Il Donald e mobile

Qual plume al vento

Muta d'accent

E di pensiero.

Finally, Trump admitted he had lost the election Sunday but then reversed himself with new unsustainable claims of fraud. Alas, this is not Rigoletto but a song sung by my country's president.

There is more good news on the virus front, this time from Moderna whose vaccine maybe even more powerful and which can be kept in a normal refrigerator. Fifteen Pacific Rim countries agreed on a trade deal in Hanoi, including all the majors, China, Japan, South Korea, Australia, and Indonesia, plus mini- markets gaining global reach. The US is not a member of the Regional Comprehensive Economic Partnership. The price of oil rose thanks to the latest vaccine and another Opec deal.

So Wall Street is in buyer's heaven again. I still have more than $100,000 in cash as I think politics matter. Today we start off with a stock purchase to sop up some of that dough. My pick is highly volatile and pays no dividend, a speculative stock.

Tech & Tel

*Our ADR to buy is Trip.com Group, TCOM, formerly Ctrip.com International, a high-risk play on traditional and business tourism revival. So far this has mainly been confined to China. It is an institutional favorite owned by many fund managers globally, with T. Rowe Price the largest US investor. The ADR was underwritten by former Merrill Lynch (now BofA). Like many older Chinese plays it is incorporated in the Cayman Islands but run from Shanghai. TCOM is heavily indebted but if you haven't noticed yet, debt is cheap now. So far its performance has improved thanks to the Chinese tourism revival boosting revenues from hotels and individual business travel bookings. However, packaged group travel has yet to recover in other regions where the virus rages.

TCOM's last two quarters showed negative earnings of $1.27 and 11¢ per share. Earnings however fell a lot between the March quarter (its Q1) level of $669 mn and June's $448 mn.

Value Line expects that TCOM will shift more to higher-end deals with upscale hotels for which it can offer bookings. Its analyst forcasts a 20¢ positive eps for the Sept. quarter and revenues of $775 mn, figures penned before the current vaccine news. Charles Moran, CFA, expects that it will gain market share from larger Western rivals over time.” Asian markets are becoming more accessible to locals. My South Korean hairdresser went to Bangkok in the last quarter and hasn't stopped talking about it.

With the virus, TCOM developed a new internet program offering heavily discounted trip plans for US individual buyers at discounted prices, “Live for Trip”, which combines air travel, hotel bookings, and destination packages. This program is likely to really take off with a vaccine. I put in a limit order for TCOM at $34.175 and it was executed. The stock is now cheaper.

*Vodafone, a more traditional tech, British but operating in Europe and Africa, reported mixed results in euros for its fiscal first half but mostly beat according to Dow-Jones. IIt rose 4.4% at the open but is now ahead 5.12%, mainly because it reiterated its full-year forecast of adjusted cash flow (earnings before interest, taxes, depreciation, and amortization) of euros 14.4 bn to 14.6 bn. It expects free cash flow to top euros 5 bn. It also reported improved customer loyalty (not flipping carriers) and a euros 785,000 boost in its cable TV broadband buyers. The main reason for the rise in VOD however was cost control: cutting surplus spending by euros 300 mn, shutting unneeded retail stores by offering on-line services now covering 64% of its customers. Digital standardization helps clients traveling between VOD countries and also cuts its costs, as it gears up for 5G.

The bottom line was EPS (both GAAP and non-GAAP) at 4 euro cents, revenues at euros 21.43 bn, down 2.4% y/y, and an adjusted EBITDA of euros 7 bn, beating the consensus forecast of 6.92 bn. It also declared an interim dividend of 4.5 euro cents payable Dec 18.

It also did deals to boost its cellphone share, with NOS in Portugal; John Malone's Liberty in Germany (saving euros 250 mn there); one with ASDA (owned by Walmart) in Britain; a towers deal in Greece; sales from its Africa (listed sub) Vodacom up 7.7% but now facing a delayed spectrum auction; and claiming a 5G technical lead, which I cannot prove. It plans to copy its sale of cell towers in Greece with one in key market Germany covering other European sites. The major negative is in Italy where it is trying to work with Poste e Pay and is facing heavy unanticipated costs.

*Qualcomm got US permission to supply stockpiled 4G mobile chips to Huawei of China, but not 5G. We bought QCOM because of its venture fund investments in Israeli unlisted start-ups which paid off.

*US-Israeli Tower Semiconductor, TSEM, is up 1.5% on Pacific Rim trade and economic recovery.

*Canada's CAE pilot trainer, from Patti the Biotech Maven, is our top performer today, up 4.94%.

*South African Naspers NPSNY fell nearly 2.8% today following Tencent over Xi Jinping risks. Remember that it owns lots beside TCEHY. Its Prosus Dutch arm will run a $5 bn buyback plan. Today's drop is because of fear it will be taxed but spinoffs are usually tax-free here, if not in South Africa.

Pumping and Mining

*Once again the fact that economic recovery depends on existing energy sources and metals has boosted our oilpatch plays, Schlumberger Ltd (SLB up 6.2% at the open), Royal Dutch Shell B (RDS-B up 5.84%), and BP plc (BP, up 4.4%.)

*Nio, the Chinese electric vehicle stock initially fell but now is in the plus column. However Canadian Solar, CSIQ, is back in the red.

*HMLP, Hoegh LNG Partners LP, run by Norwegians in Bermuda, no longer covered by Barron's as a listed preferred stock, is up 1.6% today ex-dividend. It was picked by Gen Joe Shaefer but neither of us wake up in time for Norway reporting.

*Algonquin Power & Utilities was downgraded to underperform by BofA-Merrill and fell 1.1% here to $15.72. AQN is rated outperform by RBC and strong buy by Raymond James. It reported on Nov. 12.

*Antofagasta, ANFGF, is up 3.63% in London where this Chilean has its primary listing. Copper is up.

*As long as Trump's tantrums continue the price of gold will rise and the dollar fall. Like today.

*Writer Tim Worstall warns that the new Chilean constitution just voted in may require that SoQuiMich which Pinochet handed over to his son-in-law may be renationalized.

Financials

*Thanks to Scottish links, Scotiabank bought Chile's Royal Bank of Scotland arm. BNS gained 2.6%.

*Finnish Sampo Oiy has completed the acquisition of Hastings Group PLC in the UK which will become a SAXPY sub as of today. Nordea NRDBY which has no ADRs is presenting Nov. 18 at the Deutsche Bank ADR presentation. It is being spun off by to shareholders SAXPY at the urging of UK Elliott Advisors which wants Sampo to become a pure insurance firm.

*Hong Kong-based AIG Asia, AAIGF, rose. It already is a pure insurance firm.

*Banco Santander gained again hitting $2.79 at the open. Financials are winners from normal health. SAN rose despite BBVA selling its US operations to PNC for $11.6 bn. SAN already has a US network.

*Japanese Sumitomo Mitsui Finance SMFG is up over 3%.

*Panama's Banco Latino-Americano de Comercio Exterieur, BLX, rose because of heavy buying after the new Pacific Rim free trade deal and hopes for a Biden Administration.

*Xinyuan Real Estate (NYSE-XIN sold) issued RMB900 mn ($136 mn) in 5-yr Chinese corporate bonds yielding 8.35%, hardly cheap money. What will Xin Jiping do next? He's worse than Trump!

Pharmaceuticals

The drug sector is mostly lower as investments shift to the jab-makers like Moderna MRNA, up 8.4%. This too shall pass. The only exceptions are US drug firms doing well against cancer and arthritis.