Tuesday, June 12, 2007Retail Ventures (RVI) Plummets (Related) Posted 12:49 PM
Retail Ventures
(RVI (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
has slipped 9% after the company reported first-quarter earnings of 6 cents per share. Excluding items, the company was 21 cents per share lighter in the pocket. A year earlier, the company broke even. Revenue for the period came in 4.5% higher at $754.1 million from $721.5 million a year earlier. Same-store sales for the period shed 5.2%.
The worst part of this report is the reaction. The 9% drop sent the stock through potential support at the 17.50 level. The last time the stock finished a day below this level was at the end of November. There is good news, however, when pulling back to a long-term look for RVI. The stock has settled on its 20-month moving average, a trendline that the shares have never finished a month below. Let's see if this trendline can provide a springboard for the struggling stock.
-Posted by Mark Fightmaster (mfightmaster@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Repligen (RGEN) Versus ImClone (IMCL) (Related) Posted 12:19 PM
This morning, Repligen Corp.
(RGEN (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
announced that a Massachusetts federal court has ruled in favor of a sanctions motion against ImClone Systems
(IMCL (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
. The ruling finds that IMCL's attorneys interfered with a key witness in their continuing litigation concerning the drug Erbitux. RGEN and the Massachusetts Institute of Technology (MIT) are suing IMCL for patent infringement regarding technology IMCL used in creating its cancer treatment, which is marketed with Bristol-Myers Squibb
(BMY (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
. RGEN stated that the court is also allowing its legal team to introduce evidence of the improper behavior of IMCL's attorneys to the jury.
RGEN has advanced more than 7% in this morning's trading action, but the stock backed off from resistance in the 4 region. IMCL has shed more than 2.5%, while BMY has slipped more than 1%.
-Posted by Mark Fightmaster (mfightmaster@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Pacific Sunwear (PSUN) Put Options Providing Shade? (Related) Posted 12:08 PM
Nestled among the indexes and exchange traded funds (ETF) on today's buy-to-open data from the International Securities Exchange (ISE) was a surprising little gem on the most active put side of the coin. It seems that during the past 10 days, the bears have been out in force in the Pacific Sunwear
(PSUN (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
options pits. For the record, some 10,998 puts were bought to open on the ISE during the prior 10-day period, compared to just 218 calls bought to open. The result is a hefty ISE 10-day put/call ratio of 50.45.
According to Schaeffer's data, PSUN's Schaeffer's put/call open interest ratio (SOIR) has crept higher during this time frame, backing up the rise in pessimism reflected in the ISE data. In fact, the stock's SOIR has risen from 0.73 on June 4 to today's perch at 0.85, in the 78th percentile.
This pessimism seems a bit lopsided, but it may be warranted. The company disappointed with its earnings release last week, and the shares have meandered sideways ever since. There is key support at the 20 level, with PSUN's 20-week moving average in residence, but given the stock's sketchy past, this support may not hold. Is this heavy put activity smart money? That still remains to be seen.
-Posted by Joseph Hargett (jhargett@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Ecolab (ECL) Rises on Upgrade From Credit Suisse (Related) Posted 11:42 AM
Sanitation and maintenance experts Ecolab (ECL) got a boost today after receiving an upgrade from Credit Suisse. The brokerage took Ecolab to "outperform" from "neutral," and also took this opportunity to up its target price to $50 from $49. Credit Suisse said that it sees Ecolab having "no trouble hitting its 15% EPS target for 2007."
Following this news, shares of Ecolab have added 2.5%. This move brings the stock above its 10-day moving average, which has served as a line of resistance for the past 12 sessions.
We are finding growing optimism towards Ecolab just about everywhere except down in the options pits, where we find the stock's Schaeffer's put/call open interest ratio is at 0.50, a reading that is higher than 93% of all other readings taken over the past year.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Source Interlink (SORC) Rises on Earnings Disappointment (Related) Posted 10:34 AM
Profits and revenue rose in the fiscal first quarter for Source Interlink
(SORC (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
, but still fell short of analysts' predictions. Net income for the period climbed 10% higher to $3.2 million, or 6 cents per share, compared to $2.9 million, or 5 cents per share, in the year-ago period. Excluding amortization of acquired intangibles, income rose 6% to $5.2 million, or 10 cents per share, from last year's $4.9 million (9 cents per share).
Revenue for the period increased to $475.5 million, a 6% rise from $447.9 million last year.
Analysts, on average, were looking for Source Interlink to report earnings of 13 cents per share on $514.5 million in revenue. The company fell well short of those predictions, yet SORC shares have risen in this morning's trading.
With the stock feeling overhead pressure from just about every different combination of moving averages available, this morning's gain seems a bit strange. However, the wealth of investor bearishness on SORC heading into the report means that investor expectations may have been a bit lower than the Street's, turning this quarter's modest increases in income and revenue into a positive earnings surprise. Currently, more than 28% of the stock's float has been shorted, pushing the stock's short-interest ratio to 14.56.
As investors have had more of a chance to digest this earnings news, the stock is already trimming its gains. After a rise of more than 2% early this morning, SORC is resting on a 0.7% climb at last check.
-Posted by Elizabeth Harrow (eharrow@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Take-Two (TTWO) Takes Advantage of a Morning Upgrade (Related) Posted 10:28 AM
J.P. Morgan felt confident enough to upgrade Take-Two Interactive
(TTWO (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
this morning to "overweight" from "neutral." The brokerage said that it likes Take-Two's potential for upward sales movement ahead of the release of the video game Grand Theft Auto IV . According to J.P. Morgan, the company could see gains coming from its attractive valuation, strong revenue, and earnings-per-share growth. It also sees the company having a good chance to beat the consensus estimates for full-year 2008.
We find that sentiment on TTWO is generally pessimistic at the moment, but there could be signs that the tide is turning. Prior to this morning's upgrade, all 14 of the analysts following Take-Two rated it a "hold" or worse, with 4 of those issuing "strong sell" ratings. Down in the options pits, the stock's Schaeffer's put/call open interest ratio is currently 1.69, indicating that there are more than 1.5 bearish put contracts opened for every bullish call contract. This seemingly high ratio is, however, relatively low. In fact, it is lower than 71% of readings taken over the past year.
In this morning's trading, TTWO has gained 4.7%, up to $19.80. This movement brings the stock above both it 10-day and 20-day moving averages. The ascent, however, was stopped at the 20 level, which could prove to be a level of round-number resistance.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
GlaxoSmithKline (GSK) and Pfizer (PFE) Weigh in with New Obesity Drugs (Related) Posted 10:07 AM
Two new obesity drugs will arrive on U.S. pharmacy shelves this week, as GlaxoSmithKline
(GSK (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
introduces its new product, alli, and Pfizer
(PFE (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
begins shipping its weight-loss drug for dogs, Slentrol.
GSK's alli is reported to help dieters lose 50% more weight than dieting alone (with the usual, unhappy caveat that you have to take the pill in conjunction with a diet and exercise plan). The over-the-counter product will be available through pharmacies, grocery stores and other retailers later this week, according to company reports.
Switching our focus to fat dogs a topic I have yet to address in this space, oddly enough Pfizer has begun shipping Slentrol, a prescription aimed at the 40% of American dogs that are overweight. The drug works as an appetite suppressant, relying on a chemical mechanism that is canine-specific. Pfizer emphasizes the drug is not for human or feline use.
Shares of both GSK and PFE are down fractionally in this morning's trading. Both equities are dropping under pressure from their respective 10-day and 20-day moving averages.
-Posted by Elizabeth Harrow (eharrow@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Cyberonics (CYBX) Plunges on Earnings Report (Related) Posted 9:37 AM
Cyberonics
(CYBX (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
announced that its fiscal fourth-quarter loss widened to $10.8 million, or 42 cents a share, compared to its year-ago loss of $4.27 million, or 17 cents per share. Sales for the 3-month period dropped 13% to $31.4 million. Analysts had predicted a loss of 35 cents per share on revenue of $33 million. The company has struggled in its effort to win reimbursement coverage for a depression treatment. CYBX makes a pacemaker-like device that hooks up to a major nerve to treat 2 conditions, epilepsy and depression, that don't respond well to drugs. The newer depression market has not taken off amid the reimbursement troubles. In particular, the Centers for Medicare and Medicaid Services recently declined to cover the treatment.
The shares have gapped lower this morning, dropping nearly 10% and below key support at the 17.50 level. The equity is now at its lowest point since early September. The security has been in a long-term downtrend since hitting a peak in June 2005 at $47.77. Since that high, CYBX has shed nearly 66%.
Options players remain relatively optimistic. Schaeffer's put/call open interest ratio for CYBX comes in at 0.61, which is lower than nearly three-quarters of all the readings taken during the past 52 weeks.
-Posted by Jocelynn Drake (jdrake@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Dean Foods (DF) Lowers Quarterly and Full-Year Outlook (Related) Posted 9:28 AM
Dean Foods
(DF (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
cut its second-quarter and full-year 2007 earnings estimates this morning. The company expects to earn 30 cents to 31 cents a share in the second quarter and $1.52 to $1.58 for the year. In May, Dean said it expected to bring in 37 to 38 cents in the second quarter, though this estimate was allowing for "a fair amount of uncertainty." At the same time, the company said it was expecting to be closer to the low end of its $1.72 to $1.78 estimated range. Currently, analysts are looking for Dean to bring in earnings of 37 cents in the quarter and $1.69 for the year.
The dairy-centric company said the problem stems from record-breaking prices for raw milk being expected in the coming months, as well as a current industry-wide oversupply of organic milk which is taking a toll on Dean's Horizon Organic brand. The company said that the third-quarter looks to be "particularly challenging."
The stock has been trading in the $31-$33 range for 3 weeks now, after gapping lower in late April. Looking at the sentiment on Dean, with 4 analysts rating the company a "strong buy," there is plenty of room for downgrades on the lowered expectations. On the other hand, should the company come away from this news relatively unscathed, the 7 analysts handing "hold" ratings or worse could rethink the company's resilience and issue upgrades.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Monday, June 11, 2007Sales News From Xilinx (XLNX) (Related) Posted 3:56 PM
Xilinx
(XLNX (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
said that it currently expects first-quarter revenue to hit the low end of its previously targeted range of 1% to 5% growth sequentially. The chip-making concern also expects gross margin of 62% to 63%, up from its earlier estimate of 62%. Operating expenses are projected to slip 5% sequentially, better than prior predictions of a 4% to 5% decrease.
This news initially hit the wires late last week but is getting additional mention today, as investors digest the reports. The stock is off 0.70% in late-afternoon trading and is holding support at its 80-day moving average.
The company's last earnings report was on April 25, so its next trek into the earnings confessional should occur in late July.
-Posted by Beth Gaston Moon (bgmoon@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
H&R Block (HRB) Benefits From Upgrade (Related) Posted 3:27 PM
As the closing bell draws near, H&R Block
(HRB (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
continues to sit with solid gains, up nearly 5% on the heels of a brokerage upgrade. This morning, UBS lifted its rating on the stock to "buy" from "neutral," citing takeover rumors. The brokerage also raised its 12-month price target to $28 from $24.
An intraday chart reveals that HRB has been unable to reach past the 23.70 level in today's trading, and has actually spent most of today's session in a tight trading range after an early spike into positive territory. One trendline hovering immediately overhead is the 160-week moving average, which thwarted a rally attempt in the stock 2 weeks ago and seems to be providing a ceiling again today.
On the options front, out-of-the-money call open interest is heavy at the 25 strike. The wall of calls open in the June and July series could be fortifying resistance in this area.
-Posted by Beth Gaston Moon (bgmoon@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Google (GOOG) Renews Antitrust Concerns on Microsoft (MSFT) (Related) Posted 12:56 PM
It's tit-for-tat again between Google
(GOOG (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
and Microsoft
(MSFT (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
. Over the weekend, the New York Timesreported (Related) that a top antitrust official at the Justice Department was helping MSFT (Related) . Furthermore, Google has also alleged that Microsoft is limiting consumer choice with its Vista desktop search functions.
While this news doesn't seem to have had any impact on the shares in today's trading, with both MSFT and GOOG relatively flat on the session, Douglas McIntyre over at BloggingStocks.com believes that all this hubbub works in Google's favor (Related) . According to McIntyre: "Google is shrewd. Anything that ties up Microsoft in its flagship OS business takes resources away from the company's other ventures, such as the search market.... And Google does not even have to pay the legal fees."
There is no doubt that investors and analysts absolutely love these 2 stocks, with only 6 "holds" and no "sell" ratings out of the 40 brokerage firms offering up opinions on MSFT and GOOG. However, while I agree with Mr. McIntyre that this situation does seem to ultimately benefit Google, I wonder just how long this type of school ground one-upmanship will be tolerated on Wall Street before investors finally get tired of the tabloid-style headlines swarming around the 2 companies.
-Posted by Joseph Hargett (jhargett@sir-inc.com)
Discuss this commentary (Comments: 1) (Related)
AirTran (AAI) & UAL Corp. (UAUA) Downgrades Pressure Airline Stocks (Related) Posted 12:37 PM
Airline stocks are taking a beating today, as rising crude prices and static load factors remain key investor concerns. Creating additional turbulence this morning, Calyon Securities cut AirTran Holdings
(AAI (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
to "neutral" from "add" and downgraded UAL Corp.
(UAUA (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
to "add" from "buy." At last check, the AMEX Airline Index (XAL - 49.61) was down about 1.6%, while AAI and UAUA were both lower by more than 2.5%.
Sentiment in the airline sector indicates that more such downgrades could be just over the horizon. According to Zacks (Related) Zacks data, 52% of all analysts following airline stocks rate them a "buy" or better. With crude continuing to rise, the July contract was last seen up 17 cents at $64.93 per barrel, and demand for tickets stagnating, such downgrades could be a very real possibility.
-Posted by Joseph Hargett (jhargett@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Qwest's (Q) CEO Announces Retirement (Related) Posted 12:24 PM
In this morning's trading, Qwest Communications International
(Q (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
is more than 5% lower, so I figured it was time to go on my own quest . . . to find out what caused the drop. Fortunately, no Black Knights or killer rabbits stood in my path, as the story was nearly front and center on various news outlets. The company's CEO, Richard Notebaert announced that he plans to retire as soon as a successor is found. The 59-year-old CEO (who took the helm in June 2002) helped Q fight through a reorganization and a near bankruptcy in his tenure, with the stock eventually pushing more than 250% higher. In late 2006, Q decided to reward its long-suffering investors by beginning a stock-repurchase program.
Today's drop seems to have found a floor at the 9.50 level. If this support gives way, we could see the equity's 10-month moving average step in to provide support, as it has since July 2005. Since moving back above this monthly trendline, the equity has not finished a month below it. Further support is found in the form of Q's 10-week moving average. Since early February, this trendline has provided faultless support. Keep an eye on the stock's situation, today's action could just be a temporary pullback . . .
-Posted by Mark Fightmaster (mfightmaster@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
CBOT Holdings (BOT) Downgraded (Related) Posted 12:23 PM
The shares of CBOT Holdings
(BOT (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
were hit with a downgrade this morning from Credit Suisse, who lowered the security from "outperform" to "neutral." The brokerage firm cited the belief that the merger with the Chicago Mercantile Holdings
(CME (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
will be consummated soon and that it sees CME shares as the better entry point to a combined firm. According to the brokerage firm, CBOT trades at a 3% premium to the current CME bid.
Investors have largely shrugged off the comments from the brokerage firm this afternoon as the stock is up 0.52% at the moment. The equity is currently trending sideways along support at its 10-day and 20-day moving averages.
For more information on BOT's merger plans, please read InterContinental Exchange Makes Bid for CBOT (Related) and Behind the Headlines: Chicago Mercantile Exchange Holdings (CME) Rises on Merger Hopes (Related) .
-Posted by Jocelynn Drake (jdrake@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Apple (AAPL) in Talks to Get Hollywood on iTunes (Related) Posted 11:47 AM
According to 2 unnamed sources being cited in the online edition of The Wall Street Journal , Apple
(AAPL (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
is aggressively pitching a plan to offer full-length feature film rentals on its iTunes service to Hollywood studios. While no studios have definitively accepted or declined the idea, Viacom's
(VIA (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
Paramount Pictures is reportedly in favor of a deal, while General Electric's
(GE (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
Universal Studios is not on board. Currently, iTunes offers downloads of TV programs and some older movies, but studios have not yet wanted to use the service as a means of distributing their newer release films. The plan, according to the article in the Journal , would be to rent movies for $2.99, giving the customer a set number of days in which to view it.
So far in today's trading, the announcement has had little impact on Apple stock, as shares are just 5 cents down from Friday's closing price. Of course, with or without a Hollywood deal, Apple is climbing on the charts ahead of the release of the hotly anticipated iPhone. Analysts are certainly not ignoring the impact this could have on the stock; currently 14 of the 18 firms following AAPL rate it a "buy" or better. The remaining 4 analysts do not take the stock below a "hold." From a contrarian perspective, this raises eyebrows, as it leave much room for downgrades with little room for further upgrades. However, this being Apple just a few weeks before a major release, I wouldn't lay bets on any downgrade action in the coming month or so.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Nucor (NUE) Cuts Earnings Outlook (Related) Posted 10:53 AM
This morning, Nucor
(NUE (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
announced that it expects second-quarter earnings to come in at $1.05 to $1.15 per share. This estimate is well below the consensus estimate on the Street for a profit of $1.42 per share. The firm stated that results are being affected by lower shipments from its Bar Mill Group. The company sees improved Bar shipments in the second half of the year.
The stock has dropped more than 5% this morning, falling below its 10-day and 20-day moving averages. Furthermore, the equity has slipped below support at its 20-week trendline, which it has finished only 1 week below since the beginning of October. On the other hand, the shares appear to be bouncing off support at the 62 level this morning.
From a sentiment perspective, options players are extremely optimistic toward the shares. Schaeffer's put/call open interest ratio for NUE rests at 0.76, which is lower than 81% of the readings taken during the past year. In other words, short-term options speculators have been more bullishly aligned toward the shares only 19% of the time during the past 12 months. Should these bulls begin to unload their long positions, the stock could suffer from additional losses.
-Posted by Jocelynn Drake (jdrake@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Legal Woes Pressure QUALCOMM (QCOM) Lower (Related) Posted 10:47 AM
Shares of QUALCOMM
(QCOM (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
have been down in the dumps lately, slipping more than 13% since May 22. Today is proving to be no better for the equity, as a renewed legal push from rival Nokia
(NOK (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
is having an adverse effect on the shares. Nokia is seeking to halt QCOM's use of certain patents that NOK claims it owns. Amid this decline in QCOM shares, analysts have yet to accept the downtrend in the security. According to Zacks (Related) Zacks , 18 of the 22 brokerage firm's offering up an opinion rate QCOM a "buy" or better. Should this legal action by NOK not end in the company's favor, the shares could take another swan dive, potentially breaching key support at the round number 40 level.
-Posted by Joseph Hargett (jhargett@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Microsoft (MSFT) Finds Ally in Bush Administration (Related) Posted 10:09 AM
This morning brings us news that Google
(GOOG (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
has sent a 50-page document to state and federal antitrust regulators, alleging that Microsoft's
(MSFT (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
Vista operating system violates the terms of Microsoft's prior antitrust settlement. Google charges that Vista's desktop-search functionality makes it more difficult for users to run comparable software made by Google and other Microsoft competitors if they so choose.
What's different about this debate between the competitors is the government's response. A memo from the Justice Department last month encouraged state prosecutors to dismiss Google's antitrust claim, indicating the Bush administration's somewhat laissez-faire stance on antitrust regulations.
News reports have also been circulating this morning that the Redmond, Washington-based Microsoft has been in talks with General Electric
(GE (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
component NBC Universal to discuss a possible bid on Dow Jones & Co.
(DJ (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) ) .
Investors are following the Bush administration's lead with their pro-Microsoft stance. The equity's Schaeffer's put/call open interest ratio (SOIR) is 0.37, which is lower than 70% of the other SOIR readings on Microsoft in the past 12 months.
Technically, MSFT is struggling under a bearish cross of its 10-day and 20-day moving averages. In today's trading, MSFT is up 0.5%.
-Posted by Elizabeth Harrow (eharrow@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Walt Disney (DIS) Goes Bollywood (Related) Posted 9:49 AM
The Wall Street Journal reported this morning that Walt Disney
(DIS (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
has entered a partnership with Yash Raj Films of India. Under the terms of the deal, Yash Raj will produce Disney's films as voiced by Indian stars, replacing the stateside celebrities who usually lend vocal talent to Disney's movies. The move is part of Disney's strategy to reduce its independence abroad and instead partner with local businesses in its overseas ventures, as the company attempts to double its profits attributable to foreign operations.
Shares of Disney have stagnated lately, stuck in a sideways channel. However, the equity is still resting atop support from its 10-month moving average, which recently completed a bullish cross with the stock's 20-month moving average. DIS has made a fractional gain in today's early-morning trading.
-Posted by Elizabeth Harrow (eharrow@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Johnson & Johnson (JNJ) Gets Upgraded at Credit Suisse (Related) Posted 9:18 AM
Johnson & Johnson
(JNJ (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
is starting out the week on the right foot, as the company has received an upgrade from Credit Suisse. The brokerage took JNJ up to "neutral" from "underperform," noting that shares of JNJ have underperformed rival pharmaceuticals by 17% and the S&P 500 by 16% over the last 12 months. Credit Suisse added, however, of the 2008 forecast, "Although consensus EPS remains too high ($4.29) vs. our $4.02 forecast (up from $4.00), we think market expectations are now just slightly above ours (approximately $4.09/share)."
After a decline between late February and late March which took the stock down to support at the 60 level, JNJ came back and has been, for the past 5 weeks been trading sideways between the 62 and 64 levels. Shares ended Friday near the bottom of this range, at $62.13, so they have a way to go before they can challenge the upper end of the range.
Optimism on Johnson & Johnson is strong. Prior to this morning's upgrade, 8 of the 13 analysts following the stock rated it a "buy" or better.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Friday, June 08, 2007Children's Place Retail Stores (PLCE) Reaches an Agreement with Walt Disney (DIS) (Related) Posted 3:06 PM
The Children's Place Retail Stores
(PLCE (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
announced this morning that it has agreed to settle differences with Walt Disney
(DIS (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
that it committed material breaches of a licensing agreement to run Disney stores in North America. Under the plan, PLCE will remodel 234 existing Disney stores by the end of fiscal 2011 and will open at least 18 new Disney stores using the new store prototype. Furthermore, PLCE will complete a maintenance refresh program in 165 Disney stores by no later than June 30, 2008. It's still planning on spending $175 million on the remodel and refresh programs. Disney can require Children's Place to pay an $18 million penalty if it makes three or more violations, and terminate the license agreement on five or more violations.
The shares of PLCE are up 1% this afternoon following a 0.51% loss on Thursday. The stock appears to be bouncing back off support at its 20-day moving average but must still conquer resistance at its 10-day trendline. The shares also have support in the form of their 20-week moving average, which resides at the 55 level.
Options players are extremely optimistic when it comes to the retailer. The Schaeffer's put/call open interest ratio for PLCE rests at 0.33, which is lower than 98% of the readings taken during the past 52 weeks.
-Posted by Jocelynn Drake (jdrake@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Quiksilver (ZQK) Rallies on Earnings News (Related) Posted 2:57 PM
Quiksilver
(ZQK (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
reported this morning that it suffered a fiscal second-quarter net loss of $4.8 million, or 4 cents per share, from a year-ago net profit of $3.73 million, or 3 cents per share. Revenue during the 3-month period climbed 17% to $603.8 million, from $516.9 million in the comparable period last year. Analysts had predicted a loss of 4 cents per shares on sales of $574 million. Looking ahead, the firm stated that it still expects fiscal 2007 earnings of 53 cents on revenue of $2.5 billion, but added that it now expects earnings of 3 cents a share to shift from the third to the fourth fiscal quarter.
The stock has gained 7.6% so far today, leaping back above its 10-day moving average. The shares have climbed steadily from their near-term low of 10.90 reached on March 14.
Short sellers could soon feel the pinch if the stock continues to rally. In May, the number of ZQK shares sold short increased by 15% to 22.6 million. This accumulation of bearish bets is almost 10 times the equity's average daily trading volume. An unwinding of these positions could fuel additional gains in the shares.
-Posted by Jocelynn Drake (jdrake@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Yahoo! (YHOO) CEO's Bloated Pay Raises Questions (Related) Posted 2:53 PM
Two proxy advisory and voting firms, Proxy Governance and Institutional Shareholder Services, have recommended that Yahoo!
(YHOO (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
shareholders not reelect members of the company's compensation committee at its annual meeting next week. Data compiled by the firms reveal that CEO Terry Semel received $107.5 million worth of compensation in 2006, including stock grants and bonuses. As Douglas McIntyre points out in this BloggingStocks.com entry (Related) , that's not too far off from Yahoo's first-quarter net income of $124 million.
And, in case you're not yet appalled by these figures, Semel's salary is higher than the average compensation for his peers chiefs at companies like Microsoft
(MSFT (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
and Google
(GOOG (Related) :
sentiment (Related) ,
chart (Related) ,
options (Related) )
by 926%, which is not a typo. In an attempt to placate investors, company spokeswoman Helena Maus said in an email to MarketWatch that Semel's direct compensation for the year was a mere $1, with the rest of his pay coming in the form of "performance-based stock option grants."
Since McIntyre does a fine job questioning the worth of Semel's performance, I won't retread the issue here. However, it's my job to point out that, despite a 1% rise today, YHOO shares have recently been trending lower under pressure from their 10-day and 20-day moving averages.
-Posted by Elizabeth Harrow (eharrow@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
Gold Ends the Week with a Thud (Related) Posted 2:08 PM
As the dollar showed strength against major foreign currencies, gold futures were looking less appealing to investors. Gold for August delivery closed down $14.90 at $650.30 an ounce, making this the fifth straight day the commodity fell. For the week, gold has retreated $26.60, or 3.9%.
Other metals likewise lost ground: July silver fell 44 cents, or about 3%, to close at $13.04 an ounce, while July copper fell 11.95 cents, or more than 3%, to $3.2575 a pound. July platinum dropped $8.70 to $1,286.80 an ounce, and September palladium fell $1.85 to $370.60 an ounce.
Not surprisingly, gold mining stocks have also suffered under this pullback in the price of the metal. The AMEX Gold BUGS Index (HUI) is currently down 0.5% on the day and has lost 5.5% so far for the week. The ISE Gold Index (HVY) has retreated 0.53% today and is down 5.8% for the week.
-Posted by Ian Stansel (istansel@sir-inc.com)
Discuss this commentary (Comments: 0) (Related)
No comments:
Post a Comment