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Stocks To Watch: Chico's FAS, Heelys, Hewlett-Packard, TXU, UnitedHealth


Today's big stories and some stocks with potential to move...


Stocks to watch for Wednesday, March 7

  • Acadia Pharmaceuticals (ACAD) reported a fourth-quarter net loss of $12.5 million, or 42 cents a share, compared with a net loss of $10.2 million, or 44 cents a share, during the year-ago period. There were 29.9 million shares outstanding during the quarter vs. 23.4 million a year ago. Collaborative revenue at the San Diego-based biopharmaceutical company fell to $1.77 million from $2.44 million.
  • American Eagle Outfitters (AEOS) said it has authorized an additional 7 million shares under its buyback program.
  • Bob Evans Farms (BOBE) said same-store sales at Bob Evans Restaurants in the February period fell 0.7% from the same period a year ago. The Columbus, Ohio-based restaurant operator said Mimi's Cafe's February same-store sales rose 2.6%.
  • Career Education (CECO) named Gary McCullough as president, chief executive and board member. Robert Dowdell will serve as non-executive chairman, the company said.
  • CEC Entertainment (CEC) fourth-quarter net income rose 13% to $12.1 million, or 37 cents a share, from $10.7 million, or 31 cents a share, a year earlier. The operator of Chuck E. Cheese restaurants said revenue rose 7.4% to $176.3 million from $164.1 million a year ago. CEC Entertainment expects first-quarter earnings of 97 cents to $1.01 a share. Analysts predict earnings of 96 cents a share. The company predicts same restaurant sales, or sales at restaurants open at least one year, to increase 2.5% to 3%.
  • Cedar Shopping Centers (CDR) fourth-quarter net income applicable to common shareholders rose to $2.5 million, or 7 cents a share, from $1.5 million, or 5 cents a share, a year earlier as revenue rose 38%. The real estate investment trust said its funds from operations rose 41% to $11.7 million, or 30 cents a share, from $8.3 million, or 27 cents a share. Revenue rose to $34.3 million from $24.8 million in the year-ago period.
  • Chico's FAS (CHS) after Tuesday's close reported fourth-quarter net earnings of $18.2 million, or 10 cents a share, down from $44.5 million, or 24 cents a share, during the year-ago period. The latest results include pretax impairment expenses of about $8.6 million, or 3 cents a share, related to the planned closure of the Fitigues brand operations in the first quarter of fiscal 2007. The retailer posted net revenue of $446.3 million, up 19% from $375.7 million. Chico's said it will no longer provide specific quarterly or annual sales and earnings outlooks. The company said it believes that if it achieves a low-single-digit same-store sales increase for fiscal 2007, the current consensus analyst estimates for the period "appear reasonable." Chico's said February sales at company-owned stores open at least one year fell 4.3%. Total sales for the four weeks ended March 3 rose 15% to $113.6 million from $98.7 million, Chico' said.
  • Conseco (CNO) reported a large drop in fourth-quarter net income late Tuesday after the insurer was hit with significant losses in its long-term care business.
  • Copart (CPRT) reported second-quarter net earnings of $30.4 million, or 32 cents a share, up from $7.85 million, or 8 cents a share, during the year-ago period. Last year's results were adversely impacted by about $4.9 million as a result of the Gulf coast hurricanes. The provider of vehicle salvage disposition services posted revenue of $128.9 million vs. $125.1 million.
  • CV Therapeutics (CVTX) said ranolazine didn't meet the primary efficacy endpoint in a clinical trial. The biopharmaceutical company also said data from its ranolazine study indicates no adverse trend in death or arrhythmias in patients on the drug. CV Therapeutics believes the data could support expansion of the existing ranolazine extended-release tablets indication to include first line angina, which is a debilitating heart condition.
  • A recently disclosed informal inquiry of Google's (GOOG) income-tax reporting is part of a "normal" three-year government review, a Google spokesman said Tuesday. Google disclosed the Securities and Exchange Commission income-tax inquiry in a recently-released regulatory filing. The SEC inquiry is "part of the normal" tri-annual review as called for by the Sarbanes-Oxley Act, a Google spokesman said. Since March, the SEC has asked a number of questions concerning how Google accounts for interim-period taxes.
  • Hartford Financial Services Group (HIG) said it has agreed to sell its medical stop-loss insurance business to National Benefit Resources Inc., a subsidiary of UnitedHealth Group (UNH). Financial terms of deal, which is expected to close in early April, were not disclosed.
  • Heelys' (HLYS) fourth-quarter earnings rose sharply to $11.5 million, or 44 cents a share, from $1.44 million, or 6 cents a share, a year earlier. The Dallas maker of sports-related products said revenue for the quarter rose sharply to $71.1 million from $14.9 million. On average, analysts polled by Thomson Financial expected fourth-quarter earnings of 28 cents a share on revenue of $61 million. Analyst estimates typically exclude items.
  • Hewlett-Packard (HPQ) said it resolved ink cartridge patent violation issues with China-based Ninestar. As part of the settlement, HP said Ninestar acknowledged the validity of HP's patents and agreed to stop selling certain cartridges in the U.S. and other countries where certain patents are held. In July, HP notified Ninestar of patent infringements of its replacement "clone" cartridges that are compatible with several of its printers. HP filed complaints with both the U.S. District Court and the International Trade Commission.
  • Maxwell Technologies (MXWL) reported fourth-quarter net income of $633,000, or 3 cents a share. In the same period last year, the company posted a net loss of $1.12 million, or 6 cents a share. Revenue at the San Diego-based maker of energy storage and power delivery products rose to $15.1 million from $12.6 million. Maxwell expects first-quarter revenue of to be lower than it was in the fourth quarter.
  • Payless ShoeSource (PSS) said it plans to acquire privately held Collective International LP in a deal valued at roughly $91 million. Payless sees the deal closing in the first half of fiscal 2007. The company added that it expects the acquisition to be neutral to fiscal 2007 net earnings and to be accretive to fiscal 2008 net earnings.
  • Stride Rite (SRR) said Chairman and Chief Executive David Chamberlain plans to retire from his CEO position in 2007. The shoe company said it has already begun a search for Chamberlain's successor.
  • Town Sports International Holdings (CLUB), the parent company of New York Sports Clubs, reported fourth-quarter net income of $6.65 million, or 25 cents a share, up from $1.22 million, or 7 cents a share, a year earlier. The New York health club operator said revenue rose to 12% to $110.2 million from $98.5 million a year ago.
  • Texas Energy Holdings Limited Partnership said there will be no debt at TXU Electric Delivery, no need for rate increases and no spin-off of the unit after the partnership buys TXU (TXU). TXU said Monday that it would incur $24.6 billion in debt as a result of the $32-billion buyout deal. The partnership, a holding company formed by Kohlberg Kravis & Roberts, Texas Pacific Group and other investors to buy TXU, said TXU's rates will continue to be regulated by the Texas Public Utility Commission.
  • UnitedHealth (UNH) restated earnings, lowering them $1.13 billion over a 12-year period due to the options-backdating scandal.
  • W.R. Berkley (BER) said its board voted to increase the company's annual dividend rate to 20 cents a share, up 20% percent from the prior year's rate. The insurance holding company said the first quarterly dividend at the new rate of 5 cents a share will be paid on April 3, to stockholders of record on March 19.

Market Update

  • Asian trading closed with the Hang Seng -0.73%, Nikkei -0.47%, Sensex -0.92%, Taiwan +0.40% and Shanghai +1.99%.
  • Looking over at Europe, we find the CAC +0.07%, DAX +0.15%, FTSE -0.13%, ATX +1.00%, Swiss Mkt. +0.55% and Stockholm +1.20%.
  • Gold is trading +1.50 to 647.7 and crude oil is +0.06 to 60.75 this morning.
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