Category: Articles

Bill Miller, Better than Google and Apple?, US Dollar, Bloggers vs Congress

– Another “buy” for financials

– This is a very interesting take on what could be next years tech stars.

– Want to invest in currencies? Here is an easy way.

– Americans now trust bloggers more than they do Congress

–

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Andy Serwer and Barney Gimbel at Fortune got an interview with Citigroup’s (C) largest individual shareholder Prince Alwaleed who holds 3.6% of the $150 billion dollar company.

Some excerpts:

Why he withdrew his support for CEO Chuck Prince:

“You cannot come to the public and say that this normalization is expected in the fourth quarter and then three weeks later, not three months later, you come and say there is an $11 billion writeoff. This is unacceptable. That’s when the events changed completely. My backing was withdrawn dramatically. You should never commit to something that you can’t deliver. Never.”

Is he supporting Sandy Weill for CEO?

“No, no, Sandy is not seeking to be president. What Sandy likes to do is to be involved in the process of selecting a new boss. Sandy told me, “I have no aspirations whatsoever to be CEO or chairman.”

However, he would like to be involved in the process of selecting the boss for Citi because Citi can’t afford to have another loss. The situation right now is unacceptable for a bank like Citi with $2.5 trillion in assets and $120 billion of equity, and is in more than 100 countries. It’s a pity for Citibank to be in this position. It’s not right. We can’t afford to have another blunder like that. “

Who should the next CEO be?

“Frankly speaking, I don’t have anybody in mind. I trust Mr. Rubin. I trust Mr. Bischoff. I trust Mr. Parsons. The selection process has to be very careful and they should take their time finding the right guy. My recommendation and advice for them is they don’t hire anyone unless this guy has expertise in banking. I told them, next time no lawyer, please.”

Is he selling?

“I will sell nothing. We are selling nothing. I want to make it clear that I fully support the leadership of Citigroup and think it is a very strong company with a good future.

You remember something very important, that the average [price at which] I bought Citibank was $2.75 per share adjusted for stock splits. That’s my average. But still Citibank does not deserve to be where it is right now. It is a pity what is happening, but I hope that a big lesson is learned in the board of directors and the management of Citibank. “

Is a deal in the works?

“It is not time for that right now, for sure. I am against it now. Not at this price, for sure. It would not be fair for the shareholders of Citibank at all. I mean even after the stock went down, Citibank is still worth $160 billion. It’s still a force to be reckoned with. I mean, how many companies in the world can withstand a writeoff of $6 billion and another writeoff of $8 to $11 billion three weeks later, and still stand on its own feet? Not many”

Read the whole interview here:

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UPGRADES
First Solar FSLR Merriman Curhan Ford Sell » Neutral
Cooper Tire CTB KeyBanc Capital Mkts Buy » Aggressive Buy
Maguire Properties MPG Stifel Nicolaus Sell » Buy
Enterprise GP Holdings EPE Wachovia Mkt Perform » Outperform
Tyson Foods TSN Wachovia Underperform » Mkt Perform
WebMD Health WBMD Needham & Co Hold » Buy
Greenfield Online SRVY Needham & Co Buy » Strong Buy
China Grentech GRRF Susquehanna Financial Neutral » Positive
Nortel NT Credit Suisse Underperform » Neutral
Middlesex Water MSEX Boenning & Scattergood Market Perform » Market Outperform
Sun Healthcare SUNH Bear Stearns Peer Perform » Outperform
NetLogic NETL CIBC Wrld Mkts Sector Perform » Sector Outperform
Foster Wheeler FWLT Citigroup Hold » Buy
Ashland ASH Credit Suisse Underperform » Neutral
Stantec SXC Brean Murray Hold » Buy
HLTH Corp HLTH Friedman Billings Mkt Perform » Outperform
First Solar FSLR CIBC Wrld Mkts Sector Perform » Sector Outperform
Ship Finance Intl SFL Citigroup Sell » Buy
Town Sports Intl CLUB Banc of America Sec Sell » Neutral
Eaton ETN Bernstein Mkt Perform » Outperform
Total S.A. TOT JP Morgan Neutral » Overweight
FirstMerit Corp FMER Lehman Brothers Underweight » Equal-weight
Coeur d’Alene Mines CDE JP Morgan Neutral » Overweight
Somaxon Pharma SOMX JP Morgan Underweight » Neutral
PG&E PCG Jefferies & Co Hold » Buy

DOWNGRADES
Nastech Pharm NSTK BMO Capital Markets Outperform » Market Perform
Goldman Sachs GS Wachovia Outperform » Mkt Perform
Sotheby’s BID Banc of America Sec Buy » Neutral
Kinross Gold KGC CIBC Wrld Mkts Sector Outperform » Sector Perform
Kenexa KNXA CIBC Wrld Mkts Sector Outperform » Sector Perform
Kenexa KNXA Brean Murray Buy » Hold
Quebecor World IQW CIBC Wrld Mkts Sector Outperform » Sector Perform
Quebecor World IQW UBS Buy » Neutral
McCormick & Schmick’s MSSR Morgan Joseph Buy » Hold
Bankrate RATE RBC Capital Mkts Outperform » Sector Perform
Baidu.com BIDU RBC Capital Mkts Outperform » Sector Perform
Sotheby’s BID JMP Securities Mkt Outperform » Mkt Perform
Hologic HOLX RBC Capital Mkts Outperform » Sector Perform
InnerWorkings INWK Jefferies & Co Buy » Hold
Kinross Gold KGC Credit Suisse Outperform » Neutral
ING Groep ING Bear Stearns Outperform » Peer Perform
Global Cash Access GCA JP Morgan Overweight » Neutral
Maidenform Brands MFB Brean Murray Buy » Hold
Kenexa KNXA Susquehanna Financial Neutral » Negative
Primus Guaranty PRS Lehman Brothers Overweight » Underweight
AMR Corp AMR UBS Neutral » Sell
Air Tran Holdings AAI UBS Buy » Neutral
Nice Systems NICE Banc of America Sec Buy » Neutral
Bankrate RATE CIBC Wrld Mkts Sector Perform » Sector Underperform
Brown-Forman BF.A JP Morgan Overweight » Neutral
Gol Intelligent Airlines GOL Deutsche Securities Buy » Hold

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Friday’s Picks

Tim Seymour recommended Alcoa (AA).Open $37.66

For the second day in a row Guy Adami said Short Dow30 ProShares(DOG) was a buy. Open $59.95

Karen Finerman liked Watts Water Technologies (WTS).Open $27.80

Pete Najarian preferred Boston Scientific (BSX). Open $12.49

Thursday’s Results

Tim Seymour liked Gold Fields (GFI). Open $18.10 Close $18.93 GAIN

Guy Adami recommended shorting the Dow with Short Dow30 ProShares (DOG). Open $59.46 Close $59.95 GAIN

Karen Finerman liked her financials trade; long Goldman (GS) Open $214.18 Close $209.01 LOSS and short Lehman (LEH). Open $55.96 Close $56.11 LOSS

Pete Najarian liked Evergreen Solar (ESLR). Open $13.65 Close $15.99 GAIN

Since my tracking began on 6/21 (1-1 means one up pick and one down pick and no results from my vacation weeks). The percentage is the percentage of successful picks

Guy Adami= 43-25 = 64%
John Najarian= 13-4 = 76%
Jeff Macke= 47-33 = 58%
Pete Najarian= 31-30 = 51%
Tim Seymore= 5-3 = 62%
Karen Finerman= 26-16 = 61%
Stacey Briere-Gilbert= 3-0 = 100
Ned Riley= 1-0 = 100%
Carter Worth= 0-1 = 0%

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Lost in the commentary in yesterday’s earnings release from Wal-Mart (WMT) was the fantastic international results.

At international stores, net sales rose 19.2% to $7.19 billion. In October, the company’s operations in the United Kingdom, Brazil and China continued their recent positive performance. Sales throughout Brazil continue to be driven by a stronger price position, in-stock improvement and a recovery of disposable income.

Total company sales for the month rose 8.4% to $27.92 billion. At Wal-Mart stores, same-store sales were flat, while net sales rose 5% to $17.44 billion. Same-store sales at Sam’s Club warehouse stores rose 2.7%, boosted by strengths in fresh food, grocery, video games and office supplies. Sam’s Club net sales rose 5.3% to $3.3 billion.

What will be very interesting is too see how the “Black Friday” after Halloween will affect November sales. Initial reports are that is was a large success both online and in the stores. As the consumer feels pinched (assuming they do) Wal-Mart will benefit from this.

Now, if Lee Scott & Co. is looking at the same reports I am, I have to hope they are plowing money into both the overseas operations and stock buybacks. That is where they are going to realize the best value for the money spent.

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Apple monopoly?, Bloggystyle, Cuomo, WaMu

– Interesting

– Here is Adam’s aggregation

– Just what we need, another dipshit AG trying to make a name for himself screwing things up.

– Buy the financials…

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Some highlights from Bernanke’s testimony to congress today.

“Although the problems with subprime mortgages initiated the financial turmoil, credit concerns quickly spilled over into a number of other areas. Importantly, the secondary market for securities backed by prime jumbo mortgages also contracted, and the issuance of such securities has declined significantly. Prime jumbo loans are still being made to prospective home purchasers, but they are at higher spreads and have more-restrictive terms. Concerns about mortgage-backed securities and structured credit products (even those unrelated to mortgages) also greatly reduced investor appetite for asset-backed commercial paper, although that market has improved somewhat recently. In the area of business credit, investors shied away from financing leveraged buyouts and from purchasing speculative-grade corporate bonds. And some larger banks, concerned about potentially large and difficult-to-predict draws on their liquidity and balance sheet capacity, became less willing to provide funding to their customers or to each other.

To be sure, the recent developments may well lead to a healthier financial system in the medium to long term: Increased investor scrutiny of structured credit products is likely to lead ultimately to greater transparency in these products and to better differentiation among assets of varying quality. Investors have also become more cautious and are demanding greater compensation for bearing risk. In the short term, however, these events do imply a greater measure of financial restraint on economic growth as credit becomes more expensive and difficult to obtain.”

Going forward:

“In the days since the October FOMC meeting, the few data releases that have become available have continued to suggest that the overall economy remained resilient in recent months. However, financial market volatility and strains have persisted. Incoming information on the performance of mortgage-related assets has intensified investors’ concerns about credit market developments and the implications of the downturn in the housing market for economic growth. In addition, further sharp increases in crude oil prices have put renewed upward pressure on inflation and may impose further restraint on economic activity. The FOMC will continue to carefully assess the implications for the outlook of the incoming economic data and financial market developments and will act as needed to foster price stability and sustainable economic growth.”

In short, the economy is good, credit is tight, financials will be fine, long term this is good, oil sucks. Will oil seep into the system? To date it has had a limited effect on the consumer. This does bear close watching though.

Whole testimony here:

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I had no idea YouTube was an investor’s information site also. Tilson talks about Wal-Mart (WMT).

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Tilson is someone whose opinions are worth listening to. He speaks to the Citigroup’s (C) Chairman’s “tarnished” reputation.

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There was an interesting disclosure in Archer Daniels Midland’s (ADM) conference call. CEO Patricia Woertz addressed two important issues.

Ann Gurkin – Davenport

“Just wanted to spend a little time on getting an update on your work and, besides ethanol, other renewable fuels, switch grass. Maybe are you closer to doing anything in sugar in South America, Can we just get an update there?”

Pat Woertz

“Sure. We’ve talked about diversifying our feedstocks, which would include more palm, sugar, potential biomass to be run not only for first but sort of second-generation biofuels. Mike Pacheco, who is our new Chief Technology Officer, spent a little bit of time in about five slides or so, which you might want to look up on our website, but talked a little bit about.

So to speak, first of all our advantage in the dry mill ethanol world, which, of course, we’re completing two plants adjacent to our wet mills facility. But then kind of spent time on the nearer term focus on commercializing technology, again in a wide range; food, feed, industrial bioproducts and then biofuels.

And when it comes to the biofuels piece, we kind of walked through the spectrum of not only technology conversion, but also feedstocks and also end products, and are attempting at this point.

And I would say by February of next year, we will have a very limited list, or a very highly focus list, I should say, of the kind of opportunities for both conversion feedstock and end products.

A good example is our ConocoPhillips project that we announced, which is looking at biomass to biocrude, so this would be a type of crude oil that could be run in the traditional refineries yet made from biomass at very cost effective prices.

So that’s an example something where we actually have that one up and running. There’s a couple of other collaborative researches we’ve announced, one with the Colorado Consortium, one with Purdue University, et cetera.

So a lot going on but more clarification and I would say fine-tuning of that by early next year.”

Ken Zaslow – BMO Capital Markets

“Would you think about buying ethanol assets rather than building and at what price? And how do you think about it, just because it seems like a lot of these capacity buildups are slowing down a little bit and it seems like there may be opportunity to come in and buy some assets a little bit cheaper than maybe build it?”

Pat Woertz

“Yes, I’ll take that one, Ken. We’re actively engaged in this market all the time, and we know where every plant location is. We kind of have a sense of what locations might be interesting to us. But it would have to be a real value and scale and fit with our network, but it’s not to say we aren’t looking and aware.”

ADM is clearly on the hunt both for acquisition and JV’s to expand its businesses in biofuels. The beginning of next year will be very exciting as Woertz plans to make additional announcements. the best part is they are doing it in a very disciplined manner and not running around buying everything in sight. This is good because ethanol assets will be on the market and a disciplined buyer will be able to take great advantage of the situation.

Aside from that investors ought to mark their calenders for February, something is coming…

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