As oil nears $50, some investors fret that a new round of production could begin, undermining the nascent recovery. Not so, say Guggenheim’s Subash Chandra and Marshall Coltrain, who expect good things from WPX Energy (WPX), Devon Energy (DVN) and Continental Resources (CLR). They explain why:
Agence France-Presse/Getty Images
As oil approaches $50, we believe oil supply and drilling activity will be slow to respond. The de-levering theme is still predominant, in our view…The first phase was to reduce or eliminate bank debt through equity raises and asset sales. That has largely concluded. The new phase could distract more capital and last longer. Most companies we spoke to are intent on reducing rather than refinancing long-term debt obligations. The recent cycle set back growth strategies depending on leverage and high commodity prices. The new goal may be to put the capital structure ahead of growth to create more viable, robust institutions. Near-term debt maturities are in the crosshairs and 2019 or 2020 arent far off…
Top 10 Recreation Stocks For 2016: Cummins Inc.(CMI)
Cummins Inc. designs, manufactures, distributes, and services diesel and natural gas engines, electric power generation systems, and engine-related component products worldwide. It operates in four segments: Engine, Power Generation, Components, and Distribution. The Engine segment offers a range of diesel and natural gas powered engines under the Cummins and other customer brand names for the heavy-and medium-duty truck, bus, recreational vehicle, light-duty automotive, agricultural, construction, mining, marine, oil and gas, rail, and governmental equipment markets. This segment also provides new parts and service, as well as remanufactured parts and engines. The Power Generation segment offers power generation systems, components, and services, including diesel, natural gas, gasoline, and alternative-fuel electrical generator sets for use in recreational vehicles, commercial vehicles, recreational marine applications, and home stand-by or residential applications. This segment also provides components that make up power generation systems, such as engines, controls, alternators, transfer switches, and switchgears. The Components segment supplies filtration products, turbochargers, aftertreatment systems, intake and exhaust systems, and fuel systems for commercial diesel applications. This segment offers filtration and exhaust systems for on-and off-highway heavy-duty and mid-range equipment, as well as supplies filtration products for industrial and passenger car applications. This segment also develops after treatment and exhaust systems to help customers meet emissions standards and fuel systems. The Distribution segment provides parts and services, as well as service solutions, including maintenance contracts, engineering services, and integrated products. The company sells its products to original equipment manufacturers, distributors, and other customers. Cummins Inc. was founded in 1919 and is headquartered in Columbus, Indiana.
- [By Michael Flannelly]
Early on Wednesday, analysts at both UBS and BMO Capital raised their price targets and earnings estimates on diesel engines manufacturer Cummins Inc. (CMI).
The analysts at UBS raised the numbers on CMI to reflect better growth from market positions and new products. As such, they now see shares of CMI reaching $146, which suggests a 10.6% upside to the stock’s Tuesday closing price of $131.96.
At BMO Capital, the analysts raised CMI’s earnings estimates through 2015 as distribution acquisitions should add to earnings. Furthermore, the analysts rate CMI as “Outperform” and see shares reaching $146 as well.
Cummins shares were down 20 cents, or 0.15%, during pre-market trading on Wednesday. The stock is up 21.79% year-to-date.
- [By Michael Flannelly]
Diesel Engines maker Cummins Inc. (CMI) had its price target and earnings estimates raised by analysts at Jefferies on Thursday, following a positive analyst day.
The analysts rate CMI as “Hold” and now see shares reaching $130, which suggests a slight downside to the stock’s Wednesday closing price of $133.72.
Cummins shares were up 46 cents, or 0.34%, during morning trading on Thursday. The stock is up 23.51% year-to-date.
Top 10 Recreation Stocks For 2016: Newfield Exploration Company(NFX)
Newfield Exploration Company, an independent energy company, engages in the exploration, development, and production of crude oil, natural gas, and natural gas liquids in the United States. Its principal areas of operation include the Anadarko and Arkoma basins of Oklahoma, the Williston Basin of North Dakota, the Uinta Basin of Utah, and the Maverick and Gulf Coast basins of Texas. The company also holds offshore oil developments in China. As of December 31, 2015, it had proved reserves of approximately 509 million barrels of oil equivalent. The company was founded in 1988 and is headquartered in The Woodlands, Texas.
- [By Ben Levisohn]
Lear also sees strong “upside potential” forConcho Resources (CXO), Pioneer Natural Resources (PXD) and Newfield Exploration (NFX) as well performance improves in the Permian/STACK, and also writes positively on Devon Energy (DVN).
- [By Ben Levisohn]
The large cap E&Ps we cover raised ~ $6.5 billion of equity in 2015 and are likely to consider additional issuance in 2016. Pioneer Natural Resources (PXD) raised $1.3 billion on January 5th and Hess Corp. (HES) raised $1.5 billion of equity/equity-linked earlier this month. We think highly leveraged companies such as Devon Energy,Encana andRange Resources (RRC) and companies with a large deficit (before asset sales), such asAnadarko Petroleum and Devon Energy, are most likely to consider raising equity. Additionally, we believe companies such as WPX Energy (WPX), Southwestern Energy (SWN), Marathon Oil, Continental Resources (CLR),Noble Energy and Newfield Exploration (NFX) could issue equity while several levered companies may be unwilling or unable to access equity markets. We do not think Apache, Canadian Natural Resource, EOG Resources (EOG), Occidental Petroleum orPioneer Natural Resources are likely to issue equity this year.
Hot Integrated Utility Stocks To Watch For 2016: Medidata Solutions, Inc.(MDSO)
Medidata Solutions, Inc. provides cloud-based clinical development solutions for life sciences in the United States and internationally. The company offers applications and data analytics for clinical development. It offers Medidata Rave, a platform for capturing, managing, and reporting clinical data; Medidata CTMS, a clinical trial management solution that streamlines operational workflows; Medidata Designer, which enhances the efficiency of clinical trial start-up; Medidata Insights, a clinical business analytics platform; and Medidata Balance, a randomization and trial supply management solution. The company also provides Medidata Patient Cloud application for electronic patient-reported outcome; Medidata Grants Manager, which enables to develop and manage trial budgets; Medidata contract research organization (CRO) Contractor, an analytical tool for CRO outsourcing, budgeting, and negotiation; and Medidata SQM, a set of c loud-based site quality management dashboards. In addition, it offers Medidata Coder that provides medical coding and synonym management solutions; Medidata Safety Gateway, which offers a solution for collecting and transmitting adverse events and related data from the EDC system; and Medidata Targeted SDV that provides auditable and scalable solutions, as well as offers hosting, support, and professional services. Medidata Solutions, Inc. markets and sells its cloud-based solutions through direct sales force, as well as through relationships with CROs and other strategic partners. The company serves pharmaceutical, biotechnology, medical device, and diagnostics companies; and academic institutions, contract research organizations, and other entities engaged in clinical trials. Medidata Solutions, Inc. was founded in 1999 and is headquartered in New York, New York.
- [By Lisa Levin]
On Wednesday, technology shares climbed by 0.94 percent. Top gainers in the sector included Marvell Technology Group Ltd. (NASDAQ: MRVL) and Medidata Solutions Inc (NASDAQ: MDSO).
Top 10 Recreation Stocks For 2016: Lowe’s Companies Inc.(LOW)
Lowe’s Companies, Inc., together with its subsidiaries, operates as a home improvement retailer in the United States, Canada, and Mexico. The company offers a range of products for maintenance, repair, remodeling, home decorating, and property maintenance. It provides home improvement products in the categories of appliances, lumber, paint, millwork, building materials, lawn and landscape products, flooring, rough plumbing, seasonal living, tools, hardware, fashion plumbing, lighting, nursery, outdoor power equipment, cabinets and countertops, home organization, rough electrical, and home fashion, as well as boards, panel products, irrigation pipes, vinyl sidings, and ladders. The company also offers installation services through independent contractors in various product categories. Lowe’s Companies serves homeowners and renters primarily consisting of do-it-yourself customers and do-it-for-me customers; and commercial business customers, who work in the construction, rep air/remodel, commercial and residential property management, or business maintenance professions. As of August 15, 2011, it operated approximately 1,725 home improvement stores in the United States, Canada, and Mexico. The company also offers its products through electronic product catalogs and Lowes.com. Lowe’s Companies, Inc. was founded in 1952 and is based in Mooresville, North Carolina.
- [By Ben Levisohn]
Shares of Lowe’s (LOW) are up more than 3% following its better-than-forecast earnings today–and some of its numbers were even better than Home Depot’s (HD). Credit Suisse analysts Seth Sigman and Kieran McGrath explain:
Matt Rourke/Associated Press
Lowe’s delivered a significant top line beat (+7.5% US comps), along with a modest EPS beat ($0.02). It outperformedHome Depot (though its quarter may have captured a more favorable period see more on that below). EPS upside was limited by lower gross margin and less flow through. Guidance was left unchanged. Adding it all up, we think strong top line results and 24% EPS growth should be enough send the stock up today, serving as another reminder of the strength of this category andLowe’s opportunity…
Lowe’s US comps of 7.5% came in well above our and the markets expectation, of 4-5% afterHome Depot yesterday. This is a very strong result, accelerating from +5.5% in Q4, both on a one- and two-year basis, and we give a lot of credit to the team for strong execution in the quarter. As noted above, limiting EPS upside was gross margin (-44 bps vs. expectations for up slightly), and lower flow through than expected (10 bps of EBIT expansion for every point of comps above 1%), particularly given thatLowe’s was no longer incurring costs to operate in Australia. However, we believe the company has discussed more of a back-end weighting to its margin expansion, due to mix and promotional cadence. This seems consistent.
There will likely be some focus on the comps gap withHome Depot today, asLowe’s outperformed in the US (well ahead of our expectations for the gap to remain wide at 250+ bps). One difference to note forLowe’s vs.Home Depot is the calendar;Lowe’s quarter captured the last weekend in January, but not the last weekend in April. We are not sure how meaningful that is, but given that April was the wea
Top 10 Recreation Stocks For 2016: Finisar Corporation(FNSR)
Finisar Corporation provides optical subsystems and components for data communication and telecommunication applications in the United States, Malaysia, China, and internationally. Its optical subsystems primarily consist of transmitters, receivers, transceivers, transponders, and active optical cables that provide the fundamental optical-electrical or optoelectronic interface for interconnecting the electronic equipment used in communication networks, including the switches, routers, and servers used in wireline networks, as well as the antennas and base stations used in wireless networks. The company also offers wavelength selective switches, which are used to switch network traffic from one optical fiber to multiple other fibers without converting to an electronic signal. In addition, it provides optical components comprising packaged lasers, receivers, and photodetectors for data communication and telecommunication applica tions; and passive optical components for telecommunication applications. Finisar Corporation markets its products through its direct sales force, as well as through a network of distributors and manufacturers representatives to the original equipment manufacturers of storage systems, networking equipment, and telecommunication equipment, as well as to their contract manufacturers. Finisar Corporation was founded in 1987 and is headquartered in Sunnyvale, California.
- [By Renu Singh]
Finisar’s (FNSR) datacom segment generated $184.4 million in revenue in the last reported quarter. This was a sequential growth of 9.3%. The Ten Gigabit Ethernet or 10GbE modules contributed about 40% to the datacom segment’s revenue. As organizations go digital, there are an increasing number of applications that require considerable bandwidth to support the transfer of large data, video, and audio files across networks. Using 10GbE optical links provides sufficient bandwidth to support these bandwidth-intensive applications at a lower cost.
- [By Lisa Levin]
Finisar Corporation (NASDAQ: FNSR) shares were also up, gaining 18 percent to $16.70 after the company reported upbeat Q3 earnings.
Equities Trading DOWN
Top 10 Recreation Stocks For 2016: Valhi Inc.(VHI)
Valhi, Inc., through its subsidiaries, operates in the chemicals, component products, and waste management businesses. Its Chemicals segment produces and markets titanium dioxide pigment, a white inorganic pigment used to impart whiteness, brightness, and opacity for applications, such as coatings, plastics and paper, inks, food, and cosmetics. It also mines ilmenite in Norway. The company?s Component Products segment manufactures mechanical and electrical cabinet locks and other locking mechanisms, including disc tumbler locks, pin tumbler locking mechanisms, and electronic locks for the postal, transportation, furniture, banking, vending, general cabinetry, and other industries. Its security products are used in various applications, including ignition systems, mailboxes, file cabinets, desk drawers, tool storage cabinets, vending and gaming machines, high security medical cabinetry, electrical circuit panels, storage compartments, gas station security, bank bags, and p arking meters. It also provides furniture components comprising precision ball bearing slides and ergonomic computer support systems for use in applications, such as file cabinets, desk drawers, computer related equipment, home appliances, tool storage cabinets, imaging equipment, and automated teller machines. In addition, this segment manufactures and distributes stainless steel exhaust components, gauges, throttle controls, hardware, and accessories primarily for performance boats. Valhi?s Waste Management segment engages in processing, treating, storing, and disposing hazardous, toxic, and low-level radioactive wastes. This segment serves chemical, aerospace, and electronics businesses, as well as governmental agencies. Valhi also offers insurance brokerage and risk management services; holds marketable securities; provides utility services; and owns and develops properties. The company was founded in 1932 and is based in Dallas, Texas. Valhi, Inc. is a subsidiary of Co ntran Corporation.
- [By Lisa Levin]
In trading on Thursday, basic materials shares slipped by 0.61 percent. Meanwhile, top losers in the sector included Valhi, Inc. (NYSE: VHI), down 13 percent, and LSB Industries, Inc. (NYSE: LXU), down 7 percent.
Top 10 Recreation Stocks For 2016: Sohu.com Inc.(SOHU)
Sohu.com Inc. provides online media, search, and game services on personal computers (PCs), mobile devices, and tablets in the Peoples Republic of China. It operates brand advertising business that offers advertisements on its Websites to companies; sohu.com, which provides online news and information; m.sohu.com mobile portal and Sohu News APP, a mobile phone application; tv.sohu.com, which offers online video service; and focus.cn that provides online real estate information. The companys search and search-related business provides Sogou Input Method software to input Chinese characters on PCs and mobile devices; Sogou browser; Sogou Web Directory, a Web directory navigation site for PCs; Sogou Search, a proprietary search engine; and Sogou Browser for PCs and mobile devices, as well as offers pay-for-click services and online marketing services for advertisers. In addition, its online game business offers interactive on line games, mobile games, and Web games for game players. Further, the companys platform channel business owns and operates various Web properties and software applications, including 17173.com, an information portal for game players; RaidCall, which provides online music and entertainment services; and the Dolphin Browser, a gateway to a host of user activities on mobile devices. Additionally, it provides mobile-related services and mobile products; Internet value-added services; and cinema advertising services. The company was formerly known as Internet Technologies China Incorporated and changed its name to Sohu.com Inc. in September 1999. Sohu.com Inc. was founded in 1996 and is headquartered in Beijing, the Peoples Republic of China.
- [By Lisa Levin]
Sohu.com (NASDAQ: SOHU) shares rose 2.77% to touch a new 52-week high of $71.54. Analysts at Goldman Sachs upgraded the stock from neutral to conviction buy.
Top 10 Recreation Stocks For 2016: 8×8 Inc(EGHT)
8×8, Inc. develops and markets telecommunications services for Internet protocol (IP), telephony, and video applications. The company offers 8×8 Virtual Office Business Telephone Service, an alternative to traditional private branch exchange systems that offers automated attendants to assist callers; extension-to-extension dialing services; direct inward dial; conference bridge, 3-way calling, music on hold, call park/pick-up, call transfer, hunt groups, and do not disturb services; voice mail, including email alerts and direct transfer to mailbox; call waiting/caller-ID; distinctive tone ringing; and optional receptionist console applications. Its products also include 8×8 Complete Contact Center, an integrated hosted call center solution that consists of skill-based routing, multi-media management, real time monitoring and reporting, voice recording and logging, historical reporting, interactive voice response, CRM integration, and contact and case management tools; 8×8 IP Telephones; 8×8 Virtual Meeting, a video Web conferencing service; and 8×8 Managed Hosting and Cloud-Based Computing Solutions. In addition, the company offers 8×8 Virtual Office Pro Unified Communications that allows subscribers to manage business communications functions online and delivers various tools, such as Microsoft Outlook contacts and corporate directory integration; virtual meeting; Virtual Office Mobile extension; fax; call recording; presence management; and a view of voicemails, recordings, FAX messages, calls, and chat history. The company markets its services under 8×8 brand to end users through direct sales force, Web site, and third party resellers primarily in the United States. As of June 30, 2011, it had approximately 25,000 business customers. 8×8, Inc. was founded in 1987 and is headquartered in Sunnyvale, California.
- [By Lisa Levin]
On Thursday, telecommunications services shares gained by 0.42 percent. Meanwhile, top gainers in the sector included 8×8, Inc. (NASDAQ: EGHT), up 4 percent, and NQ Mobile Inc (ADR) (NYSE: NQ), up 2 percent.
Top 10 Recreation Stocks For 2016: Investors Real Estate Trust(IRET)
Investors Real Estate Trust, a real estate investment trust (REIT), engages in the ownership and operation of income-producing real estate properties in the United States. It owns multi-family residential properties and commercial office, medical, industrial, and retail properties located primarily in the upper midwest states of Minnesota and North Dakota. As of April 30, 2008, the company operated a real estate portfolio of 72 multi-family residential; 65 office; 48 medical; 17 industrial; and 33 retail properties. Investors Real Estate Trust has elected to be taxed as a REIT under the Internal Revenue Code of 1986. As a REIT, the trust is not subject to federal corporate income taxes, if it distributes at least 90% of its taxable income to its shareholders. The company was founded in 1970 and is headquartered in Minot, North Dakota with additional offices in Minneapolis, Minnesota, and Omaha, Nebraska; and Kansas City, Kansas, and St. Louis, Missouri.
- [By Monica Gerson]
General Mills, Inc. (NYSE: GIS) is expected to report its quarterly earnings at $0.60 per share on revenue of $3.86 billion. Pier 1 Imports Inc (NYSE: PIR) is projected to post a quarterly loss at $0.05 per share on revenue of $420.05 million. Acuity Brands, Inc. (NYSE: AYI) is estimated to report its quarterly earnings at $2.03 per share on revenue of $847.79 million. Monsanto Company (NYSE: MON) is projected to report its quarterly earnings at $2.40 per share on revenue of $4.49 billion. Worthington Industries, Inc. (NYSE: WOR) is expected to report its quarterly earnings at $0.64 per share on revenue of $692.48 million. Progress Software Corporation (NASDAQ: PRGS) is projected to post its quarterly earnings at $0.29 per share on revenue of $94.64 million. UniFirst Corp (NYSE: UNF) is estimated to report its quarterly earnings at $1.34 per share on revenue of $366.28 million. Exfo Inc (NASDAQ: EXFO) is expected to post its quarterly earnings at $0.06 per share on revenue of $60.87 million. OMNOVA Solutions Inc. (NYSE: OMN) is projected to report its quarterly earnings at $0.14 per share on revenue of $205.40 million. 8Point3 Energy Partners LP (NASDAQ: CAFD) is estimated to post a quarterly loss at $0.01 per share on revenue of $11.60 million. Park Electrochemical Corp. (NYSE: PKE) is expected to report its quarterly earnings at $0.22 per share on revenue of $35.30 million. Xplore Technologies Corp. (NASDAQ: XPLR) is projected to post its quarterly earnings at $0.01 per share on revenue of $24.00 million. Investors Real Estate Trust (NYSE: IRET) is expected to post its quarterly earnings at $0.14 per share on revenue of $56.87 million. Tel-Instrument Electronics Corp. (NYSE: TIK) is estimated to post earnings for the latest quarter. Aethlon Medical, Inc. (NASDAQ: AEMD) is expected to post a quarterly loss at $0.20 per share. Ossen Innovation Co Ltd (ADR) (NASDAQ: OSN) is projected to post ea
Top 10 Recreation Stocks For 2016: Sony Corp Ord(SNE)
Sony Corporation designs, develops, manufactures, and sells electronic equipment, instruments, and devices for consumer, professional, and industrial markets worldwide. The company offers consumer products and devices, including televisions, video cameras, compact digital cameras and interchangeable single-lens cameras, Blu-ray Disc players/recorders, DVD-video players/recorders, home theaters and audio systems, and portable audio and car audio products. It also provides charged coupled devices, complementary metal-oxide semiconductor image sensors, system LSIs, small- and medium-sized LCD panels, and other semiconductors; and components, such as batteries, optical disk drives, chemical products, audio/video/data recording media, storage media, and optical pickups. In addition, the company develops, produces, markets, and distributes games, such as PlayStation3, PlayStation Portable, and PlayStation 2 hardware and related software; and PCs and flash memory digital audio pl ayers, as well as manufactures broadcast- and professional-use products, Blu-ray discs, DVDs, and CD discs. Further, it produces and distributes motion pictures and television programs, and home entertainment; creates and distributes digital content; operates television networks and studio facilities; and develops entertainment products, services, and technologies. Additionally, the company engages in the music publishing business, as well as provision of various financial services, including insurance, savings products, loans, and credit financing services; and a network service business and an advertising agency business. It also involves in research, development, design, production, marketing, sales, distribution, and servicing mobile phones, accessories, services, and applications. The company was formerly known as Tokyo Tsushin Kogyo Kabushiki Kaisha and changed its name to Sony Corporation in 1958. Sony Corporation was founded in 1946 and is based in Tokyo, Japan.
- [By Demitrios Kalogeropoulos]
Don’t write offNintendo’s (NASDAQOTH: NTDOY ) chances for a strong holiday season just yet. Yes, even with a year’s head start, the company’s next-generation Wii U has been badly trailing sales of current-gen consoles from Microsoft (NASDAQ: MSFT ) andSony (NYSE: SNE ) . But that could be set to change soon.
- [By Brian Stelter]
Other companies, including Dish Network (DISH) and Sony (SNE), are already selling a cable-like bundle of channels via the Internet, but the prospect of Apple has garnered an outsized amount of attention.
- [By Christopher Freeburn]
Here are four things to know about Grand Theft Auto V:
It is available for both Sony‘s (SNE) Playstation 3 and Microsoft‘s (MSFT) Xbox 360 consoles. It is set in a fictionalized urban landscape based on Los Angeles. It offers three main characters, unlike prior editions, which focused on one. Rockstar Games will launch an online version — Grand Theft Auto Online — next month.
Nintendo Still Wont Make a Cash Grab for Mobile Games
Yesterday, Amazon (AMZN) said that it had sold out its pre-orders of Grand Theft Auto V for Xbox consoles, though some copies for the Playstation were still available.
- [By Manikandan Raman]
The Lazarus group has also been linked to the 2014 hack against Sony Corp (ADR) (NYSE: SNE).
However, the Philippines central bank’s deputy governor, Nestor Espenilla, had said “no bank in the country had lost money to hackers, although he did not rule out the possibility of cyber attacks,” Reuters reported.