Newport Corporation (NASDAQ: NEWP) manufactures a variety of high technology systems and components used in the aerospace, fiber-optic communications, health care, and semiconductor manufacturing industries. These include lasers and amplifiers, photonics instruments, precision micro-positioning systems, vibration isolation systems, optical hardware and opto-mechanical subassemblies. The firm also offers automated systems for manufacturing disk drives, photovoltaic cells and multi-chip modules. Agilent Technologies (NYSE: A) and Corning (NYSE: GLW) are major competitors.
The firm pleased investors last week, when it announced workforce reduction, outsourcing and administrative streamlining actions designed to improve financial performance. Management also guided Q3 revenues to $106-$112 million ($109.7M consensus), Q4 EPS to 15-25 cents (13 cent consensus) and Q4 revenues to $115-$125 million ($121.3M consensus).
Societe Generale upgraded shares of Credit Suisse (NYSE: CS) to Buy from Sell as they believe the company is the European investment bank investors should own as sentiment gradually improves.
Societe Generale also raised Deutsche Bank (NYSE: DB) to Hold from Sell as they believe it has managed the credit crisis well and that the government bailout of the GSEs will improve investor sentiment.
Citigroup upgraded shares of Kimberly Clark (NYSE: KMB) to Buy from Hold as they expect the company to benefit from falling materials and energy prices. The firm raised their target to $71 from $60.
UST Inc (NYSE: UST) was lifted at Morgan Stanley to Equal Weight from Underweight.
Corning (NYSE: GLW) was upgraded to Overweight from Market Weight at Thomas Weisel.
Analyst downgrades:
Credit Suisse downgraded the U.S. Homebuilders sector to Market Weight from Overweight to reflect deteriorating traffic trends and higher valuations. In addition, the firm cut Toll Brothers (NYSE: TOL), Pulte Homes (NYSE: PHM), D.R. Horton (NYSE: DHI) and KB Home (NYSE: KBH) to Neutral from Outperform.
This morning, GLW opened at $17.74. So far today the stock has hit a low of $17.41 and a high of $18.20. As of 12:30, GLW is trading at $17.49, down $2.01 (-10.3%). The chart for GLW looked bullish before today and S&P gives GLW a positive 5 STARS (out of 5) strong buy ranking.
For a bearish hedged play on this stock, I would consider a January bear-call credit spread above the $22.50 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make an 8.7% return in 4 and a half months as long as GLW is below $22.50 at January expiration. Corning would have to rise by more than 28% before we would start to lose money. Learn more about this type of trade here.
The Hidden Tax Traps in the Housing-Rescue Bill Don't get snared in these five hidden traps in the new housing-rescue legislation. The hidden tax traps in the housing-rescue bill - MarketWatch "I Said What?!" It's not easy being a bank CEO these days. Just ask Merrill Lynch's highly paid CEO John Thain. Nearly every promise he's made to investors since he took the helm has been broken. Here are the most regrettable things Wall Street CEOs have said since the credit crunch began. Regrettable Comments by Bank CEOs - Portfolio.com
U.S. stock futures are higher Wednesday morning, a day after markets rallied around 2.4% due to declining oil prices. But today, ADP monthly employment data will be released, as well as weekly oil inventories data. Investors will digest the numbers and the slew of earnings due for release.
Already reported this morning (to name a few):
Comcast (NASDAQ: CMCSA) said its second-quarter profit rose 8% as cable TV rates rose and consumers ordered more digital and premium services. While the results fell short of Wall Street's forecast, CMCSA shares are trading mildly higher.
Arcelor Mittal (NYSE: MT) said its second-quarter profit more than doubled due to increased production and higher steel prices. It also gave an upbeat outlook for third quarter. The company outperformed consensus by about 20% at the revenue. MT shares, which have already close 7% higher Tuesday, are trading up another 6% in premarket action.
Garmin (NASDAQ: GRMN) shares are crashing, trading 11% lower in premarket action after the company reported quarterly profit that was above market estimates, but revenue missed expectations and 2008 outlook was cut due to macroeconomic conditions and high fuel prices that have already impacted growth.
Office Depot (NYSE: ODP) shares are over 1.7% lower in premarket trading after reporting a second-quarter loss as declining spending by smaller businesses and retail customers hurt sales.
Siemens (NYSE: SI) reported that "third quarter net profit fell 31% due to a one-time gain a year earlier, but order intake and revenue rose, beating expectations and showing the industrial conglomerate's resilience so far to the economic downturn." SI shares are 3.9% higher in premarket trading.
Corning (NYSE: GLW) shares are down over 2% in premarket trading after reporting inline earnings per share, but revenue slightly below estimates.
IAC/InterActive (NASDAQ: IACI) said it swung to a second-quarter loss, hurt by a $300 million charge in its Cornerstone Brands business. Adjusted earnings were 35 cents per share as revenue rose 7% to $1.6 billion. Analysts polled by Thomson Financial expected profit of 31 cents per share on $1.6 billion in sales.
World's Largest Owner of Shopping Malls on Hot Seat A Senate report released last week alleges the owner's of Westfield malls; father (Frank Lowy) and son (Peter Lowy) used bank accounts in Liechtenstein to hide money from Uncle Sam as well as the Australian government. The Lowy family denies any wrongdoing and will have the chance to make its case in person this week, as Peter Lowy is scheduled to appear before a Senate investigations subcommittee today. Westfield Unhurt by Lowy Tax Woes - BusinessWeek
MOST NOTEWORTHY: Super Micro Computer, Corning and Vertex Pharmaceuticals were today's noteworthy initiations:
Merriman believes Super Micro Computer (NASDAQ: SMCI) is a unique value in the Data Center sector and thinks it could trade to a range of $10-$12 in the near-term. Shares were initiated with a Buy rating.
Citigroup started Corning (NYSE: GLW) with a Hold rating and $23.50 target. The firm sees limited upside given the risks to LCD glass demand.
Vertex Pharmaceuticals (NASDAQ: VRTX) was assumed with an Overweight rating and $57 target at Thomas Weisel, as they are positive on its telaprevir opportunity.
OTHER INITIATIONS:
Lehman reinitiated Cablevision (NYSE: CVC) with an Equal Weight rating.
Silicon Motion (NASDAQ: SIMO) was initiated at Cowen with an Outperform rating.
Brinks (NYSE: BCO) was initiated with a Positive rating at Susquehanna.
MOST NOTEWORTHY: Norfolk Southern, OfficeMax and PetroQuest Energy were today's noteworthy upgrades:
JP Morgan upgraded Norfolk Southern (NYSE:NSC) to Overweight from Neutral based on leverage to export coal and the tighter truckload market.
Credit Suisse upgraded OfficeMax (NYSE:OMX) to Outperform from Neutral citing the company's clean balance sheet, positive cash flow, and limited downside.
UBS upgraded PetroQuest Energy (NYSE:PQ) to Buy from Neutral citing valuation and production catalysts. The company's target was raised to $30 from $25.
OTHER UPGRADES:
Piper Jaffray (NYSE:PJC) was upgraded to Market Weight from Underweight at Thomas Weisel.
Corning(NYSE:GLW) was upgraded at Merrill to Buy from Neutral.
HSBC lifted BP Plc (NYSE:BP) to Overweight from Neutral.
Calgon Carbon (NYSE:CCC) was raised to Hold from Sell at Morgan Joseph.
This post is part of our Big Company, Small Town series, featuring large companies and the small towns in which they are headquartered.
Rest assured, the first decade of the 21st century is not likely to be remembered as a renaissance period in U.S. history. No one will confuse this decade with the Roaring '20s or even the Wonderful '90s.
Further, if the nation needs an example of rebirth and renewal -- it would be hard to find a better one than the story of multinational corporation Corning (NYSE: GLW), nestled in the small town of Corning, New York.
Corning is your classic, feel-good American success story. And doesn't the United States need a few of those today?
Moreover, Corning, arguably, represents one of the signature corporate transformation stories of the digital age.
From cookware to fiber optics to LCDs
Formerly a primarily glass and cookware company, (who doesn't remember that ubiquitous Corning cookware that was safe for microwave ovens?), Corning successfully transformed itself first into a fiber optic company in the 1990s.
MOST NOTEWORTHY: Corning, BTU International and RiskMetricks were today's noteworthy initiations:
ThinkPanmure believes Corning (NYSE: GLW) is well-positioned to benefit from increased penetration of LCD panels into televisions, flat panel monitors, notebooks, and mobile handsets. Shares were initiated with an Accumulate rating and $31 target.
Thomas Weisel said BTU International (NASDAQ: BTUI) is seeing strong order trends for the company's high margin solar sales in its in-line diffusion furnace and metallization products. The firm started shares with an Overweight rating and $15 target.
RiskMetrics (NYSE: RMG) was assumed at JMP Securities with an Ootperform rating and $26 target. The firm expects RMG to benefit from greater focus on managing portfolio risk and on corporate governance issues.
OTHER INITIATIONS:
Intel (NASDAQ: INTC) was initiated at ThinkPanmure with a Buy rating and $29 target.
Gen-Probe (NASDAQ: GPRO) was assumed at William Blair with an Outperform rating.
Baird initiated BJ's Restaurants (NASDAQ: BJRI) with a Neutral rating and $13 target.
Readers of this space know that my investment bias is toward large-cap companies with demonstrated business models and which have a competitive advantage in established markets, preferably with a favorable global trend as a support. In general, turnaround and business model change plays are avoided, but there are exceptions to the rule, and one is Corning.
Corning Inc. (NYSE: GLW), once a reliable but slow-growth kitchenware and cookware company, today represents one of the signature corporate transformation stories of the digital age.
Corning is one of the leading providers of fiber-optic cable, which the company invented more than 30 years ago. Further, its substrates business did not draw Wall Street's attention until technological advances enabled the price-competitive production of flat panel displays in flat panel televisions, desktop monitors and notebook computers.
"Showing big gains in the world of video, LCD TV panel maker AU Optronics reported revenue of $4.5 billion in its first quarter, marking a 12.1% quarter-over-quarter decline that seemed to square with normal seasonality, even as it was negatively affected by the weaker U.S. dollar.
"Earnings thus came in at $1.12 per U.S. ADR, vastly improved from the loss of $0.02 per ADR in the same quarter last year. Looking forward, management says sales of TVs yet have not been impacted by the slowdown, though they are cautiously watching the markets for signs of weakness.
"Pleased with the positive report, we remain buyers of the shares, which trade at just about 6 times the consensus average for earnings per ADR now showing on Reuters Estimates.
a variety of high technology systems and components used in the aerospace, fiber-optic communications, health care, and semiconductor manufacturing industries. These include lasers and amplifiers, photonics instruments, precision micro-positioning systems, vibration isolation systems, optical hardware and opto-mechanical subassemblies. The firm also offers automated systems for manufacturing disk drives, photovoltaic cells and multi-chip modules. Agilent Technologies (NYSE: A) and Corning (NYSE: GLW) are major competitors..gif){kind=logo}
Here are some highlights from this past week's 
U.S. stock futures are higher Wednesday morning, a day after markets rallied around 2.4% due to declining oil prices. But today, ADP monthly employment data will be released, as well as weekly oil inventories data. Investors will digest the numbers and the slew of earnings due for release.
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This post is part of our .gif){kind=logo}
Readers of this space know that my investment bias is toward large-cap companies with demonstrated business models and which have a competitive advantage in established markets, preferably with a favorable global trend as a support. In general, turnaround and business model change plays are avoided, but there are exceptions to the rule, and one is Corning. 
Is the market always right?
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