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Leigh Baldwin & Co.

112 Albany Street, Cazenovia, NY 13035 | Phone: (315) 655-2964 Toll Free: 1-800-659-8044

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Diamonds and Dogs

8/3/12

Zipcar Inc. (ZIP)

Zipcar Inc. had a flat tire causing it to crash today, down 37.00% at $6.70. The "car sharing" company saw its shares run of the road after it released a horrible second quarter earnings report. The earnings fell short of Zipcar's estimates and caused management to slash its full year guidance. For the quarter, the car-sharing network posted revenue of $70.8 million, up 15% from a year ago, but below guidance of $71 million to $74 million and short of the Street consensus at $73.1 million. The company posted a GAAP loss for the quarter of $422,000, or a penny a share. For all of 2012, the company now sees revenue of $272 million to $278 million, down from a previous range of $290 million to $296 million, with adjusted EBITDA of $12 million to $16 million, down from $16 million to $20 million. All in all Zipcar isn't totaled but has some major dings it will need to fix.

Knight Capital Group Inc. (KCG)

Knight Capital Group rallied 56.60% to $4.04 today after losing over 60% of its value yesterday. The company was able to obtain a line of credit allowing it to operate today, although many brokerage firms were not directing business toward Knight Capital. Knight must repay the money lost by its trading glitch by Monday, however many wonder if it will be able to do so. Regardless, many investors think that Knight will be acquired, which appears to be causing the bounce today. At least one private equity firm has signed a non-disclosure agreement, a signal that it was looking at Knight's books for a potential acquisition or investment. Knight's rally makes it one of the largest gainers of the day, when yesterday it was one of the largest losers.
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