Cornell Equity Research Publication Spring 2021

Cornell Equity Research Sector Report | Spring 2021 | Energy

Energy Sector Report Industry Trends The energy sector is broken up into two main sectors: oil and gas and renewables. Oil and gas have traditionally powered the global energy grid but are relatively inefficient and have had negative effects on the environment. Renewable forms of energy such as solar, wind, and hydro based forms of energy are more efficient; however, they face logistical obstacles such as incompatibility to the power grids that are currently in place and the need for these renewable forms of energy to be built.

In the midst of the global recession ushered in by the COVID-19 pandemic, the demand for energy dampened as a result of decreased consumer and producer demand. Oil and gas, the sources of energy used for production and transportation of consumer goods, was hit especially hard as a result of the pandemic. For example, the price of the Western Texas Intermediate (WTI) oil futures contract went negative in the midst of the pandemic because production levels exceeded demand levels and storage facilities could not accept more oil. As mentioned in previous CER Energy Sector Analyses, the pandemic was an ideal time for successful oil and gas companies to utilize the decrease in energy demand to shift their overall strategies more towards renewable forms of energy.

In addition to the pandemic, inconsistencies in winter weather have led to volatile energy prices.

Variable energy prices make it difficult to determine how oil and gas companies perform, because if companies maintain constant production but energy prices are falling, they will lose revenues.

This can be seen in the price of the Henry Hub futures contract, which is meant to determine the actual price of natural gas.

Industry Outlook Historically, the energy sector has outperformed the S&P500 regardless of economic recession.

Using the Vanguard Energy ETF (VDE) as for comparison, since 2005 VDE is up 126% compared to the S&P500 being up 86%. While the price of oil has decreased nearly 65% at this time, the energy sector has consistently trended upwards. This difference between an index that represents the whole energy sector, and a specific faction of the energy sector shows how the sector is adapting.

As a result of the pandemic, domestic production, travel, and consumption fell, decreasing the need for oil and LNG. During 2020, the S&P500, which is largely a representation of the entire economy, outperformed the VDE by nearly 5.5%. A lackluster year of growth for the energy sector is a result of the decreased energy demand, and the shifting of many large energy companies to renewable sources. As the global economy returns to normalcy, the oil and LNG sectors of the global economy are expected to recover; however, these facets of the energy industry will not last.

The energy industry will continue to grow due to gains in the renewable sectors.

Cornell Eq i

Re earch Repor

04/15/2021 Ne Era Energ (NEE) Anal

Ra ing : S

C

a

C rren Price: [$80.18]

U

a

N

C rren Marke Cap: 152,875 mm Re en e: $17,997 mm EBITDA: $9,461 mm P/E Ra io: 52.49 52 k high: $87.69 52 k lo : $55.65 Di idend Yield: 1.54% In a 3/19/21 ne relea e, a projec ion of earning -per- hare gro h a foreca ed in he 6-8% gro h range hro gho 2022 and 2023 ($2.55-75 and $2.77-97)

C

Sa

c

from Q4 2020

D ke Energ Corpora ion (DUK) Energ Prod c ion: 51,000 m S ock Price: $99.75 Re en e: $5.78 billion

The So hern Compan (SO) Energ Prod c ion: 42,000 m S ock Price: $64.49 Re en e: $5.1 billion

E aE

: Ror Sheppard

One- ear Targe Price: $76.65

(NEE)

O er he pa o decade , Ne Era Energ ha recorded remarkable gro h bo h in heir earning per hare and profi abili . Since hen, Ne Era ha gro n from hir ie h in U ili ie b marke capi ali a ion o fir .

A of April 15 h, 2021, Ne Era Energ (NEE) i rading a $80.18. I belie e ha hi eq i i o er al ed and e pec ed o decrea e o $76.65 i hin hi ear. I arri ed a hi concl ion b cond c ing a comparable companie anal i i h a 7.1% gro h, 9% opera ing margin, and he ma im m EV/Re en e m l iple of 9.9 . I ed he e a mp ion ba ed on hi orical da a and an op imi ic ie gi en Ne Era Energ performance hi or .

M ell recommenda ion reflec a belief ha Ne Era Energ ill fall b ear end d e o marke correc ion b ho ld ri e in he ear follo ing gi en he ri ing pop lari of rene able energ and fa orable poli ical clima e. The Vi al Financial Informa ion i indica i e of he n al ola ili in Ne Era ock in he con e of he price- o-earning ra io.

R ab : The Biden Admini ra ion ha ignaled a foc on pda ing America infra r c re. Thi po ring, hro gh he propo ed $2.3 rillion infra r c re bill, i a po i i e ign and oppor ni for ili companie looking o ran i ion o cleaner energ o rce . A par of he propo al, ne a credi for he con r c ion of ol age ran mi ion line , a pre io roadblock o efficien clean energ , are o be crea ed.

Thi ne come a Ne Era Energ ha ec red he righ o de elop a 690 mega a olar projec in Io a, an endea or ha i e ima ed o co aro nd $700 million. Wi h hi de elopmen and a fig re of 5750 m c rren l prod ced rene abl b Ne Era, he f re i brigh .

O : In 2020, Ne Era a o al a e increa e from $117,691 million o $127,684 million and o al liabili ie increa e from $75,844 million o $82,755 million, reflec ing he recen in e men in capi al projec , par ic larl in he rene able ca egor . Appro ima el $14 billion in capi al a deplo ed, he large m in a ingle ear in he compan hi or .

Ne Era re en e ream can be fo nd in i core b ine ha i Florida Po er and Ligh (FPL), he prime energ pro ider in Florida. U ili ing FPL ca h and deb o f nd o her opera ion and con r c ion projec .

PG&E Corpora ion (PCG) Energ Prod c ion: 7,687 m S ock Price: $11.87 Re en e: $4,743 mm

Cornell Eq i

Re earch Repor

04/15/2021 Ne Era Energ (NEE) Anal

V

a F a ca I

: Ror Sheppard

a

Source: Capital IQ R

P

a

D b : Ne Era financial are no able in ha he , o er he pa 6 ear , ha e been recording lo m of ca h and eq i alen (an a erage of $986.66 million) i h a gro ing m of long erm deb , an increa e o $41,944 million in 2020 from $26,782 in 2018. Thi o ld eem o indica e a lack of financial heal h, a he compan ca h- o-deb ra io i or e han 89% of i peer companie .

W a Pa : A ri k ha co ld impac Ne Era performance i ariable ea her pa ern in he loca ion here energ i genera ed. Un al ea her pa ern ere een in Te a hro gho Jan ar and Febr ar 2021 meaning ha he genera ion i e in he f re co ld be impac ed b f re, imilar condi ion .

Addi ionall , a par of he Uni ed S a e en er h rricane and ornado ea on, genera ion i e ma po ibl be nega i el affec ed.

R ab B : While Pre iden Biden ha anno nced a progre i e infra r c re pa age hich ini iall li all he green ligh for companie like Ne Era, i ill need o make i a hro gh Congre , a proce ha ill likel ake mon h . Since Ne Era ha been performing ell ince he anno ncemen , c rren po i i e ne co ld be par of an ng aran eed infra r c re package (in i c rren form).

S c : In e or .com CFRA Eq i Re earch fool.com Yahoo Finance Ne Era Energ D ke Energ So hern Compan PG&E Technolog Re ie The Ne York Time Bloomberg SEC.go Capi al IQ Financial Time

Cornell Equit Research Report A

15 , 2021 Cheniere Energ (LNG) Anal st:David Oron

Ratings: B C The impact of the global Coronavirus Pandemic on the energ sector can not be overstated. Billions of people across the globe ere no under lockdo n, and energ consumption plummeting due to limited travel and other activit has made demand for energ such as oil and gas decline sharpl .

Cheniere has managed to offset the damage b investing in further LNG development, announcing the construction of Train 3 at their Corpus Christi drilling site.

After the stock price hit a lo of $32 at the beginning of the pandemic, Cheniere has no matched their pre-pandemic level and e ceeded it standing at roughl $73 toda .

C from Q4 2020

Adjusted EBITA: $1.576 billion

Adjusted EBITA: $1.002 billion

Current Price: $73.75

C

E

One- ear target price: $123.62

(L G)

Cheniere Energ is the leading liquified natural gas (LNG) producer in the United States, and has the second largest operating capacit for LNG in the orld. Founded in 1996, Cheniere embarked on its LNG journe as recentl as 2010, and onl e ported its first barrel of LNG in 2016. In just five ears, Cheniere maneuvered the industr aggressivel , gro ing revenue ear and ear and dominating the space. While the push to combat climate change has orried some investors about the potential for long term gro th in this space, the bottom line remains: ind and solar can t account for all consumption demand. The orld needs energ , and LNG is the cleanest, safest fossil fuel available. As such, for these reasons and for those outlined belo , Cheniere ill outperform: LNG. 2020 earnings sho ed a consolidated adjusted EBITA of $3.96 billion, a 35% increase of 2019. Cheniere's continued gro th has instilled hope in investors that it ill continue to emerge as the dominant force in LNG production. According to the International Energ Agenc , demand for LNG ill increase b as much as 38% b 2040, second onl to rene ables. While some orr about surplus and stagnant prices, LNG demand is poised to surpass suppl before 2030. Moreover, due to volatilit in the Middle East and the Persian Gulf, here Qatar e ports account for 25% of global LNG consumption, American companies like Cheniere present themselves as more reliable.

Cheniere s main competitors are EQT and Antero Resources. While there are certainl man different companies in the natural gas space, these three primaril focus on LNG production. As the technolog required for LNG is relativel ne , all pla ers have a significant foot in the door, and appear to share the space for no . The abundance of natural gas in the United States surel leaves room for multiple LNG actors, but as Cheniere is looking to e pand, it is crucial the invest in ne er and greener technologies that can set them apart.

Cheniere s business model sets it up for success: b dealing mostl in take-or-pa contracts, there is little to no volume or price risk. The nature of these long term contracts ensures a stead stream of cash, and as long as governments and private corporations continue to limit greenhouse gas emissions, LNG ill displace coal and crude oil. It is estimated that in the United States alone, there is enough natural gas for another centur , and therefore, Cheniere's prospects are bright.

Cornell Equit Research Report A

15 , 2021 Cheniere Energ (LNG) Anal st:David Oron

S

ce: Ya

F a ce

D : The main risk associated ith Cheniere is certainl not hat makes it unique: all LNG pla ers have a massive debt problem. In order to finance construction on their operations, Cheinere needed to borro billions of dollars to build their advanced liquefaction infrastructure and abide b all regulations in the emerging field of energ . It is important to note that most LNG developers began construction alread involved in other energ sectors; since Cheniere is solel LNG, there as no alternative revenue to offset the required capital to begin.

As such, Cheniere has amassed over $30 billion dollars in debt, and hence, an cash flo blimp could quickl force Cheniere to file for bankruptc . : LNG production is a length and costl process of liquef ing natural gas, bringing the naturall gaseous substance to a temperature several hundred degrees belo ero, thus transitioning it into a liquid. This results in a drastic decrease in volume, making e porting LNG much simpler. Ho ever, ith rising temperatures and mild inters, the liquefaction process is made less efficient. That is, it becomes more e pensive to produce LNG during armer eather. As the planet is e periencing a ear-over- ear increase in temperature, this realit poses a threat to Cheniere s profits. : Cheniere Investor Relations International Energ Association Investors.com Yahoo Finance Deutsche Welle SEC.gov Capital IQ EQT Investor Relations Reuters Bloomberg

Capital IQ

C

E

04/15/2021

( L G) A

:H

C

a

C

U da e

: $28.51

P gP

:

-

: $42.50

e (PLUG)

16 , 2021:

.H 2018

2019

;

2019

B

2020 C

A : -$100.469 G : -$418.333 EBI DA: -$535.469 52 : $75.49 52 : $3.80

C

e

(E ) ,

.

Sa

, 2020

, 95% , 26, 2021. B .

$75.49 J ,

F a ca : , ,

EBI DA.

,

- - 2021

,

c

.

4 2020

G . ,

100 2021

A F

C

(FCEL) : $9.7 : $69.5 EBI DA: -$25.5

,

J ,

50

-A

.B 37.

16 , 3

E

,

.

Ma e : .

B

, E

B

(BE) : $25.97 : $794.2 EBI DA: -$28.5

.B ,

E

.I

,

-

O e R

: ,

.B , EBI DA

B (BLD ) : $21.87 : $103.9 EBI DA: -$35.0

O e

.

-2014 ( .

. I 2013, ) 2016,

e : ,

.B .

C

E

04/15/2021

( L G) A

V

a F a ca I f

:

a

Source: Capital IQ R

P e

Deb :

a

E

, ( 2020 - -

$41,944 Wea e Pa e

$986.66 $26,782 2018.

89%

:A

6

,

)

, , .

E .

2021 A

J

F .

, ,

, .

Re e ab e B

:

B E , .

C , (

S I C

ce : .

CF A E G&E

,

E

.

F

).

E B

E EC.

D C

E I

F

C

E

04/13/21

D

( D .A) A

C

:H d

C

a

R

U da e

C

C : $166.3B : $180.5 B EBI DA: $27.7 B /E : 11.34 D : 3.25% : $2.6/BBL C

e Sa 4 2020

c

E( D

E D

C D

D

B

) : $45.18 : 8.35% : $119.7 B

C : $55.61 : 6.07% : $179.8 B

C

(C : $102.00 : 4.88% : $94.5 B

A( E ) : $12.12 : 2.89% : $33.6 B

LC (B ) : $24.60

(

)

)

: $38.76

a D c S e

-

c (RDS.A)

:D

A : $44.94

C

E

04/13/21

D

( D .A) A

V

a F a ca I f D

R S

A

a

LC

P e

:D

D

F

2021

a

a ed Wea

e .L

H d ca b

P ce : H , 50,000

75,000

.A

,

. .

De e

a

O Ref

g Ma g : G . .

EC ; .

C

O e

/ De a

De e

e

P

ec : 60%

38%

. ,

S C

ce : I

F

, F

C BC

, & G

.

E

,

Cornell Equity Research Sector Report | Spring 2021 | Consumer Staples

Consumer Staples Sector Report Industry Trends The consumer staples sector consists of a wide variety of companies many of which offer essential products consumers need for their daily lives. Because of this composition, the consumer staples sector is rather recession proof. In fact, the value of many companies has actually increased as a result of the pandemic. Historically speaking, this is not atypical behavior of the consumer staples sector, as this sector is rarely or very minimally impacted by economic downturn.

The industry's stable recession proof earnings profile is also a double-edged sword. On one side it means this industry has a steady and loyal customer base but it also means that company’s in this sector are less lucrative for investors. Moreover, the recent stimulus and ongoing vaccine rollout could mean that less people will be staying at home and demanding the same quantity of consumer staples.

Still the pandemic has had a significant impact on this sector. The lockdown along with people’s apprehension for shopping in person pushed many to e-commerce, many companies in this sector have seen themselves forced to create and utilize online retail platforms creating a dramatic change in consumption channels. As we move forward, we hope to see more companies in this sector advancing their technology and online platforms.

Industry Outlook In 2020, the consumer staples sector almost consistently underperformed broader indices such as the S&P 500 and the NASDAQ. While growth was strong in consumer staples throughout 2020 and the demand for consumer staples increased, the immense gains in consumer discretionary and info-tech captured a majority of the broader market growth. Consumer discretionary captures household cleaning products and other industries that soared during the pandemic as an influx of stimulus cash tended to be spent on discretionary products by consumers. The growth of info-tech in 2020 was a response to the pandemic necessitating a greater reliance on technology products.

More people were forced to stay home and the need for staple goods trended upwards during the pandemic. This resulted in the overall industry gaining roughly 11% in 2020. However, not every industry of consumer staples experienced this level of growth, such as tobacco and beverages.

These sectors did experience growth during the pandemic but, as these products were not as essential during the pandemic as other industries within consumer staples, they did not realize significant gains. As the economy recovers, dependency on consumer staples is expected to decrease. The pandemic created a buying frenzy in consumer staples that pushed stock prices higher than when the year started. So, it is likely that consumer staples will decrease to pre-covid levels if the demand for these products is not sustained.

Cornell Equit Research Report 4/15/2021 Be ond Meats (BYND) Anal st:

Joseph Rubinstein

Ratings: S

C

a

Current Price: $133.95

U

a

B

The pandemic significantl damaged BYND s food services channels and the changing mi of revenue channels could have negative consequences for earnings in the short term Launched 5 new products in 2020 with plans to launch two new versions of the flagship Be ond Burger

C

Sa

from Q4 2020

Revenue: $11.5B P/S: 1.58

Revenue: $9.7 B P/S: 2.67

Revenue: $13.8B P/S: 1.58

c

M a

(BYND)

Since being listed on the NASDAQ on Ma 2, 2019, Be ond Meat s market capitali ation has increased from $1.5 billion to $8.4 billion, a 462% gain in less than two ears. BYND is recogni ed as one of the originators of plant-based meat products and its Be ond product line is sold in major supermarkets and in restaurants such as Carl s Jr. and Denn s.

As of April 6, BYND is trading at $133.95. I believe that this equit is a and the stock price is e pected to decrease to $84.39 over the ne t two ears. This is because of the steep competition that BYND faces in the ever-e panding plant-based meat industr and the unreachable sales figures built in to a $133.95 valuation. A comps anal sis demonstrates that BYND is trading at significantl higher multiples than its competition, even when factoring for revenues growing at a much higher pace than competition.

M sell recommendation is based on the belief that BYND will not be able to e pand its profit margins and market share at a rate that is implied b the current valuation given growing competition.

R a a F c C a : BYND s distribution channels are broken down into retail, primaril supermarkets, and foodservice. In 2019, these segments made up nearl even portions of revenues but, with restaurant closures and the panic-bu ing fren of the pandemic, in 2020, retail channels accounted for 73.9% of sales while foodservice accounted for 26.1%.

While foodservice revenue decreased b 30.6% in 2020, overall revenues grew b 36.5%, demonstrating the large growth e perienced b the retail channel. However, retail numbers will not be sustainable, especiall with the new competition from major food brands like Kroger and T son, who are e panding their offerings in the plant-based meat industr .

O : In 2020, BYND saw its revenues grow to $408.6 million from $297.9 in 2019. Since first reporting revenues in 2018, BYND has seen a 115% CAGR despite business slowdowns from the coronavirus pandemic.

However, over this same 3 ear period, BYND has posted net losses consistentl , with net losses over the period topping $95 million.

To get to a P/S figure that is in line with competitor averages, BYND would have to increase its revenues b 955%. Even given the most optimistic estimates of compounded annual growth rate in the plant-based meat industr (14-17%), BYND would have to grow at a rate far higher than the overall industr to justif current valuations.

Cornell Equit Research Report 4/15/2021 Be ond Meats (BYND) Anal st:

Joseph Rubinstein

V

a F a ca I

a

Be ond Meat, Kellogg, Hormel and T son Share prices since 3/15/2019

So ce: Capi al IQ R

P

a

Ca B : BYND has consistentl posted losses since its inception. While investors are betting on profits, the timetable is still quite long given current assumptions. While high operating costs have led to net losses in 2018-2020, the compan is forecasting increasingl high capital e penditures and operating e penses over the ne t few ears, primaril due to production facilit e pansions domesticall and internationall . Given the current growth rate, BYND will not be able to make a profit over at least the ne t 3 ears if not longer.

C -19: As a result of Coronavirus, foodservice channels were disrupted, leading to falling foodservice revenues. The e tent of restaurant damage done b the pandemic is immeasurable and it is hard to forecast when the restaurants that sell Be ond products will be able to reach pre-pandemic numbers.

N P a -Ba M a C a : BYND will be facing increasing competition from large traditional animal-protein companies as the begin to enter the plant-based meat industr . Companies such as Unilever, Kraft Hein and T son have acquired or created plant-based subsidiaries that will compete directl with Be ond products. These companies have larger established customer bases and more capital than BYND, which could lead to BYND being priced out of the market, especiall given alread tight margins. BYND s abilit to compete with these companies will determine future growth prospects.

C

E

04/08/2021

&G

( G) A

:B

C

: $136.72

C

-

&

&G B ,

(

: $155.34

)

,

&G .

-

. &G C

:K

, ID-19

C C

.

,

E

A &G ,C &D L .A

, ,K

-C

C

,

.

G

'

, . &G

' , &G'

. ,

.

A

C 1 2020

A

8 ,

&G

$155.34 DCF ACC 5%

( G)

.I 13%

$136.72. I

, 10% .I

, &G

'

. &G , : $50.72B C

. : 150.07B

: C

,

&G

' .

&G

$336,719. &G $37,865.1,

' .A .C

C

&G

: $16,471 C

/ , .

: $67.48B

,

0.47. &G , . .

&G . .

C C

&D : 4,896 C

,

&G .

G

& ,

: $21.62B

.

C

E

04/08/2021

&G

( G) A

-

,A & ,

:K

2008

Source: Capital IQ

C

-19:

&G

.

-

&G

,

,

.I

,

&G

.

E

C

:

,

&G .I .A

, &G

,

,

.

&G

I

: .

.

F

&G I

B

EC.

C

I

F

,

Cornell Equit Research Report A

9 , 2021 Target (TGT) Anal st:Gracel n Goodridge

Ratings: B

Current Price: $205.72

One- ear target price: $258.02

Ta e (TGT) C

e

Sa

c

from Q4 2021

Revenue: $555.23 B Net Income: $13.51B Dividend Yield: 1.6%

Revenue: $178.63B Net Income: $4.34B Dividend Yield: 0.8%

Revenue: $132.50B Net Income:$2.59B Dividend Yield: 2.0%

Target Corporation stock has been traded since its initial public offering in 1967. Toda , the stock has a market capitali ation of $102.43 Billion and is one of the biggest retail giants in the Consumer Staples sector.

The stock is currentl trading at 205.71 (4/14/21). However, using the average between the lowest projected stock prices that uses the 25th percentile multiple of the last twelve months EV/ Revenue, and the highest projected stock price that is calculated using the 75th percentile multiple of the projected 2022 EV/ EBITDA, the stock is currentl undervalued and should be trading at 258.02. Therefore, I recommend consumers b stock in Target.

Ne S e O e a d Sa e-S e Sa e : One of the primar growth drivers for Target are new store openings and same-store sales (a metric used in the retail industr to describe sales of stores that have been open for more than one ear). In 2020, Target opened 24 new storefronts, 22 new stores in 2019, and 10 new stores in 2018. Following this trend, it is likel that Target will open more storefronts this ear (2021) as well.

Moreover, the sales of e isting storefronts are likel to increase as well.

Target s brand focuses on the same price differentiation that Walmart offers, with an increased customer e perience (better customer service, better store la -out etc.). Because of the pandemic, man consumers have pent-up demand, increased savings, and additional stimulus that the are able to spend on shopping. Especiall on shopping that offers essential items such as food, toiletries, over-the-counter medicine etc. as target does. On the flip side, despite the consumers who have the e tra savings, the povert rate in the U.S. has increased b 2.4 percent because of the pandemic. These consumers need cheap options to fulfill their ever da needs which Target s products and prices can provide. Target s brand appeals to both consumer who have e tra savings, but still want a cheap and better customer e perience than sa Walmart, while also appealing to penn -pinching consumers that need ine pensive products to support themselves and their families. From being able to cater to both t pes of consumer, Target will likel see an increase in same-store sales as well as from new storefronts.

F a ca Te d : In addition to the new store openings and the macroeconomic climate, ear over ear target has historicall seen an increase in revenue with e ception of 2013 and 2016 (see chart below). For reasons described above, it is unlikel this trend of increasing revenue will change. This continuous increase in revenue indicates demand for the compan and its products, making it a strong investment that will likel result in an increasing stock price.

Cornell Equit Research Report A

9 , 2021 Target (TGT) Anal st:Gracel n Goodridge

V

a F a ca I f

a

Target s Revenue

S

R

ce: Ta e 10K Yea

P e

2010-2020

a

Re a a R : Target s brand recognition and reputation is incredibl strong. However, if Target is unable to continue to differentiate itself from its competitors, provide qualit products at a cheap price point that are relevant for consumers, and/or respond to changes in consumer preferences and needs, the reputation of the brand could be negativel affected and consumers could switch to shopping elsewhere.

C be ec a d Da a P ac : Shopping at an store involves trust in the compan that the will responsibl handle the consumer s credit card information and data. If Target breaches this trust, the or if the compan is unable to keep up with changes in increasingl strict regulations, Target could lose customers and also face litigation that would be ver costl .

Re a a dS C a C a e : Changes in ta or trade polic and/or failure to adhere to e isting and changes in federal, state, local, and international law could result in costl lawsuits that would reduce the bottom line of the compan . Moreover, changes in relationships with vendors or operations of the compan s suppl chain could result in not receiving the necessar products which would negativel affect operations of the business and increase customer frustration with the brand that would likel ultimatel result in decreased profits.

S ce : Target Investor Relations CFRA Equit Research Forbes Yahoo Finance Bloomberg Capital IQ

Cornell Equit Research Report A Rating: Se

C

a

8 2020 Walmart Inc. (WMT) Current Price: $139.31

U da e

Revenue for the fourth quarter beat estimates at $152.1 billion versus the $148.4 billion estimate Adjusted earnings per share misses the mark at $1.39 versus the $1.50 estimate E-commerce revenue climbed b 69% over the quarters, it s smallest increase since the pandemic hit The leading Indian e-commerce compan , which is 77% owned b Walmart is seeking valuation that could top $35 Billion.

Walmart files for Trademark Fintech Unit Ha el b Walmart Walmart will raise the average wage for its hourl emplo ees above $15 an hour C e Sa from Q1 2021

c

Revenue: $44.769 M Comparable: 11.1% eCommerce: 74.8%

Revenue: 28,339 M Comparable: 20.5% eCommerce: 118%

Wa

a

Anal st:Lesl Gissell Zhica One ear target price: $130

I c (WMT)

While Walmart ma have begun as a brick and mortar store the compan since then has evolved tremendousl . The discount store went public in August 25, 1972 and, since 1974 the compan has provided an annual cash dividend paid quarterl to shareholders. Walmart serves over 220 million customers weekl and emplo s over 2.3 million associated worldwide.

As of April 13 th, Walmart (WMT) is trading at $139.31. I believe that this equit is overvalued and expected to decrease to $130.

M sell recommendation reflects a belief that Walmart will underperform due to its current investments that is overextending the compan be ond its core business strateg .

E-C e ce: Walmart is currentl working towards taking the ecommerce giant FlipKart public. Man are stating that the compan could be valued at $35 billion.

F Tec : Walmart has also delved into the financial technolog arena. The compan recentl trademarked the name Ha el that could potentiall offer: issuing credit cards to offering credit repair services.

O e e : In the fourth quarter of the Fiscal Year 2021, Walmart s total revenue was $152.1 billion, a $10.4 billion or 7.3% increase. The compan also saw it s ecommerce sales increase b 69%.

The compan looks forward to building the next generation business model b investing in automation. The compan expects FY22 capital investments to be nearl $14 billion to build suppl chain capacit and automation to sta ahead of demands and improve the customers experience with increased productivit .

The retail compan hopes to enhance the digital customer experience b growing related businesses with growing margins such as marketplace, advertising, financial services and data moneti ation.

Lastl , Walmart will invest in it s associates b raising wages for an additional 425,000 frontline associates after having done the same for 165,000 associates last fall.

Revenue: 30.737 B Comparable: 14.2% ECommerce: 118%

Cornell Equit Research Report A

8 2020 Walmart Inc. (WMT) Anal st:Lesl Gissell Zhica

V

a F a ca I

a

S ce: Mac e d R P e a E-c e ce: Walmart s greatest risk is online retailers like Ama on who have direct access to customers. As online retails grow, Walmart needs to take the necessar steps to get ahead of the game and improve it s e-commerce site. While it is currentl building up its own platforms, the compan needs to make sure that the cost of its investments in innovation are not outweighing its benefits.

C Re a C a ce: Walmart s global presence does not just facilitate it s suppl chain, it can also pose a great economic risk as there is great regulator uncertaint . For instance, in 2014 the Chinese government fined Walmart for almost $10 million of food safet violations. This also required them to reorgani e their inspection, training programs and even recalling certain items. These actions raise the cost of providing Walmart s services and shareholders bear some of those costs with lower share prices or less dividend income.

La : Walmart s grandeur has also exposed the retail compan to man lawsuits. Just in 2018 the compan agreed to pa $65 million dollars to settle a class action lawsuit from $100,000 California Cashiers who accused the compan of failing to provide seating during shifts as required b California law. In 2013 the compan paid $81.6 million dollars in damages over improper disposal of fertili ers and, in 2012 the settled for $1 million over alleged racist remarks made in Walmart store. All in all these lawsuits add up and ultimatel affect both shareholders and customers.

S

ce :

Walmar In e or Rela ion In e opedia.com fool.com Yahoo Finance Bloomberg Capi al IQ Macro rend CNBC B ine In ider MSN Mone Ne PYMTS.com NASDAQ

Cornell Equity Research Sector Report | Spring 2021 | Industrials

Industrials Sector Report Industry Trends With our team's individual analysis of Lockheed Martin Corporation (LMT), JetBlue Airways Corporation (JBLU), and Booz Allen Hamilton (BAH), we anticipate that the industrial sector will continue to outperform the rest of the market. As of April 15, 2021, the sector had seen a one-year gain of 61.37%, the highest of any other sector. This is also higher than the S&P 500 one-year gain of 46.53%. Based on the historical sensitivity of the industrial sector in relation to the rest of the economy, many companies have taken the pandemic as an opportunity to bolster its supply chains and increase resistance to future recessions. These long-term investments should ultimately reduce costs and ensure ongoing financial success.

Industrial companies are much better off now than they were a year ago, and their focus has shifted from staying afloat to becoming more flexible in the long term. Increasing supply chain resilience is at the forefront of this effort. Companies are investing in the digitization of supply chains and expanding from a linear supply model to one that is network based.

Under the Biden administration, we expect to see a shift toward green energy initiatives and sustainable solutions. JetBlue has already implemented a major green energy project by purchasing Carbon Offsets for all flights and switching to Sustainable Aviation Fuel for certain routes. Long term success of these projects can significantly reduce costs, and with air traffic still much lower than pre-pandemic levels, airlines with strong balance sheets have a great opportunity to invest in alternative fuels at reduced prices.

Booz Allen Hamilton is attempting to secure its supply chain by working more closely with one of its largest clients, the Department of Defense. It is in a prime position to help the Department of the Defense develop its 5G-based technology. BAH will aid the Air Force in an artificial intelligence and 5G spectrum sensing application that implements radio frequency signal processing with machine learning techniques. Developing an expertise in these cutting-edge fields will allow it to outperform competitors and secure more contracts from both private and government entities.

Industry Outlook Our analysis indicates that the industrial sector should outperform the rest of the market both in the short run and long run. The continuing success of industrial companies will be largely dependent on the restrengthening of key supply chains that were weakened during the pandemic.

Additionally, changing policy brought on by the new administration can have great impacts on all aspects of operations. Consider Lockheed Martin, who relies heavily on government contracts for revenue, and JetBlue, whose second largest operating expense is fuel. Both components are directly impacted by government decisions. Consequently, periods of uncertainty and declining stock price for industrial companies often surround election years. If companies pursue the new green energy initiatives which will be incentivized by the government, they should see stronger growth than those who do not. The most successful companies will be those that can quickly adapt to new market conditions and integrate technology into their supply chain. Overall, we expect the sector to outperform the rest of the market.

Cornell Eq it Research Report April 9th 2021 Boo Allen Hamilton (BAH) Anal st:Ashle Zhang Ratings: HOLD

C

a

U

C rrent Price: $82.23

a

C rrent Market Cap: 11.36B Re en e: $1,904,020 EBITDA: $205,370 P/E: 21.04 52 k High: 100.26 52 k Lo : 68.3413 On April 8, 2021 Boo Allen Hamilton on a contract bid against CACI for a $213.8 million Na contract dealing ith acq isition and logistics s pport.

Boo Allen Hamilton as chosen o er CACI beca se of the compan s technical ad antage in high speed hiring and staffing and their agenc s interface.

C

Sa

from Q4 2020

Re en e: $1.90M Gross Profit Margin: 22.85% C rrent Ratio: 1.99

Re en e: $12.09M Gross Profit Margin: 31.64% C rrent Ratio: 1.40

Re en e: $42.8B Gross Profit Margin : 77.87% C rrent Ratio: 1.50

B

A

Ha

One ear Target Price: $100.79

(BAH)

Since Boo Allen Hamilton s listing in the Ne York Stock E change on No ember 16, 2010, the stock has gro n more than 480%. Boo Allen Hamilton has become the leading cons lting firm in the areas of c ber sec rit , go ernment defense, and digital prod ct inno ation.

As of April 1, Boo Allen Hamilton (BAH) is trading at $81.74. I belie e that this eq it is fairl al ed, b t e pected to increase to $100.09 ithin this ear. I arri ed at this concl sion b cond cting a DCF anal sis ith a 4% gro th, 10% operating margin, and a WACC of 3.19% across 5 ears. I sed these ass mptions based off of historical data and an optimistic ie gi en Boo Allen Hamilton s performance histor .

M hold recommendation reflects a belief that Boo Allen Hamilton ill contin e to perform ith the market, gi en its recent a ards in 5G e perimentation, and ha e a gro th rate similar to its a erage from the past three ears.

5G E a M a : 5G is the 5th generation cell lar net ork hich pro ides greater band idth and s pport for Internet and telephone net orks. With the recent rise in 5G technolog inno ation, the Department of Defense selected Boo Allen Hamilton to f lfill $600 million in a ards for 5G e perimentation across fi e U.S militar locations. This is in part to accelerate the sage of 5G in the militar b the Department of Defense.

Boo Allen Hamilton is in a prime position to help the Department of the Defense de elop its 5G-based technolog . BAH ill aid the Air Force in an artificial intelligence and 5G spectr m sensing application that implements radio freq enc signal processing ith machine learning techniq es.

O : In 2020, Boo Allen Hamilton sa a 161.24% increase in Cash and Short Term In estments. After the pandemic, Boo Allen Hamilton consolidated their reso rces, rep rchased stock, and capabilit t ck-ins, across their competitors. The increase in cash allo s them to react to the market accordingl and generate the best sol tions for their shareholders in the near f t re.

Internall , the compan introd ced 6 pillars s rro nding di ersit and incl sion, a strong addition to their alread di erse management and board of directors. Their Vision 2020 Gro th Strateg has created an accelerated gro th in adj sted EBITDA ith o er 10.5% gro th since 2016.

Cornell Eq it Research Report April 9th 2021 Boo Allen Hamilton (BAH) Anal st:Ashle Zhang

V

a F a

a I

a

Boo Allen Hamilton Stock Price since 2010 IPO

S

ce: Ya

R

P

F a ce a

La Ma : In March alone, U.S emplo ers added 916,000 jobs indicating a strong reco er for the labor demand post-pandemic. Boo Allen Hamilton s prime ork as a cons lting firm req ires a high caliber emplo ee ho can deal ith the inno ati e technolog adaptations. Ho e er, the strong and competiti e labor market has created head inds for Boo Allen Hamilton as the emplo ees the seek are in high demand from competing firms.

La C P : Boo Allen Hamilton has a niche position as an information technolog cons lting firm and is a long-time cons ltant ith federal agencies ho look to them for their areas of e pertise. As the importance of c bersec rit gro s, commercial companies, s ch as Microsoft, Ama on, and Fortinet, are entering the competition pool.

P -COVID R : Internall , Boo Allen Hamilton is still ns re of the effects of the COVID-19 pandemic on its emplo ees, in terms of headco nt, attrition rates, and the degree to hich the ret rn to orking in offices, or from home. Other cons lting companies, s ch as Deloitte, ha e stressed their opinions that remote ork is here to sta , for the near f t re, as their S dne offices are offering ol ntar in-person ork ho rs.

The rapid distrib tion of the three accines ma pro ide tail inds for a faster ret rn to office ork.

S : Boo Allen Hamilton In estor Relations Yahoo Finance SEC.go Capital IQ Valdosta Dail Times Wall Street Jo rnal Wall Street Jo rnal Markets Washington Technolog Wikipedia

Cornell Equit Research Report A il 8 h 2021 Lockheed Martin (LMT) Anal st:Anthon Lopardo

Ratings: BUY C m a U da e LMT Acquired 37 defense contracts in March 2021 totaling $9.9 Billion. Notable contracts include those for a Ne t Generation Interceptor and a Guided Multiple Launch Rocket S stem LMT paid a $2.60 dividend at the end of Q1 indicating strong cash flo s LMT sa several successful projects in overseas markets and acquired ne contracts ith foreign governments The F-35 Sustainment Contract as signed b the Pentagon for 1.28 Billion

Current Price: $385.92

One- ear Target Price: $445

L ckheed Ma i (LMT)

The calamities of 2020 have defined our outlooks for the industrials sector in 2021. The pandemic caused mass economic shutdo ns, suppl chain disruptions, and record lo unemplo ment levels. Our anal sis of the Industrials sector in late 2020 indicated a strong recover trend among most Industrials companies. We e pect this trend to continue, ho ever, pre-pandemic performance levels ma not be seen for several ears.

Lockheed Martin Corporation is one of the largest companies operating in the Industrials sector. The speciali e in aerospace, defense, securit , and advanced technologies. Since the onset of the pandemic, Lockheed Martin has underperformed the rest of the industrials sector and the S&P 500 inde .

Ho ever, it has seen an increase in net earrings from 6230(millions) in 2019, to 6833(millions) in 2020, leading to a 3.32% increase in gross profit.

Industrial s companies have taken steps to shield themselves from future pandemic-like recessions. These steps include investments into solving forecasting challenges, virtual production simulators, suppl chain resilience, and automation. Unlike other industrial companies ho invested in themselves to become more resilient to the pandemics conditions, Lockheed invested in its suppl chain b accelerating pa ments b $300-500 million per eek. This helped to ensure that its suppliers, man of hom are small businesses, continue to operate in the future.

These actions ensure the secure future of its suppl chain. Ho ever, the future of its demand sho s signs of uncertaint . Lockheed Martin is highl dependent on government contracts for its revenue, and ambiguit during election ears has historicall led to pull backs in its stock price. Despite its strong balance sheet, this could be a reason for less than e emplar recover . Follo ing this ear's administration change, President Biden contradicted the e pectations of his part b requesting $753 Billion for defense spending, a 1.7% increase over Trump's 2020 budget. This ne s correlates to a share price increase of nearl 15% as of April 9th, 2021. This indicates that the resolution of defense spending uncertainties is a catal st for LMT stock gro th.

Cornell Equit Research Report A il 8 h 2021 Lockheed Martin (LMT) Anal st:Anthon Lopardo

Vi

al Fi a cial I f ma i

C m ai : Lockheed Martin's recover has underperformed that of the industrials sector overall, and the S&P 500 Inde .

One of its largest competitors General D namics has a ver similar business model, and its stock has seen much better performance through March of 2021, despite its financial shortcomings. LMT outperforms GD in almost ever aspect of the balance sheet, et it does not see the same or better returns. This leads us to believe that the stock is undervalued.

Despite this, Oracle onl possesses 3 percent share of the cloud market as AWS and Microsoft A ure dominate the market ith first-mover advantages and better developed technolog .

Ri k P e ial Lockheed Martin orks on the cutting edge of technolog , consistentl seeking innovative solutions. Therefore, their products can be prone to failure. For e ample, its F-35 fighter jet, hich has an estimated lifetime cost of 1.7 trillion per plane and has been deemed one of the greatest militar spending failures in recent histor due to its ongoing failures to meet the promised specs, and its multiple part failures.

Lockheed Martin also has an e tremel high dependenc on receiving contracts from the US government. 82% of its prior ears revenue came from such contracts. This makes it e tremel vulnerable to political changes and cuts in the defense spending budget. If a drastic spending cut ere to occur, then Lockheed Martin ould face strong competition from BAE S stems and Airbus for contracts from the foreign governments hich the hold good relations ith.

S ce : Investors.com Capital IQ MarketRealist Yahoo Finance

C

E

A

9

2021 J B

A

C

(JBL ) A

:B

C

Compan Update

:E

: $14.84

D

: $24.35

JetBlue Air a s Corporation (JBLU)

J B

C

J B

ID-19

75% ,J B

- ,

-C

ID

N :N

J , J B 92.4%

L

A

C ,F

,B

.L

L

,

, .

2020.

J B

, 2020. J B , C ID

,

, ,

, ,

2020.

Competitor Statistics

C ID 2010.

4 2020

- -

,J B 5

, 2019. B

$8.1 B J B ,

C

ID

J B

M G 22.85% C

: $1.90M M :

, ,J B

G 77.87% C

: $12.09M M : : 1.40

: $42.8B M : 1.50

G

6.8% GD , , .

: 1.99 J B

G 31.64% C

. ,

:

.F .

C

E

A

9

2021 J B

A

C

(JBL ) A

:E

D

Visual Financial Information M

C

, JBL

C

,L

5

Risk Potential C

.

ID

J B , ,

, FDA

J .

J ,

-

J B , ,

.F ,

,

,

,

.J B J A

Sources: J B I

, ,

F

2020 F

C

C .

I

J

&

Cornell Equity Research Sector Report | Spring 2021 | Technology

Technology Sector Report Industry Trends COVID-19 has had a major impact on the entire market and information technology was no exception. At the beginning of the pandemic, we observed a large dip in the market that closely mimicked the S&P 500.

This was brought on by concerns over diminished business travel, lower client confidence, and general uncertainty.

However, the sector has displayed a rapid recovery boasting higher returns than the S&P 500. This was largely driven by people adapting to virtual solutions for their work and home lives. Looking ahead, we can expect many of the habits formed during the pandemic to carry into the coming years, which will likely contribute to stable growth for the sector.

Industry Outlook In the 5-year span, it is clear to see the information technology has outperformed the S&P 500, but it is also important to note the sub sectors that have shown tremendous growth during this period.

While the benchmark is near a 100% growth, the areas of software as well as technology hardware, storage, and peripherals boosted over 300% since 2016. Even prior to the pandemic, advancements in technology and innovation have led to the growth of many tech giants and tech startups. This is also emphasized by the fact that the US is leading the global landscape on technology innovation, thanks to its business dynamism, strong institutional pillars, financing mechanisms, and vibrant innovation ecosystem.

Although tech benefited from the pandemic and is poised for long-term growth, there has also been a market shift towards value stocks as the economy is preparing for reopening. The recovery of the bond market and spike in treasury yields to 1.56% (as of April 16) caused the info tech sector to pull back in March, resulting in a correction of almost 10% from record highs in February.

Nonetheless, it has since recovered and reached all-time highs -- currently trading at a P/E of 32.6x, which is likely to increase given the strong growth expectations. Some key valuation drivers that will fuel the growth of the sector this year include continued investments in digital enterprise spending, lasting impact of a flexible work environment, and pent up demand for digital and data infrastructure. According to Fitch Ratings, specific areas of growth include automotive electronics, expansion of 5G, and rise of data centers.

Cornell Equit Research Report 4/7/21 Snap Inc (SNAP) Anal st:Luc Beck Ratings: H d

Current Price: $60.23

C

S a I c (SNAP)

a

U da e

Market cap: 90.85B Re enue: 2.507B (2020) EBITDA: 45.2M (2020) 52- k high: 73.59 52- k lo : 12.01 C

e

Sa

c

from Q4 2020

Monthl Acti e Users: 2.8B Re enue: $28M EPS: $3.88

One- ear Target Price: $34.09

From Q4 in 2019 to Q4 in 2020, Snap Inc s Dail Acti e Users increased 22% ear-o er- ear to 265 million. In addition, its fourth quarter re enue increased 62% ear-o er- ear to $911 million, and its fourth quarter operating cash flo impro ed 21% ear-o er- ear to $(53) million.

As of April 7 th, 2021, Snap Inc (SNAP) is trading at $60.23. I belie e that this equit is o er alued. I arri ed at this conclusion b conducting a DCF anal sis ith a 1.8% gro th and a WACC of 9.5% across 5 ears. It is important to note that due to the olatilit of the technolog sector, the target price ill be strongl influenced b in estor and consumer sentiment along ith Snapchat s abilit to engage its target audience. Here is an e ample of Snapchat s olatilit : Snap stock price closed at $12.10 e actl one ear ago on April 7 th, 2020, so it is currentl up more than 400%.

M hold recommendation reflects a belief that despite Snap Inc being o er alued, it ill continue to perform ell gi en its continuousl e panding Snapchat user base.

Monthl Acti e Users: 353M Re enue: $1.29B EPS: $0.27

S a c a: Snapchat is a mobile app de eloped b Snap Inc that is best kno n for its photo and ideo enhancing tools. Another one of Snapchat s unique identifiers is its temporar message s stem: an picture, ideo, or message sent is onl a ailable to the recei er for a short period of time before it becomes inaccessible.

Since its first release, Snapchat has added a ariet of ne features such as li e ideo chatting, Bitmoji a atars, and Disco er channels. The a erage user opened Snapchat 30 times a da in Q4 2020. With this said, e can e pect that Snapchat ill continue to ha e a strong hold on social media in 2021 and be ond.

Monthl Acti e Users: 459M Re enue: $706M EPS: $0.43

O e e : As stated earlier, Snap s re enue increased 62% to $911 million in Q4 2020, compared to the prior ear. This jump in re enue is likel due to its e pansion of ad ertiser relationships. Man ad ertisements sho up in the form of Snapchat lenses or filters that users can interact ith. This unique integration of ad ertisements into the user e perience has on Snap ne partners such as NYX Professional Makeup, Ralph Lauren, S eat, and The Ne York Times.

Snap launched a record 97 ne international Disco er channels on Snapchat in Q4 2020. It reported that o er 90% of the U.S. Gen Z population ie ed its disco er platform in Q4 2020. In addition, Snapchatters o er the age of 35 spent 30% more time dail on a erage ie ing Disco er channels in Q4 2020.

Snap s disco er platform is clearl popular among arious generations.

Cornell Equit Research Report 4/7/21 Snap Inc (SNAP) Anal st:Luc Beck

V

a F a ca I f

S

ce: B

R

P e

e

a

fA

a

C e : Snap faces man competitors in the social media market, particularl those such as Facebook, T itter, and Pinterest. Facebook tried to acquire Snap in 2013 for $3 billion but as rejected. Since then, Facebook has added a number of features to Facebook messenger such as camera effects and Facebook Stories. The similarit bet een Facebook s ne features and Snapchat s filters and stories could potentiall threaten Snapchat s user base.

Re a ce O e Se ce : Snap hea il relies on Google Cloud and Ama on Web Ser ices for the majorit of its computing, storage, and band idth. In the beginning Januar 201, Snap committed to spend $2.0 billion ith Google Cloud o er fi e ears and $1.1 billion ith AWS o er si ears. Since then, Snap has built its soft are and computer s stems around those ser ices. The le el of ser ice pro ided b Google Cloud and Ama on Web Ser ices could affect its users as ell as its ad ertisement partners. If either ser ice ere to increase pricing terms or limit Snap s access to their products, it ould harm Snap s business operations.

U e e gage e : 48% of Snapchat s users is comprised of people bet een the ages of 15 and 25. With a oung target audience, it can be difficult to sta up to date on the latest trends and keep users engaged o er time. Snap s success is largel determined b its abilit to introduce ne and e citing products and ser ices.

Its updates must be compatible ith iOS and Android operating s stems hich are constantl changing. Snap must also be careful not to fall ictim to too man ad ertisements hich could cause users to lose interest.

With all of these factors affecting Snapchat and the technolog sector in general, its success can be particularl olatile compared to other sectors.

S ce : Snap Inc In estor Relations FB In estor Relations T itter In estor Relations Pinterest In estor Relations In estor s Business Dail Business of Apps Capital IQ Financial Times Statista

Cornell Eq i

Re earch Repor

4/06/2021 A ana (ASAN) Anal

Ra ing : Modera e B C U Marke Cap: 5,593.3 M Re en e: 227 M EBITDA: (172.7) M 52 Week Range: 20.57 43.72 Q4 FY 2021: 59% Re en e Gro h YoY 88% Gro margin (48.6)% Adj. Opera ing Margin

C

S

Q4 FY 2021:

Re en e: $227 M Ne Dollar Re en ion: 115% EV/Sale : 24.91

Re en e: $385.5 M Ne Dollar Re en ion: 123% EV/Sale : 20.15

Re en e: $1,802.9 M Ne Dollar Re en ion: 132%* EV/Sale : 30.45

C rren Price: $33.46

A

I

:S e en Dong

One- ear Targe Price: $39.42

. (ASAN)

A ana i a projec managemen SaaS compan ha pro ide orkflo planning and organi a ion for f nc ion eam o elimina e coordina ion inefficiencie . I er e o er 93,000 c omer i h 1.5 million er and compe e in a gro ing b compe i i e a k managemen of are marke .

Since A ana direc li ing in he NYSE on Sep ember 30, 2020, i price ha increa ed 27% and c rren l rade a $33.08 [4/6/21]. I belie e ha A ana i nder al ed a $39.42 ba ed on a comparable compan anal i ing he 75 h percen ile EV/Sale m l iple a i ill in he earl gro h age and poi ed for higher re en e gro h han i e abli hed peer hile ha ing imilar al a ion .

M b recommenda ion i con ingen on A ana abili o no onl con in o l impro e and differen ia e i prod c o main ain rong gro h and margin b al o i abili o increa e dollar-ba ed ne re en ion ra e b reco ping affec ed egmen from he pandemic and capi ali ing on he ir al ork en ironmen o acq ire more c omer .

R R S R A ana i a b crip ion-ba ed b ine i h a h brid ran ac ional ale model ha ell direc l o large corpora ion along i h an a rac i e elf- er ice componen , all le eraged b maller o medi m i ed b ine e . I offer i ba ic fea re for free b a more er and a k are added on o i orkflo pla form, er in he SMB egmen become ickier and more likel o pgrade o he premi m er ion. Thi i reflec ed b A ana 115% re en e re en ion and i e pec ed o f r her impro e a mall o medi m i ed b ine e egmen reco er from he pandemic i h addi ional go ernmen im l .

H G &M P O A he projec managemen of are ind r i projec ed o gro a a CAGR of 13% from $2.35B in 2020 o $4.72B b 2026, A ana i po i ioned o benefi from he increa ed digi al en erpri e pending. I ill be able o gro i c omer ba e and re en e a a m ch fa er ra e han e abli hed firm like A la ian ha ha e o foc more on margin a i re en e abili e. Addi ionall , he ind r i rela i el fragmen ed i h lo marke pene ra ion, allo ing A ana o increa e calabili and i marke hare ell be ond he c rren 3%. A ana al o a ignifican e po re o foreign marke i h 42% of re en e o ide of he U.S. L I V W While he re rn o office i imminen , he la ing impac of fle ible orking en ironmen i likel o remain in ome capaci along i h he pain poin of ork coordina ion, e peciall in an online en ironmen . A a re l , A ana ha he oppor ni o cap re ne fo nd demand and re ain he e acco n hro gh i ick prod c and pricing model e en po -pandemic.

Cornell Eq i

Re earch Repor

4/06/2021 A ana (ASAN) Anal

V

R

F

:S e en Dong

I

P

P H C E : A po en ial hrea o A ana i i inabili o impro e pon a commodi i ed prod c in order o differen ia e i elf from compe i or . Ha ing good UI/UX de ign i he bare minim m acro all projec managemen of are, o A ana m be able o con in o l in e in R&D o crea e inno a i e fea re ha mee he rapidl changing need i hin he ind r in order o main ain he con in ed gro h of c omer con er ion ra e [from free o paid prod c ]. Thi i e peciall concerning gi en ha he ork managemen of are b-ind r i highl fragmen ed and compe i i e i h no onl p repla p blic and pri a e firm b al o mega-cap pla er like Micro of . Hence, hile A ana i e periencing rong re en e gro h, he opera ing margin and profi abili of A ana con in e o be nega i e.

C COVID-19: While he rec rring b crip ion model ha in la ed do n ide from A ana en erpri e acco n , he re en ion and con er ion ra e of he elf- er ice egmen ha ffered a mall- o medi m- i ed b ine e are more rel c an o pgrade from he free, ba ic er ion o he premi m prod c .

In addi ion, o her impac incl de longer en erpri e acco n ale c cle and do n ard pricing pre re on c rren and e i ing con rac a c omer nego ia e for more fa orable erm gi en opera ing condi ion .

S : A ana, Smar hee , A la ian In e or Rela ion

Fool.com Capi al IQ B

ine

Wire Yahoo Finance SEC.go

Cornell Equity Research Report | 04/19/2021 | GameStop Corp. (GME) Analyst: Nandan Aggarwal

Ratings: Sell Company Update

Current Price: $164.91

• • • • • •

Investment Thesis

Market Cap: $10.833 B Revenue: $5.09 B EBITDA: $-168.6M P/E: N/A 52 Week – High: $483.00 52 Week – Low: $3.77

• 1/11 - Alan Attal, Ryan Cohen and Jim Grube join the board, all former executives at Chewy Inc. • 4/19 - Announced that George Sherman will be stepping down as CEO on July 31, 2021, or earlier upon the appointment of a successor.

Competitor Statistics from Q1 2020

Revenue: $1.02 B Stores (US): 3,526

Revenue: $123.9 B Stores (US): 4,756

Revenue: $8.56 B Stores (US): 1,240

One-year Target Price: $25.00

GameStop Corp. (GME)

GameStop Corp. is the world’s largest video game retailer, founded in 1984. They are a Fortune 500 company headquartered in Grapevine, Texas, and were formerly known as Babbage’s until 1999. They currently operate across ten countries and run a powerful e-Commerce platform.

The company provides video games in both physical and digital forms as well as gaming consoles and merchandise.

GameStop has consistently been the leading seller of in-store video game sales in the United States. Walmart and BestBuy followed them in 2020.

Recently, GameStop has faced a decline in their digital video game market share as they ranked third behind Amazon and Sony’s PlayStation Store in 2020. GameStop separates themselves from other vendors due to their unique buy-sell-trade program. Customers can trade in previously used video games, consoles, or accessories for cash or in-store credit. Video games typically have a lifespan of a few years, and consoles have roughly six years, making the sell-trade program attractive to many customers.

Since GameStop’s listing in the New York Stock Exchange on Feb 12, 2002, at $18.00, the stock never saw tremendous growth until this year.

The stock price currently sits at over $160 due to the massive, short squeeze rally in the early months of 2021. Shares of GME stock surged 1,600% in January, fueled almost entirely by Reddit message board r/wallstreetbets and individual investor Keith Gill, bullish about GameStop as early as July 2020. The sharp increase in stock price was further powered by Tesla CEO, Elon Musk, tweeting the phrase ‘Gamestonk!’ to his 44 million+ followers and linking the Reddit forum.

Overview: Currently, GameStop faces an uphill battle due to the significant shift towards digital video games and online sales. During the fourth quarter of 2020, the company reported a 5.5% higher profit of $1.34 a share, which missed forecasts by nearly 6%. In the same quarter, revenue dropped 3%.

In 2016, GameStop was operating over 7,000 stores, but now this number lies below 5,000. GameStop’s top-line saw some growth due to the release of new consoles from Microsoft and Sony, the Xbox Series X/S, and PS5, but these products have low-profit margins.

I recommend selling GME due to the highly volatile nature of the stock and the fact that it is no longer an attractive short, with many analysts already selling off their positions. CNN business’s one-year price forecast median has the stock at a dismal $25.00.

Cornell Equity Research Report | 04/19/2021 | GameStop Corp. (GME) Analyst: Nandan Aggarwal

Visual Financial Information GameStop, Walmart, BestBuy, Amazon stock price YTD

Source: Yahoo Finance Risk Potential Digital Model: Ryan Cohen, future chairman of GameStop, envisions a future for GameStop in the digital marketplace for video games and subscriptions. Unfortunately, players like Sony, Microsoft, and Steam have established themselves and are already years ahead in their software development and execution. Amazon has also recently begun selling video games digitally through their website and has the power to price competitively.

COVID-19: Due to the pandemic, which began in March 2020, GameStop closed all locations in the U.S. and therefore saw a 17% decrease in-store sales but a 519% spike in e-commerce sales. This sharp fluctuation may make it difficult to recover their in-store sales and, in turn making physical locations less valuable.

Board of Directors: The GameStop board saw a significant refreshment when three of the top executives (Alan Attal, Ryan Cohen and Jim Grube) from Chewy Inc., a highly successful online retailer of pet supplies, joined the board and made substantial investments in the company. This new leadership, which does not have experience in the video game market, may require an adjustment period before making constructive changes to GameStop.

Sources: GameStop Investor Relations | Statista | Investors.com | ABC News | fool.com | Yahoo Finance | CNN Finance Walmart Investor Relations | BestBuy Investor Relations | Bloomberg | reddit.com | Capital IQ | CNBC News

Cornell Equit Research Report A

Ratings: H d C a U da e Oracle E pands Government Cloud with National Securit Regions for US Intelligence Communit Oracle Speeds Cloud Migration with New Oracle Cloud Lift Services Google will no longer use Oracle services due to conflict over Supreme Court case over cop right

C

e

Sa

c

from 2020

8 2021 Oracle Inc. (ORCL)

Current Price: $75.35

One- ear Target Price: $80.23

O ac e I c. (ORCL)

Since Oracle s inception, the compan has been a creative leader in the technolog space, creating a plethora of programming s stems, databases, and advancements in business computing. Toda , the compan is focused on repositioning itself as a cloud competitor as well as advancing in AI and ML. As of April 8 th, Oracle (ORCL) is trading at $75.35. I believe that this equit is slightl undervalued and e pected to increase to $80.23 within this ear. I arrived at this conclusion b conducting a comparable companies anal sis with a 4% growth, 10% operating margin, and a WACC of 3.19% across 5 ears. I used these assumptions based on historical data and an optimistic view given Oracle s performance histor .

M hold recommendation reflects a belief that Oracle will continue to perform well as it pivots to the rapidl growing cloud computing industr , but will likel face headwinds from more established competitors like Ama on and Microsoft.

Revenue: $39.07 B

C d: With global data volume e pected to triple over the ne t 4 ears, and big data driving growth in business, cloud computing is becoming an essential feature for businesses. Oracle s current B2B relationships provide it with a foothold in man clients relationships and it has been seeking to add its cloud products to their software.

Revenue: $73.6 B

Despite this, Oracle onl possesses 3 percent share of the cloud market as AWS and Microsoft A ure dominate the market with first-mover advantages and better developed technolog .

Revenue: $143.02 B

O e e : In 2020, Oracle saw total assets increase from $10,135 million to $12,830 million and total liabilities increase from $12.5 billion to $23.2 billion, reflecting the recent growth at the hands of the COVID pandemic. Oracle reported 33 percent growth in its Fusion ERP service and 21 percent growth in Netsuite, its 2 cloud services.

Oracle is forecasting rapid EPS growth from $0.86 in Q1 to $1.30 in Q4, reflecting their optimism regarding the growing econom , but potentiall providing a downside risk to investors if e pectations are not met.

Cornell Equit Research Report A

V

a F a ca I f

8 2021 Oracle Inc. (ORCL)

a

Oracle breakdown of revenue b business division 2009-2020

S

ce: Statista

R

P e

a

C be ec : With the incidence of c ber attacks increasing in the United States, geopolitics and internet technolog have become intertwined. As such, there are threats of government regulation and growth cutoffs which ma lead to less international e pansion for Oracle.

I d S f : There are a plethora of new startups and technologies surrounding the rapid growth of the cloud industr , which could potentiall threaten legac leaders like Oracle and IBM. Ma a e e C a e : Larr Ellison is the founder of Oracle and a vision leader within the tech industr . If Oracle were to lose him, as he is above retirement age, there could be a lack of leadership and vision within the compan .

C a ec c a d ec ca e e : Increased privac and securit concerns surrounding the increased use of cloud computing subject Oracle to possible increased regulator concerns along with other big technolog companies. Additionall , Oracle is at risk from general fluctuations in market and business conditions, demand for cloud enterprise, and governmental budgetar constraints.

S ce : Oracle Investor Relations WSJ Investors.com Capital IQ The Economic Times Yahoo Finance

Cornell Equity Research Sector Report | Spring 2021 | Consumer Discretionary

Consumer Discretionary Sector Report Industry Trends The consumer discretionary sector comprises companies that sell goods or services that are considered non-essential, including manufacturing segments, such as automotive and textiles, and services segments, such as hospitality facilities and media production services. Most businesses in the sector have reached maturity in their business cycle.

With our team’s analysis of four consumer discretionary companies: Hasbro, Mattel, MGM Resorts, and the TJX companies, we expect the sector to continue to outperform the market post-pandemic. The sector report will focus on the sector’s growth momentum and industry trends.

As the consumer discretionary sector’s products and services are highly relevant to consumer’s daily non-essential spending, the sector encompasses those industries that tend to be the most sensitive to economic cycles. However, in the past 10 year, the consumer discretionary sector has outperformed the market and has been widening the gap.

From the end of April 2011 to the end of April of 2021, the consumer dictionary sector returned 361.25% versus the 215.29% return of the broader S&P 500. In addition, the performance gap between S&P Consumer Discretionary and the overall S&P 500 has been consistently increasing in the past 10-years, showing an accelerated sector growth.

Another notable reflection of the sector’s strong performance was the pandemic impact. Both the market performance and the sector’s performance tumbled significantly in March 2020 as coronavirus imposed the first round of lockdown globally. However, as businesses and consumers adjust to the pandemic impact, the sector quickly recovered and was back to pre-pandemic level in June 2020. Since then, the consumer discretionary sector has been at an accelerating rate as the gap between the sector’s performance and market performance is visibly widening until today. Given the strong historical record and growth momentum, we recommend overweight the consumer discretionary for the economic expansion as we approach a full recovery from the pandemic.

Industry Outlook As the consumer discretionary sector is highly reliant on consumer needs and confidence, a shift in the overall demographic would guide sector development. The major demographic trend in the United States is driven by an increasingly heterogeneous population. On one hand, the population in the United States is aging. One the other hand, the millennial population also increased rapidly as the country attracted more young immigrants which helped further expand its ranks. The younger generation tends to be more tech-savvy and has different demands and preferences than the older generation. Therefore, companies need to develop marketing strategies that allow them to more effectively identify and target their primary consumer base and cater their product offerings to suit the demand of the heterogeneous population to sustain a competitive position in the market. The sector overall has a competitive advantage as it provides a broad range of products and services offerings that capture the needs of different age groups.

The Covid-19 pandemic has accelerated the sector’s adaptation to technological advancements. E-commerce has helped many consumer discretionary companies survive and even profit during the global lockdown period. In addition, technologies help companies better target their customer demographics and implement more effective promotional strategies through social media or other digital advertising channels. As ecommerce penetration continues to increase, products will be more accessible, motivating more sales with unparalleled convenience and diversity. Overall, we believe that the pandemic served as a catalyst to drive the sector’s investment in technology and marketing research to better understand the diversifying consumer base.

Cornell Equit Research Report 5/14/2021 Hasbro (HAS) Anal st:Le i Ding Ratings: B

C

a

Current Price: $96.54

U da e

Ha b

I c. (HAS)

Ha b is a global to and entertainment compan pioneering in famil leisure and children entertainment products and services. Some of the compan s most recogni ed brands include Transformers, M Little Pon , and Monopol . Hasbro sho s favorable long-term prospects as it has a strong content line-up and digital-focused orientation.

Market Cap: $13.1 B Revenue: $5.47 B EBITDA Margin: 18% P/E: 58.9 52-Week High: 61.30 52-Week Lo : 98.53 C e Sa c FY 2020

Ma e , I c.

Revenue: $4.58 B EBITDA Margin: 13%

E ec ic A , I c.

Revenue: $5.67 B EBITDA Margin: 25%

Wa Di e C a Revenue: $65.39 B EBITDA Margin: 11%

As of April 1, Hasbro (HAS) is trading at $95.46. M anal sis suggests tha e pected to increase to $115.65 ithin t elve months, indicating an upsid from a Public Comparable anal sis ith five industr competitors, as ell a annual gro th rate, 37% operating margin, and a WACC of 6.10% across established on Hasbro s historical ear performance and an optimistic vie and gro th momentum.

This report makes a BUY recommendation and focuses on factors driving the compan s gro th potential, including a strong brand strateg and content line-up and its acquisition of eOne. S ba d a dc e eHasbro possesses an industr -leading brand portfolio, capturing a ide range of user demographics, especiall suitable for families. The portfolio is ell-diversified to serve different market preferences. The profitabilit of the compan s portfolio is further enhanced b their multiplatform stor -led content strateg , hich effectivel leverages the po er of the brand stories across its traditional to , digital gaming, and visual media segments. The multiplatform strateg allo s sales in one segment to help drive the revenue of another.

Its strong content line-up is also Hasbro s ke competitive advantage over its peers. The compan currentl has 200 projects around 30 Hasbro intellectual properties. Hasbro signed a five- ear agreement ith Paramount, and it has a long-standing association ith Disne . These licensed partnerships help Hasbro maintain its competitive position in the market and stabili es long-term profitabilit .

Ac eO e P d a a Hasbro completed the acquisition of Entertainment One (eOne) for $4.6 billions in 2019, hich not onl helped the compan gro its brand a areness, but also led to long-term revenue potentials and cost savings. This acquisition provides additional revenue streams for the compan and accelerates Hasbro s corporate plan of pivoting into the digital space. The addition of eOne also helped further e pand the brand portfolio ith TV and film content as ell as several brands that are e tremel popular in the children s market, such as Peppa Pig. As an indication of success, during the pandemic, Hasbro as ranked No.1 in kids' content on YouTube. Overall, this integration ill allo the compan to gro the shared customer base for its to s and games hile capturing more profits from content distribution, effectivel enhancing the multiplatform strateg .

Cornell Equit Research Report 5/14/2021 Hasbro (HAS) Anal st:Le i Ding

V

a F a ca I

S

ce: Ha b

R

P e

a

10k Filing

a

H ce c ce a : A significant portion of Hasbro s revenue comes from its Partnership Brands portfolio. Five out of the compan s eight partner brands are from a single partner, Disne . Therefore, a major operation risk lies in Hasbro s capabilit to rene certain long-term output licensing agreements for access to partner brands. As these third-part partner brands are also some of most popular names that drives market differentiation and competitive advantage for Hasbro, a termination of an partnership ould negativel impact the compan s long-term revenue.

This can be mitigated b increasing the number of franchise brands in the compan s portfolio. While partnership brands provide favorable brand a areness and profitabilit , the compan s main revenue and gro th driver is still its o n flagship franchise brands hich could help offset the partnership uncertainties.

Ra d c e e e : As a result of Hasbro s reno ned stor -led brand strateg , the compan s brands, products, and content are often associated ith background stories and emotional connection ith the customers. Ho ever, consumer interests and market preferences in the to and entertainment industr is ever evolving. Therefore, Hasbro ould need to better predict industr trends and consistentl deliver ne brands in a timel and cost-effective manner. If the compan s ne product fails to appeal to consumer, the revenue and profits ill be harmed, and the compan has the bear the costs as production is irreversible. This can be mitigated b more investment into market research including a market acceptance testing period for each ne product developed.

O e - e a ce e ea a ac : All Hasbro s products are manufactured b third-part manufacturers, ith the majorit in China. The compan s over-reliance on oversea production e poses itself to a number of macro risks, including the trading relationship tension bet een the U.S. and China, imposition of tariffs, and foreign e change risk. In order to mitigate this risk, the compan has been reducing its reliance on China b moving certain product facilities to India, Vietnam, and Me ico.

S ce : Hasbro Investor Relations CFRA Equit Research fool.com Seekingalpha.com SEC.gov Capital IQ

Cornell Equit Research Report A

6 2021 The TJX Companies, Inc. (NYSE:TJX) Anal st:Sarah Bo le

Ratings: BUY

Current Price: $69.24

C

T e TJX C

a

U da e

Market Cap: 83.501 (B) USD Re enue: 68497 million USD EBITDA: 1.153 million USD P/E: 989.14 (TTM) 52- eek range: $42.52-$71.06

C

e

Sa

c

from Q1 2020

52- eek range: $4.32-$53.90 1 ear estimate: $27.42 Current price: $24.54

52- eek range: $15.04-$64.16 1 ear estimate: $62.00 Current price: $59.25

52- eek range: $8.08-$67.91 1 ear estimate: $68.30 Current price: $66.78

One- ear Target Price: $71.24

a e , I c. (NYSE: TJX)

O er the past ear, the TJX Companies, Inc. has eathered the storm of COVID and has seen gro th in its US HomeGoods stores, ith re enue up 13% o er FY2021. With these strong earnings in home furnishings, e pansion plans, and the findings of a comparable compan anal sis, The TJX Companies, Inc. stock is currentl under alued and trul is orth up ards of $71.42.

HomeGoods, an off-price retail subsidiar focused in home furnishings, in the United States is a segment of the business that continues to return high ields for the conglomerate. When comparing the Q4 of FY2020 and FY2021, net sales for US HomeGoods increased b $300 million hich signifies ho lo al the ke customer segment of The TJX Companies.

E en through economic uncertaint and the historical consumer trend of less disposable income being spent on consumer discretionar assets, TJX and specificall HomeGoods thri ed.

This success ill continue into the future as US HomeGoods locations continue to e pand faster than other subsidiar . O er the past fiscal ear, TJX opened 12 ne locations and e panded HomeGoods gross store square feet from 18.8 million to 19.1 million. E en ith this rapid e pansion, TJX Companies has a oided incurring massi e in entor b streamlining store suppl s stems and focusing on regional trends. At the end of Januar 2021, TJX s total in entor totaled $4.3 billion hich as $600 million less than that of a ear ago. TJX Companies focus on consumer trends and routing e pansion in subsidiaries that are thri ing ill make the corporation a ke pla er in the consumer discretionar sector for the future.

The compan s financials underscore ho successful its recent strategic positioning has been and ho strong it is relati e to other companies in its sphere of off-price retail. Behind onl Target, hich is arguabl in a broader industr than TJX that targets different clientele, TJX Companies, Inc. has the higher forecasted re enue for the ne t t o fiscal ears at $32.7 billion and $33.3 billion respecti el . On a final note, a forecast of the compan s EV/Re enue for the 2021 and 2022 Fiscal Years has a median implied per share price of $71.42 hich reflects the strong foundation the compan has.

M bu recommendation reflects a belief that The TJX Companies, Inc. ill continue to perform ell, gi en the strength and financial focus on HomeGoods, as ell as the gro th of the retail industr post-COVID restrictions.

Cornell Equit Research Report A

6 2021 The TJX Companies, Inc. (NYSE:TJX) Anal st:Sarah Bo le

V a F a ca I f a The TJX Companies, Inc. s. Bed, Bath & Be ond Stock Prices

S

ce: Ya

R

P e

F a ce a

O e Ma e P e e ce: TJX Companies, Inc. s subsidiaries ha e al a s been recogni ed for its unique in-store treasure hunt e periences hich has hindered its online presence. As recentl as last eek, Ama on announced it is opening an online off-price home furnishing marketplace that ill be in direct competition ith HomeGoods.

While that ma fragment the market share, consumer trends sho that people are e cited to re-enter stores and e perience the thrill of a HomeGoods o er the ne t fe ears.

S ce : The TJX Companies, Inc. In estor Relations Capital IQ Bed, Bath & Be ond In estor Relations Yahoo Finance Bloomberg SEC.go

C

E

4/8/2021 M

I

(MA ) A

:B

C

a

C

U da e

: $19.99

O

:D

N

-

: $22.04

Ma e I c (MAT)

, B

.

M

I .

, .

C M C : $6.96B EBI DA: $604.5 /E: 55.53 52 : $21.87 52 : $ 7.54

,M

I .

A

A

8, 2021, M

(MA )

$19.99. I $22.04 DCF .I

.I

C

e

Sa

M .

c

2020

M

-M , .

E-c

e ce: ,M .

N

I

: $4.58B : $0.126B

, .

B

,M .

P M

ec : ,

N

I

: $5.465B : $0.223B

A . ,

2010 . .

O e e : I $4.583

N

I

: $60.76B : -$4.954B

B F

G

3 $126.6 O $1.355B,

,M , . , 2020.

$4.505 -$213.5

,

2019 $1.276B

.

C

E

4/8/2021 M

I

(MA ) A

V

a F a ca I

M

,H

S

ce: Ya

R

P e

C

D

F a ce a

d-19:

,M .H

, .

M

.

R a :M

, 2020. M

S ae

M

:O

.H

M

,M .M ,

.H

.

D

C

,

,

.

S ce : -M I

J D

C

H

,

,H . e

N

C

,

C a

:D

a

B

F .

.

EC.

F C

I

H F

I

M

Cornell Eq i

Research Repor

A

15

2021 MGM Resor s (MGM) Anal s :JP Spak

Ra ings: B C

a

C rren Price: $39.75 U da

MGM R

The hospi ali ind s r s ffered major re en e losses d e o he COVID-19 pandemic. The firs s age sa massi e na ional lockdo ns, hereb pre en ing he arge marke of ra elers from s a ing in ho els. E en af er lockdo ns ere lif ed, man indi id als fel ncomfor able i h ra el, leading o a con in a ion of his rend.

The COVID-19 pandemic has also drama icall increased he iabili of ork-from-home (WFH) orkspaces, hereb decreasing pre io s needs o ra el for b siness.

On March 11, 2021, MGM anno nced a par nership i h B ffalo Wild Wings ha la nched an e cl si e spor s be ing e perience.

On Jan ar 4, 2021, MGM la nched mobile be ing in he s a e of Io a hro gh i s BETMGM.

C

Sa

c

from LTM (as of 3/16/21)

Re en e: $9.042 billion Ne Income: $1.924 billion P/E Ra io: 10.25

One- ear arge price: $50.00

(MGM)

MGM Resor s has been p blicl raded for nearl 25 ears, b i as onl recen l ha heir s ock price began o sk rocke . O er he las ear he compan s s ock price has increased ro ghl 150%.

As of April 15 h, MGM Resor s (MGM) is rading a $39.75. I belie e ha his eq i is nder al ed and e pec ed o increase o $50.00 i hin his ear. I arri ed a his concl sion b cond c ing a Comps anal sis be een MGM and some of heir main compe i ors. Of all compe i ors anal ed (Caesars En er ainmen , Las Vegas Sands, W nn Resor s, and Marrio In erna ional), MGM as he onl one o record a posi i e Ne Income i hin he las 12 mon hs (as of 3/16/2021). Addi ionall , MGM s P/E Ra io a ha da e s ood a a heal h 10.25, indica ing a lo probabili ha he compan is o er al ed.

M b recommenda ion reflec s a belief ha MGM ill con in e o perform ell, gi en he general easing of res ric ions aro nd he orld and MGM s pro en abili o manage i s cash incredibl efficien l .

H a a dB : The hospi ali ind s r speciali es in ca ering o cons mers on aca ion or o her rips from home hro gh o ernigh en res. Mos ho els fall in o his ca egor , and man differen big brand names ha e made heir for nes here.

While MGM Resor s falls in o his ca egor , i also speciali es in i s be ing ser ices hro gh casinos and more recen l easil accessible spor s be ing hro gh i s BETMGM. Casinos and o her be ing ser ices m s also ca er o cons mers in real ime, so he make p a more specific s bse of he hospi ali ind s r .

O : MGM Resor s is o spokenl commi ed o i s Foc sed on Wha Ma ers: Embracing H mani and Pro ec ing he Plane philosoph , signif ing o he p blic i s concen ra ion on prac icing corpora e social responsibili . Nei her Caesars En er ainmen nor Marrio In erna ional has a al e or program ha o ld direc l appeal o he gro ing concern of he o nger genera ions on s s ainable b siness prac ices.

As his genera ion begins o comprise more of he ra el marke , companies like MGM i h s ch o spoken prac ices ill hold an ad an age o er compe i ors i ho s ch plans.

When s r e ing he financials from he las ear, i is clear ha MGM has al erna i e so rces of re en e and he fle ibili o re-alloca e cos s in imes of hardship. J aposed o i s larges compe i ors, MGM has a clear compe i i e ad an age in his regard.

Re en e: $3.474 billion Ne Income: $ (1.757) billion P/E Ra io: -11.36

Cornell Eq i

Research Repor

A

15

2021 MGM Resor s (MGM) Anal s :JP Spak

V

a F a ca I

a

MGM Share Price in he Las Year

S R

ce: Na da P a

Sa a C S : Wi h he pandemic seemingl inding do n, man people o ld ass me ha o ld en ail a re i al in he ra el ind s r . Ho e er, i h do b s s rro nding he accina ion effor s s emming from nega i e press co erage of he Johnson & Johnson and As raZeneca accines, man ra elers ma no feel safe in lea ing heir homes for aca ion a his poin in ime. Addi ionall , despi e he US s s ccess in adminis ering COVID accines, man o her pop lar ra el des ina ions are m ch far her a a from accina ing heir pop la ions. Man o her co n ries are also in ano her phase of lockdo ns, hich o ld impac c s omers abili o ra el.

B d Ad a Ta I c a : Presiden Joe Biden has s rongl affirmed his in en ion o raise he corpora e a ra e from 21% o 28%, and Treas r Secre ar Jane Yellen is in he process of raising in erna ional a ra es for domes ic corpora ions ha mo e opera ions abroad. This co ld ha e a direc effec on MGM s financials, as i o ld remo e loopholes o re ain re en e and decrease Ne Income i h he increased propor ion of a es.

F I Ga b : Spor s Be ing ook off d ring he pandemic as indi id als s ck a home sei ed an possible chance o become in ol ed i h he happenings of he orld. When he Korean Baseball Leag e as he firs major spor s leag e o re rn o ac ion, large gro es of spor s-h ngr Americans ook in eres and placed be s on eams he had ne er before heard of. As prac ices begin o re rn o pre-pandemic le els, ho e er, his in eres ma demons ra e i self o be onl a emporar fad, and here is a po en ial risk (albei sligh ) ha his sen imen e pands o gambling in general.

S c : MGM In es or Rela ions Yahoo Finance A om Finance Nasdaq The Financial Times The Wall S ree Jo rnal Caesars En er ainmen In es or Rela ions Marrio In erna ional In es or Rela ions

Cornell Equity Research Sector Report | Spring 2021 | Telecommunications

Telecommunications Sector Report Industry Trends Like the rest of the market, the telecommunications sector was significantly impacted by the COVID-19 pandemic. When employees were forced to work from home, the transition to digital work created unanticipated surges in network traffic, up by 800% in some instances. Therefore, telecom companies were met with unique challenges created by this unprecedented situation. Firms had to ensure 24/7 network connectivity for more consumers than ever before, maintain stable cloud computing, and combat urgent security threats and vulnerabilities. But even with these new challenges, firms like T-Mobile, Comcast, and Vodafone still found room for growth. Communications companies were able to increase their network bandwidths, continue the rollout of their 5G networks, and tailor their services to different customer segments using artificial intelligence and machine learning. With these changes and a renewed importance of the telecom industry, it was no surprise that growth in the communications space outpaced growth in the S&P 500 by 12%.

In addition to these market forces, the government has also played a significant role in shaping the industry’s outlook. Early in the pandemic, the Federal Communications Commission launched their Keep Americans Connected initiative, which prohibited internet service providers from terminating internet privileges to customers who were unable to pay due to pandemic related issues. While the effects of this pledge are still uncertain, it is reasonable to expect that ISPs experienced losses from consumers who continued to use their services without paying. Looking ahead, President Biden’s new infrastructure plan should significantly impact the sector. In his new plan, a $100 billion investment in internet infrastructure would be used to deploy broadband networks to rural America. In addition, the plan calls for policy changes to reduce the price of high-speed internet. So as vaccination efforts continue to impress and the pandemic looks to be on the way out, the success of the President’s infrastructure plan on improving network connectivity and reducing internet prices will be a primary driver or mitigant of industry growth and will be something we look forward to analyzing moving forward.

Industry Outlook Within the next decade, the telecommunications(telecom) industry will be fully integrated into the next generation of mobile networks, 5G. 5G promises lower latency, faster speeds, and greater load capacity, delivering browsing speeds 10 to 20 times faster than the 4G network. When combined with advances in artificial intelligence, augmented and virtual reality, and location-based services, 5G has the potential to redefine entertainment and accelerate remixing. Further, while the cable TV bundle’s demise has been in motion for years, 5G could certainly accelerate it. Lightning-fast speeds will be delivered over wireless instead of T1, DSL, or cable, which means rural areas will now have access to high-speed internet that they could not access via a wired connection. Telecom companies may have to repackage the way they sell internet services to users, with the onset of this new technology. 5G technology is also important to the Internet of Things(IoT) because of the need for a faster network with higher capacity that can serve connectivity needs. 5G enabled IoT would help support 22 million jobs around the world as industries benefit from the ultra-fast, high-capacity data transmissions to the time sensitive nature of their output.

Telecom providers must explore the development of services that require greater collaboration with thirdparty partners to deliver end-to-end enterprise applications, which is exactly the interconnectedness 5G would allow for. Overall, the telecom industry should determine how they can leverage these new technologies to create new products, services, and business models that drive revenue growth

Cornell Equit Research Report A

6 2021 T-Mobile Inc. (NASDAQGS: TMUS) Anal st:John Hanna

Ratings: H C

a

Current Price: $131.26 U

a

Recent FCC auction led to $9.3 billion in spending, far lo er than competitors AT&T and Veri on ho had far fe er valuable C-band spectrum for 5G Recent merger ith Sprint, completed in April 2020, has led to $1.9 billion in integration costs, and bet een $2.5-3 billion further costs forecast in 2021 ith onl 25% of Sprint customers on TMUS net ork Market Cap: 161,440 (mm) USD Revenue: 68497 million USD EBITDA: 23571 million USD P/E: 55.03 52- eek range: $85.81-$135.52

T-M b

I

One- ear Target Price: $127.89

. (NASDAQGS: TMUS)

With the advent of COVID-19 vaccines and the recover of the US Econom , e are entering a middle-stage of the business c cle. In this stage, e should e pect stable gro th in CapE spending b companies, as ell as broader consumer spending. T-Mobile should be a beneficiar of these secular trends as businesses and consumers invest in 5G. This has been reflected in TMUS share price. As of April 6th , T-Mobile (TMUS) is trading at $131.26. We believe this equit is accuratel valued and am setting a Price Target of $133.15 based on a s nthesis of a DCF model and relative market Comps anal sis. I arrived at this conclusion b conducting a DCF anal sis ith a 4% gro th, 10% operating margin, and a WACC of 3.19% across 5 ears.

M hold recommendation reflects a belief that T-Mobile ill continue to perform ell, given the rising popularit of 5G and the s nergies bet een the recent merger but that this is currentl reflected in the froth valuation, as ell as the arrival at a potential telecom industr carr ing capacit here T-Mobile has alread attained its fastest gro th.

5G: T-Mobile undoubtedl is in the best 5G position of the Big 3 , ith its valuable mid-Band spectrum, combined ith lo -band to create a la er-cake meaning that customers have access to 5G across geographies and devices. Within the ne t 6 ears, T-Mobile e pects to increase their capacit 14 to cover 99% of Americans ith 5G. Ho ever, ith the recent FCC auction, competitors have been investing and catching up to T-Mobile s lead. Furthermore, 5G rollout and full application is e pected to take bet een 5-10 ears and the market ma be overestimating T-Mobile s potential to generate cash flo at that point.

O : In 2020, T-Mobile sa total assets increase from $86.9 billion to $187.2 billion and total liabilities increase from $12.5 billion to $23.2 billion, reflecting the recent merger bet een T-Mobile and Sprint, the 3rd and 4th largest mobile net orks. T-Mobile also reported a 0.8% postpaid churn rate that sho s strong customer lo alt , the lo est of the big 3.

T-Mobile has seen the highest subscriber gro th of the big 3 in 2020, including 824,000 in Q4, demonstrating the desire for their products, especiall ith their record breaking iPhone 12 sales.

Cornell Equit Research Report A

6 2021 T-Mobile Inc. (NASDAQGS: TMUS) Anal st:John Hanna

V

a F a

a I

a

T-Mobile vs Telecom Sector vs SPX

Source: CapitalIQ R

P

a

C b : T-Mobile as a part of international firm Deutsche Telekom is uniquel at-risk of c ber breaches and attacks due to the international value it possesses. An attack could lead to a decline in consumer confidence in the compan , and have a material impact on subscriptions, and in turn, revenue. As arfare shifts to the realm of computers, companies like T-Mobile ill need to make larger investments in 5G, potentiall straining their balance sheet.

Ma R : While the US econom is currentl in a gro th-oriented stage, if interest rates are increased too rapidl b the Federal Reserve, or if the current ever thing bubble deteriorates, disposable income ould rapidl decline, leading to reduced phone sales and spending on ireless services. T-Mobile is faced doubl in this risk due to its froth valuation, generating further share price do nside if a market bubble ere to cease.

A C : Although the Department of Justice has approved the merger of T-Mobile and Sprint, there is increased antitrust backlash against larger companies. The DOJ and FCC have launched several investigations into the large tech companies in 2020. This ma hinder future gro th through mergers and acquisitions for the telecommunications industr . Additionall , the Biden administration has signaled stronger intentions to enforce regulation regarding antitrust, and telecommunications could be a primar target.

S : T-Mobile Investor Relations Deloitte AT&T Investor Relations Veri on Investor Relations Bloomberg SEC.gov Capital IQ Financial Times

Cornell Eq i

Research Repor

4/8/21 Veri on Comm nica ions (VZ) Anal s :Jack Rebillard

Ra ings: B

C

C rren Price: $57.60 U

$34.6B Q4 2020 re en e ( p 10.3% from Q3) $17.8B ne income (-7.6% YOY) $238.4B marke capi ali a ion $31.4B LTM EBIT $61.95 52- k high $52.85 52- k lo 1.03% ch rn ra e Added 161 MH of C-band na ion ide in $53 billion FCC a c ion ic or Signed i s firs E ropean 5G deal i h Associa ed Bri ish Por s Recalled 2.5 million ho spo de ices d e o fire ha ards

C S from Q4 2020

Re en e: $20.3B 2020 Ne Income: $3.1B Ch rn: 0.90%

Re en e: $27.B 2020 Ne Income: $10.5 B Ch rn: 5.90%

V

C

One- ear Targe Price: $67.56

(V )

Veri on s ock has gro n o er 11% since i s pandemic lo poin . This re rn can be a rib ed o o hings: an increase in ne ork raffic from a shif o orking from home and effor s o personali e he c s omer e perience sing machine learning.

Ho e er, Veri on s COVID-19 reco er s ill lagged far behind ha of i s compe i ors since he comm nica ions sec or is p aro nd 75% o er he same period.

As of April 8 h, Veri on (VZ) is rading a $57.60 b I belie e his eq i is nder al ed and can be e pec ed o increase o $67.56 i hin a ear. I arri ed a his price b cond c ing a comps anal sis looking a Veri on's performance compared i h i s compe i ors: T-Mobile, AT&T, Comcas , Al ice, and L men Technologies. A b recommenda ion reflec s m belief ha Veri on ill accelera e i s pandemic reco er , gi en he gro ing impor ance of 5G, he s ccess of he massi e C-band a c ion, and he effor s o di ersif he compan s ser ices.

5G T FCC A : 5G is he fif h genera ion of broadband cell lar ne orks ha deli ers lo er la enc , fas er speeds, and impro ed load capaci . C rren l , Veri on has he hird larges 5G ne ork, co ering 11% of he co n r . Earlier his ear, Veri on ie ed he massi e C-band a c ion as an oppor ni o gro heir 5G ne ork i h a $53B in es men . Wi h he 120% increase in heir s b-6 GH spec r m holdings, he e pec heir 5G ne ork ill gro o co er o er 100 million Americans in j s el e mon hs.

M B B C : E en i h he promising na re of heir 5G rollo , Veri on is looking a addi ional a s o bring b siness o he able. One crea i e sol ion o di ersif i s ser ices is o eam p i h ech gian s like Ama on and Microsof . Wi h hese par nerships, Veri on is disco ering ne a s o se heir 5G echnolog , s ch as connec ing hem i h ad anced drones and robo s. Since a onomo s machines benefi from lo la enc and high hro ghp , and he fac ha 5G massi el impro es hese fea res, Veri on ill be able o le erage heir echnolog o crea e al erna i e re en e s reams. Also, Veri on has a leg p on heir compe i ors b alread de eloping rela ionships i hin he ech ind s r , making hem niq el posi ioned o capi ali e on his ne oppor ni .

O : To comba he nega i e effec s of COVID-19, Veri on q ickl e panded heir band id h capabili ies l ima el decreasing heir c s omer ch rn ra e. B e en i h his reac ion, he ere o performed b ind s r compe i ors. Ye mo ing for ard, he compan s solid fo nda ion is enabling hem o e plore bold s ra egies o e pand heir 5G co erage, capi ali e on echnological de elopmen s, and di ersif heir ne ork of ser ices. Wi h his s ra eg and heir compe i i e ad an ages, Veri on has he po en ial o lead he elecomm nica ions sec or in a pos -COVID orld.

Cornell Eq i

Research Repor

4/8/21 Veri on Comm nica ions (VZ) Anal s :Jack Rebillard

V

F

I

Veri on, AT&T, T-Mobile, and Comcas Gro

S

ce: Ya

R

P

h Since Febr ar 1s , 2020

F a ce

P B I P : While he Presiden s infras r c re plan co ld promo e ind s r gro h hro gh a $100B in es men in in erne infras r c re, here are some inheren risks associa ed i h he idea.

The primar concern is a s gges ed polic change ha o ld red ce in erne prices for all cons mers. The re en es ISPs, s ch as Veri on, collec from selling in erne ser ices picall comprise a significan por ion of he firm s o al re en e. Therefore, an risk o his primar so rce of income also presen s a risk o he financial s abili of he en ire compan .

C A : In an increasingl digi al orld, c ber-a acks pose a grea er hrea o elecomm nica ions companies han e er before. In recen ears, c ber-a acks ha e increased in freq enc and se eri , a rend e can e pec o con in e mo ing for ard. While a ca as rophic a ack has no impac ed he compan e , he inabili for Veri on and clien s o se heir ne orks in he e en of breach o ld likel res l in significan ne pec ed e penses and loss of marke share o ind s r compe i ors. Therefore, significan meas res need o be aken o mi iga e his risk, a meas re ha Veri on has e o ake.

COVID-19: Like all o her companies, Veri on m s make p blic heal h considera ions i h regard o he pandemic. Unfor na el , he pandemic had an ad erse effec on Veri on s opera ing res l s in 2020. Since he compan is based on i s abili o pro ide comm nica ions ser ices and he abili of heir c s omers o pa for hese ser ices, an e en ha nega i el impac s he economic ell-being of cons mers ill also ha e a de rimen al impac on he compan . Therefore, he financial s ccess of Veri on is hea il dependen on he ra e ha he na ional and global comm ni reco ers from he COVID-19 pandemic, some hing he compan has no con rol o er.

S : Deloi e Veri on In es or Rela ions Federal Comm nica ions Commission CNBC.com S&P Capi al IQ Yahoo Finance The Wall S ree Jo rnal S a is a Marke Wa ch Digi al Trends

C

E

04/15/2021 A & ( ) A

:Hold

C

: $29.75

:B

-

-E

: $31.30

AT&T (T)

A & ( ) A .A & , .

,I ,

, ,A &

,

,

,

5G

.A & .A & $29.75, $31.30,

I 5.3%

.I

A &

.

Overview: A &

$153.7 D

2020. .A

A &

$85

M

.I

,A & .C

-M

,A & 2018

2020. M

,A &

.I 0.66

D

2020.

0.97

2011

0.86 0.71 2.63.

C , -M ,

, A &

,I EBI DA $26 ,

A & .A

. ,A & 60 .A & -

.A & 8, 10-12.

EBI DA A &

A & .A & 0.75 25%

500 500.

& &

A & A & HB 41.5

.

HB

M

34.6 2020. HB

M

.F 8.6

A

+ E $40 I M ,A & A & I , A & C-B

, HB

M 2019

,

+. .

5G

.

5G

.

.

5G

C

E

04/15/2021 A & ( ) A

:B

-E

Visual Financial Information -M

,A & ,

S

ce: Ya

(B

5

F a ce

)

E /E

2018

2019

2020

$170.756

$181.193

$171.76

$2.85

$1.89

$-0.75

8.51

18.69

18.74

Risk Potential A

A &

, .F

M

,A &

HB

.

.I ,A & M 5G. A

,

.I $23.6

,A & -

.

A &

Sources: M F

.

A

M

.

A & I

EC.

C

I

I

.

Cornell Eq i

Research

Ra ings: B C

4/8/2021 Comcas Corpora ion (CMCSA)

C rren Price: $54.36 U

Marke Capi ali a ion: 248.87B Re en e: $103.56B EBITDA: $30.83B P/E: 23.84 52 k high: 58.58 52 k lo : 34.16 Capi al e pendi res decreased 4.4%, reflec ing less spending on c s omer premise eq ipmen , par iall offse b increased spending on scalable infras r c re La nched Peacock, a direc o cons mer s reaming ser ice ha fea res NBCUni ersal s con en

C

C

One ear Targe Price: $63.98

(CMCSA)

Comcas Corpora ion s b siness opera ions are separa ed in o he follo ing ca egories: Cable Comm nica ions( nder Xfini ), Cable Ne orks, Broadcas Tele isions, Filmed En er ainmen , Theme Parks, and Sk segmen s.

As of April 7 h, Comcas Corpora ion(CMCSA) is rading a $54.35. I belie e ha his eq i is nder al ed and e pec ed o increase o $63.98 i hin his ear. I arri ed a his concl sion b cond c ing a compara i e anal sis agains AT&T Inc., Ne fli Inc., The Wal Disne Compan , and Veri on Comm nica ion Inc, and selec ing he median m l iple in he implied per share al e range. The median m l iple, or he middle gro nd in his range, acco n s for he gro h Cable Comm nica ions ill see i h he onse of 5G echnolog as ell as he s agnan Broadcas Tele ision and Cable Ne orks sec ors, hich are becoming less pop lar amongs he risk of on-demand s reaming.

M b recommenda ion reflec s a belief ha CMCSA ill con in e o perform ell, gi en he emerging ad anced in erne echnologies ha ill propel demand for ario s ser ices in heir Cable Comm nica ions sec or.

CO ID-19: CMCSA inc rred cos s d e o he fron line personnel req ired o keep cons mers connec ed o ser ices. F r her, he increased economic ncer ain from he pandemic, nega i el impac re en e and increased risk associa ed i h collec ing o s anding recei ables in Cable Comm nica ions.

To comba hese losses, ho e er, CMCSA has implemen ed cos sa ing ini ia i es across heir b sinesses, he mos significan rela ing o he se erance of NBCUni ersal in connec i h he realignmen of he opera ing s r c re in heir ele ision b siness. This s ra eg is indica i e of he compan mo ing a a from i s cable b siness, and p ing more reso rces in o heir comm nica ions ser ices, hich is here he r e gro h po en ial of he compan si s. COVID-19 has increased raffic o and peaked sage of ideo s reaming, gaming, and conferencing, and CMCSA is capi ali ing on he perpe al na re of remo e ork and in erne sage b shif ing asse s a a from radi ional forms of media, like cable.

O : In 2020, Comcas iss ed $18.6B of long- erm deb o repa e is ing deb and increase cash on he balance shee , bols ering liq idi and s reng hening heir financial posi ion. Their re en es o aled $60.1B, an increase from he $58.1B of 2019, as heir o al opera ing cos s and e penses en from $23.3B in 2019 o $25.3B in 2020.

Cornell Eq i

Research

F

4/8/2021 Comcas Corpora ion (CMCSA)

I

S ock Comparison of Ne fli and Comcas

S

ce: T e M

R

P

i h he S&P 500 since 2010

e F

E T A R : Sk , Comcas s E ropean cable ne ork, relies on hird-par elecomm nica ions pro iders o deli er ideo, in erne , and phone ser ices. B , he loss of Sk s ransmission access agreemen s i h sa elli e o elecomm nica ion pro iders in E rope, co ld ad ersel affec Sk s b siness. In rn, Comcas o ld see a drop in c s omers and re en es, if Sk fails o pro ide q ali ser ices in he E ropean region.

E R : Comcas recen l la nched Peacock, a direc o cons mer ele ision s reaming ser ice. Ini ia i es like ha , or acq isi ions he ma make, ma ca se Comcas o inc r significan e penses, disr p rela ions i h c rren and ne emplo ees, or di er he a en ion of managemen from heir c rren opera ions. Comcas is also s bjec o federal reg la or agencies ha co ld impose res ric ions on heir b siness opera ions, f r her s ppressing he con rol Comcas has o er i s ini ia i es.

H C R : Compared o i s compe i ors, Comcas has a higher ch rn ra e and a con in al ser loss problem. Toda , here are large and small compe i ors in he elecomm nica ions space ha makes i easier han e er for c s omer ho are nhapp o s i ch companies. Comcas m s cannibali e he old a s of cable TV, hile adop ing ne a s of s reaming, before heir compe i ors.

S : CMCSA Ann al Repor Form 10-K In es ors.com Yahoo Finance Capi al IQ Fierce Telecom AT&T Repor s Veri on Barrons fool.com Wall S ree Jo rnal Marke Bea Financial Times S a is a ReThinkResearch

Cornell Equit Research Report 04.11.2021 Toronto-Dominion Bank (TD) Anal st:Radhe Mel ani Ratings: Se Current Price: $66.15

C

a

U da e

T

-D

i i

Ba

(TD)

Recommendation: Sell Market Cap: 119.51B P/E Ratio: 12.44 Dividend Yield: 3.83%

Since the Toronto-Dominion Bank (TD) as listed in the Ne York Stock E change on August 30, 1996, the stock has gro n more than 12.75%.

Since then, TD Bank has gro n to be the largest bank in Canada b total assets, retaining over $407 billion in assets.

C

ei

S a i ic

from 2020

As of April 11th, TD Bank is trading at $66.15. I believe that this equit is overvalued and the share should be sold. I arrived at this conclusion b conducting a comparable compan anal sis against Ro al Bank of Canada (RY), Wells Fargo & Compan (WFC), Candian Imperial Bank of Commerce (CM), The Bank of Nova Scotia (BNS), and the Bank of Montreal (BMO). At 12.44 , TD Bank s For ard P/E ratio as on the higher side hen compared to its competitors, and as larger than both the mean and medium.

M sell recommendation reflects a belief that TD Bank ill continue to perform ell, but continue to decrease in popularit due to its lack of competitive rates and refusal to minimi e fees.

Revenue: $3.3B Net income: 11.89B CA$

Revenue: $85.06B Net income: $19.55B

Revenue: $37.52B Net income: $11.4B CA$

Acc : TD Bank has five different t pes of checking accounts providing individuals from a multitude of backgrounds the opportunit to receive benefits and unique features. These checking accounts include TD Convenience Checking, TD Be ond Checking, TD 60 Plus Checking, TD Student Checking, and TD Simple Checking. Additionall , TD Bank offers three saving accounts. These are comprised of TD Simple Saving, TD Gro th Mone Market, and TD Be ond Savings. These offer high APYs so that individuals are incentivi ed to open multiple accounts.

TD Bank s current account rates, especiall ithin its saving accounts, are lo er than the majorit of reno ned bank. This ma be a factor to ards individuals being inclined to save else here.

O e ie : In 2021, TD Bank sa total assets increase b $1,348.731 billion, hich is a 21.77% increase ear-over- ear, and total liabilities increase to $1,274.576 billion, hich is 22.54% increase ear over ear. TD Bank continues to be one of the largest banks in the U.S. ith over 9.5 million customers.

TD Bank recentl announced that it is launching the TD Double Up Credit Card , hich has a 2% cash back re ards program and allo s the credit card holder to earn 1% cash back on purchases and hen re ards are redeemed to the TD deposit account. This development is due to a shift in consumer spending habits in response to COVID-19.

Cornell Equit Research Report 04.11.2021 Toronto-Dominion Bank (TD) Anal st:Radhe Mel ani

TD Bank Sales versus its Competitors Q3 2020 (04.12.2020 - 04.10.2021)

S

ce: C Ma e

Ri

P e ia

(200

300

d )

Acc Fee : When compared ith similar competing banks, TDBank offers higher fees to open and maintain its accounts. These fees include monthl maintenance fees, hich are reportedl an inconvenience to get refunded or aived. Comparabl , most saving and checking accounts have no monthl maintenance fees ithout mandating qualifications. Additionall , overdraft protection, hich is commonl either can be aived or is none istent, is unavoidable.

Acc I e e Ra e : TDBank offers three savings accounts: TD Simple Savings, TD Be ond Savings, and TD Gro th Mone Market. These accounts offer higher APYs, often inciting customers to open several accounts. Ho ever, hen compared to competing banks, the interest rate that TDBank offers is minimal for each account.

C id-19: During COVID-19, TDBank ensured that its customers kne that the ere held in high priorit b continuing their 24/7 human resources contact line. Through this and other resources on their ebsite, the offered their customers services ranging from home lending relief options to assisting PPP loan customers ith the forgiveness process.

S ce : TD Bank Forbes Advisor Google Finance MarketWatch Bloomberg CisMarket Nasdaq Cision ValuePenguin Yahoo Finance O ler SEC.gov Capital IQ Financial Times CNN Business

Cornell Eq it Research Report 04.11.2021 Sq are, Inc (SQ) Anal st:IEd ard Foote Ratings: H

C

C rrent Price: $273.23

U

S

,I

One- ear target price: $260.78

(SQ)

Recommendation: H Target price: $260.78

C

S

from Q4 2020

Gross Pa ment Vol me: $32.02B Re en e: $9.5B

Gross Pa ment Vol me: $277.07B Re en e: $17.7B

Gross Transaction Vol me: $9.1B Re en e: $57.6M

Gross Pa ment Vol me: Re en e: $1.57B

Incorporated in 2015 b T itter CEO Jack Dorse , Sq are is a B2B fintech compan that pro ides POS, marketing and other financial ser ices. The firm co ples affordable hard are ith sophisticated soft are to help sellers process transactions and manage their b sinesses. Sq are is a disr ptor in the transaction processing space and is no e panding into the cr ptoc rrenc market as ell.

As of April 13th, Sq are is trading at $273.23. I belie e that this eq it is reasonabl al ed and that in estors sho ld maintain a ne tral o tlook.

I arri ed at this concl sion b cond cting a comparable compan anal sis against Pa Pal (PYPL), Shopif (SHOP), Lightspeed POS (TSX: LSPD), and Int it (INTU). While Sq are s 13 LTM EV/Re en e m ltiple is the lo est amongst its peers, the firm still trades at premi m ith a 582.9 P/E m ltiple.

M H recommendation reflects a belief that Sq are ill contin e to e pand, b t s ch gro th is alread priced into the eq it gi en its high m ltiples.

C A : Cash App is Sq are s mobile pa ment application and allo s peer-to-peer transactions. In 2018, Sq are allo ed the trading of Bitcoin on the platform. Since then, the firm has benefited from the recent cr ptoc rrenc boom seeing Cash App re en e rise 502% in 20Q4 compared to the ear prior. The recent addition of fee-free eq it trading in 2020 sho ld help contin e ser gro th on the platform.

O : In the fo rth-q arter 2020, Sq are sa net re en es of $3.16 billion hich as a 141% increase compared to the prior-q arter. S ch a significant ear-o er- ear increase in re en e can be attrib ted to $1.8 billion stemming from bitcoin as part of the Cash App platform. Bitcoin helped Sq are o ercome hat o ld be an other ise lackl ster ear beca se of Co id-19. Were it not for the additional re en e from bitcoin, Sq are s re en e o ld ha e onl gro n b a modest 23% ear-o er- ear. Gross pa ment ol me increased 12% to $32 billion hich as dri en b gro th in Sq are s seller ecos stem. S bscription and ser ice re en e of $449.4 million increased b 60% compared to the prior ear q arter.

Cornell Eq it Research Report 04.11.2021 Sq are, Inc (SQ) Anal st:IEd ard Foote

V

F

I

So rce: S&P Capi al IQ R

P

C E : Sq are operates in an e tremel competiti e en ironment and m st contin e to differentiate itself from ri als in order to s stain gro th. Both Shopif and Pa Pal ha e rob st POS s stems, s pported b ancillar anal tic soft are, that compete ith Sq are s prod cts. Sq are needs to contin e b ilding pon their strong seller ecos stem in order to retain c stomers increasingl reliant pon online anal tics.

C -19: With the accine rollo t in f ll s ing and job n mbers impro ing, both the econom and Sq are are posed to do ell as the United States reopens. In contrast to pre io s ears here the ast majorit of Sq are s GPV stemmed from in-person credit card terminals , Sq are no deri es 50% of their GPV from omni-channel sales. Ho e er, in the e ent of another a e of Co id d e a ne ariant or accine hesitanc , additional Co id restrictions co ld dampen gro th.

H V : Sq are s c rrent Price/Book al e of 43 is far abo e those of its peers and is a res lt of optimistic gro th e pectations ith the econom s reopening. If GPV gro th does not meet e pectations or demand for bitcoin decreases, Sq are s price co ld be ad ersel impacted.

S

: S&P C

IQ,

Cornell Equity Research Report 04/15/2021 Capital One Financial Corp. (COF) Analyst:Siddhant Dahiya Ratings: B

C

Current Price: $135.09

U

M C : 61.8B P/E R : 26.03 D : 1.19%

C

O

F

C

. (COF)

As of April 2020, I believe that Capital One is undervalued. Utilising a comparative analysis, I was able to calculate an intrinsic value, using a 4.1 LTM EV/Revenue multiple, I managed to attain an implied share price of $147.26. This represents a 11.1% upside from its current share price of $132.55.

C

S

I am bullish on the share price because of the significance that COVID-19 has on the business of the financial sector. The pandemic s impacts led to expected credit losses in Capital One s loan portfolio, a decrease in Capital One s payment patterns, an increase in default rates and decrease in consumer spending and demand for credit. Furthermore lower yields and interest rates have led to lower margins for the bank, from 6.83% to 6.06%, which in turn translate to lower revenue. Capital One s central revenues from sources other than their credit card business grew overall, which signifies a reliance on consumer spending and the macro economy. As consumption gets fuelled, we should expect larger loan balances, net interest income, net interchange income and fees.

from 2020 annual report

I expect the return on average assets to continue to grow slowly, and beat estimates. If interest rates rise, Capital One s financials should exponentially improve, although this is dependent on macroeconomic factors. Instead Capital One s growth in their consumer banking division from 60,708 million in 2019 to 66,299 in 2020 is a positive indicator of their business expansion beyond credit cards. Similarly, despite the pandemic their commercial banking division grew from 73,572 million in 2019 to 77,987 million at the end of 2020.

Revenue: $38.18B Net Income: $3.03B

D T Capital One is slowly transforming their auto-loan and general credit business into customer centric and digitised mediums. The gradual move into tech-enabled financing has a bright future. These include their auto-loan application Eno , the Capital One mobile app and Capital One shopping which found users over 160 million dollars in savings.

Revenue: $21.84 B Net Income: $10.86B

Revenue: $15.34B Net Income: $6.44B

Capital One s $537 million investment in Snowflake helped retain a large chunk of their non-interest income, which increased by $357 million to $5.6 billion in 2020 from 2019.

Furthermore Capital One continues to aim to attain higher margins by lowering their non-interest expenses. These expenses decreased by up to $427 million in 2020 from 2019, through lower marketing expense and investments in new technology.

Cornell Equity Research Report 04/15/2021 Capital One Financial Corp. (COF) Analyst:Siddhant Dahiya

V

F

I

Capital one versus competitors share prices since 2018

S

ce: Ya

R

P

F a ce

M

T : COVID-19 pandemic measures could impact Capital One s business, financial condition, liquidity, capital and results of operations will depend on future developments. A flat yield curve combined with low interest rates led to a decrease in Capital One margins, revenue because it would limit their ability to increase the spread between asset yields and funding costs.This led to decreased margins in 2020 and thus lower net income. Any changes in the macroeconomic environment creates a dependency on consumer confidence and customer behaviour, which may significantly affect Capital One s business. If upcoming vaccines do not lead to expected consumption, Capital One may suffer from a low demand for their financial products/services, loans and purchase volumes.

G

D

: 27% of Capital One s commercial loan portfolio is concentrated in the tri-state area of New York, New Jersey and Connecticut. The economic environment of these regions affect the demand of Capital One s commercial products and services, whether customers can repay their commercial loans and the overall value of their loan collaterals.

D

C :. Capital One has expanded their consumer and commercial banking divisions over the years but there is still a dependency on their core business in the credit card division, which makes up 62% of their business. Low consumer purchase volumes and transactions will be dependent on the macro-economy which may reduce the potential upside of Capital One s revenue. Total interest income from their credit card business decreased by 2 billion from 2019 to 2020. Whilst this is true, Capital One s commercial and consumer banking divisions improved in their total interest income over the last 3 years.

S : Capital one Annual Report Yahoo Finance Macrotrends.com

Cornell Equit Research Report A

7, 2021 CVS Health (CVS) Anal st:Emma Braff

Ratings: H C

a

Current Price: $74.39 U

a

Re enue: $267,908 B Market Cap: $97.77 B EBITA: $18,104 B P/E: 13.64 EPS: 5.46 52 Week High: $77.23 52 Week Lo : $55.36

C

Sa

from Q4 2020

CVS H a

One- ear Target Price: $76.35

(CVS)

CVS Health is a multifaceted compan pro iding pharmaceutical, healthcare, and retail ser ices. The Compan has appro imatel 66,000 retail pharmacies and 1,100 MinuteClinic locations in the United States, in hich nurse practitioners and ph sician assistants deli er health care ser ices and related health goods. The compan also pro ides health insurance through their 2018 acquisition of Aetna.

As of April 7th, CVS Health (CVS) is trading at $74.39. I belie e that this equit is onl slightl under alued, gi en e pectations for an increase to $76.35 ithin this ear. I arri ed at this conclusion b utili ing the median multiple. I concluded that CVS Health is deser ing of their current under aluation gi en their recent poor performance.

Re enue: $267.9B

Re enue: $141.5 B

Re enue: $160.6B

M hold recommendation reflects a belief that CVS Health stock has the potential to increase in the long term gi en the acquisiti e beha ior of the compan , but has failed to translate their successes into benefits for shareholders.

Va a : Gi en the abilit to charge insurance up to $40 per COVID-19 accine, pro iding accinations is an e tremel profitable option for healthcare retailers. CVS Health could generate up to $650 million in gross profit from pro iding accinations in their retail locations.

O : CVS Health sa re enue increase b $11.9 billion or 4.6% in 2020 compared to 2019. The also sa total assets gro th of about 6.33%.

This represents a decrease in asset gro th compared to pre ious ears.

In 2018, CVS sa total asset gro th of 106.34%, largel due to their acquisition of Aetna. The follo ing ear, in 2019, the sa asset gro th of 13.16%. Balancing the management of their man ser ices and changing regulations, CVS has failed to maintain the momentum that the gained follo ing the initial acquisition.

Cornell Equit Research Report A

7, 2021 CVS Health (CVS) Anal st:Emma Braff

V

a F a

a I

a

Source: Capital IQ R

P

a

COVID-19: Although CVS Health has the opportunit to profit from their distribution of the COVID-19 accine, the pandemic still creates an uncertain future for the compan . The compan s net income fell more than 40%, partl due to the pandemic. Social distancing precautions led to a lighter flu season and fe er purchases ithin the retail segment. During this time some consumers ha e s itched to e-commerce options for their health good needs, and it is uncertain hether the ill choose to return to CVS after the pandemic ends. It is also rele ant that man of these e-commerce companies and related ne entrants are able to pro ide goods at cheaper prices due to their speciali ation.

P a a B Ma a (PBM): Due to ne entrants, e-commerce, the COVID-19 pandemic, and shifting consumer preferences, there has been an increase in competiti e pressures ithin the PBM industr .

As a result, price compression is a concern for CVS Health. The compan has also shifted to the use of less profitable products as the trend of small emplo ers mo ing to ASC products continues.

R a C a : CVS Health must compl ith increasingl stricter regulations for their Medicare Ad antage plans. This trend of increasingl higher standards is e pected to continue, adding to the compan s costs. CVS Health also e pects for a larger percentage of their re enue to come from federal funding, hich means that the ha e less control o er their finances and ill still be held liable for claims e en during circumstances such as go ernment shutdo ns or legislati e dela s.

S : CVS Health In estor Relations Yahoo Finance Walgreens In estor Relations Forbes Bloomberg Capital IQ CVS Health 10K Nasdaq Wall Street Journal Business Insider

Cornell Eq i

Research Repor

A

2021 S r ker Corpora ion (SYK) Anal s :Q inn Mon gomer

Ra ings: HOLD

C rren Price: $249.87

C

S

a

U da e

In i s mos recen Form 10-K, S r ker has repor ed a decreased ne income of abo $500 million as a res l of COVID-19 S r ker s ffered d ring he COVID-19 pandemic d e o he s dden red c ion in elec i e s rgeries S r ker comple ed i s acq isi ion of Wrigh Medical Gro p in No ember of 2020 a he price of $4.7 billion. This ill grea l e pand S r ker s capabili ies in he pper e remi marke i hin biomedical de ices

C

e

Sa

c

from Q1 2021

e C

One- ear Targe Price: $255.99

a

(SYK)

S r ker Corpora ion is one of he larges biomedical de ice companies in he Uni ed S a es i h a hopping marke capi ali a ion of appro ima el $94 billion. Using s ra egic acq isi ions o er he pas decade, S r ker has made a name for i self on he forefron of biomedical inno a ion.

As of April 8 h, 2021, S r ker (SYK) is rading a $249.87. I belie e ha his eq i is fairl al ed and ha e de ermined a 1- ear price arge of $255.99. I arri ed a his concl sion b cond c ing a comparable compan anal sis sing Med ronic, Johnson and Johnson, and Bos on Scien ific as comparable companies. Selec ed hese companies based off of heir opera ional similari ies, dominan posi ions i hin he biomedical de ice marke , and heir similar geographic ranges.

M hold recommenda ion reflec s a belief ha S r ker ill con in e o perform rela i el ell in 2021, gi en he res mp ion of elec i e s rgeries in he Uni ed S a es and he s ccess of i s acq ired companies s ch as Wrigh Medical and Mako S rgical Corpora ion.

Re en e: $ 14,220 M Ne Income: $1,756 M EV/EBITDA: 26.4

S a e c Ac : In 2013, S r ker acq ired Mako S rgical Corpora ion for $1.65 billion.

This ga e S r ker access o Mako s niq e robo ic s rger echnologies.

In recen rials, Mako s robo ic s rger arms ha e led o less pos opera i e pain and fas er pa ien healing b g iding s rgeons on here he m s make incisions, preser ing he mos heal h iss e of a pa ien hile s ill resol ing heir heal h iss es.

Re en e: $27, 927 M Ne Income: $4,420 M EV/EBITDA: 26.8

S r ker also recen l acq ired Wrigh Medical as disc ssed in he compan pda e. Wrigh Medical has a speciali a ion in biomedical de ices for pper e remi ies s ch as he arm and sho lder hich is c rren l he fas es gro ing segmen of biomedical de ices for or hopedics.

Re en e: $80,856 M Ne Income: $20,157 EV/EBITDA: 16.4

O e e : Follo ing S r ker s acq isi ion of Wrigh Medical in No ember of 2020, S r ker s s ock increased b ro ghl 10%. Since hen, he s ock has seen mild gro h of ro ghl 5%, b his gro h is primaril based on impro ing op imism regarding he s ccess of COVID-19 accines and a possible concl sion o he pandemic, ra her han an impro emen in he in rinsic al e of S ker s s ock.

Considering ncer ain regarding S r ker s b siness ac i i ies in he coming ear i h he slo ing of he COVID-19 pandemic, his makes he associa ed price projec ions for S r ker s s ock o be ncer ain as ell, j s if ing m hold recommenda ion.

Cornell Eq i

Research Repor

A

2021 S r ker Corpora ion (SYK) Anal s :Q inn Mon gomer

V

a F a ca I

a

Source: Capital IQ R

P e

a

I e Ma ac S C a : S r ker has a n mber of in erna ional man fac ring loca ions, man of hich are in China. Considering he pas rade ensions i h he Uni ed S a es and ncer ain regarding foreign polic in he ne Biden adminis ra ion, his co ld significan l infl ence S r ker s s ppl chain as i is so relian on in erna ional man fac ring loca ions and rade polic .

US a d I e a a G e e Re a : Since S r ker opera es on a global scale and heal h s andards end o be rigoro sl enforced b go ernmen policies, his has large implica ions for ho S r ker s prod c s fare in domes ic and in erna ional marke s. If a cer ain go ernmen de ermines an fla s in S r ker;s prod c s, his o ld no onl harm S r ker s sales, b o ld also harm i s rep a ion and brand image.

E e E c a e Ra e F c a : Appro ima el 30% of S r kers sales come from in erna ional marke s ha in ol e foreign c rrencies s ch as he A s ralian dollar, Bri ish po nd, and Japanese en. As a res l , i h global economic o looks ncer ain d e o ar ing accine rollo programs and he COVID-19 pandemic s ill highl infl en ial, S r ker faces a large e pos re o ar ing economic condi ions in in erna ional marke s hich co ld harm i s re en es.

S ce : S r ker In es or Rela ions Yahoo Finance Med ronic In es or Rela ions Johnson and Johnson In es or Rela ions Capi al IQ

Cornell Equit Research Report 04/16/21 Intuiti e Surgical, Inc. (ISRG) Anal st: Core Edelman

Ratings: B C

a

Current Price: $794.47 U da

I

Intuiti e Surgical as negati el impacted due to the COVID-19 pandemic. The cause of this impact can mostl be attributed to the sudden reduction in electi e surgeries In its most recent Form 10-K, Intuiti e Surgical has reported a decreased net income of about $318 million as a result of COVID-19 Intuiti e surgical completed its acquisition of Orpheus Medical Group in Februar of 2020 at the price of $4.7 billion. This ill pro ide customers ith the abilit to access a deeper understanding of their data, capture and share clinical ideo, and ill allo for easier and faster access to customer data.

C

Sa

c

from Q4 2021

Re enue: $1.33 B Net Income: $365 M EV/EBITDA: 66.4

Re enue: $ $5.99 B Net Income: $777 M EV/EBITDA: 17.9

Re enue: $1.35 B Net Income: $495 M EV/EBITDA: 9.4

S

One ear Target Price: $942.76

ca , I c. (ISRG)

Since Intuiti e Surgical s listing in the Ne York Stock E change on Ma 2, 2000, the stock has gro n more than 12,967%. Since then, Intuiti e Surgical has gro n to one of the largest pro iders of robotic surgeries, accounting for 80.6% of all robotic-assisted surgeries and 5 million minimall in asi e procedures. As of April 13th, Intuiti e Surgical, Inc. (ISRG) is trading at $794.47. I belie e that this equit is under alued and e pected to increase to $942.76 ithin the ne t fe ears. I arri ed at this conclusion b conducting a DCF anal sis ith a 2% perpetuit gro th rate, 31.28% operating margin, and a WACC of 4% across 5 ears. These assumptions are based on historical data and an optimistic ie gi en Intuiti e Surgical s performance histor .

M bu recommendation reflects a belief that Intuiti e Surgical ill continue to perform ell, gi en the increase in da Vinci S stem implementations, a projected increase in future electi e surgeries, and the launch of the compan s $100 million enture fund. da V c S : The da Vinci S stem as one of the first robotic-assisted, minimall in asi e surgical s stems cleared b the FDA. The s stem accounts b far for the greatest share of robotic surgeries, 80.6% to be e act. In the US, the da Vinci as used to perform about 421,000 general surger procedures representing about 48% of o erall US da Vinci procedures; 282,000 g necologic surger procedures; and 138,000 urologic procedures. Initiati e s install base gre b 7% e en ith hospitals facing serious head inds from the COVID-19 pandemic. Recent impro ements upon its instrument reliabilit no allo instruments to be used for a higher number of procedures. The increased life span of the instruments ill reduce the cost for healthcare facilities to treat patients. $100 M V F d: This past October, Intuiti e launched its first $100 million enture capital fund, called Intuiti e Ventures. It ill in est in companies that align ith its commitment to ad ancing positi e outcomes in healthcare and ill focus on opportunities surrounding digital tools, precision diagnostics, and focal therapeutics.

O : Intuiti e Surgical sa total assets increase from $9.7 billion to $11.2 billion and total liabilities decreased from $1.44 billion to $1.41 billion.

This reflects the compan s abilit to pa back its debt sufficientl as e en hen decreasing liabilities, the compan as able to increase its assets. It is forecasted that shipments and procedures ill dramaticall increase due to the successful accine rollout and predicted increase in electi e surgeries.

Cornell Equit Research Report 04/16/21 Intuiti e Surgical, Inc. (ISRG) Anal st: Core Edelman

V

a F a ca I

a

Intuiti e Surgical, Medtronic, and Hologic Share prices since 2002

S

ce: Ya

R

P

F a ce a

H C : In recent ears, the market for non-in asi e robotic surgeries has become highl saturated and highl competiti e. Man of its competitors are reducing the upfront price of their surgical s stems, accessories, and training programs. In order to diminish the risk of fierce competition, Intuiti e has launched an e tended use program for the majorit of its products, updated a set of select and Arista instruments, and has in ested in high-priorit programs. Furthermore, the reason for the increase in competitors comes from the e ponential increase in demand, meaning there are a sufficient number of consumers.

P b cH a C : Uncertaint regarding potential corona irus spikes has led to a decrease in da Vinci procedures. After the initial decline in procedures during the period of national lockdo n, e sa an 8% increase in procedures in October. As cases began to spike again, e sa a 6% decrease in procedures this past October. In order to increase procedures, and therefore sales, the compan has updated safet protocols to respond to COVID-19, rapidl shifted training centers closer to our customers to limit their tra el and has launched a financial relief program hich includes ser ice credits, arrant credits, and e tensions, and more fle ible lease pa ment and purchasing terms for ne s stems.

O d d b : Intuiti e relies solel on single-source suppliers, hich can be e tremel detrimental hen manufacturing products. This ill cause a loss of control and operational efficienc . Additionall , this ill lead to higher transaction costs. In order to mitigate these problems, Intuiti e maintains an integrated and efficient suppl chain to reduce risk and be more cost-effecti e. The compan also makes sure to conduct financial due diligence to ensure long-term supplier iabilit .

S c : Intuiti e Surgical In estor Relations Pharma Intelligence In estors.com Nasdaq fool.com Yahoo Finance Veri on In estor Relations MedTech Di e Wolters Klu er Capital IQ Financial Times