With financial eyes once again on the Federal Reserve, the Dow Jones Industrial Average (DJINDICES: ^DJI ) closed down modestly today, falling 37 points, or 0.2%. The Fed's Open Market Committee is meeting today and tomorrow and will report the results of its eight-times-a-year meeting on Wednesday, giving investors the latest insights as to when the central bank may begin tapering its $85 billion monthly stimulus program.
Today, only one economic report was released -- June pending home sales, which showed a decrease of 0.4% from May, but that number was better than economists' projection of a 1.7% drop. Increasing mortgage rates, which have gone up as the Fed threatens to cut its Treasury bond purchases, are putting pressure on the housing recovery. Still, sales are just a hair off the six-year high it hit in May.
On the Dow today, Caterpillar (NYSE: CAT ) led all comers, finishing up 1.2% after announcing it will buy back $1 billion of its shares from French bank Societe Generale, most of which it will purchase immediately. With the global mining industry in a down cycle, Caterpillar has struggled this year, falling last week after a forgettable earnings report that included a guidance cut. The share repurchase announcement would seem to indicate that management sees the stock as undervalued.
Top Dow Dividend Companies For 2015: Caterpillar Inc.(CAT)
Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. It operates through three lines of businesses: Machinery, Engines, and Financial Products. The Machinery business offers construction, mining, and forestry machinery, including track and wheel tractors, track and wheel loaders, pipelayers, motor graders, wheel tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, log loaders, off-highway trucks, articulated trucks, paving products, skid steer loaders, underground mining equipment, tunnel boring equipment, and related parts. It also manufactures diesel-electric locomotives; and manufactures and services rail-related products and logistics services for other companies. The Engines business provides diesel, heavy fuel, and natural gas reciprocating engines for Caterpillar machinery, electric power generation systems, marine, petrol eum, construction, industrial, agricultural, and other applications. It offers industrial turbines and turbine-related services for oil and gas, and power generation applications. This business also remanufactures Caterpillar engines, machines, and engine components; and offers remanufacturing services for other companies. The Financial Products business provides retail and wholesale financing alternatives for Caterpillar machinery and engines, solar gas turbines, and other equipment and marine vessels, as well as offers loans and various forms of insurance to customers and dealers. It also offers financing for vehicles, power generation facilities, and marine vessels. The company markets its products directly, as well as through its distribution centers, dealers, and distributors. It was formerly known as Caterpillar Tractor Co. and changed its name to Caterpillar Inc. in 1986. Caterpillar Inc. was founded in 1925 and is headquartered in Peoria, Illinois.
Advisors' Opinion:- [By Ben Levisohn]
Is Caterpillar (CAT) really in the Dow? The beaten down industrial stock has gained 3.1% to $89.95 today, more than one percentage point more than Alcoa (AA), the next biggest winner with a 1.9% gain. The Travelers Companies (TRV) has gained 1.9% to $81.99, and 3M (MMM) has climbed 1.5% to $116.78. The Dow Jones Industrial Average has risen 0.9%.
To put Caterpillar’s gain in perspective, its the stock’s largest jump since May 3, when it rose 3.2%. And with time still remaining today, it could advance even higher.
We’ll chalk the big move up to the better economic news out of China last night, as well as sentiment that the global economy is picking up steam. The Caterpillar is also an industrial stock, and those are pretty popular right now.
I wouldn’t make too much of the move just yet, however. For starters, Caterpillar has been stuck in a range since March, as the following chart shows:
And, as Morgan Stanley reminded investors last week, the market might be expecting too much from Caterpillar. On Sept 5, analyst�Nicole DeBlase and team wrote:
While we agree that Mining destocking activity should cease, we see risk to Construction restocking based on our survey work ��41% of both US and China Construction dealers still think inventory is too high, and plan to reduce throughout the remainder of 2013e. Should Construction activity not pick up materially in early 2014e, we see the potential for this to remain a headwind next year ��but we do still give CAT credit for 5ppts of top-line Construction benefit from restock in 2014e. We are more bearish on Mining CapEx as we do not expect the second derivative of cuts to turn positive until 2016e.
Mogran Stanley initiated the stock as an Equal Weight with an $89 price target.
- [By Rebecca McClay]
Building roads and bridges takes a lot of heavy equipment, and that's exactly what Caterpillar (CAT) makes. Whether a project needs backhoes, excavators, pavers or the articulated trucks to get asphalt and other building materials from one location to another, the Peoria, Ill., manufacturer is the industry leader both in the U.S. and abroad.
- [By Monica Gerson]
Caterpillar (NYSE: CAT) announced the retirements of Group Presidents Stu Levenick and Steve Wunning. Caterpillar named current Group President Ed Rapp as Wunning's replacement and Rob Charter as Levenick's replacement. Caterpillar shares fell 0.45% to $92.71 in the after-hours trading session.
10 Best Undervalued Stocks To Watch For 2014: Dollar Tree Inc.(DLTR)
Dollar Tree, Inc. operates discount variety stores in the United States and Canada. Its stores offer merchandise primarily at the fixed price of $1.00. The company operates its stores under the names of Dollar Tree, Deal$, Dollar Tree Deal$, Dollar Giant, and Dollar Bills. Its stores offer consumable merchandise, including candy and food, and health and beauty care, as well as household consumables, such as paper, plastics, household chemicals, in select stores, and frozen and refrigerated food; variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines, and other items; and seasonal goods, such as Easter, Halloween, and Christmas merchandise. As of April 30, 2011, it operated 4,089 stores in 48 states and the District of Columbia, as well as 88 stores in Canada. The company was founded in 1986 and is based in Chesapeake, Virginia.
Advisors' Opinion:- [By Nickey Friedman]
Dollar Tree (NASDAQ: DLTR ) continues to impress each quarter with robust sales, same-store sales growth, and diluted earnings-per-share increases. This dollar chain credits in large part a budget-conscious and cash-strapped consumer filling up its stores looking for bargains. Further growth seems like a no-brainer, but there are two things to watch for that could become speed bumps on its road to further riches.
10 Best Undervalued Stocks To Watch For 2014: Schlumberger N.V.(SLB)
Schlumberger Limited, together with its subsidiaries, supplies technology, integrated project management, and information solutions to the oil and gas exploration and production industries worldwide. The company?s Oilfield Services segment provides exploration and production services; wireline technology that offers open-hole and cased-hole services; supplies engineering support, directional-drilling, measurement-while-drilling, and logging-while-drilling services; and testing services. This segment also offers well services; supplies well completion services and equipment; artificial lift; data and consulting services; geo services; and information solutions, such as consulting, software, information management system, and IT infrastructure services that support oil and gas industry. Its WesternGeco segment provides reservoir imaging, monitoring, and development services; and operates data processing centers and multiclient seismic library. This segment also offers variou s services include 3D and time-lapse (4D) seismic surveys to multi-component surveys for delineating prospects and reservoir management. The company?s M-I SWACO segment supplies drilling fluid systems to improve drilling performance; fluid systems and specialty tools to optimize wellbore productivity; production technology solutions to maximize production rates; and environmental solutions that manages waste volumes generated in drilling and production operations. Its Smith Oilfield segment designs, manufactures, and markets drill bits and borehole enlargement tools; and supplies drilling tools and services, tubular, completion services, and other related downhole solutions. The company?s Distribution segment markets pipes, valves, and fittings, as well as mill, safety, and other maintenance products. This segment also provides warehouse management, vendor integration, and inventory management services. Schlumberger Limited was founded in 1927 and is based in Houston, Texas.
Advisors' Opinion:- [By Jonas Elmerraji]
Most of the selling last quarter took place in the energy sector -- and within it, no single stock got sold off as hard by funds as Schlumberger (SLB). All told, funds unloaded more than 4.57 million shares of the oil field servicer, a stake that's worth close to $430 million at current price levels. So, should you sell too? Not so fast.
Schlumberger is the biggest oil service company on the planet. The firm's revenues come from a menu of specialized field services such as seismic surveys and well drilling and positioning. In a nutshell, SLB's job is to pull oil out of the ground as efficiently as possible -- and with oil prices in freefall, SLB's value proposition matters more now than it did when crude was trading in the triple-digits. Oil firms turn to Schlumberger because the tasks they need to accomplish are too nuanced or proprietary to pull off in-house. And that gives the firm a deep economic moat.
Another part of SLB's deep moat comes from boots on the ground. Because Schlumberger is on-site at its clients' well locations, the firm is able to sell more complementary services at one time. The energy sector has gotten shellacked in the last few months, and frankly, that downward pressure isn't showing any signs of letting up. That said, SLB's revenues don't ebb and flow exactly in step with crude prices (unlike its clients), and shares look oversold here.
- [By Arjun Sreekumar]
Opportunities for oilfield services firms
Not surprisingly, Halliburton and other major energy companies view Chinese shale gas development as a significant opportunity for future growth. Many of them, including Baker Hughes (NYSE: BHI ) , ConocoPhillips (NYSE: COP ) , and Schlumberger (NYSE: SLB ) , have already developed strategic relationships with Chinese firms to better evaluate the nation's shale gas potential. - [By DAILYFINANCE]
Alamy HOUSTON -- Halliburton says it lost $18 million in the first quarter, pulled down by $637 million in charges related to its role in the 2010 Gulf of Mexico oil spill. But it made money if unusual items are excluded, beating Wall Street expectations. The oil services company's loss amounted to 2 cents a share. That compares with net income of $627 million, or 68 cents a share, a year earlier. Halliburton Co. (HAL), which is in talks to settle claims against it related to the oil spill, said that excluding the charges it posted adjusted earnings of 67 cents a share. That beat the 57 cents that analysts expected. The Houston company, which provides a variety of services for the petroleum industry, is benefiting from a boom in U.S. oil production, which is at the highest level in more than two decades. At the same time, Halliburton's natural gas business has slowed as drillers slowed production due to falling prices for the fuel. Revenue rose slightly to $6.97 billion from $6.87 billion. Analysts expected $6.88 billion. Halliburton shares jumped $1.44, or 3.9 percent, to $38.65 in premarket trading an hour before the market opening. Halliburton is the biggest provider of oil field services in North America, including hydraulic fracturing, a technology that has helped unlock large supplies of oil and natural gas from shale rock formations in the U.S. North American revenue fell 11 percent to $3.71 billion, while operating income tumbled 43 percent to $605 million. Dave Lesar, the company's chairman, president and CEO, said a drop in Halliburton's rig count and pricing pressures in North America were more than offset by the company's growing international business. International revenue increased 21 percent from a year ago. For the full year, Halliburton still expects total international revenue growth in the "low teens," he said. Rival Schlumberger Ltd. (SLB), which has a larger international business, said Friday that its revenue climbed in region
- [By Laura Brodbeck]
Notable earnings released on Friday included:
Morgan Stanley (NYSE: MS) reported third quarter EPS of $0.50 on revenue of $8.10 billion, compared to last year�� loss of $0.55 per share on revenue of $5.29 billion. General Electric Company (NYSE: GE) reported third quarter EPS of $0.36 on revenue of $35.7 3 billion, compared to last year�� EPS of $0.36 on revenue of $36.35 billion. Ingersol-Rand (NYSE: IR) reported EPS of $0.57 on revenue of $3.75 billion, compared to last year�� EPS of $1.07 on revenue of $3.59 billion. Schlumberger N.V. (NYSE: SLB) reported third quarter EPS of $1.29 on revenue of $11.61 billion, compared to last year�� EPS of $1.08 on revenue of $10.61 billion. Honeywell International (NYSE: HON) reported EPS of $1.24 on revenue of $9.65 billion, compared to last year�� EPS of $1.20 on revenue of $9.34 billion.Pre-Market Movers
10 Best Undervalued Stocks To Watch For 2014: Tupperware Corporation(TUP)
Tupperware Brands Corporation operates as a direct seller of various products across a range of brands and categories through an independent sales force. The company engages in the manufacture and sale of kitchen and home products, and beauty and personal care products. It offers preparation, storage, and serving solutions for the kitchen and home, as well as kitchen cookware and tools, children?s educational toys, microwave products, and gifts under the Tupperware brand name primarily in Europe, Africa, the Middle East, the Asia Pacific, and North America. The company provides beauty and personal care products, which include skin care products, cosmetics, bath and body care, toiletries, fragrances, nutritional products, apparel, and related products principally in Mexico, South Africa, the Philippines, Australia, and Uruguay. It offers beauty and personal care products under the Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics, Nuvo, and Swissgar de brand names. The company sells its Tupperware products directly to distributors, directors, managers, and dealers; and beauty products primarily through consultants and directors. As of December 26, 2009, the Tupperware distribution system had approximately 1,800 distributors, 61,300 managers, and 1.3 million dealers; and the sales force representing the Beauty businesses approximately 1.1 million. The company was formerly known as Tupperware Corporation and changed its name to Tupperware Brands Corporation in December 2005. The company was founded in 1996 and is headquartered in Orlando, Florida.
Advisors' Opinion:- [By John Kell]
Among the companies with shares expected to actively trade in Wednesday’s session are Dow Chemical Co.(DOW), Tupperware Brands Corp.(TUP) and Yahoo Inc.(YHOO)
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