Deere Tumbles

Wal-Mart falls on disappointing guidance, Northwest Airlines gets upgraded, plus more of Tuesday's stocks in the news

Deere & Co. (DE ) posts lower-than-expected $1.58, the same as a year ago, third-quarter earnings per share despite an 11% sales rise. It sees fiscal year 2005 sales up 8% and fourth-quarter sales down about 9%. The company says retail sales in several key markets have been negatively affected by dry weather.

Wal-Mart (WMT ) said its second-quarter earnings rose 5.8% to $2.8 billion, or 67 cents per share. The figures were higher than analysts' expected but lower than the retailer's own targets. The giant retailer sees lower-than-expected 55-59 cents third-quarter earnings per share, and $2.63-$2.70 for fiscal year 2006. S&P reduces target price, but keeps strong buy opinion.

Home improvement retailer Home Depot (HD ) reported that second-quarter profit rose 14% to $1.77 billion, or 82 cents per share, which was higher than analysts expected, thanks in part to strong growth in its services business. The company also boosted its fiscal year 2006 EPS growth estimate to 14%-17%.

Morgan Stanley upgrades Northwest Airlines (NWAC ) to overweight from equal-weight.

Sonic Solutions (SNIC ) posts 15 cents, vs. 16 cents first-quarter earnings per share (GAAP basis) as higher operating costs offset a 98% revenue rise. First Albany raises target, reiterates buy.

B.J.'s Wholesale Club (BJ ) reported that its second-quarter profit rose a higher than expected 9% to $30.5 million, or 44 cents per share. The retailer cut its full-year financial guidance, because gasoline sales have not been as profitable as expected.

After Monday's close, Gateway (GTW ) reported a profit of $17.2 million, up from a loss of $339 million in the period last year. However, the computer maker cut 2005 revenue guidance to $3.9 billion to $4 billion, and sees 11-13 cents 2005 EPS (GAAP basis). Bear Stearns downgraded to underperform.

H.J. Heinz (HNZ ) acquires HP Foods Group from Groupe Danone for $820 million in cash.

J.P. Morgan Chase (JPM ) reached a settlement deal on adversary proceedings brought by Enron in bankruptcy court, whereby it will to pay $350 million and give up certain contested claims. J.P. Morgan does not sees material adverse impact on earnings per share.

Estee Lauder (EL ) posts 30 cents, vs. 31 cents, fourth-quarter earnings per share as special tax charge offset a 10% sales rise. The cosmetics maker sees $1.95-$2.00 fiscal year 2006 EPS.

J.C. Penney (JCP ) posts 50 cents second-quarter earnings per share, vs. 2 cents loss, on 4.2% same-store sales rise and 5.4% total sales rise. The department store sees third-quarter and fourth-quarter same-store, catalog/Internet sales up in the low single-digits, and 82 cents and $1.52 EPS from continuing operations, respectively.

Dick's Sporting Goods (DKS ) posts 41 cents, vs. 34 cents, second-quarter earnings per share on flat same-store sales and 49% total sales rise. It sees 6-8 cents third-quarter EPS on 1%-2% same-store sales rise. The company cuts $1.82-$1.87 fiscal year 2006 EPS guidance to $1.70-$1.75.

American Eagle Outfitters (AEOS ) posts 37 cents, vs. 20 cents, second-quarter EPS on a 21% rise in same-store sales and 30% rise in total sales. The apparel retailer sees 45-46 cents third-quarter EPS.

Staples (SPLS ) posts 20 cents, vs. 16 cents, second-quarter earnings per share on a 12% sales rise. The office supplies retailer sees third-quarter EPS growth in line with average analyst estimates on low double-digit sales growth. It sees fiscal year 2006 revenues growing in the low double-digits.

Delta Air Lines (DAL ) inks a deal to sell its wholly owned regional airline subsidiary Atlantic Southeast Airlines to Skywest (SKYW ) for $425 million in cash.