After hitting a one-year low of $37.24 in August, the stock hit a one-year high of $75.21 in June. This morning, CRM opened at $67.15. So far today the stock has hit a low of $64.70 and a high of $67.23. As of 1:05, CRM is trading at $65.90, down $3.48 (-5.0%). The chart for CRM looks bearish but improving slightly, while S&P gives the stock a neutral 3 STARS (out of 5) hold rating.
For a bearish hedged play on this stock, I would consider an August bear-call credit spread above the $80 range. A bear-call credit spread is an options position that combines the purchase and sale of call options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. For this particular trade, we will make a 6.4% return in four weeks as long as CRM is below $80 at August expiration. CRM would have to rise by more than 21% before we would start to lose money. Learn more about this type of trade here.
MOST NOTEWORTHY: The Metals and Mining sector, Lamar Advertising and Rigel Pharmaceuticals were today's noteworthy initiations:
Banc of America initiated the Metals and Mining sector with an Equal Weight rating and believes investors should take a selective approach to stocks in the group. The firm initiated Alcoa (NYSE: AA) and RTI International Metals (NYSE: RTI) with Buy ratings and a $44 target and $41 target, and started Allegheny Tech (NYSE: ATI), Century Aluminum (NASDAQ: CENX) and Titanium Metals (NYSE: TIE) with Neutral ratings and a $64 target, $58 target and $12 target, respectively.
Lamar Advertising (NASDAQ: LAMR) was initiated at Caris with an Above Average rating and $40 target. Caris is positive on the company's North American focus and exposure to the aggressive deployment of digital boards.
Stanford believes Rigel Pharma's (NASDAQ: RIGL) lead drug R788 has the potential to be the first oral drug for rheumatoid arthritis and expects clinical news flow and partnerships to serve as catalysts. Shares were initiated with a Buy rating and $30 target.
OTHER INITIATIONS:
Thomas Weisel assumed Salesforce.com (NYSE: CRM) with an Overweight rating and $90 target.
International Flavors (NYSE: IFF) was initiated at Lehman with an Underweight rating.
JP Morgan started Ares Capital (NASDAQ: ARCC) with an Underweight rating.
Every day, I get a variety of media pitches from companies and PR folks. No doubt, I try to evaluate all of them.
The problem: some of the pitches don't work. As a result, a company may miss an opportunity to get some exposure.
However, there are some strategies to improve things. So, let's take a look:
Know the journalist: Most of us focus on certain topics (or have a so-called beat). Thus, read some of a journalist's work. If he or she doesn't cover your industry or market focus, then it's probably a waste of time to make a pitch.
Now, for those who are a right fit: put the journalist's name in a notebook or a database (there are free online offerings, such as Zoho). You might also look at other publications the journalist writes for. Oh, and it's a good idea to keep reading the journalist's work. To this end, you might set a filter with something like Google (NASDAQ: GOOG) News.
Craft a personalized pitch: OK, I will respond to a canned pitch. But, it better be highly targeted.
Well, last week I had a chance to meet with Gordon and we talked about what grabs his interest when an entrepreneur makes a pitch.
Of course, he wants a company that has a big market opportunity (say $1 billion) as well as a qualified team (or, at least, there is a team identified).
True, these are typical things. What else is important?
"What we find that's critical is that a company has shown an ability to build a relationship with customers," said Gordon. "It doesn't have to be a lot of customers. Instead, we want to see evidence that the company is engaging customers."
Unit economics is also key. "What are the customer acquisition costs?" said Gordon. "Is there a low-cost access to leads? We also want to see a short sales cycle."
Something else: Gordon wants a team with strong domain expertise. "On-demand is getting verticalized," he said. "In a way, it's about selling knowledge.
Lehman (NYSE: LEH) is recently trading at $29.73 in pre-open trading, below its close of $32.29 Friday.
LEH intends to raise $6 billion through an offering of common stock and non-cumulative mandatory convertible preferred stock. LEH expects Q2 loss of $2.8 billion and EPS of ($5.14) versus consensus of (22c).
LEH June 30 straddle is priced at $5.95, July 30 straddle is priced at $8.55. LEH June option implied volatility of 126 is above its 26-week average of 61 according to Track Data, suggesting larger price movement.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
TheStreet.com's Jim Cramer says observers demand perfection, but the arrows slung at diverse thinking offer lessons in making money.
The level of perfection people demand, the level of performance they say they demand, the insistence on making money in any particular way, these are all part of what it is like to be, well, me.
One of the best calls I have ever had was with Apple (NASDAQ: AAPL) (Cramer's Take). It was a happenstance call, as so many really are but pros won't admit that because well, then why pay them? My daughter wanted a second iPod because she had a pink one and needed a blue one. It was that "fashion statement" wakeup call that told me the numbers for iPods in the analysts' reports were way too low.
I pushed the stock hard everywhere. When I got my own show on CNBC, I endlessly lauded Apple in the $70s, $80s and $90s, and made a major statement when I included it in my Four Horsemen of Tech.
At the end of the year I took it off the list, as I did with all the Horsemen except Research In Motion (NASDAQ: RIMM) (Cramer's Take). The $198 price reeked of greed.
Before starting Salesforce.com (NYSE: CRM) in 1999, Marc Benioff was already a veteran of the traditional software world. He spent 13 years at Oracle (NASDAQ: ORCL) and even had a stint at Apple (NASDAQ: AAPL), where he programmed in assembler language. In fact, he started a software company – Liberty Software – when he was only 15 years.
But, of course, Salesforce.com is his biggest achievement and so far it has disrupted the industry. Basically, he has evangelized the virtues of using the Web to deliver software, as well as used the subscription business model rather than the up-front licensing fees. Benioff calls this "The End of Software."
Well, last week, Salesforce.com reported its Q1 results. For the most part, the growth is continuing apace. Revenues surged 52% to $248 million and operating cash flow came to $84 million. There were 2,600 new customers, with the total at 43,600.
A key to success has been integration with various platforms such as Microsoft's NASDAQ: MSFT). Salesforce.com also recently bolstered its partnership with Google (NASDAQ: GOOG) by seamlessly integrating its Office-like apps.
Another key is Salesforce.com's extensive infrastructure that handles huge amounts of transactions. The company plans to build its first international data center in Singapore.
The growth of on-demand software is surging in Asia. According to a Springboard Research report, the market is expected to reach $1.16 billion by 2010, representing a 66% annual growth rate. Salesforce.com is likely to be a big beneficiary of this major trend. Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates MergerBook.com.
MOST NOTEWORTHY: Salesforce.com, First Marblehead and The E.W. Scripps Co were today's noteworthy upgrades:
Jefferies upgraded shares of Salesforce.com (NYSE:CRM) to Buy from Hold following the company's Q1 results and recommends accumulating shares on any weakness from concerns around a slowdown in bookings. They believe that while bookings growth slowed in Q1, CRM's growth remains stellar and its market opportunity remains large.
Friedman Billings upgraded First Marblehead (NYSE:FMD) to Market Perform from Underperform. The firm believes most of the bad news is reflected in shares and that there are early indications of "thawing" within the private student loan ABS market.
Lehman upgraded the E.W. Scripps Co (NYSE:SSP) to Overweight from Underweight and expects the upcoming July 1st split of Scripps Networks Interactive from Scripps will give the company strategic opportunity by separating high growth cable from traditional newspapers and broadcasting.
It seems that the BCE (NYSE: BCE) buyout plan, has hit yet another bump on the road, only this one could not be as easy to overcome. A Quebec appeals court reversed a lower court and rejected the $33 billion buyout plan accepting the claim of a group of bondholders that the deal is unfair to them. BCE shares are plunging nearly 15% in premarket trading.
Earnings today are due from Barnes & Noble (NYSE: BKS) -- just after the company said it was interested in buying Borders (NYSE: BGP) -- and Gap (NYSE: GPS) -- a day after the clothing retailer announced an expansion in Russia.
Suntech Power Holdings Co. (NYSE: STP) shares are jumping over 7.5% in premarket trading after the solar energy company reported that first-quarter earnings more than doubled on 76% higher revenue. Earnings reached $55.8 million, or 33 cents an American depositary share and revenue reached $434.5. Analysts estimated 28 cents for the quarter.
General Motors (NYSE: GM) reached an agreement with workers at its Kansas City, Kan., assembly plant Tuesday that could help it end a string of labor problems. The deal could end the strike of 2,500 workers at the factory, which makes the hot-selling Chevrolet Malibu as well as the Saturn Aura, since May 5.
Barnes & Nobel (NYSE: BKS) is exploring a possible bid for rival Borders (NYSE: BGP), according to a report in the Wall Street Journal.
Reporting today: Limited Brands Inc. (NYSE: LTD) which is forecast to post earnings of 8 cents a share in the first quarter and Salesforce.com Inc. (NYSE: CRM), which is forecast to post earnings of 7 cents a share in the first quarter among other companies.
If you were paying close attention to this column last week, you would have sidestepped some of the pain and misery investors in many of the stocks discussed have suffered lately. Of late, we have seen the general direction of the markets turn positive, even in the face of news to the contrary.
Perhaps it is because investors have an appetite for stocks, since there seems to be few investment alternatives. Real estate is off limits and the yield on bonds and other fixed-income investments is pathetically low.
The theme for the week ahead is SMOOTH SAILING. In this week's column, we delve into some stocks that will be announcing earnings, and that may benefit from the changing tide of investor sentiment. To be sure, there will be several areas of choppiness as we continue to be bombarded by the stormy realities of a turbulent economy.
Monday, May 19
The chart for Campbell Soup (NYSE: CPB) looks M'm M'm good. Sporting a smooth line with nary a ripple over the past 12 months, management has done a great job at keeping both company earnings and share price up, even in the face of significant food inflation. While shares have been condensing during the past few months, recently they have been rising with a series of higher highs and higher lows. Be on the outlook for earnings of 44 cents per share on revenue expectations of $1.89 billion. Now that I think of it. That's a lot of soup wrapped in tin-plated steel -- one of many materials that has seen its price almost double in the past six months.
Under a new arrangement, Salesforce.com (NYSE:CRM) will begin to market Google's (NASDAQ:GOOG) Apps software. According toThe Wall Street Journal "The Internet search company and Salesforce.com, a provider of online services for salespeople and marketers, plan to announce that they have built technology into their products to make it easier for customers to share information between Salesforce.com and Google Apps."
Saleforce.com has tens of thousands of small business customers who use its products to manage their sales operations. The Google product competes with Microsoft's (NADDAQ:MSFT) word processing, spreadsheet, and presentation products. Google's software runs off of its servers while Microsoft's uses the memory and processing power of the customer's PC or handheld.
With the Micorosft Windows product running on well over 90% of the world's personal computers, the new partnership may not matter. Google's financial reports do not indicate that its Apps business is bringing in any significant revenue. As it reports numbers for the last quarter, if their is no evidence that its software operations are kicking in sales, it maybe an indication that Microsoft does not need to worry and that the Salesforce.com deal is a waste of good PR.
Douglas A. McIntyre is an editor at 247wallst.com.
Why Starbucks' Logo Changed The coffee chain is temporarily using a retro brown look to evoke its beginnings and restore some goodwill for the brand. Starbucks' Retro Logo - BusinessWeek
Big Names Owe Big-Time on Taxes The IRS estimates that 21% of federal individual income taxes go unpaid each year - about $300 billion last year. As Tuesday's tax deadline approaches, Americans are settling accounts on $1.5 trillion in federal and state income taxes for 2007. But what about those who don't pay? Who are they? Do they get away with it? Hundreds of seemingly wealthy people - company presidents, former soap opera stars, top-selling real estate agents - live in multimillion-dollar homes yet have huge tax problems. Many tax delinquents live openly and prosperously for years, even decades, while owing millions of dollars in taxes. These include singer Dionne Warwick, comedian Sinbad, Bill Clinton's former political advisor, Dick Morris, former U.S. treasurer Catalina Vásquez Villalpando and infamous celebrity OJ Simpson to name a few. Big names owe big-time on taxes - USATODAY.com
Salesforce.com (NYSE: CRM) shares are falling today after an analyst at Citigroup downgraded the stock to "Hold" from "Buy" based on the stock's valuation. Investors are shrugging off Thomas Weisel's "Buy" initiation in favor of the Citi downgrade. 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 CRM..gif){kind=logo}
Every day, I get a variety of media pitches from companies and PR folks. No doubt, I try to evaluate all of them. 
Gordon Ritter, the founder and general partner of 
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Lehman
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General Motors (NYSE: GM) reached an agreement with workers at its Kansas City, Kan., assembly plant Tuesday that could help it end a string of labor problems. The deal could end the strike of 2,500 workers at the factory, which makes the hot-selling Chevrolet Malibu as well as the Saturn Aura, since May 5.
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