Doral Financial Corporation’s Second Reverse Stock Split

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Puerto Rico-based Doral Financial (DRL) used to be a hi-flyer primarily due to sub-prime mortgage lending before the financial crisis. As the stock continued to plunge and headed towards $0.00 the bank implemented a reverse split on August 20, 2007 in the ratio of 1:20 when the stock reached a low of $0.54 a share.

The 2007 reverse split did not help stabilize the stock and it continued its downward decent soon after. In February of this year Doral reached a low of $0.53 a share again. The management instituted a second reverse split in the same ratio of 1:20 in July bringing back the share price above $17.00. Today Doral closed at $17.26. It will be interesting to see how long it takes Doral to go below $1.00 per share again.

The following ten-year returns chart shows the disaster that is Doral Financial Corporation:

Click to enlarge

\Doral

Source: Google Finance

Disclosure: No Positions

Safran SA Stock Split

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Safran SA(SAFRY), the French aerospace, defense and security firm has announced a stock split in the rate of 300%. The ADR Record Date is Nov 6, 2013 and the Payable Date is Nov 7, 2013.

Currently the ADR to Ordinary ratio is 1: 1. As a result of the split, the ratio will change as 1 Ordinary to 4 ADRs.  Hence ADR shareholders will receive 3 additional shares for each ADR held as of Nov 6, 2013 per a release by Citibank, the depository for this ADR program.

Here are some key facts from Safran’s Website:

SAFRAN AT A GLANCE (2012)
62,500 employees worldwide
€13,560 billion in sales
€1.6 billion in R&D expenditures

MARKET POSITIONS
No. 1 worldwide in engines for mainline commercial jets (partnership with GE)
No. 1 worldwide in landing gear, wheels and carbon brakes
No. 1 worldwide in helicopter flight controls
No. 1 worldwide in multi-biometric technology

Eric Forterre / Safran

The stock has more than doubled in the past 5 years as shown in the chart below:

Click to enlarge

Safran-5-years

Source: Yahoo Finance

Currently SAFRY has a 1.96% dividend yield.

Disclosure: No Positions

Argentinian Stocks Are On The Move

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Argentina was a pariah of global investors up until last year due to many reasons including the nationalization of the country’s oil company YPF in May.However investors have become bullish on Argentina for the past year according to an article in FT beyondbrics. The benchmark Merval index has almost doubled this year.

The following table shows the YTD performance of Argentina ADRs:

S.No.CompanyTickerClosing Share Price on Oct 24, 2013YTD ChangeIndustry
1EdenorEDN$6.10212.82%Electricity
2IRSA Inversiones y RepresentacionesIRS$12.1774.61%Real Estate Inv&Serv
3Pampa EnergiaPAM$5.9673.26%Electricity
4Grupo Financiero GaliciaGGAL$10.7962.99%Banks
5Telecom ArgentinaTEO$18.3761.42%Mobile Telecom.
6BBVA Banco FrancesBFR$8.0459.84%Banks
7Banco MacroBMA$27.6552.43%Banks
8YPFYPF$22.0051.20%Oil & Gas Producers
9Nortel Invesora - Series BNTL$20.5649.96%Mobile Telecom.
10Alto PalermoAPSA$23.4049.62%Real Estate Inv&Serv
11Transportadora de Gas del SurTGS$2.5343.75%Oil & Gas Producers
12CresudCRESY$11.5538.82%Food Producers
13Petrobras Argentina S.A.PZE$6.3533.68%Oil & Gas Producers
14TenarisTS$48.0514.62%Indust.Metals&Mining
15TerniumTX$25.658.92%Indust.Metals&Mining

 

Source: BNY Mellon

Related ETF:

Global X FTSE Argentina 20 ETF (ARGT)

Disclosure: Long BMA

 

Knowledge is Power: Sensex 21000, Piling into Stocks, African Banks Edition

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21,000, but who’s counting? (The Hindu Business Line)

Why U.S. Dollar Will Remain World’s Reserve Currency, Despite Political Brinkmanship (Charles Schwab)

Investors pile into Spanish recovery (EuroMoney)

Investors pile into Argentine stocks (beyondbrics)

Can the Goldilocks sweet spot continue? (Fidelity)

5 reasons to love dividends (Financial Post)

Africa’s Top 200 Banks 2013 (The Africa Report)

Missing Workers: The Missing Part of the Unemployment Story (EPI)

Going Defensive? 3 Things to Consider First (BlackRock)

The most successful British privatisations of all time (Trustnet)

World’s Safest Banks in Asia 2013 (Global Finance)

‘If you build it, they will come’ – Russia’s financial field of dreams (RT)

Europe Is Emerging Market as Germany to Greece Recover (Bloomberg)

EU-CompetitiveSource: DB Research

 

All Aboard The North American Railroad Stocks

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North American railroad stocks are on a tear. The railroad industry is dominated by a handful of Class I railroads that share the most of the freight traffic in the continent. Some of the factors the growth of railroad companies in the past few years include the shale oil boom in the U.S., limited pipeline capacity, issues with building new pipelines, growing shipment of coal and other commodities, etc. Despite the recent Lac Magentic tragedy in Canada the transportation of crude by rail has not declined and as the U.S. economy recovers railroads can be estimated to carry more freight.

Some of the railroad stocks are already trading over $100/share. Canadian National, Canadian Pacific(CP) and Norfolk Southern(NSC) have announced strong Q3 earnings with Canadian National (CNI) rewarding shareholders with a 2 for 1 stock split.

The following chart shows the 5-year performance of Canadian National vs. Canadian Pacific:

Click to enlarge

CN-vs-CP

 

The following chart shows the 5-year performance of major U.S. railroads trading on the markets:

US-Railroads

Source: Yahoo Finance

The biggest North American railroads article in the Financial Times gives a neat introduction of the railroads.

Here are the major railroad stocks with their current dividend yields:

1.Company: Canadian National Railway Co (CNI)
Current Dividend Yield: 1.50%
Country: Canada

2.Company: Canadian Pacific Railway Ltd(CP)
Current Dividend Yield: 0.94%
Country: Canada

3.Company: CSX Corp (CSX)
Current Dividend Yield: 2.30%
Country: USA

4.Company: Kansas City Southern (KSU)
Current Dividend Yield: 0.73%
Country: USA

5.Company: Kansas City Southern(KSU)
Current Dividend Yield: 2.08%
Country: USA

6.Company: Norfolk Southern Corp(NSC)
Current Dividend Yield: 2.42%
Country: USA

Another major railroad BNSF is private and is owned by Berkshire Hathaway Inc.

Disclosure: Long CSX, NSC and CNI