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earning

Weekend thoughts w/e 042608

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The future of food
I watched the movie (documentary) The Future of Food in the weekend, via the NetFlix “instance play” feature. This 2004 documentary is about the genetic engineered seeds, and its effect on farmers and our daily food. I remember a few years ago there was a lot talk about genetic modified food, and its resistence in Europe. The critism seems subsided recently due to the global food shortage. Agriculture chemical companies such as Monsanto (NYSE: MON), which is the top GM (genetic modified) seed maker in the world (also main subject in the film), are red hot on the Wall Street these days. The interesting thing for me, is how GM seed is changing the global agriculture industry, including many small family farms in developing countries, and at the same time, affecting our food safety and sustainability of farming.

Here is a 9 minutes introduction of the film on YouTube.

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earning

China Mobile, Syngenta update

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In last two days China Mobile (NYSE:CHL) and Syngenta (NYSE:SYT) released its Q1 results (Bloomberg: CHL result, SYT result). Both are doing very well lately. Today CHL got an upgrade from Zacks. But let’s not got too excited on the stocks, as a general rule. Also keep in mind sometimes we could use the analyst upgrade or downgrade as an opposite indicator (market sentiment).

Remember a company’s fundamental does not change before and after an analyst wrote a report.

China Mobile’s strength or new growth mainly comes from the rural areas, and data/internet plan in urban areas. While I apploud its management’s forward looking strategy, I am not sure how long this momentum can sustain. Note CHL trades at a much higher price compared to other mobile operators, and it is the No. 1 carrier in the world according to market cap. Here is another interesting Chinese article about China Mobile (from Caijing).

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earning

Weekend thoughts w/e Apr 19 2008

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Currency effects
While we are heading to $4 gas (partly thanks the weak dollar), not all are victims of this trend. Think Google or IBM. Google (GOOG) and IBM reported blow out earning, while cell phone maker Nokia (NOK) reported so-so earning (or outlook) last week. One key difference is the reported currency, Google and IBM reported results in USD, while NOK reported in Euro. We all know Dollar lost a lot ground to Euro in past year, since GOOG and IBM did a lot business in Europe (and internationally), their earning and earning growth is exaggerated by the depreciation of dollar. Nokia is hit by the opposite force. A more important question to ask is: can the dollar continue to slide vs. other currencies? Personally I would not bet on GOOG or IBM if their growth is mostly from the currency effect

ICBC, Goldman Sachs, China Invest Co. and Blackstone

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earning

Second shoe dropped at CROX

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To be fair, Crocs reported a good quarter for Q4 2007. But, the outlook did not please the street, let me quote Reuters:

The company based in Niwot, Colorado, whose vibrantly colored shoes, clogs and boots have become a fad in recent years, also backed its 2008 profit outlook of $2.70 and revenue view of $1.16 billion.

Analysts were expecting a profit of $2.72, before items, on revenue of $1.16 billion.

The stock dropped about 10% after hour. I am not sure if it will recover like AMZN did after its earning couple weeks ago. As I was listening the Conferece call, one analyst asked if people under-appreciated Crocs’ infrustructure, he even said Crocs is like a global supply chain company happens to make and distribute shoes. Interesting point, Crocs has 5,000 employee worldwide as of now.

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earning

Things to look for Crocs earning Feb 19

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Crocs scheduled the Q4 2007 earning report on Feb 19. Couple things I anticipated and will pay attention to:

1) I don’t think this will be a strong quarter due to seasonality: it’s winter in Europe and Japan, and in winter they don’t wear Crocs as the American do.

2) Inventory: if the 1) holds, the inventory (classics and Cayman) they built up last quarter will not reduce dramatically. The managment also said in last CC they expect those inventories to ship for Spring 08. This is not good news.

3) Cash flow: they will not have cash flow statement in press release; they will have it in the 10-Q, 10-K afterwards. But don’t expect too much from it. As I said in my earlier post titled “stock option helped Crocs cash flow”, this magic will not work any more now that the stock is beated down.