#$foxa

5 Trade ideas excerpted from the detailed analysis and plan for premium subscribers:

Estee Lauder, $EL, comes into the week holding at resistance. It has a RSI in the bullish zone and a MACD positive. Look for a push over resistance to participate…

Fox, $FOXA, comes into the week consolidating at all-time highs. It has a RSI in the bullish zone with the MACD positive. Look for continuation to participate…

MGM Resorts, $MGM, comes into the week approaching resistance. It has a RSI in the bullish zone with the MACD positive. Look for a push over resistance to participate…

NVIDIA, $NVDA, comes into the week breaking over resistance. It has a RSI in the bullish zone with the MACD crossing to positive. Look for continuation to participate…

Schneider National, $SNDR, comes into the week approaching resistance. It has a RSI in the bullish zone with the MACD positive. Look for a push over resistance to participate…

Up Next: Bonus Idea                                                                                        

If you like what you see sign up for more ideas and deeper analysis using this Get Premium link.   

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which with the shortened Christmas week in the books and just 3 trading days left in the year, saw equity markets show mixed strength with the SPY and QQQ rising while the IWM drifted lower.

Elsewhere, look for Gold to continue the uptrend at new all-time highs while Crude Oil holds at the bottom of consolidation on the verge of shifting to a downtrend. The US Dollar Index continues the short term drift to the downside in consolidation while US Treasuries continue in consolidation and looking better lower. The Shanghai Composite looks to continue the sideways motion in the uptrend while Emerging Markets march in place in their uptrend as well.

Weekly output: space tech, Fox earnings

Not going to Las Vegas for Black Hat deprived me of some conference receptions (excluding those that got canceled on account of the resurgent pandemic) and also reminded me of a failure mode specific to virtual events. As in, a speaker’s presentation stalled out on one slide, but he didn’t realize that because he apparently didn’t check the online chat and there was no IRL audience to say “next…

Snap, Inc. went public and sold stock to “investors” who were content, apparently, to be in possession of equity that didn’t have voting rights.

That’s right—Snap’s stock doesn’t vote. You probably heard that.

In a sense, this isn’t new. This tactic has been successfully used by media companies in the past… think Twenty-First Century Fox (NWS/A) and Viacom (VIA/B).

But the latest monkey business with voting rights doesn’t come from old-as-Methuselah media CEOs, but from Millennial tech CEOs.

Snap Took Voting Rights to a New Level

Alphabet (GOOG) has split its stock into voting and non-voting share classes, and Mark Zuckerberg owns super-voting shares of Facebook.

But Snap just issued stock that doesn’t vote. There is one vote, and it belongs to Evan Spiegel.

Evan Spiegel happens to be 26 years old, and he happens to be engaged to Victoria’s Secret model Miranda Kerr.

Knowing myself at age 26 (and knowing what I might have been like had I been engaged to Miranda Kerr), you can forgive me if I am implying that Spiegel might be a bit distracted.

None of these tech companies have a moat to begin with, and Snap’s is smaller than most. Instagram seems determined to put it out of business with its own “stories” feature, and it’s a known fact that Snapchat users just blaze through whatever ads they show anyway.

It also caters to the ficklest of fickle demographics, and any attempts to broaden Snapchat’s appeal have the potential to drive business to some other new, shiny platform. So there is that.

But there’s another issue.

If You Own Stock That Doesn’t Vote, Do You Really Own Stock?

I mean, pretend you own 10% of a company, but you have no say in how it is run. Do you really own it? Is it equity or debt? If you think about it, it’s kind of like a covenant-lite bond. A zero coupon, cov-lite perpetual.

Interestingly enough, some large institutional investors are lobbying the index providers (S&P and such) to keep SNAP out of the indexes, because the stock has no voting rights.

I agree with this for a lot of reasons. Stock that doesn’t vote is a bad development in capitalism, for sure, and there are obvious benefits to being in an index (with everyone piling into index funds these days).

So kicking SNAP out of the index for having non-voting shares will provide a strong disincentive to companies doing that in the future.

Never mind the fact that stock that doesn’t vote is not stock.

Evan Spiegel Should Be Held Accountable—But He’s Not

Snap is a company that is in pretty clear need of adult supervision, but CEO Evan Spiegel is accountable to no one. There are stakeholders—NBC Universal bought $500 million worth of stock, and Spiegel would be wise to listen to them, but if he doesn’t want to, he doesn’t have to.

I don’t think it’s a coincidence that everyone is crazy for non-voting stock with the S&P 500 at 2375. My guess is that if you dreamed up non-voting stock with the S&P at 666 (almost exactly eight years ago), you would have been laughed out of your own roadshow.

Sign of the times.

I’m doubtful of the investment merits, but my real beef here is about the voting rights. It takes a certain amount of arrogance to deny stockholders a say in the direction of the company.

That is one of the things about going public: you have to give up control, in return for being able to get liquid.

Evan Spiegel didn’t have to. Good for him, I guess.

Former Lehman Brothers Trader Reveals a Big Investment Opportunity in His Exclusive Special Report, The Return of Inflation

5 Trade ideas excerpted from the detailed analysis and plan for premium subscribers:

CME Group, Ticker: $CME

CME Group, $CME, started higher after the Brexit vote and ran until mid-September. It pulled back sharply from there to the current consolidation around 104. Friday saw a push up out of consolidation, but which stalled at the 20 day SMA. The RSI is moving back up through the mid line and the MACD is turning up towards a positive cross. These support continuation. Should it continue look to participate to the upside.....

Expedia, Ticker: $EXPE

Expedia, $EXPE, ran to the downside to start 2016, finding support in February. Since then it has moved up with a series of higher highs and higher lows, but making ground at a snail's pace. Friday saw a possible change to that as it moved up out of consolidation. The RSI is in the bullish zone and rising while the MAD is also moving up and bullish. Look for continuation to participate to the upside.....

Twenty-First Century Fox, Ticker: $FOXA

Twenty-First Century Fox, $FOXA, made a top at the end of April and started lower. It seems to have found support in mid-September about 25% lower, and has been rising since. Now it is back over the 50 day SMA for the first time since May. It also has a rising RSI up over the mid line and the MACD moving up. Look for a break over the short term resistance to participate to the upside.....

Helmerich & Payne, Ticker: $HP

Helmerich & Payne, $HP, ran hard to the upside off of a low in January. It reached a peak in July at 70 and then started a pullback. That found support at the 200 day SMA and started back higher at the end of September. Last week it reached the July high and consolidated. The RSI is bullish but pulling back from an overbought condition, while the MACD is level. Look for continuation to the upside through resistance to participate higher.....

Intercontinental Exchange, Ticker: $ICE

Intercontinental Exchange, $ICE, started higher in April. It pulled back through June with the financials making a low at the Brexit vote before reversing higher. That run made a new high before pulling back again at the end of September. The pullback found support at the 100 day SMA and Friday moved higher. The RSI also turned sharply to the upside and is now at the mid line. The MACD is about to cross up. Look for continuation to participate to the upside.....

After reviewing over 1,000 charts, I have found some good setups for the week. These were selected and should be viewed in the context of the broad Market Macro picture reviewed Friday which heading into October Options Expiration week the equity markets continue to show some weakness, especially in the small caps.

Elsewhere look for Gold consolidate with a downward bias if it resolves soon while Crude Oil continues to plow higher. The US Dollar Index also looks to continue higher while US Treasuries continue lower. The Shanghai Composite and Emerging Markets look best to continue to bide time moving sideways.

Volatility looks to remain low but creeping higher, sucking out the tailwind from the equity index ETF's SPY, IWM and QQQ. Their charts show clear weakness in the IWM, with the SPY and QQQ a little stronger short term. The QQQ is the best looking longer term. Use this information as you prepare for the coming week and trad'em well.

Yahoo Finance is tracking the stocks you’re following, based on your Yahoo Finance ticker searches.

Tesla (TSLA) – The electric car maker reported a bigger loss than expected while coming up short in revenue. Tesla posted a loss per share of $1.06 on revenue of $1.56 billion. The company also reaffirmed its previous guidance, saying it’s on track to deliver 50,000 vehicles in the latter half of this year.

Nike (NKE) – The company has announced it is getting rid of its golf equipment business as it struggled to boost sales and plans to focus on its golf footwear and apparel business to “accelerate innovation.” Golf was Nike’s worst performing division last year, raking in $706 million.

Square (SQ) – The digital payments company topped analysts’ estimates in the second quarter and raised its annual guidance. Square reported its gross payment volume rose to $12.5 billion, up 42% year over year and noted that it launched new products during the quarter to provide sellers with more options to accept payments.

Viacom (VIAB) – The company topped Wall Street estimates in the second quarter, posting adjusted earnings per share of $1.05 on revenue of $3.11 billion. Viacom reported an increase in ratings across some of its networks, including Nickelodeon, as well as 30% revenue growth in its filmed entertainment segment.

After a 4 year uptrend that saw Disney add over $100b in shareholder value, the stock seems to finally be hitting some real turbulence: 

Good news: A beloved brand owns a dominant franchise

One thing is certain -- Disney did very, very well with its debut as the owner of the Star Wars franchise.  $2.1 billion in global box office sales and counting, which propelled the company to its largest quarter in history -- over $15 billion in revenues and profits that topped analyst estimates.

In fact, you can see this dominance on display in social media, with Star Wars related mentions outpacing the rest of Disney brands and products by a mile:

Data from TD Ameritrade’s Social Signals tab

It’s worth noting that despite making up the biggest part of Disney’s enterprise value, theme parks run a distant fifth behind other entertainment options when it comes to what people are talking about online.

Bad News:  It’s all about ESPN now

We all know Mickey Mouse loves sports, but investors are getting a little tired of watching ESPN lose subscribers as more and more families are cutting the cord and canceling their Time Warner or Comcast cable subscription.

The post-earnings selloff that Disney is experiencing is almost purely driven by concerns over its ESPN unit, with investors noting that while Star Wars revenues are fantastic, they can only be counted on every 2-3 years when a new movie comes out.  

Others see light at the end of the ESPN tunnel with over-the top streaming and mobile distribution.  In fact, many like this tweet from Ross Gerber have taken to social media today to defend the company against what seems to be an exaggerated take on ESPN’s woes:

The best way to play Disney from here...

LikeFolio data on Disney brands has been slipping since last fall, especially when you “normalize” for the Star Wars release in December.  That gives us reason to believe that despite Disney’s incredible entertainment machine, there is only so much upside that Disney stock can achieve from here.

Fundamentals

##Symbol##DIS What once was a "boring" blue chip has now turned into a flexible, adapting, innovative, and content collecting machine. The bullish argument for Disney is that CEO Bob Iger, by collecting the Star Wars, Pixar and Marvel content into the Disney juggernaut has created a large pool of profits for several years to come. Bulls argue that that the once boring (and stuck) stock is poised for larger revenue, profits and a higher price. Further, the company has recently been saying that ESPN may bypass cable for streaming "eventually." Bob Iger said, "I think eventually ESPN becomes a business that is sold directly to the consumers." I remind all readers that a report just like this one is available for any company for free on CMLviz.com. No e-mail. No login. Free. Forever. Period. A live streaming service for sports events is a beautiful idea, beautiful capitalization on an already powerful asset and yet another creative way Disney has moved from old school to new school and mitigated risk of cable cord cutters. Further, now that Disney owns George Lucas' company, (in 2012) it has loads of money to make in the upcoming Star Wars movies. Morgan Stanley's Benjamin Swinburne forecasts that the new Star Wars film could add $2 billion in retail consumer merchandise sales to the franchise's nearly $3 billion in annual sales. That would net Disney an incremental $200 million in license fees. Disney should also clear about $100 million in video game revenue in 2016, Swinburne estimates (Source: TheStreet.com). From an execution point of view, Disney has seen revenue (TTM) and net income (TTM) rise to all-time highs for more than five consecutive quarters. The company got the cover story in the May 30th publication of Barron's where author Jack Hough notes that the firm "is a wizard at wringing profits from its theme parks and cruises, hit films and merchandise sales." So the company is going to rip on earnings, right? Well, this good news hasn't gone unnoticed by the equity market and the stock has risen nearly 36% in the last year. If we plot price to sales at each quarter end for the last 15 years, we do see that Disney now has a valuation component to worry about. Click Here to Chart Anything for Any Company For the record, Disney's current price to sales is actually at 3.96, so it's off the chart (literally).

Technicals   |   Support: 117.85   |   Resistance: 119.58   

Golden Cross Alert: The 50-day MA is now above the 200-day MA. Swing Golden Cross Alert: The short-term 10 day MA is now above the 50 day MA. DIS has a four bull (high rated) technical rating because it's trading above both its 50- and 200-day moving averages. We do note that the stock is trading below the short-term 10-day moving average. Here are the consensus estimates for next quarter. Note that last quarter's actual result is included at the far right.

EARNINGS ESTIMATES Earnings Date EPS Revenue (Mean) Revenue (Median) Last Quarter (Actual) 2015-08-04 $1.39 $13.6 billion $13.7 billion $12.5 billion M Provided by ZACKS

Here is a summary of the core fundamentals that drive the four star fundamental rating.

Fundamentals Rating Summary

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Revenue (TTM US$ Millions) 50,707 47,104 43,765 Operating Margin (QTR) 1.332 1.34 1.26 FALLING Net Income (TTM US$ Millions) 8,034 6,998 5,970 Levered Free Cash Flow (TTM US$ Millions) 5,635 6,968 5,698 FALLING Capital Expenditures (TTM US$ Millions) 3,857 3,036 2,792

Stock Returns and Chart

DIS is up +3.6% over the last three months and up +23.4% over the last six months. The stock price is up +33.6% over the last year and more than 70% over the last two-years. Before we dig into the fundamental trends that drive the rating, let's look at a two-year stock chart with regression channel and 10-day momentum (on the bottom). The name for this trend is very technical, it's called ,"stock goes up." Click here to interact with this stock chart Now let's examine the visualizations of the critical financial measures.

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Revenue (TTM US$ Millions) 50,70747,10443,765

Aside from the stock price, revenue (TTM) is probably the most breathtaking trend. Revenue on an annual basis has risen 13 consecutive quarters to all-time highs for each quarter (five consecutive quarters triggers a trend which drives the fundamental rating higher.) Revenue over the trailing twelve months (TTM) for DIS is up 8% from a year ago and 16% over two-years. With the Star Wars franchise in its back pocket, a potentially innovative approach to monetizing its powerhouse ESPN (innovative for Disney) and the wonderful expansion of the international box office, there is room for this company to grow. What do all these numbers mean? DIS's fundamental rating benefited these results: 1. The one-year change was positive (but no extra points were given for a large percentage increase). 2. The two-year change was positive. Finally, the up trend (consecutive quarters) in revenue benefited the fundamental (star) rating. Let's look at Revenue (TTM US$ Millions) in the chart below. Click Here to Interact With This Chart

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Operating Revenues/Operating Expense 1.3321.341.26FALLING

Operating revenue over operating expense simply shows us how much revenue (in dollars) is generated for every dollar of expense. The ratio must be (at a minimum) above 1.0 in order for a company to turn an operating profit. For the latest quarter Disney showed a ratio of 1.33. While the number is down from a year ago, it's actually up from two-years ago. While these numbers seem small, they are not. A giant like Disney (DIS) raising its operating margin over a few years this much is quite an accomplishment. The franchising business is also a very high margin business. What do all these numbers mean? A year ago Operating Revenues/Operating Expense was 1.34. In the last year we can see operating margins are decreasing but are greater than 1.0 for the most recent period. DIS's fundamental rating was affected from the operating margin numbers in two ways: 1. The current value is above 1.0 (the firm generates an operating profit). 2. The one-year change was negative (lowers the rating a little bit). Let's look at Operating Revenues/Operating Expense in the chart below with the total assets in the orange line. Click Here to Interact With This Chart

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Net Income (TTM US$ Millions) 8,0346,9985,970

With the rising revenue and generally (longer-term) rising operating margin, earnings are following. In fact, Disney has broken its own all-time highs in earnings for seven consecutive quarters to a most recent trailing-twelve-month level of over $8 billion. That's an increase in the most recent year of 14.8%. Those seven consecutive quarters also qualify as a "trend" and trigger a higher fundamental rating. In our next chart we plot Net Income (TTM US$ Millions) in the blue bars and the quarterly results in the gold line. Note the rising bars from a year ago (four quarters ago). Click Here to Interact With This Chart

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Levered Free Cash Flow (TTM US$ Millions) 5,6356,9685,698FALLING

So with all this good stuff, the question can be asked, "why is this not a five star rating?" That's a fair question, and here's the fair answer. Levered Free Cash Flow (TTM US$ Millions) (which is a critical determinant of stock price since market cap is the present value of all future free cash flows) for DIS is falling down 19% year-over-year. For our next chart we plot Levered Free Cash Flow (TTM US$ Millions) in the blue bars through time. Click Here to Interact With This Chart

METRIC CURRENT 1YR AGO 2YR AGO DIRECTION Capital Expenditures (TTM US$ Millions) 3,8573,0362,792

Based on the television ratings I may have jumped the gun on the whole “Jordan Spieth: Golf Savior” movement I wrote about yesterday. 

Despite having a prime time dual between two of the most telegenic players in the game Sunday was the second lowest rated US Open finale in history. This is lousy news for golf fans. In terms of drama Sunday was about as good a show as golf can offer and America still tuned out in droves.

The Fox machine points out the 45% improvement over last year but they know better than to push the angle too far. This year’s Open was played on the west coast. That meant most of the final round was shown in primetime when the potential audience is 40 to 50% larger than daytime hours. 45% better than last year was arguably as poorly as Fox could have done given the timing tailwind alone.

Considering the ‘14 was Open was up against the NBA finals the and devoid of anything close to a compelling storyline the ratings should have doubled. Watching Martin Kaymer coast to an 8 stroke win and bust out this over-the-top traditional Germanic celebration is a tough sell in any economy:

In 2015 the leaders didn’t tee off until 6pm. The golfers may not have liked the course but as a TV setting Sunday night was transcendent. As bedtime came and went in New York the shadows got long in Washington, casting the screen in the elusive Magic Hour lighting nature seems to withhold for moments of Great Meaning. 

When relative unknown Brandon Grace sent his tee shot on 16 out of bounds only two men stood in the Thunder-dome. Jordan Spieth, the future of golf versus Dustin Johnson, a big-hitting bad-boy and rehab alum. It was 9:30pm in the east. After 6yrs in the post-Tiger wilderness golf had two of its biggest future stars playing for the highest possible stakes in the heart of primetime.

With Spieth in the clubhouse with a one stroke lead Johnson hit a glorious 6-iron to reach the green on the par 5 18th in two strokes. He had 12-feet to win the U.S. Open in front of his fiancee and new baby. 

Oh yeah, them. The most surprising thing about the coverage was Fox’ unwillingness to address anything related the golfers’ personal lives. It was a strange call; not because Fox is more tabloid-ish than other networks but because Johnson’s story is all about emotion. He’s blown leads at the US Open before, which always leaves a scar. He looks like a movie star from the 1950s; dark, handsome, shaped like a martini glass. 

In fact, everyone around Johnson is camera ready. Look at that screen shot again. Nothing but gorgeous, famous people 100% convinced they’re about to watch DJ take a putter to the head of the monkey that’s been riding his back for years. The person on the far left is the actress Janet Jones from such classic movies as Police Squad 5 and American Anthem with Mitch Gaylord.

Also pictured is Wayne Gretzky, the greatest hockey player in history and Johnson’s future father-in-law. Johnson has four or five different inspiring narratives but Fox didn’t share them. Casual viewers literally had no way to know what they were missing.

And there was a lot to miss, some of which would seem irresistible to Fox. Like Paulina Gretzky’s brave stance in favor being as naked as possible on social media. That doesn’t make her a bad person in the least but it does put the personal narrative in fair play and create ample b-roll.

There’s a television executive somewhere who didn’t think America cared about this kind of stuff. That executive should be doing something else for a living. 

The mistake isn’t in trying to take a journalistic high-road but failing to tell any story at all. Viewers don’t care whether or not a putt falls unless they know about the guy hitting it. Johnson was lugging steamer crates full of baggage with him on that 18th green. He’d teed off with the lead on Sunday at the 2010 US Open and shot an 82. He had a chance to win the PGA but was penalized 2 strokes for failing to obey an arcane local rule and missed a playoff.

A man stood over a 4′ putt to win the US Open. Greg Norman, fairly or unfairly considered one of the worst chokers in golf history, mentioned something about it being an “easy” shot. Norman knows much better than that but no one challenged the statement. 

Moments later Joe Buck “It’s a three putt!” which, while true, didn’t quite do justice to the moment.

Dustin Johnson’s face filled the screen. His expression was as inscrutable as Don Draper sitting on a mountain side. Also like the end of Mad Men, the shot meant nothing to anyone who wasn’t already a hardcore fan. That’s fine for AMC but it isn’t really what the USGA is looking for in terms of promoting its sport.

Fox could have shown a stream of Paulina Gretzky’s Instagram account and gotten 7 million viewers. Instead the network chose to all but ignore the emotional side of Johnson’s crushing three putt. Amazingly, Fox didn’t even have a camera on Spieth to capture the moment Johnson missed his second putt on 18.

The bottom line is Fox paid $100m to broadcast a golf tournament and didn't bother to show the winner or put the loss is any context. Because who the hell knows why not. Without a Johnson backstory or Spieth reaction DJ may as well been mopping up at a Hooters Pro-Am as far as ½ the audience was concerned. Suffice it to say a lot of people are questioning the coverage on storytelling grounds. 

Will Golf Die of Natural Causes or get murdered by Fox?

I actually liked the tournament overall but numbers don’t lie. Fox is paying about $1.2 billion to broadcast the next 12 US Open tournaments. Last Sunday night more people watched Celebrity Family Feud in some markets. Really. 

I’m not sure how much it cost to produce an episode of Celebrity Family Feud but my educated guess is that it’s lower than $100 million. That makes last Sunday a borderline disaster for Fox. The company can afford a few misses but this golf experiment is a large stage on which to screw up.

It’s not like golf has been doing fabulous without Fox. I’ve done a couple different stories with the lovely and talented Ashley Mayo of Golf Digest talking about ways to save the game. We even played a round together (NB: In broadcasting terms “a round” is about 3 holes in 4 hours).

Golf courses are closing around the country. Television ratings are in a price discovery state, adjusting to life without Tiger. Spieth’s triumphal win at the Masters last April resulted in a decent bump in viewership but the trend is still disturbing.

Maybe it was Fox fault or perhaps golf is just dying. Either way golf missed a huge opportunity to matter again, if only for an evening. The action deserved a better stage.