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Wall Street to Main Street: News, Views and Commentary: May 30, 2006
- by Louis Victor
It's Tuesday May 30, 2006, and we hope that everyone had a great three-day weekend here in the United States and to our international readers due to the holiday there was no Monday edition distributed. So now its time to shake out the cobwebs and get back down to business.
On a sad note, over the weekend CBS News correspondent Kimberly Dozier was critically injured by a bomb that was directed towards the 4th Brigade Combat Team, 4th Infantry Division. Her cameraman Paul Douglas and soundman James Brolan were killed in the attack. They were working on a story that was about what life is like for the troops stationed in Iraq during Memorial Day.
Bloggers 1, Apple Computer 0: Apple Computer (NASDAQ: AAPL) lost a round in court against a group of Bloggers recently. They wanted to force two bloggers that posted information on Apple to reveal their sources but the California court rejected their claim. Blogs are a new form of communication and although there have been cases of "Bashing" that went to court and the bloggers lost, in this case it's all about freedom of speech. Had this blog post been an article in the Wall Street Journal or the New York Times it would have never reached the courthouse but because it's a sole blogger making statements it made it an easy decision for Apple to take it to court. That is going to have to be a topic of discussion on Wall Street to Main Street as to whether a publicly traded company has the ability to stifle a blogger if the post is based on facts. We want to hear your thoughts on that topic, so shoot us out an email..
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Keep in mind that they topics for this week's investor commentary are Gold, Oil and Gas Prices. To participate you can either call us toll free at 888-463-9237 between the hours of 6:30pm and 12am EST weekdays or shoot us out an email using our contact form on our website at www.namcnewswire.com. Make sure to include your name and state in the email or in the audio.
Remember that you can always listen to the NAMC Radio on Streetiq.com, the leader in financial podcast. www.streetiq.com and is also available on iTunes. The master of the Leveraged Buy Outs or LBO's Kohlberg, Kravis and Roberts are sitting on the sidelines for this one, at least for now. The pipeline operator Kinder Morgan (NYSE: KMI) has been put in play by its CEO Richard D. Kinder and his management team, as they sent a letter to the board of directors of Kinder Morgan over the weekend placing an offer of $100 a share on the table for the company. His intent is to take the company private. This is over an 18% premium of Fridays $84.41 closing price. This could wind up being a deal valued in excess of $22 billion. We've mentioned the stakes that have been put in the ground by the SEC and the U.S. Government in regards to CEO compensation and the Stock Options Probe that is continuing to grow, this is one CEO that is making a proactive move and this could start the ball rolling as more CEO's of public companies are put to the test. So we just may see a big boom in private equity and leverage buyout activity, so expect to see firms like KKR in the news frequently over the next 24 months.
Advanced Micro Devices (NYSE: AMD) is not waiting for a miracle as they are making moves to continue to take market share from Intel (NASDAQ: INTC). They have announced plans of a $2.5 billion expansion in Eastern Germany. The expansion will include additional 300-millimeter wafer production facilities, as well as a new clean-room facility for the final stages of manufacturing. Remember that they just recently inked a deal with Dell (NASDAQ: DELL) and Dell inked a deal with Google (NASDAQ: GOOG), so this could get interesting for investors.
And just when you thought it was over it starts right up again, Martha Stewart has put on the boxing gloves yet again in the Imclone Systems (NASDAQ: IMCL) scandal, as opposed to settling the SEC charges. She did a five month stint in prison on the same charges but this civil victory is a tad bit different because if she should win she could become the CEO of her company Martha Stewart Living Omnimedia (NYSE: MSO) once again. So she has all the reason in the world to fight, as the SEC wants her banned from serving as a director of any public company.
Agco Corp (NYSE: AG) has formed a joint venture in Russia with SM Group to sell two tractor brands, Fendt and Valtra equipment, to farmers in Russia and Kazakhstan. This is a bold move for Agco and could give them nice footing in that region that is just ramping up.
Just to update you on the CBS (NYSE: CBS), Sirius Satellite (NASDAQ: SIRI) situation, is seems as the settlement amount was in the neighborhood of $2 million. The suit was brought on by CBS as it relates to Howard Sterns radio program. It looks like it's a small price to pay to get CBS out of their hair.
Hank Paulson, the man who brought tremendous value and investor confidence to Goldman Sachs (NYSE: GS) has been chosen by President Bush to replace current U.S. Treasury Secretary John Snow. He is the latest in a line of Goldman Sachs Alumni to head to Washington D.C. The only question left is what is the impact going to be on Goldman Sachs itself with Paulson not at the helm any longer.
It looks like the CEO of General Motors (NYSE: GM) Rick Wagoner may be putting his blood and soul into the rebuilding of GM as he may be giving up his day to day duties. According to reports GM is set to appoint Troy Clarke, who is currently head of GM's Asia-Pacific operations, to run the North American unit. This could be a key move for GM as they are on the road to recovery despite recent analyst downgrades. Movers and Shakers
Some major movers in Fridays trading session include Navistar International (NYSE: NAV) which traded up $4.16 to close at $29.10, Las Vegas Sands (NYSE: LVS) traded up $5.96 to close at $69.63 as they secured the permission to build Singapore's first Casino Resort, Fedders Corp (NYSE: FJC) traded up 22 cents to close at $2.80, NWH, Inc (NASDAQ: NWIR) traded up $4.29 to close at $17.80, Hummingbird (NASDAQ: HUMC) traded up $4.78 to close at $27.90, Cubist Pharmaceuticals (NASDAQ: CBST) traded up $430 to close at $25.55 on very light volume, Cyberonics (NASDAQ: CYBX) traded up $3.66 to close at $26.27 and Infosonics (AMEX: IFO) one of "Wall Street to Main Streets" "Furious Five" stocks that were featured just continues to surge, as the stock traded up another $3.40 on Friday to close at $24.90 and going.
Downers
Due to market conditions we found it necessary to make our readers/listeners aware of companies that have been taking a little spanking, some of these stocks may be at a discount but you need to do your research, look at the charts and make sure that nothing fundamentally has changed with the company and whether it is just being dragged by the market or not. There are companies that are actually a slave to the Dow and present buying opportunities.
Some stocks that traded down on Friday include Rex Stores (NYSE: RSC), which traded down $1.58 to close at $16.03 after the company reported lower than expect earnings for the quarter.
Pegasus Wireless Corp (NASDAQ: PGWC), which was just bumped up from the OTC Bulletin Market to the Nasdaq in April, has been under pressure. The stock traded down $2.01 on Friday to close at $11.14. Since its listing on the Nasdaq the stock has fallen from the high $16 range to where it is now. The company is dead center in the wireless industry and this recent slide could be attributed to investors that held the stock while it was on the OTCBB jumping ship. Keep in mind when a stock makes a move from the OTCBB to the Nasdaq or AMEX they still have some baggage, so this shaking of the tree may present an opportunity to investors once the wave settles down a bit.
Fragrance retailer and wholesaler, eCom Ventures (NASDAQ: ECMV) has been sliding downward for the month of May 2006. Going from a high of $23.20 to where it is now. They recently faced a stock dumping from its former CEO Ilia Lekach and the recent offer of a buyout of the company by its founder Rachmil Lekach. He offered $25 a share but he could not provided proof that he could actually fund the deal. With sales of $233 million and net income of $4.23 a share, the company is sitting with a P/E of a little over 3. The stock is at the bottom of its trading range and presents a great opportunity for bottom fishers to acquire cheap, really cheap stock. The stock closed at $16.19 on Friday, it's 52 week low is $10.04.
Other stocks that traded down on Friday include Lyon Williams Homes (NYSE: WLS) which traded down $10 to close at $112, Schiff Nutrition (NYSE: WNI) traded down 56 cents to close at $6.37 on very little volume, Credence Systems (NASDAQ: CMOS) traded down $1.83 to close at $4.57, Siliconeware Precision (NASDAQ: SPIL) traded down 42 cents to close at $6.18 and Geoglobal Resources (AMEX: GGR) which traded down 74 cents to close at 5.58. Analyst Upgrades/Downgrades Recent Analyst upgrades include Sirius Satellite Radio (NASDAQ: SIRI) they were upgraded to an Overweight from an Equal Weight by Lehman Brothers as they stock has been dragged down by the negative attention given to XM Satellite Radio (NASDAQ: XMSR), Sun Microsystems (NASDAQ: SUNW) was upgraded to a Buy from a Neutral by UBS, JetBlue Airlines (NASDAQ: JBLU) was upgraded to a Neutral from Sell by Merrill Lunch, Newfield Exploration (NYSE: NFX) was upgraded to a Outperform from a Peer Perform by Bear Stearns, International Paper (NYSE: IP) was upgraded to a Buy from a Neutral by D.A. Davidson, E.W. Scripps (NYSE: SSP) was upgraded to a Buy from a Neutral by Merrill Lynch, and General Growth Properties (NYSE: GGP) was upgraded to a Buy from a Neutral by UBS.
Recent Analyst downgrades include Wyeth (NYSE: WYE) they were downgraded to a Neutral from a Buy by Merrill Lynch, Credence Systems (NASDAQ: CMOS) was downgraded to a Hold from a Buy by Canaccord Adams and to a Neutral from a Buy by Merriman, Curhan and Ford, Traffic.com (NASDAQ: TRFC) was downgraded to a Market Perform from a Strong Buy by JMP Securities, and Journal Register (NYSE: JRC) was downgraded to a Sell from a Neutral by Merrill Lynch.
FURIOUS FIVE
The latest addition to our "Furious Five" companies that we see excelling in their industry in 2006 is Comtech Group (NASDAQ: COGO) it trades on the Nasdaq under the symbol COGO.
For our outlook, and other vital information on the companies that we feature as the "FURIOUS FIVE" on Wall Street to Main Street just subscribe for FREE at www.namcnewswire.com
We cannot stress enough that investors need to do their due diligence, call the companies, get the information, consult with your investment advisor and if you do not have one consider getting one. Put the same time into investigating these companies as you do when you go to purchase a new television, it's only for your protection. When it comes to thinly traded securities stagger your orders or put a limit order in to avoid a run up. NAMC Newswire Note Go to the NAMC Newswire for updates at www.namcnewswire.com and you can listen to the NAMC Radio for the audio version of "Wall Street to Main Street" at www.namcnewswire.com/namcradio
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Louis VictorNAMC Newswire888-463-9237
Disclaimer:None of the information contained on the NAMC Newswire constitutes a recommendation by the NAMC Newswire, its journalist, nor its parent company that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific investors or person. Each individual investor must make their own independent decisions regarding any security, portfolio of securities, transaction, or investment strategy featured on the NAMC Newswire or NAMC Radio Any past results are not necessarily indicative of future performance. The NAMC Newswire, its journalist nor its parent company does not guarantee any specific outcome or profit, and all investors should be aware of the real risk of loss in following any strategy or investments featured on the NAMC Newswire or the NAMC Radio. The strategy or investments discussed may fluctuate in price or value and investors may get back less than you invested. Before acting on any information featured on the NAMC Newswire website or the NAMC Radio segment, investors should consider whether it is suitable for their particular circumstances and strongly consider seeking advice from their own financial or investment adviser. Investors are also urged to do their own due diligence before investing in any security. All opinions featured on the NAMC Newswire or NAMC Radio are based upon information that is considered to be reliable, but neither the NAMC Newswire, its journalist, its parent company, affiliates nor assigns warrant its completeness or accuracy, and it should not be relied upon as such. The statements and opinions featured on the NAMC Newswire by its journalist are based on their outlook at the time of the statement or opinion, and are subject to change without notice. NAMC may at times hold a position in the companies that it features, in these cases appropriate disclosure is made.
About the Author
Louis Victor is the host of the syndicated radio show and financial newsletter "Wall Street to Main Street" which is featured on the NAMC Newswire Radio. He has been involved in the financial industry for over two decades, on the retail and investment banking ends. He is also well versed in the advertising and marketing industries, which has given him insight into market trends and unqiue companies that may be under the radar.
