Schaeffer's Daily Market Blog Features Tommy Hilfiger, Garmin, Cooper Tire & Rubber Company, Overstock.com, and Wal-Mart Stores.CINCINNATI -- Among the stocks featured in the December 27 edition of Schaeffer's Market Blog are Tommy Hilfiger Thomas Jacob Hilfiger (born March 24, 1951 in Elmira, New York) is a world-famous American fashion designer and creator of the eponymous "Tommy Hilfiger" and "Tommy" brands. Biography Hilfiger was born March 24, 1951 and raised in Elmira, New York. (NYSE NYSE See: New York Stock Exchange :TOM), Garmin (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :GRMN), Cooper Tire & Rubber Company (NYSE:CTB CTB Council Tax Benefit (UK) CTB Coopération Technique Belge (French: Belgian Technical Cooperation) CTB Commonwealth Transportation Board (Virginia Department of Transportation) ), Overstock.com (NASDAQ:OSTK), and Wal-Mart Stores (NYSE:WMT (Windows Media Technologies) See Windows Media. ). Schaeffer's Market Blog is just one of the many free market commentaries written every day at www.SchaeffersResearch.com - the home of Bernie Schaeffer and Schaeffer's Investment Research. The Market Blog is written throughout every trading day In Business, the trading day is the time span that a particular stock exchange is open. For example, the New York Stock Exchange is, as of 2006, open from 09:30AM to 4:00PM. Trading days never take place on weekends. by Schaeffer's financial analysts and traders. They are quick insights to the day's most notable market activity from an options perspective. For additional information about this report or to have it delivered to you free via email every day click on the following link. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB PROB Probable/Probably PROB Problem PROB People's Republic of Bangladesh 12M&PAGE=1 . Schaeffer's Market Blog for Tuesday, December 27, 2005: Below are just a few of today's Market Blog entries. Click here to read all of today's Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1 . 11:21 AM Tommy Hilfiger Flat on Positive Earnings Surprise This morning before the market open, Tommy Hilfiger (NYSE:TOM) reported third-quarter earnings of 59 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. , a nickel ahead of analyst estimates. Company revenues declined 6.1-percent year-over-year to $501.8 million, slightly lighter than the consensus estimate of $504.8 million. TOM stock has had a rather muted reaction to the earnings report, as it was trading 11 cents lower to $15.89 at last check. Investors may be more focused on the recent acquisition news for TOM. On December 23, private equity firm Apax Partners proposed to purchase the company for $16.80 per share, although the deal is still subject to regulatory approval. 11:42 AM Puts Pile for Garmin According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. Yahoo! Finance, Garmin (NASDAQ:GRMN) engages in the design, development, manufacture, and marketing of navigation, communications, and information products, which are enabled by global positioning system Global Positioning System: see navigation satellite. Global Positioning System (GPS) Precise satellite-based navigation and location system originally developed for U.S. military use. (GPS) technology worldwide. On Friday, puts traded actively on GRMN, as put volume was 4.1 times heavier than average. The most actively traded put was the January 55 strike (GQR GQR Greenberg Quinlan Rosner Research, Inc. GQR Gaussian Quadrature Rule MK). Investors exchanged nearly 5,100 GQR MK contracts Friday. 4:42 PM Cooper Tire & Rubber Cooper Tire & Rubber Company (NYSE:CTB) peeled out this morning, after it announced that all necessary government approvals have been received for its transaction to obtain 51 percent ownership in China's third-largest Chinese-owned tire manufacturer. The stock was up 3.99 percent on the day. The stock has made some losses this year, but it has enjoyed an uptrend uptrend A series of price increases in a security or in the general market. Some investors believe a security tends to take on a certain inertia; as a result, these investors search for stock in an uptrend, thinking that it will probably continue to move in since late October. A check on today's open interest reveals that more than 4,200 of these contracts translated into new positions of open interest. Implied volatility Implied volatility The expected volatility in a stock's return derived from its option price, maturity date, exercise price, and riskless rate of return, using an option pricing model such as Black-Scholes. on the contract declined seven percent, suggesting the contracts were likely written (or sold). Considering GRMN is trading at $67.34, or 18 percent out-of-the-money for this strike, this appears the most logical explanation for the trade. 4:46 PM Overstock.com Tumbles on Earnings Warning Overstock.com (NASDAQ:OSTK) plunged more than seven percent in trading today after the firm stated that it expects 2005 results to drop in a range of a percentage point or two less than its previous target of breakeven breakeven 1. The level of output or sales necessary to cover fixed expenses. Companies in industries that have high fixed costs and, consequently, high breakevens, such as automobile and steel manufacturing, are likely to exhibit large fluctuations . The Internet retailer forecast revenue growth for the quarter to fall within its stated range of 60 percent to 100 percent. Before items, OSTK expects earnings-per-share results to range from breakeven to positive for the fourth quarter. Furthermore, the firm anticipates negative operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. for 2005 due to a build in inventory balances. As a result, the shares plummeted through former support in the 32 area and they are creeping closer to former long-term support in the 30 region. 4:54 PM Wal-Mart Forecasts Inline Same-Store Sales Same-store sales is a business term which refers to the revenue generated by one of a retail chain's specific outlets during a certain period of time (often a fiscal quarter or a particular shopping season), compared to an identical period in the past, usually in the previous year. Maybe it's because I have paper traded a January 2006 50 put on the company, but the recent spate of bad news for Wal-Mart Stores (NYSE:WMT) has caught my attention. Remember, on Friday, WMT was hit with a $172 million damage judgment in a case concerning lunch-break rights. Today, WMT announced that it sees U.S. comparable-store sales for December increased two to four percent, in line with earlier forecasts. The universe's largest retailer stated that its estimates were based on sales through Friday. As with other retailers, WMT hopes that a busy Christmas Eve Saturday could pull a ho-hum holiday-sales period out of the quagmire. WMT announced that sales of food were stronger than sales for general merchandise, with the Midwest coming in as the strongest region. Why would I paper trade a put on a retailer when we are headed into the teeth of the Christmas retailing season? Simply, WMT's 10-month and 20-month moving averages have capped the equity since April 2004, which is the last time enough strength was displayed to close above this resistance. However, a Schaeffer's put/call open interest ratio of 0.67 (which is lower than 82 percent of the past year's worth of readings) and lack of short-covering support make me wary of the retailer. What truly bother me are analyst rankings. Zacks shows that 14 of the 20 analysts rating WMT consider it a "buy" or better. What happens if this group is shaken by today's news? Answer: downgrades. If downgrades come, watch for the shares to drop more. The above are just a few of today's Daily Market Blog entries. Click here to read all of today's Daily Market Blog. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB1C&PAGE=1 . Take advantage of the timely Schaeffer commentaries by signing up for their free e-newsletters -- Opening View, Market Recap and Monday Morning Outlook. Click here to have the Schaeffer's commentaries delivered to you free via email every day. http://www.schaeffersresearch.com/redirect.aspx?CODE=PROB12M&PAGE=1 . About Schaeffer's Investment Research (www.SchaeffersResearch.com) Schaeffer's Investment Research, founded by Bernie Schaeffer in 1981, is a financial information and trading resources company. It publishes Bernie Schaeffer's Option Advisor, the nation's leading options subscription newsletter. The firm's contrarian approach focuses on stocks with technical and fundamental trends that run counter to investor expectations. The firm's website, http://www.SchaeffersResearch.com , is recognized as one of the leading information sources for stock and options traders and was cited as the top options website by both Forbes and Barron's. Click here for more details about Schaeffer's trading methodology: http://www.SchaeffersResearch.com/method . |
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