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Buzz Bits: Elmer Hangs Up His Spurs

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Today on the Buzz

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Earnings Report - MV News

· Google (GOOG) reported Q4 EPS of $1.54 vs $1.77 cons on revs of $1.92 bln (in-line) including TAC and $1.29 bln (in-line) ex-TAC. Adjusted EBITDA was $814 mln vs $801.6 mln cons.
· Chiron (CHIR) reported Q4 EPS of $0.81 vs $0.51 cons on revs of $615.6 mln vs $558.6 mln cons.
· Symantec (SYMC) reported Q3 EPS of $0.26 vs $0.25 cons on revs of $1.25 bln vs $1.26 bln cons.





Fill 'er up, change the blades and check the corn? Why ethanol? -
Kevin Depew - 3:14 PM
For one thing, it is widely expected that tonight in his State of the Union Address President Bush will push for greater use of ethanol as an alternative energy source. Ethanol, made from fermented corn, has long been used as a fuel additive for automobiles whenever the price of gasoline moves higher. It is not new. The Energy Policy Act of 2005 requires
US ethanol production to increase to 7.5 billion gallons by 2012, about double current production. Put in historical terms, however, the number of ethanol plants peaked in 1984 at 163, producing 595 million gallons of ethanol.

Regardless, what are people looking to "play" as the potential for a government push toward ethanol and biofuels?

First, corn futures. March (with most open interest) gave a PnF by signal yesterday at 2.22. December is pushing resistance in the 2.60 area and yesterday registered a TD-Sequential 13 sell signal.
Among stocks, the most frequently mentioned plays are Archer--Daniels
Midland (ADM), with a large ethanol presence (it's up 9.5% today), and Pacific Ethanol (PEIX), (up a healthy 23.6% today), and Xethanol Corp. (XTHN), (up 44.8% today).





Flashback! -
Bill Meehan - 2:04 PM

This day in market history...

· Closing levels this day 10 years ago found
o DJIA: 5395.30
o S&P 500: 636.02
o Naz: 1059.79
o Crude: 17.76
o Gold: 405.55

This day in Minyanville history...


In other news…

· In 1999, John Elway led the Broncos to victory in his last game in Super Bowl XXXIII




For what it's worth - Jason Roney -
1:23 PM

Generally, the S&P 500 has a positive bias on the day of a FOMC release. So far today, the SP futures have yet to trade positive on the day, however. I looked for prior FOMC dates where the SP futures opened lower and remained negative until
2:15 EST (time of FOMC release). There were only 12 occurrences, but the results surprised me. The SP closed lower 10 of 12, below the open 10 of 12, and managed to trade positive just 3 of 12. (The last occurrence was the Nov. 2005 meeting).




I'm just a girl -
Jeff Macke - 12:52 PM

Yes, emailing Minyans, I'm long some Google (GOOG) going into tonight's Earnings Release of the Century. With the 14% Over/Under being suggested in the options market my thoughts are: 1. Not using any sort of automated stop-loss tools (which should never be confused with a "Guaranteed fill". If I put in stop at $400 today and GOOG opens at $350 in the morning, I'm out at $350; which doesn't excite me) 2. If I were being forced to trade it, say by a cadre of cruel galley-masters who would just as soon toss me to the the sharks as look at me, my instinct would be to take the other side of any extreme moves, should they occur, at about 10AM Wednesday morning.

But I no longer live in a world where I feel like I have to trade Google. I live in a world where my wife is making me own it so I do, in a size small enough such that I don't care all that much about tonight's call.

While we're Over-Sharing, a thoughtful Minyan shared this article about fatherhood in response to my mention of my own dad in this AM's blurb. Of course, I'm much too big and tough to find that kind of thing "moving"; I'm just sharing it in case you guys know anyone who would enjoy it.

Position in GOOG




Say What? -
Kevin Depew - 12:42 PM

A look at commentary, opinion and analysis from around the world:

· Turns out the U.S. government is now operating "technically" in default.
· "Given a list of search terms, can Google produce a list of people who searched for that term, identified by IP address and/or Google cookie value?" Absolutely.




That 70's Show - Adam Warner - 10:08 AM


It's official, Google (GOOG) has now hit 70 volatility in the near month. That 14% number Toddo quotes represents the "over/under" on the options board. If you think it will move more than that amount, you would buy volatility in really any time frame, and likewise you would sell it if you believe the reverse.
But the best insight I can offer (short of not playing with fire to begin with) is to define your risk on either side here. That is, make sure you have AN equal number of option contracts both up and down, as the screen here says literally anything could happen tonight.

Position in GOOG




Morning market comments from Katie Townshend, CMT, chief market technician for MKM Partners: - MV Technicals - 8:52 AM


"Several market bellwethers have fallen below important support levels recently. We believe this is a bearish indication for the market. When there is a lack of willing buyers at widely watched support levels, it may reflect a shift in the technical landscape. We summarize selected high profile breakdowns:

· General Electric (GE 32.93) reached a new 52-week low;
· Intel (INTC 21.65) reached a new 52-week low;
· Amgen (AMGN 72.32) fell below its 200-day moving average;
· Citigroup (C 46.82) fell below its 200-day moving average;
· Home Depot (HD 40.00) fell below its 200-day moving average;
· Texas Instruments (TXN 30.05) fell below its 200-day moving average;
· Apple Computer (AAPL 75.00) fell below its 50-day moving average;
· Google (GOOG 426.82) fell below its 50-day moving average."





Where Do I Sign? - John Succo - 8:49 AM


For those following Guidant (GDT) / Boston Scientific (BSX), things are really getting interesting.

First, remember when the final deal was struck with BSX wIlling to pay $80 something (it is a moving target with a collar) I said that I thought BSX would rue the day that they paid that high of a price. Nasty things can happen when the wrong price is paid (AOL/TWX).

Funny thing is out of 13 analysts who came out that day, none had anything negative to say about that fact and 7 recommended a strong buy on BSX. The stock then was $24 and is now $20.90.

GDT stock is down commensurately. In other words, the arb spread between the two is basically the same. Yesterday we saw arb accounts still buying GDT stock and puts and selling BSX stock.

Those just watching GDT would fear that more bad news about defib problems is causing the stock to drop. That may be the case, but it is affecting BSX as well.

In other words, the probablility of the deal going through is still very high since BSX almost certainly knows everything that is likely to come out (with a small probability they don't).

It is just now GDT problems are BSX problems. I guess the sell side missed that too.

Position in GDT
No positions in stocks mentioned.
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