McData Moves Higher

Molex rebounds; ImClone reportedly to present new cancer-drug data; plus more of today's stocks in the news

McData (MCDTA ) posted 6 cents first-quarter earnings per share vs. a 4-cent loss on a 60% revenue rise, and 5 cents first-quarter earnings per share (GAAP). McData sees 6 cents to 7 cents second-quarter earnings per share (excluding a charge) on $106 million to $110 million revenue. S&P reiterates avoid. SG Cowen upgraded.

Fiber-optics systems maker Molex (MOLX ) sees fourth-quarter revenues at the higher end of the $450 million to $460 million guidance, and 1 cent EPS, as well as 15 cents to 16 cents (excluding a charge) vs. the previous 14 cents guidance. Molex will take a $38 million to $40 million fourth-quarter restructure charge. S&P reiterates avoid.

ImClone (IMCLE ) data is to be presented this weekend at a big cancer meeting, and is expected to suggest that its experimental cancer drug, Erbitux, in fact, works, according to The Wall Street Journal.

S&P notes Novellus Systems (NVLS ) confirmed the prior second-quarter $238 million in sales, and the 5 cents earnings per share. S&P reiterates buy. Goldman believes investors should begin to be more aggressive on Novellus.

AOL Time Warner (AOL ) and Microsoft (MSFT ) and settled a 2002 antitrust lawsuit filed by AOL on behalf of its Netscape unit. Microsoft will pay AOL $750 million. The deal includes an agreement between the two companies to collaborate on digital media initiatives to bolster adoption of digital content. S&P reiterates accumulate on AOL, while Kaufman Bros. reiterates buy.

Halliburton (HAL ) said it signed a memorandum of understanding to settle about 20 shareholder class-action lawsuits concerning claims for the purchase of the oilfield service company's stock over a four-year period.

Schering-Plough (SGP ) says the U.S. Attorney's Office for the District of Massachusetts advised that its Schering Corp. unit is the target of a federal grand jury investigation.

Wedbush Morgan upgraded Broadcom (BRCM ) to buy from hold.

Needham initiated coverage of Sigma Designs (SIGM ) with strong buy.

J.P. Morgan initiated coverage of Furniture Brands (FBN ) and Ethan Allen (ETH ) with overweight.

UBS Warburg upgraded NVIDIA (NVDA ) to buy from reduce.

Janney Montgomery downgraded Packeteer (PKTR ) to sell from hold.

S&P thinks RealNetworks (RNWK ) will be adversely affected by the new browser technology collaboration of AOL Time Warner and Microsoft. S&P reiterates sell.

3Com (COMS ) sees $165 million to $175 million in fourth-quarter revenues, excluding revenue from CommWorks. Excluding CommWorks, 3Com sees gross margins in the mid-30%s, adversely impacted by a decline in sales. Pacific Growth downgraded to underweight.

Merrill downgraded Penn National Gaming (PENN ) to neutral from buy.

UBS Warburg downgraded Monster Worldwide (MNST ) to neutral from buy.

Integrated Device (IDTI ) maintains its 2%-4% higher first-quarter revenue gudiance. S&P upgraded.

Bank One (ONE ) will acquire Zurich Life, the U.S. life and annuity business of Zurich Financial Services Group, for about $500 million. Bank One sees a $50 million boost to 2004 net income before any revenue synergies.

USB Piper reportedly downgraded Citigroup (C ) to outperform from strong buy.

Dollar Tree (DLTR ) posted 29 cents vs. 25 cents first-quarter earnings per share on a 2.2% same store sales rise, and a 21% total sales rise. CIBC World downgraded to underperform from sector perform, and S&P downgraded to hold.

Home Depot (HD ) set a $500 million stock buyback.

Mandalay Resort (MBG ) posted 69 cents vs. 68 cents first-quarter earnings per share on flat revenue. S&P reiterates accumulate.

Michaels Stores (MIK ) posted 30 cents vs. 16 cents first-quarter earnings per share (including an accounting change) on a 2% same store sales rise and an 8.8% total sales rise.

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