Markets & Finance

Avon Falls on Lowered Guidance


Shares of Avon Products (AVP) fell Wednesday after the company cut its guidance for 2005 earnings per share on general weakness. The company expects flat to down operating profit, and a low-to-mid single digit rise in 2005 earnings per share on a mid-single digit rise in revenue. Morgan Stanley reportedly cuts to equal weight.

FedEx (FDX) shares rose after the company posted $1.25 vs. $1.08 first quarter earnings per share from operations on a 10% revenue rise. The company sees $1.30 to $1.45 second quarter earnings per share, and raises its fiscal year 2006 earnings per share guidance to $5.25 to $5.50, reflecting economic uncertainty surrounding hurricane effects and volatile fuel prices.

Lennar (LEN) said its third quarter earnings per share will exceed $2.00, above its $1.85 goal, at the high end of analysts' estimates. The company says it will be increasing its fiscal year 2005 earnings per share goal in its earnings per share conference call next week.

New York Times(NYT) said it sees 11 cents to 14 cents third quarter earnings per share. The media company says advertising in September has been challenging. August 2005 advertising revenues rose 1.7%, while total revenues rose 0.6% (results include About.com). The company plans to cut about 500 jobs.

Alkermes (ALKS) and Cephalon (CEPH)said that the Food and Drug Administration extended its action date to Dec. 30 from Sept. 30, for priority review of their New Drug Application for Vivitrex, an alcoholism treatment.

Qualcomm (QCOM) raised its fourth quarter earnings per share (pro forma) to 32 cents to 33 cents, with revenue to be in the $1.48 to $1.58 range, based on a shipment of about 40 million MSM phone chips during the quarter vs. 39 million a year ago.

Goodyear Tire (GT) said it's exploring the possible sale of its engineered products business. S&P reiterated its hold on the stock.

American International Group (AIG) estimated third quarter total after-tax insurance related losses, net of reinsurance recoverables, of about $900 million. Plus, the insurance company expects an after-tax charge of about $170 million relating to reinstatement premiums. S&P upped its opinion on AIG shares to buy.

Inamed (IMDC) received a Food and Drug Administration approvable letter for its responsive silicone gel filled breast implants. S&P reiterated its hold on the stock.

Diebold (DBD) said its sees 32 cents to 37 cents third quarter earnings per share, including charges related to continued realignment of operations and start-up costs. The company says it's disappointed with a lack of progress in correcting its operational inefficiencies and evaluating further restructuring.

ConAgra Foods (CAG) posted 68 cents vs. 26 cents first quarter earnings per share on unchanged sales. The company said that first quarter fiscal year 2006 reflects a large gain from selling 15.4 million PPC shares, as well as solid performance in several business areas. The company sees fiscal year 2006 earnings per share higher than fiscal year 2005 earnings per share, excluding special items.

Ashland (ASH) said it sees lower-than-expected fourth quarter earnings per share, noting that it could fall below a year ago's. The company cited high raw materials and energy costs. The company plans to record a fourth quarter pre-tax charge, which it estimates will be up to $14 million, due to factors such as damage from the hurricane.

H.B. Fuller (FUL) posted 53 cents vs. 31 cents third quarter earnings per share on a 2.5% rise in revenue, as factors such as lower volumes offset improved pricing and positive currency effects. The company sees its performance reaching the upper end of fiscal year 2005 (ending November) earnings per share guidance of $1.75 to $1.85.

CarMax (KMX) posted 39 cents vs. 28 cents second quarter earnings per share on 10% higher same-store sales and 23% higher total sales. The company sees 19 cents to 25 cents third quarter earnings per share on same-store used unit sales growth in the range of 2% to 8%.

Biomet (BMET) posted 40 cents vs. 24 cents first quarter earnings per share on a 11% revenue rise. The company remains comfortable with analysts' estimates of $497 million to $506 million second quarter, and 42 cents to 44 cents earnings per share.

Hillenbrand (HB) Due to recent increases in fuel costs, antitrust litigation expenses, and Hurricane Katrina relief efforts, cut its $2.95 to $3.05 fiscal year 2005 earnings per share guidance to $2.90 to $2.95, before special items.

Jack In The Box (JBX) plans to cancel its test of Jack in the Box Grill as a stand-alone concept, resulting in an after-tax charge of 5 cents a share in the fourth quarter. Due to a charge, lower same-store sales estimate, and higher utility costs, the restaurant chain sees 56 cents fourth quarter earnings per share, and $2.45 in fiscal year 2005.

Christopher & Banks (CBK) posted 16 cents vs. 15 cents second quarter earnings per share on 3% higher same-store sales and 15% higher total sales. The company sees fiscal year 2006 earnings per share of 78 cents to 83 cents. The company says September-to-date comparables are flat. S&P maintained its hold on the stock.

CKE Restaurants (CKR) posted 13 cents second quarter earnings per share vs. 22 cents of loss on 1.7% higher total revenue. The company posted 28 cents pro forma earnings per share. Same-store sales rose slightly at the company-operated Carl's Jr., but were flat at Hardee's.

Biogen Idec (BIIB) and Elan (ELAN) announced that in the coming weeks they expect a completed safety evaluation of TYSABRI, a treatment for Crohn's disease and rheumatoid arthritis, among other things.

Global ePoint (GEPT) said it expects to benefit from news that the Federal Aviation Administration is proposing installation of security cameras on board commercial airlines.

AutoZone (AZO)posted lower-than-expected $2.66 vs. $2.53 fourth quarter earnings per share on 1% lower same-store sales and a 2.5% total sales rise. The company noted that fourth quarter net income decreased 1.3% vs. a year ago.

Cott (COT) said it sees 2005 earnings per share substantially below its guidance. The company noted impact from continued carbonated soft drink volume softness in the U.S., a product mix shift toward lower-margin bottled water, and escalating raw material costs.

Ultralife Batteries (ULBI) cut its $46 million second half 2005 revenue forecast to $35 million, due to ongoing uncertainty regarding the timing and the quantity of BA-5390 battery orders from the U.S. Defense Deptartment for the remainder of this year.

QLT (QLTI) said a preliminary analysis of the intent to treat population of Visudyne in Occult (VIO) trial did not achieve the primary end point at the two-year time point. The company is still conducting further safety and efficacy analyses of the medical treatment.

Possis Medical (POSS) posted 7 cents vs. 18 cents fourth quarter earnings per share on a 19% revenue decline. The company sees 1 cents to 2 cents first quarter earnings per share on revenue of $69 million to $74 million, and sees 24 cents to 34 cents fiscal year 2006 earnings per share on revenue of $69 million to $74 million.

Landry's Restaurants (LNY) said that 18 restaurants in Galveston County, Texas are closed as a result of mandatory evacuations due to the possibility Hurricane Rita will come ashore in that area. The company still has three restaurants closed due to Katrina.


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