Spotlight Stocks: Ambac, Barclay's, Delta, Wal-Mart
Tuesday's top stories and stocks with potential to move.
Stocks to watch for Tuesday, February 19, 2008:
- Ambac Financial (ABK) CEO Michael Callen said the company is considering a split into two different companies. Investors are showing interest in two separate aspects of the business, insuring municipal bonds and guaranteeing structured finance products like collateralized debt obligations. The company is also planning to raise $2 million in capital by selling shares to existing investors at a discount.
- Barclay's (BCS) upped its 2007 writedown total on the value of risky assets to 1.6 billion pounds ($3.1 billion). The company also reported quarterly profits were in line with expectations. Barclays reported a 2007 pretax profit of 7.08 billion pounds, down from 7.14 billion in 2006.
- Delta Airlines (DAL) and Northwest Airlines (NWA) are close to completing a merger that would create the world's largest airline by traffic, reported the Wall Street Journal. The remaining snag is with the companies' unionized pilots over a merged seniority program.
- Wal-Mart (WMT) reported net income rose to $4.096 billion, or $1.02 cents a share, up 4% from $3.94 billion, or 95 cents a share a year ago for the quarter ended January 31. The figure includes a 3 cents a share charge for dropped real estate projects and restructuring in Japan.
- Credit Suisse (CS) reported a writedown of $2.85 billion off the value of its asset-backed investments and revelaed mismarking and pricing errors on its books, reported Reuters. The company said the writedowns could take $1 billion off its 1Q net income.
- General Electric (GE), in an effort to end an SEC probe into its accounting, plans to change its policies. GE has twice restated its financial results, has made three disclosures over additional accounting errors since 2005 and also has disciplined or fired several employees, according to the WSJ. The policy changes include adding staff in corporate accounting to review revenue matters and bolstering the internal-audit department.
- UBS (UBS) was downgraded by Bear Stearns to peer perform from outperform Monday. Bear called the bank's remaining exposure to risky mortgage debt "shocking" and said further write-downs are on the way.
- Asian trading closed with the Hang Seng +1.53%, Nikkei +0.90%, Sensex +0.15%, Taiwan +1.69% and Shanghai +2.10%.
- A quick check towards Europe finds the CAC +0.34%, DAX +0.18%, FTSE +0.68%, ATX +0.46%, Swiss Mkt. -0.09% and Stockholm +0.84%.
- In commodities, crude oil is trading up +2.10 to 97.60 and gold is also rising +12.7 to 915.5 this morning.
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