Bristol-Myers Sued over Generic Cancer Drug

Knight Trading denies trading allegations; Flextronics finishes lower; plus more of today's stocks in the news

Bristol-Myers Squibb (BMY ) is being sued by several states on allegations that the company improperly sought to delay generic competition for its widely used anti-cancer drug Taxol.

Continental Airlines (CAL ) says May jet passenger revenue per available seat mile (RASM) fell 6%-8%, and notes June RASM would have to be about 14% higher year over year for the company to be profitable in Q2.

United Natural Foods (UNFI ) posted $0.27 vs. $0.17 Q3 EPS on a 16% sales rise and sees $0.28-$0.30 EPS from operations. S&P keeps accumulate. RBC Capital tied weakness to no news on the company's Wild Oats contract.

Knight Trading (NITE ) is the subject of a probe by the SEC and NASD into allegations that it illegally engaged in improper trading during the tech boom, according to a press report. The company says Tuesday's press article in The Wall Street Journal was based on a private arbitration matter made public, in what the company thinks may be an attempt by the plaintiff to reap personal gains. Knight also says the allegations are unfounded and without merit.

Wachovia says worries over FactSet Research 's (FDS ) mutual fund rationalization and weak equity prices is decreasing investors' confidence in the stock.

Morgan Stanley upgraded EGL Inc. (EAGL ) to equal-weight from underweight.

Flextronics (FLEX ) sees lower than expected first quarter EPS of $0.05-$0.08 (pro forma) on $3 billion in revenue, and $0.07-$0.10 second quarter EPS on revenue of $3.2 billion. Robertson Stephens cut its estimates.

Caminus cut second quarter EPS (pro forma) guidance to $0.03, and 2002 EPS to $0.55. CEO David Stoner to retire. It also set a $10 million stock buyback. Wachovia downgraded the stock to hold, while Robertson Stephens cut estimates.

Deutsche Bank reportedly says estimates for Sanmina-SCI (SANM ) and Solectron (SLR ) are at significant risk.

Lehman cut AOL Time Warner (AOL ) estimates.

IBM Corp. (IBM ) announces deal to form disk drive joint venture with Hitachi. S&P keeps accumulate recommendation.

Walgreen (WAG ) posts 11% higher May same store sales, 17% higher total sales. S&P keeps accumulate ranking.

Lehman upgraded Pier 1 Imports (PIR ) to strong buy from buy.

St. Paul Cos. (SPC ) entered into a pact to settle all asbestos and all other claims arising from an insuring relationship that existed prior to 1961. It says the after-tax impact on earnings will be about $380 million. S&P maintains its hold opinion.

PetSmart (PETM ) posted first quarter EPS of $0.17 vs. $0.01 on 12% higher same store sales. The company sees $0.14-$0.15 second quarter EPS; it raised its fiscal 2003 EPS guidance to $0.66-$0.69.

Brocade (BRCD ) reaffirmed financial guidance for Q3 and Q4 of $0.08 EPS on revenue of $145-$150 million and $0.10 EPS on revenue of $160-$165 million, respectively. SoundView reiterated its strong buy rating.

Activision (ATVI ) raised its Q1 guidance to $0.18 EPS on revenues of $165 million, and for fiscal 2003 to $1.10 EPS on revenues of $890 million, citing the strength of international markets and a strong global response to its products. CS First Boston and Goldman raised estimates.

UTStarcom (UTSI ) signed contracts valued at about $40 million to deploy its PAS, IP-Based PAS city-wide wireless access system in a number of cities in the Jiangxi, Sichuan, Shaanxi provinces of China. CS First Boston reiterated its strong buy opinion.

MGM Mirage (MGG ) says it has withdrawn its proposal to acquire Emerald Casino, as the action of the Illinois legislature to increase the gaming tax to as much as 50% makes the proposal uneconomic.

SoundView downgraded Veritas (VRTS ) to buy from strong buy.

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