For Immediate Release
Chicago, IL – October 23, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog includeJanus Small Cap Growth Alpha ETF, PowerShares KBW Regional Bank Portfolio andPowerShares Buyback Achievers Portfolio.
Here are highlights from Friday’s Analyst Blog:
GOP Nears Tax Reform: Buy These ETFs
In a step forward toward tax cuts, Senate Republicans okayed a $4-trillion budget measure on Oct 19. The chamber agreed to the budget resolution by a 51-49 vote, as per CNBC.com. The Senate would now permit a net $1.5 trillion tax cut over a decade. Republicans intend to accelerate the timeline on tax reform and the White House intends to turn it into a law by the end of the year.
At the end of September, Trump revealed his much talked-about tax plan, suggesting comprehensive tax cuts for individuals and corporations. Some of the key suggestions are a cut in the corporate tax rate to 20% from 35% and slashing of the number of individual tax brackets to three from seven.
The lowest bracket will increase from 10% to 12%, the middle bracket will be 25%, and the highest tax bracket will fall from 39.6% to 35%. The proposal will now be studied and perhaps altered in the coming days (read: Build Your Portfolio With 4 ETFs in Q4).
Earnings are expected to see a considerable gain if the tax reform takes shape. So, stocks are riding higher on hopes this reform. Steven Mnuchin, U.S. Treasury secretary, already cautioned Congress that the U.S. stock markets will chop off a “significant amount” of their recent gains if tax reform does not materialize.
As per an article published on Investor’s Business Daily, Wall Street hearsay is that Trump’s tax cuts would see the day of light in the first half of 2018, but the program would be ‘smaller’ in size. Analysts at Morgan Stanley and Goldman Sachs “have indicated that they see a 25% corporate tax rate as much more likely than the 20% that the White House says is nonnegotiable.”
However, a 25% tax rate would lead S&P 500 earnings to expand 8% and push the index north to 2650 by the yearend, according to Goldman chief equity strategist David Kostin, quoted on Investor’s Business Daily.
However, there are several hurdles in the way to tax cuts. As per an article published on investors.com, “there appears to be very little chance Republicans will find the budget offsets to make corporate tax cuts permanent.” Still, things are looking bright at this stage when it comes to tax reform and put these ETFs up for gains.
U.S. Tax Reform Fund
This newly launched fund looks to offer capital gains by investing in market segments that the issuer thinks “will be impacted by the enactment of changes to the U.S. Tax Code.” It charges 85 bps in fees. No stock accounts for more than 3.49% of the fund.
Republican Policies Fund
This new fund targets market segments that are likely to be moved (deemed by the issuer) by the enactment of Republican Policies. The fund charges 75 bps in fees. No stock accounts for more than 3.7% of the fund.
Janus Small Cap Growth Alpha ETF
The fund picks pint-sized stocks by assessing each company’s performance in three factors: growth, profitability and capital efficiency. The fund charges 50 bps in fees. No stock accounts for more than 3.05% of the fund.
As per an article published on CNBC, small companies, which are more domestically focused and have less foreign exposure, pay huge taxes in America. This is because these pint-sized companies can’t pile up cash in foreign lands. So, a slash in tax rates would give a big-time benefit to these companies (read: Asset Report of September: Small Caps Rule).
PowerShares KBW Regional Bank Portfolio
As per an article published on CNBC, a senior analyst at AB Bernstein noted that “large banks likely would see 2018 earnings per share jump by 12 to 20 percent, while midcaps would see growth of 15 to 25 percent.” Compared with the other sectors, the gain from tax reforms for large-cap banks would be in the 4% to 12% range while small-caps would see a boost of 7% to 17%, according to the article published on CNBC. This brings KBWR in the spotlight. No stock makes up for more than 3.83% of the 50-stock fund.
PowerShares Buyback Achievers Portfolio
The Trump administration is also proposing a move from the current worldwide tax system to a territorial system, letting companies to send their offshore profits back to the United States without extra taxes. Since Trump proposes a tax on more than $2.5 trillion in offshore earnings, tax cuts and a one-time repatriation tax could boost share repurchases by companies.
This makes the case for buyback ETF investing important. Boeing is the top stock of the 223-stock fund with about 6.3% exposure. The fund charges 63 bps in fees (read: Bet on These ETFs on New Hopes for Tax Reform).
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.See these high-potential stocks free >>.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights: Janus Small Cap Growth Alpha ETF, PowerShares KBW Regional Bank Portfolio and PowerShares Buyback Achievers Portfolio
For Immediate Release
Chicago, IL – October 23, 2017 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog includeJanus Small Cap Growth Alpha ETF, PowerShares KBW Regional Bank Portfolio andPowerShares Buyback Achievers Portfolio.
Here are highlights from Friday’s Analyst Blog:
GOP Nears Tax Reform: Buy These ETFs
In a step forward toward tax cuts, Senate Republicans okayed a $4-trillion budget measure on Oct 19. The chamber agreed to the budget resolution by a 51-49 vote, as per CNBC.com. The Senate would now permit a net $1.5 trillion tax cut over a decade. Republicans intend to accelerate the timeline on tax reform and the White House intends to turn it into a law by the end of the year.
At the end of September, Trump revealed his much talked-about tax plan, suggesting comprehensive tax cuts for individuals and corporations. Some of the key suggestions are a cut in the corporate tax rate to 20% from 35% and slashing of the number of individual tax brackets to three from seven.
The lowest bracket will increase from 10% to 12%, the middle bracket will be 25%, and the highest tax bracket will fall from 39.6% to 35%. The proposal will now be studied and perhaps altered in the coming days (read: Build Your Portfolio With 4 ETFs in Q4).
Earnings are expected to see a considerable gain if the tax reform takes shape. So, stocks are riding higher on hopes this reform. Steven Mnuchin, U.S. Treasury secretary, already cautioned Congress that the U.S. stock markets will chop off a “significant amount” of their recent gains if tax reform does not materialize.
As per an article published on Investor’s Business Daily, Wall Street hearsay is that Trump’s tax cuts would see the day of light in the first half of 2018, but the program would be ‘smaller’ in size. Analysts at Morgan Stanley and Goldman Sachs “have indicated that they see a 25% corporate tax rate as much more likely than the 20% that the White House says is nonnegotiable.”
However, a 25% tax rate would lead S&P 500 earnings to expand 8% and push the index north to 2650 by the yearend, according to Goldman chief equity strategist David Kostin, quoted on Investor’s Business Daily.
However, there are several hurdles in the way to tax cuts. As per an article published on investors.com, “there appears to be very little chance Republicans will find the budget offsets to make corporate tax cuts permanent.” Still, things are looking bright at this stage when it comes to tax reform and put these ETFs up for gains.
U.S. Tax Reform Fund
This newly launched fund looks to offer capital gains by investing in market segments that the issuer thinks “will be impacted by the enactment of changes to the U.S. Tax Code.” It charges 85 bps in fees. No stock accounts for more than 3.49% of the fund.
Republican Policies Fund
This new fund targets market segments that are likely to be moved (deemed by the issuer) by the enactment of Republican Policies. The fund charges 75 bps in fees. No stock accounts for more than 3.7% of the fund.
Janus Small Cap Growth Alpha ETF
The fund picks pint-sized stocks by assessing each company’s performance in three factors: growth, profitability and capital efficiency. The fund charges 50 bps in fees. No stock accounts for more than 3.05% of the fund.
As per an article published on CNBC, small companies, which are more domestically focused and have less foreign exposure, pay huge taxes in America. This is because these pint-sized companies can’t pile up cash in foreign lands. So, a slash in tax rates would give a big-time benefit to these companies (read: Asset Report of September: Small Caps Rule).
PowerShares KBW Regional Bank Portfolio
As per an article published on CNBC, a senior analyst at AB Bernstein noted that “large banks likely would see 2018 earnings per share jump by 12 to 20 percent, while midcaps would see growth of 15 to 25 percent.” Compared with the other sectors, the gain from tax reforms for large-cap banks would be in the 4% to 12% range while small-caps would see a boost of 7% to 17%, according to the article published on CNBC. This brings KBWR in the spotlight. No stock makes up for more than 3.83% of the 50-stock fund.
PowerShares Buyback Achievers Portfolio
The Trump administration is also proposing a move from the current worldwide tax system to a territorial system, letting companies to send their offshore profits back to the United States without extra taxes. Since Trump proposes a tax on more than $2.5 trillion in offshore earnings, tax cuts and a one-time repatriation tax could boost share repurchases by companies.
This makes the case for buyback ETF investing important. Boeing is the top stock of the 223-stock fund with about 6.3% exposure. The fund charges 63 bps in fees (read: Bet on These ETFs on New Hopes for Tax Reform).
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.See these high-potential stocks free >>.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
support@zacks.com
http://www.zacks.com
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performancefor information about the performance numbers displayed in this press release.