Morning Coffee Pre-Market Wall Street News

Election Results Sends Stock Futures Lower. Last night President Obama won re-election and as soon as the markets realized that he was going to win, stock futures started heading lower.  With President Obama winning re-election Wall Street analysts are predicting that the fiscal cliff may not be solved by the end of the year, which could tip the U.S. into another recession or worse.  Additionally, taxes will go up on income, capital gains, interest and Medicare.  The national debt will also go up to a projected $20 trillion by 2016.  This is according to the White House’s own numbers, which includes $1 trillion of new unfunded national debt each year.

Upgrades

Fossil (FOSL): Caris raised their rating from Above Average to Buy and placed a target price of $105.00 on the company. Pre-market: 84.25 +0.01 (0.01%)

Marathon Oil (MRO): Global Hunter raised their rating from Accumulate to Buy and raised their target price from $35.00 to $40.00.

Downgrades

Humana (HUM): Goldman Sachs lowered their rating from Neutral to Sell and placed a target price of $77.00 on the company. Pre-market: 73.98 -2.18 (-2.86%)

AOL (AOL): CLSA lowered their rating from Outperform to Underperform and lowered their target price from $45.00 to $31.00. Pre-market: 43.02 -0.68 (-1.56%)

Tree House Foods (THS): Credit Suisse lowered their rating from Neutral to Underweight and lowered their target price from $55.00 to $50.00.

Express Scripts (ESRX): Goldman Sachs lowered their rating from Conviction Buy to Buy and placed a target price of $64.00 on the company. Pre-market: 54.26 -0.89 (-1.61%)

Coverage Initiated

Joy Global (JOY): Raymond James initiated coverage with an Outperform rating and target price of $77.50. Pre-market: 62.20 -1.52 (-2.39%)

Earning Reports

Agrium (AGU): Reported EPS of $1.34 missing estimates by -$0.48. Pre-market: 99.32 -7.83 (-7.31%)

Becton Dickinson (BDX): Reported EPS of $1.42 beating estimates by +$0.02. After Hours: 78.47 0.00 (0.00%)

Cognizant Tech (CTSH): Reported EPS of $0.91 beating estimates by +$0.04. Pre-market: 70.00 +2.65 (3.93%)

Kraft Foods (KRFT): Reported EPS of $0.79 beating estimates by +$0.10. Pre-market: 46.00 +1.30 (2.91%)

Macy's (M): Reported EPS of $0.36 beating estimates by +$0.07. Pre-market: 41.58 +0.20 (0.48%)

Orbitz (OWW): Reported EPS of $0.14 beating estimates by +$0.07. After Hours: 2.70 +0.10 (3.85%)

Time Warner (TWX): Reported EPS of $0.86 beating estimates by +$0.04. After Hours: 43.11 0.00 (0.00%)

WellPoint (WLP): Reported EPS of $2.09 beating estimates by +$0.25. Pre-market: 58.94 -2.26 (-3.69%)

Markets: 
Futures at 7:41: Dow -0.67%. S&P -0.65%. Nasdaq -0.70%. Crude -1.49% to $87.406. Gold +0.17% to $1718.00.

Europe: London -0.22%. Paris -0.41%. Frankfurt -0.27%. 

Asia: Japan -0.03% at 8973. Hong Kong +0.71% to 22100. China -0.01% at 2106. India +0.45% to 18902. 

Morning Coffee Pre-Market Wall Street News

Americans Head To Polls.  After months of campaigning, Americans will be heading to the polls to vote today.  Lines are expected to be long and tensions are high as Americans decide which direction America will take.  The stock market is expected to take a wait and see approach today, but certain areas of the market could rally depending upon whether President Obama or Gov. Mitt Romney wins the election. Sectors that could possibly rally if President Obama wins include healthcare services, homebuilding, and food and staples retailing. While the banks sector is expected to decline. If Mitt Romney becomes the next President sectors that are expected to rally include coal, specialty retail, managed care and telecommunications services.

Upgrades

Lam Research (LRCX): Susquehanna raised their rating from Neutral to Positive and raised their target price from $32.00 to $48.00.

Downgrades

Express Scripts (ESRX): Jefferies lowered their rating from Buy to Hold and lowered their target price from $70.00 to $56.00. Pre-market: 55.05 -7.83 (-12.45%)

Coverage Initiated

Kraft Foods Group (KRFT): Canaccord initiated coverage with a Buy rating and target price of $50.00. Pre-market: 44.95 +0.18 (0.40%)

Ross Stores (ROST): Credit Suisse initiated coverage with a Neutral rating and target price of $60.00.

TJX Cos. (TJX): Credit Suisse initiated coverage with a Neutral rating and target price of $45.00.

Stein Mart (SMRT): Credit Suisse initiated coverage with a Outperform rating and target price of $10.00.

Mondelez Intl (MDLZ): Canaccord initiated coverage with a Sell rating and target price of $24.00. Pre-market: 26.04 -0.37 (-1.40%)

Earning Reports

AOL (AOL): Reported EPS of $0.22 beating estimates by +$0.02. Pre-market: 36.90 +1.09 (3.04%)

CVS Caremark (CVS): Reported EPS of $0.85 beating estimates by +$0.01. Pre-market: 47.74 +1.11 (2.38%)

DIRECTV (DTV): Reported EPS of $0.90 missing estimates by -$0.04.

Dish Network (DISH): Reported EPS of -$0.35 missing estimates by -$0.91. Pre-market: 32.52 -2.31 (-6.63%)

Echostar Holdings (SATS): Reported EPS of $0.26 beating estimates by +$0.14.

Fossil (FOSL): Reported EPS of $1.26 beating estimates by +$0.09. Pre-market: 85.09 -9.01 (-9.57%)

International Flavors (IFF): Reported EPS of $1.08 in-line with estimates.

Marathon Oil (MRO): Reported EPS of $0.64 in-line with estimates.

Office Depot (ODP): Reported EPS of $0.06 beating estimates by +$0.05.

OfficeMax (OMX): Reported EPS of $0.27 beating estimates by +$0.02. Pre-market: 7.44 0.00 (0.00%)

Tidewater (TDW): Reported EPS of $0.83 beating estimates by +$0.11.

Markets: 
Futures at 7:12: Dow +0.28%. S&P +0.25%. Nasdaq +0.39%. Crude +0.54% to $86.15. Gold +0.56% to $1692.50.

Europe: London +0.57%. Paris +0.48%. Frankfurt +0.56%. 

Asia: Japan -0.36% to 8975. Hong Kong -0.28% to 21944. China -0.38% to 2106. India +0.29% to 18817. 

Morning Coffee Pre-Market Wall Street News

Companies Are Smarter Than Government. On the eve of the Presidential election more companies are proving that they are smarter than government. Darden Restaurants (DRI) which is the owner of Red Lobster, Olive Garden, Longhorn Steakhouse and Bahama Breeze is the latest company to announce they will limit staff hours to below 30 hours a week.  The move will allow the company to avoid having to pay for health insurance or face a penalty of at least $2,000 per worker, under Obama Care.

Upgrades

Walt Disney (DIS): Argus raised their rating from Hold to Buy and placed a target price of $60.00 on the company. Pre-market: 50.20 +0.34 (0.68%)

Qualcomm (QCOM): Nomura raised their rating from Neutral to Buy and placed a target price of $70.00 on the company. Pre-market: 59.63 +0.33 (0.56%)

Perrigo (PRGO): Barrington Research raised their rating from Market Perform to Outperform and placed a target price of $142.00 on the company. Pre-market: 114.60 -0.40 (-0.35%)

Aeropostale (ARO): FBR Capital raised their rating from Market Perform to Outperform and placed a target price of $16.00 on the company.

Flagstar Bancorp (FBC): FBR Capital raised their rating from Market Perform to Outperform and raised their target price from $10.00 to $17.00.

Target Group (TGT): JPMorgan raised their rating from Neutral to Overweight and raised their target price from $66.00 to $76.00. Pre-market: 63.59 +0.88 (1.40%)

Downgrades

E.I DuPont (DD): Piper Jaffray lowered their rating from Overweight to Neutral and lowered their target price from $53.00 to $51.00.

Coverage Initiated

UnitedHealth Group (UNH): Credit Suisse initiated coverage with an Outperform rating and target price of $63.00.

Costco (COST): BMO Capital initiated coverage with an Outperform rating and target price of $115.00. Pre-market: 96.54 +0.42 (0.44%)

Coverage Reiterated/Price Target Changed 

Clorox (CLX): Caris & Company reiterated their Average rating and raised their target price from $67.00 to $74.00.

Earning Reports

Church & Dwight (CHD): Reported EPS of $0.66 beating estimates by +$0.07.

Elizabeth Arden (RGEN): Reported EPS of $0.44 beating estimates by +$0.02.

Humana (HUM): Reported EPS of $2.62 beating estimates by +$0.57.

Sysco (SYY): Reported EPS of $0.58 beating estimates by +$0.07.

Transocean (RIG): Reported EPS of $1.37 beating estimates by +$0.61.

Tesla Motors (TSLA): Reported EPS of -$0.92 missing estimates by -$0.01. Pre-market: 30.00 +1.08 (3.74%)

Markets: 
Futures at 7:33: Dow -0.03%. S&P -0.14%. Nasdaq -0.02%. Crude +0.21% at $85.02. Gold +0.30% to $1680.40.

Europe: London -0.60%. Paris -0.93%. Frankfurt -0.56%. 

Asia: Japan -0.48% to 9007. Hong Kong -0.47% to 22006. China -0.14% to 2114. India +0.04% at 18763. 

Oct. Unemployment Rate Jumps.

The Unemployment Rate for October came in at 7.9%, higher than analysis expected and higher then when President Obama took office.  More worrisome is that the U6 Real Unemployment Rate came in at a very high 14.6%.  The U6 real rate includes people that found work, but are underemployed or had to take part time work.

Morning Coffee Pre-Market Wall Street News

Final Employment Report Before The Election Released Today. The final employment report before the election will be released this morning. Economists are estimating that nonfarm payrolls increased by 125,000 in October which is a very anemic rating at best. The number should also not bring down the unemployment rate which is expected to rise to 7.9%.

Upgrades

Watson Pharmaceuticals (WPI): Piper Jaffray raised their rating from Neutral to Overweight and raised their target price from $77.00 to $103.00. After Hours: 87.98 +0.27 (0.31%)

Big 5 Sports (BGFV): Needham raised their rating from Buy to Strong Buy and raised their target price from $13.00 to $15.00. After Hours: 9.93 +1.01 (11.32%)

Downgrades

Las Vegas Sands (LVS): Cantor Fitzgerald lowered their rating from Buy to Hold and lowered their target price from $50.00 to $46.00. Pre-market: 46.22 -0.24 (-0.52%)   

 

First Solar (FSLR): Cantor Fitzgerald lowered their rating from Buy to Hold and placed a target price of $23.00 on the company. Pre-market: 22.78 -1.97 (-7.96%)

Flour (FLR): Robert W. Baird lowered their rating from Outperform to Neutral and lowered their target price from $12.00 to $11.00. Pre-market: 54.65 -3.01 (-5.22%)

Boston Beer Co (SAM): CLSA lowered their rating from Outperform to Buy and lowered their target price from $130.00 to $120.00. After Hours: 108.10 +0.10 (0.09%)

Kaman (KAMN): Stephens lowered their rating from Overweight to Equal Weight and lowered their target price from $40.00 to $37.00.

Guess? (GES): Jefferies lowered their rating from Buy to Hold and lowered their target price from $45.00 to $25.00. Pre-market: 23.55 -2.34 (-9.04%)

Coverage Initiated

Deckers Outdoor (DECK): Jefferies initiated coverage with a Buy rating and target price of $50.00. Pre-market: 30.48 +0.74 (2.49%)

Delphi Automotive (DLPH): Deutsche Bank initiated coverage with a Buy rating and target price of $41.00.

Earning Reports

Hess (HES): Reported EPS of $1.64 beating estimates by +$0.45.

Markets: 
Futures at 6:38: Dow -0.05%. S&P +0.02%. Nasdaq +0.01%. Crude -0.82% to $86.38. Gold -0.43% to $1708.20.

Europe: London -0.08%. Paris -0.18%. Frankfurt -0.03%. 

Asia: Japan +1.17% to 9051. Hong Kong +1.33% to 22111. China +0.60% to 2117. India +1.04% to 18755. 

Morning Coffee Pre-Market Wall Street News

Pentagon To Stop Using BlackBerries Exclusively. 

The Pentagon announced that there are requesting bids for software that can manage and enforce security for Apple (APPL) and Android (GOOG) devices. The agency has for years only used BlackBerries (RIMM) and said that they would continue supporting "large numbers" of BlackBerries.   Pre-market: 7.98 +0.05 (0.69%)

Sharp Gives Warning To Apple. 

Sharp (SHCAY), which is a major supplier to Apple (AAPL), warned that there is "material doubt" about the company’s ability to survive after posting a much larger than expected FQ2 net loss of ¥249.1B ($3.11B).  The company took a special loss of ¥84.4B on restructuring costs and wrote down deferred tax assets by ¥61B. The company also gave FY guidance of a net loss of ¥450B.

Upgrades

Cirrus Logic (CRUS): Needham raised their rating from Buy to Strong Buy and raised their target price from $53.00 to $57.00. Pre-market: 41.97 +1.19 (2.92%)

Total SA ADS (TOT): Societe Generale raised their rating from Hold to Buy.

Downgrades

Netflix (NFLX): Oppenheimer lowered their rating from Outperform to Perform. Pre-market: 77.25 -1.99 (-2.51%)

PriceSmart (PSMT): The Benchmark Company lowered their rating from Buy to Hold.

Zumiez (ZUMZ): DA DAvidson lowered their rating from Buy to Neutral and lowered their target price from $36.00 to $25.00. Pre-market: 21.43 -3.89 (-15.36%)

Western Union (WU): First Analysis lowered their rating from Overweight to Equal Weight. Pre-market: 12.88 +0.15 (1.19%)

Johnson Controls (JCI): Needham lowered their rating from Buy to Hold.

Earning Reports

Cirrus Logic (CRUS): Reported EPS of $0.79 beating estimates by +$0.08. Pre-market: 41.97 +1.19 (2.92%)

Visa (V): Reported EPS of $1.54 beating estimates by +$0.04. Pre-market: 141.21 +2.45 (1.77%)

Automatic Data Processing (ADP): Reported EPS of $0.62 in-line with estimates.

CIGNA (CI): Reported EPS of $1.71 beating estimates by +$0.35. After Hours: 50.53 -0.47 (-0.92%)

Delphi Automotive (DLPH): Reported EPS of $0.84 beating estimates by +$0.13.

Exxon Mobil (XOM): Reported EPS of $2.09 beating estimates by +$0.16. Pre-market: 90.70 -0.47 (-0.52%)

Invesco (IVZ): Reported EPS of $0.42 missing estimates by -$0.02.

L-3 Comms (LLL): Reported EPS of $1.87 beating estimates by +$0.01.

Pfizer (PFE): Reported EPS of $0.53 beating estimates by +$0.01. Pre-market: 24.51 -0.36 (-1.45%)

Teva Pharma (TEVA): Reported EPS of $1.28 beating estimates by +$0.03. Pre-market: 40.75 +0.33 (0.82%)

Watson Pharm (WPI): Reported EPS of $1.30 in-line with estimates. After Hours: 85.67 -0.28 (-0.33%)

Xylem (XYL): Reported EPS of $0.44 beating estimates by +$0.01.

Markets: 
Futures at 8:00: Dow -0.02%. S&P +0.02%. Nasdaq +0.21%. Crude +0.21% to $86.4. Gold +0.37% to $1725.50.

Europe: London +0.67%. Paris +0.70%. Frankfurt +0.71%. 

Asia: Japan +0.21% to 8947. Hong Kong +0.83% to 21822. China +1.72% to 2104. India +0.30% to 18562.