"Buy The Ticket, Take The Ride"

Stocks still cheap? S&P P/E is 19x trailing 12 months earnings, fairly high. However, 13.5x 2010E EPS, the lowest since 1989. So if you believe the economy can recover in 2010, stocks are still cheap – “trough earnings?”

KFT/Cadbury deal- didn’t happen, but are we getting back to M&A Mondays?

PALM: rumored to cut price to $150. Many stories out there that sales of Pre are collapsing and return rates are as high as 35%. App store still nascent. Pali research says sales “remained stable” over the past week. Only about 4M app downloads.

MGM interview with CEO J. Murren notes: CityCenter opens 12/16/09. MGM will lower prices on condos in Oct. 70% of units are “sold” and 75% of those will close at the new lower prices. Trying to exchange more debt, if that fails will look at other options, but bought 2 years. In May, knew the company was going to survive. Phil Ruffin’s buy of Treasure Island may have “saved MGM.” Murren expects visitation to Vegas to be up 5-10% in 2010, still down this year, but getting better.

Week ahead: big Citi technology stock conference starts Weds. AAPL iPod event Weds. AC and Vegas gaming data out on Thurs or Fri. Comscore search data on Fri.

Junk bond mega-rally: Baa corporate yields are at 6.58%- same as the credit-boom levels of 2004-2007.

IBD says ave life of PC hardware at SMB enterprise is +26% to 50 months, up from 40 months. 56% plan to buy new hardware in next 6 months.

GPS: another one…CS raises to outperform.

Harrahs: plans to issue $720M of senior secured notes due 2017 in a private offering. Shows how much more lenient credit markets are – even this nearly bankrupt company can do a debt deal. Same indenture as the 11.25s2017 issued on 6/10/09.

Penny slots: the new hot thing. In 2000, there were 540 penny slots in all of Nevada, now there are 37,943. Due to technology, and coinless machines. Revenue was $1.8B on penny slots, 25% of total $7.2B slot machine win last year.