WALL STREET JOURNAL

The books of Fannie Mae (FNM) and Freddie Mac (FRE) are being examined by the Federal Reserve and the Office of the Comptroller of the Currency to review their financial condition, according to the Wall Street Journal…The Wall Street Journal also reported that the Chevy Volt, an electric car from General Motors (GM), is slated to roll out in two years and it received a major boost from 36 utilities that operate in 40 states who agreed to work together to make the plug-in vehicle possible. Among the utilities are American Electric Power (AEP), Consolidated Edison (ED), Duke Energy (DUK), and Edison International (EIX)…FINANCIAL TIMES: Struggling mortgage lender Paragon is reportedly in talks with Blackstone (BX) about a potential takeover by Blackstone, the Financial Times reported…NEW YORK TIMES: The New York Times reported that TiVo (TIVO) will today introduce a “product purchase” feature in partnership with Amazon.com (AMZN). Under TiVo’s plan, the television remote control will be turned into a tool for buying products that are advertised and promoted on talk shows and commercials…

Blackstone is in talks about buying a mortgage company-FT
Blackstone (BX) is negotiating a possible takeover of troubled mortgage lender Paragon (PGMT). The talks are an indication that private equity firms are still interested in buying mortgage companies.
Good news for the market and for the mortgage business, let’s hope PE firms pull the trigger. That would boost the market.

Woodward Governor-WGOV still has major growth opportunities@GABE
After Woodward reported better than expected results for its Q3, Gabelli believes the company can grow because it can attract customers who must operate their aircraft engine or industrial and power generation equipment cleaner cheaper and more reliably. The firm maintained their Buy rating.

Apple-AAPL lowering estimates and target, maintain Buy@GSCO
Goldman lowered AAPL estimates citing lower gross margins but said they believe management’s guidance will prove conservative. Target to $200 from $220. The firm notes that all 3 major product initiatives are working and maintains their Buy rating.

Apple-AAPL: Quarter suggests product momentum is intact@PIPR
Piper maintains a Buy rating despite saying the margin guidance was a “shock” as they believe the Street will likely look past margin guidance and focus on product transitions by the end of the September quarter.

XTO Energy-XTO reports Q2 EPS $1.13 vs. consensus of $1.05
Reports Q2 revenue $1.94B vs. consensus $1.85B.
XTO Energy-XTO acquires additional $1.3B in properties
XTO Energy Inc. announced that it has entered into definitive agreements with multiple parties to purchase producing properties located in its Eastern and San Juan Regions and acreage positions in the Marcellus, Fayetteville, Barnett, and Haynesville shales, for a total of about $1.3 billion, of which $1 billion closed during the second quarter. From the producing properties, XTO Energy’s internal engineers estimate proved reserves to be 185 billion cubic feet of natural gas equivalent of which approximately 60% are proved developed. Starting July 1, these acquisitions add 20 million cubic feet of natural gas equivalent per day to the Company’s production base. In the high potential shale plays, the Company added more than 280,000 net undeveloped acres to its inventory for future development, primarily in the Marcellus and Fayetteville.

U.S. equity futures still point to a lower open

The futures markets, while pointing to a lower open this morning, have moved up based on comments from Treasury Secretary Paulson who is speaking now in New York. Paulson is asking the public for patience with the housing and market woes as the U.S. is “on (the) right path” to end the market disruptions. Gold futures rose 1% this morning as investors seek a safe haven from worries in the financial sector and the economy. Gold for August delivery gained $9.30 to $973 an ounce on the New York Mercantile Exchange. The DJIA is down -77 points to 11,388, the Nasdaq is down -30 points to 1,797, and the S&P is down -9.3 points to 1,252.

Genentech-DNA: Expect deal to go through at premium to $89/share@RBCM
RBC believes an acquisition price in the $95-$100/share range is reasonable and maintains an Outperform rating on DNA shares.

Apple-AAPL: Recommend building core positions on the weakness@THNK
ThinkPanmure believes lowering expectations bodes well for the stock longer term and maintains a Buy rating. The firm lowered their target to $200 from $225.

Apple-AAPL: See good buying opportunity, reiterate Outperform@JMPS
After Apple reported results for its Q3 that JMP Securities views as solid, the firm increased their market share estimates but reduced their gross margin estimates. JMP Securities thinks the company’s lower than expected guidance creates a good buying opportunity.