The Market Remains in Full Bull Mode (DELL, PFCB, ANF, FDO, ELOS, CAGC)
Stocks shrugged off inflation data and some geopolitical tension as Iran sailed two warships through the Suez Canal on the way to ally Syria and past rival Israel (they were the first Iranian warships to pass through the Suez canal since 1979.) Right now, the market remains in full bull mode, and by and large any negative data or happenings are largely being ignored.
The Cosmetic Laser Stocks Index was the top performing tickerspy Index on the day, led by Syneron Medical (ELOS) with a 21% gain. The Chinese Agriculture Stocks Index was the day’s worst performing tickerspy Index, with China Agritech (CAGC) down -19%.
Stocks rose on the day, led by a 21-point, or 0.8%, gain in the Nasdaq to 2,826. The Dow rose 62 points to 12,288, while the S&P advanced 8 points to 1,336. Oil increased by 67 cents to $84.99 a barrel, while gold edge up $1.00 to $1,375.10 an ounce.
In economic news, the Bureau of Labor Statistics said its Producer Price Index (PPI) rose 0.8% in January and was revised up to an increase of 0.9% in December from a previous estimate of 0.7%. Excluding volatile food and energy costs, the core PPI jumped 0.5%, well above the 0.2% increase economists were forecasting. The January core PPI increase was the largest in two years. Elsewhere, January housing starts rose 14.6% to a seasonally-adjusted 596,000 from 520,000 in December. The December number was revised lower from a prior reading of 529,000. The consensus estimate called for 540,000 new housing starts in January.
In earnings news, shares of Dell (DELL) surged 11.9% after the computer maker said its fourth-quarter profit more than doubled to $927 million, or 48 cents per share, from $334 million, or 17 cents per share, a year earlier. Revenue climbed 5% to $15.69 billion. Excluding one-time items, Dell said it earned 53 cents a share. Analysts were expecting a profit of 36 cents a share on sales of $15.75 billion. Looking forward, Texas-based Dell is forecasting revenue growth of 5%-9% to between $64.6-$67.0 billion. Analysts were expecting revenue of $64.2 billion. Nearly 40 pros held Dell in their portfolios at the end of the third quarter, and almost 860 tickerspy members own the stock in their portfolios.
P.F. Chang’s China Bistro (PFCB) shares rose 1.8% after the company said its fourth-quarter earnings rose 22% to $14.68 million, or 64 cents per share, from $12 million, or 53 cents per share, a year earlier. Analysts were expecting a profit of 57 cents a share. Revenue slumped 5% to $311.2 million. P.F. Chang’s said it expects full-year earnings of $2.15-$2.20 a share. Analysts were expecting $2.19 a share.
Shares of apparel retailer Abercrombie & Fitch (ANF) jumped 7.6% after the company said its fiscal fourth-quarter profit soared to $92.6 million, or $1.03 per share, from $47.5 million, or 53 cents per share, a year earlier as revenue jumped 23% to $1.15 billion, which was in line with analysts’ estimates. Excluding one-time items, the company earned $1.38 a share, topping the $1.31 consensus estimate. Revenue at stores open at least a year increased 13%.
Family Dollar Stores (FDO) shares climbed 21.1% after the company received a takeover offer worth as much as $7.6 billion from Nelson Peltz’s Trian Fund Management. The offer values Family dollar at between $55-$60 a share, or as much as 36% above where the shares closed on Tuesday. There is speculation that private equity firms may also jump in to bid for Family Dollar and that Trian may have difficulty financing the deal, Bloomberg News reported citing an industry analyst and a hedge fund manager. Fifteen pros held Family Dollar in their portfolios at the end of the third quarter, and almost 230 tickerspy members own the stock in their portfolios.
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