Black Rock Financial - The Premier Financial Services Company

Analysis of Stock

Black Rock Financial company

Black Rock is one of the leading asset management firms in the world. The company was founded in 1988 and based in New York. It was formed mainly for the purpose of managing risks and fixed assets. As of July 2017, BlackRock is the leading asset manager in control of over $5.7 trillion. The organization specializes in investing on behalf of individual investors, retailors and institutions. Clients acquiring services of the firm include mutual funds, pension plans, government, insurance companies, endowments and charities. Some of the products it also manages include close-ended and open-end mutual funds, unit trust, mutual funds and other structured funds. BlackRock also offers risk management solutions and is highly competitive in exchange-traded funds (EFTs) through using iShares.

The organization benchmarks its portfolio’s performance against the indices o0f companies such as MSCI, Merrill lynch, Citi group and Russel. The other main competitors of the company are Legg Mason Inc., State street corporation and UBS AG. The company has a Beta of. 1.71. An interpretation of this means that the stock of BlackRock is more volatile than that of the general market. The market usually has a constant beta of 1 ( Granger, & Morgenstern 1963) . Moreover, this means that when the market is moving upwards, the stock of the company will rise higher as compared to that of the market. Consequently, when there is a drop in the market, the stock of the firm will decrease more in comparison with the market.

Wheeler Real Estate Investment Trust

Wheeler Real Estate Investment Trust Inc., is an estate management firm formed primarily with the objective of securing, financing, leasing and managing assets which continuously generates income. These properties include; community centers and grocery-anchored centers. The portfolio of Wheelers investments is suitably located and has potential dominant retail stores both in the primary and secondary markets which are leased by the national and regional retailers of consumer goods. Most of the properties managed by the organization have attractive risk-adjusted returns.

The company focuses on creating more groceries shopping centers to achieve redevelopment thought the United States. Some of the major rival firms to Wheelers are the AGNC Investment Corporation, Alexanders Inc., American Assets Trust, Boston Properties and the Capital Trust. In conducting an analysis of the stock of the company, it has a beta of 1.19 (Lau et al., 2002). This means that Wheelers stock is slightly more volatile than of the overall market. The market usually has a beta of 1. Therefore, the riskiness of the firm’s stock is more than that of the market. When the market moves upwards, the stock of the company will increase more than that of the market, while when the market goes down, the wheeler’s stock will decrease more than the market.

American Telegraph and Telephone Company

The American Telephone and Telegraph Company is a provider of voice, data, internet communications and other professional related services to businesses, individuals and various government agencies. The company was founded in March 1885, having its headquarters based in Texas. For a long period, the firm has operated as a monopoly being the largest telephone and cable television operator. The organization has undergone various mergers and acquisitions and change of ownership. The AT & T Company operates four major segments which are the business solutions provider, entertainment, international and consumer mobility. It is an international corporation since it offers its services across various countries such as America, Latin and Mexico. As of February 2017, the company was rated to be the 12 ^th largest organization in the world through a measure of its revenues and assets and a market valuation. It was also ranked to be the 18 ^th biggest mobile operator in the world having over 134 million mobile network customers.

The firm is a holder of three global sport TV network, game related programming and other internet interactive games. Its subsidiaries are the AT & T, Mobility, SKY Brasil. The American Telegraph and Telephone Company has stock with a beta of 0.49. This means that the stock of the company is less volatile when compared to that of the overall market, being than it is less than 1. An interpretation to the riskiness of this beta is that when there is an upward movement in the market, the stock of the company will rise higher in comparison with that of the market. Also, when there is a downward movement in the market, the stock of the firm will decrease more than that of the general market (Hochhaus, 1972 ).

Pattern Energy Group

Pattern energy group is one of the independent power generating companies that is publicly listed under the NASDAQ global select market as well as the Toronto stock exchange platform. The organization holds a portfolio of more than 20 renewable energy facilities which are able to generate a stable source of long term cash flows in a vast market which has a high growth potential. The firm has been able to successfully manage over $12 billion worth of assets which includes more than a 4,500MW wind power projects. The organization is driven by an entrepreneurial spirit to ensure it as a continuous and sustainable growth. In its long term objectives, the company aims at creating a long term value for its shareholders to ensure that it continuously grows its portfolios and maintain a steady flow of cash from their investments.

Some of the other highly competitive firms in the energy industry includes the American Power company, Atlantic Power Corporation, Dominion energy Inc., and the DTE Energy company. On measuring the volatility of the stock, the company has a beta of 0.61. Its riskiness is less than 1 (Beta of the market). When hence using the broader market as a benchmark, this means that Pattern energy has stock which has a lower volatility as compared to that of the market. Additionally, this means that the stock of the company is less risky and expected to increase less than that of the market in times when the market is moving upwards, and on the other hand, when the market is moving down, it is anticipated that is will fall less than te market.

The Boeing Company

Boeing Company is a multinational aerospace company that manufactures and sells airplanes, rockets and satellites globally. It also manufactures space and security systems, weapons, military crafts, launch systems and other advanced information and communications systems. The company has clients in over 150 countries. Its services and products are well tailored to meet specific customer needs. It is committed to being a leader in the commercial aviation by offering products which have a superior design and highly valued by customers widely. The organization faces great competition in the jet making industry. Some of its competitors who also have a strong control of the market share includes Airbus, Embraer and Bombardier. However due to high capital investment requirements, there are few entrants into the market. The new entrants include COMAC of China, Mitsubishi Aircraft of Japan and the IrKut- United Aircraft Corporation of Russia ( Rodgers,1996). Boeing however continues to curb competition through focusing more on value creation by improving its processes and cutting on its costs.

Boeing’s beta measures the volatility of the its stock to that of the broader market. With the market as the benchmark, its beta is always 1. With a betta of 1.47, it therefore means that the stock of the company is anticipated that it will increase more than that of the market in its up markets and in the down markets, it will decrease more than that of the market. The beta also shows that the stock has a higher volatility as compared to the volatility of the market.

The riskiness of the company’s stock is determined by covariance of the stack return and the market return by the market’s variance (Hochhaus, 1972 ).

Beta = covariance (ri.rm)/variance (rm)

In determining the covariance of a stock, the historical prices of the security are evaluated to determine the stock movement. A positive covariance is used when the when two stocks move in the same direction while a negative one shows opposite direction of stock movement.

References

Exchange, L. S. (2014). London stock exchange.

Granger, C. W., & Morgenstern, O. (1963). Spectral analysis of New York stock market prices. Kyklos , 16 (1), 1-27.

Hochhaus, L. (1972). A table for the calculation of d'and BETA. Psychological Bulletin , 77 (5), 375.

Lau, S. T., Lee, C. T., & McInish, T. H. (2002). Stock returns and beta, firms size, E/P, CF/P, book-to-market, and sales growth: evidence from Singapore and Malaysia. Journal of multinational financial management , 12 (3), 207-222.

Musmanno, T. E., Leftly, S. C., Fong, R., & Kane, P. K. (1999). U.S. Patent No. 5,940,809 . Washington, DC: U.S. Patent and Trademark Office.

Rodgers, E. (1996). Flying high: The story of Boeing and the rise of the jetliner industry . Atlantic Monthly Press.