Equities Sector Coverage: Stocks Rebound Modestly from Worst Day of 2012

Sector Recap |

Wall Street Stock MarketThe Dow Jones Industrial Average rallied from a low of 12751.51 to a high of 12858, but the daily chart remains negative. The NASDAQ rallied from a low of 2920.54 to a high of 1940.28, but the daily chart remains negative.

Asian stocks were lower again on Wednesday. The Nikkei 225 ended their session at 9,576 – down 0.64% on the day. The Hang Seng ended their session at 20,628 – down 0.86% on the day. European stocks traded slightly higher on Wednesday. The FTSE 100 ended their session at 5,791 – up 0.44% on the day, the DAX ended their session at 6,671 – up 0.57% on the day, and the CAC 40 ended their session at 3,392 – up 0.89% on the day.

The yield on the 10-Year US Treasury traded between 1.986 percent and 1.944 versus its 50-day simple moving average at 1.947. Gold traded between $1671.7 and 1687.7 the Troy ounce versus 50-day and 200-day simple moving averages at $1689.8 and $1673.8. A trend below these moving averages where the 50-day falls below the 200-day defines a “death cross.” Crude oil traded between $104.35 per barrel and $106.55. The euro versus the dollar traded between 1.3100 and 1.3163.

Energy

Norway's Statoil (STO) is said to be the frontrunner to buy Anadarko Petroleum's (APC) Brazilian operations, edging out France's Total (TOT) and Denmark’s Maersk for the assets, which are valued at $3B-$4B. Tesoro (TSO) gets taken to Neutral from Underperform at Bank of America-Merrill Lynch. CVR Energy (CVI) is now Neutral from Outperform at Macquarie.

Energy Select Sector SPDR (XLE) was trading at $73.66 at 4:00 PM on Wednesday, up 0.84% on the day – up 6.55% year-to-date. The February 2012 change was +5.93%. The 2011 change was -1.29%
Heavily Traded: (VLO) +6.5%.

Materials

Bunge (BG) and Glencore (GLCNF) are reportedly among the companies that have expressed an interest in the possible sale of U.S. energy and grains trader Gavilon Group.

The Materials Select Sector SPDR (XLB) was trading at $36.03 at 4:00 PM on Wednesday, up 0.25% on the day – up 7.55% year-to-date. The February 2012 change was -0.56%. The 2011 change was -12.78%.
Heavily Traded: (VALE) -1.8%, (FCX) -0.9%, (AA) +1.2%.

Industrials

Honeywell (HON) reaffirms its 2012 outlook and reduces the range of its Q1 EPS guidance to $0.96-$0.98, the high-end of a prior range. Honeywell also says it's on track to achieve its 2014 sales target of $41B-$45B and its segment margin goal of 16%-18%. Hill International (HIL) missed estimates by 3 cents, while beating revenue by $17M. Schawk (SGK) missed estimates by 4 cents, while beating revenue by $5M. AeroVironment (AVAV) missed estimates by 17 cents and revenue by $15M. Manpower (MAN) and Robert Half International (RHI) are both begun with Buys at UBS, which has a new Neutral on Korn/Ferry (KFY). Rockwell Automation (ROK) is picked up with an Outperform by Sanford Bernstein. USG Corp (USG) is moved to Outperform from Neutral at Macquarie. AeroVironment (AVAV) is downgraded to Hold from Buy at EarlyBirdCapital.

The Industrial Select Sector SPDR (XLI) was trading at $36.42 at 4:00 PM on Wednesday, up 1.03% on the day – up 7.91% year-to-date. The February 2012 change was +2.79%. The 2011 change was -3.21%.

Heavily Traded: (GE) +2.3%, (GLW) +1.8%.

Consumer Discretionary

Ford (F) CEO Alan Mulally reaps the benefits of reviving the car maker's fortunes, receiving $58.3M in stock as part of an incentive plan from 2009. Netflix (NFLX) CEO Reed Hastings has "quietly met" with executives at top cable providers about making the video service available as a subscription option, Reuters reports. Hovnanian (HOV) beat estimates by 26 cents, while missing revenue by $2M. Speedway Motorsports (TRK) reported Q4 EPS of $0.00 (in-line), while beating revenue by $6.7M. American Eagle Outfitters (AEO) missed estimates by a penny and revenue by $10M. Bon-Ton Stores (BONT) reported Q4 EPS of $3.07 (versus consensus of $3.24), while missing revenue by $17M. For FY12, the company sees comparable store sales of 1% to 2% and EBITDA in a range of $180M-$200M. Maidenform Brands (MFB) missed estimates by 2 cents, while beating revenue by $8.3M. Lincoln Educational Services (LINC) beat estimates by 5 cents with revenue in-line with estimates. Express Inc (EXPR) beat estimates by 2 cents with revenue in-line with estimates. Children's Place (PLCE) missed estimates by 2 cents and revenue by $25M. Brown Shoe (BWS) missed estimates by 10 cents and revenue by $15M. Pandora Media (P) missed estimates by a penny and revenue by $1.8M. The company expects FQ1 revenue of $72M-$75M and EPS of -$0.18 to -$0.21 (below consensus of $86.6M and -$0.02) and FY13 revenue of $410M-$420M and EPS of -$0.11 to -$0.16 (largely below consensus of $418.3M and $0.01). Dick’s Sporting Goods (DKS) is now Neutral from Underperform at Sterne Agee. Lululemon athletica (LULU) is boosted to Outperform from Neutral at Credit Suisse. Jack in the Box (JACK) is raised to Neutral from Underperform at Credit Suisse. Carmike Cinemas (CKEC) is upgraded to Overweight from Neutral at Piper Jaffray. Sotheby’s (BID) is moved to Perform from Outperform by William’s Capital Group. Pandora Media (P) is cut by both Citigroup (Neutral from Buy) and Raymond James (Market Perform from Outperform).

The Consumer Discretionary Select Sector SPDR (XLY) was trading at $43.29 at 4:00 PM on Wednesday, up 1.14% on the day – up 10.94% year-to-date. The February 2012 change was +10.09%. The 2011 change was +4.30%.
Big Movers: (BONT) +28.5%, (P) -24%, (BWS) -13%.



Consumer Staples

Bunge (BG) and Glencore (GLCNF) are reportedly among the companies that have expressed an interest in the possible sale of U.S. energy and grains trader Gavilon Group. The Fresh Market (TFM) reported Q4 EPS of $0.38 (in-line) and revenue of $320.8M (in-line). China New Borun (BORN) beat estimates by 5 cents and revenue by $4M. Chefs Warehouse (CHEF) beat estimates by a penny and revenue by $3M. Nestlé (NSRGY) is now Outperform from Neutral at BNP Paribas. Kraft Foods (KFT) is moved to Hold from Buy at Jefferies. Unilever (UN) is now Neutral from Outperform by BNP Paribas.

The Consumer Staples Select Sector SPDR (XLP) was trading at $33.13 at 4:00 PM on Wednesday, up slightly on the day – up 1.97% year-to-date. The February 2012 change was +3.75%. The 2011 change was +10.85%.
Heavily Traded: (WMT) +1.1%, (KFT) -1.4%.

Health Care

Forest Labs (FRX) and France's Pierre Fabre Medicament have reported a second set of positive results in Phase III trials of the anti-depressant drug levomilnacipran. Simcere Pharmaceutical (SCR) beat estimates by 7 cents, while missing revenue by $6M. Emeritus (ESC) reported Q4 EPS of $0.34 (versus consensus of $0.41) with revenue in-line with revenue. MAKO Surgical (MAKO) reported Q4 EPS of -$0.14 (in-line), while beating revenue by $2M. Analogic (ALOG) reported FQ2 EPS of $0.80 (versus consensus of $0.59) with revenue in-line with estimates. STAAR Surgical (STAA) reported Q4 EPS of $0.00 (versus consensus of $0.02) with revenue in-line with estimates. Metabolix (MBLX) beat estimates by 2 cents, while missing revenue by $61K. Acadia Pharmaceuticals (ACAD) reported Q4 EPS of -$0.10 (in line), while beating revenue by $38K. Allos Therapeutics (ALTH) beat estimates by 8 cents with revenue in-line with estimates. Verastem (VSTM) is a new Outperform at Oppenheimer, which establishes a price objective of $16. Express Scripts (ESRX) is increased to Outperform from Neutral at Macquarie. Medidata Solutions (MDSO) is raised to Neutral from Underweight at Piper Jaffray. Medco Health Solutions (MHS) is moved to Neutral from Outperform at Macquarie. Aegerion Pharmaceuticals (AEGR) is lowered to Neutral from Buy at Lazard. Vermillion (VRML) is slashed to Sell from Neutral at Ladenburg Thalmann. ZELTIQ Aesthetics (ZLTQ) is cut to Neutral from Buy at Goldman Sachs and to Neutral from Overweight at JPMorgan.

The Health Care Select Sector SPDR (XLV) was trading at $35.92 at 4:00 PM on Wednesday, up 0.45% on the day – up 3.55% year-to-date. The February 2012 change was +1.06%. The 2011 change was +10.32%.
Heavily Traded: (PFE) +0.5%, (MRK) -0.5%.

Financials

The steep fall in natural gas prices over recent years has sparked doubts about the future of Texas utility Energy Future Holdings, which, as TXU, was bought by a P-E consortium led by KKR (KKR) Goldman Sachs (GS) and TPG for $45B in debt and equity in 2007. ZipRealty (ZIPR) missed estimates by 3 cents and revenue by $3.5M. Douglas Emmett Inc (DEI) is started at an Overweight with Morgan Stanley. SLM Corp (SLM) is assumed with an Outperform at Keefe Bruyette. Moody’s (MCO) is a new Neutral at UBS.

The Financial Select Sector SPDR (XLF) was trading at $14.63 at 4:00 PM on Wednesday, up 1.28% on the day – up 12.54% year-to-date. The February 2012 change was +5.02%. The 2011 change was -18.50%; the weakest performing sector for the year.

Big Mover: (WAMUQ) -12.25%.

Heavily Traded: (BAC) +2.8%, (C) +3.3%, (MS) +3.1%, (JPM) +1.8%, (WFC) +1.9%, (FITB) +3.1%, (RF) +1.6%.

Information Technology

Apple (AAPL) is expected to unveil the iPad 3 today. However, bucking much of the bullish commentary, Global Equities thinks consumers won't line up for the new tablet if gas prices remain elevated. Ciena (CIEN) missed estimates by 13 cents with revenue in-line with estimates. Canadian Solar (CSIQ) missed estimates by $1.00 and revenue by $11M. ChinaCache (CCIH) missed estimates by 9 cents with revenue in-line with estimates. Cypress Semiconductor (CY) now expects Q1 revenue of $180M-$190M and EPS of $0.08-$0.11 (below a consensus of $205.9M and $0.17). Global Cash Access Holdings (GCA) beat estimates by 4 cents and revenue by $8M. TNS (TNS) beat estimates by 9 cents with revenue in-line with estimates. Cantor Fitzgerald begins Buy rated coverage on Dow component Cisco Systems (CSCO), Riverbed Technology (RVBD), Datalink (DTLK), and Emulex (ELX). It has Holds on Juniper Networks (JNPR), NetApp (NTAP), EMC Corp (EMC), F5 Networks (FFIV), QLogic (QLGC), and Brocade (BRCD). Altera (ALTR) initiated with a Reduce at Nomura, Xilinx (XLNX) initiated with a Neutral at Nomura. FactSet Research Systems (FDS) is a fresh Neutral at UBS, which resumes MSCI Inc (MSCI) at a Buy. Automatic Data (ADP) is added to the US Focus List at Credit Suisse.

The Technology Select Sector SPDR (XLK) was trading at $28.76 at 4:00 PM on Wednesday, up 0.75% on the day – up 13.01% year-to-date. The February 2012 change was +7.08%. The 2011 change was +1.03%.
Big Mover: (GCA) +18.5%.

Telecommunication Services

Cellcom Israel (CEL) reported Q4 EPS of $0.75 (versus consensus of $2.52), while missing revenue by $150M.
The NASDAQ Telecommunications Index (IXTC) was trading at $208.32 at 4:00 PM on Wednesday, up 0.40% on the day – up 5.78% year-to-date. The February 2012 change was +1.63%. The 2011 change was -12.62%.
Heavily Traded: (S) +2.4%, (T) +0.6%, (FTR) -0.8%, (CLWR) +3.1%, (VZ) +0.7%, (PCS) +3.1%.

Utilities

RWE AG (RWEOY) is cut to Underweight from Neutral at HSBC Securities.

The Utilities Select Sector SPDR (XLU) was trading at $34.92 at 4:00 PM on Wednesday, relatively unchanged on the day – down 2.95% year-to-date. The February 2012 change was +0.61%. The 2011 change was +14.81%; the strongest performing sector for the year.
Heavily Traded: (CNP) +1%, (AEP) +0.25%, (DUK) up slightly, (EXC) -0.6%, (POM) +0.9%.

STOCKS: STO, APC, TOT, TSO, CVI, VLO, BG, GLCNF, VALE, FCX, AA, HON, HIL, SGK, AVAV, MAN, RHI, KFY, ROK, USG, GE, GLW, F, NFLX, HOV, TRK, AEO, BONT, MFB, LINC, EXPR, PLCE, BWS, P, DKS, LULU, CKEC, BID, TFM, BORN, CHEF, NSRGY, KFT, UN, WMT, KFT, FCX, SCR, ESC, MAKO, ALOG, STAA, MBLX, ACAD, ALTH, VSTM, ESRX, MDSO, MHS, AEGR, VRML, ZLTQ, PFE, MRK, KKR, GS, ZIPR, DEI, SLM, MCO, WAMUQ, BAC, C, MS, JPM, WFC, FITB, RF, AAPL,, CIEN, CSIQ, CCIH, CY, GCA, TNS, CSCO, RVBD, DTLK, ELX, JNPR, NTAP, EMC, FFIV, QLGC, BRCD, ALTR, XLNX, FDS, MSCI, ADP, CEL, S, T, FTR, CLWR, VZ, PCS, RWEOY, CNP, AEP, DUK, EXC, POM

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
BORN China New Borun Corporation American Depositary Sh 1.18 -0.04 -3.27 7,424 Trade
GLW Corning Incorporated 28.85 -0.17 -0.59 7,706,994 Trade
FDS FactSet Research Systems Inc. 163.26 -0.57 -0.35 253,303 Trade
EXPR Express Inc. 8.63 -0.19 -2.15 1,728,484 Trade
RHI Robert Half International Inc. 46.05 -0.58 -1.24 1,118,320 Trade
AVAV AeroVironment Inc. 28.57 -0.63 -2.16 238,946 Trade
MDSO Medidata Solutions Inc. 65.43 0.24 0.37 502,480 Trade
FTR Frontier Communications Corporation 1.88 -0.03 -1.57 43,959,696 Trade
MAN ManpowerGroup 100.98 -1.09 -1.07 490,184 Trade
GE General Electric Co 28.99 -0.09 -0.31 24,079,191 Trade
BRCD Brocade Communications Systems Inc. 12.57 0.02 0.16 2,197,024 Trade
ADP Automatic Data Processing Inc. 104.49 -0.67 -0.64 1,610,922 Trade
VALE VALE S.A. American Depositary Shares Each Represen 8.58 0.16 1.90 17,171,245 Trade
CEL Cellcom Israel Ltd. 9.89 0.02 0.20 2,629 Trade
KFY Korn/Ferry International 32.40 -0.63 -1.91 264,999 Trade
WMT Wal-Mart Stores Inc. 75.18 -0.26 -0.34 7,330,420 Trade
AA Alcoa Inc. 33.73 -0.79 -2.29 5,240,048 Trade
MBLX Metabolix Inc. n/a n/a n/a n/a
VLO Valero Energy Corporation 64.61 -0.71 -1.09 4,079,246 Trade
CNP CenterPoint Energy Inc (Holding Co) 28.53 -0.11 -0.38 2,269,351 Trade
DEI Douglas Emmett Inc. 37.67 -0.46 -1.21 709,140 Trade
STAA STAAR Surgical Company 10.40 -0.25 -2.35 88,932 Trade
CHKR Chesapeake Granite Wash Trust representing benefic 2.50 0.00 0.00 46,225 Trade
ALOG Analogic Corporation 71.85 -0.80 -1.10 72,471 Trade
DTLK Datalink Corporation n/a n/a n/a 0 Trade
AAPL Apple Inc. 143.65 -0.14 -0.10 20,860,358 Trade
ACAD ACADIA Pharmaceuticals Inc. 34.33 0.50 1.48 1,127,295 Trade
P Pandora Media Inc. 10.85 -0.25 -2.25 7,325,743 Trade
BONT The Bon-Ton Stores Inc. 0.58 -0.01 -1.69 60,162 Trade
XLNX Xilinx Inc. 63.11 -1.29 -2.00 4,066,270 Trade
C Citigroup Inc. 59.12 -0.27 -0.45 11,917,075 Trade
TSO Tesoro Corporation 79.71 -0.14 -0.18 1,575,333 Trade
S Sprint Corporation 9.03 0.00 0.00 11,256,495 Trade
FITB Fifth Third Bancorp 24.43 -0.22 -0.89 4,879,891 Trade
MS Morgan Stanley 43.37 -0.17 -0.39 9,049,132 Trade
JPM JP Morgan Chase 87.00 -0.61 -0.70 10,755,629 Trade
HON Honeywell International Inc. 131.14 1.26 0.97 5,979,521 Trade
TOT Total S.A. 51.17 -0.44 -0.85 3,296,657 Trade
CKEC Carmike Cinemas Inc. n/a n/a n/a 0 Trade
ROK Rockwell Automation Inc. 157.35 -1.92 -1.21 1,450,620 Trade
VSTM Verastem Inc. 1.94 0.07 3.74 194,401 Trade
HOV Hovnanian Enterprises Inc. Class A 2.34 -0.06 -2.50 679,623 Trade
ESRX Express Scripts Holding Company 61.34 -0.06 -0.10 6,560,967 Trade
CSCO Cisco Systems Inc. 34.07 0.32 0.95 20,461,746 Trade
HIL Hill International Inc. 4.05 -0.05 -1.22 124,777 Trade
GS The Goldman Sachs Group Inc. 223.80 -2.01 -0.89 2,936,589 Trade
CHEF The Chefs\' Warehouse Inc. 13.65 -0.50 -3.53 150,523 Trade
UN Unilever NV 52.24 0.20 0.38 1,716,325 Trade
VZ Verizon Communications Inc. 45.91 -0.76 -1.63 25,922,757 Trade
BAC Bank of America Corporation 23.34 -0.31 -1.31 69,384,908 Trade
BID Sotheby\'s 47.36 -0.61 -1.27 517,128 Trade
JNPR Juniper Networks Inc. 30.07 0.08 0.27 9,756,840 Trade
FCX Freeport-McMoRan Inc. 12.75 -0.26 -2.00 22,831,017 Trade
VRML Vermillion Inc. 1.89 0.02 1.07 56,054 Trade
CIEN Ciena Corporation 22.91 -0.24 -1.04 2,048,723 Trade
APC Anadarko Petroleum Corporation 57.02 -0.10 -0.18 5,059,768 Trade
RF Regions Financial Corporation 13.75 -0.04 -0.29 14,091,521 Trade
USG USG Corporation 30.30 -0.38 -1.24 2,085,389 Trade
LULU lululemon athletica inc. 52.00 -0.77 -1.46 4,233,362 Trade
GCA null n/a n/a n/a 0 Trade
F Ford Motor Company 11.47 0.00 0.00 41,415,145 Trade
PFE Pfizer Inc. 33.92 0.06 0.18 15,979,173 Trade
ALTR Altera Corp. n/a n/a n/a 0 Trade
POM Pepco Holdings Inc. n/a n/a n/a 0 Trade
TFM The Fresh Market Inc. n/a n/a n/a 0 Trade
WFC Wells Fargo & Company 53.84 -0.60 -1.10 16,501,919 Trade
PLCE Children\'s Place Inc. (The) 114.80 0.15 0.13 594,019 Trade
TRK Speedway Motorsports Inc. 18.05 -0.88 -4.65 58,324 Trade
CSIQ Canadian Solar Inc. 13.30 -0.38 -2.78 1,523,251 Trade
DKS Dick\'s Sporting Goods Inc 50.55 -0.46 -0.90 2,146,952 Trade
NFLX Netflix Inc. 152.20 -0.88 -0.57 6,366,247 Trade
AEGR Aegerion Pharmaceuticals Inc. n/a n/a n/a 0 Trade
MRK Merck & Company Inc. (new) 62.33 -0.25 -0.40 9,461,664 Trade
CCIH ChinaCache International Holdings Ltd. 1.14 0.03 2.70 74,935 Trade
MCO Moody\'s Corporation 118.32 -1.11 -0.93 669,044 Trade
STO Statoil ASA 16.43 0.01 0.06 1,166,143 Trade
MSCI MSCI Inc 100.32 -0.08 -0.08 288,890 Trade
CY Cypress Semiconductor Corporation 14.01 -0.39 -2.71 13,813,727 Trade
LINC Lincoln Educational Services Corporation 2.88 -0.01 -0.35 5,736 Trade
CVI CVR Energy Inc. 21.89 -0.07 -0.32 1,292,036 Trade
EXC Exelon Corporation 34.63 -0.21 -0.60 4,112,349 Trade
T AT&T Inc. 39.63 -0.28 -0.70 24,994,983 Trade
BG Bunge Limited 79.03 0.54 0.69 1,179,318 Trade
AEO American Eagle Outfitters Inc. 14.09 0.18 1.29 4,188,683 Trade
DUK Duke Energy Corporation (Holding Company) 82.50 -0.40 -0.48 2,166,592 Trade
SLM SLM Corporation 12.54 -0.10 -0.79 3,064,490 Trade
QLGC QLogic Corporation n/a n/a n/a 0 Trade
NTAP NetApp Inc. 39.85 0.09 0.23 2,176,694 Trade
EMC EMC Corporation n/a n/a n/a 0 Trade
KKR KKR & Co. L.P. Representing Limited Partnership In 18.98 0.25 1.33 3,206,829 Trade
ZLTQ ZELTIQ Aesthetics Inc. 56.48 0.00 0.00 0 Trade
AEP American Electric Power Company 67.83 -0.27 -0.40 2,671,290 Trade
FFIV F5 Networks Inc. 129.13 2.14 1.69 1,684,245 Trade

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