Investment Club October 14th, 2016

Investment Club October 14th, 2016

Agenda 1)Market Update 2)Qualcomm (QCOM) 3)Checkpoint (CHKP) Presentation 4)Interview Question 5)Barclays Announcement 6)Upcoming Events

Market Update Week of Oct 10th Anna Evinski Dave Perron

The Dow: -The Dow industrials declined 45 points, or 0.3%, to 18099 on Thursday - S&P 500’s materials sector fell 0.5%, while the energy sector declined 0.7%. The S&P 500 dropped 0.3%, and the Nasdaq Composite lost 0.5%. -Havens gained Thursday, with utilities in the S&P 500 up 1.3%. Gold rose 0.3% to 1,255.00 an ounce, while the yield on the 10-year U.S. Treasury note fell to 1.739% from 1.778% on Wednesday.

Overview: Minutes from Fed show a rate increase is coming soon Alcoa kicked off earnings season with disappointing quarterly results, just a day after its stock fell 11% Putin says he would support a production cap on oil (crude gained early in the week)

Technology Samsung Electronics Co. cut its preliminary third-quarter earnings guidance figures on Wednesday, a day after announcing that it would permanently discontinue its troubled Galaxy Note 7 smartphone Lowered its operating profit to 5.2 trillion ( 4.6B) won from original 7.8 trillion won A lot of this loss is contributed to the Galaxy Note 7’s discontinuation

Wells Fargo CEO Resigns John Stumpf, 63, resigns October 12th Scandal over bank secretly selling services to unaware customers to meet sales targets Bank agreed to pay 185 million Settle charges it opened on as many as 2 million accounts without customer knowing or approving

Wells Fargo CEO Resigns continued. Bank requiring Stumpf to forfeit 41 million in unvested equity Tim Sloan, 56, company’s president and chief operating officer, will succeed Stumpf Reputation of Wells Fargo damaged Stock price fell 12 percent Now JPMorgan Chase & Co. takes top spot for market value among U.S. banks

Wells Fargo CEO Resigns continued. Wells Fargo shares climbed 1.5 percent to 46 in extended trading at 5:11 p.m. in New York, after the bank announced Stumpf’s exit. The stock had slumped 17 percent this year through the close of regular trading, the worst performance in the 24-company KBW Bank Index.

The British Pound at Weakest Level in History Pound touched historic low against a basket of global currencies Pound recently traded at 31-year low against the dollar and six year low against the euro Worth less than in height of 2008-2009 financial crisis Analysts believe there are further declines to come against global currencies HSBC Holdings PLC forecasts sterling will hit 1.20 by the end of

The British Pound at Weakest Level History The fall in is feeding into the British economy, which is both good and bad U.K. import prices for business rise 9.3% year over year in August The significant weakening of the pound can actually be positive, making British exports more competitive overseas

Milk! “More than 43 million gallons’ worth of milk were dumped in fields, manure lagoons or animal feed, or have been lost on truck routes or discarded at plants in the first eight months of 2016, according to data from the U.S. Department of Agriculture” This is happening amidst a massive glut of milk Producers are trying to find use for the excess milk in lunches and ‘revamped tacos’

NASDAQ: CHKP

Valuation Multiples

Cybersecurity Sub-Sector The recent trend has been that cyber attacks are increasing at an alarming rate across companies and governments Every time an attack happens, cybersecurity stocks rise Cybercrime will cost the global economy 445 billion in 2016 According to a Markets and Markets report, worldwide cyber security spending will reach 101 billion in 2018 and 170 billion by 2020 Existing clients tend to stick with their respected cyber security company despite the fact that their services may not be prepared for another attack

Upside Largest pure play security vendor 46% of revenue is “sticky” due to increasing cyber security threats Remainder is subscriptions, products, and licenses Continued revenue growth

Downside Susceptible to global economic slowdown Tech industry is constantly changing Some analysts believe CHKP has lost its drive due to its slowed R&D growth

INTERVIEW QUESTION

BARCLAYS INTERNSHIP -Sales and Trading -Investment Banking

NEXT WEEK: SUPER DAY Conference Call