SBC Communications (SBC
) is reportedly in talks to bid for General Motors unit Hughes Electronics (GMH
), owner of satellite broadcaster DirectTV, for $10 billion. SBC's interest could give Hughes more leverage against media giant News Corp. (NWS
), which recently reaffirmed its interest in DirecTV. Up until now, News Corp. has been considered the only bidder for DirecTV.
After the close of trading Monday, credit ratings agency Moody's cut American Airlines' parent AMR 's (AMR
) rating deeper into "junk" status, after the world's largest airline asked unions and other workers for $1.8 billion of annual cost cuts to avoid a possible bankruptcy. S&P says it may also cut its ratings. Lower credit ratings may make it harder for the airline to borrow money and avoid bankruptcy.
After the close of trading Monday, Yum! Brands posted fourth quarter (Dec.) 56 cents earnings per share, beating estimates by a penny. Revenues jumped 11.8% to $2.46 billion. The fast-food owner and franchiser sees first quarter earnings of at least 38 cents a share. Yum's assets include KFC, Pizza Hut, and Taco Bell.
) says its patent position surrounding its drug ribavirin is likely to be unchanged by Schering Plough's recent action. Schering recently announced a settlement of its ribavirin patent litigation with a generic manufacturer. Gerard Klauer downgraded Ribapharm to neutral from outperform.
) says Tom Christerson, a patient who received the second AbioCor implantable peplacement heart on Sept. 13, 2001, died at Jewish Hospital in Louisville, KY. The cause of death was wearout of the internal membrane of AbioCor.
S&P upgraded Corning (GLW
) to hold from following the company's analyst day on Friday.
Energy service company Cal Dive (CDIS
) sees breakeven fourth quarter vs. 19 cents earnings per share consensus as the result of an establishment of about $10 million pre-tax reserves for disputed billings on a major construction project in Trinidad and for EEX litigation. UBS Warburg reportedly cut to neutral.
Thomas Weisel upgraded ImClone (IMCL
) to buy. On Friday ImClone and Bristol Myers announced the opening of a limited access program in the U.S. for Erbitux, for patients with metastatic colorectal cancer.
Marriott International (MAR
) posted 55 cents vs. 22 cents fourth quarter earnings per share from continuing operations on 20% higher systemwide sales. The hotel operator sees $1.85 to $1.95 2003 earnings per share from continuing operations, and 2003 RevPar roughly flat vs. 2002.
Johnson & Johnson (JNJ
) agrees to acquire Scios (SCIO
) for about $2.4 billion, or $45 per share, to boost its drug pipeline. Scios' key product is Natrecor, a treatment for congestive heart failure. Scios is also working on an oral drug for rheumatoid arthritis.
Salomon upgraded Amerus Group (AMH
) to outperform from in-line; citing the stability of fundamentals, attractive valuation, and a solid capital base. On Friday the company posted 92 cents vs. 79 cents fourth quarter earnings per share (excluding items).
CIBC World upgraded John Hancock (JHF
)to sector outperform from sector perform on price. On Friday the financial services firm posted 78 cents vs. 71 cents fourth quarter earnings per share (excluding items), and reaffirmed 2003 guidance of 7%-11% growth in net operating earnings per share.
Salomon upgraded Mellon Financial (MEL
) to in-line from underperform on price.
Reliance Steel (RS
) sees lower than expected four cents to six cents fourth quarter earnings per share, citing further weakening of the economy as metals pricing softened and demand declined, particularly in December.
OSI Pharmaceuticals (OSIP
) posted an 83-cent first quarter loss vs. a 35-cent loss on a 24% revenue decline, and an increase in development costs related to clinical programs. OSI agreed to acquire Cell Pathways (CLPA
) for $32 million in OSI stock.
Abbott Labs ( ABT
) is stopping a Phase III trial for atrasentan, its treatment of end-stage prostate cancer, after data showed the drug didn't meet its primary goal of preventing time-to-disease progression.
) posted 30 cents vs. 25 cents first quarter earnings per share on an 8.8% sales rise, and sees 70 cents to 75 cents second quarter earnings per share.
Merrill reportedly upgraded Cablevision (CVC
) to buy from neutral.
Toll Brothers (TOL
) says amid fears about a housing bubble, a weak economy and stock market, and a potential war with Iraq, the company is seeing no slowdown in demand, according to Barron's.