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Apple's iPhone sees lukewarm reception in China debut

Apple Inc.'s (NASDAQ: AAPL) iPhone has been selling like gangbusters in the U.S. since its debut in June 2007, but that kind of fever -- and the fever U.S. consumers felt at every iPhone launch in the U.S. -- seemed tepid by comparison when China Unicom unleashed the iPhone for sale last week.

Continue reading Apple's iPhone sees lukewarm reception in China debut

China Unicom (CHU) will sell iPhone

CHU logoChina Unicom (NYSE: CHU - option chain) stock is trading lower Monday even though the company announced Sunday night that it had reached a deal with Apple (NASDAQ: AAPL) to sell the iPhone in China. The news was not enough to carry CHU against the tide of falling Asian markets as an Apple spokeswomen confirmed that CHU will not be the exclusive carrier of the iPhone in China. 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 CHU.

This morning, CHU opened at $14.00. So far today the stock has hit a low of $13.85 and a high of $14.02. As of 11:30, CHU is trading at $13.99, down 44 cents (-3.0%). The chart for CHU looks bearish and S&P gives CHU a negative 2 STARS (out of 5) sell ranking.

Continue reading China Unicom (CHU) will sell iPhone

Apple rumored to officially enter Chinese mobile market with China Unicom

While Dell, Inc. (NASDAQ: DELL) finally entered the mobile phone market in China today with what could be considered a very disappointing product offering, competitor Apple, Inc. (NASDAQ: AAPL) may be blazing into China as well with its China Unicom partnership for the iPhone.

Continue reading Apple rumored to officially enter Chinese mobile market with China Unicom

Analyst calls: PEP, FIG, PUK, BEN, ASML, X, RDS.A, CHU, SVR ...

Analyst upgrades:
  • PepsiCo (NYSE: PEP) was upgraded to Buy from Hold at Deutsche Bank.
  • Fortress (NYSE: FIG) was upgraded at Citigroup to Hold from Sell.
  • Prudential (NYSE: PUK) was lifted to Overweight from Neutral at JP Morgan.
  • Keefe Bruyette upgraded Franklin Resources (NYSE: BEN) to Outperform from Market Perform and added shares to their Best Ideas List on valuation as they see an attractive risk/reward at current levels.
  • UBS upgraded ASML Holding (NASDAQ: ASML) to Buy from Neutral on valuation as they believe the company remains a market leader.
  • Oppenheimer raised Seattle Genetics (NASDAQ: SGEN) to Outperform from Perform on valuation following the recent weakness as they expect positive clinical news flow beginning in December.
Analyst downgrades:
  • UBS downgraded U.S. Steel (NYSE: X) to Sell from Buy and lowered its target to $30 from $60 citing deteriorating U.S. conditions and concerns about the company's high fixed costs in a falling steel price environment.
  • Royal Dutch Shell (NYSE: RDS.A) was downgraded to Underperform from Neutral at Credit Suisse.
  • China Unicom (NYSE: CHU) was lowered to Underweight from Neutral at JP Morgan.

Continue reading Analyst calls: PEP, FIG, PUK, BEN, ASML, X, RDS.A, CHU, SVR ...

Newspaper wrap-up: Barclays and RBS raided by Office of Fair Trading

MAJOR PAPERS:
OTHER PAPERS:
WEB SITES:

China Mobile drops as China restructures telecom industry

As China continues its massive economic expansion, the country is in a continuous state of flux. According to the New York Times, China has requested its six telecommunication firms to consolidate their assets, effectively paving the way for fixed-line operators to get into the mobile arena.

According to the same Times article, "the parent of China Telecom will buy a mobile phone network from the parent of China Unicom (NYSE: CHU), which in turn will merge with the company that controls the China Netcom Group (NYSE: CN) ... China will issue three third-generation wireless licenses after the overhaul is completed."

The big short-term loser of this directive appears to be China Mobile (NYSE: CHL). The stock was down about 7% Monday off the news. The firm's stronghold on the mobile telecom market in China is now effectively weakened as China Telecom and Netcom can gear up to compete against China Mobile.

Why should this interest investors? Again, according to the Times, China had almost 600 million mobile phone users at the end of April, exceeding the combined populations of the United States and Japan. In the world's largest mobile market in terms of users, the $100 billion market is poised to ramp up given that just over half of all Chinese own mobile phones and a lot less than that have Internet connections.

Zack Miller is the lead equity analyst for America Israel Investment Associates, LLC., the managing editor of IsraelNewsletter.com an d a former equity analyst for a leading multinational hedge fund.

Analyst upgrades: FLR, FWRD and MDR

MOST NOTEWORTHY: Fluor, Forward Air and McDermott were today's noteworthy upgrades:
  • Citigroup upgraded shares of Fluor (NYSE: FLR) to Buy from Hold to reflect the company's strong performance and backlog in Q4 and raised their target to $190.50 from $158.
  • Baird upgraded Forward Air (NASDAQ: FWRD) to Outperform from Neutral citing near-term growth initiatives that are gaining traction.
  • Citigroup also upgraded shares of McDermott (NYSE: MDR) to Buy from Hold to reflect the company's strong Q4 performance and rising commodity prices.
OTHER UPGRADES:

Newspaper wrap-up: More bad news to come for financial stocks?

MAJOR PAPERS:
OTHER PAPERS:
WEB SITES:
  • MiningMx.com reported that BHP Billiton has reached an "impasse" with South Africa's government over the conversion of the company's exploration leases to new order mining rights.

Analyst initiations: PAG, KMX, TWER, SLH and NSTR

MOST NOTEWORTHY: Penske Automotive, CarMax, Towerstream, Solera and Northstar were today's noteworthy initiations:
  • Kevin Dann initiated shares of Penske Automotive Group Inc (NYSE: PAG) with a Buy rating and $25 target. The firm believes shares deserve a higher multiple given the company's reduced exposure to slower growing domestic brands combined with the increased penetration o luxury as a percentage of industry sales.
  • CarMax Inc (NYSE: KMX) was also initiated at Kevin Dann with a Buy rating and $28 target, as they expect the multiple expansion to continue as confidence builds in the company's sales and expense strategy.
  • Think Equities started shares of Towerstream Corporation (NASDAQ: TWER) with a Buy rating and $5 target and said the company is rapidly growing given robust demand fro high bandwidth services, market expansion, sales force growth, and higher ARPU services.
  • Barrington believes Solera Holdings Inc (NYSE: SLH) is positioned to capture growth through technology adoption in claims processing by insurance companies, starting shares off with an Outperform rating and $27 target.
  • Jefferies resumed coverage of Northstar Neuroscience Inc (NASDAQ: NSTR) with a Buy rating and $21 target, as they expect the company's Phase III EVEREST trial to yield positive positives, setting the stage for an FDA approval by Q109.
OTHER INITIATIONS:

A wireless world: China Mobile & China Telecom

By limiting its investment selections to stocks trading on US exchanges, Jim Trippon seeks to benefit from the growth in China without the risks associated with buying shares listed on Chinese exchanges. For example, his China Stock Digest recommends China's two largest wireless telecom stocks – both of which trade as ADRs on the New York exchange.

The first is China Mobile (NYSE:CHL ), which he notes has risen sharply as the company adds subscribers at a record-setting rate. Its total number of subscribers is now 291 million.

This fast growth, he explains, is due to its aggressive push into rural areas this year. He notes that during the first half of 2006, China Mobile added nearly 26 million customers and more than half of them came from underserved rural areas. Although the stock has already risen 80% this year, he says, "China Mobile remains among our top portfolio favorites."

He also recommends China's second largest wireless phone company, China Unicom (NYSE:CHU ). He says, "The firm is growing at a rate that would make any American firm jealous."

And while it still lags in growth and size behind China Telecom, he notes that China Unicom remains "a giant" with 139 million customers. Importantly, some 104 million of these customers use GSM cellular services and almost 35 million use CDMA services, giving the firm a "foothold in the next generation of wireless technology with the continuing rollout of 3G services."

The stock recently rose to a 52-week high after a Morgan Stanley analyst upgraded the stock based on the assumption that the company could sell off some of its parts. Despite its strong performance to date he says, "We continue to see it as a solid performer for the coming year."

Steven Halpern is the editor of TheStockAdvisors.com, a free daily overview of the latest investment ideas from the financial newsletter community.

Symbol Lookup
IndexesChangePrice
DJIA+30.6910,464.40
NASDAQ+6.872,176.05
S&P 500+4.981,110.63

Last updated: November 25, 2009: 04:25 PM

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