Morning Coffee Pre-Market Wall Street News

UPS and the University of Virginia Blame Obamacare for Cuts. Both UPS (UPS) and the University of Virginia announced they would end offering medical benefits to family members of employees, blaming Obamacares increased cost as the direct cause. UPS in an announcement said it will cut healthcare benefits for around 15,000 working spouses of employees starting in 2014. The company said that it expects coast to the company due to Obamacare to increase +11.25%. In a memo the company also said that it expects that 35% of companies will also drop coverage of employee spouses.  The University of Virginia announced that they also will be dropping coverage of employee spouses due to direct cost increases due to Obamacare. The University said that it expects to pay $7.3 million more in 2014 due to Obamacare. Additionally, Xerox (XRX) is having employees pay $1,000 if they wish to keep their spouse on their current company medical plan, otherwise the company will be dropping them.

Upgrades:

Microsoft (MSFT): Nomura raised their rating from Neutral to Buy and placed a target price of $38.00 on the company. Pre-market: 32.12 +0.51 (1.61%)

Precision Castparts (PCP): Wells Fargo raised their rating from Market Perform to Outperform and raised their target range from $228.00-$234.00 to $240.00-$248.00.

Downgrades:

Abercrombie & Fitch (ANF): Janney Capital lowered their rating from Buy to Neutral. Pre-market: 37.74 -9.06 (-19.36%)

Target Corp (TGT): ISI Group lowered their rating from Strong Buy to Buy and placed a target price of $70.00 on the company. Pre-market: 65.25 -0.25 (-0.38%)

Target Corp (TGT): William Blair lowered their rating from Market Perform to Undrperform. Pre-market: 65.25 -0.25 (-0.38%)

Coverage Initiated:

Tesla Motors (TSLA): Stifel initiated coverage with a Hold rating. Pre-market: 149.12 +1.26 (0.85%)

Zynga (ZNGA): The Benchmark Co initiated coverage with a Hold rating and a target price of $2.98. Pre-market: 2.77 +0.02 (0.73%)

Earning Reports:

Abercrombie & Fitch (ANF): Reported EPS of $0.16 missing estimates by -$0.12. Pre-market: 37.74 -9.06 (-19.36%)

Children’s Place (PLCE): Reported EPS of -$0.42 beating estimates by +$0.11. Pre-market: 55.87 +4.47 (8.70%)

Dollar Tree (DLTR): Reported EPS of $0.56 missing estimates by -$0.01. Pre-market: 51.45 -0.39 (-0.75%)

Gamestop (GME): Reported EPS of $0.09 beating estimates by +$0.06. Pre-market: 52.40 +4.78 (10.04%)

Hewlett-Packard (HPQ): Reported EPS of $0.86 in-line with estimates. Pre-market: 23.49 -1.89 (-7.45%)

Hormel Foods (HRL): Reported EPS of $0.42 missing estimates by -$0.03. Pre-market: 41.60 -0.51 (-1.21%)

Patterson Companies (PDCO): Reported EPS of $0.46 missing estimates by -$0.03.

Sears Holdings (SHLD): Reported EPS of -$1.46 missing estimates by -$0.34. Pre-market: 40.13 -3.14 (-7.26%)

Markets: 
Futures at 8:09: Dow +0.24%. S&P +0.32%. Nasdaq +0.47%. Crude +0.22% to $104.07. Gold +0.07% to $1371.00. U.S. 10 Year -1/32 2.902%.

Europe: London +0.87%. Paris +0.96%. Frankfurt +1.08%. 

Asia: Japan -0.44% to 13365. Hong Kong +0.36% to 21895. China -0.28% to 2067. India +2.27% to 18313. 

Morning Coffee Pre-Market Wall Street News

U.S. Stock Futures Lower Before Fed Announcement. U.S. stock futures are lower as Wall Street waits for the Fed to announce the results of the latest FOMC meeting. Economists are not expecting the Fed to raise interest rates, but Wall Street traders will be looking closely at the language contained in the announcement for signs that the Fed could end their stimulus program earlier than expected. This morning the U.S. 10 Year yield is higher at 2.827%.

Upgrades:

Garmin Ltd. (GRMN): Goldman Sachs raised their rating from Sell to Neutral and placed a target price of $39.00 on the company.

Herbalife (HLF): Argus raised their rating from Hold to Buy and placed a target price of $80.00 on the company. Pre-market: 66.00 +1.28 (1.98%)

NASDAQ OMX Group (NDAQ): Raymond James raised their rating from Outperform to Strong Buy and raised their target price from $36.00 to $38.00.

Royal Caribbean Cruises (RCL): Morgan Stanley raised their rating from Equal Weight to Overweight and raised their target price from $37.00 to $49.00. Pre-market: 38.38 +0.33 (0.87%)

Downgrades:

Agrium (AGU): HSBC lowered their rating from Overweight to Neutral.

Chesapeake Energy (CHK): Susquehanna lowered their rating from Positive to Neutral. Pre-market: 24.95 -0.31 (-1.23%)

Mosaic (MOS): HSBC lowered their rating from Neutral to Underweight. Pre-market: 41.46 -0.52 (-1.24%)

Potash Corp. of Saskatchewan (POT): HSBC lowered their rating from Overweight to Underweight. Pre-market: 29.60 -0.40 (-1.33%)

Tupperware Brands (TUP): BMO Capital lowered their rating from Outperform to Market Perform and placed a target price of $91.00 on the company.

Coverage Initiated:

Navistar Intl (NAV): Susquehanna initiated coverage with a Neutral rating and target price of $31.00.

PACCAR Inc (PCAR): Susquehanna initiated coverage with a Neutral rating and target price of $56.00.

SodaStream Intl (SODA): Longbow initiated coverage with a Buy rating and target price of $79.00. Pre-market: 65.00 +1.04 (1.63%)

Earning Reports:

American Eagle (AEO): Reported EPS of $0.09 missing estimates by -$0.01.

Barnes & Noble (BKS): Reported EPS of -$0.86 missing estimates by -$0.07. Pre-market: 14.65 +0.04 (0.27%)

Best Buy (BBY): Reported EPS of $0.32 beating estimates by +$0.21. Pre-market: 34.54 -0.26 (-0.75%)

Dick's Sporting Goods (DKS): Reported EPS of $0.71 missing estimates by -$0.03.

Home Depot (HD): Reported EPS of $1.24 beating estimates by +$0.03. Pre-market: 74.60 +0.31 (0.42%)

JC Penney (JCP): Reported EPS of $1.17 missing estimates by -$0.03.

J.M. Smucker (SJM): Reported EPS of $1.20 beating estimates by +$0.04.

Lowe’s (LOW): Reported EPS of $0.88 beating estimates by +$0.09.

Medtronic (MDT): Reported EPS of $0.88 in-line with estimates.

PetSmart (PETM): Reported EPS of $0.89 beating estimates by +$0.03.

Staples (SPLS): Reported EPS of $0.16 missing estimates by -$0.02.

Target (TGT): Reported EPS of $0.95 in-line with estimates.

TJX (TJX): Reported EPS of $0.66 beating estimates by +$0.03.

Toll Brothers (TOLL): Reported EPS of $0.26 beating estimates by +$0.01.

Trina Solar (TSL): Reported EPS of -$0.47 beating estimates by +$0.11.

Markets: 
Futures at 7:47: Dow -0.17%. S&P -0.18%. Nasdaq -0.19%. Crude -0.55% to $104.53. Gold -0.48% to $1366.10. U.S. 10 Year -3/32 2.827%.

Europe: London -0.50%. Paris 0.00%. Frankfurt -0.13%. 

Asia: Japan +0.21% to 13424. Hong Kong -0.69% to 21818. China +0.02% at 2073. India -1.86% to 17906. 

Morning Coffee Pre-Market Wall Street News

Bonds Continue to See Massive Outflows. According to a report from TrimTabs outflows from U.S. bond mutual funds and ETFs have risen to $19.7B so far in August. So far this month’s number is the fourth-highest outflow on record and up from $14.8B in July. Since the beginning of June, $103.5B or 2.7% of the total assets invested in bond funds have left the asset class. The mass exodus can be directly tired to fears of the Fed ending its stimulus program which has sent yields higher. This morning the U.S. 10 Year stands at 2.843% its highest yield in over two years. U.S. 10 Year -4/32 2.843%

Upgrades:

American Midstream Partners (AMID): Wells Fargo raised their rating from Market Perform to Outperform and raised their target range from $19.00-$21.00 to $23.00-$25.00.

Dollar General (DG): JPMorgan raised their rating from Neutral to Overweight and raised their target price from $51.00 to $64.00.

Intel (INTC): Piper Jaffray raised their rating from Underweight to Neutral and raised their target price from $20.00 to $22.00. Pre-market: 22.03 +0.11 (0.52%)

Kaiser Aluminum (KALU): Sterne Agee raised their rating from Neutral to Buy.

Orbital Sciences (ORB): ReserchTeam raised their rating from Reduce to Hold.

Public Storage (PSA): RBC Capital raised their rating from Underperform to Sector Perform and raised their target price from $158.00 to $160.00.

Pulte Group (PHM): Wells Fargo raised their rating from Market Perform to Outperform and raised their target range from $15.50-$16.50 to $19.00-$20.00. Pre-market: 16.49 +0.21 (1.29%)

Ross Stores (ROST): Morgan Stanley raised their rating from Equal Weight to Overweight and placed a target price of $77.00 on the company. Pre-market: 66.00 +1.24 (1.91%)

Downgrades:

Abbott (ABT): ResearchTeam lowered their rating from Hold to Reduce.

Foot Locker (FL): ResearchTeam lowered their rating from Hold to Reduce.

TRW Automotive (TRW): ResearchTeam lowered their rating from Accumulate to Hold.

Union Pacific (UNP): ResearchTeam lowered their rating from Hold to Reduce.

Coverage Initiated:

Lumber Liquidators (LL): Jefferies initiated coverage with a Buy rating and target price of $115.00.

Earning Reports:

Saks (SKS): Reported EPS of -0.10 missing estimates by -$0.02. Pre-market: 16.00 -0.02 (-0.12%)

Markets:

Futures at 7:28: Dow -0.03%. S&P -0.08%. Nasdaq +0.04%. Crude -0.10% to $107.06. Gold +0.08% to $1372.20. U.S. 10 Year -4/32 2.843%

Europe: London -0.45%. Paris -0.87%. Frankfurt -0.30%. 

Asia: Japan +0.79% to 13758. Hong Kong -0.24% to 22464. China +0.83% to 2086. India -1.56% to 18266. 

Morning Coffee Pre-Market Wall Street News

U.S. Housing Numbers Miss Estimates. The Commerce Department reported that July’s housing starts rose 5.9% to a seasonally adjusted annual rate of 896,000 units. Wall Street Economists had estimated that housing starts would come in at 900,000 units. June's numbers were revised upward to 846,000-units from the previously reported. Permits to build new homes increased 2.7% in July to a 943,000-unit pace also missing estimates. Economists had expected permits to rise to 945,000. Wall Street analysts are pointing to higher interest rates as the cause of the misses.

Upgrades:

Applied Materials (AMAT): DA Davidson raised their rating from Neutral to Buy and raised their target price from $15.00 to $18.00.

JetBlue Airlines (JBLU): Raymond James raised their rating from Underperform to Market Perform.

Pandora Media (P): Goldman Sachs raised their rating from Neutral to Buy and placed a target price of $27.00 on the company.

Wal-Mart (WMT): S&P raised their rating from 3 Stars to 4 Stars.

Downgrades:

Alcoa (AA): Bank of America Merrill Lynch lowered their rating from Neutral to Underperform and placed a target price of $8.00 on the company.

Colgate-Palmolive (CL): Argus lowered their rating from Buy to Hold.

General Mills (GIS): Jefferies lowered their rating from Hold to Underperform and lowered their target price from $45.00 to $44.00.

Noble Energy (NE): ISI Group lowered their rating from Strong Buy to Buy and placed a target price of $67.00 on the company.

Nordstrom (JWN): Sterne Agee lowered their rating from Buy to Neutral and placed a target price of $62.00 on the company.

Transocean (RIG): Johnson Rice lowered their rating from Overweight to Underweight.

Coverage Initiated:

Xcel Energy (XEL): UBS initiated coverage with a Neutral rating and target price of $30.00.

Earning Reports:

Applied Materials (AMAT): Reported EPS of $0.18 missing estimates by -$0.01.

Dell (DELL): Reported EPS of $0.25 beating estimates by +$0.01.

Nordstrom (JWN): Reported EPS of $0.93 beating estimates by +$0.05.

Markets: 
Futures at 9:01: Dow 0.00%. S&P +0.10%. Nasdaq +0.27%. Crude +0.08% to $107.44. Gold +0.34% at $1365.40. U.S. 10 Year -1/32 2.778%

Europe: London 0.00%. Paris +0.06%. Frankfurt -0.36%. 

Asia: Japan -0.75% to 13650. Hong Kong -0.10% to 22518. China -0.65% to 2068. India -3.97% to 18618. 

Morning Coffee Pre-Market Wall Street News

Cisco Shares Get Hit. 

Shares of tech giant Cisco System (CSCO) are getting hit hard in the pre-market after the company provided FQ1 guidance that disappointed Wall Street analysts.  The company also said it was cutting 4,000 jobs to cope with a "challenging" global environment. Cisco expects FQ1 revenue growth of 3-5% and EPS of $0.50-0.51 vs consensus of 4.9% and $0.51 respectively. The company did report FQ4 earnings $0.52 and sales increasing +6% to $12.42B beating Wall Street estimates. Profits at the company increased to $2.27B from $1.92B last year. Pre-market: 24.40 -1.98 (-7.50%)

Upgrades:

Baker Hughes (BHI): RBC Capital raised their rating from Sector Perform to Outperform and raised their target price from $56.00 to $58.00.

Cisco (CSCO): ISI Group raised their rating from Cautious to Neutral. Pre-market: 24.40 -1.98 (-7.50%)

 ITC Holdings (ITC): ISI Group raised their rating from Neutral to Buy and placed a target price of $100.00 on the company.

National Oilwell (NOV): RBC Capital raised their rating from Sector Perform to Outperform and raised their target price from $78.00 to $86.00. Pre-market: 73.00 -0.40 (-0.54%)

Downgrades:

Deere & Co (DE): Argus lowered their rating from Buy to Hold. Pre-market: 81.37 -0.97 (-1.18%)

Intel (INTC): RW Baird lowered their rating from Outperform to Neutral and lowered their target price from $26.00 to $23.00. Pre-market: 22.28 -0.29 (-1.28%)

Micron Tech (MU): RW Baird lowered their rating from Outperform to Neutral and maintained the target price of $17.00. Pre-market: 14.46 -0.36 (-2.43%)

Smith & Wesson (SWHC): KeyBanc lowered their rating from Hold to Underweight and placed a target price of $10.00 on the company.

Coverage Initiated:

Agilent (A): Janney Capital initiated coverage with a Neutral rating and target price of $50.00. Pre-market: 48.10 +1.59 (3.42%)

Danaher Corp (DHR): Janney Capital initiated coverage with a Buy rating and target price of $83.00. Pre-market: 66.30 -0.37 (-0.55%)

NutriSystem (NTRI): Imperial Capital initiated coverage with an In-Line rating and target price of $14.00.

Pall Corp (PLL): Janney Capital initiated coverage with a Neutral rating and target price of $79.00.

Thermo Fisher (TMO): Janney Capital initiated coverage with a Buy rating and target price of $113.00.

Waters Corp (WAT): Janney Capital initiated coverage with a Neutral rating and target price of $118.00.

Earning Reports:

Agilent (A): Reported EPS of $0.68 beating estimates by +$0.06. Pre-market: 48.10 +1.59 (3.42%)

Briggs & Stratton (BGG): Reported EPS of $0.22 beating estimates by +$0.03. Pre-market: 20.51 +0.41 (2.04%)

Cisco Systems (CSCO): Reported EPS of $0.52 beating estimates by +$0.01. Pre-market: 24.40 -1.98 (-7.50%)

Estee Lauder (EL): Reported EPS of $0.24 beating estimates by +$0.03. Pre-market: 67.00 +1.87 (2.87%)

G&K (GK): Reported EPS of $0.66 beating estimates by +$0.01.

Kolh’s (KSS): Reported EPS of $1.04 in-line with estimates. Pre-market: 51.85 +1.01 (1.99%)

Wal-Mart (WMT): Reported EPS of $1.25 in-line with estimates. Pre-market: 74.55 -1.85 (-2.42%)

Markets: 
Futures at 6:20: Dow -0.31%. S&P -0.56%. Nasdaq -0.70%. Crude +0.38% to $107.26. Gold +0.10% to $1334.90. U.S. 10 Year -20/32 2.794%

Europe: London -1.33%. Paris -0.61%. Frankfurt -0.77%. 

Asia: Japan -2.12% to 13753. Hong Kong -0.01% at 22539. China -0.87% to 2082. India closed.