Markets & Finance

D.R.Horton Drops


D.R.Horton (DHI) is seen lower with other homebuilders on concerns that a softening of the mortgage business -- highlighted by Washington Mutual's earnings Tuesday, and expected interest-rate increases in 2004 following the Fed's remarks -- will hurt the homebuilding market.

Photronics (PLAB) posted 10 cents fourth-quarter earnings per share, vs. a 32 cents loss on a 1.6% sales rise. S&P maintains accumulate.

ST Robinson Humphrey upgraded Monster Worldwide (MNST) to overweight from underweight.

BB&T Capital initiates coverage of Hub Group (HUBG) with strong buy and a $30 target.

UBS Financial downgraded Schering-Plough (SGP) to reduce from neutral.

Banc of America initiates coverage of Aaipharma (AAII) with buy.

An FDA panel said that more research is needed before it could approve Ranexa, CV Therapeutics ' (CVTX) treatment for chronic angina. UBS says the panel's outcome was more positve than he expected; 5 of 11 FDA panel members recommended outright approval of Ranexa, with the rest recommending that additional data be submitted. Bear Stearns cut CV Therapeutics to underperform from peer perform.

AutoZone (AZO) posted $1.35, vs. $1.04 first-quarter earnings per share on 1% higher domestic retail same-store sales (17% higher AutoZone Commercial sales), and 5.2% higher total sales. USB Piper downgraded the shares to market perform from strong buy, calling the same-store figure "surprisingly weak". AG Edwards downgraded. S&P reiterated its accumulate opinion, but cut the price target.

CIBC World upgrades Panera Bread (PNRA) estimates. Panera agreed to develop 20 bakery-cafes in five New York counties. Raymond James upgraded to strong buy on valuation.

Verizon Communications (VZ) expects to record a fourth-quarter after-tax charge of about $2.8 billion, or 99 cents in earnings per share, related to a voluntary workforce reduction. Verizon will also record a pension-related charge of $700 million to $900 million after taxes, mostly in the first quarter of 2004.

ESS Technology (ESST) raised its $65 million to $68 million fourth-quarter revenue guidance to $79 million to $82 million, and raised the 6 cents to 9 cents fourth-quarter GAAP earnings per share guidance to 15 cents to 19 cents. ESS cited strong worldwide demand for its digital entertainment products. American Technology Research upgraded to buy from hold. Pacific Growth initiated coverage with overweight.

Cyberonics (CYBX) says its board approved an amendment of shareholder rights plan to permit Boston Scientific (BSX) to increase its ownership from up to 15% to up to 20% of Cyberonics shares.

Sunguard Data Systems agreed to acquire Systems & Computer Technology (SCTC) for $16.50 per share in cash, in a deal valued at about $584 million.

UBS Financial reportedly downgraded Schering-Plough (SGP) to reduce from neutral.

Merrill reinstated coverage of Cypress Semiconductor (CY) with buy.


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