Patni Computers - Moving Ahead of Fundamentals?Shares of Patni Computers (PTI) have appreciated nearly 77% YTD (as of June 2nd), compared to the heavy-hitters in the industry: Infosys (INFY) up 43.6% YTD, Wipro Inc. (WIT) up 50.1% YTD, Cognizant Tech (CTSH) up 43.6% YTD and Tata Consultancy up 46.5% YTD. The only company in our coverage group in the IT/BPO Services sector with a market cap less than $1 billion, PTI's sharp upward movement apparently gives the impression that the stock may have moved ahead of the fundamentals. Or, are there other reasons behind such move?Shares of nearly all of the companies in the group got a boost immediately following the election results in India on May 17th, and PTI was no exception. Earlier, on April 29th, the company reported better than expected Q1 results with EPS of $0.23 versus consensus ...

OVERVIEW

The Biotech industry as a whole continues to underperform the market so far this year. As of May 26, 2009, Both the AMEX Biotech Index and the broader NASDAQ Biotech Index declined 6.8% (AMEX Biotech has 20 biotech companies while NASDAQ Biotech Index includes over 130 component companies), while the Dow Jones Biotech Index declined 3% (which includes 33 companies).

At the same time, both the NASDAQ Composite and S&P 500 have achieved positive returns. NASDAQ has made a gain of 11% as of 5/26/09 and the S&P 500 has gained 0.8%, while the Dow Jones Industrials reached a negative 3.5% return.

This constitutes a sharp contrast with last year when the Biotech industry as a whole achieved much better performance than the market. In 2008, all three biotech indices outperformed all three major market indices by a large margin. The three major indices declined as much as over 40% (34%, 41%

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OVERVIEWThe Biotech industry as a whole continues to underperform the market so far this year. As of May 26, 2009, Both the AMEX Biotech Index and the broader NASDAQ Biotech Index declined 6.8% (AMEX Biotech has 20 biotech companies while NASDAQ Biotech Index includes over 130 component companies), while the Dow Jones Biotech Index declined 3% (which includes 33 companies).At the same time, both the NASDAQ Composite and S&P 500 have achieved positive returns. NASDAQ has made a gain of 11% as of 5/26/09 and the S&P 500 has gained 0.8%, while the Dow Jones Industrials reached a negative 3.5% return.This constitutes a sharp contrast with last year when the Biotech industry as a whole achieved much better performance than the market. In 2008, all three biotech indices outperformed all three major market indices by a large margin. The three major indices declined ...

The Consumer Discretionary sector is one of the more intuitive sectors, with earnings driven by consumer spending.  The consumer-led nature of this recession has driven discretionary stocks south, with households cutting spending and increasing savings rates (to 3.6%). The companies that have faired the best over the 18 months have been those with strong balance sheets and large market caps that offer less discretionary product lines. Sub-sectors that have performed especially well are discount restaurants, discount retailers and education services. Subsectors hardest hit, on the other hand, include specialty stores, automotives, publishing, and gaming. Some of these sub-sectors, particularly automotive and publishing, have inherently flawed business models whose recover-ability is questionable. Others have been pulled down by their ultra-discretionary product lines as consumers cut big ticket items. Left in between are companies that offer products discretionary in nature but without the big-ticket price tag. These companies were heavily discounted as

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div style="text-align: justify;"Deutsche Banks is out upgrading span style="font-weight: bold;"McDonald's (NYSE:MCD)/span to Buy from Hold with a price tgt of $65 (prev. $60).br /br /span style="font-weight: bold;"According to the firm the upgrade is supported by:/span 1) compelling valuation, 2) positive upcoming catalysts and 3) attractive cash flow. The stock now trades at 13.6x forward 12- months EPS, the lowest multiple since early 2003 and below the 5-yr avg. of 16.0x and the restaurant industry avg. of 16.1x. Further, with the div. yield at an all-time high and the earnings outlook improving, they are moving to a Buy.br /br /span style="font-weight: bold;"Upcoming catalysts/spanbr /Deutsche analyst sees several upcoming catalysts for MCD that could provide upside to 2Hbr /forecasts and/or improve the valuation multiple. Key catalysts include: 1) McCafe (now in +10k locations vs. 1k a year ago; national advertising launched on May 5th), 2) easing commodity pressures (guidance looks conservative here) ...

Steve Madden Ltd. (...

Last year, the Biotech industry as a whole achieved much better performance than the market. Both the NASDAQ Biotech Index and AMEX Biotech Index outperformed all three major market indices (Dow Jones Industrial Average, NASDAQ Composite and S&P 500) in a large margin. The major indices declined as much as 40%. While NASDAQ Biotech Index declined only 12.6%, and AMEX Biotech Index was down 17.7%.

However, when the recession enters into its third year, the Biotech industry is not doing better than the market, which has been evident by the indices' performances. As of April 9, 2009, AMEX Biotech Index declined 3%, and the broader NASDAQ Biotech Index was down 6.8% (AMEX Biotech has 20 biotech companies while NASDAQ Biotech Index includes over 130 component companies). Although the Dow and S&P 500 also declined a similar percentage, technology-laden NASDAQ actually has a gain of 4.8%, which is more comparable to the

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Last year, the Biotech industry as a whole achieved much better performance than the market. Both the NASDAQ Biotech Index and AMEX Biotech Index outperformed all three major market indices (Dow Jones Industrial Average, NASDAQ Composite and S&P 500) in a large margin. The major indices declined as much as 40%. While NASDAQ Biotech Index declined only 12.6%, and AMEX Biotech Index was down 17.7%.

However, when the recession enters into its third year, the Biotech industry is not doing better than the market, which has been evident by the indices' performances. As of April 9, 2009, AMEX Biotech Index declined 3%, and the broader NASDAQ Biotech Index was down 6.8% (AMEX Biotech has 20 biotech companies while NASDAQ Biotech Index includes over 130 component companies). Although the Dow and S&P 500 also declined a similar percentage, technology-laden NASDAQ actually has a gain of 4.8%, which is more comparable to the

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