Holding Above The March Lows
David Goldring

The major indices posted modest gains yesterday on encouraging economic data. The ISM index suggested that manufacturing activity expanded in June, which again is in keeping with the fact that things really are not as gloomy as the market envisions. Non residential construction was up 0.2% in May after a 1.6% jump in April. It bears repeating: the economy will show 2% or more growth for the 2Q. Higher beta stocks have been pummeled since June 5th and yet earnings estimates have not fallen, and just as we saw in March, it is the “fear” as opposed to the reality that is driving stocks lower. We are not even in a recession, and yet consumer confidence and economic perception is as poor as any time that we can recall. In previous downturns there was always a desire to see the sunnier side of things, and yet the fear is so palpable today that optimism has been replaced by unmitigated pessimism. The economy continues to grow, but does anyone care? We can endlessly repeat that earnings, ex-fi ...

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JDSU Disappoints
David Goldring

JDS Uniphase (JDSU – 14.31) announced week results, and while we maintain a long term positive outlook, we suspect the stock will fill its gap at $10.69 and spend a few weeks between the 10/12 area and that more base building will be necessary before any sustained Up turn. We would write covered calls or sell the stock, and revisit on any test of the January lows as price should be supported by $8 book value.


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Bunge Limited to Purcahse Corn Poducts for $4.4 Billion
StockPicks Editor

Bunge Limited (BG)
Although not a common household name, Bunge Limited is a large, well-established company. In fact, it is one of the country's oldest agricultural businesses, founded in 1818, which specializes in products such as fertilizer and oilseed products. The company announced today that it has agreed to buy Corn Products International, another agricultural business with 100 years of experience. Corn Products, unsurprisingly, specializes in a variety of corn products including various starches and sweeteners such as corn syrup. What will be the effect of the merger of these two companies; not just on the companies themselves, but also on consumers?

Stock Analysis
The merger seems to be a good deal for the two companies. The arrangement values ...

Still Bullish On Internap
David Goldring

Internap Network Services (INAP – 6.12); we recommended it the other day on the March 10th spike lower. This morning INAP is announcing they will restate earnings to account for $1-$2 million in sales return allowances. While this is not welcome news and it does bring a potential change of the 25% growth in guidance, it does not change the longer term picture. The growth in Content Delivery Networks or CDN’s will grow more in the next three years than the previous five. We feel confident that INAP will achieve its long term 25% growth target. The stock is trading below its $7 book value and less than 9x the ’09 estimate. The stock has already fallen from $17 in November despite posting a great quarter and affirming guidance. The CDN market is about to enter an explosive stage, and at $5 ...