teva

"Stocks are likely in a new downtrend," says Michael Ashbaugh. In Marketwatch's The Technical Indicator, he looks at the S&P's prospects and some drug stocks set to buck the trend.

"The S&P 500 has violated its major moving averages in the closely tracked 900 area. The recent downturn was convincingly bearish, placing the burden on market bulls to reassert the uptrend.

"After finding resistance in the 923 area, the S&P sold off sharply, edging back under its 200-day moving average, which currently holds at 900 and now marks resistance. This is bearish price action.

Surviving this recession is foremost on peoples' minds, but giving to charity is especially important in times like these. So how can you effectively give while preserving your net worth?

If you plan on liquidating any profitable, or taxable, positions in the stock market thanks to the current uptrend and also want to give to your favorite charity, the strategy outlined below is key to optimizing your gift, as well as your capital.

Though giving cash to causes is the most popular form of charity, desperate times call for creative measures, and any type of gift will be gladly accepted. By giving stock directly to charity, and bear in mind that the stock must be in your portfolio for one year or more as short-term capital gains are not applicable, you not only avoid capital gains taxes on your gains, but you can actually use the gift of your stock as a tax deduction. Hence, the cost of your gift is lower than giving cash directly. Think of it as an overall investment for yourself and the charity.

"Generic drug mak Teva Pharmaceutical, Ltd. (NASDAQ: TEVA) delivered respectable earnings results," says Jack Adamo, who added the stock his Insiders Plus model portfolio.

"The company's earnings were up 4% on a proforma non-GAAP basis. In this case, that's the correct measurement. Net GAAP earnings were up tremendously, but aren't really representative of normal business factors.

"Although Teva gets much of its earnings from its proprietary multiple sclerosis drug, Copaxone, its primary business is generic drugs. That segment is inherently lumpy because profitability is greatly affected by which generic drugs it brings to market before any other generic company.

Analyst upgrades:

• Jefferies upgraded Brocade (NASDAQ: BRCD) to Buy from Hold on expectations expanding OEM partnerships, new products and entry into new markets will drive long-term growth. The firm's channel checks indicate the first phase of an IBM (NYSE: IBM) deal for ethernet products will be announced next week. Jefferies raised its target price on the stock to $6 from $3.50.
  
• JMP Securities upgraded Broadcom (NASDAQ: BRCM) to Market Perform from Underperform citing the potential settlement with Qualcomm (NASDAQ: QCOM). The firm said Broadcom has far more to gain than Qualcomm has to lose.
  
• Citigroup upgraded Air Products (NYSE: APD) and Praxair (NYSE: PX) to Buy from Hold on expectations that an improvement in customer operating rates will benefit gas companies. The firm raised its target price on Air Products to $70 from $55 and on Praxair to $79 from $63.
  
• Royal Bank of Scotland upgraded BP Plc (NYSE: BP) to Buy from Hold to reflect its dividend yield at current levels.
• Apple (NASDAQ: AAPL) was raised to Outperform from Underperform at RBC Capital.
  
• T. Rowe Price (NYSE: TROW) was upgraded at Sandler O'Neill to Hold from Sell.
  
• Morgan Stanley (NYSE: MS) was lifted to Neutral from Underperform at Banc of America/Merrill.

Analyst upgrades:

• Bernstein upgraded Merck (NYSE: MRK) to Outperform from Market Perform and raised its target to $30 from $27 citing valuation and its decision to buy Schering-Plough, at what appears to be a reasonable price.
  
• RBC Capital upgraded Palm (NASDAQ: PALM) to Outperform from Sector Perform and raised its target to $12 from $5 as it believes webOS has increased its chances for Smartphone leadership and will increase its attractiveness as an acquisition target.
  
• RW Baird upgraded Alcatel-Lucent (NYSE: ALU) to Outperform from Neutral on valuation as it believes balance sheet risks are overly discounted in the stock, creating a buying opportunity. The firm has a $3 target on shares.
• Express Scripts (NASDAQ: ESRX) was raised to Buy from Hold at Argus.
  
• France Telecom (NYSE: FTE) was upgraded at Morgan Stanley to Equal Weight from Underweight.
  
• Foster Wheeler (NASDAQ: FWLT) was upgraded to Conviction Buy from Neutral at Goldman.

Here are some highlights from this past week's earnings coverage from BloggingStocks:

• Apollo Group Inc. (NASDAQ: APOL) reported that Q4 revenue soared despite the recession.
• Baidu Inc. (NASDAQ: BIDU) posted strong annual revenue, but at a slowing growth rate.
• Career Education Corp. (NASDAQ: CECO) easily topped Q4 earnings expectations, lifting shares up.
• Comcast Corp. (NASDAQ: CMCSA) Q4 earnings beat expectations and it increased its dividend.
• CVS Caremark Corp. (NYSE: CVS) shares jumped after it reported higher earnings in Q4.
• Digital River Inc. (NASDAQ: DRIV) shares soared on better-than-expected Q4 earnings and revenue.
• Expedia Inc. (NASDAQ: EXPE) reported dismal results due to a huge good will write down.
• Goodyear Tire & Rubber Co. (NYSE: GT) posted a greater-than-expected Q4 net loss and announced job cuts.
• Hormel Foods Corp. (NYSE: HRL) exceeded Q1 earnings expectations due to the popularity of SPAM.

U.S. stock markets were set to plunge at the open Tuesday morning as three issues weighed on investors' minds: The economic stimulus plan, the auto industry as well as hard-hit Eastern Europe: Before the bell: Stocks set to plunge on stimulus package, auto sector worries

General Motors Corp. (NYSE: GM) and Chrysler LLC are expected to submit recovery plans to the government today to show how they can repay billions in loans and become viable. Of course, abysmal auto sales haven't been helping any company in the industry. Ex-Lazard banker Ron Bloom is expected to be named a key government adviser, according to The Wall Street Journal, and he is expected to be tough, demanding sacrifices by all involved, from auto workers and industry executives to shareholders and creditors. The AP reports that GM was making progress in concession talks with debtholders and the UAW. Also, GM Europe is considering shutting or selling as many as four European plants. GM shares are down 5.6% in premarket trading. GM shares declined over 12% an hour after the open.

Teva Pharmaceuticals (NASDAQ: TEVA - option chain) shares have moved higher today after the Food & Drug Administration approved the company's generic version Pulmicort, an asthma drug made by competitor AstraZeneca (NYSE: AZN). If you think that the stock won't fall by too much in the coming months, then now could be a good time to look at a bullish hedged trade on TEVA.

TEVA opened this morning at $43.00. So far today the stock has hit a low of $42.55 and a high of $43.78. As of 12:25, TEVA is trading at $42.84, up $0.65 (1.5%). The chart for TEVA looks bullish and S&P gives TEVA a positive 5 STARS (out of 5) strong buy ranking.

For a bullish hedged play on this stock, I would consider a January bull-put credit spread below the $35 range.

It was July 1, 2008 when I first posted Serious Money: Five stable stocks for troubled times. The title speaks for itself. This update, after nine weeks and horrible market conditions, is through Friday October 3, 2008.

The index for comparison is the Standard & Poor's 500 Index, which closed on June 30, 2008 at 1,280.00. The S&P closed Friday at 1,099.23 , down 14.12%.

Each of my five picks is beating the market and three of the five are actually up despite crushing news in the financial sector, unemployment and housing. Congress did pass a Wall Street backstop/bailout bill that President Bush has signed, but only after adding another 450 pages and $130 billion to the amount. Although the five stocks have averaged a 0.75% loss, as intended, they easily beat the S&P by 13.37%.

Here are the five stocks that I still think are worth considering. For my original rationale see the linked story above.

1) Johnson and Johnson (NYSE: JNJ) -- when recommended, the stock closed at $64.34 and paid a 2.89% dividend yield. It closed Friday at $66.16 -- up 2.75%. JNJ was featured in Barron's this month as the most respected from the top 100 companies in the world.

2) Teva Pharmaceuticals ADR (NASDAQ: TEVA) -- when recommended, the stock closed at $45.80 and paid a 1% dividend yield. It closed October 3 at $46.08 -- up 0.06% 0.62% Teva (of Isreal) is the largest generic drug company in the world and just got bigger through the acquisition of Barr Pharmaceuticals last month.

If John McCain wants my vote he must dump Sarah Palin and fast. Judging by the latest polls showing Barack Obama moving ahead and gaining traction, I'm not the only one that feels this way. The outcome of the election is key to investors worried about a range of issues including the $700 billion federal bailout of Wall Street.

Obama may lack the experience I would hope to see in a presidential candidate but to quote a friend and fellow McCain supporter "Sarah Palin is an idiot and the only way she should be allowed in the White House is if she buys a tour ticket." This is not a unique sentiment given the Sarah Palin must go stance taken by conservative columnist Kathleen Parker of the Los Angeles Times. She says her cringe reflex is being exhausted.

I do not like Obama's proposals on capital gains taxes, a windfall oil profits tax, new government programs and several other issues, but the idea of Palin being second-in-command is a joke. And speaking of jokes, if I have misjudged, and McCain and Palin win the election, then Oprah will be surpassed as the wealthiest female in the entertainment industry. The new titan will be 30 Rock and former Saturday Night Live star Tina Fey who will be racking up fat paychecks based on the never ending material supplied by Palin.

Analyst upgrades:

• Keefe Bruyette upgraded shares of AllianceBernstein (NYSE: AB) to Outperform from Market Perform as they find AB's risk/reward attractive given its attractive long-term business model. Wachovia upgraded Watson Pharma (NYSE: WPI) and Teva Pharma (NASDAQ: TEVA) to Outperform from Market Perform citing valuations and positive drivers for generics that include patent expirations and market share expansion.
• UBS raised Lloyds TSB Group (NYSE: LYG) to Neutral from Sell on expected pricing power following the HBOS (OTC: HBOOY) acquisition.
• Otter Tail (NASDAQ: OTTR) was upgraded to Outperform from Neutral at Baird.
• GFI Group (NASDAQ: GFIG) was upgraded at Citigroup to Hold from Sell.
• Merrill upgraded Logitech (NASDAQ: LOGI) to Neutral from Underperform.

Analyst downgrades:

• JP Morgan downgraded shares of Lloyds TSB Group to Underweight from Neutral on capital concerns and believes the HBOS acquisition is not in the best interest of shareholders.
• Stephens downgraded Universal Truckload (NASDAQ: UACL) to Equal Weight from Overweight on valuation and concerns about a slowdown in the flatbed sector. The firm's target remains $28.

After a volatile, historic week on Wall Street that featured Lehman Brothers going bankrupt, Merrill Lynch being bought and the government bailing out AIG, culminating Sunday when the last large independent brokers were granted bank status. This morning futures are lower as investors seem to be taking a breath to take it all in with a cautious eye on the government's most recently announced plan -- a $700 billion proposal to buy a mountain of bad mortgage debt. But it is the dollar that may get crushed following the plan.

Goldman Sachs (NYSE: GS) and Morgan Stanley (NYSE: MS) the last of the large independent brokers, have applied and were granted bank status Sunday. Both are down 1.7% and 1.8% respectively in pre-market trading.

According to MarketWatch, several companies left out of the short-selling ban list may ask to be added to the list. Companies like General Electric Co. (NYSE: GE) with its financial services unit making up 45% of its business, or American Express (NYSE: AXP) and CIT Group (NYSE: CIT) are a few examples.

Ambac (NYSE: ABK) shares are down another 12% in pre-market trading after closing down nearly 42% Friday as Moody's said it might downgrade the bond insurer's ratings.

The Dow Jones is down around 300 points again (Update: closed down 450) so it's time to revisit my stable stock picks to see how they are holding up. Each of my five picks is beating the market and all of them are up despite crushing news in the financial sector every day since my last report.

The prediction business is highly speculative, but I gave it a try anyway, searching for stocks that would hold their value. This update is a spot-check of my earlier post, Serious Money: Five stable stocks for troubled times. The closing prices are from yesterday but these companies are doing well in today's down market too as the government steps in again and bails out AIG with $85 billion.

The standard for comparison is the Standard & Poor's 500 Index, which closed on June 30, 2008 at 1,280.00. The S&P closed yesterday at 1,213.59, down 5.47%. The percentage gains for the stable stocks do not include dividends. They are up 4% for a 9.47% advantage. The volatility in the market today may alter some of the data points so expect an after market update. Update: the following five stocks remain ahead of the market but they did turn down in the last hour.

1) Johnson and Johnson (NYSE: JNJ) -- when recommended, the stock closed at $64.34 and paid a 2.89% dividend yield. It finished at $69.80 -- up 8.48% -- and is trading up this morning. JNJ was featured in Barron's this week as the most respected from the top 100 companies in the world. Final Update: down $-0.29 to $69.51

2) Teva Pharmaceuticals ADR (NASDAQ: TEVA) -- when recommended, the stock closed at $45.80 and paid a 1% dividend yield. It finished at $45.96 -- no change -- and is trading slightly down this morning. Teva is the largest generic drug company in the world and just got bigger throught the acquisition of Barr Pharmaceuticals. Final Update: down $-1.25 to $44.11

Analyst upgrades:

• Goldman upgraded shares of Novartis (NYSE: NVS) to Buy from Neutral as they believe the Alcon (NYSE: ACL) acquisition has diversified the company's business.
  
• Tyson Foods (NYSE: TSN) was upgraded to Equal Weight from Underweight on valuation.
  
• JP Morgan raised Albermarle (NYSE: ALB) to Overweight from Neutral.
  
• BMO Capital upgraded Wynn Resorts (NASDAQ: WYNN) to Outperform from Market Perform.
  
• Synovus Financial (NYSE: SNV) was lifted to Buy from Hold at Sterne Agee.

Analyst downgrades:

• Morgan Stanley downgraded Reynolds American (NYSE: RAI) to Underweight from Equal Weight based on the impact from Altria's (NYSE: MO) purchase of competitor UST (NYSE: UST), which may result in pricing pressure.
  
• Goldman downgraded AstraZeneca (NYSE: AZN) to Sell from Neutral as they believe shares do not support near-term fundamentals.
• Max Capital (NASDAQ: MXGL) was downgraded to neutral from Buy at Banc of America.
  
• AudioCodes (NASDAQ: AUDC) was lowered at Merrill to Neutral from Buy.
  
• Pinnacle Financial (NASDAQ: PNFP) was downgraded to Neutral from Outperform at Baird.

I was out all morning and returned to my desk to find employment and retail numbers sent the Dow Jones Industrial Average tumbling down 345 points today. That made me think it was important to check out how stable my stable stocks -- stocks with the ability to ride out this bearish run -- were doing in bad times.

This update is a spot-check of my earlier post Serious Money: Five stable stocks for troubled times, to see how my picks are holding up so far. Closing prices are for today.

The standard for comparison is the Standard & Poor's 500 Index, which closed on June 30, 2008 at 1,280.00. The S&P closed today at 1,236.82, down 3.37%. The percentage gains do not include dividends. Four out of five of my picks beat all the indices; CB was close.

1) Johnson and Johnson (NYSE: JNJ) -- when recommended the stock closed at $64.34 and paid a 2.89% dividend yield. It finished at $70.45 -- up 9.5%

2) Teva Pharmaceuticals ADR (NASDAQ: TEVA) -- when recommended the stock closed at $45.80 and paid a 1% dividend yield. It finished at $47.92 -- up 4.63%.