Tuesday, December 06, 2011

Morning Journal Our Education Crisis

News on Stocks in Our Portfolios

05:26 PM Qualcomm (QCOM) is forming a subsidiary that will develop wireless communications products for healthcare applications, as well as contain a $100M fund that will make investments in related companies. The subsidiary, called Qualcomm Life, is simultaneously announcing its first product, a solution for allowing medical device users to wirelessly access biometric data. Comment!

03:52 PM S&P downgrades Ecolab (ECL -1.5%) two grades after evaluating its deal to acquire Nalco. The ratings agency said its outlook remains stable. Comment!

10:16 AM Staples (SPLS +2.4%) trades higher after a positive mention in Barron's over the weekend. A low valuation and the firm's outperformance in relation to peers makes it a "great time" to load up on shares even in a widely beat-up sector, notes Sandra Ward. "Despite the head winds, Staples' management has executed well and continues to produce profit and margin gains, albeit at a slower rate and below expectations." Comment!

09:45 AM Nike (NKE +0.8%) takes on a downgrade from McAdams Wright Regan to Hold from Buy. Analysts with the firm say shares are fully valued in light of the pricing pressure it faces and tough consumer conditions. Comment!

08:31 AM Shares of Walgreen (WAG) tack on a 1% gain premarket after reporting November sales increased 4.2% Y/Y to $6.09B . The firm's results were bit by the non-flu bug as a lower incidence of the flu negatively impacted comparable prescriptions filled by almost a full percentage point. Comment!

07:40 AM Authorities in China step up their criminal investigation to determine how toxic chemicals found their way into Coca-Cola (KO) products in a northeast province resulting in the death of a child and illness for three others. An exec for Coca-Cola says test on its products in the region show no quality issues. Shares of KO +1% premarket. Comment!

07:19 AM CME Group (CME) says it will allow investors holding renminbi deposits outside of China to use the currency as collateral for futures trading starting in Jan. 2012. Credit Agricole strategist Dariusz Kowalcyzk says the move has "symbolic significance" with the well-known futures exchange putting a stamp of legitimacy on the Chinese currency. Comment!

06:48 AM Abbott Laboratories (ABT) CEO Miles White dismisses chatter that the firm plans to sell off its soon-to-be-independent drug business. "We're not offering them for sale ... somebody would have to have an awful lot of cash and they'd have to have a 'yes' from a CEO and that would be a tough 'yes' to get." Comment!

This Week’s Data

October factory orders fell 0.4% versus expectations of a 0.3% decline.

The November Institute for Supply Management nonmanufacturing index came in at 52.0 versus estimates of 53.5.


Our education crisis (medium and today’s must read):

Steve Cook received his education in investments from Harvard, where he earned an MBA, New York University, where he did post graduate work in economics and financial analysis and the CFA Institute, where he earned the Chartered Financial Analysts designation in 1973. His 40 years of investment experience includes institutional portfolio management at Scudder, Stevens and Clark and Bear Stearns. Steve's goal at Strategic Stock Investments is to help other investors build wealth and benefit from the investing lessons he learned the hard way.