Please see About Me & Disclaimer for additional information about Black Tea.

Information Attained:

Nasdaq.com,SEC.gov,MSN.com/Money,Zach’s Equity Research

Know Your CEOs: Who is Adena Friedman?

Who Is Adena Friedman?

One powerful woman…

Adena Friedman is the current president and chief financial officer of NASDAQ- the world’s second largest stock exchange in the world. Adena has always been determined to win and achieve excellence in her career, but it took a little work before she reached success.

Education & Career

Raised in the heart of Baltimore, Maryland, Adena attended an all-girls preparatory school at Roland Park Country School and then to Williams College to earn her Bachelor’s degree in political science. After Williams College, she completed her MBA degree at Vanderbilt University’s Owen Graduate School of Management.

Adena started her career journey and worked as an intern as NASDAQ. She then stayed with the company for 18 years before leaving in 2011 to join Carlyle Group L.P.-one of the world’s largest multinational private equity firms. Later on, she returned to NASDAQ as the president in 2014. Adena has been with the corporation ever since.

Personal Life

Her father, Michael Testa, was a managing director of T.Rowe Price for many years. And named after her mother, Adena Testa, is an attorney in a law firm in Baltimore, Maryland.

Related: Who is Jim Umpleby?

She is now 49 years old and married to her husband, Michael Cameron Friedman and has two sons. Adena is not only disciplined and successful in her career, but she is also disciplined as a black belt in Taekwondo.

Adena was listed as #20 out of 100 on the World’s Most Powerful Women by Forbes as well as being the first female CEO of NASDAQ. Congratulations Adena!

About NASDAQ

NASDAQ is the abbreviation for National Association of Security Dealer Automated Quotation system. This corporation is the second largest stock exchange in the world by market capitalization worth $10 trillion. NASDAQ was the world’s first electronic stock market and started trading on February 8th, 1971. The corporation handles approximately 14% of all equities traded worldwide. You may visit NASDAQ.com for extended, updated information on companies traded on the exchange.

Know your CEOs. You may follow her through Twitter:

Check out Adena Friedman (@adenatfriedman): https://twitter.com/adenatfriedman?s=09

Please see About Me & Disclaimer for additional information about Black Tea.

Information Attained:

Forbes.com,Nasdaq.com,Fourtune.com,Wikipedia.com (1)(2)

Alibaba Group Holdings LTD: The International Powerhouse

When “working smarter” pays off.

  • Alibaba is still in the lead as the world’s leading e-commerce corporation.
  • Alibaba has mastered “minority investments” as well as making the right partnerships with the right companies.

BABA (Alibaba Group Holdings Limited,$179.92) is the world’s largest online and mobile e-commerce marke. Headquarters based in Hangzhou and Zhejiang China, BABA has generated $736 billion for the fiscal year (ended March 2018) with over 500 million active monthly users and high revenue from their other businesses such as UCWeb, AutoNavi, Youku, Intime, Caniao Network, Ele.me, Alipay and etc.

The BABA stock is loved by most investors, whether you’re day-trading or buying investments for the long-term, BABA is currently listed at this time as a “strong buy” according to stock analysts.

(Screenshot from Finviz app)

Shareholders are satisfied with their consistently managed financials of even portions of SGA costs (30%) and fair NPM (net profit margin) of 25%. The company’s primary focus is globalization, rural expansion, large data and cloud computing. BABA also have their own strategic strategy for making minority investments as well as making many acquisitions. In April 2018, the company fully acquired Kaiyuan Commerce Co., a leading department store in Northwestern China for RMB of $3.4 billion or $15.36 million in US dollars.

Read: Earnings Week- What To look For In the Next Earnings Report

Acquisitions, Mergers & Investments

BABA has many specialties, yet the company is very skilled with their investment choices. An example of their “minority investments” was announced in their recent 20-F filing:

Beijing Easyhome Furnishing Chain Group Co., Ltd., or Easyhome, a company that operates one of the largest home improvement supplies and furniture chains in China. In March 2018, we acquired a 10% equity interest in Easyhome for a cash consideration of RMB3.6 billion (US$580 million). The business cooperation between Easyhome and us will provide both online and offline customers with a comprehensive home improvement solution.

In early July of 2018, BABA’s Alibaba Cloud and Siemens have partnered to enhance each other’s global digital networks. Siemens is known for their outstanding performance of engineering excellence, quality, and innovation.

Know your CEOs: Who Is Jim Umpleby?

BABA also took a step further and deepened their partnership with SBUX (Starbucks Corporation) this year improve SBUX’s customer base in China with an enhanced the coffee delivery system. President Kevin Johnson stated on behalf fo SBUX,

“Our transformational partnership with Alibaba will reshape modern retail and represents a significant milestone in our efforts to exceed the expectations of Chinese consumers. Starbucks China is one to watch, and I have full confidence in the team that will bring the new innovation behind the Starbucks Experience to life.”

This is nothing but good news for the two power companies.

While some investors believe it’s still fair to buy close to its current 52-week low of $147.50, other investors believe the volatility will weaken after the trade wars calm down. Otherwise, it’s apparent that quality partnerships can strengthen any business.

Please see About Me & Disclaimer for additional information about Black Tea.

Information Attained:

Sec.gov,Alibabagroup.com,Yahoo Finance (Starbucks),MSN.com/money

Who Is Jim Umpleby?

Jim Umpleby is the new CEO of CAT (Caterpillar Inc.,$138.96), located in Peoria Illinois. CAT is a Fortune 100 company that markets and sells machinery through design and engineering. CAT is listed in the Dow Jones Industrial Average (DJIA) sector and the built a strong revenue of $45 billion in 2017.

Coming from his hometown of Highland, Indiana, Jim Umpleby attended Rose-Hulman college. He found CAT through his past job as an engineer and then the president of Solar Turbines, a CAT subsidiary company. Caterpillar proudly states in Umpleby’s biography,

“Jim is leading the company’s execution of the new enterprise strategy to achieve profitable growth. The strategy is based on operational excellence and making Caterpillar’s customers more succesful by providing expanded offerings of products and services.”

Fast Analysis: Blue Apron- When The Whole Company Needs A “Weight Gain”

CAT is the world’s largest construction and mining equipment corporation and has been dealing with falling prices for mining and oil materials since 2012. Analysts feel that there will be “darker days ahead” for Umpleby to lead the corporation ahead of slower production. However, shareholders and the leader of the company feel very strong about the new CEO and have faith that he will lead the company to historical makings.

Please see About Me & Disclaimer for additional information about Black Tea.

Information Attained:

Wikipedia.com,WSJ.com