Daily Archives: January 22, 2008

Ladies Night With Jim Cramer (TJX)

On tonight’s MAD MONEY on CNBC, this was actually a Ladies night where he was in front a live audience full of nothing but… ladies.  He discussed the Fed coming in with the emergency cut and how we would likely have seen a 1,000 point drop today (as we noted a 1,000 point drop was likely without an emergency intervention).  He started out with a Q&A session but he he was giving a retail stock pick that is appropriate in this environment.

Cramer noted retail worked today rather than the defensive stock picks because of retailers being hopefully helped by a rate cut all the way out to the end of this year.  In this environment in a serious economic slowdown his retailer pick that may go up regardless of the Fed is TJX Companies (NYSE: TJX) because of the discount stores T.J.Maxx and Marshall’s brand.  As these stores discount mid to high-end apparel they showed a positive number in same-store-sales for December when most retail sales were weak.  Cramer also likes the CEO as a transformational CEO that will do even better when the economy is doing better.  It has also bought back $650 million in stock and can buy back $250 million more.

If you have ever gone into one of these stores with your intimate other or on your own, you know what a zoo these can be.  Shares closed up almost 3% at $29.71 today in normal trading and shares were up almost 2% more after Cramer touted this one.  TJX has traded as low as $25.49 and as high as $32.46 over the last 52-weeks.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 6:25 pm in Apparel, Cramer, Retail,

Hoku Disconnect: Past Earnings Versus Potential Operations (HOKU)

HOKU Scientific Inc. (NASDAQ: HOKU) reported a Q3 non-GAAP loss of -$0.01 per share, which is better than the First Call consensus of estimate of -$0.10 and revenues rose 15.0% from last year to $1.3 million versus the $1.1 million consensus estimate.  The focus seems to be on the company’s guidance for next quarter with $0.6 to $1.2 million versus $1.35 million consensus.  We frankly aren’t concerned with these small contracts from the last quarter nor over the last year as this company trying to make a major expansion into a true materials supplier.

HOKU said it expects to see some volatility in quarterly earnings as they implement polysilicon strategies.  The company is being treated as though it beat earnings and beat revenues compared to estimates; but the verdict is that the company guided Q4 revenues below consensus estimates.  This may even be partly because of the interpretation that the Associated Press published.  They are entitled to their own opinion and can publish as they see fit, but we’d note here that all of these past revenues are almost entirely irrelevant to the future business model once this Idaho polysilicon plant is up and running (assuming it will). 

There is still a disconnect between the bulls and bears in Hoku based upon what the company will look like soon versus those that are looking at Hoku’s trailing results for inference into its ability to have a bright future. This is why we have given a "both sides of the coin" to show both.

Read More »

Posted on: January 22, 2008 – 6:09 pm in Alternative Energy, Earnings,

Advanced Energy Slapped On Warning (AEIS)

Advanced Energy Industries Inc. (NASDAQ: AEIS) is seeing shares trade sharply lower in after-hours trading after it lowered guidance.  The company now sees revenues of approximately $84 million.  Its previous guidance of $86 million to $90 million.  Advanced Energy also sees GAAP EPS in a range of $0.07 to $0.08, lower than a prior $0.12 to $0.14 range.

  • The blame: continued weakness in the semiconductor market and order delays out of OEM’s.   

The company said it will organize and implement cost reduction plans.  This is after its COO resigned earlier in January less than two-weeks after the company announced a $75 million share buyback plan.

This stock is only a $500 million market cap company so many tech stocks better hope that this doesn’t bleed over into the other core tech markets.  The company makes power and control technologies for plasma thin-film manufacturing processes such as semiconductors, flat panel displays, data storage products, solar cells, and architectural glass.  It also develops grid connect inverters for the solar energy market.  After the correction in many alternative energy names since January 1, traders better hope that this is far from a key supplier to that market.

Shares closed down less than 1% at $11.03 in normal trading, but shares are down 9.3% to $10.00 in after-hours trading.  If these post-close lows hold this will mark a 52-week low as the range was $10.23 to $25.97.  That’s about 60% off its highs and far worse if you consider a $60+ handle for part of 2000 back in the tech bubble days.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 5:13 pm in Earnings Warning, Semiconductor, Technology Companies,

Texas Instruments Delivers (TXN)

Texas Instruments Inc. (NYSE: TXN) has posted earnings of $0.54 EPS and revenues of $3.56 Billion.  TI gave guidance at the start of December with revenues between $3.5 to $3.66 Billion and an EPS range of $0.50 to $0.54. First call had analysts pegged at $0.52 EPS on $3.58 Billion in revenues. 

The company has guided next quarter to $0.43 to $0.49 EPS on revenues of $3.27 to $3.55 Billion.  Next quarter estimates are $0.45 EPS on $3.41 Billion in revenues.

  • TI also used $1.88 billion to repurchase roughly 57 million shares of its common stock as part of its ongoing share buyback plan.

Texas Instruments closed down 1.6% at $28.98 after shares were down 2% at $28.87 late morning for our earnings preview.  The 52-week trading range is actually $28.25 to $39.63.  Shares did actually put in a brief 52-week low today of $28.00 right after the open, so that 52-week trading range will change after today.  In after-hours trading, shares are up 3% from the close to $29.85.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 4:45 pm in Earnings, Semiconductor, Technology Companies,

Apple’s Guidance Looks Light Rather Than Just Conservative (AAPL)

Apple Inc. (NASDAQ: AAPL) has posted EPS at $1.76 on its earnings today with $9.6 Billion revenues; Estimates out of First Call were $1.62 EPS on revenues of $9.47 Billion. 

Next quarter is looking very light after we warned that "conservative numbers" might be taken differently this time compared to Wall Street always giving the company a pass on light guidance.  It sees $0.94 EPS and revenues at around $6.8 Billion, But… estimates are $1.09 EPS on $6.98 Billion in revenues.

  • 22.121 million iPods,under some estimates north of 24 million.
  • roughly 2.315 million iPhones sold.
  • shipped 2.319 million Mac’s.

Apple closed down $5.72 or -3.54% at $155.64 in regular trading and the 52-week trading range is $82.86 to $202.96.  Unfortunately shares are down almost 10% at $140.10 in after-hours trading.  A weak consumer may have a hard time justifying a new lighter laptop that runs some $1,800 before you turn anything extra on it.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 4:39 pm in Consumer Electronics, Earnings, PC Companies, Technology Companies,

52-Week Low Club (AA, BT, CVC, CECO, CSCO, CLWR, CPWR, CSC, COCO, EBAY, ELOY, ENER, ESI, MOT)

These are not at all the only stocks we saw hitting 52-week lows.  These are the main names we follow that closed lower and that challenged their 52-week lows:

  • ALCOA (AA) opened at new 52-week lows but managed to close above the low; down almost 1% today.
  • BT Group (PLC) down almost 8% after U.K. markets were open yesterday and we weren’t.
  • Boeing (BA) opened at new 52-week lows but managed to close above the low; still -1% today.
  • Cablevision (CVC)… I bet Mr. Gabelli wants that old Dolan buyout offer now.
  • Career Education (CECO) down 14% after Sallie Mae terminated its loan program, ouch.
  • Cisco Systems (CSCO) down 3.6% more… so much for enterprise tech spending?
  • Clearwire (CLWR) down almost 8% to $11.48…post-IPO lows.
  • Compuware (CPWR) down 4% to $6.38, after only announcing its earnings date.
  • Computer Science Corp. (CSC) closed barely under the $38.65 prior low at $38.61.
  • Corinthian Colleges (COCO) fell 30% after Sallie Mae terminated its loan program.
  • eBay (EBAY) on Meg Whitman leaving; earnings tomorrow.
  • eLoyalty (ELOY) down 8% to $9.02; prior low $9.48.
  • Energy Conversion Devices (ENER) down 6% and barely managed to close above 52-week lows on a weak alternative energy sector.

….And that is just through the majors starting with "E".

  • ITT Education Serivces (ESI) down 15% after Sallie Mae terminated loan programs.
  • Motorola (MOT) still losing ground despite Icahn’s efforts…. guess who is a huge Sprint Nextel wireless phone supplier?

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 4:16 pm in HI/LOW, , , , , , , , , , , , , ,

AMD (AMD) Loses Ground To Intel (INTC)

More bad news for AMD (AMD). According to new IDC data, Intel’s (INTC) share of the PC market in Q4 07 went to 74.55% a year earlier to 76.68%.

According to MarketWatch "PC chip shipments totaled about 280 million units in 2007, up 12.6% from 2006, according to analyst Shane Rau of IDC. Total revenues rose 1.7% to $30.55 billion in the same period."

In other words, pricing is still awful.

Douglas A. McIntyre

Posted on: January 22, 2008 – 3:58 pm in Semiconductor, ,

Despite “Strategic Alternatives,” Does Anyone Want Getty Images? (GYI, JUPM)

Getty Images Inc. (NYSE: GYI) is one of the few stocks up considerably today, and its business wasn’t likely going to be helped all that much or hurt that much based upon the Fed’s interest rate actions.  After a New York Times report, the stock photo and digital media company did confirm in a press release that it has hired Goldman Sachs as financial advisor to help explore strategic alternatives to enhance shareholder value. 

  • There is just one small problem: it may find that no one is willing to acquire the company even with its valuations trading at what will seem incredibly low. 

We noted for our Special Situation Investing Newsletter subscribers back in May 2007 (See Full Report; now off embargo as position was closed out) when shares were around $50.00 that the company was going to fall victim to what was effectively an industry segment de-merger that the company just couldn’t prevent.  It isn’t that Getty will die entirely.  It does have some key advantages when it comes to sporting event photos other media from other live events and that is where the company’s value and future lies.  But the problem is that even though it has tried to adopt a royalty-free model for certain aspects of its digital imaging business, it cannot just keep acquiring new age digital media companies.  After we noted for clients to take profits on Getty Images we noted that it would be under review for the possibility that ultimately it may want to or need to seek a buyer.  The problem we had is that while it looked like a great value stock, we noted that it may just be another value-trap. It did make some great acquisitions to stave off up-start and more nimble digital competitors, but there is potentially no end in sight for the competition in this space.

If anyone is unsure about the value of having a digital stock photo business, go refer back to our coverage of the post-merger fallout in Jupitermedia (NASDAQ: JUPM) when Getty was supposedly going to buy it.  Opening up a digital stock photo business can be done by anyone.  We have previously noted how we thought the entire business model could be wiki’d and duplicated for $20,000 or less, although an industry contact noted it could be done for a small fraction of that.

Someone may buy Getty in the end.  They just better make sure all the sporting events and live concert and other live event exclusive coverage contracts are locked in place for many many years.  Otherwise they are just buying a business whose model is being wiki’d away chiseled away at every hour.

Getty Images shares are up some 13% today to $24.95 and its 52-week trading range is $21.80 to $57.28.  Reports out yesterday did put the potential sale at $1.5 Billion, and after the rally today its shares have a market cap of $1.49 Billion.  It will post earnings on Thursday, January 31, 2008.

Jon C. Ogg
January 22, 2008

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Posted on: January 22, 2008 – 3:12 pm in Internet, Media, Mergers and Buy Outs, ,

eBay Gets Ready For New Leadership (EBAY, DIS, AMZN)

Shares of online auctioneer eBay (NASDAQ: EBAY) are trading lower today to a new 52-week low on reports that CEO Meg Whitman will be stepping down.  The WSJ led this reporting and it actually took the back seat in order of magnitude because of what was going to be one ugly day had the Fed not intervened. 

Whitman had previously noted that no CEO should stay for more than a decade because of new challenges and changes in an industry.  That appears to be the case now with eBay having matured (we didn’t say peaked) in the U.S.  The company has a dominant auction in the U.S. by far and it has been making its entrances internationally when and where it can garner an edge or acquire a large auction property. 

The acquisition of Skype has been written down further by roughly $1.4 Billion and its "Neighborhoods" foray into social networking hasn’t gotten much press since the press releases and so-so coverage around its launch. It appears that the easy growth days have been seen and the low hangingfruit has been grabbed.  Maybe it is time for a new leader that cangrow the business in an environment that is going to be morechallenging.  Amazon.com (NASDAQ: AMZN) has also made much progress into online retail, although that hasn’t killed the "Buy It Now" aspects of eBay at all; but in theory Amazon could offer an auction platform on certain used goods either via eBay or against eBay now that it is a virtual storefront for anything and everything.

Shares are down more than 30% from 52-week highs over $40.00, and average analyst price targets look to be just under $41.00.  Meg Whitman was once thought to be a candidate for the head job of Disney (NYSE: DIS), although the company has done quite well under its current team.  Whatever she ends up doing, you can bet she isn’t retiring from corporate America entirely. ebay also is reporting earning after the close Wednesday, so if she is truly leaving then you can expect the formal announcement tomorrow.

Shares today are down 3.6% to $27.31, and the 52-week trading range before today’s drop was $27.44 to $40.73.  The intraday lows before the post-Fed recovery are recorded at $26.02.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 2:31 pm in Internet, Management Change, , ,

As Charter (CHTR) Moves To Penny Land, Market Thinks Chapter 11

Charter (CHTR) recently traded as low at $.92 recently and hit $1 early in today’s trading. At a $425 million market cap, the company now trades at .07x revenue.

With nearly $20 billion in debt and a possible drop in consumer spending on telecom and cable services as part of a slowing economy, Wall St. trying to figure out how the company will make its debt service this year.

Paul Allen, who has de facto control of the company, could put in more debt, but that would squeeze existing common shareholders down to zero. That could be legal nightmare for Allen.

Douglas A. McIntyre

Posted on: January 22, 2008 – 12:54 pm in Cable Companies,

Lazard Notes Bare Escentuals As Recession-Resistant (BARE)

Bare Escentuals, Inc. (NASDAQ: BARE) may be one sweet spot that is at least partially immune from the ups and downs of consumer spending.  Today we are getting word out of Lazard Capital Markets that its analyst Jacklyn Rider, its Healthy Lifestyles analyst, is reiterating her Buy rating on Bare Escentuals with a $27.00 target as she feels the growth story is unchanged.  This is fairly new coverage from Lazard Capital Markets as it appears the firm initiated it with a Buy rating earlier this month.

This call is after the company’s management presented at the ICR Xchange conference in California last week to a standing-room only crowd. The company reiterated its long-term growth opportunities to acquire customers, cross-sell products, and expand its points of distribution and international business.

Some of the points noted was a back to basics approach for new products and this note even discusses a recession-resistant product line that "is less sensitive to economic factors and that women will give up other discretionary items before makeup."  Ms. Rider also noted that channel checks indicate that customer demand and enthusiasm for Bare Escentuals’ products have not seen any slowdown.

Lazard is maintaining its earnings estimates of $0.93 for 2007, $1.18 for 2008, and $1.50 for 2009.  The $27 price target is based upon a 18X Lazard’s above consensus 2009 estimate, a discount to two-year earnings growth, and under the low-end of its historical earnings multiple.

The company designs and sells  premium make-up for women with an all-natural and additive-free product line.  We also believe this make-up aspect of the business is at least more recession-resistant than many other businesses (particularly compared to apparel or other discretionary spending), particularly in light of the fact that the company has an all-natural and irritant-free formula.

BARE shares are up 1.8% today at $20.33 right after noon, and the 52-week trading range $19.25 to $43.22 after coming public at higher prices in late-2006.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 12:31 pm in Analyst Calls, Consumer Goods,

Chips Bracing For Texas Instruments Earnings (TXN)

Texas Instruments Inc. (NYSE: TXN) is set to report earnings after today’s close.  It may very well take the back seat compared to the attention that Apple will get, but this will be one of the chip stocks to watch for the sector as a whole.  We’ve already seen Intel & AMD results.  TI gave guidance at the start of December with revenues between $3.5 to $3.66 Billion and an EPS range of $0.50 to $0.54.

Estimates have actually climbed slightly since its December guidance, despite lackluster earnings elsewhere.  First call has analysts pegged at $0.52 EPS on $3.58 Billion in revenues.  Next quarter estimates are $0.45 EPS on $3.41 Billion in revenues.  Options are in the middle of a strike range so it is not exact as to what traders are looking at today.  It appears that options traders are braced for a move of about $1.20 in either direction, but this may be off a bit.

Analysts are mixed on this stock, although the average price target still appears to be north of $38.00.  Perhaps this monster stock repurchase program is still viewed very optimistic by Wall Street.

Texas Instruments shares are trading down 2% at $28.87 late morning, and the 52-week trading range is actually $28.25 to $39.63.  Shares did actually put in a brief 52-week low today of $28.00 right after the open, so that 52-week trading range will change after today.

After TI’s last guidance, shares rose almost 4% to $33.94, so you can see it has also had a tough 5-weeks with shares down almost 17% since then.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 11:37 am in Earnings, Semiconductor, Technology Companies,

Apple’s ‘Conservative Guidance’ May Mean More Than Past Quarters (AAPL)

Apple Inc. (NASDAQ: AAPL) is set to report earnings after the market closes today.  This is actually just the first quarter for its fiscal 2008, but this is also the quarter with the Christmas season and the company may have some insight for what is on the immediate horizon.  Q1 estimates out of First Call are $1.62 EPS on revenues of $9.47 Billion.  Next quarter estimates are $1.09 EPS on $6.98 Billion in revenues.  If Apple offers its fiscal September 2008 guidance, First Call has estimates at $5.14 EPS on $31.8 Billion in revenues.

Shares have recovered handily off of the pre-market and post open lows today, but its shares are still off about 25% of the end of December highs.  While the wild bull run is no longer in a solid up-trend, the 200 day moving average is still around $144.28. Analysts are still positive on the stock with average price targets well north of $200.00 ($214+).  The options are going to be hard to use as a predicting tool because the VIX has risen so much as the market tanked, but it appears that options traders have essentially prepared for a move of up to $15.00 in either direction today.  That is up to nearly a 10% price change based on today’s prices.

What is interesting is how much the market has changed over the last few weeks since Apple became a permanent bull stock.  In the past Steve Jobs has always blown away earnings and then tended to give conservative guidance, and Wall Street assumed the posture of "wink-wink, nod-nod" that this meant the numbers would be far better than that.  But right now the markets are spooked and frankly anything resembling the "efficient market theory" has been thrown out the window.  The investment community will probably be trying to garner how Steve Jobs really sees the environment in a consumer spending environment that has rapidly deteriorated.

We aren’t calling an outright end to the Apple phenomenon because their product cycle is still running, it seems to defy spending concerns, and analysts defend this one on nearly every chance they get.  Macworld is only a week old now and we are only a week or so from the Mac Air notebook hitting the shelves.  But Wall Street wanted something closer to 5 million iPhones sold rather the 4+ million noted last week.  This company has deviated away from being iPod or only Mac-dependent in its numbers now.  We’ve had a new O/S and a new product last week, and now this is becoming more of a series of moving parts rather than a single product or even two product focused company.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 10:59 am in Consumer Electronics, Earnings, PC Companies, Technology Companies,

Motorola (MOT) And Palm (PALM): Night Of The Living Dead

It is all over now for Motorola (MOT) and Palm (PALM). They might have had a chance to pick up enough market shares to dig themselves out of the holes of late products, crummy products, and weak financial performance. RIM (RIMM), Apple (AAPL), Samsung, and Nokia (NOK) have flanked them then overrun them. A bad economy makes their positions untenable.

Word from Wall St. is that sales of the new Motorola (MOT) Razr 2 have been poor. To some extent is is a product that a consumer would buy instead of an iPhone. Motorola is never going to win that war, and other big handset companies are in the market with competing products. If Motorola can manage selling 35 million handsets this quarter it will be a miracle. It would not be hard to believe that the number could fall to 30 million, putting the company’s market share at 12%. It was over 20% not that long ago. Motorola’s shares are down almost 9% today at $12.20. Watch for $10. It could be coming.

Matters are worse for Palm. Elevation Partners put $325 million into Palm in June. Elevation partner Roger McNamee gets write-ups in places like Portfolio Magazine because he is friends with Bono of U2 and his firm owns part of Forbes. He can write off the investment in Palm. All of it.

In a difficult economy even RIM (RIMM) and other handset companies will have trouble selling higher end smartphones. Palm’s shares have been as low as $4.50 today. The have a 52-week high of $19.50. Revenue slipped to $350 million last quarter and the firm had an operating loss of $42 million.

Both business and consumer buyers of handsets can wait a product cycle or two before buying a new product. Even if Palm makes it to market with a better line-up line this year, there may not be many buyers.

No one should be surprised to see Palm shares below $2 before mid-year.

Douglas A. McIntyre

Posted on: January 22, 2008 – 9:52 am in Wireless, , , , ,

The Least Battered DJIA Components (DD, GE, HD, JNJ, WMT)

Below is a list of Dow Jones Industrial Average components that are actually down the least on an ugly day.  There has been news on most of these or if not there was on Friday.  Right after the open all 30 DJIA components are lower and we are down almost 400 points.  These may change quite a bit as the day goes on, but here are the ones down the least so far:

  • DuPont (NYSE: DD) -1.3% at $42.15 after posting earnings that were above plan.
  • General Electric (NYSE: GE) down -1.6% at $33.75 after Friday’s earnings and guidance in-line.
  • Home Depot (NYSE: HD) only -0.6% at $26.10 after a positive note from Bernstein upgrading on valuation.
  • Johnson & Johnson (NYSE: JNJ) down -1.7% at $65.14 after posting in-line earnings.
  • Wal-Mart (NYSE: WMT) -1.2% at $47.03, maybe it really is a defensive name now.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 9:45 am in HI/LOW, Index, , , , ,

Top 10 Pre-Market Analyst Calls (AFL, AXP, ABX, CATM, KSS, LOW, LULU, MDAS, MET, MHS, TNK)

It is going to be hard to get traders to care about mere upgrades and downgrades on a day when the Federal Reserve did an inter-meeting emergency rate cut to stave off a 500+ point drop in the DJIA.  But here are some of the calls from analysts today:

  • AFLAC inc. (AFL) raised to Buy from Neutral at Goldman Sachs.
  • American Express (AXP) downgraded to Hold at Citigroup.
  • Barrick Gold (ABX) upgraded to Outperform at Credit Suisse.
  • Cardtronics (CATM) started as Buy at Banc of America; started as Buy at Deutsche Bank; started as Buy at Piper Jaffray.
  • Kohl’s (KSS) & Lowe’s (LOW) raised to Outperform at Bernstein.
  • lululemon althletica (LULU) downgraded to Underperform at BMO Capital.
  • MedAssets (MDAS) started as Buy at Deutsche Bank; started as Neutral at Piper Jaffray; started as Market Perform at Wachovia.
  • MetLife (MET) downgraded to Neutral from Buy at Goldman Sachs.
  • Medco Health Solutions (MHS) cut to Neutral at UBS.
  • Teekay Tankers (TNK) started as Overweight at JPMorgan; started as Hold at Citigroup.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 8:47 am in Analyst Calls, , , , , , , , , , ,

Bernanke Delivers Emergency Rate Cuts

The Federal Reserve has decided to finally take action to at least catch up to the markets with an inter-meeting emergency rate cut.  The FOMC has announced a 75 basis point rate cut in both the Fed Funds rate and in the Discount Rate.  Fed Funds are now 3.50% and the discount rate is 4%.  Just about two hours ago we wondered if the FOMC would do this to come to the rescue.

"The Committee took this action in view of a weakening of the economic outlook and increasing downside risks to growth.  While strains in short-term funding markets have eased somewhat, broader financial market conditions have continued to deteriorate and credit has tightened further for some businesses and households.  Moreover, incoming information indicates a deepening of the housing contraction as well as some softening in labor markets….. The Committee expects inflation to moderate in coming quarters, but it will be necessary to continue to monitor inflation developments carefully."

The FOMC also noted that appreciable downside risks to growth remain and it will continue to assess the effects of financial and other developments on economic prospects and will act in a timely manner as needed to address those risks.

This is what we were hoping for.  While we would have rather seen this occur during market hours, maybe looking a gift-horse in the mouth isn’t necessary.  We still have the scheduled meeting on January 29 and 30 next week.  This won’t fix all of the problems out there, but it’s a start.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 8:32 am in Economy, ,

Pre-Market Stock News (January 22, 2008)

On a day that DJIA futures are indicating a -500 point drop in the market, it is pretty hard to focus on the individual news out there in each stock.  There are actually a few stocks trading up and here is the individual news:

  • Abraxis BioScience (ABII) received approval from the EU Commission to market ABRAXANE for metastatic breast cancer in Europe.
  • ADTRAN (ADTN) $0.27 EPS vs $0.27 estimates.
  • Bank of America (BAC) posted $0.05 EPS vs. $0.18 estimates, with a $5.28 Billion CDO writedown; shares down over 5% pre-market.
  • BJ Services (BJS) $0.58 EPS vs. $0.59 estimate.
  • Cardiome (CRME) announced that the FDA has not made a decision on its new drug application for KYNAPID for atrial fibrillation; shares appear to be indicated down 10% or so.
  • DuPont (DD) $0.57 EPS vs $0.49 estimates; sees 2008 EPS $3.35 to $3.55 versus $3.43 estimates; shares down almost 2%.
  • eBay (EBAY) WSJ announced Meg Whitman plans to retire, although no formal announcement has been made; shares down 8% pre-market.
  • Exelixis (EXEL) and Bristol-Myers to co-develop XL139; Exelixis will receive a $20 million milestone payment; EXEL down 3% pre-market.
  • Fastenal (FAST) $0.38 EPS vs $0.40 estimates.
  • Google (GOOG) shares down over 5% pre-market.
  • Iomega (IOM) raised guidance; shares up over 10% pre-market.
  • Jacobs Engineering (JEC) $0.75 EPS vs. $0.70 estimates.
  • J&J (JNJ) posted $0.88 EPS vs. $0.86 estimates; sees Fiscal 2008 EPS $4.39-$4.44 vs $4.42 estimates.
  • Microsoft (MSFT) and Citrix Systems (CTXS) announce an expanded alliance to deliver a set of virtualization solutions to address the desktop and server virtualization needs of customers.
  • OSI Systems (OSIS) has received a contract for Rapiscan for about $2 million from its Chinese distributor.
  • Regions Financial (RF) $0.24 EPS vs. $0.29 estimate.
  • Satyam (SAY) $0.32 EPS vs $0.31 estimates; sees next quarter $0.36 EPS vs. $0.34 estimate; sees 2008 EPS $1.27 vs. $1.24 estimate.
  • Tellabs (TLAB) $0.04 EPS vs. $0.01 estimate; Revenues $469.1 million versus $459.6 million estimates; shares down 2.8% pre-market.
  • Teva (TEVA) announced it will acquire privately held CoGenesys for development of peptide- and protein-based medicines for roughly $400 million cash.
  • UnitedHealth (UNH) $0.92 EPS vs. $0.92 estimates; sees 2008 EPS $3.95 to $4.00 vs. $3.96 estimates.
  • Ventana Medical Systems (VMSI) is being acquired by Roche for $89.50 per share in cash in an increased buyout price; shares up 4% at $88.75
  • Wal-MArt (WMT) set to make healthcare announcement this morning.
  • Waters (WAT) $0.98 EPS vs $1.06 estimate.
Posted on: January 22, 2008 – 8:21 am in Pre-Market Activity

Good News From Johnson & Johnson (JNJ)

Johnson & Johnson (JNJ)  announced record sales of $16.0 billion for the fourth quarter of 2007, an increase of 16.6% as compared to the fourth quarter of 2006.

Net earnings and diluted earnings per share for the fourth quarter of 2007 were $2.4 billion and $.82 respectively, representing increases of 9.5% and 10.8% respectively, compared to the same period in 2006

While most shares are off 5% before the open, JNJ is only off 1.5%

Douglas A. McIntyre

Posted on: January 22, 2008 – 7:58 am in Earnings,

Is Iomega Ready For A Comeback? (IOM)

If you have been trading stocks for more than 10-years, you will remember that Iomega (NYSE: IOM) used to be a monster stock for a brief period of time.  That time came and went and it’s been a long quiet road since.  The company makes small portable storage drives that are generally larger than those key-sized flash drives that everyone has.

Interestingly enough, the company actually raised its guidance this morning, and this was from guidance that was just issued back on December 12, 2007.  The company put its Q4 net revenue in a $117 to $121 million range.  It also put net income at $0.09 to $0.11 on a fully diluted basis and non-GAAP earnings at $0.06 to $0.08 EPS.  Previous guidance was $92 million in revenue on non-GAAP EPS on $0.04.

The non-GAAP estimates include a $3.5 million one-time pre-tax benefit related to a prior license of intellectual property and pre-tax expenses of $1.2 million for external professional fees related to the acquisition of ExcelStor Group.

It is hard to imagine that this will be taken as bad news, but this sector is still one that many feel has passed Iomega by and left it in the rear view mirror.  It has made much effort to get into portable media storage and offers large portable drives of 500 GB now for only about $220.00, so it is far removed from being that little Zip Drive company we once knew.  Its balance sheet is also in good shape for a small cap stock.

Iomega share closed at $2.35 Friday, and the 52-week trading range is $2.26 to $5.75.  Its market cap is now only $128.7 million.  We can’t call this one a comeback yet, but you might have some of the old long-term believers at least a little happier today.

Jon C. Ogg
January 22, 2008

Posted on: January 22, 2008 – 7:51 am in Earnings, Technology Companies, ,