Connetics Plunges on Lowered Guidance

Centro to buy Heritage; Kraft to buy United Biscuits units; Bristol-Myers Squibb, Gilead combine AIDS drugs; plus more stocks in the news Monday

From Standard & Poor's Equity Research

Connetics (CNCT) shares dropped sharply Monday after the company said it sees second quarter and full-year 2006 revenues and EPS below guidance, due, in part, to its decision to reduce wholesaler inventory by shipping product volumes below estimated prescription demand, and lower product orders from its international distributor.

Interdigital Communications (IDCC) shares fell after Piper Jaffray downgraded its opinion on the stock to underperform from market perform.

Heritage Property Investment Trust (HTG) agrees to be acquired by affiliates of the Melbourne, Australia-based Centro Properties Group for $36.15 per share cash, or total value of about $3.2 billion, which includes debt assumption.

Kraft Foods (KFT) is to acquire the Spanish & Portuguese operations of United Biscuits for $1.07 billion. The deal also returns to Kraft the rights to all Nabisco trademarks, including Oreo and Ritz, in the European Union, Eastern Europe, Middle East and Africa.

Bristol-Myers Squibb (BMY) and Gilead Sciences (GILD) have combined three AIDS drugs into one pill that the Food and Drug Administration may soon approve, according to the Wall Street Journal.

Kronos (KRON) sees third quarter revenue of $140.0 million to $141.5 million, and EPS of 30 cents to 33 cents (including charges) vs. 39 cents EPS last year. Kronos says its third quarter financial performance did not meet its guidance. JP Morgan trims estimates, but keeps its overweight recommendation.

Walt Disney (DIS) "Pirates of the Caribbean: Dead Man's Chest" set a new record for the highest opening in box office history, selling an estimated $132 million worth of tickets in its 1st three days of release across North America.

WPS Resources (WPS) is to acquire Peoples Energy (PGL) at 0.825 WPS share for each Peoples Energy share.

Dominion Homes (DHOM) says that during the second quarter it sold 356 homes, with sales value of $66.2 million vs. the second quarter 2005's sales of 655 homes for $123.1 million. It cites difficult home sales conditions in its markets.

MetLife (MET) says Citigroup has sold to an unaffiliated broker-dealer all of the 22.4 million MetLife shares that Citigroup (C) had received in the 7/1/05 sale of Travelers Life & Annuity.

Chattem (CHTT) posts 52 cents vs. 76 cents second quarter earnings per share (EPS) despite a 4.9% revenue rise. It cut its fiscal year 2006 revenue estimate to $295 million-$310 million from $315 million-$330 million, and its earnings per share (EPS) estimate to $1.90-$2.20 from $2.30-$2.40.

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