Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Cross Asset Strategy

<div class="content-highlight">“Any public company that receives a bailout or significant funding should not be allowed, by law, to do stock buybacks EVER AGAIN as part of their agreement.” (Source: <a href="https://www.dallasnews.com/business/airlines/2020/03/18/american-airlines-spent-12-billion-on-stock-buybacks-during-flush-times-now-it-says-it-needs-a-bailout/" target="_blank" rel="noopener">Mark Cuban</a>, 18 March 2020)</div>Why are so many major U.S. companies suspending their share buyback programs right now when many of these stocks appear to be trading at bargain sales prices? This is certainly one of the major differences between the current environment versus back in 2008/2009 when numerous major U.S. companies used the emergency government proceeds to buy back their shares.In this analysis, we discuss the significant implication of this CHANGE in SENTIMENT among major U.S. companies to suspend their share buyback programs in the midst of the global COVID-19 pandemic outbreak. We have provided a list of 25 major companies in the U.S. that have announced share buyback program cancellations in the past week (15 to 21 March). Of these 25 companies, 17 of them are in the financial sector.

“Any public company that receives a bailout or significant funding should not be allowed, by law, to do stock buybacks EVER AGAIN as part of their agreement.” (Source: Mark Cuban, 18 March 2020)Why are so many major U.S. companies suspending their share buyback programs right now when many of these stocks appear to be trading at bargain sales prices? This is certainly one of the major differences between the current environment versus back in 2008/2009 when numerous major U.S. companies used the emergency government proceeds to buy back their shares.In this analysis, we discuss the significant implication of this CHANGE in SENTIMENT among major U.S. companies to suspend their share buyback programs in the midst of the global COVID-19 pandemic outbreak. We have provided a list of 25 major companies in the U.S. that have announced share buyback program cancellations in the past week (15 to 21 March). Of these 25 companies, 17 of them are in the financial sector.

Why Are Major U.S. Companies Suspending Their Share Buyback Programs?

Research and consultancy, Tabbush Report

Daniel Tabbush

Research and consultancy

Tabbush Report

We provide research and consultancy on Asian banks. Our focus is on what we call “Asian bank research, without the noise.” We are interested in the most critical swing-factors for banks, the NPL and credit cycle, and where we believe there is a gap between perception and reality. We often focus on the less studied components of bank financial statements.  Our research is highly thematic, sometimes examining unlisted banks and companies as a window on mainstream banks. 

Being independent allows us to look at smaller banks, often overlooked by others. Analysis of BIS bank guidelines in the context of Asia, is also a focal point, while we also analyze global banks operating in the region. We use what we believe is the most comprehensive, reliable financials database, SNL Financial. S&P Capital IQ augments our database, with corporate data and CEIC, with economics. 

Asian bank research, without the noise.

Thematic (Sector/Industry)

Visible signs are increasing of risks in the <a href="https://www.smartkarma.com/insights/credit-costs-us-banks" target="_blank">US credit market</a>, and especially in the <a href="https://www.smartkarma.com/insights/discover-financial-services-even-higher-charge-offs" target="_blank">consumer segment</a>. The latest data points are from Santander Consumer USA and <a href="https://www.smartkarma.com/entities/9121" target="_blank" data-smartkarma-citation="entities:9121:1">Credit Acceptance Corp (CACC US)</a>. Defaults on their subprime auto loans are rising, as are their bad loans.  Recall that it was Accredited Home Lenders, H&amp;R Block, Indymac and Household International which were the best lead indicators of the credit demise about to overtake the US market, some 12 years ago. With Santander’s comments…

Visible signs are increasing of risks in the US credit market, and especially in the consumer segment. The latest data points are from Santander Consumer USA and Credit Acceptance Corp (CACC US). Defaults on their subprime auto loans are rising, as are their bad loans.  Recall that it was Accredited Home Lenders, H&amp;R Block, Indymac and Household International which were the best lead indicators of the credit demise about to overtake the US market, some 12 years ago. With Santander’s comments…

Founder and Strategist, Entext Economics & Strategy

Sean Maher

Founder and Strategist

Entext Economics & Strategy

Entext provides institutional investors with distinctive, actionable asset allocation and thematic research, which typically challenges the market consensus. Our clients range from credit, equity and multi-asset hedge and pension funds to family offices and sovereign funds. 
 
We focus on identifying key inflection points in macro data and relative asset performance amid the 'groupthink'  and confirmation bias that characterizes most investment bank analysis.

Macro Driven Investment Insight

<ul>
<li style="text-align: justify;">Wall Street has projected its wildest fantasies onto the largely blank canvas Trump provided, but this is politics reinvented as performance art.</li>
<li style="text-align: justify;">As the lack of policy coherence or even consistency becomes painfully clear, investors risk a degree of buyer’s remorse, reflected in the stalling USD, financials etc. rallies.</li>
<li style="text-align: justify;">
Globally, the macro and inflation data surprise indices have spiked further YTD - the turnaround in the Eurozone is the most impressive and least expected by the consensus or…</li>
</ul>


Wall Street has projected its wildest fantasies onto the largely blank canvas Trump provided, but this is politics reinvented as performance art.
As the lack of policy coherence or even consistency becomes painfully clear, investors risk a degree of buyer’s remorse, reflected in the stalling USD, financials etc. rallies.

Globally, the macro and inflation data surprise indices have spiked further YTD - the turnaround in the Eurozone is the most impressive and least expected by the consensus or…


'America First' Agenda Remains Contradictory, Vietnam Trip Notes…

Public Relations and Social Media Manager, Dechert LLP

Peggy Heffner

Public Relations and Social Media Manager

Dechert is a global specialist law firm

Dechert LLP

Dechert is a global specialist law firm.
Focused on sectors with the greatest complexities, legal intricacies and highest regulatory demands, we excel in delivering practical commercial judgment and deep legal expertise for high-stakes matters.

Our work is widely recognized. We have 20 standout practices noted by Chambers Global, including global-wide rankings for arbitration, corporate investigations, anti-corruption, investment funds and life sciences. Named Antitrust Team of the Year, Chambers USA commends our “accomplished group” as “routinely sought after to handle some of the most significant litigation and transactions in the antitrust world.” 

In an increasingly challenging environment, clients look to us to serve them in ways that are faster, sharper and leaner without compromising excellence. We developed a first-of-its kind legal project management department, which uses technology, people and processes to drive efficiency and deliver value for our clients.

We are innovators. Dechert ranked #7 in the Financial Times’ Top North American Innovative Law Firms. Financial Times also recognizes us among the Top European Innovative Law Firms and highly commends World Compass, our marketing compliance service, which offers investment firms advice in more than 100 jurisdictions.

<ul><li>The presidential election has opened the possibility of significant changes to the Dodd-Frank Act regime that has been implemented over the last six years.</li><li>It remains to be seen what plans the incoming administration will bring to this area.</li><li>However, new regulatory proposals and other developments continue to present a complicated regulatory climate for banks and other large financial institutions.</li></ul>

The presidential election has opened the possibility of significant changes to the Dodd-Frank Act regime that has been implemented over the last six years.It remains to be seen what plans the incoming administration will bring to this area.However, new regulatory proposals and other developments continue to present a complicated regulatory climate for banks and other large financial institutions.

The New Future of US Banking and Financial Services Regulation

Campaign promises rarely turn into specific actions, but when they do, they are necessarily impacted by the dynamics of the legislative process. History suggests, however, that the policies of candidates can be a predictor of likely regulatory trends.

Campaign promises rarely turn into specific actions, but when they do, they are necessarily impacted by the dynamics of the legislative process. History suggests, however, that the policies of candidates can be a predictor of likely regulatory trends.

Implications of the 2016 Election for Banks and Systemically Important Financial Institutions

United States

Ally Financial Inc. is a automotive financial services company powered by a direct banking franchise. The Company operates as a financial holding company.

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Ally Financial (ALLY US)

US Credit Cycle – Revealing Frailties

Visible signs are increasing of risks in the US credit market, and especially in the consumer segment. The latest data points are from Santander...

Daniel Tabbush

'America First' Agenda Remains Contradictory, Vietnam Trip Notes…

Wall Street has projected its wildest fantasies onto the largely blank canvas Trump provided, but this is politics reinvented as performance...

Sean Maher

The New Future of US Banking and Financial Services Regulation

The presidential election has opened the possibility of significant changes to the Dodd-Frank Act regime that has been implemented over the last...

Dechert LLP

Implications of the 2016 Election for Banks and Systemically Important Financial Institutions

Campaign promises rarely turn into specific actions, but when they do, they are necessarily impacted by the dynamics of the legislative process....

Dechert LLP

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Why Are Major U.S. Companies Suspending Their Share Buyback Programs?

“Any public company that receives a bailout or significant funding should not be allowed, by law, to do stock buybacks EVER AGAIN as part of their...

Douglas Kim

US Credit Cycle – Revealing Frailties

Visible signs are increasing of risks in the US credit market, and especially in the consumer segment. The latest data points are from Santander...

Daniel Tabbush

'America First' Agenda Remains Contradictory, Vietnam Trip Notes…

Wall Street has projected its wildest fantasies onto the largely blank canvas Trump provided, but this is politics reinvented as performance...

Sean Maher

The New Future of US Banking and Financial Services Regulation

The presidential election has opened the possibility of significant changes to the Dodd-Frank Act regime that has been implemented over the last...

Dechert LLP

Implications of the 2016 Election for Banks and Systemically Important Financial Institutions

Campaign promises rarely turn into specific actions, but when they do, they are necessarily impacted by the dynamics of the legislative process....

Dechert LLP