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Beacon Research Issues TraderNotes on CFC, AKAM, AUY, ACTC, AMCP for January 14, 2007

Today’s TraderNotes include: Countrywide Financial Corporation (NYSE: CFC), Akamai Technologies, Inc. (Nasdaq: AKAM), Yamana Gold, Inc. (NYSE: AUY), Advanced Cell Technology, Inc. (OTCBB: ACTC), AmCOMP Incorporated (Nasdaq: AMCP)

 

Countrywide Financial Corporation (CFC) TraderNote – CFC To be Purchased by Bank of America at $4 Billion

 

Countrywide Financial Corporation (CFC) closed last Friday at 6.33, a negative change of 1.42 or a decrease of 18.32% from the previous close of 7.75.  Countrywide Financial Corporation is a holding company which engages in mortgage lending and other finance-related operations. The company operates in five segments: Mortgage Banking, Banking, Capital Markets, Insurance, and Global Operations. Recently, Bank of America agreed to buy Countrywide for $4 billion, with the deal expected to close in third quarter, pending necessary approvals. Shareholders of Countrywide will receive 0.1822 of a share of BofA, for a deal value of roughly $7 a share or about 0.25X Countrywide's current book value.  Assuming housing prices worsen, they still consider it a good price for Countrywide's shareholders despite the discount, as the company's book value would likely deteriorate.  With the liquidity issues faced by Countrywide, the company was in need of a cash infusion.  In last Friday’s daily chart, RSI indicator reflects a reading of 36.74, a bearish signal for the stock after touching its 52-week low of 4.43 last January 9.  Share prices last Friday made a 50% retracement of the weekly range of 4.43-8.91.  If prices stay above the 6.00 psychological support level, the next level to watch is the 9.00 and 10.00 psychological resistances.  MACD is still in the negative zone, with the 12-day EMA at -1.177 and 26-day EMA at -1.033, and histogram reading at -0.144.  Slow Stochastics indicator, however, signals an oversold condition with %K at 40.37 and %D at 26.59, up from a recent crossover with the 20% threshold, to signal a buying move in the near-term. 

 

 

Akamai Technologies, Inc. (AKAM) TraderNotes – AKAM Finding Momentum in Trading With Its Network of More than 4,000 Servers

 

Akamai Technologies, Inc. (AKAM) closed last Friday at 27.52, a negative change of 0.51 or a decrease of 1.82% from the previous close of 28.03.  Akamai Technologies, Inc. provides services and solutions for digital media distribution and storage, content and application delivery, application performance services, on demand managed services, and Web site intelligence. The company offers three business solutions: Digital Asset Solutions, Dynamic Site Solutions, and Application Performance Solutions. Its Digital Asset solutions include Akamai Media Delivery solution, which provides a solution to various challenges of media delivery over the Internet; Akamai Electronic Software Delivery solution; and Akamai EdgeSuite Delivery solution, which provides worldwide delivery, load balancing, and storage of content and applications. The company's Dynamic Site solutions accelerate business-to-consumer Web sites that integrate collaborative content and applications into their online architecture.  Its Application Performance solutions combine services and features that are designed to improve the performance of dynamic content common on corporate extranets and wide area networks.  Akamai is a supplier of content-delivery networking (CDN) services to Web sites.  AKAM is finding momentum in trading as the company has built a network of more than 4,000 servers to deliver media files to Internet operators.  Akamai has a contract and 9-year relationship with Apple to deliver content.  Last Friday's daily chart for AKAM indicates a strong bearish signal reflecting a triple-top formation to suggest a selling move.  RSI indicator reflects a reading of 24.97, bearish with no confirmation of an oversold condition.  MACD is likewise in the negative zone with the 12-day EMA at -2.008 and 26-day EMA at -1.236 and histogram reading at -.0773, bearish signal in the near-term.  However, the slow Stochastics indicator indicates an almost oversold condition with %K at 16.80 and %D at 12.63, to signal a buying move upon confirmation with a crossover of the 20% level upwards.   

 

 

Yamana Gold, Inc.  (AUY) TraderNote – AUY Hit Its 52-Week High At 16.67 In Last Friday's Trade

 

Yamana Gold, Inc. (AUY) closed last Friday at 16.40, a positive change of 0.10 or an increase of 0.61% from the previous close of 16.30.  Yamana Gold, Inc. engages in the acquisition, financing, exploration, development, and operation of precious metal mining properties in Brazil, Argentina, Honduras, and Nicaragua.  It primarily produces gold. The company owns, or holds interests in, and/or operates various properties principally comprising the Sao Francisco, Sao Vicente, and Fazenda Nova/Lavrinha properties, as well as the Chapada copper-gold project, the Fazenda Brasileiro gold mines, and the Jacobina gold mine in Brazil. It also owns or holds interests in the San Andres gold mine and prospective exploration grounds in Honduras, the Gualcamayo gold project in Argentina, and prospective exploration concessions in Nicaragua.  During last Friday's trading, almost all technical indicators for AUY are pointing north, with its 52-week high at 16.67 hit during the session.  AUY’s RSI indicator is in the positive zone of 72.20, indicating a strong bullish signal, while MACD indicator likewise is in the positive zone, with the 12-day EMA at 0.772 trading above the 26-day EMA at 0.377, indicating a strong bullish signal with the steep curve of lines directed upwards.  Slow Stochastics is also in the positive zone with readings of 97.12 %K and 94.50 %D, indicating a strong buying signal with no indication of an overbought condition.

 

 

Advanced Cell Technology, Inc. (ACTC) TraderNote – ACTC Boosted by Its Five Newly Developed Human Embryonic Stem Cell Lines

 

Advanced Cell Technology, Inc. (ACTC) closed last Friday at 0.24, no change from the previous close. Advanced Cell Technology, Inc., a biotechnology company, engages in the development and commercialization of human stem cell technology in the field of regenerative medicine in the United States. The company primarily focuses on cellular reprogramming, reduced complexity program, and stem cell differentiation research programs. It plans to develop and commercialize products for use in treatment of an array of chronic degenerative diseases and in regenerative repair of acute disease, such as trauma, infarction, and burns.  The company recently announced that the National Institutes of Health (NIH) has awarded the company a SBIR Phase 1 Small Business Grant, which will be used by the company to conduct research that will allow for rapid labeling and purification of specific lineage restricted cells (LRCs) in cultures of differentiating human embryonic stem cells.  In last Friday's trading, share prices made a 30% retracement of its 66.67% increase last Thursday after a report on the five human embryonic stem cell (hESC) lines developed without the destruction of embryos, which have the potential to end the debate regarding the use of embryos to derive stem cells, and which was referred to the President by NIH report as one of the viable alternatives to the destruction of embryos.  In Friday's daily chart, RSI indicator reading is in the positive zone of 62.84, indicating a bullish signal for the stock, a strong recovery from the 52-week low of 0.13 registered last Jan. 4 and again last Jan. 9 and 10, to establish a significant support level or buying entry point for the stock.  MACD indicates a weak bullish signal with the histogram reading above the 0.00 level at 0.011, but with the 12-day and 26-day EMAs both below the 0.00, with readings at -0.007 and -0.018, respectively.

 

 

AmCOMP Incorporated (AMCP) TraderNote – AMCP Entered Into an Agreement and Plan of Merger With Employers Holdings and Sapphire Acquisition

 

AmCOMP Incorporated (AMVP) closed last Friday at 12.01, a positive change of 3.26 or an increase of 37.26% from the previous close of 8.75.  AmCOMP Incorporated, through its subsidiaries, operates as a property and casualty insurer in the United States. It specializes in providing workers' compensation insurance products. The company offers insurance coverage for the statutorily prescribed wage replacement and medical care benefits for employees who are injured in the course of their employment. Its loss prevention specialists provide various services, including identifying and eliminating unsafe working conditions, accident and illness prevention, safety awareness training, and sound employee hiring practices. The company's claims management services comprise return-to-work programs, case management by teams of registered nurses and experienced claims adjusters, and management of medical provider services and billings. AmCOMP Incorporated markets and sells its products through independent insurance agents.  Recently, AmCOMP Incorporated entered into an Agreement and Plan of Merger with Employers Holdings, Inc., a Nevada corporation and Sapphire Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Employers Holdings ("Merger Sub"), providing for the acquisition of  AnCOMP by the latter.  In last Friday's daily chart, almost all indicators are in the positive zone after the announcement, with AMCP's RSI at 76.90, indicating a strong bullish signal with the line curved steeply upwards with no indication of an overbought condition.  The same chart also reflected a wide technical gap formed by last Thursday's close at 8.75 and last Friday's open at 12.11, indicating a strong bullish signal initiated by the upward reversal.  MACD is likewise positive with histogram reading above the 0.00 level at 0.186.  Slow Stochastics is also positive with a recent rise of the %K at 35.24 from a level below the 20% level to indicate an oversold condition or a  buying signal in the near-term.   

 

 

Beacon Equity Research Disclosure

 

The analysts contributing to this report do not hold any shares of the companies covered in this report.  Additionally the analysts contributing to this report certify that the views expressed herein accurately reflect the analysts' personal views as to the subject securities and issuers. The analyst(s) writing this report recognize and aspire to all of the CFA Institute Guidelines for Independent Research. Beacon Equity Research (“Beacon”) certifies that no part of the analysts' compensation was, is, or will be, directly or indirectly, related to the specific recommendation or views expressed by the analysts in the report. Beacon Equity Research has not been compensated by any of the companies covered in this release.  This report is based on data obtained from sources we believe to be reliable, but is not guaranteed as to accuracy and does not purport to be complete. As such, the report should not be construed as advice designed to meet the particular investment needs of any investor. Any opinions expressed herein are subject to change.
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