Ultimate Market Recap: Forbes Lists The Worst IPOs of 2011 and Apple Set for TVs in Q3 2012
Tuesday Morning’s Top Stories
Samsung Electronics (SSNLF.PK) plans to increase global handset sales in 2012 by 15 percent to 374 millions units through smartphones, reported the Korea Economic Daily. This would give the electronics company a stronger presence against rival Nokia (NYSE:NOK), whose handset sales are estimated to drop 5 percent next year to 399 million.
In other news, Samsung’s board approved the purchase of Sony’s (NYSE:SNE) stake in their $1.08 trillion ($939 million) LCD joint venture.
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While Europe struggles with its ongoing debt crisis, American businesses and financial firms are doing business by making loans and grabbing assets owned by European banks (NYSEARCA:KBE), according to the New York Times. The activities have included mortgages on high-end hotels and office buildings in Dublin. The activities come as the European banks struggle to raise capital and decrease their balance sheets as requested by regulators.
According to Morgan Stanley (NYSE:MS) analyst Huw van Steenis, he estimated that European financial institutions will get rid of up to $3 trillion in assets during the next 18 months.
Sears Holdings Inc. (NASDAQ:SHLD) announced plans to close between 100 to 120 Sears and Kmart stores and take as high as $2.4 billion in charges; its fourth-quarter pretax profit is expected to drop by more than half as compared to the previous year. The gloomy news comes as the retailer reported fourth-quarter comparable sales dropped 5.2 percent for the eight weeks through December 25. The drops were seen from weaknesses in consumer electronics and apparel.
With Research in Motion’s (NASDAQ:RIMM) disastrous year and recent multi-year share price lows, investors and analysts are asking the company’s board of directors to step up and steer the company’s direction. This could be done by pushing for a strategic shift, ousting co-CEOS Jim Balsillie and Mike Lazaridis, or selling the company, according to the Wall Street Journal.
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Tuesday Morning Hot Stocks
Sears Holdings Corp. (NASDAQ:SHLD) is trading more than 13 percent down in early trading. The company announced between 100 and 120 stores will be closing due to poor sales. “Given our performance and the difficult economic environment, especially for big-ticket items, we intend to implement a series of actions to reduce ongoing expenses, adjust our asset base, and accelerate the transformation of our business model,” said CEO Louis D’Ambrosio. Other retailers such as Target (NYSE:TGT) and Big Lots Inc. (NYSE:BIG) are trading higher, while Wal-Mart (NYSE:WMT) is down about .23%.
Shares of MetLife Inc. (NYSE:MET) are climbing nearly 3 percent higher before the opening bell. The life insurer announced it will sell about $7.5 billion in bank deposits to General Electric’s (NYSE:GE) financial unit. Financial terms were not disclosed. Shares of General Electric Co. are trading down .49%.
Visa Inc. (NYSE:V) shares received a .39% boost after Goldman Sachs (NYSE:GS) reiterated its Buy rating and increased its price target to $114 per share. Competitors include other credit card companies such as MasterCard Inc. (NYSE:MA) and American Express Co. (NYSE:AXP).
Apple Inc. (NASDAQ:AAPL) is trading slightly higher after Digitimes claims Apple plans on releasing television sets in the third quarter of next year. The first models are expected to feature 32-inch and 37-inch displays. Other tech giants such as Google Inc.(NASDAQ:GOOG) and Hewlett-Packard Co. (NYSE:HPQ) traded lower in early trading.
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The Wendy’s Company (NYSE:WEN) moved higher early Tuesday after the company said it will open about 100 restaurants in Japan over the next five years. In the longer term, the company may open nearly 700 restaurants in Japan. Other fast-service food companies such as McDonald’s Corp. (NYSE:MCD) and Yum! Brands Inc. (NYSE:YUM) traded lower on the news.
Despite 60,000 pre-orders for its Aqua hybrid car, shares of Toyota Motor Corp. (NYSE:TM) are down .73 percent Tuesday morning. On a monthly basis, the automaker expects to sell 12,000 units of the Aqua hybrid. General Motors Co. (NYSE:GM) and Ford Motor Co. (NYSE:F) are also trading nearly 1% lower.
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Tuesday’s Trending Stocks
On Tuesday, the DJIA is trading higher at 12,307, the S&P 500 Index is trading at 1,266 and the Nasdaq is trading at 2,627. Here are the companies driving the market news on Wall Street today:
Sears Holdings Corporation (NASDAQ:SHLD): Shares of Sears Holdings Corporation are trading lower 24% today. Sears Holdings announced plans to close 100-120 Kmart and Sears Full-line stores. Sears Holdings Corporation is a broadline retailer with full-line and specialty retail stores in the United States and Canada. The Company retails home appliances, as well as tools, lawn and garden products, home electronics, and other products. Sears Holdings also provides automotive repair and maintenance.
Cal-Maine Foods, Inc. (NASDAQ:CALM): Shares of Cal-Maine Foods, Inc. are trading higher 4.5% today. The company beat expectations, pushing the stock price upward. Cal-Maine Foods, Inc. produces, cleans, grades, packs, and sells fresh shell eggs. The Company markets its products in various states in the Southwestern, Southeastern, Midwestern, and Mid-Atlantic regions of the United States.
Parlux Fragrances, Inc. (NASDAQ:PARL): Shares of Parlux Fragrances, Inc. are trading higher 71% today. Perfumania Holdings Inc. said it agreed to acquire Parlux Fragrances Inc. in a deal valued at $170 million. Parlux Fragrances, Inc. is a manufacturer and international distributor of prestige fragrances. The Company holds the licenses to manufacture and distribute the designer fragrance brands of Perry Ellis and Fred Hayman Beverly Hills. Parlux also owns, manufactures, and distributes its own fragrance brand, Animale Parfums.
GigaMedia Limited (NASDAQ:GIGM): Shares of GigaMedia Limited are trading higher 22% today. The company said it sold all of its ownership interest in T2CN Holding Ltd to Hornfull Limited. GigaMedia Ltd. provides online entertainment software and services to the online gaming industry, particularly the online poker and casino industry. The Company develops and licenses software for online gambling; and offers MahJong and other games online. GigaMedia Ltd. operates in Greater China, including the Peoples Republic of China, Taiwan, Hong Kong, and Macau.
Cogdell Spencer Inc. (NYSE:CSA): Shares of Cogdell Spencer Inc. are trading higher 9% today. Chicago-based medical real estate investment trust Ventas announced it has agreed to buy Charlotte based Cogdell Spencer for $4.25 a share. Cogdell Spencer Inc. owns specialty office properties for the medical profession. The Company focuses on the ownership, development, redevelopment, acquisition, and management of strategically located medical office buildings and other healthcare related facilities in the southeastern United States.
Magnum Hunter Resources Corp (NYSE:MHR): Shares of Magnum Hunter Resources Corp are trading higher 16% today. The company increased its production estimates for this year and next year on higher-than-expected output from new wells. Magnum Hunter Resources Corporation explores for oil and natural gas.
PokerTek, Inc. (NASDAQ:PTEK): Shares of PokerTek, Inc. are trading higher 30% today. The gaming company is seeing a lift due to a Justice Department opinion that gives state power to legalize most forms of online gambling within their borders. PokerTek, Inc. has developed and markets an electronic poker table that provides a fully-automated poker-room environment. The Company markets its system to tribal casinos, commercial casinos, and card clubs.
Piedmont Natural Gas Company Inc. (NYSE:PNY): Shares of Piedmont Natural Gas Company Inc. are trading higher 1% today. Investors are seeing the 3.4% dividend as very attractive for the energy company. Piedmont Natural Gas Company, Inc. is an energy and services company that primarily transports, distributes, and sells natural gas. The Company serves residential, commercial, and industrial customers in North Carolina, South Carolina, and Tennessee. Piedmont also, through subsidiaries, markets natural gas to customers in Georgia, and distributes propane in various states.
Bank of America Corporation (NYSE:BAC): Shares of Bank of America Corporation are trading lower 1% today. Reuters reported may need to sell more assets to increase capital levels, while the CEO has reiterated the bank is moving the the right direction again to get back to a stable footing. Bank of America Corporation accepts deposits and offers banking, investing, asset management, and other financial and risk-management products and services. The Company has a mortgage lending subsidiary, and an investment banking and securities brokerage subsidiary.
Alexandria Real Estate Equities Inc. (NYSE:ARE): Shares of Alexandria Real Estate Equities Inc. are trading higher .65% today. Investors are moving the stock higher, as they see improving real estate date and a dividend of 2.8%. Alexandria Real Estate Equities, Inc. acquires, manages, expands and develops office and laboratory space properties. The Company leases its properties to pharmaceutical, biotechnology, diagnostic and personal care products companies, research institutions and related government agencies. Properties are located in California, suburban Washington D.C., New England, the Mideast and Southeast.
Markets closed mixed on Wall Street today: Dow -0.02%, S&P+0.01%, Nasdaq +0.25%, Oil +1.67%, Gold -0.69%.
On the commodities front, Oil (NYSE:USO) climbed to $101.34 a barrel. Precious metals were down, with Gold (NYSE:GLD) falling to $1,594.90 an ounce while Silver (NYSE:SLV) fell 1.54% to settle at $28.64.
Today’s markets were mixed because:
1) Home prices. Though equities closed the day mostly flat, they started the day sharply lower on news that U.S. home prices fell more than forecast in the year ended in October, indicating that the housing market continues to be weighed down by foreclosures. The S&P/Case-Shiller index of property values in 20 major U.S. cities fell 3.4 percent from October 2010 to October 2011, after decreasing 3.5 percent in the 12-months ended in September, the group said today.
2) Consumer confidence. Stocks quickly reversed their decline when the Conference Board announced its index of consumer sentiment rose to the highest level in eight months in December, with a reading well above the average during the recession that ended in June 2009. Improving sentiment might help sustain household purchases, which account for roughly 70 percent of the U.S. economy. The Conference Board’s measure of present conditions increased this month as well, as did its measure of expectations for the next six months, while the share of consumers saying they believed jobs were plentiful rose in December to its highest since January 2009 and those saying employment was hard to get decreased to the lowest since January 2009. More respondents also said they expected more jobs to become available in the next six months, and that they expect their incomes will likely increase as well.
3) Sears. Sears Holdings (NASDAQ:SHLD) on Tuesday reported a sharp drop in holiday sales compared to a year ago, and said the results will force them to close 100 to 120 Sears and Kmart stores. As a result, SHLD shares plunged 26 percent, dragging down other retail stocks on fear that Sears might not be alone when it comes to underwhelming holiday sales figures. J.C. Penney (NYSE:JCP), Kohl’s (NYSE:KSS), Saks (NYSE:SKS), The Bon-Ton Stores (NASDAQ:BONT), and Wal-Mart (NYSE:WMT) all closed the day lower.
After Hours Radar Stocks
After closing down almost 9 percent, shares of Computer Sciences Corp. (NYSE:CSC) continue to attract heavy attention. The company warned it may write down a $1.5 billion contract with Britain’s National Health Service.
Shares of Morgan Stanley (NYSE:MS) are edging .20 percent higher in late trading after a report leaked that the bank plans on cutting 580 jobs in New York City. Other financial firms such as Goldman Sachs (NYSE:GS) and Citigroup (NYSE:C) are trading lower on the news.
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Although IPOs such as LinkedIn Corp. (NYSE:LNKD), Groupon Inc. (NASDAQ:GRPN) and Pandora Media Inc.(NYSE:P) have dominated headlines this year, other IPOs deserve some attention. Forbes recently released a list of the worst IPOs in 2011. The list contains FriendFinder Networks (FFN) with a 94% loss from its IPO. Imperial Holding (NYSE:IFT) and Kips Bay Medical (NASDAQ:KIPS) followed with losses of 83% and 79% respectively. Mission New Energy Limited (NASDAQ:MNEL), Sequans Communications S.A. (NYSE:SQNS), Renren (NYSE:RENN) and Tudou Holdings (NASDAQ:TUDO) also rounded out the list.
Shares of The New York Times Co. (NYSE:NYT) are jumping 1.6% in late trading. The media company announced it reached an agreement to sell its Regional Media Group to Halifax media Holdings for $143 million in cash.
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