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It seems that the newspaper industry changes are not going to slow down any time soon. An ominous announcement came across Business Wire today saying Hearst Corporation intends to jettison the Seattle Post-Intelligencer and its interest in the Joint Operating Agreement under which the P-I and The Seattle Times are published. Hearst has retained newspaper industry investment bankers Broadwater & Associates of New York to search for a buyer.
Daily Archives: January 9, 2009
Hearst To Dump Seattle P-I
Rubin Out At Citi (C)
The WSJ first reported that famed ex-Treasury Secretary Bob Rubin will be leaving the board of directors at Citigroup Inc. (NYSE: C). This has now been confirmed in multiple reports elsewhere. This follows about two years worth of criticism, the ouster of Chuck Prince and the questionable performance of Vikram Pandi. Some have argued that Rubin has just not been worth anything to Citigroup.
Counter-Cycle Upgrades in YRC Worldwide (YRCW)
The business of trucking and transporting goods has not been a stellar for quite some time. In 2007 to 2008, the sector was hurt by escalating gas prices and an inability to pass on fuel surcharges until it was too late. Now it has to deal with an economy in the tubes where less stuff gets shipped. So it might seem odd that a debt ratings agency would raise YRC Worldwide Inc. (NASDAQ: YRCW). It might also seem odd that a Wall Street analyst would take a positive call on it.
More Nukes in the Pipeline (CEG, PPL, EXC)
UniStar Nuclear Energy, a joint venture between Electricite de France (EDF) and Constellation Energy Group Inc. (NYSE:CEG), and PPL Corporation (NYSE:PPL), a UniStar partner, have passed the first regulatory review on the road to building four new nuclear power plants. The US Nuclear Regulatory Commission just added the fourth, a plant near Berwick, Pennsylvania, to its docket of combined license applications for new nukes.
Boeing Goes Boing Boing With Pink Slips (BA)
Boeing Co. (NYSE: BA) has decided that it wanted to get into the business of pink slips. The aerospace and defense giant announced that it plans to shed some 4,500 workers. The cuts are coming in its commercial airplanes unit and according to the company will take it back to levels of earlier a year ago. Boeing did note that attrition and reduced contract labor account forsome of the reductions. But some layoffs will be necessary, and mostof the cuts will come in the second quarter.
Rig Counts Fall in December (BHI)
Baker Hughes Incorporated (NYSE:BHI) released its monthly rig count report this morning. Compared with November counts, drilling rigs in North America are off about 9%. Compared with December 2007, North American rigs are down by just 28, about 1%.
A Big Writedown At Macy’s (M)? A Question Of Who Is Next
It is beginning to dawn on Wall St. that jobs are not the only thing that retailers will be cutting. The value of their stores, inventories, and any past M&A deals may be on the line.
According to Bloomberg, "The second-largest U.S. department-store company may write down its goodwill by as much as $3 billion after-tax as early as this month, said Dan Poole, who researches stocks for National City Private Client Group." Part of the action would be due to the value of May Department Store assets. Macy’s bought the chain three years ago.
More Layoffs Coming in the Oil Patch (CVX, SLB, XOM, COP, BP)
Chevron Corporation (NYSE:CVX) already gave its severe earnings warning and we have already seen layoffs coming out of Schlumberger Limited (NYSE: SLB). [] and its dragging down share prices for the other oil majors. Interestingly, Chevron has bounced back a little, as has Exxon Mobil Corporation (NYSE:XOM), but ConocoPhillips Corporation (NYSE:COP) and BP plc (NYSE:BP) continue lower.
Nordstrom Gets New Largest Shareholder (JWN)
It looks like Nordstrom Inc. (NYSE: JWN) has a new largest shareholder. An existing holder called Capital World Investors has increased its ownership in the upscale retailer and now owns a 10.1% stake in the company with 21,813,100 shares of common stock.
Recession Fallout: Layoffs in Wrestling (WWE)
As if you would not have guessed, wrestling is apparently not a recession-proof business. This morning there was an announcement from World Wrestling Entertainment Inc. (NYSE: WWE) that it was "restructuring," which is the new lingo for job cuts and cost cuts.
Morgan Joseph Upgrades Palm (PALM) to Buy On The New Pre
Morgan Joseph upgrades Palm (NASDAQ: PALM) to Buy with a $6.50 price target, following the intro of the Palm Pre.
The firm said, "Yesterday, Palm introduced what we believe is an attractive and long-awaited Smartphone, and a new OS. Dubbed the "Palm Pre", the device is fully equipped with a touch screen, slide-out keyboard, 8 Gb of memory, and music download capabilities, among other features. We were equally impressed with Palm’s new OS, called "Palm webOS." Palm webOS offers full integration of information from web-based applications such as Facebook, Outlook, and Google and the ability to present the information in an organized view on the phone.
Russia, Ukraine, Europe.. Good Cop, Bad Cop
It seems that the odd nature of natural gas supplies to Europe from Russia may be taking a turn toward normalcy. At least whatever that means in Russia and anyone dealing with it. Platts is reporting this morning that Russian Prime Minister Vladimir Putin and Czech Prime Minister, and current president of the European Union, Mirek Topolanek have agreed to put international observers at gas metering stations on the Russia-Ukraine border. Ukraine has not yet agreed to the observers.
7.2% Unemployment Will Only Get Worse From Here
It seems that Donald Trump is in charge everywhere if you look at the most recent data from the Labor Department: everyone is fired. Today’s report could have gone much differently. It isn’t that the unemployment rate and that the loss of non-farm payrolls in unimportant. But….
The Horrible Jobs Report May Save The Economy
By most estimates the report on December unemployment could hardly have been worse. Many experts believe that 500,000 jobs would be lost and that unemployment would rise to 7%. The actual figures came in at 524,000 and 7.2%.
But, the disaster may be in large part what saves the economy.
The great enemy of stopping the frightful fall in employment, the catastrophe of corporate earnings, and the plunging housing market is that time is not on the government’s side. That is an observation which has almost been made too often.
KB Home & Dr. Pangloss (KBH)
KB Home (NYSE: KBH) and the housing sector is far from out of the woods. Even if you pretend your name is Dr. Pangloss it is hard to find some decent data among the malaise here. But when you consider just how poor the economy and the consumer is today. It might not be a total head-scratcher as to why shares are not in free fall all over again.
Best Buy (BBY) Craters, Market Yawns
No one is his right mind is likely to be happy with the Best Buy (BBY) numbers for December. Same-store sales dropped 6.5%. Sales rose a modest 4% to $7.5 billion.
The figures were an example of just how bad the retail environment is and Best Buy is considered on of the best-run chains in America.
BBY’s US-based operations generated $5.9 billion in revenue for fiscal December, which was nearly unchanged compared with last year’s period.. Unlike Wal-Mart (WMT), Best Buy did well overseas. The company’s international segment increased its fiscal December revenue by 29 percent to $1.6 billion.
Even though the numbers were bad, the market must have expected worse. BBY shares were up a fraction to $29.90 in pre-market trading.
Douglas A. McIntyre
Top Pre-Market Analyst Upgrades (MDRX, BDX, ED, CRXL, CSX, RTN, SGR, SNN)
These are the early bird upgrades and positive analyst calls we have seen from Wall Street this Friday morning:
- Allscripts-Misys (NASDAQ: MDRX) Raised to Outperform at William Blair.
- Becton Dickinson (NYSE: BDX) Raised to Overweight at Morgan Stanley.
- Consolidated Edison (NYSE: ED) Raised to Buy at Citigroup.
- Crucell (NASDAQ: CRXL) Raised to Buy at RBS.
- CSX (NYSE: CSX) Raised to Buy at Deutsche Bank.
- Raytheon (NYSE: RTN) Raised to Buy at Goldman Sachs.
- Shaw Group (NYSE: SGR) Cut to Hold at Citigroup.
- Smith & Nephew (NYSE: SNN) Raised to Neutral at JPMorgan.
Jon C. Ogg
January 9, 2009
Top Pre-Market Analyst Downgrades (ALU, BRLI, GPS, GD, PCK, PSO, PAS, PTR, PKX, RTP, COL, WXS)
The rate of downgrades versus upgrades is still coming out with a much more negative bias from Wall Street. These are some of the downgrades and negative research calls we have seen from Wall Street analysts this Friday morning:
- Alcatel-Lucent (NYSE: ALU) Cut to Equal Weight at Morgan Stanley.
- Bio-Reference Labs (NASDAQ: BRLI) Cut to Perform at Oppenheimer.
- Gap Inc. (NYSE: GPS) Cut to Hold at Citigroup.
- General Dynamics (NYSE: GD) Cut to Neutral at Goldman Sachs.
- Patriot Coal (NYSE: PCX) Started as Sell at Citigroup.
- Pearson (NYSE: PSO) Cut to Sell at Goldman Sachs.
- PepsiAmericas (PAS) Cut to Sell at Goldman Sachs.
- PetroChina (NYSE: PTR) Cut to Neutral at JPMorgan.
- Posco (NYSE: PKX) Cut to Neutral at Goldman Sachs.
- Rio Tinto (NYSE: RTP) Cut to Hold at Deutsche Bank.
- Rockwell Collins (NYSE: COL) Cut to Sell at Goldman Sachs.
- Wright Express Corp. (NYSE: WXS) Cut to Neutral at JPMorgan.
Jon C. Ogg
January 9, 2009
Why Madoff Doesn’t Matter
A rough count would show that something like a quarter of the business coverage at most financial websites and in the financial sections of newspapers is devoted to the Bernie Madoff matter. The old man did walk off with what is said to be $50 billion of other people’s money. It is endlessly fascinating to figure out how it was done and why it went undetected for so long.
It would be difficult to find something more pleasurable that excoriating the public officials who did not catch on to Madoff’s activities even though a number of people questioned his methods long ago.
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