ESPN, and largely the cable networks section of DIS, suffered a slight decrease in income as a result of higher programming and production costs, but other sections of cable networks made up for the sporting slack. In the broadcasting section, higher advertising revenues were offset by an increase in primetime network programming costs.

The most iconic part of DIS is arguably the parks and resorts section of the business. Revenues and operating income both increased 7% and 4% respectively for the quarter. According to the release, higher guest spending in domestic operations was offset by lower international operations.

DIS seems to be the king of brand recognition. Robert Iger, DIS CEO, puts it plainly in their latest quarterly release. “Our ongoing success is driven by our long-term strategy, the strength in our brands and businesses, and our high quality family entertainment.” This is evident by the continued investment in iconic brands; like the recently announced Star Wars movies.

The technical prospective is mixed. The 50 DMA is about to cross above the 100 DMA, but today’s candle may turn out to be a reversal bar and gap fill lower.

The analyst community has shifted their ratings around this morning too. CS (Credit Suisse) maintained an outperform rating, but raised their price target (PT) to $61 or about 11% from current prices. Nomura also kept their buy rating on shares and followed suit in raising their PT, but to $62.

salerno.mark.a@gmail.com

Paper bought 1000 NBG Feb 2 Puts for $.50 (2.3 times usual volume) when stock was trading $1.55
Paper bought 21,298 XLU March 35 Puts for $.15 when stock was trading $36.61
Paper bought 980 SN Feb 20 Puts for $.75 (2.6 times usual volume) when stock was trading $20.01
Paper bought 10,000 ALU Feb 1.5 Puts for $.05 (2.2 times usual volume) when stock was tradig $1.73
Paper bought 700 DLPH March 37.5 Puts for $.60 when stock was trading $39.17

Paper bought 2194 THOR March 40 Calls for $.75 (22.9 times usual volume) when stock was trading $36.90
Paper bought 700 NYT Feb 9 Calls for $.09 (6.9 times usual volume) when stock was trading $8.18
Paper bought 800 CXO March 95 Calls for $1.90 (2.3 times usual volume) when stock was trading $90.20
Paper bought 2740 ETP Sep 50 Calls (2.6 times usual volume) when stock was trading $45.67
Paper bought 3600 BRE April 50 Calls for $.725 (9.2 times usual volume) when stock was trading $47.62

Paper bought 1000 GOOG Jan 2014 800-900 Bull Call Spread for $23.50 when stock was trading $768.19
Paper bought 8000 ECA Feb 19 Calls for $.45 (6.0 times usual volume) when stock was trading $19.02
Paper bought 26,015 EA March 17 Calls for $.44 (7.4 times usual volume) when stock was trading $16.38
Paper bought ELLI July 20 Calls for $3.30 (3.7 times usual volume) when stock was trading $19.02
Paper sold FTK June 15 Calls and Bought FTK March 15 Calls for $.55 credit when stock was trading $13.97

It seems as though insiders and those familiar with the matter have had reality show like loose lips, for the market seemed to be expecting a deal.  The current discount however represents a plethora of risks to the situation. Many sources are disappointed with the proposed price, so their vote could be a risk.

The upside includes the potential for the go-shop period to play out. The go-shop process provides an opportunity to determine if there are alternatives offers superior to the one presented from Mr. Dell and Silver Lake for the firm out there. This period of time is 45 days. 

The transaction is valued at approximately $24 B. $13.65 represents a premium of 25 percent over Dell’s closing share price of $10.88 on Jan. 11, 2013, the last trading day before rumors of a possible going-private transaction were first released; a premium of approximately 35 percent over Dell’s enterprise value as of Jan. 11, 2013.

Mr. Dell, who owns approximately 14 percent of Dell’s common shares, will continue to lead the company as Chairman and Chief Executive Officer.

salerno.mark.a@gmail.com

Panera bread is scheduled to report fourth quarter earnings today after the market close.

Technically the stock has seen growth over the years, especially since September of 2012. Over the past year, the company has seen an average growth of 17.1% and has reported increasing profit for the last three quarters. Panera is expected to report revenues for the year at 2.13 billion. Analysts are projecting a profit in earnings at $1.72 per share, a rise from last year at $1.42 per share. Options are pricing in for a move at 6.25%, up from the last two quarters. The majority of analysts are reporting Panera as a buy, comparing favorably to its competition. 

Analysts estimate that Chipotle will report earnings of $1.97 a share and revenue of $698.87 million. That estimate would show a $0.16 increase year-over-year in Chipotles earnings per share, which was reported at $1.81 in the previous year’s fourth quarter.Chipotle has reported earnings per share that have beat analyst’s estimates five out of the last eight quarters. Estimates are down from Chipotles preliminary estimates released January 15, which predicted earnings between $1.92-$1.97 and revenue of $699.2 million. In the previous quarter CMG missed analysts’ forecasts of $2.30 per share, only reporting earnings of $2.27. CMG is estimated to have grown sales by 17.10% during 2012. During the fourth quarter Chipotle is expected to have grown by 8.30% compared to the S&P 500, which is expected to have grown 9.50%. Chipotle has been developing new strategies to attract more customers, announcing in January that it was testing vegetarian menu items known as “Sofritas”. Chipotle has also been testing a new catering venture, which Chipotle said will be available in all the markets it serves. The company is expected to have grown 28.60% this year compared to the estimated industry growth of 36.00%. Shares of CMG are currently trading at $310.19, which is up around 22.86% from the last earnings announcement. Chipotle’s Q4 report will likely fall in line with analysts’ estimates, however that may still come as a disappointment to investors if there is no significant growth realized.

Author: Tyler Sciortino

Contact for questions or inquiries at tsciortino312@aol.com

Technicals look sick right now and internals are confirming this down move in the S&P 500.

When looking at the technicals on the 30-minute chart, the MACD and RSI are showing extreme exhaustion…it’s a point where we could see one more push up but the downside looks like the most probable scenario. Also today there was a bearish cross on the daily MACD, again, it could push back up for a quick squeeze…but not likely.

My current count on this market (Elliot wave analysis) has us already completed the end of wave 5 of (3) on February 1st. After a completed five waves, we need to look for a corrective move (counter-trend)…. and we may have already started that move. Today, it looked like we completed five waves down, completing wave 1 of (4). This leaves us with a wave 2 bounce before the biggest drop in a wave 3 of (5). If this count is to follow through, we will be seeing this correction end near the 1460 level. A hard break of 1490 should confirm that this correction is in full force…

Internals are currently confirming this markets downward move. EEM (Emerging Markets), XLF (Financials), XLK (Technology), XLE (Energy), XLB (Materials) and DJT (Dow Jones Transportation Average) all had big down days today, and have struggled in the past week to hold up the S&P’s upward push. In the past this is a tell-tell sign that something is developing in the market and it wants to show a different face. All of these have bearish crosses on the daily MACD, besides XLE… is that a bearish sign or bullish?! To me that’s bearish, I don’t see how we are going to push up past 1525+ without all of these sectors joining the party. A 20-35 point pullback would be healthy for this market, to help unwind these indicators to push up through 1525+ with force and strength.

Author: Peter Nitso

Twitter: @PeterNitso

Email: pnitso@yahoo.com