Daily Archives: February 12, 2008

Will Coke Match Pepsi’s Earnings Fizz? (KO, PEP)

On Wednesday morning, we’ll get to see earnings out of Coca-Cola Co. (NYSE: KO). The estimates from First Call for the world’s leading beverage giant are $0.55 EPS on $7.01 Billion in revenues.  Next quarter estimates are $0.62 EPS on $6.66 Billion in revenues and estimates for fiscal Dec-2008 are $3.00 EPS on $31.1 Billion in revenues.

Analysts have an average price target north of $66.00.  We recently chose Pepsico (NYSE: PEP) in an earnings and valuation measurement for our go-to defensive stock picks for the first part of 2008, and that was long before Pepsi did incredibly well off of earnings.  Jim Cramer gave some dueling targets on Coke VS. Pepsi.

Today’s options prices were signaling an expected price move of up to $1.20 in either direction.  As far as the stock chart goes, KO is no longer in its long-term uptrend.  It is looking more like it is in a no-man’s land with the 50-day moving average at $61.59 and the 200-day moving average at $56.50.  Coca Cola’s 52-week trading range is $45.56 to $65.59.

Last week, Pepsi saw shares rise over $3.00 on earnings and shares are even higher yet.  Over the last 5-days, Pepsico shares are up over 6% while Coca Cola shares are up just under 4%.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 6:25 pm in Earnings, Food, ,

Blue Nile, Red Slaughterhouse (NILE)

Blue Nile Inc. (NASDAQ: NILE) is seeing a total smack-down in after-hours trading.  The Seattle-based online jewelry retailer said Q4 net income rose considerably to $7.54 million which translates to $0.45 EPS.  This is up from $5.75 million, or $0.35 in Q4-2006, and analysts at First Call had consensus at $0.44 EPS.  NILE’s sales increased 23% to $111.9 million from $90.7 million, and First Call has estimates at $113.15 million.

While earnings were acceptable, the guidance is horrible.  For the first quarter of 2008, Blue Nile expects $0.11 to $0.14 EPS on relatively flat net sales compared to the Q1-2007 sales of $67.91 million.  Those won’t cut it, and even though we have been critical about traders not pricing in any slowdown this is just painful.  First Call has estimates at $0.23 EPS on $82.2 million.  Ouch!

Blue Nile also made a key change that analysts and traders don’t like, particularly as the economy is softening.  It named President Diane Irvine to the additional role of CEO to replace Mark Vadon, who was named executive chairman.

  • One value manager recently noted the chances for much higher prices at THE VALUE INVESTING CONGRESS, although that is looking farther and farther from reality as of today.

This one is uglier than a leathery neck in after-hours trading. Shares closed down 2.5% today at $53.85 in regular trading and shares are down 21% to $42.43 in after-hours trading.  The 52-week trading range is $37.85 to $106.16.

Blue Nile authorized an additional $100 million to repurchase shares of its common stock over the next 24 months and that takes the total approved buyback plan up to $150 million.  That may help stabilize the stock ahead when it chooses to buy stock on weakness, but it’s doing nothing today as investors don’t really think of web retailers as being big buyers of their own shares. 

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 5:26 pm in Earnings, Internet, ,

The 52-Week Low Club (VRTX)(NT)(DY)

Dycom Industries (DY) Company lowers forecast. Falls to $15 from 52-week high of $34.13.

Nortel Networks (NT) Sel-off at the end of the day. No news. Falls to $10.28 from 2-week high of $31.79.

Tapestry Pharmaceuticals (TPPH) Company cuts 65% of work-force move toward Chapter 11. Falls to $.04 from 52-week high of $2.07.

Nxstage Medical (NXTM) Bigger than expected quarterly loss. Sells off to $8.01 from 52-week high of $15.61.

Neurometrix (NURO) Company has loss in quarter. Falls to $4.04 from 52-week high of $12.10.

Vertex Pharmaceuticals (VRTX) Costs running higher than expected. Drops to $16.04 from 52-week high of $41.42.

Douglas A. McIntyre

Posted on: February 12, 2008 – 4:56 pm in HI/LOW, , , , , ,

Website Pros Remains Top Developing Web Property

Website Pros (NASDAQ: WSPI) just posted what are actually very strong earnings when you consider the current climate right now.  The hosting, e-commerce, domain registrar (and more) posted earnings of $0.13 non-GAAP EPS on $31.3 million before exclusionary acquisition items and $30.9 million after.  First Call had estimates at $0.11 EPS on $31.26 million in in revenues.

The company put guidance for 2008 non-GAAP EPS at $0.78 to $0.82, above the $0.77 consensus estimate.  It also puts 2008 revenues at $133 to $137 million, while consensus estimates are $134.4 million.

The company’s customer metrics looked better quarter over quarter as well, with its churn rate down to 4% from 4.1% and its total subscribers were 263,000 from 255,000.  It also noted how its acquisition of Web.com will boost non-GAAP EPS during the first half of 2008.

We have featured this one positively for the last two weeks in "UNDER $10 STOCKS" subscriber letter.  Frankly, we do see some areas where the bulls can make their cheers and also where some of the nay-sayers could point to issues.  But all in all, this was a solid quarter and this remains one of our top small cap internet stocks with upside from current levels.

Shares closed up 2.4% at $9.88 today, and shares are up almost 4% at $10.26 in after-hours trading.  Its 52-week trading range is $7.92 to $12.00.  This one is thinly covered and has an average analyst target of roughly $14.00, although our fair value is a bit under those targets.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 4:55 pm in Earnings, Internet, , , ,

Value & GARP in Buffalo Wild Wings Earnings (BWLD)

Buffalo Wild Wings, Inc. (NASDAQ: BWLD) is not really feeling the pinch of a recession.  The company posted EPS at $0.34 on a 9.7% rise in revenues to $91.4 million.  First Call had estimates at $0.36 EPS on $91.8 million in revenues.  Same-store sales rose 3.4% at company-owned stores and 2.3% at franchised stores.

Its fiscal 2007 EPS came in at $1.10 on net income of $19.654 million.  The company offered guidance for 2008 at 15% unit growth in 2008 and net income growth of 25% for 2008.

Its 52-week trading range is $18.25 to $47.75, and shares closed down 2.2% today at $23.40.  Shares were up 14% at $26.80 in after-hours trading.

With a current P/E ratio of 21 and anticipated growth of 15% in units and 25% in net income, it will be hard to criticize this chicken spot too much.  That might even be more of the case after the company sold off 50% from its highs.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 4:31 pm in Earnings, Food,

Applied Materials Beats Lowered Estimates; No Guidance (AMAT)

Applied Materials Inc. (NASDAQ: AMAT) has just posted earnings of $0.25 EPS non-GAAP (GAAP $0.19 EPS) on $2.09 Billion in revenues; First Call had estimates pegged at $0.20 non-GAAP EPS on $2.01 Billion revenues.  While that number is 4% above its estimates on revenues, that is down about 8% year over year.

Margins were slightly above estimates but also eroded for the first quarter of fiscal 2008 to 44.8%, down from 46.7% for the first quarter of fiscal 2007.  New orders were listed as $2.5 Billion.  Applied already announced 1,000 layoffs and a reorganization in January, So this was just catching up to the news.  Unfortunately, the company didn’t give guidance so this is an incomplete story until that is out.

Applied closed down almost 2% at $18.07 and it is trading up almost 3% at $18.55 in after-hours trading.

Jon C. Ogg
February 12, 2008

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Posted on: February 12, 2008 – 4:13 pm in Earnings, Semiconductor,

Best Recent IPO: Titan Machinery (TITN)

If you have been following our IPO index over the last few weeks you have probably noticed that many IPO’s are being withdrawn "due to market conditions" or that SPAC IPO’s are coming out more than ever.  But there are actually some bright spots out there in IPO’s.  Titan Machinery, Inc. (NASDAQ: TITN) is a post-IPO stock that has been on fire.

Titan owns and operates a network of full service agricultural and construction equipment stores, it might not come as that much of a surprise.  Three years ago or more no one cared about any of these agriculture plays, but now with ethanol, China, India, Africa, Latin America, biodiesel, switchgrass, a hearty appetite to stuff our bellies, commodity traders, and every other issue chewing up everything we can grow, this is one of the hottest sectors in an otherwise crummy market.  It’s almost as though every farmer in Africa, Asia, and Latin America can suddenly buy up the world’s food supply and spend unlimited amounts on machinery and ag services.

This one came public in early December so it’s only about 60-days old.  Craig Hallum and Robert W. Baird were the only underwriters, so it is likely that this won’t get the largest or strongest analyst following.  But traders don’t mind, and in fact you might think they prefer it.  Baird started this with an Outperform rating in mid-January at the peak of the market sell-offs when everyone was negative daily.  But out of the end of 2007 IPO’s, this one appears to be the leader in percentage gains.  This priced at $8.50, and has traded in a range of $11.50 to $18.50.  Today shares are up almost 4% at $16.85.

As of last look this had only 205,272 shares in the short interest, which is close to 1.0 days to cover.  The market cap as of last look is $225 million.  Traders who love agriculture obviously love this one.  Investors who got shares at the IPO are up nearly 100%, and any investor who bought on the heels of its IPO are up close to 50%.  Not bad for this market.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 3:00 pm in Agriculture, IPOs, ,

SunTrust: A Bank Raising Its Dividend! (STI)

Most banks have been having to be quiet as a church mouse not let their CDO and mortgage operation murder their books all at once.  many banks and financials have had to lower their dividends.  Some are failing and some are destined to fail

Companies that RAISE their dividends are deemed as "confident in their future and their ability to post consistent earnings."  Enter the news from SunTrust Banks. Inc. (NYSE: STI).  Today it hiked its dividend by 5% and its previous $2.92 annualized dividend is now going to be a higher level at $3.08 EPS.  This will now carry a 4.7% dividend yield, not a crummy one at all.  That is better than most of our Dogs of the Dow dividends.

SunTrust noted that this "reflects the strength of SunTrust’s underlying financial resources" and "confidence in the Company’s ability to successfully manage through the current environment."

What a stark difference this is to others.  We recently gave a full list of companies we thought may CUT the dividend.  We have noted this as one of the potential candidates in financial mergers, and this might as well be a reason we tied this one to Warren Buffett before.

SunTrust shares are at $64.80 +/- on last look.  Its 52-week trading range is $54.30 to $94.18.  Analysts have an average target of $64.00 or higher.  This might even trigger some upgrades from a negative analyst community that is desperate to find an oasis in a miserably hot desert.

 

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 2:03 pm in Banking, Dividend, ,

Why Apple (AAPL) Won’t Recover

There is too much bad news in the pipeline and no good news likely to appear over the next three months for Apple (NASDAQ: AAPL) to recover much from its current level of $128.

The "unlock" rate for the iPhone has scared off a number of Wall St. investors. That percent is put at 20% by Citigroup and Apple gets nothing on the back-end from a carrier on any of those handsets.

Friedman Billings recently reported that its channel checks showed that the number of iPhones and iPods being built is slowing. Mac units are increasing, but not enough to offset a significant drop-off in the growth of the other two devices.

In terms of competition, both Nokia (NYSE: NOK) and Sony Ericsson have said that they will push their smartphone sales in the US harder because each of them has modest market share. With RIM (NASDAQ: RIMM) and Apple holding the high ground in this segment of handsets that mean that the overseas vendors will have to take aim at the iPhone and Blackberry if they hope to pick-up sales.

Apple may have one piece of news which could pop the stock. A 3G versions of the iPhone has been anticipated for some time. Sales are not being helped by having the device running on a 2.5G network. But, that is not much news to offset a series of perceived weaknesses.

Douglas A. McIntyre

Posted on: February 12, 2008 – 1:07 pm in Consumer Electronics, , ,

Boutique Calling For Sirius-XM Approval (SIRI, XMSR)

There is an interesting note out of Stanford Group Company’s Paul Gallant calling for the likely approval of the merger between Sirius Satellite Radio (NASDAQ: SIRI) and XM Satellite Radio (NASDAQ: XMSR).  The research note states specifically "We believe the Department of Justice (DOJ) is near a ruling on the XM-Sirius merger, and we reiterate our belief that it is likely to win regulatory approval. "

It also noted a last ditch effort of an opposition group meeting with the DOJ and notes this is usually parties who are likely to lose the battle.  "As for timing, DOJ’s ruling could come any day now. Shortly after DOJ rules, we expect FCC Chairman Martin to recommend to his fellow commissioners the same outcome reached by DOJ. "

While this is a belief in support of the merger, Stanford does not conditions will still likely exist:

  • requiring Sirius/XM to include HD tuners in each unit sold;
  • restricting local advertising or local content;
  • imposing terms for various pricing/a la carte commitments.

This merger has persisted almost exactly a year and has been one of the more fought over mergers from alleged consumer groups, although the defiant RIAA is opposing this more from a self interest than from a consumer protectionist group.  As always, follow the money and you don’t ever have to go too far.

Sirius shares are up 1.1% at $3.175, although shares were up as high as $3.25 today.  XM shares are up roughly 2.2% to $13.00, although it has traded as high as $13.35 today.

Please keep in mind that speculation on this has gone on and on: 

Both stocks were higher earlier in the day.  It is the belief of 247WallSt.com that no such concerns over competition are merited.  We also believe that this merger must go through for at least one of these satellite radio providers to survive, and that was our feeling before Joe Q. Consumer decided to start slashing and burning routine $8 to $100 regular monthly expenses where possible.  On last look there was a greater than 12% merger-arb spread on this merger, so it is still far from a done deal according to Wall Street and actual trading capital.

If this merger is actually and finally close, stay tuned.  There are going to likely be some large stock price changes either way.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 1:06 pm in Analyst Calls, Media, Mergers and Buy Outs, Satellite, , , , ,

Julius Baer’s Artio Files For IPO (ART)

Julius Baer Americas Inc. has filed for its Artio Global Investors, Inc. to come public in an initial public offering. It has filed for registration purposes a sale of up to $1 Billion in securities, although this number is for filing purposes and may likely change.  Artio will take the proposed ticker "ART" on NYSE.  So far Goldman Sachs and Merrill Lynch are the only listed underwriters, although that may change by the IPO date.

Artio is an asset manager for institutional and mutual fund clients that is best known for International Equity strategies, which was roughly 92% of assets under management as of September 30, 2007.  It also offers other investment strategies in Global High Grade Fixed Income, Global High Yield and Global Equity. All strategies had outperformed their benchmarks since inception and all of its mutual fund share classes that are rated by Morningstar carried either a 4-star or 5-star rating.  Both stats are according to the filing.  It has increased assets under management from $2.9 billion as of 2002 to $73.2 billion as of September 30, 2007.

After the offering there will be three classes of common stock, and it appears that parent Julius Baer will still hold shares.  We’ll follow up later if there are any changes to that.  For the nine-months ended September 30, 2007, its asset management revenues were listed as $321.3 million, and total revenues were were $334.1 million.  For the same period in 2006, those same revenues were $214.9 million and $223.9 million respectively.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 12:23 pm in Financial Stocks, IPOs, , ,

Sun Micro Wants Deeper Virtualization (JAVA, CTXS, VMW)

Sun Microsystems, Inc. (NASDAQ:JAVA) has announced that it has entered into a stock purchase agreement to acquire Stuttgart, Germany-based innotek.  Sun is calling innotek the provider of the leading edge, open source virtualization software called "VirtualBox."  VirtualBox has had over 4 million downloads since January 2007.

As part of Sun Micro’s xVM portfolio, VirtualBox will have the support of Sun’s global development community, field resources and partners to make VirtualBox even more compelling to developers and end users, driving greater adoption across a broad set of communities.  This will also enable desktops or laptops to run Windows, Mac, Linus, or Solaris O/S side by side.

This is after Sun announced it would acquire MySQL last month.  Financial terms were not disclosed, although this is listed as "not material" to earnings.

Citrix Systems (NASDAQ: CTXS) saw a brief rally after it acquired XenSource for virtualization and we all know how the hotter-than-hot VMware (NYSE: VMW) IPO brought virtualization front and center in the investment community.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 11:19 am in Mergers and Buy Outs, Software, , , , , , , , , , ,

Claymore Launches Fixed Income ETF’s (UEM, UBD, ULQ)

Claymore Securities Inc., has just launched three broad market exchange traded funds that are designed to track the value of the U.S. capital markets (bonds). The Claymore Capital Markets ETFs have launched on the American Stock Exchange and include the following:

  • Claymore U.S.-1–The Capital Markets Index ETF (AMEX: UEM); The Capital Markets Index (the "CPMKTS Index") includes equity, fixed income and money market securities and is designed to be a long term measure of the three segments of the U.S. investment grade capital markets.
  • Claymore U.S. Capital Markets Bond ETF (AMEX: UBD); The Capital Markets Bond Index (the "CPMKTB Index") is designed to be a long-term measure of the performance of the U.S. investment grade bond markets.
  • Claymore U.S. Micro-Term Fixed Income ETF (AMEX: ULQ); The Capital Markets Liquidity Index (the "CPMKTL Index") represents the U.S. money markets and in the micro-term fixed income capital markets, but the Fund is not a money market fund and thus does not seek to maintain a stable net asset value of $1.00 per share.

ETF launches have been muted so far this year.  It is not just that the market has been volatile and adverse to new issuances.  The merger between the NYSE & AMEX has likely created some confusion over listings and future fees for being listed.  Hopefully this won’t be the last group of new ETF’s we see, even if these might be a bit thinner in trading volume than some of the other fixed income ETF’s.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 9:52 am in ETF, , , ,

AIG Says, “Oops, We Didn’t Mean It” (AIG)

American International Group (NYSE: AIG) saw one ugly Monday with a draw down to a new 52-week low after it disclosed an auditor’s "material Weakness" and new round of decreased values to some $5 Billion.  Apparently the officers saw the stock reaction yesterday and decided they should declare a "DO-OVER!" like kids playing a game.

Here is the statement from the company:

  • "AIG continues to believe that the mark-to-market unrealized losses on the super senior credit default swap portfolio of AIG Financial Products Corp. (AIGFP) are not indicative of the losses AIGFP may realize over time. Based upon its most current analyses, AIG believes that any losses AIGFP may realize over time as a result of meeting its obligations under these derivatives will not be material to AIG."

It is probably easy to predict that hank Greenberg is going to be out making more mismanagement comments sooner rather than later.

AIG shares fell close to 12% yesterday down to $44.74.  Apparently shareholders aren’t rushing to believe the company after a credibility gap from when it originally claimed "immaterial CDO exposure" as shares are up a whole 0.5% at $44.99 in pre-market trading. 

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 9:34 am in Financial Stocks, , ,

Another Bad Day For Boston Scientific (BSX)

The bad days never seem to end at Boston Scientific (NYSE: BSX). The company has a heavy debt load from a bad acquisition of Guidant. The BSX stent business has been hurt by studies that question the safety of the devices.

Now the company has been told by a court that it must pay $431 million to a doctor who holds patents on certain IP in BSX drug-coated stents. According to the AP, Boston Scientific "plans to try to overturn the verdict in post-trial motions. If that’s unsuccessful, Boston Scientific says it will appeal."

With the company’s luck that is not likely.

BSX shares trade just above $12, near their 52-week low and down from the period high of $17.32.

Douglas A. McIntyre

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Posted on: February 12, 2008 – 9:20 am in Medical,

Warren Buffett Ready To Save Muni Bond Insurance (BRK-A, ABK, MBI, SCA)

Warren Buffett of Berkshire Hathaway (NYSE: BRK-A, BRK-B) just appeared on CNBC with his plan to save the bond insurance business in the U.S. for municipal bond issuers.  He noted that last week he sent an offer to the top three bond insurers with a plan to acquire the outstanding municipal bond insurance operations of each.  His offer was roughly 1.5-times the remaining premiums left on the life of each insurance contract.

While we did not get a list of these, the two obvious ones are MBIA inc. (NYSE: MBI) and Ambac Financial Group, Inc. (NYSE: ABK).  Presumably the third one would be FGIC, or likely it could be Security Capital Assurance Ltd. (NYSE: SCA).  Most shares are higher after Buffett came on CNBC with his plan:
SCA +9% at $2.24; MBI +3% at $14.00; ABK +4.5% at $10.96.

Mr. Buffett did note that this was initially a $5 Billion proposition and that he would keep all earnings inside the entities for a period of 10-years.  He also noted that one rebuffed his offer and two he has not heard back from.

What is important here is that this will at least take care of the municipal bond side even if those other bond insurance operations in mortgages, CDO’s, and CLO’s were to fail.  But Buffett is drawing his line in the sand on what risks he will take and which he will not take.  These plans would not include insuring mortgages, CDO’s and CLO’s.  That is why the bond insurers are not jumping at this offer.  They’d be giving away their top operations to feed their leeches.

He even made a note about how his new municipal bond insurance unit received a 2% premium merely to reinsure a muni that had already been insured so it could maintain its triple-A rating even if the bond insurer failed.  No wonder he’s willing to step up.  If you have a few billion dollars lying around and have a solid insurance holding company operations this sounds like a layup when you consider the fact that it takes the worst scenarios to cause municipal defaults.   

Perhaps the most important issue at hand is that this will at least put a floor on the blood-letting that has been seen in the municipal bond arena.  It won’t help the mortgage and CDO insurance operations, although there is an obvious tertiary benefit in that this at least in theory saves part of those businesses.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 8:54 am in Buffett, Financial Stocks, Turnarounds, , , , , , , ,

Verizon’s Next Patent Target: The Cable Guys (VZ, CHTR)

From Silicon Alley Insider

Last year, Verizon milked $117.5 million from Internet phone upstart Vonage in a long, ugly patent war. This year, it’s going after its real rivals — the cable companies — with similar suits.

Over the weekend, Multichannel News reported that Verizon is suing Charter Communications (CHTR) for infringing eight Internet phone patents, including two that Vonage was busted for infringing contined here.

Posted on: February 12, 2008 – 8:42 am in Cable Companies

Instead Of Being Bought, Yahoo! (YHOO) Buys

While waitng to be be bought by Microsoft (MSFT), Yahoo! (YHOO) has elected to buy Maven Networks for $160 million.

Yahoo! said it intends to invest in the growth of Maven’s overall video business, continuing to provide premium publishers with both publishing and new advertising solutions. Yahoo! intends to expand on the Maven offering with video monetization services allowing publishers to take advantage of Yahoo!’s industry leading display sales force and advanced technologies for delivering consumers more relevant advertising experiences, both of which help them maximize their video advertising dollars.

Maven’s platform is currently used to manage, distribute and monetize premium online video content for over 30 major media companies, including Fox News, Sony BMG, CBS Sports, Hearst, Gannett, Scripps Networks, and the Financial Times

Douglas A. McIntyre

Posted on: February 12, 2008 – 8:38 am in Mergers and Buy Outs,

Goldman Sachs Buy Rating Changes (LYV, PCP, LLL)

Live Nation (NYSE: LYV) was added to Goldman Sachs BUY list this morning and at a $10.46 close it sees some 45% upside.  Goldman Sachs also noted that it sees the third and final transition year leading into a significant equity appreciation potential for 2009 to 2010.

Precision Castparts Corp. (NYSE: PCP) was added to the America’s CONVICTION BUY LIST with some 44% upside to its $158 target.  Goldman notes that shares are oversold at -20% year to date.

L-3 Communications (NYSE: LLL) has been removed from the America’s CONVICTION BUY LIST as valuations are now appropriate and leaving only 13% upside to its price target.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 8:15 am in Analyst Calls, , ,

Evergreen Solar Prices Secondary Offering (ESLR)

Evergreen Solar Inc. (NASDAQ: ESLR) has priced its secondary share offering at $9.50 per share.  This is down from over $12.00 just a few days ago and under the $10.02 closing price of yesterday.

This discount pricing is a bit aggressive discounting compared to what this would have been expected considering the sell-off we had already seen, and it is a deeper discount than the market chatter was indicating just on Friday.  While Evergreen isn’t exactly the best solar player out there and while the company has had problems in the past compared to top solar stocks, the proceeds are being used for a plant manufacture and development and for general corporate proceeds rather than "rewarding insiders."  The original offering was for up to 20 million shares.  We had noted that this one might be oversold ahead of the secondary just on Friday.  That still looks to be the case here, but we’ll be the first to admit that this discounting was far too much when you consider the greater-than-peers sell-off seen last week.

The net proceeds to Evergreen before any overallotment and after initial fees will be some $145.16 million shares.  Deutsche Bank, Lazard, Pacific Growth, Simmons & Co., and ThinkEquity are all listed as the underwriters.

Shares are trading down over 2.5% pre-market at $9.75.

Jon C. Ogg
February 12, 2008

Posted on: February 12, 2008 – 8:04 am in Alternative Energy, Secondary Offering,