Archive for March, 2009

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Buzz Stock of the Day- Celgene (CELG)

Monday, March 23rd, 2009


One of two things will happen within the biotech sector over in the short-run:

“We’ll either see a lot of companies disappear after their funds run out, or we’ll see a wave of consolidation in biotech,” said Michael Becker, CEO of consulting firm MD Becker Partners.

Coming to the table with speculative science in today’s market, as IBD pointed out, is an exercise in futility for small biotech companies looking to borrow money, or go public.

If biotech investing is appealing to you, we suggest you look at two criteria for companies:

1. Companies with operating cash flow
2. Companies that are likely acquisition targets

Our Buzz Stock of the Day, Celegene Corp. (Nasdaq: CELG) meets both. The New Jersey-based company generates strong free cash flow, yielded returns of 19.6 percent in 2008, and is projecting future growth.
According to a recent Motley Fool article, more than 95 percent of the Web site’s community are bullish on the stock.

New data expected later this year to support front-line use of the company’s myeloma treatment drug, Revlimid could also result in a “modest” uptick in U.S. adoption of the drug, according to a Cowen and Co. survey.

Celgene Corp. has about $2.2 billion in cash, and has quarterly revenue growth (yoy) of 51.5 percent. The company has operating free cash flow (ttm) of $182.1 million, and out performed the S&P 500 over the last 12 months. Shares of Celgene trade about 18 percent above their 52-week low.

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Posted in Health Care Stocks | No Comments »

Buzz Stocks for the week of 3/16/09- BWLD, PNR, ITT, TOL, CSUN

Friday, March 20th, 2009

Here’s a quick recap of this week’s Buzz Stocks.

3 out of our 5 daily buzz stocks ended the week higher.

Monday
Buzz Stock of the Day:
Buffalo Wild Wings, Inc. (Nasdaq: BWLD)
Open (3/16/09): $34.81
Close (3/20/09): $36.45
Percentage Change: +4.7
Click here to read the post

Tuesday
Buzz Stock of the Day:
Pentair, Inc. (NYSE: PNR)
Open (3/17/09): $19.01
Close (3/20/09): $20.33
Percentage Change: +6.9
Click here to read the post

Wednesday
Buzz Stock of the Day:
ITT Corp. (NYSE: ITT)
Open (3/18/09): $37.63
Close (3/20/09): $37.72
Percentage Change: +0.23
Click here to read the post

Thursday
Buzz Stock of the Day:
Toll Brothers, Inc. (NYSE: TOL)
Open: (3/19/09): $18.64
Closed (3/20/09): $16.54
Percentage Change: -11.2
Click here to read the post

Friday
Buzz Stock of the Day:
China Sunergy Co., Ltd. (Nasdaq: CSUN)
Open (3/20/09): $2.10
Close (3/20/09): $2.00
Percentage Change: -5%
Click here to read the post


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Posted in Consumer Discretionary Stocks, Energy Stocks, Industrial Stocks, Materials Stocks | No Comments »

Buzz Stock of the Day- China Sunergy Co. (CSUN)

Friday, March 20th, 2009

Declines in inventory value have plagued the results of solar companies including LDK Solar Co. Ltd. (NYSE: LDK) and Canadian Solar, Inc. (Nasdaq: CSIQ), both of which have all felt the crunch from the write downs they have to take because of cancellations and postponed orders that have resulted from current market conditions.

Another key contributor to the lackluster performance of solar companies is a pullback in solar subsidies in Germany and Spain and a strengthening U.S. dollar against the euro, which has sent prices of solar products tumbling.

Our Buzz Stock of the Day, China Sunergy Co., Ltd. (Nasdaq: CSUN) is no exception.

“China Sunergy has faced the same unprecedented and volatile environment as many of our peers across the solar sector, as a result of the ongoing global financial crisis,” according to China Sunergy Chief Executive Dr. Allen Wang.

Excluding items, China Sunergy reported an adjusted loss of 42 cents per ADS, wider than analysts’ estimates of a loss of 32 cents. Revenue fell nearly 40 percent to $43.2 million. Weak demand and prices hit China Sunergy’s gross margins, which came in at negative 33.1 percent for the quarter.

But “expectations were pretty low,” according to Jeffries’ analyst Paul Clegg, who doubted that investors would be”deeply disappointed relative to expectation.”

Clegg said there was a lot of uncertainty on when demand in the end markets would recover and investors “would be well served to take a conservative outlook in 2009.”

Despite the dim results, there is a ray of sunshine in China Sunergy’s future.

The company said it expects margins to be “definitively” positive in the second quarter and sees it in the range of 15 percent to 20 percent for the second half of the year.

The number of solar cells the company shipped in 2008 increased 45 percent over 2007. China Sunergy said it will continue to focus on growing sales of its high efficiency cells as a percentage of total shipments to benefit from increased margins.

China Sunergy remained cash flow positive despite a 39 percent decline in overall shipments, to 14.1 megawatts (MW). The company expects to shipments of between 150 MW to 200 MW for 2009.

“We expect conditions to remain difficult in the coming quarter, however we retain our belief and confidence that our advanced solar cell offerings, coupled with our R&D, engineering and manufacturing capabilities will ensure the Company fulfills its long-term potential,” Wang said.

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Buzz Stock of the Day: Toll Brothers, Inc. (TOL)

Thursday, March 19th, 2009


The housing industry is a good bellwether for the economy, and the Federal Reserve knows it.

That’s probably why it reiterated its commitment to keeping interest rates at record lows, and announced plans to buy an additional $750 billion in mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac, bringing its total purchases of these securities to $1.25 trillion.

Analysts said the move is likely to produce an immediate drop in mortgage rates, of 0.25 to 0.5 percent percentage points. The central bank also made clear it would be able to purchase the majority of new mortgage-backed securities for at least the rest of the year, possibly longer.

“That could be very good news for us,” said Brent Anderson, vice president of investor relations for Meritage Homes Corp. (MTH), whose shares jumped 16% to $13.39. “Lower rates translate to lower payments, which are what buyers are looking for today.”

It could also be good news for our Buzz Stock of the Day, Toll Brothers, Inc. (NYSE: TOL), which is offering incentives for new homebuyers that include price discounts and below-market mortgage rates.

Last Tuesday’s report by the Commerce Department, which stated that housing starts jumped a surprising 22 percent, after three straight months of 15 percent sequential declines could also bode well forr Toll Brothers, Inc. since the company is a leading builder of multifamily starts.

Michael Rehaut of J.P. Morgan stated in a research report that February’s 22 percent jump in total starts was “entirely driven by an 82 percent rise in multifamily starts.”

Shares of Toll Brothers have been pretty resilient over the last 12 months, dropping about 16 percent, compared with competitors Hovnanian Enterprises, Inc. (NYSE: HOV) whose stock has dropped about 85 percent, and Lennar Corp. (NYSE: LEN), which is down about 41 percent.

A recent article stated that Toll Brothers, Inc. is “in better shape than most big builders trying to manage in this economic downturn.” The company’s losses are in the millions, while others have losses in the billions. “More importantly, their cash flow statement is positive in the midst of trouble.”

If you think the housing sector will grow some legs over the next 6 months, Toll Brothers, Inc. could be worth considering.

Posted in Industrial Stocks, Materials Stocks | No Comments »

Buzz Stock of the Day: ITT Corp. (ITT)

Wednesday, March 18th, 2009

Last week, engineering giant, ITT Corp. (NYSE: ITT) announced a $317 million order from the U.S. Naval Systems Command for the company’s vehicle receiver jammers–vehicle-mounted systems that prevent the detonation of improvised explosive devices, or IEDs.

According to a recent news release, the contract has the potential to swell to $1.7 billion.

In addition to its work with the armed forces, ITT has a great foothold in the infrastructure market, particularly in water treatment.

ITT’s vice president of business development, Colin Sabol recently stated: “Communities around the country, from major metropolitan cities to rural small towns, are now working to secure funds to launch much-needed infrastructure projects, such as drinking water and wastewater projects,” said Colin Sabol, vice president of business development for ITT’s Fluid Technology business. “ITT has extensive experience with the planning and creation of such projects, and measuring how project success produces benefits to the health and economy of a community.”

ITT Corp.’s stock has outperformed the S&P 500 over the last 52 weeks. With a trailing p/e of 9 (which is in line with many of the company’s competitors), operating cash flow of about $1 billion (ttm), quarterly revenue growth (yoy) of more than 16 percent, and shares trading near their 52-week low, this could be a good time to consider ITT Corp. for your portfolio.

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Posted in Industrial Stocks | No Comments »

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