Tag Archives: Seeking Alpha

Computers

Sprint promises wide rollout and device support for ex-Clearwire spectrum

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Sprint says it will have live LTE sites using former Clearwire spectrum across the U.S. next year and expects all its new mobile devices in 2014 to be equipped for those frequencies — though not necessarily iPhones.

The company gave an update on progress in its Network Vision upgrade project during a conference call on Tuesday to discuss second-quarter financial results, according to a transcript provided by Seeking Alpha. Earlier this month, the fourth-largest U.S. mobile operator got a shot in the arm with its US$21.6 billion acquisition by SoftBank and also bought out former partner Clearwire.

With the Clearwire acquisition, Sprint got access to an emerging Clearwire LTE network that it plans to use for extra mobile data capacity in densely populated areas. Though it uses a slightly different form of LTE than Sprint’s and operates in a relatively short-range spectrum band, around 2.5GHz, the former Clearwire network could give the carrier a large amount of capacity to bolster services in cities.

The network had been intended for Sprint’s use through the longstanding partnership between the two companies, but Sprint’s takeover of Clearwire gave that plan a more solid foundation.

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Source: FULL ARTICLE at PCWorld

News, Politics, Government

Biggest Fib Of The Year: China GDP Grows 7.5% In Q2

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By Gordon G. Chang, Contributor Moments ago, Beijing’s National Bureau of Statistics announced that gross domestic product in the second calendar quarter increased 7.5% from the same period last year, hitting median estimates squarely on the nose.  The announcement confirms China’s growth is slowing but does not fully capture the recent falloff.   What is the real growth figure?  Seeking Alpha thinks it is around 6.7%, but even that figure is high.  Among other factors, the severe contraction of aggregate financing in June, the marked fall in exports in May and June, and the evident shrinkage of the manufacturing sector throughout the quarter all point to an economy growing in the low single digits.  Moreover, it is unlikely that NBS, in releasing the Q2 number, had made proper adjustments to account for two phenomena.  First, Beijing’s official statistics have not been adequately adjusted for inflation, as Standard Chartered’s Stephen Green has pointed out.  Second, fake trade invoicing substantially inflated GDP numbers.  Rampant falsification has resulted in the simply unbelievable report of 14.7% export growth in April, the first month of the just-ended quarter.  Although some say export growth was about 6% then, it seems like it was actually closer to 3%. The most intriguing Q2 indications, however, are the comments of China’s finance minister, Lou Jiwei.  Mr. Lou, speaking in Washington on Thursday, said growth in the first half of 2013 was probably less than 7.7%, “but not too far from it.”  Then he spoke these words: “Our expected GDP growth rate this year is 7%.”  To get to 7% for the entire year after growing 7.7% in Q1 and being “not too far” from 7.7% in Q2, Lou was indirectly telling everyone that China would be expanding at an average of 6.4% in the third and fourth quarters.   Of course, it’s theoretically possible that Lou thinks the economy will fall off the cliff only in the second half of the year, but it is much more likely he knew Q2 growth was far below 7.7% and was preparing everyone for unexpectedly poor performance.  In any event, Beijing immediately censored its finance minister.  Xinhua News Agency, for instance, omitted a striking comment from Lou about the possibility that growth could fall to 6.5% and then erased his 7% forecast for this year, claiming he in fact predicted 7.5%.  The also official—and more authoritative—People’s Daily reported the 7% prediction by carrying another—and more accurate—Xinhua dispatch. What does the utter confusion in official media tell us?  There are two principal points to keep in mind.  First, the differing versions of Lou’s remarks in China’s media suggest there is sharp disagreement among senior leaders over what to do about the economy.  Reformers generally believe—correctly—that reform will decrease growth at first so that the leadership, to allow necessary restructuring to proceed, must de-emphasize gross domestic product as a measuring stick and back off its GDP growth targets.  Lou’s admission of under-target 7% growth signaled, in a subtle way, the leadership was behind reform.  In all probability, those opposed to …read more

Source: FULL ARTICLE at Forbes Latest

Business, Finance, Occupation & Industry

Whoa! These 3 Stocks Just Beat the Dow

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By Rich Duprey, The Motley Fool

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Loose lips sink ships. Someone should have reminded the head of the eurozone’s finance ministers of that World War II slogan before he said openly what everyone feared: the bailout plan to save Cyprus by seizing the assets of individual depositors was a “template” to be used again in the future. Although he scrambled to unsay what was already unsaid, you can’t unring the bell and the Dow Jones Industrial Average fell 64 points yesterday.

As Luxembourg’s Prime Minister Jean-Claude Juncker noted last year, “We all know what to do, we just don’t know how to get reelected after we have done it.” When such tidbits of honesty by politicians and officials are actually spoken, it tends to shake the faith of the markets (the Dow fell almost 60 points the day after Juncker’s quote was reported and was down more than 200 points that week).

The three stocks below, however, had their own bits of truth to tell and rose as a result. But resist the urge to high-five everyone in the cubicles next to you. Smart investors won’t celebrate until they know why their stock surged, because without a fundamental basis for the bounce, these stocks could just as quickly make the return trip down.

Company

% Gain

Horizon Pharma

14.3%

Galena Biopharmaceuticals

7.8%

Sonus Networks

7.1%

A diluted vision
Shares of drug maker Horizon Pharma have surged 18% over the past week since it reported earnings, but the stock is up 33% over the past month and is 43% above its lows. Although it gained a lot of traction yesterday, perhaps in part due to an article on Seeking Alpha  on Sunday suggesting the stock had bottomed, the drug maker also has a growing short interest that stood at over 14 days to cover at the end of February, meaning that it would take two weeks to completely buy back all the shares sold short. The Motley Fool believes anything over seven days is a lot, and the positive news may have pushed short-sellers to start covering their positions.

Horizon has diluted the heck out of the stock over the past year, going from 9 million average shares outstanding at the end of 2011 to almost 39 million shares at the end of last year. But when you look at the quarterly numbers, you see it ended the year with more than 61.5 million shares out, a crippling handicap that has depressed the stock.

Sales for the quarter were up 123% as rheumatoid arthritis and osteoarthritis treatment Duexis sales surged 57%. It also launched Rayos in the quarter, an extended release formulation of prednisone, so Horizon ought to continue bounding back from here.

Race to the finish line
Cancer drug developer Galena Biopharmaceuticals is confident enough in its experimental treatment NeuVax that it went out last week and bought for $10 million the rights to Abstral, a …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

3 Stocks Facing a Crisis of Confidence

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By Rich Duprey, The Motley Fool

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It’s safe to ignore Europe‘s lingering financial woes, folks. Despite the threat of a deep crisis cracking the EU apart, the Federal Reserve says it’s willing to keep the spigot open and QE3 sailing full steam ahead. On cue, the Dow Jones Industrial Average responded with a sharp jump. 

The following three stocks faced a run of a different sort this week as investors turned tail, but don’t go running over the cliff with them like a bunch of lemmings just yet: This could just be a temporary situation. Let’s first see whether they had good reason to fall, as panic-fueled routs can sometimes lead to excellent buying opportunities.

Company

% Change

Chesapeake Granite Wash Trust

(15.3%)

Cia Energetica de Minas Gerais

(12.8%)

ReneSola

(8.5%)

Thank you, sir. May I have another?
It took a little time for the info to sink in, but the 10-K filed by Chesapeake Granite Wash Trust last week apparently showed that all those glowing words written of proven oil reserves at the time of its IPO last year ran smack into the reality of poor results when it actually tried to recover them.

According to an article this week on Seeking Alpha, the trust’s PV-10 value reported when it was spun off from Chesapeake Energy was $17.35 per unit. Last week’s annual report, however, showed they were nearly halved to $9.47 per unit because of lower amounts of reserves. PV-10 is an arcane calculation that oil and gas companies use to estimate future gross revenue to be generated from the production of proven reserves, minus the costs associated with production and future development and then discounted at a 10% rate. The trust’s valuation saw its greatest impact from reductions to the quantity of reserves, which alone swiped a fifth of the value.

Considering the numerous spinoffs of trusts that occurred over the past year or so, it would seem the Granite Wash Trust is as tapped out as its wells.

Powering down
The possibility that Brazil‘s utility regulator, ANEEL, would cut the preliminary asset valuation used to estimate rate reviews sent shares of the country’s second largest utility operator, Cia Energetica de Minas Gerais, tumbling. Because the utility, also known as CEMIG, may see its ability to raise rates pressured by the action, the market quickly looked askance at its future profit generating potential.

CEMIG says the reaction to the news was exaggerated because the utility had already factored the rate cut into its forecasts, though at least one research firm downgraded the shares to a hold. Brazil is seen as having a government more willing to intervene in its economy, which could pose problems for the private sector, but with a consumer base still willing to spend their way out of a recession, the effects will be limited.

It’s not as if utilities aren’t highly regulated already so CEMIG just may be right …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

4 Treasures From the Great "Dash for Trash" Rebound of 2009

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By Alex Planes, The Motley Fool

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The financial crisis ended — at least where the markets are concerned — four years ago. But some people couldn’t believe it was over. On the way back up, they warned that it was a garbage rally, a sucker’s game that would soon take adventurous investors to the poorhouse. Pundits and analysts pointed to dire financials and warned that soaring speculative selections might soon go the way of the dodo.

Plenty of stocks did go belly-up. But an elite few not only survived, but they thrived — producing outsized gains that have made the Dow Jones Industrial Average‘s four-year double look like pocket change. Make no mistake: These were some incredibly risky stocks to chase in the dark days of 2009, as you’ll soon see from a few eye-popping then-and-now financial comparisons. Did you listen to the doomsayers and sit on the sidelines, or did you jump in with both feet, not knowing when (if ever) you might touch bottom?

Sucker’s-rally stocks that soared
The Dow bottomed out on March 9, 2009, after peaking in October 2007, and it’s since recovered to set fresh all-time record highs. In the four years since that day, the index has gained 120%, which increases to 146% if its components’ dividends are added to the calculation. That’s not bad, but it can’t hold a candle to these “garbage stocks” that turned out to be diamonds in the rough. Each has returned a minimum of 500% since the end of the financial-crisis crash, and some have recorded gains well in excess of 1,000%:

Stock

Total Loss From Peak to Trough (2007-2009) 

Market Cap at End of Crash 

Total Return Since End of Crash 

Newcastle Investment Corp

98%

$16.36 million

4,350%

American Express

83%

$12.34 billion

555%

General Growth Properties

99%

$98.81 million

5,630%

Ford

79%

$4.20 billion

666%

Source: YCharts.

What a wild ride. Let’s see how these companies have performed on a variety of metrics, both before and after the crash, to get a better understanding for why their stocks were so hated then — and why they’ve since proved the doubters wrong.

What happened to Newcastle?

  • Trailing-12-month earnings per share in 2009: ($56.81)
  • Most recent TTM earnings per share: $2.94
  • Debt-to-cash ratio in 2009: 105.3
  • Most recent debt-to-cash ratio: 8.0
  • Total return from start of crash to today: (14%)

 On June 11, 2009, a Seeking Alpha blogger said:

“Non-recurring expenses during the last two quarters … reflect the mark-to-market valuation of securities, many of them the toxic subprime mortgage securities so well documented in the media, turning out to be quite toxic indeed. [This] has turned a healthy, albeit highly leveraged, balance sheet, into one … poised to feel the cost of the recession in the form of delinquencies at levels which continue to rise precipitously, year over year.”

When this article was published, Newcastle had already gained 145% from …read more
Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

Why Himax Technologies Shares Skyrocketed

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By Evan Niu, CFA, The Motley Fool

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Although we don’t believe in timing the market or panicking over market movements, we do like to keep an eye on big changes — just in case they’re material to our investing thesis.

What: Shares of Himax Technologies have skyrocketed today by as much as 39% after an article on Seeking Alpha speculated that the company could greatly benefit from Google Glass and could triple.

So what: Author Mark Gomes claims that him and his research team have uncovered evidence that suggests Himax will be the primary provider of Google Glasss micro display. Gomes also cites commentary from Himax’s last conference call as contributing to this view, as CEO Jordan Wu noted a “new and exciting head-mounted display application.”

Now what: Himax also recently referred to large domestic software companies as possible customers, and the article says that Himax shipped 20,000 chips last quarter, which matches up with Google’s announcement that Glass is expected to hit the consumer market later this year at a retail price point of under $1,500. Gomes also points to recent footage of the device in action, saying the panel looks identical to those offered by Himax. The author believes Street estimates will rise to factor in the possible Google Glass win, and calls for shares to triple.

Interested in more info on Himax? Add it to your watchlist by clicking here.

The article Why Himax Technologies Shares Skyrocketed originally appeared on Fool.com.

Fool contributor Evan Niu, CFA. has no position in any stocks mentioned. The Motley Fool recommends Google. The Motley Fool owns shares of Google. Try any of our Foolish newsletter services free for 30 days. We Fools don’t all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

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Source: FULL ARTICLE at DailyFinance

News, Politics, Government

Who Wins, iOS or Android? Both, But Pity Everyone Else.

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By Chunka Mui, Contributor Bert Danner has an interesting article at Seeking Alpha on the mobile platform war between Apple’s iOS versus Google’s Android. Danner argues that Apple will win over Google because its software and business model are better structured for harnessing the “network effects” of software platforms. I think Danner over-reaches in […]
Source: FULL ARTICLE at Forbes Latest