At a time when many young people are struggling to get ahead, NPower Texas is expanding its flagship Tech Fundamentals program to Dallas-Fort Worth. The free training gives 18- to 26-year-olds the opportunity to skill up for in-demand tech jobs that are forecasted to grow in 2022.
NPower has extended the application deadline for its next training cohort to August 15.
The free, 16-week virtual training program was created for young adults from underserved and marginalized communities in Dallas-Fort Worth, as well as military veterans and their spouses.
NPower’s Tech Fundamentals program teaches students the basics of programming and information technology and offers students opportunities to earn various certifications.
Mission: Moving people from poverty to the middle class
NPower is a national nonprofit with a mission to move people from poverty to the middle class. Its free tech training program for young people is backed by corporations and by donations from billionaires such as novelist and philanthropist MacKenzie Scott, the former wife of billionaire Amazon owner Jeff Bezos, who donated $15 million to NPower last March.
NPower graduate success stories
Rasheda Walker is an NPower Tech Fundamentals graduate and an apprentice at CITI. [Photo: NPower]
Two exact NPower Tech Fundamentals graduates showcase the program’s success.
Before joining the NPower program, Rasheda Walker was facing the most difficult period of her life. She recognized the need to obtain skills and training to ease the life stressor which affected her strength to overcome many personal challenges, NPower said.
When she saw the organization at a veteran’s job fair, she grabbed the opportunity for its free training and the opportunities it could provide. She ended up getting not only tech instruction, but much-needed social support as well.
“It’s OK to be a beginner at something,” Walker said in a statement, “because you can continue to learn and develop.”
In a little over five months, she learned new technical and life skills, earned multiple certifications, and has begun an apprenticeship with CITI.
Pravin Shrestha is an NPower Tech Fundamentals graduate. [Photo: NPower]
“I could not have imagined these accomplishments a short while ago,” Walker said. “With my new skills, I plan to work hard as an apprentice with the goal to obtain a full-time career in a specialized field, then move on to advanced training
Pravin Shrestha, a Fall 2021 graduate of the program, was the first in his family to come to the U.S, and pursue his education.
He graduated from Brookhaven College in Farmers Branch, then got an undergraduate degree from East Central University. After joining the Army Reserve, he started his own business, but wanted to explore a career in IT.
After the pandemic hit, he heard about NPower, sold his business, and took the organization’s professional development classes. He completed his own successful apprenticeship with CITI and has recently been promoted to a full-time role as a compliance anti-money laundering analyst.
Dallas-Fort Worth ‘has so much untapped potential’ for tech labor
Jonathan Pride, executive director of NPower Texas. [Photo: LinkedIn]
Jonathan Pride, executive director of NPower Texas, says expanding into Dallas-Fort Worth was a long time coming. The region has “so much untapped potential in the form of underserved young adults and veterans,” Pride says.
The program’s effectiveness elsewhere provides a strong blueprint for success in Texas.
“NPower Texas is one of the fastest-growing work training hubs in the U.S.” he said, noting that DFW is home to the fifth-largest tech labor force in the country.
NPower’s program was created to help businesses find new tech talent and young adults launch new careers.
NPower Texas located at innovation center south of downtown Dallas
NPower Texas is located within Dallas College’s Bill J. Priest Small Business Innovation Center, just south of downtown Dallas. Since 2013, the nonprofit has provided tuition-free tech training and certifications to veterans and their spouses. According to the NPower website, it offers an “alternative fast-track to tech jobs” with employers committed to hiring diverse IT talent.
80% of graduates get a full-time job or continue education; average salary jump of 384%
Students who enter NPower’s program earn industry-recognized certifications and graduate with the competencies of an IT professional with one to two years of experience, NPower said in a statement. The nonprofit also places its young students in paid internships with corporate and nonprofit organizations.
According to national data from NPower, the nonprofit said that 80% of its graduates get a full-time job or continue their education and that its graduates see an average salary increase of 384%.
Veterans program is supported by grant
The veterans program is supported by a grant from the Texas Veterans Commission Fund for Veterans’ Assistance, which provides grants to organizations serving veterans and their families.
More than 400,000 veterans and their spouses living in North Texas are underemployed, NPower said, and are challenged to adapt to the specialized workforce.
More than 50% of all jobs require tech or digital skills
NPower noted that in today’s economy, more than 50% of all jobs require some degree of technology and digital skill. A exact Microsoft Data Science report estimates that U.S. digital job capacity—the total number of new technology-oriented jobs—will grow to 13 million by 2025, NPower said.
Beyond Texas, NPower operates in New York, California, Maryland, Toronto, New Jersey, Missouri, and Michigan.
To apply or for more information, visit the nonprofit’s website.
Sign up to keep your eye on what’s new and next in Dallas-Fort Worth, every day.
Build upon the fundamentals of computational thinking and programming with this series, developed to support teachers and students through the Cambridge IGCSE™ and O Level Computer Science syllabuses (0478/0984/2210). Bring computer science to life through real-life contexts and applications, including case studies from Microsoft Research®. A three-tiered approach to programming tasks across the coursebook and programming books develops both skills and confidence for students of all levels of understanding. In response to syllabus updates our programming books now cover Java, Python and Visual Basic, offering tailored support for each of the programming languages recommended in the syllabus. Our teacher’s resource now includes over 200 teaching activity ideas, teaching plans, language support, homework ideas and differentiated worksheets, giving you and your students plenty of ways to bring computer science into your world.
Rich Polk
Thesis
On January 18, the tech giant Microsoft (NASDAQ:MSFT) announced it was buying video game developer Activision Blizzard (NASDAQ:NASDAQ:ATVI) for $68.7 billion. The fact of the next major purchase of Microsoft did not surprise investors since the company makes acquisitions several times a year and has a large amount of cash on its balance sheet just for such cases. The deal is expected to be the biggest deal in the video game industry in history.
visualcapitalist.com
Microsoft will pay $95 per share at the close of the deal. However, ATVI stock is trading well below these levels as investors are worried that the deal might collapse under regulation pressure.
In this article, I will be discussing not so much the fate of the deal itself, but the fate of Activision Blizzard if it won't become a part of the Microsoft gaming segment.
The deal collapse
At first glance, it may seem that fears that the deal will be blocked are exaggerated, since:
- Activision and Microsoft's gaming revenue last year accounted for just 13.9% of total global video game spending ($16.28 + $8.8 billion vs. $180.3 billion). Microsoft itself noted that the combined company will take only third place in the market, behind China's Tencent and Japan's Sony Group.
chart by author (NewZoo data)
- Regulators are keeping a close eye on all major acquisitions, while the Microsoft-Activision deal is the biggest so far in 2022.
- Even if the regulators will try to block the deal, it will be almost impossible for them to justify this decision in court due to the small market share of both companies.
While these are all fair points, regulators still have room to maneuver. The thing is FTC, CMA and others might argue that Microsoft is not allowed to promote its games in its store. Besides, the corporation may want to provide its products exclusive rights to, for example, early access to Activision Blizzard games. That might also cause dissatisfaction with regulators.
It is important to remember that despite the size and vast experience of Microsoft in such acquisitions, the deal with Activison Blizzard will be the biggest deal in Microsoft history and its success cannot be guaranteed.
Back to fundamentals
The market is now living in expectations and completely ignoring the fundamental part of Activision Blizzard. Investors are only interested in the deal itself as fundamental factors will not affect the result of the acquisition in any way.
This will certainly change, however, if both companies will go their separate ways.
The most efficient gaming company
The business model is built primarily around in-game purchases. This creates additional benefits for the company.
The operating margin of 36% is well above the sector average of 18% (author's estimates).
The net profit margin is also significantly higher than that of competitors, confirming the success of the strategy.
Growth rates
Activision also shows high growth rates as it showed the highest revenue and profit growth over the past 5 years with only Take Two (NASDAQ:TTWO) running ahead.
Valuation
Although it is hard to predict how deep ATVI will fall if the deal fails, it would be fair to proceed from the price before the announcement of the deal (-18.3%).
Thus, the forward P/E ratio would be around 22, which is a bit higher than the industry average.
It is more likely though that Activision will also be caught in the middle of a market panic and fall another 15%-20% as the NASDAQ 100 Index is down from January 15200 points (-17%). Given the profitability of the company, this price might be very attractive. So, this might be a good deal in the long run.
Business model
Activision has one of the most reliable and profitable games in the industry. The cumulative sales of the Call of Duty franchise reached phenomenal 425 million copies worldwide. 19 years have passed since the first "Call of Duty" game was released. Activision is set to release another premium game "Call of Duty: Modern Warfare II" this fall.
tweaktown.com
As said earlier, the business model is built primarily on in-game purchases. Talking specifics, two free-to-play games were released, "Call of Duty: Warzone" and "Call of Duty: Mobile" in the first quarter of 2020 and the fourth quarter of 2019 respectively. In Q1 2021, Activision segment revenue grew 72% YoY, driven by in-game purchases of these two games, while operating income almost doubled.
Sales of Activision products are growing much slower than in-game sales. It is faster and far more efficient to make games without global changes, which will more than pay off with in-game sales.
All major companies in the industry are now trying to switch to in-game sales systems, as this is a much more stable source of income. This approach removes dependence on specific products. But none of the competitors are as efficient as Activision Blizzard.
Coupled with successful names that have huge fanbases, which in turn are one of the biggest sources of income, the business model is incredibly sustainable, successful and far more efficient than the competitors' one.
While the deal with Microsoft will provide Activision access to almost unlimited development resources, the company remains one step ahead of lagging competitors that rely more on product sales than successful franchises with sustainable in-game revenues.
Reputation risks
In 2021, the scandal erupted causing Activision Blizzard stock to plummet.
A lawsuit was filed, accusing employees of discrimination against employees, sexual harassment against them, unfair pay, and other manifestations of harassment.
For years, women workers of Activision Blizzard, have been forced to put up with unacceptable policies, facing career barriers, unfair layoffs, and humiliation, according to data compiled by the department.
Activision Blizzard fired 30 employees, punished 44 more, and paid $18 million to victims. The main risks are reputational as it will be more difficult in the future to attract new employees.
If the deal with Microsoft is closed, then the corporation itself will reorganize the game studio. However, if the deal falls through, then Activision will have to clear its own name. I believe that a successful reorganization is more than possible, as this is not one of those scandals that will stigmatize a company for the rest of its days. Most likely, Bobby Kotick, who, according to the WSJ investigation, allegedly covered up cases of inappropriate behavior and harassment, and also threatened employees, will have to leave the company. This may cause medium-term panic among investors. However, I believe that the company will be able to solve the problems and rush into a brighter future.
Conclusion
Since there is a chance that the deal will fail, I felt it necessary to look at the future of Activision Blizzard outside of Microsoft's gaming segment. I believe that Activision will still be a successful huge corporation with a stable successful business model.
Of course, the purchase of the company by Microsoft will provide Activision access to huge resources and new projects, but the company itself will feel good and continue to be the best choice among gaming companies.
I would rate a non-Microsoft's Activision as a quality long-term buy.
‘A timely description of diverse sources of energy supply around the world, with supplementary material on energy demand, climate change, and energy-access issues in Africa.'
Robert N. Stavins - A. J. Meyer Professor of Energy and Economic Development, John F. Kennedy School of Government, Harvard University, Massachusetts
‘A comprehensive, rigorous, fact-based portrayal of the fundamentals of energy discourse. A multidisciplinary approach makes this highly valuable to both experts and broader audiences seeking to understand debates on energy security, climate change and development policy.'
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‘This book is a real instrument for the daily work. A window and an introduction to understanding the greatest challenges of our time, from climate change to access to energy in developing countries.'
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‘This book offers a concise, up-to-date, authoritative account of key features of the global energy system. Tagliapietra, a highly respected energy expert and academic researcher, places energy alternatives in the context of changing technologies, markets, geopolitics, and the challenges of climate change and energy access. This overview will help general readers and energy certified gain new insights on the pathways to sustainable energy for all.'
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'… a very readable introduction to the energy sector … This book will be very useful in introductory energy policy courses; chapters provide "key takeaways" that can serve as discussion courses and study guides. Journalists, policy staff, advocates, and anyone needing to come up to speed on energy policy can use this as a good, quick backgrounder. Highly recommended.'
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‘Tagliapietra’s book provides an invitation to further exploration and learning, and as such would be useful as a text in a wide variety of economics, politics, public policy, law, engineering, and management courses. It will also be a valuable resource to policymakers and their staff …’
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Microsoft (NASDAQ:MSFT) has had a rough three months with its share price down 14%. However, a closer look at its sound financials might cause you to think again. Given that fundamentals usually drive long-term market outcomes, the company is worth looking at. In this article, we decided to focus on Microsoft's ROE.
Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company's shareholders.
View our latest analysis for Microsoft
How Do You Calculate Return On Equity?
The formula for return on equity is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Microsoft is:
44% = US$72b ÷ US$163b (Based on the trailing twelve months to March 2022).
The 'return' is the income the business earned over the last year. So, this means that for every $1 of its shareholder's investments, the company generates a profit of $0.44.
What Has ROE Got To Do With Earnings Growth?
So far, we've learned that ROE is a measure of a company's profitability. Depending on how much of these profits the company reinvests or "retains", and how effectively it does so, we are then able to assess a company’s earnings growth potential. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes.
Microsoft's Earnings Growth And 44% ROE
To begin with, Microsoft has a pretty high ROE which is interesting. Secondly, even when compared to the industry average of 12% the company's ROE is quite impressive. As a result, Microsoft's exceptional 28% net income growth seen over the past five years, doesn't come as a surprise.
Next, on comparing Microsoft's net income growth with the industry, we found that the company's reported growth is similar to the industry average growth rate of 25% in the same period.
Earnings growth is a huge factor in stock valuation. It’s important for an investor to know whether the market has priced in the company's expected earnings growth (or decline). By doing so, they will have an idea if the stock is headed into clear blue waters or if swampy waters await. What is MSFT worth today? The intrinsic value infographic in our free research report helps visualize whether MSFT is currently mispriced by the market.
Is Microsoft Making Efficient Use Of Its Profits?
The three-year median payout ratio for Microsoft is 33%, which is moderately low. The company is retaining the remaining 67%. So it seems that Microsoft is reinvesting efficiently in a way that it sees impressive growth in its earnings (discussed above) and pays a dividend that's well covered.
Besides, Microsoft has been paying dividends for at least ten years or more. This shows that the company is committed to sharing profits with its shareholders. Our latest analyst data shows that the future payout ratio of the company is expected to drop to 21% over the next three years. Still forecasts suggest that Microsoft's future ROE will drop to 35% even though the the company's payout ratio is expected to decrease. This suggests that there could be other factors could driving the anticipated decline in the company's ROE.
Summary
On the whole, we feel that Microsoft's performance has been quite good. In particular, it's great to see that the company is investing heavily into its business and along with a high rate of return, that has resulted in a sizeable growth in its earnings. Having said that, the company's earnings growth is expected to slow down, as forecasted in the current analyst estimates. To know more about the latest analysts predictions for the company, check out this visualization of analyst forecasts for the company.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Migration to new hyperscale datacenter region promises greater innovation, sustainability and skills to deliver the future of transport
Microsoft and Auckland Transport (AT) today announced an agreement aimed at dramatically boosting agility and innovation, reducing costs and improving sustainability in transport services.
The central plank of the agreement involves shifting AT’s data and computing from on-premises servers to Microsoft Azure cloud. As part of the agreement, Microsoft is training AT employees in cloud fundamentals, security and other digital skills to help them get the most from emerging technologies. Not only does this investment in its team help attract and retain the best people, it also enables AT to shift its focus from business as usual to exploring innovative ways technology can be harnessed to create new services and enhanced experiences.
Aucklanders will also benefit from cost savings and the extra agility and efficiency public cloud creates for AT. During times of high demand, AT will no longer need to wait for more physical servers to be ordered – public cloud services can simply expand to deliver extra capacity as needed, coping instantly with more web traffic, transport service updates and card top-up requests. If demand ever falls again, like it did during the Covid lockdowns, AT also won’t be left paying for unused infrastructure. Meanwhile, next-generation security services will boost the resilience of AT’s transport systems and better protect customer data.
Roger Jones, Executive General Manager Business Technology at AT, said he was also thrilled to have found a technology partner whose sustainability values and strategy aligned so well with the organisation’s, supporting the sustainability of the city as much as our environment.
“At its core, this agreement is about smarter use of resources: using less of the planet’s precious resources, optimising operations and increasing our internal capability to make the most of data and modern technologies. All of this will help us become a much more agile, efficient organisation that will deliver better services across the region and Strengthen the liveability of our city for many decades to come,” he says.
Microsoft’s forthcoming hyperscale datacenter region will be among the most sustainable ever built, running on 100 per cent renewable energy from day one and using waterless cooling technologies. Using Microsoft’s cloud solutions, AT will easily be able to track emissions across its networks and adjust policies or services to reduce these further.
Vanessa Sorenson, Managing Director of Microsoft New Zealand, said she was excited by the potential for innovation that the agreement would enable.
“One of the things we’re getting lots of enquiries about is latency – the ability to upload and get data in almost real time, which AT’s CCTV networks at stations and intersections rely on. Having a local datacenter region here in Aotearoa means much lower latency than ever, so transport systems can run more smoothly and AT is able to respond faster to security or safety incidents, in partnership with Waka Kotahi and the police,” she said.
It is hard to get excited after looking at Tribune Resources' (ASX:TBR) exact performance, when its stock has declined 19% over the past three months. However, the company's fundamentals look pretty decent, and long-term financials are usually aligned with future market price movements. In this article, we decided to focus on Tribune Resources' ROE.
Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. In other words, it is a profitability ratio which measures the rate of return on the capital provided by the company's shareholders.
See our latest analysis for Tribune Resources
How To Calculate Return On Equity?
The formula for return on equity is:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
So, based on the above formula, the ROE for Tribune Resources is:
13% = AU$38m ÷ AU$297m (Based on the trailing twelve months to December 2021).
The 'return' refers to a company's earnings over the last year. Another way to think of that is that for every A$1 worth of equity, the company was able to earn A$0.13 in profit.
What Has ROE Got To Do With Earnings Growth?
So far, we've learned that ROE is a measure of a company's profitability. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don’t share these attributes.
A Side By Side comparison of Tribune Resources' Earnings Growth And 13% ROE
At first glance, Tribune Resources seems to have a decent ROE. And on comparing with the industry, we found that the the average industry ROE is similar at 16%. Despite the moderate return on equity, Tribune Resources has posted a net income growth of 2.1% over the past five years. A few likely reasons that could be keeping earnings growth low are - the company has a high payout ratio or the business has allocated capital poorly, for instance.
As a next step, we compared Tribune Resources' net income growth with the industry and were disappointed to see that the company's growth is lower than the industry average growth of 26% in the same period.
Earnings growth is a huge factor in stock valuation. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. Doing so will help them establish if the stock's future looks promising or ominous. Is Tribune Resources fairly valued compared to other companies? These 3 valuation measures might help you decide.
Is Tribune Resources Using Its Retained Earnings Effectively?
While Tribune Resources has a decent three-year median payout ratio of 30% (or a retention ratio of 70%), it has seen very little growth in earnings. So there might be other factors at play here which could potentially be hampering growth. For example, the business has faced some headwinds.
In addition, Tribune Resources has been paying dividends over a period of five years suggesting that keeping up dividend payments is way more important to the management even if it comes at the cost of business growth.
Summary
In total, it does look like Tribune Resources has some positive aspects to its business. Yet, the low earnings growth is a bit concerning, especially given that the company has a high rate of return and is reinvesting ma huge portion of its profits. By the looks of it, there could be some other factors, not necessarily in control of the business, that's preventing growth. While we won't completely dismiss the company, what we would do, is try to ascertain how risky the business is to make a more informed decision around the company. Our risks dashboard will have the 1 risk we have identified for Tribune Resources.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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