The Wall Street Journal also reported that the oil industry and some U.S. lawmakers are looking to end long-standing bans on domestic drilling put in place to protect areas that are environmentally-sensitive, fueled by concerns about global energy.
In an interview with the Financial Times, Citigroup Incorporated's (NYSE: C) former chairman and CEO Sandy Weill acknowledged that choosing Chuck Prince as his successor in 2003 turned out not to be the "right thing" for the company and was flawed. Instead of handing the job to Prince, Weill said the board should have fostered competition among the bank's top managers for the job.
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According to the Washington Post, MedImmune, a unit of drug giant AstraZeneca Plc (NYSE: AZN),settled with Genentech Inc (NYSE: DNA) a lawsuit over a patented component of its best-selling drug Synagis, which is aimed at preventing respiratory infections in infants. No details of the settlement were provided.
Gilead Sciences Inc. (NASDAQ: GILD) opened at $81.24. So far today the stock has hit a low of $80.48 and a high of $82.17. As of 10:45, GILD is trading at 81.85, up 1.21 (1.5%).
The stock made a strong push in early spring to reach the low 80's and a one year high of 84.47 in May. The US Government has recently been ramping up efforts to fight against any future potential flu pandemic, including awarding multi-million dollar contracts to Sanofi-Aventis (NYSE: SNY) and MedImmune (NASDAQ: MEDI) to increase their capacity to produce flu vaccines. GILD, maker of Tamiflu, could stand to benefit from such efforts as well. Recent technical indicators for GILD have been bullish but deteriorating, while S&P gives the stock a 4 STARS (out of 5) buy rating.
For a bullish hedged play on this stock, I would consider an August bull-put credit spread below the $70 range. GILD hasn't been below $70 since January and has shown support around $78 recently. This trade could be risky if the FDA finds trouble with one of GILD's drugs, but even if that happens, this position could be protected by the support around $70 combined with its 200 day moving average, which is currently at $71 and rising.
DISCLOSURE: Mr. Archer owns and/or controls diversified portfolios of long and short stock and option positions that may include holdings in companies he writes about. At publication time, Brent neither owns nor controls a position in GILD or MEDI. He does control a bullish hedged position in SNY.
MOST NOTEWORTHY: AstraZeneca plc (AZN), Aeroflex Inc (ARXX), Symantec Corp (SYMC), Chevron Corp (CVX) and Exxon Mobil Corp (XOM) were just some of today's noteworthy downgrades:
HSBC downgraded shares of AstraZeneca plc (NYSE: AZN) to Neutral from Overweight as the firm believes investors will have to wait until 2009 for the company to start benefiting from its strategy.
Aeroflexx Inc (NASDAQ: ARXX) was cut to Hold from Buy at Jefferies with a $14 target based on valuation.
Thomas Weisel downgraded shares of Symantec Corp (NASDAQ: SYMC) to Market Weight from Overweight citing a lack of near-term catalysts and increased risk from transitions in its business model.
Chevron Corp (NYSE: CVX) was removed from AG Edwards' Focus Portfolio. The firm believes Chevron offers less upside potential than other companies in the sector.
Exxon Mobil (NYSE: XOM) was downgraded to Hold from Buy on valuation and its balanced risk/reward profile...
OTHER DOWNGRADES:
Piper Jaffray cut Juniper Networks, Inc (NASDAQ: JNPR) to Market Perform from Outperform with a $20 target.
MOST NOTEWORTHY: CheckFree Corp (CKFR), Sprint Nextel Corp (S) and the semiconductor capital equipment sector were some of today's more noteworthy downgrades:
Piper Jaffray downgraded Checkfree Corp (NASDAQ: CKFR) to Market Perform from Outperform after transferring coverage of the payment processor company.
Sprint Nextel Corp (NYSE: S) was cut to Outperform from Strong Buy at Raymond James.
ThinkEquity cut Jones Soda Co (NASDAQ: JSDA) to Source of Funds from Buy based on valuation.
Goldman is now cautious on the biofuel sector, downgrading the group to Cautious from Neutral.
William Blair downgraded shares of Medimmune, Inc (NASDAQ: MEDI) to Market Perform from Outperform.
Credit Suisse downgraded shares of Big 5 Sporting Goods Corp (NASDAQ: BGFV) to Underperform from Neutral citing valuation.
Wachovia dropped Inkeepers USA Trust (NYSE: KPA) to Underperform from Outperform based on the acquisition from Apollo Investment Corp (AINV). Citigroup cut Inkeepers to Hold from Buy.
MOST NOTEWORTHY: Some of today's noteworthy downgrades were Medimmune Inc (MEDI), J.B. Hunt (JBHT), Lockheed Martin (LMT), Komag (KOMG) and Victor Corp (VICR):
Freidman Billings cut Medimmune inc (NASDAQ: MEDI) to Market Perform from Outperform on valuation. Prudential downgraded shares to Neutral from Overweight and recommended investors take profits in the company.
Lockheed Martin (NYSE: LMT) was removed from Goldman Sachs Conviction Buy List and prefers L-3 Communication (LLL) over the large-cap aerospace/defense company.
Komag Inc (NASDAQ: KOMG) was downgraded to Sell from Neutral at American Technology as they believe industry fundamentals have weakened and that the Seagate (STX) preannouncement will increase pricing pressure.
OTHER DOWNGRADES:
Stifel downgraded Mercantile Bank (NASDAQ: MBWM) to Hold from Buy at Stifel.
Soliel downgraded shares of Limited Brands (NYSE: LTD) to Hold from Buy.
Matrix USA cut DSP Group (NASDAQ: DSPG) to Strong Sell from Hold.
Brean Murray downgraded shares of Keithley Instruments (NYSE: KEI) to Sell from Buy with a $13 target following the company's Q2 pre-announcement.
MOST NOTEWORTHY: First Data Corp (FDC), Pinnacle Entertainment, Inc (PNK), Cephalon, Inc (CEPH) and Verint Systems Inc (VRNT) were some of today's downgrades:
UBS downgraded First Data Corp (NYSE: FDC) to Neutral from Buy following the acquisition by KKR.
Pinnacle Entertainment (NYSE: PNK) was cut to Hold from Buy at Matrix USA, as the firm believes post-hurricane reconstruction efforts are leading to significant capital expenditures, which limits upside.
Cephalon Inc (NASDAQ: CEPH) was removed from American Technology's Focus List with shares up 15% in three weeks as the approval of Nuvigil without a Black Box warning has passed.
JP Morgan cut shares of Verint Systems (NASDAQ: VRNT) to Underweight from Neutral, citing risks and costs associated from the Witness Systems' (WITS) acquisition.
OTHER DOWNGRADES:
Labor Ready, Inc (NYSE: LRW) was downgraded to Sell from Neutral at Goldman based on the slowdown in U.S. residential construction activity.
Broadcom Corporation (NASDAQ: BRCM) to hold a 10:30am press conference from Barcelona on 3GSM.
US and South Korea to hold Free-Trade Agreement talks from 2/11 to 2/14.
Tuesday February 13
Extreme entertainment earnings:
World Wrestling Entertainment (NYSE: WWE), conference call at 11am.
Playboy Enterprises (NYSE: PLA), conference call at 11am. Note that Playboy was recently downgraded by RBC Capital Markets and Sanders Morris Harris. Sanders Morris said the company will either issue guidance below consensus expectations or none at all on the call.
PDUFA date for Pfizer, Inc's (NYSE: PFE) Fesoterodine, a new drug candidate for the treatment of an overactive bladder.
Wednesday February 14
Garmin Limited (NASDAQ: GRMN) to report Q4 earnings, conference call at 11am.
MGM Mirage (NYSE: MGM) to report Q4 earnings, conference call at 11am.
PDUFA date for Acambis plc's (OTC: ACAMY) ACAM-2000, a smallpox vaccine derived from Dryvax, a first-generation vaccine used during the global eradication program.
PDUFA date for MedImmune Inc's (NASDAQ: MEDI) CAIV-T, an investigational intranasal, cold-adapted trivalent influenza vaccine.
Thursday February 15
Biogen Idec Inc (NASDAQ: BIIB) to report Q4 earnings, conference call at 8:30am. On February 2, JP Morgan recommended buying Biogen before its quarterly report, saying the Tysbari uptake should be better than current expectations.
Friday February 16
Jack in the Box Inc (NYSE: JBX) to hold annual shareholder meeting at 3pm.
MOST NOTEWORTHY: Wendy's International Inc (WEN) and NOVA Chemicals Corp (NCX) were today's most notable downgrades:
Matrix USA downgraded shares of fast-food restaurant Wendy's International Inc (NYSE: WEN) to Sell from Hold to reflect the company's slowing revenues, increasing expenses and valuation.
CIBC downgraded NOVA Chemicals Corp (NYSE: NCX) to Sector Underperformer from Sector Performer, lowering their target to $27.50 from $31 as they believe margins will be squeezed in 2008 once Middle Eastern supply begins to impact export markets.
OTHER DOWNGRADES:
Following the company's lower guidance, UBS downgraded National Semiconductor Corp (NYSE: NSM) to Neutral from Buy with a $25 target, while Citigroup downgraded National Semi to Hold from Buy with a $27 target.
Recent strength in Royal Caribbean Cruises Ltd (NYSE: RCL) forced Bank of America to remove it from their Top Pick list.
Jefferies downgraded shares of Triad Hospitals Inc (NYSE: TRI) to Hold from Buy pending the buyout.
JP Morgan downgraded shares of Altiris Inc (NASDAQ: ATRS) to Neutral from Outperform based on the Symantec (SYMC) acquisition.
Thomas Weisel downgraded Medimmune Inc (NASDAQ: MEDI) to Market Perform from Outperform on valuation.
Matrix USA downgraded Secure Computing Corp (NASDAQ: SCUR) to Sell from Buy on valuation.
MOST NOTEWORTHY: Symantec (NASDAQ:SYMC), Medimmune (NASDAQ:MEDI) and Ford (NYSE:F) were today's most notable upgrades:
Goldman Sachs added Symantec and Medimmune to its Conviction Buy List. Goldman sees potential Q3 upside for Symantec and believes the company has an attractive valuation.
Keybanc/McDonald upgraded Ford to Hold from Sell, saying it expects the rapid deterioration in earnings that occurred in 2006 to taper off as the company implements cost cuts and capacity rationalization actions.
OTHER UPGRADES:
Gilead (NASDAQ: GILD) was upgraded to Above Average from Average at Caris & Co. as the firm believes the shares will rise on the potential NDA filing of AIR-CF2 in Q2 and its potential approval in early 2008.
Honeywell (NYSE: HON) was upgraded to to Buy from Above Average at Caris & Co. on expected top-line growth driven by global macro trends.
MOST NOTEWORTHY: Swift Transportation (SWFT), JetBlue (JBLU) and Southwest (LUV) top today's list of upgrades.
Following Director Moyer's offer to buy Swift Transportation, Inc. (NASDAQ:SWFT) for $29 a share, the company was upgraded to Market Perform from Underperform at Wachovia, to Peer Perform from Underperform at Bear Stearns and to Neutral from Sell at Bank of America.
JetBlue Airways Corp. (NASDAQ:JBLU) was upgraded by Raymond James to Outperform from Market Perform following the October traffic report.
Southwest Airlines Co. (NYSE:LUV) was upgraded to Outperform from Underperform at Credit Suisse based on valuation.
OTHER UPGRADES:
Medimmune, Inc. (NASDAQ:MEDI) was upgraded to Outperform from Market Perform at Friedman, Billings Ramsey, citing Numax data and increased sales expectations for the drug.
Finally, H&R Block, Inc. (NYSE:HRB) was upgraded to Buy from Sell at Soleil. The firm believes H&R Block's decision to explore strategic alternatives could lead to a possible sale of the whole company or certain parts of the company.
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