Stock of the Week
Gigamon Inc. (GIMO)

Gigamon (GIMO) designs software and hardware that steers information on computer / telecommunications networks, including video, voice and data, to the appropriate destination. The company’s products help IT managers of enterprises, data centers and service providers to monitor their networks and maintain network performance. The company maintains relationships with vendors of network management, analysis and security tools, including Check Point Software, Cisco Systems, Fortinet, FireEye, Imperva, Palo Alto Networks, Riverbed Technology, SolarWinds, VMware, Inc. and Viavi Solutions.

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Significant Developments

Stocks Due for a Big Pullback on Political Inactions and Weakening Economic Data

July 18, 2017 (9:00 pm U.S. Eastern Time)

An increasing number of signs are indicating that stocks are due for a big pullback. For example, the Republicans have made no meaningful progress on passing a new healthcare bill, and a budget bill released today by the U.S. House of Representative’s indicates that the Congress will not implement President Trump’s income tax proposals anytime soon. Meanwhile, data released today by the National Association of Home Builders indicate that the U.S. housing market is continuing to weaken.

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Frazier Buy-Sell Index
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U.S. Economic Developments

U.S. Housing Market Showing Signs of Further Weakening

July 18, 2017

Data released today by the National Association of Home Builders (“NAHB”) indicate that the U.S. housing market will continue to weaken over the next couple of months, with the NAHB reporting that its housing market index declined during mid-July for the second consecutive month and to its lowest level since November 2016. That’s a very negative development because the U.S. economy and U.S. stock prices, in general, have historically moved in the same direction as the NAHB’s Housing Market Index.
  NAHB Housing Market Index
U.S. Political Developments

Republicans’ Budget Bill Indicates Congress will Not Implement President Trump’s Tax Proposals

July 18, 2017

A government budget bill introduced today by the U.S. House of Representatives indicates that the House will not implement President Trump’s income tax proposals anytime soon, with the text introducing the bill stating, “The resolution also instructs the Ways & Means Committee to produce deficit-neutral tax-reform legislation ....”

Considering the fact that the bill includes a request for substantial increases in military spending, and that the Congressional Budget Office ... continue reading >

 
Earnings Announcements

Bank of America, Goldman Sachs, Harley-Davidson and 32 Other Companies Announce Second Quarter Operating Results

July 18, 2017

Bank of America (BAC) reported that its net income rose by 10.2% on a 7.2% increase in the company’s revenues, a 25.6% decline in its provision for credit losses and a 1.7% increase in its operating expenses for the quarter ended June 30, 2017, as compared to the same period a year ago.

Goldman Sachs (GS) reported that its net income rose by 0.5% on a 0.6% decrease in the company’s ... continue reading >

Click Here for All Q2 2017 Earnings

International Economic Developments

China’s Economy Improves during Second Quarter of 2017

July 17, 2017

Data released today by China’s National Bureau of Statistics (“NBS”) indicate that the country’s economy improved during the quarter ended June 30, 2017.

Specifically, China’s NBS reported that the country’s gross domestic product (“GDP”) rose at a 6.8% annualized rate for the three months ended June 30 ... continue reading >

 
International Geopolitical Developments

Moody’s Upgrades Greece’s Sovereign Debt Rating

June 23, 2017

Moody’s Investors Service reported today that it upgraded Greece's sovereign bond rating to Caa2 from Caa3 in response to improvements in Greece’s fiscal prospects and the country’s economy, and the release of an €8.5 billion ($9.5) tranche from Greece’s international lenders.

Additionally, Moody’s reported that it changed its outlook for Greece’s debt to positive from stable.

Company and Stock News
July 18, 2017
  • Puma Biotechnology (PBYI): Puma Biotechnology, Inc. announced yesterday evening that the U.S. Food and Drug Administration approved the company’s once-daily oral treatment for adult patients with early-stage breast cancer, NERLYNX. The company expects its NERLYNX treatment to be commercially available by September of this year.

  • Harley-Davidson (HOG): Harley-Davidson, Inc. announced that it reduced its estimates for the company’s shipments of motorcycles to a range of 241,000-246,000 for the full-year ending December 31, 2017, which would be approximately 6%-8% lower than during 2016. For the quarter ending September 30, 2017, the company stated that it expects to ship 39,000-44,000 motorcycles, which would be approximately 10%-20% lower than shipments for the same quarter a year ago. Additionally, the company said it expects its full-year operating profit margin to be approximately one percentage point lower than during the prior year.

  • IMAX Corp. (IMAX): IMAX Corporation announced that it signed an agreement with Shanghai Bestar Cinemas Management Co. Ltd. to open seven new theatres in China. The company said the theatres will be added to new multiplexes across Tier Two and Tier Three cities, with six of the theatres scheduled to open this year and the remaining theatres to open during 2019.

  • Wal-Mart (WMT): Wal-Mart Stores, Inc. announced that it opened a new e-commerce fulfillment center in Davenport, Florida. The 50-acre campus, which is located near the intersection of I-4 and Highway 27 in Polk County, features two buildings spanning a total of more than 2.2 million square feet. The company said it employs more than 550 people at the facility and expects to add another 1,000 employees during 2018.

  • PayPal Holdings (PYPL) and Visa (V): PayPal Holdings, Inc. and Visa Inc. announced that the companies are extending their strategic partnership to Europe, whereby PayPal will use its banking license in Europe to join the Visa network of financial institutions and offer Visa accounts in Europe for persons to use wherever Visa is accepted. PayPal will also have access to the Visa Digital Enablement Program, which enables users to make secure payments on mobile phones or other connected devices.

More Company and Stock News >

Stock Coverage

GROWTH STOCKS

Company & Ticker Sector / Industry Investors Monitor Grade
(As of Initial Coverage Date)
Initial Coverage Date & Price Rating on Initial Coverage Date
Product Financial Liquidity Long-term Debt Profit Margins Sales & EPS Growth PEG Ratio Institution Buys to Sells Timing
Semiconductor Manufacturing International (SMI) Technology / Semicond B+ A+ B+ B+ A 0.6 C A 04/10/17
$6.18
A
Semiconductor Manufacturing International Corporation provides contract manufacturing services to semiconductor design companies. The company operates seven factories in China and manages two manufacturing facilities owned by the Chinese government. Approximately 50% of the company’s revenues are generated from sales in the United States.
 
Solar Edge Technologies (SEDG) Energy / Solar Panels A A+ A A A 0.7 A A 12/23/16
$12.65
A
SolarEdge Technologies manufactures solar photovoltaic (“PV”) systems that maximize power generation and lower the cost of energy produced by those systems. The company’s products serve a wide variety of solar market segments, from residential solar installations to commercial and small utility-scale solar installations. Its products have been installed in solar PV systems in more than 70 countries around the world.
 
Qualys (QLYS) Technology/ Internet Security A A+ A+ B+ A 2.3 C C 11/28/16
$33.75
C
Qualys is a leading provider of cloud-based security and compliance applications that enable organizations to identify security risks to their IT infrastructures, to protect their IT systems and applications from ever-evolving cyber attacks, and to achieve compliance with internal policies and external regulations. The company’s integrated suite of security and compliance applications, delivered on its QualysGuard Cloud Platform, enables its customers to identify their IT assets, collect and analyze large amounts of IT security data, discover and prioritize vulnerabilities, recommend remediation actions and verify the implementation of such actions. The company provides its applications through a software-as-a-service model, primarily with renewable annual subscriptions. Those subscriptions require customers to pay a fee to access the company’s cloud-based applications. The company has approximately 8,800 customers in approximately 100 countries around the world, including a majority of each of the Forbes Global 100 and Fortune 100 companies.

TURNAROUND SITUATIONS

Company & Ticker Sector / Industry Frazier Grade
(As of Initial Coverage Date)
Initial Coverage Date & Price Rating on Initial Coverage Date
Product Financial Liquidity Long-term Debt Profit Margins Sales & EPS Growth PEG Ratio Institution Buys to Sells Timing
Sears Holdings (SHLD) Retail Dept. Stores B B D+ n/a F n/a A A

02/22/17
$8.06

A
Sears Holdings is the world’s 31st largest retailer, operating more than 1,600 Sears and Kmart stores in the United States and Canada. The company is the leading U.S. retailer of home appliances, tools, lawn and garden goods, fitness equipment and automotive repair services, and it’s the nation's largest provider of home services, with nearly 12 million service and installation calls made annually.
 
Cliffs Natural Resources (CLF) Basic Materials / Iron Ore A A- F n/a D n/a C A

01/13/17
$9.23

A
Cliffs Natural Resources produces iron ore pellets, a key component of steel making, and owns or holds stakes in five iron ore properties that account for more than half of the United States’ total iron ore production capacity. While the company sells its ore primarily in North America, it has a growing number of iron ore interests in the Asia/Pacific region and in Latin America.
 
Lumber Liquidators (LL) Retail Stores / Flooring  A B A n/a D n/a C B+

01/12/17
$15.47

B+
Lumber Liquidators is one of the larger retailers of hardwood flooring in the United States. The company sells more than 25 domestic and exotic species of hardwoods from more than 340 stores in approximately 45 U.S. states and Canada, as well as over the Internet, by catalog, and from its Virginia call center. The company also offers antique and reclaimed boards, laminate flooring, moldings, and installation products.
 
Restoration Hardware (RH) Retail Stores / Furniture  A B C+ n/a D n/a D B+

12/16/16
$21.37

B+
Restoration sells up-scale home and outdoor furnishings, garden products, hardware, bathware, lighting, textiles, and baby and child products through approximately 85 retail and outlet stores in 30 U.S. states, the District of Columbia, and Canada.


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