Thank-you, Cells vs. Land Lines, DOW, Homebuilders
– Thank you for the mention
– Actually considering getting rid of ours…
– 4% yield
– This is a good sign…
Categories
Categories
Tiuesday's Upgrades and Downgrades
Upgrades
beriaBank (IBKC)- Janney Mntgmy Scott Neutral » Buy
Echostar Holdings (SATS)- Stifel Nicolaus Hold » Buy
Union Pacific (UNP)- Stifel Nicolaus Hold » Buy
Trailer Bridge, Inc. (TRBR)- Stifel Nicolaus Hold » Buy
Anglo American (AAUK)- Citigroup Hold » Buy
Yahoo! (YHOO)- Needham Hold » Buy
Jetblue Airways (JBLU)- JP Morgan Underweight » Neutral
Alaska Air (ALK)- JP Morgan Underweight » Neutral
Equity Res (EQR)- RBC Capital Mkts Underperform » Sector Perform
Ariba (ARBA)- RBC Capital Mkts Sector Perform » Outperform
Monaco Coach (MNC)- RBC Capital Mkts Underperform » Sector Perform
Teekay Offshore (TOO)- Wachovia Mkt Perform » Outperform
Opnext (OPXT)- JP Morgan Underweight » Neutral
British Sky Brdcst (BSY)- Deutsche Securities Hold » Buy
Oplink Comms (OPLK)- Merriman Curhan Ford Neutral » Buy
National City (NCC)- Citigroup Hold » Buy
Texas Instruments (TXN)- Citigroup Hold » Buy
ScanSource (SCSC)- Robert W. Baird Neutral » Outperform
Compuware (CPWR)- Banc of America Sec Neutral » Buy
Downgrades
beriaBank (IBKC)- Janney Mntgmy Scott Neutral » Buy
Echostar Holdings (SATS)- Stifel Nicolaus Hold » Buy
Union Pacific (UNP)- Stifel Nicolaus Hold » Buy
Trailer Bridge, Inc. (TRBR)- Stifel Nicolaus Hold » Buy
Anglo American (AAUK)- Citigroup Hold » Buy
Yahoo! (YHOO)- Needham Hold » Buy
Jetblue Airways (JBLU)- JP Morgan Underweight » Neutral
Alaska Air (ALK)- JP Morgan Underweight » Neutral
Equity Res (EQR)- RBC Capital Mkts Underperform » Sector Perform
Ariba (ARBA)- RBC Capital Mkts Sector Perform » Outperform
Monaco Coach (MNC)- RBC Capital Mkts Underperform » Sector Perform
Teekay Offshore (TOO)- Wachovia Mkt Perform » Outperform
Opnext (OPXT)- JP Morgan Underweight » Neutral
British Sky Brdcst (BSY)- Deutsche Securities Hold » Buy
Oplink Comms (OPLK)- Merriman Curhan Ford Neutral » Buy
National City (NCC)- Citigroup Hold » Buy
Texas Instruments (TXN)- Citigroup Hold » Buy
ScanSource (SCSC)- Robert W. Baird Neutral » Outperform
Compuware (CPWR)- Banc of America Sec Neutral » Buy
Categories
Tiuesday’s Upgrades and Downgrades
Upgrades
beriaBank (IBKC)- Janney Mntgmy Scott Neutral » Buy
Echostar Holdings (SATS)- Stifel Nicolaus Hold » Buy
Union Pacific (UNP)- Stifel Nicolaus Hold » Buy
Trailer Bridge, Inc. (TRBR)- Stifel Nicolaus Hold » Buy
Anglo American (AAUK)- Citigroup Hold » Buy
Yahoo! (YHOO)- Needham Hold » Buy
Jetblue Airways (JBLU)- JP Morgan Underweight » Neutral
Alaska Air (ALK)- JP Morgan Underweight » Neutral
Equity Res (EQR)- RBC Capital Mkts Underperform » Sector Perform
Ariba (ARBA)- RBC Capital Mkts Sector Perform » Outperform
Monaco Coach (MNC)- RBC Capital Mkts Underperform » Sector Perform
Teekay Offshore (TOO)- Wachovia Mkt Perform » Outperform
Opnext (OPXT)- JP Morgan Underweight » Neutral
British Sky Brdcst (BSY)- Deutsche Securities Hold » Buy
Oplink Comms (OPLK)- Merriman Curhan Ford Neutral » Buy
National City (NCC)- Citigroup Hold » Buy
Texas Instruments (TXN)- Citigroup Hold » Buy
ScanSource (SCSC)- Robert W. Baird Neutral » Outperform
Compuware (CPWR)- Banc of America Sec Neutral » Buy
Downgrades
beriaBank (IBKC)- Janney Mntgmy Scott Neutral » Buy
Echostar Holdings (SATS)- Stifel Nicolaus Hold » Buy
Union Pacific (UNP)- Stifel Nicolaus Hold » Buy
Trailer Bridge, Inc. (TRBR)- Stifel Nicolaus Hold » Buy
Anglo American (AAUK)- Citigroup Hold » Buy
Yahoo! (YHOO)- Needham Hold » Buy
Jetblue Airways (JBLU)- JP Morgan Underweight » Neutral
Alaska Air (ALK)- JP Morgan Underweight » Neutral
Equity Res (EQR)- RBC Capital Mkts Underperform » Sector Perform
Ariba (ARBA)- RBC Capital Mkts Sector Perform » Outperform
Monaco Coach (MNC)- RBC Capital Mkts Underperform » Sector Perform
Teekay Offshore (TOO)- Wachovia Mkt Perform » Outperform
Opnext (OPXT)- JP Morgan Underweight » Neutral
British Sky Brdcst (BSY)- Deutsche Securities Hold » Buy
Oplink Comms (OPLK)- Merriman Curhan Ford Neutral » Buy
National City (NCC)- Citigroup Hold » Buy
Texas Instruments (TXN)- Citigroup Hold » Buy
ScanSource (SCSC)- Robert W. Baird Neutral » Outperform
Compuware (CPWR)- Banc of America Sec Neutral » Buy
Categories
"Fast Money" for Tuesday
Tuesday’s Picks
Guy Adami suggests getting long Boeing (BA) $87.07
Pete Najarian thinks DuPont (DD) $49.5 is a buy.
Jeff Macke recommends shorting Electronic Arts (ERTS) $48.43
Karen Finerman likes shorting the British pound with the CurrencyShares British Pound Ster. Trust (FXB) $195.31
Monday’s Results
Pete Najarian likes Pride Int’l (PDE) $45.95 Close $46.14 GAIN
Karen Finerman recommends Golan (GLNG) $20.26 Close $21 GAIN
Guy Adami suggest Citigroup (C) $23.12 Close $22.99 GAIN
Jeff Mack thinks Microsoft (MSFT) $29.99 is a buy.Close $29.46 LOSS
2008 Records:
Brian Schaeffer= 0-1
Carter Worth= 1-1
Jon Najarian= 4-3
Jeff Macke= 39-31-1
Tim Seymore= 17-14
Guy Adami= 40-34
Pete Najarian= 38-33
Karen Finerman= 35-29-1
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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A recent article by Sears Holdings (SHLD) Chairman Eddie Lampert gives some insight into recent buying activity.
The article, entitled "The Best Advice I Ever Got" said:
"Almost every weekend when I was 7, 8, 9, 10 years old, my father and I would toss a football in the yard or play basketball in the driveway. When we played football, he'd say, "Go out ten steps. Turn to your right." The ball would reach me just before I turned, and it would hit me right in the chest. Why would my dad do this? He told me, "If I waited for you to turn, you and the defensive player would have an equal chance to get the ball. Your opportunity is gone."
This idea of anticipation is key to investing and to business generally. You can't wait for an opportunity to become obvious. You have to think, "Here's what other people and companies have done under certain circumstances. Now, under these new circumstances, how is this management likely to behave?" The plays my father designed for me helped me learn to think ahead. Lots of days I asked him, "Why can't we just invite kids over and play a game?" In order to do something well, he explained, you have to keep practicing and preparing."
My guess is that when one looks at Lampert's recent buying spree in shares of AutoNation (AN), the above statements are the genesis. For instance, Lampert has held shares in the company since the turn of the century and is extremely familiar with it and its machinations.
That being said, while other investors are fleeing the retail auto sector Lampert has been buying about a million shares every other week for the past few months. Why?
Perhaps he sees that CEO Mike Jackson has expanded the retailer's dealership pipeline with Mercedes and BMW (BMW) dealerships, more resistant to economic downturns and much more profitable in good times than your run of the mill Ford (F) or GM (GM) one.
Perhaps he sees, that looking ahead leases on vehicles still expire requiring the leasee to either lease or buy another one and that the current stock price reflects the poor environment now, but now the upcoming surge in activity down the road?
Perhaps he knows that while credit is tight now, all that does is to suppress demand, not eliminate it. He knows the demand (desire) for a new vehicle does not "go away". The desire to get rid of an old car for a new one stays and when credit does loosen a bit, the spigot will open and the pent-up demand becomes a flood of buyers.
Also, he knows CEO Jackson manages the business for the long term. During the sluggish auto environment in 2001, many dealers responded to deteriorating demand by offering 0% loans which after even small credit losses meant the loan portfolios eventually lost money. Jackson said at the time he did not see the reasoning for "losing money on loans just to move metal". Shares tripled from then levels.
It is clear that Warren Buffett from Berkshire (BRK.a) sees it as he has purchased shares of CarMax (KMX) another auto retailer. The boys over at Leucadia (LUK) also see it with their 30% investment in auto finance company AmeriCredit (ACF) along with Bruce Berkowitz and Bill Miller who have also taken stakes in ACF.
Disclosure ("none" means no position):Long SHLD, None
Categories
Lowe's Profit Drop: Not All That Bad
If I am being honest, I would have thought this number would have been much worse…
Lowe’s (LOW), #2 behind Home Depot (HD) reported quarterly earnings came to $607 million, or 41 cents a diluted share, compared with $739 million, or 48 cents a share, a year earlier, a 14% decrease. Net sales dipped 1.3% to $12 billion, with same-store sales falling 8.4%.
In February, Lowe’s projected earnings of 38 cents to 42 cents a share, 2% revenue growth and same-store sales down 5% to 7%.
“The challenging sales environment we have been experiencing for the past six quarters continued into the first quarter of 2008, and increasing financial pressures on consumers resulted in top-line sales that fell below our plan,” commented Robert A. Niblock, Lowe’s chairman and CEO. “The generally poor economic outlook, including well-known housing pressures, rising food and fuel prices and a more negative employment picture eroded consumer confidence and impacted discretionary purchases for the home.”
Now, I do not think anyone expected good results. These are poor but, here is the key:
“With our offering of great products and exceptional service, Lowe’s continued to gain market share in the quarter, and diligent expense control helped us achieve respectable earnings in spite of the headwinds facing the industry,” Niblock said
“Continuing to gain market share”. See, housing will eventually turn and Lowe’s is positioning itself through superior service and sensible balance sheet management to be ready to capitalize when it happens. Results will begin to look “less bad” as easier comps begin to come around this summer and into the fall and we will begin to get more of an apples to apples comparison for earnings based on housing levels.
Lowe’s is getting a larger piece of a smaller pie. When that pie expands (it will), their piece will grow in excess of Home Depot’s who inexplicably is still struggling with service issues and the hangover of promises made and not kept.
I have posted on Lowe’s a few times as to it’s attractiveness. It continues to be the one I would choose in the category.
Here are Q2’s expectations:
Second Quarter 2008 (comparisons to second quarter 2007)
— The company expects to open approximately 23 new stores reflecting
square footage growth of approximately 11 percent
— Total sales are expected to increase approximately 1 percent
— The company expects comparable store sales to decline 6 to 8 percent
— Earnings before interest and taxes (EBIT) margin is expected to decline
approximately 190 basis points driven by payroll, fixed costs,
depreciation and gross margin
— Store opening costs are expected to be approximately $22 million
— Diluted earnings per share of $0.54 to $0.59 are expected
— Lowe’s second quarter ends on August 1, 2008 with operating results to
be publicly released on Monday, August 18, 2008
I will let this quarter play out before making a decision. Should they hit the goals, I probably will be a buyer.
Disclosure (“none” means no position):None
Categories
Lowe’s Profit Drop: Not All That Bad
If I am being honest, I would have thought this number would have been much worse…
Lowe’s (LOW), #2 behind Home Depot (HD) reported quarterly earnings came to $607 million, or 41 cents a diluted share, compared with $739 million, or 48 cents a share, a year earlier, a 14% decrease. Net sales dipped 1.3% to $12 billion, with same-store sales falling 8.4%.
In February, Lowe’s projected earnings of 38 cents to 42 cents a share, 2% revenue growth and same-store sales down 5% to 7%.
“The challenging sales environment we have been experiencing for the past six quarters continued into the first quarter of 2008, and increasing financial pressures on consumers resulted in top-line sales that fell below our plan,” commented Robert A. Niblock, Lowe’s chairman and CEO. “The generally poor economic outlook, including well-known housing pressures, rising food and fuel prices and a more negative employment picture eroded consumer confidence and impacted discretionary purchases for the home.”
Now, I do not think anyone expected good results. These are poor but, here is the key:
“With our offering of great products and exceptional service, Lowe’s continued to gain market share in the quarter, and diligent expense control helped us achieve respectable earnings in spite of the headwinds facing the industry,” Niblock said
“Continuing to gain market share”. See, housing will eventually turn and Lowe’s is positioning itself through superior service and sensible balance sheet management to be ready to capitalize when it happens. Results will begin to look “less bad” as easier comps begin to come around this summer and into the fall and we will begin to get more of an apples to apples comparison for earnings based on housing levels.
Lowe’s is getting a larger piece of a smaller pie. When that pie expands (it will), their piece will grow in excess of Home Depot’s who inexplicably is still struggling with service issues and the hangover of promises made and not kept.
I have posted on Lowe’s a few times as to it’s attractiveness. It continues to be the one I would choose in the category.
Here are Q2’s expectations:
Second Quarter 2008 (comparisons to second quarter 2007)
— The company expects to open approximately 23 new stores reflecting
square footage growth of approximately 11 percent
— Total sales are expected to increase approximately 1 percent
— The company expects comparable store sales to decline 6 to 8 percent
— Earnings before interest and taxes (EBIT) margin is expected to decline
approximately 190 basis points driven by payroll, fixed costs,
depreciation and gross margin
— Store opening costs are expected to be approximately $22 million
— Diluted earnings per share of $0.54 to $0.59 are expected
— Lowe’s second quarter ends on August 1, 2008 with operating results to
be publicly released on Monday, August 18, 2008
I will let this quarter play out before making a decision. Should they hit the goals, I probably will be a buyer.
Disclosure (“none” means no position):None
Categories
Monday's Links
Boston Herald, Nudity, Adam, Soros
– The first front page apology I have ever seen……call it fellatio?
– How can you lose money selling naked boobs?
– Adam nails it on this one
– I can’t stand the guy but he is self made so it bears listening to him…
Categories
Monday’s Links
Boston Herald, Nudity, Adam, Soros
– The first front page apology I have ever seen……call it fellatio?
– How can you lose money selling naked boobs?
– Adam nails it on this one
– I can’t stand the guy but he is self made so it bears listening to him…
A simple yet very common sense way for Harley Davidson (HOG) to attract new younger riders to the fold.
There have been a bunch of comments on blogs post about the “age and demographics” of Harley riders. The common refrain is that they are “55 year old guys” and that this is a reason that sales will eventually decline. It is not by the way, it is more like 47.
Other Demographic Facts:
52%—Owned a Harley-Davidson motorcycle previously at any point during lifetime
33%—Owned a competitive motorcycle previously
15%—First motorcycle purchased
I never get this argument because someone is always turning 55 unless there is a new law I am unaware of and the HOG is more prevalent on the road now than it ever was. Anyway, let’s go with it for arguments sake. What Harley would then have to do is try to appeal to a younger crowd, no? Turns out they are doing just that.
Harley Davidson is the only motorcycle manufacturer that offers a branded rider education program. It is currently active in 42 states through its authorized dealerships. Called the “Rider’s Edge New Rider Course“, it is a Motorcycle Safety Foundation certified program. The program includes both classroom instruction and training on a controlled range. Students learn how to ride on a Buell Blast, the lightweight, easy-to-handle “Sport Bike” with a rider-friendly design. Harley-Davidson dealerships across the country offer the Rider’s Edge Skilled Rider Course for motorcycle enthusiasts interested in taking their riding to the next level.
“Rider’s Edge” has trained in excess of 138,000 students with 39% of them being women. A survey in late 2003 showed that 84 percent of students get their licenses after completing the course.
Upon successful completion of the course, students receive an Motorcycle Safety Foundation Completion Card which, depending on their state of residence and insurance provider may et them a discount on insurance
Disclosure (“none” means no position):Long HOG
Categories
"Fast Money" for Monday
Monday’s Picks
Pete Najarian likes Pride Int’l (PDE) $45.95
Karen Finerman recommends Golan (GLNG) $20.26
Guy Adami suggest Citigroup (C) $23.12
Jeff Mack thinks Microsoft (MSFT) $29.99 is a buy.
Friday’s Results
Guy Adami likes Citigroup (C) $23.73 Close $23.12 LOSS
Tim Seymour recommends NII Holdings (NIHD) $50.66 for consolidation in wireless. Close $50.53 LOSS
Pete Najarian prefers Sasol (SSL) $65.11 for mining.Close $65.94 GAIN
Jeff Macke recommends shorting the Dow with Short Dow30 ProShares (DOG) $59.80. Close $59.86 Gain
2008 Records:
Brian Schaeffer= 0-1
Carter Worth= 1-1
Jon Najarian= 4-3
Jeff Macke= 39-30-1
Tim Seymore= 17-14
Guy Adami= 39-34
Pete Najarian= 37-33
Karen Finerman= 34-29-1
Joe Terrenova= 1-1
2007 Results (Since 6/21):
Guy Adami= 58-46 = 56%
Jeff Macke= 60-40 = 60%
Pete Najarian= 49-41 = 54%
Categories
Icahn on Texaco / Getty Lawsuit
Another funny story about Texaco
Categories
Icahn Does Stand-Up
This is a funny story about his attempted US Steel (X) takeover
Disclosure (“none” means no position):None
so famed investor Nelson Peltx has taken a just over 1% stake in Starbucks (SBUX). At least there is finally someone there who makes the stock (and company) interesting..
Recently, the billionaire has bought large stakes in Wendy’s (WEN), Kraft (KFT) and H.J. Heinz (HNZ) through his hedge fund. Peltz then pressured management to make changes aimed at improving profit margins and lifting stock prices. Typically Peltz pressures the companies to focus on the core of their businesses and divest sell off less-profitable endeavors.
Based on that alone one can expect the “Entertainment” division of Starbucks to be first on the chopping block. Rather than producing albums and books, let just get the coffee thing going in the right direction.
Starbucks is coming off a Q2 that saw net income fall 28% and its same store sales at U.S. locations fall by their widest margin ever. Management is going to have a real hard time dismissing any ideas Peltz puts forward based on both their current track records lately.
This is really good for shareholders. If nothing else, Peltz will remind them of what the chain really is supposed to be, a coffee house. Not a book and record producer. Not a coffee machine retailer. Not a baker and so forth. Just do coffee and do it very well and people will return.
Here is another idea. Why not franchise? Really, why? It may be a bizarre control things in Seattle but it works just fantastically for every other multi-location food retailer (yes, that is what you are). Franchise fees alone would add to the bottom line while reducing costs, freeing up money (not for expansion) but for buying back shares or actually giving shareholders a dividend. They deserve something after the last 18 months. Hell, put 10% to 20% of the US stores up for sale to “master franchisees” and watch the offers come pouring in.
It would work…..if they will just listen out there which, unfortunately, is not a given..
Disclosure (“none” means no position):None
Categories
Borders (BGP) to Sell Paperchase
Looking for a price tag of about $80 million, borders (BGP) has put the UK Paperchase stationary retailer up for sale.
Paperchase has more than 100 stores and concessions, including ones in House of Fraser and Selfridges department stores in the UK. Recently, (2005) is has begun opening concessions in US Borders stores.
Reports are that Goldman Sachs (GS) has been hired to conduct a review that ought to lead to a sale.
I am not sure this is the best thing long term for Borders but, given the current retail environment, it is a necessary step to pay down some debt, restore more liquidity and let’s be honest, make it more attractive to a buyer.
Disclosure (“none” means no position):Long BGP