Stock of the Day
at 2006-04-04 01:40:34
Shares of SiRF Technology (SIRF) are strong again today, up +3% to $39. Brokerage firm Soleil came out with a note this morning about the strong quarter they believe GPS-maker Garmin (GRMN) is experiencing.
Given the rate at which GRMN is designing SIRF chipsets into its products, the firm thinks that SIRF could also be tracking to a better-than-expected quarter. They posit that SIRF could be tracking as high as 40-50% of GRMN's unit volume, above the firm's estimates of 35%.
GRMN's stock has been on fire recently. Competitor TOM Online (TOMO) is now close to breaking to new highs as well. I think all of this competition in the GPS market bodes well for SIRF, and I am looking for it to break to new highs.
long SIRF
Hurry Up and Wait
at 2006-04-04 01:40:34
The market opens mixed this morning, with the Nazz slightly higher and the SPX down a touch. Of course, the early action means very little today, as the market waits for the announcement from the FOMC later today. The statement they put out will be closely scrutinized, and likely lead to some volatile action in the final 90 minutes of trading.
Oil is up again today, above $64, and that has the energy stocks catching a bid. Bond yields are also higher, with the 10-year yield moving up to 4.73%. The bond market should also have a strong reaction to the FOMC announcement, especially if the Chairman gives any hints about being closer to the end of the rate hikes.
Energy stocks and homebuilders are up in early trading, while consumer staples and utilities are under pressure.
Morning News
at 2006-04-04 01:40:34
Morning News of Note:
-
C: Citigroup Likely To Make a Play For Turkish Bank Citigroup Inc.'s Charles Prince is considering making a big bet on Turkey. A year after the Federal Reserve effectively barred Citigroup from doing any "significant" merger deals, the Citigroup chief executive is expected to submit a final cash bid to acquire some or all of Finansbank, Turkey's eighth-largest bank by assets, in a transaction that could be valued at $5 billion or more, according to people familiar with the matter (Full Story) WSJ
-
CME: Oil Fight: CME to Launch Its Own Energy Futures The Chicago Mercantile Exchange said it plans to launch a raft of energy-futures products in June, targeting the market share of the New York Me
SiRF dowgraded
at 2006-04-04 01:40:34
SiRF Tech ( Nasdaq:SIRF) was downgraded this morning at Morgan Stanley. The analyst thinks that the company could experience decelerating growth in 2006, which would hurt the stock due to its rich valuation.
He also thinks that the company will ramp its investments in handsets, autos, notebook PCs, gaming, and digital cameras. The increased investments could limit upside to EPS, with the payoff not beginning until 2007. He is not predicting a bad year for SIRF in 2006, but just one that may not live up to lofty investor expectations.
I am not sure that I fully agree with the analyst, as I think the strength of the PND market and at companies like GRMN remain strong. I do agree that expectations are lofty though.
The stock has gapped down roughly -5% today, on rising volume. But the stock is still above its 50-day ma. I have been looking for SIRF to make new highs
Ugly Reversal at 2006-04-04 01:40:34
The market was trading nicely higher going into the FOMC meeting, but ended the day sharply lower. It wasn't as if anything surprising came out of the meeting. The wording of the announcement that gets released after the meeting was essentially the same as the last meeting. I guess more people were hoping for some hints that the Fed was nearer to the end of its rate hike campaign.
This was the 15th consecutive rate hike by the Fed, bringing the fed funds rate to 4.75%. Fed funds futures are forecasting an 80% certainty that the Fed raises again in May to 5.0%.
Back on 3/21, I stated that the ugly LROD (large-range outside day) for the indexes was likely foreshadowing more weakness over the next weak or so. Today is the 5th session since, and the FOMC meeting proved to be the catalyst for the downside move. Regardless, both the SPX and COMP put in a second LROD today, on r
|
