The unofficial closing bells put the DJIA down more than -389 points to 11,780.94 (-3.2%), the NASDAQ fell nearly -106 points (-3.88%) to 2,621.65, and the S&P 500 fell -3.67% or nearly -47 points to 1,229.10.

There were several analyst upgrades and downgrades today, including DreamWorks Animation SKG Inc. (NYSE: DWA) cut to ‘sell’ at Janney; H&R Block, Inc. (NYSE: HRB) raised to ‘outperform’ at Oppenheimer; Priceline.com Inc. (NASDAQ: PCLN) cut to ‘hold’ at S&P Capital IQ; Rite Aid Corporation (NYSE: RAD) raised to ‘outperform’ at Credit Suisse; Walgreen Co. (NYSE: WAG) cut to ‘neutral’ at Credit Suisse; and Autodesk Inc. (NASDAQ: ADSK) cut to ‘neutral’ at BofA/ML.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: General Motors Co. (NYSE: GM) is up down about -10%, at $22.48; A123 Systems Inc. (NASDAQ: AONE) is down less than -1%, at $3.09; IntraLinks Holdings, Inc. (NYSE: IL) is down more than -37%, at $5.50, after posting a new 52-week low of $5.44 earlier today; Blue Nile Inc. (NASDAQ: NILE) is down nearly -16%, at $33.24; Harvest Natural Resources Inc. (NYSE: HNR) is down more than -19%, at $8.80; and Neenah Paper, Inc. (NYSE: NP) is up more than 12%, at $18.84.

Several other standouts from today are as follows…

Energy Conversion Devices, Inc. (NASDAQ: ENER) is down more than -32%, to $0.41. The company has said that it will suspend manufacturing and cut 500 jobs. Excess inventory of solar panels gets the blame.

U.S. Auto Parts Network, Inc. (NASDAQ: PRTS)  is down  more than -22%, at $3.94, after posting a new 52-week low of $3.66 earlier in the day. The company received a waiver from one of its lenders for failing to meet coverage ratio requirements.

O’Reilly Automotive, Inc. (NASDAQ: ORLY) is down about -1.1%, at $76.44, after posting a new 52-week high of $77.95 earlier today. We noted the company’s performance earlier today in an article on auto sector implied gains.

American Superconductor Corp. (NASDAQ: AMSC)) is up nearly 10%, to $4.49. The company reported earnings today, and its growing order backlog indicates a possible turnaround following the loss of its biggest customer earlier this year.

Noranda Aluminum Holding Corp. (NYSE: NOR) is down more than -16%, at $8.51. The company will pay a special dividend of $1/share to shareholders of record as of yesterday’s close. That pushed the shares down a buck this morning, and the rest is due to the overall market decline today.

Citigroup (NYSE: C) is down more than -8%, at $28.78. The bank claimed the largest decline among the big US banks today.

Beazer Homes USA Inc. (NYSE: BZH) is down nearly -8%, at $2.17. There was no special news from Beazer today, but the threatened burst of new foreclosures soon to hit the housing market have had a nasty effect on this lower-priced builder.

Stay tuned for Thursday. Atlanta Federal Reserve Bank president Dennis Lockhart is giving a speech in the morning and Federal Reserve chairman Ben Bernanke will hold a town hall meeting with soldiers and their families at Fort Bliss, Texas, at 11:45 a.m. We have noted the following events (all times Eastern):

• 8:30 a.m. – International trade balance report
• 8:30 a.m. – Initial unemployment benefits claims
• 8:30 a.m. – Monthly import/export price report
• 9:45 a.m. – Bloomberg consumer comfort index
• 10:30 a.m. – EIA natural gas inventory report
• 2:00 p.m. – Monthly US Treasury budget report
• 4:30 p.m. – Federal Reserve balance sheet and money supply report

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Paul Ausick

Alaska Communications Systems Group Inc. (NASDAQ: ALSK) Cut to Underperform at BofA/ML.
Autodesk Inc. (NASDAQ: ADSK) Cut to Neutral at BofA/ML.
Avon Products, Inc. (NYSE: AVP) cut to Underperform as Bear of the Day at Zacks.
Blue Nile Inc. (NASDAQ: NILE) Cut to Sell at Deutsche Bank.
China Automotive Systems Inc. (NASDAQ: CAAS) Cut to Neutral at Piper Jaffray.
DreamWorks Animation SKG Inc. (NYSE: DWA) Cut to Sell at Janney.
Equity Residential (NYSE: EQR) Raised to Buy at Argus.
H&R Block, Inc. (NYSE: HRB) Raised to Outperform at Oppenheimer.
Priceline.com Inc. (NASDAQ: PCLN) Cut to Hold at S&P Capital IQ (late-Tuesday).
Rite Aid Corporation (NYSE: RAD) Raised to Outperform at Credit Suisse.
Rovi Corporation (NASDAQ: ROVI) has seen at least three downgrades: Collins Stewart, CLSA, Brean Murray.
Spectrum Pharmaceuticals, Inc. (NASDAQ: SPPI) named Momentum stock of the day at Zacks.
Textainer Group Holdings Limited (NYSE: TGH) named Value stock of the day at Zacks.
Walgreen Co. (NYSE: WAG) Cut to Neutral at Credit Suisse.
The Washington Post Co. (NYSE: WPO) named Bull of the Day at Zacks.

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JON C. OGG

MetroPCS did not fare as well. The company reported EPS of $0.19 on revenue of $1.2 billion. Consensus estimates called for EPS of $0.23 and revenue of $1.22 billion. The company added 69,000 new customers in the quarter, a big drop from the 199,000 it added in the second quarter.

The challenge from Sprint Nextel Corp. (NYSE: S) and T-Mobile in the pre-paid market hurt MetroPCS’s revenues and earnings. This does not help the AT&T/T-Mobile plan to sell off some assets to other carriers as the two companies try to get their proposed merger through the regulatory process. MetroPCS was viewed as a possible buyer of those assets, but lower customer additions and lower profits are not usually conducive to expansion plans.

Sprint has no interest in buying any assets that AT&T/T-Mobile want to shed. The number three US carrier has fought the proposed merger every step of the way. Verizon Wireless, the joint venture between Verizon Communications Inc. (NYSE: VZ) and Vodafone plc (NASDAQ: VOD), has had essentially no comment on the proposed merger, but certainly has little to gain from a tie-up between AT&T and T-Mobile.

The US Justice Department’s suit to stop the merger got a boost yesterday when a federal court prevented H&R Block, Inc. (NYSE: HRB) from buying low-cost tax preparer TaxAct, citing anti-trust violations. The deal was worth less than $300 million but the Justice Department argued that the merger would leave just two tax-prep firms, Block and Intuit Inc. (NASDAQ: INTU). Similarly, the AT&T deal would leave just one behemoth, AT&T, while Verizon Wireless would fall to a distant second place and be virtually forced to acquire Sprint in order to stay competitive.

The inability or unwillingness of another company to pick up AT&T/T-Mobile assets, coupled with the Block ruling, could be the beginning of the end for the proposed merger.

MetroPCS shares are down more than -7% this morning at $7.89, after posting a new 52-week low of $7.58. Leap Wireless is faring better, up more than 16%, at $8.09, in a 52-week range of $5.50-$17.66.

Paul Ausick

The pact is only a month out as the plan calls for these services at Kiosks starting in December.  What will seem ironic is that H&R Block noted some 11,000 offices in its press release, so this will not even add 3% to the total locations. 

Some expansion moves make sense.  This might be a good way for H&R Block to get its name out there in more locations and to recruit new clients, but a professional and financial services firm is taking a risk by going inside Wal-Mart.  If Wal-Mart’s current labor criticisms grow then the companies doing business with Wal-Mart will start to come under fire as well.

Intuit Inc. (NASDAQ: INTU) currently sells its TurboTax, Quicken, and QuickBooks software packages at Wal-Mart.  It would be unlikely for that to end.

Hopefully Wal-Mart won’t open up kiosks for divorce and personal injury lawyers as well.

JON C. OGG

Be advised that many earnings estimates have not been updated in days and some of these estimates may have already changed.

Tuesday, August 30

Barnes and Noble Inc. (NYSE: BKS) has very few estimates but the company is now under a shadow since it lost Liberty as a bidder even if it got an investment from it. Shares are trading around $ 11.40; the 52-week trading range is $8.45 to $21.06.

China Finance Online Co Ltd. (NASDAQ: JRJC) has too few estimates to count but we are going to watch because the financial information provider is under the China cloud.  Shares are trading around $2.84; the 52-week trading range is $2.35 to $8.59.

Dollar General Corp. (NYSE: DG) has estimates of $0.47 EPS and $3.54 billion in revenues.  Shares are trading around $33.50 and the 52-week trading range is $26.64 to $35.09.  We love this one long-term, but always keep in mind that private equity sellers are an overhang any time the price rises too much.

DryShips Inc. (NASDAQ: DRYS) has estimates of $0.22 EPS; shares are around $3.08 and the year’s range is $2.19 to $6.44.  Shares were up double-digits on Monday as it announced the exchange offer of shares by Ocean Rig UDW.

Wednesday, August 31

Fresh Market Inc. (NASDAQ: TFM) has estimates of $0.20 EPS and $273.9 million in revenues.  Shares are trading around $34.95, the 52-week trading range is $30.86 to $46.85.

Zale Corp. (NYSE: ZLC) has to be looked at after Tiffany beat so well last week.  It has estimates of -$1.53 EPS and $336.65 million in revenues.  Shares are trading around $4.75, the 52-week trading range is $1.50 to $6.90.

Thursday, September 1

Ciena Corporation (NASDAQ: CIEN) has been a poor performer in the tech selling and it should be assumed that its outlook will be weak if its peers are any indication.  The communications equipment maker has estimates of -$0.21 EPS and $443.3 million in revenues.  Shares are trading around $12.10 and the 52-week trading range is $10.33 to $29.24.

Finisar Corporation (NASDAQ: FNSR) has also been battered with tech stocks.  It has estimates of $0.21 EPS and $228.3 million. Shares are trading around $18.08, and the 52-week trading range is $12.26 to $46.09.

H & R Block Inc. (NYSE: HRB) has estimates of -$0.39 EPS and $275.1 million in revenues.  Shares are trading around $14.95 and the 52-week trading range is $10.13 to $18.00.

Jos A Bank Clothiers Inc. (NASDAQ: JOSB) is very thinly covered but it almost always has a large short interest.  The clothier has estimates of $0.67 EPS and $209.7 million in revenues.  Shares are trading around $45.99 and the 52-week trading range is $36.41 to $57.14.

Friday, September 2

Campbell Soup Co. (NYSE: CPB) has estimates of $0.37 EPS EPS and $1.57 billion in revenues. Shares are trading around $31.70, the 52-week trading range is $29.69 to $37.59.

Teavana Holdings Inc. (NYSE: TEA) is one that we do not have the research quiet period wrapped up yet but the company will give its first earnings report.  At $23.90, the recent post-IPO range is $20.28 to $29.35.

JON C. OGG

We have given a detailed preview on each, shown effective price data, and added in color if applicable.  It is amazing to see this many companies with earnings due.

Renren Inc, (NYSE: RENN) has been a pig of an IPO and we will get to see if this is just another China bash or if there is anything real under the hood on Monday.  Thomson Reuters has no estimates yet. Shares are trading around $6.92 and the 52-week trading range is $6.55 to $24.00.  Renren was touted as “The Facebook of China” but its stock and the scandal from right before the earnings turned it into “The Face$%^& of China.”

Adobe Systems Inc. (NASDAQ: ADBE) reports Tuesday and Thomson Reuters has estimates of $0.51 EPS and $994.79 million in revenues; next quarter estimates are $0.54 EPS and $1.02 million in revenues.  Shares are trading around $30.67 and the 52-week trading range is $25.45 to $35.99.

Barnes and Noble Inc. (NYSE: BKS) is interesting considering that it is at a premium to its implied buyout price.  Thomson Reuters has estimates of -$0.91 EPS and $1.39 billion in revenues; next quarter estimates are -$0.88 EPS and $1.45 billion in revenues.  Shares are trading around $20.00 and the 52-week trading range is $8.45 to $20.46.

Yahoo! (NASDAQ: YHOO) fell after China internet company Alibaba sold a controlling interest in its Alipay online payment operations to the parent company’s founder. Yahoo! owns 43% of Alibaba and the market’s perception is that its position was devalued by the Ailipay transaction.

Citigroup (NYSE: C) finally reverse split its stock 10-for-1. The market was not fooled by the new “higher” stock price and punished shares because the transaction reminded Wall St. that the split did nothing to help the bank’s weak position among large global financial firms.

Goldman Sachs was downgraded by renegade bank analyst Richard Bove of Rochdale downgraded the stock

Two home builders, Pulte and Lennar, sold off as news about the American housing market worsened.

Shares in Starbucks rose sharply as it set a distribution deal with Green Mountain Coffee Roasters (NASDAQ: GMCR). GMCR shares rose as much as 40%. Western Digital moved up as it bought the Hitachi’s Global Storage for $3.4 billion.

Sprint-Nextel (NYSE: S) traded up as the media reported a potential merger with No.4 US wireless carrier T-Mobile. Sprint will not be able to compete on its own against AT&T Wireless and Verizon Wireless on its own.

Douglas A. McIntyre

This morning we saw some data out of Credit Suisse that quantified some of the changes in digital reports here.  The total digital units for H&R Block rose by more than 7% on a year over year basis, while Intuit had closer to a 1% gain in total digital units.  Using the most recent updates, H&R Block’s online units were up over 27% versus about 6% for Intuit.  Credit Suisse noted that this was a 300 basis-point share improvement from H&R Block against Intuit.

Credit Suisse also noted that new online clients (excluding FFA) grew 46.2%, another suggestion that H&R Block is taking share.  Not all of the findings were bad for Intuit as the research noted that the Street expects upside to Intuit’s Consumer Tax guidance, but the firm warned that these results could show some potential risks to Intuit’s Consumer Tax revenue guidance of 10% to 13%.

What has changed? It seems that the online marketing of H&R Block and the free promotions are allowing it to take market share and have higher conversion rates.

There may be more than meets the eye here and there are some obvious caveats. Intuit recently faced some IRS delays that were disclosed at the start of the year.  The other caveat is that the year-to-date tax season is really only about half-way through, and that leaves much time for this to change.

Another issue to consider would be share prices versus 52-week highs.  H&R Block is up over 1% at $14.40 this morning in early indications but the 52-week trading range is $10.13 to $18.99 versus Intuit’s price of $52.00 and 52-week range of $31.71 to $54.68.

JON C. OGG

According to an analysis by 24/7 Wall St., analysts expect the shares of 9 out of the 10 members of the Worst to actually appreciate.  The expected increases can be significant.   Whether the potential risk outweighs the potential reward is up to an individual investor to decide.  There are some issues to consider before deciding whether to “adopt” these mutts for your portfolio.

For instance, stocks are sometimes cheap for a very good reason such as the CEO being under federal investigation or if a competitor is gaining market share at their expense or if customers are being maimed by their main product.  Wall Street conventional wisdom oftentimes is wrong.  That’s what makes it so conventional. Also, remember when someone asks whether a stock can go lower, the answer is always “of course.”

Data for the list below comes from Capital IQ. Share prices are year-to-date as of December 2.

1.) Dean Food Inc.  (NYSE:DF) — Down 59.6%

• Currently trades at about $7.44 with a mean price target of $9.44;
• Bad News:  Last week, Fitch downgraded the debt of the milk producer further into junk territory because of “higher than expected declines in earnings and cash flow and the expectation leverage will remain elevated through 2011,” Dow Jones says;
• Good News:  The stock appears cheap on a number on a number of metrics including price-to-earnings ratio.

2.) Weyerhaeuser Co.  (NYSE:WY) — Down 59.3%

• Currently trades at about $17.21 with a mean price target of $19.62;
• Bad News: The lumber producer is expected to benefit from the housing boom which has not happened yet. Stock is a favorite of short-sellers. UBS recently cut its rating from “buy” to “neutral.”;
• Good News:  Jim Cramer, among others, believes that the sell-off is overdone.  Third Avenue Management has recently added to its position.

3.) Apollo Group Inc.  (NYSE:APOL) — Down 41.6%

• Currently trades at about $38.15 with a mean price target of $49.87;
• Bad News:  The operator of the for-profit University of Phoenix faces heightened regulatory scrutiny.  Earlier this month, the company eliminated 700 jobs at the University of Phoenix. Apollo recently predicted that student enrollment will fall 40%;
• Good News:  For-profit college operators have launched a PR campaign to counter the government crackdown.

Read More: Ethanol Producers On Track For More Tax Credits (ADM, VLO, PEIX).

4.) H&R Block Inc.   (NYSE:HRB)  — Down 40.9%

• Currently trades  at about $12.70 with a mean price target of $18.80.;
• Bad News:   More people continue to prepare their taxes on their own.;
  The company is in a legal battle with the US division of HSBC Holdings PLC  to force the bank to provide the controversial Refund Anticipation Loans;
• Good News:  H&R recently reported better-than-expected quarterly results, a sign that the company’s cost cutting is working. Rival Jackson-Hewitt faces severe financial problems as well.

5.)  AK Steel Holdings Corp.  (NYSE: AKS) — Down 35.2%

• Currently trades at about $14.13 with a mean price target of $13.92
• Bad News: It is the only company on the list with no expected upside surprise.  The reason is obvious. “…a stubbornly reluctant economic recovery and soaring raw material costs will continue to challenge us in the near term,”CEO James L. Wainscott said in the last earnings press release.
• Good News:  Demand for steel should rebound as the economy recovers.

Filed under: Corporate Governance, General, Index, Management Change, Research, Shareholder Issues Tagged: AKS, APOL, DF, DO, GT, HRB, ODP, PHM, SVU, WY ]]> http://247wallst.com/2010/12/09/the-scum-of-the-sp-how-investors-can-profit-from-their-redemption/feed/ 0 AKSAPOLDFDOGTHRBODPPHMSVUWY 247wallst Lipstick On A Pig