Stocks to Watch Friday: Vivendi, King Pharmaceuticals, Altera, Novellus

By TSC Staff ,

Updated from 6:38 p.m. ET Thursday

Filing into the second-quarter confession pew last night,

Altera

(ALTR) - Get Report

lowered its revenue guidance for the second quarter, citing lower-than-expected international sales.

For the quarter ending June 30, the chip maker expects revenue to decline about 25% from the first quarter's top line of $287.4 million. Altera previously expected a sequential decline of 20%. That forecast would imply revenue of about $215.5 million for the second quarter. According to

Thomson Financial/First Call

, analysts expect the company to bring in revenue of $237.8 million for the quarter, down from $340.7 million a year ago. Wall Street is looking for earnings of 10 cents a share, compared with 25 cents in the year-ago period.

The company said North American resales to this point in the quarter are in line with prior expectations. Despite the reduced revenue outlook, Altera said inventories, at the company and its distributors, will decline in the quarter.

Shares of Altera ended

Nasdaq regular-session trading up 3.2% to $24. The company will post second-quarter results after the market closes on July 23.

Mergers, acquisitions and joint ventures

Media and communications business giant

Vivendi Universal

(V) - Get Report

said this Friday that it has agreed to acquire all the outstanding shares of Boston, Mass.-based

Houghton Mifflin

(HTN)

, a U.S. educational publisher, in a deal valued at $2.2 billion, in order to break into the U.S. publishing market.

The acquisition involves a cash tender offer for all of Houghton Mifflin's common stock at a price of $60 per share. Houghton Mifflin shareholders will receive the same price paid in the tender offer in cash once the merger is complete, Vivendi said. The acquisition, which has been approved by the boards of both companies, remains subject to regulatory approvals and to other conditions, including the tender of at least two-thirds of the Houghton Mifflin shares.

Vivendi said the acquisition, which would boost Vivendi's publishing unit to the second spot in the education field, would be accretive and result in estimated earnings before interest, taxes, depreciation and amortization, or EBITDA, of at least $75 million before the end of 2002.

After Thursday's Close

Williams Communications

(WCG) - Get Report

said it completed the sale of its Canadian business services unit to Canadian telecom-provider

Telus

.

The company, which announced the sale in March in order to focus on the growing broadband market, did not reveal the terms of the deal, but said it expects to realize about $400 million in cash over time from the sale of its entire Solutions business, excluding disposition costs.

Back to top

Earnings/revenue reports and previews

King Pharmaceuticals

(KG)

on Friday raised its earnings and revenue projections for 2002 to a range of $1.0 billion to $1.1 billion from a previous projection of $950 million to $1.05 billion, amid continued prescription and net sales growth of its branded pharmaceutical products.

The company, which raised its estimates for the second quarter and fiscal 2001 last week, also said earnings per share for 2002 are now expected in a range of $1.52 to $1.60, up from previous guidance of $1.40 to $1.48. Analysts expected King to earn $1.47 in per share in 2002 on revenue of $999.4 million, according to Thomson Financial/First Call. King said it remains comfortable with its previously announced projected ranges for estimated revenue and diluted earnings per share on a quarterly and year-end basis for 2001.

After Thursday's Close

FuelCell Energy

(FCEL) - Get Report

posted a narrower-than-expected loss in its second quarter, and in a separate release declared a 2-for-1 stock split in the form of a 100% stock dividend.

The company, which develops electrochemical technologies such as carbonate fuel cells and electrochemical engines that generate electricity without combustion, said its second-quarter loss widened to $5.1 million, or 32 cents a share, compared with a loss of $1.7 million, or 13 cents a share, in the same period last year. Analysts on average polled by Thomson Financial/First Call expected a loss of 36 cents a share.

Revenue for the quarter was $6.5 million, compared with $4.9 million in the same quarter of 2000.

Novellus

(NVLS)

maintained its prior financial guidance for the second quarter in its conference call tonight. The company, which makes semiconductor production equipment, said it still sees bookings of $220 million, revenue of $379 million and earnings of 40 cents a share, compared with 56 cents a share in the same period last year. Analysts on average expect earnings of 39 cents a share for the second quarter.

Novellus, which was downgraded early today by

UBS Warburg

analyst Byron Walker, nevertheless told Wall Street analysts that industry sales and visibility remain "very, very unclear," according to published reports.

Starbucks

(SBUX) - Get Report

said same-store sales in May rose 3% from last year, while net sales for the month grew 20% to $204 million from $171 million for the same period in fiscal 2000.

Back to top

Miscellany

After Thursday's Close

Bridgestone/Firestone

has asked the government to investigate the safety of its erstwhile business partner

Ford's

(F) - Get Report

Explorer SUV.

Bridgestone/Firestone CEO John Lampe met with Transportation Secretary Norman Mineta and presented a lengthy report to him that claims the world's best-selling sport utility vehicle has a steering problem that contributed to rollovers Ford has blamed on faulty Firestone tires.

Bridgestone/Firestone has been releasing information criticizing Ford's Explorer since last week, when Ford announced it was replacing all 13 million Firestone Wilderness AT tires on its vehicles. That move came a day after Bridgestone/Firestone announced it was ending a 96-year relationship with Ford because of the automaker's claims about Firestone tires.

Back to top

TheStreet.com

tracks tech stocks that are moving throughout the trading day with

Tech Movers.

Loading ...