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business newsSohu Searching for Answers
By
Justin Sharon
Nov 09, 2010 5:00 pm
The Chinese Web portal fell almost 6% today after a downgrade to Neutral from Buy from analysts at UBS.
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Turn to Why Sohu.com and Shanda Interactive Are Buys for extra insight.
Unlike my namesake Timberlake, I would never dare diss beautiful Jessica Biel in the admittedly unlikely event our paths ever cross. For one thing, I’d be afraid she’d get her vengeance by giving me a virus, as she just overtook Brad as the most dangerous celebrity to search in all of cyberspace. Which leads us to Symantec Corporation (SYMC), today’s headline upgrade. The Internet security outfit, whose best-know brand is Norton, saw its rating raised to Buy from Hold at ISI Group, which also increased its 12-month price target by a hefty $5 to $17. The brokerage believes that Symantec’s strong execution is poised to deliver top-line expansion and ultimately improved operating margin leverage. Spyware, spam, phishing, and all its malicious malware ilk stand squarely in Symantec’s cross-hairs, and while I can’t help but feel it's in the best interests of such firms to act ever so slightly alarmist over such threats, a better-safe-than-sorry attitude among America’s computer users has undoubtedly been a boon to the company’s bottom line. They reported Street-beating revenues for the fiscal second quarter of $1.48 billion at the end of October and operating margins of 25.1% also exceeded consensus analyst estimates of about 21.5%. In this morning’s upgrade ISI also cited the company’s potential as a takeover target, and it’s a sector that has undeniably experienced an upturn in such activity of late. Most notably with an utterly unexpected announcement out of Intel (INTC) that it intends to acquire McAfee (MFE) for $7.68 billion in August, the same month Symantec itself bought VeriSign’s (VRSN) security business. Reasons for caution include an ongoing mix shift toward low-end PCs and tablets, and the fact that organic growth is up against increasingly tougher comparisons in upcoming quarters.
Please see Cybercrime Was the Case That They Gave Snoop, McAfee-Intel Deal a Game Changer for Endpoint Security Market, and Free Antivirus Software Now Comes With Free Viruses.
Shanghai-based JA Solar Holdings (JASO) ended down almost 4% after indicating up over 8% before the opening bell, a redundant reminder that this industry ain’t for the faint of heart. Some sell-the-news on a stock priced for perfection was always the right response even to today’s impressive earnings report, with the shares having already run an astronomical 145% plus in 2010. The world’s largest manufacturer of monocrystalline and photovoltaic cells used to convert the sun’s light into energy posted third-quarter earnings of $77 million, or $0.47 per share. This easily improved upon its $0.10 of a year-ago and also exceeded analyst forecasts of only $0.34. The company further announced an additional 600mw of solar product supply agreements for 2011 delivery, and increased its full-year earnings guidance. From the White House to West Texas, solar energy is suddenly sexy, even if erstwhile oilman J.R. Ewing doesn’t need to endorse anybody after alter ego Larry Hagman recently got a $11.6 settlement from Citigroup. JA Solar went public in 2007, about the same time the world belatedly woke up to the fact that China is home to 16 of the world’s 20 most polluted cities, and even if you're not a Peak Oil proponent alternative fuels are a must for the world’s fastest growing economy going forward. Rewards are tempting but risks are real from flying too close to the sun as any Icarus can attest to. Imminent solar subsidy cuts in Germany and Italy are but one red flag that investors in an inherently volatile sector should be aware of.
Also check out Trendspotting: Investing in Renewable Energy, Proof That Solar Power Works, and Asia Could Boost Solar ETFs.
Dean Foods (DF), the nation’s largest dairy processor, once employed comedian Wayne Brady to plug its line of International Delight coffee creamers but the company is currently crying over spilt milk. Shares finished the day with a slide of almost 18% to touch its lowest level since early August of 1999 and was easily the worst performer on the entire S&P 500 Index. You’d have a cow too after reporting a 51% implosion in net income to $24.3 million, or $0.13 on an EPS basis, from $49.7 million or $0.27 12 months ago. Analysts were looking for $0.21, and the shortfall was compounded by news that CFO Jack Callahan is to resign. The “ex-food-and-energy” crowd of economists who claim inflation is absent obviously don’t inhabit the real world, if a remarkable 70% increase in the price of class II butterfat is any indication. CEO Gregg Engles also cautioned that “the retail environment continues to be very competitive.” Analyst Terry Bivens at JP Morgan, home to Wall Street’s top-ranked research in last month’s Institutional Investor survey, added that “fourth-quarter guidance also indicated ongoing major problems.” Them bones do need calcium but investors are understandably lactose intolerant on the shares.
Dairy Farmers Charged With Price Fixing and The Rising Cost of Farming have more.
No positions in stocks mentioned.
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