Stocks to Watch: DaimlerChrysler, General Mills, Starbucks, Tribune, Xerox
Today's big stories and some stocks with potential to move...
Stocks to watch for Wednesday, April 4:
- Alliant Techsystems (ATK) late Tuesday said it has agreed to acquire satellite components and subsystems provider Swales Aerospace. Financial terms weren't disclosed. The Minneapolis-based advanced weapon and space systems company said the transaction is subject to antitrust and shareholder approvals. Alliant said it expects to realize more than $100 million in additional revenue in 2008 on the deal.
- Bob Evans Farms (BOBE) said that March same-store sales at Bob Evans Restaurants rose 1.2% from the comparable period last year. Mimi's Cafe same-store sales for fell 0.2% in March, the company said.
- CKE Restaurants (CKR) agreed to repurchase 4.07 million shares of its common stock, or about 6.1% of its total outstanding shares, from Pirate Capital LLC for $18.97 a share. CKE, which owns and operates Carl's Jr., Hardee's and La Salsa Fresh Mexican Grill restaurant brands, said the purchase price is based on Monday's closing price. The deal is expected to close Thursday.
- CryoCor (CRYO) said its annual report on Form 10-K included an audit opinion with a "going concern" qualification. A going concern qualification is a statement from the company's independent registered public accounting firm expressing substantial doubt, based upon current financial resources, whether the company can continue to meet obligations over the next year. The medical device company said in the report that it has sufficient working capital to fund its operations until December 2007 and to pay off its existing debt, and that additional capital would be needed to fund operations into 2008.
- DaimlerChrysler (DCX) said the company should sell its Chrysler division and focus on its other operations. The auto maker confirmed it is in talks over the future of Chrysler but said all options are still open.
- Exfo Electro-Optical Engineering (EXF) reported fiscal second-quarter net earnings of $2.68 million, or 4 cents a share, up 97% from $1.37 million, or 2 cents a share, in the year-ago period. Revenue at the maker of test and measurement products for the telecommunications industry rose 17.1% to $35.2 million from $30.1 million. Exfo forecast earnings of 3 cents to 6 cents a share on revenue of $36 million to $39 million.
- General Mills (GIS) hopes to tap a growing market -- frozen entrees in warehouse-club stores -- with pasta dishes from celebrity chef Mario Batali.
- GlaxoSmithKline's (GSK) Trexima migraine headache treatment proved superior to alternate treatments in two studies of more than 2,900 patients. Glaxo, which is developing Trexima with Pozen (POZN), said results of the studies are part of a New Drug Application under review by the Food and Drug Administration.
- GOL Linhas Aereas Inteligentes (GOL) said passenger traffic in March rose 42.9% from last year, as capacity rose 59.2%. Load factor, or the percentage of a plane filled with passengers, fell 7 percentage points from last year to 61.8%, the Brazil-based airline said.
- Icagen (ICGN) said it has ended its Phase III Assert trial of senicapoc, a treatment for sickle cell disease in adults, based on a recommendation of the independent Data Monitoring Committee. The DMC said data from the trial indicated there was "low probability of achieving a reduction in crisis rate, the primary endpoint," the biopharmaceutical company said. There were no statistically significant differences in safety measurements between the senicapoc and placebo treatment groups, according to the data, the company noted. Icagen said it has informed the Food and Drug Administration of its plan to end the study. The company also said it will consider future options for the development of senicapoc.
- Leggett & Platt (LEG) will sell its Prime Foam operations to Comfort Co., a unit of privately held Catterton Partners, for an undisclosed amount. The company said its prime foam operations had 2006 annual revenue of about $200 million. Leggett & Platt said the sale is consistent with its previously stated intention to actively manage its business. Leggett & Platt, which had 2006 revenue of $5.51 billion, said the sale, which is the largest in the company's history, will generate a pretax gain of about 6 cents a share. However, the sale will cut full-year operating earnings by about 4 cents a share.
- Oxford Industries (OXM) reported fiscal third-quarter net earnings of $9.74 million, or 54 cents a share, down 33% from $14.6 million, or 82 cents a share, in the year-ago period. The Atlanta-based apparel maker said revenue in the quarter ended March 2 fell 3.1% $266.6 million from $275.2 million in comparable period last year. Oxford expects fiscal fourth-quarter earnings from continuing operations of $1.07 to $1.14 to a share, or $1.00 to $1.07 excluding a gain on the sale of real property. Oxford had previously forecast earnings from continuing operations of $1.17 to $1.25 a share. The company now expects fourth-quarter revenue of $285 million to $295 million, compared with its previous forecast of $295 million to $305 million. Analysts are expecting per-share earnings of $1.21 a share on revenue of $301 million.
- Pacer International (PACR) said it now expects 2007 per-share earnings of $1.50 to $1.60, based on lower-than-forecasted revenue growth for the first quarter. Analysts polled by Thomson Financial are currently estimating 2007 earnings of $1.98 a share on revenue of $1.99 billion. The provider of third-party logistics and freight transportation also said that it has authorized the purchase of up to an additional $100 million of its common shares. Pacer said it plans to consolidate some of its operations, reduce the number of employees and invest in information technology systems. These and other initiatives could result in restructuring charges and increased expenses during 2007 and lower per-share earnings for the year, the company said. Pacer said it expects to reduce ongoing costs by about $10 million annually through its consolidation efforts.
- Parker Hannifin (PH) acquired Rayco Technologies, an Asian elastomer and seal technology company serving electronics and medical markets. Financial terms weren't disclosed. Parker Hannifin said Rayco's 2006 revenue was about $26 million and the deal will boost earnings in the first full year of operations.
- Robbins & Myers (RBN) reported second-quarter net earnings of $7.93 million, or 46 cents a share, up from $1.2 million, or 8 cents a share, during the year-ago period. The industrial-equipment maker posted revenue of $162.5 million vs. $150 million. Analysts polled by Thomson Financial had estimated second-quarter earnings of 47 cents a share. Robbins & Myers said it attributed the increase in earnings to strong sales growth and improvements in its cost structure. The company also raised its fiscal 2007 forecast on the strength of its backlog and continued favorable outlook. Robbins & Myers said it now expects fiscal 2007 per-share earnings of $2.20 to $2.40, up from its previous range of $2.10 to $2.30. Third-quarter earnings are expected to be from 52 cents to 62 cents a share, the company said.
- RedEnvelope (REDE) said that President and Chief Executive Ken Constable has resigned to pursue other business opportunities. The San Francisco-based online retailer said that John Pound, previously chairman, has been named executive chairman, and will assume day-to-day leadership duties.
- Saks (SKS) said Michael Archbold, executive vice president, chief financial and administrative officer of Saks Fifth Avenue, will resign effective April 13 to become CFO and chief operating officer of the Vitamin Shoppe. Archbold was slated to become CFO of Saks Inc. on May 4. New York-based Saks said it will not fill Archbold's position.
- Starbucks (SBUX) named Peter Bocian executive vice president and chief financial officer designate, effective May 14. The Seattle coffee retailer said Bocian most recently served as senior vice president and chief financial officer of NCR Corp. (NCR) . Bocian, 52 years old, replaces Michael Casey, who will transition into a senior advisory role, the company said.
- Tribune's (TRB) $8.2 billion buyout raises questions about how the media company plans to pay back more than $12 billion in debt.
- UAL Corp.'s (UAUA) United Airlines said traffic in March rose 1.6% compared with the year-ago period. Capacity increased 0.5% vs. last year, while load factor rose 1 percentage point to 85%, the Chicago-based carrier said.
- U.S. Trust Chief Executive Peter Scaturro is expected to step down this summer due to a series of disagreements with Bank of America Corp. (BAC) , according to a media report Thursday. Bank of America, which agreed in November to acquire U.S. Trust from Charles Schwab & Co. (SCHW) for $3.3 billion, confirmed Scaturro's exit in a statement, The Wall Street Journal reported. According to the report, sources said Scaturro has clashed with Bank of America executives over how the private-banking operation should be run.
- Winston Hotels (WXH) agreed to be acquired by Inland American for about $438 million, after canceling its merger with Wilbur Acquisition Holding.
- Xerox (XRX) named Ursula M. Burns president. The company also elected Burns to its board. She will report to Chairman and Chief Executive Anne M. Mulcahy. Burns was previously Xerox's president of business group operations. She joined the company in 1980. A company spokesman said Burns fills a new position.
- Asian trading closed with the Hang Seng +1.03%, Nikkei +1.74%, Shanghai +1.28%, Taiwan +0.90%, and Sensex +0.01%
- Looking over at Europe, we find the CAC +0.21%, DAX +0.20%, FTSE -0.27%, ATX +0.03%, Swiss Mkt. +0.01% and Stockholm -0.38%.
- Gold is trading +1.5 to 671.2 and crude oil is -0.23 to 64.41 this morning.
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