Coke: Is It..AGAIN

Recommendation:

The world’s most recognizable brand is back. Several factors converging together will contribute to move the stock higher after years of moving sideways.

Analysis:

• The company just announced a new CEO in Muhtar Kent. Kent is an internationally experienced CEO and is heralded by the hometown’s

• Coke might be further encroaching on Starbucks’ coffee monopoly. Several years ago it launched its Far Coast coffee trial store and now it has introduced it Full Throttle Coffee Beverage.

• The company continues to price its core products aggressively. As consumers switch off bottled water in the face of poor economic conditions, environmental concerns over plastic bottles, and studies which show no added benefit from bottled water, they may again turn to the old mainstay: soft drinks. This scenario is reminiscent of McDonald’s plight several years ago. Many spectators had written the brand off in the face over the growing health concerns of fast food only to see the company come roaring back with a new CEO and new product innovations. It helps to have a solid brand.

Prediction:

The stock trades at 51.98. Ticker (KO). The PE is 19.54. Expect it to reach 57 by December 30, 2008.

VMware: Down; Not Out

Recommendation:

VMWare, a company whose main products revolve around the next new thing in tech: virtualization, should also benefit as it develops new products in another new technology “cloud computing.”

Analysis:

• VMware was a recent spin-off from EMC. It was heralded in its spin-off for having a huge advantage in the virtualization space far outreaching its closest competitor.

• Microsoft is now in the process of launching new products to compete with those of VMware. Counterintuitively, this will help VMware. Microsoft is desperate to return to its winning tech days and an acquisition of VMware should not be seen as out of the question. Aside from reaching comparative products both also seem to be on a collision course to take advantage of the new trend in tech “cloud computing.” IDC recently heralded “cloud computing” as one of the next big drivers for the future.

• The stock is off 2/3 from its 52 week price high of 125. Much can be attributed to the market sell off, but should have no bearing on the stock going forward as it operates in a growth area.

Prediction:

The stock is trading at 51.05. Ticker (VMW). The PE is 87.91. Expect it to reach 72 by June 27, 2009.

Astronics: To The Sky

Recommendation:

Astronics, a supplier to the aerospace industry, should continue to benefit from one of the strongest industries in the next year: Aerospace. Despite rising oil costs nations across the globe continue to expand creating the ideal climate for tourism and trade

Analysis:

• In today’s MarketWatch.com market pulse company there was an interesting excerpt on Boeing. Sanford Bernstein notes that even if some orders were canceled the demand for airlines is so tight that Boeing will continue to see profits for the next several years.

• The stock is just off its 52 week low for the year.

• The company was recently named the #1 Fastest Growing Small Business by Forbes Magazine.

Prediction:

The stock is trading 15.43. Ticker(ATRO). It has PE of 9.93. Expect it to reach 19 by December 26, 2008.

GeoEye: The Eyes Have It

Recommendation:

GeoEye, whose main product of satellite imagery, competes in a very new yet competitive space that will grow everymore so with new entrant DigitalGlobe seen IPOing soon. However, there should be industry consolidation arriving soon.Nokia has offered to purchase GPS provider NAVTEQ.

Analysis:

• Satellite imagery, previously only accessible to governments, worldwide has found a new market in the consumer space with the advent of GPS.

• The market for satellite imagery remains an largely untapped market for applications in a wide variety of fields including agriculture, residential development, and space exploration.

• The stock is off considerably for the year having reached a high of 36 back in 2008.

Prediction:

The stock currently trades at 18.20. Ticker (GEOY). It has a PE of 18.20. Expect it to reach 23 by December 25, 2008.

Bunge Ltd. : Jump Into This Stock

Recommendation: Bunge Ltd. announced yesterday that it will be buying Corn Products International for 4.4 Billion Dollars. This acquisition will prove to be a prescient one as the demand for beef globally drives up corn prices as well as the continued production of corn for ethanol.

Analysis:

• Excellent article in the Wall Street Journal yesterday titled ” Bunge Bean Counters Looking Beyond Soy” making the point that it is unusual for commodity companies to be acquired at their top. Usual such companies are picked up in the lowest point of the earnings cycle. Article goes onto note that Corn Products Intl. stock has doubled in last two years and despite this Bunge believes corn prices will go higher.

• Move is very reminiscent of the ConocoPhillips/Burlington Resources deal in December 2005. Many thought that ConocoPhillips was overstating the value of natural gas prices at the time and criticized the acquisition as expensive. However, over the past 5 years the stock is up over 200 %.

• Acquisition will point UK based Bunge in direct competition with Archer Daniels Midland and Cargill as the top corn producers in the world. The scale of the company should help as well as the fact that one of the main competitors Cargill is private and may not enjoy the resources to compete as a public company might.

Prediction:

The stock is currently trading at 111.85. Ticker (BG). The PE is 14.36. Expect it to reach 120 by December 24, 2008.

James River Coal: Coal Trend To Big To Ignore

Recommendation: James River Coal, whose stock has been on a run recently, should continue to benefit from strong global demand for Coal especially in the U.S. and China.

Analysis:

• Bloomberg today ran a story on the increased price hikes China can expect for iron ore from Brazil’s Rio Tinto. Usually it is best to stay away from hot stocks or trends on Wall Street as 80% of their value is captured by the time everyone hears they should buy specific stocks. This has certainly been the case with Coal Stocks over the past year. Yet, every rule has its exception. I do believe at least for the time being coal is the new oil. For the next several months there should be continue upside to coal stocks.

• Raymond James only last week upped it stock recommendation on James River from 53 to 72 noting the company’s 2009 revenue projections were not reflecting the full value of specific coal contracts.

• James River, while a smaller coal outfit compared to Arch Coal and Peabody, has also had a greater stock run over the last year. Given its light analyst coverage this should continue.

Prediction:

The stock currently trades at 61.81. Ticker (JRCC). The PE is NA. Expect it to reach 80 by December 23, 2008.

Wilmington Trust: Company To Benefit From Investment Banking Fall

Recommendation: Wilmington Trust should benefit in the coming months as the investment banks continue to stumble and Hedge Funds and Trust are seen as viable places for depositing money.

Analysis:

• The site On Wall Street had an interesting summary of a Bloomberg article which noted that Trust companies should benefit as high net individuals move money out of investment banks and into Trusts.

• Wilmington Trust was specifically quoted in the article stating that it has increased its financial advisors to close to 80 when they numbered 45 only two years ago. Its advisory business alone had seen a 17% increase in revenue in 2007.

• It does not have the scale as some of the larger trust companies although it announced in May 2008 that it would be increasing its presence in Amsterdam and thus adding to its European group of Dublin and Frankfurt.

Prediction: The stock currently trades at 30.69. It has a PE of 11.58. Expect it to reach 35 by December 20, 2008.

Huntsman: Oversold. Now Undervalued.

Recommendation: Huntsman has been in the news recently as the private equity firm Apollo that originally agreed to buy the firm is backing out. The stock has plummeted over 40% today according to CNBC. Highly irrational move.

Analysis:

• Huntsman is a solid company with innovative products. Primarily a chemicals and material company, it invented the foam container now a mainstay in most fast food restaurants.

• It is has been one of the best run companies in America. Its CEO Jon Huntsman is the author of the book ” Winners Never Cheat.” See Amazon.com.

• The company’s IPO price was 23 in 2005. Before Apollo, another firm offered to buy Huntsman’s only to be outbid by Apollo who initially offered 28 dollars. Despite Huntsman admitted claims of lower revenues taking into account poor market conditions chemicals remain one of the most stable of industries.

Prediction:

Huntsmann currently trades at 12.71. Ticker (HUN). The PE is NA. Expect it to reach 16 by December 19, 2008.

Capstone Turbine: Its Time Has Come

Recommendation: The recent spotlight on oil now moves to another commodity that the world will soon demand more of : water. Capstone Turbine stands to benefit from this with its core products centered around hydro-electric and water power.

Analysis:

• The blog 24/7 Wall Street had an interesting story around the Fortune article on T. Boone Pickens. Apparently, while Pickens is still a big fan of oil he believes that water is where the next jackpot is.

• Water rights around the world seem to be simmering up to the scale of potential global conflicts according to an article in the Economist. Furthermore, the Tsunami of 2005 and the floods of 2008 in Iowa suggest any natural disaster can have a dangerous impact on clean drinking water.

• Capstone has yet to record a profit. However, its recent financial quarter suggests it is reaching ever closer to achieving that goal with a backlog increase of 458% from the previous year. 24/7 Wall Street notes that the stock is up over 200% since November. Yet, it still has room to grow.

Prediction:

The stock currently trades at 3.99. Ticker (CPST). The PE is NA. Expect it to reach 5.00 by December 18, 2008.

Emcor: Watch This Sleeper Stock

Recommendation: Emcor, whose main focus lies in facilities management, will benefit in the months and years from new interest by companies in energy saving solutions.

Analysis:

• The company recently ran a full page ad in Fortune Magazine touting the fact that it was the recipient of the EPA’s “2007 Project of the Year Award.” The award was granted for turning a PA landfill gas into clean natural gas which then was turned into electric power capable of reducing greenhouse emissions.

• Alternative fuel sources are the talk of Wall Street. Research Recap has an interesting excerpt from a Forrester Report which sees 20% growth by 2011 for Biofuels.

• The company in February 2008 tallied up its 50 consecutive quarter of profitability according to its website. It has been the winner of several contracts in the month of June 2008 alone.

Prediction:

The stock is currently trading at 27.90. Ticker(EME). It has PE of 12.90. Expect it to reach 33 by December 17, 2009.