Ticker-Tape Parade: Washington Mutual to Buy Dime, Compaq Restructures
(Updated from 8:23 a.m. EDT)
Compaq Computer
(CPQ)
, beleaguered by a price war with rivals
Gateway
(GTW)
and
Dell
(DELL) - Get Report
, will be pushing into the services business instead of focusing solely on the mainstay PC business, according to a story in this morning's
Wall Street Journal
. Company CEO Michael Capellas outlined the necessary steps and changes in a memo to employees, saying the company will be cutting more costs and making a few more acquisitions to help it move out of the PC-centric world and into a more software- and service-oriented space.
IBM
(IBM) - Get Report
made a similar change a few years back. Capellas said he'd like to increase the services part of Compaq's business from 20% of revenues to 33%.
Earnings Reports & Warnings:
Acxiom
(ACXM)
warned that first-quarter EPS will miss the 5-cent analysts' consensus estimate and come in with a loss of 6 cents to 9 cents a share. The company blamed slowing spending from customers for the miss.
Lufkin Industries
(LUFK)
said second-quarter and full-year EPS would come in higher than earlier guidance, with second-quarter EPS between 68 cents and 75 cents, better than the 48 cents to 55 cents previously expected. The company had earnings of 33 cents in the year-ago period, while analysts expect a bottom line of 52 cents.
Paychex
(PAYX) - Get Report
announced fourth-quarter EPS of 18 cents, in line with estimates and better than the year-ago 14 cents.
Walgreen
(WAG)
announced third-quarter EPS of 21 cents, missing the 22-cent expectation. The year-ago quarter EPS was 19 cents.
Mergers & Acquisitions:
Anadarko Petroleum
(APC) - Get Report
said it woud acquire
Gulfstream Resources Canada
for $136.8 million.
First Banks America
(FBA)
announced a deal to buy competitor
BYL Bancorp
(BOYL)
for $52 million in cash, or $18.50 a share, which is 23% higher than BYL's closing price Friday of $15 a share.
Sanmina
(SANM) - Get Report
disclosed plans to purchase
Alcatel's
(ALA)
Richardson, Texas, manufacturing operations for an undisclosed sum.
Titan
(TTN)
announced it would buy
Datron Systems
(DTSI)
in a stock swap worth $51.2 million.
Washington Mutual
(WM) - Get Report
is buying New York-based
Dime Bancorp
(DME)
for $5.2 billion in stock and cash. The final deal was announced this morning.
On the Analyst Front:
Arch Coal
(ACI) - Get Report
was upgraded to strong buy from buy at
Lehman Brothers
, which said the company was "an attractive takeover target for global mining conglomerates."
Coca-Cola
(KO) - Get Report
was upgraded to the U.S. recommended for purchase list from market outperform at
Goldman Sachs
, which said the low 40s would be a good entry point for investors. The company ended Friday's session at $42.85.
Miscellaneous News:
AMR
(AMR)
, parent of
American Airlines
, reached a 3-year contract with the
Transport Workers Union
, which represents 15,000 of AMR's maintenance and support personnel.
Ariad Pharmaceuticals
(ARIA)
filed with the
Securities and Exchange Commission
to sell up to 4.5 million shares.
Delta Air Lines
(DAL) - Get Report
signed a tentative labor agreement with its Comair unit, ending a 13-week-old pilots' strike. More than 1,350 Comair pilots will return to work, having been out since voting to strike on March 26.
Electronic Arts
(ERTS)
announced CFO Stan McKee will retire in March of 2002.
Swift Transportation
(SWFT)
priced its 1.2 million share offering at $16 a share, netting $19.2 million.
Talx
(TALX)
filed papers with the SEC to sell an offering of 2.74 million common shares.
Williams
(WMB) - Get Report
filed with the SEC to sell up to $1.9 billion in debt and stock securities.
Today's Earnings:
Emerson Radio
(MSN) - Get Report
announcing fourth-quarter earnings vs. the year-ago 2 cents. There is no consensus estimate on the company. After the bell.
Sonic
(SONC)
third-quarter EPS expected at 40 cents vs. year-ago 33 cents. After the bell.
Doug Kass' Required Reading:
Peggy Noonan's editorial in
The Wall Street Journal
called, "
A Chat in the Oval Office." (Subscription required.)
In Overnight Activity:
Zions Bancorp
(ZION) - Get Report
dropped slightly after announcing on Thursday that its CFO had been arrested for drug charges. The stock joined the
S&P 500
after the close of trading on Friday.
Oracle
(ORCL) - Get Report
,
Cisco
(CSCO) - Get Report
and
Microsoft
(MSFT) - Get Report
all traded higher without fresh news.
For an extended take on late-night action, be sure to take a gander at
The Night Watch.
Sources & Definitions:
All analyst EPS estimates are from Thomson Financial/First Call, unless otherwise noted. All economic forecasts are from
Reuters
, unless otherwise noted. All times are Eastern. After-hours quotes courtesy of Instinet, unless otherwise noted.