European Movers: Sainsbury, EADS, UBS
SAINSBURY was down £1.15 to £4.40... Delta Two drops bid; Panmure ups forecasts - Delta Two has terminated takeover talks with the company , saying that it is not in the best interests of stakeholders to proceed with an offer. Delta Two adds required funding and cost of capital had increased significantly, which has adversely affected the investment case. Delta Two has a 25% stake in the company the company in a separate statement confirms the termination of the Delta Two offer. Panmure Gordon says believes that the business is trading well and this should be revealed in the interim results next week. Increases forecasts to above consensus. Rates hold with a £5/sh target. Increases forecasts for 2008 to £501 million from £453 million and for 2009, to £600 million from £512 million.
VODAFONE (VOD) was up £0.03 to £1.88... Lehman ups target to £2.15 from £1.80, keeps overweight. The company reiterates the company as one of its top-picks and increases EPS estimates by up to 10%. the company is the frontrunner to buy a 25% stake in the mobile phone unit of Telekom Malaysia, the Sunday Times reported. The stake may cost as much as US$3 billion.
EADS was down €0.88 to €22.01... Expects further costs for A400M delays - the company reportedly believes it will now need to expense between €1.2 billion and €1.4 billion, with more than €1 billion of this for Airbus.
SOC GEN was down €2.31 to €106.34... Bear Sterns downgrades to Peer Perform from outperform and cuts target to €122. The broker's more cautious assessment of the outlook for Corporate & Investment Banking (2009 revenues estimates cut by 8%) and Investment Management (revenues cut by 5%) has lead Bear Sterns to reduce earnings forecasts at the group level by 4% in 2007, 11% in 2008 and 10% in 2009. The broker has also trimmed long-term growth expectations for the company At the same time, believes investor risk aversion has increased and broker notes that the company is the highest beta stock within the French banks sector.
STM (FR) (STM) was up €0.17 to €11.83... Closes agreement with Nokia in 3G chipsets
COMMERZBANK was down €0.32 to €27.19... Talk of the company to cut guidance - Traders note rumour that the company will cut its guidance. the company will report third quarter on 7 November. A poll compiled by Reuters sees net profit more than doubling to €451 million
MUNICH RE was down €2.40 to €128.23... Tax gain helps lift third quarter net (broker comment) - Supported by a one-off tax gain of €400 million, the company reported higher-than-expected third quarter income before minorities of €1.216 billion on gross premiums written at €9.148 billion, also ahead of a consensus view. Merck Finck notes that the operating result of €1.13 billion is in a touch lower than expected probably because of the investment result of €1.99 billion falling short of forecasts. Subprime exposure gave rise to expenses of around €150 million for the nine months period, or €115 million in third quarter. the company says it can beat its fiscal 2007 forecast as long as the capital markets and claims burden develop normally until the end of the year.
ALTANA was up €0.26 to €16.78... Reports nine months EBITDA of EUR 192.1 million on sales at €1.1 billion. the company expects clear double-digit growth in EBITDA to a level between EUR 235-245 million for the year as a whole.
CASH.LIFE was up €0.59 to €9.15... Flags change in purchasing policy - UniCredit notes that after the profit warning last week, the company released its full third quarter report today. Prelims were confirmed: €218.7 million policy purchases, €117.9 million sales, EBIT of €2.4 million and a net loss of €4.7 million.
the company expects a consolidation period and intends to improve its margin by a more differentiated purchasing policy in the future and more cost control.
FIAT was down €0.74 to €21.65... October car sales disappoint - the company's October new car registrations in Italy increased 7% vs market growth of 8.5%. The performance was worse than expected and takes the company's Italian market share to 30.7% from 31.1% during October 2006. The weaker numbers were the result of a decline in Alfa Romeo and Lancia sales. Sales of the Fiat 500 remained strong.
PHILIPS (PHG) was up €0.56 to €29.52... ABN upgrades on possible fiscal law change in NL - The Dutch ministry of Finance considers to change a fiscal law that will possibly double tax friendly buy backs for Dutch corporations. ABN Amro upgrades the company to buy from hold. Broker has been neutral on the company over the last twelve months, but estimates now that with the changed fiscal law, the company could buy back up to €5.87 billion of its own shares next year. LG. Philips LCD jumped 6.9% in Asia this morning on predictions that the company's earnings would continue to improve.
LOGICACMG (NL) was down €0.06 to €2.19... Cheuvreux downgrades after third quarter update - Following the company's third quarter trading update, Cheuvreux downgrades to underperform from outperform. the company says expects fiscal revenue growth to be around 3% from earlier guidance of around 4-6%. Anticipates second half adjusted operating margin to be slightly below 9% due to charges and recruitment costs. The company says revenue in first nine months rose 3.6% on cer basis and third quarter revenue growth was 4%, led by a particularly strong performance in France. S&P Equity Research says the company's trading update contained more disappointments.
YIT was up €0.28 to €20.39... 50% sales growth in Russia - the company's CEO says it is on track for 50% sales growth in Russia in 2007, according to Reuters.
VESTAS WIND was down DKK5.00 to DKK446.00... Horizon Wind Energy orders 67 turbines - the company wins an order from Horizon Wind Energy to deliver 67 wind turbines by 2008 to a Kansas farm. The agreement includes a five-year service contract.
UBS (UBS) was down CHF2.10 to CHF54.60... Ospel under pressure / Citi write downs - the company may oust chairman Marcel Ospel if subprime-related losses increase, according to Sunday press. Worth noting, Citigroup estimates that its reduction in revenues related to sub-prime related direct exposures ranges from US$8 billion to US$11 billion. The US bank also said CEO Charles Prince will step down. Separately, EBK sees no total subprime writedown - Switzerland's banking watchdog, EBK, reportedly said it is unlikely that the company will need to write down its entire US$39 billion exposure to the US subprime residential mortgage market.
CS GROUP (CS) was down CHF1.20 to CHF71.25... Bear Stearns downgrades to peer perform from outperform. The broker is reducing its 2007 EPS forecast by 4% to CHF8.33. The company says this is due to reassessing investment banking revenues and the impact of lower invested assets in Asset Management. It is also cutting its 2008 EPS forecast by 10% to CHF8.24. Notes this is primarily due to a less positive outlook for investment banking revenues.