General News

U.S. September consumer credit falls $14.8B, Fed says

ICF International (NASDAQ: ICFI) shares trade higher today on the heels of both a solid earnings report and price target increase from Canaccord Adams. The shares are trading up about 3.75% to $29.76.

ICF reported an EPS of $0.32, which topped Street estimates by 2c. They also provided strong guidance for Q409 and FY09.

The Canaccord analyst says, "Once again, ICF demonstrated the strength and consistency of its business despite the overall weakness in the economy. Most notably, the company’s organic revenue growth was 14.1%, up from the prior quarter’s 9.2%, due to gains in federal business and energy efficiency programs, as well as an increase in the firm’s commercial transportation business. At the end of Q3, backlog was up by $200M to $1.4 billion, including funded backlog of $556M (38.8% of the total). Management guided for Q4/09 revenue of $165-$170M and EPS of $0.30-$0.33. For 2010, the company guided for revenue of $715-$750M and EBITDA margins of 9-10%. Because these forecasts are in line with our prior estimates, we make no changes to revenue or EPS forecasts...Given the consistency and visibility of ICF’s business, we feel a higher EV/EBITDA multiple is appropriate when valuing the stock. We therefore increase our price target to $34 (from $32), which is based on 10x EV/2010E EBITDA (up from 9.5x previously).

The unemployment rate jumped above 10 percent for the first time since 1983 in October according to the Labor Department.

Employers cut another 190,000 jobs in the last month pushing the unemployment rate to 10.2 percent, from the 9.8 percent rate in September. The job losses in October saw an improvement over the 219,000 reported in September, however higher than the economist's estimate of 175,000.

Economists had been expecting the unemployment rate to reach above the 10 percent mark before working back down. However the jump from September to October shows that employers are showing no immediate signs of slowing cost cuts.

The pending holiday shopping season will indicate whether consumers are going to be able to handle the high unemployment rate and go out to spend money, while the risk of job loss is evident.

The sustainability of an economic turnaround hinges on the strength of consumer spending.

There are now a record 5.6 million people that have been unemployed for six months or longer with the average time unemployed for those without jobs has reached 26.9 weeks. Thursday, Congress voted to extend unemployment benefits by up to 20 weeks.

The move to 10.2 percent in October is ahead of the pace that economists have forecasted.

Art Hogan, market analyst for Jefferies told StreetInsider.com that that important thing to note is the revised numbers tells another story, in that there have been 90,000 jobs revised from the past two months.

"The three month moving average of the nonfarm payroll number has gone from 220,000 down to 187,000, so we are moving in the right direction," Hogan said. "At the end of the day people don't think that 10.2 in the October month is going to get us to 11 in 2010. It probably peaks out at 10.5"

Stock markets is slighlty lower on the day, with the Dow down 0.4 percent at last check

Gold futures reach record $1,101/ounce in New York

Gold advances to a new record $1,097.75 an ounce in London