"Jews for Jesus Development Department Monthly Newsletter" David Stone, Jews for Jesus in San Francisco, California, United States for 
Monday, June 20, 2016Shalom to you, our partners in ministry. It is an honor to share with you the latest news from Washington, Savvy Living, Personal Planning, gift stories, finance news, and timely articles.
There are no "asks" in this eNewsletter as it is designed totally to be a helpful service to you. Feel free to share it with others in your family or your friends. If you would like me to send it directly to them please send me their email address.
This information is put together in a way to be a help in understanding what is happening in our economy so you can use it to your best advantage. I hope this information is useful to you.
If you have any questions or I can be of assistance to you please contact me.
Director of Donor Relations
How to Give Property to Children
How to Give Property to ChildrenParents have a number of reasons for making gifts to children. First, a parent should have sufficient resources for retirement and for long-term care needs before making substantial gifts. Once you have acquired a reasonable level of security, you might consider making gifts to children.
Your gifts to children will enable two types of education. First, your children will have the ability to learn to manage and hopefully invest the gifts to start building their estate. In addition, you will be able to understand better how a child will manage or use the gift property.
Finally, if you have a larger estate, the use of annual gift exclusions can be a very good strategy to save potential future estate taxes.
There are Seven Different Ways That Gifts Can be Made to Children.
1. Cash Gifts: You can simply write a check to children. Some parents give an amount up to the annual gift exclusion ($14,000 per child, per parent in 2016 and larger amounts in future years). This is a very easy and convenient way to make a gift.
However, there are some concerns about cash gifts that you should understand. When gifts to children are in cash, they are quite frequently spent rather than being invested. If the regular gifts are made over a period of years, it may encourage your children to live at a higher than normal lifestyle. In many cases the child will benefit more from a gift of a property investment, rather than a gift of cash.
2. Stock Gifts: While it is possible for you to hold stock certificates, the overwhelming majority of stock is now held in a street account by a brokerage firm. The easiest method for transfer of stock is for the child to create an account with the same firm. The brokerage firm has the documentation necessary to make a transfer from your account to your child's account.
With a property gift, you will need to know the gift value. Because public stock is valued at the mean between the high and low prices on the date of the transfer, the value is quite easy to determine. Most parents will make stock gifts to children with value below the annual exclusion amount. Each parent will have one annual exclusion for each child, so the total given each year for a couple is double the exclusion. In addition, larger gifts can be made by filing an IRS Form 709 Gift Tax Return and using part of your lifetime gift exemption.
If stock or other appreciated property is transferred to children by gift, they take the same cost basis as the parents. Although the stock may be appreciated, there is no capital gains tax payable when the stock is transferred. However, the child has the same basis as the parent. If the stock is sold, the child will pay capital gains tax on the increase in value.
The dividends or income from the stock will be distributed to the child. If he or she is under age 19 or is a student under age 24, then in most cases the income will be taxed to the child at the parent's tax rate. You may have heard this concept called the "kiddie" tax.
3. Mutual Funds: Many parents own mutual funds that are managed by a financial services firm. These may be a very good candidate for a gift to children. You can create a new mutual fund account and use the appropriate form from the financial services company to make a gift to the child. If the mutual fund is appreciated, then the potential capital gain and income tax rules are similar to those described for the gifts of stock.
4. Gifts of Land or Home: A gift of real property is accomplished through a deed. Depending upon your state's rules, a warranty or grant deed is normally used, but in some cases a quitclaim deed may be appropriate. You will identify the property being transferred on the deed. After you sign the gift deed, it will be notarized and recorded with the county registrar of deeds. This will produce clear evidence that the property has been given to your children.
In order to qualify for the gift exclusion limit, you may choose to transfer partial interests in property. This is called an "undivided interest" in the property. For example, if a property is worth $100,000 a parent might deed 10% of that property each year for ten years to a child. The gifts will be less than the gift exclusion and after ten years the child owns the property. If the real property is substantial in value and gifts exceed the annual exclusion, then you will need an appraisal so that the property transferred can be correctly valued on IRS Form 709, Federal Gift Tax Return.
5. Uniform Transfers to Minors Act (UTMA): Under the UTMA, you may transfer property or assets to a custodian for the benefit of a child who is a minor. The custodian serves as the manager of the asset and can invest and spend funds as he or she considers advisable for the use and benefit of the minor. The custodian must maintain tax records and the income is taxed to the child.
When the child reaches legal age (18 in some states, although age 21 is required or permissible in most states), the child then has ownership of the assets.
The UTMA is convenient and relatively easy to manage. If assets are likely to be used for the child's education by age 21, the UTMA can be a good planning strategy. However, if there are fairly substantial assets you may be reluctant to permit a 21-year-old child to have access to large principal amounts.
6. Trust for Children: A child's trust can be quite flexible. Many parents have created trusts for the benefit of one child or even a "family pot" trust for multiple children. The trustee is frequently given permission to use the trust income for the education, living expenses and health needs of the child.
Trustees frequently have broad discretion over trust investments and the use of the funds. The goal of the parents is to provide for the needs of the child yet protect the funds until the child has reached the age of financial responsibility. As a parent, you have the ability to decide what the general guidelines on distributions will be for your trustee and at what age your children will receive their principal from the trust.
7. Tax-free Sale Trust for Children: An attractive option if you have appreciated property is to create a charitable remainder unitrust for a term of 20 years with income payable to children. For example, John and Mary Jones had three children and owned property with a value of $250,000. Because they had paid $50,000 for the property, they were reluctant to sell and pay a capital gains tax of over $45,000.
A much better plan for John and Mary was to transfer the property to a charitable remainder trust paying 6% to their three children for 20 years. They received an income tax deduction of approximately $75,000 and bypassed the capital gains tax. The children each received one-third of the 6% income for 20 years and their total income was approximately $330,000. After the 20 years, the trust had grown to $305,000 and it benefited the favorite charities of John and Mary.
John and Mary were able to enjoy very large tax savings now, transfer an income stream to children for 20 years and eventually benefit their favorite charities. Mary particularly appreciated the ability to give an income stream because one of the three children tended to "spend money like water" and had the opportunity over 20 years to acquire better financial management skills.
SAVVY LIVING
The New MIND Diet May Help Prevent Alzheimer's
The New MIND Diet May Help Prevent Alzheimer's
I've heard that there's a new diet that can help prevent Alzheimer's disease. What can you tell me about this? My 80-year-old mother has Alzheimer's and I want to do everything I can to protect myself.
It's true! Research has found that a new diet plan – called the MIND diet – can have a profound impact on your brain health as you age and can even lower your odds of getting Alzheimer's disease.
The MIND diet takes two proven diets – the heart-healthy Mediterranean diet and the blood-pressure lowering DASH diet – and zeroes in on the foods in each that specifically affect brain health.
The MIND diet, which stands for “Mediterranean-DASH Intervention for Neurodegenerative Delay,” was developed by Martha Clare Morris, a nutritional epidemiologist at Rush University Medical Center, through a study funded by the National Institute on Aging.
The study followed the diets of nearly 1,000 elderly adults. The participants filled out food questionnaires and underwent repeated neurological testing for an average of 4.5 years.
It found participants whose diets most closely followed the MIND recommendations had brains that functioned as if they were 7.5 years younger and it lowered their risk of developing Alzheimer's disease by as much as 53%. Even those who didn't strictly follow the diet reduced their risk of Alzheimer's by 35%.
The MIND Menu
The MIND diet has several different dietary components. The emphasis is on eating from brain-healthy food groups and limiting foods from unhealthy groups. Here's a rundown of the healthy foods you should work into your diet:
One of the best things about the MIND diet is that it's easier to follow than most other diets and you don't have to stick to it perfectly to gain the benefits, which makes it easier to follow for a long time. And the longer you eat the MIND way, the lower the risk of getting Alzheimer's disease.
Another advantage is that the MIND diet can help you lose some weight too, if you keep your portions in check and are careful about how the food is prepared.
It's also important to understand that even though diet plays a big role, it's only one aspect of Alzheimer's disease. Getting regular exercise, quitting smoking (if you smoke) and learning how to manage stress can even further reduce your risk of Alzheimer's.
Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living” book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization’s official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.
The New MIND Diet May Help Prevent Alzheimer's
The New MIND Diet May Help Prevent Alzheimer's
I've heard that there's a new diet that can help prevent Alzheimer's disease. What can you tell me about this? My 80-year-old mother has Alzheimer's and I want to do everything I can to protect myself.
It's true! Research has found that a new diet plan – called the MIND diet – can have a profound impact on your brain health as you age and can even lower your odds of getting Alzheimer's disease.
The MIND diet takes two proven diets – the heart-healthy Mediterranean diet and the blood-pressure lowering DASH diet – and zeroes in on the foods in each that specifically affect brain health.
The MIND diet, which stands for “Mediterranean-DASH Intervention for Neurodegenerative Delay,” was developed by Martha Clare Morris, a nutritional epidemiologist at Rush University Medical Center, through a study funded by the National Institute on Aging.
The study followed the diets of nearly 1,000 elderly adults. The participants filled out food questionnaires and underwent repeated neurological testing for an average of 4.5 years.
It found participants whose diets most closely followed the MIND recommendations had brains that functioned as if they were 7.5 years younger and it lowered their risk of developing Alzheimer's disease by as much as 53%. Even those who didn't strictly follow the diet reduced their risk of Alzheimer's by 35%.
The MIND Menu
The MIND diet has several different dietary components. The emphasis is on eating from brain-healthy food groups and limiting foods from unhealthy groups. Here's a rundown of the healthy foods you should work into your diet:
- Green leafy vegetables (like spinach and salad greens): Eat at least one serving per day.
- Other vegetables: At least one other vegetable a day.
- Whole grains: Three or more servings a day.
- Nuts: Five one-ounce servings a week.
- Beans: At least three servings a week.
- Berries: Two or more servings a week.
- Fish: Once a week.
- Poultry (not fried): Two times a week.
- Olive oil: Use it as your primary cooking oil.
- Red meat: Eat fewer than four servings a week.
- Butter and margarine: Less than a tablespoon daily.
- Cheese: Less than one serving a week.
- Pastries and sweets: Less than five servings a week.
- Fried or fast food: Less than one serving a week.
One of the best things about the MIND diet is that it's easier to follow than most other diets and you don't have to stick to it perfectly to gain the benefits, which makes it easier to follow for a long time. And the longer you eat the MIND way, the lower the risk of getting Alzheimer's disease.
Another advantage is that the MIND diet can help you lose some weight too, if you keep your portions in check and are careful about how the food is prepared.
It's also important to understand that even though diet plays a big role, it's only one aspect of Alzheimer's disease. Getting regular exercise, quitting smoking (if you smoke) and learning how to manage stress can even further reduce your risk of Alzheimer's.
Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living” book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization’s official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.
YOUR PLAN
Flexible Deferred Gift Annuity
Lewis is a 54-year-old executive at a large healthcare company. He purchased company stock during years when the stock price was low, and now the stock has grown substantially.
Lewis and his spouse, Ann, sold a vacation home earlier this year and are looking for a way to offset the capital gain tax owed on the sale. Lewis enjoys the challenge and responsibility of his job and is not quite ready to retire. But, he is looking at planning options that will provide income in the future with the flexibility to retire when he is ready.
Ann: We needed a charitable deduction to avoid paying the taxes we owed from the sale of our second home. While Lewis invested his energies at work, I spent years volunteering with our favorite charity and wanted to find a way to make a special gift to help further its work this year.
Lewis: Ann and I were both in good health and I still enjoyed working. We were living comfortably on my current salary, but were looking for ways to plan for retirement in the future. I wasn't quite certain when I would retire, so we wanted to find an income source that would permit me to be flexible with my retirement date.
Ann: A gift planner from our favorite charity told us that a flexible deferred gift annuity would help us meet our goals. Instead of selling our appreciated stock and paying high capital gain tax, we could give it to them and receive an immediate charitable tax deduction to offset our current tax bill. The flexible deferred gift annuity would permit us to elect to begin taking payments for life when Lewis was ready to retire.
Lewis: We decided to set up the flexible deferred gift annuity and were able to achieve all of our goals. We received a charitable tax deduction in the year that the gift was made and experienced immediate tax savings. When I am ready to retire, we will contact our favorite charity to begin payments, giving me the flexibility to continue working as long as I would like. In addition, the flexible deferred gift annuity makes it possible for us to receive a large portion of our income tax free, and this is an attractive benefit!
*Please note: The name and image above is representative of a typical donor and may or may not be an actual donor to our organization. Since your gift annuity benefits may be different, you may want to click here to view a color example of your benefits.
Flexible Deferred Gift Annuity
Lewis is a 54-year-old executive at a large healthcare company. He purchased company stock during years when the stock price was low, and now the stock has grown substantially.
Lewis and his spouse, Ann, sold a vacation home earlier this year and are looking for a way to offset the capital gain tax owed on the sale. Lewis enjoys the challenge and responsibility of his job and is not quite ready to retire. But, he is looking at planning options that will provide income in the future with the flexibility to retire when he is ready.
Ann: We needed a charitable deduction to avoid paying the taxes we owed from the sale of our second home. While Lewis invested his energies at work, I spent years volunteering with our favorite charity and wanted to find a way to make a special gift to help further its work this year.
Lewis: Ann and I were both in good health and I still enjoyed working. We were living comfortably on my current salary, but were looking for ways to plan for retirement in the future. I wasn't quite certain when I would retire, so we wanted to find an income source that would permit me to be flexible with my retirement date.
Ann: A gift planner from our favorite charity told us that a flexible deferred gift annuity would help us meet our goals. Instead of selling our appreciated stock and paying high capital gain tax, we could give it to them and receive an immediate charitable tax deduction to offset our current tax bill. The flexible deferred gift annuity would permit us to elect to begin taking payments for life when Lewis was ready to retire.
Lewis: We decided to set up the flexible deferred gift annuity and were able to achieve all of our goals. We received a charitable tax deduction in the year that the gift was made and experienced immediate tax savings. When I am ready to retire, we will contact our favorite charity to begin payments, giving me the flexibility to continue working as long as I would like. In addition, the flexible deferred gift annuity makes it possible for us to receive a large portion of our income tax free, and this is an attractive benefit!
*Please note: The name and image above is representative of a typical donor and may or may not be an actual donor to our organization. Since your gift annuity benefits may be different, you may want to click here to view a color example of your benefits.
WASHINGTON NEWS
IRS Design Challenge Winners
IRS Design Challenge Winners
On June 10, the IRS announced the winners of its first “Tax Design Challenge.” This innovative crowdsourcing competition was designed to gather ideas to enhance the taxpayer experience.
Andrew Miller of San Francisco won both the “Overall Design” $10,000 reward and the “Best Taxpayer Usefulness” $2,000 reward. He is a web developer and specialist in user-interface design.
Miller created “IRS MyService” with a dashboard and tax return summary cards. His design also included a profile section and individual notifications. His design received high marks because it was responsive and worked well on phones.
Second place for “Overall Design” went to Andrea Angquist of San Francisco. She is a Silicon Valley web developer. Her “IRS 365” designs focused on easy-to-use screens for accessing tax information on a smartphone.
Both winners were evaluated on “Overall Appeal, Taxpayer Usefulness, Financial Capability, Visual Hierarchy, Information Density and Accessibility.”
Other winners in the “Financial Capability” category were Sam Nguyen and Vidhika Bansal of Washington DC. They suggested a concept called “Taxes.” Second in this category was Dante Vono of Minnesota for an application with the title “MyTax Online.”
Editor’s Note: This crowdsourcing plan is an excellent concept. The IRS benefits from very experienced and high-quality web designers. Hopefully, many of these user-friendly concepts will be included in future versions of www.IRS.gov.
Stocks - Oracle's Traditional Software Slows, Cloud Rises
Oracle's Traditional Software Slows, Cloud Rises
Oracle Corp. (ORCL) released its fourth quarter earnings on Thursday, June 16. Earnings were boosted by Oracle's cloud business, which experienced a 49% increase in revenue.
Oracle reported revenue of $10.59 billion in the fourth quarter. This was a 1% fall from last year's fourth quarter revenue of $10.71 billion.
"Fourth quarter [cloud software as a service (SaaS) and platform as a service (PaaS)] revenue growth accelerated to 68% in constant currency, significantly higher than my guidance," said Oracle CEO, Safra Catz. "SaaS and PaaS gross margins continued to improve throughout the year, exiting FY16 at 56%. Bookings in Q4 were also very strong enabling us to raise our guidance for Q1 SaaS and PaaS revenue growth, which we now expect to be between 75% and 80%."
Oracle reported that net income in the fourth quarter was $2.81 billion, up from $2.76 billion a year ago. On an earnings per share basis, profit rose to $0.66 a share compared to $0.62 a share in the same quarter last year.
Oracle develops, manufactures, markets, sells, hosts and supports database software, cloud infrastructure, hardware products and services. Like other tech companies, Oracle is shifting toward web-based cloud services rather than installed software. Oracle's traditional software business continued to slow during the fourth quarter, as revenue from new software licenses fell 12%.
Oracle Corp. (ORCL) shares ended the week at $39.68, up 3.0% for the week.
Kroger Continues 50-Quarter Growth StreakThe Kroger Co. (KR) announced its first quarter earnings on Thursday, June 16. This quarter marked the fiftieth consecutive quarter of positive supermarket sales growth, excluding fuel.
The supermarket chain posted revenue of $34.6 billion, up from last year's first quarter revenue of $33.1 billion. While revenue continues to increase, same-store sales growth is slowing, increasing only 2.4% in the first quarter compared to 3.9% in the fourth quarter.
"We are very pleased with a solid quarter during which we continued to strengthen our connection with customers and expand our ClickList offering to more customers in more markets," said Kroger CEO Rodney McMullen. "Fifty consecutive quarters of positive identical supermarket sales growth, excluding fuel, is extraordinary."
Kroger announced earnings of $680 million, or $0.70 per share. Last year at this time, Kroger reported earnings of $619 million, or $0.62 per share.
Kroger, the largest supermarket chain and second-largest retail food seller after Wal-Mart Stores Inc., has stepped up efforts to attract new customers and fend off competition. In addition to its acquisition of the Midwestern supermarket company Roundy's last year, Kroger has directed its efforts toward increasing its natural and organic food offerings. The supermarket chain has expanded its online ordering and pickup service, "Clicklist," to 25 markets, up from only seven markets in the previous quarter.
The Kroger Co. (KR) shares ended the week at $35.18, down 3.6% for the week.
Rite Aid's Earnings DisappointRite Aid Corporation (RAD) announced quarterly earnings on Thursday, June 16. The company reported increased revenue, but fell below analysts' expectations.
Rite Aid reported that revenue for the first quarter was $8.18 billion compared to $6.65 billion in the first quarter last year. The figure missed the $8.26 billion revenue mark predicted by analysts.
"Our results for the first quarter reflect strong performance in our Pharmacy Services Segment and our front-end business as well as good overall expense control," said Chairman and CEO John Standley. "Our challenge was pharmacy reimbursement rate pressure, which we were unable to offset largely due to drug purchasing efficiencies that did not meet our expectations."
The company reported a loss in profit of $4.6 million. Adjusted earnings per share for the first quarter were $0.01, down from a year ago when adjusted earnings per share in the first quarter were reported at $0.02.
Rite Aid, the third-largest drugstore chain in the U.S., has faced challenges recently due to lower reimbursement rates, which have prevented the company from meeting expectations in the area of drug cost reduction. The company continues to increase its number of "RediClinics" and remodel its wellness stores, bringing the company's total store count to 4,560. In October, Rite Aid entered into a $17.2 billion agreement to be acquired by the nation's largest drugstore operator, Walgreens Boots Alliance Inc. While the merger is still awaiting regulatory approval, Rite Aid announced on Thursday that it anticipates the merger to close before year's end.
Rite Aid Corporation (RAD) shares ended the week at $7.78, down 0.6% for the week.
The Dow started the week of 6/13 at 17,830 and closed at 17,675 on 6/17. The S&P 500 started the week at 2,092 and closed at 2,071. The NASDAQ started the week at 4,868 and closed at 4,800.
IRS Design Challenge Winners
IRS Design Challenge Winners
On June 10, the IRS announced the winners of its first “Tax Design Challenge.” This innovative crowdsourcing competition was designed to gather ideas to enhance the taxpayer experience.
Andrew Miller of San Francisco won both the “Overall Design” $10,000 reward and the “Best Taxpayer Usefulness” $2,000 reward. He is a web developer and specialist in user-interface design.
Miller created “IRS MyService” with a dashboard and tax return summary cards. His design also included a profile section and individual notifications. His design received high marks because it was responsive and worked well on phones.
Second place for “Overall Design” went to Andrea Angquist of San Francisco. She is a Silicon Valley web developer. Her “IRS 365” designs focused on easy-to-use screens for accessing tax information on a smartphone.
Both winners were evaluated on “Overall Appeal, Taxpayer Usefulness, Financial Capability, Visual Hierarchy, Information Density and Accessibility.”
Other winners in the “Financial Capability” category were Sam Nguyen and Vidhika Bansal of Washington DC. They suggested a concept called “Taxes.” Second in this category was Dante Vono of Minnesota for an application with the title “MyTax Online.”
Editor’s Note: This crowdsourcing plan is an excellent concept. The IRS benefits from very experienced and high-quality web designers. Hopefully, many of these user-friendly concepts will be included in future versions of www.IRS.gov.
FINANCES
Stocks - Oracle's Traditional Software Slows, Cloud Rises
Oracle's Traditional Software Slows, Cloud Rises
Oracle Corp. (ORCL) released its fourth quarter earnings on Thursday, June 16. Earnings were boosted by Oracle's cloud business, which experienced a 49% increase in revenue.
Oracle reported revenue of $10.59 billion in the fourth quarter. This was a 1% fall from last year's fourth quarter revenue of $10.71 billion.
"Fourth quarter [cloud software as a service (SaaS) and platform as a service (PaaS)] revenue growth accelerated to 68% in constant currency, significantly higher than my guidance," said Oracle CEO, Safra Catz. "SaaS and PaaS gross margins continued to improve throughout the year, exiting FY16 at 56%. Bookings in Q4 were also very strong enabling us to raise our guidance for Q1 SaaS and PaaS revenue growth, which we now expect to be between 75% and 80%."
Oracle reported that net income in the fourth quarter was $2.81 billion, up from $2.76 billion a year ago. On an earnings per share basis, profit rose to $0.66 a share compared to $0.62 a share in the same quarter last year.
Oracle develops, manufactures, markets, sells, hosts and supports database software, cloud infrastructure, hardware products and services. Like other tech companies, Oracle is shifting toward web-based cloud services rather than installed software. Oracle's traditional software business continued to slow during the fourth quarter, as revenue from new software licenses fell 12%.
Oracle Corp. (ORCL) shares ended the week at $39.68, up 3.0% for the week.
Kroger Continues 50-Quarter Growth StreakThe Kroger Co. (KR) announced its first quarter earnings on Thursday, June 16. This quarter marked the fiftieth consecutive quarter of positive supermarket sales growth, excluding fuel.
The supermarket chain posted revenue of $34.6 billion, up from last year's first quarter revenue of $33.1 billion. While revenue continues to increase, same-store sales growth is slowing, increasing only 2.4% in the first quarter compared to 3.9% in the fourth quarter.
"We are very pleased with a solid quarter during which we continued to strengthen our connection with customers and expand our ClickList offering to more customers in more markets," said Kroger CEO Rodney McMullen. "Fifty consecutive quarters of positive identical supermarket sales growth, excluding fuel, is extraordinary."
Kroger announced earnings of $680 million, or $0.70 per share. Last year at this time, Kroger reported earnings of $619 million, or $0.62 per share.
Kroger, the largest supermarket chain and second-largest retail food seller after Wal-Mart Stores Inc., has stepped up efforts to attract new customers and fend off competition. In addition to its acquisition of the Midwestern supermarket company Roundy's last year, Kroger has directed its efforts toward increasing its natural and organic food offerings. The supermarket chain has expanded its online ordering and pickup service, "Clicklist," to 25 markets, up from only seven markets in the previous quarter.
The Kroger Co. (KR) shares ended the week at $35.18, down 3.6% for the week.
Rite Aid's Earnings DisappointRite Aid Corporation (RAD) announced quarterly earnings on Thursday, June 16. The company reported increased revenue, but fell below analysts' expectations.
Rite Aid reported that revenue for the first quarter was $8.18 billion compared to $6.65 billion in the first quarter last year. The figure missed the $8.26 billion revenue mark predicted by analysts.
"Our results for the first quarter reflect strong performance in our Pharmacy Services Segment and our front-end business as well as good overall expense control," said Chairman and CEO John Standley. "Our challenge was pharmacy reimbursement rate pressure, which we were unable to offset largely due to drug purchasing efficiencies that did not meet our expectations."
The company reported a loss in profit of $4.6 million. Adjusted earnings per share for the first quarter were $0.01, down from a year ago when adjusted earnings per share in the first quarter were reported at $0.02.
Rite Aid, the third-largest drugstore chain in the U.S., has faced challenges recently due to lower reimbursement rates, which have prevented the company from meeting expectations in the area of drug cost reduction. The company continues to increase its number of "RediClinics" and remodel its wellness stores, bringing the company's total store count to 4,560. In October, Rite Aid entered into a $17.2 billion agreement to be acquired by the nation's largest drugstore operator, Walgreens Boots Alliance Inc. While the merger is still awaiting regulatory approval, Rite Aid announced on Thursday that it anticipates the merger to close before year's end.
Rite Aid Corporation (RAD) shares ended the week at $7.78, down 0.6% for the week.
The Dow started the week of 6/13 at 17,830 and closed at 17,675 on 6/17. The S&P 500 started the week at 2,092 and closed at 2,071. The NASDAQ started the week at 4,868 and closed at 4,800.
Bonds - Yields Continue Decline Amid Global Uncertainty
Yields Continue Decline Amid Global Uncertainty
Yields Continue Decline Amid Global Uncertainty
U.S. benchmark Treasury yields tumbled to their lowest level since August 2012 on Thursday as Japan's decision not to add stimulus, coupled with the Fed's Wednesday announcement that it will not be raising interest rates, further fueled the already increased demand for safe-haven U.S. bonds. Yields have been steadily decreasing as investors speculate whether or not the U.K. will leave the European Union.
The Bank of Japan's (BOJ) decision to leave its monetary policies unchanged caused global stocks to fall. Despite the yen surging to its strongest levels in over two years on Thursday, the BOJ decide to hold back from boosting its stimulus amid the growing concern surrounding the tumultuous state of the global economy.
"The BOJ will have to take bold action to arrest the strengthening yen," said Takeshi Minami, chief economist at Norinchukin Research Institute. "With the Brexit vote ahead, the BOJ couldn't move this time because the result on June 23 may erase the impact of whatever it did now."
Fears regarding a financial disruption in the wake of the U.K.'s vote next week were put on hold following the death of British Parliament member Jo Cox. On Thursday, British politicians suspended campaigning for next week's vote and responded to Cox's death, giving yields a chance to retreat slightly from their continued fall.
"[There] is no doubt that a pause in the campaign is giving a breather to European equities and also allowing for some consolidation after a big rally in bonds," said David Schnautz, fixed income strategist at Commerzbank. Despite the slight reprieve, yields continue to hover around a four-week low.
The 10-year Treasury note yield finished the week of 6/13 at 1.62%, while the 30-year Treasury note yield was 2.43%.
CDs and Mortgages - Interest Rates Decline for Second Straight Week
Interest Rates Decline for Second Straight Week
Interest Rates Decline for Second Straight Week
Freddie Mac released its latest Primary Mortgage Market Survey (PMMS) on Thursday, June 16. The report revealed interest rates declining for the second consecutive week.
The 30-year fixed rate mortgage averaged 3.54% this week. This represents a decrease from last week when it averaged 3.60%. Last year at this time, the 30-year fixed rate mortgage averaged 4.00%.
This week, the 15-year fixed rate mortgage averaged 2.81%. This was lower than last week when it averaged 2.87%. The 15-year fixed rate mortgage averaged 3.23% one year ago.
"The 10-year Treasury yield continued its free fall this week as global risks and expectations for the Fed's June meeting drove investors to the safety of government bonds," said Sean Becketti, Chief Economist at Freddie Mac. "The 30-year mortgage rate responded by falling 6 basis points for the second straight week to 3.54% – yet another low for 2016. Wednesday's Fed decision to once again stand pat on rates, as well as growing anticipation of the U.K.'s upcoming European Union referendum will make it difficult for Treasury yields and – more importantly – mortgage rates to substantially rise in the upcoming weeks."
Based on published national averages, the money market account finished the week of 6/13 at 0.54%. The 1-year CD finished at 1.08%.
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Thank you for your interest in planned giving. To access any of our resources, please go to our website.
Your Brother in Yeshua (Jesus),
David Stone
Jews for Jesus
60 Haight Street
Your Brother in Yeshua (Jesus),
David Stone
Jews for Jesus
60 Haight Street
San Francisco, California 94102, United States
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