MORNING COFFEE

Ford Offers Pension Buyout. For the first time Ford (F) is offering its former white-collar salaried retirees a lump-sum pension buyout offer. The offer is an attempt to reduce its underfunded $74 billion global pension liability.  Currently the plan is $15.4 billion short. 

98,000 salaried retirees and former white-collar workers will be eligible for the buyout which will be based on interest rates, life expectancy and actuarial tables the federal government uses to calculate pension obligations. 

Retirees have already begun receiving letters letting them know they are eligible for the lump-sum option.  By summer's end, 12,000 to 15,000 randomly selected workers will receive a second letter outlining the exact offers. The rest will be rolled out during the next 12 months. Upon receiving the second letter retirees will have 90 days to decide once they receive the offer.

Rick Paler President of RL Paler Investment Advisors, LLC a wealth management firm with offices in California and Michigan said “These retirees face a very big decision which cannot be taken lightly.” He went on to say “One needs to take into consideration the spousal benefits, tax implications, and estate ramifications.”  He recommends speaking to a qualified wealth manager or a CPA before making any decisions.

Upgrades

Facebook (FB): Bernstein raised their rating from Underperform to Market Perform and placed a target range of $23.00 to $25.00 on the company.

Downgrades

Dow Chemical (DOW): Argus lowered their rating from Buy to Hold. Pre-market: 28.70 -0.14 (-0.49%)

Las Vegas Sands (LVS): Argus lowered their rating from Buy to Hold. Pre-market: 37.13 -0.41 (-1.09%)

Coach (COH): Jefferies lowered their rating from Buy to Hold and lowered their target price from $92.00 to $55.00. Pre-market: 49.46 -11.12 (-18.36%)

Coach (COH): Piper Jeffray lowered their rating from Overweight to Neutral and lowered their target price from $80.00 to $67.00. Pre-market: 49.46 -11.12 (-18.36%)

Coverage Initiated

DirecTV (DTV): Jefferies initiated coverage with a Buy rating and target price of $59.00. Pre-market: 49.26 -0.07 (-0.14%)

DISH Network (DISH): Jefferies initiated coverage with a Hold rating and target price of $31.00. Pre-market: 30.63 -0.49 (-1.57%)

Earning Reports

Cirrus Logic (CRUS): Reported EPS of $0.22 beating estimates by +$0.01. Pre-market: 35.90 +6.06 (20.31%)

Eastman Chemical (EMN): Reported EPS of $1.40 beating estimates by +$0.10.

Aetna (AET): Reported EPS of $1.31 beating estimates by +$0.06. Pre-market: 38.49 +1.35 (3.63%)

Archer-Daniels (ADM): Reported EPS of $0.38 missing estimates by -$0.23. Pre-market: 26.13 -1.36 (-4.95%)

Coach (COH): Reported EPS of $0.86 beating estimates by +$0.01. Pre-market: 49.46 -11.12 (-18.36%)

Delphi Automotive (DLPH): Reported EPS of $1.01 beating estimates by +$0.10. Pre-market: 29.00 +1.01 (3.61%)

Fresh Del Monte (FDP): Reported EPS of $1.01 beating estimates by +$0.12. Pre-market: 24.31 -0.03 (-0.14%)

Pfizer (PFE): Reported EPS of $0.62 beating estimates by +$0.08. Pre-market: 23.92 +0.21 (0.89%)

Teleflex (TFX): Reported EPS of $1.23 beating estimates by +$0.13.

U.S. Steel (X): Reported EPS of $0.69 beating estimates by +$0.21. Pre-market: 19.33 +0.41 (2.17%)

Markets: 
Futures at 7:00: Dow +0.25%. S&P +0.2%. Nasdaq +0.3%. Crude +0.2% to $89.92. Gold +0.2% to $1627.60.

Europe: London -0.4%. Paris +0.1%. Frankfurt +0.5%. 

Asia: Japan +0.69%. Hong Kong +1.08%. China -0.30%. India +0.54%. 

MORNING COFFEE

Q2 EPS and Q3 Estimates A Mixed Bag. With more than half of the S&P 500 companies reporting their Q2 earnings the quarter seems to have been a fairly decent one.  So far 65.96% of the companies have reported EPS the have beat Wall Street estimates, 21.63% have missed estimates and 12.41% have met their estimates.  But Wall Street traders have had some concerns with Q3 future guidance. Estimates for Q3 have steadily declined from 4.8% back in March to -1.6% currently.  The decline has occurred as worried traders watch Europe and China as their economies slow down.  The ratio of negative-to-positive Q3 forecasts is now the worst since 2001. 

Upgrades

Deere & Co. (DE): Piper Jaffray raised their rating from Neutral to Overweight and raised their target price from $85.00 to $93.00. Pre-market: 79.00 +0.90 (1.15%)

Helmerich & Payne (HP): Canaccord Genuity raised their rating from Hold to Buy. Pre-market: 49.10 +0.51 (1.05%)

Con-Way (CNW): Robert W. Baird raised their rating from Neutral to Outperform and raised their target price from $42.00 to $43.00.

Noble Energy (NBL): FBR Capital raised their rating from Market Perform to Outperform and raised their target price from $100.00 to $120.00. Pre-market: 89.55 0.00 (0.00%)

Arch Coal (ACI): Sterne Agee raised their rating from Neutral to Buy and placed a target price of $13.00 on the company. Pre-market: 7.17 +0.37 (5.44%)

Arch Coal (ACI): Global Hunter raised their rating from Neutral to Buy and placed a target price of $18.00 on the company. Pre-market: 7.17 +0.37 (5.44%)

Downgrades

JPMorgan Chase (JPM): Deutsche Bank lowered their rating from Buy to Hold and lowered their target price from $43.0-0 to $40.00. Pre-market: 36.58 -0.31 (-0.84%)

Electronic Arts (EA): Longbow lowered their rating from Buy to Neutral. Pre-market: 11.37 -0.04 (-0.35%)

Watson Pharmaceuticals (WPI): Sun Trust lowered their rating from Buy to Neutral. Pre-market: 79.77 0.00 (0.00%)

PETsMART (PETM): Nomura lowered their rating from Buy to Neutral and maintained a target price of $70.00. Pre-market: 67.89 -0.30 (-0.44%)

Coverage Initiated

United Technologies (UTX): JPMorgan Chase initiated coverage with an Overweight rating and target price of $98.00. Pre-market: 74.27 -0.01 (-0.01%)

Cirrus Logic (CRUS): Canaccord initiated coverage with a Buy rating and target price of $35.00. Pre-market: 29.73 +0.77 (2.66%)

Earning Reports

CIT Group (CIT): Reported EPS of -$0.35 beating estimates by +$0.14.

Diebold (DBD): Reported EPS of $0.49 missing estimates by -$0.09.

Franklin Resources (BEN): Reported EPS of $2.12 beating estimates by +$0.04. Pre-market: 112.21 0.00 (0.00%)

Loews Corp (L): Reported EPS of $0.14 missing estimates by -$0.61. Pre-market: 41.09 -0.61 (-1.46%)

Markets: 
Futures at 8:46: Dow -0.32%. S&P -0.24%. Nasdaq +0.11%. Crude -0.37% to $89.80. Gold -0.09% to $1616.50.

Europe: London +0.81%. Paris +0.57%. Frankfurt +0.87%. 

Asia: Japan +0.80%. Hong Kong +1.61%. China -0.89%. India +1.81%. 

We Support Our Clients In Their Pursuit Of Gold

I would like to wish my clients Jesse Williams, Michael Rodgers,Tiffany Porter and her husband Jeff Porter good luck in London. 

Special thoughts also go out to all the other athletes I know that worked so hard for this moment. 

MORNING COFFEE

Facebook Reports Earnings, Shares Dive On News. Facebook (FB) reported EPS of $0.12 beating Wall Street estimates by a penny, while revenue rose 32% to $1.18 billion.  When stock-based compensation, income tax and payroll tax adjustment are included the company lost -$157 million or -$0.08 per share, compared with earnings of $240 million a year ago. The company also didn’t provide future guidance which concerned traders about the company’s slower growth. Pre-market: 23.35 -3.49 (-13.02%)

Upgrades

Sprint Nextel (S): UBS raised their rating from Neutral to Buy and raised their target price from $2.50 to $6.00. Pre-market: 4.04 -0.01 (-0.25%)

Downgrades

General Electric (GE): Bernstein lowered their rating from Outperform to Market Perform and placed a target price of $22.00 on the company. Pre-market: 20.51 -0.05 (-0.24%)

Exxon Mobile (XOM): UBS lowered their rating from Buy to Neutral and placed a target price of $90.00 on the company. Pre-market: 86.25 -0.27 (-0.31%)

Unilever N.V. ADS (UN/UL): Natixis lowered their rating from Neutral to Reduce. UN Pre-market: 34.26 -0.02 (-0.06%), UL Pre-market: 35.28 -0.12 (-0.34%)

Unilever N.V. ADS (UN/UL): Societe Generale lowered their rating from Hold to Sell. UN Pre-market: 34.26 -0.02 (-0.06%), UL Pre-market: 35.28 -0.12 (-0.34%)

Boston Scientific (BSX): Northland Securities lowered their rating from Outperform to Market Perform and lowered their target price from $7.50 to $5.50. Pre-market: 5.00 +0.03 (0.60%)

Starbucks (SBUX): Robert W. Baird lowered their rating from Outperform to Market Perform and lowered their target price from $65.00 to $50.00. Pre-market: 47.10 -5.30 (-10.12%)

Coinstar (CSTR): Pacific Crest Baird lowered their rating from Outperform to Sector Perform. Pre-market: 51.20 -8.02 (-13.54%)

Coverage Reiterated/Price Target Changed 

Coinstar (CSTR): Compass Point reiterated their Neutral rating and lowered their target price from $70.00 to $60.00. Pre-market: 51.20 -8.02 (-13.54%)

Celgene (CELG): Rodman & Renshaw reiterated their Market Outperform rating and raised their target price from $76.00 to $79.00.

Earning Reports

Amazon.com (AMZN): Reported EPS of $0.01 in-line with estimates. Pre-market: 222.50 +2.49 (1.13%)

Amgen (AMGN): Reported EPS of $1.83 beating estimates by +$0.29.

Chubb (CB): Reported EPS of $1.37 beating estimates by +$0.23.

Coinstar (CSTR): Reported EPS of $1.25 beating estimates by +$0.06. Pre-market: 51.20 -8.02 (-13.54%)

Facebook (FB): Reported EPS of $0.12 beating estimates by +$0.01. Pre-market: 23.35 -3.49 (-13.02%)

NETGEAR (NTGR): Reported EPS of $0.64 missing estimates by -$0.04. Pre-market: 28.50 -6.50 (-18.57%)

Starbucks (SBUX): Reported EPS of $0.43 missing estimates by -$0.02. Pre-market: 47.10 -5.30 (-10.12%)

Triumph Group (TGI): Reported EPS of $1.48 beating estimates by +$0.21.

Markets: 
Futures at 8:13: Dow +0.35%. S&P +0.41%. Nasdaq +0.49%. Crude +0.39% to $89.74. Gold +0.76% to $1627.30.

Europe: London +0.24%. Paris +1.36%. Frankfurt +0.48%. 

Asia: Japan +1.46%. Hong Kong +2.02%. China +0.13%. India +1.20%. 

MORNING COFFEE

Apple Misses Wall Street Estimates. Apple (AAPL) reported FQ3 EPS of $9.32 missing Wall Street estimates by -$1.06. Revenues at the company came in at $35 billion. Apple also issued FQ4 guidance of $7.65 and $38 billion which was also below consensus estimates. Sales of iPads rose 44% to 17 million, but iPhone sales fell to 26 million from 35 million. Pre-market: 572.50 -28.42 (-4.73%)

Upgrades

Amgen (AMGN): Credit Suisse raised their rating from Neutral to Outperform and placed a target price of $85.00 on the company. Pre-market: 77.55 +1.18 (1.54%)

Chipotle Mexican Grill (CMG): Miller Tabak raised their rating from Hold to Buy and placed a target price of $350.00 on the company. Pre-market: 298.00 +3.69 (1.25%)

Buffalo Wild Wings (BWLD): B. Riley raised their rating from Neutral to Buy and raised their target price from $72.00 to $83.80. Pre-market: 70.10 -8.80 (-11.15%)

Dole Foods (DOLE): Bank of America / Merrill Lynch raised their rating from Underperform to Buy and raised their target price from $9.00 to $12.00. Pre-market: 9.94 +0.23 (2.37%)

Downgrades

Apple (AAPL): Raymond James lowered their rating from Strong Buy to Outperform and lowered their target price to $730.00. Pre-market: 572.50 -28.42 (-4.73%)

Netflix (NFLX): SunTrust lowered their rating from Strong Buy to Neutral. Pre-market: 64.44 -15.95 (-19.85%)

RF Micro Device (RFMD): Northland Securities lowered their rating from Outperform to Market Perform and lowered their target price from $10.00 to $4.50. Pre-market: 3.85 -0.43 (-10.15%)

Coverage Initiated

BlackRock (BLK): RBC Capital Markets initiated coverage with an Outperform rating and target price of $221.00.

ConAgra (CAG): KeyBanc Capital Markets initiated coverage with a Buy rating and target price of $30.00. Pre-market: 23.85 +0.04 (0.17%)

Coverage Reiterated/Price Target Changed 

Apple (APPL): ISI Group reiterated their Buy rating and lowered their target price from $750.00 to $710.00. Pre-market: 572.50 -28.42 (-4.73%)

Earning Reports

AFLAC (AFL): Reported EPS of $1.61 missing estimates by -$0.01.

Apple (AAPL): Reported EPS of $9.32 missing estimates by -$1.06. Pre-market: 572.50 -28.42 (-4.73%)

Compuware (CPWR): Reported EPS of $0.05 in-line with estimates.

International Game Tech (IGT): Reported EPS of $0.23 missing estimates by -$0.05.

Netflix (NFLX): Reported EPS of $0.11 beating estimates by +$0.06. Pre-market: 64.44 -15.95 (-19.85%)

Panera Bread (PNRA): Reported EPS of $1.50 beating estimates by +$0.07.

AOL (AOL): Reported EPS of $10.17 beating estimates by +$9.94.

Boeing (BA): Reported EPS of $1.27 beating estimates by +$0.16.

Bristol-Myers (BMY): Reported EPS of $0.48 in-line with estimates.

Caterpillar (CAT): Reported EPS of $2.54 beating estimates by +$0.24.

ConocoPhillips (COP): Reported EPS of $1.22 missing estimates by -$0.06.

Eli Lilly (LLY): Reported EPS of $0.83 beating estimates by +$0.07.

Ford Motor (F): Reported EPS of $0.30 beating estimates by +$0.01.

General Dynamics (GD): Reported EPS of $1.77 beating estimates by +$0.03.   

Northrop Grumman (NOC): Reported EPS of $1.88 beating estimates by +$0.27.   

      

PepsiCo (PEP): Reported EPS of $1.12 beating estimates by +$0.03.

Markets: 
Futures at 9:06: Dow +0.85%. S&P +0.66%. Nasdaq -0.15%. Crude +0.19% to $88.67. Gold +1.03% to $1592.50.

Europe: London +0.39%. Paris +0.97%. Frankfurt +0.97%. 

Asia: Japan -1.44%. Hong Kong -0.14%. China -0.49%. India -0.43%. 

MORNING COFFEE

Home Prices Increase. Home prices in the U.S. increased for the first time since 2007. The Zillow Home Value Index increased 0.2% on year to $149,300 in Q2. Phoenix Metro saw the largest increases in prices, rising +12.1% followed by Fort Myers Metro +7.9%, while Mobile Metro saw the largest decline falling -12.8%. In major metro areas Chicago Metro fell -5.8% to $158,600, Los Angeles Metro fell -2.7% to $383,200 and New York Metro declined -2.7% to $336,900. Zillow officials attributed the overall U.S. increase to increased demand due to record low interest rates. 

Upgrades
Motorola Solutions (MSI): FBR Capital raised their rating from Underperform to Market Perform and placed a target price of $49.00 on the company. Pre-market: 45.96 +0.07 (0.16%)

Goodyear Tire and Rubber (GT): Goldman Sachs raised their rating from sell to Neutral and placed a target price of $13.00 on the company. Pre-market: 10.28 +0.24 (2.39%)

Downgrades
DeVry (DV): JPMorgan Chase lowered their rating from Neutral to Underweight and lowered their target price from $35.00 to $23.00. Pre-market: 19.52 -8.04 (-29.17%)

ITT Educational (ESI): JPMorgan Chase lowered their rating from Neutral to Underweight and lowered their target price from $73.00 to $54.00. Pre-market: 53.00 -4.35 (-7.59%)

Chipotle Mexican Grill (CMG): Argus lowered their rating from Buy to Hold. Pre-market: 301.54 -4.47 (-1.46%)

Radio Shack (RSH): UBS lowered their rating from Neutral to Sell and lowered their target price from $4.40 to $3.00. Pre-market: 3.60 -0.09 (-2.44%)

Fossil (FOSL): Piper Jaffray lowered their rating from Overweight and lowered their target price from $128.00 to $76.00. Pre-market: 66.87 -1.46 (-2.14%)

Coverage Initiated
American International Group (AIG): Evercore initiated coverage with an Overweight rating. Pre-market: 30.90 +0.22 (0.72%)

Burger King Worldwide (BKW): Credit Suisse initiated coverage with a Neutral rating and target price of $16.00.

AOL (AOL): Goldman Sachs initiated coverage with a Neutral rating and target price of $33.00. Pre-market: 27.61 +0.04 (0.16%)

Earning Reports
Texas Instruments (TXN): Reported EPS of $0.44 beating estimates by +$0.04. Pre-market: 26.45 -0.37 (-1.38%)

VMware (VMW): Reported EPS of $0.68 beating estimates by +$0.01. Pre-market: 86.22 -3.01 (-3.37%)

Altria (MO): Reported EPS of $0.59 beating estimates by +$0.02. Pre-market: 35.77 +0.28 (0.79%)

AT&T (T): Reported EPS of $0.66 beating estimates by +$0.03. Pre-market: 35.45 +0.07 (0.20%)

Biogen Idec (BIIB): Reported EPS of $1.82 beating estimates by +$0.26. Pre-market: 142.92 +3.69 (2.65%)

DuPont (DD): Reported EPS of $1.48 beating estimates by +$0.02. Pre-market: 48.30 -0.41 (-0.84%)

Lockheed Martin (LMT): Reported EPS of $2.38 beating estimates by +$0.47. Pre-market: 87.05 +0.14 (0.16%)

Ryder Systems (R): Reported EPS of $1.00 beating estimates by +$0.06. Pre-market: 39.20 +4.54 (13.10%)

UPS (UPS): Reported EPS of $1.15 missing estimates by -$0.02. Pre-market: 75.00 -2.95 (-3.78%)

Markets: Futures at 7:20: Dow -0.05%. S&P -0.15%. Nasdaq -0.02%. Crude -0.22% to $87.95. Gold -0.20% to $1574.30.

Europe: London -0.18%. Paris -0.07%. Frankfurt -0.11%. 

Asia: Japan -0.24%. Hong Kong -0.79%. China +0.24%. India +0.24%.