BloggingStocks

World food shortage and the ethanol bubble

Kevin Kersten — 2008-07-07T13:27:00+00:00

Filed under: Archer-Daniels-Midland (ADM), Mexico, Deere and Co (DE), Politics, Commodities, Agriculture, Green Stocks, Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT)

We had the internet bubble and the real estate bubble and now, there is the ethanol bubble. Recently, I ran some numbers on ethanol and to my amazement realized that it is - too use a catch phrase from the environmental world -- not sustainable. Turning food into fuel is just plain silly; and when oil prices come down the ethanol bubble could pop big.

I ran did a little research and found some numbers:

47% of the Mexician' diet is corn
it takes 2.4 pounds of corn a day to feed a hungry person
it takes 22 pounds of corn to make one gallon of ethanol
there are 42 gallons of refined gas in one barrel of oil

Now, a little basic math can be very enlightening. To replace one barrel of oil, it takes 42 gallons of ethanol or (42x22)=924 pounds of corn. That is enough corn to feed one hungry person for (924/2.4) 385 days - a little more than one year.

If you fill up with ethanol, every time you pull that SUV into the gas station and pump 22 gallons, you starve a poor person for six months. Another way to look at a barrel of oil is that it has enough energy to feed a person for the entire year. Using that logic, the much debated Arctic National Wildlife Refuge -- with at least 3.2 billion barrels of oil -- contains enough food to feed the entire world for six months. If you think my estimates are wrong, you're right; the real math is actually worse.

So what does that mean for investors? When the public and politicians own up to the fact that food for fuel causes world food prices to rise and starve the poor, all those companies currently flying high on ethanol could come crashing to earth. A few of the companies that have been running on the recent ethanol excitement include Monsanto (NYSE: MON), Potash (NYSE: POT), Mosaic (NYSE: MOS), John Deere (NYSE: DE), Archer-Daniels-Midland (NYSE: ADM) and Bunge (NYSE: BG).

Kevin Kersten is an Stock and Options Analyst with InvestorsObserver.com. Disclosure note: Mr. Kersten owns and/or controls a diversified portfolio of long and short positions that may include holdings in companies he writes about.

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Earnings highlights: Morgan Stanley, FedEx, Ford, GE, Circuit City and others

Trey Thoelcke — 2008-06-21T16:40:00+00:00

Filed under: Earnings reports, General Electric (GE), Ford Motor (F), Archer-Daniels-Midland (ADM), Circuit City Stores (CC), Merrill Lynch (MER), FedEx Corp (FDX), Morgan Stanley (MS), Deere and Co (DE), Lehman Br Holdings (LEH)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

CarMax Inc. (NYSE: KMX) Q1 profits tumbled despite its aggressive expansion program.
Chiquita Brands International Inc. (NYSE: CQB) warned it would miss earnings due to cost hikes.
Circuit City Stores Inc. (NYSE: CC) Q1 loss widened as same-store sales dwindled.
Commercial Metals Co. (NYSE: CMC) Q3 profits declined despite strong demand, but beat estimates.
Coventry Healthcare Inc. (NYSE: CVH) lowered its Q2 and full-year outlooks after a disappointing April.
FedEx Corp. (NYSE: FDX) missed estimates on higher fuel prices and offered lackluster guidance.
Ford Motor Co. (NYSE: F) warned that 2008 full-year results would be worse than those of 2007.
General Electric Co. (NYSE: GE) was downgraded by JP Morgan because of risk to earnings.
J.M. Smucker Co. (NYSE: SJM) missed Q4 earnings expectations despite acquisitions-based growth.
La-Z-Boy Inc. (NYSE: LZB) said it swung to a Q4 loss due to diminishing retail sales.
Lehman Brothers Holdings Inc. (NYSE: LEH) CEO expressed his disappointment in the Q2 results.
Merrill Lynch & Co. (NYSE: MER) profit warnings and write-downs hit the rumor mill.
Morgan Stanley (NYSE: MS) beat low expectations despite a hefty decline in Q2 profits (see transcript).
Pier 1 Imports Inc. (NYSE: PIR) narrowed its Q1 loss but still fell short of expectations.
Winnebago Industries Inc. (NYSE: WGO) posted dismal Q3 results but still beat low expectations.

More earnings highlights from this week: Goldman Sachs, Best Buy, General Mills, Carnival and others

Also, BusinessWeek likes the earnings prospects for agricultural stocks such as Archer Daniels Midland (NYSE: ADM), Monsanto (NYSE: MON), and Deere & Co. (NYSE: DE).

Upcoming results to watch for include Walgreen (NYSE: WAG), Kroger (NYSE: KR), Bed Bath & Beyond (NASDAQ: BBBY), General Mills (NYSE: GIS), Monsanto (NYSE: MON), Nike (NYSE: NKE), Oracle (NASDAQ: ORCL), Research in Motion (NASDAQ: RIMM), ConAgra (NYSE: CAG), Discover (NYSE: DFS), McCormick (NYSE: MKC), Rite Aid (NYSE: RAD:), and KB Home (NYSE: KBH).

Visit AOL Money & Finance for more earnings coverage.

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Earnings highlights: Goldman Sachs, Best Buy, General Mills, Carnival and others

Trey Thoelcke — 2008-06-21T09:40:00+00:00

Filed under: Earnings reports, Archer-Daniels-Midland (ADM), Best Buy (BBY), Carnival Corp (CCL), Goldman Sachs Group (GS), General Mills (GIS), Deere and Co (DE), Western Union (WU)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

Best Buy Inc. (NYSE: BBY) beat Q1 estimates as consumers spent their government stimulus checks.
Carnival Corp. (NYSE: CCL) posted better than-expected Q2 results but offered cautious Q3 guidance.
Cyberonics Inc. (NASDAQ: CYBX) beat Q4 expectations and offered full-year guidance.
FactSet Research Systems (NYSE: FDS) had better-than-expected Q3 results and 500 new subscribers.
General Mills Inc. (NYSE: GIS) raised its full-year guidance, sending shares up near the 52-week high.
Goldman Sachs Group Inc. (NYSE: GS) results beat the previous quarter and analysts' estimates.
John Wiley & Sons Inc. (NYSE: JW.A) doubled its Q4 earnings due to an acquisition.
Life Partners Holdings Inc. (NASDAQ: LPHI) lifted its Q1 outlook after "best quarter" in company history.
Lindsay Corp. (NYSE: LNN) Q3 profits nearly doubled, but the share price plunged anyway.
Meade Instruments Corp. (NASDAQ: MEAD) narrowed its full-year net loss due to restructuring.
Pall Corp. (NYSE: PLL) beat Q1 expectations on sales growth that was broadly based across markets.
Titan Machinery Inc. (NASDAQ: TITN) beat Q1 estimates on strong demand for agricultural equipment.
Vermont Pure Holdings Ltd. (AMEX: VPS) posted strong Q2 results despite a bad debt write-off.
Western Union Co. (NYSE: WU) said 2008 profits would beat estimates and announced share buyback.

More earnings highlights from this week: Morgan Stanley, FedEx, Ford, GE, Circuit City and others

Also, BusinessWeek likes the earnings prospects for agricultural stocks such as Archer Daniels Midland (NYSE: ADM), Monsanto (NYSE: MON), and Deere & Co. (NYSE: DE).

Visit AOL Money & Finance for more earnings coverage.

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Some agricultural stocks to consider from BusinessWeek

Eliza Popescu — 2008-06-20T15:17:00+00:00

Filed under: Forecasts, Consumer experience, Competitive strategy, Archer-Daniels-Midland (ADM), Economic data, Deere and Co (DE), Commodities, Agriculture, Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT)

When natural disasters happen, there are always some companies that can turn the circumstances in their favor. Recent downpours in the Midwest provided such an opportunity as they came not only with high damages for people in the area, but also with floods for crop production, causing even higher agricultural commodity prices. The rise in corn and soybeans prices could easily lead to an increased demand for seeds, agricultural equipment, and fertilizers. BusinessWeek suggests some big names to invest in that could offer us the advantages we are looking for.

One such company is Archer Daniels Midland (NYSE: ADM), which could also benefit from higher ethanol prices, after purchasing seven businesses in 2007. Bunge Limited (NYSE: BG) is also amid possible winners, having forecast better-than-expected fertilizer earnings. Shell eggs producer Cal-Maine Foods (NASDAQ: CALM) is also on the selected list; the company saw its shares climb 15% year to date, and has just revealed a new dividend payout policy.

Another important name is Mosaic Co. (NYSE: MOS), whose stock prices have surged 70% so far this year. BusinessWeek cites Mosaic as being able to benefit from higher prices for fertilizer and potash. Following the same logic, the article points out potash provider Potash Corp. of Saskatchewan (NYSE: POT) and fertilizer distributor CF Industries Holdings (NYSE: CF), which should be able to take advantage of the weak dollar and higher sales prices.

Another stock to consider is Monsanto (NYSE: MON), which should benefit from higher planted corn acreage and strong seed prices. At the same time, farm-equipment makers such as John Deere (NYSE: DE) are expected to see an increase demand for their products as farmers will need more and more tractors to boost their activity.

However, those are only a few big names that BusinessWeek recommends to us. To get a clearer and more comprehensive image of these potential companies and their chances, just take a look at the BusinessWeek slide show.

Eliza Popescu is a financial writer for the online investment advisory service Investor's Observer.

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Favorite farm stocks, millions more could get rebate check & downtowns in danger - Today in Money 6/20

Allan Halprin — 2008-06-20T08:43:00+00:00

Filed under: Yahoo! (YHOO), Starbucks (SBUX), General Motors (GM), Money and Finance Today, Archer-Daniels-Midland (ADM), Contl Airlines'B' (CAL), UAL Corp (UAUA), Deere and Co (DE), Potash Corp. of Saskatchewan (POT), MBIA Inc (MBI)

In the News

· Continental, United Airlines Align to Lower Costs

· Moody's Cuts Bond Insurers MBIA, Ambac Ratings

· General Motors Stops Major Overhaul of Pickups, SUVs

· Yahoo's Turmoil Spreads as Top Executives Flee

· Yahoo Planning to Reorganize

· Starbucks Bringing Back Bolder Coffee

· Winnebago Sales Plunge

· Girlfriend of Missing Hedge Fund Swindler Arrested

· Some Gas Stations Declining Credit Cards

· Sorry, Charlie: Del Monte May Sell StarKist

Farm Stocks: Pick of the Crop
Millions of acres of farmland may be under water, but some agricultural outfits stand to benefit as higher prices lead to demand for seeds, equipment, and fertilizer. They include Archer Daniels Midland, Mosiac, Potash Corp., Agriam, Monsanto and John Deere.
Ag Stocks: Farm Favorites

Millions More Could Get a Rebate If They File a Return
Even as the IRS has sent out nearly 77 million tax rebates, more than 5 million retirees and disabled veterans who may qualify for a rebate haven't received one because they haven't filed a tax return.
Millions more could get a rebate if they file a return - USATODAY.com

Downtowns in Danger of Going Downhill, Again
In recent years many once moribund downtowns received funding to begin impressive comebacks as both residential and commercial centers. But as the economy stumbles and the money dries up, many projects are stalling. Will these downtowns be able to survive the downturn? From L.A. to Richmond and Atlanta to Seattle see which project are in danger in 13 cities.
Are Downtowns in Danger of Going Downhill Again?
In Pictures: Downtowns in Downturn

Credit Scores: Now Lifestyle Matters Too
Lenders may be monitoring your bar tab or marriage counseling bill - which could be costly for consumers.
Are Creditors Eyeing Your Purchases? - BusinessWeek

To Save Money at Gas Pump, Pay Cash
Filling stations are slapping a 6¢-a-gallon premium on credit-card customers, to help offset the hefty fees such purchases involve.
To Save Money at the Gas Pump, Pay Cash

6 Destinations to See Before It's Too Late
Global warming is expected to ruin some of the world's most beautiful tourist spots. They include Glacier National Park, Montana, The Maldives, Mount Kilimanjaro, Mauritius, Lake Mead in Neveda and Churchill, Manitoba.
6 Vacation Spots Threatened by Global Warming -SmartMoney.com

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Analyst downgrades: BUD, BRP and FNSR

Eric Buscemi — 2008-06-13T11:07:00+00:00

Filed under: Analyst reports, Analyst upgrades and downgrades, Anheuser-Busch Cos (BUD), Archer-Daniels-Midland (ADM)

MOST NOTEWORTHY: Anheuser-Busch, Brasil Telecom and Finisar were today's noteworthy downgrades:

UBS downgraded Anheuser-Busch (NYSE: BUD) to Neutral from Buy citing the InBev unsolicited bid.
JP Morgan cut Brasil Telecom (NYSE: BRP) to Underweight from Neutral on concerns over the merger with Telemar.
Piper downgraded Finisar (NASDAQ: FNSR) to Neutral from Buy following strong Q4 results, as they believe the company's acquisition of Optium creates substantial integration risk.

OTHER DOWNGRADES:

Merrill cut Weyerhaeuser (NYSE: WY) to Neutral from Buy.
PDL BioPharma (NASDAQ: PDLI) was downgraded to Neutral from Outperform at Credit Suisse.
Wachovia downgraded McClatchy News (NYSE: MNI) to Underperform from Market Perform.
Archer Daniels (NYSE: ADM) was downgraded to Equal Weight from Overweight at Morgan Stanley.

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Investing in Everyone: Defense, Food, Power, Clinton, Obama, and McCain

Sheldon Liber — 2008-05-27T19:05:00+00:00

Filed under: International markets, Other issues, Rants and raves, Archer-Daniels-Midland (ADM), Duke Energy (DUK), Politics, Presidential elections, General Dynamics Corp (GD), Southern Company (SO), Raytheon Company (RTN), Bunge Ltd. (BG), Potash Corp. of Saskatchewan (POT)

I have not decided who I am voting for yet. Or maybe it would be more accurate to say I have decided on multiple occasions only to become undecided again. While some will see me as fickle, or worse, others may be in the same boat.

I am also continuing to think about what difference any of the candidates can make on the economy, and based on these musings, where to invest. My current belief is that none of them will have a profound impact on our economy.

There are no financial wizards among them. Here is the shocker though: I like all three candidates, or at least can find some good in each of them. Each of them is a fighter, and I believe each one of them brings certain skill sets to the job. There are also things about each candidate that are inescapably negative. Clinton has so much baggage, Zsa Zsa Gabor would be jealous. Obama does not have the experience and he has a degree of arrogance (right sweetie); McCain is an old stick-in-the-mud who, as a long-time senator, has spent more hours with lobbyists than almost anybody, though he is pretending otherwise.

Where does this leave me from an investment perspective? My first choice, for stability with moderate growth and dividends, remains the defense sector. I wrote Defense sector rolls over S&P 500 for 8th straight year a while back and I still think that it is the most secure. Here's why:

A) None of the candidates will want to appear soft on defense when we are at war, and all three have made threatening remarks in some country's direction to make sure the electorate knows that.

B) The War in Afghanistan and Iraq rages on, and even the most optimist view is that a draw-down will take years.

C) Even if all war ceased immediately, the upgrading and replenishment of the hardware will cost billions of dollars and most of the defense contractors have that in their backlogs now. Chasing Value: General Dynamics & Raytheon -- The defense does not rest

Mike Huckabee made news by suggesting he would be delighted to pair up with John McCain as his VP running mate. He is another guy that has a real hunger to be heard, but has no interest in a real job. While this may strengthen the party ticket, shoring up conservative support, historically successful candidates move to the center in the general election. Huckabee would lose him as many votes as he would gain.

Nobody is more hungry to be president then Hillary Clinton, who may view this go-around as her one shot at the oval office, since the next occupant could be there eight years if they don't screw up too bad (right Dubya).

Hillary Clinton is doing some big time pandering to stay in the presidential race, and does not look like she has lost any of her fight yet. She seems to be the most polarizing of the three candidates, because there are many that simply do not trust her. Oddly, if this were any other type of race, trust might not be an issue, just success -- and an argument could be made that she might be the most successful. For all her husband's problems in office, the economy was humming and legislation was moving.

There are a growing number of hungry folk -- the continuous rise in food prices has supported one of my thesis from last December Serious Money: ADM, Bunge, Potash Corp. -- it's a hungry world and I expect, like the defense sector this is still a smart place to be investing, although these three stocks are on the pricey side. However, who is to say they have topped out. Archer-Daniels-Midland (NYSE: ADM), Bunge Ltd. (NYSE: BG) and Potash Corp. of Saskatchewan (NYSE: POT) dominate a major portion of he world market in grains, oils and fertilizers.

A) Our sinking dollar makes our prices on the world market more competitive.

B) China, Russia, India, Brazil -- the whole world for that matter have been adding more meat to their diets and that is raising the price of everything. The number of capitalists has doubled!

C) Diets will change in tough economic times, but food will remain a higher priority than most everything else.

Looking beyond the economics of guns and butter for other themes and hearing every day the drum beat that change is afoot, I wonder where else things might remain stable or grow. What comes to mind is power, and I have thought this for quite some time -- Serious Money: Electric utilities are the place to be. I still like the Southeast U.S. and own stock in Duke Energy (NYSE: DUK) and the Southern Company (NYSE: SO) for the long haul.

A) Power companies will be open for business every day of the year and pay solid dividends.

B) Even if housing is down and foreclosures are increasing, someone will own the homes and they will still need the power company.

C) The increase in consumer products requiring power, and the movement toward electric vehicles, will increase demand.

Speaking of a newcomer that seeks power -- Barack Obama promotes himself as the candidate of change. I ask, CHANGE WHAT? Does he think he can become more touchy-feely, like Jimmy Carter, and make nice to everyone? That did not work. He wants to bring us all together, but that's not going to happen. Some folks want to eliminate capital gains taxes and others want to raise them; some want to stop all abortions and others want a women to have a right to choose; and some want health care coverage to be provided by the private sector and others want the government to take over. There will have to be a compromise, but there will be a battle royale to get there.

The Democrats are happy to run against Bush, because even many Republicans would not like to do the Bush economy over again and economics does not seem to be McCain's strong suit anyway. If Obama is the survivor of the political process ("winner" does not seem apt), the biggest surprise will be the economy. Since he is the biggest wild-card, we may see the market go soft, at least in the short term, if he is elected.

One of the most fascinating things about the economy, reported on this site and in business journals, is that the economy often does the best when there is a log jam in Washington and nothing happens. Maybe the economy would improve the fastest if Bush left office and we had a one-year moratorium in Washington and they all just went home. There was a time, a long time ago, when that's how it was.

No matter who wins the election, I think the defense, food and energy sectors will remain strong and the housing sector, airlines, and retail remains weak for a few more years. In this case the past may be a good predictor of the future.

Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money. Disclosure: I own shares in DUK, GD & SO.

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Cramer on BloggingStocks: Oil's not the widespread tax it used to be

Jim Cramer — 2008-05-19T09:22:00+00:00

Filed under: General Electric (GE), Exxon Mobil (XOM), Market matters, Halliburton (HAL), Schlumberger Limited (SLB), Alcoa Inc (AA), Archer-Daniels-Midland (ADM), Bank of America (BAC), Boeing Co (BA), Chesapeake Energy (CHK), Chevron Corp (CVX), duPont(E.I.)deNemours (DD), Office Depot (ODP), Deere and Co (DE), Honeywell Intl (HON), United Technologies (UTX), Eaton Corp (ETN), Anadarko Petroleum (APC), Oil, Stocks to Buy, Burlington Northern Santa Fe (BNI), Norfolk Southern Corp. (NSC), Union Pacific Corporation (UNP), Cramer on BloggingStocks, Potash Corp. of Saskatchewan (POT)

TheStreet.com's Jim Cramer says lots of companies now thrive with crude up here.

Oil's not a tax on everything -- it's a tax on the consumer. That's what I come down to when I see the charts this weekend and ponder what's happening in so much of industrial America.

Company after company that I examine -- the new techs, as I call them -- actually benefit from higher oil prices. Or they can pass them on with ease, because of the worldwide demand being so strong.

Take all of the companies involved with making a Boeing (NYSE: BA) (Cramer's Take): Boeing itself, Alcoa (NYSE: AA) (Cramer's Take), Honeywell (NYSE: HON) (Cramer's Take) and Precision Castparts (NYSE: PCP) (Cramer's Take) being good examples. Each of these is necessary because the new Dreamliner burns lots less fuel, and with fuel the biggest airline cost, it stands to reason that higher energy prices make the plane more desirable even at a higher price point.

Or how about all of the companies involved with process and flow control and efficient motors: Parker-Hannifin (NYSE: PH) (Cramer's Take), Emerson (NYSE: EMR) (Cramer's Take), Eaton (NYSE: ETN) (Cramer's Take) and Flowserve (NYSE: FLS) (Cramer's Take). Those work higher with higher energy prices. CSX (NYSE: CSX) (Cramer's Take), Burlington Northern (NYSE: BNI) (Cramer's Take), Kansas City Southern (NYSE: KSU) (Cramer's Take), Union Pacific (NYSE: UNP) (Cramer's Take) and Norfolk Southern (NYSE: NSC) (Cramer's Take) are smaller energy users than trucks, and they ship plenty of ethanol and fertilizer.

Of course everything farming: Deere (NYSE: DE) (Cramer's Take), Monsanto (NYSE: MON) (Cramer's Take), Du Pont (NYSE: DD) (Cramer's Take), AGCO (NYSE: AG) (Cramer's Take), Potash (NYSE: POT) (Cramer's Take), Agrium (NYSE: AGU) (Cramer's Take), Mosaic (NYSE: MOS) (Cramer's Take) and Archer Daniels (NYSE: ADM) (Cramer's Take) (these are big companies in market cap now, powers of the S&P or companies just waiting to get into the S&P but stalled by a lack of mergers). And everything that drills, ships and transports oil and gas: Rowan (NYSE: RDC) (Cramer's Take), Parker (NYSE: PKD) (Cramer's Take), Weatherford (NYSE: WFT) (Cramer's Take), Cameron (NYSE: CAM) (Cramer's Take), Noble (NYSE: NE) (Cramer's Take), Transocean (NYSE: RIG) (Cramer's Take), FMC Tech (NYSE: FTI) (Cramer's Take), Oceaneering (NYSE: OII) (Cramer's Take) and so many others -- and of course, Halliburton (NYSE: HAL) (Cramer's Take) and Schlumberger (NYSE: SLB) (Cramer's Take).

And then there is oil and gas itself, ever a larger portion of the S&P. Look at the charts during last week's run: Apache (NYSE: APA) (Cramer's Take), Anadarko (NYSE: APC) (Cramer's Take), Nabors (NYSE: NBR) (Cramer's Take), Exxon (NYSE: XOM) (Cramer's Take), Chevron (NYSE: CVX) (Cramer's Take), Occidental (NYSE: OXY) (Cramer's Take), XTO (NYSE: XTO) (Cramer's Take), Southwestern (NYSE: SWN) (Cramer's Take), Chesapeake (NYSE: CHK) (Cramer's Take), Ultra (NYSE: UPL) (Cramer's Take): these all count.

Coal, of course, is a huge beneficiary. Infrastructure works because these companies get the benefits of the oil companies' largesse by being able to build energy-related production centers.

Even the autos can be viewed as benefitting, as the newer cars use less gas than the old ones, making them viable alternatives in multiyear paybacks. Along those lines, energy-efficient appliances get a boost.

Then there are the myriad energy-alternative plays that are always dominating the headlines but haven't yet made it into the S&P or are very small parts of the S&P: the wind plays -- Trinity (NYSE: TRN) (Cramer's Take), Woodward Governor (NASDAQ: WGOV) (Cramer's Take), Owens Corning (NYSE: OC) (Cramer's Take) (also insulation); solar -- First Solar (NASDAQ: FSLR) (Cramer's Take) ($24 billion market cap), SunPower (NASDAQ: SPWR) (Cramer's Take), and all the Chinese plays that people love so much.

Pipelines galore: Kinder Morgan (NYSE: KMP) (Cramer's Take), Enterprise (NYSE: EPD) (Cramer's Take), Boardwalk (NYSE: BWP) (Cramer's Take), so many others.

Many companies are neutral -- financial, telco, utilities -- although some benefit from the price umbrella of higher oil costs and can pass on costs they don't have. Tech's been fairly neutral. The weaknesses we have seen in tech are related to consumer slowdown (customers such as Office Depot (NYSE: ODP) (Cramer's Take)) or financial. Media's neutral, too. Health care can't be considered a negative either when it comes to energy consumption.

Most of the conglomerates say they are energy-positive: United Tech (NYSE: UTX) (Cramer's Take) and, famously, GE (NYSE: GE) (Cramer's Take), which has said that its fortunes should improve as oil goes higher, although we haven't seen that yet.

We know there are plenty that don't. Anything that is sold in the supermarket. Anything retail. Anything that uses oil or natural gas and can't really pass it on: Minerals and mining (although global demand really helps), glass (although recycling really helps, as in the case of Owens-Illinois (NYSE: OI) (Cramer's Take)), and chemicals and the paper producers.

But those companies aren't that important anymore, even though they dominate the consciousness of the marketplace, despite the encroachment of energy as a part of the S&P 500.

In fact, if finance could turn itself around -- something that seems increasingly possible, although it has sucked up a huge amount of capital and done nothing -- you could argue that we are on the cusp of a major move as it dawns on people that energy isn't the tax it used to be.

There are plenty of 30,000-foot flaws to this. We have seen time and again that our own growth in this country is heavily consumer-related. But the industrial growth owes itself not to the U.S. consumer, but the worldwide consumer.

All of these facts can go far toward explaining how higher oil prices have not been able to block the advance of the S&P or the Dow Jones averages. In fact, if the latter were more responsive to energy -- the Chevron nod was accompanied by ne'er-do-well Bank of America (NYSE: BAC) (Cramer's Take) instead of a Deere or another oil play like an Occidental or a Schlumberger -- we would be taking out 13,000 with ease.

All of this is worth thinking about when you are gloomy, because it doesn't add up to a decline, it explains the advance.

Keep it in mind during the next downturn. It explains a lot why they've been fairly shallow.

And I don't expect anything deeper now that finance seems to have stabilized.

RELATED LINKS:

Jim Cramer is a director and co-founder of TheStreet.com. He contributes daily market commentary for TheStreet.com's sites and serves as an adviser to the company's CEO. At the time of publication, Cramer was long XTO and Owens-Illinois.

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Earnings highlights: Exxon, GM, Time Warner, Starbucks, P&G, ADM and others

Trey Thoelcke — 2008-05-03T10:10:00+00:00

Filed under: Earnings reports, Time Warner (TWX), Starbucks (SBUX), General Motors (GM), Exxon Mobil (XOM), Archer-Daniels-Midland (ADM), Chesapeake Energy (CHK), Kellogg Co (K), Colgate-Palmolive (CL), Corning Inc (GLW), Procter and Gamble (PG), Under Armour'A' (UA), Duke Energy (DUK), Burger King Hldgs (BKC), Valero Energy (VLO), Kraft Foods'A' (KFT), Time Warner Cable (TWC), Garmin Ltd (GRMN)

Here are some highlights from this past week's earnings coverage from BloggingStocks:

Archer Daniels Midland Co. (NYSE: ADM) Q3 profits soared, beating analysts' expectations.
Buffalo Wild Wings Inc. (NASDAQ: BWLD) strong Q1 results met analysts' expectations.
Burger King Holdings Inc. (NYSE: BKC) reported solid Q3 results that beat Wall Street estimates.
Chesapeake Energy Corp. (NYSE: CHK) beat expectations for the first quarter, sending shares up.
Colgate-Palmolive Co. (NYSE: CL) posted better-than-expected Q1 results on the weak dollar.
Corning Inc. (NYSE: GLW) beat earnings expectations and raised its guidance.
Corn Products International (NYSE: CPO) posted record sales for the ninth consecutive quarter.
Duke Energy Corp. (NYSE: DUK) Q1 profits met expectations but revenues beat them.
ExxonMobil Corp. (NYSE: XOM) missed Q1 expectations due to narrower margins.
Garmin Ltd. (NYSE: GRMN) reported lower-than-expected earnings due to slowed demand.
General Motors Corp. (NYSE: GM) posted a smaller-than-expected loss for the first quarter.
Herbalife Ltd. (NASDAQ: HLF) posted Q1 results and announced the resignation of the president and COO.
Kellogg Co. (NYSE: K) beat Q1 expectations and announced a 10% dividend increase.
Kraft Foods Inc. (NYSE: KFT) Q1 profits declined but beat analysts' expectations.
Procter & Gamble Co. (NYSE: PG) reported better-than-expected Q1 results and raised its 2008 outlook.

Starbucks Corp. (NASDAQ: SBUX) posted weak Q2 earnings in line with Wall Street expectations.
Time Warner Cable Inc. (NYSE: TWC) beat Q1 expectations and reaffirmed its guidance.
Time Warner Inc. (NYSE: TWX) posted solid Q1 results and announced a spin-off of TWC.
Under Armour Inc. (NYSE: UA) beat Q1 expectations but lowered its full-year outlook.
Valero Energy Corp. (NYSE: VLO) blew past Q1 EPS expectations despite despite profits plunging 77%.

Also, Jim Cramer lauds Procter & Gamble for its success in these tough times and Colgate-Palmolive for bouncing back after taking a hit. And Time Warner investors may have been looking for more than they got in the quarterly report.

Upcoming results to watch for include Anadarko Petroleum (NYSE: APC), Cisco Systems (NASDAQ: CSCO), Fannie Mae (NYSE: FNM), Molson Coors (NYSE: TAP), Walt Disney Company (NYSE: DIS), and American International Group (NYSE: AIG).

Visit AOL Money & Finance for more earnings coverage.

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Corn Products International (CPO): Shares in bullish 'flag' formation

Larry Schutts — 2008-05-02T13:31:00+00:00

Filed under: Earnings reports, Archer-Daniels-Midland (ADM), Abercrombie and Fitch (ANF), Activision Inc (ATVI), Technical Analysis, Stocks to Buy

Corn Products International (NYSE: CPO) manufactures and markets food ingredients and industrial products derived from corn and other starch-based materials. Major offerings include sweeteners, corn oil, salad dressings, shortening, vitamins, corn gluten feed, food-grade starches and industrial starches. The firm operates manufacturing plants in the Americas, Africa and Asia, serving customers in the food, beverage, pharmaceutical, paper, textile, and brewing industries. Archer Daniels Midland (NYSE: ADM) is a major competitor.

Investors were pleased last week, when the company reported fiscal Q1 EPS of 85 cents and revenues of $930.9 million. Analysts had been looking for 71 cents and $867.9 million. Net sales set a record, for the ninth consecutive quarter. The firm also guided FY08 EPS to $2.90-$3.10 ($2.87 consensus) and FY08 revenues to $4.0 billion ($3.78 billion consensus).

The CPO share price popped on the news and then moved into a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.

Brokers recommend the shares with two "strong buys", three "buys" and two "holds". The CPO P/E ratio (16.78), Price to Sales ratio (0.95), Price to Book ratio (1.92), Price to Cash Flow ratio (9.90), Sales Growth rate (22.18%) and EPS Growth rate (28.79%) compare favorably with industry, sector and S&P 500 averages. Institutions own about 86% of the outstanding shares. The stock is one of those used to calculate the S&P 400 MidCap Index. Over the past 52 weeks, it has traded between $31.42 and $49.30. A stop-loss of $40.25 looks good here.

Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold positions in either of the stocks mentioned above.

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Before the bell: MRK, BP, ADM, MA, CFC, AAPL ...

Melly Alazraki — 2008-04-29T08:25:00+00:00

Filed under: Before the bell, Earnings reports, Apple Inc (AAPL), XM Satellite Radio (XMSR), Sirius Satellite Radio (SIRI), Archer-Daniels-Midland (ADM), Avon Products (AVP), CBS Corp 'B' (CBS), MasterCard Inc'A' (MA), Corning Inc (GLW), Countrywide Financial (CFC), BP p.l.c. ADS (BP), Merck and Co (MRK), U.S. Steel (X), Valero Energy (VLO)

Before the bell: Street awaits Fed (V, DB, GM)

Merck & Co. (NYSE: MRK) shares are dropping over 8% in premarket trading after it said its cholesterol pill Cordaptive failed to win approval from the U.S. Food and Drug Administration, less than a week after it was recommended for marketing in the European Union. While Merck intends to submit more data to the FDA, it is unclear it will succeed given even some European doctors said more research is needed on one of the drug's main components safety.

Who said higher oil prices aren't good? If you ask Royal Dutch Shell (NYSE: RDS.A) and BP (NYSE: BP), high oil prices are fantastic as the two oil giants beat forecasts when posting quarterly earnings Tuesday, reporting that net income, excluding unrealized gains from changes in inventory values, rose 12% to a record $7.8 billion and 48% to $6.6 billion respectively. Shell shares are climbing 5.7% in premarket trading and BP's over 4.8% as it seems investors think oil above $100 a barrel is here to stay.

Archer Daniels Midland Co. (NYSE: ADM), the world's largest grain processor, said third-quarter profit rose 42% to $517 million or 80 cents per share, topping analyst estimates of 69 cents per share, as it traded more grains and crushed more soybeans. Sales climbed 64% to $18.7 billion. Seems that being in agriculture lately is a positive and ADM shares are rising 3.75% in premarket trading.

We're still in the midst of earnings season, and today is a big day:

A day after Visa reported its first quarterly results, posting considerable growth, beating estimates but still disappointing investors, MasterCard (NYSE: MA) just reported results minutes ago. From first glance it seems that MA also handily beat expectations of earnings or $1.99 per share.

Countrywide Financial Corp. (NYSE: CFC) is projected to post earnings of 2 cents a share in the first quarter, Valero (NYSE: VLO) -- 29 cents a share, CBS Corp. (NYSE: CBS) -- 33 cents a share, Corning (NYSE: GLW) -- 42 cents a share, Avon (NYSE: AVP) -- 43 cents a share and United States Steel (NYSE: X) -- $1.84 a share.

And good news everybody. Yes, I know Canada is a small market, despite its large land mass, but it's my market and Apple Inc. (NASDAQ: AAPL)'s iPhone isn't here yet. Despite being the U.S.'s neighbor, the iPhone went to Europe first and only today it was announced by Rogers Communications (NYSE: RCI) it has reached an agreement with Apple to bring the iPhone to Canada later this year. Always later ...

XM Satellite Radio (NASDAQ: XMSR) today announced that it has postponed its 2008 annual meeting of stockholders to a date when it has further information relating to its pending merger with SIRIUS Satellite Radio (NASDAQ: SIRI).

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Countrywide's Q1 profit expected to tumble, ADM's to rise

Trey Thoelcke — 2008-04-28T18:15:00+00:00

Filed under: Earnings reports, Forecasts, Archer-Daniels-Midland (ADM), Countrywide Financial (CFC)

Analysts surveyed by Thomson Financial expect Countrywide Financial (NYSE: CFC) to post a much smaller profit for the first quarter, while Archer Daniels Midland (NYSE: ADM) is expected to report a profit gain. Both companies are scheduled to report results Tuesday morning.

Countrywide Financial is expected to earn two cents per share, which is down 97% from the same period in 2007 when it earned 72 cents per share, but that swings from a loss of 79 cents per share in the most recent quarter. However, the company tended to fall short of earnings estimates even before the credit crunch set in; that fourth-quarter loss of 79 missed estimates by 163%.

Formerly one of the top residential mortgage lenders, California-based Countrywide Financial is being bought out by Bank of America (NYSE: BAC). In the past year, Countrywide's revenues were $24 billion, and its net income is in the red to the tune of $703.5 million. Not surprisingly, the consensus recommendation of analysts remains to hold CFC.

The stock has fallen 84.9% in the past year and closed Monday at $5.83.

ADM is expected to earn 69 cents per share, up 26.1% from the same period in 2007 when it earned 51 cents per share. The company has tended to beat quarterly estimates recently. In the third quarter of 2007, it beat the consensus estimate by 19.7%, but in the fourth quarter only by 1.4%.

The Decatur, Illinois-based grain-processing giant is benefiting from rising commodities prices and demand for ethanol. In the past year, ADM's revenues were $44 billion and its net income was $2.2 billion. The company's EPS growth forecast for the year is 28.1%, which is much better than both its industry and sector averages. The consensus recommendation of analysts is to buy ADM, and has been for more than 90 days.

The stock has risen 21.6% in the past year and trades at a P/E of 13.83. Shares closed Monday at $47.42.

For other news that could influence these results, see BloggingStocks' Countrywide Financial coverage and ADM coverage.

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