Kratisto Investing

Investopedia: TAL International One Of The Few Positive Shipping Stories

2012-02-16T19:58:00.000-05:00

The shipping industry is full of misery these days, what with rates for tankers and bulk cargo carriers so low and numerous shipping companies finding their liquidity situation tightening badly. Container leasing a different matter entirely, though, and TAL International (NYSE:TAL) continues to build solid value for its investors.

A Respectable Fourth Quarter
Most of TAL International's fourth quarter numbers were solid. Leasing revenue rose more than 31% from the year-ago period as leasing rates for containers have stayed quite healthy. Better still, TAL isn't frittering away this demand - adjusted EBITDA rose nearly 34%, while adjusted pre-tax income climbed more than 44%.

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http://stocks.investopedia.com/stock-analysis/2012/TAL-International-One-Of-The-Few-Positive-Shipping-Stories-TAL-BOX-CAP-FRO-TGH0216.aspx

Investopedia: Rackspace Has Already Racked Up A Demanding Valuation

2012-02-16T19:56:00.000-05:00

Server hoster and cloud computing play Rackspace (NYSE:RAX) is a straightforward play on two of the biggest trends in IT today - cloud computing and big data. Unfortunately, the company has a valuation to match and it's joined the ranks of hot tech stocks. The question, then, is whether the company's service-oriented model can keep fostering the sort of growth it will take to not only stay ahead of rivals like Amazon (Nasdaq:AMZN) and Google (Nasdaq:GOOG), but to maintain those lofty premiums.

Really Nothing to Disappoint in Q4
To its credit, Rackspace did everything it needed to do in Q4 and then some. Revenue rose 32% when compared to last year and about 7% when compared to the third quarter. The monthly installed base rose a bit more than 1%, while the average per-user revenue rose more than 7%. The company's cloud services revenue rose 86% from last year.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/Rackspace-Has-Already-Racked-Up-A-Demanding-Valuation-RAX-AMZN-GOOG-HPQ-MSFT0216.aspx

Seeking Alpha: Dentsply - A Great Stock, But Not A Great Price

2012-02-16T18:56:00.000-05:00

Dental care has held up better than most analysts expected, and Dentsply's (XRAY) to decision to continue investing in the business during the worst of the downturn should put it in place to gain even more share. That said, the stock's relative outperformance has left it a little expensive when compared to the larger med-tech universe.

A Confusing Q4
Dentsply's financial press releases are never what you might call a vault of information, and this is a company where shareholders should definitely make a point of listening to the conference call or reading the transcript. That said, even with the supplementary information, this was a complicated quarter.

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Dentsply: A Great Stock, But Not A Great Price

Seeking Alpha: Grupo Elektra Copies First Cash Financial Model - Backwards

2012-02-16T18:54:00.000-05:00

I found it curious to wake up this morning to news that Mexico's Grupo Elektra (GLEKY.PK), a Mexican retail and financial services conglomerate, was acquiring American payday lender Advance America (AEA) for $780 million in cash. While it represents virtually no threat at all to First Cash Financial (FCFS), it's an interesting twist on the two companies' growth strategies.

A Familiar Story, Told Backwards
First Cash built a solid pawn shop business in the U.S. by catering to consumers who largely operated outside the traditional banking and credit channels (whether by choice or otherwise). The company then found a new leg to its growth by expanding its pawn shop operations to Mexico - a country that is remarkably more "under-banked" than the U.S. Through a combination of torrid new store building and solid same-store sales growth, Mexico has grown to over half of the company's business and more than half of its growth.

Read the full article here:
Grupo Elektra Copies First Cash Financial Model - Backwards

Investopedia: MetLife Seems Seriously Underestimated

2012-02-16T16:01:00.000-05:00

Even accepting that the credit crunch and recession changed a lot of views on just how strong even the best financial institutions actually are, it seems like MetLife (NYSE:MET) still carries too much doubt and skepticism with it. Granted, regulatory burden and low interest rates are certainly near-term challenges, but patient investors could reap outsized gains if and when MetLife can return to more normal performance.

Pretty Solid Fourth Quarter Results
MetLife delivered a good end to the fiscal year. At the bottom-most of bottom lines, operating earnings came in at $1.31; not only up 15% from last year, but comfortably ahead of an average expectation of 1.24.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/MetLife-Seems-Seriously-Underestimated--MET-PRU-GNW-SLF0216.aspx

Investopedia: Can Arch Capital Keep Pulling Rabbits Out Of Its Hat?

2012-02-16T11:03:00.000-05:00

Years of superior performance have established quite a reputation for the management of Arch Capital (Nasdaq:ACGL). In good times and bad, this seems to be one of the best-run Bermuda-based insurance companies. The question investors have to ask, though, is whether there is enough leeway in the present valuation to really make this one of the best-performing stocks out there over the coming year or two.

Fourth Quarter Results
Arch Capital reported that gross written premiums rose more than 5% for the fourth quarter, with particular strength (up 17%) in reinsurance. Net written premium growth was a little stronger, coming in at nearly 6%, while net investment income was down 11%.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/Can-Arch-Capital-Keep-Pulling-Rabbits-Out-Of-Its-Hat-ACGL-ACE-AXS-ENH0216.aspx

Investopedia: Weight Watchers - Yo-Yo Performance And Debt Gluttony

2012-02-16T11:01:00.002-05:00

The combination of an asset-light business model and a strong brand can be tremendously powerful, and Weight Watchers (NYSE:WTW) clearly has the sort of returns on capital that bespeak a quality business. Unfortunately, operational stability has proven elusive and the company's decision to launch a large buyback is going to stretch an already stressed balance sheet even further. (For related reading, see A Breakdown Of Stock Buybacks.)

A Slightly Soft Fourth Quarter
Although Weight Watchers' reported fourth quarter results were OK, they were not as strong as the sell-side projected. Sales grew almost 13%, but were a a bit shy of expectations despite being around a 60% jump in online revenue. Total paid weeks did climb nearly 34%, though, and North America's meeting revenue rose about 8%.

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http://stocks.investopedia.com/stock-analysis/2012/Weight-Watchers--Yo-Yo-Performance-And-Debt-Gluttony-WTW-NTRI-MED-ABT0216.aspx

Investopedia: Can EnergySolutions Drive Value From Scarce Assets?

2012-02-15T19:33:00.000-05:00

Usually, scarcity means value in the equity markets. Unfortunately, anything relating to the nuclear power sector in the U.S. is colored with risk and uncertainty, and small engineering services firm EnergySolutions (NYSE:ES) has had trouble leveraging its expertise and assets in nuclear decommissioning. Although budgets and schedules are likely to remain uncertain for the foreseeable future, it would seem that the valuation on this stock has factored in quite a lot of bad news already.

Ahead of Schedule and Under Budget
The biggest project at present for EnergySolutions is the decommissioning of Exelon's (NYSE:EXC) Zion plant. Although there were fears that the early margins on this project would be weak, overall results have not been bad at all so far. More to the point, as of early 2012, it looks like this project is on target or better, and the company is working to renegotiate a cumbersome letter of credit. (For related reading, see Analyzing Operating Margins.)

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http://stocks.investopedia.com/stock-analysis/2012/Can-EnergySolutions-Drive-Value-From-Scarce-Assets-ES-EXC-FLR-GE-SHAW0215.aspx

Seeking Alpha: Quest Software - So Far, So-So

2012-02-15T19:25:00.000-05:00

Investing in low-growth value-priced software stocks is a little like digging for gold with a Nerf shovel - you can get there eventually, but it's going to take a lot of patience. Clearly Wall Street did not care for the earnings report of Quest Software (QSFT), nor the new of an unexpected change in CEO, but underlying results were not so bad and patience could yet pay off for investors.

Fourth-Quarter Results Mostly Better Than They Seem
Quest reported that revenue rose about 13%, more or less meeting the average analyst guess. License revenue was a little soft, growing 8% on a reported basis, but growing not at all on an organic basis and missing the average estimate. Service revenue was a little better with 18% reported growth and 6% organic growth, but the beat versus expectations was modest.

Read the full piece here:
Quest Software - So Far, So-So

Seeking Alpha: Trying To Reconcile Deere's Double-Digit Growth With Peaking Demand

2012-02-15T15:14:00.000-05:00

Deere (DE) is certainly not an ordinary heavy machinery company. Farmers tend to be loyal to brands and Deere has one of the most valuable brands in the world, let alone just in farm machinery. The trouble with Deere as a stock, though, is trying to balance out what is clearly a strong North American market with the past cyclicality of this business and industry.

A Few Hiccups In The Start To The Year
On balance Deere had a solid start to its fiscal year, but there were a couple of details that concern me as they relate to growth expectations. Total revenue rose 11% for the quarter and equipment revenue rose by a like amount - giving the company a better start to the year than expected.

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Trying To Reconcile Deere's Double-Digit Growth With Peaking Demand

Seeking Alpha: With New Management, Teva Seeks To Reclaim Past Glories

2012-02-15T13:56:00.000-05:00

To the credit of Teva Pharmaceuticals' (TEVA) board, if you underperform in the top spot there, you will be replaced. Recent years have seen the company struggle to deliver the sort of performance that shareholders had come to expect, and missteps in manufacturing and clinical development didn't help matters. Now the company has a new CEO, strong generic candidates, a growing branded business, and perhaps a chance to regain past esteem.

A Fairly Solid Q4
Teva's fourth quarter results were solid, if not radically ahead of expectations. Revenue rose about 29% as reported, with the inclusion of Cephalon adding a significant amount of revenue growth. Revenue from generic drugs and ingredients rose 12% overall, but were down 5% in the U.S. Branded drug sales rose 68% as reported or about 25% on an organic basis, with Teva's key multiple sclerosis drug Copaxone up 11%.

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With New Management, Teva Seeks To Reclaim Past Glories

Investopedia: Legal Unknowns Cloud Lender Processing Services Outlook

2012-02-15T13:31:00.000-05:00

The fallout of the housing bubble and crash is still sorting out, but it looks like we're now at the point where regulators are going hunting for trophies to display to their still-angry voting constituents. While major banks continue to seek settlements for their part in the wrong-doing, Lender Processing Services (NYSE:LPS) is also finding itself in the crosshairs. Although this company's strong data and service offerings is likely to survive this mess on an operational basis, the legal liabilities and regulatory uncertainties could well weigh on the shares for some time to come.

Underlying Business Conditions Are Tough
Absent some charges and adjustments, it was pretty clear from LPS's fourth quarter that operating conditions are still difficult. Revenue was down 14% this quarter, as transactions services revenue plunged 21% on lower default and loan facilitation service revenue. The company's data and analytics business fared reasonably well, though, and saw roughly 5% growth.

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http://stocks.investopedia.com/stock-analysis/2012/Legal-Unknowns-Cloud-Lender-Processing-Services-Outlook-LPS-FISV-CLGX-FAF0215.aspx

Investopedia: Apache Still Cheap Enough To Pay

2012-02-15T13:29:00.002-05:00

Despite a long-term record that should place it among the best-run energy companies, Apache (NYSE:APA) is more often criticized for whatever it isn't than what it is has always been. Apache is never the company to play when oil is hot, nor is it the company to play when natural gas is the place to be. Apache is never the name to consider when a particular play or geology is in the news.

What Apache is, though, is a company with an enviable record of cash generation and per-barrel margins and a company with a record of producing excellent economic returns in place where others fear to tread. Apache's balance and diversification means it will never be the hottest name in the sector, but the value here is such that investors who want a dependable play on oil and gas should take a serious look.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/Apache-Still-Cheap-Enough-To-Pay-APA-XOM-DVN-CHK0215.aspx

Seeking Alpha: Gen-Probe Looking To New Launches To Drive Momentum

2012-02-14T21:55:00.000-05:00

Even for somebody like me who spent the better part of a decade as a sell-side med-tech analyst, the diagnostics industry is often a muddle. While large established players like Abbott Labs (ABT), Danaher (DHR), and Roche (RHHBY.PK) look to change with the times and hang on to lucrative market share, up-and-comers like
Cepheid (CPHD) and Gen-Probe (GPRO) look to shake up the market and drive significant growth through major advances in testing technology.

With a new testing platform on the way and an expanding menu of tests, Gen-Probe may be looking at capturing some real share over the next couple of years. At the same time, valuation leaves little room for mistakes.

Closing Out The Year With A Shrug
Gen-Probe's fiscal fourth quarter earnings were pretty much mediocre. Revenue growth of about 16% was a bit light, with generally better-than-expected performance in blood screening (up almost 31%) offsetting the clinical diagnostics business (up 13%).

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Gen-Probe Looking To New Launches To Drive Momentum

Investopedia: Value At Abbott Labs Balances A Lot Of Growth Optimism

2012-02-14T12:01:00.000-05:00

If the management at Abbott Labs (NYSE:ABT) was hoping that its decision to split the company in two (basically spinning off the pharmaceutical business) would generate buzz and enthusiasm around the company, it seems that they succeeded. Whereas most analysts are skeptical about the ability for large drug and device companies to produce meaningful long-term growth, it seems like most sell-side analysts are happy to assume a good growth runway for this large (and generally conservative) med-tech conglomerate.

Q4 Results May Hint At Some of the Challenges

When Abbott reported earnings a few weeks ago, the results got a generally positive reception. Although sales were a bit light (roughly 4% growth), margins were quite good. Revenue was light relative to expectations across the board, as Humira and stent sales were slightly disappointing, but analysts didn't seem to care much, since margins were strong (leading to a one-cent earnings beat) and guidance was positive. (For related reading, see A Primer On The Biotech Sector.)

Read the full article at this link:
http://stocks.investopedia.com/stock-analysis/2012/Value-At-Abbott-Labs-Balances-A-Lot-Of-Growth-Optimism-ABT-PFE-AZN-NBIX0214.aspx

Investopedia: Dunkin' Brands Definitely A Hot Cup Of Coffee

2012-02-14T11:59:00.000-05:00

Quick service restaurants (QSRs) are hot today, but the stock of Dunkin' Brands (Nasdaq:DNKN) hasn't enjoyed as much of that love. While owners of McDonald's (NYSE:MCD), Yum! Brands (NYSE:YUM), Panera (Nasdaq:PNRA) and Starbucks (Nasdaq:SBUX) have all racked up double-digit gains over the past year, Dunkin' has been an under-performer.

The trouble for Dunkin' stock right now seems to be the trade-off between quality and value. There are a lot of things to like about the business model at Dunkin' Brands, but working off a demanding valuation may keep a lid on outperformance for a little while yet.

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http://stocks.investopedia.com/stock-analysis/2012/Dunkin-Brands-Definitely-A-Hot-Cup-Of-Coffee-DNKN-MCD-PNRA-SBUX0214.aspx

Seeking Alpha: Alexion Pharmaceuticals A Tricky Mix Of Biotech And Pharma

2012-02-14T07:52:00.000-05:00

Alexion (ALXN) has done what so few biotechs ever manage to do. Not only has the company successfully developed a drug, it has stayed independent and achieved profitability on its own. Now the company is in that tricky area grey area between biotech and pharma, an area that can be dangerous to valuations and new investors.

Soliris A Powerful Engine
The Alexion story today is all about Soliris, the company's drug for paroxysmal noctural hemoglobinuria (PNH) and atypical hemolytic uremic syndrome (aHUS). PNH and aHUS are uncommon diseases, but like Genzyme (before it was acquired by Sanofi (SNY)), Alexion has built a lucrative franchise around a unique drug that commands incredible pricing.

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Alexion Pharmaceuticals: A Tricky Mix Of Biotech And Pharma

Investopedia: Another Day, Another Deal For Oracle

2012-02-13T17:46:00.003-05:00

If growth through acquisition is supposed to be bad (as some academic types suggest), Oracle (Nasdaq:ORCL) CEO Larry Ellison very clearly doesn't care. Less than half a year after the $1.5 billion acquisition of RightNow, Oracle is at it again with the acquisition of cloud-based HR specialist Taleo (Nasdaq:TLEO).

The Deal
Taleo certainly cut to the chase in its PR announcement (titled "Oracle Buys Taleo"). The companies have reached an agreement on a deal that will see Oracle buy Taleo for $1.9 billion in cash. That values Taleo at $46 per share, or about an 18% premium to the prior day's close.

http://stocks.investopedia.com/stock-analysis/2012/Another-Day-Another-Deal-For-Oracle-ORCL-TLEO-SFSF-SAP-KNXA0213.aspx

Seeking Alpha: Zimmer Is A Pure Play On A (Presently) Rotten Market

2012-02-13T14:27:00.000-05:00

Waiting for a recovery in the orthopedics industry has been about as entertaining as watching paint dry, without the benefit of enjoying the fumes. Although it is certainly true that there are millions of Americans walking around on old knees and hips, and the number of 65+ year-old customers is on the increase, the reality is that a broadly favorable demographic push means nothing over the scale of a few years.

That makes Zimmer (ZMH) a tricky stock to assess. It certainly seems cheap relative to its likely future free cash flows, but the company's intense (70%-plus) exposure to hip and knee reconstruction is keeping a lid on enthusiasm in there here and now.

Read the full piece here:
Zimmer Is A Pure Play On A (Presently) Rotten Market

Investopedia: Emerson Is Better Than It Looks

2012-02-13T14:21:00.000-05:00

Industrial stocks certainly have their ups and downs as the economy goes through its cycles, but proven names like Danaher (NYSE:DHR), Illinois Tool Works (NYSE:ITW) and Emerson (NYSE:EMR) don't often trade at attractive multiples. With investors worried about Emerson's industrial automation and network power businesses, skeptical of its ability to recoup sales lost to a natural disaster, and generally bothered by any company with heavy exposure to Europe and/or China, now may be the time to fight the tide and consider these shares.

A Bad Quarter Was Expected, but This Was a Little Worse Still
Emerson warned the Street that this was not going to be a good quarter, and results were still a little shy of even those lowered expectations. Revenue fell 4% on an organic basis, as both network power and climate saw 10% declines in reported sales. Tools revenue was up slightly, but this is a tiny business. Industrial automation was a modest 2%, while process management was down a reported 1%.

Read the full article here:
http://stocks.investopedia.com/stock-analysis/2012/Emerson-Is-Better-Than-It-Looks--EMR-ABB-ROK-HON-SI-UTX-TYC0210.aspx

Investopedia: PepsiCo Needs To Go Further

2012-02-13T14:20:00.000-05:00

An eye on the future is all well and good, but Wall Street will pay relatively little for it if they fear that near-term execution will suffer as a result. Although PepsiCo's (NYSE:PEP) decisions in recent years to prioritize healthier foods may make sense in a world increasingly hostile to sodas and salty snacks, the fact remains that many analysts and investors are much more concerned about the the pace of share erosion today. Although PepsiCo's restructuring efforts announced with fourth quarter earnings are logical, there's a real risk that it's too little, too late.

Q4 On Target
PepsiCo didn't deliver too many surprises for the fourth quarter. Revenue rose 11% as reported and slightly surpassed the averaged analyst estimate. Real growth was more on the order of around 9%, though, as an extra week and foreign exchange both impacted reported results.

To read the full piece, please click below:
http://stocks.investopedia.com/stock-analysis/2012/PepsiCo-Needs-To-Go-Further-PEP-KO-KFT-K-COT0213.aspx

Investopedia: Cisco Sees Better Margins, Small Growth

2012-02-13T14:18:00.002-05:00

The challenge for Cisco (Nasdaq:CSCO) these days is pretty clear - show the Street that it can not only improve its margins, but also reignite growth and reclaim market share that it has lost to emerging competitors over recent years. Judging by the company's fiscal second quarter results, it looks like the company is making solid progress on the first goal, but has a ways to go on the others.

Better Than Expected Results for Fiscal Q2
Cisco did reasonably well relative to expectations for the second quarter. Revenue rose 11% from last year and 2% from the prior quarter to over $11.5 billion - beating the average analyst guess by a couple of percentage points.

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http://stocks.investopedia.com/stock-analysis/2012/Cisco-Sees-Better-Margins-Small-Growth-CSCO-JNPR-HPQ-FFIV-RVBD0213.aspx

Investopedia: Genesee & Wyoming An Uncommon Growth Story

2012-02-13T13:42:00.002-05:00

Genesee & Wyoming (NYSE:GWR) is certainly not a regular rail story. Unlike Class 1 railroads like Union Pacific (NYSE:UNP) or Norfolk Southern (NYSE:NSC), acquisitions are a significant part of the growth story and foreign operations are key to the company's future. Also, unlike many rails, investors are willing to pay a pretty hefty multiple to own this railroad.

A Mixed End to 2011
Genesee & Wyoming's earnings for the fourth quarter were relatively mixed. Revenue was pretty good, as reported revenue rose 24% and "same rail" revenue climbed 8%. Although carload volume was modest, yield was up nicely.

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http://stocks.investopedia.com/stock-analysis/2012/Genesee--Wyoming-An-Uncommon-Growth-Story-GWR-UNP-NSC-BHP0213.aspx

Investopedia: Can Diageo Keep The Party Going?

2012-02-13T13:41:00.000-05:00

Right now is a pretty good time to have a global business with valued brands and pricing power. Recent years have proven that demand for spirits is not as inelastic as once conjectured, but Diageo (NYSE:DEO) has nevertheless been a popular stock in a nervous market. Curiously, even as the investors in 2012 have shown more interest in risky names, Diageo has maintained its momentum. The question for investors is how much room is left in this run.

A Strong Fiscal First Half
So far, so good when it comes to Diageo's relatively ambitious targets for 2012. Organic revenue grew 7% for the first half and while the quarter-by-quarter performance was a little unbalanced (almost twice as much growth in the first quarter), underlying growth was consistent in both. As was the case for Coca-Cola (NYSE:KO) and PepsiCo (NYSE:PEP), 3% volume growth seems like the magic number this quarter.

Read more here:
http://stocks.investopedia.com/stock-analysis/2012/Can-Diageo-Keep-The-Party-Going--DEO-KO-BUD-BEAM0213.aspx

Seeking Alpha: Hope Springs Eternal At Ingersoll-Rand

2012-02-10T19:17:00.001-05:00

By and large, sell-side analysts can be a vengeful lot. Companies that make them look bad by over-promising and under-delivering often get stuffed into the penalty box and forced to do penance for a time. That doesn't seem to be the case with Ingersoll-Rand (IR), though, as this company enjoys a surprising amount of sell-side support - at least surprising relative to the company's performance in recent years. (See earnings call transcript.)

A Pretty Mediocre End To The Year
Ingersoll-Rand announced that reported revenue fell more than 5% in the fourth quarter, though organic/"core" revenue was actually up slightly (on the order of 1-2%). Even still, the company did come up a little short.

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Hope Springs Eternal At Ingersoll-Rand

Investopedia: Glatfelter Worth A Closer Look

2012-02-10T16:59:00.001-05:00

Investors who are familiar with my writing know that I love companies that look like they should be just commodity companies, but actually have fairly interesting businesses under their roofs. Glatfelter (NYSE:GLT) is a good example - while this company still is largely a paper company, it has also worked hard to diversify and reinvest cash flow into higher-growth markets. Although the stock is not tremendously cheap today, it definitely merits a spot on investor watchlists.

More Progress in the Fourth Quarter

Glatfelter is covered by just one sell-side analyst (Mark Wilde at Deutsche Bank), so discussions of financial performance relative to expectations have to be taken with more than just a grain of salt. That said, revenue growth of over 4% was fairly solid relative to its addressable markets.

Investopedia: PMC-Sierra May Have More Growth In Store

2012-02-09T20:58:00.001-05:00

It probably sounds like a double-whammy to consider a stock that is exposed to both the semiconductor cycle and the enterprise/carrier spending cycle as well. For better or worse, that's the situation for PMC-Sierra (Nasdaq:PMCS) as the veteran semiconductor company continues to leverage itself to emerging growth opportunities in storage and cloud computing while balancing out its legacy businesses in optical networking and wireless infrastructure.

Another Chip Company with Tough Q4 Numbers

It's not exactly challenging to find semiconductor companies that had some weak spots in their December quarter reports. Consequently, PMCS is not exactly in rare company with a quarterly report that was just a little light.

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http://stocks.investopedia.com/stock-analysis/2012/PMC-Sierra-May-Have-More-Growth-In-Store-PMCS-LSI-IBM-BRCM-QCOM-MRVL-DELL0209.aspx

Investopedia: Sysco Not Exactly Feasting

2012-02-09T17:49:00.004-05:00

It's a little scary when even some of the most efficient operators have difficulties cutting their costs enough to keep growing. That would seem to be the case today with Sysco (NYSE:SYY). It seems odd to read analysts criticizing Sysco's cost structure, but the reality is that growth has become more challenging for this proven dividend champion.

Costs Chewing into Profits
Sysco posted revenue growth of over 9%, but that number is a little misleading. Two-thirds of the company's growth was a byproduct of food cost inflation and actual case volume growth was more on the order of 3% with real organic growth closer to 2%. (For related reading, see What You Should Know About Inflation.)

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http://stocks.investopedia.com/stock-analysis/2012/Sysco-Not-Exactly-Feasting-SYY-UNFI-SVU-TSN-MCD0209.aspx

Investopedia: Yum! Brands Gives Its Skeptics Indigestion

2012-02-09T17:48:00.003-05:00

Looking back, maybe it's not so hard to see why quick-service restaurants would do well in a tougher economy, but the performance of the top brands has been nothing less than blistering. In the case of Yum! Brands (NYSE:Yum), the story continues to be all about China. With Yum! still set on turning China into a fast food nation, it would be dangerous to assume that the company's remarkable growth is due to slow anytime soon. (For related reading, see Investing In China.)

Q4 Earnings Trade a Little Margin for Growth
There was no question that Yum! Brands saw fine growth in the fourth quarter. Total revenue rose 15%, with reported U.S. revenue down a little (though up in the mid-single digits on an adjusted basis), International up about 7% and China up a torrid 39%. Not surprisingly, same-store sales show a similar breakout - China's same-store sales growth was an eye-popping 21%, while International growth was much more modest (up 3%) and U.S. results were fairly soft (up 1%).

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http://stocks.investopedia.com/stock-analysis/2012/Yum-Brands-Gives-Its-Skeptics-Indigestion-YUM-MCD-SBUX-PNRA-ARCO0209.aspx

FinancialEdge: If The U.S. Was A Real Household

2012-02-09T16:12:00.002-05:00

There's no question that discussions about the deficit and debt dominate coverage of the United States federal government - especially during an election cycle. It's easy to get overwhelmed by the numbers to the point where they become simple abstractions. Let us consider, then, what the fiscal state of the U.S. looks like in terms of numbers that are a bit more relatable to everyday experience.

The Bare Numbers
I recently saw a picture sent around Facebook that portrayed U.S. government finances in a simplified form that dropped eight zeros from the numbers. Do that for the 2012 budget that Obama proposed and you get the following:

Income - $26,270
Expenses - $37,290

That means that the U.S. has to borrow $11,020 (or almost half of its income) to pay its bills.

To read the full piece, please click here:
http://financialedge.investopedia.com/financial-edge/0212/If-The-U.S.-Was-A-Real-Household.aspx#axzz1lpJam3d6

Seeking Alpha: Sanofi's Balanced Model Looks Undervalued

2012-02-09T16:06:00.000-05:00

There has always been a certain boom/bust aspect to the branded drug business, but French drug giant Sanofi (SNY) seems to be trying a different path. Instead of a narrow focus, Sanofi has a business that is diverse both in markets and geographies served. Instead of a pipeline built around blockbuster home run stocks, Sanofi seems to be focusing on steadily banging out singles and doubles. Time will tell if this different approach will work, but the valuation certainly merits a closer look.

A Solid Close To The Year
Sanofi ended the year on a relatively strong note, with revenue growth and margin performance that was broadly clean and in line with expectations. Reported revenue rose about 9%, with better than 10% growth in pharmaceuticals, 10% growth in animal health, 13% growth in consumer, and 16% growth in generics offset an 8% revenue decline in vaccines. It should be noted, though, that "growth" in pharmaceuticals did have a great deal to do with the inclusion of Genzyme (which itself grew about 1% this quarter).

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Sanofi's Balanced Model Looks Undervalued

Investopedia: Coca-Cola Still Priced For Premium Performance

2012-02-09T12:33:00.000-05:00

For a company with the quality and history of Coca-Cola (NYSE:KO), opportunities to buy in cheaply don't come often. Based on solid ongoing performance and global growth potential, this is not one of those rare down periods at Coke. That leaves investors with the unenviable choice of looking for the cheaper stocks of lesser companies, or accepting less than expected return in Coke shares.

Familiar Themes In the Fourth Quarter
Even with the acquisition of Coca-Cola Enterprises clouding some of the comps, there weren't any major surprises in Coca-Cola's underlying performance. Global revenue rose a little more than 5%, fueled in part by worldwide volume growth of 3%. By the standards of other global food and beverage companies like Nestle (OTCBB:NSRGY) or Kraft (NYSE:KFT), that's pretty respectable growth and Coke did see double-digit volume growth in China.

Read the full piece here:
http://stocks.investopedia.com/stock-analysis/2012/Coca-Cola-Still-Priced-For-Premium-Performance-KO-PEP-KFT-MNST0209.aspx

Seeking Alpha: Accuray Fixing The Margins, But Where's The Growth?

2012-02-09T10:14:00.002-05:00

Med-tech companies don't fix themselves overnight, but Accuray (ARAY) management deserves real praise for how quickly it has addressed one of the biggest challenges of the TomoTherapy acquisition. That said, the overall system growth for this company is not yet where it needs to be and Accuray remains a "show me" story in small-cap med-tech.

A surprisingly strong fiscal second quarter
Although pro forma revenue did decline 11% this quarter, Accuray beat the average sell-side estimates for the quarter. Although adjusted product revenue fell 23%, service revenue climbed 17% from last year. The decision of Siemens (SI) to exit the linac market already seems to be paying some dividends in terms of incremental equipment placements for Accuray.

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Accuray Fixing The Margins, But Where's The Growth?

Seeking Alpha: An Unexpected Change In Leadership At Stryker

2012-02-09T10:13:00.000-05:00

Management matters in every industry, and there's no question that Stryker (SYK) has benefited from a long run of quality CEOs. In a fairly shocking announcement Wednesday night, Stryker announced that CEO Stephen MacMillan was resigning (effective immediately) for unspecified family reasons. Not only had MacMillan been a very good CEO for Stryker, but the company now finds itself looking for a new top kick at a time when it is still trying to work itself out of a slump in orthopedics and execute on some reasonably ambitious quality improvement and cost-cutting targets for 2012.

Read more here:
An Unexpected Change In Leadership At Stryker

Seeking Alpha: Multi-Coloar Got Too Hot, But Still Has A Solid Future

2012-02-09T07:41:00.000-05:00

Like any investor, I like seeing the stocks I buy for my portfolio go up. I do get a little nervous, though, when they seem to go too far too fast and that was recently true for the relatively unknown label manufacturer Multi-Color (LABL).

In the last few weeks, investors seem to have realized that expectations were getting a bit too hot for this company and the stock sold off. Matters were likely not helped any by the relatively low sales volumes reported by major consumer goods companies (and LABL customers) like Procter & Gamble (PG) and SAB Miller (SBMRY.PK). Top that off with a superficially disappointing quarter, a relatively thin float and little sell-side support and it wasn't too surprising to see the stock pull back on earnings.

Read the full article here:
Multi-Color Got Too Hot, But Still Has A Solid Future

Seeking Alpha: Trying Not To Get Fooled Again On Colfax

2012-02-08T19:20:00.000-05:00

It's bad enough to be wrong about a stock and miss the opportunity to log significant capital gains. It's even worse to try to over-correct for the mistake, buy too late, and rack up capital losses because you chased a good company with a hot stock.

That's the conundrum before me with Colfax (CFX). I not only like the company's exposure to the industrial and energy pump and valve markets, but also happen to think that the acquisition of Charter (and its ESAB welding/cutting business) will be very successful. The key questions, though, revolve around how quickly Colfax management can drive opportunity improvements at ESAB, how far those improvements can go, and how much of that is already captured by today's stock price.

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Trying Not To Get Fooled Again On Colfax

Seeking Alpha: GlaxoSmithKline A Good Mix Of Income And Opportunity

2012-02-08T18:55:00.000-05:00

There are relatively few drug companies that offer a truly balanced opportunity for investors. In many cases investors have to factor in the risk of significant near-term patent losses or uninspiring (or highly risky) pipelines. GlaxoSmithKline (GSK) is something of an exception in that regard. Although the near-term growth outlook is not blistering, Glaxo offers investors a good mix of capital appreciation potential, dividend income, and pipeline potential.

A Disappointing And Somewhat Confusing End To The Year
Due to a host of charges and items, Glaxo's fourth quarter results were messy and subject to a little more interpretation than usual. What was pretty clear, though, was that sales performance came up lacking. Revenue shrank about 2% in constant currency terms (below the expectation of 1% growth), with a sharp decline in vaccine sales the largest single culprit.

Sales of Advair were okay (though there was little growth), while smaller products like Avodart grew nicely. Glaxo had little to say about much-discussed Benlysta (which it sells under an agreement with Human Genome Sciences (HGSI), and HGSI had previously announced disappointing quarterly sales.

Follow this link for the full piece:
GlaxoSmithKline: A Good Mix Of Income And Opportunity

Investopedia: Weyerhaeuser Already Anticipating The Turn

2012-02-08T16:12:00.000-05:00

Maybe, just maybe, there are finally some signs of life in the U.S. residential construction market. Companies like Illinois Tool Works (NYSE:ITW) have seen some inklings of recovery and investors are slowly getting more optimistic. Be that as it may, though, shares in Weyerhaeuser (NYSE:WY) have already jumped more than 25% in the past couple of months on this improving outlook and that has taken a lot of the undervaluation out of the stock.

A Surprisingly Strong Fourth Quarter
Weyerhaeuser's fourth quarter results were actually pretty positive in a lot of respects. Total revenue did drop 3% from last year and about 2% from the prior quarter, but they nevertheless came in a little better than expected. Although the large wood products segment saw revenue fall 14% sequentially, cellulose fiber, real estate and timberlands were all up sequentially.

Read the full piece here:
http://stocks.investopedia.com/stock-analysis/2012/Weyerhaeuser-Already-Anticipating-The-Turn-WY-PCL-RYN-PCH-PG0208.aspx

Investopedia: Can Zoltek Keep The Wind At Its Back?

2012-02-08T16:00:00.000-05:00

Here's a little secret for investors looking to take big swings at potential multi-baggers: seek out small, poorly-followed, heavily-shorted stocks in out-of-favor industries. Pick the right one at the right time and the gains can be tremendous. That was shown yet again last week as carbon fiber producer Zoltek (Nasdaq:ZOLT) obliterated analyst expectations and reignited hopes that wind power and green power stocks may have a better 2012 in store.

Great Results Across the Board

Zoltek is followed by just three analysts, and we're not exactly talking about Morgan Stanley or Barclays here, so "beating expectations" has to be taken with a grain of salt. Still, Zoltek reported that revenue rose 43% from last year and blew away the revenue estimate by 30% as the company saw a 33% jump in shipment volume.

To read the full article, click the link:
http://stocks.investopedia.com/stock-analysis/2012/Can-Zoltek-Keep-The-Wind-At-Its-Back-ZOLT-AMSC-HXL-GE0208.aspx

Investopedia: Atmel's Ironic Warning

2012-02-08T15:59:00.000-05:00

Here's a riddle for investors: when is bad news actually good news? The answer: When the bad news is less bad than already feared. That very much seems to be the case for Atmel (Nasdaq:ATML) this Friday, as this small semiconductor's stock has actually held up quite well, despite a sizable revision to sales guidance for the fourth quarter.

The Bad News

Atmel announced that fourth quarter revenue was going to be approximately $384 million for the fourth quarter; not only down 20% from the third quarter, but quite a bit lower than the average analyst estimate ($412 million) and the lowest estimate ($403 million).

Please continue here:
http://stocks.investopedia.com/stock-analysis/2012/Atmels-Ironic-Warning-ATML-FCS-TXN-SYNA0207.aspx

Investopedia: January Rail Traffic Good For Industry, Not Great For Rails

2012-02-08T15:53:00.000-05:00

Rail traffic is a good economic indicator as it's such a major part of how raw materials and finished goods move around the country. Curiously, though, data can be good for the economy but not necessarily so good for the rail industry, and January was one of those months. That said investors should not yet be in any hurry to worry about the health of the rails in 2012.

Rail Growth Depends Where You Look
On an overall reported basis, U.S. rail traffic wasn't so special for the month of January. Carloads were up just barely on an annual basis, while traffic declined nearly 2% from December. Of the major reporting categories, only 11 were up in January (down from 15 categories a year ago and 16 in December).

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http://stocks.investopedia.com/stock-analysis/2012/January-Rail-Traffic-Good-For-Industry-Not-Great-For-Rails-UNP-NSC-CP-CNI0208.aspx

Investopedia: The Tyson Foods Story Still All About Optimism

2012-02-08T11:00:00.000-05:00

Generally speaking, investors should look to own agricultural stocks when things are about as bad as they can get and can only go up. When it comes to Tyson Foods (NYSE:TSN) there are indeed some areas that are performing relatively poorly, but the question remains whether today's valuation really represents a low-risk/high-reward set up.

Trading Costs for Price
Tyson posted some frankly blistering price increases for the fiscal first quarter. Reported revenue rose more than 9%, as the company traded a nearly 15% overall price increase with a 5% volume reduction.

Read more here:
http://stocks.investopedia.com/stock-analysis/2012/The-Tyson-Foods-Story-Still-All-About-Optimism-TSN-SFD-HRL-CAG0208.aspx#axzz1lZBmH4og

Seeking Alpha: Luminex Has A Lot To Live Up To

2012-02-08T06:54:00.000-05:00

I'm a sucker for a good gadget, but investors considering putting their money into Luminex (LMNX) may want to take a closer look at the business model and the current expectations. While Luminex does indeed have an interesting story to tell and growth potential in molecular diagnostics, valuation leaves little room for error.

A Quarter That Came In As Expected
For better or worse, there weren't a lot of surprises in Luminex's final quarter of the year. Overall revenue growth was as expected at 16%, though there was a little less in the consumables (down 16%) and royalties (up 17%) than investors may have wished. Although the company made up for that with strong assay sales (up 28% organically) and stable system revenue (up 1%), these are generally lower-margin businesses for the company.

To read more, click here:
Luminex Has A Lot To Live Up To

Seeking Alpha: Becton Dickinson Too Beloved For Now

2012-02-07T14:58:00.000-05:00

In a market that has offered up plenty of values in med-tech, investors may do well to draw lines between quality and value. There is no question that Becton Dickinson (BDX) is a very good (and very stable) company with substantial market share in a host of profitable sectors. The problem, though, is that there is no shortage of love for this name and no pressing need to buy the stock at current prices.

First Quarter Results Point To One Big Challenge
Perhaps the biggest issue for BD today is producing the sort of growth that it takes to get institutional investors excited and eager to push up the valuation. Reported growth in the fiscal first quarter was just 2.5%, which was at the high end of expectations, but not all that scintillating.

Growth was relatively well-balanced. The smallest division, Biosciences, was also the weakest, as growth was just about 1%. Medical and Diagnostics were relatively stronger, both growing about 3%. Encouragingly, two of the company's strongest business from a platform standpoint, diabetes and diagnostics, were also the strongest from a top-line perspective (growing 6% and 5%, respectively). At the same time, the 2% Med Surg growth was not so bad relative to low procedure counts and the numbers reported from the comparable units at Covidien (COV) and CareFusion (CFN).

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Becton Dickinson Too Beloved For Now

Investopedia: Cameron Waiting For The Subsea Story To Surface

2012-02-07T14:47:00.000-05:00

Tom Petty may have been onto something when he said that the waiting is the hardest part. Nobody seems to doubt that major oil companies will continue to invest billions of dollars into offshore oil and gas exploration and production, or that Cameron (NYSE:CAM) will get it's share. The question, though, is how much of that business arrives in 2012 and 2013 and whether Cameron can regain its former position in its core markets.

A Pretty Solid Fourth Quarter
Historical numbers have only limited significance in oil service and equipment companies, so Cameron's strong fourth quarter results don't matter all that much. Revenue did rise from 12% last year and 21% from the prior quarter, with strong growth in Drilling and Production and Process and Compression.

Read more here:
http://stocks.investopedia.com/stock-analysis/2012/Cameron-Waiting-For-The-Subsea-Story-To-Surface-CAM-FTI-GE-PBR0207.aspx

Seeking Alpha: LHC Group - Beaten Up, But Addressing A Huge Growth Market

2012-02-07T14:41:00.000-05:00

The graying of America has been a theme in healthcare for at least the last 15 years, and I've seen analysts and investors apply it to med-tech companies like Johnson & Johnson (JNJ), insurance companies like UnitedHealth (UNH), and a host of other facility operators and service providers. It may be a trite theme at this point, but there is still an element of truth to it and patient investors may be able to ride LHC Group (LHCG) to its fruition.

A Growth Play In A Bad Neighborhood
It would be an understatement to say that home healthcare providers like LHC Group, Amedisys (AMED), Gentiva (GTIV), and Almost Family (AFAM) have been beaten up since 2010. Not only has the industry had to absorb cuts in reimbursement, but the entire industry has been under a regulatory cloud caused by accusations that these companies have fraudulently and illegally billed for unnecessary treatments.

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LHC Group - Beaten Up, But Addressing A Huge Growth Market

Seeking Alpha: FSI International - This Small Semiconductor Company Could Clean Up

2012-02-07T06:38:00.000-05:00

It has already been a fairly solid year for many companies in the semiconductor equipment space. With guidance from major players like Applied Materials (AMAT) and ASML (ASML) suggesting that dawn is breaking and the merger between Lam Research (LRCX) and Novellus (NVLS) hinting that business is getting back to normal, investors seem to be willing to consider risky stories again.

That could set up the right sort of one-two punch for investors in FSI International (FSII). Like many other small equipment vendors, FSI was hit hard by the downturn in equipment spending. Unlike some of those small peers, though, FSI is coming into a cyclical upswing with a new product and the potential for some real sales momentum. Couple that with the fact that this stock is barely followed and has about 10% short interest, and it may not take much for this stock to do even more in 2012.

Read more here:
http://seekingalpha.com/article/345591-fsi-international-this-small-semiconductor-company-could-clean-up

Seeking Alpha: A Battered Healthcare Play With Favorable Long-Term Demographics

2012-02-07T06:34:00.000-05:00

There is no point in sugar-coating it - 2011 was a disastrous year for home health providers following a terrible 2010. The entire industry is under pressure as Congress cuts Medicare reimbursement and looks to implement new rules and regulations to address and punish prior wrong-doing, while the overall economy applies its own pressures. Although Amedisys (AMED) has been hit hard, patient investors willing to take on the risk may see a multi-year turnaround story unfold here.

What Amedisys Does
Amedisys is the largest publicly-traded provider of home health care and hospice services. Active in 45 states (but focused on the East/Southeast), Amedisys operates over 500 facilities offering skilled nursing, home health aides, physical/occupational therapy, and specialty nursing services.

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A Battered Healthcare Play With Favorable Long-Term Demographics

Seeking Alpha: Rigel Pharma Has More Room To Run

2012-02-06T18:23:00.000-05:00

So far this has been a great year for biotech, as investors have been more than happy to look past the risks and embrace the opportunities in the pipeline. While Rigel Pharmaceuticals (RIGL) has certainly gone along for the ride, investors may yet have reason to think about adding shares of this potential star to their portfolio.

A One-Drug Story Today, But What A Drug
Teasing out biotech valuation is always a subjective exercise, but I don't think too many Rigel longs are going to quibble with the statement that R788 (fostamatinib disodium), also known as FosD, is a huge part of the company's current value.

FosD is an oral syk inhibitor that has shown very encouraging efficacy in rheumatoid arthritis. The potential of this drug early on was such that the company was able to sign a lucrative partnership with AstraZeneca (AZN) and the end of the pivotal development process is in sight.

Read more here:
Rigel Pharma Has More Room To Run

Investopedia: JDSU Still Predictably Unpredictable

2012-02-06T16:36:00.000-05:00

When I last wrote on JDSU (Nasdaq:JDSU) about a year ago, I pointed out that there were encouraging signs across the business, and that if this historically boom/bust company could show some consistency the stock could perform well. Flash forward one year: severe flooding did real harm to a contract manufacturer; weak carrier spending rippled through equipment providers; and just about everybody started to worry about the sustainability of tech hardware spending.

A Good Quarter, But ...

JDSU actually had a surprisingly strong fiscal second quarter. Operations in Thailand recovered faster than anticipated and the company's sequential revenue decline of 2% was considerably better than Street analysts had predicted. Still, it was a tough quarter. Test revenue did rise almost 6% from the preceding quarter, but optical components and advanced technologies both saw declines (nearly 10 and 3%, respectively).

Please follow the link for the full article:
http://stocks.investopedia.com/stock-analysis/2012/JDSU-Still-Predictably-Unpredictable-JDSU-FNSR-CSCO-DHR0206.aspx

Investopedia: Qualcomm's Growth Story Far From Over

2012-02-06T16:33:00.000-05:00

Having already built up a thumping market share in mobile baseband chips, maybe some think that Qualcomm's (Nasdaq:QCOM) growth prospects have to be shrinking as the law of large numbers takes hold. That looks like a hasty (not to mention wrong) analysis - not only is Qualcomm continuing to leverage its current market strength, but the company is looking to expand into new markets that should add billions to its addressable market opportunity.

A Strong Start to the Fiscal Year
Qualcomm reported that sales rose nearly 40% this quarter (and nearly 14% relative to the fiscal fourth quarter), beating the average analyst guess by more than $100 million. Both of the core businesses were strong - licensing saw revenue rise more than 36%, while the chip business had a gaudy 46% topline growth. MSM chip shipment rose 23% from the fourth quarter, and while the number of royalty-earning devices was a little shy of expectation, the average selling prices (ASP) have been stronger than forecasted.

Please read more here:
http://stocks.investopedia.com/stock-analysis/2012/Qualcomms-Growth-Story-Far-From-Over-QCOM-BRCM-TXN-MRVL0206.aspx

Investopedia: Whirlpool Not Just Another Doomed U.S. Manufacturer

2012-02-06T10:54:00.000-05:00

I've been curious about U.S. home appliance manufacturer Whirlpool (NYSE:WHR) for some time now; unfortunately standing on the sidelines while the stock soared immediately after the fourth quarter earnings. Although this company does have legitimately worrisome issues with margins, free cash flow conversion and foreign competition, skeptics may find that there's quite a bit more here than they assume.

Fourth Quarter Results Lukewarm
Whirlpool had something of a good news/bad news release for the fourth quarter. Reported revenue fell 3% (or 2% in constant currency terms) and that wasn't great. Although North America eeked out a 1% sales gain, results were weaker than expected in Latin America and Europe (down 1 and 7%, respectively, in constant currency). Curiously, shipments were remarkably consistent across Whirlpool's major segments - down 3% in North America and 4% in both Europe and Latin America.

Read more here:
http://stocks.investopedia.com/stock-analysis/2012/Whirlpool-Not-Just-Another-Doomed-U.S.-Manufacturer-WHR-GE-SHLD-LOW0206.aspx

Seeking Alpha: Hypermarcas May Be On Several Shopping Lists

2012-02-06T07:07:00.000-05:00

It's not uncommon for one company's failure to be another's opportunity. Built through aggressive acquisition, Brazil's Hypermarcas (HYPMY.PK) had leading brands in branded drugs, generics, personal care, home care, and food. Not so long ago, Hypermarcas looked like it was on the way to becoming Brazil's answer to Unilever (UL), Procter & Gamble (PG), or Johnson & Johnson (JNJ), but those plans have gone seriously awry.

Shrink To Survive
At the risk of oversimplification, Hypermarcas got too big too fast and pursued quantity (size) over quality. With a hefty amount of debt on the balance sheet, the company made itself vulnerable to performance shortfalls and that's exactly what happened.

Read the full piece here:
Hypermarcas May Be On Several Shopping Lists

Seeking Alpha: AstraZeneca - Solid Earnings Overwhelmed By An Uncertain Future

2012-02-03T16:31:00.000-05:00

It's no secret that Big Pharma companies live and die with their pipeline and their ability to drive sales from patent-protected branded drugs. Unfortunately, these two major drivers are both working against UK-based AstraZeneca (AZN). Although current results weren't bad and the company's valuation looks compelling by some metrics, management has a lot of work ahead of it in refilling its pipeline and maintaining its earnings base.

An All-Around Decent Q4, For What It Matters
AstraZeneca actually reported a respectable fourth quarter. Revenue was up slightly, beating the averaged expectation of a modest decline. Revenue in the U.S. was up 5%, offsetting a 15% decline in Western Europe tied in part to generic competition for Nexium. While total Nexium sales did decline 13% this quarter, other major products like Seroquel, Crestor, and Symbicort delivered double-digit sales growth, with Seroquel especially strong relative to expectations.

Read more here:
AstraZeneca - Solid Earnings Overwhelmed By An Uncertain Future

Seeking Alpha: CareFusion Deserves Another Chance

2012-02-03T15:45:00.000-05:00

By and large, it's hard to feel sorry for, or be patient with, companies where the wounds are largely self-inflicted. Still, when a company has significant market share in multiple markets of size, investors would do well to keep an eye on the story. To that end,
CareFusion (CFN) has disappointed investors recently, but the long-term potential of this company is still quite a bit more than is reflected in the stock today.

Not Many Surprises In The Second Quarter
Given that CareFusion warned about this quarter's results, there weren't a lot of surprises in store when the final results came out. Revenue rose a bit more than 3%, with organic revenue up a little less than 3%. Growth was led by a fine performance in Medical Systems; revenue rose more than 9% on solid growth across dispensing, infusion, and respiratory. Procedural was the problem child - sales fell 2% on an adjusted basis as decent ChloraPrep results (up 5-6%) were offset by weakness in various disposables.

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CareFusion Deserves Another Chance

Seeking Alpha: Merck Looks Likes A Name To Own In Drugs

2012-02-03T14:55:00.000-05:00

Roche (RHHBY.PK) was a good name to own throughout 2011 in large part because so little was expected from the company. Investors still looking to position their portfolio for 2012 may want to consider Merck (MRK) for similar reasons. Not only does Merck have a pretty tolerable patent cliff over the next three years, but the company's pipeline may yet be undervalued and under-appreciated.

Q4 Results: Good Margins On So-So Sales
Merck's fourth quarter was more or less fine. Revenue grew 2%, but came in about 2% light of average Wall Street guesses. Januvia was quite strong (revenue up 42%) and Singulair did well for a drug that is long in the tooth (up 8%), but Remicade was a little weak and the company did have to swallow a 15% drop in sales of Vytorin. Animal health and consumer sales were up 7% and 5%, respectively, but are relatively small businesses for Merck.

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Merck Looks Like A Name To Own In Drugs

Investopedia: Plum Creek Timber Looks For The Bottom In 2012

2012-02-03T11:25:00.002-05:00

Conditions in the timber industry haven't been getting better with any particular speed lately. Although multi-family housing construction is extremely strong, the single-family building and residential real estate development markets, that are so important to Plum Creek (NYSE:PCL), went basically nowhere in 2011. Although most analysts expect 2012 to be the low for the cycle, investors may yet want to ask themselves if Plum Creek is the way to play the eventual rebound.

A Decent Fourth Quarter, Relatively Speaking
Fourth quarter results were not that great for Plum Creek, but there was no particular expectation that they would be. Reported revenue dropped 12% as a 38% growth from the Northern business and 14% growth in manufacturing partially offset a 4% decline in Southern and a 40% decline in revenue from real estate operations.

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http://stocks.investopedia.com/stock-analysis/2012/Plum-Creek-Timber-Looks-For-The-Bottom-In-2012-PCL-RYN-WY-LPX0203.aspx

Investopedia: Arkansas Best Isn't The Best, But Is It This Bad?

2012-02-03T11:24:00.000-05:00

Although the trucking market may not be quite as attractive as rail, it's not terrible. Tonnage is increasing at a slower rate, but is still positive and likely to continue growing so long as the economy grows. Unfortunately, Arkansas Best (Nasdaq:ABFS) seems to be making a tough decision on price versus volume, and needs to show better margins to validate the choice.

A Disappointing Close to the Year
Of the three metrics that most transport investors place great importance on, Arkansas disappointed meaningfully on two. Revenue was up 5% in the quarter, but strong pricing (up almost 13% per hundredweight) was offset by very weak volume. Tonnage was down about 8% in the fourth quarter, and weakened as the quarter went on. Given the overall tonnage trends, it looks as though Arkansas Best may have priced itself out of some business.

To read more, please click below:
http://stocks.investopedia.com/stock-analysis/2012/Arkansas-Best-Isnt-The-Best-But-Is-It-This-Bad-ABFS-ODFL-FDX-SWFT0203.aspx

Investopedia: Advanced Energy Industries Can Ride The Semi Recovery

2012-02-03T11:22:00.000-05:00

There are more than a few signs of life in the semiconductor world these days. The real question, though, is when the fabs and OEMs feel enough confidence to start ordering significant amounts of equipment again. As more of a "when" question than an "if" question, patient and risk-tolerant investors can yet hope to see more growth and gains in Advanced Energy Industries (Nasdaq:AEIS).

A Tough, but as Expected, Fourth Quarter
Business is definitely challenging these days for AEIS, but not really any more so than the company had led investors to expect. Revenue dropped 24% this quarter relative to last year and 12% relative to the third quarter, as ongoing weakness in the thin film business (down 30% sequentially) offset 12% growth in inverters.

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http://stocks.investopedia.com/stock-analysis/2012/Advanced-Energy-Industries-Can-Ride-The-Semi-Recovery-AEIS-PWER-MKSI-SI0203.aspx

Seeking Alpha: Kellogg's Curious Quarter

2012-02-02T19:28:00.000-05:00

Just as Kellogg (K) investors were getting used to the idea that 2012 was going to be a year of somewhat depressed results and necessary reinvestment, Kellogg posted a rather curious quarter. Though this company is still one of the best names in food to own for the long haul, investors with more short-term concerns had best be ready for some potentially choppy results this year.

Surprising Strength To Start The Fiscal Year
Revenue at Kellogg was a little stronger than expected, growing about 6% on an internal basis. Arguably the biggest surprise is that the company was able to balance a better than 6% boost in prices with less than 1% volume erosion. Growth was strong in both North America (up nearly 7%) and Latin America (up more than 10% in constant currency), while Europe was down about 1%. Internal growth of more than 8% in Asia was likewise a solid result.

Read the complete piece here:
Kellogg's Curious Quarter

Investopedia: Fortinet Secures Another Beat

2012-02-02T15:33:00.000-05:00

All an investor in high-multiple stories can ask for is a continuation of a strong growth story, complimented with beat-and-raise quarters. Luckily, Fortinet (Nasdaq:FTNT) provided that in the fourth quarter. While there's still a lot of growth potential in security appliances, investors may want to ask themselves just how much success is already built into this stock.

Nothing Really Amiss in the Fourth Quarter
Fortinet's growth story continued apace in the fourth quarter. Reported revenue rose 29% this quarter (and 4% from the third quarter), as product led the way (up 40 and 8%) over services (up 27 and 6%). Just as important is deferred revenue that rose 17%, while billings were up 27% - accelerating from the 25 and 23% growth seen in the third and second quarter, respectively.

Read the full piece here:
http://stocks.investopedia.com/stock-analysis/2012/Fortinet-Secures-Another-Beat-FTNT-CSCO-CHKP-JNPR0202.aspx

Seeking Alpha: Cummins Earnings Show The Company Has Another Gear

2012-02-02T13:59:00.000-05:00

Underestimate Cummins (CMI) at your own risk. Although there has been plenty of talk about how tough conditions in Europe and China's inflation fears will lead heavy machinery demand to stagnate, companies like Caterpillar (CAT), Eaton (ETN), and PACCAR (PCAR) keep reporting an inconvenient truth that business is holding up pretty nicely. Much as I admit buying a cyclical industrial like Cummins at these levels makes me nervous, it's hard to argue with the performance and the potential.

A Mostly Solid Fourth Quarter
All in all, Cummins handily surpassed analyst expectations for the quarter. Revenue rose 19% (and 6% sequentially) and beat the average Wall Street guess by almost 5%. Growth was led by a very strong result in engines, where top-line growth was 23% and external growth was 25%. Components also did well, growing 19% this quarter. Power was the laggard, though, and up just 2% while distribution revenue rose 19%.

To read more, please follow this link:
Cummins Earnings Show The Company Has Another Gear

Seeking Alpha: Boston Scientific - Struggles Today, Still Hope For Tomorrow?

2012-02-02T08:42:00.000-05:00

The seemingly never-ending road to recovery just got a little longer for Boston Scientific (BSX). Although this long-struggling med-tech name has been making some progress in restructuring its businesses and cost structure, fourth quarter earnings highlight that growth and competition are still pressing worries. Though BSX has a fairly deep pipeline, patient investors ought to ask themselves if the company will be able to gain and hold real share in these emerging growth markets.

Q4 Earnings Show Blemishes On The Crown Jewels
Boston Scientific reported that total revenue declined 8% in constant currency terms this quarter, with 5% erosion in the core businesses. Not only was this more than 3% below the average estimate, it was beneath the bottom of the range.

Worse yet, the company was weakest in its largest and most significant businesses. Cardiac rhythm management sales were down 15% (missing estimates by more than 5%) and ICD sales were down 18% - much worse than the recently-reported results at St Jude (STJ) and strongly suggestive that BSX continues to cede share to St Jude and Medtronic (MDT).

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Boston Scientific: Struggles Today, Still Hope For Tomorrow?

Seeking Alpha: Roche's Earnings Show Real Progress

2012-02-02T06:18:00.000-05:00

For much of 2011, Roche (RHHBY.PK) was the red-headed stepchild of the Big Pharma world. Recently that started to change as Wall Street believed that the company had put most of its bad news behind it and was in position to once again deliver lucrative (if not especially torrid) growth. With the recent hostile bid for Illumina (ILMN) distracting investors though, some of that progress is overshadowed by the risk that Roche will overpay and redeploy too much cash away from shareholders.

A Surprising Surprise To Close The Year
Although the fact that Roche produced fourth quarter revenue about 2% ahead of expectations may not qualify as much of a surprise, the fact that it surprised at all is the surprise - a top-line revenue beat has been more than a year in coming. The Pharma business grew about 3% this quarter in constant currency, while the diagnostics business delivered a surprisingly strong 7% sales increase.

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Roche's Earnings Show Real Progress

Investopedia: No Quick Fixes At ADM, But The Value Is There

2012-02-01T18:55:00.000-05:00

A quarter ago I was pretty positive on the shares of Archer Daniels Midland (NYSE:ADM). This was not so much because I saw a dramatic turnaround coming in the business, but because I saw it as a good long-term value. Although fiscal second quarter earnings show that there are still some very real challenges, investors really haven't hurt themselves by owning these shares as a long-term value.

Another Difficult (and Complicated) Quarter
All in all, the fiscal second quarter was not very good for ADM. Reported revenue did rise 11% and the company posted gaudy-looking growth in oilseeds processing (up 28%) and corn processing (up 29%), while the huge ag services business saw a 1% sales decline.

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http://stocks.investopedia.com/stock-analysis/2012/No-Quick-Fixes-At-ADM-But-The-Value-Is-There-ADM-BG-CPO-MBLX0201.aspx

Seeking Alpha: Pfizer Looking More And More Like A Dependable Company

2012-02-01T17:31:00.000-05:00

There is no point in asking if a Big Pharma company will go through its trial by fire (or trial by patent cliff, if you prefer), it's just a question of when. Although Pfizer (PFE) is not exactly in the clear with all of its patent cliffs, most of the damage has been done and Pfizer has emerged as a leaner, more profitable, and ultimately more interesting major drug company.

Decent Results For Q4
Some of the company's progress shows through in fourth quarter results. Revenue was down 5%, but still fared better than most analysts expected. Certainly the drug business needs more help; revenue was down 6% as reported, with U.S. sales down 15% due in large part to declining sales of Lipitor (now off patent). Ancillary businesses were fairly strong though, as animal health grew 13%, consumer products grew 8%, and nutrition grew 22%.

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Pfizer Looking More And More Like A Dependable Company

Seeking Alpha: Illinois Tool Works Tries To Change With The Times

2012-02-01T16:11:00.000-05:00

Changing a successful model is a risk that most corporate executives simply don't have the guts to take. Make no mistake, while Illinois Tools Works' (ITW) heavy reliance on serial acquisitions and its decentralized structure break a lot of how-to rules they teach in business school, the results have been good. Companies like Dover (DOV) and Ingersoll Rand (IR) have closed some of the market outperformance gap in recent years, but ITW has still done well by investors over almost any long-term time horizon.

Then again, maybe that shrinking margin of outperformance is a good reason for the company to think about altering the plan a bit.

Respectable Results In Place Of Rumor
Although the whisper numbers on Illinois Tool Works were not especially strong going into the quarter, the company's results were just fine. Reported revenue growth came in over 10%, while organic growth was nearly 6%. Although ITW's exposure to short-cycle European end-markets was (and remains) a concern, organic growth over there was better than 2% (while growing nearly 9% in North America and better than 9% in China).

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Illinois Tool Works Tries To Change With The Times

Investopedia: Eastman Chemical Seems To Get The Long-Term Picture

2012-02-01T15:46:00.000-05:00

It's interesting that Eastman Chemical (NYSE:EMN), Eastman Kodak's discard, is going to be the company that survives as the more viable going concern. To management's credit, they seem to understand the value of defensible markets and the need to wall off and dispose of businesses in long-term decline. With the announced acquisition of Solutia (NYSE:SOA), Eastman Chemical is taking another important step towards being a diversified specialty chemical company.

Is Solutia the Solution?
Eastman is paying about $4.7 billion in total enterprise value for Solutia, or about nine times trailing EBITDA. That's not an especially cheap price, but it's not so unusual for a takeout of a quality specialty chemical name. When Berkshire Hathaway (NYSE:BRK.A) acquired Lubrizol, the premium it paid was only about 80% less even though that was a very different market at the time. (For related reading, see EBITDA: Challenging The Calculation.)

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http://stocks.investopedia.com/stock-analysis/2012/Eastman-Chemical-Seems-To-Get-The-Long-Term-Picture-EMN-SOA-BRK-A-DD-DOW0201.aspx

Seeking Alpha: Lilly Has Earned Its Lousy Rep

2012-02-01T14:51:00.000-05:00

There don't seem to be very many pharmaceutical companies less-liked than Eli Lilly (LLY). There's a long tradition here of blaming others for their problems (the government and prior management teams, especially), designing trials poorly, and generally mismanaging the pipeline to say nothing of the expense structure. Said differently, Lilly doesn't have one of the highest dividend yields in Big Pharma because its payout ratio is high.

A Little Good News In Q4
Against that dour intro, Lilly had a pretty respectable fourth quarter with a few catches. Revenue declined 2% overall as strong volume growth (8%) was buried by price erosion (11%). Pharmaceutical sales fell 4%, with sales in the U.S. down 6% (despite a 11% volume increase). Lilly's good quarter largely came down to strength in the diabetes franchise (which is definitely a positive) and less-than-expected erosion of the now off-patent Zyprexa.

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Lilly Has Earned Its Lousy Rep

Investopedia: Is There Enough Economic Growth To Push Olin Higher?

2012-02-01T13:59:00.002-05:00

The easy days are long over for companies that represent leveraged plays on economic growth. There may still be a feeling of general malaise and disappointment in the economic recovery, but the numbers are what they are and economic activity is strongly up off the bottoms. That represents a problem for Olin Corp (NYSE:OLN), as this chemical manufacturer has enjoyed a solid recovery from the depths of the recession, but now has to find a way to maintain the momentum.

A Mixed Fourth Quarter
All in all, Olin's performance for the fourth quarter was fairly mixed. Revenue rose about 16% as the company offset lower volume in chloralkali and caustic potash with higher netbacks. The company's operating rate was a disappointing 70%, though, and well below industry averages for the quarter.

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http://stocks.investopedia.com/stock-analysis/2012/Is-There-Enough-Economic-Growth-To-Push-Olin-Higher-OLN-OXY-PPG-WLK0201.aspx

Investopedia: Everybody Loves Broadcom, And Maybe You Should Too

2012-02-01T13:58:00.000-05:00

Normally I get skeptical whenever I see a stock uniformly supported by major Wall Street firms. After all, if a dozen major analysts are already out there pounding the table, how much good news is left undiscovered and unappreciated? In the case of Broadcom (Nasdaq:BRCM) the answer may well be "more than you think" as the company continues to leverage good technology into more new products and markets.

A Pretty Good End to the Year
Although December was the winter of discontent for chip companies, Broadcom actually did pretty well all things considered. Revenue did fall about 7% on both an annual and sequential comparison. The company's mobile/wireless business was strongest (down 4 and 7%, respectively), while broadband (down 12 and 3%) and infrastructure (down 7 and 13%) were weaker.

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http://stocks.investopedia.com/stock-analysis/2012/Everybody-Loves-Broadcom-And-Maybe-You-Should-Too-BRCM-QCOM-AAPL-CSCO0201.aspx

Seeking Alpha: Can Align Technology Fix The Gap In Its Valuation?

2012-01-31T20:10:00.000-05:00

Although I'm quite willing to bemoan the lack of good growth stories in med-tech today, the reality is that it's not so much a lack of good growth stories as a lack of good undervalued growth stories that is the problem. Align Technology (ALGN) is a good case in point. While this company has a lot of things going for it - including market share, under-penetrated markets, and good profits - valuation has caught up with the shares and company guidance is denting some of its growth expectations.

A Good Quarter, But ...

Align did what it needed to do for the fourth quarter, and then a little extra. Revenue was a bit ahead of expectations and grew 39% from the year-ago quarter (and more than 2% from the third quarter). This overstates things a bit because of the Cadent acquisition, but core Invisalign revenue was up 28%. Case volume growth in the Invisalign business was an impressive 30% and more than offset weakening ASPs.

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Can Align Technology Fix The Gap In Its Valuation?

Seeking Alpha: Skepticism Still Working For Hologic Investors

2012-01-31T18:04:00.000-05:00

Investors should always be a little leery of seeing too much love and praise for their holdings; having a few skeptics left to convince leaves some upside. Although Hologic (HOLX) shares have come up nicely in the past quarter, there is still a lot of growth potential in the earnings and in the stock.

Beat, Raise, Rinse, Repeat
Hologic has established a decent track record of slightly outperforming expectations and this fiscal first quarter continued that trend. Revenue rose a little more than 9% this quarter, slightly topping the average guess, as the company logged 10% or better sales growth in its breast health, diagnostics, and skeletal businesses. GYN Surgical was the laggard, with less than 4% growth over last year.

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Skepticism Still Working For Hologic Investors

Seeking Alpha: Danaher Gets Its Ducks In A Row

2012-01-31T16:21:00.000-05:00

Some stocks really test value discipline. Investors don't often get a chance to buy Danaher (DHR) shares at especially attractive prices. In fact, it's about a once a year opportunity. With the strong rebound in the shares since the summer of 2011, valuation has become tricky in what is one of the better-run conglomerates around.

Growth A Little Light, Margins Quite Strong
Danaher's quarter was a little mixed, but only in the context of a stock where the expectations are always pretty substantial. Core revenue rose 4% this quarter, with the strongest organic growth coming from life sciences (up 6%) and environmental (up more than 5%). Significantly, all reporting units delivered organic growth this period.

All in all, margins were quite good this quarter. True, gross margin did drop about 250 basis points but that was already widely expected. What was not expected was the 16.5% reported operating margin, nor the segment operating margin of 17.2% - both about half a point better than most sell-side analysts had forecast.

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Danaher Gets Its Ducks In A Row

Seeking Alpha: If High Steel Prices Stick, U.S. Steel Has A Lot Further To Go

2012-01-31T15:55:00.002-05:00

All you really need to know about whether U.S. Steel (X) stock will outperform this year is how strong steel prices will be. Simple, right? If only. Although steel prices have been heading higher in recent weeks and commentary from top mini-mills Nucor (NUE) and Steel Dynamics (STLD) has been constructive, there more than a few worries about the health of key markets like autos, construction, and energy.

A Tough Q4, But Who Cares?
By and large U.S. Steel had a disappointing quarter. Sales climbed 12% from last year, but dropped 5% from the third quarter. Shipment volume wasn't bad (especially in flat roll), but pricing was a little disappointing outside of the flat roll business. Worse, costs were quite a bit higher despite improved utilization and overall segment operating profit wasn't a profit at all. At the bottom line, U.S. Steel missed analyst expectations by a fairly significant amount.

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If High Steel Prices Stick, U.S. Steel Has A Lot Further To Go

Investopedia: Altria's Ever-Shrinking Window

2012-01-31T10:59:00.000-05:00

It's probably foolish to think that smoking will ever go away entirely. The health risks have long been decided, but people have their vices and smoking has long been among them. That said it seems like governments around the world are on the same page when it comes to reducing the number of places people can smoke, and increasing the cost of doing so. That suggests an ever-shrinking window for Altria (NYSE:MO), but investors can likely wring a great deal of cash flow for many years to come.

Year-End Results Come in as Expected
Altria's earnings are often a mess, but the company's fundamental performance was more or less in line with expectations. Revenue net of excise tax rose 5%, as weaker cigarette volumes were offset by better performance in smokeless tobacco.

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http://stocks.investopedia.com/stock-analysis/2012/Altrias-Ever-Shrinking-Window-MO-RAI-BTI-ITYBY.PK0131.aspx

Seeking Alpha: ABB-Thomas & Betts Deal Is A Good One

2012-01-30T19:12:00.002-05:00

Swiss multinational industrial company ABB (ABB) has been teasing investors for a little while now. While management has done a laudable job of cutting costs, seemingly everyone has been waiting for announcements with a little more "oomph" -- specifically, deals that can goose the company's growth rate. After more than a few near-misses, ABB found a deal that should make investors happy, as Thomas & Betts (TNB) looks like the right company at the right price.

The Deal To Be
The boards of ABB and Thomas & Betts have agreed on a deal that (if approved by shareholders) will see ABB acquire the company for $3.9 billion in cash. That works out to $72 per share and a 24% premium to Friday's close. In paying over 10 times EBITDA, ABB is hardly fleecing Thomas & Betts shareholders, especially considering that this company has struggled to produce consistently good returns on capital. Nevertheless, there are some definite synergies that should reduce the effective cost to ABB, as well as the prospects of an eventual recovery in the construction markets that make up a sizable percentage of Thomas & Betts' business.

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ABB-Thomas & Betts Deal Is A Good One

Seeking Alpha: Okay, ISTA Management, It's Time To Step Up

2012-01-30T14:16:00.000-05:00

Successfully repelling an unsolicited bid is, and should be, a mixed blessing for any company. In the case of ISTA Pharmaceuticals (ISTA) and Valeant (VRX), it's pretty clear that Valeant was attempting to exploit investor fatigue and pessimism with a low-ball bid. Now that Valeant has retreated, it falls on management to show that they can deliver on that value that they claim Valeant (and, by implication, the broader stock market prior to the bid) failed to recognize.

Valeant Steps Away
Valeant had always said that its $7.50/sh bid for ISTA had a lit fuse attached (an expiration date of January 31), and management decided to pull it a day early. Management at Valeant claimed that this was due to a "lack of progress." But the reality is that ISTA was doing exactly what it said it would do - shopping around for a better offer.

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Okay, ISTA Management, It's Time To Step Up

Investopedia: Colgate-Palmolive Has Growth, But It'll Cost Ya

2012-01-30T11:57:00.000-05:00

Perhaps there's nothing better today than a company that is logging very good growth with a set of products that are widely seen as economically-insensitive, day-to-day essentials. That has to be at least some of the explanation for the valuation of Colgate-Palmolive (NYSE:CL). For while this is absolutely an excellent company and a worthy buy-and-hold candidate for dividend-inclined investors, today's price is certainly no bargain.

Q4 Results - Good Growth, the Worst of the Margins?

Colgate-Palmolive reported revenue growth of nearly 5%, with organic growth of 6% split evenly between volume and price. Oral/personal care (which is the overwhelming bulk of sales) had reported sales growth above 5%. By region, North America saw marginal growth (3.5%), while Europe was actually down 2% on an organic basis. Latin America and Asia/Africa both posted double-digit organic revenue growth. (For related reading, see Analyzing Operating Margins.)

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http://stocks.investopedia.com/stock-analysis/2012/Colgate-Palmolive-Has-Growth-But-Itll-Cost-Ya-CL-PG-UL-JNJ0130.aspx

Investopedia: Nucor's Rally Leaves Little On The Table

2012-01-30T11:51:00.000-05:00

Since the title of this article largely hints at the conclusion, let me make it clear that I think Nucor (NYSE:NUE) is one of the best commodity companies in the world and maybe one of the best-run companies in the country. The question for 2012, then, is whether the market for steel products can develop even more favorably than a generally bullish chorus analysts already expect.

2011 Ends on a Shrug
Although Nucor's year-on-year comparisons for the fourth quarter look strong, whatever happened last year may as well have happened 100 years ago for all it matters to current market conditions. So, 25% revenue growth and 120% earnings before interest, taxes, depreciation and amortization (EBTIDA) growth is all well and good, but largely irrelevant to investors. (For related reading on EBITDA, see EBITDA: Challenging The Calculation.)

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http://stocks.investopedia.com/stock-analysis/2012/Nucors-Rally-Leaves-Little-On-The-Table-NUE-STLD-MT-AKS0130.aspx

Investopedia: Riverbed Falls Out Of Bed

2012-01-30T11:50:00.000-05:00

Outside of companies with big exposure to carrier spending, this has been a fairly upbeat quarter for tech hardware companies. Riverbed Technologies (Nasdaq:RVBD) wrecked that idyll to some extent on Thursday, warning investors that expectations for 2012 were too high. Although investors are booting this stock out of their portfolios on the day after earnings, a closer look at what's going on suggests a possible opportunity may be developing for patient investors.

Good Fourth Quarter Earnings, but...
Riverbed posted pretty solid results for the fiscal fourth quarter. Revenue rose 23% from last year and 7% from the prior quarter, leading the company to beat the average estimate by a few million dollars. Product revenue was up 6% and ex-government revenue from enterprise customers was up strongly at 23%. Also encouraging, Riverbed's recovery in Europe continues, though the U.S. growth was not so impressive.

Seeking Alpha: Amylin Gets Its Yes: Now For The Hard Work

2012-01-27T15:28:00.000-05:00

Amylin Pharmaceutical (AMLN) investors got some long-awaited good news Friday afternoon, as the FDA finally granted approval to market Bydureon, an extended-release of Amylin's one-time blockbuster Byetta. Obviously this is a positive development for the company, but now the hard work begins. Amylin's market cap already assumed approval of this drug and now the company has to convince skeptical analysts and investors that it can steer itself to greatness (or buyout) as largely a one-product company.

Don't Tell Me About The Labor Pains, Just Show Me The Baby
Amylin has been working on getting approval of Bydureon since May of 2009, when the company first submitted a New Drug Application (NDA) to the FDA. The first FDA rejection came about a year later when the FDA wanted data on labeling and a risk mitigation strategy. The company resubmitted its response to these fairly routine questions only to get a second rejection in October of 2010 and a request from the FDA for a new trial to assess potential cardiac risk.

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Amylin Gets Its Yes; Now For The Hard Work

FinancialEdge: Blue Collar Can Mean Big Money

2012-01-27T15:17:00.000-05:00

One of the curious outcomes of this recent recession and slow recovery may be a rethinking of how Americans view their careers and go about training for them. While attending and graduating from a four-year college has long been billed as the golden ticket to a quality life, there are signs that this may be changing. Although some sort of post-high school training and skill development is very important, it may be the case that blue collar skilled trades should get a second look.

The College Problem
One of the major issues in education today is the growing cost of a four-year college education. Numerous articles and studies have explored how the cost of attending college has not only outstripped inflation, but lapped it many times over in recent decades. This is putting education further and further out of reach for more and more people without resorting to loans, and increasing the student loan debt burden to an almost unsustainable degree.

The full column is here:
http://financialedge.investopedia.com/financial-edge/0112/Blue-Collar-Can-Mean-Green.aspx#axzz1kVInBUch

Seeking Alpha: Fourth Quarter Results Suggest The Street Still Underestimates 3M

2012-01-27T15:14:00.001-05:00

Shares of the multi-armed conglomerate 3M (MMM) are up about 10% since I last discussed the company, but the story hasn't really changed all that much. Trouble in a few businesses masks an otherwise relatively solid story and Wall Street sell-analysts can barely muster tepid enthusiasm for the shares. Europe and assorted technology markets represent a risk to 2012 results, but fourth quarter results suggest that most of the risk here is to the upside.

3M Steps Over A Low Bar In Q4
To be fair, 3M's outperformance in the fourth quarter was against pretty weak expectations. Still, nearly 6% in constant currency revenue growth is nothing to sneeze at. Organic revenue growth of 3.3% (about one-third coming from volume) was not so spectacular, but did represent a sequential improvement - suggesting that 3M's performance may have bottomed in December.

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Fourth Quarter Results Suggest The Street Still Underestimates 3M

Seeking Alpha: Microsemi's Frustrating But Ultimately Undervalued Story

2012-01-27T13:41:00.000-05:00

Small-cap semiconductor company Microsemi (MSCC) and I go back a ways. I've owned this stock at various points over the last 16 years and have always managed to make money doing so. I suspect a fair bit of those profits have come from appreciating the company's qualities and prospects at times when the Street was entranced by sexier growth names and then selling as the optimism built.

It's a little hard to really feel good about the December results that Microsemi just posted. Sure, there are good reasons that results were just in-line and that guidance was a little soft, but I hold these shares for performance and not to hear good reasons for underperformance. So, what's a Microsemi investor to do?

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Microsemi's Frustrating But Ultimately Undervalued Story

Investopedia: Nokia Still Has Miles To Go

2012-01-27T13:21:00.000-05:00

It says something about a company (and its stock) when the market is apparently willing to hand out plaudits on the basis of "things were less terrible than we thought." It's hard to say that Nokia (NYSE:NOK) is really on the way back, but maybe this fading mobile phone leader has at least found the path to take.

Stepping Over a Low Bar

Sell-side analysts didn't expect a lot from Nokia, but the company at least delivered that much. Revenue was up 11% sequentially for the fourth quarter, though down 21%. Both the "device" (that is, phones) and networks business saw basically the same 11% sequential growth (networks was a little stronger), but the year-on-year drop for devices was still pretty steep, down almost 30%. (For related reading, see Research In Motion Sliding Toward The Cliff.)

Investopedia: Silicon Labs Has A Great Growth Story, But Has Already Run

2012-01-27T13:20:00.000-05:00

Semiconductors are on the way back in 2012, but timing is still a major factor in making these investments work. Silicon Labs (Nasdaq:SLAB) is a frustrating case in that regard. While few (if any) chip stocks have a better near-term organic growth story, the stock has already been on a solid run since the fall of 2011. While further multiple expansion is possible, recent performance may be tough to replicate.

A Stronger Close to the Year than Most
While most chip stocks are reporting a washout December quarter, Silicon Labs had the impertinence of reporting actual growth. Revenue rose 6% from the third quarter, as relatively strong results in video tuners and touch controllers drove results above even management's flat guidance.

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http://stocks.investopedia.com/stock-analysis/2012/Silicon-Labs-Has-A-Great-Growth-Story-But-Has-Already-Run-SLAB-ATML-CY-TXN0127.aspx

Investopedia: Stanley Black & Decker May Be Surprisingly Cheap

2012-01-27T13:18:00.000-05:00

Every once in a while it's a good idea for investors to broaden their horizons and re-examine some ideas of the past. While I have been spending a fair bit of time on industrial supply companies and overseas toolmakers like Atlas Copco and Techtronic, it may be the case that there's an interesting stock here in the States. More to the point, Stanley Black & Decker (NYSE:SWK) has some challenges and real risks, but looks surprisingly cheap after its latest earnings report.

The Consummate Noisy Quarter

Unfortunately, assessing Stanley's quarter takes a fair bit of work for all of the moving parts. The company reported revenue growth of almost 16%, with 6% organic growth from a 5% volume increase and a 1% price increase. This was a pretty solid result. Breaking it down, the Construction/DIY business saw 4% reported growth (or 8% organic growth after excluding Pfister), Industrial was up more than 11% (7% organic), while Security was up almost 47% as reported, but flat on an organic basis.

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http://stocks.investopedia.com/stock-analysis/2012/Stanley-Black--Decker-May-Be-Surprisingly-Cheap-SWK-SNA-EMR-IR0127.aspx

Seeking Alpha: Covidien Plays To Its Strengths And Looks Undervalued

2012-01-27T08:57:00.002-05:00

Sometimes healthcare is like real estate and success is all about location. For most of the past decade, Covidien's (COV) strengths were not seen as especially valuable - investors wanted the hot growth stories in stents, ICDs, and orthopedic implants, not a company that makes staplers and vessel sealers. Now, though, Covidien is the med-tech name that is showing good growth and the former winners are struggling to follow.

A Solid Start To The Fiscal Year
Covidien reported organic revenue growth of nearly 5% for the fiscal year; not only beating the analysts' guesses, but showing some acceleration from recent trends. The company reported 6% top-line growth from devices, about 4% growth in the pharmaceuticals division, and basically no growth in supplies. Relative to expectations, devices and drugs were surprisingly strong, while supplies were weak.

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Covidien Plays To Its Strengths And Still Looks Undervalued

Seeking Alpha: Slower Growth May Be A Good Thing For First Cash Financial

2012-01-27T06:07:00.000-05:00

It was only a few weeks ago when I wrote that investors ought to consider taking advantage of a pullback in pawn store operator First Cash Financial (NASDAQ: FCFS). Since then, the stock has bounced back to the tune of 15%. Now with fourth quarter earnings in hand, it's a good time to review the thesis and what's going on with this Latin American consumer play.

A Fourth Quarter More Or Less As Expected
First Cash Financial gave analysts revised guidance closely before its official earnings release and so the reported earnings weren't too terribly surprising. Revenue was a little disappointing relative to original expectations, though 15% reported growth and 20% constant currency growth doesn't sound so bad. Unusually for FCFS, revenue growth in the U.S. was stronger than in Mexico. More on this in a minute.

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Slower Growth May Be A Good Thing For First Cash Financial

Seeking Alpha: For St. Jude Bulls, It's A Question Of Faith

2012-01-26T15:53:00.000-05:00

In the realm of healthcare stocks too cheap to ignore, there are a lot of different stories to suit individual investor tastes.

Covidien (COV) is the under-appreciated and overlooked story, Stryker (SYK) is the quality story, and Medtronic (MDT) is the "yeah, growth has slowed, but not that much" story. What about St. Jude Medical (STJ), then? St. Jude is the rebound and pipeline story, a story that arguably deliver better growth than the Street presently expects.

A So-So End To The Year, As Expected
St. Jude's growth in fourth quarter came in on the lower range with the likes of Johnson & Johnson (JNJ) as opposed to stronger stories like Covidien and Stryker. Reported sales rose 4%, but organic growth was more on the order of 1% for the December quarter.

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For St. Jude Bulls, It's A Question Of Faith

Investopedia: "Figuring Out" Apple Feels Like A Sisyphean Task

2012-01-26T13:12:00.002-05:00

Spare a moment of pity for the Apple (Nasdaq:AAPL) bears and shorts, as they have another difficult day ahead of trying to get over their cognitive dissonance. Simply put, this company remains a remarkable force in consumer technology, and seems to have an uncanny ability to create its own markets. The Gordian knot for Apple investors, then, is trying to make their peace with a valuation that suggests Apple may just be worth a truly breathtaking amount of money.

A Great Start to the Year
Apple certainly had a good Christmas. Revenue in the fiscal first quarter jumped 73% from last year and 64% from the prior quarter, and did some very bad things to the prior analyst guesses. Revenue was largely strong across the board - PC sales were up 22%, iPhone sales were up 133% and iPad sales were up 99%, while iPod sales declined 26% year-on-year.

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http://stocks.investopedia.com/stock-analysis/2012/Figuring-Out-Apple-Feels-Like-A-Sisyphean-Task-AAPL-HPQ-DELL-RIMM0126.aspx

Investopedia: EMC's Steady Growth Still Undervalued

2012-01-26T13:11:00.000-05:00

EMC (NYSE:EMC) isn't a hyper-growth story like its majority-owned subsidiary VMware (NYSE:VMW) or emerging storage name Fusion-IO (NYSE:FIO), but it's a dependable leader in a major market. Bears may fret about the magnitude of the IT spending slowdown in 2012 and the potential for management to misspend its growing cash balance, but this stands out as a quality tech holding all the same.

A Good Close to the Year
EMC doesn't often beat analysts' estimates by a big margin, but the company is a steady performer all the same. As the info storage business was quite strong, fourth quarter revenues rose 14% on an annual comparison and more than 11% sequentially. Mid-range systems grew about 24% this quarter, while the high-range line grew about 11%. Isilon is still a relatively small contributor to EMC, but this acquisition is chugging along at a 100% growth rate right now.

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http://stocks.investopedia.com/stock-analysis/2012/EMCs-Steady-Growth-Still-Undervalued-EMC-IBM-NTAP-HPQ0126.aspx

Investopedia: Coal's Weak, So Buy Peabody

2012-01-26T11:33:00.000-05:00

Yes, that title seems counter-intuitive. Why buy a major U.S.-based producer of coal at a time when thermal coal prices are weak and the outlook for metallurgical coal is uncertain? Well, the reality is that it's only when coal markets look terrible, that Peabody Energy (NYSE:BTU) ever looks relatively cheap. While this leading energy company has more work to do in Australia than expected, today's prices represent a relatively good long-term entry point for patient and risk-tolerant investors.

Blame it on the Wombats

Peabody's fourth quarter was not especially strong, and it's mostly the fault of the acquired operations of Ma carthur Coal in Australia. Honestly, few analysts or institutional investors really care about the revenue of a coal company like Peabody, but it was up 26% from last year, with an 8% increase in tons sold and better than 11% growth from the U.S.

Seeking Alpha: Can Steel Dynamics Keep Up Its Momentum

2012-01-25T19:49:00.000-05:00

Although the last couple of quarters have been difficult ones for mini-mill operators Steel Dynamics (STLD) and Nucor (NUE), investors have actually been pretty enthusiastic on the stocks. Whether it's expectations of strength in markets like automobiles, energy, and construction or just a response to cyclical low valuations, Steel Dynamics is up more than 60% since early October lows. That's a big gain for non-owners to miss, but the question is how much is yet left to go.

A Surprisingly Strong End To The Year
Steel Dynamics warned the Street that numbers were too high back in December, but the company managed to do better than those revised expectations. Revenue fell 9% from the third quarter and operating income was cut by almost one-quarter, but the earnings per share came in at $0.14 - two cents above the high end of management's guidance range and three to four cents higher than most analysts'.

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Can Steel Dynamics Keep Up Its Momentum?

FinancialEdge: How To Be A Millionaire

2012-01-25T15:29:00.003-05:00

There's no real practical reason to ask "who wants to be a millionaire?" because the only people who won't put their hand up are religious types who've taken vows of poverty and those who are already multi-millionaires. Unfortunately, there's a big gulf between those who want it and those who do the things to make it happen. (For related reading, see 5 Easy Steps To Becoming A Millionaire.)

Based on recent statistics on U.S. household income, millionaire-dom is not something that's going to happen for most people, even with the dubious benefits of inflation. A household earning the median level of income (approximately 50K) and saving an impressive 20% of that would need almost 100 years to save $1 million (excluding taxes and investment gains). It's pretty clear, then, that a would-be millionaire has to think outside the boundaries of "median" experience.

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http://financialedge.investopedia.com/financial-edge/0112/How-To-Be-A-Millionaire.aspx#axzz1kVInBUch

Seeking Alpha: Stryker Preparing For A Hard Slog In 2012

2012-01-25T14:37:00.002-05:00

Diversified med-tech company Stryker (SYK) gave us all a preview of earnings two weeks ago that painted a fairly uninspiring picture in many respects. With the details of the full earnings release now in hand, it's clear that the company has some significant challenges ahead in 2012. Given today's valuation and management's history of navigating past challenges, investors would do well to consider these shares for their portfolios.

Results Broadly As Expected
Stryker reported that revenue rose 11% in the fourth quarter, or a little less than 4% on an organic basis. All of the growth came from MedSurg (up 11%) and Neuro/Spine (up over 46%), as the orthopedics business was up 1% as reported, but down 2% organically.

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Stryker Preparing For A Hard Slog In 2012

Investopedia: Baker Hughes Not Helping The Sentiment On North American Energy

2012-01-25T14:34:00.000-05:00

Given how much share of the North American energy services industry is controlled by the Big Four, investors cannot just ignore the trends that come out of the earnings releases. With Schlumberger (NYSE:SLB), Halliburton (NYSE:HAL) and Baker Hughes (NYSE:BHI) having reported in the past few days, it's pretty clear that business conditions in North America are not great. The question, though, is whether this sector will once again start trading on the strength of oil (versus the weakness in gas) and whether a company like Baker Hughes should trade this far below historical forward valuations.

Investopedia: Packaging Corp Thinks Outside The Box

2012-01-25T14:33:00.000-05:00

Time after time, investors who do a little extra work to identify those companies in commodity industries that do things a little better, see long-term rewards. It was true years ago in steel, when Nucor (NYSE:NUE) pioneered a new model, and it's true, at least to some extent, in containerboard (boxes) with Packaging Corp (NYSE:PKG).

A Good End to the Year, Relatively Speaking

At first glance, Packaging Corp's earnings aren't going to look all that great. Revenue rose just 4% on a 0.2% increase in containerboard production and 7% increase in box shipments. Given that industry prices were not very strong in the second half of the year, that was a pretty good result for Packaging Corp and a little better than the Street was expecting.

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Investopedia: Is VMware's Road Starting To Turn Uphill?

2012-01-25T10:37:00.000-05:00

There's that unpredictable moment in a growth tech stock's life where investors and analysts go from assuming that the trees will grow to the sky to assuming that the lumberjacks are already on site. That may not yet be the case for VMware (NYSE:VMW), but it definitely seems that sell-side analysts are no longer racing to top each others' growth estimates and that there's an increasing concern about the underlying growth of the market.

A Mostly Solid Close to the Year
VMware reported that total revenue grew 27% this quarter and almost 13% from the September quarter. License revenue rose 22%, but this basically just met the expectations. One of the good news/bad news situations is that VMware is seeing an increasing amount of service and maintenance revenue. This a lucrative stream of revenue for any company, but investors don't tend to prize that much at companies like CA (Nasdaq:CA) or Microsoft (Nasdaq:MSFT).

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http://stocks.investopedia.com/stock-analysis/2012/Is-VMwares-Road-Starting-To-Turn-Uphill-VMW-MSFT-IBM-BMC0125.aspx