Financial Winners & Losers: Lehman
07/03/08 - 01:13 PM EDT
Debra Borchardt
Fortress Investment Group (FIG Quote - Cramer on FIG - Stock Picks) reworked a deal with Penn National Gaming (PENN Quote - Cramer on PENN - Stock Picks) Thursday, as financial stocks ticked up slightly ahead of the holiday weekend.
Fortress and private equity firm Centerbridge Partners, which had agreed in June to buy Penn for $67 a share will now instead invest in the casino operator and pay a termination fee. Penn stock had declined 44% since last June. Fortress was trading down about 1% to $11.39; Penn was up 3% to $29.45. The NYSE Financial Sector index advanced 0.6% to 6,155.47. Employees of Lehman Brothers (LEH Quote - Cramer on LEH - Stock Picks) were happy to hear about an unexpected midyear bonus. The beaten-down brokerage decided to award it employees with a stock bonus that supposedly represents 20% of their equity compensation. It is meant to boost morale and retain employees, although with the huge amounts of layoffs in the brokerage industry that doesn't seem to be a threat. More likely, the move is meant to increase employee ownership at a time when rumors are flying that the company might be the target of a takeover. Either way, the stock climbed 2.6% to $22.93. Merrill Lynch (MER Quote - Cramer on MER - Stock Picks) managed to climb as much as 2.7% after a JP Morgan analyst said he expects the brokerage to record a loss in the second quarter. The analyst maintains a neutral rating and suggested that Merrill would probably sell its stake in Bloomberg before it would sell its stake in BlackRock (BLK Quote - Cramer on BLK - Stock Picks). Merrill ended flat at $31.13. Elsewhere, Wachovia (WB Quote - Cramer on WB - Stock Picks) dropped 3.1% to $14.90. The bank announced that it appointed Kevin O'Connor as its chief investment officer to Wachovia Global Securities Lending, a division of the bank that handles third-party lending.
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