Wal-Mart (NYSE:WMT) is scheduled to report Q1 on May 13. WMT June option implied volatility of 23 is below its 26-week average of 26 according to Track Data, suggesting decreasing price risk.
Gap (NYSE:GPS) is scheduled to report Q1 EPS on May 22. Buckingham Research says "We continue to rate the shares of GPS as Neutral due to valuation and lack of progress on a turnaround." GPS June option implied volatility of 41 is near its 26-week average, suggesting non-directional price risk.
Option Update is provided by Stock Specialist Paul Foster of theflyonthewall.com
Bank of America downgraded GAP (NYSE:GPS) to "neutral" according toBriefing.com. The news service also reports that Citigroup has downgraded Priceline (NASDAQ:PCLN) to "hold" from "buy"
RBC Capital Markets said that sales at Digital River (NASDAQ:DRIV) were above its estimates and kept its "outperform" rating on the stock, according to the AP.
UBS downgraded Nokia (NYSE: NOK) from "buy" to "neutral," according toBriefing.com. The news service also reports Lehman initiated Garmin (NASDAQ:GRMN) as "equal weight."
Cisco Systems (NASDAQ: CSCO) started as "buy" at Lazard, according to24/7 Wall St. The financial website also reports that Gap Inc (NYSE:GPS) was cut to "equalweight" from "overweight."
Douglas A. McIntyre is an editor at 247wallst.com.
PDUFA date for Bristol-Myers Squibb Co. (NYSE: BMY)'s supplemental Biologics License Application for Orencia for the treatment of Juvenile Rheumatoid Arthritis.
Alcoa Inc. (NYSE: AA) to report Q1 earnings; conference call at 5pm.
Tuesday, April 8
Chattem Inc. (NASDAQ: CHTT) to report Q1 earnings; conference call at 9:00am.
FOMC to release minutes of the March 18th meeting at 2:00pm.
As the mega-merger that created Citigroup (NYSE: C) is nearing ten years, the Financial Times interviewed John Reed, one of the masterminds behind the deal. Interestingly, he told the paper that the deal was a mistake and blasted several segments and personnel at the bank.
In other Citi news, the bank has agreed to pay $33 million to settle a discrimination lawsuit involving about 2,500 current and former female brokers at the company's Smith Barney subsidiary.
The Wall Street Journal reports that senior executives of Microsof (NASDAQ: MSFT) and Yahoo! (NASDAQ: YHOO) met this week to discuss Microsoft's bid for Yahoo!. Already we heard a few days ago that Microsoft is unwilling to raise its offer, and for now at least, Yahoo! continues to refuse to enter formal negotiations without a better offer. While no doubt Microsoft wants Yahoo!, it may be that Yahoo! needs Microsoft. On that basis, it's possible Microsoft could hold its own, betting Yahoo! would cave in first.
Friedman Brillings started Cisco (NASDAQ:CSCO) at "outperform" with a $31 price target according toBriefing.com. The news service also reports that Credit Suisse downgraded Sirius (NASDAQ:SIRI) from "outperform" to "neutral".
Dell Inc. (NASDAQ:DELL) was cut to "neutral" from "buy" at Goldman Sachs according to 24/7 Wall St. The financial site also reports that Gap Inc (NYSE:GPS) was cut to "neutral" from "outperform" at Credit Suisse.
J. Crew Group (NYSE: JCG) is a multi-channel retailer of women's and men's apparel, shoes and accessories. Known for its preppy fashions, the firm targets young professionals through 203 retail stores, a catalog business, a Web site and 63 factory outlet stores. Asian contractors produce about eighty percent of the company's merchandise. Competitors include Gap (NYSE: GPS) and Abercrombie and Fitch (NYSE: ANF).
The company pleased investors last month, when it reported Q4 EPS of 41 cents (ex-items). That topped the average Street estimate by two cents. Revenues rose 53.5% (yr/yr) to $399.9 million ($400.9M consensus). Gross margins improved 50 basis points to 41.3% and operating margins increased 60 basis points to 10.8%. Management guided FY09 EPS to $1.85-$1.87, versus consensus of $1.83.
Guess? Inc. (NYSE: GES) designs, markets, distributes and licenses a trendy, upscale collection of contemporary apparel, accessories and related consumer products. The company operates 373 retail stores in the United States and Canada and also distributes its products through department and specialty stores around the world. Competitors include Gap Inc. (NYSE: GPS) and Abercrombie & Fitch (NYSE: ANF).
Guess? surprised investors last week, when it reported Q4 EPS of 59 cents and revenues of $514.6 million. Both totals were company records. Analysts had been looking for 57 cents and $470 million. Management also issued Q1 and FY09 estimates that were essentially in-line with Street views and the Board approved a $200 million share repurchase program. Wedbush Morgan subsequently reiterated its "buy" recommendation on the stock.
MOST NOTEWORTHY: Credit Suisse, Bank of America and Bear Stearns were today's noteworthy downgrades:
UBS downgraded Credit Suisse (NYSE: CS) to Neutral from Buy to reflect the company's higher-than-expected write-downs in Q1.
Merrill cut Bank of America (NYSE: BAC) to Sell from Neutral and lowered their estimates to reflect a higher credit loss outlook as they now estimate Bank of America's loan provision will rise to $15B in 2008 from $8.4B in 2007.
Sandler O'Neil downgraded Bear Stearns (NYSE: BSC) to Sell from Hold citing share premium to deal value of $10.00.
OTHER DOWNGRADES:
Citigroup lowered Gap (NYSE: GPS) to Hold from Buy.
Tiffany & Co (NYSE: TIF) was downgraded to Perform from Outperform at Oppenheimer.
3Com (NYSE: COMS) shares were up 7% in after-hours trading Monday as the network-equipment maker, whose $2.2 billion acquisition by Bain Capital LLC was said last week to be pulled off due to the government's security concerns, reported third- quarter sales of $336.4 million and 8 cents earnings per share (excluding one-time items), beating estimates.
Valero Energy (NYSE: VLO) shares are down over 3% in premarket trading after the refinery operator forecast significantly lower throughput margins on gasoline and other petroleum products and forecast first-quarter earnings of $0.10 to $0.35 per share below analyst estimates.
Activist investor Carl Icahn rejected an offer from Motorola Inc. (NYSE: MOT) that would have given him two board seats instead of the four Icahn had launched a proxy battle to get. Icahn, who holds 6.3% of the shares in the telecommunications-equipment maker, sued the company for access to crucial board documents. Icahn has been hpushing Motorola to divest the unprofitable handset division for months. While Icahn has been quite vocal with his criticism, Motorola's board and management haven't commented much.
MOST NOTEWORTHY: Lehman, CIT Group and Auxilium Pharma were today's noteworthy downgrades:
Oppenheimer cut Lehman (NYSE: LEH) to Perform from Outperform on valuation, as they see a "protracted challenging capital markets environment."
The firm also downgraded CIT Group (NYSE: CIT) to Perform from Outperform, as they believe the company addressed its liquidity concerns too late and will be forced into a fire sale of assets.
Merriman downgraded shares of Auxilium Pharma (NASDAQ: AUXL) to Sell from Neutral as they believe there were a number of unexpected adverse events in the phase 3 trials of XIAFLEX that could potentially delay the approval and launch. They see significant potential downside in the interim.
OTHER DOWNGRADES:
Gap (NYSE: GPS) was lowered to Neutral from Buy at UBS.
Wachovia cut Symmetry Medical (NYSE: SMA) to Market Perform from Outperform.
Wells Fargo (NYSE: WFC) was downgraded by Baird to Underperform from Neutral.
Inter Parfums (NASDAQ: IPAR) develops, manufactures and distributes prestige perfumes and cosmetics, as the exclusive worldwide licensee for such names as Burberry, Paul Smith, S.T. Dupont, Christian Lacroix, Quiksilver/Roxy and Van Cleef & Arpels. The firm owns owns Lanvin Perfumes and Nickel S.A. It also designs and manufactures personal care products under exclusive agreements with the Gap (NYSE: GPS), New York & Company (NYSE: NWY) and Brooks Brothers. Further, it makes fragrances, cosmetics and personal care products for the mass market. The latter lines are offered by such merchandisers as Wal-Mart Stores (NYSE: WMT). Inter Parfums products are sold in over 120 countries.
The firm surprised the Street last week, when it reported Q4 EPS of 41 cents and revenues of $119.4 million. Analysts had been looking for 34 cents and $119.2 million. Management also guided FY08 EPS to about $1.25 ($1.14 consensus) and FY08 revenues to about $442 million ($439.31M consensus).
Microsoft Corp. (NASDAQ: MSFT) will cut the price of some boxed versions of Windows Vista from 20-48%, as at least one executive feel the company had "botched" the marketing of computers as "Vista Capable." I'm surprised that Microsoft doesn't understand it needs to offer a better product rather than lowering the price on a product that isn't up-to-par...
Gap Inc. (NASDAQ: GPS) shares are up over 5.9% in premarket trading after reporting quarterly results after the close Thursday. Gap's fourth-quarter profit increased 21% after three years of consecutive declining sales. Cost cutting measures boosted the profit line. The company promised more such measures as well as a $1 billion share buyback. the retailer has also raised its quarterly dividend by six percent to 34 cents per share. Gap earned $265 million, or 35 cents per share, inline with estimates. Revenue totaled $4.68 billion, a 5% from the year ago period. Same-store sales, however, fell 3%.
Here are highlights of some other earnings reports from Thursday:
Gap Inc. (NYSE: GPS) reported a 21% increase in its fourth-quarter profit year over year. The $265 million, or 35 cents per share, matched analysts' expectations. Revenue totaled $4.68 billion, down 5% from the previous year.
Kohls Corp. (NYSE: KSS) fourth-quarter profit fell about 15% year over year to $411.7 million, or $1.31 per share, just beating analysts' estimates. Sales rose less than 1% $5.49 billion, but same-store sales fell.
Novell Inc. (NASDAQ: NOVL) swung to a profit in its fiscal first quarter: $16.8 million, or 5 cents per share, matching expectations. Revenue rose to $230.9 million from $218.4 million a year ago.
Apple Inc. (NASDAQ: AAPL) COO Tim Cook, speaking at a Goldman Sachs investment conference, backed Apple's goal of selling 10 million iPhones in fiscal 2008. AAPL shares are up over 2.6% in premarket trading. Cook also said Apple is open to exploring new ways of selling its iPhone including offering it with other networks. Next week, he said, Apple will show developers how to create software for the iPhone. An event is scheduled for March 6.
Reporting today:
Gap Inc. (NYSE: GPS) is expected to report earnings of 33 cents a share in the fourth quarter.
Kohl's Corp. (NYSE: KSS) is expected to report earnings of $1.34 a share in the fourth-quarter .
Hansen Natural Corp. (NASDAQ: HANS) is expected to report earnings of 39 cents a share in the fourth-quarter.
Viacom Inc. (NYSE: VIA) is expected to report earnings of 83 cents a share in the fourth-quarter.
Wal-Mart (NYSE:WMT) is scheduled to report Q1 on May 13. WMT June option implied volatility of 23 is below its 26-week average of 26 according to Track Data, suggesting decreasing price risk.
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