Tag Archives: Spain
Posted on 26. Jun, 2012 by Harvey Sax.
Monti lashes out at Germany ahead of summit
By Guy Dinmore and Giulia Segreti in Rome and Peter Spiegel in Brussels
Mario Monti has set the stage for a tough fight with Germany at the EU summit this week, insisting that he will continue to push Italy’s proposal to use eurozone bailout funds in an attempt to stabilise financial markets.
Italy’s technocratic prime minister’s frustration with Germany surfaced in a combative speech to parliament, saying he would not go to Brussels to “rubber-stamp” pre-written documents and was ready to extend the two-day summit until Sunday night if needed to reach agreements before markets reopen on Monday.
Posted on 12. Jun, 2012 by Harvey Sax.
Everyone is nervous about Europe. Me too. I have no way of knowing how much of this is already priced in the market. You’d have to say a lot based on the violent reaction in the oil patch, some European markets but I don’t see any positive outcome from this weekend vote in Greece. If they vote to keep the austerity demands in place, brief rally and the market will soon say the economy is just going to at best muddle along and at worse, be right back at the bread line. On the other hand if they abandon austerity, there is likely to be some kind of Euro shock although it could be brief followed by a very sharp rally if Germany agrees to tighter fiscal ties. From what I can gather the Germans are done with the Greeks and might be willing to be more cooperative with the ECB if they’re gone. A lot of what ifs and no way for me to have any edge. If it’s 2008 redux, there is one big difference. It’s Summer not Fall.
Posted on 05. Jun, 2012 by Harvey Sax.
I’ve been struggling with a metaphor to describe the state of affairs in Europe. I’ve got it now. It’s a bad marriage . All parties now realize they’d be better off ending it except they can’t afford the divorce. At some point, my guess is that Germany answers the question, “Why are euro divorces so expensive? Because they’re worth it.” or do they just learn to live together and make the best of it. I don’t know the German psyche well enough to answer that one. Perhaps one of our readers will hazard a guess?
Posted on 03. Jun, 2012 by Harvey Sax.
I don’t pretend to know what’s going to happen but I’ve said many times, the world would be much better off without the euro. For reasons beyond my comprehension, the Europeans seem hell bent on keeping it. Perhaps this speech from George Soros will make it clearer to you.
Posted on 31. May, 2012 by Harvey Sax.
Spain’s Banking Rescue Should Become Example for Europe
Europe’s leaders can’t save their currency union without figuring out a way to salvage the region’s banks. Spain is a perfect place to start.Perhaps no country better illustrates the mutually reinforcing links among the euro area’s banking, sovereign-debt and economic crises than Spain. Its banks are largely paralyzed amid concerns about heavy losses on real estate loans that, by various estimates, could require as much as 120 billion euros $150 billion in fresh capital to offset. Tight bank credit has in turn deepened the country’s economic slump, increasing banks’ potential losses and fueling fears that bailout costs will overwhelm the Spanish government’s already stretched finances. The longer the situation lasts, the worse it gets: Nervous investors pushed Spain’s 10-year borrowing rate as high as 6.7 percent Wednesday, up from less than 5 percent in early March.
Posted on 12. Apr, 2012 by Wilensky.
Not much needs to be said here. Apple makes more money than three european countries combined ($33 bil in earnings vs $32 bil in earnings for Europe). Its valuation is more than three european countries combined. How big can Apple get?
Posted on 30. Jan, 2012 by Insider Monkey.
Guest post by: Insider Monkey
We have been urging investors to focus on high dividend stocks for the past year. The problem is, most people don’t know how to time the market. Dividend-yielding stocks are valued like any other stocks, and, like other investments, when they are undervalued is the best time to buy. We used price-to-book and price-to-earnings ratios to pick the most undervalued stocks.
Here is a list of high-dividend yielding stocks (at least 7% dividend yield) that have P/B ratios less than 1.2 and forward P/E ratios of 10 or less. Most of these stocks are foreign stocks which shouldn’t be very surprising. We think the crisis in Europe is overblown and both European banks and telecom stocks are undervalued right now. We know that most dividend investors are conservative investors but we believe this is a great time to at least initiate a small diversified position in the European stocks that nobody wants to own.
1. France Telecom (FTE) is a mobile operator which provides internet access and telecommunications services in Europe. The company has a market cap of nearly $40 billion. The stock offers a dividend yield of 13%. It’s currently trading with a forward P/E of 8.35 and a P/B ratio of 1.1. FTE lost 17% last year. France Telecom isn’t a popular stock among the 350+ hedge funds we are tracking. The only hedge fund with a position in FTE was Two Sigma Advisors.
2. Annaly Capital Management, Inc. (NLY) manages a range of real estate related investments. The company has a market cap of $16 billion, a dividend yield of 13.8%, a forward P/E of 7.22, and a P/B of 1.01. NLY returned in line with the market during 2011, returning 2.5%. Many hedge funds were buying NLY last year. Bill Miller’s Legg Mason Capital Management had more than 7 million shares of NLY during Q3. Some famous hedge fund managers also invested in NLY include D. E. Shaw and Cliff Asness.
3. Banco Santander, S.A. (STD) offers a range of financial products to European countries, Latin American countries and the United States. It has a market cap of $66 billion and a dividend yield of 11.12%. It trades with a forward P/E of 4.83 and a P/B of 0.63. The stock lost 23% in 2011. Ken Fisher was a huge fan of STD last year; he had nearly 29 million shares of STD at the end of September. Jim Simons and Bruce Berkowitz picked STD during the third quarter, each initiating a new position.
4. Telefonica, S.A. (TEF) is a $79 billion market cap company that provides telecom services in Spain, the rest of Europe and Latin America. It offers a 7.67 forward PE ratio, a P/B ratio of 1.13, and a dividend yield of 12.22%. The stock lost 17% last year. Jim Simons’ Renaissance Technologies is a fan of TEF. The fund had over $46 million in the company at the end of September after increasing its position by 373% in the third quarter.
5. Telecom Italia S.P.A. (TI): Telecom Italia S.P.A. is a company based in Italy that operates in the telecommunications sector. It lost 12% in 2011. The stock has a market cap of $18.3B, offers a dividend yield of nearly 8%, is priced at a forward P/E of 6.33, and has a P/B ratio of 0.62. Jim Simons was a fan of TI last year. Steven Cohen and Israel Englander also had very small positions in Telecom Italia.
6. VimpelCom Ltd. (VIP) VimpelCom is a group of integrated telecommunications services operators. VIP has a dividend yield of 7.68%. It also has a forward P/E ratio of 7.74 and a P/B ratio of 1.09. It has a market cap of $13.4 billion and lost 33% during the past year. D. E. Shaw had 1.37 million shares of VIP in his portfolio, according to Q3 filings. Louis Bacon Moore sold his fund’s $13 million position during the third quarter.
Posted on 17. Jan, 2012 by Wilensky.
Oil markets see a bit of a boost from France’s push toward cutting the grace period before implementing a ban on Iranian crude in half, breaking a 4 day loosing streak.
Jan. 17 (Bloomberg) — France is pushing for faster enforcement of the European Union’s proposed ban on oil imports from Iran, two officials with knowledge of the matter said.
France wants the embargo to be delayed by no more than three months to allow nations including Greece, Italy and Spain to find alternative supplies, according to a French government official, who declined to be identified, citing state rules. While France is seeking a shorter exemption for existing crude purchase contracts, a six-month delay favored by more EU nations remains the more likely compromise, said the second person, an EU diplomat, who also asked not to be identified because the talks are confidential. Both officials spoke yesterday.
EU foreign ministers are scheduled to decide on the ban, which will probably also include an exemption for Eni SpA, Italy’s biggest oil company, at a Jan. 23 meeting. The embargo requires unanimity among the bloc’s 27 states. Iranian officials have threatened to block the Strait of Hormuz, through which almost 20 percent of the world’s oil flows, if exports are curbed.