Wednesday, July 20, 2011
VMW - Raising ests, tgt fm $110 to $125.after ELA renewal cycle drives upside amid strong int'l growth & vShere adoption.
RVBD - Lowering ests, tgt fm $50 to $40 after miss due to Euro weakness, but strong guidance = robust Nor Amer pipeline. Buy.
ISRG - Raising ests, tgt fm $422 to $429 after beat / raise on 30% procedure growth & robot unit upside.
SYK - Raising ests after rev beat on stronger hip ortho & patient handling biz, but mgns disappoint, largely due to currency & ASP declines.
FRX - Lowering ests on weaker Savella sales. Qtr largely inline, but 8/18 sharehold vote for Bd of Dir's overshadows fundamentals.
ANH - Lowering ests on lower future reinvestment rates & resettling of coupons for seasoned ARM's.. Stock is dead money near term.
Healthcare Facilities - Expect weak econ backdrop & sluggish volumes/mix. UHS & HCA remain top picks . THC cheapest in group @ 5x 2012E EV/EBITDA , laza
Bank of America probably won't have to raise new capital, says We
lls Fargo - After Bank of America reported Q2 adjust
Bank of America probably won't have to raise new capital, says Wells Fargo - Aft
er Bank of America reported Q2 adjust
Bank of America probably won't have to raise new capital, says Wells Fargo -
After Bank of America reported Q2 adjusted EPS that was at the high end of
its guidance, Wells Fargo thinks the bank can meet international capital
requirements by late 2014 without issuing more stock. The firm believes that
the market is overly discounting a capital raise and it maintains an
Outperform rating on the stock.
Monsanto Co. (MON) Buy: Regaining momentum, raising PT, adding to
Conviction List 1
Intuitive Surgical, Inc. (ISRG): Thesis broken - more legs to the story than
contemplated; Neutral 2
UnitedHealth Group (UNH): What we were looking for in the right amount 3
Americas: Communication Services: Cable/Sat preview: Seasonal pressures, Buy
CMCSA as metrics lead 4
Taubman Centers, Inc. (TCO): First Take: Strong 2Q as mall sales reach new
VMware, Inc. (VMW): 2Q2011 Results: On the edge of glory, reiterate Buy 6
Apple Inc. (AAPL): iOS devices drive significant 3Q beat, welcoming the post-PC
era 7 @ gs
1. Twenty-eight banks would face capital surcharges if international rules to rein in too-big-to- fail lenders were applied today. HSBC, C, DB and BNP Paribas may face the highest additional capital requirements. Other lenders that may be subject to the highest surcharge include BAC, JPM, BCS, & RBS. Banks that fail to meet the surcharge rules face curbs on paying out dividends.
2. Global regulators� decision to stop banks using contingent convertible bonds to meet planned capital rules may cut the market for the securities by about half.
1. European officials are considering steps previously rejected by Germany, including the use of precautionary credit lines, to prevent the spread of the region�s debt crisis.
2. Greek Prime Minister Papandreou says Europe�s leaders need to show tomorrow that they can resolve the EU debt crisis to avoid a contagion enveloping Italy and Spain.
? EUROPEAN BONDS� Spanish and Italian bonds rallied ahead of the EU summit.
1. the U.S. is close to a debt-ceiling compromise.
2. President Obama will renew talks at the White House this week, praised bipartisan Senate proposal for a $3.7t debt-cutting plan.
? CHINA� China said that it can allow more yuan moves without jeopardizing its foreign-exchange reserves after letting the currency rise today to a 17-year high against the dollar.
? B.O.E.� BOE Voted 7-2 as Majority Saw Less Need for Near-Term Rate Rise
? CANADA-- Canadians banks, ranked the soundest in the world, aren�t on a list of 28 lenders that could face capital surcharges if too-big-to-fail rules were applied today.
? KUWAIT-- KUWAIT'S LONG-TERM RATINGS RAISED TO AA FROM AA- BY S&P
? RUSSIA� The ruble is tracking oil more closely than ever, underscoring the difficulties Russia is having in cutting the economy�s reliance on the commodity.
? U.K.-- U.K. Lawmakers Criticize Police, News Corp. Over Phone Hacking
? SOMALIA� The UN declared a famine in two regions of Somalia amid drought and conflict that have left 3.7MM people, almost half the country�s population, in need of humanitarian assistance.
? SERBIA-- Serbia Captures Last Remaining War Crimes Fugitive Hadzic
THOUGHTS OF THE DAY
? MORTGAGES� The U.S. Treasury Department is exploring a plan that could help 1MM or more homeowners avoid foreclosure. The proposal is aimed at promoting modifications of delinquent or defaulted home loans, including write downs of principal.
? MERGER & DEAL NEWS�
1. Ecolab to Buy Nalco for $5.4 Billion to Add Water Treatment
2. Cnooc to Acquire Failed Opti Canada to Add Oil Sands Assets
3. Zillow Raises $69.2 Million in IPO, Pricing Shares Above Range
4. Wisconsin Borrowing Costs Fall on Curbs to Unions
? BAC� Moynihan�s No-New-Capital Stance Draws Scrutiny After BAC Loss
? BLK-- the world�s biggest money manager, said second-quarter profit increased 43% as fees climbed along with the assets it oversees for investors.
? CRUDE� The Dodd-Frank Act , aims for the first time to bring transparency to oil derivatives as part of new rules for the $601T global swaps market. The CFTC & SEC are writing new regulations designed to limit risk and boost transparency after the largely unregulated trading in derivatives helped fuel the 2008 credit crisis.
1. Oil Gains a Second Day on Shrinking Crude Stockpiles
2. Copper Drops
3. Soybeans surge to the highest level since 2008.
4. Corn Gains for Second Day
5. Coffee Falls
6. Sugar Rises
7. Japan Can�t Rule Out Possibility Contaminated Beef Was Exported
8. Zinc Trades Near Three-Month High
9. Rice From India at $400 a Ton May Cut Global Prices
10. Rubber Supply Tightness to Last Until 2018
11. Ethanol Rebounding on Tax Credit
? AAPL� Apple, the world�s second-biggest company by market value, said profit more than doubled last quarter. Apple Shares Jump After IPhone, IPad Sales Fuel Profit
? AMR-- agreed to buy 460 single-aisle jets from Airbus & BA in the industry�s biggest-ever order that lets Airbus break BA�s two-decade hold over the U.S. airline.
? NOK-- Nokia�s Handset Sales Slump May Cut Into $9 Billion Cash
? UTX� Sees Year EPS $5.35-$5.45, Saw $5.25-$5.40, Est. $5.44
? CMG-- Chipotle Profit Trails Analysts� Estimates as Costs Rise
? MO� Altria Wages Last-Ditch Fight to Keep Tax Dodge Found �Abusive�
? FUTURES�1328.50, PLUS 7.30.
? NEW HIGHS: 146. AAPL, CMG, ATRI, AMZN, IBM, MSTR, WYNN, CRM, FOSL, EL, VMW, UA, ENR, COG, KO, BWLD, DV, RRC, LULU, XHKP, ROC, HAL, ALXN, JWN, SWN, HOG, CASY, WDFC, KMT, SUG, CPX, JAZZ, NOBE, PTEN, DOX, WAC, MIND, DELL, ZAGG,
? NEW LOWS: 47. GS, NTRS, CMA, LUV, BAC, LCC, EK.
? OVERBOUGHT: 124.
? OVERSOLD: 150.
networking, saying today it's buying privately held Force10 Networks. DELL
calls Force10 a leader in high-performance data-center networks and notes
technology complements its data-center offerings -- a big area of DELL's
focus as it moves away from its core PC operations. Force10 purchase isn't
quite the news Brocade (BRCD) investors wanted to hear. BRCD, which also
provides networking, had often been mentioned as a target for DELL. BRCD
slips 4% to $6.04 premarket. DELL off a fraction at $17.45.
Watch Caterpillar, Terex on Weak June Architecture Billings Data
2011-07-20 12:32:55.180 GMT
By Arie Shapira
July 20 (Bloomberg) -- June Architecture Billings Index
(ABI) fell to 46.3 vs May 47.2, 4th consecutive decline; reflects continued decrease in demand for design servies.
* New projects inquiry index rose to 58.1 vs May 52.6; highest
reading in 3 months
* American Institute of Architects Chief Economist Kermit
Baker: �This seems to be a case of not thinking it can get
any worse - and then it does�
* Baker on consequences of U.S. default: �We are likely
looking at a catastrophic situation for a sector that
accounts for more than 10% of overall GDP�
* Stocks w/ U.S. construction exposure to watch include CAT,
CNH, DE, HEES, MTW, OSK, RRR, TEX, URI
* Earnings watch: URI last night, TEX tonight, RRR 7/21
postmkt, CAT 7/22 premkt
* NOTE: Above 50 indicates increase in billings; below 50
indicates contraction. Commercial construction typically
follows billings index by 9-12 mos: AIA ABI table:
Yesterday�s rally caused a major change in the breadth with the Up Volume Ratio surging to 80% (80% of all the volume on the NYSE was in stocks that closed higher on the day)�1328 big level of resistance on the S&P a break above that could push us to 1340.30 (76.4% FIBO of May top to June bottom)�support will be
1323.47 (61.8% FIBO) see what the 10AM Existing homes # brings street looking for 4.9M for June +1.9% MoM... laza
Skullcandy 9.4M share IPO priced at $20.00 - The deal size was in
creased to 9.442M shares from 8.49M shares and priced
Skullcandy 9.4M share IPO priced at $20.00 - The deal size was increased to 9.44
2M shares from 8.49M shares and priced
Skullcandy 9.4M share IPO priced at $20.00 - The deal size was increased to
9.442M shares from 8.49M shares and priced above the $17.00-$19.00 range.
BofA/Merrill and Morgan Stanley acted as joint book running managers for the
According to SentimenTrader.com, a strong report from AAPL when the Nasdaq is near a high usually does not produce sustained momentum. In fact, there has typically been a substantial pullback in the month that follows. According to SentimenTrader, "There have been 11 times since 1997 that Apple gapped up by more than 3% the morning after earnings, when the Nasdaq 100 (NDX) was within 3% of a 52-week high. During the next month, the NDX dropped at least -2% every time, at least -4% eight times and at least -9% six times."
*Special thanks to Option Radar, BMO Capital, MEB Options, LiveVolPro, CBOE, Option Monster, T.O.P. group, and all of the options desks and traders we work with to provide the option flow!
No position at this time. Position declarations are believed to be accurate at time of writing but may change at any time and without notice.