24/7 Wall St. » TIF

24/7 Wall St. Closing Bell — May 24, 2012 (HPQ, ARMH, DUK, NOV, MET, FRED, HNZ, TIF, COST, TD, CRMT, MENT, POST, FRO, JDAS, NTAP, ROSG, P)

Paul Ausick — Thu, 24 May 2012 20:05:29 +0000

The three major US stock indexes opened lower this morning following a weak report on Chinese and German PMI readings (our coverage here and here). New US jobless benefits claims came in pretty much as expected and Kansas City Fed manufacturing data significantly beat estimates. Tech stocks soured the Nasdaq today and weighed on the other indexes as well. The US dollar index rose today, now up 0.27% at 82.318. The GSCI commodity index is down about 2% at 625.52, with commodities prices mixed. WTI crude oil closed up 0.9% at $90.66/barrel, staunching a two-day slide, and Brent crude trades up 0.92% at $106.53/barrel. Natural gas fell -3.3% today to $2.647/thousand cubic feet, following another inventory build (our coverage here). Gold settled up 0.6% today, at $1,557.60/ounce.

The unofficial closing bells put the DJIA up nearly 34 points to 12,530.91 (0.27%), the NASDAQ fell nearly 11points (-0.38%) to 2,839.38, and the S&P 500 rose 0.14% or nearly 2 points to 1,320.73.

There were several analyst upgrades and downgrades today, including Hewlett-Packard Co. (NYSE: HPQ) maintained as ‘neutral’ but estimates raised at Credit Suisse; ARM Holdings plc (NASDAQ: ARMH) raised to ‘buy’ at S&P; Duke Energy Corp. (NYSE: DUK) raised to ‘buy’ at UBS; National Oilwell Varco (NYSE: NOV) raised to ‘buy’ at SocGen; and MetLife Inc. (NYSE: MET) raised to ‘buy’ with a target price of $46 at Argus.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Hewlett-Packard is up 3% at $21.72 (more coverage here); Fred’s Inc. (NASDAQ: FRED) is down -2.5% at $14.05; H.J. Heinz Co. (NYSE: HNZ) is down -0.8% at $53.41; Tiffany & Co. (NYSE: TIF) is down -7.5% at $57.17 after posting a new 52-week low of $55.75 earlier today (more coverage here); Costco Wholesale Corp. (NASDAQ: COST) is up 1% at $84.16 (more coverage here); and The Toronto-Dominion Bank (NYSE: TD) is down -0.3% at $76.54.

Tomorrow we are scheduled to get earnings reports from America’s Car-Mart Inc. (NASDAQ: CRMT), Mentor Graphics Inc. (NASDAQ: MENT), Post Holdings Inc. (NYSE: POST), Frontline Ltd. (NYSE: FRO), and JDA Software Group Inc. (NASDAQ: JDAS).

We’ve also reviewed some potential value stocks among major oil companies, gold & silver miners, conglomerates, industrials, retail, and semiconductor stocks.

Other standouts from today include the following stocks:

Rosetta Genomics Inc. (NASDAQ: ROSG) is up nearly 52% at $17.07. The medical device maker is still booming on last week’s announcement that treatment would be covered by Medicare.

Pandora Media Inc. (NYSE: P) is up 12.5% at $11.62. The Internet radio company reported better-than-expected results last night. More coverage here.

Stay tuned for Friday. Philadelphia Fed President Charles Plosser is giving a speech. We have also noted the following events on the schedule (all times Eastern):

9:55 a.m. – Reuters/University of Michigan consumer sentiment index

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: ARMH, COST, CRMT, DUK, FRED, FRO, HNZ, HPQ, JDAS, MENT, MET, NOV, NTAP, P, POST, ROSG, TD, TIF

Tiffany Lags, Expects More of the Same

Paul Ausick — Thu, 24 May 2012 12:06:27 +0000

Luxury jewelry retailer Tiffany & Co. (NYSE: TIF) reported first quarter earnings this morning that were a light even though revenues were better than expected. The company posted EPS of $0.64 compared with a consensus estimate of $0.69. Revenue totaled $819 million versus an estimate of $817 million. The stock is getting slashed in the pre-market, though, based on the company’s revised guidance.

Tiffany now expects revenue growth for the full year to be 7%-8% rather than the previously forecast 10%. Operating margins are expected to be “modestly below” 2011 margins, and EPS is expected to come in at $3.70-$3.80, compared with a previous estimate of $3.95-$4.05. The consensus analyst estimate for full-year EPS had been $3.97.

The company is also adding to its debt, which rose from $687 million in the first quarter of 2011 to $834 million this year. Cash and cash equivalents and short-term investments totaled $343 million, compared with $622 million a year ago. This year’s debt load is equal to 35% of total shareholder equity, up from 30% a year ago.

Tiffany plans to open 24 new stores in 2012, to spend $240 million on capital improvements, and recently increased its dividend. The company’s stock buyback program spent $46 million in the first quarter and another $171 million remains in the program through January 2013. If Tiffany plans to spend at its current rate, debt will continue to grow as cash flows are not likely to keep up.

In pre-market trading this morning, Tiffany’s shares are down about -7% at $57.50 in a 52-week range of $56.21-$84.49.

Paul Ausick

Filed under: Earnings, Luxury Tagged: TIF

24/7 Wall St. Closing Bell — May 23, 2012 (FB, PCX, BX, AMAT, DELL, AEO, BIG, HRL, STP, TSL, FRED, HNZ, MMYT, TIF, TD, COST, PETM, STX)

Paul Ausick — Wed, 23 May 2012 20:05:55 +0000

The three major US stock indexes opened lower this morning after European leaders disagree on a fiscal response to the continent’s debt crisis(our coverage here). New US home sales were slightly above the consensus estimate, but made little difference in the slide. As the day wore on, more bad news from Europe sent crude oil prices tumbling and the dollar rising in the currency markets (our coverage here). The US dollar index rose today, now up 0.76% at 82.115. The GSCI commodity index is down fractionally at 628.23, with commodities mostly lower on the stronger dollar. Orange juice, cocoa, and cotton were today’s big losers. WTI crude oil closed down -2.1% at $89.90/barrel, its lowest settlement since October, and Brent crude trades down -2.51% at $105.69/barrel. Natural gas rose just 0.52% today to $2.72/thousand cubic feet. Gold settled down -1.8% today, at $1,548.40/ounce.

The unofficial closing bells put the DJIA down nearly 7 points to 12,496.07 (-0.05%), the NASDAQ rose about 11 points (0.39%) to 2,850.12, and the S&P 500 rose 0.17% or about 2 points to 1,318.85.

There were several analyst upgrades and downgrades today, including Facebook Inc. (NASDAQ: FB) started as ‘buy’ with a target price of $40 at Needham (more coverage here); Patriot Coal Corp. (NYSE: PCX) cut to ‘hold’ at Deutsche Bank; The Blackstone Group LP (NYSE: BX) raised ‘buy’ at Sterne Agee; Applied Materials Inc. (NASDAQ: AMAT) raised to ‘neutral’ at Goldman Sachs; and Dell Inc. (NASDAQ: DELL) cut to ‘neutral’ at Mizuho and maintained as ‘underperform’ with a $14 target price at Credit Suisse.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Dell is down -16.8% at $12.55 after posting a new 52-week low of $12.31 earlier today (more coverage here); American Eagle Outfitters Inc. (NYSE: AEO) is up 1.4% at $20.07; Big Lots Inc. (NYSE: BIG) is up 4% at $36.20; Hormel Foods Corp. (NYSE: HRL) is up 1.2% at $29.54; Suntech Power Holdings Co. Ltd. (NYSE: STP) is up 1.5% at $2.01 (more coverage here); and Trina Solar Ltd. (NYSE: TSL) is up 4.9% at $5.59.

Tomorrow we are scheduled to get earnings reports from Fred’s Inc. (NASDAQ: FRED), H.J. Heinz Co. (NYSE: HNZ), MakeMyTrip Ltd. (NASDAQ: MMYT), Tiffany & Co. (NYSE: TIF), The Toronto-Dominion Bank (NYSE: TD), and Costco Wholesale Corp. (NASDAQ: COST).

Other standouts from today include the following stocks:

PetSmart Inc. (NASDAQ: PETM) is up 13.3% at $62.99 after posting a new 52-week high of $63.19 earlier today. The company reported better-than-expected earnings and forecast more good things to come.

Seagate Technology PLC (NASDAQ: STX) is down -2.4% at $25.72. The disk drive maker is buying France-based LaCie SA for $186 million.

Stay tuned for Thursday. New York Fed President William Dudley is giving a speech. We have also noted the following events on the schedule (all times Eastern):

8:30 a.m. – Durable goods orders
8:30 a.m. – New claims for unemployment benefits
10:30 a.m. – EIA weekly natural gas storage report
11:00 a.m. – Kansas City Fed manufacturing index
1:00 p.m. – 7-year note auction
4:30 p.m. – Fed balance sheet and money supply

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AEO, AMAT, BIG, BX, COST, DELL, FB, FRED, HNZ, HRL, MMYT, PCX, PETM, STP, STX, TD, TIF, TSL

The Top Earnings Previews For The Week Ahead (TECD, URBN, AZO, BBY, DELL, PETM, RL, BIG, HPQ, NTAP, P, TOL, COST, TIF, PAY)

Administrator — Fri, 18 May 2012 14:09:16 +0000

24/7 Wall St. has compiled earnings previews for some of the top companies reporting in the week ahead. Estimates have been taken from Thomson Reuters for consensus earnings and targets and we have added in color on some companies if applicable.

These are some of the focus companies reporting earnings in the coming week: Tech Data Corporation (NASDAQ: TECD); Urban Outfitters Inc. (NASDAQ: URBN); Autozone Inc. (NYSE: AZO); Best Buy Co. Inc. (NYSE: BBY); Dell Inc. (NASDAQ: DELL); PetSmart Inc. (NASDAQ: PETM); Ralph Lauren Corporation (NYSE: RL); Big Lots Inc. (NYSE: BIG); Hewlett-Packard Co. (NYSE: HPQ); NetApp Inc. (NASDAQ: NTAP); Pandora Media Inc. (NYSE: P); Toll Brothers Inc. (NYSE: TOL); Costco Wholesale Corporation (NASDAQ: COST); Tiffany & Co. (NYSE: TIF); and VeriFone Systems Inc. (NYSE: PAY).

MONDAY, MAY 21

Tech Data Corporation (NASDAQ: TECD) is set to report and show how the outlook is for the companies which actually distribute all of the technology components and finished smartphones and consumer electronics devices around the world. Shares were recently under $48 and the 52-week range is $38.21 to $59.29. The consensus estimate is $1.16 EPS and $6.18 billion in revenue.

Urban Outfitters Inc. (NASDAQ: URBN) is going to show if its turnaround is closer or just still chugging along. Estimates are $0.20 EPS and $579.2 million in revenue. Shares were recently around $25.50 and the 52-week range is $21.47 to $33.90; the consensus target price is about $29.70.

TUESDAY, MAY 22

Autozone Inc. (NYSE: AZO) took it hard on the chin recently when rival Advance Auto warned of a difficult second quarter. This is one of the high-priced stocks and shares are around $366 against a 52-week range of $266.25 to $399.10. The consensus analyst target price is $419.80; estimates are $6.25 EPS and $2.13 billion in revenue; next quarter estimates are $8.47 EPS and $2.84 billion in revenue.

Best Buy Co. Inc. (NYSE: BBY) is in such disarray that we won’t even bother with the warnings and the caveats here. Estimates are $0.60 EPS.

Dell Inc. (NASDAQ: DELL) is now trading at only about 7.5-times forward earnings. Estimates are $0.46 EPS and $14.89 billion in sales. Earnings have been choppy on guidance but the PC makers and components makers are all talking up the release of Windows 8 as a new catalyst. With shares trading just under $15.00, the 52-week range is $13.29 to $18.36 and the consensus price target is almost $19.50.

PetSmart Inc. (NASDAQ: PETM) has been a steady “beat earnings and raise guidance” outfit as Americans will pay endless and countless dollars on Fido and Fifi. Estimates are $0.73 EPS and $1.6 billion in revenue. With shares around $56.00, the 52-week high is $59.36.

Ralph Lauren Corporation (NYSE: RL) has sold off nearly $40 from its highs since March. The question is how its business has been holding up in slowing markets even if the U.S. sales have been strong. Estimates are $0.83 EPS and $1.6 billion in sales. With shares around $143 the 52-week range is $105.00 to $182.48 and the consensus price target from analysts is just over $190.00.

WEDNESDAY, MAY 23

Big Lots Inc. (NYSE: BIG) should be called “Warning Lots” because it has lowered guidance and been hard on two different waves. With shares under $35 and against a high of $47.22, the premium values of the dollar stores may and discounters may be hurting here. On the flip side, the bar has been set extremely low. Estimates are $0.69 EPS and $1.3 billion in revenue.

Hewlett-Packard Co. (NYSE: HPQ) is now around the $22 handle and the news of another 25,000 or more in layoffs (versus 350K as of October 31, 2011) is not helping the growth hopes. Estimates are $0.91 EPS and $29.92 billion in sales. The stock now trades at about 6-times earnings, but the consensus price target is down to just over $29.00 as no one wants to pay up for the valuation of this DJIA component.

NetApp Inc. (NASDAQ: NTAP) has been pounded and the last 45 days has looked like a downward staircase on its chart. At about $34.00, the 52-week range is $33.00 to $56.49 and the consensus price target objective is just over $47.00.

Pandora Media Inc. (NYSE: P) is no longer market-influencing, but it is a cult stock and the earnings could create a large gain or a large drop. With shares under $10.50, the post IPO range is $7.83 to $26.00. Estimates are -$0.17 EPS and $74.3 million in revenue. Can the company make it to profitability by the end of next year?

Toll Brothers Inc. (NYSE: TOL) is expected to be profitable. A profitable homebuilder! At $25.50, the 52-week range is $13.16 to $27.80. A lot of good news already has to be priced in, so we would want to expect upside to remain positive here. Estimates are $0.04 EPS and $381.9 million in revenue.

THURSDAY, MAY 24

Costco Wholesale Corporation (NASDAQ: COST) almost always beats its earnings estimates. At $83.75 the 52-week range is $70.22 to $92.10; analysts have a target price of $86.80 or so. Estimates are $0.87 EPS and $22.1 billion in revenue.

Tiffany & Co. (NYSE: TIF) has come off of its highs significantly and this is the king of jewelry stores for investors. There will have been two smaller reports ahead of Tiffany in the week with Fred’s and Zale. Estimates for Tiffany are $0.69 EPS and $816.8 million. With shares under $61.00, the 52-week range is $56.21 to $84.49 and the consensus price target is $75.63.

VeriFone Systems Inc. (NYSE: PAY) has pulled back by about 20% from its highs, but the woes of the company seem to be behind it. At $44.80, the 52-week range is $30.25 to $55.89 and the consensus analyst price target is $54.10. Estimates are $0.61 EPS and $471.5 million in revenue.

As a reminder, dates and estimates can change ahead of earnings and some may have already changed.

JON C. OGG

Filed under: Calendar, Earnings, The Week Tagged: AZO, BBY, BIG, COST, DELL, HPQ, NTAP, P, PAY, PETM, RL, TECD, TIF, TOL, URBN

Is Costco Competing Against Tiffany, Blue Nile, and High-End Jewelers Now? (COST, TIF, NILE)

Administrator — Tue, 24 Apr 2012 16:45:34 +0000

Tiffany & Co. (NYSE: TIF) is widely thought of as the king of high-end jewelry. While many local high-end jewelry stores compete with Tiffany in local markets, it is hard to imagine that Costco Wholesale Corporation (NASDAQ: COST) is a real destination for ultra high-end jewelry. The reality is that Costco has had many higher-end offering through the years but it is hard to imagine that you can spend $100,000 or $300,000 or even over $400,000 for diamond ring made of platinum at the box-store giant.

Here are some of the offerings from Costco:

4.25 ct Round IF Clarity, D Color…. Only One Available Platinum band; IGI Value: $652,755 Costco Price: $459,999.99

6.55 ct Round Brilliant, VS1 Clarity, G Color… Only One Available Platinum band, GI Value: $536,255 Costco Price: $329,999.99

3.06 ct Round, VVS2 Clarity, D Color… Only One Available Diamond Solitaire Ring, Platinum band, IGI Value: $264,295 Costco Price: $179,999.99

3.01ct Round Brilliant, VVS1 Clarity, F Color… Only One Available Diamond Solitaire Ring, Platinum band, IGI Value: $214,295 $139,999.99

Costco has 6 featured rings priced from over $100,000 to the $459,999.99 peak. While these are all featured as one of a kind items, the intention is likely the obvious move that it wants a proof of concept that it can sell very high-end jewelry (and other items). The move to offer jewelry is certainly not a new one from Costco. Wal-Mart Stores Inc. (NYSE: WMT) has also been in the jewelry business for some time even if its high-end rings cap out in the $1,000 to $3,000 range.

As far as how to get up this high in a diamond, Blue Nile Inc. (NASDAQ: NILE) is also in the game of ultra high-end diamonds. Blue Nile lists the following diamond (without a band) but this is not really apples to apples: Round; 12.84 ct.; Very Good; J; VS2; Blue Nile Price: $488,624

Blue Nile has many large diamonds, and two seen on the list were in excess of $1 million for the diamond alone. Obviously they are one of a kind as well with on being 12.35 carat and the other being 7.57 carat.

Many retailers want to cater to the high-end consumer. The efforts and ways that this consumer group gets targeted never seems to have an end.

JON C. OGG

Filed under: Consumer Goods, Luxury, Retail Tagged: COST, TIF

24/7 Wall St. Closing Bell (AAPL, FSLR, VLO, TIF, C, CMA, GS, JNJ, MMR, GWW, YHOO, SYK, STX, URI, SRSL, ENOC, LEE)

Paul Ausick — Tue, 17 Apr 2012 20:07:31 +0000

Markets opened higher this morning and by late-morning equities were trading down about 1.5% across the board, where they have mostly remained for the rest of the day. An upbeat auction on short-term Spanish bonds and several positive earnings reports this morning led the market higher. China reported a sharp decline in foreign direct investment, but the impact on European and US markets was negligible. The US dollar index fell today, now down -0.11% at 79.467. The GSCI commodity index is down about -0.03% at 675.59, with most commodities gaining on the falling dollar. WTI crude oil closed up 1.2% at $104.20/barrel, and Brent crude trades down -0.06% at $118.61/barrel. Gold settled up 0.01% today, at $1,651.10/ounce.

The unofficial closing bells put the DJIA up more than 194 points to 13,115.54 (1.50%), the NASDAQ rose more than 54 points (1.82%) to 3,042.82, and the S&P 500 rose 1.55% or more than 21 points to 1,390.78.

There were several analyst upgrades and downgrades today, including Apple Inc. (NASDAQ: AAPL) started as a ‘strong buy’ with a target price of $800 at Raymond James; First Solar Inc. (NASDAQ: FSLR) cut to ‘hold’ at Goldman Sachs; Valero Energy Corp. (NYSE: VLO) reiterated as ‘outperform’ with a target price of $37 at Credit Suisse; Tiffany & Co. (NYSE: TIF) started as ‘neutral’ at Macquarie; and Citigroup Inc. (NYSE: C) reiterated as ‘outperform’ with a target price of $48 at Credit Suisse.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Comerica Inc. (NYSE: CMA) is up 3.6% at $31.98; Goldman Sachs Group Inc. (NYSE: GS) is down about -1% at $116.59; Johnson & Johnson (NYSE: JNJ) is up 0.30% at $64.17; McMoRan Exploration Inc. (NYSE: MMR) is up 4% at $9.07; and W.W. Grainger Inc. (NYSE: GWW) is up 0.01% at $215.80;

After markets close today, we’ll hear from Yahoo! Inc. (NASDAQ: YHOO), Stryker Corp. (NYSE: SYK), Seagate Technology PLC (NASDAQ: STX), and United Rentals Inc. (NYSE: URI).

Other standouts from today include the following stocks:

SRS Labs Inc. (NASDAQ: SRSL) is up almost 37% at 9.38. The audio and voice technology company is being acquired by DTS for about $134 million.

EnerNOC Inc. (NASDAQ: ENOC) is up nearly 17% at $7.61. The smart metering company has a contract to provide natural gas metering services for 4,000 non-residential buildings in Brooklyn and Queens, New York.

Lee Enterprises Inc. (NYSE: LEE) is down -12% at $1.15. The newspaper publisher posted a wider loss in its second fiscal quarter.

Stay tuned for Wednesday. We have noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Bankers’ Association purchase applications
10.30 a.m. – EIA weekly petroleum status report

Paul Ausick

Filed under: HI/LOW, Market Close Tagged: AAPL, C, CMA, ENOC, FSLR, GS, GWW, JNJ, LEE, MMR, SRSL, STX, SYK, TIF, URI, VLO, YHOO

Top Analyst Upgrades & Downgrades (ACHN, AAPL, BSX, CLS, C, CTRN, FSLR, HAIN, IDIX, INFY, NCT, SAP, TNK, TIF, VLO, VRTX)

Administrator — Tue, 17 Apr 2012 12:27:46 +0000

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

Achillion Pharmaceuticals Inc. (NASDAQ: ACHN) Started as Outperform with $11 target at Credit Suisse.

Apple Inc. (NASDAQ: AAPL) Started as Strong Buy with $800 target at Raymond James (late Monday call).

Boston Scientific Corp. (NYSE: BSX) Reiterated Outperform with $7 target at Credit Suisse.

Celestica Inc. (NYSE: CLS) Cut to Hold at Deutsche Bank.

Citigroup Inc. (NYSE: C) Reiterated Outperform with $48 target at Credit Suisse.

Citi Trends, Inc. (NASDAQ: CTRN) named Bear of the Day at Zacks.

First Solar, Inc. (NASDAQ: FSLR) Cut to Hold at Goldman Sachs.

Hain Celestial Group (NASDAQ: HAIN) named Bull of the Day at Zacks.

Idenix Pharmaceuticals Inc. (NASDAQ: IDIX) Started as Neutral at Credit Suisse.

Infosys Ltd. (NASDAQ: INFY) Cut to Neutral at Goldman Sachs.

Newcastle Investment Corporation (NYSE: NCT) Started as Outperform at Keefe Bruyette & Woods.

SAP AG (NYSE: SAP) Raised to Buy at SocGen; Cut to Neutral at HSBC.

Teekay Tankers Ltd. (NYSE: TNK) Raised to Neutral with new $5.20 target at BofA/ML.

Tiffany & Co. (NYSE: TIF) Started as Neutral at Macquarie.

Valero Energy Corporation (NYSE: VLO) Reiterated Outperform with $37 target at Credit Suisse.

Vertex Pharmaceuticals Inc. (NASDAQ: VRTX) Started as Outperform with $43 target at Credit Suisse.

If you enjoyed the top analyst upgrades and downgrades, you can join our free email newsletter that includes analyst summaries each morning sent right to your inbox. We also cover top issues such as IPOs, special financial exclusives, mergers and more. Sign up in the box below.

JON C. OGG

Filed under: Analyst Calls Tagged: AAPL, ACHN, BSX, C, CLS, CTRN, FSLR, HAIN, IDIX, INFY, NCT, SAP, TIF, TNK, VLO, VRTX

24/7 Wall St. Closing Bell (ARMH, HOG, UPS, KMI, AAPL, FCFC, JASO, JEF, PATH, TIF, ORCL, KKD, RCON, NEWL, TRGT)

Paul Ausick — Tue, 20 Mar 2012 20:06:57 +0000

Markets opened lower this morning and nothing came along all day to move any of the three major indexes above the neutral line. The morning’s report on housing starts was no better than flat with the January number, although the number of new permits jumped suggesting that March might see some more building action (our coverage here). The US dollar index was stronger today, now up 0.16% at 79.596. With few exceptions, commodities fell on the dollar strength. Oil took a considerably hard knock today, primarily because Saudi Arabia promised to take care of any supply shortages (our story here). WTI crude oil closed down -2.3% at $105.61/barrel, and Brent crude trades down -1.09% at $124.34/barrel. Gold settled down -1.2% today, at $1,647.00/ounce.

The unofficial closing bells put the DJIA down nearly 69 points to 13,170.19 (-0.52%), the NASDAQ fell more than 4 points (-0.14%) to 3,074.15, and the S&P 500 fell -0.30% or more than 4 points to 1,405.52.

There were several analyst upgrades and downgrades today, including ARM Holdings plc (NASDAQ: ARMH) raised to ‘overweight’ at Barclays; Harley-Davidson Inc. (NYSE: HOG) raised to ‘outperform’ at BMO; United Parcel Service (NYSE: UPS) cut to ‘hold’ at Stifel Nicolaus; Kinder Morgan Inc. (NYSE: KMI) cut to ‘underperform’ at BofA/ML; and Apple Inc. (NASDAQ: AAPL) reiterated ‘buy’ and target prices raised to $740 and $700 at Sterne Agee and Credit Suisse, respectively (more coverage here).

Earnings reports since markets closed last Friday have led to some price changes as of the last half hour of trading today: First City Financial Corp. (NASDAQ: FCFC) is down -10.4% at $8.92; JA Solar Holdings Co. Ltd. (NASDAQ: JASO) is up 4.4% at $1.90; Jefferies Group Inc. (NYSE: JEF) is up 1.9% at $19.43; NuPathe Inc. (NASDAQ: PATH) is down -13.3% at $3.90; and Tiffany & Co. (NYSE: TIF) is up 6.8% at $73.37 (our coverage here). After the markets close today, Oracle Corp. (NASDAQ: ORCL) and Krispy Kreme Doughnuts Inc. (NYSE: KKD) are scheduled to report earnings.

Other standouts from today include the following stocks:

Recon Technology Inc. (NASDAQ: RCON) is up nearly 82% at $4.09 after setting a new 52-week high of $4.58 earlier today. The Chinese oil field services company has cleared up its problems with Nasdaq and signed some new contracts for the first half of the year. More coverage here.

NewLead Holdings Ltd. (NASDAQ: NEWL) is up nearly 34% at $1.67. The shipping company cancelled a reverse stock split. More coverage here.

Targacept Inc. (NASDAQ: TRGT) is down about -30% at $5.17. The drug maker will not seek FDA approval for a new anti-depressant. More coverage here.

The US Commerce Department found the Chinese guilty of dumping solar panels in the US and has hit back with tariffs of 2.9% to 4.73% on solar panel imports. More coverage here.

Stay tuned for Wednesday. Federal Reserve Chairman Ben Bernanke is giving a speech. We have also noted the following events on the schedule (all times Eastern):

7:00 a.m. – Mortgage Banker’s Association purchase applications
10:00 a.m. – Existing home sales
10:30 a.m. – EIA weekly petroleum status report

Paul Ausick

Filed under: HI/LOW, Market Close, The Day Tagged: AAPL, ARMH, FCFC, HOG, JASO, JEF, KKD, KMI, NEWL, ORCL, PATH, RCON, TIF, TRGT, UPS

Tiffany Jumps on Forecast (TIF)

Paul Ausick — Tue, 20 Mar 2012 18:37:36 +0000

Jeweler Tiffany & Co. (NYSE: TIF) reported fourth quarter and full year results this morning. For the quarter, EPS missed the consensus estimate of $1.42, coming in at $1.39. Revenues were inline for the quarter at $1.19 billion.

Investors had been concerned that weak sales in November and December would carry over to January and into the new fiscal year starting in February. The company put some sparkle in investors’ eyes though when it forecast higher than expected EPS for the next fiscal year. Tiffany forecast earnings of $3.95-$4.05, higher than the consensus estimate of $3.93.

Shares are up nearly 7% at $73.43 in a 52-week range of $56.21-$84.49.

Filed under: Earnings Tagged: TIF

Do Long-Term Berkshire References Matter? Stocks Versus Bonds (BRK.B, BRK.B, BAC, GS, GE, HOG, TIF)

Administrator — Wed, 29 Feb 2012 18:51:49 +0000

Berkshire Hathaway Inc. (NYSE: BRK.B) (NYSE: BRK.B) is very widely followed due to the great performance through time and due to the following of the great Warren Buffett. It has been an amazing story that won big on the growth of America. It is interesting that long-term values are used retroactively over and over, when all that really matters now is “what lies ahead”…

An interesting read from one of our friends talks up the consolidated annual growth rate of Berkshire Hathaway going all the way back to 1989. It shows what the great Warren Buffett hopes you will believe for the future: 14.9% CAGR for Berkshire Hathaway versus 6.8% for the S&P 500 Index. Our question is more about how this will compare in the years ahead.

Buffett himself has said he already expects that Berkshire Hathaway shares will lag the S&P 500 Index in years when the S&P rises sharply. This puts Berkshire Hathaway in a slightly defensive bet against the S&P 500. The company maintains a large cash balance and it is actively invested in bonds.

Another argument we have is that perhaps Berkshire Hathaway should be benchmarked more against a blend of the Barclays Aggregate index and the S&P 500 Index so that it tracks a blended performance of stocks and bonds. Should it be an equal-weighting between the two indexes? Probably not. Maybe it should only be 30% weighted in the bond side. We’d love to see a blended analysis of this through time.

Consider how many corporate bets Warren Buffett has made on the preferred share investments rather than just the common stock. Some bets have included warrants so that there is large upside, but arguably these were debt investments which have a priority over the common shareholders if there is ever an implosion. Some of the bets in this manner were in Bank of America Corporation (NYSE: BAC) most recently, but there have also been big bets of this sort in Goldman Sachs Group Inc. (NYSE: GS) and General Electric Co. (NYSE: GE).

Buffett even took a $600 million stake in senior unsecured notes in Harley-Davidson Inc. (NYSE: HOG) in 2009 with a 2014 maturity at 15%. He also took a 10% note offering in Tiffany & Co. (NYSE: TIF) in early 2009 of $250 million with those notes maturing in 2017 and 2019.

Warren Buffett of course is no different from other great managers in the sense that he talks his book. He has to use all of those corny old analogies to try to keep investors focused on the long-term horizon rather than just a few months out. Buffett has also recently said he prefers more stable foreign sovereign debt than what the low rates of the United States pays in Treasuries.

Much of this long-term pondering about Buffett’s performance only matters to those who bought back then and held. All that matters for new investors is what the prospects are for the next ten years. Our take is that Berkshire Hathaway comparisons to “the market” need to at least have some form of a blended bond portfolio with a smaller weighting than the S&P 500 Index.

JON C. OGG

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