3 stocks: Flash and chips in, newspapers out
Sandisk and AMD have some news to move on, but Gannett is not a good story.
NEW YORK (FORTUNE) - Had a blast at the New York car show yesterday. If the automakers would only actually make all those cool concept cars, what a wonderful world it would be!
SANDISK: This guy is going in the S&P 500 to replace Chiron (which is being bought by Novartis.) Sandisk - outta Sunnyvale, CA - makes flash memory, which prevents info from getting lost when the power goes off. SNDK (Research) was founded in 1988 by one Eli Harari. Company sells its wares to Cannon, Ericsson, Kodak, etc. Stock has been a HUGE winner this decade, (from $4 to $59!) and is up bigtime this morning on the S&P news. I like this business and this company.
GANNETT: Earnings! Earnings! Read all about it (Research)! Not a pretty picture here though, particularly since this was long considered one of the strongest plays in the newspaper biz. Earnings fell 11% (that included a one time charge), but also ad revenue at company flagship USAToday fell. As one analyst put it, circulation is declining, ad revenue is declining, and margins are dropping. Bottom line? Wait until Craig's List goes public, if it does. (And it should!)
AMD: This company always scares me a little. Does it ever really come through? Since late 2002 it sure as hell has. Climbing almost TEN-FOLD to $35! And now earnings have just come out. Good news: Numbers beat the Street. Bad news: Weak guidance going forward, and the stock will be soft today. My take? AMD (Research) has been stealing market share from Intel with its dual-core server processor. Intel has a market value of $112 billion, AMD's is only $17 billion. I don't really like Intel (Research) at this point and AMD is expensive, but I think over time you could make out.
Loose Change: Stupidest government job ever (and this is a tall order!) My vote? How about the guy that "estimates" what the average price of gasoline will be in 2007. I mean puh-lease! He said $2.40 per gallon by the way ... down (of course) from $2.50 this year. Uh, right.
E-mail Andy Serwer at firstname.lastname@example.org
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