Daily Archives: November 7, 2008

The 52-Week Low Club (GNW)(UIS)(SRZ)(GGP)(KOOL)(DPTR)

Sad_clownGenworth  (GNW) DIvidend cut. Drops to $2.55 from 52-week high of $28.21.

Unisys (UIS) No news but falls over 30% to $.79 from 52-week high of $7.90.

Sunrise Assisted Living (SRZ) Large quarterly loss. Falls to $1.82 from 52-week high of $34.87.

General Growth (GGP) Analayst downgrade still hurting. Falls to $1.91 from 52-week high of $51.24.

THERMOGENESIS (KOOL) Product recall and quarterly loss. Falls to $.44 from 52-week high of $2.25.

Delta Petroleum (DPTR) Offer to buy company falls through. Stock off to $3.89 from 52-week high of $28.37.

Douglas A. McIntyre

Posted on: November 7, 2008 – 3:49 pm in HI/LOW, , , , , ,

Berkshire Hathaway Earnings Could Set Next Week’s Trends (BRK-A, BRK-B, GS, GE, BNI)

Buffett_imageAfter today’s close, we’ll get to see earnings out of conglomerate, insurance giant, and recent bailout investor Berkshire Hathaway Inc. (NYSE: BRK-A) NYSE: BRK-B).  Warren Buffett and friends do not get many analysts covering the stock, so using "estimates" is not really a norm here.  Earnings estimates are not as important as what he is doing longer-term and which issues he discusses.

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Posted on: November 7, 2008 – 2:52 pm in Buffett, Conglomerates, Earnings, Financial Stocks, , , , ,

E*TRADE and $800 Million E*TARP Funds (ETFC)

Etrade_logoE*TRADE FINANCIAL Corporation (NASDAQ: ETFC) has announced its intent to participate in the Treasury’s TARP bailout funding program.  The online brokerage firm confirmed that it filed an application to receive $800 million of funding.

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Posted on: November 7, 2008 – 1:57 pm in Banking, Brokerage Firms, Internet,

GM (GM): First Half Of 2009 May Be The End Of The Road

AngrybearGM (GM) released earnings and, in the process, the company made it clear that it may not make it to the middle of next year without help.

"Even if GM implements the planned operating actions that are substantially within its control, GM’s estimated liquidity during the remainder of 2008 will approach the minimum amount necessary to operate its business. Looking into the first two quarters of 2009, even with its planned actions, the company’s estimated liquidity will fall significantly short of that amount unless economic and automotive industry conditions significantly improve, it receives substantial proceeds from asset sales, takes more aggressive working capital initiatives, gains access to capital markets and other private sources of funding, receives government funding under one or more current or future programs, or some combination of the foregoing."

Douglas A. McIntyre

Posted on: November 7, 2008 – 11:40 am in Autos,

GM (GM) Earnings: US And Emerging Markets Are Bad, Cash Gets Low

Gm20jpeg20imageTrading in GM’s (GM) shares was halted just before earnings came out. They may want to keep trading on hold for a year or two and keep the stock from going to zero. The company’s cash position eroded over the course of the quarter to $16.2 billion from $21 billion.

For the third quarter, revenue fell $5.8 billion to $37.9 billion. A key measurement of the company’s performance, operating cash flow, showed a loss of $6.9 billion compared with a negative $2.5 billion in the same quarter last year.

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Posted on: November 7, 2008 – 11:33 am in Autos,

Goldman Sachs (GS) Goes Whole Hog On Jobless Forecast

Unemply_2From Goldman Sachs (GS) by way of MarketWatch:

"The unemployment rate is expected to rise to 8.5% by the end of next year and inch even higher in early 2010, economists for Goldman Sachs wrote Friday. The cumulative trough-to-peak increase of more than 4 percentage points in the jobless rate would be the most since World War II, they said. Goldman analysts lowered growth forecasts for the next three quarters, and said they now expect the Federal Reserve to cut its interest rate target to 0.50% by December. "The main reason for these changes is the accumulation of evidence that U.S. domestic demand and production are dropping sharply," they wrote. "We do not see a resumption of anything close to trend growth before 2010."

Douglas A. McIntyre

Posted on: November 7, 2008 – 11:03 am in Economy,

Will BusinessWeek Cut Its Publishing Schedule To Twenty-Six Times A Year?

95129c_2The rallying cry for magazine and newspaper executives is "Cut print costs, rely on the web."

It makes all the sense in the world. Printing, paper, postage, and other transportation costs keep rising. Print advertising linage keeps dropping.

So far this year, most of the major business magazines and newsweeklies have lost anywhere from 15% to over 30% of their advertising pages.

According to the latest numbers from media newsletter MIN, US News, which will cut its publishing frequency to monthly from weekly next year, has lost 31% of its ad pages. BusinessWeek and Forbes are both down about 16%.

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Posted on: November 7, 2008 – 10:40 am in Old Media,

Will BP Buy Chesapeake? (BP, CHK)

Chesapeake_logoBp_logoBP plc (NYSE:BP) shares are up about 2.5% pre-open today on rumors that the British petroleum giant is considering making an offer for Chesapeake Energy (NYSE:CHK). Chesapeake is the largest natural gas producer in the US, and BP has already paid more than $3.5 billion for some of Chesapeake’s assets.

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Posted on: November 7, 2008 – 10:31 am in Mergers and Buy Outs, Oil & Gas, Rumors, ,

The New Goldman Sachs Model: Quarterly Losses (GS, C, BRK-A)

Goldman_sachs_logo_2BurningmoneyGoldman Sachs Group (NYSE: GS) had been the one spot in the brokerage sector which was immune from the credit crunch and nearly immune from the mortgage mess.  In fact, the company made a fortune betting against mortgages from 2007 into 2008.  But now it is a mere bank holding company, and the word is being passed around that the former "Golden Slacks" will report its first quarterly loss since coming public.  Talk of losses at the brokerage firm gone banker first started coming to light a couple of weeks ago, and now it is becoming the new "whisper number" that Goldman Sachs won’t be profitable.

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Posted on: November 7, 2008 – 9:50 am in Banking, Brokerage Firms, Buffett, Cramer, Earnings Warning, Financial Stocks, , ,

Frontier Oil, Refiner Earnings Lagging Peers (FTO, SUN, WNR, VLO)

Oil_refinery_image_2Frontier Oil (NYSE:FTO) released its third quarter earnings yesterday, and the news was not good. EPS was $0.70, down from $1.28 a year ago, and below analysts’ estimates of $0.73. Revenues rose to $2.2 billion, up 58% from a year ago.

Unlike Sunoco (NYSE:SUN) or Western Refining (NYSE:WNR), Frontier didnot say anything about trying to sell any assets. Valero Energy (NYSE:VLO) appears to have recently signaled that the worst is behind too.

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Posted on: November 7, 2008 – 8:52 am in Earnings, Oil & Gas, , , ,

Low Oil Toll: Conoco Delays Saudi Refinery (COP, TOT, CVX)

Oil_refinery_imageAbout two and a half years ago when crude oil prices were heading up at a pace never before seen, the Saudi Arabian oil minister claimed that there was plenty of oil, but not enough refining capacity. To show their good faith, the Saudis would help build two refineries in Saudi Arabia with a total refining capacity of 1 million barrels per day.  The Saudis partnered with ConocoPhillips (NYSE:COP) to build a 400,000b/d refinery and with Total (NYSE:TOT) for a 600,000 b/d refinery atYanbu.

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Posted on: November 7, 2008 – 8:46 am in Oil & Gas, , ,

As Unemployment Hits 6.5%, Those Expecting 7% Now Bracing for 8%

UnemplyIf you were looking for great news on the jobs report this morning, you probably believed the guy telling that "NOT JOKE" in the Borat movie.    Unemployment came in at a monstrous 6.5% rather than the 6.1% given for September.  This was the worst unemployment rate since 1994.

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Posted on: November 7, 2008 – 8:34 am in Economy

Top Pre-Market Analyst Upgrades (ANF, BMY, CECO, EW, WYE)

Money_stack_picThese are some of the top analyst upgrades we have seen this Friday morning:

  • Abercrombie & Fitch (ANF) Raised to Hold at Jefferies.
  • Bristol-Myers Squibb (BMY) Started as Buy at Goldman Sachs.
  • Career Education (CECO) Raised to Neutral from Sell at Piper Jaffray.
  • Edwards Lifesciences (EW) Started as Buy at Piper Jaffray.
  • Wyeth (WYE) Started as Buy at Goldman Sachs.

Jon C. Ogg
November 7, 2008

Posted on: November 7, 2008 – 8:09 am in Analyst Calls, , , , ,

Top Pre-Market Analyst Downgrades (ACF, CLF, CVTX, PFE, SNY, THQI)

Down_arrow_redThese are some of the top analyst downgrades we have seen this Friday morning:

  • Americredit (ACF) Raised to Market Perform at FBR.
  • Cliff’s Natural resources (CLF) Cut to Market Perform at FBR.
  • CV Therapeutics (CVTX) Cut to Sell at Citigroup.
  • Pfizer Z(PFE) Started as Sell at Goldman Sachs.
  • Sanofi-Aventis (SNY) Cut to Sell at UBS.
  • THQ Inc. (THQI) Cut to Hold at Citigroup.

Jon C. Ogg
November 7, 2008

Posted on: November 7, 2008 – 8:08 am in Analyst Calls, , , , , ,

Sprint (S) Earnings: Customers Go On Vacation, Won’t Return

Sprint (S) had another dismal quarter. Revenue fell 12% to $8.8 billion. Its net loss was $326 million compared with a $64 million profit.

The company served 50.5 million customers at the end of the period, down from 54.0 million at the end of the third quarter of 2007. For the quarter, total wireless customers declined by a net 1.3 million.

Nothing else Sprint had to say mattered. It can’t stay in business without customers.

Douglas A. McIntyre

Posted on: November 7, 2008 – 7:59 am in Earnings Warning,

Ford (F) Earnings: Still Cutting Costs, No Plans For Better Cars

Ford1Ford (F) had one piece of good news. It is still cutting costs. It is on track to cut annual expenses by $5 billion compared with 2005.

For obvious reasons, the company’s earnings highlighted how much cash the company has, which is $29.6 billion between hard currency and lines of credit. No one thinks that is enough to get it through the current disaster in the auto industry.

However, there was absolutely nothing of note in the entire announcement to indicate that Ford was putting a big load of effort behind building better cars.

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Posted on: November 7, 2008 – 7:16 am in Earnings,

Motorola (MOT) Takes On Water From Samsung And Qualcomm

MotMotorola (MOT) is a first class example of what Ivy League business school professors do not want their students to know. It might frighten the horses. At some companies, there is no bottom. Every time things reach the point where they could not possibly deteriorate, they do.

Word came yesterday that the one place where Motorola still had the No.1 spot in handset market-share had fallen. That would be its home market, the US.

Samsung took the trophy, and the last thing Motorola had to brag about other than layoffs is gone.

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Posted on: November 7, 2008 – 6:22 am in Wireless, ,

China: Worse Than Anyone Imagined

ChinaThere have been some minority reports from pessimists like NYU economist Nouriel Roubini which say that China’s economy may be faltering as badly, if not worse, than America’s. No one believes that because it is too staggering to think that something so big growing at 10% a year could ever do anything worse than cool off a bit.

But, once something makes it to the front page of The New York Times, it is true everywhere and always.

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Posted on: November 7, 2008 – 6:05 am in China

Auctioning Detroit In Pieces: $50 Billion For GM (GM)

Batmobile512GM (GM), Ford (F), and Chrysler managements are shuttling in and out of Washington trying to get both the people leaving and the people coming in to lend them $30 billion or $40 billion. Their argument is that the tremendous drop in domestic vehicle sales will put them out of business.

If one or all of The Big Three stops doing business, hundreds of thousands of jobs will be lost and the nation’s tax base will take a hit at a time when the Treasury cannot afford that. But, none of the US car companies is going to stop operating, even for a day.

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Posted on: November 7, 2008 – 5:47 am in Autos, , ,

Microsoft (MSFT): A Final “No” To Yahoo! (YHOO)

Yahoo_logoIt may have occurred to Microsoft (MSFT) that Yahoo! (YHOO) is so badly wounded by its own poor management that a buyout of the portal company would be more trouble than it is worth. Now that Google (GOOG) has walked away from a partnership to sell search advertising for Yahoo!, the smaller company is faced with poor revenue performance and relatively high costs.

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Posted on: November 7, 2008 – 5:13 am in Mergers and Buy Outs, , ,