This morning, SNDK opened at $15.81. So far today the stock has hit a low of $13.83 and a high of $15.85. As of 12:15, SNDK is trading at $14.33, down $1.18 (-7.6%). The chart for SNDK looks neutral and S&P gives SNDK a 3 STARS (out of 5) hold ranking.
For a bearish hedged play on this stock, I would consider a November bear-call credit spread above the $25 range.
U.S. stock futures jumped higher Monday morning as investors gain more confidence in the different government actions taken to stabilize financial markets. Global shares advanced overnight following measures taken worldwide. Indeed, the three-month U.S. dollar LIBOR, a measure of the rate at which banks lend to each other, dropped to 4.06% from 4.42%.
Also, investors will be keeping an eye on Federal Reserve Chairman Ben Bernanke testimony before the House Budget Committee on the economic outlook and financial markets at 10:00 am EST, same time as the release of the September leading indicators.
As OPEC prepares for a production cut and oil rose to above $74 per barrel, earnings season on Wall Street continues in full swing this week:
Mattel Inc. (NYSE: MAT) reported third-quarter results this morning. Mattel's income rose, but not enough and it missed expectations.
Hasbro (NYSE: HAS) reported a 14% drop in third-quarter profit, but it beat expectations.
Halliburton (NYSE: HAL) swung to a loss in the third quarter, but managed to beat earnings expectations by a penny excluding charges. Revenue in the quarter rose 24%.
SanDisk (NASDAQ: SNDK), American Express (NYSE: AXP) and Texas Instruments (NYSE: TXN) report third-quarter results after the closing bell.
SanDisk (NASDAQ: SNDK) is recently trading at $22.65 in pre-open trading, above its close of $15.04. Samsung Electronics made public a $5.8 billion offer to purchase SNDK. SNDK, a supplier of flash storage cards, rejected Samsung's buyout proposal. SNDK overall option implied volatility of 79 is above its 26-week average of 63 according to Track Data, suggesting larger price movements.
Sempra Energy (NYSE: SRE), an energy company serving 29 million consumers worldwide, closed at $53.04. SRE October option implied volatility of 51 is above its 26-week average of 25 according to Track Data, suggesting larger price movement.
U.S. stock futures edged lower Wednesday morning after the government announced late Tuesday it would help save AIG. Investors may be relieved with the action on AIG and even the Federal Reserve decision not to move Tuesday, leaving room for a future rate cut, there are still big concerns about the state of financial markets. Investors today will also get data from on building permits and housing starts for the month of August. Oil rebounded today ahead of inventory report to over $93 a barrel.
The Federal Reserve said late Tuesday that it would to lend $85 billionAmerican International Group (NYSE: AIG), taking a 79.9% stake in the company. AIG shares are still sinking 30% in pre-market trading.
Meanwhile, as the government refused to help Lehman Brothers (NYSE:LEH) and the company filed for Chapter 11 Monday, Barclays PLC (NYSE: BCS) said it would buy Lehman's banking and capital markets business for $250 million. Barclays walked away from the deal a few days ago, perhaps waiting for a better price, in what many say BAC should have done with Merrill. BCS shares are up over 5% in pre-market trading, LEH's down over 25%.
Morgan Stanley (NYSE: MS) reported its quarterly earnings early to calm investors, posting better-than expected results. It seems the last two major independent investment houses, Morgan and Goldman Sachs (NYSE: GS), which also reported earning Tuesday, both posted third-quarter profits despite continued chaos in the financial markets.
J.P. Morgan Chase (NYSE: JPM) is reportedly in advanced talks to make a bid for Washington Mutual (NYSE: WM).
UST (NYSE: UST) is recently trading at $62.80 in pre-open trading, above its close of $54. Altria Group (NYSE: MO) is close to acquiring UST in a deal worth more than $10 billion, the New York Times reported. UST September option implied volatility is at 39; October is at 35 above its 26-week average of 27 according to Track Data, suggesting larger price movement.
ScanDisk (NASDAQ: SNDK) is recently trading at $17.49 in pre-open trading, above its close of $13.46. Samsung Electronics said it is looking at various ways of tying up with SNDK. SNDK, a supplier of flash storage cards says "SNDK periodically has conversations with multiple parties, including Samsung, regarding a variety of potential business opportunities. We evaluate all of these opportunities, but maintain a policy of not commenting on market rumors or speculation," SNDK September option implied volatility of 64 is above its 26-week average of 59 according to Track Data, suggesting larger price movements.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
U.S. stock futures are pointing to further declines following a rough session where the Dow plunged 344 points and ahead of the jobs report mostly feared to show weakness in the labor market. Non-farm payroll is expected to show a job loss of 75,000 but the unemployment remain unchanged. Meanwhile, international markets sank following U.S. markets. Also affecting mood this morning is Goldman's call to sell Merrill Lynch.
Goldman Sachs downgraded Merrill Lynch & Co. (NYSE: MER) to Sell from Neutral and added the firm to its conviction sell list. MER stock is plunging 6.6% in pre-market trading. Goldman said valuation and the likelihood of further write-downs are the reasons. Goldman also lowered its third-quarter EPS forecast to a loss of $5.75 a share.
SanDisk (NASDAQ: SNDK) shares are shooting up 26% in pre-market trading after Samsung Electronics said it may buy the flash memory maker. There are no concrete announcements or details as to price yet.
And at Boeing (NYSE: BA), the company continues to negotiate with labor leaders to avert an expensive strike it cannot afford. Negotiators and mediators are trying to work to avert the strike voted for by the union during the 48 hour extension.
Investors in shares of Fannie Mae (NYSE: FNM) and Freddie Mac (NYSE: FRE) went wild on speculation today that the government would put new funds into the mortgage agencies and wipe out common shareholders. The market was dragged down over 200 points at some point on a ripple of concerns about the financial sector:
Early in the day, the chance of a hurricane moving into the Gulf of Mexico pushed oil up and knocked equities down. Once the storm moved over Florida and away from deep-water rigs, oil went back down.
The trading was so bleak and depressing that most traders probably went home to watch the last few events of the Olympics. Those who stayed saw a few notable moves:
MOST NOTEWORTHY: Texas Instruments, SanDisk and Brocade were today's noteworthy downgrades:
Merrill Lynch downgraded shares of Texas Instruments (NYSE: TXN) to Neutral from Buy after the company reported lower-than-expected Q3 results due to concerns regarding elevated inventory levels and rising raw material and labor costs. Merrill lowered their target to $27 from $32.
Citigroup cut SanDisk (NASDAQ: SNDK) to Sell from Hold after the company reported a Q2 miss and offered lower-than-expected guidance. Citigroup lowered their target price to $14 from $20.
JMP Securities downgraded Brocade (NASDAQ: BRCD) to Market Perform from Outperform following the company's announcement to buy Foundry Networks, Inc. (NASDAQ: FDRY) for $19.25 per share.
OTHER DOWNGRADES:
ArthroCare (NASDAQ: ARTC) was lowered to Market Perform from Outperform at William Blair.
JP Morgan downgraded Assured Guaranty (NYSE: AGO) and Lenovo Group (LNVGY) to Neutral from Overweight.
Stocks futures are lower Tuesday morning, indicating U.S. stock markets will start on a down note following weak outlooks and disappointing financial results from several companies including Apple and American Express. With oil steady and no economic data out today, Wall Street will focus on earnings.
Apple Inc. (NASDAQ: AAPL) reported after the close Monday a record quarter that beat analyst estimates, posting a 31% surge in earnings. Mac and iPod sales satisfied investors, while iPhone sales were somewhat on the lighter side. What concerned investors most was the very weak guidance Apple gave, which was weak even by Apple's standards of lowballing. Other issues included margin squeeze and Jobs health. Apple shares were 10% lower in Frankfurt and premarket trading. American Express (NYSE: AXP), said late Monday its second-quarter results fell 38% due to the weakening economy. The company, which missed projections, caters to the more affluent who have good credit, and yet even this company felt the pains from the slowing economy. AmEx earned 56 cents per share compared to estimates of 83 cents per share. The company's stock tumbled AXP shares are down over 12% in premarket trading.
Also reporting Monday after the close were Merck & Co., Inc. (NYSE: MRK), Texas Instruments (NYSE: TXN) and SanDisk (NASDAQ: SNDK). MRK shares are down over 6.6% in premarket trading as the company said it would stop give guidance of results. TXN shares are also declining over 10.5% in premarket trading after it gave a disappointing forecast. SNDK shares are plunging over 16% in premarket trading after it swung to a Q2 loss, missing analyst estimates.
This morning we'll have another wave of earnings, and already started were DuPont and Wachovia.
MOST NOTEWORTHY: Wyeth, 3SBio Inc, Cellcom Israel and Partner Communications were today's noteworthy initiations:
Citigroup initiated Wyeth (NYSE: WYE) with a Hold rating and $49 target. The firm believes the upside potential from bapineuzumab is masking the company's unfavorable average EPS and revenue growth forecast versus the industry.
Piper believes 3SBio Inc (NASDAQ: SSRX) is the market leader in a largely underpenetrated EPO market in China and sees limited downside risk. Shares were assumed with a Buy rating and $12 target.
RBC Capital initiated Cellcom Israel (NYSE: CEL) and Partner Communications (NASDAQ: PTNR) with Outperform ratings and targets of $40 and $30, respectively. RBC said they have defensive appeal given their predictable earnings stream.
Citigroup downgraded Sandisk (NASDAQ:SNDK) to "hold: from "buy" according toBriefing.com. The news service also reports that Bank of America resumed coverage of Boeing (NYSE:BA) with a "neutral" rating.
Douglas A. Mcintyre is an editor at 247wallst.com.
MOST NOTEWORTHY: H&R Block, Talbots and SunPower were today's noteworthy upgrades:
Oppenheimer believes H&R Block (NYSE: HRB) has shown several catalysts over the past few months, most importantly the sale of its mortgage business. The firm, which upgraded shares to Outperform from Perform, believes the company's strong 2008 tax season will lead to future growth, and they think the stock can appreciate 20%+, as catalysts are not yet fully reflected in the stock.
Friedman Billings upgraded Talbots (NYSE: TLB) to Outperform from Market Perform as they believe the company has several sources of cash to avoid a liquidity crisis, charge card EPS contribution provides good visibility, improved merchandise margins, and better merchandising.
Credit Suisse raised SunPower (NASDAQ: SPWR) to Outperform from Neutral citing strength in Italy and other geographies.
OTHER UPGRADES:
Agco (NYSE: AG) was raised at Wachovia to Outperform from Market Perform.
UBS upgraded Metso Oyg (OTC: MXCYY) to Buy from Neutral.
JMP Securities upgraded SanDisk (NASDAQ: SNDK) to Market Perform from Underperform.
Stifel upgraded eBay (NASDAQ: EBAY) to Buy from Hold.
UBS downgraded Verizon (NYSE:VZ) from "buy" to "neutral" and took the same action with AT&T (NSYE:T) according toBriefing.com. The news service also reports that JMP upgraded Sandisk (NASDAQ:SNDK) to "market perform" from "underperform".
General Electric (NYSE: GE) was cut to Neutral from Outperform at JPMorgan, according to24/7 Wall St. The financial website also reports that Wendy's (NYSE: WEN) waised to Equal Weight from Underweight at Morgan Stanley.
Sandisk Corp. (NASDAQ: SNDK), which makes the small and sleek Sansa Portable Music Player, just bought MusicGremlin, a wireless music subscription business. That gives me hope that there is still life outside the cult of Apple Inc.'s (NASDAQ: AAPL) iPod. Sandisk's stock is down about 3% today, which is typical for the buying company.
I did once love my iPod Shuffle, which worked perfectly up until the day it stopped working at all. I made an appointment at the Apple store Genius Bar to try to fix it, reconfirmed before I headed over, then got there to find it would be at least a 90 minute wait. Did the same thing with the same results again, then gave up.
But I'm happy to report that my little Sansa is wonderful.
SanDisk (NASDAQ: SNDK - option chain) shares are dropping today after the company agreed to sell part of its capacity in a joint venture with Toshiba. For $1 billion, Toshiba will buy 30% of the manufacturing capacity in the joint venture. SNDK is getting trashed today as investors presumably don't like the idea of selling part of the company in the middle of an economic storm, when values might not be at their highest. SanDisk also reports its Q3 earnings after the close today, with analysts expecting a 27 cents per share loss. 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 SNDK.
U.S. stock futures jumped higher Monday morning as investors gain more confidence in the different government actions taken to stabilize financial markets. Global shares advanced overnight following 
SanDisk
U.S. stock futures edged lower Wednesday morning after the government announced late Tuesday it would help save AIG. Investors may be relieved with the action on AIG and even the Federal Reserve decision 
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