MDC posts
FeedPosted Nov 17th 2008 12:42PM by Eric Buscemi (RSS feed)
Filed under: Analyst reports, Analyst upgrades and downgrades, Dell (DELL), McDonald's (MCD), Walt Disney (DIS), Nokia Corp. (NOK), Alcoa Inc (AA), AutoZone Inc (AZO), Gap Inc (GPS), Analyst initiations
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Analyst upgrades:
- UBS upgraded McDonald's (NYSE:MCD) to Buy from Neutral based on expectations the it can deliver on 2009 EPS expectations and potential for accelerating share gains.
- Bernstein upgraded Nokia (NYSE:NOK) to Outperform from Underperform on valuation following the company's profit warning. Merrill upgraded shares to Buy from Neutral to reflect valuation and Nokia's new product portfolio. Shares were also upgraded to Hold from Sell at WestLB.
- B. Riley raised UCBH Holdings (NASDAQ:UCBH) to Buy from Neutral to reflect the improved valuation and the company's stronger capital position provided by the US Treasury investment.
- Parexel (NASDAQ:PRXL) was upgraded to Buy from Hold at Jefferies.
- CTS Corp (NYSE:CTS) was lifted to Neutral from Underweight at JP Morgan.
- Hospitality Properties (NYSE:HPT) was upgraded to Equal Weight from Underweight at Morgan Stanley.
Analyst downgrades:
- Soleil downgraded Disney (NYSE:DIS) to Hold from Buy to reflect the weakening macro-economic outlook and their belief consensus estimates may be too high. The firm lowered their target to $23 from $40.
- Merrill downgraded Dell (NASDAQ:DELL) to Neutral from Buy on expectations PC sales will decline next year amid the slowing economy. The firm lowered Dell's target price to $13 from $22.
- Jefferies cut MDS Inc (NASDAQ:MDZ) to Hold from Buy to reflect slowing demand and a lack of catalysts to unlock the company's assets. The firm lowered their target to $10.50 from $15.
- Alcoa (NYSE:AA) was lowered to Neutral from Buy at UBS.
- Tesco PLC (Other OTC:TSCDY) was downgraded at JP Morgan to Underweight from Neutral.
- Merrill downgraded SAP AG (NYSE:SAP) to Neutral from Buy.
- Goldman added Altera (NASDAQ:ALTR) to the Conviction Sell List.
Analyst initiations:
- Citigroup thinks AutoZone (NYSE:AZO) will benefit from the slowdown in car sales and thinks the recent pullback is overdone. Shares were initiated with a Buy rating and $146 target.
- Citigroup also believes Advance Auto Parts (NYSE:AAP) will benefit from the slowdown in car sales and started shares with a Buy rating and $35 target.
- After Sunway (OTCBB:SUWG) reported higher than expected revenue, Roth Capital thinks the company is poised for substantial growth, but the firm thinks its remaining warrants may keep the shares trading at a modest valuation for a significant amount of time. The firm started shares with a Hold rating and $3.60 target.
- Mechel Steel (NYSE:MTL) was initiated with a Neutral rating at Merrill Lynch.
- China Life Insurance (NYSE:LFC) was assumed with a Buy rating at UBS.
- Gap (NYSE:GPS) was started at Cowen with a Neutral rating.
Posted Jul 30th 2007 7:50PM by Jon Ogg (RSS feed)
Filed under: Analyst reports, ,
On tonight's MAD MONEY on CNBC, Jim Cramer outlined what he sees as the worst case scenario for stocks. He said he isn't of the mindset that this will happen, but he wants you to know what to do in a gloom & doom scenario, and what the doomsday guys are using for their ammo to spook the market.
The 3 groups in trouble are home builders, banks and mortgage brokers, and brokerage firm stocks. Here are the 'worst case scenarios' out there:
Home builders are a total mess, and the only one he thinks isn't a disaster is
MDC Holdings (NYSE:
MDC). He even thinks some home builders could go under. South Florida, Phoenix, California are all in trouble and way overbuilt.
Countrywide Financial Corp. (NYSE:
CFC) is the only good lender out there and is at least honest about exposure and how bad some of it is. The worst case is that 50% of home buyers could walk away. Cramer reminds us that he doesn't really think that will happen, but that is the worst case scenario.
Continue reading Cramer's playbook for an extreme bearish situation ... just in case
Posted Jul 23rd 2007 7:00AM by Kevin Kelly (RSS feed)
Filed under: Columns, Options, Economic data, Housing
This week is a very big week for housing stocks. Wednesday, Wall Street will hear the home sales report from the National Association of Realtors.
According to the AP, the street is looking for 5.85 million homes resold in June versus 5.99 million resales in May. On Thursday, the Commerce Department will report new home sales. Again, the consensus is looking for a decline from May's figures.
I think that the subprime blow-up alongside falling real estate prices has forced the market to become very cautious in these names, and rightfully so. The uncertainty in earnings and book value writedowns to come has resulted in a situation where the risk may already be priced in. As a result, I tend to believe that any bad news from either numbers report is already priced in, and the stocks won't get killed if the numbers are ugly. But the entire sector will probably move very strongly if either of the numbers come in above consensus.
Traders might be interested in playing this number by picking up calls in their favorite home building stocks or a home building ETF. Keep in mind, superstar hedge fund Moore Capital owns
Beazer Homes (NYSE:
BZH) while Monish Pabrai and Greenlight Capital own
MDC Holdings (NYSE:
MDC). If you don't like any particular home builder, but believe in the priced-in thesis, you could pick up the
Streettracks Home building ETF (AMEX:
XHB). Best case (a good number from either report), the options will probably move rather significantly, worst case (two bad reports) I don't think they will get hit too hard.
Posted Jul 16th 2007 4:40PM by Kevin Kelly (RSS feed)
Filed under: Microsoft (MSFT), General Electric (GE), Columns
Greenlight Capital is a very interesting and successful hedge fund ran by value investing superstar David Einhorn. The fund has annualized returns at 27% per year for the last 10 years. Einhorn's investment style is especially interesting because he is not afraid to make large, focused bets and because he specializes in special situations, specifically spinoffs.
Focus investing is a concept which has recently seen a resurgence due to the success of Mohnish Pabrai and many other focused hedge funds such as Greenlight. As I recently covered
here, spinoff investing is a compelling method of investing which I consider to allow for "structural undervaluation."
Interestingly, Einhorn isn't a one horse pony when it comes to investing. He's also a very talented poker player. In fact, he
came in 18th (of 8,773) in the 2006 World Series of Poker for which he took home almost $660,000. This is pertinent because many people believe there is a correlation between excelling in trading/investing and doing well in poker.
Continue reading Piggyback investing: Greenlight Capital
Posted Jan 23rd 2007 11:23AM by Kevin Shult (RSS feed)
Filed under: Before the bell, Analyst upgrades and downgrades, Good news, D.R.Horton (DHI), Toll Brothers (TOL), Under Armour'A' (UA), , Urban Outfitters (URBN), Vonage Holdings (VG)
MOST NOTEWORTHY: Under Armor Inc (NYSE:
UA) and Cardinal Health Inc (NYSE:
CAH) are today's most notable upgrades:
- Credit Suisse upgraded Under Armor Inc (NYSE: UA) to Outperform from Neutral with a $65 target and believes that the company is emerging as one of the premier global athletic brands.
- JMP Securities upgraded shares of Cardinal Health Inc (NYSE: CAH) to Outperform from Market Perform to reflect their expectation for accelerated earnings growth over the next three years.
OTHER UPGRADES:
- Friedman, Billings upgraded shares of Urban Outfitters Inc (NASDAQ: URBN) to Outperform from Market Perform to reflect positive momentum in URBN's core division, inventory control and easy upcoming comps.
- Stanford upgraded shares of Vonage Holdings (NYSE: VG) to Hold from Sell on valuation.
- Goldman Sachs upgraded the US Homebuilding Sector to Neutral from Sell saying the worst may be behind the group, but fundamentals remain troubling. The analyst said the next meaningful data will be from the Spring selling season, 6-8 weeks away.
- Goldman upgraded D.R. Horton Inc (NYSE: DHI), MDC Holdings Inc (NYSE: MDC) & Toll Brothers Inc (NYSE: TOL) to Buy from Neutral due to lower-risk at this point in the cycle. The Ryland Group Inc (NYSE: RYL) was upgraded to Neutral from Sell.
Analyst summaries provided by
TheFlyOnTheWall.com (subscription required).
Posted Jan 4th 2007 10:01AM by Eric Buscemi (RSS feed)
Filed under: Industry, Centex Corp (CTX), D.R.Horton (DHI), KB HOME (KBH), Lennar Corp'A' (LEN)
Bill Miller, the famed Legg Mason fund manager, was on television last week. He said he is long on housing stocks.
In Barron's
Up and Down Wall Street column (subscription required), Doug Kass of Seabreeze Partners said he was short housing stocks - no big surprise there. Kass referred to order cancellation as the reasoning for his bearishness.
Typically, publicly traded homebuilders have cancellation rates of 15% of orders. However, that number has jumped considerably. Cancellation rates of publicly traded homebuilders:
- Centex (NYSE: CTX) - 37%
- DR Horton (NYSE: DHI) - 40%
- KB Homes (NYSE: KBH) - 53%
- Lennar (NYSE: LEN) - 31%
- Pulte Homes (NYSE: PHM) - 36%
- Beazer (NYSE: BZH) - 57%
- Hovnanian (NYSE: HOV) - 35%
- MDC Holdings (NYSE: MDC) - 49%
- Standard Pacific (NYSE: SPF) - 50%
These numbers (from the Barron's article) are so bad that the worst might be unfolding right now.
TheFly's advice, Miller tends to be too early and Kass is often too negative when the worst is already priced in the stocks. I'd say, start following these stocks again, expecting a bottom in the spring and early summer.
The most recent rally is mostly from an oversold condition. I'd wait for another correction and see where the industry fundamentals stand.
Most investors got slammed last year, down 50% or more in their investments. Didn't matter if they owned stocks or real estate, they got hammered. Many have to start over. And if they're near retirement, it's scary. Years of patient investing wiped out, gains that were made over a long time disappeared frighteningly fast.
Before the bell: Stocks ready to climb on hopes of continued low rates
Why do we have a weak dollar?
Holiday hiring slow for retailers