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Leucadia to Gain From New Tax Law, Pro-Business Environment
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On Jan 16, we updated the research report on Leucadia National Corporation .
Leucadia operates through numerous financial services businesses and merchant banking investments across the globe. As each of these businesses operates according to their own cycle, it leads to well diversified revenue streams for the company. Stronger results from some businesses help to offset weaker results in others, making the company relatively immune to individual business performance.
Leucadia seems poised to benefit from the pro-growth business environment coupled with a lower corporate tax structure. President Trump’s plans of spending $1 trillion in infrastructure projects over an extended period of 10 years, along with regulatory rollbacks to aid profitability of small and medium-sized companies, bode well for Leucadia.
Leucadia's businesses appear favorably positioned, particularly Jeffries. Jeffries’ performance has improved from the recent past, when it was affected by volatility in oil prices and oil-related junk bonds. Companies like National Beef have also had a difficult period in the past years as Americans have switched to healthier eating habits causing the cattle industry to go on a decline. But the fundamentals seem to be improving at present. Profit margins of National Beef have recently improved as the demand for beef has picked up. Investors now have a more optimistic outlook on these companies.
However, Leucadia has a significant exposure to the European market. In light of the Brexit referendum, the European economy is faced with uncertainties, making the company’s revenues unpredictable. Brexit could further result in higher tariff and non-tariff barriers to trade between the U.K. and the European Union, lowering the productivity of the company.
Nevertheless, we maintain a bullish outlook on this stock as it remains well positioned to grow. The company’s shares have outperformed the industry in the last three months with an average return of 8.6% compared with a gain of 1.9% for the latter.
Raven has an expected long-term earnings growth rate of 10%. It exceeded estimates thrice in the trailing four quarters with an average beat of 25.8%.
3M has an expected long-term earnings growth rate of 10.2%. It exceeded estimates thrice in the trailing four quarters with an average beat of 2.5%.
ITT has an expected long-term earnings growth rate of 12.5%. It exceeded estimates in each of the trailing four quarters with an average beat of 8.1%.
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It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Leucadia to Gain From New Tax Law, Pro-Business Environment
On Jan 16, we updated the research report on Leucadia National Corporation .
Leucadia operates through numerous financial services businesses and merchant banking investments across the globe. As each of these businesses operates according to their own cycle, it leads to well diversified revenue streams for the company. Stronger results from some businesses help to offset weaker results in others, making the company relatively immune to individual business performance.
Leucadia seems poised to benefit from the pro-growth business environment coupled with a lower corporate tax structure. President Trump’s plans of spending $1 trillion in infrastructure projects over an extended period of 10 years, along with regulatory rollbacks to aid profitability of small and medium-sized companies, bode well for Leucadia.
Leucadia's businesses appear favorably positioned, particularly Jeffries. Jeffries’ performance has improved from the recent past, when it was affected by volatility in oil prices and oil-related junk bonds. Companies like National Beef have also had a difficult period in the past years as Americans have switched to healthier eating habits causing the cattle industry to go on a decline. But the fundamentals seem to be improving at present. Profit margins of National Beef have recently improved as the demand for beef has picked up. Investors now have a more optimistic outlook on these companies.
However, Leucadia has a significant exposure to the European market. In light of the Brexit referendum, the European economy is faced with uncertainties, making the company’s revenues unpredictable. Brexit could further result in higher tariff and non-tariff barriers to trade between the U.K. and the European Union, lowering the productivity of the company.
Nevertheless, we maintain a bullish outlook on this stock as it remains well positioned to grow. The company’s shares have outperformed the industry in the last three months with an average return of 8.6% compared with a gain of 1.9% for the latter.
Leucadia currently has a Zacks Rank #2 (Buy). Other stocks worth considering in the industry include Raven Industries, Inc. , 3M Company (MMM - Free Report) and ITT Inc. (ITT - Free Report) , each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Raven has an expected long-term earnings growth rate of 10%. It exceeded estimates thrice in the trailing four quarters with an average beat of 25.8%.
3M has an expected long-term earnings growth rate of 10.2%. It exceeded estimates thrice in the trailing four quarters with an average beat of 2.5%.
ITT has an expected long-term earnings growth rate of 12.5%. It exceeded estimates in each of the trailing four quarters with an average beat of 8.1%.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +18.8% from 2016 - Q1 2017, our top stock-picking screens have returned +157.0%, +128.0%, +97.8%, +94.7%, and +90.2% respectively.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - Q1 2017, the composite yearly average gain for these strategies has beaten the market more than 11X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>