Company Report: Intel Helps Lead Charge Ahead of Big Earnings Day
(Earnings estimates from First Call/Thomson Financial; earnings reported on a diluted basis unless otherwise specified. New highs and lows on a closing basis unless otherwise specified.)
Tech giants including
Intel
(INTC) - Get Intel Corporation Report
and
Hewlett-Packard
(HWP)
led the
Dow Jones Industrial Average's
276-point bounce. Intel flew 12 1/2, or 11.3%, to 123, while Hewlett-Packard hopped 10 3/4, or 8.7%, to 133 3/4.
Intel is among the many major stocks scheduled to report earnings in tomorrow's "Super Tuesday" flood, along with such standouts as
America Online
(AOL)
,
IBM
(IBM) - Get International Business Machines Corporation Report
TheStreet Recommends
and
Qualcomm
(QCOM) - Get Qualcomm Inc Report
.
Financial stocks were finally able to shake off some earlier pressure, helped along by strong earnings reports and the market's midday rally.
Citigroup
(C) - Get Citigroup Inc. Report
climbed 1 1/4 to 59 1/4 after it posted first-quarter earnings of $1.04 a share, which included $12 million of accelerated depreciation. The results compare to the year-ago 68-cent profit, which included a credit reversal of prior charges and beat the 18-analyst estimate of 78 cents a share.
Merrill Lynch
(MER)
inched up 1/4 to 90 1/4 after it also blew out first-quarter earnings expectations, posting a $2.38 profit, which beat out the 10-analyst estimate of $1.83 a share. The report is up from the year-ago $1.44 profit.
The
Philadelphia Stock Exchange/KBW Bank Index
rose 1.8%, while the
American Stock Exchange Broker/Dealer Index
edged up 0.6%.
Mergers, acquisitions and joint ventures
MyPoints.com
(MYPT)
fell 1 7/16, or 9.6%, to 13 1/2 after it agreed to purchase
CyberGold
(CGLD)
in a stock deal valued at $157 million. Cybergold inched up 3/16 to 5 11/16. The terms call for MyPoints to exchange 0.48 of a share of its stock for each share of CyberGold. MyPoints said the deal would be immediately add to its earnings and revenue.
First United
(UNTD)
leapt 3 1/8, or 24.8%, to 15 3/4 after
BancorpSouth
(BXS) - Get BancorpSouth Bank Report
agreed to buy it for $455 million. BancorpSouth said the deal, which would result in charges of $20 million, would be completed in the third-quarter and would be accretive as of fiscal 2001. The acquirer slipped 1/4 to 15 3/4.
Northrop Grumman
(NOC) - Get Northrop Grumman Corporation Report
popped 4 3/8, or 7.4%, to 63 13/16 after it said it is exploring options for its commercial jet parts unit, and has held talks with parties interested in this business. Earlier,
The Wall Street Journal
reported that Northrop had held advanced talks with
Carlyle Group
on a possible sale of Northrop's aerospace manufacturer's commercial-jet parts division. Credit Suisse First Boston raised its rating on Northrop Grumman to strong buy from buy.
Raytheon
(RTN.B)
said it has entered a deal valued at more than $800 million to sell its engineering and heavy-construction division to
Morrison Knudsen
(MK)
, which would result in a first-quarter charge,
The Wall Street Journal
reported. Morrison Knudsen jumped 5/8, or 7.9%, to 8 1/2, while Raytheon added 3/16 to 20 1/16.
Safeway
(SWY)
slipped 7/8 to 44 1/16 after it said it will invest $30 million in Dallas-based grocery e-business
GroceryWorks.com
. Under terms of the agreement, GroceryWorks will become Safeway's exclusive online grocery channel.
Six tire and rubber companies have agreed to set up an e-commerce market place exchange called
Rubbernetwork.com
. The companies involved in the deal include
Goodyear
(GT) - Get Goodyear Tire & Rubber Company Report
,
Michelin
and
Cooper Tire
(CTB) - Get Cooper Tire & Rubber Company Report
as well as Paris-based
Michelin
, Milan-based
Pirelli
, Tokyo-based
Sumitomo Rubber
, and Germany-based
Continental AG
. Goodyear gained 1 1/16 to 28 5/8 and Cooper Tire climbed 1/4 to 13 15/16.
Earnings/revenue reports and previews
Travelers Property Casualty
(TAP) - Get Molson Coors Beverage Company Class B Report
reported first-quarter earnings of 96 cents a share, beating the nine-analyst estimate of 87 cents and up from the year-ago 83-cent profit. Travelers was unchanged at 41 3/4.
Grain-processing giant
Archer Daniels Midland
(ADM) - Get Archer-Daniels-Midland Company Report
added 3/16 to 10 9/16 after it reported third-quarter earnings per share of 17 cents, right in line with the eight-analyst estimate but far above the year-ago figure of 2 cents. In early April,
Moody's
lowered its debt ratings on the company, saying it had been hurt by a long-term downturn in several commodity markets. The agency said the midterm outlook for Archer-Daniels was stable, however, and that the very long-term outlook was positive for ADM's staple food business.
Fiber optics manufacturer
Corning
(GLW) - Get Corning Inc Report
gained 4 1/2 to 148 1/2 after it said it will take a $35 million charge in the first quarter to record its investment in
Pittsburgh Corning
, which filed for Chapter 11 bankruptcy.
Eastman Kodak
(EK)
inched up 5/16 to 61 13/16 after it reported first-quarter earnings of 95 cents a share, beating the 13-analyst estimate of a 93-cent profit and up from the year-ago 80 cents a share.
Ford
(F) - Get Ford Motor Company Report
jumped 4 13/16, or 9.2%, to 57 1/16 after it reported first-quarter earnings of $1.70 a share, edging out the 14-analyst estimate of a $1.58 profit and up from the year-ago $1.60 a share, which included a gain.
Eli Lilly
(LLY) - Get Eli Lilly and Company Report
lifted 2 9/16 to 70 after it posted first-quarter earnings of 77 cents a share, which included a gain and sale. The report compares with a year-ago 53-cent profit and edges out the 20-analyst estimate of 61 cents.
- Alcan inched up 1/8 to 33 7/8.
- W.W. Grainger gained 1 1/8 to 46 3/8.
- New Century Energies slipped 11/16 to 31 11/16.
- Temple-Inland slipped 1/16 to 46 3/4.
- Tower Automotive lost 1/16 to 16 1/4.
- Briggs Stratton fell 2 9/16, or 6.5%, to 36 11/16.
- U.S. Bancorp slipped 5/16 to 21.
Bank of America rose 3/8 to 50 5/16.
Charles Schwab climbed 2 1/2, or 6.2%, to 43.
Offerings and stock actions
Cell Therapeutics
(CITC)
lost 7/16 to 32 1/2 after it said it is withdrawing plans for a 3 million-share secondary offering, blaming market volatility.
Dutch
KPN Telecom
(KPN)
rose 4 1/8 to 105 after it said that the books would be open for subscriptions for its KPN Mobile IPO starting May 2, if market conditions permit. The offering is forecasted to bring in between $7.7 billion to $9.6 billion. The shares will be listed in Amsterdam and Frankfurt.
Credit Suisse First Boston
said
Yupi.com
(YUPI)
has pushed back its plans for a 7 million-share IPO due to the recent market volatility.
Analyst actions
This morning,
ABN Amro
upgraded
Intel
(INTC) - Get Intel Corporation Report
to buy from outperform, just a few days after boosting the stock's rating from hold. Intel gained 12 1/2, or 11.3%, to 123.
Aclara
(ACLA)
: NEW strong buy at
Deutsche Banc Alex. Brown
; price target: 48. Aclara declined 1 1/2, or 6%, to 23 1/2.
AmeriCredit
(ACF)
: NEW market outperform at Goldman Sachs. AmeriCredit added 13/16, or 5.1%, to 16 11/16.
Blaze Software
(BLZE)
: NEW buy at
Chase H&Q
. Blaze Software stumbled 1 3/16, or 7.7%, to 14 1/16.
Brooks Automation
(BRKS) - Get Brooks Automation, Inc. Report
: UP to strong buy from buy at
Credit Suisse First Boston
. Brooks Automation lifted 6 7/8, or 11%, to 69 1/4.
Compaq
(CPQ)
: UP to strong buy from buy with a 12-month price target of 35 by
Robertson Stephens
analyst Dan Niles. Niles explained that weaker-than-expected first-quarter revenue was offset by better margins, with demand increasing between January and March. Compaq bounced 2 3/8, or 9.6%, to 26 7/8.
Digital Impact
(DIGI)
: UP to strong buy from buy at Credit Suisse First Boston. Digital Impact added 1 1/2, or 16.4%, to 10 5/8.
ePlus
(PLUS) - Get ePlus inc. Report
: NEW buy at
J.P. Morgan
; 12-month price target: 60. ePlus mounted 1 5/16, or 6.9%, to 20 5/16.
Fuel Cell Energy
(FCL)
: NEW buy at
Merrill Lynch
. Fuel Cell Energy advanced 1 7/8, or 5.4%, to 36.
Golden West
(GDW)
: NEW buy at
J.P. Morgan
; 12-month price target: 35. Golden West gained 1 7/16 to 32.
J.B. Hunt Transportation
(JBHT) - Get J.B. Hunt Transport Services, Inc. Report
: UP to buy from accumulate at
Merrill Lynch
. J.B. Hunt lifted 1 1/16, or 7.4%, to 15 1/4.
Johnson & Johnson
(JNJ) - Get Johnson & Johnson Report
: UP to buy from attractive at
Bear Stearns
; value list at
Donaldson Lufkin & Jenrette
. Johnson & Johnson added 4 7/16, or 6%, to 77 3/4.
Credit Suisse First Boston upped its rating on
Litton Industries
(LIT) - Get Global X Lithium & Battery Tech ETF Report
and
Alliant Techsystems
(ATK)
to strong buys from buys. Litton Industries gained 3/8 to 39 3/16 and Alliant Techsystems shot up 13/16 to 61 1/2.
Micron Technology
(MU) - Get Micron Technology, Inc. Report
: fiscal 2000 earnings estimate UP to $3.43 a share from $3.20 at
Goldman Sachs
; fiscal 2001 earnings estimate UP to $5.75 from $5.25. Micron Technology jumped 16 15/16, or 17.6%, to 113.
National City
(NCC)
: 2000 earnings estimate DOWN to $2.20 from $2.30 at Goldman Sachs. National City slid 1/8 to 18 3/16.
Pharmacia
(PHA)
: UP to top pick from buy at ABN Amro. Pharmacia bounced 1 to 54 1/8.
Quest Diagnostics
(DGX) - Get Quest Diagnostics Incorporated Report
: price target UP to 60 from 50 at
Warburg Dillon Read
. Quest jumped 5 3/4, or 12.9%, to 50 1/4.
Texas Instruments
(TXN) - Get Texas Instruments Incorporated Report
: UP to buy from outperform at ABN Amro. Texas Instruments jumped 24 7/8, or 18.9%, to 156 1/2.
Miscellany
Abby Joseph Cohen
, the bullish
Goldman Sachs
strategist, said she is not changing her
S&P 500
price targets of 1575 for year-end and 1625 for spring 2001, nor her fundamental market view. Cohen recently lowered her equity allocation and backed off an overweight position in tech.
Cohen also said that her year-end forecast for
Dow Jones Industrials
is 12,600. The influential analyst explained in a research note that the price targets remained unchanged after a review of corporate earnings, inflation and interest rate trends, for which outlook remains stable.
Conseco
(CNC) - Get Centene Corporation Report
put $11.9 million on reserve to possibly pay back defaults by company executives for their $575.8 million share in bank loans that the company secured in a controversial stock purchasing program,
The Wall Street Journal
reported. Conseco slipped 13/16, or 10.7%, to 6 3/4.
IBM's
(IBM) - Get International Business Machines Corporation Report
new cash balance plan, which has already been reduced as a result of worker disapproval, is facing scrutiny as shareholders urge the company to ax the program,
The Wall Street Journal
reported. IBM popped 6 7/8, or 6.6%, to 111 7/8.
InterDigital Communications
(IDC)
lost 1 13/16, or 12.2%, to 13 after it said Mark Gercenstein was named CEO and appointed to the company's board. Gercenstein was most recently at
Motorola
(MOT)
.
Beleagered shopping center developer
JDN Realty
(JDN)
lost 11/16, or 7.3%, to 8 11/16 after it announced that its bank funding agreements expired Friday when it was unable to extend them to provide further funding. Under those arrangements, the bank groups had provided JDN Realty access to credit on an unsecured basis. JDN stated that it would continue to discuss an extension of the funding agreements or an amendment to the existing credit contracts. The company also said it is in the process of soliciting a financial adviser for advice on alternative means for financing its business.
Lehman Brothers
(LEH)
lifted 2 3/4 to 78 3/8 after it named David Goldfarb as chief financial officer. James Rosenthal has been selected to head up the investment bank's e-commerce division.
Wachovia
gained 1 1/8 to 64 7/8 after it said it agreed to settle a lawsuit involving
South Carolina National Bank
and said it sees a one-time charge of $20 million in the first quarter as a result.
