Author Archives: Scalper1

5 Top-Rated Oppenheimer Mutual Funds

Founded in 1959, OppenheimerFunds currently has $204 billion worth of assets (as of January 29, 2016) under management, invested in 89 mutual funds across a wide range of categories, including equity, fixed income, alternative and multi-asset funds. With over 2,000 employees and 170 investment professionals, the company serves clients, including financial advisors, individual investors and institutional investors, across 77 countries. OppenheimerFunds is a subsidiary of MassMutual, which is one of the leading asset managers, with around $600 billion assets under management along with its affiliates. Below we share with you five top-rated Oppenheimer mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. To view the Zacks Rank and past performance of all Oppenheimer mutual funds, investors can click here . Oppenheimer Global Opportunities Fund A (MUTF: OPGIX ) primarily invests in a wide range of domestic and foreign equity securities. It focuses on acquiring stocks, but may also purchase debt securities. The fund may invest a maximum of 25% of its assets in “below-investment grade” securities or “junk bonds.” Moreover, it may invest in developing or emerging countries and in small- and mid-cap companies. The fund has a three-year annualized return of 5.6%. Frank V. Jennings is the fund manager of OPGIX since 1995. Oppenheimer Equity Fund A (MUTF: OEQAX ) seeks growth of capital. It invests the lion’s share of its assets in equity securities of domestic companies. Though the fund primarily focuses on acquiring securities of mid- and large-cap companies, it may also invest in securities of small-cap companies. Moreover, it may invest in securities of companies located in foreign lands. The fund has a three-year annualized return of 5.8%. OEQAX has an expense ratio of 0.98%, compared to the category average of 1.18%. Oppenheimer Discovery Fund A (MUTF: OPOCX ) primarily emphasizes investing in common stocks of domestic companies with solid growth potential. It invests in securities of companies having a market capitalization similar to those listed in the Russell 2000 Growth Index. The fund has a three-year annualized return of 2.8%. As of December 2015, OPOCX held 105 issues, with 2.50% of its assets invested in Bright Horizons Family Solutions Inc. (NYSE: BFAM ) Oppenheimer Rochester AMT-Free Municipals Fund A (MUTF: OPTAX ) seeks tax-exempted income. The fund invests a large chunk of its assets in securities that are expected to provide returns exempted from regular federal and state income taxes. The assets of OPTAX are not invested in municipal securities, the interest income on which is not free from the federal “alternative minimum tax” (AMT). The fund has a three-year annualized return of 4.3%. OPTAX has an expense ratio of 0.87%, compared to the category average of 0.97%. Oppenheimer International Growth Fund A (MUTF: OIGAX ) may invest all of its assets in non-U.S. companies with impressive growth prospects. It invests more than 65% of its assets in common and preferred stocks of companies located in at least three different countries other than the U.S. The fund has a three-year annualized return of 1.5%. As of December 2015, OIGAX held 106 issues, with 1.78% of its assets invested in Continental AG ( OTCPK:CTTAY ). Original Post

Investment Opportunities Flow From Water Initiatives

By Sherree DeCovny Large parts of the world are running short on water – even experiencing “desertification” – at an alarming rate. Innovative solutions being implemented by the public and the private sectors may offer interesting opportunities for investors. Several factors are driving water shortages. Climate change could have the greatest global impact. Some projections have temperatures around the globe warming by three to four degrees (Fahrenheit) over the next century, which would affect water in many ways. Some areas would stay the same, but many others would be either flooded or stricken with drought. Population growth is also putting pressure on clean surface freshwater resources in lakes and rivers. Brackish water must be treated before it is used for human consumption, and groundwater is harder to use because it must be pumped. According to Julie Gorte, senior vice president for sustainable investing at PAX World Management, 96.5% of all the water on Earth is brackish and 1% is saline. Only the remaining 2.5% is fresh, and of that, 1.2% (0.03% of all water) is surface fresh water. Of the surface fresh water, 30% is groundwater, and 69% is currently locked up in glaciers and icecaps. The more fresh surface water is used, the more it becomes contaminated. Industrial use is a major issue. For example, hydraulic fracturing, or “fracking,” takes about 5 million gallons of water to frack a well once. The water becomes highly contaminated, and treating it is extremely expensive. Some countries with large populations are experiencing drought conditions, yet much of their water is contaminated. About 60% of China’s groundwater – which makes up about one-third of the country’s water resources – was rated unfit for human consumption by China’s Ministry of Land and Resources. In India, 80% of sewage flows into rivers without being treated, according to a 2013 study by the Centre for Science and Environment. Accessing water in underground aquifers is also a challenge. Boreholes can be neglected for years or can be vandalized (sometimes as a result of war). In such cases, wells need to be rehabilitated. In other cases, springs are unprotected, which allows the water to become contaminated. Many communities lack the financial resources to hire engineers and well drillers with the expertise to access and protect the water. Where water is accessible, commercial applications, such as farming, often deplete the supply. Finally, the availability of ongoing service and support for communities that have previously benefited from safe-water projects is an important consideration. “For every community that receives first-time access, another community somewhere else is losing the access they once had because of lack of maintenance or continued investment in their water system,” says Stan Patyrak, vice president of strategy and development at The Water Project. Innovative Solutions In developing countries, not-for-profit organizations, such as The Water Project, collaborate with local organizations to help improve their capacity to provide sustainable water and sanitation projects. The Water Project’s programs in sub-Saharan Africa focus on water delivery and service, community engagement, hygiene, sanitation training, and ongoing monitoring. Programs sometimes use outside (private sector) hydrogeologists, engineers, and consultants. Moreover, local businesses supply spare parts and provide ongoing maintenance. Drilling and repairing wells, building dams, protecting springs, and harvesting rain are often the easy part. The main challenge is keeping water flowing. People from the community, local and national governments, and the private sector all have a role to play. In developed countries, public authorities are addressing the problem through cultural change and technological innovation. Consider the example of Las Vegas. Of 280 major US cities, Las Vegas ranks at the bottom of the list in terms of rainfall, which may explain why it is one of the most water-efficient cities on Earth. Its public authority has taken steps to protect the availability of fresh water by regulating where grass can be put on golf courses, for instance, and what kind of water can be used in fountains. In the US, California is a case study for drought. In some municipalities, especially near coastlines, salt water is intruding into the groundwater. If too much fresh water is being taken out of the groundwater, sea water will seep in and make the groundwater brackish or saline. It then cannot be used for agriculture, drinking, or hygiene without treatment. One potential solution frequently used in the Middle East is desalination; the problem with this process, however, is that it is not environmentally friendly. Desalination plants suck water from the ocean, put the contents through a reverse osmosis process, and then dump the briny waste back into the ocean. Desalination is also energy intensive and reliant on fossil fuels, although companies are starting to use solar energy and wind to power the plants. In California, WaterFX will soon open the first commercial solar-powered desalination plant. The modular technology is located right where it is needed, in this case in the Central Valley – the heart of the state’s agriculture. Rather than processing ocean water and then transporting it inland, the company recycles unusable, salty drainage water from irrigation into potable water for use by local water districts. “Amazingly, this process changes farmers from being huge water consumers into water producers. They can actually get paid for their water,” says Rona Fried, CEO of SustainableBusiness.com. “And the resulting clean water costs about the same as what farmers pay today, much less than water desalinated from the ocean.” Other methods are being used to minimize the amount of water used in agriculture. Drip irrigation alone can reduce water usage by 20%. Software and sensors allow farmers to track moisture levels in the soil (minimizing irrigation), and drones are beginning to be used to monitor soil conditions from above. Farmers will likely switch to crops that match their local water conditions. California is turning to other innovative solutions as well. Orange County is implementing artificial groundwater recharge systems, which route surface water back into the groundwater, as well as using treated wastewater for such purposes as drinking and agriculture. Los Angeles recently dropped 96 million “shade balls,” which float on water and block sunlight, into a reservoir holding 3.3 billion gallons of water, thereby reducing evaporation and making the water less susceptible to algae, bacterial growth, and chemical reactions. Investment Opportunities As US water and sewer systems deteriorate, an estimated $1 trillion in new investments will be needed to rehabilitate water infrastructure over the next 25 years, according to the American Water Works Association. Further, the American Society of Civil Engineers estimates that the cumulative capital investment gap for US water infrastructure will rise from $100 billion in 2015 to nearly $200 billion in 2040. “The massive amount of investment required provides an opportunity to invest in municipal securities over the next 20 to 30 years,” says Zareh Baghdassarian, municipal and corporate credit analyst at NewOak Capital. “Four of the top five issuers – California, New York, Florida, and Pennsylvania – offer domestic investors a double tax-exempt status on returns, and the issuers have high credit ratings.” For example, the Los Angeles Department of Water and Power’s municipal bonds (5s in 2044) yield around 3.5%, which equates to almost 8% when the double tax exemption is counted. Municipalities have contracts with regulated utilities that provide water to residents and treat the water. Water utilities are public companies, so investors may trade in their stocks and bonds. In addition, they can invest in public companies – which supply the industry with pumps, pipes, filtration and treatment systems, and other technology – as well as water-related technology companies, such as biotech firms. It is also possible to make private equity investments in small companies that are innovating in this space. Of course, because smaller companies have different financial characteristics than larger public ones, returns may be more volatile. Another recent development comes for the exchange-traded fund (ETF) sector. The PowerShares Water Resources Portfolio ETF (NYSEARCA: PHO ) is based on the NASDAQ OMX US Water Index. The constituents of the index are selected by Rona Fried (CEO of SustainableBusiness.com). She first looks at how much of the company’s revenue is driven by water solutions, shooting for a minimum of 50%. Companies that are considered leaders in the industry may also be included, even if water is not their dominant product. She then looks at how a company runs its water business from a sustainability perspective. For example, do wastewater treatment companies use chemicals to treat water, or are they using advanced technologies that treat water biologically? Are they improving the energy efficiency of their plants and incorporating water recycling and/or bio-gas? As Gorte points out, investors hoping to earn a return need to keep in mind that any company, security, or idea is capable of underperforming depending on economic factors and the financial/business cycle. Some industries are more cyclical than others. Utilities tend to have less cyclical volatility, and technology companies may be more volatile. Ultimately, Gorte believes investors should look for well-managed companies. “There’s a lot of innovation in how to move water around and treat it and make it available more efficiently with less loss,” she concludes. “That’s a nice, long-term secular growth prospect.” Sherree DeCovny is a freelance journalist specializing in finance and technology. This article originally ran in the November/December 2015 issue of CFA Institute Magazine . Disclaimer: Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

CyberArk, FireEye Q4 Sales Expected To Brake; But Stocks Rebound

CyberArk Software ( CYBR ) and FireEye ( FEYE ) stocks lent themselves to a security recovery Wednesday, both climbing ahead of their late-Thursday quarterly earnings reports after a four-day downtrend pounded IBD’s Computer Software-Security industry group. The 26-company group rose 1.7% Wednesday after hitting a one-year low on Tuesday, with shares of Qualys ( QLYS ),  Imperva ( IMPV ) and Proofpoint ( PFPT ) leading the way, up 15.2%, 6.3% and 5.6%, respectively. CyberArk stock rose 2.3%, while FireEye stock jumped 3.7%. Still, the Computer Software-Security group ranks a mere 176 out of 197 groups tracked by IBD. But CyberArk and FireEye are expected to report sales, for Q4, that will have decelerated for their third- and sixth-consecutive quarters, respectively. CyberArk EPS Seen Falling For Q4, the consensus of 15 analysts polled by Thomson Reuters sees CyberArk reporting $43.9 million in sales and 20 cents earnings per share ex items, up 21% and down 5%, respectively. It would be the first time in six quarters that CyberArk’s earnings have fallen year over year. Three months ago, CyberArk guided to $43 million to $44 million in sales and 18-20 cents EPS minus items. CyberArk is expected to report a 49% year-over-year jump to $153.3 million in sales for the year. EPS is seen climbing 53% vs. 2014 to 81 cents. CyberArk previously guided to $152.3 million to $153.3 million in sales and 80-82 cents EPS minus items. Will FireEye’s Billings Recover? FireEye is expected to report $185.3 million in Q4 sales and a per-share loss ex items of 37 cents. On a year-over-year basis, sales would grow 30% and losses would shrink by a penny. In November, FireEye guided to $182 million to $190 million in sales, 36-38 cents per-share losses minus items and $240 million to $260 million in billings, which for the latter would be up 18% at the midpoint. For 2015, the consensus of 34 analysts polled by Thomson Reuters expects FireEye to report $623.4 million in sales, up 46%. Losses per share ex items of $1.62 are expected to lessen from $1.97 in 2014. The company previously guided to $620 million to $628 million in sales and losses per share ex items of $1.61 to $1.63. Billings guidance for $780 million to $800 million would be up 34% at the midpoint.