Markets ended the day yesterday essentially flat, and this morning we notice that both Asia and Europe are red. We have a few economic data points this Friday, but nothing that is an extremely important number. So with US futures down at this time and matching the movement of overseas markets, we may see the market trade lower today. We would watch commodities as corn prices continue higher and oil has trended higher in the past few sessions and it is obvious momentum is building here. After this earnings season, if one wanted to diversify away from commodities we would most certainly look for exposure to general markets via technology companies. That is where the big growth has been in recent quarters, and one would suspect that it would carry forward.
We have our first set of economic news out today, and it is as follows (data set - consensus):
Export Prices - Excl. Ag. - N/A
Import Prices - Excl. Oil - N/A
Treasury Budget - -$71.0 Billion
Looking at Asian markets we see markets are lower:
All Ordinaries - down 0.63%
Shanghai Composite - down 0.24%
Nikkei 225 - down 0.97%
NZSE 50 - up 0.16%
Seoul Composite - up 0.30%
In Europe markets are lower:
CAC 40 - down 0.80%
DAX - down 0.53%
FTSE 100 - down 0.15%
OSE - down 0.45%
Amarin Corporation (AMRN) saw its shares rise $1.57 (13.89%) to close at $12.91/share on volume of 14.7 million shares. The company announced earnings and stated that they are planning on introducing Vascepa in the 1st Quarter of 2013. Based off of what was stated by management regarding a timeline, investors could see a marketing partner brought on board before year end if the company plans on utilizing a partner's sales force. Amarin also is looking to obtain expanded protection for its patent on Vascepa. Regarding the actual results for the quarter, the company reported that their quarterly loss narrowed.
E-Trade Financial (ETFC) will be undergoing some management changes, as they announced that they were shuffling top executives. The company replaced CEO Steven Freiberg with the Chairman of their Board of Directors, Frank Petrilli taking over in the interim as the company searches for a new Chief Executive. Investors liked the move as shares rallied $0.55 (6.86%) to close at $8.57/share on volume of 18.6 million shares. The company's Chief Executive Officer position has had a revolving door recently as they have had three different people in the position over the past four years, so hopefully the company can find some stability for the position moving forward.
Shares in Windstream (WIN) were hit pretty hard yesterday as they reported second quarter results that on the surface matched analysts' expectations and the company reported a loss in the all important broadband customer count. The loss in customers purchasing broadband services was a rounding error, but it highlights an issue the company's larger rivals have been suffering and up until now had not been an issue for Windstream itself. Shares fell $0.75 (7.46%) to close at $9.30/share on volume of 35.8 million shares. The stock looks quite attractive when one looks at the dividend yield, but we would warn against looking at that as the only metric for investing in the company. There is a reason the yield is above the 10% range and it is always a level where investors need to pay extra attention to the financials and decide if the free cash flow and company's future outlook can maintain such a payout. We tend to shy away from such high dividends.
Allscripts Healthcare Solutions (MDRX) raised its earnings per share estimates for the year when they reported their quarterly earnings, which investors and analysts alike cheered. JP Morgan raised their rating from Neutral to Overweight on the company's shares and investors pushed shares higher by $1.77 (18.44%) to close at $11.37/share as 16.4 million shares were traded.
Oil Field Services
A buyout offer pushed shares of Robbins & Myers Inc. (RBN) higher on Thursday. National Oilwell Varco agreed to purchase the company for $2.54 billion in cash, which equates to a $60/share offer. Investors liked the news and the premium as they pushed shares up to just under the offer price with the close of $59.63/share. The company traded 19.6 million shares as they rose 27.41%. This tells us a few things, but most importantly that investors view the acquisition favorably and fairly priced, as well as the fact that they do not expect a third party to enter the bidding. With the shale plays maturing and fewer new plays being discovered here in the US, we would expect more deals in the area as the industry consolidates to maintain margins and become more efficient. This transaction has already been approved by both parties and is expected to close later this year.