Movers: Ambac, Delta, Yahoo, Big Lots, Smithfield Foods, Maidenform
Ambac Financial Group (ABK) shares drop after being halted on news that the company will try to sell $1 billion in common stock and $500 million worth of equity units -- notes that must be converted to common stock in May 2011. Ambac's is trying to raise $1.5 billion in fresh capital to defend the key AAA rating at subsidiary Ambac Assurance. This morning, CNBC's Charles Gasparino reported that a consortium of banks looking to bail out ABK were working to finish the deal today.
Delta Air Lines (DAL) rises 1.19 to 14.33 after AP reports that pilot union leaders at Delta and Northwest Airlines (NWA) were meeting Wednesday in Washington, a hopeful sign that formal negotiations over integrating seniority lists to facilitate a combination of the two carriers could soon resume.
Yahoo (YHOO) extends deadline for nominating directors to its board from Mar. 14 to 10 days following the public announcement of the date for Yahoo's 2008 annual meeting of stockholders. Separately, WSJ reports Yahoo and Time Warner (TWX) have stepped up talks to create an alternative to Microsoft's (MSFT) offer to take over Yahoo. The article says talks center on a deal that would fold Time Warner's AOL Internet unit into Yahoo, and sources still consider a Yahoo purchase by Microsoft as the most likely outcome. S&P Equity Research reiterates hold rankings on both Time Warner and Yahoo.
Smithfield Foods (SFD) agrees to sell Smithfield Beef Group, Inc., its beef processing and cattle feeding operation, to JBS S.A. for $565 million in cash. The deal excludes substantially all live cattle inventories held by Smithfield Beef and Five Rivers as of the closing date, together with associated debt. Live cattle currently owned by Five Rivers will be transferred to a new 50/50 joint venture between Smithfield Foods and CGC, while live cattle currently owned by Smithfield Beef will be transferred to another subsidiary of Smithfield Foods.
Big Lots (BIG) posts fourth quarter EPS from continuing operations of $0.97, vs. $0.83 a year ago, despite 0.6% same-store sales drop. It notes fourth quarter fiscal year 2008 contained one extra week. It sees $0.30-$0.35 first quarter EPS from continuing operations, $1.70-$1.80 fiscal year 2009 EPS from continuing operations on 1%-2% same-store sales rise.
BJ'S Wholesale Club (BJ) posts $0.80, vs. $0.18 (including items) a year ago, fourth quarter EPS on 5.4% higher same-store sales (incl. gas and pharmacy), 1.9% higher total sales. Separately, the company reported a 5.9% gain in same-store sales for February.
Costco Wholesale (COST) reports second quarter EPS of 74 cents, vs. 54 cents a year earlier. Revenue increased 12% to $17 billion as same-store sales rose 7%.
Maidenform Brands (MFB) posts $0.27, vs. $0.13 a year ago, fourth quarter EPS on 13% sales rise. Continues to remain cautious based on macro-economic conditions that exist affecting current retail climate. As such, maintains 2008 sales growth guidance of 4%-7% and EPS growth of 10%-15%.
Trump Entertainment Resorts (TRMP) posts $5.89 fourth quarter GAAP loss per share, vs. $0.31 loss a year ago, on 6.4% lower revenue, asset impairment charges. S&P maintains hold.
Fuel-Tech (FTEK) posts $0.21, vs. $0.06 a year ago, fourth quarter EPS on 80% revenue rise. Expects 2008 revenue to increase by 10%-16%, to $88-$93 million.
The company reportedly forecast $0.33-$0.39 2008 EPS. The company's 2008 EPS and revenue outlook are seen below estimates.
Citigroup downgrades specialty finance REIT group; it downgrades iStar Financial (SFI), Gramercy Capital (GKK), CapitalSource (CSE), KKR Financial Holdings (KFN) and NewStar Financial (NEWS) to hold from buy; downgrades Arbor Realty Trust (ABR), Newcastle Investment (NCT), CBRE Realty Finance (CBF) and Resource Capital (RSO) to sell from hold.
Heelys (HLYS) shares fell to a new 52-week low of 4.21 after the company posts $0.20 fourth quarter loss per share, vs. $0.44 EPS a year ago, on 86% sales decline. Included in this year's fourth quarter results is a charge of about $1.5 million related to the write-down of certain inventory on the company's balance sheet and the aforementioned increases related to the MDF assistance and reserve for returns.
Packeteer (PKTR) rises on news that Elliott Associates, L.P. (together with funds under common management), which collectively own 9.8% of company, offers to acquire Packeteer for $5.50 per share.
Omniture (OMTR) announces that Adobe Systems (ADBE) and Baidu.com (BIDU) have joined the Omniture Genesis Network, which has now reached 130 partners, and that OMTR and BIDU have entered a strategic alliance. Separately, the company announces release of SiteCatalyst 14, a new version of its Web analytics solution.
Pfizer (PFE) reaffirms $1.78-$1.93 2008 EPS (reported) guidance range, $2.35-$2.45 adjusted EPS, on revenue in the range of $47-$49 billion. PFE says it expects: Phase III pipeline to grow to 24-28 programs by end of 2009; seize growth opportunities in emerging markets; establish a new business unit focused on oncology.
Rehabcare Group (RHB) posts $0.29, vs. $0.12 a year ago, fourth quarter EPS as lower costs and expenses offset 4.7% lower operating revenues. Sees strong consolidated net earnings growth in full-year 2008, but expects quarterly operating earnings to be uneven, with all quarters impacted by hospital start-up/ramp-up costs.
Brown Shoe (BWS) posts $0.33, vs. $0.31 a year ago, fourth quarter EPS despite 11% sales drop. Notes fourth quarter fiscal year 2007 included an extra week. It sees first quarter same-store sales down 3%-5%, flat to down 2% for fiscal year 2009. Sees $0.07-$0.11 first quarter EPS, $1.52-$1.62 fiscal year 2009 EPS.
US Airways Group (LCC) posts 2.9% rise in revenue passenger miles for the month of February, capacity was up 2.2%, passenger load factor rose 0.5 points.
Saks (SKS) posts $0.26 fourth quarter EPS (including $0.07 gain), vs. $0.14 a year ago, on 9% higher same-store sales. Expects same-store sales growth of mid-single digits for fiscal year 2009, with assumption of low-to-mid single digit same-store sales growth in the first half of the year and mid-single digit same-store sales growth in the second half. Posts 3.4% higher February same-store sales.
Chico's FAS (CHS) posts $0.12 fourth quarter loss per share, vs. $0.10 EPS a year ago, on 16% lower same-store sales, 7.9% total sales drop. Posts 15% lower February same-store sales, 6.7% lower total sales for company-owned stores. Sees negative first half fiscal year 2009 same-store sales, lower EPS vs. first half of fiscal year 2008. Sees return to positive same-store sales in second half of fiscal year 2009.
Canadian Solar (CSIQ) posts $0.20 fourth quarter preliminary GAAP EPS, vs. $0.21 loss per share a year ago, on sharply higher revenue. Sees $150-$155 million net revenue in the first quarter and $650-$750 million for 2008.
Kenneth Cole Productions (KCP) posts in-line $0.17 (excluding $0.33 charge), vs. $0.39 a year ago, fourth quarter EPS on 2.1% revenue decline. Sees $0.03-$0.05 first quarter EPS on revenue of $120-$125 million, compared to fourth quarter revenue of $132.1 million. It sets additional 4 million share buyback program. Given reduced cash flow expected during 2008, it projects use of cash reserves for stock repurchase, cuts $0.18 quarterly dividend to $0.09.