Cramer was discussing the resurgence of knee braces on sports players. He noted that orthopedic companies are going after companies, which the journal also said this. He said linemen are wearing these even when they don't need to.
DJ Orthopedics (DJO) makes these and he has recommended this name before. He isn't talking about orthopedics in general, he is talking about bracing. the air brace followed by the knee brace will keep you out of knee surgery. He said DJO is a one-stop pure play on this and everyone wants to avoid surgery.
Cramer thinks this goes a lot higher. He thinks there is the potential for brand recognition and these could be mass sold now. They had to outsource from New Jersey to Mexico manufacturing, so earnings may rise and the estimates are all over. He thinks it will raise estimates all year. If you use $2.10 for 2007 earnings it is only 21 times 2007 earnings. He said the multiple is lower than BMET and others, but the growth rate is higher.
DJO closed down 0.6% at $44.43 in regular trading, but its shares rose over 3% after-hours to $45.89 after Cramer touted. The 52-week trading range for DJO is $26.69 to $44.84.
Jon C. Ogg
November 17, 2006
Cramer Says DJ Orthopedics is a Good Crutch
Cramer was discussing the resurgence of knee braces on sports players. He noted that orthopedic companies are going after companies, which the journal also said this. He said linemen are wearing these even when they don't need to.
DJ Orthopedics (DJO) makes these and he has recommended this name before. He isn't talking about orthopedics in general, he is talking about bracing. the air brace followed by the knee brace will keep you out of knee surgery. He said DJO is a one-stop pure play on this and everyone wants to avoid surgery.
Cramer thinks this goes a lot higher. He thinks there is the potential for brand recognition and these could be mass sold now. They had to outsource from New Jersey to Mexico manufacturing, so earnings may rise and the estimates are all over. He thinks it will raise estimates all year. If you use $2.10 for 2007 earnings it is only 21 times 2007 earnings. He said the multiple is lower than BMET and others, but the growth rate is higher.
DJO closed down 0.6% at $44.43 in regular trading, but its shares rose over 3% after-hours to $45.89 after Cramer touted. The 52-week trading range for DJO is $26.69 to $44.84.
Jon C. Ogg
November 17, 2006
DJ Orthopedics (DJO) makes these and he has recommended this name before. He isn't talking about orthopedics in general, he is talking about bracing. the air brace followed by the knee brace will keep you out of knee surgery. He said DJO is a one-stop pure play on this and everyone wants to avoid surgery.
Cramer thinks this goes a lot higher. He thinks there is the potential for brand recognition and these could be mass sold now. They had to outsource from New Jersey to Mexico manufacturing, so earnings may rise and the estimates are all over. He thinks it will raise estimates all year. If you use $2.10 for 2007 earnings it is only 21 times 2007 earnings. He said the multiple is lower than BMET and others, but the growth rate is higher.
DJO closed down 0.6% at $44.43 in regular trading, but its shares rose over 3% after-hours to $45.89 after Cramer touted. The 52-week trading range for DJO is $26.69 to $44.84.
Jon C. Ogg
November 17, 2006
Cramer Say's Disney Was No Mickey Mouse; He Likes It
On tonight's MAD MONEY show on CNBC, Cramer went over a stock gift because it went down for no reason.
First he noted the NYMEX (NMX) IPO. He said it isn't the ideal entry point, but you should only buy 1/4 of a position of whatever you want to buy now and add in as it drops down. But Cramer said the NYSE (NYX) should be the buy right here since the NMX is worth $12 billion and NYX is worth $14 Billion. NYX is bigger and better.
The stock that was down for no reason to Cramer is Disney (DIS). He said it is down $3 since earnings, but this is a buy. He thinks that DIS's first down move might not be able to be trusted. They didn't really do anything wrong. They didn't miss earnings or revenues, prime time did well, but the reason it fell was because the estimates were raised a lot ahead right before the company's quarter was announced. That created an artificial comparable confusion on the street, but it is firing on every cylinder and even them parks did wellfor DIS. He thinks movie costs are coming under control, although Pirates II was over $200 million and Pirates III will be expensive too. ABC and Disney channel ratings are going up. While the street thinks Disney can't grow like this forever he thinks that NASCAR will be a huge add for it in 2007.
DIS closed down 0.35% at $32.94 in normal trading today, but shares rose 1.3% to $33.38 in after-hours trading.
Jon C. Ogg
November 17, 2006
First he noted the NYMEX (NMX) IPO. He said it isn't the ideal entry point, but you should only buy 1/4 of a position of whatever you want to buy now and add in as it drops down. But Cramer said the NYSE (NYX) should be the buy right here since the NMX is worth $12 billion and NYX is worth $14 Billion. NYX is bigger and better.
The stock that was down for no reason to Cramer is Disney (DIS). He said it is down $3 since earnings, but this is a buy. He thinks that DIS's first down move might not be able to be trusted. They didn't really do anything wrong. They didn't miss earnings or revenues, prime time did well, but the reason it fell was because the estimates were raised a lot ahead right before the company's quarter was announced. That created an artificial comparable confusion on the street, but it is firing on every cylinder and even them parks did wellfor DIS. He thinks movie costs are coming under control, although Pirates II was over $200 million and Pirates III will be expensive too. ABC and Disney channel ratings are going up. While the street thinks Disney can't grow like this forever he thinks that NASCAR will be a huge add for it in 2007.
DIS closed down 0.35% at $32.94 in normal trading today, but shares rose 1.3% to $33.38 in after-hours trading.
Jon C. Ogg
November 17, 2006
Market Wrap (Nov. 17, 2006)
DJIA 12,342.56; Up 36.74 (0.30%)
NASDAQ 2,445.86; Down 3.20 (0.13%)
S&P500 1,401.20; Up 1.44 (0.10%)
10YR-Bond 4.607%; Down 0.048
NYSE Volume 2,625,847,000
NASD Volume 1,708,761,000
This marked the 6th consecutive record close for the DJIA today. Hardly anyone bothered noting that today was options expiration date for stock options. Japan's Nikkei closed down 0.45%; FTSE 100 in U.K. closed down 1.01%; Germany's DAX index was down 0.48%; France's CAC-40 closed down 1.20%.
The big deal of the day was the NYMEX (NMX) IPO. Almost nothing else came close to it in coverage. It was such a ridiculous IPO pricing at $59.00, because it opened at $120 out of the chute and closed at $132.99.
The homebuilding numbers tracked by permits and housing starts were just too weak to ignore at first, but they mostly recovered throughout the day. Lennar (LEN) closed down only -0.2% at $49.30, DR Horton (DHI)rose 0.6% to $25.10, and KB Home (KBH) rose 0.5% to $49.07.
Lower oil prices yet again didn't phase many key oil stocks with Exxon Mobil (XOM) rose 0.55% to $73.08 and Oil Service HOLDRs (OIH) rose 0.8% to $136.85.
Conor Medsystems (CONR) rose 18% to $32.68 after J&J (JNJ) offered $33.50 to acquire the company. SurModics (SRDX) rapidly fell on the deal because they coat the J&J Cypher stent now, but they issued a release stating they would still be used and so the stock ran up to close up 7.75% to $34.49.
H-P (HPQ) shares slid 1.25% to $24.94 despite beating EPS targets, as guidance is in-line.
After yesterday's earnings, Starbucks (SBUX) fell 5.1% to $37.42 because guidance was essentially the same as in its recent analyst meeting. Its revenues were deemed a tad light, but it was really large profit taking after a huge run.
Under Armour (UARM) rose 0.65% to $46.55 after Cramer last night said that it offered upside from current levels along with Nike (NKE).
Marvell Tech (MRVL) fell 2.9% to $19.04 after posting a sequential revenue decline.
Google (GOOG) was reiterated a Buy with a $600 target at Citigroup, but it never was able to crack $500.00. Its high was $499.85, and it closed up 0.58% at $498.79.
First Solar (FSLR) priced its IPO at $20.00 and closed up at $24.74.
Sony (SNE) saw its ADR's in the US trade up 2.1% to $40.79 as its long-awaited PS3 hit stores today.
Altria (MO) rose 1.7% to $85.01 after raising guidance and as its "lights" case appears to have permenently gone in its favor.
Foot Locker (FL) fell 2.7% to $23.27 after reporting a 2 percent decline in its third-quarter profit, and after the chances of a buyout are nearly gone.
Advanced Magnetics (AMAG) rose a sharp 29.8% to $57.00 after it reported promising results from a late-stage clinical trial for an iron-replacement therapy for chronic kidney disease patients.
Have a great weekend!
Jon C. Ogg
November 17, 2006
NASDAQ 2,445.86; Down 3.20 (0.13%)
S&P500 1,401.20; Up 1.44 (0.10%)
10YR-Bond 4.607%; Down 0.048
NYSE Volume 2,625,847,000
NASD Volume 1,708,761,000
This marked the 6th consecutive record close for the DJIA today. Hardly anyone bothered noting that today was options expiration date for stock options. Japan's Nikkei closed down 0.45%; FTSE 100 in U.K. closed down 1.01%; Germany's DAX index was down 0.48%; France's CAC-40 closed down 1.20%.
The big deal of the day was the NYMEX (NMX) IPO. Almost nothing else came close to it in coverage. It was such a ridiculous IPO pricing at $59.00, because it opened at $120 out of the chute and closed at $132.99.
The homebuilding numbers tracked by permits and housing starts were just too weak to ignore at first, but they mostly recovered throughout the day. Lennar (LEN) closed down only -0.2% at $49.30, DR Horton (DHI)rose 0.6% to $25.10, and KB Home (KBH) rose 0.5% to $49.07.
Lower oil prices yet again didn't phase many key oil stocks with Exxon Mobil (XOM) rose 0.55% to $73.08 and Oil Service HOLDRs (OIH) rose 0.8% to $136.85.
Conor Medsystems (CONR) rose 18% to $32.68 after J&J (JNJ) offered $33.50 to acquire the company. SurModics (SRDX) rapidly fell on the deal because they coat the J&J Cypher stent now, but they issued a release stating they would still be used and so the stock ran up to close up 7.75% to $34.49.
H-P (HPQ) shares slid 1.25% to $24.94 despite beating EPS targets, as guidance is in-line.
After yesterday's earnings, Starbucks (SBUX) fell 5.1% to $37.42 because guidance was essentially the same as in its recent analyst meeting. Its revenues were deemed a tad light, but it was really large profit taking after a huge run.
Under Armour (UARM) rose 0.65% to $46.55 after Cramer last night said that it offered upside from current levels along with Nike (NKE).
Marvell Tech (MRVL) fell 2.9% to $19.04 after posting a sequential revenue decline.
Google (GOOG) was reiterated a Buy with a $600 target at Citigroup, but it never was able to crack $500.00. Its high was $499.85, and it closed up 0.58% at $498.79.
First Solar (FSLR) priced its IPO at $20.00 and closed up at $24.74.
Sony (SNE) saw its ADR's in the US trade up 2.1% to $40.79 as its long-awaited PS3 hit stores today.
Altria (MO) rose 1.7% to $85.01 after raising guidance and as its "lights" case appears to have permenently gone in its favor.
Foot Locker (FL) fell 2.7% to $23.27 after reporting a 2 percent decline in its third-quarter profit, and after the chances of a buyout are nearly gone.
Advanced Magnetics (AMAG) rose a sharp 29.8% to $57.00 after it reported promising results from a late-stage clinical trial for an iron-replacement therapy for chronic kidney disease patients.
Have a great weekend!
Jon C. Ogg
November 17, 2006
China Car Market: What If Everyone's Market Share Goes Up 100%
Stocks: (GM)(F)(TM)(HMC)
Toyota says that its market share in China should rise 30% next year to about 400,000 cars. Ford says its share there should double next year. It has sold 118,000 cars through October. GM says it will increase it current share in Asia from 6.5% to 10% with most of the unit increase coming in China.
None of this includes the plans of companies like Nissan, VW, or DaimlerChrysler. Not to mentions the locals.
Perhaps China is growing so fast that all of the major car companies can reach a share of 100% in the huge Asian country. But, if that doesn't work, someone is going to be disappointed.
You can count on it.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Toyota says that its market share in China should rise 30% next year to about 400,000 cars. Ford says its share there should double next year. It has sold 118,000 cars through October. GM says it will increase it current share in Asia from 6.5% to 10% with most of the unit increase coming in China.
None of this includes the plans of companies like Nissan, VW, or DaimlerChrysler. Not to mentions the locals.
Perhaps China is growing so fast that all of the major car companies can reach a share of 100% in the huge Asian country. But, if that doesn't work, someone is going to be disappointed.
You can count on it.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Cramer Evaluates How To Trade The NYMEX IPO Today
On today's STOP TRADING segment on CNBC at 2:45 PM EST, Jim Cramer reviewed how to trade off the NYMEX (NMX) IPO today.
Cramer said the NYMEX (NMX) IPO is over-extended at +140%, but he says if it gets to $120 or $110 then you can buy some. He said something is wrong with this picture. He said there was a tremendous media sensation for the IPO and they did leave a lot of money on the table, but they got rich anyway.
He thinks NYSE (NYX) is far cheaper. He said it went a little nutty, but it is not a return to dot.com values.
Cramer also endorsed Sears Holdings (SHLD) again, just like last night. He thinks that Eddie lampert should be allowed to invest the funds because he is a great investor.
Cramer called Conor Medsystems (CONR) is a second rate company that J&J (JNJ bought after CONR missed its quarter. He wants to know why people aren't buying Boston Scientific (BSX). He thinks BSX is done going down and it could go to $18 ot $19 when he discussed it.
Jon C. Ogg
November 17, 2006
Cramer said the NYMEX (NMX) IPO is over-extended at +140%, but he says if it gets to $120 or $110 then you can buy some. He said something is wrong with this picture. He said there was a tremendous media sensation for the IPO and they did leave a lot of money on the table, but they got rich anyway.
He thinks NYSE (NYX) is far cheaper. He said it went a little nutty, but it is not a return to dot.com values.
Cramer also endorsed Sears Holdings (SHLD) again, just like last night. He thinks that Eddie lampert should be allowed to invest the funds because he is a great investor.
Cramer called Conor Medsystems (CONR) is a second rate company that J&J (JNJ bought after CONR missed its quarter. He wants to know why people aren't buying Boston Scientific (BSX). He thinks BSX is done going down and it could go to $18 ot $19 when he discussed it.
Jon C. Ogg
November 17, 2006
The Real Market for PS3: eBay, For More than $2,000
Stock Ticker: SNE
OK, we all have seen the media covering the swarms and swarms of young adults waiting in line at electronics stores around the country waiting to get their hands on the Sony Play Station 3. We had note dthat these were being listed for $2,000 and $3,000 for the voucher on eBay last month. Well, the consoles are going for north of $2,000 on eBay right now.
This is supposed to be THE big console with limited supply, but I can't get past reading about how many of the systems do not integrate well with most of the older games and how many defects or glitches there were in pre-reviews this week. It was also pretty shocking when I was in a GameStop store two weeks ago and asking about the console and the younger adult working there said to be sure to give this at least 3 large series of US shipments to the U.S. before buying it so that the first machines with all the glitches had been worked out and the returned systems were out of the system. I asked how long that would really be and the guy said "4 to 6 months." Now one thing that may trim that time down by a month or so is that these for now are being flown in by air freight, or at least so Sony claims. That was a stun to me what someone whose job is supposed to be to sell these systems.
Take a look at what these are selling for on real bids on eBay as of 2:22 PM EST Today after typing in "PS3" search on eBay items:
OK, we all have seen the media covering the swarms and swarms of young adults waiting in line at electronics stores around the country waiting to get their hands on the Sony Play Station 3. We had note dthat these were being listed for $2,000 and $3,000 for the voucher on eBay last month. Well, the consoles are going for north of $2,000 on eBay right now.
This is supposed to be THE big console with limited supply, but I can't get past reading about how many of the systems do not integrate well with most of the older games and how many defects or glitches there were in pre-reviews this week. It was also pretty shocking when I was in a GameStop store two weeks ago and asking about the console and the younger adult working there said to be sure to give this at least 3 large series of US shipments to the U.S. before buying it so that the first machines with all the glitches had been worked out and the returned systems were out of the system. I asked how long that would really be and the guy said "4 to 6 months." Now one thing that may trim that time down by a month or so is that these for now are being flown in by air freight, or at least so Sony claims. That was a stun to me what someone whose job is supposed to be to sell these systems.
Take a look at what these are selling for on real bids on eBay as of 2:22 PM EST Today after typing in "PS3" search on eBay items:
9919 items found for
PS3
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Key Syndicate Deals for Thanksgiving Week
Stock Tickers: AER, SPR, TM, INFY, NMX
We have a couple deals to watch for next week, but since it is Thanksgiving week you can expected everything to come Monday night for Tuesday trading.
Most of the A-Team trading desks are vaceant either all of Wednesday ahead of thanksgiving or at least after the first hour. Friday is a joke of a trading day and to the best of my knowledge there has never been any syndicate deal "purposely" on that trading day in the US.
Two IPO's to watch are AerCap Holdings N.V. (AER) and Spirit Aerosystems (SPR).
Aercap (AER)is a Dutch holder of aircrafts it leases out, and it sells and leases parts, engines, and services. This is an awaited IPO for US investors for what looks to be 26.1 million shares (about 2/3 being sold by insdiders) at a $22.00 to $24.00 range. This offering is led by Goldman Sachs, Lehman, Merrill Lynch and Morgan Stanley.
Spirit erosystems (SPR) will also price Monday night. It has some 52 million shares coming at a range of $23.00 to $25.00. Spirit's IPO is being led by Goldman Sachs, Morgan Stanley, and Credit Suisse. Spirit AeroSystems was created in 2005 when Canadian investment group Onex bought Boeing's (BA) Wichita and Oklahoma assets in a $1.5 billion cash and debt transaction. Onex officials had said their plan was to take Spirit public within five years, but this is 1 year and some change as the market and economy accomodate now.
We also have two secondaries to watch, and these are also set for Monday night. Toyota MOtors (TM) has a potential offering next week, but there has actually been very little buzz ahead of the deal so that may or may not be the case. Details on that will have to wait until Monday. Infosys Tech (INFY) out of India is supposedly having a $1.5 Billion share sale in the secondary market, although this has been approved since the start of November for up to 30 million ADR shares to be sold, which is supposedly to increase ownership of Infosys in the U.S.
There are other deals on the books, but these are the important ones to watch. Stay tuned Monday and Tuesday.
After slamming the crummy pricing job from the underwriters on the NYMEX (NMX) IPO this morning, I did manage in my rant to forget to at least congratulate the NYMEX seat holders. They all had 90,000 shares per NYMEX seat, so they just got to add a substantial amount to their "soon-to-be" liquid net worth.
Jon C. Ogg
November 17, 2006
We have a couple deals to watch for next week, but since it is Thanksgiving week you can expected everything to come Monday night for Tuesday trading.
Most of the A-Team trading desks are vaceant either all of Wednesday ahead of thanksgiving or at least after the first hour. Friday is a joke of a trading day and to the best of my knowledge there has never been any syndicate deal "purposely" on that trading day in the US.
Two IPO's to watch are AerCap Holdings N.V. (AER) and Spirit Aerosystems (SPR).
Aercap (AER)is a Dutch holder of aircrafts it leases out, and it sells and leases parts, engines, and services. This is an awaited IPO for US investors for what looks to be 26.1 million shares (about 2/3 being sold by insdiders) at a $22.00 to $24.00 range. This offering is led by Goldman Sachs, Lehman, Merrill Lynch and Morgan Stanley.
Spirit erosystems (SPR) will also price Monday night. It has some 52 million shares coming at a range of $23.00 to $25.00. Spirit's IPO is being led by Goldman Sachs, Morgan Stanley, and Credit Suisse. Spirit AeroSystems was created in 2005 when Canadian investment group Onex bought Boeing's (BA) Wichita and Oklahoma assets in a $1.5 billion cash and debt transaction. Onex officials had said their plan was to take Spirit public within five years, but this is 1 year and some change as the market and economy accomodate now.
We also have two secondaries to watch, and these are also set for Monday night. Toyota MOtors (TM) has a potential offering next week, but there has actually been very little buzz ahead of the deal so that may or may not be the case. Details on that will have to wait until Monday. Infosys Tech (INFY) out of India is supposedly having a $1.5 Billion share sale in the secondary market, although this has been approved since the start of November for up to 30 million ADR shares to be sold, which is supposedly to increase ownership of Infosys in the U.S.
There are other deals on the books, but these are the important ones to watch. Stay tuned Monday and Tuesday.
After slamming the crummy pricing job from the underwriters on the NYMEX (NMX) IPO this morning, I did manage in my rant to forget to at least congratulate the NYMEX seat holders. They all had 90,000 shares per NYMEX seat, so they just got to add a substantial amount to their "soon-to-be" liquid net worth.
Jon C. Ogg
November 17, 2006
Anatomy of a Mispriced IPO: NYMEX (NMX)
Stock Tickers: NMX
$120.00 was the opening print for NYMEX (NMX). While there may be cheers here from the floor, this is ludicrous and obscene as far as a mispricing. I am not referring to the valuation or the stock price in and of itself, because the market is the mechanism that initially determines a fair and current price. But what is ludicrous is that the lead underwriters in charge of pricing are relied upon by a company coming public to determine a fair and equal pre-set pricing. NYMEX was told that the fair price on that was $59.00, above the raised ranges. For the first print out of the chute to be $120.00 you can rest assured that NYMEX was just boinked and a lot of IPO cash just got left on the table.
Investors that take the risk in getting IPO allocations do not deserve a 100% return instantly out of the chute for the first print after an IPO pricing. There was no history there, and there is very little risk. If you were allocated IPO shares at $59.00 on NYMEX, then you are allocated IPO shares to enough IPO's that even when you factor in pigs thatfall 20% in a day you make out like a bandit.
I am not a socialist and don't even call out for more and more never-ending market reform to protect Grandma Jones, but when you see this it is obscene. No doubt about it. If you were James Newsome, the CEO of NYMEX, you have to act happy on the floor like he just did on a quick CNBC interview, but you know he is going to go back to his office and call those investment bankers more four letter words than can be thought of. If not, then it is because of shell shock.
There have been lawsuits over this practice in the past where on dot.com IPO's in 1998 to 2000 where shares priced at $28.00 as "the max the market can bare" and then the first print is $100.00 or more. Imagine how much the dot.com bubble may have been better contained if the street actually priced deals at a fair market price. Milton Friedman is the man I recall saying the equivalent of "money is worth whatever people think it is worth," but I bet right now he would be asking the underwriters how $59.00 on a well known commodity is instantly worth $120.00 or more.
I won't even go into how this also destabilizes a market on a stock and the related companies. You never know where this IPO will close today. It could close at $175.00 or it could close at $90.00, although these are just theoretical numbers at this point. Since the open, there was even a $152.00 print, although it is back at $135.00 as I load the story and prints have been all over the place.
The Dutch Auction route for IPO's has been slammed in the past, but this makes a better and better case for it if you are an established name brand coming public. W.R.Hambrecht and its OpenIPO mechanism have often not been well received by the public and the deals are snubbed by the bulge bracket firms because it denounces how they operate, but it is probably assumed that the Hambrecht investment bankers are calling any large company out there on the IPO docket right now pointing out how much money was just left on the table by sticking with the "Good Ol' Boys."
Shares of InterContinental Exchange (ICE) have traded in a $93.90 to $98.45 range today and shares of Chicago Mercantile Exchange (CME) have traded in a $533.50 to $546.98 range today. If you wonder why researchers sometimes point out that a monkey throwing darts at a board or randomly picking names can outperform actual stock pickers sometimes, this may demonstrate part of the theory.
There is no reason to beat a dead horse (or a dead money) over and over here, but I think the point has been made.
Jon C. Ogg
November 17, 2006
$120.00 was the opening print for NYMEX (NMX). While there may be cheers here from the floor, this is ludicrous and obscene as far as a mispricing. I am not referring to the valuation or the stock price in and of itself, because the market is the mechanism that initially determines a fair and current price. But what is ludicrous is that the lead underwriters in charge of pricing are relied upon by a company coming public to determine a fair and equal pre-set pricing. NYMEX was told that the fair price on that was $59.00, above the raised ranges. For the first print out of the chute to be $120.00 you can rest assured that NYMEX was just boinked and a lot of IPO cash just got left on the table.
Investors that take the risk in getting IPO allocations do not deserve a 100% return instantly out of the chute for the first print after an IPO pricing. There was no history there, and there is very little risk. If you were allocated IPO shares at $59.00 on NYMEX, then you are allocated IPO shares to enough IPO's that even when you factor in pigs thatfall 20% in a day you make out like a bandit.
I am not a socialist and don't even call out for more and more never-ending market reform to protect Grandma Jones, but when you see this it is obscene. No doubt about it. If you were James Newsome, the CEO of NYMEX, you have to act happy on the floor like he just did on a quick CNBC interview, but you know he is going to go back to his office and call those investment bankers more four letter words than can be thought of. If not, then it is because of shell shock.
There have been lawsuits over this practice in the past where on dot.com IPO's in 1998 to 2000 where shares priced at $28.00 as "the max the market can bare" and then the first print is $100.00 or more. Imagine how much the dot.com bubble may have been better contained if the street actually priced deals at a fair market price. Milton Friedman is the man I recall saying the equivalent of "money is worth whatever people think it is worth," but I bet right now he would be asking the underwriters how $59.00 on a well known commodity is instantly worth $120.00 or more.
I won't even go into how this also destabilizes a market on a stock and the related companies. You never know where this IPO will close today. It could close at $175.00 or it could close at $90.00, although these are just theoretical numbers at this point. Since the open, there was even a $152.00 print, although it is back at $135.00 as I load the story and prints have been all over the place.
The Dutch Auction route for IPO's has been slammed in the past, but this makes a better and better case for it if you are an established name brand coming public. W.R.Hambrecht and its OpenIPO mechanism have often not been well received by the public and the deals are snubbed by the bulge bracket firms because it denounces how they operate, but it is probably assumed that the Hambrecht investment bankers are calling any large company out there on the IPO docket right now pointing out how much money was just left on the table by sticking with the "Good Ol' Boys."
Shares of InterContinental Exchange (ICE) have traded in a $93.90 to $98.45 range today and shares of Chicago Mercantile Exchange (CME) have traded in a $533.50 to $546.98 range today. If you wonder why researchers sometimes point out that a monkey throwing darts at a board or randomly picking names can outperform actual stock pickers sometimes, this may demonstrate part of the theory.
There is no reason to beat a dead horse (or a dead money) over and over here, but I think the point has been made.
Jon C. Ogg
November 17, 2006
It’s That Time of Year for Intuit
By William Trent, CFA of Stock Market Beat
Last month we pointed out that Intuit (INTU) tends to trade in a seasonal pattern, with the annual price peak occurring late in the calendar year. True to form, the stock was down after hours after Intuit reported earnings for their first fiscal quarter yesterday:
Intuit Inc. (Nasdaq:INTU - News) today announced its first-quarter 2007 revenue increased 19 percent over the year-ago quarter to $362.1 million. Growth was primarily driven by strong sales of its QuickBooks software and add-on solutions, payroll and payments. Approximately $20 million of first-quarter revenue was attributed to the September launch of QuickBooks 2007, which was about 30 days earlier than last year. Without this earlier launch, revenue growth would have been approximately 12 percent.
Forward-looking Guidance
Intuit reaffirmed its previously-given revenue and earnings per share guidance for the second quarter of fiscal 2007 and provided operating income guidance for the first time. Intuit expects:
* Revenue of $743 million to $760 million, or year-over-year growth of 0 percent to 2 percent.* GAAP operating income of $185 million to $204 million, and non-GAAP operating income of $211 million to $230 million.* GAAP diluted earnings per share, or EPS, of $0.34 to $0.37, and non-GAAP diluted EPS of $0.39 to $0.42.
Intuit also reaffirmed its previously given third quarter, fourth quarter, and full year fiscal 2007 guidance for revenue and earnings per share, details of which are available on Intuit’s Web site at www.intuit.com/about_intuit/investors/earnings/2006/.
The guidance was slightly below consensus expectations, but that’s what the consensus gets for making estimates outside the high end of management’s guidance range. We bought put options following our earlier article, and still own them. It’s another one of those things that worked the way we expected it to.
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
Last month we pointed out that Intuit (INTU) tends to trade in a seasonal pattern, with the annual price peak occurring late in the calendar year. True to form, the stock was down after hours after Intuit reported earnings for their first fiscal quarter yesterday:
Intuit Inc. (Nasdaq:INTU - News) today announced its first-quarter 2007 revenue increased 19 percent over the year-ago quarter to $362.1 million. Growth was primarily driven by strong sales of its QuickBooks software and add-on solutions, payroll and payments. Approximately $20 million of first-quarter revenue was attributed to the September launch of QuickBooks 2007, which was about 30 days earlier than last year. Without this earlier launch, revenue growth would have been approximately 12 percent.
Forward-looking Guidance
Intuit reaffirmed its previously-given revenue and earnings per share guidance for the second quarter of fiscal 2007 and provided operating income guidance for the first time. Intuit expects:
* Revenue of $743 million to $760 million, or year-over-year growth of 0 percent to 2 percent.* GAAP operating income of $185 million to $204 million, and non-GAAP operating income of $211 million to $230 million.* GAAP diluted earnings per share, or EPS, of $0.34 to $0.37, and non-GAAP diluted EPS of $0.39 to $0.42.
Intuit also reaffirmed its previously given third quarter, fourth quarter, and full year fiscal 2007 guidance for revenue and earnings per share, details of which are available on Intuit’s Web site at www.intuit.com/about_intuit/investors/earnings/2006/.
The guidance was slightly below consensus expectations, but that’s what the consensus gets for making estimates outside the high end of management’s guidance range. We bought put options following our earlier article, and still own them. It’s another one of those things that worked the way we expected it to.
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
Hewlett Packard (HPQ)
By William Trent, CFA of Stock Market Beat
Hewlett Packard (HPQ) shares were off slightly after reporting that earnings beat consensus estimates - if you are willing to view their recurrent restructuring charges as non-recurring. While they have had their share of troubles this quarter, you have to hand it to them for reporting at all, the way things are going in tech-land (with everyone either delaying their report or giving partial data while being investigated by the SEC.)
Revenues grew 7% year/year. That is not an exciting number, but at least it is better than some others we have seen.
Inventories grew faster than sales, which management explained on the conference call thusly:
Next, the balance sheet. HP’s inventory came in at $7.8 billion, up $873 million year over year and up $286 million sequentially. Inventory days of supply stands at 38 days, up from 35 days last year and down from 41 days sequentially. The year-over-year increase in inventory reflects volume growth, strategic buys and supply chain changes designed to optimize our cost structure. The sequential increase is in line with normal seasonality.
We’re still a little skeptical, but the explanation is within the bounds of reason. Again, while not a major concern it was nothing to brag about.
Overall, we agree with the after-market response to the report. This was a decent but unspectacular quarter for Hewlett Packard.
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
Hewlett Packard (HPQ) shares were off slightly after reporting that earnings beat consensus estimates - if you are willing to view their recurrent restructuring charges as non-recurring. While they have had their share of troubles this quarter, you have to hand it to them for reporting at all, the way things are going in tech-land (with everyone either delaying their report or giving partial data while being investigated by the SEC.)
Revenues grew 7% year/year. That is not an exciting number, but at least it is better than some others we have seen.
Inventories grew faster than sales, which management explained on the conference call thusly:
Next, the balance sheet. HP’s inventory came in at $7.8 billion, up $873 million year over year and up $286 million sequentially. Inventory days of supply stands at 38 days, up from 35 days last year and down from 41 days sequentially. The year-over-year increase in inventory reflects volume growth, strategic buys and supply chain changes designed to optimize our cost structure. The sequential increase is in line with normal seasonality.
We’re still a little skeptical, but the explanation is within the bounds of reason. Again, while not a major concern it was nothing to brag about.
Overall, we agree with the after-market response to the report. This was a decent but unspectacular quarter for Hewlett Packard.
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
Oil Revisited
By William Trent, CFA of Stock Market Beat
When we last visited the oil patch, we found the arguments against higher oil prices lacking. It remains our view that demand for oil is rising at a faster pace than supplies of oil, and that the imbalance will be solved through the price mechanism. We don’t think the correction is even close to done.
However, an article we found in Oil & Gas Journal titled CERA study challenges ‘peak oil’ theory suggested it was time to update our analysis.
The article states:
The “peak oil” theory, stipulating that world oil production will soon peak and sharply decline, is flawed, according to an analysis by Cambridge Energy Research Associates (CERA).
Instead of a peak, CERA says, production is more likely to trace an “undulating plateau” that will last for a decade or more beyond 2030.
It seems of little consequence to us, as we believe demand will continue to rise without further drastic discouragement through higher prices. Whether supply is declining or flat, it will not keep pace with demand. The article continues:
The CERA report contends that the often-cited Hubbert model, which patterns production as a bell curve, fails to recognize that recoverable reserve estimates evolve with time and are subject to significant change. The model also underplays the impact of technological advances.
Although M. King Hubbert accurately predicted timing of the peak in US Lower 48 oil production in 1970, the CERA study says, he underestimated the peak rate by 20% and total cumulative Lower 48 production during 1970-2005 by 15 billion bbl.
Again, not exactly right is likely to be close enough for our theory to play out.
With the recent drop in prices, days of inventory made a run at breaking out of the long-term downtrend. However, the breakout failed and stocks remain low compared to long-term averages.
We’ll stick to our long position in the oil ETF (USO).
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
When we last visited the oil patch, we found the arguments against higher oil prices lacking. It remains our view that demand for oil is rising at a faster pace than supplies of oil, and that the imbalance will be solved through the price mechanism. We don’t think the correction is even close to done.
However, an article we found in Oil & Gas Journal titled CERA study challenges ‘peak oil’ theory suggested it was time to update our analysis.
The article states:
The “peak oil” theory, stipulating that world oil production will soon peak and sharply decline, is flawed, according to an analysis by Cambridge Energy Research Associates (CERA).
Instead of a peak, CERA says, production is more likely to trace an “undulating plateau” that will last for a decade or more beyond 2030.
It seems of little consequence to us, as we believe demand will continue to rise without further drastic discouragement through higher prices. Whether supply is declining or flat, it will not keep pace with demand. The article continues:
The CERA report contends that the often-cited Hubbert model, which patterns production as a bell curve, fails to recognize that recoverable reserve estimates evolve with time and are subject to significant change. The model also underplays the impact of technological advances.
Although M. King Hubbert accurately predicted timing of the peak in US Lower 48 oil production in 1970, the CERA study says, he underestimated the peak rate by 20% and total cumulative Lower 48 production during 1970-2005 by 15 billion bbl.
Again, not exactly right is likely to be close enough for our theory to play out.
With the recent drop in prices, days of inventory made a run at breaking out of the long-term downtrend. However, the breakout failed and stocks remain low compared to long-term averages.
We’ll stick to our long position in the oil ETF (USO).
The author may hold a position in the securities discussed.
The author's current holdings are as follows: Long: Intuit (INTU) put options; Nasdaq 100 (QQQQ) put options; Bookham (BKHM; Ballard Power (BLDP); Syntax Brillian (BRLC); CMGI (CMGI); Genentech (DNA); Ion Media Networks (ION); Lion's Gate (LGF); Three Five Systems (TFS); Adobe Systems (ADBE) call options; Ceradyne (CRDN); IShares Japan (EWJ); StreetTracks Gold (GLD); Starbucks (SBUX); U.S. Oil Fund (USO); Plantronics (PLT) call options; Short: Lion's Gate (LGF) call options; Dell (DELL) put options; Ceradyne (CRDN) call options; Plantronics (PLT) put options.
http://stockmarketbeat.com/blog1/
NYMEX Debuts, Watch Other Exchanges Too
NYMEX (NMX) did price its long-awaited and well above average demand IPO. It priced 6.5 million shares at $59.00. The original terms were 6 million shares at $48.00 to $52.00, and then was bumped to 6.5 million shares with a higher $54.00 to $57.00 range. The deal was definitely set to price higher because of all the exchange hype, but it would seem that there is some money being left on the table here.
It is definitely discussed as having a premium to its above the already raised range, but the question remains as to how much higher. Some are thinking $5.00 higher, some $10.00 higher, and Jim Cramer even said he thinks it is a buy at $20.00 higher (from the $57 area anyway). The opening print will be one to watch regardless. The first indications were for $78 to $80, but who knows if that is right or real.
Sorry for the lack of a background on the NYMEX, but it has been covered so much that it would seem like it is from the Department of Redundancy Department.
InterContinental Exchange (ICE) is trading up 0.6% at $95.20 pre-market, and it is up from under $85.00 just last Friday. NYSE (NYX) is trading up 0.25% at $94.01 pre-market, although that is only about $1.00 than last Friday. The Chicago Mercantile Exchange (CME) is up 0.55% at $543.00 pre-market, and that stock was actually under $500.00 last Friday. NASDAQ (NDAQ) stock is flat pre-market at $36.45 and is actually in-line to under where it was last Friday. Some of these other exchanges have enjoyed some serious runs in the last week, so it makes you wonder what will happen to them after the NYMEX IPO prices.
Other potentially related shares that could get secondary or tertiary actions if this just gets ridiculous are the following: Investment Technology Group (ITG), eSpeed (ESPD), and International Securities Exchange (ISE), OptionsXpress (OXPS), MarketAccess (MKTX) and others.
Get ready for a wild day in exchange stocks trading.
Jon C. Ogg
November 17, 2006
It is definitely discussed as having a premium to its above the already raised range, but the question remains as to how much higher. Some are thinking $5.00 higher, some $10.00 higher, and Jim Cramer even said he thinks it is a buy at $20.00 higher (from the $57 area anyway). The opening print will be one to watch regardless. The first indications were for $78 to $80, but who knows if that is right or real.
Sorry for the lack of a background on the NYMEX, but it has been covered so much that it would seem like it is from the Department of Redundancy Department.
InterContinental Exchange (ICE) is trading up 0.6% at $95.20 pre-market, and it is up from under $85.00 just last Friday. NYSE (NYX) is trading up 0.25% at $94.01 pre-market, although that is only about $1.00 than last Friday. The Chicago Mercantile Exchange (CME) is up 0.55% at $543.00 pre-market, and that stock was actually under $500.00 last Friday. NASDAQ (NDAQ) stock is flat pre-market at $36.45 and is actually in-line to under where it was last Friday. Some of these other exchanges have enjoyed some serious runs in the last week, so it makes you wonder what will happen to them after the NYMEX IPO prices.
Other potentially related shares that could get secondary or tertiary actions if this just gets ridiculous are the following: Investment Technology Group (ITG), eSpeed (ESPD), and International Securities Exchange (ISE), OptionsXpress (OXPS), MarketAccess (MKTX) and others.
Get ready for a wild day in exchange stocks trading.
Jon C. Ogg
November 17, 2006
GM Boasts About Asia (GM)(HMC)(F)(TM)(DX)
US car executives cannot keep bragging about how well they will do in Asia. GM is now saying it believes it can raise its share in the region from 6.5% to 10% by 2010.
Those looking for a reason for the optimism won't find any. GM makes the statment but has nothing to back it up.
What GM wants Wall St. to believe that cars and small trucks that are bested by vehicles from Toyota and Honda in the US market will do better overseas. Toyota, Honda, VW, Nissan, Ford, Daimler and a pack of other companies want the share as much as GM does.
In 1995, GM's US share was nearly 33%. By 2005, it had fallen to just above 26%. And, Toyota is still gaining share in GM's home market.
Asia, of course, will be different. There GM's models will level Toyota, Honda, and local car company offerings.
When pigs fly.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Those looking for a reason for the optimism won't find any. GM makes the statment but has nothing to back it up.
What GM wants Wall St. to believe that cars and small trucks that are bested by vehicles from Toyota and Honda in the US market will do better overseas. Toyota, Honda, VW, Nissan, Ford, Daimler and a pack of other companies want the share as much as GM does.
In 1995, GM's US share was nearly 33%. By 2005, it had fallen to just above 26%. And, Toyota is still gaining share in GM's home market.
Asia, of course, will be different. There GM's models will level Toyota, Honda, and local car company offerings.
When pigs fly.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Pre-Market Stock News (Nov. 17, 2006)
(ADSK) Autodesk revenues $457M vs $457.25M(e); guides inline; subscription revenues up 50%; stock rose 5%.
(AME) Ametek gets positive radiation detection article from Business Week.
(AMED) Amedisys 3M share secondary priced at $41.50.
(ANN) Ann Taylor $0.54 EPS vs $0.52e.
(AW) Allied Waste 33M share secondary priced at $12.75.
(CHFN) Charter Financial announced self tender of 1M shares at $43 low and $52 high.
(CONR) Conor Medsystems trading up 19%as J&J gives it a $33.50 buyout.
(CPWM) Cost Plus -$0.53 EPS vs -$0.45e; sees Q4 $0.84-1.03 vs $1.09e.
(CTRN) Citi Trends $0.20 EPS vs $0.16e.
(DNA) Genetech wins additional breast cancer expanded use from FDA.
(EGLT) Eagle Test Systems $0.44 EPS vs $0.36e.
(EXEL) Exelixis billary tract tumor phase III study halted.
(FSLR) First Solar 20M share IPO priced at $20.00.
(GPS) Gap Stores $0.23 EPS vs $0.22e;
(HAL) Halliburton noted positively in Barron's Online.
(HIBB) Hibbett Sporting Goods $0.31 EPS vs $0.28e.
(HPQ) Hewlett-Packard $0.68 EPS vs $0.64e; SEC formally investigates board over pre-texting scandal.
(INTU) Intuit -$0.12 EPS vs -$0.12e.
(ISIS) Isis Pharma gets positive drug article in Business Week.
(MRVL) Marvell trading down 5% after results and guidance; still delaying quarterly filings.
(NMX) NYMEX 6.5M share IPO priced at $59.00, above the alreadty raised $54 to $57 range.
(NRF) Northstar Realty 16M share secondary priced at $14.95.
(NWACQ) Northwest Airlines positive article as buyout candidate in Business Week.
(ORH) Odyssey Re filed to sell 9M shares.
(PLSB) Placer Sierra Banc losing #1 mortgage depositor by June of 2007; 12.6% of total deposits and 30.2% of non-interest bearing deposits.
(RDY) Dr. Reddy's 12.5M share secondary priced at $16.00, yesterday's close was $16.45.
(SBUX) Starbucks trading down 7% as revenues were a hair light and guidance was same as before.
(SJM) J.M.Smucker $0.83 EPS vs $0.85e.
(SVM) Service master holder reportedly asking company to seek a buyer.
(VITA) Orthovita 7.7M share secondary priced at $3.25.
(VQ) Venoco IPO priced 12.5M shares at $17.00, under the $19 to $21 range.
(VTAL) Vital Images 3M share secondary priced at $31.00.
(XIDE) Exide filed to sell 28M shares.
(YHOO) Yahoo! buys BIX.COM (private) to allow users and advertisers to judge contests.
(AME) Ametek gets positive radiation detection article from Business Week.
(AMED) Amedisys 3M share secondary priced at $41.50.
(ANN) Ann Taylor $0.54 EPS vs $0.52e.
(AW) Allied Waste 33M share secondary priced at $12.75.
(CHFN) Charter Financial announced self tender of 1M shares at $43 low and $52 high.
(CONR) Conor Medsystems trading up 19%as J&J gives it a $33.50 buyout.
(CPWM) Cost Plus -$0.53 EPS vs -$0.45e; sees Q4 $0.84-1.03 vs $1.09e.
(CTRN) Citi Trends $0.20 EPS vs $0.16e.
(DNA) Genetech wins additional breast cancer expanded use from FDA.
(EGLT) Eagle Test Systems $0.44 EPS vs $0.36e.
(EXEL) Exelixis billary tract tumor phase III study halted.
(FSLR) First Solar 20M share IPO priced at $20.00.
(GPS) Gap Stores $0.23 EPS vs $0.22e;
(HAL) Halliburton noted positively in Barron's Online.
(HIBB) Hibbett Sporting Goods $0.31 EPS vs $0.28e.
(HPQ) Hewlett-Packard $0.68 EPS vs $0.64e; SEC formally investigates board over pre-texting scandal.
(INTU) Intuit -$0.12 EPS vs -$0.12e.
(ISIS) Isis Pharma gets positive drug article in Business Week.
(MRVL) Marvell trading down 5% after results and guidance; still delaying quarterly filings.
(NMX) NYMEX 6.5M share IPO priced at $59.00, above the alreadty raised $54 to $57 range.
(NRF) Northstar Realty 16M share secondary priced at $14.95.
(NWACQ) Northwest Airlines positive article as buyout candidate in Business Week.
(ORH) Odyssey Re filed to sell 9M shares.
(PLSB) Placer Sierra Banc losing #1 mortgage depositor by June of 2007; 12.6% of total deposits and 30.2% of non-interest bearing deposits.
(RDY) Dr. Reddy's 12.5M share secondary priced at $16.00, yesterday's close was $16.45.
(SBUX) Starbucks trading down 7% as revenues were a hair light and guidance was same as before.
(SJM) J.M.Smucker $0.83 EPS vs $0.85e.
(SVM) Service master holder reportedly asking company to seek a buyer.
(VITA) Orthovita 7.7M share secondary priced at $3.25.
(VQ) Venoco IPO priced 12.5M shares at $17.00, under the $19 to $21 range.
(VTAL) Vital Images 3M share secondary priced at $31.00.
(XIDE) Exide filed to sell 28M shares.
(YHOO) Yahoo! buys BIX.COM (private) to allow users and advertisers to judge contests.
Select Analyst Calls (Nov. 17, 2006)
AAP raised to Buy at Oppenheimer.
ADBE cut to Neutral at Oppenheimer.
ADSK reitr Buy at Jeffeires.
ALOG started as Hold at Jefferies.
APSG started as Hold at Jefferies.
AQR started as Buy at ThinkEquity.
BOBJ cut to Hold at Deutsche Bank.
CBF started as Mkt Perform at Wachovia.
CCI raised to Outperform at RBC.
CCRT started as Outperform at KBW.
CFC started as Sell at Goldman Sachs.
CFR raised to Outperform at Piper Jaffray.
CNQR started as Buy at Deutsche Bank.
COLM raised to Buy at B of A.
CPWM cut to Underperform at Raymond James.
DVAX raised to Outperform at Bear Stearns.
FNM & FRE started as Neutral at Goldman Sachs.
FORM started as Buy at Merrill Lynch.
FUL raised to Overweight at JPMorgan.
GOOG reitr Buy/$600 tgt at Citigroup.
INFY started as Outperform at Wachovia.
INTU cut to Mkt Perform at William Blair, cut to Accumulate at ThinkEquity.
INWK cut to Equal Weight at Morgan Stanley.
ITG raised to Overweight at JPMorgan.
LPNT started as Hold at Citigroup.
MEL raised to Overweight at Prudential.
MDTH started as Buy at Deutsche Bank, started as Outperform at Wachovia.
MNST cut to Hold at Citigroup.
MRVL cut to Underweight at Prudential.
NCC cut to Underweight at Prudential.
NGG cut to Sell at Citigroup.
NIHD started as Buy at Citigroup.
REP cut to Reduce at UBS.
SHMR cut to Sector Perform at CIBC.
SYNT started as Outperform at Wachovia.
THC started as Sell at Citigroup.
TIN cut to Hold at Deutsche Bank.
TLEO started as Buy at Deutsche Bank.
UHS started as Buy at Citigroup.
UNS started as Overweight at JPMorgan.
WIT started as Mkt Perform at Wachovia.
WSM cut to Hold at BB&T.
WY cut to Hold at Deutsche Bank.
WYNN cut to Hold at Citigroup.
XLNX cut to Peer Perform at Bear Stearns.
XOM cut to Mkt Perform at Bernstein.
YHOO raised to Buy at Oppenheimer.
ADBE cut to Neutral at Oppenheimer.
ADSK reitr Buy at Jeffeires.
ALOG started as Hold at Jefferies.
APSG started as Hold at Jefferies.
AQR started as Buy at ThinkEquity.
BOBJ cut to Hold at Deutsche Bank.
CBF started as Mkt Perform at Wachovia.
CCI raised to Outperform at RBC.
CCRT started as Outperform at KBW.
CFC started as Sell at Goldman Sachs.
CFR raised to Outperform at Piper Jaffray.
CNQR started as Buy at Deutsche Bank.
COLM raised to Buy at B of A.
CPWM cut to Underperform at Raymond James.
DVAX raised to Outperform at Bear Stearns.
FNM & FRE started as Neutral at Goldman Sachs.
FORM started as Buy at Merrill Lynch.
FUL raised to Overweight at JPMorgan.
GOOG reitr Buy/$600 tgt at Citigroup.
INFY started as Outperform at Wachovia.
INTU cut to Mkt Perform at William Blair, cut to Accumulate at ThinkEquity.
INWK cut to Equal Weight at Morgan Stanley.
ITG raised to Overweight at JPMorgan.
LPNT started as Hold at Citigroup.
MEL raised to Overweight at Prudential.
MDTH started as Buy at Deutsche Bank, started as Outperform at Wachovia.
MNST cut to Hold at Citigroup.
MRVL cut to Underweight at Prudential.
NCC cut to Underweight at Prudential.
NGG cut to Sell at Citigroup.
NIHD started as Buy at Citigroup.
REP cut to Reduce at UBS.
SHMR cut to Sector Perform at CIBC.
SYNT started as Outperform at Wachovia.
THC started as Sell at Citigroup.
TIN cut to Hold at Deutsche Bank.
TLEO started as Buy at Deutsche Bank.
UHS started as Buy at Citigroup.
UNS started as Overweight at JPMorgan.
WIT started as Mkt Perform at Wachovia.
WSM cut to Hold at BB&T.
WY cut to Hold at Deutsche Bank.
WYNN cut to Hold at Citigroup.
XLNX cut to Peer Perform at Bear Stearns.
XOM cut to Mkt Perform at Bernstein.
YHOO raised to Buy at Oppenheimer.
VoIP Comes Of Age (VG)(CMCSA)(TMS)(TWX)(EBAY)
The ViOP bandwagon is getting fairly full. After early service like Ebay's Skype and Vonage signed on millions of customers, the cable companies (especially Comcast and Time Warner) found the ViOP was a good way to steal customers from their telecom competitors. It has worked so well that 5.1 million of the US VoIP subscribers as measured at the end of September took their service from cable providers. The total number of US customers rose to 8.2 million, up from 3.5 million a year ago.
One of the complaints about VoIP, especially early versions, is the customers needed a PC or special adapters to make the service work. The experience was different from simply picking up a telephone and dialing. Other knocks against VoIP is the it had no 911 service. That is changing. Of course, if electricity is off, VoIP doesn't work either. They are still working on that one.
Thomson, the big French electronics firm, is beginning to offer a new VoIP handset, made by GE. (One has to wonder why GE does not market the product on its own.)
Thomson's product will be sold to subsribers of SunRocket, a US VoIP service with 170,000 subscribers. The new device can simply plug into a high-speed internet line and it works as a normal phone would. If you have SunRocket service. Companies like Uniden already have similar products.
Why Thomson would market a phone exclusively with one of the smaller VoIP companies is puzzling. The firm is locking itself out of over 95% of the US market.
Thomson may be dumb, but VoIP is gaining ground like a house on fire, and that will continue.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
One of the complaints about VoIP, especially early versions, is the customers needed a PC or special adapters to make the service work. The experience was different from simply picking up a telephone and dialing. Other knocks against VoIP is the it had no 911 service. That is changing. Of course, if electricity is off, VoIP doesn't work either. They are still working on that one.
Thomson, the big French electronics firm, is beginning to offer a new VoIP handset, made by GE. (One has to wonder why GE does not market the product on its own.)
Thomson's product will be sold to subsribers of SunRocket, a US VoIP service with 170,000 subscribers. The new device can simply plug into a high-speed internet line and it works as a normal phone would. If you have SunRocket service. Companies like Uniden already have similar products.
Why Thomson would market a phone exclusively with one of the smaller VoIP companies is puzzling. The firm is locking itself out of over 95% of the US market.
Thomson may be dumb, but VoIP is gaining ground like a house on fire, and that will continue.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
VoIP Comes Of Age (VG)(CMCSA)(TMS)(TWX)(EBAY)
The ViOP bandwagon is getting fairly full. After early service like Ebay's Skype and Vonage signed on millions of customers, the cable companies (especially Comcast and Time Warner) found the ViOP was a good way to steal customers from their telecom competitors. It has worked so well that 5.1 million of the US VoIP subscribers as measured at the end of September took their service from cable providers. The total number of US customers rose to 8.2 million, up from 3.5 million a year ago.
One of the complaints about VoIP, especially early versions, is the customers needed a PC or special adapters to make the service work. The experience was different from simply picking up a telephone and dialing. Other knocks against VoIP is the it had no 911 service. That is changing. Of course, if electricity is off, VoIP doesn't work either. They are still working on that one.
Thomson, the big French electronics firm, is beginning to offer a new VoIP handset, made by GE. (One has to wonder why GE does not market the product on its own.)
Thomson's product will be sold to subsribers of SunRocket, a US VoIP service with 170,000 subscribers. The new device can simply plug into a high-speed internet line and it works as a normal phone would. If you have SunRocket service. Companies like Uniden already have similar products.
Why Thomson would market a phone exclusively with one of the smaller VoIP companies is puzzling. The firm is locking itself out of over 95% of the US market.
Thomson may be dumb, but VoIP is gaining ground like a house on fire, and that will continue.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
One of the complaints about VoIP, especially early versions, is the customers needed a PC or special adapters to make the service work. The experience was different from simply picking up a telephone and dialing. Other knocks against VoIP is the it had no 911 service. That is changing. Of course, if electricity is off, VoIP doesn't work either. They are still working on that one.
Thomson, the big French electronics firm, is beginning to offer a new VoIP handset, made by GE. (One has to wonder why GE does not market the product on its own.)
Thomson's product will be sold to subsribers of SunRocket, a US VoIP service with 170,000 subscribers. The new device can simply plug into a high-speed internet line and it works as a normal phone would. If you have SunRocket service. Companies like Uniden already have similar products.
Why Thomson would market a phone exclusively with one of the smaller VoIP companies is puzzling. The firm is locking itself out of over 95% of the US market.
Thomson may be dumb, but VoIP is gaining ground like a house on fire, and that will continue.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Ghosn And Nissan Get Blackballed (DCX)(F)(GM)
Carlos Ghosn, the sell-proclaimed greatest car executive in history, is finding that linking up with a US partner for his Nissan/Renault combine has proved more difficult than he thought. Of course, Nissan is not in first place in Japan and Renault is not a major player in Europe, so perhaps Detroit is wary.
Ghosn now says that he is "not ready" to find a partner in the US. What he is not mentioning is that no one is taking. GM has turned him down. Ford seems prepared to go it alone, even if that plan leads to its demise. DaimlerChrysler does not need him. With large operations in the US and Europe, DCX is an unlikely partner.
Perhaps if Ghosn would stop watching the pot, it would eventually boil. He may have retired before that day comes.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Ghosn now says that he is "not ready" to find a partner in the US. What he is not mentioning is that no one is taking. GM has turned him down. Ford seems prepared to go it alone, even if that plan leads to its demise. DaimlerChrysler does not need him. With large operations in the US and Europe, DCX is an unlikely partner.
Perhaps if Ghosn would stop watching the pot, it would eventually boil. He may have retired before that day comes.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
While Ford's Sales Double In China, Will It Be Around To Enjoy It
Stocks: (F)(GM)(TM)(HMC)
Ford is boasting that it will double sales in China, over and over again. But, the No. 2 car company in the US only sells about 100,000 cars in the big Asian nation. Rival GM will sell over 850,000 cars there this year.
Ford is still being bloodied in it home market, so the talk of China gains is whistling past the graveyard. Over the last decade, Ford's US share has dropped from 25.8% to 18.3%. During the same timeframe, Toyota's market share has rise from 13.3% from 7.4%. Honda's has risen from 5.4% to 8.6%.
Ford has actually predicted its US share will drop as low as 14%. Its $5 billion in annual cost cuts may bring North American operations to the point where they are cashflow positive, but that is a long way off. And, there is no guarantee that the company's forecast of a 14% bottom is accurate. Ford could hardly have predicted its current sales when it had almost 26% of its home market.
Ford management needs to shut-up about China. The company not be around to enjoy it progress there.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Ford is boasting that it will double sales in China, over and over again. But, the No. 2 car company in the US only sells about 100,000 cars in the big Asian nation. Rival GM will sell over 850,000 cars there this year.
Ford is still being bloodied in it home market, so the talk of China gains is whistling past the graveyard. Over the last decade, Ford's US share has dropped from 25.8% to 18.3%. During the same timeframe, Toyota's market share has rise from 13.3% from 7.4%. Honda's has risen from 5.4% to 8.6%.
Ford has actually predicted its US share will drop as low as 14%. Its $5 billion in annual cost cuts may bring North American operations to the point where they are cashflow positive, but that is a long way off. And, there is no guarantee that the company's forecast of a 14% bottom is accurate. Ford could hardly have predicted its current sales when it had almost 26% of its home market.
Ford management needs to shut-up about China. The company not be around to enjoy it progress there.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Investors Get Ticked At Starbucks (SBUX)(MCD)
Wall St. took shares in Starbucks down by over 5% after hours as the company announced a 21% improvement in quarterly revenue to $2 billion. The company forecast that it would open 2,400 stores in the next twelve months. It also said that investors could expect another 20% increase in revenue.
Profits dropped 5.6% to $117 million, but this was due to changes in the company's accounting policies.
The key to the numbers was simple. Starbucks is still growin 20%. It grew 20% in fiscal 2005. It grew 21% in the recent quarter. It forecast 20% growth for next year. Off of an annual revenue run rate of $8 billion, the figure is extraordinary.
Starbucks has the stated and ambitious goal of eventually having 40,000 stores worldwide. At the end of this fiscal year, the figure was about 14,000, and, if the company's projections are right, that will be nearing 17,000 twelve months from now. Starbucks still has a reasonable chance of hitting its number within the next ten years.
McDonald's has over 30,000 stores, so why shouldn't Starbucks.
Why not, indeed.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Profits dropped 5.6% to $117 million, but this was due to changes in the company's accounting policies.
The key to the numbers was simple. Starbucks is still growin 20%. It grew 20% in fiscal 2005. It grew 21% in the recent quarter. It forecast 20% growth for next year. Off of an annual revenue run rate of $8 billion, the figure is extraordinary.
Starbucks has the stated and ambitious goal of eventually having 40,000 stores worldwide. At the end of this fiscal year, the figure was about 14,000, and, if the company's projections are right, that will be nearing 17,000 twelve months from now. Starbucks still has a reasonable chance of hitting its number within the next ten years.
McDonald's has over 30,000 stores, so why shouldn't Starbucks.
Why not, indeed.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Hewlett-Packard (HPQ) Earnings: Red Flag On Slowing Tech
The market was not unhappy about HP's earnings, but the applause was muted.
HP's revenue rose 7% in its fiscal Q4 to $24.6 billion. The company forecast that annual sales for its 2007 fiscal year would rise about the same amount to $97 billion.
HP's stock fell about 2% after hours to $39.60. The shares have been trading near their 62-week high.
Revenue at HP's big personal systems group, which sells PCs, rose 10% to $7.8 billion, and revenue was up 7% at HP's imaging and printing group, hitting $7.3 billion. But, therein lies the problem. These two units are almost $15 billion of the quarter's $24 billion plus in revenue. And, the growth at the operations are unimpressive.
In fiscal 2004, HP grew 9%. In fiscal 2005, revenue was up 9% again. Even with the share that the company is taking from Dell in the large PC market, HP's rapid growth is behind it, at least for now.
At $40, the stock is now rich. Morningstar carries a "fair market" value of $30 on the stock and suggests that investors consider selling when the stock is above $37.60. For a company that has lost much of its top-line growth potential, that is not unfair.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
HP's revenue rose 7% in its fiscal Q4 to $24.6 billion. The company forecast that annual sales for its 2007 fiscal year would rise about the same amount to $97 billion.
HP's stock fell about 2% after hours to $39.60. The shares have been trading near their 62-week high.
Revenue at HP's big personal systems group, which sells PCs, rose 10% to $7.8 billion, and revenue was up 7% at HP's imaging and printing group, hitting $7.3 billion. But, therein lies the problem. These two units are almost $15 billion of the quarter's $24 billion plus in revenue. And, the growth at the operations are unimpressive.
In fiscal 2004, HP grew 9%. In fiscal 2005, revenue was up 9% again. Even with the share that the company is taking from Dell in the large PC market, HP's rapid growth is behind it, at least for now.
At $40, the stock is now rich. Morningstar carries a "fair market" value of $30 on the stock and suggests that investors consider selling when the stock is above $37.60. For a company that has lost much of its top-line growth potential, that is not unfair.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Hewlett-Packard (HPQ) Earnings: Red Flag On Slowing Tech
The market was not unhappy about HP's earnings, but the applause was muted.
HP's revenue rose 7% in its fiscal Q4 to $24.6 billion. The company forecast that annual sales for its 2007 fiscal year would rise about the same amount to $97 billion.
HP's stock fell about 2% after hours to $39.60. The shares have been trading near their 62-week high.
Revenue at HP's big personal systems group, which sells PCs, rose 10% to $7.8 billion, and revenue was up 7% at HP's imaging and printing group, hitting $7.3 billion. But, therein lies the problem. These two units are almost $15 billion of the quarter's $24 billion plus in revenue. And, the growth at the operations are unimpressive.
In fiscal 2004, HP grew 9%. In fiscal 2005, revenue was up 9% again. Even with the share that the company is taking from Dell in the large PC market, HP's rapid growth is behind it, at least for now.
At $40, the stock is now rich. Morningstar carries a "fair market" value of $30 on the stock and suggests that investors consider selling when the stock is above $37.60. For a company that has lost much of its top-line growth potential, that is not unfair.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
HP's revenue rose 7% in its fiscal Q4 to $24.6 billion. The company forecast that annual sales for its 2007 fiscal year would rise about the same amount to $97 billion.
HP's stock fell about 2% after hours to $39.60. The shares have been trading near their 62-week high.
Revenue at HP's big personal systems group, which sells PCs, rose 10% to $7.8 billion, and revenue was up 7% at HP's imaging and printing group, hitting $7.3 billion. But, therein lies the problem. These two units are almost $15 billion of the quarter's $24 billion plus in revenue. And, the growth at the operations are unimpressive.
In fiscal 2004, HP grew 9%. In fiscal 2005, revenue was up 9% again. Even with the share that the company is taking from Dell in the large PC market, HP's rapid growth is behind it, at least for now.
At $40, the stock is now rich. Morningstar carries a "fair market" value of $30 on the stock and suggests that investors consider selling when the stock is above $37.60. For a company that has lost much of its top-line growth potential, that is not unfair.
Douglas A. McIntyre can be reached at douglasamcintyre@247wallst.com. He does not own securities in companies that he writes about.
Media Digest 11/17/2006 Reuters, Wall Street Journal, New York Times
Stocks: (QCOM)(DCX)(HPQ)(SBX)(SHLD)
According to Reuters, Delta is seeking the help of its creditors to fight off a bid by Delta Airlines to acquire the bankrupt carrier.
Reuters writes that the CEO of Qualcomm stated that investors in the company support its intellectual property legal fight although it has depressed the price of the company's stock.
Reuters, writes that DaimlerChrysler is still in talks with Chinese car manufacturer Cherry about building a subcompact car.
Reuters writes that HP profits went up four-fold due to year ago charges. Revenues rose 7% and beat estimates.
The Wall Street Journal reports that Sear Holding's profits tripled due to investments. Sales at its Sears and K Mart units were weak.
The Wall Street Journal also writes that a study by Harvard and Cornell indicates that 850 CEOs of public companies received incorrectly dated options which increased their pay an average of over 10%.
The New York Times reports that oil hit its lowest price in a year as the markets doubted the impact of OPEC production cuts.
The New York Times also writes that the profit as Starbuck's fell 5% due to new accounting methods. Revenue rose 20% to $2 billion.
Douglas A. McIntyre
According to Reuters, Delta is seeking the help of its creditors to fight off a bid by Delta Airlines to acquire the bankrupt carrier.
Reuters writes that the CEO of Qualcomm stated that investors in the company support its intellectual property legal fight although it has depressed the price of the company's stock.
Reuters, writes that DaimlerChrysler is still in talks with Chinese car manufacturer Cherry about building a subcompact car.
Reuters writes that HP profits went up four-fold due to year ago charges. Revenues rose 7% and beat estimates.
The Wall Street Journal reports that Sear Holding's profits tripled due to investments. Sales at its Sears and K Mart units were weak.
The Wall Street Journal also writes that a study by Harvard and Cornell indicates that 850 CEOs of public companies received incorrectly dated options which increased their pay an average of over 10%.
The New York Times reports that oil hit its lowest price in a year as the markets doubted the impact of OPEC production cuts.
The New York Times also writes that the profit as Starbuck's fell 5% due to new accounting methods. Revenue rose 20% to $2 billion.
Douglas A. McIntyre
Asia Markets 11/17/2006 PCCW, Fuji Film Up, Softbank, Yahoo Japan Down
Stocks: (CAJ)(FUJ)(NIPNY)(HMC)(NTT)(TM)(CHL)(CH)(PCW)(HNC)
Markets in Asia were narrowly mixed.
The Nikkei was down .5% to 16,092. Bridgestone was up 1.4% to 2515. Canon was up 1% to 6310. Daiwa Securities was down 1.4% to 1263. Fuji Film was up 2.7% to 4590. Hitachi was up .6% to 707. Honda was up .2% to 4210. Japan Air was off 1.4% to 217. NEC was up 1% to 604. NTT was up 1.2% to 573000. Sharp was down .5% to 2030. Softbank was down 2.6% to 2245. Sony was up 1.3% to 4770. Toshiba was down .3% to 731. Toyota was up .3% to 7260. Yahoo Japan was down 3.6% to 40200.
The Hang Seng was up .2% to 19,183. Cathay Pacific was up 1.7% to 18.98. China Mobile was down 1.1% to 68.65. China Unicom was down 1% to 8.24. HSBC was up .4% to 147.2. PCCW was up 1.9% to 5.23.
The KOSPI was up .1% to 1,412.
The Straits Times was up .5% to 2,813.
The Shanghai Composite was up 1.6% to 1,972.
Data from Reuters.
Douglas A. McIntyre
Markets in Asia were narrowly mixed.
The Nikkei was down .5% to 16,092. Bridgestone was up 1.4% to 2515. Canon was up 1% to 6310. Daiwa Securities was down 1.4% to 1263. Fuji Film was up 2.7% to 4590. Hitachi was up .6% to 707. Honda was up .2% to 4210. Japan Air was off 1.4% to 217. NEC was up 1% to 604. NTT was up 1.2% to 573000. Sharp was down .5% to 2030. Softbank was down 2.6% to 2245. Sony was up 1.3% to 4770. Toshiba was down .3% to 731. Toyota was up .3% to 7260. Yahoo Japan was down 3.6% to 40200.
The Hang Seng was up .2% to 19,183. Cathay Pacific was up 1.7% to 18.98. China Mobile was down 1.1% to 68.65. China Unicom was down 1% to 8.24. HSBC was up .4% to 147.2. PCCW was up 1.9% to 5.23.
The KOSPI was up .1% to 1,412.
The Straits Times was up .5% to 2,813.
The Shanghai Composite was up 1.6% to 1,972.
Data from Reuters.
Douglas A. McIntyre
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