64 great stocks screened by MS and The GOAL by GS

Bonjour,

Europe set for slight higher start. Asia fell to 3mo low amid European debt concerns. Macro eyes on new US home sales + eurozone industrial new orders as well as German growth forecast.


NFLX
: -16% – 1Q loss per share 8c, est. loss 27c; rev. $870m est. $865.5m. Sees 2Q loss per share 10c- EPS 14c, est. loss 19c; 2Q rev. about $873m-$895m; est. $893.4m. Says due to seasonality, 2Q net adds will be low those of 2010.

TXN: +2.6% – 1Q EPS 22c, Est. 17c. 1Q rev. $3.12b vs est. $3.06b. Sees 2Q EPS 30c-38c vs est. 32c

CURRENT THEMES

The consensus: everywhere is the same story: Crisis in Europe, Hard Landing in China, Stalling US Growth…

On Markets
It’s still ugly out there. While European markets fell sharply on poor flash PMIs and concerns over the French and Dutch politic situation (tried something with Holland and Hollande, but it would clearly lower the quality of my comments). Italian and Spanish bonds sold off, while German bonds rallied.
In the US, the S&P fell 0.84% on these European concerns.

On Central Banks
The FOMC meeting is today and tomorrow and, according to GS, we shouldn’t have a clear hint of further action. The message may be confusiong too with the reiteration of the “late 2014” low rates guidance while projections from participants may look more hawkish.
The Australian CPI came out weaker than expected at 1.6% (YoY) vs 2.2% expected and 3.1% in Q4meaning the RBA will certainly cut rates next week (1st of May).
In Brazil, the Copom may offer new more dovish guidance at the April 18th meeting.
In Japan, the BoJ is expected to ease the policy on Friday, April 27th. The BoJ will publish the semiannual Outlook Report, in which the BoJ board members’ GDP and core CPI outlook will be indicated.

STRATEGY

MS (Secker) European Strategy
A Nifty Fifty+ for Europe
A news screening from MS looking for stocks with strong pricing power, reliable track record, financial strength, sustainable dividend yield, high EM exposure and low developed Europe exposure.
BMW STAMM, PIRELLI & CO, LVMH, RICHEMONT, ADIDAS, WPP, REED ELSEVIER, EUTELSAT COMM., INDITEX, NEXT, NESTLE, AB INBEV, BRIT. AMER. TOB., SABMILLER, DIAGEO, UNILEVER, IMP. TOBAC GRP, SWEDISH MATCH, RD SHELL, BP, ENI, STATOIL, BG GROUP, REPSOL YPF, SAIPEM ORD, SUBSEA 7, STAND. CHART., OLD MUTUAL, FRESENIUS MC, WILLIAM DEMANT, NOVARTIS, ROCHE, NOVO NORDISK, ASTRAZENECA, BAYER, SCHNEID. ELEC., EADS, ATLAS COPCO, ROLLS-ROYCE, SANDVIK, BAE SYSTEMSTOTAL, METSO CORP, SGS, AGGREKO, CAPITA, EDENRED, ASML HLDG, ARM, SAP STAMM, SAGE GROUP, ERICSSON, RIO TINTO, BHP BILLITON, ANGLO AMER., SYNGENTA, LINDE, DSM, VODAFONE, TELENOR, BT GROUP,

GS (Oppenheimer)Global Opportuinity Asset Allocator.
(copied and pasted)
Our macro outlook: Three key drivers of performance We expect three key drivers of performance over the coming quarter: 1) a slowdown in US growth momentum, 2) an improvement in growth momentum in China on the back of looser policy, and 3) continued volatility from the European sovereign situation. Both potential risks and potential rewards in risky assets in the near term have declined compared to last quarter in our view.

Equities: We expect a consolidation phase in the near term and are Neutral. Over 12 months we expect good returns as we anticipate Europe to exit its recession, the European sovereign situation to improve, and growth to stabilize in the US and improve in China.
Corporate credit: We are near-term cautious on spreads, as we believe they have not moved to adequately reflect the renewed rise in European sovereign risks. Over 12 months, however, we expect spreads to narrow.
Government bonds and cash: Government bond yields remain low compared to current macro fundamentals. We see this as the asset class where risk/reward is most clearly skewed to the downside and are therefore Underweight. We balance this with our Overweight in cash over a 3-month horizon, but are Neutral on cash over 12 months.

OTHER STUFF

14 Reasons France Is Under Fire – Business Insider http://read.bi/HY2zsd
Citi’s Englander On What Can Go Wrong In The Next 11 Days? | ZeroHedge http://bit.ly/JmVhyg

EUROPEAN EQUITIES

FINANCIALS
– SEB 1Q net SK2.65b vs est. SK2.6b; 1Q NII SK4.2b; net fees and commissions SK3.3b; op. income SK9.6b; 1Q credit provisions SK206m; 1Q EPS SK1.32 vs est. SK1.19; says that it is ‘navigating in the new regulatory landscape’ and that it sees regulatory changes to have ‘major’ impact on markets
– Nordea 1Q net income €773m vs est. €745m
– Banco Comercial Portugues posts loss of €849m for last year vs €786m loss previously reported; it cites higher impairments related to Greek government bond holdings after deciding to participate in country’s debt restructuring; impairments on Greek debt climbed to €409m vs €346m; Core Tier 1 ratio as of Dec. 31 was 9.3%
EPS estimates for Italian banks are cut by 20% on average to reflect lower loan volumes, pressure on margins from lower Euribor rates and asset quality which may not normalize before 2014, Barclays says
– Bankia says that it changed conditions on 35% more loans in first quarter than a year earlier
– DEUTSCHE BANK policies are to be opposed by an investor group, reports the FT
– Santander has asked investment banks for proposals to list its Mexico unit on the country’s stock exchange in six months to a year, according to the WSJ
– ING GROEP has a 9.79% stake in Royal BAM Group, says Bloomberg
– Overweight UK banks: Top Picks are HSBC and Barclays, Citi says
– Erste preferred to Raiffeisen at Berenberg; it says that capital concerns still biggest factor weighing down their shares; Buy rating unchanged for both stocks; Raiffeisen PT cut to EU30.6 vs EU36.2
– KBC raised to Buy vs Hold at ING, PT raised to EU22.50 vs EU12.50
– Monte Paschi PT cut to EU0.3 vs EU0.4 at Barclays, kept at Equalweight
– UBI PT cut to EU2.9 vs EU3.7 at Barclays, Kept at Equalweight
– Prudential initiated Outperform at Bernstein, PT 980
– Legal & General initiated Outperform at Bernstein, PT 175p
– Aviva initiated Outperform at Bernstein, PT 390
– Old Mutual initiated Market-Perform at Bernstein, PT 175p
– Standard Life initiated Market-Perform at Bernstein, PT 230p
– Resolution initiated Market-Perform at Bernstein, PT 265p

INDUSTRIAL/MINERS/SERVICES
– Umicore 1Q rev. +11% Y/y; Catalysts rev. +18% (UBS +2%); Energy Materials +12% (UBS +3%) ; Performance Materials +4% (UBS +3%); sees recurring Ebitda €520m-€560m; Ebit ex-items €370m-€410m vs est. €422m
– Zodiac Aerospace 1H current operating profit €223.8m; forecasts full-year like-for-like sales growth of at least 10% and current operating margin of at least 14%
– Michelin 1Q sales €5.30b vs Credit Suisse est. €5.44b vs Deutsche Bank est. EU5.04b; price mix improved 13.8%; raw material costs to rise €300m-€350m, plans ‘sustained price management’ in response; sees stabilization of rev. in 2012 and higher op. income
– Faurecia 1Q rev €4.3b vs est. €4.2b; confirms 2012 targets, sees ‘steady growth’ in some markets; European light vehicle output to fall more in 2Q
– Bouygues Construction to build three towers in Thailand in a contract worth €100 million
– MICHELIN raised to overweight at HSBC; PT raised to EU55 vs EU52 at Morgan Stanley, kept at Equalweight
– Nokian PT raised to EU34 vs EU27.4 at Morgan Stanley, kept at Equalweight
– Metso raised to Buy vs Neutral at Swedbank ahead of 1Q
– Getinge AB PT cut to SKr200 vs SKr207 at Morgan Stanley, kept at Overweight
– Lufthansa raised to Overweight vs Neutral at Credit Suisse
– IAG raised to Overweight vs Neutral at Credit Suisse
– Saipem kept at Outperform at Exane, PT unchanged at EU43, outlook remains solid; PT raised to EU52 vs EU48 at Barclays, kept at Overweight
– Unibail Rodamco assumed Outperform at Credit Suisse

UTILITIES/OIL/HEALTHCARE/CHEMICALS
– Essilor 1Q revenue €1.27b vs est. €1.21b; ‘confident’ it will achieve its full-year revenue growth target of 12-15%, excluding currency fluctuations; forecasts ‘sustained high profitability excluding strategic acquisitions’
– Novartis 1Q Pharmaceuticals sales $7.84b vs Credit Suisse est. $7.85b, Jefferies est. $7.76b, JPMorgan est. $7.77b; 1Q Gilenya sales $247m, 1Q Lucentis sales $567m ; 1Q rev. $13.7b vs est. $13.8b; 1Q Core EPS $1.27 vs est. $1.28; confirms 2012 outlook, sees 2012 sales in line with 2011, core operating income margin slightly below 2011; sees bolt-on acquisitions of $1b-$3b
– GDF Suez’s price freezes for power and natural gas tariffs in Belgium through its Electrabel utility will shave ~€100 million from its Ebitda; it does not expect ‘big’ water legislation in France that would take contract responsibilities away from municipalities
– BP has restarted Train 2 at its Tangguh liquefied natural gas plant in Papua today after the earthquake
– Buy Glaxosmithkline as leverage continues to be underappreciated, says Jefferies
– Buy Fresenius SE, as it offers an attractive entry point, Jefferies says
– FRESENIUS MEDICAL CARE rated new overweight at HSBC
– EDF upgraded to Buy vs Hold at Berenberg
– Enel Green Power PT cut to EU2 vs EU2.1 at Goldman, kept at Buy

TMT
– STMicroelectronics reports 1Q sales $2.02b vs est. $2.03b; 1Q adj. loss/shr 14c vs est. loss 5c; billings bottomed in 1Q but bookings improved ‘across the board’; sees 2Q rev. growth ~7.5%, plus/minus 3 percentage points, equal to ~$2.11b-$2.23b vs est. $2.18b ; sees 2Q gross margin ~34.4%, plus/minus 1.5 percentage points
– ST-Ericsson 1Q net loss $312m; sees ‘low double-digit’ increase in 2Q rev. vs 1Q
– KPN reports 1Q sales €3.19b vs est. €3.14b; 1Q net income €288m vs est. €310.5m; 1Q EPS €0.2 vs est. €0.2 ; sees stronger profit and cashflow in 2H; reiterates FY guidance
– Havas 1Q organic growth 3.5%; 1Q sales €387m; says 1Q saw ‘strong performance’ in France
– VODAFONE baulks as India’s phone regulator proposed airwaves fees that may increase license costs for potential bidders by at least 11-fold
– Swisscom PT cut to SFr425 vs SFr460 at Morgan Stanley, kept at Equalweight
– Telenet PT raised 3% to EU32 at Exane, kept at Neutral
– Lagardere raised to Buy vs Underperform at BofA

RETAIL/CONSUMER/LUXURY
– Remy COINTREAU FY organic sales growth up 15.6% vs est. +16.5%; FY rev. €1.03b vs est. €1.02b; 4Q organic sales down 8.3% vs est. down 3.4%; 4Q had decline due to the calendar impact of the Chinese New Year; confirms seeing a ‘substantial increase’ in FY results, with ‘significant double-digit growth’ in current oper. profit
– Unilever will today announce goal of buying all palm oil from traceable, sustainable sources within 8 yrs; it is in advanced talks with Indonesian government on a plant, which would make sustainable palm-kernel oil in Sumatra and provide ~10% of its annual needs, reports the WSJ
– Nestle may sell as much as $1.8 billion of infant-nutrition assets it’s buying from Pfizer amid antitrust concerns in countries such as Mexico, says Bloomberg
Danone, beaten by Nestle in an $11.9 billion contest to acquire Pfizer’s nutrition unit, may have to scale back its expansion ambitions in the baby-food market
– Buy AB Inbev, UBS says ahead of 1Q
– Next to suffer from pressure on top line margin, JPMorgan says; kept at Underweight with PT increased to 2,039p vs 1,948p

SMALL/MIDCAPS
– Portucel 1Q rev. €353m vs est. €365.5m; 1Q Ebitda €93.6m vs est. €92.9m; 1Q net €52.3m vs est. €44m
– Sartorius 1Q sales €208.1m; 1Q Ebita €27.2m; 1Q rev. €208.1m; 1Q adj. EPS 83c vs 62c; reiterates FY sales growth and operating Ebita of about 10%
– CSM 1Q sales €799m vs est. €773m; 1Q Ebita EU29m; on track for more than €30m of cost savings in 2012, but continues to see tough 1H vs 2011 with a challenging trading environment
– Kemira 1Q net sales €552.9m vs est. €557.4m; 1Q net income €28.9m vs est. €31.3m; EPS €0.19/shr vs est. €0.208/shr; sees 2012 revenue and operative EBIT at 2011 level
Buy Neste Oil on ‘undervalued renewables,’ BofA Say
– Thomas Cook PT raised to 25p vs 15p at Morgan Stanley, kept at Equalweight
– TUI AG PT raised to EU9 vs EU8 at Morgan Stanley, kept at Overweight
– TUI Travel PT raised to 180p vs 160p at Morgan Stanley, kept at Underweight
– Gem Diamonds cut to Neutral vs Buy at Goldman
– L’Espresso kept at Outperform at Exane on positive results citing better-than-expected ad sales, PT unchanged at EU1.3

Max Kamir

Louis Capital Markets UK,LLP
Authorised and regulated by the FSA and Banque de France
39-41 rue Cambon
75001 Paris

T +33 (0)1 53 45 10 74
E mkamir
I http://www.louiscapital.com

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