In a rare bit of good news for the battered financials, Fifth Third Bancorp (FITB) is trading up +4.14% after being upgraded to Outperform from Neutral at Robert W Baird.
U.S equity futures weaken after release of the ADP employment report
U.S. equity futures have weakened after the release of the ADP employment change report. It was expected to show a decline of -20,000 service jobs but instead showed a decline of -79,000. The larger than expected drop in jobs came after last month’s surprising increase in service jobs. Investors will now turn their attention to the factory orders report for the month of May due out at 10:00 am, and the Department of Energy Inventory report due out at 10:30 am.
Yahoo-YHOO: MicroHoo Redux? Factors to Consider
There was an article in the WSJ suggesting that Microsoft (MSFT) may employ partners to go after and split up Yahoo (YHOO). This would seem odd given that Microsoft purchased Powerset, a “semantic web” technology company that would allow it to compete against Yahoo’s SearchMonkey. Digging around Microsoft Research, it does seem SearchMonkey was something the company had been concerned about. The acquisition of Powerset suggests the company is prepared to roll their own solution. For those bullish on Yahoo (YHOO) one might think the focus would be on the DOJ’s inquiry into the ad sale partnership with Google (GOOG).
Chesapeake-CHK & Plains Ex & Prod-PXP host a conference call at 9am on 7/2
Chesapeake and Plains EX & Prod will host a conference call to discuss the Haynesville Shale joint venture at 9am on 7/2.
Solar: Recommend stocks with little exposure to Spain@DBAB
Deutsche Bank believes potential changes to Spain’s solar PV incentive structure remain a wildcard and prefers stocks with minimal exposure to the country. The firm recommends First Solar (FSLR) and MEMC Electronics (WFR). Deutsche is positive on the long term prospects for companies like SunPower (SPWR), but thinks exposure to Spain and the U.S. will drive significant near term volatility.
Petrohawk Energy-HK: Valued improved due to CHK/PXP acreage deal@FBRC
FBRC believes the company’s low-risk shale assets, as well as 2008 production growth of 27% and 37% growth projected for 2009, warrants in FBRC’s E&P covered universe continued upside potential with HK being their favorite growth name. Target price increased to $60 from $45 and Outperform rating reiterated.
Energy/Natural Resources: Weak earnings season is expected; Market Perform@FBRC
A main drag on results for 2Q08 earnings is the fact that raw material and energy costs increased at a rate quicker than produced commodities,despite most commodity prices being up this past quarter. AA, CENX and ZINC are expected to deliver results lower-than-consensus, while FCX is projected to exceed estimates due to its sales pricing.
Pioneer Natural-PXD coverage resumed with a Buy, target $110@UBSW
Target to $110 from $72.
Pioneer Natural-PXD upgraded to Equal Weight from Underweight@MSCO
Target $90.
Google-GOOG: Expect strong Q2 despite challenging economy@JEFF
Jefferies expects 16% year over year growth in U.S. paid clicks for April/May as they believe GOOG’s search business remains robust. The firm reiterates a Buy rating and $600 target on GOOG shares.
SunPower-SPWR: Potential changes to Spain’s solar PV incentive structure@PACS
PacCrest says SPWR has 70% exposure to US & Spain, which both now have no subsidies. The firm believes Street estimates for FY09 growth need to come down to the 17% range from the 40% range. PacCrest would rather own First Solar (FSLR) than SPWR.
