It’s Monday April 24, 2006, and the earnings parade continues but that is not the headline news for traders. The situation in Iran and the growing tensions have forced crude oil to hit all time highs trading over $75 a barrel on its way to $80, now this rise is dependent on the tension remaining in Iran and Nigeria, which does not show signs of letting up anytime soon, so $80 is realistic. On the metals front Gold traded over $635 on Friday making its way to $800, Silver is no slouch as it has traded as high as $13 on Friday making its way to $18 possibly $20, high grade Copper traded as high as $314 while Platinum went as high as $1140. One metal that I haven’t mentioned yet I will address this week along with a few ideas of companies that stand to benefit.
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China’ s President Hu Jintao continues his world tour as he has departed from the United States and heads to Saudi Arabia. This is part of both China’s desire to be a global player and the world’s concern about oil.
To avoid further bloodshed, Nepal’s King has agreed to do away with the one-man rule, this will appease both the protesters and global leaders.
The United States is now putting pressure on Russia to stop selling weapons to Iran until Tehran ceases their nuclear developments. This will add to the mounting tension and help crude oil trade higher as it looks at the $80 a barrel mark.
Now in Italy, Romano Prodi received his final congratulations call after getting the word from the courts that he was indeed victorious, the call came from President Bush. At this point Prime Minister Silvio Berlusconi has yet to concede, maybe he’ll make Prodi an offer that he can’t refuse.
Movers and Shakers
Some major movers in Friday’s trading session include Titanium Metals (NYSE: TIE) which traded up $6.72 to close at $63.96, First Republic Bank of San Fran (NYSE: FRC) which traded up $3.95 to close at $43.46, Pilgrims Pride (NYSE: PPC) which traded up $2.13 to close at $23.49.
Petroleum Geo Services (NYSE: PGS) made almost a 10 percent bump up, it traded up $5.14 to close at $56.90 but bear in mind that this was on very light volume, this is an example of a thinly traded security that can move up rapidly on little volume. Other companies include MRO Software (NASDAQ: MROI) which traded up close to 30 percent, it traded up $4.47 to close at $20.68, TravelZoo (NASDAQ: TZOO) had another roaring up day as it traded up $7.66 to close at $44.35, now TravelZoo on April 17, 2006 was trading in the $20 range and a short squeeze occurred because once they announced their earnings the stock shot up, so the coming weeks should be interesting for TZOO as the shorts may look for the stock to peak shortly. Housevalues (NASDAQ: SOLD) traded up almost 20 percent as it went up $1.45 to close at $9.45 on Friday.
Now three companies that we have featured on Wall Street to Main Street have just received analyst coverage from Lehman Brothers (NYSE: LEH), a stock by the way that should be in the $190 to $200 as mergers and acquisitions continue to rise, now back to the companies that they initiated coverage for, they include:
Weight Watchers (NYSE: WTW) they initiated it as Equal Weight, Herballife (NYSE: HLF) they initiated it as Overweight, Nutri Systems (NASDAQ: NTRI) they initiated it as Overwieght and Life Time Fitness (NYSE: LTM) they initiated it as Overweight. I thought it a pun was intended with the Overweight status for diet and exercise companies.
With crude oil on the move A.G. Edwards bumped up their target price on a few companies. They raised Occidental Petroleum (NYSE: OXY) to $118 from $100, we said that it would break their 52-week high recently and it did, $118 is attainable, but don’t get greedy, take some off the top if you start to see some weakness. Exxon Mobil (NYSE: XOM) was raised from $69 to $72, Marathon Oil (NYSE: MRO) was raised from $79 to $96 and BP PLC (NYSE: BP) was raised from $78 to 88.
CIBC World Markets upgraded International Game Technology (NYSE: IGT) from a Sector Underperformer to a Sector Performer. Now IGT had a nice run and pulled back temporarily and may present an opportunity as it creates a new trading range. That is some food for thought.
This is the first of our “Furious Five” companies that we see excelling in their industry in 2006. Our first addition to this week’s Furious Five is Neoware, Inc (NASDAQ: NWRE) it trades on the Nasdaq under the symbol NWRE. Included in this edition of Wall Street to Main Street is the business of the company and our outlook for the company, this is available to subscribers only..
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Wall Street Corner with Larry Oakley
Northgate Minerals Corp. (AMEX: NXG)
Because of my opinion that the price of gold will reach & exceed $1000/ounce, I am investigating a number of gold situations. Northgate Minerals Corp is one of them.
At the close Friday 4/21/2006, NXG was trading at $3.63, up $0.23 from Thursday. In after-hours trading Friday, it rose to $3.65. Its 52-week range is $0.92 – $3.72, & its average volume over the last three months was 2.795 million shares. In the Q ended 12/31/2005, its net income was $30,965,000 on total revenue of $257,153,000.
Also included in Larry Oakley;s commentary are other statistics and his outlook for the company.
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We cannot stress enough that investors need to do their due diligence, call the companies, get the information, consult with your investment advisor and if you do not have one consider getting one. Put the same time into investigating these companies as you do when you go to purchase a new television, it’s only for your protection. When it comes to thinly traded securities stagger your orders or put a limit order in to avoid a run up.
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