Stocks to Watch: Charles Schwab and U.S. Trust to Merge; Tommy Hilfiger Issues Earnings Warning

Charles Schwab (SCH Quote) and U.S. Trust (UTC Quote) said they have agreed to merge, in a stock deal valued at $2.7 billion. According to the terms, U.S. Trust shareholders would get 3.427 shares of Schwab per each U.S. Trust share. The two companies said the merger would qualify as a pooling of interest for accounting treatment. Schwab said the merged company would have 1999 revenues totaling $4.5 billion and income of $663 million. In premarket activity, Charles Schwab was down at 34 from Wednesday's closing price of 37 10/16.

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Tommy Hilfiger (TOM Quote) warned investors that it expects to post third-quarter earnings of between 58 cents to 64 cents a share, greatly missing the 14-analyst estimate of 73 cents, but possibly exceeding the year-ago 61-cent profit. The company is blaming pricing pressure for the disappointing outlook.

Tommy is forecasting fourth-quarter earnings between 35 cents to 45 cents a share, also missing the 13-analyst estimate of 58 cents. In premarket activity, Tommy was down to 17 3/8 from Wednesday's closing price of 19 3/16.

Mergers, acquisitions and joint ventures

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