ConAgra Recalls Beef in Bacteria Scare

FDA probes Johnson & Johnson; UAL's loss narrows; plus more of today's stocks in the news

ConAgra (CAG ) is recalling more than 18.6 million pounds of fresh and frozen ground beef because of potential bacteria contamination.

Ericsson (ERICY ) posted a narrower Q2 loss of $296 million -- meeting expectations. The Swedish mobile-phone maker will cut another 5,000 jobs to cut costs, and warned that sales of mobile phones this year will fall more than 15% from 2001 levels, down from a previous forecast of a fall of more than 10%. The company also said it would issue eight billion new shares at a discount, to raise money for new financing.

Merrill Lynch downgraded Johnson & Johnson (JNJ ) after the New York Times said the FDA is conducting a criminal investigation of its Puerto Rico factory that makes Eprex, J&J's anemia drug. An employee filed a lawsuit alleging he was pressed to falsify data to cover up manufacturing lapses. J&J says the product's integrity "has never been compromised."

Ask Jeeves reportedly dropped Overture Services (OVER ) as its partner in the paid search business; Ask Jeeves inked a three-year advertising deal with Google. USB Piper says the loss of Ask Jeeves is of little consequence to the company.

Minerals Technologies (MTX ) says International Paper plans to talk with other suppliers as the two companies' contract is near expiry. As a result, International Paper will shorten the depreciation schedules of Mineral Tech's satellite plants. Minerals Tech cut its 2002 EPS guidance to $2.78-$2.83.

Merck (MRK ) posted Q2 EPS of $0.77 vs. $0.78 a year ago.

Consolidated Energy (CNX ) cut the $0.25-$0.30 Q2 EPS guidance to $0.11. ConEd says it expects the board to reduce its quarterly dividend from $0.28 to $0.14 per share. Merrill Lynch downgraded to near term and long term neutral.

Guidant (GDT ) says the FDA approved an expanded indication for the company's implantable cardioverter defibrillators. Guidant posted $0.53 Q2 EPS and sees double digit sales and EPS growth for the second half. S&P and AG Edwards upgraded.

McData (MCDTA ) is higher after posting a $0.02 Q2 loss vs. $0.04 EPS (pro forma) on a 5% revenue drop, and sees a $0.01-$0.02 Q3 loss. Merrill Lynch and Deutsche Bank upgraded. S&P keeps avoid.

Nicor (GAS ) shares tumbled after the company said regulators are reviewing allegations that it acted improperly in reporting benefits related to its performance-based rate (PBR) program. Merrill and Goldman downgraded; S&P keeps avoid, saying the market has no patience for accounting irregularities.

UAL Corp. (UAL ) posted a $6.99 Q2 loss (basic), excluding items on 19% lower operating revenue, and says its cash burn is likely to be worse in Q3, and further deteriorate in Q4. S&P reiterates avoid.

DaimlerChrysler (DCX ) reportedly is being investigated by the Dept. of Justice for price fixing.

T Rowe Price (TROW ) posted $0.40 vs. $0.40 Q2 EPS. S&P downgraded to hold from accumulate.

AOL Time Warner's (AOL ) chief operating executive Robert Pittman resigned Thursday, and two top executives from the Time Warner side of the company were promoted to senior positions. S&P reiterates avoid; Wit SoundView downgraded to neutral from outperform.

Microsoft (MSFT ) posted fourth quarter 2002 earnings per share of $0.28 vs. $0.01 a year ago, led by demand for enterprise products. Revenues jumped 10% to $7.25 billion from $6.58 billion a year ago -- beating Wall Street's expectations. Microsoft's earnings per share included a one-time investment impairment charge of $806 million; the company also warned that the "current environment remains challenging." S&P keeps accumulate.

Sun Microsystems (SUNW ) posted fourth quarter earnings per share of $0.01 vs. a loss of $0.03 a year ago, marking a return to profitability for the maker of servers for networks. However, Sun's revenue fell 14% to $3.4 billion amid the tough environment for information technology spending. Bear Stearns cut estimates; S&P reiterates hold.

Goldman Sachs removed PepsiCo (PEP ) from its recommended list, and now the soft-drink manufacturer as market perform. S&P reiterates buy. The company posted $0.52 vs. $0.45 Q2 EPS on a 2.3% sales rise, saying it's confident it will meet its 13%-14% 2002 EPS growth target. Pepsi set a $5 billion stock buyback.

eBay (EBAY ) posted $0.19 vs. $0.09 Q2 EPS on a 47% revenue rise, and sees $0.19 Q3 EPS on revenue of $278M-$281M. Pacific Crest reportedly downgraded; CS First Boston raised estimates. S&P keeps accumulate.

Adams Harkness downgraded KLA-Tencor (KLAC ) to market perform from buy.

Symbol Technologies (SBL ) posted $0.04 vs. $0.03 Q2 EPS from operations despite a 7.2% revenue decline, and still sees 2002 revenue of about $1.3B, and sees EPS from operations of $0.20-$0.25. Gerard Klauer upgraded to buy. S&P keeps hold.

Photronics (PLAB ) sees a $0.01 Q3 loss to $0.01 EPS on sales of $96M-$98M, or 5%-7% below a year-ago's $103M. CIBC World downgraded, citing pricing pressure and soft demand for photomasks.

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