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Stocks To Watch: Accenture, Bank of America, Beazer Homes, Hewlett-Packard, Norfolk Southern


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


Stocks to watch for Wednesday, March 28:

  • Accenture (ACN) reported second-quarter net earnings of $296.7 million, or 47 cents a share, up from $69.7 million, or 11 cents a share, during the year-ago period. The management consulting, technology services and outsourcing company posted total revenue, including reimbursements, of $5.17 billion vs. $4.49 billion. Analysts polled by Thomson Financial had forecast second-quarter earnings of 42 cents a share on revenue of $4.69 billion. Adjusted earnings last year were 37 cents a share. Gross margin for the current quarter was 29.6% vs. 21.2% a year ago. New bookings for the quarter were $5.33 billion. Additionally, Accenture said it expects third-quarter net revenue in the range of $4.9 billion to $5.1 billion. For fiscal 2007, the company said it now sees net revenue growth at the high end of its previous outlook of 9% to 12% in local currency. Accenture also said it now expects per-share earnings of $1.88 to $1.93 for the year, up from its previous range of $1.80 to $1.85.
  • Advancis Pharmaceutical (AVNC) reported a fourth-quarter net loss of $13.8 million, or 44 cents a share, compared with a net loss of $6.4 million, or 22 cents a share, in the year-ago period. Revenue at the company fell to $1.24 million from $1.62 million, while expenses rose to $14.9 million from $8.3 million in the same quarter last year. The company said it is working with an investment bank to explore strategic alternatives.
  • AngioDynamics (ANGO) swung to a fiscal third-quarter loss of $10.4 million, or 55 cents a share, from a profit of $1.88 million, or 14 cents a share, a year earlier. Excluding stock-based compensation, one-time acquisition costs and other items, earnings were $3.4 million, or 18 cents a share, up from $2 million, or 15 cents a share, a year ago. The medical device company said net sales for the quarter ended March 3 rose 35% to $26.7 million from $19.8 million a year ago. AngioDynamics expects adjusted fourth-quarter earnings of 13 cents to 25 cents a share and revenue of $40 million to $43 million.
  • Arrow International's (ARRO) fiscal second-quarter income grew more than 13% to $14.5 million, or 32 cents a share, from a year-earlier profit of $12.6 million, or 28 cents a share. The Reading, Pa., medical-device maker's net sales increased 7.7% to $125.5 million from $116.5 million a year earlier. The company continues to expect fiscal 2007 earnings of $1.40 to $1.48 a share on net sales of $515 million to $525 million.
  • George Perlegos, the former chairman and chief executive of Atmel (ATML) and the company's largest individual shareholder, said he plans to nominate eight directors to the board of the chip maker. Perlegos, who was ousted last summer over alleged misuse of corporate travel expenses, had previously said that he planned to call a special shareholder meeting May 18 to nominate five members to Atmel's six-person board. However, if elected at the special meeting, the five directors would serve only until the next annual meeting of shareholders, which is scheduled for July 25, at which time Perlegos would support the eight director nominees he named Tuesday.
  • Bank of America (BAC) won federal approval to buy wealth-manager U.S. Trust Corp. and its subsidiary bank, U.S. Trust Company, the Federal Reserve said. U.S. Trust was formerly owned by Charles Schwab (SCHW). Bank of America announced its plan to buy U.S. Trust in November 2006 for $3.3 billion in cash. The combined entity becomes the largest U.S. manager of private wealth.
  • Beazer Homes USA (BZH) said in a statement that it "can not comment on or verify any investigation," following a report in the Charlotte Observer that federal authorities have launched a criminal inquiry into the company's business practices, including its role in arranging mortgage loans for buyers in its subdivisions. The Observer said its investigation into the home builder, published last week, found "the company's aggressive sales tactics were producing an unusually high rate of foreclosures in many of its Charlotte-area developments." Atlanta-based Beazer said in a statement that "based on our internal investigations to date, we have not found any evidence to support the allegations in the Charlotte Observer."
  • Brookfield Properties (BPO) said it has named Bryan Davis as chief financial officer, effective March 31. Davis was with Brookfield Asset Management for eight years, most recently as a managing partner and senior vice president of finance. Davis succeeds CFO Craig Laurie, who is moving to a new position at BAM.
  • CKE Restaurants (CKR) said it has closed an amended and restated $320 million senior secured credit facility. The facility consists of a five-year $200 million credit revolver and a six-year $120 million term loan, the company said.
  • Deutsche Bank (DB) hired away 16 money managers from Amvescap, a group that ran 20% of the firm's $465 billion in assets, triggering a fierce legal counterattack.
  • Forest City Enterprises (FCEA) fiscal fourth-quarter net earnings grew to $70.6 million, or 66 cents a share, from a year-earlier profit of $28.2 million, or 27 cents a share. Earnings from continuing operations rose to $30.7 million, or 29 cents a share, up from $10.7 million, or 10 cents a share, in the year-earlier period. The Cleveland-based real estate company's revenue increased 15% to $360.4 million from $313 million a year earlier.
  • H.B. Fuller's (FUL) first-quarter net income rose 36% to $20.8 million, or 34 cents a share, from $15.3 million, or 26 cents a share, a year earlier as revenue rose 5.6%. The St. Paul., Minn., chemical company's revenue grew to $351.8 million from $333 million in the year-ago period. For 2007, the company raised its per-share continuing operations earnings expectation to a range of $1.65 to $1.75 from a range of $1.58 to $1.68, previously.
  • Hewlett-Packard (HPQ) sued rival PC maker Acer Inc. in a Texas court, alleging it infringed on five patents. The patents HP claims were infringed include those covering technologies including power management and "clock switching." HP competes with Acer in the market for personal computers. According to market research firm IDC, in the fourth quarter of 2006 HP ranked first in the worldwide PC market, holding an 18.1% share, while Acer came in fourth, behind Dell (DELL) and Lenovo, with a 7.1% share. In its complaint, filed in U.S. District Court for the Eastern District of Texas, HP seeks an injunction against Acer's sales of certain products and unspecified damages.
  • Ingram Micro (IM) said that Chairman Kent Foster plans to retire at the company's annual meeting on June 6. The technology products distributor said it has named Dale Laurance to succeed Foster as chairman.
  • Landec (LNDC) reported fiscal third-quarter net earnings of $24.6 million, or 92 cents a share, up from $3.5 million, or 13 cents a share, in the year-ago period. The 2007 third quarter included $20.6 million of income from the sale of FCD, Landec said. Revenue at the maker of specialty polymer products fell to $53 million from $57.2 million in the same period last year.
  • Nexen (NXY) said it plans to implement a 2-for-1 stock split. Nexen said, pending shareholder approval of the split at its annual meeting scheduled for April 26, the company expects to issues the new shares May 15 to shareholders of record as of May 10.
  • Norfolk Southern (NSC) said it has approved an increase in its stock repurchase authorization, to 75 million shares from 50 million shares. The railroad operator also said the authorization term has been shortened by five years, to Dec. 31, 2010, from Dec. 31, 2015.
  • Vivus (VVUS) said its board has adopted a shareholder rights plan and amended its bylaws. Under the rights plan, Vivus will issue a dividend of one right for each share of its common stock held by stockholders of record as of April 13, the pharmaceutical company said. "The rights plan is designed to guard against partial tender offers and other coercive tactics to gain control of the company without offering a fair and adequate price and terms to all of Vivus's stockholders," the company said.
  • Xyratex (XRTX) reported fiscal first-quarter net earnings of $10.1 million, or 34 cents a share, up 57% from $6.43 million, or 22 cents a share, in the same period last year. Excluding certain items, the company reported a profit of $11.9 million, or 40 cents a share, compared with $8.3 million, or 28 cents a share, last year. The U.K.-based data storage company said revenue in the quarter ended Feb. 28 rose 24.1% to $236.4 million from $190.5 million. Analysts polled by Thomson Financial were expecting a per-share profit of 31 cents on revenue of $230 million. The company expects fiscal second-quarter earnings in a range of a penny to 11 cents a share, or 9 cents to 19 cents a share excluding items, on revenue of $203 million to $218 million. Analysts are looking for a per-share profit of 16 cents on revenue of $210 million.

Market Update

  • Asian trading closed with the Hang Seng -0.78%, Nikkei -0.64%, Shanghai +1.09 and Taiwan -0.73%.
  • Looking over at Europe, we find the CAC +0.33%, DAX +0.43%, FTSE -0.09%, ATX -0.19%, Swiss Mkt. -0.72% and Stockholm -0.72%.
  • Gold is trading +4.4 to 666.9 and crude oil is +1.59 to 64.52 this morning.
No positions in stocks mentioned.

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