GameStop Corporation ( GME ), the leading video game and entertainment software retailer, recently reported fourth-quarter 2009 results that came a penny ahead of the Zacks Consensus Estimate, but fell year-over-year. The quarterly earnings of $1.29 per share beat the Zacks Consensus Estimate of $1.28 marginally, but dropped 3.7% from $1.34 delivered in the prior-year quarter due to an increase in SG&A expenses (up 11.5%) and a rise in depreciation and amortization (up 13.9%), partially offset by a marginal increase in the top-line, a slight dip in the cost of sales (0.1%) and a major drop in interest expense (20.9%). Despite a fall in the bottom-line, the Grapevine, Texas-based company expects its earnings to rebound in fiscal 2010. GameStop now expects first-quarter 2010 earnings between 46 cents and 48 cents a share, reflecting a year-over-year increase of 7% to 12%, and fiscal 2010 earnings between $2.58 and $2.68, depicting a rise of 14% to 18%. The current Zacks Consensus Estimate for first-quarter and fiscal 2010 are 47 cents and $2.59 per share, respectively. Shares of GameStop rose an impressive 6.55% ($1.30 per share) in Thursday trading. Revenue for the quarter rose marginally by 0.9% to $3,524 million, following an increase of 8.2% in third-quarter 2009. For fiscal 2010, management expects a revenue growth of 4% to 6%. By sales mix, new video game hardware sales fell 9.2% to $

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GameStop Earnings Drop, Stock Up – Analyst Blog

Ratings agency Fitch Ratings has assigned a “BB+” rating to United States Steel Corporation’s ( X ) $500 million debt issued recently, reports AP. According to Fitch, “BB+” rated debt is non-investment grade or junk bond and is more vulnerable to changes in the economy. The company plans to use the proceeds from the notes due 2020 for general corporate purposes. Fitch had earlier downgraded US Steel’s rating on similar debt to “BB+” from “BBB-“, citing a lack of visibility of both an economic recovery and the company’s return to profitability. The downgrade included the possibility that the company, one of the world’s largest steel producers, would need financing in the near term for part of its capital spending over the next two to three years. However, Fitch’s rating outlook on US Steel is “stable”, reflecting the agency’s view that the company’s liquidity is sufficient to support operations, should the recovery remain weak for the next few months. In contrast to Fitch’s downgrade, Moody’s Investor Services ( MCO ) has upgraded the ratings on US Steel’s senior unsecured notes, pollution control revenue bonds and convertible notes due 2014 to “Ba2″ from “Ba3″. The agency seems to be more positive on US Steel’s  capital structure changes, which now has a lower proportion of secured debt and administrative and priority claims in total liabilities. Moody’s judges obligations rated “Ba” to have questionable credit quality. Moody’s has also affirmed the company’s “Ba2″ corporate family rating and the probability of a default rating. The upgrade on the corporate family rating is driven by Moody’s expectation of an improvement in US Steel’s debt protection and leverage ratios this year, although it expects the ratios to continue to be relatively weak. The rating outlook remains “negative.” Zacks Recommendation US Steel’s debt-to-equity ratio has remained above 65% in the last three quarters. As of December 31, 2009, long-term debt totaled $3.35 billion. The company’s net cash position (total cash less long-term debt) as of December 31, 2009 was a deficit of a significant $2.13 billion or $15.8 per share. Yet, the long-term positive outlook for steel makes us optimistic. We believe that US Steel is poised to show significant improvement in margins and profitability in the coming quarters. Raw material costs for steelmaking are rising, and US Steel is a leading beneficiary of this trend because of its integrated business model. The company’s capacity utilization rates have improved faster than expected, following the recent restart of its blast furnaces. Of its 15 idled furnaces, 13 are now up and running. We believe that improving capacity utilization should return the company to

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US Steel: More Debt, Same Rating – Analyst Blog

On Tuesday, CIT Group Inc. ( CIT ) reported a net income of $3.2 billion, including the reorganization benefit under the post-bankruptcy accounting known as Fresh Start Accounting (FSA). Excluding special accounting procedures and other items related to its reorganization, its quarterly pre-tax loss was $1 billion. Results reflected low finance revenue as well as high borrowing and credit costs, primarily in Corporate Finance segment of the company.  CIT’s commercial net charge-offs, which reflects loans that the company no longer expects to be repaid, totaled $385 million or 4.77% of average finance receivables. Before FSA, allowance for loan losses totaled $1.8 billion at Dec 31, 2009, up significantly from $1.1 billion at Dec 31, 2008. Overall credit metrics weakened considerably. Net charge-offs increased largely reflecting the deterioration from the slow economy, high unemployment and constrained market liquidity. This impact was most notable in specific industries within Corporate Finance segment of the company.  Besides, under its reorganization plan, CIT canceled its common stock and issued new shares. Using previous shares outstanding, the company reported loss of $3.8 million or a penny per share in 2009, compared to $2.9 billion or $11.06 per share in 2008. Excluding reorganization and FSA adjustments, net loss was $4.1 billion in 2009.  At Dec 31, 2009, CIT had total cash of $9.8 billion, while consolidated Tier 1 and Total capital ratios were 14.2 %.  Business

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CIT Posts Loss on Higher Costs – Analyst Blog

Isis Pharmaceuticals, Inc. ( ISIS ) and Genzyme Corp. ( GENZ ) recently announced the publication of phase III data on mipomersen in The Lancet. The data was published from a study that was conducted in patients with homozygous familial hypercholesterolemia (hoFH).  Results, which were presented at the annual American Heart Association meeting in November 2009, showed that mipomersen met its primary endpoint. The candidate achieved a 25% reduction in low-density lipoprotein – cholesterol (LDL-C) in an intent-to-treat analysis.  Besides meeting the primary endpoint, the study also met each of its secondary and tertiary endpoints, which included statistically significant reductions in apolipoprotein-B, total cholesterol, non- high-density lipoprotein (HDL) cholesterol, lipoprotein (a) [Lp(a)], very low density lipoprotein-cholesterol (VLDL-C) and triglycerides.  Mipomersen is Isis’ lead pipeline candidate. It is an antisense drug that targets apolipoprotein B (apoB) -100, which is critical to the synthesis and transport of low density lipoprotein (LDL) or bad cholesterol. By potentially knocking out the apoB-100 protein via antisense technology, Isis scientists believe they can effectively lower the cholesterol of patients and reduce the risk of serious cardiovascular disease.  Genzyme intends to file for approval in the U.S. and EU in the first half of 2011 for the treatment of patients with homozygous FH (hoFH), which represents a much smaller patient population. hoFH is a very rare condition that is estimated to affect about 1 in a million people.  Given the novel mechanism and narrow initial market focus of homozygous (Ho) FH, the US Food and Drug Administration (FDA) granted mipomersen orphan drug status.  Isis and Genzyme stated that

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Isis Drug Phase III Data Published – Analyst Blog

Validus Holdings, Ltd. ’s ( VR ) MACD indicator has moved into bearish territory with a reading of -0.1673. The Zacks #4 Rank (“Sell”) stock declined slightly to $25.84 in morning trade. The Zacks Consensus Estimate on the company’s earnings for 2010 has reduced by 93 cents over the past week to $3.48 per share. “VR” Free Stock Analysis: Buy? Sell? Hold? Zacks Investment Research

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Bearish MACD for Validus – Zacks Tale of the Tape

Here at Wealth Daily , we’re in the business of finding the next big thing… The next sector to short before a crash… The next wonder-drug to get FDA approval… The next economic event that will send metals higher. These are all catalysts for superb money-making opportunities. And the editors here make it their mission to find the next catalyst in their area of expertise before anyone else does. Options. Biotech. Gold. Energy. We have experts covering these niche sectors in great detail. Each knows what makes his sector move; what start-ups to look out for; what news makes companies in his universe respond. We use that expertise to find the next big thing for our readers — the next single play that could quickly double your money or better. And we produce those big winners frequently. That’s why our loyal readership numbers in the hundreds of thousands… and growing. That’s why millions of people — including brokers and analysts — constantly browse these pages for tips and insights. Advertisement “The # 1 Oil Play in the Country” With the rest of the nation in recession, one state is enjoying a real live oil boom. It’s all happening in North Dakota, where the Bakken — a massive oil formation — has already become a major force in our domestic energy picture. And now, geologists tell us, we may be looking at a “second Bakken”… one that could easily double the Bakken’s 4.3 billion barrels of recoverable oil. Read on to learn more about what’s being called “the #1 oil play in the country”… and the profit-making stocks behind it. Ways to Make Money When you focus on a specific sector — or on a particular style of analysis — for any extended period of time, you find different ways to make money in the short term. You can trade the news, play volume, bet on earnings, follow insiders, etc. These are the things we look at in order to make money for our readers. And one of the things we’ve had great success with recently is playing exchanges. Here’s what I mean… Stocks trade on different exchanges. There are junior exchanges, like the Bulletin Board and the Pink Sheets. And there are senior exchanges, like the New York Stock Exchange (NYSE) and the NASDAQ, no longer considered an acronym. History has…

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The European Automobile Manufacturers’ Association has revealed that automakers in the European Union should expect to face slumping sales in 2010 on top of a 17% decline in sales to 15.2 million vehicles in 2009 as the industry has yet to recover from the global economic crisis. The decline in sales will be more pronounced for passenger cars, especially in countries where fleet renewal schemes have ended, while commercial vehicle registrations are expected to be flat. In 2009, truck production in Europe fell 64% to an historic low. Meanwhile, passenger car output dipped 13% to 13.4 million units — the lowest since 1996 — partly offset by a favorable effect from scrappage schemes. Many European automakers suffered a loss during the year. Daimler AG ( DAI ) lost €2.6 billion ($3.7 billion) or €2.63 ($3.67) per share in 2009, in sharp contrast to a profit of €1.4 billion ($2 billion) or €1.41 ($1.97) per share in the previous year. The loss was attributable to a 24% decline in unit sales to 1.6 million vehicles due to the global economic crisis. Revenue for Daimler dipped 20% to €78.9 billion ($110 billion); adjusted for exchange-rate effects, the decrease was 21%. Bayerische Motoren Werke AG (BMW) reported a 36% drop in profit to €210 million ($286 million) for 2009. Revenue shrunk 4.7% to €50.68 billion ($69 billion) as the economic crisis hurt demand for luxury cars. Volkswagen AG recorded an 80% fall in net profit to €960 million ($1.3 billion) during the year. Read the full analyst report on “DAI” Zacks Investment Research

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European Autos to Face Lower Sales – Analyst Blog

Earnings estimates for Cephalon, Inc. ( CEPH ) have gone up significantly following the issuance of a better-than-expected guidance by the company. Cephalon exited 2009 on a strong note with both fourth-quarter and full-year earnings exceeding expectations. Cephalon reported fourth-quarter earnings of $1.66 per share, up 13.7%, and full-year earnings of $6.03, up 25%.  Top-line performance also remained strong with fourth quarter revenues increasing 6.5% to $575.1 million, and full year revenues increasing 11% to $2.2 billion. Revenues were primarily driven by contributions from the central nervous system (CNS) and oncology franchises.  Guidance and Earnings Estimate Revisions   Cephalon’s guidance for 2010, which was re-issued following the company’s decision to acquire generic company Mepha, was well above expectations and resulted in several analysts raising their earnings estimates for the stock.  Earnings estimates for 2010 have gone up by 27 cents over the past 30 days to $6.51 with 19 of 21 analysts following the stock raising their estimates. Only 2 analysts moved in the opposite direction during this period.  The Mepha acquisition, which is scheduled to close on Apr 1, is expected to be accretive to earnings immediately. This acquisition will not only allow Cephalon to enter the generics drug market, it will also allow the company to expand its footprints in ex-US territories including emerging markets which represent significant opportunity for growth.  Cephalon expects total sales to increase 19% – 23% to $2.61 – $2.69 billion in 2010. Revenues should be boosted by strong conversion of the CNS franchise and continued robust performance of the oncology franchise.  CNS franchise sales are expected in the range of $1.18 -$1.22 billion in 2010. Cephalon has undertaken several measures to ensure the smooth transition of patients from Provigil to Nuvigil. In addition to being priced at a significant discount to Provigil, a co-pay assistance program has also been introduced to help reduce the financial burden on patients.  Cephalon has also launched a new marketing campaign that is focusing …

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Cephalon Ests Up on Guidance – Analyst Blog

Getting from point A to point B in the real world can be quite simple. In the investment world, the roadways are constantly shifting. Changes in interest rates, tax policies, unemployment, fiscal initiatives can represent obstacles and navigating these winding paths can require your very own GPS advice. Words: 494

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Norwegian oil major Statoil ASA ( STO ) has increased its interest in the St Malo development region. St Malo is a major discovery in the ultra-deep waters of the Gulf of Mexico (GoM). Statoil has exercised its preferential rights on a proposed sale of Devon Energy ’s ( DVN ) interest in the development. Following the deal, Statoil’s interest stood at 21.5%. St Malo is operated by Union Oil Company of California, a subsidiary of Chevron Corporation ( CVX ). The St Malo discovery, commonly known as the Paleogene play, is in the lower tertiary trend of the deepwater GoM. Statoil is the third-largest stakeholder in this play. Due to its strong offshore exposure, Statoil is a leader in subsea production. It brings in technology and extensive offshore expertise, which will benefit the development of this play. Production growth from international operations is a key component of Statoil’s overall annual upstream growth plans over the next few years, and an increase in St Malo working interest coincides with these plans. Apart from the GoM, the company has a growing upstream presence in the emerging basins of the Caspian Sea and West Africa. We are currently Neutral on Statoil and view the company as a stable and secure source of energy in a global oil patch. Statoil remains focused on improving ROCE (returns on capital employed) by maintaining disciplined capital outlays and reducing operating costs. “STO” Free Stock Analysis: Buy? Sell? Hold? “DVN” Free Stock Analysis: Buy? Sell? Hold? “CVX” Free Stock Analysis: Buy? Sell? Hold? Zacks Investment Research

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Statoil Gaining Impetus at St Malo – Zacks Tale of the Tape

Norwegian oil major Statoil ASA ( STO ) has increased its interest in the St Malo development region. St Malo is a major discovery in the ultra-deep waters of the Gulf of Mexico (GoM). Statoil has exercised its preferential rights on a proposed sale of Devon Energy ’s ( DVN ) interest in the development. Following the deal, Statoil’s interest stood at 21.5%. St Malo is operated by Union Oil Company of California, a subsidiary of Chevron Corporation ( CVX ). The St Malo discovery, commonly known as the Paleogene play, is in the lower tertiary trend of the deepwater GoM. Statoil is the third-largest stakeholder in this play. Due to its strong offshore exposure, Statoil is a leader in subsea production. It brings in technology and extensive offshore expertise, which will benefit the development of this play. Production growth from international operations is a key component of Statoil’s overall annual upstream growth plans over the next few years, and an increase in St Malo working interest coincides with these plans. Apart from the GoM, the company has a growing upstream presence in the emerging basins of the Caspian Sea and West Africa. We are currently Neutral on Statoil and view the company as a stable and secure source of energy in a global oil patch. Statoil remains focused on improving ROCE (returns on capital employed) by maintaining disciplined capital outlays and reducing operating costs. Read the full analyst report on “STO” Read the full analyst report on “DVN” Read the full analyst report on “CVX” Zacks Investment Research

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Statoil Gaining Impetus at St Malo – Analyst Blog

Macroeconomic growth has room for positive surprise, as governments focus on fixing fiscal imbalances, and as money rates remain low, James Bevan from CCLA Investment Management said Friday. Growth to Surprise to the Upside: CIO

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Growth to Surprise to the Upside: CIO