Daily Archives: May 4, 2007

Cramer’s Newest Laser Pick

On tonight’s MAD MONEY on CNBC, Jim Cramer said he’s looking at some very speculative names.  His second pick is in lasers.  Last week he speculated on Ionatron (IOTN) and it went up 17% on a contract win this week.  THIS WEEK his laser pick is a cosmetics pick is a new pick called Cynosure, Inc. (CYNO-NASDAQ).  Cramer thinks this is a winner like ELOS or PMTI was.  Since they settled with Palomar they have been free to operate and now they have an antiwrinkle and lipo lasers.  They dont have to pay royalties since this does not do hair removal. 

CYNO closed at $30.97 today, at the top of its $11.38 to $32.99 52-week trading range.  Its market cap was $355 million and does most business overseas.  I took a look at the earnings and this one actually outperforms regularly by a wide margin.  It still has substantial revenue growth as well, or so the analyst estimates are calling for. 

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 5:25 pm in Cramer,

Cramer Digs For Golden Star

On tonight’s MAD MONEY on CNBC, Jim Cramer said he’s looking at some very speculative names.  He’s looking at Golden Star Resources (GSS-NYSE) as the way to play the CNBC challenge as a gold miner that operates in South Africa and South America.  Its flagship mine is in Ghana that is building a new sulfide processing plant.  They have to be able to get the plant up and running for it to be profitable.  He thinks this one can win, and he thinks the plant has a shot at coming online soon.  Once that plant is up and runnin it might even make a good takeover candidate.

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 5:08 pm in Cramer, Metals,

Buffett Takes Berkshire Hathaway Earnings Higher

Berkshire Hathaway just came out and posted some pretty incredible results.  The company posted net earnings of $2.595 Billion, but net earnings from operations and outside of investment gains came in at $2.213 Billion.  This compares to net of $2.313 billion net and $1.787 Billion new from operations in Q1 2006.  On an earnings per share basis for class A shares, the EPS came in at $1,682.00.  There are only two readily available estimates with one being $1,413.00 and another being $1,481.44.  Its total revenues for the first quarter including gains came in at $32.918 Billion.

The company still sits on $39.58 Billion in cash and equivalents and its total assets after fluff are listed at $199.28 Billion.  Total liabilities are $149.424 Billion.  You can read through their entire report from their SEC filing here if you wish.

Shares closed up 0.6% at $109,250.00 today, and the 52-week trading range is $88,000.00 to $114,500.00.  Sudan or no Sudan, if you’re an investor Buffett’s your man.

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 4:34 pm in Conglomerates, Earnings, ,

The 52-Week Low Clubs

Dean Foods (DF) Poor earnings and weak outlook. S&P ratings cut to boot. Drops to $32.83 down from 52-week high of $50.50.

Coeur d’Alene Mines Corporation (CDE) The exploration and mineral properties development company is downgraded by DeutscheBank. Shares fall to $3.74 from 52-week high of $6.46.

Cambrex Corporation (CBM) Issues special dividend of $14, so price does not count.

21St Century Hldg (TCHC) Insurance company has huge fall-off in earnings. Down 45% in one day to $10.78. The 52-week high was $33.75.

Pacer Intl (PACR) Stock in logistics provider drop on poor quarterly report. Hit $24.03 down from 52-week high of $35.36.

Newstar Financial (NWES) Residential mortgage woes. Down to $13.69 from 52-week high of $20.85.

Douglas A. McIntrye

Posted on: May 4, 2007 – 3:15 pm in HI/LOW

Cramer Upping a CROCS Endorsement

Today, Cramer came on CNBC for the STOP TRADING segment and was briefly positive on Olin (OLN-NYSE) as a cheap chemical company and positive on Churchill Downs (CHDN-NASDAQ) ahead of the Kentuckt Derby.

Cramer’s main issue though is on CROCS (CROX-NASDAQ).  He is still sticking with a bullish call on CROCS as one that is now not a fad, and he thinks it is going higher.  He did not go as far as a $95.00 target that was given today but he is now saying "not a fad."  That is markedly different than what he noted in February when he said you could still make money before the fad peaks and it tumbles.  He noted somewhat jokingly that Liz Claiborne (LIZ-NYSE) ought to go buy that company to re-energize its sagging brand.  So that may be a key change in his longer-term views and sounds like he’s going to be behind this one for longer than just "a trade" for his future shows and appearances.

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in any of the companies he covers.

Posted on: May 4, 2007 – 1:55 pm in Apparel, Cramer, Earnings,

Big 5 (BGFV) not feeling so ‘Big’ today

Big 5 Sporting Goods Corporation (BGFV) reported earnings yesterday and here are the highlights:

  • Their first-quarter profit rose 28%
  • Q1 earnings increased to $7.6 million, or 33 cents per share, from $5.9 million, or 26 cents per share during the same period last year
  • Revenue grew 5% to $217 million from $207.2 million
  • Same-store sales rose 1%, again, that’s only 1%

Thomson Financial was looking for Big 5 to post a profit of 32 cents per share on revenue of $218.6 million. Thus the reason why shares of BGFV are down almost 8% today to $24 and change.

On April 17th Credit Suisse said Big 5 potentially faces lower consumer spending due to continued declines in the housing industry and a faltering subprime mortgage market. They downgraded the stock to "Underweight" from "Neutral," noting that "70% of Big 5 stores are in states heavily exposed to subprime problems — particularly California." Kudos to them for pointing out and tossing in the "subprime" reference. I’ve been crying out loud about it for the past month but no one seems to be listening. Still, if you can’t buy a house, your probably not going to stop buying sneakers. Let’s see, $500,000 for this condo or $45 for these Nike’s, I’ll take the Nike’s. I wonder if that analyst’s boss told him to work in "subprime" in his analysis?
" Jim, if you can work in "subprime", I’ll buy you those Nike’s at Big 5"
"You got yourself a deal Tom!"

On Monday (4/30) CIBC World Markets initiated coverage of Big 5 with a "sector outperform" rating and set a target price at $33. There is some hope for Big 5 investors, yesterday they declared a regular quarterly dividend of 9 cents per share. If you buy shares of BGFV before June 1st, you’ll get that 9 cents, so hurry, buy now, supplies may not last and batteries are not included.

Big 5’s guidance for the rest of 2007 fell short of Wall Street’s expectations. They expect earnings this year of between $1.47 per share and $1.57 per share, but added that lower-than-anticipated sales beginning in the second half of April and higher administrative expenses would result in a second-quarter profit of between 25 cents per share and 33 cents per share.

The company has high hopes for the second half of the quarter, which includes Memorial Day, Father’s Day and pre-Fourth of July sales. That’s all fine and dandy, but all I care about it, is for them to improve same-store sales. Big 5 sells some great stuff at low prices, but until the company can get it together, I’ll be buying their running shoes and running from their stock.

Prove me wrong Big 5, improve same-store sales and beat your guidance, otherwise, expect more downgrades to follow. Happy Friday.

Frank Lara Jr.

Frank Lara Jr. can be reached at franklara@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 1:51 pm in Financial Stocks

NYMEX Launching Uranium Futures: What Does It Mean For Uranium Stocks?

Stock Tickers: NMX, USU, CCJ, EMU, MOS, CF, URRE, USEG, URZ

Uranium prices, and many of the underlying stocks that either mine it or explore it or are involved in the processing are way up from prior months.  This sector will get more interesting next week and it has been given very little exposure for something of this magnitude.

The New York Mercantile Exchange (NMX-NYSE) is going to start trading a URANIUM FUTURES CONTRACT on Monday.  You can visit the site and see the summary of details on the contracts that are available.  There were some details that the exchange made public on April 16 and it is worth a read.

It is quite odd that this has not been a US market yet, because as far as most of us know the price is basically set weekly.  What is a bit odd is that the terms are not quite the same as what the industry has used and many of the indications are that the major uranium players themselves are going to sit on the sidelines for a while.  That may or may not hold true in a few months but for now it seems like the speculators and trading firms are going to be the ones involved.

Some of the underlying shares were making major moves a few weeks ago, but some have slown down or stalled during the earnings flood over the last 3 weeks.  Most of these stocks are also either micro-cap companies with loose involvement in the grand scheme of things or they are smaller companies in Canada.  There are still at least some decent sized stocks that can be reviewed in the sector:

USEC (USU-NYSE) is the pure-play that most US investors use as a bogey.

Cameco Corp. (CCJ-NYSE) is far larger as the largest producer in the world and based in Canada.  They are holding a conference call to give an update to the two floods at the Cigar Lake uranium project in Saskatchewan.

Energy Metals (EMU-NYSE) was Jim Cramer’s play on the huge spike in the sector.  Cramer also came out with the two stealth plays in the sector. He also noted Mosaic (MOS-NYSE) and CF Industries (CF-NYSE) as stealth plays in the sector that can enrich uranium from phosphate, but you should know that prices have to be very high and have to be expected to remain very high for those to be cost effective. Here is what he said on these.

We had noted a safety net at the end of 2006 that uranium and nuclear energy investors could look at after Merrill Lynch made some incredibly strong calls for 2007 to 2008.

There were also many of these that were up huge in early April, and here is what was indicated at the time.

Uranium Resources (URRE-NASDAQ) $9.44; April 12 $9.68, DEC 11 $5.96.

U.S. Energy Corp. (USEG-NASDAQ) $6.54; April 12 $5.77; DEC 11 $5.58.

Uranerz Energy Corp (URZ-AMEX) $7.03; April 12 $6.38, DEC 11 $3.83.

There is even a note in the National Post in Canada showing that Raymond James has made some Canadian picks that could be buyouts in the sector.

It is hard to imagine that the contracts will gain a major foothold until the major producers and explorers to come into the actual exchange and participate in the liquidity.  These contracts may offer them some added hedging and liquidity, but it sounds like they are going to wait and see how this goes before they change the time old traditions of current uranium trading. 

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in any of the companies he covers.

Posted on: May 4, 2007 – 11:48 am in Alternative Energy, Nuclear, Utilities, , , , , , , , ,

Starbucks Store Review in Texas

The Starbucks at the busy intersection of Westheimer and Post Oak Boulevard, is perhaps the largest Starbucks in Houston and has to be larger than 99% of all other stores.  This is actually on the outbound traffic if you are using the city map, but it is in a busy enough area that the direction of traffic is close to equal at most times of the day.  I went in at 7:40 AM on Thursday May 3, 2007.  This was not run yesterday ahead of earnings for obvious reasons.

This Starbucks is supposed to be one of the more hip locations located caddy-corner from the Galleria Shopping Center, but they could do a few simple things that would make a major improvement.  We have been using the Peter Lynch method of evaluating products you know and use for investment potentials and Starbucks (SBUX-NASDAQ) iss something many use. 

We have rankings for each category in a 1, 2, or 3 (with 3 being the best).  Here are the 1-3 ratings for the store: Wait -1; Cleanliness – 2; Toilet – 2; Space – 3; Personnel – 1; Inventory – 2; Ambiance – 3.

For this being perhaps a flagship location, the criteria is a little tougher.  The truth is that nothing was horrible, but they need to improve things at the flagship large stores like this. The line was 8 people in front of me and the wait time was a few seconds short of 5 minutes.  The 5-Minute wait is not a total killer, but the employees were just standing around and causing a delay.  In fact, upon leaving the store the line was 12 deep.  For starters every single employee there was “task oriented” and as slow as many postal workers.  There were no smiles, no peppiness, there were yawns, and lots of people looking over what seemed to be a work schedule time chart.  The good news is that no one was rude or sassy, but it was still disappointing.  The merchandise was decent on the sandwiches and cold drinks, but everything was set back too far and too low to easily see.  There were also some empty racks on the baked goods.  The store merchandise was mostly placed fairly well, although once again the newspaper rack was too far away from the counter area; yet there was only 1 copy of the NY Times. 

The space is massive so you aren’t on top of anyone and the seating area is both hip and larger than almost all stores by far.  The John was clean for what the store had to work with, but for a store of this size it needs to be larger and needs to be redone because of the obvious wear and tear.  The ambiance inside is very nice for its hip design with a circular “inner sanctum” theme. All in all it was fairly clean, but there was still the litany of unattended coffees and condiments on many tables and the service area.

Stay tuned for a short synopsis of our entire reviews.  Later today we will be running an actual evaluation of what the company can do from here to improve itself and hopefully make enough of an addition that may add to the bottom line.  Even though we all use their products, we do not own the stock and aren’t being compensated in any manner to hold the company in any light. 

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in any of the companies he covers.

Posted on: May 4, 2007 – 10:42 am in Food, Product Review,

Interactive Brokers Now Public & Open (IBKR)

Stock Tickers: IBKR, ETFC, AMTD, SCHW

Interactive Brokers (IBKR-NASDAQ) has now opened after pricing its IPO.  The IPO came public via the OpenIPO(R) format from W.R.Hambrecht, and we already posted the bidding indications from prior bidding to give some indications of what to potentially expect for first day floors or caps.  Those are far from absolutes, but they could be used as a guide.

-The auction clearing price was $33.00.
-The offering price was $30.01.
-A total of 13,504 bids were received in the auction.
-A total of 8,282 bids were successful.
-A total of 145,514,807 shares, in total, were bid for at prices equal to or in excess of the offering price.
-The pro rata fill rate for bids was 27.5%.

Shares have now traded over 10 million shares and are up above $32.00.  The company has instantly grown in to a size that it can be compared to Ameritrade (AMTD-NASDAQ) and E-Trade (ETFC-NASDAQ), although it is still far short of Charles Schwab (SCHW-NASDAQ).  At the pricing, the company was worth roughly $12 Billion in market cap, but we’ll follow up on that with more precise numbers later.

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 10:02 am in Brokerage Firms, Financial Stocks, IPOs, , , ,

Starbucks Thin Growth

So, Starbuck’s (SBUX) met their number of 19 cents a share that the analyst expected, giving them 18% earning growth. Great? Make it worth paying 27 times earnings? No, let’s look closer.  In Q1 2007 SBUX bought back $50 million worth of stock.  In Q2, that number exploded to $513 million dollars or 17.1 million shares. This represent 2.1% of diluted outstanding shares and was the reason Starbucks met expectations.  After all the negative publicity recently, a miss would have lead to a share sell-off and more stories about the "end of the line" for Starbucks. While I applaud share buybacks as a way to enhance shareholder value, Starbucks cannot continue to spend $500 million a quarter to reach earnings estimates.  They need to grow store traffic

The much heralded international expansion witnessed earnings growth of only 9% and that is disappointing.  When you add margin pressure in both domestic and international operations, you now have additional earnings pressure going forward.  Domestic same store sales growth was a paltry 4% leading me to wonder "when will Mr. James Donald SBUX CEO finally admit McDonald’s coffee offerings are impacting sales?" He never had to address the issue as not a single analyst’s question on the earning call broached the subject.  Consider this: Of the 4% growth, only 1% of that was additional transactions and the other 3% was simply selling those people more items. Even those numbers are skewed as 1.5% of the 3% was price increases over last year.  If we back this out, Starbucks experienced 2.5% actual US store growth on a comparable basis. 

Management consistently maintained that they were coming of a "very tough quarter for comparisons."  Translation? "We did better last year." It also means that new stores are not garnering new Starbucks customers but rather cannibalizing them from other existing stores.  Not good

Today on CNBC Donald said "we do not really consider or discuss our competition".  He’d better start. They are stealing his business. Attracting only 1% more people per quarter will not meet high earnings expectations or justify the nearly twice them PE ratio the shares now enjoy. Shares  of Starbucks are down this year and will not go any.

Todd Sullivan

Posted on: May 4, 2007 – 8:26 am in Earnings

Interactive Brokers IPO Terms Set Even Higher

Interactive Brokers (IBKR-NASDAQ) priced 40 million share IPO at $30.01 per share.  This is now a $1.2 Billion deal and the share count by the end of the bidding was essentially raised twice and with a higher price range.

This is under the OpenIPO® format from W.R.Hambrecht.  HSBC, Fox-Pitt Kelton, Sandler Oneill, and E-Trade were also participating in the deal.  Needless to sday, the demand is there since this is the largest international market trading platform for individuals by giving access to more than 60 different markets between global equity exchanges, futures, options, and currencies.

If you are looking for what a bidding guideline range was, they at least published this:

-The auction clearing price was $33.00.
-The offering price was $30.01.
-A total of 13,504 bids were received in the auction.
-A total of 8,282 bids were successful.
-A total of 145,514,807 shares, in total, were bid for at prices equal to or in excess of the offering price.
-The pro rata fill rate for bids was 27.5%.

Jon C. Ogg
May 4, 2007

Posted on: May 4, 2007 – 7:43 am in Brokerage Firms, Financial Stocks, IPOs,

Berkshire Hathaway Braces For Protesters at Annual Meeting (BRK/A, PTR)

Berkshire Hathaway (BRK/A-NYSE) will have a new issue to deal with at its annual meeting this weekend.  It will have protesters outside calling for Berkshire Hathaway to sell its 1.1% stake in PetroChina (PTR-NYSE), whose parent (China National Petroleum) operates in Sudan.  By operating in Sudan it is tossed in with the pro-genocide camp by “using capitalism as an endorsement.”

The company in the past has defended its stake by noting that there is confusion about its parent’s involvement in Sudan.  Some groups believe that PertoChina has been in support of the government there.  Other pensions have sold stakes in an anti-Sudanese support movement.

The company made a statement back in February due to the controversial coverage and you can read that here at their website.  Warren Buffett is a hard man to criticize based on his last Billions of dollar giveaway announcement, but you have to wonder if they will decide to throw in the towel here for greener or less controversial pastures.

Jon C. Ogg
May 4, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 4, 2007 – 7:28 am in Conglomerates, ,

Pre-Market Analyst Calls (May 4, 2007)

BIIB cut to Sector Perform at RBC.
BLT cut to Neutral at Baird.
BLKB raised to Hold at Citigroup.
BONT started as Buy at B of A.
CBL cut to Hold at AGEdwards.
CECO raised to Neutral at Sun Trust Robinson Humphrey.
CYN started as Hold at AGEdwards.
DRI raised to Buy at KeyBanc/McDonald.
EDO raised to Outperform at Credit Suisse.
EL raised to Outperform at Credit Suisse.
FNSR cut to Neutral at Merriman Curhan Ford.
GFI cut to Neutral at HSBC.
GRP cut to Neutral at UBS.
JBHT cut to Mkt Perform at Wachovia.
KNOL cut to Hold at Jefferies.
MWV cut to Underweight at Prudential.
NRP cut to Hold at Citigroup.
NVO cut to Peer Perform at Bear Stearns.
PRSC raised to Buy at Jefferies.
QLGC cut to Mkt Perform at FBR.
RNWK raised to Mkt Perform at JMP.
REG raised to Buy at Deutsche Bank.
RDS.A raised to Peer Perform at Bear Stearns.
ROK raised to Overweight at JPMorgan.
SGP raised to overweight at Prudential.
TRCA cut to Neutral at Baird.
UL raised to Buy at Citigroup.
UEIC raised to Outperform at RBC.
VCI cut to Hold at Deutsche Bank.

Jon C. Ogg
May 4, 2007

Posted on: May 4, 2007 – 6:58 am in Analyst Calls

Reuters Suitors: Dow Jones, Thomson, News Corp?

Rumors that Reuters (RTRSY) has been approached about selling the company now revolve around Canandian information services giant Thomson (TOC). The company has a market cap of almost $30 billion, and it is unlikely that Reuters would go for less than $15 billion. But, part of the core of Thomson’s operations is financial services information.

The other rumored candidate is News Corp.(NWS) With a "we will take no action" reaction from the families that control Dow Jones (DJ), Murdoch may have decided to go after a larger company and compete with Dow Jones rather than buy it Reuters could be  good partner in the start-up of the News Corp TV business channel. News Corp’s market cap is close to $70 billion. But, Reuters can block any buyer who takes a position in the company over 30% in the name of keeping its news organization independent. A trust controls a portion of Reuters’ shares.

Of course, the other potential buyer might be Dow Jones. It is only worth a little under $5 billion in the open market, but in this period of private equity, the idea that a firm like Blackstone or KKR could put together a deal is certainly within the realm of possibility. It would keep both firms out of the hands of Murdoch.

Douglas  A. McIntyre

Posted on: May 4, 2007 – 6:40 am in Mergers and Buy Outs

Would Google Buy Yahoo!

At first glance, the purchase of Yahoo! (YHOO) by Google (GOOG) would seem to be nonsense. Think about the antitrust problems. But, think about them again. The two major competitors that a combined company would face are Time Warner (TWX) with its AOL division and Microsoft (MSFT) which owns MSN and Microsoft Live. According to comScore, Micorosoft sites had more unique visitors worldwide than Google’s or Yahoo!’s and Time Warner’s sites are fourth.

The worst thing that can happen to Google is for Microsoft and Yahoo! to get together. Google’s lead in search is so clear now, that the only threat would be for Microsoft and Yahoo! to combine their shares, which would give them about 39% of the market to Google’s 48%.

Google could certainly afford Yahoo!. It has a market cap of $146 billion to Yahoo’s $38 billion.

And, Yahoo! might rather be a part of Google. Microsoft’s culture might be a big hard to take. Being part of an operating system company may attractive.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: May 4, 2007 – 6:02 am in Mergers and Buy Outs

WiMax Nation: Sprint, Intel And Motorola May Be Right

Intel (INTC) management is forecasting that WiMax will reach 150 million potential customers by 2008. By 2010, that number will hit 650 billion with 1.3 billion being the figure by 2012. Just five short years.

There are already 400 commercial deployments of WiMax around the world.

If the numbers are even close to reality, the investment that Intel has made in developing chips for the technology and investing in WiMax firm Clearwire (CLWR) may pay off big. Ditto Motorola (MOT) which is making infrastructure investment for supplying equipment for deployments.

But, the biggest winner may be Sprint (S), which is betting almost its entire future on building a US WiMax network that will reach 100 million potential customers by the end of 2008. Sprint is using the technology in the place of more conventional 3G such is supported by firms lead by Qualcomm (QCOM).

With Sprint losing ground to Verizon Wireless (VZ) and AT&T (T) Wireless, it needs something to get back into the game. If WiMax is about to become a large global success, having the largest footprint in the US would be a big plus for the cell service firm.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: May 4, 2007 – 5:49 am in Uncategorized

Now That Intel Has Dispatched AMD, Who Can It Compete With?

Intel (INTC) is once again king of the chip world. The company CEO claims that profits will rise faster than revenue for the next two years because of better products and lower costs. He also says that the company has taken back 2% to 6% of the market share it lost to smaller rival AMD (AMD). And AMD is in trouble. It recently raised money to help offset its dwindling cash position.

So, what worlds can Intel conquer now. According to the company, "it will develop semiconductors for new varieties of hand-held gadgets, consumer-electronics products and portable computers for emerging economies."  This would include pocket PCs that have broadband connections and could compete with high-end cell phone handsets. It may even move to supplying smart phones.

But, if Intel thought it would walk away from its triumph over AMD and move into these other markets to expand revenue, it may find formidable competition in the way, including Texas Instruments (TXN) and Qualcomm (QCOM). Both companies are expanding their chip offerings into 3G wireless broadband devices, and both have financial and technical resource beyond those available to AMD.

It is worth remembering that TI had operating income of $3.3 billion last year to Intel’s $5.7 billion. Qualcomm’s hit $2.7 billion.

The world of smaller gadgets, pocket communications devices, and consumer electronics gear belongs much more to the likes of TI, Qualcomm, and other firms like Samsung.

Intel may like the idea of expansion, but it will not be able to walk-over its new competition.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: May 4, 2007 – 5:31 am in Semiconductor

Starbucks Joins Google And Apple As Stocks That Can’t Move Up

Over the last month, the S&P is up about 8%. Apple (AAPL) is up 6% and Google (GOOG) is flat. Even with a jump of 1% to 2% after hours, Starbucks (SBUX) shares may be up 3% for the 30 day period. They are still well below their 52-week high.

What happened? Spectacular expectations. Google’s revenue rose well over 70%. Apple not only had EPS of $.87 compared to some Wall St. estimates of $.67. It is also beginning to show strong growth of its Mac computers and is now taking share from PCs.

Starbucks revenue rose 20% in the quarter just reported. The company guided to growth remaining at this rate though-out the year. Starbucks opened 560 stores in the quarter to hit 13,728.

But, Starbucks has also said that it will have 40,000 stores eventually. Just as the market expects the Apple iPhone to be a huge success, and Google to keep its 50% share of the search market.

In short, there is almost nothing that these companies can do to impress Wall St. enough to get a big rise out of their share prices. That makes it tough on current holders.

Over the last five years, Apple’s shares are up about 700%, followed by Google’s at nearly 400% and Starbucks at 200%. But, year-to-date, only Apple has outperformed the S&P and not by much. Even Ebay is up by about the same amount.

Shareholders in the three stocks could be facing a period where forecasts and price targets for the company’s are so high that they can do nothing to move their share prices other than disappoint.

And, that is hard to swallow.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: May 4, 2007 – 5:11 am in Earnings

Starbucks Joins Google And Apple As Stocks That Can’t Move Up

Over the last month, the S&P is up about 8%. Apple (AAPL) is up 6% and Google (GOOG) is flat. Even with a jump of 1% to 2% after hours, Starbucks (SBUX) shares may be up 3% for the 30 day period. They are still well below their 52-week high.

What happened? Spectacular expectations. Google’s revenue rose well over 70%. Apple not only had EPS of $.87 compared to some Wall St. estimates of $.67. It is also beginning to show strong growth of its Mac computers and is now taking share from PCs.

Starbucks revenue rose 20% in the quarter just reported. The company guided to growth remaining at this rate though-out the year. Starbucks opened 560 stores in the quarter to hit 13,728.

But, Starbucks has also said that it will have 40,000 stores eventually. Just as the market expects the Apple iPhone to be a huge success, and Google to keep its 50% share of the search market.

In short, there is almost nothing that these companies can do to impress Wall St. enough to get a big rise out of their share prices. That makes it tough on current holders.

Over the last five years, Apple’s shares are up about 700%, followed by Google’s at nearly 400% and Starbucks at 200%. But, year-to-date, only Apple has outperformed the S&P and not by much. Even Ebay is up by about the same amount.

Shareholders in the three stocks could be facing a period where forecasts and price targets for the company’s are so high that they can do nothing to move their share prices other than disappoint.

And, that is hard to swallow.

Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.

Posted on: May 4, 2007 – 5:10 am in Earnings

Microsoft Moves To Buy Yahoo!

According to the New York Post, Microsoft (MSFT) has asked Yahoo! (YHOO) to enter formal discussions about a buy-out that would be worth $50 billion to Yahoo! shareholders. The web portal currently has a market cap of about $38 billion.

Microsoft’s own online initiative has fallen apart. The company’s MSN and search business are not competitive with Yahoo! or Google (GOOG) in terms of revenue. Microsofts share of the US search market is little more than 10%, but Yahoo!’s is closer to 30%. Together, with a total share of 40%, they would be in a position to challenge Google.

Yahoo!’ flagging fortures and loss of share to Google have taken its shares down enough so that the deal may actually happen.

Douglas A. McIntyre

Posted on: May 4, 2007 – 4:13 am in Mergers and Buy Outs