Buzz Bits: Dow, Nasdaq Sink
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Earnings Report - MV News
- Amgen (AMGN) reported 4Q EPS of $0.93 vs $0.94 cons on revs of $3.84 bln vs $3.71 bln cons.
- Microsoft (MSFT) reported 2Q EPS of $0.26 vs $0.23 cons on revs of $12.54 bln vs $12.08 bln cons.
- Sanmina (SANM) reported EPS of $0.07 vs $0.06 cons on revs of $2.78 bln vs $2.80 bln cons. Gross margin was 6.1%.
Juggle Buzz - Todd Harrison - 3:44 PM
- We noted the "size" insider buying at FCX yesterday and sure 'nuff, it's bucking the crimson tide (+2.65%).
- The VXO is up a beefy 20%. Fear? Downside capitulation? Bids wanted? Hardly. That doesn't mean we can't rally, of course, but a little perspective goes a long way. Take a look at a chart of the VXO. This picture is worth a thousand words.
- You don't have to make a macro tape call to make money. You simply gotta identify situations, remain conscious of the landscape and remain disciplined at all costs.
- I love the way SunMicro trades. I'm there, as you know, and remain inclined to buy this on dips rather than sell it on blips. $8 seems like a natural magnet all things being equal (read: we remain in a normalized market).
- Mea culpa on dropping the content (humor, snark) ball today. I'm digesting some non-business "stuff" on the other side of your screen. Life, as with anything else, is cyclical and we gotta focus on the important stuff. If anyone is long any Calgon, please feel free to forward it my way.
- Why are the markets getting hit? It sure isn't higher energy prices.
- My oft-stated risk profile remains much in tact although, in hindsight, I prolly shoulda been more proactive in "trading around" some of my driller positions. Hey--that's why discipline is so important. Sometimes it doesn't become obvious until after the fact.
- Fare ye well into the bell, Minyans, and keep your chin up. Tomorrow's another day--and it's the final 20% of our latest market chapter. Hey--we've got that going for us.
position in sunw, drillers
More WFMI Ruminatons - Fil Zucchi - 1:53 PM
As I sit here staring at SPX 1430 wondering if it'll stay or if it'll go, it continues to amaze me at how intrinsically cheap Whole Foods (WFMI) options are relative to what I perceive the two-sided risk to be.
Right now WFMI is drifting to new 52-week lows everyday because, IMHO, it has lost a lot of the go-go shareholder base; it has trapped a lot of short term players who "bought the dip" and are now dripping themselves; and at the same time the stock is nowhere cheap enough to attract value players. Those still in the stock are likely the "I buy and hold" types who believe that WFMI remains a "secular growth" story. Now, the latter may be right or may be wrong - we will see; but either way, from a "volatility" standpoint the stock is a powder keg. If the next quarter shows a clear comeback in all the metrics people look at, you could see this thing take off like a rocket, as the "growth darling" story is resurrected. If WFMI disappoints, I think the only leftover shareholder base will likely raise the white flag, and WFMI will find itself on a southbound train to the $20's.
In either cases those short options (i.e. short volatility) are likely to take a royal bath, while being long volatility (hedged directionally or not) are paying chump change for some potentially explosive returns.
Position in WFMI
Teaching New Dogs Old Tricks - Ryan Krueger - 11:28 AM
Take a look at the numbers released by Affiliated Managers (AMG), not because it's a stock to run out and buy today but because they are telling a bigger story in my view. One of the themes I shared at the beginning of the year was a strong belief in Wall Street decentralizing after years and years of consolidation, culminating in the destruction of the Glass-Steagall Act that lets brokers be bankers.
I think investors are rebuilding that wall brick by brick, one transfer of account at a time. They never wanted supermarkets, they wanted super returns and specialized advice on their assets, not more mortgage quotes. AMG has been snapping up the very businesses Wall Street used to know best but has been selling off – money management. The big boys assume their margins can only get squeezed, while the niche players have stolen their old playbook – page one: you get to name your price when you deliver better results, not brochures.
Position in AMG
Pattern Pickins - Tom Alexander - 8:40 AM
The Dow and S&P broke out of Balance Areas to the upside. The Russell remains below new yearly highs and the NASDAQ 100 is the weakest of these four indices. As long as yesterday's lows hold the pattern since the July lows, it suggests that the US indices should work higher for at least a few days, though this pattern also suggests relatively limited additional gains and that trading will again soon be dominated by sideways consolidation. See the chart here.
Wednesday's new highs in the Dow and S&P were not accompanied by higher highs in breadth, creating a potentially important divergence between those highs and this measure of market internal activity. See the chart here. The typical pattern in breadth is a surge on a breakout that forms a momentum high, then higher price highs and waning momentum as measured by breadth. The momentum peak for the present rally occurred on 1/11, suggesting the present rally is already on borrowed time.
Joining Macke, Dylan, Eric, Guy and Herb G on Fast Money Tonight in NYC! - Jon Doctor J Najarian - 8:35 AM
eBay (EBAY) Profits & Revenue Beat Estimates – We had very unusual option buying in EBAY and it seems those buyers had a good look into the crystal ball as net profit was up 24% to $349 million, on revenue of $1.72 billion.
Nokia (NOK) Tops 4Q Estimates - The world's largest mobile-phone maker said fourth-quarter net profit rose 19% to $1.65 billion, on a sales surge of 13%. NOK shipped 106 million handsets in the quarter, up 19% sequentially and 26% year on year. Shares are up $1.00 in the pre-market.
Netflix (NFLX) Subscribers Top Estimates – Saying nobody on the planet does what they do better, CEO Reed Hastings told shareholders NFLX added 654,000 subscribers in the quarter. Revenue for the period totaled $277.2 million, a 44% increase from $193 million in 2005.
Ford (F) Breaks Its Loss Record - The automaker's biggest annual loss in its 103-year history was $7.39 billion in 1992, but the company shattered that today, as they posed a $5.8 billion loss in the quarter, pushing its annual total to $12.7 billion!
Position in NFLX, NOK
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