MOST NOTEWORTHY:

• Stifel downgraded Hilton Hotels (NYSE: HLT) to Hold from Buy at Stifel based on the recent acquisition.

• TD Newcrest cut TransAlta (NYSE: TAC) to Sell from Hold and doesn't consider an LBO of the company likely.

• Rodman cut Cascade (NYSE: CAE) to Market Underperform from Market Perform based on valuation.

• Activision (NASDAQ: ATVI) was downgraded to Neutral from Outperform at JP Morgan based on valuation and the competitive environment.

• AG Edwards believes Atheros Communications (NASDAQ: ATHR) has a less favorable risk/reward and cut shares to Hold from Buy...

• Needham downgraded Kyphon (NASDAQ: KYPH) to Buy from Strong Buy.

• UBS downgraded Taiwan Semiconductor (NYSE: TSM) to Neutral from Buy.

• Deutsche Bank cut Chicago Mercantile Exchange Holdings (NYSE: CME) to Hold from Buy.

• Roche Holding Ltd (OTC: RHHBY) was downgraded to Hold from Buy at Citigroup.

Analyst downgrades 7-11-07: ATVI, CME, HLT and TSM originally appeared on BloggingStocks on Wed, 11 Jul 2007 10:57:00 EST. Please see our terms for use of feeds.

No June gloom for hedge funds originally appeared on BloggingStocks on Wed, 11 Jul 2007 09:00:00 EST. Please see our terms for use of feeds.

A pair of lawsuits seeking class-action status accuse Hilton Hotels (NYSE: HLT) management of breaching their fiduciary responsibility to shareholders when they agreed to sell the company to The Blackstone Group (NYSE: BX) for $20.1 billion. The investors claim the size of the offer was inadequate, and the $560 million break-up fee Hilton will have to pay Blackstone if it backs our of the deal is excessive. The amount is so large they contend, that it effectively guarantees that the private equity firm will go home with the prize.

There are a couple of interesting things about this. First, the break-up fee does seem excessive. The idea of a break-up fee, ideally, is to compensate the prospective buyer for its time/use of resources if a deal fails to go through. The $560 million figure would give Blackstone a huge windfall if the deal fails to go through. While the lawsuit is unlikely to go anywhere, I would ask Hilton why such a large break-up fee was necessary.

Second, this shareholder angst may be one of the factors that will lead to the decline of the buyout boom. In recent months it seems, shareholders have grown increasingly feisty in taking on buyout offers they deem too low. This wave of shareholder activism, which often leads to higher buyout prices, can cut into the private equity firms' margin for error.

But this is probably a good thing: If a private equity firm can take a company private and make a ton of money, it might make more sense for the company to stay public and provide that value to shareholders.

Hilton Hotels sued over sale to Blackstone originally appeared on BloggingStocks on Sun, 08 Jul 2007 12:10:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Goldman cut shares of Ruth's Chris Steak House (NASDAQ: RUTH) to Sell from Neutral following the company's preliminary Q2 sales, as they expect relative underperformance over the near-term. Goldman believes macro headwinds could weigh on Ruth's client base and keep traffic negative for the rest of the year.

• Hilton Hotels (NYSE: HLT) was downgraded by a number of firms after the Blackstone Group (BX) takeout offer: Jefferies and Citigroup cut shares to Hold from Buy, Calyon downgraded shares to Neutral from Buy, Raymond James downgraded shares to Market Perform from Strong Buy, Suquehanna cut shares to Neutral from Positive and Bear Stearns downgraded Hilton Hotels to Peer Perform from Outperform.

• B. Riley downgraded shares of Champps Entertainment (NASDAQ: CMPP) to Neutral from Buy to reflect the buyout offer from F&H Acquisition Corp...

• B. Riley downgraded shares of ACR Group (AMEX: BRR) to reflect the company's merger agreement with Watsco Inc (WSO).

• Jefferies cut Dobson Communications Corp (NASDAQ: DCEL) to Hold from Buy.

• Piper Jaffrey downgraded Selective Insurance (NASDAQ: SIGI) to Market Perform from Outperform.

• Kaufman downgraded Parametric Technology (NASDAQ: PMTC) to Hold from Buy.

Analyst downgrades 7-06-07: DCEL, HLT and RUTH originally appeared on BloggingStocks on Fri, 06 Jul 2007 09:50:00 EST. Please see our terms for use of feeds.

Before the bell 7-6-07: AAPL, BA, BP, HLT, BKC ... originally appeared on BloggingStocks on Fri, 06 Jul 2007 08:39:00 EST. Please see our terms for use of feeds.

In the past Mike Fowlkes, Sarah Gilbert and I have pointed out what seems blatant illegal activity in Dow Jones (NYSE: DJ) and Aquantive (NASDAQ: AQNT). Now there is activity in Hilton Hotels (NYSE: HLT) worth taking a look at.

Hilton Hotels closed up 9.34 to $45.39 today on news the company agreed to be acquired by Blackstone Group (NYSE: BX) in a deal valued at $26 billion. A reader pointed out interesting activity on Hilton Hotels.

With the stock up, let's look and see how many "lucky" traders picked up calls on the stocks. A call option gives the buyer the right to buy the stock at a set price. If you think a stock is going to go up you can buy the right to buy that stock at a set price, in the hopes that it does in fact go up, as you expect.

The Hilton July 35 calls (HLTGG) had a volume of 3,660 Tuesday with a high price of $1.90. That is above the average volume of 314 calls per day since the options were issued and just above the previous record high daily volume of 3,616 on 5/31. Those calls are now worth about $10.50 a piece so a 450% gain over two days isn't bad. I have to say this looks suspicious; sort of like a man running from a bank with a bag of money.

Looking at the Hilton August 40 calls (HLTHH) it becomes a little more obvious. Tuesday there were 5,844 contracts for 0.85 cents or less. In the past three weeks -- since the options came out there were only a total of 70 contracts traded. The contracts bought Tuesday are now worth about $5.80 a piece. A 582% gain in two days, representing about $2.8 million in profits.

If that isn't enough money ...there is more. The July 40 calls (HLTGH) saw 3,312 contracts trade Tuesday for less than 0.40. Now at 5.50 it is a 1,275% return for another $1.6 million in profits.

While I do not know who made the trades, their intentions and what they knew when; I am betting they will soon be getting a call from the SEC. In all fairness, just because I see a man wearing a black ski mask running out of the bank carrying a bag of money and a gun doesn't mean he is a bank robber. These trades could be legit, but they trades have all the tell-tale signs of insider trading. By the way has anyone been following Paris recently? Has she been meeting with Martha Stewart?

Kevin Kersten is an Options Analyst with InvestorsObserver.com. Do you have any deadwood in your portfolio? Check out the 18 Warning Signs That Tell You To Dump A Stock.

Disclosure note: Mr. Kersten owns and or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

Is Paris Hilton taking stock trading tips from Martha Stewart? originally appeared on BloggingStocks on Thu, 05 Jul 2007 19:00:00 EST. Please see our terms for use of feeds.

Cramer lists Mariott among potential hotel targets originally appeared on BloggingStocks on Thu, 05 Jul 2007 13:10:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Bear Stearns cut General Motors (NYSE: GM) to Peer Perform from Outperform based on valuation and growing fundamental headwinds.

• HSBC downgraded Aluminum Corp of China (NYSE: ACH) to Underweight from Neutral as they believe prices of lightweight metal have peaked.

• Greenbrier Cos (NYSE: GBX) was cut at Bear Stearns to Peer Perform from Outperform on valuation.

• Matrix USA downgraded Monsanto (NYSE: MON) to Buy from Strong Buy on valuation...

• Sandler cut Western Alliance Bancorporation (NYSE: WAL) to Hold from Buy.

• UBS cut Arris Group (NASDAQ: ARRS) to Neutral from Buy.

• AG Edwards downgraded Hilton Hotels (NYSE: HLT) to Sell from Buy. Gabelli cut Hilton Hotels to Hold from Buy.
  

Analyst downgrades 7-05-07: ACH, ARRS, GM and HLT originally appeared on BloggingStocks on Thu, 05 Jul 2007 10:21:00 EST. Please see our terms for use of feeds.

Now that Blackstone (NYSE: BX) has bought Hilton (NYSE: HLT) for $26 billion, The Wall Street Journal is asking [subscription required] whether Marriott (NYSE: MAR) and Starwood (NYSE: HOT) might be next.

The question is reasonable. Hilton has outperformed the other two companies in the stock market over the last two years, with its shares up 50%. Some of that is due to recent takeover speculation.

Marriott's shares are up only 30% over that period and Starwood's only 15%. All three companies have market caps in the $15 billion to $20 billion range, so none is so large as to be outside the financial ability for a private equity firm to take them over.

But, Starwood may make the easier target. Marriott is still controlled by its founding family while Starwood has had a bit of musical chairs in its executive suite. The company's CEO left in April.

Starwood has had virtually no growth in revenue over that last four quarters, and had low operating income in its last reported quarter. If private equity interests think they can improve that, the company becomes an attractive candidate.

Douglas A. McIntyre is a partner at 24/7 Wall St.

With Hilton sold, will Marriott and Starwood be next? originally appeared on BloggingStocks on Thu, 05 Jul 2007 09:45:00 EST. Please see our terms for use of feeds.

• At 8:30 a.m., the weekly job claims report is due, but will only be a prelude for tomorrow's June employment report.
• At 10:00 a.m., the Institute of Supply Management's non-manufacturing poll for June is due and could show a slight decline.
• At 10:30 a.m., weekly crude inventories are due. While expectations are generally for higher gasoline supplies and refinery output, oil prices rose today due to concerns over the summer driving season and violence in Nigeria. Oil remained above $71 a barrel.
  

Before the bell 7-5-07: Holiday mood continues, stock futures higher originally appeared on BloggingStocks on Thu, 05 Jul 2007 07:51:00 EST. Please see our terms for use of feeds.

Yesterday we learned that Starbucks (NASDAQ: SBUX) is taking another shot at the movie promotion business by pushing (for a cut of the action) the National Geographic movie "Arctic Tale." Starbuck's initial effort, last year's "Akeela and the Bee," had indifferent results.

While most of the big releases for 2007 already have commercial tie-ins, I thought about other companies that might make money by offering some targeted marketing. Perhaps

• Ratatouille -- KFC (Yum Brands, NYSE: YUM)
• The 40-year old Virgin -- Weight Watchers Intl (NYSE: WTW)
• Sicko -- The Church of Scientology
• Live Free or Die Hard -- Viagra (Pfizer, NYSE: PFE)
• Evan Almighty -- Chris Craft
• Transformers: The Mitt Romney Campaign
• The Simpsons Movie: Sylvan Learning
• Hairspray: Lane Bryant (Charming Shoppes, Inc., NASDAQ: CHRS)
• Hostel: Part II -- Hilton Hotels (NYSE: HLT)
• 1408 -- Hostelling International

And, as a special subscriber gift offer promotion,

• The Wall Street Journal (Dow Jones, NYSE: DJ) -- Citizen Kane

Starbucks setting a new trend by promoting movies for a cut of the action? originally appeared on BloggingStocks on Fri, 29 Jun 2007 14:01:00 EST. Please see our terms for use of feeds.

Examining Carl Icahn's portfolio: Hilton Hotels originally appeared on BloggingStocks on Wed, 27 Jun 2007 13:27:00 EST. Please see our terms for use of feeds.

Paris without a network; schadenfreude ensues originally appeared on BloggingStocks on Mon, 25 Jun 2007 17:10:00 EST. Please see our terms for use of feeds.

General Electric

NBC finds Paris' drivel worth a 'hot' million originally appeared on BloggingStocks on Thu, 21 Jun 2007 15:53:00 EST. Please see our terms for use of feeds.

America is a "sue-happy" country. Where else can you sue the dry cleaners for $54 million because they lost your Hickey Freeman pants. You think I am joking; but this is a case of life being stranger than fiction. A Washington DC judge (who in my opinion should know better) is suing a dry cleaners that lost his pair of pants.

For a moment last week my trust in the American legal system began to fail as Paris Hilton, heiress of Hilton Hotels (NYSE: HLT) fortune, spent a heart-wrenching three days in jail before being released by the sheriff for "medical reasons." Then suddenly my faith was restored as the judge sent her back to jail.

Well it didn't last long. It seems this week a pair of lost pants is worth crying over -- and $54 million. I guess America is land of the free and home of too many lawyers. Maybe this is why I respect Vice President Cheney: I mean, we all talk about the problem with lawyers, but at least he shot one.

Continue reading Lawyers and the $54 million pants

Lawyers and the $54 million pants originally appeared on BloggingStocks on Wed, 13 Jun 2007 14:45:00 EST. Please see our terms for use of feeds.

With media coverage of Paris Hilton approaching a frenzy, or at least the overload level, you may be wondering how the company and stock to which she is an heiress rates as an investment.

Hilton (NYSE: HLT) has experienced a nice run-up in price in 2007, topping out at about $38 from around $27 in October, before mirroring the market in the last few months: the stock has consolidated in a $33-$36 range; HLT shares closed down $0.52 Tuesday to $34.32.

With both business and leisure travel fundamentals solid, Hilton has been in expansion mode, and the company plans to add 250 hotels and about 35,000 rooms to its 2,800-property and 483,000-room system. Operationally, HLT is solid: analysts expect per room revenue -- the key hotel metric -- to increase 10% in 2007, and 12% in 2008. The company also has a strong presence in higher-margin upscale lodging, a superior global footprint to guard against regional economic downturns, and favorable brand attributes ... the latest publicity regarding Ms. Hilton, notwithstanding, of course.

Continue reading Enough with Paris, the heiress: How does Hilton rate?

Enough with Paris, the heiress: How does Hilton rate? originally appeared on BloggingStocks on Wed, 13 Jun 2007 09:45:00 EST. Please see our terms for use of feeds.

When you want to build a house, you look in the phone book for a local contractor. When you want to build a stylish facility, the list of firms that can help you is a short one. There is a 113-year old outfit in Framingham, Massachusetts that invariably occupies a position near the top of the list.

Perini Corporation (NYSE: PCR) is a leading construction services company offering diversified general contracting, construction management and design/build services to private clients and public agencies worldwide. The firm is well known for its casino and hotel projects, but is also active in the design and construction of schools, health care facilities, entertainment facilities and sports complexes. Its civil division builds and maintains highways, subways, and airports. Clients include Harrah's Entertainment (NYSE: HET), Hilton Hotels (NYSE: HLT), Marriott International (NYSE: MAR), Sears Holdings (NASDAQ: SHLD), Honeywell International (NYSE: HON), American Express (NYSE: AXP) and Alcatel-Lucent (NYSE: ALU).

The company surprised the Street earlier in the month, when it reported Q1 EPS of 84 cents and revenues of $987.4 million. Analysts had been expecting 58 cents and $947.2 million. Management also guided FY07 EPS to $2.40-2.60 ($2.17 consensus) and FY07 revenues to $4.0-4.2 billion ($3.98B consensus). The COO cited a near-record backlog of $8.6 billion for the favorable outlook.

Continue reading Perini: Handling big construction

Perini: Handling big construction originally appeared on BloggingStocks on Tue, 22 May 2007 13:31:00 EST. Please see our terms for use of feeds.

Starwood CEO checks out early originally appeared on BloggingStocks on Mon, 02 Apr 2007 11:47:00 EST. Please see our terms for use of feeds.

1. Canada
2. Mexico
3. U.K.
4. Japan
5. Germany
6. France
7. South Korea
8. Australia
9. Italy
10. Brazil

U.S. tourism down by 60 million visitors since 9/11 originally appeared on BloggingStocks on Mon, 26 Mar 2007 10:13:00 EST. Please see our terms for use of feeds.

The Hilton Hotels Corporation (NYSE: HLT) has unveiled a ten year plan that shows its intention to continue aggressive expansion in world markets, especially in the hot economies of India and China. The plan calls for Hilton to build a thousand new hotels in North America and another thousand worldwide, adding to the 2,800 they currently own. Hilton currently offers almost half-a-million beds in 80 countries under a variety of names reflecting different price points, from Hilton to Embassy Suites, Hampton, Doubletree, and more.

The company plans include expanding top-tier hotels under the Waldorf-Astoria and Conrad brands in places such as Thailand and Saudi Arabia. Mid-priced Hampton and Hilton Garden Inn brands will be pushed in North America, taking advantage of their lower development costs.

The company will affiliate with DLF in India to open 50 or more locations with that country. In China, they plan to work with RREEF and H&Q Asia Pacific to build 20 or more hotels.

This expansion program is already well under way, with over 750 hotels currently in development. Hilton properties will open in four new markets this year: Portugal, Poland, Ukraine and Russia.

Hilton's 10-year plan originally appeared on BloggingStocks on Wed, 07 Mar 2007 14:52:00 EST. Please see our terms for use of feeds.