Monthly Archives: July 2021

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Friday, July 16, 2021

It's already been a strong year for the U.S. stock market.

Through Thursday's close, the S&P 500 (^GSPC)is up 16.1% year-to-date, while the Dow (^DJI)and Nasdaq (^IXIC) are both up more than 12%.

But index-level gains, of course, don't tell the full story of what's happening in the market, today or otherwise. As Canaccord Genuity strategist Tony Dwyer told Yahoo Finance Live earlier this week, what we've seen underneath the surface of indexes hitting record highs is a rolling correction with factors, sectors, and styles moving in and out of favor.

"Most institutional investors...in general try to pick stocks and sectors," Dwyer told Yahoo Finance. "It's what they're paid to do. The frustration hasn't been the speed of the recovery in the markets, it's been the volatility in the sector rotation in the markets."

Dwyer added: "People that watch the markets, they pay attention to the S&P 500, they pay attention to NASDAQ, they're at new highs, it feels so exciting. But under the surface, most investors that I talk to, their guts are churning, which is why it's a summer of indigestion, because it's very hard to get a real theme, because of the rotation between growth and value under the surface."

Growth stocks, as measured by the Vanguard Growth Index ETF (VUG), have gained around 10% in the last two months, while the Vanguard Value Index ETF (VTV) is down 1.5% over that period; the S&P 500 has gained about 4.5% in that time.

Industrials (XLI), Materials (XLB), and Financials (XLF) have all underperformed the S&P 500 since June. Facebook (FB), Apple (AAPL), Amazon (AMZN), and Microsoft (MSFT) are all within 5% of record highs.

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The rally we've seen in the bond market where the 10-year Treasury yield has gone from around 1.75% to under 1.3% on Thursday helps form the base for this current market environment. All else equal, lower rates suggest slower economic growth ahead; they also lead investors to favor faster growing sectors like technology over sectors more sensitive to the economic cycle, like financials and industrials.

This rotation within the market has also hit notable pockets of froth like SPACs, new issues, and the meme trade. Through Thursday's trading session, shares of AMC (AMC) and GameStop (GME) were more than 40% below highs hit back in early June. Shares of the two companies have gained, of course, more than 1,400% and 700%, respectively, year-to-date. Recent new issues like Coinbase (COIN), Krispy Kreme (DNUT), Oatly (OTLY), and Didi (DIDI) have also traded unenthusiastically since going public.

But data from Bespoke Investment Group suggests that history is very much on the market's side this year. In years when the market acts this well in the first six months of the year, we tend to see further gains and limited downdrafts through the balance of the year.

In a report published Wednesday, Bespoke looked at the S&P 500's performance for each year since 1928, and pulled out the 10 years with year-to-date paths most correlated to 2021. In these similar years, the average gain for the S&P 500 through July 14 was 20.1%, with a median return of 18.8%.

"With this year's gain of 16.2%, the magnitude of the gains so far this year is relatively close to the median of the 10 prior years," Bespoke wrote.

"Looking ahead, the S&P 500's median rest-of-year performance in those 10 years was a gain of 7.1% with positive returns 70% of the time," the firm noted. "Compared to all years since 1928, the rest-of-year gain in these 10 years was considerably stronger than the median rest of year gain of 4.0% for all years since 1928."

In other words, during years in which the market has gone up with the force we've seen so far in 2021, the S&P 500 through the balance of the year tends to deliver stronger-than-normal returns as well.

Additionally, Bespoke notes that in only two of the 10 years most similar to 2021 has the second half featured a drawdown of more than 10%, with the median correction from highs only amounting to a 2.3% drop.

So not only do stocks continue grinding higher in this kind of environment, but they tend to do so with less-than-normal volatility. At least if you're buying the index.

By Myles Udland, reporter and anchor for Yahoo Finance Live. Follow him at @MylesUdland

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Market history suggests stocks will keep climbing this year - Yahoo Finance

LAS VEGAS Team USA mens basketball has been a subject of scrutiny for the last five days with the basketball community expressing its enormous disappointment in the team getting off to an unprecedented 0-2 exhibition start ahead of the Olympics in Tokyo.

Meanwhile, Kevin Durant, the face of Team USA, is just chilling in his hotel suite at Aria Resort & Casino.

Im doing fine, myself, Durant told Yahoo Sports. I havent really left my room with the health and safety protocols were following. Not really watching much [NBA Finals] basketball. Im just out here to hoop, stay safe and get better. The s*** people are saying doesnt bother me. Its all about context.

Team USA lost a shocker to Nigeria 90-87 in the friendly opener on Saturday and followed that up with a 91-83 stunning loss to Australia two days later. Before facing Nigeria, Team USA was 54-2 in exhibitions since 1992.

They were finally able to get off the schneid on Tuesday in routing Argentina 108-80.

Head coach Gregg Popovich has only been able to muster up a little under a handful of practices since training camp began last week. Durant said the reason hes unfazed by the slow start is because he knew what the team would be up against once camp kicked off.

Kevin Durant and Team USA have only practiced a handful of times before their exhibition slate started ahead of the 2021 Olympics. (Ethan Miller/Getty Images)

Were a team thats still coming together and trying to find our identity, Durant told Yahoo Sports. We have so many great players that you can play so many different ways, and we are indecisive at times on defense and offense. In the midst of us figuring it out, these teams are established and theyre running their sets. Were working on our sets. The stars were kind of aligned for us to lose early on.

There's the argument that with the abundance of talent on Team USA, and regardless of the lack in preparation time, these shortcomings shouldnt be materializing.

Durant noted that the context was important.

Its easy to say that after two losses without any context, Durant tells Yahoo Sports. Let's just go down the roster of each team and you can find the answer. If youre looking for NBA talent, those teams have it. Understand where were at as a team and then you can make assumptions for yourself. We do have all the best players in the league, but these national teams have NBA players, too, who are now No. 1 options and theyre used to playing that role internationally. Were still adjusting as a team, and thats not making excuses. There's a lot of context people need to understand. We didnt expect to lose a game, but losing games happen. Well get it right.

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If they are to find continuity, it wont be in the form of team gatherings in Las Vegas. Players for the most part, with the exception of a few, have been spending the bulk of their downtime with family and friends.

Whether we know each other or not, our jobs are on the basketball court, Durant told Yahoo Sports. All that extra s*** about bonding and all that other stuff is cool, but you win games by playing and performing well. Thats my focus. We just got to take the court ready to work. Were looking at going through a real progression as a team. Were not looking at it like were going to come out here and blow everybody out. We know its going to be a grind, and thats fine. It's a competition.

The Brooklyn Nets superstar being here is a miracle in itself after returning from a gruesome Achilles tear that cost him the entire 2019-20 season. Durant almost single-handedly advanced the Nets to the Eastern Conference finals.

Coming off of an injury like that, along with the workload he adopted late in the playoffs, he said there was never a doubt he wouldnt be joining the Olympic squad if he was healthy enough.

I just feel like this is what Im supposed to be doing with my life, he told Yahoo Sports. What the f*** am I supposed to do? I didnt need anybody to motivate me to play for my country. If I needed that, I wouldn't be here.

Team USA has two more exhibition games to play in Las Vegas before leaving for Tokyo next week, vs. Australia on July 16 and vs. Spain on July 18. Durant and company will have a chance to prove that theyre a better team than they were a week ago.

This Olympic go-around, the gold will not be as attainable as it has been for previous USA teams, although BetMGM still has them listed as the gold medal favorite (-400). But its a fight Durant says theyre up for accepting.

We knew it wasnt going to be easy, and were prepared to go to work, Durant told Yahoo Sports. Our goal [of winning gold] hasn't changed. We'll be ready.

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Kevin Durant on Team USA's struggles: 'The stars were kind of aligned for us to lose early' - Yahoo Sports

In the 2020 CARES Act, Congress gave student-loan borrowers a temporary break from repaying their loans. President Trump extended that twice and President Biden once, with loan payments now set to resume Oct. 1, 2021.

Borrowers could have kept paying if they wanted to, but almost nobody did. As Tom Lee of the American Action Forum recently explained, the portion of borrowers repaying their student loans dropped from 46% at the beginning of 2020 to 1% today. The portion of borrowers in forbearance rose from 10% to 57%. The rest include borrowers who are still in school, who have gotten deferments or who have defaulted.

Source: American Action Forum, Dept. of Education

Theres no shame in accepting an emergency benefit the government offers during a pandemic. Its also financially shrewd to put off repayment of a loan, as long as theres no penalty. But the massive student-loan deferment may have set the stage for a chaotic resumption of payments this fall, or politically explosive intervention by the Biden administration that could impact upcoming elections.

Some Democrats, including Senators Chuck Schumer and Elizabeth Warren, want Biden to extend the repayment deadline into 2022. Another group of Democrats wants Biden to forgive $50,000 in debt for every student-loan borrower. Biden has said he might consider canceling up to $10,000, but its not clear he has the legal authority to do that, and the high cost could torpedo funding for other priorities if he did.

[Will a resumption in student loan payments cause you financial hardship? We'd like to hear about it.]

Americas $1.4 trillion in federally backed student debt has become a cultural and generational flashpoint as politicians debate what, if anything, to do about it. Liberal Democrats feel some or all of the 40 million student-loan borrowers deserve relief, since the average amount owed per borrower has exploded to nearly $37,000. The growth in average balances has far exceeded inflation or income growth. The hardest cases are students who take on debt but never get a degree or the extra earning power that comes with it.

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As college students around the country graduate with a massive amount of debt, advocates display a hand-painted sign on the Ellipse in front of The White House to call on President Joe Biden to sign an executive order to cancel student debt on June 15, 2021 in Washington, DC. (Photo by Paul Morigi/Getty Images for We The 45 Million)

The economic case for canceling student debt is extremely weak, however. It would be a massive handout to a subset of Americans with better economic prospects than others, with no similar benefit for those worse off or those who already paid what they owe. "It would be a terrible thing to do, says Sandy Baum, a senior fellow at the Urban Institute. Making those handouts and excluding the people who have never been to college is totally inequitable. What about people who start borrowing tomorrow? Are we going to forgive debt every few years?

Even if Biden cancels no student debt, theres still a hidden cost to taxpayers of deferring it, as Congress has done. The government would normally collect interest on money it has loaned, which it is not doing at the moment. Perhaps more important, the government cancels outstanding debt for qualifying undergraduate borrowers after 20 years if they make the required income-based payments. The deadline for borrowers with graduate-student debt is 25 years. Those deadlines have not changed, so the moratorium has effectively shortened them by nearly a year and a half. A borrower paying $300 a month in undergrad loans who hits the 20-year limit with more than 18 months of payments left would save $4,800 in todays dollars by taking advantage of the moratorium. For the borrower, thats a no-brainerbut the cost falls on future taxpayers.

Nobody is sure what will happen if student-loan payments resume as now scheduled at the beginning of October. Congress created the grace period at the beginning of the pandemic, when it seemed mass layoffs were imminent and a prolonged recession was likely. There were huge job losses in the second quarter of 2020, but the economy bounced back faster than many economists expected. By some measuressuch as overall GDPthe economy is back to where it was before the pandemic.

There are still 6.8 million fewer jobs than before the pandemic. But some of those people have deliberately pulled out of the labor force, to care for kids or return to school. Some are still worried about Covid in the workplace. Others are holding out until unemployment benefits expire. At the same time, virtually all the pandemic relief has come from borrowed money that adds to the national debt, which Republicans are sure to use as a cudgel against Biden and his fellow Democrats in the 2022 midterm elections.

Graduating students at Pasadena City College wear decorated academic caps at the school's graduation ceremony, June 14, 2019, in Pasadena, California. (Photo by Robyn Beck / AFP)

For all the attention their financial woes get, student debt borrowers are better off than the population at large, since theyre more likely to have a college or graduate degree, or be in the process of getting one. College grads were much more likely to remain employed during the pandemic than those without a degree, so most borrowers who were able to pay off their loans before the pandemic will probably be able to do so once the grace period expires. That would still leave more than 5 million borrowers in default and others on the verge.

Still, resumption of payments could be rocky. A group of Democrats has warned that student loan borrowers risk being thrown into extraordinary financial hardship when the current pause on payments ends. At a minimum, there could be bureaucratic snafus that create paperwork headaches, and some borrowers could miss payments if automatic restarts misfire. The pause in payments surely helped, but the test now is how well those borrowers prepared for the end of the pause.

Rick Newman is the author of four books, including "Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman. You can also send confidential tips, and click here to get Ricks stories by email.

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Britney Spears nabbed a big win in her conservatorship battle this week, after Judge Brenda Penny ruled that the pop star can now hire the attorney of her choosing.

On Wednesday, the singer appeared over the phone for the second time in two years following last month's headline-making hearing in which the 39-year-old pop icon claimed she's been "traumatized" by an "abusive" legal arrangement that grants her father, Jamie Spears, broad authority over her personal and financial affairs, including her estate that's estimated to be worth $60 million.

Mathew Rosengart, a former prosecutor and prominent Hollywood lawyer whose client list includes A-listers from Ben Affleck to Steven Spielberg, was formally approved to represent the singer. He is largely expected to take a more aggressive approach, telling the courts on Wednesday that he intends to file paperwork in the next few weeks to formally end the conservatorship.

"The victory of allowing her to choose her own counsel was huge," Benny Roshan, an L.A.-based attorney who serves as chair of Greenberg Glusker's trusts and probate litigation group, told Yahoo Finance.

Roshan explained it was a victory because the singer's voice was heard, but the ruling also demonstrated albeit indirectly that she is capable of making her own decisions.

"Britney basically illustrated through her own testimony to the court that she had the capacity to hire a lawyer...and when you're under a conservatorship, typically that means that a court has found you not capable to enter into a contract but hiring a lawyer is just that," she said.

The temporary conservator of her person, Jodi Montgomery, previously filed a petition to appoint a "guardian ad litem," an advocate appointed by the court to act on behalf of Spears to help her hire a lawyer.

Roshan said the court essentially "ruled that [a guardian ad litem] makes no sense by allowing Britney to choose her own attorney" yet another example of her capacity to make decisions.

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"The writing is on the wall that this conservatorship is going to come to an end," Roshan speculated.

Yahoo Finance reached out to Jamie Spears' legal team for comment and has yet to hear back.

The next major moment in Spears' case will be once she, along with her legal team, file the formal petition to end the conservatorship.

Following that, Jamie Spears could, and likely will, file an opposition.

"It's going to get uglier and uglier," Roshan warned, "unless her father sees the writing on the wall and starts jumping ship like others and voluntarily resigns," the attorney added.

In recent days, financial company Bessemer Trust, previously selected to serve as co-conservator of the pop star's estate, along with Spears' former court-appointed lawyer Sam Ingham and even her longtime manager Larry Rudolph all resigned from their positions.

At Wednesday's hearing, Britney tearfully called for an investigation of her father, citing conservatorship abuse, according to multiple reports.

"I definitely think that there's going to be a two-fold litigation strategy with this," Roshan said, suggesting that Britney Spears' fight might not end if and when she is freed from the arrangement.

"Another question is whether or not [Spears and her legal team] are going to make good on their threat to hold people who abused the conservatorship process and exceeded their authority accountable," she explained, adding that there are "broad remedies" available should they decide to further prosecute.

One possibility includes the disgorgement of any fees the individuals in question collected throughout the course of the arrangement. Spears currently pays hundreds of thousands of dollars every year in fees related to the conservatorship.

The next hearing in this case is scheduled for September 29.

Forbes estimates that the pop star's net worth sits at approximately $60 million, with $56.5 million of that sum resting in business accounts and investment properties. According to the publication, her gross income is divided among a mix of agents, managers, lawyers, state and local taxes, and then her personal expenses.

Each year, Spears pays about $500,000 in child support to ex-husband Kevin Federline, plus millions in legal support and fees related to her conservatorship, Forbes said.

Editor's Note: This article has been updated to reflect Yahoo Finance's efforts to reach Jamie Spears' legal team in response to the conservatorship developments and Britney Spears' allegations

Alexandra is a Producer & Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193

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Lawyer: 'Writing is on the wall' that Britney Spears' conservatorship will end - Yahoo Finance

The growing number of COVID cases in the U.S. indicates a major divide between the vaccinated population and those who choose to remain unvaccinated.

The 7-day moving average of new cases increased by 16% last week, according to CDC data, and roughly 93% of those cases were among counties with low vaccination rates.

The problem is we have a tale of two pandemics, Dr. Andre Campbell, a California-based ICU physician and trauma surgeon, said on Yahoo Finance Live recently (video above). Where I live in San Francisco We have 70-80% of people vaccinated. But if you go to other places in the South, the vaccination rate is 30 to 40%.

Much of this stems from political polarization: Republican-dominated areas, some led by politicians who have added vaccine skepticism to their messaging, generally have lower vaccinated rates.

What Im fearing is this: These pockets where people are not vaccinated in the South, what happens in the fall when it comes back again which it will there are going to be outbreaks, Campbell said. And things like whats going on in Missouri right now: In Missouri, theres a horrible outbreak among unvaccinated people and theyre calling for help.

In Missouri, which is seeing a 7-day moving average of 1,597 new cases, 73% of the cases have been linked to the Delta variant, according to the CDC. Only 39.8% of the population in the state is fully vaccinated.

Its almost like New York again, where theyre placing calls for doctors, respiratory therapists... so what were trying to do is get to the point where we could get more people vaccines because thats the thing that will get us out of this, Campbell said.

There are currently three vaccines available in the U.S.: Pfizer (PFE)s, Moderna (MRNA)s, and Johnson & Johnson (JNJ)s.

All three are said to be at least somewhat effective against the strains of the virus, including the newer Delta and Lambda variants.

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In Maryland, they just reported that 99% of people who got COVID were not vaccinated, Campbell said. The reality is the vaccines protect you now, even against the Delta variant. Theres a Lambda variant today. They just came out with another double variant and you have to remember, these viruses are built to mutate. So the more theyre out in the general population of unvaccinated people, the more it puts people at risk.

May 14, 2021; Baltimore, Maryland, USA; Spectators dress for Black-Eyed Susan Day while following COVID protocols at Pimlico Race Course. (Photo: Mitch Stringer-USA TODAY Sports)

The percentage of those vaccinated with at least one dose in Mississippi is just 37%, with Louisiana not far behind at 39%. Other states lagging include Tennessee, Alabama, Wyoming, and Idaho. Concurrently, most of those states are seeing a significant uptick in cases over the last 14 days.

The thing were worried about is that in the last week or so, the rate of infections [nationally] has gone up about 50%, Campbell said. That may be tied to the reopening and people not masking because the masking mandates are starting to go away. These are mainly in people who are not vaccinated. If you are vaccinated, you are very protected against all the variants we have right now.

Consequently, Campbell stressed the importance of trying to convince unvaccinated individuals to reconsider their discussion.

What we have to do is were going to have to strike up a very subtle discussion to make sure people understand that we want to make sure theyre protected, Campbell said. There will be some masking mandates, because this thing is not going to go away like we hope it will unless we go on an international campaign to eradicate this thing, much like what happened with smallpox and other things like that, because were not there yet right now.

Croix Hill receives her first dose of the COVID-19 vaccine at the Ochsner Center for Primary Care and Wellness in New Orleans, May 13, 2021. REUTERS/Kathleen Flynn

Out of more than 157 million people vaccinated in the U.S., there have been under 5,200 breakthrough cases that led to hospitalization or death as of July 6. Thats a paltry 0.003% rate.

"Youre not a guinea pig," Campbell said, referring to the safety of the vaccine. "310 million people have gotten this thing and theyve been saved. I think the message is: 'Its safe. Itll protect you and youre not going to die, or youre not going to get really sick.'

Furthermore, as various version of the virus continue to circulate, unvaccinated people are at risk.

If youre unvaccinated, youre in trouble," Campbell said. "If youre vaccinated, youre going to be safe.

Adriana Belmonte is a reporter and editor covering politics and health care policy for Yahoo Finance. You can follow her on Twitter @adrianambells and reach her at adriana@yahoofinance.com.

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Coronavirus: 'We have a tale of two pandemics' in America - Yahoo Finance

This week, second-quarter earnings season will ramp up, offering investors a fuller picture of the extent of the rebound in corporate profits as social distancing standards eased. Data on the housing market will also be in focus.

So far, companies have been topping already-elevated expectations for second-quarter results. About 8% of S&P 500 companies have reported results so far, mostly comprising banks. And of those reporting, 85% have topped estimates, according to FactSet data.

One of the most closely watched quarterly reports this week will come from Netflix (NFLX) on Tuesday. As the first of the "FAANG" names to post results, the report will set the tone for the other Big Tech companies still left to post their quarterly earnings.

Investors are nervously eyeing Netflix's second-quarter earnings report after a sharply disappointing first quarter, during which the streaming giant added fewer than 4 million new paying subscribers versus the 6.3 million expected. At its peak during the pandemic, Netflix had added nearly 15.8 million new subscribers in a single quarter. In April, Netflix attributed the first-quarter subscriber miss to "the big COVID-19 pull forward in 2020 and a lighter content slate in the first half of this year, due to COVID-19 production delays."

Netflix said it only expected to add 1 million new subscribers for the April through June quarter. The company added more than 10 million new paying users during the same period in 2020 when the pandemic still kept consumers mostly confined to their homes in search of entertainment.

But the slowing rate of new subscriber additions for Netflix has come alongside the maturation of the platform in major markets. With nearly 208 million global subscribers, Netflix is still the clear U.S. leader in streaming content, followed by a wide margin by Disney+ with 103.6 million subscribers. And Disney's streaming competitor also missed estimates for new subscriber additions at the start of the year, underscoring the industry-wide slowdown following the record droves of customer sign-ups during the height of the pandemic.

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SPAIN - 2021/07/13: In this photo illustration a close-up of a hand holding a TV remote control seen displayed in front of the Netflix logo. (Photo Illustration by Thiago Prudencio/SOPA Images/LightRocket via Getty Images)

"Netflix has a considerable first-mover advantage, with nearly 210 million global subscribers. This figure, however, belies the fact that Netflix is approaching market saturation in North America, with its nearly 75 million members comprising around 60% of all households," Wedbush analyst Michael Pachter wrote in a note.

"Its first-mover advantage will only take it so far, as it must continue to produce new content in order to retain existing subscribers, and must continue to renew licensed content in order to attract new subscribers," he added. "Netflixs opportunities overseas remain compelling, and we think this will support high single digit percentage user growth for the foreseeable future."

But in terms of new content, Netflix is reportedly pushing to expand its content outside of its core television and film programming. The company said last week that it hired Mike Verdu, former Electronic Arts (EA) and Facebook-owned (FB) Oculus executive, as vice president of game development. According to a report from Bloomberg, Netflix is aiming to offer video games to users in the next year. Investors are poised to eye Netflix's earnings report this week for more details about the strategy for the new business offering.

According to Truist Securities analyst Matthew Thornton, Netflix's foray into gaming would be "an extension of their content strategy," much like the streaming platform's other recent moves into unscripted content, premium films and children's programming.

"There is an opportunity here, at least at the margin, to differentiate the service versus some of their direct peers and help drive engagement, retention, and of course, subscriber growth and revenue growth," Thornton told Yahoo Finance Live. "What the content strategy will be here still remains to be seen. Are they going to keep this to their own first party content only, build their own content?"

"I think, you know, the biggest opportunity, of course, would be to actually open up to third party content as well, which would put them a little more head to head and comparable to the platforms out there that are offered by Microsoft, or Sony, or Nintendo, Google, Amazon, and others," he added.

In terms of top- and bottom-line results, Netflix is expected to deliver earnings of $3.16 per share on revenue of $7.32 billion, which would represent growth of 19% over last year.

Shares of Netflix have declined by about 1% for the year-to-date, underperforming against the S&P 500's nearly 16% rise over the same period.

A slew of housing market data is also due for release this week.

These will include the Commerce Department's report on housing starts and building permits, highlighting the pace of new home construction and future construction as tight inventory levels continue to weigh on housing market activity. Housing starts are expected to rise by 1.2% month-on-month in June for a back-to-back monthly gain, albeit while slowing from May's 3.6% monthly rise.

A drop in lumber prices after a spring surge is poised to help alleviate building costs and stoke construction. However, last week's retail sales report showed that both furniture and building material sales dipped in June, extending May's drop. The declines, however, may at least partially reflect drops in the actual price of building inputs like lumber, rather than or in addition to a pull-back in sales volume.

Other closely watched housing data this week will include the National Association of Realtors' monthly existing home sales report for June. This will likely register the first monthly increase in sales since January, with sales of previously owned homes anticipated to rise by 1.7% in June, according to Bloomberg consensus data. In May, existing home sales fell by 0.9%.

"We take positive signal from the 8% surge in May pending home sales, which hit the highest level since 2005. Existing home sales dropped for the fourth consecutive month in May, partly due to the high home prices squeezing out potential buyers in the market," Michelle Meyer, U.S. economist at Bank of America, wrote in a note on Friday. "The median price of an existing home in May marked the highest ever recorded at $350k, which was 23.6% higher compared with May 2020. That said, the inventory uptick in June and lowering lumber prices could bode well for buyers, potentially alleviating the pressure from the persistent high prices and tight inventory."

Monday: NAHB Housing Market Index, July (82 expected, 81 in June)

Tuesday: Housing starts, month-on-month, June (+1.2% expected, +3.6% in May); Building permits, month-on-month, June (+1.0% expected, -2.9% in May)

Wednesday: MBA Mortgage Applications, week ended July 16 (+16.0% during prior week)

Thursday: Chicago Federal Reserve National Activity index, June (0.30 expected, 0.29 in May); Initial jobless claims, week ended July 15 (350,000 expected, 360,000 during prior week); Continuing claims, week ended July 10 (3.241 million during prior week); Leading index, June (0.9% expected, 1.3% in May); Existing home sales, June (5.90 million expected, 5.80 million in May); Kansas City Federal Reserve Manufacturing Activity index, July (25 expected, 27 in June)

Friday: Markit U.S. Manufacturing PMI, July preliminary (62.0 expected, 62.1 in June); Markit U.S. Services PMI, July preliminary (64.5 expected, 64.6 in June); Markit U.S. Composite PMI, July preliminary (63.7 in June)

Monday: AutoNation (AN) before market open; IBM (IBM) after market close

Tuesday: Synchrony Financial (SYF), Philip Morris International (PM), Halliburton (HAL), Ally Financial (ALLY) before market open; Netflix (NFLX), Chipotle Mexican Grill (CMG), United Airlines (UAL) after market close

Wednesday: Anthem (ANTM), Johnson & Johnson (JNJ), Nasdaq (NDAQ), Coca-Cola (KO), Harley-Davidson (HOG), Verizon (VZ) before market open; Las Vegas Sands (LVS), Whirlpool (WHR), Texas Instruments (TXN), Equifax (EFX) after market close

Thursday: Danaher (DHR), DR Horton (DHI), AT&T (T), Newmont Corp (NEM), Dow Inc. (DOW), Abbott Laboratories (ABT), Alaska Air Group (ALK), Biogen (BIIB), American Airlines (AAL), Domino's Pizza (DPZ), The Blackstone Group (BX), Crocs (CROX), Southwest Airlines (LUV), Union Pacific (UNP), Capital One Financial (COF), Intel Corp (INTC), Boston Beer Co (SAM), Twitter (TWTR), Snap (SNAP)

Friday: American Express (AXP), Schlumberger (SLB), Honeywell (HON), Kimberly-Clark (KMB) before market open

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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Netflix earnings, housing data: What to know this week - Yahoo Finance

This article was originally published on Simply Wall St News.

Verizon Communications Inc. ( NYSE: VZ ) gets a lot of attention from institutional investors.

For Q1 2021, Berkshire Hathaway ( NYSE: BRK.A ) revealed a position of 146,716,496 shares - a stake valued at US$ 8.22b at the current price.

Ultimately, Verizon is a mature company that fits the mature investors expectations slow and continued growth with solid yields, as evident from the interest that it gets from Buffett.

Looking at the recent stock movement, even the volatility of 2020 didnt make a significant impact on the price. As the price has been stuck in a $50-$60 range for over 2 years.

Meanwhile, the company has been working on expansions, recently announcing an acquisition of Senion - a global leader in location-responsive solutions. The indoor location market is one of the latest booms as it solves the navigation problems in 3D space - something that the global positioning system (GPS) struggles at.

There are broad applications for this technology. From retail stores, warehouse operations, to emergency response services, Verizon is well-positioned to leverage its size to succeed in this field.

Furthermore, after selling the media business (with brands like Yahoo and AOL), Verizon freed up over US$ 5b to use in launching the 5G Ultra Network and grow its core business.

With Verizon Communications yielding 4.5% and having a 14-year history of dividend growth, it would not be a surprise to discover that many investors buy it for dividends. When buying stocks for their dividends, there are few factors to consider whether these dividend payouts are sustainable.

Click the interactive chart for our full dividend analysis

historic-dividend

NYSE:VZ Historic Dividend July 14th 2021

Dividends are usually paid out of company earnings. If a company is paying more than it earns, then the dividend might become unsustainable. So we need to evaluate if a company's dividend is sustainable, relative to its net profit after tax. Looking at the data, we can see that 55% of Verizon Communications' profits were paid out as dividends in the last 12 months. A payout ratio above 50% is in line with companys maturity, although it is not too high to be alarming.

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We also measure dividends paid against a company's levered free cash flow, to see if enough cash was generated to cover the dividend. Last year, Verizon Communications paid a dividend while reporting negative free cash flow. While this behavior is not sustainable, the last year was a Black Swan event where many dividend-yielding companies used reserves or even took on debt to pay out the dividend.

We update our data on Verizon Communications every 24 hours, so you can always get our latest analysis of its financial health, here.

From the perspective of an income investor who wants to earn dividends for many years, there is not much point in buying a stock if its dividend is regularly cut or is not reliable. Verizon Communications has been paying dividends for a long time, but for the purpose of this analysis, we only examine the past 10 years of payments. During this period the dividend has been stable, which could imply the business could have relatively consistent earnings power. During the past 10-year period, the first annual payment was US$2.0 in 2011, compared to US$2.5 last year. Dividends per share have grown at approximately 2.6% per year over this time.

Slow and steady dividend growth might not sound that exciting, but dividends have been stable for ten years, which we think is seriously impressive.

While dividend payments have been relatively reliable, it would also be nice if earnings per share (EPS) were growing, as this is essential to maintaining the dividend's purchasing power over the long term. Verizon Communications' earnings per share have been essentially flat over the past five years. Flat earnings per share are acceptable for a time, but over the long term, the purchasing power of the company's dividends could be eroded by inflation. Growth of 0.7% is relatively anemic growth, but then again, this is a mature company with a market cap of over US$ 227bn.

To summarise, dividend appeal triangulates between the companys ability to pay it in a sustainable way, stability of the payment itself, and the prospects of growth.

Verizon Communications gets a pass on its dividend payout ratio, but it paid out virtually all of its cash flow as dividends. This may just be a one-off, caused by the market turbulence, as the forecasts show over US$20b in free cash flow for 2021. Earnings have not been growing, but we like that the dividend payments have been fairly consistent, and the dividend payout ratio of 55% has a reasonable margin of safety.

In the short term, the ability to pay was questioned by the market downturn and the company responded by absorbing it through debt instead of diluting the shareholders or slashing the dividend. This means the company is confident about paying off the debt from its future earnings.

With that approach, the company kept the impressive dividend stability track record unharmed, while betting on the market recovery and new acquisitions to provide the much-needed growth.

Companies possessing a stable dividend policy will likely enjoy greater investor interest than those suffering from a more inconsistent approach. Still, investors need to consider a host of other factors, apart from dividend payments, when analyzing a company. To that end, Verizon Communications has 3 warning signs (and 1 which is a bit concerning) we think you should know about.

We have also put together a list of global stocks with a market capitalization above $1bn and yielding more than 3%.

Simply Wall St analyst Stjepan Kalinic and Simply Wall St have no position in any of the companies mentioned. This article 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. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

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Buffett is Buying Verizon Communications (NYSE: VZ) for its Stable Dividend - Yahoo Finance

Jared Drake Bell avoided jail time in his child endangerment case, but the claims against him were made public for the first time and they are disturbing.

Bell, best known for playing Drake in Nickelodeon's popular TV show Drake and Josh, has been sentenced to two years' probation plus 200 hours of community service. He cannot have contact with the victim. The 35-year-old previously pleaded guilty to one count of felony attempted child endangerment and one count of disseminating matter harmful to juveniles. He faced up to two years in prison.

During Monday's sentencing hearing, Bell virtually came face-to-face with the victim who called him "the epitome of evil." The woman, now 19, alleged in her impact statement she was sexually assaulted by the former child star on multiple occasions when she was 15. (Bell did not plead guilty to any crimes pertaining to sexual assault.)

Drake Bell has been sentenced to two years probation in his child endangerment case. (Photo: FilmMagic)

"He was such a huge part of my childhood, and in return, he ruined my life," she said at one point during her emotional 15-minute statement. "Every night I dread going to sleep because I don't want to see him in my nightmares."

The victim first met Bell in 2014, when she was only 12, through her aunt. She idolized the actor, calling him "a hero" and said she was his "biggest fan."

They texted for years, in which the teenager alleged she was groomed. The relationship developed online became sexual in nature when she turned 15. On Dec. 1, 2017, the victim attended Bell's Cleveland show where she claimed she was forced to perform a sexual act backstage. The next day, her aunt took her to say goodbye to Bell at a hotel where claimed she was forced to perform the sexual act again.

"Jared Drake Bell is a pedophile, and that is his legacy," the victim concluded.

Bell's attorney spoke after the teenager's tearful address to the court and made it clear the actor denies any sex act took place.

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"The claim that he is a pedophile lacks any sort of factual support," he told the judge, emphasizing Bell does not accept responsibility for that in his plea. The attorney also noted how "professionals" were engaged during the investigation and "there is no such finding" the actor is a "pedophile."

When the judge asked what exactly Bell is taking responsibility for, the lawyer acknowledged chats that were "sexual in nature."

Bell spoke before the judge's ruling but took his lawyer's advice and kept it brief as a civil suit is a possibility.

"I just want to say today that I accept this plea because my conduct was wrong. I'm sorry that the victim was harmed in any way," he said. "That was obviously not my intention. I have taken this matter very, very seriously and again, I just want to apologize to her and anyone else who may have been affected by my actions."

The judge could only issue a sentence based on the plea in front of him; however, he scolded Bell for inappropriate conduct.

"A grown man does not engage in inappropriate text messages to a teenager," the judge told him, saying he took advantage of the young girl with his celebrity status. "Your position and celebrity status allowed you to nurture this relationship."

Bell's sex offender status will be reviewed after probation.

While the actor hasn't addressed today's sentencing, he did return to social media after the Zoom hearing. Bell posted a video with his son, showing off the boy's face for the first time. The singer recently revealed he and wife, Janet Von Schmeling whom the victim claimed knew about the crimes secretly welcomed a child together.

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Drake Bell sentenced to 2 years probation for crimes against a child, victim says 'he ruined my life' - Yahoo Entertainment