BCE $41 Billion Takeover Is Officially Dead
A KPMG study, which concluded the company would likely not remain solvent after a purchase, was the main cause for the deal to be terminated. The fear was that the company's assets would possibly not be able to cover its liabilities after the deal closed.
The stock has been basically now cut in half since the news of the deal getting shaky leaked out. We had removed shares of BCE from our "Recommended" list back on Sept. 17, when the stock traded at $34.58. We would simply avoid the shares at this point, with no hope of a deal now being the case.
BCE is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.
Costco Reported Flat Profit Growth This Quarter
just reported a profit of $262.5 million, or 60 cents per share, for the fiscal first quarter ended Nov. 23, compared to $262 million, or 59 cents per share, a year earlier.
Despite consumers seeking discounted prices, warehouse clubs like Costco have not been immune during this recent downturn. Sales rose a tepid 4% to $16.04 billion. With 550 warehouses worldwide, the company's earnings were hurt by roughly 3 cents per share by the stronger U.S. dollar.
We had removed shares of COST from our "Recommended" list back on Sept. 22, when the stock traded at $66.09. The company has a dividend yield of 1.08%, based on last night's closing stock price of $53.69. Keep an eye on the recent 52-week low price range of $43-$44 a share. If this fails to hold, the company may re-test 2002 lows of $28 a share. We would look elsewhere for better investment opportunities.
Costco is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.
Procter & Gamble Trims Sales Growth for the Quarter
Procter & Gamble
is reporting that sales for the quarter will be shy of its forecast of 4% to 6%.
Management cites the change is being driven primarily by reductions in retailer, distributor and consumers' in-home inventories. Retailers have been paring inventories to avoid costly product writedowns.
The company is still expecting EPS in the quarter to be in the range of $1.58 to $1.63.
We had removed PG shares from our "Recommended" list on Oct. 6, when the stock traded at $71.08. The company has a 2.37% dividend yield, based on last night's closing stock price of $59.12. The company appears to have long-term technical support in the $50-$55 price area. We would wait to see those levels before we re-evaluate the risk/reward.
Procter & Gamble is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.
Sprint Nextel Debt Cut to 'Junk'
senior unsecured debt rating was just lowered by Moody's Investor Services to non-investment grade, also known as "junk."
Moody's sees the company in a significantly weakened market position among the national wireless carriers. It also sees Sprint facing continuing challenges in turning around its wireless operations amid intense competition and weak economic conditions.
The future of the company was decided on its ill-timed acquisition of Nextel in 2005. Value managers paraded the stock around for the last several years, only to see it fall to the $2 a share level. We would avoid shares of this telecom play here.
Sprint Nextel does not currently pay a dividend.
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.