If You Bought Humana On The Earnings, Consider This…

July 28, 2003
Vincent Mao

Stocks are
mixed this midday. After Friday’s rally,
stocks started the day on a positive note, but are currently mixed. Both the Dow
and S&P are slightly in the red while the Nasdaq is holding onto slight gains
thanks in part to strength in biotech, telecom, and semiconductor issues. The
Dow got within 49 points of its June 17 high of 9352.77 while the S&P backed off
after resistance at the 1,000 level. Losses in the Dow were offset by upgrades
on AT&T
(
T |
Quote |
Chart |
News |
PowerRating) and Walt Disney
(
DIS |
Quote |
Chart |
News |
PowerRating). CSFB raised Ma Bell’s rating from
"neutral" to "outperform" based on valuation and the company’s cost cutting
efforts. Soundview upgraded Walt Disney from "neutral" to "outperform".
Soundview based the upgrade on the company’s increasing margins in its broadcast
as well as stabilization in the company’s theme park business. Bonds are again
lower in anticipation that the government will announce record treasury sales in
order to finance the growing budget deficit.

No economic news today, but
tomorrow we will have Consumer Confidence for July.

The 10-year U.S. Note
is -230 at 112 150.

The dollar is +0.04 at
95.16.

Gold is +1.50 at 364.30.

Crude Oil -0.34 at
29.83.

Volume is 663,000,000 on
the NYSE, and 833,000,000 on the Nasdaq.

Market breadth is mixed,
with NYSE declining issues over advancing issues by a 1.07, and up volume over
down volume by 1.07. Nasdaq advancing issues over declining issues at 1.50, and
down volume over up volume at 1.51.

Top Dow stock(s) are:

Stocks in the news:

Chemical producer Air
Products and Chemicals
(
APD |
Quote |
Chart |
News |
PowerRating) is lower by a little over 1% after the
company reported third-quarter results that missed estimates by a penny.
Including a $96.6 million restructuring charge, the company earned 12 cents a
share compared to 63 cents during the same period a year ago.

Health insurance and services
company Humana
(
HUM |
Quote |
Chart |
News |
PowerRating) is trading higher by 4.5% after the company
reported better-than-expected second-quarter results and raised full year
guidance. Excluding one-time items, the company earned 37 cents a share compared
to 27 cents in the year-ago period. The company beat consensus estimates by 8
cents. Looking ahead Humana now sees full year results between $1.44 and $1.47
compared to estimates of $1.40. Despite hitting a new 52-week high today, there
is negative divergence in momentum as well as stochastics.

Biotech research firm
Invitrogen
(
IVGN |
Quote |
Chart |
News |
PowerRating) is trading lower by 3.5% after the company announced
a convertible note offering. The company is planning to offer $300 million in
convertible notes due in 2023. The notes will only be available to qualified
institutional investors. Invitrogen plans to use the proceeds for general
business purposes and for reduction of outstanding debt.

Shares of ITT Industries
(
ITT |
Quote |
Chart |
News |
PowerRating) are off by more than 1.6% despite reporting better-than-expected
second-quarter results and raising full year guidance. In its latest quarter,
the company reported adjusted earnings of $1.06 a share compared to 99 cents in
the year ago period. ITT bested consensus estimates by 4 cents. The company also
sees full year results coming in between $3.77 to $3.97 compared to analysts’
estimates of $3.86.

Aerospace and Defense giant
Northrop Grumman
(
NOC |
Quote |
Chart |
News |
PowerRating) is trading by more than 5% after the company
reported better-than-expected earnings and raised guidance. For the second
quarter the company earned $1.09 a share compared to last year’s $1.52. However
the results beat estimates by 23 cents. Looking ahead the company sees full year
results coming in between $4 to $4.25 up from its previous forecast of $3.80 to
$4.20.

Hospital operator Triad
Hospital
(
TRI |
Quote |
Chart |
News |
PowerRating) is higher by 10% after the company reported
second-quarter results that topped estimates by 2 cents. The company earned 51
cents a share compared to 44 cents a share in the latest quarter.

Retail giant Wal-Mart
(
WMT |
Quote |
Chart |
News |
PowerRating)
is fractionally lower despite announcing that July sales are at the high end of
its 2% to 4% estimate. The company cited strong sales of seasonal goods.

If you have any comments or questions, please
feel free to email me.

Vincent Mao

vincentm@tradingmarkets.com

If You Bought Humana On The Earnings, Consider This…

BUY THE FEAR, SELL THE GREED

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