Israel launches anti-hijack system

Filed under: Products and services, Tech for the rest of us, Israel

Only with Israeli ingenuity can you take a technology that was once reserved only for video games and make it functional in the real world. The news that Israel has launched the anti-hijacking pilot ID system developed by Elbit Systems(NASDAQ:ESLT) is good not just for the company, but for air travel as well.

Starting next year, Israel will require pilots who fly to its airports to use the Security Code System (SCS), a local invention designed to ensure planes that have been commandeered for al Qaeda-style attacks are spotted in time. Israel plans a trial run for the system, using a credit card-sized keypad, next month, in cooperation with five airlines from the United States, Europe and Africa. About 10,000 of the units will ultimately be issued, with Israel bearing the cost. Pilots who fail the authentication test when they approach Israeli airspace will be denied entry. Should a plane go ahead, ignoring further warnings, Israel will consider it hostile and scramble fighter planes for an interception. In the worst case, that could mean an aircraft is shot down.

Several experts familiar with Israeli methodology say the system -- also known as "Code Positive" -- is based on the assumption that a hijacking will take place in one of two ways. Hijackers could either kill the pilots and take control -- as is believed to have been the case in the September 11 attacks on the United States. Or they could force pilots to issue a compliant response to the system in the hope of buying enough time to reach Israel and crash the planes into a target on the ground. In the first case, the hijackers would fail the security check as they entered Israeli airspace, giving military authorities about 15 minutes to launch a response. In the second, Dani Shenar, chief of security for Israel's Transportation Ministry said, pilots would be expected to relay a "May Day" alert.

Let's all hope that this system is never put to use, but in the event of a hijacking, this Israel system, could save hundreds of lives.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. Author holds a position in ESLT as of 11/21/07.

Hottest Products of 2007: Google Maps -- an entirely new direction

Filed under: Products and services, Consumer experience, Internet, Google (GOOG), Technology

This post is part of our Hottest Products of 2007 feature. Also check out our other Hottest Products of 2007 posts and let us know which product you think is the greatest thing since sliced bread.

Google Maps2007 may go down as the year people's perceptions of what a map is changed forever, and proved the value of user-generated content. Much of that sea change can be credited to Google Maps.

Maps -- for centuries static, analog pieces of information -- have gone digital, allowing us to add layer upon layer of additional information, in a variety that strains imagination. For example:

  • Maps that contain links to photographs of the noted location. If you want to know what the intersection of the Dawson and Dempster highways in Alaska looks like, you might find it on a Google Map. (Hint: There's a big sign warning hunters that it is illegal to leave gut piles within 1 km of the road).
  • Fans of the writer Patrick O'Brian (such as myself), can refer to a user-generated Google Map tracing the travels of his heroes Jack Aubrey and Stephen Maturin.
  • Followers of the television show The Amazing Race can track the participants' progress on a Google Map.
  • The Los Angeles Times created a Google map for readers to track the progress of the recent outburst of wildfires.

Continue reading Hottest Products of 2007: Google Maps -- an entirely new direction

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Is the U.S. in a 'growth recession'?

Filed under: International markets, Forecasts, Other issues, China, Russia, Middle East, Canada, Eastern Europe, Federal Reserve

There's an old Wall Street adage that goes, "Sometimes the Street's chorus is a chorus of two."

And there's perhaps no better example of that than the current debate over the strength of the U.S. economy. Professionals in the Concrete Canyon have been amassing on either side of two camps for months: "The U.S. economy is headed toward recession" or "The U.S. economy will continue to grow."

Still, as history demonstrates, and contrary to the current 'chorus' on Wall Street, sometimes there are more than two options. For example, what if the U.S. economy is headed toward a growth recession? I.E. a protracted period of sub-trend GDP growth.

Continue reading Is the U.S. in a 'growth recession'?

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Facebook vs. Google? Advantage: Google

Filed under: Google (GOOG), Microsoft (MSFT)

According to a recent piece in the Wall Street Journal [a paid publication], there is some frustration among loyal Facebook users. In the web site's search for monetization, there are some new features that do things like track user behavior off of Facebook.com. The hope is that this will help to create improved targeting for advertising messages.

But, it's also raising some privacy concerns.

So, might this be an opening for Google (Nasdaq: GOOG) to get a bigger piece of the social networking space?

Well, I had a chance to interview Robb Hecht, who is an expert on social networking and the operator of MEDIA 2.0. Hecht -- who doesn't consult for either company -- thinks that Google's new system - called OpenSocial - has lots of promise and could be an edge in the social networking war:


Continue reading Facebook vs. Google? Advantage: Google

A couple of turkeys set to fly

Filed under: Cisco Systems (CSCO), JetBlue Airways (JBLU), Israel

With the market experiencing a continued downturn and with Thanksgiving upon us, I thought we could highlight two stocks that have been turkeys so far this year (dogs maybe be more appropriate, but 'tis the season). However, unlike our favorite bird, these are poised to fly.

Radvision (NASDAQ:RVSN), which specializes in video conferencing over IP and 3G networks, has lost more than 40% YTD. It has produced successive earnings disappointments. While it has great technology, it has been struggling to execute its business plan. It's important to note however, that it has a very close relationship with Cisco Systems Inc. (NASDAQ:CSCO), and every few months rumors surface as to a potential M&A. I think that management has taken the Cisco relationship for granted and hasn't done enough to hustle new business.

That being said, as I mentioned the stock is down over 40% on the year. The company today received permission to purchase up to $30 million in stock. While some may see that as a PR stunt to boost the stock, more interesting was that Yehuda Zisapel, a former Chairman of the Board of RVSN and the brother of the company's current Chairman of the Board, bought $2 million of stock. With the stock getting creamed so far this year, I would look at it as a nice turnaround play going forward.



Continue reading A couple of turkeys set to fly

Countrywide says bankruptcy not a threat - do you buy it?

Filed under: Forecasts, Bad news, Rumors, Press releases, Rants and raves, Competitive strategy, Market matters, Countrywide Financial (CFC)

Countrywide Financial (NYSE: CFC) logo Although Countrywide Financial (NYSE: CFC) the bank, has gone on record as stating it is not in danger of going bankrupt and has plenty of liquidity to continue to operate and meet its current obligations, that could change. The bank is no doubt referring to the immediate future, like today or this week. Those who have expressed concern are thinking about next week, next month or six months out. I have no idea what the truth is, or if there are multiple truths, or if the company is dancing on the head of a pin.

  • "Countrywide Home Loans is expected to service debt maturities beyond 2008 without additional debt issuance," the company said. Earlier Tuesday, a Countrywide representative told The Wall Street Journal that speculation the company may file for bankruptcy is 'absolutely false.'"

The company stock started off the year around $45 per share -- shares now trade around $9 per share. Here is a point that may be lost on the average investor: Even if there was no problem whatsoever with subprime mortgages and even if not one single mortgage holder was foreclosed on, Countrywide's business is down perhaps 80% and it is losing money -- profits are not to be found.

If people are not buying homes and condos and are not seeking traditional loans or any other kind, then Countrywide has to move fast to shrink its enterprise to match the customer demand level (which it has indeed been doing), and then start growing when the market picks up again. That means it has to be lean and mean, which means in turn that the company has to have the wherewithal to survive in a tough market for several years, not just this month.

Continue reading Countrywide says bankruptcy not a threat - do you buy it?

Paulson: home-loan defaults could rise in 2008

Filed under: Bad news, Citigroup Inc. (C), Bank of America (BAC), Federal Natl Mtge (FNM), Wachovia Corp (WB), Housing, Federal Reserve

U.S. Treasury Secretary Henry Paulson is on the wires again, this time predicting that the number of potential home-loan defaults "will be significantly bigger" in 2008 than in 2007.

In an interview with The Wall Street Journal (subscription required), Paulson said, "The nature of the problem will be significantly bigger next year because 2006 (mortgages) had lower underwriting standards, no amortization, and no down payments. He added that "We'll watch carefully mortgages that will be reset."

Home prices fall

Paulson's comments came before the National Association of Realtors announced that home prices had fallen in 51 of 150 U.S. metropolitan areas in Q3, with the median sales price falling to $220,800 in Q3 2007, compared to $225,300 in Q3 2006. The NAR also announced that home sales fell to an annualized rate of 5.42 million units, including single-family homes and condominiums, compared to a 6.29-million-unit annualized rate a year ago.

Continue reading Paulson: home-loan defaults could rise in 2008

Apple iPhone secretly invading your privacy?

Filed under: Products and services, Consumer experience, Apple Inc (AAPL), iPhone, Smartphones, Technology

The game of tag between Apple, Inc. (NASDAQ: AAPL) and those ingenious hackers who want to turn the iPhone into the modern-day Swiss Army knife has reached a new levels of sorts. Some of those wondrous hackers are now saying that the iPhone sends information back to Apple about each iPhone owner's habits regarding phone use, web surfing and digital media choices.

Although some of the things Apple hackers say can be construed as a little over the edge, this one may be entirely plausible. The main mantra out of this newer revelation is this: why isn't Apple disclosing such facts to each and every iPhone user? How it collects data, when it collects it, and where does it go?

If each iPhone is collecting a decent amount of data about many of the popular facets of usage for each customer and sending that information back to Apple, a few lines in a terms of service agreement aren't going to cut it. Apple's apparent privacy breaches here could give the iPhone a bad rap in some circles, although I doubt it's enough to dent sales in any measurable way.

Funny bidness -- US Airways passengers can't drink over NM

Filed under: Products and services, Launches, Krispy Kreme Doughnuts (KKD), US Airways Group (LCC), Japan

http://farm1.static.flickr.com/222/468885174_a239498b9f_m.jpgJust when I thought flying couldn't become more unpleasant comes word that US Airways (NYSE:LCC) passengers will have to fly over New Mexico dry. Apparently, the airline is in a tiff with the state's alcohol regulators, who have refused to give them a permit to serve booze while in or over the state. Apparently, the state extends into orbit.

Stuck for what to bring to that Thanksgiving potluck? I'm thinking a cheesecake would be nice, but...I wish there was a way to make it a little more fattening. Thankfully, Lisa Robertson of North Carolina showed me the way with her award-winning Krispy Kremey White-Chocolate Raspberry-Filled Cheesecake, which uses Krispy Kreme (NYSE:KKD) donuts for its crust.



Continue reading Funny bidness -- US Airways passengers can't drink over NM

Google oogles the magazine biz

Filed under: Rumors, Magazines, Competitive strategy, Google (GOOG)

Google (NASDAQ: GOOG) is well on its way to owning Earth via the proceeds of delivering ads to internet users based on their individual interests. Now, apparently, the company has taken a look back to the world of print content and asked, why not there, too?

At least, that's what I glean from a patent application recently filed by the company for "Customization of content and advertisements in publications." The application suggests that the technology exists that would allow a magazine, Time Magazine for example, to tailor each copy of each issue for each individual reader.

For example, I'm interested in foreign affairs, books and movies, but not at all in celebrities. My copy of Time, then, would contain reports from around the world, book and movie reviews and advertisements consistent with my tastes. Another reader's copy might have comprehensive coverage of Anna Nicole Smith and ads for Curves.

Google would fit nicely into this stream with its proven technology to recognize readers' tastes and serve up the appropriate content. While some bloggers have speculated that Google is interested in starting a magazine, I highly doubt that. The money isn't in the paper, it's in the data. Following this model, Google could end up with both Time and Money---as clients.
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Some CEOs (WB) actually believe in their own company

Filed under: Citigroup Inc. (C), Merrill Lynch (MER), Wachovia Corp (WB)

With all the bad PR surrounding the departure of Citigroup's (NYSE: C) CEO Chuck Prince, along with Merrill Lynch's (NYSE: MER) CEO Stanley O'Neill, not to mention their huge severance packages, it's refreshing to see a company where the CEO actually puts his money where his mouth is and invests in the stock of the company he runs.


News that Wachovia (NYSE: WB) CEO Ken Thompson bought 100,000 shares this past Friday, to go along with the 37,000 he bought earlier last week, is a telling sign that not only does he pay lip service to his company's stock being undervalued, but has actually invested millions of his own dollars to back it up.

With the debate over executive compensation heating up, and investor cynicism towards CEOs at an all time high, this move buy Thompson is commendable. How many stories have we read about CEOs making large salaries, getting enormous bonuses and the stock price continues to drop?

Kudos to Thompson, and may his large investment pay off.

Aaron Katsman is the lead Portfolio Manager and Managing Director of America Israel Investment Associates, LLC. and Senior Editor of IsraelNewsletter.com. Disclosure: Writer holds no position in any stock mentioned as of 11/21/07.

Study warns internet capacity may soon be reached

Filed under: Consumer experience, Internet, Technical Analysis, Technology

In a study that has dire implications for internet-dependent businesses (hey, that's me!), Nemertes Research has concluded that traffic on the internet will soon begin to experience slowdown analogous to that of our nation's freeways at rush hour.

The comprehensive study, including projections based on historical use patterns and interviews with market specialists about projected usage, concluded that the choking point will come in the internet access infrastructure within the next few years, especially in North America. Once through that bottleneck, however, the study found that trunk capacity and switching technology will stand up to the growth in traffic.

Nemertes concludes that $42-$55 billion of investment would be needed to build out enough to handle the increased traffic, 50-70% more than is currently planned.

Continue reading Study warns internet capacity may soon be reached

Oil flat after hitting record $99.29 a barrel

Filed under: Exxon Mobil (XOM), Chevron Corp (CVX), ConocoPhillips (COP), BP p.l.c. ADS (BP), Commodities, Oil, Headline news

Crude oil was virtually unchanged at $98.02 Wednesday at midday, as traders took a wait-and-see approach following a 1.07-million-barrel drop in weekly crude inventories for the week ending November 16 .

Analysts had expected an 800,000-barrel inventory gain, hence Wednesday's draw down struck some traders as an anomaly, perhaps attributable to thinner trading conditions ahead of the [U.S.] Thanksgiving Day holiday.

Earlier, crude oil had reached a record $99.29 per barrel in electronic trading.

Heating oil gained about 2 cents to $2.70 and unleaded gasoline rose about 1 cent to $2.45. Natural gas dropped 0.007 to $7.470 per million BTUs.

Oil Analysis: Fundamental and technical indicators continue to favor an oil price move toward and beyond $100 per barrel, although Wednesday's thin trading conditions will make it harder to clear the $100 hurdle today, than in a normal trading volume session. Further, traders underscored that no factors have appeared that suggest the oil-higher trend is set to end.

Wal-Mart heavily publicizes website shopping for Black Friday

Filed under: Products and services, Wal-Mart (WMT), Black Friday

Wal-Mart Stores Inc. (NYSE: WMT) said this week that it would heavily publicize its website for this Friday's Black Friday sales event and would kick off the 'official' start to holiday sales on Thanksgiving Day. It will launch several web-only sales tomorrow and will accept orders as well on turkey day. Then, come Friday morning, stores will unleash into pandemonium most likely, along with other retailers nationwide.

Some of the deals that will be visible on www.walmart.com tomorrow have already been officially announced by the retailer. Examples: the Microsoft Zune 30 gigabyte MP3 video player for $98.87, and the Garmin Nuvi 650 Portable global positioning system for $298.87. In the case of the Zune, it's last year's model that is already selling for under $100 at many web retailers, so that's not a surprise.

In addition to "visible" sales that will launch on the Wal-Mart website tomorrow, the retailer will have a special "secret" deals area on its website to allude to deals that will be available in stores first thing Friday morning. That is, Black Friday morning.

Those "secret" deals won't be advertised in its circulars, which are the most common ways customers find Black Friday sales information. I said last week that Wal-Mart needs to become a little more creative in its Black Friday marketing efforts. This isn't a huge start, but it's a start.

Hewitt Associates (HEW): Shares forming a bullish 'flag'

Filed under: Earnings reports, Target Corp. (TGT), Alcoa Inc (AA), Wachovia Corp (WB), Technical Analysis, Stocks to Buy

Seeing to a company's diverse human resource service needs can be a complex operation and sometimes a little help is needed. One of the world's leading providers of such assistance is headquartered in Lincolnshire, Illinois.

Hewitt Associates (NYSE: HEW) offers human resources services. The company administers health care, payroll and retirement programs on behalf of hundreds of firms, for millions of employees and retirees worldwide. It also advises more than 2,300 companies on the design, implementation and operation of their own human resources programs. Hewitt employs some 23,000 associates, in 33 countries. Clients include Alcoa (NYSE: AA), Target (NYSE: TGT) and Wachovia (NYSE: WB).

Continue reading Hewitt Associates (HEW): Shares forming a bullish 'flag'

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What's next, Google TV?

Filed under: Television, Google (GOOG), Technology

Technology insider blog, TechCrunch, ran a thought-provoking post yesterday about Google (NASDAQ: GOOG) entitled, The Google Set-Top Box. The article speculates that the search-engine giant may leverage its new open-source operating system, Android, to address TV advertising in a revolutionary way. Google is already testing a new ad platform for TV with Echostar (NASDAQ: DISH), being propped up with data provided by a recent deal with Nielsen. But this just addresses the way ads are bought and sold. According to TechCrunch, almighty Google's ambitions for television go way beyond just ad delivery.

In short, the article posits that Google's aspirations for the mobile phone can be applied to the set-top box, itself essentially a computer. Android's open-source application platform can be used to help promote and support new developments that would turn TV watching more like Internet browsing. "In many ways," says Google's head of TV development, Vincent Dureau, "we think that television is becoming like the Internet in that there is a multiplication of channels. This creates challenges for viewers, advertisers and creators."

So, what does this mean in practice?

Continue reading What's next, Google TV?

Advanced Micro Devices (AMD) seen lagging behind Intel (INTC)

Filed under: Major movement, Analyst reports, Bad news, Industry, Competitive strategy, Intel (INTC), Advanced Micro Dev (AMD), Options, Technical Analysis

AMD logoAdvanced Micro Devices Inc. (NYSE: AMD) stock is falling this morning after an analyst yesterday expressed concern that microchip producers are falling behind industry leader Intel (NASDAQ: INTC) in product offerings. The Cowen and Co. analyst said that AMD continues to lag behind Intel's new graphics processor offerings while the market is increasingly demanding graphics-intensive applications. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on AMD.

After hitting a one-year high of $23.00 in December, the stock has fallen much of the last year and hit a one-year low today. This morning, AMD opened at $11.15. So far today the stock has hit a low of $10.52 and a high of $11.50. As of 11:45, AMD is trading at $10.65, down $0.63 (-5.6%). The chart for AMD looks bearish and steady, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.

Continue reading Advanced Micro Devices (AMD) seen lagging behind Intel (INTC)

Flash: Oil tops $99

Filed under: Oil

Crude oil for January delivery touched a record $99.29 a barrel in electronic trading before easing to $98.94 a barrel, rising 91 cents from the close of trading on the New York Mercantile Exchange Tuesday, according to MarketWatch.

Douglas A. McIntyre is an editor at 247wallst.com.

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Flash: Sharp decline in Asian markets, Hong Kong off 4.2%

Filed under: China, China Life Insurance ADS (LFC)

Asian markets sold off over night, lead by Hong Kong's Hang Seng, which fell 4.2%. China Petroleum (NYSE: SNP) dropped 6.2%. China Life (NYSE: LFC) fell 5.8%

The Nikkei fell 2.5%. Honda (NYSE: HMC) was off 5.7%.

The Shanghai Composite fell 1.5%

Douglas A. McIntyre is an editor at 247wallst.com

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Whole Foods raises dividend to offset earnings weakness

Filed under: Earnings reports, Whole Foods Market (WFMI)

A classic case of misdirection: Whole Foods (NASDAQ: WFMI) reported weak earnings, but raised its dividend, sending its shares up as much as 7% after hours.

Whole Foods earned $33.9 million, or 24 cents per share, in its fourth quarter, down from $39.8 million, or 28 cents per share, a year earlier. The company blamed costs of merging with Wild Oats for much of the drop. Revenue rose 35% to $1.74 billion, in large part because of the merger.

But same-store sales were up an impressive 8.2%.

All in all, the market might have been dissatisfied with the numbers and pushed down the stock, especially in an environment where weak numbers can be especially punishing to a stock's price. But Whole Foods was clever and got around that. According to TheStreet.com, WFMI "increased its dividend 11% to 20 cents per share," making the stock more attractive to investors who may have concerns about earnings.

Douglas A. McIntyre is an editor at 247wallst.com.

Smart phones getting smarter

Filed under: Google (GOOG), Apple Inc (AAPL), Motorola (MOT), Nokia Corp. (NOK), Smartphones, Technology

The NPD Group released its quarterly run-down on the mobile phone industry. The research organization, known for its comprehensive consumer and retail information, looks at quarterly sales numbers and compares the findings to its own historical numbers.

There is definitely some salient info for investors looking at or in the mobile phone market:
  • Smart phone are on fire: "the percentage of smartphones sold during the third quarter increased from 4% of all phone sales in the third quarter of 2006 to 11% during the same timeframe in 2007 - an increase of 163% year over year."
  • Convergence of musical devices with phones: "Fifty percent of new phones were able to play music in the third quarter of 2007 (double the prior year) and 11 percent were smartphones."
"The mobile phone market is not only growing, it is growing smarter," said Ross Rubin, director of industry analysis for NPD. "The nearly threefold increase in smartphones shows that this once negligible niche is becoming a more influential force in the consumer market -- attracting entrants such as Apple, Inc. (Nasdaq: AAPL) and the Open Handset Alliance."

While Motorola, Inc. (NYSE: MOT) commanded the largest marketshare of the top 5 manufacturers at 31%, growth in the industry (47% year over year) is jacking up the competition. Apple has made a splash with the iPhone and its going to be interesting to see what route Google, Inc. (Nasdaq: GOOG) is going to take with its rumored gPhone. Read Sheldon Liber's good analysis of what Google may be planning to do with a mobile platform.

As the iPhone gets more traction, it will be interesting to see what NPD's analysis will look like in a year from now.

Zack Miller is the Managing Editor of IsraelNewsletter.com and a former equity analyst for a leading multinational hedge fund. Disclosure: He holds a position in GOOG but none in the other stocks mentioned.

Before the bell: Sharply lower open expected as oil rises and global markets sell off

Filed under: Before the bell, International markets, Earnings reports, Bad news, Market matters, Gap Inc (GPS), Economic data, Deere and Co (DE), Housing, Federal Reserve

U.S. stock futures tumbled this morning, indicating a significantly lower start the day before Thanksgiving holiday. The dollar continued its decline, and with it, in reverse manner, oil continued its climb, reaching yet new highs. Overseas markets sold off sharply as a result, and 10-year U.S. Treasuries fell below 4% for the first time in two years. Investors await some indicators due out today.

Yesterday, U.S. stocks finished a volatile session higher with the Dow Jones Industrial Average closing up 51 points, or 0.4%, despite declining over 100 points earlier in the session. Significant losses at lender Freddie Mac weighed on the market, balancing upbeat earnings from Hewlett-Packard. The Nasdaq Composite added 3 points, or 0.13%, and the S&P 500 rose 6 points, or 0.45%.

Today, at 8:30 a.m., weekly initial jobless claims is dues since markets are closed tomorrow.
At 10:00 a.m. EST, October leading indicators and the University of Michigan's final November consumer sentiment index are due. These could impact the market.
At 10:30 a.m., weekly crude inventories will be released. Oil prices rose to a record above $99 a barrel, reaching $99.29, ahead of the inventory report as concerns mount of inadequate supplies for the Northern Hemisphere winter. News of refinery problems helped push prices upward as did the ever declining U.S. dollar and speculation that the Federal Reserve will again cut interest rates. Will today be the day we see oil prices reach $100 a barrel? Probably not as oil retreated somewhat to above $98, but any further news that can affect the dollar, or inventories coming in less than expected, may very well push oil back up again.

Continue reading Before the bell: Sharply lower open expected as oil rises and global markets sell off

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Big pre-market movers

Ikon Office (NYSE: IKN) moving up 22% on $500 million share buy-back.

China Financial Online (NASDAQ: JRJC) off by 19% on poor earnings.

Freddie Mac (NYSE: FRE) down almost 7% on continuing concerns about the company's balance sheet and mortgage exposure.

China Petroleum (NYSE: SNP) off 7% on a drop in Asia market overnight.

Stocks may not open at the same prices at which they trade in the pre-market.

Douglas A. McIntyre is an editor at 247wallst.com.

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Before the bell: AAPL, WFMI, GOOG, GM, PFE ...

Filed under: Before the bell, Google (GOOG), Apple Inc (AAPL), Dell (DELL), Hewlett-Packard (HPQ), Pfizer (PFE), General Motors (GM), XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Whole Foods Market (WFMI)

Before the bell: Sharply lower open expected as oil rises and global markets sell off

After France comes Germany with a similar ruling: Apple Inc.'s (NASDAQ: AAPL) iPhone must be offered without contract restrictions. Deutsche Telekom AG's (NYSE: DT) mobile unit said it would comply to the court ruling that was issued after Vodafone challenged T-Mobile's exclusive lock on the handset.

Following Hewlett Packard's (NYSE: HPQ) better-than-expected results, what can be expected from Dell, Inc. (NASDAQ: DELL). Dell, which is reporting next week, is more vulnerable to U.S. economic woes as it earns 56% of its revenue from sales in the U.S. whereas HP is focused more on international markets and only earns a third of its revenue from the US. Considering Dell is also in the midst of a turnaround, it is clear the company may be facing more challenges.

According to TechCrunch, Google, Inc. (NASDAQ: GOOG) is rumored to be trying "to do to the set-top box what it is trying to do to the mobile phone with its Android operating system-create an open-source hardware platform and attract developers to build applications on top of it."

Continue reading Before the bell: AAPL, WFMI, GOOG, GM, PFE ...

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Has Ford found a buyer for Jaguar and Rover?

Filed under: Deals, Ford Motor (F), India, Private equity

It appears that Ford (NYSE: F) may finally have a buyer for Jaguar and Rover. The Wall Street Journal reports that Indian conglomerate Mahindra & Mahindra will tie up with private equity operation Apollo Management to buy the car units. Not all of the roadblocks to the deal have been pushed aside. The Journal writes "Labor leaders in the United Kingdom are seeking assurances that the brands' new owner would protect jobs and factories in the country."

Ford paid a little over $5 billion for the two units, and industry estimates put their current value at $1.5 billion. So the sale would mark another step in the humiliating downsizing of Ford.

The probability of a sale also raises an interesting question. If Ford's management is so much better than it was a year ago and it has a much better labor deal with the UAW, why sell the units at all? If a company in India can improve the fortunes of the two brands, why can't Ford?

It is not too late for the No.2 U.S. car company to work on fixing the units itself. The poor results of Jag and Rover are already in the stock. Improving their results ought to help shareholder value.

Douglas A. McIntyre is an editor at 247wallst.com.

Best & worst in electronics, how to get a better mortgage rate & office party tips - Today in Money 11/21

Filed under: Money and Finance Today, Federal Natl Mtge (FNM), Countrywide Financial (CFC), Abercrombie and Fitch (ANF), UAL Corp (UAUA), Burger King Hldgs (BKC), Deere and Co (DE)

In the News:

Go-Go or No-Go Christmas?
For consumers and the retailers who serve them, this may be a Christmas of those who "have" and those who "have less." In a tightening economy, some consumers are hurt more than others. Rising costs for gasoline and food affect people with lower incomes more. Analysts expect consumers who have more money to spend as much as last year, maybe more. Consumers who have less money will spend less than last year, maybe the same.
Go-go or no-go Christmas? - USATODAY.com


Best & Worst in Electronics for 2007

Winners were clear in the music player and game console categories, but the dust has yet to settle in the fight over PC-to-TV and next-gen DVD technology.
Best and Worst Consumer Electronics, 2007


6 Ways to Get a Better Mortgage Rate

Here are six strategies to qualify for a lower interest rate by boosting your credit score and reducing your debt.
Six Ways to Get a Better Mortgage Rate - TheStreet.com


Oh, Behave!

At the annual office bash: what to drink, who to talk to, when to leave-and how to manage a crisis should all the rest go awry.
Office Party Etiquette Guide - Portfolio.com What to Wear to the Office Party
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Cramer on BloggingStocks: Why foreigners find U.S. buys so unattractive

Filed under: Black and Decker (BDK), Wachovia Corp (WB), Cramer on BloggingStocks

Jim Cramer on BloggingStocks TheStreet.com's Jim Cramer says the poor outlook for this economy has stemmed the flood of takeovers from abroad we'd normally see in this kind of market.

Where are the Europeans? Where are the Asians? Where are the Middle Easterners? Are they all cowed into not buying our companies despite the decline in the dollar?

Consider that there have been only two deals above $10 billion this year: AstraZeneca (NYSE: AZN) (Cramer's Take), which bought Medimmune for $15 billion, and Saudi Basic Industries, which purchased GE Plastics for $12 billion. No one has taken advantage of the astounding decline in the U.S. dollar to buy up enterprises.

Take two that seem absurdly low: Whirlpool (NYSE: WHR) (Cramer's Take) and Black & Decker (NYSE: BDK) (Cramer's Take). Both companies have bought in an immense amount of stock. Both companies now trade at $5 billion in value. Give them a 25% haircut and you can see how much these name-brand companies are marked down.

But nobody cares.

Continue reading Cramer on BloggingStocks: Why foreigners find U.S. buys so unattractive

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$100 oil ... Will today be the day?

Filed under: Major movement, International markets, Forecasts, Oil

For about the past month now it has looked as though $100 oil was on the horizon, but could today finally be the day that we do indeed see prices crossing through the psychological $100 barrier? Don't be too surprised if it is, with prices already trading above $99 ahead of today's inventory report.

Later this morning we are going to get a very important piece of information from the US Energy Department when it reports last week's inventory numbers. Analysts are expected to see a rise in inventories of 800,000 barrels, but the market has been acting as if it believes we will not see this much of an increase. With prices flirting so close to the $100 mark you can be sure that if inventories do come in below expectations we will be reading about $100 oil before the end of the day.

We will also be watching for gasoline supplies. On average, analysts are expecting to see a 700,000 lift in gasoline inventories in this week's report. While gasoline did fall a bit last night, we are still looking at a national average of $3.09 for a gallon of regular unleaded. This is an amazing increase from the average this time last year when prices at the pump were $2.24, but down from the high of $3.23 we saw back on May 24.

Today's inventory report should be out 10:30 AM EST, and we will post the results as they become available.

Michael Fowlkes has worked as a stock trader for seven years and spent the last two years working as an analyst for the online investment advisory service Investor's Observer.
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Newspaper wrap-up: Countrywide, Home Depot cut back on buybacks

Filed under: Newspapers, Magazines, Apple Inc (AAPL), Home Depot (HD), Citigroup Inc. (C), JPMorgan Chase (JPM), Bank of America (BAC), Bank of New York (BK), Countrywide Financial (CFC), UAL Corp (UAUA), iPhone

MAJOR PAPERS:
OTHER PAPERS:
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Analyst downgrades: ERIC, CC and HOTT

Filed under: Analyst upgrades and downgrades

MOST NOTEWORTHY: Ericsson, Circuit City and Hot Topic were today's noteworthy downgrades:
  • Societe Generale downgraded shares of Ericsson (NASDAQ: ERIC) to Hold from Buy after the company lowered its Q4 guidance. Goldman Sachs downgraded shares to Neutral from Buy on the company's lowered Q4 revenue outlook and the growing probability that the wireless infrastructure market will decline again in 2008.
  • Circuit City (NYSE: CC)'s rating was lowered to Neutral from Overweight at JP Morgan, as they believe the company's high cost turnaround will require a strategic partner or acquirer, which may not happen until after 2H08 and this year's holiday season.
  • Citigroup downgraded shares of Hot Topic (NASDAQ: HOTT) to Hold from Buy to reflect their pushed out expectations for an earnings recovery.
OTHER DOWNGRADES:
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Option update: XM Satellite and Sirius Satellite volatility up into FCC decision

Filed under: XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Options

XM Satellite Radio (NASDAQ: XMSR) closed at $14.06.

XMSR and SIRI announced on 2/20/07 a merger of equals. XMSR shareholders will receive 4.6 SIRI shares for each XMSR share. The Federal Communication Commission (FCC) is expected to decide on the merger before year end. XMSR December option implied volatility of 122 is above its 26-week average of 61 according to Track Data, suggesting larger price risks.

Sirius Satellite Radio (NASDAQ: SIRI) closed at $3.48.

SIRI December option implied volatility of 88 is above its 26-week average of 59 according to Track Data, suggesting larger price risks.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

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Analyst upgrades: DKS, ERIC and DT

Filed under: Analyst upgrades and downgrades, Aon Corp (AOC), Office Depot (ODP)

MOST NOTEWORTHY: Dick's Sporting, Ericsson and Deutsche Telekom were today's noteworthy upgrades:
  • Citigroup upgraded shares of Dick's Sporting (NYSE: DKS) to Buy from Hold based on valuation, margin expansion and increased visibility.
  • Ericsson (NASDAQ: ERIC) was raised to Buy from Hold at WestLB on valuation following yesterday's sell-off. The firm feels investors need to look beyond 2008.
  • Lehman upgraded shares of Deutsche Telekom (NYSE: DT) to Equal Weight from Underweight as they believe earnings momentum will be seen in the near-term.
OTHER UPGRADES:
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Option update: XOM and COP elevated as oil breaks $99

Filed under: Exxon Mobil (XOM), ConocoPhillips (COP), Options

ExxonMobil (NYSE: XOM) closed at $87.82 Tuesday.

Crude oil futures are up 0.63% to $98.65 according to Bloomberg. XOM overall option implied volatility of 31 is above its 26-week average of 25 according to Track Data, suggesting larger price fluctuations.

ConocoPhillips (NYSE: COP) closed at $79.29 Tuesday.

COP overall option implied volatility of 34 is above its 26-week average of 29 according to Track Data, suggesting larger risks.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

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Analyst initiations: AVAV, AOB and INTC

Filed under: Intel (INTC), Analyst initiations

MOST NOTEWORTHY: AeroVironment, American Oriental and Intel were today's noteworthy initiations:
  • Suntrust initiated AeroVironment (NASDAQ: AVAV) with a Buy rating and $32 target and expects AVAV's market leadership in unmanned aerial systems and increased effort in the high altitude to drive strong organic growth.
  • Jefferies believes American Oriental (NYSE: AOB) is capable of making sizable acquisitions given its strong cash position and finds the valuation attractive at current levels. The firm started shares with a Buy rating and $20 target.
  • Intel (NASDAQ: INTC) was initiated with a Neutral rating and $30 target at Baird on valuation.
OTHER INITIATIONS:
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A new look at the XM-Sirius merger

Filed under: Forecasts, Deals, Industry, XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI)

With nothing better to do the day before Thanksgiving, The Wall Street Journal has decided to revisit the odds of whether a merger between the two satellite radio companies, XM Satellite (NASDAQ: XMSR) and Sirius (NASDAQ: SIRI) have improved. The paper writes "in the past few months, investors have shown increasing confidence of the deal's winning approval from the Federal Communications Commission and the Justice Department."

There may be a few good reasons that the chances of a deal have improved, but they are hardly compelling.

Some of the car companies have come out in favor of the merger. That would only make sense. Marketing two platforms is probably a bit of a mess. A fair number of congressmen who want to look good say the merger is bad for consumers, and will drive up prices. There isn't any hard evidence of that, but it is a nice talking point.

There is probably an economic reason for a merger. Both companies have over a billion dollars in debt. Paying that down would probably be easier with the savings from combining the companies.

But Wall Street may look at the share prices of XM and Sirius and say that they are the best sign that a merger looks good. The stocks are both up 25% in the last three months. Maybe investors are gambling the deal is looking better.

There is another reason for the stocks to be up: Both companies are still growing and adding subscribers. The firms may still be losing money, but they are moving closer to break-even.

That has nothing to do with a merger.

Douglas A. McIntyre is an editor at 247wallst.com.

Wall Street turkeys get pardon as Fed lets consumers pay for rampant inflation

Filed under: Market matters, Citigroup Inc. (C), Bank of New York (BK), Economic data, Federal Reserve

TurkeyWith the price of Thanksgiving dinner up 11% this year over last, the Fed won't help consumers because it's confident that inflation -- as measured by Personal Consumption Expenditures (PCE) will range between 1% and 2%. Meanwhile, Washington is happy to create lucrative business deals for Wall Street -- in the form of arrangements to manage and keep records of its Structured Investment Vehicle (SIV) bailout.

What is the Fed smoking? I don't know any personal consumption expenditures that are growing at 1% to 2%. The price of oil has quadrupled since January 2001 to $99.29 a barrel, gasoline prices are up 40% since last year, airfares have more than doubled -- a flight from Boston to Florida that cost $300 last year is now $700 -- and the dollar has lost 61% of its value since January 2001. I guess the Fed has decided to define PCE in a way that conveniently confirms its pro-inflation interest rate policy.

Meanwhile, the Treasury Department has backed a Super-SIV plan to bail out banks, such as Citigroup Inc. (NYSE: C) which created the $320 billion SIVs industry and invested the proceeds of SIV-issued commercial paper in now-worthless mortgage backed securities (MBSs).

Continue reading Wall Street turkeys get pardon as Fed lets consumers pay for rampant inflation

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Apple's iPhone running into European roadblocks

Filed under: Bad news, Competitive strategy, Apple Inc (AAPL), iPhone, Smartphones, Technology

With Apple, Inc. (NASDAQ: AAPL)'s iPhone setting the stage to become a phenomenon in Europe like it has in the U.S., some minor glitches are starting to unravel in the company's plans there. This week, a German court wanted T-Mobile (part of Deutsche Telekom AG) to change the way it markets the iPhone. Unlike in the U.S. -- where Apple and AT&T have a five-year exclusive partnership -- things aren't that easy in the world of European "open market" wireless.

In other words, the German court doesn't want T-Mobile to sell the iPhone only in conjunction with a two-year service contract (the same deal AT&T gives U.S. iPhone customers). The court, in addition to that rather-large order, also asked that the T-Mobile version of the iPhone be opened up so it can work with other wireless providers. Ouch!

European wireless giant Vodafone is most likely to blame here, as it had a gripe with T-Mobile's marketing plans.
T-Mobile says that it reserves the right to claim damages from any moves Vodafone makes that would impede iPhone sales, but this is just the beginning. Apple's tight grip on revenue sharing from each mobile partner it signs a contract with may not fly in some parts of the world -- something Apple should know by now. But that's the power the iPhone has -- wireless carriers will do anything to offer it to customers.

Jobless claims dip to 330K, in line with consensus

Filed under: Economic data, Federal Reserve

First-time claims for unemployment benefits fell 11,000 last week to 330,000 -- in line with the consensus estimate, the U.S. Labor Department announced Wednesday.

Meanwhile, the more-telling four-week moving average fell 750 to 329,750, the Labor Department reported. One year ago, new claims for unemployment insurance totaled 322,000.

An average of 2.57 million Americans are receiving state jobless benefits, also called continuing claims; a year ago about 2.43 million Americans were receiving benefits.

The U.S. jobless rate is at 4.7%, and many economists expect it to climb slightly on soft Q4 GDP growth. The U.S. economy recorded Q3 GDP growth of 3.9%, with many economists projecting a Q4 GDP growth rate in the 1.5-2.2% range.

Continue reading Jobless claims dip to 330K, in line with consensus

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Option update: Abercrombie & Fitch, Deere beat estimates

Filed under: Abercrombie and Fitch (ANF), Options, Deere and Co (DE)

Abercrombie & Fitch Co. (NYSE: ANF) reported Q3 total net sales increase of 13% to $973 million. ANF reported Q3 EPS of $1.29 verses consensus estimate of $1.28. ANF announced net income increased 15% to $117.6 million. ANF December option implied volatility of 48 is above its 26-week average of 36 according to Track Data, suggesting larger risk.

Deere & Co. (NYSE: DE) volatility is elevated, with Q4 net sales and revenues up 20%. DE had Q4 EPS of $1.88, above consensus estimates of $1.55. Deere overall option implied volatility of 42 is above its 26-week average of 33 according to Track Data, suggesting larger price risks.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

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Nordstrom: Ho ho ho for the holidays

Filed under: Earnings reports, Good news, Nordstrom, Inc (JWN)

Hing-end retailer Nordstrom Inc. (NYSE: JWN) is heading into the holiday shopping season in fine shape. There doesn't seem to be any slow-down in consumer spending for designer and luxury items. 3Q 2007 total sales increased 5.3% to just under $2 billion, and net earnings increased $30 million to $165.7 million or $0.68 diluted EPS. The all important same store sales figure increased 2.2%, less than its competitors, but still an increase. On the flip side, gross profit decreased due primarily to large markdowns caused by deficiencies in inventory management. Administrative expenses and cost of sales decreased as the company tried to control costs.

Nordstrom has plenty of competition in high-end retailing, and is concentrating on growing market share with the opening of 4 new stores in 3Q alone. Nordstrom sold off its remaining interest in Façonnable in 3Q, and netted about $21 million from the deal. The company has earmarked $3 billion in capital expenditures for 2008-2012, primarily for new stores and existing store remodels. Nordstrom has also authorized up to $2.5 billion for stock repurchase, as management feels very confident in the company's ability to generate positive cash flow. The company spent $750 million during 3Q 2007 to repurchase 16.4 million shares. Nordstrom will also pay out a dividend of $0.135 in December. Presently, the company is sticking with its previous FY guidance of $2.87-$2.91 diluted EPS.

The stock closed yesterday at $34.21, up $3.69 or 12% on the earnings news, though it is down slightly in trading this morning.

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Option update: Washington Mutual volatility aggressive as shares near seven-year low

Filed under: Wachovia Corp (WB), Washington Mutual (WM), Options

Washington Mutual (NYSE: WM), the third largest mortgage lender in the U.S. with consumer and business banking, closed at $17.99 Tuesday. WM December option implied volatility of 90 is above its 26-week average of 41 according to Track Data, suggesting larger risk.

Wachovia (NYSE: WB), a diversified financial services company, closed at $38.43. WB December option implied volatility of 48 is above its 26-week average of 31 according to Track Data, suggesting larger price risks.

Daily options Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

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Google's share price target raised to $900

Filed under: Analyst upgrades and downgrades, Google (GOOG)

Google Inc.'s (NASDAQ: GOOG) share price has been on a roller coaster ride this year. Just over a month ago, the company's shares stood at their highest-ever level, reaching right under $750. In a month, shares settled down into the low $600s and closed yesterday right over $643. What a ride it has been -- from the $400s to the mid-$700s all in one year.

So, it comes as no surprise that yesterday a Credit Suisse analyst has raised his price target on Google shares to $900, representing the highest official price target on Wall Street. The reasons behind the target include the usual suspects: Google will realize gains as advertisers move increasingly online. Yes, that makes sense.

The unknown is the amount Google will grow based on that coming influx of more ad dollars. Of course, the company has had no problems growing substantially every single quarter its been a public company. so why should it slow now?

The analyst, Heath P. Terry, said Google is the best internet investment as all advertising goes digital. Although Google's ad revenue "all eggs in one basket" approach has been hailed as a one-trick pony, apparently Terry thinks the company can keep running the trick over and over again. Do you agree?

Deere shares rise after solid Q4 report

Filed under: Earnings reports, Good news, Deere and Co (DE), Commodities, Agriculture

Shares of Deere & Co. (NYSE: DE) rose $1.85 to $146.80 after the company reported Q4 EPS results above the consensus estimate.

Deere, the world's largest agricultural machinery company, reported Q4 EPS of $1.88, well above the Reuters consensus estimate of $1.54. Deere earned $1.20 in Q4 2006. The company reported Q4 revenue of $6.12 billion, compared to the Reuters consensus estimate of $5.24 billion.

Deere said profits from tractors, harvesters and combines almost tripled to $388 million on strong demand for advanced machinery from Brazil and Eastern Europe. In addition, the company said higher U.S. farm incomes helped boost North American sales of tractors and combines.

Continue reading Deere shares rise after solid Q4 report

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Do HP numbers make life harder for Dell?

Filed under: Earnings reports, Forecasts, Competitive strategy, Dell (DELL), Hewlett-Packard (HPQ)

Reuters makes the argument that strong numbers from HP (NYSE: HPQ) will cause the market to expect more from Dell (NASDAQ: DELL). The news service says HP "results may raise the bar for competitor Dell, which is more vulnerable to U.S. economic woes and reports earnings next week." Dell does get 85% of its sales from the U.S. market.

Wall Street is not so stupid that it has missed the vulnerability in the Dell model. HP's shares are up more than 20% so far this year. Dell's are only up 5%.

Dell only needs to report very modest numbers to please investors. Its new program to sell to consumers through retail outlets is only a year old and its push into key markets like China is in the early stages.

The question investors will have for Dell management is: what does 2008 look like? If the PC company cannot begin to pick up shares from HP, Lenovo, and Acer by then, the turnaround is no turnaround. It will have turned out to be a nice try.

Douglas A. McIntyre is an editor at 247wallst.com.