Markets & Finance

Dell Slips as Profit Meets Wall Street Targets


Computer maker Dell (DELL) posted 26 cents third-quarter earnings per share, vs. 21 cents, meeting analysts' average estimates. Revenues rose 16%, to $10.6 billion. The company sees 28 cents fourth-quyarter earnings per share on $11.5 billion revenue -- an 18% increase. Dell also expects fourth-quarer shipments to be up more than 25%.

Whole Foods Market (WFMI) posted 38 cents, vs. 36 cents fourth-quarter earnings per share on an 8.8% comp-store sales rise. Whole Foods sees 56 cents to 58 cents first-quarter earnings per share on a 9.5% to 12.5% comp-store sales rise, and $1.88 to $1.96 fiscal 2004 earnings per share on an 8% to 10% comp-store sales rise. Whole Foods set a 15 cents quarterly dividend. Lehman raised its estimate and price target. S&P maintains hold.

Wal-Mart (WMT) posted 46 cents, vs. 40 cents third-quarter earnings per share from continuing operations on a 6% same-store sales rise, and a 13% net sales rise. The earnings missed analysts' estimates by a penny. The discount retailer reportedly sees 63 cents to 65 cents fourth-quarter earnings per share from continuing operations. S&P maintains hold. UBS Warburg downgraded.

Gateway (GTW) reached a settlement with the Securities and Exchange Commission that ends the accounting probe of the computer maker. Gateway won't have to pay a penalty. CORRECTION: A previous version of this story incorrectly stated that Gateway "will revamp the management team." A Gateway spokesman says Gateway is not revamping its management team, and notes that the former Gateway execs who were named all left the company in January, 2001.

Tiffany & Co. (TIF) posted 19 cents, vs. 24 cents (including a tax benefit) third-quarter earnings per share despite 18% higher net sales. Tiffany sees 64 cents to 69 cents fourth-quarter earnings per share on a low double-digit percentage increase in net sales. The luxury jewelry retailer raised the fiscal 2005 earnings per share guidance to $1.35 to $1.40.

A study showed that Merck & Co. (MRK) and partner Schering-Plough 's (SGP) new cholesterol medication, Zetia, helped to significantly reduce an inflammatory marker associated with heart disease.

Tessera Technologies (TSRA), a chip packaging-technology company, offered an initial 7,500,000 shares at $13 per share on the Nasdaq.

Merck KGaA reportedly said Swiss authorities have recommended approving its Erbitux drug for the treatment of colorectal cancer. Merck KGaA licenses the right to market the drug, which was developed by ImClone Systems (IMCL).

Chip-equipment maker Applied Materials (AMAT) posted 1 cent (including a 5 cents realignment charge) vs. 9 cents fourth-quarter earnings per share on a 16% sales decline. The results beat analysts' expectations. Applied Materials believes it's in the early stages of an industry uptrend; it expects orders to rise another 20% in the current quarter. S&P reiterates accumulate. Morgan Stanley raised its price target by $5, to $30, and also raised its 2004 and 2005 earnings per share estimates. UBS raised its price target on the stock to $32, from $26, as well as estimates for earnings. Banc of America keeps its neutral rating.

In a 10-Q filed Nov. 12, Verizon Communications (VZ) says the fourth-quarter financial impact from management and union voluntary separation offers, which end no later than Nov. 16, cannot be reasonably estimated but are expected to be significant. S&P keeps hold.

First Boston downgraded paper maker Georgia-Pacific (GP) to underperform from neutral.

Medtronic (MDT) posted 39 cents, vs. 25 cents second-quarter earnings per share on a 14% revenue rise. The medical-device maker set a 30 million share buyback. S&P upgraded to buy. Thomas Weisel reiterates outperform.

Virbac (VBAC) will delay the release of third-quarter results and its 10-Q, pending the completion of an internal inquiry being conducted by the audit committee of the company's board. Virbac cited questions on revenue recognition and inventory accounting practices.

Hansen Natural (HANS) posted 19 cents, vs. 12 cents third-quarter earnings per share on 23% higher sales, continued strong sales from new product introductions, and growth in core beverage lines.

British telecommunications company BT Group (BTY) posted 19% higher second-quarter earnings per share despite a slight sales decline. BT says group turnover declined 2%, led by a 6% decline in turnover from the group's traditional business. BT cited a challenging regulatory environment and lower pricing.

Wachovia upgraded Province Healthcare (PRV) to outperform from market perform.

Morgan Stanley upgraded Watson Pharmaceuticals (WPI) to overweight from equal-weight, and raised the target to $52, from $47.

Berkshire Hathaway (BRK.A) reportedly cut its stake in Level 3 Communications (LVLT) to 1.6 million shares.

RBC Capital upgraded Emulex (ELX) to outperform from sector perform.

ESpeed (ESPD) posted 17 cents, vs. 14 cents third-quarter earnings per share (GAAP) on a 34% revenue rise. ESpeed sees 14 cents to 15 cents fourth-quarter operating earnings per share, and 2004 fully taxed operating earnings per share of 80 cents to 84 cents.

Metro-Goldwyn-Mayer (MGM) says its board approved a "dutch auction" tender offer to purchase up to 10 million shares at a price not less than $16.25 per share, and not greater than $18.00. MGM upped the buyack by an additional 2.5 million shares.

Dow Jones (DJ) reported advertising linage at The Wall Street Journal's U.S. edition increased 13% in October, with year-to-date ad lineage down 2.5%. Based on the current outlook for "about flat" November and December ad linage at the Journal, Dow Jones maintains the fourth-quarter guidance.

Target (TGT) posted 33 cents, vs. 30 cents third-quarter earnings per share on an 11% revenue rise.

Martek Bioscience (MATK) says data from two studies show supplementation with DHA omega-3 fatty acid resulted in a significant cardioprotective benefit for patients at risk for cardiovascular disease. Citigroup upgraded to buy from hold.

The FDA told Sepracor (SEPR) it now sees completing its review of the company's new insomnia drug application on or before February 29, 2004. Sepracor believes that the extension isn't related to any specific questions concerning safety or efficacy.

Waddell & Reed (WDR) reportedly received requests for information from the New York Attorney General's office and the SEC as part of their probes into mutual-fund trades.

AnnTaylor (ANN) posted 63 cents, vs. 53 cents third-quarter earnings per share on 6.2% higher same-store sales, and 17% higher total sales. The retailer says it's comfortable with the current fourth-quarter earnings per share guidance of 41 cents to 43 cents, and expects November, December, and January comp-store sales growth of 5% to 7%.

Liz Claiborne (LIZ) agreed to acquire streetwear label Enyce Holding for about $114 million, including the retirement of debt. Claiborne expects the deal to be about 5 cents accretive to 2004 earnings per share; and adjusted the 2004 earnings per share estimate to $2.70 to $2.77. The company also raised the sales growth estimate to 5% to 8%, from 3% to 6%.


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