Buzz Bits: Dow, Nasdaq Down Again
Your daily Buzz highlights...
Earnings Report - MV News
- Amazon.com (AMZN) reported EPS of $0.12 (in-line) on revs of $2.28 bln vs $2.23 bln cons
- RF Micro Devices (RFMD) reported EPS of $0.09 vs $0.06 cons on revs of $225.9 mln vs $210.05 mln cons.
- Corning (GLW) reported Q1 EPS of $0.27 vs $0.23 cons on revs of $1.26 bln vs $1.23 bln cons.
- Sanmina (SANM) reported Q2 EPS of $0.06 (in-line) on revs of $2.67 bln vs $2.69 bln cons.
Murphy Oil (MUR) reported Q1 EPS of $0.60 vs $0.72 cons on revs of $2.99 bln.
Hanks a lot! - Kevin Depew - 3:32 PM
- As we work our way through the final hour, I'm noticing that sell signals have accelerated internally in point and figure terms and are now outnumbering buy signals across the board.
- As has been the case for a few weeks now, the bullish percent indicators for the S&P 500 and Nasdaq-100 remain negative and at high risk levels.
- Beazer Homes (BZH) has broken a new double bottom at 61.
- Ryland (RYL) is resting near important support at 65.
- The St. Joe Company (JOE) has broken a new double bottom at 56.
- In the Drugs sector, new sell signals today from Chattem (CHTT) and Forest Labs (FRX).
- Finally, I'd be remiss if I didn't wish a happy birthday to (Minyan?) Hank Azaria today!
Flashback! - Bill Meehan - 3:25 PM
This day in market history...
- Closing levels 5 years ago
- DJIA: 10,625.20
- Naz: 2,059.80
- S&P 500: 1228.75
- Crude: 25.93
- Gold: 262.00
This day in Minyanville history...
- Macke wrote All Business is Personal after Ken Langone stepped in with regard to NYSE and AX. I gotta give snaps to any article that mentions Randy Savage, Hulk Hogan and the drunk guy at a wedding all in the same paragraph.
In other news...
- In 1831, the New York and Harlem Railway was incorporated in NYC
They call it... - Todd Harrison - 3:12 PM
Contra-hour comes to a close as traders trade and tensions grow. We've been eyeing this support level in the S&P for quite some time and it's the focus du jour in Matador Circles around the world.
Will it hold or will it fold? The tea leaves are pointing due south as market breadth is getting worse and the piggies poke session lows. We can pull out all sorta Minyanisms--As go the financials, so goes the tape. Tapes that are heavy all session tend to end that way. Breadth, when skewed 2:1 (either way) is the single best intraday tell. All true, and worth a noodle, but IF Hoofy can hold the line in the face of these colloquialisms, he could enter the hump with a leg to stand on.
I've been pretty active today, relatively speaking, as I "trade around" some cores and initiated some new trading tries in Apex Silver and United Healthcare. Small potatoes, for me, but Spuds McKenzie wants to "make 'em to take 'em" for the time being. I've got my meatier cores--as discussed--so I'm simply trying to make a little hay while the sun shines while adding a bit of value for ye faithful.
I hope this finds you well, Minyans, as we round third and ready for the heavy haul home.
Position in sil, unh, financials
I must be bullish, I must be bullish, I must be bullish, I must be bullish, I must . . . - Fil Zucchi - 3:02 PM
Oh - hi there! Sorry, I was absorbed in my new self-prescribed daily mantra to become a better person . . . .
The markets? Well they are splendid I would say! SPX 1300 is holding like a champ, the chippies (SOX) are a field of green, and consumer staples are all over Hoofy. What else can you ask for?
Yes the homies are red, but no biggie. That 6.9 months worth of condo inventory (up .9 months from March) is just what you need to gently cool prices off a bit so that the true homeowners that have been driving demand for the last 4 years can happily stroll back into the market. I even bought some upside protection on Beazer Homes (BZH) ahead of earnings. I mean, mid-single digit P/E's? How can that stock go lower?
And are you watching the relative strength of Akamai (AKAM) in the recent lousy tape? Hoofy, THAT's what I call a stud, dude. I just hope the crowd is not too enthusiastic about the prospects when they report manana. I mean, price pullbacks are "healthy," but just between us and the walls, we love 'em straight up to the moon (Alice).
Oops . . .gotta go Minyans, the Tooth Fairy is at the door for a late-lunch date!!
Position in SPX, BZH, AKAM
Martha, Martha, Martha - Jeff Macke - 2:22 PM
Greetings from slate-skied Nor. Cal where I'm nervously eyeballing my long-retail book ("with gas at $3 bucks plus? Doesn't it have to matter sometime?") and getting ready to attend Jeffmacke's Daughter's first ever parent - teacher conference. I keep brushing my head-stubble back and forth, asking Mrs. Jeffmacke if I should offer Those Who Would Presume to Teach my Spawn "laid-back Jeffmacke" (bangs) or the more stern "Mr. Jeffmacke" (slicked back).
Votes on the topic are being collected here.
Speaking of emotional pendulums, now that the founder has gotten refocused on core business concerns, I'm liking the newsflow mojo at Martha Stewart (MSO). By dumping KMart (SHLD) to go to Macy's (FD), Martha stops slumming with her K-Fed/ Tommy Lee-esque old dance partner and goes with someone who appreciates her, and the revenue she brings... not to mention treats her with more financial respect.
Nobody on earth will appreciate Martha more than the nation's biggest operator of Department Stores. [Insert your own snarky joke about cellmates here... I'm off to conference]
For whom the DELL tolls... - Vitaliy Katsenelson - 2:12 PM
I just got off the phone with Professor Brian Gilmartin. Among one of the stocks that we touched upon was Dell (DELL). On one side, DELL is taking the Wal-Mart (WMT) route (more on this in later articles), trying to appeal to demographics that are looking for PCs with more bells and whistles; a recent purchase of Alienware attests to that. However, Brian noted that to cut costs, DELL closed several support centers.
Thus, when Brian tried to get phone help for his newly purchased notebook, he was stranded on the credit card-like eternal hold. I heard a similar tale from other DELL owners. DELL is great at manufacturing and selling PCs but (intentionally) lacks a good support infrastructure. Brian and I both agreed that DELL's stock is very appealing at today's valuation. However, the news cycle could still get darker as consumers' disappointment with DELL's support gets louder, which could impact DELL's financials and the stock.
DELL is the best computer manufacturer out there, period. It generates a ton of cash flow as its vendors finance its inventory - just take a look at the cash conversion cycle, it is actually negative - the rarest and the best of kind. But not everybody is looking for the lowest price. Many may be willing to pay more and go with other makers such as Hewlett Packard (HPQ) or Gateway (GTW) that possibly provide better service. I understand that I am assuming that the other computer makers have a better service than DELL, they may or may not. I'd love to hear Minyans' comments on the issue.
Position in WMT
Bubbles, bubbles everywhere! - Bennet Sedacca - 11:26 AM
For those of you familiar with my work and my belief that history indeed repeats itself - I have drawn comparisons among Gold, Japan, Naz and Homies in the past here, see this chart for yet another look at human emotion - fear and greed - at work real-time.
This chart compares Intel (INTC) back in the late 90's-2000, Toll Brothers (TOL) and now Silver. All parabolic. All acting the same. Yes, I know, before throwing the tomatoes and old lettuce my way I am only making one point. NOTE TO SELF - Sell to the greedy and buy from the fearful....
Flixer upper - Herb Greenberg - 10:10 AM
Says another, "There, of course, is not much of a mention that average revenues per user hit an all time low once again to $16.87 while subscriber acquisition costs remain very high at nearly $40 per sub. So, there is deflation at the revenue side and inflation on the cost side -- not a good combo, but one that Netflix should be used to by now."
For what it's worth...!
Interesting Set Up For Amazon? - Phil Erlanger - 8:19 AM
We note that often in front of earnings Amazon (AMZN) sees both excess put and call activity. Monday there was NO excess activity on either side. Earnings are due after the close today. Our friends at www.orats.com note that Amazon normal moves in a range of $.81 and with earnings are expected to move $2.02. This is a proprietary calc built by the orats crew and we use it rather effectively with short interest.
We note short sellers are all over Amazon as short intensity is 74% with a short ratio of 5.19. Our technical rank is lagging at 20% and our shorter term direction indicator, the ETD, has yet to turn up but we are in the DMA channel which is a positive. Does it make sense to bottom fish here with the hope of a short squeeze on better numbers? Recently, we have had a couple of volume swing indicator buys while seasonality is mixed.
The answer in this case is that we have no edge. Often it makes sense not to trade if you do not have an edge and in this case there is none. To buy a stock only on the hope of a potential short squeeze without other indicators backing up which way to lean is a loser's game.
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