HI-Quality Company Updates Monday, March 30, 2020Johnson & Johnson-JNJ announced the selection of a lead COVID-19 vaccine candidate from constructs it has been working on since January 2020; the significant expansion of the existing partnership between the Janssen Pharmaceutical Companies of Johnson & Johnson and the Biomedical Advanced Research and Development Authority (BARDA); and the rapid scaling of the Company's manufacturing capacity with the goal of providing global supply of more than one billion doses of a vaccine. The company expects to initiate human clinical studies of its lead vaccine candidate at the latest by September 2020 and anticipates the first batches of a COVID-19 vaccine could be available for emergency use authorization in early 2021, a substantially accelerated timeframe in comparison to the typical vaccine development process. Through a landmark new partnership, BARDA, which is part of the Office of the Assistant Secretary for Preparedness and Response (ASPR) at the U.S. Department of Health and Human Services, and Johnson & Johnson together have committed more than $1 billion of investment to co-fund vaccine research, development, and clinical testing. UPS’s-UPS dedicated people, global network and public-private partnerships are creating a powerful combination for rapid deployment of protective equipment and test kits throughout the U.S., and around the world,” said UPS Chairman and CEO, David Abney. “UPS Healthcare has the expertise and experience to move vital, life-saving medicines, medical devices, diagnostic specimens and supplies everywhere they are needed.” UPS announced a stepped-up collaboration with FEMA to provide supply chain services for the agency’s distribution of PPE and necessary materials throughout the U.S., including respirators, N95 masks, and gloves for use by healthcare workers across the country. As part of the collaboration, FEMA will gain access to UPS’s expansive Worldport® facilities in Louisville for temporary staging of critical shipments from overseas. Additionally, UPS is working with an array of government agencies and companies to support swift transportation of test kits, PPE, supplies and medical devices. UPS Healthcare President Wes Wheeler. “Our strength is our ability to be nimble in times of emergencies, whether natural disasters or pandemics, so we will continue to do our part to help us all through this challenge.”Raytheon-RTN will produce and deliver SM-3® Block IB interceptors under a $2.1 billion, multi-year U.S. Missile Defense Agency contract. It is the first multi-year contract for the SM-3 program and covers fiscal years 2019–2023. SM-3 is the only ballistic missile interceptor that can be launched on land and at sea. It is deployed worldwide and has achieved more than 30 exoatmospheric intercepts against ballistic missile targets.Friday, March 27, 2020Alphabet-GOOGL is pledging $800 million in relief funds to customers and health-care workers to address the coronavirus pandemic. The contributions include $250 million in advertising credits for the World Health Organization and $340 million to small businesses to run promotions with Google. The economic fallout from the pandemic has dried up marketing spending. Another $20 million gives researchers working on the novel virus credits to use the company’s cloud-computing services. Google also said it would be working with a partner, Magid Glove and Safety Manufacturing LLC, a supplier based in Illinois, to produce between 2 million and 3 million protective face masks in the coming weeks to help meet the shortage for hospitals. Apple-AAPL is releasing an app and website that will direct users to guidance from the Centers for Disease Control on the disease caused by the coronavirus. The app, which will be available in the app store as “COVID-19,” will ask users questions about symptoms, location and risk factors and then provide the appropriate up-to-date guidance from the CDC. The app will also answer frequently asked questions about the coronavirus disease with official information from the CDC. The same information will be available at a website https://www.apple.com/covid19 that will be accessible to the users of Windows PCs, Android phones and other non-Apple devices. Apple said that it will not collect the answers users give to the app and website's questions and that the answers will not be sent to either Apple or any government entity. Apple Chief Executive Tim Cook said that the company had donated 10 million protective masks to U.S. health care groups after using Apple's supply chain team to locate and buy the masks. Walgreens Boots Alliance-WBA expands pick-up offerings at drive-thru services. As more and more people across the country continue to look for safe and convenient options to pick up daily essentials amidst the COVID-19 pandemic, Walgreens is now offering select products at its more than 7,300 pharmacy drive-thrus nationwide. The offering provides greater convenience while also helping to promote social distancing. More than 60 front-end products are currently available for purchase at drive-thru, including household essentials chosen specifically to support the needs of customers and communities during the pandemic.Oracle-ORCL director Charles Moorman purchased $1 million of the company’s stock.Thursday, March 26, 2020FactSet-FDS reported fiscal second quarter revenue increased 4.2% to $369.8 million with net income net income and EPS increasing 5% to $88.7 million and $2.30, respectively. FactSet’s sales increase was powered by higher sales of analytics, wealth management solutions, and content and technology solutions (CTS). Annual Subscription Value (ASV), which represents the forward-looking revenues for the next twelve months from all subscription services currently supplied to clients, increased 4% to $1.5 billion, driven by higher sales in FactSet's analytics, CTS, and wealth workflow solutions and a price increase in the Americas region. Annual ASV retention was greater than 95%. When expressed as a percentage of clients, annual retention was 89%. Employee count was 9,892, up 3.8% over the last twelve months. Client count at quarter-end was 5,688, a net increase of 87 clients in the past three months. User count increased by 2,111 to 128,896 during the quarter, driven by in increase in wealth advisors and portfolio managers. During the quarter, FactSet generated $74.6 million in free cash flow, down 15% from last year, on higher capital expenditures due to new office space build out and technology upgrades to fuel growth. During the quarter, FactSet repurchased 267,500 shares of its common stock for $74.2 million, or $277.28 per average share. The board recently approved an increase of $220 million to the existing share repurchase program, bringing the total authorized to $300 million. The company ended the quarter with $367 million in cash, $574 million in long-term debt and $717 million in shareholders’ equity. Given all the uncertainty created by COVID-19, FactSet revised its full fiscal year guidance with ASV now expected to increase in the range of $50 million to $75 million over 2019 with revenue expected in the range of $1.49 billion and $1.5 billion and EPS in the range of $8.70 and $9.00. With FactSet’s subscription model, stable and robust cash flows and strong balance sheet, management is confident in FastSet’s resiliency during periods of uncertainty. Indeed, with its flexible technology platform, clients look to FactSet to help them implement their continuity plans which include remote work. Wednesday, March 25, 2020Paychex-PAYX reported third quarter revenues rose 7% to $1.1 billion with net income and EPS each up 9% to $354.5 million and $.98, respectively. During the quarter, Paychex experienced solid growth across all major business lines. These results largely predated the disruption caused by the COVID-19 outbreak. Interest on funds held for clients decreased 7% to $21.2 million in the quarter due to lower average interest rates earned as interest rates were cut by the Fed. The company’s financial position remains strong with cash of $853.4 million and net debt of $847.9 million. Free cash flow increased 3% to $960.8 million through the first nine months of the year with the company paying $666.8 million in dividends and repurchasing $171.9 million of common stock. Paychex’s positive cash flows have historically allowed the company to support their business and to pay substantial dividends. The dividend currently yields an attractive 4%. Paychex’s strong financial position and cash flows should enable them to continue to pay their dividend despite expected business weakness from COVID-19. For the 2020 fiscal year ending in May, management anticipates revenues will increased 8% to 9% with an operating margin of 36%, and adjusted net income and EPS each increasing 6%. In fiscal 2021, Paychex expects revenues to be flat to down in the low single- digit range with the operating margin dipping to 35%. Paychex thinks once the economy reopens, a solid bounce back will occur as the biggest challenge for small business prior to COVID-19 was finding workers due to full employment. Paychex expects the first fiscal 2021 quarter to show a significant decline due to the sharp recession that will impact the small businesses they serve with the second and third quarter expected to show modest improvement with recovery by the fourth quarter. The Federal Government is addressing the challenges small businesses are facing with significant stimulus designed to help keep employees on the payroll.MAXIMUS-MMS suspended its fiscal 2020 revenue and earnings guidance due to the uncertainty of the impact on global operations following the emergence of the coronavirus pandemic (COVID-19). The duration and broader implications of the pandemic and related developments cannot be reasonably predicted at this time, but MAXIMUS expects negative impacts to the income statement and cash flows for fiscal 2020. The Company’s strong balance sheet will enable it to meet its contractual and financial obligations as these come due, including its income protection plan for its employees. Going forward, MAXIMUS will continue to exercise a disciplined approach to cash outflows in an effort to maintain liquidity and flexibility. The Company will continue its ongoing evaluation of its cash position and use of cash on a holistic basis which includes its approach to buybacks, dividends, and M&A. The MAXIMUS share purchase program will conclude on March 25, 2020, under a share purchase plan previously implemented by the Company and will be re-evaluated once there is clarity around the impact of the COVID-19 crisis. MAXIMUS believes it has adequate cash reserves, including access to a $400 million revolving credit facility to navigate this pandemic.A study led by UnitedHealth Group-UNH Research & Development and OptumCare clinicians has demonstrated that a simple, self- collected test is as effective in identifying COVID-19 infections as the current clinician-collected test. Widespread adoption of this less invasive test will reduce exposure for health care workers and improve overall testing efficiency across the country. "We know that broad, rapid and accurate testing is essential to addressing the COVID-19 crisis, yet the current clinician-administered process significantly limits testing capacity, puts frontline health care workers at risk of COVID-19 exposure, and is unpleasant for patients," said study-lead Dr. Yuan-Po Tu, an infectious disease expert at The Everett Clinic, part of OptumCare. "Making simple, patient-administered testing widely available will substantially improve testing efficiency, while protecting health care workers and preserving urgently needed personal protective equipment, such as face masks, gowns and gloves."Tuesday, March 24, 2020COVID-19 has upended the lives of billions of people around the world. In response to this emergency, Facebook-FB has been supporting the global public health community and working to provide people with information to help them stay safe. As the pandemic expands and more people practice physically distancing themselves from one another, this has also meant that many more people are using their apps. In many of the countries hit hardest by the virus, total messaging has increased more than 50% over the last month. Similarly, in places hit hardest by the virus, voice and video calling have more than doubled on Messenger and WhatsApp. In Italy, specifically: Facebook has seen up to 70% more time spent across their apps since the crisis arrived in the country. Instagram and Facebook Live views doubled in a week. They have also seen messaging increase over 50% and time in group calling (calls with three or more participants) increase by over 1,000% during the last month. Much of the increased traffic is happening on their messaging services, but they’ve also seen more people using their feed and stories products to get updates from their family and friends. Facebook doesn’t monetize many of their services where increased engagement is occurring while working hard to keep these services stable and reliable. At the same time, Facebook’s business is being adversely affected like so many others around the world due to reduced advertising in countries taking aggressive actions to reduce the spread of COVID-19. Nike-NKE reported third quarter revenues rose 5%, or 7% on a constant currency basis, to $10.1 billion with net income down 23% to $847 million and EPS off 22% to $.53. Digital sales increased 36%. Earnings were impacted by COVID-19 in Greater China and a $.25 per share non-recurring, non-cash charge associated with the transition to a strategic distributor model in South America. Growth was broad-based across geographies and product lines, offset by the impact of COVID-19 on business in Greater China. Greater China revenues were down 4% during the third quarter following 22 consecutive quarters of double-digit growth. Digital sales in Greater China increased more than 30% while brick and mortar retail sales were impacted by temporary store closure related to COVID-19. At the peak of the health crisis in Greater China, 75% of Nike stores were closed. Currently, nearly 80% of Nike stores have reopened in China. Greater China has provided Nike with the playbook to get through the coronavirus crisis in the rest of the world by following four actions. 1) Containment occurred to close stores for 5-6 weeks to protect employees and customers. While people were confined at home, Nike engaged digitally with customers through a Training Workout app to help customers remain active at home. The app saw an 80% increase in users which then fed into its digital business with digital sales up more than 30%. 2) Nike’s recovery stage began in China about 30 days ago as they reopened stores, including stores in Wuhan to strong demand. 3) Normalization then occurred with some stores already back to pre-virus levels with digital sales remaining strong.4) Nike expects to return to profitable, capital efficient growth leveraging their strong financial position and brands. Nike saw this same strategy play out in Japan and South Korea and expects to follow the same playbook in Europe and North America even as the company expects several challenging weeks in the U.S. in the quarter ahead. While Nike cannot predict how long containment will last in the U.S., they know they will see the other side of the crisis in the near future. Nike expects to emerge from the crisis with their brands stronger than ever as they gain market share and “strong brands get even stronger.” While Nike’s strong brands are a competitive advantage, so is their financial strength. Liquidity is not an issue for Nike as they maintain a strong balance sheet with more than $3 billion in cash and ample capital fueled by their strong cash flows. During the third quarter, Nike repurchased 9.6 million shares of common stock for about $957 million with about $11 billion remaining authorized for future share repurchases. Given the uncertainty about the coronavirus containment in the United States, Nike is unable to provide guidance for the fiscal fourth quarter.Microsoft-MSFT CEO S. Nadella made these comments on CNBC: He called Microsoft "digital first responders," and noted that Teams is now used by 44 million daily users as customer use from home increases. He described Azure scale as "unprecedented” with the company seeing peak demand in Azure. They also are seeing peak demand in Xbox. SaaS and cloud architectures is holding and scaling as needed. Microsoft expects return to work across the country will be in waves, not all at once. They expect new demand when the virus subsides and are confident Microsoft will come out of this period very strong. Microsoft is supportive of fiscal stimulus to aid workforce -- both those out of work and those who are planning on coming back. UnitedHealthcare-UNH announced several updates to its programs in response to the COVID-19 national emergency. In addition to previously announced telehealth and virtual care expansion, the company will open a special enrollment period for some of its existing commercial customers to enable people to get coverage for their health care needs. The company is also further easing administrative requirements to access care through reduced prior authorization requirements.As the impact of the virus has rapidly expanded around the globe, Mastercard-MA has seen further deterioration in their cross-border, switched volume and switched transaction metrics, although revenue related to services lines has held up reasonably well. As a result, they are making the following updates to first quarter year-over-year growth rates for both net revenue and operating expenses with first quarter growth in net revenue in the low-single-digits range. The foreign currency impact will be about a 2%-point headwind to net revenue growth in the first quarter. First quarter growth in operating expenses is expected in the low-to-mid-single-digits range. The long-term fundamentals of their business remain strong. However, due to the speed with which the COVID-19 situation is developing and the unknown duration and severity of the event, Mastercard suspended their annual 2020 outlook for both net revenue and operating expense growth at this time.In response to COVID-19’s impact on travel, Booking Holdings-BKNG is cutting non-essential business travel across their business; cancelling internal company events and offsites; dramatically reducing marketing spend worldwide; and implementing a general hiring freeze company-wide until further notice. In addition, senior management is forgoing salaries during this time of the crisis, effective immediately. The Board of Directors has also voluntarily declined to accept any cash retainer payments during the same time period.Genuine Parts-GPC Director Tom Gallagher disclosed the purchase of 5,000 shares worth about $276,000 (transaction date 3/23).Friday, March 20, 2020Adaptive Biotechnologies Corp. and Microsoft-MSFT announced they will leverage their existing partnership mapping population-wide adaptive immune responses to diseases at scale to study COVID-19. Finding the relevant immune response signature may advance solutions to diagnose, treat and prevent the disease, augmenting existing research efforts that primarily focus on the biology of the virus. These data will be made freely available to any researcher, public health official or organization around the world via an open data access portal. "The solution to COVID-19 is not likely going to come from one person, one company or one country. This is a global issue, and it will be a global effort to solve it," said Peter Lee, corporate vice president, AI and Research, Microsoft. "Making critical information about the immune response accessible to the broader research community will help advance ongoing and new efforts to solve this global public health crisis, and we can accomplish this goal through our proven TCR-Antigen mapping partnership with Adaptive."On March 18, Congress passed and the President signed into law the Families First Coronavirus Response Act to address the impact of the coronavirus (COVID-19) pandemic. Paychex-PAYX is helping business owners understand what the legislation means, both for their business and employees, as well as offering support and resources. In general, the Families First Coronavirus Response Act dedicates tens of billions of dollars for paid sick and family leave, unemployment insurance, free COVID-19 testing, and other measures to help Americans impacted by the crisis.Since the COVID-19 outbreak, 3M-MMM has doubled its global output of N95 respirators to an annual rate of over 1.1 billion per year, or nearly 100 million per month. In the U.S., 3M currently manufactures more than 400 million N95 respirators annually, which is increasingly being directed to support both government and public health response. The company also manufactures respirators at locations in Europe, Asia Pacific and Latin America. In addition, 3M is increasing its investments, primarily in the U.S., to expand its global capacity by over 30 percent in the next 12 months. The company is also maximizing production of a wide range of other products used in the COVID-19 response globally including hand sanitizers, disinfectants and filtration solutions as the pharmaceutical industry works to find a vaccine to fight the virus. 3M is working with governments, medical officials, customers and distributors around the world to help get supplies where they are needed most. 3M has not changed the prices it charges for 3M respirators as a result of the COVID-19 outbreak, but the company cannot control the prices dealers or retailers charge for 3M respirators. Thursday, March 19,2020Accenture-ACN reported strong fiscal second quarter results with revenues up 7% to $11.1 billion and net income and EPS each up 10% to $1.2 billion and $1.91, respectively. Operating margin expanded 10 basis points to 13.4% during the quarter. The company reported record new bookings of $14.2 billion including consulting bookings of $7.2 billion and outsourcing bookings of $7 billion. Growth was broad-based among operating groups and geographies led by 14% growth in the Health & Public Service group and 11% growth in North America. During the first half of the year, free cash flow declined 5% to $2.1 billion with the company paying $1 billion in dividends, a 10% increase over last year, and repurchasing $1.7 billion of its common stock. The company ended the quarter with a strong financial position with more than $5.7 billion in cash and investments. The world is now facing a global health crisis and a significant disruption in the global economy, which Accenture is adapting to and successfully navigating. About 65% of Accenture’s revenues are derived from digital, cloud and security services. With most workers now required to work remotely, the company is seeing strong demand for these services. Given the significant uncertainty regarding the duration and magnitude of the economic impact of the coronavirus, Accenture lowered their outlook for fiscal 2020. The fiscal third quarter is expected to feel the biggest impact with the fiscal fourth quarter expected to see improvement as the world adjusts to the new environment. For fiscal 2020, Accenture now expects revenue growth to be in the range of 3% to 6% in local currency, compared with 6% to 8% previously with EPS expected in the range of $7.48 to $7.70 compared with $7.66 to $7.84 previously. Free cash flow in fiscal 2020 is expected in the range of $5.5 billion to $6.0 billion compared with $5.7 billion to $6.1 billion previously with management expected to return $4.8 billion in cash to shareholders through dividends and share repurchases.The TJX Companies-TJX announced several actions related to its response to the rapidly changing market uncertainty from the COVID-19 pandemic. Effective today the Company is closing all of its stores in the United States, Canada, Europe, and Australia for two weeks. In certain regions, including Germany, Poland, Austria, Ireland, and the Netherlands, and a number of U.S. and Canadian locations, the Company had previously closed stores based on several factors, including government or health department requirements. The Company is also closing its online businesses tjmaxx.com, marshalls.com, and sierra.com. Further, the Company is temporarily closing its distribution centers and offices, with Associates working remotely when they can. We know our Associates are very concerned for their health and financial well-being, and we plan to pay our store, distribution center and office Associates for two weeks during these closures. To further strengthen its financial position and balance sheet, and maintain financial liquidity and flexibility, the Company is taking the following actions: Drawing down $1 billion from its revolving credit facilities; suspending its share repurchase program; evaluating its dividend program; reviewing all operating expenses; and reducing capital expenditures. The Company also announced today that it is withdrawing its first quarter and full year Fiscal 2021 financial guidance given on its February 26, 2020 earnings conference call. The Company is not providing an updated outlook at this time. As the COVID-19 pandemic is complex and evolving rapidly, the Company’s plans as outlined above may change.Johnson & Johnson-JNJ is running its Tylenol manufacturing at maximum capacity in North America in order to contend with surging demand for the product due to the fast-spreading coronavirus outbreak. "We're running it at all-out, maximum capacity," said Kathleen Widmer, group chairman for North America of Johnson & Johnson Consumer Health. Widmer said that they had added crews and were maximizing the use of equipment and capacity in plants in Puerto Rico and Pennsylvania where the drug is produced. Widmer also said the company is not experiencing a shortage of the raw materials it needs to make Tylenol. Microsoft-MSFT said that Teams, its chat and conferencing app, reached 32 million users as of March 11 amid a surge in remote work by companies around the world in response to the coronavirus outbreak. The number was up sharply from November, when Microsoft said it had 20 million daily active users. Microsoft also rolled out several features designed to help with telemedicine and working from home, such as bookings application for Teams to help hospitals manage virtual appointments. "As organizations around the world are changing the way they work in response to the [coronavirus] situation, we're going to learn a tremendous amount," Satya Nadella, Microsoft's chief executive, said in a virtual news conference. Microsoft charges fees to businesses for its full versions of Teams, but there is a free version that can be used by consumers. Microsoft said Thursday that doctors at St. Luke’s University Health Network in Pennsylvania, who had already been using the Teams app, will start tapping it for videoconferencing with patients, including those vulnerable to the novel coronavirus, to protect patients and the hospital. Microsoft also said it was working on several new features using artificial intelligence that could make working from home easier for Teams users. One feature can automatically replace the background during a video chat, for example cropping out a messy home bedroom and replacing it with a picture of a tidy commercial office. Another feature can filter out background sounds during a conference call, such as the crinkling of a plastic potato chip bag.During the COVID-19 outbreak, Tractor Supply-TSCO is committed to staying open and providing customers the everyday products they rely on, including animal feed, pet food, livestock and pet medicines, agricultural supplies, hardware and maintenance supplies, hydraulic fluid for farm equipment, lawn and vegetable garden products, and heating and fuel. Currently, all Tractor Supply stores are open and plan to remain open to support customers. Serving rural communities for more than 80 years, Tractor Supply has provided essential, needs-based products that rural customers depend on to help them take care of their families, homes, land, livestock animals and pets. At this critical time, the Company is making an investment to enhance customer service in store through additional store labor hours and increasing its inventory of animal feed and pet food. The Company has a long history of helping customers in times of need and serving as a key resource in the local communities it calls home. In order to protect our team members and prevent the spread of the virus, our stores are conducting extra daily cleanings to give our customers the safest environment to shop in. Tractor Supply is extending its paid sick leave for full-time and part-time team members affected by illness. Beginning last week, all team members can receive up to an additional two weeks of paid sick leave. Team members who self-report contagious, flu or COVID-19 symptoms that keep them out of work; are part of a mandated or self-imposed quarantine; are impacted by the temporary closing of a location due to the outbreak; or have a confirmed case of COVID-19 will continue to be paid during that time.Ross Stores-ROST provided a business update in response to the impact of COVID-19 on the Company’s operations. While February sales were ahead of its expectations, the Company has experienced a broad-based deceleration in sales trends over the past week from the continued spread of the virus throughout the country and the mandatory closure of stores in certain markets. Further, additional store closures are expected. As a result of this unprecedented period of uncertainty, including the unknown duration and overall impact on consumer demand, the Company is withdrawing its first quarter and 2020 full year sales and earnings guidance issued on March 3, 2020. To preserve financial liquidity, and out of an abundance of caution, management is also temporarily suspending the Company’s stock repurchase program and is drawing down $800 million under its revolving credit facility to add to its cash balances. In addition, the Company is currently reducing its capital expenditure and expense plans as well as aligning inventory positions with current sales trends in the business.Wednesday, March 18, 2020MAXIMUS-MMS announced that its Board of Directors has authorized the expansion of purchases of MAXIMUS common stock of up to an aggregate of $200 million, which includes the remaining balance from the 2018 authorization of $37.2 million as of March 17, 2020. "We remain committed to the execution of our strategic priorities to drive shareholder value and this includes the opportunistic purchase of MAXIMUS common stock. We view this step as a thoughtful and disciplined approach to capital allocation that is beneficial to shareholders and a pillar of our long-term strategy," commented Bruce Caswell, Chief Executive Officer and President of MAXIMUS.As the world grapples with the vast scale and human impact of COVID-19, Starbucks-SBUX CEO Kevin Johnson says Starbucks has the financial strength and resilience to manage through this extraordinary time. With customer and partner (employee) safety paramount, Starbucks activates its “to go” model for communities across the US & Canada, leveraging theStarbucks mobile app, Drive Thru and new Starbucks® Delivers. Starbucks offers paid sick leave and catastrophe pay and also announces a new mental-health benefit for U.S. partners and their families. The company celebrates continued recovery in China, with 90 percent of stores now open and the announcement of a new sustainable roasting plant coming in 2022. Starbucks announced today that its Board of Directors has authorized the repurchase of up to 40 million shares of the company’s common stock. This authorization is in addition to the approximately 16 million shares that remained available as of December 29, 2019 for repurchase under an existing authorization. In fiscal 2019, the company returned $12 billion to shareholders through a combination of dividends and repurchases of approximately 140 million shares.Tuesday, March 17, 2020For 21 years, Google’s mission has been to organize the world’s information and make it universally accessible and useful. Helping people get the right information to stay healthy is more important than ever in the face of a global pandemic like COVID-19. Google is partnering with the U.S. government in developing a website dedicated to COVID-19 education, prevention, and local resources nationwide. This includes best practices on prevention, links to authoritative information from the World Health Organization (WHO) and the Centers for Disease Control (CDC), and helpful tips and tools from Google for individuals, teachers and businesses. Alphabet’s-GOOGL Verily, which is focused on health and life sciences, is working in collaboration with California state, local and federal health authorities to help establish testing sites in the San Francisco Bay Area, and on an online tool to increase risk screening and testing for people at high risk of COVID-19. Californians will be able to take an online COVID-19 screener survey through Verily’s Project Baseline, and those who meet eligibility and requirements for testing will be directed to mobile testing sites based on capacity. While Verily is in the early stages of this pilot program, the plan is to expand to other locations over time. As previously shared, DeepMind released predictions that could help scientists better understand the coronavirus protein structure in order to develop future treatments. UPS-UPS continues to deliver for customers even as Coronavirus uncertainty is requiring greater flexibility and creativity to adapt to new social distancing and other health maintenance protocols. Recently, the White House through the Rapid-Response Taskforce for Coronavirus Testing Sites asked UPS to assist with the logistics planning and operations to support the opening and regular operation of drive-up Coronavirus community-based testing sites in several cities. UPS is ready to assist with transportation support as needed for the community-based testing sites. As the COVID-19 outbreak escalates, Facebook’s-FB focus has been on keeping people safe and informed by making sure everyone has accurate information, supporting global health experts and stopping misinformation. Facebook is providing $100 million in loans to help 30,000 small businesses in over 30 countries to help pay employees who can’t come to work and to cover rent and operational costs. Facebook is also offering a $1,000 bonus to each of its 45,000 employees.Ulta Beauty-ULTA announced updates to its operations in response to the continued spread of COVID-19. With COVID-19 continuing to spread throughout the U.S., Ulta Beauty believes it is the Company’s responsibility to help communities and governments contain this pandemic. As a precautionary measure, Ulta Beauty will temporarily close all of its stores effective 6:00 p.m. on March 19, 2020 until at least March 31, 2020. However, most stores will continue to be outlets for buy online and pick up in store as allowed by local and state regulations, and all guests can continue to shop through the Ulta Beauty app or visit ulta.com. Due to the fast-moving nature of this situation and the uncertainty of impacts on costs and revenue, the Company is withdrawing guidance previously issued for fiscal 2020. The Company is not providing an updated outlook at this time.Thursday, March 12, 2020Ulta Beauty-ULTA reported fiscal fourth quarter sales increased 8.5% to $2.3 billion with net income up 3.7% to $223 million and EPS increasing 7.8% to 3.89. Comparable sales--sales for stores open at least 14 months and e-commerce sales--increased 4% on top of a of 9.4% in the fourth quarter of fiscal 2018. The 4% comparable sales increase was driven by 1.8% transaction growth and 2.2% growth in average ticket. For fiscal 2019, net sales increased 10.1% to $7.4 billion with net income increasing 7% to $706 million and EPS up 11% to $12.15. Comparable sales increased 5%, compared to an increase of 8% in fiscal 2018. The 5% comparable sales increase was driven by 3.3% transaction growth and 1.7% growth in average ticket. Ulta Beauty ended fiscal 2019 with 1,254 stores and square footage of 13,193,076, representing a 6.9% increase in square footage compared to fiscal 2018. During fiscal 2019, Ulta Beauty generated a glamourous 37.1% return on shareholders’ equity and $803 million in free cash flow, which represented nearly 114% of reported earnings, a sign of high-quality reported earnings. During fiscal 2019, the company repurchased 2,320,896 shares of its common stock at a cost of $681 million, or $293.42 per average share. The company’s board of directors approved a new share repurchase authorization of $1.6 billion, with the company expecting to repurchase $1.3 billion during fiscal 2020. Since 2014, Ulta Beauty has returned $2.2 billion to shareholders through its share repurchase program, while continuing to make strategic growth investments. The company ended fiscal 2019 with $502.3 million in cash and investments, lease obligations of $1.7 billion and shareholders’ equity of $1.9 billion. Management is carefully watching the unfolding COVID-19 situation, placing paramount importance on the health and safety of its associates, guests and partners. To that end, the company has increased store sanitation protocols, changed tester policies, limited employee travel, postponed large group gatherings and told associates to stay home if they are not feeling well with the assurance they be compensated for sick leave. For fiscal 2020, Ulta Beauty expects to open about 75 net new stores, execute about 15 remodel or relocation projects, and complete about 42 store refreshes. Sales are expected to increase by about 7% to 8% on comparable sales growth of 3% to 4%. EPS are expected in the $12.55 to $12.75 range, up 4% from fiscal 2019 at the midpoint. This guidance does not factor in the impact of COVID-19 on the business though management believes its business model provides the flexibility to prosper even during recessions.Oracle-ORCL reported fiscal third quarter sales increased 2% to $9.8 billion with net earnings declining 6% to $2.6 billion and EPS up 4% to $0.79. Cloud Services and License Support revenues increased 4% to $6.9 billion and accounted for nearly 71% of total revenues, up from 69% last year. Cloud License and On-Premise License revenues declined 2% to $1.2 billion. Oracle saw momentum across its applications portfolio with GAAP applications subscription revenues at $2.8 billion, up 7%. Fusion apps were up 32%. Fusion ERP was up 38% and Fusion HCM was up 27%. NetSuite ERP was up 26%. Vertical SaaS was up high-single digits and Data Cloud was up low-single digits. Operating cash flow over the last four quarters was $13.9 billion and free cash flow was $12.4 billion, or 115% of reported net income. Year-to-date, Oracle has returned $16.3 billion to shareholders through dividends of $2.3 billion and share repurchases of $14 billion. Over the last 12 months, Oracle repurchased 366 million shares for a total of $20 billion, or $54.64 per average share. And over the last five years, the company has reduced its shares outstanding by nearly 28%. The company’s board increased the authorization for share purchase by $15 billion. Oracle ended the quarter with about $26 billion in cash and investments, $49 billion in long-term debt and $15 billion in shareholders’ equity. As for the COVID-19 virus, Oracle is largely conducting business as usual with some modifications such as using video conferencing and asking employees to postpone non-essential travel. Other companies are taking precautionary actions and it's not yet clear what the effect of the virus will have on Oracle’s customers and suppliers. With that backdrop, looking ahead to the fiscal fourth quarter, total subscription revenues are expected to range between 3% to 5% with total revenue expected to range between negative 2% to positive 2%. Non-GAAP EPS is expected to grow between 3% to 9% and be between a $1.20 and $1.28.Wednesday, March 11, 2020Rowe Price Group-TROW reported preliminary assets under management (AUM) of $1.15 trillion as of February 29, 2020, down 5% from 1/31/2020. Client transfers from mutual funds to other portfolios, including trusts and separate accounts, were $0.9 billion in February 2020 and $3.7 billion for the quarter-to-date period ended February 29, 2020. At month end, AUM invested in equities represented about 80% of the total while fixed income investments, including money market funds, accounted for about 20%.Thursday, March 5, 2020Starbucks-SBUX reported that prior to the COVID-19 outbreak, China comparable store sales growth was expected to be approximately 3% in Q2 FY20, in line with Q1 FY20 results. As a result of the business disruption related to COVID-19 in China, they currently estimate that comparable store sales in China for Q2 FY20 will be down approximately 50% versus the prior year. Therefore, they expect a COVID-19-related headwind of approximately $400 million to $430 million to China’s revenue in Q2 FY20 versus prior expectations. The current estimates for China’s Q2 FY20 comparable store sales and revenue reflect the current expectation that substantially all stores in the market will be open by the end of the quarter and that traffic will improve modestly for the balance of the quarter relative to February’s swift and severe slowdown. The business disruption related to COVID-19 in China is expected to have an adverse impact to Starbucks GAAP and non-GAAP earnings per share (“EPS”) for Q2 FY20 in the range of $0.15 to $0.18. This estimate reflects the impact of expected lost sales for the period, as well as continued expenses related to partner wages and benefits, store operations and additional costs incurred in response to the COVID-19 outbreak including incremental partner-related benefits, inventory write-offs and store safety-related items. Given the planned Chinese New Year holiday and its subsequent extension, and workforce dislocation due to COVID-19, activities related to Starbucks China’s development of new stores have been temporarily paused. As a result, some store openings planned for fiscal year 2020 will likely be deferred to fiscal year 2021. While the current situation in China continues to be dynamic, management believes that the financial impacts of COVID-19 are temporary, and they remain confident in the strength of the Starbucks brand and the long-term profitability and growth potential of their business in China. As the COVID-19 situation continues to evolve globally, Starbucks business operations in Japan, South Korea and Italy have also been impacted by store closures and/or reduced customer traffic. Given the early stage of these developments, they are currently unable to forecast business impacts in markets outside of China with reasonable accuracy. They are also currently unable to estimate business impacts beyond Q2 FY20 with reasonable accuracy. Therefore, current estimate of the impact of the COVID-19 outbreak on financial performance is limited to Q2 FY20 and does not include potential business impacts in any Starbucks markets beyond China.Fastenal-FAST reported February total sales and average daily sales each increased 4.7% to $431.2 million and $21.6 million, respectively. Daily sales growth by end market was 6.2% for manufacturing and 4.9% for non-residential construction. Daily sales growth by product line was 1.6% for fasteners and 6.9% for other products. The percentage of Top 100 National Accounts growing during the month was 62% with 55% of the public branches growing during the month.Wednesday, March 4, 2020The board of directors of General Dynamics-GD declared a regular quarterly dividend of $1.10 per share on the company's common stock, payable May 8, 2020, to shareholders of record on April 10, 2020. This is the 23rd consecutive annual dividend increase authorized by the General Dynamics board, and represents a 7.8% increase over last year's dividend.The board also provided management with the authority to repurchase an additional 10 million shares of the company's issued and outstanding common stock on the open market.Brown-Forman-BFB reported fiscal third quarter sales dipped slightly to $899 million with net income and EPS increasing 2% to $227 million and $0.47, respectively. For the nine months ended 1/31/2020, sales increased 3% to $2.7 billion with net income increasing 3% to $699 million and EPS increasing 4% to $1.45. Gross margins declined 220 basis points to 63.1%, squeezed by higher agave and wood prices and tariff costs. Year-to-date sales growth was led by 6% growth in the U.S., which represents half of Brown-Forman’s sales, driven by continued double-digit growth from Old Forester and Herradura, premium brands that both recently celebrated 150-year anniversaries, and Woodford Reserve, the launch of Jack Daniel’s Tennessee Apple and double-digit underlying net sales growth in el Jimador. Sustained double-digit growth of Jack Daniels ready-to-drink (RTDs) beverages also contributed to the domestic sales growth. Underlying net sales in the company’s emerging markets grew 6%, or 4% reported, reflecting volume gains for the Jack Daniel’s family of brands. Russia delivered strong underlying net sales growth up 15%, Poland’s underlying net sales improved in the quarter to 6%, Brazil grew underlying net sales by 6% while Mexico’s underlying net sales growth moderated to 2% due to the weak economy. Developed international markets grew underlying net sales 2% as strength in Germany (up 5%) and France (up 3%) was partially offset by a 7% decline in the UK, impacted by softness in the cash and carry channel and short-term disruptions from changes in promotional strategy and upcoming route-to-market transition to Brown-Forman’s complete control slated for May 2020. Year-to-date free cash flow declined 14% to $425 million with the company returning $243 million to shareholders through share repurchases of $1 million and dividend payments of $242 million. Brown-Forman has paid dividends for 74 consecutive years and has increased its dividend for 36 consecutive years, including the 5% increase delivered in fiscal 2020. The company ended the quarter with $276 million in cash, $2.3 billion in debt and $2.0 billion in shareholders’ equity. Given lower expectations in some international markets, reflecting both short-term disruptions and an increasingly uncertain global economic and political environment coupled with uncertainty surrounding the impact of COVID-19, the company tempered its outlook for the full fiscal 2020 year. Underlying sales growth is now expected in the low-single digits, down from prior guidance of 5% to 7% growth. Operating income is expected to be flat to slightly negative, down from previous guidance of up 2% to 4% and EPS are now expected to be in the $1.70 to $1.80 range, down from prior guidance of $1.75 to $1.80. On the conference call, Lawson Whiting, president and CEO, stated that since its founding in 1870, Brown-Forman has ably navigated through world wars, prohibition, the Great Depression and the Great Recession by focusing on building the business and its strong brands for the long-term, a continuing management focus despite the heavy near-term headwinds. Tuesday, March 3, 2020Ross Stores-ROST reported fourth quarter revenues rose 8% to $4.4 billion with comp store sales up 4%, net income up 3% to $456.1 million and EPS up 7% to $1.28. For the full year, revenues rose 7% to $16.0 billion, with same store sales up 3%, net income up 5% to $1.7 billion and EPS up 8% to $4.60. Return on shareholders’ equity for the year was a very dressy 49.4%. Free cash flow dipped 2% t $1.6 billion due to higher capital expenditures. During the year, the company paid $370 million in dividends and repurchased $1.275 billion of stock. Ross Stores expects to repurchase an additional $1.275 billion of stock in fiscal 2020. The Board also recently increased the dividend 12%. The increases in shareholder payouts for 2020 reflect management’s ongoing confidence in the company’s ability to generate significant amounts of cash after funding their growth and other capital needs of the business. Ross Stores has repurchased stock as planned every year since 1993 and raised their dividend annually every year since 1994. For fiscal 2020, Ross is planning to open 100 new stores, 75 Ross Stores and 25 dd Discounts locations, leading to sales growth of 4%-5%, with same store sales growth of 1%-2% and EPS in the range of $4.67-$4.88 with operating margins contracting 20 basis points due to tariffs. This guidance does not reflect the potential unknown impacts from the evolving coronavirus outbreak. There remains a high level of uncertainty over supply chain disruptions in China. It also is unclear how a further spread of the coronavirus could negatively impact U.S. consumer demand.Monday, Mar. 2, 2020Alphabet’s-GOOGL autonomous driving company, Waymo, announced that it has closed its first round of external investment and raised $2.25 billion in financing from investors including Silver Lake, the Canada Pension Plan Investment Board, and Abu Dhabi’s sovereign wealth fund Mubadala Investment Company. Other firms including Andreessen Horowitz, global automotive supplier Magna International, pre-owned vehicle listing service AutoNation, and Alphabet also participated in Waymo’s round. Waymo did not say, precisely, what it will do with its newfound cash, but it did share a number of development and business milestones. The company says its autonomous Waymo Driver platform has driven “more than 20 million miles on public roads across over 25 cities, and over 10 billion miles in simulation.” Waymo added that the company has already shipped its first L4 autonomous vehicles (which include electric vehicles and Class 8 trucks, according to the company) which include the company’s latest hardware and beefed onboard sensors and compute hardware. The company also provided updates about Waymo One, its on-demand autonomous car service which currently operates in Arizona. The service has already provided thousands of trips to locals “in a high-speed mixed usage market area larger than San Francisco.” Wednesday, Feb. 26, 2020The TJX Companies-TJX rang up a 10% increase in fiscal fourth quarter sales to $12.2 billion with net income increasing a fashionable 17% to $985 million and EPS increasing, a greater than expected, 19% to $0.81. Fourth quarter consolidated comparable store sales increased a very strong 6%, over a 6% increase last year, driven by customer traffic. Each division delivered strong comp sales growth with Marmaxx delivering 5% comp growth on top of 7% growth last year, HomeGoods delivering 2% comp growth on top of 4% last year, TJX Canada delivering 2% comp growth on top of 4% last year and TJX International delivering 8% comp growth on top of 3% last year. For the full fiscal 2020 year, TJX reported sales increased 7% to $41.7 billion, surpassing its long-held sales goal of $40 billion, with net income up 7% to $3.3 billion and EPS increasing 10% to $2.67. Same store sales increased 4% over a 6% increase last year, marking TJX’s 24th consecutive year of comp store growth. While other retailers closed thousands of brick & mortar stores, TJX opened 223 new stores during fiscal 2020, ending the year with 4,529 stores and 120.7 million gross square feet, up 4% from last year. During fiscal 2020, TJX generated a fancy 55% return on shareholders’ equity and $2.8 billion in free cash flow. TJX returned $2.6 billion to shareholders during fiscal 2020 through share repurchases of $1.5 billion at an average cost per share of $55.35 and dividends of $1.1 billion. Given the company’s continued strong cash flow, the board raised the dividend by 13%, marking the 24th consecutive year of dividend increases. With $1.7 billion remaining under the current share repurchase authorization, the directors approved a new $1.5 billion share repurchase authorization, the 21st program approved since 1997. For fiscal 2021, the company expects EPS in the range of $2.77 to $2.83, up 4% to 6% from fiscal 2020. This guidance is based on estimated comp store sales growth of 2% to 3%. The company has not yet seen impact from the coronavirus. While it is too early to speculate about future impact from the virus, safety of TJX associates is management’s top priority. For now the company has modified travel for associates to keep them safe.Booking Holdings-BKNG reported fourth quarter revenues rose 4% to $3.3 billion with net income flying 81% higher to $1.2 billion and EPS doubling to $27.75. Earnings included unrealized gains on equity investments in the fourth quarter compared to unrealized losses in the prior year period. On an adjusted basis, net income declined 6% in the fourth quarter. For the full year 2019, revenues rose 4% to $15.1 billion with net income up 22% to $4.9 billion and EPS up 34% to $111.82. On an adjusted basis, net income was comparable to the prior year. Booked nights increased 20% during the year to 845 million room nights, translating into 2.3 million room nights booked each day. Return on shareholders’ equity expanded to an impressive 82% in 2019. Free cash flow declined 8% during the year to $4.5 billion with the company repurchasing $8.2 billion of common stock during the year, including $1.3 billion in the fourth quarter. The company has $11.5 billion remaining authorized for future share repurchases. The coronavirus has had a significant and negative impact across Booking’s business during the first quarter of 2020 as cancellations have increased and new bookings have slowed as consumers curtail their travel plans. It is not possible to predict where, and to what degree, outbreaks of the coronavirus will disrupt travel patterns. Recognizing the situation is very fluid, Booking’s guidance for the first quarter is wide due to the great uncertainty. Total room nights booked are expected to decline 5% to 10% in the first quarter with total gross travel bookings down 10% to 15%. Revenues are expected to decline 3% to 7% in the first quarter with EPS expected to decline 12% to 17% to a range of $7.95 to $8.55. Despite the temporary headwinds facing the company, management is very confident in the long-term growth of their business. Tuesday, Feb. 25, 2020Mastercard-MA reported that the fundamentals of their business remain strong, as switched volume and switched transaction growth remain in-line with expectations. However, cross-border travel, and to a lesser extent cross-border e-commerce growth, is being impacted by the Coronavirus. As a result, they now expect that if the trends they have seen recently -- primarily in cross-border drivers -- continue through the end of the quarter, year-over-year net revenue growth in the first quarter will be approximately 2-3 percentage points lower than discussed on their January 29, 2020 earnings call. Under these circumstances, they would expect year-over-year net revenue growth of 9-10% in the first quarter on a currency-neutral basis, excluding acquisitions. There are many unknowns as to the duration and severity of the situation and they are closely monitoring it. If the impact is limited to the first quarter only, they expect that their 2020 annual year-over-year net revenue growth rate would be at the low end of the low-teens range, on a currency-neutral basis, excluding acquisitions.In separate news, Mastercard announced that Ajay Banga, President and Chief Executive Officer, will transition to the role of Executive Chairman of the Board of Directors of Mastercard Incorporated on January 1, 2021. Mastercard’s Board unanimously elected Michael Miebach, Chief Product Officer, to become Chief Executive Officer and a member of the Board of Directors on January 1, 2021 and, as part of the transition, he will become President of the company, effective March 1, 2020. As President of the company, Miebach will oversee the sales, marketing, products, services and technology organizations. Monday, Feb. 24, 2020Berkshire Hathaway-BRKB reported the company’s net worth during 2019 rose 22% with book value equal to $261,417 per Class A share as of 12/31/19.During the year, Berkshire reported net earnings of $81.4 billion compared to $4.0 billion in the prior year period. New accounting rules in 2018 require Berkshire to include the changes in unrealized gains/losses of its equity security investments in net income instead of comprehensive income which resulted in a $57.4 billion gain in 2019 from investments and derivatives compared to a $17.7 billion loss in the prior year period.Berkshire’s five major investment holdings represent 67% of total equities, including American Express at $18.9 billion (up 30% during 2019 or $4.4 billion), Apple at $73.7 billion (up 82% during 2019 or $33.4 billion), Bank of America at $33.4 billion (up 48% during 2019 or $10.8 billion), Coca-Cola at $22.1 billion (up 17% during 2019 or $3.2 billion) and Wells Fargo at $18.6 billion (down 10% or $2.1 billion).Berkshire’s operating revenues increased 2.6% in 2019 to $254 billion with growth in all business segments except BNSF which remained relatively flat. Operating earnings declined 3% during 2019 to $24 billion due primarily to lower insurance underwriting as earnings from primary insurance operations were lower in 2019 and losses from reinsurance were higher than in 2018.During 2019, Berkshire’s operating earnings in the insurance underwriting operations dropped to $325 million compared to $1.6 billion in the prior year. On the other hand, insurance investment income was 21% higher at $5.5 billion during the year, reflecting higher interest rates on short-term investments and higher dividend income due to increases in the portfolio of equity securities, including the August 8, 2019 investment in Occidental 8% preferred stock, and higher dividend rates. The float of the insurance operations approximated $129 billion as of 12/31/19, an increase of $6 billion during the year. The average cost of float was negative during the year as the underwriting operations generated pre-tax earnings of $400 million. Berkshire’s insurance operations have had an excellent underwriting record generating underwriting profits in 16 of the last 17 years with the cumulative pre-tax gain in the 17-year period totaling $27.5 billion.Burlington Northern Santa Fe’s (BNSF) revenues declined 1% during 2019 to $23.5 billion with net earnings chugging 5% higher to $5.5 billion thanks to higher rates per car/unit and ongoing cost controls. Aggregate volume was 10.2 million cars/units, representing a 4.5% decrease in volume from last year. BNSF experienced severe winter weather and flooding on parts of its network in the first half of 2019, which negatively affected revenues, expenses and service levels. Reduced consumer demand, trade policy, higher available truck capacity and lower international intermodal market share also impacted volume.Berkshire Hathaway Energy reported revenues increased slightly to $20 billion during 2019 due to growth at the real estate brokerage unit that was mostly offset by lower revenue of the energy units. Net earnings increased 8% during the year to $2.8 billion with all business segments contributing to the earnings growth.Berkshire’s Manufacturing businesses reported a 1% increase in revenue growth in 2019 to $62.7 billion with operating earnings up 2% to $9.5 billion. Revenue and earnings growth were led by Building Products with 9% revenue growth to $20.3 billion and 13% growth in operating earnings to $2.6 billion, thanks to 22% growth at Clayton Homes, reflecting increased home sales and changes in sales mix. Industrial Products revenues were relatively unchanged at $30.6 billion with Consumer Products revenues declining 6% to $11.8 billion primarily due to a 13% decline in Forest River unit sales.Service and Retailing revenues rose 1% during the year to $80.0 billion with pre-tax earnings down 3% to $2.8 billion. Revenues rose modestly in all business segments with earnings down 8% in the Service segment due to lower earnings from FlightSafety and TTI. FlightSafety experienced significant losses on a government contract in the fourth quarter. TTI was challenged by lower gross margin, higher operating expenses and foreign exchange headwinds. The decline in Service earnings was partly offset by growth in operating earnings in the Retailing and McLane segments.Berkshire’s balance sheet continues to reflect significant liquidity and a strong capital base of $424.8 billion as of 12/31/19, an increase of $76.1 billion since last year, and unmatched in corporate America. Excluding railroad, energy and utility investments, Berkshire ended the year with $409 billion in investments allocated approximately 60.6% to equities ($248 billion), 4.6% to fixed-income investments ($18.7 billion), 4.3% to equity method investments ($17.5 billion), and 30.5% in cash and equivalents ($125 billion).Berkshire’s investments are heavily tilted toward equities, especially for an insurance company. In the annual report, Warren Buffett explains, “If something close to current rates should prevail over the coming decades and if corporate taxes also remain near the low level businesses now enjoy, it is almost certain that equities will over time perform far better than long-term, fixed-rate debt instruments. Occasionally, there will be major drops in the market, perhaps of 50% magnitude or even greater. But the combination of the American Tailwind and compounding wonders will make equities the much better long-term choice for the individual who does not use borrowed money and who can control his or her emotions. “Berkshire’s financial strength allows Buffett to make significant investments and acquisitions, although there was minimal activity during 2019. During the year, Berkshire closed on the deal to invest a total of $10 billion in Occidental Petroleum in connection with Occidental’s proposal to acquire Anadarko Petroleum. Berkshire’s investment includes newly issued Occidental Cumulative Perpetual Preferred Stock with an aggregate liquidation value of $10 billion, together with warrants to purchase up to 80 million shares of Occidental common stock at an exercise price of $62.50 per share. The preferred stock will accrue dividends at 8% per annum and will be redeemable at the option of Occidental commencing on the tenth anniversary of issuance. In addition, about $1.7 billion was invested in bolt-on acquisitions.Free cash flow was relatively unchanged for the year at $22.7 billion. During 2019, capital expenditures increased 10% to $16 billion, including $11 billion in the capital-intensive railroad, utilities and energy businesses. Berkshire expects additional capital expenditures to approximate $10.6 billion for BNSF and Berkshire Hathaway Energy in 2020. Reinvestment in productive operational assets will remain the company’s top priority. During 2019, Berkshire sold or redeemed a net $17.6 million in Treasury Bills and fixed-income investments and bought a net $4.3 billion of equity securities.Berkshire revised its buyback policy which now permits Berkshire to repurchase shares at prices below Berkshire’s intrinsic value, as conservatively determined by Warren Buffett and Charlie Munger. During 2019, Berkshire repurchased about $5 billion of its common stock, representing about 1% of the company. These repurchases included 953,070 Class B shares at an average price of $221.67 and 674 Class A shares at an average price of $333,298 per share during December 2019. We would expect further share repurchases given Berkshire’s current attractive valuation.In an interview subsequent to the release of the annual report, Buffett acknowledged that it is difficult to repurchase Berkshire shares since there are so many long-term shareholders unwilling to part with their shares. Buffett has offered anyone with a $20 million or more block of Berkshire and inclined to sell it to call Berkshire.In the same interview, Buffett was asked about the impact of the coronavirus on Berkshire’s businesses. Many of the roughly 1,000 Dairy Queens in China are closed, while those that are open "aren't doing any business to speak of," Buffett said, while Johns Manville insulation and Shaw carpeting have seen supply chain disruptions. In addition, his 5.6% holding in Apple and significant investment holdings in the airline stocks also are feeling the negative impact of the virus. However, Buffett noted that he buys businesses to hold for 20-30 years, and his positive outlook for these businesses has not changed due to the coronavirus. Buffett concluded that the coronavirus is “scary stuff” but it won’t cause him to sell any stocks. If stock market prices drop, it makes valuations appear more attractive, and Buffett is eager to buy more stocks and businesses with his $125 billion in cash. Thursday, Feb. 20, 2020 Hormel Foods-HRL reported fiscal first quarter sales increased 1% to $2.4 billion with net income up slightly to $243 million and EPS up 2% to $0.45. Volume of 1.2 billion pounds declined 1%, and increased 2% organically excluding the impact of the April 2019 CytoSport divestiture. Organic sales growth of 4% was driven by volume and sales growth in three of Hormel’s four segments. By segment, Refrigerated Foods sales increased 6% to $1.4 billion on a 3% volume increase, thanks to strong demand for value added products including Hormel® Bacon 1TM fully cooked bacon, Hormel® Fire BraisedTM products, Hormel® Black Label® bacon Hormel® Cure 81® ham and deli sales of Hormel® Gatherings® party trays and Applegate® branded items. Grocery Products sales declined 11% to $541 million on a 14% decline in volume, primarily due to the CytoSport divestiture. On an organic basis, growth from the SPAM® family of products and Wholly® guacamole dips did not offset declines from SKIPPY® products. Volatile pork and beef trim prices impacted profitability across many product lines in Grocery Products. Jennie-O Turkey Store delivered a second consecutive quarter of volume and sales growth--8% and 3%, respectively--as the company works to regain ground turkey distribution in the aftermath of the 2018 recall. International sales increased 5% to $162 million on a 5% volume increase. During the quarter, Hormel generated $131 million in free cash flow, down 26% year-over-year due to an inventory build in anticipation of ramping up new production facilities and a related jump in capital expenditures. The company recently paid its 366th consecutive quarterly dividend at the annual rate of $0.93 per share, an 11% increase over the prior year. Hormel announced it has agreed to acquire Sadler's Smokehouse, one of Hormel’s trusted suppliers for over two decades with about $140 million in sales. The $270 million acquisition is expected to close in March 2020 and is expected to be neutral to slightly negative to fiscal 2020 earnings. Hormel ended the quarter with nearly $740 million in cash and investments, $309 million in long-term debt and $6.5 billion in shareholder equity. During the conference call management stated that it has started to see a negative impact on its business in China from the coronavirus outbreak, especially in its food service business as many restaurants have closed. Many of Hormel’s production facilities have yet to reopen after the Chinese New Year as employees who are no longer quarantined lack transportation. Negative effects of the virus have been partially offset by stronger demand for grocery products like Spam. While the full impact of the coronavirus is unknowable, management expects strong momentum in Refrigerated Foods and Jennie-O Turkey Store will offset declines in its International segment. The company reaffirmed its 2020 guidance with sales expected in the $9.5 billion to $10.3 billion range and EPS in the $1.69 to $1.83 range, compared with 2019 sales and EPS of $9.5 billion and $1.80, respectively. Wednesday, Feb. 19, 2020Genuine Parts-GPC reported fourth quarter sales increased 2.2% to $4.7 billion with net income and EPS skidding 95% lower to $8.9 million and $0.06, respectively. The decline in earnings was due to restructuring charges and the writeoff of goodwill in the Business Products segment. Restructing charges of $112 billion are expected to generate annual savings run rates of $100 million by the end of 2020. Excluding the impact of restructuring and goodwill writeoffs, net income dipped 1% to $197 million and EPS were flat at $1.35. Total sales included 0.5% comparable growth and about 6.7% from acquisitions, offset by a 4.2% decline due to the sale of EIS, Inc and Grupo Auto Todo and a 0.8% negative impact from foreign currency. Fourth quarter sales for the Automotive Group were up 8.7% to $2.8 billion including a 3% comparable sales increase, a 7% net benefit from acquisitions, divestitures and other adjustments and unfavorable foreign currency of 1.4%. Sales for the Industrial Group were down 6% to $1.5 billion, including a 1.2% comparable sales decrease and a 12.3% decrease due to the sale of EIS, partially offset by a 7.6% increase from acquisitions. Sales for the Business Products Group were down 6.3% to $428 million. For the year, GPC reported record sales of $19.4 billion, up 3.5% year-over-year, with net income and EPS falling 23% to $621 million and $4.24, respectively. Adjusted net income was $833.2 million, or $5.69 per share, down slightly from last year. During 2019, GPC generated a nearly 17% return on shareholder equity. The company generated $594 million in free cash flow, down 35% on the lower net income and higher capital expenditures as the company continues to invest in its people, IT, and cybersecurity. The company returned $513 million to shareholders during 2019 through share repurchases of $74 million and dividends of $439 million. The board announced the company’s 64th consecutive year of dividend increases, raising the 4% dividend to $3.16 per share for 2020. The company expects to actively pursue share repurchases during 2020 and believes its stock is an attractive investment. GPC ended the year with $277 million in cash, $2.8 billion in debt with an average interest rate of 2.2%, and $3.7 billion in shareholders’ equity. While the coronavirus is a fluid situation, at the current time, management sees no sales weakness related to the virus as none of its sales come from China, although it does generate sales throughout Asia. However, GPC has both direct and indirect supply chain exposure to China. While management does not foresee material product shortages, it is in constant contact with suppliers across the globe to plan for any supply disruptions should the virus outbreak extend beyond the near-term. For 2020, sales are expected to be flat to up 1%, or up an adjusted 3% to 4% excluding the impact of the EIS and SPR Canada divestitures. EPS are expected in the $5.80 to $5.90 range, an increase of 2% to 4%, or an adjusted 5% to 7% excluding the divestitures.Tuesday, Feb. 18, 2020As a result of a slower return to normal conditions in China due to the coronavirus, Apple-AAPL does not expect to meet the revenue guidance they provided for the March quarter due to two main factors. The first is that worldwide iPhone supply will be temporarily constrained. While iPhone manufacturing partner sites are located outside the Hubei province — and while all of these facilities have reopened — they are ramping up more slowly than anticipated. These iPhone supply shortages will temporarily affect revenues worldwide. The second is that demand for Apple products within China has been affected. All Apple stores in China and many partner stores have been closed. Apple is gradually reopening retail stores and will continue to do so as steadily and safely as they can. Stores that are open have been operating at reduced hours and with very low customer traffic. Outside of China, customer demand across product and service categories has been strong to date and in line with expectations. The situation continues to evolve. Apple is fundamentally strong, and this disruption to the business is only temporary.Genuine Parts Company-GPC announced a 4% increase in the regular quarterly cash dividend for 2020. The Board of Directors of the Company, at its February 17, 2020 Board meeting, increased the cash dividend payable to an annual rate of $3.16 per share compared with the previous dividend of $3.05 per share. GPC has paid a cash dividend every year since going public in 1948, and 2020 marks the 64th consecutive year of increased dividends paid to shareholders.Thursday, Feb. 13, 2020The UPS-UPS Board of Directors increased its regular quarterly dividend 5% to $1.01 per share on all outstanding Class A and Class B shares. The dividend is payable March 10, 2020 to shareowners of record on Feb. 25, 2020. For nearly 50 years, UPS has either increased or maintained its dividend. Since 2000, UPS’s dividend has more than quadrupled.PepsiCo-PEP reported fourth quarter revenues rose 6% to $20.6 billion with operating profit popping 11% higher to $2.7 billion. Fourth quarter net income and EPS each dropped 74% to $1.8 billion and $1.26, respectively, due to tax changes. For the full 2019-year, revenue rose 4% to $67.2 billion with operating income up 2% to $10.3 billion. Full year 2019 net income and EPS each declined 41% to $7.3 billion and $5.20, respectively, due to tax changes with 7% core constant currency EPS growth. Organic revenue growth accelerated to 4.5% for the full year with revenue growth broad-based across business segments and geographies as the company increased its brand support, strengthened operational execution and built a more sustainable food system. Return on shareholders’ equity during 2019 was a tasty 49.4%. Free cash flow declined 12% during the year to $5.4 billion primarily due to increased capital expenditures to support future growth. During 2019, PepsiCo paid $5.3 billion in dividends and repurchased $3 billion of common stock. The company announced a 7% increase in its annualized dividend to $4.09 for 2020, representing the 48th consecutive year of dividend increases. In 2020, PepsiCo expects full organic revenue growth to be 4% with constant currency EPS growth of 7%. The company expects to generate $11 billion in cash flow from operations and $6 billion of free cash flow which assumes net capital spending of about $5 billion. Capital spending is expected to be in the $5 billion range annually over the next few years as the company invests to support future long-term growth. Total cash returns to shareholders in 2020 are expected to approximate $7.5 billion comprised of dividends of $5.5 billion and share repurchases of $2 billion.Wednesday, Feb. 12, 2020Cisco Systems-CSCO reported fiscal second quarter revenues declined 4% to $12 billion with net income up 2% to $2.9 billion and EPS up 8% to $.68. Product revenue declined 6% during the quarter with service revenue up 5%. Product revenue was led b growth in Security that was up 9% with Infrastructure Platforms and Applications each down 8%. Cisco reported that 72% of revenue is now subscription-based and was up 7% during the quarter. Revenue by geographic segments was weak around the globe due to macro headwinds. Free cash flow dipped 1% during the first half of the fiscal year to $7.0 billion with the company paying $3 billion in dividends and repurchasing $1.6 billion of common stock, including 18 million shares in the second quarter for $870 million at an average cost of about $46.71 per share. Cisco has $11.8 billion remaining authorized for future share repurchases with no termination date. Cisco increased the quarterly dividend 3% to $.36 per share, bringing the current dividend yield close to 3%. For the fiscal third quarter, Cisco expects revenues to decline between 1.5% to 3.5% with EPS expected to declined to the range of $.62 to $.67.T. Rowe Price Group-TROW reported preliminary month-end assets under management of $1.21 trillion as of January 31, 2020, representing a 0.4% increase since year end. T. Rowe Price Group, Inc. announced that its Board of Directors has declared a quarterly dividend of $0.90 per share payable March 30, 2020 to stockholders of record as of the close of business on March 16, 2020. The quarterly dividend rate represents a 18.4% increase over the previous quarterly dividend rate of $0.76 per share. This will mark the 34th consecutive year since the firm's initial public offering that the company will have increased its regular annual dividend.Tuesday, Feb. 11, 2020Johnson & Johnson-JNJ announced that its Janssen Pharmaceutical Companies will further expedite its investigational coronavirus vaccine program through an expanded collaboration with the Biomedical Advanced Research and Development Authority (BARDA), part of the Office of the Assistant Secretary for Preparedness and Response (ASPR) at the U.S. Department of Health & Human Services. The collaborative partnership with BARDA builds on Johnson & Johnson's multipronged response to the new coronavirus disease (COVID-19) outbreak. In addition to Janssen's efforts to develop a vaccine candidate, the Company is working closely with global partners to screen its library of antiviral molecules to accelerate the discovery of potential COVID-19 treatments and provide relief for people in China and around the world.Thursday, Feb. 6, 2020Cognizant Technology Solutions-CTSH reported fourth quarter revenues increased 3.8% to $4.3 billion with net earnings declining 39% to $395 million and EPS declining 38% to $0.72. The earnings reflect $101 million of realignment and restructuring costs. On an adjusted basis, EPS increased 9.2% year-over-year to $1.07. By business segment, Financial Services revenues increased 1.2% to $1.5 billion driven primarily by insurance. Healthcare revenues increased 1.6% to $1.2 billion driven by double-digit growth in life sciences and the acquisition of Zenith Technologies. Products and Resources revenue grew 8.1% to $963 million reflecting demand for core modernization services of enterprise applications and for services within Digital Business. Communications, Media and Technology revenues increased 8.0% to $632 million with broad-based growth across all the industries. For the full year, revenues increased 4.1% to $16.8 billion with net income down 12% to $1.8 billion and EPS down 8.6% to $3.29. Return on shareholders’ equity was 16.7%. Free cash flow declined 4.9% to $2.0 billion with the company paying $453 million in dividends and repurchasing $2.2 billion of its shares. For 2020, management expects revenue growth in the range of 2.%0-4.0% in constant currency and adjusted EPS in the range of $3.97-4.13. In addition, management announced a 10% increase to its cash dividend and increased its share repurchase authorization by $2.0 billion. Maximus-MMS reported fiscal first quarter revenues rose 23% to $818.2 million with net income up 5% to $58.7 million and EPS up 6% to $.91. Revenue growth was driven by the expected increases in the U.S. Federal Services segment due to a full quarter contribution from the acquired citizen engagement centers business, the expected ramp up on the Census contract and organic growth in the U.S. Health & Human Services and U.S. Federal Services segments. Operating margin declined to 9.7% from 11.2% due to a greater mix of cost-plus contracts from the federal acquisition and continue weakness in the employment services business in the Outside the U.S. segment. The impact from the bush fires in Australia and the coronavirus are estimated to negatively impact EPS by $.07-$.15 as tourism hiring is expected to slow. Free cash flow increased 56% during the first quarter to $76.8 million with the company paying $17.9 million in dividends and repurchasing 26,000 shares for $1.9 million at an average cost of $73 per share. The company’s capital allocation priority is mergers and acquisitions that drive long-term, sustainable growth and then opportunistic share repurchases and the payment of dividends. Year-to-date signed contract awards at 12/31/19 totaled $176.6 million with contracts pending of $439.5 million. The sales pipeline at 12/31/19 was $30.6 billion comprised of approximately $3.7 billion in proposals pending, $.7 billion in proposals in preparation and $26.3 billion in opportunities tracking. Maximus reiterated its fiscal 2020 revenue and earnings guidance with revenue expected to range between $3.15 billion and $3.30 billion and EPS in the range of $3.95 and $4.15. Free cash flow for fiscal 2020 is expected in the range of $275 million to $325 million.NIKE-NKE announced it is transitioning its Nike Brand business in Brazil, Argentina, Chile and Uruguay to strategic distributor partnerships, enabling a more profitable, capital efficient and value accretive business model. This move demonstrates Nike’s ongoing approach to optimize country operating models across its global portfolio, with sharpened focus and investment against its biggest growth opportunities through the Consumer Direct Offense. As a result of the transactions, during the third quarter of fiscal 2020, NIKE will classify the assets and liabilities of the entities to be sold as held for sale on the Consolidated Balance Sheet and will recognize a one-time, non-recurring charge related to foreign exchange of approximately $425 million. Fastenal-FAST reported January net sales and daily sales each increased 3.6% to $462.8 million and $21.0 million, respectively. Daily sales growth by end market was 4.3% in manufacturing and 3.2% in non-residential construction. Daily sales growth by product line was 1.3% for fasteners and 4.9% for other products. About 60% of the Top 100 national accounts grew during the month with 55% of the public branches growing.Wednesday, Feb. 5, 2020Private sector employment increased by 291,000 jobs from December to January according to the January ADP National Employment Report®. "The labor market experienced expanded payrolls in January," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "Goods producers added jobs, particularly in construction and manufacturing, while service providers experienced a large gain, led by leisure and hospitality. Job creation was strong among midsized companies, though small companies enjoyed the strongest performance in the last 18 months." Mark Zandi, chief economist of Moody's Analytics, said, "Mild winter weather provided a significant boost to the January employment gain. The leisure and hospitality and construction industries in particular experienced an outsized increase in jobs. Abstracting from the vagaries of the data underlying job growth is close to 125,000 per month, which is consistent with low and stable unemployment."The 3M -MMM Board of Director declared a dividend on the company’s common stock of $1.47 per share for the first quarter of 2020, an increase of 2 percent over the quarterly dividend paid in 2019. The dividend is payable March 12, 2020, to shareholders of record at the close of business on Feb. 14, 2020. This marks the 62nd consecutive year 3M has increased its dividend. The company has paid dividends to its shareholders without interruption for over 100 years. During the past decade, 3M has returned $57 billion to shareholders through a combination of dividends and gross share repurchases, or 121 percent of reported net income.Tuesday, Feb. 4, 2020Disney-DIS reported fiscal first quarter revenues rose 36% to $20.9 billion with segment operating income up 9% to $4 billion. Net income from continuing operations declined 23% to $2.1 billion with EPS down 37% to $1.17, impacted by amortization and restructuring charges related to acquisitions. By business segment, Media Networks revenue rose 24% to $7.4 billion with operating income up 23% to $1.6 billion thanks to the consolidation of the Fox and National Geographic networks. Parks, Experiences and Products revenues increase 8% during the quarter to $7.4 billion with operating income up 9% to $2.3 billion due to higher guest spending at the domestic parks and higher merchandise licensing. Parks in Hong Kong and China are expected to be negatively impacted in the second quarter and for the balance of the year by closures due to the coronavirus. Studio Entertainment revenues and operating income more than doubled to $3.8 billion and $948 million, respectively, thanks to greater than $1 billion in revenues from the performance of both Frozen II and Star Wars: The Rise of Skywalker. Direct-to-Consumer and International revenues more than doubled to nearly $4 billion with the operating loss widening to $693 million from $136 million due to the costs associated with the launch of Disney+, the consolidation of Hulu and a higher loss at ESPN +. The launch of Disney+ has exceeded management’s expectations with 26.5 million paid subscribers as of quarter end thanks to the company’s great brands and content. Paid subscribers has increased an additional 2.1 million since quarter end to 28.6 million. ESPN+ ended the quarter with 6.6 million paid subscribers while Hulu ended the quarter with 30.4 million paid subscribers. Free cash flow declined 68% during the quarter to $292 million, reflecting the lower earnings and higher capital expenditures.NIKE-NKE has temporarily closed approximately half of NIKE-owned stores in China due to the coronavirus with corresponding dynamics across partner stores. In addition, they are operating with reduced hours and experiencing lower than planned retail traffic in stores that do remain open. In the short term, Nike expects the situation to have a material impact on their operations in Greater China.Monday, Feb. 3, 2020Alphabet-GOOGL reported fourth quarter revenues rose 17% to $46.1 billion with net income up 19% to $10.7 billion and EPS up 20% to $15.35. Double-digit growth was broad based across business segments and geographies. For the full 2019-year, revenue rose 19% to $161.9 billion with net income up 12% to $34.3 billion and EPS up 13% to $49.16. Google Search revenues increased 15% to $98.1 billion, YouTube ads jumped 36% to $15.1 billion with Google Cloud revenues skyrocketing 53% higher to $8.9 billion. Google other revenues increased 21% to $17 billion. Return on shareholders’ equity was 17.4% in 2019. Free cash flow increased 36% during the year to $31 billion. Alphabet continued to heavily invest in capital expenditures of $23.5 billion for technology infrastructure and datacenters to support growth in artificial intelligence, ambient computing and cloud computing. Employee headcount increased 20% during the year to 118,899 Googlers with most of the new hires being engineers. Capital expenditure and employee growth is expected to be higher in 2020 as the company invests for the long term. During the year, Alphabet used excess cash to repurchase $18.4 billion of common stock including $6.1 billion in the fourth quarter. The company has $21 billion remaining authorized for future share repurchases. Alphabet ended the year with a fortress balance sheet with nearly $120 billion in cash and investments, $4.6 billion in long-term debt and $201 billion in shareholders’ equity. The company’s capital allocation strategy continues to be 1) invest in current businesses to support future growth, 2) acquisitions and 3) share buybacks.Friday, Jan. 31, 2020Gentex- GNTX reported fourth quarter sales declined 2% to $443.8 million with net income skidding 6% to $99.5 million and EPS falling 4.8% to $0.39. The revenue decline was due, in large part, to the strike at General Motors, which negatively impacted sales in the quarter by about 5%. In addition to the strike creating domestic headwinds, the rest of the world light vehicle production declined 5%, including a 6% production decline in Europe and a 10% production decline in the Japan/Korea market that more than offset modest improvement in the China market. Fourth quarter gross profit declined 140 basis points from last year to 36.5%, squeezed by the GM strike (125 basis points) and tariff headwinds (30 basis points). Absent these one-offs, profit margins would have increased year-over-year. For the full year, Gentex reported sales crawled ahead 1% to $1.86 billion with net income dipping 3% to $424.7 million and EPS increasing 2.5% to $1.66 on fewer shares outstanding. Gentex shipped 42.9 million auto-dimming mirrors during 2019, up 3% from last year, including 739,000 full display mirrors (FDMs) compared to 390,000 FDMs shipped in 2018. During 2019, Gentex generated an impressive 21.9% return on shareholders’ equity and $421.4 million in free cash flow, down 10% from last year on the lower net income and working capital fluctuations. Gentex repurchased 13.8 million shares during 2019 at an average cost of $24.06 per share ending the year with 20.1 million shares remaining under the current share repurchase authorization. Gentex ended the year with $577 million in cash and investments and no long-term debt on its high-octane balance sheet. Looking ahead to 2020, based on an estimated 1% decline in global light vehicle production, Gentex expects sales in the $1.91 to $2 billion range, up 5% at the midpoint and profit margins between 36% to 37%, which includes a $20 million hit from tariffs. Sales growth will be driven by increased penetration rates of Gentex’s core mirror products, continued growth of FDM sales and launches of the new Integrated Toll Module product. Gentex remains committed to investing heavily in new technology in the areas of vision systems, connected car and dimmable glass. Gentex’s entrance into a new sales vertical with the introduction of its intelligent medical lighting application developed in partnership with Mayo Clinic will likely add to revenue growth for many years to come.Thursday, Jan. 30, 2019Biogen-BIIB reported fourth quarter revenues increased 4% to $3.7 billion with net income up 52% to $1.44 billion and EPS up 71% to $8.08. Excluding acquisition, restructuring and tax reform related items, adjusted earnings increased 6% to $1.5 billion and EPS increased 19% to $8.34. For the year, Biogen reported a healthy 7% increase in sales to $14.4 billion with net income increasing 33% to $5.9 billion and EPS increasing 46% to $31.42. Excluding special items, net income increased 17% to $6.3 billion and EPS increased 28% to $33.57. Full year sales growth was driven by growth in all the company’s core business areas with multiple sclerosis (MS) revenues increasing 2% to $9.2 billion, SPINRAZA® revenues increasing 22% to $2.1 billion and biosimilars revenues increasing 35% to $738 million. In 2019, Biogen repurchased 23.6 million shares for a total value of $5.9 billion, or $249 per average share, including 7.7 million shares repurchased in the fourth quarter of 2019 for a total value of $2.1 billion. As of December 31, 2019, $1.3 billion remained under the share repurchase program authorized in March 2019. In December, Biogen’s Board authorized an additional program to repurchase up to $5 billion shares. Biogen generated a robust 44.1% return on shareholders’ equity in 2019 and $7.1 billion in net cash flows from operations, including $1.96 billion in the fourth quarter of 2019. Biogen ended the year with $5.9 billion in cash and investments and $6 million in notes payable on its solid balance sheet. For 2020, revenues are expected in the $14 billion to $14.4 billion range with adjusted earnings in the $31.50 to $33.50 range, down slightly from last year as the company ramps up its operations in anticipation of completing a U.S. regulatory filing for its Alzheimer’s drug, aducanumab. On the conference call, Michael Vounatsos, Biogen’s CEO, stated, “Our pipeline has grown and is maturing, as we added 7 new clinical programs in 2019 and expect 11 mid- to late-stage data readouts by the end of 2021. We look forward to multiple near-term opportunities for value creation, including in Alzheimer’s disease, ALS, stroke, lupus, ophthalmology and biosimilars, as we aim to build a multi-franchise portfolio. Across all areas of investment, we remain focused on diligent capital allocation to maximize returns for our shareholders over the long term.”Tractor Supply-TSCO reported fourth quarter sales rose 2.7% to $2.2 billion with net income up 5.3% to $144.2 million and EPS up 9% to $1.21. Comparable store sales in the fourth quarter inched up 0.1% with average ticket up 1.8% and traffic down 1.7%. This comp store sales growth was below management’s expectations with the weakness driven primarily by the effect of warmer than expected weather that impacted the sale of seasonal products and softness in several holiday discretionary categories. For the full 2019 year, sales increased 5.6% to $8.4 billion with comparable sales up 2.7% for the year. Full year net income increased 5.6% to $562 million with EPS growing 8.1% to $4.66. Return on shareholders’ equity for the year was a healthy 35.9%. Free cash flow increased a robust 43% during the year to $594 million with the company paying $163 million in dividends and repurchasing 5.4 million shares of common stock for $533.3 million at an average cost of $98.76 per share. Since inception of the share repurchase program in 2007, the company has repurchased $2 billion of its share with the share buyback in fiscal 2020 expected in the range of $450 million to $550 million. Fiscal 2020 sales are expected to increase 5%-6% in the range of $8.75 billion to $8.9 billion with comparable store sales expected to increase 1.5% to 3% in 2020. Operating margin is expected to approximate 8.9% leading to EPS in the range of $4.90-$5.10, representing growth of 5%-9%. During 2019, Tractor Supply opened 80 new Tractor Supply stores and eight new Petsense stores and closed one Tractor Supply store and three Petsense stores. In 2020, the company expects to open about 80 new Tractor Supply stores and 10-15 new Petsense stores with capital expenditure expected in the $225 million to $275 million range.UPS-UPS reported fourth quarter revenue rose 4% to $20.6 billion with the company reporting a loss of $106 million or ($.12) per share due to pension, restructuring and legal charges. Excluding these charges, adjusted EPS increased 8.8% to $2.11. During the fourth quarter, UPS saw operating profit growth and margin expansion in all business segments. These results reflected strong 9% daily volume growth in the U.S. Domestic segment thanks to a surge in demand for air products with Next Day Air volume up 26% and productivity improvements and positive operating leverage across all business segments. Average daily volume levels exceeded 26.6 million packages in the fourth quarter, an increase of 7.5% driven by high demand for air services in the U.S. during the peak holiday season. For the full year, revenues rose 3% to $74.1 billion with net income and EPS each down 7% to $4.4 billion and $5.11, respectively. On an adjusted basis, excluding charges, EPS increased 4% to $7.53. During the year, the company generated $8.6 billion in cash flow from operations and invested $6.4 billion in capital expenditures to support network enhancements. In addition, $3.3 billion was paid in dividends, a 5.5% per share increase, and $1 billion in share repurchases. While management expects consumer demand to remain healthy globally in 2020, industrial production is expected to continue to decline. Management expects to fast-track additional investments in 2020 to better position the company to capitalize on structural changes in the market and growth opportunities. For 2020, UPS expects adjusted EPS in the range of $7.76-$8.06, representing 6%-10% growth. Operating cash flow is expected to increase 16% to $10 billion with the company planning to spend $6.7 billion on capital expenditures primarily to support global facility and automation expansions. Free cash flow is expected to be between $4.3 billion and $4.7 billion which will support further dividend payments and share repurchases anticipated in the $1 billion range for 2020.Wednesday, Jan. 29, 2020Facebook-FB reported fourth quarter revenue increased a likable 25% to $21.1 billion with net income increasing 7% to $7.35 billion and EPS increasing 8% to $2.46. Facebook daily active users increased 9% to 1.66 billion while Facebook monthly active users increased 8% to 2.5 billion as of December 31, 2019. Daily active people for the Facebook family, which includes Facebook, Instagram, Messenger and/or WhatApp, increased 11% to 2.26 billion while family monthly active people increased 9% to 2.89 billion. Facebook average revenue per user increased nearly 16% to $8.52, consisting of 19% year-over-year growth in the U.S. & Canada to $41.41, 20% growth in Europe to $13.21, 21% growth in Asia-Pacific to $3.57 and 18% growth in the Rest of World to $2.48. Operating margin declined 400 basis points to 42% as the company continues to invest in safety, privacy and security. During the quarter, Facebook generated nearly $5 billion in free cash flow, up 50% from last year, with the company repurchasing $1.3 billion shares leaving $4.9 billion under the existing repurchase authorization. On the quarterly conference call, Facebook announced a new $10 billion share repurchase authorization. Headcount increased 26% year-over-year, to 45,000, which includes 1,000 engineers working on privacy-related projects in response to increasing regulatory requirements from GDPR in Europe and CCPA in California. For the year, Facebook reported revenues increased 27% to $70 billion with net income declining 16% to $18,485 and EPS dropping 15% $6.43 on the heels of the $5 billion legal expense booked in 2019 related to Facebooks FTC settlement, which has not yet been paid. During 2019, Facebook generated a solid 18.3% return on shareholders’ equity and free cash flow of $21.2 billion. The company returned $4 billion to shareholders in 2019 through share repurchases, ending the year with nearly $55 billion in cash and investments and no long-term debt. While management did not provide guidance for the 2020, on the conference call, the CFO said that first quarter revenues will decelerate by low- to mid-single digits over the fourth quarter due to the impact of privacy regulations and tighter privacy controls by the likes of Apple. Microsoft-MSFT reported fiscal second quarter revenues rose 14% to $36.7 billion with net income booting up a 38% increase to $11.6 billion with EPS up 40% to $1.51. This strong growth was broad-based across geographic segments and all business segments. Revenues in Productivity and Business Processes increased 17% to $11.8 billion with 24% growth in LinkedIn revenue, as someone is hired every 7 seconds on LinkedIn. Revenue in Intelligent Cloud increased 27% to $11.9 billion driven by Azure revenue growth of 62%. Microsoft has more datacenter regions than any other company with unmatched scale and security. Revenue in More Personal Computing increased 2% during the quarter to $13.2 billion driven by a 25% increase in Windows Commercial products and cloud services. Free cash flow increased 15% during the first half of fiscal 2020 to $17.6 billion with the company paying $7.4 billion in dividends and repurchasing $10.1 billion of common stock during the same time period. Microsoft’s balance sheet remains strong with $134 billion in cash and investments, $63 billion in long-term debt and $110 billion in shareholders’ equity as of 12/31/19. For the full fiscal 2020 year, Microsoft expects to report double-digit growth in revenues and operating income with operating margin expected to expand by 200 basis points thanks to the strength in its commercial business.Starbucks-SBUX reported first fiscal quarter sales increased 7% to $7.1 billion with net earnings increasing 16% to $886 million and EPS jolting up 21% to $0.74. Global comparable store sales increased 5%, driven by a 3% increase in average ticket and a 2% increase in transactions. Americas comparable store sales increased 6% while International comparable store sales increased 1%, driven by a 3% increase in China’s same store sales. The company opened 539 net new stores during the quarter and ended the quarter with 31,795 stores, up 6% from last year. Operating margins increased 190 basis points year-over-year to 17.2% primarily due to sales leverage, supply chain efficiencies and lower restructuring and impairment charges, partially offset by growth in wages and benefits, as well as investments in store labor hours. During the quarter, Starbucks generated $1.44 billion in free cash flow and returned nearly $1.6 billion to shareholders through share repurchases of $1.1 billion and dividends of $484 million. Starbucks ended the quarter with $3.7 billion in cash and investments and $10.7 billion in long-term debt. Given the strong first quarter results, the company would have increased guidance, if not for the uncertainty surrounding the impact of the coronavirus. Thus far, Starbucks has closed half of its stores in China. Given the dynamic nature of the circumstances, the duration of the business disruption, reduced customer traffic and the related financial impact cannot be reasonably estimated, though the impact will likely be material to international results. The company will update its guidance as events unfold.T. Rowe Price-TROW reported fourth quarter revenues rose 12.5% to $1.5 billion with net income jumping 55% to $545.3 million and EPS up 59% to $2.24 as margins expanded thanks to well controlled expenses. Ending assets under management increased 25% to end the year at $1.21 trillion, reflecting asset inflows and market capital appreciation. Net client inflows were $2.8 billion in the fourth quarter and $13.2 billion for 2019. For the full 2019 year, revenues rose 5% to $5.6 billion with net income up 16% to $2.1 billion and EPS up 20% to $8.70. Return on shareholders’ equity was an impressive 30% in 2019. In 2019, the firm spent $708.8 million to repurchase 7 million shares, or 2.9% of its outstanding common stock at an average price of $101.65 while also increasing its dividend 8.6%. The company invested $204.6 million in capital expenditures in 2019 and expects capital expenditures in 2020 to be up to $210 million. T. Rowe Price ended the year with a strong balance sheet with no long-term debt, $5.8 billion in cash and investments and $7.1 billion in shareholders’ equity.General Dynamics - GD reported fourth quarter sales increased 3.8% to $10.8 billion with net income increasing 12.2% to $1.0 billion and EPS up 14.3% to $3.51. By business segment, Aerospace sales increased 8.4% to $2.9 billion, Combat Systems sales increased 13.1% to $2.0 billion, Information Technology sales decreased 15% to $2.0 billion, Mission Systems sales increased 2.5% to $1.3 billion and Marine Systems sales increased 11.7% to $2.6 billion. Backlog grew 28.1% to a record-high $86.9 billion, for a book-to-bill of 1.5-to-1 for the year. For the full year, revenues increased 8.7% to $39.4 billion with net income up 4.2% to $3.5 billion and EPS up 7.2% to $11.98. Return on shareholders’ equity was 25.7%. Free cash flow declined 23% to $2.0 billion with the company paying $1.2 billion in dividends and repurchasing $231 million of its shares. For 2020, management expects sales of $40.7 billion with an operating margin of 11.9% and EPS in the range of $12.55 to $12.60.Canadian National Railway-CNI reported record fourth quarter revenues declined 6% to C$3.6 billion with net income dropping 31% to C$873 million and EPS down 28% to C$1.22. The decrease in revenues was attributable to lower volumes, due to the weakening economic environment and the 8-day conductor strike. Revenue ton miles (RTM) declined by 13% with freight revenue per RTM increasing by 9%. The company’s operating ratio increased 4.1 points to 66%. For the full year, revenues increased 4% to C$14.9 billion with net income down 3% to C$4.2 billion and EPS down 1% to C$5.83. Return on shareholders’ equity was 23.4%. Free cash flow declined 16% to C$2.1 billion as the company continued to heavily invest in infrastructure expansion projects. During the year, the company paid C$1.5 billion in dividends and repurchased C$1.7 billion of its shares. For 2020, management expects adjusted earnings to grow in the low single-digit range with free cash flow in the range of C$3.0 billion to C$3.3 billion. The company also announced a 7% dividend increase, marking the 24th consecutive year of dividend increase, and a new 16 million share buyback over the next twelve months.Automatic Data Processing-ADP reported fiscal second quarter revenues rose 5%, or 6% on an organic basis, to $3.7 billion with net income jumping 17% to $651.6 million as margins expanded with EPS up 18% to $1.50. Free cash flow increased 21% during the first half of fiscal 2020 to $1.0 billion with the company paying $686 million in dividends and repurchasing $615 million of common stock. ADP has increased their dividend for 45 consecutive years, one of only 30 companies with such a long dividend track record of record dividend increases. The dividend currently yields 2.0%. Margin expansion was driven by continued execution of transformation initiatives as well as operating efficiencies. Employer Services New Business Bookings grew 3%. Interest on funds held for clients increased 7% to $138 million as the average client funds balance increased 6% to $25.1 billion with the average interest yield on client funds flat at 2.2%. For the full fiscal 2020 year, ADP anticipates interest on funds held for clients to approximate $570 to $580 million. Revenue for the full fiscal 2020 year is expected to increase about 6% with EPS growth of 14% to 16% expected. ADP management continues to see stable growth in the U.S. economy with wage growth driving increased consumer confidence. International wage growth is also stable.Mastercard Incorporated-MA reported fourth quarter revenues increased 16% to $4.4 billion with net earnings charging ahead 134% to $2.1 billion and EPS increasing 138% to $2.07. Excluding gains on equity investments and litigation expenses in 2019 and 2018, adjusted net income increased 23% to $2 billion and adjusted EPS increased 26% to $1.96. For the full year, revenues increased 13% to $16.9 billion with net income up 39% to $8.1 billion and EPS up 42% to $7.94. Excluding investment gains and litigation expense, adjusted net earnings increased 17% to $7.9 billion and adjusted EPS increased 20% to $7.77. Revenue growth was driven by a 13% increase in gross dollar volume, on a local currency basis, to $6.5 trillion, an increase in cross-border volume of 16%, an increase in switched transactions of 19% plus an increase in other revenues of 23%, driven primarily by the company’s Cyber & Intelligence and Data & Services solutions. These increases were partially offset by an increase in rebates and incentives, primarily due to new and renewed agreements and increased volumes. As of December 2019, the company’s customers had issued 2.6 billion Mastercard and Maestro-branded cards, up 5% from last year. For the year, Mastercard generated a stellar 137.8% return on shareholders’ equity and nearly $7.8 billion in free cash flow. The company returned $7.8 billion to shareholders during 2019 through dividend payments of $1.3 billion and share repurchases of $6.5 billion. Management expects the healthy consumer spending seen in 2019 to continue resulting in full year 2020 revenue growth in the low-teens with adjusted operating expenses in the high single digits.Tuesday, Jan. 28, 2020Stryker Corporation-SYK reported fourth quarter sales increased a healthy 9% to $4.1 billion with reported earnings and EPS declining 65% to $725 million and $1.90, respectively. Excluding a $1.5 billion, or $4.01 tax benefit in 2018 related to tax reform and tax items recorded in 2019, Stryker’s net income and EPS increased 44% year-over-year. During the quarter, Stryker installed 89 robots compared with 54 installed during the fourth quarter of 2018. Stryker ended the year with 860 installed MAKO robots, including 700 in the U.S. MAKO procedures during the fourth quarter increased 50% from 2018 to 36,600, bringing the total number of procedures in 2019 to 114,000. For 2019, Stryker’s sales increased 9% to $14.9 billion with net earnings and EPS falling 41% to $2 billion and $9.34, respectively. Excluding discreet tax items in both 2019 and 2018, earnings increased 10.5% and EPS increased 8.8%. 2019 marked the 40th consecutive year of sales growth since Stryker went public in 1979. By segment, Orthopaedics sales increased 5.2% to $5.3 billion, boosted by 8% growth in knees as the company continued to take market share as 50% to 60% of MAKO installations are into competitive accounts. MedSurg sales increased nearly 9% to $6.5 billion powered by a 12% jump in instrument sales. Neurotechnology and Spine increased 19% to $3.1 billion, reflecting a full year of sales from the $1.4 billion acquisition of spinal surgery device maker K2M. During 2019, Stryker generated a 16.3% return on shareholders’ equity and $1.5 billion in free cash flow, down 25% from 2018 as effective working capital management partially offset the decline in reported earnings. The company returned $1.1 billion in cash to shareholders in 2019 through dividends of $778 million and share repurchases of $307 million. Given the acquisition of trauma and extremity medical device maker Wright Medical Group for $4 billion in cash, which is expected to close in the second quarter, Stryker does not anticipate repurchasing shares in 2020. Stryker ended the year with $4.4 billion in cash and investments, $10 billion in long-term debt and $13 billion in shareholders’ equity. Looking ahead to 2020 management expects organic net sales growth of 6.5% to 7.5% and adjusted EPS of $9.00 to $9.20, up 10% from 2019 at the mid-point. Apple-AAPL reported first fiscal quarter revenues rose 9% to $91.2 billion with net income up 11% to $22.2 billion and EPS climbing 19% to $4.99. These record results reflected strong demand for the iPhone 11 and iPhone 11 Pro models and all-time records for Services and Wearables. iPhone sales increased 8% during the quarter to $56 billion with Services revenues increasing 17% to $12.7 billion and Wearables sales jumping 37% to $10 billion thanks to strong demand for Apple Watches and AirPods, with both items capacity constrained. During the holiday quarter, the company’s active installed base of devices grew in each geographic segment and has now reached over 1.5 billion. The company ended the quarter with 480 million paid subscribers to its Services, a 120 million increase year over year. Apple expects to exceed 500 million subscribers in the March quarter with a goal of 600 million subscribers by year end to its Services. International sales accounted for 61% of the quarter’s revenues with double-digit growth generated both in the Americas and Europe during the quarter. Free cash flow increased 22% during the quarter to $28 billion with the company paying dividends of $3.5 billion during the quarter and repurchasing $20.7 billion of common stock. Apple ended the quarter with about $207 billion in cash and investments, $93 billion in long-term debt and $89.5 billion in shareholders’ equity. Apple provided second quarter guidance with revenue expected in the range of $63 billion to $67 billion, gross margin in the range of 38%-39%, operating expenses between $9.6 billion and $9.7 billion, other income of $250 million and a tax rate of about 16.5%. The coronavirus is creating uncertainty among the company’s supply chain with retail stores also being temporarily closed in China.3M-MMM posted a 2% increase in fourth quarter sales to $8.1 billion with net income falling 28% to $969 million and EPS dropping 27% to $1.66. Continued softness in automotive and electronics end markets weighed on organic local-currency sales which declined 2.6% year-over-year. Fourth quarter earnings include a pre-tax restructuring charge of $134 million, or $0.20 per share, and a charge related to ongoing PFAS litigation of $214 million, or $0.29 per share. 3M’s fourth quarter restructuring includes the elimination of 1,500 jobs and is expected to generate savings of $110 million to $120 million annually, with $40 million to $50 million expected in 2020. For the year, sales declined 1.9% to $32.1 billion on a 1.5% decline in organic local currency growth with net income falling 15% to $4.6 billion and EPS falling 12% to $7.81. These results include litigation expenses of $1.29 per share. The company generated a 17.5% return on invested capital and $5.4 billion in free cash flow, a record, that was up 10% year-over-year. During 2019, 3M returned $4.7 billion to shareholders through share repurchases of $1.4 billion and dividends of $3.3 billion. In 2019, 3M marked its 61st consecutive year of annual dividend increases. 3M ended the year with $2.5 billion in cash and investments, $17.5 billion in long-term debt and $10 billion in shareholders’ equity. Looking ahead to 2020, management expects organic local-currency growth to be flat to up 2% with EPS of $9.30 to $9.76, up 19% to 25% from 2019.United Technologies-UTX reported fourth quarter revenues rose 8% to $19.6 billion with net income rocketing 67% higher to $1.1 billion and EPS up 59% to $1.32. On an adjusted basis, EPS declined 1% to $1.94 reflecting the impact of nonrecurring and restructuring charges. For the full year, revenues increased 16% to $77 billion including 5% organic growth with contributions from all business segments. Net income increased 5% to $5.5 billion with EPS down 1% to $6.41, which included $1.85 of net restructuring charges and $1.46 of one-time portfolio separation costs. On an adjusted basis, EPS increased 9% to $8.26. Free cash flow increased 50% to $6.6 billion during the year, with the company paying $2.4 billion in dividends. United Technologies delivered record sales, adjusted earnings and free cash flow in 2019 on continued aerospace strength and a return to profit growth at Otis. Operational separation activities of Otis and Carrier are substantially complete, and the spin-off of both businesses is expected to occur early in the second quarter of 2020. At the same time, United Technologies will merge its aerospace business with Raytheon to create Raytheon Technologies, which will be the premier aerospace and defense systems and services provider. Raytheon Technologies remains on target to reap $1 billion in cost synergies. For Pratt & Whitney, 2020 sales are expected to be up mid-single digits versus 2019 with operating profit expected to increase $225 million to $275 million. Collins Aerospace sales are expected to decline in the low single-digit range due to an estimated 5% headwind resulting from the suspension of the Boeing 737 MAX production, lower ADS-B mandate sales and the divestitures associated with the Raytheon merger. Collins Aerospace’s adjusted operating profit is expected to be down $275 million to $325 million in 2020 due to the same factors.Monday, Jan. 27, 2020F5 Networks-FFIV reported first fiscal quarter revenues increased 5% to $569.3 million with net income and EPS falling 25% to $98.5 million and $1.62, respectively. Product revenues, of $234.5 million were flat with last year on an 11% decline in System sales (72% of product revenues) offset by a 50% increase in software sales, which now account for 28% of product revenues, up from 19% last year as the company continues its digital transformation. Service revenue, which accounted for 59% of total company revenue, increased 8% to $334.8 million, driven by the accelerating software sales and the NGINX acquisition. Gross margins increased slightly while operating margins fell 760 basis points on a jump in sales and administrative expenses. During the quarter, the company generated $122 million in free cash flow, down 31% from last year, on the lower income and working capital changes. No shares were repurchased during the quarter. Management expects to use future cash flow to pay down the $400 million term loan taken on in the $1 billion acquisition of Shape Security which closed last week. F5 ended the quarter with nearly $1.5 billion in cash and investments on its strong balance sheet. Looking ahead to second quarter, the company expects software sales to increase in the 60% to 70% range, driving total revenue growth of 6% to 8% in the $580 million to $590 million range with adjusted EPS expected in the $2.14 to $2.17 range, down 16% at the midpoint. Bank of Hawaii-BOH reported fourth quarter net interest income declined 1% to $123.9 million with net income and EPS each up 12% to $58.1 million and $1.45, respectively. For the full 2019 year, net interest income rose 2% to $497.7 million with net income up 3% to $225.9 million and EPS up 6% to $5.56. The net interest margin for the full year was 3.03%, a decrease of 2 basis points from the net interest margin of 3.05% in 2018. Return on shareholders’ equity for the year was 17.6%. The return on average assets for the year was 1.29% unchanged from 2018. The efficiency ratio for the full year improved to 55.68% compared with 56.71% in the prior year period. Loan balances grew 5.2% in 2019 while deposit balances grew 5% compared to 2018. The bank’s asset quality, capital and liquidity all remain strong. During the fourth quarter, the bank repurchased 336,200 shares at a total cost of $30 million at an average cost of $89.11 per share. Since the inception of the repurchase program in July 2001 through 12/31/19, the bank has repurchased 56.9 million shares for $2.3 billion at an average cost of $40.38 per share. The Board of Directors increased the share repurchase authorization by an additional $100 million bringing the remaining buyback authority up to $120.4 million. The bank’s capital allocation strategy is to pay out 50% of earnings in dividends and use excess cash (generally another 30% of earnings) for share repurchases while retaining the remaining 20% of earnings to support future growth. General economic conditions in Hawaii remain stable due to low interest rates, a relatively healthy construction sector and growing visitor arrivals. The statewide unemployment rate in Hawaii continues to remain low at 2.6% at year end compared with 3.5% nationally. Real estate prices on Oahu remained steady during 2019.Wednesday, Jan. 22, 2020Johnson & Johnson-JNJ reported fourth quarter sales increased 1.4% to $10.8 billion with net earnings increasing 32% to $4 billion and EPS up 34% to $1.50. Adjusted earnings, which excludes litigation, amortization and other discrete expenses, declined by 6.4% to $5 billion and adjusted EPS dipped 3% to $1.88. For the full year, sales increased 0.6%, or 2.8% in constant currency, to $82.1 billion with net earnings dipping 1.2% to $15.1 billion and EPS edging up 0.4% to $5.63 thanks to share repurchases. Adjusted earnings increased 4.5% to $23.3 billion and adjusted EPS increased 6% to $8.68. By business segment, Pharmaceutical sales increased 3.6% to $42.2 billion driven by sales of Stelara, DARZALEX, IMBRUVICA, SYMTUZA and TREMFYA. Medical Device sales dipped 3.8% to $26 billion and Consumer sales increased slightly to $13.9 billion driven by Neutrogena, Tylenol, Zarbee’s Imodium, ZYRTEC and the DR. CI:LABO acquisition. During 2019, Johnson & Johnson generated nearly $20 billion in free cash flow, up 7% from last year. The company returned $14 billion to shareholders through dividends of $9.9 billion and share repurchases of $4.1 billion. During the year, the company invested $7 billion in 11 acquisitions and 6 license agreements to fuel future growth. During the past four years, Johnson & Johnson’s robust cash flow enabled the company to invest $45 billion in R&D, $50 billion in value-creating acquisitions and $40 billion in shareholder distributions. Looking ahead to 2020, management expects sales to be in the $85.4 billion to $86.2 billion range, up 4% to 5%, with adjusted EPS expected in the $8.95 to $9.10 range, up 3.1% to 4.8%. The company does not anticipate repurchasing additional shares during 2020 as it continues to negotiate with state attorney generals to settle opioid lawsuits. While management is optimistic about the settlement, it cannot predict the timing or amount of the resolution.Friday, Jan. 17, 2020Fastenal-FAST reported fourth quarter revenues rose 4% to $1.3 billion with net income up 6% to $178.7 million and EPS up 5% to $.31. The increase was driven by higher unit sales related to industrial vending and Onsite locations. The general slowing in economic activity continued in the fourth quarter exacerbated by holiday timing and longer than usual year-end plant shutdowns. Industrial production remains weak going into 2020, notably in the heavy equipment, oil and gas, metals and transportation sectors. Sales of fastener products grew 1.8% in the fourth quarter and represented 34% of total revenues as sales of non-fastener products grew 5.1% and represented 66% of total revenues. Gross margin declined in the fourth quarter due to customer and product mix. For the full 2019 year, revenues increased 7% to $5.3 billion with net income and EPS each up 5% to $791 million and $1.38, respectively. Return on shareholders’ equity was an impressive 29.7% for the year. Free cash flow increased 20% during the year to $596 million with the company paying $499 million in dividends during the year. Fastenal increased the quarterly dividend an additional 14% to $.25 per share for the first quarter of 2020.Wednesday, Jan. 15, 2020Unitedhealth Group-UNH reported fourth quarter revenues increased 4% to $61 billion with net income up 17% to $3.5 billion and EPS up 19% to $3.90. For the year, Unitedhealth Group reported revenues increased 7% to $242 billion with net earnings increasing 15% to $13.8 billion and EPS increasing 18% to $14.33. By segment, Unitedhealthcare revenues of $194 billion increased 6%, primarily due to growth in the number of people served in Medicare Advantage and commercial benefits. As of December 31, 2019, Unitedhealthcare served 27.76 million commercial customers, 5.27 million Medicare Advantage customers, 4.5 million Medicare Supplement customers, 5.9 million Medicaid customers and 5.7 million international customers, with the total up slightly from last year. Optum’s full year revenues increased 12% to $113 billion, with notably strong growth in OptumHealth which grew revenues a healthy 26% to $30 billion. OptumInsight revenue grew 11% to $10 billion while OptumRX revenues rose 7% to $74.3 billion. During the year, the company generated a vigorous 22.9% return on shareholders’ equity, operating cash flow of $18.5 billion and free cash flow of $16.4 billion, up 20% from last year. The company returned $9.4 billion to shareholders during 2019 through dividend payments of $3.9 billion, that were up 18.4% from last year, and share repurchases of $5.5 billion at an average cost per share of $245.53 per share. Unitedhealth Group ended the year with $51.5 billion in cash and investments, $36.8 billion in long-term debt and $60.4 billion in shareholders’ equity. The company affirmed its recently issued full year earnings outlook for 2020 with net earnings of $15.45 to $15.75 per share, up about 9% at the mid-point.Collins Aerospace Systems, a unit of United Technologies Corp-UTX, has signed a contract with Lockheed Martin to provide critical subsystems to support production of NASA's Orion spacecraft fleet for Artemis missions III through VIII. Valued at $320 million, the systems being provided by Collins Aerospace will play an important role in enabling NASA's goal of boots on the Moon by 2024, as well as establishing a sustained presence on and around the Moon to prepare for missions to Mars.Monday, Jan. 13, 2020T. Rowe Price Group, Inc.-TROW reported preliminary month-end assets under management of $1.21 trillion as of December 31, 2019, representing a 25.5% increase for the full 2019 year.Wednesday, Jan. 8, 2020MSC Industrial-MSM reported fiscal 2020 first quarter sales dipped 1% to $823.6 million with net earnings declining 12% to $65.4 million and EPS down 11% to $1.18. These results reflect broad-based softness in the industrial sector, especially in autos, heavy trucks, agriculture and oil & gas and management’s ongoing journey to reposition the company from a spot buy-only supplier to a mission critical partner on the plant floors of its manufacturing customers. During the quarter, MSC Industrial generated $72.4 million in free cash flow, up 11% from last year on working capital efficiencies. The company paid $42 million in dividends during the quarter, reflecting the regular quarterly dividend of $0.75 per share. Consistent with the company’s balanced allocation strategy of returning cash to shareholders, the Board declared a special dividend of $5.00 per share in addition to the regular dividend, both payable on February 5th. These dividends totaling almost $320 million will be paid from existing cash on hand and by tapping into the company’s revolving credit facility. MSC Industrial ended the quarter with $28 million in cash, $268 million in long-term debt and $1.5 billion in shareholders’ equity. Given weakness in December, which management attributes to holiday timing, shutdown schedules, and end of year purchasing decisions by customers; its anticipated mid-year price increase; and ongoing efforts to reposition the business, second quarter sales are expected in the $781 million to $798 million range, down 4% year-over-year at the mid-point. Gross margins are expected in the 41.8% to 42.2% range from 42.7% last year. Operating margins are expected in the 9.5% to 9.9% range from 11.7% last year. EPS are expected in the $0.97 to $1.03 range, down 19% from last year at the mid-point.Walgreens Boots Alliance-WBA reported first fiscal sales increased 1.6% to $34.3 billion with net income dropping 25% to $845 million and EPS declining 20% to $.95. Earnings were adversely impacted by costs related to the acquisition of Rite Aid stores and to the implementation of the Transformational Cost Management Program, which is on track to deliver in excess of $1.8 billion in annual cost savings by fiscal 2022. The first fiscal quarter came in softer than expected with gross margin down due to lower than expected prescription drug volume, continued reimbursement pressure and a challenging competitive environment. Walgreen’s market share declined 55 basis points in the Retail Pharmacy USA to 20.9% reflecting in part the impact of store optimization. Retail Pharmacy International sales declined 5.4% during the quarter reflecting foreign currency headwinds and lower retail sales in Boots U.K. due to a soft economy and lower sales in Chile due to social unrest. Free cash flow improved significantly during the quarter to $674 million as operating income more than doubled thanks to working capital improvements. While the second fiscal quarter is expected to continue to be challenging, management expects the second half of the fiscal year to improve which enabled them to maintain their full year adjusted EPS guidance of roughly flat growth in fiscal 2020 at constant currency rates, with a range of plus or minus 3%.Private sector employment increased by 202,000 jobs from November to December according to the December ADP National Employment Report®. "As 2019 came to a close, we saw expanded payrolls in December," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "The service providers posted the largest gain since April, driven mainly by professional and business services. Job creation was strong across companies of all sizes, led predominantly by midsized companies." Mark Zandi, chief economist of Moody's Analytics, said, "Looking through the monthly vagaries of the data, job gains continue to moderate. Manufacturers, energy producers and small companies have been shedding jobs. Unemployment is low, but will begin to rise if job growth slows much further." Monday, Dec. 30, 2019Raytheon Missile Systems Co., a unit of Raytheon-RTN, has been awarded a $768,283,907 non-competitive fixed-price incentive (firm) contract for Advanced Medium Range Air-to-Air Missile (AMRAAM) Production Lot 33. This contract provides for the production of the AMRAAM missiles, captive air training missiles, guidance sections, AMRAAM telemetry system, spares and other production engineering support hardware. Friday, Dec. 20, 2019 F5 Networks-FFIV will acquire privately held Shape for a total enterprise value of about $1 billion, financed with F5 Networks’ balance sheet cash and a $400 million senior unsecured term loan. Shape, a leader in fraud and abuse prevention, adds protection from automated attacks, botnets and targeted fraud to F5’s world-class portfolio of application services, protecting customers’ digital experiences. This strategic acquisition accelerates F5’s growth momentum and more than doubles F5’s addressable market in security to $8 billion. With $60 million in mostly subscription revenues and growing 50% year-over-year, Shape improves F5’s software revenue growth rate from mid-single-digits to mid-to-high single-digits and boosts software revenue growth from 35-40% to 60-70%. F5’s fiscal 2020 gross margins are expected to be about 85%, in line with prior guidance, while non-GAAP operating margins are expected to be 30-32%, down from 33-35%, reflecting investments to drive future growth. The transaction is expected to be dilutive to fiscal year 2020 non-GAAP EPS in the mid-to-high single-digit range and accretive to cash flow within 12 months of closing, which is expected in the first calendar quarter of 2020.Thursday, Dec. 19, 2019NIKE-NKE reported fiscal 2020 second quarter sales increased 10% to $10.3 billion with net earnings increasing jumping 32% to $1.1 billion and EPS increasing 35% to $0.70. By geography, North America sales increased 5% to $4 billion, Europe, Middle East & Africa sales increased 10% to $2.5 billion, Greater China sales increased 20% to $1.8 billion and Asia Pacific & Latin America sales increased 13% to $1.5 billion. Gross margins increased 20 basis points as strong pricing more than offset a 40 to 50 basis point headwind from tariffs and increased supply chain investments including RFID technology and new distribution centers to accommodate the growth in Nike Direct. SG&A expenses declined by 130 basis points in the wake of management’s decision to defer a portion of demand creation expense to the second half to capitalize on the Olympics and other major global sporting events even as the company continues to invest in its digital transformation to accelerate future growth. During the second quarter, NIKE, Inc. repurchased 10.1 million shares for about $922 million, or $91.29 per average share, as part of the four-year, $15 billion program approved by the Board of Directors in June 2018. As of November 30, 2019, a total of 33.6 million shares had been repurchased under this program for approximately $2.9 billion, or $86.31 per average share. Nike ended the quarter with more than $3.5 billion in cash and investments and $3.5 billion in long-term debt. Looking ahead to the full year, Nike expects sales to grow in the high-single digits range with foreign currency headwinds of 2% to 3%. FactSet-FDS reported fiscal first quarter revenues increased 4% to $366.7 million with net income up 12% to $94 million and EPS up 12% to $2.43. The increase in sales was primarily due to higher sales of analytics, content and technology solutions and wealth management solutions. Annual Subscription Value (ASV) plus professional services was $1.48 billion. Operating margin increased to 30.9% compared to 28.6% in the prior year period as a result of improved operating results. Client count increased by 27 to 5,601 driven by an increase in corporate clients and wealth management. User count decreased by 37 to 126,785 due to a decrease in sell side users. Annual ASV retention was greater than 95%. When expressed as a percentage of clients, annual retention was 89%. Employee count increased 2.8% to 9,865. Free cash flow increased 88% during the first quarter to $69 million due to higher earnings and favorable working capital changes. During the past quarter, the company paid $27 million in dividends and repurchased 343,000 shares for $84.4 million at an average cost of $246.13 per share. FactSet has $154.2 million remaining authorized for future share repurchases. FactSet maintained their guidance for the full fiscal 2020 year with revenue expected in the range of $1.49 billion and $1.5 billion and EPS in the range of $8.70 and $9.00.Accenture-ACN reported fiscal first quarter revenues increased 7%, or 9% in constant currency, to $11.4 billion with net income increasing 6% to $1.4 billion and EPS up 7% to $2.09. Accenture’s first quarter revenue growth was broad-based across industries and geographic markets, reflecting the diversity and scale of the company’s business around the world. By operating group, Communications, Media & Technology revenues increased 7% to $2.2 billion, Financial Services revenues increased 6% to $2.2 billion, Health & Public Service revenues increased 13% to $2 billion, Products revenues increased 12% to $3.2 billion and Resources revenues increased 7% to $1.7 billion. North America revenues increased 9% to $5.3 billion, Europe grew by 7% in local currency and growth markets increased 13% to $2.3 billion. New bookings were $10.3 billion, up slightly from last year. The New, Accenture’s digital transformation business, accounted for more than 65% of the company’s bookings during the quarter. Accenture generated $692 million in free cash flow during the quarter, down 27% from last year, on working capital changes and a 22% jump in capital expenditures as the company continues to invest in the business to support growth. The company returned $1.2 billion to shareholders during the quarter through share repurchases of $729 million at an average cost per share of $189.65 and dividends of $508 million, or $0.80 per share, up 10% from last year. Management raised the bottom range of its guidance for fiscal 2020 with revenue growth now expected in the range of 6% to 8% in local currency, compared to prior guidance of 5% to 8%. Management expects fiscal 2020 EPS in the $7.66 to $7.84 range, compared to $7.62 to $7.84 previously guided. During fiscal 2020, the company expects to generate free cash flow in the range of $5.7 billion to $6.1 billion and return $4.8 billion to shareholders through share repurchases and dividends.Wednesday, Dec. 18, 2019Paychex-PAYX reported fiscal second quarter revenues rose 15% to $990.7 million with net income up 10% to $258.7 million and EPS climbing 11% to $.72. The acquisition of Oasis Outsourcing contributed about 9% to the growth in total revenue. Solid growth was delivered across the major business lines during the quarter, particularly in human resource outsourcing services, time and attendance solutions and retirement services. Interest on funds held for clients increased 9% during the quarter to $19.9 million due to higher realized gains, average investment balances and average interest rates. Return on shareholders’ equity over the trailing 12 months was a stellar 42%. Free cash flow increased a robust 16% during the first half of the year to $505 million thanks to higher earnings and working capital changes. During the first half, the company paid $444.3 million in dividends and repurchased 2.0 million shares for $171.9 million at an average cost of $85.95 per share. For the full fiscal 2020-year, management raised their financial outlook with Management Solutions revenue expected to grow in the range of 5% to 5.5%, PEO and Insurance Services revenue expected to grow in the range of 25% to 30% and EPS expected to increase in the range of 9% to 10%. Paychex sees continued growth for small businesses in the year ahead as strong demand is leading to higher wages and hours worked for employees of small businesses.Tuesday, Dec. 17, 2019MSC Industrial-MSM announced that its Board of Directors has declared a special cash dividend of $5.00 per share. The special cash dividend is payable on February 5, 2020 to shareholders of record at the close of business on January 22, 2020. The company will initially fund the approximately $277 million required for the special cash dividend from cash on hand and its revolving credit facility. The company also announced that its Board of Directors has declared the regular quarterly cash dividend of $0.75 per share.Thursday, Dec. 12, 2019Oracle-ORCL reported fiscal 2020 second quarter revenues increased 1% to $9.6 billion with net income dipping 1% to $2.3 billion and EPS up 13%, on fewer shares outstanding, to $0.69. Cloud Services and License Support revenues were $6.8 billion, up 3% from last year, while Cloud License and On-Premise License revenues were $1.1 billion, down 7%, as the company continues to transition its business to cloud-based offerings. Cloud and License revenues by ecosystem included applications revenues of $2.9 billion, up 4% from last year and infrastructure revenues of $5 billion, which were flat when compared to last year. Fusion and NetSuite drove growth in cloud applications with Fusion ERP revenues growing 37% and NetSuite ERP revenues growing 29%. While still in its early days, the Oracle Autonomous Database has thousands of customers running in the company’s Gen2 Public Cloud with growth rates exceeding 100%. During the quarter, Oracle repurchased 91 million shares for $5 billion ($54.95 per average share), bringing the total repurchases during the past twelve months to $26 billion. Over the past five years, Oracle has reduced its share count by 25%. During the first half of the fiscal year, Oracle generated $5.7 billion in free cash flow, down 11% from last year, with the company returning $11.6 billion to shareholders through share repurchases of $10 billion and dividends of $1.6 billion. Oracle ended the quarter with $26 billion in cash, $52 billion in long-term debt and $16 billion in shareholder equity. During the quarterly conference call, Larry Ellison, Oracle’s founder and CTO, stated that the company has no plans to replace its recently deceased co-CEO, Mark Hurd, that he has complete confidence in Safra Catz as Oracle’s sole CEO. Looking ahead to the third quarter, Ms. Catz expects revenues to grow by 1% to 3%.Tuesday, Dec. 10, 2019T. Rowe Price Group-TROW reported preliminary month-end assets under management of $1.18 trillion as of November 30, 2019, which represents a 22.8% increase since year end. Monday, Dec. 9, 2019UnitedHealth Group-UNH announced that OptumRx, the pharmacy care services business of Optum, and Diplomat, a provider of specialty pharmacy and infusion services, are combining. The agreement calls for the acquisition of Diplomat’s outstanding common stock for $4.00 per share through a cash tender offer and assumption of outstanding debt worth approximately $300 million.Thursday, Dec. 5, 2019Ulta Beauty-ULTA reported third quarter sales increased 7.9% to $1.7 billion with net income dipping 1% to $130 million and EPS increasing 3.2% on fewer outstanding shares to $2.25. Comparable sales (sales for stores open at least 14 months and e-commerce sales) increased 3.2% compared to an increase of 7.8% in the third quarter of fiscal 2018, driven by 2.3% transaction growth and 0.9% growth in average ticket and a modest increase in traffic. By category, skincare generated double-digit comp growth, fragrance increased high-single digits, haircare sales increased mid-single digits while makeup declined by low-single digits. Despite the current challenging environment in cosmetics, Ulta Beauty continued to gain market share in the category. During the third quarter, Ulta Beauty opened 28 net new stores ending the quarter with 1,241 stores. During the quarter, the company repurchased 529,404 shares, a higher number than initially planned, at a cost of $128.6 million, or $242.91 per average share. Year-to-date, the company repurchased 1,639,438 shares at a cost of $507 million, or $309.19 per average share. As of November 2, 2019, $388.8 million remained available under the $875 million share repurchase program announced in March 2019 with the company expecting to repurchase a total of $700 million shares in 2019. Year-to-date, the company generated free cash flow of $316 million, up 10.7% from last year, ending the quarter with $209 million in cash. Given challenged top line growth due to softness in the makeup category and the year-to-date performance, the company narrowed its full year guidance. Sales are now expected to increase 10% versus the previous expectation of growth between 9% and 12% with same store sales growth now expected in the range of 4.7% to 5% versus 4% to 6% previously expected. EPS are now expected in the range of $11.93 to $12.03 versus $11.86 to $12.06 previously expected. Capital expenditures are now expected in the range of $305 million to $315 million, $35 million less than previously expected due to the decision to delay the opening of the new Jacksonville distribution until 2021.Brown-Forman-BFB reported fiscal second quarter revenues rose 9% to $989 million with net income up 13% to $282 million and EPS up 14% to $.59. Results improved during the second quarter as the company delivered solid underlying growth from both a geographic and portfolio basis despite the impact of tariffs and the uncertain global economic and geopolitical environment. Underlying net sales grew 6% in the United States, 5% in emerging markets and 3% in developed international markets. Jack Daniel’s family of brands underlying net sales grew 2% bolstered by the October launch of Jack Daniel’s Tennessee Apple. The company’s premium bourbons grew underlying net sales 22% driven by Woodford Reserve’s 20% growth and even stronger growth from Old Forester. The tequila portfolio grew underlying net sales 11% led by Herradura’s 19% growth and el Jimador’s 13% growth. During the first half of the fiscal year, free cash flow declined 37% to $139 million with the company paying $158 million in dividends. During the quarter, the board raised the dividend 5%, marking the 36th consecutive year of dividend increases and 74 consecutive years of dividend payments. As the company gets set to celebrate its 150th anniversary in 2020, management reaffirmed its full year fiscal 2020 underlying net sales growth outlook of 5% to 7% with EPS expected in the range of $1.75-$1.85.Wednesday, Dec. 4, 2019Stryker-SYK announced that its Board of Directors has declared a quarterly dividend of $0.575 per share payable on January 31, 2020 to shareholders of record at the close of business on December 31, 2019, representing an increase of approximately 11% versus the prior year and the previous quarter. “We continue to deliver strong financial results, and consistent with our stated capital allocation philosophy, are raising our dividend 11%," said Kevin Lobo, Chairman and Chief Executive Officer. Private sector employment increased by 67,000 jobs from October to November according to the November ADP National Employment Report®. "In November, the labor market showed signs of slowing," said Ahu Yildirmaz, vice president and co-head of the ADP Research Institute. "The goods producers still struggled; whereas, the service providers remained in positive territory driven by healthcare and professional services. Job creation slowed across all company sizes; however, the pattern remained largely the same, as small companies continued to face more pressure than their larger competitors." Mark Zandi, chief economist of Moody's Analytics, said, "The job market is losing its shine. Manufacturers, commodity producers, and retailers are shedding jobs. Job openings are declining and if job growth slows any further unemployment will increase."Tuesday, Dec. 3, 2019Mastercard-MA announced that its Board of Directors has declared a quarterly cash dividend of 40 cents per share, a 21 percent increase over the previous dividend of 33 cents per share. The Board of Directors also approved a new share repurchase program, authorizing the company to repurchase up to $8 billion of its Class A common stock. The new share repurchase program will become effective at the completion of the company’s previously announced $6.5 billion program. The company has approximately $300 million remaining under the current program authorization.Alphabet Inc.-GOOGL announced a management change. The change is effective immediately. Larry Page and Sergey Brin, the CEO and President, respectively, of Alphabet, have decided to leave these roles. They will continue their involvement as co-founders, shareholders and members of Alphabet’s Board of Directors. Sundar Pichai, the CEO of Google, becomes the CEO of Google and Alphabet. He will remain the CEO of Google and assumes the role of managing Alphabet’s investment in its portfolio of Other Bets. Pichai will remain a member of Alphabet’s Board of Directors.Biogen-BIIB announced positive top-line results from the Phase 2 LILAC study evaluating the efficacy and safety of BIIB059, a fully humanized IgG1 monoclonal antibody (mAb) targeting blood dendritic cell antigen 2 (BDCA2) expressed on plasmacytoid dendritic cells, in patients with lupus. “There is substantial unmet medical need for people with lupus given the limited number of treatment options available to help manage this difficult-to-treat and chronic disease,” said Nathalie Franchimont, M.D., Ph.D., Vice President, Lupus and Multiple Sclerosis Portfolio at Biogen. “We are excited by the LILAC study results, and the potential for BIIB059 to be a meaningful new treatment option for patients living with lupus. We also believe these results support Biogen’s goal of continuing to build a multi-franchise portfolio by bringing potential new treatment options to people with great unmet medical need.”Canadian National-CNI announced that its recovery plan is on track and that it is revising its guidance following the impact of the 8-day strike. Due to the impact of the strike, estimated at around $0.15 of EPS, CNI is revising its 2019 full year financial outlook, and remains focused on continuing to realign its resources in light of the weaker demand, including its workforce, to address cost takeout efforts that started prior to the strike. CNI is now targeting to deliver 2019 adjusted diluted EPS growth in the low to mid single-digit range versus last year's adjusted diluted EPS of C$5.50, compared with its October 22, 2019 financial outlook which called for adjusted diluted EPS growth in the high single-digit range. Monday, Dec. 2, 2019UnitedHealth Group’s-UNH revenues for 2019 are expected to approximate $242 billion, with net earnings to approach $14.25 per share and adjusted net earnings to approach $15.00 per share, at the higher end of the company’s most recent earnings per share outlook provided with its third quarter 2019 earnings release. Adjusted net earnings exclude from net earnings only the after-tax non-cash amortization expense pertaining to acquisition-related intangible assets. UnitedHealth Group’s 2020 outlook includes revenues of $260 billion to $262 billion, net earnings of $15.45 to $15.75 per share, and adjusted net earnings of $16.25 to $16.55 per share. Cash flows from operations are expected to range from $19.0 billion to $19.5 billion in 2020.General Dynamics-GD was named lead contractor on a $22.2 billion U.S. Navy contract for the construction of nine Virginia-class submarines, the Pentagon said in announcing its largest-ever shipbuilding award.Tuesday, Nov. 26, 2019Hormel Foods-HRL reported fourth quarter revenues declined 1% to $2.5 billion with net income down 2% to $256 million and EPS down 2% to $.47. For the full year, revenues were relatively flat at $9.5 billion with net income and EPS each down 3% to $979 million and $1.80, respectively. Return on shareholders’ equity was 15.5% for the year. Organic volume for the year was flat at 4.74 billion pounds with organic sales up 1% and operating income up 1%. Free cash flow declined 23% during the year to $667 million due to working capital changes as the company strategically built inventory. During the year, the company paid $437 million in dividends, repurchased $174 million of its common stock and repaid $375 million of debt taken on for an acquisition. Thanks to the sale of a business during the year for $480 million, Hormel’s cash and investments increased 50% during the year to $688 million. Hormel announced an 11% increase in its annual dividend to $.93 per share. This is the 54th consecutive year of dividend increases and the 11th consecutive year of double-digit growth in the dividend. Management’s outlook for 2020 is for net sales in the range of $9.5billion-$10.3 billion with EPS expected in the range of $1.69-$1.83. This outlook assumes higher protein prices and further volatility related to the impact from African swine fever and global trade uncertainty. The company expects organic pretax earnings growth of 5%-7%. Results in 2019 included $.10 per share related to CytoSport which was sold during the year.