Jan 22, 2010

Daily Markets - Financial News & Opinions

Daily Markets - Financial News & Opinions

SunTrust Reports Narrower Losses

Posted: 22 Jan 2010 11:03 AM PST

SunTrust Bank Inc.'s (STI) fourth quarter operating loss of 64 cents per share was lower than the Zacks Consensus Estimate of a loss of 75 cents. Last year, the company reported a loss of $1.07 per share. Net loss was $316.4 million versus $374.9 million last year.
Results continued to be affected by recessionary pressures as evidenced by soft revenue and weak loan demand from both consumer and commercial borrowers. SunTrust reported a full-year operating loss of $3.98 per share, compared … [visit site to read more]


How To Empower Shareholders And Improve Corporate Management In Two Easy Steps

Posted: 22 Jan 2010 11:01 AM PST

I wrote last week that Wall Street bonuses should be cut back by the shareholders, not by the government.

Well, a reader wrote back correctly to remind me that the majority of shareholders are institutions that would not want to antagonize major corporations that gave out fund management mandates for their pension funds and 401(k)s by agitating against top management bonuses.

Good point. Very good point. And it highlights a central flaw in today’s capitalism. It’s far too controlled by … [visit site to read more]

Goldman’s Deceptive Profit Growth

Posted: 22 Jan 2010 11:00 AM PST

Say it ain't so! The Dow Jones Industrial Average has slipped into the red for the day, year, decade and century…all in one day!
The Dow tumbled 213 points yesterday, dropping its performance for the New Year (and new decade) into negative territory. This decline also increased the Dow's loss for the century-to-date to about -9%. "Stocks for the long haul" may still be a valid investment strategy, but the haul keeps growing longer.
Please don't misunderstand us; we love stocks. But … [visit site to read more]

Inflation Control: Mission Not Accomplished

Posted: 22 Jan 2010 11:00 AM PST

Central bankers in the United States and Europe have had a primary mission to keep inflation under control. They may have well proclaimed "mission accomplished" with inflation having consistently averaged less than 3 percent in the last 10 years, only to be rudely awakened. Like a doctor judging an athlete by muscle tone and not internal organs or functions, our underlying condition went undetected.
The steroids of credit made consumer prices grow when otherwise buyers would have enjoyed a … [visit site to read more]

Conexant Tops Expectations

Posted: 22 Jan 2010 10:47 AM PST

Conexant (CNXT) recently reported revenues of $61.8 million, up 10% year over year. Gross margin came in at 61%, up from 60.2% in the previous quarter and better than management's expectation of 60%. Operating margin came in at 22%. Earnings per share came in at 17 cents beating the Zacks Consensus Estimate of 10 cents and management's expectations of 11 cents. Conexant ended the quarter with $59.1 million in cash and cash equivalents, compared to $125.4 million in the previous … [visit site to read more]

Update On Transcept’s Intermezzo

Posted: 22 Jan 2010 10:32 AM PST

On January 20, 2010, Transcept (TSPT) management met with the U.S. FDA to discuss the complete response letter issued last October on Intermezzo. The letter brought up issues on potential inadvertent re-dosing in a single night and inadvertent dosing with less than four hours of bedtime remaining. The FDA also requested additional data demonstrating that Intermezzo, when taken as directed in the middle of the night, would not present an unacceptable risk of next-day driving ability (for … [visit site to read more]

Video: JPY Extends Gains Vs. EUR, USD

Posted: 22 Jan 2010 10:20 AM PST

The U.S. dollar traded lower against the EUR, JPY. U.S. equities saw modest losses, as investors remained wary about the Obama administration’s proposals for the U.S. banks. … [visit site to read more]

Western Digital Performs Well

Posted: 22 Jan 2010 10:17 AM PST

Western Digital (WDC) reported second quarter 2010 EPS of $1.85, exceeding the Zacks Consensus Estimate of $1.36.
Revenue
Western Digital reported first quarter 2010 revenue of $2.62 billion, up 43.9% from the prior year and 19.0% on a sequential basis. Revenue from sales of Western Digital branded products was $569.0 million, up 41.0% from the year-ago quarter and up 49.0% sequentially from $382 million in the previous quarter. Demand was strong, with total units coming in at the high end of … [visit site to read more]

Int’l Flavors Initiated As Neutral

Posted: 22 Jan 2010 10:01 AM PST

International Flavors & Fragrances Inc. (IFF), the leading creator and manufacturer of flavor and fragrance compounds, was recently initiated as "Neutral.”
 
The company regularly creates new compounds to meet the changing characteristics and composition of customers' end products. The company's success banks on its ability to innovate according to evolving consumer needs and expectations. This is going to continue in the long term.
 
However, the cyclical nature of the … [visit site to read more]

The Last Shall Be First

Posted: 22 Jan 2010 10:00 AM PST

The yen is falling. It's down 5% against the dollar since November. Investors are finally noticing. With a deficit of 50% of GDP, the Japanese government walks where angels fear to tread. Americans aren't far behind. To make a long story short, our money is on the angels.
Only an economist would dare to look 10 years ahead. Only a fool would put money on it. Today, we do both. But our new "Trade of the Decade," is not so much a look into the future as it is a look at the past.
Ten years … [visit site to read more]

Choosing Dividend Stocks: Six Steps For Finding These Safe, High-Yield Investments

Posted: 22 Jan 2010 09:58 AM PST

Friday, January 22, 2010: Issue #1181
The latest tally from famed professor, Jeremy Siegel – author of the investing classic, Stocks for the Long Run - proves that dividend stocks are still the best investment. Period.
Yet everyone still loves to dog them for being boring and slow growers.
Big mistake.
Let me prove to you just how profitable dividend stocks can be – and then show you how to find the safest, highest-yielding investments in this market.
How a 3.7% Gain Means An Extra … [visit site to read more]

Novartis’ MS Therapy Advances

Posted: 22 Jan 2010 09:57 AM PST

Novartis AG (NVS) recently published full results on its oral multiple sclerosis (MS) therapy FTY720 (fingolimod) in the New England Journal of Medicine. These results were from two pivotal phase III studies, TRANSFORMS and FREEDOMS, which demonstrated that FTY720 reduced the risk of confirmed disability progression.
 
Novartis had initially announced results from these studies in Sep 2009. Combined data from the studies showed significant efficacy in reducing relapses, disability … [visit site to read more]

AMD Beats, Revenue & Profits Leap

Posted: 22 Jan 2010 09:43 AM PST

Advanced Micro Devices (AMD) continued to strengthen in the fourth quarter, with pro forma earnings beating the Zacks Consensus Estimate by 14 cents. Its settlement with Intel Corporation (INTC) added a dollar and 57 cents to GAAP earnings. Revenue exceeded the Zacks consensus by 10.5%.
Revenue
Revenue of $1.65 billion was up 36.6% sequentially and 39.7% year over year, better than management's expectations of a modest sequential increase. Revenue in the last quarter excludes a one-time … [visit site to read more]

To Start Your Day….

Posted: 22 Jan 2010 09:35 AM PST

I am fortunate enough to have a good friend, TL, who sends me his excellently prepared “Morning News Notes” on a daily basis. He has graciously allowed me to reproduce them on the blog, and I hope to include this on a daily basis.

Just click on the link or the coffee mug below.

“Morning News Notes”: January 22, … [visit site to read more]

Forest’s Promising COPD Drug

Posted: 22 Jan 2010 09:26 AM PST

Recently, Forest Laboratories (FRX) and Spain based Almirall announced positive phase III top-line results of Forest's pipeline candidate aclidinium, a multi dose dry-powder inhaler for the treatment of chronic obstructive pulmonary disease (COPD). 

It was observed that aclidinium met its primary end point – it produced statistically significant improvement from the baseline in morning pre-dose (trough) FEV1 versus placebo at week 12. While the drug has been developed by Almirall, … [visit site to read more]

Burlington Northern Exceeds

Posted: 22 Jan 2010 09:11 AM PST

Burlington Northern Santa Fe Corp. (BNI), commonly known as BNSF, reported fourth quarter earnings of $1.30 per share from continuing operations. Results were ahead of the Zacks Consensus Estimate of $1.22. Earnings were down 31.5% from $1.78 per share last year.
Results were dragged down by lower revenues due to volume declines in coal, construction and consumer-related markets caused by the weak economy. A lower fuel surcharge recovery caused by a decline in fuel costs also strained … [visit site to read more]

Consumers Love This Trendy Teen Retailer… And Your Portfolio Will, Too

Posted: 22 Jan 2010 09:04 AM PST

by Jeannette Di Louie, Investment U Research
Friday, January 22, 2010
Investing in retail can be risky these days, unless you invest in clothing retailers, where it's completely insane.
High jobless rates and continuing economic fears have Western consumers edgy. And since they're tightening their belts, last year's pair of slacks will work just fine, thank you very much.
Worse still for the retail sector…

The International Monetary Fund recently warned of a possible double-dip … [visit site to read more]

The U.K. Is Broke, And This Time The U.S. Is Hardly Far Behind

Posted: 22 Jan 2010 09:01 AM PST

Having been among the economic engines of Europe for much of the past decade, it appears as if the British economy has run out of steam. Inflation is rising while bankruptcies and unemployment continue to swell. It is a problem that would have left Lord Keynes’ head spinning. In many ways, the responses of the U.S. and U.K. governments to the financial crisis have been very similar. So far, the American advantages in size and reserve currency status have allowed us to avoid the storm-clouds now … [visit site to read more]

How David Ricardo Became The Richest Economist In History

Posted: 22 Jan 2010 09:00 AM PST

When David Ricardo started out in business at the age of twenty-one, his property base amounted to £800. By the time he died in 1823, a mere thirty years later, his estate was worth an unimaginable £675,000 to £775,000, from which he enjoyed a yearly income of £28,000. No other economist, not even John Maynard Keynes, has reached this level of affluence.
Ricardo has the distinction of writing erudite theoretical works and making a for-tune. Few economists can boast doing both. Keynes would … [visit site to read more]

Action Date For GENZ’s Lumizyme

Posted: 22 Jan 2010 08:58 AM PST

Genzyme Corp. (GENZ) recently announced that the US Food and Drug Administration (FDA) has assigned an action date for the company's Biologics License Application for Lumizyme (alglucosidase alfa) for the treatment of Pompe disease. Genzyme is seeking approval for Lumizyme which has been produced at its 4000 liter-scale manufacturing plant in Geel, Belgium.
 
Earlier, Genzyme had submitted an application seeking approval for Lumizyme manufactured at its 2000 liter bioreactor scale at … [visit site to read more]

BB&T Beats Zacks Estimates

Posted: 22 Jan 2010 08:56 AM PST

BB&T Corporation (BBT) reported fourth quarter operating earnings per share of 27 cents, substantially ahead of the Zacks Consensus Estimate of 20 cents and the reported figure of 23 cents in the prior quarter. However, earnings decreased from 51 cents in the year-ago quarter.
During the quarter, BB&T's results were driven by strong mortgage banking operations, record insurance income, solid growth in net interest income along with an increase in average client deposits that … [visit site to read more]

Int’l Game Tech Beats, Reaffirms

Posted: 22 Jan 2010 08:42 AM PST

Earnings
International Game Technology (IGT), a leading slot machine developer, reported adjusted earnings of 24 cents per share in the first quarter of 2010, beating the Zacks Consensus Estimate of 20 cents a share by 4 cents. Quarterly earnings of 21 cents per share increased from the year-ago period due to increased cost cutting and higher sales of replacement slots. Shares rose 3.81% in after-hours trading.
IGT said that the prior-year results include new accounting standards adopted in … [visit site to read more]

Weber Shandwick Wins Contract

Posted: 22 Jan 2010 08:41 AM PST

Weber Shandwick, a unit of Interpublic Group (IPG), was recently awarded an $866,000 contract by the Nevada Secretary of State’s Office. According to the contract, Weber Shandwick is supposed to implement a public outreach program designed to ensure a complete and accurate 2010 census count in the State of Nevada.
 
The marketing and outreach plan is a multimedia effort to reach everyone living in the state, particularly communities that are traditionally undercounted. The final details … [visit site to read more]

Schlumberger Profit Dips But Tops

Posted: 22 Jan 2010 08:29 AM PST

Schlumberger Limited (SLB) has reported its fourth-quarter and full-year 2009 results. Diluted earnings per share from continuing operations were 67 cents, compared to the Zacks Consensus Estimate of 63 cents and the year-earlier earnings of $1.03. Diluted earnings from continuing operations for full-year 2009 were $2.78 per share versus $4.50 in 2008.
Total revenue for the quarter decreased 16.4% year over year to $5.74 billion. Oilfield Services revenue was down 17% to $5.17 billion. … [visit site to read more]

IShares Launches Five International Sector ETFs

Posted: 22 Jan 2010 08:25 AM PST

iShares, the San Francisco-based issuer behind nearly 200 ETFs, announced today the launch of five new international sector funds. The five funds, which include four financial ETFs and one materials ETF, expands iShares offerings in the international segment allowing investors to exploit regional differences in sector performance. The new ETFs include the MSCI ACWI ex US Financials Sector Index Fund (AXFN), MSCI Emerging Markets Financials Sector Index Fund (EMFN), MSCI Europe Financials … [visit site to read more]

It’s Time For A Shareholder Protection Act

Posted: 22 Jan 2010 08:21 AM PST

Five members of the Supreme Court have defied logic by assuming that corporations are people. They are not. They are legal fictions, nothing more than bundles of contractual agreements. They are owned by their shareholders.
So what do we do now, other than wait for another Supreme Court opening, and for the President to appoint another Justice who understands this?
Push Congress to enact the "Shareholder Protection Act."
For many years, anti-union lobbyists have pushed what they call … [visit site to read more]

Gee, I Wish I Sold Something, Anything!!!

Posted: 22 Jan 2010 08:20 AM PST

Back on November 16, 2009 and December 1, 2009, I implored investors to sell something, anything. Why? In the absence of a crystal ball, there were technical signposts that were pointing to a market that was running out of momentum. Trust me, I don’t have a crystal ball over here, but the high odds play - which is not always the right play - was to sell something, just anything.

I had based my observations on proprietary research that looks for a clustering of negative divergences between … [visit site to read more]

Trying To Find Direction

Posted: 22 Jan 2010 08:17 AM PST

Fundamentals
Gold futures have given back the gains made since the beginning of the year on a stronger US Dollar and tame inflationary data. Additional gains in the Dollar could further erode demand for the metal and cause traders to look to the treasury market instead. India, the world’s larger user of Gold, imported 18% less Gold in 2009 than it did in 2008, hinting that the physical market may remain cool. The sharp rise in jobless claims in the US also hints that jewelry demand may remain … [visit site to read more]

Abaxis Receives Approval

Posted: 22 Jan 2010 08:15 AM PST

Abaxis, Inc. (ABAX) recently received the U.S. Food and Drug Administration (FDA) approval to market its new C-Reactive Protein (CRP) assay in the United States. The new C-Reactive Protein assay is used by healthcare professionals in conjunction with Abaxis' Piccolo Xpress point-of-care analyzer to conduct on-site chemistry analysis for conditions like infections, inflammatory diseases, tissue injury and few neoplastic processes. The on-site chemistry analysis takes only twelve minutes to … [visit site to read more]

CenterPoint Raises Dividend

Posted: 22 Jan 2010 08:00 AM PST

CenterPoint Energy Inc. (CNP) raised quarterly dividend on its common stock by 2.6% to 19.5 cents from 19 cents per share. The dividend is payable on Mar 10, 2010, to shareholders of record as on Feb 16, 2010. This is CenterPoint Energy's fifth consecutive yearly hike in its common stock dividend. 

CenterPoint Energy's stable and regulated electric power operations and gas distribution utilities generate a relatively stable and growing earnings stream. This is complimented by its … [visit site to read more]

Beating Up On Big Banks

Posted: 22 Jan 2010 07:47 AM PST

Front and center this morning, we saw the risk aversion that held a tight grip on the currencies and commodities for about a week, fade a bit as the day went on yesterday, and the dollar selling has carried through the overnight and morning sessions overseas. "What caused this turnaround?" I hear you asking… Ahhh grasshopper, come sit, and put away the sharp objects!
Yesterday – after the Weekly Initial Jobless Claims rose to near 500,000 once again putting some chinks in the risk … [visit site to read more]

Meridian Misses By A Penny

Posted: 22 Jan 2010 07:45 AM PST

Recently, Meridian Bioscience Inc. (VIVO) reported results for the first quarter of fiscal 2010. The company earned 22 cents per share in the quarter which fell short of the Zacks Consensus Estimate by a penny. Meridian Bioscience earned 20 cents per share in the year-ago quarter. 

Net sales for the quarter came in at $42.45 million as opposed to $34.29 million in the prior-year quarter, up 24%. Segment-wise, sales from its U.S. Diagnostics unit came in at $30.70 million as opposed to … [visit site to read more]

Video: NYSE Opening Bell Market Monitor: GE, MCD, SLB

Posted: 22 Jan 2010 07:35 AM PST

The latest in news, commentary, and information on what’s moving the US equities markets. … [visit site to read more]

GE Exceeds Estimates

Posted: 22 Jan 2010 07:31 AM PST

General Electric Company (GE) reported fourth quarter 2009 earnings per share from continuing operations of 28 cents, exceeding the Zacks Consensus Estimate of 26 cents. Revenues were $41.4 billion for the quarter and $157 billion for the year.
Revenues by Segment
Fourth-quarter Infrastructure orders increased $3.7 billion from third quarter to $22.1 billion. Total company backlog of equipment and services increased slightly from the prior quarter to a record $175 billion.
Service orders … [visit site to read more]

Forex Trading: USD/JPY Holding Below The 100 Day MA 90.34 Level

Posted: 22 Jan 2010 07:30 AM PST

Heading into mid morning trading, the USD/JPY continues to hold below the 100 Day MA (blue line 90.34) at the 90.13 level. The pair has formed a wedge at this level with lows progressively getting higher. Typically with a pattern such as this, the market will force the pair to break out in one direction or another. The bias based on the Daily charts is to the downside.

Looking at the USD/JPY on the Daily chart, we can see the 100 Day MA at 90.34. At this level is also the 38.2% Fibonacci … [visit site to read more]

NetScout’s Q3 Meets Estimates

Posted: 22 Jan 2010 07:30 AM PST

NetScout Systems Inc. (NTCT) reported fiscal 2010 third-quarter earnings on Thursday. The company posted GAAP earnings of $8.5 million, compared to $7.9 million in the year-ago period. Excluding certain special items, adjusted earnings per share came in at 23 cents, which matched the Zacks Consensus Estimate. 

NetScout designs, develops, manufactures, markets and supports a family of integrated products that enable optimization of the performance and cost management of complex, … [visit site to read more]

Schwab Offers ETF Portfolios

Posted: 22 Jan 2010 07:29 AM PST

Charles Schwab is continuing its push into the ETF industry, recently introducing six new managed portfolios of ETFs available through a low cost fee-based portfolio advisory program. The managed accounts program will offer an efficient way for investors to immediately establish a well-diversified portfolio, each of which will be composed of up to 24 ETFs offering exposure to five broad asset classes. "Investors today are looking for more help managing the risk in their investments while … [visit site to read more]

McDonald’s Earnings Jump

Posted: 22 Jan 2010 07:17 AM PST

McDonald's Corporation (MCD) reported robust fourth-quarter 2009 results driven by effective cost control, value offerings and premium products, and a rise in comparable-store sales across all regions.
McDonald's quarterly earnings of $1.03 per share, excluding one-time items, surged 18% from 87 cents posted in the prior-year quarter, and outdid the Zacks Consensus Estimate by a penny. On a reported basis, including one-time items, earnings came in at $1.11 per share, up 28% from year-ago … [visit site to read more]

Intuitive Beats Zacks Estimate

Posted: 22 Jan 2010 07:15 AM PST

Intuitive Surgical, Inc. (ISRG) reported strong fourth quarter and full fiscal 2009 results. For the fourth quarter, earnings per share were $1.95, beating the Zacks Consensus Estimate of $1.71 and the year-ago earnings of $1.27. For fiscal 2009, earnings per share were $5.93, compared to the Zacks Consensus Estimate of $5.72 and the year-ago earnings of $5.12. 

Quarterly results 

Total sales in the fourth quarter increased 40% year over year to $323.0 million. Growth was driven … [visit site to read more]

Get The Hint, Mr. Obama

Posted: 22 Jan 2010 05:00 AM PST

By Dr. Steve Sjuggerud

Most people think the loss for the Democrats in Massachusetts this week was about health care.

But that’s simple thinking.

The real issue is this: Voters are frustrated that their elected representatives in Washington are willfully ignoring their desires.

This one is easy to see…

According to polls, over half of Americans don’t want the government to take control of the health care system. But our elected officials aren’t listening. Instead, they are voting the … [visit site to read more]

Earnings Preview: A Very Busy Week Ahead

Posted: 21 Jan 2010 09:00 PM PST

Earnings Preview 1/22/10
Next week is the heart of the 4Q09 earnings season. There will be a total of 503 firms reporting including 136 members of the S&P 500, and fully one third of the Dow 30. These will include such bellwethers as DuPont (DD), Johnson & Johnson (JNJ), Verizon (VZ), Boeing (BA), Caterpillar (CAT), United Technologies (UTX), 3M (MMM), Altria (MO), Procter & Gamble (PG) and Chevron (CVX). And those are just the Dow names reporting results.
Early … [visit site to read more]

Stock Buy: NewMarket Corporation

Posted: 21 Jan 2010 09:00 PM PST

NewMarket Corporation (NEU) is seeing bullish forecasts ahead of reporting in early February. Analysts polled by Zacks are calling for full-year 2009 earnings of $11.07, an upward revision from $8.37 over the past 3 months.
Company Description
NewMarket Corporation develops, manufactures, blends, and delivers chemical additives that enhance the performance of petroleum products. From custom-formulated chemical blends to market-general additive components, the NewMarket family of companies … [visit site to read more]
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