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44441381 nov-30-2010-free-intelligent-investors-us-edition

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  • 1. 30 November 2010 The Intelligent Investor U.S. The Economic Monitor Series. Free Edition. INSIDE THE REPORT MARKETS AT A GLANCE Stock recommendations and price targets from top brokerage  U.S. stocks fell in a choppy session, but showed resilience in the firms face of Europes debt crisis, recovering some of their losses on more encouraging signs from the U.S. economy. The DJIA fell Analysis and views on US consumer confidence hits five-month 46.47 points, or 0.42 percent, to end at 11,006.02. high  Benchmark 10-year Treasury notes last traded up 6/32 in price for Economic Indicator Watch along with Graphs a yield of 2.80 percent, down from 2.83 percent late Monday. List of companies earnings which hit and miss the analysts’  The euro was last down 1 percent against the dollar at $1.2988 expectations from $1.3002 before the news broke, though it remained well off the session low of $1.2968 touched earlier in the global trading Important Events Scheduled on December 01 day.  Oil fell, as concerns that Europes debt crisis will widen batteredEconomic Events the euro and added to worries about Chinese oil demand. U.S. crude oil for January delivery fell $1.62, or 1.89 percent, to settle at Federal Reserve Bank of Dallas President Richard Fisher speaks on $84.11 a barrel, then extended its losses to $83.55 in post- Federal Reserve operations and economic update before a settlement trade. community forum hosted by the Federal Reserve Bank of Dallas - 1800 GMT  Gold rallied over 1 percent to a 2-1/2 week peak and euro-priced bullion set a fresh record high as concern over sovereign debt Federal Reserve Vice Chair Janet Yellen speaks on "Fiscal levels in the euro zone fuelled buying of the metal as a safe store Responsibility and Global Rebalancing" before the Committee for of value. Spot gold was trading at $1,385.50 an ounce at 1643 Economic Development 2010 International Counterparts GMT against $1,368.09 late in New York on Monday. Conference - 1410 GMT Federal Reserve to release periodic Beige Book survey of U.S. STOCK INDICES economic conditions - 1900 GMT INDEX LAST CHNG % CHNG Senate Banking hearing on Problems in Mortgage Servicing From DJIA* 11006.02 -46.47 -0.42 Modification to Foreclosure. U.S. FDIC Chairman Sheila C. Bair, Federal Reserve Governor Daniel K. Tarullo, Acting Director of Nasdaq* 2498.23 -26.99 -1.07 Federal Housing Finance Agency Edward DeMarco and Others to S&P 500* 1180.55 -7.21 -0.61 participate in a Panel - 1430 GMT NYSE Composite 7430.94 -52.4 -0.7Corporate Events Global Dow 1949.81 -12.96 -0.66 * CLOSING VALUES No earnings scheduled for release CURRENCIESTop Stories INDEX LAST PRIOR Consumer, manufacturing data shows gains Euro (EUR/USD) 1.298 1.3123 Google close to its largest acquisition U.K. Pound (GBP/USD) 1.5551 1.5574 Japanese Yen (USD/JPY) 83.69 84.24 ABB to buy Baldor Electric All prices are at 04:16 PM EST FDA raises concern on AstraZeneca cancer drug FUTURES Morgans seeks new CEO LAST CHANGE Merck elevates Frazier to succeed Clark as CEO Crude Oil 83.78 -1.95 Lowes affirms its outlook Natural Gas 4.212 0.002 Gold, Dec. 1385.7 18.2 U.S. oil falls toward $85 as dollar rises Copper 380.95 4.2 Wheat 690.5 0 All prices are at 04:06 PM EST
  • 2. The Intelligent Investor - U.S.STOCK RECOMMENDATIONS BY BROKERAGE HOUSESBROKERAGE/COMPANY ACTIONS RATINGRBCAltera Corp Raises price target to $34 from $30 Sector performCamden Property Trust Raises price target to $59 from $54 Top pickPost Properties Raises price target to $40 from $32 OutperformSeagate Technology Cuts price target to $13 from $15 Sector performUDR Raises price target to $24 from $22 Sector performSimmons & Co.Diamond Offshore drilling Cuts to underweight from neutral UnderweightRowan Companies Cuts to neutral from overweight NeutralMacquarieDow Chemical Co Recommends price target of $38 OutperformEastman Chemical Recommends price target of $95 OutperformBernsteinEmerson Electric Raises price target to $62 from $60 Market performBarclaysAltera Corp Raises price target to $38 from $34 Equal-weighteBay Raises price target to $29 from $27 Equal-weightRaymond JamesAltera Corp Raises price target to $54 from $48 Strong buySemtech Corp Raises price target to $28 from $22 OutperformCredit SuisseInternational Game Technology Adds to U.S. focus list —StifelAltera Corp Raises price target to $42 from $36 BuyNuPathe Recommends price target of $13 BuyJanney Capital MarketsKimberly Clark Recommends price target of $75 BuyBofA MerrillVerisign Inc Raises price target to $37 from $34 NeutralArgusChesapeake Energy Cuts to sell from hold SellJefferiesAltera Corp Raises price target to $35 from $29 HoldITW Recommends price target of $60 BuyBeacon Roofing Supply Raises price target to $18 from $16 HoldBrightpoint Cuts to hold from buy HoldBravo Brio Restaurant Recommends price target of $22 BuyCoresite Realty Corp Recommends price target of $17 BuyCarisWestern Digital Raises price target to $40 from $36 Above averageDeutsche BankWestern Digital Raises price target to $38 from $32 —UBSWynn Resorts Raises price target to $133 from $129 BuyDisclaimer: The views and investment tips expressed by investment experts are their own, and not that of IBTimes or its management. We advise users to check with certified experts beforetaking any investment decisions.
  • 3. The Intelligent Investor - U.S. TOP STORIESConsumer, manufacturing data show gainsU.S. consumer confidence rose in November to its highest in five months, said the Conference Board. Meanwhile, U.S. Midwestbusiness activity grew faster than expected. The Conference Board said its index of consumer attitudes increased to 54.1 inNovember, the strongest since June, from a revised 49.9 in October. In another report, the Institute for Supply Management-Chicagos business barometer rose to 62.5 in November, up from 60.6 in October. Standard & Poors/Case-Shiller compositeindex on Tuesday showed home prices in 20 metropolitan areas declined 0.8 percent in September from August on a seasonallyadjusted basis, more than the decline of 0.3 percent expected by economists.Google close to its largest acquisitionGoogle is inching towards its largest acquisition to date as it is going to buy e-commerce coupon websiteGroupon Inc for as much as $6 billion, the New York Times said on Tuesday. Sources familiar with the matter tellthe New York Times and All Things Digital that Google has offered between $5 and $6 billion for theacquisition of online daily deal site Groupon.Groupon, a privately held, Chicago-based company was launched about two years ago. The site offers dailydiscounts on services, goods, and food from local retailers with a catch: to get the deal, a minimum number of users must sign up forthe sale, introducing a social element to the bargain shopping.ABB to buy Baldor ElectricSwiss engineering group ABB is to buy U.S. industrial motors firm Baldor Electric Co for a deal of $3.1 billion or £2 billion. The dealwill give ABB a chance to capitalize on a global push for energy efficiency and boost its North American presence. ABB will pay $63.50a share, a 41 percent premium to Baldors closing price on November 29. Under the deal, ABB also assumes $1.1 billion in net debt.ABB expects the deal to yield more than $200 million annually to earnings before interest, tax, depreciation and amortization (EBTIDA)by 2015. A deal termination fee was set at $105 million.FDA raises concern on AstraZeneca cancer drugThe U.S. Food and Drug Administration staff reported concerns on the cancer drug by AstraZeneca. The staffsaid the cancer medicine carries "substantial toxicity" for patients with inoperable thyroid cancer. The U.S. Food andDrug Administration staff said they would ask an advisory panel to consider heart-related risks and other potentialside effects from the drug, vandetanib.Morgans seeks new CEOU.S. boutique hotel operator Morgans Hotel Group said it is looking for a new chief executive officer to succeed Fred Kleisner.Kleisner has indicated his willingness to serve beyond the expiration of his term which is due on December 31.Merck elevates Frazier to succeed Clark as CEOMerck & Co president Kenneth Frazier will succeed Richard Clark as the chief executive officer. Clark will continue as boardchairman. Frazier, who joined Merck in 1992, will serve his new position effective from 1 January, 2011.Lowes affirms its outlookIn a statement issued ahead of analyst and investor conference, Lowes again confirmed its previous forecast for sales and profitoutlook for its current fiscal 2010 fiscal year. The home improvement chain said it would announce new strategies to serve what itcalled more exacting consumers. Lowes also said it is still forecasting earnings per share of between $1.37 and $1.40 for the fiscal yearending January 28, 2011. It still expects sales at stores open at least a year to rise between 1 and 2 percent. It plans to open 42 newstores in all. Chief Executive Robert Niblock said the company has contended with an uncertain housing environment and a"declining industry."U.S. oil falls toward $85 as dollar risesOil fell towards $85 on Tuesday as the dollar hit a 10-week high on concerns about Europes debt crisis. U.S. crude for January CLc1slipped 50 cents to $85.23 a barrel by 1458 GMT after rising $1.97 on Monday, when it briefly touched $85.90, the highest price sinceNov. 12. ICE Brent LCOc1 lost 30 cents to $87.04 after rising more than 2 percent on Monday.
  • 4. The Intelligent Investor - U.S. ANALYSIS AND VIEWSUS consumer confidence hits five-month highConsumer confidence in the U.S. improved in November to reach the highest point in the last five months, suggesting the economy isstill expanding, albeit it slowly.The Conference Board said on Tuesday its consumer confidence index rose to 54.1 in November from 49.9 in October. The rise in theindex was better than analyst consensus of a reading of 52.“Consumer confidence is now at its highest level in five months, a welcome sign as we enter the holiday season. Consumers’assessment of the current state of the economy and job market, while only slightly better than last month, suggests the economy isstill expanding, albeit slowly," said Lynn Franco, Director of The Conference Board Consumer Research Center."Expectations, the main driver of this month’s increase in confidence, are now at the highest level since May (Exp. Index, 84.6).Hopefully, the improvement in consumers’ mood will continue in the months ahead,” he added.However, analysts played down the surge in the confidence indicator, suggesting that the further rebound in consumer confidencemay not translate into a sustained acceleration in consumption growth when the jobless rate runs high and housing worries continueto persist."Although it is encouraging that confidence is edging higher, consumers remain remarkably downbeat. If households were on thecusp of spending more significantly, confidence would now be well above the long-run average of 94," Capital Economics analystPaul Dales wrote in a note.Consumers’ assessment of current-day conditions was virtually unchanged from October, the survey revealed. Those claimingbusiness conditions are “bad” increased to 43.6 percent from 42.3 percent, while those claiming business conditions are “good”edged down to 8.1 percent from 8.3 percent.Consumers’ appraisal of the job market, however, was more positive than last month, according to the survey, which was based on arepresentative sample of 5,000 U.S. households.Those stating jobs are “plentiful” rose to 4.0 percent from 3.5 percent, while those stating jobs are “hard to get” edged up to 46.5percent from 46.3 percent. Consumers were more optimistic about the short-term outlook than in October, the survey said. Thoseanticipating an improvement in business conditions over the next six months rose to 16.7 percent from 15.8 percent, while thoseanticipating business conditions will worsen declined to 12.1 percent from 14.4 percent."Consumers were also more upbeat about future job prospects. Those expecting fewer jobs in the months ahead declined to 18.8percent from 22.3 percent, while the percentage expecting more jobs rose to 15.5 percent from 14.5 percent. The proportion ofconsumers expecting an increase in their incomes increased to 10.6 percent from 9.7 percent," Conference Board said in a statement. DAILY EARNINGS HITS & MISSES AS ON 30 NOVEMBER, 2010Company Name Qtr Curr EPS Est EPS Act Diff EPS Rev Est Rev Act Rev DiffAVANIR PHARMA Q4 USD -0.09 -0.1 -0.01 0.9 0.7 -0.2BARNES & NOBLE Q2 USD -0.08 -0.22 -0.15 1979.5 1905.6 -73.9CHINA BAK BATTERY Q4 USD 0.01 -0.14 -0.15 60.6 55.6 -5FUNTALK CHINA Q2 USD 0.17 0.18 0.01 249.3 260.4 11.1PATRIOT TRANSPORTATIO Q4 USD 0.65 0.6 -0.05 28.7 28 -0.7ROSETTA GENOMICS Q3 USD -0.23 -0.2 0.03 0.2 0.1 0SIMULATIONS PLUS Q4 USD 0.02 0.02 0 2.6 2.2 -0.4TRINA SOLAR Q3 USD 0.87 1.08 0.21 420.6 508.3 87.7
  • 5. The Intelligent Investor - U.S. ECONOMIC INDICATOR WATCH ON 01 DECEMBER 2010ADP National EmploymentForecast: 69,000 Prior: 43,000The ADP Employer Services will report data for jobs in private sector for the monthof November at 0815 EST. According to the last report, the U.S. private employers’added 43,000 jobs in October compared to a revised loss of 2,000 jobs in September.The September figure was originally reported as a loss of 39,000.ISMForecast: NA Prior: 56.9ISM Prices PaidForecast: NA Prior: 71.0Institute for Supply Management will release its data for national factory activityfor November at 1000 EST. The pace of growth in the U.S. manufacturing sectorquickened unexpectedly in October. The Institute for Supply Management said itsindex of national factory activity rose to 56.9 from 54.4 in September. A readingabove 50 indicates expansion in the sector. In October, the index of sectoremployment rose to 57.7 from 56.5 in September. The prices paid componentedged up to 71.0 from 70.5 while new orders jumped to 58.9 from 51.1.Domestic Car Sales (MoM)Forecast: 3.73mln Prior: 3.74mlnDomestic TruckForecast: 5.33mln Prior: 5.44mlnTotal Vehicle SalesForecast: 12.00mln Prior: 12.22mlnThe Commerce Department will release data for Vehicle Sales for November.EST/GMT Indicator Unit Forecast Prior0700/1200 Mortgage Ind -- -- 728.80700/1200 Refinancing Index -- -- 3793.60730/1230 Challenger Layoffs -- -- 37,9860815/1315 ADP Nat Employment k 69 430830/1330 Productivity pct 2.3 1.90830/1330 Unit Labor Costs pct -0.2 -0.11000/1500 Construct Spending pct -0.4 0.51000/1500 ISM -- 56.5 56.91000/1500 ISM Prices Paid -- 71 711400/1900 Fed Beige BookTime:TBA Dom Car Sls mln 3.73 3.74Time:TBA Dom Truck Sls mln 5.33 5.44Time:TBA Total Vehicle Sls mln 12 12.22
  • 6. The Intelligent Investor - U.S. THE NEXT TRADING DAYEconomic Events Federal Reserve Bank of Dallas President Richard Fisher speaks on Federal Reserve operations and economic update before a community forum hosted by the Federal Reserve Bank of Dallas - 1800 GMT Federal Reserve Vice Chair Janet Yellen speaks on "Fiscal Responsibility and Global Rebalancing" before the Committee for Economic Development 2010 International Counterparts Conference - 1410 GMTVice Chairman Janet Yellen will chair a subcommittee to review the FOMC’s “communication guidelines with the aim of ensuring that the public iswell informed about monetary policy issues while preserving the necessary confidentiality of policy discussions until their scheduled release,” theminutes said. Federal Reserve to release periodic Beige Book survey of U.S. economic conditions - 1900 GMTThe Beige Book, also called the Summary of Commentary on Current Economic Conditions, is a report published by the Federal Reserve Boardeight times a year. It contains anecdotal information on current economic conditions. It also contains interviews with key business contacts,economists, market experts, and other." Senate Banking hearing on Problems in Mortgage Servicing From Modification to Foreclosure. U.S. FDIC Chairman Sheila C. Bair, Federal Reserve Governor Daniel K. Tarullo, Acting Director of Federal Housing Finance Agency Edward DeMarco and Others to participate in a Panel - 1430 GMTCompany Events No earnings scheduled for release This report is produced by International Business Times For questions or comments reach us at researchanalysis@ibtimes.com For more information about our products visit www.ibtimes.com © IBTimes 2010. All rights reserved.