Q3 2009 Earnings Call

November 10, 2009 5:00 pm ET

The long-awaited correction appears to have finally arrived. Like a yo-yo that has climbed up sharply and is now heading back down, this fall will probably not be as sharp or as deep as many pundits would suggest. I am going with a SPY target of 87.50 to 92 as the most likely bottom for this move. For those that follow my work, you may recall that this happens to be the area that I initially thought would contain the rally from March. Clearly I was too conservative. I get to my zone using several different metrics, including Fibonacci retracements as well as charting and volume-at-a-price. To be very successful in the last few months, one had to set aside one's fundamental views in my opinion and roll with the liquidity. As long as interest rates aren't rising, I do believe the pullback will be orderly and contained, but the bear is back on if we can't finance our federal debt at a low cost.

Even though my expectations are that stocks in general have about 15% downside from here (two weeks or two months - who knows), I believe that many stocks have considerably more risk. In the past few months, companies with leveraged balance sheets have roared back as the capital markets have reopened. Many companies have addressed liquidity issues by extending their debt or issuing stock, but several others have not taken advantage of what I view as a good opportunity. I am cautious on companies in general that have high levels of debt relative to their potential to generate free cash flow, especially in an environment of economic weakness or stagnation at best. With that in mind, I want to share three ideas, all of which have lots of debt relative to FCF and short-interest that has come down significantly over the past several months. None of these companies had moved to address their weak capital structures.

WTW was taken private in a 1999 leveraged buyout and then came public again on November 15, 2001 at $24 /share. Sales and earnings ramped up each year from the IPO date right through 2008. EPS for 2009 are likely to dip on a year-over-year basis from an all-time record $2.76 to about $2.62 this year.

This magic formula screen is based on a methodology advocated by Superinvestor Joel Greenblatt, author of The Little Book That Beats The Market. In a nutshell, the magic formula approach seeks out companies that are both "good" and "cheap."

It would be wonderful if the conversation shifted to what changes can realistically be made and what changes should be made to prevent a worsening crisis. Here are some ideas, along with potential investment plays.

F2Q09 Earnings Call

August 6, 2009 5:00 pm ET

My past experiences with stocks like American Capital (ACAS) and Penn West Energy Trust (PWE) have led me to focus more keenly on the sustainability of a dividend and not let the high yield blind me to problem areas. Also, following up on my last post on the market's prospects going forward, prudent, long-term investors may want to consider building a portfolio of reliable dividend plays to generate return if we suffer through a prolonged down or sideways market. As such, my latest screen honed on these stocks using the following criteria:

Q1 2009 Earnings Call

May 7, 2009 5:00 pm ET

Looking at three of these retailers in more detail highlight the issues, both good and bad, that are shaping the market right now. The figures we have compiled at retailers Sephora (which is part of LVMHF.PK), Weight Watchers (WTW) and Limited Brand's Victoria's Secret (LTD) do highlight that times are not necessarily the best, but the stores still are certainly open for business.

For those who have been following my outlook over the past two years, you know that I have been extremely bearish most of the time but have suffered from temporary insanity in trying to call interim or even ultimate bottoms. I had some success last year in doing so (certainly not with my horrible call last May!), but clearly this is a game that is rapidly losing participants. When I first realized we were in for a terrible bear market in the summer of 2007, I was worried that I didn't know how it might end. At the time, I was most concerned about housing and guessed that the end would be the nationalization of the GSEs. Nope, that wasn't it!

Over the past few months, as we have gotten by definition closer to the bottom both in time and in level, I have gained further clarity regarding how to tell that the economy is at a bottom, and it isn't anytime soon. I have identified three major signs to look for when anticipating an end to this depression:

Another barrage of selling swept through the equity market and sent stock prices sharply lower Thursday. The day was off to a rocky start after auditors warned that General Motors (GM) might not survive as a going concern. While GM skidded, the financials also faltered on news Moody's is reviewing Wells (WFC) and BofA (BAC) for possible credit rating downgrades. (No, really?). JPM had its outlook lowered. Some pre-employment jitters ahead of Friday's payroll numbers likely affected trading as well.

Thursday's economic numbers were mixed. Data released before the market showed productivity falling at a .4 percent rate in the fourth quarter. Economists had predicted a 1 percent increase. Unit labor costs, meanwhile, jumped 5.7 percent during that time. Economists were expecting a more modest 3.8 percent. Weekly jobless claims were a bit better-than-expected. According to the Labor Department, jobless claims fell by 31,000 to 639,000 in the final week of February. Economists had predicted a decline of 20,000. A final report released 30 minutes into the trading session showed factory falling 1.9 percent in January, which was not nearly as bad as the 3.5 percent decline economists had been expecting.

• Underwater homeowners get a rescue. The White House launched its $75B foreclosure relief plan yesterday as new data showed 20% of homeowners with mortgages are "under water," or owe more than their house is worth. The program, which could help as many as 1 in 9 homeowners, offers cash incentives to loan servicers to cut monthly payments, will modify mortgages on single-unit homes up to $729,750 (with a higher limit for multiple-unit properties) and will apply only to loans originated before January 1. In the past, being under water ruled out the possibility of refinancing, but the new plan will allow homeowners with negative home equity to modify their loans. Still, as with any broad effort, the foreclosure relief plan creates distinct winners and losers among homeowners. Obama is also pushing for legislation to allow bankruptcy judges to alter loan terms; the House of Representatives is expected to pass a bill today allowing these mortgage "cramdowns."
• UBS stays mum. UBS (UBS) has refused to provide the U.S. government with the details of 52,000 clients as part of a tax evasion probe, arguing that doing so would violate Swiss law. Last month, UBS agreed to pay $780M and disclose around 300 client names as part of a separate tax evasion settlement. Testifying in the Senate yesterday, UBS exec Mark Branson said bank officials "believe that UBS has now complied with the summons to the fullest extent possible without subjecting its employees to criminal prosecution in Switzerland," as the Swiss government recognizes only tax fraud, not tax evasion, as a crime. UBS therefore suggested the dispute should be resolved through diplomacy, not a legal suit. However, a top Justice Department official warned the agency may prosecute senior UBS executives.
• Fed okays CDS clearinghouse. The Federal Reserve approved a credit-default swap clearinghouse plan presented by IntercontinentalExchange (ICE), leaving SEC approval as the final hurdle for the futures clearinghouse. Intercontinental has been competing with three rivals, including CME Group (CME), to back the $27T CDS market; the winner stands to gain up to $400M annually in revenue. An SEC spokesman said Intercontinental's proposal is 'under active consideration' but he didn't know when the agency would make a decision.
• Beige book sees long recession. The Fed's Beige Book noted consumer spending remained sluggish on the whole, although many districts saw some improvement in January/February after a dismal holiday season. Travel and tourism fell noticeably, and manufacturing declines were pronounced. A near-term recovery looks unlikely, "with a significant pickup not expected before late 2009 or early 2010." (Read the Fed's summary or full report)
• Subpoenas for Merrill's merry millionaires. New York Attorney General Andrew Cuomo has issued subpoenas to seven top Merrill Lynch executives who received over $10M in cash and stock last year. Among the execs are top investment banker Andrea Orcel, global sales and trading chief Thomas Montag and former head of strategy Peter Kraus, each of whom made more than $25M apiece in 2008. Cuomo is investigating whether the bonus payments violated securities laws, and will ask the execs about their individual bonuses, their communications with John Thain and the timing of the bonuses. Bank of America (BAC) has filed a petition in New York state court to keep the pay data confidential.
• Ford's new debt plan. Ford (F) launched a major debt restructuring and plans to cut up to $10.4B, or around 40% of its debt, by offering cash and new shares to creditors. The automaker will make up to $2.2B in cash available for the restructuring, and is paying between $0.30-$0.55 on the dollar as an incentive to convert debt. Following the announcement, S&P cut Ford's credit rating to CC from CCC+, calling the move a distressed debt exchange but noting the downgrade does not reflect an increase in Ford's risk of bankruptcy. Fitch left its rating unchanged at CCC.
• Hartford may sell life unit to Sun Life. Sources say Hartford Financial Services (HIG) is in talks to sell most of its unprofitable life insurance unit to Canada's Sun Life Financial (SLF). Hartford has suffered from three credit-rating downgrades, and has watched its share price plunge 72%. As recently as this week, S&P cut the company's rating to BBB, saying losses at the life division, which has $247.9B of assets, are threatening the other half of the company. Hartford had previously held talks with MetLife (MET) but no agreement was reached.
• MGM loan talks collapse. MGM Mirage (MGM) and Dubai World failed to reach an agreement with Deutsche Bank (DB), according to people close to the situation, and talks on a $1.2B loan to complete the Las Vegas CityCenter project have collapsed. Deutsche had been seeking equity and debt stakes in the $11.2B Las Vegas development. MGM Mirage and Dubai World are now said to be holding talks with other parties. Yesterday, MGM Mirage also warned it may breach its debt covenants this year if economic conditions worsen.
• Wyeth loses key drug case. Wyeth (WYE) lost a key court case, as the Supreme Court ruled drugmakers can be sued in state court over alleged drug defects, even if the FDA has already approved a medicine's use and the attached warning label. The decision eases the way for liability lawsuits, and could have significant implications for industries beyond pharmaceuticals. Justice John Paul Stevens wrote on behalf of the court that with 11,000 drugs on the U.S. market, the FDA's own advisory panels have said they lack the resources to protect the public.
• YouTube said to be in talks on music website. YouTube (GOOG) is said to be in talks with Vivendi's Universal Music Group to create an online music website with the working title "Vevo." Universal approached YouTube at the end of last year and proposed a site that would include videos from all the major music labels, with YouTube providing the technology to sell ads accompanying the videos. Discussions are in an advanced stage but could still fall apart.
• China holds back from new stimulus. The Shanghai Composite Index gained over 6% yesterday on expectations that new Chinese stimulus measures would be announced today, but investors were left disappointed when no such announcement came. In his annual speech to China's parliament, Premier Wen Jiabao said an 8% growth target is within reach this year, signalling the government sees an additional stimulus as unnecessary. The IMF forecasts just 6.7% growth for the country, the slowest rate in nearly 20 years.
• Germany provides corporate credit. Germany created a €100B ($126B) fund to help corporations struggling with tight credit conditions. The fund will offer €75 billion in liquidity guarantees and €25 billion in direct loans. GM's (GM) German unit Opel could be one of the first companies to tap the fund, after GM Europe warned it needs €3.3 billion in aid.
• Job cuts. Challenger reported that firing announcements fell 23% in February vs. the month before, to 186,350, but were up 158% Y/Y. "The decline in job cuts last month offers some hope that January was the peak and we will now see layoffs begin to fall or at least stabilize." However, ADP reported (.pdf) that the private sector shed 697,000 jobs in February, worse than the -630,000 economists expected and a big drop from January's -614,000 (revised from -522,000). Monster's online employment index edged up 4 points in February to 122, but is down 26% Y/Y. "The gain in the February Index is the first since October of 2008.... suggests that traditional annual hiring cycles remain somewhat intact."
• BoE rate cut. As expected, the Bank of England cut its key rate by half a percentage point this morning to 0.5%. BoE said lowering its key rate probably won't suffice, and resolved to take further actions to boost money supply, including buying up £75B of public- and private-sector debt - mainly the former - over the next three months.
• More non-mfg contraction. Economic activity in the non-manufacturing sector contracted in February, registering 41.6% on the ISM Index vs. January's 42.9%. This is the fifth month in a row of sector contraction.

Earnings: Thursday Before Open

• Canadian Natural Resource (CNQ): Q4 EPS of $1.29 beats by $0.53. Revenue of $2.5B (-21.5%) vs. $2.1B. (PR)
• Ciena (CIEN): FQ1 EPS of -$0.09 misses by $0.02. Revenue of $167M (-26.4%) vs. $172M. (PR)
• Talisman Energy (TLM): Q4 EPS of $0.53 beats by $0.16. Revenue of $2.20B (-8.1%) vs. $2.25B. (PR)
• Urban Outfitters (URBN): Q4 EPS of $0.24 misses by $0.04. Revenue of $508M (+9.2%) vs. $515M. (PR)

Earnings: Wednesday After Close

• Adobe (ADBE): Sees FQ1 EPS of $0.44-0.45 vs $0.42 consensus and revenue of $783-786M vs. $792M. Sees FQ2 revenue of $675-725M vs. $776M consensus. Shares +8.8% premarket. (PR)
• Foot Locker (FL): Q4 EPS of $0.24 beats by $0.08. Revenue of $1.32B vs. $1.37B. Shares -3.7% AH. (PR)
• Gymboree (GYMB): Q4 EPS of $1.00 beats by $0.02. Revenue of $289M in-line. Sees Q1 EPS of $0.18-0.25 vs. consensus of $0.76, and negative comps in the range of 20-25%. Shares -32.1% AH. (PR)
• Jackson Hewitt (JTX): FQ3 EPS of $0.74 beats by $0.02. Revenue of $97.8M vs. $104.7M. Sees 2009 EPS of $1.00-1.10 vs. $1.48 consensus and revenue of $250-255M vs. $295M. Shares -3% AH. (PR)
• PetSmart (PETM): Q4 EPS of $0.62 beats by $0.03. Revenue of $1.36B in-line. Sees 2009 EPS of $1.40-1.50 vs. $1.49 consensus and revenue growth in mid-to-high single digits. Shares -4.4% AH. (PR)
• Sigma Designs (SIGM): Q4 EPS of $0.38 beats by $0.20. Revenue of $1M (-38%) vs. $47.3M. "The IPTV market is showing resiliency to the current economic turmoil and we are confident that it will continue to demonstrate strength throughout this year." Shares +9.7% AH. (PR)
• Weight Watchers International (WTW): Q4 EPS of $0.56 beats by $0.04. Revenue of $338M (-1.6%) vs. $356M. 2009 guidance in-line with Street. Shares +6.6% AH. (PR)

Today's Markets

• Asia markets were mixed Thursday after China Premier Wen reaffirmed the country's 8% growth goal for 2009, but was silent on the much-rumored extra stimulus money that sent Shanghai soaring Wednesday. Nikkei +1.95% to 7,433. Hang Seng -0.97% to 12,211. Shanghai +1.04% to 2,221. BSE -2.94% to 8,198.
• In Europe, markets are sagging at midday. London -2.5%. Paris -2.2%. Frankfurt -2.6%.
• U.S. stock futures failed to carry Wednesday's strength into the overnight session. Dow -1.3% to 6740. S&P -1.7% at 697. Nasdaq -0.8%. Crude -2.7% to $44.15. Gold +1.1% to $917. 30-year Tsys +1.01%.

Thursday's Economic Calendar

• 6:00 Chain Store Sales
  6:00 Monster Employment Index
  7:00 BoE Announcement
  7:45 ECB Announcement
  8:30 Jobless Claims
  8:30 Productivity and Costs
  9:00 RBC CASH Index
  10:00 Factory Orders
  10:00 Fed's Kohn testifies on AIG
  10:30 EIA Natural Gas Report
  4:30 PM Money Supply
• Notable earnings before Thursday's open: CIEN, CNQ, TLM, URBN
• Notable earnings after Thursday's close: IPI, MRVL

Seeking Alpha editor Eli Hoffmann contributed to this post.

Q4 2008 Earnings Call

March 4, 2009 5:00 pm ET

Bullish Calls:

Simply stated, when consumers are facing a sudden crisis over their savings, livelihood, and standard of living, the natural inclination is to comfort eat, not to lose weight. From an historical perspective, we saw similar behavior in the aftermath of 9/11 and Hurricane Katrina. The impact those two events had on our business lasted about six and three weeks respectively, but we think this current crisis will last longer.-- David P. Kirchhoff - President, Chief Executive Officer and Director, Weight Watchers International (11/4/08) (source: Seeking Alpha)

I have to admit I really like this guy for his honesty. I also have to admit that I think that Weight Watchers (WTW) (26.67, $2 billion market cap) is a tremendous brand and one of the few weight-loss companies that has a proven track record over the years. With that said, despite the fact that the stock is way down from its levels a year ago and even more from its all-time high in 2007 (and 2005) and that it trades at "just" 9.5X the current analyst consensus for 2009, I think that the stock will continue to be pressured.

• Obama wins, futures move lower. European markets and U.S. futures traded lower overnight (see data below) as investors, perhaps, emerged from their election-induced elation and began thinking about the mess President-elect Barack Obama will inherit. Still, analysts at BNP Paribas were optimistic about the leadership change: "Obama has strong personal, political and institutional assets... his program is relatively well adapted to America's needs, in the fields of energy, healthcare, social cohesion and competitiveness." UBS analysts said winners of an Obama victory would be hospitals and nursing-home operators, life-sciences, natural gas firms, solar and life insurers, while losers would include big pharma, managed care, high-end consumer, coal and utilities and integrated oils. More.
• MT misses, paints gloomy picture. ArcelorMittal (MT) reported Q3 profit rose 29% to $3.82B, short of $5.82B analyst estimates, and sales were up 37.9% Y/Y to $35.2B. However, the company warned Q4 earnings (before Ebitda) could fall to $2.5B-$3B from $8.58B in Q3, while analysts expect the current fall in steel prices to hurt Arcelor well into 2009. The company also announced plans for steep production cuts. Output of flat carbon steel will be cut by up to 35% in the U.S. and up to 30% in Europe. Stainless steel supplies and output will be reduced in Asia and Africa. Shares -18% premarket.
• Shell says OPEC cuts lead to force majeure. Shell (RDS.A) declared force majeure on some of its Nigerian crude exports due to OPEC's recent decision to reduce output by 1.5M b/d. The move indicates that Nigeria - a nation with a sketchy history of OPEC compliance - is indeed taking steps to pare production in compliance with OPEC's production cut; some doubted whether OPEC could force member nations to comply. Some Shell customers don't think the OPEC reduction justifies a force majeure declaration.
• Corn Products wants out of Bunge deal. Corn Products International (CPO) said it will withdraw its recommendation of Bunge's (BG) takeover bid. Originally valued at $4.2B, the value of the all-stock offer has plunged 63% along with Bunge's shares. Bunge replied, saying it has no intention to increase its bid: "Despite the effect of unprecedented turmoil in the equity markets on our companies' stocks, Bunge's board of directors and management continue to believe a merger with Corn Products as currently structured would deliver significant value." CPO is the the fourth-largest maker of high-fructose corn syrup in the U.S.
• Mixed bag for e-shopping. Online retailers say sales growth will slow this holiday season, but will still beat last year's by 15%. "Online retailers are resilient when it comes to the economy, but they're not immune," one industry official said, adding, "It's challenging to keep up those really high growth rates." On the other hand, the ease with which online shoppers can comparison shop and saving on gas could appeal to cash-strapped shoppers. Most retailers say they'll offer free shipping, although some are raising the minimum purchase requirement.
• Consumer spending dries up. MasterCard Advisors reported consumers slashed spending in October, especially on larger purchases, as the financial crisis made for lighter wallets and heavier economic worries. Michael McNamara, vice president at MasterCard Advisors, said 'the numbers for October are very negative across the board,' and in particular 'sales above $1,000 just aren't really moving.' Savings-conscious spenders helped fast food restaurant sales rise 1%. Lowlights: Home decor -20.6%. Electronics -19.9%. Women's apparel -18.2%.
• Lending rates ease, but still elevated. Three-month Libor fell 20 BPs to 2.51% today, down from 4.82% on Oct. 10. Still, the rate remains 151 BPs higher than the Fed's target of 1% - compared to its average spread of just 22 BPs. "Banks are cutting back, the economy is in a deepening recession and in that environment, I don't think banks are going to become a lot more willing to extend credit soon," Goldman Sachs economist Jan Hatzius said.
• CDS data less daunting than feared. Data released by the DTCC shows credit-default swap traders took out a net $22.7B of contracts on Italy's debt, $16.7B against Spain and $12.5B on Deutsche Bank (DB). Outstanding transactions total $33.6T, a smaller sum than many had estimated, which may ease concerns that the much-maligned instrument is at fault for much of the recent financial market volatility. "Far too much mistrust has been engendered by the lack of transparency," CreditSights' Brian Yelvington said. "There's still a lot here that's not captured. But it's a step in the right direction." For instance, outstanding contracts on Lehman debt were only $72B, while estimates ranged as high as $400B. After subtracting redundant trades, only $5.2B actually changed hands.
• FCC signs off on Sprint/Clearwire combo. The FCC approved Sprint's (S) acquisition of Clearwire (CLWR), a merger considered critical to Sprint's survival in the wireless market. The Justice Department must still sign off on the deal. Afterhours S +7.2%, CLWR +21.8%. Meanwhile, Sprint faces a class-action lawsuit over claims that it wrongly charged subscribers $1.2 billion in early-termination fees. Sprint called the "suit cynical and opportunistic."
• Diabetes drug delay. The FDA said it isn't satisfied with data supporting a once-weekly version of the diabetes drug Byetta, currently injected twice a day. The likelihood of a delay of the drug's introduction sent its developers Amylin (AMLN) plunging 25.8% and Alkermes (ALKS) down 9.8%.
• Factory Orders fell 2.5% in September, far worse than the -0.7% consensus. It was the second consecutive monthly decrease. Ex-transportation, orders were off 3.7%, the largest percent decrease since 1992.
• National chain store sales fell 1.2% in the four weeks of October vs. September, Redbook says, but gained 0.6% vs. a year ago. According to ICSC, chain-store sales rose 0.9% last week vs. a year ago and 0.6% vs. the week before. Consumers continued to spend on everyday items.

Earnings: Wednesday Before Open

• Agrium (AGU): Q3 EPS of $2.31 beats by $0.42. Revenue of $3.11B (+214.8%) vs. $2.24B. (PR)
• Ambac (ABK): Q3 EPS of -$7.81 misses by $7.31. Net mark-to-market losses on credit derivatives of $2.7B. Shares -19%. (PR)
• Aqua America (WTR): Q3 EPS of $0.26 beats by $0.01. Revenue of $177M (+7%) in-line. (PR)
• ArcelorMittal (MT): Q3 EPS of $2.79 misses by $1.22. Revenue of $35.2B (+37.9%) vs. $38.8B. "We remain optimistic about the industry's medium-term growth prospects, but it is appropriate to pause our growth strategy until we have a more settled economic outlook." Shares -16.2%. (PR)
• Becton Dickinson (BDX): FQ4 EPS of $1.13 beats by $0.02. Revenue of $1.84B (+11.2%) vs. $1.81B. (PR)
• CenterPoint Energy (CNP): Q3 EPS of $0.39 beats by $0.18. Revenue of $2.52B (+33.6%) vs. $2.1B. Shares (PR)
• Checkpoint Systems (CKP): Q3 EPS of $0.32 misses by $0.05. Revenue of $234M (+14.4%) vs. $245M. Sees full-year EPS of $1.21-1.27 vs. $1.34 and revenue of $920-935M vs. $966M. (PR)
• CMS Energy (CMS): Q3 EPS of $0.34 beats by $0.08. Revenue of $1.43B (+11.4%) vs. $1.34B. (PR)
• Cognizant Technology Solutions (CTSH): Q3 EPS of $0.40 beats by $0.03. Revenue of $735M (+7.2%) vs. $723M. (PR)
• Corinthian Colleges (COCO): FQ1 EPS of $0.07 in-line. Revenue of $290M (+18.4%) in-line. Student starts were 30,075 vs. 28,030 (+7.3%). (PR)
• Devon Energy (DVN): Q3 EPS of $3.09 beats by $0.03. Revenue of $5.98B (+116.4%) vs. $4.02B. Shares +1.2%. (PR)
• Dollar Thrifty Automotive (DTG): Q3 EPS of $0.89 beats by $0.29. Revenue of $501M (-4.1%) in-line. (PR)
• Domtar (UFS): Q3 EPS of $0.10 in-line. Revenue of $1.63B (-2.1%) in-line. "The depth and duration of the economic slowdown and the impact this may have on office employment and demand for our products are uncertain," company says. (PR)
• Donnelley & Sons (RRD): Q3 EPS of $0.87 beats by $0.01. Revenue of $2.86B (-1.6%) vs. $3.04B. (PR)
• Duke Energy (DUK): Q3 EPS of $0.33 misses by $0.12. Revenue of $3.51B (-4.9%) vs. $3.92B. Sees full-year EPS of $1.22 vs. $1.27. (PR)
• El Paso Electric (EE): Q3 EPS of $0.74 misses by $0.06. Revenue of $153M (+1.5%) vs. $298M. (PR)
• Foster Wheeler (FWLT): Q3 EPS of $0.89 misses by $0.02. Revenue of $1.72B (+32.2%) in-line. (PR)
• General Growth Properties (GGP): Q3 FFO of $0.64 misses by $0.12. Revenue of $815M (+5.7%) vs. $865M. Sees full-year FFO of $2.85-2.95 vs. $3.31. (PR)
• Gerdau AmeriSteel (GNA): Q3 EPS of $0.73 beats by $0.09. Revenue of $2.51B (+80%) vs. $2.68B. (PR)
• Hospira (HSP): Q3 EPS of $0.63 in-line. Revenue of $925.5M (+10.4%) vs. $899M. (PR)
• IAC/InterActiveCorp (IACI): Q3 EPS of $0.25 beats by $0.09. Revenue of $369M (+10.1%) vs. $355M. (PR)
• Kimco Realty (KIM): Q3 FFO of $0.68 in-line. Sees full-year FFO of $2.20-2.45 vs. $2.68. (PR)
• Marsh & McLennan (MMC): Q3 EPS of $0.21 misses by $0.11. Revenue of $2.84B (+4.5%) in-line. (PR)
• Medco Health Solutions (MHS): Q3 EPS of $0.63 beats by $0.01. Revenue of $12.56B (+15%) in-line. (PR)
• MetroPCS Communications (PCS): Q3 EPS of $0.13 misses by $0.02. Revenue of $687M (+23.3%) vs. $711M. (PR)
• MF Global (MF): FQ2 EPS of $0.21 beats by $0.02. Revenue of $373M (-14.4%) vs. $367M. (PR)
• Molson (TAP): Q3 EPS of $0.95 misses by $0.01. Revenue of $921M (-45.3%) vs. $932M. (PR)
• Parker Drilling (PKD): Q3 EPS of $0.20 misses by $0.02. Revenue of $227.5M (+32.1%) vs. $233M. (PR)
• Polo Ralph Lauren (RL): FQ2 EPS of $1.58 beats by $0.33. Revenue of $1.43B (+10%) vs. $1.36B. (PR)
• PolyOne (POL): Q3 EPS of $0.13 beats by $0.03. Revenue of $735M (+10.6%) vs. $719M. "While our results for the third quarter were modestly better than anticipated, our fourth quarter earnings may fall short of our previous expectations." (PR)
• Radian Group (RDN): Q3 EPS of $0.46 vs. consensus of -$1.93. (PR)
• Quanta Services (PWR): Q3 EPS of $0.29 beats by $0.03. Revenue of $1.05B (+60.6%) in-line. (PR)
• Quicksilver Resources (KWK): Q3 EPS of $0.41 beats by $0.07. Revenue of $236M (+48.4%) vs. $228M. (PR)
• Sara Lee (SLE): FQ1 EPS of $0.32 beats by $0.09. Revenue of $3.35B (+9.7%) in-line. Sees full-year EPS of $0.77-0.84 vs. $0.96 and revenue of $13-13.3B vs. $13.89B. (PR)
• SkyWest (SKYW): Q3 EPS of $0.45 misses by $0.03. Revenue of $934M (+6.7%) in-line. (PR)
• Time Warner (TWX): Q3 EPS of $0.30 beats by $0.03. Revenue of $11.71B (+0.3%) vs. $11.9B. (PR)
• Time Warner Cable (TWC): Q3 EPS of $0.31 beats by $0.03. Revenue of $4.34B (+8.5%) in-line. (PR)
• Total (TOT): Q3 profit of €4.07B vs. €3.85B consensus. EPS of €1.81 vs. €1.32 a year ago. Despite crude's recent fall, Total expects higher oil prices in the medium to long term. (Bloomberg)
• Transocean (RIG): Q3 EPS of $3.44 misses by $0.05. Revenue of $3.19B (+107.5%) in-line. (PR)
• United States Cellular (USM): Q3 EPS of $1.02 beats by $0.37. Revenue of $1.09B (+7.5%) in-line. (PR)
• XTO Energy (XTO): Q3 EPS of $1.00 beats by $0.02. Revenue of $2.13B (+49.5%) in-line. Shares -0.7%. (PR)

Earnings: Tuesday After Close

• Blue Nile (NILE): Q3 EPS of $0.15 misses by $0.01. Revenue of $67.4M vs. $68.8M. Shares -12.5%. (PR)
• BRE Properties (BRE): Q3 FFO of $0.72 beats by $0.03. Revenue of $89.4M (+7.5%) vs. $86.1M. Shares +2.4%. (PR)
• D.R. Horton (DHI): Sees FQ4 home sales revenue of $1.5B vs. $1.59B consensus, and net loss of $800-900M. Sees land impairment charges of $1.1B. "Market conditions in the homebuilding industry deteriorated during our fourth fiscal quarter and October, characterized by rising foreclosures, high inventory levels of both new and existing homes and reduced liquidity in the mortgage markets." Shares +3.7%. (PR)
• HealthSouth (HLS): Q3 EPS of $0.15 beats by $0.08. Revenue of $456M (+6.5%) in-line. Shares +10%. (PR)
• Jack Henry & Associates (JKHY): FQ1 EPS of $0.26 misses by $0.01. Revenue of $183M (+4.7%) vs. $187M. Shares -0.8%. (PR)
• Pioneer Natural Resources (PXD): Q3 EPS of $0.91 misses by $0.30. Revenue of $612M (+33.4%) vs. $664M. Shares -10.4%. (PR)
• The Andersons (ANDE): Q3 EPS of $0.70 beats by $0.06. Revenue of $906M (+63.6%) vs. $806M. Shares +0.4%. (PR)
• Ultra Petroleum (UPL): Q3 EPS of $0.78 beats by $0.07. Revenue of $298M (+153.9%) in-line. Shares +2.1%. (PR)
• USEC (USU): Q3 EPS of $0.06 in-line. Revenue of $590M (-7%) vs. $463M. Shares -6%. (PR)
• Ventas (VTR): Q3 FFO of $0.69 misses by $0.02. Revenue of $125M (+5.2%) vs. $121M. (PR)
• Weight Watchers (WTW): Q3 EPS of $0.70 beats by $0.03. Revenue of $353M (+4.5%) in-line. Shares +5.9%. (PR)
• Yamana Gold (AUY): Q3 EPS of $0.05 misses by $0.05. Revenue of $247M (+23.9%) vs. $317M. (PR)

Today's Markets

• Asia markets were mainly higher. Nikkei +4.46% to 9,521. Hang Seng +3.17% to 14,840. Shanghai +3.16% to 1,761. BSE Sensex -4.81% to 10,120.
• In Europe, markets are lower at midday. London -1.45%. Paris -2.1%. Frankfurt -1%.
• U.S. futures are down. Dow -0.8%. S&P -1.1%. Nasdaq -1%. Crude -2.5% to $68.73. Gold +0.5% to $761.

Wednesday's Economic Calendar

• 7:00 MBA Mortgage Applications
  7:30 Challenger Job-Cut Report
  8:15 ADP Jobs Report
  10:00 ISM Non-Manufacturing Survey
  10:35 EIA Petroleum Status
• Notable earnings before Wednesday's open: ABK, AGU, BBG, BDX, CHB, CMS, CNP, COCO, CSE, CTSH, DLR, DUK, DVN, FWLT, GGP, GNA, HSP, IACI, KIM, KWK, MBI, MF, MHS, MMC, PCS, PKD, PWR, RAS, RDN, RIG, RL, RRD, SLE, SVR, TAP, TWC, TWX, UFS, WTR, XTO
• Notable earnings after Wednesday's close: AHT, ATVI, AVB, BDN, BEE, BEXP, CCI, CDNS, CECO, CEDC, CNO, CSCO, DOX, EGLE, EXM, GDP, GXP, HTZ, KEG, LEAP, MDR, NWS, OKE, PVA, SCI, SHO, SUN, SVNT, THQI, TWTC, URS, VMC, WFMI, XCO

Seeking Alpha editor Rachael Granby contributed to this post.

Q3 2008 Earnings Call

November 4, 2008 5:00 pm ET

Over the past few years, we've heard all about how one should invest in funeral homes, health care and pharma companies, as these will all be needed by the growing elderly population. While this will eventually be true, it is important to point out that the largest part of the baby-boom is not yet at the age to need these things to a large degree. Most of the baby-boomers were born between 1955 and 1963, meaning that they are mostly in their "empty-nest years". This is the time when people have money to spend and time to spend it…..so, where might they spend it?