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Friday, August 7, 2009

Dover (DOV) Boosts Qtr Dividend 4% to $0.26

Diversified manufacturer Dover Corp. (DOV) said Thursday it increased its quarterly cash dividend by 4 percent to 26 cents per share from 25 cents.

The increased dividend will be paid on Sept. 15 to shareholders of record as of Aug. 31.

Shares fell 15 cents to $33.86 in afternoon trading.

Disclosure I am long DOV shares.

Handango Inc.

Snap-on Incorporated (SNA) Declares Quarterly Dividend

The Snap-on Incorporated (SNA) board of directors declared today a quarterly common stock dividend of $0.30 per share payable September 8, 2009 to shareholders of record on August 17, 2009. Snap-on has paid consecutive quarterly cash dividends, without interruption or reduction, since 1939.

Disclosure I am long SNA shares.

Escort Radar

Nordic American Tanker (NAT) Declares $0.50 A Share Dividend, Yielding 11.71%

The Company will pay a dividend of $0.50 per share on or about September 4, 2009, to shareholders of record as of August 21, 2009.

To receive this dividend, you must own your shares by August 19th.

Nordic American Tanker Shipping (NAT) said it swung to a second-quarter loss of $137,000, as net voyage revenue dropped to $29.7 million from $63.2 million. It earned $35.5 million in the year-earlier period. It said earnings per share from continuing operations were 9 cents a share. Analysts polled by FactSet had expected earnings of 5 cents a share. The company will pay a dividend of 50 cents per share on or about Sept. 4, 2009, to shareholders of record as of Aug. 21, 2009, down from 88 cents in the first quarter.

Disclosure I am long NAT shares.

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Tuesday, August 4, 2009

Pepsi (PEP)Reaches Deal to Buy Bottlers

PepsiCo (PEP) announced on Tuesday that it has agreed to purchase its two largest bottlers - Pepsi Bottling (PBG) and PepsiAmericas (PAS) - for a combined $7.8 billion, bringing the bottlers back under the wing of the company that divested them 10 years ago.

According to the terms of the agreement, PepsiCo will acquire both companies in a 50/50 cash and stock deal, which values Pepsi Bottling at $36.50 a share and PepsiAmericas at $28.50 a share. The deal will give Pepsi about 80% of its North American beverage distribution market.

PepsiCo said the deal will also the company to further streamline its production and distribution business, in hopes to provide better pricing against its primary competitor Coca-Cola Co. (KO). The deal is subject to shareholder and regulatory approval

"While the existing model has served the system very well, it is clear that the changing dynamics of the North American liquid refreshment beverage business demand that we create a more flexible, efficient and competitive system," said PepsiCo CEO Indra Nooyi in a statement.

For approximately 10 years, both Coke and Pepsi had publicly-traded subsidiaries that provided the distribution and bottling of their respective iconic products. Coke's owns a stake in its largest bottler Coca-Cola Enterprises (CCE), while PepsiCo owns about 33% of Pepsi Bottling and about 43% of PepsiAmericas.

However, as commodity prices and bottling costs have risen in recent years, Pepsi said an integrated approach would be more appropriate instead of outsourcing the expensive product distribution and packaging.

Ultimately, the transaction positions the entire Pepsi system to continue to win in he marketplace," said Pepsi Bottling CEO Eric Foss in a statement.

PepsiCo originally offered to purchase both bottlers earlier this year for a combined total of $6 billion, which was rejected by both companies as being too low.

Pepsi said the deal is being financed through debt financing provided by Bank of America-Merrill Lynch (BAC) and Citigroup (C), who also provided financial advising on the deal for PepsiCo. Pepsi Bottling was advised by Morgan Stanley (MS) and PepsiAmericas was advised by Goldman Sachs (GS).

Disclosure I am long PEP shares.

Bake Me  A Wish

Monday, August 3, 2009

Innophos Holdings beats by $0.03, misses on revs (IPHS)

Reports Q2 (Jun) earnings of $0.81 per share, $0.03 better than the First Call consensus of $0.78; revenues fell 36.8% year/year to $166.8 mln vs the $173.3 mln consensus. On a sequential basis, management currently expects that third quarter 2009 volumes, excluding GTSP fertilizer sales, could increase 5% to 10% from those experienced in the second quarter 2009. The Company expects its third quarter 2009 raw material cost structure on a constant volume and mix basis to be $5 to $7 million higher than the second quarter 2009 due to higher phosphate rock and phosphoric acid costs in Mexico and the mix of phosphoric acid supply in the United States and Canada. Approximately half of this increased cost will be offset by lower restructured fixed costs.

Innophos Holdings, Inc., together with its subsidiaries, produces specialty phosphates primarily in the North America. Its products include specialty salts, which are used in food, beverage, and pharmaceutical applications; specialty acids that are used in industrial applications, such as asphalt modification and petrochemical catalysis; technical grade sodium tripolyphosphate (STPP), which is used in detergent applications, including automatic dishwashing, commercial/industrial detergents, and home laundry detergents; and other products, such as phosphate fertilizers that are used as co-products of manufacturing purified phosphoric acid. Innophos Holdings also offers purified phosphoric acid (PPA) that is used as an input to specialty salts, specialty acids, and STPP, as well as in water and metal treatment applications. The company's customers include consumer goods manufacturers, distributors, and specialty chemical manufacturers in food, bakery, beverage, pharmaceutical, and cleaning product markets. Innophos Holdings was incorporated in 2004 and is headquartered in Cranbury, New Jersey.

Disclosure I am long IPHS shares.

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Chesapeake Energy (CHK)swings to net profit; sets asset sales

Chesapeake Energy Corp. posted late Monday a net profit in the second quarter, reversing a massive year-ago loss as energy hedges worked to the company's favor.

But adjusted earnings for the quarter showed a 22% drop in profit as sharply lower natural gas prices offset gains from a 5% increase in energy production.

To help boost liquidity, reduce debt and fund capital spending, Chesapeake said it plans to sell up to $3.05 billion worth of production properties, leaseholds and other assets in 2009 and another $1.25 billion to $1.80 billion in 2010.

Including one-time items, Chesapeake /quotes/comstock/13*!chk/quotes/nls/chk (CHK 22.33, -0.03, -0.13%) reported second-quarter net income of $237 million, or 39 cents a share. The results include a $597 million gain on oil and gas hedges.

The company had a loss of $1.64 billion, or $3.16 a share, in the year-ago period, which included a $2.1 billion unrealized, non-cash mark-to-market loss from natural gas, oil and cash hedges due mainly to the steep drop in gas futures.

Excluding one-time items, adjusted net income for the three months ended June 30 fell to $377 million, or 62 cents a share, from $485 million, or 90 cents a share, a year ago.

Wall Street analysts, focusing on adjusted income, had expected the Oklahoma City, Okla.-based natural gas producer to earn 53 cents a share on $1.77 billion in revenue, according to a survey by FactSet Research.

Revenue for the quarter fell to $1.67 billion from $2.23 billion a year ago.

Chesapeake fetched on average $5.56 per thousand cubic feet of natural gas in the second quarter of 2009, down sharply from $8.18 a year ago. Gas makes up 92% of Chesapeake's overall energy output.

Given the continued decline in gas prices, Chesapeake has come under pressure to trim production costs while keeping an eye on rising inventories.

The company pumped an average of 2.453 billion cubic feet of natural gas equivalent (bcfe) per day in the second quarter, up 125 million cubic feet a day over 2.328 bcfe produced per day in the 2008 second quarter.

Looking ahead, Chesapeake said it may have to intentionally shut production along with the rest of the industry if the U.S. starts running out of natural gas storage capacity.

"The company is not currently curtailing production, but may do so again later this summer or fall as market conditions dictate," Chesapeake warned last week in a production update. "The company also expects that rising pipeline and gathering system pressures during the next few months will likely result in involuntary natural gas production curtailments across the industry."

Late last week, Chesapeake said its big four shale gas plays - Haynesville, Marcellus, Barnett and Fayetteville - continue to perform as expected.

In the face of cheaper natural gas prices, Chesapeake has been cutting costs.

The company said late last week it expects to report total drilling and net acquisition costs for the second quarter of less than $1 per thousand cubic fee equivalent.

Chesapeake shares closed ahead of the report with a 92-cent gain at $22.36. The stock is down 55% over the past 12 months, compared with a 21% decline by the NYSE Arca Natural Gas Index (XNG) over the same period.

Disclosure I am long CHK shares. 468x60 banner, image is updated by season.

Jim Rogers: Focus on China Video

Nine minute video by Mr. Rogers; as usual unflattering towards the U.S. and constructive on China long-term. As I wrote in a piece last week, after the doubling in the stock market, he is cautious nearer-term on China. A nice swipe in the last minute at Timothy Geithner and a general comment about the U.S. holding no high ground to tell anyone how to run an economy.

Disclosure None

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3 High-Yield ETFs You May Be Missing

Are you craving more risk and the potential for higher yields in your investments? There are several overlooked high-yield exchange traded funds (ETFs) that are gaining as investors become more risk-tolerant.

Investors can use ETFs for a number of reasons, including to capture capital appreciation and above-average dividends, writes Matthew D. McCall for Seeking Alpha. McCall provides a few ETFs he believes will have the right amount of performance and dividend yields. We should note, too, that this is by no means a complete list of all high-yielding ETFs with good performance – there are many available, so be sure to look around.

SPDR Barclays Capital High Yield Bond (JNK), currently up 23.8% year-to-date, follows corporate high-yield bonds, otherwise known as junk. The ETF also pays out a monthly dividend that comes out to an annual yield of 13%. When the economy goes back to normal, undervalued risky assets could begin to attract more attention.


iShares S&P U.S. Preferred Stock Index (PFF), currently up 27.4% year-to-date, tracks preferred shares of companies, primarily in the financial sector. Annual dividend yield is 11%. The ETF is a good way to tamp down some risk that comes with including the financial sector in an investment portfolio.


Market Vectors High-Yield Muni ETF (HYD), currently up 7.1% in the last three months. HYD is a relatively new ETF that invests mainly in high yield municipal bonds. But around 25% is in investment-grade bonds. HYD has a 30-day SEC yield of 7.16%, which is better than the taxable bonds. Those in the 28% tax bracket will have tax-equivalent yield of 9.94%, and those in the 35% tax bracket will have as much as 11.02%.


It should be noted that HYD is ideal for a taxable account and people in a high tax bracket. JNK and PFF are better for tax-deferred accounts, McCall says.

Always be sure to watch the trend lines first to find areas that have entered into a potential long-term uptrend. Then explore the characteristics of the funds, including volume, assets and yield.

Disclosure I am long HYD, JNK, PFF shares.

Kimberly-Clark (KMB) Approves $0.40 Per Share Quarterly Dividend

he board of directors of Kimberly-Clark Corporation (KMB - Quote) has declared a regular quarterly dividend of 60 cents per share. The dividend is payable on October 2, 2009, to stockholders of record on September 4, 2009.

Kimberly-Clark and its well-known global brands are an indispensable part of life for people in more than 150 countries. Every day, 1.3 billion people - nearly a quarter of the world's population - trust K-C brands and the solutions they provide to enhance their health, hygiene and well-being. With brands such as Kleenex, Scott, Huggies, Pull-Ups, Kotex and Depend, Kimberly-Clark holds the No. 1 or No. 2 share positions in more than 80 countries. To keep up with the latest K-C news and to learn more about the company's 137-year history of innovation, visit

Disclosure I am long KMB shares.

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