One Page Barron's Summary


Here's a one page summary of leading stories from this weekend's (May 3) Barron's (paid sub. req.), noting stocks to watch for Monday morning when the market opens and brief comments on the Barron's articles. Note: clicking on a stock ticker pulls up opinion, analysis and a quote for that stock; clicking on a headline takes you to the full Barron's article (paid sub. req'd.).

Bow Tied Commodity Bull by Jonathan R. Laing

Highlighted companies: DB Commodity Index Tracking Fund (NYSEARCA:DBC)
Thesis: Profile of Jim Rogers, hedge fund manager turned famous commodities bull, who has been proven prophetic with the recent runup in commodities markets. He believes the commodities run has another 8-14 years left in it, based on historical precedence, and that this ongoing rally will take place alongside a downturn in equities. Rogers now offers commodities index funds through his Beeland Managment.
Quick comment: See Seeking Alpha contributor Roger Nusbaum's response to the article

Beware The Spent Customer by Sandra Ward

Highlighted companies: Wal-Mart Stores (NYSE:WMT), Magna International (NYSE:MGA), General Motors (NYSE:GM), Ford (NYSE:F)
Thesis: Interview with Steve Romick, Portfolio Manager, FPA Crescent Fund. Romick's fund is up 13.6% average for the past five years, but he's currently 'frustrated... this isn't a target-rich environment.' Romick thinks we may be entering the worst consumer slowdown since the Great Depression. Nonetheless, he likes Wal-Mart as 'an infinite-duration bond with a rising coupon' and auto parts firm Magna International. He thinks auto investors are mistaken by chasing the recent runup, since there's no real light at the end of the tunnel: 'the light at the end of the tunnel is the light of an oncoming train, not sunlight.'

Micron's New Muscle by Bill Alpert

Highlighted companies: Micron Technology (NASDAQ:MU), Lexar Media (LEXR), Intel (NASDAQ:INTC), OmniVision (NASDAQ:OVTI)
Thesis: Micron has recently been boosting its DRAM memory chip sales outside of the PC sphere and expanding into higher-growth NAND flash memory in a joint venture with Intel. It's attempting to purchase flash memory company Lexar Media. The stock's up more than 60% in the past year, but Alpert still feels that 'if Micron can string together a few years of steady growth, its stock may prove a good investment'.
Quick comment: Look for MU shares to get a pop at the open today following this positive writeup.

A Sunny View of Cypress by Bill Alpert

Highlighted companies: Cypress Semiconductor (NASDAQ:CY), SunPower (NASDAQ:SPWR)
Thesis: Despite some disappointments in its semiconductor businesses, Cypress' most exciting sector at present makes solar cells -- it owns SunPower, which made an IPO last year and a followup offering last week. The CEO of Cypress says SunPower's cells are 1/3 more efficient than other solar films. Alpert notes 'if you like SunPower you should love its parent company Cypress, whose SunPower stake is worth $1.7 billion at SunPower's recent share price. The stock market is valuing all of Cypress at $2.3 billion, so you get the rest of Cypress for about half of its annualized revenues and a very cheap multiple of its non-solar earnings.'

Gold Rally Should Keep Running by Michael Kahn

Highlighted companies: Gold ETFs (NYSEARCA:GLD) and (NYSEARCA:IAU)
Thesis: Technical analyst Kahn believes that gold will go higher, and is simply experiencing a retracement at this point. If gold drops to $600/ounce, he believes that provides a good entry point for new investors.
Quick comment: See Seeking Alpha contributor Roger Nusbaum's response to the article

Playing Defense to Win by Neil A. Martin

Highlighted companies: Northrop Grumman (NYSE:NOC) , General Dynamics (NYSE:GD), DRS Technologies (DRS), L-3 Communications (NYSE:LLL)
Thesis:Northrop has outpaced its competitors with homeland-security sales growing three times as fast as its total revenues. The company's unmanned aerial vehicles [UAVs] should find a growing market against US border violators, and globally. Northrop's business model of producing next-generation systems that allow for smaller and smarter forces also lines up nicely with defense budgets aimed in that direction. But NOC shares seem to get no respect on the Street. Analysts are starting to get behind the stock -- Credit Suisse's Robert Spingarn is quoted stating that it may rise to $77 from the current $65 within 12 months. Other major defense contractors should profit alongside NOC from growing US defense budgets.

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