Wall Street Dispatch » WSD Staff

Cyprus ETF Plays

WSD Staff — Tue, 19 Mar 2013 17:29:06 +0000

The European debt crisis seems to be a never ending soap opera. The latest episode is the current situation in Cyprus where a levy on deposits has been floated over the weekend. The Cyprus story has been covered extensively in the financial media. Below we will cover some of the instruments you can use to execute your views on this situation – be it bearish or bullish.

To keep our analysis simple, we will tackle two main views on the current Cyprus situation. The first says that the Cyprus situation is a harbinger of more bad news to come that will negatively impact risky assets in both Europe and the US with particular losses in the Euro currency against the US dollar. The other view is somewhat contrary to the first and posits that Cyprus is too small to matter on a global scale and any drop in stocks or even the EUR/USD are good buying opportunities.

The bearish narrative says that:

European stocks will decline and so will US stocks in sympathy.
Volatility will increase.
EUR/USD will drop as investors sell Euros.
Perceived risk-free assets will go up as investors plow money into US treasury bonds as well as German Bunds.
Demand for gold as a safe haven bet will increase pushing the price of the yellow metal upward.

Such macro plays have been traditionally hard for retail investors to participate in but with the prevalence of ETFs there is an exchange traded fund for pretty much any theme you can think of.

Below are some of our editor’s picks:

For European Stocks ETFs:

Note that there is no Cypress ETF that you can trade but below are some other ETFs based on European stocks linked in some way to the crisis in Cyprus.
Global X FTSE Greece 20 (GREK)
Market Vectors Russia ETF (RSX)
iShares MSCI Italy Index Fund (EWI)
iShares MSCI Spain Index Fund (EWP)

Volatility ETFs

iPath S&P 500 VIX Short-Term Futures ETN (VXX)
VelocityShares Daily 2X VIX Short-Term ETN (TVIX)

EUR/USD currency ETFs

CurrencyShares Euro Trust (FXE)
ProShares Ultra 2x Long Euro (ULE)
Market Vectors Double Long Euro ETN (URR)
ProShares Short Euro ETF ( EUFX )
Market Vectors Double Short Euro ETN (DRR)

US Treasury Bonds and German Bunds ETFs

Long Treasuries – iShares Barclays 20+ Year Treasury Bond ETF (TLT)
Short (bearish) Treasuries – ProShares UltraShort 20+ Year Treasury (TBT)
PIMCO Germany Bond Index ETF (BUND)
PowerShares DB German Bund Futures ETN (BUNL)

Gold ETFs

SPDR Gold Shares (GLD)
ProShares 2x Long Ultra Gold ETF (UGL)
PowerShares DB Gold Short ETN (DGZ)
PowerShares DB Gold Double Short ETN (DZZ)

LinkedIn versus Facebook

WSD Staff — Wed, 09 Jan 2013 15:02:09 +0000

LinkedIn announced today that it has reached 200 million members. It added an average of 6.5 million members a month in November and December 2012 and has doubled its membership since reaching 100 million members in March 2011. Meanwhile, Facebook back in October disclosed that it has passed the 1 billion users threshold.

On the surface it looks like Facebook dwarfs LinkedIn in number of users and more importantly in stock market capitalization. However, when you adjust for number of users, you realize that both companies trade at a much closer valuation per user. After rallying from under $19 a share in November to almost $30 this month, Facebook is currently trading at a near $63 billion market valuation if you use the widely used – but false – 2.17 billion share count on Yahoo Finance or $81 billion using our own calculated 2.8 billion share count. LinkedIn on the other hand trades at near $113 per share giving it a market capitalization of $12 billion.

	LinkedIn	Facebook
Market Cap ($Billion)	12	63 or 81
Users (Millions)	200	1000
MarketCap/User	$60	$63-$81

So basically, investors are valuing a Facebook user at a minimum of $63 (we think its closer to $81) and a LinkedIn user at only $60. Do you think either is reasonable?

At the time of this post no staff member at the Wall Street Dispatch had any position in Facebook or LinkedIn.

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Durable Goods, Home Prices and Few Earnings

WSD Staff — Mon, 27 Feb 2012 18:15:36 +0000

Tuesday February 28 is expected to be a quite day in terms of corporate earnings even though nearly 120 companies report their latest earnings. Most notable among those reporting are several consumer and financial services companies. In terms of economic reports, we will see possibly market moving reports on home prices, consumer confidence, and durable goods.

Notable Corporate Earnings:

Aqua America (NYSE:WTR) the water utility company, one of very few that are publicly traded, is expected to report earnings of $0.23 a share

AutoZone (NYSE:AZO) the large cap automotive parts specialty retailer is expected to report earnings of $4.04

Bank of Montreal (NYSE:BMO) the large Canadian bank is expected to report earnings of $1.38 for latest quarter

Cablevision Systems (NYSE:CVC) is expected to report earnings of $0.23 a share

Domino’s Pizza (NYSE:DPZ) the Pizza delivery company whose stock has been sizzling is expected to report earnings of $0.49 a share

Fortress Investment Group (NYSE:FIG) the global alternative investment manager is expected to report earnings of $0.12 a share

First Solar, Inc. (NASDAQ:FSLR) the once high flying solar company is expected to report $1.55 a share

Luxottica Group (NYSE:LUX) the Italian eyewear designer and distributor is expected to report earnings of $0.20

Collective Brands (NYSE:PSS) the national footwear retailer who put itself up for sale is expected to report a loss of $0.82 a share and update the status of the bids it received

Transocean (NYSE:RIG) the international offshore drilling services company is expected to report earnings of $0.21

Tenet Healthcare Corporation (NYSE:THC) the hospital operator is expected to report earnings of $0.14 a share

ViroPharma (NASDAQ:VPHM) the international biotech firm is expected to report earnings of $0.42

Warnaco Group (NYSE:WRC) the apparel and accessories designer and distributor is expected to report earnings of $0.99 a share

Economic Reports

Conference Board’s Consumer Confidence Index for February is expected to come in 62.5

Case-Shiller index is expected to decline by 3.6% for the month of December

Durable Goods Orders are expected to decline by 1.4% but increase by 0.2% if you back out the volatile transportation orders

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Warren Buffett, G20, and more Housing signals on Monday

WSD Staff — Fri, 24 Feb 2012 20:35:26 +0000

Monday’s earnings calendar will be busy with more than 120 companies reporting their latest quarterly earnings. However, events unfolding over the weekend will be much talked about on Monday and might have an impact on trading. The G20 finance ministers and central bank officials will be meeting in Mexico City. While there are several items on the agenda, expect the Euro zone debt crisis to be the most discussed. Also this weekend, the Oracle of Omaha, Warren Buffett will release his much anticipated annual letter to shareholders of his holding company Berkshire Hathaway (NYSE:BRK.A) on that company’s website on Saturday morning at 8 AM. As for economic reports, we will get data on January existing home sales on Monday.

Armstrong World Industries (NYSE:AWI) the flooring and ceiling materials manufacturers is expected to shed added light on the housing recovery when it reports earnings that are expected at $0.29 a share

Berkshire Hathaway (NYSE:BRK.A) Warrant Buffett’s mega holding company is expected to report its latest earnings on Monday but all investor’s eyes will be glued on his annual letter to shareholders which will be posted on Berkshire’s website at 8 AM Saturday morning

Career Education (NASDAQ:CECO) The for profit educational services provider that was once a high flying stock is expected to report $0.26 a share in its latest quarter

Dendreon Corporation (NASDAQ:DNDN) the biotech company is expected to report a loss of $0.23 a share for its latest quarter. However, earnings estimates, as well as the stock itself, are very volatile

Jazz Pharmaceuticals (NASDAQ:JAZZ) the midsized pharmaceuticals company is expected to report $0.60 a share

The St. Joe Company (NYSE:JOE) the timber and real estate concern that was the center of famous dueling opinions between famous investors is expected to report a slight loss for the quarter

Lowe’s Companies (NYSE:LOW) The home improvement retailer will report $0.24 a share. Its main competitor Home Depot (NYSE:HD) beat estimates earlier this week

MBIA Inc. (NYSE:MBI) Muni and structured products insurer is expected to report $0.21 a share

Priceline.com (NASDAQ:PCLN) online travel services company will add color on the health of consumer spending when they report expected earnings of $5.05 a share

SINA Corporation (NASDAQ:SINA) the Chinese internet company is expected to report $0.21 a share

Universal Health Services (NYSE:UHS) Healthcare and hospital operator is expected to report $0.91 a share

Visteon Corporation (NYSE:VC) the auto parts maker is expected to report $0.79 a share. Its competitor TRW (NYSE:TRW) beat and raised estimates this week as it saw its stock soar

VIVUS, Inc (NASDAQ:VVUS) the biotech that soared after a positive FDA recommendation is expected to report earnings of $0.11 but the bigger news is already out. Management’s color on any future secondary stock offering will be important to watch out for

On the economics calendar is the Pending Home sales index for existing homes in January.

JC Penney, Consumer Sentiment and Fed Speak

WSD Staff — Thu, 23 Feb 2012 19:33:04 +0000

The earnings and economic calendar for Friday February 24 are light but they do contain important market, and company, moving news. On the earnings front, nearly 40 companies report their latest quarterly earnings tomorrow with notable reports coming from gold miners, media companies and a major retailer. The economic calendar holds 2 important reports and public comments by 4 regional Fed Presidents. Finally, an under the radar software company with a social media twist is expected to price its IPO that may be noteworthy to watch.

Notable Corporate Earnings:

Alpha Natural Resources (NYSE:ANR) The Appalachian coal supplier is expected to report earnings of $0.26 per share.

Eldorado Gold Corporation (NYSE:EGO) This midsized international gold miner is expected to report earnings of $0.20

Endo Pharmaceuticals (NASDAQ:ENDP) Midsized biotech drug maker expected to report earnings of $1.18

Interpublic Group (NYSE:IPG) Midcap global advertising company will shed light on corporate spending on advertising and is expected to report earnings of $0.10 a share

J C Penney (NYSE:JCP) Major retailer will follow Sears Holdings tomorrow and is expected to report a loss of $0.12 a share

Newmont Mining (NYSE:NEM) The large cap international gold producer is expected to report glittery earnings of $1.24 a share

E. W. Scripps Company (NYSE:SSP) Media company that owns local TV and newspapers in the US is expected to report earnings of $0.10 a share

Washington Post Company (NYSE:WPO) what is now considered a midcap media company (market cap $3 Billion) is expected to report earnings of $5.36 a share

Economic Reports

January New Home Sales are expected to come in at 315,000 – an increase from the prior month’s 307,000

University of Michigan Consumer Sentiment for February – the final reading – is expected to come in at 73.

Finally, 4 regional Federal Reserve Presidents will be making public comments tomorrow. They are St. Louis Federal Reserve Bank President James Bullard, San Francisco Federal Reserve Bank President John Williams, New York Federal Reserve Bank President William Dudley, and Philadelphia Federal Reserve Bank President Charles Plosser.

IPOs

BAZAARVOICE INC (NASDAQ:BV) is expected to price its IPO on Friday offering 9.5 million shares at an expected range of $8-$10 a share. In its own words, “Bazaarvoice is a Software as a Service (SaaS) company that enables the world’s biggest brands to capture, analyze, and most importantly, act upon social data – to drive true, customer-centric change”

PROTO LABS INC (NYSE:PRLB) Manufacturer of custom parts for prototyping and short-run production is expected to sell 4.3 Million shares at $13-$15 a share

ROI ACQUISITION CORP (NASDAQ:ROIQU) a blank check company focusing on restaurant industry is expected to sell 9.4 million shares at $10 a share

GM, PPI, and Housing Starts are what to watch for tomorrow

WSD Staff — Wed, 15 Feb 2012 19:37:25 +0000

Thursday February 16 is another busy day in terms of corporate earnings and economic reports. On the economic reports front, tomorrow will see the release of Housing, Jobs, and Inflation related reports. On the corporate front, more than 130 companies will report with General Motors (NYSE:GM) being the mostly widely anticipated.

Economic Reports:

The Philadelphia Fed Index will be released and is expected to show an increase in regional economic activity in February. Index reading is expected to come in at 10.

Producer Price Index, PPI, for January is expected to come in at 0.3% with core PPI coming in at 0.2%.
Building Permits are expected to come in at 675,000 for January, slightly lower than the 679,000 in December.

January Housing Starts are expected to come in at 671,000 – above the 657,000 in December.

Initial Unemployment Claims for the week ending February 11 are expected to be 365,000 – slightly higher than 358,000 the previous week.

Companies reporting:

Applied Materials Inc (NASDAQ:AMAT) – Large semiconductor company expected to report earnings of $0.12 a share

Baidu Inc (NASDAQ:BIDU) – Dubbed as the Chinese Google is expected to report earnings of $0.91

Discovery Communications (NASDAQ:DISCA) – Midsized niche media company expected to report $0.69

Demand Media Inc (NYSE:DMD) – Online media publisher that will provide insights into the health of online advertising and monetization is expected to report $0.07 a share

DirecTv (NASDAQ:DTV) – Satelite TV behemoth is expected to announce earnings of $0.92

Duke Energy Corp (NYSE:DUK) – Large Utility company expected to report $0.21 a share

General Motors Co (NYSE:GM) – Perhaps the most anticipated report tomorrow, GM is expected to shed light on the state of US manufacturing as well as the health of the US consumer. Expectations are for $0.41 a share.

Hyatt Hotels Corp (NYSE:H) – Large international hotel operator expected to report $0.13

Nordstrom Inc (NYSE:JWN) – Upscale department store operator is expected to announce $1.10

Leap Wireless International Inc (NASDAQ:LEAP) – Small prepaid wireless services provider and often cited
takeover target is expected to announce a loss of $1.11

Spirit Airlines (NASDAQ:SAVE) – Discount Airline is expected to announce earnings of $0.32

J. M. Smucker Co (NYSE:SJM) – Large food products maker expected to announce earnings of $1.41

SunPower Corp (NASDAQ:SPWR) – Solar energy company and former market darling will announce how bad the
solar industry is as it is expected to announce a loss of $0.05

Strayer Education Inc (NASDAQ:STRA) – For-profit education provider is expected to announce earnings of $2.26

Share with us in the comments sections below what are you looking ahead for tomorrow?

What to look for on February 15

WSD Staff — Tue, 14 Feb 2012 18:18:43 +0000

There are more than 130 companies reporting earnings on Wednesday February 15. In addition, there are 8 economic reports/ indicators being released.

Among the more interesting earnings reportS to look out for are a bunch in the technology, media, and consumer sectors below:

Abercrombie & Fitch (NYSE:ANF) – Relevant in light of lower than expected January retail sales announced today. Estimates call for $1.12

Avis Budget Group Inc (NYSE:CAR) – Good insights into consumer spending. Estimates call for $0.06

CBS Corp (NYSE:CBS) – Insights into media and advertising spending. Estimates are $0.53

Comcast Corp (NASDAQ:CMCSA) – Same as CBS above. Estimates are $0.41

Deere & Co (NYSE:DE) – Color on global growth. Estimates are $1.23

Hanesbrands Inc (NYSE:HBI) – Insights into the consumer. Estimates are for $0.51

Marriott International Inc (NYSE:MAR) – Same as Avis above. Estimates are $0.47

Blue Nile Inc (NASDAQ:NILE) – Niche online luxury retailer. Estimates call for $0.42

MEMC Electronic Materials, Inc. (NYSE:WFR) – Insights into the state of the Solar Energy industry from a previous high flier in that space. Estimates call for a loss of $0.06

Zillow Inc (NASDAQ:Z) – Look into the Real Estate business from this online real estate services company. Estimates call for $0.01

Among the most anticipated economic reports will be:

-FOMC minutes from the January 25 meeting

-Crude Inventories

-January Capacity Utilization which is expected to come in at 78.6%

-January Industrial Production – expected at 0.6%

-February Empire Manufacturing – expected at 14

Tell us what are you looking ahead for tomorrow?