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Monday, August 21, 2006

Market Wrap (August 21, 2006)

Stock Tickers: BMY, LZB, F, DVAX, ERTS, OLAB, AU, ICON, GKIS, GLB, LOW, HD, BP, KNSY, STAR, RARE, MRGE, SNDK, GOOG, DG.

DJIA 11,345.05; Down 36.42 (0.32%)
NASDAQ 2,147.75; Down 16.20 (0.75%)
S&P500 1,297.52; Down 4.78 (0.37%)
10YR-Bond 4.819%

Today was sort of down on oil price concerns, but all in all this was just a dead August trading with extremely light trading volume and what media would normally call profit taking. Bank of America trimmed its equity allocations by 5% today and Iran has many reports saying that they are not allowing in inspectors and will violate a UN mandate by proceeding with its own nuclear energy program.

Despite being noted in papers and research notes as being a takeover candidate, Bristol-Myers Squibb (BMY) fell 0.3% to $21.56 as investors doubted the likelihood of an imminent deal.

The largest analyst call of the day was the Strong Buy rating from Raymond James on La-Z-Boy (LZB), with LZB trading up over 6% to $14.66.

Ford (F) fell 6.6% to $7.47 after a downgrade to Underperform from Credit Suisse and after formally lowering production targets.

Dynavax Technologies Corp. (DVAX) rose 4.7% to $4.17 after releasing positive early flu trial results.

Despite a positive analyst note from American Technology Research and licensing the Epic Games Unreal 3 gaming engine, shares of Electronic Arts (ERTS) fell 2.5% to $50.01.

OraLabs (OLAB) was the winner of the day. Its shares rose a sharp 100%, yes one-hundred percent, to $6.66 after announcing a surprise EPS number of $0.10 on Friday evening.

AngloGold Ashanti (AU) shares rose 4% to $50.10 on talk of overseas gold buyers interest in names.

Iconix (ICON) rose 3.4% to $14.99 after it announced it had acquired the London Fog brand name in a deal valued at merely $37.5 million, which the street felt was a steal.

Gold Kist (GKIS) rose a sharp 47% to $19.02 after getting a $20.00 buyout offer from Pilgrims Pride (PPC) in a buyout; shares of PPC rose 5% to $24.96.

Glenborough Realty Trust (GLB) rose a over 7% to $25.97 after a Morgan Stanlet affiliated unit made an acquisition of the REIT for $1.9 billion that placed a $26.00 cash buyout price.

Shares of home improvement center Lowe's (LOW) fell 3.9% to $28.37 after reporting EPS of $0.60 versus a consensus $0.61 estimate. This also brought shares of Home Depot (HD) down $34.31.

The Alaska Attorney General sent a subpoena to BP (BP) to try to determine what the company knew about the corrosion in the Prudhoe Bay pipeline, but higher oil prices helped the shares gain 0.3% to $70.21; Goldman also raised BP to a Neutral rating.

Despite posting EPS of $0.26 versus $0.25 estimates, the outlook provided by Kensey Nash (KNSY) pushed its shares down

Lone Start Steakhouse (STAR) rose another 1% to $27.46 the trading day after a Dallas private equity group offered to acquire the company. Conversely RARE Hospitality (RARE) closed down 3% to $28.11 and OSI Restaurant (OSI) fell 1.8% to $29.50.

Merge Tech (MRGE) saw its shares fall 7% to $7.14 after it said its interim CEO is leaving the company.

SanDisk (SNDK) rose a mere 0.3% to $51.36 after debuting a new MP3 player to compete with Apple's iPod, while AAPL fell 2% to $66.55 on a thinner than average trading volume day.

Google (GOOG) fell 1.6% to $377.17 after online media reports that it may have seen the first online market share drop in online search in the month of July.

Dollar General (DG) fell 9% to a new 52-week low of $12.73 after issuing an earnings warning friday evening.

Jon C. Ogg
August 21, 2006
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