Media Digest 4/17/2008 Reuters, WSJ, NYTimes, FT, Bloomberg from 24/7 Wallst.
According to Reuters, the head of Samsung has been indicted for tax evasion.
Reuters writes Ebay (EBAY) profits rose 22%, but the company was cautious about the rest of the year.
Reuters reports that JP Morgan (JPM) will sell $6 billion in preferred shares.
Reuters writes that IBM (IBM) profits rose on strength in its service and software divisions.
Reuters reports that it has completed its merger with Thomson.
Reuters writes that Sallie Mae (SLM) posted a first quarter net loss.
The Wall Street Journal writes that Yahoo! (YHOO) is close to a deal to outsource some of its advertising to Google (GOOG).
The Wall Street Journal writes that tech firms like EMC (EMC) and Ebay are building cash reserves in case of a prolonged economic slump.
The Wall Street Journal writes that Sallie Mae claims it cannot make profitable loans.
The Wall Street Journal reports the Freddie Mae (FNM) will unveil a news package with lenders.
The Wall Street Journal writes that Cisco’s new acquisition program will allow companies it buys to operate as independent units.
The Wall Street Journal writes that GE’s (GE) embattled CEO defended his strategy for holding the company together.
The Wall Street Journal writes that many hedge funds have moved into cash.
The Wall Street Journal writes that crude moved above $115.
The Wall Street Journal reports that AMR (AMR) had a loss as fuel prices surged.
The New York Times writes that retailers are stopping giving monthly sales figures.
The New York Times writes that researchers are concerned that plans for Google and Microsoft to store medical records could cause privacy problems.
The FT writes that CBS (CBS) will open a Silicon Alley office.
SPWR reports Q1 EPS 39c vs. consensus of 35c
Reports Q1 revenue $273.7M vs. consensus of $245.21M. Sees 2008 EPS $2.10-$2.20 vs. consensus of $2.07, sees 2008 revenue $1.3B-$1.375B vs. consensus of $1.27B. Reconfirms 2009 forecast for revenue up at least 40% from 2008 levels. Sees Q2 EPS 48c-52c vs. consensus of 46c, sees Q2 revenue $300M-$350M vs. consensus of $295.13M.
The numbers look really good but SPWR is doing a sell the news reaction in premarket, let’s see how it and the rest of the solars react to these numbers throughout the day and for the rest of the week.
GILD reports Q1 EPS 54c vs. consensus of 48c
Reported EPS with stock-based compensation was 51c. GILD reports Q1 revenue $1.26B vs. consensus of $1.22B. HIV product sales were $964.7M, a 37% increase over the same period in 2007. Truvada sales were $479.4M, up 39% from the first quarter of 2007 GILD target raised to $58 from $49, maintain Outperform@OPCO
After the company reported stronger than expected Q1 results, Oppenheimer believes sales of the company’s Atripla outside of the U.S. will result in higher sales of the company’s HIV treatments over the next few quarters. The firm believes the company’s valuation is attractive, and they expect Gilead to successfully launch two new drugs in 2H08.
Excellent results, see if there is follow through in the shares.
Merrill Lynch (MER) reported its third consecutive quarterly loss and announced write-downs of $6B. The company then said they expect a “slow” next couple of quarters, but that they remain confident in the strength of their CDO hedges, saying they wrote down less than $50B of MBIA hedges. The company’s CEO said he was optimistic about the rest of the year. Merrill Lynch shares are trading down -35 cents at $44.45 a share.
Initial jobless claims reported up 372,000 versus an expected 375,000.
IBM: Estimates and target raised to $135 from $130, reiterate Buy@GSCO IBM upgraded to Buy from Hold, target to $150@ADAM
Canaccord Adams upgraded IBM to Buy and raised their target to $150 from $110. IBM target raised to $157 from $146, reiterate Buy@SBSH
Citigroup found IBM’s margin and EPS upside in Q1 impressive and the stock remains their number two pick for the year.
EBAY: Reiterate Overweight following better than expected results@JPMS
JP Morgan thinks EBAY’s recent changes are starting to bear fruit and finds the stable user growth encouraging.
USO: Pivot Points
The following are the pivot points for the United States Oil Fund (USO). Pivot High: $93.365, Pivot Low: $91.085. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low. :
SPY: Pivot Points
The following are the pivot points for the Standard and Poor’s Depository Receipts (SPY). Pivot High: $138.155, Pivot Low: $135.625. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.
DJX: Pivot Points
The following are the pivot points for the Dow Jones Industrials Index (DJX). Pivot High: 12749.66, Pivot Low: 12495.39. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.
QQQQ: Pivot Points
The following are the pivot points for the Nasdaq 100 Index Tracking Stock (QQQQ). Pivot High: $45.84, Pivot Low: $45.01. These were calculated using the DeMark method. It is generally believed to be bullish when price breaks out above the pivot high or bearish when price breaks down below the pivot low.
EDU target raised to $93 from $80, reiterate Buy@PIPR
Piper raised their estimates and target following EDU’s “solid” Q3 results and feels the gaokao tutoring school growth prospects look promising.
X downgraded to Hold from Buy@SBSH
Citigroup downgraded shares on valuation and believes margin expansion may slow. Target raised to $160 from $145.
POT: Target to $300 from $250, reiterate Top Pick@RBCM RBC Capital raised POT’s price target to $300 citing the settlement of the 2008 Chinese potash negotiations, which will result in higher prices.
Excellent contract prices are now trickling into estimates. POT to $300 is feasible in the future.
Let’s watch the Ag’s to see how they react to the market conditions, this upgrade and their higher technicals.
XEC coverage assumed with a Buy from Neutral@UBSW
Target to $68 from $45. COG initiated with a Buy, target $73@UBSW
USU initiated with a Sell@MLCO
Fed Bank Pres Fisher speaks 2pm to the Council on Global Affairs in Chicago 4/17
Pre-Market Movers: Ahead of the Bell from flyonthewall.com
The session is relatively quiet outside of names that reported earnings last night or this morning. There may be quite a bit of action today as we head toward expiration tomorrow. This may lead to unusual volatility in names and volume as well. Nokia (NOK) is the volume leader this morning trading down (-10.9%) after it reported weaker than expected results before the bell. eBay (EBAY) is trading down (-1.6%) despite beating earnings estimates last night. The company took down the lower end of guidance slightly which may be responsible for the selling. SunPower (SPWR) is trading down (-3.6%) despite beating earnings estimates, raising guidance for the next quarter and affirming 2009 targets. Ericsson (ERIC) is down (-3%) in sympathy with NOK. Pfizer (PFE) is trading down (-3.69%) after it missed earnings estimates in a report before market open. IBM Corp (IBM) is one of the bright spots, trading up +2.13% after beating estimates in an earnings report after market close and issuing upbeat guidance. Harley-Davidson (HOG) is trading down (-7.2%) after it beat Q1 EPS but lowered 2008 earnings well below consensus. International Game Tech (IGT) is down (-3.97%) after widely missing earnings estimates in a report before the open.
Fast Money position recap (Gartman position update!)- Adami likes MSFT. Carter likes ICO as a laggard in the coal space. Pete likes HK. Tim thinks PBR is a short for the next 4 or 5 sessions. Najarian Owns (AAPL), (BIIB), (CSCO), (TSO), (YHOO), (XLF), (AMR), (ETFC), (ATI); Najarian Owns (EBAY) Calls, (IBM) Calls, (BSC) Calls, (COP) Calls, (MSFT) Calls, (HK) Calls; Najarian Is Short (INTC) Calls; Najarian Owns (LEH) Puts; Seymour Owns (AAPL), (CSCO), (INTC), (MER), (MSFT), (TSO); Seygem Asset Management Owns (TIE), (COP), (PKX), (GGB). Gartman Owns (SJT), (NFLX), (AAPL), (JPM), (RIMM), (PCU), (GLD), (SWC), (ICE), (CQB), (GE), (AGU), (FSLR), (SDS)
Gartman Is Short (WFMI), (GM), (PSP), (DRYS), (SWY)
Gartman Is Short (NFLX) Calls, (PCU) Calls, (RIMM) Calls
CIBC Gartman Index Owns Copper, Aluminum, Gold, Sugar, Corn, Soybeans, the EUR, Natural Gas
CIBC Gartman Index Owns Natural Gas Futures
CIBC Gartman Index Is Short Crude Oil
Market is taking a breather this morning and besides earnings is fairly quiet. Keeping a strong focus on the energy patch today but also watching the solars, Ag’s, steel (looks like some profit taking). It will be interesting to see how the market trades today. I would like to see follow through but we could get a down day on some profit taking. Stay nimble and look for great setups! Stay positive and confident. Great trading and good luck!
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