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| July 2008 |
| Archives |
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| Thursday, July 31, 2008, 4:07 PM — by Rob DeFrancesco, TechStock Radar |
| Concur Roars Back |
Concur Technologies (CNQR, $41.22) worked its way back from today’s low of $37.58. If AmEx thinks Concur is worth at least $39.27 a share, isn’t it? Deutsche Bank actually thinks Concur is worth a lot more, and raised its target price to $52 from $43. For more on Concur, see TechStock Radar—July 30, 2008.
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| Thursday, July 31, 2008, 1:27 PM — by Rob DeFrancesco, TechStock Radar |
| Myriad Genetics Adds to Gains |
Myriad Genetics (MYGN, $65.44) adds to recent gains, hitting a new 52-week high this morning at $65.95. The RSI is flashing a negative divergence, indicating increased odds of a short-term pullback after the 44% rise in the shares since the end of June. For more on Myriad, see TechStock Radar—July 30, 2008.
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| Thursday, July 31, 2008, 10:19 AM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion Powers Up |
Research in Motion (RIMM, $123.18) shares are flirting with important short-term resistance levels. After laying out the latest risk/reward parameters in Rob’s Journal on July 17, I wrote the following day that RIM shares looked to have put in a low on July 15 at $101.86. I also said the iPhone buzz was quieting and that RIM would go back into the spotlight with the upcoming debut of the BlackBerry Bold. The successful test of the $101.86 level on July 16 in the face of the Needham downgrade (the analyst gave RIM a fair value of $87) was a positive sign for the stock. For the latest trading outlook on RIM, Tech-Stock Prospector subscribers should see today’s Rob’s Journal. Also, see TechStock Radar—July 16, 2008.
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| Thursday, July 31, 2008, 9:07 AM — by Rob DeFrancesco, TechStock Radar |
| Google Headed Lower? |
Google (GOOG, $477 pre market) shares look like they’re ready to make a significant move in either direction, and the bias is to the downside. The stock is forming a wedge on the chart from the July 22 low of $465.60. On a fundamental basis, there’s downside risk to $442. Google needs to close above $492 to turn the short-term bias to the upside. For more on Google, see TechStock Radar—July 18, 2008.
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| Thursday, July 31, 2008, 8:08 AM — by Rob DeFrancesco, TechStock Radar |
| Apple Gets Small |
Apple (AAPL, $159.88) would be crazy not to launch a 12-inch MacBook Pro and a 9-inch MacBook Touch. According to one of my Apple Retail sources, ‘Every fourth person comes into the store looking for the old 12-inch PowerBook.’ The laptop almost has a cult following. It looks like the demand will be filled soon enough.
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| Wednesday, July 30, 2008, 6:36 PM — by Rob DeFrancesco, TechStock Radar |
| Concur Raises FY '08 Guidance |
Concur Technologies (CNQR, $41.59) reports fiscal Q3 (June) EPS of 19 cents, seven cents above the consensus estimate, on revenue of $54.9 million, vs. the consensus of $53.5 million. For fiscal ‘08 ending September, Concur sees revenue of $214 million, above the consensus of $211.9 million. While this guidance is good, it’s not of the blowout variety. For more on Concur, see TechStock Radar—July 29, 2008.
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| Wednesday, July 30, 2008, 3:24 PM — by Rob DeFrancesco, TechStock Radar |
| Greenfield Online Drifts Down |
Greenfield Online (SRVY, $14.25) shares are now trading 8.1% below the Quadrangle Group proposed takeover price of $15.50. After the initial pop to $15.35 on the deal announcement in the middle of June, Greenfield Online shares have drifted lower, maybe because of concerns about a slowdown in the overall comparison-shopping business. For more on Greenfield Online, see TechStock Radar—July 27, 2008.
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| Wednesday, July 30, 2008, 1:20 PM — by Rob DeFrancesco, TechStock Radar |
| VeriSign Attempts to Hold Support |
VeriSign (VRSN, $33.25) shares are trying to hold support in the $32.60 to $32.70 range following the sharp pullback earlier this month on news of the sudden departure of CEO William Roper. VeriSign reports Q2 results a week from today (August 6). At the time of the Roper announcement, VeriSign said Q2 revenue was on track to meet or beat the consensus estimate of $231.39 million, but didn’t mention anything about the EPS estimate of 23 cents. Ahead of the release, investors remain skittish because of the shroud of mystery surrounding Roper’s exit. For more on VeriSign, see TechStock Radar—July 3, 2008.
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| Wednesday, July 30, 2008, 11:36 AM — by Rob DeFrancesco, TechStock Radar |
| VeriFone: Barclays Global Ups Stake |
In Q2, Barclays Global added to its position in VeriFone Holdings (PAY, $15.30), picking up 923,735 shares, an increase of 58%. The firm now owns 2.525 million shares. In Q2, VeriFone traded as low as $10.10 (on April 29) and as high as $16.99 at the start of the quarter. For more on VeriFone, see TechStock Radar—July 28, 2008.
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| Wednesday, July 30, 2008, 8:34 AM — by Rob DeFrancesco, TechStock Radar |
| Myriad Genetics: Spin-Off Chatter Gets Louder |
RBC Capital upgrades Myriad Genetics (MYGN, $62.51) to ‘Outperform’ with a price target of $72 based on strong growth in the core diagnostics unit and a potential spin-off of the drug business. UBS says there’s a 70% chance of a spin-off. Myriad also is an attractive takeover target for one of the big lab companies. For more on Myriad, see TechStock Radar—July 26, 2008.
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| Wednesday, July 30, 2008, 7:09 AM — by Rob DeFrancesco, TechStock Radar |
| Take-Two Interactive: EA Needs to Seal the Deal |
On the Electronic Arts (ERTS) earnings conference call last night, management wouldn’t comment about the outstanding takeover offer for Take-Two Interactive (TTWO, $24.00). With the FTC set to approve the transaction sometime in August, EA could be readying a slightly higher bid (the current offer stands at $25.74) that’s closer to the recent Take-Two high of $27.95. EA has the financial ability to raise the offer to $27 or $28 a share. It’s time for EA to seal the deal and lock in the growth that it requires. For more on Take-Two Interactive, which claims to be talking to other parties, see TechStock Radar—July 17, 2008.
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| Tuesday, July 29, 2008, 9:14 PM — by Rob DeFrancesco, TechStock Radar |
| Concur Pops 14% |
Concur Technologies (CNQR, $41.20) finished up more than 14% today, closing above $39.27 a share, the price at which American Express made its 13% investment. Traders are betting Concur will provide strong fiscal Q3 (June) numbers and Q4 guidance when it releases results tomorrow. Concur shares did close well off the opening high of $46.38. Who was so euphoric and bought at that level?!
Next Century Growth Investors—a Minneapolis-based firm with $2.2 billion in long equity assets—was the #2 investor in Concur at the end of Q1, with holdings of 2.349 million shares. Next Century Growth, which added 383,742 shares in Q1, counted Concur among its five largest positions at the end of March. For more on Concur and the AmEx deal, see the TechStock Radar update from this morning.
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| Tuesday, July 29, 2008, 4:12 PM — by Rob DeFrancesco, TechStock Radar |
| Juniper Networks Pays Up for New CEO |
It pays (quite well) to be at the top at Juniper Networks (JNPR, $25.46). On September 8, Kevin Johnson joins Juniper as CEO from Microsoft, where he was president of the Platforms and Services division. To start, Johnson gets a $5-million hiring bonus (paid in three annual increments, with $1.5 million in the first year of service). Then there’s the annual base salary of $800,000, supplemented by a bonus based on 150% of his base salary, which for 2008 will be prorated through the remainder of the year. Throw in the initial stock options covering 1.6 million shares and additional performance-based options covering 335,000 shares. And don’t forget the relocation assistance of up to $500,000 for new-home expenses. Johnson better be ready to perform some magic, and get the Juniper share price back to its 52-week high of $37.95.
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| Tuesday, July 29, 2008, 2:31 PM — by Rob DeFrancesco, TechStock Radar |
| MetroPCS: Barclays Global Adds Shares |
Shares of wireless provider MetroPCS (PCS, $16.27) have moved to the top of their recent range after dipping below $15 earlier this month. In Q2, Barclays Global increased its position by 56% with the purchase of 2.369 million shares. The firm now owns 6.588 million shares. During the June quarter, MetroPCS traded between $16.75 and $21.86 a share. For more on MetroPCS, see TechStock Radar—July 11, 2008.
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| Tuesday, July 29, 2008, 2:02 PM — by Rob DeFrancesco, TechStock Radar |
| BigBand Networks Bounces Ahead of Results |
After dropping 8.1% yesterday, BigBand Networks (BBND, $4.20) shares are rebounding 8.5% this afternoon on light volume. The provider of video-networking platforms reports Q2 results on Thursday. For Q2, the consensus calls for a loss of one cent a share on revenue of $42.15 million. But it’s the Q3 consensus revenue estimate of $47.14 million, representing sequential growth of 11.8%, which could provide quite a challenge. For more on BigBand, see TechStock Radar—July 9, 2008.
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| Tuesday, July 29, 2008, 11:46 AM — by Rob DeFrancesco, TechStock Radar |
| Edwards Lifesciences: Granahan Ups Stake by 159% |
In Q2, Granahan Investment Management—$3.46 billion in long equity assets—increased its position in Edwards Lifesciences (EW, $61.92) by 159% with the purchase of 502,250 shares. Granahan now owns 817,868 shares and counts Edwards among its five largest holdings. During the June quarter, Edwards shares traded between $63.49 and $44.80. The stock, up 35% YTD, hit a new 52-week high of $66.54 on July 18.
Edwards, a specialist in heart valves and related cardiovascular products, last week lifted 2008 EPS guidance to $2.50 to $2.58, an increase of five cents. For the full year, the company sees revenue of $1.24 billion to $1.28 billion. In Q2, heart-valve therapy revenue rose 24% to $162.6 million, while critical-care revenue (catheters, sensors and monitors) advanced 20% to $116.6 million.
The 2008 consensus EPS estimate of $2.54 indicates expected growth of 19%. Edwards trades at 21 times the 2009 EPS estimate of $2.95.
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| Tuesday, July 29, 2008, 9:22 AM — by Rob DeFrancesco, TechStock Radar |
| Concur Surges on American Express Deal |
American Express has taken a 13% equity stake in Concur Technologies (CNQR, $41.15 pre market, +14%), a provider of on-demand travel & expense management solutions. American Express purchased 6.4 million shares at $39.27 a share for $251 million in cash. Plus, AXP has the right to purchase an additional 1.28 million shares of Concur at any time over the next two years at $39.27 a share. A standstill agreement limits American Express’ stake to 15.2% (representing the additional warrant) and Concur management says the objective of this relationship is not an eventual acquisition by American Express. AXP vice chairman Ed Gilligan joins Concur’s board of directors.
The basis for the investment is Concur’s newly formed marketing alliance with American Express in which Concur will exclusively promote American Express’ Corporate Cards to its 7,000+ clients and AXP’s Global Commercial Card business will exclusively promote the Concur Expense solution to its corporate clients.
Concur was originally profiled in Tech-Stock Prospector (TSP) in July 2007 when the stock was trading around $23. In January, we said Concur was most attractive for new money below $30 a share. The stock fell to $25.52 on March 10 and dipped to $28.26 as recently as July 15. For more on Concur, TSP subscribers should see ‘Letter from Rob,’ TSP #85—January 2008.
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| Tuesday, July 29, 2008, 8:34 AM — by Rob DeFrancesco, TechStock Radar |
| Zoran: Nice Call By Jefferies |
Jefferies advised clients to sell Zoran (ZRAN, $7.90 pre market) on July 10 when the stock was trading around $10 a share. At the time, the firm said channel checks indicated Zoran had lost two material converter-box designs, which would hurt 2H revenue. The stock is down 17% in pre-market activity following last night’s Q3 guidance that fell well short of expectations. Today, Jefferies lowers its price target to $7 from $8.50 and maintains a rating of ‘Underperform.’ For more on Zoran, see TechStock Radar—July 28, 2008.
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| Tuesday, July 29, 2008, 8:13 AM — by Rob DeFrancesco, TechStock Radar |
| Netflix Perks Up |
Netflix (NFLX, $28.63) managed a 2.8% gain yesterday even as the whole tech sector was getting sold off. Following last week’s raised guidance, the stock closed at its highest level since June 26 and above the 200-day moving average of $28.54. The next level of interest on the upside is $29.05. The 50-day moving average is trending down from $29.62. The 2008 consensus EPS estimate is up three cents to $1.26 since last week. For more on Netflix, see TechStock Radar—July 25, 2008.
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| Monday, July 28, 2008, 5:45 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Pulls Back |
Apple (AAPL, $154.40) finished down 4.7% today on below-average volume of 27.8 million shares after failing to hold above the 200-day moving average of $164.73 last week (see TechStock Radar—July 23, 2008). For the latest trading outlook for Apple, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Monday, July 28, 2008, 4:41 PM — by Rob DeFrancesco, TechStock Radar |
| Zoran Off 13% on Weak Guidance |
Zoran (ZRAN, $8.35 after hours), a provider of digital-video chips, sees Q3 EPS of two cents to four cents, well below the consensus of 29 cents, on revenue of $123 million to $128 million, vs. the consensus of $154.1 million. After falling 3.5% in the regular session, Zoran shares are down 13% after hours.
In Q2, the company saw a bigger-than-expected decline in its DVD business (15% of revenue) and management says this unit won’t offer the same seasonal revenue growth experienced in past years. Plus, Zoran sees increasingly cautious order patterns from customers in the digital-camera sector, which represents 33% of total revenue. Brookside Capital won’t be happy with this news (see TechStock Radar—July 21, 2008).
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| Monday, July 28, 2008, 3:35 PM — by Rob DeFrancesco, TechStock Radar |
| Seagate Technology Stabilizes |
Seagate Technology (STX, $15.01) is attempting to stabilize after the big drop, with last week’s low of $14.35 holding the July 16 low of $14.27. The fiscal 2009 (June) consensus EPS estimate has been reset to $1.76 from $2.53. For more on Seagate, see TechStock Radar—July 21, 2008.
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| Monday, July 28, 2008, 1:22 PM — by Rob DeFrancesco, TechStock Radar |
| VeriFone Pops 13% on Restatement News |
VeriFone Holdings (PAY, $15.45) is up 13% today after the company finally announces that restated earnings for the past six quarters would be released on August 19. The fiscal 2008 (October) consensus EPS estimate has dropped to $1.04 from $1.59 in early January. VeriFone shares traded as high as $50 last October before sinking to $10.10 at the end of April. In Q1, Capital Research Global Investors and Capital Guardian Trust added shares of VeriFone, while Brookside Capital increased its position by 34% with the purchase of 1.2 million shares.
For more on VeriFone, see TechStock Radar—January 14, 2008 and December 10, 2007.
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| Monday, July 28, 2008, 12:56 PM — by Rob DeFrancesco, TechStock Radar |
| Allergan: Betting on Botox |
Shares of Allergan (AGN, $52.56), a provider of specialty pharmaceuticals and medical products, are down 25% from the January high of $70.40. The company is best known for Botox, which provides about 30% of total revenue. In Q1, Botox sales rose 18% to $315.5 million. Allergan is trying to find similar success with its new dermal filler Juvederm and Lap-Band, an alternative to gastric bypass surgery. The concern is that a slowdown in the economy will make people think twice about cosmetic surgery. Allergan reports Q2 results on Wednesday. The 2008 consensus EPS estimate of $2.58 indicates expected growth of 18%.
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| Monday, July 28, 2008, 12:07 PM — by Rob DeFrancesco, TechStock Radar |
| Myriad Genetics Hits New 52-Week High |
Myriad Genetics (MYGN, $64.02) rose to a new 52-week high of $65.00 this morning before succumbing to profit taking. On Friday, the stock jumped 6.5% on above-average volume of 2.01 million shares. For more on Myriad, see TechStock Radar—July 26, 2008.
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| Monday, July 28, 2008, 9:02 AM — by Rob DeFrancesco, TechStock Radar |
| Verizon Wireless Q2 Data Revenue +45% |
Verizon Wireless (VZ, $34.45) saw Q2 data-revenue growth of 45.3%. Data revenue of nearly $2.6 billion accounted for 21.5% of total wireless revenue, up from 19.7% in Q1. The company had 49.6 million retail data customers in June (about 75% of its retail customer base), up 25.6% over the same period last year. More than 60% of Verizon Wireless retail customers had 3G devices at the end of the quarter.
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| Monday, July 28, 2008, 8:16 AM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com: Thomas Weisel Sees $145 |
Thomas Weisel upgrades Priceline.com (PCLN, $100.53) to ‘Overweight’ with a price target of $145 based on a pickup in the U.S. business. The firm thinks Priceline.com could beat Q2 estimates (EPS of $1.40 on revenue of $492.6 million) when it reports results on August 5. Priceline.com shares are well off the May high of $144.34 on concerns about an overall slowdown in the travel sector because of the economy. But the argument could be made that consumers turn more to the Web when times are tough in order to get better deals, with Priceline.com being one of the main beneficiaries. For more on Priceline.com, see TechStock Radar—July 21, 2008.
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| Sunday, July 27, 2008, 9:21 PM — by Rob DeFrancesco, TechStock Radar |
| Apple iPhone Availability Improves |
The iPhone is back in stock at most Apple Retail Stores on the east coast. In New York, only two of the state’s 13 stores are sold out of the 16 GB white handset and just one store is out of the 8 GB. The 16 GB black is sold out in four New York locations. All of the 14 stores in Florida have the 16 GB white in stock, while just three are sold out of the 16 GB black. Of the 10 stores in New Jersey, 80% have the 8 GB and 16 GB handsets in stock. The six stores in Virginia are fully stocked when it comes the 16 GB white, while two are sold out of the 16 GB black. You’re in luck if you want an iPhone in Maryland as all of the state’s five stores are fully stocked, with the exception of the Annapolis location being sold out of the 16 GB black.
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| Sunday, July 27, 2008, 10:52 AM — by Rob DeFrancesco, TechStock Radar |
| Greenfield Online Deal Update |
The preliminary proxy statement filed by Greenfield Online (SRVY, $14.53) related to its planned acquisition by Quadrangle Group at $15.50 a share in cash reveals the company received a takeover offer of $16.50 a share in April 2007. That offer, by an unnamed party, was subsequently withdrawn. The talks with Quadrangle Group heated up late last year after Daniel Rosensweig, former COO of Yahoo, became a partner of the private-equity firm.
Following the announcement of the merger agreement with Quadrangle in the middle of June, Greenfield Online started the ‘go-shop’ process, actively soliciting parties that might be interested in and capable of submitting a proposal to acquire the company at a higher price than the Quadrangle offer. Through July 16, Greenfield Online had opened up its books to 11 potentially interested parties after its investment banker contacted a total of 54 parties, including 24 strategic buyers and 30 financial buyers. As part of the agreement with Quadrangle, the ‘go-shop’ process ends August 4.
For more on Greenfield Online, see TechStock Radar—July 23, 2008.
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| Saturday, July 26, 2008, 5:25 PM — by Rob DeFrancesco, TechStock Radar |
| Myriad Genetics +44% From June Low |
In Q1, Miura Global Management—a New York City-based money manager with $1.46 billion in long equity assets—opened a position in Genentech (DNA, $96.00) of 650,000 shares. Genentech, which traded between $66.10 and $82.20 in the March quarter, surged 17% last week on Roche’s buyout offer.
Miura Global’s other big biotech bet in Q1 was Myriad Genetics (MYGN, $64.00); the firm initiated a position of 900,000 shares. Myriad traded between $34.35 and $49.74 in the March quarter. Myriad shares were knocked down at the end of June after the company said it would discontinue the development of Flurizan for Alzheimer’s disease because the compound was shown to be ineffective. But after dipping to $44.55 on June 30, Myriad shares have jumped 44%.
While Myriad is in clinical trials with two drugs to treat non-small-cell lung cancer, melanoma and HIV, it’s the company’s molecular-diagnostics unit that accounts for about 95% of its revenue. In fiscal Q3 (ended March), molecular-diagnostics revenue rose 55% to $59 million. Myriad discovered the BRCA1 and BRCA2 genes that cause hereditary breast and ovarian cancer, and now offers clinical tests to determine predisposition. The company also has tests for hereditary colon cancer, pancreatic cancer and melanoma. For fiscal 2008 (ended June), total revenue is expected to have advanced 49% to $234.1 million. Analysts look for revenue to hit $319.3 million in FY’09. The company reports fiscal Q4 results on August 19.
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| Saturday, July 26, 2008, 9:54 AM — by Rob DeFrancesco, TechStock Radar |
| Broadwind Energy: Wind Power Darling |
Wind energy is all the rage these days. Investors are searching for ways to play the expected growth. They found Broadwind Energy (BWEN.OB, $19.73), a provider of wind-energy infrastructure products and services. The stock has gained 38% YTD, and was up as much as 103% at the June 3 high of $29.00. A year ago, Broadwind traded at $5 a share.
Broadwind is the former Tower Tech Holdings; the name change took place in March. CEO Cameron Drecoll came to Broadwind in 2007 when his company, Brad Foote Gear Works, was acquired by Tower Tech. Broadwind owns companies involved in wind-tower manufacturing, heavy-steel fabrication, wind-facility construction and specialized transportation services. In early June, Broadwind purchased Badger Transport, a heavy hauler specializing in transporting oversized components for the wind-energy industry.
The risk for the stock over the near term is that hedge fund Tontine Capital, run by Jeffrey Gendell, owns 47 million shares, representing 49% of the outstanding shares. Tontine, an early investor in Tower Tech, would pressure the stock as it locks in some profits. Broadwind trades less than 300,000 shares a day. At the end of June, the company increased the authorized number of common shares to 150 million from 100 million.
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| Friday, July 25, 2008, 5:16 PM — by Rob DeFrancesco, TechStock Radar |
| Qualcomm: New Price Target |
In Rob’s Journal on July 12, I said any positive resolution of the dispute with Nokia over royalty payments would juice shares of Qualcomm (QCOM, $54.45), which were trading around $48.33 at the time. After Qualcomm popped 17% yesterday on news of the settlement with Nokia, the stock added 3.9% today. For the latest price target on Qualcomm, Tech-Stock Prospector subscribers should see today's Rob's Journal.
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| Friday, July 25, 2008, 3:31 PM — by Rob DeFrancesco, TechStock Radar |
| eBay Trading Update |
eBay (EBAY, $25.33) shares are still trying to claw their way back from last week’s low of $23.52 and perhaps fill the gap on the price chart at $26.74 following the Q2 earnings disappointment. For more on eBay, see TechStock Radar—July 23, 2008.
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| Friday, July 25, 2008, 2:01 PM — by Rob DeFrancesco, TechStock Radar |
| The Knot Rebounds 20% |
The Knot (KNOT, $9.10) shares have rallied 20% from the July 15 low of $7.60. The stock now trades at 40 times the 2008 consensus EPS estimate of 23 cents and 21 times the 2009 estimate of 43 cents. Wellington recently took a significant position in the operator of wedding-related websites. For more on The Knot, see TechStock Radar—July 11, 2008. |
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| Friday, July 25, 2008, 10:47 AM — by Rob DeFrancesco, TechStock Radar |
| Apple Could Lose #3 Spot to Acer in U.S. PC Market |
According to Digitimes, Apple (AAPL, $160.29) faces intensified competition in the U.S. PC market when Acer debuts its Aspire One XP netbook in August. The article says Acer could retake the #3 spot in the U.S. from Apple, which held an 8.5% share in Q2, according to Gartner. Acer was #4 with an 8.1% share. It wouldn’t be good PR for Apple to fall to Acer, which is probably a main reason why Apple is about to launch its own lower-priced laptop to drive market share.
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| Friday, July 25, 2008, 8:44 AM — by Rob DeFrancesco, TechStock Radar |
| Google: Soleil Sees $580 |
Soleil raises Google (GOOG, $475.62) to ‘Buy’ with a price target of $580 based on valuation. The stock trades at 24 times the consensus 2008 EPS estimate of $19.71 and 19.7 times the 2009 estimate of $24.19, vs. the two-year average EPS growth-rate estimate of 24.6%.
The Radar fair value for Google is $588, with downside risk to $442. For more, see TechStock Radar—July 18, 2008.
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| Friday, July 25, 2008, 8:27 AM — by Rob DeFrancesco, TechStock Radar |
| Netflix Raises Guidance |
Netflix (NFLX, $29.60 pre market) shares are up 11% pre market after the company raises its EPS guidance. The company maintains its 2008 subscriber guidance of 9.1 million to 9.7 million. Netflix ended Q2 with 8.41 million subscribers (+25% year over year), in line with the consensus estimate. Per-share earnings of 42 cents beat the consensus by two cents and revenue of $337.6 million (+11.2%) matched the consensus. Churn rose to 4.2% in Q2 from 3.9% in Q1. For 2008, the company sees EPS of $1.19 to $1.31, vs. previous guidance of $1.16 to $1.29. The new midpoint of $1.25 is above the consensus estimate of $1.23. Netflix shares had fallen 35% from the April 18 high of $40.90 on concerns about losing subscribers because of the weakening economy.
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| Thursday, July 24, 2008, 6:43 PM — by Rob DeFrancesco, TechStock Radar |
| NETGEAR Rebounds |
NETGEAR (NTGR, $15.37) shares rallied 1.9% today after the company reported Q2 EPS of 41 cents, six cents above the consensus. Revenue of $204.5 million (+24%) topped the consensus of $196 million. Gross margin of 33.2% improved from Q1’s 32.9%. For Q3, the company sees revenue of $208 million to $212 million, below the consensus of $213.8 million. For more on NETGEAR, see TechStock Radar—July 21 & July 7, 2008.
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| Thursday, July 24, 2008, 4:19 PM — by Rob DeFrancesco, TechStock Radar |
| IBM Hits New 52-Week High |
IBM (IBM, $130.00) dodged today’s sharp downdraft and finished with a small gain after hitting a 52-week high at $130.93 earlier in the sessions. Over the past week, the 2008 consensus EPS estimate has risen to $8.82 from $8.56 and the 2009 estimate has advanced to $9.84 from $9.59. For my IBM fair-value analysis, see TechStock Radar—July 20, 2008.
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| Thursday, July 24, 2008, 1:05 PM — by Rob DeFrancesco, TechStock Radar |
| Amazon.com Pops 15% |
Amazon.com (AMZN, $81.13) shares are up 15% following the Q2 results. Positives for the quarter:
*Sales in North America +35%
*International sales excluding FX gains +34% (represented 47% of total sales)
*Worldwide Media sales +31%
*Revenue per active customer +20%
Amazon.com is back above its 200-day moving average of $79.34, but faces substantial resistance at the triple top from May/June in the $84.50 to $84.75 range.
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| Thursday, July 24, 2008, 10:03 AM — by Rob DeFrancesco, TechStock Radar |
| GSI Commerce Jumps 16% |
GSI Commerce (GSIC, $14.30) shares are up 16% this morning following strong Q2 revenue results and Q3 guidance. The company sees revenue for the September quarter coming in at $188 million to $193 million, vs. the consensus of $188.1 million.
In Q2, revenue of $193.2 million topped the consensus of $181.5 million. GSI Commerce launched five new Web stores since the middle of April, including sites for Quiksilver and Kenneth Cole. The company also signed two new e-commerce agreements (with a regional department store and a national retailer of women’s apparel) involving a transition of an existing e-commerce business to the GSI platform.
Stifel today upgrades GSI Commerce to ‘Buy’ with a price target of $17. JMP Securities started coverage with an ‘Outperform’ rating at the end of June. See TechStock Radar—June 27, 2008.
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| Thursday, July 24, 2008, 8:13 AM — by Rob DeFrancesco, TechStock Radar |
| Qualcomm & Nokia Settle Dispute |
Qualcomm (QCOM, $53.46 pre market) settles its licensing dispute with Nokia. The exact royalty terms were not disclosed (a 'substantial' initial payment to Qualcomm is included in the transaction), but the licensing agreement spans 15 years and covers 4G technology. For fiscal 2009, Qualcomm expects the settlement to add between 20 cents and 28 cents to EPS, including royalties and lower legal expenses. For fiscal 2008 (September), Qualcomm sees EPS of $2.11 to $2.13, up from previous guidance of $2.04 to $2.09. The consensus estimate is $2.15. |
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| Wednesday, July 23, 2008, 6:19 PM — by Rob DeFrancesco, TechStock Radar |
| Greenfield Online: Pennant Capital Ups Stake to 9.95% |
In an SEC filing after the close, Pennant Capital Management discloses that it has raised its stake in Greenfield Online (SRVY, $14.72) to 9.95%. The firm now owns 2.62 million shares, up from 2.036 million shares held at the end of June. Over the past three trading sessions, Pennant purchased 407,100 shares, including 183,100 shares picked up today at $14.71.
In the middle of June, Greenfield Online agreed to be taken private for $15.50 a share by Quadrangle Group. Pennant Capital thinks the buyout valuation is too low. For more, see TechStock Radar—June 30, 2008.
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| Wednesday, July 23, 2008, 5:08 PM — by Rob DeFrancesco, TechStock Radar |
| Qualcomm Delays Earnings Report |
Qualcomm (QCOM, $44.82 after hours) postponed its fiscal Q3 earnings report until 8 AM ET tomorrow. The company was scheduled to report results after the close. The stock is trading at $49.21 after hours on speculation that Qualcomm has reached a settlement with Nokia involving licensing fees. In a fun twist, a technology problem involving a Webcast feed was said to have delayed the start of the Nokia/Qualcomm trial scheduled to begin this morning in Delaware until tomorrow as well. Investors are putting two and two together and coming up with something bullish for Qualcomm.
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| Wednesday, July 23, 2008, 4:25 PM — by Rob DeFrancesco, TechStock Radar |
| Amazon.com: Q3 Guidance Good Enough? |
Amazon.com (AMZN, $70.35 after hours) shares are flat in after-hours trading following Q3 revenue guidance of $4.2 billion to $4.43 billion. The midpoint of $4.315 billion is comfortably above the consensus of $4.23 billion. For the full year, Amazon.com sees revenue of $19.35 billion to $20.1 billion, with the midpoint of $19.725 billion above the consensus of $19.6 billion.
UPDATED 6:24 PM ET--The stock is now trading at $76.25 after hours.
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| Wednesday, July 23, 2008, 3:46 PM — by Rob DeFrancesco, TechStock Radar |
| Amazon.com Q2 Results on Deck |
Amazon.com (AMZN, $70.10) shares are steady ahead of Q2 results after the close. While the company should meet the consensus estimates for June (EPS of 26 cents on revenue of $3.96 billion), it’s the September outlook that’s most important. The market is looking for $4.23 billion in Q3 revenue, representing sequential growth of 6.8%. For more on Amazon.com, see TechStock Radar—July 18, 2008.
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| Wednesday, July 23, 2008, 12:19 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Rally Fades |
Apple (AAPL, $164.41) rallied 15% from yesterday’s low of $146.53 to this morning’s high of $168.37. But is the rebound sustainable given the weak gross-margin guidance for fiscal 2009? Even putting Jobs’ health concerns aside, Apple shares are subject to continued multiple contraction. For a full update, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Wednesday, July 23, 2008, 10:10 AM — by Rob DeFrancesco, TechStock Radar |
| eBay Trading Update |
It must be a jolly market this morning because even eBay (EBAY, $25.55) is rallying. The stock needs to fill the price gap on the chart from last week at $26.74. Last week I talked about the downside risk to $20.65. Applying a P/E of 14 (1x growth rate) to the 2009 consensus EPS estimate of $1.96 results in an upside fair value of $27.45. For more on eBay, see TechStock Radar—July 17, 2008.
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| Wednesday, July 23, 2008, 8:11 AM — by Rob DeFrancesco, TechStock Radar |
| Intuitive Surgical Jumps on Raised Guidance |
Intuitive Surgical (ISRG, $308 pre market) shares are up 10% in the pre market after the company reported Q2 EPS of $1.28, 10 cents better than the consensus, on revenue of $219.2 million (+56.3), vs. the consensus of $208.6 million. The company sold 85 daVinci Surgical Systems (up from 74 in the March quarter), with growth driven by greater-than-expected adoption rates for emerging procedures. For 2008, ISRG sees revenue growth of 45% to 47%, above previous guidance of 42%. The upper end of this growth range equates to $883.2 million, vs. the consensus of $873.5 million.
For more on ISRG, see TechStock Radar—July 20,2008.
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| Tuesday, July 22, 2008, 4:24 PM — by Rob DeFrancesco, TechStock Radar |
| VMware: New Revenue Growth Target |
VMware (VMW, $33.15 after hours) reports Q2 EPS of 23 cents, in line with the consensus, on revenue of $456 million (+54%), slightly above the consensus of $458.6 million. For Q3, the company sees revenue of $462 million to $468 million, vs. the consensus of $497.3 million. The new revenue-growth target range is 42% to 45%, vs. the consensus of 47%. The stock is taking a hit in after-hours activity.
Earlier this month, I calculated initial downside risk to $32.70 based on revenue growth of 45%. See TechStock Radar—July 8, 2008.
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| Tuesday, July 22, 2008, 2:12 PM — by Rob DeFrancesco, TechStock Radar |
| Apple MacBook Touch? |
The rumors and Photoshopped images are flying around like crazy. For what it's worth, check out this Gizmodo article.
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| Tuesday, July 22, 2008, 12:01 PM — by Rob DeFrancesco, TechStock Radar |
| Google Trading Update |
With the recent sharp pullback, Google (GOOG, $472.35) shares nearly filled the gap on the price chart at $459.37 from April 18. Today's low (so far) is $465.60. Meanwhile, another gap was created last week all the way back at $524.50. The 2008 consensus EPS estimate has been cut to $19.72 from $20.14 and the 2009 estimate trimmed to $24.20 from $24.77. For the latest Google risk/reward analysis, see TechStock Radar—July 18, 2008.
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| Tuesday, July 22, 2008, 9:55 AM — by Rob DeFrancesco, TechStock Radar |
| Genzyme Adds to Recent Gains |
Genzyme (GENZ, $80.51) this morning took out yesterday's high of $80 on active volume. The next level of interest is the 52-week high of $82.08. For more on Genzyme, see TechStock Radar—July 15, 2008.
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| Tuesday, July 22, 2008, 8:26 AM — by Rob DeFrancesco, TechStock Radar |
| SanDisk: ThinkPanmure Sees $10 |
SanDisk (SNDK, $15.20 pre market) is trading below its 52-week low in pre-market activity after slashing Q3 revenue guidance to $750 million to $850 million, well below the consensus of $1.09 billion. Revenue in Q2 lagged the consensus by 10%. The pricing outlook for NAND flash is far worse than management previously expected.
Last Friday’s bullish call by Caris suddenly doesn’t look so smart. See TechStock Radar—July 18, 2008.
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| Tuesday, July 22, 2008, 7:03 AM — by Rob DeFrancesco, TechStock Radar |
| Foundry Networks: Nice Call By Stifel |
Stifel made a nice call on July 10 when the firm started coverage of Foundry Networks (FDRY, $18.95 pre market) with a ‘Buy’ rating and price target of $16 when the stock was trading around $11.15. Brocade announced last night its intention to acquire Foundry for $19.25 a share in a $3-billion deal. Brocade and Foundry are trying to survive against Cisco in the Fibre Channel and Ethernet switching segments. The acquisition makes sense and the two companies are stronger together, but the fight with Cisco is a tough slog. For more on Foundry, see TechStock Radar—July 10, 2008.
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| Monday, July 21, 2008, 5:47 PM — by Rob DeFrancesco, TechStock Radar |
| Apple: Steve's Health is a 'Private Matter' |
The Apple (AAPL, $148.68 after hours) conference call took a macabre turn when an analyst asked about Steve Jobs' health. It's a legitimate concern. The answer was evasive. If Jobs is totally healthy, just say it!
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| Monday, July 21, 2008, 5:06 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Falls on Conservative Guidance |
Apple (AAPL, $156.67 after hours) reports fiscal Q3 (June) EPS of $1.19, 11 cents above the consensus of $1.08. Revenue of $7.46 billion topped the consensus of $7.37 billion. The stock is down after hours on weak September guidance.
For the latest downside-risk analysis, Tech-Stock Prospector subscribers should see today's Rob's Journal.
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| Monday, July 21, 2008, 3:09 PM — by Rob DeFrancesco, TechStock Radar |
| NETGEAR Stabilizes Ahead of Q2 Results |
Shares of NETGEAR (NTGR, $14.55) have stabilized after trading down to $12.41 last week. The company reports Q2 results on Wednesday. The market expects EPS of 35 cents on revenue of $196 million. Gross margin needs to have held up in Q2 as it dropped to 32.9% in Q1 from 34.7% in the year-ago period on pricing pressure in the home-networking space.
For more on NETGEAR, see TechStock Radar—July 7, 2008.
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| Monday, July 21, 2008, 12:35 PM — by Rob DeFrancesco, TechStock Radar |
| Zoran: Brookside Capital Takes 6% Stake |
Brookside Capital Management has taken a 6% stake in digital-video chipmaker Zoran (ZRAN, $10.02). The firm disclosed this morning in an SEC filing that it owns 3.127 million shares. Brookside owned no Zoran shares at the end of March.
As of Q1, Fidelity was the #1 investor in Zoran, with 5.214 million shares (10.1% of the outstanding shares) after buying 2.156 million shares in the March period. Zoran shares ended Q1 at $13.66. The stock is down 55% YTD.
For more on Zoran, see TechStock Radar—July 2 & 3, 2008.
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| Monday, July 21, 2008, 12:01 PM — by Rob DeFrancesco, TechStock Radar |
| Genentech Jumps 13%; Big Biotech in Play |
Genentech (DNA, $92.30) is up nearly 13% this morning after Roche offered to buy the remaining 44% of the company that it doesn’t already own for $89 a share, or $43.7 billion in cash. Roche put a low bid on the table: Genentech is easily worth $98.75 a share, or 25x the 2009 EPS estimate of $3.95 (PEG of 1.4 on estimated 2008 EPS growth of 18%).
For other biotech companies potentially in play, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Monday, July 21, 2008, 11:53 AM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com Tests Recent Low |
Priceline.com (PCLN, $101.22) is trading back near its July 7 low of $101.10. The stock has downside risk to the February low of $92.50. For more on Priceline.com, see TechStock Radar—July 15, 2008.
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| Monday, July 21, 2008, 9:37 AM — by Rob DeFrancesco, TechStock Radar |
| Take-Two Interactive: 'Meaningful Discussions' |
As EA extends its tender offer to August 18, Take-Two Interactive (TTWO, $25.04) still says it’s engaged in ‘meaningful discussions with multiple parties, a number of whom have been conducting due diligence.’ So far, talk of these discussions have actually been meaningless as a second bidder has yet to emerge. As of last Friday, 15% of Take-Two shares had been tendered to EA.
For more on Take-Two, see TechStock Radar—July 17, 2008.
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| Monday, July 21, 2008, 7:44 AM — by Rob DeFrancesco, TechStock Radar |
| Yahoo: Icahn Not So Bad After All |
Yahoo (YHOO, $22.45) on Friday used its homepage to trash Carl Icahn’s track record. Today Icahn is added to the board to settle the proxy dispute. At the annual meeting on August 1, eight Yahoo board members will stand for re-election, including Roy Bostock and Jerry Yang. Following the annual meeting, the board will expand to 11 members, including Icahn and two directors filled from a list of nine candidates supplied by Icahn.
Perhaps with Icahn and Yahoo now on the same side, a better (total) deal can be negotiated with Microsoft.
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| Monday, July 21, 2008, 7:13 AM — by Rob DeFrancesco, TechStock Radar |
| Seagate Technology: 'Sloppy Execution' |
Hard-drive supplier Seagate Technology (STX, $14.85) shares dropped 13% last week (hitting a new 52-week low of $14.27 on Wednesday) after the company said the September quarter would be a challenging one because of pricing pressure (7% price erosion, vs. the historic range of 3.5% to 5%) and margin compression. The fiscal Q1 (September) consensus EPS estimate collapsed to 24 cents from 58 cents and the December estimate dropped to 49 cents from 73 cents.
On the conference call, management said gross margin should rebound in the December quarter as new products ramp up and lower costs work through the model. CEO William Watkins said Seagate had been sloppy on product execution and spending, and that the blame rests solely on management. There’s a plan in place to get back on track, according to Watkins. Of course, that’s assuming the overall economy cooperates and demand holds up.
In fiscal 2008 (June), Seagate had revenue of $12.7 billion, cash flow from operations of $2.5 billion and free cash flow of $1.5 billion. Share repurchases totaled $1.5 billion in the latest fiscal year. The company has about $2 billion remaining on the current repurchase program, representing 28% of the recent market cap of $7.2 billion.
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| Sunday, July 20, 2008, 9:18 PM — by Rob DeFrancesco, TechStock Radar |
| iPhone Availability Down to Just 4 Stores |
According to Apple, exactly one Apple Retail store has the 16 GB black iPhone in stock: Stoneridge Mall in Pleasanton, California. The 8 GB iPhone is available only in Honolulu. Just two stores have the 16 GB for sale: Salem, New Hampshire and the Fifth Avenue location in NYC.
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| Sunday, July 20, 2008, 12:46 PM — by Rob DeFrancesco, TechStock Radar |
| IBM +20% YTD; New Fair Value Estimate |
IBM (IBM, $129.89) shares are up 20% YTD, hitting a new 52-week high of $130 on Friday. Last week, the company beat the Q2 consensus EPS estimate by 16 cents on continued strong growth in services and consulting. In Global Technology Services, contract signings rose 14%. On the server side, IBM’s midrange business saw growth of 68%, up from around 60% in the prior quarter. Storage revenue rose 12%, driven by 28% growth in the midrange and low end. In software, branded-middleware revenue advanced 12% and accounted for 55% of total software revenue.
For 2008, IBM now sees EPS of at least $8.75, up from previous guidance of at least $8.50. The company maintained its 2010 EPS goal of $10 to $11.
Here are the new EPS estimates:
2008e: $8.77 +23%
2009e: $9.78+11.5%
2010e: $10.95+12%
IBM trades at 14.8 times the 2008 consensus EPS estimate. Applying the same multiple to the 2009 estimate results in a fair value of $144.75.
For more on IBM, see TechStock Radar—April 17, 2008.
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| Sunday, July 20, 2008, 8:26 AM — by Rob DeFrancesco, TechStock Radar |
| Intuitive Surgical: Q2 Earnings Preview |
ThinkPanmure made a nice call earlier this month upgrading Intuitive Surgical (ISRG, $288.49) to ‘Buy’ when the stock was trading around $250. At the time, Intuitive Surgical shares had dipped 30% from the April high.
The company, which makes the da Vinci robotic-surgery system, reports Q2 results on Tuesday. The consensus estimates: EPS of $1.18 on revenue of $208.62 million.
According to this report from Bespoke Investment Group, Intuitive Surgical has a solid record of beating quarterly EPS and revenue estimates, but usually doesn’t raise guidance.
For 2008, the consensus revenue estimate of $873.5 million represents expected growth of 45%. The stock trades at 57 times the 2008 consensus EPS estimate of $5.07.
For more on Intuitive Surgical, see TechStock Radar—July 7, 2008.
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| Saturday, July 19, 2008, 10:46 PM — by Rob DeFrancesco, TechStock Radar |
| iPhone 3G Virtually Sold Out in California |
With the exception of the Sherman Oaks store (16 GB black in stock) and the Corte Madera store (8 GB black in stock), all 38 California Apple Retail stores are sold out of the iPhone 3G.
All 14 Apple Retail stores in Texas are sold out of 16GB (black and white) handsets.
In Florida, only the Lincoln Road store in South Beach has 16GB (white) handsets in stock. The 16 GB black is sold out at all 14 stores in the state. The 8 GB handset is only available at the Palm Beach Gardens store.
Among the 13 Apple Retail stores in New York, only the Fifth Avenue store has all three versions of the iPhone 3G in stock. The SoHo store has the 8GB black and the 16GB white. All other stores in the state are sold out.
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| Saturday, July 19, 2008, 2:36 PM — by Rob DeFrancesco, TechStock Radar |
| Salesforce.com: Teflon Tech Stock? |
While other tech titans watched their share prices get roughed up last week, Salesforce.com (CRM, $70.74) shares surged 11.8%. The stock is within spitting distance of its 52-week high of $75.21 reached on June 23. Salesforce.com shares roared back from the Tuesday low of $60.07, with Friday marking the fourth positive session in a row.
Sporting a market cap of $8.5 billion, Salesforce.com trades at nearly eight times estimated fiscal 2009 (January) revenue of $1.07 billion. It helps that revenue growth is expected to top 42% in the current fiscal year. But the growth rate could slow to 32% in fiscal 2010.
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| Saturday, July 19, 2008, 8:43 AM — by Rob DeFrancesco, TechStock Radar |
| Data Domain: Artis Capital Lifts Stake to 12.9% |
In an SEC filing yesterday afternoon, Artis Capital Management disclosed that it now owns 12.9% of Data Domain (DDUP, $22.35), a provider of de-duplication storage systems. The firm holds 7.503 million shares, up from 4.526 million shares (7.8% of the outstanding shares) held at the end of March. The firm is the #1 investor in Data Domain.
Artis acquired 4.418 million shares in Q1 when then the stock traded between $26.49 and $18.93.
In Q2, Artis shares traded between $25.16 and $20.00. This past week, Artis dipped to $19.73.
For more on Data Domain, Tech-Stock Prospector subscribers should see ‘TSP Watch List Update,’ TSP #89—May 2008.
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| Friday, July 18, 2008, 4:48 PM — by Rob DeFrancesco, TechStock Radar |
| Amazon.com Sweats It Out |
Amazon.com (AMZN, $69.12) shareholders must be scared. With Q2 earnings set for release next Wednesday, the fear factor is high following today’s 9.8% trashing of Google shares and the blistering attack on Overstock.com, which tanked 41%. Amazon.com trades at 46 times the 2008 consensus EPS estimate of $1.50, well above the estimated 2008 growth rate of 33%. Granted, the 2009 EPS estimate of $2.10 indicates growth ramping up to 40%. But in the current economic environment, both of these estimates look quite optimistic. If Amazon.com does manage to beat the Q2 consensus estimates (EPS of 26 cents on revenue of $3.96 billion) and maintain full-year guidance, it certainly will be the Internet Superhero. |
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| Friday, July 18, 2008, 2:50 PM — by Rob DeFrancesco, TechStock Radar |
| Qualcomm: Atalanta Sosnoff Opens Position |
In Q2, Atalanta Sosnoff Capital ($6.2 billion in long equity assets) opened a position in Qualcomm (QCOM, $45.22) of 2.497 million shares. This was one of only 12 new positions in the June quarter for the NYC-based money manager. Qualcomm shares have pulled back from last week’s high of $49.00, but remain above the July 1 low of $44.15 and the 200-day moving average of $42.17.
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| Friday, July 18, 2008, 12:14 PM — by Rob DeFrancesco, TechStock Radar |
| Rackable Systems +64% From January Low |
Shares of server vendor Rackable Systems (RACK, $12.70) have rebounded 64% from the January low of $7.76. On August 4, the company is expected to report breakeven results for the June quarter on revenue of $76.3 million. For the year, revenue of $350.4 million is expected to be flat compared to 2007 revenue of $353.1 million. At the end of March, Rackable had no debt and cash/investments of $206.9 million. Stripping these assets out of the current market cap results in an enterprise value of $169 million. In 2007, cash flow from operations totaled $46 million.
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| Friday, July 18, 2008, 10:33 AM — by Rob DeFrancesco, TechStock Radar |
| Google Risk/Reward Analysis |
I am reducing the Google (GOOG, $485.00) fair value to $588 from $643 based on a 2009 EPS estimate of $24.00 (the current consensus will fall from $24.77) and a forward P/E of 24.5. With today’s sharp pullback, the stock trades at 24.5 times my revised 2008 EPS estimate of $19.75 (the current consensus will fall from $20.14). My old fair value was based on a forward P/E of 26 applied to a 2009 EPS estimate of $24.73.
Google is not immune to the slowdown in online advertising. But Q2 paid-click growth of 19% was respectable and the bottom line was negatively effected by a jump in G&A expenses (higher legal fees) and lower interest income. Google dominates paid search and has yet to monetize when it comes to display ads and video ads. When Web advertising rebounds, Google will be at the forefront.
What’s the downside risk? I get $442 based on a forward P/E of 19.2 on a 2009 EPS estimate of $23.00 (16% growth and PEG of 1.2).
At this point, the risk/reward situation looks like this: 21% upside and 9% downside.
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| Friday, July 18, 2008, 8:22 AM — by Rob DeFrancesco, TechStock Radar |
| SanDisk: Caris Sees Rebound to $20.50 |
Caris starts coverage of SanDisk (SNDK, $18.12) with a rating of ‘Above Average’ and a price target of $20.50 based on an improvement in the NAND flash supply/demand picture in 2H as seasonal demand picks up and prices stabilize. SanDisk shares have already rallied 13% from Tuesday’s low of $16.02.
For AmTech’s take on SanDisk, see TechStock Radar—July 17, 2008.
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| Friday, July 18, 2008, 7:37 AM — by Rob DeFrancesco, TechStock Radar |
| June Videogame Software Sales +61% |
Videogame sales in the U.S. jumped 53% in June, according to NPD Group. The research firm says industry revenue is on track to top $22 billion this year. Hardware sales were up 54%, driven by 666,700 Nintendo Wii units and 783,000 DS units. Software sales advanced 61%, driven by 774,600 units of Metal Gear Solid 4 and 422,300 units of Guitar Hero on Tour.
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| Thursday, July 17, 2008, 6:26 PM — by Rob DeFrancesco, TechStock Radar |
| Take-Two Interactive In Limbo |
Take-Two Interactive (TTWO, $24.95) shares rallied from last week’s low of $23.26, but remain below EA’s hostile offer of $25.74 and the recent high of $27.95. Activision Blizzard has been in the spotlight over the past week with the completion of the merger and the upside revenue/earnings guidance. EA must feel itself losing some momentum as it’s no longer the biggest player in the videogame world. A slightly higher offer for Take-Two Interactive would cause some sparks and jumpstart EA back into the game. The deadline for the tender offer expires tomorrow, so expect another extension as EA waits to hear back from the FTC regarding any antitrust concerns.
For more on Take-Two Interactive, see TechStock Radar—June 17, 2008.
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| Thursday, July 17, 2008, 4:25 PM — by Rob DeFrancesco, TechStock Radar |
| Google Smack Down |
Google (GOOG, $477.22 after hours) is off 10.5% after hours because Q2 EPS of $4.63 missed the consensus estimate by 11 cents. Revenue of $3.9 billion came in on target. Paid clicks rose 19% year over year and fell 1% sequentially. International revenue represented 52% of total revenue.
In Q2, revenue at Google-owned sites (66% of total revenue) rose 42% year over year and 4% sequentially, while revenue from the Google AdSense Network (31% of total revenue) rose 22% year over year and fell 2% sequentially.
Cash flow from operations totaled $1.77 billion and the company spent $698 million on capital expenditures. Free cash flow came in at $1.07 billion. Google says it expects to continue to make ‘significant capital expenditures.’ The company has $12.7 billion in cash & marketable securities on its balance sheet.
I wrote yesterday that the technical indicators pointed to a significant pullback to the $460 to $480 range. They turned out to be correct. For more on Google, see TechStock Radar—July 16, 2008.
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| Thursday, July 17, 2008, 2:30 PM — by Rob DeFrancesco, TechStock Radar |
| ON Semi Jumps on Catalyst Purchase |
This morning’s announcement that ON Semiconductor (ONNN, $9.22) would purchase chipmaker Catalyst Semiconductor (CATS, $6.29) in an all-stock deal worth about $115 million was met with a positive reaction. The actual value of the deal is $85 million since Catalyst has $30 million in cash on its balance sheet. Many acquisitions are met with skepticism, with the buyer’s shares falling on the news. What’s different here? First off, the deal will have minimal impact on ON Semi’s EPS next year (vs. being dilutive) and add to earnings in the following year. Plus, Catalyst’s analog/mixed-signal net revenue in its latest quarter rose 44% year over year and 20% sequentially. Catalyst’s EEPROM technology will strengthen ON Semi’s custom ASICs and power-products capabilities across the digital consumer and wireless end markets. The deal is expected to close in Q4. Another positive: ON Semi says the integration of AMIS Holdings is on track and that it’s comfortable with its most recent guidance from early May.
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| Thursday, July 17, 2008, 12:44 PM — by Rob DeFrancesco, TechStock Radar |
| eBay: Downside Risk to $20.65 |
Until eBay (EBAY, $23.77) shows some signs of getting its house in order, the stock has downside risk to around $20.65, or 12X the low end of 2008 EPS guidance of $1.72. The company’s auction business (representing 57% of GMV) is moving to zero growth. Conversion rates and ASPs are on the decline. Combined with the current economic malaise, eBay faces a sharp deterioration in its core business.
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| Thursday, July 17, 2008, 11:14 AM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion Fails at 200-Day Moving Average |
Research in Motion (RIMM, $110.33) failed this morning on its first attempt to take out the 200-day moving average at $114.29. Not a surprise. For the latest update on RIM, Tech-Stock Prospector subscribers should see today’s Rob’s Journal |
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| Thursday, July 17, 2008, 9:45 AM — by Rob DeFrancesco, TechStock Radar |
| eBay Slaughtered |
eBay (EBAY, $24.17) is down 14% this morning after last night’s dismal Q2 earnings report. The company’s core business is at risk from Amazon.com and Google Product Search. GMV in the June period was up just 4% excluding foreign-currency benefits. While PayPal is a solid business, it’s not the engine that can be relied upon to turn around the entire company. And Skype is simply an interesting concept.
For more on eBay, see TechStock Radar—July 16, 2008.
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| Thursday, July 17, 2008, 9:27 AM — by Rob DeFrancesco, TechStock Radar |
| SanDisk: AmTech Still Bullish |
AmTech lowers its price target on SanDisk (SNDK, $17.36) to $29 from $40 because of continued weakness in NAND pricing. But the firm maintains a ‘Buy’ rating based on the argument that supply cuts in 2H will stabilize the market. SanDisk reports Q2 results on Monday. The consensus estimates: EPS of 14 cents on revenue of $911 million.
For more on SanDisk, see TechStock Radar—July 11, 2008.
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| Thursday, July 17, 2008, 7:19 AM — by Rob DeFrancesco, TechStock Radar |
| Microsoft + Icahn: The New Odd Couple |
This is good stuff. The newest Yahoo letter to shareholders points out the flip flops made by both Icahn and Microsoft (at least they have that in common) and the sad state of Microsoft's online-services business.
Yahoo's take on Microsoft (from the letter):
This "odd couple" collaboration - between two parties with keenly different agendas - is indeed perplexing. Why does Mr. Icahn believe he can count on Microsoft to complete a transaction? Certainly Microsoft is a well-respected and successful company and we have been clear that we are fully prepared to do a deal with them. But Microsoft's flip flops and inconsistencies over the past five months are so stupefying that one can only conclude that Microsoft was never fully committed to acquiring Yahoo! either because:
-- Microsoft can't decide what is and isn't strategically important to its online business; or
-- Microsoft is more interested in destabilizing a key competitor so that it can either enhance its competitive position or buy our highly valuable search business--and the enormously desirable intellectual property associated with it --at a bargain basement price.
Microsoft desperately needs to improve the performance of its online services business (consisting of its search and display assets) which, cumulatively since 2003, has lost money despite billions of dollars of investment. And yet Mr. Icahn would ignore this track record and its implications for his fellow Yahoo! stockholders, swallowing a deal that leaves Yahoo!'s future dependent, in part, on Microsoft's ability to monetize search. And, as Mr. Icahn has himself pointed out, it would eliminate any opportunity we may have to sell the entire Company for an attractive premium.
And now Icahn (from the letter):
Carl Icahn bought his stock two months ago for an estimated average cost of less than $25 per share. He is well-known as a corporate agitator with a short-term approach to his investments. His short-term approach gives Mr. Icahn a strong incentive to strike any deal with Microsoft that enables him to recover his investment and get back his money quickly, even a deal that does not provide full and fair value to you. Is that in the interests of all stockholders? Clearly, it is not.
Mr. Icahn can't make up his mind about what he thinks will work for Yahoo!. He bought his position believing that he could bring Microsoft back to buy all of Yahoo!, at one point suggesting we publicly offer to sell Yahoo! to Microsoft for $34.375. But he didn't do enough due diligence to determine what your Board already knew: that it was Microsoft's decision to walk away and that it had rebuffed repeated efforts by your independent directors to get a whole company acquisition back on the table. Recognizing that a sale to Microsoft might not be an option, Mr. Icahn said as an alternative that we should enter into an agreement with Google (which we were already negotiating and subsequently signed), and that we should walk away from Microsoft's search-only proposal (which we did after careful evaluation of that proposal). Then, in an extraordinary flip flop, Mr. Icahn teamed up with Microsoft and embraced their latest joint search-only proposal--even though it involved significant execution and operational risks and was fraught with flaws that made the "headline value" asserted by Microsoft and Mr. Icahn more illusion than reality.
Yahoo does make a good point about Icahn. He just wants to make a buck, which is totally fine.
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| Thursday, July 17, 2008, 7:04 AM — by Rob DeFrancesco, TechStock Radar |
| iPhone 3G's Achilles Heel |
So many people are complaining about the iPhone 3G’s short battery life. For enterprise users, the ability to change the battery on a smartphone (especially while on the road) is often a must-have feature. Apple’s fixed battery is going to limit its ability to make any significant inroads into the corporate market. [TG Daily]
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| Wednesday, July 16, 2008, 4:52 PM — by Rob DeFrancesco, TechStock Radar |
| eBay Blows It Once Again |
eBay (EBAY, $26.50 after hours) fails to impress once again and the stock is down 5.7% after hours after rising 4.5% during the regular session. While Q2 EPS of 43 cents beat the consensus by two cents, the company was aided by a lower tax rate (22% vs. 23% in Q1 and 25% in the year-ago quarter) and a buyback of 19 million shares. GMV rose just 8% after being up 12% in Q1. Non-GAAP operating margin of 31.9% fell from 32.4% in Q2’07 because of a higher contribution from the PayPal and Skype units, which reported revenue growth of 33% and 51%, respectively. For Q3, eBay sees EPS of 39 cents to 41 cents, vs. the consensus of 41 cents. eBay shares ended 2007 at $33.19.
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| Wednesday, July 16, 2008, 3:47 PM — by Rob DeFrancesco, TechStock Radar |
| Google Turns it Around |
When I wrote this morning that Google (GOOG, $533.19) was setting up for a big move, I didn’t think for a second that it’d be up 17 points today. But with today’s jump, the bar is raised even higher for tomorrow’s earnings report. For a Google earnings preview, see TechStock Radar—July 11, 2008.
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| Wednesday, July 16, 2008, 2:11 PM — by Rob DeFrancesco, TechStock Radar |
| Is Needham's Charlie Wolf a Crazy Apple iFan? |
Needham & Co. analyst Charlie Wolf expects the 3G iPhone to have a significant deleterious effect on consumer-handset sales at Research in Motion (RIMM, $109.00). Today he cut RIM to ‘Underperform’ from ‘Hold’ and chopped his 2009 EPS estimate to $4.80 from $6.25. Wolf says RIM’s fair value is $87 a share, 20% below the current price.
While RIM is about to launch an all-out offensive in the consumer space with several new handsets aimed at the consumer market—including the 3G Bold and touchscreen Thunder—Wolf says these will be ‘iPhone look-a-likes’ that don’t offer the same unique user experience.
At the same time, Wolf has a $240 price target on Apple (AAPL, $170.87). He sees the 3G iPhone driving Mac sales over the next several quarters thanks to everyone’s favorite ‘halo effect’ catch phrase. His fiscal 2009 EPS estimate of $6.95 is the highest out there—the consensus is $6.38.
Is Wolf a crazy Apple fan? His $240 price target is 40% above current levels. I think he’s a tad bit optimistic on Apple. But he’s way too negative on Research in Motion, which still boasts a significant enterprise base of customers who think the iPhone is a toy. Plus, the consumer smartphone market is big enough and growing fast enough to support a few winning players.
Meanwhile, Pacific Crest is out today with favorable comments on RIM, saying handset sales for the first half of July tracked ahead of plan at Verizon.
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| Wednesday, July 16, 2008, 12:45 PM — by Rob DeFrancesco, TechStock Radar |
| Openwave: S Squared Ups Stake to 13.9% |
Since the end of March, S Squared Technology has increased its position in mobile-software provider Openwave Systems (OPWV, $1.43) to 11.627 million shares from 8.127 million shares. The tech-focused money manager now controls 13.95% of the outstanding shares and is the #1 holder.
In Q2, Openwave shares traded between $2.86 and $1.33. The stock ended last year at $2.60 a share.
Lord Abbett, previously the #1 investor, reduced its position to 3.996 million shares from 8.78 million since the end of March. Austin Marxe and David Greenhouse (AWM Investment), previously the #3 investor, cut its position to 3.793 million shares from 5.847 million shares held at the end of Q1.
Last week, Openwave appointed Karen Willem as CFO, a veteran of Network General, Brio Software (now part of Oracle) and Avantek. At the end of June, Openwave sold its mobile browser and messaging business for $32 million in cash to Purple Labs. Openwave is in the middle of a restructuring to refocus its business on key growth sectors of the mobile market, including personalization and advertising.
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| Wednesday, July 16, 2008, 10:27 AM — by Rob DeFrancesco, TechStock Radar |
| NYC iPhone Lines--Day 6 |
All NYC Apple retail locations are now sold out of the 16 MB black iPhone.
Here's the latest update from Racked.
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| Wednesday, July 16, 2008, 9:33 AM — by Rob DeFrancesco, TechStock Radar |
| Expedia Stabilizes & Adds Venere |
Expedia (EXPE, $18.44) shares are trying to stabilize in the $17 to $19 range after falling sharply from the May high of $25.50. Expedia reports Q2 results on July 31.
Yesterday Expedia announced it would acquire Venere.com, a travel website based in Italy with established relationships with 29,000 hotels and B&Bs throughout Europe and the U.S. Venere is adding about 1,000 hotel properties per month to its network. About 90% of Venere’s current offerings are in Europe.
For more on Expedia, see TechStock Radar—July 10, 2008.
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| Wednesday, July 16, 2008, 7:20 AM — by Rob DeFrancesco, TechStock Radar |
| Google Sets Up for Big Move |
Google (GOOG, $516.09) closed below $520 support yesterday even though it was able to recover from the intraday low of $501.10. The stock, which on a technical basis appears ready for a significant pullback to the $460 to $480 area, could be saved by a powerful Q2 earnings report tomorrow. Expectations are high going into the report: The consensus estimate has risen three cents over the past 30 days to $4.74.
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| Tuesday, July 15, 2008, 3:44 PM — by Rob DeFrancesco, TechStock Radar |
| NYC iPhone Lines |
Four days into the launch, the iPhone lines were going strong this morning at the NYC Apple stores. Check out the Racked article here.
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| Tuesday, July 15, 2008, 2:25 PM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com Tumbles |
Priceline.com ($104.19) fell to $98.33 this morning, taking out the July 7 low of $101.10, before recovering somewhat this afternoon along with the overall market. While the RSI is setting up for a positive divergence, there’s downside risk to the February low of $92.50 on a close below $106. The stock remains well below its 200-day moving average of $113.52.
For more on Priceline.com, see TechStock Radar—July 9, 2008.
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| Tuesday, July 15, 2008, 11:04 AM — by Rob DeFrancesco, TechStock Radar |
| Genzyme Pushes Higher |
Genzyme (GENZ, $79.12) is up nearly 3% this morning on heavy volume of 2 million shares after taking out the April 4 high of $76.76 last week. The stock has pushed above the February 1 high of $79.00, so the next level of interest on the upside is the 52-week high of $82.08 reached in January. The RSI is rising from 73.0. Genzyme is up 21% from the June low of $65.21.
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| Tuesday, July 15, 2008, 9:56 AM — by Rob DeFrancesco, TechStock Radar |
| Google Breaks Lower |
Google (GOOG, $505.43) has taken out the June 27 low of $515.09. The technical situation is deteriorating with the 50-day moving average now trending down from $558.96. There’s initial downside risk to $480.
For more on Google, see TechStock Radar—July 14, 2008.
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| Tuesday, July 15, 2008, 8:20 AM — by Rob DeFrancesco, TechStock Radar |
| Cogent: FBR Sees Downside to $10 |
FBR sees Cogent Communications (CCOI, $11.86) shares falling to $10 based on the argument that IP bandwidth has become a commodity with prices in a downtrend. The firm lowers its rating on Cogent to ‘Underperform.’
For more on Cogent, see TechStock Radar—July 11, 2008.
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| Monday, July 14, 2008, 4:44 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Pulls Back From Morning High |
Apple (AAPL, $173.88) managed to hold onto some of its earlier gains, but finished well off the opening high of $179.30. Volume was fairly light at 31.5 million shares.
For the latest Apple trading outlook, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Monday, July 14, 2008, 2:31 PM — by Rob DeFrancesco, TechStock Radar |
| Online Video Traffic Jumps in May |
According to ComScore (SCOR, $19.93), U.S Internet users watched more than 12 billion online videos in May, up 45% from the same month last year. About 74% of the total U.S. Internet audience for the month watched an online video.
In terms of unique viewers, Google’s (YouTube) share was 50.2% and Fox Interactive had 12.8%. Time Warner (including AOL) was third with a 10.7% share. Yahoo and Microsoft accounted for 8.6% of viewers and 8.3% of viewers, respectively.
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| Monday, July 14, 2008, 11:39 AM — by Rob DeFrancesco, TechStock Radar |
| Google Tests Support |
Google (GOOG, $523.49) is once again testing support around $520. The stock traded down to $516 this morning, but held the June 27 low of $515.09. A break below $520 on a closing basis sets up potential downside move to $480.
For more on Google, see TechStock Radar—July 11, 2008.
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| Monday, July 14, 2008, 9:21 AM — by Rob DeFrancesco, TechStock Radar |
| TriQuint Semiconductor: iPhone Winner |
TriQuint Semiconductor (TQNT, $5.79 pre market) has three power amps in the 3G iPhone, according to this teardown from Portelligent and Semiconductor Insights.
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| Monday, July 14, 2008, 8:33 AM — by Rob DeFrancesco, TechStock Radar |
| Microsoft Earnings Preview |
Microsoft (MSFT, $25.25) reports fiscal Q4 (June) results on Thursday. The consensus estimates: EPS of 47 cents on revenue of $15.65 billion. The company is expected to meet estimates based on a solid PC market in the quarter. Investors will focus on the outlook for enterprise demand, including Server 2008 and Hyper-V.
At these depressed levels for the stock, Microsoft may jumpstart its buyback program. Microsoft trades at less than 12 times the fiscal 2009 (June) consensus EPS estimate of $2.16.
The lagging online business will be the main topic of Microsoft’s July 24 Analyst Day.
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| Sunday, July 13, 2008, 4:11 PM — by Rob DeFrancesco, TechStock Radar |
| Apple 3G iPhone Opening Weekend Estimates |
According to RBC estimates, Apple (AAPL, $172.58) will have sold 1 million 3G iPhones during the three-day launch. But is this estimate way too optimistic? I’ve seen estimates as low as 450,000. For obvious reasons, expectations were extremely high for the 3G iPhone going into the launch.
Movie studios always try to play down potential blockbusters so as not to look foolish if the numbers don’t come in as planned. My favorite movie-industry blogger Nikki Finke reports Warner Brothers is trying to talk down opening-weekend projections for The Dark Knight from the $130 million to $150 million range. This summer, the 3G iPhone is the handset industry’s Batman Begins sequel.
For my 3G iPhone back-of-the-envelope opening weekend sales projection, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Sunday, July 13, 2008, 9:11 AM — by Rob DeFrancesco, TechStock Radar |
| Apple 3G iPhone Sales Watch |
For the latest update on 3G iPhone sales, Tech-Stock Prospector subscribers should see today's Rob's Journal. |
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| Sunday, July 13, 2008, 8:03 AM — by Rob DeFrancesco, TechStock Radar |
| Yahoo Rejects New MicroCarl Offer |
Microsoft and Carl Icahn proposed a breakup of Yahoo. As part of the deal, Microsoft would acquire Yahoo’s search business and Icahn would get the rest of the company.
The proposal, which was made on Friday evening, included a 24-hour deadline for Yahoo.
Yahoo rejected the offer overnight, calling the alliance between Microsoft and Carl Icahn ‘odd and opportunistic.’
Yahoo repeated its offer to sell the company to Microsoft for at least $33 a share and to negotiate an improved search-only transaction. Microsoft rejected both offers.
In May, Microsoft said it would pay $1 billion for the search business and invest $8 billion for a 16% stake in Yahoo. The new proposal contains a number of improvements over Microsoft’s earlier proposal, according to Yahoo. But it requires the immediate replacement of the current Yahoo board and removal of the top management team.
From the Yahoo rejection press release:
Mr. Bostock continued, “After negotiating among themselves without the involvement of Yahoo!, Carl Icahn and Microsoft presented us with a ‘take it or leave it’ proposal under which we would be required to restructure the Company, hand over to Microsoft Yahoo!’s valuable search business and to Carl Icahn the rest of the Company, giving us less than 24 hours to respond. It is ludicrous to think that our Board could accept such a proposal. While this type of erratic and unpredictable behavior is consistent with what we have come to expect from Microsoft, we will not be bludgeoned into a transaction that is not in the best interests of our stockholders.”
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| Saturday, July 12, 2008, 10:10 AM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion v. Apple |
Research in Motion (RIMM, $109.79) shares fell 4.6% last week and are now down 6.1% so far in July, while Apple (AAPL, $172.58) shares rose 1.4% for the week and are up 3.1% for the month.
RIMM shares YTD: -3.2%
AAPL shares YTD: -12.9%
RIMM P/E on FY’10 (Feb.) consensus EPS estimate: 20.3
AAPL P/E on FY’09 (Sept.) consensus EPS estimate: 27.1
RIMM Est. FY’10 EPS growth: 42%
AAPL Est. FY’09 EPS growth: 23%
RIMM price-to-forward sales: 4.0
AAPL price-to-forward sales: 3.8
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| Saturday, July 12, 2008, 9:25 AM — by Rob DeFrancesco, TechStock Radar |
| Geolocation: We See You |
Gartner predicts 43 million people around the world will use location-based services (LBS) on their mobile phones this year, up from 16 million last year.
The LBS market could top $8.1 billion in three years from $1.3 billion this year.
For more, check out this Washington Post article.
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| Saturday, July 12, 2008, 8:06 AM — by Rob DeFrancesco, TechStock Radar |
| Apple Survives Activation Issues |
It wasn’t a pretty debut for the 3G iPhone, but at least it’s over. The huge onslaught of activations and 2.0 downloads overwhelmed the iTunes servers. The problem was one of the top stories all over the news yesterday.
But doesn’t this demand just indicate how much love there is for the iPhone?
Not only did Apple (AAPL, $172.58) create huge initial buzz for the 3G version with the price cut, it also sparked old-school iPhone users to upgrade to 2.0 with the new App Store.
Now it’s time for Apple to start ringing up the sales so it can beat that goal of 10 million iPhones sold in 2008 and keep the stock price up.
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| Friday, July 11, 2008, 4:29 PM — by Rob DeFrancesco, TechStock Radar |
| Google Holds Support |
Google (GOOG, $533.80) finished down 1.2% today, but rallied from an intraday low of $519.43. This marks the third time since the end of June that Google tested support just below $520 before closing firmly above that level.
The June 27 low of $515.09 still marks the low for the recent downward move from the May 2 high at $602.45, representing a 14.5% pullback.
For more on Google, see today's earlier TechStock Radar.
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| Friday, July 11, 2008, 2:44 PM — by Rob DeFrancesco, TechStock Radar |
| MetroPCS Off 29% From May High |
Shares of wireless provider MetroPCS (PCS, $15.44) have dropped 29% from the May high. The stock took a hit last week after the company said it added net 184,000 subscribers in Q2, below the consensus of 195,000.
MetroPCS now has 4.6 million subscribers. On July1, MetroPCS entered the Philadelphia market via six company-owned stores and 132 authorized dealers.
For more on MetroPCS, see TechStock Radar—May 23, 2008.
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| Friday, July 11, 2008, 1:23 PM — by Rob DeFrancesco, TechStock Radar |
| The Knot: Wellington Takes 10.7% Stake |
Wellington Management has taken a 10.7% stake in The Knot (KNOT, $8.18), an operator of wedding-related websites. Shares of The Knot are down 65% from the 52-week high of $23.37.
In Q1, revenue rose 13% to $23.8 million, but came in below the consensus estimate of $25.1 million. Per-share earnings of two cents missed the consensus by three cents because of higher than expected technology and hiring costs. Over the past 90 days, the 2008 consensus EPS estimate has fallen to 24 cents from 41 cents.
Wellington owns 3.437 million shares. At the end of March, T. Rowe Price was the #1 holder with 3.53 million shares.
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| Friday, July 11, 2008, 11:49 AM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion Trading Update |
Research in Motion (RIMM, $112.79) shares this morning took out Monday's low.
For the latest trading advisory, Tech-Stock Prospector subscribers should see today's Rob's Journal.
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| Friday, July 11, 2008, 10:06 AM — by Rob DeFrancesco, TechStock Radar |
| Cogent Hits New Low |
Cogent Communications (CCOI, $12.29) fell to a 52-week low this morning and is now off 65% from its 52-week high.
The stock has been trending down ever since the company reported weak Q1 results in early May.
For more on Cogent, see TechStock Radar—May 12, 2008.
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| Friday, July 11, 2008, 8:13 AM — by Rob DeFrancesco, TechStock Radar |
| SanDisk Suffers |
SanDisk (SNDK, $16.97) hit a new 52-week low yesterday of $16.45. The stock is now off 49% YTD.
Citi today lowers its price target to $20 form $27, citing continued weak end demand for flash and the risk of more P/E-multiple compression.
SanDisk trades at 12 times the 2008 consensus EPS estimate of $1.39, which is down from $1.72 at the start of April. The 2009 estimate has been falling as well—down to $1.74 from $1.94.
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| Friday, July 11, 2008, 7:17 AM — by Rob DeFrancesco, TechStock Radar |
| Google Earnings Preview |
Deutsche Bank starts coverage of Google (GOOG, $540.57) with a ‘Buy’ and a price target of $635 based on continued domination of paid search and an attractive valuation.
For Q2, the focus will once again be on paid clicks. Google shares surged after the company reported Q1 paid clicks rose 20%, well above ComScore’s estimate of 1.8%. In the June quarter, look for paid-click growth of 15% to 18%.
International revenue will be another important metric as it accounted for 51% of total revenue in the March period. Google’s take on what’s going on in Europe in terms of Web advertising will be widely watched.
Google reports Q2 results next Thursday. The consensus numbers: EPS of $4.73 on revenue of $3.86 billion.
For more on Google, see TechStock Radar—June 30, 2008.
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| Thursday, July 10, 2008, 6:30 PM — by Rob DeFrancesco, TechStock Radar |
| Emulex Cuts Fiscal Q4 Guidance |
Emulex (ELX, $10.71) cut its fiscal Q4 (June) revenue guidance to $111 million to $113 million from $118 million to $123 million. The consensus is $120.9 million. The company now sees EPS of 19 cents to 20 cents, vs. previous guidance of 24 cents to 27 cents and the consensus of 25 cents. Full results will be released on August 7th.
The company experienced a steeper than expected decline in its embedded storage products and weaker than expected demand for its host server products.
In fiscal 2007, Emulex’s largest OEM customers were IBM (25% of revenue), EMC (18%) and Hewlett-Packard (13%).
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| Thursday, July 10, 2008, 5:01 PM — by Rob DeFrancesco, TechStock Radar |
| Red Hat: Wellington Ups Stake to 13.3% |
Since the end of March, Wellington Management purchased 19.4 million shares of Red Hat (RHT, $19.83). In Q2, Red Hat shares traded as low as $18.37 (April 1) and as high as $24.84 (June 2).
Wellington now owns 25.518 million shares, representing 13.39% of the outstanding shares.
At the end of March, T. Rowe Price was the #1 Red Hat investor with 23.26 million shares.
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| Thursday, July 10, 2008, 4:46 PM — by Rob DeFrancesco, TechStock Radar |
| Atheros: Wellington Owns 10.3% |
Wellington Management disclosed today that it owns 10.3% of broadband chipmaker Atheros Communications (ATHR, $30.86). The firm holds 6.119 million shares. This is a new position for Wellington accumulated since the end of March. In Q2, Atheros shares traded as low as $21.78 (April 1) and as high as $34.55 (June 5).
At the end of March, these firms were the largest Atheros shareholders:
*Fidelity—8.849 million shares
*Alger—3.809 million shares
*Friess—2.960 million shares
*Calamos—2.338 million shares
*Bessemer—2.217 million shares
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| Thursday, July 10, 2008, 1:30 PM — by Rob DeFrancesco, TechStock Radar |
| VeriSign Rebounds |
After dipping to $32.59 on Tuesday, VeriSign (VRSN, $35.26) shares are rebounding 4.4% today on heavy volume of more than 4.9 million shares. There’s resistance at the 200-day moving average of $35.90.
For more on VeriSign, see TechStock Radar—July 9, 2008.
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| Thursday, July 10, 2008, 11:31 AM — by Rob DeFrancesco, TechStock Radar |
| AT&T Starts Doubling 3G Data Capacity |
AT&T (T, $32.78) has started doubling the data capacity of its nearly 300 3G markets and says nearly half of all cell sites will receive additional 3G capacity by the end of the year. Also, AT&T plans to expand its 3G network to nearly 350 major U.S. metro areas by the end of the year.
AT&T is deploying additional 3G coverage using 850 MHz spectrum, which extends farther and offers better coverage for building interiors.
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| Thursday, July 10, 2008, 9:22 AM — by Rob DeFrancesco, TechStock Radar |
| Expedia Off 30% From May High |
Expedia (EXPE, $17.81) shares hit a 52-week low this week at $16.85. The stock, which is down 30% from the May high of $25.50, now trades 12 times the 2008 consensus EPS estimate of $1.47 and 10.6 times the 2009 estimate of $1.68. The growth rate is expected to average 17.3%.
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| Thursday, July 10, 2008, 9:00 AM — by Rob DeFrancesco, TechStock Radar |
| Foundry Networks: Stifel Sees $16 |
Stifel starts coverage of Foundry Networks (FDRY, $11.16) with a ‘Buy’ and a price target of $16 based on the company’s strong position in Ethernet LAN switching, which is in the middle of an enterprise upgrade cycle. Plus, the firm says Ethernet switching is playing a more significant role in the datacenter thanks to the increased use of virtualization.
In the service-provider market, Foundry last month enhanced the performance and functionality of its multi-service NetIron XMR backbone routers and NetIron MLX metro routers. Foundry now delivers 320 Gpbs link aggregation capacity and allows the efficient scaling of Metro/Carrier Ethernet services through MPLS integration with Layer 2 networks and enhances the stability of large BGP networks through the isolation of unstable customer networks.
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| Wednesday, July 9, 2008, 4:21 PM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion Rally Falters |
Research in Motion (RIMM, $117.54) saw today’s earlier gains wiped out. After hitting a high of $122.13, RIM shares ended down 3.7% on average volume.
For more on RIM, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Wednesday, July 9, 2008, 3:07 PM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com Attempts Rebound |
Priceline.com (PCLN, $110.32) is on the rebound today after dipping to $101.10 on Monday. The stock took out support at $106 on a closing basis, but has managed to hold up for now. On the negative side, this morning’s rebound to the 200-day moving average at $113.15 failed, which sets up a possible test of the recent lows.
For more on Priceline.com, see TechStock Radar—July 4, 2008.
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| Wednesday, July 9, 2008, 11:12 AM — by Rob DeFrancesco, TechStock Radar |
| BigBand Networks -50% From April High |
Shares of BigBand Networks (BBND, $4.06) are down nearly 50% from the April high of $7.96. The market cap has sunk to $256 million, but the company has no debt and $150 million in cash & marketable securities on the balance sheet. The enterprise value of $106 million is well below expected 2008 revenue of $178 million.
BigBand provides video-networking platforms to the cable and telecom sectors. Its solutions support video on demand, interactive TV and advanced advertising. In Q1, BigBand’s four largest customers—Cablevision, Cox, Time Warner Cable and Verizon—each accounted for more than 10% of total revenue.
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| Wednesday, July 9, 2008, 9:01 AM — by Rob DeFrancesco, TechStock Radar |
| VMware: Pacific Crest Cuts Target to $50 |
Pacific Crest cuts its price target on VMware (VMW, $40.19) to $50 from $85 following Green’s departure and reduced revenue guidance. VMware also faces increased competition in the virtualization world from Microsoft’s Hyper-V.
Pacific Crest says the next significant catalyst will be VMWorld in the middle of September.
For more on VMware, see TechStock Radar—July 8, 2008.
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| Wednesday, July 9, 2008, 6:47 AM — by Rob DeFrancesco, TechStock Radar |
| VeriSign: Baird Sees $42 |
Baird upgrades VeriSign (VRSN, $32.85) to ‘Outperform’ with a price target of $42 based on valuation after the pullback from the June high of $42.50.
The stock trades at 33 times the 2008 consensus EPS estimate of $1.00 and 21 times the 2009 estimate of $1.59.
For more on VeriSign, see TechStock Radar—July 8 and July 3, 2008.
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| Tuesday, July 8, 2008, 5:07 PM — by Rob DeFrancesco, TechStock Radar |
| Sigma Designs: Steelhead Partners Ups Stake to 6% |
Since the end of March, Steelhead Partners bought 1.366 million shares of chipmaker Sigma Designs (SIGM, $15.63). Based in Seattle, Steelhead Partners is a value shop that specializes in out-of-favor names.
After trading as high as $73 last December, Sigma Designs shares fell to a 52-week low of $13.57 last week.
In an SEC filing today, Steelhead Partners disclosed that it now owns 1.6 million shares, or 6% of the outstanding shares. In Q1, the firm initiated a Sigma position of 233,500 shares. The stock dipped to $20.10 during the March quarter.
At the end of March, Tiger Global Management was Sigma’s largest investor with 1.44 million shares and Coatue Management was #2 with 1.37 million shares.
Sigma trades at just 8 times the fiscal 2009 (January) consensus EPS estimate of $1.86. In early April, the consensus estimate stood at $2.24. The company stumbled badly this year on a pullback in demand for media processors used in IPTV set-top boxes.
For more on Sigma Designs, Tech-Stock Prospector subscribers should see ‘TSP Watch List Update,’ TSP #88—April 2008.
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| Tuesday, July 8, 2008, 3:33 PM — by Rob DeFrancesco, TechStock Radar |
| Google Trading Update |
Google (GOOG, $553.64) is attempting a run to its 50-day moving average at $563.10 after holding support at $520. The 200-day moving average has flatlined at $576.37.
For more on Google, see TechStock Radar—July 3, 2008.
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| Tuesday, July 8, 2008, 2:26 PM — by Rob DeFrancesco, TechStock Radar |
| VMware Repriced |
VMware (VMW, $38.60) shares are down more than 27% this afternoon on hefty volume of 15 million shares, about three times average daily volume.
Assuming the new guidance of revenue growth ‘modestly below’ 50% translates into 45% growth, 2008 revenue should come in around $1.93 billion, down from the consensus estimate of $2.0 billion.
Assigning a forward price-to-sales ratio of 6.5 (it currently stands at 7.7) results in initial downside risk to around $32.70 a share. We’ll know more when Q2 results are released on July 22.
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| Tuesday, July 8, 2008, 12:32 PM — by Rob DeFrancesco, TechStock Radar |
| Tech-Stock Prospector July 2008 Issue Now Available |
The July 2008 issue of Tech-Stock Prospector (TSP #91) has been posted to the website. Subscribers can access the PDF from the main subscriber page.
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| Tuesday, July 8, 2008, 9:42 AM — by Rob DeFrancesco, TechStock Radar |
| VMware Slumps 22%; CEO Out |
VMware (VMW, $41.23) shares are down 22% after the company says CEO Diane Greene is out and that 2008 revenue growth will be ‘modestly below’ previous guidance of 50% growth.
EMC picks Paul Maritz, president of the EMC Cloud division, as Green’s replacement. After retiring from Microsoft in 2000, Maritz fomed Pi Corporation to focus on cloud-based solutions. Pi was bought by EMC in February.
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| Tuesday, July 8, 2008, 8:00 AM — by Rob DeFrancesco, TechStock Radar |
| VeriSign Trading Update |
VeriSign (VRSN, $33.25) fell 9.5% yesterday on huge volume of 21 million shares, closing just above April support at $32.87. The stock should be able to stabilize in the $31 to $32 range, which is where it held earlier this year. The RSI is falling from 28.1. On a rebound, VeriSign shares will fill yesterday’s gap on the price chart at $36.40.
For more on VeriSign, see TechStock Radar--July 3, 2008.
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| Tuesday, July 8, 2008, 7:18 AM — by Rob DeFrancesco, TechStock Radar |
| SSD Technology: Too Much Hype? |
Don’t expect Fujitsu in the solid-state hard drive (SSD) market anytime soon. The company’s VP of business development says flash-drive technology is still in its early stages and that its capabilities have been overstated. He points out that SSDs in laptops don’t save enough energy to make the technology worthwhile at this point.
Consumers have already figured this out: Apple was forced to slash the price of its SSD-equipped MacBook Air by $500.
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| Monday, July 7, 2008, 7:26 PM — by Rob DeFrancesco, TechStock Radar |
| Sourcefire Trends Down After Rejecting Buyout |
Sourcefire (FIRE, $7.23) shares are now 12% below the $8.25-a-share bid from privately held Barracuda Networks that was rejected at the end of June.
The company releases Q2 results on July 31. Management at that time needs to list the reasons why Sourcefire should remain independent. Newly appointed CEO John Burris has his work cut out for him to get the stock back to its 52-week high of $14.76.
For more on Sourcefire, see TechStock Radar—July 1.
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| Monday, July 7, 2008, 4:23 PM — by Rob DeFrancesco, TechStock Radar |
| Cypress Semi: Mason Capital Ups Stake to 5.4% |
Since the end of March, Mason Capital Management increased its position in Cypress Semiconductor (CY, $23.08) to 8.17 million shares from 1.935 million shares.
The firm, with 5.4% of the outstanding shares, is now one of the five largest Cypress holders.
The stock rallied to $31.35 on May 19 before pulling back 30% from the high. Cypress trades at 15.8 times the 2009 consensus EPS estimate of $1.46.
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| Monday, July 7, 2008, 12:27 PM — by Rob DeFrancesco, TechStock Radar |
| NETGEAR: Royce Ups Stake to 10.76% |
In an SEC filing today, Royce & Associates discloses that it has increased its stake in NETGEAR (NTGR, $13.37), a provider of wireless-networking hardware, to 10.76%.
The firm now owns 3.802 million shares, up from 2.387 million shares at the end of March. Royce bought 909,600 shares in Q1 (when NETGEAR traded as low as $18.58), so there’s some averaging down going on here.
NETGEAR shares have dropped more than 62% YTD on concerns about a price war with Cisco’s Linksys unit in the home-networking space. In Q1, NETGEAR’s gross margin dipped to 32.9% from 34.7% in the year-ago period and the company missed the consensus EPS estimate by four cents. Revenue of $198.2 million was up 14%, but fell short of the consensus of $198.8 million.
NETGEAR’s market cap has fallen to $473 million. The company has no debt and $200.8 million in cash.
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| Monday, July 7, 2008, 11:33 AM — by Rob DeFrancesco, TechStock Radar |
| VeriSign Off 6% on CEO Departure |
The market doesn’t like to be shocked ahead of a long holiday weekend. VeriSign (VRSN, $34.53) shares are down 6% this morning on heavy volume of more than 9 million shares following Thursday's news of the CEO’s departure.
For more on VeriSign, see TechStock Radar—July 3, 2008.
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| Monday, July 7, 2008, 10:46 AM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion: Risk/Reward Analysis |
Research in Motion (RIMM, $118.18) is trying to hold above the 200-day moving average at $113.65. The RSI has stabilized at 37.8.
For the latest risk/reward analysis for RIM shares, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Monday, July 7, 2008, 9:22 AM — by Rob DeFrancesco, TechStock Radar |
| Microsoft Still Open to Yahoo Deal |
Here's a statement from Microsoft (MSFT, $25.98) in response to Carl Icahn's Open Letter to Yahoo Shareholders.
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| Monday, July 7, 2008, 8:52 AM — by Rob DeFrancesco, TechStock Radar |
| Intuitive Surgical: ThinkPanmure Sees $360 |
Intuitive Surgical (ISRG, $250.34) shares have dropped 30% from the April high of $357.98 on concerns that a pullback in hospital spending would hurt sales of the company’s da Vinci robotic surgery system.
ThinkPanmure thinks the sell-off has been overdone and upgrades the stock to ‘Buy’ with a price target of $360.
Intuitive Surgical trades at 49 times the 2008 consensus EPS estimate of $5.06, above the expected growth rate of 37%.
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| Monday, July 7, 2008, 7:45 AM — by Rob DeFrancesco, TechStock Radar |
| ON Semi: FBR Bullish Ahead of Q2 Results |
FBR is out with positive comments on ON Semiconductor (ONNN, $9.22), saying Q2 tracked at the high end of guidance. The Q2 consensus revenue estimate is $552.4 million. For Q3, the firm sees revenue of $560 million to $575 million, vs. the consensus of $567.9 million. FBR points out ON trades at just 11 times the 2008 consensus EPS estimate of 82 cents.
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| Sunday, July 6, 2008, 11:00 AM — by Rob DeFrancesco, TechStock Radar |
| IAC/InterActiveCorp Deal Watch |
Shares of IAC/InterActiveCorp (IACI, $18.08) fell to a 52-week low last week and are down 33% YTD ahead of the big spin-off planned for August.
The four units set to be spun off: HSN, Ticketmaster, Interval International and Lending Tree. The Ask.com and Match.com businesses will remain under the IAC unit, which will focus on various Web opportunities.
As part of the spin-off process, IAC will take in $1.53 billion in dividends from three of its four units, including about $750 million from Ticketmaster. The actual net amount will be smaller because IAC will make a payment to the troubled Lending Tree unit prior to the spin off.
Last week, IAC completed its acquisition of Dictionary.com.
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| Sunday, July 6, 2008, 9:37 AM — by Rob DeFrancesco, TechStock Radar |
| GSI Commerce -26% From June High |
GSI Commerce (GSIC, $12.35) shares dropped 13.6% last week thanks in part to a negative WSJ article that said the stock is way too expensive given its exposure to the retailing segment. GSI Commerce helps traditional retailers build e-commerce platforms.
The article misses the point that retailers during these tough times are turning to e-commerce initiatives for growth. And penny-pinching consumers are using the Web to easily comparison shop for the best deals.
Check out this article from IBD on how some retailers are moving away from Amazon.com’s e-commerce platform.
GSI Commerce shares have recovered from the March low of $9.54, but are off 25.7% from the June high of $16.63.
For more on GSI Commerce, see TechStock Radar—June 27, 2008.
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| Saturday, July 5, 2008, 11:01 AM — by Rob DeFrancesco, TechStock Radar |
| Microsoft Even Cheaper |
After falling 6% last week, Microsoft (MSFT, $25.98) trades at just 12 times the fiscal 2009 (June) consensus EPS estimate of $2.16, below the expected growth rate of 14%.
Microsoft holds its analyst meeting on July 24 after releasing fiscal Q4 results on July 17.
For more on Microsoft, see TechStock Radar—July 2, 2008.
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| Saturday, July 5, 2008, 10:14 AM — by Rob DeFrancesco, TechStock Radar |
| First Solar: Estimates On The Rise |
First Solar (FSLR, $253.65) continues to try to grow into its valuation. The stock, which is down 5% YTD, trades at 86 times the 2008 consensus EPS estimate of $2.96 and 43.5 times the 2009 estimate of $5.83. In February, the ’09 consensus estimate stood at $4.87.
Lehman Brother in June raised its price target to $335 from $280 and increased its 2009 EPS estimate to $7.20 from $6.00 on ramping capacity in Malaysia. The high estimate for ’09 is $7.61.
For the March quarter, revenue rose 194% to $196.9 million, well above the consensus estimate of $183.6 million. Per-share earnings of 57 cents topped the consensus by 10 cents. The Q2 consensus numbers: EPS of 58 cents on revenue of $216.7 million.
In Q1, Vinik Asset Management increased its First Solar position by 65% with the purchase of 286,844 shares. The firm now holds 723,744 shares and counts First Solar among its 10 largest positions.
Zevenbergen Capital owns 681,920 shares and counts First Solar as its #1 holding.
Jennison Associates was the biggest buyer in Q1, picking up 1.077 million shares. The firm, now the #2 investor in First Solar, owns 2.813 million shares.
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| Friday, July 4, 2008, 9:50 AM — by Rob DeFrancesco, TechStock Radar |
| NVIDIA: Friess Associates' Savvy Sale |
In Q1, Friess Associates sold all of its 8.708 million shares of NVIDIA (NVDA, $12.49), missing yesterday’s 30% plunge in the stock.
Friess put some of the NVIDIA money to work in new tech positions in Check Point Software, Microsoft, Celgene and CyberSource. For more on Celgene, which is up 9.9% since the end of March, Tech-Stock Prospector subscribers should see this week’s Rob’s Journal.
Other firms that totally cleared out of big NVIDIA positions in Q1: Jennison Associates, Cadence Capital Management, Turner Investment Partners and Vinik Asset Management.
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| Friday, July 4, 2008, 8:33 AM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com -26% From May High |
As expected, Priceline.com (PCLN, $106.74) this week pulled back to support at $106 after taking out support at $120. The stock, which has fallen below its 200-day moving average of $112.86, will try to consolidate around current levels after a five-wave downside move from the May high at $144.34. However, a close below $106 sets up downside risk to around $93 from February.
For more on Priceline.com, see TechStock Radar—July 1, 2008.
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| Thursday, July 3, 2008, 5:00 PM — by Rob DeFrancesco, TechStock Radar |
| VeriSign: CEO William Roper Out |
After the close, VeriSign (VRSN, $36.74) announces that CEO William Roper resigned voluntarily on June 30. VeriSign founder and initial CEO Jim Bidzos replaces him on an interim basis. The company has an acting CFO at this point as well.
It’s a little strange that Roper is out because he was the one who led VeriSign’s divestiture strategy over the past year. Roper also improved the company’s capital structure with the repurchase of more than 28% of the outstanding shares.
Why not keep Roper around while VeriSign looked for a new CEO? And why did VeriSign wait until after the close ahead of the July 4th holiday to release this news if Roper stepped down on Monday?
The company would not give any detailed information. On the conference call, it was repeated several times (in response to analyst questions) that Roper left on his own. There was a lot of talk about a ‘tipping point’ in the company’s execution, which sounded like a bunch of mumbo jumbo. Jim Bidzos did his best to get the point across that he has been quite ‘engaged’ with VeriSign over the past few months.
Bidzos emphasizes that VeriSign is on track to divest all non-core operations and expects that most sales transactions would be substantially completed this year.
There’s been some speculation that VeriSign is slimming down to be sold. But VeriSign could be on the acquisition hunt itself. Bidzos did say on the call that he doesn’t expect ‘a sudden ramp-up’ in M&A in the near future.
VeriSign expects Q2 revenue to meet or beat the consensus estimate of $231.39 million. The company didn’t say anything about Q2 earnings; the consensus EPS estimate stands at 23 cents. VeriSign reports results for the June quarter on August 6.
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| Thursday, July 3, 2008, 1:57 PM — by Rob DeFrancesco, TechStock Radar |
| Research in Motion vs. Apple |
Apple (AAPL, $170.12) manages to finish the week with a tiny gain, while Research in Motion (RIMM, $115.04) loses 4.9%. RIM today barely held Tuesday’s low of $113.72.
For more on Apple, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Thursday, July 3, 2008, 11:52 AM — by Rob DeFrancesco, TechStock Radar |
| NVIDIA: OpCo Sees Rebound Potential |
With the stock down 30% today, Oppenheimer goes out on a limb this morning and upgrades NVIDIA (NVDA, $12.60) to ‘Outperform’ with a price target of $18.
The firm says now is the time to start building positions in this quality name for the long term.
For more on NVIDIA’s downside risk, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Thursday, July 3, 2008, 9:26 AM — by Rob DeFrancesco, TechStock Radar |
| Zoran Buyout Chatter Quiets |
The rumor yesterday about NVIDIA (NVDA, $13.15 pre market) possibly buying Zoran (ZRAN, $11.64) looks a little foolish now. NVIDIA needs to concentrate on getting its own house in order before thinking about making any acquisitions.
Thomas Weisel today reduces its price target on Zoran to $13 from $17 because of weakness in the company’s DVD and digital-camera units.
For more on Zoran, see yesterday’s TechStock Radar.
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| Thursday, July 3, 2008, 8:23 AM — by Rob DeFrancesco, TechStock Radar |
| Google Estimates Up |
Earnings estimates for Google (GOOG, $527.04) are on the rise, with the 2008 consensus up to $20.14 from $20.12 last week and $20.11 at the start of June. Over the past month, the 2009 consensus EPS estimate has risen to $24.77 from $24.69.
For now, the stock continues to hold above $520 support on a closing basis.
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| Thursday, July 3, 2008, 7:55 AM — by Rob DeFrancesco, TechStock Radar |
| NVIDIA: Goldman Cuts Target to $16 from $30 |
After starting coverage of graphics chipmaker NVIDIA (NVDA, $14.00 pre market) in early June with a ‘Buy' rating and $30 price target, Goldman lowers its target to $16 following last night’s negative fiscal Q2 preannouncement. The stock is down about 42% since June 4.
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| Wednesday, July 2, 2008, 5:50 PM — by Rob DeFrancesco, TechStock Radar |
| NVIDIA Slammed |
NVIDIA (NVDA, $13.45 after hours) shares are getting walloped after hours (-25%) following a negative fiscal Q2 preannouncement.
I’ve been watching NVIDIA shares to try to find a good entry point. Given the beat down on tap for tomorrow, NVIDIA could be setting up as a prime vulture investment.
For details, Tech-Stock Prospector subscribers should see today’s Rob’s Journal.
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| Wednesday, July 2, 2008, 4:33 PM — by Rob DeFrancesco, TechStock Radar |
| Take-Two Interactive Drifts Down |
Take-Two Interactive (TTWO, $24.34) shares fell 3.2% today and now trade more than 5% below EA’s takeover offer of $25.74 a share. EA must be quite happy that Take-Two shares are well off the June high of $27.95.
For more on Take-Two, see TechStock Radar—June 17, 2008.
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| Wednesday, July 2, 2008, 3:30 PM — by Rob DeFrancesco, TechStock Radar |
| Microsoft at Critical Support Levels |
Microsoft (MSFT, $26.24) has taken out its March low of $26.87. The stock is sitting at critical support dating back to March 2007. A significant break could take Microsoft down to the $21 to $22 area.
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| Wednesday, July 2, 2008, 2:36 PM — by Rob DeFrancesco, TechStock Radar |
| Zoran: Buyout Target? |
There’s chatter that Zoran (ZRAN, $11.98), a provider of digital-video chips, could be an acquisition target for NVIDIA (NVDA, $18.40). Zoran shares are down 56% from the 52-week high of $27.45 and off 47% so far this year.
Given Zoran’s revenue mix by product line, this would be an odd buyout target for NVIDIA, which has enough problems right now battling it out with AMD and Intel in the GPU market.
Here’s Zoran’s latest revenue breakdown:
*Digital cameras—27%
*DTV—25%
*DVD—21%
*Printer imaging—19%
*Mobile-phone processors—7%
In early June, ThinkPanmure started coverage of Zoran with an ‘Accumulate’ rating and a price target of $18 based on new design wins for the company’s DTV SupraHD processors. The stock is down nearly 20% since the recommendation.
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| Wednesday, July 2, 2008, 1:05 PM — by Rob DeFrancesco, TechStock Radar |
| SanDisk Bounces Off 52-week Low |
After dropping to a 52-week low of $17.18 yesterday, SanDisk (SNDK, $18.86) shares are up 7% today on hopes of some tightening in the supply of NAND flash memory thanks to strong demand from Apple. There are some indications that NAND spot pricing has firmed over the past few days. Since the beginning of May, SanDisk’s 2009 consensus EPS estimate has trended down to $1.81 from $1.87.
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| Wednesday, July 2, 2008, 7:12 AM — by Rob DeFrancesco, TechStock Radar |
| Google: Jefferies Sees $600 |
Google (GOOG, $534.73) should have a strong Q2, according to Jefferies. The firm says Google’s paid-click business was particularly robust in April and May. Google reports results for the June quarter on July 17. The consensus numbers: EPS of $4.72 on revenue of $3.86 billion. Jefferies maintains its price target of $600.
For more on Google, see yesterday’s TechStock Radar.
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| Wednesday, July 2, 2008, 7:02 AM — by Rob DeFrancesco, TechStock Radar |
| ON Semi Ready for Breakout? |
ON Semiconductor (ONNN, $9.72) rallied 6% yesterday on active volume of 14.49 million shares, 30% above average daily volume). ON is back above the 50-day moving average at $9.08 and just below short-term resistance around $9.75. A close above $10.09 gets the stock out of the recent trading range.
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| Tuesday, July 1, 2008, 7:33 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Slider iPhone? |
According to CNET, Apple (AAPL, $174.68) has shown iPhone prototypes with slider keyboards to wireless executives.
This version of the iPhone, if it's real, clearly would be aimed at the enterprise world, which still loves a keyboard. Check out the CNET article here.
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| Tuesday, July 1, 2008, 4:28 PM — by Rob DeFrancesco, TechStock Radar |
| Celgene Pops 8.4% on Volume Spike |
Celgene (CELG, $69.26) finished up 8.4% on massive volume of 18.17 million shares, 4.6X average daily volume. This was the highest close since October 24, 2007 and today’s move fills the gap on the price chart from October 25 at $68.47.
For details, Tech-Stock Prospector subscribers should see today's Rob's Journal and TSP #87 (Letter from Rob)--March 2008.
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| Tuesday, July 1, 2008, 3:30 PM — by Rob DeFrancesco, TechStock Radar |
| ComScore vs. Google Ad Planner |
ComScore (SCOR, $21.41) shares are trading just below the June 24 close of $21.45. That’s the day the stock dropped 22.5% on news of Google’s new Ad Planner, a free service for media planning and audience measurement.
According to this Mediaweek article, ComScore doesn’t have too much to worry about when it comes to Ad Planner.
For more on ComScore, see TechStock Radar—June 25, 2008.
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| Tuesday, July 1, 2008, 3:13 PM — by Rob DeFrancesco, TechStock Radar |
| Google Rebounds |
Google (GOOG, $532.33) recovered nicely from its morning low of $517, which held Friday’s low of $515.09. The stock continues to hold above $520 on a closing basis, which is a positive sign. However, Google needs to close above the 50-day moving average of $563.67 to indicate the recent failure at the 200-day moving average at $576 wasn’t the start of a significant retreat.
For more on Google, see yesterday’s TechStock Radar.
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| Tuesday, July 1, 2008, 12:45 PM — by Rob DeFrancesco, TechStock Radar |
| Sourcefire Dips After Rejecting Offer |
Sourcefire (FIRE, $7.46) shares are now trading 9.6% below the $8.25-a-share bid from Barracuda Networks. Sourcefire last week rejected the higher offer (the first one was $7.50 a share), saying it substantially undervalues the company and is not in the best interest of shareholders. Privately held Barracuda should come back now with a slightly higher offer.
For more on Sourcefire, see TechStock Radar—June 25, 2008.
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| Tuesday, July 1, 2008, 12:10 PM — by Rob DeFrancesco, TechStock Radar |
| Apple Trading Update |
For the latest trading update on Apple (AAPL, $171.37), Tech-Stock Prospector subscribers should see today's Rob's Journal.
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| Tuesday, July 1, 2008, 10:53 AM — by Rob DeFrancesco, TechStock Radar |
| Atheros Holds 200-day Moving Average |
Atheros Communications (ATHR, $31.85) held its 200-day moving average of $28.25 on the recent pullback. The stock, which has rebounded from last week’s low of $28.50, is now stabilizing around its 50-day moving average of $30.28. The RSI is rising from 49.6.
For more on Atheros, see TechStock Radar—June 24, 2008.
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| Tuesday, July 1, 2008, 7:23 AM — by Rob DeFrancesco, TechStock Radar |
| Priceline.com Breaks Support |
Priceline.com (PCLN, $115.46) dropped 7.7% yesterday on heavy volume of 3.35 million shares, 142% above average daily volume. With the stock taking out support at $120, there’s now downside risk to $106. The 200-day moving average stands at $112.53.
For more on Priceline.com, see yesterday's TechStock Radar.
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