My finance view

The National Football League is the golden child in the world of professional sports. It has the best media deal, highest TV ratings and most lucrative revenue sharing pacts.

Now, its seems the NFL and Arizona Cardinals are avoiding (at least for now) the state's immigration fight over Senate Bill 1070.

There are no indications there will be SB 1070-related protests today at University of Phoenix Stadium for the Cardinals preseason opener against the Houston Texans.

Groups opposed to the immigration law are not planning any major protests at the Glendale stadium. The immigration issue has caused for some headaches for the Phoenix Suns and Arizona Diamondbacks in downtown Phoenix.

Hispanics groups opposed to 1070 want Major League Baseball to relocate the 2011 All-Star Game out of Chase Field. D-backs owner Ken Kendrick says he's personally opposed to 1070 but critics of the bill don't like that he gives to Republicans (some of whom back the measure).

A few blocks down the street Suns owner Robert Sarver and guard Steve Nash came out against the law and then wore 'Los Suns' jerseys once during the playoffs in the early days of the immigration controversy. The move earned grief from fans who like the law or don't want sports team being political, but accolades from 1070 opponents. The Cards actually got some ticket calls from a few fans irked by the Suns stance and political move.

The bill was signed in April during the NFL offseason and the team has steered clear of the debate. That's not to say the 1070 fight won't pop up later in the regular season. The Cards do have some nationally televised games and were in the playoffs the past two years.

But at least for now, it appears the immigration fight is avoiding the NFL team as it enters a crossroads season on the field and for its growing and somewhat bandwagon fan base. That fan base includes includes plenty of working class whites more friendly towards 1070, and Hispanics averse to the law.

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Kinetic Concepts Inc. was the only local stock to have a positive day on the market Friday.

The company’s stock closed at $37.04, up 0.14 percent from the end-of-day trading on Aug. 6.

Fifteen local stocks declined in value at the close of trading on Thursday, compared to Aug. 5.

After a triple-digit drop early in the day as the market reacted to a disappointing jobs report, the Dow Jones Industrial Average recovered late in the session to close down just 21.42 points, or 0.2 percent, at 10,653.

Friday’s closing tally:

• Abraxas Petroleum Corp.’s (NASDAQ: AXAS) — $2.84, down 2.07 percent.

• Alamo Group Inc.’s (NYSE: ALG) — $24.33, down 0.69 percent.

• CC Media Holdings’ (Pink Sheets: CCMO) — $6.5, down 2.99 percent.

• Cullen/Frost Bankers Inc.’s (NYSE: CFR) — $54.33, down 1.88 percent.

• GlobalSCAPE Inc.’s (AMEX: GSB) — $2.81, down 1.40 percent.

• Harte-Hanks Inc.’s (NYSE: HHS) — $10.90, down 1.54 percent.

• Kinetic Concepts Inc.’s (NYSE: KCI) — $37.04, up 0.14 percent.

• NuStar Energy LP’s (NYSE: NS) — $59.77, down 0.25 percent.

• NuStar GP Holdings LLC’s (NYSE: NSH) — $30.42, down 1.07 percent.

• Pioneer Drilling Co.’s (AMEX: PDC) — $6.68, down 1.47 percent.

• Rackspace Hosting’s (NYSE: RAX) — $19.31, down 1.48 percent.

• Rush Enterprises’ (NASDAQ: RUSHA) — Class A stock closed at $14.56, down 0.88 percent.

• Rush Enterprises’ (NASDAQ: RUSHB) — Class B stock closed at $13.02, down 0.08 percent.

• Tesoro Corp.’s (NYSE: TSO) — $12.77, down 0.47 percent.

• U.S. Global Investors’ (NASDAQ: GROW) — $5.98, down 2.13 percent.

• Valero Energy Corp.’s (NYSE: VLO) — $18.06, down 1.37 percent.

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Planet Fitness has leased about 22,680 square feet of space at the Charlestown Shopping Center in Kernersville, marking the third company location in the Triad.

YOT Fitness Kernersville LLC, which conducts business as Planet Fitness, leased the space from Greenwood and Charles Inc. and joins Rite Aid and other tenants in the shopping center.

Raymond D. Collins Jr., of Collins Commercial Properties Inc., represented YOT Fitness/Planet Fitness in the Kernersville lease.

Ladd Freeman Jr low rate payday loans., of Freeman Commercial Real Estate, represented Greenwood and Charles Inc. as landlord in the lease.

Planet Fitness in Kernersville is slated to open in the fourth quarter with an initial 15 employees. Other Planet Fitness centers are located in Greensboro and High Point.

Martin Sinozich is principal and managing partner of the three Triad locations.

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Tesla Motors Inc. has shown potential investors "freaking bad ass" plans for electric SUVs, cabriolets and vans to follow its planned sedan.

The potential new models are shown in a road show given by CEO Elon Musk leading up to the expected $185 million initial public offering by the company on June 29. Toyota Motor Corp. has pledged to buy another $50 million in Tesla stock after the IPO.

"Freaking bad ass" is how he describes the variations on the Model S sedan the Palo Alto expects to start making in 2012 at the former New United Motor Manufacturing Inc. plant in Fremont. To see the Tesla IPO presentation click here.

Unlike the company's only existing electric car that it has actually delivered, the Roadster, the sedan and other models shown in the road show would be completely built by Tesla. The sports car body and frame is now produced by Lotus, whose British factory is closing for renovations before Tesla can produce its sedan, causing a gap during which the company will be delivering no cars.

Tesla last week discussed in a blog posting how it plans to build the sedan at the NUMMI plant.

If the Toyota-Tesla partnership proceeds as outlined, the companies could also be producing electric vehicles together in Fremont, with speculation centering on an all-electric version of the hybrid Prius.

Toyota's announcement last week that it plans to restart a plant in Mississippi to build Corollas has fueled further speculation that hybrid Prius manufacturing could happen at the plant the Japanese auto maker abandoned in April. The Mississippi plant had once been touted for Prius production as well.

To read more of the Business Journal's in-depth coverage of Tesla, click here.

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The Business Response Team created by Mayor Karl Dean and the Nashville Area Chamber of Commerce toured flood-damaged businesses Thursday to better understand their needs.

“We’re trying to determine how best we can get businesses helping businesses get back on their feet,” co-chairman Henry Hicks of Gray Line Tours said after a tour of Soundcheck, which provides storage and rehearsal space for musicians and was destroyed by flooding.

The team also met with representatives of Interior Design Services, which is located in the same warehouse facility on Cowan Street near the Cumberland River. Steve Meek, chief financial officer with IDS, said the company could use help figuring out how to insure the company’s space going forward. Soundcheck owner Ben Jumper said he is looking for help from the Mayor’s Office to get occupancy permits fast-tracked.

A separate group of representatives from the Business Response Team toured industrial businesses on Visco Drive. Businesses can visit nashvillebusinessrecovery.org, to inquire about assistance and to find out how to contribute to flood recovery efforts and share resources with businesses in need. See this story for more information.

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Regulators and Wall Street officials went through millions of trades one by one Friday and canceled thousands as they sought to explain a record plunge in the stock market, undo damage and keep it from happening again.

It wasn’t clear how long the laborious process would take or if it would even solve the mystery behind Thursday’s harrowing trading session that saw the Dow Jones industrial average fall hundreds of points and then recover, all in a matter of minutes. The chaotic slide — some stocks briefly fell to near zero — brought back memories of the darkest days of the financial crisis.

The Securities and Exchange Commission and Commodity Futures Trading Commission were investigating, but on the day after, there were more questions than answers:

— Did a single trader mistakenly punch the wrong number of shares when making a sell order, maybe mistyping "billion" instead of "million" and setting off a market-wide panic that at one point pulled the Dow down almost 1,000 points?

— Did high-speed computerized trading systems, supposed to make markets work smoothly, go haywire?

— Most important to anyone with money in the stock market: Could it happen again?

Maybe the scariest part was that no one could unravel what happened. That left executives at the major stock exchanges pointing fingers at one another, and the public wondering if the hidden world of high-frequency, computerized trading that fed the panic posed a threat to their 401(k)s.

"It could be awhile before they figure it out because they have to sift through everything trade by trade," said San Diego State University finance professor Dan Seiver, who has followed the markets for 52 years no fax pay day loan. "And humans are a lot slower than machines."

Market officials worked to cancel thousands of "clearly erroneous" trades made during the plunge.

New York Stock Exchange Euronext CEO Duncan Niederauer told CNBC that his exchange canceled 4,000 trades.

How did it happen? Speculation on trading floors initially centered on a computerized selloff possibly caused by a typographical error. One theory was that a trader trying to sell millions of shares accidentally sold billions, which would have triggered a wave of automatic selling.

The SEC is poring through trading data containing millions of transactions to try to identify what might have caused the disruption, according to two people familiar with the matter. The two major markets, the New York Stock Exchange and Nasdaq, were also examining audits of completed trades, according to the people, who spoke on condition of anonymity because the investigation is ongoing.

At Nasdaq, Thursday’s plunge set off MarketWatch, an internal system that alerts regulators to problems. Regulators are still sifting through the data for irregularities. A Nasdaq spokesman declined to comment.

NYSE spokesman Raymond Pellecchia said the Big Board is working with regulators but declined to comment further.

"Right now, there is no way to know what is happening in this marketplace," Kaufman said.

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Research in Motion posted a fiscal fourth-quarter profit and revenue that missed Wall Street expectations, but the BlackBerry maker’s forecast for the current quarter easily topped analysts’ estimates.

Shares of RIM (RIMM) plunged 5% in after-hours trading after the company reported a profit of $710.1 million, or $1.27 per share. Net income rose 37% compared with a year earlier, but analysts polled by Thomson Reuters were looking for earnings of $1.28 per share.

The Canadian company said it shipped 10.5 million devices and added 4.9 million users during the quarter, driving sales up 18% to $4.08 billion compared with a year earlier, but the figure was below analysts’ estimates of $4.31 billion.

Even as competition intensifies with Apple (AAPL, Fortune 500)’s iPhone and Google (GOOG, Fortune 500)’s Android-based phones, the company maintained its leading role in North America, where the BlackBerry continues to be the top selling smartphone.

And RIM chief executive Jim Balsillie said the company "made great strides in penetrating international markets."

Nearly half of the quarter’s revenue was supported by international sales, he said, and about 38% of new subscribers were from markets outside of North America.

"The fourth quarter results were softer than expected, but the company’s growth in international markets will be a major driver going forward and supports its first-quarter guidance," said Steven Li, analyst at Raymond James.

The company’s cheaper devices, such as the BlackBerry Curve 8520, are strong sellers abroad, but they push the company’s average selling price lower.

But with a new lineup of higher-priced products being introduced in the second half of the year, Balsillie said he is confident in the company’s future growth.

For the current quarter, RIM said it expects to add between 4.9 million and 5.2 million BlackBerry users, driving earning between $1.31 and $1.38 per share, above analysts’ outlook of $1.23. For the three months ended May 29, the company forecast revenue between $4.25 billion and $4.45 billion. Analysts are looking for $4.33 billion.

For the year ended Feb. 27, RIM reported a profit of $2.46 billion, or $4.31 per share, on revenue of $14.95 billion. 

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The complex prescription for successful health care investing usually includes the careful consideration of drug pipelines, current-product sales, patent expirations, potential mergers and stock dividends.

Add to that list in 2010 an untested ingredient called health care reform.

"Institutional investors don’t want to see big headlines about the health care industry that they weren’t able to predict," said Les Funtleyder, health care strategist for Miller Tabak & Co. in New York. "So they’re currently operating on the fear of increased regulation or pricing pressures."

If you’re in any way optimistic that the outcome of health care reform won’t be bad for drug companies, the current fears mean that health care stock prices will never be more reasonable than they are now. Prices are depressed and the dividends solid.

"Once we know what the reform will look like in detail we can then move forward," believes Linda Bannister, health care analyst for Edward Jones in St. Louis. "Managed care is the most at risk from health care reform, and then the risk declines from there."

Beyond the potential negatives of reform on drug stocks there may be some long-term positives.

"If 30 million people who didn’t have health insurance were to have it, imagine what that does for a pharmaceutical company," said James Molloy, pharmaceutical analyst for Caris & Co. in Boston. "The plus side of drugs is that most people with insurance never pay full price, but instead pay a co-pay, and you can imagine what kind of car everyone would drive if they had a co-pay for their gas."

While awaiting a clear prognosis on reform, investors must fall back on traditional considerations that tend to favor big pharma that keeps growing bigger.

Merck & Co., whose stock is flat this year after a 25 percent gain last year, is recommended by Bannister and Funtleyder because its strong product pipeline means it won’t require the endless cutting of costs to be profitable. It faces loss of patents on several key drugs in coming years and fierce competition, yet its financial health is strong and its research excellent.

Merck’s launches of diabetes drug Januvia, papillomavirus vaccine Gardasil and HIV drug Isentress have all been successes, while its acquisition of Schering-Plough could result in $3.5 billion in annual cost-saving synergies by 2012. More than half of Merck’s sales are outside the U.S.

Johnson & Johnson, its stock down slightly this year after last year’s 11 percent rise, has suffered through a period of patent expirations, but Bannister believes its drug pipeline coupled with continued efficiencies should accelerate its growth. It benefits from being the world’s largest and most diverse health-care company, with the top or number-two leadership position in 70 percent of its products.

"I cover mostly smaller names of the world and try to find those with downside protection in the form of some core value," said Molloy.

Warner Chilcott Plc, whose stock is down 8 percent this year after last year’s 96 percent gain, is Molloy’s top pick in part because it has massive cash flow. This marketer of women’s health and dermatology products recently purchased Procter & Gamble’s prescription drug business. Its product mix includes hormonal oral contraceptives and hormone therapy products for menopausal symptoms, as well as topical products for psoriasis and an antibiotic for acne.

The other Molloy favorite is Endo Pharmaceutical Holdings Inc., up 10 percent this year after last year’s 21 percent decline. It is a specialty drug company in pain management whose flagship product is the Lidoderm adhesive patch for post-shingle pain. The company, which cross-sells many of its pain-related products, last year acquired Indevus Pharmaceuticals, which specializes in urology and endocrinology.

"My biggest consideration is whether the good news or bad news is factored into the stock price," explained Molloy. "I also ask whether its primary drug has to be a $1 billion drug for the company’s stock price to go higher."

Novartis AG and Bristol Myers Squibb Co. are Funtleyder’s other favorites. Though he says "no one is firing on all cylinders right now," there is little downside, they offer solid dividends and their upside is the enormous potential of their drug pipelines.

Mergers can come fast and furious among drug companies, but is an unpredictable trend that none of the experts expect will take place soon.

"Pharma has been a consolidating industry ever since it was an industry," said Funtleyder, noting that patent expirations and slowing sales drove the most recent mergers and innovation may someday drive the next go-around. "Consolidation happens in waves and last year was a pretty big wave, so we think there will be a break for a couple of years before we see the next wave of consolidation."

Other Bannister choices include Eli Lilly & Co., Pfizer Inc. and Abbott Laboratories.

"If a company like Lilly is unable to execute its pipeline, then at some point it is going to have to make a sizeable acquisition or it will potentially be acquired," concluded Bannister, who considers investment in Lilly a three- to five-year story. "Yet most of these companies’ strategies are licensing deals or small ‘tuck-in’ acquisitions, so I’m not betting on a new wave of industry consolidation."

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St. Louis University will tap into the large pool of laid-off Pfizer scientists to launch a new research center focused on discovering drugs to treat medical problems in the developing world.

SLU has committed $5 million over the next two years to fund the Center for World Health & Medicine, which will launch in July, Raymond Tait, SLU’s vice president for research, said Wednesday. The school initially plans to hire a dozen soon-to-be former Pfizer researchers.

In November, Pfizer announced it would lay off 600 of its 1,000 employees in St. Louis, part of a 15 percent reduction of the drugmaker’s global work force. The reductions followed Pfizer’s $68 billion acquisition of the drugmaker Wyeth. Pfizer’s main research campus in the area is located in Chesterfield.

SLU began discussions in early December to figure out ways to keep some of those scientists in St. Louis. In a time of strained university resources, this reflects SLU’s commitment to the region, Tait said.

"St. Louis U. worked with uncharacteristic speed," he said. "The initial reaction was a form of horror to think about the impact of (the layoffs) on the St. Louis region. After we had a chance to digest it, we then thought, ‘Gee, this also provides us with an important opportunity that could be transformative for research at St. Louis U.’"

This is a somewhat unusual venture, in that universities have not typically delved into the realm of drug discovery, Tait acknowledged.

"We’re not going to compete with Pfizer and Wyeth," he said. "We’re not going after blockbuster drugs."

Rather, the appealing part of this idea was that the school could follow its Jesuit mission by helping underserved populations, he said.

Steve Johnson, senior vice president of the St. Louis Regional Chamber and Growth Association, said SLU’s move is a small but important step in the right direction if St. Louis hopes to plug the leakage of high-skilled workers to other areas.

There are between 1,700 and 2,000 laid-off scientists and skilled technical workers in the region right now, Johnson said. Keeping them, and their skills, in St. Louis is becoming an increasingly high priority, he said.

"That represents a tremendous amount of talent," Johnson said payday advance. "You don’t want to dehumanize people, but those are marketable assets for the region."

They are the kind of assets that can help lure other big medical and technology firms here, or that can seed startups, or that, as in this case, can help launch research groups at local universities.

"We applaud (SLU’s effort)," Johnson said. "And we’ll be digging into this whole issue and look at what other regions are doing."

SLU still has to hash out many of the details about the new center — such as whom exactly it will hire, where it will be housed, and what areas it will focus on.

"This is still a work in progress," Tait said. "Give us another couple of months where we can flesh out who will be working with us."

While many of the scientists have already vacated their laboratories, they are still under contract with Pfizer, Tait said. So SLU has not yet officially hired anyone, but it has spoken with several people who are very interested in the new center, he said.

Targeting childhood diarrhea is one area that some scientists have expressed a special interest in, he added.

Tait said he hopes the center will be sustained down the line in part through research grants, subcontracting work, and perhaps foundation support.

"We’ll see if we cannot make this viable," he said. "Over time, we suspect we will get some intellectual property, but intellectual property is not the lifeblood."

SLU has already started writing up an application for a federal stimulus-funded research grant at the new center, he said.

Down the line, Tait said, SLU could work with pharmaceutical companies — including, but not limited to, Pfizer.

"I don’t see us undertaking clinical trials," he said. "What I can see us doing is identifying some promising treatment approaches, working to where we have some evidence or sense that they are safe. But in order to bring them to market, we will have to partner."

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Homeowners seeking relief under the Obama administration’s mortgage aid program will be required to provide proof of their incomes upfront, a significant reversal for the problem-plagued effort to stem the foreclosure crisis.

Borrowers had been able to state their income verbally and provide documentation later. Mortgage companies, however, said many borrowers didn’t return the documents.

Only about 66,500 borrowers, or 7 percent of those who signed up, had completed it as of December.

Lenders will now be required to collect two recent pay stubs at the start of the process, the Treasury Department said Thursday. Borrowers will have to give the IRS permission to provide their most recent tax returns, rather than submitting the returns themselves.

The changes become mandatory for loan modifications made starting June 1.

The change in policy came after officials concluded that mortgage companies such as GMAC Mortgage and Ocwen Financial Corp. were delivering better results. They had always required documents up front.

Under the new rules, participating mortgage companies must acknowledge receipt of a borrower’s application within 10 days and approve or deny the application within 30 days. After that, borrowers will still be required to make three months of trial payments before the modification becomes permanent.

While the changes should help, the lack of penalties for companies who don’t comply disappointed some experts. "There’s no teeth to that obligation," said Andrew Jakabovics, associate director for housing at the Center for American Progress, a liberal think tank.

Many consumer groups, meanwhile, have been calling for more dramatic changes. They want to help homeowners who have lost their jobs and those who owe the bank more than their homes are worth.

Treasury officials said they are studying ways to aid unemployed homeowners but offered no details.

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