Monday, April 17, 2006

Monday Morning Musings

Morning News of Note:
  • GLW: Heard on the Street... Corning Sees the Light in LCDs Corning Inc., which once made the glass for Thomas Edison's light bulbs, was on the verge of bankruptcy in 2002. Now, a year after posting its first profit since the telecommunications-stock bust that started around 2000, the 150-year-old manufacturer has a market value of about $42 billion. Corning, which had 2005 sales of $4.58 billion and profit of $585 million, bounced back mainly by becoming the world's largest producer of ultrapure glass for liquid-crystal-display panels, or LCDs, which feed consumers' hunger for giant flat-panel television sets and continuing demand for laptop screens. (Full Story) WSJ
  • NSC: Railway Operator Gaining Speed, Thanks To Strong Industry Trends If it's not exactly the golden age of railroads, it's pretty close. Railcars are in great demand for carrying everything from coal to sea containers, and rail rates are the highest they've been in decades. Orders began to improve in late 2003 as the U.S. economy and global trade picked up steam, resulting in volume growth in 2004 and 2005. (Thursday) (Full Story) IBD
  • Ethanol: CORNPONE REMEDY BUSH FUEL PLAN IS VINTAGE CARTER, BUT WHO CARES? WE'LL call it the Ethanol Rule, in recognition of some wisdom found lurking in President Bush's State of the Union address back in January, and it boils down to this: In the short attention span theater of American life, anything that happened more than 20 years ago may safely be assumed never to have happened at all. (Full Story) NY Post
  • TIVO DISH: Tivo-TIVO wins case in Texas against EchoStar Comm-DISH: "TiVo is pleased that the jury found that TiVo's pioneering time warping patent is valid and that EchoStar has been infringing on our intellectual property. TiVo is particularly gratified that the jury found that EchoStar willfully infringed on our patent and the consequences their actions had on our overall business. This decision recognizes that our intellectual property is valuable and will ensure that moving forward EchoStar and any others that want to use our patented technology will be required to provide us with compensation."
  • Mad Money Summary: Cramer opened his show stating that he wants to help his viewers get revenge for how much they are paying at the pump. He said the best pure play on oil was Occidental Petroleum (OXY), which has "the most to gain from high crude prices." Another great oil play is Energy Partners (EPL), which is leveraged to getting new oil. Then Cramer discussed Advanced Micro Devices (AMD) and Intel (INTC), saying that Intel does not have "the essential qualities" to mount a comeback against AMD. He believes AMD will continue to take market share from Intel. Cramer then discussed VeriFone Holdings (PAY), which acquired Lipman Electronic Engineering (LPMA), a move Cramer feels "was brilliant and should propel the stock higher." In the Lightning Round, Cramer was bullish on LifeCell (LIFC), Schering-Plough (SGP), Copart (CPRT), Starbucks (SBUX), Charming Shoppes (CHRS), CarMax (KMX), Chartered Semiconductor (CHRT), Northern Orion Resources (NTO), Matsushita Electric (MC), PerkinElmer (PKI) and Coach (COH), and was bearish on Sirius Satellite Radio (SIRI), Chevron (CVX) and Sony (SNE).

Market Comments: The market has opened on a slightly positive note this morning, despite the fact that oil has popped above the $70 level, albeit it briefly. Bond yields are flat around 5.03% on the 10-year.

Citigroup (NYSE:C) reported better than expected earnings this morning, and also announced a $10 billion stock buyback. Overall, the financial sector is up, led once again by the broker group.

Tech stocks are also getting a nice bounce, with the alternative energy group looking especially strong. Biotechs are once again lagging.

Earnings season will kick into full gear this week, and it will be interesting to see how stocks react to these earnings reports. That is often the best indication of investor expectations.

I'll be back with a sentiment check for my next post.

long C, GLW


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