Ticker Shock: GE, PacSun Get Hostile; JDS, MetLife Get Bland
Thursday's top stories and stocks with potential to move.
We were looking pretty good yesterday - until the last 15 minutes or so.
Anyway, Asia was up big - the Nikkei more than 9%, the Hang Seng more than 12%. Europe is showing me some green as well. And as I'm sure you all know by now, we're off to a solid open here in the States as well.
General Electric (GE)
Dow Jones has issued, is issuing or is going to issue a clarification of a piece it ran on GE. Yesterday, Dow reported that "aims at keeping profits at the same level as this year despite the financial crisis, even if revenue falls 10 to 15%...A spokesman for GE said the report quoting [CEO Jeffrey] Immelt was "completely out of context and inaccurate."
All of this is an issue, because some blamed yesterday's action in and around the close on the GE news.
My take: I think this "news" should be ignored. Regarding the stock as a value, I continue to maintain the same position that I did earlier this month: I believe the stock is a good longer-term play. However, for a variety of reasons, I remain skeptical about calling a bottom. Regarding its potential for today: I think it trades higher with the market.
JDS Uniphase (JDSU)
The one-time high flyer and must-own reported a fiscal first-quarter loss of $0.08 per share after the close yesterday. That had me a bit concerned, at first blush. But non-GAAP EPS for the quarter came in at $0.11. The Street was reportedly looking for $0.09.
On the flip side, its top line came in at $380.7 million, which was a decent jump over the $356.7 million it put up in the comparable period last year. However, it was apparently about $5 million and change shy of what analysts had been looking for.
Let me just put it as plainly as I can. I'm not betting against the company, but I just can't get motivated to buy the shares. And if insiders aren't flocking to the stock, with the shares near their 52-week low, why should I?
"Get Met. It pays." I don't know about that, but after the close on Wednesday, the well-known insurer disseminated its third-quarter numbers.
Its income from continuing ops came in at $1.42 per share. No big surprises there, because as I reported back on October 8th, the company had said it was looking for $1.38 to $1.58 a share from continuing ops.
Seriously, all in all, I thought Snoopy's release was pretty ho-hum. And though I think the stock will probably bounce today (with the market, and because there didn't appear to be any nasty surprises), I'm still not overly impressed. In this market, I think there are other stocks I'd rather bottom-fish first.
Pacific Sun (PSUN)
Earlier in the month, PacSun got an acquisition offer of $4.50 per share from apparel company Adrenalina. It rejected it. News reports suggest that Adrenalina upped the ante to $5. But apparently PacSun is taking a pass on that as well.
My immediate thought: This is good news. Someone apparently wants to buy these guys at what seems like a steep premium on the current market price.
However, there's a chance this thing could get hostile. And while there's a chance that shareholders could still make out, a battle could be time-consuming, distracting and expensive.
What makes me think it could go hostile?
Adrenalina's CEO said the company believes "the PacSun board of directors has rejected our acquisition proposal hastily and without full consideration... Therefore, our next option is to present our proposal directly to PacSun's shareholders at a shareholders meeting."
Have a great day!
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