Movers: Yahoo, Microsoft, Google, Ambac, Exxon Mobil
Microsoft (MSFT) makes a proposal to acquire Yahoo (YHOO) in $44.6 billion deal. Terms: $31 per Yahoo share, with Yahoo shareholders to elect to receive cash or a fixed number of Microsoft shares, with total consideration payable to Yahoo shareholders consisting of one-half cash, one-half Microsoft stock.
Google (GOOG) posts $4.43, vs. $3.91 a year ago, fourth quarter non-GAAP EPS on 51% revenue rise. Investors seem concerned with slower growth in consumer clicks on its ads and higher fees paid to partners, according to the Wall Stree Journal. The company said it expects to continue making "significant" capital expenditures. Separately, there was news that Microsoft announced a bid to acquire Google rival Yahoo.
Ambac Financial Group (ABK) rises after CNBC reports eight large banks have joined forces to seek a rescue plan for Ambac, citing a person familiar with the talks. CNBC said the eight banks are Barclays Plc, BNP Paribas, Citigroup (C), Allianz's Dresdner Bank, Royal Bank of Scotland Group Plc, Societe Generale, UBS AG (UBS), and Wachovia (WB). S&P maintains neutral view on bond insurers; keeps hold ranking on ABK.
Motorola (MOT) says it is exploring the structural and strategic realignment of its businesses to better equip its Mobile Devices business to recapture global market leadership and to enhance shareholder value. Alternatives may include the separation of Mobile Devices from its other businesses in order to permit each business to grow and better serve its customers. Separately, Carl C. Icahn said he is "pleased" that Motorola is exploring a separation of Mobile Devices. S&P keeps hold.
Exxon Mobil (XOM) posts $2.13, vs. $1.76 a year ago, fourth quarter EPS on 30% revenue rise.
Chevron (CVX) posts $2.32, vs. $1.74 a year ago, fourth quarter EPS on 30% revenue rise. Record high oil prices aided results.
Rio Tinto PLC (RTP) jumps 40.35 to 447.30 after Alcoa (AA) announces that it is partnering with Aluminum Corp. of China to acquire 12% stake in RTP. AA will contribute up to $1.2 billion to the total investment. S&P reiterates hold on Rio Tinto, and buy on Alcoa.
Estee Lauder Companies (EL) posts $1.14, vs. $0.99 a year ago, second quarter EPS on 16% revenue rise. It sees $2.28-$2.40 fiscal year 2008 EPS. S&P maintains strong buy.
Weyerhauser (WY) says it will consider a broad range of alternatives for its Commercial Construction Sales business, related assets, ranging from continuing to hold and operate the assets to a possible sale or combination.
Automatic Data Processing (ADP) posts $0.55, vs. $0.54 a year ago, second quarter EPS on 15% revenue rise. Says it remains confident in its ability to achieve high-end of 18%-21% forecasted growth in diluted EPS from continuing operations, up from $1.80 in fiscal year 2007.
Beazer Homes USA (BZH) says it will discontinue mortgage origination services through Beazer Mortgage Corp. effective immediately, ends its related mortgage services relationship with Homebuilders Finl Network LLC. Says it has entered into a new marketing services arrangement with Countrywide Financial ( 2 Next Page