Paul Ebeling on Best Buy Co., Inc. (BBY), Peabody Energy Corp. (BTU), ChevronTexaco Corporation (CVX), Hewlett-Packard (HPQ), and US Bancorp (USB).
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The Red Roadmaster’s US Market Monthly Re-cap + Stock Talk ™ 13 April 2010 Date Line: Hong Kong (SAR) China You can now follow us on Twitter please go to http://twitter.com/EbelingHefferna and join in. Red’s Bull Alert : The DJIA closed above 11,000 for the first time in almost 19 months and the S&P 500 tapped at 1,200 a Key level Monday as expectations of strong Q-1 earnings drove buying in the Financial, Energy and Industrial Sectors. Re-cap of the US Stock Market Action for the session ending 12 April 2010 S&P 500 is up 76.9% since hitting bottom on March 9, 2009. The DJIA gained 8.62 pts, or 0.08%, to close at 11,005.97 (its highest since September 2008), the S&P 500 rose 2.11 pts, or 0.18%, to close at 1,196.48, and the NAS tallied up a + 3.82 pts, or 0.16%, to end the session at 2,457.87. Q-1 earnings for S&P 500 companies are expected to rise 37.1% from a year ago levels, marking the 2nd straight positive Q for earnings since Y 2007. The Volatility Index (VIX) closed 3.9% lower on the day, though it had been down as much as 5.6% to a fresh 30 month low during the session. Advancing Sectors: Financials (+0.5%), Utilities (+0.4%), Tech (+0.3%), Industrials (+0.3%), Energy (+0.3%), Consumer Staples (+0.1%) Declining Sectors: Materials (-0.5%), Telecom (-0.2%), Health Care (-0.2%) 1
Transcript
The Red Roadmaster’s US Market Monthly Re-cap + Stock Talk ™
13 April 2010 Date Line: Hong Kong (SAR) China
You can now follow us on Twitter please go to http://twitter.com/EbelingHefferna and join in.
Red’s Bull Alert: The DJIA closed above 11,000 for the first time in almost 19 months and the S&P 500 tapped at 1,200 a Key level Monday as expectations of strong Q-1 earnings drove buying in the Financial, Energy and Industrial Sectors.
Re-cap of the US Stock Market Action for the session ending 12 April 2010
S&P 500 is up 76.9% since hitting bottom on March 9, 2009.
The DJIA gained 8.62 pts, or 0.08%, to close at 11,005.97 (its highest since September 2008), the S&P 500 rose 2.11 pts, or 0.18%, to close at 1,196.48, and the NAS tallied up a + 3.82 pts, or 0.16%, to end the session at 2,457.87.
Q-1 earnings for S&P 500 companies are expected to rise 37.1% from a year ago levels, marking the 2nd straight positive Q for earnings since Y 2007.
The Volatility Index (VIX) closed 3.9% lower on the day, though it had been down as much as 5.6% to a fresh 30 month low during the session.
Declining Sectors: Materials (-0.5%), Telecom (-0.2%), Health Care (-0.2%)
Unchanged: Consumer Discretionary
Volume and Breadth: about 7.93B/shrs traded on the NYSE, the AMEX, and NAS, below last year's esti-mated daily average of 9.65B/shrs. Advancers outnumbered decliners on the NYSE by 4 to 3, and on the NAS, 6 stocks rose for each 5 that fell.
Today, let’s look at Best Buy Co., Inc. (BBY), the huge international specialty retailer, from a Technical POV. The overall indications, after Monday’s (April 12) market action, are Bullish: in the near term Bullish, mid-term Very Bullish, and long term Bullish. The recent Candle Stick analysis is: Very Bearish
**Chart by: http://www.stockta.com
Latest News and Opinion: Survey: Best Buy a 'best brand'
Monday’s Market Action Close 45.23 + .34 Volume 6,062,600/shrs
There is a Hammer on April 9, and one Gap open up on March 5 at 37.35/37.40, the near term resistance is 45.37, support at 44.42, and the 50 day (EMA) exponential moving average is 40.66.
This is Best Buy Co., Inc. (BBY): the Company operates as a specialty retailer in the United States, Canada, Mexico, China, and Europe. It offers consumer electronic video products, such as televisions, digital cameras and accessories, digital camcorders, and DVD players; and audio products comprising MP3 players, navigation products, home theater audio systems and components, and mobile electronics. It also offers home office products comprising notebook and desktop computers, monitors, mobile phones and related subscription service commissions, hard drives, and networking equipment; entertainment software products, such as video gaming hardware and software, DVDs, CDs, digital downloads, and computer software; and appliances, such as kitchen appliances, plumbing fixtures, snacks, and beverages. Best Buy Co. also offers service contracts; extended warranties; product repair; broadband voice, data, and information technology services; and delivers and installs home theater, mobile audio, and appliances. As of February 28, 2009, it operated 1,023 U.S. Best Buy stores, 38 U.S. Best Buy Mobile stand-alone stores, 34 Pacific Sales stores, 6 Magnolia Audio Video stores, and 6 Geek Squad stand-alone stores. It was formerly known as Sound of Music, Inc. and changed its name to Best Buy Co., Inc. in 1983. The company founded in 1966 and is headquartered in Richfield, Minnesota.
Competitive Landscape
Technological innovation and the need to replace or upgrade products drive demand. Profitability for individual companies depends on the ability to generate store traffic and repeat business, and effective merchandising. Large companies can offer wide selections of products and low prices. Small companies can compete effectively by offering specialized products, technological expertise, or superior customer service. Average annual revenue per employee is about US$200,000. Competitors include mass merchandisers, warehouse clubs, department stores, Internet and mail order retailers, specialty office and computer retailers, and some manufacturers.Consumer Electronics Stores Industry ForecastUS personal consumption expenditures of electronic entertainment, musical instruments, and home computers are forecast to grow at an annual compounded rate of 4% between 2008 and 2013. Data Sourced: December 2009
Best Buy Co. Inc. (HQ)
Richard M. Schulze, Founder and Chairman7601 Penn Avenue SouthRichfield, MN 55423United States -Phone: 612-291-1000http://www.bestbuy.com
Peabody Energy Corp. (BTU) Up-date 2 Last Look: March 3, 2010
Today let’s look at Peabody Energy Corp. (BTU), the World's largest private-sector coal producer, from a Technical POV. The overall analysis after Monday’s (April 12) market action is Bullish: in the near term Very Bullish, mid-term Bullish, and long term Bullish. The recent Candle Stick analysis is: Very Bullish
**Chart by: http://www.stockta.com
Latest News and Opinion: Peabody Energy in talks with Indian coal company
Monday’s Market Action Close 48.01 +1.66 Volume 9,274,000/shrs
There is a Homing Pigeon and no Gaps open up or down on the Chart, the near term resistance is 49.47, support at 47.88, and the 50 day (EMA) exponential moving average is 46.44.
This is Peabody Energy Corp. (BTU): The Company engages in the exploration, mining, and production of coal worldwide. It owns interests in 30 coal operations located in the United States and Australia, as
well as owns joint venture interests in a Venezuelan mine. The company also markets, brokerages, and trades coal. It also develops mine-mouth coal-fueled generating plants; and develops Btu Conversion technologies, which are designed to convert coal to natural gas and transportation fuels. The company sells its steam coal to electric utilities and metallurgical coal to industrial customers. As of December 31, 2008, Peabody Energy had 9.2B tonnes of proven and probable coal reserves. The company was founded in 1883 and is based in St. Louis, Missouri.
Competitive LandscapeDemand comes mainly from generators of electricity. Profitability depends on efficient operations, as the product is a commodity sold on the basis of price. Small companies can compete if they hold long-term contracts or if they supply local customers. Big companies have large economies of scale in production and distribution. The industry is capital-intensive and highly automated: average annual revenue per employee is almost US$300,000.
Coal Mining Industry Forecast
The output of US coal mining is forecast to grow at an annual compounded rate of 1% between 2008 and 2013. Data Sourced: December 2009
Peabody Energy Corp. (HQ)
Gregory H. Boyce Chairman, Chief Exec. Officer
701 Market StreetSt Louis, MO 63101-1826United StatesPhone: 314-342-3400Fax: 314-342-7799
http://www.peabodyenergy.com
Peabody Energy Subsidiaries
Black Beauty Coal CompanyPatriot Coal Corporation
ChevronTexaco Corporation (CVX) Up-date 11 Last Look: July 10, 2009
Today let’s have a look at ChevronTexaco Corporation (CVX), the US Oil Giant, from a Technical POV. The overall indications, after Monday’s (April 12) market action, are Bullish: in the near term Bullish, mid-term Bullish, and long term Bullish. The Recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News and Opinion: Zacks Analyst Blog Highlights: Intel Corporation Inc., Chevron Corp., ExxonMobil Corp., Royal Dutch Shell PLC and ConocoPhillips
Monday’s Market Action Close 80.43 + .93 Volume 9,999,900/shrs
There is one Gap open up on April 1 at 76.14/76.34, the near term resistance is 80.88, support at 79.64, and the 50 day (EMA) exponential moving average is 75.35.
This is ChevronTexaco Corporation (CVX): Texaco's star and its Chevron stripes allow this US Oil Giant to have market clout. It is the 2nd largest US integrated oil company behind Exxon Mobil and has proved reserves of 10.8 B bbls of crude oil equivalent and a daily production of 2.6 MM bbls of crude oil equivalent, and it also owns interests in chemicals, pipelines, and power production businesses. The company, which is restructuring its refinery and retail businesses, owns or has stakes in 9,700 gas stations in the US which operate under the Chevron and Texaco brands. Outside the US it owns or has stakes in 15,400 gas stations, which also use the Caltex brand.
The Competitive Landscape
Demand is driven by federal legislation and regulations that establish a government-mandated market for bio-fuels. The profitability of bio-fuel production facilities depends on prices of gas and diesel, which fluctuate based on world petroleum demand and domestic refinery utilization. Economies of scale in ethanol production are limited due to the transportation costs associated with gathering feed stocks (corn and other biomasses) and transporting the ethanol to blending sites. As a result, large companies operate multiple production facilities. Small companies can compete effectively by developing business relations with distributors and being able to assure delivery consistently. Revenue per employee in ethanol production facilities is about US$1MMper year.
Industries Where Chevron Competes
Energy & UtilitiesOil & Gas Refining, Marketing & DistributionAlternative Energy SourcesChemicalsFinancial ServicesRetail
ChevronTexaco Corporation (HQ)
Chairman and CEO David J. (Dave) O'Reilly
6001 Bollinger Canyon Rd. San Ramon, CA 94583United States Phone: 925-842-1000Fax: 925-842-3530
http://www.chevron.com
Chevron Subsidiaries and Affiliates
Bridgeline Holdings, L.P.Caltex Australia LimitedChevron Mining Inc.
Hewlett-Packard (HPQ) Up-date 5 Last Look: August 18, 2009
Today let’s look at Hewlett-Packard (HPQ), the World’s #1 personal computing company, from a Technical POV. The overall indications, after Monday’s (April 12) market action are Bullish: in the near term Bullish, mid-term Bullish, and long term Neutral. The recent Candle Stick analysis is: Neutral
**Chart by: http://www.stockta.com
Latest News and Opinion: Hewlett-Packard wraps up 3Com buy
There are two Gaps open up between February 16 and 17 at 48.61/49.70, the near term resistance is 56.80, support at 53.11 and the 50 day (EMA) exponential moving average is 52.04.
This is Hewlett-Packard (HPQ): the Company is a pioneer in providing affordable personal computing throughout the world. In PC’s, the company commands the number one position worldwide with a 19% share of the market. 2008 Revenues came approximately 78% from products and 22% from services. 1st quarter 2009, approximately 30% of revenues came from services. 70% of HP’s customer base is located outside of the US. It operates in seven segments which are grouped together to form Technology Solutions Group: enterprise storage and servers, HP services, and HP software. HPQ has had a number of important improvements including a jump in ROE of 21.5% 08’ from 19% 07’ and 16.5% 06’.
Competitive Landscape
Demand is driven by global unit sales of personal computers and services. Price competition which has accounted for a long-term trend in the industry has placed pressure on lower average selling prices. Streamlining of operations will provide larger corporations with economies of scale and wider profit margins. Smaller firms will keep the heat on with vigilant competition as far as new products that draw away market share from PC sales. Global appetite for technology products such as Smartphone’s, personal digital assistants and lightweight PC’s will fuel long-term growth in the industry.
Sub-Industry Index: Computer Hardware Index
Year to date through May 8, the index gained 21.0%, as compared to 3.3 increase in the S&P 1500 Composite Index. In 2008, the sub-industry index declined 40.5%, versus a 38.5% decline for the S&P 1500 Composite Index.
Hewlett-Packard (HPQ)
Chairman and Chief Executive Officer; Mark V Hurd
3000 Hanover StreetPalo Alto, CA 94304United States Phone: 650-857-1501Fax: 650-857-5518
http://www.hp.com
US Bancorp (USB) Up-date 2 Last Look: January 21, 2010
Today let’s look at US Bancorp (USB), the large regional US bank, from a Technical POV. The overall analysis after Monday’s (April 12) market action is Bullish: in the near term Bullish, mid-term Bullish. , and long term Very Bullish. The recent Candle Stick analysis is: Very Bearish
**Chart by: http://www.stockta.com
Latest News and Opinion: Buy Financials Before Earnings
Monday’s Market Action Close 27.51 + .35 Volume 11,025,500/shrs
There is a Bearish Doji Star on April 9, and no Gaps open up or down on the Chart, the near term resistance is NIL support at 27.46, and the 50 day (EMA) exponential moving average is 25.49.
This is US Bancorp (USB): This US bank has approximately 2,800 locations and 5,000 branded ATMs in two dozen mid-western and western states. The bank holding company, one of the 10 largest in the country, owns U.S. Bank and other subsidiaries that provide consumer and commercial banking, as well as credit card and ATM processing, mutual funds, mortgage banking, brokerage, wealth management, equipment leasing, trust services, corporate payments, and insurance. In late 2008 U.S. Bancorp acquired the banking operations of the failed California-based banks Downey Savings & Loan and PFF Bank & Trust in an FDIC-assisted transaction.
Competitive Landscape
Demand for banking services is closely tied to economic activity and the level of interest rates. The profitability of individual banks depends on marketing skills, efficient operations, and good risk management. Large economies of scale exist in some segments of the industry, which has encouraged industry consolidation. Smaller banks can compete successfully in segments where customer service or knowledge of the local market is more important. The industry is capital-intensive and highly automated: annual revenue per employee is close to US$300,000.Banks and Credit Unions Industry ForecastThe output of US banks and credit unions is forecast to grow at an annual compounded rate of 1 % between 2008 and 2013. Data Sourced: December 2009
US Bancorp (HQ)
Richard K. Davis, Chairman, President and CEO
800 Nicollet MallMinneapolis, MN 55402United States Phone: 651-466-3000
http://www.usbank.com
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