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11-18-09 Daily Small Cap Market News and Stock Highlights from SmallCapVoice.com

Stuart T. Smith — Wed, 18 Nov 2009 17:09:46 +0000

Stocks are lower as an unexpected drop in home construction raised concerns about the pace of the economy’s recovery The Commerce Department said construction of homes and apartments fell 10.6 percent in October to an annual rate of 529,000, well below the pace of 600,000 that economists polled by Thomson Reuters had predicted. Building permits, a key [...]

Agrium’s Profit Sinks – Analyst Blog

Zacks Market Commentaries — Fri, 06 Nov 2009 15:00:00 +0000

Agrium Inc. (AGU) reported adjusted net earnings of 29 cents per share in the third quarter of 2009, missing the Zacks Consensus Estimate of 32 cents. Year over year, earnings declined a significant 87% on lower volumes and prices. Revenues were down 41% year over year to $1.9 billion on weak corn prices and lower consumption of crop protection products at retail level.

Retail segment: Retail segment revenues plunged 25% to $1.2 billion in the quarter on a 41% decline in crop nutrient sales to $345 million due to a significant decline in crop nutrient prices. Crop nutrient volumes in the quarter remained flat. Gross profit from the crop nutrients business almost halved to $31 million. Crop protection sales were $768 million in the quarter, down 12% from the same period last year. The decline was driven by lower volumes for fungicides and lower pricing for glyphosate products.

Gross profit in the quarter was $169 million, down 12% from the previous year. Profit from the nutrient business was down significantly due to lower sales volumes from Legacy Agrium Retail and significantly lower margins resulting from the carry-over of high priced crop nutrient inventories, which were sold at lower prices. Sales for seed and services decreased 14% to $114 million.

Wholesale segment: Wholesale’s net sales were down 59% to $658 million in the quarter, driven by lower sales prices and volumes for nitrogen and phosphate products combined with significantly lower potash sales volumes. Nitrogen sales were down 48% to $260 million while potash sales declined 56% to $109 million. Phosphate sales were down 64% to $114 million.

Following lower sales, nitrogen profits shrank 61% to $80 million while potash profits declined 81% to $47 million. Phosphate profits of $1 million were negligible compared with $195 million in the year-ago quarter.

Both international and domestic demand were significantly lower than usual due to a combination of delayed contract settlements in China and India, credit issues in many other international markets and the current cautious approach to replenishing stocks of retailers and distributors in North America and globally.

Advanced Technologies segment: Sales in the Advanced Technologies segment were down 33% to $60 million year over year, driven by lower volumes and margins in turf and ornamental business due to lower household expenditures as a result of the slower economic growth. Cash provided by operating activities was $229 million in the quarter compared to $300 million in the prior year.

Compared to the end of the third quarter of 2008, net debt to net debt plus equity dropped 10% to 26% at the end of the quarter. Agrium sees a significant recovery in demand across all crop inputs starting early 2010, particularly for the retail and potash businesses. Corn prices are recovering and the growth for food products is set to remain strong.

Through all three operational business units – Retail, Wholesale, and Advanced Technologies – Agrium is well positioned to benefit from a recovery in the agriculture and crop input market. Agrium expects earnings per share of 14 cents to 44 cents in the fourth quarter of 2009. Meanwhile, Agrium repeated its commitment to acquire Deerfield, Illinois-based CF Industries (CF) and its willingness to increase its offer of $40 in cash plus one U.S. dollar-denominated Agrium share.

CF has steadfastly rejected Agrium’s takeover offer. Despite two upward revisions in the offer price, CF had turned down Agrium primarily on the grounds of substantial undervaluation. CF Industries has meanwhile made a hostile takeover bid for rival Terra Industries. Terra, which produces and markets nitrogen products, has repeatedly rebuffed CF’s proposal.

However, CF remains committed to acquire Terra. Agrium also remains committed and has extended the deadline several times. The company has stated that its cash reserves are sufficient and has committed financing to complete the deal. Should the acquisition go through, Agrium would become the world's fourth-largest fertilizer producer.
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DrStockPick.com Stock Report! 8/17/09, FO, PETD, HTZ, SXI, SPNG, RGR

Dr. Stock Pick — Mon, 17 Aug 2009 18:22:01 +0000

DrStockPick.com Stock Report! Monday August 17, 2009 ************************************************************** Acushnet Company, the golf business of Fortune Brands, Inc. (NYSE: FO), announced that on August 14, 2009, the United States Court of Appeals for the Federal Circuit granted the company’s request for a new trial and issued other favorable decisions in its patent dispute with [...]

Inventories Still Falling – Analyst Blog

Dirk Van Dijk — Thu, 13 Aug 2009 18:47:55 +0000

Total inventories across all levels of business fell for the 10th straight month in June. The 1.1% decline was bigger than the 0.9% decline expected by the consensus of economists, and follows a downwardly revised 1.2% drop (was down 1.0%) in May.

Inventories can be a big swing-factor in GDP growth, and the revision to May and the lower-than-expected number for June would seem to point to a downward adjustment to the second quarter GDP numbers when the next revision comes out.

Overall, lower inventories is a good thing, since it points to the need to replenish them in the future and in the process boost economic growth. June also saw a 0.9% rise in overall sales from May, which is a very welcome sign and a reversal of a very nasty trend that has lowered sales by 18.0% over the last year. The combination of rising sales and falling inventories lowered the inventory to sales ratio to 1.38.

As shown in the graph below (click here for a more legible version: http://www.census.gov/mtis/www/mtis_current.html), the inventory-to-sales ratio had been in a secular decline until this recession hit. A year ago the ratio was near its all time low at 1.26 -- then the credit crunch hit and the ratio spiked to 1.46 in December and January, and has since started to decline again. That level was the highest since April of 1996.

The ratio is important since if businesses see that inventories are too low, they will start to ramp up production to refill them. The decline in the ratio is encouraging, but we still have a ways to go.

All three levels -- manufacturers, retailers and wholesalers -- saw declines in the month. However at the manufacturing and wholesale levels the ratios remain significantly higher than a year ago.

From a cash flow perspective, lower inventories (in absolute terms, not relative to sales) are good since it frees up working capital. In this environment, companies can use all the working capital they can get. For many businesses, the ability to turn over their inventories is just as important to them as the gross margins they earn on each sale.

At the retail level, it depends greatly on the type of store you have. A grocery store like Kroger’s (KR) cannot sit on the same fresh raspberries for a year; rather, they depend on replenishing their stock often and sell at relatively low mark-ups.

At the other extreme, a jewelry store like Tiffany’s (TIF) will sit on its inventory for a long time, but get a big mark-up on each sale. The secular decline in the ratio had been driven by improved information technology that has allowed for companies to adopt just in time inventory systems.

Overall, the decline in the inventory-to-sales ratio is a welcome sign, but it is not yet cause for celebration. I’m not sure if the secular trend is still intact longer term (it had flattened out for about 2 years before spiking), but there is nothing to suggest that the new "normal" should be significantly higher than the levels of two years ago.

This implies that the inventory to sales ratio needs to come down more. That, in turn, suggests that production will not increase as fast as sales do -- if and when sales start to pick up significantly.

Read the full analyst report on "KR"
Read the full analyst report on "TIF"
Zacks Investment Research

HearAtLast to Develop 25 New Hearing Store Locations in the USA and Canada

Stuart T. Smith — Mon, 06 Jul 2009 14:05:11 +0000

MISSISSAUGA, ON — (Marketwire) — 07/02/09 — HearAtLast Holdings, Inc. (PINKSHEETS: HRAL), a leading provider of suitable affordable solutions to clients with hearing needs in the billion dollar hearing loss market, announced today it will be developing 25 new Hearing Store locations in various markets in the USA and Canada. These new locations will be [...]

BrandPartners Group, Inc. (BPTR.OB) Reports First Quarter Results

QualityStocks — Mon, 18 May 2009 13:57:47 +0000

BrandPartners Group, Inc. today reported its financial results for the quarter ended March 31, 2009. Revenues for the quarter totaled $11.5 million compared to $9.2 million during the same period a year earlier. Net Income also increased significantly, totaling $717,234, or $.02 per fully diluted share, versus net income of $546,446, or $.01 per fully [...]

PNI Digital Media Inc. (PNWIF.OB) Offers More than a Digital Ordering Platform, Daily Interactions Up to 33,000 and Climbing

QualityStocks — Wed, 03 Dec 2008 16:22:58 +0000

As technology advances and evolves, it is becoming apparent that it is starting to control the user instead of the user controlling it. The often talked about “Crackberry” may be a case in point. Developing a technology where the user can access it to make life more enjoyable and efficient, rather than addictive and ultimately [...]

Why Gold Will Soar As Fiat Currencies Crumble

Contrarian Profits — Wed, 03 Dec 2008 14:58:16 +0000

pThe short-term path of gold is still unclear says strongDavid Galland/strong. But its a good sign that demand for physical gold soars when prices tip towards $750 an ounce. And this threshold is likely to creep upwards as the US dollar loses its worth, and foreign governments convert currency reserves for the precious metal./p pThis from a href="http://www.moneymorning.com" class="alinks_links"Money Morning/a:/p blockquotepOf late, I have read a number of analysts, Jim Rogers even, who have expressed the view that gold could dip to the mid- to low $600 level./p pIt could happen, but I think not. Already, buyers of physical gold are finding anything near $700 to be cheap and are helping to build a floor under the monetary metal. On that topic, a friend sent#8230;/p/blockquote

Gold is a “Buy” at $750 or Less … But in the Low $600 Range, it Will be an Absolute Steal

Money Morning — Wed, 03 Dec 2008 09:30:47 +0000

By David Galland Editor, The Casey Report Of late, I have read a number of analysts, Jim Rogers even, who have expressed the view that gold could dip to the mid- to low $600 level. It... Money Morning is here to help investors profit handso...

Gold in the Low $600s?

Contrarian Profits — Thu, 20 Nov 2008 18:27:35 +0000

Of late, I have read a number of analysts, Jim Rogers even, who have expressed the view that gold could dip to the mid- to low $600 level. Could happen, but I think not. Already, buyers of physical gold are finding anything near $700 to be cheap and so are helping to build a floor under the monetary metal.

On that topic, a friend sent this item along last week…

(Gulf News Nov 12) Riyadh: There has been an unprecedented demand for gold in the Saudi market recently, with over 13 billion Saudi riyals (Dh12.75 billion) being spent on the yellow metal during the last two weeks.

Demand is expected to rise still higher as more investors turn to gold as…

Very Little Gold to be had at the retail level

Alex Stanczyk — Thu, 16 Oct 2008 19:06:48 +0000

There has been a great deal of articles lately on shortages and unavailability of gold at the retail level. My thoughts on this, are that in time it may become increasingly difficult to acquire physical gold at the retail level. This is a repeat of history. I have suspected for some time that this would happen, but [...]

M3 Money Supply Chart and Gold Shortage Update

Alex Stanczyk — Wed, 15 Oct 2008 11:59:36 +0000

M3 Money through Oct. 10th is sitting at approximately $14 Trillion, and 16% year over year rate of increase. I have said this before, but if you have not figured it out yet, if money supply is expanding at 16% that means your investments MUST grow at more than 16% or you are going backwards. On [...]

More proof of rising inflation …

Larry Edelson — Thu, 21 Aug 2008 18:37:14 +0000

Food prices to post biggest rise since 1990: USDA

WASHINGTON (Reuters) - U.S. consumers should brace for the biggest increase in food prices in nearly 20 years in 2008 and even more pain next year due to surging meat and produce prices, the Agriculture Department said on Wednesday.

Food prices are forecast to rise by 5 percent to 6 percent this year, making it the largest annual increase since 1990. Just last month, USDA forecast food prices would climb between 4.5 and 5.5 percent in 2008.

"It's a little bit of a surprise how strong some of the numbers were in July," USDA economist Ephraim Leibtag, who prepared the forecast, said in an interview.

"We've been waiting for some moderation, but especially with some of the meat prices and how much has come through relatively recently (at the retail level) leads me to believe the overall number may be a little bit higher for the year," he added.

Leibtag said he expected food prices to moderate, but the timing depends on what happens to volatile energy and food ingredient costs.

Prices are expected to rise by 4 percent to 5 percent in 2009, lead by red meat and poultry. The forecast, if correct, would be the third straight year where food prices have surged at least 4 percent.

In its latest food prices report, USDA said the increase for 2008 was due partly to higher costs for meat, poultry and fish, which make up about 12 percent of total food spending. Overall, costs for these items are forecast to rise 3 percent compared to 2.5 percent estimated last month.

Prices for fruits and vegetables, which account for more than 8 percent of food spending, will also rise 5.5 percent versus 5 percent predicted in July.

USDA also forecast increases this year of 9.5 percent for cereals and bakery products, a 14 percent surge for eggs and a 13.5 percent hike for fats and oils.

A broad range of commodities posted record highs this year, including corn and soybeans. Prices have since backed off as concerns over smaller crops due to a wet spring in the U.S. Midwest have largely dissipated.

In its first estimate of the fall harvest, USDA last week forecast a corn crop of 12.29 billion bushels, the second largest on record.

Despite the near-record crops, farm-gate prices for this year's corn, wheat and soybean crops, while lower than earlier forecasts, will still set records.

Dont Look, and Dont Tell..Paper Gold Prices have decoupled from Physical Gold Demand and Supply

Alex Stanczyk — Mon, 18 Aug 2008 19:06:15 +0000

Dont Look, and Dont Tell..Paper Gold Prices have decoupled from Physical Gold Demand and Supply I was having a chat with several colleagues of mine in the precious metals industry over the last few days, and a few things have become readily apparent. 1. The massive sell off in paper gold contracts has forced the paper price [...]