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Top Analyst Upgrades & Downgrades (APA, BBT, CVC, CHK, DRI, EMN, EW, MRO, NBL, PEET, RIMM, RBS, SLM, URBN)

Administrator — Fri, 03 Feb 2012 13:07:02 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street brokerage and research firms this Friday morning.

Apache Corporation (NYSE: APA) Started as Outperform at Credit Suisse.
BB&T Corp. (NYSE: BBT) Raised to Equal-Weight at Barclays.
Cablevision Systems Corporation (NYSE: CVC) Cut to Underweight at JPMorgan.
Chesapeake Energy Corporation (NYSE: CHK) Started as Neutral at Credit Suisse.
Darden Restaurants, Inc. (NYSE: DRI) named Bear of the Day at Zacks.
Eastman Chemical Company (NYSE: EMN) named as Value stock of the day at Zacks.
Edwards Lifesciences Corporation (NYSE: EW) Cut to Market Perform at Wells Fargo.
Marathon Oil Corporation (NYSE: MRO) Cut to Hold at Argus.
Noble Energy Inc. (NYSE: NBL) Started as Outperform at Credit Suisse.
Peet’s Coffee & Tea, Inc. (NASDAQ: PEET) Raised to Outperform at Baird.
Research in Motion Ltd. (NASDAQ: RIMM) Cut to Underperform at Jefferies.
Royal Bank of Scotland (NYSE: RBS) Cut to Hold at Deutsche Bank.
SLM Corp. (NYSE: SLM) named as Bull of the Day at Zacks.
Urban Outfitters, Inc. (NASDAQ: URBN) Raised to Buy from Neutral at Janney Capital.

If you enjoyed the top analyst calls, you can sign up in the box below to join our morning email list to receive news directly in your inbox each morning. We include major analyst upgrades and downgrades, IPO and M&A news, special situation developments, observations on Warren Buffett and key market gurus, as well as special exclusive feature stories.

JON C. OGG

Filed under: 24/7 Wall St. Wire, Analyst Calls Tagged: APA, BBT, CHK, CVC, DRI, EMN, EW, MRO, NBL, PEET, RBS, RIMM, SLM, URBN

Beyond Stress Tests: Banks Reach Ridiculous Discounts To Book Value (JPM, BAC, C, WFC, BBT, BK, COF, FITB, GS, MS, JEF, PNC, STI)

Administrator — Wed, 23 Nov 2011 13:29:01 +0000

The new proposed stress tests are just one more thorn in the side for the banking sector, but analysts from Dick Bove to Meredith Whitney, as well as value and bargain investors and short-selling hedge funds, routinely have an opinion on the banking sector and on individual banks almost daily. Some are good, some are just awful. It seems amazing on the surface if you just look at the screens of the largest banks trading at or under book value. Unfortunately, that implied book value for the foreseeable future is going to be a cap rather than a floor as the market tries to digest the real long-term earnings power being far lower ahead. The trick in evaluating book value is avoiding the obvious value traps.

It still feels as though calculating a bank’s book value is a bit like calculating the cash per share of an emerging biotech that just experienced an implosion due to a poor drug candidate’s test result. The value may be eroded through time. Now that earnings season has passed. 24/7 Wall St. has run a screen of the money-center banks, large broker-dealers, and super-regional banks trading at or under book value from the last quarter under the FinViz screen.

J.P. Morgan Chase & Co. (NYSE: JPM) now trades around $25.30 and its October earning’s book value was listed as $45.93 per share, up from $44.77 one quarter earlier and versus $42.29 a year earlier.

Bank of America Corporation (NYSE: BAC) is almost embarrassing, or actually it is embarrassing. After a 2% drop to $5.36 today, BofA’s tangible book value per share in October was $13.22 versus $12.91 a year earlier and compared to $12.65 in the second quarter. The stated book value per share was $20.80 in the third quarter, down from $21.17 a year earlier and up from $20.29 in the second quarter of 2011.

Citigroup, Inc. (NYSE: C) is another large discount to book value and the $24.60 price compared to a stated book value $60.56 per share and a tangible book value per share of$49.50.

Wells Fargo & Company (NYSE: WFC), Warren Buffett’s favorite bank, used to trade at a premium to book value but that now trades at 0.93-times its most recently stated book value.

A screen at FinViz gave some key banks that are large and well-known institutions, some of which have no exposure to Europe and/or the PIIGS to speak of, which are trading at a discount to their stated book value. Others screened from FinViz are as follows, and these banks are all expected to be profitable on an operations basis ahead:

The trust and fiduciary banks are also at discounts. BB&T Corp. (NYSE: BBT) trades at 0.88-times its latest book value. The Bank of New York Mellon Corporation (NYSE: BK) trades at 0.66-times its latest book value.

Other regional and large banking outfits are at large discounts too… Capital One Financial Corp. (NYSE: COF) trades at 0.64-times its latest book value. Fifth Third Bancorp (NYSE: FITB) trades at 0.81-times its latest book value. The Goldman Sachs Group, Inc. (NYSE: GS) trades at 0.64-times its latest book value. Morgan Stanley (NYSE: MS) trades at 0.64-times its latest book value. Jefferies Group, Inc. (NYSE: JEF) is just about to have a quarter-end but it trades at 0.64-times its latest book value. PNC Financial Services Group Inc. (NYSE: PNC) trades at 0.78-times its latest book value. SunTrust Banks, Inc. (NYSE: STI) trades at 0.47-times its latest book value.

As a reminder, our take is that even if the market were to suddenly recover, tangible book values would be the first line to watch and stated book value would be much later after that. The book value game is one that looks and feels shockingly cheap today because the sector’s earnings power is being challenged each and every day. Until the climate moves beyond winding down prop-trading, not going for many loans, not being able to earn money in the short-term and intermediate-term fixed income markets, and a climate where these are sued over and over for actions of yesteryear and with the regulators running the banks.

Value investors and investors screening for “cheap stocks” still need to look elsewhere, unless they know how to model worst case scenarios for about a year or two out from today or if they think they can quantify the regulatory, legal, and operating restriction-adjusted earnings ahead.

JON C. OGG

Filed under: Banking, Bankruptcy, Brokerage Firms, Financial Stocks, Value Investing Tagged: BAC, BBT, BK, C, COF, FITB, GS, JEF, JPM, MS, PNC, STI, WFC

Earnings Hat Trick: Ignore Bank Book Values (JPM, BAC, C, WFC, GS, MS, BBT, BK, COF, FITB, PNC, STI)

Administrator — Wed, 12 Oct 2011 16:09:39 +0000

You hear it all the time… “This bank is so cheap against book value that it cannot go lower.” Book value, and even tangible book value, has become a pre-recession metric that just does not matter in the current banking climate. In many cases, calculating a bank’s book value can be a bit like calculating the cash per share of an emerging biotech that just experienced an implosion due to a poor drug candidate’s test result.

J.P. Morgan Chase & Co. (NYSE: JPM) will lead off the banks as far as earnings season. It is likely that book value here grew or did not fall much and we will be paying attention to Jamie Dimon’s comments on how his internal customers’ credit metrics came out in Q3. Jamie Dimon showed that book value was listed as $44.77 versus $43.34 the first quarter and versus $40.99 a year earlier. If Chase is the best quality of the money-center banks that there is, then a $33 handle today generates close to 0.75-times book value.

Bank of America Corporation (NYSE: BAC) noted in July that tangible book value per share was $12.65, down from $13.21 in the first quarter of 2011 and up from $12.14 in the second quarter of 2010. Its stated book value per share was listed as $20.29 as of June 30, down from $21.15 in the first quarter and down from $21.45 in the same period of 2010. Shares are trading under $6.50 today. The trick is not that Bank of America is lying about the book value today. We think that the number was actually true based upon a snapshot in time, but the issue is that the street cannot figure out how to model its mortgage exposure and lawsuit exposure and what that does to the book value a year or two out. What if regulators move to press for a break-up of if the company remains under pressure for the long-haul. What if they keep losing customers over the $5.00 fee for using debit cards for buying goods. Also, Bank of America is expected to have a loss this quarter and its charges and other issues have likely continued to pressure the book value metrics. What is there to say about the likely direction of the book value for the foreseeable future.

We ran a screen of banks trading at or under book value from the last quarter under the FinViz screen. Book value should be considered a ceiling rather than a floor for the time being. Ultimately that will change, but we live in a climate where banks are winding down prop-trading, not going for many loans, are not able to earn money in the short-term and intermediate-term fixed income markets, being sued over and over for actions of yesteryear, are under more and more regulation, and more. There is just no real good news that is evident yet and shareholders are going to not care about book value any time soon.

A screen at FinViz gave some key banks valued at over $10 billion and trading under book value, and that is generally the stated book value rather than the tangible book value. We would note that the price changes of the shares may alter these numbers slightly as the prices move up and down into and during earnings season. We have also included earnings estimates for the quarter from Thomson Reuters to show which banks have a shot at higher book value rather than the banks losing money:

BB&T Corp. (NYSE: BBT) trades at 0.92-times its latest book value. Earnings estimates for the quarter are $0.49 EPS.

The Bank of New York Mellon Corporation (NYSE: BK) trades at 0.69-times its latest book value. Earnings estimates for the quarter are $0.53 EPS.

Citigroup, Inc. (NYSE: C) trades at 0.46-times its latest book value. Earnings estimates for the quarter are $0.84 EPS.

Capital One Financial Corp. (NYSE: COF) trades at 0.68-times its latest book value. This one is in the midst of digesting additional purchases so tallying up a relevant book value may be a couple of quarters out. Earnings estimates for the quarter are $1.68 EPS.

Fifth Third Bancorp (NYSE: FITB) trades at 0.80-times its latest book value. Earnings estimates for the quarter are $0.33 EPS.

The Goldman Sachs Group, Inc. (NYSE: GS) trades at 0.68-times its latest book value. Earnings estimates for the quarter are $0.37 EPS.

Morgan Stanley (NYSE: MS) trades at 0.50-times its latest book value. Earnings estimates for the quarter are $0.34 EPS.

PNC Financial Services Group Inc. (NYSE: PNC) trades at 0.81-times its latest book value. Earnings estimates for the quarter are $1.49 EPS.

SunTrust Banks, Inc. (NYSE: STI) trades at 0.51-times its latest book value. Earnings estimates for the quarter are $0.35 EPS.

As a reminder, earnings from operations do not assure that any growth will have been seen in stated book value nor in tangible book value.

******

An exception to the rule: Wells Fargo & Company (WFC) at 1.01-times its most recently stated book value. Wells Fargo is around $27.00 now, although the book value per share was listed as $23.84 in its July earnings report. Earnings estimates for the quarter are $0.72 EPS.

Until Wall Street investors can figure out where these banks are going to make their profits and until Main Street and state and federal agencies stop putting severe pressure on the banks, what good is book value? Book value is current a ceiling rather than a floor.

Value investors and investors screening for “cheap stocks” still need to look elsewhere, unless they know how to model worst case scenarios for about a year or two out from today.

JON C. OGG

Filed under: Banking, Earnings, Earnings Warning, Financial Stocks, Value Investing Tagged: BAC, BBT, BK, C, COF, FITB, GS, JPM, MS, PNC, STI, WFC

Top Analyst Upgrades & Downgrades (AER, AYR, BBY, BBT, CMG, CREE, HPQ, JDSU, LDK, LOGI, LULU, RIMM, SHLD, SINA, SU, TSO, VRSK)

Administrator — Fri, 19 Aug 2011 12:24:27 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Friday morning.

AerCap Holdings N.V. (NYSE: AER) Started as Outperform with $16 target at Credit Suisse.
AirCastle LTD (NYSE: AYR) Started as Neutral with $14 target at Credit Suisse.
Best Buy Co., Inc. (NYSE: BBY) Raised to BUy at S&P Equity Research (late Thursday).
BB&T Corporation (NYSE: BBT) Started as Hold at Citigroup.
Chipotle Mexican Grill, Inc. (NYSE: CMG) Raised to Outperform at Morgan Keegan.
Cree Inc. (NASDAQ: CREE) Cut to Market Perform at JMP.
Hewlett-Packard Co. (NYSE: HPQ) Cut to Neutral at UBS; Cut to Neutral at Baird.
JDS Uniphase Corporation (NASDAQ: JDSU) Maintained Buy but cut target to $17 at Argus.
LDK Solar Co., Ltd. (NYSE: LDK) cut to Neutral at Piper Jaffray.
Logitech International (NASDAQ: LOGI) Cut to Underperform as Bear of the Day at Zacks.
Lululemon Athletica Inc. (NASDAQ: LULU) Raised to Equal-Weight at Barclays.
Research in Motion Ltd. (NASDAQ: RIMM) Raised to Hold from Underperform at Jefferies.
Sears Holdings Corp. (NASDAQ: SHLD) Maintained Hold at Argus.
Sina Corporation (NASDAQ: SINA) Cut to Neutral at Credit Suisse.
Suncor Energy INc. (NYSE: SU) Raised to Buy at BofA/ML.
Tesoro Corporation (NYSE: TSO) Maintained Outperform as Bull of the Day at Zacks.
Verisk Analytics, Inc. (NASDAQ: VRSK) Raised to Outperform at KBW.

You are invited to join our free daily email distribution list to hear more about analyst upgrades and downgrades, top day trader and active trader alerts, dividend trends, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Filed under: Analyst Calls Tagged: AER, AYR, BBT, BBY, CMG, CREE, HPQ, JDSU, LDK, LOGI, LULU, RIMM, SHLD, SINA, SU, TSO, VRSK

The Return of Bank Dividends (JPM, WFC, USB, BBT, PNC, BK, STT, GS, BRK-A)

Administrator — Fri, 18 Mar 2011 16:52:57 +0000

The economy and investment categories may both be normalizing again, but dividend investors will get to start looking at banks again. Today was D-Day for Dividend Day as the Federal Reserve is freeing up the healthy banks to begin reinstating dividends. So far we are seeing dividend announcements from the likes of JPMorgan Chase & Co. (NYSE: JPM), U.S. Bancorp (NYSE: USB), Wells Fargo & Company (NYSE: WFC), and BB&T Corp (NYSE: BBT).

JPMorgan Chase & Co. (NYSE: JPM) declared a quarterly dividend of $0.25 per share, up from $0.05 after the banks had to cut payouts during the meltdown. The company also authorized a new $15 billion multi-year common stock repurchase program, but $8 billion was approved for 2011 alone and tha represents about 175 million shares in today’s dollars. The share repurchase program replaces the prior $10 billion program that had approximately $3.2 billion of remaining authorization. Jamie Dimon is signaling that more hikes may come later… he have a 30% income payout ratio as his goal. He also noted that its objectives of maintaining a Basel I Tier 1 Common ratio of at least 9.0% and meeting the Basel III requirements were substantially achieved ahead of time. The new yield is close to 2.2%.

U.S. Bancorp (NYSE: USB) hiked its payout by 150% and will now pay $0.125 per common share per quarter and it approved for repurchase some 50 million shares of common stock. The new dividend yield is approximately 1.8%.

Wells Fargo & Company (NYSE: WFC) is also targeting a 30% income payout ratio and is hiking the payouts to $0.12 per common share per quarter from $0.05 previously. Wells Fargo is also increasing its share buyback authority by some 200 million shares of common stock. Now it won’t just be Warren Buffett increasing the Wells Fargo share buying. The new payout to Warren Buffett and investors will be roughly a 1.5% dividend yield.

BB&T Corp. (NYSE: BBT) hiked is payout with a $0.01 special dividend and took the rate to $0.16 ahead from $0.15 per share per quarter. This represents a mere 6.7% hike, which is probably not as large of dividend news noted above.

The PNC Financial Services Group, Inc. (NYSE: PNC) hiked its dividend practice but without formality. It said that “the Board of Governors of the Federal Reserve System accepted its capital plan and did not object to its capital actions, which included recommendations to increase the quarterly common stock dividend in the second quarter of 2011 and to purchase shares under PNC’s existing common stock repurchase program.” PNC submitted the plan in January and it expects to consider an increase in the common stock dividend at its next meeting on April 7, 2011.

We have noted before that we expect the same sort of dividend hikes from The Bank of New York Mellon Corporation (NYSE: BK) and State Street Corp. (NYSE: STT). Another big development we expect is a repayment of the 10% preferred shares which Goldman Sachs Group Inc. (NYSE: GS) sold to Warren Buffett at Berkshire Hathaway Inc. (NYSE: BRK-A).

If you want already-high bank yields, we just updated the highest current regional and super-regional banks that were paying common stock dividend yields of 3%, 4%, and higher.

JON C. OGG

Filed under: Banking, Dividend, Shareholder Issues, Stock Buybacks Tagged: BBT, BK, BRK-A, GS, JPM, PNC, STT, USB, WFC

Top Analyst Upgrades and Downgrades (AAPL, BBY, A, BBT, BRCM, COH, FSLR, GPS, HBAN, JBHT, JCI, KR, LULU, SWY, STI, TIF, TROW, WFMI)

Administrator — Wed, 15 Dec 2010 13:22:03 +0000

These are some of this Wednesday’s key analyst upgrades, downgrades, and initiations seen in Wall Street research calls. This morning we have two key updates from late yesterday afternoon, followed by our normal morning calls.

Apple Inc. (NASDAQ: AAPL) Maintained Outperform but removed from “Best Idea List” at Morgan Stanley (late-Tuesday call).

Best Buy Co. (NYSE: BBY) Raised to Buy at Standpoint Research on weakness; Cut to Hold at S&P Equity Research (BOTH calls are from late-Tuesday). This morning Best Buy Co. (NYSE: BBY) was Cut to Perform at Oppenheimer.

Agilent Technologies Inc. (NYSE: A) Raised to Overweight at JPMorgan.
BB&T Corporation (NYSE: BBT) Cut to Neutral at Janney.
Broadcom Corporation (NASDAQ: BRCM) Reiterated Buy and $55 target.
Coach Inc. (NYSE: COH) Started as Outperform at Credit Suisse.
First Solar, Inc. (NASDAQ: FSLR) Raised to Hold at Needham; Reiterated Buy with $167 target at Auriga.
Gap Inc. (NYSE: GPS) Started as Outperform at Credit Suisse.
Huntington Bancshares Inc. (NASDAQ: HBAN) Started as Neutral at BofA/ML.
JB Hunt Transport Services Inc. (NASDAQ: JBHT) Cut to Hold at Stifel Nicolaus.
Johnson Controls Inc. (NYSE: JCI) Started as Buy at Stifel Nicolaus.
The Kroger Company (NYSE: KR) Started as Buy at Goldman Sachs.
Lululemon Athletica Inc. (NASDAQ: LULU) Started as Outperform at Credit Suisse.
Safeway Inc. (NYSE: SWY) Started as Buy at Goldman Sachs.
SunTrust Banks, Inc. (NYSE: STI) Cut to Sell at Janney.
Tiffany & Co. (NYSE: TIF) Started as Outperform at Credit Suisse.
T. Rowe Price Group, Inc. (NASDAQ: TROW) Added to Conviction Buy List at Goldman Sachs.
Whole Foods Market, Inc. (NASDAQ: WFMI) Started as Buy with $55 target at BofA/ML; Started as Neutral at Goldman Sachs.

You can join our free daily email distribution list to hear more about dividend trends, analyst upgrades and downgrades, top day trader and active trader alerts, news on Buffett and other investment gurus, IPOs, secondary offerings, private equity, and more.

JON C. OGG

Filed under: Analyst Calls Tagged: A, AAPL, BBT, BBY, BRCM, COH, FSLR, GPS, HBAN, JBHT, JCI, KR, LULU, STI, SWY, TIF, TROW, WFMI

Major Stocks Hitting 52-Week Lows (WFC, BAC, BBT, BBY, CME, CSC, GPS, HPQ, MHS, MDT, MWW, RTN)

Administrator — Fri, 20 Aug 2010 17:28:11 +0000

There is an unbelievable number of critical stocks hitting 52-week lows this afternoon going into the options expiration date and going into the weekend. The double-dip recession fears have escalated and the risk-trade is being pulled off of the table. We have major banks, retail, tech, medical, and a defense and an exchange all breaking their 52-week lows going into the weekend. Believe it or not, short sellers, bargain hunters, and value investors alike often all look at 52-week lows in the screening.

Bankers getting their fair (or unfair) share…. Wells Fargo & Company (NYSE: WFC) is actually up a couple pennies at $24.46 today, but an intraday low of $24.27 broke under the prior 52-week trading range of $24.29 to $34.25. Bank of America Corporation (NYSE: BAC) also broke under the prior 52-week range of $13.01 to $19.86 and its new 52-week low is $12.75. BB&T Corp. (NYSE: BBT) is not a normal name for a bank stock that would be hitting 52-week lows considering that it is into trust services, yet the $22.90 price today definitely pierced the prior 52-week trading range of $23.25 to $35.72.

Best Buy Co. Inc. (NYSE: BBY) is another 52-week low club name today. If spending is shrinking and tech is getting ready for slower times, Best Buy can’t escape that. Shares traded as low as $32.05 today and the stock previously had a range of $32.49 to $48.83.

CME Group Inc. (NYSE: CME) is not a huge shock, although it is the only of the major trading exchanges that hit 52-week lows today. Maybe the insiders in Chicago are selling out before the disappear until after Labor Day. A low of $238.58 definitely took out the prior 52-week trading range of $240.00 to $353.03.

Computer Sciences Corporation (NYSE: CSC) is caught in the IT sandwich. It had no earnings, but a low print of $41.37 breached the prior 52-week trading range of $41.58 to $58.36.

Gap Inc. (NYSE: GPS) failed to make the grade with earnings and failed to hold up despite a new buyback plan and despite that it had already bought so much stock. Today’s low of $17.03 broke under the prior range of $17.38 to $26.34.

Hewlett-Packard Company (NYSE: HPQ) is not a real shock here that it is hitting lows after earnings. While the guidance was the same as two weeks ago, no one is listening and no one believes that a Hurd-less H-P can beat those annual targets. H-P hit $39.33 today and the prior range had been $39.95 to $54.75.

MedcoHealth Solutions Inc. (NYSE: MHS) was one that was supposed to be at least somewhat less sensitive to healthcare reform. Apparently not. The low of $49.90 went under the prior 52-week range of $45.15 to $66.94.

Medtronic, Inc. (NYSE: MDT) was a surprise to see on the list. This traded as low as $34.39 and the prior 52-week range was $35.05 to $46.66.

Monster Worldwide, Inc. (NYSE: MWW) is no shock to see on 52-week lows considering that jobs just aren’t coming back and are currently getting worse. Still, everyone in need of work is probably looking at Monster every night or weekend in hope of something even if it is not technically a “major” company. With a low of $10.65 today, the 52-week trading range of $10.95 to $19.28 was taken out by almost 3%.

Raytheon Company (NYSE: RTN) is not a huge shock to see on the list after all of the budget cuts. Despite a big contrarian research call recently that things might not be as bad as they seem in large ticket defense spending, shares hitting $43.16 definitely breached that prior 52-week trading range of $43.89.

Filed under: HI/LOW, Trading Alert, Value Investing Tagged: BAC, BBT, BBY, CME, CSC, GPS, HPQ, MDT, MHS, MWW, RTN, WFC

Top Analyst Upgrades and Downgrades (AFL, AAPL, AIZ, BBT, BUCY, DWA, HANS, BEE, TK, TXT, USB)

Administrator — Tue, 18 May 2010 12:26:26 +0000

These are some of the top analyst upgrades, downgrades, and initiations seen from Wall Street research calls this Tuesday morning:

Aflac Inc. (NYSE: AFL) Raised to Overweight at JPMorgan.
Apple Inc. (NASDAQ: AAPL) Started as Buy at Stern Agee (late Monday call).
Assurant Inc. (NYSE: AIZ) Cut to Neutral at JPMorgan.
BB&T Corp. (NYSE: BBT) Cut to Hold at Deutsche Bank.
Bucyrus International (NASDAQ: BUCY) Maintained Buy but removed from Conviction Buy List at Goldman Sachs.
DreamWorks Animation SKG (NYSE: DWA) Cut to Market Weight at Thomas Weisel.
Hansen Natural Corporation (NYSE: HANS) Raised to Buy at Goldman Sachs.
Strategic Hotels & Resorts (NYSE: BEE) Raised to Outperform at KBW.
Teekay Corp. (NYSE: TK) Raised to Overweight at JPMorgan.
Textron Inc. (NYSE: TXT) Raised to Conviction Buy List at Goldman Sachs.
US Bancorp (NYSE: USB) Cut to Hold at Deutsche Bank.

JON C. OGG

Sponsor: 26 Cheap Stocks to Sell – Cheap stocks have been on a tear recently, but nine out of ten stocks are circling the drain!

Filed under: Analyst Calls Tagged: AAPL, AFL, AIZ, BBT, BEE, BUCY, DWA, HANS, TK, TXT, USB

The Weekly Dividend (CLF, CPY, FDS, KEI, MSA, OPNT, POR, TKR, F, BBT, DOW, FUN, BP, GMCR, SPAN, TNK, IIJI, RAIL)

Administrator — Fri, 14 May 2010 15:27:39 +0000

We are not seeing the floodgate of dividend hikes as we had seen in earlier weeks this year, but hikes, talk of hikes, and other big dividend news changes are out this week. The true dividend hikes are in Cliffs Natural Resources Inc. (NYSE: CLF), CPI Corp. (NYSE: CPY), FactSet Research Systems Inc. (NYSE: FDS), Keithley Instruments Inc. (NYSE: KEI), Mine Safety Appliances Co. (NYSE: MSA), OPNET Technologies Inc. (NASDAQ: OPNT), Portland General Electric Company (NYSE: POR), and The Timken Company (NYSE: TKR). The hints of dividends includes Ford Motor Co. (NYSE: F), BB&T Corp. (NYSE: BBT), The Dow Chemical Company (NYSE: DOW), Cedar Fair LP (NYSE: FUN), BP plc (NYSE: BP), and Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR). Higher dividends that might not be outright hikes were seen in Span-America Medical Systems Inc. (NASDAQ: SPAN), Teekay Tankers Ltd. (NYSE: TNK), and Internet Initiative Japan Inc. (NASDAQ: IIJI). There is a downside of dividends, and that included FreightCar America, Inc. (NASDAQ: RAIL). Details on each are provided below, including the changes, a new implied yield and added color on each where applicable.

Real Hike, Real Payouts….

Cliffs Natural Resources Inc. (NYSE: CLF) voted early this week to increase the quarterly cash dividend by 60% to $0.14 per share. That is close to a yield of 2% now after the drop in the stock.

CPI Corp. (NYSE: CPY) also voted early this week to increase its quarterly dividend payout by 25% up to $0.25 per quarter. The yield today would be about 3.3%.

FactSet Research Systems Inc. (NYSE: FDS) approved a 15% hike to $0.23 per quarter in dividends from a prior rate of $0.20 per quarter. This is about 1.15% today for a dividend yield.

Keithley Instruments Inc. (NYSE: KEI) increased its quarterly dividend early this week to a rate of $0.0375 per share, and this new dividend yield is almost 1.5%.

Mine Safety Appliances Co. (NYSE: MSA) must be expecting new business lines… today declared a second quarter dividend of $0.25 per quarter, up a penny from the prior $0.24 per quarter dividend that had been in place since early 2008.

OPNET Technologies Inc. (NASDAQ: OPNT) hiked its payout after earnings early this week. It raised its quarterly dividend to $0.10 per quarter for almost a 2.4% yield. That is $0.40 per year, up from $0.36 per year for 2009.

Portland General Electric Company (NYSE: POR) announced Thursday night that it was boosting its dividend to $0.26 per share per quarter from a rate of $0.255 previously. The last three hikes have come each year and have been by a full penny rather than by a half-penny per quarter. This still generates more than a 5% yield.

The Timken Company (NYSE: TKR) announced earlier this week that it declared a quarterly cash dividend of $0.13, up 44% or versus a $0.09 prior dividend. This is after the company had seen its dividend go down to $0.09 from $0.18 previously in 2009, so this dividend raise is a game of moving back to even.

Dividend Hints……

Ford Motor Co. (NYSE: F) also hinted this week at a dividend return for shareholders, but the news we saw was that it is starting its education pay plan first after it repays more debt. Don’t hold your breath here for a dividend on the common shares any time in the immediate future.

BB&T Corp. (NYSE: BBT) hinted earlier this week that it would be among the first of the big banks to raise its dividend. On CNBC it seems that the hint was for a fourth quarter dividend raise, although it is no secret that the new environment is one where regulators have told banks to build capital reserves over paying out higher common dividends. The current rate is $0.15 per quarter, but that was down from $0.47 previously and the current payout was what it was in the 1990′s.

The Dow Chemical Company (NYSE: DOW) declared a dividend of $0.15… this is one we still expect that will buckle to peer pressure and may consider raising its dividend later this year. Much depends upon the merger integration from the 2009 Rohm & Haas deal and the notion that its business is just coming back. The current $0.15 per quarter still generates a yield of close to 2.2%, but this is down from $0.42 before it cut that dividend over a year ago.

Cedar Fair LP (NYSE: FUN) has seen this week with its largest shareholder (Q Funding) demanding that the company reinstate an annual dividend of $0.50 per share after suspending it in 2009. That does not assure a hike, but that is the largest holder. A $0.50 dividend would have an indicated yield before any share price changes of approximately 3.7%.

BP plc (NYSE: BP) has been in the soup over the Gulf of Mexico spill, but this week it declared on Tuesday that its board of directors has approved on April 27, 2010 an interim dividend of USD$0.14 per ordinary share or USD$0.84 per ADS for the first quarter 2010. This is technically a U.K.-based company, so it is doubtful that the administration can nix the dividend. Still, you have to wonder with cost estimates all over the board into the billions of dollars for the cleanup and remediation.

And speaking of very dividends, the stock split for Green Mountain Coffee Roasters, Inc. (NASDAQ: GMCR) of 3 for 1 will be reflected next week on the May 17 ex-date. Not a true dividend because these are generally tax-free events.

Higher Dividends, Maybe Not Hikes….

Span-America Medical Systems Inc. (NASDAQ: SPAN) usually has a $0.10 per quarter dividend, but this week it announced a Special Cash Dividend of $1.00 per share. That makes the third special dividend, and the regular $0.10 dividend is in effect as well.

Teekay Tankers Ltd. (NYSE: TNK) pays out its income as it comes and is able, so this “higher dividend” should not be considered a true hike. It announced a cash dividend of $0.37 per share, and here are the prior dividend rates to show the inconsistent rates:

Mar 4, 2010 $0.26 Dividend
Nov 18, 2009 $0.15 Dividend
Aug 20, 2009 $0.40 Dividend
May 20, 2009 $0.59 Dividend
Mar 4, 2009 $0.72 Dividend
Dec 1, 2008 $1.07 Dividend
Aug 13, 2008 $0.90 Dividend
May 21, 2008 $0.70 Dividend
Feb 13, 2008 $0.115 Dividend

Internet Initiative Japan Inc. (NASDAQ: IIJI) is one we have not seen the ADR list a dividend, so this may just be in local currency. The company said on Thursday’s earnings that its FY2009 year-end cash dividend forecast was revised from JPY1,000 to JPY1,250 per share of common stock (FY2009 total dividend of JPY2,250, up from JPY2,000 as previously planned).

The Downside of Dividends….

FreightCar America, Inc. (NASDAQ: RAIL) this week that its Board of Directors decided not to authorize the payment of a cash dividend on its common shares in the second quarter of 2010 to preserve cash to help maintain its balance sheet strength.

JON C. OGG

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Filed under: Dividend, The Week Tagged: BBT, BP, CLF, CPY, DOW, F, FDS, FUN, GMCR, IIJI, KEI, MSA, OPNT, POR, RAIL, SPAN, TKR, TNK

Top 10 Analyst Upgrades and Downgrades (BBT, BA, KO, FDX, FITB, MDVN, OVTI, RCL, ZUMZ, DIS)

247wallst — Thu, 04 Mar 2010 13:18:48 +0000

These are the top ten analyst calls we have seen in upgrades, downgrades, and initiations from Wall Street research calls this Thursday morning:

BB&T Corp. (NYSE: BBT) Raised to Outperform at Bernstein.
Boeing Co. (NYSE: BA) Raised to Neutral at UBS.
The Coca-Cola Company (NYSE: KO) Raised to Buy at UBS.
FedEx Corporation (NYSE: FDX) Raised to Outperform at Morgan Keegan.
Fifth Third Bancorp (NASDAQ: FITB) Cut to Market Perform at Bernstein.
Medivation, Inc. (NASDAQ: MDVN) Cut to Neutral at JPMorgan (oops).
OmniVision Technologies Inc. (NASDAQ: OVTI) Raised to Outperform at Baird.
Royal Caribbean Cruises Ltd. (NYSE: RCL) Raised to Neutral at Goldman Sachs.
Zumiez, Inc. (NASDAQ: ZUMZ) Raised to Overweight at Piper Jaffray.
Walt Disney Co. (NYSE: DIS) Raised to Buy at BofA/Merrill Lynch.

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JON C. OGG

Filed under: Analyst Calls Tagged: BA, BBT, DIS, FDX, FITB, KO, MDVN, OVTI, RCL, ZUMZ