Markets & Finance

Neurobiological Technologies Drops as Experimental Drug Fails


Neurobiological Technologies (NTII) shares tumbled after Forest Labs announced that memantine, a drug both companies co-developed, failed to demonstrate its effectiveness in treating neuropathic pain in diabetics. The drug is already used to treat Alzheimer's disease. Seperately, Neurobiological posted a 4-cent third-quarter loss, vs. a 6-cent loss. If the drug is approved, Neurobiological will receive royalties from Forest.

Morgan Stanley upgraded Coca-Cola (KO) to overweight from equal-weight. Shares soared.

GBC Bancorp (GBCB) and Cathay Bancorp (CATY) agreed to merge in a deal valued at about $450 million, or $37.95 per GBC share. Terms: GBC holders will get about 64% stock, or 6.75 million shares, and 36% cash, or $162.4 million.

AdvancePCS (ADVP) rose after posting 48 cents vs. 34 cents fourth-quarter earnings per share on a 16% revenue rise. The provider of health improvement services raised the fiscal 2004 earnings per share guidance to $2.10-$2.15. First Albany raised its estimates.

USB Piper says Pharmaceutical Resources (PRX) shares are down on the FDA's approval of TEVA Pharmaceutical's abbreviated new-drug application for Megestrol Acetate Oral Suspension. Generic Megace is Pharmaceutical Resource's largest current product.

Trucking company Pacer International (PACR) posted 20 cents vs. 13 cents first-quarter earnings per share on 14% higher net revenues. CS First Boston raised its estimate.

Research Frontiers (REFR) granted a license to Air Products & Chemicals, to make and sell suspended particle device emulsions and light-controlling film that was developed by Research Frontiers.

Stephens upgraded Party City (PCTY) to overweight from equal-weight. On Tuesday the retailer of party supplies posted an 11-cent third-quarter loss vs. a 1-cent loss, and withdrew its fiscal 2003 guidance.

Orchid Biosciences (ORCH) received first approval from the American Association of Blood Banks to use single nucleotide polymorphisms as stand-alone genetic markers in its Orchid GeneScreen paternity testing operations.

Needham reiterated its strong buy on Hologic (HOLX). On Tuesday Hologic posted 2 cents vs. 22 cents (including a one-time tax benefit) second-quarter earnings per share despite an 8.5% revenue rise.

Emerson Electric (EMR) posted 56 cents vs. 65 cents second-quarter earnings per share on slightly lower sales (adjusted.). S&P downgraded to avoid from hold.

CS First Boston upgraded payroll processing company Ceridian (CEN) to buy from neutral.

Park Electrochemical (PKE) posted a $2.36 fourth-quarter loss (including charges) vs. a 5-cent loss on 12% lower sales. Park posted a 2-cent fourth-quarter operating loss. It sees no clear sign of a recovery in the electronics industry.

Black Box (BBOX) posted 55 cents vs. 72 cents fourth-quarter earnings per share from operations on 16% lower revenue.

Bausch & Lomb (BOL) says talks with the FDA regarding Retisert implant trials will result in a delayed regulatory approval filing for the treatment of diabetic macular edema by up to three years. S&P maintains sell.

Playboy Enterprises (PLA), which owns Playboy magazine and Spice television, posted 2 cents first-quarter earnings per share vs. a 38-cent loss (including charges) on a 12% revenue rise. Given the strong first-quarter performance and the positive outlook, Playboy thinks 2003 operating profit will be about $22 million, or 30% better than projected. Shares jumped.

GlaxoSmithKline (GSK) shares fell after the drug giant reportedly said Faulding Pharmaceuticals has filed for a generic version of Glaxo's cancer drug Zofran, paving the way for a potentially lengthy patent court case.

Electronic Arts (ERTS) posted 40 cents vs. 33 cents fourth-quarter earnings per share from operations despite 1% lower revenue. Analysts had been expecting earnings of 34 cents a share, on average. The video game software maker sees breakeven first-quarter earnings per share on flat to slightly higher revenue, and $3.10 to $3.25 in fiscal 2004 on $2.8 million to $2.9 million revenue. S&P reiterates accumulate.

Cisco Systems (CSCO) posted 15 cents vs. 11 cents third-quarter earnings per share (pro forma) despite 4% lower sales. The maker of networking gear for the Internet sees flat sequential fourth-quarter revenue. Cisco posted 14 third-quarter earnings per share (GAAP). S&P reiterates strong buy.

Lamar Advertising (LAMR) posted a 20-cent first-quarter loss vs. a 16-cent loss (excluding an accounting change) despite a 4.4% net revenue rise. Lamar sees flat to slight revenue growth in the second quarter, and EBITDA growth in the negative single digits.

CS First Boston downgraded Sanmina-Sciences (SANM) to underperform from neutral.

American Medical Security (AMZ) posted 48 cents vs. 37 cents first-quarter earnings per share as lower costs offset a 7.9% revenue drop. The health-care benefits marketing company says while revenue is still not up to expectations, it expects to achieve $1.85 to $1.95 2003 earnings per share guidance. RW Baird downgraded to neutral.

Citigroup upgraded Watson Pharmaceuticals (WPI) to in-line from underperform. On Tuesday the drug maker posted 44 cents vs. 34 cents first-quarter earnings per share (excluding items) on 18% higher revenue.

Prudential Financial (PRU) posted 58 cents vs. 59 cents first-quarter earnings per share from operations. The insurance and investment services giant expects to achieve $2.25 to $2.40 2003 earnings per share (including a charge).

Friedman Billings Ramsey (FBR) posted 12 cents vs. 19 cents (excluding a gain) first-quarter earnings per share on an 8.9% revenue fall. The investment bank posted 23 cents first-quarter earnings per share (pro forma, including merger expenses).

Newmont Mining (NEM) posted 29 cents first-quarter earnings per share vs. a 3-cent loss (including an accounting change) on a 74% rise in sales and other income.

Swift Energy (SFY) posted 38 cents vs. 12 cents first-quarter earnings per share (excluding an accounting change) on a 56% revenue rise.

Upholstery fabric maker Culp (CFI) sees lower-than-expected 30 cents to 34 cents fourth-quarter earnings per share (excluding a restructure and related charges,) citing soft consumer spending.


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