April 25, 2020, 3:10 PM

8 min read

8 min read

As the nations scientists toil in laboratories to find a vaccine for COVID-19, the federal government, research groups and the pharmaceutical industry are working to solve a different scientific challenge: massively scaling up production of these vaccines so they can be ready to deploy as soon as there is proof that one of them works.

"Thinking about manufacturing and scale-up in the very earliest stages is critical," Dr. Barton Haynes, director of the Duke Human Vaccine Institute told ABC News. "The question is: what do we need to be doing now to deliver a vaccine that we think is safe and effective as quickly as possible?"

Unfortunately, industry scientists find that the vaccine technologies being tested today wont be easy to scale, thanks to the complex nature of vaccines. And now, amid a rush to scale up manufacturing in preparation for eventual launch, the Trump administration has unseated Dr. Rick Bright, the government official responsible for leading the charge on the production and purchase of vaccines.

Bright, previously director of the Biomedical Advanced Research and Development Authority (BARDA), wrote a scathing rebuke of his ousting, claiming the Trump administration is placing politics and cronyism ahead of science.

Even with Bright gone, the race to scale up vaccine manufacturing continues, now with acting director Gary Disbrow at the helm. So far, BARDA has invested heavily in the nations most promising vaccine candidates, including $483 million to Moderna and committing more than $1 billion together with Johnson & Johnson for vaccine development and manufacturing.

Vaccine development costs a lot of time and money. Science typically proceeds in a linear fashion, first in test tubes, then in animals and people, and then eventually the expensive and complex process of manufacturing large batches of vaccines for mass immunization.

Editor's Picks

How school closures put children at risk

Questions remain over whether COVID-19 recovery will guarantee immunity: Is reinfection still possible?

Animal studies give hope to a future where a pill could prevent COVID-19 infection

However, in this pandemic, all these phases need to overlap simultaneously. That means that vaccine groups must start preparing to ramp up production, sometimes before knowing that their vaccine works in test tubes.

"Theres a full-out, break-the-glass attitude about making this vaccine," said Dr. Paul Offit, co-inventor of the rotavirus vaccine who sits on the Food and Drug Administrations vaccine advisory committee.

Even before showing that the vaccine can produce a lasting, protective immune response, groups are making a bet and taking huge financial risk to make plans for scale-up.

"The easier part is creating strains and showing proof that your concept works in animals. But then you have to do the hard part In vaccines, the process is the product," said Offit.

Although the pipeline of COVID-19 vaccine candidates is diverse, most are stuttering in their goals of being deployed at a pandemic scale.

Moderna, for example, made headlines with its mRNA candidate vaccine, which entered initial early stage safety testing in humans less than ten weeks after the genetic sequence of SARS-CoV-2 was released on January 11.

But Moderna uses RNA -- a brand new technology in vaccines at this scale -- meaning scientists cant yet predict what manufacturing problems might crop up. Other groups, such as Duke, the Imperial College of London and Fudan University in China, are also exploring this promising approach.

RNA technology leaves researchers with many unsolved challenges, compared to more traditional vaccine types that are already mass produced. One current problem is storage to ensure the vaccine doesnt degrade. This proves especially tricky for RNA which, by nature, is an intrinsically unstable molecule.

"We havent figured out a way to make RNAs stable in the refrigerator yet," said Dr. Rhiju Das, associate professor of biochemistry at Stanford and leader of Eterna massive open laboratory.

"Currently, theyll have to be deployed in ultra-cold freezers at -80C. These are available to us since we live near biomedical research facilities, but theyre not going to be available to my friends and family who live in rural parts of the U.S. or in India," Das said.

Yet another problem is securing enough accessory chemicals, critical for vaccine production.

"Many of these RNA vaccines are formulated with magical chemicals that look like oil droplets. These accessory materials are expensive and hard to make in large quantities. No one has figured out how to scale up their manufacturing or get the costs low enough so that everyone can get the vaccine," explained Das.

Other types of vaccines being tested are composed of a piece of the virus. The pharmaceutical companies GlaxoSmithKline, Novavax and Clover are all at various stages of testing this approach. Called protein subunit and recombinant protein vaccines, this approach is similar to existing vaccines used for HPV and Hepatitis B.

But even this more traditional vaccine approach comes with its own distinct scale-up challenges. These vaccines may require booster shots to provide lasting protection against COVID-19.

For other vaccinate candidate types, scientists are unsure if one dose is enough to generate and maximize a protective immune response, meaning each American might have to be given multiple doses -- further complicating manufacturing scale-up.

An employee shows a blood sample for COVID-19 antibody testing at home at the Labor Dr. Heidrich & Kollegen MVZ GmbH medical lab, on April 16, 2020, in Hamburg, Germany. The Heidrich lab, one of approximately 130 medical labs in Germany doing COVID-19 testing, is processing on average over 100 tests a day, both from people who use the lab's at-home swabbing kit and from samples arriving from local medical practices.

All the issues of development, manufacturing, scale-up and distribution, would be nearly insurmountable for one group to tackle on their own. Of the confirmed active vaccine candidates, 56 are being developed by private industry developers, while 22 projects are being led by academic, public sector and other non-profit organizations, according to a report in Nature.

The pandemic has brought unprecedented collaboration among vaccine developers across the world. The National Institutes of Health is launching a public-private partnership to speed COVID-19 vaccine and treatment options, known as ACTIV -- short for Accelerating COVID-19 Therapeutic Interventions and Vaccines.

Scientists work tirelessly to curb the pandemic through developing a safe, effective vaccine that can reach people across the world. Experts hope the enthusiasm for a COVID-19 vaccine will transfer to other vaccination efforts.

"Past vaccine efforts have been more limited on the patient uptake side than on the supply side. Some people are resistant to flu vaccines," Dr. Andrew Badley, chair of the Mayo Clinic Covid Research Task Force, said to ABC News.

"With this global scare, Im hopeful that vaccine uptake will be better. I hope that people learn that vaccines for other infectious diseases are beneficial, too. And I hope that in the coming years, more people will opt to take those vaccines as well," Badley said.

Tiffany Kung, M.D., a resident physician at Presbyterian/St. Luke's Hospital in Denver, is a contributor to the ABC News Medical Unit.

Top Stories

Unsolved issues and huge investments in COVID vaccine manufacturing

Apr 25, 3:10 PM

Man gets 18 months in prison for threatening to kill Trump

Apr 25, 11:57 PM

Survivors of 1993 Waco siege describe fatal fire that ended standoff

Jan 03, 1:52 PM

Over 200,000 now dead worldwide from COVID-19

Apr 26, 4:16 AM

What it was like to be a Branch Davidian under leader David Koresh

Jan 02, 11:00 PM

Read the original here:
Unsolved issues and huge investments in COVID vaccine manufacturing - ABC News

If youre not Netflix, Amazon or Walmart right now, youre probably bracing for a rough few months or more.

The New York Times estimated the unemployment rate is already at 20%. The ad industry is estimated to see nearly $26 billion in lost revenue. Supply chains have taken a massive hit, and even Apple has hit some turbulence, with iPhone shipments reduced by as much as 10% in Q1. All conferences and live events have been canceled; the music industry and the tech event industry are poised to lose billions.

But heres the good news: There is opportunity for growth. I work with some of the countrys top brands in media, technology, retail, finance and information services, and I have seen what leads businesses to fail and what leads them to succeed. And the truth is that businesses need to lean into their digital strategies right now to have the best chance of weathering this crisis and coming out of it stronger.

Yes, in the midst of economic uncertainty, Im suggesting you make an investment in growing not just sustaining your business. COVID-19 isnt just changing how were doing business this spring; its going to change how we do business far into the future.

Take the retail space for example: If youre not online in retail right now, youre not in business. Retail is the nations largest private-sector employer, but in March, retailers across the country cut 46,200 jobs; that number could rise into the millions. Retailers with a strong digital presence, on the other hand, have seen a surge in business as people are relying on ecommerce and mobile for nearly all their purchases. There is so much new business coming in that some such as Walmart and Amazon are planning to hire hundreds of thousands of new employees.

Even companies that already have an established digital presence are working to beef up their existing infrastructure to catch up to the industry leaders. For example, Best Buy just launched curbside pick-up across the country in late March. Now, its 1,200 stores are closed to customers but delivering orders to cars in their parking lots. Another example is Giant-Eagles new Pick-Up Centers, which are converting traditional stores into dedicated pick-up locations that enable customers to perform the expensive last-mile delivery themselves. These examples could become the new normal, as customers become accustomed to mobile app ordering and seamless curbside pickup.

The reality is that peoples buying habits are changing, and while brick and mortar is sure to make a comeback when lockdowns are over, there will likely be more demand for digital platforms in retail whether that means more digital payment options, virtual showrooms, in-store recommendations based on your online search history, or digital price tags.

Or consider healthcare. The healthcare industrys transition to telemedicine has rapidly accelerated in the face of COVID-19. Online pharmacies like UpScript are booming. IoT and remote patient monitoring are already proving to be extremely helpful in the midst of the pandemic, with organizations like Shanghai Public Health Clinical Centerusing this technology to continuously monitor patients and get real time updates. This technology is already being deployed in various use cases across healthcare, and we will likely see it deployed more and more as a way to provide better real time care to patients.

Telehealth startups are in the forefront of the news. A large portion of the $2 trillion stimulus bill was focused on expanding telehealth access for Americans, and federal policy will surely follow the easing of rules around telemedicine that were already seeing at the state level. Ohio Gov. Mike DeWine just signed an order allowing social workers, family counselors and marriage counselors to offer telehealth services. To be HIPAA compliant, these organizations will need to invest in buying or building true telehealth software not just spinning up a noncompliant FaceTime or Skype session. This creates the opportunity for multiple new telehealth providers to enter the market.

Media is another industry that is facing dramatic transformation. With live sports on hiatus, were streaming more media than ever. Americans streamed 85% more video in March 2020 than in March 2019, on platforms and channels from Netflix to YouTube to PBS. More streaming services are being launched, such as HBO Max, NBC Peacock and Quibi. COVID-19 could accelerate subscriptions as people become more accustomed to paying for content they appreciate.

Additionally, live events are shifting to virtual events. Financial Times predicts that many wont want to go back to airless conference centers now that theyve seen what events are like from the comfort of their own couches. Lady Gagas virtual concert held in mid-April drew 20 million viewers.

Investing in new products and platforms is always a risk, and maintaining the status quo is the easiest path during times of economic uncertainty. But many businesses that plan to stand still right now will end up backsliding. Taking the risk to improve your organizations digital infrastructure could ensure your current and future viability.

More here:
Now is the time to invest in your business' digital upgrade - Technical.ly

Nassim Taleb, in his book, explains a Black Swan event as one that a) is unexpected and b) carries extreme impact. The coronavirus pandemic is a Black Swan event considering that it was not predicted, and it has led to a virtual shutdown in a large part of the world.

In the investment world, such events pose a challenge. Preparing for bubbles is different. There are some indicators or markers that would signal to the keen observer that prices have significantly moved higher than fundamental values. Here, the investor can vary the exposure levels to participate and later protect oneself from such bubbles. But how does one prepare for something that is difficult to predict?

One can buy insurance through hedging. However, being hedged against all kinds of risks, all the time will adversely impact returns.

Common characteristics of market crisis

There may not be a way to anticipate Black Swan events, but there are ways to navigate them and use them to our advantage (carefully). Market crashes historically have some common characteristics:

Investors are gripped by fear and predict a wide range of forecasts about the market (some of them extremely bearish). Unfortunately, the reigning pessimism will push people to assign high probability to extreme outcomes too. (Fear of further loss, herd mentality)

Growth premium falls. Valuations crash to historic lows. Creative valuation methods are exposed. (Negative feedback loop)

High uncertainty will lead to investors giving unduly high importance to short term movements. (Myopic loss aversion)

Correlations rise and hence diversification may not help much. Investors take cash calls. (Liquidity preference)

Good news is ignored. Participants overreact to bad news. (Cognitive dissonance, confirmation bias)

Market crash affects economic activity adversely. (Reflexivity)

Credit markets get impacted. Financial institutions may shy away from lending. Credit spreads rise Leveraged companies under serious threat. (Risk off)

New money stops moving into equity. Panic leads to redemptions or exits. (Risk off)

Headlines and sentiment will be negative. (Narratives)

Once investors know the behavioural cycle of the market, they have an edge that can help them take advantage of the crash. They can buy into the pessimism, hold the investments through the long term and sell into euphoria. The seeds of wealth are sown during bad times and the fruits of the effort are harvested during good times.

Handling the Swan

Once you understand the market cycle and are convinced to take advantage of the crash, there are two important questions to address: How to invest?

And What to invest in?

How to invest: Handling duration blindness

One of the most difficult problems an investor faces in handling black swan type crisis is duration blindness. Since there is no precedence of such an event, it is difficult to estimate the time the crisis will last for. The investor can use various estimates from experts but make room for the errors in forecasting too. It is extremely rare to catch the exact low of the market while investing.

Hence it is better to stagger the investment over a significant period of time. Selection of this time frame is subjective. However, it is better to keep a longer duration so as to accommodate a margin of safety in terms of timing too.

What to invest in: Handling portfolio selection

During a market crash, the frothy valuations get almost eliminated and sub-standard businesses are penalised heavily. The investor is in given an opportunity to choose from a wide variety of businesses that have come to attractive levels. To create a robust portfolio, one must follow some basic principles:

Stay within the circle of competence: Typically, in these markets, investors run a screener to check which stocks have corrected the most in the fall. Being anchored at the 52-week high or all-time high prices, one is tempted to dive into businesses that one may not have tracked earlier. Not knowing what you are buying (irrespective of valuation) makes you vulnerable to losses. Stay within the stock universe that you understand well.

Avoid companies with high financial leverage: Leveraged companies can often run into liquidity troubles. These businesses have to survive the downturn to make money for the investor.

Also, in an environment where quality companies are available at attractive valuations, there needs to be very high payoff to move into riskier stocks. Unless, the earnings trajectory is fairly visible, dabbling with high debt companies can be avoided.

Buy robust business model, cash rich, high RoCE companies: During a bull market, even companies with fragile businesses or weak balance sheets or negative cashflow profiles are able to raise money based on a concept or an idea. A lot of zombie companies continue to survive due to easy money conditions.

After a crash, investors who have burnt their fingers in such stocks, will shift to companies that have a robust growth-oriented business model, good management and strong balance sheet. Healthy cashflows and RoCE are a mark of a good business. Scalability, brand franchise and good leadership are other important characteristics to choose a company.

To sum up, Black Swan events are unexpected, high impact events. Investors can take advantage of these events by understanding the fundamentals and behavior of a market crash. However, it is important to a) be humble and stagger the investments over a reasonable time frame and b) be meticulous in picking up good quality businesses.

View original post here:
Ways of the Black Swan and how to handle it in investing - Economic Times

Former Democratic presidential candidate Mike Bloomberg addresses his staff and the media after announcing that he will be ending his campaign on March 04, 2020 in New York City.

Spencer Platt | Getty Images

Billionaire and former presidential candidate Mike Bloomberg has invested over $20 million in his own digital tech company weeks after he dropped out of the Democratic presidential primary.

The $20 million investiture went to Hawkfish on March 31 through Bloomberg's campaign, according to a new Federal Election Commission filing. That disbursement was for "digital consulting" but the Bloomberg campaign had already ended by then and his team was in the process of moving on from a disappointing run for president. Another $1.5 million was spent on Hawkfish on that same day for "digital advertising." Bloomberg officially dropped out of the race on March 4 after entirely funding the campaign.

The massive sum is on top of the $45 million the campaign spent on Hawkfish's services throughout the firm's work for its founder Bloomberg, according to the nonpartisan Center for Responsive Politics. The eight-figure spend by Bloomberg in March shows that Hawkfish has a ton of financial reserves that could be of help to any campaign that signs up for its services.

Bloomberg, a billionaire with a net worth of $54 billion, seems to have disappeared from the scene after transferring $18 million to the Democratic National Committee and walking away from having his own outside entity help the apparent party nominee in Joe Biden. He ended up laying off his staff who were placed in key battleground states in the wake of his withdrawal in March.

A person close to Bloomberg in the business community, who declined to be named in order to speak freely, recently told CNBC that the former New York mayor is still disappointed in the way his campaign panned out after spending just over $1 billion of his own money, and he's not yet ready to get back into the public eye of taking on President Donald Trump. Party donors have been privately hoping that Bloomberg gets more involved sooner rather than later as Trump, along with the Republican National Committee, has an extensive war chest that they've been building for years.

A spokesman for Bloomberg declined to comment.

Read this article:
Mike Bloomberg invested over $20 million in Hawkfish weeks after he dropped out of the 2020 primary - CNBC

Magazine April 2020 War and Peace in the Philippines Asia Defense|Security|East Asia

Convincing China to agree to nuclear limitation agreements will require investments in American forces.

Prior to the COVID-19 global pandemic, President Donald Trump made clear his intention to engage China and Russia to seek new agreements limiting theater- and intercontinental-range nuclear missiles.

However, the Chinese Communist Party (CCP) leaderships long-standing refusal to join nuclear limitation negotiations, its Peoples Liberation Armys (PLAs) current overwhelming superiority in theater nuclear and nuclear capable systems, and its broad investments in new intercontinental nuclear systems and new strategic missile defenses, require that Washington also place a high priority on developing new strategic nuclear capabilities and making additional investments in missile defenses to counter this aggression.

The logic for pursuing negotiations is compelling: there is a good chance that China is seeking nuclear parity, if not superiority, versus the United States. Yes of course, China regularly denies that it seeks a large strategic nuclear force. But perhaps such statements, combined with Chinas abhorrence of nuclear transparency, reflect its deeper history of strategic deception.

After all, it was Chinas achievement of decisive superiority in theater nuclear-capable missiles, about 1,800 to 2,000 systems, that helped the Trump administration withdraw from the 1987 Intermediate Nuclear Forces (INF) Treaty with Russia. The PLA Rocket Force (PLARF) now has the precision land-attack and anti-ship capable, 4,000-kilometer range Dong Feng (DF)-26 and the 2,000-km range DF-17, the worlds first maneuverable anti-missile evading Hypersonic Glide Vehicle (HGV) armed theater missile.

Defense Intelligence Agency Director Lt. Gen. Robert P. Ashleys May 30, 2019 statement at the Hudson Institute that China could over the next decade double the size of its nuclear stockpile, which could reach about 600 nuclear warheads, is regarded as an overestimate by some analysts. But this could be an underestimate considering the variety of new intercontinental missiles now being deployed or developed.

Enjoying this article? Click here to subscribe for full access. Just $5 a month.

The PLARF may have three six-missile brigades of the liquid-fueled silo-based DF-5 intercontinental ballistic missile (ICBM), with perhaps two brigades with the three-warhead DF-5B. Meanwhile the 10-warhead DF-5C is in development but could be succeeded by a silo-based version of the solid-fueled 10-warhead capable DF-41. A road-mobile version of the DF-41 may already equip multiple brigades and a rail-based version is also under development.

The PLA Navy (PLAN) meanwhile is reported to have tested its new, potentially multiple warhead capable, JL-3 submarine-launched ballistic missile (SLBM). And sometime in the mid-2020s, the Xian H-20 flying-wing strategic bomber will complete the PLAs strategic triad.

At the same time as this Chinese missile buildup, Americas nuclear forces and missile defenses are in flux. Of note is the upgrade of the Ground-Based Interceptors (GBI) meant to destroy incoming offensive ICBMs launched at the United States.

The Redesigned Kill Vehicle (RKV), the presumptive successor to the current Exoatmospheric Kill Vehicle (EKV), was scuttled in 2019 due to budget cuts, fewer test opportunities, and an accelerated development. In its place the Pentagon has committed to developing the Next Generation Interceptor (NGI) to counter ICBM threats, but this will not be an active missile defense system until at least 2026, and some experts estimate it may not be operational for as many as 12 years. This leaves a strategic capability gap. The United States should therefore make immediate investments in missile capabilities to counter current Chinese threats.

Fully funding theater and strategic missile and missile defense programs offer the most effective means to deter China. The new medium and intermediate range missiles under development for the U.S. Army and Navy, air-launched hypersonic missiles, tactical nuclear cruise missiles, and the game-changing 1,000 mile-range Long Range Strategic Cannon are required to achieve theater parity with China. Having practiced strategic missile defense cooperation, it has to be considered that China and Russia may engage in nuclear missile offense cooperation, making it crucial to fund U.S. nuclear triad modernization.

It is also crucial to fund current theater and strategic missile defense programs to fill the gap while the NGI is being developed. Interceptors such as the Navys SM-3 and SM-6 missiles, systems such as Aegis Ships and Aegis Ashore, and an extended-range version of the Theater High Altitude Area Defense (THAAD) system are all examples of proven, cost-effective technologies that the United States can procure now to counter current threats while simultaneously investing in technological advances to meet growing long-term demand.

Such commitments will be essential to meet Chinas nuclear challenge and convince Beijing to finally consider verifiable nuclear limitation agreements. Congress and the Trump administration must ensure funding for them when the time comes for post-coronavirus U.S. defense spending adjustments.

Get first-read access to major articles yet to be released, as well as links to thought-provoking commentaries and in-depth articles from our Asia-Pacific correspondents.

Richard D. Fisher, Jr. is a senior fellow with the International Assessment and Strategy Center.

More:
Missile Investments Are Needed to Meet China's Nuclear Challenge - The Diplomat

To say the stock market has been volatile in recent weeks would be a bit of an understatement. As you watch stock prices rise and fall dramatically over the course of a week while the coronavirus crisis unfolds, it's hard to know exactly what to do with your money.

After careful consideration, though, I've decided on two tactics I plan to stick with during the crisis. And depending on your situation, the approach I've chosen could possibly work for you as well.

Image source: Getty Images.

My investment accounts have lost quite a bit of money in recent weeks. In fact, one account primarily invested in index funds erased basically all of the gains over the past several years, and I'm now slightly down on an account I was up over 10% on at the end of February.

While it's hard to watch my balance fall without being tempted to take all the money out so I don't suffer any further losses, I'm making no changes at all to my current investments.

That's because I'm invested in a diverse mix of different assets and I have an appropriate amount of stock exposure relative to my age and retirement goals. I was confident in my investment strategy before the crisis started, and I know I'm still doing the right things to earn around a 7% to 8% average annual return over time.

There's no reason for me to sell stocks during an emotional time or to make changes to a well-balanced portfolio just because I'm nervous about the economy in the short term.

Not only am I not selling any of my investments, but I'm also increasing the amount of money I'm putting into the stock market. And I'm doing this by buying more of each of my index funds every two weeks.

I normally make regular contributions and purchase a little more of each index fund I'm currently invested in every time I do that. I've simply increased those contributions and am continuing to up my stake on a fixed schedule.

I'm doing this because I know it's really difficult to figure out what days the market will move up and what days it will decline. And it's impossible to try to time when stocks will hit bottom.

I personally think the market is likely to keep going down for a while because the economic fallout of social distancing will be far-reaching. But since I don't have a crystal ball, I don't know when the recovery will start. I'm also not worried about it because, with my steady schedule of investing, chances are good I'll get a great deal on at least some of my investments.

And yes, I'll pay more if I buy on an up day, but I'm a long-term investor putting money into the market that I won't need for more than a decade. Over time, it won't much matter if I paid slightly more than I could have for some of my shares. I'm confident my account balance will grow as expected based on historical trends. And by buying now during an unprecedented crisis when stocks are on sale, I may even beat my projections on some of those investments.

Staying the course and increasing my investing are the right choices for me because I'm confident in my strategy and I already have accessible emergency savings for the short term.

If you're in a similar situation, you may also decide to keep your current investments as they are and to add more money to the market on a regular basis. This strategy is likely to pay off, if it's one you're in a financial position to pull off.

Go here to read the rest:
This Is How I'm Handling My Investments During the Coronavirus Crisis - The Motley Fool

C&D International Investment Group (HKG:1908) shareholders are no doubt pleased to see that the share price has had a great month, posting a 34% gain, recovering from prior weakness. And the full year gain of 13% isn't too shabby, either!

All else being equal, a sharp share price increase should make a stock less attractive to potential investors. In the long term, share prices tend to follow earnings per share, but in the short term prices bounce around in response to short term factors (which are not always obvious). So some would prefer to hold off buying when there is a lot of optimism towards a stock. Perhaps the simplest way to get a read on investors' expectations of a business is to look at its Price to Earnings Ratio (PE Ratio). Investors have optimistic expectations of companies with higher P/E ratios, compared to companies with lower P/E ratios.

See our latest analysis for C&D International Investment Group

C&D International Investment Group's P/E of 5.19 indicates relatively low sentiment towards the stock. The image below shows that C&D International Investment Group has a lower P/E than the average (6.2) P/E for companies in the real estate industry.

SEHK:1908 Price Estimation Relative to Market April 19th 2020

Its relatively low P/E ratio indicates that C&D International Investment Group shareholders think it will struggle to do as well as other companies in its industry classification. Since the market seems unimpressed with C&D International Investment Group, it's quite possible it could surprise on the upside. It is arguably worth checking if insiders are buying shares, because that might imply they believe the stock is undervalued.

Generally speaking the rate of earnings growth has a profound impact on a company's P/E multiple. When earnings grow, the 'E' increases, over time. Therefore, even if you pay a high multiple of earnings now, that multiple will become lower in the future. Then, a lower P/E should attract more buyers, pushing the share price up.

C&D International Investment Group's earnings per share grew by 3.1% in the last twelve months. And its annual EPS growth rate over 5 years is 89%.

One drawback of using a P/E ratio is that it considers market capitalization, but not the balance sheet. That means it doesn't take debt or cash into account. In theory, a company can lower its future P/E ratio by using cash or debt to invest in growth.

Such expenditure might be good or bad, in the long term, but the point here is that the balance sheet is not reflected by this ratio.

C&D International Investment Group's net debt is considerable, at 278% of its market cap. This level of debt justifies a relatively low P/E, so remain cognizant of the debt, if you're comparing it to other stocks.

C&D International Investment Group has a P/E of 5.2. That's below the average in the HK market, which is 9.6. It's good to see EPS growth in the last 12 months, but the debt on the balance sheet might be muting expectations. What we know for sure is that investors are becoming less uncomfortable about C&D International Investment Group's prospects, since they have pushed its P/E ratio from 3.9 to 5.2 over the last month. If you like to buy stocks that could be turnaround opportunities, then this one might be a candidate; but if you're more sensitive to price, then you may feel the opportunity has passed.

Story continues

Investors should be looking to buy stocks that the market is wrong about. If the reality for a company is not as bad as the P/E ratio indicates, then the share price should increase as the market realizes this. So this free visualization of the analyst consensus on future earnings could help you make the right decision about whether to buy, sell, or hold.

You might be able to find a better buy than C&D International Investment Group. If you want a selection of possible winners, check out this free list of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

See the article here:
What Is C&D International Investment Group's (HKG:1908) P/E Ratio After Its Share Price Rocketed? - Yahoo Finance

April 19, 2020

Steven Bleibergis Managing Director and Portfolio Manager at Epoch Investment Partners, Inc. He is involved with the design and development of investment strategies and is a contributor to Epochs thought leadership.

Earlier, he was a portfolio manager at Legg Mason responsible for managing $7.5 billion in various asset allocation-based funds including Target Risk, Target Date and Dynamic Risk Management.

Prior to that, he was the head of investment strategy at Citigroup Asset Management and a portfolio manager at Credit Suisse Asset Management.

He is a co-author ofWinning at Active Management: The Essential Roles of Culture, Philosophy and Technology. He received a bachelors degree from Harvard and a masters degree from the Sloan School of Management at MIT, with a concentration in finance.

In this 3,678 word interview, exclusively with the Wall Street Transcript, Mr. Bleiberg reveals many of his top picks and the investment philosophy that determines them.

If you were going to go out and buy a business yourself to own 100% of it, how would you focus on it, or how would you make that decision, first, whether to do it and, second, how much to spend?

You would not look at what the accounting earnings are going to look like each year for the next 10 years. What you would want to know is: How much cash is it going to cost me out of pocket today to buy this business, and how much cash is going to flow into my pocket each year going forward?

Thats how you would analyze it. And to us, buying stocks, even though youre not going to be buying the whole company, thats still the right way to think about it because youre trying to figure out what is this business worth to me as an owner.

This leads Mr. Bleiberg to focus his stock picks on several high return strategies:

So with the strategy, which we call Capital Reinvestment, we might like a company such as Visa(NYSE:V) orMastercard(NYSE:MA) because they have very high margins.

If you think about their marginal cost if I go to the store, and I charge something on myVisacard, they collect their fee as a percentage of what I spent at the store. But their marginal cost for processing that transaction is extremely low. I mean, this is all automated.

And so its a very high-margin business. So thats what drives the high return on invested capital there.

Get all the most important picks from Epoch Investment Partners by reading the entire 3,678 word interview, exclusively with the Wall Street Transcript.

Read the original post:
Epoch Investment Partners Has the Right Attitude to Owning Their Portfolio - The Wall Street Transcript

Many Americans will soon be receiving a coronavirus stimulus payment from the IRS. Depending on your income, you could receive up to $1,200 per adult and an additional $500 per child dependent in your household.

When you get this big, lump-sum payment, you'll have to decide what to do with it. You have three options, and the right one will depend on your existing financial situation.

Image source: Getty Images.

The stimulus check is meant to provide income for Americans who need it because coronavirus adversely affected their finances. If you've lost your job, unemployment benefits haven't started yet, and you need money to cover food or bills immediately, spending your check is the right option.

It's true that most creditors will work with you now, suspending late fees and allowing you to put loans into forbearance so you won't have to make payments. Most renters also are protected by federal or state moratoriums on eviction, and utility companies generally can't cut off power during the coronavirus crisis.

But that doesn't mean you shouldn't pay your bills if you can -- even if you need your stimulus money to do so. Interest won't stop accruing on your debt even if it's put into forbearance (except for most federal student loans), and rent and utility payments will continue to be due (the amount you owe won't just be forgiven). So, if you stop paying now, you could end up owing a lot later, which would make it harder to get back on your feet financially.

If you have the money to cover your bills but you have no liquid emergency savings, or your emergency fund is very small, the best thing to do with your check is put it in the bank.

You don't want to make your money inaccessible to you by investing in assets you can't easily get out of. And since the stock market is very volatile right now, you don't want to invest it and risk losing some of it right away in case you end up needing it.

If you have emergency savings sufficient to cover three to six months of living expenses, and you don't need your stimulus money to pay bills, investing your check is likely your smartest choice.

Investing your money now enables you to take advantage of the economic downturn to get into index funds or buy stocks of great companies at potentially discounted prices. There are some great investment buys you could take advantage of right now, even with as little as the $1,200 the stimulus money provides.

You could use the money to bulk up your retirement accounts, depositing it into your IRA and scoring tax savings. Or you could open a taxable brokerage account if you want to be able to access the funds before age 59 1/2.

Just be sure not to invest money you're likely to need in the next five years, as you want to make sure you can leave the cash invested long enough to recover from any market downturns.

Your stimulus money is meant to help improve your financial situation, and it can do that whether you use it now to avoid consumer debt or invest it to build a more secure future.

Choosing whether to save or invest your stimulus money will depend on whether you're currently in a good financial position or if you need a little extra help to shore up your finances during troubled economic times.

Originally posted here:
Should You Save or Invest Your Stimulus Money? - The Motley Fool

One conundrum that some investors face is how to capture the safety of bonds while trying to get in on riskier stock-like returns.

Enter convertible bonds.

These hybrid investments are corporate-issued bonds that pay interest generally higher than U.S. Treasury rates but lower than those on regular corporate bonds. After a predetermined length of time usually four to seven years or when the company's shares reach a certain price, the convertibles convert to a certain amount of stock.

"They give you the opportunity to get upside potential but also downside protection," said Zachary Patzik, a fixed income strategies analyst at Morningstar. "If you look at how the performance has been over the years, it's been a pretty solid stream for investors."

Image Source | Getty Images

The U.S. convertible bond market is worth about $200 billion, a small slice of the full investing universe. While there are mutual funds and exchange-traded funds that focus on convertibles, other funds or investment managers also use them as part of a broader strategy.

Convertible bonds are not without risk. Often, the companies issuing them may have weaker credit ratings, or have generally less immediate financial soundness but good growth potential.

Cruise line operator Carnival, for instance, recently issued $1.75 billion in convertible bonds with a 5.75% interest rate. The company has taken a big hit to revenue as the coronavirus pandemic and resulting economic fallout has upended the travel industry. Carnival's stock price has plummeted this year to about $12.50 from above $38, a drop of about 75%.

While Carnival may very well recover, an investor in any convertible bond runs the risk that the issuing company will go belly up before the conversion happens. Of course, there's always the bankruptcy danger with individual stocks, as well.

"If you're looking for bond exposure, where you want a portion of your portfolio to not behave like stocks, then convertibles aren't what you should be buying," said certified financial planner Kashif Ahmed, president of American Private Wealth in Bedford, Massachusetts. "When stocks fall, convertibles do, as well."

The Standard & Poor's 500 index, a broad measurement of how U.S. companies are faring, was down 20% in the first quarter. Likewise, the Dow Jones industrial average was down about 23% in that time period.

While convertible bonds slid, as well, the loss was less: a bit under 13% in the convertible funds tracked by Morningstar.

"We like them because they ameliorate risk," said CFP David Demming, founder and president of Demming Financial Services in Aurora, Ohio. "They provide the opportunity to earn high single digits or even maybe low double digits.

"They won't be the highest-performing, but they add a different dimension to your portfolio."

Of course, with economic conditions worsening in the U.S. and questions over whether all hard-hit companies will come out of this intact, it's worth being cautious.

"In this environment, if convertible bonds are available at a reasonable price, smart managers aren't just blindly buying them, they buy what's attractive," Demming said.

More from Personal Finance: Can't keep up with insurance premiums? Here's what to do What you should know about the cost of coronavirus treatment What to expect if you have a 401(k) loan and lose your job

Subscribe to CNBC on YouTube.

See original here:
Coronavirus-panicked investors may turn to this investment to get the best of both stocks and bonds - CNBC