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Ag/Mining Earnings on Fire: Caterpillar, Potash, and Peers (POT, CAT, BHP, CNH, BUCY, MOS, MOO)

Administrator — Thu, 27 Jan 2011 15:00:32 +0000

The message delivered today by earnings reports from Potash Corp. of Saskatchewan (NYSE: POT), Caterpillar Inc. (NYSE: CAT), and CNH Global N.V. (NYSE: CNH) is that as long as the world’s population continues to eat and emerging markets continue to thrive, sales and profits will continue to rise. Ditto for mining.

Potash Corp. reported fourth-quarter EPS of $1.61, including a charge of $0.16/share that the company spent to fend off a $38.6 billion takeover by BHP Billiton Ltd. (NYSE: BHP). The company posted revenue of $1.81 billion. Analysts were expecting EPS of $1.65 on revenue of $1.63 billion. In the same period a year ago, Potash Corp. posted EPS of $0.79 on revenue of $1.1 billion.

Caterpillar might be thought of as more of a mining play than just agriculture, but history has shown that the two are often intermingled. The equipment giant reported EPS for its fourth-quarter of $1.47 on sales of $12.8 billion. Analysts were expecting EPS of $1.27 on sales of $11.63 billion. CNH also reported earnings this morning. In the fourth quarter, the company posted EPS of $0.90, excluding restructuring and one-time charges, on sales of $3.76 billion. Analysts were expecting EPS of $0.45 on sales of $3.7 billion.

Both the fertilizer-maker and the two equipment makers benefited from rising food and commodity prices. And all three of the companies expect to increase their profitable ways in 2011.

Potash Corp. announced a three-for-one stock split yesterday and also raised its quarterly per share cash dividend from $0.10 to $0.21, on a split-adjusted basis. In the announcement, the company’s CEO noted that doubling the company’s dividend “reflects the confidence we have in the long-term drivers of our business.”

For 2011, Potash Corp. guided first-quarter EPS to $2.10-$2.70 and full-year EPS to $8.40-$9.60 on a pre-split basis. Analysts were expecting first-quarter EPS of $2.24 and full-year EPS of $8.89, pre-split.

Caterpillar expects 2011 sales to top $50 billion and EPS to be around $6.00. For 2010 the company had sales of $42.6 billion and EPS of $4.15. CNH expects 2011 revenue to rise by up to 10% and operating margins to be in the range of 7.1%-7.9%. In 2010, CNH posted total sales of $14.5 billion. For 2010, ag equipment operating margins were 7.1%, while construction equipment operating margins were -4.5%. CNH’s sales of ag equipment is roughly four times sales in construction equipment.

The continued growth in fertilizer and equipment sales stems from strong demand for potash fertilizer and strong demand for mining equipment. Caterpillar’s outlook is particularly strong because the company does not include sales from Caterpillar’s acquisition of Bucyrus International Inc. (NASDAQ: BUCY), which has not closed yet.

What about Mosaic Co. (NYSE: MOS)? It blew out earnings earlier in January, and now the Cargill majority stake divestiture may have the company in play for sale. Shares are still lower as they are under $80.00 versus above $85.00 when this was first announced, but the stock has also recovered from lows under $74.00. And what about Market Vectors Agribusiness ETF (NYSE: MOO)? Its shares are up 0.5% at $55.63 versus a 52-week range of $35.56 to $57.02. As agriculture keeps doing better and as the components keep rising, so do its shares.

Shares of Potash Corp. are up nearly 4% in pre-market trading, while Caterpillar shares are up about 1.5% and CNH has seen no action. If Caterpillar’s pre-market price holds, it would mark a new 52-week high for the company. All three have posted new 52-week highs since the beginning of the year.

Paul Ausick

Filed under: Agriculture, Earnings, International Markets, Metals, Stock Splits Tagged: BHP, BUCY, CAT, CNH, MOO, MOS, POT

Mining Win: Joy Today, Joy Ahead (JOYG, CAT, BUCY, BHP, VALE, RIO, XSRAY, AAUKY)

Administrator — Wed, 15 Dec 2010 16:42:15 +0000

The demand for metals and minerals of all kinds is pushing up sales and profits in the makers of the equipment used to extract the commodities. Joy Global, Inc. (NASDAQ: JOYG) reported earnings for its fourth fiscal quarter, and the company’s results and guidance are driving its shares higher this morning.

Joy Global reported EPS of $1.39 for the quarter, compared with estimates of $1.16. Profit rose from $124 million in the same period a year ago to $146.3 million this year, a boost of 18%. Revenue also rose 8.9%, to $1.05 billion, compared with estimates of $922.8 million. Competitor Caterpillar Inc. (NYSE: CAT) earlier reported better-than-expected earnings for its quarter ended in September, although Bucyrus Interntional, Inc. (NASDAQ: BUCY) missed earnings estimates in its most recent quarter. Bucyrus has agreed to be acquired by Caterpillar in a deal worth $7.6 billion.

For 2011, Joy Global projected EPS of $5-$5.30 on revenue between $3.9 and $4.1 billion. Previous estimates from analysts had projected 2011 EPS of $4.79 on revenue of $3.86 billion.

Joy Global’s CEO told the Financial Times that the equipment maker is “entering the earlier stages of another multiyear expansion of the industry.” Miners including BHP Billiton Ltd. (NYSE: BHP), Vale SA (NYSE: VALE), Rio Tinto plc (NYSE: RIO), Xstrata plc (OTC: XSRAY), and Anglo American plc (OTC: AAUKY) expect to invest as much as $120 billion in 2011 to boost production.

Even better for the mining equipment makers is that the miners are front-loading orders for new equipment in an attempt to guarantee delivery of new equipment and to get better pricing. Some miners are also agreeing to longer-term supply contracts with equipment makers in exchange for the guarantees and pricing.

Investors are piling into the sector, expecting higher profits and, perhaps even better, more mergers and acquisitions of both publicly-traded and private equipment manufacturers.

The danger to all this growth, at least from the miners point of view, is that costs will rise almost uncontrollably. Wages, inflation, and long lead times to develop new supplies could combine to constrain their response the greater demand. That will drive commodities prices even higher. Miners remember all too well the problems that occurred in 2008,leading to their inability to acquire the huge tires they needed for the enormous ore trucks. For want of a nail…

So while the miners might struggle a bit, the equipment makers, like Joy Global, are expected to prosper. The company’s stock is up about 8% following its earnings report, while Caterpillar stock is up about 3%.

Paul Ausick

Filed under: Earnings, Metals Tagged: AAUKY, BHP, BUCY, CAT, JOYG, RIO, VALE, XSRAY

Top Analyst Upgrades and Downgrades (APWR, ATHN, STD, BLK, BMRN, BUCY, FCS, LEAP, LM, MOT, NETL, RIMM, SWX, SBUX)

Administrator — Thu, 02 Dec 2010 13:19:40 +0000

These are some of this Thursday’s key analyst upgrades, downgrades, and initiations seen in Wall Street research calls.

A-Power Energy Generation Systems (NASDAQ: APWR) Cut to Perform at Oppenheimer.
Athenahealth, Inc. (NASDAQ: ATHN) Cut to Market Perform at FBR.
Banco Santander, S.A. (NYSE: STD) Cut to Hold at RBS.
Blackrock Inc. (NYSE: BLK) Started as Outperform at Wells Fargo.
BioMarin Pharmaceutical Inc. (NASDAQ: BMRN) Cut to Neutral at UBS.
Bucyrus International (NASDAQ: BUCY) Cut To Neutral From Buy By Goldman Sachs
Fairchild Semiconductor International Inc. (NYSE: FCS) Started as Overweight at JPMorgan.
Leap Wireless International (NASDAQ: LEAP) Cut to Underweight at Piper Jaffray
Legg Mason, Inc. (NYSE: LM) Started as Market Perform at Wells Fargo.
Motorola Inc. (NYSE: MOT) Cut to Reduce at Nomura.
NetLogic Microsystems Inc. (NASDAQ: NETL) Started as Buy at Gleacher.
Research In Motion Ltd. (NASDAQ: RIMM) Started as Neutral at Nomura.
Southwest Gas Corporation (NYSE: SWX) Cut to Hold at Argus.
Stabucks Corporation (NASDAQ: SBUX) Maintained Neutral but raised target to $35 at BofA/ML.
Suntech Power Holdings Co., Ltd. (NYSE: STP) Raised to Buy at Auriga.
Trina Solar Ltd. (NYSE: TSL) Cut to Sell at Axiom.

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: APWR, ATHN, BLK, BMRN, BUCY, FCS, LEAP, LM, MOT, NETL, RIMM, SBUX, STD, SWX

Top Analyst Upgrades and Downgrades (BHP, BUCY, CAT, KO, CREE, DPS, INTU, JOYG, KMB, NLST, PEP, POT, SNH, CODE, TCO)

Administrator — Tue, 16 Nov 2010 13:02:22 +0000

These are some of this Tuesday’s key analyst upgrades, downgrades, and initiations seen in Wall Street research calls.

BHP Billiton plc (NYSE: BHP) Started as Buy at Goldman Sachs.
Bucyrus International (NASDAQ: BUCY) Cut to Neutral at Baird; Cut to Neutral at Sterne Agee; Cut to Hold at Jefferies.
Caterpillar Inc. (NYSE: CAT) Raised to Outperform at Raymond James.
The Coca-Cola Company (NYSE: KO) Started as Outperform at Bernstein.
Cree Inc. (NASDAQ: CREE) Raised to Outperform at Morgan Keegan.
Dr. Pepper Snapple (NYSE: DPS) Started as Outperform at Bernstein.
Intuit Inc. (NASDAQ: INTU) Reiterated Buy and Raised Target to $54 at BofA/ML.
Joy Global, Inc. (NASDAQ: JOYG) Cut to Neutral at Sterne Agee.
Kimberly-Clark Corporation (NYSE: KMB), a stock to own for the next decade, Started as Hold at Jefferies.
Netlist Inc. (NASDAQ: NLST) Cut to Hold at Needham.
PepsiCo, Inc. (NYSE: PEP) Started At Outperform By Bernstein >PEP
Potash Corp. of Saskatchewan (NYSE: POT) Raised to Sector Outperform at CIBC.
Senior Housing Properties Trust (NYSE: SNH) Raised to Buy at Jefferies.
Spansion Inc. (NASDAQ: CODE) Started as Buy at Needham.
Taubman Centers. Inc. (NYSE: TCO) Raised to Outperform at Credit Suisse.

JON C. OGG

Filed under: Analyst Calls Tagged: BHP, BUCY, CAT, CODE, CREE, DPS, INTU, JOYG, KMB, KO, NLST, PEP, POT, SNH, TCO

Top Active Trader Alert Stocks (BUCY, CSUN, GTSI, ISLN, RINO)

247wallst — Mon, 15 Nov 2010 13:43:23 +0000

Active traders and day traders have many stocks to choose from this Monday morning. We are tracking news and moves in shares of Bucyrus International Inc. (NASDAQ: BUCY), China Sunergy Co., Ltd. (NASDAQ: CSUN), GTSI Corp. (NASDAQ: GTSI), Isilon Systems, Inc. (NASDAQ: ISLN), and RINO International Corporation (NASDAQ: RINO).

Bucyrus International Inc. (NASDAQ: BUCY) has jumped nearly 30% pre-market to $90.35, well above its 52-week range of $45.04-$75.08 after Caterpillar announced it would acquire the company.

China Sunergy Co., Ltd. (NASDAQ: CSUN) is up after a promising 3Q earnings call this morning.

GTSI Corp. (NASDAQ: GTSI) is up on strong 3Q profits.

Isilon Systems, Inc. (NASDAQ: ISLN) is one of today’s biggest pre-market gainers, posting nearly a 30% jump to $34.11. It was just announced that the company would be acquired by EMC.

RINO International Corporation (NASDAQ: RINO) is down pre-market to $9.50, below its previous low of $10.26.

Filed under: Pre-Market Activity Tagged: BUCY, CAT, CSUN, GTSI, ISLN, RINO

Bucyrus Buyout: Flurry of Sector Interest (BUCY, CAT, JOYG, TEX, MTW)

Administrator — Mon, 15 Nov 2010 13:34:38 +0000

The day has come for Bucyrus International Inc. (NASDAQ: BUCY). Caterpillar Inc. (NYSE: CAT) has announced that it will expand its mining equipment operations and product offerings with the acquisition of Bucyrus. The deal is valued at $8.6 billion after the inclusion of debt. Bucyrus shareholders will receive $92.00 per share, which is about $7.6 billion in aggregate consisting of all cash in a deal representing a 32% premium to Friday’s close.

Caterpillar will fund the acquisition through a combination of cash from the balance sheet, debt and up to $2 billion in equity. Caterpillar has noted that its mining customers have been asking it to expand the range of products and services to better serve their increasingly complex requirements.

Bucyrus is soaring by almost 30% at $90.35 in active trading. What is interesting is that investors are treating this potentially as the first of several consolidation prospects in the mining equipment sector. If you look at the Bucyrus competitors and others in the mining equipment space, the moves speak for themselves:

Joy Global, Inc. (NASDAQ: JOYG) is indicated up over 7% at $77.88; the 52-week range is (was) $42.45 to $76.72.

Terex Corp. (NYSE: TEX) is up over 8% at $26.40; its 52-week range is $16.79 to $28.71.

Manitowoc Co. Inc. (NYSE: MTW) is up over 4% at $11.67; its 52-week range is $8.48 to $16.43.

Bucyrus designs and makes equipment for mining of coal, copper, oil sands, iron ore, and other minerals in mining centers worldwide. The deal is apparently the largest of Caterpillar’s of the sort, although this is an easy integration for the company as Caterpillar had a market cap in excess of $48 billion. Caterpillar shares are down 1.9% at $79.47 versus a 52-week range of $50.50 to $83.84.

JON C. OGG

Filed under: Agriculture, Mergers and Buy Outs, Metals Tagged: BUCY, CAT, JOYG, MTW, TEX

Top 10 Analyst Upgrades and Downgrades (AAPL, BAC, BP, BUCY, DB, FDO, GS, JOYG, LLTC, RFMD)

Administrator — Tue, 06 Jul 2010 12:25:14 +0000

These are some ten the top analyst upgrades, downgrades, and initiations seen from Wall Street research early this Tuesday:

Apple Inc. (NASDAQ: AAPL) estimates cut at Kaufman.
Bank of America Corporation (NYSE: BAC) Raised to Buy at NAB.
BP plc (NYSE: BP) Raised to Buy at RBS.
Bucyrus International (NASDAQ: BUCY) Started as Outperform at Macquarie.
Deutsche Bank AG (NYSE: DB) Cut to Underweight at JPMorgan.
Family Dollar Stores Inc. (NYSE: FDO) Raised to Buy at Citigroup.
Goldman Sachs Group Inc. (NYSE: GS) Raised to Overweight at JPMorgan.
Joy Global, Inc. (NASDAQ: JOYG) Started as Outperform at Macquarie.
Linear Tech Corporation (NASDAQ: LLTC) Raised to Overweight at JPMorgan.
RF Micro Devices Inc. (NASDAQ: RFMD) Cut to Underweight at JPMorgan.

JON C. OGG

Filed under: Analyst Calls Tagged: AAPL, BAC, BP, BUCY, DB, FDO, GS, JOYG, LLTC, RFMD

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

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

Top Day Trader Alerts (MSFT, AMZN, ERIC, BUCY, PALM, WDC)

Administrator — Fri, 23 Apr 2010 13:07:49 +0000

These are this morning’s top day trader and active trader alerts. Most are earnings related and this is just a select group of stocks on the move during the earnings season onslaught. We have detailed information on the news, the move, and relative volume on each in the links over at VSInvestor.com:

Microsoft Corp. (NASDAQ: MSFT) and Amazon.com, Inc. (NASDAQ: AMZN) are both trading lower after the earnings reports.

LM Ericsson Telephone Company (NASDAQ: ERIC) is up about 6% despite what appeared to be an earnings miss.

Bucyrus International Inc. (NASDAQ: BUCY) is down about 6% after earnings.

Palm Inc. (NASDAQ: PALM) is up about 4%… rumor Friday?

Western Digital Corp. (NYSE: WDC) is up over 3% after earnings and upgrades.

Acura Pharmaceuticals (ACUR) is the worst NASDAQ performer after an FDA panel went against its painkiller.

JON C. OGG

Filed under: Pre-Market Activity, Trading Alert Tagged: AMZN, BUCY, ERIC, MSFT, PALM, WDC

Top 10 Analyst Upgrades and Downgrades (ADSK, STD, BBVA, BUCY, EOG, XCO, LEAP, STEC, TWX, UPL)

247wallst — Wed, 24 Feb 2010 12:56:37 +0000

These are this Wednesday’s top 10 analyst upgrades, downgrades, and initiations seen from Wall Street research calls early this morning:

Autodesk Inc. (NASDAQ: ADSK) Raised to Buy at Needham.
Banco Santander (NYSE: STD) Cut to Underweight at Barclays.
Banco Bilbao Vizcaya Argentaria (NYSE: BBVA) Cut to Underweight at Barclays.
Bucyrus International (NASDAQ: BUCY) Started as Buy at Goldman Sachs.
EOG Resources (NYSE: EOG) Raised to Buy at Goldman Sachs.
EXCO Resources (NYSE: XCO) Raised to Conviction Buy List at Goldman Sachs.
Leap Wireless International (NASDAQ: LEAP) Reiterated Hold ahead of earnings at Auriga.
STEC Inc. (NASDAQ: STEC) cut to Hold at Deutsche Bank; Cut to Neutral at JPMorgan; Cut to Market Weight at Thomas Weisel.
Time Warner Inc. (NYSE: TWX) Started as Buy at Janney Montgomery.
Ultra Petroleum (NYSE: UPL) maintained Buy but removed from Conviction Buy List at Goldman Sachs.

You are invited to join our free daily email distribution list to hear about top analyst upgrades and downgrades, IPOs and secondary offerings, ongoing day trader and options trader alerts, stock and market rumors, Buffett and guru investor news, M&A and more.

JON C. OGG

Filed under: Analyst Calls Tagged: ADSK, BBVA, BUCY, EOG, LEAP, STD, STEC, TWX, UPL, XCO