Security News Highlights

November 19, 2014

The following is our accumulation of some of the major News Highlights, Analyst Rating changes on Stocks (downgrades and upgrades) and stock earnings news.

• Keystone Pipeline failing by one vote. Not to worry the republicans will bring it up for vote in January 2015 when they take control of the Senate.
• Jerusalem Attack Shakes Israel
• Apple, Google, Facebook and others Encrypt Phones, Fueling Government Standoff.  “Look, if law enforcement wants something, they should go to the user and get it.  It’s not for me to do that.”  Tim Cook
• Air-Bag Recall Nationwide called against Takata by NHTSA. A push for recall of Air-Bags. Some of the auto makers involved are: Honda, Chrysler, Ford, Mazda and BMW.
• Goldman is the top Merger and Acquisition bank for advisory fees. Hits Mother Lode on Deals
• Largest U.S. REIT IPO Sees Healthy Demand.  According to Barron’s it was founded by the Otto family of Germany in the late 1960s, Paramount Group is the fifth-largest REIT behind Vornado Realty Trust (VNO), Boston Properties (BXP), SL Green Realty (SLG) and Kilroy Realty (KRC) based on its IPO price.  The last large public offering by an office REIT, the $1.1 billion Empire State Realty Trust(ESRT) deal October 2013, was rose just 0.8% in its first day of trading.
• SunEdison (SUNE) – Its purchase of First Wind would make it the world’s biggest renewable energy development company.
• JA Solar Hldgs (JASO) – saw increase in Revenue and Profit due to strong demand in China and Japan
• Medtronic (MDT) – Revenue for the quarter rose on strength across its segments
• Urban Outfitters (URBN) –  Quarterly earnings dropped missing expectations
• HomeDepot (HD) –  Warned that Costs could rise from a data breach – Estimated cost is $34 Million in 2014.
• Omega Protein (OME) – Profit and revenue fell in the third quarter
• Toyota Motor unveiled a $57,000 fuel-cell car and plans for a U.S network of Hydrogen-fueling stations.
• PetSmart Profit slips despite sales rise.
• IBM gets closer to Consumer Again – offering a web based service called IBM Verse.
• Actavis to buy Allergen.
• Merck & Co.’s drug Zetia proved effective at reducing risk of heart attacks, strokes and other heart problems in a large, long-awaited trial, marking a milestone in the 40-year-old battle to fight cardiovascular disease by lowering cholesterol.
• Halliburton Co. ’s plan to spend almost $35 billion to buy smaller oil-field services rival Baker Hughes Inc. underscores the new realities for energy companies in a world suddenly awash with oil.
• Natural gas futures pared day-earlier gains on Tuesday as weather forecasts for extreme cold in the coming weeks softened, moderating expectations for gas-fired heating demand.  Natural gas for December delivery ended the day down 9.7 cents, or 2.2%, at $4.244 a million British thermal units on the New York Mercantile Exchange, giving back a fraction of Monday’s nearly 8% gain in its biggest rally since February.
• TOKYO—Japan’s economy shrank for a second quarter in a row, after a sales-tax increase took the steam out of Prime Minister Shinzo Abe ’s bid to turn Japan into a global model of revival.
• Warby Parker has made a name for itself by selling affordable, hipster-chic eyeglasses through a website, avoiding costly store expenses and licensing fees.
• Facebook, the world’s biggest social network, is developing a professional site, Facebook at work, that will compete against LinkedIn. Plus, how changing the way you walk, smile and talk can boost your mood.
• Nikkei advances on weak yen, global demand hopes Depreciating yen boosts exporter shares
•  Investors buy Honda, Canon – October export growth offers respite from economic gloom By Thomas Wilson TOKYO, Nov 20 – Japanese stocks edged up on Thursday as a further weakening of the yen boosted market sentiment. The Nikkei benchmark added 0.2 percent to 17,318.85 by 0142 GMT, not far from a seven-year high scaled last week. “A huge chunk of Japanese corporate profits come from overseas, and with the weak yen.

Stock Upgrades and Downgrades

• Almost Family Inc. (NASDAQ: AFAM) was raised to Neutral from Underperform at R.W. Baird.  BlackBerry Ltd. (NASDAQ: BBRY) was downgraded to Underweight from Equal Weight at Morgan Stanley.  CF Industries Holdings Inc. (NYSE: CF) was raised to Outperform from Neutral with a $315 price target (versus a $269.69 close) at Credit Suisse  Columbia Sportswear Co. (NASDAQ: COLM) was raised to Buy from Neutral at Citigroup.  Consolidated Edison Inc. (NYSE: ED) was downgraded to Sell from Neutral at UBS  Denbury Resources Inc. (NYSE: DNR) was downgraded to Hold from Buy at Wunderlich, after having been downgraded elsewhere too.  Enbridge Inc. (NYSE: ENB) was raised to Outperform from Neutral at Credit Suisse.  Halliburton Co. (NYSE: HAL) was reiterated as Buy at Argus after the Baker Hughes deal, although the price target was slashed to $64 from $84 in the post-merger views.  Potash Corp. of Saskatchewan Inc. (NYSE: POT) was raised to Outperform from Market Perform and given a $40 price target (versus a $35.40 close) by Raymond James.  Rackspace Hosting Inc. (NYSE: RAX) was started as Overweight with a $52 price target (versus a $42.70 close) at Barclays.  Synchronoss Technologies Inc. (NASDAQ: SNCR) was downgraded to Underperform from Neutral and the price target was cut to $42 from $47 at R.W. Baird  Total System Services Inc. (NYSE: TSS) downgraded to Sell from Neutral at Goldman Sachs. 
• Staples (SPLS) is up 8% after beating earnings and announcing an expansion of its store closings. The company now plans to shutter 170 stores in North America this year, 30 more than the 140 previously announced. As we discussed Monday, Staples is rather surprisingly the second or third largest online merchant in the United States. Despite today’s move, shares are down 13% for 2014.
•  Tesla (TSLA) is getting smoked by 3.8% after Morgan Stanley (MS) slashed estimates for deliveries. The analyst says the Falcon wing doors on the Model X are too complicated for mass production. Tesla CEO Elon Musk quickly took to Twitter, refuting the claims. For now Wall Street believes Morgan Stanley. Not helping bulls is the fact that Tesla shares had ripped straight into overhead supply in the mid-$250s, as noted in this chart I tweeted a couple weeks bac
• Target (TGT) started strong and it’s gaining steam, now up more than 7% after the company reported earnings of $0.54, well ahead of $0.47 estimates. Minnesota’s finest discounter also said it expected holiday quarter U.S. same store sales of 2% driven by a decent consumer and a rebound from a terrible 2013 when a data breach was revealed just ahead of Christmas. In the words of my native tongue: “Oh jeez we’re just tearing the shorts a new one dere.”
• Alibaba (NYSE: BABA) shares are on watch following quarterly results from segment peer Vipshop (NYSE: VIPS).   After markets closed Tuesday, Vipshop reported Q3 non-GAAP EPS of $0.08, which came in 1 cent better than the analyst estimate of $0.07. Revenue for the quarter came in at $882.6 million versus the consensus estimate of $863.12 million. Non-GAAP net income attributable to Vipshop’s shareholders, which excludes share-based compensation expenses and amortization of intangible assets resulting from business acquisitions, increased by 206.8% to $46.3 million from $15.1 million in the prior year period.Alibaba is looking to a number of avenues for further growth opportunities. The e-commerce giant is building its operating system YunOS, which Alibaba’s Executive Vice Chairman, Joseph Tsai, believes will be a strong contender in the Chinese market. He believes the OS will replace many Google services that are not available in the country, and hinted the company could even integrate its e-commerce offerings and operating system in the future.Alibaba is also now looking to enter Hollywood after acquiring a 37.4% stake in Lions Gate Entertainment Corp. (USA) (NYSE:LGF). Jack Ma is looking to bring US entertainment productions in the form of films and TV series to China, the second-largest entertainment in
• RF Micro Devices, Inc. (NASDAQ:RFMD): By the end of last trading, the RF Micro Devices (NASDAQ:RFMD) shares earned US$0.40 (or 3.00%) to US$13.75 with about 14.99 million shares exchanged hands for the session, compared to its average volume of 13.54 million shares. Both RF Micro Devices and TriQuint make radio-frequency systems used in smartphones, wireless infrastructure and other applications. The merge between them is awaiting approval from regulators in China, where both firms have significant operations, and is expected to be finalized later this year.
• First Niagara Financial Group Inc. (NASDAQ:FNFG): By the end of last trading session, the First Niagara Financial Group (NASDAQ:FNFG) shares slid 0.80% (or US$0.06) to US$8.04 with about 5.72 million shares exchanged hands for the session, compared to its average volume of 6.21 million shares. First Niagara has struggled with profitability in the wake of its rapid-fire expansion that ended with the mid-2012 acquisition of HSBC Bank USA N.A.’s Upstate New York retail branch network. First Niagara recently announced a non-cash accounting write-off of US$1.1 billion for the third quarter. Pennystocksinsiders.com found company Director, Nathaniel D. Woodson, purchased his shares at price of US$8.06 on November 18. Want to track the company insiders in First Niagara Financial Group are starting to buy or sell more company shares? See insider trade report for FNFG here.
• The Coca-Cola Co (NYSE:KO): By the end of last trading session, the Coca-Cola (NYSE:KO) shares rose 1.42% (or US$0.61) to US$43.53 with about 26.14 million shares exchanged hands for the session, compared to its average volume of 19.33 million shares. The gross profit margin for the company is rather high; currently it is at 65.60%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 17.65% is above that of the industry average.
• On Tuesday 11/18/14 , with GoPro Inc. among the advancers even after the digital-camera maker and several big shareholders filed to sell more than 10 million shares of the company’s stock.  Maintaining their recent upward trajectory, GoPro shares (GPRO) were up 4% at $84.73 after Chief Executive Officer Nick Woodman said in a filing with the Securities and Exchange Commission that he plans to sell 4.08 million shares, worth $332.4 million, in the secondary offering. Woodman and other GoPro shareholders, including funds managed by Riverwood Capital, are slated to sell a total of 9.07 million shares. GoPro itself plans on selling 1.29 million shares in an offering that would raise more than $877 million based on GoPro’s current trading price.Ambarella Inc. (AMBA), which supplies video-capturing and processing chips for GoPro cameras, was also flexing its muscle, as its shares rose more than 5% to $51.40.

  Among leading tech stocks, gains came from Apple Inc. (AAPL), Amazon.com Inc. (AMZN), Netflix Inc. (NFLX) and Google Inc. (GOOGL).

  Earnings Data

Cliffs Natural Resources (NYSE: CLF) 16.7% LOWER; announced it is pursuing exit options for its Eastern Canadian iron ore operations which may result in the closure of the Bloom Lake mine.
Leju Holdings (NYSE: LEJU) 8.4% LOWER; reported Q3 EPS of $0.23, $0.01 better than the analyst estimate of $0.22. Revenue for the quarter came in at $128.3 million versus the consensus estimate of $132.6 million.
Sunesis Pharmaceuticals (Nasdaq: SNSS) 7.3% HIGHER; announced the online publication of results from the Company’s Phase 1b/2 study of vosaroxin in combination with cytarabine in patients with relapsed or refractory acute myeloid leukemia (AML) in the November 7, 2014 Ahead of Print issue of Haematologica. The article, titled “A Phase 1b/2 study of combination vosaroxin and cytarabine in patients with relapsed or refractory acute myeloid leukemia,” is available online at http://www.haematologica.org/content/early/recent.
E-House (NYSE: EJ) 7.3% LOWER; reported Q3 EPS of $0.09, $0.10 worse than the analyst estimate of $0.19. Revenue for the quarter came in at $218.7 million versus the consensus estimate of $239 million. E-House sees FY2014 revenue of $870 – $890 million, versus prior guidance of $910 – $930 million and the consensus of $922.2 million.
Allied Nevada Gold (NYSE: ANV) 6.3% LOWER; filed to sell up to $250 million of mixed securities
Zillow, Inc. (NASDAQ: Z) 5.9% HIGHER; Caledonia’s Michael Messara said that shares could reach $770.
Agios Pharmaceuticals, Inc. (Nasdaq: AGIO) 5.8% HIGHER; announced the first reported safety and clinical activity for AG-120 from the ongoing Phase 1 dose escalation study in patients with IDH1-mutant positive advanced hematologic malignancies, including acute myeloid leukemia (AML). Agios has exclusive U.S. development and commercial rights to AG-120, a first-in-class, oral, selective, potent inhibitor of the mutant IDH1 enzyme. Daniel Pollyea, M.D., clinical investigator at the University of Colorado School of Medicine, will present the data in a late-breaking oral presentation today at the 26th Annual EORTC-NCI-AACR Symposium on Molecular Targets and Cancer Therapeutics being held in Barcelona, Spain.
Vipshop Holdings (NYSE: VIPS) 5.2% LOWER; reported Q3 EPS of $0.08, $0.01 better than the analyst estimate of $0.07. Revenue for the quarter came in at $882.6 million versus the consensus estimate of $863.12 million.
LightInTheBox Holding (NYSE: LITB) 5.1% HIGHER; reported Q3 EPS of ($0.09), in-line with the analyst estimate of ($0.09). Revenue for the quarter came in at $99 million versus the consensus estimate of $94.4 million. LightInTheBox Holding sees Q4 2014 revenue of $109 – $111 million, versus the consensus of $103.0 millionBlackBerry (Nasdaq: BBRY) 4.7% LOWER; Morgan Stanley downgraded from Equalweight to Underweight with a $7 price target.
Lowe’s Cos. (NYSE: LOW) 4.5% HIGHER; reported Q3 EPS of $0.59, $0.01 better than the analyst estimate of $0.58. Revenue for the quarter came in at $13.7 billion versus the consensus estimate of $13.55 billion. Comparable sales for the quarter increased 5.1 percent. Sees FY 14 EPS of approximately $2.68 versus the consensus of $2.63.
La-Z-Boy (NYSE: LZB) 4% HIGHER; reported Q2 EPS of $0.36, $0.02 better than the analyst estimate of $0.34. Revenue for the quarter came in at $365.6 million versus the consensus estimate of $375.7 million. La-Z-Boy declared a quarterly dividend of $0.08 per share, or $0.32 annualized. This is a 33.3% increase from the prior dividend of $0.06.
SunEdison, Inc. (NYSE: SUNE) 3.8% HIGHER; Adds to yesterday’s gains as analyst weigh in positively on First Wind deal.
Target (NYSE: TGT) 3.3% HIGHER; reported Q3 EPS of $0.54, $0.07 better than the analyst estimate of $0.47. Sales were $17.73 billion, versus the consensus of $17.56 billion.
Merrimack Pharmaceuticals, Inc. (Nasdaq: MACK) 3.2% HIGHER; announced today that the U.S. Food and Drug Administration (FDA) has granted MM-398 (nanoliposomal irinotecan injection), also known as ”nal-IRI,” Fast Track designation for the treatment of patients with metastatic adenocarcinoma of the pancreas who have been previously treated with gemcitabine-based therapy. Fast Track is designed by the FDA to facilitate and expedite the development and review of drugs that treat serious conditions and fill an unmet medical need.
Jack in the Box (Nasdaq: JACK) 3.1% HIGHER; reported Q4 EPS of $0.54, $0.01 better than the analyst estimate of $0.53. Revenue for the quarter came in at $344.7 million versus the consensus estimate of $342.3 million. Jack in the Box company same-store sales increased 3.1 percent. Qdoba s same-store sales in the fourth quarter increased 7.1 percent. Jack in the Box sees FY2015 EPS of $2.73 – $2.88, versus the consensus of $2.81. Same-store sales are expected to increase approximately 1.5 to 2.5 percent at Jack in the Box company restaurants. Same-store sales are expected to increase approximately 6.0 to 8.0 percent at Qdoba company restaurants.
Tesla Motors, Inc. (NASDAQ: TSLA) 2.9% LOWER; Morgan Stanley slashes estimates given Model X delay
Staples (NASDAQ: SPLS) 2.7% HIGHER; reported Q3 EPS of $0.37, $0.01 better than the analyst estimate of $0.36. Revenue for the quarter came in at $5.96 billion versus the consensus estimate of $5.93 billion. Comps fell 4 percent. Staples sees Q4 2014 EPS of $0.27-$0.32, versus the consensus of $0.31PetSmart (NASDAQ: PETM) 2.2% HIGHER; reported Q3 EPS of $1.02, $0.08 better than the analyst estimate of $0.94. Revenue for the quarter came in at $1.7 billion versus the consensus estimate of $1.73 billion. Comps were flat. PetSmart sees Q4 2014 EPS of $1.34-$1.38, versus the consensus of $1.37. It sees comparable store sales growth slightly positive. Also, reports from Reuters KKR and CD&R are preparing a joint bid.
Cloud Peak Energy Inc. (NYSE: CLD) 1.7% LOWER; commenced a registered underwritten public offering of its Series A mandatory convertible preferred stock consisting of 100,000 shares with a liquidation preference of $1,000 per share.
Popeyes Louisiana Kitchen, Inc. (NASDAQ: PLKI) 1.6% HIGHER; In a 13D filing on Popeyes Louisiana Kitchen (NASDAQ: PLKI), hedge fund Red Mountain Capital disclosed a 5.1%, or 1,180,000 share, stake in the company.

Tesla Motors (TSLA) down $10.51 to $247.10 after Morgan Stanley took down estimates for the company, though they noted they remain buyers. November call option implied volatility is at 45, December is at 35, January is at 37; compared to its 26-week average of 46.

Staples (SPLS) is recently up $1 to $13.79 after results and sees closing up to 225 North American stores by end 2015. November call option implied volatility is at 48 December is at 29, January is at 25; compared to its 26-week average of 33

Blackberry (BBRY) recently down 56c to $10.21 after Morgan Stanley downgraded BlackBerry to Underweight from Equal Weight. The firm believes the market is too optimistic on new product ramps and in assuming the company will meet its FY16 $350M target in new software revenue. November call option implied volatility is at 67, December is at 65; compared to its 26-week average of 56.