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Morning Coffee Pre-Market Wall Street News

65 views  2013-07-22 07:51   Tagsbackground  appointed  manager  outline  lawyer 

Leaders Defend Detroit Bankruptcy

Michigan Gov. Rick Snyder (R) and Kevyn Orr, the emergency manager and bankruptcy lawyer that was appointed to run the city, both put the city’s bankruptcy blame squarely on the city. The city has been run by Democrats for decades.  At its height Detroit had over 1.8 million citizens, now the city has less than half that many citizens leaving abandoned burned out homes and a $19 billion debt in its wake. The city had once even been considered as a finalist for the Olympics.

The Republican Governor stood by his decision over the weekend on Face the Nation saying that “It’s not about just more money, it’s about accountable government.” He went on to talk about the mismanagement and corruption within the local government. Currently former Detroit Major Kwame Kilpatrick is serving a jail sentence for racketeering, wire fraud, Mail fraud, and obstruction of justice.

Some Wall Street analysts and investors are watching very closely since there are several other major U.S. cities with similar financial problems including : Chicago which has an unfunded pension liability reported to be at least $19 billion and Los Angeles with a liability estimate to be as much as $30 billion.

Upgrades:

Alcatel-Lucent (ALU): Raymond James raised their rating from Outperform to Strong Buy and placed a target price of $3.50 on the company.

Cognizant Tech (CTSH): Goldman Sachs raised their rating from Neutral to Buy and placed a target price of $90.00 on the company.

Downgrades:

Autoliv (ALV): Buckingham lowered their rating from Buy to Neutral and lowered their target price from $68.00 to $63.00. Pre-market: 80.97 -1.16 (-1.41%)

Crocs (CROX): Wedbush lowered their rating from Outperform to Neutral and maintained their target price of $18.00.

Honeywell (HON): Nomura lowered their rating from Buy to Neutral and raised their target price to $88.00.

H&R Block (HRB): BTIG lowered their rating from Buy to Neutral.

Nokia (NOK): Oppenheimer lowered their rating from Perform to Underperform.

TD Ameritrade (AMTD): BMO Capital lowered their rating from Outperform to Market Perform and placed a target price of $26.00 on the company.

Towers Watson (TW): Deutsche Bank lowered their rating from Buy to Hold and raised their target price from $80.00 to $93.00.

VF Corp (VFC): Credit Suisse lowered their rating from Outperform to Neutral and lowered their target price from $208.00 to $188.00.

Coverage Initiated:

Earning Reports:

Federal-Mogul (FDML): Reported EPS of $0.57 beating estimates by +$0.18. Pre-market: 11.28 +0.60 (5.62%)

Gannett (GCI): Reported EPS of $0.58 missing estimates by $0.01. Pre-market: 25.11 -1.25 (-4.74%)

Halliburton (HAL): Reported EPS of $0.73 beating estimates by +$0.01. Pre-market: 46.10 +0.27 (0.59%)

Hasbro (HAS): Reported EPS of $0.29 missing estimates by $0.05. Pre-market: 44.60 -0.78 (-1.72%)

Kimberly-Clark (KMB): Reported EPS of $1.41 beating estimates by +$0.02. Pre-market: 98.05 -1.44 (-1.45%)

McDonald's (MCD): Reported EPS of $1.38 missing estimates by $0.02. Pre-market: 97.77 -2.50 (-2.49%)

Markets: 
Futures at 8:30: Dow +0.05%. S&P +0.05%. Nasdaq +0.17%. Crude +0.30% to $108.37. Gold +2.02% to $1319.02.

Europe: London -0.24%. Paris +0.15%. Frankfurt -0.09%. 

Asia: Japan +0.47% to 14658. Hong Kong +0.25% to 21417. China +0.61% to 2005. India +0.05% to 20,159. 

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