Outback Shares Dip on Weak Earnings

BlackRock to merge with Merrill unit; RealNetworks posts results; plus more stocks in the news Wednesday

Shares of Outback Steakhouse (OSI) declined Wednesday after the restaurant operator posted 46 cents (excluding one-time items) vs. 50 cents fourth quarter EPS. The company reportedly sees $1.65-$1.75 2006 EPS, including items. S&P cuts estimate, target, keeps hold.

BlackRock (BLK) and Merrill Lynch (MER) inked a deal to merge Merrill's investment management business and BlackRock. Merrill will have a 49.8% stake and 45% voting interest. As a result of the merger, The PNC Financial Services Group (PNC), which owns 70% of BlackRock, will hold a 34% share in the combined company.

Blue Coat Systems (BCSI) shares dipped Wednesday after the company posted lower-than-expected 21 cents vs. 12 cents third quarter EPS (non-GAAP) on a 44% revenue rise. It says two orders didn't close during the third quarter. It also sees 5 cents to 11 cents fourth quarter EPS on revenue of $34.5 million to $35.5 million.

ONEOK (OKE) is to sell assets to Northern Border Partners (NBP) for $3 billion. The natural gas companies have agreed that ONEOK will buy TransCanada's (TRP) 17.5% general partner interest in Northern Border Partners for $40 million, raising ONEOK's ownership of interest to 100%. Northern Border Partners is to sell 20% of its pipeline to TransCanada's unit.

RealNetworks (RNWK) The digital media company posts $1.61 fourth quarter earnings per share (EPS) vs. a one penny loss on a 15% revenue rise. It will take a benefit of $434.4 million related to Microsoft (MSFT) agreements. It sees 11 cents to 13 cents first quarter EPS on revenue of $82 million to $86 million, and 75 cents to 80 cents 2006 EPS on revenue of $365 million to $380 million.

The Securities and Exchange Commission may commence civil enforcement action against Guess (GES) president and Chief Operating Officer Carlos Alberini, in connection with his service at his previous employer Footstar.

Cephalon (CEPH) posts 72 cents vs. 82 cents fourth quarter EPS (adjusted) despite a 13% revenue rise. It sees 2006 sales of $1.55 billion to $1.6 billion, $200 million above its previously issued guidance. It also sets basic adjusted 2006 EPS guidance of $3.80 to $4.00.

Chicago Bridge & Iron Company (CBI) Due primarily to adjustments stemming from issues related to unapproved change orders and claims on several projects, the engineering and construction company sees 40 cents to 50 cents 2005 EPS, including 7 cents attributable to other operating income.

Eastman Kodak (EK) shares were seen higher after reports that the investment firm Legg Mason (LM) increased its stake in Kodak to 24.89%.

E*TRADE Financial (ET) says total retail assets and deposits in customer accounts for January increased 5.6% sequentially to about $188.4 billion. It posts a 33% sequential increase in January DARTS.

Merck (MRK) the Food and Drug Administration accepts the company's New Drug Application for Januvia, an investigational medicine for the treatment of type 2 diabetes, for standard review. Merck expects FDA action on the NDA by mid-October.

W.R. Grace (GRA) Shares in companies with significant asbestos-related liabilities were seen lower in premarket trading, after a bill to take injury claims out of court and pay them from national compensation fund was derailed in the US Senate.

Ingram Micro (IM) posts 51 cents vs. 48 cents fourth quarter EPS (GAAP) on a 6.7% sales rise. It sees 32 cents to 35 cents first quarter EPS.

Shanda Interactive Entertainment Limited (SNDA) In a SEC filing, Cisco Systems (CSCO) reports it has purchased a 9.7% stake in Shanda.

Jones Apparel Group (JNY) posts 48 cents vs. 28 cents fourth quarter EPS on a 13% total revenue rise. It sees $4.65 billion to $4.75 billion 2006 revenue, and targets 2006 adjusted EPS to be equal to or exceed adjusted EPS of $2.48, excluding items.

Abercrombie & Fitch (ANF) posts $1.80 vs. $1.15 fourth quarter EPS on 28% higher total company same-store sales, and 40% higher total sales. It sees $1.23 to $1.28 first half fiscal year 2007 EPS, including stock compensation expense.

LA-Z Boy (LZB) posts 20 cents vs. 20 cents third quarter EPS from continuing operations on 3.5% lower same-store sales and flat total sales. It sees 26 cents to 32 cents fourth quarter EPS on "essentially" flat sales.

Itron (ITRI) posts 59 cents vs. 40 cents fourth quarter EPS (pro forma) on a 22% revenue rise. It sees $2.07 to $2.13 2006 EPS (pro forma) on revenue of $605 million to $615 million.

Davita (DVA) posts 54 cents vs. 51 cents fourth quarter earnings per share (EPS) from continuing operations on a sharp revenue rise. It sees $630 million to $700 million 2006 operating income (including FASB No. 123R), vs. previous $600 million to $670 million guidance.

Inter-Tel (INTL) posts 33 cents vs. 12 cents (restated) fourth quarter GAAP EPS on flat sales. It is to restate revenues and a related income tax provision for all periods to be presented in its 10-K in March.

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