My Own Analyst

SCVL: 52-Week High

The falling energy prices are friendly to the SCVL customer.  The stock has moved to a 52-week high.  The valuation is low enough that I think it can run some more.  The obvious target is 33.50-35, and area reached briefly in 2007...

SOLR Follow-Up

This move could have legs.  I quickly reviewed some history - interesting company.  They are actually changing their name this summer to GT Advanced Technologies, which is reflective of the increasing diversity of their business.  I don't know what the time-frame is for the big order today from a Chinese start-up on the LED sapphire oven, but their backlog will now be 50% LED.  Unlike solar, LED is economically viable without subsidy.  I still don't quite understand why this stock, which has net cash and minimal CapEx requirements, is so inexpensive.  On the surface, it looks like solid fundamentals, a great chart and very cheap valuation.

WAG S-S-S Strong

Walgreen same-store-sales came in at 5.6% - pretty decent.  The increase was balanced - more people, more items, higher prices.  Note that this is the first month where Duane Reade sales are included in the same-store base, as the acquisition closed over a year ago.  The stock has held in fairly well since GS took them off their Focus list (but retained a Buy).  The company reports 6/21, and I continue to like this name s.t. and longer-term (target is 56).

ESL Post-Call

In case you are long the stock, you might want to sell into strength.  If you aren't long, don't chase!  This is a tough market and could be getting more dangerous (too early to make that call).  The call went well, but there was a one-time item that takes away just partially (a price correction from Boeing).  I expect that this stock will do very well over the next year, riding good fundamental trends and a smart acquisition that closes in July.  With that said, the stock is likely to run into profit-taking in the near-term as investors ponder "tough comparisons" in the core business for Q4.  I would prefer to play this (still) from the accumulate position.  My guess is that it tests 80 before reversing back towards 75...

ESL Kills It

I have been highlighting ESL as one I like - wish I had included it in the Top 20.  I am not sure that the call will add much to the press release, but I will update if I learn anything further.  Sales came in 5% above expectations and grew 13.8%.  EPS were supposed to be 1.10 but were 1.47, up 50% from  a year ago.  All 3 segments were strong.  They raised guidance to 4.80-4.95 (consensus was 4.83), from 4.55-4.80 after last quarter.  Note that the company also expects the acquisition to add about .10 to FY11.

ESL Reports Today

I have been favoring this name for some time, sharing my positive thoughts after their recently announced acquisition.  The company reports this afternoon - I currently am carrying a target of 96 a year from now.  Nice chart (consolidating up) - looks like a breakout in action...

TECD Posts Strong Quarter but Slight Miss

TECD reported sales of $6.33 billion, which were up 13% (10% excluding currency impact) but slightly below the $6.4 billion consensus.  EPS of $1.03 per share were up 17% but just shy of the $1.05 consensus. 

I will report back after the call, but it appears that the operating margin in Europe took a slight step back, falling from .88% a year ago to .81%.  Sales in Europe, which represent 59% of overall sales, grew 18% (14% local currency).  Sales in the Americas grew 6%, and the OM was 1.83% compared to 1.8% a year ago.  Overall, GM improved from 5.21% to 5.27%, but SG&A increased from 3.97% to 4.07%. 

To me, the quarter was fine (especially in light of what IM reported), but I can see how the stock, which is near its highs still, may see some profit-taking.  Inventory and AR rose, with the company actually using a small amount of cash in its operations.  The company ended with $325mm net cash after repurchasing $51mm in stock (1/2 of what it had authorized in March).  The cash works out to about $7 per share.

BEN Assets Reported

In April, BEN AUM grew rather sharply, reported at $733 billion, up from $703 bln a month ago and from $602 bln a year ago.  I felt kind of funny today trimming it in Top 20 (to add to IIIN), especially as we added to it in CG/B on Friday.  It's still above average.  This report could propel it to new highs.

Sequentially, all categories increased.  Equity was up over 5%, with the bulk of the gains in Global/Intl (my buy thesis).  Hybrid was up marginally.  Tax-free ticked up (the market's recovering) and global taxable bonds were very strong (up 7.5% in a month).  The global stocks and bonds total over $408 billion of the $733 billion now.  At year-end it was $364 billion of $671 billion, and it March it was $386 billion of $703 billion.  A year ago, it was half the $602 billion, and most of the growth has come on the bond side for international.  So much for all those worries over bonds a few months ago...

ISurge?

ISRG had very strong sales growth but the earnings growth, though strong, was only marginally better than expected.  The instruments sales were smoking hot, and this is the key number in my view.  I am sure that some will be cautious on the unit growth (only 8%) and the lowered guidance on GM (to low-end of 72-73 range), but the stock looks to me to be on track for a march to 450.  Sounds great, but that's just 25%, so I am not buying, but it does look good to me.

Speaking of Healthcare

Earlier this year, I punted STJ out of the Top 20.  So far, not too big a deal (we sold at 46.50), but it may not have been such a good move.  I recently reexamined my valuation target and think that the stock could be close to $68 a year from now as the PE expands to 18.  The stock broke out from a multi-year consolidation.  My short-term concerns are based on it being somewhat extended.  Here is the current chart - it's a "black 1".  On a consolidation near 48-50, I would hope to get back in.