Post Market Update
Qualivian Investment Partners Up 30% YTD; Long ORLY Thesis
Qualivian Investment Partners commentary for the second quarter ended July 30, 2020. Q2 2020 hedge fund letters, conferences and more “Short-term investors will accept a 20% gain because they didn’t spend the time to develop the conviction and foresight to see the next 500%.” - Ian Cassell Executive Summary Readers of investment letters fall into Read More
• US: Dow: 12571.00 (-1.45%), S&P 500: 1355.49 (-1.39%), NASDAQ: 2846.81 (-1.29%)
• Europe: CAC: 3400.02 (-0.90%), DAX: 7101.92 (-0.95%), FTSE: 5722.01 (-1.12%).
• Asia-Pacific: Australia: 4388.40 (0.20%), China: 2055.42 (0.37%), Hong Kong: 21441.99 (1.18%), India: 5666.95 (-0.29%), Japan: 8664.73 (0.04%).
• Metals: Gold: 1730.10 (0.31%), Silver: 32.88 (1.21%), Copper: 3.45 (-0.50%)
• Energy: Crude Oil: 86.32 (1.10%), Natural Gas: 3.76 (0.56%)
• Commodities: Corn: 7.29 (0.41%), Soya Bean: 14.19 (0.78%), Wheat: 8.64 (-0.20%)
• Currency: Euro (€) / US Dollar ($) (EURUSD): 1.2735 (0.24%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.5842 (-0.18%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 80.2400 (1.08%)
• 10 year US Treasury: 1.588% (-0.007)
Market and Economy News Update
U.S. markets end lower: U.S. markets closed near the lows of the day on Wednesday as geopolitical tension in the Middle East added to worries about efforts to avert more than $600 billion in automatic spending cuts and tax hikes slated to start in January. On the economic front, retail sales dropped in October, while business inventories increased to a record $1.61 trillion in September The Dow Jones Industrial Average (INDEXDJX:.DJI) slid 185.23 points, or 1.45 percent, to end at 12,570.95. The S&P 500 (INDEXSP:.INX) dropped 19.04 points, or 1.39 percent, to close at 1,355.49. The NASDAQComposite (INDEXNASDAQ:.IXIC) fell 37.08 points, or 1.29 percent, to finish at 2,846.81.
Oil prices jump: Oil prices gained on Wednesday as Israel launched a major offensive against Palestinian militants in Gaza, reinforcing investor concerns about the potential for greater supply disruptions in the Middle East this year. Crude oil for December delivery added 1.1 percent, to settle at $86.32 a barrel on the New York Mercantile Exchange. Brent oil for December settlement surged 1.5 percent to $109.85 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
• Facebook Inc (NASDAQ:FB) soared 12.6 percent even as about 800 million shares, the largest since the company’s initial public offering, became eligible for trading.
• NetApp Inc. (NASDAQ:NTAP) reported second-quarter earnings excluding one-time items of 51 cents a share, 3 cents above the average analysts’ estimate. Revenue came in at $1.54 billion, in line with Street expectations.
• Texas Instruments Incorporated (NASDAQ:TXN) will slash 1,700 jobs worldwide as part of a plan to reduce costs.
• PetSmart, Inc. (NASDAQ:PETM) reported third quarter earnings of 75 cents per share, 12 cents ahead of expectations, while revenues rose 9 percent to $1.63 billion from $1.50 billion last year.
• Teen retailer Abercrombie & Fitch Co. (NYSE:ANF) surged 34 percent after posting a higher quarterly profit, thanks to improved demand in international markets, and raising its outlook for the year.
• Toyota Motor Corporation (ADR) (NYSE:TM) (TYO:7203) fell 1.9 percent after the Japanese automaker said it would recall 2.77 million vehicles worldwide for steering and water pump problems.
• Starbucks Corporation (NASDAQ:SBUX) has agreed to acquire Atlanta-based tea seller Teavana Holdings, Inc. (NYSE:TEA) for $620 million in cash.
• Advanced Micro Devices, Inc. (NYSE:AMD) fell 7.7 percent despite denying reports that it is looking to sell the company or any of its assets. Reuters had earlier reported that the chip maker had hired J.P. Morgan Chase & Co. to explore options, including a sale of the company or of its patent portfolio.
• Groupon Inc (NASDAQ:GRPN) has named Kal Raman as its new chief operating officer.
• Office supply chain Staples, Inc. (NASDAQ:SPLS) reported a slightly better than expected quarterly profit, though revenue trailed estimates, weighed down by weak sales in Europe and Australia. The company maintained its fiscal 2013 earnings outlook.
• Aerospace and defense supplier Woodward Inc (NASDAQ:WWD) soared 7.7 percent after reporting fourth quarter earnings that beat Street estimates.
• Private equity firm Carlyle Group LP (NASDAQ:CG) and two other investors will pay $210 million for a stake in Tanzania-based agricultural company Export Trading Group.
• Mosaic Co (NYSE:MOS), the largest U.S. fertilizer producer, closed down 3.3 percent after lowering its guidance for fiscal second-quarter potash and phosphates sales.
• Buyout firm KKR & Co. L.P. (NYSE:KKR) is planning to develop a housing community in Williston, North Dakota to meet residential demand fueled by the state’s booming oil industry.
• Composite materials manufacturer Hexcel Corporation (NYSE:HXL) jumped 3.5 percent following reports in UK’s Daily Mail that it could be a takeover target.
• Canada’s IAMGOLD Corporation (USA) (NYSE:IAG) (TSE:IMG) tumbled 19 percent after the gold miner reported weaker-than-expected quarterly earnings and cutting its production target for 2013.
• Security products maker Tyco International Ltd. (NYSE:TYC) fell 2.6 percent after reporting lower than expected fourth quarter earnings. Full-year sales and earnings outlook also trailed Wall Street expectations.
• Manchester United PLC (NYSE:MANU), the world’s most popular soccer club, reported fiscal first quarter profit of 20.5 million pounds ($32.5 million), or 13 pence a share, compared with a loss of 5 million pounds, or 3 pence a share, a year earlier. The most-recent quarter included a 26.5 million pound ($42 million) tax credit. Revenue increased 3.4 percent to 76.3 million pounds ($121.2 million). Analysts had projected a loss of $2 a share on revenue of $76 million.
Hedge Fund News Update
• Charles Coleman’s Tiger Global Management held 11.7 million shares of Facebook Inc. (NASDAQ:FB) as of September 30, up from 2 million shares on June 30, according to a regulatory filing.
• London-based Lansdowne Partners LP acquired a new position in Morgan Stanley (NYSE:MS) and increased its stake in JPMorgan Chase & Co. (NYSE:JPM) during the third quarter, according to a filing with the Securities and Exchange Commission.
• Target Corporation (NYSE:TGT) fell 1.1 percent after it was revealed that Farallon Capital Management LLC sold its entire 1.69 million stake in the retailer.
• Patrick McCormack’s $2 billion fund Tiger Consumer Management acquired 280,000 share of Chipotle Mexican Grill, Inc. (NYSE:CMG) and increased his fund’s stake in Green Mountain Coffee Roasters Inc. (NASDAQ:GMCR) by 500,000 shares to 1.5 million shares, according to a 13-F filing.
• New York-based Mount Kellett Capital Management LP, co-founded by two former Goldman Sachs Group, Inc. (NYSE:GS) bankers, will close its Asia-focused hedge fund, Mount Kellett Asia Partners, according to a report in Bloomberg News.
• Bridgewater Associates LP, the world’s largest hedge fund, opened new positions in Berkshire Hathaway Inc. (NYSE:BRK.A) (NYSE: BRK.B), BCE, Inc. (NYSE:BCE), Microchip Technology Inc (NASDAQ:MCHP), Nucor Corporation (NYSE:NUE), and Rogers Communications Inc. (NYSE:RCI) (TSE:RCI.B) during the quarter.
• Hedge funds were up 0.1 percent in the first week of November compared to a decline of 1.25 percent in the S&P 500 (INDEXSP:.INX), according to the Bank of America Merrill Lynch investable hedge fund composite index.
Brokerage Upgrades and Downgrades on Wednesday, November 14, 2012
• Abercrombie & Fitch Co. (NYSE:ANF) was lifted to “buy” from “neutral” by analysts at Janney Montgomery Scott with a target price of $52.
• Credicorp Ltd. (USA) (NYSE:BAP) was upgraded to “neutral” from “underweight” by analysts at HSBC Plc.
• Cisco Systems, Inc. (NASDAQ:CSCO) was raised to an “outperform” rating from a “sector perform” rating by analysts at Pacific Crest.
• Hub Group Inc (NASDAQ:HUBG) was lifted to “outperform” from “neutral” by analysts at Robert W. Baird with a target price of $38.
• Harry Winston Diamond Corporation (USA) (NYSE:HWD) was upgraded to “outperform” from “market perform” by analysts at BMO Capital Markets.
• ICF International, Inc. (NASDAQ:ICFI) was raised to “buy” from “neutral” by analysts at SunTrust.
• Magellan Midstream Partners, L.P. (NYSE:MMP) was lifted to “hold” from “sell” by analysts at Stifel Nicolaus.
• Oasis Petroleum Inc. (NYSE:OAS) was upgraded to “buy” from “neutral” by analysts at SunTrust with a target price of $40.
• PacWest Bancorp (NASDAQ:PACW) was raised to “buy” from “hold” by analysts at Wunderlich with a target price of $29.
• Royal Caribbean Cruises Ltd. (NYSE:RCL) was lifted to “buy” from “hold” by analysts at Argus with a target price of $40.
• Response Genetics, Inc. (NASDAQ:RGDX) was upgraded to “buy” from “neutral” by analysts at Ladenburg Thalmann with a target price of $1.75.
• Stein Mart, Inc. (NASDAQ:SMRT) was raised to “buy” from “neutral” by analysts at Sidoti.
• WisdomTree Investments, Inc. (NASDAQ:WETF) was lifted to “buy” from “hold” by analysts at Gabelli.
• Weatherford International Ltd (NYSE:WFT) was upgraded to “hold” from “underperform” by analysts at Jefferies Group with a target price of $10.
• Barrick Gold Corporation (USA) (NYSE:ABX) was downgraded to “hold” from “buy” by analysts at Argus.
• Edwards Lifesciences Corp (NYSE:EW) was lowered to “sell” from “neutral” by analysts at UBS AG with a target price of $80.
• Fidelity National Information Services (NYSE:FIS) was cut to “sell” from “hold” by analysts at EVA Dimensions.
• Hi-Crush Partners LP (NYSE:HCLP) was downgraded to “neutral” from “outperform” by analysts at Robert W. Baird with a target price of $18.
• The Home Depot, Inc. (NYSE:HD) was lowered by analysts at Raymond James from an “outperform” rating to a “market perform” rating.
• J.C. Penney Company, Inc. (NYSE:JCP) was cut to “neutral” from “overweight” by analysts at JPMorgan Chase with a target price of $20.
• Northern Oil & Gas, Inc. (NYSEAMEX:NOG) was downgraded to “neutral” from “add” by analysts at Capital One with a target price of $19.
• Northern Tier Energy LP (NYSE:NTI) was lowered by analysts at Deutsche Bank from a “buy” rating to a “hold” rating.
• Potash Corp./ Saskatchewan (USA) (NYSE:POT) was cut to “hold” from “buy” by analysts at Canaccord Genuity with a target price of $43.
• Regal Entertainment Group (NYSE:RGC) was downgraded to “average” from “above average” by analysts at Caris & Co.
• Siemens AG (ADR) (NYSE:SI) was lowered by analysts at RBC Capital Markets from an “outperform” rating to a “sector perform” rating.
• Mosaic Co (NYSE:MOS) was cut to “hold” from “buy” by analysts at Canaccord Genuity with a target price of $55.