BloggingStocks

Early analyst calls (CC) (HOV) (YHOO)

Douglas McIntyre — 2008-06-24T07:20:00+00:00

Filed under: Before the bell, Analyst upgrades and downgrades, Yahoo! (YHOO), Circuit City Stores (CC), Potash Corp. of Saskatchewan (POT)

Lehman Brothers reiterated its "underweight" rating on Circuit City (NYSE:CC) ahead of the company's annual meeting, according to the AP.

Credit Suisse started Hovnanian (NYSE:HOV) and Meritage Homes (NYSE:MTH) as "underperform," according to Briefing.com.

Thomas Weisel downgraded Yahoo! (NASDAQ:YHOO) to "underweight" from "market weight," according to Briefing.com. The news service also reports that UBS upped its price target on Potash (NYSE:POT) from $250 to $285.

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Some agricultural stocks to consider from BusinessWeek

Eliza Popescu — 2008-06-20T15:17:00+00:00

Filed under: Forecasts, Consumer experience, Competitive strategy, Archer-Daniels-Midland (ADM), Economic data, Deere and Co (DE), Commodities, Agriculture, Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT)

When natural disasters happen, there are always some companies that can turn the circumstances in their favor. Recent downpours in the Midwest provided such an opportunity as they came not only with high damages for people in the area, but also with floods for crop production, causing even higher agricultural commodity prices. The rise in corn and soybeans prices could easily lead to an increased demand for seeds, agricultural equipment, and fertilizers. BusinessWeek suggests some big names to invest in that could offer us the advantages we are looking for.

One such company is Archer Daniels Midland (NYSE: ADM), which could also benefit from higher ethanol prices, after purchasing seven businesses in 2007. Bunge Limited (NYSE: BG) is also amid possible winners, having forecast better-than-expected fertilizer earnings. Shell eggs producer Cal-Maine Foods (NASDAQ: CALM) is also on the selected list; the company saw its shares climb 15% year to date, and has just revealed a new dividend payout policy.

Another important name is Mosaic Co. (NYSE: MOS), whose stock prices have surged 70% so far this year. BusinessWeek cites Mosaic as being able to benefit from higher prices for fertilizer and potash. Following the same logic, the article points out potash provider Potash Corp. of Saskatchewan (NYSE: POT) and fertilizer distributor CF Industries Holdings (NYSE: CF), which should be able to take advantage of the weak dollar and higher sales prices.

Another stock to consider is Monsanto (NYSE: MON), which should benefit from higher planted corn acreage and strong seed prices. At the same time, farm-equipment makers such as John Deere (NYSE: DE) are expected to see an increase demand for their products as farmers will need more and more tractors to boost their activity.

However, those are only a few big names that BusinessWeek recommends to us. To get a clearer and more comprehensive image of these potential companies and their chances, just take a look at the BusinessWeek slide show.

Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.

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Favorite farm stocks, millions more could get rebate check & downtowns in danger - Today in Money 6/20

Allan Halprin — 2008-06-20T08:43:00+00:00

Filed under: Yahoo! (YHOO), Starbucks (SBUX), General Motors (GM), Money and Finance Today, Archer-Daniels-Midland (ADM), Contl Airlines'B' (CAL), UAL Corp (UAUA), Deere and Co (DE), Potash Corp. of Saskatchewan (POT), MBIA Inc (MBI)

In the News

· Continental, United Airlines Align to Lower Costs

· Moody's Cuts Bond Insurers MBIA, Ambac Ratings

· General Motors Stops Major Overhaul of Pickups, SUVs

· Yahoo's Turmoil Spreads as Top Executives Flee

· Yahoo Planning to Reorganize

· Starbucks Bringing Back Bolder Coffee

· Winnebago Sales Plunge

· Girlfriend of Missing Hedge Fund Swindler Arrested

· Some Gas Stations Declining Credit Cards

· Sorry, Charlie: Del Monte May Sell StarKist

Farm Stocks: Pick of the Crop
Millions of acres of farmland may be under water, but some agricultural outfits stand to benefit as higher prices lead to demand for seeds, equipment, and fertilizer. They include Archer Daniels Midland, Mosiac, Potash Corp., Agriam, Monsanto and John Deere.
Ag Stocks: Farm Favorites

Millions More Could Get a Rebate If They File a Return
Even as the IRS has sent out nearly 77 million tax rebates, more than 5 million retirees and disabled veterans who may qualify for a rebate haven't received one because they haven't filed a tax return.
Millions more could get a rebate if they file a return - USATODAY.com

Downtowns in Danger of Going Downhill, Again
In recent years many once moribund downtowns received funding to begin impressive comebacks as both residential and commercial centers. But as the economy stumbles and the money dries up, many projects are stalling. Will these downtowns be able to survive the downturn? From L.A. to Richmond and Atlanta to Seattle see which project are in danger in 13 cities.
Are Downtowns in Danger of Going Downhill Again?
In Pictures: Downtowns in Downturn

Credit Scores: Now Lifestyle Matters Too
Lenders may be monitoring your bar tab or marriage counseling bill - which could be costly for consumers.
Are Creditors Eyeing Your Purchases? - BusinessWeek

To Save Money at Gas Pump, Pay Cash
Filling stations are slapping a 6¢-a-gallon premium on credit-card customers, to help offset the hefty fees such purchases involve.
To Save Money at the Gas Pump, Pay Cash

6 Destinations to See Before It's Too Late
Global warming is expected to ruin some of the world's most beautiful tourist spots. They include Glacier National Park, Montana, The Maldives, Mount Kilimanjaro, Mauritius, Lake Mead in Neveda and Churchill, Manitoba.
6 Vacation Spots Threatened by Global Warming -SmartMoney.com

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Agrium (AGU): Shares define bullish 'flag'

Larry Schutts — 2008-06-16T10:57:00+00:00

Filed under: Analyst upgrades and downgrades, Good news, Technical Analysis, Stocks to Buy, Potash Corp. of Saskatchewan (POT)

Agrium (NYSE: AGU) is a leading producer and marketer of agricultural nutrients, in North and South America. The firm's plants can produce more than eight million tons of fertilizers per year. These are sold to wholesale distributors and through more than four hundred company retail outlets. Agrium also participates in a joint venture with Repsol YPF (NYSE: REP), operating Argentina's largest nitrogen plant. Potash Corporation of Saskatchewan (NYSE: POT) is a major competitor.

The company pleased investors last week, when it raised its Q2 EPS guidance from $1.92-$2.22 to $2.80-$3.00. The Street had been expecting $2.50. Management attributed the positive outlook to strong global crop prices and the resulting solid performances by both its retail and wholesale operations. BMO Capital Markets subsequently reiterated its "outperform" rating on the shares and boosted its price target to $125.

The stock popped on the news and has since been defining a bullish "flag" consolidation pattern. Prices frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Altogether, brokers recommend the issue with three "strong buys", six "buys" and two "holds". Analysts see a 20% growth rate, through the next year. The AGU Sales Growth rate (34.84%), EPS Growth rate (846.15%), Operating Margin (17.15%), Return on Assets (12.63%), Return on Investment (18.28%) and Return on Equity (28.53%) compare favorably with industry, sector and S&P 500 averages. Institutional investors hold about 72% of the outstanding shares. Over the past 52 weeks, the stock has traded between $34.62 and $103.67. A stop-loss of $90.00 looks good here. Note that the firm is expected to present Q2 results in early August.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in any of the stocks mentioned above.

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Cramer on BloggingStocks: An awful moment might offer some buys

Jim Cramer — 2008-06-12T09:33:00+00:00

Filed under: Deals, Market matters, Anheuser-Busch Cos (BUD), Federal Natl Mtge (FNM), Countrywide Financial (CFC), Amer Intl Group (AIG), Washington Mutual (WM), Lehman Br Holdings (LEH), Stocks to Buy, Stocks to Sell, Cramer on BloggingStocks, Potash Corp. of Saskatchewan (POT)

TheStreet.com's Jim Cramer says the market's a mess, but the S&P oscillator and buyout offers could give an opportunity for trades.

Here we are again. Another unfathomable moment to buy stocks.

You have the financials just falling apart at the seams.

Oil and the grains are out of control.

The Fed chairman and the Treasury secretary have declared the worst is over even as we await the demise of a half-dozen banks, and we question the solvency of Fannie Mae (NYSE: FNM) (Cramer's Take) and Freddie Mac (NYSE: FRE) (Cramer's Take). The only stocks working are Mosaic (NYSE: MOS) (Cramer's Take), Agrium (NYSE: AGU) (Cramer's Take), Potash (NYSE: POT) (Cramer's Take) and a handful of natural gas companies.

It's crazy out there.

And yet my best indicator, the Standard & Poor's oscillator, which you can order from their Web site, is saying you cannot be short here and should be doing some buying. The oscillator, when it has been at minus 5, has called a bottom almost every time in the last decade, plus or minus a day or two, and a percent or even two, and I have long since learned not to see through it.

Look, let's be honest. It is almost impossible to be bullish here. There's nothing good happening at all. But I can make a valuation case for much of this market because of that. Of course, it is anecdotal, but consider today's news story about Anheuser-Busch (NYSE: BUD) (Cramer's Take). Sure, the $46.4 billion bid is a 35% premium to the 30-day average, as the Journal points out, but InBev is buying this worldwide company for a song relative to five years ago because of the weak dollar.

There are so many BUDs out there that you have to ask whether we couldn't see more of them. We have had a couple. I expected a torrent and I haven't gotten it. But the point is larger: stocks are cheap, and in euro or yen or zloty or whatever terms, they are dirt-cheap.

No, I am not foolish enough to "like" this market. I am saying I respect my oversold indicators. And I am going to put my spare cash that I have in Action Alerts PLUS -- and I have been raising cash -- to work today and tomorrow because of that oscillator.

Random musings: Obama adviser story says it all about both FNM and Countrywide (NYSE: CFC) (Cramer's Take), two total ne'er-do-wells. ... If Lehman (NYSE: LEH) (Cramer's Take) catches a bid today, the market will rock. That's become the key stock. ... Washington Mutual (NYSE: WM) (Cramer's Take) and AIG (NYSE: AIG) (Cramer's Take) boards will be sued, I predict, if they keep these menaces at the helm. ... The CSX (NYSE: CSX) (Cramer's Take) ruling bugs me. If they violated the law, why not just stop them? But Judge Kaplan's real smart, so he must know what he is doing.

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RELATED LINKS:
Anheuser-Busch Shares Frothy on Bid News
How Oil and Water Futures Affect Ag Stocks
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Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer had no positions in the stocks mentioned.

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Serious Money: What's up today? Food & drillers!

Sheldon Liber — 2008-06-11T13:45:00+00:00

Filed under: Major movement, International markets, Rants and raves, Anadarko Petroleum (APC), Oil, Agriculture, Stocks to Buy, Best Stocks for 2008, Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT), Loews Corporation (LTR), Precision Drilling TR (PDS)

The stock market is in turmoil today and the reasons can be found elsewhere (including in some peoples' imaginations). But if you are a bottom line investor, then here is where you should be looking. Food and energy exploration are the places to be.

Things can change rapidly, but as of right now food related stocks like Bunge Ltd. (NYSE: BG), the largest company involved with soy based products, and Potash Corp. of Saskatchewan (NYSE: POT), the largest fertilizer company, are up.

In the exploration sector, Anadarko Petroleum (NYSE: APC), the oil, gas and exploration company, Loews Corporation (NYSE: LTR), which is the majority shareholder in Diamond Offshore Drilling and is separating from its tobacco interests, and Precision Drilling TR (NYSE: PDS), the Canadian contract driller that is expanding into the lower 48 states, are all up.

All five stocks have out performed the market this year and that trend does not seem to be in jeopardy yet.

I will update this post with final results after the market close to see how the story ends.

UPDATE: four of the five closed in positive territory when all the major indices were in the red.

APC finished down to $77.69, -0.54 (-0.69%)
BG finished up to $122.40, +0.47 (+0.39%)
LTR finished up to $48.95, +0.45 (+0.93%)
PDS finished up to $26.95, +0.49 (+1.85%)
POT finished up to $223.10 +2.54 (+1.15%)

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares of APC and PDS.

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CF Industries (CF) boosted by rising agricultural futures

Brent Archer — 2008-06-09T14:41:00+00:00

Filed under: Major movement, Analyst reports, Good news, Industry, Options, Technical Analysis, Commodities, Potash Corp. of Saskatchewan (POT)

CF Industries (NYSE: CF) shares are trading higher today as bio-fuel related agricultural futures, including corn and soybeans are soaring, which is pushing the fertilizer stocks higher. An analyst at Goldman Sachs also raised his price target on competitor Potash Corp. of Saskatchewan (NYSE: POT). If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on CF.

After hitting a one-year low of $44.16 in August, the stock hit a one-year high of $159.00 in April. CF opened this morning at $149.99. So far today the stock has hit a low of $149.99 and a high of $154.52. As of 12:45, CF is trading at $154.37, up $7.70 (5.3%). The chart for CF looks bullish and deteriorating slightly, while S&P gives the stock a neutral 3 Stars (out of 5) Hold rating.

For a bullish hedged play on this stock, I would consider a July bull-put credit spread below the $115 range. A bull-put credit spread is an options position that combines the purchase and sale of put options to hedge risk in case the stock doesn't do what you think but still leverage nice returns. This particular trade will make a 5.3% return in just six weeks as long as CF is above $115 at July expiration. CF would have to fall by more than 24% before we would start to lose money.

CF hasn't been below $115 since early April and has shown support around $122 recently. This trade could be risky if the prices for oil fall and agricultural futures follow in the coming weeks, but even if that happens, that position could be protected by support the stock might find just above $120, where it bottomed out in May.

Brent Archer is an options analyst and writer at Investors Observer. At publication time, Brent neither owns nor controls positions in CF.

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Earnings highlights: Wal-Mart, Lehman Bros., Take-Two, Ciena, Trina Solar and others

Trey Thoelcke — 2008-06-07T09:10:00+00:00

Filed under: Earnings reports, Wal-Mart (WMT), Diageo plc (DEO), Ciena Corp (CIEN), Wachovia Corp (WB), Wells Fargo (WFC), Trina Solar ADS (TSL), Lehman Br Holdings (LEH), Potash Corp. of Saskatchewan (POT)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

Bob Evans Farms Inc. (NASDAQ: BOBE) posted stronger-than-expected Q4 earnings.
Ciena Corp. (NASDAQ: CIEN) beat earnings expectations, but share prices slipped anyway.
Daktronics Inc. (NASDAQ: DAKT) Q4 results beat expectations and it raised its revenue outlook.
Diageo (NYSE: DEO) is recession-proof and should deliver solid results, predicts one adviser.
Donaldson Company Inc. (NYSE: DCI) beat Q3 expectations and raised its full-year guidance.
Ensco International Inc. (NYSE: ESV) was upgraded because of its earnings growth potential.
Lehman Brothers Holdings Inc. (NYSE: LEH) earnings prospects don't impress Jim Cramer.
Netezza Corp. (NYSE: NZ) beat Q1 expectations and offered full-year revenue guidance.
Potash Corp. (NYSE: POT) earnings are "set to soar" says one analyst, due to rising demand and prices.
Sherwin-Williams Co. (NYSE: SHW) lowered its Q2 and full-year forecasts, sending shares down.
Take-Two Interactive Software Inc. (NASDAQ: TTWO) beat Q2 estimates on Grand Theft Auto IV demand.
Trina Solar Ltd. (NYSE: TSL) beat Q1 estimates but shares fell on the disappointing Q2 outlook.
Wal-Mart Stores Inc. (NYSE: WMT) was upgraded due to its earnings outlook and increased productivity.

Also, continued real estate losses are expected to hurt the quarterly reports of banks such as like Wachovia (NYSE: WB), Wells Fargo (NYSE: WFC), and National City (NYSE: NCC). And Steven Mallas wonders why Playboy (NYSE: PLA) shares have tanked since its last earnings report.

Upcoming results to watch for include Krispy Kreme (NYSE: KKD), Pall Corp. (NYSE: PLL), Pep Boys (NYSE: PBY), Korn Ferry (NYSE: KFY), and Casey's General Stores (NASDAQ: CASY).

Visit AOL Money & Finance for more earnings coverage.

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Potash (POT): Fertilzer 'breakout'

Steven Halpern — 2008-06-06T11:55:00+00:00

Filed under: Newsletters, Canada, Commodities, Agriculture, Stocks to Buy, Potash Corp. of Saskatchewan (POT)

"Potash (NYSE: POT) scored a technical breakout by rising above $210," says technical expert Leo Fasciocco. In his Ticker Tape Digest, he says, "With earnings set to soar the stock now targets a move to $265."

"Postash, based in Canada, produces fertilizer. It produces phosphate and nitrogen from 12 facilities in the United States and South America. Fertilizer stocks have been strong due to rising profits reflecting strong demand for their products and rising prices.

"A long term chart shows an extraordinary bull market advance with the rising 170% the past 12 months versus an 8% decline in the S&P 500 index. Now, the stock has broken out from a seven-week flat base. The move carries POT to a new high on expanding volume.

"The stock's recent action showed aggressive institutional buying. The momentum indicator is solidly bullish and the accumulation - distribution line has hit a new high and compliments the price action. The key will be for POT to follow through on the upside with expanding volume.

"Strong demand for fertilizer products is sending POT's earnings soaring. This year, analysts project a 222% surge in net to $10.95 a share from $3.40 a year ago.

"The stock sells with a price-earnings ratio of only 19. We see that as low given projected earnings growth of 51% next year with net climbing to $16.56.

"Based on 2009 net, the stock has a p/e ratio of just 7. So, on a valuation basis POT should have more to go on the upside. Also, the stock is positioned for a possible stock split which could spark a move higher. Overall, POT remains 'hot.' We are targeting the stock for a move to 265 within the next few months. A protective stop can be placed near 205."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

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Fab Five: 5 promising stocks for patient investors

Joseph Lazzaro — 2008-06-05T14:50:00+00:00

Filed under: Freep't McMoRan Copper (FCX), Stocks to Buy, Potash Corp. of Saskatchewan (POT)

In a challenging market amid an uncertain U.S. economic landscape, identifying long-term, promising investment opportunities becomes a difficult task. Further, to make the investment equation even more challenging, there's election risk, as well, with the 2008 U.S. Presidential election five months away.

Still, risk-adjusted investment opportunities exist. Accordingly, here's a 'Fab Five' that should rank with the best the equity markets have to offer, 3-5 years out.

(Note: Don't buy these stocks if you're interested in a short-term trade of six months or less. These are longer-term investments where the goal is a double-digit, average, annual, total return on equity over 3-5 years.)

Potash (NYSE: POT). Current Price: $212, p/e 47. Revised Stop Loss: $170. Potash remains the best of a very good fertilizer bunch, due to its 20% global market share in the namesake fertilizer. Consider buying POT on a pull-back to $202-203, but keep in mind Potash may not retreat to that level.

Mosaic (NYSE: MOS). Current Price: $132, p/e 40. Revised Stop Loss: $97. Mosaic also is well-positioned in phosphate and crop nutrients. Further, the fact that 66% of its revenue is internationally based is especially appealing, given the U.S. economic slowdown.

Transocean (NYSE: RIG). Current Price: $144, p/e 10. Revised Stop Loss: $110. RIG offers deepwater oil drilling services in all regions of the world, and it's an oil-thirsty world.

Freeport-McMoRan (NYSE: FCX). Current Price: $114, p/e 14. Revised Stop Loss: $69. Copper / gold / molybdenum miner Freeport is one of a handful of companies that have the economies of scale to compete in the global mining sector of the early 21st century, and it boasts impressive clients, to boot. Consider buying FCX on a pull-back to $111-113, but keep in mind Freeport may not retreat to that level.

CSX Corp. (NYSE: CSX). Current Price: $66, p/e 23. Revised Stop Loss: $48. Ride the railroad resurgence with this superior trade / commodity / freight transport company. The rails are in the transportation sweet spot: truck transport costs are rising with fuel costs, and the U.S. highway system is inadequate, with increased congestion likely, pending future investment.

Top Pick: Potash.

Safest Pick: CSX Corp.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.

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Investing in Everyone: Defense, Food, Power, Clinton, Obama, and McCain

Sheldon Liber — 2008-05-27T19:05:00+00:00

Filed under: International markets, Other issues, Rants and raves, Archer-Daniels-Midland (ADM), Duke Energy (DUK), Politics, Presidential elections, General Dynamics Corp (GD), Southern Company (SO), Raytheon Company (RTN), Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT)

I have not decided who I am voting for yet. Or maybe it would be more accurate to say I have decided on multiple occasions only to become undecided again. While some will see me as fickle, or worse, others may be in the same boat.

I am also continuing to think about what difference any of the candidates can make on the economy, and based on these musings, where to invest. My current belief is that none of them will have a profound impact on our economy.

There are no financial wizards among them. Here is the shocker though: I like all three candidates, or at least can find some good in each of them. Each of them is a fighter, and I believe each one of them brings certain skill sets to the job. There are also things about each candidate that are inescapably negative. Clinton has so much baggage, Zsa Zsa Gabor would be jealous. Obama does not have the experience and he has a degree of arrogance (right sweetie); McCain is an old stick-in-the-mud who, as a long-time senator, has spent more hours with lobbyists than almost anybody, though he is pretending otherwise.

Where does this leave me from an investment perspective? My first choice, for stability with moderate growth and dividends, remains the defense sector. I wrote Defense sector rolls over S&P 500 for 8th straight year a while back and I still think that it is the most secure. Here's why:

A) None of the candidates will want to appear soft on defense when we are at war, and all three have made threatening remarks in some country's direction to make sure the electorate knows that.

B) The War in Afghanistan and Iraq rages on, and even the most optimist view is that a draw-down will take years.

C) Even if all war ceased immediately, the upgrading and replenishment of the hardware will cost billions of dollars and most of the defense contractors have that in their backlogs now. Chasing Value: General Dynamics & Raytheon -- The defense does not rest

Mike Huckabee made news by suggesting he would be delighted to pair up with John McCain as his VP running mate. He is another guy that has a real hunger to be heard, but has no interest in a real job. While this may strengthen the party ticket, shoring up conservative support, historically successful candidates move to the center in the general election. Huckabee would lose him as many votes as he would gain.

Nobody is more hungry to be president then Hillary Clinton, who may view this go-around as her one shot at the oval office, since the next occupant could be there eight years if they don't screw up too bad (right Dubya).

Hillary Clinton is doing some big time pandering to stay in the presidential race, and does not look like she has lost any of her fight yet. She seems to be the most polarizing of the three candidates, because there are many that simply do not trust her. Oddly, if this were any other type of race, trust might not be an issue, just success -- and an argument could be made that she might be the most successful. For all her husband's problems in office, the economy was humming and legislation was moving.

There are a growing number of hungry folk -- the continuous rise in food prices has supported one of my thesis from last December Serious Money: ADM, Bunge, Potash Corp. -- it's a hungry world and I expect, like the defense sector this is still a smart place to be investing, although these three stocks are on the pricey side. However, who is to say they have topped out. Archer-Daniels-Midland (NYSE: ADM), Bunge Ltd. (NYSE: BG) and Potash Corp. of Saskatchewan (NYSE: POT) dominate a major portion of he world market in grains, oils and fertilizers.

A) Our sinking dollar makes our prices on the world market more competitive.

B) China, Russia, India, Brazil -- the whole world for that matter have been adding more meat to their diets and that is raising the price of everything. The number of capitalists has doubled!

C) Diets will change in tough economic times, but food will remain a higher priority than most everything else.

Looking beyond the economics of guns and butter for other themes and hearing every day the drum beat that change is afoot, I wonder where else things might remain stable or grow. What comes to mind is power, and I have thought this for quite some time -- Serious Money: Electric utilities are the place to be. I still like the Southeast U.S. and own stock in Duke Energy (NYSE: DUK) and the Southern Company (NYSE: SO) for the long haul.

A) Power companies will be open for business every day of the year and pay solid dividends.

B) Even if housing is down and foreclosures are increasing, someone will own the homes and they will still need the power company.

C) The increase in consumer products requiring power, and the movement toward electric vehicles, will increase demand.

Speaking of a newcomer that seeks power -- Barack Obama promotes himself as the candidate of change. I ask, CHANGE WHAT? Does he think he can become more touchy-feely, like Jimmy Carter, and make nice to everyone? That did not work. He wants to bring us all together, but that's not going to happen. Some folks want to eliminate capital gains taxes and others want to raise them; some want to stop all abortions and others want a women to have a right to choose; and some want health care coverage to be provided by the private sector and others want the government to take over. There will have to be a compromise, but there will be a battle royale to get there.

The Democrats are happy to run against Bush, because even many Republicans would not like to do the Bush economy over again and economics does not seem to be McCain's strong suit anyway. If Obama is the survivor of the political process ("winner" does not seem apt), the biggest surprise will be the economy. Since he is the biggest wild-card, we may see the market go soft, at least in the short term, if he is elected.

One of the most fascinating things about the economy, reported on this site and in business journals, is that the economy often does the best when there is a log jam in Washington and nothing happens. Maybe the economy would improve the fastest if Bush left office and we had a one-year moratorium in Washington and they all just went home. There was a time, a long time ago, when that's how it was.

No matter who wins the election, I think the defense, food and energy sectors will remain strong and the housing sector, airlines, and retail remains weak for a few more years. In this case the past may be a good predictor of the future.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares in DUK, GD & SO.

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Profit from peaking potash and phosphate prices

Peter Cohan — 2008-05-27T10:00:00+00:00

Filed under: Stocks to Buy, Potash Corp. of Saskatchewan (POT)

Farmers are paying more for supplies to grow their crops and they're passing those rising costs onto consumers. The Wall Street Journal reports that farmers paid 65% more for fertilizer in April 2008. Fuel, the second-fastest rising cost, is up 43%. And seed prices have risen 30%. But you can hedge your rising food costs by investing in companies that profit from rising fertilizer prices.

Farmers say too much market power is concentrated in the hands of a small group of companies in the U.S., Canada and Russia that dominate global production of potash and phosphate. Phosphate is up 174% from $365 last year to $1,000 a ton. The price of a ton of potash is up 204% from $230 to $700. Thanks to a rise in natural gas prices, the price of Urea, a nitrogen fertilizer, has doubled to $600 a ton.

Should you hedge your rising food prices by buying stock in Potash and seed suppliers? Potash Corp. (NYSE: POT) and Mosaic Corp. (NYSE: MOS) have benefited from the rising price of Potash. And Monsanto Co. (NYSE: MON) is the biggest seed company out there. They have benefited in the past year -- with stock prices up 202%, 279%, and 103% respectively. But will they keep rising?

Potash. At a Price/Earnings to Growth ratio (PEG) of 0.8 on a P/E of 45.4 and earnings forecast to grow 60% through 2009, this stock looks pretty cheap and could be a buy.
Mosaic. At a PEG of 0.2 on a P/E of 37.5 and earnings forecast to grow 191% through 2009, this stock looks cheap. It could be a screaming buy.
Monsanto. At a PEG of 2.0 on a P/E of 40.8 and earnings forecast to grow 20% through 2009, this stock is not cheap. I'd call it a hold.

If you want to profit from peaking potash and phosphate prices to hedge your rising cost of food, consider investing in Mosaic and Potash.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in the securities mentioned.

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Cramer on BloggingStocks: Oil's not the widespread tax it used to be

Jim Cramer — 2008-05-19T09:22:00+00:00

Filed under: General Electric (GE), Exxon Mobil (XOM), Market matters, Halliburton (HAL), Schlumberger Limited (SLB), Alcoa Inc (AA), Archer-Daniels-Midland (ADM), Bank of America (BAC), Boeing Co (BA), Chesapeake Energy (CHK), Chevron Corp (CVX), duPont(E.I.)deNemours (DD), Office Depot (ODP), Deere and Co (DE), Honeywell Intl (HON), United Technologies (UTX), Eaton Corp (ETN), Anadarko Petroleum (APC), Oil, Stocks to Buy, Burlington Northern Santa Fe (BNI), Norfolk Southern Corp. (NSC), Union Pacific Corporation (UNP), Cramer on BloggingStocks, Potash Corp. of Saskatchewan (POT)

TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.

Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.

Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.

Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.

Or how about all of the companies involved with process and flow control and efficient motors: Parker-Hannifin (NYSE: PH) (Cramer's Take), Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Flowserve (NYSE: FLS) (Cramer's Take). Those work higher with higher energy prices. CSX (NYSE: CSX) (Cramer's Take), Burlington Northern (NYSE: BNI) (Cramer's Take), Kansas City Southern (NYSE: KSU) (Cramer's Take), Union Pacific (NYSE: UNP) (Cramer's Take) and Norfolk Southern (NYSE: NSC) (Cramer's Take) are smaller energy users than trucks, and they ship plenty of ethanol and fertilizer.

Of course everything farming: Deere (NYSE: DE) (Cramer's Take), Monsanto (NYSE: MON) (Cramer's Take), Du Pont (NYSE: DD) (Cramer's Take), AGCO (NYSE: AG) (Cramer's Take), Potash (NYSE: POT) (Cramer's Take), Agrium (NYSE: AGU) (Cramer's Take), Mosaic (NYSE: MOS) (Cramer's Take) and Archer Daniels (NYSE: ADM) (Cramer's Take) (these are big companies in market cap now, powers of the S&P or companies just waiting to get into the S&P but stalled by a lack of mergers). And everything that drills, ships and transports oil and gas: Rowan (NYSE: RDC) (Cramer's Take), Parker (NYSE: PKD) (Cramer's Take), Weatherford (NYSE: WFT) (Cramer's Take), Cameron (NYSE: CAM) (Cramer's Take), Noble (NYSE: NE) (Cramer's Take), Transocean (NYSE: RIG) (Cramer's Take), FMC Tech (NYSE: FTI) (Cramer's Take), Oceaneering (NYSE: OII) (Cramer's Take) and so many others -- and of course, Halliburton (NYSE: HAL) (Cramer's Take) and Schlumberger (NYSE: SLB) (Cramer's Take).

And then there is oil and gas itself, ever a larger portion of the S&P. Look at the charts during last week's run: Apache (NYSE: APA) (Cramer's Take), Anadarko (NYSE: APC) (Cramer's Take), Nabors (NYSE: NBR) (Cramer's Take), Exxon (NYSE: XOM) (Cramer's Take), Chevron (NYSE: CVX) (Cramer's Take), Occidental (NYSE: OXY) (Cramer's Take), XTO (NYSE: XTO) (Cramer's Take), Southwestern (NYSE: SWN) (Cramer's Take), Chesapeake (NYSE: CHK) (Cramer's Take), Ultra (NYSE: UPL) (Cramer's Take): these all count.

Coal, of course, is a huge beneficiary. Infrastructure works because these companies get the benefits of the oil companies' largesse by being able to build energy-related production centers.

Even the autos can be viewed as benefitting, as the newer cars use less gas than the old ones, making them viable alternatives in multiyear paybacks. Along those lines, energy-efficient appliances get a boost.

Then there are the myriad energy-alternative plays that are always dominating the headlines but haven't yet made it into the S&P or are very small parts of the S&P: the wind plays -- Trinity (NYSE: TRN) (Cramer's Take), Woodward Governor (NASDAQ: WGOV) (Cramer's Take), Owens Corning (NYSE: OC) (Cramer's Take) (also insulation); solar -- First Solar (NASDAQ: FSLR) (Cramer's Take) ($24 billion market cap), SunPower (NASDAQ: SPWR) (Cramer's Take), and all the Chinese plays that people love so much.

Pipelines galore: Kinder Morgan (NYSE: KMP) (Cramer's Take), Enterprise (NYSE: EPD) (Cramer's Take), Boardwalk (NYSE: BWP) (Cramer's Take), so many others.

Many companies are neutral -- financial, telco, utilities -- although some benefit from the price umbrella of higher oil costs and can pass on costs they don't have. Tech's been fairly neutral. The weaknesses we have seen in tech are related to consumer slowdown (customers such as Office Depot (NYSE: ODP) (Cramer's Take)) or financial. Media's neutral, too. Health care can't be considered a negative either when it comes to energy consumption.

Most of the conglomerates say they are energy-positive: United Tech (NYSE: UTX) (Cramer's Take) and, famously, GE (NYSE: GE) (Cramer's Take), which has said that its fortunes should improve as oil goes higher, although we haven't seen that yet.

We know there are plenty that don't. Anything that is sold in the supermarket. Anything retail. Anything that uses oil or natural gas and can't really pass it on: Minerals and mining (although global demand really helps), glass (although recycling really helps, as in the case of Owens-Illinois (NYSE: OI) (Cramer's Take)), and chemicals and the paper producers.

But those companies aren't that important anymore, even though they dominate the consciousness of the marketplace, despite the encroachment of energy as a part of the S&P 500.

In fact, if finance could turn itself around -- something that seems increasingly possible, although it has sucked up a huge amount of capital and done nothing -- you could argue that we are on the cusp of a major move as it dawns on people that energy isn't the tax it used to be.

There are plenty of 30,000-foot flaws to this. We have seen time and again that our own growth in this country is heavily consumer-related. But the industrial growth owes itself not to the U.S. consumer, but the worldwide consumer.

All of these facts can go far toward explaining how higher oil prices have not been able to block the advance of the S&P or the Dow Jones averages. In fact, if the latter were more responsive to energy -- the Chevron nod was accompanied by ne'er-do-well Bank of America (NYSE: BAC) (Cramer's Take) instead of a Deere or another oil play like an Occidental or a Schlumberger -- we would be taking out 13,000 with ease.

All of this is worth thinking about when you are gloomy, because it doesn't add up to a decline, it explains the advance.

Keep it in mind during the next downturn. It explains a lot why they've been fairly shallow.

And I don't expect anything deeper now that finance seems to have stabilized.

RELATED LINKS:

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long XTO and Owens-Illinois.

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Analyst downgrades: IVAC, SUN, UAUA, CAL, PVTB and POT

Eric Buscemi — 2008-04-29T12:28:00+00:00

Filed under: Analyst reports, Analyst upgrades and downgrades, UAL Corp (UAUA), Potash Corp. of Saskatchewan (POT)

MOST NOTEWORTHY: Intevac, PrivateBancorp and Potash were today's noteworthy downgrades:

Intevac (NASDAQ: IVAC) was downgraded to Sell from Neutral. Piper downgraded Intevac citing delays in Gen2 upgrades following Q1 results.
Sandler downgraded PrivateBancorp (NASDAQ: PVTB) following its Q1 earnings results.
RBC Capital downgraded Potash (NYSE: POT), and advised taking some profits.

OTHER DOWNGRADES:

Soleil downgraded Sunoco (NYSE: SUN) based on weak East Coast refining margins and low marketing and chemical margins.
Calyon downgraded UAL (NASDAQ: UAUA) based on higher fuel costs and the failed merger with Continental (NYSE: CAL).

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Three stocks for the food boom: Potash, Mosaic, Agrium

Joseph Lazzaro — 2008-04-25T17:09:00+00:00

Filed under: Commodities, Agriculture, Stocks to Buy, Potash Corp. of Saskatchewan (POT)

Readers of this space know that the preferred tack is to look for well-capitalized companies with competitive advantages in sectors with secular, long-term growth trends. One select sector has been oil/oil services, and another right near the top has been fertilizer producers, primarily Potash, Mosaic, and Agrium, first reviewed in December 2007-January 2008.

To be sure, the sector has been bid-up, as a wider community discovers the value of fertilizer and companion products amid the likely substantial increase in global food demand in the decade ahead.

Too late to get in on a fertilizer play? Hardly. P/Es are higher, so entry point is key, but with the above in mind, here's a revised review of the fertilizer producers, with the updated Sell/Stop Loss levels. They're ranked by risk, with the top stock, POT, being the lowest risk.

Potash Corp./Saskatchewan (NYSE: POT), December 28, 2007 price: $141, p/e 50. Stop Loss: $85. Current Price: $203, p/e 62. Revised Stop Loss: $170.

Potash remains the best of a very good bunch, due to its 20% global market share in the namesake fertilizer. Ideally, buy Potash on a pull-back to $185 or $180, as it's overbought, short-term, but keep in mind that POT may not pull back to that level.

The Mosaic Company (NYSE: MOS), January 14, 2008 price: $101, p/e 35. Stop Loss: $64. Current Price: $130, p/e 42. Revised Stop Loss: $97.

Mosaic also is well-positioned in phosphate and crop nutrients. Further, the fact that 66% of its revenue is internationally-based is especially appealing given the U.S. economic slowdown. Ideally, buy MOS on a pull-back to $120 or $115.

Agrium Inc. (NYSE: AGU), January 11, 2008 price: $72, p/e 30. Stop Loss: $43. Current Price: $88, p/e 27. Revised Stop Loss: $72.

A leader in nitrogen production, Agrium has large operations in the U.S. and South America, the former of which creates higher risk than POT or MOS. A better entry price for AGU would be closer to $80, but keep in mind AGU may not retreat to that level.

Stocks Analysis: POT, MOS, and AGU are moderate-risk stocks not suitable for low-risk investors. Top Pick: POT.

Disclosure: Lazzaro has no positions in stocks. In addition to private real estate holdings, he owns corporate and municipal bonds, and cash certificates of deposit.

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