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Technical Trade Alerts on Market Movers: BMC, DOW, MRK, GOOG, AMGN, STRA for March 17

Today’s Trade Alerts include: BMC Software Inc. (NYSE: BMC), Dow Chemical (NYSE: DOW), Merck Co. Inc. (NYSE: MRK), Google Inc. (Nasdaq: GOOG), Amgen Inc. (Nasdaq: AMGN) and Strayer Education Inc. (Nasdaq: STRA).

BMC Software Inc. (BMC) Trade Alert – Cisco, BMC Collaborate to Deliver Major Breakthrough in Management for Unified Computing System

BMC Software Inc. (BMC) shares slipped .03% in today’s early trading session, moving to $28.97. BMC Software develops software that provides system and service management solutions primarily for large enterprises in the United States and internationally.

Networking giant Cisco recently unveiled a major data center initiative featuring partnerships with other tech players, including BMC Software.

Cisco’s Unified Computing Systems, designed to incorporate computing, storage and virtualization technologies, combines with BMC’s Business Service Management. Cisco said the new data center architecture would help cut costs and help simplify the way corporate computer networks are set up and operated.

According to a press release, the Cisco Unified Computing System Manager offers a deep integration with BMC Bladelogic Service Automation and BMC Atrium Configuration Management Database (CMDB). This combined solution helps enable customers to define fully configured, customized service profiles with fully provisioned application environments, and then deploy them rapidly to meet their business or computing requirements.

According to Prem Jain, senior vice president of Cisco’s Server and Access Virtualization Business Unit, the Unified Computing System represents a complete paradigm shift in terms of what it costs to acquire, manage and administer IT environment of the future.

“Working closely with Cisco, BMC Software has delivered the very important pieces of software that make the Unified Computing System revolution real,” said Jain.

Jim Grant, BMC’s senior vice president for strategy and corporate development, said BMC and Cisco have eliminated the limitation presented by the inflexible architectures of the past.

BMC Software’s portfolio of software solutions spans enterprise systems, applications, databases and information technology (IT) process management. BMC Software also provides maintenance and support for its products and performs software implementation, integration and education services for its customers.

The company is organized into two software business segments: Enterprise Service Management (ESM) and Mainframe Service Management (MSM).

It serves manufacturers, telecommunications companies, financial service providers, educational institutions, retailers, distributors, hospitals, service providers, government agencies and channel partners through sales force, resellers, distributors and systems integrators. The company is headquartered in Houston, Texas.

In its recent chart, BMC’s MACD currently reflects weak bearish signal, with the indicator above the critical level of 0 but has crossed below its 9-day signal line, indicating that positive momentum. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. With share prices currently above the stock’s 13-day moving average, a bullish trend is indicated. Also, a rising moving average signals that there has been buying interest in this stock.

Dow Chemical (DOW) Trade Alert – DOW, Rohm and Haas announce Settlement to Close Acquisition; Merger to Result in Job Cuts

Dow Chemical (DOW) shares opened at $7.90 today, maintaining the price throughout the morning. Dow Chemical engages in the manufacture and sale of chemicals, plastic materials, agricultural and other specialized products and services worldwide.

Resolving the litigation initiated by Rohm and Haas against Dow on January 26, 2009, the two companies recently announced they have reached an agreement to close Dow’s previously announced acquisition of Rohm and Haas on April 1, 2009, a resolution seen to be beneficial for each party.

According to a press release, the settlement agreement involves a new substantial equity investment in Dow of $2.5 billion and at Dow’s option an additional $500 million of equity, at the closing of the merger by the two largest shareholders of Rohm and Haas, one of which is the Haas Family Trusts. The other shareholders will receive the original cash consideration at the closing.

Dow chairman and CEO Andrew N. Liveris said, “The restructuring of the terms of the transaction allows Dow to maintain financial flexibility as we proceed to implement our strategy in a way that realizes the original promise of this acquisition.”

On the other hand, the closing of the deal will reportedly result in the elimination of 3,500 jobs from the combined company. Those cuts are on top of 5,000 cuts announced by Dow and 1,500 announced by Rohm and Haas since late 2008.

Reports have it that some of the jobs cuts will come from closing 24 offices and between 10 to 15 plants.

Based in Midland, Mich., Dow Chemical operates in six segments: Performance Plastics, Performance Chemicals, Agricultural Sciences, Basic Plastics, Basic Chemicals and Hydrocarbons and Energy.

The company also engages in the property and casualty insurance and reinsurance business through its Liana Ltd. subsidiaries. It serves various industries, including appliance; automotive; agricultural; building and construction; chemical processing; electronics; furniture; house wares; oil and gas; packaging; paints, coatings and adhesives; personal care; pharmaceutical; processed foods; pulp and paper; textile and carpet; utilities; and water treatment industries.

In its recent chart, DOW’s MACD reflects a weak bullish signal, with the indicator trending above the 9-day moving average signal line but still below the 0 level, indicating bearish moving averages. Trading near its upper Bollinger Band, the stock reflects high price relative to its recent price action. With share prices currently above the stock’s 13-day moving average, an indication of a bullish trend is generally considered.

Merck Co. Inc. (MRK) Trade Alert – Sanofi-Aventis Interested in MRK’s Stake in Merial

Merck Co. Inc. (MRK) shares climbed .53% to $26.34 this morning. Merck is a global research-driven pharmaceutical company that discovers, develops, manufactures and markets a range of products to improve human and animal health.

According to ADP News, citing Les Echos, pharmaceutical company Sanofi-Aventis is interested in acquiring the 50% stake of U.S. sector group Merck & Co in their joint venture Merial, which makes drugs and vaccines for animals.

Merck’s stake in Merial is valued at nearly $ 2.5 billion.

Merck reportedly plans to sell its stake in Merial in order to finance the $41 billion acquisition of fellow drugmaker Schering Plough, a move seen as a buyout of the latter.

Last week, Merck entered into the spotlight after announcing its plans to acquire the rival company. Following the news, analysts at Bernstein raised their rating on Merck’s stock to Outperform and raised their price target to $30 a share from $27.

Favoring Merk’s decision to buy Schering-Plough, analysts at Bernstein noted that Merck seems to be paying a very fair price for what Schering-Plough has to offer.

According to market reports, the merger is chance for both companies to strengthen their core competencies, while diversifying into a wider range of products.

Merck’s operations are principally managed on a products basis and comprises of two business segments: the Pharmaceutical segment and the Vaccines and Infectious Diseases segment.

The Pharmaceutical segment includes human health pharmaceutical products marketed either directly or through joint ventures. These products consist of therapeutic and preventive agents, sold by prescription, for the treatment of human disorders.

Merck sells these human health pharmaceutical products primarily to drug wholesalers and retailers, hospitals, government agencies and managed health care providers, such as health maintenance organizations, pharmacy benefit managers and other institutions.

In its recent chart, MRK’s Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a weak bullish signal, with the indicator trending above the 9-day moving average signal line but still below the 0 level, indicating bearish moving averages. With share prices currently above the stock’s 13-day moving average, an indication of a bullish trend is generally considered.

Google Inc. (GOOG) Trade Alert – Analysts Weigh in on Armstrong’s Move from GOOG to AOL

Google Inc. (GOOG) shares climbed 1.30% this morning, trading at $323.86. Google maintains an index of Web sites and other online content, and makes this information freely available through its search engine to anyone with an Internet connection.

Last week, Time Warner named Google senior vice president Tim Armstrong as chairman and CEO of Time Warner’s AOL unit. AOL’s current chairman and CEO Randy Falco along with president and COO Ron Grant plan to leave the company after a transition period.

Weighing in on Tim Armstrong’s move from Google to AOL, analyst say it’s a modest negative for Google and a positive sign that Time Warner is moving closer to spinning off AOL entirely.

According to a report, most analysts believe Armstrong’s departure may weigh on Google’s stock in the near-term, but won’t have any long-lasting negative impact on the company. Barclay’s Doug Anmuth noted that Armstrong is the most senior executive to leave Google since it went public in 2004.

Merrill’s Justin Post said the hire would be a positive for the Google/AOL partnership since Armstrong played a major role in getting the deal done and knows how to get the most benefit out of that deal for AOL. Post didn’t see any connection between Armstrong’s exit and weak business fundamentals at Google.

Further, Post pointed out that the Google stock may have already weathered any short-term impact from the move because of the recent rumors Armstrong was a leading candidate for the Yahoo CEO position filled by Carol Bartz.

Google’s automated search technology helps people obtain nearly instant access to relevant information from its online index.

The company generates revenue primarily by delivering online advertising. Businesses use its AdWords program to promote their products and services with targeted advertising. In March 2008, the company acquired Click Holding Corp. (DoubleClick), a company that offers online ad serving and management services to advertisers, ad agencies and Web site publishers. In August 2008, the company sold the search marketing business of Performics, a division of DoubleClick. In September 2008, Google Inc. bought Korea-based blogging software developer Tatter and Company.

In its recent chart, GOOG is trading within its Bollinger Bands, a normal condition signaling that the stock is neither overbought nor oversold relative to the recent price action. With share prices currently below the stock’s 13-day moving average, an indication of a bearish trend is generally considered.

Amgen Inc. (AMGN) Trade Alert – AMGN to Present at the Cowen and Company Annual Healthcare Conference

Amgen Inc. (AMGN) shares rose .65% this morning, trading at $51.09. Amgen engages in the discovery, development, manufacture and marketing of human therapeutics based on advances in cellular and molecular biology.

The biotech bellweather announced the company is scheduled to participate present at the Cowen and Company Annual Healthcare Conference Wednesday, March 18, 2009, at the Boston Marriott Copley Place, Boston, Mass., beginning at 9:30 a.m. ET.

James Daly, Amgen’s senior vice president of North American Commercial Operations, will present. Live audio of the presentation will be available over the Internet and can be accessed from Amgen’s Web site, www.amgen.com, under Investors.

Based in Thousand Oaks, Calif., the company markets human therapeutic products primarily in the areas of supportive cancer care, nephrology and inflammation.

Its principal products include Aranesp and EPOGEN that stimulate the production of red blood cells to treat anemia; Neulasta and NEUPOGEN, which selectively stimulate the production of neutrophils, a type of white blood cell that helps the body fight infections; and ENBREL that blocks the biologic activity of tumor necrosis factor by inhibiting TNF, a substance induced in response to inflammatory and immunological responses, such as rheumatoid arthritis and psoriasis.

The company has a joint venture with Kirin Holdings Company Limited to manufacture and market darbepoetin alfa; a co-promotion agreement with Wyeth for marketing and selling of ENBREL; and Johnson & Johnson to commercialize recombinant human erythropoietin as a human therapeutic.

It markets its products to healthcare providers, including physicians or their clinics, dialysis centers, hospitals and pharmacies primarily in the United States, Europe and Canada.

In its recent chart, AMGN’s Bollinger Bands indicate greater than normal volatility as reflected by an increase in distance between the upper and lower bands. Trading within its Bollinger Bands, the stock reflects neither an overbought nor oversold condition relative to its recent price trend. MACD reflects a weak bullish signal, with the indicator trending above the 9-day moving average signal line but still below the 0 level, indicating bearish moving averages. With share prices currently above the stock’s 13-day moving average, an indication of a bullish trend is generally considered.

Strayer Education Inc. (STRA) Trade Alert – STRA Shares Fall on Consulting Firm’s Downbeat Enrollment Report

Strayer Education Inc. (STRA) shares gained 4.87% to trade at $157.78 this morning. Strayer Education, through its subsidiary, Strayer University Inc., provides various academic programs in traditional classroom courses and online via the Internet.

Shares of Strayer fell after Boston-based consulting firm Off Wall Street report showed a looming drop in enrollments.

Just last month, the company reported a 28% increase revenues for the three months ended December 31, 2008, due to increased enrollment and a 5% tuition increase which commenced in January 2008.

Income from operations came in at $39.4 million compared to $29.2 million for the same period in 2007, an increase of 35%. Operating income margin was 34.5% compared to 32.8% in 2007. Net income was $24.2 million compared to $19.5 million for the same period in 2007, an increase of 24%.

Commenting on the recent results, chairman and CEO Robert S. Silberman said, “We had a successful start to 2009 with the opening of new campuses in Augusta, Georgia and Huntsville, Alabama. We look forward to our new campus openings for the 2009 spring term in three new Strayer markets: Allentown, Pennsylvania; Charleston, West Virginia; and Salt Lake City, Utah.”

Showing no signs of slow down, total enrollment at Strayer University for the 2009 winter term reportedly increased 22% to 45,697 students compared to 37,323 students for the same term in 2008.

Across the Strayer University campus network, new student enrollments increased 20% and continuing student enrollments increased 23%. Global (out of area) online students increased 47%, while students taking 100% of their classes online (including campus based students) increased 25%.

The total number of students taking any courses online (including students at brick and mortar campuses taking at least one online course) in the 2009 winter term increased 24% to 32,771.

Headquartered in Arlington, Va., the company provides undergraduate and graduate degree programs in business administration, accounting, information technology, education and public administration through 65 campuses in Alabama, Delaware, Florida, Georgia, Kentucky, Maryland, New Jersey, North Carolina, Pennsylvania, South Carolina, Tennessee, Utah, Virginia, West Virginia and Washington, D.C.

As of December 31, 2008, it had approximately 44,000 students enrolled in its various programs.

In its recent chart, STRA is trading near its lower Bollinger Band, signaling that the stock price is low relative to its recent price action. With share prices currently below the stock’s 13-day moving average, an indication of a bearish trend is generally considered.

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2 Comments »

  1. Very detailed information, thank you.

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