By Yaser Anwar, CSC of Equity Investment Ideas
These days I’ve been educating myself about futures thanks to CME’s wicked educational platform for newbies and thought readers might be interested in 3 questions I came across during this educational experience plus some other basic stuff.
Hedge Strategy
CME E-Mini S&P 500 Futures Typical Specs
Hypothetical Example of a Trade
From BioHealth Investor
Shares of Bentley Pharmaceuticals (BNT) are up more than 13% early Friday as the company announced that its U.S. marketing partner, Perrigo Company, has received marketing approval for simvastatin 5 mg, 10 mg, 20 mg, 40 mg and 80 mg tablets.
The FDA also determined that these formulations are equivalent to Merck’s (MRK) Zocor. Simvastatin will be manufactured at Bentley’s Facility in Spain.
The company has already initiated the manufacturing process for fast introduction into the U.S. market.
Shares of Bentley were trading abover $11 at one point during morning trading hours.
The company’s total stock worth is just under $250 million. Bentley holds cash of just over $20 million with a debt of $380 thousand as last reported on Yahoo!Finance.
Annual sales and net profit have been increasing substantially over the last few years.
On November 9 a company director purchased almost $50 thousand worth of stock at $9.85 a share.
From BioHealth Investor
Biotechnology
REPROS THERAPEUTICS [RPRX] +30.18%
INTERMUNE INC [ITMN] +29.03%
EXACT SCIENCES COR [EXAS] +24.59%
LA JOLLA PHARMA [LJPC] +10.32%
IDM PHARMA INC [IDMI] +9.16%
Diagnostic Substances
REMOTEMDX INC [RMDX.OB] +12.95%
IMMUNOMEDICS INC [IMMU] +7.98%
GENE LOGIC INC [GLGC] +4.64%
ASPENBIO PHARMA INC [APNB.OB] +4.44%
MONOGRAM BIOSCIENCES [MGRM] +2.87%
Drug Delivery
BENTLEY PHARMACEUTIC [BNT] +11.38%
EMISPHERE TECH [EMIS] +4.94%
IOMED INC [IOX] +4.26%
ELAN CP PLC ADR [ELN] +4.16%
PENWEST PHARM CO [PPCO] +3.82%
Drug Manufacturers
SCICLONE PHARMA [SCLN] +38.59%
INSPIRE PHARMACEUT [ISPH] +7.04%
ARENA PHARMACEUTIC [ARNA] +6.06%
DEPOMED INC [DEPO] +5.59%
INYX INC [IYXI.OB] +5.56%
Medical Appliances & Equipment
ALPHA INNOTECH [APNO.OB] +33.66%
QMED INC [QMED] +11.14%
RESTORE MEDICAL INC [REST] +6.82%
SYNERGETICS USA INC [SURG] +5.30%
SOMANETICS CORP [SMTS] +3.72%
Medical Instruments & Supplies
IMMUNOCELLULAR THERA [IMUC.OB] +66.67%
LEMAITRE VASCULAR [LMAT] +6.49%
VIVUS INC [VVUS] +5.83%
ENPATH MED INC [NPTH] +5.52%
QUANTRX BIOMEDICAL [QTXB.OB] +5.51%
Medical Laboratories & Research
PREMD INC [PME] +11.28%
MEDASORB TECHNOLOGS [MSBT.OB] +5.00%
PACIFIC BIOMETRICS N [PBME.OB] +2.94%
MEDTOX SCIENTFIC INC [MTOX] +2.86%
ARRAY BIOPHARMA IN [ARRY] +2.24%
Much unpleasantness before the holidays. The Dow was off .63% to 12,343. The Nasdaq was down a similar percentage.
News was light, but work leaked out the Chrysler will unveil another turnaround plan in February. The company has done this often enough so that it requires little practice.
A federal court cut the penalty for the Exxon Valdez oil spill to half of the original $5 billion. Given Exxon’s earnings, it may be a bit of a rounding error.
November consumer spending rose more than it had for any time in four months, leaving a chance that the holidays may be bright.
Toyota put out word that its production in 2007 would be well over 9.4 million vehicles. That will likely put it ahead of GM in the race to be No.1 among the car companies.
Oil stayed above $62 a barrel, but not by much.
Durable goods orders rose 1.9% in November.
The University of Michigan consumer sentiment index rose to 91.7 from 90.6 earlier in December.
Douglas A. McIntyre
Unless an investor owned Hewlett-Packard, the odds are that 2006 was not a good year to be in big chip and hardware stocks. IBM had a fair year, but PC and computer chip companies are glad the year is over.
| Data From AOL Finance |
With all of its Vioxx problems, investors would think that Merck would be unlikely to outperform rivals, especially by a wide margin. But, so far this year, that has happened, with companies like Pfizer and Novantis left well behind.
| Data From AOL Finance. |
Without looking at a chart, many investors would think that old world internet stocks like Amazon and Yahoo! did poorly. Well, they did. But, even Google has underperformed the Nasdaq Composite this year.
| Data from AOL Finance. |
Big oil companies, except BP, have done extremely well this year, even with the price of oil coming down. But, Exxon has handily performed all of its competitors with a rise of 30%. Size counts, at least in the oil business.
|
Data From AOL Finance |
By William Trent, CFA of Stock Market Beat
Ceradyne (CRDN) opened sharply higher this morning when they announced some good news. Ceradyne Gets $133 Million Army Contract – 12/22/2006 4:31:00 AM – Manufacturing.Net – CA6402229
Ceradyne said Firday it received a $133 million delivery order for Enhanced Side Ballistic Inserts (ESBI) from the U.S. Army, Aberdeen Proving Ground, Maryland.
The thing is, the order was part of an already announced contract. For sales to the military companies generally get an umbrella contract for a large quantity over multiple years. However, each year’s portion is subject to Congressional approval. So while it would have been bad news if the company did not receive the follow-on, receiving it was more or less expected.
As trading continues, it appears the market is coming to this conclusion, as half the initial gains have been reversed.
The author may hold a position in the securities discussed. The author’s current holdings are as follows: Long: Union Pacific (UNP) put options; Air Products (APD) put options; Nasdaq 100 (QQQQ) put options; FedEx (FDX) put options; Intuit (INTU) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Three Five Systems (TFS); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Landstar (LSTR) put options; Ceradyne (CRDN) put options; Dell (DELL) put options; Plantronics (PLT) put options
By William Trent, CFA of Stock Market Beat
Readers surprised by our general bearish stance on LCD panel makers generally point out how much demand for the monitors (both as computer monitors and flat panel TV sets) is rising. Indeed, Large-size LCD panel shipments dropped 4% in November, says WitsView
Worldwide large-size LCD panel shipments dropped to 26.3 million units in November, a 4% on-month decrease but 29% on-year increase, said research firm WitsView.
Ignoring the bearishness of the headline, 29% year/year unit growth is rather respectable. But with prices dropping 35% it means sales are lower this year than they were last.
Simple math.
The author may hold a position in the securities discussed. The author’s current holdings are as follows: Long: Union Pacific (UNP) put options; Air Products (APD) put options; Nasdaq 100 (QQQQ) put options; FedEx (FDX) put options; Intuit (INTU) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Three Five Systems (TFS); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Landstar (LSTR) put options; Ceradyne (CRDN) put options; Dell (DELL) put options; Plantronics (PLT) put options
Stocks: (MSFT)(YHOO)(AAPL)(VZ)(TWX)
Website A VC argues that being in the portal business is a losing game. More and more traffic will go to niche sites. Who needs a big site to index everything?
CNN Money wants to differ. It says that the top 10 domains got 40% of all pageviews in 2006, up from 31% in 2001.
The answer to the question the debate frames is probably in having a look at the sites just below the top 10. Most are sites that have been around for a long time. Apple. Verizon. The Weather Channel. Target. CBS. These are not likely to grow faster than the web itself or take traffic from the portals like AOL and MSN.
The largest sites beyond the portals do have some properties that probably steal traffic from the tradtional web destinations. MySpace. YouTube. Photobucket. But, how many of these will emerge in any year and make it into the Top 50 sites. Not many. Perhaps none at all.
The enemy of the big portal is slowing internet traffic growth. As advertising impressions stop growing at a zillion percent year-over-year, the attraction of internet marketing as the "hot medium" starts to go away. Yahoo! has already learned that the hard way.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
JP Morgan downgraded Qualcomm to "underweight" from "neutral". The primary reason was rising litigations costs are cutting operating margins. This may go one for some time.
The move does not reflect rising competition from WiMax and the possible end to its contract with Qualcomm’s largest customer, Nokia.
But, that may already be priced into the stock.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Stocks: (PFE)(RHAT)(GM)(QCOM)
News from everywhere on the day before the Christmas weekend.
The Pfizer board got out of control, giving the departing CEO a pay package of nearly $200 milllion.
Oil dropped to under $63 a barrel. Heating the house at Xmas may be less expensive.
Redhat and Congra, companies in vastly different industries, posted substantially improved earnings.
Qualcomm revised its earnings down for the next quarter.
Toyota set production targets that would move it ahead of GM as the largest car manufacturer in the world.
Holiday travellers were stranded by weather in London and Denver.
Home for the holidays.
Douglas A. McIntyre
Stocks: (BP)(BT)(RTRSY)(VOD)(DB)(DT)(SI)(DCX)(ALU)(FTE)(V)
Markets in Europe were off slightly at 6.45 AM New York time
The FTSE was off a fraction to 6,182. BP was up .4% to 569.5. BT was down .8% to 309.75. Reuters was down 1.4% to 428.25. Vodafone was down 1.4% to 141.75.
The DAXX was down .2% to 6,562. DeutscheBank was down .6% to 46.2 Daimler was down .7% to 28.55. Deutsche Telekom was down .3% to 13.81. Siemens was .1% to 73.62.
The CAC 40 was off .3% to 5,495. Alcatel Lucent was up .6% to 10.92. France Telecom was up .3% to 20.93. Vivendi was down .6% to 29.65.
Data from Reuters
Douglas A. McIntyre
Stocks: (MOT)(QCOM)(BRCM)(NT)(MOT)(ALU)(INTC)(TXN)
The egg heads at the Financial Times of London want readers to believe that the leadership in telecom technology is moving out of the US. With the old Bell Labs,which became, Lucent, merging with French firm Alcatel and Chinese companies building high tech switchs and routers, the US seems to be running behind.
The FT wants to make the case that "the next generation of ideas is coming more from London, Seoul, and Brussels" Nice theory. No evidence.
The revolution in WiMax is being lead by Motorola and Intel. WiMax pioneer Clearwire is US based. Qualcomm has its problems, but it is still the leader in global cell phone chip technology. Its rivals, Texax Instruments and Broadcom are here.
The king of global routing, Cisco, is based in the US. Juniper is still in the US, until someone from overseas buy it. By the same token, a US company like Motorola could buy Canadian telephone tech company Nortel.
Perhaps the FT should send its writers back to school.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
The Wall Street Journal does not like the Chinese Communist party setting up a branch for Wal-Mart employees, especially after putting a union in place for the big retailers "associates" We don’t like it either. As the Journal points out the Chinese position may be: We’re watching you from outside, and inside.
Whether Wal-Mart was consulted in the matter is anyone’s guess.
What is not a guess is that having the government mess in your business in a totalitarian country is never good news. And, Wal-Mart’s growth problems in the US make aggressive expansion into China critical to the company’s future.
No one should be surprised if the Chinese government gets more concerned as Wal-Mart gets larger. It may not be good for local merchants. And, what if the goverment thinks Wal-Mart does not pay its people enough. The party and the union could strike the big retailer and have a good deal of leverage.
The chances of a train wreck at Wal-Mart’s China operation get bigger by the month.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
This column has been critical of ConAgra. Most of its brands are not first-tier market leaders. Its restructuring plans have been in doubt.
But, ConAgra answered the bell. The company has sold off poor performing divisions faster than planned. Cost are down. And, fiscal second quarter earnings rose 44% to $220 million.
The company’s CEO did comment that inflation could put a strain on future results,
The Wall Street Journal says that many analysts are still worried about ConAgra’s future: Credit Suisse’s David C. Nelson told clients this week that while ConAgra "might not hit a wall for some time…we continue to believe that the brands in this portfolio lack strength, and we have not yet seen evidence that CAG can drive topline growth." He rates the stock neutral.
The market liked the results. The stock had been trading below $27. It spiked up to over $28.20 on the news before settling back to $27.40.
The stock now trades near its 52-week high, and up from the low of $18.85.
The company has some believers back, and now it has to keep them.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
(AIRN) Airspan CFO is leaving in 2007 and will be replaced in early 2007.
(APN) Applica’s tender by Nacco was hiked from $6.50 to $7.00.
(AQNT) Acquantive started as Buy/$30 target at Cantor Fitgerald.
(EMC) EMC gets pact from Social Security Admin.
(ESLR) Evergreen Solar get approval from German government over EverQ.
(GOOG) Google started as Buy at Cantor Fitgerald with a $650 target.
(IP) Int’l paper selling off 5 plants to Georgia Pacific for $237M.
(JSDA) Jones Soda ran more than 10% after Cramer touted the stock on MAD MONE&Y as the next HANS last night.
(MI) M&I announced CEO will retire in April 2007.
(MU) Micron traded up 4% after beating earnings at $0.25 EPS vs $0.21e.
(NVLS) Novellus announced Sasson Somek is retiring as President.
(RECN) Resource Connection $0.29 EPS vs $0.27e.
(RHT) Red Hat traded up 12% to $20+ after beating EPS with $0.14 vs $0.12e.
(RIG) Transocean won a $400+M pact over 3-years.
(RIMM) Research-in-Motion $0.95 EPS vs $0.94e; traded up 5% after beating earnings and offeirng guidance.
(RVBD) Riverbed traded up another 3% after Cramer said he doesn’t think it is done nor that it’s too late to get in.
(SHFL) Shuffle Master $0.24 EPS vs $0.19e, but was $0.14 after items; stock rose 6%.
(SLR) Solectron $0.05 EPS vs $0.05e; R$3B vs $2.8B(e).
(THQI) THQ Interactive amended its Xbox 360 license pact with Microsoft.
(TIBX) Tibco Software $0.14 EPS vs $0.13e.
(VCAT) Venture catalyst acquired by IGT for $2.58 per share, a no-premium deal.
Happy Holidays!
Jon C. Ogg
DEC 22, 2006
Stocks: (QCOM)(BRCM)(TXN)(NOK)(S)
Qualcomm’s stock is down, again. The company, which likes to fight with customers like Nokia, and litigate with competitors like Broadcom, said the earnings for the first quarter would be below forecasts. Part of the reason is litigation costs. Another excuse is a delayed order from Pantech in South Korea.
Faced with mounting competition from Texas Instruments and Broadcom, Qualcomm has done little to improve its fortures. Sprint’s decision to move to WiMax and away from Qualcomm’s CDMA chips is another blow to the company.
Qualcomm’s stock trades like a loser. It hit over $52 in May and now trades at just above $38. The reforecast of the quarter is not likely to help.
Qualcomm might reverse its poor fortures it it would get serious about bargaining with Nokia about an extension of the contracts between the two companies. Beating up on your largest customer has a way of hurting the stock price.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Stocks: (F)(TM)(HMC)
The Wall Street Journal ran a cover story about Ford CEO Alan Mulally’s new "war room". The walls are covered with charts and photos, Projects are color coded based on priority. Perhaps he thinks he is Churchill during WWII.
The new CEO plans to cut the company’s number of brands down from eight to some unknown number, and give all the cars the company produces the "Ford feel". Sounds pretty non-specific.No one is buying the "Ford feel" now.
Mulally wrotes to Ford employees: "As demoralizing as a slide down may be, the ride back up is infinitely more exhilarating." Yes, if there is a ride back up.
As one director said to Bill Ford: "We don’t have a second chance. This is it."
The war room may be fine, but until Ford can prove it has models that can compete, especially with Toyota, Nissan, and Honda, in the US market, and improve share from teh 14% low the company thinks it will hit, color coded priorities are just a kid’s game.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
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