Ticker Shock: Four Reasons that Lion's Gate Could Roar
Tuesday's top stories and stocks with potential to move.
Asian stocks rose overnight. The Hang Seng and the Nikkei were up 0.69% and 0.58%, respectively. However, 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:
Lion's Gate Entertainment (LGF):
Check out the well-known film studio's first-quarter results.
Per Reuters: "Excluding a gain on extinguishment of debt, Lions Gate posted a profit of $0.21 per share for the quarter ended June 30. On that basis, analysts were expecting a loss of $0.01 cent per share, according to Reuters Estimates."
Some quick thoughts:
1. I believe the wind will be at its back early in the session. Although I'd be reluctant to chase it too much north of $7.
2. With the stock above that $5 mark and these numbers, institutions may be more willing to give it some love.
3. Don't forget that Icahn is in this game and reportedly owns almost 17% of the stock. This guy is likely to be pressing management to find ways to get that stock price moving.
4. I'd like to see an insider besides Icahn pony up in the open market on the heels of this news.
It looks like Fossil spent its time (get it?) making a little money in the second quarter, but not much. It put up $0.25 versus $0.36 in the comparable quarter last year. But the good news is the number did come in well north of the $0.20 analysts had been figuring on.
1. The better-than-expected number will probably draw a fair amount of attention this morning, given the lack of other high-profile earnings announcements. And so I wouldn't be surprised to see the shares get a nice goose in early trading. In fact, this could end up being a nice in-and-out opportunity. In pre-market activity, it was up a smidge.
2. I also wouldn't be surprised to see this year's estimates get bumped up a little bit on the heels of this news, though I'm not expecting anything huge.
3. When all is said and done, I'd rather sit on the sidelines and watch (sorry, couldn't resist that pun) with the stock trading at more than 15.6 times the 2010 estimate. I believe there are better opportunities to be had elsewhere.
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