THE BULL MARKET REPORT for June 27, 2016

by Todd Shaver | Jun 26, 2016 | Weekly Newsletter 7pm Sunday

THE BULL MARKET REPORT for June 27, 2016

Brexit: Shock and Awe
Two weeks ago in The Bull Market Report entitled Summer Calm, we mention how it would take something really big to move the market.  Well Friday, that something happened.  British citizens expressed their desire to exit the European Union (EU). Global markets were caught totally off guard.  Before the markets around the world even opened Friday morning, S&P 500 Futures had dropped nearly 6%.  The financial markets around the world collapsed to kick things off and by the close on Friday, all three major US market indices had fallen on the day by more than 3.5%.  Every S&P industry sector except Utilities was in the red by the day’s end.  

The only clear cut winner on Friday was the US dollar and Gold.  The British Pound hit a 40-year low following the Leave victory, falling more than 8%.  The rush into the dollar drove fixed yields down.  The US 10-Yr. Treasury Note dropped as low as 1.4% during the day, closing at 1.58%.  Crude, being priced in dollars was under continuous selling pressure before bouncing off its $47 low for the day.

In all, it was a five-day rollercoaster ride with early week optimism for a Brexit STAY victory giving way to complete shock and awe at the end.  Public opinion polls completely missed it; they weren’t even close.

Here is How The Major Averages Performed For The Week:

Time For Some Perspective and A Strategy
Conventional investment wisdom holds that where the greatest uncertainty exists, the greatest opportunities are to be found.  As the US markets opened on Friday, uncertainty was at its peak.  Everywhere people wondered what would happen next.  It was not a pretty day anywhere in the world.

In the Treaty on European Union (TEU) a quick look at something called TEU Article 50 will help shed some light.  Under the terms of this provision a European Union member country can withdraw only after negotiation and approval of the European Parliament.  This could take as much as two years.  With Prime Minister David Cameron having resigned on Friday, with new UK elections pending, who knows how long it may take for the Brits to file for Article 50.  A good guess is two-three years for the whole process to unfold.  A lot could happen during this period.  The EU could make a counter offer or make other appeasements to maintain British membership. (Plus this just in: there is a recent movement to have another vote on Brexit in the UK. Three million people have signed petitions.)

The speculation now shifts to the remaining EU countries.  Will there be others that look to make an exit?  (There is talk in France now – Frexit.) Others have been named as well:  the Netherlands, Austria, Finland and Hungary. Will the Euro survive as a currency if this happens?  Will a falling Euro create a financial crisis in some of the weaker EU economies?  These are some of many questions that will be debated endlessly in the months ahead.  Since this is a political process, and politics moves at its own glacial pace, the answers will be slow in coming.

Meanwhile Back At Home
Let’s take a breath and look at the immediate implication for US markets.  Gold and the dollar are in high demand as safe havens.  The US offers a positive yielding bond market and economic strength.  Plus, Brexit puts any doubt to rest about future US monetary policy: There is zero likelihood of an interest rate increase this year.  We have suggested repeatedly how global forces, not the FOMC are in charge of policy.  Last Friday showed us a perfect example.

All this means that money flows still favor US stocks.  But not all stocks.  Strength of the dollar for multinational companies translates into lower foreign earnings.  A higher valued dollar raises the cost of Crude, cutting into global economic growth.  Finally, foreign trade outcomes are going to depend on Europe but we can’t forget about Chinese monetary policy either.  If Beijing does not realign currencies, US exports will get hammered.  The higher dollar is great for US inflation but not for the trade deficit.  

Invest In The USA
So a picture emerges that favors US companies with either a major domestic concentration in businesses like services (Healthcare, Real Estate, etc.), or those that import manufactured components or finished products (Technology).   Uncertainty creates demand for precious metals and the Brexit vote supplies plenty of this.  Companies with little debt and great cash flow characteristics are more valuable now than ever.  A quick look at fixed income yields will get us up to date.

In the aftermath of the Brexit vote, 10-year US Treasury note yields reached the lowest level since 1962 of 1.42%.  This makes high cash flow, dividend paying companies the obvious choice of investors seeking income.  It also shines a special light on certain financials like REITs where payouts are well above the average S&P 500 dividend yield of 2.1%. (See table below: Superior Dividend Yields)

The Bull Market Report Company Commentary:
Barrick Gold (ABX: $20.50, up 1.8% on the week) When in doubt, buy Gold.  Not just the metal, buy Barrick.  Here is why.  We added the stock to our Special Opportunities List in February at $11.69.  Since then it has added 75% in value.  For the record, buying Gold (the metal) over the same period would have resulted in a gain of 18%.  So give yourself high fives, you made a good decision and we hope we helped you in that process.

Barrick is doing better than most because it is hunkering down, ridding itself on non-core assets ($3 billion so far), getting a good handle on operating costs and making some overly conservative assumptions on the price of gold ($1,000 – it’s over $1300 now).   

No wonder Wall Street expectations have been rising over the past 60 days.  Consensus earnings for 2016 is $0.56 per share, nearly double the $0.30 earned last year. As for 2017, EPS are estimated as high as $1.20.  Barrick Gold is delivering riches to investors and there is more to come.

Adeptus Health (ADPT: $49, unch.)  Adeptus Health is a purely domestic service company so it fits our strategy perfectly.  OK, but what is wrong with the stock lately?  Since reaching a 2016 high of $72 back in early May, it has been tumbling to current levels.  The single most obvious contributor to this was the registration of 2.7 million in stock through Goldman Sachs earlier this month.  The choice of Goldman is a gold plated seal of quality on the Adeptus offering.  However, it has led to serious indigestion in the market.  This was not one of Goldman’s picture perfect underwritings.

Over the past 90 days, consensus estimates for 2016 have risen from $2.47 to $2.63 and for next year from $3.52 to $3.84.  This is all good.  On June 9, senior management appeared at Goldman’s Annual Global Healthcare Conference. Our sources tell us, the Adeptus presentation was a big hit.  

2Q16 earnings release is still about a month off on July 20.  At this time, the seven faithful Wall Street analysts following Adeptus, estimate a 37% rise to $120 million in revenues and a 30% gain in EPS to $0.57.  These are fantastic numbers but the rate of gain will be even better as we get into the second half of this year when a number of new Emergency Centers are up and running.  A year from now, we will look back on the current stock price and wonder how it ever got this cheap.

Celgene (CELG: $96, down 2%) Early next week we will be adding Celgene to our Opportunities in Healthcare portfolio.   Some 25% of the business is from Europe so there will be some currency issues to deal with.  This is only a minor issue however when considering the US pipeline is about to explode with important new cancer drugs.

Immuno-Oncology is the science of stimulating the human immune system as a means to attach and kill cancer cells.  Celgene is the third largest in the area behind Roche (RHHBY)* and Novartis (NVS)*, but much faster growing.  Almost all it revenues come from this source, so this is virtually a pure play on Immuno-Oncology.  
* Note that both of these companies have a market cap of close to $200 billion.  Celgene is at $75 billion

Celgene has a huge new products pipeline including 18 in Phase III trials.  Per share profits were down 19% to $1.94 last year as spending on R&D jumped 50%.  But that will pay off in the long term as the pipeline produces the next Celgene blockbusters.  The short run outlook is bright also.  Management is guiding EPS for this year to $5.75, nearly three times last year’s level.

With the stock well below its 2015 high of $141 and selling at 17 times estimated 2016 EPS, the stock is a real solid value.  It is time to get invested. (Again, look for the full research report early this week, delivered via News Flash.)

Visa (V: $75, down 2% for the week) Visa has been called the world’s largest non-financial financial company.  Interest rates mean little to Visa.  The key is the growth of commerce.  A tiny slice of every credit card transaction using the Visa card goes into company coffers.

It might be argued that the ripple effect of Brexit will slow retail commerce in Europe and that would be bad for credit transactions.  This sort of thinking was quite evident on Friday with the stock falling over 4%.  Here is why we disagree.

Last week was a busy time for the world’s largest payments processing company - the company completed the acquisition of Visa Europe for $24 billion in cash and stock.  Visa Europe revenues are about $1.5 billion.  Over the past 5 years Visa Europe revenue has grown at a 13% annual pace and profits by 10%.  The combination of the two companies will produce a 10% boost to consolidated annual revenues and 5% to profits.  

The acquisition will enable Visa management to improve the speed in deploying new technology and the opportunity to increase the rate of growth in EU countries.

In Europe an estimated 37%, or $3.3 trillion, of personal consumption expenditure is still done in cash or checks so there is plenty of room for growth here.  Europe has also been an early adopter of mobile payments, which will see strong growth in the future given the widespread availability of Near Field Communication technology (the technology used in Apple Pay, etc.)

Last week was also the switchover by Costco (COST: $156, unch.) from American Express to Visa.  Costco customers will now pay with cash, debit or Visa card.  With revenues of $116 billion last year, the average Costco purchase is over $100 and that means Visa credit cards will receive the vast majority of all transactions.  Visa gets a tiny slice of each transaction but when you add it all up it could amount to over $250 million a year, a tidy 2% bump in 2015 Visa revenues.

Since the stock was added to our favored list on February 9th, it has appreciated 7% making it one of the top performing financial stocks during this time. It is a solid stock that just keeps moving ahead.

The Search For Income
As the dollar appreciates and bond yields continue to erode, investors in search of income can find an answer in the list below.  Here are nine companies on our favored list that offer superior yields.  We like them for their price appreciation potential as well.  There is some real quality here to choose from.

The Bull Market Report

Superior Dividend Yields

Upcoming US Economic Data
All eyes will continue on Europe and the United Kingdom this week and for many more that follow.   On the US side, Wednesday is the key day where personal income, spending and inflation will be featured.  The Case-Shiller home price index for April is due out on Tuesday.  This forecast was not available as of Friday’s close of business but our estimate is for a price rise of 4%.  Supply shortages in major real estate markets continue to push prices to record levels especially in East and West coast regions.

Well, as you get ready for this week, remember to keep a cool head.  Our sole purpose this week was to offer a strategy to view what is happening now as an opportunity.  Once this period passes and stocks move higher, we will be glad we took action.  In the meantime, we hope you have a truly rewarding week.

Options Corner
Well – Out of all of our readers only ONE PERSON caught my mistake last week when we discussed selling calls on Twitter.  (I knew it was a mistake – I was testing you…  Just kidding.) Here is his email to us:
From: Michael Saidis
Sent: Sunday, June 19, 2016 8:49 PM
To: info@bullmarket.com
Subject: New Message From BullMarket.com - Contact The Bull Market Report

“Re your covered call example with TWTR , I think you operated a little fast & loose with the math .... basically subtracting $2 premium from cost as well as adding it to proceeds ..... nice try.”

Thank you Michael.  Let’s try this again.  Twitter (TWTR: $16.44) had a good week, too.  It was up 2% for the week, but WAS up 6% for the week until Friday.

Let’s say you want to do a covered call on Twitter because you think it can move to the $18-20 level by the end of the year.  You could buy 1000 shares at $16.44 and sell the January 18 or 20 call.  The $18 call sells for $2.00 and the $20 for $1.40.  Let’s say you sell the $18 call for $2. This would give you $2 of downside protection, so your breakeven on the downside would be $14.44 a share. Note though, that if the stock goes higher than $18 you would not participate in anything above $18.  So if the company were to be bought out at $20 or $22 or higher, you would not participate in anything over $18 - your profit would be capped at $18.  Still not a bad return: A $14.44 investment; sale at $18.  That’s 25% in seven months.  

More Commentary on Bull Market Report Favorites
Under Armour (UA: $37) was upgraded by analysts at Buckingham Research from a "neutral" rating to a "buy."  We are big believers in Under Armour.  They are on the cutting edge of the athletic apparel market, also including running shoes and other types of athletic shoes.  We added the stock to our Stocks for Success in January at $40 and we certainly aren’t happy with the performance so far, but we are sticking with this one for the long haul.  We feel it is only a matter of time before they start to be accumulated by the smart money on Wall Street.   

SURVEY: Results of our informal survey of the SIZE of the type in The Bull Market Report newsletter: We got about 20 responses and 19 of them voted for the larger font.  Here is a comment from Ron Shack: “Larger is better for these old eyes.”
So we are sticking with the way we have been doing it.
If you have any other issues, feel free to write us at Info@BullMarket.com.

Sprouts Farmers Market (SFM: $22, down 67 cents for the week – 3%) Sprouts reported earnings on May 5th. In an otherwise strong quarter, the company said revenue improved 16% to $990 million, short of estimates of $1.0 billion. Comparable same-store sales were solid, increasing 5%, and earnings per share improved 20% to $0.30, better than the consensus by a penny. The launch of 365 by Whole Foods Market emerged as a potential threat to Sprouts as the lower prices at 365 are more in line with Sprouts. We remain steadfast on this one.  We think they’re doing just fine and the stock should rebound as the summer moves on.
 
Tesla Offers to Buy Solar City.  Elon musk of Tesla (TSLA: $193, down 10%) thinks having Solar City (SCTY: $22, up 4%) in his stable will produce extraordinary benefits in the future.  We were quite upset about it when we heard the news but as time has calmed our passion we our having some new thoughts.  The initial reaction on the Street was positive as we saw the stock move to almost $24 on Wednesday.  (Big deal – the stock was at  $35 April 21st, a month ago.)  The follow-on reaction was negative, very negative.  Here are some statements from analysts:  
“We believe shareholders could be concerned about the transaction given Elon’s ties to both companies.”
“We believe investors are likely to view this transaction as a bailout for SolarCity and a distraction to Tesla's own production hurdles.”
“Little in the way of synergies, much in the way of cash burn.”
“We expect this to be a challenging acquisition given the integration of two different types of companies and cultures.”
There were a few positive statements; here’s one:
“The deal is consistent with the long-term strategy of both companies.”

But some analysts are now changing their tune and blessing the merger and the future.

Musk himself said that Tesla could be a trillion-dollar company one day, despite its current market value being less than 3 percent of that figure.
"I have no doubt about this - zero," Musk said on the call with analysts and investors before markets opened on Wednesday. "We should have done it sooner."

BMR Take:  We were quite upset about this deal last week as we wrote to you in our News Flash.  It turns out that the market didn’t like it either.  It’s a done deal now (unless it unravels) so we are more accepting of it now.  We believe in Musk.  He is a lot smarter than we are, so we are going to stick with Tesla and trust that he will be able to pull this off.  But note that Tesla is a risky investment.  New car company success stories are few and far between. Be wary.

ENERGY STOCK SALES REACH A RECORD
The Wall Street Journal reported that Denver-based driller QEP Resources and Canada’s Birchcliff Energy announced offerings late on Tuesday that brought to more than $20 billion the total in North American oil-and-gas company share sales this year. That figure tops the record of $19 billion raised in follow-on stock offerings (where already-public companies sell new shares) for oil-and-gas producers for all of last year. The share-sale activity, coming with a rebound in oil prices, shows investors’ faith that crude prices won’t falter again. QEP (QEP) is a $3.7 billion market cap company. The stock hit $35 in 2014, and just bounced off its low of $9 earlier this year to its present $17.30.

Also, many of the companies selling shares lately are using the cash to acquire land. QEP raised $370 million, and now the company says it is buying about 9,000 acres of Permian Basin drilling property in West Texas for about $600 million. The price per acre is around $60,000, a new high in that area, almost double recent prices. Some said that QEP’s Permian acquisition represents one of the highest, if not the highest price paid for such assets, and suggested the company may be overpaying to boost its holdings there. Looks like speculation is back in the oil business.

Other Energy News: Saudi Arabia has declared an end to its oil war with the US
Two years after declaring war on US shale oil production, Saudi Arabia says the need for the fighting is over. Saudi Arabian energy minister Khalid Al-Falih said that the worldwide oil glut has vanished, signaling an end to Saudi Arabia’s strategy of flooding the global market with oil to try to put American drillers out of business. A three week long resurgence of US oil drilling after 21 months of decline suggests that Saudi and the US fought to a draw rather than  “victory.”

Falih noted that a record volume of oil remains in storage in the US and around the world built up during the glut, but once much of that is sold off, the kingdom can resume its traditional role managing supply and demand.

“We are out of it,” Falih said. “The oversupply has disappeared. We just have to carry the overhang of inventory for a while until the system works it out.”
The Saudis went to “war” in the summer of 2014 after a sudden, 4-million-barrel-a-day surge in US shale oil production. The Saudis saw that the OPEC oil cartel was losing its four decade long influence over global oil prices. So, they decided to destroy US drillers by flooding the market and forcing down oil prices. Russia did the same thing, and crude fell from $100 to $27 in two years.

As of the end of May, 80 North American oil companies had declared bankruptcy. The number of oil rigs in the US fell to 315 at the end of May from a peak of 1,600 in late 2014. Oil production dropped, although not as dramatically as one might think, to about 8.7 million barrels a day from 9.7 million at the peak in March 2015. But the resurgence of oil prices has resulted in a turnaround in rigs, too–last week, they rose by nine to 337, according to Baker Hughes, an oil services firm.

There is a turnaround going on as 10 new rigs went back into production, up for the 2nd week in a row, to 340. There are nearly 2,000 drilled but not completely constructed wells in the US. (Wow.) With higher prices, companies will begin to bring those into production.

Falih has been talking out of both sides of his mouth.  A month ago he said Saudi will not set price targets, but just this week he said that since Saudi is so important in the world of oil that there is no one else in the world except them to balance supply and demand.

BMR Take: It looks like nothing has changed. Investors are betting on stable to higher crude prices.  It used to be said that “As goes General Motors, so goes the country.”  That was THEN. This is NOW. Energy is big business in this country and if this resurgence holds, we are in for a stronger economy, higher stock prices and stable interest rates.  

High Yield Corner
Of course, this week’s market was dominated by Brexit, and the UK’s “surprise” vote to leave the EU. In reality, this shouldn’t be too much of a surprise. Economic stagnation across Europe, with youth unemployment breeching 50% in many Mediterranean countries, was surely top of mind amongst British voters. In addition to that, growing angst over refugee immigration, the very public and embarrassing spats between the Bundesbank and Greece, and growing talk about expanding the EU into forays such as creating a European army surely motivated a lot of people to vote to leave.

But now we are in uncharted territory, and markets hate nothing more than that. So many pundits are expecting Friday’s weak market to persist next week, with broad based declines. It’s times like this that investors need to have  strong conviction that downturns are inevitable and temporary, and that we will get back to normal eventually. This is a time to buy, not to sell.

This is true for pockets of the high yield market, but not all of it. High yield debt, as seen through the SPDR Barclays Capital High Yield Bond Fund (JNK: $35, up 0.4%) remains quite highly priced. Junk bonds are up over 3% year-to-date and over 10% from their yearly low. The positive news is that there are world-wide central bank promises to keep liquidity going, including the Federal Reserve which has basically said it probably won’t raise rates for the rest of 2016, but the high relative price of junk doesn’t mean it’s a no-brainer buy right now.

AstraZeneca (AZN: $28, up 1% for the week; down 5% on Friday) saw a correction Friday along with other British stocks, which might persist into the future. The company’s fundamentals remain attractive - the Brexit will have little impact on the company’s revenue streams, as it is diversified globally and well penetrated in America, Japan, and other wealthy nations beyond the EU. That doesn’t mean short-term fears won’t drag it down further in the coming weeks.

Barclays (BCS: $8.90, down 8%) While not traditionally a high yield stock, Barclays is suddenly a very appealing buy. Losing 20% in a day on fears that Brexit will hurt British bank profitability, the company is now paying a 4.3% yield. That yield could go down in U.S. dollar terms if the British pound falls further, but that may not happen. After falling to a 30-year low, the pound should stabilize from here.  It seems that Brexit has already been priced in, so we won’t see a dramatic change to the currency until new developments emerge.
 
Main Street Capital (MAIN: $32.80, up 1%, 6.6% yield) has so far remained surprisingly resilient against a Brexit. It had an early morning flash crash on Friday but was bought up by opportunistic traders later in the day, causing it to close almost flat from the prior day. This only proves the resilience of this stock and the market’s growing understanding of its durable value, driving us to keep holding it and enjoying the 7% dividends.

Omega Healthcare Investors (OHI: $32.60, down 1%, 7% yield). A similar story. The stock fell steeply Friday morning, but ended the day up as opportunistic investors bought. Since Omega Healthcare has little direct or indirect exposure to either Britain or Europe, there’s little reason to expect its core growth driver - an aging American population and the growing popularity of long-term care facilities - will continue to drive the company’s performance. Plus, there’s no reason to say that a Brexit will hurt the company’s UK properties - which make up less than 20% of the company’s overall portfolio.

The only real question mark for a high yield investor is what this will do to oil, and how that will impact MLPs. The Alerian MLP ETF (AMLP: $12.60, up 1%, 9% yield) took a dive Friday but remained up for the week. This was largely in sympathy with oil, as MLPs start to trade closer to the commodity. With that in mind, the headache and risk associated with MLPs makes them an asset class to avoid right now, as the reality of a Brexit might cause greater volatility in commodities than anyone can predict.

Annaly (NLY: $10.89, up 3%, 11% yield) Citi Research kept its neutral rating on the stock but they are getting more positive on the shares. They expect Annaly to generate more interest income and have lower financing costs since the Federal Reserve’s expected pace of rate hikes is slower Annaly shares are up 14% so far this year – add the dividend and you have a 25% gainer.

You know that we have loved Annaly for almost 20 years since we started The Bull Market Report in 1998.  Annaly started in 1997 and have been successful through thick and thin; through bull markets and bear; high interest rate environment and low.  How do they make their money?  They borrow from banks at 1-2% and invest in Ginnie Mae and Fannie Mae bonds and other (formerly) AAA-rated securities yielding 4 and 5%.  Leveraged 5-1 they produce 13-15% returns, thus being able to pay management EXORBITANT salaries (we HATE this), and pay out the rest, yielding 11% at the moment.  (If you can get over their salaries, then you can invest with them.  We have.)

That’s the story.  We are buyers here.  The stock could easily get to $12 in the next 12 months, so your total return would approach 23%.  If the stock goes to $10, your return would approach zero.  If it stays the same you can sit and collect the 11% dividend.

Oh, one more thing – Note that Annaly always takes a hit when there is talk of higher interest rates.  And since rates are so low, there is always talk of interest rates going up.  So take heed.  (Of course, the interest rate pundits have been calling for higher rates since 1984 (this is not a misprint – see chart just below) but obviously this hasn’t happened and is not happening now.) BUT, there is always tomorrow, so beware.  But again, management KNOWS the world they live in and can handle higher interest rates.  It is just the rest of the world the panics and sells the stock, causing it to go down.  When that has happened in the past it has always been a buying opportunity.   

http://finance.yahoo.com/echarts?s=%5ETNX+Interactive#{%22range%22:%22max%22,%22allowChartStacking%22:true}

Great Quote from Gary Jefferson to keep in mind during these volatile times:
Please remember – this market decline is a result of "uncertainty" and fear --- not fundamentals.  Earnings will eventually decide where prices end up.
BTW, the Volatility Index (^VIX: 26) was up 50% on Friday. Almost unheard of.)

Interesting Letter to the Editor:
We got a letter from Robert Jolly Thursday evening during the midst of the carnage before the market opened up Friday morning.  He said:
Hey Todd: Are we buying anything today or sitting on the sidelines until the smoke clears.

Our answer:
"Hi Robert –
"If you can tell me where the stock market is headed, I’ll answer your question for you.
"The market was in panic mode all last night.  I was up for most of it.  It was down 733 points at its lowest.  It’s down exactly 500 now in overnight trading.  So, of course, no one knows.  But the sun came up this morning and nothing really changed except of the level of the Dow.  This is a big deal, so it might be a good idea to take a breather and watch.  If the market shoots up 1000 points you’ll be upset, but you’ll be fine financially.  If it shoots DOWN 1000 points from here it could be a disaster for you.
"Am loving Annaly at the moment!
Todd Shaver"

Looking for solid companies that have gotten hammered well beyond reality?
Yes, we all are, and we preface this by saying most of this depends on the future movements of the world’s stock markets.  If the markets drop 10-20% from here, we are in deep trouble and all bets are off.  But if the world comes to its senses and things stabilize like they usually do, then here are a few overseas stocks that have been beaten up.

Deutsche Bank (DB: $14.72, down 17% Friday)  $20 billion market cap; strongest bank in Europe; 52-week high of $35; trading at 29% of book value; trading below the 2008/2009 Great Financial Crisis low.  Possible negative:  Interest rates in German are negative - the 2-year Schatz yield, the equivalent of our two-year Treasury, hit negative 58 basis points (-0.58%).

Credit Suisse (CS: $11.51, down 16% on Friday) Market cap - $22 billion.  52-week high of $30. 5.5% yield.

How about Barclays (BCS: $8.89, down 20% on Friday) $44 billion market cap.  (It WAS $55 billion on Thursday.) Yield – 3.4%.  $18.05 52-week high.  All-time high - $58 in 2007. Founded 1896; based in London.

Lloyd’s Banking Group (LYG: $3.33, down 23% on Friday).  $70 billion market cap.  Was $90 billion on Thursday.  4% yield. Founded 1695 (this is not a misprint.)

Good Investing,
Todd Shaver, Editor in Chief
The Bull Market Report