FEBRUARY 9, 2012, 1:38 P.M. ET
Article from The Wall Street Journal
U.S. stocks traded higher Thursday as the Dow Jones Industrial Average recently gained 20 points to 12903, the Standard & Poor's 500-stock index rose 2.7 points to 1353, and the Nasdaq Composite index added 9 points to 2925. Among the companies whose shares are actively trading in the session are Apple Inc. (AAPL), Teradata Corp. (TDC) and TripAdvisor Inc. (TRIP).
Apple ($495.80, +$19.12, +4.01%) shares are on the verge of completing the march to $500 as rumors of the as-yet-unconfirmed iPad 3 announcement and upbeat Street commentary give further fuel to the stock. The All Things D blog says Apple was planning an event during the first week of March in San Francisco to announce the iPad 3. At the same time, several analysts have boosted stock-price targets for Apple, with Canaccord lifting its current-quarter iPhone sales target nearly 10%.
Teradata's ($63.79, +$5.75, +9.91%) fourth-quarter earnings rose 15% as all regions posted double-digit revenue increases and the business-data storage company approved a new $300 million stock-repurchase program.
TripAdvisor's ($28.72, -$5.62, -16.37%) first quarterly results since its separation from Expedia Inc. (EXPE, $33.90, +$0.25, +0.74%) aren't pleasing investors. Fourth-quarter earnings fell short of estimates and, more importantly, the travel website gave a meek outlook as it continues to invest "even in the phase of a slower revenue growth this year." Benchmark lowered its stock-investment rating on TripAdvisor to hold from buy, saying "the level of increased expenses is surprising."
PepsiCo Inc. (PEP, $64.27, -$2.47, -3.70%) plans to spend as much as $600 million more on marketing this year to try to improve sales in North America and will lay off about 3% of its global work force to pay for it as part of a much-anticipated strategic overhaul to try to catch up to global rival Coca-Cola Co. (KO, $67.89, -$0.44, -0.64%).
Thoratec Corp. (THOR, $34.49, +$3.68, +11.94%) topped fourth-quarter consensus estimates and says international sales are strong. The company saw mid-teens volume growth in sales of its HeartMate II pump in both the U.S. and Europe. Other heart device companies, on the other hand, have reported weakness in Europe this quarter.
Other Stocks in Focus:
Affymetrix Inc. (AFFX, $4.90, -$0.31, -5.95%) swung to a wider-than-expected fourth-quarter loss as product sales and revenue from royalties slumped.
Akamai Technologies Inc.'s (AKAM, $37.67, +$3.23, +9.38%) fourth-quarter earnings rose 14%, beating analysts' expectations, helped by strong revenue growth, and the company named a new finance chief.
Albany International Corp. (AIN, $24.67, -$0.95, -3.71%) reported fourth-quarter results that fell well below analysts' predictions.
American Superconductor Corp. (AMSC, $5.52, -$0.51, -8.46%) reported a wider third-quarter loss Thursday and said it remains focused on China's giant wind-power market, despite its lawsuits against former customer Sinovel Wind Group Co. Ltd. (601558.SH). The Massachussets-based wind-turbine component maker has accused Sinovel, China's largest wind-turbine maker, of stealing valuable trade secrets, copying protected software and canceling contracts.
Collins Stewart raised its stock-investment rating on Arris Group Inc. (ARRS, $12.00, -$0.33, -2.68%) to buy from hold despite the company's in-line fourth-quarter results and guidance. Arris, which provides local-access networks with video, high-speed and telephone systems to homes and businesses, "stands to benefit meaningfully" from increased shipments of its Gateway set-top box product in 2012, the firm says.
Though Corporate Office Properties Trust (OFC, $24.35, -$0.70, -2.79%)'s fourth-quarter revenue beat analysts' predictions, the company's first-quarter and full year per-share earnings outlook falls short of Wall Street consensus.
Belden Inc.'s (BDC, $38.28, -$2.61, -6.38%) fourth-quarter earnings beat analysts' expectations, but revenue fell short and the company issued weak guidance for the current quarter and full year.
Bunge Ltd.'s (BG, $62.91, +$3.17, +5.30%) fourth-quarter earnings fell 16% on a sharp rise in costs, though the farm-products company's revenue grew more than expected.
J.P. Morgan lowered its stock-investment rating on Compass Minerals International Inc. (CMP, $72.95, -$3.36, -4.40%) to underweight from neutral, noting that the historical pattern is for volume to be "a few percent" lower and prices flat in the year following a very warm winter. "Accordingly, we think there is likely to be less earnings lift in 2012 and 2013 than appears at first sight," the firm says.
Diamond Foods Inc. (DMND, $23.39, -$13.27, -36.20%) said it will appoint a new chief executive and chief financial officer and will restate earnings for the past two fiscal years after an internal probe found the company's payments to walnut growers weren't accounted for in the correct periods.
Diodes Inc. (DIOD, $25.57, -$0.59, -2.26%), which makes transistors and protection devices for the semiconductor industry, reported fourth-quarter per-share earnings and sales that fell short of analysts' expectations. The low end of the company's first-quarter revenue guidance range also misses expectations.
Dunkin' Brands Group Inc. (DNKN, $28.21, -$0.80, -2.76%) swung to a fourth-quarter profit from a year-earlier period that included heavier charges as strong same-stores sales contributed to better-than-expected revenue. However, shares declined as operating margin fell.
Eastman Kodak Co. (EKDKQ, $0.44, +$0.01, +2.94%) plans to phase out its capture-devices business, which includes digital cameras, pocket video cameras and digital picture frames, during the first half of this year. The move should to save more than $100 million a year, and Kodak expects to book a $30 million charge from exiting the business.
EnerSys Inc. (ENS, $33.37, +$1.52, +4.77%) posted third-quarter results that surpassed Wall Street expectations. The battery maker also forecasts fourth-quarter per-share earnings well above analysts' expectations.
Equifax Inc.'s (EFX, $41.25, +$1.85, +4.70%) fourth-quarter earnings rose 20% as the credit-reporting company posted revenue growth led by its U.S. consumer-information services business.
Forrester Research Inc.'s (FORR, $32.44, -$2.86, -8.10%) fourth-quarter earnings beat analysts' expectations, but revenue fell short and the company issued disappointing guidance for the current quarter and full year.
General Cable Corp.'s (BGC, $32.73, -$1.52, -4.44%) fourth-quarter earnings plunged 87% as mark-to-market losses on derivatives and debt expenses weighed on bottom-line results, though volume and margins also slipped. The maker of copper, cable and fiber-optic wire products' results missed analyst expectations.
Gildan Activewear Inc. (GIL, $23.75, +$1.49, +6.69%) posted a hefty loss in its fiscal first quarter but the result was nonetheless a bit better than its own expectations, thanks to net selling prices for Printwear that were better than projected.
Groupon Inc. (GRPN, $21.30, -$3.28, -13.34%) posted a surprise fourth-quarter loss as expenses and one-time charges outpaced revenue growth. For the current quarter, the company projected revenue that tops analysts' estimates, but shares still fell on the weaker-than-expected bottom-line results.
Hanger Orthopedic Group Inc.'s (HGR, $21.49, +$0.43, +2.04%) fourth-quarter results exceeded analysts' expectations, helped by the company's acquisitions. The company's full-year revenue guidance also came in higher than Wall Street consensus.
Heartland Payment Systems Inc.'s (HPY, $26.98, +$2.26, +9.14%) fourth-quarter results came in above analysts' expectations. The payment processor also issued a stronger-than-expected outlook for the current year and raised its quarterly dividend by 50%.
Imperial Sugar Co.'s (IPSU, $5.17, +$1.81, +53.87%) fiscal first-quarter loss narrowed significantly and the bottom-line result beat analysts' expectations.
IRobot Corp. (IRBT, $26.11, -$12.19, -31.83%) reported its fourth-quarter profit climbed 52% as revenue improved, though the robot maker forecast first-quarter and full-year results sharply below analysts' expectations.
Ironwood Pharmaceuticals Inc. (IRWD, $14.65, +$0.86, +6.24%) said it is offering 5.3 million Class A shares to help strengthen its balance sheet ahead of the potential launch of its gastrointestinal drug, which won't see a review from an FDA advisory panel.
Jefferies lowered its stock-investment rating on Joy Global Inc. (JOY, $87.00, -$2.70, -3.01%) to hold from buy after the shares have risen nearly 50% since October to meet the firm's price target.
Lorillard Inc.'s (LO, $125.16, +$11.80, +10.41%) fourth-quarter earnings jumped 20% as the cigarette maker reported higher shipments due to gains for the Newport and Maverick brands and higher selling prices across all brands, helping lift sales and profit above analysts' expectations. The company also reported higher margins and increased its quarterly dividend by 19%.
Momenta Pharmaceuticals Inc. (MNTA, $15.60, -$0.56, -3.47%) posted fourth-quarter results that fell well below analysts' expectations.
Hedge fund manager Och-Ziff Capital Management Group LLC's (OZM, $10.48, +$0.29, +2.85%) fourth-quarter net loss widened on lower incentive income resulting from negative returns experienced by most of the company's funds last year. However, shares were up as Och-Ziff's distributable earnings, which calculate cash flow to investors, beat analysts' expectations.
Philip Morris International Inc.'s (PM, $80.72, +$2.84, +3.65%) fourth-quarter profit climbed 7.6%, as the tobacco company notched strong volume growth in Asia, which helped overall cigarette shipments rise modestly. The results topped Wall Street's expectations. Shares of Altria Group Inc. (MO, $29.26, +$0.42, +1.46%) and Reynolds American Inc. (RAI, $40.07, +$0.45, +1.14%) also saw gains.
Select Comfort Corp.'s (SCSS, $28.62, +$1.45, +5.34%) fourth-quarter results beat analysts' expectations and the mattress seller issued current-year earnings guidance above Wall Street's consensus view. The company also announced plans to reinstate a "modest" share repurchase plan in 2012.
Though Service Corp. International (SCI, $11.20, +$0.26, +2.38%) posted fourth-quarter revenue that fell short of analysts' predictions, the company's per-share earnings rose above Wall Street consensus.
Following Sprint Nextel Corp.'s (S, $2.35, -$0.06, -2.41%) earnings release yesterday, Credit Suisse now expects the carrier to report a combined loss of 364,000 contract customers in 2012 and 2013, a change from a forecast of a gain of 919,000. That's because Credit Suisse sees greater customer turnover among users of Sprint's older network technologies as it upgrades to 4G LTE during the next several years.
Human-resources software company Taleo Corp. (TLEO, $45.65, +$6.71, +17.23%) is being acquired by Oracle Corp. (ORCL, $28.72, -$0.01, -0.05%) for $1.9 billion, highlighting the push that traditional software companies are making to expand with cloud-based products.
Taubman Centers Inc.'s (TCO, $69.68, +$1.53, +2.25%) fourth-quarter earnings surged as the luxury-mall owner reported a significant accounting gain from debt extinguishment on two former properties, as rent and occupancy continued to rise. The company forecast 2012 funds from operations, a key profitability metric for real-estate investment trusts, of $3.14 to $3.24 a share, which surpasses analysts' predictions.
The Hanover Insurance Group Inc.'s (THG, $39.82, +$2.06, +5.46%) fourth-quarter results beat analysts' expectations as pricing trends continued to improve and retentions increased.
TriQuint Semiconductor Inc.'s (TQNT, $6.35, -$0.50, -7.24%) fourth-quarter results beat analysts' expectations, but the high end of the chip maker's first-quarter adjusted earnings guidance just met Wall Street's consensus view.
United Technologies Corp.'s (UTX, $83.67, +$1.93, +2.36%) shares "will rise in absolute terms over the next 45 days," Morgan Stanley says. The investment bank is confident that the maker of Otis elevators, Pratt & Whitney aircraft engines and Carrier air-conditioning systems will materially reduce its previous guidance for 2012 dilution resulting from its takeover of aircraft-components maker Goodrich Corp. (GR, $125.36, -$0.02, -0.02%) and increase its 2013 accretion guidance, driven by a smaller equity raise and sooner-than-expected synergies.
Visa Inc. (V, $113.41, +$5.06, +4.67%) posted a 16.4% increase in fiscal first-quarter profit as the credit-card processor continued to benefit from consumers' increased use of plastic while grappling with new federal rules that affect debit-card purchases.
Whole Foods Market Inc.'s (WFM, $80.24, +$2.31, +2.96%) fiscal first-quarter income jumped 33% as the natural-foods supermarket saw same-store sales continue to grow as margins edged higher. The company also raised its 2012 earnings guidance.
-Edited by Maya Pope-Chappell and Ian Thomson; write to maya.pope-chappell@dowjones.com and ian.thomson@dowjones.com
Article from The Wall Street Journal