4 Stocks That Were On The Move Dec. 19

Includes: EGO, JAKK, MRK, SCHN
by: Alex Shadunsky

These four stocks posted big losses on Monday, following the broader market lower.

JAKKS Pacific (NASDAQ:JAKK) fell 20% after it announced that the sales performance of its products has been disappointing, in what appears to be a difficult retail sales environment for toys, especially during the important holiday season, which has also resulted in higher markdown allowances and higher royalty expenses relating to license guarantee shortfalls. The company currently anticipates net sales for the full year 2011 of approximately $660 million, with diluted earnings per share in the range of $0.37 to $0.40, excluding non-recurring financial and legal advisory charges. This is a reduction from the company's previously anticipated full year 2011 net sales of approximately $770 million to $775 million, with diluted earnings per share in the range of $1.32 to $1.35, excluding such one-time charges.

The company’s guidance with respect to diluted earnings per share is a non-GAAP financial measure, due to the exclusion of such one-time charges. Such one-time charges are anticipated to equal $0.09 per share; accordingly, on a GAAP basis, the company anticipates diluted earnings per share for the full fiscal year ending December 31, 2011 to be in the range of $0.28 to $0.31.

Eldorado Gold (NYSE:EGO) tumbled 14% after it announced that it has entered into a definitive agreement with European Goldfields Limited pursuant to which Eldorado has agreed to acquire all of the issued and outstanding common shares of European Goldfields by way of a plan of under the Yukon Business Corporations Act.

European Goldfields is a precious metals development company with attributable gold reserves of 9.2 million ounces and multi-stage assets located in Greece, Romania and Turkey. The company currently operates the Stratoni mine in Greece and is developing the Skouries and Olympias projects in Greece and the Certej project in Romania. European Goldfields is also partnered with Aktor, the largest construction company in Greece.

Under the Arrangement, shareholders of European Goldfields will receive 0.85 Eldorado shares and C$0.0001 in cash per European Goldfields share. Each outstanding option of European Goldfields shall be exchanged for options of Eldorado that will entitle the holder to receive, upon the exercise thereof, Eldorado shares based upon the Exchange Ratio and otherwise on the same terms and conditions as in the original European Goldfields option. The total transaction value is approximately C$2.5 billion.

Trius Therapeutics (TSRX) tumbled 12% despite announcing that tedizolid phosphate met the primary objective of non-inferiority for the efficacy outcome of early clinical response versus the comparator linezolid (Zyvox) in patients with acute bacterial skin and skin structure infections (ABSSSI). Tedizolid also met all secondary efficacy outcomes in this first of two pivotal Phase 3 trials that were designed to support the filing of a New Drug Application (NDA) with the FDA as well as a Marketing Authorization Application (NYSE:MAA) with the European Medicines Agency (NYSEMKT:EMA).

The pivotal Phase 3 trial, designated TR701-112, examined the efficacy and safety of a once daily 200 milligram dose of oral tedizolid phosphate over a 6-day course of therapy (followed by four days of placebo) versus a twice daily 600 milligram dose of oral linezolid over a 10-day course of therapy in 667 patients recruited across sites in North America, South America and Europe. In the Intent to Treat (NYSE:ITT) analysis set, tedizolid achieved the primary objective of non-inferiority (10% non-inferiority margin) to linezolid in the primary and secondary efficacy endpoints.

Schnitzer (NASDAQ:SCHN) closed 9% lower after it said that it expects first quarter results to be lower than the outlook provided in its fourth quarter fiscal 2011 earnings release due to weaker than anticipated global market conditions for recycled metals. Heightened global recessionary concerns, stemming primarily from the European debt crisis which escalated during the quarter, resulted in a significant slowdown in buying patterns and a sharp decline in sales prices. During the quarter, operating margins contracted more than anticipated. The most significant factor affecting operating margins was the negative impact of average inventory costs which did not keep pace with the rapid decline in average net selling prices. Schnitzer’s fully diluted earnings per share are expected to be in the range of $0.18 - $0.25 for the first quarter of fiscal 2012.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.