Dividend.com: When Brokers Attack
09/05/08 - 03:20 PM EDT
Tom Reese and Paul Rubillo
Broker Battle Begins, Goldman Says Time to Sell Merrill Lynch Shares
The battle of the Wall Street titans is heating up. Goldman Sachs(GS Quote - Cramer on GS - Stock Picks) has put out a note to investors that it is time to dump shares of Merrill Lynch(MER Quote - Cramer on MER - Stock Picks).
Goldman is saying that Merrill Lynch is trading at the highest price-to-book multiple in the large-cap brokerage space, despite having some of the most significant exposures to troubled assets such as collateralized debt obligations, mortgages, and leveraged loans. Merrill Lynch has gone through more than $46 billion in writedowns since last summer.
We have been negative on Merrill Lynch since our coverage began, and we recently removed Goldman Sachs from our "Recommended" list, due to the company's lagging performance, as well as concerns about the financial sector in general.
Goldman Sachs is not a recommended dividend stock at this time, holding a Dividend.com rating of 3.3 out of 5 stars. Merrill Lynch is not a recommended dividend stock at this time, holding a Dividend.com rating of 2.9 out of 5 stars.
National Semiconductor Sees Better Margins This Quarter
National Semiconductor(NSM Quote - Cramer on NSM - Stock Picks) is out with first quarter earnings that saw sales drop 1% to $466 million. EPS came in 1 cent below Thomson Reuters estimates of 34 cents per share for the quarter.
Gross margin of 66.0% in National's first quarter of fiscal 2009 set a new record for the company and was up from the 65.9% gross margin achieved in the fourth quarter of fiscal 2008. Gross margin was considerably higher than the gross margin of 63.0% reported in the first quarter of fiscal 2008. Management credits strong manufacturing performance and cost efficiencies as well as improved product mix of higher-value analog products.
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