Joseph Lazzaro
New York - http://
Anadarko: Well-positioned for the oil/natural gas boom
So much for oil plummeting to $30 per barrel on a supply glut. The price of oil, the world's most vital commodity, is currently largely divorced from supply/demand fundamentals, and that's one reason I'm reiterating my buy rating for oil/natural gas company Anadarko Petroleum Corp. (APC), first recommended on May 14, 2009. at a price of $43.55. If you bought APC in May, you're up about 45%.
Look for APC to post a 2% to 4% production increase in FY2009, followed by a 4% to 5% rise in FY2010. Further, institutional investors are looking past this year's likely bottom-line loss, and toward better quarters in FY2010 -- which is a major reason Anadarko's stock is up substantially since May.
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TJX: Back up the truck
If you haven't already and you can tolerate moderate risk, now's the time to purchase shares of The TJX Companies (TJX) and I'm reiterating my buy rating, first recommended on June 22, 2009 at a price of $21.48. If you bought TJX in June, you're up about an impressive 80%.Off-price family apparel and home fashion retailer TJX (operator of the T.J. Maxx, Marshalls and HomeGoods chains) is in the discount retail sweet spot: it's poised to gain market share in the era of the 'frugal consumer.'
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Is dollar destined to dive in 2010?
Is a continued weakening in the dollar in the first half of 2010 a fait accompli? Not so fast.The median prediction in Bloomberg's survey of as many as 43 strategists shows the dollar gaining against the euro, British pound, yen, Swiss franc, and Swedish krona by September 30, 2010, Bloomberg News reported Monday.
Continue reading Is dollar destined to dive in 2010?
Entergy: Pull-back is buy opportunity
Unlike France, the United States did not build nearly enough nuclear power plants in the last two decades of the 20th century to accommodate its power needs, and it will spend the next two decades playing catch-up, which is why I'm reiterating my buy rating for Entergy Corp. (ETR), first recommended on May 12, 2009, at a price of $74.31.
Entergy, the second largest nuclear power generator in the U.S. (30,000 megawatts) will be a part of that mix, with its regulated utilities likely to register average earnings per share growth of 5% to 7% over the next three years. Meanwhile, the planned spin-off of its non-utility-regulated nuclear business, called Enexus, holds the promise of even stronger revenue and earnings growth. The First Call FY2009/FY2010 EPS estimates for ETR are $6.37 to $6.70.
Continue reading Entergy: Pull-back is buy opportunity
Nike is in an uptrend
After meandering for most of the summer, Nike Inc.'s (NKE) stock has accelerated above its 50-day moving average, and that's one reason I'm Reiterating my Buy rating for the company's shares, first recommended on May 12, 2009 at a price of $50.98. If you bought NKE in May, you're up about 27%.Look for Nike to record a roughly 7-9% earnings gain in 2010, aided by emerging market sales gains. What's more, the major source of institutional investors's (IIs') concern this summer – U.S. sales – appears to be fading: 2010 U.S. sales will likely drop 2-3%, due to the continued 'frugal consumer' trend – a down year but certainly not a disaster, for NKE, which does about 60% of its business outside the U.S. The First Call FY2010/FY2011 EPS estimates for NKE are $3.65 to $4.01.
Continue reading Nike is in an uptrend
Dominion Resources: Back up the truck
Rare is the day you should sell an electric power generation play, which is why I'm reiterating my buy rating for Dominion Resources (D), first recommended on May 8, 2009, at a price of $31.87. If you bought Dominion in May, you're up about 16%.
Dominion, a fully integrated natural gas and electric holding company, is on-track to register 2% to 4% revenue growth on higher utility revenue in F2009, but also aided by the completion of the Cove Point liquid natural gas facility. Debt reduction, as well as planned expansion of wind generation and other power projects, adds to the positive story. Dominion's annual dividend is $1.75.
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TransCanada: Pull-back is buy opportunity
TransCanada Corp.'s (TRP) shares, first recommended on May 11, 2009, at a price of $26.56, have pulled back, and the dip represents a buy opportunity, which is why I'm reiterating my buy rating for the stock.
TransCanada is natural gas play with promise: it's a natural gas transmission and storage company that also owns oil assets and electric power generation assets (including 19 wholly-owned power plants). A solid $1.45 annual dividend adds to the positive story.
Continue reading TransCanada: Pull-back is buy opportunity
ECB Trichet's comments show central banks' delicate balancing act
European Central Bank President Jean-Claude Trichet jolted the markets Friday with the announcement that the ECB will gradually withdraw the emergency cash injections it has added to the financial system, in order to prevent an acceleration in inflation."Not all our liquidity measures will be needed to the same extent as in the past," Trichet said at a conference in Frankfurt Friday, Bloomberg News reported. "Any non-standard measure whose continuation would pose a threat to the achievement of price stability must be undone promptly and unequivocally."
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Look for ADP to rise with payrolls
If, in fact, jobless claims have peaked, that's good news for payroll services specialist Automatic Data Processing (ADP), and that's one reason I'm reiterating my buy rating for the company's shares, first recommended on June 22, 2009 at a price of $36.84. If you bought ADP in June, you're up about 20%.Despite the worst recession in more than 25 years – one that has devastated payrolls – ADP has held its own, with its stock price this year recovering about one-half its loss following the drop from its peak in 2007.
Continue reading Look for ADP to rise with payrolls
Tyson Foods: Meandering into the new year
Tyson Foods' (TSN) stock has meandered since first recommended on May 11, 2009 at a price of $12.35, but I'm sticking with the stock. Here's why: First, Tyson has the product diversity to adjust to increasingly demanding, educated U.S. consumers, who may, for example, favor chicken over pork one month, then do an end-run and return to red meat when steak prices drop.
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Under the radar: Rising demand for Mexico-built auto engines is another recovery sign
Under the radar: Some trends are obvious enough and visible to all investors. Others are more-subtle, but are just as potent, and these often slip 'under the radar.'Case in point: Demand for Mexico-built vehicle engines is rising, helping to pull Mexico's economy out of it's recession, Bloomberg News reported.
The significance for investors? The increased demand for engines made south-of-the-border is being driven by a rebound in U.S. auto sales. Again, the increased sales trend is nothing to write home about -- U.S. automaker new vehicle sales rose in October and are expected to rise in November, as well, according to data compiled by Edmunds.com, Dow Jones reported, but the important dimension is the trend's direction.
United States on verge of historic Senate debate on health care
Any experienced investor knows that these are not normal times. But they could become truly historic times, if the United States is able to pass universal health care legislation in the the weeks ahead. Sen. Majority Leader Harry Reid, D-Nevada, has crafted a health care bill that would cut the U.S. budget deficit by about $130 billion over 10 years, while extending coverage to up to 94% of Americans, The Associated Press reported Thursday. The bill's estimate cost is $848 billion.
Continue reading United States on verge of historic Senate debate on health care
Goodyear Tire is undervalued
Goodyear Tire & Rubber Co.'s (GT) stock has meandered of late, but I'm nevertheless reiterating my buy rating for the company, first recommended on May 5, 2009 at a price of $13.30. Here's why. Institutional investors sold GT after the company reported a 15% reduction in Q3 revenue, and the view from here argues the selling was overdone. Goodyear will benefit from tire demand growth in 2010.
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Capital One: Close position, take profits
As expected, Capital One Financial Corp.'s (COF) stock has seen increased interest in the past six months, on the argument that charge-offs will peak in mid-2010. First recommended on May 7, 2009 at a price of $29.41, if you bought COF in May, you're up about 37%. However, technically the stock will face substantial two-year resistance at $43-45, more resistance above that, and then psychological resistance at $50. That's considerable resistance to overcome in a modest-growth U.S. economy.
Continue reading Capital One: Close position, take profits
Consider Schlumberger, because oil isn't going out of style
One can look at likely rising oil and gasoline prices one of two ways. You can get frustrated, or you can profit from it by buying Schlumberger Ltd. (SLB), which is why I'm reiterating my buy rating for the company, first recommended on May 6, 2009 at a price of $56.09. If you bought SLB in May, you're up about 18%.Some in the oil sector remain concerned about the recovery in demand for oilfield services. Based on the growth track for emerging markets, that concern is not warranted: the natural gas segment may encounter some head-winds, near-term, because in that energy commodity, the glut of supply has actually been matched by a low price. But oil? Forget about it. Business is booming: the supply glut of oil has done little to lower its price, which shows one the many roles oil plays (alternative asset, inflation hedge, weak dollar hedge) in the modern economy, to Schlumberger's benefit. The First Call FY2009/FY2010 EPS estimates for SLB are $2.71 to $2.81.
Continue reading Consider Schlumberger, because oil isn't going out of style
Struggling Playboy outsources business ops
J. Crew earnings preview: A strong Q3 all buttoned up?
Twitter to make acquisitions, generate revenue in 2010
