Bear Stearns (Loss), Nike (Beats), NetSuite (Monster) IPO
Bear Stearns reported its first quarterly loss($854 million, or $6.90 a share) in its history. Write-downs of $1.9 billion on lower value of mortgage-related securities. Up fractionally.
Nike beat, up 3 percent pre- open, and expects low double digit revenue in the second half of fiscal 2008.
FedEx beat estimates but talked about high fuel prices and weak U.S. economic growth, international growth still strong. Guidance for the current quarter (their third quarter) appears a bit light.
Bond insurer MBIA down from $27 to $22 this morning. Morgan Stanley, in a note this morning, said "MBIA published an updated list of its CDO exposures. It disclosed that it has a massive $8.1 billion of exposure to CDO-squared transactions (where the underlying collateral is more than 75% CDOs and the remainder is mostly RMBS). Of the total, $5.1 billion was written in 2006 and 2007. We are shocked that management withheld this information for as long as it did."
NetSuite has turned into one of the monster IPOs of the year, at least in the pricing. The company, which provides business management software, priced 6.2 million shares at $26 apiece. This is TWICE the original price of $13 to $16, which was boosted to $16 to $19 a couple days ago, then $19 to $22 yesterday.
This is Larry Ellison's baby--he and his family owns about 74 percent of the company, and the association with him may be a major factor. It still loses money. Bear in mind this is a Dutch Auction, so the price was not set by underwriters estimating demand and then setting a price; it was set in an actual auction. What, if any, initial pop there will be here due to the auction is not clear.
Finally, with the S&P 500 up a measly 2 percent this year, Ned Davis notes that we are precariously close to breaking a long record: the third year of the 4-Year presidential cycle has been positive every year since 1943.
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