15 – January – 2009 – 24/7 Wall St.

Daily Archives: January 15, 2009

Intel Sets Precedent For No Guidance In Tech (NASDAQ: INTC)

Intel Corporation (NASDAQ: INTC) just posted earnings of $0.04 in non-GAAP EPS and $8.23 billion inrevenue. Thomson Reuters (First Call) had estimates at $0.04 non-GAAPEPS and $8.21 billion in revenue. The company had warned recently that sales would be roughly $8.2 billion. What is more important is itsdiscussion ahead.

Posted on: January 15, 2009 – 4:23 pm in Earnings, Semiconductor, Technology Companies, INTC

The 52-Week Low Club (BAC)(RF)(USB)(SSCC)

Bank Of America (BAC) Needs a bigger government bailout. Drops to $7.35 fro 52-week high of $45.08.

Regions Financial (RF) Bad day for banks. Falls to $5.97 from 52-week high of $25.84.

US Bancorp (USB) Still moving off due to downgrade. Hit $18.70 from 52-week high of $42.23.

Smurfit-Stone (SSCC) May go bankrupt. Down almost 85% to new 52-week low of $.05. The 52-week high is $9.99.

Douglas A. McIntyre

Posted on: January 15, 2009 – 4:12 pm in HI/LOW, BAC, RF, SSCC, USB

Digging In For Dismal Intel Earnings (INTC)

Intel Corporation (NASDAQ: INTC) is set to report earnings right after the close. The company has already said the quarter would be atrocious. More than once. But there are some things which are far more important to the company. What it says during the conference call could either set the stock headed toward $10 or send shares higher by bolstering investors’ optimism.

Posted on: January 15, 2009 – 12:15 pm in Earnings, Semiconductor, Technology Companies, INTC

Was Chavez Just Joking? (CVX, STO, TOT, BP, COP, XOM)

Judged by the country’s performance in extracting hydrocarbons, Venezuela under President Hugo Chavez has not been a smashing success. Ten years ago, when Chavez first came to power, the country produced about 3.4 million barrels of oil a day. Production currently runs around 2.3 million barrels a day and is still falling. This decline makes for tough times in Venezuela. The country relies on oil for more than 90% of its export earnings and more than 60% of the government’s budget. That budget also pays for a lot more social programs now than it did ten years ago. In 2007, Venezuela essentially nationalized its oil industry, raisingroyalty payments and, in some cases, expropriating the oil companies’assets.

Chevron Corporation (NYSE:CVX), StatoilHydro ASA (NYSE:STO),Total S.A. (NYSE:TOT), and BP plc (NYSE:BP) retained minority ownershipof their assets. ConocoPhillips Corporation(NYSE:COP) wrote off morethan $4.5 billion in assets and pulled out. Exxon Mobil Corporation(NYSE:XOM) decided to fight, and about $13 billion in assets is atstill at stake, with Exxon winning the original case, but losing anappeal last year.

Posted on: January 15, 2009 – 11:54 am in Oil & Gas, Politics, BP, COP, CVX, STO, TOT, XOM

The 24/7 Wall St. Chapter 11 Watch (SIRI)(GM)(CHTR)(MNI)(F)(NYT)(BAC)(C)(MOT)(AMD)

From time to time, the editors at 24/7 Wall St. will look at which companies may file for Chapter 11 bankruptcy protection over the next year. The analysis involves looking at SEC filings with a focus on balance sheet, cash flow, and risk factors. Also taken into account are stock price, earnings forecasts, and the ability of a company to raise cash.

In the current credit environment, many firms which would not have been on the list at the middle of last year would have to be considered now. We are covering what we feel are the odds that the companies may need protection from creditors.

Posted on: January 15, 2009 – 11:08 am in Research, AMD, AMR, C, CAL, CHTR, DAL, F, INTC, LVLT, MNI, MOT, NVDA, NYT, SIRI, UAUA

Did Disney Share in Apple’s Jobs Reporting Duties? (AAPL, DIS)

By now, even the pygmies have heard that Steve Jobs is taking a medical leave of absence as CEO of Apple Inc. (NASDAQ: AAPL). Where Apple goes from here is one issue dependent upon the market conditions. Yet, shares are at a two-year low. But there is one question here that some may ask: Does Walt Disney Co. (NYSE: DIS) have any of the same responsibilities that Apple has in its disclosure over the health of Steve Jobs?

Posted on: January 15, 2009 – 10:13 am in Consumer Electronics, Management Change, Media, AAPL, DIS

Target and the Final Exit of Bob Ulrich (TGT, WMT)

Target Corporation (NYSE: TGT) announced this morning that its board of directors has appointed president and CEO Gregg Steinhafel as the company’s chairman of the board, effective February 1. Steinhafel will succeed Bob Ulrich,who was given much of the credit from 2002 to 2007 when Target did so well against Wal-Mart Stores Inc. (NYSE: WMT).

Posted on: January 15, 2009 – 9:26 am in Management Change, Retail, TGT, WMT

KeyBanc Lowers Estimates and Price Targets On Payment Processors MasterCard (MA) and Visa (V)

KeyBanc is lowering estimates and price targets for payment processors, including MasterCard (NYSE: MA) and Visa (NYSE: V). The firm said they are taking a far more cautious approach than the Street and are reducing volume and transaction assumptions virtually across the board.

Economic Data Shows Recovery More Than Elusive

This morning we had several key pieces of economic data in weekly jobless claims and in the ever-important reading of wholesale inflation measured via the producer price index. Interestingly enough, the NY Fed manufacturing data showed an improvement. Or at least it was less-bad.

Posted on: January 15, 2009 – 8:43 am in Economy

Government Solutions Are Slowing the Economy

By John Tamny RealClearMarkets

A recent newspaper headline asked a question that’s presently on the minds of many Americans: "How long will the economic plunge go on?" Depending on the person answering the question, one might among other things hear "when taxes are reduced" or "when housing recovers." Both answers are surely appealing, but then it’s also true that the U.S. economy has boomed with tax rates much higher than those at present, not to mention that even in its weakened state, prices today point to a housing market better than the one Americans experienced when this decade began.

Perhaps a better question to ask might be what the federal government is doing right now to make the economy worse, or what the government could stop doing so that the economy starts growing again. In this case, the answers to our present economic difficulties are many.

Societe Generale Analyst Calls For Depression

The French has turned to a trait which has been uncommon in the European country.

One of the most well-regarded analysts at Societe Generale says that it is time for the US to gird for a depression. The notion that the economy might recover is useless.

Posted on: January 15, 2009 – 7:59 am in Economy

Top Pre-Market Analyst Upgrades (ABC, DLTR, ECL, MOT, PRSP)

These are some of the top pre-market analyst upgrades we have seen this Thursday morning with more than two hours until the market opens:

AmerisourceBergen (ABC) Raised to Outperform at Oppenheimer.
Dollar Tree (DLTR) Raised to Neutral at Goldman Sachs.
Ecolab (ECL) Raised to Outperform at Baird.
Motorola (MOT) Raised to Overweight at JPMorgan.
Prosperity Bancshares (PRSP) Raised to Buy at SunTrust.

Jon C. Ogg
January 15, 2009

Posted on: January 15, 2009 – 7:42 am in Analyst Calls, ABC, DLTR, ECL, MOT, PRSP

Top Pre-Market Analyst Downgrades (AEG, AAPL, BHP, CSIQ, CWST, JASO, MTB, NT, RRGB, STP, TRMB, WMI)

These are some of the top pre-market analyst downgrades we have seen this Thursday morning with more than two hours until the market opens:

Aegon (AEG) Cut to Sell at UBS.
Apple (AAPL) Cut to Underperform at RBC.
BHP Billiton (BHP) Cut to Neutral at Credit Suisse.
Canadian Solar (CSIQ) Cut to Neutral at Broadpoint AmTech.
Casella Waste Systems (CWST) Cut to Neutral at JPMorgan.
JA Solar (JASO) Cut to Neutral at Broadpoint AmTech.
M&T Bank (MTB) Started as Underperform at FBR.
Nortel (NT) Cut to Underperform at CIBC.
Red Robin Gourmet (RRGB) Cut to Neutral at Piper Jaffray.
Suntech Power (STP) Cut to Neutral at Broadpoint AmTech.
Trimble Navigation (TRMB) Cut to Underweight at JPMorgan.
Waste Management (WMI) Cut to Neutral at JPMorgan.

Jon C. Ogg
January 15, 2009

Posted on: January 15, 2009 – 7:39 am in Analyst Calls, AAPL, AEG, BHP, CSIQ, CWST, JASO, MTB, NT, RRGB, STP, TRMB, WMI

JP Morgan (JPM) Holds The Line For The Banking Industry, Again

Analysts have been concerned that JP Morgan (JPM), considered the most successful of the large US banks, might miss its numbers and turn in a loss

The financial firm held the line and left some hope that the entire industry may not fall into another chaotic and destructive round of losses and government rescues.

Posted on: January 15, 2009 – 6:50 am in Earnings, BAC, C, JPM

Sales Of The PC, The Automobile Of The 21st Century, Fall On Hard Times

During the last half of the 20th Century every family wanted to have a car, and most bought one.. In many cases they got two or three. The automobile was a status symbol, and a symbol of freedom, that was more than matched by its utility.

Some time around the 1970s, the car business had its first unimaginable crisis due to big cars and expensive gas. Since those car companies didn’t learn anything from that experience, there have been episodic auto sector crises since then. And the whole world knows now what this inability to learn from their mistakes has done to the car companies.

Posted on: January 15, 2009 – 6:31 am in PC Companies, DELL

The Ominous Sign Of Laying Off People At Profitable Companies (DELL)(MSFT)(GOOG)(MOT)

Motorola (MOT) will lay off 4,000 more people this year. In the fourth quarter, it sold only half as many handsets as it did in the same quarter a year ago. The decision makes sense even if it is gutting the company. Motorola may not be able to stay in business beyond the middle of the year.

The other news about jobs cuts in the last day is that many are happening at companies which are profitable, and, in some cases, remarkably successful.

Posted on: January 15, 2009 – 6:13 am in Economy, DELL, GOOG, MOT, MSFT

Bank Of America (BAC) And The Incredible Disappearing TARP

Congress is fighting with both the administration that is leaving and the one that is coming about what should happen to the $350 billion left in the TARP. Most legislators do not seem to be happy about how Treasury Secretary Henry Paulson spent the first $350 billion. Too much of it got invested in banks and car companies. Not enough went to help mortgage holders.

Whether it is practical to help people with troubled home loans one-by-one may be beside the point. The fight over the TARP will be vicious. Saying that taxpayers will get their money back by saving the housing market probably creates good will politically.

Posted on: January 15, 2009 – 5:55 am in Banking, BAC, C

Steve Jobs: “The Deviant’s Advantage” (AAPL)

Sunset_2 Sociologist and business consultant Watts Wacker has pointed out that the most successful enterprises in the world are created by people who are willing to be a zebra in a field of horses. His rather rough way of describing this is "the deviant’s advantage." Steve Jobs has had that advantage throughout his business career.

The longest shot Jobs ever took may have been to launch the Macintosh in 1984 into a world that would be dominated by the PC. The competition from the more popular format eventually cost him his job as the head of Apple (AAPL). He simply left and created Next and Pixar. When things got worse at Apple, he was asked to run Apple again.

Posted on: January 15, 2009 – 5:34 am in Management Change, AAPL, NOK, RIMM, WMT

Media Digest 1/15/2009 Reuters, WSJ, NYTimes, FT, Bloomberg

According to Reuters, Steve Jobs will take a medical leave from Apple (AAPL) until June 30.

Reuters reports that Bank of America (BAC) is in discussions with the government to get billions of extra dollars.

Reuters reports that Western banks may regret rushing out of China.

Posted on: January 15, 2009 – 3:52 am in Press Digest, AAPL, BAC, C, DB, DELL, GCI, GS, IBM, JPM, LLY, MOT, MSFT, TIF, YHOO

Asia Markets And Europe Open 1/15/2009

Markets in Asia were sharply lower.

THe Nikkei fell 4.9% to 8,023.

The Hang Seng was off 3.4% to 13,235.

The Shanghai Composite fell .5% to 1,920.

At the open in Europe, the FTSE was up .2% to 4,190. The DAX was higher by .3% to 4,436 and the CAC 40 was up .3% to 3,052.

Data from MarketWatch and Reuters.