MOST NOTEWORTHY: Invesco, Kimberly Clark and Crawford & Company were today's noteworthy initiations:
Jefferies finds Invesco (NYSE: IVZ) compelling given the company's focus on expense control, strong cash flow characteristics, and attractive valuation. Shares were assumed with a Buy rating and $33 target.
Caris started Kimberly Clark (NYSE: KMB) with a Below Average rating and $58 target. The firm believes consensus estimates may be too high given the high cost of commodities.
Suntrust started Crawford & Company (NYSE: CRDB) with a Buy rating and $8 target, and believes the company is at the "front end" of a turnaround in operations.
OTHER INITIATIONS:
Bernstein initiated Energizer Holdings (NYSE: ENR) with an Outperform rating and $100 target.
BMO Capital assumed Range Resources (NYSE: RRC) with an Outperform rating and $85 target.
Intrepid Potash (NYSE: IPI) was started with a Sell rating and $40 target at Soleil.
This post is part of our Battle of the Brands feature. Let us know which brand you prefer, and check out other Battle of the Brands posts.
In the world of diapers, try as other brands might to gain a foothold, it is really a Pampers vs. Huggies world.
Pampers, made by Procter & Gamble (NYSE: PG) has been the market share winner for decades and is P&G's top global brand. But Huggies, made by Kimberly-Clark (NYSE: KMB) has made significant inroads thanks to frequent discounts.
Consumer Reports estimates parents will spend between $1,500 and $2,000 on disposable diapers before their child is potty trained. With that kind of investment, many parents have strong views about which brand is best. Leakage control and rash prevention are the main criteria. Consumer reports rates Pampers (both its Cruisers and Baby Dry brands) higher than Huggies, mainly due to Pampers' superior leakage prevention.
Baby blogs also seem to favor Pampers over Huggies. And in my experience, I do think of Pampers as the "premium" and was surprised that when I actually checked price tags in my local drug store this week, found that they were priced exactly the same.
For my diaper dollar, I don't see much of a difference between the two. I'm all for changing the baby more often and buying a cheaper diaper. If you really put the diapers to the test with, say an eight-hour day at the playground without a change, you might find a difference. But my priority is to spend as little time and money diaper shopping as possible. Costco stocks Huggies in bulk, so that's what we have now.
Kimberly-Clark (NYSE: KMB) reported for the first quarter today. Net sales increased almost 10% to $4.8 billion. Adjusted earnings per share increased 5% to $1.08. That's a rather small jump, granted, but you know something, it was enough to keep the stock in the green (at the time of this writing, at least) instead of in the red on a day when the major market averages -- and just about all of the stocks in my personal portfolios -- are bathing in the evil crimson color of doom. And according to Briefing.com, Kimberly-Clark played the beat-the-expectations game and won by the proverbial penny! Shareholders should be pleased.
A non-pleasing item to be found in the release centers on cash from operations -- it decreased by about $100 million to $426 million due to changes in working capital. That doesn't concern me so much right now, though, since Kimberly-Clark will probably do well over the coming years in terms of cash generation. The company, by the way, has been repurchasing stock, so management seems pleased with the shares as a potential investment idea.
Kimberly-Clark, which is a consumer-products business in the league of entities such as Procter & Gamble (NYSE: PG), Energizer (NYSE: ENR), Colgate-Palmolive (NYSE: CL), and Unilever (NYSE: UL), could be a value right now based on its P/E ratio and dividend yield. Out of the stocks mentioned here, I like P&G the best, but I do respect Kimberly-Clark -- in fact, it was mentioned recently in an article by Steven Halpern that centered on an analyst's picks for quality and yield.
Disclosure: I don't own shares in any of the companies mentioned; positions can change at any time.
Investment Quality Trends -- one of the most respected newsletters in the advisory field -- uses a proprietary strategy that assesses historic level of stock price to yield; it's goal is to buy those stocks offering the best potential for downside protection and upside appreciation.
Here, editor Kelley Wright explains his methodology and highlights his current "Timely Ten" stocks that best match his time-tested criteria.
"Investors who wished to hold every stock in that we currently rank in the 'Undervalued and Rising Trend' categories, would need to hold one hundred twenty six stocks as of March; clearly too many positions to be practical.
"Our Timely Ten, therefore, is our reasoned expectation based on our methodology and experience for what we believe will perform best over the next five years.
"Do we believe that all 10 will go up simultaneously or immediately? Of course not. Our four decades of research and experience, however, leads us to believe that these stocks, purchased at current Undervalued levels, are well positioned for appreciation.
MOST NOTEWORTHY: Corinthian Colleges, MSC Industrial and HBOS Plc were today's noteworthy downgrades:
Piper downgraded shares of Corinthian Colleges (NASDAQ: COCO) to Neutral from Buy as they expect the company to face difficulty maintaining Title IV lending at its high default rate schools.
Jefferies downgraded shares of MSC Industrial (NYSE: MSM) to Hold from Buy on valuation, as there is not enough upside to their $50 target to maintain a Buy rating
Credit Suisse lowered HBOS Plc (OTC: HBOOY) to Underperform from Neutral to reflect the weakening housing and mortgage environment.
OTHER DOWNGRADES:
Salesforce.com (NYSE: CRM) was cut to Market Perform from Outperform at Bernstein.
B. Riley lowered Iomega (NYSE: IOM) to Neutral from Buy.
Zebra Technologies (NASDAQ: ZBRA) provides printers, supplies and software used to produce bar codes, text and graphics on labels, cards, receipts, tickets and tags. It also makes EPC-compatible radio frequency identification (RFID) smart label printers/encoders for firms required to comply with major retail and government mandates. The company's products are used by businesses and governments in over 100 countries around the world, including more than 90% of the firms in the Fortune 500. Major clients include AMR Corporation (NYSE: AMR), Caterpillar (NYSE: CAT) and Kimberly-Clark (NYSE: KMB).
The Street was surprised late last month, when the company reported Q4 EPS of 45 cents and revenues of $233.6 million. Analysts had been looking for 43 cents and $226 million. Management also guided Q1 EPS to 36-44 cents (42 cent consensus) and Q1 revenues to $238-$255 million ($232.78M consensus). The Board authorized the purchase of an additional three million common shares.
In sharp contrast to the ten horrifically downtrending stocks I warned against buying in this article, today I feature these 10 solidly uptrending stocks.
It's charts like theirs that make you wonder why you're messing around with any other stocks. Ahhh, if it was only that easy. No matter that all the stocks listed above are making new highs, now the concern is that they may have come too far too fast. In 2008, several of these stocks-the gold plays in particular-have risen nearly 50%. Obviously the oil stocks have also been surging, but how much further can the "black gold" plays really run?
MOST NOTEWORTHY: ICF International, General Mills, Kellogg and Caterpillar were today's noteworthy upgrades:
Jefferies upgraded shares of ICF International (NASDAQ: ICFI) to Buy from Hold on valuation to reflect the company's accelerating core business momentum and upped Road Home funding.
Citigroup raised its rating on General Mills (NYSE: GIS) and Kellogg (NYSE: K) to Buy from Hold on valuation, as they believe food consumption stocks are recession proof.
Bear Stearns upgraded shares of Caterpillar (NYSE: CAT) to Outperform from Peer Perform as they believe the company will benefit from the interest rate cuts.
OTHER UPGRADES:
Merck (NYSE: MRK) was raised to Buy from Neutral at UBS.
El Paso (NYSE: EP) was upgraded to Overweight from Equal Weight at Morgan Stanley.
Lehman raised Kimberly Clark (NYSE: KMB) to Overweight from Equal Weight.
One of the nation's largest homebuilders, Lennar, reported a $1.25 billion loss in the fourth quarter -- its largest ever -- as the housing slump drove prices lower and the builder took hefty charges. Lennar also reported a $1.9 billion loss for all of 2007. The Miami-based company said it was aggressively trying generate cash and lower inventory.
Quarterly losses rose to $7.92 per share, from $195.6 million, or $1.24 per share, a year ago. Revenue fell 49% percent to $2.18 billion from $4.27 billion in the same period of 2006, as both home deliveries and new orders fell 50%. The results topped the consensus forcast of analysts surveyed by Thomson Financial, who had expected a loss of $1.65 per share on revenue of $2.06 billion (these estimates typically exclude one-time charges such as land write-downs).
For the year ending November 30, Lennar's losses come to $12.31 per share, compared with profits of $593.9 million, or $3.69 per share, in 2006. Shares closed up 8.5%, to $16.21.
MOST NOTEWORTHY: Deere, Boeing and Air France were today's noteworthy upgrades:
Banc of America upgraded shares of Deere (NYSE: DE) to Buy from Neutral and raised their target to $186 from $130 as they expect upside in 2008 from favorable global agriculture fundamentals.
Wachovia raised its rating on Boeing (NYSE: BA) to Outperform from Market Perform citing favorable risk/reward as domestic economic concerns and 787 development risks are discounted in valuation.
Air France (NYSE: AKH) was upgraded to Buy from Hold at Citigroup, as they believe the company's joint venture with Delta Air Lines (NYSE: DAL) will boost margins.
OTHER UPGRADES:
Baird upgraded OmniVision (NASDAQ: OVTI) to Neutral from Underperform.
Deutsche Bank upgraded Philips Electronics (NYSE: PHG) to Buy from Hold.
Tidewater (NYSE: TDW) was upgraded to Buy from Hold at Jefferies.
Lehman raised Kimberly Clark (NYSE: KMB) to Equal Weight from Underweight.
Optical bar codes are on most of the products we buy in stores these days, and there is a firm in Vernon Hills, Illinois, that is a leader in making the machines that create the codes. The same company also provides the machines that make the radio frequency labels that are replacing barcodes.
Zebra Technologies (NASDAQ: ZBRA) provides printers, supplies and software used to produce bar codes, text and graphics on labels, cards, receipts, tickets and tags. It also makes EPC-compatible radio frequency identification (RFID) smart label printers/encoders for firms required to comply with major retail and government mandates. The company's products are used by businesses and governments in 100 countries around the world, including ninety percent of the firms in the Fortune 500. Major clients include AMR Corporation (NYSE: AMR), Caterpillar (NYSE: CAT) and Kimberly-Clark (NYSE: KMB).
MOST NOTEWORTHY: The Personal Care, Household Products and Cosmetics industry, Horsehead Holdings and China Sunergy were today's noteworthy initiations:
CIBC started shares of Horsehead Holdings (NASDAQ: ZINC) with a Sector Outperformer rating and $30 target, as they believe the valuation discount to other North American zinc producers will narrow as investors become more aware of the name.
Jefferies would avoid shares of China Sunergy Co Ltd(NASDAQ: CSUN) in the near-term as the company resolves issues regarding its access to polysilicon. The firm initiated shares with a Hold rating and $8 target.
OTHER INITIATIONS:
Goldman reinstated LSI Corporation (NYSE: LSI) with a Neutral rating and $8 target.
CHK is the largest independent and third largest overall producer of natural gas in the U.S. Bloomberg reports Natural Gas Futures are up .88% to 5.63. CHK has a market cap of $15 billion with long-term debt of $8.3 billion. CHK announced on 8/8/07 a $500 million issuance of convertible senior notes (convertible debts increases volatility). CHK filed to sell EUR $525 million in senior notes on 11/27/06. CHK filed to sell $792 million in senior notes on 12/1/06. CHK filed to sell 30 million shares in a secondary on 12/7/06. CHK October option implied volatility of 33 was above its 26-week average of 28 according to Track Data, suggesting larger price risk.
1.3 billion people, nearly a quarter of the world's population, use KMB brands every day. KMB is recently down 98 cents to $68.42. KMB has a market cap of $29 billion with long term debt of $3 billion. KMB reported 2006 revenue of $16.7 billion. KMB has been frequently mentioned as an LBO candidate in 2006. KMB option implied volatility of 18 was near its 26-week average according to Track Data, suggesting non-directional risks.
Daily options update is provided by Stock Specialist Paul Foster of theflyonthewall.com.
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MOST NOTEWORTHY: Invesco, Kimberly Clark and Crawford & Company were today's noteworthy initiations:
This post is part of our 
Here are some highlights from this past week's 
Kimberly-Clark
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In sharp contrast to the ten horrifically downtrending stocks I warned against buying in 
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Chesapeake Energy Corporation
Oil hits record $127.43 on supply concerns, raised Goldman forecast
Icahn's 'shock and awe' on Yahoo -- a gutsy play
Housing starts surprisingly rise in April on apartment construction
