Movers: Merrill Lynch, United Rentals, Bear Stearns, HSBC, La-Z-Boy
Merrill Lynch (MER) rises on a WSJ report that that NYSE CEO John Thain has agreed to take the top post at Merrill Lynch, in a move that was somewhat unexpected, as many Wall Street insiders were speculating Merrill Lynch's board would tap BlackRock CEO Larry Fink. S&P maintains hold.
United Rentals (URI) drops after it says Cerberus Capital Management, L.P. informed it that Cerberus is not prepared to proceed with the purchase of URI on the terms set forth in its merger agreement, dated July 22, 2007. Under that agreement, Cerberus agreed to acquire United Rentals for $34.50 per share in cash, in a transaction valued at approximately $7.0 billion.
Bear Stearns Companies (BSC) shares are higher on report COO, CFO Sam Molinaro said the company's leveraged finance business is improving, and the company sees $1.2 billion in the fourth quarter write-downs, reduces its CDO exposure to $884 million from $2 billion. Molinaro is speaking at a banking conference sponsored by Merrill.
HSBC Holdings PLC (HBC) says it recorded loan impairment charge in respect of its U.S. Consumer Finance business was $3.4 billion in the third quarter. Charges were some $1.4 billion higher than would have been implied by extrapolating first half trends. However, the company notes that third quarter profit before tax was ahead of the equivalent quarter in 2006. Notes strong growth from Asia and the Middle East.
Delta Air Lines (DAL) issues press release denying that it is in talks with UAL Corp. (UAUA) to combine. This was in response to an earlier report by the Associated Press that DAL and UAUA were in talks to combine. S&P reiterates hold.
La-Z-Boy (LZB) posts $0.07 second quarter loss from continuing operations, vs. $0.06 EPS a year ago, on 12% sales decline. It says that with the continued weak demand at retail for furniture, the decline in consumer confidence and the overall uncertain economic environment, previous annual guidance will not be attainable. It now sees second half fiscal year 2008 sales decline of 4%-8%, EPS of $0.06-$0.14.
McCormick & Co. (MKC) signs agreement with Unilever to buy the assets of Lawry's for $605 million in cash. S&P maintains hold.
Leggett & Platt (LEG) says it will eliminate or divest a number of its less profitable businesses and close some underperforming plants. Raises its quarterly dividend by 39% to $0.25 per share. Also says a 10 million share buyback authorized for 2008 will be moved forward to Nov. 15, 2007. S&P upgrades to hold from sell.
TravelCenters of America (TA) falls after Morgan Keegan downgrades to market perform from outperform. UBS Financial downgrades to neutral from buy. Yesterday TA posted $0.77 third quarter loss, excluding employee severance charge of $0.79.
Macy's (M) posts $0.08 (including $0.02 merger related expense), vs. $0.03 a year ago, third quarter EPS on 0.3% same-store sales rise, 0.8% lower total sales. It notes sales were within the company's guidance. It expects fourth quarter same-store sales to be in range of down 2% to up 1%, November same-store sale are expected to be significantly higher, with December expected to be below last year.
MetroPCS Communications (PCS) posts $0.15, vs. $0.08 a year ago, third quarter EPS on 41% revenue rise. It expects 2008 consolidated adjusted EBITDA to be $750-$850 million, which including adjusted EBITDA loss of $125-$175 million in the AWS Markets.
Vodafone Group PLC (VOD) posts 7% higher first quarter fiscal year 2008 EPS on 9% revenue rise. It lifts fiscal year 2008 outlook. S&P raises target but keeps sell.
Canadian Solar (CSIQ) posts $0.02, vs. $0.01 a year ago, third quarter GAAP EPS on sharp sales rise. It raises 2007 net revenue guidance to $285-$295 million from previous guidance of $255-$265 million. It expects 2008 net revenue of $650-$750 million.
Daktronincs (DAKT) posts $0.19, vs. $0.22 a year ago, second quarter EPS as higher costs offset 6% sales rise. It sees $0.10-$0.15 third quarter EPS on $107-$116 million revenue.
CDC Software, a unit of CDC Corp. (CHINA), expects third quarter total revenues of $87-$88 million, an increase of over 40% from $61.4 million in third quarter 2006. Software license revenues are expected to be between $14-$14.5 million, an increase of about 18%-22% from $11.9 million in the third quarter of 2006.
Idex Corp. (IEX) agrees to acquire Nova Technologies Corp. for about $158 million.
BEA Systems (BEAS) intends to file on Nov. 15, 2007 all delinquent periodic reports necessary for BEAS to regain compliance with its NASDAQ filing requirements. The Company received a letter from the Board of Directors of The NASDAQ Stock Market LLC granting BEA an extension until Jan. 9, 2008 to file.
Verisign (VRSN) - the WSJ reports that the company is set to announce that it will divest itself of as many as 10 of 15 business units as part of a corporate overhaul.
Shaw Group (SGR) says it will delay filing of its fiscal year 2007 Annual Report until after Nov. 14, 2007, expiration of the extension period. Says adjustments to net earnings for fiscal years 2005 and 2006 consist of charges approximating $500,000-$800,000 respectively.
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