Gain and Pain

40 something Global Director of Business Development for a Security Software Manufacturer. Trading stocks for 15+ years - using primarily technical analysis
Joined Oct 26, 2011
128 Blog Posts

Gain and Pain

Joined Oct 26, 2011
128 Blog Posts

ADP & PAYX – with employment increasing let’s look at payroll processing firms

681 views

Job numbers came in at 163,000 for July, slightly less than the 172,000 jobs added in June. An improving job market is a positive sign for payroll processing firms so lets take a look at the results of the two biggest players:

Automatic Data Processing  (ADP) Q4 revenues grew 5.2% over the year to $2.64 billion, marginally shy of the Street’s projections of $2.65 billion. EPS of $0.53 was in line with the market’s targeted EPS and reported growth over previous year’s earnings of $0.48 for the quarter.

By segment, Employer Services’ revenues grew 7% over the year to $1.88 billion, with the number of employees whose payrolls were processed by ADP in the U.S. rising 3.2% over the year. During the quarter, ADP bought back 6.4 million shares of its stock at a cost of $342 million.

ADP ended the year with revenues growing 8% over the year to $10.67 billion and EPS of $2.82. For the year 2013, the company projects revenues and earnings to grow 5%-7% over the year. The market is looking for 8% growth on revenues and 9% growth on earnings.

ADP remains focused on small and medium businesses and continued to expand service offerings for this segment. Recently, the company announced an integration with online accounting software provider, Xero. Through the tie-up, Xero’s general ledger solution will be integrated with ADP’s RUN Powered by ADP payroll platform. ADP’s RUN is a cloud-based solution that delivers compliance tools for payroll, tax administration, and employee management.

The integrated solution is tailored to small business owners. Xero provides SMB owners with real-time visibility into their financial positions. The solution also helps online collaboration with clients, virtual teams, and prospects for accounting professionals. The integration will enable both businesses and accounting professionals to transfer data in a simple and secure manner to Xero’s cloud-based software.

The stock is trading at $57.61 with a market capitalization of $27.99billion. The stock provides a $1.58 dividend = 2.8%. The chart shows ADP pulling back slightly from it’s 52 week high but still in strong uptrend

Paychex (PAYX)  Q4 revenues grew 6% over the year to $551.5 million, short of the Street’s projections of $558.0 million. EPS of $0.34 was in line with market expectations and grew 4% over the year.

By segment, payroll service revenues grew 4% to $369.5 million and Human Resource Services revenues grew 12% to $171.2 million.

The company ended the year with revenues up 7% over the year to $2.19 billion and EPS up 6% to $1.51. For the current year, Paychex expects payroll revenues to grow from 3%-4%, just shy of the market’s projected growth of 4.5%.

As part of its expanding product offerings, Paychex recently released a smartphone app for its solutions. The smartphone app for iPhone, Android, and BlackBerry will offer clients and clients’ employees a tool to stay connected to their Paychex payroll, benefits, and retirement information.

Paychex’s closed Friday near it’s one year highs – $33.18, with a market capitalization of $12.04 billion. The stock provides a $1.28 dividend = 3.9% The Chart continues to show a strong uptrend:

 

 

Simple Trading Plan – Short SSO – Chart

1
2,165 views

 

 

 

 

$SPX via SSO has been moving in a very defined channel since the June 4 bottom.

A very simple trade – Short SSO – stop at $57.84 channel breakout

Target:  Approx $53.30 area bottom of Bolinger band / channel

GOOG vs. AMZN

4
3,193 views

According to a recent report published by Forrester 30% of all online shoppers now begin their search at Amazon rather than Google.

According to this article 86% of Americans who have bought something online said they’ve purchased from Amazon before and pressures on competitors as Amazon now controls more than 19 percent of all U.S. e commerce revenue, compared to 9 percent in 2001.

Google attracted only 13 percent of potential buyers as the first stop shop for product research. This is noteworthy change from 2009, when Google led Amazon among consumers 24 percent to 18 percent.

The downside for Amazon comes at the expense of retailers selling through the amazon marketplace:

There have been reports of sellers going into extreme pricing wars to win buy boxes (competing against other sellers and Amazon themselves). On top of that, there have been multiple retailer reports of Amazon reaching out direct to manufacturers that sellers on Amazon use (since retailers give up rights to all sales data that takes place on Amazon, Amazon can easily look at the big picture of their sales data and pick and choose where to expand their own fulfill by Amazon product line). Amazon may soon feel the pain as more retailers leave to list their product elsewhere.

A quick look at the Stock performance of GOOG vs. AMZN over the past 9 months shows GOOG the clear winner. Obviously this is based solely on ad and click through revenues as some things will never be sold via AMZN. What is interesting is that AMZN has set it’s sites on Groupon (GRPN) and similar competitors with their Amazon Local program.

6 new IPOs debut week of Aug 6

3,632 views

Here’s the new lottery numebrs for next week

Manchester United Ltd., one of the most popular soccer clubs on the planet, is slated to go public with an offering that looks to bring in $300 million.

Bloomin’ Brands, which operates Outback, is looking to raise $300 million in its initial public offering.

CKE, which owns Hardees & Carl Jr., is eyeing a $230 million raise.

Peregrine Semiconductor, a technology firm catering to wireless market, is looking to raise $83 million

Performant Financial, which handles collection services on unpaid loans, wants $150 million

Stemline Therapeutics, a biotech company, is eyeing a $42 million raise

TGIF – Notice a pattern?

408 views

Notice the Swings in July seem biggest on Fridays – that seems to say that in spite of Wall of Worry – there is a consistent bid at the end of every week despite 50-70 point swings

Interesting – considering the overall bearish  bias I read from most traders. But as chessNwine points out here we have a rising 50 & 200 DMA

I think I’ll Play short on Monday Open spike which should be close to 1400 and cover at S1 which should be around 1350

 

Possible Swing Trade Short: AAPL

2
1,066 views

Upfront disclosure – I’ve never been an Apple fan. My dislike started with my first ipod and the cluster of dealing with itunes and trying to load songs from my CDs. I think their marketing is/was phenomenal – “you’re a Genius if you buy our products”. LOL. You can’t go wrong appealing to the vanity or intelligence of your customers.

These days however, AAPL isn’t looking quite as smart as the competition catches up.  Here’s a recent article talking about slowing sales of the iphone and how Samsung is now the Number 1 manufacturer of smart phones in the world.

The pace of iPhone sales has slowed, Apple revealed last week. Part of the problem is that the competition has found a formula that works: thinner phones with big screens that make the iPhone look small and chubby.

For a dose of smartphone envy, iPhone owners need to look no further than Samsung Electronics Co., the number-one maker of smartphones in the world. Its newest flagship phone, the Galaxy S III, is sleek and wafer-thin.

By comparison, the iPhone “is getting a bit long in the tooth,” says Ramon Llamas, an analyst with research firm IDC.

Apple has become the world’s most valuable company on the back of the iPhone, which makes up nearly half of its revenue. IPhone sales are still growing, but the question of how fast they’re growing is of keen interest to investors. The iPhone certainly has room to grow: only one in six smartphones sold globally in the second quarter had an Apple logo on its back.

When Apple reported financial results for its latest quarter last week, a new phenomenon was revealed: Buyers started pulling back on iPhone purchases just six months after the launch of the latest iPhone model.

A look at AAPL Chart also shows weakness. A series of lower highs since the early April peak at 644. The stock has found support at it’s pivot twice since it’s May 20 bottom at $522 but the pullbacks at R2 in July tell me there will not be another breakout in the near term. Also look at the declining volume over the last 3 days of buying.

I’m not saying this is a short right now – but if AAPL fails again at R2 (now at $615) then there is $41 dollars (7%) of gain to be had if it pulls back to the pivot yet again

Gain and Pain

40 something Global Director of Business Development for a Security Software Manufacturer. Trading stocks for 15+ years - using primarily technical analysis
Joined Oct 26, 2011
128 Blog Posts

Gain and Pain

Joined Oct 26, 2011
128 Blog Posts

ADP & PAYX – with employment increasing let’s look at payroll processing firms

681 views

Job numbers came in at 163,000 for July, slightly less than the 172,000 jobs added in June. An improving job market is a positive sign for payroll processing firms so lets take a look at the results of the two biggest players:

Automatic Data Processing  (ADP) Q4 revenues grew 5.2% over the year to $2.64 billion, marginally shy of the Street’s projections of $2.65 billion. EPS of $0.53 was in line with the market’s targeted EPS and reported growth over previous year’s earnings of $0.48 for the quarter.

By segment, Employer Services’ revenues grew 7% over the year to $1.88 billion, with the number of employees whose payrolls were processed by ADP in the U.S. rising 3.2% over the year. During the quarter, ADP bought back 6.4 million shares of its stock at a cost of $342 million.

ADP ended the year with revenues growing 8% over the year to $10.67 billion and EPS of $2.82. For the year 2013, the company projects revenues and earnings to grow 5%-7% over the year. The market is looking for 8% growth on revenues and 9% growth on earnings.

ADP remains focused on small and medium businesses and continued to expand service offerings for this segment. Recently, the company announced an integration with online accounting software provider, Xero. Through the tie-up, Xero’s general ledger solution will be integrated with ADP’s RUN Powered by ADP payroll platform. ADP’s RUN is a cloud-based solution that delivers compliance tools for payroll, tax administration, and employee management.

The integrated solution is tailored to small business owners. Xero provides SMB owners with real-time visibility into their financial positions. The solution also helps online collaboration with clients, virtual teams, and prospects for accounting professionals. The integration will enable both businesses and accounting professionals to transfer data in a simple and secure manner to Xero’s cloud-based software.

The stock is trading at $57.61 with a market capitalization of $27.99billion. The stock provides a $1.58 dividend = 2.8%. The chart shows ADP pulling back slightly from it’s 52 week high but still in strong uptrend

Paychex (PAYX)  Q4 revenues grew 6% over the year to $551.5 million, short of the Street’s projections of $558.0 million. EPS of $0.34 was in line with market expectations and grew 4% over the year.

By segment, payroll service revenues grew 4% to $369.5 million and Human Resource Services revenues grew 12% to $171.2 million.

The company ended the year with revenues up 7% over the year to $2.19 billion and EPS up 6% to $1.51. For the current year, Paychex expects payroll revenues to grow from 3%-4%, just shy of the market’s projected growth of 4.5%.

As part of its expanding product offerings, Paychex recently released a smartphone app for its solutions. The smartphone app for iPhone, Android, and BlackBerry will offer clients and clients’ employees a tool to stay connected to their Paychex payroll, benefits, and retirement information.

Paychex’s closed Friday near it’s one year highs – $33.18, with a market capitalization of $12.04 billion. The stock provides a $1.28 dividend = 3.9% The Chart continues to show a strong uptrend:

 

 

$SPX – S&P500 – CCI Showing a Top Approaching

504 views

 

 

 

First, thanks to Selecto at Trader Talk, for the chart used in this post.

For those not familiar with the Commodity Channel Index (CCI) – read this

Selecto has been tracking $SPX with the CCI in this chart and it has been extremely accurate since May.

Another overbought hasn’t triggered yet, but it looks like it’s getting close

Simple Trading Plan – Short SSO – Chart

1
2,165 views

 

 

 

 

$SPX via SSO has been moving in a very defined channel since the June 4 bottom.

A very simple trade – Short SSO – stop at $57.84 channel breakout

Target:  Approx $53.30 area bottom of Bolinger band / channel

GOOG vs. AMZN

4
3,193 views

According to a recent report published by Forrester 30% of all online shoppers now begin their search at Amazon rather than Google.

According to this article 86% of Americans who have bought something online said they’ve purchased from Amazon before and pressures on competitors as Amazon now controls more than 19 percent of all U.S. e commerce revenue, compared to 9 percent in 2001.

Google attracted only 13 percent of potential buyers as the first stop shop for product research. This is noteworthy change from 2009, when Google led Amazon among consumers 24 percent to 18 percent.

The downside for Amazon comes at the expense of retailers selling through the amazon marketplace:

There have been reports of sellers going into extreme pricing wars to win buy boxes (competing against other sellers and Amazon themselves). On top of that, there have been multiple retailer reports of Amazon reaching out direct to manufacturers that sellers on Amazon use (since retailers give up rights to all sales data that takes place on Amazon, Amazon can easily look at the big picture of their sales data and pick and choose where to expand their own fulfill by Amazon product line). Amazon may soon feel the pain as more retailers leave to list their product elsewhere.

A quick look at the Stock performance of GOOG vs. AMZN over the past 9 months shows GOOG the clear winner. Obviously this is based solely on ad and click through revenues as some things will never be sold via AMZN. What is interesting is that AMZN has set it’s sites on Groupon (GRPN) and similar competitors with their Amazon Local program.

6 new IPOs debut week of Aug 6

3,632 views

Here’s the new lottery numebrs for next week

Manchester United Ltd., one of the most popular soccer clubs on the planet, is slated to go public with an offering that looks to bring in $300 million.

Bloomin’ Brands, which operates Outback, is looking to raise $300 million in its initial public offering.

CKE, which owns Hardees & Carl Jr., is eyeing a $230 million raise.

Peregrine Semiconductor, a technology firm catering to wireless market, is looking to raise $83 million

Performant Financial, which handles collection services on unpaid loans, wants $150 million

Stemline Therapeutics, a biotech company, is eyeing a $42 million raise

TGIF – Notice a pattern?

408 views

Notice the Swings in July seem biggest on Fridays – that seems to say that in spite of Wall of Worry – there is a consistent bid at the end of every week despite 50-70 point swings

Interesting – considering the overall bearish  bias I read from most traders. But as chessNwine points out here we have a rising 50 & 200 DMA

I think I’ll Play short on Monday Open spike which should be close to 1400 and cover at S1 which should be around 1350

 

Possible Swing Trade Short: AAPL

2
1,066 views

Upfront disclosure – I’ve never been an Apple fan. My dislike started with my first ipod and the cluster of dealing with itunes and trying to load songs from my CDs. I think their marketing is/was phenomenal – “you’re a Genius if you buy our products”. LOL. You can’t go wrong appealing to the vanity or intelligence of your customers.

These days however, AAPL isn’t looking quite as smart as the competition catches up.  Here’s a recent article talking about slowing sales of the iphone and how Samsung is now the Number 1 manufacturer of smart phones in the world.

The pace of iPhone sales has slowed, Apple revealed last week. Part of the problem is that the competition has found a formula that works: thinner phones with big screens that make the iPhone look small and chubby.

For a dose of smartphone envy, iPhone owners need to look no further than Samsung Electronics Co., the number-one maker of smartphones in the world. Its newest flagship phone, the Galaxy S III, is sleek and wafer-thin.

By comparison, the iPhone “is getting a bit long in the tooth,” says Ramon Llamas, an analyst with research firm IDC.

Apple has become the world’s most valuable company on the back of the iPhone, which makes up nearly half of its revenue. IPhone sales are still growing, but the question of how fast they’re growing is of keen interest to investors. The iPhone certainly has room to grow: only one in six smartphones sold globally in the second quarter had an Apple logo on its back.

When Apple reported financial results for its latest quarter last week, a new phenomenon was revealed: Buyers started pulling back on iPhone purchases just six months after the launch of the latest iPhone model.

A look at AAPL Chart also shows weakness. A series of lower highs since the early April peak at 644. The stock has found support at it’s pivot twice since it’s May 20 bottom at $522 but the pullbacks at R2 in July tell me there will not be another breakout in the near term. Also look at the declining volume over the last 3 days of buying.

I’m not saying this is a short right now – but if AAPL fails again at R2 (now at $615) then there is $41 dollars (7%) of gain to be had if it pulls back to the pivot yet again

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