Post Market Update
Southpoint Qualified Fund and Southpoint Qualified Offshore Fund returned 2.5% net for the first quarter, compared to the S&P 500's 6.2% return and the Russell 2000's 12.7% gain. During the first quarter, Southpoint's funds averaged 133% long and 70% short. Q1 2021 hedge fund letters, conferences and more The fund's long positions added 13% gross Read More
* US: Dow: 13345.90 (0.02%), S&P 500: 1433.82 (0.04%), NASDAQ: 3016.96 (0.38%)
* Europe: CAC: 3483.25 (-0.61%), DAX: 7328.05 (-0.72%), FTSE: 5882.91 (-0.23%).
* Asia-Pacific: Australia: 4541.00 (-0.66%), China: 2132.76 (0.21%), Hong Kong: 21697.55 (0.67%), India: 5717.15 (0.58%), Japan: 9010.71 (0.09%).
* Metals: Gold: 1729.10 (0.30%), Silver: 32.44 (1.08%), Copper: 3.62 (-0.47%)
* Energy: Crude Oil: 89.11 (-1.47%), Natural Gas: 3.44 (-4.87%)
* Commodities: Corn: 7.61 (-0.03%), Soya Bean: 15.49 (0.83%), Wheat: 8.78 (0.66%)
* Currency: Euro (€) / US Dollar ($) (EURUSD): 1.3063 (0.02%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.6013 (-0.01%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 79.9700 (0.03%)
* 10 year US Treasury: 1.813% (0.050)
Market and Economy News Update
U.S. markets end flat: U.S. markets rebounded from lows in the final hour of trading to end largely unchanged on Monday, helped by a smart recovery from Apple Inc. (NASDAQ:AAPL). The Dow Jones Industrial Average (INDEXDJX:.DJI) added 2.38 points, or 0.02 percent, to close at 13,345.89. The S&P 500 (INDEXSP:.INX) eked out a gain of 0.62 points, or 0.04 percent, to end at 1,433.81, while the NASDAQComposite (INDEXNASDAQ:.IXIC) rose 11.34 points, or 0.38 percent, to finish at 3,016.96.
Oil prices fall: Crude prices declined on Monday amid investor concerns about a slowdown in the global economy. Industrial equipment giant Caterpillar Inc. (NYSE:CAT) said on Monday the global economy is slowing faster than it had expected. Data from Japan showed exports tumbled in September. Crude oil for November delivery lost 1.5 percent, to settle at $89.11 a barrel on the New York Mercantile Exchange. Brent oil for December settlement slid 0.4 percent to $109.69 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
* Yahoo! Inc. (NASDAQ:YHOO) reported third-quarter earnings excluding some items of 35 cents a share that easily beat the average analysts’ estimate of 26 cents a share. Net revenue stood at $1.09 billion, up from $1.07 billion in the year ago period, also topping estimates of $1.08 billion.
* Texas Instruments Incorporated (NASDAQ:TXN) posted third quarter profit of $784 million, or 67 cents per share, down from $601 million, or 51 cents per share, in the same period last year. Revenue fell to $3.39 billion from $3.47 billion, a year earlier. The chip maker forecast fourth-quarter profit that fell short of analysts’ estimates.
* Western Digital Corp. (NASDAQ:WDC) said first quarter profit more than doubled to $519 million, or $2.06 a share, from $239 million, or $1.01 a share in the year-earlier period. Excluding certain items, the company reported earnings of $2.36 per share, topping estimates of $2.29 per share. Revenue gained 50 percent to $4.04 billion.
* Zions Bancorporation (NASDAQ:ZION) said third-quarter profit fell 4.5 percent to $62.3 million or 34 cents per share, from $65.2 million or 35 cents per share in the year-ago period. Excluding one time items, earnings came in at 37 cents a share, beating estimates of 30 cents a share.
* Netflix, Inc. (NASDAQ:NFLX) jumped 4.5 percent after a new study showed 20 percent of online consumers consider online video as a replacement for pay TV.
* FedEx Corporation (NYSE:FDX) forecast a 13 percent annual increase in holiday shipping volume and said it will hire 20,000 seasonal employees during the holiday season.
* Auto parts maker Cascade Corporation (NYSE:CASC) surged 18 percent after Toyota Motor Corporation (ADR) (NYSE:TM) (TYO:7203) agreed to buy the company for $65 a share, or about $759 million in cash.
* Trucking company Swift Transportation Co (NYSE:SWFT) reported third quarter earnings and revenue that trailed Street estimates.
* AMC Networks Inc (NASDAQ:AMCX) and Dish Network Corp. (NASDAQ:DISH), both closed significantly higher after reaching a settlement over a four-year old lawsuit.
* OpenTable Inc (NASDAQ:OPEN), the largest U.S. online restaurant-reservation service, moved 6.4 percent higher following a Reuters report that Yahoo! Inc. (NASDAQ:YHOO) might be interested in acquiring the company.
* Eli Lilly & Co. (NYSE:LLY) said its investigational once-weekly diabetes drug dulaglutide showed positive results in lowering blood sugar levels in late-stage clinical trials.
* Canadian fertilizer company Agrium Inc. (USA) (NYSE:AGU) (TSE:AGU) climbed 3.4 percent after completing a 900 million Canadian dollars ($908 million) share buyback, and outlining plans to double its annual dividend.
* Tax preparation company H&R Block, Inc. (NYSE:HRB) ended 3.7 percent higher after analysts at BTIG Research began coverage of the stock with a “buy” rating, saying is not only an “attractive value play” but an “attractive takeover target.”
* Pet pharmacy Petmed Express Inc (NASDAQ:PETS) said second quarter profit rose 2.6 percent to $4 million, or 20 cents a share, from $3.93 million, or 19 cents a share, in the year-ago period. Sales for the quarter came in at $58.1 million. Analysts had forecast earnings of 17 cents on revenue of $57 million.
* Monster Beverage Corp (NASDAQ:MNST) plunged 14 percent amid reports that five people may have died recently drinking the company’s caffeine-laden energy drink.
* Auto parts retailer Advanced Auto Parts, Inc. (NYSE:AAP) fell 3.3 percent after percent the company issued a third-quarter warning and cut its full year earnings outlook. The company forecast third quarter per-share earnings of $1.21 on revenue of $1.46 billion, below estimates for earnings of $1.35 on $1.47 billion in revenue.
* Power company Dominion Resources, Inc. (NYSE:D) said it is planning to permanently shut down the Kewaunee nuclear power plant in Wisconsin after failing to find a buyer.
* Supernus Pharmaceuticals Inc (NASDAQ:SUPN) said it has received final approval from the U.S. Food and Drug Administration for its experimental epilepsy drug Oxtellar XR.
* Overseas Shipholding Group Inc. (NYSE:OSG) tumbled 62 percent after the largest U.S. tanker company said it was evaluating all its options, including filing for bankruptcy.
* Heating and cooling equipment maker Lennox International Inc. (NYSE:LII) closed 2.4 percent higher after reporting better than expected third quarter adjusted earnings and raising its full-year earnings estimate.
* Medical device maker Medtronic, Inc. (NYSE:MDT) said initial results of an advanced study showed its transcatheter aortic valve implantation system, CoreValve, improved patients’ one-year survival rate, while its renal denervation system, Symplicity, lowered patients’ blood pressure after two years.
* Terex Corporation (NYSE:TEX) said Chief Financial Officer Phil Widman will retire next year, and the diversified manufacturer has begun a search for his replacement.
Hedge Fund News Update
* Activist investor Carl Icahn has urged Oshkosh Corporation (NYSE:OSK) shareholders to sell their shares to him or vote for his slate of directors in his
proxy fight to replace the company’s existing board. Ichan, with a 9.5 percent stake in the heavy-duty truck maker, is the company’s largest shareholder.
* Thomas Steyer, the billionaire founder of San Francisco-based hedge fund Farallon Capital Management LLC is planning to step down by the end of the year, according to a Reuters report.
* Hedge funds managers reduced their bullish commodity bets to the lowest since July, data from the U.S. Commodities and Futures Trading Commission showed. Money managers cut their net-long positions across 18 U.S. futures and options by 4.4 percent to 1.18 million contracts in the week ended October 16, the lowest level since July 24.
* According to a survey by Macro Risk Advisors, the possibility of big tax hikes and deep spending cuts top the list of concerns among hedge fund managers, CNBC reported today.
* Houston-based hedge fund Copperwood Energy Fund LP has raised $513 million from investors since July 2, according to a regulatory filing.
Brokerage Upgrades and Downgrades on Monday, October 22, 2012
* Amgen, Inc. (NASDAQ:AMGN) was lifted to “buy” from “hold” by analysts at Deutsche Bank.
* BEAM Inc (NASDAQ:BEAM) was upgraded to “overweight” from “equal weight” by analysts at Morgan Stanley.
* Bonanza Creek Energy Inc (NYSE:BCEI) was raised to a “focus stock” rating from an “outperform” rating by analysts at Howard Weil with a target price of $40.
* Carmike Cinemas, Inc. (NASDAQ:CKEC) was lifted to “above average” from “average” by analysts at Caris & Co.
* Cirrus Logic, Inc. (NASDAQ:CRUS) was upgraded to “strong buy” from “buy” by analysts at Feltl & Co.
* Cablevision Systems Corporation (NYSE:CVC) was raised to “buy” from “hold” by analysts at Canaccord Genuity with a target price of $23.
* City National Corp (NYSE:CYN) was lifted to “buy” from “neutral” by analysts at B. Riley
* Eaton Corporation (NYSE:ETN) was upgraded to “buy” from “neutral” by analysts at MKM Partners.
* International Flavors & Fragrances Inc (NYSE:IFF) was raised to “buy” from “hold” by analysts at Stifel Nicolaus.
* Kinder Morgan Energy Partners LP (NYSE:KMP) was lifted to “buy” from “hold” by analysts at Argus with a target price of $93.
* Meritor Inc (NYSE:MTOR) was upgraded to “overweight” from “equal weight” by analysts at Barclays Capital.
* SPS Commerce, Inc. (NASDAQ:SPSC) was raised to “buy” from “hold” by analysts at Canaccord Genuity with a target price of $45.
* Texas Industries, Inc. (NYSE:TXI) was lifted to “neutral” from “underperform” by analysts at Sterne Agee.
* Wright Express Corp (NYSE:WXS) was upgraded to “neutral” from “underweight” by analysts at JPMorgan Chase.
* Arcos Dorados Holding Inc (NYSE:ARCO) was downgraded to “equal weight” from “overweight” by analysts at Morgan Stanley.
* Cliffs Natural Resources Inc (NYSE:CLF) was lowered to “hold” from “buy” by analysts at Deutsche Bank.
* Canadian Pacific Railway Limited (USA) (NYSE:CP) was cut to “market perform” from “outperform” by analysts at BMO Capital Markets.
* DENTSPLY International Inc. (NASDAQ:XRAY) was downgraded to “sell” from “neutral” by analysts at UBS AG.
* DDR Corp (NYSE:DDR) was lowered by analysts at UBS AG from a “buy” rating to a “neutral” rating.
* El Paso Pipeline Partners, L.P. (NYSE:EPB) was cut to “market perform” from “outperform” by analysts at Wells Fargo & Co.
* Equity Residential (NYSE:EQR) was downgraded to “sell” from “neutral” by analysts at Goldman Sachs.
* Edwards Lifesciences Corp (NYSE:EW) was lowered by analysts at Citigroup from a “buy” rating to a “neutral” rating.
* Manitowoc Company, Inc. (NYSE:MTW) was cut to “neutral” from “buy” by analysts at Goldman Sachs.
* Owens & Minor, Inc. (NYSE:OMI) was downgraded to “sell” from “neutral” by analysts at UBS AG.
* Public Service Enterprise Group Inc. (NYSE:PEG) was lowered by analysts at Credit Suisse from a “neutral” rating to an “underperform” rating.
* SL Green Realty Corp (NYSE:SLG) was cut to “hold” from “buy” by analysts at ISI Group.
* SanDisk Corporation (NASDAQ:SNDK) was downgraded to “sector perform” from “outperform” by analysts at RBC Capital Markets.
* Talisman Energy Inc. (USA) (NYSE:TLM) was lowered by analysts at Canaccord Genuity from a “buy” rating to a “hold” rating with a target price of $14.75.
* Western Alliance Bancorporation (NYSE:WAL) was cut to “neutral” from “outperform” by analysts at Macquarie.
Earnings Calendar for Tuesday, October 23, 2012
Before Market Open:
* Airgas, Inc. (NYSE:ARG)
* E. I. du Pont de Nemours and Co (NYSE:DD)
* Harley-Davidson, Inc. (NYSE:HOG)
* 3M Co (NYSE:MMM)
* MeadWestvaco Corp. (NYSE:MWV)
* Molex Incorporated (NASDAQ:MOLX)
* Ryder System, Inc. (NYSE:R)
* Reynolds American, Inc. (NYSE:RAI)
* Regions Financial Corporation (NYSE:RF)
* Sigma-Aldrich Corporation (NASDAQ:SIAL)
* United Parcel Service, Inc. (NYSE:UPS)
* United Technologies Corporation (NYSE:UTX)
* Waters Corporation (NYSE:WAT)
* Xerox Corporation (NYSE:XRX)
After Market Close:
* Altera Corporation (NASDAQ:ALTR)
* C. R. Bard, Inc. (NYSE:BCR)
* Broadcom Corporation (NASDAQ:BRCM)
* C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW)
* FMC Technologies, Inc. (NYSE:FTI)
* Juniper Networks, Inc. (NYSE:JNPR)
* Nabors Industries Ltd. (NYSE:NBR)
* Netflix, Inc. (NASDAQ:NFLX)
* Newfield Exploration Co. (NYSE:NFX)
* Norfolk Southern Corp. (NYSE:NSC)
* Total System Services, Inc. (NYSE:TSS)