Zale Shares Dip on Flat Profit Outlook

CIBC World keeps buy on Select Medical; Qualcomm gains on news of China Unicom deal; and other stocks in the news

Zale Corp. (ZLC ) posted $0.14 Q3 EPS from operations on a 7.3% same store sales decline. Zale expects flat profit performance for fiscal 2002. Janney Montgomery downgraded. Merrill Lynch downgraded to near term neutral from near term accumulate.

Select Medical (SLMC ) posted $0.13 vs. $0.03 Q1 EPS on a 14% revenue rise. CIBC World reiterates strong buy.

Qualcomm (QCOM ) said China Unicom, China's second largest telecom service operator, awarded over $1.5B vendor contracts to build wireless network using QCOM's CDMA technology. S&P maintains hold.

Robertson Stephens upgraded Sonic Automotive (SAH ) to strong buy from buy.

Merrill says Bally Total Fitness (BHT ) stock sold off last week on in-line Q1 earnings. Merrill thinks investors are just jumping back in, and rates the stock near and long-term buy.

Pacific Crest upgraded i2 Technologies (ITWO ) to buy from market perform.

JC Penney (JCP ) posted $0.11 vs. $0.13 Q1 EPS on a slight sales decline. The clothing retailer sees a $0.20-$0.25 Q2 loss, citing weak catalog business. S&P maintains neutral.

Protein Design (PDLI ) posted $0.14 vs. $0.02 Q1 EPS on 69% revenue rise. S&P maintains hold and CS First Boston raised the target. Dain Rauscher reiterates strong buy.

Wit SoundView downgraded Verity Inc. VRTY ) to hold from strong buy.

Wit SoundView reiterates strong buy on shares of RF Micro Devices (RFMD ) and raised the $27 price target to $30.

JP Morgan upgraded Abbott Labs (ABT ). On Monday Abbott said a Phase II study showed its ABT-627 significantly delayed the progression of hormone-refractory prostate cancer.

Deere Co. (DE ) posted $0.54 vs. $0.87 Q2 EPS on slightly lower sales. Deere expects sales of commercial and consumer equipment to remain well below last year's levels.

Zale Corp. (ZLC ) posted $0.14 vs. $0.30 Q3 EPS from operations on a 7.3% same store sales decline. Zale expects flat profit performance for fiscal 2002 as both internal and external factors are negatively impacting business.

Lehman Brothers expects Ciena Corp.'s (CIEN ) management to convey a more cautious tone than in the past on a conference call following the May 17 Q2 release.

CanTV (VNT ) is seen higher on talk that AT&T and others want a stake in the company.

Carriage Service (CSV ) posted $0.22 vs. $0.11 Q1 EPS despite a 2.8% revenue decline. Carriage sees $37M-$39M Q2 revenues and $0.07-$0.09 EPS, and $154M-$158M 2001 revenues with $0.38-$0.42 EPS.

4Kids Entertainment (KDE ) posted $0.40 vs. $0.71 Q1 EPS on a 41% revenue decline.

Goldman Sachs cut estimates on Campbell Soup (CPB ) and believes the fair value for the stock is in the $23-$25 per share range.

Banc of America widened its $0.12 Q3 loss estimate on shares of Micron Technology (MU ) to a $0.31 loss to reflect near-term uncertainty and risks associated with DRAM pricing and demand.

Charles Schwab (SCH ) announced total client daily average trades were 235,000 in April 2001, down 39% from April 2000 and flat from March 2001.

Motorola (MOT ) disclosed that Turkey's Telsim has not yet paid over $700M in loan commitments. Separately, Motorola says China Unicom awarded the company a total of $407M in CDMA contracts.

Lynx Therapeutics (LYNX ) and Hybrigenics S.A. announce the discovery of a novel therapeutic target candidate for the treatment of obesity.

Parthus Technology (PRTH ) launched MachStream, an application acceleration platform using hardware-based JIT tech. The company agreed to acquire Chicory Systems Inc., which developed the technology, for accelerating its mobile Internet applications.

Satyam Computer (SAY ) offered an initial 14.5M ADSs at $9.71.

AOL Time Warner's (AOL ) America Online and the Sony Entertainment unit of Sony Corp.'s (SNE ) announced a pact to develop next-generation entertainment, with certain AOL services available on Sony's PlayStation2.

Wal-Mart (WMT ) posted $0.31 vs. $0.30 Q1 EPS on a 12% total sales rise. The discount retail operator increased its buyback program to $3 billion.

Gemstar-TV Guide (GMST ) posted $120M vs. $57M Q1 EBITDA on a sharp revenue rise. The company agreed to acquire Skymall Inc. (SKYM ) for $3.00 per share in cash and stock. S&P and Salomon Smith Barney reiterate buy.

OpenTV (OPTV ) says it has been selected by China's largest cable TV network, Shanghai Cable Network Co. Ltd., to provide and interactive platform and an array of interactive and multimedia services.

Silicon Valley Group (SVGI ) widened its forecast for a 15%-25% Q3 sequential revenue drop to 30%-40%, citing additional customer requests to delay shipment of its product. The company will reduce headcount by about 400 (10%).

Home Depot (HD ) posted $0.27 vs. $0.27 Q1 EPS on flat same store sales. The home-improvement chain says it is comfortable with $0.37 Q2 EPS forecasts.

Hain Celestial (HAIN ) posted $0.12 vs. $0.28 Q3 EPS from operations on a 4.2% revenue decline. The company sees 20% EPS growth for fiscal 2002 on double digit revenue growth. S&P and Lehman Brothers cut estimates.

Computer Science (CSC ) posted $0.36 vs. $0.84 Q4 EPS as higher costs offset a 13% revenue rise. The firm sees high-$0.20s Q1 EPS and $2.25-$2.35 for fiscal 2002. S&P maintains hold but cuts estimats. UBS PaineWebber also cuts estimates.

Pacific Sunwear (PSUN ) posted $0.11 vs. $0.18 Q1 EPS from operations on 3.3% lower same store sales and 22% higher total sales. Merrill Lynch, Wedbush Morgan and UBS PaineWebber upgraded the shares.

Suntrust Banks (STI ) agreed to acquire institutional business of Robinson-Humphrey Co. LLC from Citigroup's Salomon Smith Barney unit. The terms weren't disclosed.

Williams-Sonoma (WSM )posted $0.20 vs. $0.08 Q1 EPS on 2.8% lower total comp-store sales and lower gross margin. For Q2, the kitchen goods company sees a range of a $0.20 Q2 loss to $0.20 EPS on negative comp-store sales.

US Oncology (USON ) notes a study reported that Taxol (paclitaxel) plus Estramustine is a safe, effective treatment for hormone-refractory prostate cancer patients.

Longs Drug Store (LDG ) posted $0.34 vs. $0.31 Q1 EPS from operations on 6.6% higher same store sales and 8% higher total sales. The company sees Q2 same store sales growth of about 6.5% with $0.35-$0.38 EPS, and $1.60-$1.65 fiscal 2002 EPS from operations.

Microsemi Corp. (MSCC ) will be added to the S&P SmallCap 600 after close on a date to be announced, replacing Silicon Valley Group, which is being acquired.

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