24/7 Wall St. » CHTR

Media Digest (12/20/2011) Reuters, WSJ, NYT, FT

247wallst — Tue, 20 Dec 2011 11:20:21 +0000

AT&T (NYSE: T) gives up on its effort to buy T-Mobile. (Reuters)

Apple (NASDAQ: AAPL) wins a patent case over HTC in the smartphone wars. (Reuters)

Olympus will sell shares to Sony (NYSE: SNE) and Fuji Film to help its battered balance sheet. (Reuters)

A new set of loans to the IMF will be set to help struggling EU nations, but the UK did not contribute to the 150 billion euro fund. (Reuters)

In a sign of worsening trouble for the financial firm, Bank of America (NYSE: BAC) shares trade below $5. (Reuters)

LightSquared, Falcone’s wireless company, is nearly out of money. (Reuters)

Sony sold 321,000 PlayStation Vitas in its first two days on sale. (Reuters)

A tax increase in the U.S. for 2012 is more likely as Congress wrangles over a budget. (WSJ)

An ITC ruling against HTC may hurt the efforts of Google’s (NASDAQ: GOOG) Android. (WSJ)

Google and KKR (NYSE: KKR) will invest in a new solar venture. (WSJ)

The U.S. Army Corps of Engineers granted ConocoPhillips (NYSE: COP) permission to drill in northern Alaska. (WSJ)

Caterpillar (NYSE: CAT) says its sales growth has improved. (WSJ)

FBI reports show crime dropped for the fourth straight year. (WSJ)

Spain will try to cut its deficit by more than $21 billion next year. (WSJ)

The number two executive at Cablevision (NYSE: CVC), Tom Rutledge, leaves for Charter (NASDAQ: CHTR). (WSJ)

Winn-Dixie is taken private by BI-LO for $560 million. (WSJ)

The New York Times (NYSE: NYT) may sell 16 local newspapers. (WSJ)

Procter & Gamble (NYSE: PG) has set plans for online coupons. (WSJ)

China may allow its citizens to invest more overseas. (WSJ)

A new UK plan will make banks and investment houses legally different entities by 2019. (NYT)

Japan will buy a new F-35 fighter jet from Lockheed Martin (NYSE: LMT). (FT)

The European Central Bank says contagion remains the greatest risk of the EU financial crisis. (FT)

Douglas A. McIntyre

Filed under: Press Digest Tagged: AAPL, BAC, CAT, CHTR, COP, CVC, GOOG, KKR, LMT, NYT, PG, SNE, T

Cablevision Remains Too Oversold and a Bargain (CVC, TWC, CMCSA, DTV, CHTR, MSG, AMCX)

Administrator — Wed, 16 Nov 2011 13:11:24 +0000

Cablevision Systems Corp. (NYSE: CVC) is still trading just above the $15.00 mark and its 52-week range is $14.18 to $38.08. The long-term stock chart is a bit misleading because of spin-offs, but the shares remain oversold. Because of its sell-off, Cablevision currently looks cheaper on many metrics compared to Time Warner Cable Inc. (NYSE: TWC), Comcast Corporation (NASDAQ: CMCSA), DIRECTV (NASDAQ: DTV) and Charter Communications Inc. (NASDAQ: CHTR).

If you just watched the Cablevision stock chart, it would seem as though cable was dying. It is not. Cablevision has been cleaning its books up and it has parted ways with Madison Square Garden and AMC Networks for the most part. Again, those changes skew the stock charts.

We no longer have any serious hope of takeover ambitions resurfacing, but the Dolan family did try to buy it before at much higher prices and that deal was rejected. The current market cap is only $4.3 billion and that does make it capable of a deal if another player wanted to make an offer. A sum-of-the-parts analysis remains “oversold” and this value is solely on the merits of the company on a standalone basis. This one can still slide if the market softens, but this remains underpriced and we think higher prices will be reflected when things normalize.

Dividend and income investors now have an accidentally high-yield of almost 4%. Even after the AMC spin-off, shares fell from $25 to under $15 and the selling was just too harsh for a company that trades at close to 11.5-times 2012 earnings estimates.
Our take is that Cablevision should easily be a $20.00 stock after the dust settles, and that opinion has nothing to do with what Barron’s touted as being worth $30.00 per share in a buyout.

The current $15.00 share price compares to a Thomson Reuters consensus price target of $22.14. Our projection calls for close to 33% gains due to mispricing right now, and our projection is even less than the consensus target and far less than what Barron’s recently published.

This was one of seven oversold picks poised for a comeback which was offered recently to our readers who sign up for our free daily newsletter service. Each morning’s free newsletter is sent by email and includes the top news headlines, shows the top 15 or so analyst upgrades and downgrades, covers activist investor and insider trading, and offer key trading alerts for investors. Sign up in the box below.

JON C. OGG

Filed under: Cable Companies, Media, Value Investing Tagged: AMCX, CHTR, CMCSA, CVC, DTV, MSG, TWC

Expected Price Gains for Network and Cable TV Operators (CBS, DIS, CMCSA, TWC, DISH, DTV, VIA, LSTZA, DISCA, CHTR)

Paul Ausick — Mon, 31 Oct 2011 18:12:27 +0000

There are plenty of challenges facing the network and cable TV industry these day, not the least of which is the growth in streaming video. The well-known troubles of Netflix Inc. (NASDAQ: NFLX) to one side for a moment, the market for streaming is growing, while some cable operators are losing subscribers. Broadcast networks with content to license are better placed to profit, while cable operators with their own spectrum might be in the best position of all, at least in the near term.We’re looking today at 10 companies with broadcast or satellite/cable businesses (or both): CBS Corp. (NYSE: CBS), Walt Disney Co. (NYSE: DIS), Comcast Corp. (NASDAQ: CMCSA), Time Warner Cable Inc. (NYSE: TWC), Dish Network Corp. (NASDAQ: DISH), DIRECTV (NASDAQ: DTV), Viacom, Inc. (NYSE: VIA), Liberty Starz Group (NASDAQ: LSTZA), Discovery Communications Inc. (NASDAQ: DISCA), and Charter Communications Inc. (NASDAQ: CHTR).

All data from Yahoo! Finance and current stock prices were gathered about noon today.

CBS Corp. (NYSE: CBS) has a median target price of $31.00 from 22 brokers. Shares are trading today at $25.66, for an implied gain of $5.34, or 21%. CBS’s forward P/E is 11.62 and the company pays a dividend yield of 1.6%. The stock’s 52-week trading range is $15.99-$29.68, and at today’s price that’s about 60% above its 52-week low, posted earlier this morning, and 14% below the 52-week high. CBS is scheduled to release third-quarter earnings on Thursday. The consensus EPS estimate is $0.46 on revenue of $3.43 billion. A year ago the company posted sales of about $3.3 billion and last quarter revenue totaled nearly $3.6 billion. There’s room for the share price to rise, but neither the 52-week high nor the target price are endangered in the near term.

Walt Disney Co. (NYSE: DIS) has a median target price of $40.00 from 24 brokers. Shares are trading today at $35.34, for an implied gain of $4.66, or 13%. Disney’s forward P/E is 12.28 and the company pays a dividend yield of 1.1%. The stock’s 52-week trading range is $28.19-$44.34, and at today’s price that’s about 25% above its 52-week low, posted earlier this morning, and 20% below the 52-week high. Disney is much more than a distribution channel. Its ability to create compelling content and then license it for further distribution is practically equal to a license to print money. Analysts expect EPS of $0.54 on revenue of $10.36 billion when Disney reports third-quarter earnings next week.

Comcast Corp. (NASDAQ: CMCSA) has a median target price of $30.00 from 24 brokers. Shares are trading today at $23.60, for an implied gain of $6.40, or 27%. Comcast’s forward P/E is 12.35 and the company pays a dividend yield of 1.9%. The stock’s 52-week trading range is $19.19-$27.16, and at today’s price that’s about 23% above its 52-week low, posted earlier this morning, and 13% below the 52-week high. Comcast owns both content and the fat pipes to distribute that content. Because distribution of streaming content is fast becoming a commodity, it’s Comcast’s NBCUniversal media business that will carry Comcast forward. The $30 target price is probably safe for a while, but the company’s 52-week high could be in the sights.

Time Warner Cable Inc. (NYSE: TWC) has a median target price of $85.00 from 22 brokers. Shares are trading today at $62.91, for an implied gain of $22.09, or 35%. Time Warner’s forward P/E is 11.25 and the company pays a dividend yield of 3.1%. The stock’s 52-week trading range is $47.89-$79.21, and at today’s price that’s about 31% above its 52-week low, posted earlier this morning, and 21% below the 52-week high. In its last quarter, Time Warner lost subscribers and posted lower profits. The company believes it will make its forecast annual profit, but warned that advertising was falling. It’s easy for subscribers to drop cable subscriptions in a tight economy, and as the holidays come round, dropping cable service to have a few more bucks to spend on gifts will occur to a lot of viewers.

Filed under: Analyst Calls, Cable Companies, Entertainment Tagged: CBS, CHTR, CMCSA, DIS, DISCA, DISH, DTV, LSTZA, TWC, VIA

24/7 Wall St. Top Analyst Upgrades & Downgrades of the Prior Week (ALU, BIDU, CHTR, FSLR, F, NUE, STX, WMT, WFM, ZLC, WDC, AAPL)

Administrator — Mon, 24 Oct 2011 11:41:38 +0000

Each morning 24/7 Wall St. issued a list of some of the key analyst upgrades, downgrades, and initiations seen from Wall Street research firms. At the end of the week we review these calls to see which ones stand out the most. Some are great calls that were greatly insightful, some are long-term and far-reaching in nature. Other calls may be relevant well into the future, and some calls manage to be just awful. After filtering these calls out, these become the top analyst calls of the week.

This weeks top analyst calls were in the following stocks: Alcatel-Lucent SA (NYSE: ALU); Baidu, Inc. (NASDAQ: BIDU); Charter Communications Inc. (NASDAQ: CHTR); First Solar Inc. (NASDAQ: FSLR); Ford Motor Co. (NYSE: F); Nucor Corporation (NYSE: NUE); Seagate Technology PLC (NASDAQ: STX);Wal-Mart Stores, Inc. (NYSE: WMT); Whole Foods Market Inc. (NASDAQ: WFM); and Zale Corporation (NYSE: ZLC)

Alcatel-Lucent SA (NYSE: ALU) was previously the high-flying network and communications equipment stock of the year, but then it went to being the most butchered stock of all of its peers. We wonder if this downgrade last week that took the price target to $2.35 as the rating was cut to Underperform at Jefferies may have been the last bit of bad news to get out of the way. Jefferies doesn’t seem to think so.

Baidu, Inc. (NASDAQ: BIDU) is one of the companies which we had listed as being one to outperform Apple Inc. (NASDAQ: AAPL) over the next year if the analysts were anywhere close to accurate on their price targets. Needless to say, it was a bit surprising to see that the rating was cut to Neutral from Buy at Goldman Sachs when it seems as though China is seeing a soft landing rather than a hard landing.

Charter Communications Inc. (NASDAQ: CHTR) is out of bankruptcy and is still sort of considered the laggard of the cable TV sector. Not to Credit Suisse. The firm initiated coverage with a rating of “Outperform” and it gave a $60.00 price target. That would get the stock only within $1.00 of its post-reorganization high and the consensus price target from Thomson Reuters appears to be above $66 on this one.

First Solar Inc. (NASDAQ: FSLR) is becoming the whipping boy of Wall Street. Despite shares falling almost each and every week, its rating was cut last Monday to Hold from But by the research team at S&P Capital IQ.

Ford Motor Co. (NYSE: F) caught a corporate credit rating upgrade on Friday from Standard & Poor’s that takes Ford to one-notch under investment grade. The rating rose from “BB-” to “BB+” and that brings Ford closer and closer to being comfortable enough to resuming its quarterly dividend payments. Ford rose 4.7% on the news.

Nucor Corporation (NYSE: NUE) may have finally found a level where the stock value equals the upside. The specialty steel player was Started as Outperform at Wells Fargo on Wednesday as shares were down more than 30% from the yearly high.

Seagate Technology PLC (NASDAQ: STX) rose well over 25% on Friday due to the woes of rival Western Digital Corporation (NYSE: WDC) due to Thailand floods hurting production. Seagate was raised to Outperform at Baird and also raised to Buy at ThinkEquity on Friday ahead of the continued move higher.

Wal-Mart Stores, Inc. (NYSE: WMT) is acting as though it wants to break out to the upside on the chart and go above the $55 ‘chart peak” to challenge $60.00 again. Coincidentally, last Wednesday it was named as the Growth & Income Stock of the Day by Zacks investment research. Maybe this time really is different.

Whole Foods Market Inc. (NASDAQ: WFM) is just about always an expensive stock and buying it on pullbacks has generally been a gift. One analyst thinks it is not so expensive, or at least thinks that the organic and high-end grocery destination is heading higher still. Shares were raised to Buy at Jefferies and the price target is $90.00 per share. That is $15 above the consensus price target.

Zale Corporation (NYSE: ZLC) is the jeweler that needs all the help it can get and it is far less actively covered than say Tiffany. Last week shares were raised to Buy at BofA/Merrill Lynch as the company has a new CFO and as the bank expects a turnaround to continue. Shares were under $3.00 early in the week and closed at $3.71 on Friday.

JON C. OGG

Filed under: Analyst Calls, The Week Tagged: AAPL, ALU, BIDU, CHTR, F, FSLR, NUE, STX, WDC, WFM, WMT, ZLC

24/7 Wall St. Closing Bell (BAC, CHTR, HAL, EP, KO, IBM, JNJ, STT, APEI, BMI, CROX, HALO, HOG, HGSI, USU)

Administrator — Tue, 18 Oct 2011 20:08:25 +0000

Today was a day of red that went to a day of green. Earnings were at first a disappointment, and producer price index came out far hotter at +0.8% on the headline number before the +0.2% reading if you back out food and energy prices from the producer prices. The market rallied with financial stocks from the start of the day and the market losses suddenly became gains. Homebuilders also looked a bit less-pessimistic in their latest survey. The big news came from a report out of England that France and Germany have supposedly agreed to increase the European Financial Stability Fund to up to $2 billion ahead of the Sunday meeting, although this seems to be a stretch based upon Europe’s slowness to act so far.

The unofficial closing bells put the DJIA up triple digits with a gain of 178 points to 11,575.46, the NASDAQ rose more than 42 (1.6%) to 2,657.43, and the S&P 500 rose 2% or 24 points to 1,225.28. Today’s top analyst upgrade and downgrade calls were numerous and included Charter Communications Inc. (NASDAQ: CHTR), Halliburton Company (NYSE: HAL), and more than a dozen other companies.

There has been a turnaround from the indicated loss in Bank of America Corporation (NYSE: BAC) after its earnings showed that book value managed to actually grow and the stock was up almost 10% at $6.63 late in the session.

Some food for thought… Now the MLP and pipeline sector may look cheap on the heels of the El Paso Corporation (NYSE: EP) buyout.

As far as the other big earnings report reactions today (prices within 20 minutes of the closing bell): The Coca-Cola Company (NYSE: KO) was down 0.3% at $66.79; International Business Machines Corporation (NYSE: IBM) was a huge drag on teh DJIA with shares still down 4.5% at $178.30; Johnson & Johnson (NYSE: JNJ) was up 1.2% at $64.54; State Street Corporation (NYSE: STT) was up 9% at $36.97.

Several other standouts from today are as follows…

American Public Education Inc. (NASDAQ: APEI) lost more than 20% of its value to $30.05 after the American Military University will see far lower tuition assistance from the U.S. Marine Corps.

Badger Meter Inc. (NYSE: BMI) was a loser even if it is supposed to be a water winner after missing earnings estimates. Shares were down 13% at $29.08 in the final minutes of the day.

Crocs Inc. (NASDAQ: CROX) was a disaster after an earnings warning that would not have been so bad had the stock not been up 100% from its 52-week lows before the report. The stock was down a massive 39% at $16.20 right before the close on more than 8-times normal volume of 25 million shares.

Halozyme Therapeutics Inc. (NASDAQ: HALO) was such a winner that it should be called “Master Chief” for its stock ticker. Its subcutaneous Herceptin trial met the study goals and the stock was up over 18% at $7.34 right before the close. This was not even a 52-week high.

Harley-Davidson Inc. (NYSE: HOG) was about 4% shy of sales targets in its earnings report and that had the stock down 7% to $34.56 right before the close. With a 52-week high of $46.88, it seemed a bit harsh of a reaction even with slightly lower margin guidance.

Human Genome Sciences Inc. (NASDAQ: HGSI) was up over 15% at $12.95 on reports that a $25.00 per share buyout could be headed its way. We gave a handicap on the odds of a deal happening.

USEC Inc. (NYSE: USU) broke a major run higher today and still no news exists. The belief is that the loan approval from the DOE may get a better review now that solar loan fraud seems to be prevailing after Solyndra. Shares were down 4% at $2.10 right before the close. Still, this was a $1.30 stock just last Thursday.

Stay tuned for Wednesday. We have speeches to watch from Rosengren and Lockhart on the docket as well as a hearing about ETFs. Here are some economic releases due in the morning and throughout the day:

8:30 September CPI
8:30 Housing Starts
10:30 Weekly Oil Inventories
2:00 PM Beige Book

JON C. OGG

Filed under: Economy, The Day Tagged: APEI, BAC, BMI, CHTR, CROX, EP, HAL, HALO, HGSI, HOG, IBM, JNJ, KO, STT, USU

Top Analyst Upgrades & Downgrades (AA, BHI, BRCM, CFN, CHTR, C, FNF, FSLR, GS, HAL, LULU, M, PGR, QCOM, UNH, URBN, VMW, WHR)

Administrator — Tue, 18 Oct 2011 12:22:06 +0000

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

Alcoa Inc. (NYSE: AA) Started as Buy at Stifel Nicolaus.
Baker Hughes Inc. (NYSE: BHI) Started as Buy at Stern Agee.
Broadcom Corporation (NASDAQ: BRCM) Started as Buy at Societe Generale.
CareFusion Corporation (NYSE: CFN) Started as Market Perform at BMO.
Charter Communications Inc. (NASDAQ: CHTR) Started as Outperform with $60 target at Credit Suisse.
Citigroup Inc. (NYSE: C) cut estimates and cut target to $45 from $50 at Credit Suisse’ Maintained Sell at Argus.
Fidelity National Financial (NYSE: FNF) named Value stock of the day at Zacks.
First Solar Inc. (NASDAQ: FSLR) Cut to Hold at S&P Equity Research (late-Monday call).
The Goldman Sachs Group Inc. (NYSE: GS) Cut to Underperform as Bear of the Day at Zacks.
Halliburton Company (NYSE: HAL) Started as Buy at Stern Agee; Reiterated Buy at Canaccord Genuity.
Lulelemon Athletica Inc. (NASDAQ: LULU) Started as Neutral at Macquarie.
Macy’s Inc. (NYSE: M) Started as Outperform at Macquarie.
Progressive Corp. (NYSE: PGR) Cut to Hold at Argus.
QUALCOMM Incorporated (NASDAQ: QCOM) Started as Hold at Societe Generale.
UnitedHealth Group, Inc. (NYSE: UNH) named Bull of the Day at Zacks.
Urban Outfitters, Inc. (NASDAQ: URBN) Started as Underperform at Macquarie; Started as Outperform at FBR.
VMware Inc. (NYSE: VMW) Cut to Hold at Jefferies.
Whirlpool Corporation (NYSE: WHR) Cut to Sell at Goldman Sachs.

JON C. OGG

Filed under: Analyst Calls Tagged: AA, BHI, BRCM, C, CFN, CHTR, FNF, FSLR, GS, HAL, LULU, M, PGR, QCOM, UNH, URBN, VMW, WHR

24/7 Wall St. Top Analyst Calls of the Week (AMD, AMZN, AAPL, CHTR, CMA, GXP, GMCR, NFLX, RVBD, TEVA, UTX, VLO)

Administrator — Sun, 02 Oct 2011 11:45:07 +0000

This last week was a bad end to a bad quarter and the research calls were very mixed. We went through the numerous upgrades and downgrades to identify which calls were insightful as well as to identify some of the big winning calls and the losing calls.

The top analyst calls of the last week from Wall Street research firms were in the following: Advanced Micro Devices Inc. (NYSE: AMD); Amazon.com Inc. (NASDAQ: AMZN); Apple Inc. (NASDAQ: AAPL); Charter Communications Inc. (NASDAQ: CHTR); Comerica Incorporated (NYSE: CMA); Great Plains Energy Incorporated (NYSE: GXP); Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR); Netflix, Inc. (NASDAQ: NFLX); Riverbed Technology, Inc. (NASDAQ: RVBD); Teva Pharmaceutical Industries Limited (NASDAQ: TEVA); United Technologies Corporation (NYSE: UTX); and Valero Energy Corporation (NYSE: VLO).

Advanced Micro Devices Inc. (NYSE: AMD) was a stock that burned UBS this week pretty bad. On Raised came word that UBS raised the rating to Buy. On Wednesday the company dropped the hammer that it is having manufacturing issues that is enough for a lower revenue and margin forecast. Shares went from close to $6.50 up over $6.60 the following day, but the stock closed out te week at $5.08 and hit a new 52-week low of $5.07 on Friday as well. Too bad, but AMD was a bad break for UBS and it took at least 4 downgrades after the news.

Amazon.com Inc. (NASDAQ: AMZN) was maintained with a “Buy” rating and with $255 target at Bank of America Merrill Lynch this last week after the new Kindles were released. There is just one problem, we noted over the weekend that Amazon doesn’t appear to be making money off the new products.

Filed under: Analyst Calls, The Week Tagged: AAPL, AMD, AMZN, CHTR, CMA, GMCR, GXP, NFLX, RVBD, TEVA, UTX, VLO

Top Analyst Upgrades & Downgrades (AAPL, CAT, CHTR, CL, CMCSA, CMA, DE, DTV, IFT, KMB, LRCX, MW, NVLS, NTRI, RL, TEVA, PAY, WCRX)

Administrator — Wed, 28 Sep 2011 12:17:59 +0000

These are some of this Wednesday’s top analyst upgrades, downgrades, and initiations seen having an impact from Wall Street research calls.

Apple Inc. (NASDAQ: AAPL) Started as Buy with $495 target at Janney.
Caterpillar Inc. (NYSE: CAT) Started as Overweight at Barclays.
Charter Communications Inc. (NASDAQ: CHTR) Started as Overweight at JPMorgan.
Colgate-Palmolive Co. (NYSE: CL) Cut to Hold at Citigroup.
Comcast Corporation (NASDAQ: CMCSA) Started as Overweight at JPMorgan.
Comerica Incorporated (NYSE: CMA) Raised to Market Perform at Wells Fargo.
Deere & Co. (NYSE: DE) Started as Overweight at Barclays.
DIRECTV (NASDAQ: DTV) Started as Overweight at JPMorgan.
Imperial Holdings, LLC (NYSE: IFT) Cut to Market Perform at FBR.
Kimberly-Clark Corporation (NYSE: KMB) Cut to Hold at Citigroup.
Lam Research Corporation (NASDAQ: LRCX) Started as Overweight at JPMorgan.
Men’s Wearhouse Inc. (NYSE: MW) named value stock of the day at Zacks.
Novellus Systems, Inc. (NASDAQ: NVLS) Started as Overweight at JPMorgan.
NutriSystem Inc. (NASDAQ: NTRI) Started as Buy at Auriga.
Polo Ralph Lauren Corp. (NYSE: RL) Cut to Hold at Citigroup.
Teva Pharmaceutical Industries Limited (NASDAQ: TEVA) Started as Buy at Canaccord Genuity.
VeriFone Systems, Inc (NYSE: PAY) Started as Buy at Argus.
Warner Chilcott plc (NASDAQ: WCRX) Started as Buy at Canaccord Genuity.

JON C. OGG

Filed under: Analyst Calls Tagged: AAPL, CAT, CHTR, CL, CMA, CMCSA, DE, DTV, IFT, KMB, LRCX, MW, NTRI, NVLS, PAY, RL, TEVA, WCRX

August’s New Massive Stock Buybacks… Over $30 Billion (LOW, CVS, CELG, COV, INTU, DISCA, HRS, LMT, RSG, LOW, ABC, MXIM, ANR, AVT, JAH, LUV, STJ, ECL, IPG, FRX, ACE, CLF, CTSH, KBR, NWL, VRX, AKAM, AOL, DLB, URBN, ACM, CHTR, MYGN, PFG, HSIC)

Administrator — Wed, 31 Aug 2011 19:00:52 +0000

The pace of stock buyback announcements in the month of August was almost unbelievable. The pace was stronger at the start of the month when earnings were still coming in droves, but the number of newly announced buyback plans and the extended or expanded buyback plans remained high throughout the entire month. Many companies announce share buybacks and never spend much on the actual plan. Today, these companies are by and large actually living up to their promises. These are The August Buyback Kings….

We would normally group these alphabetically, but not today. We grouped these in order of size and then we used an alphabetic order when it came to the same size of a buyback announcement. The first group is the billions of dollars.

We then grouped the stocks by size again from the under $1 billion down to $500 million, and then we grouped the buybacks of under $500 million down to $200 million. Usually we would cut the list off at buybacks of the $100 million and higher but the list was already too big so we cut the Buyback Kings off at $200 million for August. Lastly, we have a chart at the very end tallying it all up…. Some $28.7 billion for just the $200 million and higher in new or expanded buyback announcements. There were literally dozens of other buybacks that were closer to the $100 million mark and many more that were less than that.

The $1 billion and higher alone which were announced in August were as follows: Lowe’s Companies, Inc. (NYSE: LOW); CVS Caremark Corporation (NYSE: CVS); Celgene Corporation (NASDAQ: CELG); Covidien plc (NYSE: COV); Intuit Inc. (NASDAQ: INTU); Discovery Communications, Inc. (NASDAQ: DISCA); Harris Corporation (NYSE: HRS); and Lockheed Martin Corporation (NYSE: LMT).

Filed under: Dividend, Shareholder Issues, Stock Buybacks Tagged: ABC, ACE, ACM, AKAM, ANR, AOL, AVT, CELG, CHTR, CLF, COV, CSCO, CTSH, CVS, CVX, DISCA, DLB, ECL, FRX, HRS, INTU, IPG, JAH, KBR, LMT, LOW, LUV, MXIM, MYGN, NWL, NWSA, PFG, RSG, STJ, URBN, VRX, XOM

CEOs Buying Their Own Companies At A Discount (NLY, CHTR, D, EQY, GBX, HUN, LEAP, LGND, MBRG, MS, TIE, WIN)

Administrator — Fri, 12 Aug 2011 19:49:46 +0000

Investors couldn’t have missed seeing the recent waves of new corporate share buyback plans. What they may have not noticed as clearly is the increasing trend in “legal insider trading” — when CEOs and corporate insiders are buying stock in the open market — now that shares have come so far off the highs. 24/7 Wall St has tracked some of the key insider trades in recent days, and the numbers are impressive.

Insiders may sell shares for a myriad of reasons that have nothing to do with the underlying fundamentals of a company. But when insiders buy shares of the company in the open market, it is almost certainly because they think the shares are undervalued or will rise in the future.

We therefore ignored the large acquisitions by a holding company or an activist. We aimed to identify the top insiders who bought shares in the open market, taking the action as a statement they think shares are cheap, or at least oversold. Some of these CEOs and Officers are already up huge on their purchases. Maybe they are on to something and understand how their companies will fare in this economy better than what overall market panic might indicate.

Companies Whose Own CEOs Are Now Buying:

Titanium Metals Corporation’s (NYSE: TIE) chairman Harold Simmons grabbed his checkbook to buy shares. Simmons spent some $8.2 million to buy 600,000 shares of common stock at a volume-weighted average price (VWAP) of $13.6492. Simmons owns millions of shares with his spouse and via other entities under his control. Other officer and insider purchases were recorded as well in recent days. Shares are back up to $14.85, and the 52-week range here is $13.80 to $22.93. TIE was an $18 stock as recently as August 2.

Equity One Inc. (NYSE: EQY) is a community shopping center REIT, and the Chairman, Chaim Katzman, has spent another $5.5 million or so on multiple days at multiple prices to buy shares. One day alone was a 215,168 share buy at a VWAP of $17.40, and other prices were below $17.00. Katzman now holds more than 52 million shares, and the price is back up above $17.50. The 52-week range is $15.07 to $20.27, and the REIT has a current dividend north of 5%. Keep in mind that the stock traded around $20 as recently as July 22.

Amphenol Corpration’s (NYSE: APH) chairman Martin Loeffler spent $4.99 million buying 115,300 shares of the cabling company on August 5 at a VWAP of $43.31. Shares are already back up to $46.75, and the 52-week trading range was $39.61 to $59.11. It is interesting to know that insiders were selling shares early in 2011 at prices closer to $55.00. The Chairman must think Amphenol has sold off too much.

Leap Wireless International Inc. (NASDAQ: LEAP) has been pounded of late, but chairman of the board Mark Rachesky bought shares under the “MHR” entities, where he effectively raised his stake by another 166,000 shares bought at a price of $7.1434 (VWAP), and took the stake to 25.9%. He previously purchased 500,000 shares at $6.46 for some $3.22 million. Shares are now at $7.65, and the 52-week range is $5.78 to $17.66. What matters here is that LEAP was a $10.00 stock as recently as August 3 and a $15.00 stock as recently as July 22 before the huge selling wave hit. Dr. Rachesky is the co-founder and president of MHR Fund Management LLC, which is an investment manager of various private investment funds.

Huntsman Corporation (NYSE: HUN) is a former buyout target that did not get acquired. It turns out the Huntsman family sees value here: Officers Peter Huntsman bought 100,000 shares at $11.37 for over $1.1 million, and Jon Huntsman bought 200,000 shares at $11.48 per share for proceeds of $2,296,000.00. Shares of this $3.3 billion chemical company are already back up at $13.93, and the 52-week trading range is $8.47 to $21.52.

Morgan Stanley’s (NYSE: MS) CEO James Gorman last week showed his conviction and confidence in the company … albeit a bit too early. Gorman spent more than $2 million in open market transactions for 100,000 shares at VWAP of $20.6207. The shares were purchased in multiple transactions at prices ranging from $20.555 to $20.73, and the date of the transaction is August 4. Morgan Stanley shares fell below $16.50 at the peak of the selling panic this week, but the stock is back up to $17.50. Gorman was making a statement, but he jumped in a bit too early — before the U.S. downgrade and before the E.U. bank mess.

Greenbrier Companies Inc. (NYSE: GBX) saw waves of insider buying from its president & CEO William Furman this week. He bought roughly 100,000 shares of stock at prices of $12.92 to $15.00. He now holds about 1.3 million shares. Greenbrier manufactures railroad car equipment as well as marine barges. The 52-week trading range is $9.10 to $30.38.

Charter Communications Inc. (NASDAQ: CHTR) is freshly under a share buyback plan now that it has emerged from Chapter 11. CFO Christopher Winfrey purchased some 25,000 shares at $46.02 for a total of about $1.15 million. Shares are back up to $47.50, and the 52-week trading range is $31.36 to $61.15. With the CFO buying shares as well as a $200 million share buyback plan, it seems the company may actually believe in its own worth.

Annaly Capital Management, Inc. (NYSE: NLY) is going to benefit from the new perpetually low rates courtesy of Ben Bernanke and for the fact that the debt ceiling issue is behind us. Kevin Keyes, chief strategic officer and head of capital markets, has decided that Annaly will be able to keep borrowing at next to nothing rates, and buying mortgage products so that the REIT can pay out 90% of its income for massive yields. He spent more than $850,000, buying 50,000 shares on August 8 at $17.13 VWAP. With this purchase, he doubled his stake in the company. Shares are back up to almost $18, and the 52-week trading range is $14.05 to $18.79. NLY one has a double-digit dividend yield at the current payout.

Dominion Resources, Inc. (NYSE: D), a producer and transporter of power, had a buy in window open up when five insiders acquired more than 15,000 shares in direct market purchases. The insiders included the CEO and CFO as well as as directors. They bought at share prices of $46.11 to $48.21. Shares are back up to $48.00, and the 52-week range is $41.13 to $50.45. Keep in mind that Dominion is a $27 billion company.

Windstream Corporation (NASDAQ: WIN), the rural telecommunications services provider acquiring Paetec Holdings Corp. (NASDAQ: PAET), has seen president & CEO Jeffery Gardner buy 17,800 shares along with VP Grant Raney. Chairman Dennis Foster bought 10,000 shares as well. The various purchases were a mix of ‘non open market’ and direct purchases at prices between $11.00 and $11.50. These same insiders had also made indirect and direct purchases of shares in May and June at prices closer to $13.00. What is interesting is that these insiders are growing shares during the midst of an acquisition of broadband provider Paetec for more than $700 million.

Middleburg Financial Corporation (NASDAQ: MBRG) is interesting, even if it might not seem the biggest buy in the world. Ousted Berkshire Hathaway executive David Sokol spent about $260,000 to buy 8,317 more shares of Middleburg at $14.56, and another 11,000 shares at $14.38. Sokol now has over 1.4 million shares, direct and indirect, and he has been thought of as a buyer of the banking and financial services company. MBRG trades only about 10,000 shares a day, and has a $101 million market cap. Its 52-week trading range is $13.33 to $19.00.

Ligand Pharmaceuticals Inc. (NASDAQ: LGND) may seem like a light purchase on the surface, but the purchase is after a period of real weakness, when shares fell from $13.50 to $11 before the recent market stabilization. Todd Davis, a director, bought 15,000 shares at a VWAP price of $10.90 in multiple transactions at prices ranging from $10.668 to $11.239. The transaction doubled his direct ownership stake of 29,201 shares. Another director, Jason Aryeh, bought 2,000 shares at $10.57, and another director, Sunil Patel, bought 5,000 shares at a VWAP of $10.74. The transaction was after earnings. The 52-week trading range of $8.14 to $14.80. Ligand also trades only about 133,000 shares a day, so this stood out more than many investors might have given it credit for.

JON C. OGG

Filed under: Insider Activity, Shareholder Issues, Stock Buybacks Tagged: CHTR, D, EQY, GBX, HUN, LEAP, LGND, MBRG, MS, NLY, TIE, WIN