Trefis Week in Review

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The Week in Review

Below is a summary of the activity on Trefis during the past week that we thought you would find interesting.

Insights from the Week

Technology Media & Telecom

Pandora's Music Genome Project allows users to personalize their playlists based on preset choices and feedback. On the other hand, Facebook will allow Spotify to become more social …

Google's earlier social networking efforts Orkut, Buzz and Wave were all created to penetrate the booming social networking market, but these efforts failed to take off …

While Intel is the king of PC chips, the mobile market is much more competitive and since Apple has designed its own chips for the iPad, we don't see Intel getting a piece of this market anytime soon …

  • NetApp Eyes $85 if it Hangs on to Software Market Share on June 30, 2011

NetApp performance in the external disk storage systems market was top notch as the firm expanded its share to 13.5%, up from 11.1% last year, and held on to its second place in the market behind EMC …

  • IBM's Upside & Downside Scenarios to $185 Value on June 30, 2011

There could be 6% upside to the Trefis price estimate if middleware software license revenues were to increase at a more rapid rate than we currently forecast to over $12 billion by the end of the Trefis forecast period …

  • What Zynga Followers Should Know Pre-IPO Filing on June 29, 2011

As Zynga user base becomes more international, the average revenue per user may fall as many international regions have lower monetization rates …

  • How to Justify a $15-20 Billion Valution for Zynga on June 29, 2011

If Zynga's current or long-term operating margins are closer to those of Electronic Arts and Activision Blizzard around 10%, then the rumored valuation is far too lofty …

  • Google's New Search Features Help it Defend $576 Value on June 29, 2011

Google has introduced quite a few innovative products in the market over the past year, which includes Google Instant. The recent announcement brings voice search on desktops, which was earlier available on mobile phones …

  • Nokia Worth $9 Though N9 Will Add Little on June 29, 2011

Apple and Android-based phones continue to surge ahead of the pack and N9 is not likely to provide any support to Nokia's market share. Although N9 will have attractive features, it will likely be sold for unsubsidized price point …

  • New Smartphones to Help Motorola Reach $25 on June 29, 2011

Motorola Mobility earns higher margins on smartphones, which could help SG&A and R&D expenses as % of gross profits could decline in the future …

  • Priceline's New Alerts Help Bargain Hunters Stay Atop Deals on June 29, 2011

This seemingly insignificant e-mail alert feature however hints at how online travel agencies are willing to adapt their systems and business models from simply offering the so-called 'best deal' to customizing offers …

  • How to Justify Pandora's Valuation at $17 on June 29, 2011

If total registered Pandora users continue growing at the same pace as in 2011 Q1, it can reach 130 million by the end of the year …

  • Expedia Partners with AirTran Airways, Extending its Affiliate Network on June 28, 2011

If Expedia could secure more of these partnerships and the market share for occupied hotel nights rose to around 3% by the end of our forecast period, this would result in 12-15% upside …

  • HP Eyes Big Opportunity in Catering to Small Businesses on June 28, 2011

According to HP's estimates, SMBs facing challenges like controlling costs, managing employee productivity and gaining access to credit, represent an estimated $234 billion in total addressable market …

  • What Dell Could Gain by Acquiring Brocade on June 28, 2011

If Dell is able to push its server sales as a result of the acquisition, it will make the servers & networking business segment more valuable than the PC business (notebooks, netbooks & desktops combined) for Dell …

  • AT&T's New CDN Offering, Strategic but Insignificant for Stock on June 28, 2011

While half of the company's value is associated with these services, only about 11% comes from business services. Therefore, while the move may be strategic, its value creation potential is limited for now …

  • IDC Sees Android & Windows 7 Taking Smartphone Market Share on June 28, 2011

IDC expects iPhone sales to show an average growth rate of 18% through 2011 to 2015 compared to an overall smartphone market growth of 20% during the same period …

  • Microsoft Wants to Tap Cloud Computing Growth with Office 365 on June 28, 2011

Through Office 365, Microsoft is not only looking at cementing its position in productivity software market, but also ride on the faster growth expected out of cloud-computing market …

  • Can AMD's Supercomputing Gains Signal Upside in Server Market Share? on June 27, 2011

Although AMD has experienced growth in the past 6 months, a number of AMD-based supercomputers in the top-500 have declined since 2006 …

  • Oracle's Database Business Munches IBM's Market Share on June 27, 2011

As per Oracle's fiscal year Q4 2011 earnings release, its database software business grew 28% in this quarter compared to the same quarter last year, which is outpacing competitors by a healthy margin …

  • VMware Announces vFabric 5 to Target Enterprise Market on June 27, 2011

In 2010, IBM generated nearly $25 billion in revenues through its middleware software offerings, which gives an idea of the size of the opportunity for VMware if it can penetrate this market …

  • Oracle Hardware Growth Will Come, Focusing on Profitability First on June 27, 2011

We believe the market may be over-reacting to the concerns of Oracle's hardware business slowdown, and we as the outlook for Oracle's hardware business remains robust …

  • Online Advertising Sector Review - Google, AOL & Yahoo on June 27, 2011

Google's stock touched nine month low last week after an investment bank report suggested search advertising growth might be slower than expected …

  • Mobile Phone Sector Notes - RIM, Apple and Nokia on June 27, 2011

Bloomberg created a stir by coming up with a report that Apple is expected to come up with a new version of iPhone in September …

 

(Trefis Pro Exclusive) Consumer, Retail, & Automotive

  • Africa Next on Gap's International Push on July 1, 2011

The move to expand in the African countries comes following the announcements by Gap Chairman and CEO, Glenn Murphy, to bring the company back on track …

  • Toyota Goes Small to Make it Big in India on July 1, 2011

The growth rate for passenger car sales dropped to 7% in May 2011 due to increasing interest rates, fuel price hikes, inflation and commodity price rise; however, most market participants consider these factors temporary …

  • Lower Fuel Prices Help Retail Stock Though Abercrombie Isn't Cheap on June 30, 2011

Easing oil prices, apart from triggering sales, will also help these companies gain back some lost operating margins on the account of high cotton and oil prices.

  • ANF Bets on International Growth with Hollister on June 28, 2011

Though the company is expecting Q2 to be a little weaker, Hollister's revenues this year itself may cover up for most of the company's $350 million capital expenditure for opening 40 Hollister Stores …

 

(Trefis Pro Exclusive) Financial Services

  • RBS Dutifully Sheds Assets as Stock Heads to $13.50 on June 30, 2011

RBS has been working hard to clean-up its balance sheet since the company had to resort to the government's help to survive the global financial crisis of 2008 …

  • Discover Needs 10% Haircut Though Declining Loan Losses Lift Profits on June 30, 2011

Though a moderate increase in both card sales volume and total loans supported the increase, a 76% decline in provision for loan losses helped the company report its all time record quarterly net income …

  • JPMorgan Headed to $45 as it Expands Prime Brokerage Abroad on June 29, 2011

The prime brokerage industry generated $10 billion in revenues in 2010 and is poised to grow significantly this year with 254 new hedge funds starting operations in the first quarter alone …

  • Goldman Sachs Expands Investment Banking Capabilities in Brazil on June 29, 2011

Brazil has posted impressive growth in agriculture, mining, manufacturing and service sectors to become one of the fastest growing economies in the world …

  • MetLife Eyes Reverse Mortgage Market as Giants Exit on June 29, 2011

MetLife's aggressive venture into the reverse mortgage market would help it increase its mortgage revenues from $4.2 billion in 2010 to nearly $4.5 billion by 2017 …

  • UBS & CS Shares Vulnerable to Greek Debt Shenanigans on June 29, 2011

Despite the lower liability of Swiss lenders, possible write-downs resulting from a default could hamper the capital structure of these banks …

  • CS Announces Systematic Trading Group for Asset Management Division on June 28, 2011

This will provide clients risk-adjusted returns that will have low correlation with major markets. The group will focus on transparency and has a pre-defined risk management and governance structure already in place …

  • Fed Consumer Credit Report Lifts Discover's Prospects on June 27, 2011

An increase in the demand for student loans will help Discover improve its student and personal loan portfolio which stood at $4.3 billion in 2010 …

  • MetLife Partners with Citi in Card Insurance Market on June 27, 2011

The growth in the number of credit cards in circulation presents a huge market opportunity for credit card insurance. The Center for Economic Justice estimates that credit card insurance generates over $2 billion in revenue each year …

  • Banking and Retail Weekly - Citi, JPM, Barclays, CS & Home Depot on June 26, 2011

To meet the target Barclays expects retail and business banking to rake in $3.2 billion of additional revenues and the corporate and wealth management divisions to contribute an additional $1.6 billion in revenues each …

(Trefis Pro Exclusive) Energy & Natural Resources

  • International Markets Make up 2/3 of First Solar $144 Value on July 1, 2011

It's interesting to note that Germany's total installed solar PV panels capacity of 12.1 GW is greater than Japan's six nuclear reactors of 10 GW capacity …

  • LDK Solar Gets a Hand from Chinese Government on July 1, 2011

A possible reason for the pessimism over LDK is the recent postponement of LDK Solar's debt offering, which was originally planned to pay down the company's short term debts …

  • First Solar Can Hit $144 With Rock Bottom Production Costs on July 1, 2011

Based on data provided in the company's annual reports, the average manufacturing cost per watt for First Solar modules has declined steadily from $1.47 in 2005 to $0.75 in 2010 …

  • Chesapeake Shakes Off Fracking Concerns Headed to $35 on July 1, 2011

The New York Times claimed that it researched the well data and reached the conclusion that some of the wells operating in less-productive zones may prove too expensive …

  • Mining Moly Chips in to Freeport's $59 Stock Value on July 1, 2011

According to the company's annual report for 2010, it sold 67 million tons of molybdenum last year and had more than 3 billion tons of proven reserves of the metal at the end of 2010 …

  • Mining Expansion Lifts Cliffs Outlook on June 30, 2011

Cliffs clearly has its vision set to draw the maximum possible value out of the Bloom Lake iron-ore mines it recently added to its North American operations with the acquisition of Consolidated Thompson …

  • Upside & Downside Scenarios for BP's $54 Value on June 30, 2011

If there is a 6% annual growth in oil prices, then BP's realized price per barrel would cross $110 by the end of the same period - representing a 7% upside to the Trefis price estimate …

  • First Solar to $144 if Local Ca. Governments Stay Away on June 30, 2011

First Solar has already had to face the brunt of the local government in the region charging commercial and utility projects exorbitantly high figures for inspecting newly installed solar arrays …

  • Alcoa Could Reach $20 with Help from New Alloys on June 29, 2011

Alcoa claims that an aircraft made with the new alloy would be about 10% lighter and would improve fuel efficiency by as much as 12% …

  • Suntech's Improving Production Costs Support Outlook on June 28, 2011

Suntech Power continues to enjoy the advantages of the Chinese government's incentives to local solar industry companies and benefits considerably from the lower cost of labor in the country …

  • Liquidity Concerns Rise Over US Steel on June 28, 2011

With the global economy recovering and US Steel demand recovering from the slump, steel prices are expected to continue their upward trend for the remainder of 2011 …

  • Dow Chemicals Benefits from Obama's Manufacturing Push on June 28, 2011

As part of the AMP, Dow will develop solar, battery and agricultural products and will also build new propylene and ethylene plants in Texas …

  • 3 Key Sources of Value for LDK Solar's Stock on June 27, 2011

The China Wafers division represents the company's sale of solar wafers in mainland China. The solar wafers are sold to makers of PV cells, PV modules and PV panels …

(Trefis Pro Exclusive) Industrials & Transportation

  • Framo's Deepwater Prowess Fuels Schlumberger to $105 on July 1, 2011

Improving hydrocarbon recovery has been a focus area at Framo's home country of Norway, after crude oil production in the country fell by almost 50% after a 11 years of decline …

  • Schlumberger Learns Russian as Drilling Demand Takes Stock to $105 on June 30, 2011

Russia holds the world's largest reserves of natural gas and the 8th largest reserves of oil, and local production giants such as Gazprom and Lukoil have already announced aggressive plans to boost reserves and production …

  • Southwest Airlines Flies to $14 Unless Hedging Losses Eat Profits on June 29, 2011

Hedging merely allows an airline to estimate with some certainty the actual fuel cost, which makes up almost a third of the overall operating expenses for most airlines …

  • Key Growth Drivers for Boeing on June 28, 2011

We expect the company's DSS division to be subjected to higher risk, as any cost over-runs would directly impact margins under a fixed-price contract …

  • FedEx Coverage Launch: $115 Trefis Price Estimate on June 28, 2011

By introducing the 777, FedEx Express can take market share from competitors by increasing FedEx Express Package total volume and FedEx Express Freight total freight pounds …

  • Halliburton at Risk if Shale Economics Fall Short on June 28, 2011

While some participants voiced concern over the hype surrounding the industry, others go as far as comparing the accounting and forecasting practices in the industry with those that led to the demise of Enron …

  • Transocean Blames BP, Not Chipping in for Gulf Clean Up on June 27, 2011

Transocean's report states that BP used a poor well design, and did not assess the risks associated with the well properly - which led to the accident …

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Investing Ideas , Stocks , US Markets

Referenced Stocks: AAPL , AMD , F

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