Air Products & Chemicals Trims Guidance, Cutting Jobs
Air Products & Chemicals
just announced it is lowering its financial outlook for the first quarter of fiscal 2009, and will be cutting 7% of its workforce.
The company said it needs to lower its cost structure and better align its businesses to reflect rapidly declining economic conditions. The company will be slashing 1,300 jobs in an effort to reduce fixed costs by about $50 million for 2009. The company said the move is expected to save the company $110 million in fiscal 2010 and beyond.
Management now sees next quarter's EPS in a range of 95 cents-$1, below its prior outlook of $1.15 to $1.21. The consensus is for $1.12.
We had removed shares of Air Products & Chemicals from our "Recommended" list back on Aug. 11, when the stock was trading at $89.92. The company has a 3.63% dividend yield, based on last night's closing stock price of $48.54. The stock does have technical support in the $40-44 price area. If this fails to hold, the next level of support is around $26. We would look for better investment opportunities at this time.
Air Products & Chemicals is not recommended at this time, holding a Dividend.com Rating of 3.1 out of 5 stars.
Constellation Energy May Rebuff Buffett
There are reports circulating that
( CEG) is leaning toward an agreement to sell one-half of its nuclear power business to Electricite de France SA.
If this does occur, then the offer for the entire company from MidAmerican Energy Holdings, a unit of Warren Buffett's
( BRKA), would go away. The deal would pay Constellation $4.5 billion for 50% of its nuclear assets and give the U.S. company the option to sell it up to $2 billion more of its non-nuclear assets to EDF.
We had removed shares of Constellation Energy from our "Recommended" list back on Aug. 1, when the stock was trading at $83.16. The market is not reacting too strongly at this point, with the shares up 2% so far. We would stay on the sidelines and avoid the shares here. There doesn't seem to be much willingness from Buffett's team to raise its bid, so we'd look elsewhere for better and clearer opportunities.
Factset Research Shares Bounce Despite Current Wall Street Turmoil
Factset Research Systems
just reported its first-quarter profit rose 21% to $35.6 million, or 73 cents per share, from $29.4 million, or 58 cents per share, during the same quarter a year earlier.
The company reported its revenue was 16% to $155.6 million from $134.2 million during the year-ago period. The company's total annual subscription value at the end of the quarter was $620 million, up 14.5% from the same time a year ago.
Management is forecasting next quarter's revenue to come in a range of $156-159 million, which is in the consensus neighborhood of $158.5 million.
We had removed shares of Factset Research Systems back on June 27, when the stock was trading at $57.61. The company has a dividend yield of 1.34%, based on last night's closing stock price of $35.70. With Wall Street firms getting hit hard, Factset will have a lot of work to do to make up for potential lost clients.
The stock has technical support in the $28 area. If that fails to hold, the next major area of technical support would be in the $16 area. The stock is reacting well so far today to the earnings report, but we would still be cautious on the stock here.
Factset Research Systems is not recommended at this time, holding a Dividend.com Rating of 3.1 out of 5 stars.
ITT Gives 2009 Outlook, Expects to Boost Dividend
is reaffirming its 2008 profit forecast and is issuing a forecast for 2009.
The maker of pumps, filters and military electronics, reiterated it is comfortable with a 2008 profit forecast of $3.97 to $4.03 per share. The company is also giving EPS guidance for 2009 of $3.60 to $4.00. Management is also putting forth a recommendation to boost its dividend to 85 cents per share for 2009, an increase of about 22% over the 2008 dividend.
We had removed shares of ITT from our "Recommended" list on Sept. 9, when the stock traded at $ 61.73. The company has a 1.65% dividend yield, based on last night's closing stock price of $42.35. We mentioned back in October that the company should boost its below-average dividend yield, and it appears the message is getting through. The stock does have some technical support in the $35 price area. If that fails to hold, then the possibility would be for the name to drift down to the $25 level. We would look elsewhere for better investment opportunities.
ITT is not recommended at this time, holding a Dividend.com Rating of 3.2 out of 5 stars.
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At the time of publication, the author had no positions in stocks mentioned, although positions may change at any time.
Tom Reese and Paul Rubillo are senior editors of Dividend.com. Visit Dividend.com for more dividend stock ratings, picks, news, and analysis for long-term and income-seeking investors.