Month: July 2021

What makes a stock a blue-chip?

There is no single characteristic that distinguishes a stock as a blue-chip stock; rather, it is a combination of characteristics that lead experts and investors to regard a firm to be a blue-chip stock. A market cap is a metric used to measure a company’s size and value. Their growth is steady throughout time, and the prognosis is also positive. Dividends, which are a share of a company’s profits owed to investors, are paid by some, but not all, blue-chip stocks. Blue-chip corporations offer investors a consistent return in both good and bad times. Blue-chip companies make up a large part of some of the world’s most prestigious indexes, including the Dow Jones Industrial Average, Nasdaq 100, and S&P 500 in the United States.

Apple

• Market value: $2.42LCr
• Dividend yield: 0.61%
• LTP: 145.11USD

Apple (AAPL) is one of the world’s most well-known consumer electronics and computing corporations. Apple Computer Inc., headquartered in Cupertino, California, was founded in 1977. Analysts, on the other hand, are pounding the Buy button on the blue-chip company as hard as ever, arguing that recent underperformance presents investors with an opportunity to buy a superb stock at a discount. Along with Amazon, Google, Microsoft, and Facebook, it is one of the Big Five American information technology companies.

Microsoft: (NASDAQ: MSFT)

Market value: 2.09LCr

Dividend yield: 0. 0.81%

LTP: 277.94 USD

Microsoft was founded in 1972 by college computer geniuses Bill Gates and Paul Allen, who together turned the company into one of the most powerful enterprises in history. Microsoft may be second only to Apple in terms of market capitalization, but it easily outperforms the iPhone maker when it comes to hedge fund enthusiasm. The software company’s stock had risen 9.93 percent in the previous month. The Computer and Technology sector gained 5.91 percent during that time, while the S&P 500 gained 2.71 percent.

Amazon.com (NASDAQ: AMZN)

Market value: $1.88LCr

Dividend yield: N/A

LTP: 3,719.34 USD

As more people began doing their shopping purely on the internet, the online commerce behemoth has surged from its March 2020 lows. Amazon, like Microsoft, currently has a market capitalization of over $1.5 trillion and is one of the most successful firms in American history. Warren Buffett got in on the action. Berkshire Hathaway has been an Amazon stakeholder since 2019.

Everyone has earned major benefits in the short, medium, and long term. Get this: AMZN’s total return has outpaced the broader market over the last three, five, ten, and fifteen years.

Facebook (NASDAQ: FB)

Market value: $ 99.36TCr

Dividend yield: N/A

LTP: 350.42 USD

Facebook, which was the subject of the smash film The Social Network, has grown to be one of the country’s most valuable blue chip firms, with a market capitalization of over $700 billion. Facebook, unlike other social media platforms, has its fingers in a variety of cookie jars: Instagram, WhatsApp, and Oculus Rift are among the companies it owns. Hedge funds can’t get enough of Facebook’s red-hot profit possibilities, despite the pressure from regulators and would-be trustbusters. The key, as with Alphabet, is the digital ad duopoly between Facebook and Google.

Visa (NYSE: V)

Market value: $50.86TCr

Dividend yield: 0.54%

LTP: 238.47 USD

Visa is one of two major credit card companies operating in the United States, alongside Mastercard. American Express and Discover are the other two. Visa has a market capitalization of $450 billion, which is more than $100 billion higher than Mastercard. Visa has evolved into a comprehensive payments processing corporation with a wide range of products and a global footprint, in addition to being a credit card provider.

Walt Disney (NYSE:DIS)

Market value: $ 32.17TCr

Dividend yield: N/A

LTP: 177.04 USD

Starting with its eponymous creator’s disruptive breakthroughs in the animation industry, Walt Disney has a long and distinguished history. Disney has evolved into a multibillion-dollar media and entertainment conglomerate since the early twentieth century. Coronavirus decimated the company’s most valuable assets, particularly its amusement parks and studios. However, analysts predict that the company will rebound strongly following good quarterly results.

Target (NYSE: TGT)

Market cap:12.30TCr

LTP: 248.58 USD

Dividend Yield: 1.45%

Target Corporation is a general merchandise retailer based in Minneapolis, Minnesota. It has 1,897 retail locations in the United States. Its first store debuted in 1962, and it now has more than 44 distribution hubs.

The retailer’s stock has a market capitalization of $90 billion and earnings per share (EPS) of $7.54. Target pays a $2.72 per share yearly dividend, has good liquidity, and trades over 3.5 million shares each day.

Adobe (NASDAQ: ADBE)

Market Cap: $28.80TCr

Dividend yield: NA

LTP:604.50 USD

Adobe Inc. is one of the world’s largest and most diverse software corporations. The stock of creative solutions has a market capitalization of $228 billion and an EPS of $7.94. In June, Adobe reported earnings that set a new high. Kroger improves its earnings forecast and announces a $1 billion stock buyback program Adobe Creative Cloud, Adobe Document Cloud, and Adobe Experience Cloud are all popular offerings.

Chevron (NYSE: CVX)

Market Cap: 20.07TCr

LTP: 104.07 USD

Dividend Yield: 5.15%

Chevron is a global energy business with operations in exploration, production, and refining. Chevron is the United States’ second-largest oil firm, producing 3.1 million barrels of oil equivalent per day, comprising 7.3 million cubic feet of natural gas per day and 1.9 million barrels of liquids per day. Supports U.S. and overseas subsidiaries engaged in integrated petroleum operations, chemicals operations, mining activities, power generation, and energy services with administrative, financial, management, and technology support.

Johnson & Johnson (NYSE: JNJ)

Market value: 44.70TCr

LTP:169.75 USD

Dividend yield: 2.50%

Baby shampoo, Band-Aids, and Tylenol pain medication are just a few of Johnson & Johnson’s well-known consumer items. J&J, on the other hand, is a true healthcare behemoth, producing a vast range of medical gadgets to aid doctors and other medical personnel in performing life-saving surgeries. Johnson & Johnson is a must-have blue-chip company for any large-cap healthcare portfolio, whether it’s hedge funds, mutual funds, or other significant pools of equity money.

Disclaimer

The views and tips expressed by authors or employees of Greynium Information Technologies, should not be construed as investment advise to buy or sell stocks, gold, currency or other commodities. Investors should certainly not take any trading and investment decision based only on information discussed on GoodReturns.in

Earnings Per Share (EPS)

Earnings per share (EPS) is a critical indicator in determining a company’s profitability. It’s computed by dividing a company’s total profit during a given time by the number of shares it has listed on the stock exchange.

The earnings per share (EPS) formula is used to calculate the value of each outstanding share of a corporation. Because the amount of profit earned by firms and the number of shares they have listed on exchanges might differ, EPS provides a per-capita method of assessing each company.

You must first determine a company’s net profit by collecting net income and subtracting any dividend payments before calculating earnings per share. Then divide that number by the number of outstanding shares, which is typically a weighted average over time.

Earnings Per Share (EPS) = (Net income – Dividends from preferred stock)/(Average outstanding shares)

Price to Earnings (PE) Ratio

The price to earnings ratio (PE Ratio) is a measure of a company’s share price in relation to its annual net income per share. The current investor demand for a company’s stock is represented by the PE ratio. Investors anticipate future earnings growth, therefore a high PE ratio often suggests greater demand. The PE ratio is expressed in years, which may be translated as the number of years it will take for earnings to cover the purchase price.

Because it shows how much an investor is ready to pay for one dollar of earnings, the PE ratio is commonly referred to as the “multiple.” In the denominator, PE Ratios are frequently calculated using estimates of next year’s profits per share.

Price to Earnings Ratio= (Price Per Share)/( Earnings Per Share)

Price-to-book value (PB)

Due to frequent fluctuations in the value of income statement components, P/E and other multiples derived using them can be volatile. You can get around this problem by using a price multiple based on a balance sheet metric, such as book value of equity. The current stock price of all outstanding shares is used to calculate the market value (i.e. the price that the market believes the company is worth). The book value is the amount left after the company has liquidated all of its assets and paid off all of its debts.

Debt to Equity (DE) Ratio

The debt-to-equity ratio compares a company’s total debt to its total equity. A high debt-to-equity ratio is unfavorable for equity investors since it indicates a high level of risk. It depicts the relationship between the number of assets financed by creditors versus the amount financed by stockholders. The debt to equity ratio is also known as the “external-internal equity ratio” since it expresses the link between external equity (liabilities) and internal equity (stockholder’s equity). More creditor financing (bank loans) is employed than investor financing when the debt to equity ratio is larger.

Return on Equity (ROE)

The RoE Ratio is a measure of a company’s rate of return on its shares, as the name implies. In other words, it informs investors about the company’s ability to generate profits through stock investments. Return on equity (ROE) is a metric for determining how well a company uses its equity – or the money given by its stockholders as well as cumulative retained earnings – to generate revenue. In other words, the ability of a corporation to convert equity capital into net profit is measured by its return on equity (ROE). The return on investment (ROI) is a metric that assesses both profit and efficiency. A growing ROE indicates that a corporation is generating more profits while using less capital. It also shows how successfully a company’s management manages shareholder funds.

Return on Equity = (Net Income)/(Average Stockholder Equity)

Dividend Yield

The dividend yield, also known as the dividend-price ratio, is the amount of money or dividend paid to shareholders over the course of a year divided by the current stock price. It’s a predictor of how much money you’ll make. The dividend yield of a stock is computed by dividing the company’s annual cash dividend per share by the stock’s current price in annual percentages.

Dividend Yield = (Dividend per Share)/(Price per Share)*100

Current Ratio

This reflects the company’s liquidity position, or how well equipped it is to satisfy short-term obligations with short-term assets. A higher number indicates that working capital concerns will not hinder the company’s day-to-day operations. A current ratio of less than one is problematic.

The weight of total current assets versus total current liabilities is taken into account in this ratio. It shows a company’s financial health and how it may make the most of its current assets to repay debts and payables.

Current Ratio = Current Assets / Current Liabilities

HDFC Retirement Savings Fund Equity Plan

The HDFC Retirement Savings Fund Equity Plan Direct-Growth is an HDFC Mutual Fund Equity mutual fund. It has an AUM of 1,591.61 crores and a current NAV of 28.655 as of July 10, 2021. The minimum SIP amount for this scheme is Rs500.

The fund has the majority of its money invested in Financial, Technology, Chemicals, Engineering, FMCG sectors. The fund’s top 5 holdings are in HDFC Bank Ltd., ICICI Bank Ltd., Reliance Industries Ltd., Infosys Ltd., Housing Development Finance Corpn. Ltd. This fund has a 4-Star rating from ValueResearch Online. It is benchmarked against Nifty 500 TRI. The Expense Ratio of the direct plan of HDFC Retirement Savings Fund is 1.0%. Investors might consider investing in the growth option because dividends are already taxed.

HDFC Small Cap Fund

HDFC Small Cap Fund Direct-Growth is an HDFC Mutual Fund Small Cap mutual fund plan. It is a medium-sized fund in its category, with assets under management (AUM) of 11,574 crores. The fund’s expense ratio is 0.87 percent, which is comparable to the expense ratios charged by most other Small Cap funds. The NAV of HDFC Small Cap Fund for Jul 09, 2021, is 73.38. A SIP in the fund started 5-years ago for Rs 10,000 each month would have generated a corpus today of more than ₹10.75 Lakh

The fund’s investments are mostly in the Services, Chemicals, Technology, FMCG, and Engineering industries. Firstsource Solutions Ltd., Bajaj Electricals Ltd., Sonata Software Ltd., Persistent Systems Ltd.3 Star rating from Value Research Online. The fund benchmarked against the Nifty Free Float Smallcap 100 TRI.

HDFC Mid-Cap Opportunities Fund

HDFC Mid-Cap Opportunities Direct Plan-Growth is an HDFC Mutual Fund Mid-Cap Opportunities Direct Plan-Growth mutual fund plan. It has (AUM) of Rs 28,672 crores, making it a medium-sized fund in its category. The fund’s expense ratio is 1.07 percent, which is higher than the expense ratios charged by most other Mid Cap funds.

The 1-year returns on HDFC Mid-Cap Opportunities Direct Plan-Growth are 72.51 percent. It has returned an average of 20.14 percent every year since its inception. The financial, chemical, engineering, automobile, and healthcare industries account for the majority of the fund’s holdings. Cholamandalam Investment & Finance Co. Ltd., Balkrishna Industries Ltd., Aarti Industries Ltd., Sundram Fasteners Ltd., and Max Financial Services Ltd. are the fund’s top five holdings.

HDFC Index Sensex Fund

HDFC Index Sensex Direct Plan-Growth is an HDFC Mutual Fund Large Cap mutual fund strategy. It is a medium-sized fund in its category, with assets under management (AUM) of 2,210 crores. The fund’s expense ratio is 0.2 percent, which is lower than the expense ratios charged by most other Large Cap funds.

A SIP in the fund started 3-years ago for Rs 10,000 each month would have generated a corpus today of more than ₹4.88 LakhThe majority of the money in the fund is invested in the financial, technology, energy, fast-moving consumer goods, and construction industries. Reliance Industries Ltd., HDFC Bank Ltd., Infosys Ltd., Housing Development Finance Corpn. Ltd. and ICICI Bank Ltd. are the fund’s top five holdings.

HDFC Equity Savings Fund

HDFC Equity Savings Direct Plan-Growth is an HDFC Mutual Fund Equity Savings mutual fund strategy. It is a medium-sized fund in its category, with assets under management (AUM) of 2,390 crores as of 30 June 2021. The fund’s fee ratio is 1.31 percent, which is greater than the expense ratios charged by most other Equity Savings funds. The fund now has a 40.32 percent equity allocation and a 27.08 percent debt allocation. This fund has been rated 5-star by Morningstar.

The financial, healthcare, energy, metals, and technology sectors make up the majority of the fund’s equity holdings. Housing Development Finance Corpn. Ltd., Reserve Bank of India, Infosys Ltd., Reliance Industries Ltd., and ICICI Bank Ltd. are the fund’s top five holdings. HDFC Equity Savings Fund’s NAV for July 9, 2021 is 49.46.

Disclaimer

Mutual Fund investing is subject to market risks. One should exercise caution and invest only if he or she is able to bear losses. The above article is for information purposes only. Neither the author nor Greynium Information Technologies would be responsible for losses incurred on decisions based on this article. Please be careful and consult an advisor before investing.

Shriram Transport Finance Unnati Scheme

This scheme has been rated as FAAA by CRISIL, which is the highest possible rating. The interest rates being offered on a 5-year deposit is as high as 8.25% per annum. On the other hand the 1-year deposit fetches an interest rate of 7.25%, while the interest rate on the 2-year deposit is 7.50% and the 3-year deposit fetches an interest rate of 8%.

We suggest that investors invest in these deposits for the short term. In the more long-term it is likely that interest rates could go higher, given how inflation has been panning out. Investors can opt for the cumulative option or for the regular interest payment option like quarterly or yearly.

PNB Housing Finance

This is another AAA rated deposit, though the interest is lower than Shriram Transport Finance Unnati Scheme.

A 3-year deposit fetches an interest rate of 6.60%, while a 4-year deposit is also 6.60% and a 5-year deposit fetches an interest rate of 6.7%. Senior citizens are entitled to an extra interest rate of 0.25%.

It’s important to remember that company fixed deposits attract a TDS, if the interest income crosses the Rs 5,000 mark. In the case of banks a TDS is applicable if the interest income crosses Rs 10,000. It is therefore advisable to calculate the interest accordingly and place money in multiple deposits.

Bajaj Finance

Bajaj Finance deposits are also AAA rated. The interest rates on a 3, 4 and 5 year deposit is 6.5%. This is almost 1% more than what banks in the country are offering. There is no safety concern here as the deposits are being offered by a company with a strong pedigree.

In the Bajaj Finance deposits one can take a slightly long term view as well while investing in the deposits. Most of the companies now allow deposits to be opened online. The process and procedure to open the deposits are clearly indicated on the website of these companies.

ICICI Home Finance

This is another AAA rated deposit, which offers interest rates in line with most peers. A 3-year deposit gives an interest rate of 6.05%, while a 4-year deposit it is 6.30%, while for a 5-year deposit the same is 6.40%.

Investors who have a TDS that is likely to happen for interest over Rs 5,000 could submit form 15G or 15H, if they are not liable to pay income tax.

It’s important to remember that fixed deposits of companies are not secure and hence there is an element of risk in company deposits. In the past there have been defaults in debt instruments of company deposits.

We suggest that you invest only in the AAA rated deposits with companies that have a strong pedigree.

Disclaimer

Investing in fixed deposits is risky as they are unsecure deposits. The author, or Greynium Information Technologies Pvt Ltd is not responsible for any losses incurred due to a decision based on the above article. Investors should hence exercise caution and do their own research.

Earnings Per Share (EPS)

Earnings per share (EPS) is a critical indicator in determining a company’s profitability. It’s computed by dividing a company’s total profit during a given time by the number of shares it has listed on the stock exchange.

The earnings per share (EPS) formula is used to calculate the value of each outstanding share of a corporation. Because the amount of profit earned by firms and the number of shares they have listed on exchanges might differ, EPS provides a per-capita method of assessing each company.

You must first determine a company’s net profit by collecting net income and subtracting any dividend payments before calculating earnings per share. Then divide that number by the number of outstanding shares, which i

Price to Earnings (PE) Ratio

The price to earnings ratio (PE Ratio) is a measure of a company’s share price in relation to its annual net income per share. The current investor demand for a company’s stock is represented by the PE ratio. Investors anticipate future earnings growth, therefore a high PE ratio often suggests greater demand. The PE ratio is expressed in years, which may be translated as the number of years it will take for earnings to cover the purchase price.

Because it shows how much an investor is ready to pay for one dollar of earnings, the PE ratio is commonly referred to as the “multiple.” In the denominator, PE Ratios are frequently calculated using estimates of next year’s profits per share.

Price to Earnings Ratio= (Price Per Share)/( Earnings Per Share)

Price-to-book value (PB)

Due to frequent fluctuations in the value of income statement components, P/E and other multiples derived using them can be volatile. You can get around this problem by using a price multiple based on a balance sheet metric, such as book value of equity. The current stock price of all outstanding shares is used to calculate the market value (i.e. the price that the market believes the company is worth). The book value is the amount left after the company has liquidated all of its assets and paid off all of its debts.

Debt to Equity (DE) Ratio

The debt-to-equity ratio compares a company’s total debt to its total equity. A high debt-to-equity ratio is unfavorable for equity investors since it indicates a high level of risk. It depicts the relationship between the number of assets financed by creditors versus the amount financed by stockholders. The debt to equity ratio is also known as the “external-internal equity ratio” since it expresses the link between external equity (liabilities) and internal equity (stockholder’s equity). More creditor financing (bank loans) is employed than investor financing when the debt to equity ratio is larger.

Return on Equity (ROE)

The RoE Ratio is a measure of a company’s rate of return on its shares, as the name implies. In other words, it informs investors about the company’s ability to generate profits through stock investments. Return on equity (ROE) is a metric for determining how well a company uses its equity – or the money given by its stockholders as well as cumulative retained earnings – to generate revenue. In other words, the ability of a corporation to convert equity capital into net profit is measured by its return on equity (ROE). The return on investment (ROI) is a metric that assesses both profit and efficiency. A growing ROE indicates that a corporation is generating more profits while using less capital. It also shows how successfully a company’s management manages shareholder funds.

Return on Equity = (Net Income)/(Average Stockholder Equity)

Dividend Yield

The dividend yield, also known as the dividend-price ratio, is the amount of money or dividend paid to shareholders over the course of a year divided by the current stock price. It’s a predictor of how much money you’ll make. The dividend yield of a stock is computed by dividing the company’s annual cash dividend per share by the stock’s current price in annual percentages.

Dividend Yield = (Dividend per Share)/(Price per Share)*100

Current Ratio

This reflects the company’s liquidity position, or how well equipped it is to satisfy short-term obligations with short-term assets. A higher number indicates that working capital concerns will not hinder the company’s day-to-day operations. A current ratio of less than one is problematic.

The weight of total current assets versus total current liabilities is taken into account in this ratio. It shows a company’s financial health and how it may make the most of its current assets to repay debts and payables.

Current Ratio = Current Assets / Current Liabilities