Companies featured in this edition of the newsletter: CUR, DKAM, HYTM, IWEB, PHC
Markets finished the last week of 2009 moderately in negative territory, as it was a quiet week that saw the absence of many major market participants and almost no sizable moves to speak of until a sell off late in the day on Thursday led the major indices into negative territory to finish the year. All told, the Dow surrendered 92 points to close at 10428, down 0.9% on the week, but finishing the year up 18.8%. The Nasdaq lost 0.7%, continuing its outperformance relative to the rest of the major indices, closing at 2269 while finishing the year up a healthy 43.9%. The S&P 500 and Russell 2000 finished the week down 1.0% and 1.4% respectively, ending the year up 23.5% and 25.2%.
The most significant story on the week was the lack of developments; volume was anemic throughout much of the week’s session with many investors taking advantage of the holiday season. Markets traded largely sideways for the bulk of the week until late Thursday when indices dipped sharply, largely due to the lack of market participants to absorb end of the year tax selling. In economic news, Consumer Confidence figures posted a slightly better than expected showing for December, perhaps suggesting a surprise waiting for the market in the form of better than expected holiday retail numbers when investors return to work in the new year. On the labor front, weekly initial jobless claims continued their slide, dropping to 432,000 from 454,000 the prior week, and handily beating consensus estimates calling for 460,000 jobs to be shed; both economic developments were largely ignored by the broader market, as the positive news failed to provoke a reaction due to the lack of market participants.
What should investors look for this week? Earnings reports pick up slightly; on Wednesday morning, look for results from Family Dollar (NYSE: FDO), and Monsanto (NYSE: MON), followed that afternoon by Bed Bath & Beyond (NYSE: BBY).
Economic releases for the week begin with Construction Spending for November and ISM Index for December released together at 10:00am on Monday. On Tuesday, Factory Orders and Pending Home Sales for November will be released at 10:00am, followed at 2:00pm by Truck and Auto Sales for December. On Wednesday, Challenger Job Cuts for December are due to be released at 7:30am, followed by ADP Employment for December at 8:15am, ISM Services at 10:30am, and weekly crude inventories at 10:30am. On Thursday morning, labor market data will be released which will most likely be sharply at the forefront of investors’ attention: look for weekly initial jobless and continuing claims, due out together at 8:30am. Average Workweek, Hourly Earnings, Nonfarm Payrolls and the Unemployment Rate, all for December, will be released at 8:30am, followed at 10:00am by Wholesale Inventories for November at 10:00am and Consumer Credit for November at 3:00pm that afternoon.
Conference schedules pick up this week as well. On Wednesday, Pritchard Capital Partners will hold its two day Energize Conference in San Francisco, along with the Citi Global Entertainment, Media, and Telecommunications conference, which is also being held in San Francisco. Goldman Sachs will host their CEO Unplugged Conference in New York that same day.
With New Year’s being a time for resolutions, we thought we would highlight two healthcare services companies which could benefit from meeting objectives that they expressed a high confidence level in attaining. PHC, Inc. (NYSE AMEX: PHC) stated that it expected to receive receiving CMS Medicare certification at its Seven Hills Facility in Henderson, Nevada, which could increase census. The company comes off several quarters of improved operating results, as Seven Hills and its Capstone Facility in Michigan have contributed to stronger revenue growth, as well as GAAP profitability. Shares surged 8% on Friday on twice average volume to close at $1.13.
Could this be the year that healthcare services company Hythiam, Inc. (NASDAQ: HYTM) finally lands a managed care deal? The company inked a deal during the second half of the year with Ford Motor Company, perhaps suggesting that its Catasys offering is beginning to gain traction. HYTM said it expected to begin to recognize revenue from the agreement during the first quarter of this year. Shares ended the week at $0.44, down 1 cent.
Neuralstem (AMEX: CUR), a company targeting major central nervous system diseases using neural stem cells of the human brain and spinal cord, announced in a regulatory filing last week that it had completed a private placement transaction in which it received $1.5 million in gross proceeds; CUR sold 646,551 shares to one accredited investor at a price of $2.32 per share. The company will file a registration statement covering the resale of the shares by March 21, 2010. Shares gained seven cents on the week to close at $1.79.
Drinks Americas Holdings (OTCBB: DKAM), a company that develops, owns, markets, and nationally distributes alcoholic and non-alcoholic premium beverages associated with renowned iconic celebrities, announced last week that it will hold a conference call on Tuesday, January 26, 2010 at 11am to discuss its fiscal 2010 second quarter. The company also plans to provide an update on its 2010 fiscal third quarter, in addition to commenting on progress in the execution of its business strategy. The company recently announced its intention to expand internationally, and has shipped new orders to distributors in Ontario, Canada and Israel. Shares remained unchanged on the week at just over a penny.
IceWEB (OTCBB: IWEB), a leading provider of purpose built appliances and building blocks for cloud storage networks, announced last week that Canadian Health has deployed IceWEB high performance Graphic Information System (GIS) technology to track the spread of the H1N1 swine flu. The company also issued a letter to shareholders last week highlighting its goals for the upcoming year and plans to continue to expand shareholder value through a number of different avenues. Management plans to continue the growth of its sales channel worldwide by marketing its IceWEB and Iplicity brands synonymously with cloud storage computing while further enhancing its customer service operations. The company also plans to continue to extend protection around its intellectual property and has indicated that it expects to provide updates on research, development and patent protection efforts in coming weeks and months. IWEB also announced its intention to grow revenue to $25 million within the next 24 months with profit margins of 60%, which it expects will be attainable as a result of its current product mix, customer base and partner network. Shares remained unchanged at just over $0.12 on the week.