U.S. government proposes lower than expected Medicare rates. Humana downgraded by S&P, shares tumble.

HUM shares fell 25% on Monday after Medicare rate increases for 2010 were lower than analyst expected. As mentioned in the February 5th “Humana 4Q Earnings” post, Humana is particularly vulnerable to changes in government policy. Projections for Medicare Advantage, the company’s catalyst for long-term growth, will have to be altered to account for the lower rates. Should the preliminary payment rates become final, the company will be forced to either increase premiums or cut benefits to maintain projected profitability, which may cause customers to abandon the programs. Most analyst agree that the actual rates may be slightly more favorable, however it is important to consider Obama’s call for health-care reform.

"The cost of health care has weighed down our economy and our conscience long enough. So let there be no doubt, health-care reform cannot wait, it must not wait and it will not wait another year,"

HNZ 3Q09 Eanrings 2/24/09-James Fowler

Heinz announced yesterday that 3Q09 EPS rose 12% to $0.76. This earnings growth reflects increased pricing, their decision to hedge translation exposures on key currencies, and higher organic sales of brands such as Heinz Ketchup and soup, and Classico pasta sauces. Net income grew 11% to $242M, due to favorable mark-to-market gains, as well as a lower effective tax rate of 26%. Organic sales grew approx 2% while unfavorable foreign exchange rates of 11.4% caused net sales to decrease 7.5%. Organic sales in emerging markets grew 9%, but decreased to 3.2% after the negative FX impact. Operating cash flow during the quarter increased 25% to $233M which reflects effective working capital management and tight control over capital spending.

Heinz reported a sound quarter during a challenging economics times. The results of the quarter reflect my original thesis of people staying in to eat more meals at home. Even during these tough times the Heinz brand ketchup showed organic growth which indicates that people are less willing to trade down to a value brand, at least for ketchup. Although the price increases came at the wrong time coupled with lower volumes, I still think Heinz is going to benefit from more consumers remaining at home to eat. HNZ seems to be in great shape and is also making great progress in emerging markets. Sentiment is to hold the position. Price target-$45 to $50

CHK posts $866 million 4th quarter loss on massive asset writedown

CHK reported earnings for the fourth quarter of -$866 million, primarily due to weak natural gas prices that caused a $1.73 billion writedown on the value of their energy reserves. Management predicts that rig counts will bottom out during the first half of 09' at 105-106. Before the impairment charge, CHK reported revenues of $,2981 billion, a 43% increase YOY.

Despite the massive write-down, I believe that CHK is still the leader in its peer-group due in part to their asset monetization strategies and their exceptional hedging (80% of 09 est. production hedged at above $7 per mcfe). Demand for natural gas will continue to slump during the first half of 09' however, as the economy recovers and commercial demand for natural gas increases, CHK should benefit nicely. Current price target - $37.97

NVDA Manufacturer Rumored to Unveil Tegra Prototype Next Week

Michael Rayfield, general manager of Nvidia's mobile business unit, disclosed that a manufacturing prototype Mobile Internet Device (MID) may be unveiled at Nvidia's booth in Barcelona at the Mobile World Congress conference, which starts next week.

The article details that Nvidia-based Tegra chips could find their way into MIDs on sale for $99 with up to 15 hours of battery life. High definition video playback capability will make the Tegra chipset that more appealing.

Source: http://www.forbes.com/feeds/afx/2009/02/15/afx6054585.html

ITW - Operating Revenue Falls 15% but Reaffirms Guidance

ITW said Monday, its base revenues slid 16 percent on weakness in North America, Europe and Asia. The company posted a 6 percent decrease in contributions from currency translation. Acquisitions helped revenue by 7 percent in the period.

ITW did reaffirmed its first-quarter and full-year 2009 guidance. For the full year, ITW anticipates earnings in a range of $1.84 to $2.48 per share. The guidance assumes a sales decline of 6 percent to 12 percent.

NVDA F4Q09 Earnings 02/10/2009-(Daren Pon)

Nvidia reported annual revenue of $3.4 billion, a 16% year-over-year decrease, while fourth quarter revenue was down 60% year-over-year at $481.1 million. Nvidia realized a net loss of $147.6 million, a GAAP loss of 27 cents a share. Excluding special items, non-GAAP loss per share of 18 cents was worse than the street expected 11 cent loss. Nvidia shares were down today from $8.57 to $8.15, a 12.55% loss for the day following yesterday's drop of 7.2% in after-hours trading.

Cash, cash equivalents, and marketable securities was down $49 million to $1.26 billion. Nvidia regained market share in its core high end desktop GPUs, but overall desktop GPU demand was soft with growth dropping 34%, coupled with trends to more integrated graphics solutions in laptops, leading to discrete laptop GPU a growth decline of 63%. During the conference call, CFO Marvin Burkett stated "Today we can’t say confidently when and by how much revenue will increase. We can only say that we currently don’t see further declines and our outlook is for flat to slightly up revenue for the first quarter."

Despite the financial turmoil Nvidia has experienced over the past couple quarters, I still believe that it is a strong company with a lot of long-term potential. Their most recent technological advancements have placed them the forefront of parallel computing with CUDA, a platform that can accelerate computationally intensive tasks up to 100x over CPUs and that is being taught in over 100 universities globally. Likewise PhysX presents a very tangible advantage for Nvidia GPU cards over AMD/ATI, or will at the very least lead to licensing revenues. They seem to be aware of the cannibalization of notebook GPU revenues caused by netbook and handheld sales, and have better positioned themselves with their ION and Tegra Solutions. That being said, it is never easy to see such significant loses, but Nvidia still has the ability to turn things around, highly dependent on the success of their vision for the future of computing.

DD Commits to 5 year earnings growth outlook-Ed

See below link for details
http://biz.yahoo.com/ap/090210/dupont_outlook.html?.v=2