- Citigroup (C) to outperform from market perform at Bernstein.
- Cubist Pharma (CBST) to outperform from neutral at RW Baird.
- Pentair (PNR) to buy from hold at Citigroup.
- Heritage Financial (HFWA) to outperform from market perform at Keefe Bruyette.
- SL Green Realty (SLG) and Digital Realty (DLR) to market perform from underperform at FBR Capital.
- MGM Resorts (MGM) to neutral from Sell at Janney Capital.
- Ciena (CIEN) to buy from neutral and Olin (OLN) to buy from underperform at BofA/Merrill.
- Mellanox (MLNX) to overweight from equal weight at Barclays.
- ConocoPhillips (COP) and Canadian Natural (CNQ) to overweight from neutral at JPMorgan.
- IDEX (IEX) to outperform from perform at Oppenheimer.
- Taiwan Semiconductor (TSM) to buy from hold at Deutsche Bank.
- Ctrip.com (CTRP) to positive from neutral at Susquehanna.
- Linear Technology (LLTC) and Analog Devices (ADI) to hold from sell at Auriga.
- Quicksilver (KWK) to outperform from market perform at BMO Capital.
"I suspect that as long as the dollar continues its slide our focus on commodities and resource stocks focusing will prove rewarding," says Jack Adamo.
The editor of Insiders Plus explains, "For our latest buy recommendation we'll revisit an old favorite of ours. Over the years we've held 4 positions in ConocoPhillips (COP) and they've gained an average of about 32% for us.
Recently Anadarko (APC) has agreed to buy BP's 93% interest in the Wattenberg Plant, located in the northeastern part of Colorado, for about $575 million. Anadarko already owns the remaining interest in the plant.
Anadarko is the largest producer of natural gas in the Wattenberg field and the deal will provide Anadarko with 100% ownership of the plant. The company relies heavily on natural gas, which we estimate accounts for nearly 40% of its stock value. It vies for business with established oil and gas producers like Exxon Mobil, (XOM) ConocoPhillips (COP), Chevron (CVX), BP (BP) and Duke (DUK).
ConocoPhillips (COP) is likely to gain in the short-term from political tensions in Libya and other Middle Eastern regions due to a rise in crude oil prices globally. However the recent news in Japan following fears of a nuclear crisis gives us some concern. ConocoPhillips and competitors like Exxon Mobil Corporation (XOM), BP (BP) and Anadarko Petroleum Corporation (APC) and Chevron Corporation (CVX) are sensitive to changes in oil prices.
While we expect ConocoPhillips's price of crude oil and LNGs (per barrel) will increase to around $83 by the end of the Trefis forecast period, Trefis members forecast the price rising to $102, implying an upside of 5% to our price estimate for COP stock.
Oil and gas companies like ConocoPhillips (COP) along with Exxon Mobil (XOM) and Chevron (CVX) will gain from increased demand of natural gas as prices have bounced following the recent earthquakes in Japan. These earthquakes have caused disruptions in the country's nuclear power plants, and 11 reactors have been shut leaving many without power. Nuclear power supplies about 30% of Japan's electricity needs, and Japan is expected to turn to natural gas to help fulfill the country's energy needs.
Conoco previously announced plans to close its Kenai LNG plant based in Alaska that mainly serves Japan after contracts with Japanese utilities could not be renewed. In light of the recent events, Conoco and its partner Marathon Oil (MRO) are monitoring the situation closely to help in the short term, but so far they have not changed their plans to shutter the plant.
The recent political turmoil in Tunisia, Egypt, and Libya, which is slowly spreading to other Middle Eastern and North African countries is likely to have an impact on Exxon Mobil's production capacity. This is because the company derives the majority of its revenues from production of crude oil and natural gas liquids (NGLs), and the Middle East and North Africa regions account for a sizable portion of its portfolio.
- Brinker (EAT) to buy from neutral at UBS.
- Starbucks (SBUX) to overweight from equal weight at Morgan Stanley.
- Paccar (PCAR) to overweight from neutral at JPMorgan.
- CA Technologies (CA) to outperform from perform at Oppenheimer.
- PPL Corp. (PPL) to overweight from equal weight at Barclays.
- ConocoPhillips (COP) to hold from sell at Citigroup.
- First Defiance (FDEF) to outperform from market perform at Keefe Bruyette.
- MasTec (MTZ) to outperform from neutral at Credit Suisse.
- Amdocs (DOX) to neutral from underperform at BofA/Merrill.
ConocoPhillips (COP), one of the largest oil and gas exploration and production companies in the world, recently announced that it will partner with NRG Energy and GE Capital to invest $300 million in a joint venture that will promote emerging energy technologies. ConocoPhillips has been a leader in development of new energy technologies with several of its activities focused on power generation and new technologies. Its main competitors are ExxonMobil (XOM), British Petroleum (BP), Anadarko Petroleum Corporation (APC) and Chevron Corporation (CVX).
We maintain a $68.44 price estimate for ConocoPhillips stock, which is roughly 10% below market price.
A little over a week ago the chart players took short positions in the oil sector. Since then the world has changed dramatically.
Egypt is engulfed in a civil uprising and protesters are clamoring for President Hosni Mubarak to step down. Uncertainty is the new state of affairs. Uncertainty breeds fear and fear has taken over the energy sector.
The chart guys quickly covered their shorts and now the bulls have the market. This is fundamental. Three million barrels of oil a day pass through the Suez Canal and the Sumed pipeline. You can throw the charts out the window.
The Dow Jones Industrial Average lost 3.33 points or less than 0.1% yesterday.
Data on December new-home sales will be released at 10 a.m. ET. The latest statement from the Fed is due at 2:15 p.m. ET.
Communications: The telephone companies everywhere are going to have a good year. Verizon is a great stock for Roth IRA's, paying a 5.41% yield. The dilution of the iPhone market may hurt AT&T, Inc. (T) some, as VZ is helped, but it too is a good long term hold and pays an even higher yield at 5.76%.
If you want to diversify internationally there are multiple good choices and they pay even higher yields.
The list of stocks under consideration has been reduced from eleven to ten, to seven and now in today's story four. Starting with five major defense contractors and six major oil companies (see Chasing Value: You Must Own Defense and Oil for Safety), I began a search to find one stock in each sector that might be suitable for inclusion in my list of 2011 stock picks posted last week Chasing Value: 2011 Stock Picks -- The Journey Begin.
Today we continue our analysis by examining return on equity (ROE), return on invested capital (ROIC), and price-to-earnings-to-growth (PEG). Each stock is ranked by sector and metric from best to worst. Sometimes there are clear winners and others there is little to separate one stock from the next. However, in total, a picture can be drawn that does portray a superior opportunity.
This series started with five major defense contractors and six major oil companies that are worthy considerations to help your portfolio survive a global crisis (see Chasing Value: You Must Own Defense and Oil for Safety). After the first review, one stock was eliminated from consideration: Petroleo Brasileiro (PBR). The reason is in the first story.
Today we continue our analysis by examining price-to-book (P/B), price-to-cash-flow (P/CF), and dividend yield. Each stock is ranked by sector and metric from best to worst. In the end we hope to narrow down our choices for candidates that might be added to Chasing Value: 2011 Stock Picks -- The Journey Begins.
All of this has its limits, but, if you are a fan of Professor Nassim NicholasTaleb and his best seller The Black Swan then you already have been warned that the events that have the greatest impact on our lives and our investments are most often unpredictable. We cannot predict the future nor can we anticipate the tragedies that will tank our portfolio's.
While I do believe predicting the future is, how should I say, futile, there are general clues as to which way the wind blows.
The editor of Street Authority Market Advisor explains, "With the dollar sliding, oil prices have climbed back above $87 per barrel and could soon flirt with the $90 mark. And ConocoPhillips produces 1.72 million barrels every 24 hours.
"Through the first nine months of 2010, adjusted earnings in the core exploration and production segment at ConocoPhillips are up more than 100%.