| From: ChanceIs | 1/23/2007 11:20:53 PM | | | | | | DuPont Sees '07 Buffeted By Housing, Auto Slowing
DOW JONES NEWSWIRES
By Laura Mandaro
SAN FRANCISCO (Dow Jones) -- A downturn in the U.S. housing and automotive markets has created stiff headwinds for chemicals bellwether E. I. du Pont de Nemours & Co., which reported Tuesday a sharp increase in fourth-quarter net profit but left Wall Street disappointed with its outlook.
"We're going into a very uncertain year, weighing all the ups and downs in the market environment," said CEO Charles Holliday in a conference call with reporters.
Results from Wilmington, Del.-based DuPont (DD) , which makes plastics ingredients like ethylene copolymers as well as specialty materials like laminate flooring and Teflon pan coatings, can act as an early indicator of the economy's direction because its products end up in so many finished goods.
On Tuesday, the country's second-largest chemicals maker threw some cold water on growing optimism that the housing market has started to rebound.
Headwinds from U.S. housing and automotive markets "turned out to be stronger than expected" during the fourth quarter, as customers reduced their inventory levels to adjust to a decline in housing starts, Chief Financial Officer Jeffrey Keefer told investors in a separate call.
The company forecast drags from lower activity in U.S. housing and automotive production continuing this year, as new residential housing demand falls in the first half from the year-ago period and sluggish auto output cuts into first-quarter earnings.
On the flip side, DuPont said it expects new products and overseas sales to drive 2007 growth higher -- much as they did in the fourth quarter, when double-digit sales growth in China and Eastern Europe offset a 3% drop in U.S. sales.
Fourth-quarter earnings, sales
The company said net income in the three months ended Dec. 31 increased more than fivefold to $871 million, or 94 cents a share, up from $154 million, or 16 cents, earned in the year-earlier period.
Earnings in the most recent quarter got a boost from one-time net gains of 49 cents a share, most of which were previously disclosed.
Excluding special items in both quarters, profits rose over three times to 45 cents a share from the hurricane-affected fourth quarter of 2005, matching the average of analyst estimates as compiled by Thomson First Call.
Net sales in the latest quarter climbed 8% to $6.28 billion, just shy of analysts' views of $6.3 billion.
The company's outlook of $3.15 a share in 2007 fell short of the $3.21-a-share average forecast by Wall Street.
"Given relief in energy costs since August, and the substantial decline in crude-oil prices year-to-date, management's guidance appears conservative," said Banc of America Securities analyst Kevin McCarthy in a note.
Shares of the Dow Jones Industrial Average component lost as much as 3.5% before closing 0.9% lower at $49.67. They had set a 52-week high of $51 on Jan. 17.
In December, DuPont said it would restructure its agricultural and nutrition unit in order to invest more in the fast-growing market for specialized seeds. It said the reorganization would cut 1,500 jobs worldwide and trigger $200 million in fourth-quarter restructuring charges.
In the fourth quarter, it took a $194 million charge from the agricultural business reorganization, offset by gains from hurricane and insurance recoveries.
Overall sales in the fourth quarter were boosted by higher crop-protection and seed sales and demand for its packaging materials.
Raw material costs climbed 3% from the year-earlier period, a slower pace than in prior quarters. The company says it expects raw material costs this year to be flat with 2006.
The drop in domestic sales resulted in a lower-than-expected tax rate in the United States, which DuPont said is one of its more highly taxed jurisdictions.
The lower tax rate boosted earnings in the fourth quarter by 2 cents a share. It expects a base tax rate of about 27% for 2007, up from 21.5% last year.
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| From: saveslivesbyday | 1/24/2007 12:08:34 AM | | | | | | Best example of "engineered earnings" yet - CTX beats estimate for Current QTR
Last Tuesday's news: "Centex said the writedowns will send it to a steep loss: $2 per share from continuing operations. Analysts polled by Thomson Financial are looking for a loss of 70 cents per share on revenue of $3.09 billion..."
Today's news: CTX said for the quarter ended Dec. 31 it saw a loss of $235.4 million from continuing operations, or $1.96 a share .. total revenue was $3.28 billion .... Analysts surveyed by Thomson First Call had been forecasting, on average, a quarterly loss of $2 a share on revenue of $3.12 billion" (since this past weekend, that is)
WOW - They went from profit of .81 1 week ago, to loss of 2.00 a few days ago, and can you believe it, how incredible, they beat the analysts' estimates by .04 per share! Wow, those Thomson analysts' sound like they're right on the ball!
From Yahoo:
EPS Trends Current Qtr
Current Est -2.00
7 Days Ago 0.81
30 Days Ago 0.82
60 Days Ago 0.83
90 Days Ago 1.01 |
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| To: SouthFloridaGuy who wrote (70598) | 1/24/2007 1:06:41 AM | | From: mishedlo | | | | Uhhh trust me, I don't need to go onto Google to do research on copper.
The why are you wasting my time asking me why its called Dr. Copper?
Mish |
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| To: saveslivesbyday who wrote (70620) | 1/24/2007 6:13:56 AM | | From: saveslivesbyday | | | | Anyone good with math? What is PE for CTX now?
With earnings of $0.25 in 2007 and share price of $54.10?
And that $0.25 is their estimate today ....
Can somebody convince me why this stock should be valued as a "growth stock," based on some hypothetical expectation that there will be a turnaround in the industry and markedly improved earnings in the next 2-3 years?
I don't have a position right now, and I'm honestly interested if anyone can rationalize or justify the current stock price.
I'm not sure how long these stocks can trade in thin air, last year it took until a general market selloff occurred for the stocks to correct.
Saves |
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| From: Paul Kern | 1/24/2007 7:03:17 AM | | | | | | *DJ US MBA Market Index Falls 8.4% To 611.3 From 667.2
*DJ US MBA Purchase Index Falls 8.4% To 402.7 From 439.7
*DJ US MBA Refinancing Index Falls 9.6% To 1848.8 From 2045.8
DJ US MBA Mortgage Survey Snapshot
WASHINGTON (Dow Jones)--Following is data from the Mortgage Bankers Association of America's weekly mortgage application survey, released Wednesday.
Seasonally Unadjusted Seasonally Adjusted
Week : Market Purchase Refi Market Purchase Refi
Ending : Index Index Index Index Index Index
01/19/07 567.4 347.3 1848.8 611.3 402.7 1848.8
01/12/07 601.8 353.6 2045.8 667.2 439.7 2045.8
01/05/07 466.8 282.6 1539.0 671.1 472.8 1923.8
12/29/06 350.5 213.4 1148.3 575.6 406.9 1640.4
12/22/06 482.6 289.8 1604.6 555.8 390.2 1604.6
12/15/06 567.9 327.3 1968.8 647.6 436.5 1968.8
12/08/06 642.4 356.8 2304.4 721.2 463.8 2304.4
12/01/06 582.8 341.1 1989.7 647.6 426.6 1989.7
11/24/06 383.3 238.8 1224.7 599.0 406.7 1749.6
11/17/06 584.0 351.9 1935.3 623.6 401.4 1935.3
11/10/06 555.8 338.6 1820.0 647.5 412.9 2022.2
11/03/06 601.5 378.8 1897.9 620.9 402.2 1897.9
10/27/06 557.0 359.1 1709.2 570.8 375.6 1709.2
10/20/06 575.9 367.2 1790.4 588.6 382.4 1790.4
DJ US MBA Mortgage Survey Table Of Seasonally Adjusted Data
Seasonally Adjusted data for week ending 1/19/07
Composite Index Current Prev Week % Change 4 Wks Ago Year Ago
Market 611.3 667.2 -8.4 555.8 660.5
Purchase 402.7 439.7 -8.4 390.2 473.7
Refi 1848.8 2045.8 -9.6 1604.6 1773.9
Fixed-Rate 511.1 551.2 -7.3 448.1 488.5
ARM 2715.8 3102.2 -12.5 2815.9 4268.2
Conventional Market Current Prev Week % Change 4 Wks Ago Year Ago
Total 910.9 993.2 -8.3 826.1 982.6
Purchase 629.9 685.1 -8.1 607.2 743.9
Refi 2078.1 2305.2 -9.9 1808.9 1980.9
Fixed-Rate 758.1 815.7 -7.1 661.8 716.3
ARM 4044.6 4633.9 -12.7 4194.8 6444.7
Government Market Current Prev Week % Change 4 Wks Ago Year Ago
Total 111.9 123.8 -9.6 105.4 123.4
Purchase 78.0 89.0 -12.4 80.1 87.5
Refi 638.1 676.4 -5.7 525.8 682.1
Fixed-Rate 99.7 110.9 -10.1 92.6 109.0
ARM 378.5 405.3 -6.6 386.9 438.7
DJ US MBA Mortgage Survey Table Of Unadjusted Data
Unadjusted data for week ending 1/19/07
Composite Index Current Prev Week % Change 4 Wks Ago Year Ago
Market 567.4 601.8 -5.7 482.6 546.6
Purchase 347.3 353.6 -1.8 289.8 366.3
Refi 1848.8 2045.8 -9.6 1604.6 1596.5
Fixed-Rate 474.4 497.1 -4.6 389.1 404.2
ARM 2520.7 2797.8 -9.9 2444.8 3532.3
Conventional Market Current Prev Week % Change 4 Wks Ago Year Ago
Total 846.3 897.4 -5.7 719.1 813.7
Purchase 543.3 551.1 -1.4 451.0 575.3
Refi 2078.1 2305.2 -9.9 1808.9 1782.8
Fixed-Rate 704.4 737.0 -4.4 576.1 593.2
ARM 3757.9 4186.9 -10.2 3651.5 5337.0
Government Market Current Prev Week % Change 4 Wks Ago Year Ago
Total 102.4 108.8 -5.9 88.2 101.3
Purchase 67.2 71.6 -6.1 59.5 67.7
Refi 638.1 676.4 -5.7 525.8 613.9
Fixed-Rate 91.2 97.5 -6.5 77.5 89.5
ARM 346.4 356.3 -2.8 323.8 360.0
DJ US MBA Mortgage Survey Table Of Comparisons
Percent Change In Percent Change
No. Of Applications In Dollar Value Avg
Week Ago 4Wks Ago Yr Ago Week Ago 4Wks Ago Yr Ago Loan
($000)
Total -5.7 17.6 3.8 -6.9 16.6 8.8 243.1
Purchase -1.8 19.8 -5.2 -0.7 22.8 -2.8 234.9
Refi -9.6 15.2 15.8 -12.5 10.9 23.8 252.1
Fixed-Rate -4.6 21.9 17.4 -3.8 25.7 31.0 210.1
ARM -9.9 3.1 -28.6 -13.2 0.5 -21.0 373.2
Conventional -5.7 17.7 4.0 -7.0 16.6 8.8 250.5
Purchase -1.4 20.5 -5.6 -0.5 23.1 -3.4 242.3
Refi -9.8 14.9 16.6 -12.6 10.7 24.3 259.3
Fixed-Rate -4.4 22.3 18.7 -3.7 26.2 32.4 216.6
ARM -10.2 2.9 -29.6 -13.5 -0.1 -21.8 380.9
Government -5.9 16.0 1.1 -5.0 17.7 9.5 141.1
Purchase -6.0 13.0 -0.6 -3.9 16.7 10.9 150.3
Refi -5.7 21.3 3.9 -7.2 19.8 6.9 126.3
Fixed-Rate -6.4 17.8 2.0 -5.4 15.3 7.0 126.4
ARM -2.8 7.0 -3.8 -3.9 26.2 18.2 225.7
DJ US MBA Mortgage Survey Table Of Current Interest Rates
Change in Contract Rate (bps)
Effective Total Contract 1 Week 4 Weeks 1 Year
Rate Points Rate Ago Ago Ago
30-Year Fixed 6.41 0.97 6.22 4 10 18
15-Year Fixed 6.19 1.02 5.93 1 10 27
7-Year Balloon 6.48 1.22 6.17 8 -2 35
5-Year Balloon 7.15 1.29 6.83 0 4 71
ARM, 1-Yr Tsy 6.12 0.81 5.91 7 4 48
FHA 203 (b) 6.49 1.00 6.32 5 11 70
All rates except FHA 203(b) are for 80% loan-to-value mortgage.
(END) Dow Jones Newswires
01-24-07 0700ET
Copyright (c) 2007 Dow Jones & Company, Inc. |
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| To: Paul Kern who wrote (70623) | 1/24/2007 8:02:38 AM | | From: Think4Yourself | | | | | That doesn't bode well for spring sellers counting on a recovery. No increase of buyers waiting in the wings. Looks like the improving trend was just a new year's surge that has petered out. |
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| To: Think4Yourself who wrote (70607) | 1/24/2007 8:08:17 AM | | From: ChanceIs | | | | >>>That article said "Loss from continuing operations was $1.96 per diluted share".<<<
I think you are referring to the snip below:
_________________________________________________________
Home building reported an operating loss of $292 million for the quarter, after the write off of $138 million of option deposits and land pre-acquisition costs and $297 million of land valuation adjustments, including $97 million from joint ventures. Housing operating earnings (housing revenues less housing cost of sales and SG&A) were $76 million, driven lower by a 12% decrease in closings to 8,360 homes and increased sales incentives. The margin from housing operations was 3.0% in this year's third quarter. The home building operating margin for the quarter, as reported, was a negative 11.3%, primarily a result of the land valuation adjustments.
_______________________________________________________
The CEO is including $138 and $97 million of option and land impairment in the operational data. In my mind these items hardly belong in the operating data. Rather they would gain/loss from investing activities over in the "Cash Flow" page of the accounting presentation. He then goes on to say that the operating earnings were $76 million. Its really a matter of symantics, and I think this guy is employing very uncommon usage.
Again I puzzle. These companies all grew their profits and their P/Es. They are taking impairments/writeoffs/writedowns. The Street cheers because they are getting the bad news out.
I wonder how they expect to grow in the future or get back to where they were. Those option losses are just that - losses to equity. How will they pay for future options/land acquisitions. Not with the premiums they previously paid to the current landowners. Not with the money they paid to buy back shares - the former shareholders have that now. Of course they could always issue new shares. How about with debt??? Some took on debt to buy the shares. Against what will the debt be issued??? Not the elapsed option equity, for sure.
Of course all this depends upon the financial structure of each corporation. I think that the general point holds. There is also the notion that both fixed and variable costs can be scaled back. After a while, the core fixed costs can't be shrunk any lower - you know - the CEO's salary. Are we near that point??? I have no idea.
I think a lot of analysts - Cramer - are looking at the chart, and saying these companies are all worth what they were worth back in July 2005. Now that we have had our correction, we will go right back to those levels. |
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| To: Think4Yourself who wrote (70624) | 1/24/2007 8:42:48 AM | | From: Paul Kern | | | | That doesn't bode well for spring sellers counting on a recovery. No increase of buyers waiting in the wings. Looks like the improving trend was just a new year's surge that has petered out.
Perhaps, CR, could post an updated chart for the purchase index with the four and 12 week MAs to smooth out some of herky-jerky action? |
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| To: bentway who wrote (70612) | 1/24/2007 9:01:50 AM | | From: damainman | | | | | That is as pessimistic article as I have read from Juback, usually he is a pretty middle of the road guy. Next thing you know he'll be spewing conspiracy theories. |
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