Bank of America (BAC) 59.30 +0.52: ABN AMRO upgrades to BUY from ADD, reflecting improved expense management discipline; after meeting with Ken Lewis, company's CEO, firm was very impressed with his focus on improving customer service and organic growth; firm raises FY01 EPS estimates to $5.00 from $4.80 and FY02 EPS estimates to $5.35 from $5.25.
BEFORE THE OPEN (Updated throughout the hour)******
Gerber Scientific (GRB) 7.40: Reports Q4 earnings loss of $0.04 a share, in line with the First Call consensus; in Q4, company implemented plans to reduce worldwide employment by approximately 350 employees, or13% of workforce, discontinue product lines, and consolidate facilities as part of its overall strategic initiative to restructure operations and reduce costs. Company also issues upside preannouncement for Y02, expecting $0.45-0.50 vs current First Call EPS estimate of $0.43; see press release.
Check Point Sftwr (CHKP) 54.41: Banc of America Sec initiates coverage with a BUY rating and a 12-month price target of $75; firm says the VPN market is growing rapidly, as corporations look for ways to cut costs and service providers attempt to offer value-added services, and believes Check Point's penetration of the high-growth VPN market is key to maintaining its strong growth; says rapid payback period of Check Point's solutions may shield it better than some other technology providers from the current spending slowdown.
PacifiCare Hlth (PHSY) 18.50: Prudential downgrades to SELL from HOLD based on the lost earnings visibility and the worsening industry trends; yesterday after the close, PacifiCare lowered EPS guidance from $2.94 to $1.65-$1.75 for 2001, citing higher than expected medical costs in California; in firm's view, the visibility on earnings is virtually non-existent, and although management is striving to repair the existing problems, the reimbursement changes appear to have disrupted the claims process to an enormous degree.
REX Stores (RSC) 21.50: Specialty retailer of consumer electronic products and appliances reports Q1 earnings of $0.53 a share, $0.02 better than the First Call consensus of $0.51, vs year-ago earnings of $0.42; revenues fell 2.8% to $104.16 mln from a year-ago of $107.18 mln; comparable store merchandise sales for the quarter fell 13%; see press release.
Plug Power (PLUG) 28.75: Fuel cell company announces that W. Mark Schmitz has been appointed vice president and chief financial officer; most recently, Schmitz served as vice president and chief financial officer for DirecTV Latin America, L.L.C.; see press release.
BellSouth (BLS) 40.25: Company has filed documents with the Florida Public Service Commission asking that it be allowed to provide long distance service in the state. BellSouth-Florida President says that "a recent study states that keeping BellSouth out of long distance is costing Florida customers up to $1.2 billion a year and that new competition may lower long distance prices by 20 to 32%; see press release.
Procter & Gamble (PG) 64.37: Company and Viacom Plus, the cross-media sales and marketing unit of Viacom (VIA) announces a cross-platform marketing partnership; the agreement is the largest such deal to date and encompasses marketing initiatives for P&G brands across 12 Viacom television properties in the US: CBS Television Network, MTV, MTV2, VH1, Nickelodeon/Nick at Nite, CMT, BET, UPN, TV Land, Paramount Television, King World and Comedy Central; see press release.
Charles Schwab (SCH) 18.65: Bear Stearns downgrades to ATTRACTIVE from BUY; primary reasons for downgrade: 1) Risk to key long-term valuation drivers and 2) Risk to short-term earnings power; firm lowers earnings estimates as follows: 2Q01 from $0.11 to $0.10; FY01 from $0.47 to $0.45; and FY02 from $0.70 to $0.62; lowers our 12-month price objective from $25 to $21; firm's decision to downgrade SCH represents the concerns outlined by recent fundamental data versus a longer-term bias.
Tellabs (TLAB) 33.93: Company will record restructuring and other charges totaling approximately $262 mln in the second quarter of 2001, compared to previous estimate of $150-$225 mlm; the larger charge reflects a thorough review of facilities, assets and inventory in light of current industry conditions; see press release.
Merrill Downgrades : Merrill Lynch downgrades XO Comms (XOXO) to near-term NEUTRAL from near-term BUY; also downgrades McLeodUSA (MCLD) to near-term NEUTRAL from near-term ACCUMULATE, to reflect factors that overshadow each company, leading to firm's conservative view of the near-term potential for each stock; following recent meetings with each company's management, firm believes that there are few near term catalysts and that it will take a few quarters of solid execution on recently reduced business plans before investors will return.
Merrill Lynch (MER) 64.27: JP Morgan initiates coverage with a long term BUY rating and price target of $72 given full valuation and limited near-term earnings visibility; firm says valuation is full given current industry environment and the prospects for prolonged decline in client activity; believes margin expansion opportunity at Private Client Group (PCG) and Investment Managers (MLIM) could provide upside but execution will be challenging in this environment.
Citrix Systems (CTXS) 25.09: UBS Warburg downgrades to HOLD from STRONG BUY and lowers price target to $27.50 from $40; firm believes CEO decision is at best an awkward end to the failed search for an outside CEO candidate; firm is seeing some increasing signs of weakness in enterprise sales channels that add to the risk.
Compaq (CPQ) 15.70: ABN AMRO reduces estimates to reflect protracted weakness in PC demand; FY01 estimate reduced to $0.55 from $0.65 and FY02 lowered to $0.87 from $0.97; firm maintains positive outlook on the stock based on valuation and has target price of $25.
Computer Sci (CSC) 41.31: Company has agreed to perform $150 mln in modernization work for the U.S. Customs Service (USCS) as part of IBM Global Services' e-Customs Partnership; CSC will provide security and telecommunications services under the 15-year, $1.3 bln contract the partnership won recently to update USCS operational systems; see press release.
Genomic Sols (GNSL) 3.73: Supplier of automated solutions for genomic and proteomic research announces that the U.S. Patent and Trademark Office has awarded the company a significant patent covering the automated hybridization of DNA microarrays; see press release.
Costco Cos (COST) 37.29: Reports Q3 earnings of $0.23 a share, in line with the First Call consensus, vs year-ago earnings of $0.26; revenues rose 12.0% to $7.72 bln from a year-ago of $6.89 bln; see press release.
Chico's FAS (CHS) 30.75: Women's casual clothing retailer reports Q1 earnings of $0.45 a share, $0.02 better than the First Call consensus of $0.43, vs year-ago earnings of $0.28; revenues rose 64.5% to $93.23 mln from a year-ago of $56.69 mln; net income climbed 65.6% to a record $12.4 mln; company has opened 13 of 55 planned stores for current fiscal year; see press release. |
