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Stocks to Watch: Barnes & Noble, Dell, Micron, Nokia, Wal-Mart


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


Stocks to watch for Wednesday, April 5:

  • Altiris (ATRS) said its shareholders have approved the company's acquisition by Symantec (SYMC) for about $830 million, or $33 a share. The companies expect the transaction to close on Friday.
  • Apollo Management is exploring the private sale of a 10% stake in the private-equity firm for $1.5 billion. Founder Leon Black could net up to $750 million.
  • Barnes & Noble (BKS) said its special committee found "numerous instances" of improper backdating after reviewing more than 3,300 employees who received stock options from 1996 through 2006. The book retailer said the committee didn't find any intent to defraud, as the dating and pricing practice for stock options was applied uniformly and was not used selectively to benefit any one group or individual. As a result, the committee determined the company needed to take a charge resulting from the price differences on the revised measurement dates, and the gross amount of the price difference was $45.5 million.
  • The Department of Justice said it has reached a settlement that will require Mexico-based Cemex S.A.B. de C.V. (CX) to divest 39 ready-mix concrete, concrete block, and aggregate facilities in Arizona and Florida if the company succeeds in its hostile takeover of Australia-based Rinker Group (RIN). The total value of the Cemex/Rinker transaction, including debt, is roughly $12 billion.
  • Datascope (DSCP) said Chief Financial Officer Scott Kantor resigned to pursue other opportunities. The company named Hank Scaramelli, corporate vice president and controller, as acting chief financial officer.
  • In a filing with the Securities and Exchange Commission, Dell (DELL) said it expects revenue for the fiscal year, which ended Feb. 2, to be $57 billion, up from $55.9 billion for the previous fiscal year. Net income is expected to be $2.6 billion, or $1.16 a share, down from $3.5 billion, or $1.46 a share, for the previous fiscal year.
  • Delta Air Lines said traffic in March rose 3.5% from the same period last year, as capacity rose 0.4%. Load factor, or the percentage of a plane filled with passengers rose to 83% from 80.5% last year, the Atlanta-based airline said.
  • Endeavor Acquisition (EDA) will proceed with its acquisition of American Apparel, a manufacturer and retailer of cotton clothing. American Apparel expects its 2007 pro forma adjusted earnings before interest, taxes, depreciation and amortization around $40 million. Endeavor, a New York specialist acquisition company, required American Apparel to demonstrate a figure of at least $30 million for 2006.
  • General Mills (GIS) said it plans to sell $1 billion of floating rate convertible senior notes due 2037. The producer of packaged consumer foods said it will use the net proceeds from the offering to repay a portion of its outstanding U.S. commercial paper.
  • Healthways' (HWAY) fiscal second-quarter net income rose $11 million, or 30 cents a share, from $7.33 million, or 20 cents a share, a year earlier. The provider of health and care support programs said revenue for the quarter ended Feb. 28 rose to $160.3 million from $100 million. Healthways expects third-quarter net income of 29 cents to 30 cents a share.
  • IDEX (IEX) approved a 20% increase in its quarterly cash dividend and declared a 3-for-2 stock split. The company said the regular dividend rose to 18 cents from 15 cents, or 12 cents after the split, payable April 30 to shareholders of record April 16. The 3-for-2 split will result in the issuance of one additional share for every two shares owned. The new shares are payable on May 21 to shareholders of record on May 7.
  • Immucor (BLUD) reported third-quarter net earnings of $15 million, or 21 cents a share, up 28% from $11.7 million, or 17 cents a share, during the year-ago period. The company posted revenue of $57.1 million vs. $47.1 million. Analysts polled by Thomson Financial had forecast third-quarter earnings of 20 cents a share on revenue of $55 million. Immucor also said it expects to achieve future market share gains and revenue growth through continued Galileo placements and the launch of the Galileo Echo, which is dependent on clearance from the Food and Drug Administration. Immucor is a provider of automated instrument-reagent systems to the blood transfusion industry.
  • KKR dropped out of a consortium considering a takeover bid for U.K. supermarket chain J Sainsbury.
  • Merix (MERX) named Michael D. Burger president and chief executive, replacing Chairman William C. McCormick, who was serving as acting chief executive.
  • Micron Technology (MU) reported a fiscal second-quarter loss of $52 million, or 7 cents a share, on revenue of $1.43 billion. During the year-ago period, Micron earned $193 million, or 27 cents a share, on $1.23 billion in revenue. Analysts polled by Thomson Financial had forecast Micron to lose a penny a share on $1.46 billion in revenue. Micron, the world's largest maker of DRAM memory chips used in personal computers, has been hurt by falling prices for DRAM technology, which have dropped by about 40% since the end of 2006.
  • Monsanto's (MON) quarterly profit rose 23%, helped by surging demand for corn-based ethanol as an alternative fuel. The seed company also raised its full-year earnings forecast.
  • NeuStar (NSR) said it expects first-quarter earnings of $16.5 million to $17.5 million, or 21 cents to 22 cents a share, on revenue of $96.5 million to $97.5 million. Excluding items, the company forecast adjusted earnings of $20.9 million to $21.9 million, or 27 cents to 28 cents a share. For full-year 2007, NeuStar expects net income of $84 million to $88 million, or $1.04 to $1.09 a share, or adjusted earnings of $1.30 to $1.35 a share, and reaffirmed its revenue forecast of $428 million to $438 million.
  • Nokia (NOK) said it will pay $20 million to Qualcomm (QCOM) to cover patent licenses in the second quarter. The payment is unrelated to a series of lawsuits between the two companies concerning intellectual-property rights.
  • Parker Hannifin's (PH) total orders in March grew 3% from a year earlier. By operating segment, the motion and control technology company said orders fell 2% in its industrial North America segment; industrial international segment orders grew 15%; aerospace orders grew 2%, and climate and industrial controls orders fell 15%.
  • Rackable Systems (RACK) said it now expects to post a net loss in the first-quarter on revenue of $70 million to $75 million. Analysts polled by Thomson Financial are expecting, on average, a per-share profit of 5 cents on revenue of $74 million. The provider of servers and storage products also said it now expects its first-quarter gross margin to be 30% lower than its previous forecast, and for operating expenses to be higher than it previously expected due to one-time charges associated with the cancellation of an order from one customer. "Intense competitive conditions for business at our largest customers continued throughout the first quarter of 2007, which negatively impacted our gross margin and bottom line," said Chief Executive Tom Barton in a statement.
  • Radware Ltd. (RDWR) cut its first-quarter revenue forecast to $20 million from its previous range of $21 million to $22 million, and said it now expects to report a net loss for the period, compared with the breakeven results it previously forecast. "Revenues are expected to be flat compared to the first quarter of 2006,"said Roy Zisapel, president and chief executive, in a statement.
  • Restoration Hardware (RSTO) swung to fourth-quarter net income of $13.6 million, or 34 cents a share, from a year-earlier loss of $19.5 million, or 52 cents a share. The home-furnishings retailer's revenue increased 27% to $243 million in the period ended Feb. 3, from $191 million a year earlier, while same-store sales increased 9.1%.
  • Retail Ventures (RVI) reported a fiscal fourth-quarter net loss of $35.9 million, or 76 cents a share, compared with a net loss of $71.1 million, or $1.79 a share, in the year-ago period. The discount retailer said revenue in the quarter ended Feb. 3 rose 6.5% to $874 million from $820.5 million in the comparable period last year, as same-store sales fell 2.8%.
  • Ryland Group (RYL) said it expects to post a first-quarter loss of 50 cents to 60 cents a share. The loss is due to an impairment charge of about $65 million, the home builder and mortgage-finance company said. The impairments are associated with assets in the company's operations in Fort Myers, Fla.; Phoenix; Southern California and Washington, D.C. In addition, Ryland said it expects to write off the $15 million in goodwill associated with the acquisition of a California homebuilder, MJ Brock & Sons. Excluding the impairment, the goodwill write-off and the change in effective tax rate, per-share earnings for the quarter would have been 63 cents to 73 cents, the company said. Analysts polled by Thomson Financial are currently forecasting first-quarter earnings of 42 cents a share on revenue of $641 million.
  • Technology Research (TRCI) intends to restate its financial statements for the years ended March 31, 2005, and March 31, 2006, to correct reporting of income tax expense. The provider of electrical safety products also said borrowings under its joint line of credit agreement entered by the company and its Honduran unit triggered about $1.2 million in cumulative additional income taxes and interest.
  • TMNG Global (TMNG) completed its independent review of historical options granting practices. The provider of management consulting services said a special committee determined that 582 of 856 stock option and restricted stock grants made from Nov. 1, 1999, through Oct. 2, 2006, had measurement dates different from the recorded grant dates. TMNG estimates the cumulative intrinsic value of the misdated options was about $9.7 million on a pretax basis.
  • Wal-Mart (WMT) said it apologized to several shareholder groups the company had evaluated as potential threats after they submitted proxy petitions.
  • Workstream (WSTM) reported a fiscal third-quarter net loss of $4.38 million, or 9 cents a share, compared with $3.42 million, or 7 cents a share, in the year-ago period. The provider of workforce management products and services said revenue in the three months ended Feb. 28 rose 4% to $7.01 million from $6.74 million. Separately, Workstream named President and Chief Executive Deepak Gupta to its board.

Market Update

  • Asian trading closed with the Nikkei -0.30%, Shanghai +0.84%, and Sensex +0.54%
  • Looking over at Europe, we find the CAC -0.08%, DAX +0.09%, FTSE +0.12%, ATX +0.37%, Swiss Mkt. +0.17% and Stockholm -0.01%.
  • Gold is trading +1.1 to 678.5 and crude oil is -0.20 to 64.18 this morning.
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