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Author: ToddSullivan

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The Week's Top Ten at VIN

Post author By ToddSullivan
Post date April 25, 2008

Weekend reading at Value investing News
1. Susan Buffett interview 8/26/2004
(via www.charlierose.com)

A remembrance of philanthropist Susan Thompson Buffet. She talks a lot about Warren Buffett.

2. Visit with Warren Buffett
(via www.bengrahaminvesting.ca)

On March 31, 2008 students from Dr. Athanassakos’ Value Investing class travelled to Omaha, Nebraska to meet with Mr. Warren Buffet, the world’s best known investor and the richest person in the world.

3. Buffett Leans on Italian Guide for Europe Investment
(via www.bloomberg.com)

Billionaire Warren Buffett, who will embark on a four-city European trip next month to meet with owners of family businesses, has for years been laying the groundwork for an acquisition in Europe.

4. Doubling Down in Financials – Interview with Richard Pzena
(via www.forbes.com)

When it comes to value investing or buying out-of-favor stocks, patience is a virtue. These days few are more virtuous than Richard Pzena, Chairman of Pzena Investment Management, a $20 billion assets money management company whose New York Stock Exchange listed shares are down more than 38% in the last 12 months.

5. The Money Kept Vanishing
(via online.wsj.com)

David Einhorn’s New Book “Fooling Some of the People All of the Time”

6. Roger Lowenstein : Triple-A Failure
(via www.nytimes.com)

In 1996, Thomas Friedman, the New York Times columnist, remarked on “The NewsHour With Jim Lehrer” that there were two superpowers in the world — the United States and Moody’s bond-rating service — and it was sometimes unclear which was more powerful.

7. Buffett, Seeking Acquisitions, to Travel to Europe
(via www.bloomberg.com)

April 22 (Bloomberg) — Billionaire investor Warren Buffett will visit Europe next month to scout potential acquisitions, said an executive at an Italian refiner who is organizing the tour.

8. Business Sector Breakdown of the Magic Formula
(via www.magicdiligence.com)

Does the Magic Formula screen favor certain types of businesses? And if so, why? These are the questions we’ll examine in this new series examining which business sectors most frequently appear in the Magic Formula screen.

9. Looking Up to Warren Buffett
(via www.smartmoney.com)

T OFTEN SEEMS like every hedge-fund manager is reading from the same playbook about how to look, work and behave. Neatly pressed khakis; thumbs glued to a BlackBerry; slick digs in Greenwich or Manhattan staffed by number-crunching research drones. But apparently, Mohnish Pabrai never got his copy.

10. MFI Stock List Additions for Week Ending April 18, 2008
(via magicformulainvestor.blogspot.com)

Five new stocks were added to the Magic Formula List last week.

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The Week’s Top Ten at VIN

Post author By ToddSullivan
Post date April 25, 2008

Weekend reading at Value investing News
1. Susan Buffett interview 8/26/2004
(via www.charlierose.com)

A remembrance of philanthropist Susan Thompson Buffet. She talks a lot about Warren Buffett.

2. Visit with Warren Buffett
(via www.bengrahaminvesting.ca)

On March 31, 2008 students from Dr. Athanassakos’ Value Investing class travelled to Omaha, Nebraska to meet with Mr. Warren Buffet, the world’s best known investor and the richest person in the world.

3. Buffett Leans on Italian Guide for Europe Investment
(via www.bloomberg.com)

Billionaire Warren Buffett, who will embark on a four-city European trip next month to meet with owners of family businesses, has for years been laying the groundwork for an acquisition in Europe.

4. Doubling Down in Financials – Interview with Richard Pzena
(via www.forbes.com)

When it comes to value investing or buying out-of-favor stocks, patience is a virtue. These days few are more virtuous than Richard Pzena, Chairman of Pzena Investment Management, a $20 billion assets money management company whose New York Stock Exchange listed shares are down more than 38% in the last 12 months.

5. The Money Kept Vanishing
(via online.wsj.com)

David Einhorn’s New Book “Fooling Some of the People All of the Time”

6. Roger Lowenstein : Triple-A Failure
(via www.nytimes.com)

In 1996, Thomas Friedman, the New York Times columnist, remarked on “The NewsHour With Jim Lehrer” that there were two superpowers in the world — the United States and Moody’s bond-rating service — and it was sometimes unclear which was more powerful.

7. Buffett, Seeking Acquisitions, to Travel to Europe
(via www.bloomberg.com)

April 22 (Bloomberg) — Billionaire investor Warren Buffett will visit Europe next month to scout potential acquisitions, said an executive at an Italian refiner who is organizing the tour.

8. Business Sector Breakdown of the Magic Formula
(via www.magicdiligence.com)

Does the Magic Formula screen favor certain types of businesses? And if so, why? These are the questions we’ll examine in this new series examining which business sectors most frequently appear in the Magic Formula screen.

9. Looking Up to Warren Buffett
(via www.smartmoney.com)

T OFTEN SEEMS like every hedge-fund manager is reading from the same playbook about how to look, work and behave. Neatly pressed khakis; thumbs glued to a BlackBerry; slick digs in Greenwich or Manhattan staffed by number-crunching research drones. But apparently, Mohnish Pabrai never got his copy.

10. MFI Stock List Additions for Week Ending April 18, 2008
(via magicformulainvestor.blogspot.com)

Five new stocks were added to the Magic Formula List last week.

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Altria (MO) Earnings Call Notes

Post author By ToddSullivan
Post date April 25, 2008

Notes from the Altria (MO) earnings call..The focus hereis on smokeless products as the potential market for Altria is large..

Regarding smokeless products:
Judy Hong – Goldman Sachs & Company, Inc.: “Okay. And then just… in terms of your Snus and the snuff product, can you talk about whether there is… the spending in the first quarter was also impacted by the investment behind those brands. I mean I imagine that they were just a limited test market, so that would not be the case, but can you talk about that and just maybe give us a color in terms of how you are seeing any progress on those products in your test markets?”

David R. Beran – Executive Vice President and Chief Financial Officer: “Yes, I’d be happy to. As we said or as I said back in the road show and when I was meeting with the investors is that this year the Marlboro Snus and Marlboro snuff were in the investment mode. So, we actually spent more money in the first quarter behind those two initiatives than we did a year ago because we weren’t in test markets then. Is it material? No, it’s not, but it was a slight drag in the first quarter. As we look at those two test markets, we expanded both test markets. I’ll take the moist snuff first, we expanded that into 50 counties surrounding Atlanta and we’re getting great learning from that test market on how consumers feel about the product, the overall product, their overall packaging and promotional strategy in the marketplace. When you look at Marlboro Snus, we expanded Marlboro Snus from Dallas into Indi, where we replaced Taboka Snus in that marketplace. And this same sort of learning has taken place there. We’re looking at all the elements of our value equation and when I say that it’s product, packaging, positioning, and promotion out in the marketplace. And between those two initiatives, we believe that the Marlboro Snus product initiative is a longer-term play because that category does not exist in the U.S. marketplace with any potential size. But we still think that it is a promising category for us to be in.”

Another smokelss question:

Filippe Goossens – Credit Suisse: “Okay. And then my final question, perhaps a follow-up on Judy’s earlier question on Snus. It’s kind of interesting when we look at the enthusiasm of Reynolds in terms of expanding the test marketing to 17 markets now, including some kind of metropolitan markets and contrast that with the somewhat less enthusiastic comments in terms of UST’s longer experience with Snus, it kind of brings up two questions. The first one is obviously you already commented on that you see this as more a longer-term project, still I would like to kind of get more an impression from you, whether you really view this as a category that where the passage of time can meaningfully contribute to your EPS? And secondly, if I follow more kind of the comments from UST this morning, I kind of wonder if consumers will have a tough time embracing Snus as a category. It makes me wonder how they will embrace all these reduced risk or reduced harm products that the industry has been talking about for so long. So, in other words if it’s tough to embrace Snus, why would they embrace reduced risk products any quicker than what we’re seeing with Snus so far?”

David R. Beran – Executive Vice President and Chief Financial Officer: “Let me address the Snus comment… the question. When we went down this path, we spent a lot of time before we even went out into the marketplace, understanding the Snus model in Sweden. And understanding what potential consumers, adult smokers would think about Snus in the U.S. marketplace. And we saw an opportunity, we still see an opportunity and our first… our first entrance so to speak with Snus in the U.S. marketplace was with Taboka. And we use Taboka, so we could get an understanding with consumers before we decided to put Marlboro on the Snus product from a branding standpoint. And what we learned in Indi gave us confidence that the Snus marketplace can develop here in the U.S., but even today when we look at Snus and that’s why we are still in a learning mode both in Dallas and Indi. We don’t think we have it exactly right, we don’t think anyone does yet in the U.S. marketplace because we are creating a new category. And… but we will continue to get learnings from those test markets and at this point we are still confident that it will be a longer-term play in the U.S. marketplace, but that this category can develop.”

While it may be frustrating (it is) at the length of time it is taking for the smokeless products to be rolled out, when you have a brand like Marlboro, which one could argue may be one of the world’s most valuable brands, you cannot risk damage to it. Altria is taking its time and based on the testing success so far, seems to be getting the product right.

We really do not want a “New Coke” (KO) fiasco.

Disclosure (“none” means no position):Long MO

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Another view on Starbucks

Post author By ToddSullivan
Post date April 25, 2008

Here is another opinion on Starbucks (SBUX).

Disclosure (“none” means no position):None

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Sears (SHLD) and Bank of America (BAC): No Big Deal

Post author By ToddSullivan
Post date April 25, 2008

A quick read of the headlines would lead one the believe the recent credit line non-renewal between Sears Holdings (SHLD) and Bank of America (BAC) is ominous for the retailer. To the contrary, it is an example of a well capitalized company telling a bank to take a hike.

Background (from the SEC filing by Sears):
“On April 14, 2008, Bank of America, N.A., as Issuing Bank under the Letter of Credit Agreement dated as of August 13, 2004, as amended (the “LC Agreement”), among Sears Holdings Corporation, Sears Roebuck Acceptance Corp., Sears, Roebuck and Co. and Kmart Corporation and Bank of America, N.A., advised us that it would not agree to renew the LC Agreement under its existing terms. The current term of the LC Agreement, which is a 364-day secured facility with a commitment amount of up to $1.0 billion, is scheduled to end in July 2008. At April 18, 2008, only $1.6 million in letters of credit were outstanding under the LC Agreement, which provides solely for the issuance of letters of credit and does not provide for direct borrowings. Substantially all of our outstanding letters of credit are issued under our $4.0 billion, five-year revolving credit facility (expiring March 2010), which has a $1.5 billion letter of credit sublimit (the “$4 Billion Revolver”).

We have maintained the LC Agreement as a facility to enable the Company to cost-effectively issue letters of credit when surplus cash is available to collateralize the letters of credit. As we are now using our other facility (the $4.0 Billion Revolver) for substantially all our letter of credit needs, the termination of the LC Agreement is not expected to have any effect on Sears Holdings’ liquidity.

No early termination penalties or fees would be incurred by us if the LC Agreement were to terminate at the end of the current term. We are evaluating whether or not we will replace the LC Agreement at this time.”

So we have a $1 billion credit line that has only $1.6 million outstanding on it and a $4 billion revolving credit in place.

The real story is here than Bank of America is looking to squeeze every penny out of every loan they can to offset mortgage related losses. It is important to note that BAC never said they would NOT renew it, they just got greedy (or desperate). Since Sears has a fantastic balance sheet and another $4 billion credit of out there, they politely told BAC where to go.

Not renewing a credit line that is not even being used is hardly a the big deal that is being made of it out there.

Disclosure (“none” means no position):Long SHLD, None

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Friday’s Upgrades and Downgrades

Post author By ToddSullivan
Post date April 25, 2008

Upgrades
LSI Logic (LSI)- Caris & Company Average » Above Average
Apple (AAPL)- Morgan Keegan Underperform » Mkt Perform
Southwest Bancorp (OKSB)- FTN Midwest Neutral » Buy
True Religion (TRLG)- Morgan Keegan Mkt Perform » Outperform
QLT Inc (QLTI)- RBC Capital Mkts Sector Perform » Outperform
Everest Re (RE)- Citigroup Hold » Buy
RF Micro Device (RFMD)- Jefferies & Co Hold » Buy
Level 3 (LVLT)- Merriman Curhan Ford Sell » Neutral
Zions Bancorp (ZION)- Robert W. Baird Neutral » Outperform

Downgrades
Grey Wolf (GW)- BMO Capital Markets Outperform » Market Perform
GMX Resources (GMXR)- CapitalOne southcoast Add » Neutral
VASCO Data Security (VDSI)- Morgan Keegan Outperform » Mkt Perform
Parallel Petroleum (PLLL)- CapitalOne southcoast Strong Buy » Add
II-VI Inc (IIVI)- Needham Buy » Hold
Hilb, Rogal & Hobbs (HRH)- Stifel Nicolaus Buy » Hold
Extreme Networks (EXTR)- JMP Securities Mkt Outperform » Mkt Perform
JAKKS Pacific (JAKK)- Morgan Joseph Buy » Hold
Teradyne (TER)- HSBC Securities Overweight » Neutral
Tomotherapy (TOMO)- Soleil Hold » Sell
XM Satellite (XMSR)- Citigroup Buy » Hold
Barrett Business (BBSI)- Roth Capital Buy » Hold
EastGroup (EGP)- Cantor Fitzgerald Buy » Hold
The Inventure Grp (SNAK)- Roth Capital Buy » Hold
NewMarket (NEU)- Oppenheimer Outperform » Perform
DIRECTV (DTV)- Bernstein Outperform » Mkt Perform
Take-Two (TTWO)- Citigroup Buy » Hold
Maidenform Brands (MFB)- UBS Neutral » Sell
First Midwest Banc (FMBI)- Oppenheimer Outperform » Perform
Tellabs (TLAB)- GARP Research Buy » Neutral

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Friday's Upgrades and Downgrades

Post author By ToddSullivan
Post date April 25, 2008

Upgrades
LSI Logic (LSI)- Caris & Company Average » Above Average
Apple (AAPL)- Morgan Keegan Underperform » Mkt Perform
Southwest Bancorp (OKSB)- FTN Midwest Neutral » Buy
True Religion (TRLG)- Morgan Keegan Mkt Perform » Outperform
QLT Inc (QLTI)- RBC Capital Mkts Sector Perform » Outperform
Everest Re (RE)- Citigroup Hold » Buy
RF Micro Device (RFMD)- Jefferies & Co Hold » Buy
Level 3 (LVLT)- Merriman Curhan Ford Sell » Neutral
Zions Bancorp (ZION)- Robert W. Baird Neutral » Outperform

Downgrades
Grey Wolf (GW)- BMO Capital Markets Outperform » Market Perform
GMX Resources (GMXR)- CapitalOne southcoast Add » Neutral
VASCO Data Security (VDSI)- Morgan Keegan Outperform » Mkt Perform
Parallel Petroleum (PLLL)- CapitalOne southcoast Strong Buy » Add
II-VI Inc (IIVI)- Needham Buy » Hold
Hilb, Rogal & Hobbs (HRH)- Stifel Nicolaus Buy » Hold
Extreme Networks (EXTR)- JMP Securities Mkt Outperform » Mkt Perform
JAKKS Pacific (JAKK)- Morgan Joseph Buy » Hold
Teradyne (TER)- HSBC Securities Overweight » Neutral
Tomotherapy (TOMO)- Soleil Hold » Sell
XM Satellite (XMSR)- Citigroup Buy » Hold
Barrett Business (BBSI)- Roth Capital Buy » Hold
EastGroup (EGP)- Cantor Fitzgerald Buy » Hold
The Inventure Grp (SNAK)- Roth Capital Buy » Hold
NewMarket (NEU)- Oppenheimer Outperform » Perform
DIRECTV (DTV)- Bernstein Outperform » Mkt Perform
Take-Two (TTWO)- Citigroup Buy » Hold
Maidenform Brands (MFB)- UBS Neutral » Sell
First Midwest Banc (FMBI)- Oppenheimer Outperform » Perform
Tellabs (TLAB)- GARP Research Buy » Neutral

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"Fast Money" for Friday

Post author By ToddSullivan
Post date April 24, 2008

Friday’s Picks
Jeff Macke, Guy Adami and Karen Finerman all think Microsoft (MSFT) $31.8 is a buy if it trades below $30.

Pete Najarian prefers Saso (SSL) $57.39

Thursday’s Results
On Wednesday all the traders agree that Microsoft (MSFT) $31.45 is a buy ahead of earnings! Close $31.80 GAIN

2008 Records:
Brian Schaeffer= 0-1
Carter Worth= 1-1
Jon Najarian= 4-3
Jeff Macke= 32-22-1
Tim Seymore= 15-12
Guy Adami= 31-27
Pete Najarian= 34-23
Karen Finerman= 25-25-1
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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Altria (MO) Reports In Line

Post author By ToddSullivan
Post date April 24, 2008

More tobacco, more good results. Today it is Altria’s (MO) turn.

— Net revenues increased 2.8% to $4.4 billion
— Adjusted diluted earnings per share from continuing operations up 12.1% to $0.37 versus $0.33 in the first quarter of 2007
— Altria reaffirms its 2008 guidance for adjusted diluted earnings per share from continuing operations in the range of $1.63 to $1.67, representing a growth rate of approximately 9% to 11%, from a base of $1.50 per share in 2007
— Earnings from continuing operations decreased 11.8% to $614 million
— Marlboro delivers strong retail share gains, up 0.7 share points to 41.5%
— John Middleton, Inc. posts strong cigar volume gains, up 8.2%, driven by Black & Mild
— A $7.5 billion two-year share repurchase program. Altria began repurchasing shares as part of this program in April 2008.

More after the earnings call tomorrow. Of particular interest:
— Test of Snus, results?
— Test of Smokeless Tobacco, results?

Disclosure (“none” means no position):Long MO

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Phillip Morris International (PM) Earnings Call Notables

Post author By ToddSullivan
Post date April 24, 2008

Here are some of the interesting exchanges during the recent PMI (PM) earnings call.

Filippe Goossens – Credit Suisse: “Okay. The next question, Hermann, if I have my numbers correct using your $0.46 in dividends for the quarter, if I annualize that and I look at the share price, obviously, the share price will be up this morning, but I’m coming out with less than 4% dividend yield, which puts you at the lower end, particularly compared to the U.S. players out there. When can we expect the dividend payouts to go up, particularly if you look at your very strong balance sheet even after the share buybacks?”

Hermann Waldemer (CFO): “Okay, I think there we have to stay with the facts. The facts are that we have an annual rate of 184. We have $0.46 cents for the quarter. The other fact is that we have a payout ratio of 65%. And the rest is entirely up to the Board and it is a Board decision, including the timing.”

At the new earnings level predicted the payout ought to rise to about $2.05 to $2.10 a share. Probably will not be announced until the fall when EPS for the year is more predictable.

China:
Christine Farkas – Merrill Lynch: “Okay, great. And the final question, Hermann, is on China. Can you just update a little bit on the progress there and what you see in the remainder of the year in both the export business as well as Marlboro within China?”

Hermann Waldemer: “Okay. In China we are really absolutely on track, also, compared to what we said during the road show. So we expect on the domestic market the launch of licensed-produced volume Marlboro in China actually the summer of this year. This is going to come. We are on track on this one.”

After another China question:
“Right. On China, I mean, meaningful EPS impact for this year, no. That’s just too small to have an effect.

Look, I mean, the key point really is for China to be [inaudible] partner of the China National Tobacco Company there. That is really the key in there; it is building long-term relationships in China.

And that has really two elements to it, which is the China domestic element – that is Marlboro licensed production for the summer – and that is then on the other side really doing business internationally with them”

The fact that the largest smoking population in the world is “not yet meaningful” ought to underscore for those wondering how much growth there still is for the company the international smoking market.

On Recent Interval Acquisition:
Thomas Russo – Russo, Gardner & Gardner: “You bet. A couple of questions. First, talk about the Interval acquisition and what the market is like in France for leaves. I think that’s where you suggested that it was intended to serve your needs. And then what’s the market like for fine cut in France?”

Hermann Waldemer: “Okay. Interval, actually, I mean, on that acquisition I would say we have said before that we are a tobacco company. There you see we mean that serious. Actually, Interval has a 14.8% share of the fine cut market in France. An estimated operating company’s income of that would be some 25 million Euros. That’s about the size of the business there.

Important is actually this is the leading brand amongst young adults, legal age to 29. So it complements, I would say, our portfolio very nicely. We have been in that market in the entire EU region quite a bit, but we have been in there mostly with our cigarette trademarks and there we really have now a real grow-your-own trademark there, we have acquired there, so that’s another positive of that acquisition.”

Other notes:
* Currency was $.09 of the $.20 earnings beat
* $13 billion, two year stock repurchase begins in May.

Disclosure (“none” means no position):Long PM

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David Dremen on Opportunities

Post author By ToddSullivan
Post date April 24, 2008
1 Comment on David Dremen on Opportunities

Dremen discusses oil (USO), Conoco Phillips (COP), Bank of America (BAC), Lowes (LOW) and Altria (MO)

Disclosure (“none” means no position):Long MO,USO

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Sovereign Wealth Funds: Less Powerful Than Pension Plans

Post author By ToddSullivan
Post date April 24, 2008

Some Fed testimony today shed light on the fallacy that we ought to fear Sovereign Wealth Funds power….In fact, they are less powerful than insurance companies, pension funds ans US mutual funds.

From the testimony:
“One of the reasons that sovereign wealth funds have attracted more attention in the past year is their size. The largest funds are very large. For example, Norway’s sovereign wealth fund reports total assets of over $350 billion; China’s fund and Singapore’s two funds each manage assets of at least $100 billion. This places sovereign wealth funds among the largest investment funds worldwide. However, while the estimated $2 to $3 trillion sovereign wealth funds manage exceeds the $1.4 trillion managed by hedge funds, it is much less than the over $15 trillion managed by pension funds, the $16 trillion managed by insurance companies, or the $21 trillion managed by investment companies.1 It is an even smaller fraction of global debt and equity securities, which exceed $100 trillion.”

“Since August 2007, U.S. banking organizations have raised approximately $100 billion in new capital (Citigroup (C), Merrill Lynch (MER), Bear Sterns (BSC), Wachovia (WB) and others). During this period, sovereign wealth funds have been an important source of capital for U.S. financial institutions. Sovereign wealth funds made direct investments totaling more than $30 billion in U.S. financial firms, including approximately $17 billion in commercial banking organizations. “

“Sovereign wealth funds, like private investment funds, U.S. state investment vehicles, hedge funds, private equity firms, and many other investors, have generally made investments at levels that are not large enough to trigger the thresholds for review and approval by the federal banking agencies under the federal banking laws. If a sovereign wealth fund were to make an investment in a U.S. banking organization that triggers one of these thresholds, the application would be evaluated by the Federal Reserve or other appropriate federal banking agency under the relevant statutes with no preference or handicap relative to other investors. Any sovereign wealth fund controlling a U.S. bank or bank holding company would be required to operate subject to the limitations on affiliate transactions in sections 23A and 23B of the Federal Reserve Act and the bank or bank holding company would be subject to the full range of regulatory and supervisory tools available to the Board.”

Read whole text here:

Short explanation? While a growing entity, their actual power is dwarfed by existing institutions. When you also consider the percentage of ownership is small, their actual ability to effect meaningful change or assert influence in the institutions they take stakes in has to be questioned. Especially if that attempt runs contrary to investors wished.

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Thursday’s Links

Post author By ToddSullivan
Post date April 24, 2008

Video, Lending, McDonald’s, iwhatever

– The future of video in your home…

– Am I the only one who is thinking, “What took so long”?

– This is no longer news, when they miss, let me know.

– If I never hear the phrase “i” something again it will be too soon.

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Thursday's Links

Post author By ToddSullivan
Post date April 24, 2008

Video, Lending, McDonald’s, iwhatever

– The future of video in your home…

– Am I the only one who is thinking, “What took so long”?

– This is no longer news, when they miss, let me know.

– If I never hear the phrase “i” something again it will be too soon.

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Dow Chemical (DOW) Beats

Post author By ToddSullivan
Post date April 24, 2008

Two words, great management. Despite input costs rising 42% and the N. American slowdown, Dow delivered EPS of $.99 vs $1.00 last year beating the $.94 a share estimates.

Dow reported sales of $14.8 billion for the first quarter of 2008, 19& higher than in the same period last year, another quarterly sales record (beat last quarter). Net income was $941 million compared to $973 million in Q1 of 2007.

Equity earnings for the quarter were $274 million, marking the fifth consecutive quarter in which equity earnings exceeded $250 million. The importance of the equity portion is paramount as the percentage of profits derived from them is only going to increase in the future.

Another key sector, Agricultural Sciences, posted record sales of $1.3 billion, 27% higher than the same period last year and EBIT was $331 million, compared with $282 million in the year ago period (another record). Recent acquisitions of Agromen, MTI and Duo Maize performed well, and the integration of recently acquired Triumph Seeds is proceeding nicely.

“Dow delivered an exceptionally good quarter, in which broad-based pricing initiatives, growth in our Performance businesses, especially Dow AgroSciences, and our strong international presence counterbalanced ongoing weakness in the United States, and an unprecedented increase in purchased feedstock and energy costs,” said Andrew N. Liveris, Dow’s chairman and chief executive officer. “Add in consistently robust contributions from joint ventures, and you can see all elements of our strategy at work, as we continue our transformation to an earnings-growth company.”

Earnings call later today, will update then

Disclosure (“none” means no position):Long DOW

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