Continue reading Closing Bell: Health Care Doesn't Kill the Bulls (C, SOMX, NOVL, PALM, T, AIG, NBG)

Closing Bell: Health Care Doesn't Kill the Bulls (C, SOMX, NOVL, PALM, T, AIG, NBG) originally appeared on BloggingStocks on Mon, 22 Mar 2010 16:20:00 EST. Please see our terms for use of feeds.

Continue reading Closing Bell: A directionless win... sort of (ETFC, EK, TM, VG, WSM)

Closing Bell: A directionless win... sort of (ETFC, EK, TM, VG, WSM) originally appeared on BloggingStocks on Wed, 26 Aug 2009 16:00:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• Lehman initiated the Retail Hardlines Sector with a Neutral. The firm initiated coverage of Home Depot (NYSE: HD) and Lowe's (NYSE: LOW) with Overweight ratings and Best Buy (NYSE: BBY), Bed Bath & Beyond (NASDAQ: BBBY) and Williams Sonoma (NYSE: WSM) with Equal Weight ratings.
  
• Oppenheimer initiated Aventine Renewable (NYSE: AVR), Pacific Ethanol (NASDAQ: PEIX) and VeraSun Energy (NYSE: VSE) with Perform ratings. The firm is cautious on the industry due to higher feedstock costs.
  
• UBS initiated Interpublic Group (NYSE: IPG) and Omnicom Group (NYSE:OMC) with Buy ratings and an $11 target and $62 target, respectively. The firm views valuation as attractive.

• Morgan Stanley assumed coverage of International Flavors (NYSE: IFF) with an Overweight rating.
  
• Wachovia initiated CGI Group (NYSE: GIB) with a Market Perform rating.
  
• Leap Wireless (LEAP) was initiated at RBC Capital with a Sector Perform rating and $55 target.

Analyst initiations: U.S. retail hardlines, biofuels, IPG and OMC originally appeared on BloggingStocks on Fri, 25 Apr 2008 11:21:00 EST. Please see our terms for use of feeds.

During summer and winter breaks from college, I used to work in a Williams-Sonoma, Inc (NYSE: WSM) store in my local mall. As a moderately eloquent speaker and the only guy in the joint, I managed to make quite a few sales, particularly among the key "25-40 year old, vaguely unsatisfied married female" demographic that made up most of the store's customers. One day, as my father waited for me to get off work, he watched me talk a wealthy, sour-faced housewife into buying a $49 grape drainer. Shaking his head at my salesmanship, he wondered aloud how I could convince someone to shell out a pocketful of cash for what was essentially a porcelain bowl with holes in the bottom. I couldn't really answer him and, to this day, I wonder how Williams-Sonoma manages to market its wares, many of which are amazingly useless.

In the fourth quarter of 2007, Williams-Sonoma's profit rose almost 3%, but its first-quarter same-store 2008 profits are expected to fall by between 6% and 8.5%. The store is blaming its flagging sales on the real-estate slump. While it seems reasonable to expect that people would be disinclined to buy home goods when they're having a hard time covering their mortgage payments, Williams-Sonoma is missing the big picture. In addition to its position as a major player in the home decor market, W-S is also a luxury brand store and a narrow-focus mall retailer. Both of these types of stores are facing serious problems in the current economy, one for its inflated prices and the other for its lack of diversity. Consumers looking for kitchen implements are probably inclined to go to Lechters, which is a lot cheaper, or Wal-Mart and Target, both of which have a much wider selection of merchandise. If Williams-Sonoma wants to weather this storm, it should probably follow the lead of its Pottery Barn subsidiary and start cutting its prices. In the current economy, it's hard to imagine someone shelling out $49 for a grape drainer!

A recipe from Williams-Sonoma's recession cookbook originally appeared on BloggingStocks on Fri, 28 Mar 2008 18:45:00 EST. Please see our terms for use of feeds.

Gap Stores (NYSE: GPS) is expected to report EPS on November 21. GPS December option implied volatility of 41 is above its 26-week average of 32 according to Track Data, suggesting larger price risk.

Williams-Sonoma (NYSE: WSM), a home-furnishings retailer, is expected to report Q3 EPS of 24 cents on November 15. RBCM says, "Macros very difficult; too soon for longs, but scarcity value could increase." WSM November 30 straddle is priced at $2.80. WSM December option implied volatility of 55 is above its 26-week average of 38 according to Track Data, suggesting larger price fluctuations.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Option update 11-14-07: At two-year high, Gap (GPS) volatility up ahead of earnings originally appeared on BloggingStocks on Wed, 14 Nov 2007 08:53:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• FTN Midwest initiated shares of Ethan Allen Interiors Inc (NYSE: ETH), Pier 1 Imports (NYSE: PIR) and Bed Bath & Beyond Inc (NASDAQ: BBBY) with Neutral ratings and Williams-Sonoma Inc (NYSE: WSM) with a Buy rating.

• BMO Capital started Bronco Drilling Co (NASDAQ: BRNC), Pioneer Drilling Co (AMEX: PDC) and Union Drilling, IncNASDAQ: UDRL) with Outperform ratings.

• CIBC started Chemtura Corp (NYSE: CEM) with a Sector Underperformer rating and $11 target on valuation.

• C.E. Unterberg started Altus Pharmaceuticals Inc (NASDAQ: ALTU) with a Buy rating and $12 target, believing the company's efforts to develop the first juvenile formulation of a pancreatic enzyme will be a key growth driver.

Analyst initiations 4-27-07: BBBY, ETH, PIR and WSM originally appeared on BloggingStocks on Fri, 27 Apr 2007 11:26:00 EST. Please see our terms for use of feeds.