Stocks in the news Wednesday
From Standard & Poor's Equity ResearchIBM (IBM) posts $3.28, vs. $2.80 a year ago, fourth quarter EPS from continuing operations as widened gross margin, lower tax rate offset 6% revenue decline (-1% adjusting for currency). The Street was looking for fourth quarter EPS of $3.03. Sees 2009 EPS of at least $9.20. S&P reiterates strong buy. Bernstein raises estimate, rates outperform.
General Motors (GM) reports 11% drop in 2008 total sales, reflecting continuing global economic pressures that include tightening credit, falling commodities prices and lack of GDP growth. Says it sold more than 8.35 million vehicles globally last year. Says nearly 3% growth in both the Asia Pacific and Latin America, Africa and Middle East regions partially offset North America sales that decline 21%, and growing pressure in Europe that resulted in 7% fewer sales.
Northern Trust (NTRS) posts $1.39, vs. $0.97, fourth quarter operating EPS on 18% higher consolidated revenue, driven by record foreign exchange trading income, record net interest income.
Bank of New York Mellon (BK) posts $0.05, vs. $0.61, fourth quarter EPS from continuing operations on 5.6% decline in total fee revenue. At Dec. 31. Tier I capital ratio was 13.1%, vs. 9.3% at Sep. 30.
Google (GOOG) rises 14.17 to 296.92. S&P notes GOOG shares are higher today as comScore data indicate that growth in GOOG's U.S.-based searches with paid advertisements showed notable acceleration month over month in December, and year over year in the fourth quarter. S&P reiterates strong buy.
AMR Corp. (AMR) posts $1.22 fourth quarter loss per share, vs. $0.28 loss, on 3.8% revenue drop. Expects its full-year mainline capacity to decrease by more than 6.5% in 2009 vs. 2008, with a reduction of domestic capacity of about 9%, reduction of international capacity of more than 2.5%. S&P reiterates hold.
UAL Corp. (UAUA) posts $9.91 fourth quarter GAAP loss, vs. $0.47 loss, on 8.7% lower revenue. Notes fourth quarter 2008 loss totaled $4.22 excluding non-cash, net mark-to-market hedge losses and certain accounting charges. UAUA also said it is taking additional steps in 2009 to reduce overhead costs. These include the elimination of another 1,000 salaried and management jobs by the end of 2009. S&P views UAUA shares as high risk, reiterates hold.
PNC Financial Services Group (PNC) expects to report a fourth quarter loss due to integration costs, the additional provision for credit losses related to National City Corp. is substantially below previously disclosed estimates. Additionally, PNC expects to report a significantly strengthened capital position, and doesn't expect that it will need additional capital beyond the $7.6 billion obtained through TARP. S&P maintains hold.
General Electric (GE) falls 0.29 to 12.64. UBS Financial places a short-term sell rating on GE shares, saying 2009 expectations are still too high. UBS maintains 12-month neutral rating.
United Technologies (UTX) posts $1.23 (including $0.06 net benefit from one time gains in excess of restructuring costs), vs. $1.08 fourth quarter EPS despite 1.8% revenue decline. Street was looking for $1.22. Reaffirms 2009 EPS of $4.65-$5.15 (excl. impact of any acquisition related costs resulting from adoption of SFAS 141).
BlackRock (BLK) posts $0.40, vs. $2.43, fourth quarter EPS on 26% revenue decline. Although AUM closed the quarter up $48.6 billion, says company suffered an $80.5 billion decline in asset values due to adverse markets and foreign exchange movements.
Coach (COH) posts $0.67, vs. $0.69, second quarter EPS on 1.8% lower total sales (excluding forex). Withdraws guidance for balance of fiscal year 2009. Has revisited its domestic store opening goals for fiscal year 2010 with an eye toward reducing the number of new stores from its current run rate of 40 North American retail locations per annum to about 20, while also suspending retail store expansions.
Analog Devices (ADI) expects first quarter revenue to decline by about 25%-30% compared to fourth quarter fiscal year 2008, due to additional weakness in end demand and inventory reductions across supply chain. Mid-point of this revised revenue outlook would lead to EPS from continuing operations of $0.15-$0.17, excl. restructuring charges, which ADI is unable to determine at this time.
Packaging Corp. of America (PKG) posts $0.30, vs. $0.42, fourth quarter EPS on 5.9% sales decline. Cites significantly lowered volume and increased production downtime and costs, higher costs for energy, chemicals, and labor. Street was looking for $0.25. Sees first quarter EPS of about $0.20. S&P maintains buy.
SPX Corp. (SPW) initiates a number of restructuring actions for 2009 totaling as much as $65 million in restructuring charges. Expects 2009 revenue to decline between 7%-12% to about $5.3-$5.6 billion, EPS from continuing operations are expected to be down 10%-16% to about $5.40-$5.80.
Allegheny Technologies (ATI) posts $1.15, vs. $1.45, fourth quarter EPS on 13% lower revenue. Says the combination of the continuing credit crisis and the global recession has resulted in challenging conditions in many of its markets.
Omnicell (OMCL) sees 2008 results consistent with previous guidance of 18% rev. growth, at higher end of $0.65-$0.70 non-GAAP EPS guidance, excl. stock compensation expense. Expects $0.30-$0.35 2009 non-GAAP EPS, excl. stock compensation expense, on $200-$210 million revenue. BB&T Capital downgrades to underweight from buy.
Riverbed Technology (RVBD) expects $0.29-$0.33 fourth quarter GAAP EPS ($0.18-$0.19 non-GAAP) on revenues of about $91-$92 million, representing a record for company quarterly revenue, and about 20% year-over-year growth. These preliminary fourth quarter revenue and non-GAAP EPS results exceed the company's prior guidance. Separately, company agrees to acquire Mazu Networks for about $25 million cash, with additional payments of up to $22 million possible based on future sales performance.
Labranche & Co. (LAB) posts $0.05, vs. $0.29, fourth quarter EPS on 21% lower revenue.
Cash America International (CSH) sees fourth quarter net income, excluding one-time and unusual items, about 15% below fourth quarter 2007. Cites much lower storefront cash advance revenue, higher expenses related to recently enacted regulation of this product in Ohio, slightly elevated loss rates for online cash advance product, heavier discounting on retail sale of merchandise during Christmas selling season. Also cuts $3.35-$3.55 2009 EPS guidance to $3.10-$3.30, including interest in Prenda Facility.
Abbott Laboratories (ABT) posts $0.98, vs. $0.77, fourth quarter GAAP EPS on 10% sales rise. Confirms previously issued 2009 EPS guidance of $3.65-$3.70 under both GAAP, non-GAAP bases.
Cree (CREE) posts $0.12, vs. $0.08, second quarter GAAP EPS on 24% higher revenue. For third quarter, sees $0.02-$0.05 GAAP EPS, $0.10-$0.13 non-GAAP EPS on revenue of $128-$135 million.
CSX Corp. (CSX) posts $0.90, vs. $0.85, fourth quarter EPS from continuing operations (excl. items) on 4% revenue rise. The gains were driven by higher yields and fuel recovery, which more than offset the impact of significantly lower volumes.