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Stocks To Watch: Alcoa, AT&T, Clear Channel, Marsh & McLennan, Tyco


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


Stocks to watch for Tuesday, May 8:

  • Advance Auto Parts (AAP) said late Monday Chairman, President and Chief Executive Michael Coppola has resigned, effective immediately, to pursue other business opportunities. The retailer of automotive aftermarket parts named lead director John Brouillard as interim chairman, president and CEO, and the company said it is launching a national search for a new CEO. AAP also reaffirmed its first-quarter forecast for comparable-store sales in the low single digit range and earnings of 68 cents to 72 cents a share.
  • Alcoa (AA) offered $26.9 billion for Canadian rival Alcan (AL), escalating the commodity sector's buyout frenzy. The combined company would account for about 20% of global aluminum output.
  • Ashland (ASH) and Cargill said they have agreed in principle to create a new 50-50 joint venture to develop and produce biobased chemicals. The companies expect a combined initial capital investment of $80 million to $100 million. The joint venture's first product will be propylene glycol, and the companies plan to establish a 65,000 metric ton-per-year plant at a yet-to-be-finalized location in Europe. Ashland and Cargill expect to announce further details on the joint venture's name, leadership and development plans later in 2007.
  • AT&T (T) says it will spend as much as $1.4 billion more than anticipated on rolling out its new TV system, called U-verse.
  • Clear Channel (CCU) delayed its shareholder meeting by two weeks to evaluate a sweetened, $19.35 billion bid to take it private.
  • Engineering company Fluor (FLR) reported first-quarter net income slipped to $85 million, or 94 cents a share, from $89 million, or $1, a year ago. Revenue for the quarter held steady at $3.6 billion.
  • Guitar Center's (GTRC) first-quarter net income rose 10% to $17.2 million, or 57 cents a share, from $15.7 million, or 55 cents a share, a year earlier. The musical equipment retailer's sales grew 14% to $534.5 million from $470.7 million.
  • Health Care REIT's (HCN) first-quarter net income rose 19% to $29.7 million, or 32 cents a share, from a year-earlier profit of $25 million, or 34 cents a share. The company's average shares outstanding increased to 73.8 million from 58.5 million. The real estate investment trust's revenue jumped 48% to $112.6 million from $76 million in the year-earlier period. Funds from operations rose to 76 cents a share from 71 cents a share.
  • Heelys (HLYS) first-quarter net income rose sharply to $8.45 million, or 30 cents a share, from $1.7 million, or 7 cents a share, a year earlier. Revenue for the Dallas maker of sports-related products jumped to $49.4 million from $13.7 million in the year-earlier period.
  • Johnson & Johnson (JNJ) said it was pulling its Co-Star drug-eluting stent from overseas markets and withdrawing its U.S. application following poor results in a clinical trial.
  • Marsh & McLennan's (MMC) first-quarter net income fell 36% amid a gain from last year's divestiture of a claims-management provider.
  • McDermott International (MDR) reported first-quarter net earnings of $158.1 million, or $1.38 a share, up from $55.3 million, or 49 cents a share, during the year-ago period. The Houston-based energy services contractor posted revenue of $1.36 billion vs. $644.9 million. Operating income rose to $192.5 million from $67.7 million last year.
  • National Fuel Gas (NFG) fiscal second-quarter net income fell slightly to $78.4 million, or 92 cents a share, from $78.6 million, or 91 cents a share, a year earlier. The integrated energy company's revenue for the quarter ended March 31 fell 8.8% to $812.2 million from $891 million.
  • Powerwave Technologies (PWAV) first-quarter loss widened to $47.1 million, or 36 cents a share, from a year-earlier loss of $2.28 million, or 2 cents a share. The radio-frequency amplifier company said results from the latest quarter include a pretax restructuring and impairment charges of $11 million, and intangible asset and amortization charges of $7.8 million.
  • SBA Communications (SBAC) first-quarter loss widened to $16.4 million, or 16 cents a share, from $9.21 million, or 11 cents a share, a year earlier. The operator of wireless communications towers said revenue increased 29% to $95.81 million from $68.8 million.
  • Bunker Hill Capital L.P. partnered with Nick Valenti and Joachim Splichal to acquire Smith & Wollensky Restaurant (SWRG) , a New York steak house chain, for $11 a share in cash. As part of the transaction, Smith & Wollensky's Chief Executive Alan Stillman will acquire the Park Avenue Cafe and Quality Meats restaurants in New York City and the management rights to Smith & Wollensky in New York City, the Post House and Maloney & Porcelli.
  • Tyco's (TYC) net profit fell 6.7%, in what may be the manufacturing and services company's final quarter before its breakup, as restructuring expenses cut into profitability.
  • WellCare Health Plans (WCG) reported first-quarter net earnings of $25, million, or 60 cents a share, up 49% from $16.8 million, or 42 cents a share, in the year-ago period. The managed care provider said revenue in the three months ended March 31 rose to $1.24 billion from $730.4 million last year.
  • Wynn Resorts (WYNN) reported first-quarter net earnings of $58.4 million, or 54 cents a share. During the same period a year ago, the Las Vegas-based casino resort operator posted a net loss of $11.4 million, or 12 cents a share. Adjusted earnings were $72.6 million, or 67 cents a share, compared with $1.1 million, or 3 cents a share, last year. Net revenue jumped to $635.3 million from $277.2 million.

Market Update

  • Asian trading closed with the Hang Seng -0.91%, Taiwan -0.24%, Shanghai +2.83, Nikkei -0.07% and Sensex -0.82%.
  • A quick look across the pond finds the CAC -0.76%, DAX -0.98%, FTSE -0.64%, ATX -0.45%, Swiss Mkt. -0.98% and Stockholm -1.05%.
  • Crude oil is +0.03 to 61.50 and gold is -2.4 to 688.0 this morning.
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