Daily Archives: November 21, 2008

The 52-Week Low Club (C)(FL)(JPM)(NYT)(BAC)(DELL)

Sad_clownFoot Locker (FL) Cuts earnings outlook. Falls to $3.65 from 52-week high of $18.19.

Citgroup (C) Still concerns about whether government will have to step in to stop bleeding. Down to $3.05 from 52-week high of $35.29.

JP Morgan (JPM) Layoffs and earnings concerns. Drops to $19.69.

The New York Times (NYT) October revenue down. Dividend cut. End of the line. Sells down to $4.95 from 52-week high of $21.14.

Bank of America (BAC) Sucked down by Citi selling. Plunges to $10.01 from 52-week high of $47.

Dell (DELL) Reasonable earnings but iffy forecast. Drops to $8.72 from 52-week high of $28.40.

Douglas A. McIntyre

Posted on: November 21, 2008 – 3:50 pm in HI/LOW, , , , , ,

Buffett Tells Fox About Goldman, Obama, Autos, Stocks & More (BRK-A, GS)

Buffett_fox_2Warren Buffett of Berkshire Hathaway Inc. (NYSE: BRK-A) will be appearing on Fox Business News around the close of the market today, and we have been provided some of the information being discussed.  Mr. Buffett noted issues such as his shot at being Treasury Secretary, the future of Goldman Sachs Group (NYSE: GS), unemployment, Autos, the price of Berkshire Hathaway, and more.

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Posted on: November 21, 2008 – 2:57 pm in Buffett, Conglomerates, ,

SIRIUS vs. Charter: Which Disappears First? (SIRI, CHTR)

BurningmoneyEveryone knows about the old $1.00 stock limit for a regular NASDAQ listing.  This $1.00 listing requirment rule has been under a moratorium until after the first of the year so that NASDAQ would not have to boot off many of its key component or most active share volume stocks.  But many companies are already signaling an intent to conduct a reverse stock split or to take other actions to maintain a stock listing.  SIRIUS XM Radio Inc. (NASDAQ: SIRI) and Charter Communications Inc. (NASDAQ: CHTR) are both in the soup with NASDAQ requirements.  They are also debt-ridden with severely negative values on a tangible asset basis.  These and other issues at hand may make initial listing maintenance steps ultimately irrelevant.

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Posted on: November 21, 2008 – 1:37 pm in Cable Companies, OTC, Satellite, Shareholder Issues, ,

Citigroup (C) Finally Gets It Right By Considering Auction Block

DataAt last Citigroup (C) has decided to do something to save itself beyond having town hall meetings and firing tens of thousand of people.

Shares of the big bank fell to a low of $3.57. In the summer of 2007, that stock traded about $52.

Finally, Citi has determined that it may not have the people or the balance sheet to stay in business on its own.

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Posted on: November 21, 2008 – 12:05 pm in Banking, , , ,

New Chips Can’t Save AMD (AMD)(INTC)

AmdAfter bad news from its larger rival Intel (INTC), AMD (AMD) backed its own forecasts. AMD has its new Opteron processors. According to the company, the product has up to 20% faster performance with 35% less power-consumption when idle compared to the previous generation. But, the market found it hard to believe that AMD could do well while Intel does poorly. In a sense, that was right. Just days ago, The Semiconductor Industry Association said sales chip sales revenue would fall 5.7% next year.

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Posted on: November 21, 2008 – 10:39 am in Semiconductor, ,

Is Gap (GPS) Back From The Dead?

Is retailer Gap (GPS) back from the dead? At least two analysts think so following the company’s solid third quarter results and guidance after the close. This morning, Gap’s stock is trading 10% higher.

Gap reported third quarter EPS of $0.35, 1 cent better than the analyst estimate of $0.34. Revenue for the quarter was $3.6 billion, versus the consensus of $3.57 billion. The company also reaffirmed their FY08 EPS guidance of $1.30 to $1.35. Even a slight beat and a reaffirmation of guidance is a huge positive in this brutal retail environment.

Read more….

Posted on: November 21, 2008 – 10:10 am in Retail

Has Gap Finally Found Redemption? (GPS)

Gap_logoIf you have read us for very long, you will know how critical we have been of Gap, Inc. (NYSE: GPS).  The company just couldn’t get it right.  This was a fairly tale growth story of the 1990’s, but then its size, its off-shoots, and its own direction did not migrate along with Joe Public.  But sometimes enough is enough.  Gap may finally be getting on the right track.

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Posted on: November 21, 2008 – 9:32 am in Earnings, Retail, Turnarounds,

Warren Buffett Double Dipping in USG (USG, BRK-A, FFH)

Buffett_imageUSG Corporation (NYSE: USG) shares are surging this morning.  The sheet rock and building products company has reported that it has entered into an agreement to sell a total of $400 million of 10 percent contingent convertible senior notes due 2018.  What is more important is who it is selling too: Berkshire Hathaway, Inc. (NYSE: BRK-A) and Fairfax Financial Holdings Limited (NYSE: FFH).

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Posted on: November 21, 2008 – 9:04 am in Buffett, Conglomerates, Housing, Insider Activity, , ,

Obama Camp Denies Pre-Packaged Chapter 11 Plan For Detroit

Batmobile512So much for the Bloomberg report that the new administration would set up a pre-packaged bankruptcy for GM (GM) and perhaps other car companies.

According to Reuters, President-elect Barack Obama’s transition team is not exploring a prepackaged bankruptcy plan for U.S. automakers, officials from Obama’s team said on Friday.

Douglas A. McIntyre

Posted on: November 21, 2008 – 8:53 am in Autos,

Lee Scott Out At Wal-Mart (WMT)

Walmart_logoWal-Mart Stores Inc. (NYSE: WMT) is doing what we believe they should have done two-years ago.  The board of directors has elected Mike Duke to replace Lee Scott as President & CEO of Wal-Mart.  The effective date is February 1, 2009.

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Posted on: November 21, 2008 – 8:48 am in Management Change, Retail,

A Takeover in the Oil & Gas Minis (ROYL, ASPN)

Oil_well_logo_2Now this is how it’s supposed to work. Royale Energy (NASDAQ:ROYL) has initiated an exchange offer for up to 55% of the outstanding shares of an OTC bulletin board energy company called Aspen Energy (OTC.BB:ASPN). There are about 7.26 million shares of Aspen stock outstanding, so Royale is looking to pick up control of the company for about $4 million.

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Posted on: November 21, 2008 – 8:19 am in Mergers and Buy Outs, Oil & Gas, ,

Not Much Sunshine in Canada Either (CSIQ)

Solar_panel_picCanadian solar panel maker Canadian Solar Inc. (NASDAQ:CSIQ) reported earnings this morning before the market opened. Revenue for the third quarter was $252.4 million, higher than expectations of $248 million. Analysts expected EPS of $0.54, and instead got EPS of $0.31. The EPS included a foreign exchange loss of $17.3 million and a mark-to-market gain on derivatives of $7.4 million.

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Posted on: November 21, 2008 – 8:17 am in Alternative Energy, Earnings,

Goldman Sachs (GS) Sees 9% Unemployment And 5% GDP Contaction

According to Bloomberg, "Goldman Sachs Group Inc. increased its recession estimates, saying gross domestic product is declining at a 5 percent annual rate in the current quarter and will drop 3 percent and 1 percent in the next two quarters. Unemployment will reach 9 percent by the fourth quarter of 2009."

Douglas A. McIntyre

Posted on: November 21, 2008 – 7:54 am in Economy,

Top Pre-Market Analyst Upgrades (ARMH, BMRN, CYBX, FFIV, GPS, JNPR, LTD, MSFT, MYGN, NVTL, CRM)

These are the top pre-market analyst upgrades and positive calls we are seeing from Wall Street firms this Friday morning with more than two hours until the open.

  • Arm Holdings (ARMH) Raised to Buy at Goldman Sachs.
  • Biomarin Pharma (BMRN) Raised to Buy at Citigroup.
  • Cyberonics (CYBX) Raised to Buy at PiperJaffray
  • F5 Networks (FFIV) Started as Outperform at William Blair.
  • Gap Inc. (GPS) Raised to Buy at Citigroup.
  • Juniper Networks (JNPR) Started as Outperform at William Blair.
  • Limited (LTD)  Raised to Buy at Citigroup.
  • Microsoft (MSFT) Raised to Outperform at Oppenheimer.
  • Myriad Genetics (MYGN) Raised to Buy at Citigroup.
  • Novatel Wireless (NVTL) Raised to Neutral from Sell at Piper Jaffray.
  • Salesforce.com (CRM) Raised to Outperform at Baird.

Jon C. Ogg
November 21, 2008

Posted on: November 21, 2008 – 7:33 am in Analyst Calls, , , , , , , , , , ,

A Pre-Packaged Bankruptcy For GM (GM)? Begging For A UAW Strike

Gm20jpeg20imageBloomberg is reporting that the new administration may push for a pre-packed bankruptcy for GM (GM).

"President-Elect Barack Obama’s transition team is exploring a swift, prepackaged bankruptcy for automakers as a possible solution to the industry’s financial crisis, according to a person familiar with the matter."

In a prepackaged bankruptcy, an automaker would go into court with financing in hand after reaching agreement with lenders, workers and suppliers on what each would give up and on the business plan to be followed. The process might take 6 to 12 months, compared with two to five years if the automakers followed an ordinary Chapter 11 proceeding."

Since the UAW would have a great deal to lose from this, watch for a massive strike if the government tries to get it through. It will be the only leverage the union will have.

Douglas A. McIntyre

Posted on: November 21, 2008 – 7:33 am in Autos,

Top Pre-Market Analyst Downgrades (ADSK, BEAV, CPSI, DELL, GPRO, GR, GOOG, JASO, CSIQ, ORCL, SPR, STP, VMW)

Down_arrow_redThese are the top analyst downgrades and negative analyst calls we are seeing this Friday morning:

  • Autodesk (ADSK) Cut to Neutral at Baird.
  • BE Aerospace (BEAV) Cut To Market Perform at FBR.
  • Computer Programs & Systems (CPSI) Cut to Market Perform at William Blair.
  • Dell (DELL) Cut to Market Perform at FBR.
  • Gen-Probe (GPRO) Cut to Equal Weight at Morgan Stanley.
  • Goodrich (GR) Cut To Market Perform at FBR.
  • Google (GOOG) Started as Sell at Merriman Curhan Ford.
  • JA Solar (JASO) Cut to Perform at Oppenheimer.
  • Canadian Solar (CSIQ) Cut to Perform at Oppenheimer.
  • Oracle (ORCL) Cut to Perform at Oppenheimer.
  • Spirit AeroSystems (SPR) Cut To Market Perform at FBR.
  • Suntech Power (STP) Cut to Perform at Oppenheimer.
  • VMware (VMW) Cut to Sell at UBS.

Jon C. Ogg
November 21, 2008

Posted on: November 21, 2008 – 7:25 am in Analyst Calls, , , , , , , , , , , , ,

Verizon (VZ) Gets It Own Apple (AAPL) iPhone

Steve_jobsIt must vex the Verizon (VZ) management that AT&T (T) has the nifty Apple (AAPL) iPhone and all the publicity and surging handset sales that go with it. AT&T even benefits when people who cannot afford the smartphone stop into its shops and leave with something cheaper.

Now, Verizon will try to get its revenge with a new super-phone from RIM (RIMM), the Blackberry Storm. The name is so dynamic that it is hard to believe something which can be put into a pocket could be that perfect and powerful.

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Posted on: November 21, 2008 – 6:23 am in Telecom, , , ,

Rallying Back From The Depths Of Hell

Cammonopoly_wideweb__430x3250The market has to rally something, and this is as good as any. The DJIA has fallen from 13,850 less than a year ago to 7,552. The idea that Citigroup (C) may be for sale could take its potential failure off the table. Congress appears ready to capitulate and give car companies money that they can pile up in the streets of Detroit and burn.

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Posted on: November 21, 2008 – 6:09 am in Economy,

Farmers Face Down Deflation As Tractors Get Rusty

95129c_2Farmers are supposed to be frugal and that characteristic may serve them well. After getting fat and happy off high agricultural goods prices, they get to be on the poor end of commodities deflation.

It is just their luck that as they are bringing in record crops, buying extra seed, planting more land, and getting new tractors, that the need for their corn and wheat has fallen.

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Posted on: November 21, 2008 – 5:50 am in Agriculture

As Corporate IT Spending Drop Apple (AAPL) And RIM (RIMM) Hold On

IphoneCorporate IT spending has driven off a cliff. No one should be surprised. The recession has cut into corporate revenue. Many companies are faced with cutting people or upgrading hardware and other services.

Most firms will elect to keep personnel, if they can, and dump the plan for new electronics

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Posted on: November 21, 2008 – 5:30 am in Consumer Electronics,