A Boston portfolio manager recommended TTM Technologies (NASDAQ: TTMI, $15.43) as a Buy.  The company’s 2010 acquisition of Meadville, a leading China-based printed circuit board manufacturer, was a transformative event.  The deal immediately gave TTMI a strong presence in fast growing tablet and smartphone markets.  It also significantly enhanced the company’s expertise in new PCB manufacturing technologies such as HDI.  TTMI is one of only 4 vendors supplying HDI boards, with this space projected to grow at a 20% rate going forward.  The company is also able to offer its customers a one-stop solution now, from prototype support to volume production.   The company’s value proposition has  become more attractive as it now has great presence in China, where the global PCFB production has been increasingly moving to.  The stock has sold off recently due to a reduced margin guidance, concerns about Apple, one of its major customers, and negative comments by some players in the networking/communications space.  The presenter believes these are all short-term issues.  The growth in HDI orders will change the margin mix.  At 12x 2012 earnings, the upside is close to 60%.

A San Francisco Portfolio manager recommended AeroVironment (NASDAQ: AVAV, $35.30) as a Buy.  The company has won every DOD contract for drones up until now.  Unmanned aircraft systems remain an area of growth in the defence budget and the company is in a great position to be awarded more contracts by the department.  The company is getting ready to move two new models, Global Observer and Switchblade, to the production phase, with each of these a potentially highly significant catalyst for the stock if the orders start flowing.  AeroVironment’s efficient energy systems business has seen revenues more than double in the last quarter.  Nissan and BMW have selected AVAV to provide home charging docks for their electric vehicles.  Hawaii and Oregon are installing AeroVironment’s charging stations with more states likley to follow.

Health plans (e.g. Aetna, Cigna, United, Blue Cross, and Humana)

With differing business models that could have better or worse positioning under health reform insurance changes, health plans today remain primarily on the defensive. Recent MLR (medical loss ratio) rules are forcing moves toward medical and pharmacy integration around both management and cost. Poor investment returns coupled with slowed economic growth reducing the number of available covered lives premiums have caused personnel down sizing along with internal reorganization. Meanwhile, the market of self insured plan sponsors as well as full insured small businesses are looking for innovation and consistency in health care coverage. The lack of ability to focus on product innovation creates a unique timing opportunity for commercial plan sponsors (large employers) to drive innovation in coverage, reimbursement, and medical and pharmacy plan design before 2013 when health reform may resume post-presidential election.

PBMs (e.g. Medco, CVS/Caremark, ESI, Catalyst)

Riding the current wave of branded drugs patent expiration through 2014, PBMs are in the position of being profitable and successful while at the same time facing the end of their source of profits and success. The emerging biologic (specialty pharmacy) product tsunami from R&D pipelines from 2011 through at least 2018 present a coverage dilemma for health plans and a stone wall against the business model to PBMs. Priced at 100 to 200 times the typical retail prescription today, biologic pharmaceutical products don’t fit the benefit plan design nor management typically employed by PBMs with traditional pharmaceutical products. With virtually no rebates to pass along, high per prescription claim costs, and limited cost sharing—these leave PBMs will a questionable value proposition to private plan sponsors along with the fact the PBMs don’t take financial risk for the pharmacy benefit. Look for more volatility among PBM contracts along with initiatives from PBMs to find a new value proposition to justify their existence.

Drug manufacturers (e.g. Pfizer, J&J, BMS, Merck, GSK, Sanofi Aventis, AstraZeneca, Genentech (Roche), Novartis, Teva)

While making live miserable for health plans and PBMs, manufacturers continue to develop as well as restructure their R&D portfolio in favor of biologic based drugs, devices and relate diagnostics. These new generation products offer more effective outcomes in patient care along with huge increases in drug claim costs that the traditional insurance system had not built to handle. The economic recession has already shown the dampening effect that limited funds have on health care decision making resulting in fewer elective surgeries and, for the first time in history, a reduction in the number of prescriptions filled at retail. These trends raise the question of whether old models of pharmaceutical marketing will continue to be of any value in the new post-recessionary and health reform market of this decade. Already we’ve seen pharmaceutical marketers struggle with a lack of understanding of in-process decision making change let alone the anticipated shifts to follow resulting from the variety of impacts from health reform at the Federal or state level. Until Medicare and Medicaid funding streams are solidified, look for continued retrenchment among major pharma players who are simultaneously facing the brand patent cliff with newer biologic portfolios that remain costly to develop but smaller markets to derive revenue from versus the past.

Pharmacy Wholesalers (e.g. Cardinal, Bergen, McKesson)

A more mature distribution arm within the health care marketplace, wholesalers had undergone much of what health plans, PBMs and manufacturers are now facing so they are more prepared as well as better positioned to thrive in the health reform era. Providing more than just distribution of drugs, these intermediaries are engaged in a variety of value added services, systems and support products that make them inherently valuable amongst other stakeholders up or down stream from their role. Look for continued business growth and entrenchment by these entities with their customers as a result of health care reform.

Pharmacy Retailers (e.g. Walgreens, CVS/Caremark, Wal-Mart, Rite Aid)

Perennial cash cows in the market place of health care, retailers have continued to survive as they have also morphed into a variety of outlets for products that also include the services of a registered pharmacist in dispensing prescription medications. Through the addition of supermarket, big box (Wal-Mart, Costco), and department store (Target) pharmacies, traditional chain store retailers (Walgreens, CVS/Caremark) have begun the new independent pharmacies that they tried to eliminate. Meanwhile, independent pharmacies have remained stable and showed some growth during the current recession through their focusing on pharmacist driven services or time intensive compounding of products to meet new needs of customers not provided by other pharmacy retailers. The addition of clinics (Take Care and Minute Clinic) within the chain store pharmacy has been able to maintain store traffic owing to the general convenience of these pharmacies for families. However, look to greater strain on future growth among large retailers for some of the same fundamental reasons facing PBMs—biologic and specialty pharmacy products.

Over time, more details would be added to provide insight and information towards robust discussions around valuing this mix of health care organizations into the future.

Randy Vogenberg is principal at the Institute for Integrated Healthcare which offers health care and employer based benefits strategic consulting, value based benefit plans and design, pharmaceutical, diagnostic & device industry training, advising on managed customer linkages, and health policy and applied economic issues analyses for benefit design solution opportunities in the health care marketplace. He also principal of Bentelligence which provides a 360 degree view of benefits advisors, health plans and employer plan sponsors. It is a web based market intelligence tool and expert support for all stakeholders in health care. In addition, Randy recently wrote a book called Pharmacy Benefits that addresses benefit plan design, the selection of a pharmacy benefits manager and pharmacy network, compliance, specialty pharmacy, and cost-saving strategies which you can purchase at www.ifebp.org/pharmacy.

A San Francisco portfolio manager recommended a short on Monster Worldwide (NYSE: MWW, $13.50). The company’s business is of highly cyclical nature and the recent deterioration in economic indicators doesn’t bode well for MWW’s prospects. Monster has been losing share consistently in the online employment solutions space to CareerBuilder and has also seen its position challenged by a number of social media competitors, with LinkedIn presenting the biggest threat. Niche sites with better focus on specific industries like DICE are preferred by recruiters looking for better qualified candidates. Based on projected earnings and multiples for companies in related industries and with similar financial performance, the upside for the short is 40%+.

IEA’s decision to release 60 million barrels of oil, ostensibly to offset “Libyan supply disruptions”, is a commodity-denominated analgesic to take the sting out of the end of Fed QE2 debt monetization. TheUStranche is less than 5% of the Strategic Petroleum Reserve. All in, the supply add is about a day of demand, eadily sopped up by Chinese and Japanese shortages.

Much has been made of the fact theUStapped the SPR under catastrophic conditions: war (the Gulf War) and Katrina. For many investors, the end of QE2 and the market’s retreat is just such a catastrophe. So are fallong poll numbers.

But QE2 has been a false friend. We have a weakened dollar, propped up by a weaker euro, and put commodities on the offensive. Political draws of this kind are merely a rear guard action.

The question going forward is to what extent IEA/SPR becomes a second front for QE advocates as the Fed retreats. This equities sugar high can become an addiction if grown-ups fail to step in.

Stephen Maloney is a partner at Azuolas Risk Advisors with over 30 years experience in the US and EU modeling risk and valuation in energy, FX, and other commoditites. His clients include companies, hedge funds, and financial institutions actively marketing or trading physical and financial commodities and derivatives. He will be participating in our Energy Roundtable on July 14th in New Yorks City with former Shell President John Hofmeister.

Roulston Research’s Media Partner Mark Ramsey recently created a blog posting discussing how the challenges traditional radio faces today are a result of it’s business model. Traditional broadcast radio has always been focused on ratings being the key measure of success in the industry but an increasing amount of its competitors don’t focus on ratings at all. Mark states, “Radio is constrained by a model that rewards broadcast licenses with agency dollars but invites radio’s competitors to compete for everything else and even for the growing fraction of agency dollars transferred out of advertising and into marketing.”

Mark believes that control is moving more and more toward the consumer and broadcasters need to focus on providing content where consumers want it and monetize on that relationship. Fans will find content that they are interested in wherever it is located even if it is not local. Therefore, broadcasters should not delay or get rid of podcasts and provide more streaming content on their website to better meet the needs of consumers otherwise other competitors will take advantage of their lack of exposure in this space. He cites Apple as a perfect example when they introduced the iPhone even though they knew it would cannibalize some of the iPod’s market because they knew if they didn’t someone else would have. You can read Mark’s full article on how he thinks traditional broadcast radio needs to adapt their business model at http://www.markramseymedia.com/2011/06/the-problem-is-radios-business-model/

Mark Ramsey Media is one of the best-known research and strategy providers to media companies inAmerica. He has worked with several television and innumerable radio broadcasters over his career, including all the biggest names, from Clear Channel, CBS, Bonneville, Sirius XM, and Greater Media in theUSto Corus and Astral Media inCanada. Clients from outside broadcasting have included EA Sports and Apple.

ASan Franciscopresenter recommended National Cinemedia (NASDAQ: NCMI, $16.36) as a Buy. The company runs a nationwide cinema advertising network and has the leading market share in a rational duopoly with privately-held Screenvision. NCMI has 27-year exclusive contracts with the three largest movie chains inNorth America, which have founded the company and retain a combined 52% share in it, and the dominant presence in the metropolitan areas with the best demographics. CPM’s in movie advertising are currently double the prime time TV rates due to much higher recall rates for movie ads and better targeting capabilities, but will move higher as the domestic industry matures. As National Cinemedia adds more independent operators coupled with consolidation by the three chains, the network effect will continue to strengthen, bringing in more and more advertisers. The company is sacrificing short-term growth in CPM’s by going after large CPG accounts, but in the long-term higher utilization will more than make up for it. The presenter’s target is $30 by 2014, or almost a double from where the stock is trading now.