March 29, 2024

Daily Wrap

DJIA +61.66 (+0.46%) to 13,390.51; S&P 500 +3.87 (+0.27%) to 1,461.02; NASDAQ +14.00 (+0.45%) to 3,105.81

The highs for today were set in very early trading and then the rest of the day was spent pulling back although never going into negative territory.  I would define today as orderly and we do have Unemployment data tomorrow so I am not surprised to see a quiet day ahead.

Apollo Group Inc.’s (APOL) was in the new today and in negative fashion.  After the close yesterday, APOL reported Net Income that were 11% lower than the previous year but still beat on the top and bottom line.  The problem was APOL again lowered estimates for the coming year as well as declining enrollment and a potential accreditation issue.  In additional, APOL saw a few downgrades between last night and this morning.  A reminder, you can see that and other analyst notes at the  Upgrades/Downgrades section.  APOL is currently turning a profit and it seems as though they purchased shares back over the past year and will likely continue on that trend.  APOL is showing over $11 per share in cash and while I would consider the name risky, especially if they lose the accreditation, there could definitely be an opportunity brewing.  I do like the recent changes I saw with the company looking to partner with companies providing targeted training and that could provide added opportunity that rights the ship.

Another stock with analyst comments today is B&G Foods Inc. (BGS) which was upgraded by Piper Jaffray with a $34 price target.  BGS closed up over 6.5% and is approaching the recent closing high of $31.97 and intraday high of $32.84.  Even at current levels, BGS has a near 4% (3.7 as of the close) dividend yield but otherwise I am personally slightly concerned of the BGS valuation.  For those interested in dividends, it is tempting, but I often am not with a name beyond receiving one or two and predominantly look for capital gains.  Also Piper’s note stated their analysis also relies on BGS doing an accretive acquisition in the coming quarters.  I don’t know about that.  I would likely keep BGS on the radar but would also be on the sidelines until I saw the companies strategy (or acquisition) and then reviewed what the new entity will look like and start the valuation process.

I was somewhat surprised by this one and DigitalGlobe Inc. (DGI) repoted receiving antitrust clearance from the U.S. Department of Justice for its deal to acquire (more a combination than acquisition it seems) of GeoEye Inc. (GEOY).  Not surprised by the clearance by DoJ but that DGI and GEOY were up over 6 and 8% respectively.  I didn’t realize there was that much pent up action in the names.

Last name for the evening is Dish Network Corp. (DISH).  Well it is actually the unsolicited bid by DISH to acquire Clearwire Corp. (CLWR), offering $3.30 a share or a roughly 11% premium to Sprint’s (S) offer.  Originally CLWR traded higher when S first made their offer but after accepting S’s bid CLWR has traded just below the S offer which makes me believe that the market was not not broadly expecting another bid.  Shots are now fired and we will have to see how S and CLWR respond.  Remember S currently owns 51% of CLWR to add a little more drama.

Tomorrow we have Unemployment data and always you can visit the Event’s Calendar for the release of economic data, scheduled meetings and other news that could move the market.

According to Briefing.com, the following noteworthy companies are scheduled to report earnings before tomorrow’s open: MSM, SVU

I thought we would see lower prices in the short term.  Not dramatically so but something down to the 1440-1444 level.  SO far that hasn’t come about but there can be times when you work more sideways than retrace and maybe that is what we have here.  I still like the potential MACD recycle on the 1 hour SPY chart and therefore would still consider any pullback an opportunity.

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