Movers: Freddie Mac, Countrywide, Nordstrom, HP, Target
Freddie Mac (FRE) posts $3.29 third quarter loss per share, vs. $1.17 loss a year ago. It notes the loss reflects a higher provision for credit losses and on mark-to-market items, significant deterioration of mortgage credit as a result of continued weakness in the housing market. It says in order to manage to the 30% mandatory target capital surplus and respond to regulatory concerns, it plans to take several actions: it engaged Goldman Sachs and Lehman Brothers as financial advisors; it is seriously considering reducing its fourth quarter dividend by 50%.
Countrywide Financial (CFC) shares fell to a new 52-week low during trading of $8.21 after Fox-Pitt, Kelton analyst Howard Shapiro downgraded the stock to "in line" from "outperform." He wrote that Countrywide's woes could worsen if Freddie Mac is forced to scale back how many loans it buys from mortgage lenders.
Nordstrom (JWN) posts $0.59 third quarter non-GAAP EPS, vs. $0.52 a year ago, on 2.2% higher same-store sales, 5.3% higher total sales. It sees $0.88-$0.92 fourth quarter EPS, $2.87-$2.91 fiscal year 2008 EPS (including items). It sets $1 billion share buyback. S&P cuts estimates, target, but reiterates buy.
Hewlett-Packard (HPQ) posts $0.86 fourth quarter non-GAAP operating EPS, vs. $0.68 a year ago, on 15% higher net revenue. It raised its outlook: it sees $0.80 first quarter non-GAAP EPS on revenue of $27.4-$27.5 billion; $3.32-$3.37 fiscal year 2008 non-GAAP EPS on revenue of $111.5 billion. It says its board authorized an $8 billion additional share buyback program.
Medtronic (MDT) posts better-than-expected $0.58, vs. $0.59 a year ago, second quarter EPS as higher costs and expenses offset 1.6% revenue rise. Notes the voluntary suspension of its Fidelis lead significantly impacted its latest results.
Google (GOOG) heads higher after Credit Suisse raised its target price on the shares of the world's largest Internet company to $900.
Target (TGT) posts $0.56 third quarter EPS, vs. $0.59 a year ago, despite 3.7% same-store sales rise and 9.3% total revenue rise. It says third quarter EPS was disappointing due to soft sales in its higher-margin categories, leading to lower-than-expected gross margin in core retail operations. It sets new $10 billion share buyback, replacing previous authorization.
Barnes & Noble (BKS) posts $0.03 third quarter loss per share, vs. $0.04 loss a year ago, on 5.7% higher total sales. For the fourth quarter and fiscal year 2008, it expects comp-store sales at Barnes & Noble stores to increase in low-single digits, vs. previously expected full-year comp-store sales range of flat to slightly positive.
BJ's Wholesale Club (BJ) posts $0.35 third quarter EPS, vs. $0.28 a year ago, on 3.4% same-store sales rise, 8% total sales rise. It sets preliminary fiscal year 2009 EPS guidance of $1.85-$1.95. It sets additional $250 million share buyback.
H&R Block (HRB) Chairman and Chief Executive Mark A. Ernst resigned effective immediately. Richard C. Breeden, the former Securities and Exchange Commission chairman who led a proxy battle for changes, is now H&R Block chairman and will focus on "external constituencies." Alan M. Bennett, who retired earlier this year as chief financial officer of Aetna Inc., was named interim CEO until the company finds a replacement.
United Natural Foods (UNFI) posts $0.32 first quarter EPS, vs. $0.29 a year ago, on 14% sales rise. It raises fiscal year 2008 net sales guidance to reflect the recent acquisition of Millbrook; now expects net sales to increase to $3.27-$3.35 billion.
GameStop (GME) posts $0.31 third quarter EPS, vs. $0.09 a year ago, on 59% revenue rise. It sees $0.95-$0.97 fourth quarter EPS, which is lower than expected.
Wynn Resorts (WYNN) rises after Jefferies upgrades to buy from hold.
Blue Coat Systems (BCSI) posts $0.17 second quarter EPS, vs. $0.12 loss per share a year ago, on 85% revenue rise. It sees third quarter revenue of $78-$81 million and non-GAAP EPS of $0.31-$0.35.
Dillard's (DDS) posts $0.15 third quarter loss per share, vs. $0.17 EPS a year ago, on 6% lower comp-store sales, 5% lower total sales. It attributes its disappointing operating performance to declines in sales and gross margin rates. The company also announces its board authorized a new share repurchase plan under which DDS may repurchase up to $200 million of its Class A common stock.
D.R. Horton (DHI) posts better-than-expected $0.16 (including pre-tax charges, write-offs) fourth quarter loss per share, vs. $0.88 EPS a year ago, on 35% revenue decline.
SAP AG (SAP) says several senior managers of TomorrowNow, including the company's CEO, have chosen to resign. In addition, SAP says it is considering several options for the future of the TomorrowNow business, including a possible sale.
QLogic (QLGC) says Tony Massetti, senior vice president and chief financial officer, has resigned his position with QLGC effective upon completion of the fiscal third-quarter regularly scheduled earnings announcement in late January 2008.