Molex Cuts Outlook on Lower Demand Molex ( MOLX), manufacturer and seller of electronic components worldwide, cut its first-quarter outlook -- citing lower demand in its telecom, data infrastructure and automotive markets. Management says the industrial and consumer electronic markets are below the company's original outlook -- as customers remain cautious in their procurement and forecasting -- given the significant uncertainty in the global economy. For the first quarter, Molex sees earnings of 25 cents to 29 cents a share -- below Reuters consensus estimates of 38 cents a share. We have avoided the shares since our early June coverage began, when Molex shares were trading in the $27-$28 range. We recommend looking elsewhere for better investment opportunities. The company has a 2.75% dividend yield, based on last night's closing stock price of $22.19. Molex is not a recommended dividend stock at this time, holding a Dividend.com Rating of 3.2 out of 5 stars. Eli Lilly Reportedly Offering $70 per Share for ImClone According to various news reports, Eli Lilly ( LLY - Get Report) is in advanced talks to acquire ImClone Systems ( IMCL) for $70 per share in cash in a $6.1 billion deal. Eli Lilly's offer significantly trumps the latest offer from Bristol Myers ( BMY - Get Report) of $62 per share. Bristol Myers already owns a 17% stake in ImClone Systems. Eli Lilly is looking to add to its current slate of Oncology products -- which presently include Alimta and Gemzar. ImClone's cancer treatment Erbitux -- which is used to combat colorectal, head and neck, and lung cancers -- had sales of about $1.3 billion in 2007.
We presently have Bristol Myers on our "Recommended" list -- but recently removed Eli Lilly from the list back on Sept. 29 -- when shares were trading at $46.82. We will be watching the market's reaction to the deal very closely. We may have to re-evaluate our ratings if we believe this potential deal changes the pharma landscape. Eli Lilly is not a recommended dividend stock at this time, holding a Dividend.com Rating of 3.4 out of 5 stars. Mosaic Shares Plunge on Big Earnings Miss Fertilizer producer Mosaic ( MOS - Get Report) is down nearly 30% after the company came in with Earnings Per Share of 29 cents -- missing estimates. The company warned it plans to sharply reduce phosphate production over the next several months -- due to high inventory levels. Despite the earnings miss, the company contends that global potash market conditions continue to remain tight -- due to healthy demand and low inventory levels. We cautioned investors back in the first week of August that the momentum money appeared to be packing up their profits and exiting the fertilizer sector. We were on time with that call -- similar to our Coal and Steel calls at the end of the summer. It's always tough to leave a sector that had been a huge winner -- but the profits were there to be taken. Remember, it's always better to leave the party a little early than risk being left behind in the middle of a potential mess. Mosaic is not a recommended dividend stock at this time, holding a Dividend.com Rating of 2.5 out of 5 stars.
Marriot Reduces 2009 Earnings Forecast Marriott Hotels ( MAR - Get Report) just reported its third-quarter profit fell 28% as its hotel and time-share businesses slowed. Management said its timeshare business has certainly been far more impacted by the current financial environment than its core lodging business. Third quarter profit fell 28% over the same period last year -- while the company's net income grew by just 1%. The company is also cutting its fourth quarter outlook to a range of 44 cents to 50 cents a share, below Reuters analysts' estimates of 62 cents. Some of Marriot's other hotel brands include Courtyard, Ritz-Carlton and Fairfield Inn hotels. The lodging industry has been a tough place for investors and we are avoiding much exposure to the sector. The company has a 1.40% dividend yield -- based on last night's closing stock price of $25.08. Marriott Hotels is not recommended at this time, and currently holds a Dividend.com rating of 3.3 out of 5 stars.