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  • Citi to raise a paltry $3B. Citigroup (NYSE:C) announced a $3B secondary offering yesterday after the close, sending its shares down 2.8%. Citi arch-nemesis, Oppenheimer analyst Meredith Whitney was unimpressed: She says Citi still needs to raise another $10-15B to fully bolster its books. "The fact that the company raised such a small amount of capital at this time confounds us," she wrote. Sources say the Government of Singapore Investment Corp. may buy a stake in the $3B offering; it already owns 4% of the company. Yesterday's news brings Citi's total fundraising efforts to $36B since its troubles began last year.
  • Content, content, content. Time Warner (NYSE:TWX) announced a divestment of its 84% stake in Time Warner Cable (NYSE:TWC). CEO Jeffrey Bewkes is eager to transform TWX into a pure media-content provider. He is expected to increase TWX's debt levels, and release as much as $5B from the proceeds to shareholders; that would leave another $4.2B for TWX. Time Warner posted Q1 EPS of $0.22, a penny short of consensus, on in-line revenue of $11.42B (+2%). Earnings at its AOL unit dived 74% as revenue dropped 23%. Ad revenue growth was just 1%. TWC EPS of $0.25 beat the consensus of $0.22. Revenue of $4.2B was in line. Voice revenue jumped 39% and broadband sales were up 11%. TWC added about 900K subscribers to 33M.
  • SAP slides on shortfall. SAP (NYSE:SAP) announced Q1 EPS of €0.29 on revenue €2.5B. Net income fell 22% to €242M, missing consensus estimates of €296M. SAP boosted its full-year operating margin forecast to 28.5-29% from 27.5-28%. It still expects a 12-14% increase in software-related service revenue this year. Shares are down 5.9% in early pre-market trading.
  • Unanticipated middle path for Microsoft. Microsoft (NASDAQ:MSFT) is considering backing off from its $42B bid for Yahoo (NASDAQ:YHOO), launching a proxy fight to take over its board, and leaving itself the option of later going directly to Yahoo shareholders with a hostile offer. The move represents a "middle path" between walking away and going hostile. It may make the move as early as today, WSJ says. Court papers reveal Microsoft has considered setting aside $1.5B toward bonus packages aimed at retaining Yahoo staffers.
  • "Make that two 3G iPhones." AT&T (NYSE:T) plans to subsidize the much-anticipated 3G iPhone (NASDAQ:AAPL) by as much as $200 -- cutting its price tag to just $199 in exchange for a two-year contract -- when it's released this summer. A $200 iPhone could pose a serious threat to rivals Verizon Wireless (NYSE:VZ), Sprint (NYSE:S) and T-Mobile (DT). Bargain hunters will have to buy their phones straight from AT&T, which should ensure the subsidized phones aren't being bought by customers who plan to crack them and use them on a different network. Sources say the new iPhone will be 2.5 mm thinner than the current 11.7 mm model. Some think the price drop may be a precursor to a rise in the $20/month data charge, which is far cheaper than AT&T charges for the BlackBerry ($45).
  • Alcatel-Lucent: Still waiting for recovery. Alcatel-Lucent (NYSE:ALU) said it lost €0.04 in Q1. Adjusted net income of €36M beat consensus estimates of -€46M, but sales of €3.86B were short of the €3.99B analysts expected. ALU said it expects revenue to fall 2-5% in 2008 due to the negative effects of a strong euro and tighter IT spending, sending shares down 7.5% in Paris this morning. It also said it thinks global telecom equipment sales to be flat this year, vs. a previous forecast of "slightly up." Rival Ericsson (NASDAQ:ERIC) posted strong results last week and left its full-year forecast intact.
  • IBM shareholders get 25% raise. IBM (NYSE:IBM) boosted its quarterly dividend by 25% to to $0.50/share, reflecting its apparent confidence to thrive despite a U.S. economic slowdown.
  • Petrobras confident over find. oil field has huge potential. Petrobras (NYSE:PBR) CEO Sergio Gabrielli says the potential of the newly found Carioca oil field, located off the Brazilian coast, could be huge, and that he doesn't foresee insurmountable difficulties associated with the drilling.
  • No rate hike in Japan. Japan left its main interest rate unchanged at 0.5%, and cut its 2008 growth forecast to 1.5%. Governor Masaaki Shirakawa gave up his long-standing bias toward more rate hikes, warning downside risks were likely to dominate over the next year. "If we look at the prospects for 2008/09, we are putting more emphasis on downside risks than on upside risks." For the first time in two years, the bank's release dropped its goal of gradually adjusting low interest rates to more normal levels.

Earnings: Tuesday After Close

  • Conexant (NASDAQ:CNXT-RETIRED): FQ2 EPS of -$0.29 misses consensus of -$0.02.Revenue of $145M vs. consensus of $168M.
  • Denny's (NASDAQ:DENN): EPS of $0.05 beats consensus of $0.04. Revenue of $196M vs. consensus of $190M. Same-store sales increased 0.7% at company units and decreased 0.9% at franchises.
  • Dreamworks Animation (NASDAQ:DWA): Q1 EPS of $0.28 beats consensus of $0.23. Revenue of $158M vs. consensus of $132M.
  • Express Scripts (NASDAQ:ESRX): Q1 EPS of $0.70 beats consensus of $0.67. Revenue of $4.60B vs. consensus of $4.78B. Sees 2008 EPS of $2.95-3.03 vs. consensus of $2.98.
  • Edgar Online (NASDAQ:EDGR): EPS of -$0.03 in line. Revenue of $4.99M vs. consensus of $4.74M.
  • Flextronics (NASDAQ:FLEX): FQ4 EPS of $0.26 beats consensus of $0.23. Revenue of $7.8B in line. Sees Q1 EPS of $0.27-0.29 vs. consensus of $0.27, and revenue of $8B-8.5B vs. consensus of $8.33B.
  • Panera Bread (NASDAQ:PNRA): Q1 EPS of $0.41 beats consensus of $0.39. Revenue of $305M vs. consensus of $303M. Raises Q2 EPS guidance to $0.40-0.44 from $0.37-$0.43; consensus is $0.39. Drops its second-half EPS target to $1.17-1.28 from $1.22-$1.32.
  • True Religion (NASDAQ:TRLG): FQ4 EPS of $0.40 beats consensus of $0.39. Revenue of $52.7M vs. consensus of $52.32M.

Earnings: Wednesday Pre-Market

  • Cache (NASDAQ:CACH): Q1 EPS of $0.01 beats consensus of $0.00. Revenue of $67.7M in line.
  • Colgate Palmolive (NYSE:CL): Q1 EPS of $0.90 just beats consensus of $0.89. Revenue of $3.7B vs. consensus of $3.57B.
  • Dean Foods (NYSE:DF): Q1 EPS of $0.21 beats consensus of $0.18. Revenue of $3.1B in-line. Sees Q2 EPS of $0.26-0.$0.31, in-line with consensus of $0.28. Sees 2008 EPS of at least $1.20, lower than consensus of $1.27.
  • Garmin (NASDAQ:GRMN): Q1 EPS of $0.67 misses consensus of $0.75. Revenue of $664M vs. consensus of $713M. Shares are down 7.4% in the pre-market.
  • General Motors (NYSE:GM): Q1 EPS of -$0.62 misses consensus of -$1.54. Revenue of $42.7B vs. consensus of $40.78B.
  • Kraft Foods (KFT): Q1 EPS of $0.44 beats consensus of $0.40. Revenue of $10.4B vs. consensus of $9.77B. Sees 2008 EPS of at least $1.90 vs. consensus of $1.89.
  • Jones Apparel (NYSE:JNY): Q1 EPS of $0.37 just misses consensus of $0.38. Revenue of $975M vs. consensus of $936.93M. Sees 2008 EPS of $1.20-1.35, better than consensus of $1.23.
  • Kellogg (NYSE:K): Q1 EPS of $0.81 beats consensus of $0.76. Revenue of $3.25B vs consensus $3.18B. Sees full-year EPS of $2.92-2.97, short of consensus of $2.99.
  • Hess Corp (NYSE:HES): Q1 EPS of $2.34 beats consensus of $2.01. Revenue of $10.72B vs. consensus of $10.55B.
  • InterActiveCorp (NASDAQ:IACI): Q1 EPS of $0.30 in-line. Revenue of $1.60B vs. consensus of $1.53B.
  • Ingersoll Rand (NYSE:IR): Q1 EPS of $0.77 beats consensus of $0.73. Revenue of $2.16B vs. consensus of $2.10B. Sees Q2 EPS of $0.85-0.90, short of consensus of $0.91. Sees full-year EPS of $3.80-3.90, better than consensus of $3.72.
  • International Paper (NYSE:IP): Q1 EPS of $0.41 misses consensus of $0.51. Revenue of $5.7B vs. consensus $5.65B.
  • Office Max (NYSE:OMX): Q1 EPS of $0.68 was in-line. Revenue of $2.3B vs. consensus of $2.34B.
  • Procter & Gamble (NYSE:PG): Q1 EPS of $0.82 just beats consensus of $0.81. Revenue of $20.5B in line.
  • Reynolds American (NYSE:RAI): Q1 EPS of $1.00 misses consensus of $1.15. Revenue of $2.005B vs. consensus of $2.15B.
  • Sanofi-aventis (NYSE:SNY): Q1 operating profit fell 7.2% to €2.52B, and net sales fell 3.3% to €6.94B. Analysts were expecting sales of €6.88B and operating profit of €2.42B. SNY reiterated its 2008 earnings growth forecast of about 7%.
  • Siemens (SI): FQ2 net profit fell 67% to €412M on revenue of €18.09B (unchanged). Consensus was for €351M on revenue of €19.31B. Siemens lowered its full-year earnings guidance, but said it sees no further risks following a March profit warning.

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