Stock Talk June 16
June 16, 2009
Alert: Stock Talk looks at Koss Corp (KOSS), 99 Cents Only Stores (NDN), Qualcomm Inc (QCOM), and Spartech Corp (SEH) for the 1st time.
Recap of Monday’s US Stock Market Action US stocks headed South on Monday on low volume in what many savvy market observers view ad "unsurprising" after the strong three month rally and the bounce in the US$. The DJIA lost 187.13 pts (2.13%) to close at 8,612.13, the S&P 500 shed 22.49 pts (2.38%) to close at 923.72, the NAS closed minus 42.42 pts (2.28%) at 1,816.38, and the Russell 2000 index of smaller companies fell 15 pts (2.9 %) and closed at 511.83 on the day. The CBOE Volatility Index .Wall Street's fear gauge, closed above the 30 level for the first time since early June, suggesting more turmoil may be on the horizon. The VIX jumped 9.5 percent to end at 30.81. Note: If traders were bored with the stock market’s lack of direction over the last week, the next four sessions are likely to deliver more excitement and volatility thanks to Quadruple Witching Friday. Yes, this Friday represents not only options expiration, which usually indicates more volatility than usual, but it is also the second quadruple witching day this year. Quadruple witching occurs when contracts for stock index futures, stock index options, stock options and single stock futures all expire. This can lead to dramatic moves in the equity markets up or down. I make it a point never to trade in this atmosphere. The market is overbought in here, so it will be interesting to see if the expiration leans to the side of more buying or selling. Again, I do not trade ahead or immediately after a major Witching event. Crude Oil prices fell from nearly an eight-month high after Russia expressed confidence in the US$ as the world's reserve currency, increasing the greenback's safe-haven appeal. Gains in the US$ makes Crude Oil more expensive for holders of other currencies. Volume and Breadth: volume was light on Monday, as it has been for several weeks now, indicating fewer traders are standing behind the market's action. Volume does tend to slow in the summer as traders take vacations, but thin volume may also indicate there is less conviction. About eight stocks fell for every one that rose on the NYSE, where volume came to a light 4.55B/shrs, up from Friday's 4.39B/shrs. Stocks to Watch Today ChevronTexaco Corporation (CVX), Ford Motor Company (F), Koss Corp (KOSS), 99 Cents Only Stores (NDN), Oracle Corp. (ORCL), Qualcomm Inc (QCOM), Spartech Corp (SEH), Wal-Mart Stores, Inc. (WMT), and United Technologies Corporation (UTX).
ChevronTexaco Corporation (CVX) Up-date 8 June 16, 2009 Paul A. Ebeling, Jr. Analyst Today let’s have a look at ChevronTexaco Corporation (CVX), the US Oil Giant, from a Technical POV. The overall analysis after Monday’s (June15, 2009) market action is Neutral: in the near term Neutral, mid-term Bullish, and long term Neutral.
**Chart by: http://www.stockta.com
Latest News: Stocks Put In a Down Day http://www.thestreet.com/_yahoo/story/10515242/1/stocks-sink-with-oil-dollar-rises.html? cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA Mondayâ€™s Market Action Close 71.80
There a Gap open up on June 1, 2009 at 66.94/67.44, the near term resistance is 73.60, support at 70.60, and the 50 day (EMA) exponential moving average is 67.93. This is ChevronTexaco Corporation (CVX): Texaco's star and its Chevron stripes allow this US Oil Giant to have market clout. It is the 2nd largest US integrated oil company behind Exxon Mobil and has proved reserves of 10.8 B bbls of crude oil equivalent and a daily production of 2.6 MM bbls of crude oil equivalent, and it also owns interests in chemicals, pipelines, and power production businesses. The company, which is restructuring its refinery and retail businesses, owns or has stakes in 9,700 gas
stations in the US which operate under the Chevron and Texaco brands. Outside the US it owns or has stakes in 15,400 gas stations, which also use the Caltex brand. The Competitive Landscape Demand is driven by federal legislation and regulations that establish a government-mandated market for bio-fuels. The profitability of bio-fuel production facilities depends on prices of gas and diesel, which fluctuate based on world petroleum demand and domestic refinery utilization. Economies of scale in ethanol production are limited due to the transportation costs associated with gathering feed stocks (corn and other biomasses) and transporting the ethanol to blending sites. As a result, large companies operate multiple production facilities. Small companies can compete effectively by developing business relations with distributors and being able to assure delivery consistently. Revenue per employee in ethanol production facilities is about US$1MMper year.
Industries Where Chevron Competes Energy & Utilities Oil & Gas Refining, Marketing & Distribution Alternative Energy Sources Chemicals Financial Services Retail
ChevronTexaco Corporation (HQ) Chairman and CEO David J. (Dave) O'Reilly 6001 Bollinger Canyon Rd. San Ramon, CA 94583 United States Phone: 925-842-1000 Fax: 925-842-3530 http://www.chevron.com
Chevron Subsidiaries Bridgeline Holdings, L.P. Caltex Australia Limited Chevron Mining Inc.
Ford Motor Company (F) Up-date 5 June 16, 2009 Paul A. Ebeling, Jr. Analyst
Today let’s look at Ford Motor Company (F), one of the World’s leading carmakers, from a Technical POV. The overall analysis after Monday’s (June 15, 2009) market action is Neutral: in the near term Neutral, mid-term Bullish, and long term Bullish.
**Chart by: http://www.stockta.com
Latest News: Ford happy to take its own route http://www.ft.com/cms/s/0/4049878a-59d5-11de-b687-00144feabdc0.html? referrer_id=yahoofinance&ft_ref=yahoo1&segid=03058 Monday’s Market Action
There is a Bullish Harami on June 9 and four Gaps open up between Apr 2 and May 14, 2009 at 2.80/4.99: the near term resistance is at 6.05, support at 5.39, and the 50 day exponential moving average is 5.15.
This is Ford Motor Company: Henry Ford began the US manufacturing revolution with his innovative mass production assembly lines in the early 1900s. The company is now a brand known around the world and firmly thought of by consumers as one of the world's largest makers of cars and trucks. FoMoCo’s brands include: Ford, Lincoln, and Mercury. Among its biggest current successes are the re-designed Ford Mustang and F-Series pickup. Ford owns a small stake in Mazda and also controls Volvo. The Company’s Finance subsidiary Ford Motor Credit is one of the US's leading auto finance companies. After clearing all of the antitrust and labor hurdles, Ford recently sold its Euro Luxury brands Land Rover and Jaguar to India-based Tata Motors for about US$2.3B in 2008. Ford is ranked #7 in FORTUNE 500 The Competitive Landscape Ford Motor Company’s competition is the world automaker industry. The Top Ford Motor Competitors are, Chrysler, General Motors, and Toyota US auto demand is driven by employment and interest rates. The profitability of individual companies depends on manufacturing quality, efficiency, and marketing. The large carmakers produce multiple product lines that are marketed under different brand names. The smaller companies manufacture a fewer or single branded product lines. The large companies have the advantage of economy of scale, whereas the smaller companies compete by focusing on specialized markets. Due to highly automated manufacturing processes, the average annual revenue per employee is about US$1.4MM. Auto Manufacture Industry Forecast The output of US motor vehicles manufacturing is forecast to grow at an annual compounded rate of 8 % between 2008 and 2013. Ford Motor Company (HQ) Chairman William Clay (Bill) Ford Jr. President, CEO, and Director Alan R. Mulally 1 American Rd. Dearborn, MI 48126-2798 United States Phone: 313-322-3000 Fax: 313-845-6073 Toll Free: 800-555-5259 http://www.ford.com
Ford Motor Subsidiaries AutoAlliance International, Inc. Changan Ford Mazda Automobile Corporation, Ltd. Ford Division
Koss Corp June 16, 2009
Paul A. Ebeling, Jr. Analyst Today let’s look at Koss Corp (KOSS), a retailer of stereo headphones and related accessory products, from a Technical POV. The overall analysis after Monday’s (June 15, 2009) market action is Neutral, in the near term Neutral, mid-term Bullish, and long term Neutral.
**Chart by: http://www.stockta.com Latest News: 10-Q: Koss Corp Review http://www.marketwatch.com/story/10-q-koss-corp-2009581238160 Monday’s Market Action Close
On June 3 there a Bearish Harami finished development, June 5 an Inverted Hammer completed development, and June 10 a Hammer. Two of the recent Gaps for this stock were: June 2, 2009 12/12.25 and June 10th 12.25/12.35. Near-term resistance for this stock is 14.44, and near term support is 13.22. The 50 day exponential moving average is rising to 13.25.
This is Koss Corp (KOSS): operates in the audio/video industry segment of the home entertainment industry through its design, manufacture and sale of stereo headphones and related accessory products. The Company's products are sold through audio specialty stores, the Internet, direct mail catalogs, regional department store chains, discount department stores, military exchanges, prisons, and national retailers under the Koss name and dual label. Koss Corporation also sells products to distributors for resale to school systems, and directly to other manufactures for inclusion with their own products. The Company has more than 300 domestic dealers and its products are carried in approximately 13,400 domestic retail outlets. Koss Corporation's subsidiaries include Bi-Audio and Koss Classics. The corporation has no debt to speak of. Competitive Landscape Consumer electronics sector has been profoundly affected by globalization and technological changes of the last two decades. Manufacturing of many consumer electronics has typically moved outside of the US. However, US employment in industries supplying content and services has risen. It can be inferred that the US is becoming an exporter to a larger extent in content and services and this trend will continue in the long-term. Koss Corp (HQ) Chairman and Chief Director: John C Koss 4129 N. Port Washington Ave. Milwaukee, WI 53212 United States Phone: 414-964-5000 Fax: 414-964-8615 http://www.koss.com
Oracle Corp. (ORCL) Up-date 4 June 16, 2009 Paul A. Ebeling, Jr. Analyst
Today let’s look at Oracle Corp. (ORCL), the Giant enterprise software company, from a Technical POV. The overall analysis after Monday’s (June 15, 2009) market action is Neutral; in the near term Neutral, mid-term Neutral, and long term Bullish.
**Chart by: http://www.stockta.com Latest News: Top NYSE Short-Squeeze Plays http://www.thestreet.com/_yahoo/story/10515661/1/top-nyse-short-squeeze-plays.html? cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA Monday’s Market Action Close 20.22
There is Bearish Harami on June 12 and two Gap open up between Mar 19 & 31, 2009 at 16.09/17.82, the near term resistance is 20.92, support at 19.89, and the 50 day (EMA) exponential moving average is 19.27. This is Oracle Corp. (ORCL): Oracle is an enterprise software company, engages in the development, manufacture, distribution, servicing, and marketing of database, middleware, and application software worldwide. The company’s New Software Licenses segment provides licenses for database and
middleware software, including database management software, application server software, business intelligence software, identification and access management software, analytics software, content management software, development tools, and data integration software; and applications software that offers enterprise information for customer relationship management, financials, insurance, human resources, maintenance management, manufacturing, marketing, order fulfillment, product lifecycle management, procurement, projects, sales, services, enterprise resource planning, and supply chain planning sectors. It’s Software License Updates and Products Support segment offers customers with rights to unspecified software product upgrades and maintenance releases, and Internet access to technical content, as well as Internet and telephone access to technical support personnel. The company’s Consulting segment designs, implements, deploys, and upgrades database, middleware, and applications software. Its On Demand segment provides multi-featured software and hardware management, and maintenance services for clients deploying its software products; and support centers, assistance, technical account management, configuration and performance analysis, personalized support, annual on-site technical services, and other related services. The company’s Education segment offers online courses and self paced media training on CD-ROMs. It distributes its products and services to resellers, system integrators/implementers, consultants, education providers, Internet service providers, network integrators, and independent software vendors. Competitive Landscape The US economy heavily influences business spending for software products. The success of programming companies depends heavily on strong technical expertise. The success of packagedsoftware companies depends on technical expertise and good marketing. Small software companies compete mainly by developing packaged products in small niches or producing custom products for individuals. Many small companies form alliances with larger ones to market their products. Computer Software Development Industry Forecast The output of US software publishers is forecast to grow at an annual compounded rate of 6 % between 2008 and 2013. Data Sourced: December 2008 Oracle Corp. (HQ) Co-Founder, Chief Exec. Officer: Lawrence J. Ellison 500 Oracle Parkway Redwood Shores, CA 94065 United States Phone: 650-506-7000 Fax: 650-506-7200 http://www.oracle.com
Oracle Subsidiaries Crystal Ball i-flex Solutions Limited Oracle Corporation Canada Inc.
Qualcomm Inc (QCOM) June 16, 2009 Paul A. Ebeling, Jr. Analyst
Today, let’s look at Qualcomm Inc (QCOM), one of US’s oldest and largest manufacturers of digital wireless and services, from a Technical POV. The overall analysis after Monday’s (June 15, 2009) market action is Neutral: in the near term Neutral, mid-term Neutral, and long term Bullish.
**Chart by: http://www.stockta.com Latest News: Qualcomm Raises Outlook on Demand for Wireless Broadband http://online.wsj.com/article/SB124473385683906509.html?ru=MKTW#mod=MKTW Monday’s Market Action Close 44.31
On June 12, 2009 a Bearish Doji Star was completed. There are no gaps for this stock (very liquid). Near term resistance is 45.95 and near term support is at 43.95. The 50 day exponential moving average is moving up to 42.34. This is Qualcomm (QCOM): incorporated in 1985, designs, manufactures and markets digital wireless telecommunications products and services based on its code division multiple access (CDMA) technology and other technologies. The Company operates through four segments: Qualcomm CDMA Technologies
(QCT); Qualcomm Technology Licensing (QTL); Qualcomm Wireless & Internet (QWI), and Qualcomm Strategic Initiatives (QSI). QCT is a developer and supplier of integrated circuits and system software for wireless voice and data communications, multimedia functions and global positioning. QTL grants licenses to use portions of its intellectual property portfolio, which includes certain patent rights essential to and/or useful in the manufacture and sale of CDMA products. In December 2007, the Company acquired San SoftMax Inc. In March 2008, the Company acquired Xiam Technologies Limited (Xiam), an Ireland-based provider of wireless content targeting solutions. The Competitive Landscape Telecom market growth is leveraged on capital expenditures from large corporations. The industry has adopted a more cautious approach with regard to over expanding due to improvements forecasting demand in the sector and saturation. However, a bright spot for the industry is that service operators cannot prolong spending on equipment to expand network bandwidth because of the risk of disrupting business operations. Large cash stores in corporate coffers that are typically seen in this industry are used for purchases and acquisitions of smaller competitors. Communications and Equipment Index Performance Year to date, through May 15, the S&P Communications Equipment Index increased 15.3%, versus a 2.1% decrease for the S%P 1500. During 2008, the index declined 40.8%, compared to 38.2% drop for the S&P 1500. Qualcomm Corp (HQ) Chairman & Chief Exec. Paul E Jacob 5775 Morehouse Dr. San Diego, CA 92121 United States Phone: 858-587-1121 Fax: 858-458-9096 http://www.qualcomm.com
Spartech Corp (SEH) June 16, 2009 Paul A. Ebeling, Jr. Analyst Today, letâ€™s look at Spartech Corp (SEH), the company that makes ordinary plastic and makes it special, from a Technical POV. The overall analysis after Mondayâ€™s (June 15, 2009) market action is Bullish: in the near term Bullish, mid-term Very Bullish and long term Bullish.
**Chart by: http://www.stockta.com Latest News: 10-Q Overview for Spartech Corp http://www.marketwatch.com/story/10-q-spartech-corp-20096101722120 Mondayâ€™s Market Action Close 8.06
On June 15, 2009 a DOJI pattern completed and there is one Gap up on June 11, 2009 at 6.11/6.40. The near term resistance NIL, the near term support is lightly holding at 7.29. The 50 day moving average is 4.75. This is Spartech Corp (SEH): is an intermediary processor of engineered thermoplastics. The Company converts base polymers or resins purchased from commodity suppliers into extruded plastic sheet and rollstock, thermoformed packaging, specialty film laminates, acrylic products, specialty plastic alloys, color concentrates and blended resin compounds, and injection molded and profile extruded products. Spartech is organized into three reportable segments and one group of operating segments based on the products. The three segments are Custom Sheet and Rollstock, Packaging Technologies and Color and Specialty Compounds, with the remaining businesses grouped together in Engineered Products. The
consolidated net sales by segment and group for the fiscal year ended November 1, 2008 (fiscal 2008), were Custom Sheet and Rollstock (45%), Packaging Technologies (20%), Color and Specialty Compounds (30%), and Engineered Products (5%). Competitive Landscape Chemical industry is comprised of companies that produce commodity chemicals, diversified chemicals, fertilizers and agricultural chemicals, industrial gases, and specialty chemicals. Large manufactures benefit from supply chain integration and economies of scale, whereas smaller manufacturers utilize product specialization and efficient operations in order to compete. Demand for industry goods is cyclical and requires capital intensive investments that do not generate returns immediately. As a result, successful companies are usually those that manage cost of capital and returns on investment. Global Demand Figures Global annual plastics consumption is in excess of 180 million metric tons. Total world plastic consumption is expected to double by 2015 from 2003 levels. Annual demand is expected to grow at more than 5%. Spartech Corp (HQ) Chairman and Director: Ralph B Andy 120 S. Central Ave Clayton, MO 63105 United States Phone: 314-721-4242 Fax: 314-721-1447 http://www.spartech.com
United Technologies Corporation (UTX) Up-date 1 June 16, 2009 Paul A. Ebeling, Jr. Analyst Today, letâ€™s look at United Technologies Corporation (UTX), the US aerospace products manufacturer, from a Technical POV. The overall analysis after Mondayâ€™s (June 15, 2009) market action is Bullish: in the near term Bullish, mid-term, Very Bullish, and long term Bullish.
**Chart by: http://www.stockta.com Latest News: Pratt & Whitney wins US$233MM Qatar Airways contract http://finance.yahoo.com/news/Pratt-amp-Whitney-wins-233M-apf-15526676.html?.v=1
Mondayâ€™s Market Action
There a Bullish Engulfing Candle on June 12 and one Gap open up on June 1, 2009 at 52.70/53.21, the near term resistance is 55.15, support at 54.20, and the 50 day (EMA) exponential moving average is 53.21. This is United Technologies Corporation (UTX): United Technologies lifts you up and cools you off with it portfolio of well know brands: Carrier, Otis, Pratt & Whitney, and Sikorsky. UTC makes building systems and aerospace products. Carrier is the world's largest maker of heating and air-conditioning units. Otis is the #1 elevator manufacturer; Hamilton Sundstrand produces engine controls, environmental
systems, propellers, and other flight systems; Pratt & Whitney makes engines for both commercial and military aircraft; and Sikorsky makes helicopters. The UTC Fire & Security segment is made up of what were Chubb and Kidde plus UTC Power makes fuel cells for commercial, transportation, and space applications, among other products. The Competitive Landscape Demand is driven by the US military budget and the overall economic climate, which affects airline traffic and demand for new commercial aircraft. The profitability of individual companies depends on technical expertise and the ability to accurately price long-term contracts. Large companies enjoy economies of scale in design, manufacturing, and purchasing. Small companies can compete effectively by concentrating on selected components and parts manufacturing for particular prime contractors. Increasingly, small companies are developing system integration capabilities as large firms outsource more aspects of contracts. Production of aircraft and major aircraft components is highly automated: average revenue per employee is over US$300,000. Aerospace Products and Parts Manufacture Industry Forecast The output of US aerospace products is forecast to grow at an annual compounded rate of 6.8 % between 2008 and 2013.
United Technologies Corporation (HQ) Chairman George David President, CEO, and Director Louis R. Chênevert
1 Financial Plaza Hartford, CT 06103 United States Phone: 860-728-7000 Fax: 860-565-5400 http://www.utc.com
United Technologies Subsidiaries Carrier Corporation Forney Corporation Hamilton Sundstrand Corporation
Wal-Mart Stores, Inc. (WMT) Up-date 16 June 16, 2009 Paul A. Ebeling, Jr. Analyst Today let’s look at Wal-Mart Stores, Inc. (WMT), the World's #1 retailer, from a Technical POV. The overall analysis after Monday’s (June 12, 2009) market action is Neutral: in the near term Neutral, midterm Bearish, and long term Bearish.
**Chart by: www.stockta.com
Latest News: Retailers Retreat Along With Market http://www.thestreet.com/_yahoo/story/10515982/1/retailers-plunge-along-with-market-update.html? cm_ven=YAHOO&cm_cat=FREE&cm_ite=NA
Mondayâ€™s Market Action Close 48.46
- 1.38 Volume 24,601,100/shrs
The are four Gaps open down between Jan 8 and June 15 2009 at 55.06/49.20, the near term resistance is 50.23, support at 48.15, and the 50 day (EMA) exponential moving average is 50.06. This is Wal-Mart Stores, Inc. (WMT): Wal-Mart Stores is an irresistible (or at least unavoidable) retail force that has yet to meet any immovable objects. Bigger than Europe's Carrefour, Tesco, and Metro AG combined, it is the world's #1 retailer, with more than 7,250 stores, including about 975 discount stores, 2,800 combination discount and grocery stores (Wal-Mart Supercenters in the US and ASDA in the UK),
and 590 warehouse stores (SAM'S CLUB). About 55% of its stores are in the US, but Wal-Mart continues expanding internationally; it is the #1 retailer in Canada and Mexico and it has operations in Asia (where it owns a 95% stake in Japanese retailer SEIYU), Europe, and South America. Founder Sam Walton's heirs own about 40% of Wal-Mart. I have never been in a Wal-Mart Store, though I have been in Carreforurâ€™s and Tesco. The Competitive Landscape Demand depends mainly on the volume of car driving, which in turn depends on economic activity. The profitability of individual stores is closely linked to location and product mix. Large companies have advantages in buying gasoline at bulk prices, but small companies can compete effectively by having superior locations. Annual revenue per worker is close to US$300,000. Wal-Mart Stores, Inc. (HQ) Chairman S. Robson (Rob) Walton 702 SW 8th St. Bentonville, AR 72716 United States Phone: 479-273-4000 Fax: 479-277-1830 http://www.walmartstores.com
Wal-Mart Subsidiaries ASDA Group Limited SAM'S CLUB Wal-Mart Brazil
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