Markets & Finance

Sears Tumbles as Top Exec Resigns


Speaking at a Gartner Symposium in Florida, Cisco 's (CSCO) CEO John Chambers reportedly says customers' visibility into their business is getting tighter. Deutsche Bank cut its estimates.

UBS Warburg cut its estimates on Mercury Interactive (MERQ) amid a more modest IT spending recovery next year.

SWS Securities downgraded Veritas (VTS) to market outperform from strong buy.

J.P. Morgan Chase upgraded Marsh & McLennan (MMC) to overweight from neutral on recent price weakness.

Sears Roebuck (S) shares fell after it warned that third-quarter EPS will be $0.80 to $0.82, including a $0.03 per share dilution from the Land's End acquisition. The retailer announced that its executive vice president and president of the credit unit has left the company. CSFB downgraded the stock. S&P is keeping its accumulate recommendation.

TXU (TXU) fell after Banc of America downgraded to market perform from buy. On Friday, the company forecast EPS of $0.90-$0.95 in the third quarter, $0.60-$0.65 in the fourth quarter, and $3.45-$3.55 in 2003.

Tobacco issues were rebounding from the sharp sell-off Friday after Philip Morris (MO) was ordered by a Los Angeles jury to pay a $28-billion punitive damage award to smoker.

Capital One (COF) shares were lower after Goldman Sachs downgraded to market perform from market outperform. Goldman also cut AmeriCredit (ACF) to market underperform from market perform, and removed Household International (HI) from the recommended list, and now rates market outperform.

Adolph Coors (RKY) shares rose after Morgan Stanley upgraded to equal-weight from underweight.

In response to inquiries concerning trading activity at the end of last week, Moody's (MCO) says it expects third quarter EPS to meet or exceed the $0.39 consensus estimate, with 2002 EPS around the high end of the $1.65-$1.78 range previously provided.

According to The Wall Street Journal, the Securities and Exchange Commission is investigating AOL Time Warner's (AOL) investment-and-advertising deal with Oxygen Media, and is looking at whether the deal involved booking the same revenue at more than one division.

Comtech Telecom (CMTL) says in response to a "significant" increase in trading activity on Friday, it expects to meet fourth quarter EPS guidance of $0.05-$0.07, excluding an in-process R&D charge.

Morgan Stanley downgraded Arkansas Best (ABFS) to equal-weight from overweight.

According to The Wall Street Journal, JP Morgan (JPM) is preparing to lay off as many as 4,000 employees. The affected divisions could lose as much as 25% of their staff.

Haemonetics (HAE) says due to regulatory delays for protocol additions, product enhancement plans for OrthoPAT systems, and delays in other new products, it now sees $1.15-$1.20 fiscal 2003 EPS on revenue growth in the high single digits.

Entergy (ETR) sees better than expected third quarter operating EPS of at least $1.45, including the impact of milder than normal weather. Entergy raised its $3.40-$3.60 2002 operating EPS to $3.60-$3.70.

JDN Realty (JDN) agreed to be acquired by Developers Diversified Realty in a deal valued at about $1.02 billion. Terms: 0.518 Developers' share per JDN share.

UBS Warburg downgraded ASML Holdings (ASML) to sell from hold, citing concerns over debt repayment, and uncertainty over 300mm SPE demand. UBS also cut the EUR 16 target to EUR 4.

FMC (FMC) sees about $0.78 third quarter EPS due to stronger than expected sales in Agricultural Products, and lower overhead costs in both Agricultural Products and Industrial Chemicals.

Datum 's (DATM) board will not pursue an unsolicited, non-binding, conditional offer made by Frequency Electronics to acquire Datum for $2.00 cash and one Frequency share per Datum share.


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