Markets & Finance

Shaw Group Climbs


Shaw Group (SGR) announced that a unit has been awarded a $570 million negotiated fixed price EPC contract by Astoria Energy LLC for Phase I of a 1000 mmegawatt power project in New York City. S&P upgraded to hold from avoid. First Albany keeps underperform.

New York Attorney General Eliot Spitzer launched an investigation of mutual fund companies Janus Capital (JNS), Bank One, Bank of America, and Strong Capital Management for alleged illegal trading practices with hedge fund Canary Capital Partners, which agreed to a $40 million settlement. Spitzer said his office uncovered evidence that Canary received special trading privileges in exchange for investments in various mutual fund families.

In an 8-K filing, Office Depot (ODP) estimates the downside risk to third-quarter earnings per share is "a couple of pennies" due to current foreign exchange trends.

Take-Two Interactive (TTWO) posted 18 cents vs. 12 cents third-quarter earnings per share on a 27% sales rise. The video-game software maker agreed to buy TDK Mediactive in a $22.7 million deal. Take-Two raised the fiscal 2003 guidance to $1.015 billion revenue and $2.30 earnings per share. Also, the company sees $1.18 billion in fiscal 2004 revenue, and $2.68 earnings per share.

Delta Air Lines (DAL) is seen higher in sympathy with AMR, amid general expectations that airlines will show improved results in August.

Merrill Lynch added AMR Corp. (AMR), parent of American Airlines, to its Focus One List.

Discount airline AirTran (AAI) posted 33% higher August revenue passenger miles, 19% higher available seat miles, and a 7.8% higher load factor.

AdvancePCS (ADVP) agreed to be acquired by rival pharmacy-benefits manager Caremark Rx (CMX) for around $6 billion in cash and stock. S&P upgraded Caremark to buy from accumulate.

Credit Suisse First Boston assumed coverage of Macromedia (MACR) and upgraded to outperform from neutral.

Coach (COH) sees 18 cents first-quarter earnings per share (pro forma, including the effect of a two-for-one split) on $245 million in sales. The leather-goods retailer says U.S. same-store sales are trending ahead of expectations, while double-digit same-store sales growth in Japan continue.

Charles River Labs (CRL) cut the 42 cents to 44 cents third-quarter earnings per share guidance on 12% to 14% revenue growth to 39 cents to 41 cents earnings per share on 6% to 9% revenue growth. Baird downgraded to neutral from outperform.

Lilly (ELI) received an FDA approvable letter for duloxetine for the treatment of stress urinary incontinence. Lilly notes final approval is contingent upon the successful completion of additional acute pre-clinical and clinical pharmaceutical studies.

Omega Protein (OME) announced it received a letter dated Aug. 29 from Ferrari Investments of Comodoro Rivadava and unidentified U.S. partners making an offer to acquire all shares of Omega for $9.50 per share in cash.

Cisco Systems ' (CSCO) CEO John Chambers reportedly says August orders are better than expected. However, he says he's uncertain if August results are sustainable.

H.J. Heinz (HNZ) posted 53 cents vs. 44 cents first-quarter earnings per share from continuing operations on a 3.1% rise in sales from continuing operations. The condiments maker says it's on track to meet fiscal 2004 earnings per share, net sales, and free cash flow targets.

Chico's FAS (CHS) posted 19% higher August same-store sales, and 43% higher total sales. The women's retailer announced the promotion of president and COO Scott Edmonds to CEO; the present CEO and co-founder, Marvin Gralnick, will remain as chairman of the board.

Networker Adtran (ADTN) raised third-quarter revenue guidance to $98 million to $100 million, and sees 34 cents to 36 cents third-quarter earnings per share.

J.P. Morgan upgraded General Electric (GE) to neutral after Vivendi signed a preliminary deal to sell its film and TV assets to GE's NBC unit in a deal valued at about $14 billion. Under the plan, GE would own 80% of the new U.S. media giant and Vivendi would have around a 20% stake. S&P reiterates hold on GE.

The FDA placed Phase III trials of Antigenics ' (AGEN) Oncophage personalized cancer vaccine on partial hold, pending the receipt and acceptance of product characterization information.

Walter Industries (WLT) cut the $1.30 to $1.40 2003 earnings per share forecast to 70 cents to 80 cents on adverse geologic conditions at Jim Walter Resources, increased scrap iron costs at U.S. Pipe & Foundry, and lower revenues due to delays in housing starts.

The FDA granted fast track designation for Telik 's (TELK) Telcyta as a third-line therapy in patients with platinum refractory or resistant ovarian cancer.

Fairchild Semiconductor (FCS) reaffirmeed the third-quarter revenue guidance of a 4% to6% sequential decline. The chip maker notes its order rates and backlog are improving.

Valero Energy (VLO) sees third-quarter earnings per share in the $1.25 range.

Mandalay Resort (MBG) posted second-quarter earnings per share of 67 cents vs. 41 cents on a 6.8% revenue rise. S&P reiterates accumulate.

Qwest Communications (Q) posted a 5-cent second-quarter loss on $3.439 billion in operating revenue. Qwest will release financial results for 2000 through 2002 as soon as possible, and says it's on track to meet the previously announced 2003 guidance.


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