Thursday, November 14, 2013

Hertz Global Holdings (NYSE: HTZ) This Beaten-Up Rental Giant Looks Ready for a Comeback

In this market, finding a stock with strong upside potential that's also come down well off of its 52-week high isn't as easy as it may seem. But thanks to what I call the performance protection trade, there are high-fliers that have pulled back. Stocks such as Tesla Motors (NASDAQ: TSLA) and Facebook (NASDAQ: FB) fit this description well, as does auto and equipment rental giant Hertz Global Holdings (NYSE: HTZ).

HTZ has rewarded shareholders with a 40% gain in 2013, easily besting the benchmark S&P 500 index's 24% year-to-date showing.

However, at the time of its 52-week high of $27.75, made in mid-July, the stock was up more than 70%. Shares sold off through the rest of the summer before retesting this high in September.

Then, in late September, HTZ suffered a huge one-day sell-off that drove it below both the 50-day and 200-day moving averages. HTZ currently trades near $22.80, about 17% off its recent highs and right about where it traded in mid-April.  (more)

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Yes, Oil Prices Are Being Manipulated — But Not By Who You Think

Ask most Americans and they'll tell you the oil markets are controlled by OPEC. But a recent lawsuit brought by four veteran floor traders alleges the global oil market is being manipulated from the waters off Scandinavia, not via the Middle East or Venezuela.

Specifically, ex-NYMEX board member Kevin McDonnell and three other floor traders allege BP, Shell, Statoil and the private trading firm Vitol are colluding to manipulate prices of Brent crude, the world's benchmark energy price.

At issue is that a relatively small amount of oil from the North Sea -- between 1.2 million and 1.4 million barrels per day -- is being used as the benchmark for the roughly 90 million barrels that are priced daily in financial markets, as Dan Dicker, a former oil trader and author of Oil's Endless Bid, tells me and Lauren Lyster in the accompanying video.
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This Is Becoming “An Agent Of Financial Recklessness”

from King World News
On the heels of yesterday’s new all-time high closing on the Dow, and gold and silver continuing to slide lower, today KWN thought it would be interesting to share an absolutely brilliant piece from 50-year veteran Art Cashin. Cashin, who is Director of Floor Operations at UBS ($650 billion under management), warns about what is becoming “an agent of financial recklessness.” This is an important piece for KWN readers around the world.
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E I Du Pont De Nemours And Co (NYSE: DD)

E. I. du Pont de Nemours and Company operates as a science and technology based company worldwide. Its Agriculture segment provides corn hybrid, soybean, canola, sunflower, sorghum, inoculants, wheat, and rice seed products under the Pioneer brand; and herbicides, fungicides, and insecticides. The company's Electronics and Communications segment supplies materials and systems, including photopolymers and electronic materials for photovoltaic products, consumer electronics, displays, and advanced printing. The Industrial Biosciences segment develops and manufactures a portfolio of enzymes. The Nutrition and Health segment offers cultures, emulsifiers, gums, natural sweeteners, and soy-based food ingredients. The Performance Chemicals segment offers industrial and specialty chemical products for markets, including plastics and coatings, textiles, mining, pulp and paper, water treatment, and healthcare; titanium dioxide products. The Performance Materials segment provides thermoplastic and thermoset engineering polymers, elastomers, films, parts, and systems and solutions for the automotive original equipment manufacturers and associated after-market industries. The Safety and Protection segment primarily offers nonwovens, aramids, and solid surfaces for the construction, transportation, communications, industrial chemicals, oil and gas, electric utilities, automotive, manufacturing, defense, homeland security, and safety consulting industries. The Pharmaceuticals segment represents its interest in the collaboration relating to Cozaar/Hyzaar antihypertensive drugs.
To review E.I.'s stock, please take a look at the 1-year chart of DD (E. I. du Pont de Nemours and Company) below with my added notations:
1-year chart of DD (E. I. du Pont de Nemours and Company) DD had been trading in a sideways range for the last 4 months. During that period of time the stock had also been bouncing within a common chart pattern known as a rectangle. Rectangle patterns form when a stock bounces between a horizontal support and resistance. A minimum of (2) successful tests of the support and (2) successful tests of the resistance will give you the pattern. DD's rectangle pattern had formed a $60 resistance (blue) and a $56 support (green). Now that the stock has broken its rectangle resistance higher prices should follow.

The Tale of the Tape: DD has broken through the resistance of its rectangle pattern. The possible long position on the stock would be on a pullback to $60. The ideal short opportunity would be on a break back below $60.
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Axcelis Technologies (NASDAQ: ACLS) This Industry's Smallest Player Has the Biggest Potential Upside

When chip equipment maker Applied Materials (NASDAQ: AMAT) surpassed $10 billion in annual revenue for the first time in fiscal 2011, its competitors could only sigh. The company's industry leadership was never in doubt, but a series of acquisitions gave it such a broad suite of offerings that rivals wondered if they could ever take market share again.

AMAT's massive market presence eventually led its two biggest rivals, Lam Research (NASDAQ: LRCX) and Novellus Systems to join forces in 2011, but even that combined entity has yet to crack the $5 billion annual revenue barrier. KLA-Tencor (NASDAQ: KLAC) is also in AMAT's rearview mirror, with only $3 billion in annual sales. And a handful of smaller companies bring up the rear, none of which have even $1 billion in annual revenue. (Note: Only U.S. companies have been considered here.)

Lost in the crowd is little-known Axcelis Technologies (NASDAQ: ACLS), which had $400 million to $500 million in annual sales a decade ago, but has slumped badly in recent years, with sales falling to just $200 million in 2012. (more)

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McAlvany Weekly Commentary

Russell Napier: Strangled by the “Seen Hand”

About this week’s show:
-Emerging markets: trigger for next crises
-Government favoritism: rationing of credit
-Gold benefits from deflation and inflation
About the guest: Russell Napier is a consultant with CLSA Asia-Pacific Markets writing on issues affecting global equity markets. After studying law, he began his investment career sixteen years ago at Baillie Gifford in Edinburgh managing funds in the Japanese then the US and finally the Asian markets. Moving to Foreign & Colonial Emerging Markets in London he was responsible for managing Asian portfolios. In May 1995, Russell relocated to Hong Kong to become Asian equity strategist for CLSA, a leading Asian equity brokerage.

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