Thursday, August 17, 2006

Notablecalls - Paperstand

The CNET News reports that Dell (DELL) is expected to announce Thu that it's expanding its partnership with the AMD (AMD) to include with new AMD-based servers, desktops and laptops. Dell already scrapped its longtime Intel (INTC) exclusivity in May, committing to sell a 4-processor server with AMD's Opteron by the end of the year. That's a relatively high-end niche for the computer maker, but sources familiar with the co's plans expect a broader alliance to be announced Thu afternoon, when Dell reports quarterly results. One source expected Dell to announce plans to sell dual-processor Opteron servers, a segment of the mkt with much higher sales volumes than for 4-processor machines. Another expected the alliance to include desktop and notebook computers as well. In the server arena, a likely option is be a rack-mounted model 3.5 inches thick, a size that permits useful features such as moderate storage capacity and redundant power supplies.

The WSJ reports that RR Donnelley (RRD) is entertaining offers to be bought by leveraged buyout firms. The co, with a mkt cap of $7.4bn, is a logical tgt for these buyout shops, which seek co's with steady cash flows that can be used to pay down debt used to fund an acquisition. At least 2 buyout groups are considering offers. One group is comprised of Carlyle Group, Madison Dearborn Partners and Thomas H. Lee Partners. A second bidding group includes Blackstone Group and Texas Pacific Group.

Barron's Online highlights Nike (NKE), saying that hammered by the resignation of a CEO and soft sales in Europe and Japan that contributed to last quarter's disappointing financial results, Nike's stock has tumbled 15% since hitting a 52-w high in Dec. Certainly, Nike remains a respected name among consumers, and a marketing marvel to boot, thanks to big-name endorsements from the likes of Michael Jordan and Brazilian soccer star Ronaldinho as well as years of arresting television ads with the tag line, "Just Do It." Moreover, the stock certainly looks cheap. But the shares could continue to languish, however, amid tighter consumer spending, rising competition overseas from lower-cost products, and general anxiety over the state of the US athletic shoe mkt. "The stock doesn't seem to have a driver behind it," says David Heupel, manager of the Thrivent Large-Cap Growth Fund. "We don't see a lot of downside, but the stock will stay in the $80 range."

Barron's Online reports that Carl Icahn has once again taken a shine to shares of ImClone (IMCL), buying 1.5m shares for $46.3m after the biotech took a beating when it called off its search for a buyer. Icahn's purchases were made on Aug. 11, 14 and 15, and boosted his stake to 10.3m shares, or 12.3%. Ben Silverman, director of research at, said that Icahn's purchases is "indicative of him feeling that the stock is undervalued." The Aug. 11 filing said Icahn's representatives had been in talks with ImClone about its business and operations, and that ImClone had asked Icahn to be a director, which Icahn has not yet made a decision about. "I don't think there is hostility there if they invited him to join the board," says Silverman. Silverman adds that the aggressiveness of Icahn's most recent spate of buying is a "very positive sign for the stock right now."

Notablecalls: The NY Post started imaginary Hedge Fund few weeks ago. It's entertaining. Get todays comment here.

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