ERIC - News and Analysis from Seeking Alpha 'ERIC' Tag RSS Syndication from SeekingAlpha.com SeekingAlpha.com http://seekingalpha.com/symbol/eric Airvana: An Opportunity in Femtocells http://seekingalpha.com/article/179616-airvana-an-opportunity-in-femtocells?source=feed 179616 Back in October, I wrote the following:

I’ve got an iPhone. In fact, my wife and two of my three kids have iPhones. The iPhone is absolutely wonderful as a portable computer, camera, music player and casual gaming device. I use it to check on stocks, keep notes, view maps, find where I am, figure currency conversions, send instant messages, play Scrabble and more. But the iPhone is a disappointment as a phone . . . and the problem is getting worse, because every new iPhone user (Apple (AAPL) sells roughly 80,000 iPhones a day) puts greater demands on AT&T’s (T) network.

]]> Wed, 23 Dec 2009 12:37:21 -0500 Timothy Lutts Timothy Lutts submits:

Back in October, I wrote the following:

I’ve got an iPhone. In fact, my wife and two of my three kids have iPhones. The iPhone is absolutely wonderful as a portable computer, camera, music player and casual gaming device. I use it to check on stocks, keep notes, view maps, find where I am, figure currency conversions, send instant messages, play Scrabble and more. But the iPhone is a disappointment as a phone . . . and the problem is getting worse, because every new iPhone user (Apple (AAPL) sells roughly 80,000 iPhones a day) puts greater demands on AT&T’s (T) network.


Complete Story »]]> T VZ S CSCO RIMM NOK ALU MOT HIT NT ERIC AIRV Timothy Lutts Report from Europe: Markets Quiet After Non Farms Action http://seekingalpha.com/article/176912-report-from-europe-markets-quiet-after-non-farms-action?source=feed 176912

Well, the market at first glance couldn’t find too much to complain about in Friday’s US payrolls report. Just 11k job losses – and this after 159k of upward revisions to the prior two months – beat the most optimistic prediction of the 82 forecasters surveyed by Bloomberg, thus restoring an improving trend. And, whilst the breadth of improvement is perhaps not as solid as I would like at this stage, there were plenty of other positives to be taken.

After three months of very large losses, the household survey reported a 227k jobs gain, dropping the unemployment rate back to 10.0%. And a 0.2 hour rise in the average workweek (each 0.1 hour being equivalent to a 350k jobs gain in terms of labor input applied and incomes) means that hours worked rose 0.6% MoM. Most important of all, temporary help rose 52k after an upwardly revised 44k last month (making the fourth consecutive gain). This points to a return to positive payrolls growth before long. Indeed, forecasters are already pencilling in a 50k gain for this month, a forecast that will gain credence if the weekly jobless claims data maintain their recent rate of improvement.

]]> Mon, 07 Dec 2009 11:48:03 -0500 The Mole The Mole submits:

Well, the market at first glance couldn’t find too much to complain about in Friday’s US payrolls report. Just 11k job losses – and this after 159k of upward revisions to the prior two months – beat the most optimistic prediction of the 82 forecasters surveyed by Bloomberg, thus restoring an improving trend. And, whilst the breadth of improvement is perhaps not as solid as I would like at this stage, there were plenty of other positives to be taken.

After three months of very large losses, the household survey reported a 227k jobs gain, dropping the unemployment rate back to 10.0%. And a 0.2 hour rise in the average workweek (each 0.1 hour being equivalent to a 350k jobs gain in terms of labor input applied and incomes) means that hours worked rose 0.6% MoM. Most important of all, temporary help rose 52k after an upwardly revised 44k last month (making the fourth consecutive gain). This points to a return to positive payrolls growth before long. Indeed, forecasters are already pencilling in a 50k gain for this month, a forecast that will gain credence if the weekly jobless claims data maintain their recent rate of improvement.


Complete Story »]]> SPY DIA QQQQ BCS UBS SNV ZION SI C ERIC BHP RTP MT CBY KFT BASFY.PK RYAAY BA The Mole The 10 Most Traded European ADRs http://seekingalpha.com/article/176566-the-10-most-traded-european-adrs?source=feed 176566 The following 10 European ADRs have daily trading volume of over 2.5 million shares:

  1. Nokia (NOK)
  2. Alcatel-Lucent (ALU)
  3. ArcelorMittal (MT)
  4. Ericsson (ERIC)
  5. ABB
  6. UBS
  7. ING
  8. Vimpel Communications (VIP)
  9. Banco Santander (STD)
  10. Statoil (STO)

While many tech stocks are up this year, Nokia is still down 18% YTD. The financial giant ING has lost 15% YTD. Due to the strong rebound of the Russian market, Vimpel Communications has soared over 167% so far this year.

]]> Fri, 04 Dec 2009 06:52:00 -0500 David Hunkar David Hunkar submits:

The following 10 European ADRs have daily trading volume of over 2.5 million shares:

  1. Nokia (NOK)
  2. Alcatel-Lucent (ALU)
  3. ArcelorMittal (MT)
  4. Ericsson (ERIC)
  5. ABB
  6. UBS
  7. ING
  8. Vimpel Communications (VIP)
  9. Banco Santander (STD)
  10. Statoil (STO)

While many tech stocks are up this year, Nokia is still down 18% YTD. The financial giant ING has lost 15% YTD. Due to the strong rebound of the Russian market, Vimpel Communications has soared over 167% so far this year.


Complete Story »]]> NOK ALU ERIC ABB MT UBS ING VIP STD STO David Hunkar Nortel's Bankruptcy Garage Sale Scorecard http://seekingalpha.com/article/175045-nortel-s-bankruptcy-garage-sale-scorecard?source=feed 175045 It has been nearly a year since Nortel (NRTLQ.PK) filed for bankruptcy protection, and five months since the company announced it was going to sell all of its assets instead of attempting to emerge as the New Nortel. Here’s a scorecard of what’s been sold, and what’s still on the block:

  • In February, Nortel sold its data-switch business (part of of its Layer 4 to Layer 7 portfolio) to Israel’s Radware (RDWR) for $17.7-million. The assets were part of Nortel’s $7.8-billion purchase of Alteon WebSystems in 2000.
  • The CDMA wirleess business and LTE R&D unit was sold to Ericsson for $1.13-billion. Ericsson (ERIC) has hired 800 ex-Nortel employees. Nokia Siemens Networks made an original stalking horse bid of $650-million.
  • The metro Ethernet network business, considered to be Nortel’s “crown jewel” a year ago when it was put on the block, was acquired by Ciena Corp. (CIEN) for $769-million after outbidding Nokia Siemens (NOK, SI). Ciena, which originally bid $511-million, plans to hire 2,000 MEN employees.
  • Avaya bought Nortel’s enterprise business for $900-million, nearly double the $475-million “stalking horse” offer it originally made.
  • Hitachi (HIT) purchased certain software assets and technology related to next generation packet core network components for $10-million.

Total Proceeds: $2.82-billion

]]> Tue, 24 Nov 2009 08:59:18 -0500 Mark Evans Mark Evans submits:

It has been nearly a year since Nortel (NRTLQ.PK) filed for bankruptcy protection, and five months since the company announced it was going to sell all of its assets instead of attempting to emerge as the New Nortel. Here’s a scorecard of what’s been sold, and what’s still on the block:

  • In February, Nortel sold its data-switch business (part of of its Layer 4 to Layer 7 portfolio) to Israel’s Radware (RDWR) for $17.7-million. The assets were part of Nortel’s $7.8-billion purchase of Alteon WebSystems in 2000.
  • The CDMA wirleess business and LTE R&D unit was sold to Ericsson for $1.13-billion. Ericsson (ERIC) has hired 800 ex-Nortel employees. Nokia Siemens Networks made an original stalking horse bid of $650-million.
  • The metro Ethernet network business, considered to be Nortel’s “crown jewel” a year ago when it was put on the block, was acquired by Ciena Corp. (CIEN) for $769-million after outbidding Nokia Siemens (NOK, SI). Ciena, which originally bid $511-million, plans to hire 2,000 MEN employees.
  • Avaya bought Nortel’s enterprise business for $900-million, nearly double the $475-million “stalking horse” offer it originally made.
  • Hitachi (HIT) purchased certain software assets and technology related to next generation packet core network components for $10-million.

Total Proceeds: $2.82-billion


Complete Story »]]> CIEN RDWR ERIC HIT NRTLQ.PK Mark Evans Genuity Capital: Wireless Trends from the Open Mobile Summit http://seekingalpha.com/article/172651-genuity-capital-wireless-trends-from-the-open-mobile-summit?source=feed 172651 The world of investment banking tech research analysts is a competitive one, so the saavy types make a strong effort to step beyond the traditional quarterly report publication grind. A great example of this came from Genuity Capital Markets, whose Wireless Analyst spent some time in California at the Open Mobile Summit. Here’s a snapshot of his findings:

Open Mobile Summit – An industry conflicted that will remain volatile

]]> Wed, 11 Nov 2009 01:44:28 -0500 Mark McQueen Mark McQueen (Wellington Financial) submits:

The world of investment banking tech research analysts is a competitive one, so the saavy types make a strong effort to step beyond the traditional quarterly report publication grind. A great example of this came from Genuity Capital Markets, whose Wireless Analyst spent some time in California at the Open Mobile Summit. Here’s a snapshot of his findings:

Open Mobile Summit – An industry conflicted that will remain volatile


Complete Story »]]> GOOG T ADBE QCOM ERIC INTC PALM AAPL BDWRF.PK SWIR Mark McQueen Why It's the Right Time for EZchip http://seekingalpha.com/article/171367-why-it-s-the-right-time-for-ezchip?source=feed 171367 Israeli router chip company EZchip Semiconductor Ltd. (EZCH) supplies, via its Yokne’am neighbor Marvell (MRVL), the chips for Cisco’s new routers. These are advanced routers currently undergoing checks and trials at many Cisco (CSCO) customers, particularly the giant telecommunications companies. For EZchip, this probably means that it is on the eve of a strong boost to sales and profits. The growth will come all at once in one of the coming quarters.

This being the case, I am exploiting EZchip’s low share price, and tripling my investment in it. I added EZchip to my portfolio exactly three years ago, when I wrote that the train was leaving the station, and that after many years of development, the company was on a strong growth track. This indeed is what happened, mainly because of Juniper Networks (JNPR), which built its MX family of routers around the second generation of EZchip chips. Along the way, I took advantage of the steep rise in the share price, and sold half my holding at a large profit.

]]> Thu, 05 Nov 2009 01:32:27 -0500 Shlomi Cohen Shlomi Cohen submits:

Israeli router chip company EZchip Semiconductor Ltd. (EZCH) supplies, via its Yokne’am neighbor Marvell (MRVL), the chips for Cisco’s new routers. These are advanced routers currently undergoing checks and trials at many Cisco (CSCO) customers, particularly the giant telecommunications companies. For EZchip, this probably means that it is on the eve of a strong boost to sales and profits. The growth will come all at once in one of the coming quarters.

This being the case, I am exploiting EZchip’s low share price, and tripling my investment in it. I added EZchip to my portfolio exactly three years ago, when I wrote that the train was leaving the station, and that after many years of development, the company was on a strong growth track. This indeed is what happened, mainly because of Juniper Networks (JNPR), which built its MX family of routers around the second generation of EZchip chips. Along the way, I took advantage of the steep rise in the share price, and sold half my holding at a large profit.


Complete Story »]]> EZCH MRVL CSCO JNPR CIEN ZTCOF.PK ECIL ERIC TLAB MOT NOK CRNT ORCT Shlomi Cohen Sprint Reports Loss, Again http://seekingalpha.com/article/169981-sprint-reports-loss-again?source=feed 169981 Sprint Nextel (S) reported third-quarter 2009 results with net loss per share of 17 cents, exceeding the Zacks Consensus Estimate of 15 cents and the year-ago loss per share of 11 cents. (See earnings call transcript.)

The third-largest US wireless carrier posted a net loss of $478 million, 47% more than the net loss of $326 million reported a year ago. Sprint remains significantly challenged by the volatile economic backdrop, which has contributed to the sustained decline in the wireless subscriber base and associated revenues.

]]> Thu, 29 Oct 2009 17:34:14 -0400 Zacks.com Zacks.com submits:

Sprint Nextel (S) reported third-quarter 2009 results with net loss per share of 17 cents, exceeding the Zacks Consensus Estimate of 15 cents and the year-ago loss per share of 11 cents. (See earnings call transcript.)

The third-largest US wireless carrier posted a net loss of $478 million, 47% more than the net loss of $326 million reported a year ago. Sprint remains significantly challenged by the volatile economic backdrop, which has contributed to the sustained decline in the wireless subscriber base and associated revenues.


Complete Story »]]> S VM PALM VZ T ERIC Zacks.com Full Featured Cell Phones Going the Way of the PDA http://seekingalpha.com/article/168810-full-featured-cell-phones-going-the-way-of-the-pda?source=feed 168810 Functionality, popularity, and the economy are altering the cell phone landscape. We see a divergence in the mobile phone market – a movement away from Feature Phones to Smartphones on the high end and plain voice phones on the low end, particularly in third-world countries.

As a result, the market for Feature Phones will decrease from 59.4% of cell phones in 2008 to 33.6% in 2013, as shown in the chart below.

]]> Mon, 26 Oct 2009 08:21:03 -0400 Robert Castellano Robert Castellano submits:

Functionality, popularity, and the economy are altering the cell phone landscape. We see a divergence in the mobile phone market – a movement away from Feature Phones to Smartphones on the high end and plain voice phones on the low end, particularly in third-world countries.

As a result, the market for Feature Phones will decrease from 59.4% of cell phones in 2008 to 33.6% in 2013, as shown in the chart below.


Complete Story »]]> JAVA QCOM NOK MOT ERIC Robert Castellano Report from Europe: Traders are Selling the News http://seekingalpha.com/article/168161-report-from-europe-traders-are-selling-the-news?source=feed 168161

It's turning into one of those, “You gotta know when to hold ‘em , know when to fold ‘em” periods, as stocks slipped late Wednesday on the banana skin of a Wells Fargo (WFC) downgrade to a “sell” from CNBC regular Dick Bove, who expressed concerns about “a serious erosion in the bank’s loan quality.” The stock lost 5% and dragged financials down in its wake. Amgen (AMGN) and eBay (EBAY) also disappointed after the bell. It really feels like the equity markets are starting to hit the saturation point. Valuations looked stretched and despite more “better than expected earnings,” it was the outlooks that are worrying me. The shock and awe of stronger-than-expected outcomes is dissipating and the onus is shifting back to the data.

The dive in US equities in the final hour of Wednesday is not an attractive set-up from a technical perspective, either. Firstly, a new high for the year was made early in the day, and then the S&P500 index closed on its low, below the range of the previous day and in fact the low for the last week. This is a key day reversal pattern and suggests significant fatigue and portends a period of retracement. The market is also displaying fatigue in that earnings reports have generally been upbeat and yet the market fell.

]]> Thu, 22 Oct 2009 11:49:31 -0400 The Mole The Mole submits:

It's turning into one of those, “You gotta know when to hold ‘em , know when to fold ‘em” periods, as stocks slipped late Wednesday on the banana skin of a Wells Fargo (WFC) downgrade to a “sell” from CNBC regular Dick Bove, who expressed concerns about “a serious erosion in the bank’s loan quality.” The stock lost 5% and dragged financials down in its wake. Amgen (AMGN) and eBay (EBAY) also disappointed after the bell. It really feels like the equity markets are starting to hit the saturation point. Valuations looked stretched and despite more “better than expected earnings,” it was the outlooks that are worrying me. The shock and awe of stronger-than-expected outcomes is dissipating and the onus is shifting back to the data.

The dive in US equities in the final hour of Wednesday is not an attractive set-up from a technical perspective, either. Firstly, a new high for the year was made early in the day, and then the S&P500 index closed on its low, below the range of the previous day and in fact the low for the last week. This is a key day reversal pattern and suggests significant fatigue and portends a period of retracement. The market is also displaying fatigue in that earnings reports have generally been upbeat and yet the market fell.


Complete Story »]]> WFC AMGN EBAY T MRK KMB MCD XRX MMM C BAC AIG NSRGY.PK ERIC PDRDF.PK The Mole Wall Street Breakfast: Must-Know News http://seekingalpha.com/article/168081-wall-street-breakfast-must-know-news?source=feed 168081

  • U.S. AAA rating not guaranteed. The U.S. could lose its AAA rating if it fails to reduce its deficit over the next 3-4 years, Moody's says. Steven Hess, Moody's lead analyst for the U.S., acknowledges reducing the gap won't be easy: "Raising taxes is never popular and difficult politically, so we have to see if the government can do that or cut expenditures." Earlier this year, markets were spooked after S&P cut its outlook on Britain to Negative from Stable. Meanwhile, Moody's said today European countries' rising debt won't trigger across-the-board downgrades.
  • Deep pay cuts coming to TARP recipients. In a plan to be made public within the next few days, the government will order deep pay cuts at the biggest bailout recipients - Citigroup (C), Bank of America (BAC), AIG (AIG), GM, Chrysler, GMAC and Chrysler Financial. The plan targets the 25 top earners at each company, who will see their compensation decline this year by about 50%, while bonus payments will be slashed by up to 90%, to be replaced by stock that they'll be restricted from immediately selling. The plan does not address firms that didn't receive bailout funds, or that have already repaid their loans.
  • South Korea's $3.9B oil buy. State-owned Korea National Oil Corp. agreed to buy Canada's Harvest Energy (HTE) for $3.9B - $1.7B for its outstanding shares and the assumption of $2.2B in debt. Shareholders will receive $9.52/share - a 37% premium to Wednesday's close. The deal is South Korea's biggest outbound cross-border deal ever in the Oil & Gas sector, and ranks seventh in global Oil & Gas sector M&A transactions in 2009. Harvest produced 53K b/d in Q2, 70% of which was crude oil and 30% was natural gas. Shares +29.1% premarket to $9.05.
  • Bove drops a bomb. Rochdale Securities analyst Richard Bove sent stocks into a tailspin late Wednesday after he downgraded shares of Wells Fargo (WFC) to Sell, despite a consensus-beating Q3. Bove is concerned by the positive impact mortgage hedges have had on Wells' recent results, which "keep coming through for the company whenever it needs to bolster earnings," but are a nightmare for investors who shouldn't look at such activity as generating predictable or repeatable profits. Bove also called the portfolio Wells acquired from Wachovia 'cancerous.' WFC -5.1% yesterday.
  • eBay falters on gloomy outlook. eBay (EBAY) posted Q3 earnings that exceeded expectations, but shares traded lower after-hours after its guidance gave a gloomier vision of the near future than many expected (read eBay's Q3 earnings call transcript). eBay has struggled as online shopping habits have shifted away from auctions to fixed-price purchases on sites such as Amazon.com (AMZN).
  • Beige Book sees signs of growth. The Fed said most regional economies are on the mend, as home sales rebound and manufacturers restart idled operations. "Reports of gains in economic activity generally outnumber declines, but virtually every reference to improvement was qualified as either small or scattered," the Fed said in its beige book tally. The report also highlighted how heavily businesses are relying on government spending: "There were several reports that the only 'sure' business will come from government stimulus projects, although funding for such projects has been slow to materialize," it said.
  • Microsoft's big day. Microsoft's much-anticipated OS upgrade, Windows 7, goes on sale today. The company hopes Windows 7 will gain more traction among retail and corporate clients than its most predecessor, Vista, which was seen as slow and clunky. Analysts say the new OS isn't likely to cause a sudden spike in PC sales, a point conceded by Microsoft CEO Steve Ballmer, who said recently IT budgets "aren't going to rise just because we shipped a new version."
  • Twin deals for Twitter. Twitter inked deals to sell the rights to mine its pipeline of 'tweets' with both Google (GOOG) and Microsoft (MSFT) Wednesday, underscoring the growing importance of real time search. Neither would say how much it's paying for the rights to index the millions of daily tweets, considered to be Twitter's most valuable asset. The deals could be the first meaningful revenue for Twitter since its 2006 inception, and begin to answer the much-explored question of "where's the beef?"
  • A strong Q3 for China. China's Q3 GDP came in at 8.9%, just below the 9% economists forecast. Separate reports showed industrial production and retail sales also accelerated. China's return to robust growth continues to raise the question of when policy makers will withdraw record fiscal and monetary stimulus in order to avoid another bubble.
  • Galleon wind down begins. Managers of Galleon Group's $500M Asia fund are considering buying the unit, sources say. On Wednesday, Galleon told employees and investors it would wind down the firm after its founder was charged with insider trading. Unless the government intervenes, investors likely won't get their money back until Jan. 1, 2010.

Earnings: Thur. Before Open

  • 3M Company (MMM): Q3 EPS of $1.37 beats by $0.20. Revenue of $6.19B (-5.6%) vs. $5.77B. Shares +1.2% premarket. (PR)
  • AT&T (T): Q3 EPS of $0.54 beats by $0.04. Revenue of $30.9B (-1.3%) in-line. Wireless subscribers +2M to 81.6M. Shares +2% premarket. (PR)
  • AU Optronics (AUO): Q3 EPS of $0.26 beats by $0.01. Revenue of $3.5B (+8.4%) vs. $3.21B. Operating margin 6.8%. Shares -2.3% in Taiwan. (PR)
  • Black & Decker (BDK): Q3 EPS of $0.91 beats by $0.09. Revenue of $1.21B (-23%) in-line. Sees Q4 EPS of $0.68-0.78 vs. $0.50 consensus. Shares +2.2% premarket. (PR)
  • Bristol-Myers (BMY): Q3 EPS of $0.52 beats by $0.01. Revenue of $5.49B (+4.4%) in-line. (PR)
  • Bunge (BG): Q3 EPS of $1.62 beats by $0.15. Revenue of $11.3B (-23.6%) vs. $12B. Sees full-year EPS of $3.10-$3.50 vs. consensus of $4.69. Says fertilizer business continues to be pressured by high-cost inventory and a weak pricing environment. (PR)
  • Celgene (CELG): Q3 EPS of $0.56 beats by $0.02. Revenue of $692M (+16.8%) vs. $671M. Shares +5.4% premarket. (PR)
  • Check Point Software (CHKP): Q3 EPS of $0.52 beats by $0.03. Revenue of $234M (+17%) vs. $231M. (PR)
  • CONSOL Energy (CNX): Q3 EPS of $0.48 misses by $0.18. Revenue of $1.09B (-6.7%) in-line. Shares -3.1% premarket. (PR)
  • Cooper Industries (CBE): Q3 EPS of $0.70 beats by $0.06. Revenue of $1.29B (-25.6%) in-line. "Revenue and orders for maintenance and repair items and product lines that declined rapidly at the beginning of the economic downturn are beginning to improve, while the longer cycle products appear to have now bottomed." Shares -0.3% premarket. (PR)
  • Danaher (DHR): Q3 EPS of $0.89 beats by $0.03. Revenue of $2.75B (-14.2%) in-line. (PR)
  • Delta Air Lines (DAL): Q3 EPS of $0.06 beats by $0.11. Revenue of $7.57B (+32.4%) in-line. (PR)
  • Diamond Offshore Drilling (DO): Q3 EPS of $2.62 beats by $0.32. Revenue of $908M (+0.9%) vs. $874M. Declares special dividend of $1.875/share. (PR)
  • Dow Chemical (DOW): Q3 EPS of $0.24 beats by $0.14. Revenue of $12.05B (+6.4%) vs. $11.85B. "The economic outlook for the rest of 2009 appears to be stabilizing with strong growth in Asia Pacific, especially China, and other emerging geographies. The global economy is now on firmer footing, and, in our view, the U.S. economy is beginning a slow and tenuous recovery, with unemployment continuing to be a drag on consumer spending." (PR)
  • EMC (EMC): Q3 EPS of $0.23 beats by $0.02. Revenue of $3.52B (-5.3%) vs. $3.45B. Says customers are signaling more comfort spending their IT budgets. Shares +1.5% premarket. (PR)
  • Ensco International (ESV): Q3 EPS of $1.05 beats by $0.01. Revenue of $425M (-31.3%) vs. $439M. (PR)
  • Entergy (ETR): Q3 EPS of $2.40 misses by $0.08. Revenue of $2.94B (-25.9%) vs. $3.9B. "We continue to experience the negative effects of the slowed economic recovery." (PR)
  • Ericsson (ERIC): Q3 EPS of 0.25kr misses by 0.61kr. Revenue of 46.4Bkr (-5.7%) vs. 49.46Bkr. "Sales of network equipment declined due to lower demand in the current tougher market environment. Despite lower volumes, Network margins remain stable." Shares -8.9% premarket. (PR)
  • Fifth Third Bancorp (FITB): Q3 EPS of -$0.20 beats by $0.03. Revenue of $M in-line. "The credit environment remains challenging, and we continue to aggressively work to manage risk in the portfolio." Shares -2.1% premarket. (PR)
  • Goodrich (GR): Q3 EPS of $1.12 beats by $0.09. Revenue of $1.65B (-7%) in-line. (PR)
  • Hershey Foods (HSY): Q3 EPS of $0.73 beats by $0.06. Revenue of $1.48B (-0.3%) vs. $1.54B. "As we look to 2010, we assume the economic environment for consumers in the U.S. and international markets will continue to be challenging." Shares +2.5% premarket. (PR)
  • Huntington Bancshares (HBAN): Q3 EPS of -$0.33 misses by $0.05. Revenue of $M in-line. Shares -2.1% premarket. (PR)
  • IMS Health (RX): Q3 EPS of $0.40 beats by $0.04. Revenue of $541M (-5.7%) vs. $522M. (PR)
  • Janus Capital Group (JNS): Q3 EPS of $0.05 misses by $0.10. Revenue of $228M (-17.4%) vs. $225M. (PR)
  • JetBlue Airways (JBLU): Q3 EPS of $0.04 misses by $0.01. Revenue of $854M (-5.3%) vs. $847M. Shares +1.2% premarket. (PR)
  • Kimberly-Clark (KMB): Q3 EPS of $1.40 beats by $0.27. Revenue of $4.91B (-1.7%) in-line. Sees full-year EPS of $4.50-$4.60 vs. consensus of $4.26, citing increased cost savings, better organic sales growth and a further recovery in currency exchange rates. Shares +5.5% premarket. (PR)
  • Laboratory Corp. (LH): Q3 EPS of $1.22 beats by $0.07. Revenue of $1.19B (+4.4%) in-line. (PR)
  • Legg Mason (LM): FQ2 EPS of $0.30 beats by $0.11. Revenue of $660M (-31.7%) vs. $652M. (PR)
  • Logitech (LOGI): FQ2 EPS of $0.11 beats by $0.06. Revenue of $498M (-25.1%) vs. $474M. Sees FQ3 revenue of $575-595M vs. $623M. Shares +7.2% in Zurich. (PR)
  • McDonald's (MCD): Q3 EPS of $1.15 beats by $0.04. Revenue of $6.05B (-3.5%) in-line. Comps +3.8%, with U.S. +2.5%, Europe +5.8% and the rest +2.2%. Shares +1.3% premarket. (PR)
  • Mead Johnson (MJN): Q3 EPS of $0.53 misses by $0.02. Revenue of $700M (-5.8%) vs. $737M. Shares -8.4% premarket. (PR)
  • Merck (MRK): Q3 EPS of $0.90 beats by $0.08. Revenue of $6.05B (+1.8%) in-line. (PR)
  • NCR (NCR): Q3 EPS of $0.19 misses by $0.05. Revenue of $1.14B (-17.7%) vs. $1.22B. Sees full-year EPS of $0.45-0.55 vs. $0.67. "The willingness of customers to invest in Q2... did not spill over into Q3. That said, we were more encouraged by the conversations we were having with our customers about Q4 and 2010." Shares -5.9% premarket. (PR)
  • New York Times (NYT): Q3 EPS of $0.16 beats by $0.17. Revenue of $571M (-16.9%) vs. $562M. Shares +2.7% premarket. (PR)
  • NII Holdings (NIHD): Q3 EPS of $0.69 beats by $0.14. Revenue of $1.14B (-3.5%) in-line. (PR)
  • Nucor (NUE): Q3 EPS of -$0.10 beats by $0.05. Revenue of $3.12B (-58.1%) vs. $2.98B. "Our view remains that there has been little improvement in real demand and the uncertainty in our economy is still very high. We also continue to believe that real demand is in for a long, slow recovery." Shares -0.6% premarket. (PR)
  • Occidental Petroleum (OXY): Q3 EPS of $1.14 beats by $0.06. Revenue of $4.1B (-41.9%) in-line. Shares +1.2% premarket. (PR)
  • Old Republic International (ORI): Q3 EPS of -$0.283 misses by $0.11. Revenue of $959M (+2.4%) vs. $910M. (PR)
  • Philip Morris (PM): Q3 EPS of $0.93 beats by $0.02. Revenue of $6.59B (-5.3%) vs. $6.71B. "While we experienced lower organic volume in the quarter, this was largely anticipated given our pricing actions and the on-going impact of the economic crisis on total consumption levels." Shares +0.75% premarket. (PR)
  • PNC Financial Services (PNC): Q3 EPS of $1.00 beats by $0.69. Revenue of $4.05B (+144.7%) vs. $3.8B. (PR)
  • Potash (POT): Q3 EPS of $0.82 beats by $0.01. Revenue of $1.1B (-64.1%) in-line. Sees Q4 EPS of $0.65-0.85 vs. consensus of $1.18. "The uncertainty among fertilizer buyers has lasted far longer than we anticipated, but cannot continue indefinitely." Shares -2.9% premarket. (PR)
  • ProLogis (PLD): Q3 EPS of $0.21 beats by $0.02. Revenue of $274M (-72.3%) vs. $228M. Shares +2.4% premarket. (PR)
  • Raytheon (RTN): Q3 EPS of $1.25 beats by $0.09. Revenue of $6.21B (+5.8%) in-line. Shares +0.7% premarket. (PR)
  • Reliance Steel & Aluminum (RS): Q3 EPS of $0.57 beats by $0.11. Revenue of $1.24B (-57.1%) vs. $1.34B. Declines Q4 guidance. "We believe that demand is fairly stable at low levels." (PR)
  • Reynolds American (RAI): Q3 EPS of $1.24 beats by $0.07. Revenue of $2.15B (-5.3%) in-line. Shares -0.1% premarket. (PR)
  • Ryder System (R): Q3 EPS of $0.50 beats by $0.05. Revenue of $1.26B (-20.3%) in-line. Anticipates the weak overall economic environment and protracted freight recession will continue to impact its performance. (PR)
  • Schering-Plough (SGP): Q3 EPS of $0.40 in-line. Revenue of $4.5B (-1.7%) in-line. (PR)
  • Starwood Hotels (HOT): Q3 EPS of $0.14 beats by $0.04. Revenue of $1.22B (-20.7%) vs. $1.16B. "It is very difficult at this time to provide any definitive point of view on 2010. While business conditions have clearly stabilized, it is very hard to forecast the pace of recovery, especially rate." (PR)
  • SunTrust Banks (STI): Q3 EPS of -$0.60 misses by $0.05. Revenue of $1.94B (-21%) vs. $2.11B. Earnings include $131M writedown on debt. Allowance for loan losses +128M to $3.02B. (PR)
  • Sybase (SY): Q3 EPS of $0.63 beats by $0.06. Revenue of $293M (+3.3%) vs. $281M. Shares +2.2% premarket. (PR)
  • TASER International (TASR): Q3 EPS of -$0.05 misses by $0.02. Revenue of $26.8M vs. $20.9M. Shares -1.2% premarket. (PR)
  • Temple-Inland (TIN): Q3 EPS of $0.24 beats by $0.06. Revenue of $885M (-9.3%) vs. $876M. "As we look forward, economic conditions, while still uncertain, have stabilized and appear to be on a slow path to recovery." (PR)
  • Terra Industries (TRA): Q3 EPS of $0.45 misses by $0.07. Revenue of $347M (-56.1%) vs. $356M. Shares +0.8% premarket. (PR)
  • Thermo Fisher (TMO): Q3 EPS of $0.78 beats by $0.02. Revenue of $2.53B (-2%) in-line. (PR)
  • Travellers (TRV): Q3 EPS of $1.61 beats by $0.30. Revenue of $6.3B vs. $6B. Sees full-year EPS of $5.30-5.50 vs. consensus of $5.28. Raises quarterly dividend to $0.33 from $0.30. Authorizes an additional $6B share buyback. "We remain cautious about the magnitude of rate gains that are achievable in the near term given general economic conditions." (PR)
  • Union Pacific (UNP): Q3 EPS of $1.02 beats by $0.02. Revenue of $3.67B (-24.2%) in-line. "Business volumes seem to have stabilized, but at very low levels." (PR)
  • UPS (UPS): Q3 EPS of $0.55 beats by $0.03. Revenue of $11.15B in-line. Volume of 927M packages, -2.4%. "I'm encouraged by the signs of economic recovery that are becoming apparent, although we still have a long way to go," CEO Scott Davis said. Shares -1% premarket. (PR)
  • US Airways (LCC): Q3 EPS of -$0.83 beats by $0.11. Revenue of $2.72B, including $110 from a la carte revenue initiatives, in-line. Shares +3.4% premarket. (PR)
  • Xerox (XRX): Q3 EPS of $0.14 beats by $0.02. Revenue of $3.67B (-15.9%) in-line. Sees full-year EPS of $0.55-0.57 vs. consensus of $0.53. (8-K)
  • Zimmer (ZMH): Q3 EPS of $0.88 beats by $0.02. Revenue of $976M (+2.5%) vs. $954M. Shares +1.8% premarket. (PR)

Earnings: Wed. After Close

  • Alliance Data Systems (ADS): Q3 EPS of $0.83 misses by $0.51. Revenue of $483M (-5%) vs. $500M. Expects 2010 EPS of $6.00 vs. $6.10. Shares -6.3% AH. (PR)
  • Amgen (AMGN): Q3 EPS of $1.49 beats by $0.22. Revenue of $3.8B (-2%) in-line. Raises full-year EPS guidance to $4.90-5.05 from $4.80-4.95, vs. $4.88. Shares -3% AH. (PR)
  • Ameriprise Financial (AMP): Q3 EPS of $1.03 beats by $0.39. Revenue of $2B (+20%) vs. $2.1B. Debt-to-total-capital ratio of 18.7%. Shares +1.6% AH. (PR)
  • Citrix Systems (CTXS): Q3 EPS of $0.43 beats by $0.02. Revenue of $401M (+1%) vs. $400M. Sees full-year revenue up 8-9% sequentially to $1.73B. Shares -3.6% AH. (PR)
  • Covanta (CVA): Q3 EPS of $0.28 beats by $0.04. Revenue of $409M (-7%) vs. $388M. Shares +0.3% AH. (PR)
  • eBay (EBAY): Q3 EPS of $0.38 beats by $0.01. Revenue of $2.2B (+6%) vs. $2.1B. Shares -4.9% AH. (PR)
  • Equifax (EFX): Q3 EPS of $0.57 beats by $0.02. Revenue of $452M (-7%) in-line. Shares -3.2% AH. (PR)
  • F5 Networks (FFIV): FQ4 EPS of $0.50 beats by $0.09. Revenue of $175M (+2%) vs. $164M. Shares +8.1% AH. (PR)
  • Fidelity National Information Services (FIS): Q3 EPS of $0.46 misses by $0.01. Revenue of $851M (-4%) vs. $870M. Shares -0.4% AH. (PR)
  • Fidelity National Financial (FNF): Q3 EPS of $0.32 misses by $0.02. Revenue of $1.5B (+52%) in-line. Shares +0.2% AH. (PR)
  • Intersil (ISIL): Q3 EPS of $0.10 in-line. Revenue of $168M (-23%) vs. $162M. Sees Q4 EPS of $0.14-0.17 vs. $0.13. Shares -2.8% AH. (PR)
  • Knight Transportation (KNX): Q3 EPS of $0.16 in-line. Revenue of $173M (-17%) vs. $165M. Shares +1.2% AH. (PR)
  • Lam Research (LRCX): FQ1 EPS of $0.03 beats by $0.11. Revenue of $319M (+46%) vs. $288M. Shares +3.2% AH. (PR)
  • Newfield Exploration (NFX): Q3 EPS of $1.58 beats by $0.24. Revenue of $375M (-45%) vs. $536M. Shares -0.1% AH. (PR)
  • Noble (NE): Q3 EPS of $1.63 beats by $0.10. Revenue of $906M (+5%) in-line. Shares +1.1% AH. (PR)
  • Novellus Systems (NVLS): Q3 EPS of -$0.03 beats by $0.01. Revenue of $177M (-29%) vs. $172M. Shares +0.9% AH. (PR)
  • OSI Pharmaceuticals (OSIP): Q3 EPS of $0.81 beats by $0.49. Revenue of $111M (+18%) vs. $106M. Shares -1% AH. (PR)
  • Pactiv (PTV): Q3 EPS of $0.54 beats by $0.03. Revenue of $839M (-9%) vs. $858M. Shares -0.2% AH. (PR)
  • QLogic (QLGC): FQ2 EPS of $0.21 beats by $0.03. Revenue of $132M (-23%) vs. $126M. Shares -2.6% AH. (PR)
  • Range Resources (RRC): Q3 EPS of $0.26 beats by $0.04. Revenue of $204M (-67%) vs. $261M. Shares -0.2% AH. (PR)
  • Skechers (SKX): Q3 EPS of $0.52 beats by $0.17. Revenue of $405M (+1%) vs. $385M. Shares +5.2% AH. (PR)
  • Terex (TEX): Q3 EPS of -$0.95 misses by $0.61. Revenue of $1.2B (-51%) vs. $1.3B. Shares -10.5% AH. (PR)
  • TriQuint Semiconductor (TQNT): Q3 EPS of $0.10 in-line. Revenue of $173M (-7%) vs. $178M. Shares -19.9% AH. (PR)
  • VMware (VMW): Q3 EPS of $0.24 beats by $0.04. Revenue of $490M (+4%) vs. $474M. Sees Q4 revenue of v$540M-560M vs. $523M. Shares +1.6% AH. (PR)

Today's Markets

Asian and European markets followed the U.S. into the red Thursday. Stock futures are marginally lower.

]]> Thu, 22 Oct 2009 07:18:31 -0400 SA Editor Eli Hoffmann SA Editor Eli Hoffmann submits:

  • U.S. AAA rating not guaranteed. The U.S. could lose its AAA rating if it fails to reduce its deficit over the next 3-4 years, Moody's says. Steven Hess, Moody's lead analyst for the U.S., acknowledges reducing the gap won't be easy: "Raising taxes is never popular and difficult politically, so we have to see if the government can do that or cut expenditures." Earlier this year, markets were spooked after S&P cut its outlook on Britain to Negative from Stable. Meanwhile, Moody's said today European countries' rising debt won't trigger across-the-board downgrades.
  • Deep pay cuts coming to TARP recipients. In a plan to be made public within the next few days, the government will order deep pay cuts at the biggest bailout recipients - Citigroup (C), Bank of America (BAC), AIG (AIG), GM, Chrysler, GMAC and Chrysler Financial. The plan targets the 25 top earners at each company, who will see their compensation decline this year by about 50%, while bonus payments will be slashed by up to 90%, to be replaced by stock that they'll be restricted from immediately selling. The plan does not address firms that didn't receive bailout funds, or that have already repaid their loans.
  • South Korea's $3.9B oil buy. State-owned Korea National Oil Corp. agreed to buy Canada's Harvest Energy (HTE) for $3.9B - $1.7B for its outstanding shares and the assumption of $2.2B in debt. Shareholders will receive $9.52/share - a 37% premium to Wednesday's close. The deal is South Korea's biggest outbound cross-border deal ever in the Oil & Gas sector, and ranks seventh in global Oil & Gas sector M&A transactions in 2009. Harvest produced 53K b/d in Q2, 70% of which was crude oil and 30% was natural gas. Shares +29.1% premarket to $9.05.
  • Bove drops a bomb. Rochdale Securities analyst Richard Bove sent stocks into a tailspin late Wednesday after he downgraded shares of Wells Fargo (WFC) to Sell, despite a consensus-beating Q3. Bove is concerned by the positive impact mortgage hedges have had on Wells' recent results, which "keep coming through for the company whenever it needs to bolster earnings," but are a nightmare for investors who shouldn't look at such activity as generating predictable or repeatable profits. Bove also called the portfolio Wells acquired from Wachovia 'cancerous.' WFC -5.1% yesterday.
  • eBay falters on gloomy outlook. eBay (EBAY) posted Q3 earnings that exceeded expectations, but shares traded lower after-hours after its guidance gave a gloomier vision of the near future than many expected (read eBay's Q3 earnings call transcript). eBay has struggled as online shopping habits have shifted away from auctions to fixed-price purchases on sites such as Amazon.com (AMZN).
  • Beige Book sees signs of growth. The Fed said most regional economies are on the mend, as home sales rebound and manufacturers restart idled operations. "Reports of gains in economic activity generally outnumber declines, but virtually every reference to improvement was qualified as either small or scattered," the Fed said in its beige book tally. The report also highlighted how heavily businesses are relying on government spending: "There were several reports that the only 'sure' business will come from government stimulus projects, although funding for such projects has been slow to materialize," it said.
  • Microsoft's big day. Microsoft's much-anticipated OS upgrade, Windows 7, goes on sale today. The company hopes Windows 7 will gain more traction among retail and corporate clients than its most predecessor, Vista, which was seen as slow and clunky. Analysts say the new OS isn't likely to cause a sudden spike in PC sales, a point conceded by Microsoft CEO Steve Ballmer, who said recently IT budgets "aren't going to rise just because we shipped a new version."
  • Twin deals for Twitter. Twitter inked deals to sell the rights to mine its pipeline of 'tweets' with both Google (GOOG) and Microsoft (MSFT) Wednesday, underscoring the growing importance of real time search. Neither would say how much it's paying for the rights to index the millions of daily tweets, considered to be Twitter's most valuable asset. The deals could be the first meaningful revenue for Twitter since its 2006 inception, and begin to answer the much-explored question of "where's the beef?"
  • A strong Q3 for China. China's Q3 GDP came in at 8.9%, just below the 9% economists forecast. Separate reports showed industrial production and retail sales also accelerated. China's return to robust growth continues to raise the question of when policy makers will withdraw record fiscal and monetary stimulus in order to avoid another bubble.
  • Galleon wind down begins. Managers of Galleon Group's $500M Asia fund are considering buying the unit, sources say. On Wednesday, Galleon told employees and investors it would wind down the firm after its founder was charged with insider trading. Unless the government intervenes, investors likely won't get their money back until Jan. 1, 2010.

Earnings: Thur. Before Open

  • 3M Company (MMM): Q3 EPS of $1.37 beats by $0.20. Revenue of $6.19B (-5.6%) vs. $5.77B. Shares +1.2% premarket. (PR)
  • AT&T (T): Q3 EPS of $0.54 beats by $0.04. Revenue of $30.9B (-1.3%) in-line. Wireless subscribers +2M to 81.6M. Shares +2% premarket. (PR)
  • AU Optronics (AUO): Q3 EPS of $0.26 beats by $0.01. Revenue of $3.5B (+8.4%) vs. $3.21B. Operating margin 6.8%. Shares -2.3% in Taiwan. (PR)
  • Black & Decker (BDK): Q3 EPS of $0.91 beats by $0.09. Revenue of $1.21B (-23%) in-line. Sees Q4 EPS of $0.68-0.78 vs. $0.50 consensus. Shares +2.2% premarket. (PR)
  • Bristol-Myers (BMY): Q3 EPS of $0.52 beats by $0.01. Revenue of $5.49B (+4.4%) in-line. (PR)
  • Bunge (BG): Q3 EPS of $1.62 beats by $0.15. Revenue of $11.3B (-23.6%) vs. $12B. Sees full-year EPS of $3.10-$3.50 vs. consensus of $4.69. Says fertilizer business continues to be pressured by high-cost inventory and a weak pricing environment. (PR)
  • Celgene (CELG): Q3 EPS of $0.56 beats by $0.02. Revenue of $692M (+16.8%) vs. $671M. Shares +5.4% premarket. (PR)
  • Check Point Software (CHKP): Q3 EPS of $0.52 beats by $0.03. Revenue of $234M (+17%) vs. $231M. (PR)
  • CONSOL Energy (CNX): Q3 EPS of $0.48 misses by $0.18. Revenue of $1.09B (-6.7%) in-line. Shares -3.1% premarket. (PR)
  • Cooper Industries (CBE): Q3 EPS of $0.70 beats by $0.06. Revenue of $1.29B (-25.6%) in-line. "Revenue and orders for maintenance and repair items and product lines that declined rapidly at the beginning of the economic downturn are beginning to improve, while the longer cycle products appear to have now bottomed." Shares -0.3% premarket. (PR)
  • Danaher (DHR): Q3 EPS of $0.89 beats by $0.03. Revenue of $2.75B (-14.2%) in-line. (PR)
  • Delta Air Lines (DAL): Q3 EPS of $0.06 beats by $0.11. Revenue of $7.57B (+32.4%) in-line. (PR)
  • Diamond Offshore Drilling (DO): Q3 EPS of $2.62 beats by $0.32. Revenue of $908M (+0.9%) vs. $874M. Declares special dividend of $1.875/share. (PR)
  • Dow Chemical (DOW): Q3 EPS of $0.24 beats by $0.14. Revenue of $12.05B (+6.4%) vs. $11.85B. "The economic outlook for the rest of 2009 appears to be stabilizing with strong growth in Asia Pacific, especially China, and other emerging geographies. The global economy is now on firmer footing, and, in our view, the U.S. economy is beginning a slow and tenuous recovery, with unemployment continuing to be a drag on consumer spending." (PR)
  • EMC (EMC): Q3 EPS of $0.23 beats by $0.02. Revenue of $3.52B (-5.3%) vs. $3.45B. Says customers are signaling more comfort spending their IT budgets. Shares +1.5% premarket. (PR)
  • Ensco International (ESV): Q3 EPS of $1.05 beats by $0.01. Revenue of $425M (-31.3%) vs. $439M. (PR)
  • Entergy (ETR): Q3 EPS of $2.40 misses by $0.08. Revenue of $2.94B (-25.9%) vs. $3.9B. "We continue to experience the negative effects of the slowed economic recovery." (PR)
  • Ericsson (ERIC): Q3 EPS of 0.25kr misses by 0.61kr. Revenue of 46.4Bkr (-5.7%) vs. 49.46Bkr. "Sales of network equipment declined due to lower demand in the current tougher market environment. Despite lower volumes, Network margins remain stable." Shares -8.9% premarket. (PR)
  • Fifth Third Bancorp (FITB): Q3 EPS of -$0.20 beats by $0.03. Revenue of $M in-line. "The credit environment remains challenging, and we continue to aggressively work to manage risk in the portfolio." Shares -2.1% premarket. (PR)
  • Goodrich (GR): Q3 EPS of $1.12 beats by $0.09. Revenue of $1.65B (-7%) in-line. (PR)
  • Hershey Foods (HSY): Q3 EPS of $0.73 beats by $0.06. Revenue of $1.48B (-0.3%) vs. $1.54B. "As we look to 2010, we assume the economic environment for consumers in the U.S. and international markets will continue to be challenging." Shares +2.5% premarket. (PR)
  • Huntington Bancshares (HBAN): Q3 EPS of -$0.33 misses by $0.05. Revenue of $M in-line. Shares -2.1% premarket. (PR)
  • IMS Health (RX): Q3 EPS of $0.40 beats by $0.04. Revenue of $541M (-5.7%) vs. $522M. (PR)
  • Janus Capital Group (JNS): Q3 EPS of $0.05 misses by $0.10. Revenue of $228M (-17.4%) vs. $225M. (PR)
  • JetBlue Airways (JBLU): Q3 EPS of $0.04 misses by $0.01. Revenue of $854M (-5.3%) vs. $847M. Shares +1.2% premarket. (PR)
  • Kimberly-Clark (KMB): Q3 EPS of $1.40 beats by $0.27. Revenue of $4.91B (-1.7%) in-line. Sees full-year EPS of $4.50-$4.60 vs. consensus of $4.26, citing increased cost savings, better organic sales growth and a further recovery in currency exchange rates. Shares +5.5% premarket. (PR)
  • Laboratory Corp. (LH): Q3 EPS of $1.22 beats by $0.07. Revenue of $1.19B (+4.4%) in-line. (PR)
  • Legg Mason (LM): FQ2 EPS of $0.30 beats by $0.11. Revenue of $660M (-31.7%) vs. $652M. (PR)
  • Logitech (LOGI): FQ2 EPS of $0.11 beats by $0.06. Revenue of $498M (-25.1%) vs. $474M. Sees FQ3 revenue of $575-595M vs. $623M. Shares +7.2% in Zurich. (PR)
  • McDonald's (MCD): Q3 EPS of $1.15 beats by $0.04. Revenue of $6.05B (-3.5%) in-line. Comps +3.8%, with U.S. +2.5%, Europe +5.8% and the rest +2.2%. Shares +1.3% premarket. (PR)
  • Mead Johnson (MJN): Q3 EPS of $0.53 misses by $0.02. Revenue of $700M (-5.8%) vs. $737M. Shares -8.4% premarket. (PR)
  • Merck (MRK): Q3 EPS of $0.90 beats by $0.08. Revenue of $6.05B (+1.8%) in-line. (PR)
  • NCR (NCR): Q3 EPS of $0.19 misses by $0.05. Revenue of $1.14B (-17.7%) vs. $1.22B. Sees full-year EPS of $0.45-0.55 vs. $0.67. "The willingness of customers to invest in Q2... did not spill over into Q3. That said, we were more encouraged by the conversations we were having with our customers about Q4 and 2010." Shares -5.9% premarket. (PR)
  • New York Times (NYT): Q3 EPS of $0.16 beats by $0.17. Revenue of $571M (-16.9%) vs. $562M. Shares +2.7% premarket. (PR)
  • NII Holdings (NIHD): Q3 EPS of $0.69 beats by $0.14. Revenue of $1.14B (-3.5%) in-line. (PR)
  • Nucor (NUE): Q3 EPS of -$0.10 beats by $0.05. Revenue of $3.12B (-58.1%) vs. $2.98B. "Our view remains that there has been little improvement in real demand and the uncertainty in our economy is still very high. We also continue to believe that real demand is in for a long, slow recovery." Shares -0.6% premarket. (PR)
  • Occidental Petroleum (OXY): Q3 EPS of $1.14 beats by $0.06. Revenue of $4.1B (-41.9%) in-line. Shares +1.2% premarket. (PR)
  • Old Republic International (ORI): Q3 EPS of -$0.283 misses by $0.11. Revenue of $959M (+2.4%) vs. $910M. (PR)
  • Philip Morris (PM): Q3 EPS of $0.93 beats by $0.02. Revenue of $6.59B (-5.3%) vs. $6.71B. "While we experienced lower organic volume in the quarter, this was largely anticipated given our pricing actions and the on-going impact of the economic crisis on total consumption levels." Shares +0.75% premarket. (PR)
  • PNC Financial Services (PNC): Q3 EPS of $1.00 beats by $0.69. Revenue of $4.05B (+144.7%) vs. $3.8B. (PR)
  • Potash (POT): Q3 EPS of $0.82 beats by $0.01. Revenue of $1.1B (-64.1%) in-line. Sees Q4 EPS of $0.65-0.85 vs. consensus of $1.18. "The uncertainty among fertilizer buyers has lasted far longer than we anticipated, but cannot continue indefinitely." Shares -2.9% premarket. (PR)
  • ProLogis (PLD): Q3 EPS of $0.21 beats by $0.02. Revenue of $274M (-72.3%) vs. $228M. Shares +2.4% premarket. (PR)
  • Raytheon (RTN): Q3 EPS of $1.25 beats by $0.09. Revenue of $6.21B (+5.8%) in-line. Shares +0.7% premarket. (PR)
  • Reliance Steel & Aluminum (RS): Q3 EPS of $0.57 beats by $0.11. Revenue of $1.24B (-57.1%) vs. $1.34B. Declines Q4 guidance. "We believe that demand is fairly stable at low levels." (PR)
  • Reynolds American (RAI): Q3 EPS of $1.24 beats by $0.07. Revenue of $2.15B (-5.3%) in-line. Shares -0.1% premarket. (PR)
  • Ryder System (R): Q3 EPS of $0.50 beats by $0.05. Revenue of $1.26B (-20.3%) in-line. Anticipates the weak overall economic environment and protracted freight recession will continue to impact its performance. (PR)
  • Schering-Plough (SGP): Q3 EPS of $0.40 in-line. Revenue of $4.5B (-1.7%) in-line. (PR)
  • Starwood Hotels (HOT): Q3 EPS of $0.14 beats by $0.04. Revenue of $1.22B (-20.7%) vs. $1.16B. "It is very difficult at this time to provide any definitive point of view on 2010. While business conditions have clearly stabilized, it is very hard to forecast the pace of recovery, especially rate." (PR)
  • SunTrust Banks (STI): Q3 EPS of -$0.60 misses by $0.05. Revenue of $1.94B (-21%) vs. $2.11B. Earnings include $131M writedown on debt. Allowance for loan losses +128M to $3.02B. (PR)
  • Sybase (SY): Q3 EPS of $0.63 beats by $0.06. Revenue of $293M (+3.3%) vs. $281M. Shares +2.2% premarket. (PR)
  • TASER International (TASR): Q3 EPS of -$0.05 misses by $0.02. Revenue of $26.8M vs. $20.9M. Shares -1.2% premarket. (PR)
  • Temple-Inland (TIN): Q3 EPS of $0.24 beats by $0.06. Revenue of $885M (-9.3%) vs. $876M. "As we look forward, economic conditions, while still uncertain, have stabilized and appear to be on a slow path to recovery." (PR)
  • Terra Industries (TRA): Q3 EPS of $0.45 misses by $0.07. Revenue of $347M (-56.1%) vs. $356M. Shares +0.8% premarket. (PR)
  • Thermo Fisher (TMO): Q3 EPS of $0.78 beats by $0.02. Revenue of $2.53B (-2%) in-line. (PR)
  • Travellers (TRV): Q3 EPS of $1.61 beats by $0.30. Revenue of $6.3B vs. $6B. Sees full-year EPS of $5.30-5.50 vs. consensus of $5.28. Raises quarterly dividend to $0.33 from $0.30. Authorizes an additional $6B share buyback. "We remain cautious about the magnitude of rate gains that are achievable in the near term given general economic conditions." (PR)
  • Union Pacific (UNP): Q3 EPS of $1.02 beats by $0.02. Revenue of $3.67B (-24.2%) in-line. "Business volumes seem to have stabilized, but at very low levels." (PR)
  • UPS (UPS): Q3 EPS of $0.55 beats by $0.03. Revenue of $11.15B in-line. Volume of 927M packages, -2.4%. "I'm encouraged by the signs of economic recovery that are becoming apparent, although we still have a long way to go," CEO Scott Davis said. Shares -1% premarket. (PR)
  • US Airways (LCC): Q3 EPS of -$0.83 beats by $0.11. Revenue of $2.72B, including $110 from a la carte revenue initiatives, in-line. Shares +3.4% premarket. (PR)
  • Xerox (XRX): Q3 EPS of $0.14 beats by $0.02. Revenue of $3.67B (-15.9%) in-line. Sees full-year EPS of $0.55-0.57 vs. consensus of $0.53. (8-K)
  • Zimmer (ZMH): Q3 EPS of $0.88 beats by $0.02. Revenue of $976M (+2.5%) vs. $954M. Shares +1.8% premarket. (PR)

Earnings: Wed. After Close

  • Alliance Data Systems (ADS): Q3 EPS of $0.83 misses by $0.51. Revenue of $483M (-5%) vs. $500M. Expects 2010 EPS of $6.00 vs. $6.10. Shares -6.3% AH. (PR)
  • Amgen (AMGN): Q3 EPS of $1.49 beats by $0.22. Revenue of $3.8B (-2%) in-line. Raises full-year EPS guidance to $4.90-5.05 from $4.80-4.95, vs. $4.88. Shares -3% AH. (PR)
  • Ameriprise Financial (AMP): Q3 EPS of $1.03 beats by $0.39. Revenue of $2B (+20%) vs. $2.1B. Debt-to-total-capital ratio of 18.7%. Shares +1.6% AH. (PR)
  • Citrix Systems (CTXS): Q3 EPS of $0.43 beats by $0.02. Revenue of $401M (+1%) vs. $400M. Sees full-year revenue up 8-9% sequentially to $1.73B. Shares -3.6% AH. (PR)
  • Covanta (CVA): Q3 EPS of $0.28 beats by $0.04. Revenue of $409M (-7%) vs. $388M. Shares +0.3% AH. (PR)
  • eBay (EBAY): Q3 EPS of $0.38 beats by $0.01. Revenue of $2.2B (+6%) vs. $2.1B. Shares -4.9% AH. (PR)
  • Equifax (EFX): Q3 EPS of $0.57 beats by $0.02. Revenue of $452M (-7%) in-line. Shares -3.2% AH. (PR)
  • F5 Networks (FFIV): FQ4 EPS of $0.50 beats by $0.09. Revenue of $175M (+2%) vs. $164M. Shares +8.1% AH. (PR)
  • Fidelity National Information Services (FIS): Q3 EPS of $0.46 misses by $0.01. Revenue of $851M (-4%) vs. $870M. Shares -0.4% AH. (PR)
  • Fidelity National Financial (FNF): Q3 EPS of $0.32 misses by $0.02. Revenue of $1.5B (+52%) in-line. Shares +0.2% AH. (PR)
  • Intersil (ISIL): Q3 EPS of $0.10 in-line. Revenue of $168M (-23%) vs. $162M. Sees Q4 EPS of $0.14-0.17 vs. $0.13. Shares -2.8% AH. (PR)
  • Knight Transportation (KNX): Q3 EPS of $0.16 in-line. Revenue of $173M (-17%) vs. $165M. Shares +1.2% AH. (PR)
  • Lam Research (LRCX): FQ1 EPS of $0.03 beats by $0.11. Revenue of $319M (+46%) vs. $288M. Shares +3.2% AH. (PR)
  • Newfield Exploration (NFX): Q3 EPS of $1.58 beats by $0.24. Revenue of $375M (-45%) vs. $536M. Shares -0.1% AH. (PR)
  • Noble (NE): Q3 EPS of $1.63 beats by $0.10. Revenue of $906M (+5%) in-line. Shares +1.1% AH. (PR)
  • Novellus Systems (NVLS): Q3 EPS of -$0.03 beats by $0.01. Revenue of $177M (-29%) vs. $172M. Shares +0.9% AH. (PR)
  • OSI Pharmaceuticals (OSIP): Q3 EPS of $0.81 beats by $0.49. Revenue of $111M (+18%) vs. $106M. Shares -1% AH. (PR)
  • Pactiv (PTV): Q3 EPS of $0.54 beats by $0.03. Revenue of $839M (-9%) vs. $858M. Shares -0.2% AH. (PR)
  • QLogic (QLGC): FQ2 EPS of $0.21 beats by $0.03. Revenue of $132M (-23%) vs. $126M. Shares -2.6% AH. (PR)
  • Range Resources (RRC): Q3 EPS of $0.26 beats by $0.04. Revenue of $204M (-67%) vs. $261M. Shares -0.2% AH. (PR)
  • Skechers (SKX): Q3 EPS of $0.52 beats by $0.17. Revenue of $405M (+1%) vs. $385M. Shares +5.2% AH. (PR)
  • Terex (TEX): Q3 EPS of -$0.95 misses by $0.61. Revenue of $1.2B (-51%) vs. $1.3B. Shares -10.5% AH. (PR)
  • TriQuint Semiconductor (TQNT): Q3 EPS of $0.10 in-line. Revenue of $173M (-7%) vs. $178M. Shares -19.9% AH. (PR)
  • VMware (VMW): Q3 EPS of $0.24 beats by $0.04. Revenue of $490M (+4%) vs. $474M. Sees Q4 revenue of v$540M-560M vs. $523M. Shares +1.6% AH. (PR)

Today's Markets

Asian and European markets followed the U.S. into the red Thursday. Stock futures are marginally lower.


Complete Story »]]> DIA SPY QQQQ GLD USO ADS AIG AMGN AMP AUO BAC BG C CHKP CTXS CVA DHR DOW EBAY EFX ERIC ESV FFIV FIS FNF HOT HTE ISIL KNX LOGI LRCX NE NFX NVLS OSIP PNC POT PTV QLGC RRC SGP SKX STI TEX TMO TQNT TRV VMW WFC XRX AMZN BMY CBE DAL DO EMC ETR FITB GOOG GR KMB LM MCD MMM MRK MSFT NIHD PM RX T TRA UPS BDK CELG CNX HSY JBLU LH MJN NCR OXY RAI RTN TASR ZMH HBAN JNS NYT PLD R UNP LCC NUE ORI RS SY TIN Eli Hoffmann Wall Street Breakfast: Must-Know News http://seekingalpha.com/article/166948-wall-street-breakfast-must-know-news?source=feed 166948

  • Google goes for growth. Encouraged by a stronger economy and uplifting third-quarter profits, Google (GOOG) said it is gearing up for expansion. "While there is a lot of uncertainty about the pace of economic recovery, we believe the worst of the recession is behind us and now feel confident about investing heavily in our future," said CEO Eric Schmidt. The Internet search company said on Thursday that third-quarter revenue rose 7% over last year's same period, to $5.94 billion, as Internet advertising business brightened. Net income jumped 27% to $1.6 billion from a year ago. Google shares rose in after-hours trading. (read Google's Q3 earnings call transcript)
  • U.S. calls on China to loosen up. The U.S. Treasury took a fresh swipe at China's currency policy, saying in a semiannual report released Thursday that, "Both the rigidity of the renminbi and the reacceleration of reserve accumulation are serious concerns which should be corrected to help ensure a stronger, more balanced global economy consistent with the G-20 framework." Treasury, which stopped short of accusing China of manipulating its currency, said it continues to believe the renminbi is "undervalued." The G-20 framework calls for sustaining global growth and smoothing trade and investment flows.
  • Music merger in antitrust showdown. Ticketmaster Entertainment Inc. (TKTM) and Live Nation (LYV) are facing intense antitrust scrutiny for their proposed merger, announced in February, and may be forced to make concessions to complete the deal, sources say. The outcome could have potential repercussions for other high-profile deals such as Comcast’s (CMCSA) proposal to take a majority stake in General Electric’s (GE) NBC Universal. Ticketmaster and Live Nation, which have a combined stock-market value of $1.3B, had planned to close the deal by the end of this year. But the U.S. Justice Department may not rule before late November or 2010. The deal marks the first high-profile merger to come up for antitrust review during the Obama administration, which has vowed to take a tough antitrust stance.
  • Ken's annus horribilis. Embattled Bank of America (BAC) CEO Ken Lewis, already facing a slew of woes, now must forfeit his entire bonus and salary for 2009. U.S. pay czar Kenneth Feinberg said Lewis should pay back the $1M he has already received and give up the rest of his $1.5M pay for 2009. Lewis is bowing to Feinberg's demand, saying it's "not in the best interest of Bank of America for him to get involved in a dispute with the paymaster." However, Lewis – who is leaving this year – will be able to keep his retirement pay, currently worth between $69.3M and $120M.
  • Telephone partnership loosing connection? Nokia (NOK), the world’s largest phone maker, has raised questions about its commitment to Nokia Siemens Networks, after carving more than $1B off the value of its telephone-network venture with Siemens AG (SI) on Thursday, essentially wiping out all of the JV’s goodwill. Some say the writedown may be in preparation for a sale. The partnership saw its market share fall to 20% in Q2 from 26% a year earlier, while rival Ericsson (ERIC) is out in front with 32%. Nokia Siemens posted losses of more than €1.6B in the previous two years.
  • U.S. will hold world back - Soros. Billionaire investor George Soros says the U.S. will be a drag on world growth, and that the U.S. dollar ought to be falling against the Chinese yuan to allow the U.S. to contain its current-account deficit. Soros said Thursday that the world's current "currency arrangements" are fraught with danger and that the world needs global regulation.
  • CVC derails Express deal. CVC Capital Partners slammed the brakes on plans to buy Britain's bus and rail company, National Express, for $1.3B. The buyout firm provided no reason, saying only that it and Spain's Cosmen family, the transport company's biggest investor, won't press ahead. London's Takeover Panel said today was the "put up or shut up" deadline to make a firm offer or walk away for at least six months. National Express, which will now explore a stock sale, saw its shares plunge as much as 33% in London trading.
  • Historic pay package lives on. Lazard CEO Bruce Wasserstein, who died this week, was notorious for his blockbuster hostile takeovers. Now, he is achieving fresh notoriety for the enormous pay he commanded. Some 4.4M restricted stock units he held – worth $188M at today's prices – will be vested due to his death. The payout makes the legendary CEO one of history's most richly compensated investment bankers, at a time when Wall Street chieftains are under fire for taking outsized pay packages. Wasserstein's 2008 pay package was worth $20.4 million, most of it in restricted stock.
  • ... while Goldman plays it down. As the Wall Street bonus controversy blazes on, Goldman plunked a smaller chunk of revenue into its compensation pool. But employees need not cinch their belts: they are still on track to pocket an average of $630,000 each – rivaling record bonuses in 2007. Goldman has already set aside some $16.7B for bonuses this year, and looks headed toward the $20B mark. The firm may be hoping its recent show of austerity will quiet critics, but numbers like these make that unlikely.
  • Manufacturing continues to fuel U.S. growth. Manufacturing gains are catalyzing U.S. economic growth, today’s latest September Industrial production numbers is expected to show. Economists expect industrial production to climb for a third consecutive month, with output at factories, mines and utilities up 0.2% following increases of 0.8% and 1% in August and July. However, another report may show that consumer sentiment has moderated following the highest level it has seen in more than a year (see today's economic calendar below).
  • Mixed messages from industry. New York State manfacturing took a big turn for the better, with the NY Fed's Empire State Manufacturing Survey jumping to 34.57 vs. 18.88 last month and 19 expected - the highest level in 5 years. Employment index jumped to 10.4 from -8.3 last month. New orders surged to 30.8 from 19.8. Meanwhile, in Philadelphia the recovery was less apparent, with the Philly Fed's Business Outlook survey dropping to 11.5 vs. 14.1 last month and consensus of 12. Employment index -6.8 vs. -14.3 last month. New orders moved up to 6.2 from 3.3. Shipments were 3.3 vs. 8.2. Inventories fell to -31.8 vs. -18.1.
  • Job losses moderate. Weekly jobless claims fell to the lowest level since early January, dropping to 514,000 from 524K last week, just short of the 515K economists predicted. Continuing claims fell by 75K to 5.991M from 6.067M.

Earnings: Fri. Before Open

  • Bank of America (BAC): Q3 EPS of -$0.26 misses by $0.05. Revenue of $26.04B (+32.7%) vs. $27.61B. Adds $2.1B to credit loss reserves. "Obviously, credit costs remain high, and that is our major financial challenge going forward. However, we are heartened by early positive signs, such as the leveling of delinquencies among our credit card customers." (PR)
  • GE (GE): Q3 EPS of $0.27 beats by $0.07. Revenue of $37.8B (-20%) vs. $40.03B. CEO Jeff Immelt on GE Capital: "While it remains a tough environment for GE Capital, we are seeing signs of stabilization. Every segment at GE Capital was profitable with the exception of Real Estate, which is experiencing a tough environment but where we believe the risks are well understood and manageable." (PR)
  • First Horizon National (FHN): Q3 EPS of -$0.24 beats by $0.08. Revenue of $495M (-6.4%) vs. $504M. (PR)
  • Halliburton (HAL): Q3 EPS of $0.31 beats by $0.05. Revenue of $3.59B vs. $3.42B. "Overall market dynamics remained difficult in North America... Although I am more confident in our view of the international markets than I was last quarter, project deferrals together with pricing pressure, driven by our customers’ desire to reduce input costs, cause us to continue to expect a softer near-term margin outlook for international markets." (PR)
  • Mattel (MAT): Q3 EPS of $0.63 in-line. Revenue of $1.79B (-8.2%) in-line. ""As expected, revenues continue to be challenging this year due to the overall economic environment, retailers tightly managing inventory, foreign exchange rates and the lack of entertainment-inspired toy lines." (PR)

Earnings: Thur. After Close

  • Advanced Micro Devices (AMD): Q3 EPS of -$0.26 beats by $0.16. Revenue of $1.4B (-22%) vs. $1.26B. Sees Q4 product revenue up modestly. Shares -3.7% AH. (PR)
  • Google (GOOG): Q3 EPS of $5.89 beats by $0.47. Revenue of $4.38B (+7%) vs. $4.24B. Paid clicks +14%; cost per click -6%. "While there is a lot of uncertainty about the pace of economic recovery, we believe the worst of the recession is behind us and now feel confident about investing heavily in our future." Shares +3.6% premarket. (PR)
  • IBM (IBM): Q3 EPS of $2.40 beats by $0.02. Revenue of $23.6B (-7%) vs. $23.4B. Raises full-year EPS guidance to at least $9.85 from $9.70, vs. $9.78. "We saw improved revenue trends in our business and share gains in software and hardware." Remains "well ahead of pace" for 2010 roadmap of $10-$11/share. Shares -3.9% AH. (PR)
  • People's Bank (PBCT): Q3 EPS of $0.08 in-line. Net interest income of $145M (-9%). Shares -1.5% AH. (PR)
  • Tempur-Pedic International (TPX): Q3 EPS of $0.34 beats by $0.08. Revenue of $224M (-11%) vs. $196M. Shares +12.7% AH. (PR)

Today's Markets

Asian markets were mixed Friday. European stocks have added modest gains, while futures are flat as investors await another batch of big-name Q3 earnings reports.

]]> Fri, 16 Oct 2009 07:18:56 -0400 Suzanne Miller Suzanne Miller submits:

  • Google goes for growth. Encouraged by a stronger economy and uplifting third-quarter profits, Google (GOOG) said it is gearing up for expansion. "While there is a lot of uncertainty about the pace of economic recovery, we believe the worst of the recession is behind us and now feel confident about investing heavily in our future," said CEO Eric Schmidt. The Internet search company said on Thursday that third-quarter revenue rose 7% over last year's same period, to $5.94 billion, as Internet advertising business brightened. Net income jumped 27% to $1.6 billion from a year ago. Google shares rose in after-hours trading. (read Google's Q3 earnings call transcript)
  • U.S. calls on China to loosen up. The U.S. Treasury took a fresh swipe at China's currency policy, saying in a semiannual report released Thursday that, "Both the rigidity of the renminbi and the reacceleration of reserve accumulation are serious concerns which should be corrected to help ensure a stronger, more balanced global economy consistent with the G-20 framework." Treasury, which stopped short of accusing China of manipulating its currency, said it continues to believe the renminbi is "undervalued." The G-20 framework calls for sustaining global growth and smoothing trade and investment flows.
  • Music merger in antitrust showdown. Ticketmaster Entertainment Inc. (TKTM) and Live Nation (LYV) are facing intense antitrust scrutiny for their proposed merger, announced in February, and may be forced to make concessions to complete the deal, sources say. The outcome could have potential repercussions for other high-profile deals such as Comcast’s (CMCSA) proposal to take a majority stake in General Electric’s (GE) NBC Universal. Ticketmaster and Live Nation, which have a combined stock-market value of $1.3B, had planned to close the deal by the end of this year. But the U.S. Justice Department may not rule before late November or 2010. The deal marks the first high-profile merger to come up for antitrust review during the Obama administration, which has vowed to take a tough antitrust stance.
  • Ken's annus horribilis. Embattled Bank of America (BAC) CEO Ken Lewis, already facing a slew of woes, now must forfeit his entire bonus and salary for 2009. U.S. pay czar Kenneth Feinberg said Lewis should pay back the $1M he has already received and give up the rest of his $1.5M pay for 2009. Lewis is bowing to Feinberg's demand, saying it's "not in the best interest of Bank of America for him to get involved in a dispute with the paymaster." However, Lewis – who is leaving this year – will be able to keep his retirement pay, currently worth between $69.3M and $120M.
  • Telephone partnership loosing connection? Nokia (NOK), the world’s largest phone maker, has raised questions about its commitment to Nokia Siemens Networks, after carving more than $1B off the value of its telephone-network venture with Siemens AG (SI) on Thursday, essentially wiping out all of the JV’s goodwill. Some say the writedown may be in preparation for a sale. The partnership saw its market share fall to 20% in Q2 from 26% a year earlier, while rival Ericsson (ERIC) is out in front with 32%. Nokia Siemens posted losses of more than €1.6B in the previous two years.
  • U.S. will hold world back - Soros. Billionaire investor George Soros says the U.S. will be a drag on world growth, and that the U.S. dollar ought to be falling against the Chinese yuan to allow the U.S. to contain its current-account deficit. Soros said Thursday that the world's current "currency arrangements" are fraught with danger and that the world needs global regulation.
  • CVC derails Express deal. CVC Capital Partners slammed the brakes on plans to buy Britain's bus and rail company, National Express, for $1.3B. The buyout firm provided no reason, saying only that it and Spain's Cosmen family, the transport company's biggest investor, won't press ahead. London's Takeover Panel said today was the "put up or shut up" deadline to make a firm offer or walk away for at least six months. National Express, which will now explore a stock sale, saw its shares plunge as much as 33% in London trading.
  • Historic pay package lives on. Lazard CEO Bruce Wasserstein, who died this week, was notorious for his blockbuster hostile takeovers. Now, he is achieving fresh notoriety for the enormous pay he commanded. Some 4.4M restricted stock units he held – worth $188M at today's prices – will be vested due to his death. The payout makes the legendary CEO one of history's most richly compensated investment bankers, at a time when Wall Street chieftains are under fire for taking outsized pay packages. Wasserstein's 2008 pay package was worth $20.4 million, most of it in restricted stock.
  • ... while Goldman plays it down. As the Wall Street bonus controversy blazes on, Goldman plunked a smaller chunk of revenue into its compensation pool. But employees need not cinch their belts: they are still on track to pocket an average of $630,000 each – rivaling record bonuses in 2007. Goldman has already set aside some $16.7B for bonuses this year, and looks headed toward the $20B mark. The firm may be hoping its recent show of austerity will quiet critics, but numbers like these make that unlikely.
  • Manufacturing continues to fuel U.S. growth. Manufacturing gains are catalyzing U.S. economic growth, today’s latest September Industrial production numbers is expected to show. Economists expect industrial production to climb for a third consecutive month, with output at factories, mines and utilities up 0.2% following increases of 0.8% and 1% in August and July. However, another report may show that consumer sentiment has moderated following the highest level it has seen in more than a year (see today's economic calendar below).
  • Mixed messages from industry. New York State manfacturing took a big turn for the better, with the NY Fed's Empire State Manufacturing Survey jumping to 34.57 vs. 18.88 last month and 19 expected - the highest level in 5 years. Employment index jumped to 10.4 from -8.3 last month. New orders surged to 30.8 from 19.8. Meanwhile, in Philadelphia the recovery was less apparent, with the Philly Fed's Business Outlook survey dropping to 11.5 vs. 14.1 last month and consensus of 12. Employment index -6.8 vs. -14.3 last month. New orders moved up to 6.2 from 3.3. Shipments were 3.3 vs. 8.2. Inventories fell to -31.8 vs. -18.1.
  • Job losses moderate. Weekly jobless claims fell to the lowest level since early January, dropping to 514,000 from 524K last week, just short of the 515K economists predicted. Continuing claims fell by 75K to 5.991M from 6.067M.

Earnings: Fri. Before Open

  • Bank of America (BAC): Q3 EPS of -$0.26 misses by $0.05. Revenue of $26.04B (+32.7%) vs. $27.61B. Adds $2.1B to credit loss reserves. "Obviously, credit costs remain high, and that is our major financial challenge going forward. However, we are heartened by early positive signs, such as the leveling of delinquencies among our credit card customers." (PR)
  • GE (GE): Q3 EPS of $0.27 beats by $0.07. Revenue of $37.8B (-20%) vs. $40.03B. CEO Jeff Immelt on GE Capital: "While it remains a tough environment for GE Capital, we are seeing signs of stabilization. Every segment at GE Capital was profitable with the exception of Real Estate, which is experiencing a tough environment but where we believe the risks are well understood and manageable." (PR)
  • First Horizon National (FHN): Q3 EPS of -$0.24 beats by $0.08. Revenue of $495M (-6.4%) vs. $504M. (PR)
  • Halliburton (HAL): Q3 EPS of $0.31 beats by $0.05. Revenue of $3.59B vs. $3.42B. "Overall market dynamics remained difficult in North America... Although I am more confident in our view of the international markets than I was last quarter, project deferrals together with pricing pressure, driven by our customers’ desire to reduce input costs, cause us to continue to expect a softer near-term margin outlook for international markets." (PR)
  • Mattel (MAT): Q3 EPS of $0.63 in-line. Revenue of $1.79B (-8.2%) in-line. ""As expected, revenues continue to be challenging this year due to the overall economic environment, retailers tightly managing inventory, foreign exchange rates and the lack of entertainment-inspired toy lines." (PR)

Earnings: Thur. After Close

  • Advanced Micro Devices (AMD): Q3 EPS of -$0.26 beats by $0.16. Revenue of $1.4B (-22%) vs. $1.26B. Sees Q4 product revenue up modestly. Shares -3.7% AH. (PR)
  • Google (GOOG): Q3 EPS of $5.89 beats by $0.47. Revenue of $4.38B (+7%) vs. $4.24B. Paid clicks +14%; cost per click -6%. "While there is a lot of uncertainty about the pace of economic recovery, we believe the worst of the recession is behind us and now feel confident about investing heavily in our future." Shares +3.6% premarket. (PR)
  • IBM (IBM): Q3 EPS of $2.40 beats by $0.02. Revenue of $23.6B (-7%) vs. $23.4B. Raises full-year EPS guidance to at least $9.85 from $9.70, vs. $9.78. "We saw improved revenue trends in our business and share gains in software and hardware." Remains "well ahead of pace" for 2010 roadmap of $10-$11/share. Shares -3.9% AH. (PR)
  • People's Bank (PBCT): Q3 EPS of $0.08 in-line. Net interest income of $145M (-9%). Shares -1.5% AH. (PR)
  • Tempur-Pedic International (TPX): Q3 EPS of $0.34 beats by $0.08. Revenue of $224M (-11%) vs. $196M. Shares +12.7% AH. (PR)

Today's Markets

Asian markets were mixed Friday. European stocks have added modest gains, while futures are flat as investors await another batch of big-name Q3 earnings reports.


Complete Story »]]> DIA SPY QQQQ GLD USO AMD BAC CMCSA ERIC FHN GE GOOG HAL IBM LYV MAT NOK PBCT SI TKTM TPX Suzanne Miller Asian Tech Stock Weekly Review (September 28 - October 2, 2009) http://seekingalpha.com/article/165249-asian-tech-stock-weekly-review-september-28-october-2-2009?source=feed 165249 Japan

Hardware

• Oki Data Corp. is initiating full-scale sales of printers in the Chinese market as part of an effort to make up for slumping sales elsewhere overseas. The Oki Electric Industry Co. subsidiary had two overseas sales organizations for printers, one for Europe and the U.S., and one for other foreign countries. It will create a third sales team at its headquarters to oversee sales in China. The new team, which is also slated to cover sales activities in Taiwan, will formulate sales plans and conduct market research. An executive responsible for sales in Japan will be appointed chairman of Oki Trading (Beijing) Co., Oki Data's local unit in Beijing, and management-level personnel will also be sent from Japan to branches in Shanghai and Guangzhou. Oki Trading has begun using endorsements from table tennis player Ai Fukuhara, who is popular there.

]]> Wed, 07 Oct 2009 06:11:29 -0400 IRG Japan

Hardware

• Oki Data Corp. is initiating full-scale sales of printers in the Chinese market as part of an effort to make up for slumping sales elsewhere overseas. The Oki Electric Industry Co. subsidiary had two overseas sales organizations for printers, one for Europe and the U.S., and one for other foreign countries. It will create a third sales team at its headquarters to oversee sales in China. The new team, which is also slated to cover sales activities in Taiwan, will formulate sales plans and conduct market research. An executive responsible for sales in Japan will be appointed chairman of Oki Trading (Beijing) Co., Oki Data's local unit in Beijing, and management-level personnel will also be sent from Japan to branches in Shanghai and Guangzhou. Oki Trading has begun using endorsements from table tennis player Ai Fukuhara, who is popular there.


Complete Story »]]> SNE ATE TOELF.PK AMAT NELTY.PK SQNXF.PK TYOYY.PK FJTSY.PK ERIC DCM CHU KTC LGERF.PK ALBCF.PK SNX SINA FMCN CHA ZTCOF.PK DELL HPQ LNVGY.PK TSL CDCS IRG Telecom Managed Services Could See Growth http://seekingalpha.com/article/163918-telecom-managed-services-could-see-growth?source=feed 163918 Massive deployment of high-speed wireless networks throughout the world has opened up a new market for telecom outsourcing and managed services for several telecom equipment manufacturing firms. The next-generation (3G/4G) wireless networks are aiming to cope with substantial demand for high-speed wireless data services and mobile video.

Telecom service providers are now typically looking at providing the converged IP-based network, offering bundled solutions for triple play voice, video and data. This requires the implementation of complex network architecture.

]]> Tue, 29 Sep 2009 10:54:07 -0400 Zacks.com Zacks.com submits:

Massive deployment of high-speed wireless networks throughout the world has opened up a new market for telecom outsourcing and managed services for several telecom equipment manufacturing firms. The next-generation (3G/4G) wireless networks are aiming to cope with substantial demand for high-speed wireless data services and mobile video.

Telecom service providers are now typically looking at providing the converged IP-based network, offering bundled solutions for triple play voice, video and data. This requires the implementation of complex network architecture.


Complete Story »]]> ERIC NOK SI ALU Zacks.com Thursday Options Recap http://seekingalpha.com/article/163301-thursday-options-recap?source=feed 163301 Sentiment

Stocks opened steady after suffering losses Wednesday and after the Labor Department reported that weekly jobless claims fell last week. According to the Labor Department, filings for jobless benefits fell by 21,000 to 530,000 in the week ended September 19. Economists were expecting a drop to 550,000. The Dow Jones Industrial Average, which suffered a late day sell off Wednesday and shed 81 points, opened a bit higher on the news.

However, the early advance was short-lived after the latest existing home sales disappointed and the news motivated another round of selling in morning action Thursday. The report, released 30 minutes into the trading session, showed existing home sales falling to an annual rate of 5.1 mln in August, down from 5.24 mln in July and below estimates of 5.35 mln.

]]> Thu, 24 Sep 2009 16:02:12 -0400 Frederic Ruffy Frederic Ruffy submits:

Sentiment

Stocks opened steady after suffering losses Wednesday and after the Labor Department reported that weekly jobless claims fell last week. According to the Labor Department, filings for jobless benefits fell by 21,000 to 530,000 in the week ended September 19. Economists were expecting a drop to 550,000. The Dow Jones Industrial Average, which suffered a late day sell off Wednesday and shed 81 points, opened a bit higher on the news.

However, the early advance was short-lived after the latest existing home sales disappointed and the news motivated another round of selling in morning action Thursday. The report, released 30 minutes into the trading session, showed existing home sales falling to an annual rate of 5.1 mln in August, down from 5.24 mln in July and below estimates of 5.35 mln.


Complete Story »]]> UUP GLD ERIC LEAP WYN ACN ERTS RHT COMS Frederic Ruffy Politicians Still Missing the Point About Nortel http://seekingalpha.com/article/162699-politicians-still-missing-the-point-about-nortel?source=feed 162699 It’s really interesting to see the growing amount of political huffing and puffing surrounding the demise of Nortel (NRTLQ.PK). The closer Nortel gets to extinction, the more enthusiastic that politicians get about proclaiming about how things could have been different if only better decisions had been made.

The latest example is federal Liberal leader Michael Ignatieff, who suggests he would change foreign investment rules to protect “flagship” Canadian companies such as Nortel, and how Prime Minister Stephen Harper “dropped the ball” when the government didn’t review Ericsson (ERIC) purchase of Nortel’s CDMA business and LTE R&D unit.

]]> Tue, 22 Sep 2009 04:41:44 -0400 Mark Evans Mark Evans submits:

It’s really interesting to see the growing amount of political huffing and puffing surrounding the demise of Nortel (NRTLQ.PK). The closer Nortel gets to extinction, the more enthusiastic that politicians get about proclaiming about how things could have been different if only better decisions had been made.

The latest example is federal Liberal leader Michael Ignatieff, who suggests he would change foreign investment rules to protect “flagship” Canadian companies such as Nortel, and how Prime Minister Stephen Harper “dropped the ball” when the government didn’t review Ericsson (ERIC) purchase of Nortel’s CDMA business and LTE R&D unit.


Complete Story »]]> NT NRTLQ.PK ERIC Mark Evans Asian Tech Stock Weekly Review (September 14-20, 2009) http://seekingalpha.com/article/162519-asian-tech-stock-weekly-review-september-14-20-2009?source=feed 162519 Japan

Mobile/ Wireless

• Willcom Inc. planning to ask creditor banks to allow a delay in the payment of some 100 billion yen (US$1 billion) in debts due to a decline in subscribers. In order to revive its business, Willcom will have to apply for a type of private rehabilitation which combines features of both a court-mandated liquidation and a voluntary liquidation. The company will aim to turn itself around with the help of a third-party body specializing in private rehabilitation while continuing PHS mobile services. On a net subscription basis, fresh subscriptions minus cancellations. Willcom has suffered continuous drops in contracts, registering a net subscription loss of 30,900 in August.

]]> Mon, 21 Sep 2009 09:01:09 -0400 IRG Japan

Mobile/ Wireless

• Willcom Inc. planning to ask creditor banks to allow a delay in the payment of some 100 billion yen (US$1 billion) in debts due to a decline in subscribers. In order to revive its business, Willcom will have to apply for a type of private rehabilitation which combines features of both a court-mandated liquidation and a voluntary liquidation. The company will aim to turn itself around with the help of a third-party body specializing in private rehabilitation while continuing PHS mobile services. On a net subscription basis, fresh subscriptions minus cancellations. Willcom has suffered continuous drops in contracts, registering a net subscription loss of 30,900 in August.


Complete Story »]]> DCM KDDIF.PK NELTY.PK HIT MIELY.PK SANYY.PK TMOAF.PK LGERF.PK SIGM ALBCF.PK ERIC SNDA CDCS KGDEF.PK IRG Ottawa Gives A-OK to Ericsson Deal http://seekingalpha.com/article/162242-ottawa-gives-a-ok-to-ericsson-deal?source=feed 162242 Like AAN hasbeen saying all along, the Canadian government has given its approval to Ericsson’s (ERIC) $1.3 billion purchase of Nortel’s (NT) CDMA business and its LTE R&D unit.

“There are no grounds to believe this transaction could be injurious to Canada’s national security,” Industry Canada Minister Tony Clement said. “[Ericsson] has the resources and customer base necessary to bring Canadian innovation to market…. This deal is very beneficial to Canada.”

]]> Fri, 18 Sep 2009 07:18:29 -0400 Mark Evans Mark Evans submits:

Like AAN hasbeen saying all along, the Canadian government has given its approval to Ericsson’s (ERIC) $1.3 billion purchase of Nortel’s (NT) CDMA business and its LTE R&D unit.

“There are no grounds to believe this transaction could be injurious to Canada’s national security,” Industry Canada Minister Tony Clement said. “[Ericsson] has the resources and customer base necessary to bring Canadian innovation to market…. This deal is very beneficial to Canada.”


Complete Story »]]> NT ERIC Mark Evans AT&T Increases Pace on LTE Development http://seekingalpha.com/article/161976-at-t-increases-pace-on-lte-development?source=feed 161976 On September 9, Scott McElroy, VP of Technological Realization at AT&T (T), announced HSPA would be available in six markets by the end of the year. HSPA is a software and infrastructure upgrade that doubles capacity for wireless devices from 3.6 Mb/s to 7.2 mb/s. AT&T has been adding cell sights instead of upgrading software and fiber. HSPA software upgrades require copper lines to be upgraded to fiber because the copper backhaul simply cannot carry the amount of traffic that the HSPA software can process.

An upgrade path that included HSPA+ with 21 Mb/s capacity was previously announced, but was conspicuously absent from this speech. On September 15, Kris Rinne, VP of Architecture and Planning explained why: AT&T has decided to "focus on LTE rather [than] HSPA+." In other words, AT&T is going straight to LTE for a 2011 rollout that matches the Verizon's (VZ) LTE upgrade path. This is big news for investors because the inevitable LTE buildout is going to be sooner and faster, thus more expensive than previously thought.

]]> Thu, 17 Sep 2009 07:53:09 -0400 Wisdom vs. Information Wisdom vs. Information submits:

On September 9, Scott McElroy, VP of Technological Realization at AT&T (T), announced HSPA would be available in six markets by the end of the year. HSPA is a software and infrastructure upgrade that doubles capacity for wireless devices from 3.6 Mb/s to 7.2 mb/s. AT&T has been adding cell sights instead of upgrading software and fiber. HSPA software upgrades require copper lines to be upgraded to fiber because the copper backhaul simply cannot carry the amount of traffic that the HSPA software can process.

An upgrade path that included HSPA+ with 21 Mb/s capacity was previously announced, but was conspicuously absent from this speech. On September 15, Kris Rinne, VP of Architecture and Planning explained why: AT&T has decided to "focus on LTE rather [than] HSPA+." In other words, AT&T is going straight to LTE for a 2011 rollout that matches the Verizon's (VZ) LTE upgrade path. This is big news for investors because the inevitable LTE buildout is going to be sooner and faster, thus more expensive than previously thought.


Complete Story »]]> T VZ ALU ERIC ZTCOF.PK CSCO CIEN JNPR TLAB ADCT CTV MOT FJTSY.PK HIT QLGC BRCD ELX MLNX ALTR XLNX MRVC PWAV ADTN SCMR ZHNE HSTX STAR JDSU XXIA EXFO S OCLR OPXT FNSR Wisdom vs. Information Asian Tech Stock Weekly Review (September 7-13, 2009) http://seekingalpha.com/article/161951-asian-tech-stock-weekly-review-september-7-13-2009?source=feed 161951 Japan

Hardware

• Sony Corp.’s (SNE) PlayStation 3 video game console’s weekly sales jumped to a record in Japan following the introduction of a slimmer, cheaper model. The new PlayStation 3 sold 150,252 units. Sony cut the price of the PS3 in Japan by 25 percent to 29,980 yen (US$323) with similar reductions worldwide and introduced a model that is one-third the size of the original and consumes 34 percent less power. Microsoft (MSFT) followed with a US$100 reduction for its most expensive Xbox 360 player to US$300. Nintendo (NTDOY.PK) kept the price of the Wii at US$250.

]]> Thu, 17 Sep 2009 05:17:29 -0400 IRG Japan

Hardware

• Sony Corp.’s (SNE) PlayStation 3 video game console’s weekly sales jumped to a record in Japan following the introduction of a slimmer, cheaper model. The new PlayStation 3 sold 150,252 units. Sony cut the price of the PS3 in Japan by 25 percent to 29,980 yen (US$323) with similar reductions worldwide and introduced a model that is one-third the size of the original and consumes 34 percent less power. Microsoft (MSFT) followed with a US$100 reduction for its most expensive Xbox 360 player to US$300. Nintendo (NTDOY.PK) kept the price of the Wii at US$250.


Complete Story »]]> SNE ERIC ALU SFTBF.PK DCM KDDIF.PK ATE TDK TOSBF.PK SUMCY.PK SQNXF.PK MSFT NTDOY.PK THQI SSNLF.PK NOK SNDK ALBCF.PK BIDU GOOG ZTCOF.PK LGERF.PK HRELF.PK MOT RIMM CHL TAR CHU TSL LDK IRG Wall Street Breakfast: Must-Know News http://seekingalpha.com/article/161498-wall-street-breakfast-must-know-news?source=feed 161498
  • Citigroup looks to cut U.S. stake. Sources say Citigroup (C) is working on a plan to pare the government's 34% stake in the bank, including a multibillion-dollar public stock sale followed by a buyback of some of the government's shares. Citi spoke briefly with the Treasury over the weekend, which said it has no objections as long as the bank first raises offsetting capital. Any move would give a clearer picture of how the government plans to balance its desire to wind down financial system intervention against its continued concerns over the health of the banking industry.
  • Judge blocks $33M settlement. U.S. District Court Judge Jed Rakoff told the SEC and Bank of America (BAC) their proposed $33M settlement over the lack of disclosure of $3.6B in bonuses just before BofA's merger with Merrill Lynch was "neither fair, nor reasonable, nor adequate." Judge Rakoff demanded the case be tried in court, calling their proposed consent judgement "a contrivance designed to provide the S.E.C. with the facade of enforcement and the management of the Bank with a quick resolution of an embarrassing inquiry - all at the expense of the sole alleged victims, the shareholders." (see Judge Rakoff's order (.pdf))
  • Obama says they can. Speaking to Wall Street Monday, U.S. President Barack Obama told financial leaders to expect new regulations. Potential new rules include: a new consumer financial protection agency, higher capital requirements for banks and a systemic risk regulator. Obama also said that the necessity for bailouts are waning, and that the financial sector is showing improvement. Still,the president stressed that the lessons from the past year must not be ignored.
  • Lacker says bank reforms miss mark. Richmond Fed president Jeffrey Lacker pushed back against proposed changes to financial system regulation, saying in a speech Monday that creating an apparatus for the government to 'resolve' big financial firms without forcing them into bankruptcy could weaken market discipline and lead to greater volatility. "The leading proposals before Congress concentrate almost exclusively on expanding government protection and regulation, but I believe we would be better off placing greater reliance on market-based incentives for prudent risk management," Lacker said.
  • Lilly slashes costs, jobs. Eli Lilly (LLY) announced Monday it will cut company costs up to $1B, including eliminating 5,500 jobs over the next two years. The company plans to restructure several of its business units in response to generic competition to its antipsychotic drug Zyprexa, as well as its 2008 purchase of ImClone Systems.
  • Avaya takes the call. Nortel’s corporate networking unit will be acquired by privately-owned Avaya for $915M, over Verizon's (VZ) objections. Nortel, which went into bankruptcy in January, decided selling off its main businesses was a better option for creditors than trying to reorganize. The sale follows Ericsson AB's (ERIC) purchase of Nortel's wireless business in July of this year.
  • EU wants details on GM loan. The EU Commission has asked Germany for the country's formal plan to inject €3B ($4.38B) in loan gurantees to GM's European Opel unit. Meanwhile, a meeting today between German and European government officials over state aid for the new company is unlikely to produce any results because the buyer, Magna (MGA), has yet to submit a detailed business plan. The turnaround may include cutting over 10,000 jobs.
  • So goes the year. Today marks one year following the collapse of Lehman Brothers, and risk appetite is back, with five U.S. banks recently reporting large gains from their trading desks. While some argue that recovery is clearly on the way as China's economy grows, others warn investors should not count on government bailouts for future growth.
  • Elan, J&J fix JV. Elan (ELN) dropped the value of its $1.5B deal with Johnson & Johnson (JNJ) by $115M after a ruling earlier this month that its terms violated Elan and Biogen Idec's (BIIB) partnership over their MS drug Tysabri. Under the original deal, J&J had the option of financing Elan's purchase of Biogen's stake in Tysabri under certain circumstances; the new deal eliminates this clause.
  • ING hits roadblock on government aid. Shares of ING Group (ING) fell 3.8% in Amsterdam following media reports saying European Competition authorities will reject the Dutch government's €22B guarantee of ING's U.S. Alt-A portfolio over concerns the terms may be too sweet. Analysts say ING could have to pay €1-1.7B more if the deal is rejected.
  • Genworth seeks $500M: Genworth Financial (GNW) fell in AH trading Monday after saying it's looking to raise $500M in an offering led by Goldman Sachs (GS), BofA Merrill Lynch (BAC) and Deutsche Bank (DB). Shares will be diluted as a result, but some analysts say after five consecutive quarterly losses, totaling more than $2B, it's a good sign that the company is in the position to issue at all.

Today's Markets

Overseas stocks posted modest gains Tuesday, while U.S. futures are down a drop ahead of today's retail sales data (full calendar).

  • Asia: Nikkei +0.15% to 10,218. Hang Seng -0.31% to 20,866. Shanghai +0.23% to 3,034. BSE +1.48% to 16,454.
  • Europe at midday: London +0.2%. Paris +0.3%. Frankfurt -0.1%.
  • Futures at 7:00: Dow -0.1% at 9542. S&P -0.1% to 1042. Nasdaq -0.1%.
    Crude +0.6% to $69.28. Gold flat at $1001. 30-year Tsy -0.08%.
    Euro -0.1% vs. dollar. Yen -0.5%. Pound -0.5%.

Tuesday's Economic Calendar

7:45 ICSC Retail Store Sales
8:30 Producer Price Index
8:30 Retail Sales
8:30 Empire State Mfg Survey
8:55 Redbook
10:00 Business Inventories
5:00 PM ABC Consumer Confidence Index

]]> Tue, 15 Sep 2009 07:18:38 -0400 SA Editors
  • Citigroup looks to cut U.S. stake. Sources say Citigroup (C) is working on a plan to pare the government's 34% stake in the bank, including a multibillion-dollar public stock sale followed by a buyback of some of the government's shares. Citi spoke briefly with the Treasury over the weekend, which said it has no objections as long as the bank first raises offsetting capital. Any move would give a clearer picture of how the government plans to balance its desire to wind down financial system intervention against its continued concerns over the health of the banking industry.
  • Judge blocks $33M settlement. U.S. District Court Judge Jed Rakoff told the SEC and Bank of America (BAC) their proposed $33M settlement over the lack of disclosure of $3.6B in bonuses just before BofA's merger with Merrill Lynch was "neither fair, nor reasonable, nor adequate." Judge Rakoff demanded the case be tried in court, calling their proposed consent judgement "a contrivance designed to provide the S.E.C. with the facade of enforcement and the management of the Bank with a quick resolution of an embarrassing inquiry - all at the expense of the sole alleged victims, the shareholders." (see Judge Rakoff's order (.pdf))
  • Obama says they can. Speaking to Wall Street Monday, U.S. President Barack Obama told financial leaders to expect new regulations. Potential new rules include: a new consumer financial protection agency, higher capital requirements for banks and a systemic risk regulator. Obama also said that the necessity for bailouts are waning, and that the financial sector is showing improvement. Still,the president stressed that the lessons from the past year must not be ignored.
  • Lacker says bank reforms miss mark. Richmond Fed president Jeffrey Lacker pushed back against proposed changes to financial system regulation, saying in a speech Monday that creating an apparatus for the government to 'resolve' big financial firms without forcing them into bankruptcy could weaken market discipline and lead to greater volatility. "The leading proposals before Congress concentrate almost exclusively on expanding government protection and regulation, but I believe we would be better off placing greater reliance on market-based incentives for prudent risk management," Lacker said.
  • Lilly slashes costs, jobs. Eli Lilly (LLY) announced Monday it will cut company costs up to $1B, including eliminating 5,500 jobs over the next two years. The company plans to restructure several of its business units in response to generic competition to its antipsychotic drug Zyprexa, as well as its 2008 purchase of ImClone Systems.
  • Avaya takes the call. Nortel’s corporate networking unit will be acquired by privately-owned Avaya for $915M, over Verizon's (VZ) objections. Nortel, which went into bankruptcy in January, decided selling off its main businesses was a better option for creditors than trying to reorganize. The sale follows Ericsson AB's (ERIC) purchase of Nortel's wireless business in July of this year.
  • EU wants details on GM loan. The EU Commission has asked Germany for the country's formal plan to inject €3B ($4.38B) in loan gurantees to GM's European Opel unit. Meanwhile, a meeting today between German and European government officials over state aid for the new company is unlikely to produce any results because the buyer, Magna (MGA), has yet to submit a detailed business plan. The turnaround may include cutting over 10,000 jobs.
  • So goes the year. Today marks one year following the collapse of Lehman Brothers, and risk appetite is back, with five U.S. banks recently reporting large gains from their trading desks. While some argue that recovery is clearly on the way as China's economy grows, others warn investors should not count on government bailouts for future growth.
  • Elan, J&J fix JV. Elan (ELN) dropped the value of its $1.5B deal with Johnson & Johnson (JNJ) by $115M after a ruling earlier this month that its terms violated Elan and Biogen Idec's (BIIB) partnership over their MS drug Tysabri. Under the original deal, J&J had the option of financing Elan's purchase of Biogen's stake in Tysabri under certain circumstances; the new deal eliminates this clause.
  • ING hits roadblock on government aid. Shares of ING Group (ING) fell 3.8% in Amsterdam following media reports saying European Competition authorities will reject the Dutch government's €22B guarantee of ING's U.S. Alt-A portfolio over concerns the terms may be too sweet. Analysts say ING could have to pay €1-1.7B more if the deal is rejected.
  • Genworth seeks $500M: Genworth Financial (GNW) fell in AH trading Monday after saying it's looking to raise $500M in an offering led by Goldman Sachs (GS), BofA Merrill Lynch (BAC) and Deutsche Bank (DB). Shares will be diluted as a result, but some analysts say after five consecutive quarterly losses, totaling more than $2B, it's a good sign that the company is in the position to issue at all.

Today's Markets

Overseas stocks posted modest gains Tuesday, while U.S. futures are down a drop ahead of today's retail sales data (full calendar).

  • Asia: Nikkei +0.15% to 10,218. Hang Seng -0.31% to 20,866. Shanghai +0.23% to 3,034. BSE +1.48% to 16,454.
  • Europe at midday: London +0.2%. Paris +0.3%. Frankfurt -0.1%.
  • Futures at 7:00: Dow -0.1% at 9542. S&P -0.1% to 1042. Nasdaq -0.1%.
    Crude +0.6% to $69.28. Gold flat at $1001. 30-year Tsy -0.08%.
    Euro -0.1% vs. dollar. Yen -0.5%. Pound -0.5%.

Tuesday's Economic Calendar

7:45 ICSC Retail Store Sales
8:30 Producer Price Index
8:30 Retail Sales
8:30 Empire State Mfg Survey
8:55 Redbook
10:00 Business Inventories
5:00 PM ABC Consumer Confidence Index


Complete Story »]]> DIA SPY QQQQ GLD USO C BAC LLY ERIC VZ BIIB ELN JNJ ING GNW SA Editors