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Technical Trade Alerts on Recent Analyst Upgrade Notables: ZZ, CLI, KMB, SYMC, SCI, SWY for Oct. 9
10/13/08
ticker(s):
ZZ,
CLI,
KMB,
SYMC,
SCI,
sector(s):
Thursday October 09 2008
Today’s Trade Alerts include: Sealy Corp. (NYSE: ZZ: Summary, Messages, Articles), Mack-Cali Realty Corp. (NYSE: CLI: Summary, Messages, Articles), Kimberly-Clark Corp. (NYSE: KMB: Summary, Messages, Articles), Symantec Corp. (Nasdaq: SYMC: Summary, Messages, Articles), Service Corp. International (NYSE: SCI: Summary, Messages, Articles) and Safeway Stores Inc. (NYSE:SWY: Summary, Messages, Articles).
Sealy Corporation (ZZ: Summary, Messages, Articles) Trade Alert – ZZ Receives Analyst Upgrade to Outperform, Reports Q3 Financial Results
Sealy Corporation (ZZ: Summary, Messages, Articles) shares rose 1% to $4.09 Thursday morning. Sealy engages in the manufacture and marketing of a line of bedding products in the United States and internationally. Raymond James recently upgraded Sealy from Market Perform to Outperform. This new rating expects the stock to appreciate and outperform the S&P 500 over the next 12 months.
Sealy also recently announced results for its third quarter of fiscal 2008. Net income for the third quarter was $10.9 million or 12 cents per diluted share versus $21.5 million or 22 cents per diluted share for the comparable period last year. Total domestic net sales for the third quarter of 2008 were $296.1 million compared to $335.1 million in the third quarter of 2007.
The company said third quarter profit halved, but beat market estimates on its cost-cutting efforts and a recently launched bedding line. Sealy, which cut its promotional expenses, salary and fringe-benefit-related costs, and spending on professional services and other discretionary items, said selling, general, and administrative expenses fell 5% to $132.9 million in the quarter.
Sealy offers mattresses and mattress foundations. The company's innerspring bedding products are sold under Sealy, Sealy Posturepedic, Stearns & Foster, and Bassett brand names.
It also manufactures and markets visco-elastic and latex bedding products under the TrueForm, SpringFree, Stearns & Foster, Reflexions, Carrington Chase, MirrorForm, and Pirelli brands.
It serves various outlets, including furniture stores, specialty bedding stores, department stores, and warehouse club stores.
In today's daily chart, ZZ's Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
Mack-Cali Realty Corporation (CLI: Summary, Messages, Articles) Trade Alert – CLI Gets New Nine-year Lease from Forest Research Institute, Receives Analyst Upgrade
Mack-Cali Realty Corporation (CLI: Summary, Messages, Articles) shares rose 1.68% Thursday morning, trading at $27.24. Mack-Cali is a real estate investment trust (REIT). It engages in the leasing, management, acquisition, development and construction of commercial real estate properties in the United States.
UBS recently upgraded Mack-Cali Realty from Sell to Neutral with a price target of $27. This new rating suggests the stock is fairly valued and there is no compelling reason to buy or sell the stock today; it is cautious about short-term prospects for industry/company.
The company also announced that Forest Research Institute Inc., a subsidiary of Forest Laboratories Inc., has signed a new nine-year, 35,587 square-foot lease at Harborside Financial Center Plaza 5 in Jersey City, New Jersey. The firm now leases a total of 215,659 square feet at the 977,225 square-foot class A office building, with all of its leases expiring concurrently. Coincident with the new lease, Forest Research is surrendering 22,785 square feet of space at Harborside Financial Center Plaza 3, which would have expired in approximately 18 months.
The company also announced its board of directors has declared a cash dividend of 64 cents per common share (indicating an annual rate of $2.56 per common share) for the period July 1, 2008, through September 30, 2008. The dividend will be paid October 10, 2008, to shareholders of record as of October 3, 2008.
Mack-Cali invests in the real estate markets of the United States primarily in the northeastern United States, as well as in the District of Columbia.
It primarily invests in office and office/flex buildings, totaling approximately 30.0 million square feet, and developable land.
The firm's properties also include industrial/warehouse buildings, retail properties, a hotel and parcels of land leased.
In today's daily chart, CLI's Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
Kimberly-Clark Corporation (KMB: Summary, Messages, Articles) Trade Alert – Morgan Stanley Upgrades KMB from Underweight to Equalweight
Kimberly-Clark Corporation (KMB: Summary, Messages, Articles) shares slipped .21% Thursday morning, trading at $61.83. Kimberly-Clark engages in the manufacture and marketing of health and hygiene products worldwide. Morgan Stanley recently upgraded Kimberly-Clark from Underweight to Equalweight.
This new rating suggests the stock's total return is expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12 to 18 months.
Kimberly-Clark also reported that for the second year in a row it received an Environmental Excellence Award from the U.S. Environmental Protection Agency SmartWay(SM) Transportation Partnership for its leadership in conserving energy and lowering greenhouse gas emissions.
Kimberly-Clark's 2007 SmartWay action plan included investing in a strategy to locate distribution centers near large cities, implementing a new transportation management system and collaborating with internal and external supply chain partners. As a result, the company reduced its usage of diesel fuel by 1.7 million gallons and decreased carbon dioxide emissions by 113,728 tons, which is the equivalent of removing over 15,000 cars from the road.
The company operates in four segments: Personal Care, Consumer Tissue, K-C Professional & Other, and Health Care. The Personal Care segment manufactures and markets disposable diapers, training and youth pants, and swim pants; baby wipes; feminine and incontinence care products; and related products. This segment offers its products primarily for household use under various brand names, including Huggies, Pull-Ups, Little Swimmers, GoodNites, Kotex, Lightdays, Depend, Poise and other brand names.
The Consumer Tissue segment manufactures and markets facial and bathroom tissue, paper towels, napkins, and related products for household use under the Kleenex, Scott, Cottonelle, Viva, Andrex, Scottex, Hakle and Page brand names.
The K-C Professional & Other segment manufactures and markets facial and bathroom tissue, paper towels, napkins, wipers, and a range of safety products for the away-from-home marketplace under the Kimberly-Clark, Kleenex, Scott, WypAll, Kimtech, KleenGuard and Kimcare brand names.
The Health Care segment manufactures and markets disposable health care products, such as surgical gowns, drapes, infection control products, sterilization wraps, face masks, exam gloves, respiratory products and other disposable medical products under the Kimberly-Clark and Ballard brand names.
Products for household use are sold directly, and through wholesalers, to supermarkets, mass merchandisers, drugstores, warehouse clubs, variety and department stores, and other retail outlets.
Products for away-from-home use are sold through distributors and directly to manufacturing, lodging, office building, food service, health care establishments and high volume public facilities.
In today's daily chart, KMB's MACD reflects a weak bearish signal, with the indicator above the critical 0 level but crossing below its 9-day moving average signal line, indicating bullish moving averages but slowing positive momentum. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
Symantec Corporation (SYMC: Summary, Messages, Articles) Trade Alert – SYMC Receives Analyst Upgrade to Overweight, Agrees to Acquire MessageLabs Ltd.
Shares of Symantec Corporation (SYMC: Summary, Messages, Articles) climbed 1.36% to $14.90 Thursday mid-morning. Symantec provides software and services that protect, manage, and control information risks related to security, data protection, storage, compliance and systems management.
J.P. Morgan recently upgraded Symantec from Neutral to Overweight, citing the stock's low valuation, shortly before Symantec opened up its wallet to acquire online-messaging firm MessageLabs Ltd. An overweight rating expects the stock to outperform average total return of stocks in analyst's or analyst's team's coverage universe over the next six to 12 months.
J.P. Morgan analyst John DiFucci wrote in a note to clients that Symantec's stock price currently only reflects a fraction of its value.
As written by DiFucci, "We are upgrading shares of Symantec ... as the shares have fallen to a value less than what we believe the maintenance is worth, and investors are essentially getting the consumer business and any future enterprise license for free."
Symantec also announced it agreed to acquire MessageLabs Ltd. for about $695 million in cash, the latest sign that large security-software companies are exploiting the current downturn to pick up smaller players at attractive prices. MessageLabs makes online anti-spam software, which blocks unsolicited junk e-mails.
Symantec is best known for software, like its Norton line of products, which protect against viruses and other programs that cyber criminals use to hijack computers and steal information.
The company operates in four segments: Consumer Products, Security and Compliance, Storage and Server Management, and Services. The Consumer Products segment focuses on delivering the company's Internet security, personal computer (PC) tuneup, and backup products to individual users and home offices.
The Security and Compliance segment provides solutions for compliance and security management, endpoint security, messaging management, and data protection management software solutions that enable businesses to secure, provide, backup, and remotely access their laptops, PCs, mobile devices and servers.
The Storage and Server Management segment offers storage and server management, data protection and application performance management solutions across heterogeneous storage and server platforms to enterprises.
The Services segment provides information technology risk management services and solutions to manage security, availability, performance, and compliance risks across multi-vendor environments. It also offers managed security services, consulting, education and threat and early warning systems.
The company offers its services to enterprises, governments, small and medium-sized businesses, and consumers worldwide.
In today's daily chart, SYMC's Bollinger Bands indicate above normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
Service Corporation International (SCI: Summary, Messages, Articles) Trade Alert – Raymond James Upgrades SCI from Outperform to Strong Buy
Service Corporation International (SCI: Summary, Messages, Articles) shares slipped 1.60% Thursday morning, trading at $7.39. Service Corp. operates as a deathcare products and services provider. Its funeral service and cemetery operations consist of funeral service locations, cemeteries, funeral service/cemetery combination locations, crematoria and related businesses.
Raymond James recently upgraded Service Corp. from Outperform to Strong Buy. This new rating expects the stock to appreciate and produce a total return of at least 15% and outperform the S&P 500 over the next six months.
The company recently said it had withdrawn its $1.5 billion cash offer to acquire smaller rival Stewart Enterprises Inc. In a letter filed with the Securities and Exchange Commission, the company said it rejected Stewart's demands that Service Corp. finance the entire deal, assume all responsibility and risk for gaining regulatory approval and raise its $11-per-share offer for Stewart.
Service Corp. owns 1,300 funeral homes and 350 cemeteries in the United States, Canada and Puerto Rico. Stewart owns 221 funeral homes and 139 cemeteries in the United States and Puerto Rico. In 2006, Service Corp. paid $1.2 billion to acquire Alderwoods Group, another major chain.
Service Corp. provides various professional services relating to funerals and cremations, including the use of funeral facilities and motor vehicles, and preparation and embalming services.
It also sells funeral related merchandise, including caskets, burial vaults, cremation receptacles, flowers and other ancillary products and services at funeral service locations. Its cemeteries provide cemetery property interment rights, including mausoleum spaces, lots, and lawn crypts, and sell cemetery related merchandise and services, including stone and bronze memorials, burial vaults, casket and cremation memorialization products, merchandise installations, and burial openings and closings.
The company also sells preneed funeral and cemetery preneed products and services whereby a customer contractually agrees to the terms of certain products and services to be delivered and performed in the future.
As of December 31, 2007, Service Corp. operated 1,342 funeral service locations and 366 cemeteries (including 207 combination locations) covering 43 states in the United States, eight Canadian provinces, the District of Columbia, Puerto Rico, and Germany.
In today's daily chart, SCI's Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
Safeway Inc. (SWY: Summary, Messages, Articles) Trade Alert – SWY Receives Analyst Upgrade, Announces Higher Q3 Profit
Safeway Inc. (SWY: Summary, Messages, Articles) shares slightly climbed Thursday mid-morning, trading at $23.69. Safeway, together with its subsidiaries, operates as a food and drug retailer in North America.
Jefferies & Co. recently upgraded Safeway from Underperform to Hold. This new rating expects the stock to change plus or minus 10%, with stock's total return expected to be in line with the average total return of the analyst's industry coverage universe, on a risk-adjusted basis, over the next 12 months.
Jefferies & Co. analyst Scott Mushkin upgraded Safeway to a Hold rating from Underperform, saying in a research note that the market appears to be "appropriately discounting (Safeway's) pricing issues and sluggish sales trends." He said he saw few negative catalysts in the months ahead to hurt the company outside macroeconomic pressures.
Deborah Weinswig at Citigroup Global Markets also said in a note that the company's ability to offset a weak sales environment with cost-cutting is impressive, but also counseled waiting on the sidelines due to pressures from weakness in the economy and inflation.
Safeway also recently announced profit rose nearly 3% in its third fiscal quarter, with help from higher sales at its gas stations and upscale stores. For the quarter ended September 6, net income was $199.7 million, or 46 cents a share, compared with net income of $194.6 million, or 46 cents a share, in the year-earlier quarter. Analysts polled by FactSet Research had expected Safeway to earn 48 cents a share. Revenue for the third quarter also rose 4%.
The company expects 2008 profit to at least match Wall Street expectations. It confirmed its expectation for the year, which is a 53-week year for the company, of earnings of $2.25 to $2.35 per share.
Safeway operates stores that provide an array of dry grocery items, food, and general merchandise, as well as features specialty departments, such as bakery, delicatessen, floral and pharmacy, as well as coffee shops and fuel centers.
It also offers SELECT line of products that include salsas, bagged salads, whole bean coffees, cookies, frozen pizzas, fresh and frozen pastas, and an array of ice creams and hors d'oeuvres; O ORGANICS line, which comprises milk, chicken, salads, juices, entrees, and others; Eating Right line of better-for-you products; Priority Total Pet Care line of pet foods and pet care products; Basic Red value-priced paper goods; and Lucerne line of dairy products and the Primo Taglio line of meats and cheeses.
As of December 29, 2007, Safeway operated approximately 1,743 stores in California, Oregon, Washington, Alaska, Colorado, Arizona, Texas, the Chicago metropolitan area, and the Mid-Atlantic region, as well as British Columbia, Alberta, and Manitoba/Saskatchewan.
The company also owns and operates GroceryWorks.com Operating Company LLC, an online grocery channel, doing business under the names Safeway.com, Vons.com, and Genuardis.com; and Blackhawk Network Holdings Inc., which provides third-party gift cards, prepaid cards, telecom cards, and sports and entertainment cards to North American retailers for sale to retail customers.
It also engages in gift card businesses in the United Kingdom and Australia, and through 49% ownership interest in Casa Ley S.A. de C.V. operates 137 food and general merchandise stores in Western Mexico.
In today's daily chart, SWY's MACD reflects a strong bearish signal, with the indicator below the 9-day moving average signal line, and also below the critical 0 level, indicating that moving averages are trending lower. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. With share prices currently below the stock's 13-day moving average, the bearish signal is more pronounced with decreasing moving averages.
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Today
| Stocks | Searches Today | ||
|---|---|---|---|
| ZZ | (SEALY CORPORATION) | Summary Messages Articles | 0 (new!) |
| CLI | (MACK-CALI REALTY) | Summary Messages Articles | 0 (new!) |
| KMB | (KIMBERLY CLARK CP) | Summary Messages Articles | 0 (new!) |
| SYMC | (SYMANTEC CP) | Summary Messages Articles | 0 (new!) |
| SCI | (SERVICE CP INTL) | Summary Messages Articles | 0 (new!) |
| SWY | (SAFEWAY STORES IN) | Summary Messages Articles | 0 (new!) |
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