24/7 Wall St. » MSSR

24/7 Wall St. Closing Bell (AIXG, AZN, HON, HUM, PAA, ALU, FTEK, IRDM, XIDE, WMS, JRCC, PKT, RJET, OPXA, DYN, TRGT, MSSR, SZYM)

Paul Ausick — Tue, 08 Nov 2011 21:07:29 +0000

Equities started the day with a solid move up, but lost momentum after about half an hour. The downward move lasted into the late morning, at which time stocks started a fitful climb back up. There was no big news to speak of, although the Italian prime minister lost a budget vote which may lead to vote of confidence in his leadership. Crude oil is up about $0.75/barrel and gold is up about $6.40/ounce, to near $1,800/ounce. Commodities are mostly higher as the dollar weakened. Stocks finished the day near session highs.

The unofficial closing bells put the DJIA up more than 101 points to 12,170.18 (0.84%), the NASDAQ rose more than 32 points (1.2%) to 2,727.49, and the S&P 500 rose 1.17% or more than 14 points to 1,275.93.

There were several analyst upgrades and downgrades today, including Aixtron SE (NASDAQ: AIXG), which we noted in our story on LED lighting this morning and was raised to ‘equal weight’ at Morgan Stanley. Other changes included AstraZeneca PLC (NYSE: AZN) cut to ‘underweight’ at Morgan Stanley; Honeywell International (NYSE: HON) raised to ‘buy’ at Citigroup; Humana Inc. (NYSE: HUM) reiterated as ‘buy’ and target price raised to $95 at Argus; Plains All-America Pipeline L.P. (NYSE: PAA) raised to ‘buy’ at Wells Fargo; and Alcatel-Lucent (NYSE: ALU) cut to ‘neutral’ at BofA/ML.

Here are today’s big post-earnings news reactions with prices during the last half-hour of trading: Fuel Tech, Inc. (NASDAQ: FTEK) is up about 22%, at $6.63; Iridium Communications Inc. (NASDAQ: IRDM) is up nearly 16%, at $7.34; Exide Technologies (NASDAQ: XIDE) is down more than -32%, at $3.04, after posting a new 52-week low of $2.98 earlier today; WMS Industries Inc. (NYSE: WMS) is down nearly -17%, at $18.25; James River Coal Corp. (NASDAQ: JRCC) is down nearly -9%, at $9.45; and Procera Networks, Inc. (AMEX: PKT) is up nearly 21%, at $14.31, after posting a new 52-week high earlier today of $14.38.

Several other standouts from today are as follows…

Republic Airways Holdings Inc. (NASDAQ: RJET) is up more than 57%, at $4.24. The company said that it is looking at selling or spinning off its Frontier Airlines unit.

Opexa Therapeutics, Inc. (NASDAQ: OPXA) is up nearly 33%, to $1.37. The company announced that its drug treatment for multiple sclerosis has received the Fast Track designation from the FDA.

Dynegy Inc. (NYSE: DYN) is up more than 28%, at $3.79. The utility company has said that several of its units have filed for bankruptcy. We covered the unusual bankruptcy boost in more detail earlier today.

Targacept, Inc. (NASDAQ: TRGT) is down nearly -59%, at $7.75, a new 52-week low. The company announced this morning that its anti-depressant drug failed a recent first phase trial.

McCormick & Schmick’s Seafood Restaurants Inc. (NASDAQ: MSSR) is up more than 27%, at $8.65. The company has accepted a buyout offer of $8.75/share in cash from Landry’s Inc.

Solazyme, Inc. (NASDAQ: SZYM) is up more than 17%, at $10.98. The company has signed tentative contracts for 90% of its feedstock through 2015. We covered potential upside in the biofuel sector earlier this week.

Stay tuned for Wednesday. Federal Reserve chairman Ben Bernanke is giving a speech in the morning and Federal Reserve governor Daniel Tarullo gives a speech in the afternoon. We have noted the following events (all times Eastern):

7:00 a.m. – Mortgage Bankers Association purchase applications
9:30 a.m. – Wholesale trade report
10:30 p.m. – EIA weekly petroleum status report
1:00 p.m. – US Treasury 10-year note auction

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AIXG, ALU, AZN, DYN, FTEK, HON, HUM, IRDM, JRCC, MSSR, OPXA, PAA, PKT, RJET, SZYM, TRGT, WMS, XIDE

Top Active Trader Alert Stocks (ATVI, ALLT, DRYS, MSSR, TRGT)

Mike Sauter — Tue, 08 Nov 2011 13:53:10 +0000

Active traders and day traders have many stocks to choose from this Tuesday morning. We are tracking news and moves in shares of Activision Blizzard (NASDAQ: ATVI), Allot Communications, Ltd. (NASDAQ: ALLT), DryShips, Inc. (NASDAQ: DRYS), McCormick & Schmick’s Seafood Restaurant (NASDAQ: MSSR), and Targacept, Inc. (NASDAQ: TRGT).

Activision Blizzard (NASDAQ: ATVI) is up nearly 3% premarket to $14.15, relative to a 52-week range of $10.40 – $13.75.

Allot Communications, Ltd. (NASDAQ: ALLT) is down 6.5% before market open to $14.29, relative to a 52-week range of $6.86-$19.15.

DryShips, Inc. (NASDAQ: DRYS) is up 6.25% before market open to $2.89, relative to a 52-week range of $1.75 – $6.44. The company posted slightly better earnings per share than expected.

McCormick & Schmick’s Seafood Restaurant (NASDAQ: MSSR) is up 28% premarket to $8.68, relative to a 52-week range of $5.43 – $10.47. Landry’s has announced it would buy the company for $136 million.

Targacept, Inc. (NASDAQ: TRGT) is down more than 55% before market open to $8.45, within a 52-week range of $14.42 – $30.47.

Filed under: Pre-Market Activity, Trading Alert Tagged: ALLT, ATVI, DRYS, MSSR, TRGT

M&A Watch: Do All Restaurant Chains End Up Private? (MSSR, MRT, RUTH, CAKE, PFCB, CPKI)

Administrator — Thu, 07 Apr 2011 17:05:40 +0000

Landry’s, Lone Star, Capital Grille, Outback, Smith & Wollensky, and on and on… How many public restaurant and dining chains can be taken private? Apparently many more. McCormick & Schmick’s Seafood Restaurants, Inc. (NASDAQ: MSSR) is under a tender, Morton’s Restaurant Group, Inc. (NYSE: MRT) is seeking a buyer, and we have a line-up of other casual dining or upscale dining chains which we think can join in the waves of public food chains that have gone private.

McCormick & Schmick’s Seafood Restaurants, Inc. (NASDAQ: MSSR) is currently the most recent of the upscale dining chains that has an offer to go private. The offer comes from Landry’s via Fertitta for $9.25 per share and the stock is trading higher than the proposed offer. The 52-week trading range is $6.14 to $11.98, so the thought is that shareholders will demand a higher price. At $9.45, this company’s market cap is only $140 million against 2010 sales of $351 million. As a reminder, this was a $20.00 to $25.00 stock back in 2006 to 2007.

It was less than a month ago that Morton’s Restaurant Group, Inc. (NYSE: MRT) announced a strategic alternatives exploration which could involve a sale. By the way, ‘strategic alternatives’ almost always translates to “looking for a buyer.” This stock is at $7.50 today and it traded from $6.44 up to $7.20 when it made this announcement. The upscale steakhouse has a current value of $120 million against $296 million in 2010 sales.

But what about other chain restaurants? Our view is that any of these chains could be ‘go-private’ candidates at any point. Many management teams have grown very tired of living by a monthly or quarterly benchmark of same-store sales growth. We have identified several others we think can easily be taken private in the months or years ahead. The only caveat is a simple one: these management teams and corporate insiders will have to want to go private. Here are a few other dining chains to possibly consider.

Ruth’s Hospitality Group Inc. (NASDAQ: RUTH)… Great steaks, hot steak ovens, upscale, and worth one-quarter of its 2005 to 2006 post-IPO peak. It has a loyal customer base (even if the Houston Ruth’s needs a major face lift) because of great steaks and its $170 million valuation offers much room for a buyer to milk more money out of the model whether a buyer would want to grow the chain count or not. Sales in 2010 were $357.6 million. At $5.20, its 52-week range is $3.15 to $6.60.

The Cheesecake Factory Incorporated (NASDAQ: CAKE)… Great continental food under flagship brand and under Grand Lux. Valuation is always a concern here at $1.75 billion in market cap against $1.66 billion in 2010 sales. The price tag may drive away buyers, but the way to milk more money out of this one boils down to a buyer simply cutting the portion sizes by a fraction. At a share price of $29.69, its 52-week range is $21.56 to $34.00.

P.F. Chang’s China Bistro. Inc. (NASDAQ: PFCB)… Great upscale Chinese or Asian-fusion at flagship brand and more casual and takeout venue of Pei Wei, with the latter having more growth opportunities. The market cap is $1.08 billion and 2010 sales were $1.24 billion. With shares at $46.20, its 52-week range is $37.36 to $53.39. This one now targets roughly 40% of its income to be paid out in dividends.

California Pizza Kitchen Inc. (NASDAQ: CPKI)… Upscale pizza? This one was supposedly going private before, yet here is still public. It has a market value of about $400 million and 2010 sales were $642 million. At $16.35, its 52-week trading range is $12.95 to $22.92.

You have noticed that no buyout targets have been offered up. For any of these to be taken private it will require that management wants to go private. Having a cheap stock might not matter in the slightest. All of these offer at least some of what private equity seeks… Premium products in premium locations, creating at least a partial barrier to entry, with cash flows. All of these models can be leveraged some and can probably be milked for more cash flow if they were private. A private equity buyer often may treat any restaurant chain more like a cash flow monster than it does a giant growth engine. After all, there are only so many locations that a single concept can support.

High-end pizza, high-end Chinese, high-end continental, high-end anything… even relatively upscale can work. If these kick off major cash flows for a private equity investor, all that matters is that they kick off enough consistent cash flow that they can be leveraged up and/or sold off at a higher price to a different buyer down the road while they are busy kicking off cash today.

Just because we believe these can be targets down the road does not mean they will all become targets. At the end of the day, value is in the eye of the beholder.

JON C. OGG

Filed under: Food, Mergers and Buy Outs, Private Equity, Retail Tagged: CAKE, CPKI, MRT, MSSR, PFCB, RUTH

Top Analyst Upgrades (ARLP, MDRX, FDO, GFI, LOW, MSSR, MDR, TASR)

247wallst — Fri, 06 Mar 2009 12:39:52 +0000

These are the top upgrades and positive calls we have seen from analysts on Wall Street this Friday morning:

Alliance Resource (ARLP) Raised to Buy at Citigroup.
Allscripts-Misys Healthcare (MDRX) Started as Outperform at Morgan Keegan.
Family Dollar (FDO) Raised to Neutral at JPMorgan.
Gold Fields (GFI) Raised to Overweight at JPMorgan.
Lowe’s (LOW) Raised To Outperform at FBR.
McCormick & Schmick’s (MSSR) Raised to Outperform at Oppenheimer.
McDermott (MDR) Raised to Buy at Jefferies.
TASER (TASR) Raised to Buy at Merriman Curhan Ford.

JON C. OGG

Posted in Analyst Calls Tagged: ARLP, FDO, GFI, LOW, MDR, MDRX, MSSR, TASR

Analyst Downgrade Onslaught Continues (ASML, CMG, FORM, GFIG, ICE, KLAC, MSSR, MPEL, MRG, PEET, PRXI, PHM, RGLD, JAVA, TCK, TER, UDR, VNO)

247wallst — Thu, 08 Jan 2009 07:29:54 +0000

This morning was a shocker on just how many analyst downgrades and very negative calls were out from Wall Street analysts. The sad part is this is only part of the onslaught that we are still seeing.

ASML (NASDAQ: ASML) Cut to Market Perform at FBR.
Chipotle (NYSE: CMG) Cut to Neutral at Piper Jaffray.
FormFactor (NASDAQ: FORM) Cut to Market Perform at FBR.
GFI Group (NASDAQ: GFIG) Cut to Hold at Deutsche Bank.
IntercontinentalExchange (NYSE: ICE) Cut to Hold at Deutsche Bank.
KLA-Tencor (NASDAQ: KLAC) Cut to Market Perform at FBR.
McCormick & Schmick’s (NASDAQ: MSSR) Cut to Neutral at Piper Jaffray.
Melco Crown (NASDAQ: MPEL) Cut to Hold at Deutsche Bank.
Morton’s Restaurant Group (NYSE: MRG) Cut to Neutral at Piper Jaffray.
Peet’s Coffee & Tea (NASDAQ: PEET) Cut to Neutral at Piper Jaffray.
Premier Exhibitions (NASDAQ: PRXI) Cut to Neutral at Merriman Curhan Ford.
Pulte Homes (NYSE: PHM) Cut to Neutral at JPMorgan.
Royal Gold (NASDAQ: RGLD) Cut to Sector Underperform at CIBC.
Sun Microsystems (NASDAQ: JAVA) Cut to Sell from Neutral at Goldman Sachs (added details).
Teck (NYSE: TCK) Cut to Neutral at UBS.
Teradyne (NYSE: TER) Cut to Market Perform at FBR.
UDR Inc. (NYSE: UDR) Cut to Sell at Goldman Sachs.
Vornado (NYSE: VNO) Cut to Neutral at Goldman Sachs.

Jon C. Ogg
January 8, 2009

Posted in Analyst Calls Tagged: ASML, CMG, FORM, GFIG, ICE, JAVA, KLAC, MPEL, MRG, MSSR, PEET, PHM, PRXI, RGLD, TCK, TER, UDR, VNO

Early Bird Analyst Upgrades (ALVR, ABV, ABC, NITE, MSSR, NDAQ, PCX, TRMB)

247wallst — Wed, 24 Sep 2008 06:23:56 +0000

These are some of the analyst upgrades and positive calls coming from Wall Street this Wednesday morning with more than two hours to the open:

Alvarion (ALVR) Started as Buy at Deutsche Bank.
AmBev (ABV) Raised to Outperform at Credit Suisse.
AmerisourceBergen (ABC) Raised To Buy at Merrill Lynch.
Knight Capital (NITE) Raised to Buy at Goldman Sachs.
McCormick & Schmick’s (MSSR) Started as Buy at Jefferies.
Nasdaq OMX (NDAQ) Raised To Buy at Goldman Sachs.
Patriot Coal (PCX) Started as Buy at UBS.
Trimble Navigation (TRMB) Started as Buy at Deutsche Bank.

Jon C. Ogg
September 24, 2008

Posted in Analyst Calls Tagged: ABC, ABV, ALVR, MSSR, NDAW, NITE, PCX, TRMB

52-Week Low Club (CC, DBD, FIC, GTOP, IMB, MSSR, RECN, MU, RT, STI)

247wallst — Fri, 21 Dec 2007 16:01:00 +0000

Some of these recovered off lows but here are some of the more active stocks that hit 52-week lows today:

Circuit City (NYSE: CC)… after posting wider losses and then forecasting a loss next quarter. Even losers like them, how does a retailer lose money over Christmas????
Diebold (NYSE: DBD) hit a new 52-week low on a "continuing dialog" with Office of The Chief Accountant and a D.O.J. investigation into related matters.
Fair Isaac (NYSE: FIC) people keep asking us if FIC is the next implosion in being tied to system-wide credit woes.
Genitope (NASDAQ:GTOP) hit the FUBAR button after failing to meet endpoints in PHASE III. With no revenues it’s close to biotech zombie status.
IndyMac Bancorp (NYSE:IMB) recovered but its subprime woes remain.
McCormick & Schmicks (NASDAQ:MSSR)… steakhouse sales soft in weak consumer economy. Don’t you think the private equity firms wish they could sell those steakhouses back now????
Resource Connection (NASDAQ:RECN)… too few resources? Nope, it gave employees an extra week off of paid vacation. Those employees are some lucky SOB’s for that, but shareholders "NOT SO MUCH!!!"
Micron Tech (NYSE: MU) after a piss poor earnings report. Trivia Question: Is there a worse technology business than DRAM? It’s just like trading a commodity except the prices never seem to go up!
Ruby Tuesday (NYSE:RT) after a downgrade and an earnings warning, mid-level restaurant spending is weak and they don’t offer very much special.
SunTrust (NYSE:STI) weak again. Maybe Buffett wishes he stayed away.

Jon C. Ogg
December 21, 2007

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Short Sellers Lighten Up On Growth Restaurant Chains (RRGB, PZZA, MSSR, BWLD, SBUX, CAKE, TXRH, CBRL, PFCB, PNRA)

247wallst — Wed, 26 Sep 2007 09:01:47 +0000

We’ve started seeing some of the recent emptier pockets of Joe Q. Consumer, and after a warning yesterday out of McCormick & Schmicks’s we wanted to see how some of the NASDAQ growth restaurant chains were doing as far as short sellers were concerned. Interstingly enough, of the ones we look at with regularity that get media coverage it seems like there is actually a drop in short selling from August to September. Below is a list of companies in the sector along with the shares short in September and a percentage change from the August count of the short interest:

Red Robin Gourmet (RRGB) 3.304M -1.13%
Papa John’s (PZZA) 2.245M -2.91%
McCormick & Schmick’s (MSSR) 1.497M -6.22%
Buffalo Wild Wings (BWLD) 3.293M -6.4%
Starbucks (SBUX) 25.725M -6.98%
Cheesecake factory (CAKE) 11.636M -7.55%
Texas Roadhouse (TXRH) 7.066M -7.93%
CBRL Group (CBRL) 4.727M -14.92%
P.F.Chang’s (PFCB) 7.051M +2.54%
Panera Bread (PNRA) 4.688M +7.91%

Here are some key related articles that may give added insight:

Jon C. Ogg
September 26, 2007