Altria Group Resolves Audit With IRS

Kraft is to sell its Milk-Bone brand to Del Monte; Bear Stearns net jumps; Faro Technologies investigates foreign sales in China; plus more stocks in the news Thursday

Shares of Conagra Foods (CAG) declined Thursday after the company said it expects to take charges during the remainder of fiscal year 2006, as well as future quarters for planned divestitures and restructuring. It sees $1.10 to $1.15 fiscal year 2007 EPS, excluding items that impact comparability, and sees a return to current EPS levels in fiscal year 2009.

Bear Stearns (BSC) posts $3.54 vs. $2.64 first quarter earnings per share (EPS) on 19% higher net revenue.

Kraft Foods (KFT) Due to Altria Group (MO)'s audit resolution with the IRS, Kraft is in a deal to sell its Milk-Bone pet snacks brand to Del Monte Foods (DLM). Altria owns Kraft, which raises its 2006 earnings per share (EPS) guidance 17 cents (plus 24 cents for audit resolution, and minus 7 cents for divestiture) to $1.55 to $1.60, including 50 cents in charges.

Steel Dynamics (STLD) says General Motors (GM) has withdrawn its appeal of a Michigan trial court's Aug. 2004 dismissal, with prejudice, of GM's March 2004 breach of contract lawsuit against Steel Dynamics.

Faro Technologies (FARO) says it is conducting an internal investigation into suspicious payments related to foreign sales activities in China. It has notified the Securities and Exchange Commission and the Department of Justice of this matter. It will delay filing its 10-K for 2005.

Barnes & Noble (BKS) posts $1.76 vs. $1.56 fourth quarter EPS on a 3.3% same-store sales (SSS) rise and 5% total sales rise. It expects SSS to increase in the low single-digits for the first quarter 2006. It also sees 10 cents to 14 cents first quarter EPS and $2.20 to $2.30 in 2006 (including expenses).

Cost Plus (CPWM) posts 97 cents vs. $1.06 fourth quarter EPS on a 2.1% same-store sales drop and 7% total sales rise. It sees 8 cents to 16 cents first quarter loss and 86 cents to $1.03 fiscal year 2007 EPS.

Murphy Oil (MUR) cuts its first quarter 2006 production guidance to about 110,000 bbls of oil equivalent per day. It cites equipment issues, the recent unscheduled shutdown at Terra Nova field in offshore eastern Canada, and an extended turnaround expected in the third quarter.

Sovereign Bancorp (SOV) raises its quarterly dividend 33% to 8 cents per share. It also announces a 5% stock dividend, which will be distributed on May 22 to shareholders of record on May 1.

W&T Offshore (WTI) posts 77 cents vs. 59 cents fourth quarter EPS on a 10% revenue rise. It says the apparent high bidder on four Outer Continental Shelf blocks in the Central Gulf of Mexico Lease Sale held on Wednesday.

Novelis (NVL) announces additional restructuring actions of European operations: the sale of an aluminum rolling mill in Annecy, France to American Industrial Acq. Corp. and the reorganization of plants in Ohle, Ludenscheid, Germany, including the closure of two non-core business lines.

Corus Group (CGA) posts GBP 1.51p vs. GBP 3.85p on a 3% revenue drop. Aleris signs a letter of intent to purchase Corus Group's aluminum rolled products and extrusions businesses for EUR 826M.

Hot Topic (HOTT) posts 23 cents vs. 38 cents fourth quarter EPS on 3.8% lower same-store sales and 9.1% higher total sales.

Gymboree (GYMB) posts 60 cents vs. 18 cents fourth quarter EPS from continuing operations on 14% higher same-store sales and 17% higher total sales. It sees 28 cents to 30 cents first quarter EPS from continuing operations and $1.16 to $1.20 in fiscal year 2007.

Ford Motor (F) JP Morgan reportedly downgrades to underweight from overweight.

Winnebago Industries (WGO) posts 23 cents vs. 37 cents second quarter EPS on a 14% revenue drop. It notes the negative impact from lower motor home deliveries due to decreased industry retail demand, and a shift towards lower priced motor home products.

Ormat Technologies (ORA) delays its 10-K filing for the year ended Dec. 31 2005. It says the delay is a result of the need to file separate financial statements of a subsidiary that is not consolidated.

CRA (CRAI) posts 47 cents vs. 43 cents first quarter EPS on a 17% revenue rise. It sees 18% to 20% fiscal year 2006 revenue growth and $2.18 to $2.27 EPS (including 29 cents to 30 cents impact from stock-based compensation).

Encore Capital Group (ECPG) posts lower-than-expected 32 cents vs. 24 cents fourth quarter EPS on a 27% revenue rise. It notes near term earnings growth will be affected by its ability to identify opportunities to acquire attractively priced portfolios.