Archive for March 19th, 2008
Filed under: Major movement, Rumors, Rants and raves, Market matters, Scandals, JPMorgan Chase (JPM), Serious Money, Headline news, Bear Stearns Cos (BSC), Stocks to Sell
 There must a few other market saps out there like me who are wondering why Bear Stearns (NYSE: BSC) closed yesterday at $5.91 per share when it has been reported continuously for the last 72 hours that JP Morgan Chase (NYSE: JPM) was only paying $2 per share to take over the company. Now it is being reported that the figure is $2.34 — Oh boy!
I say market saps because I hold the stock and could sell it for more than the $2 but I don’t. Why not? What am I hoping for? Until this morning there has not even been the slightest rumor that some white knight will come to the rescue and acquire the company for more than the measly $238 to $276 million price tag being discussed.
Yesterday I wrote that what “JP Morgan Chase (NYSE: JPM) is paying for Bear Stearns (NYSE: BSC) would not have been enough to buy the brand name last year, never mind the whole company.” This being the case, I would love to see the line by line worksheet that the negotiators (some might call them scoundrels) assisted by the Federal Reserve Board worked up to determine the acquisition price. I understand that JPM is assuming a mountain of liabilities but I thought that the Fed has given JPM assurances that they would cover short term losses. In the long run, some of that bad paper is going to be worth billions of dollars.
Continue reading Serious Money: Why is $2 Bear Stearns stock trading at $6?
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Filed under: Merrill Lynch (MER), Options
 Merrill Lynch (NYSE: MER) is recently down 31 cents to $46.32.
MER call option volume of 16,496 contracts compares to put volume of 49,275 contracts. MER April 30 puts ($16 out of the money) have traded 191 times on transaction volume of 20,899 contracts, above its open interest of 19,719 contracts.
MER April option implied volatility of 70 is above its 26-week average of 46 according to Track Data, suggesting hedging for downside risk.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
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Filed under: Major movement, Rumors, Rants and raves, Market matters, Scandals, JPMorgan Chase (JPM), Serious Money, Headline news, Bear Stearns Cos (BSC), Stocks to Sell
There must a few other market saps out there like me who are wondering why Bear Stearns (NYSE: BSC) closed yesterday at $5.91 per share when it has been reported continuously for the last 72 hours that JP Morgan Chase (NYSE: JPM) was only paying $2 per share to take over the company. Now it is being reported that the figure is $2.34 — Oh boy!
I say market saps because I hold the stock and could sell it for more than the $2 but I don’t. Why not? What am I hoping for? Until this morning there has not even been the slightest rumor that some white knight will come to the rescue and acquire the company for more than the measly $238 to $276 million price tag being discussed.
Yesterday I wrote that what “JP Morgan Chase (NYSE: JPM) is paying for Bear Stearns (NYSE: BSC) would not have been enough to buy the brand name last year, never mind the whole company.” This being the case, I would love to see the line by line worksheet that the negotiators (some might call them scoundrels) assisted by the Federal Reserve Board worked up to determine the acquisition price. I understand that JPM is assuming a mountain of liabilities but I thought that the Fed has given JPM assurances that they would cover short term losses. In the long run, some of that bad paper is going to be worth billions of dollars.
Continue reading Serious Money: Why is $2 Bear Stearns stock trading at $6?
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Filed under: Analyst reports, Analyst upgrades and downgrades, Sara Lee Corp (SLE), Monster Worldwide (MNST), Kraft Foods’A’ (KFT)
.gif) MOST NOTEWORTHY: Priceline.com, Monster and Internap were today’s noteworthy downgrades:
- Susquehanna downgraded Priceline.com (NASDAQ: PCLN) to Neutral from Positive as they believe upside may be difficult given the macro environment, competition, and currency headwinds.
- JP Morgan lowered Monster (NASDAQ: MNST) to Neutral from Overweight following the company’s expectations for higher 1Q08 operating expenses.
- Internap (NASDAQ: INAP) was downgraded by Merriman to Neutral from Buy as they believe upside will be limited until the company can complete its integration of the VitalStream CDN acquisition.
OTHER DOWNGRADES:
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Filed under: Earnings reports, Forecasts, Consumer experience, General Mills (GIS), Morgan Stanley (MS), Commodities
 This morning, better-than-expected earnings results at Morgan Stanley (NYSE: MS) eased investors’ fears about the weak U.S. economy. Shares of food maker General Mills Inc. (NYSE: GIS) have been also rallying in early trading after posting a surge of 61% for its third quarter profit.
The company said its quarterly profit climbed to $430.1 million, or $1.23 per share due to higher demand for its products. Excluding one-time items, the company’s earnings figures came in at 87 cents a share, exceeding analysts’ forecast for a profit of 79 cents a share.
General Mills posted 12% growth for its third-quarter revenue, which surged to $3.41 billion from $3.05 billion a year ago. This was above analysts’ predictions for revenue of $3.24 billion in the quarter, according to Thomson Financial.
Continue reading General Mills (GIS) quarterly profit surges 61% on strong sales
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Filed under: Analyst reports, Analyst upgrades and downgrades, Sara Lee Corp (SLE), Monster Worldwide (MNST), Kraft Foods’A’ (KFT)
MOST NOTEWORTHY: Priceline.com, Monster and Internap were today’s noteworthy downgrades:
- Susquehanna downgraded Priceline.com (NASDAQ: PCLN) to Neutral from Positive as they believe upside may be difficult given the macro environment, competition, and currency headwinds.
- JP Morgan lowered Monster (NASDAQ: MNST) to Neutral from Overweight following the company’s expectations for higher 1Q08 operating expenses.
- Internap (NASDAQ: INAP) was downgraded by Merriman to Neutral from Buy as they believe upside will be limited until the company can complete its integration of the VitalStream CDN acquisition.
OTHER DOWNGRADES:
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Filed under: Earnings reports, Forecasts, Consumer experience, General Mills (GIS), Morgan Stanley (MS), Commodities
This morning, better-than-expected earnings results at Morgan Stanley (NYSE: MS) eased investors’ fears about the weak U.S. economy. Shares of food maker General Mills Inc. (NYSE: GIS) have been also rallying in early trading after posting a surge of 61% for its third quarter profit.
The company said its quarterly profit climbed to $430.1 million, or $1.23 per share due to higher demand for its products. Excluding one-time items, the company’s earnings figures came in at 87 cents a share, exceeding analysts’ forecast for a profit of 79 cents a share.
General Mills posted 12% growth for its third-quarter revenue, which surged to $3.41 billion from $3.05 billion a year ago. This was above analysts’ predictions for revenue of $3.24 billion in the quarter, according to Thomson Financial.
Continue reading General Mills (GIS) quarterly profit surges 61% on strong sales
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Filed under: Analyst reports, Analyst upgrades and downgrades, Bank of America (BAC), Countrywide Financial (CFC)
MOST NOTEWORTHY: Countrywide Financial, AstraZeneca, Massey Energy and International Coal were today’s noteworthy upgrades:
- Wachovia upgraded Countrywide (NYSE: CFC) to Market Perform from Underperform, as they do not expect any other bidders to emerge and for the acquisition by Bank of America (NYSE: BAC) to close.
- HSBC upgraded AstraZeneca (NYSE: AZN) to Overweight from Neutral on valuation and their belief that an agreement with Ranbaxy on Nexium is possible.
- Massey Energy (NYSE: MEE) and International Coal (NYSE: ICO) were upgraded to Neutral from Underweight at JP Morgan citing higher coal price forecasts.
OTHER UPGRADES:
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Filed under: Products and services, Google (GOOG), AT and T (T), Economic data
 When the Federal Communications Commission releases the results from its $19 billion auction of new wireless spectrum, all eyes will looking for one name: Google Inc. (NASDAQ: GOOG).
The search giant is eager to expand into the mobile world. Odds are that the company won’t outbid Verizon Wireless or AT&T Inc. (NYSE: T) for the “C” block of new spectrum that attracted a $4.74 billion bid. BusinessWeek has reported that Google probably withdrew from the bidding. But as The New York Times notes, Google scored a pretty significant victory already.
“While Google was not expected to post a winning bid, it has already achieved an important victory by influencing the auction rules,” the paper said. “The commission forced the major telephone companies to open their wireless networks to a broader array of telephone equipment and Internet applications.”
In other words, people can download whatever application they want to their mobile phones, which is exactly what Google wants to happen. Fortune recently noted that open standards are a central feature of Google’s Android mobile platform. Speculation abounds about Google’s interest in the mobile area, though the much anticipated Gphone has yet to materialize.
quot;We see Android as an important part of our strategy of furthering Google’s goal of providing access to information to users wherever they are,” Google Director of Mobile Platforms Andy Rubin recently wrote on the official company blog. “We recognize that many among the multitude of mobile users around the world do not and may never have an Android-based phone. Our goals must be independent of device or even platform.”
Shares of Google, like many other stocks, have gotten hammered this year because of concerns about a slowing economy. For Google to rebound from its 36% decline, the company will need to convince investors that great things are on the horizon. Google’s mobile strategy may help push the stock back to the levels many investors believe it is worth.
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Filed under: Goldman Sachs Group (GS), Lehman Br Holdings (LEH), Bear Stearns Cos (BSC), Initial public offerings
 It’s going to be a historic week. First, we experienced the meltdown of a mega financial institution, Bear Stearns & Cos. (NYSE: BSC). Second, Visa was able to raise a stunning $17.9 billion for its IPO with the share price coming to $44, above the $37-42 range.
True, it helped that the Fed came to the rescue (with creative approaches to apply liquidity) and that the Dow surged 420 points Tuesday, the day of the IPO. There were also earnings optimism from Goldman Sachs (NYSE: GS) and Lehman Brothers (NYSE: LEH).
Even without these, though, Visa would have performed well. Simply put, it’s a tremendous company.
It operates the world’s largest payments processing system - leading in terms of transaction volume, payment volume and cards issued.
Continue reading IPO takes Visa
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