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(Best) DVA, MICC, GOLD (Worst) RIMM, GXP, HS from Better Trades
February 11, 2009
Following yesterday’s massive sell-off in the markets, with all three major indices losing more than 4% by the close, today’s trading session was relatively calm in comparison. As investors tentatively entered back into the fray, in search of bargains, the markets were posting modest gains heading into the afternoon session.
A handful of stock were posting solid gains, and some were not, throughout the early part of the session, with results based on quarterly earnings released before the markets opened Wednesday and after the close on Tuesday.
Top 3 Stocks
DaVita Inc. (DVA)
Included in that group was DaVita Inc. (DVA), which is one of the largest providers of high-quality dialysis and related services for patients suffering from chronic kidney failure. Shares of DVA surged in today’s trading following the release of the company’s 4th quarter earnings report.
Posting a profit of $98.4M, or $0.94 per share, DaVita managed to increase their quarterly profits by nearly 15% from last year’s earnings of $85.7M, or $0.79 per share. Revenues also advanced during the period, up from $1.35B to $1.46B, an increase of more than 8%. Analysts were looking for earnings of $0.90 per share on $1.47B in sales.
Operating nearly 1,500 outpatient dialysis centers, the company reaffirmed their guidance for yearly operating income between $820M and $880M. On that news, shares of DVA jumped more than 10% in afternoon trading, adding $4.98 to trade at $52.41 per share. In the last year, shares of DVA have ranged between $40.96 and $60.20 per share.
Millicom International Cellular SA (MICC)
In a mixed report, Millicom International Cellular SA (MICC), a leading international operator of cellular telephony services, primarily in emerging markets where the basic telephone service is often inadequate and where economic development and change are creating new demand for communication services, also announced earnings this morning, which declined year-over-year, but still managed to come in ahead of expectations.
For the company’s 4Q, profits plummeted from $112.7M or $1.08 per share last year to this year’s earnings of $66.2M, or $0.61 per share, a decrease in net income of more than 41%. However, the company did manage to post higher revenues year-over-year, from $766.2M to $906.7M, an increase of more than 18% as the company added 1.6 million new subscribers.
Heading into late afternoon trading, shares of MICC were up more than 10%, adding $4.30 to trade at $45.45 per share. Over the past year, shares of MICC have traded in a range between $24.75 and $122.97 per share.
Randgold Resources Ltd. (GOLD)
Another company benefiting from today’s uptrend in the markets was Randgold Resources Ltd. (GOLD), which operates as an International gold mining and exploration business, saw their shares surge in trading today, as the stock was upgraded from “neutral” to ‘overweight” by HSBC Securities analysts.
The company also revealed information today pertaining to their expected mining production for 2009, which will include increases at two of their more productive mines, Morila and Loulo. The Morila mine is expected to produce some 330,000 ounces of gold, while the Loulo mine is projected to post a 100,000-ounce increase to total 360,000 ounces.
With expected increases in production and decreases in the cost of mining in the coming year, Randgold’s shares gained more than 10% during today’s trading session. By late afternoon, shares of GOLD were up $4.50 to trade at $48.56 per share with more than one million shares traded.
Worst 3 Stocks
Research in Motion Ltd. (RIMM)
Not faring as well today, there were other company’s stocks that did not benefit from today’s upward market trend. Consisting mainly of one particular company, Research in Motion Ltd. (RIMM) saw its stock decline by double digits on a percentage basis heading into the close.
RIMM, a world leader in the mobile communications market with a history of developing breakthrough wireless solutions, provides products, services and embedded technologies that are used by thousands of organizations around the world, including the BlackBerry wireless platform.
As a result of an announcement earlier this morning, shares of RIMM were battered in today’s session as the company warned investors of lower profits for the upcoming 4th quarter. Forecasting pending results, RIMM advised investors that final numbers will more than likely come in at the lower end of the company’s projections released in December, ranging between $0.83 and $0.91 per share.
Analysts are anticipating that the BlackBerry maker will post quarterly results of $0.85 per share on $3.41B in sales. RIMM is forecasting overall revenues between $3.3B and $3.5B. Nearing the sound of the closing bell, shares of RIMM were down $8.52, or 15%, to trade at $48.51 per share.
Great Plains Energy Inc. (GXP)
Following yesterday’s release of quarterly data for Great Plains Energy Inc. (GXP), after the markets closed, the resulting news pushed shares of GXP down more than 20% for much of the day.
Engaged in the generation, transmission, distribution and sale of electricity to customers located in all or portions of Western Missouri and Eastern Kansas, GXP posted a decline in 4Q profits last night of $6.6M, or $0.06 per share, down more than 86% from last year’s earnings of $47.7M, or $0.56 per share.
Revenues for the quarter were surprisingly higher, up more than 47%, from $301.9M to $443.9M. On top of diminished earnings, the company also reduced their guidance for 2009. Previously stated, GXP expected to post yearly earnings between $1.30 and $1.60 per share. However, with the current economic state, GXP revised that range downwards to $1.10 and $1.40 per share.
Shares of GXP were on a steady downfall after the opening bell, and by late afternoon, the stock has lost $4.06, or 20.8%, to trade at $15.49 per share.
HealthSpring Inc. (HS)
Not to be left out, HealthSpring Inc. (HS), despite a positive earnings release after the markets were closed Tuesday evening, saw their shares dip more than 14% heading into the conclusion of today’s session.
In their quarterly report, HS posted an 8% increase in profits for the 4Q, climbing from $26.2M, or $0.46 per share to $28.3M, or $0.51 per share. Revenues also managed to increase during the recent period, coming in at $540M, up more than 15% from last year’s total of 468M.
Even with the positive report, the company revised their yearly projections downward, and now looks to post earnings between $2.00 and $2.20 per share, after posting yearly earnings of $2.12 per share in 2008. Analysts are expecting HS to post annual earnings of $2.31 per share for 2009.
With the company’s revisions, shares of HS were rattled in trading today, falling $2.17, or 11.6%, to trade at $16.57 per share. HealthSpring’s stock has traded between $12.18 and $22.63 per share over the past 52 weeks.
2009 Better Trades Article
brought to you by
BRIAN MULLIN
