|Widows and Orphans||+0.22%|
|Climbers and Dogs||+0.10%|
|Pretty Girls and Railroads||-0.37%|
|Symbol||Company Name||Price||Price Chg.||Price % Chg.||Volume (000)||Volume % Chg.|
|LAD||Lithia Motors Inc Cl A||$63.45||1.87||3%||264||47%|
|ULTA||Ulta Salon Cosm & Frag||$100.23||1.34||1%||147||-73%|
|TEF||Telefonica S A Adr||$14.04||0.12||1%||725||-7%|
|PM||Philip Morris Intl Inc||$89.08||0.41||0%||1,300||-58%|
|KRFT||Kraft Foods Group Inc||$56.75||0.26||0%||886||-50%|
|PCL||Plum Creek Timber Co Inc||$48.82||0.13||0%||316||-42%|
|ELN||Elan Plc Adr||$15.50||0.04||0%||27,874||228%|
|UNP||Union Pacific Corp||$157.61||0.39||0%||843||-14%|
|ALSK||Alaska Comm Systems Grp||$2.52||0.01||0%||266||-37%|
|DUK||Duke Energy Corp||$71.35||0.13||0%||870||-50%|
|HON||Honeywell Intl Inc||$82.77||0.01||0%||1,350||-25%|
|JNJ||Johnson & Johnson||$93.03||-0.18||0%||4,157||-29%|
|AB||Alliancebernstein Hld Lp||$22.10||-0.05||0%||55||-79%|
|PRTA||Prothena Corp plc||$16.95||-0.04||0%||09||-85%|
|CNI||Canadian Natl Ry Co||$100.59||-0.29||0%||376||10%|
|PTR||Petrochina Co Ltd Adr||$116.80||-0.42||0%||84||-16%|
|IAU||Ishares Gold Trust||$12.87||-0.05||0%||1,582||-55%|
|COG||Cabot Oil & Gas Corp||$75.99||-0.55||-1%||734||-34%|
|SAN||Banco Santander Sa Adr||$7.25||-0.06||-1%||3,249||-27%|
|KMI||Kinder Morgan Inc||$37.88||-0.32||-1%||1,950||-11%|
|HRZN||Horizon Tech Finance||$14.15||-0.13||-1%||57||58%|
|BGS||B & G Foods Inc||$34.58||-0.32||-1%||108||-43%|
|STO||Statoil Asa Adr||$21.46||-0.21||-1%||682||-35%|
|DEO||Diageo Plc Ads||$121.53||-1.17||-1%||247||-23%|
|NSC||Norfolk Southern Corp||$73.13||-0.73||-1%||630||-50%|
|GWR||Genesee & Wyoming Inc||$88.99||-0.93||-1%||242||-19%|
|MDLZ||Mondelez Intl Inc Cl A||$31.20||-0.41||-1%||5,228||-14%|
|PTNR||Partner Communicatns Ads||$7.37||-0.10||-1%||34||-41%|
|BPT||B P Prudhoe Bay Rylty Tr||$89.35||-1.42||-2%||44||-44%|
|CP||Canadian Pacific Railway||$124.60||-2.17||-2%||523||6%|
|FRO||Frontline Ltd Adr||$2.58||-0.08||-3%||372||-49%|
|CEL||Cellcom Israel Ltd||$10.74||-0.61||-5%||120||83%|
1:42 PMPerrigo gets sell-side love after Elan deal
- The sell-side likes Perrigo’s (PRGO +0.5%) acquisition of Elan.
- Deutsche upgrades the shares to Buy from Hold (PT to $150 from $120), saying the deal “makes sense for a number of reasons,” and noting that $125 “looks like an attractive entry point.”
- Goldman ups the stock to Neutral from Sell (PT to $132 from $122) as Jami Rubin says the acquisition “provides PRGO a more flexible financial structure … to drive enhanced ROIC from future deal activity.”
- Stifel raises its price target to $145 from $125 and BofA upgrades the shares to Neutral (PT to $133 from $116) citing “significant tax (and operational) synergies.”
1:27 PMRubicon jumps on Peregrine Semi numbers, Apple speculation
- Rubicon (RBCN +8.9%) sapphire wafer customer Peregrine Semi (PSMI +13.5%) posted a strong Q2 beat yesterday afternoon on the back of growing RF switch sales to smartphone OEMs.
- Sapphire manufacturing equipment vendor GT Advanced (GTAT +6.3%) is also rallying.
- Peregrine’s Q3 guidance is only in-line (revenue of $58M-$62M vs. $60.6M consensus), but expectations have been low.
- Peregrine mentioned on its Q2 CC ramping 4G smartphone sales are growing its addressable market, and asserted the increasing RF complexity of 4G phones (thanks to the need to support numerous bands and carrier aggregation) works in its favor.
- Sterne Agee is upbeat about the implications of Peregrine’s numbers for Rubicon, and also provides fresh speculation about Apple’s potential use of sapphire cover glass.
- Rubicon and GT Advanced’s gains come in spite of an underwhelming Q2 update from Veeco.
1:24 PMRockwell Automation’s profit jumps, shares rise
- Shares of Rockwell Automation (ROK +5.2%) are higher on the session after the company’s FQ3 profit rises 12% Y/Y, beating estimates.
- Operating margin increases 90 bps for the period on “volume leverage.”
- CEO Keith Nosbusch is “very pleased” with organic sales growth of 4% and says “market conditions [should] remain stable through Q4.”
- FY13 outlook: Adjusted EPS of $5.50-5.70 on revenue of $6.3B. Consensus is $5.48/ share on $6.4B in sales. (PR)
1:24 PMIndia sinks on hawkish RBI comments
- The Sensex declined 1.25% overnight after the Reserve Bank of India kept its benchmark rate steady at 7.25% but said it would “forfeit some monetary policy discretion to address external sector concerns.” Translation: Slowing inflation and growth might normally lead to easier policy, but the bank is instead focused on supporting the rupee.
- Marketfields’ Michael Shaoul notes an Indian small cap index off 27% YTD to a 4-year low is a pretty good gauge of the stress in the domestic economy. An Indian small cap ETF: SCIF -5.3% today.
- Individual stocks: ICICI Bank (IBN -3.3%), Tat Motors (TTM -4.7%), Dr. Reddy’s Labs (RDY -4.4%).
- Not bullish on Indian consumer names, Credit Suisse does take a liking to one with U.S. exposure: Wipro (WIT +1.1%).
- Other ETFs of note: EPI -3.9%, INDY -3.2%, PIN, INP, INDA, INXX, SCIN, INDL.
1:18 PMGenerac gains on a solid Q2 earnings beat; raises guidance for a second time
- Generac Holdings (GNRC +4.5%) moves up after easily beating Q2 estimates this morning.
- Revenues were up 45% from the same quarter last year.
- The company raises guidance for a second time, now expecting FY13 revenues to increase in the low 20% range, up from the previous growth guidance of low-to-mid teens rate.
- For H2, net sales are now projected to increase in the mid-single digit range as compared to the prior-year second-half.
- Despite the upbeat forecast, the company cautions that its facing a big hurdle from last years “very strong” H212 comps.
1:08 PMNYSE sale to ICE on track to close in Q3
- NYSE Euronext (NYX +0.8%) CEO Duncan Niederauer says the company’s sale to IntercontinentalExchange (ICE +1%) is on track to close this fall after securing a number of key approvals, including one last month from the EU.
- The companies await a ruling from the SEC due by August 15.
- Analysts expect today’s earnings release will be NYSE’s last as a standalone company, and NYSE management didn’t take questions on the earnings call – deferring those until ICE’s August 6 call.
1:07 PMSoda ban struck down again in New York City
- An appellate judge in New York upheld a ruling striking down a large-sized soda ban in New York City, setting the stage for the case to move on up to the New York Court of Appeals.
- The issue has come up in the NYC Mayoral race with leading candidate Christine Quinn and disgraced contender Anthony Weiner both in support of soda sizes without limits.
- Execs with Coca-Cola (KO +0.2%), PepsiCo (PEP +0.2%), and Dr. Pepper Snapple (DPS -0.4%) have been quietly confident that events in the Big Apple would go their way, but still face a larger issue of sluggish soda drink sales in the U.S. due in part to health concerns.
1:00 PMOn the hour
- Dow +0.14%.
- 10-yr -1.43%.
- Euro 0.% vs. dollar.
- Crude -0.45% to $1323.65.
- Gold +0.12% to $15540.5.
12:56 PMDid one phone call help Chrysler save over $100M?
- Chrysler’s (FIATY.PK) refusal to comply with a NHTSA recall drew a lot of notice when it ended a long era of automakers backing away from a direct confrontation with regulators in public.
- According to reports, a phone call in June between CEO Sergio Marchionne and NHTSA officials helped convince the agency to reduce the number of recalled vehicles from 2.7M Jeep SUVs to 1.56M.
- Pro-rating what Chrysler reported today to be its recall cost by the reduced number of vehicles indicates the negotiating tactic might have saved the automaker $109M.
12:52 PMGoldman’s SanDisk downgrade: firm sees supply growing, margins peaking
- Goldman’s James Schneider, who has cut shares to Neutral, thinks NAND flash supply could grow faster in the next few quarters than previously expected, and that margins “are likely to peak in 2H13″ thanks to price pressure and slowing cost reductions.
- SanDisk (SNDK -2.3%) shares nearly doubled from last summer’s lows thanks in large part to healthy pricing, rising margins, and expectations NAND supply growth will remain limited. These factors have also given a big lift to Micron (MU +0.6%) shares.
- Yesterday, Morgan Stanley asserted there is “no more upside” in the memory chip space, while predicting DRAM growth/ASPs/margins will peak in Q3.
- MS observes Samsung (SSNLF.PK), Hynix, SanDisk partner Toshiba (TOSBF.PK), and Micron’s Elpida and Inotera units are all set to expand capacity in response to strong smartphone, tablet, and SSD-related orders.
- MS: “Most investors we met are convinced that this time it is different … However, industries do not stay in a vacuum or steady state when faced with huge excess returns building and significant shortage heading into 2H13.”
12:49 PMEastman powers higher, Deutsche Bank raises target price to $100
- Eastman Chemical (EMN +8%) powers higher after Q2 results beat on earnings and revenue, and raising its FY 2013 EPS above consensus.
- Deutsche Bank raises its target price to $100 from $85 after finding EMN’s Q2 particularly encouraging given the challenging macro backdrop and mixed results from chemical peers. DB believes EMN should trade at a premium to its differentiated chemical peers vs. its current 10% discount.
12:40 PMLCA-Vision Q2 EPS swings to a profit despite a decline in LasikPlus procedures
- LCA-Vision (LCAV +13.4%) trades up today after swinging to a Q2 profit of $0.02 a share, reversing a $0.17 per-share net loss in the year-ago period and beating Street expectations for a $0.11 loss.
- However, revenue was down slightly from the same period last year, falling slightly short of consensus forecasts, as LasikPlus procedures declined 9.9% due to new lower limits to tax-saving flexible spending accounts, which caused some patients to put off elective surgery.
- 12,994 procedures were performed during Q2, down from 14,415 procedures the year before and below the 16,272 procedures performed during Q1.
12:36 PMTime to buy munis?
- The municipal market is about to enter an extended period of recovery, says the team at BMO Capital, noting the recent weeks have been the 3rd significant period of stress over the past 5 years – the first being post-Lehman and the other being the post-Whitney default warning.
- This time it’s the big jump in Treasury yields amplified by the Detroit bankruptcy which pushed muni spreads to Treasurys to their highest in a year – unusual action as higher rates bringing on tighter spreads is typically the norm.
- Municipals often have their best performance after such periods.
- ETFs of note: MUB, SUB, MUNI, PVI, PZA, SHM, TFI, VRD, HYD, ITM, MLN, PRB, SMB, GMMB, SMMU, RVNU.
12:31 PMThe squeeze is on at Pitney Bowes after earnings and divestiture
- Pitney Bowes (PBI +11.5%) soars a day after it showed more profit than anticipated in Q2.
- The decision to sell its management services business to Apollo Global Management for $400M is expected to help the company operate more leanly.
- Short interest is very high on PBI which could be affecting trading.
12:28 PMComstock’s Q2 loss narrows but results miss estimates
- Comstock Resources (CRK -5.6%) sinks after Q2 results came in well below expectations; net income surged amid income from discontinued operations, but revenue fell 2.5% Y/Y.
- Q2 production was 551K barrels of oil and 14.2B cu. ft. of natural gas, or 17.5B cfe vs. 24.5B cfe in the year-ago quarter; oil production rose 20% Y/Y to 6,048 bbl/day, but gas production dropped 35% Y/Y due to the lack of drilling activity in CRK’s Haynesville shale properties.
12:26 PMFacebook officially launches mobile game publishing effort
- Facebook’s (FB +5.5%) initiative, which has been in trial mode, gives mobile game developers free ads and other promotional support in exchange for a revenue cut.
- Facebook exec Dan Morris: “The idea is not to show one game to all users but to … match users with the games they like.”
- Facebook has already been successful at promoting games and other mobile apps via its app install ads.
- The service, which could give smaller developers more promotional reach, is arguably a negative for Zynga (ZNGA -1.2%), which depends a lot on its ability to cross-promote games to users playing other Zynga titles.
- Zynga has been gradually ramping its own publishing efforts. Activision (ATVI – previous) and Glu Mobile (GLUU – previous) also have mobile publishing ambitions.
- Previous: Facebook closing in on IPO price.
12:18 PMBP-led consortium takes control of Trans Adriatic Pipeline
- The Shah Deniz consortium developing the Trans Adriatic Pipeline, slated to ship natural gas from the Caspian region to Italy, says a group of gas producers including BP has effectively taken control of the project.
- BP and Azerbaijan’s state-owned Socar each acquired 20% stakes in TAP, while France’s Total (TOT) bought a 10% share; holdings of previously existing TAP shareholders including Statoil (STO) are reduced.
- Initially 10B cubic meters each year will be exported through TAP; the pipeline is expandable to ~20B cm/year.
12:15 PMChart Industries trades solidly higher on a Q2 earnings beat and new contract awards
- Chart Industries (GTLS +14.7%) pops today after a solid Q2 earnings beat, setting a new 52-week high of $115.67 before settling back.
- Total revenue rose 24% Y/Y, driven by record D&S order intake led by LNG demand.
- Order backlog also hit a record of $664M.
- The company raises the bottom end of its FY13 EPS guidance by $0.10 per share to a new range of $3.10 to $3.40, straddling the consensus of $3.17 per share.
- FY13 revenues are anticipated to be $1.2B to $1.3B, also in line with the Street view of $1.22B.
- Announces a $50M contract award to provide LNG equipment to PetroChina.
- Subsidiary Chart E&C receives a LNG liquefaction plant order from Noble Energy to provide a processing facility to produce approximately 100K gallons of liquefied natural gas per day.
12:10 PMSell side comments on American Capital Agency
- About the best thing to be said of American Capital Agency’s (AGNC +6%) Q is “better than feared,” says KBW (which has the stock a Buy with $27 PT). An 11.8% decline in book value beat market expectations, but was worse than KBW’s models predicted. While still positive on the stock, the team sees the valuation being stuck at less than 90% of book until rate volatility subsides and the dividend outlook clears.
- Sterne Agree retains its Hold and $22 PT, also saying book value missed what its model suggested. “With the shares at about 86% of book value, we suspect most of this is already discounted.”
- Fellow mortgage REIT giant Annaly (NLY) is set to report on Thursday.
12:09 PMNext-gen Kindle Fire specs leaked, Qualcomm a winner
- BGR follows up on its July 9 scoop about new Kindle Fire (AMZN -0.1%) models sporting higher-resolution displays by reporting next-gen 7″ and 8.9″ Fire HD models will use Qualcomm’s (QCOM +1%) top-of-the-line Snapdragon 800 CPU (quad-core, reportedly clocked at 2GHz.).
- Texas Instruments, which has thus far been Amazon’s app processor supplier, announced last fall it’s exiting the mobile app processor market.
- The 8.9″ Fire HD will reportedly have an 8MP rear camera; the 7″ model will be camera-free.
- The entry-level Kindle Fire will ship with 8GB-32GB of storage; the HD models will have 16GB-64GB.
- Amazon is reportedly aiming for a fall launch.
- The updated Fires will arrive with Barnes & Noble gradually exiting the tablet market, and reports indicating a retina iPad Mini won’t launch until 2014. However, Amazon will have to compete with a new Nexus 7 (receiving good reviews) and Samsung’s refreshed Galaxy Tab/Note lineup.
12:00 PMOn the hour
- Dow +0.07%.
- 10-yr -1.36%.
- Euro 0.% vs. dollar.
- Crude -0.37% to $1324.65.
- Gold +0.19% to $15551.5.
12:00 PMHerbalife hints at more buybacks, shares rise
- Herbalife (HLF +6.3%) shares are moving back towards their highs of the day as management says the company is “underlevered” on the call.
- Although buybacks are factored into guidance, HLF suggests it could repurchase more shares without tapping the debt market.
11:58 AMAnadarko viewed as core holding by Deutsche Bank
- Anadarko Petroleum (APC -1%) is reiterated with a Buy rating at Deutsche Bank following mixed Q2 results, as the firm continues to think uncertainty stemming from potential Tronox (TROX) liabilities creates opportunity.
- The firm thinks a post-Tronox outlook should see APC narrow the discount to NAV via aggressive asset sales and monetizations.
- “APC arguably enjoys the best multi-year set up in the global upstream,” DB says, continuing to view the stock as a core holding.
11:57 AMBarclays rights offering larger than expected
- Barclays (BCS -6.8%) is reiterated a Sell by Nomura’s Chintan Joshi who says the £5.8B rights offering is larger than the market expected
- Long-term the move is a positive, says Joshi, who is more concerned with the target of ROE being above cost of capital being pushed back to 2016 (earnings earlier)
- The stock should remain under pressure in the near-term, but begin to shrug that off as the rights issue moves into the rear-view mirror
11:55 AMStereotaxis soars after getting FDA 510k clearance for its Vdrive Robic Navigation System
- Stereotaxis (STXS +229%) rockets higher today after announcing late yesterday that it’s been granted 510(k) clearance by the FDA to market its Vdrive Robotic Navigation System with V-Sono Intracardiac Echocardiography catheter manipulator in the U.S.
- This is the first clearance by the agency for the device maker’s Vdrive family of products, which have been used in Europe since 2011.
11:39 AMApple roundup: home button fingerprint sensor, Cook in China again?
- Developer Hamza Sood has uncovered code that appears to confirm rumors the iPhone 5S’ (AAPL +1.8%) home button will have a built-in fingerprint sensor.
- Tim Cook reportedly traveled to China this week to meet with China Telecom’s (CHA +0.3%) leadership. No details on what was discussed; chances are CHA will be a major buyer of the low-cost iPhone.
- In a “final office action,” the USPTO has rejected 21 claims within Apple’s pinch-to-zoom patent. Look for Apple to appeal the ruling. In June, the USPTO reaffirmed the validity of a claim in Apple’s “rubber-banding” patent after previously invalidating it.
- Leaked photo cases and a BI source indicate the low-cost iPhone will be called the iPhone 5C. “C” is meant to stand for “color,” though as BI notes, critics could refer to it as standing for “cheap.”
- Sprint sold 1.4M iPhones in Q2, down from 1.5M in Q1 and a year ago. For reference, Verizon sold 3.9M iPhones in Q2, and AT&T at least 3.7M.
- The iPhone’s U.S. customer loyalty remains strong. A CIRP survey found 78% of U.S. iPhone owners upgrading to a new iPhone vs. 67% of Android owners buying a new Android phone.
11:34 AMHerbalife renames personal users, comments on audits
- On its conference call, Herbalife (HLF +5.6%) says it will begin referring to personal users as “members” rather than “distributors” in order to help those who have been “badly deceived about the way [the] business works” better understand the model.
- Management says Pricewaterhouse will complete its re-audits (which include audits of Q1 and Q2 2013 results) “no later than the end of the year.” (previous)
11:33 AMTeck Resources reportedly bidding for Rio’s Iron Ore of Canada stake
- Teck Resources (TCK -1.4%) is among the remaining bidders for Rio Tinto’s (RIO -0.2%) 59% stake in Iron Ore Co. of Canada, Bloomberg reports.
- Rio’s stake could fetch as much as $3.5B, analysts say, but Rio is said to be disappointed with the bids received so far.
- Buying Canada’s largest iron ore producer would help TCK diversify its production, but TCK has said it would look at a deal only if it could retain its investment grade credit rating.
11:32 AMPeugeot gets a lifeline
- Peugeot (PEUGF.PK) wins approval from the European Union for a $7B euro state guarantee.
- The action follows more noise from the French government that the automaker is “too French to fail.”
- The news is relevant to General Motors (GM +0.5%) with the company holding on to a 7% stake.
11:31 AMBanks sued again over CDS monopoly
- An affiliate of MF Global sues, alleging 11 banks engaged in anticompetitive practices to keep the company out of the lucrative clearing business for swaps
- It’s the third U.S.lawsuit making such claims (previous), and the EU has also filed suit
- Those charged: BAC, BCS, C, CS, DB, GS, MS, RBS, UBS
- JPMorgan (JPM) is named as a co-conspirator, while the ISDA and Markit are named separately as defendants
- One source suggests the 3 U.S. claims could be consolidated into one case
11:28 AMMDC Holdings trades sideways following its earlier Q2 report
- MDC Holdings (MDC +0.2%) gets a lackluster response from the market today, despite reporting solidly better-than-expected Q2 results.
- Like other builders, the company saw an order slowdown in the spring amid the jump in mortgage rates and prices.
- Orders on a unit basis -4% Y/Y – however, on a dollar basis they increased by 12%. Home sale revenues +56% Y/Y, homes delivered: 1,183, +37%, average selling price: $338,400, +14%.
- Gross margin from home sales: 18.1% versus 14.2% in the prior year period.
11:26 AMNissan recalls 13k subcompact vehicles
- Nissan (NSANY.OB) recalls 13K Versa Note subcompact hatchbacks to address an issues with bolts in the back of the vehicle.
- The affected vehicles are from this year’s model year.
- The company in the past has made great efforts to show that its cars built in Mexico are equal in quality to those manufactured in Japan.
11:17 AMTrinity Biotech revenue comes in light
- Trinity Biotech (TRIB -3.1%) Q2: Diluted EPS (ex-Medical Devise Excise Tax) of $0.176.
- Revenue of $21.3M (+2.4% Y/Y) misses by $0.7M.
- The company also says it is acquiring Immco Diagnostics for $32.75M, a deal TRIB says will be “immediately earnings accretive.” (PR)
11:15 AMBP not expecting spill settlement, bracing for long legal haul
- CEO Bob Dudley says BP (BP -3.9%) is digging in for a long battle over Gulf of Mexico compensation costs, with a settlement with the U.S. now seen as “highly unlikely.”
- Cumulative charges to be paid reached $19.7B at the end of Q2; the $20B fund is almost tapped out, so BP would then need to make more charges to its income statement after already taking $42.4B in spill-related charges.
- The spill isn’t BP’s only problem: U.S. liquids production of 335K bbl/day was its lowest in 15 years, an RBC analyst says. (Q2 results)
11:11 AMHigh-end cars susceptible to hacking
- Volkswagen (VLKAY.PK) takes to legal action in an effort to stop academics at the University of Birmingham from publishing a paper on how they were able to hack anti-theft systems used in Audi models.
- The clever bunch were also able to work their way into Porsches, Bentleys, and Lamborghinis by cracking an algorithm.
11:02 AMFacebook continues rallying, IPO price in striking distance
- Facebook (FB +3%) is now up 38% since delivering its blowout Q2 report (I, II), and is closing in on its IPO price of $38.
- EPS estimates have soared since the report, as analysts strike a more bullish tone. The 2013 consensus has risen to $0.71 from $0.57, and the 2014 consensus to $0.94 from $0.78.
- That still leaves the company trading at 34x 2014E EPS after backing out $10.3B in cash/investments. Facebook’s huge sales, R&D, and capex investments have much to do with its multiples.
11:00 AMOn the hour:
- Dow +0.1%.
- 10-yr -1.29%.
- Euro 0.% vs. dollar.
- Crude -0.36% to $1324.85.
- Gold +0.06% to $15531.5.
10:57 AMBrazil antitrust agency to decide if Petrobras violated law
- Brazil’s antitrust agency says it will decide in 30 days if Petrobras (PBR -2.3%) and OGX (OGXPY.PK) violated antitrust laws in a deal announced in November; at the time, PBR agreed to sell its 40% stake in the offshore BS-4 oil block to OGX for $270M.
- If the agency decides the deal without approval, the companies may be subject to fines of up to 60M reais ($27M).
10:51 AMSenior Housing Properties earnings
- Senior Housing Properties (SNH -1.6%) normalized FFO of $0.42 per share is off from $0.45 a year ago (share count rose to 188.1M from 162.7M)
- Terminated agreement to buy a MOB in Cherry Hill, NJ for $21.5M after due diligence
- 5 other properties with combined purchase price of $100.6M are under contract
- 11 properties with 856 living units are up for sale
- Previous: Earnings report
- Details: Earnings press release
10:51 AM$16 as good as it gets for Saks, says Citigroup
- Citigroup doesn’t think another buyer will emerge to top the offer from Hudson’s Bay to buy Saks (SKS +0.3%).
- The deal allows for a 40-day “go-shopping” period.
- Trading at $15.98, shares of Saks are only two cents from the Hudson’s Bay takeout price.
10:45 AMWestern Union rides earnings beat to greater heights
- Western Union (WU +6.6%) gets a neat little bounce after the company’s Q2 report didn’t come in as weak as expected.
- On a year-over-year comparison, revenue dropped 3% and profit fell 27% with the company forced to lower prices to compete.
- Improving sales for Western Union’s business solutions and new developments with mobile and web initiatives appear to be helping to buoy sentiment.
10:43 AMPotash turmoil ‘a complete game changer’
- Credit Suisse calls the dismantling of one of the world’s largest potash partnerships “a complete game changer,” with share prices in the sector possibly cut in half. “Our guys are saying don’t go anywhere near” the big fertilizer names; “we would not be bottom fishers here.”
- JPMorgan is out defending the group, thinking Mosaic (MOS -21.4%) should be down $8 and Potash (POT -20.9%) down $5. A $50/ton drop in pricing would knock EPS by $0.75 for MOS and $0.40 for POT, far better than peers.
- IPI -29.5%, CMP -26.8%, AGU -3.8%, UAN -2.5%, CF -0.2%.
10:43 AMSome notes from the Merck earnings call earlier
- Merck (MRK -0.2%) CEO Ken Frazier says it plans to “aggressively manage” costs, while supporting key brands and drug research projects.
- The company doesn’t rule out shedding its animal-health and consumer-care businesses, with Frazier saying that if the asset proves to be more productive outside the company, it would consider the alternatives.
- New research chief Roger Perlmutter says the company’s going to be applying more stringent controls over the direction its R&D takes, stressing the move is necessary to strengthen investment returns.
- Perlmutter also says he will “fully participate” in drug-licensing activity.
- Listen to the Webcast here: Merck Earnings Call
10:40 AMStemline soars on coverage initiations
- Stemline Therapeutics (STML +13.2%) posts double-digit gains in morning trading.
- Roth Capital starts the shares at Buy with a $50 price target, representing a 110% upside from Monday’s close.
- LifeScience Advisors initiates coverage as well.
10:39 AM3D Systems tanks following Q2 report, peers also down
- With 3D’s (DDD -6.8%) shares up 5x from the start of 2012 going into the report, there wasn’t much margin for error.
- Stratasys (SSYS -3.2%) and ExOne (XONE -5.1%) are lower in sympathy.
- 3D’s big Q2 R&D spending ramp follows complaints the company and other 3D printer makers haven’t been spending enough on R&D to drive broader 3D printing adoption.
- R&D still only totaled 7.9% of revenue in Q2, well below the percentages spent by many tech companies.
- SG&A spend rose 23% Q/Q and 50% Y/Y to $36.2M. It remains nearly 4x greater than R&D spend ($9.6M).
- Q2 results, PR
10:36 AMSeeking Alpha moves stocks
- Idenix Pharmaceuticals (IDIX +7.4%) and Oxford Resource Partners (OXF +15.6%) are sharply higher in early trade after bullish SA Pro articles (embargoed until tomorrow morning)
- McDuck capital calls Idenix a potential multi-bagger recently made cheap by the market’s falling out of love with Hepatitis C’s most promising treatment
- Oxford Resources – virtually unknown and operating in the heavily out-of-favor coal industry – is a turnaround play also with multi-bagger potential, says GuruFundPicks
10:28 AMSirius XM Radio lands terrestial radio legend
- Sirius XM Radio (SIRI +0.1%) announces it landed an exclusive contract with Art Bell for a new late-night show.
- The National Radio Hall of Fame member is believed to still have a significant following despite being largely absent from the airwaves over the last few years.
10:25 AMHCP earnings
- HCP (HCP +0.2%) FFO per share of $0.72 up 4% Y/Y, funds available for distribution of $0.62 up 11%
- FY13 FFO guidance increased to $2.96-$3.02 per share, representing an 8% Y/Y growth rate at the mid-point; FAD guidance upped to $2.46-$2.52 per share, a 12% growth rate
- Investments of $367M made in Q2
- Earnings call at 12 ET
- Previous: Earnings report
10:20 AMTata Motors trades lower
- Shares of Tata Motors (TTM -5.6%) fall after a tough market day in India takes its toll.
- Some traders think the dip is a buying opportunity with Goldman Sachs backing the automaker strongly yesterday and some positive signs from Europe and China on demand for Jaguar Land Rover vehicles.
10:18 AMNational Oilwell Varco opens lower as earnings slide
- National Oilwell Varco (NOV -2.7%) opens lower after posting a 12% Y/Y decline in Q2 earnings on higher costs.
- Rig technology revenue 18% to $2.83B, petroleum service and supplies revenue fell 2% to $1.75Bm distribution and transmission revenue grew 66% to $1.3B on acquisitions made last year.
- Landed $3.15B in rig technology orders during Q2, raising its backlog to a record $13.95B.
10:13 AMCellcom says it’s not for sale, preliminary Q2 results released
- The carrier says its controlling shareholder (IDB Holding) has made it known Cellcom isn’t for sale. Globes reported yesterday Golan Telecom is “seriously considering” a bid.
- Cellcom’s (CEL -3.4%) Q2 revenue fell to NIS1.22B-1.24B ($342M-$347M) from 1.498B. Service revenue fell to 990M-1.01B from 1.182B.
- In spite of the revenue drops, free cash flow rose to NIS340M-345M from 284M.
- ARPU rose slightly Q/Q to NIS77.5-79.5 from 75.9, but was still down sharply from last year’s 90.3, as intense price competition continues taking a toll.
10:07 AMMCG Capital earnings
- MCG Capital (MCGC +2.1%) net operating income (before investment gains/losses) of $7.6M up 35% Y/Y, helped by $2.1M decline in G&A expense thanks to $1.8M in severance costs a year ago
- Spread to Libor on loan portfolio of 12.1% vs. 10.7% a year ago
- $70.9M in fundings vs. $15.9M in Q1
- Monetized $19.8M in debt portfolio
- $96.6M in cash on hand for new investments
- Outlook: Monetizations of $30M-$50M for rest of 2013, with $20M-$30M expected to reduce borrowings; new originations expected at $500M-$530M
- Previous: Earnings, $0.125/share distribution declared
10:04 AMDana Holding to repurchase preferred shares
- Dana Holding (DAN +2.1%) announces it worked out an agreement with Centerbridge Capital Partners to repurchase 2.5M shares of a preferred series of stock held by the firm. The deal price will be $22.50 per underlying common share.
- The company says the arrangement will reduce the number of fully diluted shares by 10%.
- In order to finance the undertaking, Dana Holding will launch a $600M senior note offering.
10:02 AMHMA warns on profit; receives further subpoenas; shares sink
- Health Management Associates (HMA -10.4%) expects Q2 adjusted EPS $0.10-0.11 vs forecasts of $0.21.
- Predicts net revenue of $1.46B vs $1.69B a year ago and consensus of $1.73B, hurt by weak admissions.
- Adjusted EBITDA seen at $190-195M.
- Same hospital net revenue is expected to fall by $74M, due to lower revenue per adjusted admission.
- Receives additional subpoenas from the U.S. Department of Health & Human Services regarding certain emergency room operations and physician relationships. (PR)
- Names John Starcher as interim President and CEO, effective from Thursday, to replace the retiring Gary Newsome. Starcher is HMA’s Eastern Group President.
- Earlier, HMA announced that it’s being bought by Community Health Systems (CYH -1%) for $3.9B.
10:01 AMIPG Photonics +3.6% following Q2 beat, in-line Q3 guidance
- Q3 guidance is for revenue of $165M-$175M and EPS of $0.77-$0.87 vs. a consensus of $172.6M and $0.86. Q2 book-to-bill “substantially exceeded 1.”
- Materials processing laser sales (94% of revenue) continue to be healthy as IPG’s (IPGP) fiber lasers take more share from traditional industrial lasers; sales +26% Y/Y in Q2 vs. +29% in Q1.
- Unit sales of IPG’s QCW lasers more than doubled Y/Y.
- China and the U.S. saw strong demand in Q2. German automotive sales were weak, but European demand was “otherwise solid.”
- Gross margin was 53.5%, +20 bps Q/Q and -80 bps Y/Y.
- Exc. forex losses, opex +43% Y/Y (above rev. growth) thanks to big increases in G&A and R&D spend.
- CC getting underway (webcast).
- Q2 results, PR
10:00 AMOn the hour
- Dow +0.15%.
- 10-yr -1.02%.
- Euro 0.% vs. dollar.
- Crude -0.46% to $1323.55.
- Gold +0.33% to $15572.5.
9:57 AMAckman has new questions for Herbalife
- Bill Ackman is out with a press release ahead of Herbalife’s (HLF +7.7%) conference call.
- According to CNBC’s Scott Wapner, Ackman claims the company’s headline numbers obscure relatively lackluster operating income growth of 3% (see page 5 of the 10Q).
- Ackman is also questioning why Pricewaterhouse did not review the quarterly filing (NT-10Q).
9:53 AMRisk-weighted ETF launches from VelocityShares
- VelocityShares launches the Equal Risk Weighted Large Cap Fund (ERW) with annual expense ratio of 0.65%
- This particular method weights each stock held using historic price movements and implied volatility in order that all contribute the same level of risk to the portfolio
9:52 AMHolly Energy Partners declares quarterly distribution of $0.4850/share
- Holly Energy Partners (HEP) declares quarterly distribution of $0.4850/share, 1.6% increase from prior dividend of $0.4775. Forward yield 4.97% For shareholders of record Aug. 05. Payable Aug. 14. Ex-div date Aug. 01. (PR)
9:51 AMAfrican Barrick faces suit over Tanzania deaths
- Barrick Gold’s (ABX -1.8%) African Barrick subsidiary is sued in a U.K. court by a group of Tanzanian villagers who allege the miner was complicit in the killing of six locals by police over the last three years as they looked for gold at or around the North Mara mine.
- The news comes as ABX looks to sell its controlling 74% stake in African Barrick amid a declining gold price and high debt burden.
9:46 AMAgribusiness ETFs hammered by potash bombshell
- The Market Vectors Agribusiness ETF (MOO -4.7%) and the PowerShares Global Agriculture ETF (PAGG -5.5%) after Russian potash producer Uralkali says it’s going to make it up on volume
- Potash, Agrium, and Mosaic make up about 16% of MOO holdings, nearly 20% of PAGG
- Others: The Global X Fertilizer/Potash ETF (SOIL -8.9%)
9:43 AMA roundup of tech analyst ratings changes
- Bankrate (RATE +13.6%) has been upgraded to Buy by BofA in response to its Q2 report.
- SanDisk (SNDK -2.5%) has been cut to Neutral by Goldman.
- OpenTable (OPEN -1.3%) has been cut to Neutral by Macquarie.
- Sohu (SOHU -0.7%) has been cut to Equal Weight by Morgan Stanley following yesterday’s Q2 report (I, II).
- EDA software firms Mentor Graphics (MENT -0.1%) and Synopsys (SNPS +0.8%) have been started at Outperform by Pac Crest. Rival Cadence (CDNS -0.2%) has been started at Sector Perform.
9:38 AMTeva falls on Goldman downgrade
- Goldman downgrades Teva Pharmaceutical (TEVA -1.8%) to Sell, price target is $40.
- The company’s focus on pipeline rebuilding has left it “relatively quiet” in an environment “awash with accretive deal activity,” analyst Jami Rubin notes.
- Of course there’s also the whole generic Copaxone problem which Rubin says will leave the company “facing fewer options with respect to capital allocation.”
- Previously: Patent invalidation dents TEVA’s plan to transition Copaxone patients to longer-acting formulation.
9:35 AMBoeing gets ANA order worth $1.13B at list prices
- Boeing (BA) receives an order from All Nippon Airways for three 777-300ER jets and one 767 cargo aircraft, with the booking worth $1.13B at list prices.
- The fire on the Ethiopian Airlines 787 at London’s Heathrow Airport earlier this month will provide the first test of how easy – or difficult and expensive – it will be to repair the carbon-composite plane
- Boeing has yet to put a price tag on a new version of the 777, which will use 20% less fuel per seat. One problem is that it’s exceptionally difficult trying to forecast what oil prices will do and how big a saving airlines will be able to make, especially as the 777X won’t be delivered until 2020.
9:33 AMCorning Q2 glass sales solid, Q3 price declines steady
- Corning’s (GLW -1%) Q3 LCD glass volumes are expected to be up slightly Q/Q, and price declines steady with Q2.
- Specialty Materials (inc. Gorilla Glass) sales are expected to grow 10% Q/Q.
- Telecom sales seen growing 20% Y/Y, environmental technologies “up slightly,” Life Sciences (boosted by acquisition) +40%-45%
- Q2 Display Technologies sales (inc. LCD TV glass) +21% Y/Y, up from +7% in Q1. LCD glass price declines smaller than Q4′s, as expected. Segment earnings +11%.
- Telecom sales +8% (-7% in Q1), Earnings +62% (aided by cost reductions).
- Specialty Materials (inc. Gorilla Glass) +2% Y/Y (-10% in Q1). Earnings +33%.
- Environmental Technologies -8% Y/Y (-13% in Q1), Life Sciences +35%.
- Dow Corning (silicone unit) earnings -19% Y/Y, expected to fall 50% Q/Q in Q3.
- Q2 gross margin was 43%, flat Q/Q and +100 bps Y/Y
- $242M spent on buybacks.
- SG&A spend -7% Y/Y, R&D -3% thanks to cost cuts.
- Q2 results, PR
9:32 AMAt the open
- Dow +0.03% to 98. S&P +0.23% to 1.
- Nasdaq +0.38% to 3612.
- Treasurys: 30-year +0.07%. 10-yr -0.74%. 5-yr -0.27%.
- Commodities: Crude -0.43% to $1323.85. Gold +0.36% to $15577.5.
- Currencies: Euro 0.% vs. dollar. Yen 0.%. Pound +0.36%.
9:29 AMBidding for the rights to the The Simpsons could reach $1B
- 21st Century Fox (FOXA) plans to ask for $1B for a package of the rights to air The Simpsons reruns, according to The New York Post.
- The gaudy figure being thrown out by the company for the long-time Fox network hit show indicates how intense the bidding between media companies for content is expected to become – even for older content.
9:29 AMCF Industries tumbles with fertilizer names
- CF Industries (CF) -3.1% premarket following fertilizer stocks under pressure as Russian producer Uralkali said potash prices could tumble to $300 by year’s end.
- Piper Jaffray cuts its price target to $204 to reflect reduced FY 2014 estimates on weaker pricing and volume outlook uncertainty.
- The news is bad timing for Dan Loeb and his new interest in CF: ”CF’s valuation will not re-rate higher but rather the [fertilizer] sector will re-rate lower to CF.”
9:26 AMSales of Vertex’s Kalydeco impress
- Shares of Vertex Pharmaceuticals (VRTX) rise 2.94% premarket after the company said sales of the cystic fibrosis treatment Kalydeco came in at $99M in Q2 versus Street estimates of ~$75M.
- FY13 Kalydeco sales forecast is raised to $345-360M versus previous guidance of $300-340M. (PR)
- “We believe the cystic fibrosis program is underappreciated and that a higher valuation is justified,” Needham’s Alan Carr says, reiterating a Buy rating and a $95 price target on the shares.
- The stock is still on sale after a partial clinical hold on VX-135 triggered a sell-off last week.
9:20 AMMarket Preview
- U.S. stock futures follow European shares higher ahead of what quantitative sales trader David Thebault calls “the most important economic ‘rendezvous’ of the summer: The (FOMC) meeting, ADP and GDP tomorrow.”
- The S&P Mini is +0.3%.
- Potash Corp plunges 23%, Mosaic is -25% and Agrium is -7.1% due to “the end of the potash world as we know it.”
- Following results, Pfizer is +0.7%, Herbalife +7.9% and Sprint +1.9%.
- Later: FOMC meeting begins, Consumer Confidence, State Street Investor Confidence Index
9:12 AMEnsco’s Q2 earnings up on rising rig rates
- About two-thirds of Ensco’s (ESV) Q2 revenue came from floating rigs, for which average rates rose 13% Y/Y to $399K/day. Rates for shallow-water jackup rigs rose 16%; fleet utilization fell to 84% from 90% a year ago.
- $11B of contracted revenue backlog excluding bonus opportunities.
- Peers Noble (NE) and Diamond Offshore (DO) also reported better than expected Q2 profits, lifted by improved dayrates. (Q2 results)
9:11 AMPfizer’s year-on-year sales growth, by drug: Lipitor -55%, Lyrica +10%
- Here are Pfizer’s year-on-year sales figures by drug for some of its biggest sellers. Lipitor was the biggest percentage loser, but it has company.
- Lyrica $1.134B vs. $1.035B (+10%)
- Prevnar family $969M vs. $996M (-3%)
- Enbrel $960M vs. $988M (-3%)
- Celebrex $715M vs. $659M (+8%)
- Lipitor $545M vs. $1.22B (-55%)
- Viagra $484M vs. $485M (flat)
- Zyvox $346M vs. $343M (+1%)
- Sutent $312M vs. $319M (-2%)
- Norvasc $313M vs. $348M (-10%)
- Premarin family $273M vs. $274M (flat)
- BeneFIX $217M vs. $193M (+12%)
- Genotropin $198M vs. $212M (-7%)
- Vfend $177M vs. $178M (-1%)
- Pristiq $177M vs. $158M (+12%)
- Chantix/Champix $166M vs. $172M (-3%)
- Detrol/LA $155M vs. $205M (-24%)
- Xalatan/Xalacom $147M vs. $209M (-30%)
- PFE +0.2% premarket
9:09 AMSpirit Airlines weak in early trading
- Spirit Airline (SAVE) falls 6.2% in premarket trading after the company announces its Chairman will sell his stake and resign.
- Citigroup has its eyes on the recent developments with the carrier, downgrading the company to a Neutral from Buy and taking the price target down to $37.
9:09 AMKain: Selloff in mortgage REITs is overreaction
- The pummeling in the mortgage REIT (REM) sector is an overreaction to the move in interest rates, says American Capital Agency (AGNC) CIO Gary Kain on the earnings call (presentation slides)
- If investors just looked at historically low valuations (as compared to book value) without knowing the events of the past quarter, they would probably be eager buyers; especially with the wider spreads of today
- Kain is nevertheless respectful of today’s higher volatility, taking the book to over 40% of 15-year mortgages with pay-up risk no longer material; the duration gap remains under one year even with a 200 bp increase in interest rates
- Shares +5.5% premarket
- Previous on AGNC earnings
- Kain-led MTGE +4.2%
- Other mREITs premarket: NLY +1.3%, ARR +1.6%, WMC +2.4%, IVR +1.8%
9:04 AMSoutheast Asian markets creep higher, Thailand lags
- Thai shares (THD) are hit with heavy late selling, sending the SET down 1.3% to a near three-week low. Nomura says “political uncertainties” — which were at the heart of last Thursday’s late-day sell-off — could weigh on the market in the “short to medium term.”
- Across the region: Indonesian shares (IDX, EIDO) lead gainers, rising 0.61% in Jakarta, Philippine (EPHE) and Vietnamese (VNM) stocks are up 0.15% and 0.6% respectively, the Straits Times (EWS, EWSS) notches a fractional gain, and Malaysian shares slip 0.21%.
9:03 AMCan Omnicom rep Coca-Cola and PepsiCo?
- A rather interesting byproduct of the mega-merger in the advertising industry between Publicis and Omnicom (OMC) is that Pepsico (PEP) and Coca-Cola (KO) will now share the same ad firm.
- Though it’s not unheard of that two large rivals will count on Chinese walls to protect their strategies from leaking at an agency, it also stands as a risk for the combined company that it could lose a gigantic account.
9:01 AMOn the hour
- S&P +0.16%.
- 10-yr -0.92%.
- Euro 0.% vs. dollar.
- Crude -0.29% to $1325.75.
- Gold -0.24% to $15521.97.
8:58 AMRio Tinto likely to name Mongolian to run Oyu Tolgoi
- Rio Tinto (RIO) likely will appoint a Mongolian to head its $6.2B Oyu Tolgoi copper and gold mine, Reuters reports, as it seeks to mend ties with the government amid disputes over costs and management at the project.
- Such a move would address a key complaint of the Mongolian government that locals are not well represented in the project’s management.
8:48 AMMore on NextEra Energy’s Q2 results
- NextEra’s (NEE) Q2 revenues of $3.83B was a 4.5% Y/Y increase; operating margin shrank to 25.6% from 27.2% as operating expenses jumped 6.9% to $2.85B.
- Earnings from Florida Power & Light, which accounts for the bulk of NEE’s revenue, rose 11% to $391M.
- Expects FY 2013 EPS in the upper half of its prior forecast for $4.70-$5; continues to expect a 5%-7% CAGR in EPS through 2016. (Q2 results)
8:48 AMLife to develop E. coli and Salmonella food tests for FDA
- Life Technologies (LIFE) has signed a five-year agreement with the FDA to design tests to identify E. coli and Salmonella in food.
- The FDA will use Life Technologies’ Ion PGM Sequencer to generate genome sequence information from defined bacteria, and for strains that will be excluded from detection.
- The FDA will also call on Life particularly for the development of rapid detection kits. (PR)
8:41 AMCBS and Time Warner Cable extend again
- Time Warner Cable (TWC) and CBS (CBS) extend the deadline to work out a new deal until August 2, according to Bloomberg.
- Though CBS went dark for about 30 minutes in key markets late last night, Time Warner Cable was unwilling to pull the plug entirely. The closer that talks linger toward the planned debut of Showtime’s Homeland and NFL football the trickier its gets for the cable operator to make good on its threat of removing CBS content.
- CBS +0.4% premarket.
8:39 AMConocoPhillips makes North Sea discovery
- ConocoPhillips (COP) strikes a 100 ft.-plus gas column at an exploration well on the Lacewing prospect in the eastern North Sea, partner Premier Oil says, in what is seen as a high-risk play.
- The well reached a measured target depth of 14,370 ft., intersecting the target Triassic interval; data will be evaluated to ascertain its commerciality.
- COP is the operator, with a 47.3% stake; Premier, with 20.2%, had farmed out much of its stake to COP as it saw the well as too high risk; BG Group holds 32.5%.
8:38 AMAegerion raises Juxtapid sales guidance, shares rise
- Aegerion Pharmaceuticals (AEGR) impresses with Q2 results, as net sales come in well ahead of expectations.
- CEO Marc Beer sees “significant room for continued growth as [the company] calibrates activities surrounding the launch of Juxtapid in the U.S.”
- AEGR says 215 patients are currently using Juxtapid — meeting the full year goal of 250-300 patients on therapy looks like a forgone conclusion.
- FY13 Juxtapid sales forecast is lifted to $30-35M from just $15-25M previously. Shares +15% premarket. (PR)
- Needham’s Chad Messer called it last week.
8:33 AMJPMorgan settles energy market manipulation probe
- As leaked last week, JPMorgan (JPM) will pay $410M to settle FERC charges it manipulated energy markets in California and the Midwest
- As is typical in these sorts of things, the company neither admits nor denies the violations cited by FERC
8:29 AMMore on Cummins Q2: Net profit drops 12% to $414M
- Cummins’ (CMI) net profit -12% to $414M.
- Sales breakdown: North America +7%, International -4%, due to falling demand in Europe, India, and Mexico, which offset strength in Brazil and China. Engine segment, Cummins’ largest product line, -7% to $2.7B.
- Gross margin narrows to 25.5% from 27.2%.
- Expects 2013 sales to be flat vs 2012, an improvement from a prior forecast of unchanged to -5%; and EBIT of 13-14% of sales.
- Shares +2.6% premarket. (PR)
8:28 AMMore on DineEquity’s Q2
- DineEquity (DIN) reports same-restaurant sales improved 1.3% at Applebee’s and 1.9% at IHOP during the quarter with both chains showing an improvement in the average guest check size.
- The EPS beat is partially attributable to lower general and corporate expenses, $35.6M vs. $37.2M a year ago.
- Full-year guidance is reiterated by the company except for a minor decrease in its estimated general and administrative expenses. (PR)
8:27 AMMore on Occidental Petroleum’s Q2 results
- Occidental Petroleum’s (OXY) $5.96B in Q2 revenues was a 3.4% Y/Y gain; sales at its main oil and gas segment rose 5%, chemical sales increased 1.3%.
- Production climbed 0.8% to average 772K boe/day. Realized prices fell more than 1% for worldwide crude oil while rising 3% domestically; global natural gas liquids prices fell 7.8%.
- Insurgent attacks on assets in Colombia, storms in west Texas and planned turnarounds in the Permian basin held back production.
- Shares +0.5% premarket. (Q2 results)
8:23 AM3D Systems boosting spending to meet demand
- “We made the affirmative decision to step up certain discretionary expenses … We are experiencing heavy demand for our advanced manufacturing and consumer solutions,” says DDD
- Despite higher costs, FY13 EPS guidance of $1.05-$1.20 ($1.06 consensus) on revenues of $485M-$510M ($482M consensus) is reiterated.
- For Q2, gross profit of $62.6M up 45.7% Y/Y with gross margin up 40 bps to 51.8%; R&D cost of $9.6M up 94.4% Y/Y, up 47% from Q1
- Previous: Earnings report
- Shares -3.4% premarket
- Earnings call at 9 ET
8:15 AMMore on Arch Coal’s Q2 results
- Arch Coal’s (ACI) Q2 revenue of $766M is a 20.6% Y/Y decline which the company says is reflective of overall weakness in met coal markets, but it believes current depressed market trends are unsustainable over the long term.
- Says the outlook for U.S. thermal coal is improving, as increased demand and decreased supply are reducing coal stockpiles at U.S. power generators.
- Expects 2013 thermal sales volumes of 130M-137M tons for 2013; lowers its met sales forecast, and now expects to ship 7.7M-8.3M tons during 2013.
- Shares -1.9% premarket. (Q2 results)
8:15 AMAVG taps Mozilla chief as CEO
- AVG Technologies (AVG) names Mozilla Corp. boss Gary Kovacs as CEO to replace the outgoing J.R. Smith, pending the approval of AVG’s shareholders at an extraordinary meeting.
- In addition to Mozilla, Kovacs has worked at Sybase, Adobe Systems and IBM. (PR)
8:15 AMVanda soars on priority review for tasimelteon
- Vanda Pharmaceuticals (VNDA) rises 24% premarket after the FDA accepts the company’s NDA for the Non-24-Hour Disorder treatment tasimelteon and grants the application priority review.
- Advisory committee meeting is November 14, action target date is January 31.
- Stay tuned — questions (from Adam Feuerstein) about the primary endpoint used in a Phase 3 trial sunk the stock in June, much to Lazard’s surprise. Feuerstein is “looking forward” to the FDA panel.
8:15 AMThr rocky road continues for Barnes & Noble
- The revelation by Barnes & Noble (BKS) that its books needed to be restated couldn’t have come at a worse time, says Barclays.
- A potential buyout by Leonard Riggio could be on hold and Nook manufacturing partners could be unsettled by the development.
- Shares of BKS fell 4.6% yesterday and now stand at the mid-point of their 52-week high and low.
8:02 AMAnworth earnings: Book value drops 14.6%
- Anworth Mortgage (ANH) reports (earnings last night) book value of $6.01 as of June 30 vs. $7.04 ninety days previous and last night’s close of $4.97 (a 17.3% discount)
- Net interest spread rises 11 bps to a still-thin 1%
- Average cost of funds declines 8 bps to 0.98%
- Tweak to portfolio composition has ARM MBS of 2 years or less now 19% of holdings vs. 14% a quarter ago
- Portfolio size of $9.45B vs. $9.52B
- 3.1M shares repurchased at average price of $5.65 each (total float is about 144M shares)
- Earnings call at 1 ET. (PR)
8:02 AMShares of Coach slip after results
- Shares of Coach (COH) fall 3.3% premarket after the company’s revenue haul in FQ4 fell short of the estimate of analysts.
- The retailer appears to be losing traction in the U.S. with comparable store sales moving negative for 2 of the last 3 quarters and key execs bailing out.
- In North America, direct sales were flat for the quarter, indicating online channels might be under-performing.
- Analyst take: Michael Kors (KORS) and Tony Burch may have taken more market share during the quarter.
8:00 AMOn the hour
- S&P +0.23%.
- 10-yr -0.02%.
- Euro +0.24% vs. dollar.
- Crude -1% to $103.51.
- Gold -0.36% to $1324.75.
7:58 AMBP scraps sale of U.S. wind farm business
- BP says it will keep its U.S. wind farm business after failing to attract an acceptable bid; reports indicated BP had been hoping for $1.5B.
- A sale was seen as a continuation of the retreat of big oil companies from renewable energy while oil and gas projects offer better returns, and would have contributed to BP’s mounting oil spill costs. (Q2 earnings)
- SNL says the cancellation will raise questions about whether BP’s priorities have changed again.
- Shares -5.1% premarket.
7:58 AMMerck’s sales fall on patent expiries
- Merck’s (MRK) worldwide revenue falls 11% Y/Y as Singulair sales dip 80% from Q2 2012 — the asthma treatment lost patent expiration in the U.S. last August and in Europe in February.
- Overall, Q2 pharmaceutical sales fall 12% to $9.3B.
- Revenue growth (including FX impact) from other key products: Januvia, 1%; Zetia, 3%; Remicade, 2%; Junumet, 16%; Vytorin, -6%; Isentress, 4%; Gardasil, 18%; Proquad, M-M-R II, Varivax, 7%; Nasonex, 11%; Consumer Care, -11% (impact of terminating distribution arrangements in China).
- Outlook: FY $3.45-3.55/ share; revenue -5 to -6% Y/Y. Shares -0.19% premarket. (PR)
7:55 AMMore on Waste Management Q2: Net income +17.3%
- Waste Management’s (WM) net income +17.3% to $244M as revenues rise 1.9% to $3.53B.
- Internal revenue growth 2.1%.
- Income from operations in traditional solid waste business +$47M.
- SG&A cost savings $21M; operating expenses +$51M.
- Net cash from operating activities $545M, increased free cash flow to $347M
- Average recycling commodity prices -12.5% on year.
- Expects recycling operations to hurt FY results by $0.08/share vs 2012, up from original forecast of $0.02.
- However, still expects FY adjusted EPS of $2.15-2.20 vs consensus of $2.18, and free cash flow of $1.1-1.2B. (Previous) (PR)
7:50 AMGoodyear Tire’s Q2 impresses
- Goodyear Tire (GT) says it recorded the highest level of operating income ever in North America and Asia Pacific as new products and global corporate integration contributed.
- Segment operating margin improved 160 bps Y/Y to 9.3% in North America and increased 200 bps in Europe, Middle East, and Africa to 3.2%.
- The company says it expects accelerating tire unit volume in H2 which will help overall 2013 volume be unchanged compared to a year ago. (PR)
- GT +7.5% premarket
7:48 AMHess sells energy marketing business for $1.03B
- Hess (HES) agrees to sell its energy marketing business to British utility Centrica’s (CPYYF.PK) North American subsidiary Direct Energy Business $731M in cash plus net working capital of ~$300M.
- The sale is part of Hess’ plan to focus on its E&P activities, and brings YTD asset sales to $4.5B; Hess says the sale will allow it to start buying back shares under an existing $4B repurchase program.
- Centrica says the deal makes Direct Energy the largest business gas supplier on the U.S. east coast and the second largest business supplier in the U.S. retail power market.
7:39 AMIt’s all about book value at American Capital
- American Capital Agency (AGNC) +4.4% premarket after book value fell just 11.8% in Q2 to $25.51 (with the stock yesterday closing at a 14.3% discount)
- Despite a near-calamitous couple of quarters, the company reports access to funding was uninterrupted and the average “haircut” on repo borrowings was unchanged
- Funding costs of 1.43% vs. 1.28% in Q1 due to entering into longer-dated swaps
- Falling book value required portfolio size to be cut to maintain leverage level
- $91.7B investment portfolio vs. $103.6B in Q1; leverage still increases to 8.5x from 8.1x
- Conference call set for 8:30 ET
7:33 AMMore on Coach’s FQ4
- Sales in North America rose 6% to $825M while international sales gained 7% to $386M with China a strong contributor.
- Coach (COH) held the line on margins, but appears to have lost market share in the U.S.
- Two key execs – North American head Mike Tucci and COO Jerry Strikzke – will leave the company. (PR)
- COH +0.3% premarket
7:30 AMCommunity Health to acquire Health Management for $3.9B
- In a deal that’s been expected for a while, Community Health Systems (CYH) agrees to acquire Health Management Associates (HMA) for $3.9B in cash and shares.
- The offer of $13.78 a share is lower than the latter’s close of $14.92 yesterday.
- Community Health is also taking on $3.7B i debt, taking the total deal to $7.6B.
- Health Management’s shares are -4.8% to $14.20. (PR)
7:19 AMMore on Aetna Q2: Coventry acquisition boosts earnings
- Net profit +17% to $536M, boosted by the closure of Aetna’s (AET) $6.9B acquisition of Coventry Health Care in May.
- Medical membership +21% to nearly 22M people, including 3.7M from Coventry
- Books $101.3M in charges related to the Coventry deal.
- Now expects 2013 adjusted EPS of $5.80-5.90 per share, up from previous guidance of $5.70-5.85 and vs consensus of $5.80. (PR)
7:12 AMAnalysts warming up to Aeropostale
- Topeka upgrades Aeropostale (ARO) to a Buy rating.
- A new price target of $18 on ARO is assigned by the investment firm.
- In general, the analyst community has turned more bullish on the retailer with more reports out that fall fashion lines look promising.
7:08 AMFutures inch higher as FOMC meets and earnings roll in
- S&P 500 (SPY) futures +0.2% and Nasdaq 100 (QQQ) +0.4%
- Europe is moderately higher and Asia was mostly green overnight
- The FOMC begins a 2-day policy meeting this morning
- Pfizer is higher by 1% premarket after reporting earnings earlier
- The 10-year Treasury yield is steady at 2.59%
7:07 AMNo change expected from Fed
- The FOMC is due to hold its latest policy meeting today and tomorrow, when policy makers are expected to debate how best to prepare markets for a tapering of QE, although they’re also ultimately expected to decide to do nothing for the time being.
- Issues up for discussion include a proposal to change the Fed’s forward guidance on rates and a stronger commitment to fight low inflation.
- Markets went all a flutter last time around after Ben Bernanke said the bond-buying would end in mid-2014, which forced officials to make speeches that the Fed would still be there to support the economy.
- Hanging over the meeting is Bernanke’s expected departure in January.
- The post-meeting statement is due out tomorrow at 2 pm.
7:06 AMChrysler hits late speed bump with new Jeep Cherokee
- Chrysler (FIATY.PK) postpones a media unveiling of the 2014 Jeep Cherokee after running into some late issues with the vehicle’s powertrain.
- The automaker expects to stay on track for a September launch in U.S. showrooms for the key model.
7:05 AM“The end of the potash world as we know it”
- BMO Capital Markets calls the breakdown of the Belarus Potash Company (BPC) cooperative between Uralkali (URALL.PK) and Belaruskali “the end of the potash world as we know it.”
- “Discipline and price-over-volume leadership in the potash industry seem to have crumbled, and we expect a major exit by investors out of potash producers (POT, MOS, ISCHF.PK, IPI, AGU, SQM and CMP) and the fertilizer sector in general,” firm says. “We believe potash earnings estimates will move materially lower, but industry multiples will likely lower too as investors question why potash producers still deserve historical premium multiples over diversified miners.”
- One final note: “Perhaps Uralkali is simply attempting to shock the market to encourage Belaruskali to reconsider marketing together, but these discussions would likely have already happened behind the scenes.”
- Premarket: POT -13%. MOS -12.8%. ISCHF.PK -16.5%. AGU -12.5%. SQM -3%.
7:01 AM7-Eleven to expand in U.S.
- The 7-Eleven retail chain is about to enter a growth phase in the U.S., according to Seven & I Holdings CEO Toshifumi Suzuki.
- The company plans to make acquisitions and raise the quality of stores in an effort to mimic the success of the chain in parts of Europe.
- The aggressive push by 7-Eleven could affect the plans of Dunkin Brands’ (DNKN) and The Pantry (PTRY) which are also in an expansion mode.
7:01 AMTD Bank to report loss from insurance unit
- The impact of severe weather has TD Bank (TD) expecting to report an after-tax Q3 loss of C$240M-C$290M in its Wealth and Insurance segment
- Works out to $0.26-$0.31 per share vs. Q2 earnings of $1.78
- Conference call concerning announcement to be held at 8:30 ET
- Earnings are due on August 29
7:00 AMOn the hour:
- S&P +0.23%.
- 10-yr -0.05%.
- Euro +0.04% vs. dollar.
- Crude -0.66% to $103.86.
- Gold -0.52% to $1322.65.
6:51 AMChanges could be brewing at Spirit Airlines
- Spirit Airlines (SAVE) Chairman William Franke plans to sell his stake in the firm through his P-E firm and resign from the board.
- The twist: The development comes just days after Republic Airways said it sold its Frontier Airlines unit to an undisclosed third party.
6:44 AMTime Warner Cable blinks first in fee dispute with CBS
- Talks between CBS (CBS) and Time Warner Cable (TWC) broke down late in the night leading to CBS stations being pulled from cities such as New York and Los Angeles, but within the hour the cable giant reversed itself to halt the blackout.
- The companies say discussions are still ongoing.
- Some reports indicating CBS is still asking for a 25% hike in carriage fees.
- Japan +1.5%.
- Hong Kong +0.5%.
- China +0.7%.
- India -1.2%.
- London +0.1%.
- Paris +0.1%.
- Frankfurt +0.2%.
5:06 AMEuropean stocks rise
- European shares are higher amid heavyweight earnings reports and following data which showed that German consumers are at their most optimistic in six years.
- EU Stoxx 50 +0.7%, London +0.3%, Paris +0.1%, Frankfurt +0.4%, Madrid +0.2%, Milan +0.6%.
4:52 AMMore on Pfizer Q2: Net income jumps more than fourfold
- Net income jumps more than fourfold to $14.1B, or $1.98 a share, boosted by the spinoff of Pfizer’s (PFE) Zoetis animal-health unit and a patent settlement with Teva and Sun Pharmaceutical over Pfizer’s Protonix acid reflux medicine.
- Raises FY reported EPS forecast to $3.07-3.22 from a prior forecast of $1.44-1.59, reflecting the gain from Zoetis and the patent deal.
- Reiterates adjusted EPS guidance of $2.10-2.20 vs consesnus of $2.16 and revenue of $50.8-52.8B vs $51.83B. (PR)
4:32 AMFresenius Medical Care Q2 net profit fallls 9%
- Fresenius Medical Care (FMS): Q2 net profit -9% to $263M, below forecasts for $280M. Adjusted net profit +2% to $272M.
- Net revenue +5.4% to $3.61B.
- Organic revenue +5%.
- Continues to aim for 2013 net income of $1.1-1.15B. (PR)
4:22 AMMore on Sprint Q2: Net loss widens
- Net loss widens to $1.6B from $1.4B a year earlier.
- Results include depreciation of $430M and charges of $623M related to the shutdown of Nextel’s platform.
- Average revenue per subscriber on the Sprint network rose to $64.20 from $63.38 a year earlier.
- Sprint lost a net 1.05M contract subscribers in Q2 vs 246,000 a year earlier, due to shutting down Nextel. In contrast, Verizon added 941,000 in Q2 and AT&T 551,000.
- Wireless-service revenue +8% to a record $7.2B.
- Sold 1.4M iPhones in Q2, down from 1.5M in Q1.
- Postpaid churn from Sprint brand increased to 1.83% from 1.69% a year earlier. Total company postpaid churn 2.63% vs 1.79%.
- Expects 2013 adjusted operating profit before depreciation and amortization of $5.5-5.7B, up from a previous forecast of $5.2-5.5B. (Previous) (PR)
4:06 AMNYSE Euronext Q2 earnings beat forecasts
- NYSE Euronext (NYX): Q2 EPS of $0.63 beats by $0.05. Revenue of $611M (+1% Y/Y) beats by 9.5M.
- Net profit +38% to $173M, boosted by cost cuts and one-off gains.
- NYSE Euronext is being bought by IntercontinentalExchange (ICE) for $8.2B. (PR)
3:59 AMSantander H1 net profit +29% to €2.25B
- Santander (SAN): H1 net profit +29% to €2.25B, as expected.
- Net interest income -13% to €13.37B.
- Profits in Q2 boosted by lower provisions in Spain, although this was offset by weaker performance in Latin America.
- Plans to always maintain a “fully-loaded” Basel III capital ratio of 9%, having previously said that it would reach a ratio of 8% by the year-end. (PR)
3:55 AMPotash producers plunge over Russian spat
- Potash producers plunge in overseas trading after Russian potash producer Uralkali (URALL.PK) says it is leaving its JV with Belaruskali, accusing Belaruskali of violating the terms of their agreement. Uralkali will now export deliveries via its own Swiss-based Uralkali Trading. (statement)
- On a conference call, CEO Vladislav Baumgertner said the move could trigger a drop in global potash prices to below $300/tonne in H2, from a current $400/tonne.
- Uralkali and Belaruskali’s JV, Belarus Potash Company (BPC), accounts for 43% of the global potash export market.
- Uralkali -14.2% on the MCX. Israel Chemicals (ISCHY.PK, ISCHF.PK) -10.7% in Tel Aviv. K S AG -16% in Paris.
- North American fertilizer stocks in play: POT, AGU, MOS
3:49 AMAlcatel-Lucent Q2 net loss widens; Qualcomm to buy stake; shares leap
- Alcatel-Lucent (ALU): Q2 net loss widens to €885M from €254M last year and vs expectations of €280M; operating profit €24M vs loss of €86M and consensus for loss of €39.4M.
- Revenue +1.9% to €3.61B vs forecasts of €3.48B, with sales boosted by a large increase in revenue from North America.
- Takes €552M impairment charge related to the reorganization of the company’s wireless business and €194M restructuring charge.
- Cuts €120M in costs, cash burn drops to €248M from €517M.
- Qualcomm (QCOM) is buying a small stake in Alcatel-Lucent as part of an R&D pact to make new wireless transmitters for homes and offices; ALU plans to seek a total of 3-5 strategic partners that will acquire small holdings.
- Shares +7.6% in Paris. (PR)
3:32 AMDeutsche Bank Q2 net profit unexpectedly halves to €335M, shares sink
- Deutsche Bank (DB): Q2 pretax profit -18% to €792M, badly missing consensus of €1.3B. Net profit -49% to €335M vs forecasts of €767.6M. Revenue +2% to €8.2B.
- Increases legal provisions by €630M to €3B and expects “settlements to accelerate in the coming quarters,” although the bank doesn’t provide details on which issues are set to be resolved.
- Deutsche Bank plans to reduce assets to bring its leverage ratio to 3% and has identified €250B worth to cut. Shares -4% in Frankfurt. (PR)
3:17 AMBP Q2 adjusted net profit $2.71B
- BP (BP): Q2 adjusted net profit drops to $2.71B from $3.6B a year ago and misses expectations of $3.41B.
- $20B Gulf of Mexico oil spill compensation fund has just $300M left, with costs for provision increasing by $1.4B.
- Claims beyond that which the fund can pay will come from future profits.
- Results also hurt by falling oil prices, a higher tax rate and lower income from Russia. (PR)
3:00 AMBarclays H1 pretax profit -17%, to issue £5.8B in new shares
- Barclays (BCS): H1 pretax profit -17% to £3.59B. Statutory attributable profit £671M vs £148M a year earlier. Adjusted attributable profit -25% to £2.06B.
- To issue £5.8B in new shares in order to meet regulatory requirements to boost its capital, and will offer stockholders one new share for every four they own at 185 pence each, well below the bank’s closing price of 309.05 pence yesterday.
- Barclays will also issue £2B of bonds that can be converted into shares or will be wiped out if the bank gets into difficulties. (PR)
- Sets aside another £1.35B for mis-selling Payment Protection Insurance and £650M for compensation related to interest-rate hedging products.
- Remain cautious about the environment, with the focus remaining on costs and capital.
- Q2 dividend 1 pence a share. (PR)
2:08 AMUBS confirms Q2 net profit of 690M francs; to repay bailout loan
- UBS (UBS): Q2 net profit +32% to 690M Swiss francs ($740.9M), as flagged last week.
- Swings to pretax profit of 775M francs from loss of 92M francs a year earlier.
- UBS plans to repay a loan and repurchase shares in a fund created as part of the bank’s 2008 bailout. The company can pay $1B plus 50% of the fund’s gains to acquire it from the Swiss National Bank; the firm expects to carry out the deal later this year. The transaction will add 90 bps to UBS’s capital ratios. (PR)
12:14 AMAussie slides on Stevens comments
- The aussie (FXA) falls 1.4% against the dollar to 0.9074 on comments by RBA Governor Glenn Stevens.
- Recent inflation data provide some scope for further rate cuts, Stevens says.
- “The recent decline in the exchange rate seems to make sense from a macroeconomic perspective,” he notes, adding that “it would not be a major surprise if a further decline occurred over time.” By “over time” Stevens apparently meant over the next half hour or so.
12:10 AMNotable earnings after Tuesday’s close
- ACAS, ACMP, AFL, AMGN, ANAD, APU, BOOM, BSMX, BWLD, BXP, CALX, CAP, CBI, CENX, CHMT, CLD, CSE, CVD, DRIV, ELGX, EQR, EXTR, FARO, FISV, FTNT, GDOT, GNW, GPRE, HBI, HR, HT, IACI, INVN, ISIL, JIVE, KIM, LOPE, MAKO, MERU, MKTO, MSPD, MTGE, MWA, MX, NANO, NCR, NEU, NSR, NUVA, OIS, OKE, OKS, POL, PRAA, QCOR, QGEN, RBC, RPXC, RVBD, SIMG, SKT, SM, SNCR, SYMC, TRLG, TRMB, TTS, TTWO, UGI, ULTI, VRSK, WFT, WNC, XXIA
12:05 AMNotable earnings before Tuesday’s open
- ACI, ADS, AET, ARQL, AUDC, BLC, BP, BYD, CIE, CMI, COH, CVLT, DB, DDD, DIN, DISCA, DSX, ECL, ESV, ETR, EZPW, FIS, GLW, GNRC, GT, GTI, GTLS, HCP, HEP, HRS, HW, IPGP, JBLU, KLIC, MCGC, MDC, MLM, MRK, MSO, MWV, NEE, NLSN, NOV, NTLS, NYX, ODP, OSK, OXY, PBI, PEG, PES, PFE, ROK, S, SAN, SNH, TRI, TRW, UBS, UDR, VSH, WLK, WM, WU, XYL