Daily Archives: November 11, 2008

Worst Corporate Press Release Of The Day: Harold’s

R218533_855025 For the management that drove its company into Chapter 11, there is always the option of telling as many people as possible:

Harold’s, an 18-state chain of traditional, classic styled ladies and men’s specialty apparel stores for customers between the ages of 30 and 50, announced today that it is closing its doors for good. Yesterday, an Oklahoma bankruptcy court approved plans for the 60-year-old retail chain to begin a store-wide Going-Out-of-Business sale. One store will close in Mississippi.

"We’d like to thank our loyal customers for their many years of patronage by offering incredible values on the merchandise in the store. As always, our knowledgeable Associates will provide our customers with the same high level of service," stated Ronald S. Staffieri, Chief Executive Officer of Harold’s Stores, Inc.

Will the last "Associate" please shut our the lights when he leaves?

Douglas A. McIntyre

Posted on: November 11, 2008 – 5:51 pm in Press Digest

MercadoLibre Trying To Catch Up (MELI)

Mercadolibre_logoMercadoLibre, Inc. (NASDAQ: MELI) may have fallen a long ways from back when Jim Cramer called this one his favorite tech calls from Latin America, but the company is up in after-hours trading and took back most of today’s losses after its earnings.

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Posted on: November 11, 2008 – 4:47 pm in Earnings, Emerging Markets, Internet,

The 52-Week Low Club (DRYS)(FMCN)(GM)(S)(C)(TSN)(GNW)(GGP)

Sad_clownGeneral Growth Properties (GGP) Concerns about bankruptcy. Falls to $.33 from 52-week high of $51.24.

Genworth (GNW) Moody’s downgrade causes shares to plunge to $1.19 from 52-week high of $28.21.

Tyson Foods (TSN) JP Morgan downgrades stock after its posts earnings. Falls to $4.82 from 52-week high of $19.50.

Sprint Nextel (S) Still falling after poor earnings. Dips to $2.37 from 52-week high of $16.37.

Citigroup (C) More concerns about banking write-offs. Drops to $10.34 from 52-week high of $37.50.

GM (GM) Bankruptcy still in the picture. Down to $2.75 from 52-week high of $32.19.

Focus Media (FMCN) Turns in extremely disappointing numbers. Sells off to $7.54 from 52-week high of $60.73.

Dryships (DRYS) Food and energy shipments drop. Down to $9.93 from 52-week high of $116.43.

Douglas A. McIntyre

Posted on: November 11, 2008 – 3:55 pm in HI/LOW, , , , , , , ,

Institutional Broker Defends Goldman Sachs (GS)

Goldman_sachs_logoSandler O’Neill is an institutional brokerage firm that many individual investors have not ever heard of, yet it has been around for roughly 20 years.  It also does business in some form or fashion with most of the big institutions on Wall Street.  So it is with no surprise that the firm sticking its flag in the sand and calling Goldman Sachs Group Inc. (NYSE: GS) a "buy" is actually helping shares of broker-turned-banker stock.

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Posted on: November 11, 2008 – 3:22 pm in Analyst Calls, Banking, Brokerage Firms,

A Contrarian View On GM (GM), And A Bad One

Gm20jpeg20image JPMorgan likes GM’s (GM) bonds. On the surface what is not to like?

According to Reuters, "GM’s benchmark 8.375 percent bond due 2033 has dropped to 25.75 cents on the dollar, from 36.5 cents at the end of October, according to MarketAxess. The bonds had traded at more than 80 cents on the dollar at the beginning of the year and currently yield 32.5 percent."

If GM goes Chapter 11, which is likely if the federal government does not come in soon, common shareholders will see their investment drop to zero. Depending on what a bankruptcy court does with UAW and bank loan claims, the bonds may end up worthless as well.

Douglas A. McIntyre

Posted on: November 11, 2008 – 2:53 pm in Autos,

Government To Offer Major Changes To Some Mortgages, Unemployment Becomes The Enemy

For_sale_signIn a move that could create a bottom for the housing market by the middle of next year, the government is taking unprecedented steps to keep people in their homes.

"We need to stop this downward spiral," said James Lockhart, director of the Federal Housing Finance Agency.

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Posted on: November 11, 2008 – 2:42 pm in Housing

Huffington, Politico, Slate: Big Post-Election Audience Drop Begins

Chart_2The drop-off in traffic to political websites now that the election is over has begun in force.

According to figures provided to 24/7 Wall St. by online audience measurement firm Hitwise, Slate lost 75% of its audience from November 5 to November 9.

The Huffington Post lost half of its audience over the same period and Politico lost 50%.

Are the numbers right? The sample sizes are small, so they are probably not exactly accurate, but the trend is hard to deny.

Douglas A. McIntyre

Posted on: November 11, 2008 – 1:34 pm in Media

Caesar Shows Thumb Down on Las Vegas Sands (LVS)

Las_vegas_sands_logo_2Las Vegas Sands Corp. (NYSE: LVS) has just re-opened for trading after being halted all day.  After the news today it is of little surprise that the stock is being hit hard after the severe discount of its new financing package.  This stock opened at $6.50 and 10 million shares traded hands as of 12:56 PM EST. They are now at $6.40. 

We previously noted the financing package was a two-sided issue, but now the company said its board of directors approved this without shareholder approval to avoid further damage from delay.  The Chinese have also apparently said that they are not going to rescue the Macau operations if needed.  Why would they? They could get it for free without using a totalitarian seizure.

Jon C. Ogg
November 11, 2008

Posted on: November 11, 2008 – 12:59 pm in Casinos, Secondary Offering, Trading Alert,

Merrill Lynch (MER) CEO Slips Blame By Calling Current Environment Similar To Depression

MerrillJohn Thain of Merrill Lynch (MER) spent most of his time at the financial firm saying that the markets would improve as would the fortunes of his company. He was consistently and remarkably wrong.

More recently, he has turned to comparing the current economic situation to the early stages of The Great Depression.

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Posted on: November 11, 2008 – 12:26 pm in Economy,

Time to Pull the Plug on General Motors (GM)

By John Tamny  of RealClearMarkets

Ludwig Von Mises once wrote that the entrepreneur who fails to use his capital to the "best possible satisfaction of consumers" is "relegated to a place in which his ineptitude no longer hurts people’s well-being." The latest losses at General Motors reveal yet again that it is the living embodiment of managerial ineptitude, and to insure that it no longer fails its customers while harming the well-being of Americans more broadly, it’s essential to let the firm die.

Read more….

Posted on: November 11, 2008 – 12:16 pm in Uncategorized,

Drug-Eluting Stent Data Shows More Promise (BSX, ANPI, JNJ, SRDX, MDT, ABT)

Stent_imageThe Massachusetts Department of Public Health funded a study which is showing further evidence to support the use of drug eluting stents over bare metal stents in heart attack patients.  This study measured stent use in diabetic patients. 

While the study did not show which exact stents were under comparison, it does at least give some timeframes.  The larger historic drug-eluting stents and their makers are Taxus by Boston Scientific (NYSE: BSX) with Angiotech (NASDAQ: ANPI) as the molecule maker for Taxus, and  Cypher by Johnson & Johnson (NYSE: JNJ) with SurModics (SRDX) as the molecule maker for Cypher.

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Posted on: November 11, 2008 – 12:01 pm in Medical, , , , , ,

Fannie Mae And Freddie Mac: Cases For And Against Housing Recovery

HouseThe head of Toll Brothers (TOL) said the housing market could not get worse, but it has anyway. People were not even bothering to come and see the homes his company builds.

Those comments helped drive the market down nearly 3%, but the federal government will not rest in its efforts to make Mr. Toll appear silly.

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Posted on: November 11, 2008 – 11:11 am in Housing, , , , , ,

One Solar Stock Stays Ahead of the Pack (ENER, JASO, FSLR, SPWRB, CY)

Solar_panel_picOne year ago, the share price for Energy Conversion Devices (NASDAQ:ENER) was $29.31. Shares rose to a 52-week high of $83.33, closing yesterday at $38.04. That’s off 52% from the high, but nearly 30% higher than a year ago.  However, Energy Conversion is still the only solar panel company of the major solar go-to stocks that shows a gain for the past 12 months.

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Posted on: November 11, 2008 – 11:02 am in Alternative Energy, , , , ,

Las Vegas Sands Gets A Lifeline (LVS)

Las_vegas_sands_logoLas Vegas Sands Corp. (NYSE: LVS) initially showed up on our day trader alerts this morning as one of the Macau casino movers.  But right before the open Las Vegas Sands announced that it has reached a deal to raise capital.  The casino has priced a public offering of a whopping 181,818,182 shares of common stock, plus 5,196,300 shares of 10% Series A Cumulative Perpetual Preferred Stock, and warrants to purchase an aggregate of approximately 86,605,173 shares of common stock at an exercise price of $6.00 per share.

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Posted on: November 11, 2008 – 10:10 am in Casinos, Secondary Offering,

Chesapeake Energy: Still Raising Cash (BP, CHK, STO, PXP)

Chesapeake_logoIf BP plc (NYSE:BP) plans to buy Chesapeake Energy (NYSE:CHK) as the rumor mill has suggested, it had better hurry up while there’s still something left. Early this morning, Chesapeake announced that it had sold a 32.5% interest in its Appalachian Marcellus Shale assets to StatoilHydro (NYSE:STO), Norway’s state oil company. Chesapeake banked $3.375 billion in exchange for about 600,000 net acres.

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Posted on: November 11, 2008 – 9:50 am in Oil & Gas, , , ,

24/7 Wall St. Day Trading Alert (FMCN)(SGMO)(OPTR)(GS)(LVS)(WYNN)(MPEL)

Cammonopoly_wideweb__430x3250Focus Media (FMCN) is getting crushed this morning after posted bad numbers. Details..

Sangamo Biosciences (SGMO) ran into drug trial troubles and will trade way down.

Optimer Pharmaceuticals (OPTR) is ready for a big move up after good results from its new antibotic product.

Goldman Sachs (GS) is ready to sell off on concerns about earnings and the potential need to raise more cash.

The Las Vegas Sands (LVS) could lose it casino in Macau. The is causing moves in Wynn (WYNN) and Melco Crown  (MPEL).

Douglas A. McIntyre

Posted on: November 11, 2008 – 9:11 am in Research, , , , , ,

Top Pre-Market Analyst Upgrades (FRPT, INFY, NZ, OPTR, UTHR, USB, VMW)

Money_stack_picThese are the top analyst upgrades we are seeing from Wall Street early this Tuesday morning:

  • Force Protection (NASDAQ: FRPT) Raised to Buy at Collins Stewart.
  • Infosys (NASDAQ: INFY) Started as Outperform at William Blair.
  • Netezza (NYSE: NZ) Started as Outperform at Oppenheimer.
  • Optimer Pharmaceuticals (NASDAQ: OPTR) Raised to Outperform at Baird.
  • United Therapeutics (NASDAQ: UTHR) Started as Buy at Deutsche Bank.
  • US Bancorp (NYSE: USB) Raised to Hold from Sell at Sandler O’Neill.
  • VMware (NYSE: VMW) Started as Perform at Oppenheimer.

Jon C. Ogg
November 11, 2008

Posted on: November 11, 2008 – 7:42 am in Analyst Calls, , , , , , ,

Top Pre-Market Analyst Downgrades (AA, AZ, ACAS, CAR, CMA, HTZ, KFN, SGMO, TM)

Down_arrow_redThese are the top early bird analyst downgrades we are seeing with more than two hours to the open on this Tuesday morning:

  • Alcoa (NYSE: AA) Cut to Market Perform at FBR.
  • Allianz (NYSE: AZ) Cut to Hold from buy at Citigroup.
  • American Capital (NASDAQ: ACAS) Cut to Market Perform at William Blair; Cut to Hold at BB&T.
  • Avis Budget (NYSE: CAR) Cut to Underweight at Barclays.
  • Comerica (NYSE: CMA) Cut to Hold at Deutsche Bank.
  • Hertz (NYSE: HTZ) Cut to Equal Weight at Barclays.
  • KKR Financial (NYSE: KFN) Cut to Sell at Citigroup.
  • Sangamo Biosciences (NASDAQ: SGMO) Cut to Neutral at Merriman Curhan Ford; Cut to Sell at Piper Jaffray.
  • Toyota (NYSE: TM) Cut to Underweight at HSBC.

Jon C. Ogg
November 11, 2008

Posted on: November 11, 2008 – 7:34 am in Analyst Calls, , , , , , , , ,

Treasury Starts To Run Out Of Bailout Money

TreasuryWhen the Congress approved the bailout fund requested by Mr. Paulson, it earmarked $700 billion for the program, but the first installment was half of that. Only $60 billion of the initial piece is left.

Paulson is going to have to make a pitch to get the next slug of cash and he may find that he faces a hard sell.

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Posted on: November 11, 2008 – 6:30 am in Banking

China Can’t Outrun The Trouble

ChinaSix hundred billion dollars may be a lot of money, even by national bailout standards, but it won’t save China from a recession.

Based on data release overnight, China reported the slowest export growth in four months. Imports suffered as the Chinese consumer felt a bit more impoverished. With real estate prices falling and the Shanghai stock market off nearly 70% from its high, the average citizen in the world’s largest country by headcount has to worry about his job.

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Posted on: November 11, 2008 – 6:17 am in China