Nadeem Moulvi's  Instablog

It was another great quarter for Dolby Laboratories (DLB). Dolby announced the financial results for the third quarter, handily beating analyst expectations. The company reported an EPS of $0.44 compared to an EPS of $0.40 a year ago.  Analysts were expecting an income of $0.31 a share on revenues of $147.2 million.  It should be noted that revenues in the quarter included approximately $22 million from prior period shipments. 

According to the Beverage Marketing Corporation, the alternative beverage segment is the fastest growing category of the beverage industry.  One company from this segment that I particularly like is Hansen Natural Corporation (Nasdaq: HANS).  It develops, markets, sells, and distributes alternative beverage category natural sodas, energy drinks (including the popular Monster energy drinks), non-carbonated iced-tea, etc. 

In an article dated June 7, 2009, based on the increasing demand for molybdenum, I predicted that Thompson Creek Metals Company (TC) would announce actual molybdenum production near the high end of its 2009 forecast. Just a day later, on June 8, Thompson Creek stated in a press release that it was making operational improvements and now expected to produce between 22 million and 26 million pounds of molybdenum, revised from a previous estimate of 20 to 24 million pounds.  Further, it reduced its 2009 cash production estimate from a previous guidance of $6.25 to $7.25 a pound to a revised estimate of $5.75 to $7 a pound.  It should be noted that the production cost estimates were reduced once before on May 7, 2009 when TC declared its 1^st quarter results.

Investing in the offshore drilling sector has been my preferred method of gaining exposure to the oil and natural gas industry and profiting from the rising commodity prices.  Offshore drilling contracts are generally long term and therefore provide the companies with some level of visibility into future earnings.  Further the business can be extremely profitable across a wide range of oil prices and, to a certain extent, is not dependant on the daily variation in the price of oil and gas.

Thompson Creek Metals Company (TC) is a Canadian mining company and is one of the largest pure molybdenum producers in the world.  Molybdenum is alloyed with steel making the steel stronger and is widely used in the iron and steel industry.  With declining steel demand owing to the global recession, the price of molybdenum fell from approximately $34 a pound to just under $8 a pound in the last quarter of last year and the during the first quarter of the current financial year.

On April 30, 2009, Dolby Laboratories (DLB) declared financial results for the second quarter 2009 reporting an EPS of $0.60.  Not surprisingly, the results were ahead of street expectations ($0.46).  Further, Dolby tightened the full year earnings outlook and now expects to earn between $1.76 and $1.91 a share.  Previously, it had forecasted an EPS in the range of $1.66 to $1.91.  At close, the stock was trading at approximately $41 a share.