Markets & Finance

EchoStar Declines


EchoStar Communications (DISH) reported lower than expected third-quarter earnings per share of 7 cents, vs. 35 cents loss a year ago, on a 19% revenue rise. The satellite broadcaster reportedly says subscriber growth has slowed. SG Cowen cut its estimates. S&P reiterates hold, and notes net new subscribers are slightly below its projections.

Aventis (AVE) and Vertex Pharmaceuticals (VRTX) voluntarily discontinued Phase IIb trials of pralnacasan, an oral interleukin-1 beta converting enzyme inhibitor for the treatment of rheumatoid Arthritis, due to results from an animal toxicology study that showed liver abnormalities. J.P. Morgan Bear Stearns, Goldman Sachs, and S&P downgraded Vertex.

EResearchTechnology (ERES) sees 19 cents to 20 cents fourth-quarter earnings per share on revenue of $18.7 million to $19 million, and 57 cents to 58 cents in 2003, as well as $1.02 to $1.05 in 2004. The 2004 earnings per share is below consensus. On Monday the stock sold off on negative Raymond James comments.

Merrill Lynch upgraded Oakley (OO) and eight other retailers to buy from hold.

Fashion watch maker Fossil (FOSL) posted 34 cents, vs. 29 cents third-quarter earnings per share on a 17% net sales rise. Fossil sees 54 cents to 56 cents fourth-quarter earnings per share. Southwest Securities reiterates strong buy.

Immunomedics (IMMU) is in talks with Amgen (AMGN) concerning a possible return of the North American and Australian development rights of epratuzumab to to Immunomedics. Immunomedics notes Amgen recently advised the company that it decided not to proceed with a registration trial.

UBS Financial downgraded Mylan Labs (MYL) to neutral from buy. S&P downgraded to hold from buy.

Cablevision Systems (CVC) reported a third-quarter loss of 36 cents per share, vs. 26 cents loss a year ago, despite a 12% net revenue rise. The cable operator says it will restate 2003 quarterly financial statements to reflect $15 million of expenses that were improperly recorded in 2002 and earlier periods.

Oracle (ORCL) may have to drop its bid for PeopleSoft (PSFT) if PeopleSoft continues to offer its licensing-free refund program, according to The Wall Street Journal .

J.C. Penney (JCP) reported third-quarter earnings per share from continuing operations of 27 cents, vs. 30 cents a year ago, despite a 1.4% total sales rise. The retailer sees fourth-quarter EPS of 80 cents.

RSA Security (RSAS) sees fourth-quarter earnings per share and revenue at the high end of guidance; RSA sees 4 cents to 7 cents earnings per share, and $63 million to $67 million in revenue. First Albany reiterates buy. S&P reiterates avoid on valuation and concerns about RSA's earnings quality.

Alliance Gaming (AGI) will acquire privately held Sierra Design Group for $45 million, consisting of $27 million in cash, and 736,000 shares of Alliance. The company will pay $95 million over three years following the deal closing, upon achievement of certain financial objectives.

Pacific Sunwear (PSUN) posted 31 cents, vs. 21 cents a year ago, third-quarter earnings per share on 14% higher same-store sales. The retailer says it's comfortable with the fourth-quarter mean consensus earnings per share estimate of 37 cents, based on an assumption of a 5% to 6% same-store sales increase. Pacific Sunwear expects 20% fiscal 2004 earnings per share growth.

Smithfield Foods (SFD) sees about 33 cents second-quarter earnings per share, and 29 cents earnings per share from continuing operations. Smithfield cited sharply improved hog production results and sharply higher beef margins that more than offset somewhat lower fresh pork and processed meats margins.

NBTY (NTY) posted 20 cents, vs. 43 cents, fourth-quarter earnings per share as $10 million in non-recurring charges, higher costs, and expenses offset a 49% sales rise.

Rockwell Collins (COL) posted 40 cents, vs. 38 cents a year ago, fourth-quarter earnings per share on a 6.4% total sales rise. The company maintains the $1.40 to $1.50 fiscal 2004 earnings per share guidance, and the $2.7 billion revenue guidance.


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