Autism, Lawns, iPhone, StockGumshoe
– This is garbage. There is no proof there is a link between the two.
– I am surprised this market is not much larger
– Creating a shortage to stir sluggish demand.
– More barely legal mailings….before you act, please read this site
Not yet, but it seems like just a matter of time for the AIG (AIG) CEO..
Here is the thing. Sullivan can talk all day about “system upgrades” and M&A troubles integrating Greenberg’s mergers. He can also complain all day that many of the write-down’s currently being suffered are the results of what Greenberg did. None of it matters…
Why? Sullivan said earlier in the year that he did not expect any write-downs. He said it and he cannot put that aside. You also cannot say you have a “fortress balance sheet”, take over $11 billion in write-downs in a quarter then go out and raise $12 billion in an environment that will cause that equity raising to be very expensive. Let’s not forget the current results come just after of the announcement earlier this month that an auditor found “material weakness” in AIG’s accounting. Then AIG said it had to write down the value of the portfolio of derivatives by $4.88 billion for October and November. That indicates that in December, the value of that portfolio declined by an additional $6.24 billion.
That just does not jive with a “fortress balance sheet”.
Sullivan now has a job because no one wants it. As soon as folks view the worst is over for AIG candidates will begin to emerge. The Board will then take action to find a successor to Sullivan.
Disclosure (“none” means no position):None
Upgrades
Nippon Telegr (NTT)- UBS Neutral » Buy
DISH Network (DISH)- Kaufman Bros Hold » Buy
Glu Mobile (GLUU)- Morgan Keegan Mkt Perform » Outperform
Staples (SPLS)- Jefferies & Co Hold » Buy
ADC Telecom (ADCT)- Jefferies & Co Hold » Buy
Genzyme (GENZ)- Bernstein Mkt Perform » Outperform
Evergreen Solar (ESLR)- Jefferies & Co Hold » Buy
Sun Microsystems (JAVA)- Wachovia Mkt Perform » Outperform
Nexen (NXY)- Lehman Brothers Equal-Weight » Overweight
Downgrades
MoneyGram (MGI)- JMP Securities Mkt Outperform » Mkt Perform
USANA (USNA)- Wedbush Morgan Buy » Hold $24 » $26
Corp Office Props (OFC)- Wachovia Mkt Perform » Underperform
Canadian Solar (CSIQ)- Collins Stewart Buy » Hold
Fluor (FLR)- Stanford Research Hold » Sell
Ariba (ARBA)- Roth Capital Buy » Hold
Cameco (CCJ)- UBS Buy » Neutral
Crystal River Capital (CRZ)- Wachovia Outperform » Mkt Perform
Canadian Solar (CSIQ)- Broadpoint Capital Strong Buy » Buy
Wabtec (WAB)- KeyBanc Capital Mkts Buy » Hold
Genco Shipping & Trading (GNK)- Credit Suisse Outperform » Neutral
EDS (EDS)- Bernstein Outperform » Mkt Perform
Spectrum Brands (SPC)- Sun Trust Rbsn Humphrey Buy » Neutral
Sunstone Hotel (SHO)- UBS Buy » Neutral
Anadigics (ANAD)- Oppenheimer Outperform » Perform
Upgrades
Nippon Telegr (NTT)- UBS Neutral » Buy
DISH Network (DISH)- Kaufman Bros Hold » Buy
Glu Mobile (GLUU)- Morgan Keegan Mkt Perform » Outperform
Staples (SPLS)- Jefferies & Co Hold » Buy
ADC Telecom (ADCT)- Jefferies & Co Hold » Buy
Genzyme (GENZ)- Bernstein Mkt Perform » Outperform
Evergreen Solar (ESLR)- Jefferies & Co Hold » Buy
Sun Microsystems (JAVA)- Wachovia Mkt Perform » Outperform
Nexen (NXY)- Lehman Brothers Equal-Weight » Overweight
Downgrades
MoneyGram (MGI)- JMP Securities Mkt Outperform » Mkt Perform
USANA (USNA)- Wedbush Morgan Buy » Hold $24 » $26
Corp Office Props (OFC)- Wachovia Mkt Perform » Underperform
Canadian Solar (CSIQ)- Collins Stewart Buy » Hold
Fluor (FLR)- Stanford Research Hold » Sell
Ariba (ARBA)- Roth Capital Buy » Hold
Cameco (CCJ)- UBS Buy » Neutral
Crystal River Capital (CRZ)- Wachovia Outperform » Mkt Perform
Canadian Solar (CSIQ)- Broadpoint Capital Strong Buy » Buy
Wabtec (WAB)- KeyBanc Capital Mkts Buy » Hold
Genco Shipping & Trading (GNK)- Credit Suisse Outperform » Neutral
EDS (EDS)- Bernstein Outperform » Mkt Perform
Spectrum Brands (SPC)- Sun Trust Rbsn Humphrey Buy » Neutral
Sunstone Hotel (SHO)- UBS Buy » Neutral
Anadigics (ANAD)- Oppenheimer Outperform » Perform
Thank you,
Todd Sullivan
Sent from my BlackBerry® wireless device
—–Original Message—–
From: "WSJ.com Editors" <access@interactive.wsj.com>
Date: Wed, 14 May 2008 14:41:19
To:TODD.SULLIVAN1@GMAIL.COM
Subject: WSJ NEWS ALERT: Polar Bear to Be Designated as Threatened Species
__________________________________
NEWS ALERT
from The Wall Street Journal
May 14, 2008
The Interior Department has decided to protect the polar bear as a threatened species, amid a decline in Arctic sea ice due to global warming, handing environmentalists a major victory. Opponents said it could trigger new obstacles for oil companies seeking to drill in the Arctic. The official announcement was to come from Interior Secretary Dirk Kempthorne later this afternoon.
For more information, see:
http://online.wsj.com/article/SB121078668964492405.html?mod=djemalertNEWS
The article link above is also mobile friendly. Mobile users, click the link to see this story now.
Copyright 2008 Dow Jones & Company, Inc. All Rights Reserved.
Would it be best, or just easiest for Citigroup (C) to break up?
Cohen makes the point that the concept cannot succeed. Perhaps a plan like the one UBS (UBS) is going to attempt. The problem with breaking up in a down market is that you will get a small fraction of the true worth of the assets you are selling.
Pandit’s current plan to gradually sell of smaller, insignificant assets is the preferred way as it maximizes the value shareholders get for the assets that are sold. While it may take a while for the “worm to turn” so to speak, the end product will be better and stronger.
Cohen does in a way contradict himself when he says that JP Morgan (JPM) is making the supermarket concept work, but Citi has not been able to. Well, if that is true than it is a management issue, not a model one. If that is true, then why rush to break it up before Pandit is given a chance to fix it?
If he can, the shareholders win big, if not, then he can sell assets later at better prices, shareholders win.
The rush to break it up seems a bit short sighted at this point…
Disclosure (“none” means no position):Long C, None
Now, here is a concentrated equity portfolio.
Leucadia’s (LUK) 13-F reveals equity holdings in just 7 companies:
Amount of holdings in millions:
Americredit (ACF)= $295
Capital Southwest (CSWC)= $2.4
Cresund (CRESY)= $51.3
Georesources (GEOI)= $4.6
International Assets Holding (IAAC)= $34.5
Jefferies (JEF)= $68.8
United Western Bank (UWBK) = $2.2
Total= $458.8
The interesting part is that 88% of the portfolio is in financials. United, Amercredit, Capital, International Assets and Jefferies are all in the financial sector in some form.
Now, that is concentration…
Disclosure (“none” means no position):None
Whole Foods (WFMI) released results and profit fell 13%, again proving like Starbucks’ (SBUX) results, consumers will go for the less expensive option for like items..
Whole Foods reported results for the 12-week second quarter ended April 13, 2008. Sales increased 27.6% to approximately $1.9 billion. Identical same store sales increased 5.1%. Net income was approximately $40.0 million, and diluted earnings per share were $0.29 (vs 32 cents a year earlier). The Company estimates the negative impact on net income from Wild Oats was approximately $8.6 million, or $0.06 per diluted share, in the quarter”
In February I said, “The stock now sits just above its 52 week low and is still trading at an excessive premium to earnings. With organic food being found at about every grocer including club stores like Costco (COST), BJ’s (BJ) and Wal-Mart’s (WMT) Sam’s Club, a pinched consumer is far less likely to visit Macke’s locations.”
Since then things for shareholders have deteriorated further. The stocks now trades 30% lower at Oct. 2003 levels as sales growth has slowed. While the company backed its same store sales number of 7.5% to 9.5%, given results to date, one has to think that will turn out to be just way too optimistic.
Like Starbucks, Whole Foods is being hit by a slowing economy and increased competition. Both, unfortunately, are not reacting to it and actually seem to be denying the effect of competitors, preferring instead to focus on macro conditions.
The problem with that is growth for both slowed before macro conditions deteriorated. One can only assume that it was because customers we able to find organic meat, eggs and juices at their local markets and rather than make the trip to pay premium prices, choose “the same for less”.
On the earnings call CEO Mackey said “Results varied based on many factors including differing degrees of cannibalization from new stores, competition, and changes in the economy, making it hard to attribute our performance to one factor over another. We do believe we have experienced a greater amount of cannibalization this year related to the acceleration in our new store openings.”
Now, while all of these are true, pricing is still a huge issue with now more price conscious consumers. Yet, this was not addressed.
It also is a bit bothersome that they still are focusing on “results excluding Wild Oats”. When will this stop? It is yours now and the argument can be made you did not need to buy it, stop telling us that “without it things would be better”. Shouldn’t the argument you be making is that “because of it things are better”? You own it, stop trying to exclude it.
Here is the good news for investors. Unlike Starbucks, Whole Foods seems to be far more forthcoming with investors, even if one could argue with their conclusions. Also, they do have a far more diverse product mix that is not as easily copied like Starbucks.
Are shares a buy now? Not yet. Even now shares still trade at 24 times current years earnings that are falling. If you think the economy will be stagnant for a while (I do) then that number will have to fall, much farther. Another bad quarter ought to lead to full year downward revisions and another buzz cut to the share price. I can envision this thing dropping to a mid teen PE which means a high teen share price.
Then, and only then does it get interesting
Disclosure (“none” means no position):None
Hank Greenberg sounds of in this interview about the management of the company he is still a major shareholder of.
Part 1
Part 2
It is hard to argue with the buy who created the company even if many of the transactions hurting the company today, were done on his watch. It is probably more of a function of current management being late to recognize the situation they were in and due to that, being too late to react.
Current CEO Sullivan will be out of a job soon not for these losses, but of making the cardinal sin of telling shareholders he did not expect any material write-downs and now saying $12 billion must be raised to cover the write-downs he said would not be there. For the results of actions like this see Citi’s (C) Chuck Prince, Merrill’s Stan O’Neil (MER) and Wachovia’s (WB) Ken Thompson.
The “they are not my deals” argument does not go far because it then becomes a “you did not know what was going on one” and neither will allow you to keep a job.
Disclosure (“none” means no position):None
RI Lead Trial, OPEC, SUV’s, Yahoo
– This would be just great.
– Hysteria…. $6 gas would not make many people I know get rid of theirs….
– This dope will end up selling to Microsoft (MSFT) for less than the original offer..
RI Lead Trial, OPEC, SUV’s, Yahoo
– This would be just great.
– Hysteria…. $6 gas would not make many people I know get rid of theirs….
– This dope will end up selling to Microsoft (MSFT) for less than the original offer..
Upgrades
Fluor (FLR)- Lazard Capital Hold » Buy
Medarex (MEDX)- Needham Hold » Buy
Dynamic Materials (BOOM)- KeyBanc Capital Mkts Hold » Buy
Barr Pharma (BRL)- Cowen & Co Neutral » Outperform
RadioShack (RSH)- RBC Capital Mkts Underperform » Sector Perform
South Fincl Group (TSFG)- Keefe Bruyette Mkt Perform » Outperform
IberiaBank (IBKC)- Keefe Bruyette Underperform » Mkt Perform
Sovereign Banc (SOV)- Friedman Billings Underperform » Mkt Perform
Downgrades
Western Refining (WNR)- Caris & Company Average » Sell
iPass (IPAS)- Janco Partners Buy » Mkt Perform
Bankunited Fin (BKUNA)- Sterne Agee Buy » Hold
Mentor Corp (MNT)- Lazard Capital Buy » Hold
EDS (EDS)- Stifel Nicolaus Buy » Hold
DRS Tech (DRS)- Stifel Nicolaus Buy » Hold
Nxstage Medical (NXTM)- William Blair Outperform » Mkt Perform
Gerdau AmeriSteel (GNA)- KeyBanc Capital Mkts Buy » Hold
MIVA (MIVA)- Morgan Joseph Buy » Hold
LHC Group (LHCG)- Wachovia Outperform » Mkt Perform
BearingPoint (BE)- Citigroup Buy » Hold
EDS (EDS)- Citigroup Hold » Sell
Hancock Holding (HBHC)- Keefe Bruyette Outperform » Mkt Perform
Smith & Nephew (SNN)- JP Morgan Neutral » Underweight
EDS (EDS)- Friedman Billings Outperform » Mkt Perform
Upgrades
Fluor (FLR)- Lazard Capital Hold » Buy
Medarex (MEDX)- Needham Hold » Buy
Dynamic Materials (BOOM)- KeyBanc Capital Mkts Hold » Buy
Barr Pharma (BRL)- Cowen & Co Neutral » Outperform
RadioShack (RSH)- RBC Capital Mkts Underperform » Sector Perform
South Fincl Group (TSFG)- Keefe Bruyette Mkt Perform » Outperform
IberiaBank (IBKC)- Keefe Bruyette Underperform » Mkt Perform
Sovereign Banc (SOV)- Friedman Billings Underperform » Mkt Perform
Downgrades
Western Refining (WNR)- Caris & Company Average » Sell
iPass (IPAS)- Janco Partners Buy » Mkt Perform
Bankunited Fin (BKUNA)- Sterne Agee Buy » Hold
Mentor Corp (MNT)- Lazard Capital Buy » Hold
EDS (EDS)- Stifel Nicolaus Buy » Hold
DRS Tech (DRS)- Stifel Nicolaus Buy » Hold
Nxstage Medical (NXTM)- William Blair Outperform » Mkt Perform
Gerdau AmeriSteel (GNA)- KeyBanc Capital Mkts Buy » Hold
MIVA (MIVA)- Morgan Joseph Buy » Hold
LHC Group (LHCG)- Wachovia Outperform » Mkt Perform
BearingPoint (BE)- Citigroup Buy » Hold
EDS (EDS)- Citigroup Hold » Sell
Hancock Holding (HBHC)- Keefe Bruyette Outperform » Mkt Perform
Smith & Nephew (SNN)- JP Morgan Neutral » Underweight
EDS (EDS)- Friedman Billings Outperform » Mkt Perform
On Friday, Leucadia (LUK) added 318,422 shares of investment bank Jefferies (JEF) at $17.98 a share. It bring Leucadia’s total ownership to 44,274,000 shares. The shares were purchased by their wholly owned subsidiary, Baldwin Enterprises.
Disclosure (“none” means no position):None
Wednesday’s Picks
Guy Adami recommends Alcoa (AA) $42.12
Karen Finerman suggests Golar (GLNG) $19.59
Pete Najarian prefers Consol Energy (CNX) $95.59
Jeff Macke recommends shorting the Dow with Short Dow30 ProShares (DOG) $60.52
Tuesday’s Results
Jeff Macke likes Wal-Mart (WMT) $58.02 Close $56.65 LOSS
Guy Adami prefers Cisco (CSCO) $25.84 Close $25.89 GAIN
Tim Seymour recommends Turkcell (TKC) $17.99 Close $18.32 GAIN
Pete Najarian thinks Applied Material (AMAT) $19.87 is a buy Close $19.86 LOSS
2008 Records:
Brian Schaeffer= 0-1
Carter Worth= 1-1
Jon Najarian= 4-3
Jeff Macke= 38-28-1
Tim Seymore= 17-13
Guy Adami= 38-32
Pete Najarian= 35-32
Karen Finerman= 32-29-1
Joe Terrenova= 1-1
2007 Results (Since 6/21):
Guy Adami= 58-46 = 56%
Jeff Macke= 60-40 = 60%
Pete Najarian= 49-41 = 54%