This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
See Cramer's multi-million dollar portfolio for FREE and get his new book Get Rich Carefully! Learn More

Tuesday's Winners & Losers: Transmeta, Donnelly, Pets.com, Versatel

Jump to Sections Below
  • M&A
  • Earnings/revenue
  • Analyst actions
  • Offerings/stock actions
  • Miscellany
  • Updated from 2:04 p.m.

    Analysts were talking about Cisco (CSCO) after the company released third-quarter earnings that beat expectations and subsequently raised projections for the 12th straight quarter.

    • Lehman Brothers raised its 12-month price target to $65 from $63 and raised its 2001 earnings per share view to 78 cents from 74 cents.

    • Credit Suisse First Boston raised its price target to $87 from $85 and its 2001 earnings call to 78 cents a share from 74 cents.

    • Merrill Lynch raised its price target to $85 and its 2001 earnings call to 79 cents a share from 75 cents a share.

    For more on Cisco's earnings picture, check out TheStreet.com's extended coverage. Cisco closed up, though, after wreaking havoc on the semiconductor sector, higher by $1.63, or 2.95%, to $56.75.


    Online pet supply store Pets.com (IPET) announced that it is closing its doors because of an inability to find either a buyer or a financial backer.

    "With no better offers, and avenues effectively exhausted, we felt that the best option was an orderly wind-down, with the objective to try to return something back to the shareholders," the statement said.

    Pets.com said that it would sell the majority of its assets, including its inventory and its warehouse equipment, and lay off 255 of its 320 employees. Pets.com closed down 44 cents, or 66.7%, to 22 cents.

    Mergers, acquisitions and joint ventures

    Massive Latin-American utility holding company Enersis (ENI) has gone shopping, offering $430 million for all the outstanding shares in two Chilean power companies, Chilectra and Rio Maipo. Enersis is controlled by Endesa, the Spanish power giant, and this move is yet another attempt for the company to expand its Latin-American holdings, adding Chile to a list that already includes Argentina, Brazil, Colombia and Peru. Enersis closed down 25 cents, or 1.3%, to $18.50.

    Forget about the Joneses. Keep up with the Johnsons.

    Johnson Control (JCI), which makes car-seating systems, snapped up 1.5 million outstanding shares, or 15%, of Donnelly (DON), which also provides auto parts.

    The move comes at a particularly good time for Donnelly. In August, Heartland Advisors, which has a stake in Donnelly, said the company was undervalued and it would consider selling off the business if things didn't improve. Since that time, Donnelly's shares have hit a 52-week high and a subsequent 52-week low. And lately, Donnelly's been at the low.

    Johnson closed down 6 cents, or 0.1%, to $58.44; Donnelly was up $1.30, or 10.9%, to $13.25.

    Dutch data communications company Versatel (VRSA) said that it expects additional funds to become available for its Versapoint joint venture, which is outfitting Europe with DSL high-speed Internet access. Versatel closed down $2.25, or 11.3%, to $17.75.

    Back to top

    Earnings/revenue reports and previews

    AXA Financial (AXF) released third-quarter earnings of 55 cents a share, better than the year-ago 38 cents and the 50 cent First Call/Thomson Financial estimate. AXA closed up 44 cents, or 0.8%, to $55.63.

    When oil prices skyrocketed, so did the fortunes of BP Amoco (BP). Today, the company announced that third-quarter earnings grew in line with expectations, hitting $3.8 billion from $1.96 billion, representing growth of 48%. The company also decided to share the wealth, raising its quarterly dividend to 5.25 cents a share from 5 cents a share. BP Amoco ended the day up 19 cents, or 0.4%, to $49.25.

    ECI Telecom (ECIL) announced third-quarter earnings of 16 cents a share, lower than the four-analyst 18 cent estimate and the year-ago 61 cent profit. ECI closed down 50 cents, or 2.1%, to $23.38.

    Emerson Electric (EMR) posted fourth-quarter earnings of 86 cents a share, in line with the 10-analyst estimate and up from year-ago earnings of 78 cents a share.

    The company said its first-quarter earnings growth is expected to be in line with the second half of 2000. The five-analyst estimate for first-quarter net income is 83 cents a share. For 2000's third quarter, the company posted earnings of 87 cents a share vs. 75 cents a share in the previous fiscal year's first quarter.

    The company said the recent strengthening of its process business appears to be a sustainable and it is "optimistic that 2001 will be another solid growth year for Emerson."

    Emerson increased its quarterly dividend from 35.75 cents to 38.25 cents. The company's stock closed down $1.94, or 2.7%, to $70.69.

    Expeditors International of Washington (EXPD) posted third-quarter earnings of 47 cents a share, in line with the 12-analyst estimate and up from year-ago earnings of 33 cents a share. Expeditors closed up 36 cents, or 0.7%, to $55.73.

    International Game Technology (IGT) announced fourth-quarter earnings of 70 cents a share, better than the 63 cent analyst estimate and the year-ago loss of 45 cents. IGT closed up $1.31, or 3.5%, to $38.56.

    Millennium Chemicals (MCH) posted third-quarter earnings of 55 cents a share, beating the nine-analyst estimate of 44 cents and up from year-ago earnings of 23 cents. Millennium closed up 19 cents, or 1.2%, to $15.81.

    OfficeMax (OMX) announced third-quarter losses of 10 cents a share, in line with what analysts expected, but well short of year-ago profitability. Last year at this time, the company had earnings of 14 cents a share. Lower-than-expected sales coupled with higher-than-expected costs were cited as major factors behind the loss. Well, duh. OfficeMax closed flat at $2.88.

    Teva Pharmaceuticals (TEVA), an Israeli drug company, announced third-quarter earnings of 36 cents a share, better than the First Call/Thomson Financial estimate of 34 cents. One year ago in the same quarter, Teva made 15 cents a share. Excluding charges and expenses related to research and development in two companies recently acquired by Teva, the company earned 29 cents a share. Teva closed up $4.75, or 7.6%, to $67.44.


    After Monday's Close

    Adobe (ADBE) said it was increasing its target for operating margins by 1 percentage point for fiscal year 2001, to 32% from 31%, reflecting a decrease in revenues and spending. Adobe closed down $1, or 1.2%, to $82.25.

    Jack In The Box (JBX) reported fiscal fourth-quarter earnings of 51 cents a share, in line with the First Call/Thomson Financial consensus. The company earned 47 cents a share at this time last year. The stock closed up 6 cents, or 0.3%, to $25.56.

    PartnerRe (PRE) reported earnings of $1.06 a share, in line with the 11-broker estimate. The company earned 79 cents a share at this time a year ago. PartnerRe closed up $2.69, or 5.1%, to $55.38.

    XL Capital (XL) reported earnings of $1.10 a share, in line with the 13-broker estimate. XL closed up $1.44, or 1.9%, to $76.19.

    Back to top

    Analyst actions

    Upgrades

    Abgenix (ABGX): UP to accumulate from hold at Prudential Securities. Abgenix ended the day up $2.13, or 2.3%, to $93.19.

    Allied Waste (AW): UP to strong buy from buy at Deutsche Banc Alex. Brown. Allied Waste closed up $1.31, or 13.6%, to $11.

    Amerada Hess (AHC): UP at Merrill Lynch: 2001 earnings per share to $8.85 from $8.60. Amerada Hess closed up $1, or 1.7%, to $61.38.

    Waste Management (WMI): UP to strong buy from buy at Alex. Brown. The stock ended the day up $1.44, or 6.7%, to $23.06.

    Downgrades

    Hibernia (HIB): DOWN to outperform from buy at Lehman Brothers; price target: $13 from $15. The bank's stock closed up 13 cents, or 1.1%, to $12.06.

    Infonet (IN): DOWN to accumulate from buy at Merrill Lynch. Infonet ended the day up 25 cents, or 4.1%, to $6.38.

    Initiations

    Homestore (HOMS): NEW buy at Credit Suisse First Boston. Homestore closed down 88 cents, or 2.2%, to $38.13.

    ResMed (RMD): NEW buy at Merrill Lynch. ResMed closed down 13 cents, or 0.4%, to $32.50.

    Group Moves

    Credit Suisse First Boston initiated coverage of the lodging industry:

    • Extended Stay America (ESA) NEW hold, price target $15. ESA ended the day down 13 cents, or 0.98%, to $12.63.

    • Hilton Hotels (HLT) NEW buy, price target $12. Hilton closed down 6 cents, or 0.7%, to $9.06.

    • Marriott International (MAR) NEW buy, price target $50. Marriott closed down 19 cents, or 0.5%, to $39.38.

    • Starwood Hotels and Resorts (HOT) NEW strong buy, price target $24. The stock closed up $1, or 3.3%, to $31.31.

    Back to top

    Offerings and stock actions


    After Monday's Close

    Burst Media, an online advertising firm, withdrew its proposed $50 million initial public offering yesterday, citing the current market environment, which doesn't want to have anything to do with advertising-related dot-com issues. The company had applied for a Nasdaq nasdaq listing under the symbol BRSM.

    Curtiss-Wright (CW) approved a stockholder rights plan and approved a special 25 cent a share cash dividend. Curtiss-Wright closed down 94 cents, or 1.9%, to $49.81.

    Transmeta (TMTA) priced its 13 million share initial public offering at $21 a share. Transmeta closed up $24.25, or 115.4%, to $45.25.

    Back to top

    Miscellany

    Bank One (ONE) announced that Philip Heasley will take over as chairman and chief executive of its First USA credit card division. Bank One closed down $1.19, or 3.2%, to $36.31.

    Guidant (GDT), a medical device manufacturer, announced that it has received clearance to market its Multi-Link Pixel coronary stent system in most European countries. Guidant closed down $1.50, or 2.7%, to $55.

    Communications networker Level 3 Communications (LVLT) hit $132.25 on March 10, nailing down a record high and, unfortunately, a peak that it has not since come close to seeing again. Yesterday, the company closed at $35, some 74% down from that March peak. Investors have grown skittish about the falling stock price, despite the fact Level 3's earnings, released Oct. 18, were 22 cents better than expectations with a loss of $1.02 a share. It's just that some things in the report left major revenue questions unanswered. James Crowe, Level 3's chief executive, tried to ease concerns this morning in an open letter to Level 3's shareholders.

    "I assure you that we are not happy about current stock performance," he wrote, before tackling a far stickier spending situation.

    You see, investors are concerned that the company's capital spending increased to $6.3 billion in fiscal 2000 without parallel increases in investment in the company or 2001 revenue projections. In essence, people are concerned, especially given the volatile nature of the telecommunications industry, about the amount of money being spent by Level 3 is more than the amount coming in. So what's the deal?

    "My answer is that we remain confident in our ability to earn a superior return on out-invested capital," Crowe wrote. "The reason we have not updated 2001 revenue projections is not concern over 2001 performance, it is our longstanding commitment to provide the best, most thoughtful guidance we can." Level 3 closed up $3, or 8.6%, to $38.

    Let's talk turkey. On second thought, let's not.

    Sara Lee (SLE)>, America's cheesecake sweetheart, won't be making any new British friends after the company backed out of talks to purchase U.K. turkey producer Bernard Matthews, which took a big hit on the news.

    There's been a lot of gobbling going on at the turkey maker lately. Two weeks ago, Bernard Matthews, the person for which the company is named, made an offer for the entire company in an effort to take it private. This offer failed to pass muster, and smelling a bargain; Sara Lee stepped in and tendered an offer of its own, which was then rejected by the Matthews family, who owns 42% of the company. The stock ended the day down 6 cents, or 0.3%, to $21.50.


    After Monday's Close

    Dynegy (DYN) said it expects to report earnings of $1.65 to $1.75 for 2001. Dynegy closed up $1.38, or 2.7%, to $52.63.

    IMRS (IMRS) named Michael Dean CFO. The stock closed up 81 cents, or 9.9%, to $9.

    Philip Morris (MO) said it will post a $100 million bond required to stay the execution of the judgment against the company in the Engle class-action lawsuit. The company, along with other tobacco companies, is appealing the case, which ordered Big Tobacco to pay $145 billion in punitive damages to a group of smokers. The company's stock closed up 38 cents, or 1.1%, to $35.25.

    Polo Ralph Lauren (RL) named Gerald Chaney senior vice president and CFO. Chaney will report to COO and President Roger Farah. Polo closed down 6 cents, or 0.3%, to $22.56.

    Walter Industries (WLT) named Don DeFosset president and CEO, replacing Donald Boyce, who had served as interim chairman, president and CEO. DeFosset was most recently COO at Dura Automotive Systems (DRRA). Walter ended the day up 13 cents, or 1.7%, to $7.50.

    Back to top

    Select the service that is right for you!

    COMPARE ALL SERVICES
    Action Alerts PLUS
    Try it NOW

    Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

    Product Features:
    • $2.5+ million portfolio
    • Large-cap and dividend focus
    • Intraday trade alerts from Cramer
    • Weekly roundups
    TheStreet Quant Ratings
    Try it NOW
    Only $49.95/yr

    Access the tool that DOMINATES the Russell 2000 and the S&P 500.

    Product Features:
    • Buy, hold, or sell recommendations for over 4,300 stocks
    • Unlimited research reports on your favorite stocks
    • A custom stock screener
    • Upgrade/downgrade alerts
    Stocks Under $10
    Try it NOW

    David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

    Product Features:
    • Model portfolio
    • Stocks trading below $10
    • Intraday trade alerts
    • Weekly roundups
    Dividend Stock Advisor
    Try it NOW

    Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

    Product Features:
    • Diversified model portfolio of dividend stocks
    • Alerts when market news affect the portfolio
    • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
    Real Money Pro
    Try it NOW

    All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

    Product Features:
    • Real Money + Doug Kass Plus 15 more Wall Street Pros
    • Intraday commentary & news
    • Ultra-actionable trading ideas
    Options Profits
    Try it NOW

    Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

    Product Features:
    • 100+ monthly options trading ideas
    • Actionable options commentary & news
    • Real-time trading community
    • Options TV
    To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
    DOW 16,501.65 0.00 0.00%
    S&P 500 1,878.61 +3.22 0.17%
    NASDAQ 4,148.3380 +21.3710 0.52%

    Brokerage Partners

    Rates from Bankrate.com

    • Mortgage
    • Credit Cards
    • Auto
    Advertising Partners

    Free Newsletters from TheStreet

    My Subscriptions:

    After the Bell

    Before the Bell

    Booyah! Newsletter

    Midday Bell

    TheStreet Top 10 Stories

    Winners & Losers

    Register for Newsletters
    Top Rated Stocks Top Rated Funds Top Rated ETFs