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VIDEOTicker Shock: Four Reasons Monsanto May Mean Green Shoots
Thursday's top stories and stocks with potential to move.
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The Hang Seng was closed on holiday and the Nikkei was up 0.13%. Meanwhile, European stocks were in the red earlier this morning. And here in the US, we're currently trading lower.
Here's what I’m focused on this morning:
Monsanto (MON):
As many of you may already know, the stock got a bit of a smackdown in yesterday’s session on the heels of its outlook announcement. That said, I wanted to weigh in.
1. At the end of the day, it’s still looking for about $4.40 a share - not too shabby. Did the shares really deserve the more-than-6% haircut they got?
2. I realize it’s a simple argument, but longer-term, I think the demand for its seed business will be strong.
3. The dividend is sweet, too.
4. Although there’s a chance estimates could get scaled back a bit, looking at the ones that are out there, the company is still expected to show some nice growth in the future. That's worth a mention.
Bottom line, I'm more bullish than bearish. And longer-term, I think the shares have solid upside potential from this under-$80 level.
TiVo (TIVO):
The popular DVR maker was out with its first-quarter numbers. It lost $0.04 a share in the period, which was a little better than the nickel-a-share loss the Street had been expecting. Meanwhile, its service and tech revenues were in the ballpark of what analysts were figuring on.
To its credit, it seems like there are a few exciting things in the air. In the release, chief executive Tom Rogers said:
“Our work with Comcast is progressing on several fronts and Comcast passed along the following update to us. They are enthusiastic about the TiVo results so far in New England, and they're looking forward to launching TiVo soon in Chicago. Beginning this summer in New England, they are planning to launch a new feature called TiVo Online Scheduler that will let customers with the Comcast DVR with TiVo service and Comcast's high-speed Internet service manage and schedule recordings from anywhere they have Internet access. Also, as part of Comcast's all digital transition, Comcast will soon present its customers with the option to use the TiVo HD retail box as an alternative to a digital adapter provided by Comcast, with details to be announced soon. Finally, given the positive satisfaction levels in the New England market, Comcast has told us it plans to offer TiVo as the primary DVR option going forward in a yet-to-be announced tru2way market.”
The $64,000 question: Am I buying the stock on this news? No.
1. Perhaps I’m being short-sighted, but I’m not thrilled that it's expected to offer up red ink this year and next. (If profits were expected to be just around the corner, maybe I’d be more jazzed about these guys.)
2. I’m not heavily into charts, but the stock seems stuck in a rut lately.
3. I realize there are opportunities, as Rogers mentioned. But is that going to propel this stock to the next level? 4. And insiders, where are you?
I plan on keeping an eye on the situation, and will report back if my take on it changes.
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