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Stocks To Watch: Borders, Dell, FedEx, Fremont, Motorola, Starbucks


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


Stocks to watch for Thursday, March 22:

  • Acme Communications (ACME) late Wednesday reported a fourth-quarter net loss of $1.63 million, or 10 cents a share, compared with $5.64 million, or 13 cents a share, in the year-ago period. Revenue at the television station operator fell to $8.45 million from $8.63 million. Acme expects first quarter 2007 revenue for its continuing television stations to decrease in the low single digits compared to the same quarter last year.
  • Adams Respiratory Therapeutics (ARXT) said it has entered into a settlement agreement with Pharmaceutical Holdings Corp. subsidiaries Mutual Pharmaceutical Co. and United Research Laboratories Inc. relating to the patent infringement lawsuit filed by Adams in the U.S. District Court for the Eastern District of Pennsylvania on Oct. 4, 2006. Adams said the patent covers its extended-release guaifenesin single-agent and combination products.
  • Affiliated Computer Services (ACS) confirmed it has received a $59.25-per-share offer from Chairman Darwin Deason and Cerberus Capital Management L.P. to take the company private. The deal would be worth more than $8 billion including the assumption of ACS debt. The outsourcer of information-technology services said a special committee of independent directors has been formed to evaluate strategic alternatives, including the proposal from Deason and Cerberus. The committee expects to make a recommendation "in due course," the company said.
  • Amerigroup (AGP) cut its full-year 2007 profit forecast to account for costs associated with securing litigation-related financing.
  • Beazer Homes (BZH) Chief Financial Officer James O'Leary is resigning, effective March 23, to become president and chief executive of Kaydon (KDN), the companies said.
  • Borders (BGP) plans to reopen an e-commerce Web site and end an alliance with Amazon (AMZN), shed most overseas stores and shut many Waldenbooks outlets.
  • Chubb's (CB) board increased the share buyback program by 20 million shares. The insurance holding company said purchases may be made in the open market or in privately negotiated transactions.
  • Citi Trends (CTRN) reported fourth-quarter net earnings of $10.4 million, or 73 cents a share, up 31% from $7.92 million, or 55 cents a share, during the year-ago period. The retailer posted revenue of $126.8 million vs. $96.8 million. Analysts polled by Thomson Financial had forecast fourth-quarter earnings of 70 cents a share on revenue of $126 million. Same-store sales for the quarter rose 1.3% on a comparable-weeks basis. Additionally, Citi Trends said it still expects fiscal 2007 earnings of $1.73 to $1.77 a share, and a same-store sales increase in the low-single digits. Analysts are currently looking for earnings of $1.48 a share for the year. For the first quarter, the company said it sees per-share earnings of 44 cents to 49 cents.
  • Clarcor's (CLC) first-quarter net income rose slightly to $16.4 million, or 32 cents a share, from $16.2 million, or 31 cents a share, a year earlier. The maker of filtration and industrial packaging products said sales for the quarter ended March 3 fell 1.7% to $209.5 million from $213.2 million a year ago. On average, analysts polled by Thomson Financial predicted first-quarter earnings of 36 cents a share and revenue of $222 million. Clarcor reaffirmed its 2007 earnings range of $1.67 to $1.77 a share, expecting domestic growth to rebound beginning in the second quarter.
  • Dell (DELL) unveiled a compact desktop computer with a base price of about $335, to target novice users in rapidly developing economies. The device will be sold first in China, then in other countries, including India and Brazil.
  • FedEx (FDX) reported a 1.9% drop in fiscal third-quarter net and forecast weak full-year growth, blaming a downturn in shipment volume and the firm's thin inventories.
  • Fremont General (FMT) said it plans to sell $4 billion in subprime loans, which will result in a $140 million pretax loss.
  • Herman Miller (MLHR) reported fiscal third-quarter net earnings of $32.3 million, or 50 cents a share, up 44% from $22.4 million, or 33 cents a share, in the year-ago period. The company said revenue in the three months ended March 3 rose 14% to $484.8 million from $424 million in the same period last year. Analysts polled by Thomson Financial were expecting a per-share profit of 52 cents on revenue of $491 million. The furniture maker expects fiscal fourth-quarter net earnings of 47 cents to 51 cents on revenue of $485 million to $505 million.
  • Intuit (INTU) said its TurboTax federal unit sales through March 17 rose 1% to 10.9 million from 10.8 million a year earlier. The provider of business and financial management services expects total unit growth of 3% to 5% for the full season. Intuit also reaffirmed its segment revenue growth forecast of 10% to 15% and its fiscal 2007 outlook.
  • Computer hard-disk maker Komag (KOMG) said it expects its first-quarter revenue to be better than it previously forecast. Komag estimates its sales to be slightly above its 2006 fourth-quarter revenue of $255.9 million; it previously forecast first-quarter sales to be down 2% to 3% from the fourth quarter. The company also said its net margins should be below the midpoint of its earlier forecast of a range of 12% to 14%.
  • The Job Network LLC, a unit of Lee Enterprises (LEE), entered a strategic partnership with Yahoo's (YHOO) HotJobs unit. Financial terms weren't disclosed. The agreement will allow the Job Network's members, made up primarily of community newspapers, to post employment ads on the HotJobs website.
  • Ligand Pharmaceuticals (LGND) plans to pay a dividend of about $253 million, or $2.50 a share. The developer of small-molecule drugs said the dividend is payable April 19 to shareholders of record April 5. Ligand's board also authorized up to $100 million in share repurchases over the next 12 months, the company said.
  • Motorola (MOT) said it will post a first-quarter loss and lower-than-expected full-year profit due to problems in its handset unit. Shares slid 5% in after-hours trading.
  • PDI (PDII) said a large pharmaceutical company customer notified the company it wouldn't renew its contract sales engagement with PDI when it expires May 12. The provider of commercialization services to biopharmaceutical companies said the contract was for one year and $35 million. Chief Executive Michael Marquard said the failure to renew the contract was disappointing and underscores PDI's diversification strategy.
  • Starbucks (SBUX) lured Paul McCartney to its Hear Music record label and said it plans 10,000 more stores over four years.
  • Radio One (ROIAK) reported a preliminary fourth-quarter net loss of $22.9 million, or 23 cents a share. During the same period a year ago, the company posted net earnings of $9.53 million, or 10 cents a share. Net broadcast revenue fell to $86.2 million from $90.6 million. Radio One said the results, which are preliminary pending a previously planned restatement, reflected "another soft quarter for the radio industry." The company also said its problems were isolated to the single market of Los Angeles. Radio One said it has received a letter of informal inquiry from the Securities and Exchange Commission regarding stock option accounting.
  • Raytheon (RTN) said it has increased its annual dividend by 6% $1.02 from 96 cents a share.
  • RCM Technologies (RCMT) reported fourth-quarter net earnings of $2.33 million, or 19 cents a share, up from $819,000, or 7 cents a share, during the year-ago period. The company posted revenue of $54.2 million vs. $46.8 million.
  • Sigma Designs (SIGM) said its fiscal fourth-quarter revenue tripled and that the company's board is still conducting a review of its stock-option practices. Revenue for the quarter jumped to $31.2 million from $10.5 million due to strong growth for telco-based IPTV deployments and increased shipments of media processor chips. The stock-option review isn't complete, and Sigma won't be able to announce financial results that include stock-based compensation. As a result, the company may miss the deadline for filing its financial report and that prior financial statements shouldn't be relied upon.
  • Wells Fargo (WFC) said it has authorized a stock buyback of up to 75 million shares. The San Francisco-based banking giant has roughly 3.4 billion shares outstanding. Wells Fargo shares rose 2.5% to close at $35.48 on Wednesday.

Market Update

  • Asian trading closed with the Hang Seng +0.89%, Nikkei +1.49%, Sensex +2.80%, Taiwan +0.86% and Shanghai +0.45%.
  • Looking over at Europe, we find the CAC +1.23%, DAX +1.70%, FTSE +0.63%, ATX +1.67%, Swiss Mkt. +1.12% and Stockholm +1.15%.
  • Gold is trading +5.00 to 665.0 and crude oil is +1.02 to 60.63 this morning.
No positions in stocks mentioned.

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