Among the biggest winners in Friday's early trading are
Top Percentage Gainers -- Friday, July 9,
Company Name (Ticker)
*Table includes companies with minimum market
capitalizations of $200 million and three month trading
volumes of at least 100,000 shares. All percentage returns
are listed as of 11:44AM Eastern Standard Time . Click on
ticker symbols for up-to-the-minute price quotes and
percentage gain data.
Shares of semiconductor test equipment maker
are rebounding +4.5% on Friday after the company issued a press
release Thursday evening refuting bearish comments from analysts at
Oppenheimer. Analysts had slashed their sales and profit forecasts
while cutting their target price from $13 to $10 after the company
lost out on a lucrative new contract with
Management did not directly address the analysts' assertions, but
instead simply noted that "the current business environment is
extremely healthy." Investors will need to wait until the August
5th conference call to find out what that really means.
Action to Take -->
Nanometrics' quarterly results have been very erratic, and
management may be signaling that the current quarter will be one of
the more robust ones. That does nothing to assuage Oppenheimer's
concerns that long-term growth rates may need to be tempered. As is
the case with many tech stocks right now, shares are quite cheap at
about eight times projected 2010 profits. The real catalyst for
this and other tech stocks is a lifting of fears that industry
sales are on the cusp of heading south. That may not happen until
investors come to believe that the global economy is on healthy
ScanSource's Bullish View
Investors that continually check the health of spending among small
and medium-sized businesses often eagerly await the end-of-quarter
sales announcement from
. The company distributes a range of small electronics such as
barcode systems, point-of-sale systems and telephone equipment to
companies that are too small to deal directly with manufacturers.
It's a hopeful sign for the economy that ScanSource just
pre-announced robust sales numbers. Sales will likely be around
$575 million, up from $441 million last year and above the $540
million consensus forecast -- a company record. The
pre-announcement is pushing shares up more than +5%. Although
ScanSource won't release full fiscal fourth quarter results until
August, per share profits are likely to be about +10% higher than
Action to Take -->
Shares of ScanSource have been in the $25 to $30 range for much of
the past five years, even as sales have risen +30% during that
time. The company is mostly focused on the North American market
and is insulated from international economic concerns, but it's too
soon call this bullish report a trend, as quarterly sales reports
have been quite erratic. ScanSource represents much more of a solid
long-term holding than a short-term trade.
Google looks to rebuild Lost Chinese Market
In the battle between the world's most promising new tech economy
and the world's hottest tech company, the company blinked.
is officially back in business in China after agreeing to alter how
users access its search service. The move is pushing shares up,
even as it garners jeers from human rights campaigners that had
hoped Google would stand firm with its anti-censorship stance.
The business-boosting move for Google is a clear negative for
Chinese search competitor
, which was able to almost completely dominate the market while
Google was inactive. Shares of Baidu are trading down -3% on Friday
but above levels seen when Google's market re-entry first hit the
It remains to be seen how much brand loyalty Baidu was able to
garner in Google's absence.
Action to Take -->
The move is unlikely to alter analysts' earnings forecasts for
Google, as China likely represents less than 2% of total sales. But
if the search giant is able to regain a foothold and also
eventually become a player in the PC software and mobile phone
markets in China through its Android platform, then China could
eventually come to represent a major growth driver. Only a quarter
of the Chinese population has Internet access, but the market could
triple in size to achieve penetration rates similar to those found
in Japan and Korea.
-- David Sterman
David Sterman has worked as an investment analyst for nearly two
decades. Most recently, he served as Managing Editor of
RealMoney.com, the premium website of TheStreet.com. David has made
numerous media appearances over the years, primarily on CNBC and
Bloomberg TV, and has a master's degree in management from Georgia
Tech. Read More...
Disclosure: Neither David Sterman nor StreetAuthority, LLC hold
positions in any securities mentioned in this article.
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