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Boeing (BA - option chain) stock is trading lower today on conflicting reports about the company's timeline for the debut of its highly-anticipated, but much-delayed 787 Dreamliner. Aviation Week published a report late Friday that the company has told several customers that delivery of its 787 Dreamliner will be delayed by up to 10 months, but Boeing denies this report, saying it intends to meet the current delivery date of Q1 2011. If you think this stock won't be rising too far in the coming months, then it could be a good time to look at a bearish hedged play on BA.
Boeing Could Be Facing Even More 787 Delays
Continue reading Boeing Could Be Facing Even More 787 Delays
Analyst Calls: ARO, BA, BKE, DWA, MRVL, SGEN, TWC, WFR ...
Analyst Upgrades
- Time Warner Cable (TWC) was upgraded to outperform from market perform at Bernstein.
- Citigroup upgraded MEMC Electronic (WFR) and Skilled Healthcare (SKH) to buy from hold at Citigroup.
- Administaff (ASF) was upgraded to buy from hold at Roth Capital.
- The Buckle (BKE) was upgraded to buy from hold at KeyBanc.
- BofA/Merrill upgraded DreamWorks (DWA) to neutral from underperform.
- Corrections Corp. (CXW) was upgraded to buy from neutral at SunTrust.
- Marvell Technology (MRVL) was upgraded to positive from neutral at Susquehanna.
Continue reading Analyst Calls: ARO, BA, BKE, DWA, MRVL, SGEN, TWC, WFR ...
Chasing Value: Apple Does Not Need $50 Billion
Steve Jobs, the illustrious CEO and the heart and soul of Apple Inc. (AAPL) would have you believe that Apple cannot issue a dividend to shareholders because of the scary competitive business environment. He conveys to us that they need the money to overcome hardship and if the right opportunity comes along make key acquisitions.This is utter nonsense, a supreme untruth, wasted breadth and a failure to come to grips with reality. In the past quarter Apple increased its cash and short term investments to $50 billion as I wrote it would six weeks ago.
Apple currently has 914 million outstanding shares. With the stock trading around $300 per share, a 2% dividend yield would require $6 per share or, $5.5 billion dollars annually to cover the distribution.
Continue reading Chasing Value: Apple Does Not Need $50 Billion
Boeing Sees a Bid on Q3 Data
Boeing (BA) is taking advantage of the improved sentiment this afternoon. At the time of this writing, shares of the aerospace concern were higher by 3% to $71.16. Volume, however, wasn't yet above average (it will be, though, before the regular session is through). The 52-week low for the stock is $47.18, and the 52-week high is $76. The company is therefore in favor these days. The chart, while not reflective of a smooth uptrend, nevertheless shows an equity that has been doing okay given the volatility we've seen in recent months.
Options Update: Boeing Volatility Flat into EPS and Cash Flow Outlook
Boeing (BA) is expected to report Q3 EPS on October 20. November put option implied volatility is at 33, January is at 34, versus its 26-week average of 32, according to Track Data, suggesting non-directional near-term price movement. Wells Fargo (WFC) is reporting Q3 EPS on October 20. November put option implied volatility is at 43, January is at 40, versus its 26-week average of 36, according to Track Data, suggesting larger price movement.
Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.
Week in Preview: Return of the Earnings Crunch (AAPL, BA, HOG, LUV)
The earnings crunch is back on this week. Third quarter reports are due from tech, financial and pharmaceutical companies, from airlines and from many others. Here's a day-by-day rundown of the coming week's earnings highlights, with a closer look at Apple (AAPL), Harley-Davidson (HOG), Boeing (BA) and Southwest Airlines (LUV).
Getting things started on Monday, analysts surveyed by Thomson Reuters expect Citigroup (C), Halliburton (HAL) and IBM (IBM) to post year-over-year earnings growth. But Monday's highlight no doubt will be Apple's (AAPL) quarterly results.
Continue reading Week in Preview: Return of the Earnings Crunch (AAPL, BA, HOG, LUV)
Chasing Value: Scoping Out Defense Contractors -- Part 2
Yesterday I began a review of the five major U.S. defense contractors, searching for potential stock value. The group included General Dynamics (GD), Lockheed Martin (LMT), Boeing (BA), Northrop, Grumman (NOC) and Raytheon (RTN). After examining the P/E, PEG, P/CF, P/S, and P/B, Boeing did not make it through the screens.Today I continue the exercise, hoping to find a stock worthy of placing a bet.
Dividend Yield
- Lockheed Martin: 3.77%
- Raytheon Company: 3.16%
- Northrop, Grumman: 2.89%
- General Dynamics: 2.59%
Continue reading Chasing Value: Scoping Out Defense Contractors -- Part 2
Chasing Value: Scoping Out Defense Contractors -- Part 1
The defense sector is down, but don't count it out. We give lip service to the likelihood of defense being a target of budget hawks in Congress, but truth be told, the same fiscally conservative members are often the biggest supporters of defense.Equally important is that unlike many other industries, this is one tech sector that keeps most of its jobs at home and well-distributed through the country. This, too, preserves defense spending.
The major players in the industry after 20 years of consolidation are General Dynamics Corp (GD), Lockheed Martin (LMT), Boeing Co (BA), Northrop, Grumman (NOC), and Raytheon Company (RTN). In addition there are hundreds more making specialized parts in support of the majors and more still supplying basic elements like tires, wiring, computer processors, steel, aluminum, specialty glass, and ammunition. Then there are suppliers of manpower and smaller manufacturers producing unmanned aircraft drones and robots.
Continue reading Chasing Value: Scoping Out Defense Contractors -- Part 1
Closing Bell: The Market Advances Without Conviction (BA, YHOO)
The market ignored intervention on behalf of Japan to drive down the value of the yen and an anemic improvement in August industrial output, which was only up .2%, to post a very modest gain for the day. Today's closing bell numbers:
Dow Jones 10,572.73 +46.24 (0.44%)
S&P 500 1,125.07 +3.97 (0.35%)
Nasdaq 2,301.32 +11.55 (0.50%)
Continue reading Closing Bell: The Market Advances Without Conviction (BA, YHOO)
Analyst Calls: BA, COST, DELL, GD, INTC, LVS, MGM, PCLN, TWX, V, VIA ...
Analyst Upgrades
- Goldman upgraded Costco (COST) to buy from neutral based on valuation, improving fundamentals and potential catalysts. The firm raised its price target to $68 from $62.
- Soleil upgraded MGM Resorts (MGM) to buy from hold, citing valuation, easing balance sheet concerns and a multiyear convention recovery. The firm upped its target for shares to $14 from $13. Note, Soleil also downgraded Las Vegas Sands (LVS) to hold from buy.
- Piper Jaffray upgraded Phillips-Van Heusen (PVH) to overweight from neutral with a $59 price target following the company's better-than-expected Q2 results.
- Dell (DELL) was upgraded to buy from outperform at CLSA.
- CommScope (CTV) was upgraded to buy from neutral at UBS.
- EnCana (ECA) was upgraded to sector outperformer from sector performer at CIBC.
Continue reading Analyst Calls: BA, COST, DELL, GD, INTC, LVS, MGM, PCLN, TWX, V, VIA ...
Boeing Ready to Climb to Cruising Altitutde
Boeing Co. (BA) announced Friday that delivery of its 787 Dreamliner is going to be delayed until the middle of Q1 2011. This is disappointing news, but don't let it cloud your outlook on Boeing too much.
Goldman Sachs has Boeing on its conviction buy list and recently raised its earnings-per-share estimates for Q3 from $1.02 to $1.09 and for Q4 from $1.12 to $1.15. Goldman is also maintaining a price target of $84 for the stock, which is 37% higher than Boeing's current price of $61.
Continue reading Boeing Ready to Climb to Cruising Altitutde
Analyst Calls: ACI, BA, COP, CTXS, CVS, NGS, NVDA, VPRT, WSM ...
Analyst Upgrades
- BofA/Merrill upgraded ConocoPhillips (COP) to neutral from underperform following the better-than-expected Q2 report. The firm has a $61 price target on shares.
- Deutsche Bank upgraded Citrix Systems (CTXS) to buy from hold following the company's Q2 results and raised its target for shares to $65 from $45. Shares were also upgraded to neutral from underperform at Cowen following the better-than-expected Q2 report.
- Macquarie upgraded Arch Coal (ACI) to outperform from underperform and raised its price target to $29 from $23. The firm expects PRB priced to move higher given increased domestic and export demand combined with supply shortfalls.
- Boeing (BA) was upgraded to hold from sell at Societe Generale.
- Equinix (EQIX) was upgraded to outperform from perform at Oppenheimer.
- Williams-Sonoma (WSM) was upgraded to equal weight from underweight at Barclays.
Continue reading Analyst Calls: ACI, BA, COP, CTXS, CVS, NGS, NVDA, VPRT, WSM ...
Options Update: Barrick Gold Calls Active on Low Volatility into EPS; Gold Down 2%
Barrick Gold (ABX) closed down $1.72 to $40.03. ABX is expected to report Q2 EPS on July 29. Call option volume of 15,000 contracts compares to put volume of 2,000 contracts. Gold is recently down 2.01% to $1,163.10, according to Bloomberg. ABX weekly July 40 straddle is price at $1.30, October is at $4.82. August and January option implied volatility of 34 is near its 26-week average of 38 according to Track Data, suggesting decreasing price movement.Boeing (BA) reported a 21% drop in second-quarter earnings on Wednesday before the bell . BA August put option implied volatility is at 33, November and January is at 37, versus its 26-week average of 32, according to Track Data, suggesting non-directional near-term price movement.
Options Update is by Stock Specialist Paul Foster of theflyonthewall.com.
Analyst Calls: BA, MOT, AOL, AMZN, JNPR, IBM, LMT, PCLN, MFE
Analyst upgrades:
- Citigroup assumed coverage of Boeing (BA) and upgraded the stock to Buy from Hold due to its positive view on the aerospace cycle and valuation. The firm raised its target for shares to $80 from $73.
- Morgan Stanley upgraded Motorola (MOT) to Overweight from Underweight citing expectations for higher handset margins driven by Android. The analyst raised Android unit shipping estimates and earnings estimates. The firm raised its price target on shares to $9.75 from $8.75.
- Susquehanna upgraded SINA Corporation (SINA) to Positive from Neutral and has a $50 target on the stock. The firm said Sina'a Twitter like service called 'Sina Weibo' has seen exponential growth and will crate huge value for the company.
- AOL (AOL) was upgraded to Neutral from Underperform at Credit Suisse.
- Frontier Communications (FTR) was upgraded to Sector Perform from Underperform at RBC Capital and to Buy from Hold at Hudson Square.
- Canadian Solar (CSIQ) was upgraded to Outperform from Market Perform at Wells Fargo.
Continue reading Analyst Calls: BA, MOT, AOL, AMZN, JNPR, IBM, LMT, PCLN, MFE
Boeing Upgraded to Buy at Citigroup
Citigroup upgraded Boeing (BA) Thursday, elevating the company's stock to buy from hold. The brokerage house holds a positive view on the aerospace cycle and it feels that BA's valuation is reasonable. In addition to the upgrade, Citigroup bumped its target price on BA shares to $80 from $73. Following the upgrade, BA shares traded higher in premarket trading, but have been nearly flat at 10:00 a.m. as the market took a downturn.
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