On the Move: Siemens, British Airways, LVMH
From Standard & Poor's European MarketScope
ENDESA was up €0.26 to €21.64. Fortis saw an offer price of €23-€25 and noted that the company's nine months earnings were stronger than expected, adding that the company's estimates for the current and next fiscal years are also good. The broker kept a buy rating for the stock.
COMMERZBANK was down €0.04 to €23.96. Following the Eurohypo deal, several brokers have upgraded and/or raised their price targets. Dresdner KW upgraded it to buy from add and lifted its target to €27.9 from €25.4. CSFB upgraded it to outperform from neutral and raised its target to €27 from €22. UBS, JP Morgan, Ixis and Cheuvreux raised their target prices for the stock.
DAIMLERCHRYSLER (DCX ) was up €0.22 to €43.25. The company's sale of its 12.4% stake in Mitsubishi Motors will help earnings by €501 million in 2005, confirming an earlier estimate. The company said it received proceeds of €970 million from the disposal.
SIEMENS (SI ) was up €0.76 to €64.99. Merrill Lynch downgraded the stock to neutral from buy. The broker mentioned that the share price has moved closer to its fair value of €65 and does not see enough upside to maintain a buy rating. The broker argues that Siemens could be paying more attention to capital allocation. It added that GE (GE ) and the company are much alike in terms of areas of business, yet GE has been better at allocating capital, resulting in a market cap 5 times that of the company, despite the fact that Siemens has 50% more employees.
INFINEON was up €0.05 to €8.00. The company posted a fourth-quarter EBIT loss of €43 million, better than consensus expectations of €78 million.
ERICSSON was up SEK0.40 to SEK27.20. The company's sales are expected to amount to SEK164 billion in 2006, according to SME Direkt's survey of 39 analysts. Separately, the company was chosen by Sun Cellular for push e-mail and Personal Information Management (PIM), called Ericsson Mobile Organizer (EMO).
SWISS RE was up CHF1.15 to CHF94.00. The company is buying GE Insurance Solutions for US$6.8 billion in cash and stock, the company announced in a statement. The company said it would have estimated combined revenues of CHF46 billion (based on 2004 figures) and assets of CHF265 billion (as of June 2005). In connection with the transaction, the company plans to raise up to US$7.5 billion (CHF9.8 billion) in new capital.
NESTLE was up CHF3.25 to CHF399.75. The company is repurchasing CHF3 billion worth of shares with immediate effect.
XSTRATA was up £0.34 to £13.91. Morgan Stanley started coverage with an equalweight rating and a target price of £14.00.
RIO TINTO was up £0.35 to £24.15. UBS increased its target price to £28 from £26, and kept its buy rating.
BRITISH AIRWAYS (BAB ) was down £0.02 to £3.13. UBS raised its target to £3.80 from £3.50, and kept its buy rating.
ELAN (ELN ) was up £0.46 to £9.16. The FDA has accepted a supplemental biologics license application and priority review designation for the company's Tysabri to treat multiple sclerosis.
LVMH was up €0.60 to €71.80. The chairman said he expects strong net earnings growth in the second half, driven by buoyant demand in the U.S. and China and a weaker euro.
BNP-PARIBAS was up €0.75 to €67.35. The company said it will enter the retail market in Russia through its subsidiary Zao. Starting in fiscal year 2006, the company plans to open 150 branches over the next six years in Russia's main cities.
TOTAL (TOT ) was up €1.80 to €215.80. Oil prices slid ahead of the European market opening, with West Texas Intermediate crude oil trading at around $56.3 a barrel. WTI settled at a $56.34 for the third time this week. Meanwhile, the company held an investor day Friday.
Prepared by Zaida Espana, Valerie Vidal, Michael Sanderson, Mariella Mongio, Alexander Wisch, Holly Cook, Emma Stevenson, Pawan Girglani, Julien Manrique, and Rocio Opazo-Aniotz (Standard & Poor's); Alex Halperin (BusinessWeek Online)