March 23, 2009
After a week of ups-and-downs, the markets concluded the week in the green despite continuous economic data revealing the unease of the nation. However, there were companies, throughout the trading sessions, that managed to post solid gains by the end of the week. Even with the major indices ending in the green, other companies could not rally with the markets.
In a week that had several disappointing reports for AFLAC Inc. (AFL), the stock still managed to post a solid week, gaining more than 26% in the stock’s market value. AFLAC, is a general business holding company that acts as a management company, overseeing the operations of its subsidiaries by providing management services and making capital available.
The company’s primary business is supplemental health and life insurance that is marketed and administered primarily through its subsidiary, American Family Life Assurance Company of Columbus. Recently, the company was downgraded by analysts at Friedman, Billings, and Ramsey from “outperform” to “market perform.” The reasoning behind the downgrade was in regards to widening spreads on sovereign debt and other company holdings, totaling more than $1.3B.
With the downgrade, the stock’s target price range was lowered to $20 per share. However, there were positives for the company as well. To show their shareholders that those in charge of the company were not taking excessive advantage of the company in this dire economic environment, the Chairman and CEO elected to forgo his 2008 bonus of $2.8M, while the president and CFO of the company took a 35% bonus cut as well.
Monday’s session brought much of the same results that the previous week did in trading. By the close of the markets, shares of AFL were up 18% on the day, adding $3.31, to end the day at $21.69 per share. Over the past year, shares of AFLAC have traded in a range between $10.83 and $68.81 per share.
Another company recording substantial gains throughout the past week was Gulfmark Offshore Inc. (GLF), which provides offshore marine services primarily to companies involved in offshore exploration and production of oil and natural gas. The company provides vessel transport drilling materials, supplies and personnel to offshore facilities, as well as the moving and positioning of drilling structures.
As the only pertinent information released about the company last week, Gulfmark announced the election of Brian Ford to serve on the company’s board of directors, serving on the Audit Committee.
Ford, who currently serves on the board of directors at Drexel University, is a graduate of Rutgers University and is a retired partner of Ernst & Young LLP. Ford was the co-author of Ernst & Young’s Business Plan Guide.
By the close of the trading week, shares of GLF were up more than 22% in total, on purely speculative trading. With no major news to speak of, Gulfmark’s stock jumped from just under $19 a share, to nearly $23 a share. The start of the new week saw the same as the previous week, as GLF shares added nearly 9% Monday, or $2.03, to end the session at $24.88 per share. Within the last 52-week, shares of GLF have traded between $15.79 and $70.98 per share.
One of the final companies that managed to increase their market share significantly over the past week was Ocwen Financial Corp. (OCN), which is a financial service holding company engaged in asset acquisition and resolution, residential finance, commercial finance, investment management and hotel operations. Ocwen Financial specializes primarily in the acquisition and resolution of non-performing or underperforming loans.
Durng the previous week, and in fact over the past two weeks, shares of OCN have been advancing higher on a torrent pace. After closing the session on March 10 at $8.37 per share, the stock has closed at yearly highs everyday since then. From that day, the stock has increased 35%, with the past week posting a gain of more than 21%.
At the end of the week, the company’s stock was upgraded to a “buy” rating by Zacks analysts from a “hold.” By the end of 2008, OCN had modified nearly 61,000 loans, in order to help prevent foreclosure. In the first two months of the year, the company had nearly 15,000 loans which they had modified with charges and upfront fees of $1,000 each.
Based on the company’s 4Q earnings report in 2008, the company increased their expected earnings per share to $0.85 for 2009, and increased their 2010 projections to $1.19 per share. By the close of Monday’s trading session, shares of OCN advanced once again, setting a new 52-week high at $11.81 per share, adding $0.51, or 4.5%.
brought to you by