Semi-Upbeat Housing News
July 12, 2008
Tim Plaehn submits:
I am starting to find spots of recovery in the housing markets where I have some knowledge. I have been chronicalling here over the last few months the apparent start of a recovery in the Sacramento market. I have also lived for extended periods in Las Vegas and I am sharing the article linked here. Here are a couple of excerpts:
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Home sales in Las Vegas increased for the sixth straight month in June
Dave & Busters File for IPO - In This Market!
July 12, 2008
The Stalwart submits:
A shocking IPO candidate in this market… Dave & Busters, the Chuck-E-Cheese’s (CEC) for adults, whose locations can be found in subprime-sprawlville everywhere across America, has filed for a $170 million IPO. I suspect the company is particularly exposed to the weak economy, since it caters to a lot of mid-manager types who will be the first to get laid off when that starts to pick up.
I’m at a Whole Foods (WFMI) right now, so don’t have much time at the moment to pore through the S-1. If you do, let me know what you find. Happy hunting. If you don’t. I’ll go through it later.
Dave & Busters File for IPO - In This Market!
Adapting to Shifts in Market Regimes
July 12, 2008
Brett Steenbarger submits:
We all know that the way to make money in a bull market is to buy dips. And, indeed, that made traders and investors quite a bit of money from 2003 to mid-2007. As this three-year chart from the excellent Decision Point site makes clear, however, we have been lurching from one period of extended numbers of stocks making new 52-week lows to another since that time.
The chart shows the Wilshire 5000 Index (a very broad market proxy) versus the number of NYSE, NASDAQ, and AMEX stocks making new annual lows. In the right hand panel, we can see what that distribution has looked like over the past 21 trading days. We have had day after day of high/expanding new lows with nary a bounce in the market index.
Adapting to Shifts in Market Regimes
2007 Was Banner Year for Private Equity
July 12, 2008
Research Recap submits:
2007 was a “halcyon period” for private equity, according to a new study by Ernst & Young. PE exit returns, fundraising and deal volume all broke records during the year, though the latter six months were strongly affected by the global credit crunch.
E&Y’s sample of 100 PE companies outperformed public company benchmarks.
2007 Was Banner Year for Private Equity
The Fannie / Freddie Saga Benefits Short Sellers of Dollars, Financials
July 12, 2008
Grace Cheng submits:
Early this year there has been talk about how the US economy could experience a V or W or L-shaped economic situation, and now it seems that the economy could indeed be heading towards further deterioration. Although this past week has been one bereft of many major economic releases from the US or Eurozone, traders and investors have been subjected to more negative news coming from the US financial sector.
On Friday, the US dollar fell sharply against the Euro, Swiss franc, British pound and the Japanese yen in the currency markets as crude oil futures reached another all-time high of $147.27 on worries that Israel may be preparing to attack Iran, and on concerns that Fannie Mae (FNM) and Freddie Mac (FRE) - the two biggest sources of financing of home loans in the US - are insolvent, owing more money than what their assets are worth, and are having problems with raising enough capital to stay afloat. If you don’t know these two catchy-sounding entities, it’s time you do as these listed companies (they are actually Government-Sponsored Entities or GSEs) own or guarantee almost of the $12 trillion worth of US home loans, owning $5 trillion of debt.
The Fannie / Freddie Saga Benefits Short Sellers of Dollars, Financials
Rockwell Collins Inc. (COL, rated BUY)
July 12, 2008
BusinessWeek Rankings
Rockwell Collins, Inc. engages in the design, production, and support of communications and aviation electronics worldwide. It operates in two segments, Government Systems and Commercial Systems. The Government Systems segment supplies communications systems and products designed to help customers transfer information; military data link systems and related products; and navigation systems and products, including radio navigation systems, global positioning systems, handheld navigation systems, and multi-mode receivers. It also provides subsystems for the flight deck comprising flight controls and displays, information/data processing and communications, navigation, and/or safety and surveillance systems; cockpit display systems, integrated computer systems, and simulation and training systems. This segment serves the U.S. Department of Defense, other government agencies, civil agencies, defense contractors, and foreign ministries of defense. The Commercial Systems segment supplies integrated avionics systems and products; cabin electronics systems and products, including passenger connectivity and entertainment, business support systems, network capabilities, passenger flight information systems, and lighting and other environmental controls; and situational awareness, and surveillance systems and products. It also provides flight deck systems and products; integrated information systems; and electro mechanical pilot controls and actuation systems consisting of horizontal stabilizer and trim actuation systems, throttle quadrants, cockpit petals, and other pilot controls. This segment serves original equipment manufacturers of commercial air transport, and regional and business aircraft; commercial airlines; and fractional and other business aircraft operators. In addition, it offers engineering, maintenance, repair, and parts and after-sales support services. The company was founded in 1933 and is headquartered in Cedar Rapids, Iowa. Rockwell Collins Inc. (NYSE:COL) operates independently of Rockwell Automation Inc. as of June 29, 2001.
| Analysts’ Recommendation: |
Buy |
| 30 Days Ago: | Buy |
|
|
|
| Analysts’ Target: | $63 |
| Analysts’ Targets | |
| Jesup & Lamont | $61 |
| Buy | |
| Friday, July 11, 2008 | |
| Lehman Brothers | $65 |
| Equalweight | |
| Thursday, June 12, 2008 |
Rockwell Collins Inc. (COL, rated BUY)
Lehman Brothers Holdings Inc (LEH) is a SELL
July 12, 2008
SELL
rating on Lehman Brothers Holdings Inc
(LEH)
Start Price: $14.7801
Start Date: 07/11/2008
Lehman Brothers Holdings Inc (LEH) is a SELL
Graham Corp (GHM) is a BUY
July 12, 2008
GHM has a current Value of $99.01 per share. Therefore, it is undervalued compared to its Price of $78.85 per share . Value is computed from forecasted earnings per share, forecasted earnings growth, profitability, interest, and inflation rates. Value increases when earnings, earnings growth rate and profitability increase, and when interest and inflation rates decrease
(Growth to P/E Ratio): GPE is another popular measure of stock valuation. It compares earnings growth rate to P/E ratio. GHM has a GPE rating of 1.55 . High growth stocks are believed to be able to justify high P/E ratios. A stock is commonly considered to be undervalued when GPE is greater than 1.00 and overvalued when GPE is below 1.00. Unfortunately, this rule of thumb does not take into account the effect of interest rates on P/E ratios. The operative GPE ratio of 1.00 is valid when and only when interest rates equal 10%. With long-term interest rates currently at 5.99%, the operative GPE ratio is 0.36. Therefore, GHM may be considered to be undervalued
The MLS for commercial real estate (LOOP, rated BUY)
July 12, 2008
Loop has enviable position as the de facto multiple listing service (MLS) for commerical RE in the US. They offer this service quite cheaply, much cheaper than anything CoStar is doing, and much more comprehensive.
Business looks a little shaky due to RE malaise, but the stock is now cheap for a long term grower. The negative effect of economy is baked in. Rent or buy/sell, the US will still need an outlet for commercial RE transactions in any market.
The MLS for commercial real estate (LOOP, rated BUY)
Supervalu Inc. (SVU) is a BUY
July 12, 2008
BUY
rating on Supervalu Inc.
(SVU)
Start Price: $30.7
Start Date: 07/11/2008
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