Anyone trying to keep track of where the markets might be heading, could be forgiven for displaying signs of dizziness. The markets are being violently pulled in opposite directions lately, making it difficult to form a coherent investing strategy. It is in time like this that some expert advice might provide a clearer picture. Hardly any on the Street come more highly regarded than billionaire David Tepper. The co-founder of global hedge fund Appaloosa Management, Tepper is known for his brash and confident style, traits which could come in handy in today’s confused climate. Tepper made his fortune – and built his hedge fund – by investing in distressed assets and profiting mightily when markets reversed later on. And with $14 billion worth of assets under Appaloosa’s management, it’s natural for Wall Street to take notice when Tepper has something to say. “Basically, I think rates have temporarily made the most of the move and should be more stable in the next few months, which makes it safer to be in stocks for now,” Tepper noted. The billionaire believes the rising rates should settle and points out that with the Senate’s approval of the coronavirus fiscal stimulus package, it is currently “very difficult to be bearish.” With this in mind, we’ve opened up the TipRanks database to get the scoop on two of Tepper’s recent new positions. These are Strong Buy stocks – and perhaps more interestingly, both are strong dividend payers, with annual yields exceeding 7%. We can turn to the Wall Street analysts to find out what else might have brought these stocks to Tepper’s attention. MPLX LP (MPLX) We’ll start with a long-established name in the energy sector. Marathon Petroleum, one of the giants of Big Oil, operates across the US, in the Rocky Mountains, the Midwest, and along the Gulf Coast, moving oil and natural gas products from the wells to the storage and distribution facilities. MPLX has benefited from the general economic reopening in the second half of 2020, with the stock gaining as more people returned to work and demand for fuel increased. Overall, shares are up 98% in the last 12 months. At the top line, revenues have rebounded from a dip in 2Q20, gaining 8.5% to reach $2.17 billion by Q4. Earnings, which turned sharply negative in 1Q20, rose steadily through the rest of the year, and came in at 64 cents per share in Q4. But perhaps the most important metric, for investors, was MPLX’s net cash position – for the full year 2020, the company generated $4.5 billion in cash, and returned over $3 billion of that to shareholders. In its most recent dividend declaration, the company announced a 68.75 cent payment per common share, or $2.75 annualized. This gives a yield of 10.5%, far above the average yield. And David Tepper, in the last quarter, bought heavily into MPLX, picking up more than 3.45 million shares of the stock. At current prices, these shares are now worth $89.77 million. As noted, this is a new position for Tepper, and it is a substantial one. Covering this stock for RBC Capital, 5-star analyst TJ Schultz believes the company’s strong balance sheet justifies a positive sentiment. “[We] think MPLX is well positioned to continue steady cash flow and distributions into 2021+. Management reinforced MPC’s commitment to MPLX contract renewals. Some modest price slippage on near-term barge renewables, but the chunkier contracts were either set more recently (longer runway) or are already tied to FERC oil dynamics. We like MPLX’s improving FCF profile and solid balance sheet, which we think gives management more options for returning value through unit buybacks over the next year,” Schultz wrote. To this end, Schultz gives MPLX a $29 price target, implying a 12% upside, to go along with his Outperform (i.e. Buy) rating. (To watch Schultz’s track record, click here) MPLX’s strong share appreciation has pushed the stock price close to the average price target. Shares are selling for $25.92 now, with an average target of $27.67 suggesting room for ~7% further growth. The stock holds a Strong Buy consensus rating, based on 5 Buys and 1 Hold given over the past 3 months. (See MPLX stock analysis on TipRanks) Enterprise Products Partners (EPD) Sticking with the energy sector, we’ll look at another midstream company that caught Tepper’s attention. Enterprise Products Partners, with a $50 billion market cap, is a major player in the midstream segment, and operates a network of assets including more than 50,000 pipeline miles, storage facilities for 160 million barrels of oil and 14 billion cubic feet of natural gas, and shipping terminals on the Gulf Coast in Texas. The story here is similar to that for MPLX. Enterprise was hurt by the lockdowns put in place to combat the COVID pandemic, but in the last six months has seen a rebound in share value and revenues. Shares are up 40% in that time, while revenues in Q4 broke back above $7 billion. Overall, Enterprise’s 2020 performance showed declines from 2019 – but one important metric showed a gain. Of the company’s total cash flow, $5.9 billion, $2.7 billion was free cash flow (FCF), or cash available for distribution. This was up 8% year-over-year, and allowed the company to keep up its regular dividend payment – and even to raise the payment in the most recent declaration, from 44 cents per common share to 45 cents. With a $1.80 annualized payout per share, this gives a robust yield of 7.7%. Tepper’s new position in EPD is substantial. The hedge fund leader bought up 1.09 million shares of the stock for his first position, a buy that is now worth $25.23 million. Analyst Matt O’Brien, of JPMorgan, sides with the bulls, reiterating a Buy rating and $28 price target. This target conveys his confidence in EPD’s ability to climb 20% from current levels. (To watch O’Brien’s track record, click here) “With capex needs slowing, EPD expects to reach positive discretionary free cash flow in 2H21, enabling fully funding capex, growing cash distributions, and opportunistic buybacks… Overall, we continue to believe EPD offers the optimal mix of offense and defense, with attractive embedded operating leverage, notable barriers to entry, low leverage, and best-in-class financial flexibility,” O’Brien commented. Wall Street’s analysts can be a contentious lot – but when they agree on a stock, it’s a positive sign for investors to take note. That’s the case here, as all of the recent reviews on EPD are Buys, making the consensus rating a unanimous Strong Buy. The analysts have given an average price target of $27, which indicates ~15% upside from the current share price of $23.38. (See EPD stock analysis on TipRanks) To find good ideas for dividend stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Facebook-Meta Earns the ‘Worst Company of 2021’ Title in This Survey
Facebook parent Meta has been named the Worst Company of the Year (2021) by Yahoo Finance respondents. According to the publication, an “open-ended” survey was published on Yahoo Finance on December 4 and 5, where 1,541 respondents participated. Facebook received 8 percent of the write-in vote, but respondents were seemingly mad about the Robinhood trading app as well. Electric truck startup Nikola, which was named last year’s worst company by the same publication also faced respondents ire.
Yahoo Finance even highlights, “At the same time, some critics, including conservatives, say Facebook over-policed the platform’s speech and stifled their voices.” Critics also blame Facebook and other social media platforms for not curbing hate speech that led to Capitol Building riots.
However, around 30 percent of Yahoo Finance readers said that Facebook or Meta could redeem itself. One respondent suggested that the company could issue a formal apology for negligence and donate a sizable amount of its profits to a foundation to help reverse its harm.
On the other hand, respondents chose Microsoft as the Company of the Year (2021). The Satya Nadella-led company touched the trillion-mark this year and introduced notable upgrades. The most notable is the Windows 11 OS update that succeeds Windows 10.
Facebook pays 1.7 Cr fine to Russia after failing to delete content Moscow deems illegal
In the latest legal tussle with Russia over controversial social media regulation laws, Facebook paid 17 million roubles (Rs 1.7 Crore) for failing to remove content deemed illegal by Moscow. With a threat of potential larger fines looming, Facebook parent company Meta, owned by Mark Zuckerberg, is scheduled to face court next week over repeated violations of Russian legislation on content, Interfax News Agency reported. As per the latest updates, the social media giant could be fined a percentage of its annual revenue.
In October, Moscow sent state bailiffs to enforce the collection of 17 million roubles. Meanwhile, as per Interfax report citing a federal bailiffs’ database, on Sunday, there were more enforcement proceedings against the company. Apart from the popular social media app, Telegram has also paid 15 million roubles in fines for failing to comply with the Russian social media legislations that came into force in 2016.
Facebook pays $53k to Russia for refusing controversial social media laws
It is pertinent to mention that Facebook has locked horns with Moscow earlier in November, resulting in it paying 4 million roubles ($53,000) over its refusal to adhere to Russian data localisation laws, the Moscow Times reported. The Moscow court on November 25 had said that Facebook paid the fine levied in February, following which all proceedings against the US-based social media giant. The payment comes against the litigation filed against the company in 2018, alongside Twitter. The tech companies were also forced to pay an additional 3000 rubles ($40) for failing to comply with user data sharing rules as per the law. The Russian authorities have also previously blocked LinkedIn, owned by Microsoft, for failing to abide by the laws.
Russian social media laws
As per Moscow Times, under the Russian social media regulation laws, all foreign technology companies are required to store data related to Russian customers and users on servers located in Russia. Additionally, the Russian tech companies will also have to share encryption data with the federal authorities as well as record user calls, messages and civil society group conversation records. The apparatus is said to be a severe breach of privacy rights and unfettered back-door access to personal data that could be used to harass Kremlin critics.
Facebook Messenger Is Launching a Split Payments Feature for Users to Quickly Share Expenses
Meta has announced the arrival of a new Split Payments feature in Facebook Messenger. This feature, as the name suggests, will let you calculate and split expenses with others right from Facebook Messenger. This feature essentially looks to bring an easier method to share the cost of bills and expenses — for example, splitting a dinner bill with friends. Using this new Split Payment feature, Facebook Messenger users will be able to split bills evenly or modify the contribution for each individual, including their own.
The company took to its blog post to announce the new Split Payment feature in Facebook Messenger. 9to5Mac reports that this new bill splitting feature is still in beta and will be exclusive to US users at first. The rollout will begin early next week. As mentioned, it will help users share the cost of bills, expenses, and payments. This feature is especially useful for those who share an apartment and need to split the monthly rent and other expenses with their mates. It could also come handy at a group dinner with many people.
With Split Payments, users can add the number of people the expense needs to be divided with and, by default, the amount entered will be divided in equal parts. A user can also modify each person’s contribution including their own. To use Split Payments, click the Get Started button in a group chat or the Payments Hub in Messenger. Users can modify the contribution in the Split Payments option and send a notification to all the users who need to make payments. After entering a personalised message and confirming your Facebook Pay details, the request will be sent and viewable in the group chat thread.
Once someone has made the payment, you can mark their transaction as ‘completed’. The Split Payment feature will automatically take into account your share as well and calculate the amount owed accordingly.
Tasneem Akolawala is a Senior Reporter for Gadgets 360. Her reporting expertise encompasses smartphones, wearables, apps, social media, and the overall tech industry. She reports out of Mumbai, and also writes about the ups and downs in the Indian telecom sector. Tasneem can be reached on Twitter at @MuteRiot, and leads, tips, and releases can be sent to firstname.lastname@example.org.