Gas, Inflation, Credit, Target (TGT) and Wal-Mart (WMT)
– Stop whining and recognize it could be so much worse
– Another one, things are just not that bad
– You mean, the world is not ending?
– If we would just let the market decide medical prices, things would so much cheaper
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Gas, Inflation, Credit, Target (TGT) and Wal-Mart (WMT)
– Stop whining and recognize it could be so much worse
– Another one, things are just not that bad
– You mean, the world is not ending?
– If we would just let the market decide medical prices, things would so much cheaper
Visit the ValuePlays Bookstore for Great Investing Books
This work is licensed under a Creative Commons Attribution 2.5 License.
Looks like another CEO who made a promise that was not kept is paying a price. span class=”fullpost”>
Wachovia (WB) has stripped Chief Executive Ken Thompson of his chairman role. The move separates the top management position from the top oversight role and is long overdue.
Wachovia named its lead independent director, Lanty Smith, to the position of nonexecutive chairman.
Thompson ought not get comfortable, why?
* The 2006 acquisition of California-based Golden West Financial Corp., a $25 billion deal whose timing, Thompson has acknowledged, “was not the best.”
* In April, Wachovia reported a first-quarter loss of $393 million and announced a 41 percent cut to its dividend.
* This week, that nearly doubled that number to $708 million, or 36 cents per share, after reviewing its portfolio of bank-owned life insurance.
* Last week, they said they may take an after-tax charge of between $800 million and $1 billion in the second quarter tied to past leasing transactions.
* A month ago, Wachovia agreed to pay $144 million to settle federal allegations that it failed to stop telemarketers who took advantage of thousands of elderly consumers.
* Rumors abound that federal prosecutors are investigating Wachovia in a probe into alleged laundering of drug proceeds by Colombian and Mexican money-transfer companies.
Far from getting comfortable, the move may be a precursor to letting Thompson “pursue other opportunities”. At this point, one can probably here former Citi (C) CEO Chuck Prince saying “how the hell does he still have a job”? You know what? He actually has a point. Thompson has hit a bad patch not seen in banking in a long time.
Even if we let go the loan write downs because no one has escaped that. In all reality, others have fared worse so Thompson should not be let go because of it. It is all the other stuff that really has no excuse.
When the Feds are snooping around for multiple reasons, it becomes apparent that there just may need to be a change at the top.
Disclosure (“none” means no position):Long WB, C
Looks like another CEO who made a promise that was not kept is paying a price. span class=”fullpost”>
Wachovia (WB) has stripped Chief Executive Ken Thompson of his chairman role. The move separates the top management position from the top oversight role and is long overdue.
Wachovia named its lead independent director, Lanty Smith, to the position of nonexecutive chairman.
Thompson ought not get comfortable, why?
* The 2006 acquisition of California-based Golden West Financial Corp., a $25 billion deal whose timing, Thompson has acknowledged, “was not the best.”
* In April, Wachovia reported a first-quarter loss of $393 million and announced a 41 percent cut to its dividend.
* This week, that nearly doubled that number to $708 million, or 36 cents per share, after reviewing its portfolio of bank-owned life insurance.
* Last week, they said they may take an after-tax charge of between $800 million and $1 billion in the second quarter tied to past leasing transactions.
* A month ago, Wachovia agreed to pay $144 million to settle federal allegations that it failed to stop telemarketers who took advantage of thousands of elderly consumers.
* Rumors abound that federal prosecutors are investigating Wachovia in a probe into alleged laundering of drug proceeds by Colombian and Mexican money-transfer companies.
Far from getting comfortable, the move may be a precursor to letting Thompson “pursue other opportunities”. At this point, one can probably here former Citi (C) CEO Chuck Prince saying “how the hell does he still have a job”? You know what? He actually has a point. Thompson has hit a bad patch not seen in banking in a long time.
Even if we let go the loan write downs because no one has escaped that. In all reality, others have fared worse so Thompson should not be let go because of it. It is all the other stuff that really has no excuse.
When the Feds are snooping around for multiple reasons, it becomes apparent that there just may need to be a change at the top.
Disclosure (“none” means no position):Long WB, C
After years of denying McDonalds (MCD) and Dunkin Donuts were the competition, Starbucks, (SBUX) in an SEC filing finally admitted they were.
The Seattle Times Reports:
“Starbucks’ former chief executive, Jim Donald, agreed not to work for McDonald’s or Dunkin’ Donuts as part of a noncompetition agreement he signed after being pushed out of the coffee company in January.
He can work for a grocery chain and other fast-food chains, including Wendy’s and Burger King, according to a securities filing by Starbucks today. But McDonald’s and Dunkin’ Donuts “directly compete with Starbucks field of business.”
In return for signing the noncompetition and confidentiality agreements, Donald will receive $1.25 million this year, an amount that Starbucks made public in January.”
He also has to be nice and not say bad things about Starbucks.
This is stunning. First you have CEO Howard Schultz denying the above companies are the competition, Donald himself denied it when he was CEO and now the finally admit it in an SEC filing. For how long have I been saying they just are not honest with shareholders?
I guess this is the question that needs to be asked. What makes Starbucks think either McDonalds or Dunkin would even want him? I mean really. They spent two years kicking him in the teeth to the point they got him fired, now they want him? Why?
This just goes to show the arrogance in Seattle. To actually think either company would be beating down his door just because he was their CEO is absurd. If anything, folks in Seattle ought to be trying to poach the management ranks of MCD or Dunkin.
Since they have officially put it in writing, we can now stop the “competition” games and just perhaps folks in Seattle can actually get down to improving the customer experience rather than just preaching it?
Alas, seeing as how this was slipped in the filing rather than just disclosed, it sadly appears to be more of the same.
Pathetic……….
Disclosure (“none” means no position): Long MCD, None
After years of denying McDonalds (MCD) and Dunkin Donuts were the competition, Starbucks, (SBUX) in an SEC filing finally admitted they were.
The Seattle Times Reports:
“Starbucks’ former chief executive, Jim Donald, agreed not to work for McDonald’s or Dunkin’ Donuts as part of a noncompetition agreement he signed after being pushed out of the coffee company in January.
He can work for a grocery chain and other fast-food chains, including Wendy’s and Burger King, according to a securities filing by Starbucks today. But McDonald’s and Dunkin’ Donuts “directly compete with Starbucks field of business.”
In return for signing the noncompetition and confidentiality agreements, Donald will receive $1.25 million this year, an amount that Starbucks made public in January.”
He also has to be nice and not say bad things about Starbucks.
This is stunning. First you have CEO Howard Schultz denying the above companies are the competition, Donald himself denied it when he was CEO and now the finally admit it in an SEC filing. For how long have I been saying they just are not honest with shareholders?
I guess this is the question that needs to be asked. What makes Starbucks think either McDonalds or Dunkin would even want him? I mean really. They spent two years kicking him in the teeth to the point they got him fired, now they want him? Why?
This just goes to show the arrogance in Seattle. To actually think either company would be beating down his door just because he was their CEO is absurd. If anything, folks in Seattle ought to be trying to poach the management ranks of MCD or Dunkin.
Since they have officially put it in writing, we can now stop the “competition” games and just perhaps folks in Seattle can actually get down to improving the customer experience rather than just preaching it?
Alas, seeing as how this was slipped in the filing rather than just disclosed, it sadly appears to be more of the same.
Pathetic……….
Disclosure (“none” means no position): Long MCD, None
Upgrades
Trans World (TWMC)- B. Riley & Co Neutral » Buy
Viacom (VIA)- BMO Capital Markets Market Perform » Outperform
Old Second Bancorp Inc. (OSBC)- Sandler O’Neill Sell » Hold
Capital Bank Corporation (CBKN)- FTN Midwest Neutral » Buy
ON Semiconductor (ONNN)- Canaccord Adams Hold » Buy
Wachovia (WB)- Credit Suisse Underperform » Neutral
F5 Networks (FFIV)- RBC Capital Mkts Sector Perform » Outperform
Allied Capital (ALD)- BB&T Capital Mkts Hold » Buy
Blackbaud (BLKB)- Jefferies & Co Underperform » Hold
Brandywine Realty (BDN)- RBC Capital Mkts Underperform » Sector Perform
Einstein Noah (BAGL)- Piper Jaffray Neutral » Buy
National Financial Partners (NFP)- Citigroup Hold » Buy
Anworth Mortgage (ANH)- Keefe Bruyette Mkt Perform » Outperform
Downgrades
MacQuarie Infrastructure (MIC)- BMO Capital Markets Outperform » Market Perform
DRS Tech (DRS)- Morgan Joseph Buy » Hold
Momenta Pharma (MNTA)- Bear Stearns Outperform » Peer Perform
Quicksilver Resrcs (KWK)- CapitalOne southcoast Add » Neutral
InterNAP (INAP)- Stanford Research Buy » Hold
Credicorp LTD (BAP)- JP Morgan Overweight » Neutral
YRC Worldwide (YRCW)- Stifel Nicolaus Hold » Sell
Transocean (RIG)- Stifel Nicolaus Buy » Hold
Arkansas Best (ABFS)- Stifel Nicolaus Buy » Hold
Neustar (NSR)- Credit Suisse Outperform » Neutral
InterNAP (INAP)- Cowen & Co Outperform » Neutral
Jefferies Group (JEF)- Wachovia Mkt Perform » Underperform
Boston Beer Co (SAM)- HSBC Securities Overweight » Neutral
Fedrl Rlty Inv Trst (FRT)- Cantor Fitzgerald Buy » Hold
Weingarten Realty (WRI)- Cantor Fitzgerald Hold » Sell
SoundBite Communications (SDBT)- Cantor Fitzgerald Buy » Hold
InterNAP (INAP)- Roth Capital Buy » Hold
Pacific Capital Bancorp (PCBC)- RBC Capital Mkts Sector Perform » Underperform
LifeCell (LIFC)- Wachovia Outperform » Mkt Perform
Alesco (AFN)- RBC Capital Mkts Sector Perform » Underperform
Sprint Nextel (S)- Soleil Overweight » Equal Weight
Orbitz (OWW)- Piper Jaffray Buy » Neutral
Macrovision (MVSN)- Deutsche Securities Buy » Hold
Chelsea Therapeutics (CHTP)- Oppenheimer Outperform » Perform
Eagle Bulk Shipping (EGLE)- Bear Stearns Outperform » Peer Perform
Tenaris (TS)- Citigroup Buy » Hold
Smith & Nephew (SNN)- Citigroup Buy » Hold
Dayton Superior (DSUP)- Robert W. Baird Outperform » Neutral
Clearwire (CLWR)- Citigroup Hold » Sell
Weingarten Realty (WRI)- Citigroup Hold » Sell
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Upgrades
Trans World (TWMC)- B. Riley & Co Neutral » Buy
Viacom (VIA)- BMO Capital Markets Market Perform » Outperform
Old Second Bancorp Inc. (OSBC)- Sandler O’Neill Sell » Hold
Capital Bank Corporation (CBKN)- FTN Midwest Neutral » Buy
ON Semiconductor (ONNN)- Canaccord Adams Hold » Buy
Wachovia (WB)- Credit Suisse Underperform » Neutral
F5 Networks (FFIV)- RBC Capital Mkts Sector Perform » Outperform
Allied Capital (ALD)- BB&T Capital Mkts Hold » Buy
Blackbaud (BLKB)- Jefferies & Co Underperform » Hold
Brandywine Realty (BDN)- RBC Capital Mkts Underperform » Sector Perform
Einstein Noah (BAGL)- Piper Jaffray Neutral » Buy
National Financial Partners (NFP)- Citigroup Hold » Buy
Anworth Mortgage (ANH)- Keefe Bruyette Mkt Perform » Outperform
Downgrades
MacQuarie Infrastructure (MIC)- BMO Capital Markets Outperform » Market Perform
DRS Tech (DRS)- Morgan Joseph Buy » Hold
Momenta Pharma (MNTA)- Bear Stearns Outperform » Peer Perform
Quicksilver Resrcs (KWK)- CapitalOne southcoast Add » Neutral
InterNAP (INAP)- Stanford Research Buy » Hold
Credicorp LTD (BAP)- JP Morgan Overweight » Neutral
YRC Worldwide (YRCW)- Stifel Nicolaus Hold » Sell
Transocean (RIG)- Stifel Nicolaus Buy » Hold
Arkansas Best (ABFS)- Stifel Nicolaus Buy » Hold
Neustar (NSR)- Credit Suisse Outperform » Neutral
InterNAP (INAP)- Cowen & Co Outperform » Neutral
Jefferies Group (JEF)- Wachovia Mkt Perform » Underperform
Boston Beer Co (SAM)- HSBC Securities Overweight » Neutral
Fedrl Rlty Inv Trst (FRT)- Cantor Fitzgerald Buy » Hold
Weingarten Realty (WRI)- Cantor Fitzgerald Hold » Sell
SoundBite Communications (SDBT)- Cantor Fitzgerald Buy » Hold
InterNAP (INAP)- Roth Capital Buy » Hold
Pacific Capital Bancorp (PCBC)- RBC Capital Mkts Sector Perform » Underperform
LifeCell (LIFC)- Wachovia Outperform » Mkt Perform
Alesco (AFN)- RBC Capital Mkts Sector Perform » Underperform
Sprint Nextel (S)- Soleil Overweight » Equal Weight
Orbitz (OWW)- Piper Jaffray Buy » Neutral
Macrovision (MVSN)- Deutsche Securities Buy » Hold
Chelsea Therapeutics (CHTP)- Oppenheimer Outperform » Perform
Eagle Bulk Shipping (EGLE)- Bear Stearns Outperform » Peer Perform
Tenaris (TS)- Citigroup Buy » Hold
Smith & Nephew (SNN)- Citigroup Buy » Hold
Dayton Superior (DSUP)- Robert W. Baird Outperform » Neutral
Clearwire (CLWR)- Citigroup Hold » Sell
Weingarten Realty (WRI)- Citigroup Hold » Sell
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Leucadia (LUK) purchased an additional 1.6 million shares of Jefferies (JEF) on Tuesday, Wednesday and Thursday bringing the total held by the conglomerate to 43.995 million shares
Disclosure (“none” means no position):none
Sears Holdings (SHLD) Chairman Edward Lampert added another 1 million AutoNation (AN) shares this week at between $16.25 and $16.50 a share.
Lampert now controls 68.369 million shares or 38.2% of the outstanding total.
Disclosure (“none” means no position):None
Wilbur Ross paid $250 million today for 10.65 million share of Assured Guarantee (AGO) to complete a previously agreed to private transaction. It works out to about $23.47 a share an approximate 8% discount to today’s $25.39 closing price
Ross now controls 12.1 million shares.
Details:
1. WLR Recovery Fund IV, L.P. (“Fund IV”), WLR Recovery Fund III, L.P. (“Fund III”), WLR IV Parallel ESC, L.P. (“Parallel Fund”) and WLR/GS Master Co-Investment, L.P. (“WLR/GS Fund”) purchased 10,651,896 shares of common stock in connection with the Issuer’s private placement pursuant to an Investment Agreement dated as of February 28, 2008, between Assured Guaranty Ltd. (“AGO”) and Fund IV (the “Investment Agreement”) for cash consideration of $250,000,000 (the “Initial Investment”). WL Ross & Co. LLC (“WLR”), the investment manager of Fund IV, is entitled to allocate purchase obligations under the Investment Agreement (and any associated rights) among the other investment funds it manages. On May 6, 2008, Fund IV, Fund III and Parallel Fund transferred 768,002 shares of AGO common stock to its affiliate, WLR AGO Co-Invest, L.P. (“Co-Invest Fund”). (Continued Footnote 2)
2. Fund IV is the beneficial owner of 1,379,400 shares of common stock acquired prior to the execution of the Investment Agreement and can be deemed to share voting and dispositive power of an additional 135,100 shares that are owned by Fund III and Parallel Fund, affiliates of Fund IV. (Continued Footnote 3)
3. Co-Invest Fund is the beneficial owner of 768,002 shares of common stock acquired from its affiliates, Fund IV, Fund III and Parallel Fund, in a stock transfer on May 6, 2008. Co-Invest Fund can be deemed to share voting and dispositive power of 1,514,500 shares that were acquired by Fund III, Fund IV and Parallel Fund prior to the execution of the Investment Agreement. (Continued Footnote 4)
4. WLR Recovery Associates IV LLC is the general partner and WL Ross & Co. LLC is the investment manager of Fund IV and Co-Invest Fund. WL Ross Group, L.P. is the managing member of WLR Recovery Associates IV LLC. El Vedado, LLC is the general partner of WL Ross Group, L.P. Wilbur L. Ross, Jr. is the managing member of El Vedado, LLC. Accordingly, Wilbur L. Ross, Jr., El Vedado, LLC, WL Ross Group, L.P., WLR Recovery Associates IV LLC and WL Ross & Co. LLC can be deemed to share voting and dispositive power over the shares to be held by Fund IV and Co-Invest Fund. (Continued Footnote 5)
5. Fund III is the beneficial owner of 130,300 shares of common stock acquired prior to the execution of the Investment Agreement and can be deemed to share voting and dispositive power of an additional 1,384,200 shares that are owned by Fund IV and Parallel Fund, affiliates of Fund III, acquired prior to the execution of the Investment Agreement. (Continued Footnote 6)
6. WLR Recovery Associates III LLC is the general partner and WL Ross & Co. LLC is the investment manager of Fund III. WL Ross Group, L.P. is the managing member of WLR Recovery Associates III LLC. El Vedado, LLC is the general partner of WL Ross Group, L.P. Wilbur L. Ross, Jr. is the managing member of El Vedado, LLC. Accordingly, Wilbur L. Ross, Jr., El Vedado, LLC, WL Ross Group, L.P., WLR Recovery Associates III LLC and WL Ross & Co. LLC can be deemed to share voting and dispositive power over the shares to be held directly by Fund III. (Continued Footnote 7)
7. Parallel Fund is the beneficial owner of 4,800 shares of common stock acquired prior to the execution of the Investment Agreement and can be deemed to share voting and dispositive power of an additional 1,509,700 shares that are owned by Fund III and Fund IV, affiliates of Parallel Fund, acquired prior to the execution of the Investment Agreement. (Continued Footnote 8)
8. INVESCO WLR IV Associates LLC is the general partner of Parallel Fund. INVESCO Private Capital, Inc. is the managing member of INVESCO WLR IV Associates LLC. INVESCO WLR IV Associates LLC and WLR Recovery Associates IV LLC have entered into a parallel investment agreement whereby Parallel Fund will invest on a pro rata basis in the same investments as Fund IV. Accordingly, INVESCO WLR IV Associates LLC, INVESCO Private Capital, Inc. WLR Recovery Associates IV LLC, WL Ross Group, L.P. El Vedado, LLC, WL Ross & Co. LLC and Wilbur L. Ross, Jr. can be deemed to share beneficial ownership over the shares to be held directly by Parallel Fund. (Continued Footnote 9)
9. WLR/GS Fund can be deemed to share voting and dispositive power of 1,514,500 shares that were acquired by Fund III, Fund IV and Parallel Fund, affiliates of WLR/GS Fund, prior to the execution of the Investment Agreement. (Continued Footnote 10)
10. WLR Master Co-Investment GP, LLC is the general partner and WL Ross & Co. LLC is the investment manager of WLR/GS Fund. WL Ross Group, L.P. is the managing member of WLR Master Co-Investment GP, LLC. El Vedado, LLC is the general partner of WL Ross Group, L.P. Wilbur L. Ross, Jr. is the managing member of El Vedado, LLC. Accordingly, Wilbur L. Ross, Jr., El Vedado, LLC, WL Ross Group, L.P., WLR Master Co-Investment GP, LLC and WL Ross & Co. LLC can be deemed to share voting and dispositive power over the shares to be held by WLR/GS Fund. ( Continued Footnote 11)
11. Shares are directly owned by Fund IV, Fund III, Parallel Fund, WLR/GS Fund and Co-Invest Fund. (Continued Footnote 12)
12. Shares directly owned by WLR Recovery Fund IV, L.P., WLR Recovery Fund III, L.P., WLR/GS Master Co-Investment, L.P., WLR IV Parallel ESC, L.P. and WLR AGO Co-Invest, L.P.
Remarks:
Disclosure (“none” means no position):none
Friday’s Picks
Guy Adami likes Cisco (CSCO) $25.7 as a buy.
Karen Finerman prefers getting long JP Morgan (JPM) $46.05
Pete Najarian suggests picking up shares of Nike (NKE) $64.8
Jeff Macke thinks it time to take profits in Activision (ATVI) $27.7
Thursday’s Results
Jeff Macke recommends trimming any position in the United States Oil Fund (USO) $99.8 Close $100.66 GAIN
Guy Adami prefers to bet against the Dow by getting long Short Dow30 ProShares (DOG) $60.71 Close $60.49 LOSS
Karen Finerman suggests Yahoo (YHOO) $25.64 for 3 days only. Close $26.22 GAIN
Pete Najarian thinks the United States Natural Gas Fund (UNG) $54.25 is a buy. Close $54.0 LOSS
2008 Records:
Brian Schaeffer= 0-1
Carter Worth= 1-1
Jon Najarian= 4-3
Jeff Macke= 35-28-1
Tim Seymore= 16-13
Guy Adami= 36-31
Pete Najarian= 34-30
Karen Finerman= 30-29-1
Joe Terrenova= 1-1
2007 Results (Since 6/21):
Guy Adami= 58-46 = 56%
Jeff Macke= 60-40 = 60%
Pete Najarian= 49-41 = 54%
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In October I wrote a post about Direct TV (DTV) and said “at $26 shares are fairly priced…should they dip to $20 again, you have a great buying opportunity”. Well, in Jan. 2008 they did just that and are up 35% since then.
After recent results, shares have even more upside. Back in October the jist of my post was that the scope of HD offerings from Direct TV vs cable would bring in scores of new customers. Since then, the company has dropped the price of the HD DVR it sells from $399 t $199 tempting even me to get it.
Then this week they announced they added 275,000 net U.S. subscribers, well above analyst expectations of about 180,000, and increased its domestic subscriber base by 5.2% to 17.1 million.
They also announced a $2.5 billion dollar share repurchase plan (8% of market cap).
There are other potential earnings drivers down the road such as a plan for video-on-demand and and internet over power line that are testing. Conveniences of programming your DVR by cell phone or computer also give customers a wide array of features.
Shares could be bought on the next dip and held for the long term..
Disclosure (“none” means no position):Customer only, None
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McDonalds had its 60th consecutive month of global same store sales increases today.
McDonald’s (MCD) announced today that global comparable sales increased 5.0% in April and 6.8% year-to-date. Systemwide sales for McDonald’s worldwide restaurants increased 13.7% in April, or 6.5% in constant currencies.
McDonald’s Chief Executive Officer Jim Skinner said, “We’re listening to our customers and giving them what they expect from McDonald’s – menu variety, enhanced convenience and everyday value. This ongoing customer focus and execution through our Plan to Win is driving the sustained momentum of our global business.”
U.S. comparable sales rose 2.0% for the month as McDonald’s breakfast menu, new products and compelling value attracted more customers into our restaurants.
This comes on the heals of Burger King’s increased quarterly results earlier.
Good coffee and long hours……
Disclosure (“none” means no position):Long MCD, none
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McDonalds had its 60th consecutive month of global same store sales increases today.
McDonald’s (MCD) announced today that global comparable sales increased 5.0% in April and 6.8% year-to-date. Systemwide sales for McDonald’s worldwide restaurants increased 13.7% in April, or 6.5% in constant currencies.
McDonald’s Chief Executive Officer Jim Skinner said, “We’re listening to our customers and giving them what they expect from McDonald’s – menu variety, enhanced convenience and everyday value. This ongoing customer focus and execution through our Plan to Win is driving the sustained momentum of our global business.”
U.S. comparable sales rose 2.0% for the month as McDonald’s breakfast menu, new products and compelling value attracted more customers into our restaurants.
This comes on the heals of Burger King’s increased quarterly results earlier.
Good coffee and long hours……
Disclosure (“none” means no position):Long MCD, none
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