Analyst Upgrades

• Sapient (SAPE) to outperform from market perform at Wells Fargo.
• Kroger (KR) to buy from neutral at UBS.
• Harman (HAR) to overweight from neutral and Deutsche Bank (DB) to neutral from underweight at JPMorgan.
• Savient (SVNT) to outperform from market perform at JMP Securities.
• LabCorp (LH) to buy from hold at Deutsche Bank.
• Optimer Pharm (OPTR) and Landstar System (LSTR) to outperform from neutral at RW Baird.
• Essex Property Trust (ESS) to buy from neutral at Janney Capital.
• Tyson Foods (TSN) to neutral from sell at Goldman.
• Host Hotels (HST) to outperform from sector perform at RBC Capital.
• SPX Corp. (SPW) to outperform from market perform at FBR Capital.

Continue reading Analyst Calls: AXP, COF, DB, DFS, DNDN, HST, KR, ROC, SAFM, STJ, TSN ...

Analyst Calls: AXP, COF, DB, DFS, DNDN, HST, KR, ROC, SAFM, STJ, TSN ... originally appeared on BloggingStocks on Wed, 01 Dec 2010 12:00:00 EST. Please see our terms for use of feeds.

The dealmaking for mobile location-based services (LBS) companies heated up this week. First, high-end audio maker, Harman (HAR), agreed to buy Aha Mobile. The company essentially turns your smartphone into an in-vehicle infotainment system.

And today, we got another deal: Motorola (MOT) purchased Aloqa, which develops software to stream event and digital coupons to smartphones.

Continue reading Motorola Strikes a Deal for Location-Mobile Provider Aloqa

Motorola Strikes a Deal for Location-Mobile Provider Aloqa originally appeared on BloggingStocks on Thu, 16 Sep 2010 12:40:00 EST. Please see our terms for use of feeds.

Harman International (HAR) is starting to sound like an interesting value play.

Harman has seen its stock price cut nearly in half during the past month -- falling from a high of $53.36 at the end of April to around $33 -- but it seems to have found some recent support.

Plus, it must be doing something right because it was the lucky recipient of a bullish review in Barron's this weekend.

Continue reading Harman Sounds Like a Value Play

Harman Sounds Like a Value Play originally appeared on BloggingStocks on Tue, 01 Jun 2010 12:40:00 EST. Please see our terms for use of feeds.

Analyst Upgrades

• Baird upgraded Air Products (APD) to outperform from neutral on valuation following the sell-off after the company's bid for Airgas (ARG). The firm has an $89 price target on shares.
• JPMorgan upgraded Peabody Energy (BTU) to overweight from neutral as it believes the company is well positioned for 2010. The firm has a $50 price target on shares.
• Jefferies raised Adobe (ADBE) to buy from hold and has a $40 target on the stock. The firm believes concerns over the future of Flash are overblown and that shares of Adobe are attractive. Additionally, the firm expects CS5 to have a "decent" product cycle.
• Dell (DELL) was upgraded to buy from neutral at BofA/Merrill.
• SXC Health Solutions (SXCI) was upgraded to buy from hold at ThinkEquity.
• Harman (HAR) was upgraded to neutral from underperform at Credit Suisse.

Continue reading Analyst Upgrades, Downgrades and Initiations: ADBE, APD, BTU, C, DELL, PKY, SFY, WEC ...

Analyst Upgrades, Downgrades and Initiations: ADBE, APD, BTU, C, DELL, PKY, SFY, WEC ... originally appeared on BloggingStocks on Wed, 10 Feb 2010 11:20:00 EST. Please see our terms for use of feeds.

• Baird upgraded Con-Way (NYSE: CNW) and Old Dominion (NASDAQ: ODFL) to Outperform from Neutral due to the benefits of a likely bankruptcy of YRC Worldwide (NASDAQ: YRCW). Old Dominion's target was raised to $40 from $26 and Con-Way's was raised to $42 from $22.
• Citigroup upgraded Pride International (NYSE: PDE) to Hold from Sell as it believes higher valuation levels are warranted with the upcoming spin-off of Seahawk Drilling. Citi raised its target on shares to $25 from $18.
• Jesup & Lamont upgraded FedEx (NYSE: FDX) to Buy from Hold with a $63 target as it believes the worst is largely behind the company.
• Hewitt Associates (NYSE: HEW) was upgraded to Neutral from Underweight at JPMorgan.
• ArvinMeritor (NYSE: ARM) was upgraded to Buy from Neutral at Goldman.
• Abercrombie & Fitch (NYSE: ANF) was upgraded to Buy from Neutral at SunTrust.

Continue reading Analyst upgrades, downgrades and initiations: ANF, FDX, IBM, RBS, SNDK, T

Analyst upgrades, downgrades and initiations: ANF, FDX, IBM, RBS, SNDK, T originally appeared on BloggingStocks on Thu, 18 Jun 2009 11:40:00 EST. Please see our terms for use of feeds.

Goldman Sachs downgraded Daimler (NYSE: DAI) to Neutral from Buy, according to MarketWatch.

Citigroup downgraded Genentech (NYSE: DNA) to Hold from Buy, according to Briefing.com. The news service also writes that UBS downgraded Johnson & Johnson (NYSE: JNJ) to Hold from Buy.

Priceline.com (NASDAQ: PCLN) was raised to Buy at Citigroup, according to Briefing.com. The financial site also reports that Harman (NYSE: HAR) was cut to Neutral at Baird.

Early analyst calls: DNA, JNJ originally appeared on BloggingStocks on Fri, 15 Aug 2008 07:20:00 EST. Please see our terms for use of feeds.

For the private equity space, it's been a mixed bag this week. The good news is that the $17.1 billion acquisition of Harrah's Entertainment got done (the largest casino deal in history). The buyers included TPG and Apollo Global Management LP.

But there was some bad news too -- it looks like Blackstone (NYSE: BX)'s proposed buyout of Alliance Data Systems (NYSE: ADS) is on the rocks.

So, in this environment, it's understandable that Wall Street is jittery with buyout deals. Just look at the pending buyout of Clear Channel Communications (NYSE: CCU).

Continue reading Clear Channel buyout -- even more more static

Clear Channel buyout -- even more more static originally appeared on BloggingStocks on Tue, 29 Jan 2008 13:11:00 EST. Please see our terms for use of feeds.

Wall Street has its own brand of breaking up. There may not be 50 ways but there are at least two -- the easy way and the hard way. According to the New York Times, KKR and The Goldman Sachs Group (NYSE: GS) are splitting with Harman International (NYSE: HAR) the easy way while J.C . Flowers is taking the hard route to killing its deal with SLM Corp (NYSE: SLM).

The easy way, in the Harman case, is for the buyers to buy $400 million worth of Harman bonds instead of paying $8 billion to own the company. Under the new agreement, the buyout deal struck in April will be dissolved, with no litigation or payment of the $225 million termination fee. Instead, KKR and Goldman will buy bonds that can be exchanged for Harman shares at $104, below the $120-a-share price of the original offer -- but much higher than its current $85.87.

Harman gets some cash and saves face while KKR and Goldman get out of investing in a cratering company -- its earnings of 50 cents a share for the most recent quarter are expected to be less than half of the $1.02 analysts had forecast.

Continue reading Breaking up Wall Street Style: Harman (HAR) and SLM (SLM) deals die differently

Breaking up Wall Street Style: Harman (HAR) and SLM (SLM) deals die differently originally appeared on BloggingStocks on Tue, 23 Oct 2007 14:45:00 EST. Please see our terms for use of feeds.

Despite some improvement, the private equity folks are having some problems. Just take a look at the implosion of deals like Harman (NYSE: HAR). And, of course, major Wall Street banks are taking massive write-offs for problematic buyout loans.

Oh, and there's something else; that is, private equity firms also must deal with a possible tax hike. In fact, Senator Charles Schumer plans to introduce a bill on the matter according to Bloomberg.

Even if dealmaking slows down, a private equity surcharge could be a nice source of revenues. With current rates at only 15%, there is certainly lots of opportunity for Congress to soak.

Interestingly enough, Schumer is not too optimistic about his bill. That is, he thinks that President Bush will use his veto pen.

But, I have a feeling the tax issue won't go away. Simply put, it's just too big to ignore. And, no doubt, I'm sure private equity heavies are paying some big bucks for their tax advisers to gin up some creative strategies.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Sen. Charles Schumer wants to soak the private equity folks originally appeared on BloggingStocks on Wed, 03 Oct 2007 15:35:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• ING Group upgraded shares of BT Group (NYSE: BT) to Hold from Sell to reflect the company's more stable revenue trend and improving cash flow generation.
  
• Deutsche Bank upgraded shares of Luminent Mortgage Capital (NYSE: LUM) to Hold from Sell, as they believe the company's portfolio is beginning to stabilize and its liquidity has improved.
  
• Goldman upgraded Cognos Inc (NASDAQ: COGN) to Buy from Neutral following its Q2 report.
  
• Thor Industries (NYSE: THO) was raised to Sector Perform from Underperform at RBC Capital Markets. The firm's checks indicate strengthening backlog and lower promotional spending.
  
• Roth Capital believes Watson Pharmaceuticals (NYSE: WPI) is about to enter a growth phase with Paul Bisaro at the helm and is positive on Silodosin potential. The firm upgraded shares to Buy from Hold.

• Bank of the Ozarks (NASDAQ: OZRK) was upgraded to Buy from Neutral at B. Riley.
  
• Bear upgraded Harman International (NYSE: HAR) to Outperform from Market Perform.
  
• Goldman upgraded Packagaing Corporation (NYSE: PKG) and Smurfit-Stone Container (NASDAQ: SSCC) to Buy from Neutral.
  
• Friedman Billings raised Conseco Inc (NYSE: CNO) to Outperform from Market Perform.

Analyst upgrades: BT, LUM, COGN, THO and WPI originally appeared on BloggingStocks on Fri, 28 Sep 2007 11:00:00 EST. Please see our terms for use of feeds.

Bond market mending its wounded ways originally appeared on BloggingStocks on Fri, 28 Sep 2007 10:15:00 EST. Please see our terms for use of feeds.

Since the dog days of August, a chill has spread through the hallowed halls of private equity. $350 billion worth of leveraged buyout loans are sitting on the books of banks, looking for a home with investors. While one deal that was on the rocks, First Data's acquisition by KKR, managed to close, there are others, like J.C. Flowers' proposed $60 a share takeover of SLM Corp. (NYSE: SLM) which have fallen through.

As more and more deals go the way of Sallie Mae, you'll be hearing a lot more of the expression Material Adverse Change (MAC). MAC is a standard contract clause in a merger agreement which gives the acquirer the right to back out of a deal if there is a material adverse change -- an unexpected and permanent impairment in the value of the company. If an acquirer can successfully "call a MAC," it can get out of a deal without paying the breakup fee.

In the case of the SLM deal, J.C. Flowers announced it was backing out due to legislation signed by the president which makes the student lending business less attractive by cutting subsidies to student-loan providers, thus reducing Sallie Mae's profit prospects. In the case of KKR and The Goldman Sachs Group's (NYSE: GS) effort to welch on its proposed deal to acquire Harman International (NYSE: HAR), the MAC is an earnings report that came in lower than expected -- 93 cents instead of $1.22.

Continue reading Private equity freeze claims Sallie Mae (SLM) and Harman (HAR) deals -- who's next?

Private equity freeze claims Sallie Mae (SLM) and Harman (HAR) deals -- who's next? originally appeared on BloggingStocks on Thu, 27 Sep 2007 14:00:00 EST. Please see our terms for use of feeds.

Time can be the enemy of buyout deals. It gives the parties more time to think about things -- or get frustrated. Just look at what happened with the Harman International Industries, Inc. (NYSE: HAR) implosion.

But, in the case of the buyout of Clear Channel (NYSE: CCU), the deal somehow appears to be mostly complete (the process took about 10 months). That is, today the company announced that its shareholders approved the transaction. As a result, the company's buyers -- Bain Capital Partners, LLC And Thomas H. Lee Partners, L.P. -- will become the new owners of the radio powerhouse.

In fact, during the buyout process, Clear Channel increased the price tag two times. There was also another interesting feature added along the way; that is, the shareholders have the right to roll over some of their equity into the private entity.

But, ultimately, the key takeaway is that radio has proven to be quite resilient. Despite competition from satellite providers and the Internet, the fact remains that traditional radio continues to be a big part of people's lives -- and more to the point, a nice cash-cow business.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Listen to this: Clear Channel (CCU) finally gets a buyout deal originally appeared on BloggingStocks on Tue, 25 Sep 2007 15:55:00 EST. Please see our terms for use of feeds.

KKR is known as a tough negotiator. After all, the firm walked from its $8 billion deal for Harman International (NYSE: HAR), which crushed the stock by 24% on Friday.

But, as for the First Data Corp. (NYSE: FDC) transaction, KKR is certainly jazzed. Despite talk that financing had dried up, it now looks like the debt offering is oversubscribed -- at least for a $5 billion tranche (this is according to a story in Bloomberg.com). Although, to generate more demand, there was a 4% discount on the notes.

But for the most part, it looks like things should pan out and based on the stock price of First Data, Wall Street also agrees.

Does this mean things will get easier for other deals? To some degree, I think the answer is yes. Liquidity is coming back into the system and fear is dissipating.

However, I think there will still be some carnage, especially for those deals that may not have the strong fundamentals of First Data or that were aggressively priced and structured.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

First Data (FDC) deal lookin' good originally appeared on BloggingStocks on Sun, 23 Sep 2007 11:40:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• Kohlberg Kravis Roberts & Co and Goldman Sachs Group (NYSE: GS) may not go through with their expected buyout of Harmon International Industries (NYSE: HAR), according to the Wall Street Journal, as a result of the credit crisis and lower results at Harmon.
• The Financial Times reported that Chinese PC maker Lenovo Group (OTC: LNVGY) is open to acquiring companies, but buying companies is not a top priority, according to Lenovo CEO Bill Amelio.

• The Guardian reported that Google Inc (NASDAQ: GOOG) is considering a move into the U.K. wireless market after regulator Ofcom proposed taking back over a third of the mobile phone spectrum that Vodafone Group (NYSE: VOD) and O2 have been using for 22 years to auction it for new entrants.
• From BusinessWeek's "Inside Wall Street" column:
  
• How much higher can Apple Inc (NADSAQ: AAPL) go? Of the 27 analysts who track Apple, 23 still recommend buying it, 4 rate it a hold, while none advise selling it.
• A week after Boone Pickens disclosed a 9.9% stake in InterOil Corporation (NYSE: IOC), the stock gushed from $28 on Aug. 8 to $40.75 on Aug. 13, the day the oil-and-gas explorer disclosed it found evidence of oil in its Elk-2 well in Papua New Guinea.
  
• Bioenvision Inc (NASDAQ: BIVN), the small biotech that Genzyme Corporation (NASDAQ: GENZ) agreed to acquire in May at $5.60 a share, may not close on the deal unless Genzyme raises its offer.

Newspaper wrap-up: Google may enter U.K. wireless space originally appeared on BloggingStocks on Fri, 21 Sep 2007 09:15:00 EST. Please see our terms for use of feeds.

Before the bell: Stocks futures higher after strong earnings yesterday originally appeared on BloggingStocks on Fri, 21 Sep 2007 07:39:00 EST. Please see our terms for use of feeds.

This will begin to seem like a broken record now.

KKR and Goldman Sachs (NYSE: GS) are close to either renegotiating or walking away from a deal to buy Harman International (NYSE: HAR), the big audio components company, according to the Wall Street Journal because of "a credit crunch and lackluster financial results from Harman."

Most of the buyout deals have clauses that say that if a company's fortunes go through a "material change" that buyers can back out. But, operating income at Harman in the June quarter was more than $81 million on revenue of $911 million. Not as good as some quarters in the past, but hardly a disaster.

The buyout does have a $225 million break-up fee, but Harman's board is likely to insist that KKR and Goldman stay in the deal The stock trades at about $112 a share which is well below the $125 offer. Harman traded under $100 before the offer to take the company private was made.

Although KKR and Goldman could have their reputations harmed by walking away from a deal, they may feel that it is better to face this kind of setback than to loose billions of dollars on a company that they no longer believe can cover the debt that a buyout would create. But, Harman's board and management are unlikely to be satisfied with that explanation. It is not much to take to their shareholders.

If the transaction falls apart, the odds are very high that Harman will take the two big financial firms to court. And, it may be only the first case among many brought on by a tough credit environment where risk is no longer popular.

Douglas A. McIntyre is a partner at 247wallst.com.

As Goldman (GS) and KKR prepare to walk, Harman deal in trouble originally appeared on BloggingStocks on Fri, 21 Sep 2007 04:22:00 EST. Please see our terms for use of feeds.

M

• Banc of America downgraded shares of Dendreon Corp (NASDAQ: DNDN) to Sell from Neutral following the FDA's request for additional clinical data for Provenge.

• HSBC cut Whole Foods Market (NASDAQ: WFMI) to Underweight from Neutral after the second quarter miss.

• BMO Capital downgraded Rio Tinto plc (NYSE: RTP) to Underperform from Market Perform based on valuation.

• El Paso Corp (NYSE: EP) was cut to Sell from Buy at Matrix after the company's weak operating performance.

• Merriman downgraded shares of Oplink Communications (NASDAQ: OPLK) to Sell from Neutral based on concerns over the OCP acquisitions and inventory...

• 24/7 Real Media, Inc (NASDAQ: TFSM) was cut to Hold from Buy at Jefferies.

• Credit Suisse downgraded shares of RadioShack Corp (NYSE: RSH) to Neutral from Outperform.

• Bear Stearns cut Harman International Industries (NYSE: HAR) to Peer Perform from Outperform.

• Piper Jaffray downgraded shares of Cache, Inc (NASDAQ: CACH) to Market Perform from Outperform.

• Restoration Hardware, Inc (NASDAQ: RSTO) was cut at Caris to Average from Above Average.

Analyst downgrades 5-10-07: CACH, RSH, RTP and WFMI originally appeared on BloggingStocks on Thu, 10 May 2007 11:12:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• BWS Financial downgraded Amazon.com Inc (NASDAQ: AMZN) to Hold from Buy citing valuation.

• Jefferies cut WellCare Health Plans Inc (NYSE: WCG) to Underperform from Hold and lowered their target to $69 from $80 as the firm believes higher-than-expected medical costs in Georgia will put significant pressure on earnings.

• Citigroup downgraded Agrium Inc (NYSE: AGU), CF Industries Holdings, Inc (NYSE: CF), Potash Corp (NYSE: POT) and Terra Industries Inc (NYSE: TRA) to Hold from Buy given the year-to-date share appreciation, as their analysis suggests near-term positive earnings revisions are near a peak and should slow going forward. Citigroup remains positive on the fertilizer industry over the long-term.

• Keefe Bruyette downgraded Federated Investors, Inc (NYSE: FII) to Market Perform from Outperform citing the potential impact from Bank of New York Co (BK)/ Mellon Financial Corp (MEL) transactions.

• Jefferies cut Amerigroup Corp (NYSE: AGP) to Underperform from Hold with a $25 target.

• Stephens downgraded Pacer International, Inc (NASDAQ: PACR) to Equal Weight from Overweight.

• Atlantic Equities downgraded Adobe Systems Inc (NASDAQ: ADBE) to Neutral from Overweight.

• Harman International Industries Inc (NYSE: HAR) was taken down to Hold from Buy at Gabelli.

Analyst downgrades 4-30-07: ADBE, AMZN, AGP and POT originally appeared on BloggingStocks on Mon, 30 Apr 2007 11:07:00 EST. Please see our terms for use of feeds.

As Tom Taulli posted yesterday, Harman International Industries, Inc. (NYSE: HAR) is in play. According to the New York Times [registration required], KKR and The Goldman Sachs Group, Inc. (NYSE: GS) announced an $8 billion bid -- a 17% premium over Wednesday's closing price -- to take HAR partially private.

And there's the rub. I mean stub -- because rather than take the entire company private, as is the normal procedure, the proposed takeover would leave up to 27% of the equity traded publicly (e.g., the stub).

There are three reasons this deal caught my eye:

• I think the company makes great speakers -- a nice pair of which came with my computer.
• I recommended HAR in my newsletter last September 30, and it went from $83.44 to $99.91 by the end of the year, a 20% gain.
• As I posted recently, CEOs with short tenures have gotten some nice going away presents. This includes HAR -- which fired its CEO, Doug Pertz, in August 2006 after four months in office -- paying him $3.8 million to go away.

Continue reading Harman's buyout offer: a sound investment?

Harman's buyout offer: a sound investment? originally appeared on BloggingStocks on Fri, 27 Apr 2007 14:05:00 EST. Please see our terms for use of feeds.