Markets & Finance

IBM Hit with SEC Revenue Probe


After the close of trading, IBM Corp. (IBM) said the Securities and Exchange Commission began a formal investigation of its accounting practices, focusing on revenue that was reported in 2000 and 2001. IBM says it believes the probe arises from a separate SEC review of the company's retail store solutions unit. Shares were halted in after-hours trading.

ImClone Systems (IMCLE) says its experimental cancer drug Erbitux, in combination with multiple standard chemotherapy agents, may have potential in treating patients with an advanced form of non small cell lung cancer, according to study results. S&P maintains hold.

Cablevision 's (CVC) board approved a plan to spin off to shareholders its satellite TV service (Rainbow DBS) and its Clearview Cinemas theatre chain, in order to focus on its core cable business. The deal is expected to be completed by year-end.

PeopleSoft (PSFT) is acquiring business software rival J.D. Edwards (JDEC) in a deal valued at about $1.7 billion. Terms: 0.860 PeopleSoft share for each J.D. Edwards share held. Baird cut J.D. Edwards to neutral. S&P downgraded J.D. Edwards to avoid, and keeps its avoid ranking on PeopleSoft.

Goldman Sachs upgraded American Airlines parent AMR Corp. (AMR) to outperform from in-line.

On Louis Rukeyser's Wall Street program, RS Partners Fund's Andy Pilara said he liked Fresh Del Monte 's (FDP) stock.

OSI Pharmaceuticals (OSIP) and Genentech reported positive Phase I results on Tarceva with brain cancer patients. The "promising activity" was reported with cancer patients by the Memorial Sloan-Kettering Cancer Center. Bear Stearns raised estimates.

Genentech (DNA) reported positive results for Avastin in metastatic colorectal cancer patients. S&P keeps hold. Merrill Lynch and Deutsche Bank raised their targets.

Vical (VICL) says results from its Phase II trial of high-dose Allovectin may point to a potentially safer, better tolerated approach to treating melanoma.

Vion Pharmaceuticals (VION) is seeing heavy volume. The biotech firm says its Phase I data of trials of Triapine/Gemcitabine in patients with advanced cancer were "positive," and Vion has initiated Phase II trials.

ICN Pharmaceuticals intends to acquire the 20.9% of Ribapharma (RNA) it it spun off last year $5.60 per share cash, for a total value of $168 million.

Gerard Klauer upgraded electronics appliance retailer Rex Stores (RSC) to outperform from neutral.

Tropical Sportswear (TSIC) hired Merrill Lynch to evaluate strategic options for maximizing shareholder value.

BB&T Capital upgraded Celadon (CLDN) to strong buy from hold mainly on valuation.

SoundView raised its estimates on Chippac (CHPC).

CS First Boston raised its target on PEC Solutions (PECS).

Merrill upgraded Coach (COH) to buy from neutral.

Banc of America reportedly downgraded Dick's Sporting (DKS) to neutral from buy.

Ligand Pharmaceuticals (LGND) says Ontak demonstrated activity against chronic lymphocytic leukemia in a Phase II study. Data also showed the potential to treat B- and T-Cell non-Hodgkin's Lymphoma.

UBS Warburg downgraded Sonosite (SONO) to neutral from buy on valuation.

IMC Global (IGL) expects second-quarter earnings per share from continuing operations to be about breakeven before foreign exchang due to a disappointing U.S. spring season for phosphate and potash volumes. S&P downgraded to hold.

Banc of America downgraded Advanced Micro Device (AMD) to sell.

Pharmacyclics (PCYC) says an analysis of Phase 1 results of its Xcytrin Injection, plus radiation therapy, for the treatment of glioblastoma multiforme suggests a survival benefit.

A RailAmerica (RRA) subsidiary acquired or leased 288 miles of contiguous rail line in and around Mobile, Ala., from Burlington Northern and Santa Fe Railway for $15 million.

Biovail (BVF) acquired the rights to the Ativan and Isordil oral product lines from Wyeth for $130 million and annual payments pursuant to a three-year supply agreement.

USB Warburg downgraded Kos Pharmaceuticals (KOSP) to neutral from buy, and Deutsche Bank reportedly to hold from buy.

An Amgen (AMGN) study showed the majority of patients with measurable metastatic colorectal cancer who over-expressed the epidermal growth factor receptor (EGFr) experienced either partial antitumor responses or had stable disease.

Premcor (PCO) sees 50 cents to 75 cents second-quarter earnings per share, and says refining margins and the light-heavy spread weakened during the month of May.

Corixa (CRXA) says a high proportion of patients with advanced low-grade or transformed non-Hodgkins Lymphoma who received long-term durable responses to Bexxar therapy had complete responses, while many patients remained in remission.

Henry Schein (HSIC) will acquire Colonial Surgical for an undisclosed amount. It expects the acquisition to add 2 cents to 3 cents to second-half 2003 earnings per share, and 4 cents to 6 cents to the 2004 earnings per share.

A Sylvan Learning (SLVN) subsidiary will acquire and 80% interest in an entity that controls Universidad Nacional Andres Bello, and Academia de Idiomas y Estudios Profesionales in Chile. Terms: $68.2 million plus an estimated $3 million to $4 million transaction cost.


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