Constellation Brands Drop on 2009 Outlook

Constellation Brands

(STZ) - Get Report

are down more than 6% today after the company said its third-quarter earnings fell to $83.5 million, or 38 cents a share, from $119.6 million, or 55 cents a share, in the year-earlier period.

The world's biggest winemaker said sales results were hurt by currency exchange rates as well as the impact of the economic downturn on its key markets.

The company is narrowing its 2009 forecast to a range of $1.68 to $1.72 per share, below its prior forecast range of $1.68 to $1.76 per share.

Shares of Constellation were down over 30% in 2008. The winemaker has technical support in the $10 to $11 price area. If that fails to hold, the $6 to $7 area could come into play. If the shares can stabilize and begin to move up, the first area of overhead resistance would come at the $18 to $20 levels. We do not currently rate this non-dividend paying stock, but we would look elsewhere for better investment opportunities.

Constellation Brands does not currently pay a dividend.

Monsanto Shares Up 14% After Trouncing First-Quarter Results

Monsanto

(MON)

shares are up 14% Wednesday after the company reported profit that rose 54% to $1.6 billion, or $1 a share, from $1.04 billion, or 46 cents share, in the year-ago period.

Management sees a strong start to the Latin America season, which is an enormous positive, and believes this can lead to the making of a premium corn seed business there. The company's seeds and genomics units grew profit by about 37% to $678 million on sales of $1.1 billion, up 21% from the fiscal first-quarter 2008.

The company raised full-year guidance to a range of $4.40 to $4.50 a share, compared to the $4.20 to $4.40 a share outlook provided in October.

We had removed shares of Monsanto from our "Recommended" list back on Aug. 5, when the stock was trading at $106.95. The company has a 1.31% dividend yield, based on last night's closing stock price of $73.46.

We like the results and are closely reviewing the shares for a potential upgrade to our "Recommended" list. We'll keep our readers posted. The stock has overhead resistance in the $93 to $94 price area. Technical support on the downside is in the $67 to $71 area.

Monsanto is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.

Microchip Technology Warns About Sales for the Third Quarter, Cuts Salaries

Microchip Technology

(MCHP) - Get Report

warned late Tuesday that third-quarter sales would drop 29% to 31% from the preceding period.

The company's CEO says that economic and semiconductor industry conditions have continued to decline since its October earnings call. The company said it is continuing with a pay cut for all of our worldwide non-manufacturing employees, which was implemented during the December quarter.

The company is now forecasting 21 cents to 24 cents for the quarter, which is below the consensus estimates of 32 cents.

We removed shares of Microchip Technology from our "Recommended" list back on Nov. 12, when the stock was trading at $21.23. The stock had been put on the list at a prior price of $23.15. The company has 6.8% dividend yield, based on last night's closing stock price of $20.01.

The stock does have technical support in the $14 to $15 area. If the shares can stabilize a bit and move higher, the $22 to $25 level would be an area for overhead resistance. For now, we would wait to see how the market reacts here, before considering any ratings move.

Microchip Technology is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.

Intel Warns Again

Intel

(INTC) - Get Report

just announced it will miss its previous outlook because of ongoing weak demand and inventory reductions by its PC maker customers.

The company now sees revenue of $8.2 billion, which is below the $8.74 billion it guided down to in November. The company also disclosed that it will be recording a loss from equity investments of $1.1 billion to $1.2 billion, due to the charge from Clearwire. This is way above its previous forecast loss of $50 million from equity investments.

We had mentioned in a previous post that Intel warnings tend to come in bunches and this is number two for warnings if you are keeping track. We had removed shares of Intel from our "Recommended" list back on Sept. 9, when the stock was trading at $20.97. We had added the stock on our "Recommended" list back in early August when it was at $23.

The company has a dividend yield of 3.64%, based on last night's closing stock price of $15.37. We will be watching the market's reaction closely as many like to scale in every time Intel's dividend approaches the 4% level.

Intel is not recommended at this time, holding a Dividend.com Rating of 3.2 out of 5 stars.

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At the time of publication, the author had no positions in stocks mentioned, although positions may change at any time.

Tom Reese and Paul Rubillo are senior editors of Dividend.com. Visit Dividend.com for more dividend stock ratings, picks, news, and analysis for long-term and income-seeking investors.