Posts for Ticker ‘TYC’

Top 10 Earnings on Deck This Week (ERTS, ENER, PCLN, SQNM, TYC, AMAT, M, JWN, WMT, DIS)

bull-and-bear-image2Earnings season has wound down now with over 85% of the S&P 500 Index having reported.  Still, there are some key companies posting their quarterly results and some companies were screened out of this list which are still actively traded or widely held stocks.  Electronic Arts Inc. (NASDAQ: ERTS), Energy Conversion Devices, Inc. (NASDAQ: ENER), Priceline.com Inc. (NASDAQ: PCLN) and Sequenom Inc. (NASDAQ: SQNM) are on deck Monday. Also this week are earnings from Tyco International Ltd. (NYSE: TYC), Applied Materials Inc. (NASDAQ: AMAT), Macy’s, Inc. (NYSE: M), are Nordstrom Inc. (NYSE: JWN). Wal-Mart Stores, Inc. (NYSE: WMT) and Walt Disney Co. (NYSE: DIS) are our two DJIA components reporting this week.

We have included Thomson Reuters consensus estimates and included performance and other important color where applicable.  We have shown the share performance since the March 9 close that traders mark as the official end date of the bloody bear market.  One issue to consider is that we used the performance since June 30 to keep consistency for our prior previews even though some of the quarter-ends this coming week are technically August 31.
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Posted on: November 8, 2009 – 10:26 am in Alternative Energy, Calendar, Cult Stock, Earnings, Green Biz, Retail, Semiconductor, Short Interest, , , , , , , , , ,

The Lame Blame on Short-Termism

Bull and Bear ImageThere is a very silly notion being brought to you by the Aspen Institute Business & Society Program’s Corporate Values Strategy Group and what is admittedly a rather impressive list of names joining it. It is a call to end “Short-Termism” in the financial markets.  Imagine a long-term financial utopia where investors did not have to trouble themselves with the day in and day out wranglings of the stock market or the economy.

Imagine if quarterly earnings, monthly same-store-sales, quarterly or annual guidance, key turns in the demand cycle, interruptions or obsolescence of a business model and other issues were just able to be smoothed over.  Now imagine investing in this sort of a climate.  This idea sounds great on paper and probably looks great on economic models and charts that are the basis for the notion because it goes along with the current theme of thinking for the long-haul and doing what is best for everyone else.  The problem is that this is the most silly and perhaps dangerous notion for the public to embrace.  This is a path for investors large and small to get drummed, slapped, duped, discouraged and a few other things we decided not to print.
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Posted on: September 9, 2009 – 12:10 pm in Accounting, Activist Investor, Brokerage Firms, Buffett, Economy, Editor's Picks, Exchange News, Labor & Unions, Regulation, Research, Shareholder Issues, Utilities, Value Investing, , , , , , ,

Early Bird Analyst Upgrades (ASCA, ABX, BX, JNS, JPM, KGC, REP, SAP, TYC, WEN)

money-stack-imageThese are some of the top pre-market analyst upgrades from Wall Street this Monday morning with well over two hours until the open:

Ameristar Casinos (ASCA) Raised to Overweight at JPMorgan.
Barrick Gold (ABX) Raised to Overweight at JPMorgan.
Blackstone (BX) Raised to Outperform at KBW.
Janus Capital (JNS) Raised to Overweight at JPMorgan.
JPMorgan Chase (JPM) Raised to Outperform at KBW.
Kinross Gold (KGC) Raised to Overweight at JPMorgan.
Repsol SA (REP) Raised to Buy at UBS.
SAP (SAP) Raised to Buy at Deutsche Bank.
Tyco (TYC) Raised to Buy at Citigroup.
Wendy’s/Arby’s (WEN) Raised to Neutral at JPMorgan.

JON C. OGG

Posted on: March 2, 2009 – 7:15 am in Analyst Calls, , , , , , , , , ,

Top Pre-Market Analyst Downgrades (AEP, DOV, GS, HWCC, ITT, LXK, TYC, UTHR, WYNN)

These are some of the key analyst downgrades or negative calls we are seeing this Tuesday morning:

  • American Electric Power (AEP) Cut to Neutral at JPMorgan.
  • Dover (DOV) Cut to Neutral at JPMorgan.
  • Goldman Sachs (GS) Cut to Hold at Deutsche Bank.
  • Houston Wire & Cable (HWCC) Cut to Neutral at Piper Jaffray.
  • ITT Corp. (ITT) Cut to Underweight at JPMorgan.
  • Lexmark (LXK) Started as Underperform at Credit Suisse.
  • Tyco International (TYC) Cut to Neutral at JPMorgan.
  • United Therapeutics Corp. (UTHR) Started as Sell at Piper Jaffray.
  • Wynn Resorts (WYNN) Cut to Neutral at JPMorgan.

Jon C. Ogg
August 12, 2008

Posted on: August 12, 2008 – 6:29 am in Analyst Calls, , , , , , , , ,

Tyco Doubles Down on Buybacks (TYC)

Tyco International Ltd. (NYSE: TYC) has decided to re-join the stock buyback regime seen elsewhere now that it has been a year since its break-up.  The company has announced that its Board of Directors has authorized a new share buyback program to repurchase up to $1 Billion of the company’s common stock.

The company expects to repurchase shares from time to time based on market conditions. This new buyback program is in addition to the existing $1 Billion buyback program that was authorized in September 2007.  That existing plan is nearing completion.

Tyco has also noted that up to this point in fiscal 2008, it has repurchased approximately 4% of its outstanding shares of common stock.  As far as the size of this buyout and how it compares to the company overall, it is a decent sized buyback.  Tyco had 2007 revenues of more than $18 Billion and its market cap is about $18.7 Billion.

Shares are actually up 5% this morning at $40.86 and its 52-week trading range is $31.01 to $51.89.

Jon C. Ogg
July 10, 2008

Posted on: July 10, 2008 – 8:16 am in Conglomerates, Stock Buybacks,

Stocks & Trends For Bear Market & Recession Investors

2008 is turning out to be a wacky year.  If you are new to trading and investing this is far from the norm.  Statistics vary depending on what day of the week it is but this is the worst January start to a year for most of us.  The DJIA is down some 7.9% in 2007 after a December-end close of 13,264.82; and it is down some 14.5% from the 14,280.00 highs of October 2007. The NASDAQ has fared even worse with a 12.2% drop since December-end close of2,652.28; and it is down 18.7% from the highs of 2,861.51 on October 31, 2007.

The good news is that there are many stocks and many sectors that hold up and it is becoming ever easier by the day for Joe Q. Public to learn to profit from the market slides too.  We just covered a whole spate of ETF’s (OUR FULL ETF INDEX HERE) and you can see the bear market ETF’s to own, and these will also be the ones that many trade during a recession.  We would caution that with many already writing about a bear market or a recession that the worst may have already been seen.  Investors who buy when everyone else feels miserable usually win in time.  247WallSt.com has come up with many lists for traders and investors for 2008.

Investors have been fond of Defensive Stocks in companies such as food, beverages, tobacco, consumer products, and the like.  We have our own index where we cover Value Stocks and trends affecting individual stocks that are geared toward value investors.  We noted "The Four Safest Stocks in the World" this last week, and we even came up with a list of value stocks from defensive stocks for the first part of 2008.

We also gave our own targets and opinions on the components of the Dogs of the Dow for 2008 to show which ones are challenged to do better and which ones may be the sleepers.  Does it make sense that Home Deport (NYSE: HD) is UP FOR 2008?  We outlined it as "Bad times at companies feel like they will last forever just like in the economy, but history dictates that they always recover.  After Q1 or Q2 this could end up being one of the surprise sleepers of 2008."

We also created a list of iconic US companies that may not exist at the end of 2008. Some may not even make it halfway through the year. Not all of these will go out of business, as some may be auctioned off in pieces and others may be bought.

Turnaround stocks (FULL INDEX HERE) are perhaps some of the best opportunities.  Whether you are in good times or bad times there are many companies that just don’t make the grade and have difficulty in generating any growth or any consistent earnings.  Catching the right one will be exponentially rewarding, but because these are troubled you have to be aware that some will completely bite the dust.  We broke these up groups as well and came up with a basic industry list that has yet to turn the ship around.

First and foremost, we came up with a list of stocks that could double in 2008.  This is not a safe list for the faint of heart, because the set-up for a double is very difficult for established companies and there are usually extreme circumstances that have to be in place.  Companies like E*Trade (NASDAQ: ETFC), Palm (NASDAQ: PALM), SIRIUS Satellite radio (NASDAQ: SIRI), Level 3 Communications (NASDAQ: LVLT) and more are on this one.  FULL LIST HERE.  When we did this big list and evaluated out screening of more than 100 companies, there were actually many more stocks that also fit the bill.  Keep in mind that something bad happened along the way for these shares to have been bettered enough where the stock could double. On this other list were companies like Capstone Turbine (NASDAQ: CPST), Qwest Communications (NYSE: Q), Travelzoo (NASDAQ:TZOO) and more. FULL SECOND LIST HERE.

247WallSt.com has also noted some of Jim Cramer’s 2007 calls that still show some pertinence in 2008, and many are still active calls of his.  Cramer also recently outlined many overlooked or oversold tech stocks that he thinks have an uncommon value here.

Most of these come under review regularly in our weekly subscriber letter in "10 Stocks Under $10" which is exactly what it describes: ten low-priced stocks under $10 where we make bullish or bearish analysis as to what is good or what is bad about these.  We call some candidates for exponential growth and some where we think the companies are likely doomed.  247WallSt.com even produced a list of stocks whose volatility and values could cause the shares to FALL 50%.  Some of these already have or are close to it.

Lastly, we have a list of potential management changes.  We have a list of CEO’s that we have designated as CEO’s WHO NEED TO GO.  This is not only over share prices, because many companies do well while their stock doesn’t.  These CEO’s have done heinous jobs usually with a key event or series of events under their watch that has rendered them (and their company) useless.  We even gave a handicap of what sort of rally the stock might see if these managers left.

Jon C. Ogg
January 27, 2008

Posted on: January 27, 2008 – 8:51 am in Defensive Stocks, Economy, Index, Turnarounds, Value Investing, , , , , , , , , , , , ,

Why Are So Many Turnarounds Failing? (EK, PFE, RAD, TYC)

We compiled a list of many companies that just haven’t been able to turn themselves around.  On some we offered a road out and on others we feel sorry for the management because getting out of the holes that the companies have dug just might not be possible.

Most of these that were covered ended up being tech stocks of some sort as many of those have remained in the gutter. But there are many major economy stocks that are underperforming against their potential.  These non-technology companies in here still have a shot at executing a turnaround, but after years of failure you can imagine an activist or worse might start rearing its head.  These are not at all the only turnarounds that could manage to turn their ships, but these are some that we covered.

Eastman Kodak (NYSE:EK) is in a pickle and frankly we are shocked that shareholders haven’t revolted against Antonio Perez as CEO.  He was one our CEO’s TO GO for 2007, although we didn’t add him on the 2008 list.  This company has to rapidly implement its layoffs and restructuring rather than dribbling it out over a 10 year period.  They need to go back after more of the digital space.  They are trying, but nowhere near enough.

Pfizer (NYSE:PFE) has seen its share of skepticism.  It has been dead money and the new CEO is running out of "getting used to the job" time.  What is interesting is that a boost could come straight from a couple of acquisitions of companies with blockbuster drugs about to hit market.  Their drug pipeline might also not be as bad as we think. If the company gets off its duff, it could be one of the better drug companies with upside.  It was also reviewed under our 2008 Dogs of the Dow stocks.

Rite Aid (NYSE:RAD) has been another utter and complete failure of a turnaround.  This new CEO is actually very well respected and very well thought of.  She also didn’t make up excuses in the last two reports as to fake reasons for a failure.  She needs to make 2008 the year of execution of a turnaround.  It is possible.  This was also Jim Cramer’s #2 Speculative Stock for 2007.

Tyco International Ltd. (NYSE: TYC) is a turnaround that even though it started its turnaround has only managed a 360.  Its Tyco Electronics (NYSE: TEL) and Covidien (NYSE: COV) spin-offs have yet to rapidly reward shareholders.  The good news is that by early 2008 we will have at least two quarters of operations under the belt at each unit.  After that we expect that analysts will be able to adequately make their decisions on how to assign earnings targets.  The Tyco-stub is either one hell of a value stock, or it’s just a value trap.  We’ll know soon. 

These stocks may all be covered in newsletters because many now fit in the 10 STOCKS UNDER $10 newsletter category and many fall under the Special Situation Investing Newsletter category. 

On a separate note, we gave two different groups of stocks whose shares could actually double in 2008.  Our first list was of the more active names that are low-priced, and our second list was the screened group of stocks that was of known stocks that are just not quite as actively traded.  Lastly, we also gave a list of stocks that could drop another 50% in 2008 if these operators stumble or others that just don’t get their you know what together.

2007 had its share of great IPO’s and stinky IPO’s.  We showed a solid list of IPO’s that performed with stellar returns that came public in 2007.  And of course there is that smelly and stinky list of IPO’s that lost more than half of their value since coming public in 2007 as well.  Believe it or not, some of these could be winners if they manage to do the right thing.

We issued a GUIDELINES for turnarounds.  For starters we avoided financial stocks, lenders, housing related, autos, and most retail names because the problems there are so bad that they will get fixed when the industry pressure allows them to get fixed.  Those might continue there march south until finally too much is too much, and while we feel that may be close we aren’t hanging our hat on any date yet.  It just hasn’t worked.

You can join our free email distribution list for previews on other IPO’s, spin-offs, reorganizations, restructurings, merger-arb, speculation, and other aspects of M&A.  Here you may get some forethoughts on developing situations before the full data is published.

Jon C. Ogg
December 29, 2007

Posted on: December 29, 2007 – 8:01 am in Turnarounds, , , ,

Turnarounds That Haven’t Turned Around: Tyco International (TYC, TEL, COV)

Tyco International Ltd. (NYSE: TYC) is a hard turnaround to call as one that hasn’t turned around because it has already begun its long-term initiatives to enhance shareholder values.  The problem is that it has been unsuccessful so far.  The company completed the spin-off of Tyco Electronics (NYSE: TEL) and Covidien Ltd. (NYSE: COV) on July 1, 2007.  Because of these spin-offs, Tyco was a much harder stock to cover and to use valuations and historical data on.  In fact, analysts from large brokerages and bulge bracket firms have had a hard time breaking down the de-conglomerized conglomerate.  We also want to caution that many figures used actually vary from source to source and this made analysis not as straightforward here in this case.

First, let’s look at the spin-off companies.  Tyco Electronics (NYSE: TEL) traded at $39.81 on a dividend adjusted basis at the end of July 2 and have fallen down to the mid to low-$30’s before a recent recovery. But even north of $37.00 shares are still down.  Tyco Electronics has a equally mixed coverage spread between Buy/Hold and an average price target of roughly $41.00 from analysts.  Covidien (NYSE: COV), the medical products entity, shares traded at $43.24 on a dividend adjusted basis at the end of July 2 and have traded in mostly in a high-$30’s to mid-$40’s basis since.  With a $44+ handle this one still has a mixed verdict depending upon whom you ask.  Covidien has a mixed opinion from a thin group of analysts and an average price target of roughly $47.50.  It seems that offspring aren’t being thought of as great growth vehicles.

But back to Tyco International Ltd. (NYSE: TYC).  Tyco International shares took a serious hit in late 1999, but they recovered sharply and hit new highs in 2001.  By early 2002 the accounting scandals and the Koz issues came full circle and shares were crushed.  On an adjusted basis the stock lost more than two-thirds of its value.  2003 to the end of 2004 were great years to own shares, but this hasn’t really been the case since then.

Back before these spin-offs were completed, we noted how there appeared to be a phantom premium in Tyco shares just because of the hype around the break-up and because of the craze surrounding private equity and shareholder initiatives.  What appears to have happened is that now the street has given it a more proper valuation or at least a more realistic one, and as we noted not all bad stories have to have sad endings.

On an adjusted basis Tyco International (NYSE:TYC) shares were over $50 at the July 1 date, but they have never been back.  Shares trade around $40 now and have been as low as $38-ish over recent weeks.  If you trust the "average price targets" from analysts, that appears to be around $50.00 from a much smaller group than in prior years.

Just last week a court approved some $3.2 Billion in investor class action law suit settlements over the accounting fraud took the company down.

We do caution against using any solid earnings forecasts because many analysts have not fully adjusted their opinions to reflect the "new" Tyco in a post spin-off world.  First Call has Fiscal September-2008 EPS at $2.61 (a 15.5 forward P/E ratio) and fiscal September-2009 EPS at $3.24 (a 12.5 forward P/E ratio), although we still question some of these since the spin-offs.  If the company can achieve those estimates, then there are few who could argue against this being one of the better value plays out there.

Most of our "turnaround stocks that haven’t turned around" are troubled companies in troubled predicaments that may have a very hard time making a turnaround come to fruition.  But Tyco may be one of the exceptions.  That phantom premium may be in the rear view mirror.  Its value is also now easier to see since the spin-offs have been completed and are basically two quarters on their own.  Who knows, maybe 2008 to 2009 will be Tyco’s time to shine.

Jon C. Ogg
December 28, 2007

If you want to see our previews for IPO’s, spin-offs, merger-arb, reorganization, and more, you can sign up for our free email distribution list.  If you want detailed information with actionable trading information along with ideas for hedging risk, you can sign-up for our Special Situation Investing Newsletter with much more detail, projections, and an expected time-line.

Posted on: December 28, 2007 – 6:29 am in Conglomerates, Turnarounds, Value Investing, , ,

Emerson Added to Goldman Sachs Conviction Buy List (EMR, DHR, TYC)

Goldman Sachs has raised its "Neutral" rating on Emerson Electric (NYSE:EMR) and added it to the Conviction Buy List.  Goldman based the upgrade on positive earnings outlook and an attractive risk versus rewards analysis.  Its 2008 and 2008 estimates were raised and it now sees 12% upside to the $52.00 prior target with a new target set at $58.00.  Goldman Sachs also noted that Emerson is one of its six well positioned multi-industry primes at this stage of the cycle and lists catalysts as upward earnings revisions and even lists M&A in the fold.  As a "flight from the dollar" this works as well, because Goldman Sachs lists 52% of sales being non-U.S and noted exposure to oil and gas.

On the reverse, Goldman Sachs downgraded Danaher Corp. (NYSE:DHR) to Neutral and downgraded Tyco International (NYSE:TYC) to a "SELL" rating.

Emerson Electric shares are trading up over 2% pre-market at $52.75.  Danaher shares are down 1% at $82.00 pre-market and Tyco shares are trading down 1.5% at $44.00 in pre-market activity.

Jon C. Ogg
September 27, 2007

Posted on: September 27, 2007 – 7:57 am in Analyst Calls, , , , , ,

Pre-Market Analyst Calls (September 4, 2007)

ABY raised to Neutral at UBS.
AMD raised to neutral at Credit Suisse.
AG raised to neutral at Credit Suisse.
AEO raised to Outperform at Cowen.
BLOG started as Outperform at Wachovia.
DVA raised to Buy at Deutsche Bank.
EXEL cut to Mkt Perform at Wachovia.
FCSX raised to BUy at B of A.
HOKU raised to Mkt Perform at Piper Jaffray.
HSII cut to Sell at UBS.
INFA started as Outperform at CIBC.
KFN cut to Sell at UBS.
KOP cut to Hold at Jefferies.
KPN cut to Hold at Citigroup.
KSU raised to Buy at UBS.
MNST cut to Neutral at UBS.
MXIM started as Outperform at RBC Capital.
OII started as Overweight at JPMorgan.
OTE cut to Peer Perform at Bear Stearns.
PCG raised to Overweight at Lehman.
RDS/A raised to Buy at UBS.
RHI cut to Neutral at UBS.
RIMM cut to Peeer Perform at Bear Stearns.
SMOD cut to Hold at Citigroup.
SPR started as Overweight at Lehman.
TEF cut to Hold at Citigroup.
TMA raised to Outperform at FBR.
TYC raised to Buy at Deutsche Bank.
TYPE started as Buy at B of A.
TYPE started as Buy at Jefferies.
WEC raised to Overweight at Lehman.

Jon C. Ogg
September 4, 2007

Posted on: September 4, 2007 – 7:12 am in Analyst Calls, , , , , , , , , , , , , , , , , , , ,

The Tyco Aftermath (TYC, TEL, COV)

Tyco International Ltd. (NYSE:TYC) is one of those strange spin-off and restructuring stocks that has not done well since the company broke itself up.  The Tyco Electronics (NYSE:TEL) and Covidien (NYSE:COV) stocks have also fallen more than the overall market since the spin-off.  But not all bad stories have sad endings.  We will be sending out a tie to one of the new companies next week to subscribers of our Special Situation Investing Newsletter.

Before the Tyco (NYSE:TYC) break-up we had many inquiries for higher and higher price targets on Tyco, but the fundamental problem was that no matter how we crunched those numbers the math just didn’t work for Tyco’s stock price at the time.  We even called it a ‘phantom premium running Tyco shares’ ahead of the event because investors were too much in love with the private equity, mergers, and break-ups at the time.  That stock had a phenomenal run from last summer to this summer as the deal was quite well telegraphed, but nonetheless there existed a phantom premium. 

Posted on: August 28, 2007 – 8:20 am in Conglomerates, , , , ,

Early Research Calls 7/9/2007

Bear Stearns Upgrades PCAR to outperform.

Think Equity downgrades YHOO to accumulate.

LXK cuts guidance for Q2.

TEVA upgraded to outperform at Bear Strearns.

ESV downgraded to underperform at Credit Suisse.

GOOG target upped to $700 at Think Equity.

TYC downgraded to sell at Citi.

Douglas A. McIntyre

Posted on: July 9, 2007 – 6:40 am in Uncategorized, , , , , , ,

Tyco’s Parts One Week Later (TYC, TEL, COV, GE, MMM)

As you will see, so far the markets have greeted the post-Tyco with a bit of a thud.  This is one we were a bit cautious on the valuations as being fully valued and perhaps even having a phantom premium just because of the break-up itself.  Here you’ll see the pieces:

The remaining Tyco International Ltd. (TYC-NYSE) after a 1:4 reversesplit is down marginally at $53.00.  It opened at $52.92 Monday andhave managed to close up north of $53.00 per share each day since.Unfortunately each close has been slightly lower than the day before.

Tyco Electronics (TEL-NYSE) is trading at $39.30, barely above the opening price on Monday at $39.20.  Shares have briefly traded over $40.00 since the spin-off, but based on the trading activity it looks like the specialist was more than happy to give shares away there.

Covidien Ltd. (COV-NYSE) is up an entire penny today at $42.21 and have traded down from roughly a $43.00 open (conflicting opening prices).  It looks like the specialist was more than eager to give away shares at $43.00.

In all fairness, shares of other conglomerates haven’t exactly been lighting up the road: General Electric (GE-NYSE) has seen shares stuck in a $38.00 to $38.79 range for the last week, and 3M (MMM-NYSE) has seen only an $87.13 to $88.40 range in the same time.

Jon C. Ogg
July 6, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: July 6, 2007 – 10:19 am in Conglomerates, , , , ,

This Week’s Top Active Stock News Stories (June 22, 2007)

Stock Tickers: WB, GE, SMH, TYC, BRK/A, BX, SBUX, KFT, SIRI, XMSR, CAKE, BAM

Most stories come out, affect a stock or a sector, and then cease to matter.  We have numerous stories that started this week, but should be kept up for an active review because many of these will matter in the week or weeks ahead.

If you can believe it, Wachovia (WB) hit a new 52-week low today.  Where did that come from???? Speaking of, many of these ethanol stocks got a boost Friday because of a bill, but some of these were choking on year lows just two days ago.  General Electric (GE) was hitting a new multi-year high this week, as did the chip stock ETF called the Semiconductor HOLDRs (SMH); neither high held for the week, but these will both be areas to watch.

Tyco International (TYC) will still spit up as of the end of June and start trading for real rather than when-issued on July 2.  At this point, we aren’t all that impressed with the valuation hopes.

Poor Warren Buffett.  He’s the ‘Oracle of Omaha’ and the third richest man, with a great track record.  Yet short sellers are betting more gainst his positions and Jim Cramer gave a breakdown with his own opinion on 10 Buffett picks and then 10 more picks that are current Berkshire Hathaway (BRK/A) holdings.

 

Jim Cramer did something unique this week, and it wasn’t Eddie Lampert praise.  He endorsed the exceptionally performing Brookfield Asset Management (BAM-NYSE) as "The Next Berkshire Hathaway, but on more of an international and infrastructure basis."  Now I can personally vouch that this company is a beast and a great company, but it doesn’t matter what I have to say.  If that wasn’t just put on more long-term radars for traders to buy on weakness, then it would mean something went very wrong….

If you ask me, I don’t think it is ‘fair or balanced’ but the media is going after the Apple (AAPL-NASDAQ) iPhone.  Yep, the tide of hype and over-coverage has started creating a tough coverage and negative bias.  The stock should get a ’sell the event’ right before and after the iPhone launches next Friday, but it doesn’t seem like Steve Jobs has created the first dud for the company.  The media is trying to pawn it that way though. "None Dare Call It Conspiracy."

General Electric (GE-NYSE) is forking over $1 Million for a TV interview with Paris Hilton when she gets out of jail.  She should have to donate that money to MADD or to Tramps Anyonymous.  This is rewarding for bad behavior.

Blackstone (BX-NYSE) made it public, despite all the media gossip against the private equity behemoth.  They are now a force to be reckoned with, or ‘wreck-ened’ by if you get in their way.  Like you didn’t know that.  They even closed up at $35.06, above the $31.00 pricing.  KKR and Carlyle are said to be filing any day now.

Starbucks (SBUX-NASDAQ) on skid row.  It isn’t the coffee, it isn’t the merchandise.  It’s the point of their growth cycle versus the earnings multiple people will pay for it.

Kraft (KFT-NYSE) may have been be on its own for a few weeks now, but activist investor Nelson Peltz has taken a decent stake in the company.  You can be sure he’s going to be rattling the cages over there to drive shareholder value for the next year.  They don’t have to like him, but they’ll make money if they follow him! This one’s going to be live news for some time.

SIRIUS (SIRI-NASDAQ) and XM Satellite (XMSR-NASDAQ) are cranking up their efforts to get merger support.  It can’t be an accident that both shares were up close to 6% on Friday when the market was in the tubes.  Stay tuned.

We came up with a plan for Cheesecake factory (CAKE-NASDAQ) to fix what it got downgraded over this week.  We didn’t really call it a personal buyout pick, although that could be possible if the stock gets too much weaker after a thrashing Thursday.

Jon C. Ogg
June 22, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 22, 2007 – 4:16 pm in The Week, , , , , , , , , , , ,

Short Sellers Attack Restructure & Re-Org Stocks (June 2007)

Stock Tickers: TYC, MS, F, CY, SPWR, TRB, KFT, MO, HB, ASD, EMC, DJ, AA, WY

It is always interesting to see how short sellers treat shares of stocks that are undergoing a spin-off, a restructuring, or an organizational change.  Frequently you see large changes upand down as shareholder initiatives such as a spin-off, a corporate break-up, a questionable acquisition breaking apart, or a recapitalization can affect the street perception.  These also often take months or longer to come to fruition.  These are not all of the restructurings and spin-offs in NYSE-listed stocks, but these are a sample of the more watched deals.

Those with increased short selling…..

Tyco International (TYC), as it gets closer to its near-forever break-up into 3 units next week.  Tyco short interest grew from 20.89 million in May to 21.81 million in June.  Short sellers must not be seeing value just like we don’t.

Morgan Stanley (MS) as it gets ready to dump the poorest image image credit card in the country, Discover Card.  Morgan Stanley saw a 9% gain from May’s 10.2 million shares in the short interest grow to 11.16 million shares.

Ford (F), which is likely selling two units of Rover and Jaguar and might sell its finance business.  Ford saw a huge jump in short selling from 208.8 million in May to 214.1 million in June.  Ford shares are actually up 50% from the 52-week lows. believe it or not.

Cypress Semiconductor (CY) as some recent hope has come out for the company to unlock more value by unloading more of its holdings in SunPower Corp. (SPWR).  CY shares have seen an increased short selling from 13.89 million in May to 15.495 million in June, a gain of 10.3%.

Tribune (TRB) now that the Sam Zell privatization pilfering is closer.  The 6.1 million shares in May has grown to 6.88 million shares, a gain of more than 10% in short selling.

Kraft (KFT) and Altria (MO), now that the Kraft (KFT) spin-out has finally occurred and some more time has passed on the calendar.  MO saw a drop of 11% from 53.2 million shares down to 47.2 million shares, which could have been expected; and you saw the inverse move in KFT with may’s short interest of 32.14 million shares growing to 39.2 million shares in June.

Hillenbrand (HB) as it gets ready to split the medical products and beds from the casket unit.  Hillenbrand saw May’s short interest of 1.43 million shares grow 2% to 1.459 million shares in June.

The decliners….Not as active as the increases…..

American Standard (ASD), after its spin-off of WABCO. ASD saw a drop in its short short interest of 30% from 7.46 million shares down to 5.15 million shares in June.

EMC (EMC) as the company is closer to the spin-off date for VMWare, which is expected to be a hot IPO or spin-off issue.  EMC short interest was actually a decline of 6.5% from 38.93 million in May to 36.37 million in June.

Dow Jones (DJ) saw a drop in its shares in the short interest with May’s 5.78 million shares drop down to 4.94 million shares as financial betters didn’t want to increase their bets that the company would stay private.

Alcoa (AA), as prey or bait? Short sellers don’t want to find out.  May’s 16.8 million shares in the short interest fell to 14.68 million shares in June.

Weyerhaeuser (WY) saw its 9.16 million shares in its short interest drop to 7.76 million as investors are still thinking the value will unlock as a potential break-up, REIT-Conversion, or asset sales.

Jon C. Ogg
June 22, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 22, 2007 – 12:23 pm in Shareholder Issues, Short Interest, , , , , , , , , , , , , ,

Previewing Tyco Spin-Off Ahead of Analyst Meetings

Stock Tickers: TYC, COV, COV-WI, TEL, TEL-WI, GE

Tyco International Ltd. (TYC-NYSE) hosts its analyst meetings on Tuesday, June 19, to showcase its new spin-off companies.  Late last week we saw trading begin in the two spin-offs.  The "Tyco Healthcare" is named Covidien Ltd. and is trading under a when-issued ticker "COV" or on most symbols as "COV-WI."  The "Tyco Electronics unit" is appropriately named Tyco Electonics and trades as "TEL" or "TEL-WI."   The remaining company for all of the security and fire company is remaining Tyco International and keeping the "TYC" ticker.

Covidien (COV) closed out at $46.50 on Friday and Tyco Electronics (TEL) closed out at $38.80 on Friday.

In our free email newsletter we sent out last week, we noted that the break-up value for all of the combined Tyco International units could could fetch up to $36.00 or $37.00, but the stock was looking like it was set in a bumper car range of $32.00 to $35.00.  It just seems as though there is a phantom premium in the stock based solely on the actual spin-offs as an event rather than as the spin-offs’ true values.

Last week we also noted that Goldman Sachs had reiterated a "Buy" rating on the stock with a much more positive outlook.  Goldman noted that Tyco could even have a premium to their $35.00 target, which they even noted as ‘conservative.’    Our $36.00 to $37.00 note was sent on June 12 when the market was trading off, so the better stock market will be a boost for it.  Here was what we noted: If the market was not in a back-and-forth mode and if this wasn’t taking place into the 4th of July it might be a tad different.  But, only a tad.

A group of dissident bondholders late last week also noted that they are trying to get Tyco’s deal delayed, but the company said they remain on track after two delays already.  The company is also taking a $370 million after-tax charge this quarter related to sale of a power systems unit out of the electronics unit

We’ll send out more individual previews before and after the analyst meetings when we get to see the full presentations and hear what other plans are coming for each unit. 

Tyco trades too in-line with General Electric (GE) for the relative value to be incredibly higher than the market value of today, and shares have come up more than 36% from the lows over the last year before the spin-off was set in stone.

Jon C. Ogg
June 17, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 17, 2007 – 5:57 pm in Analyst Calls, Conglomerates, Mergers and Buy Outs, Shareholder Issues, , , , , ,

Pre-Market Stock News (June 13, 2007)

(AOB) American Oriental enters into a letter-of-intent to acquire an established plant based pharmaceutical company named Changchun Xinan Pharmaceutical Group for up to $30 million.
(CEN) Ceridian largest shareholder says the private equity buyout is underpriced.
(EBAY) eBay is still in court over this MercExchange LLC patent over its “Buy It Now” patent.
(F) Ford confirmed that it is reviewing sales of Jaguar and Rover; Goldman Sachs and others hired.
(GWR) Genesee & Wyoming reported a total carload decrease of 0.3%.
(GYI) Getty Images announced it has filed its 10-K for 2006.
(HS) Healthspring lowered guidance.
(LWSN) Lawson Software raised guidance to $0.05 to $0.07 EPS vs $0.04e.
(MAGS) Magal Security announced a new strategic partnership in Brazil for services providers.
(PAY) VeriFone Holdings announced it has been selected as the sole provider of electronic payment systems by the China Postal Savings Bank.
(POR) Portland General Electric announced the pricing of a 21 million share secondary at $26.00; seller is Enron Disputed Claims Reserve.
(SAPE) Sapient $0.07 EPS vs $0.01+e.
(SHLM) A. Schulman lowered guidance.
(SNY) Sanofi-Aventis diet drug all in one pill is being reviewed; already marketed as Acomplia in other countries.
(SSYS) Stratasys will replace LSS on S&P Small Cap 600 Index on June 14.
(TYC) Tyco will take a $500 Million pre-tax and $370 million after tax impairment charge for the sale of its Power Systems business.
(VLCM) Volcom will replace PXR on the S&P Small Cap 600 Index on June 15.

Jon C. Ogg
June 13, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: June 13, 2007 – 6:51 am in Pre-Market Activity, , , , , , , , , , , , , , , , ,

Warren Buffett Rides More Railroads (BNI, NSC, UNP), Plus Other Holdings

This is an edited version of the first story to run an expanded list. 

Last month we all found out that Warren Buffett’s Berkshire Hathaway decided to take a ride on the Reading by investing in Burlington Northern (BNI-NYSE).  He also said that he had invested in two others, and now we know the holdings out of today’s larger filing.  Here are the positions noted in the filing.

Here is a full list out of the SEC FILING:

Here are the rail positions: Burlington Northern (BNI), Norfolk Southern (NSC), Union Pacific (UNP).

American Express (AXP), American Standard (ASD), Ameriprise, Anheuser Busch (BUD), H&R Block (HRB),  Coca Cola (KO), Comdisco, ConocoPhillips (COP), Costco (COST), First Data (FDC), Gannett (GCI), General Electric (GE), Home Depot (HD), Ingersoll Rand (IR), Iron Mountain (IRM), J&J (JNJ), Lowe’s (LOW), M&T Bank (MTB), Moody’s (MCO), Nike (NKE),  PetroChina (PTR), Pier 1 Imports (PIR), P&G (PG),  Sanofi Aventis (SNY), Servicemaster (SVM), Sun Trust Banks (STI), Torchmark, Tyco International (TYC), US Bancorp (USB), USG Corp (USG), United Parcel Service (UPS), United Health group (UNH), Wal-Mart (WMT), Washington Post (WPO), Wells Fargo (WFC), Wellpoint (WLP), Wesco, Western Union (WU)

Jon C. Ogg
May 15, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.

Posted on: May 15, 2007 – 3:49 pm in Conglomerates, SEC, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

A General Electric Break-Up STILL a Bad Idea (GE)

The Wall Street Journal is reporting that there is still some shareholder pressure to break-up General Electric (GE-NYSE).  This is partly modeled on the ongoing Tyco (TYC-NYSE) break-up, but the idea is stupid and throws caution into the wind.

A couple weeks ago I was on CNBC noting that this was a bad idea.  That is still the case and a break-up of the conglomerate would be putting roughly 40 to 50 years of work to the wind merely for short-term gains.  The stock is up roughly 6% in the last year, but shares are up more than 50% since early 2003 when the economy started making its recovery.  You can go back and argue that share are flat since Immelt took the helm, but he took over the week before September 11, 2001 and right when the economy went into nosedive mode.  The following 18 months are not at all his fault.

Jet engines are a huge business right now, but it wasn’t that long ago that the jet maker was laying off thousands.  GE’s alternative energy and energy complex operations might not be able to be as robust as a standalone entity, particularly as many emerging market government are late or delinquent in payments.

Trust me on this.  This strategy is actually good if we are in a permanent bull market and if the investment community only wants to invest in growth companies.  But if investors want diversification and safety, this is a horrible idea.  The company is already making attempts to divest operations like plastics, and there are still plenty of acquisitions it can make.  There are some strategies that could unlock values with the issuance of a media tracking stock or the same in other areas, but a wholesale break-up is just not prudent.

Bull markets do always come to an end.  Great economies always fade eventually.  And there are some environments where safety is more important than a break-up to focus on growth segments.  Pressuring Jeff Immelt, who we noted as one of Americas most entrenched corporate leaders (and rightfully so), is not the right idea.

Jon C. Ogg
May 9, 2007

Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in any of the companies he covers.

Posted on: May 9, 2007 – 5:22 am in Conglomerates, ,