Today was a very strange day in Google Inc. (NASDAQ: GOOG) as far as a stock. As we suspected and went out with after seeing this too many times, NASDAQ has made a determination which will probably only cause minimal pain rather than catastrophic pain to many traders and investors. We do not have a new adjusted closing price besides that $341.43 as of yet, but you can bet one will be coming.
Here are NASDAQ comments from 5:01 PM EST:
If you have ever seen odd trading, Google Inc. (NASDAQ: GOOG) saw its fair share of odd trading. Shares had been up the entire day and right before today’s close there was a massive drop in the price of the stock. The close was $341.43, which would be an astronomic intraday drop after yesterday’s move and would mark a 52-week low. Its shares fell roughly $50.00 to $381.00 on Monday during the market meltdown. Today’s move was something else entirely. Unfortunately, this is the sort of thing that can major problems beyond just how it appears because this was also the end of the quarter. This is likely trading errors or a glitch of some sort, but below is more data.
Hartford Finl Svcs (HIG) Downgraded due to exposure to debt at troubled financial firms. Drops to $31.26 from 52-week high of $99.21.
Circuit City Stores (CC) The end is near. Hard to see how the retailer hangs on. Drops to $.72 from 52-week high of $9.65.
Reliant Energy (RRI) Cuts outlook and needs to raise capital. Down to $4.69 from 52-week high of $28.74.
Ap Pharma (APPA) Drug trial fails. Drops to $.63 from 52-week high of $2.35.
Douglas A. McIntyre
This weekend we gave many updates to our favorite stocks in the under $10 category. Of our stocks, Web.com (NASDAQ: WWWW) remains perhaps the cheapest of the internet stocks which fit within our screening criteria. Web.com is the old Website Pros, Inc. which traded under the "WSPI" ticker, and this stock has been poorly treated by the current market.
Charter Communications (CHTR) is still one of the largest cable companies in the US in a period where cable should be doing fairly well, Charter’s common stock is worthless at this point. It may trade at $.77 but that is a cruel joke for anyone holding the shares.
Charter cannot take advantage of the increasing markets in voice-over-IP and video-on-demand because its debt service is so remarkably high. Charter has almost $21 billion in long-term debt and will be lucky to have $750 million in operating income this year. Some of Charter’s bonds may go into default or get very close after the next quarter’s results. At that point, the shares, which should be at zero, will actually trade there.
Douglas A. McIntyre
This weekend we made new updates to our favorite list of stocks in the under $10 category. USEC Inc. (NYSE: USU) is currently our favorite stock under $10.00 in the alternative energy category. Is it fair to put a uranium enrichment supplier in the alternative energy universe? That depends on what side of the aisle you are on and how far you extend energy. This stock has been beaten, and there are many factors that have led us to believe that the stock has been trying to find a bottom.
This weekend we issued updated targets and scenarios for our favorite stocks in the under $10.00 universe, and Flextronics International Ltd. (NASDAQ: FLEX) was one of the value names that came in the screen out of the EMS universe in our screen for technology companies with low multiples in expected sales, earnings, and book value. During the current market turmoil there are of course many caveats that would not be quite as strong. Regardless of the environment, there were some very low valuation when we screened this company.
The Blackstone Group (NYSE: BX) is making changes to its structure in Asia, and these changes may allow it to become an investment banker and advisor rather than just a deal-maker or investor. The private equity giant has gone out and swiped key personnel from several investment banking firms to be based in Hong Kong and Beijing.
Last week, a consortium of ten states in the northeastern US held its initial auction of allowances to emit CO2. The Regional Greenhouse Gas Initiative (RGGI) has set a cap on carbon emissions of 188 million tons in 2009. Each of the more than 230 power plants in the ten states will be required to "pay" for carbon emissions with the carbon allowances at a rate of one allowance (usually called a credit) for each ton of CO2 emitted. Companies doing business in various aspects in these states include Constellation (NYSE:CEG), Consolidated Edison (NYSE:ED), and Public Service Enterprise Group (NYSE:PEG), among others.
The Conference Board has released some surprising data that was stronger than many would have guessed. The September confidence index came in at 59.8, up from 58.5 in August. The Present Situation index fell to 58.5 from 65.0 in August, while the Expectations Index rose to 60.5 from 54.1 in the prior month. Based upon the malaise seen this week and last week, these numbers may seem off or just wrong, and there is an explanation for this.
CBS (CBS) continues to make the argument that network television advertising will do relatively well during a recession. Wall St keeps rejecting the idea. CBS shares are now down to $14.43, off over 50% from their 52-week high. The smart bet is that they will go lower.
But, there is an idiot’s case for buying CBS which may have some merit. CBS picked up technology internet company CNET just a few months ago. Most Wall St. observers thought that the network overpaid. The disappointment is priced into the CBS shares. Since internet advertising is still growing, the results from CNET could surprise CBS shareholders. Income from network TV almost certainly will not. The odds may be long, but CBS could rally on good CNET numbers
Douglas A. McIntyre.
There have been some interesting upgrades in technology stocks this morning. It wasn’t so much a goal of analysts trying to mark the bottom on yesterday’s sell-off, but these appear to be on valuation.
Jon C. Ogg
September 30, 2008
CMGI Inc. (NASDAQ: CMGI) is now ModusLink Global Solutions, Inc. (NASDAQ: MLNK). Shares are now open for trading after opening at $9.00. Last night the company reported earnings, but traders will now be focused on the company’s name change and stock ticker change as it sheds its last remnants of being the old internet incubator. The company’s main operations are in the arena of global supply chain business process management.
Reliant Energy Inc. (NYSE: RRI) is looking like a classic example of how things are changing in the credit markets. The electricity and energy services provider lowered its guidance because of Hurricane Ike and lower power prices. It is also raising $1 billion in new capital to be combined with $1.2 billion in existing liquidity as collateral on existing contracts covered under credit enhanced retail structures with Merrill Lynch. That is being unwound.
Oil baron and billionaire T. Boone Pickens said early this morning on a CNBC interview that the price of crude is unlikely to fall much below $100 per barrel. His argument is fundamental rather than technical and he noted his opinion is because of price supports by producers.
He said OPEC would support oil at $100.00 per barrel, but he noted that he isn’t sure if this is the case yet today. He further noted that those who believe oil is going back down to $60.00 per barrel do not understand how the countries which own the oil think and he doesn’t believe they will let it go back down to that level.
Huntsman Corp. looks like it may be trading up 50% pre-market after a recent battering. This chemicals and products maker had been down and out after its private equity buyout from Apollo Management & Hexion was terminated by the buyers. In a twist of fate, a Delaware judge has issued an opinion refusing toallow Apollo to walk away from its $6.5 Billion buyout. For the private equity firms, the hunters may have become the hunted.
Sirius (SIRI) management has been desperate to convince shareholders that the merger of the two satellite radio companies would work. Wall St. has not bought into the pitch, but there are two or three things that could change that. None of these is short-term. Sirius now trades at $.68, down from a 52-week high of $3.94. There is a question of whether it can maintain its listing on the NYSE.
Conexant Systems Inc. (NASDAQ: CNXT) did something unusual even for a small cap stock. The communications chip company raised its guidance. It now sees EPS of $0.24 to $0.26 vs. $0.15 estimates. It also reiterated Q4 revenues at $120 to $125 million vs. estimates of $122.27 million. It now expects core gross margins of 54% to 55% rather than 51% to 52% because of a richer than anticipated product mix. A semiconductor company for communications chips raising guidance in this environment is rather rare, even for a $150 million market cap stock. The company also attributed better than expected cost management. Shares are indicated up around $3.00 after a $2.88 close, although so far no volume has been seen. Its 52-week trading range is $2.68 to $14.80.
Jon C. Ogg
September 30, 2008
By John Tamny, RealClearMarkets
Early 20th century writer Randolph Bourne was probably most famous for proclaiming that war is "the health of the state." Whatever the good or bad of wars, they very certainly accrue to the health of governments conducting them.
These are some of the key upgrades from analysts we are focusing on this Tuesday morning:
Jon C. Ogg
September 30, 2008
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