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- snaimon
- mdorsey
- mdorsey
- ACousins
- 2win
- Rande
- lcha
- JenL_2
- JenL_2
- JenL_2
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» mdorsey - Advice?
WEISS COMMENTSEarnings Still Have Further To Fall
-- October 10, 2001
It's no surprise to us that analysts are revising, once again, their estimates for corporate profits. Quarter after quarter, these analysts have revised their estimates downward. And, then, the closer it gets to earnings season, the further they slash their estimates.
We're willing to bet that first-quarter 2002 earnings will drop even more than 0.2% the analysts predict, even factoring in the huge drops expected in the third and fourth quarters of 2001. That's because there's no sign that the economy is staging a turnaround. In fact, things have gotten much worse in the last month. Consumer confidence has plunged … layoffs have skyrocketed … retail sales growth was the smallest in at least three decades. It appears we are in the beginning stages of a recession, and if things don't improve soon, we may find ourselves in the midst of a depression.
Because of the current market rally, investors seem optimistic that we've seen the bottom. But beware: We haven't. The bottom will come only when most investors have lost any faith that the market will rebound. We'll have to wait and see if we reach that bottom after the next few quarters of dismal earnings reports. For now, take this opportunity to sell any stocks you've got left.
-- posted by mdorsey
» 2win - mutual fund w/defense stocks
There are quite a few funds with positions in defense stocks, but the closest you'll get to a "pure play" is the Fidelity Select Defense and Aerospace fund (FSDAX), one of a number of Fidelity “Select” funds that invest in specific sectors of the economy.http://www.maxfunds.com/content/am92401....
Dave J.
-- posted by 2win
» JenL_2 - Re: Lumber & Paper Mergers
More on Lumber & Paper Stocks from 10/11 biz.yahoo.com:Willamette Would Talk with Weyerhaeuser
By Arindam Nag
Timber and paper company Willamette Industries Inc. (NYSE:WLL) said on Thursday it was willing to discuss its takeover by Weyerhaeuser Co. (NYSE:WY) if Weyerhaeuser was willing to make a written offer in the high $50s a share.
This is the first time that Willamette has spelled out at what price levels it would be willing to negotiate a takeover by Weyerhaeuser.
``To offer a path forward, if you make a written offer in the high $50s, we will agree to sit down for discussions regarding a possible combination of our two companies,'' Willamette chairman William Swindells and Chief Executive Duane McDougall wrote in a letter to Steven Rogel, Chairman and Chief Executive of Weyerhaeuser.
Weyerhaeuser responded that it was not willing to adhere to the condition of agreeing to a raised offer before starting discussions.
``We are not going to increase our price, however, merely to begin discussions that, based on your letter, would not be productive,'' Rogel wrote to Swindells and McDougall.
Willamette also said that if Weyeraeuser was not willing to pay the appropriate price it would look at other strategic alternatives including combining with another company.
The asking price level is up to 20 percent more than the $50 per share offered by Weyerhaeuser in an revised offer made last May. At $50 per share Willamette is valued at $5.5 billion.
Willamette said it was also giving Weyerhaeuser a deadline of Oct. 16 by which it expects the bidder to submit a revised written offer.
``If we do not receive your written offer by 5:00 PM PDT (Pacific Daylight Time) Tuesday, October 16th, we will assume you do not wish to proceed. In that event, we would urge Weyerhaeuser to withdraw its inadequate offer and cease the hostile attack on Willamette,'' the letter said.
Willamette shares closed 65 cents up at $45.65 on the New York Stock Exchange on Thursday while Weyerhaeuser shares closed $1.33 up at $51.59.
Thursday's developments come barely a month after a large shareholder's estate in Willamette said that both parties should thrash out a deal at $55 per share.
Richard J. Clark, son of long-time Willamette board member Maurice Clark told both companies he was prepared to tender the 7.39 percent stake in the company held by his deceased father's estate at that price.
Willamette said that despite the current sluggishness in the global paper and packaging industry, it believed that its value was in the ``$60s'' per share. But it said that, ``to offer a path forward, if you make a written offer in the high $50s, we will agree to sit down for discussions regarding a possible combination of our two companies.''
Willamette argued that Weyerhaeuser could afford a higher price as on a conservative level the combination would yield benefits of up to $645 million. This figure came out of calculations made by Weyerhaeuser's financial advisers Morgan Stanley in 1998 which also estimated an extra increase in shareholder value of $1.1 billion.
But analysts have said that the dynamics of the industry have changed with the outlook for the global paper industry eroding drastically in the last 12 to 18 months.
The S&P Paper and Forest Index has fallen from over 1,602.43 a year ago to below 1,200.
If Weyerhaeuser is unwilling to pay a satisfactory price then Weyerhaeuser would continue to pursue other alternatives to deliver shareholder value and that also includes a possible link-up with another company.
``If Weyerhaeuser is unwilling to pay what this company is worth, we will continue to pursue our strategic plan, which may include a significant business combination, recapitalization or other strategic or financial alternatives,'' Willamette's letter said.
Oregon-based Willamette has been trying to fend off hostile takeover advances from Weyerhaeuser since last November, when the timber company first offered to buy Willamette for $48 per share.
Sources familiar with the situation said that Morgan Stanley and Willamette's advisers Goldman Sachs were trying to work out a solution until late on Thursday afternoon in order to bring both parties to the table but Willamette made its letter public after Weyerhaeuser refused to agree to a price hike before sitting to talk.
<img src="http://chart.bigcharts.com/industry/bigc... WLL&comp=AAAAA:0&rand=8575" width=527 height=316>
Forest Products & Paper Index (FRP), WLL, WY, S&P500 1 YR Chart
......Jen
-- posted by JenL_2
» JenL_2 - Re: Lumber & Paper Mergers
More on WY-WLL hostile takeover from 10/12 The Seattle Times:Willamette opens door, then slams it on rival Weyerhaeuser
.....Jen
-- posted by JenL_2
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