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Analog Devices, Brocade, HP, Merck, Playboy, Zale
By Robert Daniel, MarketWatch
Last Update: 7:51 AM ET Nov 24, 2009
TEL AVIV (MarketWatch) -- Shares expected to see active trade in Tuesday's session include Analog Devices, Brocade, Heinz, HP, Medtronic, Merck, Playboy, Warner Music and Zale.
Analog Devices Inc. ADI reported fiscal fourth-quarter net income fell to $105.6 million, or 36 cents a share, from $143.9 million, or 49 cents a share, in the year-earlier period. Revenue fell 13% to $572 million. Analysts polled by Thomson Reuters had estimated earnings of 26 cents a share and $523.8 million in revenue.
Brocade Communications Systems Inc. BRCD fiscal fourth-quarter net income slipped to $33.6 million, or 7 cents a share, from $35.6 million, or 9 cents, in the year-earlier period. Excluding special items, the latest earnings were 15 cents a share. The networking equipment maker said revenue for the period ended in October rose 31% to $521.8 million. Analysts polled by Thomson Reuters had estimated Brocade would report 13 cents a share of profit and $521.8 million in revenue.
Citigroup: C BMO Financial Group BMO definitively agreed to purchase the Diners Club North American franchise from Citi, C a move it said will more than double its corporate card business. In total, the agreement represents net receivables of almost $1 billion and some $7.8 billion in card transactions, the firm said. Separately, Citigroup said the sale is expected to reduce its assets in Citi Holdings by $1 billion and is not expected to have a material impact on net income or capital ratios.
General Electric Co.'s GE GE Capital financial arm continues to stabilize with a dramatic narrowing in losses projected for the long term that should provide a key tailwind to earnings, J.P. Morgan said in a Tuesday note to investors. "The several 'hot spots' in the GECS portfolio have now been reduced to one," commercial real estate, the broker said. "In total, management continues to see provisions a bit better than the adverse case, which makes a capital contribution beyond the fixed charge coverage requirement in 1Q11 unlikely." J.P. Morgan affirmed its overweight rating for the stock with a price target of $17.
H.J. Heinz Co. HNZ second-quarter net income fell to $237.3 million, or 73 cents a share, from $276.7 million, or 87 cents a share, in the year-ago period. Breaking out a one-time loss on the sale of a small non-core business in its U.S. Foodservice unit, Heinz earned 76 cents a share. The Pittsburgh ketchup maker's revenue grew 2.5% to $2.67 billion, led by growth in emerging markets and acquisitions. Analysts expected Heinz to earn 70 cents a share on revenue of $2.6 billion, according to FactSet. Heinz raised its full-year outlook to $2.72 to $2.82 a share from continuing operations, from its earlier view of $2.60 to $2.70 a share. Analysts were looking for $2.75 a share.
Hewlett-Packard Co. HPQ reported a fiscal fourth-quarter profit of $2.4 billion, or 99 cents a share, compared with $2.1 billion, or 84 cents a share, for the year-earlier period. Adjusted profit in the latest period was $1.14 a share. Revenue was $30.8 billion, down from $33.6 billion. Analysts had expected earnings of $1.13 a share on revenue of $30.4 billion, according to Thomson Reuters. Read more about H-P quarterly earnings
Hormel Foods Corp., HRL the Austin, Minn., food producer, raised the quarterly dividend to 21 cents a share from 19 cents, payable Feb. 15 to holders of record Jan. 23.
Medtronic Inc. MDT fiscal second-quarter profit rose to $868 million, or 78 cents a share, from $547 million, or 48 cents a share, in the year-ago period. Revenue rose 8%, to $3.8 billion. Adjusted earnings were 77 cents a share. Analysts surveyed by FactSet Research had expected earnings of 74 cents a share on revenue of $3.75 billion. The Minneapolis medical technology company also raised guidance for the fiscal year 2010 to a range of $3.17 to $3.22 a share.
Merck & Co., MRK the Whitehouse Station, N.J., drug maker, said it won a case in U.S. District Court involving Fosamax, generically alendronate sodium, a drug designed to treat osteoporosis in women past menopause. In a statement late on Monday, Merck said that U.S. District Judge John F. Keenan granted the company a summary judgment and dismissed all the claims by the plaintiff. The plaintiff "failed to present sufficient evidence to support her contention that Fosamax caused her to sustain osteonecrosis of the jaw," Merck said. Osteonecrosis occurs when bone tissue dies.
Playboy Enterprises Inc. PLA signed an agreement to outsource most of the business operations of Playboy magazine to American Media Inc., The Wall Street Journal reported Tuesday. Playboy will retain charge of editorial content but will turn over other responsibilities to AMI, which publishes more than a dozen titles, including Star and Men's Fitness, the report said. The companies didn't disclose financial terms, but Playboy Chief Executive Scott Flanders reportedly said the arrangement will significantly cut costs and help the magazine return to profitability by the end of 2011.
Vimpel-Communications VIP third-quarter profit more than doubled to 13.5 billion rubles ($468 million) from 6.5 billion rubles in the same period a year ago. Revenue at the Russian mobile phone operator rose 3.5% to 71.3 billion rubles from 68.9 billion rubles. Analysts polled by Dow Jones Newswires expected profit of $494.7 million. The number of active mobile subscribers reached 65.4 million, 13% more than a year ago.
Warner Music Group WMG swung to a fiscal fourth-quarter loss of $18 million, or 12 cents a share, while revenue rose 1% to $861 million. The quarter included 9 cents a share of severance costs. The company earned $6 million in the prior-year quarter. Analysts polled by FactSet had forecast a profit of 4 cents a share.
Zale Corp.'s ZLC fiscal first-quarter loss widened to $57.6 million, or $1.80 a share, from $48.4 million, or $1.52 a share, a year earlier. Revenue in the quarter ended Oct. 31 fell to $329.2 million from $364.1 million. Same-store sales declined 6.8%. Analysts estimated a loss of $1.96 a share on sales of $319.2 million. Gross margin widened to 48.6% from 48.5%. "We are encouraged that both sales and margin strengthened as the quarter progressed," said Chief Executive Neal Goldberg. "We will not offer the same level of broad discounting this holiday season as we did in 2008, which will help us expand our gross margin."
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