3-D Game Company Proving 2-D Has Yet To Go Flat and Foreclosures Hit New List Of Cities; Job Losses Blamed

Since its 2006 launch, Perfect World has been using its 3-D Angelica game engine to create massive multiplayer online role-playing games (MMORPGs) for the Chinese market. Its two self-titled games as well as “Legend of Martial Arts,” “Zhu Xian” and others have brought its revenue from nowhere to more than $200 million annually in just three years.

But the drawback of 3-D gaming is that a lot of Chinese don’t have the technology for it. So last October, Perfect World rolled out its first 2-D game, “Fantasy Zhu Xian.” So far, the reception has been a pleasant surprise to Wall Street.

A screen shot of one of Perfect World’s popular games, “Sky Castle.” To keep growing, the company must create new games that captivate gamers. View Enlarged Image

“It’s doing better than I was expecting, better than most were expecting,” said ThinkEquity analyst Atul Bagga. [Read the full article]

Nonboom areas posting above-average ’09 foreclosure rates include Provo, Utah; Fayetteville, Ark.; Portland, Ore., and Rockford, Ill., data firm RealtyTrac said. Foreclosures rose in Honolulu, Minneapolis and Seattle at above twice the U.S. pace.

“Last quarter was really the first time we saw the wave in full evidence,” said Rick Sharga, a RealtyTrac vice president. He says if unemployment peaks soon, related foreclosures wouldn’t peak till year’s end or the first quarter of 2011.

Also Thursday, the Obama administration said to stem foreclosures, it wants to ease the process of making trial home loan modifications permanent. Streamlined paperwork should help do that when borrowers make three payments on time in the federal program.

Mutual funds specializing in real estate outgained the S&P 500 index by 7 percentage points last year. This year, gains look tougher to get. After collapsing 46.63% in 2008, the average real estate fund returned 30.34% last year vs. [Read the full article]

{loadposition in-article}

After collapsing 46.63% in 2008, the average real estate fund returned 30.34% last year vs. 23.45% for the S&P. It was their best performance since gaining 39% in 2006.

Long-term holders endured rough patches but got a 9.77% annualized return the past 10 years vs. -2.72% for the S&P. Real estate funds have gained an average 9.84% a year for the past 15 years vs. the S&P’s 6.09%.

In light of recent data, fund managers think the party has ended. Home sales in December fell 16.7% to a seasonally adjusted annual rate of 5.45 million, from an unchanged 6.54 million in November, the National Association of Realtors reported Jan. 25.

With an expanded homebuyer tax credit expiring this spring and high unemployment, “the bounce in the real estate market has pretty much run out of steam,” said Adam Gould, senior portfolio manager at Direxion Shares, which provides triple-leveraged short and long real estate ETFs, or exchange traded funds. [Read the full article]

Express Scripts’ (ESRX) purchase of the NextRx pharmacy benefit management unit of HMO WellPoint (WLP) has made a lot of investors happy. Since the deal was announced last April 13, Express Scripts shares have risen 60% to around 90 before pulling back a bit.

The $4.7 billion purchase, which closed Dec. 1, doubled to 50 million the number of beneficiaries served by Express Scripts. Equally important, the deal gives Express Scripts a 10-year contract to continue providing pharmacy benefit services to patients covered under WellPoint’s managed care plans.

Express Scripts, with a market cap of $23 billion, ranks second among pure-play pharmacy benefit managers by market cap. Medco Health Solutions (MHS) leads with a market cap of $30 billion.

CVS Caremark (CVS), which is a hybrid of retail pharmacies and pharmacy benefit managers, or PBMs, has a $46 billion market cap.

PBMs negotiate with manufacturers to get the best prices for drugs on behalf of their clients. [Read the full article]

{loadposition in-article-cramer-small}

You may also like...