Tag Archives: GM

Superior Industries Is A Buyout Candidate, Despite New Plant Build

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By Tim Travis:

In November of last year, I wrote about Superior Industries (SUP), which is one of the leading manufacturers of aluminum wheels. The appeal of the company as an investment was a pristine and cash-laden balance sheet, a decent business that has been pretty much operating at full capacity, generating adequate profits, and a stock trading at an extremely cheap valuation. All of these characteristics are still in place, but the stock has come down a bit after first rallying, due to management’s decision to allocate in excess of $125MM to build a new plant in Chihuahua, Mexico. The plant should lower the company’s overall cost structure and leverage its existing strength in Mexico, while obviously improving capacity as well. While Superior was a wonderful acquisition target prior to the capital allocation decision and it may be slightly less so after, I still believe the stock is too cheap and


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Wall Street Breakfast: Must-Know News

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Ballmer plans Microsoft reorganization. Microsoft (MSFT) CEO Steve Ballmer is reportedly planning to reorganize the company as he looks to foster better co-operation between product teams. Under one possible plan, Microsoft would put more focus on devices and services, and cut the number of divisions from eight to four. The groupings would be enterprise business, hardware, applications and services, and operating-systems. The speculation follows news that CIO Tony Scott has left the company.

AIG, Prudential, GE Cap to be labeled systemically important. As expected, the Financial Stability Oversight Council has proposed to designate AIG (AIG), Prudential Financial (PRU) and GE Capital (GE) as systemically important. Prudential is evaluating whether to appeal the proposed determination, although AIG won’t. The Fed has yet to finalize its requirements for systemically important non-bank financial companies, but they’re expected to include stress tests and higher capital holdings.

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Crumbling Dividend Stocks Give You Warnings

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author name submits:

As an income investor, one of my priorities is to satisfy two simultaneous desires: the protection of current income as well as the organic growth of an income stream over time at a rate greater than inflation. To state the obvious, the implication is that I do not want a portfolio stuffed with companies that could cut their dividends after I spend years putting together a nice position in them. When I review the histories of the fallen dividend darlings, there are usually strong signals ahead of time that may warn you that a dividend company is falling apart.

Let’s look at something like Eastman Kodak. The company basically spent 20+ years saying, "We’re not a dividend growth company anymore!" From 1989 to 1993, Kodak froze its dividend. From 1994 through 1996, the company froze its dividend. From 1997 to 2000, Kodak froze its dividend. Yes, during the most prosperous


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Time To Sell Ford Motor Company

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ByEquity Options Guru:

Since the near financial collapse of 2008/2009, automobile companies have seen significant rallies in share prices. One of the best performers since January 2009 has been Ford Motor Company (F). Ford shares have appreciated by an astonishing 498%. This is significantly better than the broader market (SPY), which has only appreciated by 93% over that same period. But instead of being excited about that, investors should thank their lucky starts and realize that now is the time to get out. Below are 3 reasons why investors should move rapidly to sell their existing long shares and / or initiate a short position.

Reason #1: Fundamental

On a fundamental basis, Ford simply isn’t what it used to be. Ford’s last annual statement was a complete disaster and sent the shares plunging. We can start by looking at Ford’s balance sheet. The first concern was Ford’s cash pile dropping (year over


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5 Reasons Hydrogenics Could Triple

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By Joe Springer:

We think that Hydrogenics Corporation (HYGS) is one of the most undervalued stocks in the market. Hydrogenics is the leader in the very large renewable energy storage market. It also has a fuel cell power systems business that addresses substantial emerging markets. Hydrogenics is on the cusp of profitability, and has some of the best intellectual property, partners, and contracts in its markets.

The five most important trends and catalysts for Hydrogenics are:

1) Renewable Energy Growth is a Major Trend Globally

  • Renewable Energy has Grown Substantially – Wind and solar energy have grown rapidly around the world.
  • Renewable Energy Is Becoming Economically Viable – Wind and solar energy are reaching “grid parity” in many places and becoming economically competitive with traditional energy sources.
  • Renewable Energy Should Grow Swiftly For a Long Time – Wind and solar energy are set to grow exponentially in the coming years.


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Wall Street Breakfast: Must-Know News

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Bain, Golden Gate close in on $6.5B BMC deal. Private-equity firms Bain and Golden Gate could reportedly announce a deal today to acquire BMC Software (BMC) for over $6.5B, with the $46-share-offer above the latter’s close of $45.42 on Friday. The proposed deal would follow pressure from activist investor Paul Singer for BMC to sell itself. Singer, who holds 9.7% in BMC, has criticized the company for failing to realize the opportunity in Internet-based business software.

P-E firms mull $8B Neiman Marcus exit. Neiman Marcus owners TPG Capital and Warburg Pincus are reportedly considering a sale or an IPO of the luxury retailer, with the private-equity firms believing that they can pull in $8B for the department-store chain after buying it for $5.1B in 2005. If a deal is struck, the valuation could be of interest to investors of mall rivals Saks (SKS) and Nordstrom (JWN).


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Wall Street Breakfast: Must-Know News

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Intel net profit slumps 25%. Intel’s (INTC) Q1 net profit fell 25% to $2.05B as the company continued to be hurt by the slump in the global PC market. Adjusted EPS of $0.40 slightly missed expectations while revenue slipped 2.5% to $12.58B and also undershot forecasts. However, Intel said it should recover in H2 and probably generate “double-digit revenue growth for the year,” boosted by the improving economy and sales of its Haswell chips for ultrabook computers. Shares were -0.5% premarket.

European car sales continue to plunge. European car registrations dropped for the 18th consecutive month in March, slumping 10% to 1.35M vehicles. Germany led the way as sales skidded 17%, while Spain, Italy and France all fell, although the U.K. rose 5.9%. GM’s (GM) registrations dropped 13%, Ford’s (F) 16% and Toyota’s (TM) 17%, although Honda’s (HMC) rose 17%. "People have stopped buying cars


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Wall Street Breakfast: Must-Know News

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Dish bids $25.5B for Sprint. Dish Network (DISH) has bid $25.5B in cash and stock for Sprint, with the $7-a-share offer representing a 13% premium to Softbank’s proposal to acquire 70% of Sprint for $20.1B. The bid is also 12.5% above Sprint’s close of $6.22 on Friday. The offer marks Dish’s boldest attempt yet to move into the cellular market; while the satellite-TV company has bought plenty of spectrum, it’s hit regulatory obstacles in its quest to use it for mobile purposes. Sprint was +10.9% premarket.

Precious metals in vicious sell-off. Gold futures (GLD) were -6.05% at $1416.80 an ounce premarket, continuing a sell-off that began last week and has turned into a full-scale stampede. A number of reasons have been given for gold’s free-fall, chief among them the ECB’s pressurization of Cyprus’ central bank to sell its gold reserves to help pay for


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