Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Before the Bell: Ugly New Homes and McDonald's Challenges

By

New home sales took a dip. McDonald's beats but shares fall...

PrintPRINT
Ugly December In New Home Sales

According to Bloomberg, new home sales in December fell to a 12-year low, capping the worst year since recordkeeping began in 1963. Sales came in at 604,000, far below expectations. Economists had forecasted that the figure would be unchanged from the 647,000 rate reported the prior month. Further, median home prices plunged to $219,000, down from $244,700 reported last December. For more, read Professor Kevin Depew's Five Things You Need To Know.

From the Bull Pen: Bulls with a higher risk profile see a short term upside trade in Pulte Homes (PHM) and Hovnanian (HOV). Trailing sell-stops may be placed below $12.65 for PHM, and $7.35 for HOV.

From the Bear Cave: Bears are paying more attention to the glut of supply in the housing sector and may choose to play the downside in the iShares Dow Jones Real Estate Index Fund (IYR). Entry at $70 with buy-stops above.


Mickey D's Challenges

McDonald's (MCD) reported fourth quarter earnings yesterday of $0.73 per share. The figure was $0.02 better than analyst expectations. Revenue rose 5.7% year-over-year to $5.75 bln vs. $5.61 bln consensus. Fourth quarter same store sales globally came in at 6.7% vs. 5.9% consensus but below expectations in the U.S, 3.3% vs. 4.5% consensus. Shares of the company fell 5.6% due to investor concern over the company's ability to weather a downturn in the global economy and other challenges such as increased food prices. Get Hoofy and Boo's perspective in Fast Food: Caveat Eator.

From the Bull Pen: Professor Jeff Macke stated yesterday on the Buzz that McDonald's was due for a pullback, but favors the stock in the longer term. Sell-stops may be placed below $48.

From the Bear Cave: Bears looking for a downside play in the dining space may see one in Cheesecake Factory (CAKE). Entry at $22, which coincides with the 50-DMA with buy-stops above.

For more ideas, see Minyanville's Spotlight Stocks.


Quick Check Around the World

The Turnaround Tuesday ticks line up for the snap as foreign markets are trading mostly higher.

Asian trading closed with the Hang Seng +0.99%, Nikkei +2.99%, Sensex -0.34%, Taiwan +1.21% and Shanghai +0.87%.

A quick look across the pond finds the CAC +1.37%, DAX +1.03%, FTSE +0.96%, ATX +2.01%, Swiss Mkt. +1.15% and Stockholm +0.69%.


A Look At Commodities

Over in commodity land, crude oil is higher +0.49 to 91.48 and gold is down slightly, -0.70 to 932.10 this morning.


On the Radar

Economics

8:30 Durable Goods Orders: 1.9% cons
9:00 S&P/CaseShiller Index
10:00 Consumer Confidence: 87.5 cons

Click here for the full trading radar.

Happy Tuesday, Minyans! Good luck!


GET THESE INSIGHTS AND MORE IN REAL-TIME. CALL 212-991-9357 FOR A 14-DAY FREE TRIAL TO THE BUZZ & BANTER OR CLICK BELOW.
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE