Diodes Incorporated (NASDAQ: DIOD) is engaged in the design, manufacture and marketing of semiconductor products, including diodes, transistors, and rectifiers. The firm focuses on devices with end user applications in the consumer electronics, computing, industrial, communications and automotive sectors. Customers include Intel (NASDAQ: INTC) and Nortel Networks (NYSE: NT).
The firm is expanding its reach, via the acquisition route. It completed its purchase of British chip maker Zetex, on June 9th. That led management to increase its guidance for Q2 revenues from $100-$106 million to $114-$117 million. The Street had been looking for $104.27 million. Guidance for gross profit was boosted from a sequential increase of 4-9% to a sequential increase of 18-21%.
Today was yet another day where Joe Public felt like he spent a round in the ring with Joe Lewis. It's getting that way again, and now the only real positive is that contrarians may start to get happy.
Oil jumped back up another $5.00 per barrel on inventory numbers reported this morning. The continued weak environment sent financials and airlines into the dirt again. PIMCO's McCulley said he believes that the Fed is understating inflation and the Fed's Beige Book hinted that some higher costs are beginning to be passed down to consumers.
Here are the unofficial closes of major US index levels: DJIA 12082.14 (-207.62) S&P500 1335.56 (-22.88) NASDAQ 2394.01 (-54.93) 10YR T-NOTE 4.07% (-0.026%) Top 10 Analyst Calls Anheuser-Busch Companies Inc. (NYSE: BUD) saw another big pickup in its call options activity today and then CNBC's David Faber said that InBev in Europe may be close to making an unsolicited bid for the company. Shares were up about 2.3% at $58.45 in the final minutes of the day.
Alcoa Inc. (NYSE: AA) said its Australian operations declared force majeure under supply contracts because an explosion at a gas supplier slowed production. Alcoa said the disruption will likely lower second-quarter earnings by 2 cents to 3 cents a share. Also, JP Morgan downgraded Alcoa from Overweight to Neutral, saying the company will not be a takeover target.
Bloggers, investors and Apple Inc. (NASDAQ: AAPL) weren't just interested in the new 3G iPhone unveiled Monday. Many of them commented on the appearance of CEO Steve Jobs and voiced concerns for his health, saying he was gaunt-looking. While a spokeswoman said Jobs was hit with a common bug, many are worried since Jobs was diagnosed with a rare form of pancreatic cancer four years ago, for which he underwent surgery that Apple said was successful.
Caterpillar (NYSE: CAT) was awarded a $397.1 million contract from the U.S. Army for two types of dozers with armor kits. The contract has one five-year option. Work is expected to be completed by 2018. Caterpillar is also holding its annual meeting today.
In a reorganization of China's telecom industry, which will change the face of the wireless industry, the country plans to merge two of its largest mobile companies, China Netcom (NYSE: CN) and China Unicom (NYSE: CHU). The new firm will be issued on of the three high-speed wireless licenses that the government plans to grant.
China's two largest phone companies, China Mobile (NYSE: CHL) and China Telecom, will receive the other two contracts.
The news may also be a benefit to handset makers as they rush to offer products for the new 3G networks. Apple (NASDAQ: AAPL) has still not found a home for the iPhone in China.
More competition among carriers will give it a greater chance to strike a good deal. A new market could also give some aid to Motorola's flagging handset sales and to rivals Samsung and Sony Ericsson.
Douglas A. McIntyre is an editor at 247wallst.com.
Next week is sure to be filled with fun and volatile market conditions. The highlight will be the Fed decision on key rates, due on Wednesday, April 30, following a two-day meeting. Anytime the Fed has the floor, the markets listen. Tuesday and Wednesday will be filled with speculation up until the time of the announcement of a cut or pause.
There are many possible outcomes for this meeting, as we have seen a substantial change in investor sentiment regarding the potential need for further rate cuts. The buzz on the street is for a cut of 25 basis points and then a wait-and-see attitude from there. I think that is the most likely direction.
There has been a great deal of concern that all the recent rate cuts have not provided the benefit to consumers the economy needs. Clearly, there is a fatty clog within our financial circulatory system. Traditionally, the Fed likes to see how its actions trickle into the economy before it continues too far down one path, which would argue for a pause now. Plus, the Fed does not want to run out of ammunition by cutting rates too far too fast. But there is no question that we are dealing with a more aggressive Fed than we have seen in decades, so I think we will see another small rate cut.
MOST NOTEWORTHY: Seagate, Nortel Networks and Ann Taylor were today's noteworthy downgrades:
Thomas Weisel downgraded Seagate (NYSE: STX) to Market Weight from Overweight as they believe the company's growth will be more muted given high existing market share and overall industry growth.
Baird downgraded Nortel (NYSE: NT) to Neutral from Outperform citing checks that indicate deteriorating US Enterprise sales in the last few weeks of Q1. The firm now expects companies to guide flat QoQ instead of up and to make cautious 2H08 comments.
Ann Taylor (NYSE: ANN) was cut to Neutral from Buy at Piper to reflect concerns over the LOFT division as well as consumer spending.
OTHER DOWNGRADES:
Citigroup lowered TJX Cos (NYSE: TJX) to Hold from Buy.
WestLB downgraded to Hold from Add Novartis (NYSE: NVS).
EXFO Electro-Optical Engineering (NASDAQ: EXFO) specializes in the design and manufacture of equipment used by telecommunications carriers, cable television companies and public utilities operators to test and monitor their networks. It also provides light-based systems used in medical device and opto-electronics assemblies, as well as fluorescence microscopy and electrophysiology instruments used in the life sciences sector. Customers include AT&T (NYSE: T) and Nortel Networks (NYSE: NT). Agilent Technologies (NYSE: A) is a major competitor.
The company pleased investors last week, when it reported fiscal Q2 EPS of six cents and revenues of $43.3 million. Analysts had been expecting two cents and $42.3 million. Management also guided Q3 EPS to between four and seven cents (five cent consensus) and Q3 revenues to between $45 million and $48 million ($46.93 million consensus). Further, the firm announced a deal to acquire Internet Protocol applications tester Brix Networks for $28.5 million in cash. RBC Capital Markets and Roth Capital subsequently reiterated "buy" ratings on the stock and declared price targets in the $7-$8 range
Nortel Networks Corp. (NYSE: NT) stock is plummeting this morning after the company reported a fourth-quarter net loss of $844 million, or $1.70 per share. Adjusting for a onetime noncash expense of $1.06 billion related to a deferred Canadian tax asset, NT earned 34 cents per share, but that was still lower than Wall Street's expectation of 44 cents per share. NT executives blamed higher operating costs for the disappointing earnings If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on NT.
After hitting a one-year high of $30.27 last February, the stock hit a one-year low of $10.28 in January. This morning, NT opened at $10.28. So far today the stock has hit a low of $9.67 and a high of $10.28. As of 10:45, NT is trading at $9.76, down 1.69 (-14.8%). The chart for NT looks bearish and steady, while S&P gives the stock a positive 4 STARS (out of 5) buy rating.
Consumers Cut Back on Small Pleasures PowerBars, Starbucks Lattes, Evian Water -- When times are good people don't think twice about these little splurges, but when times aren't as good every penny counts and consumers start to pull back from these small luxuries -- and that is happening now. The murky financial outlook and recession fears are factors. Another driver: fear of being out of step with a cultural mind-set that increasingly says less is more. If your best friend and next-door neighbors are cutting back on little luxuries, shouldn't you be, too? Consumers cut back on small pleasures - USATODAY.com
How to Spot a Health Care Scam When medicare introduced Part D coverage to pay for prescription drugs in 2006, it gave seniors a golden opportunity to save money -- and crooks a golden opportunity to steal it. Unscrupulous agents can switch your policy to an over-priced product without authorization. How to Spot a Health Scam - Kiplinger.com
After Apple Inc. (NASDAQ: AAPL) announced Tuesday it was touching up its lineup of MacBook and MacBook Pro laptops. Meanwhile, Apple's iTunes digital media store became the second-largest U.S. music retailer, behind Wal-Mart Stores (NYSE: WMT), leaving Best Buy Co (NYSE: BBY) and Target Corp (NYSE: TGT) behind. Following all that, many analysts had something to say on the future of the company and Barron's Savitz rounded their comments. Mostly, they reiterate their rating and price targets.
New studies show that widely-used drugs for anemic cancer patients can increase the risk of blood clots anddeath rates. The drugs are mainly made by Amgen (NASDAQ: AMGN) and Johnson & Johnson (NYSE: JNJ).
Starbucks (NASDAQ: SBUX) has shut down most of its U.S. shops for three hours to retrain baristas on espresso basics Tuesday, and today it opened the stores with a new promise: "Your drink should be perfect, every time. If not, let us know and we'll make it right." Since Schultz took over the head post again, he's been trying to restore Starbucks to what it has been with the latest being a retraining of the staff and the upholding of the company's pledge. Time will tell if it will help.
The active ingredient in Baxter International Inc's (NYSE: BAX) generic version of the anticlotting drug heparin, under investigation for four deaths and hundreds of bad reactions, was made in China, the Wall Street Journal reported.
Mike Zafirovski, CEO of Nortel Networks Corporation (NYSE: NT), said the company would examine possible opportunities to be taken over "when they arise." Mr. Zafirovski did not comment on rumors of a Motorola Inc (NYSE: MOT) merger, Reuters reported.
engaged in the design, manufacture and marketing of semiconductor products, including diodes, transistors, and rectifiers. The firm focuses on devices with end user applications in the consumer electronics, computing, industrial, communications and automotive sectors. Customers include Intel (NASDAQ: INTC) and Nortel Networks (NYSE: NT).
Nortel Networks
Next week is sure to be filled with fun and volatile market conditions. The highlight will be the Fed decision on key rates, due on Wednesday, April 30, following a two-day meeting. Anytime the Fed has the floor, the markets listen. Tuesday and Wednesday will be filled with speculation up until the time of the announcement of a cut or pause.
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