$DB Puts Out a List of the 30 Best Companies Along With Price Targets

“David Bianco and Deutsche Bank’s U.S. equity strategy team believe that the S&P 500 will reach 1,575 by the end of 2013.

If we get a decent deal to address the sequestration, Bianco thinks the index goes as high as 1,600.

But within the market, some stocks look better than others.

In his latest note to clients, Bianco includes a list of the 30 stocks he likes right now.

All of these stocks are buy-rated by Deutsche Bank analysts.  Each have a market capitalization over $10 billion, a price-earning ratio on 2013 EPS below 18, 2013 EPS growth above 5 percent, and a net debt to market cap ratio below 30 percent (excluding Financials).

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“Fourth quarter earnings season is in full swing.

According to FactSet, just over 10 percent of companies in the S&P have reported their financial results, and two thirds have beat expectations on revenues and estimates.

However, these announcements are about more than EPS.  Through their press releases and earnings calls, these companies reveal what’s really going on in the world from their unparalleled perspectives.

We’ve listened to the latest earnings calls and read through the earnings call transcripts to fill you in on what executives are saying about the world and where it’s headed.

Generally speaking, companies are bullish on China, bearish on Europe, and increasingly trying to cope with regulatory and technological changes.

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“(This is a breaking news story. Check back for updates to this article on CNBC.com.)

McDonald’s reported quarterly earnings and revenue that beat analysts’ expectations on Wednesday, but warned that it sees sales lower early in the first quarter.

After the earnings announcement, the company’s shares edged lower in pre-market trading. (Click here to see how McDonald’s stock is trading before the opening bell following the earnings release.)

The company posted fourth-quarter earnings excluding items of $1.38 per share, up from $1.33 a share in the year-earlier period.

Revenue increased to $6.95 billion from $6.82 billion a year ago.

Analysts had expected the company to report earnings excluding items of $1.33 a share on $6.89 billion in revenue, according to a consensus estimate from Thomson Reuters.

In the U.S., same-store sales were up 0.3 percent in the quarter, but same-store sales in Europe were down 0.6 percent and comparable sales in the Asia-Pacific/Mideast/Africa were off 1.7 percent.

The fast-food giant warned that it expects sales to be lower in January. “For the near-term we expect top and bottom-line growth to remain pressured, with January’s global comparable sales expected to be negative,” CEO Don Thompson said in a statement.”

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“Jan 23 (Reuters) – Upscale leather-goods maker and retailer Coach Inc on Wednesday reported holiday quarter sales below Wall Street forecasts as a tougheconomy and more discounting on women’s handbags by rivals hurt sales in North America.

Overall revenue in the second quarter rose 3.8 percent to $1.5 billion, missing Wall Street analyst projections for net sales of $1.6 billion, according to Thomson Reuters I/B/E/S.

Sales at stores open at least a year in North America, still its biggest market by far, fell 2 percent during the quarter.

Net income in the quarter, which ended Dec. 29, was $352.8 million, or $1.23 per share, compared with $347.5 million, or $1.18, a year earlier. ”

“CSX Corp. (CSX) and Norfolk Southern Corp. (NSC), the two largest U.S. eastern railroads, topped analysts’ fourth-quarter profit estimates as gains in container cargoes helped counter sliding coal volumes.

Intermodal-container shipments, which can move via highway, ocean or rail, rose 2.8 percent at CSX and 3.2 percent at Norfolk Southern in the period, according to Association of American Railroads data. Coal slumped about 14 percent as utilities abandoned it for cheaper natural gas.

Yesterday’s earnings reports by CSX, Norfolk Southern and Kansas City Southern showed how the industry is adapting to declines in shipments of coal, which remains the biggest single product carried by the major railroads. Union Pacific Corp. (UNP), the biggest U.S. carrier, is set to report results tomorrow.

CSX and Norfolk Southern “put up good numbers in a very difficult environment, slightly better than expected,” said Peter Nesvold, a Jefferies Group Inc. analyst in New York. “These companies do a really good job redeploying assets in other parts of the network when things like coal are soft. It’s going to be difficult for them to grow earnings meaningfully until you start to see a rebound in coal.”

While the three companies all beat estimates, each posted profit declines from a year earlier. Norfolk Southern will face “continuing headwinds” from coal in 2013, Chief Marketing Officer Donald Seale said during a conference call.

Electricity Demand…”

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“United Technologies Corp.’s UTX +0.60% fourth-quarter profit jumped 55% as the industrial conglomerate benefited from gains on the sale of its legacy Hamilton Sundstrand’s Industrial businesses, though costs rose sharply.

The maker of Otis elevators, Pratt & Whitney aircraft engines and Carrier air-conditioning systems has posted improved profits recently, aided by its $16.5 billion acquisition of aircraft-component maker Goodrich Corp., which closed last year.

United Technologies reported a profit of $2.06 billion, or $2.26 a share, up from $1.33 billion, or $1.47 a share, a year earlier. The latest quarter included about $1.05 billion, net of tax, in gains on the sale of the Hamilton Sundstrand businesses. United Technologies’s earnings from continuing operations fell to $1.04 from $1.42 a share. Revenue was up 14% to $16.44 billion.

Analysts surveyed by Thomson Reuters recently expected a per-share profit from continuing operations of $1.03 on revenue of $16.63 billion.

Revenue from Pratt & Whitney rose 12%, while profit shrank 30%. Revenue at the Otis unit edged down 0.2% as profit fell 9.4%. UTC Aerospace Systems, a new unit that includes Goodrich and Hamilton Sundstrand, saw its revenue more than double and its earnings rise 33%.

Total costs and expenses rose 18% to $14.79 billion.”

“DAVOS, Switzerland (Reuters) – Business leaders in Davos have plenty to worry about, from the euro zone to global geopolitical upheavals, but at heart their problem is simple: how to find new revenue in a low-growth world.

Half a decade on from the financial crisis, investors want to see earnings driven by more than just cost cutting. Their focus now is on a return to sales growth, which presents the world’s largest corporations with a $5 trillion challenge.

That is the amount of extra revenue the 1,200 top global companies need to find each year simply to meet analysts’ expectations, according to consulting firm Accenture.

“The trouble is that stock markets’ expectations of the ability of companies to grow far exceeds the underlying macroeconomic growth rates,” said Mark Spelman, Accenture’s global head of strategy.

“So companies need to get beyond just thinking about emerging markets and rising middle classes and start to look at those segments where you are seeing significant consumer change, because there is a lot of latent growth in those segments.”

Increasingly, companies are seeking specific pockets of opportunity for sales growth. They remain cautious about major new investments, however, with confidence among managers in the near-term outlook for their businesses still weak….”

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“(Reuters) – JPMorgan Chase & Co Chief Executive Jamie Dimon apologized to shareholders for the $6 billion loss caused by the so-called “whale” trade, calling it a “terrible mistake,” but said the bank has moved on and is still highly profitable.

“If you’re a shareholder of mine, I apologize deeply,” Dimon said at a presentation at the World Economic Forum in Davos, Switzerland. “But we had record results and life goes on…”

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“INDIANAPOLIS (AP) — WellPoint Inc.’s fourth-quarter earnings jumped 38 percent compared to the final quarter of 2011, when the nation’s second largest health insurer incurred a big hit from its Medicare Advantage business.

But the Blue Cross Blue Shield insurer also said Wednesday it could make less this year than it did in 2012, as it prepares for expansion resulting from the health care overhaul and other growth opportunities.

The Indianapolis company earned $464.2 million, or $1.51 per share, in the three months that ended Dec. 31. That’s up from $335.3 million, or 96 cents per share, in the last quarter of 2011. Excluding the investment and tax settlement gains and other adjustments, earnings totaled $1.03 per share.

Operating revenue inched up less than 1 percent to $15.27 billion. That excludes investment gains.

Analysts expected, on average, earnings of 94 cents per share on $15.29 billion in revenue, according to FactSet. Analysts typically exclude investment gains from their estimates.

In the final quarter of 2011, WellPoint took a $50 million hit from its Medicare Advantage business, which involves privately run versions of the government’s Medicare program that covers the elderly and disabled people. The insurer had problems with a plan in Northern California that attracted more customers with a higher risk profile than it expected because a competitor left the market. That helped push quarterly earnings down 39 percent.

In the final quarter of 2012, the insurer’s performance got a lift from $243 million in investment gains and an income tax settlement.

WellPoint’s membership grew more than 5 percent to 36.1 million people, largely due to its recently completed, $4.46 billion acquisition of Medicaid coverage provider Amerigroup Corp. Medicaid is the state-federal program that provides health coverage for the needy and disabled people.

For the full year, WellPoint earned $2.7 billion, or $8.18 per share, on $60.73 billion in operating revenue….”

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“Unilever (UNA), the world’s second-largest consumer-goods maker, reported revenue growth that beat estimates for a third straight quarter, led by gains in North and South America and demand for personal-care products.

Sales excluding acquisitions and currency shifts rose 7.8 percent in the three months to Dec. 31, London- and Rotterdam- based Unilever said today, exceeding the 6.2 percent average estimate of 13 analysts polled by Bloomberg. The quantity of goods sold gained 4.8 percent, more than the 4 percent estimated by analysts and the biggest quarterly gain in two years.

“It was an excellent quarter for Unilever, continuing its run of high quality, consistently strong performance,” Andrew Wood, an analyst at Sanford C. Bernstein, said in a note. “While the lack of growth in foods and Europe remains a worry, the overall performance remains impressive.”

Unilever rose as much as 3 percent in Amsterdam trading, the most in three months. Sales growth of 12 percent in the Americas, which represent a third of the company’s 51.3 billion euros ($68.4 billion) in annual revenue, was more than double the estimate of analysts such as Alain-Sebastian Oberhuber at MainFirst Schweiz AG. The Anglo-Dutch company has been pushing brands including Magnum ice cream in emerging markets such as Indonesia and Brazilto offset slowing growth in other regions.

Unilever’s results put pressure on Danone (BN) and Nestle SA (NESN), which are both scheduled to report full-year results next month. The maker of Knorr soups said today it expects “difficult” economic conditions to persist this year.

Emerging Markets…”

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“Brazil’s inflation in mid-January rose more than forecast by all economists surveyed by Bloomberg, as price pressures remain strong even with the economy struggling to pick up speed.

Prices as measured by the IPCA-15 price index rose 0.88 percent in the month through mid-January, the national statistics agency said in a report published on its website. That was higher than every forecast from 38 economists surveyed by Bloomberg, whose top estimate was for an increase of 0.86 percent, and whose median forecast was for 0.82 percent. Mid- month inflation has exceeded the median estimate from economists for seven straight months.

Annual inflation accelerated for the fourth straight month to 6.02 percent from 5.78 percent in mid-December.

Brazil’s President Dilma Rousseff has labored to pull the world’s second-largest emerging market out of a slowdown that has lasted more than a year by cutting taxes to spur consumption and industry and pressuring commercial banks to lower rates. The central bank since August 2011 has cut the benchmark rate by 525 basis points, the most of any Group of 20 nation.

The central bank estimates that gross domestic product in 2012 expanded 1 percent, down from 2.7 percent the year before. Finance Minister Guido Mantega on Dec. 27 said the economy will grow 3 percent to 4 percent this year….”

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“Siemens AG (SIE)’s first-quarter profit declined on charges for delays in high-speed trains orders and a failed solar power project, adding to more than 1 billion euros ($1.3 billion) in predicted restructuring costs this year.

Net income from continuing operations at Europe’s largest engineering company slipped 1.4 percent to 1.3 billion euros in the three months through December, Munich-based Siemens said in a statement today. Costs relating to train delivery delays and energy projects topped 300 million euros in the fiscal first quarter. The stock declined as much as 1.4 percent.

Chief Executive Officer Peter Loescher needs to defend his strategic skills today as he faces thousands of investors at the annual shareholder meeting. The CEO, on his second five-year term, has come under pressure after most deals that he supervised soured, and a push into more environmentally friendly energy generation led to spiraling costs. Profitability last year dropped back to the levels when Loescher started in 2007, prompting a new program in November to cut costs.

“The unfortunate thing we’ve seen with Siemens over the past few years is that there’s a continued line of charges,” saidJames Stettler, a London-based Canaccord Genuity analyst who rates Siemens hold. “Investors tend to be a bit skeptical with Siemens, because you never know the underlying earnings as there’s such a volatility.”

Solar Charges…”

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“U.K. jobless claims unexpectedly fell in December and a quarterly measure of unemployment also dropped, underlining the resilience of the labor market in the face of a weak economic recovery.

Unemployment claims declined by 12,100 from November to 1.56 million, the lowest since June 2011, the Office for National Statistics said today in London. In the quarter through November,unemployment measured by International Labour Organisation methods fell to 7.7 percent, the lowest since the three months through April 2011. The report also showed that wage growth slowed.

The jobs market remains the bright spot in the economy, which may have shrank in the fourth quarter and is facing the threat of a triple-dip recession. The Bank of England’s Monetary Policy Committee voted 8-1 to leave its bond-purchase programunchanged this month and said today recent developments “strengthened” the view among some officials that no more stimulus is needed.

“It continues to be surprising that employment is growing so strongly when the economy is flat-lining,” said Samuel Tombs, an economist at Capital Economics Ltd. in London. “The weakness of pay growth helps. The economy may grow this year, albeit slowly.”

The median forecast of 28 economists in a Bloomberg News Survey was for jobless claims to increase by 500 in December. The unemployment rate on that basis remained at 4.8 percent.

Payrolls Growth…”

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“Russian industrial production unexpectedly slowed in December to the weakest pace in eight months, showing the slumping economy failed to pick up momentum last quarter.

Output at factories, mines and utilities rose 1.4 percent from a year earlier, the slowest pace since April, compared with 1.9 percent in November, the Federal Statistics Service in Moscow said today in an e-mailed statement. The median estimate of 17 economists in a Bloombergsurvey was for a 2 percent advance.

Industrial output in the world’s largest energy exporter is stabilizing at weak levels as the economy cools, the central bank said this month. Stagnating output may support the government’s calls for monetary stimulus and cheaper money to boost growth, which was the weakest in the third quarter on an annual basis since the recovery from a recession began in 2010.

“With the important exception of oil, external demand is weak,” Jacob Nell, chief economist for Russia at Morgan Stanley (MS) in Moscow, said by e-mail before the report. “Fears of a return of a second wave of the crisis are keeping domestic consumers and businesses cautious.”

Economic growth slowed to 2.4 percent in the fourth quarter compared with the same period a year earlier from 2.9 percent in July-September, according to the median estimate of 15 economists in a Bloomberg survey. The government should seek to increase growth to a stable 5 percent pace, Prime Minister Dmitry Medvedev told a conference in Moscow last week.

Rate Arguments…”

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“European Central Bank President Mario Draghi suggested the worst of the sovereign debt crisis may be over, saying the “darkest clouds’ over the euro area have lifted due to decisive policy steps last year.

“We can begin 2013 on a more confident note, precisely because significant progress was made during 2012,” Draghi said in a speech in Frankfurt late yesterday. “The darkest clouds over the euro area subsided. Europe’s leaders recognized that monetary union needs to be complemented by a financial union, a fiscal union, a genuine economic union and eventually a deeper political union.”

Draghi’s comments are the latest to indicate the ECB chief is increasingly confident that the three-year debt crisis has been contained and that the 17-nation currency bloc can emerge from recession later this year. He defended the ECB’s so-far untapped bond-purchase plan, which has calmed fears of a euro break-up on financial markets, saying it is fully in line with the central bank’s price-stability mandate and doesn’t threaten its independence.

“The ECB remains steadfastly committed to its primary mandate of ensuring price stability,” he said. “All of our measures are designed to achieve this goal. And looking at current and expected inflation rates, there is simply no evidence that could substantiate fears about any deviation from price stability.”

The euro was little changed after Draghi spoke. It fell 0.2 percent to $1.3292 at 9 a.m. inFrankfurt today.

Economic Recovery

While the ECB expects the euro-area economy to shrink 0.3 percent in 2013, Draghi said this month he expects a “gradual recovery” to begin later in the year….”

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“Robert Bosch GmbH, the world’s biggest car-parts maker, said it will hold back on investments this year as a recession in Europe caused profitability in 2012 to miss targets and sales rose only because of currency effects.

The operating return on sales was about 2 percent last year, compared with a long-term goal of 8 percent, Chief Executive Officer Volkmar Denner said at a press briefing. Revenue, which increased 1.6 percent to 52.3 billion euros ($69.5 billion) from 51.5 billion euros in 2011, would have fallen without a boost from exchange rates, he said.

“We can’t be satisfied with the business year 2012,” Denner said at the press conference in Bosch’s headquarters city of Stuttgart, Germany. “We’re looking at fixed costs very closely, and will be restrictive regarding investments and acquisitions.”

The European auto market contracted by 16 percent last year to the lowest in almost two decades, and carmakers such as PSA Peugeot Citroen (UG) and General Motors Co. (GM)have announced factory shutdowns in response. Bosch also said today that it wrote down 600 million euro in assets at its unprofitable solar-panel division, a unit whose future it’s reviewing…”

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“SAP AG (SAP), the biggest maker of business-management software, forecast at least a 12 percent gain in full-year earnings as it adds Internet-based programs to attract users and fend off competition from Oracle Corp.

Operating profit adjusted for some items will rise to 5.85 billion euros ($7.79 billion) to 5.95 billion euros from 5.21 billion euros in 2012, assuming unchanged exchange rates, SAP said today. Analysts project 6.11 billion euros, the average of estimates compiled by Bloomberg.

While the forecast trailed estimates, it helped quell concerns that SAP’s pace of growth may be petering out. Co-Chief Executive Officers Jim Hagemann Snabe and Bill McDermotthave added mobile and Web-based programs as well as the fast Hana database to compete with Oracle and persuade companies to spend even as economies such as that of the euro area shrink.

“I certainly wouldn’t consider that a low-key guidance, it’s double-digit growth and it’s significant,” McDermott said in an interview at the company’s headquarters in Walldorf, Germany. “Our cloud business is growing fantastically, as is Hana and mobile, and this emanates from a consistent core, so we’re really bullish.”

SAP shares rose 2.7 percent to 59.40 euros as of 10:43 a.m. inFrankfurt, valuing the company at 73 billion euros. The stock rallied 50 percent last year, making it the fourth-best performer in Germany’s 30-member benchmark DAX Index and exceeding Oracle (ORCL)’s 30 percent gain….”

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“The world’s largest banks need to shrink or be broken up in order to regain investors’ confidence after four years of scandals, high-profile trading losses and financial crises, according to a Bloomberg poll.

Almost 60 percent of respondents said they were not confident or “just somewhat confident” that banks are taking prudent risks and conforming to the law, and getting smaller was seen as the top fix in the Bloomberg Global Poll, with 29 percent choosing that remedy. Changing the compensation structure was the No. 2 way to improve trust, with 23 percent.

After injecting $600 billion to rescue failing banks during the worst financial crisis since the Great Depression, governments around the world have tried in the last four years to strengthen banking regulations to prevent a similar outcome. Those efforts have been stymied by conflicting laws and increasing complexity, making the changes harder to implement and reducing their effectiveness.

Solutions suggested so far are “a grab bag of minimalist Band-Aids to patch up the self-inflicted wounds” of the financial system, said Lew Coffey, a poll participant and a fixed-income analyst at Windsor Capital Management LLC in Phoenix. “What’s required to re-establish investor confidence is a series of basic measures to simplify the business, isolate different kinds of risks into different boxes and increase transparency to outsiders.”

Plain Vanilla…”

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“Bank of England policy makers said the pound’s level may prove an obstacle to rebalancing the economy and David Miles cited the currency as he repeated his call for an expansion of stimulus.

The Monetary Policy Committee voted 8-1 to keep their bond- purchase plan unchanged at 375 billion pounds ($595 billion), according to minutes of the Jan. 10 decision published in London today. Members diverged on the risks to the economy, with some saying there was scope for wages to pick up while others noting that the economy could grow faster without generating inflation.

“Substantial headwinds to recovery remained, including the drag to activity from fiscal consolidation, a further squeeze in household real incomes, and the deterioration in U.K. competitiveness over the past couple of years,” the minutes said. “The sterling real exchange rate might be above the level compatible with the necessary rebalancing of the economy.”

The Bank of England halted bond purchases in November and is relying on its so-called Funding for Lending Scheme to aid the recovery. Bank of England Governor Mervyn King said yesterday that credit conditions have improved, and “should improve further as the impact of the FLS kicks in.”

The pound rose after today’s minutes report and data showing falling unemployment. The currency was up 0.2 percent today at $1.5871 as of 9:35 a.m. in London.

King’s View…”

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“Spain’s recession deepened in the last quarter of 2012 after Prime Minister Mariano Rajoy’s government approved its fifth austerity package in a year to reduce the second-largest budget deficit in the euro area.

Gross domestic product shrank for a sixth quarter, contracting 0.6 percent from the previous three months, when it slipped 0.3 percent, the Bank of Spain said in an estimate in its monthly bulletin today. Fourth-quarter GDP matched the median forecast in a Bloomberg News survey of 26 economists.

Output may have contracted 1.3 percent in 2012 as budget cuts weighed on economic activity, the Madrid-based Bank of Spain said. While it’s not yet clear if Spain will meet its 2012 deficit target set by the European Union, satisfying this year’s goal “will require a very ambitious additional fiscal effort from the central government and the regions,” it said.

Rajoy is seeking to avoid a full bailout as a slump in the euro area’s fourth-biggest economy enters its fifth year, undermining efforts to meet EU targets. The European Central Bank’s pledge to provide support to nations struggling to bring down yields may curb borrowing costs until a recovery, he said last month.

‘Extremely Weak’…”

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