(GS) Alstom- Off Conv. Buy List - full note attached

* What happened
Alstom’s board has approved the revised GE offer. The French State has
confirmed that, subject to execution of definitive agreements for the
various alliances between GE, Alstom and the State, including the Global
Nuclear & French Steam Alliance, it will grant the required foreign
investment authorization. Bouygues has also agreed to sell a 20% stake in
Alstom to the French State. We downgrade Alstom to Neutral (was
Conviction List Buy) and change our 3-month target price of €36 to a 12-
month target price of €28.5. Since being added to the Conviction Buy List on
May 2, 2014, the shares are down 5.9% vs the FTSE World Europe up 3.1%.

* Current view
We assume that the current Energy deal with GE as accepted by the board
goes ahead (subject to outstanding contingencies) and value Alstom at
€28.5/share. We value Alstom (Transport assets inc. GE Signaling) post
deal on 9x CY15/16E EV/EBIT. We believe Alstom’s competitive positioning
slightly improves post-deal, albeit the company still ranks in the bottom
quartile of our global multi-industry framework; see our report Preparing
for the next industrial revolution, April 28, 2014. The main reason for this
higher ranking is Rail’s higher long-term growth prospects than Power
Generation (we expect 0.8% long-term growth for Alstom post-deal vs. -0.5%
for Alstom pre-deal). We assume Alstom’s returns post-deal will still be
bottom quartile in the context of the capital goods sector.

Our new EV/EBIT-based (9x CY15/16E) 12-month target price of €28.5 implies
only 2% upside for Alstom shares; hence our downgrade to Neutral. Key
upside risks to our Neutral rating are: a material improvement of the
global rail outlook, higher-than-expected synergies between Alstom
Transport and GE Signaling, better-than-expected GE Signaling
profitability (assumed high single digit), and better-than-expected FCF
generation of the standalone entity. Downside risks include failure of the
completion of the deal as subject to outstanding contingencies, further
litigation charges and weaker earnings.

(Makor) Special Situations: Lululemon (LULU): BUY $40.23


Event Driven Strategies Special Situation: LULULEMON

BUY  & re-iterating short UA

 

LULU US: US$ 40.23 ; UA US: US$ 58.88

 

June 23, 2014

Another US/Canadian apparel company, Lululemon, is under the event driven spotlight.  Lululemon is a $6bn fast growing designer and retailer of athletic products, mainly for Yoga. The company was IPOed in 2007 at $9.00 and has been extremely successful ever since.  Revenues have grown from $270m in 2008 to expected $1.8bn next year while net income has grown from $30m to $250m over the same period.  However, as is often the case with high growth companies, LULU had a string of  disappointing earnings reports and the stock recently corrected from a high of just over $80 in 2013 to the current $40. As a result, the Lululemon’s founder, Dennis “Chip” Wilson, in “in talk” with Goldman Sachs to look at opportunities aimed at maximizing LULU’s shareholder value.  Dennis Wilson owns about 26% but has no managerial role in the company anymore and he has been a controversial if not wildly successful entrepreneur (http://fullcomment.nationalpost.com/2013/12/10/brian-hutchinson-lululemon-founder-isnt-dead-yet-hes-just-resting/).  He recently tried unsuccessfully to remove two board members including the Chairman who had just replaced him.

Lululemon is a clear undervaluation outlier within its peer group.  It achieves the highest profitability (20% operating margins, 32% operating return on assets).  Moreover, in terms of growth, Lululemon is also undervalued, particularly vs. Under Armour.

FULL REPORT ATTACHED

(BFW) Alstom Cut to Neutral at Goldman as Revised GE Offer Accepted

Alstom Cut to Neutral at Goldman as Revised GE Offer Accepted
2014-06-23 13:22:05.407 GMT


By Nadine Skoczylas
     June 23 (Bloomberg) -- Alstom cut to neutral from
conviction list buy at Goldman Sachs, PT to EU28.5 from EU36.
  * Since being added to list on May 2, Alstom down 5.9% vs FTSE
    World Europe up 3.1%: GS
  * Shares down 2.5% after falling as much as 3.4% earlier today
  * Has 4 buys, 12 holds, 5 sells; avg. PT EU30.50 implies
    upside of ~12%: Bloomberg data
  * NOTE: Alstom may be worth EU32/shr post-GE deal, UBS says
  * NOTE: GE prevailed over Siemens counterproposal, initial
    French opposition to win Alstom deal


For Related News and Information:
First Word scrolling panel: FIRST<GO>
First Word newswire: NH BFW<GO>

--With assistance from Joshua Fineman in New York. 

To contact the reporter on this story:
Nadine Skoczylas in Jerusalem at +972-2-640-1103 or
nelsibai@bloomberg.net
To contact the editor responsible for this story:
James Ludden at +44-20-7673-2645 or
jludden@bloomberg.net

>>> US Gapping Down

Gapping down
In reaction to disappointing earnings/guidance: XXIA -5%, FMC -1.8%.

Select EU financial related names showing weakness:NBG -3%, IRE -2.4%, RBS -1.4%, ING -1.1%, DB -0.8%.

Other news: MTOR -15.4% (reaches agreement with Eaton (ETN) to Settle Antitrust Lawsuit), BIOA -5% (secures CAD20 mln loan for Sarnia plant, light volume), KNDI -4.7% (files for $300 mln mixed securities shelf offering).

Analyst comments: ENBL -2.4% (initiated with a Market Perform at Wells Fargo), NGHC -2% (downgraded to Neutral from Buy at Guggenheim), NVDA -2% (downgraded to Underperform from Sector Perform at Pacific Crest), PER -1.5% (downgraded to Mkt Perform from Outperform at Raymond James), TDC -1.3% (downgraded to Mkt Perform from Mkt Outperform at JMP Securities), SPWR-1.2% (downgraded to Hold from Buy at Brean Capital), COH -1.2% (downgraded to Underperform from Neutral at Wedbush)

>>> US Gapping up

Gapping up
In reaction to strong earnings/guidance: NEO +6.9%, ABBV +1.8%.

M&A news: TEG +13.8% (Wisconsin Energy (WEC) to acquire TEG for $9.1 bln in cash; total consideration is valued at $71.47 per Integrys share), CENT +11.7% (Harbinger Group (HRG) offers to acquire Central Garden & Pet Company for $10.00 per share in cash), PLXT +12% (to be acquired by Avago Technologies (AVGO) for $6.50 in cash), MCRS +2.2% (acquired by ORCL for $68/share in cash.

Select metals/mining stocks trading higher: BHP +1.9%, CLF +1.5%, RIO +1.1%, MT +0.9%.

Other news: COCO +33.3% (U.S. Department of Education agree in principle on transition plan; co will immediately receive $16 mln in federal student aid funds earned through enrollment), TOPS +9.6% (announces delivery of first newbuild vessel), RMTI +7.8% (receives FDA approval for Calcitriol), AZC +7.4% (and Hudbay (HBM) agree to friendly acquisition), ASTI +6.5% (reaches significant milestone for its proposed joint venture with the city of Suqian of Jiangsu Province), LULU +5.6% (founder has hired Goldman Sachs (GS) to shake up Board, according to reports), RBY +5.3% (infill drilling program continues to increase confidence in the f2 deposit at the phoenix gold project), TGD +5.1% (announces four new independent nominees for board), TC +4.9% (announces pricing terms for exchange offer of common stock for its 6.50% tangible equity units), SPPI +4.3% (still checking), NSPH +2.2% (signs molecular diagnostic supply agreement with HealthTrust), GNCA +2% (announces positive Top-Line Phase 1 results for novel universal pneumococcus vaccine candidate GEN-004), PIR +2% (strength following last week's decline), NAT +1.8% (Co's spin-off Nordic American Offshore (NAO) orders two more vessels), CBST +1.6% (SIVEXTRO approved in U.S. to treat serious skin infections—including those caused by MRSA), MU +1.4% (trading higher ahead of earnings), MY +1.1% (higher on strong China PMI data), INO +1% (initiates cervical cancer clinical trial), CBI +0.8% (awarded five-year contract by Exelon Generation valued at $800 mln for plant services).

Analyst comments: SQNM +5.8% (upgraded to Outperform from Mkt Perform at William Blair), BURL +4.4% (upgraded to Buy from Neutral at Goldman), WHX +3.6% (upgraded to Outperform from Mkt Perform at Raymond James), DISH +1.3% (upgraded to Buy from Neutral at Citigroup), EXPR +1% (upgraded to Buy from Neutral at Janney), BBRY +0.9% (upgraded to Equal Weight from Underweight at Evercore).

>>> Valeant Pharma Posts Answers To Refute Allergan's (AGN) Misleading Statement

Valeant Pharma Posts Answers To Refute Allergan's (AGN) Misleading Statements

US IMS data will cover less than 30% of Valeant's business and, for that portion of Valeant's business IMS covers, the IMS data will not properly collect sales through a numbers of channels (e.g., specialty pharmacy, physician dispensed sales, corporate accounts, and alternative fulfillment).

In Q1 2014, quarter over comparable quarter in Q1 2013 o 13 of the top 15 Valeant products are growing : Wellb utrin XL, Renu, Solodyn, Xenazine, Ocuvite, Preservision, Lotemax Gel, Elidel, BioTrue Solution, Artelac, CeraVe, Syprine, and Acanya o 9 of the 15 are growing by volume : Renu, Xenazine, Ocuvite, Preservision, Lotemax Gel, Elidel, BioTrue Solutions , Artelac , CeraVe o Two products that are not growing are Zovirax (impacted by generic competition) and Boston Solution

See attached fot full dertails

World 3D printing technology expo opens in China

--> could move DDD & SSYS

World 3D printing technology expo opens in China

3D printing technology has been around for nearly three decades, but industry professionals estimate that its worldwide market accounts for just 20 billion yuan, less than what a global Internet company such as Google makes in a year.

Industry professionals from 11 countries are in Qingdao now to discuss 3D printing and what’s hindering its market growth.

3D printing technology has been around for nearly three decades, but industry professionals estimate that its worldwide market accounts for just 20 billion yuan.

With no concrete and no steel, one Qingdao company is making a bold move: using 3D technology to print an actual house. It will take six months for the world’s largest 3D printer to complete the project.

Even for smaller items, such as toys, it usually takes hours or days for the objects to emerge from a 3D printer, and the cost of material is usually calculated per gram.

There is no doubt that the 3D technology can print a variety of items but if some can be produced much cheaper and more quickly in a traditional factory, why bother use 3D printing?

3D printing technology has been around for nearly three decades, but industry professionals estimate that its worldwide market accounts for just 20 billion yuan.

"Although 3D technology can produce anything traditional manufacturing makes, many products we produce are not functional. Traditional manufacturing’s economy of scale is clearly not the strength of 3D printing," Luo Jun, Secretary General of China 3D Printing Technology Industry Alliance, said.

While most 3D printing businesses in China are profiting from making and selling 3D printers, some are already spotting the real strength of 3D printing technology.

"Nowadays young people like individualized things, so we think this is going to provide us with huge business opportunities," Cheng Yongli, Manager of Hechuang Manufacturing, said.

"What we need to do is to make things traditional manufacturing can’t make or doesn’t make economically," Zhang Liuyang, Planning Manager of Magic said.

Industry insiders say that determining exactly how 3D printing technology can be applied and turned into profit is key to expanding the market. They estimate that the Chinese market will reach 4 billion yuan by the end of 2014.