Daily Archives: June 9, 2007

Microsoft (MSFT): Vista Up?

Microsoft (MSFT) Vista sales between now and the end of the year will be much better than expected, according to Cowen & Co. The research firms says that the investment play for the trend is to buy chip companies including Intel (INTC), Nvidia (NVDA), and Micron (MU).

That approach may be too complex. Microsoft’s shares are flat this year, while share in Intel are up. So is the stock in PC giant Dell (DELL). To some extent, hardware companies are already benefitting from a perceived improvement in the PC environment.

Microsoft’s shares have done worse than the S&P over the last two years.Vista was to take the shares of the company upward. The company’s OS and server products continue to be the only real drivers of operating profit at MSFT. If these segments are about to improve, then the stock price is as well.

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

Posted on: June 9, 2007 – 1:59 pm in Uncategorized

Qualcomm (QCOM) Crisis Deepens, Except For Nokia (NOK

Handset makers like Motorola (MOT) need their Qualcomm (QCOM) chipsets to launch new phones. And cell carriers like AT&T (T) need the new phones to sell 3G services.

By not settling with Broadcom (BRCM) over the issue of whether QCOM has infringed on IP, the company has turned the US cell phone industry on its head. And, that could get worse.

LG, the South Korean handset maker, is petitioning US courts to overturn the ITC’s ban on importing handsets which contain Qualcomm’s next generation chips into the US. The FT quoted one analyst: “The biggest hit will be on LG, which has the biggest exposure to the US CDMA market,” said Richard Windsor, analyst at Nomura.

Motorola’s (MOT) attempt to recover from its handset disaster could also be hurt. The stock is near its 52-week low. The new RAZR2 phone, designed for 3G networks using the Qualcomm chipset. As TheStreet.com points out: "Among the new phones affected if the ban is upheld is the very important Razr 2 phone that is expected to be the flagship of Motorola’s handset resurgence."

But Motorola’s chief rival, world handset leader Nokia (NOK) has no such problems. It is in an IP and licensing struggle of its own with Qualcomm, and as The Associated Press pointed out:  "Nokia Corp., the world’s largest handset maker, would be almost unscathed."

That would appear to leave only two winners, Broadcom, which can negotiate licensing fees from Qualcomm to use its IP, and Nokia, which has little need for the Qualcomm products.

That leaves a lot of losers.

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

Posted on: June 9, 2007 – 10:54 am in Uncategorized

This Week on StockHouse June 4 to June 8

Interest rate fears pulled markets into a downward spiral this week, and affected a broader range of companies than the traditionally interest rate sensitive financial and utilities sectors.

On StockHouse, Sean Mason and Keri Korteling pulled together a list of lists featuring the week’s Top Five (http://www.stockhouse.ca/shfn/article.asp?edtID=19809 ) posters, blogs, BullBoards and more.

Given the uncertainty surrounding the future of interest rates in the U.S. and Canada, it may be a good time to consider gold investments, argued Dave Galland at Casey Research. He said the Fed is between a rock and a hard place (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19798).

One junior gold miner worth a look, noted Institutional Research Partners, is Megastar Development Corp (TSX: V.MDV), in an update (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19803 ) on the Vancouver-based company that was first profiled in March.

Danny Deadlock warned that the weakness (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19799 ) in small- and micro-cap stocks should prompt investors to tread carefully. Taking a page from fellow columnist Steven Saville, he picked up on the idea that the market is revisiting the scene from the late 1960s.

Use your head (and some TA tools) (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19802 ), not your heart to win at the stock market, wrote Don Rodgers in his Trading Discipline column.

Despite proper due diligence, some Netlist (NASDAQ: NLST) investors got burned because the company allegedly failed to address (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19806 ) in pre-IPO filings the fact it faced an oversaturated computer memory market, wrote the Securities Sleuth.

While there are incremental improvements in the treatment of various cancers, this week’s Bio Check noted from the American Society of Clinical Oncologists’ conference that there are no blockbuster drugs (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19807) in the offing.

Market Wizard Mike Paulenoff said that the S&P, which made fresh seven-year highs last week, has reached its peak. Watch the gold market (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19808 ), he urged readers.

Donald Dony echoed the sentiment, and argued the commodities bull is still alive and well. Natural gas stocks (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19808 ), he said, are the best investment for the summer months.

Gold ETFs (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19813 ) and gold equities ETFs could be poised for a fresh run higher, wrote Don Vialoux, who suggested that investors should look for good entry points approaching the period of seasonal strength.

STANDUP Advice columnist John J. DeGoey said that what the world needs now is more plain vanilla certified financial planners (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19816 ).

Want to figure out whether the stock you’re eyeing is overvalued or not? Take a look at the Financially Fit staff’s guide to basic valuation metrics (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19818 ).

Finally, the Totally Technology column looks at how an important U.S. lobby group landed a government promise to send out $40 gift cards (http://www.stockhouse.ca/shfn/editorial.asp?edtID=19817 ) for all who apply. No word on a similar program in Canada, however.

Posted on: June 9, 2007 – 10:31 am in Uncategorized